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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 20-F

(Mark One)
☐     REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
OR

☒     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2024

OR

☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
OR

☐     SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report: Not applicable

For the transition period from       to       
Commission file number: 001-41413

 
United Maritime Corporation
 
 
(Exact name of Registrant as specified in its charter)
 
 
 
 
 
 (Not Applicable)
 
 
 (Translation of Registrant’s name into English)
 
 
 
 
 
 Republic of the Marshall Islands
 
 
 (Jurisdiction of incorporation or organization)
 
 
 
 
 
154 Vouliagmenis Avenue, 166 74 Glyfada, Greece
 
(Address of principal executive offices)
 
 
 
 
 
Stamatios Tsantanis, Chairman & Chief Executive Officer
 
 
United Maritime Corporation
 
 
154 Vouliagmenis Avenue, 166 74 Glyfada, Greece
 
 
Telephone: +30 2130181507
  
 
Facsimile: +30 2109638404
  
 
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
  


Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of class
​
​
Trading Symbol(s)
​
​
Name of exchange on which registered
Shares of common stock, par value $0.0001, including the Preferred Stock Purchase Rights
​
​
 USEA
​
​
 The Nasdaq Stock Market LLC

Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:

As of December 31, 2024, 8,844,267 shares of common stock, par value $0.0001 per share, and 40,000 Series B Preferred Shares, par value $0.0001 per share, were outstanding.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  ☐ Yes ☒ No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.  ☐ Yes ☒ No

Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  ☒ Yes  ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  ☒ Yes  ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ☐
​
​
Accelerated filer  ☐
​
​
Non-accelerated filer ☒
 
​
​
  
​
​
Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act.  ☒

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.  ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ☒
​
​
International Financial Reporting Standards as issued by the International Accounting Standards Board  ☐
​
​
Other  ☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

 ☐ Item 17
​
​
☐ Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

a ☐ Yes
​
​
 ☒ No

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. N/A

a ☐ Yes
​
​
  a ☐ No

TABLE OF CONTENTS

 
Page
4
ITEM 1.
 4
ITEM 2.
 4
ITEM 3.
 4
ITEM 4.
 39
ITEM 4A.
 60
ITEM 5.
 60
ITEM 6.​​
 74
ITEM 7.​
 77
ITEM 8.
 79
ITEM 9.​
 79
ITEM 10.​​
 79
ITEM 11.
 88
ITEM 12.​​
 89
​
 ​
89
ITEM 13.​​
 89
ITEM 14.​​
 89
ITEM 15.​​
 89
ITEM 16
 90
ITEM 16A.
 90
ITEM 16B.​
 90
ITEM 16C.
 91
ITEM 16D.
 91
ITEM 16E.
 91
ITEM 16F.
 91
ITEM 16G.
 92
ITEM 16H.
 92
ITEM 16I.
 92
ITEM 16J.
 92
ITEM 16K.
 93
   
94
ITEM 17.
 94
ITEM 18.
 94
ITEM 19.
 94

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Table of Contents
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This annual report on Form 20-F contains certain forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements regarding our or our management’s expectations, hopes, beliefs, intentions, or strategies regarding the future and other statements that are other than statements of historical fact. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Without limiting the generality of the foregoing, all statements in this annual report concerning or relating to estimated and projected earnings, margins, costs, expenses, expenditures, cash flows, growth rates, future financial results and liquidity are forward-looking statements. In addition, we, through our senior management, from time to time may make forward-looking public statements concerning our expected future operations and performance and other developments.

The forward-looking statements in this annual report are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs, or projections. As a result, you are cautioned not to rely on any forward-looking statements.

Many of these statements are based on our assumptions about factors that are beyond our ability to control or predict and are subject to risks and uncertainties that are described more fully in “Item 3. Key Information—D. Risk Factors.” Any of these factors or a combination of these factors could materially affect our future results of operations and the ultimate accuracy of the forward-looking statements. In addition to these important factors, important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include among other things:


 •
changes in shipping industry trends, including charter rates, vessel values, and factors affecting vessel supply and demand;


•
changes in seaborne and other transportation patterns;


•
changes in the supply of or demand for dry bulk commodities, including dry bulk commodities carried by sea, generally or in particular regions;


•
changes in the number of newbuildings under construction in the dry bulk shipping industry;


•
changes in the useful lives and the value of our vessels and the related impact on our compliance with the covenants under our financing arrangements;


•
the aging of our fleet and increases in operating costs;


•
changes in our ability to complete future, pending, or recent acquisitions or dispositions;


•
our ability to achieve successful utilization of our fleet;


•
changes to our financial condition and liquidity, including our ability to pay amounts that we owe and obtain additional financing to fund capital expenditures, acquisitions, and other general corporate activities;


•
risks related to our business strategy, areas of possible expansion, or expected capital spending or operating expenses;


•
our dependence on Seanergy Maritime Holdings Corp. and our third-party managers to partly operate our business;

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 •
changes in the availability of crew, number of off-hire days, classification survey requirements, and insurance costs for our vessels;


•
changes in our relationships with our contract counterparties, including the failure of any of our contract counterparties to comply with their agreements with us;


•
loss of our customers, charters, or vessels;


•
damage to our vessels;


•
potential liability from future litigation and incidents involving our vessels;


•
our future operating or financial results;


•
changes in interest or inflation rates;


•
acts of terrorism, war, piracy, and other hostilities;


•
public health threats, pandemics, epidemics, other disease outbreaks or calamities and governmental responses and other effects thereto;


•
changes in global and regional economic and political conditions, including the provision or removal of economic stimulus measures meant to counteract the effects of sudden market disruptions due to financial, economic or health crises;


•
changes in tariffs, trade barriers, embargos and regulatory requirements;


•
general domestic and international political conditions or events, including trade wars, acts of hostility or potential, threatened, or ongoing war including between Russia and Ukraine (and related sanctions), Israel and Hamas, and China and Taiwan, the conflict between Israel and Hezbollah, the Houthi crisis in the Red Sea, the tensions between Israel and Iran, tensions between the U.S. and China, the U.S. and Panama and the U.S. and the European Union and North Atlantic Treaty Organization (“NATO”) members;


•
changes in governmental rules and regulations or actions taken by regulatory authorities, particularly with respect to the marine transportation industry;


•
our ability to continue to implement and maintain adequate Environmental, Social and Governance ("ESG") practices, policies, programs, goals and targets;


•
Our ability to continue as a going concern; and


•
other factors discussed in “Item 3. Key Information—D. Risk Factors” and other important factors described from time to time in the reports we file with the U.S. Securities and Exchange Commission (the “Commission”).

Should one or more of the foregoing risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Consequently, there can be no assurance that actual results or developments anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences to, or effects, on us. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements.

We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable laws. If one or more forward-looking statements are updated, no inference should be drawn that additional updates will be made with respect to those or other forward-looking statements.

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PART I

Unless the context otherwise requires, as used in this annual report, the terms “Company,” “we,” “us,” and “our” refer to United Maritime Corporation and any or all of its subsidiaries, and “United Maritime Corporation” refers only to United Maritime Corporation and not to its subsidiaries. We were incorporated under the laws of the Republic of the Marshall Islands on January 20, 2022 and did not commence operations until the consummation of the Spin-Off (as described below) on July 5, 2022. “United Maritime Predecessor” refers to the vessel-owning subsidiary of the M/V Gloriuship prior to its contribution to us, when it was owned by Seanergy Maritime Holdings Corp. (“Seanergy” or the “Parent”). For the period from January 1, 2022 up to July 5, 2022, the accompanying financial statements reflect the financial position and results of the carve-out operations of United Maritime Predecessor. For the period from January 20, 2022 up to December 31, 2022, for the period from January 1, 2023 up to December 31, 2023 and for the period from January 1, 2024 up to December 31, 2024 the accompanying financial statements reflect the financial position and results of United Maritime Corporation and of its consolidated subsidiaries.

We use the term deadweight tons, or “dwt,” in describing the size of vessels. Dwt, expressed in metric tons, each of which is equivalent to 1,000 kilograms, refers to the maximum weight of cargo and supplies that a vessel can carry. Unless otherwise indicated, all references to “U.S. dollars,” “dollars,” “U.S. $” and “$” in this annual report are to the lawful currency of the United States of America.

ITEM 1.
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not applicable.

ITEM 2.
OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3.
KEY INFORMATION

A.
[Reserved]

B.
Capitalization and Indebtedness

Not applicable.

C.
Reasons for the Offer and Use of Proceeds

Not applicable.

D.
Risk Factors

Some of the following risks relate principally to the industry in which we operate and others relate to our business in general or our common shares. If any of the following risks occur, our business, financial condition, results of operations, and cash flows could be materially adversely affected and the trading price of our securities could decline.

Summary of Risk Factors

Below is a summary of the principal factors that make an investment in our common shares speculative or risky. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the headings “Risks Relating to Our Industry,” “Risks Relating to Our Company,” and “Risks Relating to Our Common Shares” and should be carefully considered, together with other information in this annual report on Form 20-F and our other filings with the Commission, before making an investment decision regarding our common shares.

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The principal risk factors, as more particularly described in this “Item 3. Key Information—D. Risk Factors” below, include but are not limited to the following:

Risks Relating to Our Industry


 •
general dry bulk market conditions, including fluctuations in charter hire rates, vessel values, vessel supply, and demand for vessels;


•
general economic, political, and business conditions and disruptions, including sanctions, public health, war, piracy, terrorist attacks, and other measures;


•
our dependence on index-linked charters;


•
global economic conditions and disruptions in world financial markets and the resulting governmental action;


•
significant tariffs or other restrictions imposed on imports and related countermeasures could have a material adverse effect on our operations and financial results;


•
compliance with, and our liabilities under, governmental, tax, environmental, and safety laws and regulations;


•
changes in governmental regulation, tax, and trade matters and actions taken by regulatory authorities;


•
inherent operational risks, weather damage, seasonal fluctuations, and inspection procedures of the dry bulk industry;


•
increased scrutiny of environmental, social, and governance matters;

Risks Relating to Our Company


 •
reliance on information systems and potential security breaches;


•
our borrowing availability under our loan agreements and other security agreements and compliance with the financial covenants therein, and ability to borrow new funds or refinance existing facilities;


•
our use of available funds, and the banks in which such funds are held;


•
capital expenditures and other costs, such as increased fuel prices, necessary to operate and maintain our fleet;


•
our dependence on a limited number of customers for a large part of our revenue;


•
technological developments which affect global trade flows and supply chains may affect our business and results of operations;


•
our dependence on our charterers and other counterparties fulfilling their obligations;


•
our ability to attract and retain key management personnel and potentially manage growth and improve our operations and financial systems and staff;


•
delays or defaults by the shipyards in the construction of newbuildings, or defaults in constructions; or delays cancellations or non-completion of deliveries of purchased vessels;


•
our ability to successfully and profitably employ our vessels;


•
conflicts of interest which may arise from our officers’ and directors’ association with the Parent;


•
labor interruptions, including failure of industry groups to renew industry-wide collective bargaining agreements;

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 •
the aging of our fleet and vessel replacement;


•
our vessels becoming unavailable or going off-hire;


•
potential increased premium payments from protection and indemnity associations;


•
technological innovation and quality and efficiency requirements from our customers;


•
fluctuations in foreign currency exchange and interest rates, including volatility of SOFR and potential changes of the use of SOFR as a benchmark;


•
effects of worldwide inflationary pressures;


•
our dependence on the ability of our subsidiaries to distribute funds to us;


•
our ability to compete for charters;


•
our dependence on the Parent and its wholly-owned management subsidiaries to partly operate our business;


•
fraud, fraudulent, and illegal behavior, including the smuggling of drugs or other contraband onto our vessels;


•
arrest or requisition of our vessels;


•
potential cyber-attacks;

Risks Relating to Our Common Shares


 •
effects of U.S. federal tax on us and our shareholders;


•
volatility in the price of our common shares, the continuation of a liquid trading market, and dilution of shareholders;


•
the superior voting rights of our Series B Preferred Shares and any conflict of interest of the holder of such shares;


•
the effect of anti-takeover provisions of our organization documents;


•
our ability to pay dividends;


•
delisting of our common shares from the Nasdaq Capital Market;


•
compliance with economic substance requirements;


•
our ability to access the credit and capital markets at the times and in the amounts needed on acceptable terms;


•
other factors that may affect our financial condition, liquidity, results of operations, and ability to pay dividends; and

Other Risk Factors


 •
other risk factors discussed under “Item 3. Key Information—D. Risk Factors.”

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Risks Relating to Our Industry

Charter hire rates for dry bulk vessels are cyclical and volatile and the dry bulk market remains significantly below its historic high. This may adversely affect our earnings, revenue, and profitability and our ability to comply with our loan covenants or covenants in other financing agreements.

The volatility in the dry bulk charter market, from which we derive part of our revenues, has affected the dry bulk shipping industry and has harmed our business. The Baltic Dry Index, or the BDI, a daily average of charter rates for key dry bulk routes published by the Baltic Exchange Limited, has long been viewed as the main benchmark to monitor the movements of the dry bulk vessel charter market and the performance of the entire dry bulk shipping market and has been very volatile in recent years. The BDI declined from an all-time high of 11,793 in May 2008 to an all-time low of 290 in February 2016, which represents a decline of approximately 98%. In the following years volatility was also apparent, albeit less extreme. In 2024, the BDI ranged from a low of 976 on December 19, 2024 to a high of 2,419 on March 18, 2024. Although the BDI was 1,404 as of April 7, 2025, due to its volatile nature, there can be no assurance of the future performance of the BDI.

The decline from historic highs and volatility in charter rates following 2008 is due to various factors, including the over-supply of dry bulk vessels, the lack of trade financing for purchases of commodities carried by sea, which resulted in a significant decline in cargo shipments and trade disruptions caused by natural or other disasters, such as those that resulted from the dam collapse in Brazil in 2019 and the outbreak of the coronavirus infection in China. More recently, following Russia’s invasion of Ukraine in February 2022, the U.S., the EU, the UK and other countries have imposed sanctions against Russia and certain disputed regions of Ukraine including, among others, prohibitions and restrictions on selling or importing goods, services, or technology in or from affected regions, travel bans, and asset freezes impacting connected individuals and political, military, business, and financial organizations in Russia, severing large Russian banks from U.S. and/or other financial systems, and barring some Russian enterprises from raising money in the U.S. market. The U.S., EU, and other countries could impose wider sanctions and take other actions. The war in Ukraine has resulted in higher freight market volatility and while the initial effect on the dry bulk freight market was positive, the long-term effects so far remain unclear. More recently, the war between Israel and Hamas has resulted in increased tensions in the Middle East region, including missile attacks by the Houthis on vessels in the Red Sea and thus creating uncertainty and risks to shipping operations in the region. Such circumstances have had and could in the future result in adverse consequences from time to time for dry bulk shipping, including, among other developments, such as:


 •
decrease in available financing for vessels;


•
no active secondhand market for the sale of vessels;


•
decrease in demand for dry bulk vessels and limited employment opportunities;


•
charterers seeking to renegotiate the rates for existing time charters;


•
widespread loan covenant defaults in the dry bulk shipping industry due to the substantial decrease in vessel values; and


•
declaration of bankruptcy by some operators, charterers, and vessel owners.

The degree of charter hire rate volatility among different types of dry bulk vessels has varied widely. If we enter into a charter when charter hire rates are low, our revenues and earnings will be adversely affected and we may not be able to successfully charter our vessels at rates sufficient to allow us to operate our business profitably or meet our obligations. Further, if low charter rates in the dry bulk market decline further for any significant period, this could have an adverse effect on our vessel values and ability to comply with the financial covenants in our loan agreements or other financing agreements. In such a situation, unless our lenders are willing to provide waivers of covenant compliance or modifications to our covenants, our lenders could accelerate our debt and we could face the loss of our vessels. We expect continued volatility in market rates for our vessels in the foreseeable future with a consequent effect on our short and medium-term liquidity. We cannot assure you that future charter rates will enable us to cover our liabilities, operate our vessels profitably, or pay dividends.

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The factors that influence demand for dry bulk shipping capacity include:


 •
supply of and demand for energy resources, commodities, and semi-finished consumer and industrial products and the location of consumption versus the location of their regional and global exploration production or manufacturing facilities;


•
the globalization of production and manufacturing;


•
changes in interest or inflation rates;


•
general domestic and international political conditions or events, including trade wars, retaliatory economic measures, acts of hostility or potential, threatened, or ongoing war including between Russia and Ukraine (and related sanctions), Israel and Hamas, and China and Taiwan, the conflict between Israel and Hezbollah, the Houthi crisis in the Red Sea, the tensions between Israel and Iran, tensions between the U.S. and China, the U.S. and Panama and the U.S. and the European Union and NATO members;


•
global and regional economic and political conditions and developments, including the provision or removal of economic stimulus measures meant to counteract the effects of sudden market disruptions due to financial, economic or health crises;


•
natural disasters and weather;


•
public health threats, pandemics, epidemics, and other disease outbreaks and governmental responses thereto;


•
embargoes and strikes;


•
disruptions and developments in international trade, including trade disputes or the imposition of tariffs or trade barriers on various commodities or finished goods;


•
changes in seaborne and other transportation patterns, including the distance cargo is transported by sea;


•
environmental and other legal or regulatory developments; and


•
political developments, including changes to trade policies or trade wars, including the provision or removal of economic stimulus measures meant to counteract the effects of sudden market disruptions due to financial, economic, or health crises;

We anticipate that the future demand for our dry bulk vessels and charter rates will be dependent upon continued economic growth in the world’s economies, seasonal and regional changes in demand and changes to the capacity of the global dry bulk vessel fleet and the sources and supply of dry bulk cargo to be transported by sea. Adverse economic, political, social, or other developments could negatively impact charter rates and therefore have a material adverse effect on our business, results of operations, and ability to pay dividends. We may also decide that it makes economic sense to lay up one or more vessels. While our vessels are laid up, we will pay lay-up costs, but those vessels will not be able to earn any hire.

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An over-supply of dry bulk vessel capacity may depress the current charter rates and vessel values and, in turn, adversely affect our profitability.

The market supply of vessels generally increases with deliveries of new vessels and decreases with the recycling of older vessels, conversion of vessels to other uses, such as floating production and storage facilities, and loss of tonnage as a result of casualties. In previous years, the market supply of dry bulk vessels had increased due to the high level of new deliveries. Dry bulk newbuildings were delivered in significant numbers starting at the beginning of 2006 and continued to be delivered in significant numbers through 2017. In addition, the dry bulk newbuilding orderbook, extending up to 2028, was approximately 10.5% of the existing world dry bulk fleet as of the end of March 2025, according to Clarkson Research Services Limited, or Clarksons Research, and the orderbook may increase further in proportion to the existing fleet. Even though the overall level of the orderbook has declined over the past years, an over-supply of dry bulk vessel capacity could depress the current charter rates. Factors that influence the supply of vessel capacity include:


 •
the number of newbuilding orders and deliveries, including delays in new vessel deliveries;


•
the number of shipyards and their ability to deliver vessels;


•
potential disruption, including supply chain disruptions, of shipping routes due to accidents or political events;


•
scrapping and recycling rate of older vessels;


•
vessel casualties;


•
the price of steel and vessel equipment;


•
product imbalances (affecting the level of trading activity) and developments in international trade;


•
the number of vessels that are out of service, namely those that are laid-up, drydocked, awaiting repairs, or otherwise not available for hire;


•
vessels’ average speed;


•
technological advances in vessel design and capacity;


•
availability of financing for new vessels and shipping activity;


•
the imposition of sanctions, tariffs, trade barriers or embargos;


•
changes in national or international regulations that may effectively cause reductions in the carrying capacity of vessels or early obsolescence of tonnage;


•
changes in environmental and other regulations that may limit the useful life of vessels;


•
port or canal congestion;


•
changes in interest or inflation rates;


•
changes in market conditions, including general domestic and international political conditions or events, including trade wars, acts of hostility or potential, threatened, or ongoing war including between Russia and Ukraine (and related sanctions), the war between Israel and Hamas, and China and Taiwan, the conflict between Israel and Hezbollah, the Houthi crisis in the Red Sea, and the tensions between Israel and Iran, tensions between the U.S. and China, the U.S. and Panama and the U.S. and the European Union and NATO members; and


•
changes in global and regional economic and political conditions, including the provision or removal of economic stimulus measures meant to counteract the effects of sudden market disruptions due to financial, economic or health crises.

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In addition to the prevailing and anticipated charter rates, factors that affect the rates of newbuilding, scrapping, and laying-up include newbuilding prices, secondhand vessel values in relation to scrap prices, costs of bunkers and other operating costs, costs associated with classification society surveys, normal maintenance costs, insurance coverage costs, the efficiency and age profile of the existing dry bulk fleet in the market, and government and industry regulation of maritime transportation practices, particularly environmental protection laws and regulations. These factors influencing the supply of and demand for shipping capacity are outside of our control, and we may not be able to correctly assess the nature, timing, and degree of changes in industry conditions.

If dry bulk vessel capacity increases but the demand for vessel capacity does not increase or increases at a slower rate, charter rates could materially decline, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

Outbreaks of epidemic and pandemic diseases and any relevant governmental responses thereto could adversely affect our business, results of operations, or financial condition.

Global public health threats, such as the COVID-19 outbreak, influenza, and other highly communicable diseases or viruses, outbreaks which have from time to time occurred in various parts of the world in which we operate, including China, could adversely impact our operations, as well as the operations of our customers.

For example, the outbreak of COVID-19 caused severe global disruptions, with governments in affected countries imposing travel bans, quarantines and other emergency public health measures. Restrictions and future prevention and mitigation measures against outbreaks of epidemic and pandemic diseases, such as travel restrictions and temporarily closing business, are likely to have an adverse impact on global economic conditions, which could materially and adversely affect our future operations. As a result of such measures, our vessels may not be able to call on or disembark from ports located in regions affected by the outbreak. The COVID-19 pandemic also, among other things, caused factory closures and restrictions on travel, as well as labor shortages or lack of berths, delays and uncertainties relating to newbuildings, drydockings and vessel inspections, shortages or a lack of access to required spare parts and other functions of shipyards. Other future disease outbreaks or COVID-19 variants may cause us to experience severe operational disruptions and delays, unavailability of normal port infrastructure and services including limited access to equipment, critical goods and personnel, disruptions to crew changes, quarantine of ships and/or crew, counterparty solidity, closure of ports and custom offices, as well as disruptions in the supply chain and industrial production, which may lead to reduced cargo demand, among other potential consequences attendant to epidemic and pandemic diseases.

The extent to which our business, results of operations, cash flows, financial condition, financings, value of our vessels, and ability to pay dividends may be negatively affected by future pandemics, epidemics, or other outbreaks of infectious diseases is highly uncertain and will depend on numerous evolving factors that we cannot predict, including, but not limited to, (i) the duration and severity of the infectious disease outbreak; (ii) the imposition of restrictive measures to combat the outbreak and slow disease transmission; (iii) the introduction of financial support measures to reduce the impact of the outbreak on the economy; (iv) shortages or reductions in the supply of essential goods, services, or labor; and (v) fluctuations in general economic or financial conditions tied to the outbreak, such as a sharp increase in interest rates or reduction in the availability of credit. This impact could be material and adverse.

We are currently mostly dependent on index-linked charters, while a smaller part of our fleet is employed on a spot voyage basis. Any decrease in spot freight charter rates or indices in the future may adversely affect our earnings.

As of the date of this report, the majority of our vessels are employed under time charters which have a charter hire calculated at an index-linked rate based on the Baltic Capesize Index, or BCI, and the Baltic Panamax Index, or BPI, respectively. Furthermore, we may operate any other vessels we may acquire on a spot voyage basis, or on index-linked or fixed rate time charters.

Although the number of vessels in our fleet that are employed on spot voyages or have index-linked or fixed rate charters will vary from time to time, dictated by a multitude of factors and the chartering opportunities before us, we anticipate that a significant portion of our fleet will be affected by the spot freight market or the relevant index rates. As a result, our financial performance will be significantly affected by conditions in the spot freight market or the relevant index rates and only vessels that operate under fixed-rate time charters would, during the period in which such vessels operate under such time charters, provide a fixed source of revenue to us. If future spot charter rates or indices decline, we may be unable to operate our vessels profitably, and our business, results of operations, cash flows, and financial condition will be significantly affected.

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Historically, spot charter rates and dry bulk charter indices have been volatile as a result of the many conditions and factors that can affect the price of, supply of and demand for dry bulk capacity. The successful operation of our vessels in the competitive spot charter market depends upon, among other things, fixing profitable spot voyages and minimizing, to the extent possible, time spent waiting for charters and time spent traveling unladen to pick up cargo. The spot market is very volatile, and, in the past, there have been periods when spot rates declined below the operating cost of vessels. If future spot charter rates or the relevant index rates decline, we may be unable to operate our vessels trading in the spot market or our BCI-linked charters profitably or meet our other obligations, including payments on indebtedness.

Furthermore, as charter rates for spot charters are usually fixed for a single voyage, which may last up to several weeks, during periods in which spot charter rates are rising, we will generally experience delays in realizing the benefits from such increases. Spot charter rates are also not uniform globally and may vary substantially between different geographical regions; therefore, realizing opportunities in the spot market will also depend on the geographical location of our vessels at any given time.

Under a fixed rate time charter, if spot or short-term time charter rates fall significantly below the charter rates that our charterers are obligated to pay us, the charterers may have an incentive to default on, or attempt to renegotiate the charter, which would affect our ability to operate our vessels profitably. Additionally, if our charterers fail to pay their obligations, we would have to attempt to re-charter our vessels at lower charter rates, which would affect our ability to comply with our loan covenants and operate our vessels profitably. If we are not able to comply with our loan covenants and our lenders choose to accelerate our indebtedness and foreclose their liens, we could be required to sell vessels in our fleet and our ability to continue to conduct our business would be impaired. Meanwhile, under a fixed rate time charter, we may be unable to realize the benefits of market upswings and successfully take advantage of comparably favorable opportunities.

If economic conditions throughout the world decline, it will negatively impact our results of operations, financial condition, and cash flows, and could cause the market price of our common shares to decline.

Various macroeconomic factors, including rising inflation, higher interest rates, global supply chain constraints, and the effects of overall economic conditions and uncertainties, such as those resulting from the current and future conditions in the global financial markets, could adversely affect our business, results of operations, financial condition, and ability to pay dividends. Inflation and rising interest rates may negatively impact us by increasing our operating costs and our cost of borrowing. Interest rates, the liquidity of the credit markets, and the volatility of the capital markets could also affect the operation of our business and our ability to raise capital on favorable terms, or at all. Adverse economic conditions also affect demand for goods and oil. Reduced demand for these or other products could result in significant decreases in rates we obtain for chartering our vessels. In addition, the cost for crew members, oils and bunkers, and other supplies may increase. Furthermore, we may experience losses on our holdings of cash and investments due to failures of financial institutions and other parties. Difficult economic conditions may also result in a higher rate of losses on our accounts receivable due to credit defaults. As a result, downturns in the worldwide economy could have a material adverse effect on our business, results of operations, financial condition, and ability to pay dividends.

The world economy continues to face a number of actual and potential challenges, including the war between Ukraine and Russia and between Israel and Hamas, tensions between Israel and Iran, tensions in the Red Sea or Russia and NATO tensions, China and Taiwan disputes, the United States and China trade relations, tensions between the U.S. and NATO members, tensions between the U.S. and Panama, instability between Iran and the West, hostilities between the United States and North Korea, political unrest and conflict in the Middle East, the South China Sea region and other geographic countries and areas, terrorist or other attacks (including threats thereof) around the world, war (or threatened war) or international hostilities, epidemics or pandemics, and banking crises or failures. See also “—Outbreaks of epidemic and pandemic diseases and any relevant governmental responses thereto could adversely affect our business, results of operations, or financial condition.” In addition, the continuing war in Ukraine, the length and breadth of which remains highly unpredictable, has led to increased economic uncertainty amidst fears of a more generalized military conflict or significant inflationary pressures, due to the increases in fuel and grain prices following the sanctions imposed on Russia. Furthermore, it is difficult to predict the intensity and duration of the war between Israel and Hamas or the Houthi rebel attacks on vessels transiting the Red Sea and their impact on shipping and the world economy is uncertain. Although a cease-fire declared between Israel and Hamas on January 15, 2025, heightened regional tension and renewed conflict in Gaza and Yemen developed in March 2025, which may lead to continued attacks on vessels transiting the Red Sea. If such conditions are sustained, the longer-term net impact on the dry bulk market and our business would be difficult to predict with any degree of accuracy. Such events may have unpredictable consequences and contribute to instability in the global economy or cause a decrease in worldwide demand for certain goods and, thus, shipping. We cannot predict how long current market conditions will last.

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In Europe, concerns regarding the possibility of sovereign debt defaults by EU member countries, including Greece, although generally alleviated, have in the past disrupted financial markets throughout the world, and may lead to weaker consumer demand in the EU, the U.S. and other parts of the world. The U.S. implementation of tariffs and related countermeasures taken by impacted foreign countries further increases the risk of additional trade protectionism. The withdrawal of the United Kingdom from the EU, or Brexit, or similar events in other jurisdictions, could impact global markets, including foreign exchange and securities markets; any resulting changes in currency exchange rates, tariffs, treaties and other regulatory matters could in turn adversely impact our business, results of operations, cash flows, and financial condition.

Protectionist developments, or the perception that they may occur, may have a material adverse effect on global economic conditions, and may significantly reduce global trade. Moreover, increasing trade protectionism may cause an increase in (i) the cost of goods exported from regions globally, particularly from the Asia-Pacific region, (ii) the length of time required to transport goods and (iii) the risks associated with exporting goods. Such increases may further reduce the quantity of goods to be shipped, shipping time schedules, voyage costs and other associated costs, which could have an adverse impact on our charterers’ business, results of operations and financial condition and could thereby affect their ability to make timely charter hire payments to us and to employ our vessels. This could have a material adverse effect on our business, results of operations, cash flows and financial condition.

In addition, the recent economic slowdown in the Asia Pacific region, particularly in China, may exacerbate the effect of the weak economic trends in the rest of the world. Before the global economic financial crisis that began in 2008, China had one of the world’s fastest growing economies in terms of gross domestic product, or GDP, which had a significant impact on shipping demand. China’s GDP growth rate recovered from 3.0% in 2022 to 5.2% in 2023, but the economy continued to be weighed down by the ongoing crisis in the property market. For the year ended December 31, 2024, China’s GDP growth rate declined slightly to approximately 5.0%. Although the Chinese government has implemented economic stimulus measures, it is possible that China and other countries in the Asia Pacific region will continue to experience volatile, slowed, or even negative economic growth in the near future. Changes in the economic conditions of China, and changes in laws or policies adopted by its government or the implementation of these laws and policies by local authorities, including with regards to tax matters and environmental concerns (such as achieving carbon neutrality), could affect our vessels that are either chartered to Chinese customers or that call to Chinese ports, our vessels that undergo drydocking at Chinese shipyards and Chinese financial institutions that are generally active in ship financing, and could have a material adverse effect on our business, results of operations, cash flows, and financial condition.

The U.S. and global capital markets, including credit markets, continue to experience volatility and uncertainty, and there is a risk that the U.S. federal government and state governments and European authorities may continue to implement a broad variety of governmental action and/or introduce new financial market regulations. Global financial markets and economic conditions have been, and continue to be, volatile and we face risks associated with the trends in the global economy, such as changes in interest rates, instability in the banking and securities markets around the world, the risk of sovereign defaults, and reduced levels of growth, among other factors. Major market disruptions and the current adverse changes in market conditions and regulatory climate worldwide may adversely affect our business, results of operations or impair our ability to borrow under our loan agreements or any future financial arrangements we may enter into contemplating borrowing from the public and/or private equity and debt markets. Many lenders increased interest rates, enacted tighter lending standards, refused to refinance existing debt at all or on terms similar to current debt and reduced (or in some cases ceased to provide) funding to borrowers and other market participants, including equity and debt investors and, in some cases, have been unwilling to provide financing on attractive terms or even at all. While recent developments in the global credit markets have been supportive of borrowing and refinancing, we cannot be certain that financing will be available if needed and to the extent required, on acceptable terms or at all. In the absence of available financing or financing on favorable terms, we may be unable to complete vessel acquisitions, take advantage of business opportunities, or respond to competitive pressures.

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Significant tariffs or other restrictions imposed on imports by the U.S. and related countermeasures taken by impacted foreign countries could have a material adverse effect on our operations and financial results.

If significant tariffs or other restrictions are imposed on imports by the U.S. and related countermeasures are taken by impacted foreign countries, our business, including results of operations, cash flows and financial condition, may be adversely affected. In January 2025, during the initial days of President Trump's second term, the U.S. announced the imposition of additional substantial tariffs on imports from various countries, including China, Canada and Mexico, and the subject countries have imposed or indicated their intention to impose counter measures. In February 2025, the U.S. imposed tariffs of 10% on all imported goods from China, followed by an additional 10% tariff in March 2025. The U.S. also imposed a 25% tariff on all steel and aluminum imports, beginning in March 2025. On February 13, 2025, President Trump ordered his trade advisers to come up with “reciprocal” tariffs on U.S. trade partners to retaliate against taxes, tariffs, regulations and subsidies and on April 2, 2025, announced new tariffs on many U.S. trading partners, including a universal baseline tariff of 10% on all imported goods, and country specific tariffs such as an additional 34% tax on imports from China (leading to an effective rate of 54% when combined with existing tariffs) and 20% on products from the E.U. Specific products that are being tariffed, such as automobiles, were to be exempted from the new tariffs, and tariffs on products such as pharmaceutical drugs were to be announced at a later date. Following a period of market turbulence, on April 9, 2025, President Trump announced a 90-day pause to the tariffs announced on April 2, 2025 for most countries. Countries subject to the pause on the tariffs are still to be subject to the baseline 10% tariff. This consequently lowers the tariff rate for the E.U., Japan, and South Korea, among other countries. However, President Trump announced an increased tariff rate against Chinese imports of a minimum 145%. These and other tariffs and countermeasures could increase the cost of raw materials and components that we transport, disrupt global supply chains and create additional operational challenges. If further tariffs are imposed on a broader range of imports, or if retaliatory trade measures are enacted by affected countries, these factors could reduce demand for commodities carried by sea, result in the loss of customers and harm our competitive position in key markets. Additionally, ongoing trade tensions and uncertainty regarding future trade policies could negatively impact global economic conditions and consumer confidence, further affecting our business performance.

Political instability, terrorist attacks or other attacks, war, and international hostilities could affect our business, results of operations, cash flows and financial condition.

We conduct most of our operations outside of the United States and our business, results of operations, cash flows, financial condition and available cash may be adversely affected by changing economic, political and governmental conditions in the countries and regions where our vessels or vessels we may acquire are employed or registered. Moreover, we operate in a sector of the economy that is likely to be adversely impacted by the effects of political uncertainty and armed conflicts, including the war between Ukraine and Russia and between Israel and Hamas and Hezbollah, Russia and NATO tensions, U.S. and NATO tensions, China and Taiwan disputes, U.S. and China trade relations, instability between Iran and the West, hostilities between the U.S. and North Korea and the U.S. and Panama, political unrest and conflicts in the Middle East, the South China Sea region, the Red Sea region (including missile attacks controlled by the Houthis on vessels transiting the Red Sea or Gulf of Aden), and other countries and geographic areas, geopolitical events, such as Brexit, or another withdrawal from the EU, terrorist or other attacks (or threats thereof) around the world and war (or threatened war) or international hostilities. Such events may contribute to further economic instability in the global financial markets and international commerce and could also adversely affect our ability to obtain additional financing on terms acceptable to us or at all.

The war between Russia and Ukraine may lead to further regional and international conflicts or armed action. This war has disrupted supply chains and caused instability in the energy markets and the global economy, with effects on shipping freight rates, which have experienced volatility. The U.S. and the United Kingdom, among other countries, as well as the EU, have announced unprecedented economic sanctions and other penalties against certain persons, entities, and activities connected to Russia, including removing Russian-based financial institutions from the Society for Worldwide Interbank Financial Telecommunication payment system and restricting imports of Russian oil, liquefied natural gas, and coal. These sanctions have caused supply disruptions in the oil and gas markets and could continue to cause significant volatility in energy prices, which could result in increased inflation and may trigger a recession in the U.S. and China, among other regions. While much uncertainty remains regarding the global impact of the war in Ukraine, it is possible that such tensions could adversely affect our business, financial condition, results of operations, and cash flows.

The ongoing war between Russia and Ukraine could result in the imposition of further economic sanctions by the United States, the United Kingdom, the European Union, or other countries against Russia, trade tariffs, or embargoes with uncertain impacts on the markets in which we operate. In addition, the U.S. and certain other NATO countries have been supplying Ukraine with military aid. U.S. officials have also warned of the increased possibility of Russian cyberattacks, which could disrupt the operations of businesses involved in the drybulk industry, including ours, and could create economic uncertainty particularly if such attacks spread to a broad array of countries and networks. Although Ukraine and Russia reached an agreement to extend an arrangement allowing shipment of grain from Ukrainian ports through a humanitarian corridor in the Black Sea in November 2022, Russia terminated this agreement in July 2023. While much uncertainty remains regarding the global impact of the war in Ukraine, it is possible that such tensions could adversely affect our business, financial condition, results of operations, and cash flows.

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Continuing war and recent developments in Ukraine, the Middle East, tensions between the U.S. and Iran, the war between Israel and Hamas, and the conflict in the Red Sea, as well as other geographic countries and areas, terrorist or other attacks, and war (or threatened war) or international hostilities, such as the ones currently in progress between Russia and Ukraine, Israel and Hamas, China and Taiwan, and the U.S. and North Korea, have recently and may in the future lead to armed conflict or acts of terrorism around the world, which may contribute to further economic instability in the global financial markets and international commerce. These uncertainties could also adversely affect our ability to obtain additional financing on terms acceptable to us or at all.

Past terrorist attacks and the ongoing threat of future incidents worldwide continue to instigate uncertainty in the global financial markets, potentially affecting our business, operating outcomes and financial condition. Recent acts of terror perpetrated by Houthi rebels in the Red Sea region further heighten concerns about the impact on maritime transportation along key routes, such as the Red Sea route, affecting our shipping operations. Although our business is not directly impacted by the war between Israel and Hamas, the related missile attacks by the Houthi regime in the Red Sea area has led to the diversion of a large part of the world fleet away from the Red Sea, increasing the ton-mile demand for most shipping sectors, including dry bulk, and resulting in higher freight rates. Rerouting away from the most convenient route for connecting East trade to the West and vice versa may, however, lead to increased operational costs and higher revenues. In case our vessels trade or transit via the Red Sea, we may incur increased insurance costs. While much uncertainty remains regarding the global impact of the war between Israel and Hamas, it is possible that such tensions could result in the eruption of further hostilities in other regions, including the Red Sea, and could adversely affect our business, financial condition, results of operations and cash flows. A cease-fire between Israel and Hamas was declared on January 15, 2025, but there is no certainty that the cease-fire will continue. Further President Trump’s proposal to annex Gaza has raised fears that Houthi militant group could renew its threat against commercial ships crossing the Red Sea, after declaring in January 2025 that it would stop targeting most vessels following the Israel-Hamas ceasefire.

Ongoing conflicts and recent developments in regions such as Ukraine, Russia, North Korea, Myanmar, and the Middle East (including Iran, Iraq, Israel, Palestine, Syria, the Persian Gulf, Yemen), coupled with the presence of the United States or other armed forces in the Middle East, may lead to additional acts of terrorism and armed conflict globally. These events may contribute to heightened economic instability in the worldwide financial markets. Significant tariffs or other restrictions being imposed on imports by the U.S. and related countermeasures taken by impacted foreign countries, may be adversely affect our business, results of operations, cash flows, and financial condition. See “— Significant tariffs or other restrictions imposed on imports by the U.S. and related countermeasures taken by impacted foreign countries could have a material adverse effect on our operations and financial results.”

In the past, political conflicts have also resulted in attacks on vessels, mining of waterways, and other efforts to disrupt international shipping, particularly in the Arabian Gulf region. The ongoing war in Ukraine has resulted in missile attacks on commercial vessels in the Black Sea and the recent outbreak of conflict in the Red Sea has also resulted in missile attacks on vessels. Acts of terrorism and piracy have also affected vessels trading in regions such as the Gulf of Guinea, the Red Sea, the Gulf of Aden off the coast of Somalia, and the Indian Ocean. Any of these occurrences could have a material adverse impact on our future performance, results of operations, cash flows, financial position, and our ability to pay cash distributions to our shareholders.

Risks associated with operating ocean-going vessels could affect our business and reputation, which could adversely affect our revenues and expenses.

The operation of an ocean-going vessel carries inherent risks. These risks include the possibility of:


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crew strikes and/or boycotts;


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acts of God;


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damage to or destruction of vessels due to marine disaster;


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terrorism, piracy or other detentions;


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environmental accidents;


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cargo and property losses or damage; and


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business interruptions caused by mechanical failure, grounding, fire, explosions and collisions, human error, war, political action in various countries, labor strikes, epidemics or pandemics, adverse weather conditions or other circumstances or events.

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Any of these circumstances or events could increase our costs or lower our revenues. Such circumstances could result in death or injury to persons, loss of property or environmental damage, delays in the delivery of cargo, loss of revenues from or termination of charter contracts, governmental fines, penalties, or restrictions on conducting business, litigation with our employees, customers, or third parties, higher insurance rates, and damage to our reputation and customer relationships, generally, market disruptions, delays, and rerouting and could also subject us to litigation. Epidemics and other public health incidents may also lead to crew member illness, which can disrupt the operations of our vessels, or result in the imposition of public health measures, which may prevent our vessels from calling on ports or discharging cargo in the affected areas or in other locations after having visited the affected areas. Although we maintain hull and machinery and war risks insurance, as well as protection and indemnity insurance, which may cover certain risks of loss resulting from such occurrences, our insurance coverage may be subject to deductibles and caps or may not cover such losses, and any of these circumstances or events could increase our costs or lower our revenues. Furthermore, the involvement of our vessels and other vessels we may acquire in an environmental disaster may harm our reputation as a safe and reliable vessel owner and operator. Any of these circumstances or events could have a material adverse effect on our business, results of operations, and financial condition, as well as our cash flows.

If our vessels suffer damage, they may need to be repaired at a drydocking facility. The time and costs of repairs are unpredictable and may be substantial. We may have to pay repair costs that our insurance does not cover in full. The loss of earnings while our vessels are being repaired and repositioned, as well as the actual cost of these repairs and repositioning, would decrease our earnings. In addition, space at drydocking facilities is sometimes limited and not all drydocking facilities are conveniently located. We may be unable to find space at a suitable drydocking facility and be forced to travel to a drydocking facility that is not conveniently located to our vessels’ positions. The loss of earnings while these vessels are forced to wait for space or to travel to more distant drydocking facilities, or both, would decrease our earnings.

Increases in fuel prices may adversely affect our profits.

The cost of fuel is a significant factor in negotiating voyage freight rates, although we generally do not directly bear the cost of fuel for vessels operating on time charters. As a result, an increase in the price of fuel may adversely affect our profitability if freight rates fail to rise to the extent required to cover a rise in the cost of fuel. The price and supply of fuel is unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for oil and gas, actions by members of the Organization of the Petroleum Exporting Countries, and other oil and gas producers, the imposition of new regulations adopted by the International Maritime Organization, or IMO, war and unrest in oil producing countries and regions, regional production patterns, and environmental concerns and regulations. While fuel prices remained generally lower in 2024 and 2023 as compared to 2022, fuel has and may become much more expensive in the future, including as a result of the ongoing war in Ukraine and the sanctions against Russia, the imposition of tariffs and trade restrictions, the imposition of sulfur oxide emissions limits in January 2020, and reductions of carbon emissions from January 2023 under new regulations adopted by the IMO, which may reduce the profitability and competitiveness of our business versus other forms of transportation, such as truck or rail.

Upon redelivery of any vessels at the end of a period time charter or a voyage charter, we may be obligated to repurchase bunkers on board at prevailing market prices, or purchase bunkers to refuel the vessel in case of a voyage charter, which could be materially higher than fuel prices at the inception of the charter period. However, given the current time charter agreements of our vessels and our chartering strategy, this cost is projected to be immaterial in the short to medium term. If in the future we decide to operate vessels on a voyage basis, then fuel would be the largest expense that we would incur with respect to vessels operating on voyage charter. Voyage charter contracts generally provide that the vessel owner bears the cost of fuel in the form of bunkers, which is a material operating expense, while under time charter agreements fuel expenses are borne by the charterers. We currently cannot guarantee that we will continue to employ our vessels on a time charter basis, or that we will hedge our fuel costs on any prospective future voyage charters. As a result, an increase in the price of fuel may negatively affect our profitability and cash flows in the future.

Our revenues are subject to seasonal fluctuations, which could affect our results of operations and ability to service our debt or pay dividends.

We operate in markets that have historically exhibited seasonal variations in demand and, as a result, in charter hire rates. This seasonality may result in quarter-to-quarter volatility in our results of operations. The dry bulk shipping market is typically stronger in the fall and winter months in anticipation of increased consumption of coal and other raw materials in the northern hemisphere during the winter months. In addition, unpredictable weather patterns in these months tend to disrupt vessel schedules and supplies of certain commodities. This seasonality should not affect our operating results if our vessels are employed on fixed rate period time charters, but because the majority of our vessels are employed (and vessels we may acquire may be employed) in the spot voyage market, or on index-linked charters, seasonality may increase the volatility of, and materially affect, our operating results and cash flows, as well as our ability to pay dividends, if any, in the future.

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Climate change and greenhouse gas restrictions may be imposed.

Due to concern over the risk of climate change, a number of countries and the IMO have adopted, or are considering the adoption of, regulatory frameworks to reduce greenhouse gas emissions. These regulatory measures may include, among others, the adoption of cap and trade regimes, carbon taxes, increased efficiency standards and incentives or mandates for renewable energy. For instance, the IMO imposed a global 0.5% sulfur cap on marine fuels, down from the previous cap of 3.5%, which came into force on January 1, 2020. In addition, in July 2023, the IMO adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships with enhanced targets to tackle harmful emissions and, which identifies “levels of ambition” towards reducing greenhouse gas emissions, including (1) decreasing the carbon intensity from ships through the implementation of further phases of EEDI for new ships; (2) reducing carbon dioxide emissions per transport work, as an average across international shipping, by at least 40% by 2030 compared to 2008 emission levels; and (3) pursuing net-zero greenhouse gas emissions by or around 2050 while pursuing efforts towards phasing them out entirely. At the conclusion of MEPC 82, a draft legal text was used as a basis for ongoing talks about mid-term GHG reduction measures, which are expected to be adopted in 2025. The proposed mid-term measures include a goal-based marine fuel standard, phasing in the mandatory use of fuels with less GHG intensity, and a global GHG emission pricing mechanism. These regulations and any additional regulations addressing similar goals could cause us to incur additional substantial expenses and could have a material adverse effect on our business, operating results, cash flows and financial condition and our ability to pay dividends. See “Item 4. Information on the Company—B. Business Overview—Environmental and Other Regulations” for a discussion of these and other environmental regulations applicable to our operations.

In addition, although the emissions of greenhouse gases from international shipping currently are not subject to the Kyoto Protocol to the United Nations Framework Convention on Climate Change (this task was delegated under the Kyoto Protocol to the IMO for action), which required adopting countries to implement national programs to reduce emissions of certain gases, a new treaty may be adopted in the future that includes restrictions on shipping emissions. Compliance with changes in laws, regulations and obligations relating to climate change could increase our costs related to operating and maintaining our vessels and require us to install new emission controls, acquire allowances or pay taxes related to our greenhouse gas emissions, or administer and manage a greenhouse gas emissions program. Revenue generation and strategic growth opportunities may also be adversely affected.

Furthermore, on January 1, 2024, the EU Emissions Trading Scheme, or the ETS, for ships sailing into and out of EU ports came into effect, and the FuelEU Maritime Regulation came into effect on January 1, 2025. The ETS applies gradually over the period from 2024 to 2026. 40% of allowances would have to be surrendered in 2025 for the year 2024; 70% of allowances would have to be surrendered in 2026 for the year 2025; and 100% of allowances would have to be surrendered in 2027 for the year 2026. Compliance is on a companywide (rather than per ship) basis and “shipping company” is defined widely to capture both the ship owner and any contractually appointed commercial operator/ship manager/bareboat charterer who assumes all duties and responsibilities for the ship under the ISM Code, as well as the responsibility for full compliance under the ETS. If the latter contractual arrangement is entered into this needs to be reflected in a certified mandate signed by both parties and presented to the administrator of the scheme. The cap under the ETS would be set by taking into account EU MRV system emissions data for the years 2018 and 2019, adjusted, from year 2021 and is to capture 100% of the emissions from intra-EU maritime voyages; 100% of emissions from ships at berth in EU ports and 50% of emissions from voyages which start or end at EU ports (but the other destination is outside the EU). Furthermore, the newly passed EU Directive 2023/959 makes clear that all maritime allowances would be auctioned and there will be no free allocation. 78.4 million emissions allowances are to be allocated specifically to maritime. If we do not have allowances, we will be forced to purchase allowances from the market, which can be costly. To prepare for and manage the administrative aspects of EU ETS compliance, we have made significant investments in new systems, including personnel, data management, cost recovery mechanisms, revised service agreement terms, and transparent emissions reporting procedures. However, the cost of future cost of compliance and of our future EU emissions and costs to purchase an allowance for emissions (if we must purchase in order to comply) are unknown and difficult to predict, and are based on a number of factors, including the size of our fleet, our trips within and to and from the EU, and the prevailing cost of allowances.

Additionally, on July 25, 2023, the European Council of the European Union adopted the Fuel EU Maritime Regulation 2023/1805 (“FuelEU”) under the FuelEU Initiative of its “Fit-for-55” package which sets limitations on the acceptable yearly greenhouse gas intensity of the energy used by covered vessels. Among other things, FuelEU requires that greenhouse gas intensity of fuel used by covered vessels is reduced by 2% starting January 1, 2025, with additional reductions contemplated every five years (up to 80% by 2050). Shipping companies may enter into pooling mechanisms with other shipping companies in order to achieve compliance, bank surplus emissions and borrow compliance balances from future years. A FuelEU Document of Compliance is required to be kept on board a vessel to show compliance by June 30, 2026. Both the ETS and FuelEU schemes have significant impacts on the management of the vessels calling to EU ports, by increasing the complexity and monitoring of, and costs associated with the operation of vessels and affecting the relationships with our time charterers.

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Adverse consequences of climate change, including growing public concern about the environmental impact of climate change, may also adversely affect demand for our services. For example, increased regulation of greenhouse gases or other concerns relating to climate change may reduce the demand for coal in the future, one of the primary cargoes carried by our vessels. In addition, the physical effects of climate change, including changes in weather patterns, extreme weather events, rising sea levels, and scarcity of water resources, may negatively impact our operations. Any long-term economic consequences of climate change could have a significant financial and operational adverse impact on our business that we cannot predict with certainty at this time.

Technological developments which affect global trade flows and supply chains are challenging some of our largest customers and may therefore affect our business and results of operations.

By reducing the cost of labor through automation and digitization, including by means of new technologies in artificial intelligence and machine learning, among others, and empowering consumers to demand goods whenever and wherever they choose, technology is changing the business models and production of goods in many industries, including those of some of our largest customers. Consequently, supply chains are being pulled closer to the end-customer and are required to be more responsive to changing demand patterns. As a result, fewer intermediate and raw inputs are traded, which could lead to a decrease in shipping activity. If automation and digitization become more commercially viable and/or production becomes more regional or local, total containerized trade volumes would decrease, which would adversely affect demand for our services. Supply chain disruptions caused by geopolitical and economic events, pandemics, rising tariff barriers and environmental concerns also accelerate these trends.

Our operations may be adversely impacted by severe weather, including as a result of climate change.

Tropical storms, hurricanes, typhoons, and other severe marine weather events could result in the suspension of operations at the planned ports of call for our vessels and require significant deviations from planned routes. In addition, climate change could result in an increase in the frequency and severity of these extreme weather events. The closure of ports, rerouting of vessels, damage of production facilities, as well as other delays caused by increasing frequency of severe weather, could stop operations or shipments for indeterminate periods and have a material adverse effect on our business, results of operations and financial condition.

Tax law changes may result in significant additional taxes to us.

Tax law changes may result in significant additional taxes to us. For example, the Organization for Economic Cooperation and Development (the “OECD”) published a “Programme of Work,” which was divided into two pillars. Pillar One focused on the allocation of group profits among taxing jurisdictions based on a market-based concept rather than the historical “permanent establishment” concept. Pillar Two, among other things, operates to impose a minimum tax rate of 15% calculated on a jurisdictional basis. More than 130 countries have signed on to the Pillar Two rules released in December 2021 that, among other provisions, give the countries the right to “tax back” profit that is currently taxed below the minimum 15% rate. The framework calls for law enactment by OECD and G20 members in 2022 to take effect in 2023 and 2024. Presently, it is difficult to assess if and to what extent such changes will impact our tax burden. Further developments and unexpected implementation mechanics could adversely affect our effective tax rate or result in higher cash tax liabilities. Any requirement or legislation that requires us to pay more tax could have a material adverse effect on our business, results of operations, cash flows and financial condition and our ability to pay dividends.

Increased regulation and scrutiny of environmental, social and governance matters may impact our business and reputation.

In addition to the importance of their financial performance, companies are increasingly being judged by their performance on a variety of environmental, social and governance matters, or ESG, which are considered to contribute to the long-term sustainability of a company’s performance.

A variety of organizations measure the performance of companies on such ESG topics and the results of these assessments are widely publicized. In addition, investment in funds that specialize in companies that perform well in such assessments are increasingly popular and major institutional investors have publicly emphasized the importance of such ESG measures to their investment decisions. Topics taken into account in such assessments include, among others, the company’s efforts and impact on climate change and human rights, ethics, and compliance with laws, and the role of our board of directors in supervising various sustainability issues.

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We actively manage a broad range of such ESG matters, taking into consideration their expected impact on the sustainability of our business over time, and the potential impact of our business on society and the environment. As far as the environmental aspect is concerned, since 2018 we have commenced implementing technical and operational measures aiming to improve the energy efficiency of our vessels and in extension reduce the CO2 emissions of the fleet. During 2023 the attained EEXI for all our vessels have been calculated in accordance with regulation 23 of MARPOL Annex VI and the 2021 Guidelines on the method of calculation of the attained Energy Efficiency Existing Ship Index (EEXI) (resolution MEPC.333(76)) (EEXI Calculation Guidelines). All EEXI technical files containing the necessary information have been prepared in cooperation with the vessels’ recognized organizations, for which the on-board survey application is in progress. In addition, we have completed various biofuel trials in cooperation with leading charterers and operators. Moreover, we have installed ballast water treatment systems, Energy Saving Devices, including artificial intelligence assisted remote performance monitoring systems, applied Existing Vessel Design Index, or EVDI, upgrades, very low friction silicon hull paints and hydrodynamic performance improving technologies, which constitute examples of the environmental practices we have adopted and aim to continue adopting on most of our vessels. We participate in various environmental initiatives in our industry and technical committees promoting various ESG matters. We have also secured and entered into two sustainability-linked financings for five of our vessels. However, in light of investors’ increased focus on ESG matters, there can be no certainty that we will manage such issues successfully, or that we will successfully meet the industry’s or society’s expectations as to our proper role. Any failure or perceived failure by us in this regard could have a material adverse effect on our reputation and on our business, share price, financial condition, or results of operations, including the sustainability of our business over time.

On March 6, 2024, the SEC adopted final rules to enhance and standardize climate-related disclosures by public companies and in public offerings. The final rules were set to become effective on May 28, 2024, 60 days following publication of the adopting release in the Federal Register. However, these rules were challenged in federal courts, and, in April 2024, the SEC announced that it would voluntarily stay the effectiveness of the rules pending judicial review. On February 11, 2025, acting SEC Chair Mark Uyeda directed the Commission’s staff to pause their legal defense of the rules and request that the Court not schedule the case for argument.  On March 27, 2025, the SEC voted to end its defense of the rules and sent a letter to the Eight Circuit Court of Appeals withdrawing its defense of the rules. The rules remain in place (though not effective), unless the SEC formally withdraws or rescinds the rules, or the Eighth Circuit finds the rules invalid.

Moreover, from time to time, we may incur additional costs, establish and publicly announce goals and commitments in respect of certain ESG items. While we may create and publish voluntary disclosures regarding ESG matters from time to time, many of the statements in those voluntary disclosures are based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith. Such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters. If we fail to achieve or improperly report on our progress toward achieving our environmental goals and commitments, the resulting scrutiny from market participants or regulators could adversely affect our reputation and/or our access to capital.

Our vessels may call on ports located in or may operate in countries that are subject to restrictions or sanctions imposed by the United States, the European Union or other governments that could result in fines or other penalties imposed on us and may adversely affect our reputation and the market price of our common shares.

During the year ended December 31, 2024, none of our vessels called on ports located in countries subject at that time to comprehensive sanctions and embargoes imposed by the U.S. government or countries identified by the U.S. government or other authorities as state sponsors of terrorism; however, our vessels may call on ports in these countries from time to time in the future on our charterers’ instructions, subject to any applicable insurance arrangements and prior approvals, if required. The U.S. sanctions and embargo laws and regulations vary in their application, as they do not all apply to the same covered persons or proscribe the same activities, and such sanctions and embargo laws and regulations may be amended or strengthened over time.

We believe that we are currently in compliance with all applicable sanctions and embargo laws and regulations. In order to maintain compliance, we monitor and review the movement of our vessels on a daily basis.

We endeavor to provide that all or most of our future charters include provisions and trade exclusion clauses prohibiting the vessels from calling on ports where there is an existing U.S. embargo. Furthermore, as of the date hereof, neither the Company nor its subsidiaries have entered into or have any plans to enter into, directly or indirectly, any contracts, agreements or other arrangements with the governments of Iran, Syria, North Korea, Cuba or any entities controlled by the governments of these countries.

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Due to the nature of our business and the evolving nature of the foregoing sanctions and embargo laws and regulations, there can be no assurance that we will be in compliance at all times in the future, particularly as the scope of certain laws may be unclear and may be subject to changing interpretations. Any such violation could result in fines, penalties or other sanctions that could severely impact our ability to access U.S. capital markets and conduct our business, and could result in some investors deciding, or being required, to divest their interest, or refrain from investing, in us. In addition, certain institutional investors may have investment policies or restrictions that prevent them from holding securities of companies that have contracts with countries identified by the U.S. government as state sponsors of terrorism. The determination by these investors not to invest in, or to divest from, our common shares may adversely affect the price at which our common shares trade. Moreover, our charterers may violate applicable sanctions and embargo laws and regulations as a result of actions that do not involve us or our vessels, and those violations could in turn negatively affect our reputation. In addition, our reputation and the market for our securities may be adversely affected if we engage in certain other activities, such as entering into charters with individuals or entities in countries subject to U.S. sanctions and embargo laws that are not controlled by the governments of those countries, or engaging in operations associated with those countries pursuant to contracts with third parties that are unrelated to those countries or entities controlled by their governments.

Sulfur regulations to reduce air pollution from ships have required retrofitting of vessels and may cause us to incur significant costs.

Since January 1, 2020, IMO regulations have required vessels to comply with a global cap on the sulfur in fuel oil used on board of 0.5%, down from the previous cap of 3.5%. The interpretation of “fuel oil used on board” includes use in main engine, auxiliary engines and boilers. Compliance with this regulation is achieved by (i) using 0.5% sulfur fuels on board, which are available at a higher cost; (ii) installing “scrubbers” for cleaning of the exhaust gas; or (iii) retrofitting vessels to be powered by liquefied natural gas (LNG), which may not yet be an economically viable option due to the lack of supply network and high costs involved in this process. Our vessels comply by burning low sulfur fuel (0.5% or 0.1%). We have further developed ship specific implementation plans for safeguarding the smooth transition with the usage of compliant fuels for vessels we may acquire that will not be equipped with scrubbers. However, due to the fact that the Mediterranean Sea will become a 0.1% sulfur emission control area by May 1, 2025, we may consider installing scrubbers in  some of our vessels, if such investment is deemed beneficial. Costs of ongoing compliance may have a material adverse effect on our future performance, results of operations, cash flows and financial position. See “Business—Environmental and Other Regulations—International Maritime Organization.”

We are subject to regulation and liability under environmental laws that could require significant expenditures and affect our cash flows and net income.

Our business and the operation of our vessels are materially affected by government regulation in the form of international conventions, national, state and local laws and regulations in force in the jurisdictions in which the vessels operate, as well as in the country or countries of their registration, including those governing oil spills, discharges to air and water, ballast water management, and the handling and disposal of hazardous substances and wastes. These requirements include, but are not limited to, EU regulations, the U.S. Oil Pollution Act of 1990, or OPA, the U.S. Comprehensive Environmental Response, Compensation and Liability Act of 1980, or CERCLA, the U.S. Clean Air Act, including its amendments of 1977 and 1990, or the CAA, the U.S. Clean Water Act, or the CWA, the U.S. Maritime Transportation Security Act of 2002, or the MTSA, and regulations of the IMO. These include, but are not limited to, the International Convention on Civil Liability for Oil Pollution Damage of 1969, as from time to time amended and generally referred to as CLC, the IMO International Convention for the Prevention of Pollution from Ships of 1973, as from time to time amended and generally referred to as MARPOL, including the designation of emission control areas, or ECAs, thereunder, the IMO International Convention for the Safety of Life at Sea of 1974, as from time to time amended and generally referred to as SOLAS, the IMO International Convention on Load Lines of 1966, as from time to time amended and generally referred to as the LL Convention, the International Convention on Civil Liability for Bunker Oil Pollution Damage, generally referred to as the Bunker Convention, the IMO’s International Management Code for the Safe Operation of Ships and for Pollution Prevention, generally referred to as the ISM Code, the International Convention for the Control and Management of Ships’ Ballast Water and Sediments, generally referred to as the BWM Convention, and the International Ship and Port Facility Security Code, or ISPS.

We may also incur additional costs in order to comply with other existing and future regulatory obligations, including, but not limited to, costs relating to the 0.5% sulfur cap on marine fuels, air emissions including greenhouse gases, the management of ballast water, maintenance and inspection, development and implementation of emergency procedures and insurance coverage or other financial assurance of our ability to address pollution incidents. These costs could have a material adverse effect on our business, results of operations, cash flows and financial condition and our available cash. Because such conventions, laws and regulations are often revised, we cannot predict the ultimate cost of complying with such conventions, laws and regulations or the impact thereof on the resale price or useful life of vessels we may acquire in the future. Additional conventions, laws and regulations may be adopted which could limit our ability to do business or increase the cost of our doing business and which may materially adversely affect our operations.

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Regulations relating to ballast water discharge may adversely affect our revenues and profitability.

The IMO has imposed updated guidelines for ballast water management systems specifying the maximum amount of viable organisms allowed to be discharged from a vessel’s ballast water. Depending on the date of the IOPP renewal survey, existing vessels constructed before September 8, 2017 must comply with the updated D-2 standard. Compliance with the D-2 standard involves installing on-board systems to treat ballast water and eliminate unwanted organisms. Ships constructed on or after September 8, 2017 are to comply with the D-2 standards. Vessels are required to meet the discharge standard D-2 by installing an approved Ballast Water Management System (or BWMS). Pursuant to the BWM Convention amendments, BWMSs installed on or after October 28, 2020 shall be approved in accordance with BWMS Code, while BWMSs installed before October 28, 2020 must be approved taking into account guidelines developed by the IMO or the BWMS Code. Ships sailing in U.S. waters are required to employ a type-approved BWMS which is compliant with United States Coast Guard, or USCG, regulations. Amendments to the BWM Convention entered into force in June 2022 concerning commissioning testing of BWMS and the form of the International Ballast Water Management Certificate. Additional amendments to the BWM Convention, concerning the form of the Ballast Water Record Book, entered into force on February 1, 2025. All of our vessels are equipped with Ballast Water Treatment Systems ensuring compliance with the new environmental regulations. Nevertheless, we might incur compliance costs for any vessels we might acquire in the future, which might have a substantial effect on our profitability. Additionally, many countries already regulate the discharge of ballast water carried by vessels from country to country to prevent the introduction of invasive and harmful species via such discharges. The U.S., for example, requires vessels entering its waters from another country to conduct mid-ocean ballast exchange, or undertake some alternate measure, and to comply with certain reporting requirements.

Furthermore, United States regulations are currently changing. Although the 2013 Vessel General Permit, or VGP, program and U.S. National Invasive Species Act, or NISA, are currently in effect to regulate ballast discharge, exchange and installation, the Vessel Incidental Discharge Act, or VIDA, which was signed into law on December 4, 2018, requires that the U.S. Coast Guard develop implementation, compliance, and enforcement regulations regarding ballast water. It intends to replace the VGP scheme and streamline the patchwork of federal, state, and local requirements for the commercial vessel community. The US Environmental Protection Agency, or EPA, has indicated that new federal discharge standards for vessels may be published in autumn 2024. The VIDA gave the EPA two years to develop new national discharge standards for vessels and the U.S. Coast Guard another two years to develop regulations and best management practices to implement and enforce those standards. VIDA also specifies that the provisions of the VGP will continue to apply until EPA and the U.S. Coast Guard publish their final regulations, regardless of how long that takes, and that the permit cannot be modified during that time. On October 26, 2020, the EPA published a Notice of Proposed Rulemaking for Vessel Incidental Discharge National Standards of Performance under VIDA, and in November 2020, held virtual public meetings. On October 18, 2023, the EPA published a Supplemental Notice to the Vessel Incidental Discharge National Standards of Performance, which shares new ballast water information that the EPA received from the USCG. On September 20, 2024, the EPA finalized national standards of performance for non-recreational vessels 79-feet in length and longer with respect to incidental discharges and on October 9, 2024, the Vessel Incidental Discharge National Standards of Performance were published. Within two years of publication, the USCG is required to develop corresponding implementation regulations. If the USCG spends the full two years to finalize the corresponding enforcement standards, the current 2013 VGP scheme will remain in force until 2026. Several U.S. states have added specific requirements to the Vessel General Permit including submission of a Notice of Intent, or NOI, or retention of a Permit Authorization and Record of Inspection (PARI) form and submission of annual reports. This rule changes may have financial impact on our vessels and may result in vessels being banned from calling in the U.S. in case compliance issues arise.

Increased inspection procedures, tighter import and export controls and new security regulations could increase costs and disrupt our business.

International shipping is subject to security and customs inspection and related procedures in countries of origin, destination and trans-shipment points. Since the events of September 11, 2001, there have been a variety of initiatives intended to enhance vessel security, such as the MTSA, which are the U.S. Coast Guard’s issued regulations requiring the implementation of certain security requirements aboard vessels operating in waters subject to the jurisdiction of the United States and at certain ports and facilities. In addition, pursuant to the SOLAS Convention, dry bulk vessels and the ports in which we plan to operate are subject to the ISPS Code. These security procedures can result in seizure of vessel cargo, delays in the loading, discharging or trans-shipment and the levying of customs duties, fines or other penalties against exporters or importers and, in some cases, vessels. Future changes to the existing security procedures may be implemented that could affect the dry bulk sector. These changes have the potential to impose additional financial and legal obligations on vessels and, in certain cases, to render the shipment of certain types of goods uneconomical or impractical. These additional costs could reduce the volume of goods shipped, resulting in a decreased demand for vessels and have a negative impact on our business, revenues and customer relations.

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Acts of piracy on ocean-going vessels could adversely affect our business.

Acts of piracy have historically affected ocean-going vessels trading in regions of the world such as the Red Sea, the Gulf of Aden off the coast of Somalia, the Indian Ocean, and the Gulf of Guinea region off the coast of Nigeria, which has experienced increased incidents of piracy in recent years. Sea piracy incidents continue to occur, particularly in the South China Sea, the Indian Ocean, the Gulf of Guinea, and the Strait of Malacca, with dry bulk vessels particularly vulnerable to such attacks. Acts of piracy could result in harm or danger to the crews that man our vessels. Additionally, if piracy attacks result in regions in which our vessels are deployed being characterized as “war risk” zones by insurers or if our vessels are deployed in Joint War Committee “war and strikes” listed areas, premiums payable for insurance coverage could increase significantly and such insurance coverage may be more difficult to obtain, if available at all. In addition, crew and security equipment costs, including costs that may be incurred to employ onboard security armed guards, could increase in such circumstances. Furthermore, while we believe the charterer remains liable for charter payments when a vessel is seized by pirates, the charterer may dispute this and withhold charter hire until the vessel is released. A charterer may also claim that a vessel seized by pirates was not “on-hire” for a certain number of days and is therefore entitled to cancel the charterparty, a claim that we would dispute. We may not be adequately insured to cover losses from these incidents, which could have a material adverse effect on us. In addition, any detention hijacking as a result of an act of piracy against our vessels, or an increase in cost or unavailability of insurance for our vessels could have a material adverse impact on our business, financial condition, and results of operations.

The operation of dry bulk vessels has specific operational risks.

The operation of dry bulk vessels has certain unique risks. With a dry bulk vessel, the cargo itself and its interaction with the vessel can be an operational risk. By their nature, dry bulk cargoes are often heavy, dense, easily shifted, and react badly to water exposure. In addition, dry bulk vessels are often subjected to battering treatment during discharging operations with grabs, jackhammers (to pry encrusted cargoes out of the hold), and small bulldozers. This treatment may cause damage to the vessel. Vessels damaged due to treatment during discharging procedures may affect a vessel’s seaworthiness while at sea. Hull fractures in dry bulk vessels may lead to the flooding of the vessels’ holds. If a dry bulk vessel suffers flooding in its forward holds, the bulk cargo may become so dense and waterlogged that its pressure may buckle the vessel’s bulkheads, leading to the loss of a vessel.

If we are unable to adequately maintain our vessels, we may be unable to prevent these events. Any of these circumstances or events could negatively impact our business, financial condition, and results of operations. In addition, the loss of a vessel could harm our reputation as a safe and reliable vessel owner and operator.

If any of our vessels fails to maintain its class certification or fails any annual survey, intermediate survey, or special survey, or if any scheduled class survey takes longer or is more expensive than anticipated, this could have a material adverse impact on our financial condition and results of operations.

The hull and machinery of every commercial vessel must be certified by a classification society authorized by its country of registry. The classification society certifies that a vessel is safe and seaworthy in accordance with the applicable rules and regulations of the country of registry of the vessel and SOLAS.

A vessel must undergo annual, intermediate and special surveys. The vessel’s machinery may be on a continuous survey cycle, under which the machinery would be surveyed periodically over a five-year period. At the beginning, during, and at the end of this cycle, every vessel is required to undergo inspection of her underwater parts that usually includes dry-docking. These surveys and dry-dockings can be costly and can result in delays in returning a vessel to operation.

If any vessel does not maintain its class, the vessel will not be allowed to carry cargo between ports and cannot be employed or insured. Any such inability to carry cargo or be employed, or any related violation of the covenants under our loans or other financing agreements, could have a material adverse impact on our financial condition and results of operations.

As we employ seafarers covered by industry-wide collective bargaining agreements, a failure of industry groups to renew such agreements may disrupt our operations and adversely affect our earnings.

We employ a large number of seafarers. All the seafarers employed on our vessels are covered by industry-wide collective bargaining agreements that set minimum standards in wages and labor conditions. We cannot assure you that these agreements will be renewed as necessary or will prevent labor interruptions. Any labor interruptions could disrupt our operations and harm our financial performance.

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Maritime claimants could arrest or attach one or more of our vessels, which could interrupt our cash flows.

Crew members, suppliers of goods and services to a vessel, shippers of cargo and other parties may be entitled to a maritime lien against a vessel for unsatisfied debts, claims, or damages. In many jurisdictions, a maritime lien holder may enforce its lien by arresting a vessel through foreclosure proceedings. The arrest or attachment of one or more of our vessels could interrupt our cash flow and require us to pay large sums of funds to have the arrest lifted, which would have a material adverse effect on our financial condition and results of operations.

In addition, in some jurisdictions, such as South Africa, under the “sister ship” theory of liability, a claimant may arrest both the vessel that is subject to the claimant’s maritime lien and any “associated” vessel, which is any vessel owned or controlled by the same owner. Claimants could try to assert “sister ship” liability against one of our vessels for claims relating to another of our vessels.

Governments could requisition our vessels during a period of war or emergency, which could negatively impact our business, financial condition, results of operations, and available cash.

A government could requisition for title or hire one or more of our vessels. Requisition for title occurs when a government takes control of a vessel and becomes the owner. Also, a government could requisition a vessel for hire. Requisition for hire occurs when a government takes control of a vessel and effectively becomes the charterer at dictated charter rates. Generally, requisitions occur during a period of war or emergency. Although we would be entitled to compensation in the event of a requisition, the amount and timing of payment of such compensation is uncertain. Government requisition of one or more of our vessels could have a material adverse effect on our financial condition and results of operations.

Risks Relating to Our Company

The market values of our vessels may decrease, which could limit the amount of funds that we can borrow in the future or trigger breaches of certain financial covenants under our current or future loan agreements and other financing agreements, and we may incur an impairment or, if we sell vessels following a decline in their market value, a loss.

The fair market values of our vessels are related to prevailing freight charter rates. While the fair market value of vessels and the freight charter market have a very close relationship as the charter market moves from trough to peak, the time lag between the effect of charter rates on market values of ships can vary. A decrease in the market value of our vessels could require us to raise additional capital in order to remain compliant with our loan covenants or the covenants in the other financing agreements and could result in the loss of our vessels (including through foreclosure by our lenders and lessors) and adversely affect our earnings and financial condition.

The market value of dry bulk vessels, and Capesize dry bulk carriers in particular, has historically exhibited great volatility. From 2010 until today, the standard 182,000 dwt Capesize yard resale prices have fluctuated from $35.0 million in March 2016 to $77.0 million in May 2024. Very similar trends have also been witnessed in the Kamsarmax and Panamax sectors.

The fair market value of our vessels is dependent on other factors as well, including:


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prevailing levels of charter rates;


•
general economic and market conditions affecting the shipping industry, including changes in global dry cargo commodity supply;


•
competition from other shipping companies;


•
types, sizes, and age of vessels;


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sophistication and condition of the vessels;


•
advances in vessel efficiency, such as the introduction of autonomous vessels;


•
where the vessel was built, as-built specifications, and subsequent modifications and improvements;

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lifetime maintenance record;


•
supply and demand for vessels;


•
number of newbuilding deliveries;


•
number of vessels scrapped or otherwise removed from the world fleet;


•
the scrap value of vessels;


•
cost of secondhand tonnage;


•
cost of newbuilding vessels;


•
cost of secondhand vessel acquisitions;


•
changes in environmental and other regulations that may limit the useful life of vessels;


•
decreased costs and increases in use of other modes of transportation;


•
whether the vessel is equipped with scrubbers or not;


•
global economic or pandemic-related crises;


•
governmental and other regulations, including environmental regulations;


•
ability of buyers to access financing and capital;


•
technological advances; and


•
the cost of retrofitting or modifying existing ships to respond to technological advances in vessel design or equipment, changes in applicable environmental or other regulations or standards, or otherwise.

In addition, as vessels age, they generally decline in value. If the fair market value of our vessels declines, we may not be in compliance with certain covenants in our current or future loan agreements and other financing agreements we may enter into, and our lenders or lessors could accelerate our indebtedness or require us to pay down our indebtedness to a level where we are again in compliance with such covenants, or foreclose their liens. If any of our future loan agreements and other financing agreements are accelerated, we may not be able to refinance our debt or obtain additional funding.

 In addition, if vessel values decline, we may have to record an impairment adjustment in our financial statements, which could adversely affect our financial results. Furthermore, if we sell one or more of our vessels at a time when vessel prices have fallen, the sale price may be less than the vessel’s carrying value on our carve-out financial statements, resulting in a loss on sale or an impairment loss being recognized, leading to a reduction in earnings.

If we fail to manage our planned growth properly, we may not be able to successfully expand our fleet.

As part of our growth strategy, we may acquire additional vessels in the future. Further, we may expand our fleet into other seaborne transportation sectors depending on available opportunities. Our ability to manage our planned growth will primarily depend on our ability to:


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generate excess cash flow so that we can invest without jeopardizing our ability to cover current and foreseeable working capital needs, including debt service;


•
finance our operations;


•
identify opportunities to enter other seaborne transportation sectors;


•
locate and acquire suitable vessels;


•
identify and consummate acquisitions or joint ventures;


•
integrate any acquired businesses or vessels, including those operating in sectors in which we do not currently operate, successfully with our existing operations;


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hire, train, and retain qualified personnel and crew to manage and operate our growing business and fleet; and


•
expand our customer base, including in new sectors.

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Growing any business by acquisitions presents numerous risks and challenges, such as obtaining acquisition financing on acceptable terms or at all, handling undisclosed liabilities and obligations, obtaining and/or maintaining additional qualified personnel, managing relationships with customers and suppliers, and integrating newly acquired operations into existing infrastructures. We may not be successful in executing our growth plans and we may incur significant additional expenses and losses in connection therewith.

Newbuilding projects are subject to risks that could cause delays.

We may enter into newbuilding contracts in connection with our vessel acquisition strategy. Newbuilding construction projects are subject to risks of delay inherent in any large construction project from numerous factors, including shortages of equipment, materials, or skilled labor, unscheduled delays in the delivery of ordered materials and equipment or shipyard construction, failure of equipment to meet quality and/or performance standards, financial or operating difficulties experienced by equipment vendors or the shipyard, unanticipated actual or purported change orders, inability to obtain required permits or approvals, design or engineering changes, work stoppages and other labor disputes, adverse weather conditions, or any other events of force majeure. A shipyard’s failure to deliver a vessel on time may result in the delay of revenue from the vessel. Any such failure or delay could have a material adverse effect on our results of operations.

We may be unable to obtain financing for vessels we may acquire.

We can offer no assurance that we will be able to obtain the necessary financing for the acquisition of any vessels we may acquire in the future, on attractive terms or at all. If financing is not available when needed, or is available only on unfavorable terms, we may be unable to meet our purchase price payment obligations and complete the acquisition of such vessels and expand the size of our fleet. If we fail to fulfill our commitments thereunder, due to an inability to obtain financing or otherwise, we may also be liable for damages for breach of contract. Our failure to obtain the funds for these capital expenditures could have a material adverse effect on our business, results of operations, and financial condition, as well as our cash flows.

Vessels we may acquire in the future are not delivered on time or are delivered with significant defects, our earnings and financial condition could suffer.

We may acquire additional vessels in the future. A delay in the delivery of any vessels to us, the failure of the contract counterparty to deliver a vessel at all, or us not taking delivery of a vessel could cause us to breach our obligations under the acquisition contract or under a related time charter and become liable for damages for breach of contract or could otherwise adversely affect our financial condition and results of operations. In cases where the fault lies with the contract counterparty, we would be entitled to compensation, but the amount and timing of payment of such compensation is uncertain. In addition, the delivery of any vessel with substantial defects could have similar consequences and, although we intend to inspect the condition of the vessels pre-acquisition, there is no assurance that we will be able to identify such defects. We have not received in the past, and do not expect to receive in the future, the benefit of warranties on any secondhand vessels we acquire. Any of these circumstances or events could have a material adverse effect on our business, results of operations, cash flows, and financial condition.

Substantial debt levels could limit our flexibility to obtain additional financing and pursue other business opportunities.

As of December 31, 2024, we had approximately $100.5 million in debt outstanding across our loan facilities, sale and leaseback transactions and financial leases. We may also incur further indebtedness in connection with the acquisition of additional vessels, although there can be no assurance that we will be successful in identifying further vessels or securing such debt financing. Significant levels of debt could have important consequences for us, including the following:


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our ability to obtain additional financing, if necessary, for working capital, capital expenditures, acquisitions, or other purposes may be impaired, or such financing may be unavailable on favorable terms, or at all;


•
we may need to use a substantial portion of our cash from operations to make principal and interest payments on our bank debt and financing liabilities, reducing the funds that would otherwise be available for operations, future business opportunities, and any future dividends to our shareholders;


•
our debt level could make us more vulnerable to competitive pressures or a downturn in our business or the economy generally than our competitors with less debt; and


•
our debt level may limit our flexibility in responding to changing business and economic conditions.

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Our ability to service our indebtedness will depend upon, among other things, our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory, and other factors, some of which are beyond our control, as well as the interest rates applicable to our outstanding indebtedness. If the value of our vessels does not sufficiently serve as security for our lenders, or if our operating income is not sufficient to service our indebtedness, we will be forced to take actions, such as reducing or delaying our business activities, acquisitions, investments, or capital expenditures, selling assets, restructuring or refinancing our debt, or seeking additional equity capital. We may not be able to effect any of these remedies on satisfactory terms, or at all. In addition, a lack of liquidity in the debt and equity markets could hinder our ability to refinance our debt or obtain additional financing on favorable terms in the future.

Our financing arrangements contain, and we expect that other future financing arrangements will contain, restrictive covenants that may limit our liquidity and corporate activities, which could limit our operational flexibility and have an adverse effect on our financial condition and results of operations. In addition, because of the presence of cross-default provisions in our loan agreements, a default by us under one loan agreement could lead to defaults under other loan agreements and financing agreements.

Our financing agreements contain, and we expect that other future financing arrangements will contain, customary covenants and event of default clauses, financial covenants, restrictive covenants, and performance requirements, which may affect operational and financial flexibility. Such restrictions could affect and, in many respects, limit or prohibit, among other things, our ability to pay dividends, incur additional indebtedness, create liens, sell assets, or engage in mergers or acquisitions. These restrictions could limit our ability to plan for or react to market conditions or meet extraordinary capital needs or otherwise restrict corporate activities. There can be no assurance that such restrictions will not adversely affect our ability to finance our future operations or capital needs.

As a result of these restrictions, we may need to seek permission from our lenders and other financing counterparties in order to engage in some corporate actions. Our lenders’ and other financing counterparties’ interests may be different from ours and we may not be able to obtain their permission when needed. This may prevent us from taking actions that we believe are in our best interests, which may adversely impact our revenues, results of operations, and financial condition.

A failure by us to meet our payment and other obligations, including our financial covenants and any security coverage requirements, could lead to defaults under our financing arrangements. Likewise, a decrease in vessel values or adverse market conditions could cause us to breach our financial covenants or security requirements (the market values of dry bulk vessels have generally experienced high volatility). In the event of a default that we cannot remedy, our lenders and other financing counterparties could then accelerate their indebtedness and foreclose on the respective vessels comprising our fleet. The loss of our vessels could have a material adverse effect on our business, results of operations, and financial condition.

Our financing arrangements contain, and any financing arrangements we may enter into in the future are expected to contain, cross-default provisions, pursuant to which a default by us under a loan and the refusal of any one lender or financing counterparty to grant or extend a waiver could result in the acceleration of our indebtedness under any other loans and financing agreements we have entered into.

There can be no assurance that we will obtain waivers, deferrals, and amendments of certain financial covenants, payment obligations and events of default under our loan facilities with our lenders in the future, if needed.

Volatility of SOFR and potential changes of the use of SOFR as a benchmark could affect our profitability, earnings, and cash flow.

An increase in the Secured Overnight Financing Rate (“SOFR”) would affect the amount of interest payable under our existing loan agreements, which, in turn, could have an adverse effect on our profitability, earnings, cash flow, and ability to pay dividends. If SOFR performs differently than expected or if our lenders insist on a different reference rate to replace SOFR, that could increase our borrowing costs (and administrative costs to reflect the transaction), which would have an adverse effect on our profitability, earnings, and cash flows. Alternative reference rates may behave in a similar manner or have other disadvantages or advantages in relation to our future indebtedness and the transition to SOFR or other alternative reference rates in the future could have a material adverse effect on us.

In order to manage any future exposure to interest rate fluctuations, we may from time-to-time use interest rate derivatives to effectively fix any floating rate debt obligations. No assurance can, however, be given that the use of these derivative instruments, if any, may effectively protect us from adverse interest rate movements. The use of interest rate derivatives may affect our results through mark to market valuation of these derivatives. Also, adverse movements in interest rate derivatives may require us to post cash as collateral, which may impact our free cash position, and have the potential to cause us to breach covenants in our loan agreements that require maintenance of certain financial positions and ratios. Interest rate derivatives may also be impacted by the transition to SOFR or to other alternative rates.

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We depend on officers and directors who are associated with Seanergy, which may create conflicts of interest.

Our officers and directors have fiduciary duties to manage our business in a manner beneficial to us and our shareholders. However, Stamatios Tsantanis, who serves as our Chairman and Chief Executive Officer, is also the Chairman and Chief Executive Officer of Seanergy. In addition, Stavros Gyftakis, who serves as our Chief Financial Officer and as a director, is the Chief Financial Officer of Seanergy, and Christina Anagnostara and Ioannis Kartsonas, who serve as independent directors, also serve as directors of Seanergy. These officers and directors have fiduciary duties and responsibilities to manage the business of Seanergy in a manner beneficial to it and its shareholders and may have conflicts of interest in matters involving or affecting us and our customers or shareholders, or when faced with decisions that could have different implications for Seanergy than they do for us. The resolution of these potential conflicts may not always be in our best interest or that of our shareholders and could have a material adverse effect on our business, results of operations, cash flows and financial condition.

Vessel aging and purchasing and operating secondhand vessels, which currently compose our entire fleet, may result in increased operating costs and vessel off-hire, which could adversely affect our financial condition and results of operations.

The current vessels in our fleet are all secondhand vessels. Our inspection of these vessels or other secondhand vessels prior to purchase does not provide us with the same knowledge about their condition and the cost of any required or anticipated repairs that we would have had if these vessels had been built for and operated exclusively by us. We have not received in the past, and do not expect to receive in the future, the benefit of warranties on any secondhand vessels we acquire.

As our current vessels or other secondhand vessels we may acquire age, they may become less fuel efficient and costlier to maintain and will not be as advanced as recently constructed vessels due to improvements in design, technology, and engineering, including improvements required to comply with government regulations. Rates for cargo insurance, paid by charterers, also increase with the age of a vessel, making older vessels less desirable to charterers, which could result in lower utilization and, therefore, lower revenues.

In addition, charterers actively discriminate against hiring older vessels. Rightship, the dry bulk ship vetting service founded by Rio Tinto and BHP-Billiton, has become a major vetting service in the dry bulk shipping industry, which ranks the suitability of vessels based on a scale of one to five stars. There are carriers that may not charter a vessel that Rightship has vetted with fewer than three stars. Therefore, a potentially deteriorated star rating for our vessels may affect their commercial operation and profitability and vessels in our fleet with lower ratings may experience challenges in securing charters. Effective as of January 1, 2018, Rightship’s age trigger for a dry cargo inspection for vessels over 8,000 dwt changed from 18 years to 14 years, after which an annual acceptable Rightship inspection will be required. Rightship may downgrade any vessel over 18 years of age that has not completed a satisfactory inspection by Rightship, in the same manner as any other vessel over 14 years of age, to two stars, which significantly decreases its chances of entering into a charter. One and seven dry bulk vessels in our fleet have four and three-star risk ratings from Rightship, respectively.

Governmental regulations and safety or other equipment standards related to the age or condition of vessels may require expenditures for alterations, or the addition of new equipment, to our vessels and may restrict the type of activities in which the vessels may engage. As our vessels age, market conditions may not justify those expenditures or enable us to operate our vessels profitably during the remainder of their useful lives.

In addition, unless we maintain cash reserves for vessel replacement, we may be unable to replace the current vessels in our fleet upon the expiration of their useful lives. We estimate the useful life of our vessels to be 25 years from the date of initial delivery from the shipyard. Our cash flows and income are dependent on the revenues we earn by chartering our vessels to customers. If we are unable to replace the vessels in our fleet upon the expiration of their useful lives, our business, financial condition, and results of operations will be materially adversely affected. Any reserves set aside for vessel replacement would not be available for other cash needs or dividends.

We also face competition from companies with more modern vessels with more fuel-efficient designs than our current vessels. Competition from more technologically advanced vessels could adversely affect the chartering opportunities available to us and the charter rates we will be able to negotiate, therefore adversely affecting our business, results of operations, cash flows, and financial condition, while also significantly decreasing the resale value of our vessels.

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Worldwide inflationary pressures could negatively impact our results of operations and cash flows.

Inflation could have an adverse impact on our business and operating results and subsequently on our financial condition both directly through the increase of operating costs, including crew costs and materials necessary for the operation of our vessels and indirectly through its adverse impact on the world economy in terms of increasing interest rates and slowdown of global growth. Worldwide economies have in the recent past experienced inflationary pressures, with price increases seen across many sectors globally. In response to the inflationary pressures in recent years, central banks made steep increases in interest rates, which resulted in increases to the interest rates available to us for the financing of our operations and investment activity. Although central banks have started decreasing interest rates, future monetary policies cannot be guaranteed. If central banks need to increase interest rates again, or if interest rates otherwise increase significantly, the resulting increase to the interest rates available to us on both existing loans on floating rate and new debt financings or refinancings we may pursue could adversely affect our cash flows and our ability to complete vessel acquisitions, take advantage of business opportunities, or respond to competitive pressures. Furthermore, if inflationary pressures intensify, we may be unable to raise our charter rates enough to offset the increasing costs of our operations, which would decrease our profit margins and result in deterioration of our financial condition. There is uncertainty regarding inflation due to the likely shift in policy following numerous elections around the world. Trade tariffs announced by President Trump and retaliatory tariffs and countermeasures from affected countries could trigger economic uncertainty but the impact on inflation is unclear.

Whether the present inflationary pressures will transition to a long-term inflationary environment and the effect of such a development on charter rates, vessel demand, and operating expenses in the sector in which we operate are uncertain.

The failure of our current or future counterparties to meet their obligations under our contracts, including charter agreements, could cause us to suffer losses or otherwise adversely affect our business.

We have entered, and plan to enter, into various contracts, including charterparties with our customers, vessel management agreements and other agreements, which subject us to counterparty risks. The ability and willingness of each of our current or future counterparties to perform its obligations under these contracts with us will depend on a number of factors that are beyond our control and may include, among other things, general economic conditions, the condition of the dry bulk shipping industry and the industries in which our counterparties operate, the overall financial condition of the counterparties, and the supply and demand for dry bulk commodities.

From time to time, those counterparties may account for a significant amount of our chartering activity and revenues. In addition, in challenging market conditions, there have been reports of charterers renegotiating their charters or defaulting on their obligations under charter agreements, and so our customers may fail to pay charter hire or attempt to renegotiate charter rates. Should a counterparty fail to honor its obligations under agreements with us, it may be difficult to secure substitute employment for such vessel on favorable terms or at all, and any new charter arrangements we secure in the spot market or on time charters could be at lower rates. If our charterers fail to meet their obligations to us or attempt to renegotiate our charter agreements, we could suffer significant losses, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

Rising crew costs may adversely affect our profits.

Crew costs are anticipated to be a major expense for us. The growing global shipping fleet has led to higher demand for highly skilled and qualified crew, driving crewing costs upward. If we are unable to raise our rates accordingly, these rising costs could negatively impact our profitability.

We may not be able to attract and retain key management personnel and other employees in the shipping industry, which may negatively affect the effectiveness of our management and our results of operations.

Our success will depend to a significant extent upon the abilities and efforts of our management team, including our ability to retain key members of our management team and the ability of our management to recruit and hire suitable employees. The loss of any of these individuals could adversely affect our business prospects and financial condition. Difficulty in hiring and retaining personnel could adversely affect our business and results of operations.

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Our vessels may suffer damage, and we may face unexpected repair costs, which could adversely affect our cash flow and financial condition.

The operation of an ocean-going vessel carries inherent risks, which include the risk of the vessel or its cargo being damaged or lost because of events such as marine disasters, bad weather and other acts of God, business interruptions caused by mechanical failures, grounding, fire, explosions and collisions, human error, war, terrorism, piracy, labor strikes, boycotts, and other similar circumstances or events.

If our vessels suffer damage, they may need to be repaired at a shipyard facility. The time and costs of repairs are unpredictable and may be substantial. The loss of earnings while our vessels are being repaired and repositioned, as well as the actual cost of these repairs and any repositioning costs, would decrease our earnings and reduce the amount of any dividends in the future. We may also be unable to find space at a suitable drydocking facility and be forced to travel to a drydocking facility that is not conveniently located to the position of our vessels. For more information, see “—Risks associated with operating ocean-going vessels could affect our business and reputation, which could adversely affect our revenues and expenses.” We may not have insurance that is sufficient to cover all or any of these costs or losses and may have to pay repair costs not covered by our insurance.

We are exposed to U.S. dollar and foreign currency fluctuations and devaluations that could harm our reported revenue and results of operations.

We generate all of our revenues and incur the majority of our operating expenses in U.S. dollars, but we currently incur many of our general and administration expenses in currencies other than the U.S. dollar, primarily the euro. Because such portion of our expenses is incurred in currencies other than the U.S. dollar, our expenses may from time to time increase relative to our revenues as a result of fluctuations in exchange rates, particularly between the U.S. dollar and the euro, which could affect the amount of net income that we report in future periods. We may use financial derivatives to operationally hedge some of our currency exposure. Our use of financial derivatives involves certain risks, including the risk that losses on a hedged position could exceed the nominal amount invested in the instrument and the risk that the counterparty to the derivative transaction may be unable or unwilling to satisfy its contractual obligations, which could have an adverse effect on our results.

We maintain cash with a limited number of financial institutions  which will subject us to credit risk.

We maintain all of our cash with a limited number of financial institutions mostly located in Europe.

Generally, only a portion of cash balances are covered by insurance in the event of default by a financial institution. Several banks, including banks in the United States and Switzerland, have recently been subject to extraordinary resolution procedures or sale because of the risk of such a default. In the event of such a default of a financial institution, we may lose part or all of our cash that we hold deposited with such financial institution.

We are a holding company and we depend on the ability of our subsidiaries to distribute funds to us in order to satisfy financial obligations or to pay dividends.

We are a holding company and our subsidiaries, which are all wholly owned by us either directly or indirectly, conduct all of our operations and own all of our operating assets. We have no significant assets other than the equity interests in our wholly owned subsidiaries. As a result, our ability to make dividend payments depends on our subsidiaries and their ability to distribute funds to us. The ability of a subsidiary to make these distributions could be affected by the covenants in our loan agreements, a claim or other action by a third party, including a creditor, and the laws of the Republic of the Marshall Islands and the Republic of Liberia, where our vessel-owning or other subsidiaries are incorporated, which regulate the payment of dividends by companies. If we are unable to obtain funds from our subsidiaries, we may not be able to satisfy our financial obligations.

In addition to its earnings, financial condition, cash requirements and availability, the ability of a subsidiary to make distributions to us could be affected by the covenants in our future loan agreements or other financing arrangements, a claim or other action by a third party, including a creditor, and the laws of its country of incorporation. If we are unable to obtain funds from our subsidiaries, we may not be able to satisfy our financial obligations and, consequently, our board of directors may exercise its discretion not to declare or pay any dividend.

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In the highly competitive international shipping industry, we may not be able to compete for charters with new entrants or established companies with greater resources, which may adversely affect our results of operations.

We operate in a highly competitive market that is capital intensive and highly fragmented. Competition arises primarily from other vessel owners, some of whom may have substantially greater resources than we do. Competition for the transportation of dry bulk cargoes by sea is intense and depends on price, location, size, age, condition, and the acceptability of the vessel and its operators to the charterers. Due in part to the highly fragmented market, competitors with greater resources could enter the dry bulk shipping industry and operate larger fleets through consolidations or acquisitions and may be able to offer lower charter rates and higher quality vessels than we are able to offer. Although we believe that no single competitor has a dominant position in the markets in which we compete, we are aware that certain competitors may be able to devote greater financial and other resources to their activities than we can, resulting in a significant competitive threat to us. We cannot give assurances that we will continue to compete successfully with our competitors or that these factors will not erode our competitive position in the future.

We may be subject to litigation that, if not resolved in our favor and not sufficiently insured against, could have a material adverse effect on us.

We may be, from time to time, involved in various litigation matters. These matters may include, among other things, contract disputes, personal injury claims, environmental claims or proceedings, asbestos and other toxic tort claims, employment matters, governmental claims for taxes or duties, and other litigation that arises in the ordinary course of our business. Although we intend to defend these matters vigorously, we cannot predict with certainty the outcome or effect of any claim or other litigation matter, and the ultimate outcome of any litigation or the potential costs to resolve them may have a material adverse effect on us. Insurance may not be applicable or sufficient in all cases or insurers may not remain solvent, which may have a material adverse effect on our financial condition.

The shipping industry has inherent operational risks that may not be adequately covered by our insurances. Further, because we obtain some of our insurances through protection and indemnity associations, we may also be retrospectively subject to calls or premiums in amounts based not only on our own claim records, but also on the claim records of all other members of the protection and indemnity associations.

We procure insurance for our fleet against risks commonly insured against by vessel owners and operators. Our current insurances include hull and machinery insurance, war risks insurance, demurrage and defense insurance, and protection and indemnity insurance (which includes environmental damage and pollution insurance). We do not expect to maintain for our vessels insurance against loss of hire, which covers business interruptions that result from the loss of use of a vessel, except in cases when our vessels transit through or call at high risk areas. We may not be adequately insured against all risks or our insurers may not pay a particular claim. Even if our insurance coverage is adequate to cover our losses, we may not be able to timely obtain a replacement vessel in the event of a loss. Furthermore, in the future, we may not be able to obtain adequate insurance coverage at reasonable rates for our fleet. Our insurance policies also contain deductibles, caps, limitations, and exclusions which, although we believe are standard in the shipping industry, may nevertheless increase our costs. If our insurances are not enough to cover claims that may arise, the deficiency may have a material adverse effect on our financial condition and results of operations. We may also be retrospectively subject to calls, or premiums, in amounts based not only on our own claim records but also the claim records of all other members of the protection and indemnity associations through which we receive indemnity insurance coverage for tort liability, including pollution-related liability. Our payment of these calls could result in significant expenses to us.

Failure to comply with the U.S. Foreign Corrupt Practices Act of 1977, or FCPA, could result in fines, criminal penalties, and an adverse effect on our business.

We operate throughout the world, including countries with a reputation for corruption. We are committed to doing business in accordance with applicable anti-corruption laws and have adopted a code of business conduct and ethics which is consistent and in full compliance with the FCPA. We are subject, however, to the risk that we, our affiliated entities or our or their respective officers, directors, employees and agents may take action determined to be in violation of such anti-corruption laws, including the FCPA. Any such violation could result in substantial fines, sanctions, civil and/or criminal penalties, curtailment of operations in certain jurisdictions, and might adversely affect our business, results of operations or financial condition. In addition, actual or alleged violations could damage our reputation and ability to do business. Furthermore, detecting, investigating, and resolving actual or alleged violations is expensive and can consume significant time and attention of our senior management.

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We depend on Seanergy and its wholly owned management subsidiaries to partly operate our business and our business could be harmed if they fail to perform such services satisfactorily.

We have entered into a master management agreement with Seanergy for the provision of technical, administrative, commercial, brokerage, and certain other services. Certain of these services are being contracted directly with Seanergy Management Corp. (“Seanergy Management”) or Seanergy Shipmanagement Corp. (“Seanergy Shipmanagement” and together with Seanergy Management, the “Managers”). Our operational success partly depends upon the Managers’ and Seanergy’s satisfactory performance of these services. Our business would be harmed if the Managers or Seanergy failed to perform these services satisfactorily. In addition, if our management agreements with the Managers or Seanergy were to be terminated or if their terms were to be altered, our business could be adversely affected, as we may not be able to immediately replace such services, and even if replacement services were immediately available, the terms offered could be less favorable than those under our existing management agreements.

We depend on third-party managers to manage part of our fleet.

We have entered into technical and commercial management agreements with the Managers and third-party managers for the management of part of our fleet. The Managers may subcontract or arrange certain aspects of the technical, such as crewing, or the commercial management for our current vessels and any other vessels we may acquire to third parties, including, but not limited to, V.Ships Greece Ltd. (“V.Ships”), Fidelity Marine Inc. (“Fidelity”), and Global Seaways S.A. (“Global Seaways”). The loss of the services of such third parties or their failure to perform their obligations could materially and adversely affect the results of our operations. Although we may have rights against these managers if they default on their obligations, we may have no recourse against these parties. In addition, we might not be able to find replacement third-party managers on terms as favorable as those currently in place.

Management fees are payable to the Managers or our third-party managers regardless of our profitability, which could have a material adverse effect on our business, financial condition, and results of operations.

Pursuant to the management agreements, we are paying to Seanergy Shipmanagement a fixed technical management fee of $14,000 per month for the M/Vs Gloriuship, Synthesea, Nisea, Chrisea, Cretansea and Goodship, and to Seanergy a fixed administration fee of $325 per vessel per day. We pay our third-party technical managers a fixed management fee of $10,000 per month for the M/V Tradership and M/V Exelixsea. We are also paying to Seanergy Management a fee equal to 0.75% of the gross freight, demurrage, and charter hire collected from the employment of our vessels and a fee equal to 1% of the contract price of vessels bought, sold or bareboat chartered on our behalf (not including any vessels bought, sold or bareboat chartered from or to Seanergy). These management fees do not cover expenses such as voyage expenses, vessel operating expenses, maintenance expenses, and crewing costs, for which we will reimburse the technical managers. In addition, we have entered into a commercial management agreement with Fidelity, an independent third party, pursuant to which Fidelity provides commercial management services for the vessels in our fleet. For such services, we are paying to Fidelity (i) a monthly fee of $5,000 and (ii) commission fees equal to 0.5% of the collected gross hire, freight and demurrage which may be increased to 1.25% in cases when there is no other ship brokerage firm involved in the negotiations, charterparty drafting and final agreement regarding the employment of our vessels. Under such agreement, we reimburse Fidelity for all reasonable running and out-of-pocket expenses. These management fees, excluding the commission fees on the gross freight, demurrage and charter hire, are to some extent payable whether or not our vessels are employed and in any case regardless of our profitability, and we have no ability to require the Managers or our third-party managers to reduce these management fees if our profitability decreases, which could have a material adverse effect on our business, financial condition, and results of operations.

We may be classified as a passive foreign investment company, which could result in adverse U.S. federal income tax consequences to U.S. holders of our common shares.

A foreign corporation will be treated as a “passive foreign investment company,” or PFIC, for U.S. federal income tax purposes if either (1) at least 75% of its gross income for any taxable year consists of certain types of “passive income” or (2) at least 50% of the average value of the corporation’s assets produce or are held for the production of those types of “passive income.” For purposes of these tests, “passive income” includes dividends, interest, gains from the sale or exchange of investment property and rents and royalties other than rents and royalties which are received from unrelated parties in connection with the active conduct of a trade or business. For purposes of these tests, income derived from the performance of services does not constitute “passive income.” U.S. shareholders of a PFIC are subject to a disadvantageous U.S. federal income tax regime with respect to the income derived by the PFIC, the distributions they receive from the PFIC and the gain, if any, they derive from the sale or other disposition of their shares in the PFIC.

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Based upon our current and anticipated method of operations, we do not believe that we should be a PFIC with respect to our 2024 taxable year, and we do not expect to become a PFIC in 2025 or any future taxable year. In this regard, we intend to treat our gross income from time charters as active services income, rather than rental income. Accordingly, our income from our time chartering activities should not constitute “passive income,” and the assets that we own and operate in connection with the production of that income should not constitute passive assets. There is substantial legal authority supporting this position, including case law and U.S. Internal Revenue Service, or IRS, pronouncements concerning the characterization of income derived from time charters and voyage charters as services income for other tax purposes. However, it should be noted that there is also authority which characterizes time charter income as rental income rather than services income for other tax purposes. Accordingly, no assurance can be given that the IRS or a court of law will accept this position, and there is a risk that the IRS or a court of law could determine that we are a PFIC. Moreover, no assurance can be given that we would not constitute a PFIC for any future taxable year if the nature and extent of our operations change.

If the IRS were to find that we are or have been a PFIC for any taxable year, our U.S. shareholders would face adverse U.S. federal income tax consequences and certain information reporting requirements. Under the PFIC rules, unless those shareholders make an election available under the United States Internal Revenue Code of 1986 as amended, or the Code (which election could itself have adverse consequences for such shareholders), such shareholders would be liable to pay U.S. federal income tax at the then prevailing income tax rates on ordinary income plus interest upon excess distributions and upon any gain from the disposition of our common shares, as if the excess distribution or gain had been recognized ratably over the shareholder’s holding period of our common shares. See “Item 10.E. Taxation – United States Federal Income Tax Consequences – United States Federal Income Taxation of U.S. Holders – Passive Foreign Investment Company Rules” for a more comprehensive discussion of the U.S. federal income tax consequences to U.S. shareholders if we are treated as a PFIC.

We may have to pay tax on U.S. source income, which would reduce our earnings.

Under the Code, 50% of the gross shipping income of a vessel-owning or chartering corporation, such as us and our subsidiaries, that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States, exclusive of certain U.S. territories and possessions, or “U.S. source gross shipping income” may be subject to a 4% U.S. federal income tax without allowance for deduction, unless that corporation qualifies for exemption from tax under Section 883 of the Code and the applicable Treasury Regulations promulgated thereunder.

We believe that we qualify for exemption from the 4% tax under Section 883 of the Code for our 2024 taxable year and intend to take this position on our tax return. However, there are factual circumstances beyond our control that could cause us not to have the benefit of the tax exemption under Section 883 in 2025 or future years and thereby cause us to become subject to U.S. federal income tax on our U.S. source shipping income. For example, there is a risk that we could fail to qualify for exemption under Section 883 of the Code for a particular taxable year if “non-qualified” shareholders with a five percent or greater interest in our common shares were, in combination with each other, to own 50% or more of outstanding common shares on more than half the days during the taxable year. See the description of the ownership tests which must be satisfied to qualify for exemption under Section 883 of the Code in “Item 10.E. Taxation – United States Federal Income Tax Consequences – Exemption of Operating Income from United States Federal Income Taxation.”

Because the availability of the exemption depends on factual circumstances beyond our control, we can give no assurances on the tax-exempt status of ourselves or that of any of our subsidiaries for our 2025 or subsequent taxable years. If we or our subsidiaries are not entitled to exemption under Section 883, we or our subsidiaries will be subject to the 4% U.S. federal income tax on 50% of any shipping income such companies derive that is attributable to the transport of cargoes to or from the United States. This tax is a cost, which, if unreimbursed, has a negative effect on our business and results in decreased earnings available for distribution to our shareholders.

We are a “foreign private issuer,” which could make our common shares less attractive to some investors or otherwise harm our share price.

We are a “foreign private issuer,” as such term is defined in Rule 405 under the Securities Act. As a “foreign private issuer” the rules governing the information that we disclose differ from those governing U.S. corporations pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We are not required to file quarterly reports on Form 10-Q or provide current reports on Form 8-K disclosing significant events within four days of their occurrence. In addition, our officers and directors are exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and related rules with respect to their purchase and sales of our securities. Our exemption from the rules of Section 16 of the Exchange Act regarding sales of common shares by insiders means that you will have less data in this regard than shareholders of U.S. companies that are subject to the Exchange Act. Moreover, we are exempt from the proxy rules, and proxy statements that we distribute will not be subject to review by the Commission. Accordingly, there may be less publicly available information concerning us than there is for other U.S. public companies that are not foreign private issuers. These exemptions and scaled disclosure requirements are not related to our status as an emerging growth company, and will continue to be available to us even if we no longer qualify as an emerging growth company, but remain a foreign private issuer. These factors could make our common shares less attractive to some investors or otherwise harm our share price.

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Our corporate governance practices are in compliance with, and are not prohibited by, the laws of the Republic of the Marshall Islands, and as such we are entitled to exemption from certain Nasdaq corporate governance standards. As a result, you may not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements.

Our corporate governance practices are in compliance with, and are not prohibited by, the laws of the Republic of the Marshall Islands. Therefore, we are exempt from many of Nasdaq’s corporate governance practices other than the requirements regarding the disclosure of a going concern audit opinion, submission of a listing agreement, notification of material non-compliance with Nasdaq corporate governance practices, and the establishment and composition of an audit committee and a formal written audit committee charter. For a list of the practices followed by us in lieu of Nasdaq’s corporate governance rules, we refer you to “Item 16G. Corporate Governance” in this annual report. To the extent we rely on these or other exemptions, you may not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements.

The Public Company Accounting Oversight Board inspection of our independent accounting firm could lead to adverse findings in our auditors’ reports and challenges to the accuracy of our published audited financial statements.

Auditors of U.S. public companies are required by law to undergo periodic Public Company Accounting Oversight Board, or PCAOB, inspections that assess their compliance with U.S. law and professional standards in connection with performance of audits of financial statements filed with the SEC. For several years, certain European Union countries, including Greece, did not permit the PCAOB to conduct inspections of accounting firms established and operating in such European Union countries, even if they were part of major international firms. Accordingly, unlike for most U.S. public companies, the PCAOB was prevented from evaluating our auditor’s performance of audits and its quality control procedures, and, unlike shareholders of most U.S. public companies, we and our shareholders were deprived of the possible benefits of such inspections. Since 2015, Greece agreed to allow the PCAOB to conduct inspections of accounting firms operating in Greece. In the future, such PCAOB inspections could result in findings in our auditors’ quality control procedures, question the validity of the auditor’s reports on our published financial statements and the effectiveness of our internal control over financial reporting, and cast doubt upon the accuracy of our published audited financial statements.

We conduct business in China, where the legal system is not fully developed and has inherent uncertainties that could limit the legal protections available to us.

Our vessels and other vessels we may acquire may be chartered to Chinese customers and, from time to time on our charterers’ instructions, our vessels may call on Chinese ports. Such charters and voyages may be subject to regulations in China that may require us to incur new or additional compliance or other administrative costs and may require that we pay to the Chinese government new taxes or other fees. Applicable laws and regulations in China may not be well publicized and may not be known to us or our charterers in advance of us or our charterers becoming subject to them, and the implementation of such laws and regulations may be inconsistent. Changes in Chinese laws and regulations, including with regards to tax matters, or changes in their implementation by local authorities, could affect our vessels if chartered to Chinese customers as well as our vessels calling to Chinese ports and could have a material adverse impact on our business, financial conditions, and results of operations.

A recent proposal by the U.S. to impose new port fees on Chinese-operated vessels, Chinese-built vessels, non-Chinese companies operating Chinese-built vessels and companies with newbuilding orders at Chinese shipyards, and to restrict a percentage of U.S. products to being transported on U.S. vessels could have a material adverse effect on our operations and financial results.

The United States Trade Representative (the “USTR”), has recently put forward significant trade actions under Section 301 of the Trade Act of 1974 with the aim of addressing China's dominance in the maritime, logistics, and shipbuilding industries. These proposed actions, should they be enacted, have the potential to dramatically increase the port fees and overall operating expenses for ships calling at U.S. ports. Specifically, the USTR is proposing a series of service fees that would function as direct increases to port-related costs.

The proposal would include a service fee targeting Chinese operators of up to $1.0 million for each instance a vessel operated by a Chinese entity enters a U.S. port. Alternatively, the fee could be calculated at a rate of up to $1,000 per dwt of the vessel for each port entrance.

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Another proposed service fee focuses on operators with fleets comprised of Chinese-built Vessels. Under this proposal, fees could reach as high as $1.5 million each time a Chinese-built vessel owned by a non-Chinese operator enters a U.S. port. Furthermore, a tiered fee structure is under consideration, based on the proportion of Chinese-built vessels within an operator’s fleet which would apply to all such operator’s vessel, regardless of build origin. Operators with fleets that are 50% or more Chinese-built could face fees of up to $1.0 million dollars per port call; for operators with fleets that are greater than 25% and less than 50% Chinese-built, the fee could be up to $750,000 per port call; and for operators whose fleets have greater than 0% and less than 25% percent Chinese-built vessels, the port fee could reach up to $500,000 per vessel entrance. Another option being considered is an additional fee of up to $1.0 million per port entrance if 25% or more of an operator’s fleet is composed of vessels constructed in China.

A further proposed service fee is aimed at operators with newbuilding orders for Chinese vessels. This fee would be based on the percentage of vessels an operator has ordered from Chinese shipyards or expects to receive from them within the next 24 months. Operators with 50% or more of their vessel orders placed with Chinese shipyards could be charged up to $1.0 million per vessel entrance. For those with greater than 25% to less than 50% percent of their orders in Chinese shipyards, the fee could reach $750,000, and for those with greater than 0% to less than 25%, it could be up to $500,000 per vessel entrance. Another possibility is a flat fee of up to $1.0 million dollars per port entrance if 25% or more of an operator’s total vessel orders over the next 24 months are with Chinese shipyards.

Beyond these direct fee increases, the proposed actions also encompass “restrictions on services” designed to promote the transport of U.S. goods on U.S. vessels. These restrictions would be phased in over several years, starting with a requirement that a small percentage of U.S. exports be transported on U.S.-flagged vessels by U.S. operators, escalating to a larger percentage over time, with a portion specifically mandated to be on U.S.-flagged and U.S.-built vessels. Another proposed restriction would require U.S. goods to be exported on U.S.-flagged, U.S.-built vessels, with exceptions only granted if operators demonstrate that at least 20% of U.S. products per calendar year are transported on U.S.-flagged and U.S.-built vessels. These restrictions could reduce the demand for non-U.S. built vessels, including ours.

The actual implementation of these proposed actions remains uncertain. The final form, scope, and effective dates of any measures that are ultimately adopted may significantly differ from the current proposals. Additionally, specifics, such as applicability to sale and leaseback arrangements with Chinese leasing financiers, has not been clarified. In a sale and leaseback arrangement, the Chinese leasing financiers are the registered owners of the vessels. Furthermore, retaliatory measures from China or other nations could further compound disruptions and cost increases within the global shipping industry.

In addition to direct port fee increases, retaliatory actions by China or other countries could indirectly impact port-related costs. For example, China could impose retaliatory port fees or restrictions on vessels of non-Chinese origin calling at Chinese ports, which could disrupt global shipping patterns and potentially increase congestion and costs at ports worldwide, including U.S. ports.

None of the vessels we operate were constructed in China. However, we may enter into sale and leaseback transactions with Chinese financial institutions in the future. Additionally, we may enter into contracts for the purchase of secondhand vessels constructed in China or shipbuilding contracts for newbuildings constructed in Chinese shipyards. Given the potential magnitude of these proposed port-related fees and the many uncertainties surrounding their implementation, it is not possible at this time to fully predict the ultimate financial impact. However, if measures similar to those that have been proposed are implemented, port fees for our vessels or vessels we charter and our operating costs for voyages calling at U.S. ports could materially increase. Even though port fees are typically borne by the charterer, if port fees are assessed due to our ownership of the relevant vessel, it is possible that charterers may demand that we bear these costs or otherwise reduce the applicable charter rate. This, in turn, could significantly reduce our profitability, negatively impact our ability to compete effectively, and materially and adversely affect our operations and financial results.

Changing laws and evolving reporting requirements could have an adverse effect on our business.

Changing laws, regulations, and standards relating to reporting requirements, including the European Union General Data Protection Regulation, or GDPR, which relates to the collection, use, retention, security, processing, and transfer of personally identifiable information about our customers and employees, may create additional compliance requirements for us. To maintain high standards of corporate governance and public disclosure, we have invested in, and continue to invest in, reasonably necessary resources to comply with evolving standards.

GDPR broadens the scope of personal privacy laws to protect the rights of European Union citizens and requires organizations to report on data breaches within 72 hours and be bound by more stringent rules for obtaining the consent of individuals on how their data can be used. Non-compliance with GDPR or other data privacy laws may expose entities to significant fines or other regulatory claims, which could have an adverse effect on our business and results of operations.

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A cyber-attack could materially disrupt our business.

We rely on information technology systems and networks in our operations and administration of our business. Information systems are vulnerable to security breaches by computer hackers and cyber terrorists. The safety and security of our vessels as well as our business operations could be targeted by individuals or groups seeking to sabotage or disrupt our information technology systems and networks, or to steal data. Despite our cybersecurity measures, a successful cyber-attack, including as a result of spam, targeted phishing-type emails, and ransomware attacks, or other breaches of or significant interruption or failure of our information technology systems, could materially disrupt our operations, including the safety of our operations, or lead to unauthorized release of information or alteration of information in our systems. Any such attack or other breach of or significant interruption or failure of our information technology systems could have a material adverse effect on our business and results of operations. In addition, the unavailability of the information systems or the failure of these systems to perform as anticipated for any reason could disrupt our business and could result in decreased performance and increased operating costs, causing our business and results of operations to suffer. Any significant interruption or failure of our information systems or any significant breach of security could adversely affect or disrupt our business and could result in decreased performance and increased operating costs, causing our business and results of operations to suffer.

Additionally, recent action by the IMO’s Maritime Safety Committee and United States agencies indicates that cybersecurity regulations for the maritime industry are likely to be further developed in the near future in an attempt to combat cybersecurity threats. Any changes in the nature of cyber threats might require us to adopt additional procedures for monitoring cybersecurity, which could require additional expenses and/or capital expenditures. The war between Russia and Ukraine has been accompanied by cyber-attacks against the Ukrainian government and other countries in the region. It is possible that these attacks could have collateral effects on additional critical infrastructure and financial institutions globally, which could adversely affect our operations. We rely on industry-accepted security measures and technology to securely maintain confidential and proprietary information maintained on our information systems. However, these measures and technology may not adequately prevent security breaches and, therefore, it is difficult to assess the likelihood of such threat and any potential impact at this time.

In July 2023, the SEC adopted rules requiring the mandatory disclosure of material cybersecurity incidents, as well as cybersecurity governance and risk management practices. A failure to disclosure could result in the imposition of injunctions, fines and other penalties by the SEC. Complying with these obligations could cause us to incur substantial costs and could increase negative publicity surrounding any cybersecurity incident.

The smuggling of drugs or other contraband onto our vessels may lead to governmental claims against us.

Our vessels may call in ports in South America and other areas where smugglers attempt to hide drugs and other contraband on vessels, with or without the knowledge of crew members. Under some jurisdictions, vessels used for the conveyance of illegal drugs could subject such vessels to forfeiture to the government of these jurisdictions. To the extent our vessels are found with contraband, whether inside or attached to the hull of our vessels and whether with or without the knowledge of any member of our crew, we may face reputational damage and governmental or other regulatory claims or penalties which could have an adverse effect on our business, results of operations, cash flows, and financial condition, as well as our ability to maintain cash flows, including cash available for distributions to pay dividends to our shareholders.

The international nature of our operations may make the outcome of any potential bankruptcy proceedings difficult to predict.

The Marshall Islands has passed an act implementing the U.N. Commission on Internal Trade Law (UNCITRAL) Model Law on Cross-Border Insolvency, or the Model Law. The adoption of the Model Law is intended to implement effective mechanisms for dealing with issues related to cross-border insolvency proceedings and encourages cooperation and coordination between jurisdictions. Notably, the Model Law does not alter the substantive insolvency laws of any jurisdiction and does not create a bankruptcy code in the Marshall Islands. Instead, the Act allows for the recognition by the Marshall Islands of foreign insolvency proceedings, the provision of foreign creditors with access to courts in the Republic of Liberia and the Marshall Islands, and the cooperation with foreign courts. Consequently, in the event of any bankruptcy, insolvency or similar proceedings involving us or one of our subsidiaries, bankruptcy laws other than those of the United States could apply. We have limited operations in the United States. If we become a debtor under the United States bankruptcy laws, bankruptcy courts in the United States may seek to assert jurisdiction over all of our assets, wherever located, including property situated in other countries. There can be no assurance, however, that we would become a debtor in the United States or that a United States bankruptcy court would be entitled to, or accept, jurisdiction over such bankruptcy case or that courts in other countries that have jurisdiction over us and our operations would recognize a United States bankruptcy court’s jurisdiction if any other bankruptcy court would determine it had jurisdiction.

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Risks Relating to Our Common Shares

The market price of our common shares may in the future be subject to significant fluctuations. Further, there is no guarantee of a continuing public market to resell our common shares.

The market price of our common shares may in the future be subject to significant fluctuations as a result of many factors, some of which are beyond our control. Among the factors that could in the future affect our share price are:


 •
quarterly variations in our results of operations;


•
changes in market valuations of similar companies and stock market price and volume fluctuations generally;


•
changes in earnings estimates or the publication of research reports by analysts;


•
speculation in the press or investment community about our business or the shipping industry generally;


•
strategic actions by us or our competitors such as acquisitions or restructurings;


•
the thin trading market for our common shares, which makes it somewhat illiquid;


•
regulatory developments;


•
additions or departures of key personnel;


•
general market conditions; and


•
domestic and international economic, market, and currency factors unrelated to our performance.

On December 31, 2024, the closing price of our common shares on the Nasdaq Capital Market was $1.73 per share, as compared to $1.20, which was the closing price on April 7, 2025. In addition, there has from time to time in the past been significant volatility in our trading volumes on the Nasdaq Capital Market and volatility in our intra-day common share price. As a result, there is a potential for rapid and substantial decreases in the price of our common shares, including decreases unrelated to our operating performance or prospects.

The stock markets in general, and the markets for dry bulk shipping and shipping stocks in particular, have experienced extreme volatility that has sometimes been unrelated to the operating performance of individual companies. These broad market fluctuations may adversely affect the trading price of our common shares.

Additionally, there is no guarantee of a continuing public market to resell our common shares. We cannot assure you that an active and liquid public market for our common shares will continue.

We may issue additional common shares or other equity securities without your approval, which could dilute your ownership interests and may depress the market price of our common shares.

We may issue additional common shares or other equity securities of equal or senior rank in the future in connection with, among other things, future vessel acquisitions, repayment of outstanding indebtedness, or our equity incentive plan, without shareholder approval, in a number of circumstances.

In addition, as of April 7, 2025, we may be obliged to issue up to 6,962,770 additional common shares pursuant to the terms of our outstanding Class A Warrants at an exercise price of $2.25 per common share, subject to adjustment pursuant to the terms of such warrants.

Our issuance of additional common shares or other equity securities of equal or senior rank would have the following effects:


 •
our existing shareholders’ proportionate ownership interest in us will decrease;


•
the amount of cash available for dividends payable per common share may decrease;


•
the relative voting strength of each previously outstanding common share may be diminished; and


•
the market price of our common shares may decline.

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A possible “short squeeze” due to a sudden increase in demand of our common shares that largely exceeds supply may lead to further price volatility in our common shares.

Investors may purchase our common shares to hedge existing exposure in our common shares or to speculate on the price of our common shares. Speculation on the price of our common shares may involve long and short exposures. To the extent aggregate short exposure exceeds the number of common shares available for purchase in the open market, investors with short exposure may have to pay a premium to repurchase our common shares for delivery to lenders of our common shares. Those repurchases may in turn, dramatically increase the price of our common shares until investors with short exposure are able to purchase additional common shares to cover their short position. This is often referred to as a “short squeeze.” Following such a short squeeze, once investors purchase the shares necessary to cover their short position, the price of our common shares may rapidly decline. A short squeeze could lead to volatile price movements in our shares that are not directly correlated to the performance or prospects of our company.

We may not have the surplus or net profits required by law to pay dividends. The declaration and payment of dividends will always be subject to the discretion of our board of directors and will depend on a number of factors. Our board of directors may not declare dividends in the future.

The declaration, timing, and amount of any dividend is subject to the discretion of our board of directors and will be dependent upon our earnings, financial condition, market prospects, capital expenditure requirements, investment opportunities, restrictions in our loan agreements, the provisions of Marshall Islands law affecting the payment of dividends to shareholders, overall market conditions, and other factors. Our board of directors may not declare dividends in the future.

Further, Marshall Islands law generally prohibits the payment of dividends if the company is insolvent or would be rendered insolvent upon payment of such dividend, and dividends may be declared and paid out of our operating surplus. Dividends may also be declared or paid out of net profits for the fiscal year in which the dividend is declared and for the preceding fiscal year. We may not have the required surplus or net profits to pay dividends, and we may be unable to pay dividends in any anticipated amount or at all.

The superior voting rights of our Series B Preferred Shares may limit the ability of our common shareholders to control or influence corporate matters and the interests of the holder of such shares could conflict with the interests of common shareholders

While our common shares have one vote per share, each of our 40,000 Series B preferred shares (“Series B Preferred Shares”) presently outstanding has 25,000 votes per share; however, the voting power of the Series B Preferred Shares is limited such that no holder of Series B Preferred Shares may exercise voting rights pursuant to any Series B Preferred Shares that would result in the total number of votes a holder is entitled to vote on any matter submitted to a vote of shareholders of the Company to exceed 49.99% of the total number of votes eligible to be cast on such matter. The Series B Preferred Shares, however, have no dividend rights or distribution rights, other than the right upon dissolution to receive a payment equal to $0.0001 per share.

As of the date of this annual report, our Chairman and Chief Executive Officer can therefore control 49.99% of the voting power of our outstanding capital stock. Our Chairman and Chief Executive Officer has substantial control and influence over our management and affairs and over matters requiring shareholder approval, including the election of directors and significant corporate transactions, even though he owns significantly less than 50% of the Company economically.

The superior voting rights of our Series B Preferred Shares may limit our common shareholders’ ability to influence corporate matters. The interests of the holder of the Series B Preferred Shares may conflict with the interests of our common shareholders, and as a result, the holders of our capital stock may approve actions that our common shareholders do not view as beneficial. Any such conflicts of interest could adversely affect our business, financial condition, results of operations, and the trading price of our common shares.

Anti-takeover provisions in our amended and restated articles of incorporation and our amended and second amended and restated bylaws could make it difficult for our shareholders to replace or remove our current board of directors or could have the effect of discouraging, delaying, or preventing a merger or acquisition, which could adversely affect the market price of our common shares.

Several provisions of our amended and restated articles of incorporation and our second amended and restated bylaws may have anti-takeover effects. These provisions are intended to avoid costly takeover battles, lessen our vulnerability to a hostile change of control, and enhance the ability of our board to maximize shareholder value in connection with any unsolicited offer to acquire our company. However, these anti-take-over provisions could make it difficult for our shareholders to change the composition of our board of directors in any one year, preventing them from changing the composition of our management. In addition, the same provisions may discourage, delay, or prevent a merger or acquisition that some shareholders may consider favorable.

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These provisions:


 •
authorize our board of directors to issue “blank check” preferred stock without shareholder approval, including preferred shares with superior voting rights, such as the Series B Preferred Shares;


•
provide for a classified board of directors with staggered, three-year terms;


•
permit the removal of any director only for cause;


•
prohibit shareholder action by written consent unless the written consent is signed by all shareholders entitled to vote on the action;


•
limit the persons who may call special meetings of shareholders; and


•
establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted on by shareholders at meetings of shareholders.

These anti-takeover provisions could substantially impede the ability of our shareholders to impose a change in control and, as a result, may adversely affect the market price of our common shares and your ability to realize any potential change of control premium.

Our second amended and restated bylaws provide that the High Court of the Republic of Marshall Islands shall be the sole and exclusive forum for certain disputes between us and our shareholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.

Our second amended and restated bylaws provide that, unless the Company consents in writing to the selection of an alternative forum, the High Court of the Republic of Marshall Islands shall be the sole and exclusive forum for (i) any shareholders’ derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, or employee of the Corporation to the Corporation or the Corporation’s shareholders, (iii) any action asserting a claim arising pursuant to any provision of the Business Corporations Act of the Republic of the Marshall Islands (as amended from time to time), or (iv) any action asserting a claim governed by the internal affairs doctrine. This forum selection provision may limit a shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage lawsuits with respect to such claims.

We may not achieve the intended benefits of having a forum selection provision if it is found to be unenforceable.

Our second amended and restated bylaws include a forum selection provision as described above. However, the enforceability of similar forum selection provisions in other companies’ governing documents has been challenged in legal proceedings, and it is possible that in connection with any action a court could find the forum selection provision contained in our second amended and restated bylaws to be inapplicable or unenforceable in such action. In particular, Section 27 of the Exchange Act, creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. In addition, Section 22 of the Securities Act of 1933, as amended (the “Securities Act”), creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Shareholders’ derivative actions, including those arising under the Exchange Act or Securities Act, are subject to our forum selection provision. To the extent that the exclusive forum provision would apply to restrict the courts in which our shareholders may bring claims arising under the Exchange Act or the Securities Act and the rules and regulations thereunder, there is uncertainty as to whether a court would enforce such a provision. Investors cannot waive compliance with the federal securities laws and the rules and regulations promulgated thereunder. If a court were to find the forum selection provision to be inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business, financial condition, and results of operations.

Issuance of preferred shares, such as our Series B Preferred Shares, may adversely affect the voting power of our common shareholders and have the effect of discouraging, delaying, or preventing a merger or acquisition, which could adversely affect the market price of our common shares.

Our amended and restated articles of incorporation authorize our board of directors to issue preferred shares in one or more series and to determine the rights, preferences, privileges, and restrictions with respect to, among other things, dividends, conversion, voting, redemption, liquidation, and the number of shares constituting any series without shareholders’ approval. Our board of directors issued prior to the Spin-Off (as described below), and may in the future issue, preferred shares with voting rights superior to those of the common shares, such as the Series B Preferred Shares. If our board of directors determines to issue preferred shares, such issuance may discourage, delay, or prevent a merger or acquisition that shareholders may consider favorable. The issuance of preferred shares with voting and conversion rights may also adversely affect the voting power of the holders of common shares. This could substantially impede the ability of public shareholders to benefit from a change in control and, as a result, may adversely affect the market price of our common shares and our shareholders’ ability to realize any potential change of control premium.

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We may not be able to maintain compliance with the Nasdaq Capital Market’s continued listing requirements.

Our common shares are listed on the Nasdaq Capital Market. There are a number of continued listing requirements that we must satisfy in order to maintain our listing on the Nasdaq Capital Market. We may not be able to maintain compliance with the Nasdaq Capital Market’s continued listing requirements. If we fail to maintain compliance with all applicable continued listing requirements for the Nasdaq Capital Market and Nasdaq determines to delist our common shares, the delisting could adversely affect the market liquidity of our common shares and our ability to obtain financing to repay any debt and fund our operations.

We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common shares less attractive to investors.

We are an “emerging growth company” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. While we have elected to take advantage of some of the reduced reporting obligations, we are choosing to “opt-out” of the extended transition period relating to the exemption from new or revised financial accounting standards. We cannot predict if investors will find our common shares less attractive because we may rely on these exemptions. If some investors find our common shares less attractive as a result, there may be a less active trading market for our common shares and our share price may be more volatile.

In addition, under the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, or Sarbanes-Oxley, for so long as we are an emerging growth company. For as long as we take advantage of the reduced reporting obligations, the information that we provide shareholders may be different from information provided by other public companies.

We are incorporated in the Republic of the Marshall Islands, which does not have a well-developed body of corporate law, which may negatively affect the ability of shareholders to protect their interests.

Our corporate affairs are governed by our amended and restated articles of incorporation, our second amended and restated bylaws, and the Marshall Islands Business Corporations Act, or the BCA. The provisions of the BCA resemble provisions of the corporation laws of a number of states in the United States. However, there have been few judicial cases in the Republic of the Marshall Islands interpreting the BCA. The rights and fiduciary responsibilities of directors under the laws of the Republic of the Marshall Islands are not as clearly established as the rights and fiduciary responsibilities of directors under statutes or judicial precedent in existence in certain U.S. jurisdictions. Shareholder rights may differ as well. While the BCA does specifically incorporate the non-statutory law, or judicial case law, of the State of Delaware and other states with substantially similar legislative provisions, shareholders may have more difficulty in protecting their interests in the face of actions by the management, directors, or controlling shareholders than would shareholders of a corporation incorporated in a U.S. jurisdiction.

Additionally, the Republic of the Marshall Islands does not have a legal provision for bankruptcy or a general statutory mechanism for insolvency proceedings. As such, in the event of a future insolvency or bankruptcy, our shareholders and creditors may experience delays in their ability to recover for their claims after any such insolvency or bankruptcy. Further, in the event of any bankruptcy, insolvency, liquidation, dissolution, reorganization, or similar proceeding involving us or any of our subsidiaries, bankruptcy laws other than those of the United States could apply. If we become a debtor under U.S. bankruptcy law, bankruptcy courts in the United States may seek to assert jurisdiction over all of our assets, wherever located, including property situated in other countries. There can be no assurance, however, that we would become a debtor in the United States, or that a U.S. bankruptcy court would be entitled to, or accept, jurisdiction over such a bankruptcy case, or that courts in other countries that have jurisdiction over us and our operations would recognize a U.S. bankruptcy court’s jurisdiction if any other bankruptcy court would determine it had jurisdiction.

As a Marshall Islands corporation with principal executive offices in Greece, and also having subsidiaries in the Republic of the Marshall Islands and the Republic of Liberia, our operations may be subject to economic substance requirements.

The Council of the European Union, or the Council, routinely publishes a list of “non-cooperative jurisdictions” for tax purposes which includes countries that the Council believes need to improve their legal framework and to work towards compliance with international standards in taxation. In 2019, the Republic of the Marshall Islands, among others, was placed by the EU on the list of non-cooperative jurisdictions for failing to implement certain commitments previously made to the EU by the agreed deadline. However, it was removed from the list of non-cooperative jurisdictions later in 2019. In February 2023, the Republic of the Marshall Islands (among others) was again placed on the list of non-cooperative jurisdictions for lacking in the enforcement of economic substance requirement and was subsequently removed from such list in October 2023. EU member states have agreed upon a set of measures, which they can choose to apply against the listed countries, including, increased monitoring and audits, withholding taxes and non-deductibility of costs , and although we are not currently aware of any such measures being adopted, they can be adopted by one or more EU members states in the future. The European Commission has stated it will continue to support member states’ efforts to develop a more coordinated approach to sanctions for the listed countries. EU legislation prohibits certain EU funds from being channeled or transited through entities in non-cooperative jurisdictions.

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We are a Marshall Islands corporation with principal executive offices in Greece. All of our subsidiaries are organized in the Republic of the Marshall Islands and the Republic of Liberia. The Marshall Islands have enacted economic substance regulations relating to, inter alia, shipping business activities, with which we are obligated to comply. The Marshall Islands economic substance regulations require certain entities that carry out particular activities to comply with a three-part economic substance test whereby the entity must show that it (i) is directed and managed in the Marshall Islands in relation to that relevant activity, (ii) carries out core income-generating activity in relation to that relevant activity in the Marshall Islands (although it is being understood and acknowledged by the regulators that income-generating activities for shipping companies will generally occur in international waters) and (iii) having regard to the level of relevant activity carried out in the Marshall Islands has (a) an adequate amount of expenditures in the Marshall Islands, (b) adequate physical presence in the Marshall Islands and (c) an adequate number of qualified employees in the Marshall Islands.

If we fail to comply with our obligations under such regulations or any similar law applicable to us in any other jurisdictions, we could be subject to financial penalties and spontaneous disclosure of information to foreign tax officials, or with respect to the Marshall Islands economic substance requirements, revocation of the formation documents and dissolution of the applicable non-compliant Marshall Islands entity, or being struck from the register of companies. Any of the foregoing could be disruptive to our business and could have a material adverse effect on our business, financial conditions and operating results. Accordingly, any implementation of, or changes to, any of the economic substance regulations that impact us could increase the complexity and costs of carrying on business in these jurisdictions, and thus could adversely affect our business, financial condition or results of operations.

We do not know (i) if the EU will once again add the Republic of the Marshall Islands to the list of non-cooperative jurisdictions, or add Liberia to the list, (ii) what actions any such jurisdiction may take, if any, to remove itself from such list if it should be placed back on the list of non-cooperative jurisdictions, (iii) how quickly the EU would react to any changes in legislation of the relevant jurisdictions, or (iv) how EU banks or other counterparties will react while we or our subsidiaries remain as entities organized and existing under the laws of listed countries during a period if the jurisdictions are placed on the list of non-cooperative jurisdictions. The effect of the EU list of non-cooperative jurisdictions, and any non-compliance by us with any legislation or regulations adopted by applicable countries to achieve removal from the list, including economic substance regulations, could have a material adverse effect on our business, financial conditions and operating results.

It may not be possible for investors to serve process on or enforce U.S. judgments against us.

We and all of our subsidiaries are incorporated in jurisdictions outside the U.S. and substantially all of our assets and those of our subsidiaries are located outside the U.S. In addition, most of our directors and officers are non-residents of the U.S., and all or a substantial portion of the assets of these non-residents are located outside the U.S. As a result, it may be difficult or impossible for U.S. investors to serve process within the U.S. upon us, our subsidiaries or our directors and officers or to enforce a judgment against us for civil liabilities in U.S. courts. In addition, you should not assume that courts in the countries in which we or our subsidiaries are incorporated or where our assets or the assets of our subsidiaries are located (1) would enforce judgments of U.S. courts obtained in actions against us or our subsidiaries based upon the civil liability provisions of applicable U.S. federal and state securities laws or (2) would enforce, in original actions, liabilities against us or our subsidiaries based on those laws.

ITEM 4.
INFORMATION ON THE COMPANY

A.
History and Development of the Company

Overview

United Maritime Corporation is an international shipping company currently specializing in worldwide seaborne transportation services. We currently operate a fleet of eight dry bulk vessels, comprising three Panamax, three Capesize and two Kamsarmax vessels with an aggregate cargo-carrying capacity of approximately 922,072 dwt and an age of approximately 15.0 years. In December 2024, the Company entered into an agreement with an unaffiliated third party for the sale of its Capesize vessel, M/V Gloriuship, which is anticipated to be delivered to its new owners latest by mid-July 2025. Upon the completion of the sale of this vessel, the Company’s operating fleet will consist of seven dry bulk vessels, with an aggregate cargo carrying capacity of 750,758 dwt.

We were incorporated under the laws of the Republic of the Marshall Islands, pursuant to the BCA, on January 20, 2022. Our executive offices are located at 154 Vouliagmenis Avenue, 16674 Glyfada, Greece and our telephone number is +30 2130181507. Our website is www.unitedmaritime.gr. The Commission maintains a website that contains reports, proxy and information statements, and other information that we file electronically at www.sec.gov. The information contained on, or that can be accessed through, these websites is not incorporated by reference herein and does not form part of this annual report.

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We were incorporated by Seanergy to serve as the holding company of the United Maritime Predecessor upon effectiveness of the spin-off (the “Spin-Off”). Pursuant to the Spin-Off, Seanergy contributed the United Maritime Predecessor to us and $5.0 million in working capital in exchange for the distribution of all of our issued and outstanding common shares to Seanergy’s shareholders, 40,000 of our Series B Preferred Shares, par value $0.0001 to the holder of all Seanergy’s issued and outstanding Series B preferred shares and 5,000 of our 6.5% Series C Cumulative Convertible Perpetual Preferred Shares (“Series C Preferred Shares”) to Seanergy.

While our common shares hold one vote per share, the Series B Preferred Shares hold 25,000 votes per share, subject to the limitation that no holder of Series B Preferred Shares may exercise voting rights pursuant to any Series B Preferred Shares that would result in the total number of votes such holder is entitled to vote on any matter submitted to a vote of shareholders to exceed 49.99% of the total number of votes eligible to be cast on such matter. The Series B Preferred Shares have no substantial economic rights but entitle our Chairman and Chief Executive Officer to exercise voting power equal to 49.99% of the total number of votes entitled to vote on any matter submitted to a vote of our shareholders.

The Series C Preferred Shares had a cumulative preferred dividend accruing at the rate of 6.5% per annum which could be paid in cash or, at our election, in kind, and contained a liquidation preference equal to their stated value of $1,000 per share and were convertible into common shares at the holder’s option commencing upon the first anniversary of the original issue date, at a conversion price equal to the lesser of $9.00 and the 10-trading-day trailing VWAP of our common shares, subject to certain anti-dilution and other customary adjustments. We had the right, at our option, at any time three months after the original date of issuance of the Series C Preferred Shares, to redeem the Series C Preferred Shares, in whole or from time to time in part at a price per Series C Preferred Share equal to 105% of the stated value plus accrued and unpaid dividends up to the redemption date.

Additionally, prior to the Spin-Off, we entered into an agreement with Seanergy pursuant to which Seanergy has a right of first refusal with respect to any opportunity available to us to sell, acquire or charter-in any Capesize vessel as well as with respect to chartering opportunities, other than short-term charters available to us for Capesize vessels. In addition, we have a right of first offer with respect to any vessel sales by Seanergy (the “ROFR”).

Following the Spin-Off, we and Seanergy became independent publicly traded companies. All references in this annual report to us for periods prior to the Spin-Off refer to the United Maritime Predecessor. The financial statements presented in this annual report for periods from January 1, 2022 to July 5, 2022 and for the fiscal year ended December 31, 2021 are carve-out financial statements of Seanergy’s consolidated historical financial statements.

Our common shares are listed on Nasdaq and began trading on the Nasdaq Capital Market on July 6, 2022 under the symbol “USEA”.

On July 11, 2022, we entered into separate memoranda of agreement with unaffiliated third parties, to acquire four secondhand tanker vessels, which were renamed M/T Parosea, M/T Bluesea, M/T Minoansea and M/T Epanastasea (the “Acquired Vessels”), for an aggregate purchase price of $79.5 million. We took delivery of M/T Parosea, M/T Bluesea and M/T Minoansea in August 2022, and delivery of the M/T Epanastasea in September 2022. We sold all four of these vessels as follows: (i) in November 2022, we sold the M/T Parosea to an unaffiliated third-party for a gross sale price of $31.3 million; (ii) in December 2022, we sold the M/T Minoansea and M/T Bluesea to an unaffiliated third-party for an aggregate gross sale price of $70.3 million; and (iii) in August 2023, we sold the M/T Epanastasea to an unaffiliated third party for a gross sale price of $37.5 million.

On July 20, 2022, we completed an underwritten public offering of 8,000,000 units at a public offering price of $3.25 consisting of (i) one common share (or one pre-funded warrant in lieu of one common share) and (ii) one Class A warrant to purchase one common share at an exercise price of $3.25. The gross proceeds of the offering were approximately $26.0 million. All the 1,200,000 pre-funded warrants issued in connection with the offering were exercised by the end of July 2022. As of April 7, 2025, 6,962,770 Class A warrants were outstanding expiring on July 20, 2027.

On July 26, 2022, we issued an additional 5,000 Series C Preferred Shares to Seanergy in exchange for $5.0 million payable in cash in connection with the funding of the advance deposits payable for the Acquired Vessels.

In August and September 2022, our board of directors authorized two buyback programs of $6.0 million in total pursuant to which 3,289,791 of our common shares were repurchased at an average price of $1.81 per share. In October 2022, our board of directors authorized a third share buyback plan, pursuant to which we may repurchase up to an additional $3.0 million of our outstanding common shares in the open market. As extended, this plan was set to expire on December 31, 2024. On December 17, 2024, the Company authorized the extension of its existing $3.0 million share repurchase plan. The program has been extended for a further 12-month period. Under the program, the Company may repurchase up to $3.0 million of its outstanding common shares in the open market. As of April 7, 2025, approximately $1.9 million remained available for repurchase, and the program will remain effective through the period ending December 31, 2025.

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In October 2022, the Compensation Committee (the “Compensation Committee”) of our board of directors granted awards under the plan of an aggregate of 1,000,000 restricted common shares. Of the total 1,000,000 shares issued, 800,000 shares were granted to the members of the board of directors of the Company and 200,000 shares were granted to certain of the Company’s service providers. The fair value of each share on the grant date was $2.28. The shares vested as follows: 333,344 shares vested on October 14, 2022, 333,328 shares vested on January 5, 2023 and 333,328 shares vested on June 5, 2023.

In November 2022, we fully redeemed the 10,000 Series C Preferred Shares issued to Seanergy at a price equal to 105% of the original issue price for an aggregate amount of $10.6 million, including all accrued and unpaid dividends up to the redemption date.

On November 29, 2022, we announced that our board of directors declared a special cash dividend of $1.00 per common share in connection with the profitable sales of the M/T Bluesea and M/T Parosea. The dividend was paid around January 10, 2023. Pursuant to the provisions of the Class A warrants, the exercise price of the warrants was adjusted from $3.25, pursuant to the provisions of the warrant agreement, by the dividend amount, to $2.25 per common share effective January 11, 2023.

In December 2022, we entered into definitive agreements to acquire two Capesize vessels, the M/V Goodship and M/V Tradership from Seanergy for an aggregate purchase price of $36.25 million. The purchase of the vessels was made pursuant to the ROFR and the acquisition was approved by a special independent committee of our board of directors.

In December 2022, the Compensation Committee of our board of directors approved the amendment and restatement of our 2022 Equity Incentive Plan (“2022 Equity Incentive Plan”) to increase the aggregate number of common shares reserved for issuance under the plan to 1,500,000 shares and granted awards under the plan to our directors and certain service providers of an aggregate of 700,000 restricted common shares. Of the total 700,000 shares issued, 580,000 shares were granted to the members of our board of directors and 120,000 shares were granted to certain of the Company’s service providers. The fair value of each share on the grant date was $4.33. On December 28, 2022, 233,340 shares vested, while 233,330 shares vested on June 5, 2023 and 233,330 shares vested on October 5, 2023.

On February 7, 2023, we entered into agreements with two unaffiliated third parties to purchase two Kamsarmax dry bulk vessels for an aggregate purchase price of $39.2 million, which were financed through a combination of cash on hand and proceeds from the Neptune Maritime Leasing Ltd. (“Neptune”) sale and leaseback transactions described under “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources – Sale and Leaseback Transactions – March 2023 Neptune Sale and Leaseback” and “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources – Sale and Leaseback Transactions – April 2023 Neptune Sale and Leaseback”. The first vessel, which was renamed M/V Oasea, was built in 2010 at Tsuneishi Zhoushan Shipbuilding, has a cargo-carrying capacity of 82,217 dwt and was delivered to the Company on March 27, 2023. The second vessel, which was renamed M/V Cretansea, was built in 2009 at Universal Shipbuilding in Japan, has a cargo-carrying capacity of 81,508 dwt and was delivered to the Company on April 26, 2023.

On February 9, 2023, we entered into a bareboat charter agreement with an unaffiliated third party for a secondhand Panamax vessel, which was renamed M/V Chrisea. The vessel was delivered to the Company on February 21, 2023 under an 18-month bareboat charter at a daily rate of $7,300, a downpayment of $7.0 million and a purchase option of $12.4 million at the end of the charter period. In aggregate, the acquisition cost for the vessel, following the exercise of the purchase option, was approximately $23.4 million.

On February 10, 2023, we took delivery of the M/V Goodship. The acquisition of the M/V Goodship was financed by cash on hand and secured the amount of $7.0 million of the August 2022 EnTrust Facility (as defined in “Item 5. Operating and Financial Review and Prospects”) pursuant to an amendment and restatement of the subject facility which was signed on January 30, 2023.

On February 21, 2023, we declared the initiation of a regular quarterly cash dividend of $0.075 per common share and the declaration of a dividend of $0.075 per share for the fourth quarter of 2022. The quarterly dividend was paid on April 6, 2023 to all shareholders of record as of March 22, 2023.

On February 28, 2023, we took delivery of the M/V Tradership. The acquisition of the M/V Tradership was financed by cash on hand and secured the amount of $8.2 million of the August 2022 EnTrust Facility (as defined in “Item 5. Operating and Financial Review and Prospects”) pursuant to an amendment and restatement of the subject facility which was signed on January 30, 2023.

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On May 17, 2023, we declared a quarterly cash dividend of $0.075 per common share for the first quarter of 2023. The quarterly dividend was paid on July 6, 2023 to all shareholders of record as of June 22, 2023.

On August 1, 2023, we took delivery of the 78,020 dwt M/V Synthesea built in 2015 in Japan. The M/V Synthesea was chartered under a 12-month bareboat charter agreement, with a daily charter rate of $8,000 over the period of the bareboat charter, a downpayment of $7.0 million and a purchase option of $17.1 million at the end of the bareboat charter. In aggregate, the acquisition cost for the vessel, following the exercise of the purchase option, was approximately $27.0 million.

On August 1, 2023, we declared a quarterly cash dividend of $0.075 per common share for the second quarter of 2023. The quarterly dividend was paid on October 6, 2023 to all shareholders of record as of September 22, 2023.

On August 9, 2023, as part of the sale of the M/T Epanastasea and the acquisition of the M/V Exelixsea, we replaced the collateral under the respective tranche previously secured by the M/T Epanastasea in the August 2022 EnTrust Facility. For more information, see “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources— Loan Arrangements —August 2022 EnTrust Facility”.

On August 29, 2023, we took delivery of the 76,361 dwt M/V Exelixsea built in 2011 in Japan. The M/V Exelixsea was acquired for a gross purchase price of $17.8 million, which was funded by our cash reserves, including the cash-collateralized $15.0 million of the August 2022 EnTrust Facility (as defined in “Item 5. Operating and Financial Review and Prospects”) previously secured by the M/T Epanastasea.

On November 14, 2023, we declared a quarterly cash dividend of $0.075 per common share for the third quarter of 2023. The quarterly dividend was paid on January 10, 2024, payable to all shareholders of record as of December 22, 2023.

On November 15, 2023, we entered into three separate and identical $10.0 million sale and leaseback agreements for the M/Vs Gloriuship, Goodship and Tradership with affiliates of Huarong Chinese lessor, for the purpose of refinancing the outstanding indebtedness of the respective vessels under the August 2022 EnTrust Facility. For more information, see “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources— Sale and Leaseback Transactions—Huarong Sale and Leaseback".

On February 19, 2024, we declared a quarterly cash dividend of $0.075 per common share for the fourth quarter of 2023. The quarterly dividend was paid on April 10, 2024 to all shareholders of record as of March 22, 2023.

On February 22, 2024, we entered into a $13.8 million sale and leaseback agreement with an unaffiliated third party in order to refinance the August 2022 EnTrust Facility secured by the M/V Exelixsea. For more information, see “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources— Sale and Leaseback Transactions—Village Seven Sale and Leaseback”.

On March 6, 2024, we entered into a bareboat charter agreement with an unaffiliated third party for an 82,235 dwt Kamsarmax dry bulk carrier built in 2016 in Japan, which was renamed M/V Nisea. The vessel was delivered to the Company on September 10, 2024, under an 18-month bareboat charter at a daily rate of $8,000, a downpayment of $7.5 million and a purchase option of $16.6 million at the end of the charter period. In aggregate, the acquisition cost for the vessel, following the exercise of the purchase option, will be approximately $28.4 million.

On March 27, 2024, the Compensation Committee of our board of directors approved the amendment and restatement of our 2022 Equity Incentive Plan to increase the aggregate number of common shares reserved for issuance under the plan to 400,000 shares, and granted awards under the plan of an aggregate of 260,000 common shares to the members of the Company’s board of directors and 75,000 common shares to certain of the Company’s service providers and to the sole director of the Company’s commercial manager, a non-employee. The fair value of each share on the grant date was $2.635. On March 27, 2024, 67,000 shares vested, while 100,500 shares vested on September 27, 2024 and 167,500 shares vested on March 27, 2025.

On March 27, 2024, the August 2022 EnTrust Facility was refinanced with the Village Seven Sale and Leaseback. For more information, see “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources— Loan Arrangements —August 2022 EnTrust Facility.”

On May 23, 2024, we declared a quarterly cash dividend of $0.075 per common share for the first quarter of 2024. The quarterly dividend was paid on July 10, 2024 to all shareholders of record as of June 25, 2024.

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On July 19, 2024, we sold the M/V Oasea to an unaffiliated third party for a gross sale price of $20.2 million.

On July 31, 2024, the Company entered into shareholder and subscription agreements to acquire a minority stake in a Norwegian-based company, which participates under a newbuilding contract in the construction of a technically and environmentally advanced Energy Construction Vessel (“ECV”). The ECV is intended to inspect, maintain, and repair offshore energy production infrastructure in both the oil and gas and renewables industries. United will commit capital of up to EUR 7.8 million, scheduled to be called in five separate installments over a period of 33 months, matching the different stages of the ECV’s building process. As of April 7, 2025, we have paid two installments amounting in aggregate to EUR 3.4 million (both amounts were paid within 2024).

On August 1, 2024, we exercised the purchase option and took delivery of the M/V Synthesea, for a price of $17.1 million. The exercise of the purchase option was financed with proceeds from the Onishi Sale and Leaseback, as described herein. For more information, see “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources—Sale and Leaseback Transactions—Onishi Sale and Leaseback”.

On August 5, 2024, we declared a quarterly cash dividend of $0.075 per common share for the second quarter of 2024. The quarterly dividend was paid on October 10, 2024 to all shareholders of record as of September 27, 2024.

On August 21, 2024, we exercised the purchase option and took delivery of the M/V Chrisea, for a price of $12.4 million. The exercise of the purchase option was financed with proceeds from the Sinopac Loan Facility, as described herein. For more information, see “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources— Loan Arrangements —Sinopac Loan Facility”.

On November 25, 2024, we declared a quarterly cash dividend of $0.075 per common share for the third quarter of 2024. The quarterly dividend was paid on January 10, 2025 to all shareholders of record as of December 27, 2024.

On December 20, 2024, the Company entered into a definitive agreement with an unaffiliated third party for the sale of its 171,314 dwt Capesize vessel, M/V Gloriuship, built in 2004. The vessel is expected to be delivered to its new owners by mid-July 2025. The aggregate net sale price is approximately $15.0 million, and the transaction is subject to customary closing procedures.

On March 17, 2025, we declared a quarterly cash dividend of $0.01 per common share for the fourth quarter of 2024. The quarterly dividend was paid on April 10, 2025 to all shareholders of record as of March 27, 2025.

On April 7, 2025, the Compensation Committee of our board of directors approved a further amendment and restatement of our 2022 Equity Incentive Plan to increase the aggregate number of common shares reserved for issuance under the plan to 400,000 shares, and granted awards under the plan of an aggregate of 275,000 common shares to the members of the Company’s board of directors and 85,000 common shares to certain of the Company’s service providers and to the sole director of the Company’s commercial manager, a non-employee. The fair value of each share on the grant date was $1.20. 79,500 shares vested on April 7, 2025, 113,000 shares will vest on October 7, 2025 and 167,500 shares will vest on April 7, 2026.

B.
Business Overview

We are an international shipping company currently specializing in worldwide seaborne transportation services. We currently operate three Capesize dry bulk vessels, two Kamsarmax dry bulk vessels and three Panamax dry bulk vessels, with an aggregate cargo-carrying capacity of approximately 922,072 dwt and an age of approximately 15.0 years. In December 2024, the Company entered into an agreement with an unaffiliated third party for the sale of its Capesize vessel, M/V Gloriuship, which is to be delivered to its new owners by mid-July 2025. Upon the completion of the sale of this vessel, the Company’s operating fleet will consist of seven dry bulk vessels, which an aggregate cargo carrying capacity of 750,758 dwt.

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Our Current Fleet

The following table lists the vessel in our fleet as of the date of this annual report:
Vessel Name
  
​Size Class
  
Year
Built
  
Dwt
  
Flag
  
Yard
  
Type of
Employment
Goodship
  
Capesize
  
2005
  
177,536
  
LIB
  
Mitsui
  
T/C Index Linked (1)
Tradership
  
Capesize
  
2006
  
176,925
  
MI
  
Namura
  
T/C Index Linked (2)
Gloriuship
  
Capesize
  
2004
  
171,314
  
MI
  
Hyundai
  
Spot Employment
Nisea
  
Kamsarmax
  
2016
  
    82,235
  
LIB
  
Oshima
  
T/C Fixed Rate (3)
Cretansea
  
Kamsarmax
  
2009
  
81,508
  
MI
  
Universal
  
T/C Index Linked (4)
Chrisea
  
Panamax
  
2013
  
78,173
  
MI
  
Shin Kurushima
  
T/C Index Linked (5)
Synthesea
  
Panamax
  
2015
  
78,020
  
LIB
  
Sasebo
  
T/C Index Linked (6)
Exelixsea
  
Panamax
  
2011
  
76,361
  
MI
  
Oshima
  
T/C Index Linked (7)
Key to Flags: MI – Marshall Islands, LIB – Liberia


(1)
Chartered by a dry bulk operator and delivered to the charterer on October 17, 2023 for a period of about 11 to about 13 months. The daily charter hire is based on the BCI. In addition, the time charter provides us with the option to convert the index linked rate to a fixed rate for a period of between two and 12 months priced at the prevailing Capesize FFA for the selected period. On July 16, 2024, the charterer agreed to extend the time charter agreement in direct continuation from the previous agreement. On July 30, 2024, the new time charter period commenced for a duration of minimum October 15, 2025 up to maximum December 31, 2025.

(2)
Chartered by a major European charterer and delivered to the charterer on July 26, 2022 for a period employment of about 11 to about 15 months. The daily charter hire is based on the BCI. In addition, the time charter provides us with the option to convert the index linked rate to a fixed rate for a period of between three and nine months priced at the prevailing Capesize FFA for the selected period. Following two consecutive extensions, the new extended time charter period is for a duration of minimum January 1, 2025 up to maximum June 1, 2025.

(3)
Chartered by an international commodities trader and delivered to the charterer on September 19, 2024, for a period employment of about 10 to about 12 months at a fixed daily charter hire of $16,500.

(4)
Chartered by an international commodities trader and delivered to the charterer on October 22, 2024 for a period employment of about 11 to about 13 months. The daily charter hire is based on the BPI. In addition, the time charter provides us with the option to convert the variable charter hire to a fixed rate for a period of minimum two months priced at the prevailing Panamax FFA rate for the selected period.

(5)
Chartered by an international commodities trader and delivered to the charterer on June 9, 2024 for a period employment of about 12 to about 15 months. The daily charter hire is based on the BPI. In addition, the time charter provides us with the option to convert the index linked rate to a fixed rate for the remaining period employment based on the prevailing Panamax FFA for the selected period.

(6)
Chartered by an international commodities trader and delivered to the charterer on August 3, 2023 for a period employment of minimum 14 to about 16 months. The daily charter hire is based on the BPI. In addition, the time charter provides us with the option to convert the index linked rate to a fixed rate for a period of minimum two months based on the prevailing Panamax FFA for the selected period. On July 10, 2024, the charterer agreed to extend the time charter  agreement in direct continuation from the previous agreement. On October 1, 2024, the new time charter period commenced for a duration of about 11 months to 14 months.

(7)
Chartered by an international commodities trader and delivered to the charterer on August 31, 2023 for a period employment of minimum 11 to about 14 months. The daily charter hire is based on the BPI. In addition, the time charter provides us with the option to convert the index linked rate to a fixed rate for a period of minimum two months based on the prevailing Panamax FFA for the selected period. On July 10, 2024, the charterer agreed to extend the time charter agreement in direct continuation from the previous agreement. On August 15, 2024, the new time charter period commenced for a duration of about 11 to about 14 months.

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Our Business Strategy

Competitive Strengths

Opportunity for growth. We believe we are well positioned to continue to opportunistically expand and maximize our current fleet due to our competitive cost structure, strong customer relationships and experienced management team.

Demonstrated access to financing. We believe that we are well-placed to take advantage of business opportunities due to Seanergy’s operational platform, which we aim to leverage, along with our management team’s access to financing, as demonstrated through their course in Seanergy. We believe that our ability to access financing will continue to allow us to capture additional market opportunities when they arise.

Experienced management team. Certain officers and directors of Seanergy serve on our board of directors and management team and as such we believe that our management team’s reputation and track record in building shipping fleets provides us with access to attractive acquisition, chartering and vessel-financing opportunities. Our management team has managed to repeatedly source vessel acquisition opportunities in the secondhand market for both ourselves and Seanergy, and then to profitably operate or dispose of such vessels, ensuring solid investment returns.

Strategies

Opportunistic and sector-agnostic vessel acquisition strategy. Shipping markets are divided into various key sectors including the dry bulk, tanker, gas and container markets, with each of them further segregated into sub-sectors. Our aim is to exploit opportunities in any sector and sub-sector that provides an attractive demand and supply profile as well as a positive market outlook in the medium to long-term by acquiring vessels trading on this sector. The decision to enter a new sector is based on robust fundamentals and thoughtful analysis of factors affecting both the demand side and the supply side, while the selection of the target vessel is subject to strict qualitative criteria including the environmental performance and energy efficiency of the acquisition candidates.

Expand our fleet through accretive acquisitions. We intend to grow our current fleet through timely and selective acquisitions of additional vessels at attractive valuations. In evaluating acquisitions, we consider and analyze, among other things, our expectation of fundamental developments in the shipping industry, the level of liquidity in the resale and charter market, the vessel condition and technical specifications, the expected remaining useful life, as well as the overall strategic positioning of our fleet and customers. For vessels acquired with charters attached, we also consider the credit quality of the charterer and the duration and terms of the contracts in place. Based on our management team’s successful track record, commercial expertise and reputation in the marketplace as well as our transparent and public corporate structure, we believe that we are well-positioned to source off-market opportunities to acquire secondhand vessels. As a result, we may be able to acquire vessels on more favorable terms than what would be obtained without access to such opportunities.

Access to attractive chartering opportunities. Our senior management in combination with Fidelity, Seanergy’s commercial manager, has established strong relationships with international miners, charterers and brokers. We believe that these relationships should provide us with access to attractive chartering opportunities. Furthermore, we aim to maintain our fleet at a level that meets or exceeds stringent industry standards as we believe that owning a high quality and well-maintained fleet provides us with a competitive advantage in securing favorable employment.

Environmental, Social, Governance, or ESG, Practices: We actively manage a broad range of ESG initiatives, taking into consideration their expected impact on the sustainability of our business over time, and the potential impact of our business on society and the environment. From an environmental perspective, we have adopted advanced voyage optimization platforms and artificial intelligence-assisted remote performance monitoring systems to reduce fuel consumption and enhance operational efficiency. Across the fleet, we have installed Energy Saving Devices (ESDs), such as Variable Frequency Drives (VFDs), and implemented hydrodynamic improvements including Pre-Swirl Stators, Rudder Bulbs, and low-friction hull coatings. To further optimize hull performance, we are piloting high-efficiency silicone hull and propeller coatings supported by Computational Fluid Dynamics (CFD) simulations and hull roughness assessments. In parallel, we have conducted biofuel trials as part of our ongoing assessment of the technical and economic feasibility of alternative marine fuels. All vessels are equipped with Ballast Water Treatment Systems, in accordance with the International Convention for the Control and Management of Ships' Ballast Water and Sediments (BWM Convention). In addition, we have invested in vessels that are fully compliant with the Existing Vessel Design Index (EVDI) requirements, aligned with the IMO’s Energy Efficiency Design Index (EEDI) framework under MARPOL Annex VI. These initiatives demonstrate our ongoing commitment to investing in practical, performance-based solutions that support regulatory compliance and emissions reduction across our fleet. Additionally, we prioritize the well-being of our workforce through measures such as comprehensive training   programs, and robust health benefits. As we anticipate future challenges and opportunities, we are committed to proactively manage both operational and ESG-related risks. By staying attuned to market dynamics and embracing sustainable practices, we aim to ensure the resilience and longevity of our business in an ever-evolving landscape.

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Management of Our Fleet

Master Management Agreement

We have entered into a master management agreement with Seanergy pursuant to which Seanergy (directly or through the Managers) provides us with or arranges on our behalf (through unrelated third parties) administrative, accounting, finance, commercial management, technical management, brokerage and certain other services. Administrative functions that are being performed by Seanergy include but are not limited to investor relations, back-office, reporting, legal and secretarial services. The master management agreement provides for a fixed administration fee of $325 per vessel per day payable to Seanergy. The initial term of the master management agreement expired on December 31, 2024 and was automatically extended for an additional 12-month period. The master management agreement may be terminated immediately only for cause and at any time by either party with three months’ prior notice, and no termination fee will be payable.

Commercial Management

Effective April 1, 2023, United Management Corp. (“United Management”), a wholly-owned subsidiary of the Company, has entered into a services agreement with the Company’s vessel-owning subsidiaries (the “SPVs”) for acting as agent of the SPVs in relation to the vessels’ commercial management services. Pursuant to the services agreement, the SPVs pay to United Management a fee equal to 1.25% of the collected gross freight, demurrage and charter hire for the employment of the vessels, which may be increased to 2% in cases where United Management appoints Fidelity to act solely as the chartering broker.

United Management has sub-contracted certain commercial management services, including postfixture, commercial operation, sale and purchase and bareboat chartering to Seanergy Management. Pursuant to this agreement, each SPV pays to Seanergy Management a commission fee equal to 0.75% of the collected gross hire, freight/ and demurrage and a fee equal to 1% of the contract price of any vessel bought, sold or bareboat chartered by Seanergy Management on United Management’s behalf, except for any vessels bought, sold or bareboat chartered from or to Seanergy, or in respect of any vessel sale relating to a sale and leaseback transaction.

In addition, United Management has entered into a commercial management agreement with Fidelity for, among others, the chartering of our vessels. Pursuant to this agreement, the Company pays to Fidelity a monthly retained fee of $5,000 and each SPV pays to Fidelity a commission fee equal to 0.5% of the collected gross hire, freight and demurrage, which may be increased to 1.25%, in cases where there is no other ship brokerage firm involved in the negotiations, charterparty drafting and final agreement in respect of the employment of the vessels.

Technical Management

We have entered into technical management agreements with Seanergy Shipmanagement for the M/V Goodship, M/V Gloriuship, M/V Synthesea, M/V Chrisea, M/V Nisea and M/V Cretansea. Seanergy Shipmanagement is responsible for arranging, inter alia, the day-to-day operations, inspections, maintenance, repairs, drydocking, purchasing, insurance and claims handling. The technical management agreements with Seanergy Shipmanagement provide for a fixed monthly management fee of $14,000 per vessel. In 2024, we were paying to Seanergy Shipmanagement a fixed monthly management fee of $14,000 per vessel for the M/V Gloriuship, M/V Chrisea, M/V Nisea and M/V Cretansea. In relation to M/V Synthesea, we are paying to Seanergy Shipmanagement a fixed monthly fee of $14,000 from January 2025. In relation to the M/V Goodship, we were paying to Seanergy Shipmanagement a fixed management fee of $10,000 up until March 17 2024. In relation to the M/V Oasea, we were paying to Seanergy Shipmanagement a fixed management fee of $14,000 up until July 19, 2024.

Furthermore, we have appointed V. Ships as the technical managers of the M/Vs Tradership and Exelixsea. V. Ships’ services are provided at a fixed monthly management fee of $10,000 per vessel. In 2024, we were paying to V.Ships fixed management fees of $10,000 for these vessels.

With respect to crewing services, we have also entered into crew management agreements with Global Seaways S.A. for the M/Vs Chrisea, Synthesea, Cretansea and Gloriuship at a monthly rate of $90 per crew member or around $2,200 per vessel. In addition, since March 18, 2024 and September 10, 2024 V.Ships Greece provides crew management services to the M/Vs Goodship and Nisea, respectively, for a monthly fee of $2,200.

Our vessels or additional vessels that we may acquire in the future may be managed by the Managers or by other unaffiliated management companies, including Fidelity, V. Ships and Global Seaways. These third-party managers will be supervised by the Managers.

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Employment of Our Fleet

As of the date of this annual report, the majority of our vessels are employed under time charters, with charter hire calculated at an index-linked rate based on the BCI and the BPI, respectively. In addition, one of our Capesize vessels is currently employed in the spot market, and one of our Kamsarmax vessels is employed under a fixed rate time charter. A time charter is generally a contract to provide a ship for a predefined period to the charterer for an agreed daily rate, which can be fixed or index-linked. Spot charter agreements are charter hires, where a contract is made in the spot market for the use of a vessel for a specific voyage at a specified charter rate per ton of cargo. Fluctuations derive from imbalances in the availability of cargoes for shipment and the number of vessels available at any given time to transport these cargoes. Vessels operating in the time charter market ensure that there will be employment on the vessel for the defined period, while the index-linked hire rate may enable us to capture increased profit margins during periods of improvements in vessel charter rates. Vessels operating in the spot charter market generate revenues that are less predictable, but can yield increased profit margins during periods of improvements in rates. Spot charters also expose vessel owners to the risk of declining rates and rising fuel costs in case of voyage charters.

The Dry Bulk Shipping Industry

The global dry bulk vessel fleet is divided into four categories based on a vessel’s carrying capacity. These categories are:

Capesize. Capesize vessels have a carrying capacity exceeding 100,000 dwt. A sub-sector of the Capesize category is the Newcastlemax. Only the largest ports around the world possess the infrastructure to accommodate vessels of this size. Capesize vessels are primarily used to transport iron ore or coal and, to a much lesser extent, grains, primarily on long-haul routes.

Panamax/Kamsarmax. Panamax vessels have a carrying capacity of between 60,000 and 100,000 dwt. These vessels are designed to meet the physical restrictions of the Panama Canal locks (hence their name “Panamax” — the largest vessels able to transit the Panama Canal prior to its 2016 expansion, making them more versatile than larger vessels). Subsector of Panamax category is the Kamsarmax segment, a design with maximum LOA (length overall) of about 229 meters that can enter Kamsar Port in the Republic of Guinea. The DWT capacity of Kamsarmax vessels is about 82,000 dwt. These vessels carry coal, grains, and, to a lesser extent, minerals such as bauxite/alumina and phosphate rock.

Handymax/Supramax. Handymax vessels have a carrying capacity of between 30,000 and 60,000 dwt. These vessels operate on a large number of geographically dispersed global trade routes, carrying primarily grains and minor bulks. The standard vessels are usually built with 25-30 ton cargo gear, enabling them to discharge cargo where grabs are required (particularly industrial minerals), and to conduct cargo operations in countries and ports with limited infrastructure. This type of vessel offers good trading flexibility and can, therefore, be used in a wide variety of bulk and neobulk trades, such as steel products. Supramax are a sub-category of this category typically having a cargo carrying capacity of between 50,000 and 60,000 dwt.

Handysize. Handysize vessels have a carrying capacity of up to 30,000 dwt. These vessels almost exclusively carry minor bulk cargo. Increasingly, vessels of this type operate on regional trading routes, and may serve as trans-shipment feeders for larger vessels. Handysize vessels are well suited for small ports with length and draft restrictions. Their cargo gear enables them to service ports lacking the infrastructure for cargo loading and discharging.

The supply of dry bulk vessels is dependent on the delivery of new vessels and the removal of vessels from the global fleet, either through scrapping or loss. The level of scrapping activity is generally a function of scrapping prices in relation to current and prospective charter market conditions, as well as operating, repair and survey costs.

The demand for dry bulk vessel capacity is determined by the underlying demand for commodities transported in dry bulk vessels, which in turn is influenced by trends in the global economy. Demand for dry bulk vessel capacity is also affected by the operating efficiency of the global fleet, with port congestion, which has been a feature of the market since 2004, absorbing tonnage and therefore leading to a tighter balance between supply and demand. In evaluating demand factors for dry bulk vessel capacity, we believe that dry bulk vessels can be the most versatile element of the global shipping fleets in terms of employment alternatives.

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Charter Hire Rates

Charter hire rates fluctuate by varying degrees among dry bulk vessel size categories. The volume and pattern of trade in a small number of commodities (major bulks) affect demand for larger vessels. Therefore, charter rates and vessel values of larger vessels often show greater volatility. Conversely, trade in a greater number of commodities (minor bulks) drives demand for smaller dry bulk vessels. Accordingly, charter rates and vessel values for those vessels are subject to less volatility.

Charter hire rates paid for dry bulk vessels are primarily a function of the underlying balance between vessel supply and demand, although at times other factors may play a role. Furthermore, the pattern seen in charter rates is broadly mirrored across the different charter types and the different dry bulk vessel categories. However, because demand for larger dry bulk vessels is affected by the volume and pattern of trade in a relatively small number of commodities, charter hire rates (and vessel values) of larger ships tend to be more volatile than those for smaller vessels.

In the time charter market, rates vary depending on the length of the charter period and vessel specific factors such as age, speed and fuel consumption.

In the voyage charter market, rates are influenced by cargo size, commodity, port dues and canal transit fees, as well as commencement and termination regions. In general, a larger cargo size is quoted at a lower rate per ton than a smaller cargo size. Routes with costly ports or canals generally command higher rates than routes with low port dues and no canals to transit. Voyages with a load port within a region that includes ports where vessels usually discharge cargo or a discharge port within a region with ports where vessels load cargo also are generally quoted at lower rates, because such voyages generally increase vessel utilization by reducing the unloaded portion (or ballast leg) that is included in the calculation of the return charter to a loading area.

In pool arrangements, vessels are pooled together with a group of other similar vessels for economies of scale and the earnings are pooled and distributed to the vessel owners according to a prearranged agreement. Vessels in pool arrangements can be employed in either the time charter market or the spot charter market.

Within the dry bulk shipping industry, the charter hire rate references most likely to be monitored are the freight rate indices issued by the Baltic Exchange. These references are based on actual charter hire rates under charters entered into by market participants as well as daily assessments provided to the Baltic Exchange by a panel of major shipbrokers.

Vessel Prices

The prices of dry bulk vessels continued their increasing course that started in 2021 through the first half of 2022 benefiting from the increased ton-mile following Russia’s invasion in Ukraine, however this trend reversed in the second half of the year as a result of the decreased demand due to the fears of a recession in the global economy and extensive Covid-19 related lockdowns in China. In the first half of 2023, the prices of dry bulk vessels stabilized and gradually started to increase following China’s decision to rescind its zero-Covid policy and some signs of slowing inflation due to the coordinated action of central banks. However, in the second half, prices lost some momentum given the increased effective vessel supply and the slower than anticipated freight market recovery. Price declines were observed until the fourth quarter of 2023 when values rebounded once again on the back of stronger demand and soaring freight rates. In 2024, dry bulk vessel prices followed a significant upswing due to resilient ton-mile demand, limited effective supply of vessels and modest orderbook, before experiencing a drop in middle of 2024. In 2025 to date, dry bulk vessel prices  have seen some downward corrections due to seasonal slow demand during the first two months of the year. However, this trend has started to reverse as of March 2025.

Competition

We operate in markets that are highly competitive and based primarily on supply and demand. We compete for charters on the basis of price, vessel location, size, age and condition of the vessel, as well as on its reputation. Our commercial manager negotiates the terms of our charters (whether voyage charters, period time charters, bareboat charters or pools) based on market conditions. We currently compete primarily with other owners of dry bulk vessels, many of which may have more resources than us and may operate vessels that are newer, and therefore more attractive to charterers than vessels we may operate. Ownership of dry bulk vessels is highly fragmented and is divided among publicly listed companies, state-controlled companies and independent vessel owners.

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Customers

Our customers include regional and international companies. For the period from January 1, 2022 through July 5, 2022, one charterer of the United Maritime Predecessor accounted for 100% of the Predecessor’s revenues. During 2022, for the period from commencement of our vessels’ operations (July 6, 2022), five of our charterers accounted for 94% of our revenues. During 2023, five of our charterers accounted for 77% of our revenues. During 2024, three of our charterers accounted for 68% of our revenues.

Seasonality

Coal, iron ore and grains, which are the major bulks of the dry bulk shipping industry, are somewhat seasonal in nature. The energy markets primarily affect the demand for coal, with increases during hot summer periods when air conditioning and refrigeration require more electricity and towards the end of the calendar year in anticipation of the forthcoming winter period. The demand for iron ore tends to decline in the summer months because many of the major steel users, such as automobile makers, reduce their level of production significantly during the summer holidays. Grain trades are seasonal as they are driven by the harvest within a climate zone. Because three of the five largest grain producers (the United States of America, Canada and the European Union) are located in the northern hemisphere and the other two (Argentina and Australia) are located in the southern hemisphere, harvests occur throughout the year and grains transportation requires dry bulk shipping accordingly.

Environmental and Other Regulations

Government regulation and laws significantly affect the ownership and operation of our fleet. We are subject to international conventions and treaties, national, state and local laws and regulations in force in the countries in which our vessels may operate or are registered relating to safety and health and environmental protection including the storage, handling, emission, transportation and discharge of hazardous and non-hazardous materials, and the remediation of contamination and liability for damage to natural resources. Compliance with such laws, regulations and other requirements entails significant expense, including vessel modifications and implementation of certain operating procedures.

A variety of government and private entities subject our vessels to both scheduled and unscheduled inspections. These entities include the local port authorities (applicable national authorities such as the United States Coast Guard, or USCG, harbor master or equivalent), classification societies, flag state administrations (countries of registry), terminal operators and charterers. Certain of these entities require us to obtain permits, licenses, certificates and other authorizations for the operation of our vessels. Failure to maintain necessary permits or approvals could require us to incur substantial costs or result in the temporary suspension of the operation of one or more of our vessels.

Increasing environmental concerns have created a demand for vessels that conform to stricter environmental standards. We are required to maintain operating standards for our vessels that emphasize operational safety, quality maintenance, continuous training of our officers and crews and compliance with United States and international regulations. We believe that the operation of our vessels is in substantial compliance with applicable environmental laws and regulations and that our vessels have all material permits, licenses, certificates or other authorizations necessary for the conduct of our operations. However, because such laws and regulations frequently change and may impose increasingly stricter requirements, we cannot predict the ultimate cost of complying with these requirements, or the impact of these requirements on the resale value or useful lives of our vessels. In addition, a future serious marine incident that causes significant adverse environmental impact could result in additional legislation or regulation that could negatively affect our profitability.

International Maritime Organization

The IMO, the United Nations agency for maritime safety and the prevention of pollution by vessels, has adopted the International Convention for the Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978 relating thereto, collectively referred to as MARPOL 73/78 and herein as MARPOL, the International Convention for the Safety of Life at Sea of 1974, or SOLAS Convention, the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, or STCW, and the International Convention on Load Lines of 1966, or LL Convention. MARPOL establishes environmental standards relating to oil leakage or spilling, garbage management, sewage, air emissions, the handling and disposal of noxious liquids and the handling of harmful substances in packaged forms. MARPOL is applicable to dry bulk, tanker and LNG carriers, among other vessels, and is broken into six Annexes, each of which regulates a different source of pollution. Annex I relates to oil leakage or spilling; Annexes II and III relate to harmful substances carried in bulk in liquid or in packaged form, respectively; Annexes IV and V relate to sewage and garbage management, respectively; and Annex VI, lastly, relates to air emissions. Annex VI was separately adopted by the IMO in September of 1997.

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In 2013, the IMO’s Marine Environmental Protection Committee, or the MEPC, adopted a resolution amending MARPOL Annex I Condition Assessment Scheme, or CAS. These amendments became effective on October 1, 2014 and require compliance with the 2011 International Code on the Enhanced Programme of Inspections during Surveys of Bulk Carriers and Oil Tankers, or ESP Code, which provides for enhanced inspection programs. On July 1, 2024, amendments to the ESP Code became effective, addressing inconsistencies on examination of ballast tanks at annual surveys for bulk carriers and oil tankers. We may need to make certain financial expenditures to comply with these amendments.

Air Emissions

In September of 1997, the IMO adopted Annex VI to MARPOL to address air pollution from vessels. Effective May 2005, Annex VI sets limits on sulfur oxide and nitrogen oxide emissions from all commercial vessel exhausts and prohibits “deliberate emissions” of ozone depleting substances (such as halons and chlorofluorocarbons), emissions of volatile compounds from cargo tanks, and the shipboard incineration of specific substances. Annex VI also includes a global cap on the sulfur content of fuel oil and allows for special areas to be established with more stringent controls on sulfur emissions, as explained below. Emissions of “volatile organic compounds” from certain vessels, and the shipboard incineration (from incinerators installed after January 1, 2000) of certain substances (such as polychlorinated biphenyls, or PCBs) are also prohibited. We believe that our vessels are currently compliant in all material respects with these regulations.

The MEPC adopted amendments to Annex VI regarding emissions of sulfur oxide, nitrogen oxide, particulate matter and ozone depleting substances, which entered into force on July 1, 2010. The amended Annex VI seeks to further reduce air pollution by, among other things, implementing a progressive reduction of the amount of sulfur contained in any fuel oil used on board ships. Effective January 1, 2020, there has been a global limit of 0.5% m/m sulfur oxide emissions (reduced from 3.50%). This limitation can be met by using low-sulfur compliant fuel oil, alternative fuels, or certain exhaust gas cleaning systems. Ships are required to obtain bunker delivery notes and International Air Pollution Prevention, or IAPP, Certificates from their flag states that specify sulfur content. Additionally, at MEPC 73, amendments to Annex VI to prohibit the carriage of bunkers above 0.5% sulfur on ships became effective on March 1, 2020. Additional amendments to Annex VI revising, among other terms, the definition of “Sulphur content of fuel oil” and “low-flashpoint fuel” and pertaining to the sampling and testing of onboard fuel oil, became effective in April 2022. Additional amendments to Annex VI, requiring bunker delivery notes to include a flashpoint of fuel oil or a statement that the flashpoint has been measured at or above 70°C as mandatory information, became effective May 1, 2024. These regulations subject ocean-going vessels to stringent emissions controls and may cause us to incur substantial costs.

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

Sulfur content standards are even stricter within certain “Emission Control Areas,” or ECAs. As of January 1, 2015, ships operating within an ECA were not permitted to use fuel with sulfur content in excess of 0.1%. Amended Annex VI establishes procedures for designating new ECAs. Currently, the IMO has designated four ECAs, including specified portions of the Baltic Sea area, North Sea area, North American area and United States Caribbean Sea area. At the MEPC 78, the IMO approved a proposal for a new ECA in the Mediterranean Sea as a whole to apply from July 1, 2025 such that the sulfur content of marine fuels does not exceed 0.1%. MEPC 82 adopted additional amendments to Annex VI designating the Canadian Arctic and the Norwegian Sea as ECAs, which will become effective on March 1, 2026. Ocean-going vessels in these areas are subject to stringent emission controls and may cause us to incur additional costs. If other ECAs are approved by the IMO, or other new or more stringent requirements relating to emissions from marine diesel engines or port operations by vessels are adopted by the U.S. Environmental Protection Agency, or EPA, or the states where we operate, compliance with these regulations could entail significant capital expenditures or otherwise increase the costs of our operations.

MEPC 79 adopted amendments to Annex VI on the reporting of mandatory values related to the implementation of the IMO short-term GHG reduction measure, including attained EEXI, CII and rating values to the IMO DCS, became effective May 1, 2024. MEPC 80 adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships with enhanced targets to mitigate harmful emissions. The revised IMO GHG Strategy comprises a common ambition to ensure an uptake of alternative zero and near-zero GHG fuels by 2030 and to achieve net-zero emissions from international shipping by 2050. In March 2024, MEPC 81 agreed on a draft outline of an ‘IMO net-zero framework’ for cutting GHG emissions from international shipping, which lists regulations under MARPOL to be adopted or amended to allow a new global pricing mechanism for maritime GHG emissions. At the conclusion of MEPC 82, a draft legal text was used as a basis for ongoing talks about mid-term GHG reduction measures, which are expected to be adopted in 2025. The proposed mid-term measures include a goal-based marine fuel standard, phasing in the mandatory use of fuels with less GHG intensity, and a global GHG emission pricing mechanism.

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Amended Annex VI also established new tiers of stringent nitrogen oxide emissions standards for marine diesel engines, depending on their date of installation. Now Annex VI provides for a three-tier reduction in NOx emissions from marine diesel engines, with the final tier (or Tier III) to apply to engines installed on vessels constructed on or after January 1, 2016 and which operate in the North American ECA or the U.S. Caribbean Sea ECA as well as ECAs designated in the future by the IMO. At MEPC 70 and MEPC 71, the MEPC approved the North Sea and Baltic Sea as ECAs for nitrogen oxide for ships built after January 1, 2021. The EPA promulgated equivalent (and in some senses stricter) emissions standards in late 2009. Additionally, amendments to Annex II, which strengthen discharge requirements for cargo residues and tank washings in specified sea areas (including North West European waters, Baltic Sea area, Western European waters and Norwegian Sea), came into effect in January 2021.

Regulation 22A of MARPOL Annex VI became effective as of March 1, 2018 and requires ships above 5,000 gross tonnage to collect and report annual data on fuel oil consumption to an IMO database, with the first year of data collection commencing on January 1, 2019. The IMO used such data as the first step in its roadmap (through 2023) for developing its strategy to reduce greenhouse gas emissions from ships, as discussed further below. Amendments to Annex VI requiring bunker delivery notes to include a flashpoint of fuel oil or a statement that the flashpoint has been measured at or above 70°C as mandatory information, became effective May 1, 2024.

MARPOL mandates certain measures relating to energy efficiency for ships. All ships are now required to develop and implement Ship Energy Efficiency Management Plans, or SEEMPS, and new ships must be designed in compliance with minimum energy efficiency levels per capacity mile as defined by the Energy Efficiency Design Index, or EEDI. Under these measures, by 2025, all new ships built will be 30% more energy efficient than those built in 2014.

We may incur costs to comply with these revised standards. Additional or new conventions, laws and regulations, including those from states of the United States, may be adopted that could require the installation of expensive emission control systems and could adversely affect our business, results of operations, cash flows and financial condition.

Safety Management System Requirements

The SOLAS Convention was amended to address the safe manning of vessels and emergency training drills. The Convention of Limitation of Liability for Maritime Claims, or the LLMC, sets limitations of liability for a loss of life or personal injury claim or a property claim against ship owners. We believe that our vessels are in substantial compliance with SOLAS and LLMC standards.

Under Chapter IX of the SOLAS Convention, or the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention, or the ISM Code, our operations are also subject to environmental standards and requirements. The ISM Code requires the party with operational control of a vessel to develop an extensive safety management system that includes, among other things, the adoption of a safety and environmental protection policy setting forth instructions and procedures for operating its vessels safely and describing procedures for responding to emergencies. We rely upon the safety management system that we and our technical management team have developed for compliance with the ISM Code. The failure of a vessel owner or bareboat charterer to comply with the ISM Code may subject such party to increased liability, may decrease available insurance coverage for the affected vessels and may result in a denial of access to, or detention in, certain ports.

Amendments to the SOLAS Convention Chapter VII apply to vessels transporting dangerous goods and require those vessels be in compliance with the International Maritime Dangerous Goods Code, or IMDG Code. Effective January 1, 2018, the IMDG Code includes (1) updates to the provisions for radioactive material, reflecting the latest provisions from the International Atomic Energy Agency, (2) new marking, packing and classification requirements for dangerous goods, and (3) new mandatory training requirements. Amendments to the IMDG Code relating to segregation requirements for certain substances, and classification and transport of carbon, following incidents involving the spontaneous ignition of charcoal, came into effect in June 2022. Updates to the IMDG Code, in line with the updates to the United Nations Recommendations on the Transport of Dangerous Goods, which set the recommendations for all transport modes, became effective January 1, 2024. Effective July 1, 2024, amendments to the International Code on the Enhanced Programme of Inspections during Surveys of Bulk Carriers and Oil Tankers, 2011 became effective, addressing inconsistencies on examination of ballast tanks at annual surveys for bulk carriers and oil tankers.

The ISM Code requires that vessel operators obtain a safety management certificate for each vessel they operate. This certificate evidences compliance by a vessel’s management with the ISM Code requirements for a safety management system. No vessel can obtain a safety management certificate unless its manager has been awarded a document of compliance, issued by each flag state, under the ISM Code.  We have obtained applicable documents of compliance for our offices and safety management certificates for all of our vessels for which the certificates are required by the IMO. The document of compliance and safety management certificate are renewed as required.

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Amendments to SOLAS chapter II-2, intended to prevent the supply of oil fuel not complying SOLAS flashpoint requirements, requiring that ships carrying oil fuel must, prior to bunkering, be provided with a declaration certifying that the oil fuel supplied is in conformity with regulation SOLAS II-2/4.2.1, will enter into effect January 1, 2026.

Regulation II-1/3-10 of the SOLAS Convention governs ship construction and stipulates that ships over 150 meters in length must have adequate strength, integrity, and stability to minimize risk of loss or pollution. Goal-based standards amendments in SOLAS regulation II-1/3-10 entered into force in 2012, and from July 1, 2016 with respect to new oil tankers and bulk carriers. Regulation II-1/3-10 requires that all oil tankers and bulk carriers of 150 meters in length and above, for which the building contract is placed on or after July 1, 2016, satisfy applicable structural requirements conforming to the functional requirements of the International Goal-based Ship Construction Standards for Bulk Carriers and Oil Tankers, or GBS Standards.

The IMO has also adopted the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, or STCW. As of February 2017, all seafarers are required to meet the STCW standards and be in possession of a valid STCW certificate. Flag states that have ratified SOLAS and STCW generally employ the classification societies, which have incorporated SOLAS and STCW requirements into their class rules, to undertake surveys to confirm compliance.

Actions by the IMO’s Maritime Safety Committee and United States agencies indicate that cybersecurity regulations for the maritime industry are likely to be further developed in the near future in an attempt to combat cybersecurity threats. For example, effective January 2021, cyber-risk management systems must be incorporated by shipowners and managers. This might cause companies to create additional procedures for monitoring cybersecurity, which could require additional expenses and/or capital expenditures. The impact of such regulations is hard to predict at this time.

Pollution Control and Liability Requirements

The IMO has negotiated international conventions that impose liability for pollution in international waters and the territorial waters of the signatories to such conventions. For example, the IMO adopted the International Convention for the Control and Management of Ships’ Ballast Water and Sediments, or the BWM Convention, in 2004. The BWM Convention entered into force globally on September 9, 2017. The BWM Convention requires ships to manage their ballast water to remove, render harmless, or avoid the uptake or discharge of new or invasive aquatic organisms and pathogens within ballast water and sediments. The BWM Convention’s implementing regulations call for a phased introduction of mandatory ballast water exchange requirements, to be replaced in time with mandatory concentration limits, and require all ships to carry a ballast water record book and an international ballast water management certificate.

Specifically, ships over 400 gross tons generally must comply with a “D-1 standard,” requiring the exchange of ballast water only in open seas and away from coastal waters. The “D-2 standard” specifies the maximum amount of viable organisms allowed to be discharged, and compliance dates vary depending on the IOPP renewal dates. For most ships, compliance with the D-2 standard will involve installing on-board systems to treat ballast water and eliminate unwanted organisms. Ballast Water Management systems (or BWMS), which include systems that make use of chemical, biocides, organisms or biological mechanisms, or which alter the chemical or physical characteristics of the Ballast Water, must be approved in accordance with IMO Guidelines (Regulation D-3). Pursuant to the BWM Convention amendments that entered into force in October 2019, BWMS installed on or after October 28, 2020 shall be approved in accordance with BWMS Code, while BWMS installed before October 23, 2020 must be approved taking into account guidelines developed by the IMO or the BWMS Code. Costs of compliance with these regulations may be substantial. The cost of compliance could increase for ocean carriers and may have a material effect on our operations. However, many countries already regulate the discharge of ballast water carried by vessels from country to country to prevent the introduction of invasive and harmful species via such discharges. The U.S., for example, requires vessels entering its waters from another country to conduct mid-ocean ballast exchange, or undertake some alternate measure, and to comply with certain reporting requirements. Amendments to the BWM Convention concerning commissioning testing of BWMS became effective in June 2022. Additional amendments to the BWM Convention, concerning the form of the Ballast Water Record Book, entered into force on February 1, 2025.

The IMO also adopted the International Convention on Civil Liability for Bunker Oil Pollution Damage, or the Bunker Convention, to impose strict liability on ship owners (including the registered owner, bareboat charterer, manager or operator) for pollution damage in jurisdictional waters of ratifying states caused by discharges of bunker fuel. The Bunker Convention requires registered owners of ships over 1,000 gross tons to maintain insurance for pollution damage in an amount equal to the limits of liability under the applicable national or international limitation regime (but not exceeding the amount calculated in accordance with the LLMC). With respect to non-ratifying states, liability for spills or releases of oil carried as fuel in ship’s bunkers typically is determined by the national or other domestic laws in the jurisdiction where the events or damages occur.

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Ships are required to maintain a certificate attesting that they maintain adequate insurance to cover an incident. In jurisdictions such as the United States where the Bunker Convention has not been adopted, various legislative schemes or common law govern, and liability is imposed either on the basis of fault or on a strict-liability basis.

Anti-Fouling Requirements

In 2001, the IMO adopted the International Convention on the Control of Harmful Anti-fouling Systems on Ships, or the “Anti-fouling Convention” which entered into force in September 2008, and prohibits the use of organotin compound coatings to prevent the attachment of mollusks and other sea life to the hulls of vessels. Vessels of over 400 gross tons engaged in international voyages will also be required to undergo an initial survey before the vessel is put into service or before an International Anti-fouling System Certificate is issued for the first time; and subsequent surveys when the anti-fouling systems are altered or replaced. In 2023, amendments to the Anti-fouling Convention came into effect which include controls on the biocide cybutryne; ships shall not apply or re-apply anti-fouling systems containing this substance from January 1, 2023. We have obtained Anti-fouling System Certificates for our vessels that are subject to the Anti-fouling Convention.

Compliance Enforcement

Noncompliance with the ISM Code or other IMO regulations may subject the ship owner or bareboat charterer to increased liability, may lead to decreases in available insurance coverage for affected vessels and may result in the denial of access to, or detention in, some ports. The USCG and European Union authorities have indicated that vessels not in compliance with the ISM Code by applicable deadlines will be prohibited from trading in U.S. and European Union ports, respectively. As of the date of this annual report, each of our vessels is ISM Code certified. However, there can be no assurance that such certificates will be maintained in the future. The IMO continues to review and introduce new regulations. It is impossible to predict what additional regulations, if any, may be passed by the IMO and what effect, if any, such regulations might have on our operations.

United States Regulations

Newly elected President Donald Trump has signed a number of executive orders and directives that are likely to have an impact on U.S. regulations. For example, a regulatory freeze was issued, which permits the withdrawal of rules sent to be published and authorizes those in charge of federal agencies to delay for 60 days the effective date of rules that have been published but are not yet effective. This regulatory freeze impacts U.S. EPA decisions and proposed amendments. Additionally federal agencies have placed employees on leave as a result of an executive order regarding diversity, equity and inclusion programs, which may impact implementation and enforcement of regulations. This and additional executive orders could impact regulatory requirements.

The U.S. Oil Pollution Act of 1990 and the Comprehensive Environmental Response, Compensation and Liability Act

The U.S. Oil Pollution Act of 1990, or OPA, established an extensive regulatory and liability regime for the protection and clean-up of the environment from oil spills. OPA affects all “owners and operators” whose vessels trade or operate within the U.S., its territories and possessions or whose vessels operate in U.S. waters, which includes the U.S.’s territorial sea and its 200 nautical mile exclusive economic zone around the U.S. The U.S. has also enacted the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, which applies to the discharge of hazardous substances other than oil, except in limited circumstances, whether on land or at sea. OPA and CERCLA both define “owner and operator” in the case of a vessel as any person owning, operating or chartering by demise, the vessel. Both OPA and CERCLA impact our operations.

Under OPA, vessel owners and operators are “responsible parties” and are jointly, severally and strictly liable (unless the spill results solely from the act or omission of a third-party, an act of God or an act of war) for all containment and clean-up costs and other damages arising from discharges or threatened discharges of oil from their vessels, including bunkers (fuel). OPA defines these other damages broadly to include:


 (i)
injury to, destruction or loss of, or loss of use of, natural resources and related assessment costs;


(ii)
injury to, or economic losses resulting from, the destruction of real and personal property;


(iii)
loss of subsistence use of natural resources that are injured, destroyed or lost;


(iv)
net loss of taxes, royalties, rents, fees or net profit revenues resulting from injury, destruction or loss of real or personal property, or natural resources;


(v)
lost profits or impairment of earning capacity due to injury, destruction or loss of real or personal property or natural resources; and


(vi)
net cost of increased or additional public services necessitated by removal activities following a discharge of oil, such as protection from fire, safety or health hazards, and loss of subsistence use of natural resources.

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OPA contains statutory caps on liability and damages; such caps do not apply to direct clean-up costs. Effective March 2023, the USCG adjusted the limits of OPA liability for non-tank vessels, edible oil tank vessels, and any oil spill response vessels, to the greater of $1,300 per gross ton or $1,076,000 (subject to periodic adjustment for inflation). These limits of liability do not apply if an incident was proximately caused by the violation of an applicable U.S. federal safety, construction or operating regulation by a responsible party (or its agent, employee or a person acting pursuant to a contractual relationship), or a responsible party’s gross negligence or willful misconduct. The limitation on liability similarly does not apply if the responsible party fails or refuses to (i) report the incident where the responsible party knows or has reason to know of the incident; (ii) reasonably cooperate and assist as requested in connection with oil removal activities; or (iii) without sufficient cause, comply with an order issued under the Federal Water Pollution Act (Section 311 (c), (e)) or the Intervention on the High Seas Act.

CERCLA contains a similar liability regime whereby owners and operators of vessels are liable for clean-up, removal and remedial costs, as well as damages for injury to, or destruction or loss of, natural resources, including the reasonable costs associated with assessing the same, and health assessments or health effects studies. There is no liability if the discharge of a hazardous substance results solely from the act or omission of a third-party, an act of God or an act of war. Liability under CERCLA is limited to the greater of $300 per gross ton or $5.0 million for vessels carrying a hazardous substance as cargo and the greater of $300 per gross ton or $500,000 for any other vessel. These limits do not apply (rendering the responsible person liable for the total cost of response and damages) if the release or threat of release of a hazardous substance resulted from willful misconduct or negligence, or the primary cause of the release was a violation of applicable safety, construction or operating standards or regulations. The limitation on liability also does not apply if the responsible person fails or refused to provide all reasonable cooperation and assistance as requested in connection with response activities where the vessel is subject to OPA.

OPA and CERCLA each preserve the right to recover damages under existing law, including maritime tort law. OPA and CERCLA both require owners and operators of vessels to establish and maintain with the USCG evidence of financial responsibility sufficient to meet the maximum amount of liability to which the particular responsible person may be subject. Vessel owners and operators may satisfy their financial responsibility obligations by providing a proof of insurance, a surety bond, qualification as a self-insurer or a guarantee. We comply and plan to comply going forward with the USCG’s financial responsibility regulations by providing applicable certificates of financial responsibility.

The 2010 Deepwater Horizon oil spill in the Gulf of Mexico resulted in additional regulatory initiatives or statutes, including higher liability caps under OPA, new regulations regarding offshore oil and gas drilling, and a pilot inspection program for offshore facilities. However, several of these initiatives and regulations have been or may be revised. For example, the U.S. Bureau of Safety and Environmental Enforcement’s, or BSEE, revised Production Safety Systems Rule, or PSSR, effective December 27, 2018, modified and relaxed certain environmental and safety protections under the 2016 PSSR. Additionally, in August 2023 the BSEE released a final Well Control Rule, which strengthens testing and performance requirements, and may affect offshore drilling operations. Compliance with any new requirements of OPA and other environmental laws, and future legislation or regulations applicable to the operation of our vessels could negatively impact the cost of our operations and adversely affect our business.

OPA specifically permits individual states to impose their own liability regimes with regard to oil pollution incidents occurring within their boundaries, provided they accept, at a minimum, the levels of liability established under OPA and some states have enacted legislation providing for unlimited liability for oil spills. Many U.S. states that border a navigable waterway have enacted environmental pollution laws that impose strict liability on a person for removal costs and damages resulting from a discharge of oil or a release of a hazardous substance. These laws may be more stringent than U.S. federal law. Moreover, some states have enacted legislation providing for unlimited liability for discharge of pollutants within their waters, although in some cases, states which have enacted this type of legislation have not yet issued implementing regulations defining vessel owners’ responsibilities under these laws. The Company intends to comply with all applicable state regulations in the ports where the Company’s vessels call.

We currently maintain pollution liability coverage insurance in the amount of $1 billion per incident for each of our vessels. If the damages from a catastrophic spill were to exceed our insurance coverage, that could have an adverse effect on our business and results of operation.

Other United States Environmental Initiatives

The U.S. Clean Air Act of 1970 (including its amendments of 1977 and 1990), or CAA, requires the EPA to promulgate standards applicable to emissions of volatile organic compounds and other air contaminants. The CAA requires states to adopt State Implementation Plans, or SIPs, some of which regulate emissions resulting from vessel loading and unloading operations which may affect our vessels.

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The U.S. Clean Water Act, or CWA, prohibits the discharge of oil, hazardous substances and ballast water in U.S. navigable waters unless authorized by a duly issued permit or exemption, and imposes strict liability in the form of penalties for any unauthorized discharges. The CWA also imposes substantial liability for the costs of removal, remediation and damages and complements the remedies available under OPA and CERCLA. In 2015, the EPA expanded the definition of “waters of the United States,” or WOTUS, thereby expanding federal authority under the CWA. On December 30, 2022, the EPA and U.S. Army Corps of Engineers announced the final revised WOTUS rule, which was published on January 18, 2023. In August 2023, the EPA and Department of the Army issued a final rule to amend the revised WOTUS definition to conform the definition of WOTUS to the U.S. Supreme Court’s interpretation of the Clean Water Act in its decision dated May 25, 2023. The final rule became effective September 8, 2023 and operates to limit the Clean Water Act.

The EPA and the USCG have also enacted rules relating to ballast water discharge, compliance with which requires the installation of equipment on our vessels to treat ballast water before it is discharged or the implementation of other port facility disposal arrangements or procedures at potentially substantial costs, and/or otherwise restrict our vessels from entering U.S. Waters. The EPA will regulate these ballast water discharges and other discharges incidental to the normal operation of certain vessels within United States waters pursuant to the Vessel Incidental Discharge Act, or VIDA, which was signed into law on December 4, 2018 and requires that the U.S. Coast Guard develop implementation, compliance, and enforcement regulations regarding ballast water. It intends to replace the VGP scheme and streamline the patchwork of federal, state, and local requirements for the commercial vessel community. The US Environmental Protection Agency, or EPA, has indicated that new federal discharge standards for vessels may be published in autumn 2024. In the meantime, the agency has seemingly strengthened its inspection and enforcement efforts to ensure compliance with the extended VGP scheme and warns that non-compliance can result in significant penalties. The VIDA gave the EPA two years to develop new national discharge standards for vessels and the U.S. Coast Guard another two years to develop regulations and best management practices to implement and enforce those standards. VIDA also specifies that the provisions of the VGP will continue to apply until EPA and the U.S. Coast Guard publish their final regulations, regardless of how long that takes, and that the permit cannot be modified during that time. On October 26, 2020, the EPA published a Notice of Proposed rulemaking for Vessel Incidental Discharge National Standards of Performance under VIDA, and in November 2020, held virtual public meetings. On October 18, 2023, the EPA published a Supplemental Notice to the Vessel Incidental Discharge National Standards of Performance, which shares new ballast water information that the EPA received from the USCG.

On September 20, 2024, the EPA finalized national standards of performance for non-recreational vessels 79-feet in length and longer with respect to incidental discharges and on October 9, 2024, these Vessel Incidental Discharge National Standards of Performance were published. Within two years of publication, the USCG is required to develop corresponding implementation regulations. Until such regulations are final, effective, and enforceable, vessels will continue to be subject to the VGP 2013 requirements and USCG ballast water regulations, including USCG technology for all vessels equipped with ballast water tanks bound for U.S. ports or entering U.S. waters. Several U.S. states have added specific requirements to the Vessel General Permit and, in some cases, may require vessels to install ballast water treatment technology to meet biological performance standards. In addition, several U.S. states have added specific requirements to the VGP, including submission of a Notice of Intent, or NOI, or retention of a PARI form and submission of annual reports. Any upcoming rule changes may have a financial impact on our vessels and may result in our vessels being banned from calling in the U.S. in case compliance issues arise.

European Union Regulations

In October 2009, the European Union amended a directive to impose criminal sanctions for illicit ship-source discharges of polluting substances, including minor discharges, if committed with intent, recklessly or with serious negligence and the discharges individually or in the aggregate result in deterioration of the quality of water. Aiding and abetting the discharge of a polluting substance may also lead to criminal penalties. The directive applies to all types of vessels, irrespective of their flag, but certain exceptions apply to warships or where human safety or that of the ship is in danger. Criminal liability for pollution may result in substantial penalties or fines and increased civil liability claims. Regulation (EU) 2015/757 of the European Parliament and of the Council of April 29, 2015 (amended by Regulation (EU) 2016/2071 with respect to methods of calculating, inter alia, emission and consumption) governs the monitoring, reporting and verification of carbon dioxide emissions from maritime transport, and, subject to some exclusions, requires companies with ships over 5,000 gross tonnage to monitor and report carbon dioxide emissions annually, which may cause us to incur additional expenses. As of January 2019, large ships calling at EU ports have been required to collect and publish data on carbon dioxide emissions and other information. The system entered into force on March 1, 2018. July 2020 saw the European Parliament’s Committee on Environment, Public Health and Food Safety vote in favor of the inclusion of vessels of 5,000 gross tons and above in the EU Emissions Trading System (in addition to voting for a revision to the monitoring, reporting and verification of CO2 emissions). In September 2020, the European Parliament adopted the proposal from the European Commission to amend the regulation on monitoring carbon dioxide emissions from maritime transport.

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On July 14, 2021, the European Commission published a package of draft proposals as part of its ‘Fit for 55’ environmental legislative agenda and as part of the wider EU Green Deal growth strategy (the “Proposals”). There are two key initiatives relevant to maritime arising from the Proposals: (a) a bespoke emissions trading scheme for the maritime sector (ETS) which commenced in 2024 and which applies to all ships above a gross tonnage of 5,000; and (b) a FuelEU draft regulation which seeks to require all ships above a gross tonnage of 5,000 to carry on board a ‘FuelEU certificate of compliance’ from June 30, 2025 as evidence of compliance with the limits on the greenhouse gas intensity of the energy used on-board by a ship and with the requirements on the use of on-shore power supply (OPS) at berth. ETS was agreed in December 2022 and FuelEU was passed into law on July 25, 2023 and entered into force on January 1, 2025. More specifically, ETS is to apply gradually over the period from 2024 to 2026. In 2025 shipping companies would have to surrender 40% of ETS allowances for 2024 emissions; in 2026 shipping companies would have to surrender 70% of ETS allowances for the 2025 emissions and 100% in 2027 for 2026 emissions. The cap under the ETS would be set by taking into account EU MRV system emissions data for the years 2018 and 2019, adjusted, from year 2021 and is to capture 100% of the emissions from intra-EU maritime voyages; 100% of emissions from ships at berth in EU ports; and 50% of emissions from voyages which start or end at EU ports (but the other destination is outside the EU). More recent proposed amendments signal that 100% of non-EU emissions may be caught if the IMO does not introduce a global market-based measure by 2028. All maritime allowances will be auctioned and there will be no free allocation for the shipping sector. From a risk management perspective, new systems, including, personnel, data management systems, costs recovery mechanisms, revised service agreement terms and emissions reporting procedures will have to be put in place, at significant cost, to prepare for and manage the administrative aspect of ETS compliance.

Additionally, on July 25, 2023, the European Council of the European Union adopted the FuelEU under the FuelEU Initiative of its “Fit-for-55” package which sets limitations on the acceptable yearly greenhouse gas intensity of the energy used by covered vessels. Among other things, the Maritime Fuel Regulation requires that greenhouse gas intensity of fuel used by covered vessels is reduced by 2% starting January 1, 2025, with additional reductions contemplated every five years (up to 80% by 2050). Shipping companies may enter into pooling mechanisms with other shipping companies in order to achieve compliance, bank surplus emissions and borrow compliance balances from future years.  A FuelEU Document of Compliance is required to be kept on board a vessel to show compliance by June 30, 2026. Both the ETS and FuelEU schemes have significant impacts on the management of the vessels calling to EU ports, by increasing the complexity and monitoring of, and costs associated with the operation of vessels and affecting the relationships with our time charterers.

Responsible recycling and scrapping of ships are becoming increasingly important issues for shipowners and charterers alike as the industry strives to replace old ships with cleaner, more energy efficient models. The recognition of the need to impose recycling obligations on the shipping industry is not new. In 2009, the IMO oversaw the creation of the Hong Kong Ship Recycling Convention (the “Hong Kong Convention”), which sets standards for ship recycling. Concerned at the lack of progress in satisfying the conditions needed to bring the Hong Kong Convention into force, the EU published its own Ship Recycling Regulation 1257/2013 (SRR) in 2013, with a view to facilitating early ratification of the Hong Kong Convention both within the EU and in other countries outside the EU. The 2013 regulations are vital to responsible ship recycling in the EU. SRR requires that, from 31 December 2020, all existing ships sailing under the flag of EU member states and non-EU flagged ships calling at an EU port or anchorage must carry on-board an Inventory of Hazardous Materials (IHM) with a certificate or statement of compliance, as appropriate. For EU-flagged vessels, a certificate (either an Inventory Certificate or Ready for Recycling Certificate) will be necessary, while non-EU flagged vessels will need a Statement of Compliance. Now that the Hong Kong Convention has been ratified and will enter into force on June 26, 2025, it is expected the EU Ship Recycling Regulation will be reviewed in light of this.

The European Union has adopted several regulations and directives requiring, among other things, more frequent inspections of high-risk ships, as determined by type, age, and flag as well as the number of times the ship has been detained. The European Union also adopted and extended a ban on substandard ships and enacted a minimum ban period and a definitive ban for repeated offenses. The regulation also provided the European Union with greater authority and control over classification societies, by imposing more requirements on classification societies and providing for fines or penalty payments for organizations that failed to comply. Furthermore, the EU has implemented regulations requiring vessels to use reduced sulfur content fuel for their main and auxiliary engines. Since January 1, 2015, vessels have been required to burn fuel with sulfur content not exceeding 0.1% while within EU member states’ territorial seas, exclusive economic zones and pollution control zones that are included in “SOx Emission Control Areas.” EU Directive (EU) 2016/802 establishes limits on the maximum sulfur content of gas oils and heavy fuel oil and contains fuel-specific requirements for ships calling at EU ports.

EU Directive 2004/35/CE (as amended) regarding the prevention and remedying of environmental damage addresses liability for environmental damage (including damage to water, land, protected species and habitats) on the basis of the “polluter pays” principle. Operators whose activities caused the environmental damage are liable for the damage (subject to certain exceptions). With regard to specified activities causing environmental damage, operators are strictly liable. The directive applies where damage has already occurred and where there is an imminent threat of damage. The directive requires preventative and remedial actions, and that operators report environmental damage or an imminent threat of such damage.

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International Labor Organization

The International Labor Organization, or the ILO, is a specialized agency of the UN that has adopted the Maritime Labor Convention 2006, or MLC 2006. A Maritime Labor Certificate and a Declaration of Maritime Labor Compliance is required to ensure compliance with the MLC 2006 for all ships above 500 gross tons in international trade. We believe that our vessels are in substantial compliance with and are certified to meet MLC 2006.

Greenhouse Gas Regulation

Currently, the emissions of greenhouse gases from international shipping are not subject to the Kyoto Protocol to the United Nations Framework Convention on Climate Change (this task having been delegated to the IMO), which entered into force in 2005 and pursuant to which adopting countries have been required to implement national programs to reduce greenhouse gas emissions with targets extended through 2020. In December 2009, more than 27 nations, including the U.S. and China, signed the Copenhagen Accord, which includes a non-binding commitment to reduce greenhouse gas emissions. The 2015 United Nations Climate Change Conference in Paris resulted in the Paris Agreement, which entered into force on November 4, 2016 and does not directly limit greenhouse gas emissions from ships. In January 2025, President Trump signed an executive order to start the process of withdrawing the United States from the Paris Agreement; the withdrawal will take at least one year to complete.

At MEPC 70 and MEPC 71, a draft outline of the structure of the initial strategy for developing a comprehensive IMO strategy on reduction of greenhouse gas emissions from ships was approved. In accordance with this roadmap, and as detailed above, pursuant to MPC 80, in July 2023, IMO adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships, which identifies a number of “levels of ambition”, including (1) decreasing the carbon intensity from ships through the implementation of further phases of EEDI for new ships; (2) reducing carbon dioxide emissions per transport work, as an average across international shipping, by at least 40% by 2030, and (3) pursuing net-zero GHG emission by or around 2050. These regulations could cause us to incur additional substantial expenses.

At MEPC 70 in October 2016, a mandatory data collection system (DCS) was adopted which requires ships above 5,000 gross tons to report consumption data for fuel oil, hours under way and distance travelled. Unlike the EU MRV (see below), the IMO DCS covers any maritime activity carried out by ships, including dredging, pipeline laying, ice-breaking, fish-catching and off-shore installations. The SEEMPs of all ships covered by the IMO DCS must include a description of the methodology for data collection and reporting. After each calendar year, the aggregated data are reported to the flag state. If the data have been reported in accordance with the requirements, the flag state issues a statement of compliance to the ship. Flag states subsequently transfer this data to an IMO ship fuel oil consumption database, which is part of the Global Integrated Shipping Information System (GISIS) platform. IMO will then produce annual reports, summarizing the data collected. Thus, currently, data related to the GHG emissions of ships above 5,000 gross tons calling at ports in the European Economic Area (EEA) must be reported in two separate, but largely overlapping, systems: the EU MRV – which applies since 2018 – and the IMO DCS – which applies since 2019. The proposed revision of Regulation (EU) 2015/757 adopted on 4 February 2019 aims to align and facilitate the simultaneous implementation of the two systems however it is still not clear when the proposal will be adopted.

IMO’s MEPC 76 adopted amendments to MAPROL Annex VI that will require ships to reduce their greenhouse gas emissions. Effective from January 1, 2023, the Revised MARPOL Annex VI includes carbon intensity measures (requirements for ships to calculate their Energy Efficiency Existing Ship Index (EEXI) following technical means to improve their energy efficiency and to establish their annual operational carbon intensity indicator and rating). MEPC 76 also adopted guidelines to support implementation of the amendments.

MEPC 79 adopted amendments to Annex VI on the reporting of mandatory values related to the implementation of the IMO short-term GHG reduction measure, including attained EEXI, CII and rating values to the IMO DCS, which became effective May 1, 2024. MEPC 80 adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships with enhanced targets to mitigate harmful emissions. The revised IMO GHG Strategy comprises a common ambition to ensure an uptake of alternative zero and near-zero GHG fuels by 2030 and to achieve net-zero emissions from international shipping by 2050. At the conclusion of MEPC 82, a draft legal text was used as a basis for ongoing discussions about mid-term GHG reduction measures, which are expected to be adopted in 2025. The proposed mid-term measures include a goal-based marine fuel standard, phasing in the mandatory use of fuels with less GHG intensity, and a global GHG emission pricing mechanism.

In 2021, the EU adopted a European Climate Law (Regulation (EU) 2021/1119), establishing the aim of reaching net zero greenhouse gas emissions in the EU by 2050, with an intermediate target of reducing greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels. In July 2021, the European Commission launched the Fit for 55 (described above) to support the climate policy agenda. As of January 2019, large ships calling at EU ports have been required to collect and publish data on carbon dioxide emissions and other information.

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In the United States, the EPA issued a finding that greenhouse gases endanger the public health and safety, adopted regulations to limit greenhouse gas emissions from certain mobile sources, and proposed regulations to limit greenhouse gas emissions from large stationary sources. The EPA or individual U.S. states could enact environmental regulations that could negatively affect our operations. On November 2, 2021, the EPA issued a proposed rule under the CAA designed to reduce methane emissions from oil and gas sources. In November 2022, the EPA issued a supplemental proposal that would achieve more comprehensive emissions reductions and add proposed requirements for sources not previously covered. The EPA held a public hearing in January 2023 on the proposal and, in December 2023, the EPA announced a final rule to reduce methane and other air pollutants from the oil and natural gas industry, which was published on March 8, 2024. The rule includes “Emissions Guidelines” for states to follow as they develop plans to limit methane emissions from existing sources.

Any passage of climate control legislation or other regulatory initiatives by the IMO, the EU, the U.S. or other countries where we operate, or any treaty adopted at the international level to succeed the Kyoto Protocol or Paris Agreement, that restricts emissions of greenhouse gases could require us to make significant expenditures which we cannot predict with certainty at this time. Even in the absence of climate control legislation, our business may be indirectly affected to the extent that climate change may result in sea level changes or certain weather events.

Vessel Security Regulations

Since the terrorist attacks of September 11, 2001 in the United States, there have been a variety of initiatives intended to enhance vessel security such as the U.S. Maritime Transportation Security Act of 2002, or MTSA. To implement certain portions of the MTSA, the USCG issued regulations requiring the implementation of certain security requirements aboard vessels operating in waters subject to the jurisdiction of the United States and at certain ports and facilities, some of which are regulated by the EPA.

Similarly, Chapter XI-2 of the SOLAS Convention imposes detailed security obligations on vessels and port authorities and mandates compliance with the International Ship and Port Facilities Security Code, or the ISPS Code. The ISPS Code is designed to enhance the security of ports and ships against terrorism. To trade internationally, a vessel must attain an International Ship Security Certificate, or ISSC, from a recognized security organization approved by the vessel’s flag state. Ships operating without a valid certificate may be detained, expelled from, or refused entry at port until they obtain an ISSC. The various requirements, some of which are found in the SOLAS Convention, include, for example, on-board installation of automatic identification systems to provide a means for the automatic transmission of safety-related information from among similarly equipped ships and shore stations, including information on a ship’s identity, position, course, speed and navigational status; on-board installation of ship security alert systems, which do not sound on the vessel but only alert the authorities on shore; the development of vessel security plans; ship identification number to be permanently marked on a vessel’s hull; a continuous synopsis record kept onboard showing a vessel’s history including the name of the ship, the state whose flag the ship is entitled to fly, the date on which the ship was registered with that state, the ship’s identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address; and compliance with flag state security certification requirements.

The USCG regulations, intended to align with international maritime security standards, exempt non-U.S. vessels from MTSA vessel security measures, provided such vessels have on board a valid ISSC that attests to the vessel’s compliance with the SOLAS Convention security requirements and the ISPS Code. Future security measures could have a significant negative financial impact on us. We intend to comply with the various security measures addressed by MTSA, the SOLAS Convention and the ISPS Code.

The cost of vessel security measures has also been affected by the escalation in the frequency of acts of piracy against ships, notably off the coast of Somalia, including the Gulf of Aden and Arabian Sea area. Substantial loss of revenue and other costs may be incurred as a result of detention of a vessel or additional security measures, and the risk of uninsured losses could significantly and negatively affect our business. Costs may be incurred in taking additional security measures in accordance with Best Management Practices to Deter Piracy, notably those contained in the BMP5 industry standard.

European mandatory non-financial reporting regulations

On November 10, 2022, the EU Parliament adopted the Corporate Sustainability Reporting Directive (“CSRD”). EU member states have 18 months from July 6, 2024, to integrate it into national law. The CSRD will create new, detailed sustainability reporting requirements and will significantly expand the number of EU and non-EU companies subject to the EU sustainability reporting framework. The required disclosures will go beyond environmental and climate change reporting to include social and governance matters (for example, respect for employee and human rights, anti-corruption and bribery, corporate governance and diversity and inclusion). In addition, it will require disclosure regarding the due diligence processes implemented by a company in relation to sustainability matters and the actual and potential adverse sustainability impacts of an in-scope company’s operations and value chain. The CSRD will begin to apply on a phased basis starting from financial year 2024 through to 2028, applicable to large EU and non-EU undertakings with substantial presence in the EU, subject to certain financial and employee thresholds being met. New systems, including personnel, data management systems and reporting procedures will have to be put in place, at significant cost, to prepare for and manage the administrative aspect of CSRD compliance. We note that following the publication of the Omnibus package of proposals on February 26, 2025 which are designed to simplify EU regulations and cut red tape, the application of all reporting requirements in the CSRD for companies that are due to report in 2026 and 2027 is postponed to 2028. If implemented into law, the Omnibus package will simplify compliance for SMEs and all companies with up to 1,000 employees and 50 million turnover will be outside the scope of the CSRD. For the companies in scope (above 1,000 employees and 50 million turnover), the Commission will adopt a delegated act to revise and simplify the existing sustainability reporting standards (ESRS). The proposed provisions in CSRD also create a derogation for companies with more than 1,000 employees and a turnover below EUR 450 million by making the reporting of Taxonomy voluntary, and also, put a stronger emphasis on transition finance by introducing the option of reporting on partial Taxonomy-alignment.

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Inspection by Classification Societies

The hull and machinery of every commercial vessel must be classed by a classification society authorized by its country of registry. The classification society certifies that a vessel is safe and seaworthy in accordance with the applicable rules and regulations of the country of registry of the vessel and SOLAS. Most insurance underwriters make it a condition for insurance coverage and lending that a vessel be certified “in class” by a classification society which is a member of the International Association of Classification Societies, the IACS. The IACS has adopted harmonized Common Structural Rules, or the Rules, which apply to oil tankers and bulk carriers constructed on or after July 1, 2015. The Rules attempt to create a level of consistency between IACS Societies. All of our vessels are certified as being “in class” by all the applicable Classification Societies (e.g., American Bureau of Shipping, DNV, Lloyd’s Register of Shipping, Bureau Veritas, NKK).

A vessel must undergo annual surveys, intermediate surveys, drydockings and special surveys. In lieu of a special survey, a vessel’s machinery may be on a continuous survey cycle, under which the machinery would be surveyed periodically over a five-year period. Every vessel above 15 years of age is also required to be drydocked every 30 to 36 months for inspection of the underwater parts of the vessel. If any vessel does not maintain its class and/or fails any annual survey, intermediate survey, drydocking or special survey, the vessel will be unable to carry cargo between ports and will be unemployable and uninsurable which could cause us to be in violation of certain covenants in our loan agreements. Any such inability to carry cargo or be employed, or any such violation of covenants, could have a material adverse impact on our financial condition and results of operations.

Risk of Loss and Liability Insurance

General

The operation of any cargo vessel includes risks such as mechanical failure, physical damage, collision, property loss, cargo loss or damage and business interruption due to political circumstances in foreign countries, piracy incidents, hostilities and labor strikes. In addition, there is always an inherent possibility of marine disaster, including oil spills and other environmental incidents, and the liabilities arising from owning and operating vessels in international trade. OPA, which imposes virtually unlimited liability upon shipowners, operators and bareboat charterers of any vessel trading in the exclusive economic zone of the United States for certain oil pollution accidents in the United States, has made liability insurance more expensive for shipowners and operators trading in the United States market. We carry insurance coverage as customary in the shipping industry. However, not all risks can be insured, specific claims may be rejected and we might not be always able to obtain adequate insurance coverage at reasonable rates.

Hull & Machinery and War Risks Insurances

We maintain marine hull and machinery and war risks insurances, which include the risk of actual or constructive total loss, for our vessel. Each of our vessels is covered up to at least its fair market value with deductibles ranging between $125,000 and $150,000 per incident. We also maintain increased value coverage for our vessels. Under this increased value coverage, in the event of total loss of a vessel, we will be able to recover the sum insured under the increased value policy in addition to the sum insured under the hull and machinery policy. Increased value insurance also covers excess liabilities which are not recoverable under our hull and machinery policy by reason of under insurance.

Protection and Indemnity Insurance

Protection and indemnity insurance, provided by mutual protection and indemnity associations, or P&I Associations, covers our third-party liabilities in connection with our shipping activities. This includes related expenses of injury, illness or death of crew, passengers and other third parties, loss or damage to cargo, claims arising from collisions with other vessels, damage to other third-party property such as fixed and floating objects, pollution arising from oil or other substances, salvage, towing and other related costs, including wreck removal. Protection and indemnity insurance is a form of mutual indemnity insurance, extended by protection and indemnity mutual associations, or “clubs.”

Our coverage limit is as per the International Group’s rules, where there are standard sub-limits for oil pollution at $1 billion, passenger liability at $2 billion and seamen liabilities at $3 billion. The 12 P&I Associations that comprise the International Group insure approximately 90% of the world’s commercial tonnage and have entered into a pooling agreement to reinsure each association’s liabilities in excess of each association’s own retention of $10.0 million up to, currently, approximately $8.9 billion. As a member of P&I Associations, which is a member of the International Group, we are subject to calls payable to the associations based on our claim records as well as the claim records of all other members of the individual associations and members of the shipping pool of P&I Associations comprising the International Group.

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Permits and Authorizations

We are required by various governmental and quasi-governmental agencies to obtain certain permits, licenses and certificates with respect to our vessels. The kinds of permits, licenses and certificates required depend upon several factors, including the commodity transported, the waters in which the vessel operates, the nationality of the vessel’s crew and the age of a vessel. We believe that we have obtained all permits, licenses and certificates currently required to permit our vessels to operate as planned. Additional laws and regulations, environmental or otherwise, may be adopted which could limit our ability to do business or increase the cost of us doing business in the future.

C.
Organizational Structure

We are a Marshall Islands corporation. Our significant wholly owned subsidiaries as of December 31, 2024 are listed in Exhibit 8.1 to this annual report on Form 20-F.

D.
Property, Plants and Equipment

We do not own any real estate property. We maintain our principal executive offices at 154 Vouliagmenis Avenue, 166 74 Glyfada, Greece. Other than our vessels, we do not have any material property. See “Item 4.B. Business Overview - Our Current Fleet.”

ITEM 4A.
UNRESOLVED STAFF COMMENTS

None.

ITEM 5.
OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion of the results of our operations and our financial condition should be read in conjunction with the financial statements and the notes to those statements included in “Item 18. Financial Statements.” We were incorporated under the laws of the Republic of the Marshall Islands on January 20, 2022 and did not commence operations until the consummation of the Spin-Off on July 5, 2022. For periods from January 1, 2022 up to July 5, 2022, the accompanying financial statements reflect the financial position and results of the carve-out operations of United Maritime Predecessor. For period from January 20, 2022 up to December 31, 2022 and for the years ended December 31, 2023 and December 31, 2024, the accompanying financial statements reflect the financial position and results of United Maritime Corporation and of its consolidated subsidiaries.

This discussion contains forward-looking statements that involve risks, uncertainties, and assumptions. Actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth in “Item 3. Key Information–D. Risk Factors.”

A.
Results of operations

Principal Factors Affecting Our Business

The principal factors that affect our financial position, results of operations and cash flows include the following:


 •
number of vessels owned and operated;


•
voyage charter rates;


•
time charter trip rates;


•
period time charter rates;


•
the nature and duration of our voyage charters;


•
vessels repositioning;


•
vessel operating expenses and direct voyage costs;


•
maintenance and upgrade work;


•
the age, condition and specifications of our vessels;


•
issuance of our common shares and other securities;


•
amount of debt obligations; and


•
financing costs related to debt obligations.

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We are also affected by the types of charters we enter into. Vessels operating on period time charters and bareboat time charters provide more predictable cash flows, but can yield lower profit margins than vessels operating in the spot charter market, either on trip time charters or voyage charters, during periods characterized by favorable market conditions.

Vessels operating in the spot charter market or on index-linked time charters generate revenues that are less predictable, but can yield increased profit margins during periods of improvements in dry bulk rates. Spot charters also expose vessel-owners to the risk of declining dry bulk rates and rising fuel costs in case of voyage charters.

Critical Accounting Policies

Critical accounting policies are those that are both most important to the portrayal of the company’s financial condition and results, and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. We have described in Item 5. Operating and Financial Review and Prospects – E. Critical Accounting Estimates our critical accounting policies, because they potentially result in material different results under different assumptions and conditions. For a description of all our significant accounting policies, see Note 2 to our annual audited financial statements included in this annual report.

Results of Operations

Year ended December 31, 2024 as compared to year ended December 31, 2023

(In thousands of U.S. Dollars, except for share and per share data)
              
Change
  
   
Year ended December
31, 2024
    
Year ended December
31, 2023
    
Amount
    
%
  
Revenues:
                        
Vessel revenue, net
    
45,439
      
36,067
      
9,372
      
26
%
                                 
Expenses:
                                
Voyage expenses
    
(1,771
)
    
(3,107
)
    
1,336
      
(43
)%
Vessel operating expenses
    
(19,745
)
    
(20,338
)
    
593
      
(3
)%
Management fees-related party
    
(1,741
)
    
(1,421
)
    
(320
)
    
23
%
Management fees
    
(522
)
    
(545
)
    
23
      
(4
)%
General and administration expenses
    
(4,010
)
    
(6,018
)
    
2,008
      
(33
)%
Depreciation and amortization
    
(13,430
)
    
(9,363
)
    
(4,067
)
    
43
%
Impairment loss
    
(828
)
    
-
      
(828
)
    
-
  
Gain on sale of vessel, net
    
1,426
      
11,804
      
(10,378
)
    
(88
)%
Operating income
    
4,818
      
7,079
      
(2,261
)
    
(32
)%
Other income / (expenses), net:
                                
Interest and finance costs
    
(8,416
)
    
(7,183
)
    
(1,233
)
    
17
%
Loss on extinguishment of debt
    
(397
)
    
(85
)
    
(312
)
    
367
%
Interest income
    
314
      
430
      
(116
)
    
(27
)%
Loss on equity method investment
    
(142
)
    
-
      
(142
)
    
-
  
Other income
    
311
      
112
      
199
      
178
%
Other, net
    
129
      
(132
)
    
261
      
(198
)%
Total other expenses, net:
    
(8,201
)
    
(6,858
)
    
(1,343
)
    
20
%
Net (loss) / income
    
(3,383
)
    
221
      
(3,604
)
    
(1,631
)%
Net (loss) / income attributable to common stockholders
    
(3,383
)
    
126
      
(3,257
)
    
(2,585
)%
                                 
Net (loss) / income per common share
                                
Basic and Diluted
    
(0.39
)
    
0.02
                  
Weighted average number of common shares outstanding
                                
Basic and Diluted
    
8,711,951
      
8,359,487
                  

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Vessel Revenue, Net – Vessel revenue, net increased by $9.4 million or 26% in 2024 and is mainly attributable to the increase in the size of our fleet resulting to an increase of operating days from 2,143 days in 2023 to 2,778 days in 2024. This increase was also enhanced by a slight increase in TCE rate in 2024 compared of that of 2023. Please see the reconciliation of TCE rate (a non-GAAP measure) to net revenues from vessels, the most directly comparable U.S. GAAP measure in “Item 5. Operating and Financial Review and Prospects – D. Trend Information – Key Performance Indicators”.

Voyage Expenses – Voyage expenses amounted to $1.8 million in 2024 and $3.1 million in 2023. The decrease is mainly attributed to the 44 operating days that our fleet was chartered in the spot market in 2023 compared to NIL days in 2024, during which such expenses are borne by the owners. The decrease was partially offset by the increased brokerage commission as a result of the increased revenue earned in 2024 as compared to 2023.

Vessel Operating Expenses – Vessel operating expenses amounted to $19.7 million in 2024 and $20.3 million in 2023. The slight decrease is primarily attributable to the decrease in daily operating expenses from $6,861 in 2023 to $6,616 in 2024. The decrease was partially offset by the increase in ownership days from 2,339 ownership days in 2023 to 2,875 ownership days in 2024. Please see the calculation of daily operating expenses (a non-GAAP metric) “Item 5. Operating and Financial Review and Prospects – D. Trend Information – Key Performance Indicators”.

Management Fees – related party – Management fees to related party amounted to $1.7 million in 2024 and $1.4 million in 2023. The increase is related to the increase in ownership days for vessels that were under related parties’ management, from 1,208 days in 2023 to 1,777 days in 2024.

Management Fees – Management fees amounted to $0.5 million in 2024 and $0.5 million in 2023.

General and Administrative Expenses – General and administrative expenses amounted to $4.0 million and $6.0 million in 2024 and 2023, respectively. The decrease is mainly attributable to decreased stock-based compensation, a non-cash item, which was $0.8 million in 2024 for shares granted pursuant to our 2022 Equity Incentive Plan, compared to $2.5 million in 2023.

Depreciation and amortization – Depreciation and amortization amounted to $13.4 million in 2024 and $9.4 million in 2023. The increase is attributable to the increase in ownership days from 2,339 days in 2023 to 2,875 days in 2024, which is partially offset by the decreased depreciation due to the increase in scrap rate which was effective from January 1, 2024. Three additional vessels performed their scheduled drydocking in 2024 resulting to an increased amortization in 2024 compared to 2023.

Impairment loss – Impairment loss amounted to $0.8 million in 2024 and relates to the M/V Gloriuship which was classified as held for sale as of December 31, 2024 and her delivery to the new owners is expected to take place in the third quarter of 2025. No impairment loss was recorded for 2023.

Gain on sale of vessels – The gain of $1.4 million in 2024 is attributable to the sale of the M/V Oasea in July 2024. An aggregate amount of $0.2 million was paid to Seanergy Management for this sale in 2024, representing 1% of the gross sale price. The gain of $11.8 million recorded in 2023 is attributable to the sale of the M/T Epanastasea in August 2023. An aggregate amount of $0.4 million was paid to Seanergy Management for this sale in 2023, representing 1% of the gross sale price.

Interest and Finance Costs, net – Interest and finance cost amounted to $8.4 million in 2024 and $7.2 million in 2023. The increase is attributable to the increase of the weighted average outstanding debt from $58.4 million in 2023 to $70.0 million in 2024.The weighted average interest rate on our outstanding debt was 8.54% and 8.70% for 2024 and 2023, respectively.

Loss on extinguishment of debt – The loss of $0.4 million in 2024 is mainly attributable to the early prepayment of the Neptune Sale and Leaseback associated with the vessel sale in July 2024. The loss in 2023 is attributable to the loss of $0.03 million following the repayment of the July 2022 EnTrust Facility and a loss of $0.06 million following the repayment of the August 2022 EnTrust Facility.

Interest income- Interest income amounted to $0.3 million in 2024 and $0.4 million in 2023 related to our short-term time deposits.

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Loss on equity method investment- Loss on equity method investment of $0.1 million in 2024 represents our share of results in the ECV project through our investment in RGI Marine Holdings S.A.

Other Income – Other income amounted to $0.3 million in 2024 and $0.1 million in 2023. The increase is attributed to the insurance credits in respect with vessels’ insurances.

Please see Item 5.A of our Form 20-F filed with the Commission on April 2, 2024 for a discussion of the year-to-year comparison between 2023 and 2022.

Implications of Being an Emerging Growth Company

We had less than $1.235 billion in revenue during our last fiscal year, which means that we qualify as an “emerging growth company” as defined in the JOBS Act. An emerging growth company may take advantage or specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:


 •
exemption from the auditor attestation requirement in the assessment of the emerging growth company’s internal controls over financial reporting under Section 404(b) of Sarbanes-Oxley; and


•
exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and financial statements.

We may take advantage of these provisions until the end of the fiscal year following the fifth anniversary of our initial public offering or such earlier time that we are no longer an emerging growth company. We will cease to be an emerging growth company if, among other things, we have more than $1.235 billion in “total annual gross revenues” during the most recently completed fiscal year. We may choose to take advantage of some, but not all, of these reduced burdens. For as long as we take advantage of the reduced reporting obligations, the information that we provide shareholders may be different from information provided by other public companies. We are choosing to “opt out” of the extended transition period relating to the exemption from new or revised financial accounting standards and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth public companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

B.
Liquidity and Capital Resources

As of December 31, 2024, we did not have any contractual obligations other than the loan agreements, finance leases, other financial liabilities, capital expenditures for vessels acquisitions described below and the remaining capital commitments of Euro 4.4 million related to the ECV project. In January 2025, we distributed $0.7 million as a quarterly cash dividend to our common shareholders. On March 17, 2025, we declared a cash dividend of $0.01 per share for the fourth quarter of 2024. The quarterly dividend was paid on April 10, 2025 to all shareholders of record as of March 27, 2025.

On March 6, 2024, we entered into a bareboat charter agreement for an 82,235 dwt Kamsarmax dry bulk carrier built in 2016 in Japan, which was renamed Nisea and was delivered to the Company in September 2024. The vessel is chartered-in under an 18-month bareboat charter agreement, with a down payment of $7.5 million (already paid), at a daily charter rate of $8,000 over the period of the bareboat charter. We also have the option to purchase the vessel at the end of the bareboat charter period for a purchase price of $16.6 million. We made a down payment in the amount of $3.75 million upon the signing of the agreement and a further down payment of $3.75 million was payable prior to the expected date of delivery of the vessel. In aggregate, the acquisition cost for the vessel, assuming exercise of the purchase option, will be approximately $28.4 million.

We will require capital to fund ongoing operations and capital expenditures for our vessels’ scheduled surveys, vessel improvements to meet new regulations, for any future vessel acquisitions and to pay dividends.

Our principal source of funds has been our operating cash inflows, long-term borrowings from banks, sale and leaseback transactions, vessels sales and equity provided by the capital markets. Our principal use of funds has primarily been capital expenditures to establish our fleet, maintain the quality of our vessels, comply with international shipping standards and environmental laws and regulations, fund working capital requirements, dividend payments and make principal repayments and interest payments on our outstanding debt obligations, finance leases and other financial liabilities. As of the date of this annual report, our cash flow projections indicate that cash on hand and cash to be provided by operating activities, financing activities and investing activities or a combination of any of those (i.e. debt agreements, vessel sales, sale and leaseback activities and finance leases) will be sufficient to meet our obligations and cover the liquidity needs that become due in the twelve-month period ending one year after the financial statements’ issuance, including obligations arising from purchase options in finance lease agreements and for vessel acquisitions.

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Cash Flows

(In thousands of US Dollars)
            
   
Year ended
December 31, 2024
    
Year ended
December 31, 2023
    
From the date
of inception
(January 20, 2022)
through
December 31, 2022
  
                 
Cash Flow Data:
                  
Net cash provided by / (used in) operating activities
    
3,264
      
(6,228
)
    
7,875
  
Net cash provided by / (used in) investing activities
    
7,949
      
(59,138
)
    
6,488
  
Net cash (used in) / provided by financing activities
    
(18,952
)
    
9,935
      
55,569
  

Year ended December 31, 2024, as compared to year ended December 31, 2023

Cash and cash equivalents and restricted cash, non-current, as of December 31, 2024 were $6.8 million. We consider highly liquid investments such as time deposits and certificates of deposit with an original maturity of around three months or less to be cash equivalents. Cash and cash equivalents are held primarily in U.S. dollars, with minimal amounts held in Euro.

Net Cash from Operating Activities

Net cash provided by operating activities for the year ended December 31, 2024 amounted to $3.3 million. Net cash used in operating activities for the year ended December 31, 2023 amounted to $6.2 million. The increase is primarily attributed to the increased operating days in 2024 compared to 2023 due to the increased size of our fleet which is partially offset by the drydocking costs, as three vessels underwent drydocking in 2024.

Net Cash from Investing Activities

Net cash provided by investing activities for the year ended December 31, 2024 was $7.9 million. The 2024 cash inflows resulted mainly from $20.2 million proceeds from sale of M/V Oasea. The cash inflows were partially offset by $8.3 million lease prepayments and other initial direct costs for finance leased vessels, $3.7 million payments in equity investment and $0.3 million payments on vessels’ improvements. Net cash used in investing activities for the year ended December 31, 2023 was $59.1 million. The 2023 cash outflows resulted mainly from $81.7 million payments for acquisition of vessels and improvements and $14.9 million lease prepayments and other initial direct costs for finance leased vessels. The outflows were partially offset by the $37.5 million proceeds from sale of M/T Epanastasea.

Net Cash from Financing Activities

Net cash used in financing activities for the year ended December 31, 2024 was $19.0 million. The 2024 cash outflows resulted mainly from $33.7 million prepayments of long-term debt and other financial liabilities, $32.1 million payments for finance lease liabilities, $2.6 million dividend payments, $1.6 million payments of financing costs and $0.5 million payments for repurchases of common stock. The outflows were partially offset by $47.1 million proceeds from long term debt and other financial liabilities and $4.4 million relates to amounts due to related party. Net cash provided by financing activities for the year ended December 31, 2023 was $9.9 million. The 2023 cash inflows resulted mainly from $54.5 million proceeds from long term debt and other financial liabilities and $1.9 million proceeds from issuance of shares following warrant exercises. The inflows were partially offset by $31.9 million repayments of long-term debt and other financial liabilities, $9.4 million dividend payments, $2.7 million payments for finance lease liabilities, $1.8 million payments of financing costs and $0.7 million payments for repurchases of common stock.

Please see Item 5.A of our Form 20-F filed with the Commission on April 2, 2024 for a discussion of the year-to-year comparison between 2023 and 2022.

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Loan Arrangements

New Loan Facility during the year ended December 31, 2024

Sinopac Loan Facility

On August 5, 2024, the Company entered a $16.5 million loan facility (the “Sinopac Loan Facility”) with Sinopac Capital International (HK) Limited (“Sinopac”) for the purpose of financing the exercise of the purchase option of the M/V Chrisea under its previous bareboat charter. The facility was drawn on August 19, 2024 and bears interest of term SOFR plus a margin of 2.60% per annum. The term of the facility is five years, and the repayment schedule comprises of 20 quarterly installments of $0.4 million, followed by a balloon installment of $8.5 million payable along with the final installment. An amount of $1.2 million was withheld as a security deposit by Sinopac upon the drawdown of the facility to secure the due liabilities by the Company of its obligations and undertakings as per Sinopac Loan Facility. In addition, the Company is required to maintain a security cover ratio not less than 110% for the first two years and 120% at all times thereafter until the maturity of the loan. As of December 31, 2024, the outstanding amount under this facility was $16.1 million.

Loan Facilities repaid during the years ended December 31, 2024 and December 31, 2023

July 2022 EnTrust Facility

On July 1, 2022, the loan facility entered into between Seanergy and Kroll Agency Services Limited and Kroll Trustee Services Limited as facility agent and security agent, respectively, and certain nominees of EnTrust Global as lenders, for the M/V Gloriuship, was amended for the purposes of replacing Seanergy with the Company as guarantor upon the consummation of the Spin-Off (the “July 2022 Entrust Facility”). All applicable financial covenants were waived with no material changes in the other terms of the loan facility.

On July 28, 2022, the July 2022 EnTrust Facility was amended and restated in order to (i) increase the facility from the total amount outstanding of $4.6 million to $14.0 million, (ii) change the maturity to February 2024, (iii) alter the guarantor of the facility to the Company and (iv) cancel all applicable financial covenants with no material changes in the other terms of the loan facility. The amended and restated July 2022 Entrust Facility was fully drawn on August 1, 2022. In connection with the sale of M/Ts Parosea and Bluesea, the Company prepaid $2.0 million of the July 2022 EnTrust Facility, as agreed with the lenders in November 2022 pursuant to a side letter. The facility bore a fixed interest rate of 7.90% per annum and was repayable through two quarterly installments of $0.5 million and one of $1.0 million falling nine, twelve and fifteen months after the drawdown and a final balloon of $10.0 million payable at maturity. On December 5, 2023, the total amount outstanding under this facility was fully repaid in connection with the entry into the Huarong Sale and Leaseback and all obligations under the facility were irrevocably and unconditionally discharged.

August 2022 EnTrust Facility

In August 2022, the Company entered into a secured loan facility of $63.6 million with Kroll Agency Services Limited and Kroll Trustee Services Limited, as facility agent and security agent, respectively, and certain nominees of EnTrust Global as lenders to partially finance the acquisition of the M/Ts Parosea, Bluesea, Minoansea and Epanastasea at a fixed rate of 7.90% per annum. The facility originally had a term of 18 months after the drawdown of the last tranche and would amortize through three quarterly installments averaging $4.0 million commencing nine months from the drawdown date, followed by a $51.6 million balloon payable at maturity. Following the sale of the M/Ts Parosea and Bluesea, we repaid their respective tranches for an aggregate amount of $32.4 million.

On January 30, 2023, as part of the sale of the M/T Minoansea and the acquisitions of the M/Vs Goodship and Tradership, we entered into a deed of accession, amendment and restatement of the August 2022 EnTrust Facility in order to replace the collateral vessel securing this facility. Under the terms of the amended agreement, the fixed interest rate was amended to 9.00% per annum and the $15.2 million tranche that was previously secured by the M/T Minoansea was replaced by two tranches of $7.0 and $8.2 million, secured by the M/V Goodship and M/V Tradership, respectively.

On August 9, 2023, the Company entered into a deed of accession, amendment and restatement of the August 2022 EnTrust Facility in order to replace the collateral vessel securing this facility. Under the terms of the amended agreement, the $15.0 million tranche was secured by the M/V Exelixsea and bore a fixed rate of 9.00% per annum.

On December 5, 2023, we prepaid the $12.2 million outstanding indebtedness under the two tranches secured by the M/V Goodship and M/V Tradership, using proceeds from the Huarong Sale and Leaseback agreement, described below.

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Following the 2023 amendments, the August 2022 EnTrust Facility was repayable through one installment of $0.5 million on the twelfth month after the original drawdown date, and an installment of $1.5 million on the fifteenth month after the original drawdown date, followed by a balloon installment of $13.0 million payable at maturity. The August 2022 EnTrust Facility was secured by a first priority mortgage and a general assignment covering earnings, insurances and requisition compensation over the M/V Exelixsea, an account pledge agreement concerning the earnings account of the vessel, a shares security agreement concerning the vessel-owning subsidiary’s shares and relevant technical and commercial managers’ undertakings. The facility agreement included certain restrictions on dividends from the borrower’s accounts and other distributions. This facility was fully repaid on March 27, 2024 in connection with the entry into the Village Seven Sale and Leaseback, and all obligations under the facility were irrevocably and unconditionally discharged.

Sale and Leaseback Transactions

New Sale and Leaseback Activities during the year ended December 31, 2024

Village Seven Sale and Leaseback

On February 22, 2024, we entered into a $13.8 million sale and leaseback agreement with Village Seven Co., Ltd and V7 Fune Inc. (collectively, “Village Seven”) in order to refinance the August 2022 EnTrust Facility. On March 27, 2024, the Company sold and chartered back the M/V Exelixsea from Village Seven on a bareboat basis for a period of four years, followed by an additional two-year period at the Company’s option. The charterhire principal is repayable through 48 consecutive monthly installments of $0.2 million paid in advance, which could extend to 72 installments in case of exercise of the two-year optional period. The Company has continuous options to repurchase the vessel at predetermined prices, following the second anniversary of the bareboat charter. At the end of the optional period, the Company has the option to take ownership of the vessel at nominal additional cost. The applicable interest rate is 3-month term SOFR plus 2.65% per annum. The sale and leaseback agreement does not include any financial covenants or security value maintenance provisions.

As of December 31, 2024, the amount outstanding under the Village Seven Sale and Leaseback was $11.9 million.

Onishi Sale and Leaseback

On July 24, 2024, the Company entered into a $18.0 million sale and leaseback agreement with Onishi Kaiun Co. and Ocean West Shipping S.A. for the purpose of financing the purchase option of the M/V Synthesea under its previous bareboat charter. On August 1, 2024, the Company sold and chartered back the M/V Synthesea on a bareboat basis for a period of five years, followed by an additional two-year period at the Company’s option. The financing bears an interest rate of 2.70% plus 3-month term SOFR. The charterhire principal amortizes over a seven-year term, through 84 consecutive monthly installments of approximately $0.1 million. Following the second anniversary of the bareboat charter, the Company has continuous options to repurchase the vessel at predetermined prices as set forth in the agreement. At the end of the optional period, the Company and the lessors have the option to repurchase and to sell the vessel, respectively, for $6.5 million. The sale and leaseback agreement does not include any financial covenants or security value maintenance provisions.

As of December 31, 2024, the amount outstanding under the Onishi Sale and Leaseback was $17.2 million.

Existing Sale and Leaseback Activities

April 2023 Neptune Sale and Leaseback

On April 26, 2023, following the delivery of the M/V Cretansea, we entered into a $12.25 million sale-and-leaseback agreement with a subsidiary of Neptune Maritime Leasing Ltd. (“Neptune”), for the purpose of partly financing the acquisition cost of M/V Cretansea. The Company sold and chartered back the vessel from the Neptune subsidiary under a bareboat charter for a five-year period. The Company has continuous options to purchase the vessel throughout the duration of the charter, while at the end of the five-year bareboat period, it has the obligation to purchase the vessel for $6.4 million. The Company is required to maintain a security cover ratio (as defined in the bareboat charter) of at least 120% for the first twelve months and at least 130% thereafter. In addition, the lessee is required to maintain minimum liquidity of approximately $0.4 million in its operating account. The charterhire principal amortizes in 60 consecutive monthly installments of approximately $0.1 million each along with a purchase obligation of $6.4 million. The applicable interest rate is 3-month term SOFR plus 4.25% per annum.

As of December 31, 2024, the outstanding charterhire principal was $10.3 million.

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Huarong Sale and Leaseback

On November 15, 2023, the Company entered into three identical $10.0 million sale and leaseback transactions with affiliates of China Huarong Shipping Financial Leasing Company Ltd. (“Huarong”) for the purpose of refinancing the outstanding indebtedness of the M/V Gloriuship which was previously financed by the July 2022 EnTrust Facility, and the outstanding indebtedness of the M/Vs Goodship and Tradership which were previously financed by the August 2022 EnTrust Facility. On December 5, 2023, the Company sold and chartered back the vessels from three affiliates of Huarong on a bareboat charter basis for a three-year period. The Company has continuous options to repurchase the vessels throughout the duration of the charters, starting six months after the commencement date, while at the end of each three-year bareboat period, the Company has the obligation to repurchase each vessel for $5.0 million. The sale and leaseback agreements do not include any financial covenants or security value maintenance provisions. The charterhire principal of each sale and leaseback transaction amortizes through 36 monthly installments of approximately $0.1 million and a purchase obligation of $5.0 million at the expiration of each bareboat agreement. The applicable interest rate is 3-month term SOFR plus 3.30% per annum.

As of December 31, 2024, the aggregate charterhire principal was $25.0 million.

Sale and Leaseback Transactions repaid during the year ended December 31, 2024 and December 31, 2023

March 2023 Neptune Sale and Leaseback

On March 31, 2023, following the delivery of M/V Oasea, the Company entered into a $12.25 million sale and leaseback agreement with a subsidiary of Neptune, for the purpose of partly financing the acquisition cost of M/V Oasea. The Company sold and chartered back the vessel from the Neptune subsidiary under a bareboat charter for a five-year period. The Company had continuous options to repurchase the vessel throughout the duration of the charter, while at the end of the five-year bareboat period, it had the obligation to repurchase the vessel for $6.4 million. The Company was required to maintain a security cover ratio (as defined in the bareboat charter) of at least 120% for the first twelve months and at least 130% thereafter. In addition, the lessee was required to maintain minimum liquidity of approximately $0.4 million in its operating account. The charterhire principal was repayable in 60 consecutive monthly installments of approximately $0.1 million each along with a purchase obligation of $6.4 at the expiration of the bareboat charter. The applicable interest rate was 3-month term SOFR plus 4.25% per annum. On July 19, 2024, the Company repurchased the vessel from Neptune, repaying the outstanding charterhire principal of $10.8 million and the relevant prepayment fees, in connection with the sale of the M/V Oasea to her new owners.

C.
Research and development, patents and licenses, etc.

None.

D.
Trend Information

Our results of operations depend primarily on the charter rates earned by our vessels. The widely accepted benchmark of charter market in the dry bulk industry is the Baltic Dry Index, or the BDI. Over the course of 2024, the BDI registered a low of 976 on December 19, 2024 and a high of 2,419 on March 18, 2024.

The historic performance of the BDI has been characterized by high volatility, driven by changes in supply and demand for vessels. Over an extended period of time in recent years, the growth in the size of the dry bulk fleet has outpaced growth in vessel demand.

Specifically, in the period from 2010 to 2024, the size of the fleet in terms of deadweight tons grew by an annual average of about 5.0% while the corresponding growth in demand for dry bulk carriers grew by 3.0%, resulting in a drop of about 50% in the value of the BDI over the period. In 2024, the total size of the dry bulk fleet rose by about 3.0%, compared to demand growth of 4.9%. According to tentative projections, the total size of the dry bulk fleet is expected to rise by about 3.0% in 2025, compared to expected demand growth of 0.7%.

Capesize dry bulk vessels primarily transport iron ore and coal, with bauxite gaining a larger share year by year. Similarly, Panamax and Kamsarmax dry bulk vessels play a crucial role in transporting dry bulk cargo such as coal, grains, and iron ore to a lesser extent. China is a major player in the global iron ore market, importing more than 70% of seaborne iron ore. Australia and Brazil dominate exports, accounting for nearly 80% of global iron ore exports combined. Since 2000, the growth in China's iron ore and coal imports has significantly influenced the dry bulk market, though, this trend has slowed since 2015. On the bauxite front, China's bauxite imports are playing an increasingly vital role in Capesize markets. Infrastructure improvements in West Africa, led by Guinea, are expected to further boost bauxite trade, while, the giant Simandou iron ore project is anticipated to significantly increase iron ore exports from the region.
 
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The significant geopolitical developments, with most notable the recent conflicts in Ukraine and Gaza, along with escalating tariff disputes, have to a certain extent disrupted dry bulk seaborne trade, affecting global shipping routes, freight rates, and maritime security. Further to the direct impact on seaborne trade, these events also affected seaborne trade indirectly through their impact, realized or expected, on economic activity and inflation.
 
Even though the ongoing war in Ukraine, initially had a positive effect on the dry bulk market due to shifts in trade patterns, its long term impact has been marginal. Our operations have not been materially affected, as our vessels do not currently operate in Russian or Ukrainian ports, and our suppliers and service providers have not faced restrictions or disruptions in their activities. We do not anticipate any significant impact in the future. Meanwhile, the 2023 Israel–Hamas war and subsequent missile attacks by the Houthis in the Red Sea have led vessels to divert via the Cape of Good Hope, instead of transiting the Suez Canal. This had a modestly positive impact on the dry bulk market, since the longer route increased fleet utilization and reduced the supply of available ships. While the cease-fire declared on January 15, 2025 eased tensions in region, attacks resumed in March 2025 and the future direction of the conflict remains highly uncertain and may continue to pose a significant safety hazard for vessels transiting the Red Sea. Finally, the implementation of the proposed trade tariffs from the new US administration could pose risks for the dry bulk market. These proposed tariffs target all trade partners to some extent, which could have unpredictable effects on economic activity. Higher import costs and more trade imbalances may affect shipping volumes, routes, and demand patterns, in ways that can potentially impact the dry bulk market. We may need to adjust our operational strategies to navigate these changes.

As a majority of our fleet is employed on index-linked charter contracts, we will be exposed to any near-term volatility in the charter market, to the extent that we have not hedged the index-linked earnings through forward freight agreements. We believe we have structured our capital expenditure requirements, debt commitments and liquidity resources in a way that will provide us with financial flexibility (see “Item 5. Operating and Financial Review and Prospects - B. Liquidity and Capital Resources” for more information).

Important Measures and Definitions for Analyzing Results of Operations

We use a variety of financial and operational terms and concepts. These include the following:

Ownership days. Ownership days are the total number of calendar days in a period during which we owned or chartered in on bareboat basis each vessel in our fleet. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses recorded during that period. Our calculation of Ownership Days may not be comparable to that reported by other companies due to differences in methods of calculation.

Available days. Available days are the number of ownership days less the aggregate number of days that our vessels are off-hire due to major repairs, dry-dockings, lay-up or special or intermediate surveys, which are the repair days. The shipping industry uses available days to measure the aggregate number of days in a period during which vessels are available to generate revenues. Our calculation of Available Days may not be comparable to that reported by other companies due to differences in methods of calculation.

Operating days. Operating days are the number of available days in a period less the aggregate number of days that our vessels are off-hire due to unforeseen circumstances. Operating days include the days that our vessels are in ballast voyages without having fixed their next employment. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels could actually generate revenues. Our calculation of Operating Days may not be comparable to that reported by other companies due to differences in methods of calculation.

Fleet utilization. Fleet utilization is the percentage of time that our vessels were generating revenues and is determined by dividing operating days by ownership days for the relevant period. Fleet Utilization is used to measure a company’s ability to efficiently find suitable employment for its vessels and minimize the number of days that its vessels are off-hire for unforeseen events. We believe it provides additional meaningful information and assists management in making decisions regarding areas where we may be able to improve efficiency and increase revenue and because we believe that it provides useful information to investors regarding the efficiency of our operations.

Off-hire. The period a vessel is not being chartered or is unable to perform the services for which it is required under a charter.

Dry-docking. We periodically dry-dock each of our vessels for inspection, repairs and maintenance and any modifications to comply with industry certification or governmental requirements.

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Time charter. A time charter is a contract for the use of a vessel for a specific period of time (period time charter) or for a specific voyage (trip time charter) during which the charterer pays substantially all of the voyage expenses, including port charges, bunker expenses, canal charges and other commissions. The vessel owner pays the vessel operating expenses, which include crew costs, provisions, deck and engine stores and spares, lubricants, insurance, maintenance and repairs. The vessel owner is also responsible for each vessel’s dry-docking and intermediate and special survey costs. Time charter rates are usually index linked during the term of the charter. Prevailing time charter rates do fluctuate on a seasonal and year-to-year basis and may be substantially higher or lower from a prior time charter agreement when the subject vessel is seeking to renew the time charter agreement with the existing charterer or enter into a new time charter agreement with another charterer. Fluctuations in time charter rates are influenced by changes in spot charter rates.

Bareboat charter. A bareboat charter is generally a contract pursuant to which a vessel owner provides its vessel to a charterer for a fixed period of time at a specified daily rate. Under a bareboat charter, the charterer assumes responsibility for all voyage and vessel operating expenses and risk of operation.

Voyage charter. A voyage charter is generally a contract to carry a specific cargo from a load port to a discharge port for an agreed-upon total amount. Under voyage charters, voyage expenses, such as port charges, bunker expenses, canal charges and other commissions, are paid by the vessel owner, who also pays vessel operating expenses.

TCE. Time charter equivalent, or TCE, rate is defined as our net revenue less voyage expenses during a period divided by the number of our operating days during the period. Voyage expenses include port charges, bunker expenses, canal charges and other commissions.

Daily Vessel Operating Expenses. Daily Vessel Operating Expenses are calculated by dividing vessel operating expenses less pre-delivery expenses by ownership days for the relevant time periods. Vessel operating expenses include crew costs, provisions, deck and engine stores, lubricants, insurance, maintenance and repairs. Vessel operating expenses before pre-delivery expenses exclude one-time pre-delivery and pre-joining expenses associated with initial crew manning and supply of stores of Company’s vessels upon delivery.

Performance Indicators

The figures shown below are non-GAAP statistical ratios used by management to measure performance of our vessels. For the “Fleet Data” figures, there are no comparable U.S. GAAP measures.

   
United Maritime Corporation
  
Fleet Data:
  
Year ended
December 31, 2024
    
Year ended
December 31, 2023
    
For the period from
January 20, 2022
(date of inception)
to December 31, 2022
  
                 
Ownership days
    
2,875
      
2,339
      
614
  
Available days
    
2,787
      
2,200
      
614
  
Operating days
    
2,778
      
2,143
      
610
  
Fleet utilization
    
96.6
%
    
91.6
%
    
99.3
%
                         
Average Daily Results:
                        
TCE rate(1)
  
$
15,719
    
$
15,380
    
$
28,752
  
Daily Vessel Operating Expenses(2)
  
$
6,616
    
$
6,861
    
$
7,265
  

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United Maritime
Predecessor
  
   
For the period from
January 1, 2022
through
July 5, 2022
  
Fleet Data:
      
Ownership days
    
186
  
Available days
    
126
  
Operating days
    
116
  
Fleet utilization
    
62.3
%
         
Average Daily Results:
        
TCE rate(1)
  
$
16,267
  
Daily Vessel Operating Expenses(2)
  
$
5,914
  

(1)
We include TCE rate, a non-GAAP measure, as we believe it provides additional meaningful information in conjunction with net revenues from vessels, the most directly comparable U.S. GAAP measure, because it assists our management in making decisions regarding the deployment and use of our vessels and in evaluating their financial performance. Our calculation of TCE rate may not be comparable to that reported by other companies. The following table reconciles our net revenues from vessel to TCE rate.

(2)
We include Daily Vessel Operating Expenses, a non-GAAP measure, as we believe it provides additional meaningful information in conjunction with vessel operating expenses, the most directly comparable U.S. GAAP measure, because it assists our management in making decisions regarding the deployment and use of our vessels and in evaluating their financial performance. Our calculation of Daily Vessel Operating Expenses may not be comparable to that reported by other companies. The following table reconciles our vessel operating expenses to Daily Vessel Operating Expenses.

(In thousands of US Dollars, except operating days and TCE rate)
  
United Maritime Corporation
  

 
Year ended
December 31,
2024
    
Year ended
December 31,
2023
    
For the period from
January 20, 2022
(date of inception)
to December 31, 2022
  
                   
Vessel revenue, net
  
$
45,439
    
$
36,067
    
$
22,784
  
Voyage expenses
  
$
(1,771
)
  
$
(3,107
)
  
$
(5,245
)
Time charter equivalent revenues
  
$
43,688
    
$
32,960
    
$
17,539
  
Operating days
    
2,778
      
2,143
      
610
  
TCE rate
  
$
15,719
    
$
15,380
    
$
28,752
  

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(In thousands of US Dollars, except operating days and TCE rate)
 
  
United Maritime
Predecessor
  
   
For the period from
January 1, 2022
through
July 5, 2022
  
       
Vessel revenue, net
  
$
2,327
  
Voyage expenses
  
$
(440
)
Time charter equivalent revenues
  
$
1,887
  
Operating days
    
116
  
TCE rate
  
$
16,267
  

(In thousands of US Dollars, except ownership days and Daily Vessel Operating Expenses)
                  
   
Year ended
December 31, 2024
    
Year ended
December 31, 2023
    
For the period from
January 20, 2022
(date of inception)
to December 31, 2022
  
                   
Vessel operating expenses
  
$
19,745
    
$
20,338
    
$
5,179
  
Pre-delivery expenses
  
$
(724
)
  
$
(4,291
)
  
$
(718
)
Vessel operating expenses before pre-delivery expenses
  
$
19,021
    
$
16,047
    
$
4,461
  
Ownership days
    
2,875
      
2,339
      
614
  
Daily Vessel Operating Expenses
  
$
6,616
    
$
6,861
    
$
7,265
  

(In thousands of US Dollars, except ownership days and Daily Vessel Operating Expenses)
  
United Maritime
Predecessor
  
   
For the period from
January 1, 2022
through
July 5, 2022
  
       
Vessel operating expenses
  
$
1,100
  
Ownership days
    
186
  
Daily Vessel operating expenses
  
$
5,914
  

E.
Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of those financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions and conditions.

Critical accounting estimates are those that reflect significant judgments of uncertainties and potentially result in materially different results under different assumptions and conditions. We have described below what we believe is our most critical accounting estimate, because it generally involves a comparatively higher degree of judgment in its application. For a description of all our significant accounting policies, see Note 2 to our annual audited financial statements included in this annual report.

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Impairment of Long-lived Assets

We review our long-lived assets for impairment whenever events or changes in circumstances, such as prevailing market conditions, obsolescence or damage to the asset, business plans to dispose a vessel earlier than the end of its useful life and other business plans, indicate that the carrying amount of the assets, plus unamortized dry-docking costs or right-of use assets, may not be recoverable. The volatile market conditions in the dry bulk market with decreased charter rates and decreased vessel market values are conditions we consider to be indicators of a potential impairment for our vessels and right-of use assets. We determine undiscounted projected operating cash flows, for each vessel and right-of use assets with an impairment indicator and compare it to the vessel’s carrying value or right-of use asset. When the undiscounted projected operating cash flows expected to be generated by the use of the vessel and/or its eventual disposition are less than its carrying amount, we impair the carrying amount of the vessel or right-of use assets. Measurement of the impairment loss is based on the fair value of the vessel as determined by independent valuators and use of available market data. The undiscounted projected operating cash inflows are determined by considering the charter revenues from existing time charters for the fixed days and an estimated daily time charter equivalent for the non-fixed days, based on a combination of one year charter rates estimate and the average of the trailing 10-year historical charter rates, excluding the outliers, inflated annually by a 2.0% growth rate. Charter revenues are adjusted for commissions, expected off hires due to scheduled vessel maintenance and estimated unexpected breakdown off hires. The undiscounted projected operating cash outflows are determined by applying various assumptions regarding vessel operating expenses and scheduled vessel maintenance.

Our assessment concluded that no impairment loss should be recorded as of December 31, 2024 and 2023.

Our Fleet – Illustrative Comparison of Possible Excess of Carrying Value Over Estimated Charter-Free Market Value of Certain Vessels

Historically, the market values of vessels have experienced volatility, which from time to time may be substantial. As a result, the charter-free market values of our vessels may have declined below the vessels’ carrying value or right-of use assets, even though we would not impair the vessel’s carrying value or right-of use assets under our accounting impairment policy. The table set forth below indicates (i) the carrying value of our vessels and right-of use assets as of December 31, 2024 and December 31, 2023, respectively, and (ii) if we believe our vessels had a basic market value below their carrying value. The carrying value includes, as applicable, vessel costs or right-of use assets, plus any unamortized deferred dry-docking costs. The difference between the carrying value of our vessels or right-of use assets and their market value of $5.2 million and $5.5 million, as of December 31, 2024 and 2023, respectively, represents the amount by which we believe we would have had to reduce our net income if we sold our vessels, on industry standard terms, in cash transactions, and to a willing buyer where we are not under any compulsion to sell, and where the buyer was not under any compulsion to buy as of December 31, 2024 and 2023. For purposes of this calculation, we assumed that the vessels would be sold at a price that reflected our estimate of their charter-free market value as of December 31, 2024 and 2023.


​
         
Carrying value plus unamortized dry-docking costs
as of
(in millions of U.S. dollars)
  
 
Vessel
  
Year Built
  
Dwt
    
December 31, 2024
(in millions of U.S. dollars)
    
December 31, 2023
(in millions of U.S. dollars)
  
Tradership
  
2006
    
179,925
      
17.2
      
20.0
*
Goodship
  
 2005
    
177,536
      
16.4
      
16.2
  
Gloriuship
  
2004
    
171,314
      
-
      
15.9
*
Nisea
  
2016
    
82,235
      
27.6
*
    
-
  
Oasea
  
 2010
    
82,217
      
-
      
18.7
  
Cretansea
  
2009
    
81,508
      
19.0
*
    
18.9
*
Chrisea
  
 2013
    
78,173
      
20.5
      
21.5
*
Synthesea
  
2015
    
78,020
      
25.0
*
    
26.2
*
Exelixsea
  
 2011
    
76,361
      
16.5
      
17.6
  
TOTAL
                
142.2
      
155.0
  

*
Indicates Company’s vessels or right-of use assets for which we believe, as of December 31, 2024 and 2023, the basic charter-free market value was lower than the vessel’s carrying value or right-of use assets plus unamortized dry-docking costs.

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Our estimate of charter-free market value assume that our vessels were in good and seaworthy condition without need for repair and if inspected would be certified in class without notations of any kind. Our estimate is based on information available from various industry sources, including:


 •
reports by industry analysts and data providers that focus on our industry and related dynamics affecting vessel values;


•
news and industry reports of similar vessel sales;


•
news and industry reports of sales of vessels that are not similar to our vessels where we have made certain adjustments in an attempt to derive information that can be used as part of our estimates;


•
approximate market values for our vessels or similar vessels that we have received from shipbrokers, whether solicited or unsolicited, or that shipbrokers have generally disseminated;


•
offers that we may have received from potential purchasers of our vessels; and


•
vessel sale prices and values of which we are aware through both formal and informal communications with shipowners, shipbrokers, industry analysts and various other shipping industry participants and observers.

As we obtain information from various industry and other sources, our estimates of basic market value are inherently uncertain. In addition, vessel values are highly volatile; as such, our estimates may not be indicative of the current or future basic market value of our vessels or prices that we could achieve if we were to sell them. We refer you to the risk factor entitled “The market values of our vessels may decrease, which could limit the amount of funds that we can borrow in the future, trigger breaches of certain financial covenants under any future loan agreements and other financing agreements, and we may incur an impairment or, if we sell vessels following a decline in their market value, a loss.”

Although we believe that the assumptions used to evaluate potential asset impairment are based on historical trends and are reasonable and appropriate, such assumptions are highly subjective. There can be no assurance as to how charter rates and vessel values will fluctuate in the future. Charter rates may, from time to time throughout our vessels’ lives, remain for a considerable period of time at depressed levels which could adversely affect our revenue and profitability, and future assessments of vessel impairment. To minimize such subjectivity, our analysis for the year ended December 31, 2024, for which indicators of impairment were identified, also involved sensitivity analysis to the model input we believe is more important and likely to change. In particular, in terms of our estimates for the time charter equivalent for the unfixed period, we use a combination of one-year charter rates estimate and the average of the trailing 10-year historical charter rates, excluding outliers, inflated annually by a 2.0% growth rate. Although the trailing 10-year historical charter rates, excluding the outliers, cover at least a full business cycle, we sensitized our model with regards to long-term historical charter rate assumptions for the unfixed period beyond the first year. The impairment test that we conduct, when required, is most sensitive to variances in future time charter rates. Our sensitivity analysis revealed that, to the extent that going forward the 10-year historical charter rates, excluding the outliers, would not decline by more than 13% for Panamax and Kamsarmax vessels, we would not require to recognize impairment for the year ended December 31, 2024.

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ITEM 6.
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.
Directors and Senior Management

Set forth below are the names, ages and positions of our directors and executive officers. Members of our board of directors are elected annually on a staggered basis, and each director elected holds office for a three-year term. Officers are elected from time to time by vote of our board of directors and hold office until a successor is elected. The business address of each of our directors and executive officers listed below is 154 Vouliagmenis Avenue, 166 74 Glyfada, Greece.

Name
​
Age
  
Position
​
Director Class
Stamatios Tsantanis
​
53
  
Chairman, Chief Executive Officer & Director
​
C
Stavros Gyftakis
​
46
  
Chief Financial Officer & Director
​
B
Christina Anagnostara
​
54
  
Director*
​
A
Ioannis Kartsonas
​
53
  
Director*
​
A
Dimitrios Kostopoulos
​
50
  
Director*
​
B

*
Independent Director

The term of our Class A directors expires at the annual general meeting of shareholders in 2026, the term of our Class B directors expires at the annual general meeting of shareholders in 2027, and the term of our Class C directors expires at the annual general meeting of shareholders in 2025.

Biographical information with respect to each of our directors and our executive officers is set forth below.

Stamatios Tsantanis is the founder and the Chairman, Chief Executive Officer and a member of our board of directors. Mr. Tsantanis is currently the Chairman of the board of directors and the Chief Executive Officer of Seanergy, serving in the role since October 2012 and has led Seanergy’s significant growth to a world-renowned Capesize dry bulk company with a carrying capacity of approximately 3.8 million dwt. Mr. Tsantanis also served as Seanergy’s Interim Chief Financial Officer from November 2013 until October 2018. Mr. Tsantanis has been actively involved in the shipping and finance industry since 1998 and has held senior management positions in prominent private and public shipping companies and financial institutions. He was formerly an investment banker at Alpha Finance, a member of the Alpha Bank Group, with active roles in a number of major shipping corporate finance transactions in the U.S capital markets. Mr. Tsantanis holds a Master of Science (MSc) in Shipping Trade and Finance from Bayes Business School (formerly known as Cass Business School) of City University in London and a Bachelor of Science (BSc) in Shipping Economics from the University of Piraeus. He also serves in the board of directors of Breakwave Advisors LLC, the Commodity Trading Advisor (CTA) for the Breakwave Dry Bulk Shipping ETF (NYSE: BDRY) and the Breakwave Tanker Shipping ETF (NYSE: BWET) and is a fellow of the Institute of Chartered Shipbrokers.

Stavros Gyftakis is our Chief Financial Officer and a member of our board of directors. Mr. Gyftakis is also Seanergy’s Chief Financial Officer and has been instrumental in Seanergy’s capital raising, debt financing and refinancing activities since 2017. He has more than 19 years of experience in banking and corporate finance with focus on the shipping sector. Mr. Gyftakis has held key positions across a broad shipping finance spectrum, including, asset backed lending, debt and corporate restructurings, risk management, financial leasing and loan syndications. Before joining Seanergy, he was a Senior Vice President on the Greek shipping finance desk at DVB Bank SE. Mr. Gyftakis received his Master of Science (MSc) in Shipping Trade and Finance from Bayes Business School (formerly known as Cass Business School) in London with Distinction. He also holds a Master of Science (MSc) in Business Mathematics, awarded with Honors, from the Athens University of Economics and Business and a Bachelor of Science (BSc) in Mathematics from the Aristotle University of Thessaloniki.

Christina Anagnostara is a member of our board of directors and the Chairman and a member of United’s Audit and Nominating Committees. Ms. Anagnostara is also a member of the board of directors of Seanergy, and between 2008 to 2013 she served as Seanergy’s Chief Financial Officer. She has more than 26 years of maritime and international business experience in the areas of finance, banking, capital markets, consulting, accounting and audit. Before joining Seanergy, she served in executive and board positions of publicly listed companies in the maritime industry and she was responsible for the financial, capital raising and accounting functions. Since 2017 she is a Managing Director in the Investment Banking Division of AXIA Ventures Group and between 2014 and 2017 she provided advisory services to corporate clients involved in all aspects of the maritime industry. From 2006 to 2008, she served as the Chief Financial Officer and member of the board of directors of Global Oceanic Carriers Ltd, a dry bulk shipping company listed on the Alternative Investment Market of the London Stock Exchange. Between 1999 and 2006, she was a senior management consultant of the Geneva-based EFG Group. Prior to EFG Group, she worked for Eurobank EFG and Ernst & Young. Ms. Anagnostara has studied Economics in Athens and is a Certified Chartered Accountant.

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Ioannis Kartsonas is a member of our board of directors, the Chairman and a member of United’s Compensation Committee and a member of United’s Nominating Committee. Mr. Kartsonas is also a member of the board of directors of Seanergy and the Principal and Managing Partner of Breakwave Advisors LLC., a commodity-focused advisory firm based in New York. Mr. Kartsonas has been actively involved in finance and commodities trading since 2000. From 2011 to 2017, he was a Senior Portfolio Manager at Carlyle Commodity Management, a commodity-focused investment firm based in New York and part of the Carlyle Group, being responsible for the firm’s shipping and freight investments. During his tenure, he managed one of the largest freight futures funds globally. Prior to this role, Mr. Kartsonas was a Co-Founder and Portfolio Manager at Sea Advisors Fund, an investment fund focused in shipping. From 2004 to 2009, he was the leading Transportation Analyst at Citi Investment Research covering the broader transportation space, including the shipping industry. Prior to that, he was an Equity Analyst focusing on shipping and energy for Standard & Poor’s Investment Research. Mr. Kartsonas holds an MBA in Finance from the Simon School of Business, University of Rochester.

Dimitrios Kostopoulos is a member of our board of directors and a member of United’s Audit and Compensation Committees. Mr. Kostopoulos is the Chief Executive Officer of Alpha Finance S.A., the brokerage arm of Alpha Bank Group, one of the leading Groups of the financial sector in Greece. He has more than 20 years of experience in the financial services industry. Prior to assuming his position in Alpha Finance, he served as Head of Investor Relations of the Alpha Bank Group for more than 10 years, with a focus on the institutional shareholding base of the bank. During his tenure, he was actively engaged in all the significant capital raisings that Alpha Bank Group successfully concluded in the Equity and Debt Capital Markets. Prior to this, Mr. Kostopoulos served as Fund Manager in Alpha Asset Management M.F.M.C. and he has also held positions in the Private Banking and Treasury units of the Group. Mr. Kostopoulos holds a Master of Science (MSc) in Shipping Trade & Finance from Bayes Business School (formerly named Cass Business School) of City University in London.

No family relationships exist among any of the directors and executive officers.

B.
Compensation

For the year ended December 31, 2024, the aggregate cash compensation and bonus for the Company's executive officers and directors amounted to $1.5 million. In addition, each director is reimbursed for out-of-pocket expenses in connection with attending meetings board of directors or committees.

On March 27, 2024, the Compensation Committee of our board of directors approved the amendment and restatement of our 2022 Equity Incentive Plan to increase the aggregate number of common shares reserved for issuance under the plan to 400,000 shares, and granted awards under the plan of an aggregate of 260,000 common shares to members of the Company’s board of directors and 75,000 common shares to certain of the Company’s service providers and to the sole director of the Company’s commercial manager, a non-employee. The fair value of each share on the grant date was $2.635. On March 27, 2024, 67,000 shares vested, on September 27, 2024, 100,500 shares vested and 167,500 shares vested on March 27, 2025.

On April 7, 2025, the Compensation Committee of our board of directors approved a further amendment and restatement of our 2022 Equity Incentive Plan to increase the aggregate number of common shares reserved for issuance under the plan to 400,000 shares, and granted awards under the plan of an aggregate of 275,000 common shares to the members of the Company’s board of directors and 85,000 common shares to certain of the Company’s service providers and to the sole director of the Company’s commercial manager, a non-employee. The fair value of each share on the grant date was $1.20. 79,500 shares vested on April 7, 2025, 113,000 shares will vest on October 7, 2025 and 167,500 shares will vest on April 7, 2026.

Each director is fully indemnified by us for actions associated with being a director to the extent permitted under Marshall Islands law. Furthermore, in line with Nasdaq requirements we have established a clawback policy, a copy of which has been filed as Exhibit 97.1 to this Annual Report.

Equity Incentive Plan

Our board of directors in July 2022 adopted the 2022 Equity Incentive Plan (the “Plan”). On October 14, 2022, the Plan was amended and restated to increase the aggregate number of common shares reserved for issuance under the Plan to 1,500,000 shares. On December 28, 2022, the Plan was further amended and restated to increase the aggregate number of common shares reserved for issuance under the Plan to 2,000,000 shares. On March 27, 2024, the Plan was further amended and restated to increase the aggregate number of common shares reserved for issuance under the Plan to 400,000 shares. 65,000 shares remain available for issuance under the Plan. On April 7, 2025, the Plan was further amended and restated to increase the aggregate number of common shares reserved for issuance under the Plan to 400,000 shares. 40,000 shares remain available for issuance under the Plan.

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Under the Plan and as amended, the Company’s employees, officers, directors and service providers are entitled to receive options to acquire the Company’s common shares. The Plan is administered by the compensation committee of our board of directors, or such other committee of the board of directors as may be designated by the board of directors. Under the Plan, our officers, key employees, directors, consultants and service providers may be granted incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, unrestricted stock, restricted stock units, and unrestricted stock at the discretion of our compensation committee. Any awards granted under the Plan that are subject to vesting are conditioned upon the recipient’s continued service as an employee or a director of the Company, through the applicable vesting date. Unvested shares granted under the Plan are entitled to receive dividends which are not refundable, even if such shares are forfeited.

We do not have a retirement plan for our officers or directors.

C.
Board Practices

Our directors do not have service contracts and do not receive any benefits upon termination of their directorships. Our board of directors has an audit committee, a compensation committee and a nominating committee. Our board of directors has adopted a charter for each of these committees.

Audit Committee

Our audit committee consists of Christina Anagnostara and Dimitrios Kostopoulos. Our board of directors has determined that the members of the audit committee meet the applicable independence requirements of the Commission and the Nasdaq Stock Market Rules.

The audit committee has powers and performs the functions customarily performed by such a committee (including those required of such a committee by Nasdaq and the Commission). The audit committee is responsible for selecting and meeting with our independent registered public accounting firm regarding, among other matters, audits and the adequacy of our accounting and control systems.

Compensation Committee

Our compensation committee consists of Ioannis Kartsonas and Dimitrios Kostopoulos, each of whom is an independent director. The compensation committee reviews and approves the compensation of our executive officers.

Nominating Committee

Our nominating committee consists of Christina Anagnostara and Ioannis Kartsonas, each of whom is an independent director. The nominating committee is responsible for overseeing the selection of persons to be nominated to serve on our board of directors.

D.
Employees

We have two executive officers, Mr. Stamatios Tsantanis and Mr. Stavros Gyftakis, and we employ Ms. Theodora Mitropetrou, our general counsel. In addition, we employ a support staff consisting of three employees.

E.
Share Ownership

The common shares beneficially owned by our directors and executive officers are disclosed below in “Item 7. Major Shareholders and Related Party Transactions.”

F.
Disclosure of a registrant’s action to recover erroneously awarded compensation.

None.

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ITEM 7.
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A.
Major Shareholders

The following table sets forth information regarding ownership of our common shares by each person or entity known by us to be the beneficial owner of more than 5% of our outstanding common shares, each of our directors and executive officers, and all of our directors and executive officers as a group. To the best of our knowledge, except as disclosed in the table below or with respect to our directors and executive officers, we are not controlled, directly or indirectly, by another corporation, by any foreign government or by any other natural or legal persons. All of our common shareholders, including the shareholders listed in this table, will be entitled to one vote for each common share held.

Calculation of percent of class beneficially owned by each person is based on 9,204,267 common shares outstanding as of April 7, 2025. Beneficial ownership is determined in accordance with the Commission’s rules. Accordingly, in computing percentage ownership of each person, shares underlying securities held by that person that are currently exercisable or convertible, or exercisable or convertible within 60 days of the date of this annual report, are deemed to be beneficially owned by that person. These shares, however, are not deemed outstanding for the purpose of computing the percentage ownership of any other person.
Identity of Person or Group
  
Number of
Shares Owned
    
Percent of
Class
  
Stamatios Tsantanis(1)
    
1,194,534
      
13.0
%
Dimitrios Kostopoulos
    
235,000
      
2.6
%
Christina Anagnostara
    
220,000
      
2.4
%
Stavros Gyftakis
    
216,678
      
2.4
%
Ioannis Kartsonas
    
119,067
      
1.3
%
Directors and officers as a group (5 individuals)
    
1,985,279
      
21.6
%

(1)
In addition, Stamatios Tsantanis owns 100% of our issued and outstanding Series B Preferred Shares, or 40,000 of our Series B Preferred Shares. Through his beneficial ownership of our Series B Preferred Shares, Stamatios Tsantanis controls 49.99% of the vote of any matter submitted to the vote of the common shareholders. See “Description of Capital Stock — Series B Preferred Stock” for a description of the terms, including the voting power, of the Series B Preferred Shares.

As of April 7, 2025, we had 26 shareholders of record, 5 of which were located in the United States, holding an aggregate of approximately 8,269,031 of our common shares, representing approximately 89.9% of our outstanding common shares. However, one of the U.S. shareholders of record is Cede & Co., a nominee of The Depository Trust Company, which held approximately 8,231,359 of our common shares. Accordingly, we believe that the shares held by Cede & Co. include common shares beneficially owned by both holders in the United States and non-U.S. beneficial owners. We are not aware of any arrangements the operation of which may at a subsequent date result in our change of control.

B.
Related Party Transactions

On January 20, 2022, United was incorporated by Seanergy, under the laws of the Republic of the Marshall Islands to serve as the holding company of the Predecessor that was contributed to United by Seanergy upon effectiveness of the Spin-Off. The Spin-Off was pro rata to the shareholders of the Parent, including holders of the Parent’s outstanding common shares and Series B preferred shares, so that such holders maintained the same proportionate interest in the Parent and in United both immediately before and immediately after the Spin-Off. In connection with the Spin-Off, our Chairman and Chief Executive Officer received 40,000 Series B Preferred Shares, while 5,000 Series C Preferred Shares were issued to Seanergy in exchange for $5.0 million working capital contribution. Following the Spin-Off, United and Seanergy are independent publicly traded companies.

Seanergy Maritime Holdings Corp. Right of First Refusal

Prior to the consummation of the Spin-Off, we entered into a right of first refusal agreement with Seanergy pursuant to which Seanergy has a right of first refusal with respect to any opportunity available to us to sell, acquire or charter-in any Capesize vessel as well as with respect to chartering opportunities, other than short-term charters with a term of 13 months or less, available to us for Capesize vessels. In addition, we have a right of first offer with respect to any vessel sales by Seanergy. United exercised such right in December 2022 with respect to the sale of the M/Vs Goodship and Tradership.

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Management Agreements

Prior to the consummation of the Spin-Off, United entered into a master management agreement with Seanergy for the provision of technical, administrative, commercial, brokerage and certain other services for our vessels. Certain of these services are being contracted directly with Seanergy’s wholly owned subsidiaries, Seanergy Shipmanagement and Seanergy Management. The master management agreement provides for a fixed administration fee of $325 per vessel per day payable to Seanergy. The initial term of our master management agreement with Seanergy expired on December 31, 2024, and was automatically extended for an additional 12-month period. The master management agreement may be terminated immediately only for cause and at any time by either party with three months’ prior notice, and no termination fee will be payable.

In relation to the technical management, Seanergy Shipmanagement is responsible for arranging for the day-to-day operations, inspections, maintenance, repairs, drydocking, purchasing, insurance and claims handling for the M/V Gloriuship, the M/V Synthesea, the M/V Nisea, the M/V Goodship, the M/V Chrisea and the M/V Cretansea. The technical management agreements provide for a fixed management fee of $14,000 per month per vessel. In 2024 and up until March 17, 2024 we paid a monthly fee of $10,000 to Seanergy Shipmanagement for the M/V Goodship. In 2024 and up until July 19, 2024 we paid a monthly fee of $14,000 to Seanergy Shipmanagement for the M/V Oasea.

In addition, United had entered into a commercial management agreement with Seanergy Management pursuant to which Seanergy Management acted as agent for United’s subsidiaries (directly or through subcontracting) for the commercial management of United’s vessels, including chartering, monitoring thereof, freight collection, and sale and purchase. Such agreement was in effect up until April 1, 2023, except for the M/T Epanastasea for which the agreement was valid until her sale in August 2023. Pursuant to this agreement, we were paying to Seanergy Management a fee equal to 1.25% of the gross freight, demurrage and charter hire collected from the employment of our vessels except for any vessels that would be chartered-out to Seanergy. Seanergy Management also earned a fee equal to 1% of the contract price of any vessel bought or sold by them on our behalf until March 31, 2023, except for any vessels bought or sold from or to Seanergy, or in respect of any vessel sale relating to a sale leaseback transaction.

Since April 1, 2023, United Management entered into a management agreement with Seanergy Management for the commercial management of our vessels, including postfixture, commercial operation, sale and purchase and bareboat chartering. Pursuant to this agreement, we are paying to Seanergy Management a commission fee equal to 0.75% of the collected freight, demurrage and charter hire collected from the employment of our vessels, except for any vessels that may be chartered-out to Seanergy. Seanergy Management also earns a fee equal to 1% of the contract price of any vessel bought, sold or bareboat chartered by them on our behalf, except for any vessels bought, sold or bareboat chartered from or to Seanergy, or in respect of any vessel sale relating to a sale leaseback transaction.

Additional vessels that we may acquire in the future may be managed by Seanergy Shipmanagement, Seanergy Management or by other unaffiliated management companies.

We may enter into similar or new management agreements for the management of any additional vessels we may acquire in the future.

Contribution and Conveyance Agreement

Prior to the consummation of the Spin-Off, we entered into the Contribution and Conveyance Agreement with Seanergy. Pursuant to the Contribution and Conveyance Agreement, Seanergy, in conjunction with the Spin-Off, (i) contributed the United Maritime Predecessor, together with $5.0 million in working capital, and (ii) agreed to indemnify us and United Maritime Predecessor for any and all obligations and other liabilities arising from or relating to the operation, management or employment of M/V Gloriuship prior to the effective date of the Spin-Off, except for the July 2022 EnTrust Facility.

Share Purchase Agreement

On July 26, 2022, we entered into a Share Purchase Agreement with Seanergy pursuant to which Seanergy purchased 5,000 of our newly issued Series C Preferred Shares in exchange for $5.0 million payable in cash in connection with our obligation to pay the advance deposits pursuant to the memoranda of agreement for the M/Ts Parosea, Bluesea, Minoansea and Epanastasea. In November 2022, we redeemed all 10,000 Series C Preferred Shares issued to Seanergy pursuant to their terms for a gross redemption price (including all accrued and unpaid dividends up to the redemption date) of $10.6 million.

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C.
Interests of Experts and Counsel

Not applicable.

ITEM 8.
FINANCIAL INFORMATION

A.
Consolidated Statements and Other Financial Information

See Item 18.

Legal Proceedings

Various claims, suits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. We are not a party to any material litigation where claims or counterclaims have been filed against us other than routine legal proceedings incidental to our business.

Dividend Policy

The declaration, timing and amount of any dividend is subject to the discretion of our board of directors and will be dependent upon our earnings, financial condition, market prospects, capital expenditure requirements, investment opportunities, restrictions in our loan agreements, the provisions of the Marshall Islands law affecting the payment of dividends to shareholders, overall market conditions and other factors. On February 19, 2024, we declared a cash dividend of $0.075 per share for the fourth quarter of 2023, which we paid on April 10, 2024 to all shareholders of record as of March 22, 2024. On May 23, 2024, the Company declared a cash dividend of $0.075 per share for the first quarter of 2024, which we paid on July 10, 2024 to all shareholders of record as of June 25, 2024. On October 10, 2024, we paid a quarterly cash dividend of $0.075 per common share for the second quarter of 2024 to all shareholders of record as of September 27, 2024. On January 10, 2025, we paid a quarterly cash dividend of $0.075 per common share for the third quarter of 2024 to all shareholders of record as of December 27, 2024. On March 17, 2025, we declared a cash dividend of $0.01 per share for the fourth quarter of 2024, which was paid on April 10, 2025 to all shareholders of record as of March 27, 2025.

Our board of directors may review and amend our dividend policy from time to time in light of our plans for future growth and other factors. In addition, since we are a holding company with no material assets other than the shares of our subsidiaries and affiliates through which we conduct our operations, our ability to pay dividends will depend on our subsidiaries and affiliates distributing to us their earnings and cash flow. Our loan agreements impose certain limitations on our ability to pay dividends and our subsidiaries’ ability to make distributions to us.

B.
Significant Changes

There have been no significant changes since the date of the consolidated financial statements included in this annual report, other than those described in note 11 “Subsequent events” of these statements.


ITEM 9.
THE OFFER AND LISTING

Not applicable except for Item 9.A.4. and Item 9.C.

Share History and Markets

Since July 6, 2022, the primary trading market for our common shares has been Nasdaq on which our shares are now listed under the symbol “USEA”.

ITEM 10.
ADDITIONAL INFORMATION

A.
Share Capital

Not applicable.

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B.
Memorandum and articles of association

Our current amended and restated articles of incorporation have been filed as Exhibit 1.1 to our Registration Statement on Form 20-F filed on June 6, 2022. The information contained in this exhibit is incorporated by reference herein.

On December 27, 2023, our board of directors adopted the Second Amended and Restated Bylaws of the Company, which are attached to this report as Exhibit 1.2.

A description of the material terms of our amended and restated articles of incorporation and second amended and restated bylaws and of our capital stock is included in “Description of Securities” attached hereto as Exhibit 2.4 and incorporated by reference herein.

C.
Material contracts

Attached as exhibits to this annual report are the contracts we consider to be both material and outside the ordinary course of business and are to be performed in whole or in part after the filing of this annual report. We refer you to “Item 4. Information on the Company – A. History and Development of the Company,” “Item 4. Information on the Company – B. Business Overview,” “Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources,” and “Item 7. Major Shareholders and Related Party Transactions – B. Related Party Transactions” for a discussion of our material contracts. Other than as discussed in this annual report, we have no material contracts, other than contracts entered into in the ordinary course of business, to which we are a party.

D.
Exchange controls

Under Marshall Islands law, there are currently no restrictions on the export or import of capital, including foreign exchange controls, or restrictions that affect the remittance of dividends, interest or other payments to non-resident holders of our common shares.

E.
Taxation

The following represents the opinion of our United States and Marshall Islands tax counsel, Watson Farley & Williams LLP, and is a summary of the material U.S. federal income tax and Marshall Islands tax consequences of the ownership and disposition of our common shares as well as the material U.S. federal and Marshall Islands income tax consequences applicable to us and our operations. The discussion below of the U.S. federal income tax consequences to “U.S. Holders” will apply to a beneficial owner of our common shares that is treated for U.S. federal income tax purposes as:


 •
an individual citizen or resident of the United States;


•
a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the District of Columbia;


•
an estate whose income is includible in gross income for U.S. federal income tax purposes regardless of its source; or


•
a trust if (i) a U.S. court can exercise primary supervision over the trust’s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust, or (ii) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

If you are not described as a U.S. Holder and are not an entity treated as a partnership or other pass-through entity for U.S. federal income tax purposes, you will be considered a “Non-U.S. Holder.” The U.S. federal income tax consequences applicable to Non-U.S. Holders is described below under the heading “United States Federal Income Taxation of Non-U.S. Holders.”

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This discussion does not consider the tax treatment of partnerships or other pass-through entities or persons who hold our common shares through such entities. If a partnership (or other entity classified as a partnership for U.S. federal income tax purposes) is the beneficial owner of our common shares, the U.S. federal income tax treatment of a partner in the partnership generally will depend on the status of the partner and the activities of the partnership.

This summary is based on the U.S. Internal Revenue Code of 1986, as amended, or the Code, its legislative history, Treasury Regulations promulgated thereunder, published rulings and court decisions, all as currently in effect. These authorities are subject to change, possibly on a retroactive basis.

This summary does not address all aspects of U.S. federal income taxation that may be relevant to any particular holder based on such holder’s individual circumstances. In particular, this discussion considers only holders that will own and hold our common shares as capital assets within the meaning of Section 1221 of the Code and does not address the potential application of the alternative minimum tax or the U.S. federal income tax consequences to holders that are subject to special rules, including:


 •
financial institutions or “financial services entities”;


•
broker-dealers;


•
taxpayers who have elected mark-to-market accounting for U.S. federal income tax purposes;


•
tax-exempt entities;


•
governments or agencies or instrumentalities thereof;


•
insurance companies;


•
regulated investment companies;


•
real estate investment trusts;


•
certain expatriates or former long-term residents of the United States;


•
persons that actually or constructively own 10% or more (by vote or value) of our shares;


•
persons that own shares through an “applicable partnership interest”;


•
persons required to recognize income for U.S. federal income tax purposes no later than when such income is reported on an “applicable financial statement”;


•
persons that hold our common shares as part of a straddle, constructive sale, hedging, conversion or other integrated transaction; or


•
persons whose functional currency is not the U.S. dollar.

This summary does not address any aspect of U.S. federal non-income tax laws, such as gift or estate tax laws, or state, local or non-U.S. tax laws.

We have not sought, nor do we intend to seek, a ruling from the Internal Revenue Service, or the IRS, as to any U.S. federal income tax consequence described herein. The IRS may disagree with the description herein, and its determination may be upheld by a court.

Because of the complexity of the tax laws and because the tax consequences to any particular holder of our common shares may be affected by matters not discussed herein, each such holder is urged to consult with its tax advisor with respect to the specific tax consequences of the ownership and disposition of our common shares, including the applicability and effect of state, local and non-U.S. tax laws, as well as U.S. federal tax laws.

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United States Federal Income Tax Consequences

Taxation of Operating Income in General

Unless exempt from United States federal income taxation under the rules discussed below, a foreign corporation is subject to United States federal income taxation in respect of any income that is derived from the use of vessels, from the hiring or leasing of vessels for use on a time, voyage or bareboat charter basis, from the participation in a shipping pool, partnership, strategic alliance, joint operating agreement, code sharing arrangement or other joint venture it directly or indirectly owns or participates in that generates such income, or from the performance of services directly related to those uses, which we refer to as “shipping income,” to the extent that the shipping income is derived from sources within the United States. For these purposes, 50% of the gross shipping income that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States, exclusive of certain U.S. territories and possessions, constitutes income from sources within the United States, which we refer to as “U.S. source gross shipping income.”

Shipping income attributable to transportation that both begins and ends in the United States is considered to be 100% from sources within the United States. We are prohibited by law from engaging in transportation that produces income considered to be 100% from sources within the United States.

Shipping income attributable to transportation exclusively between non-U.S. ports will be considered to be 100% derived from sources outside the United States. Shipping income earned by us that is derived from sources outside the United States will not be subject to any United States federal income tax.

We are subject to a 4% tax imposed without allowance for deductions for such taxable year, as described in “– Taxation in Absence of Exemption,” unless we qualify for exemption from tax under Section 883 of the Code, the requirements of which are described in detail below.

Exemption of Operating Income from United States Federal Income Taxation

Under Section 883 of the Code and the regulations thereunder, we will be exempt from United States federal income taxation on our U.S. source shipping income if (i) we are organized in a foreign country (our “country of organization”) that grants an “equivalent exemption” to corporations organized in the United States and (ii) one of the following statements is true:


 •
more than 50% of the value of our stock is owned, directly or indirectly, by “qualified shareholders,” that are persons (i) who are “residents” of our country of organization or of another foreign country that grants an “equivalent exemption” to corporations organized in the United States, and (ii) we satisfy certain substantiation requirements, which we refer to as the “50% Ownership Test”; or


•
our stock is “primarily” and “regularly” traded on one or more established securities markets in our country of organization, in another country that grants an “equivalent exemption” to United States corporations, or in the United States, which we refer to as the “Publicly-Traded Test.”

The jurisdictions where we and our subsidiaries are incorporated grant “equivalent exemptions” to United States corporations. Therefore, we will be exempt from United States federal income taxation with respect to our U.S. source shipping income if we satisfy either the 50% Ownership Test or the Publicly-Traded Test.

50% Ownership Test

Under the regulations, a foreign corporation will satisfy the 50% Ownership Test for a taxable year if (i) for at least half of the number of days in the taxable year, more than 50% of the value of its stock is owned, directly or constructively through the application of certain attribution rules prescribed by the regulations, by one or more shareholders who are residents of foreign countries that grant “equivalent exemption” to corporations organized in the United States and (ii) the foreign corporation satisfies certain substantiation and reporting requirements with respect to such shareholders. These substantiation requirements are onerous and therefore there can be no assurance that we would be able to satisfy them, even if our share ownership would otherwise satisfy the requirements of the 50% Ownership Test.

We believe that we did not satisfy the 50% Ownership Test for our 2024 taxable year.

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Publicly-Traded Test

The regulations provide that the stock of a foreign corporation will be considered to be “primarily traded” on an established securities market in a country if the number of shares of each class of stock used to satisfy the Publicly-Traded Test that is traded during the taxable year on all established securities markets in that country exceeds the number of shares in each such class that is traded during that year on established securities markets in any other single country.

Under the regulations, the stock of a foreign corporation will be considered “regularly traded” if one or more classes of its stock representing 50% or more of its outstanding shares, by total combined voting power of all classes of stock entitled to vote and by total combined value of all classes of stock, are listed on one or more established securities markets (such as the Nasdaq Capital Market on which our common shares are traded), which we refer to as the “listing threshold.”

The regulations further require that with respect to each class of stock relied upon to meet the listing requirement: (i) such class of the stock is traded on the market, other than in minimal quantities, on at least sixty (60) days during the taxable year or one-sixth (1/6) of the days in a short taxable year; and (ii) the aggregate number of shares of such class of stock traded on such market is at least 10% of the average number of shares of such class of stock outstanding during such year or as appropriately adjusted in the case of a short taxable year. Even if a foreign corporation does not satisfy both tests, the regulations provide that the trading frequency and trading volume tests will be deemed satisfied by a class of stock if such class of stock is traded on an established market in the United States and such class of stock is regularly quoted by dealers making a market in such stock.

Notwithstanding the foregoing, the regulations provide, in pertinent part, that a class of stock will not be considered to be “regularly traded” on an established securities market for any taxable year in which 50% or more of the vote and value of the outstanding shares of such class of stock are owned, actually or constructively under specified attribution rules, on more than half the days during the taxable year by persons who each own directly or indirectly 5% or more of the vote and value of such class of stock, whom we refer to as “5% Shareholders.” We refer to this restriction in the regulations as the “Closely-Held Rule.”

For purposes of being able to determine our 5% Shareholders, the regulations permit a foreign corporation to rely on Schedule 13G and Schedule 13D filings with the Commission. The regulations further provide that an investment company that is registered under the Investment Company Act of 1940, as amended, will not be treated as a 5% Shareholder for such purposes.

We believe that our common shares constituted 50% or more of our outstanding shares, by total combined voting power of all classes of our stock entitled to vote and by total combined value of all classes of stock for 2024. Furthermore, based on our analysis of our shareholdings during 2024 (Schedule 13G and Schedule 13D filings with the Commission), we believe that we satisfied the Publicly-Traded Test for our 2024 taxable year, and intend to take this position on our tax return.

Due to the factual nature of the issues involved, there can be no assurance that we and our subsidiaries will qualify for the benefits of Section 883 of the Code for the subsequent taxable years.

Taxation in Absence of Exemption

To the extent the benefits of Section 883 are unavailable, our U.S. source gross shipping income, to the extent not considered to be “effectively connected” with the conduct of a U.S. trade or business, as described below, would be subject to a 4% tax imposed by Section 887 of the Code on a gross basis, without the benefit of deductions, otherwise referred to as the “4% Tax.” Since under the sourcing rules described above, no more than 50% of our shipping income would be treated as being derived from U.S. sources, the maximum effective rate of U.S. federal income tax on our shipping income would never exceed 2% under the 4% Tax.

To the extent the benefits of the Section 883 exemption are unavailable and our U.S. source gross shipping income is considered to be “effectively connected” with the conduct of a U.S. trade or business, as described below, any such “effectively connected” U.S. source gross shipping income, net of applicable deductions, would be subject to the U.S. federal corporate income tax currently imposed at a rate of 21%. In addition, we may be subject to the 30% “branch profits” tax on earnings effectively connected with the conduct of such trade or business, as determined after allowance for certain adjustments, and for certain interest paid or deemed paid attributable to the conduct of our U.S. trade or business.

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Our U.S. source gross shipping income would be considered “effectively connected” with the conduct of a U.S. trade or business only if:


 •
we have, or are considered to have, a fixed place of business in the United States involved in the earning of shipping income; and


•
substantially all of our U.S. source gross shipping income is attributable to regularly scheduled transportation, such as the operation of a vessel that follows a published schedule with repeated sailings at regular intervals between the same points for voyages that begin or end in the United States, or, in the case of income from the leasing of a vessel, is attributable to a fixed place of business in the United States.

We do not intend to have, or permit circumstances that would result in having, any vessel operating to the United States on a regularly scheduled basis, or earn income from the leasing of a vessel attributable to a fixed place of business in the United States. Based on the foregoing and on the expected mode of our shipping operations and other activities, we believe that none of our U.S. source gross shipping income will be “effectively connected” with the conduct of a U.S. trade or business.

United States Taxation of Gain on Sale of Vessels

Regardless of whether we qualify for exemption under Section 883, we will not be subject to United States federal income taxation with respect to gain realized on a sale of a vessel, provided the sale is considered to occur outside of the United States under United States federal income tax principles. In general, a sale of a vessel will be considered to occur outside of the United States for this purpose if title to the vessel, and risk of loss with respect to the vessel, pass to the buyer outside of the United States. It is expected that any sale of a vessel by us will be considered to occur outside of the United States.

United States Federal Income Taxation of U.S. Holders

Taxation of Distributions Paid on Common Shares

Subject to the passive foreign investment company, or PFIC, rules discussed below, any distributions made by us with respect to common shares to a U.S. Holder will generally constitute dividends, which may be taxable as ordinary income or “qualified dividend income” as described in more detail below, to the extent of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of our earnings and profits will be treated first as a non-taxable return of capital to the extent of the U.S. Holder’s tax basis in his common shares on a dollar-for-dollar basis and thereafter as capital gain. Because we are not a U.S. corporation, U.S. Holders that are corporations will generally not be entitled to claim a dividends-received deduction with respect to any distributions they receive from us.

Dividends paid on common shares to a U.S. Holder which is an individual, trust, or estate (a “U.S. Non-Corporate Holder”) will generally be treated as “qualified dividend income” that is taxable to such shareholders at preferential U.S. federal income tax rates provided that (1) the common shares are readily tradable on an established securities market in the United States (such as the Nasdaq Capital Market on which the common shares are currently listed); (2) we are not a passive foreign investment company, or PFIC, for the taxable year during which the dividend is paid or the immediately preceding taxable year (which we do not believe we are or have been, and do not expect to be); (3) the U.S. Non-Corporate Holder has owned the common shares for more than 60 days in the 121-day period beginning 60 days before the date on which the common shares become ex-dividend; and (4) certain other conditions are met.

Any dividends paid by us which are not eligible for these preferential rates will be taxed as ordinary income to a U.S. Holder.

Special rules may apply to any “extraordinary dividend” — generally, a dividend in an amount which is equal to or in excess of 10% of a shareholder’s adjusted basis in a common share — paid by us. If we pay an “extraordinary dividend” on our common shares that is treated as “qualified dividend income,” then any loss derived by a U.S. Non-Corporate Holder from the sale or exchange of such common shares will be treated as long-term capital loss to the extent of such dividend.

Sale, Exchange or other Disposition of Common Shares

Assuming we do not constitute a PFIC for any taxable year, a U.S. Holder generally will recognize taxable gain or loss upon a sale, exchange or other disposition of our common shares in an amount equal to the difference between the amount realized by the U.S. Holder from such sale, exchange or other disposition and the U.S. Holder’s tax basis in such stock. Such gain or loss will be treated as long-term capital gain or loss if the U.S. Holder’s holding period in the common shares is greater than one year at the time of the sale, exchange or other disposition. A U.S. Holder’s ability to deduct capital losses is subject to certain limitations.

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Passive Foreign Investment Company Rules

Special U.S. federal income tax rules apply to a U.S. Holder that holds stock in a foreign corporation classified as a PFIC for U.S. federal income tax purposes. In general, we will be treated as a PFIC with respect to a U.S. Holder if, for any taxable year in which such holder held our common shares, either:


 •
at least 75% of our gross income for such taxable year consists of passive income (e.g., dividends, interest, capital gains and rents derived other than in the active conduct of a rental business); or


•
at least 50% of the average value of the assets held by us during such taxable year produce, or are held for the production of, passive income.

For purposes of determining whether we are a PFIC, we will be treated as earning and owning our proportionate share of the income and assets, respectively, of any of our subsidiary companies in which we own at least 25% of the value of the subsidiary’s stock or other ownership interest. Income earned, or deemed earned, by us in connection with the performance of services should not constitute passive income. By contrast, rental income, which includes bareboat hire, would generally constitute “passive income” unless we are treated under specific rules as deriving rental income in the active conduct of a trade or business.

Based on our current operations and future projections, we do not believe that we are or have been a PFIC during our 2024 taxable year, nor do we expect to become, a PFIC with respect to our 2025 taxable year or any future taxable year. Although there is no legal authority directly on point, our determination is based principally on the position that, for purposes of determining whether we are a PFIC, the gross income we derive or are deemed to derive from the time chartering and voyage chartering activities of our wholly owned subsidiaries should constitute services income, rather than rental income. Correspondingly, we believe that such income does not constitute passive income, and the assets that we or our wholly owned subsidiaries own and operate in connection with the production of such income, in particular the vessels, do not constitute passive assets for purposes of determining whether we are a PFIC. We believe there is substantial legal authority supporting our position consisting of case law and Internal Revenue Service pronouncements concerning the characterization of income derived from time charters and voyage charters as services income. However, there is also authority which characterizes time charter income as rental income rather than services income for other tax purposes. It should be noted that in the absence of any legal authority specifically relating to the statutory provisions governing PFICs, the Internal Revenue Service or a court could disagree with this position. In addition, although we intend to conduct our affairs in a manner so as to avoid being classified as a PFIC with respect to any taxable year, there can be no assurance that the nature of our operations will not change in the future.

As discussed more fully below, if we were to be treated as a PFIC for any taxable year, a U.S. Holder would be subject to different taxation rules depending on whether the U.S. Holder makes an election to treat us as a “Qualified Electing Fund,” which election is referred to as a “QEF election.” As an alternative to making a QEF election, a U.S. Holder should be able to make a “mark-to-market” election with respect to the common shares, as discussed below. In addition, if we were to be treated as a PFIC, a U.S. Holder would be required to file an IRS Form 8621 with respect to such holder’s common shares.

Taxation of U.S. Holders Making a Timely QEF Election

If a U.S. Holder makes a timely QEF election, which U.S. Holder is referred to as an “Electing Holder,” the Electing Holder must report each year for U.S. federal income tax purposes its pro rata share of our ordinary earnings and its net capital gain, if any, for our taxable year that ends with or within the taxable year of the Electing Holder, regardless of whether or not distributions were received from us by the Electing Holder. The Electing Holder’s adjusted tax basis in the common shares will be increased to reflect taxed but undistributed earnings and profits. Distributions of earnings and profits that had been previously taxed will result in a corresponding reduction in the adjusted tax basis in the common shares and will not be taxed again once distributed. An Electing Holder would generally recognize capital gain or loss on the sale, exchange or other disposition of the common shares. A U.S. Holder would make a QEF election with respect to any year that we are a PFIC by filing IRS Form 8621 with his, her or its U.S. federal income tax return. After the end of each taxable year, we will determine whether we were a PFIC for such taxable year. If we determine or otherwise become aware that we are a PFIC for any taxable year, we will use commercially best efforts to provide each U.S. Holder with all necessary information, including a PFIC Annual Information Statement, in order to enable such holder to make a QEF election for such taxable year.

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Taxation of U.S. Holders Making a “Mark-to-Market” Election

Alternatively, if we were to be treated as a PFIC for any taxable year and, as anticipated, our common shares are treated as “marketable stock,” a U.S. Holder would be allowed to make a “mark-to-market” election with respect to our common shares. If that election is made, the U.S. Holder generally would include as ordinary income in each taxable year the excess, if any, of the fair market value of the common shares at the end of the taxable year over such U.S. Holder’s adjusted tax basis in the common shares. The U.S. Holder would also be permitted an ordinary loss in respect of the excess, if any, of the U.S. Holder’s adjusted tax basis in the common shares over its fair market value at the end of the taxable year, but only to the extent of the net amount previously included in income as a result of the mark-to-market election. A U.S. Holder’s tax basis in his common shares would be adjusted to reflect any such income or loss amount. Gain realized on the sale, exchange or other disposition of the common shares would be treated as ordinary income, and any loss realized on the sale, exchange or other disposition of the common shares would be treated as ordinary loss to the extent that such loss does not exceed the net mark-to-market gains previously included by the U.S. Holder.

Taxation of U.S. Holders Not Making a Timely QEF or Mark-to-Market Election

Finally, if we were to be treated as a PFIC for any taxable year, a U.S. Holder who does not make either a QEF election or a “mark-to-market” election for that year, whom we refer to as a “Non-Electing Holder,” would be subject to special rules with respect to (1) any excess distribution (i.e., the portion of any distributions received by the Non-Electing Holder on our common shares in a taxable year in excess of 125 percent of the average annual distributions received by the Non-Electing Holder in the three preceding taxable years, or, if shorter, the Non-Electing Holder’s holding period for the common shares), and (2) any gain realized on the sale, exchange or other disposition of our common shares. Under these special rules:


 •
the excess distribution or gain would be allocated ratably over the Non-Electing Holders’ aggregate holding period for the common shares;


•
the amount allocated to the current taxable year and any taxable year before we became a passive foreign investment company would be taxed as ordinary income; and


•
the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year.

These penalties would not apply to a pension or profit sharing trust or other tax-exempt organization that did not borrow funds or otherwise utilize leverage in connection with its acquisition of our common shares. If a Non-Electing Holder who is an individual dies while owning our common shares, such Non-Electing Holder’s successor generally would not receive a step-up in tax basis with respect to such stock.

Net Investment Income Tax

A U.S. Holder that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax on the lesser of (1) such U.S. Holder’s “net investment income” (or undistributed “net investment income” in the case of estates and trusts) for the relevant taxable year and (2) the excess of such U.S. Holder’s modified adjusted gross income for the taxable year over a certain threshold (which in the case of individuals will be between $125,000 and $250,000, depending on the individual’s circumstances). A U.S. Holder’s net investment income will generally include its gross dividend income and its net gains from the disposition of the common shares, unless such dividends or net gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). Net investment income generally will not include a U.S. Holder’s pro rata share of the Company’s income and gain (if we are a PFIC and that U.S. Holder makes a QEF election, as described above in “— Taxation of U.S. Holders Making a Timely QEF Election”). However, a U.S. Holder may elect to treat inclusions of income and gain from a QEF election as net investment income. Failure to make this election could result in a mismatch between a U.S. Holder’s ordinary income and net investment income. If you are a U.S. Holder that is an individual, estate or trust, you are urged to consult your tax advisor regarding the applicability of the net investment income tax to your income and gains in respect of your investment in our common shares.

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United States Federal Income Taxation of Non-U.S. Holders

Dividends paid to a Non-U.S. Holder with respect to our common shares generally should not be subject to U.S. federal income tax, unless the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base that such holder maintains in the United States).

In addition, a Non-U.S. Holder generally should not be subject to U.S. federal income tax on any gain attributable to a sale or other disposition of our common shares unless such gain is effectively connected with its conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base that such holder maintains in the United States) or the Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the taxable year of sale or other disposition and certain other conditions are met (in which case such gain from United States sources may be subject to tax at a 30% rate or a lower applicable tax treaty rate).

Dividends and gains that are effectively connected with the Non-U.S. Holder’s conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base in the United States) generally should be subject to tax in the same manner as for a U.S. Holder and, if the Non-U.S. Holder is a corporation for U.S. federal income tax purposes, it also may be subject to an additional branch profits tax at a 30% rate or a lower applicable tax treaty rate.

Backup Withholding and Information Reporting

In general, information reporting for U.S. federal income tax purposes should apply to distributions made on our common shares within the United States to a non-corporate U.S. Holder and to the proceeds from sales and other dispositions of our common shares to or through a U.S. office of a broker by a non-corporate U.S. Holder. Payments made (and sales and other dispositions effected at an office) outside the United States will be subject to information reporting in limited circumstances.

In addition, backup withholding of U.S. federal income tax, currently at a rate of 24%, generally should apply to distributions paid on our common shares to a non-corporate U.S. Holder and the proceeds from sales and other dispositions of our common shares by a non-corporate U.S. Holder, who:


 •
fails to provide an accurate taxpayer identification number;


•
is notified by the IRS that backup withholding is required; or


•
fails in certain circumstances to comply with applicable certification requirements.

A Non-U.S. Holder generally may eliminate the requirement for information reporting and backup withholding by providing certification of its foreign status, under penalties of perjury, on a duly executed applicable IRS Form W-8 or by otherwise establishing an exemption.

Backup withholding is not an additional tax. Rather, the amount of any backup withholding generally should be allowed as a credit against a U.S. Holder’s or a Non-U.S. Holder’s U.S. federal income tax liability and may entitle such holder to a refund, provided that certain required information is timely furnished to the IRS.

Individuals who are U.S. Holders (and to the extent specified in applicable Treasury regulations, certain individuals who are Non-U.S. Holders and certain U.S. entities) who hold “specified foreign financial assets” (as defined in Section 6038D of the Code) are required to file IRS Form 8938 with information relating to the asset for each taxable year in which the aggregate value of all such assets exceeds $75,000 at any time during the taxable year or $50,000 on the last day of the taxable year (or such higher dollar amount as prescribed by applicable Treasury regulations). Specified foreign financial assets would include, among other assets, our common shares, unless the shares are held through an account maintained with a U.S. financial institution. Substantial penalties apply to any failure to timely file IRS Form 8938, unless the failure is shown to be due to reasonable cause and not due to willful neglect. Additionally, in the event an individual U.S. Holder (and to the extent specified in applicable Treasury regulations, an individual Non-U.S. Holder or a U.S. entity) that is required to file IRS Form 8938 does not file such form, the statute of limitations on the assessment and collection of U.S. federal income taxes of such holder for the related tax year may not close until three years after the date that the required information is filed. U.S. Holders (including U.S. entities) and Non-U.S. Holders are encouraged to consult their own tax advisors regarding their reporting obligations under this legislation.

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Marshall Islands Tax Consequences

We are incorporated in the Republic of the Marshall Islands. In the opinion of our Marshall Islands tax counsel, Watson Farley & Williams LLP, under current Marshall Islands law, we are not subject to tax on income or capital gains.  No Marshall Islands withholding tax will be imposed upon payment of dividends by us to its shareholders, and holders of our common shares that are not residents of or domiciled or carrying on any commercial activity in the Republic of the Marshall Islands will not be subject to Marshall Islands tax on the sale or other disposition of our common shares.

F.
Dividends and paying agents

Not applicable.

G.
Statement by experts

Not applicable.

H.
Documents on display

We file annual reports and other information with the Commission. Our Commission filings are also available to the public at the website maintained by the Commission at http://www.sec.gov, as well as on our website at www.unitedmaritime.gr. The information contained on, or that can be accessed through, these websites is not incorporated by reference herein and does not form part of this annual report.

I.
Subsidiary information

Not applicable.

J.
ANNUAL REPORT TO SECURITY HOLDERS.

We are currently not required to provide an annual report to security holders in response to the requirements of Form 6-K.

ITEM 11.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We are exposed to risks associated with changes in interest rates relating to our unhedged variable–rate borrowings, according to which we pay interest at a rate of term SOFR plus a margin; as such increases in interest rates could affect our results of operations and ability to service our debt. As of December 31, 2024, we had aggregate variable-rate borrowings of $80.5 million. We have not entered into any hedging contracts to protect against interest rate fluctuations.

The following table sets forth the sensitivity of our existing loans as of December 31, 2024, as to a 100-basis point increase in term SOFR and reflects the additional interest expense.

Year
Amount (in $ thousands)
2025
764
2026
645
2027
398
2028
290
2029
189
2030
85
2031
42
Total
2,413

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Foreign Currency Exchange Rate Risk

We generate all of our revenue in U.S. dollars. Approximately 5% of our operating expenses and half of our general and administration expenses (approximately 53% in 2024) are anticipated to be in currencies other than the U.S. dollar, primarily the Euro. For accounting purposes, expenses incurred in other currencies are converted into U.S. dollars at the exchange rate prevailing on the date of each transaction. We do not consider the risk from exchange rate fluctuations to be material for our results of operations. However, the portion of our business conducted in other currencies could increase in the future, which could expand our exposure to losses arising from exchange rate fluctuations. We have not hedged currency exchange risks associated with our expenses.

ITEM 12.
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable.

PART II

ITEM 13.
DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None.

ITEM 14.
MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

None.

ITEM 15.
CONTROLS AND PROCEDURES

a)
Disclosure Controls and Procedures

Management (our Chief Executive Officer and our Chief Financial Officer) has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, as of the end of the period covered by this annual report (as of December 31, 2024). The term disclosure controls and procedures is defined under the Commission’s rules as controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the 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 Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management (our Chief Executive Officer and our Chief Financial Officer, or persons performing similar functions) as appropriate to allow timely decisions regarding required disclosure. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.

Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures are effective as of the evaluation date.

b)
Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is identified in Exchange Act Rule 13a-15(f). Our internal control over financial reporting is a process designed under the supervision of our Chief Executive Officer and our Chief Financial Officer and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external reporting purposes in accordance with U.S. GAAP.

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Internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that receipts and expenditures are being made only in accordance with the authorization of our management and directors; and (iii) 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 consolidated financial statements.

Management (our Chief Executive Officer and our Chief Financial Officer), has assessed the effectiveness of our internal control over financial reporting as of December 31, 2024, based on the framework established in Internal Control - Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management has determined that the Company's internal control over financial reporting is effective as of December 31, 2024.

However, it should be noted that because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements with certainty even when determined to be effective and can only provide reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate / obsolete because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

c)
Attestation Report of the Registered Public Accounting Firm

This annual report does not include an attestation report of the Company’s registered public accounting firm because as an emerging growth company, we are exempt from this requirement.

d)
Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the year covered by this annual report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 16.
[Reserved]

ITEM 16A.
AUDIT COMMITTEE FINANCIAL EXPERT

Our board of directors has determined that Christina Anagnostara, an independent director, chairman and a member of our audit committee, is an “Audit Committee Financial Expert” under Commission rules and the corporate governance rules of the Nasdaq Stock Market.

ITEM 16B.
CODE OF ETHICS

We have adopted a Code of Business Conduct and Ethics that applies to our employees, officers and directors. Our Code of Business Conduct and Ethics is available on our website at www.unitedmaritime.gr. Information on our website does not constitute a part of this annual report and is not incorporated by reference. We will also provide a hard copy of our Code of Business Conduct and Ethics free of charge upon written request. We intend to disclose any waivers to or amendments of the Code of Business Conduct and Ethics for the benefit of any of our directors and executive officers within 5 business days of such waiver or amendment. Shareholders may direct their requests to the attention of Investor Relations, United Maritime Corporation, 154 Vouliagmenis Avenue, 16674 Glyfada, Greece, telephone number +30 213 0181507 or facsimile number +30 210 9638404.

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ITEM 16C.
PRINCIPAL ACCOUNTANT FEES AND SERVICES

Our principal accountants are Ernst & Young (Hellas) Certified Auditors Accountants S.A. Audit, audit-related and non-audit services billed and accrued from Ernst & Young (Hellas) Certified Auditors Accountants S.A. are as follows:

   
2024
    
2023
  
Audit fees
  
$
197,000
    
$
193,000
  
Audit related fees
  

13,000
    

26,000
  
Tax fees
    
-
      
-
  
All other fees
    
-
      
-
  
Total fees
  
$
210,000
    
$
219,000
  

Audit fees for 2024 related to professional services rendered for the audit of our financial statements of United Maritime Corporation for the year ended December 31, 2024. Audit fees for 2023 related to professional services rendered for the audit of our financial statements of United Maritime Corporation for the year ended December 31, 2023. As per the audit committee charter, our audit committee pre-approves all audit, audit-related and non-audit services not prohibited by law to be performed by our independent registered public accounting firm and associated fees prior to the engagement of the independent registered public accounting firm with respect to such services. Our audit committee has adopted a policy which sets forth the procedures and the conditions pursuant to which services proposed to be performed by the independent auditors are to be pre-approved.

ITEM 16D.
EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

ITEM 16E.
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Month
  
Total
Number of
Shares (or Units)
Purchased
    
Average
Price Paid
per Share
(or Units)
    
Total Number of
Shares (or Units)
Purchased as Part
of Publicly Announced
Plans or Programs
    
Maximum Number (or
Approximate Dollar Value)
of Shares (or Units)
that May Yet Be Purchased
Under the Plans or Programs
  
January 1-31, 2024
  
17,174
    
$
2.51
      
17,174
    
$
2,286,553
  
August 1-31, 2024
  
114,705
    
$
2.52
      
114,705
    
$
1,998,893
  
September 1-30, 2024
  
53,484
    
$
2.58
      
53,484
    
$
1,861,724
  

In addition, the Company’s Chairman and Chief Executive Officer acquired, in 2025, until April 9, 2025, a total of 115,622 common shares in the open market for an aggregate purchase price of approximately $0.2 million.

In October 2022, our board of directors authorized a share buyback plan pursuant to which we may have repurchased up to $3.0 million of our outstanding common shares in the open market. This plan was set to expire on December 31, 2024 and on December 17, 2024, the Company authorized the extension for a further 12-month period. As of April 7, 2025, we have repurchased 450,176 common shares for an aggregate purchase price of approximately $1.1 million pursuant to this buyback plan. The maximum value of shares that may yet be purchased under our buyback plan as of April 7, 2025 was $1.9 million.

ITEM 16F.
CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

None.

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ITEM 16G.
CORPORATE GOVERNANCE

As a foreign private issuer, as defined in Rule 3b-4 under the Exchange Act, the Company is permitted to follow certain corporate governance rules of its home country in lieu of Nasdaq’s corporate governance rules. The Company’s corporate governance practices deviate from Nasdaq’s corporate governance rules in the following ways:


 •
In lieu of obtaining shareholder approval prior to the issuance of designated securities or the adoption of equity compensation plans or material amendments to such equity compensation plans, we will comply with provisions of the BCA, providing that the board of directors approves share issuances and adoptions of and material amendments to equity compensation plans. Likewise, in lieu of obtaining shareholder approval prior to the issuance of securities in certain circumstances, consistent with the BCA and our amended and restated articles of incorporation and second amended and restated bylaws, the board of directors approves certain share issuances.


•
The Company’s board of directors is not required to have an Audit Committee comprised of at least three members. Our Audit Committee is comprised of two members.


•
The Company’s board of directors is not required to meet regularly in executive sessions without management present.


•
As a foreign private issuer, we are not required to solicit proxies or provide proxy statements to Nasdaq pursuant to Nasdaq corporate governance rules or Marshall Islands law. Consistent with Marshall Islands law and as provided in our second amended and restated bylaws, we will notify our shareholders of meetings between 15 and 60 days before the meeting. This notification will contain, among other things, information regarding business to be transacted at the meeting.

Other than as noted above, we are in full compliance with all other applicable Nasdaq corporate governance standards.

ITEM 16H.
MINE SAFETY DISCLOSURE

Not applicable.

ITEM 16I.
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

ITEM 16J.
INSIDER TRADING POLICIES

Our Board of Directors has adopted the “Statement of Company Policy – Trading in the Company’s Securities” in relation to policies and procedures to detect and prevent insider trading (“Insider Trading Policy”) governing the purchase, sale, and other dispositions of our securities by directors, senior management, and employees that are reasonably designed to promote compliance with applicable insider trading laws, rules and regulations, and any listing standards applicable to us. A copy of our Insider Trading Policy has been filed as Exhibit 11.1 to our annual report on Form 20-F for the fiscal year ended December 31, 2023, filed with the SEC on April 2, 2024.

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ITEM 16K.
CYBERSECURITY


We believe that cybersecurity is fundamental in our operations and, as such, we are committed to maintaining robust governance and oversight of cybersecurity risks and to implementing comprehensive processes and procedures for identifying, assessing, and managing material risks from cybersecurity threats as part of our broader risk management system and processes. Our cybersecurity risk management strategy prioritizes detection, analysis and response to known, anticipated or unexpected threats; effective management of security risks; and resiliency against incidents. With the ever-changing cybersecurity landscape and continual emergence of new cybersecurity threats, our board of directors and senior management team ensure that adequate resources are devoted to cybersecurity risk management and the technologies, processes and people that support it. We implement risk-based controls to protect our information, the information of our customers, suppliers, and other third parties, our information systems, our business operations, and our vessels.


As part of our cybersecurity risk management system, our information and technology management team is comprised of a senior IT professional, leading an appropriately staffed information and technology department, having extensive experience and expertise on all information and technology matters, including cybersecurity. To this end, our information and technology management team tracks and logs privacy and security incidents across our Company, our vessels, our customers, suppliers and other third-party service providers to remediate and resolve any such incidents. Significant incidents are reviewed regularly by our information and technology management team to determine whether further escalation is appropriate. We also engage annually third parties, such as specialized assessors and consultants, as well as our internal audit department, to audit our information security systems, whose findings are reported to our senior management team. Any identified incident assessed as potentially being or potentially becoming material is immediately escalated for further assessment, and then reported to our senior management team who is responsible to assess its overall materiality in due time and decide whether further reference to our board of directors is necessary. We further consult with outside counsel as appropriate, including on materiality analysis and disclosure requirements, and our senior management, in cooperation if required with our board of directors, makes the final materiality determinations and disclosure and other compliance decisions.


As we do not have a dedicated board committee solely focused on cybersecurity, our senior management team has oversight responsibility for risks and incidents relating to cybersecurity threats, including compliance with disclosure requirements, cooperation with law enforcement, and related effects on financial and other risks, and it reports any material findings and recommendations, as appropriate, to our board of directors for consideration.


Overall, our approach to cybersecurity risk management includes the following key elements:


 (i)
Continuous monitoring of cybersecurity threats, both internal and external. through the use of data analytics and network monitoring systems.



(ii) Engagement of third party consultants and other advisors to assist in assessing points of vulnerability of our information security systems.



(iii)
Overall assessment of cybersecurity incidents materiality and potential impact on the company’s operations and financial condition by our senior management team and our board of directors, in cooperation, if considered necessary, with specialized external consultants.



(iv)
Oversight responsibility of cybersecurity risks and compliance with relevant disclosure requirements lies with our senior management team and our board of directors.



(v)
Training and Awareness – we have various information technology policies relating to cybersecurity. We also provide employee mandatory training that is administered on a periodic basis that reinforces our information technology policies, standards and practices, as well as the expectation that employees comply with these policies and identify and report potential cybersecurity risks. We also require employees to sign confidentiality agreements, where appropriate to their role.


We continue to invest in our cybersecurity systems and to enhance our internal controls and processes. Our business strategy, results of operations and financial condition have not been materially affected by risks from cybersecurity threats, including as a result of previously identified cybersecurity incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks or any future material incidents. While we have dedicated appropriate resources to identifying, assessing, and managing material risks from cybersecurity threats, our efforts may not be adequate, may fail to accurately assess the severity of an incident, may not be sufficient to prevent or limit harm, or may fail to sufficiently remediate an incident in a timely fashion, any of which could harm our business, reputation, results of operations and financial condition. For more information certain risks associated with cybersecurity, see “Item 3.D. Risk Factors—Company-Specific Risk Factors—A cyber-attack could materially disrupt our business.”

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PART III

ITEM 17.
FINANCIAL STATEMENTS

See Item 18.

ITEM 18.
FINANCIAL STATEMENTS

The financial information required by this item, together with the reports of Ernst & Young (Hellas) Certified Auditors Accountants S.A., are set forth on pages F-1 through F-39 and F-1 through F-18 and are filed as part of this annual report.

ITEM 19.
EXHIBITS

Exhibit
Number
  
Description
 
Amended and Restated Articles of Incorporation of the Company (incorporated by reference to Exhibit 1.1 to the Company’s Registration Statement on Form 20-F filed with the Commission on June 6, 2022)
     
 
Second Amended and Restated Bylaws of the Company (incorporated by reference to Exhibit 1.1 to the Company’s Report on Form 6-K filed with the Commission on December 27, 2023)
     
 
Form of Common Share Certificate (incorporated by reference to Exhibit 2.1 to the Company’s Registration Statement on Form 20-F filed with the Commission on June 6, 2022)
     
 
Statement of Designation of the Series A Participating Preferred Stock of the Company (incorporated by reference to Exhibit 2.2 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Statement of Designation of the Series B Preferred Shares of the Company (incorporated by reference to Exhibit 2.3 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Description of Securities*
     
 
Amended and Restated Shareholders’ Rights Agreement dated as of December 27, 2023 (incorporated by reference to Exhibit 4.1 to the Company’s Report on Form 6-K filed with the Commission on December 27, 2023)
     
 
  
Amendment to the Amended and Restated Shareholders’ Rights Agreement dated as of April 1, 2024 (incorporated by reference to Exhibit 4.2 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
  
Amended and Restated Equity Incentive Plan of the registrant dated April 7, 2025*
     
 
Right of First Refusal Agreement by and between the Company and Seanergy Maritime Holdings Corp. (incorporated by reference to Exhibit 10.3 to the Company’s Registration Statement on Form F-1 filed with the Commission on July 12, 2022)
     
 
Contribution and Conveyance Agreement by and between the Company and Seanergy Maritime Holdings Corp. (incorporated by reference to Exhibit 10.4 to the Company’s Registration Statement on Form F-1 filed with the Commission on July 12, 2022)
     
 
Master Management Agreement by and between the Company and Seanergy Maritime Holdings Corp. (incorporated by reference to Exhibit 10.5 to the Company’s Registration Statement on Form F-1 filed with the Commission on July 12, 2022)

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​
Form of Technical Management Agreement with Seanergy Shipmanagement Corp. (incorporated by reference to Exhibit 4.6 to the Company’s Registration Statement on Form 20-F filed with the Commission on June 6, 2022)
 
​
  
​
Form of Technical Management Agreement with V.Ships Limited (incorporated by reference to Exhibit 4.7 to the Company’s Annual Report on Form 20-F filed with the Commission on April 4, 2023)
     
 
Novation Agreement with V.Ships Limited and V.Ships Greece for the M/V Tradership with respect to the Technical Management Agreement with V.Ships Limited*
     
 
Form of Ship Technical Management Agreement with V.Ships Greece for the M/V Exelixsea*
     
 
Form of Addendum to Technical Management Agreement with V. Ships Greece in relation to emissions scheme obligations for the M/V Exelixsea and M/V Tradership*
     
 
Form of Guarantee in respect of the M/V Exelixsea and M/V Tradership between the registrant and V. Ships Greece in relation to emission scheme obligations*
     
 
Commercial Management Agreement between United Management Corp. and Seanergy Management Corp. dated April 5, 2023 (incorporated by reference to Exhibit 4.9 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
 
​
  
​
Commercial Management Agreement between United Management Corp. and Fidelity Marine Inc. dated April 5, 2023 (incorporated by reference to Exhibit 4.10 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
 
​
  
​
Form of Services Agreement with United Management Corp. (incorporated by reference to Exhibit 4.11 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
 
​
  
​
Form of Securities Purchase Agreement between United Maritime Corporation and certain purchasers thereto (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 6-K filed with the Commission on July 21, 2022)
     
 
Warrant Agency Agreement dated July 19, 2022 between United Maritime Corporation and American Stock Transfer & Trust Company, LLC (incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 6-K filed with the Commission on July 21, 2022)
     
 
Form of Class A Share Purchase Warrant (incorporated by reference to Exhibit 4.5 to the Company’s Current Report on Form 6-K filed with the Commission on July 21, 2022)
     
 
Bareboat Charter Agreement dated April 12, 2023 between NML Cretansea LLC and Cretansea Maritime Co. for the M/V Cretansea (incorporated by reference to Exhibit 4.20 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Guarantee in respect of the M/V Cretansea dated April 12, 2023 between NML Trustee LLC and United Maritime Corporation (incorporated by reference to Exhibit 4.21 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Guarantee in respect of the M/V Cretansea dated April 12, 2023 between NML Trustee LLC and Oasea Maritime Co. (incorporated by reference to Exhibit 4.22 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Amendment Agreement dated March 22, 2024 to a Bareboat Charter dated April 12, 2023 in relation to the M/V Cretansea (incorporated by reference to Exhibit 4.23 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)

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Bareboat Charter Agreement dated November 15, 2023 between Giant 4 Holding Limited and Traders Maritime Co. for the M/V Tradership (incorporated by reference to Exhibit 4.25 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Guarantee in respect of the M/V Tradership dated November 15, 2023 between Giant 4 Holding Limited and United Maritime Corporation (incorporated by reference to Exhibit 4.26 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Bareboat Charter Agreement dated November 15, 2023 between Giant 5 Holding Limited and Good Maritime Co. for the M/V Goodship (incorporated by reference to Exhibit 4.27 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Guarantee in respect of the M/V Goodship dated November 15, 2023 between Giant 5 Holding Limited and United Maritime Corporation (incorporated by reference to Exhibit 4.28 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Bareboat Charter Agreement dated November 15, 2023 between Giant 6 Holding Limited and Sea Glorius Shipping Co. for the M/V Gloriuship (incorporated by reference to Exhibit 4.29 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Guarantee in respect of the M/V Gloriuship dated November 15, 2023 between Giant 6 Holding Limited and United Maritime Corporation (incorporated by reference to Exhibit 4.30 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Bareboat Charter Agreement dated February 22, 2024 between Exelixsea Maritime Co. and Village Seven Co., Ltd and V7 Fune Inc. for the M/V Exelixsea (incorporated by reference to Exhibit 4.31 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Guarantee in respect of the M/V Exelixsea dated February 22, 2024 issued by United Maritime Corporation (incorporated by reference to Exhibit 4.32 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Bareboat Charter Agreement dated March 6, 2024 between Basic Eternity Line S.A. and Nisea Maritime Co. for the M/V Scarlet Robin (tbr Nisea) (incorporated by reference to Exhibit 4.33 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
   
 
Bareboat Charterparty dated July 24, 2024, between Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A. and Synthesea Maritime Co. for the M/V Synthesea*
     
 
Addendum No.1 to the Bareboat Charterparty dated July 24, 2024, between Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A. and Synthesea Maritime Co. for the M/V Synthesea*
     
 
Addendum No.2 to the Bareboat Charterparty dated July 24, 2024, between Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A. and Synthesea Maritime Co. for the M/V Synthesea*
     
 
Guarantee in respect of the M/V Synthesea dated July 24, 2024, of the registrant in favor of Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A.*

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Shareholders’ Agreement dated July 31, 2024 between RGI Marine Ltd, Steady Offshore Shipping Pte Ltd, United Maritime Corporation, Karean AS and Jonathan Elkington*
     
 
Subscription Agreement dated July 31, 2024 between RGI Marine Ltd, Steady Offshore Shipping Pte Ltd, United Maritime Corporation, Karean AS and Jonathan Elkington*
     
4.38

Facility Agreement dated August 5, 2024, between Chrisea Maritime Co., United Maritime Corporation and Sinopac Capital International (HK) Limited for the M/V Chrisea*
     
​
List of Subsidiaries*
     
 
Statement of Company Policy – Trading in the Company’s Securities (incorporated by reference to Exhibit 11.1 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
 
Rule 13a-14(a)/15d-14(a) Certification of the Company’s Principal Executive Officer*
     
 
Rule 13a-14(a)/15d-14(a) Certification of the Company’s Principal Financial Officer*
     
 
Certification of the Company’s Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
     
 
Certification of the Company’s Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
     
 
Consent of Ernst & Young (Hellas) Certified Auditors-Accountants S.A.*
     
 
Consent of Ernst & Young (Hellas) Certified Auditors-Accountants S.A.*
     
15.3
 		 

Consent of Watson Farley & Williams LLP*
     
 
Policy for the Recovery of Erroneously Awarded Incentive Compensation of the Company (incorporated by reference to Exhibit 97.1 to the Company’s Annual Report on Form 20-F filed with the Commission on April 2, 2024)
     
101
  
The following materials from the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, formatted in Inline eXtensible Business Reporting Language (iXBRL): (i) Reports of Independent Registered Public Accounting Firm (PCAOB ID 1457), (ii) Consolidated Balance Sheets as of December 31, 2024, 2023 and 2022, (iii) Consolidated Statement of Operations for the year ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022, (iv) Consolidated Statement of Stockholders' Equity for the year ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022, (v) Consolidated Statement of Cash Flows for the year ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022, (vi) Notes to Consolidated Financial Statements, (vii) Report of Independent Registered Public Accounting Firm (PCAOB ID 1457), (viii) Carve-out Balance Sheet as of December 31, 2021 (ix) Carve-out Statements of Operations for the period from January 1, 2022 through July 5, 2022 and for the year ended December 31, 2021, (x) Carve-out Statements of Parent’s Equity for the period from January 1, 2022 through July 5, 2022 and for the year ended December 31, 2021, (xi) Carve-out Statements of Cash Flows for the period from January 1, 2022 through July 5, 2022 and for the year ended December 31, 2021, and (xii) Notes to the Carve-out Financial Statements.*
     
104
  
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)*

*
Filed herewith

97
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SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

 
United Maritime Corporation
 
​
  
 
By:
/s/ Stamatios Tsantanis
  
 
Name:
Stamatios Tsantanis
 
Title:
Chief Executive Officer
     
Date: April 10, 2025
    

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

 
Page
   
F-2
   
F-3
   
F-4
   
Consolidated Statements of Other Comprehensive (Loss) / Income for the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022 F-5
   
F-6
   
F-7
   
F-8

F-1
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of United Maritime Corporation.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of United Maritime Corporation (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, the consolidated statements of other comprehensive (loss) / income, stockholders' equity and cash flows for each of the two years in the period ended December 31, 2024 and for the period from inception (January 20, 2022) through December 31, 2022, 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 at 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 and for the period from inception (January 20, 2022) through December 31, 2022, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (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. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

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.

/s/ Ernst & Young (Hellas) Certified Auditors Accountants S.A.

We have served as the Company’s auditor since 2021.

Athens, Greece
April 10, 2025

F-2
Table of Contents
United Maritime Corporation
Consolidated Balance Sheets
December 31, 2024 and 2023
(In thousands of US Dollars, except for share and per share data)

   
Notes
    
2024
     2023  
ASSETS
                  
Current assets:
                  
Cash and cash equivalents
    
4
      
6,412
       13,801  
Accounts receivable trade
    
2, 12
      
1,437
       252  
Due from related parties
    3
       -
       142  
Inventories
     2
      
650
       664  
Prepaid expenses
            
601
       546  
Vessel held for sale
     5
       14,880       -  
Other current assets
     2      
503
       3,685  
Total current assets
            
24,483
       19,090  
                         
Fixed assets:
                        
Vessels, net
    
5
      
110,589
       104,819  
Right-of-use assets
    6
       27,560       47,706  
Total fixed assets
            
138,149
       152,525  
                         
Other non-current assets:
                        
Restricted cash, non-current
    
4
      
350
       700  
Other non-current assets
     7
       1,155       -  
Equity method investment
     3, 8
       3,588       -  
Deferred charges and other investments, non-current
     2
      
4,348
       2,490  
TOTAL ASSETS
            
172,073
       174,805  
                         
LIABILITIES AND STOCKHOLDERS’ EQUITY
                        
Current liabilities:
                        
Current portion of long-term debt and other financial liabilities, net of deferred finance costs and debt discounts of $723 and $566, respectively
    
7
      
17,650
       8,691  
Finance lease liabilities, current
    6
       2,032       31,420  
Due to related parties
    
3
      
7,271
       450  
Trade accounts and other payables
            
1,823
       3,308  
Accrued liabilities
            
2,682
       8,045  
Deferred revenue
     12
      
1,395
       527  
Dividends payable
    
11
      
663
       652  
Total current liabilities
            
33,516
       53,093  
                         
Non-current liabilities:
                        
Long-term debt and other financial liabilities, net of current portion and deferred finance costs and debt discounts of $989 and $742, respectively
    
7
      
61,103
       55,843  
Finance lease liabilities, non-current
      6       16,938       -  
Other liabilities, non-current
            
428
       -  
Total liabilities
            
111,985
       108,936  
                         
Commitments and contingencies
     10
       -       -  
                         
STOCKHOLDERS’ EQUITY
                        
Preferred stock, $0.0001 par value; 100,000,000 shares authorized; 40,000 Series B preferred shares issued and outstanding as at December 31, 2024 and 2023, respectively
     11
      
-
       -  
Common stock, $0.0001 par value; 2,000,000,000 authorized shares as at December 31, 2024 and 2023; 8,844,267 and 8,694,630 shares issued and outstanding as at December 31, 2024 and 2023, respectively
     11
      
1
       1  
Additional paid-in capital
    
11
      
39,176
       38,916  
Accumulated other comprehensive loss
             (4 )     -  
Retained earnings
            
20,915
       26,952  
Total stockholders’ equity
            
60,088
       65,869  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
            
172,073
       174,805  

The accompanying notes are an integral part of these consolidated financial statements.

F-3
Table of Contents
United Maritime Corporation
 Consolidated Statement of Operations
For the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022
(In thousands of US Dollars, except for share and per share data)

   
Notes
    
2024
     2023     2022  
                         
Vessel revenue, net
    
2, 3, 12
      
45,439
       36,067       22,784  
Expenses:
                                
Voyage expenses
     12
     
(1,771
)
     (3,107 )     (5,245 )
Vessel operating expenses
            
(19,745
)
     (20,338 )     (5,179 )
Management fees
            
(522
)
     (545 )     (241 )
Management fees – related party
     3
      
(1,741
)
     (1,421 )     (285 )
General and administration expenses
    
15
      
(4,010
)
     (6,018 )     (5,524 )
Depreciation and amortization
     5
      
(9,713
)
     (9,078 )     (1,903 )
Amortization of deferred dry-docking costs
             (3,717 )     (285 )     -  
Impairment loss
     5
      (828 )     -       -  
Gain on sale of vessels, net
    
5
      
1,426
       11,804       36,095  
Operating income
    
     
4,818
       7,079       40,502  
Other income / (expenses), net:
                                
Interest and finance costs
    
13
      
(8,416
)
     (7,183 )     (2,452 )
Loss on extinguishment of debt
    
7
      
(397
)
     (85 )     (593 )
Interest income
            
314
       430       13  
Loss on equity method investment
     8
       (142 )     -       -  
Other income
             311       112       26  
Foreign currency exchange losses, net
            
129
       (132 )     (6 )
Total other expenses, net
            
(8,201
)
     (6,858 )     (3,012 )
Net (loss) / income
            
(3,383
)
     221       37,490  
Dividends on Series C preferred shares
    
11
      
-
       -       (743 )
Dividends to non-vested participating securities
     14      
-
       (95 )     (667 )
Undistributed earnings to non-vested participating securities
     14
       -       -       (994 )
Net (loss) / income attributable to common stockholders
            
(3,383
)
     126       35,086  
                                 
Net (loss) / income per common share, basic
    
14
      
(0.39
)
     0.02       7.79  
Net (loss) / income per common share, diluted
    
14
      
(0.39
)
     0.02       4.92  
                                 
Weighted average common shares outstanding, basic
    
14
      
8,711,951
       8,359,487       4,503,397  
Weighted average common shares outstanding, diluted
    
14
      
8,711,951
       8,359,487       7,299,561  

The accompanying notes are an integral part of these consolidated financial statements.

F-4
Table of Contents
United Maritime Corporation
 Consolidated Statement of Other Comprehensive (Loss) / Income
For the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022
(In thousands of US Dollars, except for share and per share data)

   
2024
    
2023
     2022  
                   
Net (loss) / income
     (3,383 )     221       37,490  
Other comprehensive loss:
                        
Foreign currency translation differences from equity method investment
     (4 )     -       -  
Other comprehensive loss
     (4 )     -       -  
Total comprehensive (loss) / income
     (3,387 )     221       37,490  

The accompanying notes are an integral part of these consolidated financial statements.
F-5
Table of Contents
United Maritime Corporation
Consolidated Statements of Stockholders’ Equity
For the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022
 (In thousands of US Dollars, except for share data)

   
Preferred stock Series B
    
Preferred stock Series C
    
Common stock
     Additional    
Accumulated
other
   
    Total  
   
# of
Shares
    
Par
Value
    
# of
Shares
    
Par
Value
    
# of
Shares
    
Par
Value
    
paid-in
capital
     comprehensive loss
    
Retained
earnings
    
stockholders’
equity
  
                                                             
Balance, January 20, 2022
    
-
      
-
      
-
      
-
      
500
      
-
      
-
    
-      
-
      
-
  
Spin-off transaction (Note 3)
     40,000       -       5,000       -       1,512,004       -       18,728    
-       -       18,728  
Issuance of common stock (including exercise of warrants) (Note 11)
    
-
      
-
      
-
      
-
      
8,258,030
      
1
      
24,679
    
-      
-
      
24,680
  
Cancellation of common stock (Note 11)
    
-
      
-
      
-
      
-
      
(500
)
    
-
      
-
    
-      
-
      
-
  
Issuance of preferred stock (Notes 3 & 11)
    
-
      
-
      
5,000
      
-
      
-
      
-
      
5,000
    
-      
-
      
5,000
  
Repurchase of common stock (Note 11)
    
-
      
-
      
-
      
-
      
(3,289,791
)
    
-
      
(6,003
)
  
-      
-
      
(6,003
)
Dividends on common stock and participating non vested restricted stock awards (Note 11)
    
-
      
-
      
-
      
-
      
-
      
-
      
-
    
-      
(7,373
)
    
(7,373
)
Dividends on Series C preferred shares (Note 11)
    
-
      
-
      
-
      
-
      
-
      
-
      
-
    
-      
(243
)
    
(243
)
Redemption of Series C preferred shares (Note 11)
    
-
      
-
      
(10,000
)
    
-
      
-
      
-
      
(10,000
)
  
-      
(500
)
    
(10,500
)
Stock based compensation (Note 15)
    
-
      
-
      
-
      
-
      
1,700,000
      
-
      
2,789
    
-      
-
      
2,789
  
Net income
    
-
      
-
      
-
      
-
      
-
      
-
      
-
    
-      
37,490
      
37,490
  
Balance, December 31, 2022
    
40,000
      
-
      
-
      
-
      
8,180,243
      
1
      
35,193
    
-      
29,374
      
64,568
  
Issuance of common stock (including exercise of warrants) (Note 11)
    -       -       -       -       779,200       -       1,874    
-       -       1,874  
Repurchase of common stock (Note 11)
    -       -       -       -       (264,813 )     -       (673 )  
-       -       (673 )
Dividends on common stock and participating non vested restricted stock awards (Note 11)
    -       -       -       -       -       -       -    
-       (2,643 )     (2,643 )
Stock based compensation (Note 15)
    -       -       -       -       -       -       2,522    
-       -       2,522  
Net income
     -       -       -       -       -       -       -    
-       221       221  
Balance, December 31, 2023
    40,000       -       -       -       8,694,630       1       38,916    
-       26,952       65,869  
Issuance of common stock (including exercise of warrants)
     -       -       -       -       -       -       (50 )  
-       -       (50 )
Repurchase of common stock (Note 11)
     -       -       -       -       (185,363 )     -       (469 )  
-       -       (469 )
Dividends on common stock and participating non vested restricted stock awards (Note 11)
     -       -       -       -       -       -       -    
-       (2,654 )     (2,654 )
Stock based compensation (Note 15)
     -       -       -       -       335,000       -       779    
-       -       779  
Foreign currency translation
     -       -       -       -       -       -       -    
(4 )     -       (4 )
Net loss
     -       -       -       -       -       -       -    
-       (3,383 )     (3,383 )
Balance, December 31, 2024
     40,000       -       -       -       8,844,267       1       39,176    
(4 )     20,915       60,088  

The accompanying notes are an integral part of these consolidated financial statements.

F-6
Table of Contents
United Maritime Corporation
Consolidated Statements of Cash Flows
For the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022
(In thousands of US Dollars)

   
2024
     2023     2022
  
Cash flows from operating activities:
                  
Net (loss) / income    
(3,383
)
     221       37,490  
Adjustments to reconcile net (loss) / income to net cash from operating activities:
                        
Depreciation and amortization
    
9,713
       9,078       1,903  
Amortization of deferred dry-docking costs
     3,717       285       -  
Amortization of deferred finance costs and debt discounts
    
727
       781       352  
Amortization of fair value of above market time charter
    
-
       -       308  
Amortization of fair value of below market time charter
    
-
       -       (146 )
Stock based compensation
    
779
       2,522       2,789  
Loss on equity method investment
     142       -       -  
Loss on extinguishment of debt
    
151
       68       593  
Impairment loss
     828       -       -  
Gain on sale of vessels, net
    
(1,426
)
     (11,804 )     (36,095 )
Changes in operating assets and liabilities:
                        
Accounts receivable trade
    
(1,185
)
     527       (660 )
Inventories
    
(82
)
     (531 )     87  
Prepaid expenses
    
(55
)
     443       (990 )
Other current assets
    
3,182
       (478 )     (3,207 )
Due from related parties
    142       (142 )     -  
Deferred charges, non-current
    
(6,580
)
     (5,519 )     (58 )
Trade accounts and other payables
    
(1,762
)
     (1,566 )     (2,787 )
Accrued liabilities
    
(4,979
)
     1,142       6,804  
Other current liabilities
     -       -       (130 )
Due to related parties
    
2,467
       (755 )     595  
Deferred revenue
    
868
       (500 )     1,027  
Net cash provided by / (used in) operating activities
    
3,264
       (6,228 )     7,875  
Cash flows from investing activities:
                        
Vessels acquisitions and improvements
    
(249
)
     (81,748 )     (80,832 )
Advances for vessels acquisitions from related parties
    
-
       -       (12,688 )
Lease prepayments and other initial direct costs
     (8,288 )     (14,890 )     -  
Equity method investment
     (3,734 )     -       -  
Gross proceeds from sale of vessel
    
20,220
       37,500       100,008  
Net cash provided by / (used in) investing activities
    
7,949
       (59,138 )     6,488  
Cash flows from financing activities:
                        
Proceeds from issuance of common stock and warrants, net of underwriters fees and commissions
    
-
       1,883       24,974  
Due to related parties
     4,411       -       -  
Proceeds from issuance of preferred stock
    
-
       -       10,000  
Redemption of preferred stock
    
-
       -       (10,500 )
Dividends on preferred stock
    
-
       -       (243 )
Payments for repurchase of common stock
    
(469
)
     (673 )     (6,003 )
Proceeds from long-term debt and other financial liabilities
    
47,145
       54,500       73,000  
Payments of financing and stock issuance costs
    
(1,617
)
     (1,801 )     (909 )
Dividends paid
    (2,643 )     (9,364 )     -  
Payments of finance lease liabilities
     (32,102 )     (2,752 )     -  
Repayments of long-term debt and other financial liabilities
    
(33,677
)
     (31,858 )     (34,750 )
Net cash (used in) / provided by financing activities
    
(18,952
)
     9,935       55,569  
Net (decrease) / increase in cash and cash equivalents and restricted cash
    
(7,739
)
     (55,431 )     69,932  
Cash and cash equivalents and restricted cash at beginning of period
    
14,501
       69,932       -  
Cash and cash equivalents and restricted cash at end of period
    
6,762
       14,501       69,932  
                         
SUPPLEMENTAL CASH FLOW INFORMATION
                        
Cash paid during the period for:
                        
Interest
    
7,599
       6,335       1,741  
Deposit
     1,155       -       -  
                         
Noncash investing activities:
                        
Vessel acquisition through spin-off
    
-
       -       (18,500 )
Vessels’ improvements and acquisitions
    (62 )     (232 )     -  
Right-of use assets and initial direct costs
    (20,221 )     (34,792 )     -  
                         
Noncash financing activities:
                        
Dividends on common stock and participating non vested restricted stock awards declared but not paid (Note 11)
     (663 )     (652 )     (7,373 )
Long-term debt assumed through spin-off
    
-
       -       4,950  
Payments of financing and stock issuance stocks     -       (194 )     (833 )

The accompanying notes are an integral part of these consolidated financial statements.

F-7
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)

1.
Basis of Presentation and General Information:

United Maritime Corporation (the “Company” or “United”) was incorporated by Seanergy Maritime Holdings Corp. (“Seanergy” or “Parent”) on January 20, 2022 under the laws of the Republic of the Marshall Islands, having an initial share capital of 500 registered shares, of no par value, issued to the Parent. The Company completed the spin-off from Seanergy effective July 5, 2022. United’s common shares are listed on the Nasdaq Capital Market and began trading on July 6, 2022 under the symbol “USEA”. The Company is engaged in the ocean transportation of cargoes worldwide through the ownership and operation of dry-bulk vessels.

The accompanying consolidated financial statements include the accounts of United and its subsidiaries.

The consolidated financial statements have been prepared assuming that the Company will continue as a going concern. Accordingly, they do not include any adjustments that might result in the event that the Company is unable to continue as a going concern.

a.
Subsidiaries in Consolidation:

United’s subsidiaries included in these consolidated financial statements as of December 31, 2024:

Company
  
Country of
Incorporation
  
Vessel name
  
Date of Delivery
  
Date of
Sale/Disposal
United Management Corp. (1)(2)
  
Marshall Islands
  
N/A
  
N/A
  
N/A
Sea Glorius Shipping Co. (1)(3)
  
Marshall Islands
  
Gloriuship
  
July 6, 2022
  
December 5, 2023
Epanastasea Maritime Co. (1)
  
Marshall Islands
  
Epanastasea
  
September 2, 2022
  
August 10, 2023
Parosea Shipping Co. (4)
  
Marshall Islands
  
Parosea
  
August 10, 2022
  
November 8, 2022
Bluesea Shipping Co. (4)
  
Marshall Islands
  
Bluesea
  
August 12, 2022
  
December 1, 2022
Minoansea Maritime Co. (1)
  
Marshall Islands
  
Minoansea
  
August 30, 2022
  
December 22, 2022
Good Maritime Co. (1)(3)
 
Liberia
  
Goodship
 
February 10, 2023
  
December 5, 2023
Traders Maritime Co. (1)(3)
 
Marshall Islands
  
Tradership
 
February 28, 2023
  
December 5, 2023
Chrisea Maritime Co. (1)
   Marshall Islands   Chrisea   February 21, 2023   N/A
Oasea Maritime Co. (1)(3)
   Marshall Islands   Oasea   March 27, 2023   July 19, 2024
Cretansea Maritime Co. (1)(3)
   Marshall Islands   Cretansea   April 26, 2023   April 26, 2023
Synthesea Maritime Co. (1)(3)
   Liberia   Synthesea   August 1, 2023   August 1, 2024
Exelixsea Maritime Co. (1)(3)
   Marshall Islands   Exelixsea   August 29, 2023   March 27, 2024
Nisea Maritime Co. (1)(3)   Liberia   Nisea   September 10, 2024   N/A

(1)
Subsidiaries wholly owned
(2)
Management company
(3)
Bareboat charterers
(4)
Dissolved companies within 2024

F-8
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
2.
Significant Accounting Policies:

(a)
Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) and include the accounts and operating results of United and its wholly-owned subsidiaries where United has control. Control is presumed to exist when United, through direct or indirect ownership, retains the majority of the voting interest. In addition, United evaluates its relationships with other entities to identify whether they are variable interest entities and to assess whether it is the primary beneficiary of such entities. If the determination is made that the Company is the primary beneficiary, then that entity is included in the consolidated financial statements. When the Company does not have a controlling interest in an entity, but exerts a significant influence over the entity, the Company applies the equity method of accounting. All intercompany balances and transactions have been eliminated on consolidation.

The Company deconsolidates a subsidiary or derecognizes a group of assets when the Company no longer controls the subsidiary or group of assets specified in Accounting Standards Codification (ASC or Codification) 810-10-40-3A. When control is lost, the Company derecognizes the assets and liabilities of the qualifying subsidiary or group of assets. The Financial Accounting Standards Board (“FASB”) concluded that the loss of control and the related deconsolidation of a subsidiary or derecognition of a group of assets specified in ASC 810-10-40-3A is a significant economic event that changes the nature of the investment held in the subsidiary or group of assets. Based on this consideration, a gain or loss is recognized upon the deconsolidation of a subsidiary or derecognition of a group of assets.

(b)
Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates include evaluation of relationships with other entities to identify whether they are variable interest entities, determination of vessel useful lives and determination of vessels’ impairment.

(c)
Foreign Currency Translation

United’s functional currency is the United States dollar since the Company’s vessels operate in international shipping markets and therefore primarily transact business in U.S. Dollars. The Company’s books of accounts are maintained in U.S. Dollars. Transactions involving other currencies are translated into the United States dollar using exchange rates that are in effect at the time of the transaction. At the balance sheet dates, monetary assets and liabilities, which are denominated in other currencies, are translated to United States dollars at the foreign exchange rate prevailing at year-end. Gains or losses resulting from foreign currency translation are reflected in the consolidated statement of operations.

(d)
Concentration of Credit Risk

Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of cash and cash equivalents and accounts receivable trade. The Company places its cash and cash equivalents and restricted cash, consisting mostly of deposits, with high credit qualified financial institutions. The Company performs periodic evaluations of the relative credit standing of the financial institutions in which it places its deposits. The Company limits its credit risk with accounts receivable by performing ongoing credit evaluations of the financial condition of its customers, receives charter hires in advance and generally does not require collateral for its accounts receivable.

F-9
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
(e)
Cash and Cash Equivalents

United considers time deposits and all highly liquid investments with an original maturity of three months or less to be cash equivalents.

(f)
Term Deposits

United classifies time deposits and all highly liquid investments with an original maturity of more than three months as term deposits.

(g)
Restricted Cash

Restricted cash is excluded from cash and cash equivalents. Restricted cash represents minimum cash deposits or cash collateral deposits required to be maintained with certain banks under the Company’s borrowing arrangements or in relation to bank guarantees issued on behalf of the Company, which are legally restricted as to withdrawal or use. In the event that the obligation relating to such deposits is expected to be terminated within the next twelve months, these deposits are classified as current assets; otherwise, they are classified as non-current assets.

(h)
Accounts Receivable Trade

Accounts receivable trade at each balance sheet date, includes receivables from charterers for hire, freight and demurrage billings, net of a provision for doubtful accounts. Receivables related to spot voyages are determined to be unconditional and are included in “Accounts Receivable Trade”. At each balance sheet date, all potentially uncollectible accounts are assessed individually for purposes of determining the appropriate provision for doubtful accounts. The Company also assessed the provisions of ASC 326, Financial Instruments—Credit Losses, by assessing the counterparties’ credit worthiness and concluded that there is no material impact in the Company’s financial statements as of December 31, 2024 and 2023. No provision for doubtful accounts was established as of December 31, 2024 and 2023.

(i)
Inventories

Inventories consist of lubricants and bunkers, which are measured at the lower of cost or net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.  Cost is determined by the first in, first out method.

(j)
Insurance Claims

The Company records insurance claim recoveries for insured losses incurred on damage to fixed assets and for insured crew medical expenses and for legal fees covered by directors’ and officers’ liability insurance. Insurance claim recoveries are recorded, net of any deductible amounts, at the time the Company’s fixed assets suffer insured damages or when crew medical expenses are incurred, recovery is probable under the related insurance policies, the claim is not subject to litigation and the Company can make an estimate of the amount to be reimbursed. The classification of the insurance claims into current and non-current assets is based on management’s expectations as to their collection dates. The Company assesses the counterparties’ credit worthiness according to provisions of ASC 326, Financial Instruments—Credit Losses.  No provision for credit losses was recorded with regards to any insurance claims which might have existed as of December 31, 2024 and 2023.

(k)
Vessels

Vessels acquired as a part of a business combination are recorded at fair market value on the date of acquisition. Vessels acquired as asset acquisitions are stated at historical cost, which consists of the contract price less discounts, plus any material expenses incurred upon acquisition (delivery expenses and other expenditures to prepare for the vessel’s initial voyage). Vessels acquired from entities under common control are recorded at historical cost. Subsequent expenditures for conversions and major improvements are capitalized when they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Expenditures for routine maintenance and repairs are expensed as incurred.

F-10
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
In addition, other long-term investments relating to vessels’ equipment not yet installed, are included in “Deferred charges and other investments, non-current” in the consolidated balance sheets. Amounts paid (if any) for other investments, non-current, that refer to equipment for the vessels not yet installed are included in “Vessels acquisitions and improvements” under “Cash flows from investing activities” in the consolidated statements of cash flows.

(l)
Vessel Depreciation

Depreciation is computed using the straight-line method over the estimated useful life of the vessels (25 years), after considering the estimated salvage value. Salvage value is estimated by the Company by taking the cost of steel times the weight of the ship noted in lightweight ton (“LWT”). Salvage values are periodically reviewed and revised to recognize changes in conditions, new regulations or for other reasons. Revisions of salvage values affect the depreciable amount of the vessels and affect depreciation expense in the period of the revision and future periods.

Effective January 1, 2024 and following management’s reassessment of the residual value of the vessels, the estimated scrap value per LWT was increased to $0.35 from $0.30. Management’s estimate was based on the average demolition prices prevailing in the market in the last 15 years. The effect of this change in accounting estimate, which did not require retrospective application as per ASC 250 “Accounting Changes and Error Corrections”, was to decrease net loss for the year ended December 31, 2024, by $786 or $0.09 per weighted average number of shares, both basic and diluted based on the Company’s existing fleet as of January 1, 2024.

(m)
Impairment of Long-Lived Assets (Vessels) and Right-of-use assets

The Company reviews its long-lived assets (vessels) and right-of-use assets for impairment whenever events or changes in circumstances, such as prevailing market conditions, obsolesce or damage to the asset, business plans to dispose a vessel earlier than the end of its useful life and other business plans, indicate that the carrying amount of the assets, plus any unamortized dry-docking costs or right-of use assets, may not be recoverable. The volatile market conditions with decreased charter rates and decreased vessel market values are conditions that the Company considers to be indicators of a potential impairment for its vessels and right-of use assets.

The Company determines undiscounted projected operating cash flows for each vessel and right-of use asset and compares it to the vessel’s carrying value, plus any unamortized dry-docking costs or right-of-use asset. When the undiscounted projected operating cash flows expected to be generated by the use of the vessel and/or its eventual disposition and right-of-use asset are less than the vessel’s carrying value, plus any unamortized dry-docking costs or right-of-use asset, the Company impairs the carrying amount of the vessel or right-of-use asset. Measurement of the impairment loss is based on the fair value of the asset as determined by independent valuators and use of available market data. The undiscounted projected operating cash inflows are determined by considering the charter revenues from existing time charters for the fixed fleet days and an estimated daily time charter equivalent for the non-fixed days (based on a combination of one year charter rates estimates and the average of the trailing 10-year historical charter rates, excluding outliers) adjusted for commissions, expected off hires due to scheduled maintenance and estimated unexpected breakdown off hires. The undiscounted projected operating cash outflows are determined by applying various assumptions regarding vessel operating expenses and scheduled maintenance.

For the year ended December 31, 2024, indicators of impairment existed for two of the Company’s vessels and one of the Company’s right-of use assets. The carrying value of the Company’s vessels plus any unamortized dry-docking costs and right-of use-assets for which impairment indicators existed as at December 31, 2024, was $44,009 and $27,560, respectively. From the impairment exercise performed, the undiscounted projected operating cash flows expected to be generated by the use of these two vessels and one right-of-use asset were higher than the vessels’ carrying value, plus any unamortized dry-docking costs and right-of-use assets, and thus the Company concluded that no impairment charge should be recorded.

F-11
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
(n)
Assets held for sale


The Company classifies a vessel along with associated inventories as being held for sale when all of the criteria under ASC 360, Property, Plant and Equipment, are met: (i) management has committed to a plan to sell the vessel; (ii) the vessel is available for immediate sale in its present condition; (iii) an active program to locate a buyer and other actions required to complete the plan to sell the vessel have been initiated; (iv) the sale of the vessel is probable, and transfer of the asset is expected to qualify for recognition as a completed sale within one year; (v) the vessel is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and (vi) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Vessels classified as held for sale are measured at the lower of their carrying amount or fair value less cost to sell. The resulting difference, if any, is recorded under “Impairment loss” in the consolidated statements of operations. The vessels are not depreciated once they meet the criteria to be classified as held for sale.

(o)
Dry-Docking and Special Survey Costs

The Company follows the deferral method of accounting for dry-docking costs and special survey costs whereby actual costs incurred are deferred and are amortized on a straight-line basis over the period through the date the next survey is scheduled to become due. Dry-docking costs which are not fully amortized by the next dry-docking period are expensed. Amounts are included in “Deferred charges and other investments, non-current”.

(p)
Commitments and Contingencies

Liabilities for loss contingencies, arising from claims, assessments, litigation, fines and penalties, environmental and remediation obligations and other sources are recorded when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

(q)
Revenue Recognition

Revenues are generated from time charters and spot charters. Revenues generated from time charter agreements contain a lease as they meet the criteria of a lease under ASC 842. Agreements with the same charterer are accounted for as separate agreements according to their specific terms and conditions. All agreements contain a minimum non-cancellable period and an extension period at the option of the charterer. Each lease term is assessed at the inception of that lease. Under a time charter agreement, the charterer pays a daily hire for the use of the vessel and reimburses the owner for hold cleanings, extra insurance premiums for navigating in restricted areas and damages caused by the charterers.

Time charter revenue is recorded over the term of the charter agreement as the service is provided and collection of the related revenue is reasonably assured. Under a time charter, revenue is adjusted for a vessel’s off hire days due to major repairs, dry dockings or special or intermediate surveys. Revenues from time charter agreements providing for varying annual rates are accounted for as operating leases and thus recognized on a straight-line basis over the non-cancellable rental periods of such agreements, as service is performed. Time charter agreements may include ballast bonus payments made by the charterer which serve as compensation for the ballast trip of the vessel to the delivery port, which are deferred and also recognized on a straight line basis over the charter period. Deferred revenue includes cash received prior to the balance sheet date for which all criteria to recognize as revenue have not been met. The Company, as lessor, has elected not to separate lease and non-lease components (operation and maintenance of the vessel) as their timing and pattern of transfer to the charterer, as the lessee, are the same and the lease component, if accounted for separately, would be classified as an operating lease. Additionally, the lease component is considered the predominant component as the Company has assessed that more value is ascribed to the vessel rather than to the services provided under the time charter contracts. Vessels are employed on short to medium-term time charter contracts, which provide flexibility in responding to market developments. For dry bulk vessels, rental income on the Company’s time charters is calculated at an index linked rate based on the five T/C routes rate of the Baltic Capesize Index and Baltic Panamax Index. Under the terms of our dry bulk vessels’ time charter agreements, the Company has the option to convert the floating index linked rate into a fixed charter rate based on the prevailing forward freight agreement curves.

F-12
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Spot charter agreements are charter hires, where a contract is made in the spot market for the use of a vessel for a specific voyage at a specified charter rate per ton of cargo. Spot charter revenue is recognized on a pro-rata basis over the duration of the voyage from loading to discharge, when a voyage agreement exists, the price is fixed or determinable, service is provided and the collection of the related revenue is reasonably assured.  For voyage charters, the Company satisfies its single performance obligation to transfer cargo under the contract over the voyage period. The Company has taken the practical expedient not to disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

Demurrage income, which is considered a form of variable consideration, is included in voyage revenues, and represents payments by the charterer to the vessel owner when loading or discharging time exceeds the stipulated time in the voyage charter agreements.

Pool revenue for each vessel is determined in accordance with the profit-sharing mechanism specified within each pool agreement. In particular, the Company’s pool managers aggregate the revenues and expenses of all of the pool participants and distribute the net earnings to participants, as applicable:


 •
based on the pool points attributed to each vessel (which are determined by vessel attributes such as cargo carrying capacity, speed, fuel consumption, and construction and other characteristics); or

•
by making adjustments to account for the cost performance, the bunkering fees and the trading capabilities of each vessel; and

•
the number of days the vessel participated in the pool in the period (excluding off-hire days).

The Company records revenue generated from the pools in accordance with ASC 842, Leases, since it assesses that a vessel pool arrangement is a variable time charter with the variable lease payments recorded as income in profit or loss in the period in which the changes in facts and circumstances on which the variable lease payments are based occur.

(r)
Commissions

Commissions, which include address and brokerage commissions, are recognized in the same period as the respective charter revenues. Address commissions to third parties and commissions to related parties (Note 3) are included in “Vessel revenue, net” while brokerage commissions to third parties are included in “Voyage expenses”. For the years ended December 31, 2024, 2023 and 2022, an amount of $1,761, $1,113 and $424, respectively, was included in “Vessel revenue, net” related to commission to third parties.

(s)
Vessel Voyage Expenses

Vessel voyage expenses primarily consist of port, canal, bunker expenses and brokerage commissions that are unique to a particular charter and are paid for by the charterer under time charter agreements and other non-specified voyage expenses. Under a spot charter, the Company incurs and pays for certain voyage expenses, primarily consisting of bunkers consumption, brokerage commissions, port and canal costs. Under ASC 606 and after implementation of ASC 340-40 “Other assets and deferred costs” for contract costs, incremental costs of obtaining a contract with a customer and contract fulfillment costs are capitalized and amortized as the performance obligation is satisfied, if certain criteria are met. Costs to fulfill the contract prior to arriving at the load port primarily consist of bunkers which are deferred and amortized during the charter period. As of December 31, 2024 and 2023, unamortized contract costs amounted to $160 and $NIL are included in the consolidated balance sheets under “Other current assets”. Costs amortized during the year ended December 31, 2024, 2023 and 2022, to fulfill contracts were $125, $NIL, $NIL respectively.

(t)
Fair value of above/ below market acquired time charters:

The Company values any asset or liability arising from the market value of the time charters assumed when a vessel is acquired or contributed. Where vessels are acquired or contributed with existing time charters, the Company determines the present value of the difference between: (i) the contractual charter rate and (ii) the market rate for a charter of equivalent duration prevailing at the time the vessels are delivered. In discounting the charter rate differences in future periods, the Company uses its cost of capital for each vessel. The cost of the acquisition is allocated to the vessel and the in-place time charter attached on the basis of their relative fair values. Such intangible asset or liability is recognized ratably as an adjustment to revenues over the remaining term of the assumed time charter.

F-13
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
(u)
Repairs and Maintenance

All repair and maintenance expenses, including major overhauling and underwater inspection expenses are expensed in the year incurred. Such costs are included in “Vessel operating expenses”.

(v)
Financing Costs

Underwriting, legal and other direct costs incurred with the issuance of long-term debt or to refinance existing debt are deferred and amortized to interest expense over the life of the related debt using the effective interest method under modification guidance. The Company presents unamortized deferred financing costs as a reduction of long-term debt in the accompanying balance sheet. For the accounting of the unamortized deferred financing costs following debt extinguishment, see below (Note 2(ab)).

(w)
Income Taxes

Pursuant to the Internal Revenue Code of the United States (the “Code”), U.S. source income from the international operations of ships is generally exempt from U.S. tax if the company operating the ships meets both of the following requirements: (a) the Company is organized in a foreign country that grants an equivalent exception to corporations organized in the United States and (b) either (i) more than 50% of the value of the Company’s stock is owned, directly or indirectly, by individuals who are “residents” of the Company’s country of organization or of another foreign country that grants an “equivalent exemption” to corporations organized in the United States (50% Ownership Test) or (ii) the Company’s stock is “primarily and regularly traded on an established securities market” in its country of organization, in another country that grants an “equivalent exemption” to United States corporations, or in the United States (Publicly-Traded Test).

Notwithstanding the foregoing, the regulations provide, in pertinent part, that each class of the Company’s stock will not be considered to be “regularly traded” on an established securities market for any taxable year in which 50% or more of the vote and value of the outstanding shares of such class are owned, actually or constructively under specified stock attribution rules, on more than half the days during the taxable year by persons who each own 5% or more of the value of such class of the Company’s outstanding stock (“5 Percent Override Rule”).

Based on the Company’s analysis of its shareholdings during 2024, the Publicly-Traded Test for the entire 2024 year has been satisfied in that less than 50% of the Company’s issued and outstanding shares were owned by shareholders none of whom owned directly or indirectly 5% or more of the vote and value of such class of stock for more than half the days during the 2024 taxable year. Effectively, the Company and each of its subsidiaries qualify for this statutory tax exemption for the 2024 taxable year.

Certain charterparties of the Company contain clauses that permit the Company to seek reimbursement from charterers of any U.S. tax paid. The Company’s U.S. federal income tax based on its U.S. source shipping income for 2024 and 2023 was $NIL and $NIL, respectively.

(x)
Stock-based Compensation

Stock-based compensation represents vested and non-vested common stock granted to directors and employees for their services as well as to certain employees of the Company’s service providers and non-employees. The Company calculates stock-based compensation expense for the award based on its fair value on the grant date and recognizes it on an accelerated basis over the vesting period. The Company assumes that all non-vested shares will vest. The Company does not include estimated forfeitures in determining the total stock-based compensation expense because it elects to accounts the forfeitures of non-vested shares as incurred. The Company re-evaluates the reasonableness of its assumption at each reporting period.

F-14
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
(y)
Earnings per Share

Basic earnings per common share are computed by dividing net income available to United’s shareholders by the weighted average number of common shares outstanding during the period. Unvested shares granted under the Company’s incentive plan, or else, are entitled to receive dividends which are not refundable, even if such shares are forfeited, and therefore are considered participating securities for basic earnings per share calculation purposes, using the two-class method. The two-class method requires income available to common stockholders for the period to be allocated between common shares and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. Diluted earnings per share is computed by (i) dividing net income attributable to common stockholders by the weighted average number of common shares plus (ii) the dilutive effect for warrants and share based payments awards outstanding during the applicable period computed using the treasury stock method which assumes that the “proceeds” upon exercise of these awards or warrants are used to purchase common shares at the average market price for the period and (iii) the dilutive effect of convertible preferred shares, using the if converted method. The two-class method is used for diluted earnings per common share when such is the most dilutive method, considering anti–dilution sequencing as per ASC 260, Earnings Per Share. Potential common shares that have an anti-dilutive effect (i.e. those that increase income per share or decrease loss per share) are excluded from the calculation of diluted earnings per share.

(z)
Segment Reporting

The Company reports financial information and evaluates its operations by total charter revenues and not by the length of vessel employment, customer, type of charter or geographical area as the charterer is free to trade the vessel worldwide and as a result, the disclosure of geographic information is impracticable. Although revenue can be identified for different types of charters, management does not identify expenses, profitability or other financial information for different charters. As a result, management, including the Chief Operating Decision Maker (or “CODM”), reviewed operating results solely by revenue per day and consolidated operating results of the fleet, and thus the Company had determined that it had only one operating and reportable segment and has identified the Chairman and Chief Executive Officer as the CODM in accordance with ASC 280, Segment Reporting. The accounting policies applied to the reportable segment are the same as those used in the preparation of the Company’s consolidated financial statements.

(aa)
Fair Value Measurements

The Company follows the provisions of ASC 820, Fair Value Measurement, which defines and provides guidance as to the measurement of fair value. The guidance creates a fair value hierarchy of measurement and describes fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts. In accordance with the requirements of accounting guidance relating to Fair Value Measurements, the Company classifies and discloses its assets and liabilities carried at fair value in one of the following categories:

•
Level 1: Quoted market prices in active markets for identical assets or liabilities;
•
Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data;
•
Level 3: Unobservable inputs that are not corroborated by market data.

(ab)
Debt Modifications and Extinguishments

The Company follows the provisions of ASC 470-50, Modifications and Extinguishments, to account for all modifications or extinguishments of debt instruments, except debt that is extinguished through a troubled debt restructuring or a conversion of debt to equity securities of the debtor pursuant to conversion privileges provided in terms of the debt at issuance. This Subtopic also provides guidance on whether an exchange of debt instruments with the same creditor constitutes an extinguishment and whether a modification of a debt instrument should be accounted for in the same manner as an extinguishment. In circumstances where an exchange of debt instruments or a modification of a debt instrument does not result in extinguishment accounting, this Subtopic provides guidance on the appropriate accounting treatment. Costs associated with new loans or refinancing of existing loans, including fees paid to lenders or required to be paid to third parties on the lender’s behalf for obtaining new loans or refinancing existing loans, are recorded as deferred charges. Costs paid directly to third parties are expensed as incurred. Deferred financing costs are presented as a deduction from the corresponding liability. Such fees are deferred and amortized to interest and finance costs during the life of the related debt using the effective interest method. Unamortized fees relating to loans repaid or refinanced, meeting the criteria of debt extinguishment, are expensed in the period the repayment or refinancing is made. In particular, ASC 470-50-40-2 indicates that for extinguishments of debt, the difference between the reacquisition price and the net carrying amount of the extinguished debt (which includes any deferred debt issuance costs) should be recognized as a gain or loss when the debt is extinguished and identified as a separate item.

F-15
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
(ac)
Distinguishing Liabilities from Equity

The Company follows the provisions of ASC 480 “Distinguishing liabilities from equity” to determine the classification of certain freestanding financial instruments as either liabilities or equity. The Company, in its assessment for the accounting of the warrants issued in connection with the July 20, 2022 public offering, the Series B Preferred Shares and the Series C Preferred Shares issued to Seanergy in exchange for working capital contribution, has taken into consideration ASC 480 and determined that the warrants, the Series B Preferred Shares and the Series C Preferred Shares should be classified as equity instead of liability. In its assessment for the warrants, the Company identified certain embedded features, examined whether these fall under the definition of a derivative according to ASC 815, Derivatives and Hedging, applicable guidance or whether certain of these features affected the classification. Derivative accounting was deemed inappropriate and thus no bifurcation of these features was performed. Upon exercise of the warrants, the holder is entitled to receive common shares. In its assessment for the Series C Preferred Shares, the Company identified certain features, such as redemption rights, conversion rights, voting rights and dividend rights. In its assessment, the Company examined whether these fall under the definition of a derivative according to ASC 815 applicable guidance or whether certain of these features affected the classification. Derivative accounting was deemed inappropriate and thus no bifurcation of these features was performed. The Company concluded that equity classification was appropriate.

(ad)
Share repurchases

The Company records the repurchase of its common shares at cost. The Company’s common shares repurchased for retirement, are immediately cancelled and the Company’s common stock is accordingly reduced. Any excess of the cost of the shares over their par value is allocated in additional paid-in capital, in accordance with ASC 505-30-30, Treasury Stock.

(ae)
Evaluation of Nonmonetary Transactions

When the Company enters into a nonmonetary transaction as defined broadly under ASC 845, Nonmonetary Transactions, it determines whether the transaction is a contribution of an asset or a business by assessing the definition of a business under ASC 805, Business Combination, and whether the transaction is pro-rata. A transaction is considered pro rata if each owner receives an ownership interest in the transferee in proportion to its existing ownership interest in the transferor (even if the transferor retains an ownership interest in the transferee). In accordance with FASB Topic 805 Business Combinations: Clarifying the Definition of a Business, if substantially all of the fair value of the gross assets acquired in an acquisition transaction are concentrated in a single identifiable asset or group of similar identifiable assets, then the set is not a business. To be considered a business, a set must include an input and a substantive process that together significantly contributes to the ability to create an output. All assets contributed under nonmonetary transactions that do not meet the definition of a business, are measured at their fair values on the transaction date in accordance with ASC 845, if the fair value is objectively measurable and clearly realizable in an outright sale at or near the distribution.

(af)
Sale and Leaseback Transactions

In accordance with ASC 842, the Company, as seller-lessee, determines whether the transfer of an asset should be accounted for as a sale in accordance with ASC 606. The existence of an option for the seller-lessee to repurchase the asset precludes the accounting for the transfer of the asset as a sale unless both of the following criteria are met: (1) the exercise price of the option is the fair value of the asset at the time the option is exercised and (2) there are alternative assets, substantially the same as the transferred asset, readily available in the marketplace; and the classification of the leaseback as a finance lease or a sales-type lease, precludes the buyer-lessor from obtaining control of the asset. The existence of an obligation for the Company, as seller-lessee, to repurchase the asset precludes accounting for the transfer of the asset as sale as the transaction would be classified as a financing arrangement by the Company as it effectively retains control of the underlying asset. If the transfer of the asset meets the criteria of sale, the Company, as seller-lessee recognizes the transaction price for the sale when the buyer-lessor obtains control of the asset, derecognizes the carrying amount of the underlying asset and accounts for the lease in accordance with ASC 842. If the transfer does not meet the criteria of sale, the Company does not derecognize the transferred asset, accounts for any amounts received as a financing arrangement and recognizes the difference between the amount of consideration received and the amount of consideration to be paid as interest.

F-16
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
(ag)
Finance Lease Liabilities & Right-of-Use Assets

Bareboat charter-in agreements that the Company may enter into are accounted for pursuant to ASC 842 and are classified as finance leases if they either involve a purchase obligation or a purchase option that is reasonably certain, at inception, that will be exercised. At the commencement date of the finance lease, a lessee initially measures the lease liability at the present value, using the discount rate determined on the commencement, of the lease payments to be made over the lease term, including any amount for the purchase the vessel, if applicable. Subsequently, the lease liability is increased by the interest on the lease liability and decreased by the lease payments during the period. The interest on the lease liability is determined in each period during the lease term as the amount that produces a constant periodic discount rate on the remaining balance of the liability, taking into consideration the reassessment requirements.

A lessee initially measures the finance right-of-use asset at cost which consists of the amount of the initial measurement of the lease liability; any lease payments made to the lessor at or before the commencement date, less any lease incentives received; and any initial direct costs incurred by the lessee. Subsequently, the finance right-of-use asset is measured at cost less any accumulated amortization and any accumulated impairment losses, taking into consideration the reassessment requirements. A lessee shall amortize the finance right-of-use asset on a straight-line basis (unless another systematic basis better represents the pattern in which the lessee expects to consume the right-of-use asset’s future economic benefits) from the commencement date to the earlier of the end of the useful life of the finance right-of-use asset or the end of the lease term. However, if the lease transfers ownership of the underlying asset to the lessee or the lessee is reasonably certain to exercise an option to purchase the underlying asset, the lessee shall amortize the right-of-use asset to the end of the useful life of the underlying asset. The Company elected the practical expedient on not separating lease components from non lease components in accordance with ASC 842-10-15-37.

(ah)
Equity method investments

Investments in the equity of entities over which the Company exercises significant influence, but does not exercise control, are accounted for by the equity method of accounting in accordance with ASC 323 “Investments-Equity method and joint ventures”. In reaching such a conclusion, the Company first assesses whether it holds variable interests in the investee and, further, whether the investee meets the definition of a variable interest entity (“VIE”). The Company then determines whether it is the investee’s primary beneficiary by considering any special rights (in terms of voting, board representation, kick out rights, or otherwise), that grant it with the power to direct the activities of the investee. In case the investee does not fall under the consolidation guidance, the Company records such an investment at cost and adjusts the carrying amount for its share of the earnings or losses of the entity subsequent to the date of investment and reports the recognized earnings or losses in income. Dividends received, if any, reduce the carrying amount of the investment. When the Company’s share of losses in an investee equals or exceeds its interest in the investee, the Company does not recognize further losses unless the Company has incurred obligations or made payments on behalf of the investee. At each reporting period, the Company also evaluates whether a loss in the value of an investment that is other than a temporary decline should be recognized. In its assessment, the Company evaluates indicators such as market conditions, the investee’s performance, and the ability to sustain an earnings capacity that would justify the carrying amount of the investment and its ability to continue as a going concern. Measurement of the impairment loss is based on the fair value of the investment. As of December 31, 2024, with regards to its investment in RGI Marine Holdings AS (“RGI”), the Company determined that it had variable interests in RGI and that RGI was a VIE, but the Company was not the primary beneficiary of such entity. The Company further evaluated that no loss in the value of its investment in RGI should be recognized (Note 8).

(ai)
Going Concern

Under ASC 205-40, Going Concern, management is required to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern.  For each reporting period, management is required to evaluate whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date the financial statements are issued. The Company’s cash flow projections indicate that it will be in a position to meet its obligations and cover the liquidity needs that become due in the twelve-month period ending one year after the financial statements are issued.

F-17
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Recent Accounting Pronouncements Adopted

The Company has adopted ASU 2023-07, which requires the disclosure of significant segment expenses that are part of an entity’s segment measure of profit or loss and regularly provided to the CODM. In addition, it adds or makes clarifications to other segment-related disclosures, such as clarifying that the disclosure requirements in ASC 280 are required for entities with a single reportable segment and that an entity may disclose multiple measures of segment profit and loss. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024. The Company has one reportable segment and has identified the Chairman and Chief Executive Officer as the CODM in accordance with ASC 280, Segment Reporting. The accounting policies applied to the reportable segment are the same as those used in the preparation of the Company’s consolidated financial statements. The adoption of ASU No. 2023-07 did not have any effect in the Company’s consolidated financial statements, other than the disclosures made in this paragraph and relevant “Segment Reporting” accounting policy (Note 2z).

Recent Accounting Pronouncements – Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”. The standard is intended to require more detailed disclosure about specified categories of expenses (including employee compensation, depreciation, and amortization) included in certain expense captions presented on the face of the income statement. This ASU is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to all prior periods presented in the financial statements. The Company is currently assessing the impact this standard will have on its consolidated financial statements.

There are no other recent accounting pronouncements the adoption of which is expected to have a material effect on the Company’s consolidated financial statements in the current or any future periods.

3.
Transactions with Related Parties:

Transactions with Seanergy

On January 20, 2022, United was incorporated by Seanergy, under the laws of the Republic of the Marshall Islands to serve as the holding company of the Predecessor upon consummation of the Spin-Off (Note 1). Following the Spin-Off, United and Seanergy are independent publicly-traded companies. The Spin-Off was pro rata to the shareholders of the Parent, including holders of the Parent’s outstanding common shares and Series B preferred shares, so that such holders maintained the same proportionate interest in the Parent and in United both immediately before and immediately after the Spin-Off.

Contribution and Conveyance Agreement: Prior to the consummation of the Spin-Off, United entered into a Contribution and Conveyance Agreement with Seanergy. Pursuant to the Contribution and Conveyance Agreement, Seanergy, immediately prior to the Spin-Off, contributed (i) all of the Predecessor’s shares to United as a capital contribution, and (ii) an aggregate of $5,000 in cash as working capital, in exchange for the issuance of 5,000 Series C Preferred Shares to Seanergy, the cancellation of the then outstanding common shares of United and the issuance of 1,512,004 common shares of United and 40,000 Series B Preferred Shares to Seanergy (the “Distribution Shares”). Seanergy distributed the Distribution Shares to its shareholders on a pro rata basis as a special dividend. Additionally, Seanergy agreed to indemnify United for any and all obligations and other liabilities arising from or relating to the operation, management or employment of the Gloriuship prior to the effective date of the Spin-Off, except for the July 2022 EnTrust Facility.

F-18
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Rights of First Refusal: Prior to the consummation of the Spin-Off, United entered into a Right of First Refusal Agreement with Seanergy. Pursuant to the agreement, Seanergy has a right of first refusal with respect to any opportunity available to United to sell, acquire or charter-in any Capesize vessel as well as with respect to chartering opportunities, other than short-term charters with a term of 13 months or less, available to United for Capesize vessels. In addition, United has a right of first offer with respect to any vessel sales by Seanergy. United exercised such right with respect to the sale of the Goodship and the Tradership (Note 5). Upon a change of control of United or Seanergy occurring (as defined therein), such rights terminate immediately.

The Spin-Off was accounted for at fair values since the assets contributed did not meet the definition of a business and their fair value was objectively measurable and clearly realizable in an outright sale at or near the distribution (Note 7). The equity contribution from the consummation of the Spin-Off was $18,728 including the $5,000 cash received in exchange of issuance of the 5,000 Series C Preferred Shares and is presented in “Spin-off transaction” in the accompanying consolidated statement of stockholders’ equity.

On July 26, 2022, the Company issued additional 5,000 Series C Preferred Shares to Seanergy in exchange for $5,000 cash in connection with United’s funding the deposits payable for four tanker vessels acquired between August and September 2022 (Note 5).

On November 28, 2022, the outstanding 10,000 Series C preferred shares of United held by Seanergy were redeemed by the Company at a price equal to 105% of the original issue price for a total cash outflow of $10,500. Total dividends paid in respect with the Series C Preferred Shares up to date of redemption amounted to $243.

Management Agreements:

Master Management Agreement
United entered into a master management agreement with Seanergy for the provision of technical, administrative, commercial, brokerage and certain other services. Certain of these services are being contracted directly with Seanergy’s wholly owned subsidiaries, Seanergy Shipmanagement Corp. (“Seanergy Shipmanagement”) and Seanergy Management Corp. (“Seanergy Management”). In consideration of Seanergy providing such services (“service providers”), United pays a fixed administration fee of $0.3 per vessel per day to Seanergy. The initial term of the master management agreement with Seanergy expired on December 31, 2024. No three months’ notice was given by either party prior to the end of the current term, thus this agreement was automatically extended for an additional 12-month period. The master management agreement may be terminated immediately only for cause and at any time by either party with three months’ prior notice, and no termination fee will be payable. During the year ended December 31, 2024, an amount of $4,411 ($NIL for the year ended December 31, 2023) related to payments for working capital purposes from Seanergy funds and is presented under “Cash flows from financing activities” in the consolidated statements of cash flows.

Technical Management Agreement
In relation to the technical management, Seanergy Shipmanagement is responsible for arranging (directly or by subcontracting) for the day-to-day operations, inspections, maintenance, repairs, drydocking, purchasing, insurance and claims handling for the Gloriuship, Chrisea, Cretansea, Goodship, Nisea (since September 10, 2024) and Oasea (until the vessel’s sale). Pursuant to the management agreements, Seanergy Shipmanagement earned a fixed management fee of $10 per month for such services for the Goodship until March 17, 2024. Thereafter, Seanergy Shipmanagement earns a fixed management fee of $14 per month for the above-mentioned vessels, except for the Oasea, for which the technical management agreement with Seanergy Shipmanagement was terminated following her sale (Note 5). As of December 31, 2024, five of Company’s vessels are under technical management agreement with Seanergy Shipmanagement for a fixed management fee of $14 per month.

F-19
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Commercial Management Agreement
United had entered into a commercial management agreement with Seanergy Management pursuant to which Seanergy Management acted as agent for United’s subsidiaries (directly or through subcontracting) for the commercial management of their vessels, including chartering, monitoring thereof, freight collection, and sale and purchase up until March 31, 2023, except for the Epanastasea for which such agreement was in effect up until her sale to her new owners in August 2023. United was paying to Seanergy Management a fee equal to 1.25% of the gross freight, demurrage and charter hire collected from the employment of United’s vessels, except for any vessels that were chartered-out to Seanergy. Seanergy Management also earned a fee equal to 1% of the contract price of any vessel bought or sold by them on United’s behalf, except for any vessels bought or sold from or to Seanergy, or in respect of any vessel sale relating to a sale and leaseback transaction.

Effective as of April 1, 2023, United’s subsidiary, United Management Corp. (“United Management”) has entered into a commercial management agreement with Seanergy Management pursuant to which Seanergy Management acts as agent for United’s subsidiaries for the commercial management of United’s vessels, including, inter alia, accounting services, voyage monitoring, freight collection, postfixing, sale, purchase and bareboat chartering. United is paying to Seanergy Management a fee equal to 0.75% of the gross freight, demurrage and charter hire collected from the employment of United’s vessels. In addition, Seanergy Management earns a fee equal to 1% of the contract price of any vessel bought, sold or bareboat chartered by them on United’s behalf (not including any vessels bought, sold or bareboat chartered from or to Seanergy, or any vessel sale relating to a sale and leaseback transaction).

The below table presents the analysis of “Management fees – related party” charged from Seanergy and Seanergy Shipmanagement in connection with the above agreements as presented in the accompanying statement of operations:

  Year ended
Year ended
From
January 20, 2022
through
  
Fees charged in relation to: 
December 31, 2024   December 31, 2023  
December 31, 2022
 
Management services – Seanergy
    
935
      
760
      
203
  
Management services – Seanergy Shipmanagement
   
806
      
661
      
82
  
Management fees- related party
   
1,741
      
1,421
      
285
  

The below table presents the fees charged from Seanergy Management in connection with the above agreements:
Year ended

Year ended

From
January 20, 2022
through
Fees charged in relation to:
  December 31, 2024     December 31, 2023    
December 31, 2022
 
Commercial services (1)
    
351
      
329
      
296
  
Purchase of vessel services (2)
    
285
      
1,073
      
795
  
Sale of vessel services (3)
    202       375       1,015  
Total
    
838
      
1,777
      
2,106
  

(1)
included in “Vessel revenue, net” (Note 12) in the accompanying statement of operations
(2)
 presented in “Right-of-use assets” (Note 6) and “Vessels, net” (Note 5)
(3) 
presented in “Gain on sale of vessels, net” (Note 5) in the accompanying statement of operations

F-20
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
The below table presents the analysis of  “Due to Related Parties” as presented in the accompanying consolidated balance sheets:

 
  
December 31,
2024
   
December 31,
2023
 
Balance due to Seanergy
   
5,597
      
252
  
Balance due to Seanergy Shipmanagement
   
1,004
      
198
  
Balance due to Seanergy Management
   
670
      
-
  
Due to Related Parties
   
7,271
      
450
  

The below table presents the analysis of  “Due from Related Parties” as presented in the accompanying consolidated balance sheets:
 
 
  
December 31,
2024
   
December 31,
2023
 
Balance due from Seanergy Management
    
-
      
142
  
Due from Related Parties
   
-
      
142
  

On April 7, 2025, the Compensation Committee of the Company granted 75,000 shares to certain employees of the Company’s service providers (Note 16).

On March 27, 2024, the Compensation Committee of the Company granted 65,000 shares to certain employees of the Company’s service providers (Note 15).

Transaction with RGI

On July 31, 2024, the Company agreed to make an investment in RGI which was accounted under equity method due to the Company’s significant influence over RGI (Note 8).

4.
Cash and Cash Equivalents and Restricted Cash:

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statement of cash flows:
 
   
December 31,
2024
    
 December 31,
2023
  
Cash and cash equivalents
    
6,412
       13,801  
Restricted cash, non-current
    
350
       700  
Cash and cash equivalents and restricted cash
     6,762       14,501  

Restricted cash, non-current as of December 31, 2024 includes $350 of minimum liquidity requirements as per the April 2023 Neptune Sale and Leaseback (Note 7).

Restricted cash, non-current as of December 31, 2023 includes $350 of minimum liquidity requirements as per the March 2023 Neptune Sale and Leaseback (Note 7) and $350 of minimum liquidity requirements as per the April 2023 Neptune Sale and Leaseback (Note 7).

F-21
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
5.
Vessels, Net:

The amounts in the accompanying consolidated balance sheets are analyzed as follows:

   
December 31,
2024
    
December 31,
2023
  
Cost:
            
Beginning balance:
    
112,375
       38,769  
- Additions
    
46,421
       95,051  
- Disposals
    
(19,753
)
     (21,445 )
- Transfer to “Vessel held for sale”
    (18,500 )     -  
Ending balance:
    
120,543
       112,375  
                 
Accumulated depreciation:
                
Beginning balance:
    
(7,556
)
     (1,257 )
- Depreciation for the period
    
(7,982
)
     (7,101 )
- Disposals
    
1,486
       802  
- Transfer to “Vessel held for sale” 
    4,098       -  
Ending balance:
    
(9,954
)
     (7,556 )
                 
Net book value
    
110,589
       104,819  

Acquisitions


On August 21, 2024, following the exercise of the purchase option of the Chrisea bareboat charter, an amount of $20,946 was derecognized from “Right-of-use assets” (Note 6) and recognized as “Vessels, net” in the accompanying consolidated balance sheets. The purchase option amount was financed through the Sinopac Loan Facility (Note 7).


On August 1, 2024, following the exercise of the purchase option of the Synthesea bareboat charter, an amount of $25,475 was derecognized from “Right-of-use assets” (Note 6) and recognized as “Vessels, net” in the accompanying consolidated balance sheets. The purchase option amount was financed with cash on hand and through the Onishi Sale and Leaseback (Note 7).



On June 9, 2023, the Company entered into an agreement with an unaffiliated party for the purchase of a secondhand Panamax vessel, the Exelixsea, for a gross purchase price of $17,815. The vessel was delivered to the Company on August 29, 2023. The acquisition of the vessel was financed with cash on hand and $15,000 allocated from the August 2022 Entrust Facility (Note 7).



On February 7, 2023, the Company entered into an agreement with an unaffiliated third party for the purchase of a secondhand Kamsarmax vessel, the Oasea, for a gross purchase price of $19,500. The vessel was delivered to the Company on March 27, 2023. The acquisition of the vessel was financed with cash on hand at delivery and subsequently through the March 2023 Neptune Sale and Leaseback (Note 7).



On February 7, 2023, the Company entered into an agreement with an unaffiliated third party for the purchase of a secondhand Kamsarmax vessel, the Cretansea, for a gross purchase price of $19,675. The vessel was delivered to the Company on April 26, 2023. The acquisition of the vessel was financed with cash on hand and through the April 2023 Neptune Sale and Leaseback (Note 7).


On December 27, 2022, the Company entered into an agreement with an affiliated party for the purchase of a secondhand Capesize vessel, the Goodship, for a gross purchase price of $17,500. The vessel was delivered to the Company on February 10, 2023. The acquisition of the vessel was financed with cash on hand and $7,000 allocated from the August 2022 Entrust Facility (Note 7).


F-22
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)

On December 27, 2022, the Company entered into an agreement with an affiliated party for the purchase of a secondhand Capesize vessel, the Tradership, for a gross purchase price of $18,750. The vessel was delivered to the Company on February 28, 2023. The acquisition of the vessel was financed with cash on hand and $8,200 allocated from the August 2022 EnTrust Facility (Note 7).

For the years ended December 31, 2024 and 2023, an amount of $NIL and $635, respectively, of expenditures related to vessels’ acquisition cost were capitalized and will be depreciated over the remaining useful life of each vessel. Amounts paid for these expenditures are included in “Vessels’ acquisitions and improvements” under “Cash flows from investing activities” in the consolidated statement of cash flows.

During the years ended December 31, 2024 and 2023, an amount of $NIL and $1,176, respectively, of expenditures were capitalized that concern improvements on vessels performance and meeting environmental standards. The cost of these additions was accounted as major improvement and were capitalized over the vessels’ cost and will be depreciated over the remaining useful life of each vessel. Amounts paid for the additions are included in “Vessels acquisitions and improvements” under “Cash flows from investing activities” in the consolidated statements of cash flows.

Vessel held for sale
 
On December 20, 2024, the Company entered into an agreement with an unaffiliated third party for the sale of the Gloriuship for a net sale price of $14,880. Delivery of the vessel to her new owners is expected to take place in the third quarter of 2025. On the same date, the vessel was classified as “Vessel held for sale” according to the provisions of ASC 360, as all the criteria for this classification were met. Accordingly, the outstanding amount of $8,333 under the Huarong Sale and Leaseback for Gloriuship was classified in current liabilities in the accompanying consolidated balance sheet. The specific vessel was impaired since its carrying amount, which is the unamortized balance of vessel cost of $14,402 and the unamortized balance of drydocking cost of $1,306 on the sale agreement date was higher than its fair value less cost to sell. As of December 31, 2024, “Vessel held for Sale” in the accompanying consolidated balance sheet is measured at fair value less cost to sell which was $14,880. Accordingly, an “Impairment loss” of $828 was recognized in the consolidated statements of operations. The fair value of the vessel was determined based on the agreed sale price, net of commissions.

Gain on sale of vessels, net

On May 2, 2024, the Company entered into an agreement with an unaffiliated third party for the sale of the Oasea for a gross sale price of $20,220. The vessel was delivered to her new owners on July 19, 2024. A gain on sale of vessel net of sale expenses amounting to $1,426 was recognized and is presented as “Gain on sale of vessels, net” in the consolidated statement of operations.

On May 5, 2023, the Company entered into an agreement with an unaffiliated third party for the sale of the Epanastasea for a gross sale price of $37,500. The vessel was delivered to her new owners on August 10, 2023. A gain on sale of vessel net of sale expenses amounting to $11,804 was recognized and is presented as “Gain on sale of vessels, net” in the consolidated statement of operations.

On September 24, 2022, the Company entered into an agreement with an unaffiliated third party for the sale of the Parosea for a gross sale price of $31,250. The vessel was delivered to her new owners on November 8, 2022. A gain on sale of vessel net of sale expenses amounting to $9,215 was recognized and is presented as “Gain on sale of vessels, net” in the consolidated statement of operations.

On September 24, 2022, the Company entered into an agreement with an unaffiliated third party for the sale of the Bluesea for a gross sale price of $31,250. The vessel was delivered to her new owners on December 1, 2022. A gain on sale of vessel net of sale expenses amounting to $9,175 was recognized and is presented as “Gain on sale of vessels, net” in the consolidated statement of operations.

On December 12, 2022, the Company entered into an agreement with an unaffiliated third party for the sale of the Minoansea for a gross sale price of $39,000. The vessel was delivered to her new owners on December 22, 2022. A gain on sale of vessel net of sale expenses amounting to $17,705 was recognized and is presented as “Gain on sale of vessels, net” in the consolidated statement of operations.

F-23
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
6.
Right-of-Use assets and Finance Lease Liabilities:

The annual lease payments under the Nisea bareboat charter agreement are as follows:

Twelve month periods ending December 31,
  
Amount
  
2025
    
2,920
  
2026
    
17,092
  
Total undiscounted lease payments
    
20,012
  
Less: Discount based on incremental borrowing rate
    
(1,042
)
Present value of finance lease liabilities
    
18,970
  
         
Finance lease liabilities, current
    
2,032
  
Finance lease liabilities, non-current
    
16,938
  
Present value of finance lease liabilities
    
18,970
  

The weighted average remaining lease term for Nisea bareboat charter was 1.19 years as of December 31, 2024.

The weighted average incremental borrowing rate for Nisea bareboat charters was 5.08% as of December 31, 2024.

On March 6, 2024, the Company entered into a bareboat charter agreement with an unaffiliated third party for a secondhand Kamsarmax vessel, the Nisea. The vessel was delivered to the Company on September 10, 2024 under an 18-month bareboat charter plus 30-days in lessee’s option at a daily rate of $8. The Company made a down payment of $3,750 upon signing of the bareboat charter agreement and a payment of $3,750 upon commencement of the bareboat charter. At the end of the 18-month bareboat period, the Company has an option to purchase the vessel for $16,620. The Company has classified the above transaction as a finance lease. At the commencement date, the Company recognized a finance lease liability equal to the present value of lease payments during the bareboat charter period using an incremental borrowing rate of 5.08%. The Company recognized a finance lease liability of $19,651 and a corresponding right-of-use asset of $28,006 which also includes $855 of initial direct costs. The amount of the right-of-use-assets is amortized on a straight-line method based on the estimated useful life of the vessel. During the year ended December 31, 2024, the amortization of the right-of-use asset amounted to $446 and is presented in the Company’s consolidated statements of operations under “Depreciation and amortization”. Interest expense on the finance lease liability for the same period amounted to $295 (Note 13). As of December 31, 2024, the right-of-use amounted to $27,560 and is presented under “Right-of-use assets” in the accompanying consolidated balance sheets.

On April 19, 2023, the Company entered into a bareboat charter agreement with an unaffiliated third party for a secondhand Panamax vessel, the Synthesea. The vessel was delivered to the Company on August 1, 2023 under a 12-month bareboat charter plus 30-days in lessee’s option at a daily rate of $8. The Company made a down payment of $3,500 on signing of the bareboat charter agreement and a payment of $3,500 upon commencement of the bareboat charter. At the end of the 12-month bareboat period, the Company exercised its option to purchase the vessel for $17,100. The Company has classified the above transaction as a finance lease. At the commencement date, the Company recognized a finance lease liability equal to the present value of lease payments during the bareboat charter period using an incremental borrowing rate of 5.59%. The Company recognized a finance lease liability of $19,048 and a corresponding right-of-use asset of $26,859 which also included $811 of initial direct costs. The amount of the right-of-use-asset is amortized on a straight-line method based on the estimated useful life of the vessel. During the years ended December 31, 2024 and 2023, the amortization of the right-of-use asset amounted to $705 and $679, respectively and is presented in the Company’s consolidated statements of operations under “Depreciation and amortization”. Interest expense on the finance lease liability for the years ended December 31, 2024 and 2023 amounted to $557 and $422, respectively (Note 13). As of December 31, 2023, the right-of-use amounted to $26,180 and is presented under “Right-of-use assets” in the accompanying consolidated balance sheets. On August 1, 2024, following the exercise of the purchase option mentioned above, an amount of $25,475 was derecognized from “Right-of-use assets” and recognized as “Vessels, net” in the accompanying consolidated balance sheet (Note 5).

F-24
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
On February 9, 2023, the Company entered into a bareboat charter agreement with an unaffiliated third party for a secondhand Panamax vessel, the Chrisea. The vessel was delivered to the Company on February 21, 2023 under an 18-month bareboat charter plus 30-days in lessee’s option at a daily rate of approximately $7. The Company made a down payment of $3,500 on signing of the bareboat charter agreement and a payment of $3,500 upon commencement of the bareboat charter. At the end of the 18-month bareboat period, the Company exercised its option to purchase the vessel for $12,360. The Company has classified the above transaction as a finance lease. At the commencement date, the Company recognized a finance lease liability equal to the present value of lease payments during the bareboat charter period using an incremental borrowing rate of 6.19%. The Company recognized a finance lease liability of $15,124 and a corresponding right-of-use asset of $22,824 which also included $700 of initial direct costs. The amount of the right-of-use-assets is amortized on a straight-line method based on the estimated useful life of the vessel. During the years ended December 31, 2024 and 2023, the amortization of the right-of-use asset amounted to $580 and $1,298, respectively, and is presented in the Company’s consolidated statements of operations under “Depreciation and amortization”. Interest expense on the finance lease liability for the years ended December 31, 2024 and 2023 amounted to $493 and $735, respectively (Note 13). As of December 31, 2023, the right-of-use amounted to $21,526 and is presented under “Right-of-use assets” in the accompanying consolidated balance sheets. On August 21, 2024, following the exercise of the purchase option mentioned above, an amount of $20,946 was derecognized from “Right-of-use assets” and recognized as “Vessels, net” in the accompanying consolidated balance sheet (Note 5).

7.
Long-Term Debt and Other Financial Liabilities:

The amounts in the accompanying consolidated balance sheets are analyzed as follows:

   
December 31,
2024
    
December 31,
2023
  
Long-term debt and other financial liabilities
    
80,465
      
65,842
  
Less: Deferred financing costs
    
(1,712
)
    
(1,308
)
Total
    
78,753
      
64,534
  
Less - current portion
    
(17,650
)
    
(8,691
)
Long-term portion
    
61,103
      
55,843
  

Senior long-term debt

New Loan Facility during the year ended December 31, 2024

Sinopac Loan Facility

On August 5, 2024, the Company entered a $16,500 loan facility (the “Sinopac Loan Facility”) with Sinopac Capital International (HK) Limited (“Sinopac”) for the purpose of financing the exercise of the purchase option of the Chrisea under its previous bareboat charter. An amount of $1,155, included in “Other non-current assets” in the consolidated balance sheet, was withheld as a security deposit by Sinopac upon the drawdown of the facility in order to secure the due liabilities by the Company of its obligations and undertakings as per Sinopac Loan Facility. The deposit can be set off against the balloon payment at maturity. The facility was drawn on August 19, 2024 and bears interest of term SOFR plus a margin of 2.60% per annum. The term of the facility is five years, and the repayment schedule comprises of twenty quarterly installments of $400, followed by a balloon installment of $8,500 payable along with the final installment. In addition, the Company is required to maintain a security cover ratio not less than 110% for the first two years and 120% at all times thereafter until the maturity of the loan. The Sinopac Loan Facility is secured by a first priority mortgage over the Chrisea, a general assignment covering earnings, insurances and requisition compensation of the vessel, a share pledge agreement concerning the vessel-owning subsidiary’s shares, a charter-party assignment and relevant managers’ undertakings. As of December 31, 2024, the outstanding amount under this facility was $16,100.

F-25
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Loan Facility repaid during the year ended December 31, 2024 and 2023

July 2022 EnTrust Facility

On July 1, 2022, the loan facility entered into between Seanergy and Kroll Agency Services Limited and Kroll Trustee Services Limited as facility agent and security agent, respectively, and certain nominees of EnTrust Global as lenders, for the Gloriuship, was amended for the purposes of replacing Seanergy with the Company as guarantor upon the consummation of the Spin-Off. The loan amount was $14,000 with a term of 18 months. The amended loan facility bore a fixed interest rate of 7.90% per annum. On November 8, 2022, the Company proceeded with the prepayment of $1,000, which was applied against the balloon payment. On December 1, 2022, the Company proceeded to a second prepayment of $1,000, which was applied equally against the first and the second repayment installments of the loan, respectively, reducing each such repayment installment to $500. On the date of each repayment, an aggregate amount of $25 of unamortized debt discounts were written off according to the debt extinguishment guidance of ASC 470-50 “Debt Modifications and Extinguishments” and was included in “Loss in extinguishment of debt” in the consolidated statement of operations. On November 15, 2023, the Company agreed to refinance the outstanding amount of the loan $10,000 using proceeds from the Huarong Sale and Leaseback. On December 5, 2023, upon the completion of the refinancing of the outstanding loan, an amount of $17 of the unamortized debt discounts was written off according to the debt extinguishment guidance of ASC 470-50 “Debt Modifications and Extinguishments” and was included in “Loss in extinguishment of debt” in the consolidated statement of operations.

August 2022 EnTrust Facility

On August 8, 2022, the Company entered into a loan facility with Kroll Agency Services Limited and Kroll Trustee Services Limited, as facility agent and security agent, respectively, and certain nominees of EnTrust Global as lenders in order to partially finance the acquisition of the Parosea, Bluesea, Minoansea and Epanastasea. The loan facility amount was originally $63,600, divided into four tranches with a term of 18 months: Tranche A of $16,200 which was secured by the Bluesea, Tranche B of $16,200 which was secured by the Parosea, Tranche C of $15,200 which was secured by the Minoansea and Tranche D of $16,000 which was secured by the Epanastasea. The facility bore interest at a fixed rate of 7.90% per annum. On November 8, 2022 and December 1, 2022 upon the completion of the sale of the Parosea, and the Bluesea, respectively, the Company completed the prepayment of the relevant tranches of $16,200 each. On the date of each repayment, $257 and $245 of unamortized debt discounts of the Parosea and Bluesea, respectively, were written off according to the debt extinguishment guidance of ASC 470-50 “Debt Modifications and Extinguishments” and were included in “Loss on extinguishment of debt” in the consolidated statement of operations. On December 21, 2022, the Company entered into a supplemental agreement pursuant to which upon the completion of the sale of the Minoansea, the lenders waived the obligation of the Company to prepay Tranche C and continued to make available the relevant amount for the purpose of partially financing the acquisition cost of two new Capesize vessels, the Goodship and Tradership (Note 5). Pursuant to this agreement, the fixed interest rate of Tranche C was amended to 9.00% per annum. The amount underlying Tranche C ($15,200) remained blocked in favor of the security agent until the acquisition of the vessels. On January 30, 2023, the Company entered into an amendment and restatement agreement with the lenders, pursuant to which, inter alia, Tranche C was replaced by two tranches of $7,000 (Tranche E) and $8,200 (Tranche F), secured by the Goodship and Tradership, respectively. On August 9, 2023, the Company entered into another amendment and restatement agreement pursuant to which, inter alia, upon the completion of the sale of the Epanastasea, the lenders waived the obligation of the Company to prepay Tranche D ($15,000) and continue to make available the relevant amount for the purpose of partially financing the acquisition cost of a the Exelixsea (Note 5). Pursuant to this agreement, the fixed interest rate of Tranche D was amended to 9.00% per annum. The amount underlying Tranche D remained blocked in favor of the security agent until the acquisition of the vessel, which was concluded on August 29, 2023. Upon the acquisition of the vessel, Tranche D was replaced by Tranche G secured by the Exelixsea. On November 15, 2023, the Company agreed to refinance the outstanding amounts of Trance E ($5,500) and Tranche F ($6,700) using proceeds from the Huarong Sale and Leaseback. On December 5, 2023, upon the completion of the refinancing of Tranche E and Tranche F, $28 and $33 of unamortized debt discounts of the Goodship and Tradership, respectively, were written off according to the debt extinguishment guidance of ASC 470-50 “Debt Modification and Extinguishments” and were included in “Loss on extinguishment of debt” in the consolidated statement of operations.

F-26
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Following the prepayments of Tranche E and Tranche F, the facility was repayable in one installment of $500 at the twelfth month after the utilization date, one installment of $1,500 at the fifteenth month after the utilization date, and a balloon payment of $13,000 at maturity.

On March 27, 2024, the outstanding principal of $13,000 under the Tranche G, secured by the Exelixsea, was repaid in full by proceeds from the Village Seven Sale and Leaseback and all obligations under the facility were irrevocably and unconditionally discharged. The unamortized debt discounts of $3 for Exelixsea was written off according to the debt extinguishment guidance of ASC 470-50 “Debt Modification and Extinguishments” and were included in “Loss on extinguishment of debt” in the consolidated statement of operations. Furthermore, the Company incurred costs amounted to $19 related to extinguishment of debt which are also included in “Loss on extinguishment of debt” in the consolidated statement of operations.

Other Financial Liabilities – Sale and Leaseback Transactions
 
New Sale and Leaseback Activities during the year ended December 31, 2024
 
Village Seven Sale and Leaseback

On February 22, 2024, the Company entered into a $13,800 sale and leaseback agreement with Village Seven Co., Ltd. and V7 Fune Inc. to refinance the August 2022 EnTrust Facility, secured by the Exelixsea. On March 27, 2024, the vessel was sold and chartered back on a bareboat basis for a period of four years, followed by an additional two-year period at the Company’s option. The charterhire principal is repayable in forty-eight consecutive monthly installments of approximately $192 paid in advance, which could extend to seventy-two installments in case of exercise of the two-year optional period, at the same terms. The financing bears an interest rate of 3-month term SOFR plus 2.65% per annum. The Company has continuous options to repurchase the vessel at predetermined prices, following the second anniversary of the bareboat charter. At the end of the optional period, the Company has the option to take ownership of the vessel at nominal additional cost. The sale and leaseback agreement does not include any financial covenants or security value maintenance provisions. As of December 31, 2024, the amount outstanding under the Village Seven Sale and Leaseback was $11,883.

Onishi Sale and Leaseback

On July 24, 2024, the Company entered into a $18,000 sale and leaseback agreement with Onishi Kaiun Co. and Ocean West Shipping S.A. for the purpose of financing the purchase option of the Synthesea under its previous bareboat charter. On August 1, 2024, the Company sold and chartered back the Synthesea on a bareboat basis for a period of five years, followed by an additional two-year period at the Company’s option. The charterhire principal amortizes through sixty consecutive monthly installments of approximately $136 paid in advance, which could extend to eighty-four installments in case of exercise of the two-year optional period, at the same terms. The financing bears an interest rate of 3-month term SOFR plus 2.70% per annum. Following the second anniversary of the bareboat charter, the Company has continuous options to repurchase the vessel at predetermined prices as set forth in the agreement. At the end of the optional period, the Company and the lessors have the option to repurchase and to sell the vessel, respectively, for $6,545. The sale and leaseback agreement does not include any financial covenants or security value maintenance provisions. As of December 31, 2024, the amount outstanding under the Onishi Sale and Leaseback was $17,182.

F-27
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Existing Sale and Leaseback Agreements

April 2023 Neptune Sale and Leaseback

On April 26, 2023, following the delivery of the Cretansea, the Company entered into a sale and leaseback agreement with a subsidiary of Neptune Maritime Leasing Ltd. (“Neptune’’) for the purpose of partly financing the acquisition cost of the Cretansea. The transaction was accounted for as a financial liability, as control remains with the Company and the Cretansea continue to be recorded as an asset on the Company’s balance sheet. The financing amount was $12,250 and the interest rate is 4.25% plus 3-month term SOFR per annum. The charterhire principal is repayable over a five-year term, through sixty monthly installments of approximately $98 and a balloon payment of $6,400 at the expiration of the bareboat. The Company is required to maintain a security coverage ratio (as defined therein) of at least 120% for the first twelve months and at least 130% thereafter. In addition, the Company is required to maintain minimum liquidity of $350 in its operating account. The sale-and-leaseback agreement includes certain restrictions on dividends from the lessee’s accounts and other distributions. The Company has continuous options to repurchase the vessel at predetermined prices as set forth in the agreement. At the end of the 5-year bareboat period, the Company has the obligation to repurchase the vessel for $6,400. As of December 31, 2024, the amount outstanding under the April 2023 Neptune Sale and Leaseback was $10,300.

Huarong Sale and Leaseback

On November 15, 2023, the Company entered into three identical sale and leaseback transactions with certain affiliates of China Huarong Shipping Financial Leasing Company Ltd. (“Huarong”) for the purpose of refinancing the outstanding indebtedness of the Gloriuship which was previously financed by the July 2022 EnTrust Facility and the outstanding indebtedness of Goodship and Tradership which were previously financed by the August 2022 EnTrust Facility. The Company sold and chartered back the vessels on a bareboat charter basis for a three-year period. The sale and leaseback agreements became effective on December 5, 2023, upon the delivery of the vessels to the lessors. The transactions were accounted for as financial liabilities, as control remains with the Company and the three vessels continue to be recorded as assets on the Company’s balance sheet. The sale and leaseback agreements do not include any financial covenants or security value maintenance provisions. The aggregate financing amount was $30,000 and the interest rate is 3.30% plus 3-month term SOFR per annum. The charterhire principal of each transaction is repayable through thirty-six monthly installments of $139 and a purchase obligation of $5,000 at the expiration of each bareboat agreement. The Company has continuous options to purchase the vessels on any date falling six months after the initiation of the bareboat charters at predetermined prices as set forth in the agreement. As of December 31, 2024, the aggregate charterhire principal was $25,000.

Sale and Leasebacks Agreements repaid during the year ended December 31, 2024 and 2023

March 2023 Neptune Sale and Leaseback

On March 31, 2023, following the delivery of the Oasea, the Company entered into a sale and leaseback agreement with a subsidiary of Neptune for the purpose of partly financing the acquisition cost of the Oasea. The financing amount was $12,250 and the interest rate was 4.25% plus 3-month term SOFR per annum. The charterhire principal was repayable over a five-year term, through sixty monthly installments of approximately $98 and a balloon payment of $6,400 at the expiration of the bareboat charter. The Company was required to maintain a security coverage ratio (as defined therein) of at least 120% for the first twelve months and at least 130% thereafter.  In addition, the Company was required to maintain minimum liquidity of $350 in its operating account, while at the end of the five-year bareboat period, the Company had the obligation to repurchase the vessel for $6,400. On July 19, 2024, the Company repurchased the vessel from Neptune, repaying the outstanding charterhire principal of $10,788 and the relevant fees, in connection with the sale of the Oasea to her new owners. The unamortized debt discounts of $148 of Oasea was written off according to the debt extinguishment guidance of ASC 470-50 “Debt Modifications and Extinguishments” and was included in “Loss in extinguishment of debt” in the consolidated statement of operations. Following the early repayment of the outstanding charter hire principal due to the disposal of Oasea, the company paid a prepayment fee and incurred cost related to extinguishment of debt amounted to $227 which are also included in “Loss on extinguishment of debt” in the consolidated statement of operations.

F-28
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Certain of the Company’s sale and leaseback agreements discussed above are secured by a guarantee from the Company; general assignments covering the respective vessels’ earnings, insurances and requisition compensation; account pledge agreements; charter-party assignments, technical and commercial managers’ undertakings and pledge agreements covering the shares of the applicable bareboat charterer subsidiary.

As of December 31, 2024, the Company was in compliance with all covenants relating to its debt facilities as at that date.

As of December 31, 2024, one of the Company’s owned vessels, having a net carrying value of $20,499, was subject to a first mortgage as collateral to her long-term debt facility. In addition, the Company’s five bareboat chartered vessels, having a net carrying value of $90,090 as of December 31, 2024, have been financed through sale and leaseback agreements. As customary in leaseback agreements, the title of ownership is held by the registered owners.

The annual principal payments required to be made after December 31, 2024 for all long-term debt and other financial liabilities, are as follows:

Twelve month periods ending December 31,
  
Amount
  
2025
    
18,373
  
2026
    
20,040
  
2027     6,706  
2028     12,326  
Thereafter     23,020  
Total
    
80,465
  


8.
Equity Method Investments:



On July 31, 2024, the Company agreed to make an investment in a Norwegian limited liability company, RGI, which participates under a newbuilding contract in the construction of an Energy Construction Vessel (“ECV”), with expected delivery date in May 2027. The Company’s interest in this investment in RGI will be between 46.4% and 49.8% of the total investment, with other non-related parties holding the remaining interests in the investment. RGI’s investment in the ECV is 45%. As a result of entering this transaction, the Company committed an aggregate amount of €7,800 (or $8,107 based on the Euro/U.S. dollar exchange rate of €1.0000: $1.0393 as of December 31, 2024), due in five installments over a period of 33 months, matching the stages of the ECV’s building process. The first installment amounting to $2,464 was paid on August 7, 2024, and the second installment amounting to $1,251 was paid on October 31, 2024. In assessing the accounting treatment for this transaction, the Company evaluated ASC 810 “Consolidation” and concluded that RGI is a VIE and that the Company does not individually have the power to direct the activities of the VIE that most significantly affect its performance. As of December 31, 2024, the noncontrolling interest of 49% into RGI was accounted for under the equity method due to the Company’s significant influence over RGI.



As of December 31, 2024, the investment in RGI amounted to $3,588 and is presented in “Equity method investment” in the accompanying consolidated balance sheet. The investment figure includes certain capitalized expenses as well a translation adjustment reserve. For the year ended December 31, 2024, the loss for this investment amounted to $142 and is presented in “Loss on equity method investment” in the accompanying consolidated statement of operations. The Company’s maximum exposure to a loss as a result of its investment in RGI, is limited to its committed amount in this investment.

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Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
9.
Financial Instruments:

The guidance for fair value measurements applies to all assets and liabilities that are being measured and reported on a fair value basis. This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The same guidance requires that assets and liabilities carried at fair value should be classified and disclosed in one of the following three categories based on the inputs used to determine its fair value:


 •
Level 1: Quoted market prices in active markets for identical assets or liabilities;

•
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data;

•
Level 3: Unobservable inputs that are not corroborated by market data.

(a)
Significant Risks and Uncertainties, including Business and Credit Concentration

The Company places its temporary cash investments, consisting mostly of deposits, primarily with high credit qualified financial institutions. The Company performs periodic evaluations of the relative credit standing of those financial institutions that are considered in the Company’s investment strategy. The Company limits its credit risk with accounts receivable by performing ongoing credit evaluations of its customers’ financial condition and generally does not require collateral for its accounts receivable and does not have any agreements to mitigate credit risk.

(b)
Fair Value of Financial Instruments

The fair values of the financial instruments shown in the consolidated balance sheet as of December 31, 2024 and 2023, represent management’s best estimate of the amounts that would be received to sell those assets or that would be paid to transfer those liabilities in an orderly transaction between market participants at that date. These fair value measurements maximize the use of observable inputs. However, in situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects the Company’s own judgments about the assumptions that market participants would use in pricing the asset or liability. Those judgments are developed by the Company based on the best information available in the circumstances.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

a.
Cash and cash equivalents, accounts receivable trade, other current assets, prepaid expenses, trade accounts and other payables and accrued liabilities: the carrying amounts approximate fair value because of the short maturity of these instruments. The carrying value approximates the fair market value for interest bearing cash classified as restricted cash, non-current.
b.
Long-term debt and other financial liabilities: The carrying value of long-term debt and other financial liabilities with variable interest rates approximates the fair value as the long-term debt and other financial liabilities bear interest at floating interest rate.
c.
The aggregate fair value of Gloriuship (classified as “Vessel held for sale” in the accompanying consolidated balance sheet as of December 31, 2024) on the sale agreement was written down to its fair value based on the agreed sale price, net of commission of $14,880 and an impairment loss of $828 was recognized (Level 2).

10.
Commitments and Contingencies:

Contingencies

Various claims, lawsuits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims with suppliers relating to the operations of the Company’s vessels. As of December 31, 2024, management is not aware of any material claims or contingent liabilities, which have not been disclosed, or for which a provision has not been established in the accompanying consolidated financial statements.

The Company accrues for the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any such claims or contingent liabilities that should be disclosed, or for which a provision should be established in the accompanying consolidated financial statements. The Company is covered for liabilities associated with the individual vessels’ actions to the maximum limits as provided by Protection and Indemnity (P&I) Clubs, members of the International Group of P&I Clubs.

F-30
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Commitments

The Company operates certain of its vessels under lease agreements. Time charters typically may provide for charterers’ options to extend the lease terms and termination clauses. The Company’s time charters duration was approximately 2 to 13 months and extension periods vary from 6 to 15 months. In addition, the time charters contain termination clauses which protect either the Company or the charterers from material adverse events. Variable lease payments in the Company’s time charters vary based on changes on freight market index. The Company has the option to convert some of these variable lease payments to fixed based on the prevailing Capesize and Panamax forward freight agreement rates.

As at December 31, 2024, the Company operated certain of its vessels under time charter agreements, considered as operating leases accounted for as per ASC 842 requirements.

As at December 31, 2024, an amount of $18,379 related to the Company’s future minimum contractual charter revenue for the year ending December 31, 2025, based on vessels committed to non-cancelable time charter contracts. For index-linked time charter contracts the calculation was made using the charter rates that prevail at the balance sheet date for index-linked time charters and the fixed rates for fixed periods time charters (these amounts do not include any assumed off-hire).

As at December 31, 2024, the Company has an option to purchase the Nisea at the end of 18-month bareboat charter for $16,620 (Note 6).

11.
Capital Structure:

(a)
Preferred Stock

The Company is authorized to issue up to 100,000,000 registered shares of preferred stock with a par value of $0.0001. The Board of Directors of the Company is expressly granted the authority to issue preferred shares and to establish such series of preferred shares with such designations, preferences and relative participating, rights, qualifications, limitations or restrictions at it determines.

Series A Preferred Shares

Prior to the Spin-Off, United entered into a Shareholders Rights Agreement, or the Rights Agreement, with American Stock Transfer & Trust Company, LLC, as Rights Agent. Under the Rights Agreement, United will declare a dividend payable of one preferred stock purchase right, or Right, for each share of common stock outstanding immediately prior to the Spin-Off. Each Right entitles the registered holder to purchase from United one one-thousandth of a share of Series A Preferred Stock, par value $0.0001, at an exercise price of $40.00 per share. The Rights will separate from the common stock and become exercisable only if a person or group acquires beneficial ownership of 10% (15% in the case of a passive institutional investor) or more of United’s common stock (including through entry into certain derivative positions) in a transaction not approved by the Board of Directors of the Company. In that situation, each holder of a Right (other than the acquiring person, whose Rights will become void and will not be exercisable) will have the right to purchase, upon payment of the exercise price, a number of shares of United’s common stock having a then-current market value equal to twice the exercise price. In addition, if the Company is acquired in a merger or other business combination after an acquiring person acquires 10% (15% in the case of a passive institutional investor) or more of United’s common stock, each holder of the Right will thereafter have the right to purchase, upon payment of the exercise price, a number of shares of common stock of the acquiring person having a then-current market value equal to twice the exercise price. The acquiring person will not be entitled to exercise these Rights. Until a Right is exercised, the holder of a Right will have no rights to vote or receive dividends or any other shareholder rights. On December 27, 2023, the Company’s Board of Directors approved an amendment and restatement of the Rights Agreement to make certain technical or ministerial changes. As at December 31, 2024, no Rights were exercised.

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Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Series B Preferred Shares

As at December 31, 2024, the Company had 40,000 Series B Preferred Shares issued and outstanding with par value $0.0001 per share. The Series B Preferred Shares were issued on July 5, 2022, to the Company’s Chief Executive Officer, considered a related party, for a total cash consideration of $NIL. The issuance of the Series B Preferred Shares was approved by a special independent committee of the Board of Directors of the Company which obtained a fairness opinion from an independent financial advisor regarding the value of the Series B Preferred Shares. Each Series B Preferred Shares entitles the holder to 25,000 votes per share on all matters submitted to a vote of the shareholders of the Company, provided however, that no holder of Series B Preferred Shares may exercise voting rights pursuant to Series B Preferred Shares that would result in the aggregate voting power of any beneficial owner of such shares and its affiliates to exceed 49.99% of the total number of votes eligible to be cast on any matter submitted to a vote of shareholders of the Company. The holder of Series B Preferred Shares has no special voting or consent rights and shall vote together as one class with the holders of the common shares on all matters put before the shareholders. The Series B Preferred Shares are not convertible into common shares or any other security, are not redeemable, are not transferable and have no dividend rights. Upon any liquidation, dissolution or winding up of the Company, the Series B Preferred Shares will rank pari-passu with the common shareholders and shall be entitled to receive a payment equal to the par value of $0.0001 per share. The Series B Preferred Shares holder has no other rights to distributions upon any liquidation, dissolution or winding up of the Company.

Series C Preferred Shares

On July 5, 2022, the Company issued 5,000 of its Series C Preferred Shares to Seanergy in exchange for $5,000 working capital contribution. On July 26, 2022, the Company issued additional 5,000 Series C Preferred Share to Seanergy in exchange for $5,000 in cash in connection with the funding of the deposits payable for the four tanker vessels acquired. The Series C Preferred Shares had a cumulative preferred dividend accruing at the rate of 6.5% per annum payable in cash each quarter. The Company had the right, at its option, at any time on or after the date which was three months after the original date of issuance of the Series C Preferred Shares, to redeem the Series C Preferred Shares, in whole or from time to time in part, from any source of funds legally available for such purpose, at a price per Series C Preferred Share equal to 105% of the stated value plus accrued and unpaid dividends up to the date of redemption. The Series C Preferred Shares contained a liquidation preference equal to its stated value and were convertible into common shares at the holder’s option commencing upon the first anniversary of the original issue date, at a conversion price equal to the lesser of $9.00 and the 10-trading-day trailing VWAP (as defined in the agreement) of United’s common shares, subject to certain anti-dilution and other customary adjustments. Except under certain circumstances, a holder of Series C Preferred Shares would not convert its Series C Preferred Shares into common shares if such conversion would result in the holder beneficially owning greater than 29.9% of our outstanding common shares.

On November 28, 2022, the outstanding 10,000 Series C Preferred Shares were redeemed by United at a price equal to 105% of the original issue price for a total cash outflow of $10,500. Total dividends paid in respect with the Series C Preferred Shares amounted to $243 or $24.38 per share.

(b)
Common Stock

As at January 20, 2022, the date of the Company’s incorporation, the Company’s authorized share capital was 500 registered shares without par value, issued to Seanergy. On July 5, 2022, the aforesaid registered shares issued to the Parent were cancelled and the Company’s articles of incorporation were amended and restated. Under the Company’s amended and restated articles of incorporation, the Company’s authorized capital stock consists of 2,000,000,000 shares of common stock, par value $0.0001 per share, of which 1,512,004 common shares were issued and outstanding on July 5, 2022, immediately upon consummation of the Spin-Off (Note 3). As at December 31, 2024, the Company had 8,844,267 common shares issued and outstanding.

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Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)

 i)
Equity Offerings

On July 20, 2022, the Company sold 8,000,000 units, each unit consisting of one common share or pre-funded warrant (with an exercise price of $0.0001) in lieu of common shares and one Class A warrant to purchase one common share, under a registered direct offering at a price of $3.25 per unit, in exchange for gross proceeds of $26,000, or net proceeds of approximately $23,851. 6,800,000 common shares, 1,200,000 pre-funded warrants and 8,000,000 Class A warrants were issued in connection with the offering. As of December 31, 2022, all pre-funded warrants had been exercised.


 ii)
Dividends

On November 25, 2024, the Company declared a dividend of $0.075 per common share for the third quarter of 2024 to all shareholders of record as of December 27, 2024. The dividend amounted to $663 was paid on January 10, 2025 (Note 16) and is included in “Dividends payable” in the accompanying consolidated balance sheet.

On August 5, 2024, the Company declared a dividend of $0.075 per common share for the second quarter of 2024 to all shareholders of record as of September 27, 2024. The dividend amounted to $664 and was paid on October 10, 2024.

On May 23, 2024, the Company declared a dividend of $0.075 per common share for the first quarter of 2024 to all shareholders of record as of June 25, 2024. The dividend amounted to $676 and was paid on July 10, 2024.

On February 19, 2024, the Company declared a dividend of $0.075 per common share for the fourth quarter of 2023 to all shareholders of record as of March 22, 2024. The dividend amounted to $651 and was paid on April 10, 2024.

On November 14, 2023, the Company declared a dividend of $0.075 per common share for the third quarter of 2023 to all shareholders of record as of December 22, 2023. The dividend amounted to $652 was paid on January 10, 2024 and was included in “Dividends payable” in the accompanying consolidated balance sheet.

On August 1, 2023, the Company declared a dividend of $0.075 per common share for the second quarter of 2023 to all shareholders of record as of September 22, 2023. The quarterly dividend of $657 for the second quarter of 2023 was paid on October 6, 2023.

On May 17, 2023, the Company declared a dividend of $0.075 per common share for the first quarter of 2023 to all shareholders of record as of June 22, 2023. The quarterly dividend of $667 for first quarter of 2023 was paid on July 6, 2023.

On February 21, 2023, the Company declared the initiation of a regular quarterly dividend of $0.075 per common share and declared a dividend of $0.075 per common share for the fourth quarter of 2022 to all shareholders of record as of March 22, 2023. The quarterly dividend of $667 for the fourth quarter of 2022 was paid on April 6, 2023.

On January 10, 2023, the Company paid a previously declared special dividend of $1.00 per common share or $1,043 to all shareholders of record as of December 12, 2022, in connection with the profitable sale of two tanker vessels.

Total dividends declared in the years ended December 31, 2024 and December 31, 2023 amounted to $2,654 and $2,643, respectively.

F-33
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)

 iii)
Common stock buybacks

In October 2022, the Board of Directors of the Company authorized its third share repurchase plan under which the Company would repurchase up to $3,000 of its outstanding common shares through the period ended March 31, 2023. Substantially, no repurchases had been made as of December 31, 2022. This plan was extended in May 2023 through the period ended December 31, 2023, was further extended in December 2023 through the period ended December 31, 2024 and was further extended in December 2024 through the period ending December 31, 2025.

During 2024, the Company has repurchased 185,363 of its outstanding common shares at an average price of approximately $2.52 per share for a total of $469, inclusive of commissions and fees. All the repurchased shares were cancelled and restored to the status of authorized but unissued shares as of December 31, 2024.

During 2023, the Company has repurchased 264,813 of its outstanding common shares at an average price of approximately $2.54 and a total of $673, inclusive of commissions and fees. All the repurchased shares were cancelled and restored to the status of authorized but unissued shares as of December 31, 2023.

In September 2022, the Board of Directors of the Company authorized its second share repurchase plan under which the Company would repurchase up to $3,000 of its outstanding common shares through the period ended March 31, 2023. During 2022, the Company repurchased 1,427,753 of its outstanding common shares at an average price of approximately $2.09 pursuant to its share repurchase program for a total of $2,987, inclusive of commissions and fees. All the repurchased shares were cancelled and restored to the status of authorized but unissued shares as of December 31, 2022.

In August 2022, the Board of Directors of the Company authorized its first share repurchase plan under which the Company would repurchase up to $3,000 of its outstanding common shares through the period ended March 31, 2023. Up to September 30, 2022, the Company repurchased 1,862,038 of its outstanding common shares at an average price of approximately $1.62 pursuant to its share repurchase program for a total of $3,016, inclusive of commissions and fees. All the repurchased shares were cancelled and restored to the status of authorized but unissued shares as of December 31, 2022.

(c)
Warrants

All warrants are classified in equity, according to the Company’s accounting policy.

As of December 31, 2024, 6,962,770 Class A warrants remained outstanding.

During the year ended December 31, 2023, 779,200 shares were issued from Class A warrants’ exercises, for proceeds of $1,883. As of December 31, 2023, 6,962,770 Class A warrants remained outstanding. Following the payment of the special dividend of $1.00 per common share on January 10, 2023 (Note 11(b)(ii)), the exercise price of the Class A warrants was adjusted at a price of $2.25 per warrant effective on January 11, 2023, pursuant to the antidilution provisions of the warrant agreement. The warrants also contain a cashless exercise provision, whereby if at the time of exercise, there is no effective registration statement, then the warrants can be exercised by means of a cashless exercise as disclosed in the warrant’s agreement.

On July 20, 2022, the Company issued 8,000,000 Class A warrants under a registered direct offering to issue 8,000,000 units (see discussion above). The Class A warrants were exercisable upon issuance at an initial exercise price of $3.25 per share and expire in July 2027. During the year ended December 31, 2022, 258,030 shares were issued from Class A warrants’ exercises, for proceeds of $829.

F-34
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
12.
Vessel Revenue, net and Voyage Expenses:

Disaggregation of Revenue

The Company disaggregates its revenue from contracts with customers by the type of charter (time, pool agreements and spot charters). The following table presents the Company’s statement of operations figures derived from spot charter, time charters and pool agreements for the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022:

    Year ended

Year ended

From
January 20, 2022
through
  
 
   December 31, 2024     December 31, 2023    
December 31, 2022
 
Vessel revenues from time charters and pool agreements, net of commissions
     45,439       31,754      
13,548
  
Vessel revenues from spot charters, net of commissions
     -       4,313      
9,236
  
Total
     45,439       36,067      
22,784
  

Demurrage income for the years ended December 31, 2024, 2023 and for the period from January 20, 2022 through December 31, 2022 was $NIL, $512 and $229, respectively.

The amortization of the below and above market acquired time charters amounted to $308 and $146 as a deduction from and an addition to “Vessel revenue, net”, respectively during the period from inception, January 20, 2022, to December 31, 2022. As of December 31, 2022, the below and above market acquired time charters were fully amortized.

As of December 31, 2024 and 2023, the trade accounts receivable was $1,437 and $252, respectively, and related to time charters.

Deferred revenue represents cash received in advance of performance under the contract prior to the balance sheet date and is realized when the associated revenue is recognized under the contract in periods after such date. Deferred revenue as of December 31, 2024 and December 31, 2023 was $664 and $486 and relates entirely to ASC 842. As of December 31, 2024 and 2023, an amount of $731 and $NIL related to ballast bonus payments made by charterers for the ballast trip which are deferred and recognized on a straight line over the charter period.

As of December 31, 2024 and 2023, an amount of $NIL and $41 included in “Deferred revenue” and related to time charter arrangements was treated as lease modification and not accounted for as separate contract.

F-35
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
Charterers individually accounting for more than 10% of revenues for the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022:

Customer
  
2024
    2023  
2022
A
  
33%
 
 21%  
-
B
  
19%
 
 10%  
-
C
  
16%
 
 -  
-
D
  
-
 
 22%  
-
E
   -   12%   -
F
   -   12%   15%
G
   -   -   25%
H
  -   -   20%
I   -   -   19%
J   -   -   15%
Total
  
68%
 
 77%  
94%

Voyage Expenses

The following table presents the Company’s statement of operations’ figures derived from time charters, spot charters and for unfixed periods for the years ended December 31, 2024, 2023 and for the period from inception (January 20, 2022) through December 31, 2022:

    Year ended Year ended
From
January 20, 2022
through
  
    December 31, 2024     December 31, 2023     December 31, 2022  
Voyage expenses from time charters
     1,270       1,424      
178
  
Voyage expenses from spot charters
     -       1,039      
4,802
  
Voyage expenses for unfixed periods
     501       644       265  
Total
     1,771       3,107      
5,245
  

13.
Interest and Finance Costs:

Interest and finance costs are analyzed as follows:

    Year ended

Year ended

From
January 20, 2022
through
  
    December 31, 2024     December 31, 2023    
December 31, 2022
  
Interest on long-term debt and other financial liabilities
    
6,072
      
5,184
      
2,045
  
Interest on finance lease liability
    
1,345
      
1,158
      
-
  
Amortization of debt finance costs and debt discounts
    
727
      
781
      
352
  
Other
    
272
      
60
      
55
  
Total
    
8,416
      
7,183
      
2,452
  

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Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
14.
Earnings / (loss) per Share:

The calculation of net (loss) / income per common share is summarized below:

    Year ended

Year ended

From
January 20, 2022
through
  
 
   December 31, 2024

December 31, 2023

December 31, 2022
  
 
                  
Net (loss) / income
 
$
(3,383
)
   $ 221    
$
37,490
  
Less: Dividends on Series C preferred shares
    
-
       -      
(743
)
Less: Dividends to non-vested participating securities
    
-
       (95 )    
(667
)
Less: Undistributed earnings to non-vested participating securities
    
-
       -      
(994
)
Net (loss) / income attributable to common shareholders, basic
  
$
(3,383
)
   $ 126    
$
35,086
  
 
                        
Undistributed earnings to non-vested participating securities
  
$
-
     $ -    
$
994
  
Undistributed earnings reallocated to non-vested participating securities
    
-
       -      
(621
)
Effect of Series C preferred shares
    
-
       -      
476
  
Net (loss) / income attributable to common shareholders, diluted
  
$
(3,383
)
   $ 126    
$
35,935
  
 
                        
Weighted average common shares outstanding – basic
    
8,711,951
       8,359,487      
4,503,397
  
Effect of dilutive securities:
                        
Dilutive effect of Series C preferred shares
    
-
       -      
2,796,164
  
Weighted average common shares outstanding – diluted
    
8,711,951
       8,359,487      
7,299,561
  
 
                        
Net (loss) / income per share attributable to common shareholders, basic
  
$
(0.39
)
   $ 0.02    
$
7.79
  
Net (loss) / income per share attributable to common shareholders, diluted
  
$
(0.39
)
   $ 0.02    
$
4.92
  

The Company calculates basic earnings per share in conformity with the two-class method required for companies with participating securities. The calculation of basic earnings per share does not consider the non-vested shares as outstanding until the time-based vesting restrictions have lapsed.

Net (loss) / income attributable to common shareholders for the years ended December 31, 2024 and 2023 is adjusted by the amount of dividends on non-vested participating securities (if any). Undistributed income to non-vested participating securities was not calculated for the years ended December 31, 2024 and 2023, because doing so would result in distributed income in excess of net income, thus resulting in undistributed losses.

Net income attributable to common shareholders for the period from January 20, 2022 through December 31, 2022 is adjusted by the amount of dividends on Series C Preferred Shares and non-vested participating securities and corresponding undistributed income to non-vested participating securities. The Company calculated diluted earnings per share in conformity with the two-class method required for companies with participating securities since the two-class method was more dilutive. For the period from January 20, 2022 through December 31, 2022, the computation of diluted earnings per share reflects the potential dilution from conversion of preferred convertible stock, which were outstanding from their issuance and up to their redemption, calculated with the “if converted” method described above and capped as per their respective contractual terms, which resulted in 2,796,164 incremental shares.

For the years ended December 31, 2024 and 2023 and for the period from January 20, 2022 through December 2022, securities that could potentially dilute basic earnings per share in the future that were not included in the computation of diluted earnings per share, because to do so would have anti-dilutive effect, are any incremental shares resulting from the outstanding warrants calculated with the treasury stock method.

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Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
15.
Equity Incentive Plan:

Prior to consummation of the Spin-Off, the Company’s Board of Directors adopted an Equity Incentive Plan, or the Plan, pursuant to which the Company could issue up to 150,000 common shares. On October 14, 2022, the Plan was amended and restated to increase the aggregate number of shares of the common stock reserved for issuance under the Plan to 1,500,000 shares. On December 28, 2022, the Plan was further amended and restated to increase the aggregate number of shares of the common stock reserved for issuance under the Plan to 2,000,000 shares.

On March 27, 2024, the Compensation Committee of the Company’s board of directors approved the amendment and restatement of the 2022 Equity Incentive Plan to increase the aggregate number of common shares reserved for issuance under the plan to 400,000 shares and granted awards under the plan to the Company’s directors and certain employees of the Company’s service providers of an aggregate of 335,000 restricted common shares. Of the total 335,000 shares issued, 260,000 shares were granted to the members of the Company’s board of directors, 65,000 shares were granted to certain employees of the Company’s service providers (Note 3) and 10,000 shares were granted to the sole director of the Company’s commercial manager, a non-employee. The fair value of each share on the grant date was $2.635. On March 27, 2024, 67,000 shares vested, while 100,500 shares vested on September 27, 2024 and 167,500 shares vested on March 27, 2025.

On October 14, 2022, the Compensation Committee of the Company granted an aggregate of 1,000,000 restricted shares of common stock pursuant to the Plan. Of the total 1,000,000 shares issued on October 14, 2022, 800,000 shares were granted to the members of the Board of Directors of the Company and 200,000 shares were granted to certain employees of the Company’s service providers (Note 3). The fair value of each share on the grant date was $2.28. On October 14, 2022, 333,344 shares vested, while 333,328 shares vested on January 5, 2023 and 333,328 shares vested on June 5, 2023.

On December 28, 2022, the Compensation Committee of the Company granted an aggregate of 700,000 restricted shares of common stock pursuant to the Plan. Of the total 700,000 shares issued on December 28, 2022, 580,000 shares were granted to the members of the Board of Directors and 120,000 shares were granted to certain employees of the Company’s service providers (Note 3). The fair value of each share on the grant date was $4.33. On December 28, 2022, 233,340 shares vested, while 233,330 shares vested on June 5, 2023 and 233,330 shares vested on October 5, 2023.

The related expense for shares granted to the Company’s Board of Directors and certain employees of the Company’s service providers for the years ended December 31, 2024, 2023 and from the period from inception, January 20, 2022, through December 31, 2022, amounted to $756, $2,522 and $2,789, respectively, and is included under “General and administration expenses” in the Company’s consolidated statements of operations. The related expense for shares granted to the sole director of the Company’s commercial manager for the years ended December 31, 2024, 2023 and from the period from inception January 20, 2022 through December 31, 2022 amounted to $23, $NIL, $NIL respectively.

Restricted shares during 2024 and 2023 are analyzed as follows:

   
Number
of Shares
    
Weighted
Average Grant
Date Price
  
Outstanding at December 31, 2022
    
1,133,316
    
$
3.12
  
Granted
    
-
      
-
  
Vested
    
(1,133,316
)
    
3.12
  
Forfeited
    -       -  
Outstanding at December 31, 2023
     -     $ -  
Granted     335,000       2.64  
Vested     (167,500 )     2.64  
Forfeited
     -      
 
Outstanding at December 31, 2024
    
167,500
    
$
2.64
  

F-38
Table of Contents
United Maritime Corporation
Notes To The Consolidated Financial Statements
(All amounts in footnotes in thousands of US Dollars, except for share and per share and warrants data, unless otherwise stated)
The unrecognized cost for the non-vested shares granted to the Company’s Board of Directors and certain employees of the Company’s service providers for the years ended December 31, 2024 and 2023 amounted to $104 and $NIL, respectively. On December 31, 2024, the weighted-average period over which the total compensation cost related to non-vested awards granted to the Company’s Board of Directors and certain employees of the Company’s service providers not yet recognized is expected to be recognized is 0.23 years.

16.
Subsequent Events

On January 10, 2025, the Company paid a regular quarterly cash dividend of $663 for the third quarter of 2024 to all shareholders of record as of December 27, 2024 (Note 11).

On March 17, 2025, the Company declared a regular quarterly cash dividend of $0.01 per share for the fourth quarter of 2024, which was paid on April 10, 2025 to all shareholders of record as of March 27, 2025.

On April 7, 2025, the Compensation Committee of our board of directors approved a further amendment and restatement of our 2022 Equity Incentive Plan to increase the aggregate number of common shares reserved for issuance under the plan to 400,000 shares, and granted awards under the plan of an aggregate of 275,000 restricted common shares to the members of the Company's board of directors and 85,000 common shares to certain of the Company’s service providers and to the sole director of the Company’s commercial manager, a non-employee. The fair value of each share on the grant date was $1.20. 79,500 shares vested on April 7, 2025, 113,000 shares will vest on October 7, 2025 and 167,500 shares will vest on April 7, 2026.

F-39
Table of Contents
United Maritime Predecessor


 
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F-1
Table of Contents
Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of United Maritime Corporation.

Opinion on the Financial Statements

We have audited the accompanying carve-out balance sheet of United Maritime Predecessor (the Predecessor Company) as of December 31, 2021, the related carve-out statements of operations, parent’s equity and cash flows for the period from January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020, and the related notes (collectively referred to as the “carve-out financial statements”). In our opinion, the carve-out financial statements present fairly, in all material respects, the financial position of the Predecessor Company at December 31, 2021, and the results of its operations and its cash flows for the period from January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020, in conformity with U.S. generally accepted accounting principles.
Basis for Opinion

These financial statements are the responsibility of the Predecessor Company’s management. Our responsibility is to express an opinion on the Predecessor Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Predecessor 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. The Predecessor Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Predecessor Company’s internal control over financial reporting. Accordingly, we express no such opinion.

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.
/s/ Ernst & Young (Hellas) Certified Auditors Accountants S.A.

We  have served as the Predecessor Company’s auditor since 2021.

Athens, Greece

April 4, 2023

F-2
Table of Contents
 United Maritime Predecessor
Carve-out Balance Sheet
December 31, 2021
(In US Dollars)

   
Notes
    
2021
  
ASSETS
            
Current assets:
            
Cash and cash equivalents
    
2
      
765,484
  
Accounts receivable trade
    
2
      
70,000
  
Inventories
    
2
      
99,325
  
Prepaid expenses
            
59,461
  
Total current assets
            
994,270
  
                 
Fixed assets:
                
Vessels, net
    
5
      
12,280,271
  
Total fixed assets
            
12,280,271
  
                 
Other non-current assets:
                
Deferred charges and other long-term investments, non-current
    
2
      
155,549
  
TOTAL ASSETS
            
13,430,090
  
                 
LIABILITIES AND PARENT EQUITY
                
Current liabilities:
                
Current portion of long-term debt, net of deferred finance costs of $72,926
    
6
      
1,177,074
  
Trade accounts and other payables
            
268,429
  
Accrued liabilities
            
309,611
  
Deferred revenue
    
2
      
326,374
  
Total current liabilities
            
2,081,488
  
                 
Non-current liabilities:
                
Long-term debt, net of current portion and deferred finance costs of $46,330
    
6
      
4,203,670
  
Other liabilities, non-current
            
104,554
  
Total liabilities
            
6,389,712
  
                 
Commitments and contingencies
    
8
       -  
                 
PARENT EQUITY
                
Parent investment, net
    
4
      
7,868,678
  
Accumulated deficit
            
(828,300
)
Parent equity, net
            
7,040,378
  
                 
TOTAL LIABILITIES AND PARENT EQUITY
            
13,430,090
  

The accompanying notes are an integral part of these carve-out financial statements.

F-3
Table of Contents
United Maritime Predecessor
Carve-out Statements of Operations
For the period from January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020
(In US Dollars)

   
Notes
    
From
January 1, 2022
through July 5, 2022
    
2021
    
2020
  
Revenues:
                        
Vessel revenue
    
2
      
2,445,238
      
7,786,022
      
4,338,076
  
Commissions - related party
    
3
      
(29,479
)
    
(97,695
)
    
(53,515
)
Commissions
            
(88,436
)
    
(293,086
)
    
(160,545
)
Vessel revenue, net
            
2,327,323
      
7,395,241
      
4,124,016
  
Expenses:
                                
Voyage expenses
    
2
      
(440,132
)
    
(144,614
)
    
(132,796
)
Vessel operating expenses
            
(1,099,880
)
    
(2,306,600
)
    
(1,973,636
)
Management fees - related party
    
3
      
(136,225
)
    
(237,250
)
    
(237,900
)
Management fees
            
(65,937
)
    
(105,000
)
    
(101,850
)
General and administration expenses
            
(341,309
)
    
(613,399
)
    
(300,705
)
Amortization of deferred dry-docking costs
            
(266,901
)
    
(316,450
)
    
(317,317
)
Depreciation
    
5
      
(400,285
)
    
(756,765
)
    
(758,839
)
Operating (loss) / income
            
(423,346
)
    
2,915,163
      
300,973
  
Other (expenses) / income, net:
                                
Interest and finance costs
    
9
      
(323,788
)
    
(743,687
)
    
(708,445
)
Gain on debt refinancing
    
6
      
-
      
-
      
1,490,601
  
Interest and other income
            
-
      
-
      
9,932
  
Foreign currency exchange gain / (losses), net
            
10,490
      
(1,211
)
    
(1,844
)
Total other (expenses) / income, net
            
(313,298
)
    
(744,898
)
    
790,244
  
Net (loss) / income
            
(736,644
)
    
2,170,265
      
1,091,217
  

The accompanying notes are an integral part of these carve-out financial statements.

F-4
Table of Contents
United Maritime Predecessor
Carve-out Statements of Parent’s Equity
For the period January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020
(In US Dollars)

   
Parent
Investment, Net
    
Accumulated
Deficit
    
Total Equity
  
                   
Balance, January 1, 2020
    
8,349,786
      
(4,089,782
)
    
4,260,004
  
Parent investment, net (Note 4)
    
1,960,687
      
-
      
1,960,687
  
Net income
    
-
      
1,091,217
      
1,091,217
  
Balance, December 31, 2020
    
10,310,473
      
(2,998,565
)
    
7,311,908
  
Parent investment, net (Note 4)
    
(2,441,795
)
    
-
      
(2,441,795
)
Net income
    
-
      
2,170,265
      
2,170,265
  
Balance, December 31, 2021
    
7,868,678
      
(828,300
)
    
7,040,378
  
Parent investment, net (Note 4)
    
1,253,526
      
-
      
1,253,526
  
Net loss
    
-
      
(736,644
)
    
(736,644
)
Balance, July 5, 2022
    
9,122,204
      
(1,564,944
)
    
7,557,260
  

The accompanying notes are an integral part of these carve-out financial statements.

F-5
Table of Contents
United Maritime Predecessor
Carve-out Statements of Cash Flows
For the period from January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020
(In US Dollars)

   
From
January 1, 2022
through July 5, 2022
    
2021
    
2020
  
Cash flows from operating activities:
                  
Net (loss) / income
    
(736,644
)
    
2,170,265
      
1,091,217
  
Adjustments to reconcile net (loss) / income to net cash (used in) / provided by operating activities:
                        
Depreciation
    
400,285
      
756,765
      
758,839
  
Amortization of deferred dry-docking costs
    
266,901
      
316,450
      
317,317
  
Amortization of deferred finance charges and other finance costs
    
44,308
      
101,289
      
96,300
  
Gain on debt refinancing
    
-
      
-
      
(1,490,601
)
Changes in operating assets and liabilities:
                        
Accounts receivable trade
    
(48,728
)
    
(70,000
)
    
480,769
  
Inventories
    
(16,562
)
    
(45,190
)
    
(3,354
)
Prepaid expenses
    
40,123
      
(12,132
)
    
3,223
  
Deferred charges, non-current
    
(3,241,630
)
    
-
      
-
  
Trade accounts and other payables
    
2,832,156
      
133,888
      
(1,932,686
)
Accrued liabilities
    
124,100
      
102,770
      
111,226
  
Deferred revenue
    
(262,734
)
    
203,232
      
123,142
  
Net cash (used in) / provided by operating activities
    
(598,425
)
    
3,657,337
      
(444,608
)
Cash flows from investing activities:
                        
Vessel’s improvements
    
(454,585
)
    
(56,066
)
    
(10,782
)
Net cash used in investing activities
    
(454,585
)
    
(56,066
)
    
(10,782
)
Cash flows from financing activities:
                        
Parent investment, net
    
1,253,526
      
(2,441,795
)
    
1,960,687
  
Repayments of long term debt
    
(550,000
)
    
(800,000
)
    
(9,015,940
)
Proceeds from long term debt
    
-
      
-
      
6,500,000
  
Payments of financing costs
    
-
      
-
      
(175,695
)
Net cash provided by / (used in) financing activities
    
703,526
      
(3,241,795
)
    
(730,948
)
Net (decrease) / increase in cash and cash equivalents and restricted cash
    
(349,484
)
    
359,476
      
(1,186,338
)
Cash and cash equivalents and restricted cash at beginning of year
    
765,484
      
406,008
      
1,592,346
  
Cash and cash equivalents and restricted cash at end of year
    
416,000
      
765,484
      
406,008
  
                         
SUPPLEMENTAL CASH FLOW INFORMATION
                        
Noncash investing activities:
                        
Vessel’s improvements
     (495,668 )     (16,252 )     -  
                         
Cash paid during the year:
                        
Interest
    
288,254
      
624,221
      
454,583
  

The accompanying notes are an integral part of these carve-out financial statements.

F-6
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)

1.
Basis of Presentation and General Information:

United Maritime Corporation (the “Company” or “United”) was incorporated by Seanergy Maritime Holdings Corp. (or “Seanergy” or “Parent”) on January 20, 2022 under the laws of the Republic of the Marshall Islands, having a share capital of 500 registered shares, of no par value, issued to the Parent. The Company was formed to serve as the holding company of the following vessel-owning company which was a subsidiary of Seanergy (the “Subsidiary”, or “United Maritime Predecessor”):

•
Sea Glorius Shipping Co.

On July 5, 2022, the spin-off transaction was consumed and the Parent contributed the Subsidiary to United and, as the sole shareholder of the Company, distributed the Company’s common shares to its shareholders and series B preferred shares on a pro rata basis. Following the spin-off consummation, United Maritime Corporation and Seanergy are independent publicly traded companies.

The accompanying predecessor carve-out financial statements are those of the Subsidiary for all periods presented using the historical carrying costs of the assets and the liabilities of the ship-owning company above from the dates of its incorporation.

The Subsidiary is incorporated to provide global shipping transportation services through the ownership of vessels. The vessel is owned through a separate wholly-owned subsidiary.

Following Russia’s invasion of Ukraine in February 2022, the U.S., several European Union nations, the UK and other countries have announced sanctions against Russia. The sanctions announced by the U.S. and other countries against Russia include, among others, restrictions on selling or importing goods, services or technology in or from affected regions, travel bans and asset freezes impacting connected individuals and political, military, business and financial organizations in Russia, severing large Russian banks from U.S. and/or other financial systems, and barring some Russian enterprises from raising money in the U.S. market. The U.S., EU nations and other countries could impose wider sanctions and take other actions as a result of the war.  With uncertainty remaining at high levels with regards to the global impact of the sanctions already announced to date and the possibility of additional sanctions as well as retaliation measures from Russia’s side that may follow in the period to come, it is difficult to accurately assess the exact impact on the Subsidiary. To date, no apparent consequences have been identified on the Subsidiary’s business, nor any specific implications on any of its existing counterparties, including clients, suppliers and lenders. It should be noted however that since the Subsidiary employs Ukrainian seafarers, it may face problems in relation to their employment, repatriation, salary payments and be subject to claims to this respect. Notwithstanding the foregoing, it is possible that the war might eventually have an adverse effect our business, financial condition, results of operations and cash flows.

2.
Significant Accounting Policies:

(a)
Basis of Presentation

The accompanying predecessor carve-out financial statements include the accounts of the legal entity comprising the Subsidiary as discussed in Note 1. United Maritime Predecessor has historically operated as part of Parent and not as a standalone company. Financial statements representing the historical operations of Parent’s business have been derived from Parent’s historical accounting records and are presented on a carve-out basis. All revenues, costs, assets and liabilities directly associated with the business activity of United Maritime Predecessor are included in the financial statements. The financial statements are prepared in conformity with the U.S. generally accepted accounting principles and reflect the financial position, results of operations and cash flows associated with the business activity of the United Maritime Predecessor as they were historically managed.

F-7
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
The predecessor carve-out statements of operations also reflect intercompany expense allocations made to United Maritime Predecessor by Seanergy of certain general and administrative expenses from Parent (Note 4). However, amounts recognized by United Maritime Predecessor are not necessarily representative of the amounts that would have been reflected in the financial statements had the Subsidiary operated independently of the Parent as the Subsidiary would have had additional administrative expenses, including legal, professional, treasury and regulatory compliance and other costs normally incurred by a listed public entity. Management has estimated these additional administrative expenses to be $0.3 million, $0.6 million and $0.3 million, for the period from January 1, 2022 to July 5, 2022, and for the years ended December 31, 2021 and 2020, respectively. Both the United Maritime Predecessor and Seanergy consider the basis on which the expenses have been allocated to be a reasonable reflection of the utilization of services provided to or the benefit received by the Subsidiary during the periods presented. The allocations may not, however, reflect the expense the Subsidiary would have incurred as an independent, publicly traded company for the periods presented.

United Maritime Predecessor’s accounting pronouncements are in alignment with the Parent’s accounting pronouncement as adopted.

United Maritime Predecessor has no common capital structure for the combined business and, accordingly, has not presented historical earnings per share.

(b)
Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates include evaluation of relationships with other entities to identify whether they are variable interest entities, determination of vessel useful life and determination of vessel impairment.

(c)
Foreign Currency Translation

The Subsidiary’s functional currency is the United States dollar since the Subsidiary ‘s vessel operates in international shipping markets and therefore primarily transact business in U.S. Dollars. The Subsidiary ‘s books of accounts are maintained in U.S. Dollars. Transactions involving other currencies are translated into the United States dollar using exchange rates, which are in effect at the time of the transaction. At the balance sheet dates, monetary assets and liabilities, which are denominated in other currencies, are translated to U.S. Dollars at the foreign exchange rate prevailing at year-end. Gains or losses resulting from foreign currency translation are reflected in the carve-out statements of operations.

(d)
Concentration of Credit Risk

Financial instruments, which potentially subject the Subsidiary to significant concentrations of credit risk, consist principally of cash and cash equivalents and accounts receivable trade. The Subsidiary limits its credit risk with accounts receivable trade by performing ongoing credit evaluations of its customers’ financial condition.

(e)
Cash and Cash Equivalents

The Subsidiary considers time deposits and all highly liquid investments with an original maturity of three months or less to be cash equivalents.

F-8
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
(f)
Accounts Receivable Trade

Accounts receivable trade, at each balance sheet date, include receivables from charterers for hire, freight and demurrage billings, net of a provision for doubtful accounts. At each balance sheet date, all potentially uncollectible accounts are assessed individually for purposes of determining the appropriate provision for doubtful accounts. The Subsidiary also assessed the provisions of ASC 326, Financial Instruments—Credit Losses, by assessing the counterparties’ credit worthiness and concluded that there is no material impact for the period from January 1, 2022 through July 5, 2022 and as of December 31, 2021 and 2020, respectively.

(g)
Inventories

Inventories consist of lubricants. Inventory is measured at the lower of cost or net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Cost is determined by the first in, first out method.

(h)
Vessels

Vessels acquired as a part of a business combination are recorded at fair market value on the date of acquisition. Vessels acquired as asset acquisitions are stated at historical cost, which consists of the contract price less discounts, plus any material expenses incurred upon acquisition (delivery expenses and other expenditures to prepare for the vessel’s initial voyage). Vessels acquired from entities under common control are recorded at historical cost. Subsequent expenditures for conversions and major improvements are capitalized when they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Expenditures for routine maintenance and repairs are expensed as incurred.

In addition, other long-term investments, relating to vessels’ equipment not yet installed, are included in “Deferred charges and other-long term investments, non-current” in the carve-out balance sheet. Amounts paid (if any) for other-long term investments, non-current, refer to equipment for the vessels not yet installed, and are included in “Vessel’s improvements” under “Cash flows from investing activities” in the carve-out statements of cash flows.

(i)
Vessel Depreciation

Depreciation is computed using the straight-line method over the estimated useful life of the vessel, after considering the estimated salvage value. Management estimates the useful life of the Subsidiary’s vessel to be 25 years from the date of initial delivery from the shipyard. Salvage value is estimated by the Subsidiary by taking the cost of steel times the weight of the ship noted in lightweight ton (“LWT”). Salvage values are periodically reviewed and revised to recognize changes in conditions, new regulations or other reasons. Revisions of salvage values affect the depreciable amount of the vessels and affects depreciation expense in the period of the revision and future periods.

(j)
Impairment of Long-Lived Assets (Vessel)

The Subsidiary reviews its long-lived asset (vessel) for impairment whenever events or changes in circumstances, such as prevailing market conditions, obsolesce or damage to the asset, and business plans to dispose the vessel earlier than the end of its useful life indicate that the carrying amount of the vessel plus unamortized drydocking costs and cost of any equipment not yet installed, may not be recoverable. The volatile market conditions in the dry bulk market with decreased charter rates and decreased vessel market values are conditions that the Subsidiary considers indicators of a potential impairment for its vessel.

F-9
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
The Subsidiary determines undiscounted projected operating cash flows for its vessel and compares it to the vessel’s carrying value, plus unamortized dry-docking costs and cost of any equipment not yet installed. When the undiscounted projected operating cash flows expected to be generated by the use of the vessel and/or its eventual disposition are less than its carrying value, plus unamortized dry-docking costs and cost of any equipment not yet installed, the Subsidiary impairs the carrying amount of the vessel. Measurement of the impairment loss is based on the fair value of the asset as determined by independent valuators and use of available market data. The undiscounted projected operating cash inflows are determined by considering the charter revenues from existing time charters for the fixed days and an estimated daily time charter equivalent for the non-fixed days (based on a combination of one year charter rates estimates and the average of the trailing 10-year historical charter rates, excluding outliers) adjusted for commissions, expected off hires due to scheduled maintenance and estimated unexpected breakdown off hires. The undiscounted projected operating cash outflows are determined by applying various assumptions regarding vessel operating expenses and scheduled maintenance.

The Subsidiary’s assessment concluded that no impairment loss should be recorded for the period from January 1, 2022 to July 5, 2022 and for the years ended December 31, 2021 and December 31, 2020.

(k)
Dry-Docking and Special Survey Costs

The Subsidiary follows the deferral method of accounting for dry-docking costs and special survey costs whereby actual costs incurred are deferred and are amortized on a straight-line basis over the period through the expected date of the next dry-docking which is scheduled to become due in 2 to 3 years. Dry-docking costs which are not fully amortized by the next dry-docking period are expensed.

(l)
Commitments and Contingencies

Liabilities for loss contingencies, arising from claims, assessments, litigation, fines and penalties, environmental and remediation obligations and other sources are recorded when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

(m)
Revenue Recognition

Revenues are generated from time charters. A time charter is a contract for the use of a vessel as well as vessel operations for a specific period of time and a specified daily charter hire rate, which is generally payable in advance. A bareboat charter is a contract in which the vessel is provided to the charterer for a fixed period of time at a specified daily rate, which is generally payable in advance.

Time charter revenue is recorded over the term of the charter agreement as the service is provided and collection of the related revenue is reasonably assured. Under a time charter, revenue is adjusted for a vessel’s off hire days due to major repairs, dry dockings or special or intermediate surveys.

F-10
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
In February 2016, the FASB issued ASU No. 2016-–2 - Leases (ASC 842), and as amended, it requires lessees to recognize most leases on the carve-out balance sheet. The Subsidiary adopted ASC 842, as amended from time to time, retrospectively from January 1, 2018. The Subsidiary also elected to apply the additional and optional transition method to new and existing leases at the adoption date as well as all the practical expedients which allowed the Subsidiary’s existing lease arrangements, in which it was a lessee or lessor, classified as operating leases under ASC 840 to continue to be classified as operating leases under ASC 842. The Subsidiary assessed the time charter contracts and concluded that these contracts contain a lease with the related executory costs (insurance), as well as non-lease components to provide other services related to the operation of the vessel, with the most substantial service being the crew cost to operate the vessel. The Subsidiary concluded that the criteria for not separating lease and non-lease components of its time charter contracts are met, since (i) the time pattern of recognizing revenues for crew and other services for the operation of the vessels is similar to the time pattern of recognizing rental income, (ii) the lease component of the time charter contracts, if accounted for separately, would be classified as an operating lease, and (iii) the predominant component in its time charter agreements is the lease component. In this respect, the Subsidiary accounts for the combined component as an operating lease in accordance with ASC 842. The Subsidiary recognizes income from lease payments over the lease term on a straight-line basis. The Subsidiary recognizes income for variable lease payments in the period when changes in facts and circumstances on which the variable lease payments occur. Rental income on the Subsidiary’s time charterers is mostly calculated at an index linked rate based on the five T/C routes rate of the Baltic Capesize Index. In addition, the Subsidiary had the option to convert the index-linked rate to a fixed one for a period ranging between 2 and 12 months, based on the prevailing Capesize Forward Freight Agreement (“FFA”) rate for the selected period. The Subsidiary exercised such option and earned fixed rates for each of the last three quarters of 2021, after which it reverted to earn index-linked rate. On February 21, 2022, the Subsidiary exercised its option and converted the index-linked rate to a fixed rate until July 5, 2022. (Note 8).

Charterers individually accounting for more than 10% of revenues during the period from January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020 were:

Customer
  
From
January 1, 2022
through July 5, 2022
  
2021
  
2020
  
A
    
100%
    
100%
    
100%

Total
    
100%
    
100%
    
100%


Subsidiary’s vessel revenue, net figures derived from time charters for the period from January 1, 2022 to July 5, 2022 and for the years ended December 31, 2021 and 2020 was $2,327,323, $7,395,241 and $4,124,016, respectively.

Deferred revenue represents cash received in advance of performance under the contract prior to the balance sheet date and is realized when the associated revenue is recognized under the contract in periods after such date. The Deferred revenue is allocated on a straight-line basis over the minimum duration of each charter party, except for unearned revenue, which represents cash received in advance of services which have not yet been provided.

(n)
Commissions

Commissions, which include address and brokerage commissions, are recognized in the same period as the respective charter revenues. Address commissions to third parties are included in Commissions. Address commission to related parties are included in Commissions-related party. Brokerage commissions to third parties are included in Voyage expenses.

(o)
Voyage Expenses

Voyage expenses primarily consist of port, canal, bunker expenses and brokerage commissions that are unique to a particular charter and are paid for by the charterer under time charter agreements.

Subsidiary’s voyage expenses figures derived from time charters for the period ended from January 1, 2022 to July 5, 2022 and for the years ended December 31, 2021 and 2020 was $440,132, $144,614 and $132,796, respectively.

F-11
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
(p)
Repairs and Maintenance

All repair and maintenance expenses, including major overhauling and underwater inspection expenses are expensed in the year incurred. Such costs are included in Vessel operating expenses.

(q)
Finance Costs

Underwriting, legal and other direct costs incurred with the issuance of long-term debt or to refinance existing debt are deferred and amortized to interest expense over the life of the related debt using the effective interest method. Unamortized fees relating to loans repaid are expensed in the period the repayment is made. The Subsidiary presents unamortized deferred financing costs as a reduction of long-term debt in the accompanying carve-out balance sheet.

(r)
Income Taxes

Under the laws of the country of the Subsidiary’s incorporation and the vessel’s registration, the Subsidiary is not subject to tax on international shipping income; however, it is subject to registration and tonnage taxes, which are included in vessel operating expenses in the accompanying carve-out statements of operations.

The vessel-owning companies with vessels that have called on the United States are obliged to file tax returns with the Internal Revenue Service and pay tax at a rate of 4% on U.S.-source gross transportation income (generally, 50% of revenues from voyages to or from the U.S.) unless an exemption applies. The Subsidiary’s vessel did not call on U.S. ports at any time between 2020 through July 5, 2022.

(s)
Fair Value Measurements

The Subsidiary follows the provisions of ASC 820 “Fair Value Measurements and Disclosures”, which defines fair value and provides guidance for using fair value to measure assets and liabilities. The guidance creates a fair value hierarchy of measurement and describes fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts. In accordance with the requirements of accounting guidance relating to Fair Value Measurements, the Subsidiary classifies and discloses its assets and liabilities carried at the fair value in one of the following categories:


 ○
Level 1: Quoted market prices in active markets for identical assets or liabilities;

○
Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data;

○
Level 3: Unobservable inputs that are not corroborated by market data.

(t)
Debt Modifications and Extinguishments

The Subsidiary follows the provisions of ASC 470-50, Modifications and Extinguishments, to account for all modifications or extinguishments of debt instruments, except debt that is extinguished through a troubled debt restructuring or a conversion of debt to equity securities of the debtor pursuant to conversion privileges provided in terms of the debt at issuance. This Subtopic also provides guidance on whether an exchange of debt instruments with the same creditor constitutes an extinguishment and whether a modification of a debt instrument should be accounted for in the same manner as an extinguishment. In circumstances where an exchange of debt instruments or a modification of a debt instrument does not result in extinguishment accounting, this Subtopic provides guidance on the appropriate accounting treatment. Costs associated with new loans or refinancing of existing loans, including fees paid to lenders or required to be paid to third parties on the lender’s behalf for obtaining new loans or refinancing existing loans, are recorded as deferred charges. Costs paid directly to third parties are expensed as incurred. Deferred financing costs are presented as a deduction from the corresponding liability. Such fees are deferred and amortized to interest and finance costs during the life of the related debt using the effective interest method. For loans repaid or refinanced that meet the criteria of debt extinguishment, the difference between the settlement price and the net carrying amount of the debt being extinguished (which includes any deferred debt issuance costs) is recognized as a gain or loss in the carve-out statements of operations.

F-12
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
(u)
Segment Reporting

The Subsidiary reports financial information and evaluates its operations by total charter revenues and not by the length of vessel employment, customer, or type of charter. As a result, management, including the chief operating decision maker, reviews operating results solely by revenue per day and operating results of the fleet and thus, the Subsidiary has determined that it operates under one reportable segment. Furthermore, a vessel is chartered, the charterer is free to trade the vessel worldwide and, as a result, disclosure of geographic information is impracticable.

(v)
Going Concern

Under ASC 205-40, Going Concern, management is required to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and on related required footnote disclosures.  For each reporting period, management is required to evaluate whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date the financial statements are issued.

Recent Accounting Pronouncements Adopted

The Subsidiary has adopted ASU No. 2021-05 Leases (Topic 842): Lessors-Certain Leases with Variable Lease Payments. The ASU amends the lessor lease classification guidance in ASC 842 for leases that include any amount of variable lease payments that are not based on an index or rate. If such a lease meets the criteria in ASC 842-10-25-2 through 25-3 for classification as either a sales-type or direct financing lease, and application of the sales-type or direct financing lease recognition guidance would result in recognition of a selling loss, then the amendments require the lessor to classify the lease as an operating lease. The adoption of ASU No. 2021-05 did not have an impact in the Subsidiary’s financial statements and related disclosures.

Recent Accounting Pronouncements – Not Yet Adopted

There are no recent accounting pronouncements the adoption of which is expected to have a material effect on the Company’s financial statements in the current or any future periods.

F-13
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
3.
Transactions with Related Parties:

The Subsidiary receives management services from Seanergy Management Corp. (“Seanergy Management”), a Marshall Islands corporation, a wholly owned subsidiary controlled by Seanergy. Under the services agreement entered into on May 15, 2017, United Maritime Predecessor pays Seanergy Management a commission of 1.25% on hire and freight revenue earned for chartering and post fixture services provided. The commission expense for the period from January 1, 2022 through July 5, 2022 and for the years ended December 31, 2021 and 2020 amounted to $29,479, $97,695 and $53,515, respectively, and is separately reflected under Commissions - related party in the accompanying carve-out statements of operations. In addition, under the same agreement, the Subsidiary pays Seanergy Management a daily fee of $650 for the provision of management services. United Maritime Predecessor pays Seanergy Shipmanagement, a subsidiary of Seanergy, a fixed management fee of $14,000 per vessel per month starting in June 2022. Management fees charged from January 1, 2022 through July 2022, and for the years ended 2021 and 2020 amounted to $136,225, $237,250 and $237,900, respectively, and are separately reflected as Management fees - related party in the accompanying carve-out statements of operations. United Maritime Predecessor’s amounts due to Seanergy Management as of December 31, 2021 are assumed by the Parent (Note 4).

4.
Parent Investment, Net:

As of December 31, 2021 and 2020, Parent investment, net consists of the amounts contributed by the Parent, to finance part of the acquisition cost of the vessel, commercial and management services, intercompany amounts due to or from the Parent for working capital purposes, which are forgiven and treated as contributions or distributions of capital and other general and administrative expenses allocated to the United Maritime Predecessor by Parent. Allocated general and administrative expenses include expenses of Parent such as executive’s cost, legal, treasury, regulatory compliance and other costs. These expenses were allocated on a pro rata basis, based on the number of ownership days of the Subsidiary’s vessel compared to the number of ownership days of the total Seanergy fleet. Such allocations are believed to be reasonable, but may not reflect the actual costs if the United Maritime Predecessor had operated as a standalone company. Capital contributions during 2020 and for the period from January 1,2022 through July 5, 2022, amounted to $1,960,687 and $1,253,526, respectively. Capital distributions for 2021 amounted to $2,441,795.

As part of Parent, United Maritime Predecessor is dependent upon Parent for all of its working capital and financing requirements, as Parent uses a centralized approach to cash management and financing of its operations. Financial transactions relating to United Maritime Predecessor are accounted for through the Parent equity account and reflected in the carve-out statements of Parent’s equity as an increase or decrease in Parent investment, net. Accordingly, none of Parent’s cash, cash equivalents or debt at the corporate level have been assigned to the United Maritime Predecessor in the financial statements. Parent equity, net represents Parent’s interest in the recorded net assets of the United Maritime Predecessor.

F-14
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
5.
Vessel, Net:

The amounts in the accompanying carve-out balance sheet are analyzed as follows:

   
December 31, 2021
  
Cost:
      
Beginning balance
    
16,925,546
  
- Additions
    
-
  
Ending balance
    
16,925,546
  
         
Accumulated depreciation:
        
Beginning balance
    
(3,888,510
)
- Additions
    
(756,765
)
Ending balance
    
(4,645,275
)
         
Net book value
    
12,280,271
  

On November 3, 2015, the Subsidiary acquired the Gloriuship for a purchase price of $16,833,520, which was financed through a loan with Hamburg Commercial Bank AG, or HCOB (formerly known as HSH Nordbank AG).

The Gloriuship is mortgaged to the secured loan with EnTrust (Note 6).

Vessel’s depreciation expense for the period from January 1, 2022 through July 5, 2022, and for the years ended December 31, 2021 and 2020, amounted to $400,285, $756,765 and $758,839, respectively, and is included in “Depreciation” in the accompanying carve- out statements of operations.

6.
Long-Term Debt:

The amounts in the accompanying carve-out balance sheet are analyzed as follows:

   
December 31, 2021
  
Secured loan facilities
    
5,500,000
  
Less: Deferred financing costs
    
(119,256
)
Total
    
5,380,744
  
Less – current portion
    
(1,177,074
)
Long-term portion
    
4,203,670
  

F-15
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
Existing Loan Facilities

New Entrust Facility

On July 15, 2020, following the repayment of the previous loan agreement, that resulted in “Gain on debt refinancing of $1,490,601, Seanergy’s two vessel owning subsidiaries of the Gloriuship and the Geniuship entered into a secured loan facility of $22,500,000 with Kroll Agency Services Limited, previously known as Lucid Agency Services Limited, and Kroll Trustee Services Limited, previously known as Lucid Trustee Services Limited, as facility agent and security agent, respectively, and certain nominees of EnTrust Global, as lenders, or the New EnTrust Facility, with Seanergy acting as the guarantor, and the amount of $22,500,000 was drawn down on July 16, 2020. The New EnTrust Facility was split into two tranches, secured by the Geniuship and the Gloriuship. Of the total amount, $16,000,000 was drawn under the Geniuship tranche and $6,500,000 under the Gloriuship tranche. The New EnTrust Facility is maturing in July 2025 and was originally secured by first priority mortgages over the Gloriuship and the Geniuship, general assignments covering earnings, insurances and requisition compensation of each vessel, account pledge agreements concerning the earnings account of each vessel, share pledge agreements concerning each vessel-owning subsidiary’s shares and relevant technical and commercial managers’ undertakings. On December 20, 2021, the vessel owning subsidiary of the Geniuship fully prepaid the amount of $14,617,500 outstanding under the Geniuship tranche of the New EnTrust Facility. As of December 31, 2021, the total amount outstanding under this facility was $5,500,000.

The annual principal payments required to be made after December 31, 2021, are as follows:

Year ended December 31,
  
Amount
  
2022
    
1,250,000
  
2023
    
1,400,000
  
2024
    
1,400,000
  
2025
    
1,450,000
  
2026    
-
  
Total
    
5,500,000
  

7.
Financial Instruments:

The guidance for fair value measurements applies to all assets and liabilities that are being measured and reported on a fair value basis. This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The same guidance requires that assets and liabilities carried at fair value should be classified and disclosed in one of the following three categories based on the inputs used to determine its fair value:


 •
Level 1: Quoted market prices in active markets for identical assets or liabilities;

•
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data;

•
Level 3: Unobservable inputs that are not corroborated by market data.

(a)
Significant Risks and Uncertainties, including Business and Credit Concentration

The Subsidiary places its temporary cash investments, consisting mostly of deposits, primarily with high credit qualified financial institutions. The Subsidiary performs periodic evaluations of the relative credit standing of those financial institutions that are considered in the Subsidiary’s investment strategy. The Subsidiary limits its credit risk with accounts receivable trade by performing ongoing credit evaluations of its customers’ financial condition and generally does not require collateral for its accounts receivable and does not have any agreements to mitigate credit risk.

F-16
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
(b)
Fair Value of Financial Instruments

The fair values of the financial instruments shown in the carve-out balance sheet as of December 31, 2021, represent management’s best estimate of the amounts that would be received to sell those assets or that would be paid to transfer those liabilities in an orderly transaction between market participants at that date.

Those fair value measurements maximize the use of observable inputs. However, in situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects the Subsidiary’s own judgments about the assumptions that mark et participants would use in pricing the asset or liability. Those judgments are developed by the Subsidiary based on the best information available in the circumstances.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

a)
Cash and cash equivalents, accounts receivable trade and trade accounts and other payables: the carrying amounts approximate fair value because of the short maturity of these instruments.
b)
Long-term debt: The fair value of fixed interest long-term debt is estimated using prevailing market rates as of the period end. The Subsidiary believes the terms of its fixed interest long-term debt are similar to those that could be procured as of December 31, 2021, and the carrying value of $5,500,000 is 3.11% lower than the fair market value of $5,670,844. The fair value of the fixed interest long-term debt has been obtained through Level 2 inputs (interest rate curves) of the fair value hierarchy.

8.
Commitments and Contingencies:

Commitments

As at July 5, 2022, future minimum contractual charter revenue based on vessel’s committed non-cancelable time charter contracts using the charter rates that prevail at the balance sheet date for index-linked time charters and the fixed rates for fixed period time charters (these amounts do not include any assumed off-hire) is estimated at $4,705,066.

Contingencies

Various claims, lawsuits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims with suppliers relating to the operations of the Subsidiary s vessel. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying financial statements.

The Subsidiary accrues for the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying financial statements. The Subsidiary is covered for liabilities associated with the individual vessel’s actions to the maximum limits as provided by Protection and Indemnity (P&I) Clubs, members of the International Group of P&I Clubs.

F-17
Table of Contents
United Maritime Predecessor
Notes to the Carve-out Financial Statements
July 5, 2022
(All amounts in US Dollars, unless otherwise stated)
9.
Interest and Finance Costs:

Interest and finance costs are analyzed as follows:

   
From
January 1, 2022
    
Year ended December 31,
  
   
through July 5, 2022
    
2021
    
2020
  
Interest on long-term debt
  

280,554
      
621,046
      
592,801
  
Amortization of debt issuance costs
    
44,308
      
101,289
      
96,300
  
Other, net
    
(1,074
)
    
21,352
      
19,344
  
Total
    
323,788
      
743,687
      
708,445
  

10.
Subsequent Events:

Contribution by Parent of the Subsidiary to United Maritime Corporation: On July 5, 2022, the spin-off transaction was materialized and the Subsidiary was contributed to the Company by the Parent. Following the spin-off consummation, United Maritime Corporation and Seanergy Maritime Holdings Corp. are independent publicly traded companies.


F-18
EX-2.4 2 ef20039046_ex2-4.htm EXHIBIT 2.4
Exhibit 2.4

DESCRIPTION OF SECURITIES
 
For the complete terms of our capital stock, please refer to our amended and restated articles of incorporation and our second amended and restated bylaws, which are filed as exhibits to the annual report of which this exhibit forms a part. The Business Corporations Act of the Republic of the Marshall Islands, as amended from time to time (“BCA”) may also affect the terms of our capital stock.
 
For purposes of the following description of capital stock, references to “us”, “we” and “our” refer only to United Maritime Corporation and not any of its subsidiaries.
 
Capitalized terms used but not defined herein have the meanings given to them in the annual report of which this exhibit forms a part.
 
Purpose
 
Our purpose, as stated in our amended and restated articles of incorporation, is to engage in any lawful act or activity for which corporations may now or hereafter be organized under the BCA. We are not aware of any limitations on the rights to own our securities, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our securities, imposed by foreign law or by our restated articles of incorporation or second amended and restated bylaws.
 
Authorized Capitalization
 
Our authorized capital stock consists of 2,000,000,000 shares of common stock, par value $0.0001 (“common shares”), and 100,000,000 shares of preferred stock, par value $0.0001, of which 2,000,000 shares are designated Series A Preferred Stock and 40,000 shares are designated Series B Preferred Stock. As of December 31, 2024, 8,844,267 common shares were issued and outstanding and as of April 7, 2025, 9,204,267 common shares were issued and outstanding. As of December 31, 2024 and as of April 7, 2025, no shares of Series A Preferred Stock and 40,000 shares of Series B Preferred Stock were outstanding. All of our shares of stock are in registered form.

Description of Common Shares

Subject to preferences that may be applicable to any outstanding preferred shares, holders of common shares are entitled to receive ratably all dividends, if any, declared by our board of directors out of funds legally available for dividends. Upon our dissolution or liquidation or the sale of all or substantially all of our assets, after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any, the holders of our common shares will be entitled to receive pro rata our remaining assets available for distribution. Holders of common shares do not have conversion, redemption or preemptive rights to subscribe to any of our securities. The rights, preferences and privileges of holders of common shares are subject to the rights of the holders of any preferred shares which we have issued or may issue in the future. Our common shares are not subject to any sinking fund provisions and no holder of any shares will be required to make additional contributions of capital with respect to our shares in the future.
 
Each outstanding share of common stock entitles the holder to one vote on all matters submitted to a vote of shareholders. Subject to preferences that may be applicable to any outstanding shares of preferred stock, holders of shares of common stock are entitled to receive ratably all dividends, if any, declared by our board of directors out of funds legally available for dividends. Upon our dissolution or liquidation or the sale of all or substantially all of our assets, after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any, the holders of our common stock will be entitled to receive pro rata our remaining assets available for distribution. Holders of common stock do not have conversion, redemption or preemptive rights to subscribe to any of our securities. The rights, preferences and privileges of holders of common stock are subject to the rights of the holders of our preferred stock.
 
Prior to our initial spin-off transaction, or the Spin-Off, Seanergy Maritime Holdings Corp., of the Republic of the Marshall Islands (“Parent”), as our sole shareholder approved the amendment of our articles of incorporation to effect one or more reverse stock splits of the shares of our common stock issued and outstanding at the time of the reverse split at a cumulative exchange ratio of between one-for-two and one-for-five hundred, with our board of directors to determine, in its sole discretion, whether to implement any reverse stock split, as well as the specific timing and ratio, within such approved range of ratios; provided that any such reverse stock split or splits are implemented prior to the third anniversary of the Spin-Off. While our board of directors will exercise its sole discretion as to whether and in what circumstances to effect any reverse stock split pursuant to this amendment of our articles of incorporation, the Parent’s determination to approve such amendment is intended to provide us the means to maintain compliance with the continued listing requirements of the Nasdaq Capital Market, in particular the bid price requirement, as well as to realize certain beneficial effects of a higher trading price for our common shares, including the ability to appeal to certain investors and potentially increased trading liquidity.
 
1
Description of Preferred Stock Purchase Rights

We have entered into a Shareholders Rights Agreement (as amended and restated, the “Rights Agreement”) with Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC), as Rights Agent.

Under the Rights Agreement, we declared a dividend payable of one preferred stock purchase right, or Right, for each share of common stock outstanding immediately prior to the Spin-Off. Each Right entitles the registered holder to purchase from us one one-thousandth of a share of Series A Participating Preferred Stock, par value $0.0001, at an exercise price of $40.00 per share. The Rights will separate from the common stock and become exercisable only if a person or group acquires beneficial ownership of 10% (15% in the case of a passive institutional investor) or more of our common stock (including through entry into certain derivative positions) in a transaction not approved by our board of directors. In that situation, each holder of a Right (other than the acquiring person, whose Rights will become void and will not be exercisable) will have the right to purchase, upon payment of the exercise price, a number of shares of our common stock having a then-current market value equal to twice the exercise price. In addition, if the Company is acquired in a merger or other business combination after an acquiring person acquires 10% (15% in the case of a passive institutional investor) or more of our common stock, each holder of the Right will thereafter have the right to purchase, upon payment of the exercise price, a number of shares of common stock of the acquiring person having a then-current market value equal to twice the exercise price. The acquiring person will not be entitled to exercise these Rights. Until a Right is exercised, the holder of a Right will have no rights to vote or receive dividends or any other shareholder rights.

The Rights may have anti-takeover effects. The Rights will cause substantial dilution to any person or group that attempts to acquire us without the approval of our board of directors. As a result, the overall effect of the Rights may be to render more difficult or discourage any attempt to acquire us. Because our board of directors can approve a redemption of the Rights or a permitted offer, the Rights should not interfere with a merger or other business combination approved by our board of directors.

We have summarized the material terms and conditions of the Rights Agreement and the Rights below. For a complete description of the Rights, we encourage you to read the Rights Agreement, which we have filed as an exhibit to the annual report of which this exhibit forms a part.

Detachment of the Rights

The Rights are attached to all certificates representing our currently outstanding common stock, or, in the case of uncertificated common shares registered in book entry form, which we refer to as “book entry shares,” by notation in book entry accounts reflecting ownership, and will attach to all common stock certificates and book entry shares we issue prior to the Rights distribution date that we describe below. The Rights are not exercisable until after the Rights distribution date and will expire at the close of business on July 1, 2032, unless we redeem or exchange them earlier as we describe below. The Rights will separate from the common stock and a Rights distribution date would occur, subject to specified exceptions, on the earlier of the following two dates:

 
•
the 10th day after public announcement that a person or group has acquired ownership of 10% (15% in the case of a passive institutional investor) or more of the Company's common stock; or
 
 
•
the 10th business day (or such later date as determined by the Company's board of directors) after a person or group announces a tender or exchange offer which would result in that person or group holding 10% (15% in the case of a passive institutional investor) or more of the Company's common stock.

“Acquiring person” is generally defined in the Rights Agreement as any person, together with all affiliates or associates, who beneficially owns 10% or more of the Company's common stock then outstanding, provided that none of Stamatios Tsantanis, his immediate family members, or any of their affiliates or associates will be considered an acquiring person. However, the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any subsidiary of the Company, any person holding shares of common stock for or pursuant to the terms of any such plan, or a passive institutional investor, are excluded from the definition of “acquiring person.” Inadvertent owners that would otherwise become an acquiring person, including those who would have this designation as a result of repurchases of common stock by us, will not become acquiring persons as a result of those transactions.

2
Our board of directors may defer the Rights distribution date in some circumstances, and some inadvertent acquisitions will not result in a person becoming an acquiring person if the person promptly divests itself of a sufficient number of shares of common stock.

Until the Rights distribution date: (i) the Rights will be evidenced by the certificates for shares of Common Stock registered in the names of the holders thereof or, in the case of uncertificated shares of Common Stock registered in book-entry form by notation in book entry accounts reflecting the ownership of such shares of Common Stock (which certificates and Book Entry Shares, as applicable, shall also be deemed to be Rights Certificates) and not by separate Rights Certificates and (ii) the right to receive Rights Certificates will be transferable only in connection with the transfer of shares of Common Stock.

As soon as practicable after the Rights distribution date, we will prepare, execute and send, or cause to be sent (and the Rights Agent will, if requested and provided with all necessary information and documents, in the discretion of the Rights Agent, at the expense of the Company, send or cause to be sent) by first-class, postage-prepaid mail, to each record holder of shares of Common Stock as of the close of business on the Rights distribution date, at the address of such holder shown on the records of the Company, or the transfer agent or registrar for the Common Stock, a Rights Certificate evidencing one Right for each share of Common Stock so held.

We will not issue Rights with any shares of common stock we issue after the Rights distribution date, except as our board of directors may otherwise determine.

Flip-In Event

If an Acquiring Person obtains beneficial ownership of 10% (15% in the case of a passive institutional investor) or more of the common shares, then each Right will entitle the holder thereof to purchase, for the Exercise Price, a number of common shares (or, in certain circumstances, cash, property or other securities of the Company) having a then-current market value of twice the Exercise Price. However, the Rights are not exercisable following the occurrence of the foregoing event until such time as the Rights are no longer redeemable by the Company, as further described below under “Redemption of Rights”.

Following the occurrence of an event set forth in preceding paragraph, all Rights that are or, under certain circumstances specified in the Rights Agreement, were beneficially owned by an Acquiring Person or certain of its transferees will be null and void.

Flip-Over Event

If, after an Acquiring Person obtains 10% (15% in the case of a passive institutional investor) or more of the common shares, (i) the Company merges into another entity; (ii) an acquiring entity merges into the Company; or (iii) the Company sells or transfers 50% or more of its assets, cash flow or earning power, then each Right (except for Rights that have previously been voided as set forth above) will entitle the holder thereof to purchase, for the Exercise Price, a number of common shares of the person engaging in the transaction having a then-current market value of twice the Exercise Price.

Anti-dilution

We may adjust the purchase price of the Preferred Shares, the number of Preferred Shares issuable and the number of outstanding Rights to prevent dilution that may occur from a stock dividend, a stock split, or a reclassification of the Preferred Shares or common shares. No adjustments to the Exercise Price of less than 1% will be made.

Redemption of Rights

We may redeem the Rights for $0.0001 per Right under certain circumstances. If we redeem any Rights, we must redeem all of the Rights. Once the Rights are redeemed, the only right of the holders of the Rights will be to receive the redemption price of $0.0001 per Right, payable, at the option of the Company, in cash, common shares or such other form of consideration as the Company's board of directors shall determine. The redemption price will be adjusted if we effect a stock dividend or a stock split.

3
Exchange of Rights

After a person or group becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of the outstanding common shares, our board of directors may extinguish the Rights by exchanging one common share or an equivalent security for each Right, other than Rights held by the Acquiring Person. In certain circumstances, we may elect to exchange the Rights for cash or other securities of the Company having a value approximately equal to one common share.

Amendment of Terms of Rights

The terms of the Rights and the Rights Agreement may be amended in any respect without the consent of the holders of the Rights for so long as the Rights are then redeemable. Thereafter, the terms of the Rights and the Rights Agreement may be amended without the consent of the holders of Rights, with certain exceptions, in order to (i) cure any ambiguities; (ii) correct or supplement any provision contained in the Rights Agreement that may be defective or inconsistent with any other provision therein; (iii) shorten or lengthen any time period pursuant to the Rights Agreement; or (iv) make changes that do not adversely affect the interests of holders of the Rights (other than an Acquiring Person or an affiliate or associate of an Acquiring Person).

Description of Preferred Stock

Our board of directors is authorized to provide for the issuance of preferred stock in one or more series with designations as may be stated in the resolution or resolutions providing for the issue of such preferred stock. At the time that any series of our preferred stock is authorized, our board of directors will fix the dividend rights, any conversion rights, any voting rights, redemption provisions, liquidation preferences and any other rights, preferences, privileges and restrictions of that series, as well as the number of shares constituting that series and their designation. Our board of directors could, without shareholder approval, cause us to issue preferred stock which has voting, conversion and other rights and preferences that could adversely affect the voting power and other rights of holders of our common stock and Series B Preferred Stock, or make it more difficult to effect a change in control. In addition, preferred stock could be used to dilute the share ownership of persons seeking to obtain control of us and thereby hinder a possible takeover attempt which, if our shareholders were offered a premium over the market value of their shares, might be viewed as being beneficial to our shareholders. The material terms of any series of preferred stock that we offer through a prospectus supplement will be described in that prospectus supplement.

Description of Series B Preferred Stock

The following description of the characteristics of the Series B Preferred Shares is a summary and does not purport to be complete and is qualified by reference to the Statement of Designation which is filed as an exhibit to the annual report of which this exhibit forms a part.

Voting. To the fullest extent permitted by law, each Series B preferred share entitles the holder hereof to 25,000 votes per share on all matters submitted to a vote of the shareholders of the Company, provided however, that no holder of Series B Preferred Shares may exercise voting rights pursuant to Series B Preferred Shares that would result in the aggregate voting power of any beneficial owner of such shares and its affiliates (whether pursuant to ownership of Series B Preferred Shares, common shares or otherwise) to exceed 49.99% of the total number of votes eligible to be cast on any matter submitted to a vote of shareholders of the Company. To the fullest extent permitted by law, the holder of Series B Preferred Shares shall have no special voting or consent rights and shall vote together as one class with the holders of the common shares on all matters put before the shareholders.

Conversion. The Series B Preferred Shares are not convertible into common shares or any other security.

Redemption. The Series B Preferred Shares are not redeemable.

Dividends. The Series B Preferred Shares have no dividend rights.

Transferability. All issued and outstanding Series B Preferred Shares must be held of record by one holder, and the Series B Preferred Shares shall not be transferred or sold without the prior approval of our board of directors.

Liquidation Preference. Upon any liquidation, dissolution or winding up of the Company, the Series B Preferred Shares will rank pari-passu with the common shareholders and shall be entitled to receive a payment equal to $0.0001 per share. The Series B preferred holder has no other rights to distributions upon any liquidation, dissolution or winding up of the Company.

4
Shareholder Meetings
 
Under our second amended and restated bylaws, annual shareholder meetings will be held at a time and place selected by our board of directors. The meetings may be held in or outside of the Marshall Islands. Special meetings of the shareholders, unless otherwise prescribed by law, may be called for any purpose or purposes at any time by the chairman of the board of directors, a majority of the entire board of directors, or the chief executive officer. Notice of every annual and special meeting of shareholders shall be given at least 15 but not more than 60 days before such meeting to each shareholder of record entitled to vote thereat.

Directors
 
Our directors are elected by the affirmative vote of a plurality of the votes cast at a meeting of the shareholders by the holders of shares entitled to vote in the election. Our amended and restated articles of incorporation and second amended and restated bylaws do not provide for cumulative voting in the election of directors.

The board of directors must consist of at least one member. Each director shall be elected to serve until the third succeeding annual meeting of shareholders and until his successor shall have been duly elected and qualified, except in the event of his death, resignation, removal, or the earlier termination of his term of office. The board of directors has the authority to fix the amounts which shall be payable to the members of our board of directors, and to members of any committee, for attendance at any meeting or for services rendered to us.

Election and Removal

Our second amended and restated bylaws require parties other than the board of directors to give advance written notice of nominations for the election of directors. The entire board of directors or any individual director may be removed, with cause, by the vote of two-thirds of the votes eligible to be cast by the holders of outstanding shares of our capital stock then entitled to vote at an election of directors. No director may be removed without cause by either the shareholders or the board of directors. Except as otherwise provided by applicable law, cause for the removal of a director shall be deemed to exist only if the director whose removal is proposed: (i) has been convicted, or has been granted immunity to testify in any proceeding in which another has been convicted, of a felony by a court of competent jurisdiction and that conviction is no longer subject to direct appeal; (ii) has been found to have been negligent or guilty of misconduct in the performance of his duties to the Company in any matter of substantial importance to the Company by (A) the affirmative vote of at least 80% of the directors then in office at any meeting of the board of directors called for that purpose or (B) a court of competent jurisdiction; or (iii) has been adjudicated by a court of competent jurisdiction to be mentally incompetent, which mental incompetence directly affects his ability to serve as a director of the Company. These provisions may discourage, delay or prevent the removal of incumbent officers and directors.

Super-Majority Approval Requirements

Our amended and restated articles of incorporation and second amended and restated bylaws provide that the vote of two-thirds of the votes eligible to be cast by holders of outstanding shares of our capital stock then entitled to vote at an election of directors is required to amend our bylaws or certain provisions of our articles of incorporation at any annual or special meeting of shareholders.

Dissenters’ Rights of Appraisal and Payment
 
Under the BCA, our shareholders generally have the right to dissent from the sale of all or substantially all of our assets not made in the usual course of our business and receive payment of the fair value of their shares. However, the right of a dissenting shareholder to receive payment of the appraised fair value of his shares is not available under the BCA for the shares of any class or series of stock, which shares at the record date fixed to determine the shareholders entitled to receive notice of and to vote at the meeting of the shareholders to act upon the agreement of merger or consolidation, were either (i) listed on a securities exchange or admitted for trading on an interdealer quotation system or (ii) held of record by more than 2,000 holders. In the event of any further amendment of our articles of incorporation, a shareholder also has the right to dissent and receive payment for his or her shares if the amendment alters certain rights in respect of those shares. The dissenting shareholder must follow the procedures set forth in the BCA to receive payment.

5
Shareholders’ Derivative Actions
 
Under the BCA, any of our shareholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the shareholder bringing the action is a holder of common shares both at the time the derivative action is commenced and at the time of the transaction to which the action relates.

Forum Selection

Our second amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the High Court of the Republic of Marshall Islands shall be the sole and exclusive forum for (i) any shareholders’ derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or employee of the Company to the Company or the Company’s shareholders, (iii) any action asserting a claim arising pursuant to any provision of the Business Corporations Act of the Republic of the Marshall Islands (as amended from time to time), or (iv) any action asserting a claim governed by the internal affairs doctrine. However, the enforceability of similar forum selection provisions in other companies’ governing documents has been challenged in legal proceedings, and it is possible that in connection with any action a court could find the forum selection provision contained in our second amended and restated bylaws to be inapplicable or unenforceable in such action. In particular, Section 27 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. In addition, Section 22 of the Securities Act, creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Shareholders’ derivative actions, including those arising under the Exchange Act or Securities Act, are subject to our forum selection provision. To the extent that the exclusive forum provision would apply to restrict the courts in which our shareholders may bring claims arising under the Exchange Act or the Securities Act and the rules and regulations thereunder, there is uncertainty as to whether a court would enforce such a provision. Investors cannot waive compliance with the federal securities laws and the rules and regulations promulgated thereunder. If a court were to find the forum selection provision to be inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business, financial condition and results of operations. Any person or entity holding, owning, or otherwise acquiring any shares of capital stock of us shall be deemed to have notice of and consented to the forum selection provisions in our second amended and restated bylaws. Although our forum selection provisions shall not relieve us of our statutory duties to comply with the federal securities laws and the rules and regulations thereunder, and our shareholders are not deemed to have waived our compliance with these laws, rules, and regulations, as applicable, our forum selection provisions may limit a shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage such lawsuits with respect to such claims. For more information regarding the risks connected to the forum selection provisions in our second amended and restated bylaws, see “Risk Factors—We may not achieve the intended benefits of having a forum selection provision if it is found to be unenforceable.”

Indemnification of Officers and Directors

Our second amended and restated bylaws provide that we must indemnify our directors, officers, employees and agents, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe their conduct was unlawful. We are also required to advance certain expenses (including attorney's fees and disbursements and court costs) to our directors and officers and we may carry directors' and officers' insurance providing indemnification for our directors and officers for some liabilities. We believe that these indemnification provisions and this insurance are useful to attract and retain qualified directors and officers.

The indemnification provisions in our second amended and restated bylaws may discourage shareholders from bringing a lawsuit against directors and officers for breach of their fiduciary duty. These provisions may also have the effect of reducing the likelihood of derivative litigation against directors and officers, even though such an action, if successful, might otherwise benefit us and our shareholders. In addition, an investment in our common shares may be adversely affected to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

6
Anti-takeover Provisions of our Charter Documents
 
Several provisions of our amended and restated articles of incorporation and second amended and restated bylaws may have anti-takeover effects. These provisions are intended to avoid costly takeover battles, lessen our vulnerability to a hostile change of control and enhance the ability of our board of directors to maximize shareholder value in connection with any unsolicited offer to acquire us. However, these anti-takeover provisions, which are summarized below, could also discourage, delay or prevent (1) the merger or acquisition of our company by means of a tender offer, a proxy contest or otherwise, that a shareholder may consider in its best interest and (2) the removal of incumbent officers and directors.

Classified Board of Directors

Our amended and restated articles of incorporation provide for the division of our board of directors into three classes of directors, with each class as nearly equal in number as possible, serving staggered, three-year terms. Approximately one-third of our board of directors will be elected each year. This classified board provision could discourage a third party from making a tender offer for our shares or attempting to obtain control of our company. It could also delay shareholders who do not agree with the policies of the board of directors from removing a majority of the board of directors for two years.

Election and Removal of Directors

Our amended and restated articles of incorporation and second amended and restated bylaws prohibit cumulative voting in the election of directors. Our second amended and restated bylaws require parties other than our board of directors to give advance written notice of nominations for the election of directors. Our second amended and restated bylaws also provide that our directors may be removed only for cause and only upon the affirmative vote of two-thirds of the votes eligible to be cast by holders of outstanding shares of our capital stock then entitled to vote at an election of directors. These provisions may discourage, delay or prevent the removal of incumbent officers and directors.

Limited Actions by Shareholders
 
Our second amended and restated bylaws provide that any action required or permitted to be taken by our shareholders must be effected at an annual or special meeting of shareholders or by the unanimous written consent of our shareholders.

Our second amended and restated bylaws provide that the chairman of the board of directors, a majority of the board of directors, or the chief executive officer may call special meetings of our shareholders and the business transacted at the special meeting is limited to the purposes stated in the notice. Accordingly, a shareholder may be prevented from calling a special meeting for shareholder consideration of a proposal over the opposition of our board of directors and shareholder consideration of a proposal may be delayed until the next annual meeting.

Our second amended and restated bylaws provide that shareholders seeking to nominate candidates for election as directors or to bring business before an annual meeting of shareholders must provide timely notice of their proposal in writing. Our second amended and restated bylaws also specify requirements as to the form and content of a shareholder’s notice. These provisions may impede shareholders’ ability to bring matters before an annual meeting of shareholders or make nominations for directors at an annual meeting of shareholders.

Blank Check Preferred Stock
 
Under the terms of our amended and restated articles of incorporation, our board of directors has authority, without any further vote or action by our shareholders, to issue up to 100,000,000 shares of blank check preferred stock. Our board of directors may issue shares of preferred stock on terms calculated to discourage, delay or prevent a change of control of our company or the removal of our management.
 
Business Combinations with Interested Shareholders
 
Although the BCA does not contain specific provisions regarding “business combinations” between companies organized under the laws of the Marshall Islands and “interested shareholders,” we will include these provisions in our amended and restated articles of incorporation. Specifically, our amended and restated articles of incorporation will prohibit us from engaging in a “business combination” with certain persons for three years following the date the person becomes an interested shareholder. Interested shareholders generally include:
 
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 •
any person who is the beneficial owner of 15% or more of our issued and outstanding voting stock; or
 

 •
any person who is our affiliate or associate and who held 15% or more of our issued and outstanding voting stock at any time within three years before the date on which the person's status as an interested shareholder is determined, and the affiliates and associates of such person.
 

 •
Subject to certain exceptions, a business combination includes, among other things:
 

 o
certain mergers or consolidations of us or any direct or indirect majority-owned subsidiary of ours;
 

 o
any sale, lease, exchange, mortgage, pledge, transfer or other disposition of our assets or of any subsidiary of ours having an aggregate market value equal to 10% or more of either the aggregate market value of all of our assets, determined on a combined basis, or the aggregate value of all of our issued and outstanding stock;
 

 o
certain transactions that result in the issuance or transfer by us of any stock of ours to the interested shareholder;
 

 o
any transaction involving us or any of our subsidiaries that has the effect of increasing the proportionate share of any class or series of stock, or securities convertible into any class or series of stock, of ours or any such subsidiary that is owned directly or indirectly by the interested shareholder or any affiliate or associate of the interested shareholder; and
 

 o
any receipt by the interested shareholder of the benefit directly or indirectly (except proportionately as a shareholder) of any loans, advances, guarantees, pledges or other financial benefits provided by or through us.
 

 •
These provisions of our amended and restated articles of incorporation do not apply to a business combination if:
 

 o
before a person became an interested shareholder, our board of directors approved either the business combination or the transaction in which the shareholder became an interested shareholder;
 

 o
upon consummation of the transaction which resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at least 85% of our voting stock issued and outstanding at the time the transaction commenced, other than certain excluded shares;
 

 o
at or following the transaction in which the person became an interested shareholder, the business combination is approved by our board of directors and authorized at an annual or special meeting of shareholders, and not by written consent, by the affirmative vote of the holders of at least two-thirds of our issued and outstanding voting stock that is not owned by the interest shareholder;
 

 o
the shareholder was or became an interested shareholder prior to the consummation of the transactions;
 

 o
a shareholder became an interested shareholder inadvertently and (i) as soon as practicable divested itself of ownership of sufficient shares so that the shareholder ceased to be an interested shareholder; and (ii) would not, at any time within the three-year period immediately prior to a business combination between us and such shareholder, have been an interested shareholder but for the inadvertent acquisition of ownership; or
 

 o
the business combination is proposed prior to the consummation or abandonment of and subsequent to the earlier of the public announcement or the notice required under our amended and restated articles of incorporation which (i) constitutes one of the transactions described in the following sentence; (ii) is with or by a person who either was not an interested shareholder during the previous three years or who became an interested shareholder with the approval of the board; and (iii) is approved or not opposed by a majority of the members of the board of directors then in office (but not less than one) who were directors prior to any person becoming an interested shareholder during the previous three years or were recommended for election or elected to succeed such directors by a majority of such directors. The proposed transactions referred to in the preceding sentence are limited to:
 
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 (i)
a merger or consolidation of us (except for a merger in respect of which, pursuant to the BCA, no vote of our shareholders is required);
 

 (ii)
a sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), whether as part of a dissolution or otherwise, of assets of us or of any direct or indirect majority-owned subsidiary of ours (other than to any direct or indirect wholly owned subsidiary or to us) having an aggregate market value equal to 50% or more of either the aggregate market value of all of our assets determined on a consolidated basis or the aggregate market value of all the issued and outstanding shares; or
 

 (iii)
a proposed tender or exchange offer for 50% or more of our issued and outstanding voting stock.
 
Class A Warrants
 
As of April 7, 2025, we had Class A Warrants to purchase up to 6,962,770 common shares outstanding. The following summary of certain terms and provisions of the Class A Warrants is not complete and is subject to, and qualified in its entirety by the provisions of the form of Class A Warrant, which is filed as exhibits to the annual report of which this exhibit forms a part. Prospective purchasers should carefully review the terms and provisions set forth in the form of Class A Warrant.
 
Exercisability. The Class A Warrants are exercisable at any time after their original issuance through July 20, 2027, the date that is five years after their original issuance. The Class A Warrants will be exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice and, at any time a registration statement registering the issuance of the common shares underlying the Class A Warrants under the Securities Act is effective and available for the issuance of such shares, or an exemption from registration under the Securities Act is available for the issuance of such shares, by payment in full in immediately available funds for the number of common shares purchased upon such exercise. If a registration statement registering the issuance of the common shares underlying the Class A Warrants under the Securities Act is not effective or available, the holder may, in its sole discretion, elect to exercise the Class A Warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of common shares determined according to the formula set forth in the Class A Warrant. No fractional common shares will be issued in connection with the exercise of a Class A Warrant. In lieu of fractional shares, we will pay the holder an amount in cash equal to the fractional amount multiplied by the exercise price.
 
Exercise Limitation. A holder will not have the right to exercise any portion of the Class A Warrants if the holder (together with its affiliates) would beneficially own in excess of 4.99% (or, upon election by a holder prior to the issuance of any warrants, 9.99%) of the number of shares of our common shares outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the warrants. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99%, upon at least 61 days’ prior notice from the holder to us with respect to any increase in such percentage.
 
Exercise Price. The exercise price per whole common share purchasable upon exercise of the Class A Warrants is $2.25 per share. The exercise price of the Class A Warrants may also be reduced to any amount and for any period of time at the sole discretion of our board of directors. The exercise price and number of common shares issuable upon exercise will adjust in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting our common shares.
 
Transferability. Subject to applicable laws, the Class A Warrants may be offered for sale, sold, transferred or assigned without our consent.
 
Exchange Listing. We do not intend to apply for the listing of the Class A Warrants on any stock exchange. Without an active trading market, the liquidity of the Class A Warrants will be limited.
 
Warrant Agent. The Class A Warrants are issued in registered form under a warrant agreement between Equiniti Trust Company, LLC (as successor to American Stock Transfer & Trust Company, LLC), as warrant agent, and us. The Class A Warrants shall initially be represented only by one or more global warrants deposited with the warrant agent, as custodian on behalf of The Depository Trust Company (DTC) and registered in the name of Cede & Co., a nominee of DTC, or as otherwise directed by DTC.
 
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Rights as a Shareholder. Except as otherwise provided in the Class A Warrants or by virtue of such holder’s ownership of our common shares, the holder of a Class A Warrant does not have the rights or privileges of a holder of our common shares, including any voting rights, until the holder exercises the warrant.
 
Fundamental Transactions. In the event of a fundamental transaction, as described in the Class A Warrants and generally including, with certain exceptions, any reorganization, recapitalization or reclassification of our common shares, the sale, transfer or other disposition of all or substantially all of our properties or assets, our consolidation or merger with or into another person, the acquisition of more than 50% of our outstanding common shares, or any person or group becoming the beneficial owner of 50% of the voting power represented by our outstanding common shares, the holders of the Class A Warrants will be entitled to receive upon exercise of the warrants the kind and amount of securities, cash or other property that the holders would have received had they exercised the warrants immediately prior to such fundamental transaction. Additionally, as more fully described in the Class A Warrant, in the event of certain fundamental transactions, the holders of the Class A Warrants will be entitled to receive consideration in an amount equal to the Black Scholes value of the Class A Warrants on the date of consummation of such transaction.
 
Governing Law. The Class A Warrants and Warrant Agreement are governed by New York law.
 
Transfer Agent
 
Equiniti Trust Company, LLC is the transfer agent and registrar for our common shares and the warrant agent for our Class A Warrants.
 
Listing
 
Our common shares (together with the related Rights) trade on the Nasdaq Capital Market under the symbol “USEA”.
 
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CERTAIN MARSHALL ISLANDS COMPANY CONSIDERATIONS
 
Our corporate affairs are governed by our amended and restated articles of incorporation, second amended and restated bylaws and the BCA. The provisions of the BCA resemble provisions of the corporation laws of a number of states in the United States, including Delaware. While the BCA also provides that it is to be interpreted according to the laws of the State of Delaware and other states with substantially similar legislative provisions, there have been few, if any, court cases interpreting the BCA in the Marshall Islands, and we cannot predict whether Marshall Islands courts would reach the same conclusions as Delaware or other courts in the United States. Accordingly, you may have more difficulty in protecting your interests under Marshall Islands law in the face of actions by our management, directors or controlling shareholders than would shareholders of a corporation incorporated in a U.S. jurisdiction that has developed a substantial body of case law. Furthermore, the Marshall Islands lacks a bankruptcy statute, and in the event of any bankruptcy, insolvency, liquidation, dissolution, reorganization or similar proceeding involving the Company, the bankruptcy laws of the United States or of another country having jurisdiction over the Company would apply. The following table provides a comparison between certain statutory provisions of the BCA and the Delaware General Corporation Law relating to shareholders’ rights.
 
Marshall Islands
​
​
Delaware
Shareholder Meetings
Held at a time and place as designated in the bylaws.
​
​
May be held at such time or place as designated in the certificate of incorporation or the bylaws, or if not so designated, as determined by the board of directors.
       
Special meetings of the shareholders may be called by the board of directors or by such person or persons as may be authorized by the articles of incorporation or by the bylaws.
​
​
Special meetings of the shareholders may be called by the board of directors or by such person or persons as may be authorized by the certificate of incorporation or by the bylaws.
       
May be held in or outside of the Marshall Islands.
​
​
May be held in or outside of Delaware.
       
Notice:
​
​
Notice:
       
 
Whenever shareholders are required to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, date and hour of the meeting and, unless it is an annual meeting, indicate that it is being issued by or at the direction of the person calling the meeting.
​
​
  
Whenever shareholders are required to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, if any, date and hour of the meeting, and the means of remote communication, if any.
           
 
A copy of the notice of any meeting shall be given personally or sent by mail not less than 15 nor more than 60 days before the meeting.
​
​
  
Written notice shall be given not less than 10 nor more than 60 days before the meeting.
           
Shareholders’ Voting Rights
 
Unless otherwise provided in the articles of incorporation, any action required by the BCA to be taken at a meeting of shareholders may be taken without a meeting if a consent or consents in writing, setting forth the action so taken, shall be signed by all the shareholders entitled to vote with respect to the subject matter thereof, or if the articles of incorporation so provide, by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
​
​
Any action required to be taken by a meeting of shareholders may be taken without a meeting if a consent for such action is in writing and is signed by shareholders having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
       
Any person authorized to vote may authorize another person or persons to act for him by proxy.
​
​
Any person authorized to vote may authorize another person or persons to act for him by proxy.

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Marshall Islands
​
​
Delaware
Unless otherwise provided in the articles of incorporation or the bylaws, a majority of shares entitled to vote constitutes a quorum. In no event shall a quorum consist of fewer than one-third of the common shares entitled to vote at a meeting.
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For stock corporations, the certificate of incorporation or bylaws may specify the number of shares required to constitute a quorum but in no event shall a quorum consist of less than one-third of shares entitled to vote at a meeting. In the absence of such specifications, a majority of shares entitled to vote shall constitute a quorum.
       
When a quorum is once present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders.
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When a quorum is once present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders.
       
The articles of incorporation may provide for cumulative voting in the election of directors.
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The certificate of incorporation may provide for cumulative voting in the election of directors.
       
Removal:
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Removal:
       
 
If the articles of incorporation or the bylaws so provide, any or all of the directors may be removed without cause by vote of the shareholders.
 
Any or all of the directors may be removed for cause by vote of the shareholders. The articles of incorporation or the specific provisions of a bylaw may provide for such removal by action of the board.
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Any or all of the directors may be removed, with or without cause, by the holders of a majority of the shares entitled to vote except: (1) unless the certificate of incorporation otherwise provides, in the case of a corporation whose board is classified, shareholders may effect such removal only for cause, or (2) if the corporation has cumulative voting, if less than the entire board is to be removed, no director may be removed without cause if the votes cast against such director’s removal would be sufficient to elect such director if then cumulatively voted at an election of the entire board of directors, or, if there be classes of directors, at an election of the class of directors of which such director is a part.
           
Directors
 
Number of board members can be changed by an amendment to the bylaws, by the shareholders, or by action of the board under the specific provisions of a bylaw.
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Number of board members shall be fixed by, or in a manner provided by, the bylaws, unless the certificate of incorporation fixes the number of directors, in which case a change in the number shall be made only by amendment to the certificate of incorporation.
       
The board of directors must consist of at least one member.If the board of directors is authorized to change the number of directors, it can only do so by a majority of the entire board of directors and so long as no decrease in the number shortens the term of any incumbent director.
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The board of directors must consist of at least one member.
       
Dissenter’s Rights of Appraisal
 
Shareholders have a right to dissent from any plan of merger, consolidation or sale of all or substantially all assets not made in the usual course of business, and receive payment of the fair value of their shares. However, the right of a dissenting shareholder under the BCA to receive payment of the appraised fair value of his shares is not available for the shares of any class or series of stock, which shares at the record date fixed to determine the shareholders entitled to receive notice of and to vote at the meeting of the shareholders to act upon the agreement of merger or consolidation or any sale or exchange of all or substantially all assets, were either (i) listed on a securities exchange or admitted for trading on an interdealer quotation system or (ii) held of record by more than 2,000 holders.
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Appraisal rights shall be available for the shares of any class or series of stock of a corporation in a merger or consolidation, subject to limited exceptions, such as a merger or consolidation of corporations listed on a national securities exchange in which listed shares are the offered consideration or if such shares are held of record by more than 2,000 holders.

12
Marshall Islands
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Delaware
A holder of any adversely affected shares who does not vote on or consent in writing to an amendment to the articles of incorporation has the right to dissent and to receive payment for such shares if the amendment:
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Alters or abolishes any preferential right of any outstanding shares having preference; or
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Creates, alters or abolishes any provision or right in respect to the redemption of any outstanding shares.
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Alters or abolishes any preemptive right of such holder to acquire shares or other securities; or
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Excludes or limits the right of such holder to vote on any matter, except as such right may be limited by the voting rights given to new shares then being authorized of any existing or new class.
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Shareholders’ Derivative Actions
 
An action may be brought in the right of a corporation to procure a judgment in its favor, by a holder of shares or of voting trust certificates or of a beneficial interest in such shares or certificates. It shall be made to appear that the plaintiff is such a holder at the time the action is brought and that he was such a holder at the time of the transaction of which he complains, or that his shares or his interest therein devolved upon him by operation of law.
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In any derivative suit instituted by a shareholder or a corporation, it shall be averred in the complaint that the plaintiff was a shareholder of the corporation at the time of the transaction of which he complains or that such shareholder’s stock thereafter devolved upon such shareholder by operation of law.
       
A complaint shall set forth with particularity the efforts of the plaintiff to secure the initiation of such action by the board of directors or the reasons for not making such effort. Such action shall not be discontinued, compromised or settled without the approval of the High Court of the Republic of The Marshall Islands.
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Reasonable expenses including attorneys’ fees may be awarded if the action is successful.
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A corporation may require a plaintiff bringing a derivative suit to give security for reasonable expenses if the plaintiff owns less than 5% of any class of stock and the common shares have a value of $50,000 or less.
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13
EX-4.3 3 ef20039046_ex4-3.htm EXHIBIT 4.3
Exhibit 4.3

AMENDED AND RESTATED

UNITED MARITIME CORPORATION
2022 EQUITY INCENTIVE PLAN

ADOPTED ON APRIL 7, 2025

ARTICLE I.
General

1.1.
Purpose

The United Maritime Corporation 2022 Equity Incentive Plan (the “Plan”) is designed to provide certain Key Persons (as defined below), whose initiative and efforts are deemed to be important to the successful conduct of the business of United Maritime Corporation (the “Company”), with incentives to (a) enter into and remain in the service of the Company or its Affiliates (as defined below), (b) acquire a proprietary interest in the success of the Company, (c) maximize their performance and (d) enhance the long-term performance of the Company.

1.2.
Administration

(a)          Administration.  The Plan shall be administered by the Compensation Committee of the Company’s Board of Directors (the “Board”) or such other committee of the Board as may be designated by the Board to administer the Plan (the “Administrator”); provided that (i) in the event the Company is subject to Section 16 of the U.S. Securities Exchange Act of 1934, as amended (the “1934 Act”), the Administrator shall be composed of two or more directors, each of whom is a “Non-Employee Director” (a “Non-Employee Director”) under Rule 16b-3 (as promulgated and interpreted by the Securities and Exchange Commission (the “SEC”) under the 1934 Act, or any successor rule or regulation thereto as in effect from time to time (“Rule 16b-3”)), and (ii) the Administrator shall be composed solely of two or more directors who are “independent directors” under the rules of any stock exchange on which the Company’s Common Stock (as defined below) is traded; provided further, however, that, (A) the requirement in the preceding clause (i) shall apply only when required to exempt an Award intended to qualify for an exemption under the applicable provisions referenced therein, (B) the requirement in the preceding clause (ii) shall apply only when required pursuant to the applicable rules of the applicable stock exchange and (C) if at any time the Administrator is not so composed as required by the preceding provisions of this sentence, that fact will not invalidate any grant made, or action taken, by the Administrator hereunder that otherwise satisfies the terms of the Plan.  Subject to the terms of the Plan and applicable law, and in addition to other express powers and authorizations conferred on the Administrator by the Plan, the Administrator shall have the full power and authority to: (1) designate the Persons (as defined below) to receive Awards (as defined below) under the Plan; (2) determine the types of Awards granted to a participant under the Plan; (3) determine the number of shares to be covered by, or with respect to which payments, rights or other matters are to be calculated with respect to, Awards; (4) determine the terms and conditions of any Awards; (5) determine whether, and to what extent, and under what circumstances, Awards may be settled or exercised in cash, shares, other securities, other Awards or other property, or cancelled, forfeited or suspended, and the methods by which Awards may be settled, exercised, cancelled, forfeited or suspended; (6) determine whether, to what extent, and under what circumstances cash, shares, other securities, other Awards, other property and other amounts payable with respect to an Award shall be deferred, either automatically or at the election of the holder thereof or the Administrator; (7) construe, interpret and implement the Plan and any Award Agreement (as defined below); (8) prescribe, amend, rescind or waive rules and regulations relating to the Plan, including rules governing its operation, and appoint such agents as it shall deem appropriate for the proper administration of the Plan; (9)  correct any defect, supply any omission and reconcile any inconsistency in the Plan or any Award Agreement; and (10) make any other determination and take any other action that the Administrator deems necessary or desirable for the administration of the Plan.  Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Award shall be within the sole discretion of the Administrator, may be made at any time and shall be final, conclusive and binding upon all Persons.


(b)          General Right of Delegation.  Except to the extent prohibited by applicable law, the applicable rules of a stock exchange or any charter, by-laws or other agreement governing the Administrator, the Administrator may delegate all or any part of its responsibilities to any Person or Persons selected by it; provided, however, that in no event shall an officer of the Company be delegated the authority to grant Awards to, or amend Awards held by, the following individuals: (i) individuals who are subject to Section 16 of the 1934 Act, or (ii) officers of the Company (or directors of the Company) to whom authority to grant or amend Awards has been delegated hereunder; provided, further, that any delegation of administrative authority shall only be permitted to the extent it is permissible under applicable securities laws (including, without limitation, Rule 16b-3, to the extent applicable) and the rules of any applicable stock exchange.  Any delegation hereunder shall be subject to the restrictions and limits that the Administrator specifies at the time of such delegation, and the Administrator may at any time rescind the authority so delegated or appoint a new delegate.  At all times, the delegates appointed under this Section 1.2(b) shall serve in such capacity at the pleasure of the Administrator.
 

(c)         Indemnification.  No member of the Board, the Administrator or any employee of the Company or an Affiliate (each such Person, a “Covered Person”) shall be liable for any action taken or omitted to be taken or any determination made in good faith with respect to the Plan or any Award hereunder.  Each Covered Person shall be indemnified and held harmless by the Company against and from (i) any loss, cost, liability or expense (including attorneys’ fees) that may be imposed upon or incurred by such Covered Person in connection with or resulting from any action, suit or proceeding to which such Covered Person may be a party or in which such Covered Person may be involved by reason of any action taken or omitted to be taken under the Plan or any Award Agreement and (ii) any and all amounts paid by such Covered Person, with the Company’s approval, in settlement thereof, or paid by such Covered Person in satisfaction of any judgment in any such action, suit or proceeding against such Covered Person; provided that the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding and, once the Company gives notice of its intent to assume the defense, the Company shall have sole control over such defense with counsel of the Company’s choice.  The foregoing right of indemnification shall not be available to a Covered Person to the extent that a court of competent jurisdiction in a final judgment or other final adjudication, in either case not subject to further appeal, determines that the acts or omissions of such Covered Person giving rise to the indemnification claim resulted from such Covered Person’s bad faith, fraud or willful criminal act or omission or that such right of indemnification is otherwise prohibited by law or by the Company’s articles of incorporation or by-laws (in each case, as amended and/or restated).  The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which Covered Persons may be entitled under the Company’s articles of incorporation or by-laws (in each case, as amended and/or restated), as a matter of law, or otherwise, or any other power that the Company may have to indemnify such Persons or hold them harmless.
 
(d)           Delegation of Authority to Senior Officers.  The Administrator may, in accordance with and subject to the terms of Section 1.2(b), delegate, on such terms and conditions as it determines, to one or more senior officers of the Company the authority to make grants of Awards to employees of the Company and its Subsidiaries (as defined below) (including any such prospective employee) and consultants of the Company and its Subsidiaries.
 
(e)          Award Grants.  Notwithstanding anything to the contrary contained herein, the Board may, in its sole discretion, at any time and from time to time, grant Awards to Non-Employee Directors or administer the Plan with respect to such Awards, in which event the Board shall have all the authority and responsibility granted to the Administrator herein with respect to such Awards.  In determining Awards to be granted under the Plan, the Administrator shall take into account such factors as it deem advisable, which may include taking into account the Company’s performance, the Award recipient’s performance, and/or the satisfaction of any performance goals or targets as may established from time to time.
 
1.3.
Persons Eligible for Awards
 
The Persons eligible to receive Awards under the Plan are those directors, officers and employees (including any prospective officer or employee) of the Company and its Subsidiaries and Affiliates and consultants and service providers (including individuals who are employed by or provide services to any entity that is itself such a consultant or service provider) to the Company and its Subsidiaries and Affiliates (collectively, “Key Persons”) as the Administrator shall select.
 

1.4.
Types of Awards
 
Awards may be made under the Plan in the form of (a) “incentive stock options” that are intended to qualify for special U.S. federal income tax treatment pursuant to Sections 421 and 422 of the Code (as defined below), as may be amended from time to time, or pursuant to a successor provision of the Code, and which is so designated in the applicable Award Agreement, (b) non-qualified stock options (i.e., any stock options granted under the Plan that are not “incentive stock options”), (c) stock appreciation rights, (d) restricted stock, (e) restricted stock units and (f) unrestricted stock, all as more fully set forth in the Plan.  The term “Award” means any of the foregoing that are granted under the Plan. No incentive stock option (other than an incentive stock option that may be assumed or issued by the Company in connection with a transaction to which Section 424(a) of the Code applies) may be granted under the Plan to a Person who is not eligible to receive an incentive stock option under the Code.
 
1.5.
Shares Available for Awards; Adjustments for Changes in Capitalization
 
(a)           Maximum Number.  Subject to adjustment as provided in Section 1.5(c), the aggregate number of shares of common stock of the Company, par value $0.0001 (“Common Stock”), with respect to which Awards may at any time be granted under the Plan shall be 400,000.  The following shares of Common Stock shall again become available for Awards under the Plan: (i) any shares that are subject to an Award under the Plan and that remain unissued upon the cancellation or termination of such Award for any reason whatsoever; (ii) any shares of restricted stock forfeited pursuant to the Plan or the applicable Award Agreement; provided that any dividend equivalent rights with respect to such shares that have not theretofore been directly remitted to the grantee are also forfeited; and (iii) any shares in respect of which an Award is settled for cash without the delivery of shares to the grantee.  Any shares tendered or withheld to satisfy the grant or exercise price or tax withholding obligation pursuant to any Award shall again become available to be delivered pursuant to Awards under the Plan.
 
(b)          Source of Shares.  Shares issued pursuant to the Plan may be authorized but unissued Common Stock or treasury shares.  The Administrator may direct that any stock certificate evidencing shares issued pursuant to the Plan shall bear a legend setting forth such restrictions on transferability as may apply to such shares.
 
(c)          Adjustments.  (i)  In the event that any dividend or other distribution (whether in the form of cash, Company shares, other securities or other property), stock split, reverse stock split, reorganization, merger, consolidation, split-up, combination, repurchase or exchange of Company shares or other securities of the Company, issuance of warrants or other rights to purchase Company shares or other securities of the Company, or other similar corporate transaction or event, other than an Equity Restructuring (as defined below), affects the Company shares such that an adjustment is determined by the Administrator to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an Award, then the Administrator shall, in such manner as it may deem equitable, adjust any or all of the number of shares or other securities of the Company (or number and kind of other securities or property) with respect to which Awards may be granted under the Plan, including the maximum number of shares issuable to an individual as set forth in Section 1.5(d).
 

(ii)          The Administrator is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (including the events described in Section 1.5(c)(i) or the occurrence of a Change in Control (as defined below), other than an Equity Restructuring) affecting the Company, any Affiliate, or the financial statements of the Company or any Affiliate, or of changes in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange, accounting principles or law, whenever the Administrator determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an Award, including providing for (A) adjustment to (1) the number of shares or other securities of the Company (or number and kind of other securities or property) subject to outstanding Awards or to which outstanding Awards relate and (2) the Exercise Price (as defined below) with respect to any Award and (B) a substitution or assumption of Awards, accelerating the exercisability or vesting of, or lapse of restrictions on, Awards, or accelerating the termination of Awards by providing for a period of time for exercise prior to the occurrence of such event, or, if deemed appropriate or desirable, providing for a cash payment to the holder of an outstanding Award in consideration for the cancellation of such Award (it being understood that, in such event, any option or stock appreciation right having a per share Exercise Price equal to, or in excess of, the Fair Market Value (as defined below) of a share subject to such option or stock appreciation right may be cancelled and terminated without any payment or consideration therefor); provided, however, that with respect to options and stock appreciation rights, unless otherwise determined by the Administrator, such adjustment shall be made in accordance with the provisions of Section 424(h) of the Code.
 
(iii)         In the event of (A) a dissolution or liquidation of the Company, (B) a sale of all or substantially all the Company’s assets or (C) a merger, reorganization or consolidation involving the Company or one of its Subsidiaries (as defined below), the Administrator shall have the power to:
 
(1)  provide that outstanding options, stock appreciation rights and/or restricted stock units (including any related dividend equivalent right) shall either continue in effect, be assumed or an equivalent award shall be substituted therefor by the successor corporation or a parent corporation or subsidiary corporation;
 

(2)  cancel, effective immediately prior to the occurrence of such event, options, stock appreciation rights and/or restricted stock units (including each dividend equivalent right related thereto) outstanding immediately prior to such event (whether or not then exercisable) and, in full consideration of such cancellation, pay to the holder of such Award a cash payment in an amount equal to the excess, if any, of the Fair Market Value (as of a date specified by the Administrator) of the shares subject to such Award over the aggregate Exercise Price of such Award (it being understood that, in such event, any option or stock appreciation right having a per share Exercise Price equal to, or in excess of, the Fair Market Value of a share subject to such option or stock appreciation right may be cancelled and terminated without any payment or consideration therefor); or
 
(3)  notify the holder of an option or stock appreciation right in writing or electronically that each option and stock appreciation right shall be fully vested and exercisable for a period of 30 days from the date of such notice, or such shorter period as the Administrator may determine to be reasonable, and the option or stock appreciation right shall terminate upon the expiration of such period (which period shall expire no later than immediately prior to the consummation of the corporate transaction).
 
(iv)        In connection with the occurrence of any Equity Restructuring, and notwithstanding anything to the contrary in this Section 1.5(c):
 
(A)         The number and type of securities or other property subject to each outstanding Award and the Exercise Price or grant price thereof, if applicable, shall be equitably adjusted; and
 
(B)        The Administrator shall make such equitable adjustments, if any, as the Administrator may deem appropriate to reflect such Equity Restructuring with respect to the aggregate number and kind of shares that may be issued under the Plan (including, but not limited to, adjustments of the limitations set forth in Sections 1.5(a) and 1.5(d)).  The adjustments provided under this Section 1.5(c)(iv) shall be nondiscretionary and shall be final and binding on the affected participant and the Company.
 
(d)           Individual Limit.  Except for the limits set forth in this Section 1.5, no provision of this Plan shall be deemed to limit the number or value of shares of Common Stock with respect to which the Administrator may make Awards to any Key Person.  Subject to adjustment as provided in Section 1.5(c), the total number of shares of Common Stock with respect to which incentive stock options may be granted under the Plan to any one employee of the Company or a “parent corporation” or “subsidiary corporation” (as such terms are defined in Section 424 of the Code) of the Company during any one calendar year shall not exceed 3,125,000.  Incentive stock options granted and subsequently cancelled or deemed to be cancelled (e.g., as a result of re-pricing) in a calendar year count against the limit in the preceding sentence even after their cancellation.
 

1.6.
Definitions of Certain Terms
 
(a)           “Affiliate” shall mean (i) any entity that, directly or indirectly, is controlled by, controls or is under common control with, the Company and (ii) any entity in which the Company has a significant equity interest, in either case as determined by the Administrator.
 
(b)         Unless otherwise set forth in the applicable Award Agreement, in connection with a termination of employment or consultancy/service relationship or a dismissal from Board membership, for purposes of the Plan, the term “for Cause” shall be defined as follows:
 
(i)         if there is an employment, severance, consulting, service, change in control or other agreement governing the relationship between the grantee, on the one hand, and the Company or an Affiliate, on the other hand, that contains a definition of “cause” (or similar phrase), for purposes of the Plan, the term “for Cause” shall mean those acts or omissions that would constitute “cause” under such agreement; or
 
(ii)       if the preceding clause (i) is not applicable to the grantee, for purposes of the Plan, the term “for Cause” shall mean any of the following:
 
(A)         any failure by the grantee substantially to perform the grantee’s employment or consulting/service or Board membership duties;
 
(B)         any excessive unauthorized absenteeism by the grantee;
 
(C)         any refusal by the grantee to obey the lawful orders of the Board or any other Person to whom the grantee reports;
 
(D)         any act or omission by the grantee that is or may be injurious to the Company or any Affiliate, whether monetarily, reputationally or otherwise;
 
(E)         any act by the grantee that is inconsistent with the best interests of the Company or any Affiliate;
 
(F)         the grantee’s gross negligence that is injurious to the Company or any Affiliate, whether monetarily, reputationally or otherwise;
 
(G)         the grantee’s material violation of any of the policies of the Company or an Affiliate, as applicable, including, without limitation, those policies relating to discrimination or sexual harassment;
 
(H)         the grantee’s material breach of his or her employment or service contract with the Company or any Affiliate;


(I)          the grantee’s unauthorized (1) removal from the premises of the Company or an Affiliate of any document (in any medium or form) relating to the Company or an Affiliate or the customers or clients of the Company or an Affiliate or (2) disclosure to any Person of any of the Company’s, or any Affiliate’s, confidential or proprietary information;
 
(J)          the grantee’s being convicted of, or entering a plea of guilty or nolo contendere to, any crime that constitutes a felony or involves moral turpitude; and
 
(K)         the grantee’s commission of any act involving dishonesty or fraud.
 
Any rights the Company or its Affiliates may have under the Plan in respect of the events giving rise to a termination or dismissal “for Cause” shall be in addition to any other rights the Company or its Affiliates may have under any other agreement with a grantee or at law or in equity.  Any determination of whether a grantee’s employment, consultancy/service relationship or Board membership is (or is deemed to have been) terminated “for Cause” shall be made by the Administrator.  If, subsequent to a grantee’s voluntary termination of employment or consultancy/service relationship or voluntarily resignation from the Board or involuntary termination of employment or consultancy/service relationship without Cause or removal from the Board other than “for Cause”, it is discovered that the grantee’s employment or consultancy/service relationship or Board membership could have been terminated “for Cause”, the Administrator may deem such grantee’s employment or consultancy/service relationship or Board membership to have been terminated “for Cause” upon such discovery and determination by the Administrator.
 
(c)          “Code” shall mean the Internal Revenue Code of 1986, as amended.
 
(d)          Unless otherwise set forth in the applicable Award Agreement, “Disability” shall mean the grantee’s being unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or the grantee’s, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the grantee’s employer.  The existence of a Disability shall be determined by the Administrator.
 
(e)         “Equity Restructuring” shall mean a non-reciprocal transaction between the Company and its stockholders, such as a stock dividend, stock split, spin-off, rights offering or recapitalization through a large, nonrecurring cash dividend, that affects the shares of Common Stock (or other securities of the Company) or the share price thereof and causes a change in the per share value of the shares underlying outstanding Awards.
 

(f)          “Exercise Price” shall mean (i) in the case of options, the price specified in the applicable Award Agreement as the price-per-share at which such share can be purchased pursuant to the option or (ii) in the case of stock appreciation rights, the price specified in the applicable Award Agreement as the reference price-per-share used to calculate the amount payable to the grantee.
 
(g)         The “Fair Market Value” of a share of Common Stock on any day shall be the closing price on the Nasdaq Global Market, or such other primary stock exchange upon which such shares are then listed, as reported for such day in The Wall Street Journal, or, if no such price is reported for such day, the average of the high bid and low asked price of Common Stock as reported for such day.  If no quotation is made for the applicable day, the Fair Market Value of a share of Common Stock on such day shall be determined in the manner set forth in the preceding sentence for the next preceding trading day.  Notwithstanding the foregoing, if there is no reported closing price or high bid/low asked price that satisfies the preceding sentences, or if otherwise deemed necessary or appropriate by the Administrator, the Fair Market Value of a share of Common Stock on any day shall be determined by such methods and procedures as shall be established from time to time by the Administrator.  The “Fair Market Value” of any property other than Common Stock shall be the fair market value of such property determined by such methods and procedures as shall be established from time to time by the Administrator.
 
(h)         “Person” shall mean any individual, firm, corporation, partnership, limited liability company, trust, incorporated or unincorporated association, joint venture, joint stock company, governmental body or other entity of any kind.
 
(i)          “Repricing” shall mean (i) lowering the Exercise Price of an option or a stock appreciation right after it has been granted, (ii) the cancellation of an option or a stock appreciation right in exchange for cash or another Award when the Exercise Price exceeds the Fair Market Value of the underlying shares subject to the Award and (iii) any other action with respect to an option or a stock appreciation right that is treated as a repricing under (A) generally accepted accounting principles or (B) any applicable stock exchange rules.
 
(j)          Unless otherwise set forth in the applicable Award Agreement, “Retirement” shall mean a grantee’s resignation of employment or consultancy/service relationship or dismissal from the Board, with the Company’s or its applicable Affiliate’s prior consent, on or after (i) his or her 65th birthday, (ii) the date on which he or she has attained age 60 and completed at least five years of service with the Company or one or more of its Affiliates (using any method of calculation the Administrator deems appropriate) or (iii) if approved by the Administrator, on or after his or her having completed at least 20 years of service with the Company or one or more of its Affiliates (using any method of calculation the Administrator deems appropriate).
 

(k)            “Subsidiary” shall mean any entity in which the Company, directly or indirectly, has a 50% or more equity interest.
 
ARTICLE II.
 
Awards Under the Plan
 
2.1.
Agreements Evidencing Awards
 
 Each Award granted under the Plan shall be evidenced by a written certificate (“Award Agreement”), which shall contain such provisions as the Administrator may deem necessary or desirable and which may, but need not, require execution or acknowledgment by a grantee.  The Award shall be subject to all of the terms and provisions of the Plan and the applicable Award Agreement.
 
2.2.
Grant of Stock Options and Stock Appreciation Rights
 
(a)          Stock Option Grants.  The Administrator may grant non-qualified stock options and/or incentive stock options (collectively, “options”) to purchase shares of Common Stock from the Company to such Key Persons, and in such amounts and subject to such vesting and forfeiture provisions and other terms and conditions, as the Administrator shall determine, subject to the provisions of the Plan.  Except to the extent otherwise specifically provided in the applicable Award Agreement, no option will be treated as an “incentive stock option” for purposes of the Code.  Incentive stock options may be granted to employees of the Company and any “parent corporation” or “subsidiary corporation” (as such terms are defined in Section 424 of the Code) of the Company.  In the case of incentive stock options, the terms and conditions of such Awards shall be subject to such applicable rules as may be prescribed by Sections 421, 422 and 424 of the Code and any regulations related thereto, as may be amended from time to time.  If an option is intended to be an incentive stock option, and if for any reason such option (or any portion thereof) shall not qualify as an incentive stock option for purposes of Section 422 of the Code, then, to the extent of such non-qualification, such option (or portion thereof) shall be regarded as a non-qualified stock option appropriately granted under the Plan; provided that such option (or portion thereof) otherwise complies with the Plan’s requirements relating to option Awards.  It shall be the intent of the Administrator to not grant an Award in the form of stock options to any Key Person who is then subject to the requirements of Section 409A of the Code with respect to such Award if the Common Stock (as defined below) underlying such Award does not then qualify as “service recipient stock” for purposes of Section 409A.  Furthermore, it shall be the intent of the Administrator, in granting options to Key Persons who are subject to Section 409A and/or 457 of the Code, to structure such options so as to comply with the requirements of Section 409A and/or 457 of the Code, as applicable.
 

(b)           Stock Appreciation Right Grants; Types of Stock Appreciation Rights.  The Administrator may grant stock appreciation rights to such Key Persons, and in such amounts and subject to such vesting and forfeiture provisions and other terms and conditions, as the Administrator shall determine, subject to the provisions of the Plan.  The terms of a stock appreciation right may provide that it shall be automatically exercised for a payment upon the happening of a specified event that is outside the control of the grantee and that it shall not be otherwise exercisable.  Stock appreciation rights may be granted in connection with all or any part of, or independently of, any option granted under the Plan.  It shall be the intent of the Administrator to not grant an Award in the form of stock appreciation rights to any Key Person (i) who is then subject to the requirements of Section 409A of the Code with respect to such Award if the Common Stock underlying such Award does not then qualify as “service recipient stock” for purposes of Section 409A or (ii) if such Award would create adverse tax consequences for such Key Person under Section 457A of the Code.
 
(c)           Nature of Stock Appreciation Rights.  The grantee of a stock appreciation right shall have the right, subject to the terms of the Plan and the applicable Award Agreement, to receive from the Company an amount equal to (i) the excess of the Fair Market Value of a share of Common Stock on the date of exercise of the stock appreciation right over the Exercise Price of the stock appreciation right, multiplied by (ii) the number of shares with respect to which the stock appreciation right is exercised.  Each Award Agreement with respect to a stock appreciation right shall set forth the Exercise Price of such Award and, unless otherwise specifically provided in the Award Agreement, the Exercise Price of a stock appreciation right shall equal the Fair Market Value of a share of Common Stock on the date of grant; provided that in no event may such Exercise Price be less than the greater of (A) the Fair Market Value of a share of Common Stock on the date of grant and (B) the par value of a share of Common Stock.  Payment upon exercise of a stock appreciation right shall be in cash or in shares of Common Stock (valued at their Fair Market Value on the date of exercise of the stock appreciation right) or any combination of both, all as the Administrator shall determine.  Repricing of stock appreciation rights granted under the Plan shall not be permitted (1) to the extent such action could cause adverse tax consequences to the grantee under Sections 409A or 457A of the Code or (2) without prior shareholder approval, to the extent such approval would be required to be obtained by the Company pursuant to the applicable rules of any applicable stock exchange on which the Common Stock is then listed, and any action that would be deemed to result in a Repricing of a stock appreciation right shall be deemed null and void if it would cause such adverse tax consequences or if any requisite shareholder approval related thereto is not obtained prior to the effective time of such action.  Upon the exercise of a stock appreciation right granted in connection with an option, the number of shares subject to the option shall be reduced by the number of shares with respect to which the stock appreciation right is exercised.  Upon the exercise of an option in connection with which a stock appreciation right has been granted, the number of shares subject to the stock appreciation right shall be reduced by the number of shares with respect to which the option is exercised.
 

(d)          Option Exercise Price.  Each Award Agreement with respect to an option shall set forth the Exercise Price of such Award and, unless otherwise specifically provided in the Award Agreement, the Exercise Price of an option shall equal the Fair Market Value of a share of Common Stock on the date of grant; provided that in no event may such Exercise Price be less than the greater of (i) the Fair Market Value of a share of Common Stock on the date of grant and (ii) the par value of a share of Common Stock.  Repricing of options granted under the Plan shall not be permitted (1) to the extent such action could cause adverse tax consequences to the grantee under Sections 409A or 457A of the Code or (2) without prior shareholder approval, to the extent such approval would be required to be obtained by the Company pursuant to the applicable rules of any applicable stock exchange on which the Common Stock is then listed, and any action that would be deemed to result in a Repricing of an option shall be deemed null and void if it would cause such adverse tax consequences or if any requisite shareholder approval related thereto is not obtained prior to the effective time of such action.
 
2.3.
Exercise of Options and Stock Appreciation Rights
 
Subject to the other provisions of this Article II and the Plan, each option and stock appreciation right granted under the Plan shall be exercisable as follows:
 
(a)        Timing and Extent of Exercise.  Options and stock appreciation rights shall be exercisable at such times and under such conditions as determined by the Administrator and set forth in the corresponding Award Agreement, but in no event shall any portion of such Award be exercisable subsequent to the tenth anniversary of the date on which such Award was granted.  Unless the applicable Award Agreement otherwise provides, an option or stock appreciation right may be exercised from time to time as to all or part of the shares as to which such Award is then exercisable.
 
(b)          Notice of Exercise.  An option or stock appreciation right shall be exercised by the filing of a written notice with the Company or the Company’s designated exchange agent (the “Exchange Agent”), on such form and in such manner as the Administrator shall prescribe.
 
(c)         Payment of Exercise Price.  Any written notice of exercise of an option shall be accompanied by payment for the shares being purchased.  Such payment shall be made: (i) by certified or official bank check (or the equivalent thereof acceptable to the Company or its Exchange Agent) for the full option Exercise Price; (ii) with the consent of the Administrator, which consent shall be given or withheld in the sole discretion of the Administrator, by delivery of shares of Common Stock having a Fair Market Value (determined as of the exercise date) equal to all or part of the option Exercise Price and a certified or official bank check (or the equivalent thereof acceptable to the Company or its Exchange Agent) for any remaining portion of the full option Exercise Price; or (iii) at the sole discretion of the Administrator and to the extent permitted by law, by such other provision, consistent with the terms of the Plan, as the Administrator may from time to time prescribe (whether directly or indirectly through the Exchange Agent), or by any combination of the foregoing payment methods.
 

(d)         Delivery of Certificates Upon Exercise.  Subject to Sections 3.2, 3.4 and 3.13, promptly after receiving payment of the full option Exercise Price, or after receiving notice of the exercise of a stock appreciation right for which the Administrator determines payment will be made partly or entirely in shares, the Company or its Exchange Agent shall (i) deliver to the grantee, or to such other Person as may then have the right to exercise the Award, a certificate or certificates for the shares of Common Stock for which the Award has been exercised or, in the case of stock appreciation rights, for which the Administrator determines will be made in shares or (ii) establish an account evidencing ownership of the stock in uncertificated form.  If the method of payment employed upon an option exercise so requires, and if applicable law permits, an optionee may direct the Company or its Exchange Agent, as the case may be, to deliver the stock certificate(s) to the optionee’s stockbroker.
 
(e)         No Stockholder Rights.  No grantee of an option or stock appreciation right (or other Person having the right to exercise such Award) shall have any of the rights of a stockholder of the Company with respect to shares subject to such Award until the issuance of a stock certificate to such Person for such shares.  Except as otherwise provided in Section 1.5(c), no adjustment shall be made for dividends, distributions or other rights (whether ordinary or extraordinary, and whether in cash, securities or other property) for which the record date is prior to the date such stock certificate is issued.
 
2.4.
Termination of Employment; Death Subsequent to a Termination of Employment
 
(a)          General Rule.  Except to the extent otherwise provided in paragraphs (b), (c), (d), (e) or (f) of this Section 2.4 or Section 3.5(b)(iii), a grantee who incurs a termination of employment or consultancy/service relationship or dismissal from the Board may exercise any outstanding option or stock appreciation right on the following terms and conditions: (i) exercise may be made only to the extent that the grantee was entitled to exercise the Award on the date of termination of employment or consultancy/service relationship or dismissal from the Board, as applicable; and (ii) exercise must occur within three months after termination of employment or consultancy/service relationship or dismissal from the Board but in no event after the original expiration date of the Award.
 

(b)         Dismissal “for Cause”.  If a grantee incurs a termination of employment or consultancy/service relationship or dismissal from the Board “for Cause”, all options and stock appreciation rights not theretofore exercised shall immediately terminate upon the grantee’s termination of employment or consultancy/service relationship or dismissal from the Board.
 
(c)          Retirement.  If a grantee incurs a termination of employment or consultancy/service relationship or dismissal from the Board as the result of his or her Retirement, then any outstanding option or stock appreciation right shall, to the extent exercisable at the time of such Retirement, remain exercisable for a period of three years after such Retirement; provided that in no event may such option or stock appreciation right be exercised following the original expiration date of the Award.
 
(d)          Disability.  If a grantee incurs a termination of employment or consultancy/service relationship or a dismissal from the Board by reason of a Disability, then any outstanding option or stock appreciation right shall, to the extent exercisable at the time of such termination or dismissal, remain exercisable for a period of one year after such termination or dismissal; provided that in no event may such option or stock appreciation right be exercised following the original expiration date of the Award.
 
(e)          Death.
 
(i)        Termination of Employment as a Result of Grantee’s Death.  If a grantee incurs a termination of employment or consultancy/service relationship or leaves the Board as the result of his or her death, then any outstanding option or stock appreciation right shall, to the extent exercisable at the time of such death, remain exercisable for a period of one year after such death; provided that in no event may such option or stock appreciation right be exercised following the original expiration date of the Award.
 
   (ii)      Restrictions on Exercise Following Death.  Any such exercise of an Award following a grantee’s death shall be made only by the grantee’s executor or administrator or other duly appointed representative reasonably acceptable to the Administrator, unless the grantee’s will specifically disposes of such Award, in which case such exercise shall be made only by the recipient of such specific disposition.  If a grantee’s personal representative or the recipient of a specific disposition under the grantee’s will shall be entitled to exercise any Award pursuant to the preceding sentence, such representative or recipient shall be bound by all the terms and conditions of the Plan and the applicable Award Agreement which would have applied to the grantee.
 
(f)           Administrator Discretion.  The Administrator may, in writing, waive or modify the application of the foregoing provisions of this Section 2.4.
 

2.5.
Transferability of Options and Stock Appreciation Rights
 
Except as otherwise specifically provided in this Plan or the applicable Award Agreement evidencing an option or stock appreciation right, during the lifetime of a grantee, each such Award granted to a grantee shall be exercisable only by the grantee, and no such Award may be sold, assigned, transferred, pledged or otherwise encumbered or disposed of other than by will or by the laws of descent and distribution.  The Administrator may, in any applicable Award Agreement evidencing an option or stock appreciation right, permit a grantee to transfer all or some of the options or stock appreciation rights to (a) the grantee’s spouse, children or grandchildren (“Immediate Family Members”), (b) a trust or trusts for the exclusive benefit of such Immediate Family Members or (c) other parties approved by the Administrator.  Following any such transfer, any transferred options and stock appreciation rights shall continue to be subject to the same terms and conditions as were applicable immediately prior to the transfer.
 
2.6.
Grant of Restricted Stock

(a)          Restricted Stock Grants.  The Administrator may grant restricted shares of Common Stock to such Key Persons, in such amounts and subject to such vesting and forfeiture provisions and other terms and conditions as the Administrator shall determine, subject to the provisions of the Plan.  A grantee of a restricted stock Award shall have no rights with respect to such Award unless such grantee accepts the Award within such period as the Administrator shall specify by accepting delivery of a restricted stock Award Agreement in such form as the Administrator shall determine and, in the event the restricted shares are newly issued by the Company, makes payment to the Company or its Exchange Agent by certified or official bank check (or the equivalent thereof acceptable to the Administrator) in an amount at least equal to the par value of the shares covered by the Award (which payment may be waived at the time of grant of the restricted stock Award to the extent the restricted shares granted hereunder are otherwise deemed to be fully paid and non-assessable).
 
(b)         Issuance of Stock Certificate.  Promptly after a grantee accepts a restricted stock Award in accordance with Section 2.6(a), subject to Sections 3.2, 3.4 and 3.13, the Company or its Exchange Agent shall issue to the grantee a stock certificate or stock certificates for the shares of Common Stock covered by the Award or shall establish an account evidencing ownership of the stock in uncertificated form.  Upon the issuance of such stock certificates, or establishment of such account, the grantee shall have the rights of a stockholder with respect to the restricted stock, subject to: (i) the non-transferability restrictions and forfeiture provisions described in the Plan (including paragraphs (d) and (e) of this Section 2.6); (ii) in the Administrator’s sole discretion, a requirement, as set forth in the Award Agreement, that any dividends paid on such shares shall be held in escrow and, unless otherwise determined by the Administrator, shall remain forfeitable until all restrictions on such shares have lapsed; and (iii) any other restrictions and conditions contained in the applicable Award Agreement.
 

(c)         Custody of Stock Certificate.  Unless the Administrator shall otherwise determine, any stock certificates issued evidencing shares of restricted stock shall remain in the possession of the Company until such shares are free of any restrictions specified in the applicable Award Agreement.  The Administrator may direct that such stock certificates bear a legend setting forth the applicable restrictions on transferability.
 
(d)         Non-transferability.  Except as otherwise specifically provided in this Plan or the applicable Award Agreement evidencing a restricted stock Award, shares of restricted stock granted under the Plan may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of prior to the lapsing of all restrictions thereon.  The Administrator at the time of grant shall specify the date or dates (which may depend upon or be related to the attainment of performance goals and other conditions) on which the non-transferability of the restricted stock shall lapse.  The Administrator may, in any applicable Award Agreement evidencing a restricted stock Award, permit a grantee to transfer all or some of the shares of restricted stock prior to the lapsing of all restrictions thereon to (i) the grantee’s Immediate Family Members, (ii) a trust or trusts for the exclusive benefit of such Immediate Family Members or (iii) other parties approved by the Administrator.  Following any permitted transfer prior to the lapsing of all restrictions on the restricted stock, any transferred shares of restricted stock shall continue to be subject to the same terms and conditions as were applicable immediately prior to the transfer.
 
(e)          Consequence of Termination of Employment.  Unless otherwise set forth in the applicable Award Agreement, (i) a grantee’s termination of employment or consultancy/service relationship or dismissal from the Board for any reason other than death, Disability or Retirement shall cause the immediate forfeiture of all shares of restricted stock that have not yet vested as of the date of such termination of employment or consultancy/service relationship or dismissal from the Board and (ii) if a grantee incurs a termination of employment or consultancy/service relationship or dismissal from the Board as the result of his or her death, Disability or Retirement, all shares of restricted stock that have not yet vested as of the date of such termination or departure from the Board shall immediately vest as of such date.  Unless otherwise determined by the Administrator, all dividends paid on shares forfeited under this Section 2.6(e) that have not theretofore been directly remitted to the grantee shall also be forfeited, whether by termination of any escrow arrangement under which such dividends are held or otherwise.  The Administrator may, in writing, waive or modify the application of the foregoing provisions of this Section 2.6(e).
 

2.7.
Grant of Restricted Stock Units
 
(a)          Restricted Stock Unit Grants.  The Administrator may grant restricted stock units to such Key Persons, and in such amounts and subject to such vesting and forfeiture provisions and other terms and conditions, as the Administrator shall determine, subject to the provisions of the Plan.  A restricted stock unit granted under the Plan shall confer upon the grantee a right to receive from the Company, conditioned upon the occurrence of such vesting event as shall be determined by the Administrator and specified in the Award Agreement, the number of such grantee’s restricted stock units that vest upon the occurrence of such vesting event multiplied by the Fair Market Value of a share of Common Stock on the date of vesting.  Payment upon vesting of a restricted stock unit shall be in cash or in shares of Common Stock (valued at their Fair Market Value on the date of vesting) or both, all as the Administrator shall determine, and such payments shall be made to the grantee at such time as provided in the Award Agreement, which the Administrator shall intend to be (i) if Section 409A of the Code is applicable to the grantee, within the period required by Section 409A such that it qualifies as a “short-term deferral” pursuant to Section 409A and the Treasury Regulations issued thereunder, unless the Administrator shall provide for deferral of the Award intended to comply with Section 409A, (ii) if Section 457A of the Code is applicable to the grantee, within the period required by Section 457A(d)(3)(B) such that it qualifies for the exemption thereunder, or (iii) if Sections 409A and 457A of the Code are not applicable to the grantee, at such time as determined by the Administrator.
 
(b)          Dividend Equivalents.  The Administrator may include in any Award Agreement with respect to a restricted stock unit a dividend equivalent right entitling the grantee to receive amounts equal to the ordinary dividends that would be paid, during the time such Award is outstanding and unvested, on the shares of Common Stock underlying such Award if such shares were then outstanding.  In the event such a provision is included in a Award Agreement, the Administrator shall determine whether such payments shall be (i) paid to the holder of the Award, as specified in the Award Agreement, either (A) at the same time as the underlying dividends are paid, regardless of the fact that the restricted stock unit has not theretofore vested, or (B) at the time at which the Award’s vesting event occurs, conditioned upon the occurrence of the vesting event, (ii) made in cash, shares of Common Stock or other property and (iii) subject to such other vesting and forfeiture provisions and other terms and conditions as the Administrator shall deem appropriate and as shall be set forth in the Award Agreement.
 
(c)          Consequence of Termination of Employment.  Unless otherwise set forth in the applicable Award Agreement, (i) a grantee’s termination of employment or consultancy/service relationship or dismissal from the Board for any reason other than death, Disability or Retirement shall cause the immediate forfeiture of all restricted stock units that have not yet vested as of the date of such termination of employment or consultancy/service relationship or dismissal from the Board and (ii) if a grantee incurs a termination of employment or consultancy/service relationship or dismissal from the Board as the result of his or her death, Disability or Retirement, all restricted stock units that have not yet vested as of the date of such termination or departure from the Board shall immediately vest as of such date.  Unless otherwise determined by the Administrator, any dividend equivalent rights on any restricted stock units forfeited under this Section 2.7(c) that have not theretofore been directly remitted to the grantee shall also be forfeited, whether by termination of any escrow arrangement under which such dividends are held or otherwise.  The Administrator may, in writing, waive or modify the application of the foregoing provisions of this Section 2.7(c).
 

(d)         No Stockholder Rights.  No grantee of a restricted stock unit shall have any of the rights of a stockholder of the Company with respect to such Award unless and until a stock certificate is issued with respect to such Award upon the vesting of such Award (it being understood that the Administrator shall determine whether to pay any vested restricted stock unit in the form of cash or Company shares or both), which issuance shall be subject to Sections 3.2, 3.4 and 3.13.  Except as otherwise provided in Section 1.5(c), no adjustment to any restricted stock unit shall be made for dividends, distributions or other rights (whether ordinary or extraordinary, and whether in cash, securities or other property) for which the record date is prior to the date such stock certificate, if any, is issued.
 
(e)        Transferability of Restricted Stock Units.  Except as otherwise provided in an applicable Award Agreement evidencing a restricted stock unit, no restricted stock unit granted under the Plan shall be assignable or transferable.  The Administrator may, in any applicable Award Agreement evidencing a restricted stock unit, permit a grantee to transfer all or some of the restricted stock units to (i) the grantee’s Immediate Family Members, (ii) a trust or trusts for the exclusive benefit of such Immediate Family Members or (iii) other parties approved by the Administrator.  Following any such transfer, any transferred restricted stock units shall continue to be subject to the same terms and conditions as were applicable immediately prior to the transfer.
 
2.8.
Grant of Unrestricted Stock
 
The Administrator may grant (or sell at a purchase price at least equal to par value) shares of Common Stock free of restrictions under the Plan to such Key Persons and in such amounts and subject to such forfeiture provisions as the Administrator shall determine.  Shares may be thus granted or sold in respect of past services or other valid consideration.
 
ARTICLE III.
 
Miscellaneous
 
3.1.
Amendment of the Plan; Modification of Awards
 
(a)         Amendment of the Plan.  The Board may from time to time suspend, discontinue, revise or amend the Plan in any respect whatsoever, except that no such amendment shall materially impair any rights or materially increase any obligations under any Award theretofore made under the Plan without the consent of the grantee (or, upon the grantee’s death, the Person having the right to exercise the Award).  For purposes of this Section 3.1, any action of the Board or the Administrator that in any way alters or affects the tax treatment of any Award shall not be considered to materially impair any rights of any grantee.
 

(b)          Stockholder Approval Requirement.  If (1) required by applicable rules or regulations of a national securities exchange or the SEC, the Company shall obtain stockholder approval with respect to any amendment to the Plan that (i) expands the types of Awards available under the Plan, (ii) materially increases the aggregate number of shares which may be issued under the Plan, except as permitted pursuant to Section 1.5(c), (iii) materially increases the benefits to participants under the Plan, including any material change to (A) permit, or that has the effect of, a Repricing of any outstanding Award, (B) reduce the price at which shares or options to purchase shares may be offered or (C) extend the duration of the Plan, or (iv) materially expands the class of Persons eligible to receive Awards under the Plan, or (2) the Administrator determines that it desires to retain the ability to grant incentive stock options under the Plan thereafter, the Company shall obtain stockholder approval with respect to any amendment to the Plan that (i) increases the number of shares that may be issued under the Plan or the individual limit set forth under Section 1.5(d) of the Plan (except, in each case, as permitted pursuant to Section 1.5(c)) or (ii) expands the class of Persons eligible to receive incentive stock options under the Plan.
 
(c)          Modification of Awards.  The Administrator may cancel any Award under the Plan.  The Administrator also may amend any outstanding Award Agreement, including, without limitation, by amendment which would: (i) accelerate the time or times at which the Award becomes unrestricted, vested or may be exercised; (ii) waive or amend any goals, restrictions or conditions set forth in the Award Agreement; or (iii) waive or amend the operation of Sections 2.4, 2.6(e) or 2.7(c) with respect to the termination of the Award upon termination of employment or consultancy/service relationship or dismissal from the Board; provided, however, that no such amendment shall be made without shareholder approval if such approval is necessary to comply with any tax or regulatory requirement applicable to the Award.  However, any such cancellation or amendment (other than an amendment pursuant to Section 1.5, 3.5 or 3.16) that materially impairs the rights or materially increases the obligations of a grantee under an outstanding Award shall be made only with the consent of the grantee (or, upon the grantee’s death, the Person having the right to exercise the Award).  In making any modification to an Award (e.g., an amendment resulting in a direct or indirect reduction in the Exercise Price or a waiver or modification under Section 2.4(f), 2.6(e) or 2.7(c)), the Administrator may consider the implications, if any, of such modification under the Code with respect to incentive stock options granted under the Plan and/or Sections 409A and 457A of the Code with respect to Awards granted under the Plan to individuals subject to such provisions of the Code.
 
3.2.
Consent Requirement
 
(a)         No Plan Action Without Required Consent.  If the Administrator shall at any time determine that any Consent (as defined below) is necessary or desirable as a condition of, or in connection with, the granting of any Award under the Plan, the issuance or purchase of shares or other rights thereunder, or the taking of any other action thereunder (each such action being hereinafter referred to as a “Plan Action”), then such Plan Action shall not be taken, in whole or in part, unless and until such Consent shall have been effected or obtained to the full satisfaction of the Administrator.
 

(b)         Consent Defined.  The term “Consent” as used herein with respect to any Plan Action means (i) any and all listings, registrations or qualifications in respect thereof upon any securities exchange or under any federal, state or local law, rule or regulation, (ii) any and all written agreements and representations by the grantee with respect to the disposition of shares, or with respect to any other matter, which the Administrator shall deem necessary or desirable to comply with the terms of any such listing, registration or qualification or to obtain an exemption from the requirement that any such listing, qualification or registration be made and (iii) any and all consents, clearances and approvals in respect of a Plan Action by any governmental or other regulatory bodies.
 
3.3.
Non-assignability
 
Except as provided in Sections 2.4(e), 2.5, 2.6(d) or 2.7(e), (a) no Award or right granted to any Person under the Plan or under any Award Agreement shall be assignable or transferable other than by will or by the laws of descent and distribution and (b) all rights granted under the Plan or any Award Agreement shall be exercisable during the life of the grantee only by the grantee or the grantee’s legal representative or the grantee’s permissible successors or assigns (as authorized and determined by the Administrator).  All terms and conditions of the Plan and the applicable Award Agreements will be binding upon any permitted successors or assigns.
 
3.4.
Taxes
 
(a)          Withholding.  A grantee or other Award holder under the Plan shall be required to pay, in cash, to the Company, and the Company and its Affiliates shall have the right and are hereby authorized to withhold from any Award, from any payment due or transfer made under any Award or under the Plan or from any compensation or other amount owing to such grantee or other Award holder, the amount of any applicable withholding taxes in respect of an Award, its grant, its exercise, its vesting, or any payment or transfer under an Award or under the Plan, and to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for payment of such taxes.  Whenever shares of Common Stock are to be delivered pursuant to an Award under the Plan, with the approval of the Administrator, which the Administrator shall have sole discretion whether or not to give, the grantee may satisfy the foregoing condition by electing to have the Company withhold from delivery shares having a value equal to the amount of minimum tax required to be withheld.  Such shares shall be valued at their Fair Market Value as of the date on which the amount of tax to be withheld is determined.  Fractional share amounts shall be settled in cash.  Such a withholding election may be made with respect to all or any portion of the shares to be delivered pursuant to an Award as may be approved by the Administrator in its sole discretion.
 

(b)         Liability for Taxes.  Grantees and holders of Awards are solely responsible and liable for the satisfaction of all taxes and penalties that may arise in connection with Awards (including, without limitation, any taxes arising under Sections 409A and 457A of the Code) and the Company shall not have any obligation to indemnify or otherwise hold any such Person harmless from any or all of such taxes.  The Administrator shall have the discretion to organize any deferral program, to require deferral election forms, and to grant or, notwithstanding anything to the contrary in the Plan or any Award Agreement, to unilaterally modify any Award in a manner that (i) conforms with the requirements of Sections 409A and 457A of the Code (to the extent applicable), (ii) voids any participant election to the extent it would violate Sections 409A or 457A of the Code (to the extent applicable) and (iii) for any distribution event or election that could be expected to violate Section 409A of the Code, make the distribution only upon the earliest of the first to occur of a “permissible distribution event” within the meaning of Section 409A of the Code or a distribution event that the participant elects in accordance with Section 409A of the Code.  The Administrator shall have the sole discretion to interpret the requirements of the Code, including, without limitation, Sections 409A and 457A, for purposes of the Plan and all Awards.
 
3.5.
Change in Control
 
(a)          Change in Control Defined.  Unless otherwise set forth in the applicable Award Agreement, for purposes of the Plan, “Change in Control” shall mean the occurrence of any of the following:
 
(i)         any “person” (as defined in Section 13(d)(3) of the 1934 Act), company or other entity (other than (A) the Company, (B) any trustee or other fiduciary holding securities under an employee benefit plan of the Company or an Affiliate or (C) any company or other entity owned, directly or indirectly, by the holders of the voting stock of the Company in substantially the same proportions as their ownership of the aggregate voting power of the capital stock ordinarily entitled to elect directors of the Company directly or indirectly “controls” (as defined in Rule 12b-2 under the 1934 Act)) acquires “beneficial ownership” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of more than 50% of the aggregate voting power of the capital stock ordinarily entitled to elect directors of the Company;
 
(ii)        the sale of all or substantially all the Company’s assets in one or more related transactions to any “person” (as defined in Section 13(d)(3) of the 1934 Act), company or other entity, other than such a sale (A) to a Subsidiary which does not involve a material change in the equity holdings of the Company, (B) to an entity which has acquired all or substantially all the Company’s assets (any such entity described in clause (A) or (B), the “Acquiring Entity”) if, immediately following such sale, 50% or more of the aggregate voting power of the capital stock ordinarily entitled to elect directors of the Acquiring Entity (or, if applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of more than 50% of the aggregate voting power of the capital stock ordinarily entitled to elect directors of the Acquiring Entity) is beneficially owned by the holders of the voting stock of the Company, and such voting power among the persons who were holders of the voting stock of the Company immediately prior to such sale is, immediately following such sale, held in substantially the same proportions as the aggregate voting power of the capital stock ordinarily entitled to elect directors of the Company immediately prior to such sale;
 

(iii)        any merger, consolidation, reorganization or similar event of the Company or any Subsidiary as a result of which the holders of the voting stock of the Company immediately prior to such merger, consolidation, reorganization or similar event do not directly or indirectly hold 50% or more of the aggregate voting power of the capital stock of the surviving entity ordinarily entitled to elect directors of the surviving entity (or, if applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of more than 50% of the aggregate voting power of the capital stock ordinarily entitled to elect directors of the surviving entity) and such voting power among the persons who were holders of the voting stock of the Company immediately prior to such sale is, immediately following such sale, held in substantially the same proportions as the aggregate voting power of the capital stock ordinarily entitled to elect directors of the Company immediately prior to such sale;

(iv)        the approval by the Company’s stockholders of a plan of complete liquidation or dissolution of the Company; or
 
(v)         during any period of 12 consecutive calendar months, individuals:
 
shall cease to constitute a majority of the Board.
 
Notwithstanding the foregoing, unless otherwise set forth in the applicable Award Agreement, for each Award subject to Section 409A of the Code, a Change in Control shall be deemed to have occurred under this Plan with respect to such Award only if a change in the ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company shall also be deemed to have occurred under Section 409A of the Code, provided that such limitation shall apply to such Award only to the extent necessary to avoid adverse tax effects under Section 409A of the Code.
 
(b)          Effect of a Change in Control.  Unless the Administrator provides otherwise in an Award Agreement, upon the occurrence of a Change in Control:
 
(i)        notwithstanding any other provision of this Plan, any Award then outstanding shall become fully vested and any restriction and forfeiture provisions thereon imposed pursuant to the Plan and the Award Agreement shall lapse and any Award in the form of an option or stock appreciation right shall be immediately exercisable;
 

(ii)       to the extent permitted by law and not otherwise limited by the terms of the Plan, the Administrator may amend any Award Agreement in such manner as it deems appropriate;
 
(iii)       a grantee who incurs a termination of employment or consultancy/service relationship or dismissal from the Board for any reason, other than a termination or dismissal “for Cause”, concurrent with or within one year following the Change in Control may exercise any outstanding option or stock appreciation right, but only to the extent that the grantee was entitled to exercise the Award on the date of his or her termination of employment or consultancy/service relationship or dismissal from the Board, until the earlier of (A) the original expiration date of the Award and (B) the later of (x) the date provided for under the terms of Section 2.4 without reference to this Section 3.5(b)(iii) and (y) the first anniversary of the grantee’s termination of employment or consultancy/service relationship or dismissal from the Board.
 
(c)          Miscellaneous.  Whenever deemed appropriate by the Administrator, any action referred to in paragraph (b)(ii) of this Section 3.5 may be made conditional upon the consummation of the applicable Change in Control transaction.  For purposes of the Plan and any Award Agreement granted hereunder, the term “Company” shall include any successor to United Maritime Corporation.
 
3.6.
Operation and Conduct of Business
 
Nothing in the Plan or any Award Agreement shall be construed as limiting or preventing the Company or any Affiliate from taking any action with respect to the operation and conduct of their business that they deem appropriate or in their best interests, including any or all adjustments, recapitalizations, reorganizations, exchanges or other changes in the capital structure of the Company or any Affiliate, any merger or consolidation of the Company or any Affiliate, any issuance of Company shares or other securities or subscription rights, any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Common Stock or other securities or rights thereof, any dissolution or liquidation of the Company or any Affiliate, any sale or transfer of all or any part of the assets or business of the Company or any Affiliate, or any other corporate act or proceeding, whether of a similar character or otherwise.
 
3.7.
No Rights to Awards
 
No Key Person or other Person shall have any claim to be granted any Award under the Plan.
 

3.8.
Right of Discharge Reserved
 
Nothing in the Plan or in any Award Agreement shall confer upon any grantee the right to continue his or her employment with the Company or any Affiliate, his or her consultancy/service relationship with the Company or any Affiliate, or his or her position as a director of the Company or any Affiliate, or affect any right that the Company or any Affiliate may have to terminate such employment or consultancy/service relationship or service as a director.
 
3.9.
Non-Uniform Determinations
 
The Administrator’s determinations and the treatment of Key Persons and grantees and their beneficiaries under the Plan need not be uniform and may be made and determined by the Administrator selectively among Persons who receive, or who are eligible to receive, Awards under the Plan (whether or not such Persons are similarly situated).  Without limiting the generality of the foregoing, the Administrator shall be entitled, among other things, to make non-uniform and selective determinations, and to enter into non-uniform and selective Award Agreements, as to (a) the Persons to receive Awards under the Plan, (b) the types of Awards granted under the Plan, (c) the number of shares to be covered by, or with respect to which payments, rights or other matters are to be calculated with respect to, Awards and (d) the terms and conditions of Awards.
 
3.10.
Other Payments or Awards
 
Nothing contained in the Plan shall be deemed in any way to limit or restrict the Company from making any award or payment to any Person under any other plan, arrangement or understanding, whether now existing or hereafter in effect.
 
3.11.
Headings
 
Any section, subsection, paragraph or other subdivision headings contained herein are for the purpose of convenience only and are not intended to expand, limit or otherwise define the contents of such subdivisions.
 
3.12.
Effective Date and Term of Plan
 
(a)         Adoption; Stockholder Approval.  The Plan was adopted by the Board on June 21, 2022.  The Board may, but need not, make the granting of any Awards under the Plan subject to the approval of the Company’s stockholders.
 

(b)          Termination of Plan.  The Board may terminate the Plan at any time.  All Awards made under the Plan prior to its termination shall remain in effect until such Awards have been satisfied or terminated in accordance with the terms and provisions of the Plan and the applicable Award Agreements.  No Awards may be granted under the Plan following the tenth anniversary of the date on which the Plan was adopted by the Board.
 
3.13.
Restriction on Issuance of Stock Pursuant to Awards
 
The Company shall not permit any shares of Common Stock to be issued pursuant to Awards granted under the Plan unless such shares of Common Stock are fully paid and non-assessable under applicable law.  Notwithstanding anything to the contrary in the Plan or any Award Agreement, at the time of the exercise of any Award, at the time of vesting of any Award, at the time of payment of shares of Common Stock in exchange for, or in cancellation of, any Award, or at the time of grant of any unrestricted shares under the Plan, the Company and the Administrator may, if either shall deem it necessary or advisable for any reason, require the holder of an Award (a) to represent in writing to the Company that it is the Award holder’s then-intention to acquire the shares with respect to which the Award is granted for investment and not with a view to the distribution thereof or (b) to postpone the date of exercise until such time as the Company has available for delivery to the Award holder a prospectus meeting the requirements of all applicable securities laws; and no shares shall be issued or transferred in connection with any Award unless and until all legal requirements applicable to the issuance or transfer of such shares have been complied with to the satisfaction of the Company and the Administrator.  The Company and the Administrator shall have the right to condition any issuance of shares to any Award holder hereunder on such Person’s undertaking in writing to comply with such restrictions on the subsequent transfer of such shares as the Company or the Administrator shall deem necessary or advisable as a result of any applicable law, regulation or official interpretation thereof, and all share certificates delivered under the Plan shall be subject to such stop transfer orders and other restrictions as the Company or the Administrator may deem advisable under the Plan, the applicable Award Agreement or the rules, regulations and other requirements of the SEC, any stock exchange upon which such shares are listed, and any applicable securities or other laws, and certificates representing such shares may contain a legend to reflect any such restrictions.  The Administrator may refuse to issue or transfer any shares or other consideration under an Award if it determines that the issuance or transfer of such shares or other consideration might violate any applicable law or regulation or entitle the Company to recover the same under Section 16(b) of the 1934 Act, and any payment tendered to the Company by a grantee or other Award holder in connection with the exercise of such Award shall be promptly refunded to the relevant grantee or other Award holder.  Without limiting the generality of the foregoing, no Award granted under the Plan shall be construed as an offer to sell securities of the Company, and no such offer shall be outstanding, unless and until the Administrator has determined that any such offer, if made, would be in compliance with all applicable requirements of any applicable securities laws.
 

3.14.
Requirement of Notification of Election Under Section 83(b) of the Code or Upon Disqualifying Disposition Under Section 421(b) of the Code
 
(a)          Notification of Election Under Section 83(b) of the Code.  If an Award recipient, in connection with the acquisition of Company shares under the Plan, makes an election under Section 83(b) of the Code (to include in gross income in the year of transfer the amounts specified in Section 83(b) of the Code), the grantee shall notify the Administrator of such election within ten days of filing notice of the election with the U.S. Internal Revenue Service, in addition to any filing and notification required pursuant to regulations issued under Section 83(b) of the Code.
 
(b)        Notification of Disqualifying Disposition of Incentive Stock Options.  If an Award recipient shall make any disposition of Company shares delivered pursuant to the exercise of an incentive stock option under the circumstances described in Section 421(b) of the Code (relating to certain disqualifying dispositions) or any successor provision of the Code, the grantee shall notify the Company of such disposition within ten days thereof.
 
3.15.
Severability
 
If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any Person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Administrator, such provision shall be construed or deemed amended to conform to the applicable laws or, if it cannot be construed or deemed amended without, in the determination of the Administrator, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, Person or Award and the remainder of the Plan and any such Award shall remain in full force and effect.
 
3.16.
Sections 409A and 457A
 
To the extent applicable, the Plan and Award Agreements shall be interpreted in accordance with Sections 409A and 457A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.  Notwithstanding any provision of the Plan or any applicable Award Agreement to the contrary, in the event that the Administrator determines that any Award may be subject to Section 409A or 457A of the Code, the Administrator may adopt such amendments to the Plan and the applicable Award Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Administrator determines are necessary or appropriate to (i) exempt the Plan and Award from Sections 409A and 457A of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (ii) comply with the requirements of Sections 409A and 457A of the Code and related Department of Treasury guidance and thereby avoid the application of penalty taxes under Sections 409A and 457A of the Code.


3.17.
Forfeiture; Clawback
 
The Administrator may, in its sole discretion, specify in the applicable Award Agreement that any realized gain with respect to options or stock appreciation rights and any realized value with respect to other Awards shall be subject to forfeiture or clawback, in the event of (a) a grantee’s breach of any non-competition, non-solicitation, confidentiality or other restrictive covenants with respect to the Company or any Affiliate or (ii) a financial restatement that reduces the amount of bonus or incentive compensation previously awarded to a grantee that would have been earned had results been properly reported.
 
3.18.
No Trust or Fund Created
 
Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Affiliate and an Award recipient or any other Person.  To the extent that any Person acquires a right to receive payments from the Company or any Affiliate pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company or its Affiliate.
 
3.19.
No Fractional Shares
 
No fractional shares shall be issued or delivered pursuant to the Plan or any Award, and the Administrator shall determine whether cash, other securities, or other property shall be paid or transferred in lieu of any fractional shares or whether such fractional shares or any rights thereto shall be canceled, terminated, or otherwise eliminated.
 
3.20.
Governing Law
 
The Plan will be construed and administered in accordance with the laws of the State of New York, without giving effect to principles of conflict of laws.
 
EX-4.9 4 ef20039046_ex4-9.htm EXHIBIT 4.9
Exhibit 4.9

Novation Agreement
 
THIS AGREEMENT is made on 28th April 2023 between:
 
(1)
V.Ships Limited, of Cyprus, with registered offices at Zina Kanther 16-18, Agia Triada, 3035 Limassol, Cyprus (the “Managers”);
 
(2)
Traders Maritime Co., of the Republic of the Marshall Islands, with registered address at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960 Marshall Islands (the “Owners”); and

(3)
V.Ships Greece Ltd., of Bermuda, with registered offices at 3rd Floor, Par-La-Ville Place, 14 Par-La-Ville Road, Hamilton HM 08, Bermuda (the “New Managers”).
 
RECITALS:
 
(A)
This Agreement is supplemental to the Ship Technical Management Agreement entered into between the Managers and the Owners in respect of the M/V “TRADERSHIP”, registered in the name of the Owners under the Marshall Islands flag with IMO No.  9310135, dated 19 May 2021 as novated by the Novation Agreement entered into between the Managers, Traders Shipping Co. and the Owners, dated 16 February 2023  (the “Contract”).
 
(B)
The Managers, the Owners and the New Managers have agreed to enter into this Agreement so that the Managers be released and discharged from the Contract as from the date to be notified by the Owners to the Managers and New Managers in writing (the “Effective Date”) and so that the Owners release and discharge the Managers with respect to the Contract from the Effective Date upon the terms of the New Managers’ undertaking to perform in all respects the Contract and be bound by its terms in place of the Managers.
 
(C)
The Contract, annexed hereto, has not been amended, varied, cancelled, novated or terminated and represents the entire agreement between the Managers and the Owners.
 
OPERATIVE PROVISIONS:
 
1
Except as amended hereby, all definitions, terms and conditions of the Contract remain in full force and effect.
 
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2
As from the Effective Date and by mutual agreement between the parties and in consideration of the mutual undertakings and releases herein contained, the New Managers shall hereby substitute the Managers under the Contract and the New Managers shall as from the Effective Date assume all rights and obligations of the Managers arising out of or in connection with the Contract.  As from the Effective Date, the New Managers and the Owners undertake to perform the Contract and be bound by its terms in every way as if the New Managers had been a party to it in place of the Managers under the Contract which shall hereafter be construed and treated in all respects as if the New Managers had been originally named as a party therein.
 
3
Save as provided in Clause 5, the Managers and the Owners hereby mutually release each other from their obligations under the Contract as from the Effective Date.
 
4
The Owners hereby agree to continue to be bound by the Contract in all respects vis-à-vis the New Managers from the Effective Date and further agree to release and discharge the Managers from any further liability under the Contract that may arise out of or with respect to events occurred after the Effective Date and accept the liability of the New Managers under the Contract from the Effective Date.
 
5
Nothing in this Agreement shall affect or prejudice any liability, claim or demand whatsoever which either the Managers or the Owners may have against the other relating to matters arising out of or with respect to events occurred prior to the Effective Date.
 
6
The Owners shall procure in respect of the Owners’ Insurances that the New Managers are named as co-assureds for protection and indemnity risks (including pollution risks) and as named assureds on all other policies, with the benefit of full cover.
 
AMENDMENTS:
 
From the Effective Date, the following amendments are agreed to in the Contract:
 

 (a)
all references made to the “Managers” in the Contract shall be deemed to mean the New Managers and not the Managers;
 

 (b)
Box 3 of Part I of the Contract will be replaced as of the Effective Date with the following:
 

 3. Managers    
 
Name:
 V.Ships Greece Ltd.  
 
Registered Address:
3rd Floor, Par-La-Ville Place, 14 Par-La-Ville
Road, Hamilton HM 08, Bermuda
  
  Country of Incorporation:
Bermuda
  
 
 
  
 
 c/o Piliou 1 & Ermoupoleos, Piraeus 18541, Greece
  
 
 
 
  
 
Telephone Number: [               ]          Fax Number: [                ]
Contact Name: (Mr.) Konstantinos Kontes          Position: Managing Director
  
 
   
  Email address: [                             ]    

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c) Craig Brown’s email in Box 6 of Part I of the Contract will be replaced as of the Effective date with the following:

[                          ] with a copy to [                           ]

LAW AND JURISDICTION
 
This Agreement shall be governed by and construed in accordance with the same laws and subject to the same jurisdiction as that provided in Clause 20 of the Contract.
 
THIS AGREEMENT has been executed by the parties to this Agreement as a deed on the date specified at the beginning of this Agreement.
 
Executed as a deed
    
By
)
/s/ Glyn Thompson
for and on behalf of
)
  
V.Ships Limited
)
  
     
Executed as a deed
    
By Stavros Gyftakis
)
/s/ Stavros Gyftakis
for and on behalf of
)
  
Traders Maritime Co.
)
  
     
Executed as a deed
    
By
 )
/s/ Konstantinos Kontes
for and on behalf of
)
  
V.Ships Greece Ltd.
)
  

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ANNEX
 

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EX-4.10 5 ef20039046_ex4-10.htm EXHIBIT 4.10
V.SHIPS SHIP MANAGEMENT AGREEMENT
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Exhibit 4.10

[Name of Owner]

and

V.SHIPS GREECE Ltd.

SHIP TECHNICAL MANAGEMENT AGREEMENT

V.SHIPS SHIP MANAGEMENT AGREEMENT
Version Number
:          01-2020

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SHIP TECHNICAL MANAGEMENT AGREEMENT

INDEX

PART
SUBJECT MATTER
PAGE NO.
     
Part I
Vessel Details
4
Part II
Terms of Agreement
  

 
1.
Definitions & Interpretation
6
 
2.
Appointment of Managers
6
 
3.
Basic Services
6
 
3.1
Crewing
 6
 
3.2
Technical Management
8
 
3.3
Purchasing
 9
 
 
3.5
Accounting and Budgeting
10
 
3.6
Operations
10
 
3.7
Information System Software
10
 
3.8
Shipboard Oil Pollution Emergency Plan
11
 
3.9
OPA
11
 
3.10
Assistance with Sale of Vessel
 12
 
3.11
Vessel trading in high risk areas
 12
 
4.
Other Services
12
 
5.
Managers’ Obligations
12
 
6.
Owners’ Obligations
 13
 
7.
Documentation
13
 
8.
Management Fee
14
 
9.
Payments and Management of Funds
15
 
10.
Managers’ Right to Sub-Contract
16
 
11.
Responsibilities
16
 
11.1
Force Majeure
16
 
11.2
Liability to Owners
16
 
11.3
Indemnity – General
16
 
11.4
Indemnity – Tax
17
 
11.5
Himalaya
17
 
 
13.
Claims/Disputes
17
 
14.
Auditing, Records
18
 
15.
Inspection of Vessel
18
 
16.
Compliance with Laws & Regulations
18
 
17.
Duration of the Agreement
19
 
17.1
Termination by Notice
19
 
17.2
Termination by Default – Owners
19
 
17.3
Termination by Default – Managers
19
 
17.4
Liquidation
19
 
17.5
Extraordinary Termination
 20
 
18.
Confidentiality
 20
 
19.
Suspension of Services
20
 
20.
Law and Arbitration
20

V.SHIPS SHIP MANAGEMENT AGREEMENT
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21.
Amendments to Agreement
21
 
22.
Time Limit for Claims
21
 
23.
Condition of Vessel
21
 
24.
Use of Associated Companies
21
 
25.
Notices
21
 
26.
Staff Loyalty
21
 
27.
Entire Agreement
22

28.
Partial Validity
22

29.
Non Waiver
 22
       
Part III
Other Services
24
Part IV
Fee Schedule
26
Part V
Fleet Details
27
Part VI
Initial Budget
28

Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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SHIP TECHNICAL MANAGEMENT AGREEMENT - PART I

  1.
Vessel Details
  
 
Name:          
EXELIXSEA
GT/NT:
 40,077 / 25,302
 
Flag:            
 MARSHALL ISLANDS
Class:
 RINA
 
Type:          
BULK CARRIER
Year Built:
 2011
 
IMO number:
 9476953
         
  2.
Owners
 
Name:
     
  2.1
Owners’ Registered Address (where the company is registered):
     
 
Country of Incorporation:
     
  2.2
Owners’ business establishment address (head office and principal place of business):
 
Telephone Number:
 Fax Number:
 
Contact Name:
 Position:
 
Email address:
     
  2.3
Owners’ VAT registration number if business establishment address at 2.2 is in the European Union
   
  3.
Managers
 
Name:
 V.SHIPS GREECE Ltd.
 
Registered Office:
 3rd Floor, Par-La-Ville Place, 14 Par-La-Ville Road, Hamilton HM 08, Bermuda
 
Country of Incorporation:  Bermuda
 
4.     Date of Commencement of Agreement (Clause 2.1)
Upon Owners’ delivery of the Vessel to the Managers, or upon any other date as may be notified by the Owners to the Managers.
  5.
Notices to Owners:   at the Owners’ Principal Place of Business address, fax number and email address stated in Box 2
 
 
  6.
Notices to Managers:
at the address, fax number and email address stated in Box 3 with a copy to Marine Legal Services Limited, 1st floor, 63 Queen Victoria Street, London EC4N 4UA tel
Email:
       

It is mutually agreed between the party mentioned in Box 2 of Part I (hereinafter called “the Owners”) and the party mentioned in Box 3 of Part I (hereinafter called “the Managers”) that this Agreement consisting of PARTS I to VI inclusive shall be performed subject to the conditions contained herein. In the event of a conflict of conditions, the provisions of an applicable Appendix of Part III shall prevail over the provisions of PART II to the extent of such conflict but only in respect of the Management Service to be provided in terms of such applicable Appendix. In the event of a conflict between the Fee Schedule and the provisions of an applicable Appendix of Part III, the provisions of the Fee Schedule shall prevail.

Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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DATE OF AGREEMENT:


Signature(s) (Owners)
Signature(s) (Managers)
   
       
   
Title:
Title:

Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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SHIP TECHNICAL MANAGEMENT AGREEMENT - PART II

1.
Definitions and Interpretation
1.1
In this Agreement, in addition to terms defined in Part I, save where the context otherwise requires, the following words and expressions shall have the meanings hereby assigned to them.
“Basic Services” means services relating to Crewing, Technical Management, Purchasing, Operations, Accounting and Budgeting, Information System Software, Shipboard Oil Pollution Emergency Plan, OPA and Assistance with Sale provided in accordance with Clause 3.
“Crew Support Costs” means all expenses of a general nature not particularly referable to any individual vessel for the time being managed by the Managers and incurred for the purpose of providing an efficient and economic management service including, without prejudice to the generality of the foregoing, cost of crew standby pay, training schemes, cadet training schemes, study pay, recruitment and interviews.
“Fee Schedule” means the Schedule comprising Part IV or any revised Fee Schedule prepared by the Managers after the date hereof and agreed by the Owners in writing to record adjustments to the fees payable from time to time under this Agreement.
“Information System Software” means the Managers’ proprietary ship management software in executable object code form as described in Clause 3.7.1 as the same may be upgraded and updated from time to time.
“ISM Code” means the International Management Code for the Safe Operation of Ships and for Pollution Prevention adopted by Resolution A.714 (18) of the International Maritime Organisation on 4 November 1994 and incorporated on 19 May 1994 into the SOLAS Convention 1974 as Chapter IX and any amendment thereto or substitution thereof.
“ISPS Code” means the International Ship and Port Facility Security Code as adopted on 12 December 2002 by resolution 2 of the Conference of Contracting Governments to the International Convention for the Safety of Life at Sea 1974 and any amendment thereto or substitution thereof.
“Management Services” means Basic Services and Other Services and all other functions performed by the Managers under the terms of this Agreement.
“MLC” means the Maritime Labour Convention 2006 and any amendment thereto, substitution thereof and ratification of the Maritime Labour Convention 2006 in the respective States national law.
“OPA” means the United States Oil Pollution Act of 1990, regulations made thereunder, and any amendment thereto or substitution thereof.
“Other Services” means any services provided by Managers affirmatively indicated in Part III of this Agreement.
“Severance Costs” means the costs which the employers are legally obliged to pay to or in respect of the Crew as a result of the early termination of any contract for service on board the Vessel.
“SMS” means a Safety Management System in accordance with the ISM Code.
“SSP” means a Ship Security Plan in accordance with the ISPS Code.
“STCW” means the International Maritime Organisation Convention on Standards of Training Certification and Watchkeeping for Seafarers 1978, as amended in 1995 and any amendment thereto or substitution thereof.
“the Vessel” shall mean the vessel details of which are set out in Box 1 of Part I.
1.2
Clause Headings are inserted for convenience and shall be ignored in construing this Agreement; words denoting the singular number shall include the plural number and vice versa; references to Parts are to Parts of this Agreement; references to Clauses are to Clauses of Part II except where otherwise expressly stated; and references to any enactment include any re-enactments, amendments and extensions thereof.

2.
Appointment of Managers
2.1
With effect from the date stated in Box 4 of Part I (the “Date of Commencement”) and continuing unless and until terminated as provided herein, the Owners hereby appoint the Managers and the Managers hereby agree to act as the managers of the Vessel in respect of the Management Services.
2.2
In performing any of the Management Services the Managers shall, as agents for and on behalf of the Owners, have authority to take such steps as the Managers may from time to time in their reasonable discretion consider to be necessary to enable them to perform this Agreement in accordance with sound ship management practice.

3.
Basic Services
Subject to the terms and conditions herein provided, during the period of this Agreement the Managers shall carry out, as agents for and on behalf of the Owners, the Basic Services in accordance with the following provisions of this Clause.
3.1
Crewing
3.1.1  The Managers shall provide suitably qualified crew for the Vessel and its trade as required by the Owners in accordance with current STCW requirements as agents for and on behalf of the Owners, provision of which includes but is not limited to the following functions:
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  (i)
select and engage Master, officers and crew (hereinafter collectively referred to as the “Crew”); where the Owners make a complaint about any member of the Crew the Managers will promptly investigate the same and if it proves to be justified, replace the Crew member concerned as soon as practicable;
 
(ii)
ensure that the applicable requirements of the law of the flag of the Vessel are satisfied in respect of manning levels, rank, qualification and certification of the Crew, and employment regulations including Crew’s tax, social insurance, discipline and other requirements;

(iii)
ensure that all members of the Crew have passed a medical examination with a qualified doctor certifying that they are fit for the duties for which they are engaged and are in possession of valid medical certificates which are valid for the duration of their service onboard the Vessel and issued in accordance with appropriate flag state requirements and P&I Club requirements; in the absence of applicable Flag state requirement medical certificate shall be dated no more than three (3) months prior to the respective Crew members leaving the country of domicile and maintained for the duration of their service on board the vessel;

(iv)
arrange of transportation of the Crew, including repatriation;

(v)
supervise the efficiency of the Crew and use the Manager’s standard crew appraisal system (written or electronic) and administration of all other Crew matters such as planning for the manning of the Vessel;

(vi)
make payroll arrangements, including settling manning and agency expenses for the manning agents in the Crew’s country of origin and, if applicable, payment of Severance Costs;

(vii)
if requested by the Owners, conducting union negotiations and making agreed payments to unions;

(viii)
verify that the Crew shall have a command of the English of a sufficient standard to enable them to perform their duties safely;

(ix)
operate the Managers’ Drug and Alcohol Policy;

(ix)
arrange Crew training in accordance with the Managers’ policies but always in compliance with STCW (and as provided for in the budget), records of such training being maintained in the Manager’s standard format and will be provided to the Owners on a monthly basis.
3.1.2
Crew Claims

The Managers will provide such information as requested by relevant brokers and/or P&I Club managers to enable such brokers or managers to prepare and process all Crew insurance claims with the Owners’ approval.
3.1.3
The Owners agree to implement and abide by all the terms and conditions of employment under which the Crew are engaged by the Crew Managers as agent for the Owners. The Owners shall be the employer of the Crew and under no circumstances shall the Crew Managers be deemed to be the employer of the Crew. The Owners authorise the Crew Managers to sign contracts of employment with the Crew as agent only for and on behalf of the Owners and/or to procure that a seafarer recruitment and placement service, in the country of domicile of each Crew member, signs a contract of employment with such Crew member as agent only for and on behalf of the Owners. If the Vessel is covered by an ITF approved agreement or any other CBA/national agreement the Owners also authorise the Crew Managers to sign the ITF approved agreement or any other CBA/national agreement on their behalf and agree to provide all information necessary for this purpose. The Managers to provide the Owners copies of the contracts of employment upon request.
3.1.4
The Owners to approve the engagement of any member of the Crew within four (4) working days of receipt from the Managers of reasonable details of the proposed appointee. No response within the stipulated timeframe indicates tacit approval.
3.1.5
In the event that any officers or ratings are supplied by the Owners or on their behalf, the Owners shall procure that they comply with the requirements of STCW and MLC. Owners will instruct such officers and ratings to obey all reasonable orders of the Managers.Any such officers or ratings shall, at the Owners’ cost, be trained in accordance with the Managers training matrix.
 
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3.1.6 The Managers shall procure that the Crew consent to processing of their personal data for legitimate business purposes. The Owners warrant that personal data of the Crew will be processed in accordance with the requirements of  all applicable laws, rules, regulation, directives and governmental requirements relating in any way to the privacy, confidentiality, security, integrity and protection of personal data, including without limitation: (a) the Philippine Data Privacy Act of 2012 and its implementing rules and regulations (together the “DPA”); (b) the EU General Data Protection Regulation 2016/679 (“GDPR”), (c) the EU ePrivacy Directive 2002/58/EC as amended by Directive 2009/136/EC, and any EU  Member State national implementing legislation; (d) applicable laws regulating unsolicited telephone calls, email, text/SMS or other electronic or anti-spam legislation; (e) applicable laws relating to data breach notification; (f) applicable laws imposing minimum information security requirements; (g) applicable laws requiring the secure disposal of records containing personal data; and (h) applicable laws regulating cross-border data transfers of personal data; (i) UK Data Protection Act 2018; and (j) the United Kingdom General Data Protection Regulation (“UK GDPR”) each as amended or superseded from time to time.

3.1.7
For the purposes of the MLC, the Owners shall be deemed “Shipowner” and under no circumstances whatsoever, notwithstanding the Managers agreeing to carry out specific obligations under the MLC on behalf of the Owners, shall the Managers be deemed “Shipowner”. It is a condition of this Agreement that the Owners shall provide all Crew with MLC compliant working and living conditions. The Owners shall ensure that, in case there is any Seafarer Recruitment & Placement Service supplying any member of the Crew to the Vessel or any entity directly employing other persons to work onboard the Vessel, the latter shall provide to the Managers documentary evidence of MLC compliance issued under the provisions laid down by the applicable ratifying administration or, in the case of a non-ratifying administration, documentary evidence from a Recognised Organisation that is accepted by the flag administration of the Vessel.
3.1.8
The Owners authorise the Managers to sign contracts of employment with the Crew as agent only for and on behalf of the Owners and/or to procure that a Seafarer Recruitment & Placement Service, in the country of domicile of a Crew member, signs contracts of employment with such Crew member as agent only for and on behalf of the Owners. The Managers to provide the Owners copies of all the contracts of employment upon request.
3.1.9
The Owners shall be responsible for the payment of wages to the Crew Managers. In accordance with the Owners instructions, the Crew Managers shall distribute the wages to the Crew as agents for and on behalf of the Owners.
3.1.10
In the event that the Crew payroll is administered by the Managers on behalf of the Owners, notwithstanding any provision herein to the contrary, the Managers do not provide advice on tax or social insurance to which the Crew may be subject. The Owners shall remain exclusively responsible and liable in respect of tax and social insurance which may be applicable to the Crew including, without limitation, advising the Managers of any tax, social insurance or other amounts required to be deducted from Crew remuneration.
3.2
Technical Management
The Managers shall provide technical management which includes, but is not limited to the following functions:

 (i)
provision of personnel to supervise the maintenance and general efficiency of the Vessel;

(ii)
arrangement and supervision of drydockings, repairs, modifications to and the upkeep of the Vessel to the standards agreed with the Owners provided that the Managers shall be entitled to incur the necessary expenditure, which is subject to Owners’ prior approval, to ensure that the Vessel will comply with all requirements and recommendations of the classification society and equipment manufacturers, and with the laws and regulations of the country of registry of the Vessel and of the places where she trades;

(iii)
arrangement of periodic analysis of the bunker fuel, lubricating oils and chemicals by third parties (the costs being included in the Vessel’s running costs);

(iv)
appointment of surveyors and technical consultants as the Managers may consider from time to time to be necessary, provided they are pre-approved by the Owners;

(v)
visits to the Vessel by superintendents or other staff of the Managers for up to 25 days on board the Vessel in any calendar year (or pro rata for part of a calendar year) excluding the dry-docking period of the vessel and visits to the Vessel by superintendents or other staff of the Managers in excess of this allowance to be pre-approved in writing by the Owners;

(vi)
notify and receive prior approval by the Owners of any non-budgeted item of expenditure;
 
(vii)
notify and receive prior approval by the Owners if there is an operational need to exceed quarterly budget allowance as attached to this agreement under Part VI.

(viii)
development, implementation and maintenance of an SMS and an SSP.
 
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3.3
Purchasing
3.3.1
The Managers shall arrange for the supply of necessary victualling, stores, spares, provisions, lubricating oils and services (including drydock services) for the Vessel for any amount of up to US$5,000. With respect to the supply of any items of an amount between US$5,000 to US$10,000 the Managers shall request the Owners pre-approval, which should be provided within 48 hours from the Managers’ request. No response within such stipulated timeframe indicates tacit approval by the Owners. For any purchase above US$10,000, the Managers will advise the details and quotations to the Owners in writing requesting authority to proceed. The Owners have the right to arrange for any purchasing and shall advise the Managers accordingly. To enable the Managers to arrange such supplies on the most advantageous terms, the Managers shall be entitled to join with other parties in making arrangements for bulk purchase. The Managers are presently members of MARCAS International Limited (“MARCAS”), a contracting association providing access to commodities and dry-dock services globally (www.marcas.org). MARCAS negotiates on behalf of its members with selected suppliers the best available price, terms and conditions for the bulk purchase of goods and services for the marine industry with the aim of offering to members and their clients savings on vessel technical operating costs.
3.3.2
Details of the suppliers contracted by MARCAS and prices available for the Vessel at the time of supply shall be made available to Owners upon their request. Owners acknowledge that all information relating to prices is confidential and undertake not to disclose the same to third parties without the prior written consent of the Managers.
3.3.3
Where MARCAS has negotiated terms and conditions with suppliers of any stores, spares provisions, or lubricating oils (“Goods”) and/or suppliers of services required by the Vessel, then the purchase of such Goods and services will, unless operational or other circumstances otherwise require, be undertaken with such suppliers on the basis of the terms and conditions negotiated by MARCAS.
3.3.4
MARCAS will where practicable obtain a best price charter from suppliers that the prices for all Goods and services purchased by MARCAS’s members will be the lowest prices available. If the Owners are able to obtain in good faith, on arms’ length terms, on a true like for like basis (including quality, certification, timing, manufacturer, place of supply, etc., but ignoring taxes and exchange rate fluctuations), the same Goods and/or services at a lower price than that obtained by MARCAS, the Owners will supply full details to the Managers who will promptly raise the matter with MARCAS and pass on to Owners any refund obtained by MARCAS from the supplier.
3.3.5
The Owners have received details from the Managers of the business rules and operating procedures adopted by MARCAS, including provisions related to fees that MARCAS will retain as applicable, and agree to comply with such rules and operating procedures as the same may be amended from time to time.
3.3.6
The Owners acknowledge that they are aware that prices obtained from suppliers require strict adherence to the payment terms agreed with suppliers (normally 45 days from date of invoice) and any failure by the Owners to provide the Managers with funds to settle sums due to suppliers on time will (in the absence of a good faith dispute) result in an immediate 2% surcharge. The Managers are hereby expressly authorised to settle such surcharge charges from any sums held by them on behalf of Owners. The Owners further acknowledge that they are aware if payments to suppliers are regularly made late, or if suppliers are not satisfied with Owners’ credit rating, suppliers may refuse to supply at the prices and on the terms negotiated by MARCAS.
3.3.7
The Owners acknowledge that the Managers may be requested by suppliers to disclose details of the beneficial ownership of the Owners and that the Managers may not be able to obtain the most advantageous terms from such suppliers should the Owners not agree to such disclosure.

NOT APPLICABLE
 
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3.5
Accounting and Budgeting
3.5.1
The Managers shall:
 
(i)
maintain records of all costs and expenditure incurred hereunder as well as data necessary or proper for the settlement of accounts between the parties;
 
(ii)
establish an accounting system for the Vessel and supply regular monthly reports (within 5 working days from the end of the preceding month) in accordance therewith in the Managers’ standard format or, on agreement of an additional fee, such other form as may be mutually agreed in writing with the Owners.
3.5.2
The Managers shall present to the Owners annually a budget for the following calendar year in the Managers’ standard format. The budget for the period in 2023 following the date stated in Box 4 of Part I is set out in Part VI.
3.5.3
The Owners shall notify the Managers of their acceptance and approval of the annual budget within 14 days of presentation and in the absence of any response the Owners shall be deemed to have accepted the said budget. In the event that the Owners do not accept an annual budget presented by the Managers within the period aforesaid and that budget is, in the reasonable opinion of the Managers, fair and reasonable, the Managers shall be entitled to terminate this Agreement by notice in writing, in which event this Agreement shall terminate on the expiry of a period of one (1) month from the date upon which such notice is given.
3.5.4
The Managers shall produce a monthly comparison between budgeted and actual expenditure of the Vessel in the Managers’ standard format or, on agreement of an additional fee, such other form as may be mutually agreed in writing accompanied by proper written justification of variances reports. In addition if required by the Owners the Managers shall produce quarterly forecast report on the annual budget.
3.5.5
This Clause 3.5 is subject to the provisions of Part VI.

3.6 Operations
In cases requested and always in co-operation with the Owners, the Managers shall, as agents for the Owners, provide support for the appointment of agents.

3.7
Information System Software
3.7.1
The Managers will, subject to the remaining provisions of this Clause 3.7, provide the Owners and the Vessel with the Information System Software to allow information from both the Vessel’s and the Managers’ office to be accessed directly by the Owners via the “PartnerShip Network” secure website. Financial, technical and operational information relating to the Vessel will be available from both the Vessel and office outputs, with the ability to “drill down” on accounts. This will provide the Owners with immediate access to the same information available to the Managers and to reports generated for the Owners, with a view to providing improved efficiency and cost savings to the Owners in his overview of the management of the Vessel.
3.7.2
Should the Owners have existing software applications on board the Vessel which they wish to retain, the Owners will permit the Managers to carry out an on board audit to assess the suitability, compatibility with the Information System Software, and any risks or disadvantages associated with the continued use of such applications.
3.7.3
The main features of the Information System Software at the date of this Agreement are:

(i)
comprehensive management software providing single point of entry to the Vessel incorporating Crew administration, vessel noon reporting, operational and port reporting, defect and deficiency reporting and performance monitoring;

(ii)
a ship to shore and shore to ship e-mail package providing cost efficient communications available to both Owners and their charterers; and
 
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  (iii)
a computerised maintenance system including inventory control and automated purchase order handling. (An initial charge, to be agreed with Owners, may be made for the set-up of the maintenance database, depending on the system currently existing on board the Vessel).
3.7.4
The costs for the Information System Software are set out in the Fee Schedule, and are included in the Vessel’s running costs, as follows:

(i)
the license fee;

(ii)
remote access from the Owners’ Office through the Managers’ PartnerShip network;

(iii)
maintenance, updates and upgrades;

(iv)
24 hour support;

(v)
provision of anti-virus software and regular upgrades;

(vi)
operational manuals on CD ROM and regular updates;
  (vii)
annual remote audit of the Vessel IT systems providing a system health check;

(viii)
user manuals and training of the Crew in the use of the Information System Software; and

(ix)
e-mail on board the Vessel.
3.7.5
Such costs do not include:

(i)
the costs of appropriate hardware on board the Vessel;

(ii)
travel and other related costs for installation support of the Information System Software on board the Vessel;

(iii)
the set-up cost of the data base for the maintenance system; the Client remains an owner of the PMS data, which can be exported at any given time on request.

(iv)
any specific reports specified by the Owners where new data/specialist reporting is required; and
 
(v)
costs incurred pursuant to clause 3.7.2.
3.7.6
Installation and set-up of the Information System Software will be undertaken on a date agreed between the Managers and the Owners having regard to the Vessel’s schedule and the availability of the Managers’ personnel.
3.7.7
Solely for the duration of this Agreement the Managers hereby grant the Owners a personal, non-transferable non-exclusive license to use a single copy of the Information System Software as installed by the Managers on a single computer on board the Vessel.
3.7.8
The Information System Software is owned by the Managers or its subsidiaries and is protected by applicable copyright and patent laws. The Owners may not copy the Information System Software (except for back-up purposes only) or any written materials which accompany it, and may not sell, rent, lease, lend, sub-license, reverse engineer or distribute the Information System Software or such written materials.
3.7.9
The Managers do not warrant that the Information System Software will meet the Owners’ requirements or that the use or operation of the Information System Software will be uninterrupted or error free.

3.8
Shipboard Oil Pollution Emergency Plan
3.8.1
The Managers will prepare and obtain all necessary approvals for a shipboard oil pollution emergency plan (SOPEP) in a form approved by the Marine Environment Protection Committee of the International Maritime Organisation pursuant to the requirements of Regulation 26 of Annex I of the International Convention for the Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978 relating thereto, as amended (MARPOL 73/78).
3.8.2
The SOPEP will be written in the English language and will be reviewed and updated from time to time. If required the Managers will arrange for the translation of the SOPEP into another language, the cost of translation being recoverable in terms of Clause 8.5.
3.8.3
The Managers will also undertake regular training of the Crew in the use of the SOPEP including drills to ensure that the SOPEP functions as expected and that contact and information details specified are accurate.

3.9
OPA
3.9.1
If instructed by the Owners, the Managers will:

(i)
arrange for the preparation, filing and updating of a contingency Vessel Response Plan in accordance with the requirements of OPA and instruct the Crew in all aspects of the operation of such plan;

(ii)
identify and ensure the availability by contract or otherwise of a Qualified Individual, a Spill Management Team, an Oil Spill Removal Organisation, resources having salvage, firefighting, lightering and, if applicable, dispersant capabilities, and public relations/media personnel to assist the Owners to deal with the media in the event of discharges of oil.
3.9.2
The Managers are expressly authorised as agents for the Owners to enter into such arrangements by Contract or otherwise as are required to ensure the availability of the services outlined in Clause 3.8.1. The Managers are further expressly authorised as agents for the Owners to enter into such other arrangements as may from time to time be necessary to satisfy the requirements of OPA or other Federal or State laws.
 
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3.9.3
The Owners will pay the fees due to third parties providing the services described above together with costs to the Managers if any. The level of fees will be included in the Vessel’s running costs.
3.9.4
On termination of this Agreement, the Vessel Response Plan and all documentation will be returned to the Managers at the expense of the Owners, provided such expense does not exceed US$150.

3.10
Assistance with Sale of Vessel
The Managers shall, if requested, provide Owners with technical assistance in connection with any sale of the Vessel. The Managers will, if requested in writing by the Owners, comment on the terms of any proposed Memorandum of Agreement, but the Owners will remain solely responsible for agreeing the terms of any Memorandum of Agreement regulating any sale.

3.11
Vessel trading in high risk areas
In the event that the Vessel is to trade in a high risk area and in particular an area where piracy is prevalent, the Managers shall:
 
(i)
Comply in full with the guidance provided by ‘Best Management Practices to Deter Piracy off the Coast of Somalia and in the Arabian Sea Area (BMP)’ as may be revised from time to time and also with any similar guidance which may be issued for other high risk areas.

(ii)
Monitor daily guidance and updates provided by The Maritime Security Centre – Horn of Africa (MSCHOA) website (www.mschoa.org) as may be revised from time to time and advise the Vessel accordingly.

(iii)
Comply with the Managers’ guidelines for ‘Transiting off the coast of Somalia, the Arabian Sea, Gulf of Aden and Red Sea’ as may be revised from time to time and also with any similar guidance which may be issued for other high risk areas. The Managers’ guidelines set out their policy of full compliance with BMP and additional guidance and information on Self Protection Measures (SPM’s) and Citadels or Safe Areas. The Owners will be provided with a copy of the guidelines and costs for SPM’s will be included in the Vessel budget.

(iv)
Where appropriate, ensure the Vessel follows the International Recommended Transit Corridor (IRTC), using the services of an escorted convoy if available or joining a group transit if not.

(v)
Monitor routing recommendations for transiting high risk areas as provided by charterers and insurers and review the same as part of the risk assessment carried out for the transit concerned.
 
(vi)
Provide sufficient Self Protection Measures (SPM) appropriate to the vessel type, size and speed with a view to protecting the Crew as far as possible in the event of an attack. To be determined by the risk assessment required by BMP for the transit concerned and before entering the high risk area.

(vii)
Provide training for the Crew in BMP prior to transiting any high risk area.

4.
Other Services
4.1
Subject to the terms and conditions herein provided, during the period of this Agreement the Managers shall carry out, as agents for and on behalf of the Owners, such Other Services as shall have been indicated in Part III.
4.2
Other Services shall be provided in accordance with the terms of the Appendices contained in Part III.

5.
Managers’ Obligations
5.1
The Managers undertake to use their best endeavours to provide the Basic Services, the Other Services and the Management Services as agents for and on behalf of the Owners in accordance with sound ship management practice and to protect and promote the interests of the Owners in all matters relating to the provision of Management Services provided however that the Managers in the performance of Management Services shall be entitled to have regard to their overall responsibility in relation to all vessels which may from time to time be entrusted to their management and in particular, but without prejudice to the generality of the foregoing, the Managers shall be entitled to allocate available supplies, manpower and services in such manner as in the prevailing circumstances the Managers in their reasonable discretion consider to be fair and reasonable.
5.2
The Managers shall procure that the requirements of the law of the flag of the Vessel are satisfied and they shall be deemed to be “the Company” as defined by the ISM Code, assuming the responsibility for the operation of the Vessel and taking over the duties and responsibilities imposed by the ISM Code and by the ISPS Code.
5.3
The Managers undertake the responsibility to cooperate fully with the Owner and/or any other third party audit firm the Owner chooses with regard to the establishment (design) and the annual testing of the internal controls followed by the Manager relating to the operations performed during providing the services described herein to the Owners (provision of Type II SSAE16 report included).
 
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6.
Owners’ Obligations
6.1
The Owners shall pay all sums due to the Managers punctually in accordance with the terms of this Agreement. Time shall be of the essence in respect of the payment of all such sums.
6.2
The Owners shall report (or where the Owners are not the registered owners of the Vessel procure that the registered owners report) to the flag state administration the details of the Managers as the Company as required to comply with the ISM Code.
6.3
The Owners shall procure that throughout the period of this Agreement the Vessel will be insured at the Owners’ expense for not less than sound market value or entered for full gross tonnage, as the case may be, for:

(i)
usual hull and machinery risks (including but not limited to Crew negligence) and excess liabilities;

(ii)
protection and indemnity risks (including but not limited to pollution risks, diversion expenses and Crew risks);

(iii)
freight, defense and demurrage;

(iv)
war risks (including but not limited to blocking and trapping, protection and indemnity, terrorism and Crew risks); and

(v)
in accordance with MLC, establish insurance to compensate Crew, and/or any officers or ratings supplied by the Owners or on their behalf, for monetary loss that they may incur as a result of the failure of a recruitment and placement service or Owners under the employment agreement, to meet its obligations to them; and

(vi)
such other optional insurances as may be agreed by the Owners (such as piracy, kidnap and ransom, loss of hire)
in accordance with the best practice of prudent owners of vessels of a similar type to the Vessel, with sound and reputable insurance companies underwriters or associations (provided that, protection and indemnity risks must be placed with a member of the International Group of P&I Clubs) (“the Owners’ Insurances”).
6.4
The Owners shall procure that all premiums and calls on the Owners’ Insurances are paid by their due date and that the Owners’ Insurances name the Managers and any additional party designated by the Managers as a joint assured for protection and indemnity risks (including pollution risks) and a named assured on all other policies, with the benefit of full cover. The Owners shall, if applicable, provide the Managers with written evidence thereof to the reasonable satisfaction of the Managers on or prior to the Date of Commencement and/or on the date on which the Managers notify the Owners of the appointment of any additional party and within seven (7) days of each renewal date. The Owners shall provide Managers with an appropriate certificate of insurance covering any and all liabilities under the MLC including but not limited to financial security in accordance with regulation 2.5.
6.5
On termination of this Agreement (howsoever occasioned) or where the Owners make a change in the P&I Club in which the Vessel is entered, the Owners shall procure that the Managers and any additional party designated by the Managers as a joint or named assured shall cease to be a joint or named assured.

6.6
Owners are responsible for the payment of any tonnage tax applicable at the country where this agreement will be officially registered.
6.7
The Owners are responsible to maintain this management agreement for a minimum period of two (2) months.

7.
Documentation
7.1
On or prior to the Date of Commencement the Owners will deliver to the Managers:
(i) copies of the Vessel’s Certificate of Registry,
(ii) copies of all the Vessel’s trading and classification certificates,
(iii) a copy of the Owners’ certificate of incorporation,
(iv) full details of any resident registered agent for the registered owner of the Vessel,
(v) if applicable, a copy of the bareboat charterparty pursuant to which the Owners are disponent owners of the Vessel,
(vi) in the case of a new vessel, the Owners will deliver a copy of the Building Contract and specification, and in the case of a second hand vessel, a copy of the Memorandum of Agreement in terms of which the Owners acquired the Vessel. The Owners shall be entitled to delete any confidential information (such as price) from the Building Contract or Memorandum of Agreement,
(vii) if the Owners are not the registered owners or the bareboat charterer of the Vessel, in addition to the above, evidence satisfactory to the Managers of their beneficial interest in the Vessel and of their authorisation from the registered owners to enter into this Agreement,
(viii) the name and address of the bank through which the Owners will pay funds due under this Agreement.
In any event, the Managers reserve the right to request evidence satisfactory to them that the Owners are in goodstanding and that the person signing this Agreement on their behalf is duly authorized to do so.
 
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7.2
The Owners will on request provide the Managers with full details, in writing, of the registered Owners.
7.3
The Owners shall be obliged to obtain any required guarantee, bond or other security including, without limitation, the SCAC code and International Carrier Bond as required in order to access the US Bureau of Customs and Border Protection automated manifest system, as required by 68 Fed Reg. 68139 and as amended, and USCG Certificate of Financial Responsibility for water pollution. The Owners shall also be obliged to obtain any permits, licences or the like required to be obtained by an operator of a vessel including, without limitation, the US EPA vessel general permit.
7.4
At the request of the Owners, the Managers will promptly deliver a duly executed technical manager’s undertaking and subordination to the Owners’ lenders’ rights. The Managers further agree that they will cooperate with the Owners’ lenders in providing such undertaking and subordination letter and any other further documentation which may be required by the Owners’ lenders.

8.
Management Fee
8.1
The Owners shall pay to the Managers a fee in the amounts stated in the Fee Schedule in respect of the Basic Services and Other Services which shall be payable by equal monthly installments, the first installment being payable on the Commencement of this Agreement and the payment of the agreed monthly budgeted amounts fifteen (15) days prior to the purchase of the Vessel including payment of the agreed pre-delivery budget and one (1) month fee applicable for the pre-delivery work in respect of the vessel and subsequent installments being payable monthly in advance and fees for Other Services (if applicable) shall be paid at the rates and times specified in the Fee Schedule.
8.2
If the Managers’ superintendents or other staff spend more than 25 days onboard the Vessel in any calendar year but excluding the dry-docking period of the vessel (or pro rata for part of a calendar year) such days in excess of 25 on board the Vessel shall be charged at the rate of US$650 per man per day.
8.3
Where a charterers vetting inspection may be required and a pre-inspection is requested, the costs of such additional services shall be charged to the Vessel’s account.
8.4
If the Vessel is placed on time charter, any costs incurred in complying with charterers requirements (including, but not limited to, additional reporting requirements and visits to the charterers) will be paid by the Owners.
8.5
The Managers shall, at no extra cost to the Owners, provide their own office accommodation, office staff and office stationery. The Owners shall reimburse the Managers for all expenses properly incurred under the terms of this Agreement on behalf of the Owners, including, without prejudice to the foregoing generality, postage and communication expenses (which the Managers shall allocate among all vessels managed by them on a basis which the Managers consider to be fair and reasonable having regard to the trade of the vessels, the nationality of the Crews and other relevant factors), Crew Support Costs (as included in the Vessel’s running costs), vessel documentation, administrative expenses of the SOPEP and SSP, travelling expenses and other out of pocket expenses properly and reasonably incurred by the Managers in pursuance of the Management Services. All the above costs will be incurred by the Managers, provided they have been approved by the Owners.
8.6
In the event of the termination of this Agreement on the completion of the two (2) months minimum period the fees payable to the Managers according to the provisions of Clause 8.1 shall, save as aftermentioned, be paid for a further period of two (2) calendar months from the effective date of termination. After that minimum period of the Agreement there will be only one (1) month fees applicable upon termination subject to agreement that the total value of management fees paid will be at least equivalent to four (4) months.
8.7
Fees payable to the Managers will be reviewed annually and shall be adjusted as a minimum by reference to the retail price index relevant to the domicile of the Managers. Where Management Services are wholly or partly provided by third parties, the fees therefor shall be adjusted immediately to take account of increases in the cost of such services. The Managers will, however, use all reasonable endeavours in negotiations with such third parties to minimise such increases.
8.8
All fees are exclusive of Value Added Taxes, if any, or other applicable taxes.
8.9
Save as otherwise provided in this Agreement, all discounts, rebates and commissions obtained by the Managers in the course of the management of the Vessel shall be credited to the Owners.
8.10
If as a result of collision, accident, emergency, or any other extraordinary circumstances, the Managers’ workload is increased beyond that which the parties could reasonably have anticipated, the Managers shall be entitled to reasonable additional remuneration having regard to the nature of the incident, the personnel and resources of the Managers deployed, and all other relevant circumstances including insurance recoveries.
8.11
If the Owners decide to lay-up the Vessel and such lay-up lasts for more than two (2) months, an appropriate reduction of the management fee for the period exceeding the two (2) months until the Owners give written notice to remobilize the Vessel, shall be mutually agreed between the parties.
 
Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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9.
Payments and Management of Funds
9.1
All sums paid to the Managers by or on behalf of the Owners and all moneys collected by the Managers under the terms of this Agreement (other than fees payable by the Owners to the Managers) shall be held to the credit of the Owners in a separate bank account or accounts which shall be operated by the Managers. The Owners agree to provide to the Managers all information and documentation reasonably required to comply with banking “know your customer” procedures.
9.2
Where any sums howsoever arising and whether in respect of fees, budgeted expenditure, non-budgeted expenditure, other liabilities (present, future, liquidated or unliquidated) or expenses are owed to the Managers in connection with the Vessel, the Managers shall be entitled but not obliged at any time or times to apply any sums standing to the credit of the accounts referred to in Clause 9.1 to settle such sums but shall in any event remain payable by the Owners to the Managers on demand.
9.3
On or prior to the Date of Commencement the Owners shall provide to the Managers an amount equivalent to the prorated budgeted days’ expenditure from the Date of Commencement to the end of the first month in management. In addition all pre-delivery expenses are to be funded promptly by the Owners on request from the Managers. The Owners shall provide an amount equivalent to 1/12 of the annual budget for the first full month on or prior to the 1st day of the first full month of the management period. In subsequent months the Managers shall request amounts for the total anticipated monthly expenditure as laid out in clause 9.6.
9.4
On or prior to the Date of Commencement the Owners shall provide to the Managers a sum of US$17,000, which shall be available to the Managers in their sole discretion for payment of any sum due under the terms of this Agreement, which sum will be held in the Manager’s bank account (“the Float”). The Owners agree that on termination of this Agreement the Managers shall be entitled to retain all or part of the Float in payment of any sums then outstanding under the terms of this Agreement and, subject thereto, the Managers shall reimburse the balance of the Float to the Owners within two (2) months after the termination of this agreement.
9.5
The Owners agree that on termination of this agreement payment of all sums outstanding under the terms of the agreement are to be made in advance of the Vessel leaving management. The sum will include without prejudice to the generality of the foregoing, any amounts due to be paid to suppliers and other third parties (as evidenced, in the absence of manifest error, by an accounts payable listing produced by the Managers) and any outstanding accruals for items or services invoiced or delivered. The Owners irrevocably undertake to pay forthwith on request from the Managers any other sums which become due after the effective date of termination, but have been incurred during the prosecution of this Agreement.
9.6
The Managers shall each month request (by letter, telex, fax or e-mail) from the Owners the funds required to run the Vessel for the ensuing month. Such request will be for the total of the anticipated monthly expenditure, including, without prejudice to the generality of the foregoing, any sums due to be paid to suppliers and other third parties in the ensuing month (as conclusively evidenced, in the absence of manifest error, by an accounts payable listing produced by the Managers) and any outstanding accruals for items or services invoiced or delivered. In addition, the Owners shall provide the Managers upon request with any funds which the Managers may reasonably request to cover any unbudgeted, unexpected, occasional or extraordinary item of expenditure. All such funds shall be received by the Managers within five (5) days after the receipt of such requests and shall be held to the credit of the Owners in the account(s) referred to in Clause 9.1. The Managers shall be entitled to allocate such funds in such manner as the Managers reasonably determine, and it shall not be open to the Owners to direct the Managers otherwise and under no circumstances shall any funds received be held on trust by the Managers for any specific purpose. In case there is any surplus of funds, same will be applied on the quarterly budget.
9.7
Notwithstanding anything contained herein, the Managers shall in no circumstances be required to use or commit their own funds to finance the provision of the Management Services and all payments due shall be made punctually to the Managers (and not any third party) in accordance with the terms of this Agreement in full without any deduction whatsoever.
9.8
In addition to the funds referred to above the Owners shall pay and/or reimburse the Managers in respect of all expenses incurred prior to the Date of Commencement including, but not limited to, riding Crew wages, initial Crew movements, Crew standby expenses, communication and liaison expenses and ITF welfare contributions.
 
Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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:          01-2020

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10.
Managers’ Right to Sub-Contract
10.1
The Managers shall be entitled to procure performance of the Managers’ obligations hereunder by their parent, subsidiary or associated companies or (in the case of Other Services) third parties (hereinafter collectively called the “Sub-Managers”) in accordance with the following provisions of this Clause 10.1, provided that the Owners have given their prior written consent:

(i)
any such performance of all or any of the Managers’ obligations by the Sub-Managers shall be and constitute full and sufficient performance by the Managers of their obligations hereunder;

(ii)
the Owners hereby agree with the Managers that insofar as the Sub-Managers perform the obligations of the Managers the Sub-Managers shall be entitled to the benefits of the provisions of Clause 11; and

(iii)
any performance of the Managers’ obligations by the Sub-Managers shall be without prejudice to the rights of the Owners hereunder for any failure by the Managers in performance of the Managers’ duties and obligations hereunder and notwithstanding performance by the Sub-Managers the Managers shall remain responsible to the Owners for performance of their obligations hereunder.
10.2
The provisions of Clause 10.1 shall remain in force notwithstanding termination of this Agreement.

11.
Responsibilities

11.1
Force Majeure
11.1.1
Neither the Owners nor the Managers shall be liable for any loss or damage or total or partial failure to perform this Agreement (other than a failure to perform an obligation to pay money) caused wholly or partly by any circumstance or matter beyond the reasonable control of the relevant party, as the case may be, including (without limiting the generality of the foregoing) acts of God, acts of governmental authorities, fires, strikes, floods, epidemics, quarantine restrictions, wars, insurrections, riots, violent demonstrations, criminal offences (other than criminal offences attributable to each Party’s employees, agents or sub-contractors), acts and omissions of civil or military authority or of usurped power, requisition or hire by any governmental or other competent authority, embargoes.
11.1.2
Where a party seeks to rely upon a force majeure event as described in Clause 11.1.1 it will advise the other party of the force majeure event at the earliest opportunity and also advise that party of the likely duration of such force majeure situation.
11.2
Liability to Owners

(i)
Without prejudice to Clause 11.1, the Managers shall be under no liability whatsoever to the Owners for any loss, damage, delay or expense of whatsoever nature, whether direct or indirect, (including but not limited to loss of profit arising out of or in connection with detention of or delay to the Vessel) and howsoever arising in the course of performance of the Management Services unless same is proved to have resulted solely from the negligence, gross negligence or wilful default of the Managers or their employees or agents, or sub-contractors employed by them in connection with the Vessel, in which case (save where loss, damage, delay or expense has resulted from the Managers’ personal act or omission committed with the intent to cause same or recklessly and with knowledge that such loss, damage, delay or expense would probably result) the Managers’ liability for each incident or series of incidents giving rise to a claim or claims shall never exceed a total of ten times the annual management fee payable hereunder for Basic Services.
 
(ii)
Notwithstanding anything that may appear to the contrary in this Agreement, the Managers shall not be responsible for any of the acts or omissions of the Crew even if such acts or omissions are negligent, grossly negligent or wilful, except only to the extent that they are shown to have resulted from a failure to discharge their obligations under Clause 3.1 in which case their liability shall be limited in accordance with the terms of this Clause 11.

11.3
Indemnity - General
Except to the extent and solely for the amount therein set out that the Managers would be liable under Clause 11.2, the Owners hereby undertake to keep the Managers and their employees, agents and sub-contractors indemnified and to hold them harmless against all actions, proceedings, claims, demands or liabilities whatsoever or howsoever arising out of or in connection with the performance of this Agreement, including, but not limited to, any and all liability arising under the MLC, and against and in respect of all costs, loss, damages and expenses (including legal costs and expenses on a full indemnity basis) which the Managers may suffer or incur (either directly or indirectly) in the course of the performance of this Agreement.
 
 
Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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:          01-2020

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11.4
Indemnity - tax
11.4.1 Without prejudice to the general indemnity set out in Clause 11.3, the Owners hereby undertake to keep the Managers, their employees, agents and sub-contractors indemnified and to hold them harmless against all taxes, imposts and duties levied by any government as a result of the trading or other activities of the Owners or the Vessel and that whether or not such taxes, imposts and duties are levied on the Owners or the Managers.

11.4.2 If the Owners are required to deduct or withhold taxes from any payments to the Crew Managers under this Agreement, then:

 
(i)
the Owners shall make such deductions and withholdings in accordance with all applicable laws;
 
(ii)
the Owners shall pay the full amount deducted or withheld to the appropriate governmental authority in accordance with all applicable laws; and
 
(iii)
the sum payable to the Crew Managers shall be increased by such additional amounts as necessary so that after making all required deductions and withholdings of taxes, the Crew Managers receive an amount equal to the sum they would have received had no such deductions of withholding taxes been required to be made.

11.5
“Himalaya”
Subject to any provision of the Agreement to the contrary, it is hereby expressly agreed that no employee or agent of the Managers (including every sub-contractor from time to time employed by the Managers and the employees of such sub-contractors) shall in any circumstances whatsoever be under any liability whatsoever to the Owners for any loss, damage or delay of whatsoever kind arising or resulting directly or indirectly from any act neglect or default on his part while acting in the course of or in connection with his employment and, without prejudice to the generality of the foregoing provisions in this Clause, every exemption, limitation, condition and liberty herein contained and every right, exemption from liability defense and immunity of whatsoever nature applicable to the Managers or to which the Managers are entitled hereunder shall also be available and shall extend to protect every such employee or agent of the Managers acting as aforesaid and for the purpose of all the foregoing provisions of this clause 11 the Managers are or shall be deemed to be acting as agent or trustee on behalf of and for the benefit of all persons who are or might be their servants or agents from time to time (including sub-contractors as aforesaid) and all such persons shall to this extent be or be deemed to be parties to this Agreement.
11.6
The provisions of Clause 11 shall remain in force notwithstanding termination of this Agreement.

Liens

          

13.
Claims/Disputes

13.1
At the request of the Owners, the Managers shall handle and settle all claims arising out of the Management Services hereunder and keep the Owners informed regarding any incident of which the Managers become aware which gives or may give rise to claims or disputes involving third parties.
13.2
The Managers shall, as instructed by the Owners, bring or defend actions, suits or proceedings in connection with matters entrusted to the Managers according to this Agreement.
13.3
The Managers in cooperation with the Owners shall have power to obtain legal or technical or other outside expert advice in relation to the handling and settlement of claims and disputes or all other matters affecting the interests of the Owners in respect of the Vessel.
13.4
The Owners shall arrange for the provision of any necessary guarantee bond or other security.
13.5
The Owners agree to the use of MTI Network for crisis management response and agree to pay any fees additional to the annual retainer of MTI Network (as included in the budget) which may be incurred.

Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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14.
Auditing, Records
14.1
The Managers shall at all times maintain and keep true and correct accounts and shall make the same available at the Managers’ offices for inspection and auditing by the Owners at such times as may be mutually agreed. The Owners agree that the Managers shall be entitled to charge for their reasonable costs and expenses should the Owners require hard copies of supplier invoices and related documentation.
14.2
The Managers shall be entitled to electronically archive all of the Vessels’ records and arrange safe storage of the same, the costs being included in the Vessel’s running costs.
14.3
All accounting and other records relating the Vessel will be retained by the Managers for a period of two (2) years after the date of termination, for whatever reason, of this Agreement, and thereafter shall be destroyed or, if electronically archived, expunged unless the Owners request the Managers to deliver such records to them at the Owners’ expense.
14.4
The Managers may request and the Owners shall, in a timely manner, make available all documentation, information and records reasonably required by the Managers to enable them to perform the Management Services.

15.
Inspection of Vessel
The Owners shall have the right at any time to inspect the Vessel for any reason they consider necessary. The Owners will, where practicable, give reasonable notice to the Managers of their intention to visit the Vessel. After such inspection should Owners advise Mangers of reasonable comments about the Vessel’s condition and the Crew’s performance, Managers undertake to take necessary rectifying actions at the Owners expense.

16.
Compliance with Laws and Regulations
16.1
The parties will not do or permit anything to be done which might cause any breach or infringement of the laws and regulations of the country of registry of the Vessel, and of the places where she trades, provided always that the Managers’ obligations under this Clause will only relate to matters which the Managers are in fact capable of fulfilling and on the understanding that the Managers receive all necessary co-operation, information and funding from the Owners.
16.2
The Parties undertake, represent and warrant that on concluding this Agreement neither they, their Crew, nor any of their employees, agents, or sub-contractors is a Sanctioned Person.

The Parties warrant compliance with Global Trade Laws applicable directly or indirectly to the performance of this Agreement, and undertake that they will not, through any act or omission, place the other in violation of Global Trade Laws.
The Parties accept the requirement of this Clause as a condition of this Agreement entitling the innocent party, without prejudice to any claim for damages for breach of this Agreement to immediately terminate this Agreement should there be a breach, or known future conduct that would likely cause a breach (as determined by either Party in its reasonable discretion), of any of these prohibitions at the innocent Party’s absolute discretion. The Party in breach shall indemnify and hold harmless the innocent Party, its employees, agents and sub-contractors in respect of any loss suffered by any of them as a result of violations of this Clause including any penalties or costs associated with government investigations or enforcement actions under Global Trade Laws.
The Parties accept that the US, EU, and other relevant authorities may from time to time establish or change the applicable Global Trade Laws, and both Parties acknowledge that such an event may render continued performance by either or both under this Agreement illegal or unlawful. In that event and if either Party terminates this Agreement due to a change in US, EU, or other applicable sanctions, both Parties agree that (i) such termination shall not constitute a breach of this Agreement by the Party terminating, and the other Party waives any and all claims against the terminating Party for any loss, cost or expense, including consequential damages, that the other Party may incur by virtue of such termination; and (ii) both Parties agree to take reasonable steps to cooperate in winding down this Agreement.
In this Clause the following words and expressions shall have the meanings hereby assigned to them:

“Embargoed Country” means any country or geographic region subject to comprehensive economic sanctions or embargoes administered by the  U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) or the EU, including without limitation Cuba, Iran, North Korea, Syria, the Donetsk and Luhansk People’s Republics and the Crimea region.
 
Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
Version Number
:          01-2020

Page Number
:          19 of 30
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“Global Trade Laws” means  the US Export Administration Regulations; the US International Traffic in Arms Regulations; the economic sanctions rules and regulations administered by OFAC as well as any relevant Executive Orders; the sanctions and export control rules and regulations administered by competent authorities in the United Kingdom, including but not limited to sanctions regimes implemented under the UK Sanctions and Anti-Money Laundering Act 2018, European Union Council Regulations on export controls, including Nos. 428/2009, 267/2012; other EU Council sanctions regulations, as implemented in EU Member States; United Nations sanctions policies; all relevant regulations made under any of the foregoing; and other applicable economic sanctions or export and import control laws.
 
“Sanctioned Person”  means at any time: (a) any person or entity included on: OFAC’s Specially Designated Nationals and Blocked Persons List, the Sectoral Sanctions Identifications List, or the Foreign Sanctions Evaders List; the EU’s Consolidated List of Sanctions Targets; the UK Consolidated List of Asset Freeze Targets and list of persons named in relation to financial and investment restrictions; or any similar list; (b) any person resident in, or entity organised under the laws of, an Embargoed Country; or (c) any person or entity majority-owned or controlled or acting on behalf of any of the foregoing.

 17.
Duration of the Agreement
 
17.1
Termination by Notice
This Agreement shall come into effect on the Date of Commencement for a minimum period of two (2) months and shall continue thereafter until terminated by either party giving to the other notice in writing, in which event this Agreement shall, subject as aftermentioned terminate on the expiry of a period of one (1) month from the date upon which such notice is received. Where the Vessel is not at a convenient port or place on the expiry of such period, this Agreement shall terminate on the subsequent arrival of the Vessel at a convenient port or place.

17.2
Termination by default - Owners

(i)
The Managers shall be entitled to terminate the Agreement with immediate effect by notice in writing if any moneys requested by the Managers from the Owners, shall not have been received in the Managers’ nominated account within fifteen (15) calendar days of payment having been requested in writing by the Managers or if the Owners fail to comply to the reasonable satisfaction of the Managers with the requirements of clauses 6.3, 6.4 and 6.5 or if the Vessel is repossessed by a mortgagee.

(ii)
If the Owners

(a)
otherwise fail materially to meet their obligations hereunder for reasons within their control, or

(b)
proceed with employment of or continue to employ the Vessel in the carriage of contraband, blockade running or in an unlawful and/or sanctionable trade, or on a voyage or in a manner which, in the opinion of the Managers, is unduly hazardous or improper, or potentially unlawful and/or sanctionable or

(c)
fail to comply with any recommendation of the Managers which the Managers consider to be reasonable and non-compliance with which may affect the Managers’ reputation or its obligations under the ISM Code or any other applicable laws or regulations
then the Managers may give written notice to the Owners specifying the default and requiring them to remedy it. In the event that the Owners fail to remedy such default (in the case of (a) above, if remediable) within a reasonable time to the reasonable satisfaction of the Managers, the Managers shall be entitled to terminate this Agreement with immediate effect by notice in writing.

17.3
Termination by Default - Managers
If the Managers fail materially to meet their obligations under this Agreement for reasons within the control of the Managers, the Owners may give written notice to the Managers specifying the default and requiring them to remedy it as soon as practically possible. In the event that the Managers fail to remedy such default within a reasonable period of time but in any case latest within fifteen (15) days from the date of the Owners’ notice, if remediable, to the reasonable satisfaction of the Owners, the Owners shall be entitled to terminate this Agreement with immediate effect by notice in writing.

17.4
Liquidation
The Parties to this Agreement shall be entitled to terminate this Agreement forthwith in the event of an order being made or resolution passed for the winding up, dissolution, liquidation or bankruptcy of the Owners of the Vessel (otherwise than for the purpose of reconstruction or amalgamation) or the Managers or if a receiver or similar officer is appointed to the Owners or the Managers or if either Party ceases to carry on business or make any special arrangement or composition with their creditors or if the Owners suspend payment under this Agreement.
 
Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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:          01-2020

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17.5
Extraordinary Termination
This Agreement shall be deemed to be terminated in the case of the sale of the Vessel or its being bareboat chartered, if applicable and unless otherwise agreed, when the bareboat charter comes to an end or if the Vessel becomes a total loss or is declared as a constructive or compromised or arranged total loss or is requisitioned.  Notwithstanding such deemed termination, fees shall be paid in accordance with the provisions of Clause 8.6.
17.6
For the purpose of sub-clause 17.5 hereof:

(i)
the date upon which the Vessel is to be treated as having been sold or otherwise disposed of shall be the date on which the registered owners cease to be registered as owners of the Vessel;

(ii)
the Vessel shall not be deemed to be lost until either she has become an actual total loss or agreement has been reached with her Underwriters in respect of her constructive, compromised or arranged total loss or if such agreement with her underwriters is not reached it is adjudged by a competent tribunal that a constructive loss of the Vessel has occurred or a Notice of Abandonment is issued to underwriters.
17.7
The termination of this Agreement shall be without prejudice to all rights accrued due between the parties prior to the date of termination.
17.8
All outstanding fees and other sums payable by the Owners require to be paid in full on or prior to termination, for whatever reason, of this Agreement. Save where the Agreement is terminated by the Owners in accordance with Clause 17.3, the Managers shall be paid fees in accordance with Clause 8.6. The Owners shall also pay on demand Severance Costs together with repatriation costs and expenses.

18.
Confidentiality
18.1
As between the Owners and the Managers, the Owners hereby agree and acknowledge that all title and property in and to the management manuals of the Managers and other written material of the Managers concerning management functions and activities is vested in the Managers and the Owners agree not to disclose the same to any third party and, on the termination of this Agreement, to return all such manuals and other material to the Managers. For the purposes of this Clause reference to “the Managers” includes the parent, subsidiary and associated companies of the Managers and any third parties providing Management Services.
19. Suspension of Services
 
If, at any time, the Owners have failed to pay the sums due and owing, as set out in Clause 9, or are in breach of any other terms of this Agreement, in addition to the Managers’ rights pursuant to Clause 17 to terminate, the Managers shall, without prejudice to their liberty to terminate, be entitled to withhold/suspend the performance of any and all of their obligations hereunder (including, but not limited to, removal of Crew) and shall have no responsibility whatsoever for any consequences thereof, in respect of which the Owners hereby indemnify the Managers, and fees (as set out in the Fee Schedule) shall continue to accrue and any extra expenses resulting from such withholding shall be for the Owners’ account.

20.
Law and Arbitration
20.1
This Agreement shall be governed by English law and any dispute arising out of or in connection with this Agreement shall be referred to arbitration in London in accordance with the Arbitration Act 1996 and any amendment thereto or substitution therefor.
20.2
The arbitration shall be conducted in accordance with the London Maritime Arbitrators’ (LMAA) Terms current at the time when the arbitration is commenced.
20.3
Save as aftermentioned, the reference shall be to three arbitrators, one to be appointed by each party and the third by the two so appointed. A party wishing to refer a dispute to arbitration shall appoint its arbitrator and send notice of such appointment to the other party requiring the other party to appoint its arbitrator within fourteen (14) days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints its own arbitrator and give notice that it has done so within the fourteen (14) days specified. If the other party does not appoint its own arbitrator and give notice that it has done so within the fourteen (14) days specified, the party referring the dispute to arbitration may, without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise the other party accordingly. The award of a sole arbitrator shall be as binding as if he had been appointed by agreement.
20.4
In cases where neither the claim nor any counterclaim exceeds the sum of US$50,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the LMAA Small Claims Procedure current at the time when the arbitration proceedings are commenced.
 
Ship Technical Management Agreement
OWNERS
MANAGERS
  
V.SHIPS SHIP MANAGEMENT AGREEMENT
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:          01-2020

Page Number
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20.5
Unless otherwise provided for in a separate agreement, the Owners hereby agree that any claim by any company providing services under clause 24 below shall, unless such company elects otherwise, be subject to English law and any dispute shall be referred to arbitration in accordance with the foregoing provisions of this clause 20.
20.6
Except to the extent provided for in clauses 10, 11 and 20.5 no third party shall have the right to enforce any term of this Agreement.

21.
Amendments to Agreement
21.1
Any and all amendments will be agreed by all the parties in the Agreement and will be in writing.
21.2
It is hereby understood that upon the written request of the Owners, certain Management Services will cease to be performed by the Managers and the Management Fee will be reduced accordingly. An amendment reflecting this will be entered into between the Managers and the Owners.

22.
Time Limit for Claims
Any and all liabilities of either party to the other arising under this Agreement or otherwise in relation to the Vessel (except in the case of fraud) shall be deemed to be waived and absolutely barred on the relevant date unless prior to the relevant date written particulars of any claim (giving details of the alleged breach in respect of which such claim is made and a preliminary statement of the amount claimed) have been intimated in writing by the claimant by the relevant date, and any such claim shall be deemed (if it has not previously been satisfied, settled or withdrawn) to have been withdrawn unless arbitration proceedings have been commenced under Clause 20 prior to the expiry of six (6) months after the relevant date. For the purposes of this Clause 22, the “relevant date” is one year after the date of termination, for whatever reason, of this Agreement.

23.
Condition of Vessel
The Owners acknowledge that they are aware that the Managers are unable to confirm that the Vessel, its systems, equipment and machinery are free from defects, and agree that the Managers shall not in any circumstances be liable for any losses, costs, claims, liabilities and expenses which the Owners may suffer or incur resulting from pre-existing or latent deficiencies in the Vessel, its systems, equipment and machinery.
24.
Use of Associated Companies
24.1
The Managers hereby disclose to the Owners that they may, in the course of performing Management Services, utilize the services of companies associated with the Managers. Without prejudice to the foregoing generality, associated companies of the Managers may be used in connection with inter alia travel, insurance, port agency catering and consultancy services. Where companies associated with the Managers provide services in connection with the above or any other matters, such companies will be entitled to charge and retain for their own benefit usual remuneration for the provision of their services (whether in the form of commission or fees). The Managers will send a list of the Associated Companies to Owners on or prior to the Date of Commencement.
24.2
The Owners hereby consent to the arrangements set out in Clause 24.1.

25.
Notices
25.1
Any notice or other communication under or in relation to this Agreement (a “Communication”) may be sent by fax, registered or recorded mail, by personal delivery.
25.2
The addresses of the parties for service of a Communication shall be as stated in Boxes 5 and 6 respectively of Part I.
25.3
A Communication shall be deemed to have been delivered and shall take effect:

(i)
in the case of a fax on the day of transmission; and

(iii)
if delivered personally or sent by registered or recorded mail at the time of delivery.

26.
Staff Loyalty
The Owners shall not and shall procure that their parent, subsidiary and associate companies shall not, without the written consent of the Managers, during the course of this Agreement or for a period of six (6) months following termination directly or indirectly offer any employment to any employee of the Managers engaged in providing Management Services or directly or indirectly induce or solicit any such person to take up employment with the Owners or any associated or affiliated company or use the services of any such person either independently or via a third party. In the event that the Managers agree to any of its employees accepting an offer of employment as aforesaid, the Owners shall pay to the Managers a sum equivalent to 25% of the new annual salary of that employee, payable within seven days of the date of the written agreement of the Managers. Such payment shall be construed as liquidated damages and not as a penalty, being the parties agreed reasonable estimate of the Managers’ loss. This clause will not apply to any staff recruited or seconded specifically from Seanergy for the Seanergy vessels.
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27.
Entire Agreement
27.1
This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter of this Agreement and (in relation to such subject matter) supersedes all prior discussions, understandings and agreements between the parties and all prior representations and expressions of opinion by the parties.
27.2
Each of the parties acknowledges that it is not relying on any statements, warranties, representations or understandings (whether negligently or innocently made) given or made by or on behalf of the other in relation to the subject matter hereof and that it shall have no rights or remedies with respect to such subject matter otherwise than under this Agreement. The only remedy available shall be for breach of contract under the terms of this Agreement. Nothing in this clause shall, however, operate to limit or exclude any liability for fraud.

28.
Partial Validity
If any provision of this Agreement is or becomes or is held by any arbitrator or other competent body to be illegal, invalid or unenforceable in any respect under any law or jurisdiction, the provision shall be deemed to be amended to the extent necessary to avoid such illegality, invalidity or unenforceability, or, if such amendment is not possible, the provision shall be deemed to be deleted from this Agreement to the extent of such illegality, invalidity or unenforceability and the remaining provisions shall continue in full force and effect and shall not in any way be affected or impaired thereby.
 
29.
Non Waiver
No failure to exercise nor any delay in exercising any right, power, privilege or remedy under this Agreement shall in any way impair or affect the exercise thereof or operate as a waiver in whole or in part. No single or partial exercise of any right, power, privilege or remedy under this Agreement shall prevent any further or other exercise thereof or the exercise of any other right, power, privilege or remedy.
 
 
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V.SHIPS SHIP MANAGEMENT AGREEMENT
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SHIP TECHNICAL MANAGEMENT AGREEMENT - PART III

ASSOCIATED COMPANIES

1. Travel Management on a 24hour basis: (Global Marine Travel & Everyway Travel)

Services include controls for verifying quotes, integrated billing system, consultancy, cost control and account management, visa assistance, corporate travel.

2. Catering (OCL Oceanic Catering Limited)

Services include cargo ship, offshore, remote site, ferry and cruise catering, consulting for start-up, new building, and operational review, purchasing and logistics.

3. Training (Marlins – Seatec UK Ltd)

English language testing and computer-based training.

4. Condition monitoring (Seatec condition monitoring)

Routine Lube Oil & Fuel Oil analysis, annual thermal & vibration surveys, fluid analysis as required: Fuel Purifier, Cylinder Scrapedown, OWS and drinking water (as per MLC requirements).

5. Technical analysis of vessel performance (V Ships Ship Management (India) Pvt Ltd)

Services include the monitoring of vessel performance by collecting and analysing the main parameters affecting fuel consumption: main engine (ME) consumption, condition of hull and propeller, sludge production and itinerary management in terms of speed and rpm.
The above findings are compiled in monthly reports containing trends and comparisons to optimum performance and to sister/similar vessels, if any, with the purpose of improvement in speed and consumption, cleaning of hull/propeller, operation of vessel within charterparty limits and provision of documents in support of commercial claims.
The service is tailor-made to suit the existing recording equipment available onboard and will include suggestions for improvement fully supported by ROI analysis
The technical performance of the ME is analysed in terms of ME load balance, fuel injection pump, air cooler, Turbo Charge and Economiser conditions with the purpose of improvement in fuel and lube oil consumption and the streamlining spare parts procurement.

6. Safety services (Seatec  Safety Operations )

Safety inspections, pre-vetting, navigational and internal ISM/ISPS audits and on-board training provided world-wide. Ship security plans and Ship security assessments.

7. Radio & Communications (Seatec Communication)

Provision of satellite communications (FBB, VSAT, etc.) Bespoke solutions depending on vessel operational requirements.  Seatec Communication will endeavour to take over existing satellite communication contract at no extra cost to Owners with the purpose of being able to provide consistent, standardised and high quality services across the fleet.

Supply of electronic charts, GDMSS services, Inmarsat PSA and LRIT, crew prepaid cards, entertainment content to crew.

8. Underwater services (Seatek UK Ltd.)

Routine underwater inspections, propeller and hull cleaning. Underwater repair and maintenance as required.

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9. Engineering services and consultancy (Seatec UK Ltd)

Services include naval architecture, engineering, design, emergency response services, laser scanning, new construction supervision and project management services.

10. Navigation (Seatec Communications)

Supply, installation and maintenance of communication and navigation equipment including radars, ECDIS, autopilots.

11. Repairs and Installations (Seatec Repairs)

Provision of riding gangs, turnkey repairs and installations, engine overhauling, electrical installations, annual services and NDT testing.

13.OTHER SERVICES











 
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APPENDIX 5 - On Board Safety Audit and Safety Training (only applicable if not deleted – at no extra cost)

1.
The Managers shall arrange on board safety audit and training which will include the following functions:


(i)
preparation and updating of specialist safety manuals not already included in the SMS;


(ii)
periodic on board safety audit and on board safety training;
 
(iii)
reporting to the Vessel (via the Managers) on information gained from visits to other vessels and industry forums.

2.
The cost of the foregoing services shall be such sum as is set out in the Fee Schedule and shall be included in the budget agreed with the Owners.

3.
The Managers have entered into sub-contracts with third parties to permit them to supply this service.

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SHIP TECHNICAL MANAGEMENT AGREEMENT – PART IV

FEE SCHEDULE

SHIP NAME:  EXELIXSEA

 
BASIC SERVICES (Clause 3 of Part II)

Amount
Frequency
  
               
 
Management Fee
    
As per agreed budget
  
Monthly in advance
  
 
Information System fees (Shipsure)
    
As per agreed budget
  
Per year
  
 
Planned maintenance - data base development fee (maximum of 30 chargeable days)
    
As per agreed budget
  
30 days of invoice
  
 
Crewing: Fixed Cost invoice – Crewing Costs (Part VI)
    
As per agreed budget
  
Monthly
  
               
 
Other Crew costs (ITF, SEPF, PNO fee etc.)
        
Monthly
  
               
 
Management Expenses:
         Monthly  

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SHIP TECHNICAL MANAGEMENT AGREEMENT - PART V

FLEET DETAILS

Per Part I, “1. Vessel Details”.

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SHIP TECHNICAL MANAGEMENT AGREEMENT - PART VI

INITIAL BUDGET

 As attached.
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Crew Complement

As per agreed budget.

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2023 Budget (all figures in USD)


Ship Technical Management Agreement
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MANAGERS
  
EX-4.11 6 ef20039046_ex4-11.htm EXHIBIT 4.11
Exhibit 4.11
 

Addendum to Ship Management Agreement
 
THIS ADDENDUM, constituting an amendment to the Management Agreement (“Addendum”) is entered into on [____] between:
 
A.
[Name of Owner], with its registered address at [___] (“Owners”); and
 
B.
V.Ships Greece Ltd., with its registered office at 3rd Floor, Par la Ville Place, 14 Par la Ville Road, Hamilton, HM08, Bermuda (the “Managers”),
 
each a “Party” and together the “Parties”.
 
RECITALS:
 
(A)
A ship management agreement has been entered into between the Owners and the Managers in respect of the motor vessel [_____] with IMO Number: [_____] (the “Vessel”) dated [_____] (the “Management Agreement”).
 
(B)
New emission schemes relating to greenhouse gas emissions trading schemes (including but not limited to the European Union Emissions Trading System) are being included into law in various jurisdictions and the Parties wish to set out their obligations in facilitating compliance with such emission schemes.
 
(C)
The Parties also wish to agree on any additional management services that will be required to be provided by the Managers, on behalf of the Owners, to facilitate compliance with the applicable emission schemes.
 
(D)
The Parties agree to amend the Management Agreement as follows.
 
OPERATIVE PROVISIONS:
 
Condition Precedent
 
1.
This Addendum shall not come into force unless and until the Managers confirm in writing to the Owners that the Owners (or their nominee) have provided to the Managers the requisite Security set out herein (in form and substance acceptable to the Managers). Until such time as the Managers have provided such confirmation in writing to the Owners, the Owners remain the Responsible Entity and this Addendum shall not apply to the Management Agreement. Upon such written confirmation by the Managers, this Addendum shall come into force [_____].
 
2.
If at any point during the term of the Management Agreement, in accordance with this Addendum, Security is not in place (or, in the opinion of the Managers, is not acceptable), including, for the avoidance of doubt, any Adjustments to the Security, for whatever reason, and in case the Owners have not rectified and provided the agreed Security within 5 business days from a written notice from the Managers to the Owners, the Managers shall have the right to terminate this Addendum (and at the Managers discretion the Management Agreement) forthwith. In the event of such a termination, Owners shall or shall procure that they or any other party acceptable under the Emission Scheme be the Responsible Entity and assume all responsibility and liability, past, present and future howsoever arising with respect to any and all Emission Schemes.
 
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Management Agreement
 
1.
Except as hereby amended, all definitions, terms and conditions of the Management Agreement apply to this Addendum and remain in full force and effect.
 
2.
The Parties hereby agree as follows and the following words and expressions are hereby added to the Management Agreement:
 
The Parties agree to amend the Management Agreement as follows:
 
New Clause
 
“Emission Allowances” means an allowance, credit, quota, permit or equivalent, representing a right of a Vessel to emit a specified quantity of greenhouse gas emissions recognised by the Emission Scheme.

“Emission Data” means data and records of the Vessel’s emissions in the form and manner necessary to calculate its Emission Allowances.

“Emission Scheme” means a greenhouse gas emissions trading scheme which for the purposes of this Clause shall include the European Union Emissions Trading System and any other similar systems imposed by applicable lawful authorities that regulate the issuance, allocation, trading or surrendering of Emission Allowances.

“Responsible Entity” means the party responsible for compliance under the Emissions Scheme(s) applicable to the Vessel by law, regulation and/or agreement.

Where the Managers are made the Responsible Entity under any Emission Scheme(s) applicable to the Vessel, or assume that responsibility by mandate from the registered owners or by agreement between the Parties in accordance with such Emission Scheme(s), the following shall apply:
 
Emission Data
 

 (a)
The Managers shall provide the Owners with Emission Data in a timely manner and in accordance with the Emission Scheme together with the calculation of the Emission Allowances required. Such Emission Data shall be verified by an accredited verifier as required under the Emission Scheme and if required by Owners audited by an independent party approved by them, at the Owners’ expense.
 

 (b)
Where the Owners require Emission Data in respect of a specific voyage, the Owners shall pay to the Managers a fee of USD 100 per voyage for such verified Emission Data, in any area subject to an Emission Scheme applicable to the Vessel, which shall include the fees of the accredited verifier.


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 (c)
The Managers shall monitor and report Emission Data to the administering authority, as well as submit the applicable Emission Allowances to the competent authority, in accordance with the Emission Scheme(s) applicable to the Vessel and subject to the provisions of this Addendum.
 
Emission Allowances
 

 (d)
The Managers have provided the Owners with a calculation of the Emission Allowances incurred by the Vessel prior to the date of this Addendum, together with an estimate of the Emission Allowances that the Vessel is expected to incur up to and including the following quarter of the Emission Scheme period (“Initial Period”). The Owners shall within ten business days of signing this Addendum provide the Managers (the Company or Managers’ nominee) with security in the form of either (i) a standby letter of credit substantially in the form set out in Schedule 1 hereto; or (ii) a parent company guarantee in a format acceptable to the Managers (limited to a maximum amount of 50% of the combined actual and estimated values of the Emission Allowances at any one time) and remittance to the Managers by the Owners (or their nominee) of a maximum of 50% of the estimated Emissions Allowances for the ensuing quarter in accordance with the provisions of this Addendum; or (iii) any other security in form and substance acceptable to the Managers, be it a standby letter of credit or otherwise (in either case, “Security”) in the full amount of the combined actual and estimated values of the Emission Allowances for the Initial Period at the then market price (as determined by the Trader) for purchase of the Emission Allowances, at the Owners’ option. The Owners (or their nominee) will also remit within twenty (20) running days the Emission Allowances incurred so far and up to the date of the Addendum.
 

 (e)
For each subsequent quarter of the then current period of the Emission Scheme, the Managers shall prepare and present in writing to the Owners: (i) any increases in Emission Allowances, compared to the estimated Emission Allowances, incurred by the Vessels in the previous quarter; (ii) the Managers estimate of the Emission Allowances for the ensuing quarter basis the Emission Allowances incurred for the Vessel during the previous quarter; and (iii) any increase in the market price of the Emission Allowances (all together the “Adjustment”). The Owners (or their nominee) shall provide the Managers (the Company or Managers’ nominee) with increased Security for the Adjustment by the 10th (tenth) business day of the last month within the previous quarter.
 

 (f)
On completion of the then current period of the Emission Scheme (“Completed Period”), upon which Emission Allowances are calculated and subsequently become due for surrender (as detailed within the relevant Emission Scheme), the Managers will continue to calculate the amount of Security required on a quarterly basis for the Completed Period and the Owners (or their nominee, as applicable) shall continue to provide additional Security as required until the Owners have provided the Managers (the Company or Managers’ nominee) with the full amount of the Emission Allowances required to fulfil the Managers (the Company or Managers’ nominee) obligations under the applicable Emission Scheme(s).
 

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 (g)
The requirements detailed in (d), (e) and (f) above shall be repeated for subsequent periods covered by Emission Schemes and the initial Security for the first quarter of the forthcoming Emission Scheme period shall be provided to the Managers by the 10th (tenth) business day of the month prior to the commencement of the forthcoming Emission Scheme period.
 

 (h)
In the event the Managers consider it necessary to draw down on or otherwise make a claim or demand under the Security, the Managers shall provide the Owners five business days’ written notice in advance.
 

 (i)
Thirty running days prior to termination of this Management Agreement, the Managers shall prepare and present to the Owners, in writing, their estimates of the Emission Allowances required to fulfil the Managers’ obligations under the applicable Emission Scheme(s) for the Vessel for the current period of the Emission Scheme(s) and any following period should termination not occur in the current period of the Emission Scheme(s) (where the Management Agreement is terminated in circumstances which do not allow thirty days’ notice the Managers shall notify the Owners of said Emission Allowances as soon as possible). Within ten running days of such notification, but not later than the termination of the Management Agreement, the Emission Allowances notified by the Managers shall be transferred by the Owners (or their nominee) to the Managers.
 

 (j)
Any difference between the Emission Allowances estimated according to subclause (i) above and the Emission Allowances actually due under the Emission Scheme(s) applicable to the Vessel, as at the time and date of termination of this Management Agreement and / or the time and date of the release of the Managers from their obligations under the Emission Scheme (whichever occurs latest), shall be reconciled and settled between the Parties within ten running days and following such reconciliation, the Managers (the Company or Managers’ nominee) shall release the Security to the Owners (or their nominee, as may be applicable).
 

 (k)
Notwithstanding the Managers agreeing to be the Responsible Entity, the Owners (or their nominee) are obliged to procure and transfer to the Managers the requisite Emission Allowances.


(l)
Emission Allowances are to be transferred to the Managers within ten business days after receipt by the Owners of the Managers’ written request. In the event that the Owners fail to procure and transfer to the Managers Emission Allowances in accordance with this Addendum, the Manager shall notify the Owners in writing to request rectification within five business days from a such written notice. In such case shall the Owners fail to procure and transfer the Emissions Allowance, the Managers are at liberty to purchase Emission Allowances for the final Emissions Allowances due to the competent authority. Any and all costs and expenses incurred by such purchase shall be for Owners’ account.


(m)
The Parties may agree to the Owners (or their nominee) providing the Managers (the Company or the Managers’ nominee) with the Emission Allowances as replacement for the Security, and when the Owners do so the Managers (the Company or Managers’ nominee) shall reduce the Security requirements in accordance with the value of the Emission Allowances received, as determined by the Trader.
 
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 (n)
The Managers shall surrender the Emission Allowances in accordance with the Emission Scheme(s) applicable to the Vessel, subject always to the Owners (or their nominee) providing such Emission Allowances to the Managers.
 

 (o)
Any Emission Allowances or other Security transferred by the Owners (or their nominee, as may be applicable) to the Managers under this Clause shall be held to the credit of the Owners until surrendered to the administering authority of the Emission Scheme(s) applicable to the Vessel or returned to the Owners.
 
Management Fees
 

 (p)
The management fees for providing the Owners with the services covered under this Addendum are as follows and shall be reviewed on an annual basis:
 
   
Management Fees Breakdown
  
 (USD)
1
  
Set-Up Costs
  
US$4,000 per MOHA
2
  
Liability Management Fee
  
US$5,000 for the Vessel per year
3
  
Emission Management Service Fee
  
US$550 per EU event per Vessel
(capped at US$10,000 annually)

      Additional costs & expenses (charged at cost to Owners)
   
Price Breakdown
  
Price
1
  
OceanScore Technology
  
Set-Up Price: 250 EUR for the Vessel
 
Annual Cost: 900 EUR for the Vessel
2
  
MOHA Maintenance Fee
  
$500 annually per MOHA (estimated)

With the exception of the MOHA Set-Up Costs and the MOHA Maintenance Fee, the fees, costs and expenses will not be applied until a Vessel commences trading in accordance with the Emission Scheme.
 

 (q)
All reasonable costs and expenses not itemised above, including, but not limited to, the purchase of Emission Allowances, incurred by the Managers in providing the services under this Addendum shall be reimbursed by the Owners at cost against presentation of vouchers / invoices. Owners must pay invoices issued in respect of fees, costs and expenses incurred under this Addendum within thirty running days and if not itemised above after their approval or in accordance with the Trader’s terms and conditions.
 
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Miscellaneous Provisions
 

 (r)
The Managers’ associated company MARCAS (see Clause 3.3 in the Management Agreement) has developed a strategic partnership with an Emission Allowances trader (“Trader”). The Trader can assist Owners in the opening of trading accounts and the purchasing of Emission Allowances and the procedures involved with the surrendering of the Emission Allowances.


(s)
The Owners accept that any Emission Allowances purchased by the Managers for the Owners is solely at the Owners risk and on the terms and conditions of the Trader, this also applies where the Managers purchase Emission Allowances for the Owners to comply with any Emission Scheme(s).
 

 (t)
All applicable charges in respect of any Security (including without limitation, opening, advising, confirmation, amendment and correspondent charges, charges) shall be for the Owners’ sole account.
 

 (u)
The issuance of any other Security shall not be construed as excluding Owners’ responsibility for making payment of amounts payable to the Managers under the Management Agreement or otherwise when due.
 

 (v)
Any Security shall take effect in accordance with its terms (including any agreed amendment(s) thereto) but such terms shall not alter, add to or in any way affect the provisions of this Management Agreement.


(w)
Any claim, drawing, or demand on any Security paid to the Managers shall be deemed to be a payment of the relevant amount by the Owners.

3.
The following Clause is added to Clause 3.3 – PURCHASING of the Management Agreements:
 
If requested by Owners for assistance, storage and purchase of Emission Allowances, MARCAS may receive an introductory fee from the Trader in consideration of its activities but does not have any authority or ability to negotiate or vary the terms applicable to the purchase of the Emission Allowances or bind the Trader.
 
4.
This Addendum shall be governed by and construed in accordance with English law and arbitration as provided in the Management Agreement.
 
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Agreed by the Parties as evidenced by their authorised signatories:
 
 
For and on behalf of [_____]
 
For and on behalf of V.Ships Greece Ltd.
       
 
Name:
  
Name:
 
Position:
  
Position:
 
Date:
  
Date:

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Schedule 1 – Form of Standby Letter of Credit
 
[Date]
 
[Beneficiary Name]
 
[Address]
 
[Attn: xxx]
 
Issuing Bank:  [Issuing Bank Name]
 
[Address of the Issuing Bank]
 
(SWIFT CODE: XXXXXXXX)
 
We hereby open in favour of (Beneficiary) by order of and for the account of our Applicant (Name of Applicant and address), our Irrevocable Standby Letter of Credit No._______ dated　_______ (the “Standby Letter of Credit”) up to the total aggregate amount not exceeding_________ (amount in words) (the “Standby Letter of Credit Amount”).
 
This Standby Letter of Credit is available with the Issuing Bank by payment upon presentation of the following documents:
 
In case that the Applicant failed to pay the amount due to the Beneficiary,
 
(1) Beneficiary’s signed statement evidencing the following:
 
“We certify that the amount of this drawing (US$ _______) under Standby Letter of Credit number __________ of __________ represents funds due to us as _______ has failed to pay the aforementioned amount, in full or in part, in accordance with the terms and conditions of the ship management agreements between Applicant and Beneficiary.”
 
This Standby Letter of Credit is effective from ______ and our obligations under this Standby Letter of Credit shall expire on _________ (the “Termination Date”) irrespective whether this Standby Letter of Credit is returned to us or not, at our counters, without affecting any liability that we have to you following receipt by us of any written demand from you on or prior to the Termination Date.
 
All costs and expenses incurred in or arising from the opening, amending and advising in respect of issuance of this Standby Letter of Credit shall be for the Applicant’s account.
 
The Beneficiary is entitled to make written demands for partial payments or drawings under this Standby Letter of Credit but aggregate amount shall not exceed the Standby Letter of Credit Amount. The amount available for drawing under this Standby Letter of Credit shall be automatically reduced by the amount of any payment(s) made by us in satisfaction of a demand in respect thereof.
 
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For reimbursement, upon compliance with the terms and conditions of this Standby Letter of Credit, we hereby undertake to effect payment in accordance with your instructions.
 
We hereby irrevocably agree that all documents drawn under and in compliance with the terms of this Standby Letter of Credit will be duly honoured by us at our counters mentioned in the above paragraphs, on or before the Termination date.
 
This Standby Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credits, 2007 Revision, International Chamber of Commerce Publication No.600, and as to matters not addressed by UCP shall be governed by English Law.
 
Duly authorised signatory,


(Issuing Bank)


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EX-4.12 7 ef20039046_ex4-12.htm EXHIBIT 4.12
Exhibit 4.12

On Demand Guarantee

Dated this this [__] day of [___], by

A.          United Maritime Corporation, with registered address at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960
(hereinafter “Guarantor”),

in favor of

B.          V.Ships Greece Ltd., with registered office at 3rd Floor, Par la Ville Place, 14 Par la Ville Road, Hamilton, HM08, Bermuda (hereinafter “V. Ships”).

WHEREAS, each of [___]  of [___] (each hereinafter referred to as the “Owner” and collectively the “Owners”), each being a wholly-owned subsidiary of the Guarantor, has entered into or is contemplating entering, under its capacity as disponent owner, a technical management agreement (dated [___] respectively and as novated and/or amended and/or supplemented from time to time) with V.Ships, under its capacity as technical manager, in relation to the M/Vs [___], respectively (hereinafter each referred to as the “Vessel” and collectively the “Vessels”), on the terms and conditions agreed therein (each such addendum, as the same may from time to time be modified, amended and supplemented, shall be referred hereinafter to as the “Management Agreement Addendum” and collectively the “Management Agreement Addenda”).

WHEREAS, each Management Agreement Addendum relates to the assumption by V.Ships of the relevant compliance obligations for each respective Vessel under any applicable Emission Scheme (as defined therein), while each Owner shall perform the obligations particularly mentioned therein.

WHEREAS, each Management Agreement Addendum provides that the parent company of each Owner shall provide a guarantee in favor of V.Ships as particularly described therein.

WHEREAS, this Guarantee is the guarantee mentioned under the Management Agreement Addenda.

NOW THEREFORE, in consideration of the foregoing, the Guarantor hereby covenants and agrees as follows:


 1.
Guarantee: The Guarantor hereby guarantees the maximum amount of 50% (fifty per cent) of the combined actual and estimated values of the Emission Allowances (as defined in each Management Agreement Addenda) for each Vessel at any time during the duration of the respective technical management agreement or the Management Agreement Addendum or after their termination as long as any Emission Allowances remain due from the Owners (or their nominee) to V.Ships under such respective technical management agreement or Management Agreement Addendum, as may be applicable.
 
1

 2.
Payment Demand and Terms of Payment: If any of the Owners (or its nominee, as may be applicable pursuant to the provisions of the respective Management Agreement Addendum) fails for whatever reason to remit the 50% (fifty per cent) of the required Emissions Allowances when due to V.Ships in accordance with the provisions of the respective Management Agreement Addendum, V.Ships shall notify the Guarantor in writing of the manner in which such Owner has failed to perform and demand that payment be made by the Guarantor under this Guarantee specifying the bank account V.Ships wish to receive payment ( “Payment Demand”).
 
The Guarantor shall within twenty (20) Greek business days after receipt of such Payment Demand, make payment in-full of the respective amount due to the bank account specified in the Payment Demand.
 

 3.
Waivers: This is an on demand, unconditional and irrevocable Guarantee and not merely a surety. Therefore, the Guarantor hereby waives (a) any right to assert any counterclaim or other defenses before payment and to exercise any right to set-off; (b) any right to require that any action or proceeding be brought against each of the Owners or any other person in advance of payment.
 
No delay of V.Ships in the exercise of or failure to exercise any right hereunder shall operate as a waiver of such rights, a waiver of any other rights or a release of the Guarantor from any obligations hereunder.
 

 4.
Termination: This Guarantee shall terminate in relation to each Owner on the date that the obligations of that Owner to make payment of all Emissions Allowances under the Management Agreement Addendum is fulfilled, regardless of a termination of the respective technical management agreement or the respective Management Agreement Addendum for the relevant Vessel.


5.
Representations and warranties: The Guarantor represents and warrants that:
(a) it is an entity duly organised and validly existing under the laws of the jurisdiction of its incorporation and has the corporate power and authority to execute, deliver and carry out the terms and provisions of this Guarantee;
(b) no authorisation, approval, consent or order of, or registration or filing with, any court or other governmental body having jurisdiction over the Guarantor is required on the part of the Guarantor for execution and delivery of this Guarantee; and
(c) this Guarantee, when executed and delivered, will constitute a valid and legally binding agreement of the Guarantor.


6.
Miscellaneous: This Guarantee shall be binding upon the Guarantor, its successors and assigns and inure to the benefit of and be enforceable by V.Ships, its successors and assigns.


This Guarantee shall be governed by and interpreted in accordance with English law and shall be refeed to arbitration in London in accordance with the Arbitration Act 1966 and any amendment thereto or substitution therefor. More specific provisions in relation to the arbitration proceedings as described in the respective technical management Agreement for the relevant Vessel, shall apply mutatis mutandis for this Guarantee.
 
2
No term or provision of this Guarantee, included this provision, shall be amended, modified, altered, waived or supplemented except in writing duly signed by the Guarantor and V.Ships.


  
For and on behalf of the
  
For and on behalf of the
Guarantor
  
V. Ships Greece Ltd.
Name:
  
Name:
Title:
  
Title:


3
EX-4.32 8 ef20039046_ex4-32.htm EXHIBIT 4.32
Exhibit 4.32

PART II
BARECON 2001 Standard Bareboat Charter

  1.
Shipbroker
EPknoT Co., Ltd.
Fearnley Securities AS
2.
Place and date
24th July 2024
  3.
Owners/Place of business (Cl.1)
Onishi Kaiun Co., Ltd. (99% ownership)
1-13-4, Katsuyamacho, Matsuyama-shi, Ehime, Japan
 
Ocean West Shipping S.A. (1% ownership)
80 Broad Str, Monrovia, Republic of Liberia
 
c/o Onishi Kaiun Co., Ltd.
Email:

4.
Bareboat Charterers / Place of business (Cl.1)
Synthesea Maritime Co.
80 Broad Str, Monrovia, Republic of Liberia
 
(guaranteed by United Maritime Corporation, of the Republic of the Marshall Islands)
 
c/o 154 Vouliagmenis Avenue,
16674 Glyfada, Greece
Email:
  5.
Vessel’s name, call sign and flag (Cl. 1 and 3)
MV Ikan Kerapu tbr Synthesea
Call Sign: 5LMI4 (upon delivery)
Flag: Liberia (upon delivery)
  6.
Type of Vessel
 Bulk carrier

7.
GT/NT
41,753/26,057 tons
  8.
When / Where built
2015
Sasebo Heavy Industries Co., Ltd.

9.
Total DWT (abt.) in metric tons on summer freeboard
78,020 tons
  10.
Classification Society (Cl.3)
RINA or other IACS

11.
Date of last special survey by the Vessel’s classification  society
1st February 2020
  12.
Further particulars of Vessel (also indicate minimum number of months’ validity of class certificates agreed acc. to (Cl.3)
  13.
Port or Place of delivery (Cl.3)
Safely afloat at an accessible safe berth or anchorage at a safe port or at sea within World Wide Range at the Charterer’s option.
14.
Time for delivery (Cl. 4)
1 July 2024 – 9 August 2024 in Charterer’s option
15.
Cancelling date (Cl.5)
9 August 2024
  16.
Port or Place of redelivery (Cl.15)
Safely afloat at an accessible safe berth or anchorage at a safe
port or place worldwide, in Charterers’ option
17.
No. of months’ validity of trading and class certificates
upon redelivery (Cl. 15)
minimum 3 months
  18.
Running days’ notice if other than stated in Cl.4
N/A
19.
Frequency of dry-docking (Cl. 10(g))
As required by the Classification Society
  20.
Trading limits (Cl. 6)
World Wide trading within Institute Warranty Limits (IWL). Charterers may breach IWL against paying all additional premium/expenses. North Korea and States sanctioned by UN, USA, EU, Japan, or UK to be excluded in case sanctions apply to Charterers and/or Vessel and prohibit trading, and Owners to be informed by Charterers. Failure to provide such notifications shall not constitute a breach of this Charter, but if such calling constitutes a breach of UN, USA, EU, Japan, or UK sanctions, then Charterers to undertake to indemnify Owners against all direct losses and costs sustained as a result of such violation.
  21.
Charter period
5 years from delivery
See also Addendum No. 1
 
 
22.
Charter hire (Cl. 11)
See also Clause 45
 
Fixed part: USD136,364 per month; plus
Floating part: (3M CME TERM SOFR + 2.70%) x Loan Outstanding x Number of Days / 360

Loan Outstanding as per Clause 45.
If 3M CME TERM SOFR falls below zero, then 3M CME TERM SOFR equal to zero to be applied to calculate the
Floating Part of the Charter Hire.
  23.
New class and other safety requirements (state percentage of Vessel’s insurance value acc. to Box 29) (Cl.10 (a)(ii))
N/A
  24.
Rate of interest payable acc. to Cl. 11 (f) and, if applicable, acc.
to PART IV
3 month CME TERM SOFR plus 2.70 (two point seventy) percentage points per
annum
25.
Currency and method of payment (Cl. 11)
USD, payable monthly in advance by bank transfer
(Floating part of the Charter Hire to be determined no later than 5 Banking Days before hire due date)

Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter
  26.
Place of payment; also state beneficiary and bank account (Cl. 11)
THE EHIME BANK, LTD.
Address: 2-1, Katsuyama-cho, Matsuyama-city, Ehime, Japan
Dollar Ordinary a / c no:
Account Name:
Swift Code:


27.
Bank guarantee / bond (sum and place) (Cl. 24) (optional)
N/A
  28.
Mortgage(s), if any (state whether 12 (a) or (b) applies; if 12 (b)
applies state date of Financial Instrument and name of
Mortgage(s) / Place of business) (Cl.12)
First priority ship mortgage in favor of THE EHIME BANK, LTD.
Address: 2-1, Katsuyama-cho, Matsuyama-city, Ehime, Japan
29.
Insurance (hull and machinery and war risks) (state value
acc. to Cl. 13(f) or, if applicable, acc. to Cl. 14(k)) (also
state if Cl. 14 applies)
See Clause 42
  30.
Additional insurance cover, if any, for Owners’ account limited to (Cl. 13 (b) or, if applicable, Cl. 14(g))
N/A
31.
Additional insurance cover, if any, for Charterers’ account limited to (Cl. 13 (b) or, if applicable, Cl. 14(g))
N/A
  32.
 Latent defects (only to be filled in if period other than stated in
Cl. 3)
N/A
33.
Brokerage commission and to whom payable (Cl. 27)
N/A
  34.
Grace period (state number of clear banking days) (Cl.28)
Five (5) Banking days
35.
Dispute Resolution (state 30 (a), 30(b) or 30(c); if 30(c) agreed Place of Arbitration must be stated (Cl. 30)
(a) English law, London arbitration
  36.
War cancellation (indicate countries agreed) (Cl.26 (f))
N/A
  37.
 Newbuilding Vessel (indicate with “yes” or “no” whether PART
III applies) (optional)
No
38.
Name and place of Builders (only to be filled in if PART III applies)
N/A
  39.
Vessel’s Yard Building No. (only to be filled in if PART III applies)
N/A
40.
Date of Building Contract (only to be filled in if PART III applies)
N/A
  41.
 Liquidated damages and costs shall accrue to (state party acc. to Cl. 1
a)
b)
c)
  42.
Hire / Purchase agreement (indicate with “yes” or “no” whether PART IV applies) (optional)
N/A
43.
Bareboat Charter Registry (indicate with “yes” or “no” whether PART V applies) (optional)
Yes, in Charterers' option
  44.
Flag and Country of the Bareboat Charter Registry (only to be filled in if PART V applies) (optional)
Liberia
45.
Country of the Underlying Registry (only to be filled in if PART V applies)
Liberia
  46.
Number of additional clauses covering special provisions, if agreed
See Clause 32-49
 
PREAMBLE - It is mutually agreed that this Contract shall be performed subject to the conditions contained in this Charter which shall include PART I and PART II and Rider Clauses 32 to 49. In the event of a conflict of conditions, the provisions of PART I shall prevail over those of PART II to the extent of such conflict but no further. It is further mutually agreed that PART III and/or PART IV and/or PART V shall only apply and only form part of this Charter if expressly agreed and stated in Boxes 37, 42 and 43. If PART III and/or PART IV and/or PART V apply, it is further agreed that in the event of a conflict of conditions, the provisions of PART I and PART II shall prevail over those of PART III and/or PART IV and/or PART V to the extent of such conflict but no further.
 
Onishi Kaiun Co., Ltd. & Synthesea Maritime Co.
Signature (Owners)
Signature (Charterers)


/s/ Shotaro Onishi
/s/ Stavros Gyftakis


Shotaro Onishi Stavros Gyftakis
Director Director/ Treasurer
 
OCEAN WEST SHIPPING S.A.
Signature (Owners)


/s/ Shotaro Onishi


Shotaro Onishi
  
Director/Secretary  
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 1
1. Definitions

2
In this Charter, the following terms shall have the

3
meanings hereby assigned to them:

4
“The Owners” shall mean the party identified in Box 3;

5
“The Charterers” shall mean the party identified in Box 4;

6
“The Vessel” shall mean the vessel named in Box 5 and

7
with particulars as stated in Boxes 6 to 12.

8
“Financial Instrument” means the mortgage, deed of

9
covenant or other such financial security instrument as

10
annexed to this Charter and stated in Box 28.
"MOA" means the Memorandum of Agreement entered into between the Owners as buyers and the Charterers as sellers dated 24th July, 2024.

11
"Banking Days" means a day on which banks are open for transaction of business of the nature required by this Charter in Liberia, Tokyo, Piraeus, London and New York.

12
2. Charter Period See also Addendum No. 1

13
In consideration of the hire detailed in Box 22,

14
the Owners have agreed to let and the Charterers have

15
agreed to hire the Vessel for the period stated in Box 21

16
(“The Charter Period”).


17
3. Delivery See also clauses 33, 34 and 35.

18

19

20

21

22

23
The Vessel shall be delivered by the Owners and taken

24
over by the Charterers at the port/berth/anchorage or place indicated in

25
Box 13

26

27

28

29

30

31

32

33


34
(c) The delivery of the Vessel by the Owners and the

35
taking over of the Vessel by the Charterers shall

36
constitute a full performance by the Owners of all the

37
Owners’ obligations under this Clause 3, and thereafter

38
the Charterers shall not be entitled to make or assert

39
any claim against the Owners on account of any

40
conditions, representations or warranties expressed or

41
implied with respect to the Vessel.

42

43

44

45

46

47
4. Time for Delivery See clause 33

 48

49

50

51

52

53

54

55

56

57

58

59


60
5. Cancelling See clause 33

61

62

63

64

65

66

67

68


69

70

71

72

73

74

75

76

77

78

79

80

81

82


83

84

85


86
6. Trading Restrictions

87
The Vessel shall be employed in lawful trades for the

88
carriage of suitable lawful merchandise within the trading

89
limits indicated in Box 20.

90
The Charterers undertake not to employ the Vessel or

91
suffer the Vessel to be employed otherwise than in

92
conformity with the terms of the contracts of insurance

93
(including any warranties expressed or implied therein)

94
without first obtaining the consent of the insurers to such

95
employment and complying with such requirements as

96
to extra premium or otherwise as the insurers may

97
prescribe.

98
The Charterers also undertake not to employ the Vessel

99
or suffer her employment in any trade or business which

100
is forbidden by the law of any country to which the Vessel

101
may sail or is otherwise illicit or in carrying illicit or

102
prohibited goods or in any manner whatsoever which

103
may render her liable to condemnation, destruction,

104
seizure or confiscation.

105
Notwithstanding any other provisions contained in this

106
Charter it is agreed that nuclear fuels or radioactive

107
products or waste are specifically excluded from the

108
cargo permitted to be loaded or carried under this
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 109
Charter. This exclusion does not apply to radio-isotopes

110
used or intended to be used for any industrial,

111
commercial, agricultural, medical or scientific purposes

112
provided the Owners’ prior approval has been obtained

113
to loading thereof.
 

 114
7. Surveys on Delivery and Redelivery See clauses 36 and 37

115
(not applicable when Part III applies, as indicated in Box 37)

116

117

118

119

120

121

122

123
Not earlier than 45 days nor later than 30 days or if not possible then as soon as the Vessel becomes available before re-delivery of the Vessel, the Owners and the Charterers shall jointly agree upon the appointment of an independent surveyor for the purpose of determining in writing the condition of the Vessel at the time of redelivery hereunder. The surveyor, whose decision shall be final and binding on both parties, shall report in writing, specifying all items, if any, which have not been properly maintained in accordance with the terms and conditions of the Charter and the work required to correct such deficiencies. The costs of such a surveyor shall be equally shared between the parties. In the event that the parties are not able to agree upon a single surveyor, each shall appoint their own and the two surveyors so appointed shall conduct a joint survey of the Vessel. In such event, each party shall pay their own appointed surveyor's costs. The survey shall be carried out at the port of redelivery and in Charterer's time. Any works required as a result of such survey shall be carried by the Charterer prior to their redelivering of the Vessel. 8. Inspection

 124
The Owners shall, once a year, have the right after giving

125
reasonable notice to the Charterers to inspect or survey

126
the Vessel or instruct a duly authorised surveyor to carry

127
out such survey on their behalf provided it does not interfere with the operation and trading of the Vessel and/or crew:-
 

 128
(a) to ascertain the condition of the Vessel and satisfy

129
themselves that the Vessel is being properly repaired

130
and maintained. The costs and fees for such inspection

131
or survey shall be paid by the Owners unless the Vessel

132
is found to require repairs or maintenance in order to
 
133
achieve the condition so provided;


134
(b) in dry-dock if the Charterers have not dry-docked

135
Her in accordance with Clause 10(g). The costs and fees

136
for such inspection or survey shall be paid by the

137
Charterers; and
 

 138

139

140

141

142
 

 143
All time used in respect of inspection, survey or repairs

144
shall be for the Charterers’ account and form part of the

145
Charter Period.

146
The Charterers shall also permit the Owners to inspect

147
the Vessel’s log books whenever reasonably requested and shall

148
whenever required by the Owners furnish them with full

149
information regarding any casualties or other accidents

150
or damage to the Vessel.
 

 151
9. Inventories, Oil and Stores

152

153

154

155

156

157

158

159

160

161

162

163

164

165

166
 

 167
10. Maintenance and Operation

168
(a)(i) Maintenance and Repairs - During the Charter

169
Period the Vessel shall be in the full possession

170
and at the absolute disposal for all purposes of the

171
Charterers and under their complete control in

172
every respect. The Charterers shall maintain the

173
Vessel, her machinery, boilers, appurtenances and

174
spare parts in a good state of repair, in efficient

175
operating condition and in accordance with good

176
commercial maintenance practice and,

177
, at their

178
own expense they shall at all times keep the

179
Vessel’s Class fully up to date with the Classification

180
Society indicated in Box 10 and maintain all other

181
necessary certificates in force at all times.
 

 182
(ii) New Class and Other Safety Requirements - In the

183
event of any improvement, structural changes or

184
new equipment becoming necessary for the

185
continued operation of the Vessel by reason of new

186
class requirements or by compulsory legislation
including but not limited to Ballast Water Treatment System or scrubber, the cost and time of compliance shall be for the Charterers account. Notwithstanding the foregoing, Charterers are allowed to make improvements to the Vessel provided cost of same to be for the Charterers account.

 
 




 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 187

188

189

190

191

192

193

194

195

196

197

198

199
 

 200
(iii) Financial Security - The Charterers shall maintain

201
financial security or responsibility in respect of third

202
party liabilities as required by any government,

203
including federal, state or municipal or other division

204
or authority thereof, to enable the Vessel, without

205
penalty or charge, lawfully to enter, remain at, or

206
leave any port, place, territorial or contiguous

207
waters of any country, state or municipality in

208
performance of this Charter without any delay. This

209
obligation shall apply whether or not such

210
requirements have been lawfully imposed by such

211
government or division or authority thereof.

212
The Charterers shall make and maintain all arrange-

213
ments by bond or otherwise as may be necessary to

214
satisfy such requirements at the Charterers’ sole

215
expense and the Charterers shall indemnify the Owners

216
against all consequences whatsoever (including loss of

217
time) for any failure or inability to do so.
 

 218
(b) Operation of the Vessel - The Charterers shall at

219
their own expense and by their own procurement man,

220
victual, navigate, operate, supply, fuel and, whenever

221
required, repair the Vessel during the Charter Period

222
and they shall pay all charges and expenses of every

223
kind and nature whatsoever incidental to their use and

224
operation of the Vessel under this Charter, including

225
annual flag State fees and any foreign general

226
municipality and/or state taxes. The Master, officers

227
and crew of the Vessel shall be the servants of the Charterers

228
for all purposes whatsoever, even if for any reason

229
appointed by the Owners.

230
Charterers shall comply with the regulations regarding

231
officers and crew in force in the country of the Vessel’s

232
flag or any other applicable law.
 

 233
(c) The Charterers shall keep the Owners and the

234
mortgagee(s) advised of the intended employment,

235
planned dry-docking and major repairs of the Vessel,

236
as reasonably required.
 

 237
(d) Flag and Name of Vessel – The Owners have no rights to change the name and the flag of the Vessel during the Charter Period. During the Charter Period, the Charterers shall have the liberty to paint the Vessel in their own colours, install and display their

238
funnel insignia and fly their own house flag. The

239
Charterers shall also have the liberty, with the Owners’

240
consent, which shall not be unreasonably withheld or delayed, to

241
change the flag and/or the name of the Vessel and/or Class (to be a member of IACS) during
 


242
the Charter Period and such expense and all costs and expense incurred by the Owners in relation to flag changes (including but not limited to documentation fee in relation to the Financial Documents and deletion of the existing registration of the ownership and mortgage of the Vessel and the new registration of ownership and mortgage over the Vessel) shall be for Charterer’s account.

243

244

245
Tonnage tax charged on the basis of tonnage by the Vessel's flag state during the Charter Period for current and any new flag to be for Charterers' account.
 

 246
(e) Changes to the Vessel – Subject to Clause 10(a)(ii),

247
the Charterers shall make no structural changes in the

248
Vessel or changes in the machinery, boilers, appurten-

249
ances or spare parts thereof without in each instance

250
first securing the Owners’ approval thereof. Notwithstanding the above, Owners' consent will not be required for any changes (including structural changes) to the vessel related to the installation of the ammonia (propulsion) system on the Vessel. 

251

252

253
.
 

 254
(f) Use of the Vessel’s Outfit, Equipment and

255
Appliances - The Charterers shall have the use of all

256
outfit, equipment, and appliances on board the Vessel

257
at the time of delivery, provided the same or their

258
substantial equivalent shall be returned to the Owners

259
on redelivery in the same condition as

260
when received, ordinary wear and tear excepted. The

261
Charterers shall from time to time during the Charter

262
Period replace such items of equipment as shall be so

263
damaged or worn as to be unfit for use. The Charterers

264
are to procure that all repairs to or replacement of any

265
damaged, worn or lost parts or equipment be effected

266
in such manner (both as regards workmanship and

267
quality of materials) as not to diminish the value of the

268
Vessel. The Charterers have the right to fit additional

269
equipment at their expense and risk but the Charterers

270
shall remove such equipment at the end of the period if

271
requested by the Owners. Any equipment including radio

272
equipment on hire on the Vessel at time of delivery shall

273
be kept and maintained by the Charterers and the

274
Charterers shall assume the obligations and liabilities

275
of the Owners under any lease contracts in connection

276
therewith and shall reimburse the Owners for all

277
expenses incurred in connection therewith, also for any

278
new equipment required in order to comply with radio

279
regulations.
 

 280
(g) Periodical Dry-Docking - The Charterers shall dry-

281
dock the Vessel and clean and paint her underwater

282
parts whenever the same may be necessary,

283

284

285

286


287
11. Hire

288
(a) The Charterers shall pay hire due to the Owners

289
punctually in accordance with the terms of this Charter

290
in respect of which time shall be of the essence.
 

 291
(b) The Charterers shall pay to the Owners for the hire

292
of the Vessel the rate indicated in

293
Box 22 which shall be payable monthly

294
in advance, the first hire being

295
payable on the date and hour of the Vessel’s delivery to
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 296
the Charterers. Hire shall be paid continuously

297
throughout the Charter Period.
 

 298
(c) Payment of hire shall be made in cash without

299
discount in the currency and in the manner indicated
 

 300
Box 25 and at the place mentioned in Box 26.

301
(d) Final payment of hire, if for a period of less than

302
one calendar month , shall be calculated proportionally

303
according to the number of days and hours remaining

304
before redelivery and advance payment to be effected

305
accordingly.
 

 306

307

308

309

310

311

312
 

 313
(f) Any delay in payment of hire shall entitle the

314
Owners to interest at the rate per annum as agreed

315
in Box 24.

316

317

318

319
 

 320
(g) Payment of interest due under sub-clause 11(f)

321
shall be made within seven (7) Banking Days of the date

322
of the Owners’ invoice specifying the amount payable

323
or, in the absence of an invoice, at the time of the next

324
hire payment date.
 

 325
12. Mortgage

326
(only to apply if Box 28 has been appropriately filled in)

327

328

329

330
 

 331
*)  (b) The Vessel chartered under this Charter is financed

332
by a mortgage according to the Financial Instrument.

333

334

335

336

337

338

339

340

341

342

343

344

345
At the reasonable request of the Owner, the Charterers
shall provide such documents and information as the
 Owners reasonably request for their financing purposes.

 346
The Owners warrant that

347
they have not effected any mortgage(s) other than stated

348
in Box 28 and that they shall not agree to any

349
amendment of the mortgage(s) referred to in Box 28 or

350
effect any other mortgage(s) without the prior consent

351
of the Charterers, which shall not be unreasonably

352
withheld.
 

 353
*)  (Optional, Clauses 12(a) and 12(b) are alternatives;

354
indicate alternative agreed in Box 28).

355
13. Insurance and Repairs see also clause 42

356
(a) During the Charter Period the Vessel shall be kept

357
insured by the Charterers at their expense against hull

358
and machinery, war and Protection and Indemnity risks

359
(and any risks against which it is compulsory to insure

360
for the operation of the Vessel, including maintaining

361
financial security in accordance with sub-clause

362
10(a)(iii)) in such form as the Owners shall in writing approve, which approval shall not be unreasonably withheld.
363
Such insurances shall be arranged by the

 364
Charterers to protect the interests of both the Owners

365
and the Charterers and the mortgagee(s) (if any), and

366
The Charterers shall be at liberty to protect under such

367
insurances the interests of any managers they may

368
appoint. Insurance policies shall cover the Owners and

369
the Charterers according to their respective interests.

370
Subject to the provisions of the Financial Instrument, if

371
any, and the approval of the Owners and the insurers,

372
the Charterers shall effect all insured repairs and shall

373
undertake settlement and reimbursement from the

374
insurers of all costs in connection with such repairs as

375
well as insured charges, expenses and liabilities to the

376
extent of coverage under the insurances herein provided

377
for.

378
The Charterers also to remain responsible for and to

379
effect repairs and settlement of costs and expenses

380
incurred thereby in respect of all other repairs not

381
covered by the insurances and/or not exceeding any

382
possible franchise(s) or deductibles provided for in the

383
insurances.

384
All time used for repairs under the provisions of sub-

385
clause 13(a) and for repairs of latent defects according

386
to Clause 3(c) above, including any deviation, shall be

387
for the Charterers’ account.
 

 388
(b)
389
390

 391
The Owners or

392
the Charterers as the case may be shall immediately

393
furnish the other party with particulars of any additional

394
insurance effected, including copies of any cover notes

395
or policies and the written consent of the insurers of

396
any such required insurance in any case where the

397
consent of such insurers is necessary.
 

 398
(c) The Charterers shall upon the request of the

399
Owners, provide reasonable information and promptly execute such

400
documents as may be reasonably required to enable the Owners to

401
comply with the insurance provisions of the Financial

402
Instrument. Cost and time, if any, for Owners’ account.
 

 403
(d) Subject to the provisions of the Financial Instru-

404
ment, if any, should the Vessel become an actual,

405
constructive, compromised or agreed total loss under

406
the insurances required under sub-clause 13(a), all

407
insurance payments for such loss shall be paid in accordance with clause 42 to the

408
Owners who shall distribute the moneys between the

409
Owners and the Charterers according to their respective

410
interests. The Charterers undertake to notify the Owners

411
and the mortgagee(s), if any, of any occurrences in

412
consequence of which the Vessel is likely to become a

413
total loss as defined in this Clause.
 

 414
(e) The Owners shall upon the request of the
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 415
Charterers, promptly execute such documents as may

416
be required to enable the Charterers to abandon the

417
Vessel to insurers and claim a constructive total loss.
 

 418
(f) For the purpose of insurance coverage against hull

419
and machinery and war risks under the provisions of

420
sub-clause 13(a), the value of the Vessel is the sum

421
indicated in Clause 42.
 

 422

423

424

425

426

427

428

429

430

431

432

433

434

435

436

437
 

 438

439

440

441

442

443

444

445
 

 446

447

448

449

450

451
 

 452

453

454

455

456

457

458

459

460

461
 

 462

463

464

465

466

467
 

 468

469

470

471

472

473

474

475
 

 476

477

478

479

480
 

 481

482

483

484

485
 

 486

487

488

489

490

491
 

 492

493

494

495

496
 

 497

498

499

500
 

 501

502

503

504
 

 505

506

507

508

509

510
 

 511
15. Redelivery

512
At the expiration of the Charter Period the Vessel shall

513
be redelivered by the Charterers to the Owners at a

514
safe and ice-free port or place as indicated in Box 16, in

515
such ready safe berth as the Charterers may direct. The

516
Charterers shall give the Owners not less than thirty

517
(30) running days’ preliminary notice of expected date,

518
range of ports of redelivery or port or place of redelivery

519
and not less than fourteen (14) running days’ definite

520
notice of expected date and port or place of redelivery.

521
Any changes thereafter in the Vessel’s position shall be

522
notified immediately to the Owners.

523
The Charterers warrant that they will not permit the

524
Vessel to commence a voyage (including any preceding

525
ballast voyage) which cannot reasonably be expected

526
to be completed in time to allow redelivery of the Vessel

527
within the Charter Period.  Notwithstanding the above,

528
should the Charterers fail to redeliver the Vessel within

529
the Charter Period, the Charterers shall pay the daily

530
equivalent of the rate of hire that arises from Box 22 (USD 4,545.47) plus 10 per cent. or to the market rate, whichever is the higher,
531

 532
for the number of days by which the Charter Period is

533
exceeded.  All other terms, conditions and provisions of

534
this Charter shall continue to apply.

535
Subject to the provisions of Clause 10, the Vessel shall

536
be redelivered to the Owners in the same

537
condition and class as that in which she

538
was delivered, fair wear and tear not affecting class

539
excepted.
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 540
The Vessel upon redelivery shall have her survey cycles

541
up to date and trading and class certificates valid for at

542
least the number of months agreed in Box 17.


543
16. Non-Lien

544
The Charterers will not suffer, nor permit to be continued,

545
any lien or encumbrance incurred by them or their

546
agents, which might have priority over the title and

547
interest of the Owners in the Vessel.
548
549
550
551
552
553
554
555
 

 556
17. Indemnity

557
(a) The Charterers shall indemnify the Owners against

558
any loss, damage or expense incurred by the Owners

559
arising out of or in relation to the operation of the Vessel

560
by the Charterers, and against any lien of whatsoever

561
nature arising out of an event occurring during the

562
Charter Period.  If the Vessel be arrested or otherwise

563
detained by reason of claims or liens arising out of her

564
operation hereunder by the Charterers, the Charterers

565
shall at their own expense take all reasonable steps to

566
secure that within a reasonable time the Vessel is

567
released, including the provision of bail.

568
Without prejudice to the generality of the foregoing, the

569
Charterers agree to indemnify the Owners against all

570
consequences or liabilities arising from the Master,

571
officers or agents signing Bills of Lading or other

572
documents.
 

 573
(b) If the Vessel be arrested or otherwise detained by

574
reason of a claim or claims against the Owners, the

575
Owners shall at their own expense take all necessary

576
steps to secure that, within a reasonable time,  the Vessel

577
is released, including the provision of bail.

578
In such circumstances the Owners shall indemnify the

579
Charterers against any loss, damage or expense

580
incurred by the Charterers (including hire paid under

581
this Charter) as a direct consequence of such arrest or

582
detention.
 

 583
18. Lien

584
The Owners to have a lien upon all cargoes, sub-hires

585
and sub-freights belonging or due to the Charterers or

586
any sub-charterers and any Bill of Lading freight for all

587
claims under this Charter, and the Charterers to have a

588
lien on the Vessel for all moneys paid in advance and

589
not earned.
 

 590
19. Salvage

591
All salvage and towage performed by the Vessel shall

592
be for the Charterers’ benefit and the cost of repairing

593
damage occasioned thereby shall be borne by the

594
Charterers.
 

 595
20. Wreck Removal

596
In the event of the Vessel becoming a wreck or

597
obstruction to navigation the Charterers shall indemnify

598
the Owners against any sums whatsoever which the

599
Owners shall become liable to pay and shall pay in

600
consequence of the Vessel becoming a wreck or

601
obstruction to navigation.

602
21. General Average

603
The Owners shall not contribute to General Average.
 

 604
22. Assignment, Sub-Charter and Sale see also clause 38

605
(a) The Charterers shall not assign this Charter nor

606
sub-charter the Vessel on a bareboat basis (internal bareboat charters excluded) except with

607
the prior consent in writing of the Owners, which shall

608
not be unreasonably withheld or delayed, and subject to such terms

609
and conditions as the Owners shall approve.

610
(b) see clauses 39 

611

612

613

614

615
23. Contracts of Carriage

616
*)  (a) The Charterers are to procure that all documents

617
issued during the Charter Period evidencing the terms

618
and conditions agreed in respect of carriage of goods

619
shall contain a paramount clause incorporating any

620
legislation relating to carrier’s liability for cargo

621
compulsorily applicable in the trade; if no such legislation

622
exists, the documents shall incorporate the Hague Rules or  Hague-Visby

623
Rules. The documents shall also contain the New Jason

624
Clause and the Both-to-Blame Collision Clause.
 

 625

626

627

628

629

630

631

632

633

634

635
 

 636
24. Bank Guarantee

637

638

639

640

641

642
 

 643
25. Requisition/Acquisition

644
(a) In the event of the Requisition for Hire of the Vessel

645
by any governmental or other competent authority

646
(hereinafter referred to as “Requisition for Hire”)

647
irrespective of the date during the Charter Period when

648
“Requisition for Hire” may occur and irrespective of the

649
length thereof and whether or not it be for an indefinite

650
or a limited period of time, and irrespective of whether it

651
may or will remain in force for the remainder of the

652
Charter Period, this Charter shall not be deemed thereby

653
or thereupon to be frustrated or otherwise terminated

654
and the Charterers shall continue to pay the stipulated
 

 655
hire in the manner provided by this Charter until the time

656
when the Charter would have terminated pursuant to

657
any of the provisions hereof always provided however

658
that in the event of “Requisition for Hire” any Requisition

659
Hire or compensation received or receivable by the

660
Owners shall be payable to the Charterers during the

661
remainder of the Charter Period or the period of the
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 662
“Requisition for Hire” whichever be the shorter.
 

 663
(b) In the event of the Owners being deprived of their

664
ownership in the Vessel by any Compulsory Acquisition

665
of the Vessel or requisition for title by any governmental

666
or other competent authority (hereinafter referred to as

667
“Compulsory Acquisition”), then, irrespective of the date

668
during the Charter Period when “Compulsory Acqui-

669
sition” may occur, this Charter shall be deemed

670
terminated as of the date of such “Compulsory

671
Acquisition”. In such event Charter Hire to be considered

672
as earned and to be paid up to the date and time of

673
such “Compulsory Acquisition”.
 

 674
26. War

675
(a) For the purpose of this Clause, the words “War

676
Risks” shall include any war (whether actual or

677
threatened), act of war, civil war, hostilities, revolution,

678
rebellion, civil commotion, warlike operations, the laying

679
of mines (whether actual or reported), acts of piracy,

680
acts of terrorists, acts of hostility or malicious damage,

681
blockades (whether imposed against all vessels or

682
imposed selectively against vessels of certain flags or

683
ownership, or against certain cargoes or crews or

684
otherwise howsoever), by any person, body, terrorist or

685
political group, or the Government of any state

686
whatsoever, which may be dangerous or are likely to be

687
or to become dangerous to the Vessel, her cargo, crew

688
or other persons on board the Vessel.
 

 689

690

691

692

693

694

695

696

697

698

699

700
 

 701
(c) The Vessel shall not load contraband cargo, or to

702
pass through any blockade, whether such blockade be

703
imposed on all vessels, or is imposed selectively in any

704
way whatsoever against vessels of certain flags or

705
ownership, or against certain cargoes or crews or

706
otherwise howsoever, or to proceed to an area where

707
she shall be subject, or is likely to be subject to

708
a belligerent’s right of search and/or confiscation.
 

 709

710

711

712

713

714

715

716

717


718
(e) The Charterers shall have the liberty:

719
(i) to comply with all orders, directions, recommend-

720
ations or advice as to departure, arrival, routes,

721
sailing in convoy, ports of call, stoppages,

722
destinations, discharge of cargo, delivery, or in any

723
other way whatsoever, which are given by the

724
Government of the Nation under whose flag the

725
Vessel sails, or any other Government, body or

726
group whatsoever acting with the power to compel

727
compliance with their orders or directions;
 

 728
(ii) to comply with the orders, directions or recom-

729
mendations of any war risks underwriters who have

730
the authority to give the same under the terms of

731
the war risks insurance;
 

 732
(iii) to comply with the terms of any resolution of the

733
Security Council of the United Nations, any

734
directives of the European Community, the effective

735
orders of any other Supranational body which has

736
the right to issue and give the same, and with

737
national laws aimed at enforcing the same to which

738
the Owners are subject, and to obey the orders

739
and directions of those who are charged with their

740
enforcement.
 

 741

742

743

744

745

746

747

748

749

750

751

752

753

754

755

756

757

758

759
 

 760
27. Commission

761

762

763

764

765

766

767

768

769

770

771

772

773
 

 774
28. Termination

775
(a) Charterers’ Default

776
The Owners shall be entitled to withdraw the Vessel from

777
the service of the Charterers and terminate the Charter

778
with immediate effect by written notice to the Charterers if:
 

 779
(i) the Charterers fail to pay hire in accordance with

780
Clause 11.  However, where there is a failure to
 

 781
make punctual payment of hire due to oversight,

782
negligence, errors or omissions on the part of the

783
Charterers or their bankers, the Owners shall give

784
the Charterers written notice of the number of clear

785
Banking days stated in Box 34 (as recognised at

786
the agreed place of payment) in which to rectify

787
the failure, and when so rectified within such

788
number of days following the Owners’ notice, the
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 789
payment shall stand as regular and punctual.

790
Failure by the Charterers to pay hire within the

791
number of days stated in Box 34 of their receiving

792
the Owners’ notice as provided herein, shall entitle

793
the Owners to withdraw the Vessel from the service

794
of the Charterers and terminate the Charter without

795
further notice;
 

 796
(ii) the Charterers fail to comply with the requirements of:

797
(1) Clause 6 (Trading Restrictions)
 

 798
(2) Clause 13(a) (Insurance and Repairs)

799
provided that the Owners may, by

800
written notice to the Charterers, give the

801
Charterers a specified number of days grace within

802
which to rectify the failure without prejudice to the

803
Owners’ right to withdraw and terminate under this

804
Clause if the Charterers fail to comply with such

805
notice;
 

 806
(iii) the Charterers fail to rectify any failure to comply

807
with the requirements of sub-clause 10(a)(i)

808
(Maintenance and Repairs) within a reasonable time

809
after the Owners have requested them in

810
writing so to do and in any event so that the Vessel’s

811
insurance cover is not prejudiced.
812
 

 813
(b) Owners’ Default

814
If the Owners shall by any act or omission be in breach

815
of their obligations under this Charter to the extent that

816
the Charterers are deprived of the use of the Vessel

817
and such breach continues for a period of fourteen (14)

818
running days after written notice thereof has been given

819
by the Charterers to the Owners, the Charterers shall

820
be entitled to terminate this Charter with immediate effect

821
by written notice to the Owners.
 

 822
(c) Loss of Vessel See clause 42

823

824

825

826

827

828

829

830

831

832

833
 

 834
(d) Either party shall be entitled to terminate this

835
Charter with immediate effect by written notice to the

836
other party in the event of an order being made or

837
resolution passed for the winding up, dissolution,

838
liquidation or bankruptcy of the other party (otherwise

839
than for the purpose of reconstruction or amalgamation)

840
or if a receiver is appointed, or if it suspends payment,

841
ceases to carry on business or makes any special

842
arrangement or composition with its creditors.
 

 843
(e) The termination of this Charter shall be without

844
prejudice to all rights accrued due between the parties

845
prior to the date of termination and to any claim that

846
either party might have. 
 

 847
29. Repossession

848
In the event of the termination of this Charter in

849
accordance with the applicable provisions of Clause 28,

850
the Owners shall have the right to repossess the Vessel

851
from the Charterers at her current or next port of call, or

852
at a port or place convenient to them without hindrance

853
or interference by the Charterers, courts or local

854
authorities.  Pending physical repossession of the Vessel

855
in accordance with this Clause 29, the Charterers shall

856
hold the Vessel as gratuitous bailee only to the Owners.

857
The Owners shall arrange for an authorised represent-

858
ative to board the Vessel as soon as reasonably

859
practicable following the termination of the Charter.  The

860
Vessel shall be deemed to be repossessed by the

861
Owners from the Charterers upon the boarding of the

862
Vessel by the Owners’ representative.  All arrangements

863
and expenses relating to the settling of wages,

864
disembarkation and repatriation of the Charterers’

865
Master, officers and crew shall be the sole responsibility

866
of the Charterers.
 

 867
30. Dispute Resolution

868
 *) (a) This Contract shall be governed by and construed

869
in accordance with English law and any dispute arising

870
out of or in connection with this Contract shall be referred

871
to arbitration in London in accordance with the Arbitration

872
Act 1996 or any statutory modification or re-enactment

873
thereof save to the extent necessary to give effect to

874
the provisions of this Clause.

875
The arbitration shall be conducted in accordance with

876
the London Maritime Arbitrators Association (LMAA)

877
Terms current at the time when the arbitration proceed-

878
ings are commenced.

879
The reference shall be to three arbitrators.  A party

880
wishing to refer a dispute to arbitration shall appoint its

881
arbitrator and send notice of such appointment in writing

882
to the other party requiring the other party to appoint its

883
own arbitrator within 14 calendar days of that notice and

884
stating that it will appoint its arbitrator as sole arbitrator

885
unless the other party appoints its own arbitrator and

886
gives notice that it has done so within the 14 days

887
specified.  If the other party does not appoint its own

888
arbitrator and give notice that it has done so within the

889
14 days specified, the party referring a dispute to

890
arbitration may, without the requirement of any further

891
prior notice to the other party, appoint its arbitrator as

892
sole arbitrator and shall advise the other party

893
accordingly. The award of a sole arbitrator shall be

894
binding on both parties as if he had been appointed by

895
agreement.

896
Nothing herein shall prevent the parties agreeing in

897
writing to vary these provisions to provide for the

898
appointment of a sole arbitrator.

899
In cases where neither the claim nor any counterclaim

900
exceeds the sum of US$100,000 (or such other sum as

901
the parties may agree) the arbitration shall be conducted

902
in accordance with the LMAA Small Claims Procedure

903
current at the time when the arbitration proceedings are

904
commenced.
 
  905

906

907

908

909

910

911

912

913

914

915

916

917

 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter

 918

919

920

921

922
 
923

924

925

926

927

928
 

 929
(d) Notwithstanding (a), (b) or (c) above, the parties

930
may agree at any time to refer to mediation any

931
difference and/or dispute arising out of or in connection

932
with this Contract.

933
In the case of a dispute in respect of which arbitration

934
has been commenced under (a), (b) or (c) above, the

935
following shall apply:-
 

 936
(i) Either party may at any time and from time to time

937
elect to refer the dispute or part of the dispute to

938
mediation by service on the other party of a written

939
notice (the “Mediation Notice”) calling on the other

940
party to agree to mediation.
 

 941
(ii) The other party shall thereupon within 14 calendar

942
days of receipt of the Mediation Notice confirm that

943
they agree to mediation, in which case the parties

944
shall thereafter agree a mediator within a further

945
14 calendar days, failing which on the application

946
of either party a mediator will be appointed promptly

947
by the Arbitration Tribunal (“the Tribunal”) or such

948
person as the Tribunal may designate for that

949
purpose.  The mediation shall be conducted in such

950
place and in accordance with such procedure and
 

 951
on such terms as the parties may agree or, in the

952
event of disagreement, as may be set by the

953
mediator.
 

 954
(iii) If the other party does not agree to mediate, that

955
fact may be brought to the attention of the Tribunal

956
and may be taken into account by the Tribunal when

957
allocating the costs of the arbitration as between

958
the parties.
 

 959
(iv) The mediation shall not affect the right of either

960
party to seek such relief or take such steps as it

961
considers necessary to protect its interest.
 

 962
(v) Either party may advise the Tribunal that they have

963
agreed to mediation. The arbitration procedure shall

964
continue during the conduct of the mediation but

965
the Tribunal may take the mediation timetable into

966
account when setting the timetable for steps in the

967
arbitration.
 

 968
(vi) Unless otherwise agreed or specified in the

969
mediation terms, each party shall bear its own costs

970
incurred in the mediation and the parties shall share

971
equally the mediator’s costs and expenses.
 

 972
(vii) The mediation process shall be without prejudice

973
and confidential and no information or documents

974
disclosed during it shall be revealed to the Tribunal

975
except to the extent that they are disclosable under

976
the law and procedure governing the arbitration.

977
(Note: The parties should be aware that the mediation

978
process may not necessarily interrupt time limits.)
 
  979

980

981
  982

983
 

 984
31. Notices

985
(a) Any notice to be given by either party to the other

986
party shall be in writing and may be sent by e-mail,

987
registered or recorded mail or by personal service.
 

 988
(b) The address of the Parties for service of such

989
communication shall be as stated in Boxes 3 and 4

990
respectively.
 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART II
BARECON 2001 Standard Bareboat Charter







 



 





 
































 









 












 







 



 



 







 


 



 




 






 


 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART III
PROVISIONS TO APPLY FOR NEWBUILDING VESSELS ONLY
(Optional, only to apply if expressly agreed and stated in Box 37)

 




 





 
Copyright © 2001 BIMCO. All rights reserved. Any unauthorised copying, duplication, reproduction or distribution of this BIMCO SmartCon document will constitute an infringement of BIMCO’s copyright. Explanatory notes are available from BIMCO at www.bimco.org.
First published in 1974 as BARECON A and B. Amalgamated and revised in 1989. Revised 2001.
PART V
 PROVISIONS TO APPLY FOR VESSELS REGISTERED IN A
BAREBOAT CHARTER REGISTRY
 

























 


























 
PART IV
HIRE/PURCHASE AGREEMENR(Optional, only to apply if expressly agreed and stated in Box 43)

 1
 1. Definitions

2
For the purpose of this PART V, the following terms shall

3
have the meanings hereby assigned to them:

4
“The Bareboat Charter Registry” shall mean the registry

5
of the State whose flag the Vessel will fly and in which

6
the Charterers are registered as the bareboat charterers

7
during the period of the Bareboat Charter.

8
“The Underlying Registry” shall mean the registry of the

9
state in which the Owners of the Vessel are registered

10
as Owners and to which jurisdiction and control of the

11
Vessel will revert upon termination of the Bareboat

12
Charter Registration.
 

 13 
2. Mortgage

14
The Vessel chartered under this Charter is financed by

15
a mortgage and the provisions of Clause 12(b) (Part II)

16
shall apply.

17 3.
 Termination of Charter by Default

18
In the event of the Vessel being deleted from the

19
Bareboat Charter Registry as stated in Box 44, due to a

20
default by the Owners in the payment of any amounts

21
due under the mortgage(s), the Charterers shall have

22
the right to terminate this Charter forthwith and without

23
prejudice to any other claim they may have against the

24
Owners under this Charter.
 

Rider Clauses 32 to 49
to be deemed incorporated to the
Bareboat Charter Party
Dated 24th July 2024
(the "Charter")
Between
Synthesea Maritime Co. (guaranteed by United Maritime Corporation) as Charterers
and Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A. as Owners
in respect of the vessel MV “Ikan Kerapu” tbr “Synthesea”

32.
Additional Definitions
In this Charter, unless the context otherwise requires, the following expressions shall have the following meanings:

“Additional Clauses” means these additional clauses 32 to 49 to the Barecon 2001 bareboat charter dated 24th July 2024.

“Charter” means the Barecon 2001 bareboat charter dated 24th July 2024 and these Additional Clauses.

“Charterers’ Guarantor” means United Maritime Corporation.

“Charter Hire” means the charter hire as per Box 22, Clause 11 and Clause 45.

“Classification Society” means classification society of the Vessel as indicated in Box 10 or such other classification society elected in accordance with Clause 10.

“Delivery Date” has the meaning given to it in Clause 33.

“Loan Outstanding” has the meaning given to it in Clause 45.

“MOA” means the memorandum of agreement in respect of the Vessel of even date herewith entered into between the Charterers (as sellers) and the Owners (as buyers) (as the same may be amended, supplemented or varied from time to time).

“Mortgagee” means THE EHIME BANK, LTD., in its capacity as registered holder of a first priority mortgage on the Vessel or any replacement holder of a first priority mortgage on the Vessel.

“Owners” means collectively Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A..

“Quotation Day” means, in relation to any period for which 3 Month TERM CME SOFR is to be determined, five (5) US Government Securities Business Days before the first day of that period. The first Quotation Day will be five (5) US Government Securities Business Days before the Delivery Date.

“Total Loss” has the meaning given to it in Clause 42.

33.
Delivery
The Charterers shall take delivery of the Vessel under this Charter simultaneously with delivery of the Vessel by the Charterers as sellers to the Owners as buyers under the MOA, and the Owners shall be obliged to deliver the Vessel to the Charterers hereunder in the same moment as the Owners are taking delivery of the Vessel under the MOA (such date to be referred to as the “Delivery Date”) without any settlement for any remaining bunkers and unused lubricating oils including hydraulic oils and greases, unbroached provisions, paints, ropes and other consumable stores which are excluded from the sale and shall be kept by the Charterers as sellers.

In the event that the Vessel is not delivered under the MOA for whatever reason, this Charter shall automatically be terminated and treated as null and void.


USD18,000,000*(3 month CME TERM SOFR at the time of remittance + 2.70% Margin)/360) per day (the “Remittance Interest Cost”) from the day of remittance of the fund till the closing date to be covered by Charterers.
 
34.
Conditions for delivery
Prior to delivery of the Vessel under this Charter, the parties shall exchange the following documents:


 (a)
A PDF copy of one (1) Certificate of Incumbency or equivalent issued not more than five (5) Banking Days before the date of delivery of the Vessel, stating all directors and shareholders and that the subject company is in good standing;


(b)
PDF copies of the corporate resolutions of the Owners and the Charterers approving the contents of and the entering into of the MOA and the Charter;


(c)
A PDF copy of one (1) Power of Attorney granted by the Owners and the Charterers with respect to the representative(s) at closing and the persons signing this Charter and the MOA, with the originals to follow as soon as possible after delivery of the Vessel; and

 
(d)
such other documents as each of the Owners and Charterers may reasonably require.

35.
Vessel’s condition on delivery
The Vessel shall be delivered under this Charter in the same condition and with the same equipment, inventory and spare parts as she is delivered to the Owners under the MOA. The Charterers know the Vessel’s condition at the time of delivery, and expressly agree that the Vessel's condition as delivered under the MOA is acceptable and in accordance with the provisions of this Charter. The Vessel shall be delivered to the Charterers under the Charter strictly "as is/where is", and the Charterers shall have no claim against the Owners under this Charter or otherwise as a result of the Vessel’s physical condition.
 
36.
Inspection on re-delivery of the Vessel (see also clause 7)
In connection with the redelivery of the Vessel under the Charter, the Vessel shall not be dry-docked unless required by the Classification Society.
 
In lieu of dry-docking, Owners shall have the right to appoint a diver acceptable to the Classification Society to undertake an underwater inspection at a convenient port after giving reasonable notice and with due consultation between Owners and Charterers. Such divers’ inspection shall be carried out at Owners’ expense and without interference to the Vessel’s trading and normal operation.
 
Should such underwater inspection reveal damages that affect the class of the Vessel whereby such damage repairs cannot be made to the Vessel without dry-docking and the Classification Society will not grant an extension, then Vessel is to be dry-docked as soon as possible by Charterers to repair such damages to the Classification Society’s satisfaction at Charterers’ time and expense.

If in the opinion of the Classification Society the damages do not necessitate immediate dry-docking, then the Classification Society shall issue a certificate showing the extent and place of damage and Charterers shall repair same to the satisfaction of the Classification Society at next dry-docking, provided that such dry-docking is within the Charter Period. If the next Classification Society dry-docking is after the re-delivery of the Vessel under this Charter, the Charterers shall in their option (i) repair such damages before redelivery of the Vessel hereunder or (ii) provide the Owners with an agreed lump sum, (the Charterers and the Owners shall each select a reputable shipyard in the redelivery range and obtain from such shipyard a quotation for the cost of repairs of the damage. The estimated cost of repairs shall be defined as the average of the two quotations obtained from the two shipyards), a first class bank guarantee or sum a cash deposit to be provided, in the Charterers’ option, covering the expected costs of such repairs.


The Vessel with everything belonging to her shall be at the Charterers’ risk and expense until she is delivered to the Owners, but subject to the terms and conditions of this Charter she shall be re-delivered and taken over as she was at the time of joint surveys in accordance with clause 7 in this Charter, fair wear and tear excepted.

37.
Familiarisation
The Owners shall have a right to place two representatives on board the Vessel for familiarisation purposes twenty-one (21) days prior to the redelivery of the Vessel to Owners under this Charter.  These representatives and the Owners shall sign the Charterers’ usual indemnity form. Charterers shall cooperate with Owners’ representatives for their reasonable comments, requests and questions which they may have for familiarisation purpose.
 
38.
Owners’ Assignment, Performance Guarantee and Quiet Enjoyment Letter
The Owners warrant that its purpose and business will be the acquisition and bareboat chartering out of the Vessel as contemplated in this Charter and the MOA.

The Owners shall have the right to assign to any and all mortgagees of the Vessel who are banks financing the Vessel any and all of the rights, benefits and interest of the Owners in and to this Charter, including but not limited to assignments of earnings and assignment of this Charter and Vessel’s insurance subject to Clause 42.

The Charterers are entitled to receive a quiet enjoyment letter from the financiers of the Owners and the Owners shall also agree to issue a quiet enjoyment letter from the Owners if so requested by the Charterers. Such quiet enjoyment letters to be on terms acceptable to the Charterers.

The Owners hereby undertake to the Charterers throughout the term of this Charter that, as long as no Charterers’ Default has occurred and is continuing, the Owners and the financiers of the Owners shall not disturb or interfere in any way whatsoever with the quiet and peaceful use, enjoyment, possession and employment of the Vessel by the Charterers.

The performance of the Charterers hereunder shall be guaranteed by the Charterers' Guarantor. The guarantee shall be in the format attached hereto as Appendix A.

39.
Transfer of the Vessel
(a) Any change of ownership of the Vessel or of the ownership of the Owners during the Charter Period shall require the Charterers' prior written approval which Charterers shall be at full discretion whether to grant or decline.
 
(b) The Owners undertake that Ocean West Shipping S.A. shall remain a wholly owned subsidiary of Onishi Kaiun Co., Ltd. during the term of this Charter. A change of control in Ocean West Shipping S.A. shall be deemed as owners’ default under Clause 28 of this Charter.
 
(c) Each of the Owners and Charterers shall during the Charter Period be entitled to assign their rights and obligations to any of their affiliates under the Charter subject to the prior written consent of the other Party, which shall not be unreasonably withheld, and in such case the guarantee granted hereunder shall continue to remain in full force and effect irrespective of the said assignment(s) under the Charter. Each Party shall bear their own costs related to the above assignments.
 
40.
[Intentionally Omitted]
 
41.
[Intentionally Omitted]
 

42.
Insurance
(a)
For the purposes of this Charter, the term "Total Loss" shall mean any actual or constructive or compromised or agreed or arranged total loss of the Vessel including any such total loss as may arise during a requisition for hire.

(b)
The Charterers undertake with the Owners that throughout the Charter Period:

 
(i)
without prejudice to their obligations under Clause 13 hereof, they will keep the Vessel insured on the basis of the Institute of London Underwriters "Institute Time Clause-Hull" and “Institute War and Strikes Clauses” as amended or similar, as the Charterers shall choose with such insurers (including P&I Clubs and war risks Associations) as the Charterers shall choose, provided that all insurances are issued with reputable insurers and that the P&I association is a member of the International Group of P&I Clubs;

 
(ii)
the policies in respect of the insurances against fire and usual marine risks and the policies or entries in respect of the insurances against war risks shall, in each case, be endorsed to the effect that payment of a claim for a Total Loss will be made to the Owners (or the Mortgagees as assignees thereof) (who shall upon the receipt thereof apply the same in the manner described in Clause 42 (e) hereof);

 
(iii)
the Charterers shall procure that duplicates or copies of all cover notes, policies and certificates of entry shall be furnished to the Owners for their custody, upon request;

 
(iv)
the Charterers shall procure that the insurers and the war risk and protection and indemnity associations with which the Vessel is entered shall:

 
(A)
furnish the Owners and Mortgagee with a letter or letter of undertaking in such form as may from time to time be reasonably required by the Owners, and

 
(B)
supply to the Owners such information in relation to the insurances effected, or to be effected, with them as the Owners may from time to time reasonably require; and

 
(v)
the Charterers shall procure that the policies, entries or other instruments evidencing the insurances are endorsed to the effect that the insurers shall give to the Owners not less than five (5) days prior written notification of any amendment, suspension, cancellation or termination of the insurances, unless subject to any automatic termination/cancellation of cover provisions in the relevant insurances, in which event, if such insurances are automatically terminated/cancelled, Owners shall be advised promptly and Charterers shall immediately procure re-instatement or replacement insurances of those terminated/cancelled insurances.

(c)
Notwithstanding anything to the contrary contained in Clauses 13 and 42 (b) hereof, the Vessel shall be kept insured during the Charter Period in respect of marine and war risks on hull and machinery basis for not less than one hundred and ten per cent (110%) of the Loan Outstanding (hereinafter referred to as the "Minimum Insured Value").

The Owners may request the Charterers to increase the insurance value above the Minimum Insured Value, however, any additional insurance costs related thereby shall be for the Owners' account.

(d)
If the Vessel becomes a Total Loss or becomes subject to Compulsory Acquisition the chartering of the Vessel to the Charterers hereunder shall cease and the Charterers shall:

  (i)
immediately pay to the Owners all hire, and any other amounts, which have fallen due for payment under this Charter and have not been paid as at up to the date on which the Total Loss or Compulsory Acquisition occurred as described below (the "Date of Loss") and shall cease to be under any liability to pay any further hire. All hire and any other amounts prepaid by the Charterers relating to the period after the Date of Loss shall be forthwith refunded by the Owners and any hire paid in advance to be adjusted/reimbursed.

 
(ii)
For the purpose of ascertaining the Date of Loss:

 
(A)
an actual total loss of the Vessel shall be deemed to have occurred on the actual date the Vessel was lost but in the event of the date of the loss being unknown the actual total loss shall be deemed to have occurred on the date on which it is acknowledged by the insurers to have occurred;


 
(B)
a constructive, compromised, agreed, or arranged total loss of the Vessel shall be deemed to have occurred on the date that notice claiming such a total loss of the Vessel is given to the insurers, or, if the insurers do not admit such a claim, at the date and time at which a total loss is subsequently admitted by the insurers or the date and time adjudged by a competent court of law or arbitration tribunal to have occurred. Either the Owners or, with the prior written consent of the Owners (such consent not to be unreasonably withheld), the Charterers shall be entitled to give notice claiming a constructive total loss but prior to the giving of such notice there shall be consultation between the Charterers and the Owners and the party proposing to give such notice shall be supplied with all such information as such party may request; each of the Owners and the Charterers, upon the request of the other, shall promptly execute such documents as may be required to enable the other to abandon the Vessel and claim a constructive total loss and shall give all possible assistance in pursuing the said claim; and

 
(C)
Compulsory Acquisition shall be deemed to have occurred at the time of occurrence of the relevant circumstances described in Clause 25(b) hereof.

(e)
All moneys payable under the insurance effected by the Charterers pursuant to Clauses 13 and 42, or other compensation, in respect of a Total Loss or pursuant to Compulsory Acquisition of the Vessel shall be received in full by the Owners (or the Mortgagees as assignees thereof) and applied by the Owners (or, as the case may be, the Mortgagees):
FIRSTLY, in payment of all the Owners’ or the Charterers’ costs incidental to the collection thereof,

SECONDLY, in or towards payment to the Owners (to the extent that the Owners have not already received the same in full) of a sum equal to the Loan Outstanding as of the date of the Total Loss,

THIRDLY, in payment of any surplus to the Charterers by way of compensation for early termination.

(f)
In respect of partial losses, any payment by insurance underwriters not exceeding USD500,000.00 shall be paid directly to the Charterers who shall apply the same to effect the repairs in respect of which payment is made. Any moneys in excess of USD 500,000.00 payable under such insurance other than Total Loss shall be paid to the Charterers subject to the prior written consent of the Owners or the Owners’ bank but such consent shall not be unreasonably withheld or delayed. In the absence of such prior written consent the money shall be paid to the Owners or the Owners’ bank who shall apply the same for Charterers' effect of the repairs in respect of which payment is made.

(g)
The provisions of Clauses 13 and 42 hereof shall not apply in any way to the proceeds of any additional insurance cover effected by the Owners and/or the Charterers for their own account and benefit.

(h)
The Charterers shall promptly notify the Owners of:


(i)
any accident to the Vessel involving repairs the cost of which exceeds USD 500,000.00 or the equivalent in any other currencies; or


(ii)
any occurrence in consequence whereof the Vessel has become a Total Loss or Compulsory Acquisition.

43.
Inconsistency
In case of any inconsistency between (i) the standard terms of this Charter and (ii) the Rider Clauses, the latter shall prevail.

44.
Registration and other Fees
Any and all reasonable and documented fees and charges incurred by the Owners in connection with registration of the Vessel on delivery, including but not limited to THE EHIME BANK, LTD.’s upfront fee and mortgage registration fees, shall be borne by the Charterers, with the aggregate amount to be limited to USD 35,000.00.


45.
Floating part of charter hire
In the charter hire structure set out in Box 22, the Floating part shall be calculated by multiplying Loan Outstanding, as set out in the table below, times (3 Month TERM CME SOFR plus 2.70%) times number of days during the upcoming month divided by 360 days.

3 Month TERM CME SOFR will be set on each applicable Quotation Day, will be updated on a monthly basis and shall remain unchanged for one (1) consecutive charter hire payment. Should the 3 Month TERM CME SOFR rate fall below zero, a SOFR rate equal to zero to be applied.
　　　
Loan Outstanding:
 
1st Year
1st Month
18,000,000
  
2nd Year
13th Month
16,363,632
1st Year
2nd Month
17,863,636
  
2nd Year
14th Month
16,227,268
1st Year
3rd Month
17,727,272
  
2nd Year
15th Month
16,090,904
1st Year
4th Month
17,590,908
  
2nd Year
16th Month
15,954,540
1st Year
5th Month
17,454,544
  
2nd Year
17th Month
15,818,176
1st Year
6th Month
17,318,180
  
2nd Year
18th Month
15,681,812
1st Year
7th Month
17,181,816
  
2nd Year
19th Month
15,545,448
1st Year
8th Month
17,045,452
  
2nd Year
20th Month
15,409,084
1st Year
9th Month
16,909,088
  
2nd Year
21st Month
15,272,720
1st Year
10th Month
16,772,724
  
2nd Year
22nd Month
15,136,356
1st Year
11th Month
16,636,360
  
2nd Year
23rd Month
14,999,992
1st Year
12th Month
16,499,996
  
2nd Year
24th Month
14,863,628
3rd Year
25th Month
14,727,264
  
4th Year
37th Month
13,090,896
3rd Year
26th Month
14,590,900
  
4th Year
38th Month
12,954,532
3rd Year
27th Month
14,454,536
  
4th Year
39th Month
12,818,168
3rd Year
28th Month
14,318,172
  
4th Year
40th Month
12,681,804
3rd Year
29th Month
14,181,808
  
4th Year
41st Month
12,545,440
3rd Year
30th Month
14,045,444
  
4th Year
42nd Month
12,409,076
3rd Year
31st Month
13,909,080
  
4th Year
43rd Month
12,272,712
3rd Year
32nd Month
13,772,716
  
4th Year
44th Month
12,136,348
3rd Year
33rd Month
13,636,352
  
4th Year
45th Month
11,999,984
3rd Year
34th Month
13,499,988
  
4th Year
46th Month
11,863,620
3rd Year
35th Month
13,363,624
  
4th Year
47th Month
11,727,256
3rd Year
36th Month
13,227,260
  
4th Year
48th Month
11,590,892
5th Year
49th Month
11,454,528
        
5th Year
50th Month
11,318,164
        
5th Year
51st Month
11,181,800
        
5th Year
52nd Month
11,045,436
        
5th Year
53rd Month
10,909,072
        
5th Year
54th Month
10,772,708
        
5th Year
55th Month
10,636,344
        
5th Year
56th Month
10,499,980
        
5th Year
57th Month
10,363,616
        
5th Year
58th Month
10,227,252
        
5th Year
59th Month
10,090,888
        
5th Year
60th Month
9,954,524
        

46.
Charterers’ information undertaking
(a)
The Charterers shall obtain an appraisal report from Clarksons Platou, Braemar ACM, Fearnleys AS, Arrow Valuations, Simpson Spence & Young Limited, Howe Robinson, BRS Group, Seaborne and Allied Shipbroking or any other firm or firms of shipbrokers approved in writing by the Owners as of each last business day of March during the Charter Period and provide such report to the Owners.


(b)
The Charterers and/or the Charterers' Guarantor shall provide the Owners with each of its audited (in the case of the Charterers' Guarantor) or unaudited (in the case of the Charterer) financial reports on an annual basis during the Charter Period within 180 days from each of its financial year end.

47.
Money laundering, sanctions, anti-corruption:
Notwithstanding any other clause in this Charter, each Party warrants, represents and undertakes to the other Party on a continuing basis:

(Money laundering):
that it, and parties acting on its behalf in relation to this Charter, shall observe and abide with, including but not limited any law, official requirement or other regulatory measure or procedure implemented to combat money laundering as defined in any laws or regulations applicable to such Party, and

(Sanctions):
that it, nor any of their directors, executive managers and owners, is under any sanction, prohibition or blacklist whatsoever imposed by the USA, the UK, the European union, any EU member state, the Arab Boycott League, Japan, China or the United Nations or any other nation or governmental body or organization relevant to the trading of the Vessel under this Charter, and

that it, its directors, executive managers and owners, has not been a party, either directly or indirectly, to any contract or conduct in contravention of any applicable sanctions legislation or directives of the USA, the UK, the European union, any EU member state, the Arab Boycott League, Japan, China or the United Nations or any other nation or governmental body or organization relevant to the trading of the Vessel under this Charter. Moreover, the Party is acting for itself only and is not acting on behalf of any other individual or corporation, and

(Anti-corruption):
that it, its directors, executive managers and owners shall comply with all applicable anti-corruption laws, regulations and contractual provisions, including without limitation the US Foreign Corrupt Practices Act and the UK Bribery Act, and

that it, its directors, executive managers and owners shall not, directly or through third parties, in relation to the Charter, give, promise or attempt to give, or approve or authorize the giving of, anything of value to any person, any public official or any entity for the purpose of:

 -
securing any improper advantage for either Party;

-
inducing or influencing anyone improperly to take action or refrain from taking action in order for either Party to obtain or retain business, or to secure the direction of business to either Party;

-
inducing or influencing anyone to use his/her influence with any Government or public international organization for such purpose; and

that:

 -
to the best of its knowledge, none of its directors, executive managers or owners have carried out any of the actions described above;

-
all remuneration received under this Charter is solely intended as compensation for the services expressly provided under this Charter, including the Parties’ related documented costs and expenses, and that it is not receiving remuneration for any other purpose; and,

-
neither the Party, nor any of its companies, directors, executive managers or owners shall use any part of said remuneration for any purpose prohibited under this Clause 47, and

(Others):
that neither it, its directors, executive managers and owners, have been suspended from doing business in any form subject to investigation or charged with or sentenced for relevant criminal behaviour, fraud, false statements, corruption or other related activities.

The Owners and the Charterers to indemnify the other party for any costs, damages or losses of whatsoever nature which such other party may suffer as a result of breach of this Clause 47.


48.
ETS – Emission Trading Scheme
 
Notwithstanding any other provision in this Charter, the Owners and the Charterers agree as follows:

"Emission Allowances" means an allowance, credit, quota, permit or equivalent, representing a right of a vessel to emit a specified quantity of greenhouse gas emissions recognised by the Emission Scheme, or generally in connection with emissions, carbon reduction or other environmental or sustainability national or international laws or regulations applicable to the Vessel and her operation.

"Emission Scheme" means a greenhouse gas emissions trading scheme and any emissions, carbon reduction or other environmental or sustainability national or international laws or regulations applicable to the Vessel and her operation, which for the purposes of this Clause 48 shall include (without limitation) the European Union Emissions Trading System and any other similar systems imposed by any similar or equivalent international, regional, national or local scheme implemented by the IMO or any other lawful national or other authority that regulate the issuance, allocation, trading or surrendering of Emission Allowances.


 (i)
Subject to any mandatory provisions of any applicable Emissions Scheme and the corresponding national or international laws and regulations, the Charterers shall exercise their best endeavours to take all necessary actions to  be the sole responsible party for compliance with all Emission Scheme obligations in relation to the Vessel, provided this is feasible and legally permissible, pursuant to any domestic or international law or regulation, directed to the Owners as registered or beneficial owners of the Vessel.
 

 (ii)
Notwithstanding sub-paragraph (i) above, the Charterers shall be permitted to sub-delegate such Emission Scheme responsibility on to any entity, including without limitation to the relevant holder of Document of Compliance/ISM Company under the ISM Code in respect of the Vessel, as it may be lawfully allowed by the applicable Emission Scheme and subject to the consent of the holder of the Document of Compliance/ISM Company of the Vessel. Such sub-delegation shall be documented in accordance with the requirements imposed by the relevant Emissions Scheme and a signed copy of such documentation shall be provided by or made available to the Owners, as may be applicable, including but not limited to any written mandate requested by the competent authorities.
 

 (iii)
The Charterers and the Owners shall co-operate and assist each other to deliver all such forms as are required to be filed to any relevant authorities in relation to the delegation and assumption of any Emission Scheme responsibilities within reasonable time and always in accordance with any deadlines set by the competent authority and the applicable laws or regulations.
 

 (iv)
Without limiting the foregoing, throughout the Charter Period, the Charterers or any mandated entity, shall arrange for providing and paying for or otherwise surrendering the Emission Allowances corresponding to the Vessel’s emissions under the scope of the applicable Emission Scheme without any delay whatsoever.
 

 (v)
Emission Allowances, taxes, charges, levies, fees, fines, costs or expenses incurred or imposed in connection with any Emissions Scheme, shall be for the Charterers' account and are to be settled directly by them or their mandated entity (subject always to any mandatory provisions of the applicable Emissions Scheme or relevant laws or regulations).
 

 (vi)
The Charterers shall use their best endeavours to ensure that the Charterers or any mandated, as above, entity shall comply, sign, acknowledge in writing in any form that may be reasonably required, and provide all such information and documents to the Owners as necessary to enable the Owners and any Emission Scheme obligor to document and evidence to any authority their delegation/mandating of all Emission Scheme obligations in relation to the Vessel (and the assumption of same by the relevant mandated entity), as may be required from time to time during the Charter Period by the Owners, any manager or other mandated entity, and any relevant Emission Scheme authority, in conformity with the provisions of this Clause. The Owners shall also ensure to provide the Charterers with all necessary information, documents or details as above and as same may be required by any authorities in connection any applicable Emissions Scheme, including but not limited to opening any accounts and/or surrendering any Emissions Allowances, in order to ensure that the Vessel will comply with any applicable Emissions Scheme laws and regulations.
 


 (vii)
The Owners undertake to relay to the Charterers, without delay, any information that might be received by the Owners for any reason whatsoever, including by error of any authority, and which might relate to compliance with any Emission Scheme.
 
49.
Confidentiality
This Charter including all negotiations, fixtures and written correspondence shall remain strictly confidential between the Owners, the Charterers, financiers/banks, external counsels, auditors and insurance companies provided however that each of the Owners, Charterers and Charterers’ Guarantor may disclose as much as may be necessary of the terms of this Charter and relevant documentation to their auditors, third party managers, legal counsels, accountants, affiliates and as otherwise may be required by applicable laws or regulations, including but not limited to any stock exchange and/or securities and exchange commission laws and regulations. Any report or release or publication of the lease back shall not be grounds for either the Owners or the Charterers to withdraw from their obligations under this Charter. Press releases or reports as required by stock exchange rules and regulations are allowed.


IN WITNESS HEREOF the Owners and the Charterers have signed and executed TWO COPIES of this Charter the day and year first written.

For the Owners:
For the Charterers:


/s/ Shotaro Onishi
/s/ Stavros Gyftakis

 
 
Onishi Kaiun Co., Ltd. Synthesea Maritime Co.
Shotaro Onishi
Stavros Gyftakis
Director
Director/ Treasurer

For the Owners:


/s/ Shotaro Onishi

 
Ocean West Shipping S.A.
Shotaro Onishi
Director/Secretary


Appendix A

Performance Guarantee

Date : 24th July 2024
To:
Onishi Kaiun Co., Ltd.
Daito Shoji Bldg. 6F, 1-13-4, Katsuyama-cho, Matsuyama-city, Ehime, 790-0001, Japan

OCEAN WEST SHIPPING S.A.
c/o Onishi Kaiun Co., Ltd.
Daito Shoji Bldg. 6F, 1-13-4, Katsuyama-cho, Matsuyama-city, Ehime, 790-0001, Japan
(collectively, the “Owners”)

Dear Sirs,
GUARANTEE

In consideration of the entry into by you of a Memorandum of Agreement (hereinafter called the “MOA”) dated 24th July 2024, with Synthesea Maritime Co. as sellers (hereinafter called “Synthesea Maritime”) for the sale and purchase of the motor vessel "Synthesea" with IMO number 9697959 (hereinafter called the “Vessel”) and a Bareboat Charter Party (hereinafter called the “BBCP”) dated 24th July 2024, with Synthesea Maritime as charterers for the bareboat chartering of the Vessel, we, the undersigned, as the primary obligor, guarantee to you and your successors and assignees the due and punctual performance by Synthesea Maritime of all its liabilities, obligations and responsibilities under the MOA and the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto.

If, at any time, default is made by Synthesea Maritime in the performance and/or observance of any term, provision, condition, obligation or agreement, or in any other matter or thing pertaining to the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto, or in the payment of any sums payable pursuant thereto which are to be complied with by Synthesea Maritime, its successors or assignees, then we will perform, or cause to be so performed, all terms, provisions, conditions, obligations and agreements contained in the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto, and will pay, as our own debt and within five (5) Banking Days (as defined in the BBCP) on demand, any sum that is due and payable in consequence of the non-performance by Synthesea Maritime, its successors and assignees, of any of the said terms, provisions, conditions, obligations and agreements.


Any demand made by the Owners under this guarantee shall be made in writing signed by an authorized signatory of the Owners and shall specify the default of Synthesea Maritime and shall be accompanied by a copy of the notice of such default served on Synthesea Maritime by the Owners together with a statement (if any) that Synthesea Maritime have failed to remedy such default within any applicable grace period.

We hereby irrevocably and unconditionally agree to indemnify you on demand and keep you indemnified against all costs, expenses, claims, liabilities, and fees (including, but not limited to, reasonable and documented legal fees) and taxes thereon suffered or incurred by you, directly as a result of any breach or non-performance of, or non-compliance by Synthesea Maritime with, any of its obligations under or pursuant to the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto, or as a result of any of those obligations being or becoming void, voidable or unenforceable.

The undersigned hereby affirm and consent to any and all amendments, changes or modifications to be hereafter made to the MOA or BBCP without requesting any further notice and without such amendments, changes or modifications in any way affecting, changing or releasing us from our obligations given under this guarantee.

We hereby represent, warrant and undertake, that:


 a)
We have full power, authority and capacity to enter into and perform our obligations under this guarantee and have taken all necessary corporate or other action (as the case may be) required to enable us to do so and our entry into of this guarantee will not exceed any power in our constitutional documents;

b)
This guarantee constitutes valid and legally binding obligations of us enforceable in accordance with its terms;

c)
All consents, licenses, approvals and authorizations of governmental authorities and agencies required to make this guarantee valid, enforceable and admissible in evidence and to authorize and permit the execution, delivery and performance of this guarantee by us have been obtained or made and will remain in full force and effect and there has been no default in the observance of any of the terms or conditions of any of them;



d)
We have not taken nor received, and undertake that until all the obligations of Synthesea Maritime under the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto have been paid or discharged in full we will not take or receive, the benefit of any security from Synthesea Maritime or any other person in respect of our obligations under this guarantee;

e)
We will inform you of any occurrence of which we become aware which might adversely affect the ability of us to perform our obligations under this guarantee and will from time to time, if so reasonably requested by you, confirm to you in writing that, save as otherwise stated in such confirmation, no event of default under the BBCP has occurred and is continuing; and

f)
We will not assign or transfer any of our rights or obligations under this guarantee.

This guarantee:


 a)
shall become effective upon signing of the MOA and BBCP and shall only become null and void upon the fulfillment of all obligations of Lord Ocean under the MOA and BBCP whereafter this guarantee shall be immediately returned to us;

b)
shall be in addition to, and shall not be prejudiced or affected by, any other security for the obligations of Synthesea Maritime which may be from time to time held by you; and

c)
shall not be discharged or prejudiced by the liquidation, bankruptcy or dissolution (or proceedings analogous thereto) of Synthesea Maritime or the appointment of a receiver or administrative receiver or administrator or trustee or similar officer of any of the assets of Synthesea Maritime or any term or concessions given by you to Synthesea Maritime or any other party, or, subject to applicable limitation periods, by anything which you may do or omit to do or by any other dealing or thing whatsoever which but for the provisions of this paragraph might operate to discharge us from liability.

The provisions of clause 31 (Notices) of the BBCP shall apply (mutatis mutandis) to this guarantee.

This guarantee, and all rights and obligations arising hereunder shall be governed by and construed and determined and may be enforced in accordance with the Laws of England.


Any dispute arising out of in connection with this guarantee shall be referred to arbitration in London in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect to the provisions of this clause.

The arbitration shall be conducted under and in accordance with London Maritime Arbitrator Association (L.M.A.A.) terms and conditions current at the time when the arbitration proceedings are commenced.

The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator and send notice of such appointment in writing to the other party requiring the other party to appoint its own arbitrator within 14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own arbitrator and give notice that it has done so within the 14 days specified, the party referring a dispute to arbitration may, without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement. Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole arbitrator.

In cases where neither the claim nor any counterclaim exceeds the sum of US$200,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the LMAA Small Claims Procedure current at the time when the arbitration proceedings are commenced.

For and on behalf of
United Maritime Corporation (as the “Guarantor”)

   
Name: Stavros Gyftakis
Title: Chief Financial Officer/ Director


EX-4.33 9 ef20039046_ex4-33.htm EXHIBIT 4.33
Exhibit 4.33

Addendum No.1
Bareboat Charter Party
dated 24th July 2024
(the "Charter")
Between

Synthesea Maritime Co. as Charterers
Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A., as Owners
in respect of the vessel

M/V “Ikan Kerapu” tbr “Synthesea”

It has today been agreed that both the Charterers and the Owners have an option to extend the bareboat-period by 2 years (the "Option Period"). The Charterers need to declare their intention to exercise such option within 56 months after the Charter has commenced. If they do not declare their intention to exercise the option within the period set out above, the Owners may exercise their option to extend the Charter declarable within 57 months after the Charter has commenced. If either party exercises their option to extend the Charter by two (2) years, following terms shall apply:

Charter hire:

During the Option Period, the charterers shall pay Hire as follows.

・6th – 7th year
Fixed Rate: USD136,364 per month; plus
Floating Part: (Margin (2.70%) + 3month CME TERM SOFR) x Loan Outstanding x Number of days/360

Insurance (Clause 42)
 
The Charterers undertake with the Owners that throughout the extended Charter Period to keep the Vessel insured as follows:-

 
(a)
  
(b)
 
Year
  
Minimum Insured Value
 
6
  
USD 10,799,976
 
7
  
USD 8,999,971


Loan Outstanding Table (Clause 45)

(In USD)
6th Year
61th Month
9,818,160
  
7th Year
73th Month
8,181,792
6th Year
62th Month
9,681,796
  
7th Year
74th Month
8,045,428
6th Year
63th Month
9,545,432
  
7th Year
75th Month
7,909,064
6th Year
64th Month
9,409,068
  
7th Year
76th Month
7,772,700
6th Year
65th Month
9,272,704
  
7th Year
77th Month
7,636,336
6th Year
66th Month
9,136,340
  
7th Year
78th Month
7,499,972
6th Year
67th Month
8,999,976
  
7th Year
79th Month
7,363,608
6th Year
68th Month
8,863,612
  
7th Year
80th Month
7,227,244
6th Year
69th Month
8,727,248
  
7th Year
81th Month
7,090,880
6th Year
70th Month
8,590,884
  
7th Year
82th Month
6,954,516
6th Year
71th Month
8,454,520
  
7th Year
83th Month
6,818,152
6th Year
72th Month
8,318,156
7th Year
84th Month
6,681,788
       
Balloon
  
6,545,424

Otherwise, all other terms and conditions of Bareboat Charter Party (the "Charter") dated 24th July 2024 agreed between Synthesea Maritime Co. as charterers and Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A. as owners with its rider clauses and any addendums there to shall remain unaltered and in full force and effect.

 
Onishi Kaiun Co., Ltd.
  
Synthesea Maritime Co.
 
Signature (Owner)
  
Signature (Charterer)
       
 
/s/ Shotaro Onishi
  
/s/ Stavros Gyftakis
       
     
Name: Stavros Gyftakis
 
Name: Shotaro Onishi
  
Title: Director
 
Title: Director
  

 
Ocean West Shipping S.A.
    
 
Signature (Owner)
    
       
 
/s/ Shotaro Onishi
    
 
Name: Shotaro Onishi
    
 
Title: Director/Secretary
  


EX-4.34 10 ef20039046_ex4-34.htm EXHIBIT 4.34
Exhibit 4.34

Addendum No.2
Bareboat Charter Party
dated 24th July 2024
(the "Charter")
Between

Synthesea Maritime Co. as Charterers
Onishi Kaiun Co., Ltd. and Ocean West Shipping S.A., as Owners
in respect of the vessel

M/V “Ikan Kerapu” tbr “Synthesea”

It has today been agreed that the Charterers have an option to purchase the Vessel from the Owners (the "Purchase Option") and the Owners have an option to sell the Vessel back to the Charterers (the "Put Option") as follows.

Charterers’ Purchase Option
 
Charterers may purchase the Vessel at any time during the Charter, starting from the end of the 2nd year after the Delivery Date, or in case of a default hereunder by the Owners at any time during the Charter, at a price (the "Purchase Option Price") as presented in Appendix A of this Addendum No. 2.

Charterers obligation to pay Charter Hire shall cease to apply from the actual delivery date of the Vessel under the Purchase Option.

The Charterers must give a minimum of ninety (90) days' written notice of their intention to buy the Vessel (the “Purchase Option Notice”). The Purchase Option Price shall be paid to the Owners upon delivery of the Vessel. The Vessel shall be delivered as soon as possible after expiry of the ninety (90) days' notice and Owners undertake to render the necessary assistance in order to achieve this. Once the Purchase Option has been exercised by Charterers, they may not withdraw same.

The Owners agree (at the cost of the Charterers) to enter into (i) a bill of sale and (ii) a protocol of delivery and acceptance, and the Vessel shall accordingly be deemed delivered to the Charterers on the date and time set out in such protocol of delivery and acceptance (and to the extent required for such purposes the Vessel shall be deemed first to have been redelivered to the Owners). No memorandum of agreement will be entered into between the parties for the delivery of the Vessel from the Owners to the Charterers. In case a financier is involved in the transaction from Charterers’ side, Owners, Charterers and Charterers’ financier shall agree a closing memo which will describe the closing mechanics, including but not limited to the remittance of the Purchase Option Price and its release to Owners.

The Charterers shall accept the Vessel on an "AS IS, WHERE IS" basis and the Owners shall, take such steps to obtain and furnish such documents and take such other actions as the Charterers may reasonably request in order to facilitate the sale and re-registration of the Vessel under such flag as the Charterers may designate.

With respect to such sale, the Owners warrant that the Vessel at such sale shall be free of any encumbrances, debts, mortgages and maritime liens whatsoever and that the Owners have not committed any act or omission which would impair title to the Vessel and Owners hereby agree to indemnify and hold harmless Charterers in respect of any and all damages, costs and expenses whatsoever resulting from any breach of such warranty.

Upon completion of such purchase of the Vessel, the Charter and all further rights and obligations of the parties hereunder (except for indemnities and other obligations that by their nature should survive the termination of this Charter) shall terminate.

Reasonable and documented registration cost, and bank related costs including lifting charge and escrow agent fees, if any, shall be for the Charterer’s account; however such cost not to exceed USD 10,000.


The clause 7 (Surveys on Delivery and Redelivery), clause 15 (Redelivery), clause 36 (Inspection on re-delivery of the Vessel), and clause 37 (Familiarisation) shall not apply if the Charterers exercise this Purchase Option.

In case Charterers do not exercise their Purchase Option, painting and re-painting, instalment and re-instalment, registration and re-registration at redelivery, if required by the Owners, shall be at the Charterers’ expense and time.

Owners’ Put Option
 
In case the Charter Period is extended pursuant to Addendum No.1 and Charterers do not provide the Owners with the Purchase Option Notice at least ninety (90) days before the expiration of the Charter Period, Owners are entitled to exercise their Put Option pursuant to which Charterers should purchase the Vessel from Owners for an amount of USD 6,545,424 (the "Put Option Price") at the last day of the Charter Period.

The Owners must give a minimum of sixty (60) days' written notice of their intention to exercise the Put Option. The Put Option Price shall be paid to the Owners upon delivery of the Vessel. The Vessel shall be delivered to the Charterers at the last day of the Charter Period and Owners undertake to render the necessary assistance in order to achieve this. Once the Put Option has been exercised by Owners, they may not withdraw same.

The Owners agree (at the cost of the Charterers) to enter into (i) a bill of sale and (ii) a protocol of delivery and acceptance, and the Vessel shall accordingly be deemed delivered to the Charterers on the date and time set out in such protocol of delivery and acceptance (and to the extent required for such purposes the Vessel shall be deemed first to have been redelivered to the Owners). No memorandum of agreement will be entered into between the parties for the delivery of the Vessel from the Owners to the Charterers. In case a financier is involved in the transaction from Charterers’ side, Owners, Charterers and Charterers’ financier shall agree a closing memo which will describe the closing mechanics, including but not limited to the remittance of the Put Option Price and its release to Owners.

The Charterers shall accept the Vessel on an "AS IS, WHERE IS" basis and the Owners shall, take such steps to obtain and furnish such documents and take such other actions as the Charterers may reasonably request in order to facilitate the sale and re-registration of the Vessel under such flag as the Charterers may designate.

With respect to such sale, the Owners warrant that the Vessel at such sale shall be free of any encumbrances, debts, mortgages and maritime liens whatsoever and that the Owners have not committed any act or omission which would impair title to the Vessel and Owners hereby agree to indemnify and hold harmless Charterers in respect of any and all damages, costs and expenses whatsoever resulting from any breach of such warranty.

Upon completion of such purchase of the Vessel as set out in this Clause 41, the Charter and all further rights and obligations of the parties hereunder (except for indemnities and other obligations that by their nature should survive the termination of this Charter) shall terminate.

Reasonable and documented registration cost, and bank related costs including lifting charge and escrow agent fees, if any, shall be for the Charterer’s account; however such cost not to exceed USD 10,000.

The clause 7 (Surveys on Delivery and Redelivery), clause 15 (Redelivery), clause 36 (Inspection on re-delivery of the Vessel), and clause 37 (Familiarisation) shall not apply if the Owners exercise this Put Option.


In case Owners do not exercise their Put Option, painting and re-painting, instalment and re-instalment, registration and re-registration at redelivery, if required by the Owners, shall be at the Charterers’ expense and time.

Termination (Clause 28)
 
Parties agreed to add the Subclause 28(a) (iv) of the Charter as follows;

In the event of a termination as aforesaid, the Charterers shall be entitled to exercise the Purchase Option set out in Addendum No. 2 within thirty (30) Banking Days from receipt of Owners' written notice of termination. If such Purchase Option is exercised within the due date, this Charter Party shall continue in full force and effect until the successful completion of the sale of the Vessel pursuant to the Purchase Option at which point in time any default (except for any outstanding payment following a default under clause 28(a)(i)) shall be deemed cured with no further rights or obligations between the parties.

Otherwise, all other terms and conditions of the Charter with Addenda shall remain unaltered and in full force and effect.

 
Onishi Kaiun Co., Ltd.
Signature (Owner)
 
/s/ Shotaro Onishi
 
Name: Shotaro Onishi
Title: Director
  
Synthesea Maritime Co.
Signature (Charterer)
 
/s/ Stavros Gyftakis
 
Name: Stavros Gyftakis
Title: Director
 
Ocean West Shipping S.A.
Signature (Owner)
 
/s/ Shotaro Onishi
 
 
Name: Shotaro Onishi
Title: Director/Secretary
    


Appendix A:

   
(in USD)
(in USD)
    
(in USD)
(in USD)
　
　
Purchase
Option Price
Purchase Price
in case of
Owners` Default
　
　
Purchase
Option Price
Purchase Price
in case of
Owners` Default
1st Year
1st Month
N/A
17,863,636.00
2nd Year
13th Month
N/A
16,227,268.00
1st Year
2nd Month
N/A
17,727,272.00
2nd Year
14th Month
N/A
16,090,904.00
1st Year
3rd Month
N/A
17,590,908.00
2nd Year
15th Month
N/A
15,954,540.00
1st Year
4th Month
N/A
17,454,544.00
2nd Year
16th Month
N/A
15,818,176.00
1st Year
5th Month
N/A
17,318,180.00
2nd Year
17th Month
N/A
15,681,812.00
1st Year
6th Month
N/A
17,181,816.00
2nd Year
18th Month
N/A
15,545,448.00
1st Year
7th Month
N/A
17,045,452.00
2nd Year
19th Month
N/A
15,409,084.00
1st Year
8th Month
N/A
16,909,088.00
2nd Year
20th Month
N/A
15,272,720.00
1st Year
9th Month
N/A
16,772,724.00
2nd Year
21st Month
N/A
15,136,356.00
1st Year
10th Month
N/A
16,636,360.00
2nd Year
22nd Month
N/A
14,999,992.00
1st Year
11th Month
N/A
16,499,996.00
2nd Year
23rd Month
N/A
14,863,628.00
1st Year
12th Month
N/A
16,363,632.00
2nd Year
24th Month
N/A
14,727,264.00
3rd Year
25th Month
15,028,627.00
14,590,900.00
4th Year
37th Month
13,278,395.30
12,954,532.00
3rd Year
26th Month
14,888,172.08
14,454,536.00
4th Year
38th Month
13,138,622.20
12,818,168.00
3rd Year
27th Month
14,747,717.16
14,318,172.00
4th Year
39th Month
12,998,849.10
12,681,804.00
3rd Year
28th Month
14,607,262.24
14,181,808.00
4th Year
40th Month
12,859,076.00
12,545,440.00
3rd Year
29th Month
14,466,807.32
14,045,444.00
4th Year
41st Month
12,719,302.90
12,409,076.00
3rd Year
30th Month
14,326,352.40
13,909,080.00
4th Year
42nd Month
12,579,529.80
12,272,712.00
3rd Year
31st Month
14,185,897.48
13,772,716.00
4th Year
43rd Month
12,439,756.70
12,136,348.00
3rd Year
32nd Month
14,045,442.56
13,636,352.00
4th Year
44th Month
12,299,983.60
11,999,984.00
3rd Year
33rd Month
13,904,987.64
13,499,988.00
4th Year
45th Month
12,160,210.50
11,863,620.00
3rd Year
34th Month
13,764,532.72
13,363,624.00
4th Year
46th Month
12,020,437.40
11,727,256.00
3rd Year
35th Month
13,624,077.80
13,227,260.00
4th Year
47th Month
11,880,664.30
11,590,892.00
3rd Year
36th Month
13,483,622.88
13,090,896.00
4th Year
48th Month
11,740,891.20
11,454,528.00
5th Year
49th Month
11,544,527.28
11,318,164.00
6th Year
61st Month
9,827,022.94
9,681,796.00
5th Year
50th Month
11,405,436.00
11,181,800.00
6th Year
62nd Month
9,688,613.48
9,545,432.00
5th Year
51st Month
11,266,344.72
11,045,436.00
6th Year
63rd Month
9,550,204.02
9,409,068.00
5th Year
52nd Month
11,127,253.44
10,909,072.00
6th Year
64th Month
9,411,794.56
9,272,704.00
5th Year
53rd Month
10,988,162.16
10,772,708.00
6th Year
65th Month
9,273,385.10
9,136,340.00
5th Year
54th Month
10,849,070.88
10,636,344.00
6th Year
66th Month
9,134,975.64
8,999,976.00
5th Year
55th Month
10,709,979.60
10,499,980.00
6th Year
67th Month
8,996,566.18
8,863,612.00
5th Year
56th Month
10,570,888.32
10,363,616.00
6th Year
68th Month
8,858,156.72
8,727,248.00
5th Year
57th Month
10,431,797.04
10,227,252.00
6th Year
69th Month
8,719,747.26
8,590,884.00
5th Year
58th Month
10,292,705.76
10,090,888.00
6th Year
70th Month
8,581,337.80
8,454,520.00
5th Year
59th Month
10,153,614.48
9,954,524.00
6th Year
71st Month
8,442,928.34
8,318,156.00
5th Year
60th Month
10,014,523.20
9,818,160.00
6th Year
72nd Month
8,304,518.88
8,181,792.00
7th Year
73rd Month
8,085,655.14
8,045,428.00
　
　
　
　
7th Year
74th Month
7,948,609.32
7,909,064.00
　
　
　
　
7th Year
75th Month
7,811,563.50
7,772,700.00
　
　
　
　
7th Year
76th Month
7,674,517.68
7,636,336.00
　
　
　
　
7th Year
77th Month
7,537,471.86
7,499,972.00
　
　
　
　
7th Year
78th Month
7,400,426.04
7,363,608.00
　
　
　
　
7th Year
79th Month
7,263,380.22
7,227,244.00
　
　
　
　
7th Year
80th Month
7,126,334.40
7,090,880.00
　
　
　
　
7th Year
81st Month
6,989,288.58
6,954,516.00
　
　
　
　
7th Year
82nd Month
6,852,242.76
6,818,152.00
　
　
　
　
7th Year
83rd Month
6,715,196.94
6,681,788.00
　
　
　
　
7th Year
84th Month
6,545,424.00
6,545,424.00
　
　
　
　


EX-4.35 11 ef20039046_ex4-35.htm EXHIBIT 4.35
Exhibit 4.35

Date : 24th July 2024
To:
Onishi Kaiun Co., Ltd.
 
Daito Shoji Bldg. 6F, 1-13-4, Katsuyama-cho, Matsuyama-city, Ehime, 790-0001, Japan
   
 
OCEAN WEST SHIPPING S.A.
 
c/o Onishi Kaiun Co., Ltd.
 
Daito Shoji Bldg. 6F, 1-13-4, Katsuyama-cho, Matsuyama-city, Ehime, 790-0001, Japan
 
(collectively, the “Owners”)

Dear Sirs,
GUARANTEE

In consideration of the entry into by you of a Memorandum of Agreement (hereinafter called the “MOA”) dated 24th July 2024, with Synthesea Maritime Co. as sellers (hereinafter called “Synthesea Maritime”) for the sale and purchase of the motor vessel “Ikan Kerapu” tbr "Synthesea" with IMO number 9697959 (hereinafter called the “Vessel”) and a Bareboat Charter Party (hereinafter called the “BBCP”) dated 24th July 2024, with Synthesea Maritime as charterers for the bareboat chartering of the Vessel, we, the undersigned, as the primary obligor, guarantee to you and your successors and assignees the due and punctual performance by Synthesea Maritime of all its liabilities, obligations and responsibilities under the MOA and the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto.

If, at any time, default is made by Synthesea Maritime in the performance and/or observance of any term, provision, condition, obligation or agreement, or in any other matter or thing pertaining to the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto, or in the payment of any sums payable pursuant thereto which are to be complied with by Synthesea Maritime, its successors or assignees, then we will perform, or cause to be so performed, all terms, provisions, conditions, obligations and agreements contained in the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto, and will pay, as our own debt and within five (5) Banking Days (as defined in the BBCP) on demand, any sum that is due and payable in consequence of the non-performance by Synthesea Maritime, its successors and assignees, of any of the said terms, provisions, conditions, obligations and agreements.


Any demand made by the Owners under this guarantee shall be made in writing signed by an authorized signatory of the Owners and shall specify the default of Synthesea Maritime and shall be accompanied by a copy of the notice of such default served on Synthesea Maritime by the Owners together with a statement (if any) that Synthesea Maritime have failed to remedy such default within any applicable grace period.

We hereby irrevocably and unconditionally agree to indemnify you on demand and keep you indemnified against all costs, expenses, claims, liabilities, and fees (including, but not limited to, reasonable and documented legal fees) and taxes thereon suffered or incurred by you, directly as a result of any breach or non-performance of, or non-compliance by Synthesea Maritime with, any of its obligations under or pursuant to the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto, or as a result of any of those obligations being or becoming void, voidable or unenforceable.

The undersigned hereby affirm and consent to any and all amendments, changes or modifications to be hereafter made to the MOA or BBCP without requesting any further notice and without such amendments, changes or modifications in any way affecting, changing or releasing us from our obligations given under this guarantee.

We hereby represent, warrant and undertake, that:


 a)
We have full power, authority and capacity to enter into and perform our obligations under this guarantee and have taken all necessary corporate or other action (as the case may be) required to enable us to do so and our entry into of this guarantee will not exceed any power in our constitutional documents;

b)
This guarantee constitutes valid and legally binding obligations of us enforceable in accordance with its terms;

c)
All consents, licenses, approvals and authorizations of governmental authorities and agencies required to make this guarantee valid, enforceable and admissible in evidence and to authorize and permit the execution, delivery and performance of this guarantee by us have been obtained or made and will remain in full force and effect and there has been no default in the observance of any of the terms or conditions of any of them;



d)
We have not taken nor received, and undertake that until all the obligations of Synthesea Maritime under the MOA or the BBCP, and any supplements, amendments, changes or modifications hereafter made thereto have been paid or discharged in full we will not take or receive, the benefit of any security from Synthesea Maritime or any other person in respect of our obligations under this guarantee;

e)
We will inform you of any occurrence of which we become aware which might adversely affect the ability of us to perform our obligations under this guarantee and will from time to time, if so reasonably requested by you, confirm to you in writing that, save as otherwise stated in such confirmation, no event of default under the BBCP has occurred and is continuing; and

f)
We will not assign or transfer any of our rights or obligations under this guarantee.

This guarantee:


 a)
shall become effective upon signing of the MOA and BBCP and shall only become null and void upon the fulfillment of all obligations of Synthesea Maritime under the MOA and BBCP whereafter this guarantee shall be immediately returned to us;

b)
shall be in addition to, and shall not be prejudiced or affected by, any other security for the obligations of Synthesea Maritime which may be from time to time held by you; and

c)
shall not be discharged or prejudiced by the liquidation, bankruptcy or dissolution (or proceedings analogous thereto) of Synthesea Maritime or the appointment of a receiver or administrative receiver or administrator or trustee or similar officer of any of the assets of Synthesea Maritime or any term or concessions given by you to Synthesea Maritime or any other party, or, subject to applicable limitation periods, by anything which you may do or omit to do or by any other dealing or thing whatsoever which but for the provisions of this paragraph might operate to discharge us from liability.

The provisions of clause 31 (Notices) of the BBCP shall apply (mutatis mutandis) to this guarantee.

This guarantee, and all rights and obligations arising hereunder shall be governed by and construed and determined and may be enforced in accordance with the Laws of England.


Any dispute arising out of in connection with this guarantee shall be referred to arbitration in London in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect to the provisions of this clause.

The arbitration shall be conducted under and in accordance with London Maritime Arbitrator Association (L.M.A.A.) terms and conditions current at the time when the arbitration proceedings are commenced.

The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator and send notice of such appointment in writing to the other party requiring the other party to appoint its own arbitrator within 14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own arbitrator and give notice that it has done so within the 14 days specified, the party referring a dispute to arbitration may, without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement. Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole arbitrator.

In cases where neither the claim nor any counterclaim exceeds the sum of US$200,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the LMAA Small Claims Procedure current at the time when the arbitration proceedings are commenced.

For and on behalf of
United Maritime Corporation (as the “Guarantor”)

/s/ Stavros Gyftakis
    

   
     
Name: Stavros Gyftakis
  
Title: Chief Financial Officer/ Director
  


EX-4.36 12 ef20039046_ex4-36.htm EXHIBIT 4.36
Exhibit 4.36

SHAREHOLDERS' AGREEMENT

Relating to the shareholding in RGI Marine Holding AS


Table of content
 
1.
General objective
 4
     
2.
The Board
4
     
3.
Loyalty undertaking
5
     
4.
Equal treatment
6
     
5.
Voting rules and general meetings
6
     
6.
Management services
6
     
7.
Funding structure and dilution schedule
6
     
8.
Transfer of Shares
7
     
9.
Determination of Fair Market Value
11
     
10.
Accession
11
     
11.
Miscellaneous
12
     
12.
Default
13
     
13.
Dividend Policy
14
     
14.
Amendments and termination
14
     
15.
Governing law and jurisdiction
14

Annexes:
 
 
 1.
Form of accession document
 
 2.
Copy of subscription agreement

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This shareholders' agreement (this "Agreement") is entered into on 31 July 2024 by and between:

  (1)
RGI Marine Limited., a private limited company duly incorporated under the laws of England and Wales with business reg. no.  1332 1268 ("RGI");
 
  (2)
Steady Offshore Shipping Pte Ltd, a company duly incorporated under the laws of Singapore, with business reg. no. 198105925N;
 
  (3)
United Maritime Corporation, a company duly incorporated under the laws of the Republic of the Marshall Islands, with business reg. no. 112801;
 
  (4)
Karean AS, a company duly incorporated under the laws of Norway, with business reg. no. 989 009 583; and
 
  (5)
Mr Jonathan Elkington, a British citizen born on [                   ], with passport number [                       ]
 
 

((2) to (5) shall be referred to herein as the “Investors”).
 
Each party to this Agreement is referred to herein as a "Party" or "Shareholder" and jointly as the "Parties" or "Shareholders".
 
WHEREAS
 
  (A)
RGI Marine Holding AS is a private limited liability company duly incorporated under the laws of Norway, registered with entity registration number 933 582 361 and registered address at Tjuvholmen allé 1, 0252 Oslo, Norway (hereinafter referred to as the "Company").
 
  (B)
The Parties intend to manage the Company with the general objective of maximising the value of the Company. The Parties have entered into this Agreement to regulate certain shareholder rights as well as certain other aspects among the Parties as owners of shares in the Company, including relating to transfer of shares and a prospective Exit.
 
NOW, THEREFORE, in consideration of the foregoing, the Parties hereby agree as follows:

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1.
General objective
 
The objective of the Company, a commercial entity within the shipping industry, is amongst other to actively manage and operate the Investors' investment in Wind Energy Construction AS ("NWEC"). The objective of NWEC is to facilitate for the construction of an energy construction vessel to be owned by NWEC, and to facilitate the sale of the vessel (directly or indirectly) during or after construction (the "Purpose"). In relation to NWEC, the Company will thus serve as a coordination point for the Investors, ensuring their strategic and commercial interests are safeguarded in the realisation of the Purpose. This includes actively overseeing NWEC's adherence to its Purpose through the Investors' engagement in strategic and commercial decision-making within NEWC, inter alia, related to project financing and marketing strategies, for the vessel.

The Company shall be managed with the general objective of creating maximum value for its shareholders with a perspective of an exit based on the business plan and the business concept, and otherwise in accordance with this Agreement and applicable law.
 
2.
The Board
 
2.1
Composition of the Board
The board of directors of the Company (the "Board") shall have up to 5 board members.

RGI shall have the right to appoint two board members with personal alternate (Norw.: varamedlem). All Shareholders holding more than 10% shall have the right to appoint one board member each with personal alternate.

The remaining board member(s) shall be elected by the general meeting.

RGI shall have the right to appoint the chair of the Board.

In the event that a member of the Board wishes to resign, or RGI for other reasons wishes to replace a member of the Board nominated by it, the Parties and the Board shall cause that a general meeting is held immediately with the view to elect a new member of the Board.
 
2.2
Board meetings
Except as the board members may otherwise agree from time to time or as required by law, meetings of the Board shall be called by no less than 5 business days’ prior written notice to each board member; provided, however, that such notice may be waived at any time by a board member with respect only to such board member. The notice shall state the place, date, time and agenda of such meeting.

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The Board may only resolve matters that have been specifically identified in the notice for the relevant board meeting unless each of the board members otherwise explicitly agrees in writing.

The Board shall, where possible and reasonable, try to reach an unanimous decision on all material matters considered by the Board. If no unanimous decision can be made, the matter shall, unless another majority of votes is provided for by law, or the Company’s articles of association, be decided by a simple majority of votes, save that any of the following decisions require approval by all directors nominated and appointed to the Board by a Shareholder holding more than 35% of the shares in the Company:


 a)
the decision to sell and/or otherwise transfer any of the Company's shares in NWEC (including such a sale as regulated in clause 5(a) below);

b)
the decision to approve a transfer of shares in the Company;

c)
the decision to obtain external financing or other form of capital / fund raising;

d)
any decision that materially deviates from the Purpose;

e)
any approval of transactions or agreements between the Company and related parties in accordance with section 3-8 of the Companies Act;

f)
any private placements, mergers and other restructuring that changes the ownership composition;

g)
any decision to propose payment of dividends or other distributions of capital to shareholders;

h)
any proposal to dissolve the Company (including in the case of clause 5(b) below).

Similarly, any resolutions at any general meeting related to any of the aforementioned matter also requires the approval of each Shareholder holding more than 35% of the shares in the Company.
 
3.
Loyalty undertaking
 
The Shareholders undertake to act loyally and true in respect of the provisions and the intent of this Agreement, including without limitation with regard to voting in accordance with the provisions of this Agreement in general meetings in the Company in order to give this Agreement full force and effect, and to ensure that the Board complies with the provisions hereof. The Shareholders undertake to execute and perform all such further documents, agreement, act and things as may reasonably be required to carry out the provisions and Purpose of this Agreement.

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4.
Equal treatment
 
Each of the Shareholders shall be treated equally in proportion to their shareholding in the Company, unless otherwise explicitly set forth in this Agreement.
 
5.
Voting rules and general meetings
 
Each share in the Company ("Share") shall have one vote in general meetings. The Parties commit to attend all general meetings unless prevented by special circumstances. Attendance can as well be via video- or teleconference. The Investors undertake to vote in favour of the following resolution in the case that such resolution is proposed by the Board to be made by the general meeting of the Company:

 (a)
The sale of 100 % of the shares held by the Company in NWEC; and
 

 (b)
In the case of a sale as stipulated in section (A) above, and if proposed by the Board, the resolution to dissolve the Company.
 
6.
Management services
 
The Company has entered into a management agreement ("Management Agreement") with RGI, pursuant to which RGI is responsible for the corporate, technical, and commercial management of the Company. The specific terms and conditions of the Management Agreement is set out in the Management Agreement.
 
7.
Funding structure and dilution schedule
 
As of the date of signing this Agreement (the "Effective Date"), RGI owns 100% of the Shares (the "Original Shares"). Each Investor has committed to subscribe for shares under the terms outlined in a subscription agreement (a copy of which is attached hereto) (the "Subscription Agreement"), signed on or around the Effective Date.

Upon each call of capital based on the Subscription Agreement, RGI's ownership will be diluted as detailed in the cap table attached to the Subscription Agreement (the "Cap Table"). As evident from the Cap Table additional capital is required from new investors for completion of the Vessel. RGI shall use best efforts to secure a parent company guarantee from either RGI or new investors to ensure that the Company meets its obligation in accordance with the NWEC Subscription Agreement, clause 7 within 13 September 2024. It is understood that the failure by RGI to secure the parent company guarantee, despite the exercise of its best efforts, does not amount to a default of the Agreement. RGI is responsible for securing additional capital from either RGI, existing Shareholders or new investors, if and when required to meet the Company's obligations under the NWEC Subscription Agreement.

6 / 18
The additional capital required as set out in the Cap Table and any additional capital required to complete the Vessel will be raised in accordance with the Companies Act, unless otherwise set out in this Agreement or the Subscription Agreement. The Investors may subscribe for shares on equal terms with new investors, either alongside new investors or alternatively to new investors.
 
8.
Transfer of Shares
 
8.1
General
Any and all transfers of Shares (a "Transfer") shall be subject to the rights, obligations and restrictions set out in this Agreement.

Any Transfer of Shares by a Party made otherwise as permitted by this Agreement shall not be permitted and be void. In case of any conflict between this Agreement and the Company's articles of association, the provisions set out in this Agreement shall prevail.

Clause 8.3 (Right of first refusal) and Clause 6.6 (Tag-along) shall not apply to Transfers by any of the Parties to any company or other legal entity directly or indirectly controlled by or under common control with a Party through ownership interests of 100% or through control over 100% of the votes.
 
8.2
Approval from the Board
Any Transfer is subject to the written approval of the Board in accordance with the Norwegian Private Limited Liability Companies Act (Norw.: aksjeloven) (the "Companies Act") such approval not to be unreasonably withheld or delayed.
 
8.3
Right of first refusal
In the event of a Transfer, or if shares in any other way change owner, the Shareholders shall have pre-emption right (right of first refusal) on a pro rata basis to purchase the relevant Shares in accordance with the provisions as follows:


 (a)
If a Shareholder has entered into an agreement to transfer all or any of its Shares (the "Selling Shareholder"), it shall provide the other Shareholders (the "Non-Selling Shareholders") with a transfer notice (the "Transfer Notice"), which notice shall identify (i) the name and address of the proposed transferee, (ii) the total number of Shares intended to be transferred and (iii) the intended form of consideration and the other material terms and conditions of the transfer.
 
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 (b)
The Non-Selling Shareholders shall, at any time within 30 days of the date of the Transfer Notice, have the right to purchase all, but not less than all, of the Shares to be transferred. The right shall be exercised by a written notice to the Selling Shareholder (the "Exercise Notice").
 

 (c)
If the Non-Selling Shareholders elects to exercise their right of first refusal, they shall, in the event of a proposed transfer based on a bona fide purchase offer on arm’s length conditions, purchase the Shares at the same price and on the same terms and conditions as in the Transfer Notice. If the consideration in the offer is not cash, the consideration payable by such Shareholders shall be equal to the Fair Market Value of such consideration. In the event of a Transfers not being on arm’s length terms and conditions, or if the purchase price cannot be precisely determined based on the Transfer Notice, the purchase price payable by the Non-Selling Shareholders shall be equal to the estimated Fair Market Value of the Shares to be disposed of, at the time when the Exercise Notice was given.
 

 (d)
Non-Selling Shareholders that have given an Exercise Notice, are obliged to acquire all of the Shares covered by the Transfer Notice. If more than one Non-Selling Shareholder have given an Exercise Notice, the Shares shall be allocated between them pro rata to the number of Shares already held by such Non-Selling Shareholders.
 

 (e)
Transfers between the Shareholders shall not trigger right of first refusal.
 

 (f)
This Clause 8.3 shall also apply upon transfers (by way of sale, demerger, merger or similar transactions) of a majority of the shares/interests or a controlling interest in a Shareholder.
 

 (g)
The pre-emption right (right of first refusal) as described above shall apply instead of the pre-emption right pursuant to section 4-19 to 4-23 of the Companies Act. In other respects, the rules of the Companies Act shall apply.
 
8.4
Purchase Offer
 
8.4.1
Purchase Offer
Notwithstanding Clause 8.3 (Right of first refusal), a Shareholder (the "Selling Shareholder") may at any time elect to present to the Non-Selling Shareholders a written offer (the "Purchase Offer") to purchase the Shares intended to be sold (the "Sales Shares") at a fixed purchase price (the "Offer Price"). For the avoidance of doubt: Two or all of the Shareholder may elect to present a joint Purchase Offer. The Purchase Offer shall contain the name of the prospective buyer(s) (the "Prospective Buyer(s)").

8 / 18
8.4.2
Purchase Right
The Purchase Offer shall constitute an irrevocable, non-assignable right for the Non-Selling Shareholders to purchase the Sales Shares for the Offer Price ("Purchase Right"), without any representations and warranties from the Selling Shareholder regarding the business operations of the Company. The Selling Shareholder will thus give only customary title and capacity warranties. The Purchase Right may only be exercised by the Non-Selling Shareholders for all the Sales Shares.
 
8.4.3
Term of Acceptance
Within one (1) month after receipt of the Purchase Offer ("Purchase Offer Term of Acceptance"), the Non-Selling Shareholders may, by written notice to the Selling Shareholder, exercise the Purchase Right.
 
8.4.4
Acceptance
If a Non-Selling Shareholder exercises its Purchase Right prior to the expiry of the Purchase Offer Term of Acceptance, the sale shall be executed not later than two (2) months after expiry of the Purchase Offer Term of Acceptance. If more than one Non-Selling Shareholder have accepted the Purchase Offer, the Sale Shares shall be allocated between them pro rata to the number of Shares already held by such Non-Selling Shareholders.
 
8.4.5
Sale to the Prospective Buyer(s)
If none of the Non-Selling Shareholder exercises their Purchase Right prior to the expiry of the Purchase Offer Term of Acceptance, the Purchase Right expires simultaneously with the expiry of the Purchase Offer Term of Acceptance, and the Selling Shareholder may within a period of six (6) months after the expiry of the Purchase Offer Term of Acceptance, sell the Sale Shares to the Prospective Buyer, however, provided that the sale is made for a consideration not lower than the Offer Price (as calculated on a valuation base for 100% of the Shares). For the avoidance of doubt: In such case, the right of first refusal set forth in Clause 8.3 shall not apply. The Non-Selling Shareholders shall be obliged to consent to the transfer of the Shares of the Selling Shareholder to the third party.
 
8.5
Drag-along
Should one or more Shareholders who jointly own at least 2/3 of the Shares (the "Selling Shareholders") propose to transfer, in any transaction or series of transactions, all of their Shares to an unrelated third party buyer, the Selling Shareholders have the right to require each of the other Shareholders to sell all of their Shares, at the same price and on the same terms and conditions as the Selling Shareholders (the "Drag-along Right"). The Drag-along Right is conditional upon the sale taking place on market terms and conditions.

9 / 18
The Drag-along Right shall be exercisable by written notice (the "Drag-along Notice") to the other Shareholders at least 30 days prior to the contemplated sale of Shares by the Selling Shareholders. Upon receipt of a Drag-along Notice, each Shareholder receiving such notice shall be obligated to sell its Shares to the transferee on the same terms and conditions as the Selling Shareholders, unless the Shareholders individually or jointly exercise their right of first refusal.
 
8.6
Tag-along
In the event that one or more of the Shareholders (the "Selling Shareholders") holding more than 50% of the Shares in the Company propose to transfer more than 50% of the Shares, then each other Shareholder shall have the right to sell a pro rata portion of its Shares equal to the portion of Shares such Selling Shareholders will sell, at the same price and on the same terms and conditions as the Selling Shareholders (the "Tag-along Right").

Any transfer by the Selling Shareholders, directly or indirectly, to the same acquirer within a one-year period shall be consolidated for the purpose of the Tag-along Right.

In case of any such proposed transfer the Selling Shareholders shall, in writing and at least 30 days prior to closing of the proposed transfer, notify all Shareholders having a Tag-along Right and the Board of any intended transfer and its terms and conditions (the "Selling Shareholders’ Notice").

The Selling Shareholders’ Notice shall include, without limitation, (i) the name and address of the proposed transferee, (ii) the total number of Shares proposed to be transferred and (iii) the proposed form of consideration and the other material terms and conditions of the transfer. The Selling Shareholders shall ensure that any Shareholder having a Tag-along Right shall have full access to all transaction documents relating to the proposed sale.

Within 14 days of the date of the Selling Shareholder Notice, each Shareholder that decides to exercise its Tag-along Right shall notify the Selling Shareholders in writing thereof (the "Tag-along Notice").

If the Selling Shareholders receive no Tag-along Notice within the 14-day period referred to above, the Selling Shareholders shall for a 30-day period beginning at the expiration of such 14-day period be entitled to transfer the number of Shares set out in the Selling Shareholder Notice on the terms and conditions stated therein. Any transfer of Shares subsequent to this 30-day period may only take place following a new Selling Shareholder Notice.

10 / 18
9.
Determination of Fair Market Value
 
Where the "Fair Market Value" of Shares is to be determined in accordance with this Agreement, the relevant Parties shall primarily attempt to agree on the Fair Market Value. If such agreement is not reached within a period of 20 business days, each relevant Party may require the Fair Market Value to be determined by a recognised Nordic investment bank (Norw.: verdipapirforetak) to be mutually appointed by the relevant Parties (the "Expert"). If the relevant Parties cannot agree on the choice of investment bank within 20 days thereafter, then the Expert shall be appointed by the managing board members of the Norwegian Securities Dealers Association (No. Verdipapirforetakenes Forbund) at the written request of any relevant Party. The Expert shall base its valuation on recognised principles for valuation of going concerns, without regard to any reduction of value caused by the ownership structure, including but not limited to minority discount (Norw.: minoritetsrabatt).

The Expert shall determine the Fair Market Value within 45 business days of its appointment and shall notify the relevant parties of their determination within one business day of the same. The fees and costs of the Expert shall be shared by the relevant Parties in proportion to how the dispute is settled among them.

The Expert shall act as an expert and not as an arbitrator, and its determination shall be final and binding on the relevant Parties (in the absence of manifest error, in which case the determination shall be void and shall be remitted to the Expert for correction.)

The Shareholders shall procure that the Expert has such (timely) access to the accounting records and other relevant documents and information of the Company and any group company as it may reasonably require.
 
10.
Accession
 
Any and all transfer and subscription of shares in the Company is subject to the prior written accession of the new shareholder to this Agreement, by way of signing an accession document in the form set out in Annex 1.

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11.
Miscellaneous
 
11.1
Agreement to prevail
If there is any conflict between the provisions of this Agreement and the articles of association, the provisions of this Agreement shall, to the extent permitted by law, prevail.
 
11.2
Severability
If any provision or part-provision of this Agreement is or becomes invalid, illegal or unenforceable, it shall be deemed modified to the minimum extent necessary to make it valid, legal and enforceable. If such modification is not possible, the invalid provision shall be interpreted or replaced by a provision aiming to achieve the purpose of the original provision.
 
11.3
Confidentiality
The Parties and their representatives undertake to keep total confidentiality and secrecy about this Agreement and about the Company’s operations, except for matters which are publicly known or available, or which evidently are of a non-confidential nature. Furthermore, the Parties undertake to keep absolute confidentiality and secrecy of all personal, financial, legal, market and other business-related matters concerning the other Parties with whom they get acquainted in connection with this Agreement and the joint ownership in the Company. The obligation of confidentiality and secrecy also applies after the Shares have been transferred to a new owner and after the expiry of this Agreement.

12 / 18
12.
Default
 
12.1
In the event of material default by a Shareholder, the other Shareholders may send a written notice to the Shareholder in question stating that the Shareholder is in material default under this Agreement and that the default must be rectified as soon as possible and no later than 30 (thirty) days after receipt of the default notice (the "Default Notice"). The Shareholder sending the Default Notice shall send a copy of the Default Notice to all other Shareholders.
 
12.2
If the default has not been fully rectified, or is unable to be fully rectified, within 30 (thirty) calendar days after the relevant Shareholder's receipt of the Default Notice, the other Shareholders shall, on a pro rata basis according to their shareholding in the Company, have the right to purchase all the Shares held by the defaulting Party (the "Default Shares"), free and clear of any encumbrances, at a price per share equal to 90% of the Fair Market Value of such Shares. The right to acquire the Default Shares must be exercised by written notice to the defaulting Shareholder within 60 (sixty) days after the date of the Default Notice. The non-defaulting Shareholders may in addition claim compensation pursuant to Clause 12.4.
 
12.3
In the event RGI fails to satisfy its obligations in the Agreement, Clause 7 to secure additional capital from either RGI, existing Shareholders or new investors, the other Shareholders have the right, in their option, to either (i) on a pro rata basis according to their shareholding in the Company (RGI's shareholding to be disregarded when calculating of the other Shareholders' pro rata share) assume (Norw.: overta) the Original Shares from RGI without payment of any consideration, or (ii) require the Original Shares to be redeemed (Norw.: innløst) by the Company without any payment to RGI in connection with such redemption. This right must be exercised by written notice to RGI within 50 (fifty) days after the date notice of the failure to secure capital has been provided to RGI by the other Shareholders. It is understood that the rights afforded to the other Shareholders as per this Clause 12.3 shall be the sole remedies available for the other Shareholders in case of the failure by RGI to secure additional capital in breach of the Agreement, Clause 7, and that no other claim can be brought against RGI on account of such failure.
 
12.4
In the event of breach of this Agreement by a Shareholder, the non-defaulting Shareholders may claim compensation from the defaulting Shareholder for any loss suffered or incurred as a result of the breach. Claim for compensation does not preclude any other remedy available by law or the non-defaulting Shareholders' rights pursuant to Clauses 12.1, 12.2 and 12.3.

13 / 18
13.
Dividend Policy
 
There shall be no dividend distribution from the Company as long as dividend distribution will be in violation of any financial covenant the Company has adhered to.

Subject to the Board’s determination that the Company have sufficient reserves, the Parties intend to procure that the Company’s dividend policy will be to distribute an amount equivalent to a minimum of 50 % of annual profit, provided such policy will maintain the Company within the range of financial covenants and within a reasonable level of leverage as measured by debt/EBITDA and debt/equity ratios.
 
14.
Amendments and termination
 
This Agreement may only be amended by written approval by all Shareholders.

This Agreement shall terminate in respect to a Shareholder transferring all its Shares in compliance with this Agreement when such transfer has been completed. This Agreement shall furthermore terminate upon (a) the occurrence of an Exit or (d) mutual agreement by the Shareholders. The termination of this Agreement, however, shall not release a Shareholder from any liability incurred by it by reason of breach of its obligations under this Agreement.
 
15.
Confidentiality

This Agreement including all negotiations and written correspondence shall remain strictly confidential between the Parties, their financiers/banks, external counsels and auditors provided however that the Parties may disclose as much as may be necessary of the terms of this Agreement and relevant documentation to their auditors, managers, legal counsels, accountants, affiliates and as otherwise may be required by applicable laws or regulations, including but not limited to any stock exchange and/or securities and exchange commission laws and regulations. Any report or release or publication relating to this Agreement shall not be grounds for the Parties to withdraw from their obligations under this Agreement. Press releases or reports as required by stock exchange rules and regulations are allowed.
 
16.
Governing law and jurisdiction
 
16.1
Governing law

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16.2
Jurisdiction
This Agreement shall be governed by the laws of Norway Any dispute, controversy or claim arising out of or in connection with this Agreement, or the breach, termination or invalidity thereof, and which is not settled by mutual agreement, shall be referred to arbitration in Oslo, Norway, in accordance with the Norwegian Arbitration Act (Norw.: voldgiftsloven). The arbitration proceedings and the arbitration award shall be kept strictly confidential. The arbitration shall be conducted in English.
* * * *
[Signature Page follows.]

15 / 18
RGI Marine Limited
Steady Offshore Shipping Pre Ltd
   
/s/ Bartholomew Richard Fairclough
  /s/ Kuang Shihao
           
Name: Bartholomew Richard Fairclough
Name: Kuang Shihao
Title: Chairman
Title: Chairman

United Maritime Corporation
Karean AS
   
/s/ Stavros Gyftakis
/s/ Anders Engeset
           
Name: Stavros Gyftakis
Name: Anders Engeset
Title: CFO / Director
Title: Chairman

 
Mr Jonathan Elkington
  
     
 
/s/ Jonathan Elkington
  
         

16 / 18
Annex 1

DEED OF ADHERENCE

In connection with [company name] having subscribed/acquired [number] shares in RGI Marine Holding AS (the "Company"), the undersigned hereby agrees to be bound by the terms of the shareholders’ agreement dated [date] in respect of the Company (the "Shareholders’ Agreement"), after having read and fully understood the rights and obligations pertaining to it.

Any notice, request, instruction or other document to be delivered to the undersigned in connection with the Shareholders’ Agreement should be delivered to the undersigned at the address set forth below:

For and on behalf of [company name]
     
       
name:
  
name:
title:
  
title:
date:
  
date:

17 / 18
Annex 2

Copy of subscription agreement


18 / 18
EX-4.37 13 ef20039046_ex4-37.htm EXHIBIT 4.37
Exhibit 4.37

SUBSCRIPTION AGREEMENT

Relating to investments in RGI Marine Holding AS, reg.no. 933 582 361


Table of content

1.
BACKGROUND
3
     
2.
DEFINITIONS AND INTERPRETATION
3
     
3.
THE INVESTMENT
4
     
4.
GUARANTEE OBLIGATIONS
5
     
5.
ACTIONS PENDING CLOSING
6
     
6.
CLOSING
6
     
7.
ACCESSION
7
     
8.
SEVERAL AND NOT JOINT LIABILITY
7
     
9.
MISCELLANEOUS
7
     
10.
GOVERNING LAW AND JURISDICTION
8

2 / 10
This Subscription Agreement (this “Agreement”) is dated 31 July 2024 (the “Effective Date”) and made between:
 
(1)
RGI Marine Ltd. a private company duly incorporated under the laws of England and Wales, with business reg. no. 1332 1268 (“RGI”);
 
(2)
Steady Offshore Shipping Pte Ltd, a company duly incorporated under the laws of Singapore, with business reg. no. 198105925N;
 
(3)
United Maritime Corporation, a company duly incorporated under the laws of the Republic of the Marshall Islands, with business reg. no. 112801;
 
(4)
Karean AS, a company duly incorporated under the laws of Norway, with business reg. no. 989 009 583; and
 
(5)
Mr Jonathan Elkington, a British citizen born on [                      ], with passport number [                      ]
 
((2) to (5) shall be referred to herein as the “Investors”).
 
RGI Marine Holding AS, a company duly incorporated under the laws of Norway, with business reg. no. 933 582 361 (the “Company”).
 
The Company and the Investors are hereinafter jointly referred to as the “Parties” and individually as a “Party”.
 
1.
BACKGROUND
 
As at the date of this Agreement, the Company is a pre-registered shelf company with no activity, legally and beneficially owned by RGI.

Concurrently with entering into this Agreement, the Investors and the Company have entered into a shareholders' agreement relating to the ownership in the Company (the “Shareholders’ Agreement”).

The Parties wish to carry out the Investment (as defined further below) on the terms and subject to the conditions set out in this Agreement.
 
2.
DEFINITIONS AND INTERPRETATION
 
Unless otherwise defined herein, capitalized terms used in this Agreement shall have the following meanings:

Cap Table
means the table outlining the capital structure of the Company at each Closing as set out in Schedule 1;
   
Closing
means each of Closing 1 and each Subsequent Closing;

3 / 10
Closing 1
means the initial subscription of Shares and payment of subscription amount as set out in the Cap Table;
   
Consideration Shares
The shares to be issued to the Investors as set out in the Cap Table;
   
Investment
means the subscription for Shares as contemplated by this Agreement including the Cap Table;
   
Shares
means shares in the Company with a nominal value of NOK 0,0171428571428571 each;
   
Shareholders’ Agreement
means the shareholders’ agreement in respect of the Company, in the agreed form as appended to this Agreement as Schedule 2;
   
Subsequent Closing
means completion of each subscription for Shares by the Investors in accordance with the Cap Table other than Closing 1;

3.
THE INVESTMENT
 
3.1
General
The Parties have agreed that the Investors shall make an investment in the Company of a total of up to EUR 15,100,000 in cash (the "Investment") by way of subscription for new Shares. The objective of the Company, a commercial entity within the shipping industry, is amongst other to actively manage and operate the Investors' investment in Wind Energy Construction AS ("NWEC"). The objective of NWEC is to facilitate for the construction of one Energy Construction Vessel (the "Vessel") with Yard shipyard to be owned by NWEC, and to facilitate the sale of the Vessel (directly or indirectly) during or after construction (the "Purpose").

The proceeds from the Investment will be used to fulfil the Purpose. The Company will thus serve as a coordination point for the Investors, ensuring their strategic and commercial interests are safeguarded in the realisation of the Purpose. This includes actively overseeing NWEC's adherence to its Purpose through the Investors' engagement in strategic and commercial decision-making within NEWC, inter alia, related to project financing and marketing strategies, for the vessel.

3.2
Investment undertaking
Subject to the terms and conditions of this Agreement, the Investors will subscribe and pay for (in cash) the number of new Shares to be issued (the “Consideration Shares”) in the Company, for a total subscription amount of up to EUR 15,100,000 and the Investors will take any and all steps necessary to pass the board and general meeting resolutions required for the issue of the Consideration Shares exclusively to the Investors. The Consideration Shares shall be of the same class of Shares and carry the same rights as the existing Shares of the Company.

The allocation of Consideration Shares to each of the Investors and the timing of each Closing is set forth in the Cap Table.  If any additional capital is required, funds will be raised in accordance with the Companies Act. The Investors may subscribe for shares on equal terms with new investors, either alongside new investors or alternatively to new investors.

4 / 10
In the case that a guarantee as set out in section 4 cannot be provided, RGI shall seek to ensure that any new investors pursuant to this paragraph shall be able to provide the required guarantee as set out in section 4.

By signing this Agreement, the Parties, as relevant, waive, in respect of the transactions contemplated hereby, (i) any notice period for convening an extraordinary general meeting of the Company set out in the articles of association of the Company and/or the Norwegian Private Limited Companies Act (Norw: aksjeloven), (ii) any pre-emptive rights and (iii) any anti-dilution rights of any kind.

The Company undertakes that it shall convene any board meeting and call for any shareholders’ meeting to be held and take all actions necessary in order to effectuate all elements of the Investment.
 
3.3
The Share Issue
In the share issue (“Share Issue”), the share capital of the Company shall be increased in tranches as set out in the Cap Table.

The Share Issue will result in the number of Shares issued by the Company being increased from 1,750,000 with 15,100,000 to 16,850,000. The share capital of the Company will be increased by approx. NOK 258 857 from NOK 30,000 to approx. NOK 288,857.

The subscription rate for each Share in the Share Issue shall be EUR 1 per Consideration Share, of which approximately EUR 0,9983 will represent share premium.
 
4.
GUARANTEE OBLIGATIONS
 
The Parties acknowledge that the Company pursuant to the shipbuilding contract between NWEC and Vard shipyard, shall procure the issuance by the Parties or other investors a guarantee for the performance by NWEC of all its obligations towards Vard. The guarantee is limited to an amount equal to the CAP (as defined below) multiplied with the Company's shareholding percentage (direct or indirect) in NWEC, being a percentage of EUR 46.5m (the “CAP”). As of 13 September 2024, the percentage will be 45 %.

The guarantee shall be provided by the Parties or other investors in the Company by 13 September 2024, and each Party shall seek to fulfil the obligation to provide the guarantee. In the case that none of the Parties can provide the guarantee, RGI shall seek to attract another investor, as set out in section 3.2, to provide the guarantee

In the event the Company cannot provide the guarantee, the Company will remain owner of the shares in NWEC acquired prior to 13 September 2024.

Further, in the event the Company cannot provide the guarantee, the Company grants the other investors in NWEC (or other investor/investors jointly nominated by the other Investors) the right to invest in accordance with the investment structure for NWEC the Shares allocated to the Company if and when the Company does not fulfil its obligation to provide such guarantee.

5 / 10
5.
ACTIONS PENDING CLOSING
 
From the Effective Date and until Closing 1, the Company shall refrain from any action set forth below other than contemplated by this Agreement or with prior written consent by the Investors:

i.
Amending or modifying its governing documents;
 
ii.
Issuing, transferring, pledging or encumbering, or altering any right or obligation of, its Shares or options, warrants, convertible or exchangeable securities or other rights of any kind to acquire any share capital, equity or other capital in or of the Company;
 
iii.
declaring, setting aside or paying any dividend, contribution or other distribution with respect to its Shares or equity capital or otherwise to or in favour of its shareholders or affiliates;
 
iv.
entering into loan agreements, issuing any bond, note or other debt instrument or borrowing any money; and
 
v.
entering into any agreement or commitment to do any of the above.
 
6.
CLOSING
 
The Share Issue will be executed and given effect by the sequence of individual phases and shall take place on the dates set out in the Cap Table, or such other date as the Investors may mutually agree in writing, provided that the Closing 1 Conditions and the Subsequent Closing Conditions have been satisfied (or waived in full by the Investors).
 
6.1
Closing 1 Conditions
The subscription and allotment of Consideration Shares pursuant to Closing 1 shall be conditional on:
 

 a)
NWEC having executed a shipbuilding contract in respect of the Vessel;
 

 b)
NWEC having executed a ship management agreement between NWEC and Norwind Offshore AS, reg.no. 928 882 152, for the management of the Vessel;
 

 c)
NWEC having effected name change to Wind Energy Construction AS;
 

 d)
Vard having issued the refund guarantee for the initial payment under the shipbuilding contract in respect of the Vessel;
 

 e)
The Investors having executed and delivered the Shareholders’ Agreement.
 
6.2
Subsequent Closing Conditions
The subscription and allotment of Consideration Shares pursuant to each Subsequent Closing shall be conditional on:
 

 a)
Completion of the immediately preceding Closing.
 
6.3
Closing Obligations
At each Closing, the following actions shall take or have taken place on the date set out in the Cap Table or such other date as the Investors may mutually agree in writing:
 
6 / 10

 i.
The Investors shall subscribe for, and the Company shall issue to the Investors the Shares as set out in the Cap Table;
 

 ii.
At each Closing the Company shall deliver (or procure the delivery of) the following documents to the Investors:
 

 a.
Minutes of an extraordinary general meeting of the Company (i) resolving the subscription of the relevant Shares, (ii) evidencing the Investors’ immediate subscription of the relevant Shares at the general meeting in the minute book, cf. Section 10-7 of the Norwegian Private Limited Companies Act; and
 

 b.
Amend the articles of association of the Company as adopted at the extraordinary general meeting referred to in a) above.
 

 iii.
At each Closing the Investors shall pay to the Company, the subscription price for the relevant Shares as set out in the Cap Table;
 

 iv.
The Company shall as soon as practicable following each Closing and in accordance with applicable law, update the share register of the Company reflecting the Investors’ subscription and the issue to the Investors of the relevant Shares pursuant to the Cap Table and attend to all other necessary updates to the Company’s corporate records (including public records) in respect of the transactions contemplated under this Agreement.
 

 v.
Each of the deliveries to be made and the actions required to be performed to effect and complete each Closing as set out in ii. and iii. above shall be deemed to have occurred simultaneously, and none of such actions shall be considered performed until and unless all such actions have been performed or waived, as applicable.
 
7.
ACCESSION
 
This Agreement may not be assigned by any Party, without the written consent of the other Parties, such consent not to be unreasonably withheld.
 
8.
SEVERAL AND NOT JOINT LIABILITY
 
The obligations of the Investors as set forth herein to contribute in the Share Issue are several and not joint, but the failure by a Party to make its contribution shall not release the other Parties from their obligations.
 
9.
MISCELLANEOUS
 
9.1
Amendments
This Agreement may only be amended by written approval by all Parties.
 
9.2
Costs
Each party shall pay its own costs and legal or other advisory expenses incurred in connection with the preparation, negotiation and execution of this Agreement.

7 / 10
9.3
Confidentiality
This Agreement including all negotiations and written correspondence shall remain strictly confidential between the Parties, their financiers/banks, external counsels and auditors provided however that the Parties may disclose as much as may be necessary of the terms of this Agreement and relevant documentation to their auditors, managers, legal counsels, accountants, affiliates and as otherwise may be required by applicable laws or regulations, including but not limited to any stock exchange and/or securities and exchange commission laws and regulations. Any report or release or publication relating to this Agreement shall not be grounds for the Parties to withdraw from their obligations under this Agreement. Press releases or reports as required by stock exchange rules and regulations are allowed.
 
9.4
Counterparts
This Agreement may be executed in any number of counterparts, each of which shall be enforceable against the parties actually executing such counterparts, and all of which together shall constitute one instrument. A signed copy of this Agreement delivered by e-mail or other means of electronic transmission (such as .pdf format) shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
 
10.
GOVERNING LAW AND JURISDICTION
 
10.1
Governing law
This Agreement shall be governed by the laws of Norway.
 
10.2
Jurisdiction
Any dispute, controversy or claim arising out of or in connection with this Agreement, or the breach, termination or invalidity thereof, and which is not settled by mutual agreement, shall be resolved by arbitration in Oslo in accordance with the Arbitration Act of 2004 (Nw: voldgiftsloven). The arbitration proceedings and the arbitration award shall be kept strictly confidential. The arbitration shall be conducted in English.

****

[Signature page follows]

8 / 10
RGI Marine Limited
Steady Offshore Shipping Pre Ltd
   
/s/ Bartholomew Richard Fairclough
/s/ Kuang Shihao
           
Name: Bartholomew Richard Fairclough
Name: Kuang Shihao
Title: Chairman
Title: Director

United Maritime Corporation
Karean AS
   
/s/ Stavros Gyftakis
/s/ Anders Engeset
           
Name: Stavros Gyftakis
Name: Anders Engeset
Title: CFO / Director
Title: Chairman

 
Mr Jonathan Elkington
  
     
 
/s/ Jonathan Elkington
  
         


9 / 10
SCHEDULE 1
 
Cap Table
 
[intentionally omitted]
 



10 / 10
EX-4.38 14 ef20039046_ex4-38.htm EXHIBIT 4.38
Exhibit 4.38

EXECUTION VERSION

Dated 5 August 2024

$16,500,000
SECURED TERM LOAN FACILITY
 
CHRISEA MARITIME CO.
as Borrower

and
 
UNITED MARITIME CORPORATION
as Guarantor
 
and
 
SINOPAC CAPITAL INTERNATIONAL (HK) LIMITED
as Original Lender

FACILITY AGREEMENT
 
relating to
the part financing of the acquisition cost of
m.v. "CHRISEA"




Index


Clause
Page

Section 1 Interpretation
5
1
Definitions and Interpretation
5
Section 2 The Facility
30
2
The Facility
30
3
Purpose
30
4
Conditions of Utilisation
30
Section 3 Utilisation
32
5
Utilisation
32
Section 4 Repayment, Prepayment and Cancellation
35
6
Repayment
35
7
Prepayment and Cancellation
35
Section 5 Costs of Utilisation
38
8
Interest
38
9
Interest Periods
39
10
Changes to the Calculation of Interest
39
11
Fees
40
Section 6 Additional Payment Obligations
42
12
Tax Gross Up and Indemnities
42
13
Increased Costs
45
14
Other Indemnities
47
15
Mitigation by the Lender
49
16
Costs and Expenses
50
Section 7 Guarantee
51
17
Guarantee and Indemnity
51
Section 8 Representations, Undertakings and Events of Default
 54
18
Representations
 54
19
Information Undertakings
 61
20
General Undertakings
 64
21
Insurance Undertakings
 73
22
Ship Undertakings
 78
23
Security Cover
 85
24
Events of Default
 87
Section 9 Changes to Parties
 93
25
Changes to the Transaction Obligors
 93
Section 10 Administration
 94
26
Changes to the Lender
94
27
Payment Mechanics
 96
28
Set-Off
 98
29
Conduct of Business by the Lender
 98
30
Bail-In
 99
31
Notices
99
32
Calculations and Certificates
101
33
Partial Invalidity
 101
34
Remedies and Waivers
 101
35
Entire Agreement
 102
36
Settlement or Discharge Conditional
 102
37
Irrevocable Payment
 102

SINGAPORE/91371628v6
SinoPac Capital – Facility Agreement
38
Amendments
 102
39
Confidentiality
 105
40
Confidentiality of Funding Rates
 108
41
Counterparts
 109
Section 11 Governing Law and Enforcement
 110
42
Governing Law
 110
43
Enforcement
 110
Schedule 1 The Parties
 111
Schedule 2 Conditions Precedent and Conditions Subsequent
 113
Schedule 3 Utilisation Request
 120
Schedule 4 List of Approved Valuers
122
Schedule 5 Timetables
123
Execution Pages
124

SINGAPORE/91371628v6
SinoPac Capital – Facility Agreement
THIS AGREEMENT is made on 5 August   2024
 
PARTIES
 
(1)
CHRISEA MARITIME CO., a corporation incorporated in the Republic of the Marshall Islands, whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 as borrower (the "Borrower")
 
(2)
UNITED MARITIME CORPORATION, a corporation incorporated in the Republic of the Marshall Islands, whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 as guarantor (the "Guarantor")
 
(3)
SINOPAC CAPITAL INTERNATIONAL (HK) LIMITED, a company incorporated in Hong Kong with limited liability and business registration number 71963750, acting through its office at 6F., No. 130, Sec. 3, Nanjing E. Rd., Zhongshan Dist., Taipei City 104, Taiwan as Lender (the "Original Lender")
 
BACKGROUND
 
The Lender has agreed to make available to the Borrower a secured term loan facility of up to the lower of (i) $16,500,000 and (ii) 72.5% of the Fair Market Value of the Ship as at the Utilisation Date for the purpose of financing part of the acquisition cost of the Ship.
 
OPERATIVE PROVISIONS
SINGAPORE/91371628v6

SinoPac Capital – Facility Agreement
SECTION 1

INTERPRETATION
 
1
DEFINITIONS AND INTERPRETATION
 
1.1
Definitions
 
In this Agreement:
 
"Account Bank" means Alpha Bank S.A of 93, Akti Miaouli, 18538, Piraeus, Greece (SWIFT Address: ), or any other bank acceptable to the Lender.
 
"Affiliate" means, in relation to any person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company.
 
"Annex VI" means Annex VI of the Protocol of 1997 to amend the International Convention for the Prevention of Pollution from Ships 1973 (Marpol), as modified by the Protocol of 1978 relating thereto.
 
"Approved Brokers" means Evmar Marine Inc., Arthur J. Gallagher & Co., Seascope Hellas S.A. and any other such insurance brokers firm or firms approved in writing by the Lender.
 
"Approved Classification" means, as at the date of this Agreement, “A1, Bulk Carrier, BC-A (holds 2,4 & 6 may be empty), ESP, AMS, ACCU, CPS, CSR with Additional Notations CRC(I), GRAB 20, RRDA, TCM, UWILD” with the Approved Classification Society.

"Approved Classification Society" means, as at the date of this Agreement, American Bureau of Shipping, and hereafter shall include any other classification society which is a member of the International Association of Classification Societies approved in writing by the Lender.
 
"Approved Commercial Manager" means:
 

 (a)
Fidelity Marine Inc., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH 96960, Marshall Islands;
 

 (b)
United Management Corp., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960, Marshall Islands;
 

 (c)
Seanergy Management Corp., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960, Marshall Islands; and/or
 

 (d)
any other person approved in writing by the Lender as the commercial manager of the Ship.
 
"Approved Crew Manager" means Global Seaways S.A., a corporation redomiciled in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960, Marshall Islands, or any other person approved in writing by the Lender as the crew manager of the Ship.
 
SINGAPORE/91371628v6

5 SinoPac Capital – Facility Agreement
"Approved Flag" means the Bahamas, the Republic of Liberia, the Republic of Panama, the Republic of the Marshall Islands, Hong Kong, Singapore or any other flag approved in writing by the Lender.
 
"Approved Manager" means the Approved Commercial Manager, the Approved Technical Manager or the Approved Crew Manager.
 
"Approved Technical Manager" means Seanergy Shipmanagement Corp., a corporation incorporated in the Republic of the Marshall Islands whose registered address is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960, Marshall Islands, or any other person approved in writing by the Lender as the technical manager of the Ship.
 
"Approved Valuer" means at any time during the Security Period, any of the firms listed in Schedule 4 (List of Approved Valuers) or an Affiliate of any such firm through which valuations are commonly issued or any other reputable firm or firms of independent sale and purchase shipbrokers as agreed between the Lender and the Borrower from time to time.
 
"Article 55 BRRD" means Article 55 of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms.
 
"Assignable Charter" means, in relation to the Ship:
 

 (a)
a bareboat or demise charter for any duration; or
 

 (b)
any time, voyage, consecutive voyage charter or dedicated contract of affreightments having a duration of more than (without taking into account any optional extensions) 12 months, including the Initial Charter,
 
in each case, made on terms and with a charterer acceptable in all respects to the Lender.
 
"Authorisation" means an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation, legalisation or registration.
 
"Availability Period" means the period from and including the date of this Agreement to and including 31 August 2024 or such later date as may be agreed by the Lender.
 
"Available Facility" means the Commitment minus:
 

 (a)
the amount of the outstanding Loan; and
 

 (b)
in relation to any proposed Utilisation, the amount of the Loan that is due to be made on or before the proposed Utilisation Date.
 
"Bail-In Action" means the exercise of any Write-down and Conversion Powers.
 
"Bail-In Legislation" means:
 

 (a)
in relation to an EEA Member Country which has implemented, or which at any time implements, Article 55 BRRD, the relevant implementing law or regulation as described in the EU Bail-In Legislation Schedule from time to time;
 

 (b)
in relation to any state other than such an EEA Member Country and the United Kingdom, any analogous law or regulation from time to time which requires contractual recognition of any Write-down and Conversion Powers contained in that law or regulation; and
 
SINGAPORE/91371628v6

6 SinoPac Capital – Facility Agreement

(c)
in relation to the United Kingdom, the UK Bail-In Legislation.
 
"Balloon Amount” has the meaning given to it in Clause 6.1 (Repayment of Facility).
 
"Basel III” has the meaning given to it in Clause 13.1 (Increased costs).
 
"Break Costs" means the amount (if any) by which:
 

 (a)
the interest which the Lender should have received for the period from the date of receipt of all or any part of the Loan or an Unpaid Sum to the last day of the current Interest Period in relation to the Loan, the relevant part of the Loan or that or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period,
 
exceeds
 

 (b)
the amount which the Lender would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period.
 
"Business Day" means a day (other than a Saturday or Sunday) on which banks are open for general business in Singapore, Hong Kong, Taipei, Athens, the Republic of the Marshall Islands and London and:
 

 (a)
(in relation to the prepositioning of the Prepositioned Amount and the acquisition of the Ship under the MOA) Tokyo;
 

 (b)
(in relation to a date on which any payment under any Finance Document shall be made) New York; and
 

 (c)
(in relation to the fixing of an interest rate) a day which is a US Government Securities Business Day.
 
"Business Ethics Law" means any anti-bribery, anti-money laundering and anti-corruption laws or regulations in any applicable jurisdictions.
 
"Charter" means any charter relating to the Ship, or other contract for its employment, whether or not already in existence, including (without limitation) any Assignable Charter.
 
"Charter Guarantee" means any guarantee, bond, letter of credit or other instrument (whether or not already issued) supporting a Charter.
 
"Code" means the US Internal Revenue Code of 1986.
 
"Commitment" means the lower of (i) $16,500,000 and (ii) 72.5% of the Fair Market Value of the Ship as at the Utilisation Date, to the extent not cancelled or reduced under this Agreement.
 
SINGAPORE/91371628v6

7 SinoPac Capital – Facility Agreement
"Confidential Information" means all information relating to any Transaction Obligor, the Group, the Finance Documents or the Facility of which the Lender becomes aware in its capacity as, or for the purpose of becoming, the Lender or which is received by the Lender in relation to, or for the purpose of becoming the Lender under, the Finance Documents or the Facility from any Transaction Obligor, any member of the Group or any of its advisers in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes:
 

 (a)
information that:
 

 (i)
is or becomes public information other than as a direct or indirect result of any breach by the Lender of Clause 39 (Confidentiality); or
 

 (ii)
is identified in writing at the time of delivery as non-confidential by any Transaction Obligor, or any member of the Group or any of its advisers; or
 

 (iii)
is known by the Lender before the date the information is disclosed to it by any Transaction Obligor, any member of the Group or any of its advisers or is lawfully obtained by the Lender after that date, from a source which is, as far as the Lender is aware, unconnected with any Transaction Obligor or the Group and which, in either case, as far as the Lender is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality; and
 

 (b)
any Funding Rate.
 
"Confidentiality Undertaking" means a confidentiality undertaking in substantially the appropriate form recommended by the LMA from time to time or in any other form agreed between the Borrower and the Lender.
 
"CRD IV” has the meaning given to it in Clause 13.1 (Increased costs).
 
"Default" means an Event of Default or a Potential Event of Default.
 
"Delegate" means any delegate, agent, attorney, co-trustee or other person appointed by the Lender.
 
"Dispute” has the meaning given to it in Clause 43 (Enforcement).
 
"Disruption Event" means either or both of:
 

 (a)
a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Facility (or otherwise in order for the transactions contemplated by the Finance Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties or, if applicable, any Transaction Obligor; or
 

 (b)
the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a Party or, if applicable, any Transaction Obligor preventing that, or any other, Party or, if applicable, any Transaction Obligor:
 
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(i)
from performing its payment obligations under the Finance Documents to which it is a party; or
 

 (ii)
from communicating with other Parties or, if applicable, any Transaction Obligor in accordance with the terms of the Finance Documents,
 
and which (in either such case) is not caused by, and is beyond the control of, the Party or, if applicable, any Transaction Obligor whose operations are disrupted.
 
"Document of Compliance" has the meaning given to it in the ISM Code.
 
"dollars" and "$" mean the lawful currency, for the time being, of the United States of America.
 
"Earnings" means all moneys whatsoever which are now, or later become, payable (actually or contingently) to the Borrower or the Lender and which arise out of or in connection with or relate to the use or operation of the Ship, including (but not limited to):
 

 (a)
the following, save to the extent that any of them is, with the prior written consent of the Lender, pooled or shared with any other person:
 

 (i)
all freight, hire and passage moneys including, without limitation, all moneys payable under, arising out of or in connection with a Charter or a Charter Guarantee;
 

 (ii)
the proceeds of the exercise of any lien on sub-freights;
 

 (iii)
compensation payable to the Borrower or the Lender in the event of requisition of the Ship for hire or use;
 

 (iv)
remuneration for salvage and towage services;
 

 (v)
demurrage and detention moneys;
 

 (vi)
without prejudice to the generality of sub-paragraph (i) above, damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of the Ship;
 

 (vii)
all moneys which are at any time payable under any Insurances in relation to loss of hire;
 

 (viii)
all monies which are at any time payable to the Borrower in relation to general average contribution; and
 

 (b)
if and whenever the Ship is employed on terms whereby any moneys falling within sub-paragraphs (i) to (viii) of paragraph (a) above are pooled or shared with any other person, that proportion of the net receipts of the relevant pooling or sharing arrangement which is attributable to the Ship.
 
"Earnings Account" means:
 

 (a)
an account in the name of the Borrower with account no. (IBAN: ) with the Account Bank;
 
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(b)
any other account in the name of the Borrower with the Account Bank which may, with the prior written consent of the Lender, be opened in the place of the account referred to in paragraph (a) above, irrespective of the number or designation of such replacement account; or
 

 (c)
any sub-account of any account referred to in paragraph (a) or (b) above.
 
"EEA Member Country" means any member state of the European Union, Iceland, Liechtenstein and Norway.
 
"Environmental Approval" means any present or future permit, ruling, variance or other Authorisation required under Environmental Law.
 
"Environmental Claim" means any claim by any governmental, judicial or regulatory authority or any other person which arises out of an Environmental Incident or an alleged Environmental Incident or which relates to any Environmental Law and, for this purpose, "claim" includes a claim for damages, compensation, contribution, injury, fines, losses and penalties or any other payment of any kind, including in relation to clean-up and removal, whether or not similar to the foregoing; an order or direction to take, or not to take, certain action or to desist from or suspend certain action; and any form of enforcement or regulatory action, including the arrest or attachment of any asset.
 
"Environmental Incident" means:
 

 (a)
any release, emission, spill or discharge of Environmentally Sensitive Material whether within the Ship or from the Ship into any other vessel or into or upon the air, water, land or soils (including the seabed) or surface water; or
 

 (b)
any incident in which Environmentally Sensitive Material is released, emitted, spilled or discharged into or upon the air, water, land or soils (including the seabed) or surface water from a vessel other than the Ship and which involves a collision between the Ship and such other vessel or some other incident of navigation or operation, in either case, in connection with which the Ship is actually or potentially liable to be arrested, attached, detained or injuncted and/or the Ship and/or any Transaction Obligor and/or any operator or manager of the Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action; or
 

 (c)
any other incident in which Environmentally Sensitive Material is released, emitted, spilled or discharged into or upon the air, water, land or soils (including the seabed) or surface water otherwise than from the Ship and in connection with which the Ship is actually or potentially liable to be arrested and/or where any Transaction Obligor and/or any operator or manager of the Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action, other than in accordance with an Environmental Approval.
 
"Environmental Law" means any present or future law relating to vessel disposal, energy efficiency, carbon reduction, emissions, emissions trading, pollution or protection of human health or the environment, to conditions in the workplace, to the carriage, generation, handling, storage, use, release or spillage of Environmentally Sensitive Material or to actual or threatened releases of Environmentally Sensitive Material.
 
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"Environmentally Sensitive Material" means and includes all contaminants, oil, oil products, toxic substances and any other substance (including any chemical, gas or other hazardous or noxious substance) which is (or is capable of being or becoming) polluting, toxic or hazardous.
 
"Escrow Account” means the account in the name of the Escrow Agent specified in the Escrow Agreement.
 
"Escrow Agreement" means an escrow agreement entered or to be entered into, among others, the Borrower, the Seller, the Lender and the Escrow Agent.
 
"Escrow Agent" means Tanaka & Partners, LPC. or such other entity which is acceptable to the Lender.
 
"EU Bail-In Legislation Schedule" means the document described as such and published by the LMA from time to time.
 
"EU Ship Recycling Regulation" means Regulation (EU) No 1257/2013 of the European Parliament and of the Council of 20 November 2013 on ship recycling and amending Regulation (EC) No 1013/2006 and Directive 2009/16/EC.
 
"Event of Default" means any event or circumstance specified as such in Clause 24 (Events of Default).
 
“Existing Lender” has the meaning given to it in Clause 26.1 (Assignment by the Lender).
 
"Facility" means the term loan facility made available under this Agreement as described in Clause 2 (The Facility).
 
"Facility Office" means the office or offices through which the Lender will perform its obligations under this Agreement.
 
"Fair Market Value" means, at any date, the market value in dollars of the Ship or any other vessel, shown by one valuation prepared at the cost of the Borrower:
 
(a)
 

 (i)
in relation to the valuation provided prior to the Utilisation Date under Clause 4 (Conditions of Utilisation) only, as at a date not more than three Months prior to such date; or
 

 (ii)
in relation to any other valuations provided pursuant to any Finance Document, as at 30 June and 31 December each calendar year;
 

 (b)
by an Approved Valuer appointed by the Lender
 

 (c)
on a charter free basis and on a desktop basis;
 

 (d)
with or without physical inspection of the Ship or vessel (as the Lender may require); and
 

 (e)
on the basis of a sale for prompt delivery for cash on normal arm's length terms as between a willing seller and a willing buyer, free of any Charter,
 
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provided that if the market value shown in a valuation comprises of a range of values, the midpoint of such range shall be used for the purposes of determining the arithmetic average.

"FATCA" means:
 

 (a)
sections 1471 to 1474 of the Code or any associated regulations;
 

 (b)
any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above; or
 

 (c)
any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraph (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.
 
"FATCA Deduction" means a deduction or withholding from a payment under a Finance Document required by FATCA.
 
"FATCA Exempt Party" means a Party that is entitled to receive payments free from any FATCA Deduction.
 
"Fee Letter" means any letter or letters dated on or about the date of this Agreement between the Lender and the Borrower or Guarantor setting out any of the fees referred to in Clause 11 (Fees).
 
"Finance Document" means:
 

 (a)
this Agreement;
 

 (b)
any Fee Letter;
 

 (c)
any Security Document;
 

 (d)
the Utilisation Request; and
 

 (e)
any Subordination Agreement;
 

 (f)
any other document which is executed for the purpose of establishing any priority or subordination arrangement in relation to the Secured Liabilities; or
 

 (g)
any other document designated as such by the Lender and the Borrower.
 
"Financial Indebtedness" means any indebtedness for or in relation to:
 

 (a)
moneys borrowed;
 

 (b)
any amount raised by acceptance under any acceptance credit facility or dematerialised equivalent;
 

 (c)
any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;
 
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(d)
the amount of any liability in relation to any lease or hire purchase contract which would, in accordance with GAAP, be treated as a balance sheet liability;
 

 (e)
receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);
 

 (f)
any amount raised under any other transaction (including any forward sale or purchase agreement) of a type not referred to in any other paragraph of this definition having the commercial effect of a borrowing;
 

 (g)
any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked to market value (or, if any actual amount is due as a result of the termination or close-out of that derivative transaction, that amount) shall be taken into account);
 

 (h)
any counter-indemnity obligation in relation to a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and
 

 (i)
the amount of any liability in relation to any guarantee or indemnity for any of the items referred to in paragraphs (a) to (h) above.
 
"First Currency” has the meaning given to it in Clause 14.1 (Currency Indemnity).
 
"Funding Rate" means any individual rate notified by the Lender to the Borrower pursuant to sub-paragraph (ii) of paragraph (a) of Clause 10.3 (Cost of funds).
 
"GAAP" means generally accepted accounting principles in the US or IFRS.
 
"General Assignment" means the general assignment creating Security over the Ship's Assignable Charter, Earnings, Insurances and Requisition Compensation, in agreed form.
 
"Group" means the Guarantor and its Subsidiaries for the time being.
 
"Historic Term SOFR" means, in relation to the Loan or any part of the Loan, the most recent applicable Term SOFR for a period equal in length to the Interest Period of the Loan or that part of the Loan and which is as of a day which is no more than three US Government Securities Business Days before the Quotation Day.
 
"Holding Company" means, in relation to a person, any other person in relation to which it is a Subsidiary.
 
"IFRS" means international accounting standards within the meaning of the IAS Regulation 1606/2002 (as may be amended and/or updated from time to time) to the extent applicable to the relevant financial statements.
 
"Increased Costs” has the meaning given to it in Clause 13.1 (Increased costs).
 
"Indemnified Person" has the meaning given to it in Clause 14.2 (Other indemnities).
 
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"Initial Charter" means a time charterparty dated 9 February 2024 as amended and supplemented by an addendum no. 1 dated 9 February 2024, an addendum no. 2 dated 8 March 2024, an addendum no. 3 dated 27 June 2024 and an addendum no. 4 dated 27 June 2024 and made between the Borrower as owners and Cargill International S.A. as charterers, as may be further amended and supplemented from time to time.
 
"Insurances" means:
 

 (a)
all policies and contracts of insurance, including entries of the Ship in any protection and indemnity or war risks association, effected in relation to the Ship, the Earnings or otherwise in relation to the Ship whether before, on or after the date of this Agreement; and
 

 (b)
all rights and other assets relating to, or derived from, any of such policies, contracts or entries, including any rights to a return of premium and any rights in relation to any claim whether or not the relevant policy, contract of insurance or entry has expired on or before the date of this Agreement.
 
"Interest Period" means, in relation to the Loan or any part of the Loan, each period determined in accordance with Clause 9 (Interest Periods) and, in relation to an Unpaid Sum, each period determined in accordance with Clause 8.3 (Default interest).
 
"Interpolated Historic Term SOFR" means, in relation to the Loan or any part of the Loan, the rate (rounded to the same number of decimal places as Term SOFR) which results from interpolating on a linear basis between:
 

 (a)
either:
 

 (i)
the most recent applicable Term SOFR (as of a day which is not more than three US Government Securities Business Days before the Quotation Day) for the longest period (for which that Term SOFR is available) which is less than the Interest Period of the Loan or that part of the Loan; or
 
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(ii)
if no such Term SOFR is available for a period which is less than the Interest Period of the Loan or that part of the Loan, the most recent SOFR for a day which is no more than five US Government Securities Business Days (and no less than two US Government Securities Business Days) before the Quotation Day; and
 

 (b)
the most recent applicable Term SOFR (as of a day which is not more than three US Government Securities Business Days before the Quotation Day) for the shortest period (for which Term SOFR is available) which exceeds the Interest Period of the Loan or that part of the Loan.
 
"Interpolated Term SOFR" means, in relation to the Loan or any part of the Loan, the rate (rounded to the same number of decimal places as Term SOFR) which results from interpolating on a linear basis between:
 

 (a)
either:
 

 (i)
the applicable Term SOFR (as of the Specified Time) for the longest period (for which Term SOFR is available) which is less than the Interest Period of the Loan or that part of the Loan; or
 

 (ii)
if no such Term SOFR is available for a period which is less than the Interest Period of the Loan or that part of the Loan, SOFR for the day which is two US Government Securities Business Days before the Quotation Day; and
 

 (b)
the applicable Term SOFR (as of the Specified Time) for the shortest period (for which Term SOFR is available) which exceeds the Interest Period of the Loan or that part of the Loan.
 
"Inventory of Hazardous Materials" means an inventory certificate or statement of compliance (as applicable) issued by the relevant classification society/shipyard authority which is supplemented by a list of any and all materials known to be potentially hazardous utilised in the construction of, or otherwise installed on, the Ship, pursuant to the requirements of the EU Ship Recycling Regulation.
 
"ISM Code" means the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention (including the guidelines on its implementation), adopted by the International Maritime Organisation, as the same may be amended or supplemented from time to time.
 
"ISPS Code" means the International Ship and Port Facility Security (ISPS) Code as adopted by the International Maritime Organization's (IMO) Diplomatic Conference of December 2002, as the same may be amended or supplemented from time to time.
 
"ISSC" means an International Ship Security Certificate issued under the ISPS Code.
 
"Lender" means:
 

 (a)
the Original Lender; and
 

 (b)
any bank, financial institution, trust, fund or other entity which has become the Lender in accordance with Clause 26 (Changes to the Lender),
 
which in each case has not ceased to be a Party in accordance with this Agreement.
 
"LMA" means the Loan Market Association or any successor organisation.
 
“LMAA” has the meaning given to it in Clause 43 (Enforcement).
 
"Loan" means the loan to be made available under the Facility or the aggregate principal amount outstanding for the time being of the borrowings under the Facility and a "part of the Loan" means any part of the Loan as the context may require.
 
"Major Casualty" means any casualty to the Ship in relation to which the claim or the aggregate of the claims against all insurers, before adjustment for any relevant franchise or deductible, exceeds $1,000,000 or the equivalent in any other currency.
 
"Management Agreement" means, in relation to an Approved Manager, the agreement entered into between the Borrower and such Approved Manager regarding the crew, technical and/or commercial management (as applicable) of the Ship.
 
"Manager's Undertaking" means, in relation to an Approved Manager, the letter of undertaking from such Approved Manager subordinating its rights against the Ship and the Borrower to the rights of the Lender and including (inter alia) a first priority assignment of that Approved Manager’s rights, title and interest in the Insurances of the Ship in agreed form.
 
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"Mandatory Cost" has the meaning given to it in Clause 14.3 (Mandatory Cost);
 
"Margin" means two point six per cent. (2.6%) per annum.
 
"Material Adverse Effect" means, in the reasonable opinion of the Lender, a material adverse effect on:
 

 (a)
the business, operations, property or condition (financial or otherwise) of the Group as a whole; or
 

 (b)
the ability of any Obligor to perform its obligations under any Finance Document; or
 

 (c)
the validity, legality or enforceability of, or the effectiveness or ranking of, any Security granted or intended to be granted pursuant to any of, the Finance Documents, or the rights or remedies of the Lender under any of the Finance Documents.
 
"MOA" means the memorandum of agreement made or to be made between the Seller as sellers and the Borrower as buyers regarding the sale and purchase of the Ship pursuant to the expiry purchase option provision under the bareboat charter hire purchase agreement between the Seller and the Borrower, under which the sale of the Ship will be partly financed by the Facility on the Release Date.
 
"Month" means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that:
 

 (a)
(subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day;
 

 (b)
if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and
 

 (c)
if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end.
 
The above rules will only apply to the last Month of any period.
 
"Mortgage" means the first priority or, as the case may be, preferred Approved Flag ship mortgage on the Ship (together with, if applicable, the deed of covenants collateral thereto) in agreed form.
 
"New Lender” has the meaning given to it in Clause 26.1 (Assignment by the Lender).
 
"Obligor" means the Borrower or the Guarantor.
 
"Original Financial Statements" means:
 

 (a)
in relation to the Borrower, the unaudited financial statements of the Borrower for its financial year ending 31 December 2023; and
 
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(b)
in relation to the Guarantor, the audited consolidated financial statements of the Guarantor for its financial year ending 31 December 2023.
 
"Original Jurisdiction" means, in relation to an Obligor, the jurisdiction under whose laws that Obligor is incorporated as at the date of this Agreement.
 
"Overseas Regulations" means the Overseas Companies Regulations 2009 (SI 2009/1801).
 
"Participating Member State" means any member state of the European Union that has the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.
 
"Party" means:
 

 (a)
for the purposes of Clause 43 (Enforcement) only, the Obligors collectively as one Party and the Lender as the other Party; or
 

 (c)
for all other purposes, a party to this Agreement.
 
"Perfection Requirements" means the making or procuring of filings, stampings, registrations, notarisations, endorsements, translations and/or notifications of any Finance Document (and/or any Security created under it) necessary for the validity, enforceability (as against the relevant Obligor or any relevant third party) and/or perfection of that Finance Document.

"Permitted Charter" means a Charter:
 

 (a)
until the Release Date, the bareboat charter hire purchase agreement dated 9 February 2023 and entered between, inter alia, the Seller as registered owner and the Borrower as bareboat charterer for the Ship, as amended and supplemented from time to time;
 

 (b)
which is a time, voyage or consecutive voyage charter;
 

 (c)
the duration of which does not exceed and is not capable of exceeding by virtue of any optional extensions, 12 months;
 

 (d)
which is entered into on bona fide arm's length terms at the time at which the Ship is fixed; and
 

 (e)
in relation to which not more than two months' hire is payable in advance,
 
and any other Charter which is approved in writing by the Lender, including the Initial Charter.
 
"Permitted Financial Indebtedness" means:
 

 (a)
until the Release Date, any amount payable by the Borrower to the Seller under the MOA;
 

 (b)
any Financial Indebtedness incurred under the Finance Documents;
 

 (c)
any trade debt incurred in the Borrower’s ordinary course of business; and
 

 (d)
any Financial Indebtedness that is subordinated to all Financial Indebtedness incurred under the Finance Documents pursuant to a Subordination Agreement or otherwise and which is, in the case of any such Financial Indebtedness of the Borrower, the subject of Subordinated Debt Security, Subordination Agreement or otherwise.
 
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"Permitted Security" means:
 

 (a)
Security created by the Finance Documents;
 

 (b)
liens for unpaid master's and crew's wages in accordance with first class ship ownership and management practice and not being enforced through arrest;
 

 (c)
liens for salvage;
 

 (d)
liens for master's disbursements incurred in the ordinary course of trading in accordance with first class ship ownership and management practice and not being enforced through arrest; and
 

 (e)
any other lien arising by operation of law or otherwise in the ordinary course of the operation, repair or maintenance of the Ship:
 

 (i)
not as a result of any default or omission by the Borrower;
 

 (ii)
not being enforced through arrest; and
 

 (iii)
subject, in the case of liens for repair or maintenance, to Clause 22.15 (Restrictions on chartering, appointment of managers etc.),
 
provided such lien does not secure amounts more than 30 days overdue (unless the overdue amount is being contested in good faith by appropriate steps and for the payment of which adequate reserves are held and provided further that such proceedings do not give rise to a material risk of the Ship or any interest in it being seized, sold, forfeited or lost).
 
"Potential Event of Default" means any event or circumstance specified in Clause 24 (Events of Default) which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any combination of any of the foregoing) be an Event of Default.
 
"Prepositioned Amount" has the meaning given to it in Clause 5.9 (Prepositioning of funds).
 
"Published Rate” has the meaning given to it in Clause 38.2 (Changes to reference rate).
 
"Published Rate Contingency Period” has the meaning given to it in Clause 38.2 (Changes to reference rate).
 
"Published Rate Replacement Event” has the meaning given to it in Clause 38.2 (Changes to reference rate).
 
"Purchase Price" means the total price of $12,360,000 payable for the Ship under clause 1 (Purchase Price) of the MOA.
 
"Quotation Day" means, in relation to any period for which an interest rate is to be determined, two US Government Securities Business Days before the first day of that period unless market practice differs in the relevant syndicated loan market, in which case the Quotation Day will be determined by the Lender in accordance with that market practice (and if quotations would normally be given on more than one day, the Quotation Day will be the last of those days).
 
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"Quoted Tenor” has the meaning given to it in Clause 38.2 (Changes to reference rate).
 
"Receiver" means a receiver or receiver and manager or administrative receiver of the whole or any part of the Security Assets.
 
“Rectification Date” has the meaning given to it in Clause 23.2 (Provision of additional security; prepayment).
 
"Reference Rate" means, in relation to the Loan or any part of the Loan:
 

 (a)
the applicable Term SOFR as of the Specified Time and for a period equal in length to the Interest Period of the Loan or that part of the Loan; or
 

 (b)
as otherwise determined pursuant to Clause 10.1 (Unavailability of Term SOFR),
 
and if, in either case, that rate is less than zero, the Reference Rate shall be deemed to be zero.
 
“Regulation” has the meaning given to it in Clause 18.31 (Centre of main interests and establishments).
 
"Related Fund" in relation to a fund (the "first fund"), means a fund which is managed or advised by the same investment manager or investment adviser as the first fund or, if it is managed by a different investment manager or investment adviser, a fund whose investment manager or investment adviser is an Affiliate of the investment manager or investment adviser of the first fund.
 
"Release Date" means the date of which the Prepositioned Amount is to be released in accordance with Clause 5.8 (Advance of Loan).
 
“Relevant Date” has the meaning given to it in Clause 7.3 (Mandatory prepayment on sale or Total Loss).
 
"Relevant Jurisdiction" means, in relation to a Transaction Obligor:
 

 (a)
its Original Jurisdiction;
 

 (b)
any jurisdiction where any asset subject to, or intended to be subject to, any of the Transaction Security created, or intended to be created, by it is situated;
 

 (c)
any jurisdiction where it conducts its business; and
 

 (d)
the jurisdiction whose laws govern the perfection of any of the Security Documents entered into by it.
 
"Relevant Market" means the market for overnight cash borrowing collateralised by US Government Securities.
 
"Relevant Nominating Body" has the meaning given to it in Clause 38.2 (Changes to reference rate).
 
"Repayment Date" means each date on which a Repayment Instalment and the Balloon Amount is required to be paid under Clause 6.1 (Repayment of Facility).
 
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"Repayment Instalment" has the meaning given to it in Clause 6.1 (Repayment of Facility).
 
"Repeating Representation" means each of the representations set out in Clause 18 (Representations) except Clause 18.10 (Insolvency), Clause 18.11 (No filing or stamp taxes) and Clause 18.12 (Deduction of Tax) and any representation of any Transaction Obligor made in any other Finance Document that is expressed to be a "Repeating Representation" or is otherwise expressed to be repeated.
 
“Replacement Reference Rate” has the meaning given to it in Clause 38.2 (Changes to reference rate).
 
"Representative" means any delegate, agent, manager, administrator, nominee, attorney, trustee or custodian.
 
"Requisition" means:
 

 (a)
any expropriation, confiscation, requisition (excluding a requisition for hire or use which does not involve a requisition for title) or acquisition of the Ship, whether for full consideration, a consideration less than its proper value, a nominal consideration or without any consideration, which is effected (whether de jure or de facto) by any government or official authority or by any person or persons claiming to be or to represent a government or official authority; and
 

 (b)
any capture or seizure of the Ship (including any hijacking or theft) by any person whatsoever.
 
"Requisition Compensation" includes all compensation or other moneys payable to the Borrower by reason of any Requisition or any arrest or detention of the Ship in the exercise or purported exercise of any lien or claim.
 
"Resolution Authority" means any body which has authority to exercise any Write-down and Conversion Powers.
 
"Restricted Party" means a person:
 

 (a)
that is listed on any Sanctions List (whether designated by name or by reason of being included in a class of person); or
 

 (b)
that is domiciled, registered as located or having its main place of business in, or is incorporated under the laws of, a country which is subject to Sanctions Laws which attach legal effect to being domiciled, registered as located or having its main place of business in such country; or
 

 (c)
that is directly or indirectly owned or controlled by a person referred to in paragraph (a) and/or (b) above; or
 

 (d)
with which any member of the Group is prohibited from dealing or otherwise engaging in a transaction with by any Sanctions Laws.
 
"Safety Management Certificate" has the meaning given to it in the ISM Code.

 "Safety Management System" has the meaning given to it in the ISM Code.
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"Sanctions Authority" means the United Nations, the United Kingdom, the European Union, the member states of the European Union, the United States of America, Taiwan, Singapore, Hong Kong and any authority acting on behalf of any of them in connection with Sanctions Laws.
 
"Sanctions Laws" means the economic or financial sanctions laws and/or regulations, trade embargoes, prohibitions, restrictive measures, decisions, executive orders or notices from regulators implemented, adapted, imposed, administered, enacted and/or enforced by any Sanctions Authority.
 
"Sanctions List" means any list of persons or entities published in connection with Sanctions Laws by or on behalf of any Sanctions Authority as amended, revised, supplemented or substituted from time to time.
 
“SEC” has the meaning given to it in Clause 39.2 (Disclosure of Confidential Information).
 
"Second Currency” has the meaning given to it in Clause 14.1 (Currency indemnity).
 
"Secured Liabilities" means all present and future obligations and liabilities (whether actual or contingent and whether owed jointly or severally or in any other capacity whatsoever) of each Transaction Obligor to the Lender under or in connection with each Finance Document.
 
"Security" means a mortgage, pledge, lien, charge, assignment, hypothecation or security interest or any other agreement or arrangement having the effect of conferring security.
 
"Security Assets" means all of the assets of the Transaction Obligors or Third Party Manager which from time to time are, or are expressed to be, the subject of the Transaction Security.
 
"Security Cover Ratio” means:
 

 (a)
the Fair Market Value of the Ship; plus
 

 (b)
the net realisable value of any additional Security previously provided under Clause 23 (Security Cover),
 
expressed as a percentage of the positive difference between the Loan and the Security Deposit Amount.
 
"Security Deposit Account" means the following account in the name of the Lender with the Security Deposit Account Bank.
 
 
Correspondent bank:
  
Wells Fargo Bank, N.A. (SWIFT code: )
or
Citibank, N.A., New York (SWIFT code: )
or
The Bank of New York Mellon (SWIFT code: )
 
Beneficiary Bank:
  
Bank SinoPac
 
 
Beneficiary Bank Address:
  
9F, No.36, Sec. 3, Nanjing E. Rd., Zhongshan Dist., Taipei,
Taiwan
 
SWIFT Code:
  
 



SINGAPORE/91371628v6

21 SinoPac Capital – Facility Agreement
 
Beneficiary:
  
SINOPAC CAPITAL INT’L (HK) LTD
 
Beneficiary Address :
  
6F.&7F., No. 130, Sec. 3, Nanjing E. Rd., Zhongshan Dist., Taipei, Taiwan
 
Account Number:
  
 
 
Currency:
  
USD

"Security Deposit Account Bank" means Bank SinoPac or such other bank as the Lender may require.
 
"Security Deposit Amount" means:
 

 (c)
the amount of $1,155,000; or
 

 (d)
if the amount of the Loan advanced is less than $16,500,000, such pro-rated amount of $1,155,000 as reduced by the same percentage of the undrawn amount out of $16,500,000.
 
"Security Document" means:
 

 (a)
the Shares Security;
 

 (b)
the Mortgage;
 

 (c)
the General Assignment;
 

 (d)
any Manager’s Undertaking;
 

 (e)
any Subordinated Debt Security;
 

 (f)
any other document (whether or not it creates Security) which is executed as security for the Secured Liabilities; or
 

 (g)
any other document designated as such by the Lender and the Borrower.
 
"Security Period" means the period starting on the date of this Agreement and ending on the date on which the Lender is satisfied that there is no outstanding Commitment in force and that the Secured Liabilities have been irrevocably and unconditionally paid and discharged in full.
 
"Security Property" means:
 

 (a)
the Transaction Security expressed to be granted in favour of the Lender and all proceeds of that Transaction Security;
 

 (b)
all obligations expressed to be undertaken by a Transaction Obligor to pay amounts in relation to the Secured Liabilities to the Lender and secured by the Transaction Security together with all representations and warranties expressed to be given by a Transaction Obligor or any other person in favour of the Lender; and
 
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(c)
the Lender's interest in any turnover trust created under the Finance Documents.

"Seller" means Mi-Das Line S.A., a company incorporated in the Republic of Panama.
 
"Shares Security" means a document creating Security over the shares in the Borrower in agreed form.
 
"Ship" means the 2013 built vessel m.v. "Chrisea" having a deadweight of approximately 78,173 with IMO number 9650755, registered under the ownership of the Seller as at the date of this Agreement under the laws of the Republic of Panama and bareboat charter registered in the name of the Borrower under the laws and flag of the Republic of the Marshall Islands, which shall be reflagged and registered under the ownership of the Borrower under the laws and flag of the Republic of the Marshall Islands on or about the Release Date.
 
"SOFR" means the secured overnight financing rate (SOFR) administered by the Federal Reserve Bank of New York (or any other person which takes over the administration of that rate) published (before any correction, recalculation or republication by the administrator) by the Federal Reserve Bank of New York (or any other person which takes over the publication of that rate).
 
"Specified Time" means a day or time determined in accordance with Schedule 5 (Timetables).
 
"Subordinated Creditor" means any person who becomes a Subordinated Creditor in accordance with this Agreement.
 
"Subordinated Debt Security" means a Security over Subordinated Liabilities entered into or to be entered into by a Subordinated Creditor in favour of the Lender in an agreed form.
 
"Subordinated Finance Document" means:
 

 (a)
a Subordinated Loan Agreement; and
 

 (b)
any other document relating to or evidencing Subordinated Liabilities.
 
"Subordinated Liabilities" means all indebtedness owed or expressed to be owed by the Borrower to a Subordinated Creditor whether under the Subordinated Finance Documents or otherwise.
 
"Subordinated Loan Agreement" means a loan agreement made between (i) the Borrower and (ii) a Subordinated Creditor.
 
"Subordination Agreement" means a subordination agreement entered into or to be entered into by the Borrower, a Subordinated Creditor and the Lender in agreed form.
 
"Subsidiary" means a subsidiary within the meaning of section 1159 of the Companies Act 2006.
 
"Sum” has the meaning given to it in Clause 14.1 (Currency indemnity).
 
"Tax" means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same).
 
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23 SinoPac Capital – Facility Agreement
"Tax Credit" has the meaning given to it in Clause 12.1 (Definitions).
 
"Tax Deduction" has the meaning given to it in Clause 12.1 (Definitions).
 
"Tax Payment" has the meaning given to it in Clause 12.1 (Definitions).
 
"Termination Date" means the fifth anniversary of the Utilisation Date.
 
“Term SOFR" means the term SOFR reference rate administered by CME Group Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant period published (before any correction, recalculation or republication by the administrator) by CME Group Benchmark Administration Limited (or any other person which takes over the publication of that rate).
 
"Third Parties Act" has the meaning given to it in Clause 1.5 (Third party rights).
 
"Third Party Manager" means any Approved Manager who is not a member of the Group.
 
"Total Loss" means:
 

 (a)
actual, constructive, compromised, agreed or arranged total loss of the Ship; or
 

 (b)
any Requisition of the Ship unless the Ship is returned to the full control of the Borrower within 30 days of such Requisition.
 
"Total Loss Date" means, in relation to the Total Loss of the Ship:
 

 (a)
in the case of an actual loss of the Ship, the date on which it occurred or, if that is unknown, the date when the Ship was last heard of;
 

 (b)
in the case of a constructive, compromised, agreed or arranged total loss of the Ship, the earlier of:
 

 (i)
the date on which a notice of abandonment is given (or deemed or agreed to be given) to the insurers; and
 

 (ii)
the date of any compromise, arrangement or agreement made by or on behalf of the Borrower with the Ship's insurers in which the insurers agree to treat the Ship as a total loss;
 

 (c)
in the case of a Requisition, the date on which that Requisition occurs; and
 

 (d)
in the case of any other type of Total Loss, the date (or the most likely date) on which it appears to the Lender that the event constituting the total loss occurred.
 
"Transaction Document" means:
 

 (a)
a Finance Document;
 

 (b)
a Subordinated Finance Document;
 

 (c)
a Management Agreement;
 

 (d)
any Permitted Charter;
 
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(e)
any related Charter Guarantee; or
 

 (f)
the MOA;
 

 (g)
any other document designated as such by the Lender and the Borrower.
 
"Transaction Obligor" means an Obligor, each Approved Manager which is a member of the Group or any other member of the Group who executes a Finance Document.
 
"Transaction Security" means the Security created or evidenced or expressed to be created or evidenced under the Security Documents.
 
"UK Bail-In Legislation" means Part 1 of the United Kingdom Banking Act 2009 and any other law or regulation applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutes or their affiliates (otherwise than through liquidation, administration or other insolvency proceedings).

"UK Establishment" means a UK establishment as defined in the Overseas Regulations.
 
"Unpaid Sum" means any sum due and payable but unpaid by a Transaction Obligor under the Finance Documents.
 
"US" means the United States of America.
 
"US Government Securities Business Day" means any day other than:
 

 (a)
a Saturday or a Sunday; and
 

 (b)
a day on which the Securities Industry and Financial Markets Association (or any successor organisation) recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in US Government securities.
 
"US Tax Obligor" means:
 

 (a)
a person which is resident for tax purposes in the US; or
 

 (b)
a person some or all of whose payments under the Finance Documents are from sources within the US for US federal income tax purposes.
 
"Utilisation" means the utilisation of the Facility.
 
"Utilisation Date" means the date on which the Loan is to be made.
 
"Utilisation Request" means a notice substantially in the form set out in Schedule 3 (Utilisation Request).
 
"VAT" means:
 

 (a)
any value added tax imposed by the Value Added Tax Act 1994;
 

 (b)
any tax imposed in compliance with the Council Directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); and
 
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(c)
any other tax of a similar nature, whether imposed in the United Kingdom or a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) or (b) above, or imposed elsewhere.
 
"Write-down and Conversion Powers" means:
 

 (a)
in relation to any Bail-In Legislation described in the EU Bail-In Legislation Schedule from time to time, the powers described as such in relation to that Bail-In Legislation in the EU Bail-In Legislation Schedule;
 

 (b)
in relation to any other applicable Bail-In Legislation other than the UK Bail-In Legislation:
 

 (i)
any powers under that Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank, investment firm or other financial institution, to cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers; and
 

 (ii)
any similar or analogous powers under that Bail-In Legislation; and
 

 (c)
in relation to any UK Bail-In Legislation, any powers under that UK Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank, investment firm or other financial institution, to cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that UK Bail-In Legislation that are related to or ancillary to any of those powers.
 
1.2
Construction
 
(a)
Unless a contrary indication appears, a reference in this Agreement to:
 

 (i)
the "Lender", any "Obligor", any "Party", any "Transaction Obligor", the "Account Bank" or any other person shall be construed so as to include its successors in title, permitted assigns and permitted transferees to, or of, its rights and/or obligations under the Finance Documents;
 

 (ii)
"assets" includes present and future properties, revenues and rights of every description;
 

 (iii)
a liability which is "contingent" means a liability which is not certain to arise and/or the amount of which remains unascertained;
 
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26 SinoPac Capital – Facility Agreement

(iv)
the Lender's "cost of funds" in relation to the funding of the Loan or any part of the Loan is a reference to the average cost (determined either on an actual or a notional basis) which the Lender would incur if it were to fund, from whatever source(s) it may reasonably select, an amount equal to the amount of the Loan or that part of the Loan for a period equal in length to the Interest Period of the Loan or that part of the Loan;
 

 (v)
"document" includes a deed and also a letter, fax, email or telex;
 

 (vi)
"expense" means any kind of cost, charge or expense (including all legal costs, charges and expenses) and any applicable Tax including VAT;
 

 (vii)
a "Finance Document", "Security Document" or "Transaction Document" or any other agreement or instrument is a reference to that Finance Document, Security Document or Transaction Document or other agreement or instrument as amended, replaced, novated, supplemented, extended or restated;
 

 (viii)
"indebtedness" includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent;
 

 (ix)
"law" includes any order or decree, any form of delegated legislation, any treaty or international convention and any regulation or resolution of the Council of the European Union, the European Commission, the United Nations or its Security Council;
 

 (x)
"proceedings" means, in relation to any enforcement provision of a Finance Document, proceedings of any kind, including an application for a provisional or protective measure;
 

 (xi)
a "person" includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium, partnership or other entity (whether or not having separate legal personality);
 

 (xii)
a "regulation" includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation;
 

 (xiii)
a reference to the "Ship", its name, its flag and, if applicable, its port of registry shall include any replacement name, flag and, if applicable, replacement port of registry, in each case, as may be approved in writing from time to time by the Lender;
 

 (xiv)
a provision of law is a reference to that provision as amended or re-enacted from time to time;
 

 (xv)
a time of day is a reference to London time;
 

 (xvi)
any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official or any legal concept or thing shall, in respect of a jurisdiction other than England, be deemed to include that which most nearly approximates in that jurisdiction to the English legal term;
 

 (xvii)
words denoting the singular number shall include the plural and vice versa; and
 
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27 SinoPac Capital – Facility Agreement

(xviii)
"including" and "in particular" (and other similar expressions) shall be construed as not limiting any general words or expressions in connection with which they are used.
 
(b)
The determination of the extent to which a rate is "for a period equal in length" to an Interest Period shall disregard any inconsistency arising from the last day of that Interest Period being determined pursuant to the terms of this Agreement.
 
(c)
Section, Clause and Schedule headings are for ease of reference only and are not to be used for the purposes of construction or interpretation of the Finance Documents.
 
(d)
Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under, or in connection with, any Finance Document has the same meaning in that Finance Document or notice as in this Agreement.
 
(e)
A Potential Event of Default is "continuing" if it has not been remedied or waived and an Event of Default is "continuing" if it has not been waived.
 
1.3
Construction of insurance terms
 
In this Agreement:
 
"approved" means, for the purposes of Clause 21 (Insurance Undertakings), approved in writing by the Lender;
 
"excess risks" means the proportion of claims for general average, salvage and salvage charges not recoverable under the hull and machinery policies in respect of the Ship in consequence of its insured value being less than the value at which the Ship is assessed for the purpose of such claims;
 
"obligatory insurances" means all insurances effected, or which the Borrower is obliged to effect, under Clause 21 (Insurance Undertakings) or any other provision of this Agreement or of another Finance Document;
 
"policy" includes a slip, cover note, certificate of entry or other document evidencing the contract of insurance or its terms;
 
"protection and indemnity risks" means the usual risks covered by a protection and indemnity association which is a member of the International Group of protection and indemnity associations, including pollution risks and the proportion (if any) of any sums payable to any other person or persons in case of collision which are not recoverable under the hull and machinery policies by reason of the incorporation in them of clause 6 of the International Hull Clauses (1/11/02) (1/11/03), clause 8 of the Institute Time Clauses (Hulls) (1/10/83) (1/11/95) or the Institute Amended Running Down Clause (1/10/71) or any equivalent provision; and
 
"war risks" includes the risk of mines and all risks excluded by clauses 29, 30 or 31 of the International Hull Clauses (1/11/02), clauses 29 or 30 of the International Hull Clauses (1/11/03), clauses 24, 25 or 26 of the Institute Time Clauses (Hulls) (1/11/95) or clauses 23, 24 or 25 of the Institute Time Clauses (Hulls) (1/10/83) or any equivalent provision.
 
1.4
Agreed forms of Finance Documents
 
References in Clause 1.1 (Definitions) to any Finance Document being in "agreed form" are to that Finance Document:
 
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28 SinoPac Capital – Facility Agreement
(a)
in a form attached to a certificate dated the same date as this Agreement (and signed by the Borrower and the Lender); or
 
(b)
in any other form agreed in writing between the Borrower and the Lender.
 
1.5
Third party rights
 
(a)
Unless expressly provided to the contrary in a Finance Document, a person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 (the "Third Parties Act") to enforce or to enjoy the benefit of any term of this Agreement.
 
(b)
Notwithstanding any term of any Finance Document, the consent of any person who is not a Party is not required to rescind or vary this Agreement at any time.
 
(c)
Any Affiliate, Receiver, Delegate or any other person described in paragraph (f) of Clause 14.2 (Other indemnities) may, subject to this Clause 1.5 (Third party rights) and the Third Parties Act, rely on any Clause of this Agreement which expressly confers rights on it.
 
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SECTION 2

THE FACILITY
 
2
THE FACILITY
 
Subject to the terms of this Agreement, the Lender makes available to the Borrower a dollar secured term loan facility in an amount equal to the lower of (i) $16,500,000 and (ii) 72.5% of the Fair Market Value of the Ship as at the Utilisation Date.
 
3
PURPOSE
 
3.1
Purpose
 
The Borrower shall apply all amounts borrowed by it under the Facility only for the purpose stated in the preamble (Background) to this Agreement.
 
3.2
Monitoring
 
The Lender is not bound to monitor or verify the application of any amount borrowed pursuant to this Agreement.
 
4
CONDITIONS OF UTILISATION
 
4.1
Initial conditions precedent
 
The Borrower may not deliver the Utilisation Request unless the Lender has received all of the documents and other evidence listed in Part A of Schedule 2 (Conditions Precedent and Conditions Subsequent) in form and substance satisfactory to the Lender.
 
4.2
Further conditions precedent
 
(a)
The Lender will only be obliged to comply with Clause 5.4 (Loan) if on the date of the Utilisation Request, on the proposed Utilisation Date and the Release Date and before the Loan is made available:
 

 (i)
no Default has occurred and is continuing or would result from the proposed Loan;
 

 (ii)
the Repeating Representations to be made by each Transaction Obligor are true;
 

 (iii)
the Ship has not become a Total Loss;
 

 (iv)
no event or series of events has occurred which is likely to have a Material Adverse Effect; and
 

 (v)
no event has occurred which would give rise to the provisions of Clause 10.3 (Cost of funds); and
 
(b)
the Lender has received:
 

 (i)
on or before the Utilisation Date, or is satisfied it will receive when the Loan is made available, all of the documents and other evidence listed in Part B of Schedule 2 (Conditions Precedent and Conditions Subsequent) in form and substance satisfactory to the Lender; and
 
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30 SinoPac Capital – Facility Agreement

(ii)
on or before the Release Date, or is satisfied it will receive when the Prepositioned Amount is released by the Escrow Agent, all of the documents and other evidence listed in Part C of Schedule 2 (Conditions Precedent and Conditions Subsequent) in form and substance satisfactory to the Lender.
 
4.3
Notification of satisfaction of conditions precedent
 
The Lender shall notify the Borrower promptly upon being satisfied as to the satisfaction of the conditions precedent referred to in Clause 4.1 (Initial conditions precedent) and Clause 4.2 (Further conditions precedent).
 
4.4
Conditions subsequent
 
The Borrower shall provide to the Lender all the documents and other evidence listed in Part D of Schedule 2 (Conditions Precedent and Conditions Subsequent) within the timeframe set out therein or such later date as the Lender may agree in writing with the Borrower.
 
4.5
Waiver of conditions precedent and conditions subsequent
 
(a)
If the Lender, at its discretion, permits:
 

 (i)
the Loan or any part thereof to be borrowed before any of the conditions precedent referred to in Clause 4.1 (Initial conditions precedent) or Clause 4.2 (Further conditions precedent) has been satisfied, the Borrower shall ensure that that condition is satisfied by such later date as the Lender may agree in writing with the Borrower; and
 

 (ii)
the Loan or any part thereof to be maintained before any of the conditions subsequent referred to in Clause 4.4 (Conditions subsequent) has been satisfied, the Borrower shall ensure that that condition is satisfied by such later date as the Lender may agree in writing with the Borrower.
 
(b)
The conditions precedent and subsequent set out in this Clause 4 are inserted for the sole benefit of the Lender and may be waived in whole or in part and with or without conditions by the Lender without prejudicing the right of the Lender to require fulfilment of such conditions in whole or in part at any time thereafter.
 
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SECTION 3

UTILISATION
 
5
UTILISATION
 
5.1
Delivery of Utilisation Request
 
The Borrower may make one Utilisation only under the Facility by delivery to the Lender of a duly completed Utilisation Request not later than the Specified Time.
 
5.2
Completion of Utilisation Request
 
(a)
The Utilisation Request is irrevocable and will not be regarded as having been duly completed unless:
 

 (i)
the proposed Utilisation Date is a Business Day within the Availability Period;
 

 (ii)
the currency and amount of the Loan comply with Clause 5.3 (Currency and amount);
 

 (iii)
all applicable deductible items have been completed; and
 

 (iv)
the proposed Interest Period complies with Clause 9 (Interest Periods).
 
(b)
Only one Utilisation may be requested in the Utilisation Request.
 
5.3
Currency and amount
 
(a)
The currency specified in the Utilisation Request must be dollars.
 
(b)
The amount of the proposed Loan must be an amount which is the lower of (i) $16,500,000 and (ii) 72.5% of the Fair Market Value of the Ship as at the Utilisation Date.
 
5.4
Loan
 
If the conditions set out in this Agreement have been met, the Lender shall make the Loan available by the Utilisation Date through its Facility Office.
 
5.5
Cancellation of Commitment
 
On the earlier of:
 
(a)
the date on which the Loan has been made; and
 
(b)
the end of the Availability Period,
 
any part of the Commitment which is then unutilised shall be cancelled.
 
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5.6
Retentions and Payments to third parties
 
The Borrower irrevocably authorises the Lender:
 
(a)
to deduct from the proceeds of the Loan any fees then payable to the Lender in accordance with Clause 11 (Fees) and any other items listed as deductible items in the Utilisation Request and to apply them in payment of the items to which they relate; and
 
(b)
on the Utilisation Date, to pay to, or for the account of, the Borrower the balance (after any deduction made in accordance with paragraph (a) above) of the Loan. That payment shall be made to the account which the Borrower specifies in the Utilisation Request, subject to the provisions of Clause 4.2 (Further conditions precedent) and Clause 4.3 (Notification of satisfaction of conditions precedent).
 
5.7
Disbursement of Loan to third party
 
Payment by the Lender under Clause 5.6 (Retentions and Payments to third parties) to a person other than the Borrower shall constitute the making of the Loan and the Borrower shall at that time become indebted, as principal and direct obligor, to the Lender in an amount equal to the Loan.
 
5.8
Advance of Loan
 
(a)
If requested by the Borrower in the Utilisation Request, the Lender shall preposition the Loan or the balance of the Loan (after any deduction made in accordance with paragraph (a) of Clause 5.6 (Retentions and Payments to third parties)) (the “Prepositioned Amount”) with the Escrow Agent by remitting the Prepositioned Amount to the Escrow Account on the Utilisation Date.
 
(b)
The Borrower shall procure that the Prepositioned Amount shall be held by the Escrow Agent in accordance with the terms of the Escrow Agreement and only be released on the Release Date in accordance with the terms of the Escrow Agreement.
 
(c)
If the Prepositioned Amount is not released within 10 Business Days after the Prepositioning Date:
 

 (i)
the Borrower shall procure the Escrow Agent to promptly return the Prepositioned Amount to the Lender in accordance with the Escrow Agreement;
 

 (ii)
the amount so returned by the Escrow Agent to the Lender shall be held by the Lender as a security deposit until 20 September 2024 (or such later date as may be agreed by the Lender) during which the Borrower may, subject to Clause 4.1 (Initial conditions precedent) and Clause 4.2 (Further conditions precedent), request the Lender to remit such amount in accordance with paragraph (a) above. For the avoidance of doubt, notwithstanding the return of the Prepositioned Amount and the remittance contemplated by this sub-paragraph (ii), the Repayment Dates and the start date of the first Interest Period shall remain unchanged and be based on the Utilisation Date contemplated under paragraph (a); and
 

 (iii)
if the amount so returned by the Escrow Agent to the Lender under sub-paragraph (i) above is not remitted by 20 September 2024 (or such later date as may be agreed by the Lender), such amount shall be applied by the Lender on the next Business Day towards prepayment of the Loan, and the Borrower shall pay to the Lender on the same date all accrued interest and other amounts accrued under the Finance Documents.
 
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5.9
Prepositioning of funds
 
If the Lender, at the request of the Borrower and on terms acceptable to the Lender and in its absolute discretion, agrees to preposition the Prepositioned Amount with the Escrow Agent on the Utilisation Date in accordance with Clause 5.8 (Advance of Loan), the Borrower and the Guarantor shall, without duplication, indemnify the Lender against any costs, loss or liability it may incur in connection with such arrangement.
 
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SECTION 4

REPAYMENT, PREPAYMENT AND CANCELLATION
 
6
REPAYMENT
 
6.1
Repayment of Facility
 
(a)
Subject to Clause 6.2 (Reduction), the Borrower shall repay the Loan by twenty (20) consecutive quarterly instalments (each a "Repayment Instalment"), each in an amount equal to $400,000 and in the case of the 20th Repayment Instalment, be paid together with a balloon amount equivalent to $8,500,000 (the "Balloon Amount").
 
(b)
The Repayment Instalments and Balloon Amount for the Loan shall be paid on the following dates:
 

 (i)
the first Repayment Instalment shall be repaid on the date falling three Months after the Utilisation Date;
 

 (ii)
each subsequent Repayment Instalment shall be repaid at quarterly intervals thereafter; and
 

 (iii)
the 20th Repayment Instalment shall be paid together with the Balloon Amount on the Termination Date.
 
6.2
Reduction
 
(a)
If the amount of the Loan advanced is less than $16,500,000, each Repayment Instalment and the Balloon Amount shall be reduced pro rata by an amount equal to the undrawn amount.
 
(b)
If any part of the Facility is cancelled, the Repayment Instalments falling after that cancellation and the Balloon Amount shall be reduced pro rata by the amount cancelled.
 
6.3
Termination Date
 
On the Termination Date, the Borrower shall additionally pay to the Lender all other sums then accrued and owing under the Finance Documents.
 
6.4
Reborrowing
 
The Borrower may not reborrow any part of the Facility which is repaid.
 
7
PREPAYMENT AND CANCELLATION
 
7.1
Illegality and Sanctions Laws affecting the Lender
 
(a)
If it becomes unlawful or contrary to Sanctions Laws in any applicable jurisdiction for the Lender to perform any of its obligations as contemplated by this Agreement or to fund or maintain all or any part of the Loan or it becomes unlawful for any Affiliate of the Lender for the Lender to do so:
 
(b)
the Lender shall promptly notify the Borrower upon becoming aware of that event and the Available Facility will be immediately cancelled;
 
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(c)
the Borrower shall prepay the Loan on the last day of the Interest Period for the Loan occurring after the Lender has notified the Borrower or, if earlier, the date specified by the Lender in the notice delivered to the Borrower (being no earlier than the last day of any applicable grace period permitted by law) and the Commitment shall be cancelled; and
 
(d)
accrued interest and all other amounts accrued for the Lender under the Finance Documents shall be immediately due and payable.
 
7.2
Voluntary prepayment of Loan
 
(a)
The Borrower may, if it gives the Lender not less than 10 Business Days' (or such shorter period as the Lender may agree) prior written notice, prepay the whole or any part of the Loan (but, if in part, being an amount that reduces the amount of the Loan by a minimum amount of $500,000).
 
(b)
The Loan may only be prepaid under this Clause 7.2 (Voluntary prepayment of Loan) after the first anniversary of the Utilisation Date.
 
(c)
Any partial prepayment under this Clause 7.2 (Voluntary prepayment of Loan) shall be applied in inverse order of maturity or pro rata (at the Borrower’s discretion) against the Balloon Amount and the remaining Repayment Instalments falling due after the day of such repayment.
 
7.3
Mandatory prepayment on sale or Total Loss
 
(a)
If the Ship is sold (without prejudice to paragraph (a) of Clause 20.12 (Disposals)) or becomes a Total Loss, the Borrower shall on the Relevant Date prepay the Loan together with accrued interest, and all other amounts accrued under the Finance Documents.
 
(b)
In this Clause 7.3 (Mandatory prepayment on sale or Total Loss):
 
"Relevant Date" means:
 

 (i)
in the case of a sale of the Ship, on or before the date on which the sale is completed by delivery of the Ship to the buyer of the Ship; or
 

 (ii)
in the case of a Total Loss, on the earlier of:
 

 (A)
the date falling 120 days after the Total Loss Date; and
 

 (B)
the date of receipt by the Lender of the proceeds of insurance relating to such Total Loss.
 
7.4
Restrictions
 
(a)
Any notice of cancellation or prepayment given by any Party under this Clause 7 (Prepayment and Cancellation) shall be irrevocable and given not less than 10 Business Days in writing, and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant cancellation or prepayment is to be made, the amount of that cancellation or prepayment and the order of application.
 
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(b)
Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid in connection with that prepayment and, subject to the fee provided for in Clause 11.2 (Prepayment fee) and any Break Costs, without premium or penalty.
 
(c)
The Borrower may not reborrow any part of the Facility which is prepaid.
 
(d)
The Borrower shall not repay or prepay all or any part of the Loan or cancel all or any part of the Commitment except at the times and in the manner expressly provided for in this Agreement.
 
(e)
No amount of the Commitment cancelled under this Agreement may be subsequently reinstated.
 
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SECTION 5

COSTS OF UTILISATION
 
8
INTEREST
 
8.1
Calculation of interest
 
The rate of interest on the Loan or any part of the Loan for each Interest Period is the percentage rate per annum which is the aggregate of:
 
(a)
the Margin; and
 
(b)
the applicable Reference Rate.
 
8.2
Payment of interest
 
The Borrower shall pay accrued interest on the Loan or any part of the Loan on the last day of each Interest Period.
 
8.3
Default interest
 
(a)
If a Transaction Obligor fails to pay any amount payable by it under a Finance Document on its due date, interest shall accrue on the Unpaid Sum from the due date up to the date of actual payment (both before and after judgment) at a rate which, subject to paragraph (b) below, is two per cent. (2%) per annum higher than the rate which would have been payable if the Unpaid Sum had, during the period of non-payment, constituted part of the Loan, in the currency of the Unpaid Sum for successive Interest Periods, each of a duration selected by the Lender. Any interest accruing under this Clause 8.3 (Default interest) shall be immediately payable by an Obligor on demand by the Lender.
 
(b)
If an Unpaid Sum consists of all or part of the Loan which became due on a day which was not the last day of an Interest Period relating to the Loan or that part of the Loan:
 

 (i)
the first Interest Period for that Unpaid Sum shall have a duration equal to the unexpired portion of the current Interest Period relating to the Loan or that part of the Loan; and
 

 (ii)
the rate of interest applying to that Unpaid Sum during that first Interest Period shall be two per cent. (2%) per annum higher than the rate which would have applied if that Unpaid Sum had not become due.
 
(c)
Default interest (if unpaid) arising on an Unpaid Sum will be compounded with the Unpaid Sum at the end of each Interest Period applicable to that Unpaid Sum but will remain immediately due and payable.
 
8.4
Notification of rates of interest
 
The Lender shall promptly notify the Borrower of the determination of a rate of interest under this Agreement.
 
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9
INTEREST PERIODS
 
9.1
Selection of Interest Periods
 
(a)
Subject to this Clause 9 (Interest Periods), each Interest Period will be three (3) Months unless otherwise agreed in writing between the Lender and the Borrower.
 
(b)
No Interest Period shall extend beyond the Termination Date.
 
(c)
The first Interest Period for the Loan shall start on the Utilisation Date and each subsequent Interest Period shall start on the day immediately following the last day of the preceding Interest Period.
 
9.2
Non-Business Days
 
If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).
 
10
CHANGES TO THE CALCULATION OF INTEREST
 
10.1
Unavailability of Term SOFR
 
(a)
Interpolated Term SOFR:  If no Term SOFR is available for the Interest Period of the Loan or any part of the Loan, the applicable Reference Rate shall be the Interpolated Term SOFR for a period equal in length to the Interest Period of the Loan or that part of the Loan.
 
(b)
Historic Term SOFR: If no Term SOFR is available for the Interest Period of the Loan or any part of the Loan and it is not possible to calculate the Interpolated Term SOFR, the applicable Reference Rate shall be the Historic Term SOFR for the Loan or that part of the Loan.
 
(c)
Interpolated Historic Term SOFR: If paragraph (b) above applies but no Historic Term SOFR is available for the Interest Period of the Loan or any part of the Loan, the applicable Reference Rate shall be the Interpolated Historic Term SOFR for a period equal in length to the Interest Period of the Loan or that part of the Loan.
 
(d)
Cost of funds:  If paragraph (c) above applies but it is not possible to calculate the Interpolated Historic Term SOFR, there shall be no Reference Rate for the Loan or that part of the Loan (as applicable) and Clause 10.3 (Cost of funds) shall apply to the Loan or that part of the Loan for that Interest Period.
 
10.2
Market disruption
 
If before close of business in Taipei on the Business Day after the Quotation Day for the relevant Interest Period, the Lender notifies the Borrower that its cost of funds relating to the Loan or the relevant part of the Loan would be in excess of the applicable Reference Rate then Clause 10.3 (Cost of funds) shall apply to the Loan or that part of the Loan (as applicable) for the relevant Interest Period.
 
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10.3
Cost of funds
 
(a)
If this Clause 10.3 (Cost of funds) applies, then the rate of interest of the Loan or the relevant part of the Loan for the Interest Period shall be the percentage rate per annum which is the sum of:
 

 (i)
the Margin; and
 

 (ii)
the rate notified by the Lender to the Borrower as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost of funds to the Lender relating to the Loan or that part of the Loan from whatever source it may reasonably select.
 
(b)
If this Clause 10.3 (Cost of funds) applies and the Lender or the Borrower so requires, the Lender and the Borrower shall enter into negotiations (for a period of not more than 30 days) with a view to agreeing a substitute basis for determining the rate of interest or (as the case may be) an alternative basis for funding.
 
(c)
Subject to Clause 38.2 (Changes to reference rates), any substitute or alternative basis agreed pursuant to paragraph (b) above shall, with the prior consent of the Lender and the Borrower, be binding on all Parties.
 
(d)
If paragraph (e) below does not apply and any Funding Rate is less than zero, the relevant Funding Rate shall be deemed to be zero.
 
(e)
If this Clause 10.3 (Cost of funds) applies pursuant to Clause 10.2 (Market disruption) and:
 

 (i)
the Lender's Funding Rate is less than the Reference Rate; or
 

 (ii)
the Lender does not notify a rate by the time specified in sub-paragraph (ii) of paragraph (a) above,
 
the Lender's cost of funds relating to the Loan or the relevant part of the Loan for that Interest Period shall be deemed, for the purposes of paragraph (a) above, to be the Reference Rate.
 
10.4
Break Costs
 
(a)
The Borrower shall, within three Business Days of demand by the Lender, pay to the Lender its Break Costs attributable to all or any part of the Loan or Unpaid Sum being paid by the Borrower on a day other than the last day of an Interest Period for the Loan, the relevant part of the Loan or that Unpaid Sum.
 
(b)
The Lender shall, as soon as reasonably practicable after a demand by the Borrower, provide a certificate confirming the amount of its Break Costs for any Interest Period in respect of which they become or may become payable.
 
11
FEES
 
11.1
Facility fee
 
The Borrower shall pay to the Lender a non-refundable facility fee in the amount and at the time agreed in a Fee Letter.
 
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11.2
Prepayment fee
 
(a)
Subject to paragraph (c) below, the Borrower must pay to the Lender a prepayment fee on the date of prepayment of all or any part of the Loan.
 
(b)
The amount of the prepayment fee is:
 

 (i)
if the prepayment occurs on or before the second anniversary of the Utilisation Date, one per cent. (1%) of the amount prepaid;
 

 (ii)
if the prepayment occurs after the second anniversary of the Utilisation Date but on or before the forty-second month after the Utilisation Date, zero point five per cent. (0.5%) of the amount prepaid; and
 

 (iii)
if the prepayment occurs after the forty-second month after the Utilisation Date, no prepayment fee shall be payable on the amount prepaid.
 
(c)
No prepayment fee shall be payable under this Clause if the prepayment is made under:
 

 (i)
Clause 7.1 (Illegality and Sanctions affecting the Lender);
 

 (ii)
Clause 7.2 (Voluntary prepayment of Loan) as a result of no substitute basis for determining the rate of interest of, or (as the case may be) an alternative basis for funding, the Loan has been agreed between the Lender and the Borrower after negotiations for 30 days pursuant to paragraph (b) of Clause 10.3 (Cost of funds);
 

 (iii)
Clause 7.3 (Mandatory prepayment on sale or Total Loss) as a result of the Vessel becoming a Total Loss; or
 

 (iv)
Clause 26.2 (Conditions of assignment or transfer) as a result of the refinancing of the Facility by the Borrower in response to an assignment or transfer by the Existing Lender.
 
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SECTION 6

ADDITIONAL PAYMENT OBLIGATIONS
 
12
TAX GROSS UP AND INDEMNITIES
 
12.1
Definitions
 
(a)
In this Agreement:
 
"Tax Credit" means a credit against, relief or remission for, or repayment of any Tax.
 
"Tax Deduction" means a deduction or withholding for or on account of Tax from a payment under a Finance Document, other than a FATCA Deduction.
 
"Tax Payment" means either the increase in a payment made by an Obligor to the Lender under Clause 12.2 (Tax gross-up) or a payment under Clause 12.3 (Tax indemnity).
 
(b)
Unless a contrary indication appears, in this Clause 12 (Tax Gross Up and Indemnities) reference to "determines" or "determined" means a determination made in the absolute discretion of the person making the determination.
 
12.2
Tax gross-up
 
(a)
Each Obligor shall make all payments to be made by it without any Tax Deduction, unless a Tax Deduction is required by law.
 
(b)
The Borrower shall promptly upon becoming aware that an Obligor must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the Lender accordingly. Similarly, the Lender shall notify an Obligor on becoming so aware in respect of a payment payable to the Lender.
 
(c)
If a Tax Deduction is required by law to be made by an Obligor, the amount of the payment due from that Obligor shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.
 
(d)
If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.
 
(e)
Within 30 days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Obligor making that Tax Deduction shall deliver to the Lender evidence reasonably satisfactory to the Lender that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.
 
12.3
Tax indemnity
 
(a)
The Obligors shall (within three Business Days of demand by the Lender) pay to the Lender an amount equal to the loss, liability or cost which the Lender determines will be or has been (directly or indirectly) suffered for or on account of Tax by the Lender in respect of a Finance Document.
 
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(b)
Paragraph (a) above shall not apply:
 

 (i)
with respect to any Tax assessed on the Lender:
 

 (A)
under the law of the jurisdiction in which the Lender is incorporated or, if different, the jurisdiction (or jurisdictions) in which the Lender is treated as resident for tax purposes; or
 

 (B)
under the law of the jurisdiction in which the Lender’s Facility Office is located in respect of amounts received or receivable in that jurisdiction,
 
if that Tax is imposed on or calculated by reference to the net income received or receivable (but not any sum deemed to be received or receivable) by the Lender; or
 

 (ii)
to the extent a loss, liability or cost:
 

 (A)
is compensated for by an increased payment under Clause 12.2 (Tax gross-up); or
 

 (B)
relates to a FATCA Deduction required to be made by a Party.
 
(c)
The Lender shall, if making, or intending to make, a claim under paragraph (a) above promptly notify the Borrower of the event which will give, or has given, rise to the claim.
 
12.4
Tax Credit
 
If an Obligor makes a Tax Payment and the Lender determines that:
 
(a)
a Tax Credit is attributable to an increased payment of which that Tax Payment forms part, to that Tax Payment or to a Tax Deduction in consequence of which that Tax Payment was received; and
 
(b)
the Lender has obtained and utilised that Tax Credit,
 
the Lender shall pay an amount to that Obligor which the Lender determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by that Obligor.
 
12.5
Stamp taxes
 
The Obligors shall pay and, within three Business Days of demand, indemnify the Lender against any cost, loss or liability which the Lender incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document.
 
12.6
VAT
 
(a)
All amounts expressed to be payable under a Finance Document by any Party to the Lender which (in whole or in part) constitute the consideration for any supply for VAT purposes are deemed to be exclusive of any VAT which is chargeable on that supply, and accordingly, if VAT is or becomes chargeable on any supply made by the Lender to any Party under a Finance Document and the Lender is required to account to the relevant tax authority for the VAT, that Party must pay to the Lender (in addition to and at the same time as paying any other consideration for such supply) an amount equal to the amount of the VAT (and the Lender must promptly provide an appropriate VAT invoice to that Party).
 
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(b)
Where a Finance Document requires any Party to reimburse or indemnify the Lender for any cost or expense, that Party shall reimburse or indemnify (as the case may be) the Lender for the full amount of such cost or expense, including such part of it as represents VAT, save to the extent that the Lender reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.
 
(c)
Any reference in this Clause 12.6 (VAT) to any Party shall, at any time when that Party is treated as a member of a group or unity (or fiscal unity) for VAT purposes, include (where appropriate and unless the context otherwise requires) a reference to the person who is treated at that time as making the supply, or (as appropriate) receiving the supply, under the grouping rules provided for in Article 11 of Council Directive 2006/112/EC (or as implemented by the relevant member state of the European Union or equivalent provisions imposed elsewhere) so that a reference to a Party shall be construed as a reference to that Party or the relevant group or unity (or fiscal unity) of which that Party is a member for VAT purposes at the relevant time or the relevant representative member (or representative or head) of that group or unity at the relevant time (as the case may be).
 
(d)
In relation to any supply made by the Lender to any Party under a Finance Document, if reasonably requested by the Lender, that Party must promptly provide the Lender with details of that Party's VAT registration and such other information as is reasonably requested in connection with the Lender’s VAT reporting requirements in relation to such supply.
 
12.7
FATCA Information
 
(a)
Subject to paragraph (c) below, each Party shall, within ten Business Days of a reasonable request by another Party:
 

 (i)
confirm to that other Party whether it is:
 

 (A)
a FATCA Exempt Party; or
 

 (B)
not a FATCA Exempt Party;
 

 (ii)
supply to that other Party such forms, documentation and other information relating to its status under FATCA as that other Party reasonably requests for the purposes of that other Party's compliance with FATCA; and
 

 (iii)
supply to that other Party such forms, documentation and other information relating to its status as that other Party reasonably requests for the purposes of that other Party's compliance with any other law, regulation or exchange of information regime.
 
(b)
If a Party confirms to another Party pursuant to sub-paragraph (i) of paragraph (a) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, that Party shall notify that other Party reasonably promptly.
 
(c)
Paragraph (a) above shall not oblige the Lender to do anything, and sub-paragraph (iii) of paragraph (a) above shall not oblige any other Party to do anything, which would or might in its reasonable opinion constitute a breach of:
 

 (i)
any law or regulation;
 
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(ii)
any fiduciary duty; or
 

 (iii)
any duty of confidentiality.
 
(d)
If a Party fails to confirm whether or not it is a FATCA Exempt Party, or to supply forms, documentation or other information requested in accordance with sub-paragraph (i) or (ii) of paragraph (a) above (including, for the avoidance of doubt, where paragraph (c) above applies), then such Party shall be treated for the purposes of the Finance Documents (and payments under them) as if it is not a FATCA Exempt Party until such time as the Party in question provides the requested confirmation, forms, documentation or other information.
 
12.8
FATCA Deduction
 
(a)
Each Party may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no Party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.
 
(b)
Each Party shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction), notify the Party to whom it is making the payment.
 
13
INCREASED COSTS
 
13.1
Increased costs
 
(a)
Subject to Clause 13.3 (Exceptions), the Borrower shall, within three Business Days of a demand by the Lender, pay for the account of the Lender the amount of any Increased Costs incurred by the Lender or any of its Affiliates as a result of:
 

 (i)
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation; or
 

 (ii)
compliance with any law or regulation made,
 
in each case after the date of this Agreement; or
 

 (iii)
the implementation, application of or compliance with Basel III or CRD IV or any law or regulation that implements or applies Basel III or CRD IV.
 
(b)
In this Agreement:
 

 (i)
"Basel III" means:
 

 (A)
the agreements on capital requirements, a leverage ratio and liquidity standards contained in "Basel III: A global regulatory framework for more resilient banks and banking systems", "Basel III: International framework for liquidity risk measurement, standards and monitoring" and "Guidance for national authorities operating the countercyclical capital buffer" published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated;
 
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(B)
the rules for global systemically important banks contained in "Global systemically important banks: assessment methodology and the additional loss absorbency requirement - Rules text" published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented or restated; and
 

 (C)
any further guidance or standards published by the Basel Committee on Banking Supervision relating to "Basel III".
 

 (ii)
"CRD IV" means:
 

 (A)
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending regulation (EU) No. 648/2012, as amended by, amongst others, Regulation (EU) 2019/876;
 

 (B)
Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, as amended by, amongst others, Directive (EU) 2019/878; and
 

 (C)
any other law or regulation which implements Basel III.
 

 (iii)
"Increased Costs" means:
 

 (A)
a reduction in the rate of return from the Facility or on the Lender's (or its Affiliate's) overall capital;
 

 (B)
an additional or increased cost; or
 

 (C)
a reduction of any amount due and payable under any Finance Document,
 
which is incurred or suffered by the Lender or any of its Affiliates to the extent that it is attributable to the Lender having entered into the Commitment or funding or performing its obligations under any Finance Document.
 
13.2
Increased cost claims
 
If the Lender intends to make a claim pursuant to Clause 13.1 (Increased costs) it shall notify the Borrower of the event giving rise to the claim.
 
13.3
Exceptions
 
Clause 13.1 (Increased costs) does not apply to the extent any Increased Cost is:
 
(a)
attributable to a Tax Deduction required by law to be made by an Obligor;
 
(b)
attributable to a FATCA Deduction required to be made by a Party;
 
(c)
compensated for by Clause 12.3 (Tax indemnity) (or would have been compensated for under Clause 12.3 (Tax indemnity)  but was not so compensated solely because any of the exclusions in paragraph (b) of Clause 12.3 (Tax indemnity) applied);
 
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(d)
compensated for by any payment made pursuant to Clause 14.3 (Mandatory Cost); or
 
(e)
attributable to the wilful breach by the Lender or its Affiliates of any law or regulation.
 
14
OTHER INDEMNITIES
 
14.1
Currency indemnity
 
(a)
If any sum due from an Obligor under the Finance Documents (a "Sum"), or any order, judgment or award given or made in relation to a Sum, has to be converted from the currency (the "First Currency") in which that Sum is payable into another currency (the "Second Currency") for the purpose of:
 

 (i)
making or filing a claim or proof against that Obligor; or
 

 (ii)
obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,
 
that Obligor shall, as an independent obligation, on demand, indemnify the Lender against any cost, loss or liability arising out of or as a result of the conversion including any discrepancy between (A) the rate of exchange used to convert that Sum from the First Currency into the Second Currency and (B) the rate or rates of exchange available to that person at the time of its receipt of that Sum.
 
(b)
Each Obligor waives any right it may have in any jurisdiction to pay any amount under the Finance Documents in a currency or currency unit other than that in which it is expressed to be payable.
 
14.2
Other indemnities
 
(a)
Each Obligor shall, on demand, indemnify the Lender and any Receiver and Delegate against:
 

 (i)
any cost, loss or liability incurred by it as a result of:
 

 (A)
the occurrence of any Event of Default;
 

 (B)
a failure by a Transaction Obligor to pay any amount due under a Finance Document on its due date;
 

 (C)
funding, or making arrangements to fund, the Loan requested by the Borrower in the Utilisation Request but not made by reason of the operation of any one or more of the provisions of this Agreement (other than by reason of default, negligence or wilful misconduct by the Lender alone);
 

 (D)
the Loan (or part of the Loan) not being prepaid in accordance with a notice of prepayment given by the Borrower;
 

 (E)
investigating any event which it reasonably believes is a Default;
 

 (F)
acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised; or
 

 (G)
instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under the Finance Documents; and
 
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(ii)
any cost, loss or liability (including, without limitation, for negligence or any other category of liability whatsoever) incurred by the Lender (otherwise than by reason of the Lender’s gross  negligence or wilful misconduct) or, in the case of any cost, loss or liability pursuant to Clause 27.8 (Disruption to Payment Systems etc.) notwithstanding the Lender’s negligence, gross negligence or any other category of liability whatsoever but not including any claim based on the fraud of the Lender in acting as Lender under the Finance Documents.
 
(b)
Each Obligor shall, on demand, indemnify the Lender, each Affiliate of the Lender and any Receiver and Delegate and each officer or employee of the Lender or its Affiliate or any Receiver or Delegate (as applicable) (each such person for the purposes of this Clause 14.2 (Other indemnities) an "Indemnified Person"), against any cost, loss or liability (including, without limitation, for negligence or any other category of liability whatsoever) incurred by that Indemnified Person pursuant to or in connection with any litigation, arbitration or administrative proceedings or regulatory enquiry, in connection with or arising out of the entry into and the transactions contemplated by the Finance Documents, having the benefit of any Security constituted by the Finance Documents or which relates to the condition or operation of, or any incident occurring in relation to, the Ship unless such cost, loss or liability is caused by the gross negligence or wilful misconduct of that Indemnified Person.
 
(c)
No Party other than the Lender or the Receiver or Delegate (as applicable) may take any proceedings against any officer, employee or agent of the Lender or the Receiver or Delegate (as applicable) in respect of any claim it might have against the Lender or the Receiver or Delegate or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Transaction Document or any Security Property.
 
(d)
Without limiting, but subject to any limitations set out in paragraph (b) above, the indemnity in paragraph (b) above shall cover any cost, loss or liability incurred by each Indemnified Person in any jurisdiction:
 

 (i)
arising or asserted under or in connection with any law relating to safety at sea, the ISM Code, any Environmental Law or any Sanctions Laws; or
 

 (ii)
in connection with any Environmental Claim.
 
(e)
Each Obligor shall, on demand, indemnify the Lender and every Receiver and Delegate against any cost, loss or liability (including, without limitation, for negligence or any other category of liability whatsoever) incurred by any of them:
 

 (i)
in relation to or as a result of:
 

 (A)
any failure by the Borrower to comply with its obligations under Clause 16 (Costs and Expenses);
 

 (B)
acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised;
 

 (C)
the taking, holding, protection or enforcement of the Finance Documents and the Transaction Security;
 

 (D)
the exercise of any of the rights, powers, discretions, authorities and remedies vested in the Lender and each Receiver and Delegate by the Finance Documents or by law;
 
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(E)
any default by any Transaction Obligor in the performance of any of the obligations expressed to be assumed by it in the Finance Documents;
 

 (F)
any action by any Transaction Obligor which vitiates, reduces the value of, or is otherwise prejudicial to, the Transaction Security; and
 

 (G)
instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under the Finance Documents.
 

 (ii)
which otherwise relates to any of the Security Property or the performance of the terms of this Agreement or the other Finance Documents (otherwise, in each case, than by reason of the Lender’s or Receiver’s or Delegate’s gross negligence or wilful misconduct).
 
(f)
Any Affiliate or Receiver or Delegate or any officer or employee of the Lender or of any of its Affiliates or any Receiver or Delegate (as applicable) may rely on this Clause 14.2 (Other indemnities) subject to Clause 1.5 (Third party rights) and the provisions of the Third Parties Act.
 
14.3
Mandatory Cost
 
The Borrower shall, on demand by the Lender, pay to the Lender, such amount which the Lender certifies in a notice to the Borrower to be its good faith determination of the amount necessary to compensate it for complying with:
 
(a)
if the Lender is lending from a Facility Office in a Participating Member State, the minimum reserve requirements (or other requirements having the same or similar purpose) of the European Central Bank (or any other authority or agency which replaces all or any of its functions) in respect of loans made from that Facility Office; and
 
(b)
if the Lender is lending from a Facility Office in the United Kingdom, any reserve asset, special deposit or liquidity requirements (or other requirements having the same or similar purpose) of the Bank of England (or any other governmental authority or agency) and/or paying any fees to the Financial Conduct Authority and/or the Prudential Regulation Authority (or any other governmental authority or agency which replaces all or any of their functions),
 
which in each case is referable to the Loan.
 
15
MITIGATION BY THE LENDER
 
15.1
Mitigation
 
(a)
The Lender shall, in consultation with the Borrower, take all reasonable steps to mitigate any circumstances which arise and which would result in any amount becoming payable under or pursuant to, or cancelled pursuant to, any of Clause 7.1 (Illegality and Sanctions Laws affecting the Lender), Clause 12 (Tax Gross Up and Indemnities), Clause 13 (Increased Costs) or paragraph (a) of Clause 14.3 (Mandatory Cost) including (but not limited to) assigning or transferring its rights and obligations under the Finance Documents to another Affiliate or Facility Office.
 
(b)
Paragraph (a) above does not in any way limit the obligations of any Transaction Obligor under the Finance Documents.
 
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15.2
Limitation of liability
 
(a)
Each Obligor shall, on demand, indemnify the Lender for all costs and expenses reasonably incurred by the Lender as a result of steps taken by it under Clause 15.1 (Mitigation).
 
(b)
The Lender is not obliged to take any steps under Clause 15.1 (Mitigation) if either:
 

 (i)
a Default has occurred and is continuing; or
 

 (ii)
in the opinion of the Lender (acting reasonably), to do so might be prejudicial to it.
 
16
COSTS AND EXPENSES
 
16.1
Transaction expenses
 
The Obligors shall, on demand, pay the Lender the amount of all reasonable and documented costs and expenses (including reasonable legal fees and disbursements) incurred by the Lender in connection with the negotiation, preparation, printing, execution and perfection of:
 
(a)
this Agreement and any other documents referred to in this Agreement or a Finance Document;
 
(b)
any Transaction Security; and
 
(c)
any other Finance Documents executed after the date of this Agreement.
 
16.2
Amendment costs
 
If:
 
(a)
a Transaction Obligor requests an amendment, waiver or consent; or
 
(b)
an amendment is required either pursuant to Clause 27.6 (Change of currency) or as contemplated in Clause 38.2 (Changes to reference rates); or
 
(c)
a Transaction Obligor requests, and the Lender agrees to, the release of all or any part of the Security Assets from the Transaction Security,
 
the Obligors shall, on demand, reimburse the Lender for the amount of all costs and expenses (including legal fees) reasonably incurred by the Lender in responding to, evaluating, negotiating or complying with that request or requirement.
 
16.3
Enforcement and preservation costs
 
The Obligors shall, on demand, pay to the Lender the amount of all costs and expenses (including legal fees) incurred by the Lender in connection with the enforcement of, or the preservation of any rights under, any Finance Document or the Transaction Security and with any proceedings instituted by or against the Lender as a consequence of it entering into a Finance Document, taking or holding the Transaction Security, or enforcing those rights, including (without limitation) any losses, costs and expenses which the Lender may from time to time sustain, incur or become liable for by reason of the Lender being mortgagee of the Ship and/or a lender to the Borrower, or by reason of the Lender being deemed by any court or authority to be an operator or controller, or in any way concerned in the operation or control, of the Ship.
 
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SECTION 7

GUARANTEE
 
17
GUARANTEE AND INDEMNITY
 
17.1
Guarantee and indemnity
 
The Guarantor irrevocably and unconditionally:
 
(a)
guarantees to the Lender punctual performance by each Transaction Obligor (other than the Guarantor) of all such other Transaction Obligor’s obligations under the Finance Documents;
 
(b)
undertakes with the Lender that whenever a Transaction Obligor (other than the Guarantor) does not pay any amount when due under or in connection with any Finance Document, the Guarantor shall immediately on demand pay that amount as if it were the principal obligor; and
 
(c)
agrees with the Lender that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify the Lender immediately on demand against any cost, loss or liability it incurs as a result of a Transaction Obligor (other than the Guarantor) not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by it under any Finance Document on the date when it would have been due. The amount payable by the Guarantor under this indemnity will not exceed the amount it would have had to pay under this Clause 17 (Guarantee and Indemnity) if the amount claimed had been recoverable on the basis of a guarantee.
 
17.2
Continuing guarantee
 
This guarantee is a continuing guarantee and will extend to the ultimate balance of sums payable by any Transaction Obligor under the Finance Documents, regardless of any intermediate payment or discharge in whole or in part.
 
17.3
Reinstatement
 
If any discharge, release or arrangement (whether in respect of the obligations of any Transaction Obligor or any security for those obligations or otherwise) is made by the Lender in whole or in part on the basis of any payment, security or other disposition which is avoided or must be restored in insolvency, liquidation, administration or otherwise, without limitation, then the liability of the Guarantor under this Clause 17 (Guarantee and Indemnity) will continue or be reinstated as if the discharge, release or arrangement had not occurred.
 
17.4
Waiver of defences
 
The obligations of the Guarantor under this Clause 17 (Guarantee and Indemnity) and in respect of any Transaction Security will not be affected or discharged by an act, omission, matter or thing which, but for this Clause 17.4 (Waiver of defences), would reduce, release or prejudice any of its obligations under this Clause 17 (Guarantee and Indemnity) or in respect of any Transaction Security (without limitation and whether or not known to it or the Lender) including:
 
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(a)
this Agreement being or later becoming void, unenforceable or illegal as regards the Borrower or the Guarantor;
 
(b)
the Lender entering into any rescheduling, refinancing or other arrangement of any kind with the Borrower or the Guarantor;
 
(c)
the Lender releasing the Borrower or the Guarantor or any Security created by a Finance Document;
 
(d)
any time, waiver or consent granted to, or composition with, any Transaction Obligor or other person;
 
(e)
the release of any other Transaction Obligor or any other person under the terms of any composition or arrangement with any creditor of any member of the Group;
 
(f)
the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect or delay in perfecting, or refusal or neglect to take up or enforce, or delay in taking or enforcing any rights against, or security over assets of, any Transaction Obligor or other person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;
 
(g)
any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of a Transaction Obligor or any other person;
 
(h)
any amendment, novation, supplement, extension, restatement (however fundamental and whether or not more onerous) or replacement of any Finance Document or any other document or security including, without limitation, any change in the purpose of, any extension of or any increase in any facility or the addition of any new facility under any Finance Document or other document or security;
 
(i)
any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document or any other document or security; or
 
(j)
any insolvency or similar proceedings.
 
17.5
Immediate recourse
 
The Guarantor waives any right it may have of first requiring the Lender (or any trustee or agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person (including without limitation to commence any proceedings under any Finance Document or to enforce any Transaction Security) before claiming or commencing proceedings under this Clause 17 (Guarantee and Indemnity). This waiver applies irrespective of any law or any provision of a Finance Document to the contrary.
 
17.6
Appropriations
 
Until all amounts which may be or become payable by the Transaction Obligors under or in connection with the Finance Documents have been irrevocably paid in full, the Lender (or any trustee or agent on its behalf) may:
 
(a)
refrain from applying or enforcing any other moneys, security or rights held or received by the Lender (or any trustee or agent on its behalf) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and the Guarantor shall not be entitled to the benefit of the same; and
 
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(b)
hold in an interest-bearing suspense account any moneys received from the Guarantor or on account of the Guarantor's liability under this Clause 17 (Guarantee and Indemnity).
 
17.7
Deferral of Guarantor's rights
 
All rights which the Guarantor at any time has (whether in respect of this guarantee, a mortgage or any other transaction) against the Borrower, any other Transaction Obligor or their respective assets shall be fully subordinated to the rights of the Lender under the Finance Documents and until the end of the Security Period and unless the Lender otherwise directs, the Guarantor will not exercise any rights which it may have (whether in respect of any Finance Document to which it is a Party or any other transaction) by reason of performance by it of its obligations under the Finance Documents or by reason of any amount being payable, or liability arising, under this Clause 17 (Guarantee and Indemnity):
 
(a)
to be indemnified by a Transaction Obligor;
 
(b)
to claim any contribution from any third party providing security for, or any other guarantor of, any Transaction Obligor's obligations under the Finance Documents;
 
(c)
to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Lender under the Finance Documents or of any other guarantee or security taken pursuant to, or in connection with, the Finance Documents by the Lender;
 
(d)
to bring legal or other proceedings for an order requiring any Transaction Obligor to make any payment, or perform any obligation, in respect of which the Guarantor has given a guarantee, undertaking or indemnity under Clause 17.1 (Guarantee and Indemnity);
 
(e)
to exercise any right of set-off against any Transaction Obligor; and/or
 
(f)
to claim or prove as a creditor of any Transaction Obligor in competition with the Lender.
 
If the Guarantor receives any benefit, payment or distribution in relation to such rights it shall hold that benefit, payment or distribution to the extent necessary to enable all amounts which may be or become payable to the Lender by the Transaction Obligors under or in connection with the Finance Documents to be repaid in full on trust for the Lender and shall promptly pay or transfer the same to the Lender or as the Lender may direct for application in accordance with Clause 27 (Payment Mechanics).
 
17.8
Additional security
 
This guarantee and any other Security given by the Guarantor is in addition to and is not in any way prejudiced by, and shall not prejudice, any other guarantee or Security or any other right of recourse now or subsequently held by the Lender or any right of set-off or netting or right to combine accounts in connection with the Finance Documents.
 
17.9
Applicability of provisions of Guarantee to other Security
 
Clauses 17.2 (Continuing guarantee), 17.3 (Reinstatement), 17.4 (Waiver of defences), 17.5 (Immediate recourse), 17.6 (Appropriations), 17.7 (Deferral of Guarantor's rights) and 17.8 (Additional security) shall apply, with any necessary modifications, to any Security which the Guarantor creates (whether at the time at which it signs this Agreement or at any later time) to secure the Secured Liabilities or any part of them.
 
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 SECTION 8

REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT
 
18
REPRESENTATIONS
 
18.1
General
 
Each Obligor makes and shall procure that each other Transaction Obligor makes the representations and warranties set out in this Clause 18 (Representations) to the Lender on the date of this Agreement.
 
18.2
Status
 
(a)
Each Transaction Obligor is a corporation, duly incorporated and validly existing in good standing under the law of its Original Jurisdiction.
 
(b)
Each Transaction Obligor and, in the case of the Guarantor, each of its Subsidiaries has the power to own its assets and carry on its business as it is being conducted.
 
18.3
Authorised shares and ownership
 
(a)
The Borrower is authorised to issue 500 registered shares of no par value common stock, all of which shares have been issued in registered form and are fully paid and non-assessable.
 
(b)
The legal title to and beneficial interest in the shares in the Borrower is held by the Guarantor, free of any Security (except for Permitted Security) or any other claim.
 
(c)
None of the shares in the Borrower is subject to any option to purchase, pre-emption rights or similar rights.
 
18.4
Binding obligations
 
The obligations expressed to be assumed by it in each Transaction Document to which it is a party are legal, valid, binding and enforceable obligations.
 
18.5
Validity, effectiveness and ranking of Security
 
(a)
Each Finance Document to which it is a party does now or, as the case may be, will upon execution and delivery create, subject to the Perfection Requirements, the Security it purports to create over any assets to which such Security, by its terms, relates, and such Security will, when created or intended to be created, be valid and effective.
 
(b)
No third party has or will have any Security (except for Permitted Security) over any assets that are the subject of any Transaction Security granted by it.
 
(c)
Subject to the Perfection Requirements, the Transaction Security granted by it to the Lender has or will when created or intended to be created have first ranking priority or such other priority it is expressed to have in the Finance Documents and is not subject to any prior ranking or pari passu ranking Security.
 
(d)
No concurrence, consent or authorisation of any person is required for the creation of or otherwise in connection with any Transaction Security.
 
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18.6
Non-conflict with other obligations
 
The entry into and performance by it of, and the transactions contemplated by, each Transaction Document to which it is a party do not and will not conflict with:
 
(a)
any law or regulation applicable to it;
 
(b)
the constitutional documents of any Transaction Obligor; or
 
(c)
any agreement or instrument binding upon it or any such Transaction Obligor or any such Transaction Obligor’s assets or constitute a default or termination event (however described) under any such agreement or instrument.
 
18.7
Power and authority
 
(a)
It has the power to enter into, perform and deliver, and has taken all necessary action to authorise:
 

 (i)
its entry into, performance and delivery of, each Transaction Document to which it is or will be a party and the transactions contemplated by those Transaction Documents; and
 

 (ii)
in the case of the Borrower, the registration of the Ship under the Approved Flag.
 
(b)
No limit on its powers will be exceeded as a result of the borrowing, granting of security or giving of guarantees or indemnities contemplated by the Transaction Documents to which it is a party.
 
18.8
Validity and admissibility in evidence
 
All Authorisations required or desirable:
 
(a)
to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Transaction Documents to which it is a party; and
 
(b)
to make the Transaction Documents to which it is a party admissible in evidence in its Relevant Jurisdictions,
 
have been obtained or effected and are in full force and effect.
 
18.9
Governing law and enforcement
 
(a)
The choice of governing law of each Transaction Document to which it is a party will be recognised and enforced in its Relevant Jurisdictions.
 
(b)
Any judgment or arbitral award obtained in relation to a Transaction Document to which it is a party in the jurisdiction of the governing law of that Transaction Document will be recognised and enforced in its Relevant Jurisdictions.
 
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18.10
Insolvency
 
No:
 
(a)
corporate action, legal proceeding or other procedure or step described in paragraph (a) of Clause 24.8 (Insolvency proceedings); or
 
(b)
creditors' process described in Clause 24.9 (Creditors' process),
 
has been taken or, to its knowledge, threatened in relation to any Transaction Obligor; and none of the circumstances described in Clause 24.7 (Insolvency) applies to any Transaction Obligor.
 
18.11
No filing or stamp taxes
 
Under the laws of its Relevant Jurisdictions it is not necessary that the Finance Documents to which it is a party be registered, filed, recorded, notarised or enrolled with any court or other authority in that jurisdiction or that any stamp, registration, notarial or similar Taxes or fees be paid on or in relation to the Finance Documents to which it is a party or the transactions contemplated by those Finance Documents except any filing, recording or enrolling or any tax or fee payable which is referred to in any legal opinion delivered pursuant to Clause 4 (Conditions of Utilisation) and which will be made or paid promptly after the date of the relevant Finance Document.
 
18.12
Deduction of Tax
 
It is not required to make any Tax Deduction from any payment it may make under any Finance Document to which it is a party.
 
18.13
No default
 
(a)
On the date of this Agreement and on the Utilisation Date, no Event of Default is continuing or might reasonably be expected to result from the making of the Utilisation or the entry into, the performance of, or any transaction contemplated by, any Transaction Document.
 
(b)
No other event or circumstance is outstanding which constitutes a default or a termination event (however described) under any other agreement or instrument which is binding on it or to which its assets are subject, which in each case would be expected to have a Material Adverse Effect.
 
18.14
No misleading information
 
(a)
Any factual information provided by any Transaction Obligor for the purposes of this Agreement was true and accurate in all material respects as at the date it was provided or as at the date (if any) at which it is stated.
 
(b)
The financial projections contained in any such information have been prepared on the basis of recent historical information and on the basis of reasonable assumptions.
 
(c)
Nothing has occurred or been omitted from any such information and no information has been given or withheld that results in any such information being untrue or misleading in any material respect.
 
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18.15
Financial Statements
 
(a)
The Original Financial Statements were prepared in accordance with GAAP consistently applied.
 
(b)
The Original Financial Statements give a true and fair view of (if audited) or fairly represent (if unaudited) of the Obligor’s financial condition as at the end of the relevant financial year and its results of operations during the relevant financial year (consolidated in the case of the Guarantor).
 
(c)
There has been no material adverse change in the assets, business or financial condition of each Obligor (and of the assets, business or consolidated financial condition of the Group, in the case of the Guarantor) since the date of the Original Financial Statements.
 
(d)
Each Obligor’s most recent financial statements delivered pursuant to Clause 19.2 (Financial statements):
 

 (i)
have been prepared in accordance with Clause 19.3 (Requirements as to financial statements); and
 

 (ii)
give a true and fair view of (if audited) or fairly represent (if unaudited) its financial condition as at the end of the relevant financial year and operations during the relevant financial year (consolidated in the case of the Guarantor).
 
(e)
Since the date of the most recent financial statements delivered pursuant to Clause 19.2 (Financial statements) there has been no material adverse change in its business, assets or financial condition (or the business or consolidated financial condition of the Group, in the case of the Guarantor).
 
18.16
Pari passu ranking
 
Its payment obligations under the Finance Documents to which it is a party rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally.
 
18.17
No proceedings pending or threatened
 
(a)
No litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the ISPS Code) of or before any court, arbitral body or agency which, if adversely determined, might reasonably be expected to have a Material Adverse Effect have (to the best of its knowledge and belief (having made due and careful enquiry)) been started or threatened against it or any other Transaction Obligor.
 
(b)
No judgment, arbitral award or order of a court, arbitral tribunal or other tribunal or any order or sanction of any governmental or other regulatory body which might reasonably be expected to have a Material Adverse Effect has (to the best of its knowledge and belief (having made due and careful enquiry)) been made against it or any other Transaction Obligor.
 
18.18
Validity and completeness of the Transaction Documents
 
(a)
Each of the Transaction Documents to which each Transaction Obligor is a party constitutes legal, valid, binding and enforceable obligations of that Transaction Obligor.
 
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(b)
The copies of the Transaction Documents delivered to the Lender before the date of this Agreement are true and complete copies.
 
(c)
No amendments or additions to the Transaction Documents have been agreed (other than in accordance with the terms of this Agreement) nor have any rights under the Transaction Documents been waived.
 
18.19
Valuations
 
(a)
All information supplied by it or on its behalf to an Approved Valuer for the purposes of a valuation delivered to the Lender in accordance with this Agreement was true and accurate as at the date it was supplied or (if appropriate) as at the date (if any) at which it is stated to be given.
 
(b)
It has not omitted to supply any information to an Approved Valuer which, if disclosed, would adversely affect any valuation prepared by such Approved Valuer.
 
(c)
There has been no change to the factual information provided pursuant to paragraph (a) above in relation to any valuation between the date such information was provided and the date of that valuation which, in either case, renders that information untrue or misleading in any material respect.
 
18.20
No breach of laws
 
It has not (and no other Transaction Obligor has) breached any law or regulation which breach has or is reasonably likely to have a Material Adverse Effect.
 
18.21
No Charter
 
The Ship is not subject to any Charter other than a Permitted Charter.
 
18.22
Compliance with Environmental Laws
 
All Environmental Laws relating to the ownership, operation and management of the Ship and the business of each Transaction Obligor (as now conducted and as reasonably anticipated to be conducted in the future) and the terms of all Environmental Approvals have been complied with.
 
18.23
No Environmental Claim
 
No Environmental Claim has been made or threatened against any Transaction Obligor and any member of the Group or the Ship which might reasonably be expected to have a Material Adverse Effect.
 
18.24
No Environmental Incident
 
No Environmental Incident has occurred and no person has claimed that an Environmental Incident has occurred.
 
18.25
ISM and ISPS Code compliance
 
All requirements of the ISM Code and the ISPS Code as they relate to the Borrower, each Approved Manager and the Ship have been complied with.
 
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18.26
Taxes paid
 
(a)
It is not  materially overdue in the filing of any Tax returns and it is not (and no other member of the Group is) overdue in the payment of any amount in respect of Tax.
 
(b)
No claims or investigations are being, or are reasonably likely to be, made or conducted against it with respect to Taxes.
 
18.27
Financial Indebtedness
 
The Borrower does not have any Financial Indebtedness outstanding other than Permitted Financial Indebtedness.
 
18.28
Overseas companies
 
No Transaction Obligor has delivered particulars, whether in its name stated in the Finance Documents or any other name, of any UK Establishment to the Registrar of Companies as required under the Overseas Regulations or, if it has so registered, it has provided to the Lender sufficient details to enable an accurate search against it to be undertaken by the Lender at the Companies Registry.
 
18.29
Good title to assets
 
Each Transaction Obligor has good, valid and marketable title to, or valid leases or licences of, and all appropriate Authorisations to use, the assets necessary to carry on its business as presently conducted.
 
18.30
Ownership
 
(a)
On the Release Date, the Borrower will be the sole legal and beneficial owner of the Ship, the Earnings and the Insurances.
 
(b)
With effect on and from the date of its creation or intended creation, each Transaction Obligor will be the sole legal and beneficial owner of any asset that is the subject of any Transaction Security created or intended to be created by such Transaction Obligor.
 
(c)
The constitutional documents of each Transaction Obligor do not and could not restrict or inhibit any transfer of the shares of the Borrower on creation or enforcement of the security conferred by the Security Documents.
 
18.31
Centre of main interests and establishments
 
For the purposes of The Council of the European Union Regulation No. 2015/848 on Insolvency Proceedings (recast) (the "Regulation"), each Obligor’s centre of main interest (as that term is used in Article 3(1) of the Regulation) is situated at the address for communication stated in, Schedule 1, Part A (The Obligors) and it has no "establishment" (as that term is used in Article 2(10) of the Regulation) in any other jurisdiction.
 
18.32
Place of business
 
No Obligor has a place of business in any country other than the Hellenic Republic of Greece and its head office functions are carried out in each case at the address of communication stated in Schedule 1, Part A (The Obligors).
 
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18.33
No employee or pension arrangements
 
No Obligor has any employees or any liabilities under any pension scheme.
 
18.34
Sanctions Laws
 
Each Transaction Obligor has been and is in compliance with all Sanctions Laws and no Transaction Obligor:
 
(a)
is a Restricted Party, or is involved in any transaction through which it is likely to become a Restricted Party; or
 
(b)
has received formal notice in writing of any inquiry, claim, action, suit, proceeding or investigation against it with respect to Sanctions Laws.
 
18.35
Anti-corruption and anti-money laundering obligations
 
(a)
No Transaction Obligor, nor any of their Subsidiaries has engaged in any activity or conduct which would breach any applicable anti-bribery and anti-money laundering laws or regulations and it has instituted and maintained policies and procedures designed to promote and achieve compliance with such laws and regulations.
 
(b)
Each Obligor has conducted its business in compliance with any applicable Business Ethics Laws and has instituted and maintained policies and procedures designed to promote and achieve compliance with such laws.
 
(c)
Without prejudice to any other provision of this Agreement, in relation to the performance and discharge by each Transaction Obligor of its obligations and liabilities under the Finance Documents to which it is a party and the transactions and other arrangements effected or contemplated by the Finance Documents to which any Transaction Obligor is a party, that each Transaction Obligor is acting for their own account and that the foregoing will not involve or lead to contravention of any law, official requirement or other regulatory measure or procedure implemented to combat "money laundering" (as defined in Article 1 of the Directive (2015/849/EC) of the Council of the European Communities.
 
18.36
Anti-terrorism
 
No Transaction Obligor, nor any of their Subsidiaries has engaged in any activity or conduct which would violate any anti-terrorism laws applicable to it.
 
18.37
US Tax Obligor
 
No Transaction Obligor is a US Tax Obligor.
 
18.38
No rebates etc.
 
There is no agreement or understanding to allow or pay any rebate, premium, inducement, commission, discount or other benefit or payment (however described) to the Borrower or any other member of the Group, the Seller or a third party in connection with the purchase by the Borrower of the Ship, other than as disclosed to the Lender in writing on or before the date of this Agreement.
 
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18.39
Repetition
 
The Repeating Representations are deemed to be made by each Obligor by reference to the facts and circumstances then existing on the date of the Utilisation Request and the first day of each Interest Period.
 
19
INFORMATION UNDERTAKINGS
 
19.1
General
 
The undertakings in this Clause 19 (Information Undertakings) remain in force throughout the Security Period unless the Lender otherwise permits.
 
19.2
Financial statements
 
The Obligors shall supply to the Lender:
 
(a)
as soon as they become available, but in any event within 180 days after the end of each of its respective financial years:
 

 (i)
the unaudited financial statements of the Borrower for that financial year; and
 

 (ii)
the audited consolidated financial statements of the Guarantor for that financial year; and
 
(b)
as soon as the same become available, but in any event within 90 days after the end of each half of each of the Borrower's financial years the unaudited financial statements of the Borrower for that financial half year.
 
19.3
Requirements as to financial statements
 
(a)
Each set of financial statements delivered by the Borrower pursuant to Clause 19.2 (Financial statements) shall be certified by a director or an officer of the relevant company as giving a true and fair view of (if audited) or fairly representing (if unaudited) its financial condition and operations as at the date as at which those financial statements were drawn up.
 
(b)
The Borrower shall procure that each set of financial statements of an Obligor delivered pursuant to Clause 19.2 (Financial statements) is prepared using GAAP, accounting practices and financial reference periods consistent with those applied in the preparation of the Original Financial Statements for that Obligor unless, in relation to any set of financial statements, it notifies the Lender that there has been a change in GAAP, the accounting practices or reference periods and its auditors (or, if appropriate, the auditors of the Obligor) deliver to the Lender:
 

 (i)
a description of any change necessary for those financial statements to reflect the GAAP, accounting practices and reference periods upon which that Obligor's Original Financial Statements were prepared; and
 

 (ii)
sufficient information, in form and substance as may be reasonably required by the Lender, to make an accurate comparison between the financial position indicated in those financial statements and that Obligor's Original Financial Statements.
 
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Any reference in this Agreement to those financial statements shall be construed as a reference to those financial statements as adjusted to reflect the basis upon which the Original Financial Statements were prepared.
 
19.4
Information: miscellaneous
 
Each Obligor shall and shall procure that each other Transaction Obligor shall supply to the Lender:
 
(a)
all documents dispatched by the Borrower or the Guarantor to its shareholders (or any class of them) or to its creditors generally at the same time as they are dispatched;
 
(b)
promptly upon becoming aware of them, the details of any litigation, arbitration or administrative proceedings or investigations (including proceedings or investigations relating to any alleged or actual breach of the ISM Code or of the ISPS Code or in connection with any breach of any Sanctions Laws) which are current, threatened or pending against any Transaction Obligor, and which might, if adversely determined reasonably, have a Material Adverse Effect;
 
(c)
promptly upon becoming aware of them, the details of any judgment or order of a court, arbitral body or agency or other tribunal or any order or sanction of any governmental or other regulatory body made against any Transaction Obligor which if adversely determined reasonably, and which might have a Material Adverse Effect;
 
(d)
promptly, its constitutional documents where these have been amended or varied;
 
(e)
promptly, such further information and/or documents regarding:
 

 (i)
the Ship, goods transported on the Ship, the Earnings and the Insurances;
 

 (ii)
the Security Assets;
 

 (iii)
compliance of the Transaction Obligors with the terms of the Finance Documents;
 

 (iv)
the financial condition, business, affairs, commitments and operations of any Transaction Obligor and any member of the Group irrespective of their shareholding structure,
 
as the Lender may reasonably request; and
 
(f)
promptly in writing, the details of any Transaction Obligor or any of their Subsidiaries or any of their respective directors, officers or employees who have become a Restricted Party; and
 
(g)
promptly, such further information and/or documents as the Lender may reasonably request so as to enable the Lender to comply with any laws applicable to it or as may be required by any regulatory authority (including, without limitation, compliance with FATCA).
 
19.5
Information: sanctions
 
The Obligors shall:
 
(a)
supply to the Lender, promptly upon becoming aware of them, the details of any formal inquiry, claim, action, suit, proceeding or investigation pursuant to Sanction Laws against (i) the Borrower or (ii) any other Transaction Obligor, as well as information on what steps are being taken with regards to answering or opposing the same;
 
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(b)
inform the Lender promptly upon becoming aware that any of (i) the Borrower, (ii) any other Transaction Obligor or (iii) any owners of any Transaction Obligor (other than any owner of the Borrower), has become or is likely to become a Restricted Party.
 
19.6
Notification of Default
 
(a)
Each Obligor shall, and shall procure that each other Transaction Obligor shall, notify the Lender of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its occurrence (unless that Obligor is aware that a notification has already been provided by another Obligor).
 
(b)
Promptly upon a request by the Lender, the Borrower shall supply to the Lender a certificate signed by two of its directors or senior officers on its behalf certifying that no Default is continuing (or if a Default is continuing, specifying the Default and the steps, if any, being taken to remedy it).
 
19.7
DAC6
 
(a)
In this Clause 19.7 (DAC6), "DAC6" means the Council Directive of 25 May 2018 (2018/822/EU) amending Directive 2011/16/EU.
 
(b)
The Obligors shall supply to the Lender:
 

 (i)
promptly upon the making of such analysis or the obtaining of such advice, any analysis made or advice obtained on whether any transaction contemplated by the Transaction Documents or any transaction carried out (or to be carried out) in connection with any transaction contemplated by the Transaction Documents contains a hallmark as set out in Annex IV of DAC6 or is required to be disclosed pursuant to The International Tax Enforcement (Disclosable Arrangements) Regulations 2023; and
 

 (ii)
promptly upon the making of such reporting and to the extent permitted by applicable law and regulation, any reporting made to any governmental or taxation authority by or on behalf of any member of the Group or by any adviser to such member of the Group in relation to DAC6 or any law or regulation which implements DAC6 or under The International Tax Enforcement (Disclosable Arrangements) Regulations 2023 and any unique identification number issued by any governmental or taxation authority to which any such report has been made (if available).
 
19.8
"Know your customer" checks
 
If:
 
(a)
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
 
(b)
any change in the status of a Transaction Obligor (or of a Holding Company of a Transaction Obligor)(including, without limitation, a change of ownership of a Transaction Obligor or the Holding Company of a Transaction Obligor) after the date of this Agreement;
 
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(c)
a proposed assignment or transfer by the Lender of any of its rights and obligations under this Agreement to a party that is not the Lender prior to such assignment or transfer; or
 
(d)
any anti-money laundering or anti-terrorism financing laws and regulations applicable to the Lender,
 
obliges the Lender (or, in the case of paragraph (c) above, any prospective assignee or transferee) to comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already available to it, each Obligor shall promptly upon the request of the Lender supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Lender (for itself or, in the case of the event described in paragraph (c) above, on behalf of any prospective assignee or transferee) in order for the Lender or, in the case of the event described in paragraph (c) above, any prospective assignee or transferee to carry out and be satisfied it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.
 
20
GENERAL UNDERTAKINGS
 
20.1
General
 
The undertakings in this Clause 20 (General Undertakings) remain in force throughout the Security Period except as the Lender may otherwise permit.
 
20.2
Authorisations
 
Each Obligor shall, and shall procure that each other Transaction Obligor will, promptly:
 
(a)
obtain, comply with and do all that is necessary to maintain in full force and effect; and
 
(b)
supply certified copies to the Lender of any Authorisation required under any law or regulation of a Relevant Jurisdiction or the state of the Approved Flag at any time of the Ship to enable it to:
 

 (i)
perform its obligations under the Transaction Documents to which it is a party;
 

 (ii)
ensure the legality, validity, enforceability or admissibility in evidence in any Relevant Jurisdiction and in the state of the Approved Flag at any time of the Ship of any Transaction Document to which it is a party; and
 

 (iii)
in the case of the Borrower, own and operate the Ship.
 
20.3
Compliance with laws
 
Each Obligor shall, and shall procure that (a) each other Transaction Obligor and (b) in the case of any Third Party Manager on a best effort basis, comply in all respects with all laws and regulations to which it may be subject, if failure so to comply has or is reasonably likely to have a Material Adverse Effect, including all Sanctions Laws and all Business Ethics Laws.
 
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20.4
Compliance with Sanctions Laws
 
Each Obligor shall, and shall procure that (i) each other Transaction Obligor and (ii) in the case of any Third Party Manager on a best effort basis:
 
(a)
ensure that neither it nor any Subsidiary of it is or will become a Restricted Party;
 
(b)
procure that no director, officer or employee of it or any Subsidiary of it is or will become a Restricted Party; and
 
(c)
procure that no proceeds of the Loan shall be made available, directly or indirectly, to or for the benefit of a Restricted Party nor shall they otherwise be applied in a manner for a purpose prohibited by Sanctions Laws.
 
20.5
Environmental compliance
 
Each Obligor shall, and shall procure that (i) each other Transaction Obligor and (ii) in relation to any Third Party Manager on a best effort basis will:
 
(a)
comply with all Environmental Laws;
 
(b)
obtain, maintain and ensure compliance with all requisite Environmental Approvals;
 
(c)
implement procedures to monitor compliance with and to prevent liability under any Environmental Law,
 
where failure to do so has or is reasonably likely to have a Material Adverse Effect.
 
20.6
Environmental Claims
 
Each Obligor shall, and shall procure that each other Transaction Obligor will (through the Guarantor), promptly upon becoming aware of the same, inform the Lender in writing of:
 
(a)
any Environmental Claim against any Transaction Obligor and member of the Group which is current, pending or threatened; and
 
(b)
any facts or circumstances which are reasonably likely to result in any Environmental Claim being commenced or threatened against any Transaction Obligor and any member of the Group,
 
where the claim, if determined against that Transaction Obligor or that member of the Group, has or is reasonably likely to have a Material Adverse Effect.
 
20.7
Taxation
 
(a)
Each Obligor shall, and shall procure that each other Transaction Obligor will, pay and discharge all Taxes imposed upon it or its assets within the time period allowed without incurring penalties unless and only to the extent that:
 

 (i)
such payment is being contested in good faith;
 

 (ii)
adequate reserves are maintained for those Taxes and the costs required to contest them and both have been disclosed in its latest financial statements delivered to the Lender under Clause 19.2 (Financial statements); and
 
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(iii)
such payment can be lawfully withheld.
 
(b)
No Obligor shall (and the Obligors shall procure that no other Transaction Obligor will), change its residence for Tax purposes.
 
20.8
Overseas companies
 
Each Obligor shall, and shall procure that each other Transaction Obligor will, promptly inform the Lender if it delivers to the Registrar particulars required under the Overseas Regulations of any UK Establishment and it shall comply with any directions given to it by the Lender regarding the recording of any Transaction Security on the register which it is required to maintain under The Overseas Companies (Execution of Documents and Registration of Charges) Regulations 2009.
 
20.9
Pari passu ranking
 
Each Obligor shall, and shall procure that each other Transaction Obligor will, ensure that at all times any unsecured and unsubordinated claims of the Lender against it under the Finance Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors except those creditors whose claims are mandatorily preferred by laws of general application to companies.
 
20.10
Title
 
(a)
With effect on and from the Release Date, the Borrower shall hold the legal title to, and own the entire beneficial interest in the Ship, the Earnings and the Insurances.
 
(b)
With effect on and from its creation or intended creation, each Transaction Obligor shall hold the legal title to, and own the entire beneficial interest in any assets which are the subject of any Transaction Security created or intended to be created by that Transaction Obligor.
 
20.11
Negative pledge
 
(a)
The Borrower shall not, and the Obligors shall procure that no other Transaction Obligor or Third Party Manager will, create or permit to subsist any Security over any of its assets which are, in the case of the Transaction Obligors other than the Borrower or Third Party Manager, the subject of the Security created or intended to be created by the Finance Documents.
 
(b)
The Borrower shall not:
 

 (i)
sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or re-acquired by a Transaction Obligor or Third Party Manager;
 

 (ii)
sell, transfer or otherwise dispose of any of its receivables on recourse terms;
 

 (iii)
enter into any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts; or
 

 (iv)
enter into any other preferential arrangement having a similar effect,
 
in circumstances where the arrangement or transaction is entered into primarily as a method of raising Financial Indebtedness or of financing the acquisition of an asset.
 
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(c)
Paragraphs (a) and (b) above do not apply to any Permitted Security.
 
20.12
Disposals
 
(a)
The Borrower shall not enter into a single transaction or a series of transactions (whether related or not) and whether voluntary or involuntary to sell, lease, transfer or otherwise dispose of any asset (including without limitation the Ship, the Earnings or the Insurances).
 
(b)
Paragraph (a) above does not apply to any Charters to which Clause 22.15 (Restrictions on chartering, appointment of managers etc.) applies.
 
20.13
Merger
 
No Obligor shall enter into any amalgamation, demerger, merger, consolidation or corporate reconstruction Provided that in the case of the Guarantor such amalgamation, demerger, merger, consolidation or corporate reconstruction is permitted without restrictions so long as (a) the Guarantor remains the surviving entity of any such process, (b) no Default has occurred at the relevant time or would be triggered as a result of such process and (c) the process of any such further amalgamation, demerger, merger, consolidation or corporate reconstruction is not reasonably likely to have a Material Adverse Effect.
 
20.14
Change of business
 
(a)
No Obligor shall, and the Obligors shall procure that no other Transaction Obligor will, make any substantial change is made to the general nature of its business from that carried on at the date of this Agreement.
 
(b)
No Obligor shall, and the Obligors shall procure that no other Transaction Obligor will, engage in any business other than the ownership, operation, chartering and management of the Ship.
 
20.15
Financial Indebtedness
 
The Borrower shall not incur or permit to be outstanding any Financial Indebtedness except for Permitted Financial Indebtedness.
 
20.16
Expenditure
 
The Borrower shall not incur any expenditure, except for expenditure reasonably incurred in the ordinary course of owning, operating, maintaining and repairing the Ship.
 
20.17
Share capital
 
The Borrower shall not:
 
(a)
purchase, cancel, redeem or retire any of its issued shares;
 
(b)
increase or reduce the number of shares that it is authorised to issue or change the par value of such shares or create any new class of shares;
 
(c)
issue any further shares except to the Guarantor and provided such new shares are made subject to the terms of the Shares Security immediately upon the issue of such new shares in a manner satisfactory to the Lender and the terms of the Shares Security are complied with; or
 
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(d)
appoint any further director or officer of the Borrower (unless the provisions of the Shares Security are complied with).
 
20.18
Dividends
 
The Borrower shall not:
 
(a)
declare, make or pay any dividend, charge, fee or other distribution (or interest on any unpaid dividend, charge, fee or other distribution) (whether in cash or in kind) on or in respect of its shares;
 
(b)
repay or distribute any dividend or share premium reserve;
 
(c)
pay any management, advisory or other fee to or to the order of any of its shareholders; or
 
(d)
redeem, repurchase, defease, retire or repay any of its shares or resolve to do so;
 
(e)
repay part of any Subordinated Liabilities,
 
at any time during the Security Period if a Default has occurred and is continuing or where the making or payment of such dividend or distribution, or as the case may be, any such other action or occurrence set out in paragraph (a) through (e) above would result in the occurrence of an Event of Default.
 
20.19
Accounts
 
The Borrower shall not, without the Lender’s prior consent (such consent shall not be unreasonably withheld), open or maintain any account with any bank or financial institution except for the Earnings Account, or accounts with the Lender for the purposes of the Finance Documents.
 
20.20
Other transactions
 
The Borrower shall not:
 
(a)
be the creditor in respect of any loan or any form of credit to any person other than another Transaction Obligor or any member of the Group and where such loan or form of credit is Permitted Financial Indebtedness;
 
(b)
give or allow to be outstanding any guarantee or indemnity to or for the benefit of any person in respect of any obligation of any other person or enter into any document under which the Borrower assumes any liability of any other person other than any guarantee or indemnity given under the Finance Documents or any guarantee or indemnity issued in the ordinary course of its business of operating, trading and chartering the Ship owned by it;
 
(c)
enter into any material agreement other than:
 

 (i)
the Transaction Documents;
 

 (ii)
any other agreement expressly allowed under any other term of this Agreement;
 
(d)
enter into any transaction on terms which are, in any respect, less favourable to the Borrower than those which it could obtain in a bargain made at arms' length; or
 
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(e)
acquire any shares or other securities other than US or UK Treasury bills and certificates of deposit issued by major North American or European banks.
 
20.21
Unlawfulness, invalidity and ranking; Security imperilled
 
No Obligor shall, and the Obligors shall procure that no other Transaction Obligor will, do (or fail to do) or cause or permit another person to do (or omit to do) anything which is likely to:
 
(a)
make it unlawful or contrary to Sanctions Laws for a Transaction Obligor to perform any of its obligations under the Transaction Documents;
 
(b)
cause any obligation of a Transaction Obligor under the Transaction Documents to cease to be legal, valid, binding or enforceable;
 
(c)
cause any Transaction Document to cease to be in full force and effect;
 
(d)
cause any Transaction Security to rank after, or lose its priority to, any other Security; and
 
(e)
imperil or jeopardise the Transaction Security.
 
20.22
Further assurance
 
(a)
Each Obligor shall, and shall procure each other Transaction Obligor will, promptly, and in any event within the time period specified by the Lender do all such acts (including procuring or arranging any registration, notarisation or authentication or the giving of any notice) or execute or procure execution of all such documents (including assignments, transfers, mortgages, charges, notices, instructions, acknowledgments, proxies and powers of attorney), as the Lender may specify (and in such form as the Lender may require in favour of the Lender or its nominee(s)):
 

 (i)
to create, perfect, vest in favour of the Lender or protect the priority of the Security or any right of any kind created or intended to be created under or evidenced by the Finance Documents (which may include the execution of a mortgage, charge, assignment or other Security over all or any of the assets which are, or are intended to be, the subject of the Transaction Security) or for the exercise of any rights, powers and remedies of the Lender or any Receiver or Delegate provided by or pursuant to the Finance Documents or by law;
 

 (ii)
to confer on the Lender Security over any property and assets of that Transaction Obligor located in any jurisdiction equivalent or similar to the Security intended to be conferred by or pursuant to the Finance Documents;
 

 (iii)
to facilitate or expedite the realisation and/or sale of, the transfer of title to or the grant of, any interest in or right relating to the assets which are, or are intended to be, the subject of the Transaction Security or to exercise any power specified in any Finance Document in respect of which the Security has become enforceable; and/or
 

 (iv)
to enable or assist the Lender to enter into any transaction to commence, defend or conduct any proceedings and/or to take any other action relating to any item of the Security Property.
 
(b)
Each Obligor shall, and shall procure that each other Transaction Obligor will, take all such action as is available to it (including making all filings and registrations) as may be necessary for the purpose of the creation, perfection, protection or maintenance of any Security conferred or intended to be conferred on the Lender by or pursuant to the Finance Documents.
 
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(c)
At the same time as a Transaction Obligor delivers to the Lender any document executed by itself or another Transaction Obligor pursuant to this Clause 20.22 (Further assurance), that Transaction Obligor shall deliver, or shall procure that such other Transaction Obligor will deliver, to the Lender evidence acceptable to the Lender that the Transaction Obligor's execution of such document has been duly authorised by it.
 
20.23
Transactions with Affiliates and Intercompany Borrowings
 
(a)
Upon occurrence of an Event of Default which is continuing, the Borrower undertakes that any intercompany loan to be made by the Guarantor to the Borrower will be fully subordinated to the rights of the Lender's in respect of the Loan pursuant to a Subordination Agreement to be made between the Borrower, the Guarantor and the Lender on terms acceptable to the Lender.
 
(b)
The Borrower undertakes that any intercompany loan to be made by the Guarantor to the Borrower will:
 

 (i)
not bear any cash interest;
 

 (ii)
have a maturity date of at least one year after the Termination Date; and
 

 (iii)
shall not be secured against the Ship or other Security which secures the Borrower’s obligations hereunder.
 
(c)
Any other equity contribution or intercompany loan from another member of the Group to the Borrower shall also be fully subordinated to the Lender’s rights during the Security Period.
 
(d)
The Obligors shall not enter into any transactions other than debt transactions referred to in paragraphs (a), (b) and (c) above with Affiliates except in the normal course of business.
 
20.24
No change to centre of main interests
 
No Obligor shall, and the Obligors shall procure that no other Transaction Obligor will, change the location of its centre of main interest (as that term is used in Article 3(1) of the Regulation) from that stated in relation to it in Clause 18.31 (Centre of main interests and establishments) and it will create no "establishment" (as that term is used in Article 2(10) of the Regulation) in any other jurisdiction.
 
20.25
Payment of Earnings and Earnings Account
 
(a)
The Borrower shall ensure that all Earnings are paid into the Earnings Account.
 
(b)
Upon request by the Lender, the Borrower shall provide a copy of each monthly bank account statement of the Earnings Account evidencing payment of Earnings into Earnings Account.
 
20.26
Ownership and control
 
The Guarantor shall:
 
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(a)
remain the direct owner of the shares of the Borrower and of the voting rights attaching to such shares; and
 
(b)
be the direct owner of shipping companies and of entities engaged in shipping related activities, all acceptable to the Lender.
 
20.27
Funding of acquisition of Ship
 
In the event that the acquisition cost of the Ship was funded by means of lending to the Borrower from any person or entity acceptable to the Lender, the Borrower shall ensure that the rights of such person or entity which funded the acquisition cost of the Ship shall be fully subordinated to all Financial Indebtedness incurred under the Finance Documents pursuant to a Subordination Deed and the Subordinated Liabilities under that Subordinated Agreement are assigned in favour of the Lender pursuant to a Subordinated Debt Security.
 
20.28
Use of proceeds
 
The Borrower shall ensure that no part of the proceeds of the Loan shall be used for the purposes of acquiring shares in the shares of the Lender or other banks and/or financial institutions or acquiring hybrid capital debentures of the Lender or other banks and/or financial institutions.
 
20.29
NASDAQ listing
 
The Guarantor shall maintain its listing on the NASDAQ Stock Exchange or any other stock exchange acceptable to the Lender.
 
20.30
Security Deposit Amount
 
The Borrower shall ensure that on and from the Utilisation Date and throughout the Security Period, there is standing to the credit of the Security Deposit Account a credit balance in an amount of not less than the Security Deposit Amount to be held by the Lender on behalf of the Borrower as security for the Secured Liabilities under this Agreement.
 
20.31
Application of Security Deposit Amount in the case of mandatory prepayment and Event of Default
 
(a)
The Borrower agrees that an amount equal to the Security Deposit Amount may be deducted from the amount of the Utilisation if not otherwise paid to the Lender by or on behalf of the Borrower by remitting such amount into the Security Deposit Account on or before the Utilisation Date.
 
(b)
After the occurrence of an Event of Default which is continuing, the Lender may at its discretion apply the Security Deposit Amount towards any Unpaid Sum.  After any such application then (unless the Loan has been accelerated in accordance with Clause 24.21 (Acceleration)), the Borrower shall within ten (10) Business Days pay to the Lender such amount as may be required to replenish any shortfall in the required Security Deposit Amount.
 
(c)
In the event of any mandatory prepayment of the Loan under Clause 7.1 (Illegality and Sanctions Laws affecting the Lender), or Clause 7.3 (Mandatory prepayment on sale or Total Loss) or in the event that the Loan is required to be repaid in accordance with Clause 24.21 (Acceleration), then the Lender may at its discretion apply the Security Deposit Amount (or any remaining balance thereof at that time) against the relevant amounts to be prepaid or repaid by the Borrower.
 
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(d)
If the Loan is repaid in full on the Termination Date or prepaid in full in accordance with Clause 7.2 (Voluntary prepayment of Loan), then provided the Lender is satisfied that the Secured Liabilities have been fully discharged as a result of such repayment or prepayment, the Lender shall return the Security Deposit Amount (or any remaining balance thereof at that time) to the Borrower without any interest or the Borrower may, with the Lender's prior consent, set off the amount of the Balloon Amount due against the Security Deposit Amount standing to the credit of the Security Deposit Account at the time of repayment of the Balloon Amount.
 
(e)
The Security Deposit Account shall be non-interest bearing and the Lender shall be under no obligation to keep the Security Deposit Amount in a separate account.
 
20.32
Security Deposit Amount in the case of insolvency of the Lender
 
In the event that any corporate action, legal proceedings or other similar legal procedure or similar legal step is taken in relation to:
 
(a)
the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of the Lender and/or the Security Deposit Account Bank; or
 
(b)
the appointment of a liquidator, receiver, administrator, administrative receiver, compulsory manager or other similar officer in respect of the Lender and/or the Security Deposit Account Bank or any of its assets; or
 
(c)
enforcement of any Security over any assets of the Lender and/or the Security Deposit Account Bank, or any analogous procedure or step is taken in any jurisdiction against the Lender and/or the Security Deposit Account Bank and the Security Deposit Amount is blocked in the Security Deposit Account and cannot be released and/or transferred to the Borrower's nominated account in accordance with the provisions of this Agreement,
 
the Security Deposit Amount standing to the credit of the Security Deposit Account shall be automatically set off against the Loan and the Loan shall be reduced accordingly. The Lender shall notify the Obligors in writing when it has actual notice of the occurrence of any of the events under paragraphs (a) to (c) above.
 
20.33
No variation, release etc. of MOA
 
The Borrower shall not, whether by a document, by conduct, by acquiescence or in any other way:
 
(a)
vary the MOA (except for the entering with the Seller into any addendum in relation to the necessary delivery documentation or any other delivery operational aspect of the Ship, if so required); or
 
(b)
release, waive, suspend, subordinate or permit to be lost or impaired any interest or right of any kind which the Borrower has at any time to, in or in connection with, the MOA or in relation to any matter arising out of or in connection with the MOA.
 
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20.34
Provision of information relating to MOA
 
Without prejudice to Clause 19.4 (Information: miscellaneous), the Borrower shall:
 
(a)
immediately inform the Lender if any breach of the MOA occurs or a serious risk of such a breach arises and of any other event or matter affecting the MOA which has or is reasonably likely to have a Material Adverse Effect; and
 
(b)
upon the reasonable request of the Lender, keep the Lender informed as to any notice of readiness of delivery of the Ship.
 
20.35
No assignment etc. of MOA
 
The Borrower shall not assign, novate, transfer or dispose of any of its rights or obligations under the MOA.
 
21
INSURANCE UNDERTAKINGS
 
21.1
General
 
The undertakings in this Clause 21 (Insurance Undertakings) shall apply and remain in force on and from the Release Date and throughout the rest of the Security Period except as the Lender may otherwise permit.
 
21.2
Maintenance of obligatory insurances
 
The Borrower shall keep the Ship insured at its expense against:
 
(a)
fire and usual marine risks (including hull and machinery and excess risks);
 
(b)
war risks (including blocking and trapping);
 
(c)
protection and indemnity risks; and
 
(d)
any other risks against which the Lender considers, having regard to ship insurance or ship finance practices and other circumstances prevailing at the relevant time, it would be reasonable for the Borrower to insure and which are specified by the Lender by notice to the Borrower.
 
21.3
Terms of obligatory insurances
 
The Borrower shall effect such insurances:
 
(a)
in dollars;
 
(b)
in the case of fire and usual marine risks (including hull and machinery and excess risks) and war risks, in an amount on an agreed value basis at least the greater of:
 

 (i)
one hundred and twenty per cent. (120%) of the Loan; and
 

 (ii)
the Fair Market Value of the Ship;
 
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(c)
in the case of oil pollution liability risks, for an aggregate amount equal to the highest level of cover from time to time available under basic protection and indemnity club entry and in the international marine insurance market (currently $1,000,000,000);
 
(d)
in the case of protection and indemnity risks, in respect of the full tonnage of the Ship;
 
(e)
on approved terms; and
 
(f)
through Approved Brokers and with approved insurance companies and/or underwriters or, in the case of war risks and protection and indemnity risks, in approved war risks and protection and indemnity risks associations (which are members of the International Group of Protection and Indemnity Associations).
 
21.4
Further protections for the Lender
 
In addition to the terms set out in Clause 21.3 (Terms of obligatory insurances), the Borrower shall procure that the obligatory insurances shall:
 
(a)
subject always to paragraph (b), name the Borrower as the sole named assured unless the interest of every other named assured is limited:
 

 (i)
in respect of any obligatory insurances for hull and machinery and war risks;
 

 (A)
to any provable out-of-pocket expenses that it has incurred and which form part of any recoverable claim on underwriters; and
 

 (B)
to any third party liability claims where cover for such claims is provided by the policy (and then only in respect of discharge of any claims made against it); and
 

 (ii)
in respect of any obligatory insurances for protection and indemnity risks, to any recoveries it is entitled to make by way of reimbursement following discharge of any third party liability claims made specifically against it;
 
and every other named assured has undertaken in writing to the Lender (in such form as it requires) that any deductible shall be apportioned between the Borrower and every other named assured in proportion to the gross claims made or paid by each of them and that it shall do all things necessary and provide all documents, evidence and information to enable the Lender to collect or recover any moneys which at any time become payable in respect of the obligatory insurances;
 
(b)
whenever the Lender requires, name (or be amended to name) the Lender as additional named assured for its rights and interests, warranted no operational interest and with full waiver of rights of subrogation against the Lender, but without the Lender being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;
 
(c)
name the Lender as loss payee with such directions for payment as the Lender may specify;
 
(d)
provide that all payments by or on behalf of the insurers under the obligatory insurances to the Lender shall be made without set off, counterclaim or deductions or condition whatsoever;
 
(e)
provide that the obligatory insurances shall be primary without right of contribution from other insurances which may be carried by the Lender; and
 
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(f)
provide that the Lender may make proof of loss if the Borrower fails to do so.
 
21.5
Renewal of obligatory insurances
 
The Borrower shall:
 
(a)
at least 14 days before the expiry of any obligatory insurance:
 

 (i)
notify the Lender of the Approved Brokers (or other insurers) and any protection and indemnity or war risks association through or with which the Borrower proposes to renew that obligatory insurance and of the proposed terms of renewal; and
 

 (ii)
obtain the Lender’s approval to the matters referred to in sub-paragraph (i) of this paragraph (a) above;
 
(b)
at least 7 days before the expiry of any obligatory insurance, renew that obligatory insurance in accordance with the Lender’s approval pursuant to paragraph (a) above; and
 
(c)
procure that the Approved Brokers and/or the approved war risks and protection and indemnity associations with which such a renewal is effected shall promptly after the renewal notify the Lender in writing of the terms and conditions of the renewal.
 
21.6
Copies of policies; letters of undertaking
 
The Borrower shall ensure that the Approved Brokers provide the Lender with:
 
(a)
pro forma copies of all policies relating to the obligatory insurances which they are to effect or renew; and
 
(b)
a letter or letters of undertaking in a form required by the Lender and including undertakings by the Approved Brokers that:
 

 (i)
they will have endorsed on each policy, immediately upon issue, a loss payable clause and a notice of assignment complying with the provisions of Clause 21.4 (Further protections for the Lender);
 

 (ii)
they will hold such policies, and the benefit of such insurances, to the order of the Lender in accordance with such loss payable clause;
 

 (iii)
they will advise the Lender immediately of any material change to the terms of the obligatory insurances;
 

 (iv)
they will, if they have not received notice of renewal instructions from the Borrower or its agents, notify the Lender not less than 14 days before the expiry of the obligatory insurances;
 

 (v)
if they receive instructions to renew the obligatory insurances, they will promptly notify the Lender of the terms of the instructions;
 

 (vi)
they will not set off against any sum recoverable in respect of a claim relating to the Ship under such obligatory insurances any premiums or other amounts due to them or any other person whether in respect of the Ship or otherwise, they waive any lien on the policies, or any sums received under them, which they might have in respect of such premiums or other amounts and they will not cancel such obligatory insurances by reason of non-payment of such premiums or other amounts; and
 
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(vii)
they will arrange for a separate policy to be issued in respect of the Ship forthwith upon being so requested by the Lender.
 
21.7
Copies of certificates of entry
 
The Borrower shall ensure that any protection and indemnity and/or war risks associations in which the Ship is entered provide the Lender with:
 
(a)
a copy of the certificate of entry for the Ship;
 
(b)
a letter or letters of undertaking in such form as may be required by the Lender; and
 
(c)
a copy of each certificate of financial responsibility for pollution by oil or other Environmentally Sensitive Material issued by the relevant certifying authority in relation to the Ship.
 
21.8
Deposit of original policies
 
The Borrower shall ensure that all policies relating to obligatory insurances are deposited with the Approved Brokers through which the insurances are effected or renewed.
 
21.9
Payment of premiums
 
The Borrower shall punctually pay all premiums or other sums payable in respect of the obligatory insurances and produce all relevant receipts when so required by the Lender.
 
21.10
Guarantees
 
The Borrower shall ensure that any guarantees required by a protection and indemnity or war risks association are promptly issued and remain in full force and effect.
 
21.11
Compliance with terms of insurances
 
(a)
The Borrower shall not do nor omit to do (nor permit to be done or not to be done) any act or thing which would or might render any obligatory insurance invalid, void, voidable or unenforceable or render any sum payable under an obligatory insurance repayable in whole or in part.
 
(b)
Without limiting paragraph (a) above, the Borrower shall:
 

 (i)
take all necessary action and comply with all requirements which may from time to time be applicable to the obligatory insurances, and (without limiting the obligation contained in sub-paragraph (iii) of paragraph (b) of Clause 21.6 (Copies of policies; letters of undertaking)) ensure that the obligatory insurances are not made subject to any exclusions or qualifications to which the Lender has not given its prior approval;
 

 (ii)
not make any changes relating to the classification or classification society or manager or operator of the Ship unless they are approved by the underwriters of the obligatory insurances (if such approval is required); and
 

 (iii)
not employ the Ship, nor allow it to be employed, otherwise than in conformity with the terms and conditions of the obligatory insurances, without first obtaining the consent of the insurers and complying with any requirements (as to extra premium or otherwise) which the insurers specify.
 
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21.12
Alteration to terms of insurances
 
The Borrower shall not make or agree to any alteration to the terms of any obligatory insurance or waive any right relating to any obligatory insurance unless it has obtained the written consent of the Lender (such consent not to be unreasonably withheld or delayed).
 
21.13
Settlement of claims
 
The Borrower shall:
 
(a)
not settle, compromise or abandon any claim under any obligatory insurance for Total Loss or for a Major Casualty; and
 
(b)
do all things necessary and provide all documents, evidence and information to enable the Lender to collect or recover any moneys which at any time become payable in respect of the obligatory insurances.
 
21.14
Provision of copies of communications
 
The Borrower shall provide the Lender, at the time of each such material communication (other than communications of an entirely routine nature), with copies of all written communications between the Borrower and:
 
(a)
the Approved Brokers;
 
(b)
the approved protection and indemnity and/or war risks associations; and
 
(c)
the approved insurance companies and/or underwriters,
 
which relate directly or indirectly to:
 

 (i)
the Borrower's obligations relating to the obligatory insurances including, without limitation, all requisite declarations and payments of additional premiums or calls; and
 

 (ii)
any credit arrangements made between the Borrower and any of the persons referred to in paragraphs (a) or (b) above relating wholly or partly to the effecting or maintenance of the obligatory insurances.
 
21.15
Provision of information
 
The Borrower shall promptly provide the Lender (or any persons which it may designate) with any information which the Lender (or any such designated person) requests for the purpose of:
 
(a)
obtaining or preparing any report from an independent marine insurance broker as to the adequacy of the obligatory insurances effected or proposed to be effected; and/or
 
(b)
effecting, maintaining or renewing any such insurances as are referred to in Clause 21.16 (Mortgagee's interest and additional perils insurances) or dealing with or considering any matters relating to any such insurances,
 
and the Borrower shall, forthwith upon demand, indemnify the Lender in respect of all fees and other expenses incurred by or for the account of the Lender in connection with any such report as is referred to in paragraph (a) above.
 
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21.16
Mortgagee's interest and additional perils insurances
 
(a)
The Lender shall be entitled from time to time to effect, maintain and renew a mortgagee's interest marine insurance and a mortgagee's interest additional perils insurance each in an amount of not less than 120 per cent. of the Loan and otherwise on such terms, through such insurers and generally in such manner as the Lender may from time to time consider appropriate.
 
(b)
The Borrower shall upon demand fully indemnify the Lender in respect of all premiums and other expenses which are incurred in connection with or with a view to effecting, maintaining or renewing any insurance referred to in paragraph (a) above or dealing with, or considering, any matter arising out of any such insurance.
 
22
SHIP UNDERTAKINGS
 
22.1
General
 
The undertakings in this Clause 22 (Ship Undertakings) shall apply and remain in force on and from the Release Date and throughout the rest of the Security Period except as the Lender may otherwise permit.
 
22.2
Ship's name and registration
 
The Borrower shall:
 
(a)
keep the Ship registered in its name under an Approved Flag from time to time at its port of registration;
 
(b)
not do or allow to be done anything as a result of which such registration might be suspended, cancelled or imperilled;
 
(c)
not enter into any dual flagging arrangement in respect of the Ship; and
 
(d)
not change the name of the Ship,
 
provided that any change of name or flag of the Ship approved by the Lender shall be subject to:
 

 (i)
the Ship remaining subject to Security securing the Secured Liabilities created by a first priority or preferred ship mortgage on the Ship and, if appropriate, a first priority deed of covenant collateral to that mortgage (or equivalent first priority Security) on substantially the same terms as the Mortgage and on such other terms and in such other form as the Lender shall approve or require; and
 

 (ii)
the execution of such other documentation amending and supplementing the Finance Documents as the Lender shall approve or require.
 
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22.3
Repair and classification
 
The Borrower shall keep the Ship in a good and safe condition and state of repair:
 
(a)
consistent with first class ship ownership and management practice; and
 
(b)
so as to maintain the Approved Classification with an Approved Classification Society free of overdue recommendations and conditions.
 
22.4
Classification society undertaking
 
If required by the Lender in writing, the Borrower shall instruct the Approved Classification Society (and procure that the Approved Classification Society undertakes with the Lender):
 
(a)
to send to the Lender, following receipt of a written request from the Lender, certified true copies of all original class records held by the Approved Classification Society in relation to the Ship;
 
(b)
to allow the Lender (or its agents), at any time and from time to time, to inspect the original class and related records of the Borrower and the Ship at the offices of the Approved Classification Society and to take copies of them;
 
(c)
to notify the Lender immediately in writing if the Approved Classification Society:
 

 (i)
receives notification from the Borrower or any person that the Ship’s Approved Classification Society is to be changed; or
 

 (ii)
becomes aware of any facts or matters which may result in or have resulted in a change, suspension, discontinuance, withdrawal or expiry of the Ship's class under the rules or terms and conditions of the Borrower or the Ship's membership of the Approved Classification Society;
 
(d)
following receipt of a written request from the Lender:
 

 (i)
to confirm that the Borrower is not in default of any of its contractual obligations or liabilities to the Approved Classification Society, including confirmation that it has paid in full all fees or other charges due and payable to the Approved Classification Society; or
 

 (ii)
to confirm that the Borrower is in default of any of its contractual obligations or liabilities to the Approved Classification Society, to specify to the Lender in reasonable detail the facts and circumstances of such default, the consequences of such default, and any remedy period agreed or allowed by the Approved Classification Society.
 
22.5
Modifications
 
Unless with the prior written consent from the Lender (such consent not to be unreasonably withheld or delayed), the Borrower shall not make any modification or repairs to, or replacement of, the Ship or equipment installed on it which would or might materially alter the structure, type or performance characteristics of the Ship or materially reduce its market value.  For the avoidance of doubt, scrubber retrofitting and any improvements required for compliance with regulations shall not be considered as material modification for the purpose of this Clause 22.5 (Modifications).
 
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22.6
Removal and installation of parts
 
(a)
Subject to paragraph (b) below, the Borrower shall not remove any material part of the Ship, or any item of equipment installed on the Ship unless:
 

 (i)
the part or item so removed is forthwith replaced by a suitable part or item which is in the same condition as or better condition than the part or item removed;
 

 (ii)
the replacement part or item is free from any Security in favour of any person other than the Lender; and
 

 (iii)
the replacement part or item becomes, on installation on the Ship, the property of the Borrower and subject to the security constituted by the Mortgage.
 
(b)
The Borrower may install equipment owned by a third party if the equipment can be removed without any risk of damage to the Ship.
 
22.7
Surveys
 
The Borrower shall submit the Ship regularly to all periodic or other surveys which may be required for classification purposes and, if so required by the Lender, provide the Lender, with copies of all survey reports.
 
22.8
Inspection
 
The Borrower shall permit the Lender (acting through surveyors or other persons appointed by and reporting to the Lender for that purpose) to board the Ship to inspect its condition or to satisfy themselves about proposed or executed repairs and the Borrower shall afford all proper facilities for such inspections.  Prior to the occurrence of an Event of Default which is continuing, such inspections shall be at reasonable times and upon reasonable notice and without interfering with the Ship's normal course of trading, and no more than one such inspection in each calendar year shall be at the Borrower’s expense.  If an Event of Default has occurred which is continuing the Lender may inspect the Ship as often as it deems necessary or desirable, without restriction, all at the Borrower’s expense.
 
22.9
Prevention of and release from arrest
 
(a)
The Borrower shall promptly discharge:
 

 (i)
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against the Ship, the Earnings or the Insurances;
 

 (ii)
all Taxes, dues and other amounts charged in respect of the Ship, the Earnings or the Insurances; and
 

 (iii)
all other outgoings whatsoever in respect of the Ship, the Earnings or the Insurances.
 
(b)
The Borrower shall, immediately upon receiving notice of the arrest of the Ship or of its detention in exercise or purported exercise of any lien or claim, take all steps necessary to procure its release by providing bail or otherwise as the circumstances may require.
 
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22.10
Compliance with laws etc.
 
Each Obligor shall (and shall procure that each other Transaction Obligor shall):
 
(a)
comply, or procure compliance with all laws or regulations:
 

 (i)
relating to its business generally; and
 

 (ii)
relating to the Ship, its ownership, employment, operation, management and registration,
 
including, but not limited to:
 

 (A)
the ISM Code;
 

 (B)
the ISPS Code;
 

 (C)
all Environmental Laws;
 

 (D)
all Sanctions Laws; and
 

 (E)
the laws of the Approved Flag; and
 
(b)
obtain, comply with and do all that is necessary to maintain in full force and effect any Environmental Approvals;
 
(c)
without limiting paragraph (a) above, not employ the Ship nor allow its employment, operation or management in any manner contrary to any law or regulation including but not limited to the ISM Code, the ISPS Code, all Environmental Laws and all Sanctions Laws; and
 
(d)
procure that neither any Obligor nor any other member of the Group is or becomes a Restricted Party.
 
22.11
ISPS Code
 
Without limiting paragraph (a) of Clause 22.10 (Compliance with laws etc.), the Borrower shall (and shall procure that each Approved Manager will):
 
(a)
procure that the Ship and the company responsible for the Ship's compliance with the ISPS Code comply with the ISPS Code; and
 
(b)
maintain an ISSC for the Ship; and
 
(c)
notify the Lender immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
 
22.12
Trading in war zones or excluded areas
 
The Borrower shall not cause or permit the Ship to enter or trade to any zone which is declared a war zone by any government or by the Ship's war risks insurers or which is otherwise excluded from the scope of coverage of the obligatory insurances unless:
 
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(a)
the prior written consent of the Lender has been given; and
 
(b)
the Borrower has (at its expense) effected any special, additional or modified insurance cover which the insurers and the Lender may require.
 
22.13
Provision of information
 
Without prejudice to Clause 19.4 (Information: miscellaneous) the Borrower shall, promptly provide the Lender with any information which it requests regarding:
 
(a)
the Ship, its employment, position and engagements;
 
(b)
the Earnings and payments and amounts due to its master and crew;
 
(c)
any expenditure incurred, or likely to be incurred, in connection with the operation, maintenance or repair of the Ship and any payments made by it in respect of the Ship;
 
(d)
any towages and salvages; and
 
(e)
its compliance, each Approved Manager's compliance and the compliance of the Ship with the ISM Code and the ISPS Code and any Sanctions Laws,
 
and, upon the Lender’s request, promptly provide copies of any current Charter relating to the Ship, of any current guarantee of any such Charter, the Ship's Safety Management Certificate and any relevant Document of Compliance.
 
22.14
Notification of certain events
 
The Borrower shall immediately notify the Lender by email of:
 
(a)
any casualty to the Ship which is or is likely to be or to become a Major Casualty;
 
(b)
any occurrence as a result of which the Ship has become or is, by the passing of time or otherwise, likely to become a Total Loss;
 
(c)
any requisition of the Ship for hire;
 
(d)
any requirement or recommendation made in relation to the Ship by any insurer or classification society or by any competent authority which is not immediately complied with;
 
(e)
any arrest or detention of the Ship or any exercise or purported exercise of any lien on the Ship or the Earnings;
 
(f)
any intended dry docking of the Ship;
 
(g)
any Environmental Claim made against the Borrower or in connection with the Ship, or any Environmental Incident;
 
(h)
any claim for breach of the ISM Code or the ISPS Code being made against the Borrower, any Approved Manager or otherwise in connection with the Ship; or
 
(i)
any other matter, event or incident, actual or threatened, the effect of which will or could lead to the ISM Code or the ISPS Code not being complied with;
 
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(j)
any notice, or the Borrower becoming aware, of any claim, action, suit, proceeding or investigation against any Transaction Obligor, any of its Subsidiaries or any of their respective directors, officers or employees with respect to Sanctions Laws; or
 
(k)
any circumstances which could give rise to a breach of any representation or undertaking in this Agreement, or any Event of Default, relating to Sanctions,
 
and the Borrower shall keep the Lender advised in writing on a regular basis and in such detail as the Lender shall require as to the Borrower's, each Approved Manager's or any other person's response to any of those events or matters.
 
22.15
Restrictions on chartering, appointment of managers etc.
 
The Borrower, unless it has obtained the Lender’s written consent in advance (and subject to such additional conditions as the Lender may require), shall not:
 
(a)
let the Ship on demise charter for any period;
 
(b)
enter into any time, voyage or consecutive voyage charter in respect of the Ship other than a Permitted Charter;
 
(c)
materially amend, supplement, cancel or terminate any Management Agreement or an Assignable Charter (and for the avoidance of doubt, but without limitation, any amendment in relation to the parties, terms of hire, the time of the payment and/or the management fee is considered material provided that the Borrower may agree to increase the management fee once a year in line with market standard unless an Event of Default has occurred and is continuing);
 
(d)
appoint a manager of the Ship other than an Approved Manager or agree to any alteration to the terms of an Approved Manager's appointment;
 
(e)
de activate or lay up the Ship; or
 
(f)
put the Ship into the possession of any person for the purpose of work being done upon it in an amount exceeding or likely to exceed $1,000,000 (or the equivalent in any other currency) unless that person has first given to the Lender and in terms satisfactory to it a written undertaking not to exercise any lien on the Ship or its Earnings for the cost of such work or for any other reason.
 
22.16
Notice of Mortgage
 
The Borrower shall keep the Mortgage registered against the Ship as a valid first priority or, as the case may be, preferred mortgage, carry on board the Ship a certified copy of the Mortgage and place and maintain in a conspicuous place in the navigation room and the master's cabin of the Ship a framed printed notice stating that the Ship is mortgaged by the Borrower to the Lender.
 
22.17
Sharing of Earnings
 
The Borrower shall not enter into any agreement or arrangement for the sharing of any Earnings.
 
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22.18
Inventory of Hazardous Materials
 
The Borrower shall maintain an Inventory of Hazardous Materials in respect of the Ship.
 
22.19
Assignable Charter
 
(a)
If the Borrower enters into any Assignable Charter (subject to the Lender's approval) pursuant to Clause 22.15 (Restrictions on chartering, appointment of managers etc.), the Borrower shall, promptly after the date on which it enters into such Assignable Charter:
 

 (i)
provide the Lender with a certified true copy of such Assignable Charter;
 

 (ii)
notify the relevant charterer and any charter guarantor of the assignment of such Assignable Charter under the General Assignment, which the Borrower shall use reasonable commercial efforts to procure the relevant charterer and any charter guarantor to provide acknowledgment under the General Assignment; and
 

 (iii)
without limiting the generality of the above, if that Assignable Charter is a bareboat charter, procure that the bareboat charterer shall promptly execute in favour of the Lender an assignment of (inter alia) all its rights, title and interest in and to the Insurances in respect of the Ship effected either by the Borrower or by the bareboat charterer which shall,  be in an agreed form,
 
and shall deliver to the Lender such other documents as the Lender may reasonably require.
 
(b)
If the Borrower enters into any Assignable Charter pursuant to which the relevant charterer requires a quiet enjoyment letter from the Lender, the Lender shall use its reasonably commercial endeavours to provide such quiet enjoyment letter on such terms as agreed between the Lender, the Borrower and the relevant charterer, and for the avoidance of doubt, under the Lender's applicable internal policies the quiet enjoyment letter shall be subject to the relevant charterer's compliance with Sanctions Laws.
 
22.20
Sustainable and socially responsible dismantling of Ship
 
Each Obligor confirms that as long as it is in a lending relationship with the Lender, it will use its reasonable commercial efforts that the Ship controlled by it or sold to an intermediary with the intention of being scrapped, is recycled at a recycling yard which conducts its recycling business in a socially and environmentally responsible manner, in accordance with the provisions of The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, 2009 and/or EU Ship Recycling Regulation.
 
22.21
Sanctions Laws and Ship trading
 
(a)
Without limiting Clause 22.10 (Compliance with laws etc.), the Borrower:
 

 (i)
shall procure that the Ship shall not be used by or for the benefit of a Restricted Party;
 

 (ii)
shall procure that the Ship shall not be used directly or indirectly in trading in any manner contrary to Sanctions Laws (or which could be contrary to Sanctions Laws if Sanctions Laws were binding on each Transaction Obligor) or in any trade which could expose the Ship, a Transaction Obligor, the Lender, crew or insurers to enforcement proceedings or any other consequences whatsoever arising from Sanctions Laws;
 
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(iii)
shall procure that such Ship shall not be traded in any manner which would trigger the operation of any sanctions limitation or exclusion clause (or similar) in the Insurances; and
 

 (iv)
shall use its best commercial efforts that each charterparty in respect of the Ship shall contain, for the benefit of the Borrower, language which gives effect to the provisions of paragraph (c) of Clause 22.10 (Compliance with laws etc.) as regards Sanctions Laws and of this Clause 22.21 (Sanctions and Ship trading) and which permits refusal of employment or voyage orders if compliance would result in a breach of applicable sanctions (or which would result in a breach of Sanctions Laws if Sanctions Laws were binding on each Transaction Obligor).
 
(b)
The Obligor shall not, nor shall an Obligor permit or authorise any other person to, directly or indirectly, use, lend, make payments of, contribute or otherwise make available, all or any part of the proceeds of any Loan or other transaction(s) contemplated by this Agreement to fund any trade, business or other activities:
 

 (i)
involving or for the benefit of any Restricted Party; or
 

 (ii)
in any other manner that would reasonably be expected to result in any Obligor or any Lender being in breach of any Sanctions Laws (if and to the extent applicable to either of them) or becoming a Restricted Party.
 
22.22
Anti-terrorism
 
The Borrower shall, and shall ensure that each of the other Transaction Obligors will, comply with all anti-terrorism laws in each case applicable to it and shall take all actions necessary or which may be reasonably required by the Lender to allow the Lender to comply with any anti-terrorism laws applicable to it.
 
22.23
Notification of compliance
 
The Borrower shall promptly provide the Lender from time to time with evidence (in such form as the Lender requires) that it is complying with this Clause 22 (Ship Undertakings).
 
23
SECURITY COVER
 
23.1
Minimum required security cover
 
Clause 23.2 (Provision of additional security; prepayment) applies if, the Lender notifies the Borrower that the Security Cover Ratio is below:
 
(a)
for the period commencing from the Utilisation Date and up to and including the second anniversary of the Utilisation Date, one hundred and ten per cent. (110%) of the Loan; and
 
(b)
for the period commencing from the day after the second anniversary of the Utilisation Date and up to and including the fifth anniversary of the Utilisation Date, one hundred and twenty per cent. (120%) of the Loan,
 
in each case, with any such determination being binding and conclusive as regards the Borrower.
 
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23.2
Provision of additional security; prepayment
 
(a)
If the Lender serves a notice on the Borrower under Clause 23.1 (Minimum required security cover), the Borrower or the Guarantor shall, on or before the date falling 30 Business Days after the date on which the Lender’s notice is served (the "Rectification Date"), prepay such part of the Loan as shall eliminate the shortfall.
 
(b)
The Borrower or the Guarantor may, instead of making a prepayment as described in paragraph (a) above, provide, or ensure that a third party has provided, additional security (including cash deposits pledged in favour of the Lender) which, in the opinion of the Lender:
 

 (i)
has a net realisable value at least equal to the shortfall; and
 

 (ii)
is documented in such terms as the Lender may approve or require,
 
before the Rectification Date; and conditional upon such security being provided in such manner, it shall satisfy such prepayment obligation.
 
23.3
Value of additional vessel security
 
The net realisable value of any additional security which is provided under Clause 23.2 (Provision of additional security; prepayment) and which constitutes Security over a vessel shall be the Fair Market Value of the vessel concerned.
 
23.4
Valuations binding
 
Any valuation under this Clause 23 (Security Cover) shall be binding and conclusive as regards the Borrower.
 
23.5
Provision of information
 
(a)
The Borrower shall promptly provide the Lender and any Approved Valuer acting under this Clause 23 (Security Cover) with any information which the Lender or that Approved Valuer may request for the purposes of the valuation.
 
(b)
If the Borrower fails to provide the information referred to in paragraph (a) above by the date specified in the request, the valuation may be made on any basis and assumptions which the Approved Valuer or the Lender considers prudent.
 
23.6
Prepayment mechanism
 
Any prepayment pursuant to Clause 23.2 (Provision of additional security; prepayment) shall be made in accordance with the relevant provisions of Clause 7 (Prepayment and Cancellation) and shall be treated as a voluntary prepayment pursuant to Clause 7.2 (Voluntary prepayment of Loan); however, such prepayment shall be applied against the outstanding Repayment Instalments (including the Balloon Amount) in order of maturity commencing with the next Repayment Instalment due after the date of such prepayment but ignoring any restriction as to prepayments being made on the last day of the Interest Period.
 
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23.7
Provision of valuations
 
(a)
The Lender shall at such times as the Lender shall deem necessary and, in any event, at least twice during each calendar year on 30 June and 31 December, following the date of this Agreement, be provided with a valuation of the Ship and any other vessel over which additional Security has been created in accordance with Clause 23.2 (Provision of additional security; prepayment), from an Approved Valuer to enable the Lender to determine the Fair Market Value of the Ship and (if applicable) any such other vessel.
 
(b)
In addition to the valuations obtained at the intervals described in paragraph (a) above, additional valuations may be obtained:
 

 (i)
at any other time requested by the Borrower for the purposes of Clause 23.8 (Release of additional security); or
 

 (ii)
upon occurrence of an Event of Default which is continuing, at any other time requested by the Lender in its absolute discretion.
 
(c)
The valuations referred to in paragraph (a), (b)(i) and (b)(ii) of Clause 23.7 (Provision of valuations) shall be at the Borrower’s cost, but no more than twice per year, unless the valuations provided under paragraph (a), (b)(i) and (b)(ii) of Clause 23.7 (Provision of valuations) show a breach of Clause 23.1 (Minimum required security cover), in which case any additional valuations will be at the Borrower’s cost.
 
23.8
Release of additional security
 
The Lender shall, upon request by the Borrower, release (at the cost of the Borrower) any additional security provided pursuant to Clause 23.2 (Provision of additional security; prepayment) on the conditions that:
 
(a)
after the provision of such additional security (but without taking into account the value of such additional security), the Security Cover Ratio has been maintained for six consecutive Months for no less than the applicable percentage set out in paragraph (a) or (b) of Clause 23.1 (Minimum required security cover) in accordance with Clause 23.1 (Minimum required security cover) as evidenced by additional valuations provided in accordance with Clause 23.7 (Provision of valuations) and dated no earlier than the later of (i) 30 days prior to the date of release of such additional security and (ii) six months after provision of such additional security;
 
(b)
the Borrower will be in compliance with Clause 23.1 (Minimum required security cover) immediately following such release; and
 
(c)
no Default has occurred which is continuing.
 
24
EVENTS OF DEFAULT
 
24.1
General
 
Each of the events or circumstances set out in this Clause 24 (Events of Default) is an Event of Default except for Clause 24.21 (Acceleration) and Clause 24.22 (Enforcement of security and other rights).
 
24.2
Non-payment
 
A Transaction Obligor or Third Party Manager does not pay on the due date any amount payable pursuant to a Finance Document at the place at and in the currency in which it is expressed to be payable unless:
 
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(a)
its failure to pay is caused by:
 

 (i)
administrative or technical error; or
 

 (ii)
a Disruption Event; and
 
(b)
payment is made within three Business Days of its due date.
 
24.3
Specific obligations
 
A breach occurs of Clause 4.4 (Conditions subsequent), Clause 18.34 (Sanctions Laws), Clause 20.10 (Title), Clause 20.11 (Negative pledge), Clause 20.21 (Unlawfulness, invalidity and ranking; Security imperilled), Clause 21.2 (Maintenance of obligatory insurances), Clause 21.3 (Terms of obligatory insurances), Clause 21.5 (Renewal of obligatory insurances), Clause 22.3 (Repair and classification), Clause 22.21 (Sanctions Laws and Ship trading) or, save to the extent such breach is a failure to pay and therefore subject to Clause 24.2 (Non-payment), Clause 23 (Security Cover).
 
24.4
Other obligations
 
(a)
A Transaction Obligor or Third Party Manager does not comply with any provision of the Finance Documents (other than those referred to in Clause 24.2 (Non-payment) and Clause 24.3 (Specific obligations)).
 
(b)
No Event of Default under paragraph (a) above will occur if the failure to comply is capable of remedy and is remedied within 20 Business Days of the Lender giving notice to the Borrower or (if earlier) any Transaction Obligor or any Third Party Manager becoming aware of the failure to comply.
 
24.5
Misrepresentation
 
Any representation or statement made or deemed to be made by a Transaction Obligor or any Third Party Manager in the Finance Documents or any other document delivered by or on behalf of any Transaction Obligor under or in connection with any Finance Document is or proves to have been incorrect or misleading when made or deemed to be made.
 
24.6
Cross default
 
(a)
Any Financial Indebtedness of any Transaction Obligor is not paid when due nor within any originally applicable grace period.
 
(b)
Any Financial Indebtedness of any Transaction Obligor is declared to be or otherwise becomes due and payable prior to its specified maturity as a result of an event of default (however described).
 
(c)
Any commitment for any Financial Indebtedness of any Transaction Obligor is cancelled or suspended by a creditor of any Transaction Obligor as a result of an event of default (however described).
 
(d)
Any creditor of any Transaction Obligor becomes entitled to declare any Financial Indebtedness of any Transaction Obligor due and payable prior to its specified maturity as a result of an event of default (however described).
 
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(e)
No Event of Default will occur under this Clause 24.6 (Cross default) in respect of the Guarantor if the aggregate amount of Financial Indebtedness or commitment for Financial Indebtedness falling within paragraphs (a) to (d) above is less than in relation to the Guarantor $5,000,000 (or its equivalent in any other currency).
 
24.7
Insolvency
 
(a)
A Transaction Obligor or Third Party Manager:
 

 (i)
is unable or admits inability to pay its debts as they fall due;
 

 (ii)
is deemed to, or is declared to, be unable to pay its debts under applicable law;
 

 (iii)
suspends or threatens to suspend making payments on any of its debts; or
 

 (iv)
by reason of actual or anticipated financial difficulties, commences negotiations with one or more of its creditors (excluding the Lender in its capacity as such) with a view to rescheduling any of its indebtedness.
 
(b)
The value of the assets of any Transaction Obligor is less than its liabilities (taking into account contingent and prospective liabilities).
 
(c)
A moratorium is declared in respect of any indebtedness of any Transaction Obligor. If a moratorium occurs, the ending of the moratorium will not remedy any Event of Default caused by that moratorium.
 
24.8
Insolvency proceedings
 
(a)
Any corporate action, legal proceedings or other procedure or step is taken in relation to:
 

 (i)
the suspension of payments, a moratorium of any indebtedness, seeking bankruptcy protection, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of any Transaction Obligor or any Third Party Manager;
 

 (ii)
a composition, compromise, assignment or arrangement with any creditor of any Transaction Obligor or any Third Party Manager;
 

 (iii)
the appointment of a liquidator, receiver, administrator, administrative receiver, compulsory manager or other similar officer in respect of any Transaction Obligor or any of its assets; or
 

 (iv)
enforcement of any Security over any assets of any Transaction Obligor or any Third Party Manager,
 
or any analogous procedure or step is taken in any jurisdiction.
 
(b)
Paragraph (a) above shall not apply to any winding-up petition or other proceeding which is frivolous or vexatious and is discharged, stayed or dismissed within 14 days of commencement.
 
24.9
Creditors' process
 
 Any expropriation, attachment, sequestration, distress or execution (or any analogous process in any jurisdiction) affects any asset or assets of a Transaction Obligor (other than an arrest or detention of the Ship referred to in Clause 24.14 (Arrest)) and is not discharged within 20 Business Days.
 
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24.10
Ownership
 
The Borrower ceases to be (a) 100% directly owned by the Guarantor; or (b) directly or indirectly controlled by the Guarantor.
 
24.11
Unlawfulness, invalidity and ranking
 
(a)
It is or becomes unlawful for a Transaction Obligor to perform any of its obligations under the Finance Documents.
 
(b)
Any obligation of a Transaction Obligor under the Finance Documents is not or ceases to be legal, valid, binding or enforceable.
 
(c)
Any Finance Document ceases to be in full force and effect or to be continuing or is or purports to be determined or any Transaction Security is alleged by a party to it (other than the Lender) to be ineffective.
 
(d)
Any Transaction Security proves to have ranked after, or loses its priority to, any other Security.
 
24.12
Security imperilled
 
Any Security created or intended to be created by a Finance Document is in any way imperilled or in jeopardy.
 
24.13
Cessation of business
 
Any Transaction Obligor suspends or ceases to carry on (or threatens to suspend or cease to carry on) all or a material part of its business.
 
24.14
Arrest
 
Any arrest of the Ship or its detention in the exercise or the purported exercise of any lien or claim unless it is redelivered to the full control of the Borrower within 45 days of such arrest or detention.
 
24.15
Expropriation
 
The authority or ability of any Transaction Obligor or any Third Party Manager to conduct its business is limited or wholly or substantially curtailed by any seizure, expropriation, nationalisation, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority or other person in relation to any Transaction Obligor or any Third Party Manager or any of its assets, unless such Transaction Obligor or any Third Party Manager upon receiving notice of such event procures the release of the relevant assets and such assets are redelivered to the full control of that Transaction Obligor within 10 Business Days of such event, or any Third Party Manager other than:
 
(a)
an arrest or detention of the Ship referred to in Clause 24.14 (Arrest); or
 
(b)
any Requisition.
 
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24.16
Repudiation and rescission of agreements
 
A Transaction Obligor (or any other relevant party) rescinds or purports to rescind or repudiates or purports to repudiate a Transaction Document or any of the Transaction Security or evidences an intention to rescind or repudiate a Transaction Document or any Transaction Security or a Transaction Document or any of the Transaction Security otherwise ceases to remain in full force and effect for any reason.
 
24.17
Litigation
 
 Any litigation, arbitration or administrative, governmental, regulatory or other investigations, proceedings or any investigations of, or before, any court, arbitral body or agency are commenced or threatened, or any judgment or order of a court, arbitral body, agency or tribunal or other tribunal or any order or sanction of any governmental or other regulatory body is made, in relation to any of the Transaction Documents or the transactions contemplated in any of the Transaction Documents or against any member of the Group or their assets which have or, if adversely determined, is reasonably likely to have a Material Adverse Effect, unless (i) the relevant member of the Group has taken active measures to dispute such proceedings or disputes and such proceedings or disputes are dismissed or withdrawn within 14 days of being made or presented or (ii) the combined value of such proceedings or disputes in respect of such member of the Group (other than a Borrower) does not exceed $1,000,000 (or its equivalent in any other currency) in aggregate.
 
24.18
Sanctions Laws
 
(a)
Any Transaction Obligor, any Third Party Manager or a member of the Group becomes a Restricted Person or becomes owned or controlled by, or acts directly or indirectly on behalf of, a Restricted Person or any of such persons becomes the owner or controller of a Restricted Person.
 
(b)
Any proceeds of the Loan is made available, directly or indirectly, to or for the benefit of a Restricted Person or otherwise is, directly or indirectly, applied in a manner or for a purpose prohibited by Sanctions Laws.
 
(c)
Any Transaction Obligor, or any Third Party Manager is not in compliance with all Sanctions Laws.
 
(d)
This Clause 24.18 (Sanctions Laws) is without prejudice to any other Event of Default which may occur by reason of breach of, or non-compliance with, any of the other provisions of this Agreement which relate to Sanctions Laws.
 
24.19
Material adverse change
 
Any event or circumstance occurs which has or is reasonably likely to have a Material Adverse Effect.
 
24.20
Replacement of Manager
 
No Event of Default will occur under this Clause 24 (Events of Default) in respect of a Third Party Manager if the Borrower replaces such Third Party Manager with another Approved Manager and delivers to the Lender the documents referred in paragraph 3.2 of Part A and paragraph 2(c) of Part C of Schedule 2 (Conditions Precedent and Conditions Subsequent) within 10 Business Days from the date of either Obligor becoming aware of such occurrence.
 
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24.21
Acceleration
 
On and at any time after the occurrence of an Event of Default which is continuing the Lender may, by notice to the Borrower:
 
(a)
cancel the Commitment, whereupon it shall immediately be cancelled;
 
(b)
declare that all or part of the Loan, together with accrued interest, and all other amounts accrued or outstanding under the Finance Documents be immediately due and payable, whereupon it shall become immediately due and payable; and/or
 
(c)
declare that all or part of the Loan be payable on demand, whereupon it shall immediately become payable on demand by the Lender,
 
and the Lender may serve notices under paragraphs (a), (b) and (c) above simultaneously or on different dates and the Lender may take any action referred to in Clause 24.22 (Enforcement of security) if no such notice is served or simultaneously with or at any time after the service of any of such notice.
 
24.22
Enforcement of security
 
On and at any time after the occurrence of an Event of Default the Lender may take any action which, as a result of the Event of Default or any notice served under Clause 24.21 (Acceleration), the Lender is entitled to take under any Finance Document or any applicable law or regulation.
 
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SECTION 9

CHANGES TO PARTIES
 
25
CHANGES TO THE TRANSACTION OBLIGORS
 
25.1
Assignment or transfer by Transaction Obligors
 
No Obligor may assign any of its rights or transfer any of its rights or obligations under the Finance Documents.
 
25.2
Additional Subordinated Creditors
 
(a)
The Borrower may request that any person becomes a Subordinated Creditor, with the prior approval of the Lender, by delivering to the Lender:
 

 (i)
a duly executed Subordination Agreement
 

 (ii)
a duly executed Subordinated Debt Security; and
 

 (iii)
such constitutional documents, corporate authorisations and other documents and matters as the Lender may reasonably require, in form and substance satisfactory to the Lender, to verify that the person's obligations are legally binding, valid and enforceable and to satisfy any applicable legal and regulatory requirements.
 
A person referred to in paragraph (a) above will become a Subordinated Creditor on the date the Lender enters into the Subordination Agreement and the Subordinated Debt Security delivered under paragraph (a) above.
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SECTION 10

ADMINISTRATION
 
26
CHANGES TO THE LENDER
 
26.1
Assignment by the Lender
 
Subject to this Clause 26 (Changes to the Lender), the Lender (the "Existing Lender") may:
 
(a)
assign all (but not part) of its rights under the Finance Documents; or
 
(b)
transfer by novation any of its rights and obligations under the Finance Documents,
 
to another bank or financial institution, an Affiliate of the Existing Lender or to a trust, fund or other entity which is regularly engaged in or established for the purpose of making, purchasing or investing in loans, securities or other financial assets (the "New Lender").
 
26.2
Conditions of assignment or transfer
 
(a)
The consent of the Borrower is required for an assignment or transfer by the Existing Lender unless the assignment is:
 

 (i)
to financial institution or bank which:
 

 (A)
has a dedicated ship finance lending desk and business; and
 

 (B)
is not a trust or fund or pension fund or insurance company or another entity engaged in or established for the purposes of making, purchasing or investing in loans, securities or other financial assets;
 

 (ii)
to an Affiliate of the Existing Lender or any Subsidiaries of SinoPac Financial Holdings Company Limited;
 

 (iii)
if the Existing Lender is a fund, to a fund which is a Related Fund; or
 

 (iv)
made at a time when an Event of Default is continuing.
 
(b)
The Existing Lender shall give prior written notice of not less than 14 days before any assignment or transfer. The consent of the Borrower to an assignment or transfer must not be unreasonably withheld or delayed. The Borrower will be deemed to have given its consent five Business Days after the Existing Lender has requested it unless consent is expressly refused by the Borrower within that period.
 
(c)
If:
 

 (i)
the Existing Lender assigns or transfers any of its rights or obligations under the Finance Documents or changes its Facility Office; and
 

 (ii)
as a result of circumstances existing at the date the assignment, transfer or change occurs, a Transaction Obligor would be obliged to make a payment to the New Lender or the Existing Lender acting through its new Facility Office under Clause 12 (Tax Gross Up and Indemnities) or under that Clause as incorporated by reference or in full in any other Finance Document or Clause 13 (Increased Costs),
 
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then the New Lender or the Existing Lender acting through its new Facility Office is only entitled to receive payment under those Clauses to the same extent as the Existing Lender would have been if the assignment or change had not occurred.
 
(d)
An assignment or transfer will only be effective on:
 

 (i)
receipt by the Lender of written confirmation from the New Lender (in form and substance satisfactory to the Existing Lender) that the New Lender will assume the same obligations to the other Secured Parties as it would have been under if it were an Original Lender; and
 

 (ii)
performance by the Existing Lender of all necessary "know your customer" or other similar checks under all applicable laws and regulations in relation to such assignment to a New Lender, the completion of which the Existing Lender shall promptly notify to the New Lender.
 
(e)
Each Obligor on behalf of itself and each Transaction Obligor agrees that all rights and interests (present, future or contingent) which the Existing Lender has under or by virtue of the Finance Documents are assigned to the New Lender absolutely, free of any defects in the Existing Lender's title and of any rights or equities which the Borrower or any other Transaction Obligor had against the Existing Lender.
 
(f)
No costs or expenses in relation to such an assignment or transfer shall be borne by any Transaction Obligor.
 
(g)
The Borrower may elect to refinance the Facility in response to an assignment or transfer by the Existing Lender, and the prepayment of the Loan shall not be subject to any prepayment fees.
 
26.3
Assignment fee
 
The New Lender shall, on the date upon which an assignment takes effect, pay to the Existing Lender (for its own account) a fee of $2,000 unless the assignment is to an Affiliate of the Existing Lender.
 
26.4
Security over Lender’s rights
 
In addition to the other rights provided to the Lender under this Clause 26 (Changes to the Lender), the Lender may without consulting with or obtaining consent from any Transaction Obligor, at any time charge, assign or otherwise create Security in or over (whether by way of collateral or otherwise) all or any of its rights under any Finance Document to secure obligations of the Lender including, without limitation:
 
(a)
any charge, assignment or other Security to secure obligations to a federal reserve or central bank; and
 
(b)
if the Lender is a fund, any charge, assignment or other Security granted to any holders (or trustee or representatives of holders) of obligations owed, or securities issued, by the Lender as security for those obligations or securities,
 
except that no such charge, assignment or Security shall:
 
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(i)
release the Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or Security for the Lender as a party to any of the Finance Documents; or
 

 (ii)
require any payments to be made by a Transaction Obligor other than or in excess of, or grant to any person any more extensive rights than, those required to be made or granted to the Lender under the Finance Documents.
 
27
PAYMENT MECHANICS
 
27.1
Payments to the Lender
 
(a)
On each date on which a Transaction Obligor is required to make a payment under a Finance Document, that Transaction Obligor shall make an amount equal to such payment available to the Lender (unless a contrary indication appears in a Finance Document) for value on the due date at the time and in such funds specified by the Lender as being customary at the time for settlement of transactions in the relevant currency in the place of payment.
 
(b)
Payment shall be made to the following account:
 
Correspondent bank:
Wells Fargo Bank, N.A. (SWIFT code: )
or
Citibank, N.A., New York (SWIFT code: )
or
The Bank of New York Mellon (SWIFT code: )

Beneficiary Bank:
Bank SinoPac

Beneficiary Bank Address:
9F, No.36, Sec. 3, Nanjing E. Rd., Zhongshan Dist., Taipei,
Taiwan

SWIFT Code:
 

Beneficiary:
SINOPAC CAPITAL INT’L (HK) LTD

Beneficiary Address :
6F.&7F., No. 130, Sec. 3, Nanjing E. Rd., Zhongshan Dist., Taipei, Taiwan

Account Number:
 

Currency:
USD

or such other account in Taipei or the principal financial centre of the country of that currency (or, in relation to euro, in a principal financial centre in Taipei, such Participating Member State or London, as specified by the Lender) and with such other bank as the Lender, in each case, specifies in writing.

(c)
If a Transaction Obligor has received notification of any change to the payment account in accordance with paragraph (b) above, the Borrower shall verify such new account details with the Lender by an alternative mode of communication which is different from the mode which such Transaction Obligor received such notification before making any payment to such new account under the Finance Documents.
 
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27.2
Application of receipts; partial payments
 
(a)
If the Lender receives a payment that is insufficient to discharge all the amounts then due and payable by a Transaction Obligor under the Finance Documents, the Lender may apply that payment towards the obligations of that Transaction Obligor under the Finance Documents in any manner it may decide.
 
(b)
Paragraph (a) above will override any appropriation made by a Transaction Obligor.
 
27.3
No set-off by Transaction Obligors
 
All payments to be made by a Transaction Obligor under the Finance Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.
 
27.4
Business Days
 
(a)
Any payment under the Finance Documents which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).
 
(b)
During any extension of the due date for payment of any principal or an Unpaid Sum under this Agreement interest is payable on the principal or Unpaid Sum at the rate payable on the original due date.
 
27.5
Currency of account
 
(a)
Subject to paragraphs (b) and (c) below, dollars is the currency of account and payment for any sum due from a Transaction Obligor under any Finance Document.
 
(b)
Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred.
 
(c)
Any amount expressed to be payable in a currency other than dollars shall be paid in that other currency.
 
27.6
Change of currency
 
(a)
Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:
 

 (i)
any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Lender (after consultation with the Borrower); and
 

 (ii)
any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Lender (acting reasonably).
 
(b)
If a change in any currency of a country occurs, this Agreement will, to the extent the Lender (acting reasonably and after consultation with the Borrower) specifies to be necessary, be amended to comply with any generally accepted conventions and market practice in the Relevant Interbank Market and otherwise to reflect the change in currency.
 
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27.7
Currency conversion
 
The obligations of any Transaction Obligor to pay in the due currency shall only be satisfied to the extent of the amount of the due currency purchased after deducting the costs of conversion.
 
27.8
Disruption to Payment Systems etc.
 
If either the Lender determines (in its discretion) that a Disruption Event has occurred or the Lender is notified by the Borrower that a Disruption Event has occurred:
 
(a)
the Lender may, and shall if requested to do so by the Borrower, consult with the Borrower with a view to agreeing with the Borrower such changes to the operation or administration of the Facility as the Lender may deem necessary in the circumstances;
 
(b)
the Lender shall not be obliged to consult with the Borrower in relation to any changes mentioned in paragraph (a) above if, in its opinion, it is not practicable to do so in the circumstances and, in any event, shall have no obligation to agree to such changes;
 
(c)
any such changes agreed upon by the Lender and the Borrower shall (whether or not it is finally determined that a Disruption Event has occurred) be binding upon the Parties and any Transaction Obligor as an amendment to (or, as the case may be, waiver of) the terms of the Finance Documents; and
 
(d)
the Lender shall not be liable for any damages, costs or losses to any person, any diminution in value or any liability whatsoever (including, without limitation for negligence, gross negligence or any other category of liability whatsoever but not including any claim based on the fraud of the Lender) arising as a result of its taking, or failing to take, any actions pursuant to or in connection with this Clause 27.8 (Disruption to Payment Systems etc.).
 
28
SET-OFF
 
The Lender may set off any matured obligation due from a Transaction Obligor under the Finance Documents (to the extent beneficially owned by the Lender) against any matured obligation owed by the Lender to that Transaction Obligor, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Lender may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off.
 
29
CONDUCT OF BUSINESS BY THE LENDER
 
No provision of this Agreement will:
 
(a)
interfere with the right of the Lender to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;
 
(b)
oblige the Lender to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or
 
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(c)
oblige the Lender to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of Tax.
 
30
BAIL-IN
 
Notwithstanding any other term of any Finance Document or any other agreement, arrangement or understanding between the parties to a Finance Document, each Party acknowledges and accepts that any liability of any party to a Finance Document under or in connection with the Finance Documents may be subject to Bail-In Action by the relevant Resolution Authority and acknowledges and accepts to be bound by the effect of:
 
(a)
any Bail-In Action in relation to any such liability, including (without limitation):
 

 (i)
a reduction, in full or in part, in the principal amount, or outstanding amount due (including any accrued but unpaid interest) in respect of any such liability;
 

 (ii)
a conversion of all, or part of, any such liability into shares or other instruments of ownership that may be issued to, or conferred on, it; and
 

 (iii)
a cancellation of any such liability; and
 
(b)
a variation of any term of any Finance Document to the extent necessary to give effect to any Bail-In Action in relation to any such liability.
 
31
NOTICES
 
31.1
Communications in writing
 
Any communication to be made under or in connection with the Finance Documents shall be made in writing and, unless otherwise stated, may be made by email or letter.
 
31.2
Addresses
 
The address, emails and telephone number (and the department or officer, if any, for whose attention the communication is to be made) of each Party for any communication or document to be made or delivered under or in connection with the Finance Documents are:
 
(a)
in the case of the Borrower, that specified in Schedule 1 (The Parties); and
 
(b)
in the case of any other Transaction Obligor or the Lender, that specified in Schedule 1 (The Parties) or, if it becomes a Party after the date of this Agreement, that notified in writing to the Lender on or before the date on which it becomes a Party;
 
or any substitute address, email and telephone number or department or officer as an Obligor may notify to the Lender (or the Lender may notify to the other Parties, if a change is made by the Lender) by not less than five Business Days' notice.
 
31.3
Delivery
 
(a)
Any communication or document made or delivered by one person to another under or in connection with the Finance Documents will only be effective:
 

 (i)
if by way of fax, when received in legible form; or
 
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(ii)
if by way of letter, when it has been left at the relevant address or five Business Days after being deposited in the post postage prepaid in an envelope addressed to it at that address,
 
and, if a particular department or officer is specified as part of its address details provided under Clause 31.2 (Addresses), if addressed to that department or officer.
 
(b)
Any communication or document to be made or delivered to the Lender will be effective only when actually received by the Lender and then only if it is expressly marked for the attention of the department or officer of the Lender specified in Schedule 1 (The Parties) (or any substitute department or officer as the Lender shall specify for this purpose).
 
(c)
Any communication or document made or delivered to the Borrower in accordance with this Clause will be deemed to have been made or delivered to each of the Transaction Obligors.
 
(d)
Any communication or document which becomes effective, in accordance with paragraphs (a) to (c) above, after 5.00 p.m. in the place of receipt shall be deemed only to become effective on the following day.
 
31.4
Electronic communication
 
(a)
Any communication to be made or document to be delivered by one Party to another under or in connection with the Finance Documents may be made or delivered by electronic mail or other electronic means (including, without limitation, by way of posting to a secure website) if those two Parties:
 

 (i)
notify each other in writing of their electronic mail address and/or any other information required to enable the transmission of information by that means; and
 

 (ii)
notify each other of any change to their address or any other such information supplied by them by not less than five Business Days' notice.
 
(b)
Any such electronic communication or delivery as specified in paragraph (a) above to be made between an Obligor and the Lender may only be made in that way to the extent that those two Parties agree that, unless and until notified to the contrary, this is to be an accepted form of communication or delivery.
 
(c)
Any such electronic communication or document as specified in paragraph (a) above made or delivered by one Party to another will be effective only when actually received (or made available) in readable form and in the case of any electronic communication or document made or delivered by a Party to the Lender only if it is addressed in such a manner as the Lender shall specify for this purpose.
 
(d)
Any electronic communication or document which becomes effective, in accordance with paragraph (c) above, after 5.00 p.m. in the place in which the Party to whom the relevant communication or document is sent or made available has its address for the purpose of this Agreement shall be deemed only to become effective on the following day.
 
(e)
Any reference in a Finance Document to a communication being sent or received or a document being delivered shall be construed to include that communication or document being made available in accordance with this Clause 31.4 (Electronic communication).
 
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31.5
English language
 
(a)
Any notice given under or in connection with any Finance Document must be in English.
 
(b)
All other documents provided under or in connection with any Finance Document must be:
 

 (i)
in English; or
 

 (ii)
if not in English, and if so required by the Lender, accompanied by a certified English translation prepared by a translator approved by the Lender and, in this case, the English translation will prevail unless the document is a constitutional, statutory or other official document.
 
32
CALCULATIONS AND CERTIFICATES
 
32.1
Accounts
 
In any litigation or arbitration proceedings arising out of or in connection with a Finance Document, the entries made in the accounts maintained by the Lender are prima facie evidence of the matters to which they relate.
 
32.2
Certificates and determinations
 
Any certification or determination by the Lender of a rate or amount under any Finance Document is, in the absence of manifest error, conclusive evidence of the matters to which it relates.
 
32.3
Day count convention and interest calculation
 
Any interest, commission or fee accruing under a Finance Document will accrue from day to day and is calculated on the basis of the actual number of days elapsed and a year of 360 days or, in any case where the practice in the Relevant Market differs, in accordance with that market practice.
 
33
PARTIAL INVALIDITY
 
If, at any time, any provision of a Finance Document is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions under the law of that jurisdiction nor the legality, validity or enforceability of such provision under the law of any other jurisdiction will in any way be affected or impaired.
 
34
REMEDIES AND WAIVERS
 
(a)
No failure to exercise, nor any delay in exercising, on the part of the Lender or any Receiver or Delegate, any right or remedy under a Finance Document shall operate as a waiver of any such right or remedy or constitute an election to affirm any Finance Document. No election to affirm any Finance Document on the part of the Lender or any Receiver or Delegate shall be effective unless it is in writing. No single or partial exercise of any right or remedy shall prevent any further or other exercise or the exercise of any other right or remedy. The rights and remedies provided in each Finance Document are cumulative and not exclusive of any rights or remedies provided by law.
 
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(b)
No variation or amendment of a Finance Document shall be valid unless in writing and signed by the Lender.
 
35
ENTIRE AGREEMENT
 
(a)
This Agreement, in conjunction with the other Finance Documents, constitutes the entire agreement between the Parties and supersedes all previous agreements, understandings and arrangements between them, whether in writing or oral, in respect of its subject matter.
 
(b)
Each Party acknowledges that it has not entered into this Agreement or any other Finance Document in reliance on, and shall have no remedies in respect of, any representation or warranty that is not expressly set out in this Agreement or in any other Finance Document.
 
36
SETTLEMENT OR DISCHARGE CONDITIONAL
 
Any settlement or discharge under any Finance Document between the Lender and any Transaction Obligor shall be conditional upon no security or payment to the Lender by any Transaction Obligor or any other person being set aside, adjusted or ordered to be repaid, whether under any insolvency law or otherwise.
 
37
IRREVOCABLE PAYMENT
 
If the Lender considers that an amount paid or discharged by, or on behalf of, a Transaction Obligor or by any other person in purported payment or discharge of an obligation of that Transaction Obligor to the Lender under the Finance Documents is capable of being avoided or otherwise set aside on the liquidation or administration of that Transaction Obligor or otherwise, then that amount shall not be considered to have been unconditionally and irrevocably paid or discharged for the purposes of the Finance Documents.
 
38
AMENDMENTS
 
38.1
Required consents
 
Any term of a Finance Document may be amended only with the consent of the parties to the relevant Finance Document and its performance may be waived only by the relevant party to the relevant Finance Document.
 
38.2
Changes to reference rate
 
(a)
If a Published Rate Replacement Event has occurred in relation to any Published Rate, any amendment or waiver which relates to:
 

 (i)
providing for the use of a Replacement Reference Rate in place of (or in addition to) that Published Rate; and
 
(ii)
 

 (A)
aligning any provision of any Finance Document to the use of that Replacement Reference Rate;
 

 (B)
enabling that Replacement Reference Rate to be used for the calculation of interest under this Agreement (including, without limitation, any consequential changes required to enable that Replacement Reference Rate to be used for the purposes of this Agreement);
 
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(C)
implementing market conventions applicable to that Replacement Reference Rate;
 

 (D)
providing for appropriate fallback (and market disruption) provisions for that Replacement Reference Rate; or
 

 (E)
adjusting the pricing to reduce or eliminate, to the extent reasonably practicable, any transfer of economic value from one Party to another as a result of the application of that Replacement Reference Rate (and if any adjustment or method for calculating any adjustment has been formally designated, nominated or recommended by the Relevant Nominating Body, the adjustment shall be determined on the basis of that designation, nomination or recommendation),
 
may be made with the consent of the Lender and the Borrower.
 
(b)
In this Clause 38.2 (Changes to reference rate):
 
"Published Rate" means:
 

 (a)
SOFR; or
 

 (b)
Term SOFR for any Quoted Tenor.
 
"Published Rate Contingency Period" means, in relation to:
 

 (a)
Term SOFR (all Quoted Tenors), 10 US Government Securities Business Days; and
 

 (b)
SOFR, 10 US Government Securities Business Days.
 
"Published Rate Replacement Event" means, in relation to a Published Rate:
 

 (a)
the methodology, formula or other means of determining that Published Rate has, in the opinion of the Lender, materially changed;
 
(b)
 
(i)
 

 (A)
the administrator of that Published Rate or its supervisor publicly announces that such administrator is insolvent; or
 

 (B)
information is published in any order, decree, notice, petition or filing, however described, of or filed with a court, tribunal, exchange, regulatory authority or similar administrative, regulatory or judicial body which reasonably confirms that the administrator of that Published Rate is insolvent,
 
provided that, in each case, at that time, there is no successor administrator to continue to provide that Published Rate;
 
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(ii)
the administrator of that Published Rate publicly announces that it has ceased or will cease to provide that Published Rate permanently or indefinitely and, at that time, there is no successor administrator to continue to provide that Published Rate;
 

 (iii)
the supervisor of the administrator of that Published Rate publicly announces that such Published Rate has been or will be permanently or indefinitely discontinued; or
 

 (iv)
the administrator of that Published Rate or its supervisor announces that that Published Rate may no longer be used; or
 

 (c)
the administrator of that Published Rate (or the administrator of an interest rate which is a constituent element of that Published Rate) determines that that Published Rate should be calculated in accordance with its reduced submissions or other contingency or fallback policies or arrangements and either:
 

 (i)
the circumstance(s) or event(s) leading to such determination are not (in the opinion of the Lender) temporary; or
 

 (ii)
that Published Rate is calculated in accordance with any such policy or arrangement for a period no less than the applicable Published Rate Contingency Period; or
 

 (d)
in the opinion of the Lender, that Published Rate is otherwise no longer appropriate for the purposes of calculating interest under this Agreement.
 
"Quoted Tenor" means, in relation to Term SOFR, any period for which that rate is customarily displayed on the relevant page or screen of an information service.
 
"Relevant Nominating Body" means any applicable central bank, regulator or other supervisory authority or a group of them, or any working group or committee sponsored or chaired by, or constituted at the request of, any of them or the Financial Stability Board.
 
"Replacement Reference Rate" means a reference rate which is:
 

 (a)
formally designated, nominated or recommended as the replacement for a Published Rate by:
 

 (i)
the administrator of that Published Rate (provided that the market or economic reality that such reference rate measures is the same as that measured by that Published Rate); or
 

 (ii)
any Relevant Nominating Body,
 
and if replacements have, at the relevant time, been formally designated, nominated or recommended under both paragraphs, the "Replacement Reference Rate" will be the replacement under paragraph (ii) above;
 

 (b)
in the opinion of the Lender and the Borrower, generally accepted in the international or any relevant domestic syndicated loan markets as the appropriate successor or alternative to a Published Rate; or
 
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(c)
in the opinion of the Lender and the Borrower, an appropriate successor or alternative to a Published Rate.
 
38.3
Obligors' intent
 
Without prejudice to the generality of Clauses 1.2 (Construction) and 17.4 (Waiver of defences), each Obligor expressly confirms that it intends that any guarantee contained in this Agreement or any other Finance Document and any Security created by any Finance Document shall extend from time to time to any (however fundamental) variation, increase, extension or addition of or to any of the Finance Documents and/or any facility or amount made available under any of the Finance Documents for the purposes of or in connection with any of the following:
 

 (a)
business acquisitions of any nature;
 

 (b)
increasing working capital;
 

 (c)
enabling investor distributions to be made;
 

 (d)
carrying out restructurings;
 

 (e)
refinancing existing facilities;
 

 (f)
refinancing any other indebtedness;
 

 (g)
making facilities available to new borrowers;
 

 (h)
any other variation or extension of the purposes for which any such facility or amount might be made available from time to time; and
 

 (i)
any fees, costs and/or expenses associated with any of the foregoing.
 
39
CONFIDENTIALITY
 
39.1
Confidential Information
 
The Lender agrees to keep all Confidential Information confidential and not to disclose it to anyone, save to the extent permitted by Clause 39.2 (Disclosure of Confidential Information) and to ensure that all Confidential Information is protected with security measures and a degree of care that would apply to its own confidential information.
 
39.2
Disclosure of Confidential Information
 
The Lender may disclose:
 
(a)
to any of its Affiliates and Related Funds and any of its or their officers, directors, employees, professional advisers, insurers, reinsurers, insurance brokers, insurance advisors, auditors, partners and Representatives such Confidential Information as the Lender shall consider appropriate if any person to whom the Confidential Information is to be given pursuant to this paragraph (a) is informed in writing of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of the information or is otherwise bound by requirements of confidentiality in relation to the Confidential Information;
 
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(b)
to any person:
 

 (i)
to (or through) whom it assigns or transfers (or may potentially assign or transfer) all or any of its rights and/or obligations under one or more Finance Documents or which succeeds (or which may potentially succeed) it as Lender and, in each case, to any of that person's Affiliates, Related Funds, Representatives and professional advisers;
 

 (ii)
with (or through) whom it enters into (or may potentially enter into), whether directly or indirectly, any sub-participation in relation to, or any other transaction under which payments are to be made or may be made by reference to, one or more Finance Documents and/or one or more Transaction Obligors and to any of that person's Affiliates, Related Funds, Representatives and professional advisers;
 

 (iii)
appointed by the Lender or by a person to whom sub-paragraph (i) or (ii) of paragraph (b) above applies to receive communications, notices, information or documents delivered pursuant to the Finance Documents on its behalf;
 

 (iv)
who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in sub-paragraph (i) or (ii) of paragraph (b) above;
 

 (v)
to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law or regulation;
 

 (vi)
to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitrations, administrative or other investigations, proceedings or disputes;
 

 (vii)
to whom or for whose benefit the Lender charges, assigns or otherwise creates Security (or may do so) pursuant to Clause 26.4 (Security over Lender’s rights);
 

 (viii)
who is a Party, a member of the Group or any related entity of a Transaction Obligor;
 

 (ix)
as a result of the registration of any Finance Document as contemplated by any Finance Document or any legal opinion obtained in connection with any Finance Document; or
 

 (x)
with the consent of the Borrower;
 
in each case, such Confidential Information as the Lender shall consider appropriate if:
 

 (A)
in relation to sub-paragraphs (i), (ii) and (iii) of paragraph (b) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking except that there shall be no requirement for a Confidentiality Undertaking if the recipient is a professional adviser and is subject to professional obligations to maintain the confidentiality of the Confidential Information;
 
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(B)
in relation to sub-paragraph (iv) of paragraph (b) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking or is otherwise bound by requirements of confidentiality in relation to the Confidential Information they receive and is informed that some or all of such Confidential Information may be price-sensitive information;
 

 (C)
in relation to sub-paragraphs (v), (vi) and (vii) of paragraph (b) above, the person to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of the Lender, it is not practicable so to do in the circumstances;
 
(c)
to any person appointed by the Lender or by a person to whom sub-paragraph (i) or (ii) of paragraph (b) above applies to provide administration or settlement services in respect of one or more of the Finance Documents including without limitation, in relation to the trading of participations in respect of the Finance Documents, such Confidential Information as may be required to be disclosed to enable such service provider to provide any of the services referred to in this paragraph (c) if the service provider to whom the Confidential Information is to be given has entered in to a confidentiality agreement substantially in the form of the LMA Master Confidentiality Undertaking for Use With Administration/Settlement Service Providers or such other form of confidentiality undertaking agreed between the Borrower and the Lender;
 
(d)
to any rating agency (including its professional advisers) such Confidential Information as may be required to be disclosed to enable such rating agency to carry out its normal rating activities in relation to the Finance Documents and/or the Transaction Obligors if the rating agency to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be price sensitive information; and
 
(e)
to the U.S. Securities and Exchange Commission (the "SEC") such Confidential Information as may be required to be disclosed to the SEC.
 
39.3
DAC6
 
Nothing in any Finance Document shall prevent disclosure of any Confidential Information or other matter to the extent that preventing that disclosure would otherwise cause any transaction contemplated by the Finance Documents or any transaction carried out in connection with any transaction contemplated by the Finance Documents to become an arrangement described in Part II A 1 of Annex IV of Directive 2011/16/EU.
 
39.4
Entire agreement
 
This Clause 39 (Confidentiality) constitutes the entire agreement between the Parties in relation to the obligations of the Lender under the Finance Documents regarding Confidential Information and supersedes any previous agreement, whether express or implied, regarding Confidential Information.
 
39.5
Inside information
 
The Lender acknowledges that some or all of the Confidential Information is or may be price-sensitive information and that the use of such information may be regulated or prohibited by applicable legislation including securities law relating to insider dealing and market abuse and the Lender undertakes not to use any Confidential Information for any unlawful purpose.
 
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39.6
Notification of disclosure
 
The Lender agrees (to the extent permitted by law and regulation) to inform the Borrower:
 
(a)
of the circumstances of any disclosure of Confidential Information made pursuant to sub-paragraph (v) of paragraph (b) of Clause 39.2 (Disclosure of Confidential Information) except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
 
(b)
upon becoming aware that Confidential Information has been disclosed in breach of this Clause 39 (Confidentiality).
 
39.7
Continuing obligations
 
The obligations in this Clause 39 (Confidentiality) are continuing and, in particular, shall survive and remain binding on the Lender for a period of 12 months from the earlier of:
 
(a)
the date on which all amounts payable by the Obligors under or in connection with this Agreement have been paid in full and the Commitment has been cancelled or otherwise ceased to be available; and
 
(b)
the date on which the Lender otherwise ceases to be the Lender.
 
40
CONFIDENTIALITY OF FUNDING RATES
 
40.1
Confidentiality and disclosure
 
(a)
Each Obligor agrees to keep each Funding Rate confidential and not to disclose it to anyone, save to the extent permitted by applicable provisions of this Clause.
 
(b)
Each Obligor may disclose any Funding Rate to:
 

 (i)
any of its Affiliates and any of its or their officers, directors, employees, professional advisers, auditors, partners and Representatives if any person to whom that Funding Rate is to be given pursuant to this sub-paragraph (i) is informed in writing of its confidential nature and that it may be price sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of that Funding Rate or is otherwise bound by requirements of confidentiality in relation to it;
 

 (ii)
any person to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law or regulation if the person to whom that Funding Rate is to be given is informed in writing of its confidential nature and that it may be price sensitive information except that there shall be no requirement to so inform if, in the opinion of the Lender or the relevant Borrower, as the case may be, it is not practicable to do so in the circumstances;
 
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(iii)
any person to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes if the person to whom that Funding Rate is to be given is informed in writing of its confidential nature and that it may be price sensitive information except that there shall be no requirement to so inform if, in the opinion of the Lender or the relevant Borrower, as the case may be, it is not practicable to do so in the circumstances; and
 

 (iv)
any person with the consent of the Lender.
 
40.2
Related obligations
 
(a)
Each Obligor acknowledges that each Funding Rate is or may be price sensitive information and that its use may be regulated or prohibited by applicable legislation including securities law relating to insider dealing and market abuse and each Obligor undertakes not to use any Funding Rate for any unlawful purpose.
 
(b)
Each Obligor agrees (to the extent permitted by law and regulation) to inform the Lender:
 

 (i)
of the circumstances of any disclosure made pursuant to sub-paragraph (ii) of paragraph (b) of Clause 40.1 (Confidentiality and disclosure) except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
 

 (ii)
upon becoming aware that any information has been disclosed in breach of this Clause 40 (Confidentiality of Funding Rates).
 
40.3
No Event of Default
 
No Event of Default will occur under Clause 24.4 (Other obligations) by reason only of an Obligor's failure to comply with this Clause 40 (Confidentiality of Funding Rates).
 
41
COUNTERPARTS
 
Each Finance Document may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of the Finance Document.
 
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SECTION 11
GOVERNING LAW AND ENFORCEMENT
 
42
GOVERNING LAW
 
This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.
 
43
ENFORCEMENT
 
(a)
Any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or any non-contractual obligation arising out of or in connection with this Agreement) (a "Dispute") shall be referred to arbitration in London in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect to the provisions of this Clause 43 (Enforcement).
 
(b)
The arbitration shall be conducted in accordance with the London Maritime Arbitrators Association (“LMAA”) Terms current at the time when the arbitration proceedings are commenced.
 
(c)
The seat of the arbitration shall be London, England, even where any hearing takes place outside England.
 
(d)
The reference shall be to three (3) arbitrators. A Party wishing to refer a Dispute to arbitration shall appoint its arbitrator and send notice of such appointment in writing to the other Party requiring the other Party to appoint its own arbitrator within fourteen (14) calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other Party appoints its own arbitrator and gives notice that it has done so within the fourteen (14) days specified. If the other Party does not appoint its own arbitrator and give notice that it has done so within the fourteen (14) days specified, the Party referring a Dispute to arbitration may, without the requirement of any further prior notice to the other Party, appoint its arbitrator as sole arbitrator and shall advise the other Party accordingly. The award of a sole arbitrator shall be binding on both Parties as if he had been appointed by agreement.
 
(e)
Nothing herein shall prevent the Parties agreeing in writing to vary these provisions to provide for the appointment of a sole arbitrator.
 
(f)
In cases where neither the claim nor any counterclaim exceeds the sum of US$200,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the LMAA Small Claims Procedure current at the time when the arbitration proceedings are commenced.
 
(g)
The language of any arbitration proceedings shall be English.
 
This Agreement has been entered into on the date stated at the beginning of this Agreement. This Agreement has been executed and entered into by the Guarantor as a deed and is intended to be and is delivered by the Guarantor as a deed.
 
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SCHEDULE 1

THE PARTIES
 
PART A

THE OBLIGORS
 
Name of Borrower
Place of
Incorporation
Entity number
Address for
Communication
       
Chrisea Maritime Co.
The Republic of the Marshall Islands
118257
c/o 154 Vouliagmenis Avenue, 16674, Glyfada, Athens, Greece
 
Attention: Stamatios Tsantanis/ Stavros Gyftakis
 
Email:
 
Tel.:
       
Name of Guarantor
Place of
Incorporation
Entity number
Address for
Communication
       
United Maritime Corporation
The Republic of the Marshall Islands
112801
c/o 154 Vouliagmenis Avenue, 16674, Glyfada, Athens, Greece
 
Attention: Stamatios Tsantanis/ Stavros Gyftakis
 
Email:
 
Tel.:



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PART B

THE ORIGINAL LENDER
 
Name of Original
Lender
Commitment
Registration number
Address for
Communication
       
SinoPac Capital International (HK) Limited
 
$16,500,000
71963750
6F., No. 130, Sec. 3, Nanjing E. Rd., Zhongshan Dist., Taipei City 104, Taiwan
 
Email: 

Attn: Andy Chang / Allen Chi



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SCHEDULE 2

CONDITIONS PRECEDENT AND CONDITIONS SUBSEQUENT
 
PART A

CONDITIONS PRECEDENT TO UTILISATION REQUEST
 
1
Obligors
 
1.1
A copy of the constitutional documents of each Obligor.
 
1.2
A copy of a resolution of the board of directors of each Obligor (in relation to the Guarantor, a copy of a resolution of the board of directors certified under the original certificate in paragraph 1.8):
 
(a)
approving the terms of, and the transactions contemplated by, the Finance Documents to which it is a party and resolving that it execute the Finance Documents to which it is a party;
 
(b)
authorising a specified person or persons to execute the Finance Documents to which it is a party on its behalf; and
 
(c)
authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices (including, if relevant, the Utilisation Request) to be signed and/or despatched by it under, or in connection with, the Finance Documents to which it is a party.
 
1.3
A copy of the power of attorney of each Obligor authorising a specified person or persons to execute the Finance Documents to which it is a party.
 
1.4
A specimen of the signature or copy of the passport of each person authorised by the resolution referred to in paragraph 1.2 above.
 
1.5
A copy of a resolution signed by all the holders of the issued shares in the Borrower, approving the terms of, and the transactions contemplated by, the Finance Documents to which it is a party.
 
1.6
A copy of certificate of each Obligor (signed by an officer) confirming that borrowing, securing or guaranteeing, as appropriate, the Commitment would not cause any borrowing, securing, guaranteeing or similar limit binding on it to be exceeded.
 
1.7
A copy of certificate of each Obligor that is incorporated outside the UK (signed by an officer) certifying either that (i) it has not delivered particulars of any UK Establishment to the Registrar of Companies as required under the Overseas Regulations or (ii) it has a UK Establishment and specifying the name and registered number under which it is registered with the Registrar of Companies.
 
1.8
A copy of certificate of an authorised signatory of the relevant Obligor confirming the names and offices of all the directors of that Obligor and certifying that each copy document relating to it specified in this Part A of Schedule 2 (Conditions Precedent and Conditions Subsequent) is correct, complete and in full force and effect as at a date no earlier than the date of this Agreement.
 
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113 SinoPac Capital – Facility Agreement
1.9
Documentary evidence satisfactory to the Lender showing the legal and beneficial ownership of the Borrower.
 
2
Finance Documents
 
2.1
Duly executed originals of the following Finance Documents (and of each document to be delivered under each of them):
 
(a)
this Agreement; and
 
(b)
any Fee Letter.
 
2.2
Agreed forms of the following Finance Documents:
 
(a)
the Mortgage;
 
(b)
the General Assignment;
 
(c)
any Manager’s Undertaking; and
 
(d)
the Shares Security.
 
3
Ship
 
3.1
Documentary evidence that the Ship is definitively and permanently registered in the name of the Seller under the Approved Flag.
 
3.2
Documents establishing that the Ship is managed commercially by its Approved Commercial Managers, technically by its Approved Technical Manager and the crew of the Ship is managed by the Approved Crew Manager on terms acceptable to the Lender, together with copies of:
 
(a)
the Approved Technical Manager's Document of Compliance; and
 
(b)
the Ship's Safety Management Certificate (together with any other details of the applicable Safety Management System which the Lender requires), the Class Certificate and of any other documents required under the ISM Code and the ISPS Code in relation to the Ship including without limitation an ISSC.
 
3.3
One valuation of the Ship dated not more than three Months prior to the Utilisation Date for determination of the Fair Market Value of the Ship as at the Utilisation Date.
 
4
Other documents and evidence
 
4.1
In relation to the MOA:
 
(a)
duly executed and dated copies of the MOA and any addenda thereunder (if applicable); and
 
(b)
a duly executed and dated copy of the Escrow Agreement.
 
4.2
If applicable, a copy of any Assignable Charter in respect of the Ship duly executed by the parties thereto and of each document delivered pursuant to it, together with such documentary evidence as the Lender and its legal advisers may require in relation to the due authorisation and execution of that Assignable Charter by each of the parties thereto.
 
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114 SinoPac Capital – Facility Agreement
4.3
A copy of any other Authorisation or other document, opinion or assurance which the Lender considers to be necessary or desirable (if it has notified the Borrower accordingly) in connection with the entry into and performance of the transactions contemplated by any Transaction Document, or for the validity and enforceability of any Transaction Document.
 
4.4
Copies of the Original Financial Statements of the Borrower and the Guarantor.
 
4.5
Satisfactory completion of the Lender's compliance and due diligence requirements in connection with the "know your customer" process or similar identification procedures in relation to the transactions contemplated by the Finance Documents.
 
4.6
Documentary evidence that the Earnings Account has been opened.
 
4.7
Unless deducted from the amount of the Utilisation in accordance with paragraph (a) of Clause 20.31 (Application of Security Deposit Amount in the case of mandatory prepayment and Event of Default), evidence satisfactory to the Lender that the Security Deposit Amount has been deposited to the Security Deposit Account.
 
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PART B

CONDITIONS PRECEDENT TO UTILISATION
 
1
Finance Documents
 
Duly executed but undated originals of the following Finance Documents (and of each document to be delivered under each of them):
 
(a)
the Mortgage;
 
(b)
the General Assignment;
 
(c)
a Manager's Undertaking of each of the Approved Commercial Manager, the Approved Technical Manager and the Approved Crew Manager; and
 
(d)
the Shares Security.
 
2
Ship and funding
 
2.1
If applicable, evidence that all sums then due (if any) to the Seller, other than the sums to be financed pursuant to the Utilisation, have been or will be paid by the Borrower to the Seller or the Escrow Agent on the Release Date.
 
2.2
Documentary evidence that the Ship will, as from the Release Date:
 
(a)
be definitively and provisionally registered in the name of the Borrower under the Approved Flag; and
 
(b)
be in the absolute and unencumbered ownership of the Borrower save as contemplated by the Finance Documents.
 
3
Insurance
 
3.1
Documents establishing that the Ship will, as from the Release Date, be insured in accordance with the provisions of this Agreement, namely:
 
(a)
agreed forms of all policies relating to the obligatory insurances of the Ship required under Clause 21.2 (Maintenance of obligatory insurances), together with agreed forms of all letters of undertaking issued by the Approved Brokers and any protection and indemnity and/or war risks associations in which the Ship is entered relating to such obligatory insurances;
 
(b)
an agreed form of the policies relating to mortgagee's interest marine insurance and a mortgagee's interest additional perils insurance required under Clause 21.16 (Mortgagee's interest and additional perils insurances); and
 
(c)
an agreed form of opinion from an independent insurance consultant appointed by the Lender on such matters relating to the Insurances as the Lender may require.
 
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116 SinoPac Capital – Facility Agreement
4
Other documents and evidence
 
Evidence that the fees, costs and expenses then due from the Borrower pursuant to Clause 11 (Fees) and Clause 16 (Costs and Expenses) have been paid or will be paid by the Utilisation Date.
 
5
Legal opinions
 
5.1
An agreed form of a legal opinion of Watson Farley & Williams LLP, legal advisers to the Lender in relation to English law.
 
5.2
An agreed form of a legal opinion of Watson Farley & Williams LLP, legal advisers to the Lender in relation to Marshall Islands law.
 
5.3
An agreed form of any legal opinion by lawyers appointed by the Lender on such matters on the laws of any other jurisdiction as the Lender may require.
 
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117 SinoPac Capital – Facility Agreement
PART C
 
CONDITIONS PRECEDENT ON RELEASE DATE
 
1
Obligors
 
1.1
A certificate of an authorised signatory of each Obligor certifying that each copy document which it is required to provide under Part A of Schedule 2 (Conditions Precedent and Conditions Subsequent) is correct, complete and in full force and effect as at the Release Date.
 
1.2
A certificate of good standing in respect of each Obligor, each dated no earlier than the date falling 1 month prior to the Release Date (or such other date as may be acceptable to the Lender).
 
2
Finance Documents
 
Duly executed and dated originals of the following Finance Documents (and of each document to be delivered under each of them):
 
(a)
the Mortgage;
 
(b)
the General Assignment;
 
(c)
a Manager's Undertaking of each Approved Manager; and
 
(d)
the Shares Security.
 
3
Ship
 
3.1
A duly executed copy of the Mortgage together with documentary evidence that (a) the Mortgage has been duly registered or recorded (as the case may be) as a valid first preferred or priority (as the case may be) ship mortgage in accordance with the laws of the jurisdiction of its Approved Flag and (b) the Ship is in the absolute and unencumbered ownership of the Borrower save as contemplated by the Finance Documents.
 
3.2
Documentary evidence that the Ship:
 
(a)
has been unconditionally delivered by the Seller to, and accepted by, the Borrower under the MOA and that the full purchase price payable and all other sums due to the Seller under the MOA and other related documents, other than the sums to be financed pursuant to the Utilisation, have been paid (or released by the Escrow Agent to the Seller;
 
(b)
is definitively and provisionally registered in the name of the Borrower under the Approved Flag;
 
(c)
is in the absolute and unencumbered ownership of the Borrower save as contemplated by the Finance Documents; and
 
(d)
maintains the Approved Classification with the Approved Classification Society free of all overdue recommendations and conditions of the Approved Classification Society.
 
3.3
A copy of the commercial invoice issued by the Seller to the Borrower evidencing the Purchase Price payable under the MOA.
 
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118 SinoPac Capital – Facility Agreement
PART D
 
CONDITIONS SUBSEQUENT
 
1
Legal opinions
 
No later than three Business Days after the Release Date:
 
(a)
a legal opinion of Watson Farley & Williams LLP, legal advisers to the Lender in relation to English law.
 
(b)
a legal opinion of Watson Farley & Williams LLP, legal advisers to the Lender in relation to Marshall Islands law.
 
(c)
a legal opinion of any other lawyers appointed by the Lender on such matters and laws of any other jurisdiction as the Lender may require.
 
2
Insurances
 
(a)
No later than the fifteenth Business Day after the Release Date, copies of all policies relating to the obligatory insurances of the Ship required under Clause 21.2 (Maintenance of obligatory insurances), together with copies of all executed letters of undertaking issued by the Approved Brokers and any protection and indemnity and/or war risks associations in which the Ship is entered relating to such obligatory insurances.
 
(b)
No later than the one Month after the Release Date:
 

 (i)
copies of the policies relating to mortgagee's interest marine insurance and a mortgagee's interest additional perils insurance required under Clause 21.16 (Mortgagee's interest and additional perils insurances); and
 

 (ii)
an issued opinion from an independent insurance consultant appointed by the Lender on such matters relating to the Insurances as the Lender may require.
 
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119 SinoPac Capital – Facility Agreement
SCHEDULE 3

UTILISATION REQUEST
 
From:
Chrisea Maritime Co.
a corporation incorporated in the Republic of the Marshall Islands
as Borrower

To:
SinoPac Capital International (HK) Limited
a company incorporated in Hong Kong with limited liability
as Lender

 Dated:    [●]

Dear Sirs
 
Chrisea Maritime Co. – $16,500,000 Facility Agreement dated [●] 2024 (the "Agreement")
 
1
We refer to the Agreement. This is the Utilisation Request. Terms defined in the Agreement have the same meaning in this Utilisation Request unless given a different meaning in this Utilisation Request.
 
2
We wish to borrow the Loan on the following terms:
 
Proposed Utilisation Date:
[●] (or, if that is not a Business Day, the next Business Day)
     
 
 Amount:
$[●]
     
  Interest Period: [●]
        
3
We confirm that each condition specified in Clause 4.1 (Initial conditions precedent) and Clause 4.2 (Further conditions precedent) of the Agreement is satisfied on the date of this Utilisation Request.
 
4
We represent and warrant that the representations and warranties in Clause 18 (Representations) remain true by reference to the facts and circumstances existing at the date of this, Utilisation Request.
 
5
 You are authorised and requested to deduct from the Loan the facility fee payable under Clause 11.1 (Facility fee) and the Security Deposit Amount prior to funds being remitted.
 
6
The balance of the proceeds of the Loan after the deductions contemplated under paragraph 5 above should be credited to [account].
 
7
This Utilisation Request is irrevocable.
 
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120 SinoPac Capital – Facility Agreement
Yours faithfully
  

 
For and on behalf of
CHRISEA MARITIME CO.
  
   

 
Name:
  
Title:
  



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121 SinoPac Capital – Facility Agreement
SCHEDULE 4

LIST OF APPROVED VALUERS
 
Shipbroker
Country
   
Clarksons Valuations Limited
United Kingdom
   
Maersk Broker
Denmark
   
Simpson Spence Young
United Kingdom
   
Howe Robinson Partners
Singapore
   
Arrow Valuations
United Kingdom
   
Fearnleys AS
Norway/Singapore
   
Barry-Rogliano Salles (BRS)
France



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122 SinoPac Capital – Facility Agreement
SCHEDULE 5

TIMETABLES
 
Delivery of the duly completed Utilisation Request
(Clause 5.1 (Delivery of Utilisation Request))
Two Business Days before the intended Utilisation Date
(Clause 5.1 (Delivery of  Utilisation Request))
   
Reference Rate is fixed
Quotation Day
 
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123 SinoPac Capital – Facility Agreement
EXECUTION PAGES
 
BORROWER
    
     
SIGNED by Stavros Gyftakis
  
)  /s/ Stavros Gyftakis
duly authorised
  
)
for and on behalf of
  
)
CHRISEA MARITIME CO.
  
)
its attorney-in-fact
  
)
In the presence of:
  
)

Witness' signature:
  
) /s/ Maria Moschopoulou
Witness' name: Maria Moschopoulou
  
)
Witness' address:154 Vouliagmenis Avenue
  
)
166 74 Glyfada, Athens Greece    

GUARANTOR
    
     
EXECUTED AS A DEED by Stamatios Tsantanis
  
)  /s/ Stamatios Tsantanis
duly authorised attorney-in-fact
  
)
for and on behalf of
  
)
UNITED MARITIME CORPORATION
  
)
its attorney-in-fact
  
)
in the presence of:
  
)

Witness' signature:
  
) /s/ Maria Moschopoulou
Witness' name: Maria Moschopoulou
  
)
Witness' address:154 Vouliagmenis Avenue
  
)
166 74 Glyfada, Athens Greece
  



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124 SinoPac Capital – Facility Agreement
ORIGINAL LENDER

SIGNED by Wang Ying Ju
  
)   /s/ Wang Ying Ju
duly authorised
  
)
for and on behalf of
  
)
SINOPAC CAPITAL INTERNATIONAL (HK) LIMITED
  
)
its authorised signatory
  
)
in the presence of:
  
)

Witness' signature:
  
)  /s/ CHI, CHUAN YU
Witness' name: CHI, CHUAN YU
  
)
Witness' address: 6F & 7F, No. 130, Sec. 3, Nanjing E. Rd., Zhongshan Dis., Taipei City, Taiwan




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125 SinoPac Capital – Facility Agreement
EX-8.1 15 ef20039046_ex8-1.htm EXHIBIT 8.1
Exhibit 8.1

Subsidiaries of United Maritime Corporation

 
Subsidiary
  
Jurisdiction of incorporation
  
 
Sea Glorius Shipping Co.
  
Republic of the Marshall Islands
  
 
Epanastasea Maritime Co.
  
Republic of the Marshall Islands
  
 
Minoansea Maritime Co.
  
Republic of the Marshall Islands
  
 
Traders Maritime Co.
  
Republic of the Marshall Islands
  
 
Oasea Maritime Co.
  
Republic of the Marshall Islands
  
 
Cretansea Maritime Co.
  
Republic of the Marshall Islands
  
 
Chrisea Maritime Co.
  
Republic of the Marshall Islands
  
 
Exelixsea Maritime Co.
  
Republic of the Marshall Islands
  
 
United Management Corp.
  
Republic of the Marshall Islands
  
 
Good Maritime Co.
  
Republic of Liberia
  
 
Synthesea Maritime Co.
  
Republic of Liberia
  
 
Nisea Maritime Co.
  
Republic of Liberia
  


EX-12.1 16 ef20039046_ex12-1.htm EXHIBIT 12.1
Exhibit 12.1

CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER

I, Stamatios Tsantanis, certify that:

1.           I have reviewed this annual report on Form 20-F of United Maritime Corporation (the “Company”);

2.          Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.          Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4.          The Company's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

(a)         Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)        Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c)          Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)         Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and

5.          The Company's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):

(a)         All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

(b)        Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

Date: April 10, 2025

/s/ Stamatios Tsantanis
Stamatios Tsantanis
Chairman, Chief Executive Officer and Director (Principal Executive Officer)


EX-12.2 17 ef20039046_ex12-2.htm EXHIBIT 12.2
Exhibit 12.2

CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER

I, Stavros Gyftakis, certify that:

1.           I have reviewed this annual report on Form 20-F of United Maritime Corporation (the “Company”);

2.          Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.          Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4.          The Company's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

(a)         Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)        Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c)          Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)         Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and

5.          The Company's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):

(a)         All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

(b)        Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

Date: April 10, 2025

/s/ Stavros Gyftakis
Stavros Gyftakis
Chief Financial Officer and Director (Principal Financial Officer)


EX-13.1 18 ef20039046_ex13-1.htm EXHIBIT 13.1
Exhibit 13.1

PRINCIPAL EXECUTIVE OFFICER CERTIFICATION
PURSUANT TO 18 U.S.C. SECTION 1350
 
In connection with this annual report of United Maritime Corporation (the "Company") on Form 20-F for the year ended December 31, 2024 as filed with the Securities and Exchange Commission (the "SEC") on or about the date hereof (the "Report"), I, Stamatios Tsantanis, Chairman, Chief Executive Officer and Director of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
 
     (1)  the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
     (2)  the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

Date: April 10, 2025
 
/s/ Stamatios Tsantanis
Stamatios Tsantanis
Chairman, Chief Executive Officer and Director (Principal Executive Officer)


EX-13.2 19 ef20039046_ex13-2.htm EXHIBIT 13.2
Exhibit 13.2



PRINCIPAL FINANCIAL OFFICER CERTIFICATION
PURSUANT TO 18 U.S.C. SECTION 1350
 
In connection with this annual report of United Maritime Corporation (the "Company") on Form 20-F for the year ended December 31, 2024 as filed with the Securities and Exchange Commission (the "SEC") on or about the date hereof (the "Report"), I, Stavros Gyftakis, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
 
     (1)  the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
     (2)  the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.
 
Date: April 10, 2025
 
/s/ Stavros Gyftakis
Stavros Gyftakis
Chief Financial Officer and Director (Principal Financial Officer)


EX-15.1 20 ef20039046_ex15-1.htm EXHIBIT 15.1
Exhibit 15.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:

 
(1)
Registration Statement (Form F-3 No. 333-273116) of United Maritime Corporation, and

 
(2)
Registration Statement (Form F-3 No. 333-266099) of United Maritime Corporation;

of our report dated April 10, 2025, with respect to the consolidated financial statements of United Maritime Corporation included in this Annual Report (Form 20-F) for the year ended December 31, 2024.

/s/ Ernst & Young (Hellas) Certified Auditors Accountants S.A.
 
Athens, Greece
April 10, 2025


EX-15.2 21 ef20039046_ex15-2.htm EXHIBIT 15.2
Exhibit 15.2

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:
 

 (1)
Registration Statement (Form F-3 No. 333-273116) of United Maritime Corporation, and
 

 (2)
Registration Statement (Form F-3 No. 333-266099) of United Maritime Corporation;
 
of our report dated April 4, 2023, with respect to the carve-out financial statements of United Maritime Predecessor included in the Annual Report (Form 20-F) of United Maritime Corporation for the year ended December 31, 2024.
 
/s/ Ernst & Young (Hellas) Certified Auditors Accountants S.A.
 
Athens, Greece
April 10, 2025
 
EX-15.3 22 ef20039046_ex15-3.htm EXHIBIT 15.3
Exhibit 15.3

CONSENT OF WATSON FARLEY & WILLIAMS LLP

Reference is made to the annual report on Form 20-F of United Maritime Corporation (the “Company”) for the year ended December 31, 2024 (the “Annual Report”) and the Registration Statements on Form F-3 (File Nos. 333-273116 and 333-266099) of the Company including the prospectuses contained therein (together, the “Registration Statements”). We hereby consent to (i) the filing of this letter as an exhibit to the Annual Report, which is incorporated by reference into the Registration Statements and (ii) each reference to us and the discussions of advice provided by us in the Annual Report under the section “Item 10. Additional Information—E. Taxation” and to the incorporation by reference of the same in the Registration Statements, in each case, without admitting we are “experts” within the meaning of the Securities Act of 1933, as amended, or the rules and regulations of the U.S. Securities and Exchange Commission promulgated thereunder with respect to any part of the Registration Statements.
 
/s/ Watson Farley & Williams LLP
Watson Farley & Williams LLP
New York, New York
April 10, 2025