false FY 0001386716 Yes No Yes Yes http://fasb.org/us-gaap/2023#RelatedPartyMember http://fasb.org/us-gaap/2023#RelatedPartyMember http://fasb.org/us-gaap/2023#RelatedPartyMember http://fasb.org/us-gaap/2023#RelatedPartyMember 0001386716 2023-01-01 2023-12-31 0001386716 dei:BusinessContactMember 2023-01-01 2023-12-31 0001386716 2023-12-31 0001386716 2022-12-31 0001386716 us-gaap:LongTermDebtMember 2022-12-31 0001386716 us-gaap:LongTermDebtMember 2023-12-31 0001386716 us-gaap:CapitalLeaseObligationsMember 2022-12-31 0001386716 us-gaap:CapitalLeaseObligationsMember 2023-12-31 0001386716 us-gaap:PreferredStockMember 2023-12-31 0001386716 us-gaap:PreferredStockMember 2022-12-31 0001386716 us-gaap:CommonStockMember 2023-12-31 0001386716 us-gaap:CommonStockMember 2022-12-31 0001386716 2021-01-01 2021-12-31 0001386716 2022-01-01 2022-12-31 0001386716 us-gaap:CommonStockMember 2020-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2020-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-12-31 0001386716 us-gaap:RetainedEarningsMember 2020-12-31 0001386716 sblk:TreasuryStockIMember 2020-12-31 0001386716 2020-12-31 0001386716 us-gaap:CommonStockMember 2021-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-12-31 0001386716 us-gaap:RetainedEarningsMember 2021-12-31 0001386716 sblk:TreasuryStockIMember 2021-12-31 0001386716 2021-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2022-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-12-31 0001386716 us-gaap:RetainedEarningsMember 2022-12-31 0001386716 sblk:TreasuryStockIMember 2022-12-31 0001386716 us-gaap:CommonStockMember 2021-01-01 2021-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-01-01 2021-12-31 0001386716 us-gaap:RetainedEarningsMember 2021-01-01 2021-12-31 0001386716 sblk:TreasuryStockIMember 2021-01-01 2021-12-31 0001386716 sblk:EnetiVesselsMember us-gaap:CommonStockMember 2021-01-01 2021-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember sblk:EnetiVesselsMember 2021-01-01 2021-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember sblk:EnetiVesselsMember 2021-01-01 2021-12-31 0001386716 us-gaap:RetainedEarningsMember sblk:EnetiVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:TreasuryStockIMember sblk:EnetiVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:EnetiVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:ERVesselsMember us-gaap:CommonStockMember 2021-01-01 2021-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember sblk:ERVesselsMember 2021-01-01 2021-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember sblk:ERVesselsMember 2021-01-01 2021-12-31 0001386716 us-gaap:RetainedEarningsMember sblk:ERVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:TreasuryStockIMember sblk:ERVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:ERVesselsMember 2021-01-01 2021-12-31 0001386716 us-gaap:CommonStockMember 2022-01-01 2022-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2022-01-01 2022-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-01-01 2022-12-31 0001386716 us-gaap:RetainedEarningsMember 2022-01-01 2022-12-31 0001386716 sblk:TreasuryStockIMember 2022-01-01 2022-12-31 0001386716 us-gaap:CommonStockMember 2023-01-01 2023-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2023-01-01 2023-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-01-01 2023-12-31 0001386716 us-gaap:RetainedEarningsMember 2023-01-01 2023-12-31 0001386716 sblk:TreasuryStockIMember 2023-01-01 2023-12-31 0001386716 us-gaap:CommonStockMember sblk:SongaSharesMember 2023-01-01 2023-12-31 0001386716 us-gaap:AdditionalPaidInCapitalMember 2023-12-31 0001386716 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-12-31 0001386716 us-gaap:RetainedEarningsMember 2023-12-31 0001386716 sblk:TreasuryStockIMember 2023-12-31 0001386716 srt:MinimumMember 2023-12-31 0001386716 srt:MaximumMember 2023-12-31 0001386716 sblk:FleetMember 2023-12-31 0001386716 sblk:FiveKamsarmaxNewbuildingVesselsIMember 2023-12-31 0001386716 sblk:FiveKamsarmaxNewbuildingVesselsIMember 2023-01-01 2023-12-31 0001386716 sblk:SixNewBuildingVesselsCharterInAgreementsMember 2023-01-01 2023-12-31 0001386716 sblk:EagleMergerAgreementMember 2023-12-11 0001386716 sblk:EagleMergerAgreementMember 2023-01-01 2023-12-31 0001386716 srt:MaximumMember 2023-01-01 2023-12-31 0001386716 sblk:GoliathMember 2023-01-01 2023-12-31 0001386716 sblk:GargantuaMember 2023-01-01 2023-12-31 0001386716 sblk:StarGina2GRMember 2023-01-01 2023-12-31 0001386716 sblk:MaharajMember 2023-01-01 2023-12-31 0001386716 sblk:StarLeo1Member 2023-01-01 2023-12-31 0001386716 sblk:StarLaetitia1Member 2023-01-01 2023-12-31 0001386716 sblk:StarAriadneMember 2023-01-01 2023-12-31 0001386716 sblk:StarVirgoMember 2023-01-01 2023-12-31 0001386716 sblk:StarLibraMember 2023-01-01 2023-12-31 0001386716 sblk:StarSienna1Member 2023-01-01 2023-12-31 0001386716 sblk:StarMarisaMember 2023-01-01 2023-12-31 0001386716 sblk:StarKarlie1Member 2023-01-01 2023-12-31 0001386716 sblk:StarEleni1Member 2023-01-01 2023-12-31 0001386716 sblk:StarMagnanimus1Member 2023-01-01 2023-12-31 0001386716 sblk:DebbieH1Member 2023-01-01 2023-12-31 0001386716 sblk:StarAyesha1Member 2023-01-01 2023-12-31 0001386716 sblk:KatieK1Member 2023-01-01 2023-12-31 0001386716 sblk:LeviathanMember 2023-01-01 2023-12-31 0001386716 sblk:PeloreusMember 2023-01-01 2023-12-31 0001386716 sblk:StarClaudine1Member 2023-01-01 2023-12-31 0001386716 sblk:StarOphelia1Member 2023-01-01 2023-12-31 0001386716 sblk:StarPaulineMember 2023-01-01 2023-12-31 0001386716 sblk:StarMarthaMember 2023-01-01 2023-12-31 0001386716 sblk:PantagrueIMember 2023-01-01 2023-12-31 0001386716 sblk:StarLyra1Member 2023-01-01 2023-12-31 0001386716 sblk:StarBorneoMember 2023-01-01 2023-12-31 0001386716 sblk:StarBuenoMember 2023-01-01 2023-12-31 0001386716 sblk:StarMarilenaMember 2023-01-01 2023-12-31 0001386716 sblk:StarJanniMember 2023-01-01 2023-12-31 0001386716 sblk:StarMarianneMember 2023-01-01 2023-12-31 0001386716 sblk:StarAngieMember 2023-01-01 2023-12-31 0001386716 sblk:BigFishMember 2023-01-01 2023-12-31 0001386716 sblk:KymopoliaMember 2023-01-01 2023-12-31 0001386716 sblk:StarTriumphMember 2023-01-01 2023-12-31 0001386716 sblk:StarScarlettMember 2023-01-01 2023-12-31 0001386716 sblk:StarAudreyMember 2023-01-01 2023-12-31 0001386716 sblk:BigBangMember 2023-01-01 2023-12-31 0001386716 sblk:StarPaolaMember 2023-01-01 2023-12-31 0001386716 sblk:StarEvaMember 2023-01-01 2023-12-31 0001386716 sblk:AmamiIMember 2023-01-01 2023-12-31 0001386716 sblk:MadredeusIMember 2023-01-01 2023-12-31 0001386716 sblk:StarSirius2Member 2023-01-01 2023-12-31 0001386716 sblk:StarVega2Member 2023-01-01 2023-12-31 0001386716 sblk:StarAphroditeMember 2023-01-01 2023-12-31 0001386716 sblk:StarPieraMember 2023-01-01 2023-12-31 0001386716 sblk:StarDespoinaMember 2023-01-01 2023-12-31 0001386716 sblk:StarElectra1Member 2023-01-01 2023-12-31 0001386716 sblk:StarAngelinaMember 2023-01-01 2023-12-31 0001386716 sblk:StarGwynethMember 2023-01-01 2023-12-31 0001386716 sblk:StarKamilaMember 2023-01-01 2023-12-31 0001386716 sblk:StarLuna1Member 2023-01-01 2023-12-31 0001386716 sblk:StarBianca1Member 2023-01-01 2023-12-31 0001386716 sblk:PendulumIMember 2023-01-01 2023-12-31 0001386716 sblk:StarMariaMember 2023-01-01 2023-12-31 0001386716 sblk:StarMarkellaMember 2023-01-01 2023-12-31 0001386716 sblk:StarDanaiMember 2023-01-01 2023-12-31 0001386716 sblk:StarJeanetteMember 2023-01-01 2023-12-31 0001386716 sblk:StarElizabethMember 2023-01-01 2023-12-31 0001386716 sblk:StarGeorgiaMember 2023-01-01 2023-12-31 0001386716 sblk:StarSophiaMember 2023-01-01 2023-12-31 0001386716 sblk:StarMariellaMember 2023-01-01 2023-12-31 0001386716 sblk:StarMoiraMember 2023-01-01 2023-12-31 0001386716 sblk:StarReneeMember 2023-01-01 2023-12-31 0001386716 sblk:StarNasiaMember 2023-01-01 2023-12-31 0001386716 sblk:StarLauraMember 2023-01-01 2023-12-31 0001386716 sblk:StarMonaMember 2023-01-01 2023-12-31 0001386716 sblk:StarHelenaMember 2023-01-01 2023-12-31 0001386716 sblk:StarNinaMember 2023-01-01 2023-12-31 0001386716 sblk:StarAstridMember 2023-01-01 2023-12-31 0001386716 sblk:StarAlessiaMember 2023-01-01 2023-12-31 0001386716 sblk:StarCalypsoMember 2023-01-01 2023-12-31 0001386716 sblk:StarSuzannaMember 2023-01-01 2023-12-31 0001386716 sblk:StarCharisMember 2023-01-01 2023-12-31 0001386716 sblk:MercurialVirgoIMember 2023-01-01 2023-12-31 0001386716 sblk:StardustMember 2023-01-01 2023-12-31 0001386716 sblk:StarSkyMember 2023-01-01 2023-12-31 0001386716 sblk:StarLambadaMember 2023-01-01 2023-12-31 0001386716 sblk:StarCariocaMember 2023-01-01 2023-12-31 0001386716 sblk:StarCapoeiraMember 2023-01-01 2023-12-31 0001386716 sblk:StarMacarenaMember 2023-01-01 2023-12-31 0001386716 sblk:StarLydiaMember 2023-01-01 2023-12-31 0001386716 sblk:StarNicoleMember 2023-01-01 2023-12-31 0001386716 sblk:StarVirginiaMember 2023-01-01 2023-12-31 0001386716 sblk:StarGenesisMember 2023-01-01 2023-12-31 0001386716 sblk:StarFlameMember 2023-01-01 2023-12-31 0001386716 sblk:StarIrisMember 2023-01-01 2023-12-31 0001386716 sblk:StarEmilyMember 2023-01-01 2023-12-31 0001386716 sblk:IdeeFixeMember 2023-01-01 2023-12-31 0001386716 sblk:RobertaMember 2023-01-01 2023-12-31 0001386716 sblk:LauraMember 2023-01-01 2023-12-31 0001386716 sblk:KaleyMember 2023-01-01 2023-12-31 0001386716 sblk:KennadiMember 2023-01-01 2023-12-31 0001386716 sblk:MackenzieMember 2023-01-01 2023-12-31 0001386716 sblk:StarApusMember 2023-01-01 2023-12-31 0001386716 sblk:StarBovariusMember 2023-01-01 2023-12-31 0001386716 sblk:StarSubaruMember 2023-01-01 2023-12-31 0001386716 sblk:StarWaveMember 2023-01-01 2023-12-31 0001386716 sblk:StarChallengerMember 2023-01-01 2023-12-31 0001386716 sblk:StarFighterMember 2023-01-01 2023-12-31 0001386716 sblk:StarLutasMember 2023-01-01 2023-12-31 0001386716 sblk:HoneyBadgerMember 2023-01-01 2023-12-31 0001386716 sblk:WolverineMember 2023-01-01 2023-12-31 0001386716 sblk:StarAntaresMember 2023-01-01 2023-12-31 0001386716 sblk:StarMonicaMember 2023-01-01 2023-12-31 0001386716 sblk:StarAquariusMember 2023-01-01 2023-12-31 0001386716 sblk:StarPiscesMember 2023-01-01 2023-12-31 0001386716 sblk:StarGloryMember 2023-01-01 2023-12-31 0001386716 sblk:StarPyxisMember 2023-01-01 2023-12-31 0001386716 sblk:StarHydrusMember 2023-01-01 2023-12-31 0001386716 sblk:StarCleoMember 2023-01-01 2023-12-31 0001386716 sblk:DivaMember 2023-01-01 2023-12-31 0001386716 sblk:StarPegasusMember 2023-01-01 2023-12-31 0001386716 sblk:StarDoradoMember 2023-01-01 2023-12-31 0001386716 sblk:StrangeAttractorIMember 2023-01-01 2023-12-31 0001386716 sblk:StarBrightMember 2023-01-01 2023-12-31 0001386716 sblk:StarOmicronMember 2023-01-01 2023-12-31 0001386716 sblk:VesselsInOperationIIMember 2023-01-01 2023-12-31 0001386716 sblk:StarThunderaLLCMember 2023-01-01 2023-12-31 0001386716 sblk:StarCalderaLLCMember 2023-01-01 2023-12-31 0001386716 sblk:StarTeraLLCMember 2023-01-01 2023-12-31 0001386716 sblk:StarNovaLLCMember 2023-01-01 2023-12-31 0001386716 sblk:StarAffinityLLCMember 2023-01-01 2023-12-31 0001386716 sblk:VesselsUnderConstructionIMember 2023-01-01 2023-12-31 0001386716 sblk:StarShibumiMember 2023-01-01 2023-12-31 0001386716 sblk:NBKamsarmax1Member 2023-01-01 2023-12-31 0001386716 sblk:NBKamsarmax2Member 2023-01-01 2023-12-31 0001386716 sblk:NBKamsarmax3Member 2023-01-01 2023-12-31 0001386716 sblk:NBKamsarmax4Member 2023-01-01 2023-12-31 0001386716 sblk:NBUltramax1Member 2023-01-01 2023-12-31 0001386716 sblk:NBUltramax2Member 2023-01-01 2023-12-31 0001386716 sblk:TimeCharterInNewbuildingVesselsMember 2023-01-01 2023-12-31 0001386716 sblk:ChangeInAccountingEstimateMember 2023-01-01 2023-12-31 0001386716 sblk:InterchartShippingMember 2022-12-31 0001386716 sblk:InterchartShippingMember 2023-12-31 0001386716 sblk:StarOceanManningPhilipinesIncMember 2022-12-31 0001386716 sblk:StarOceanManningPhilipinesIncMember 2023-12-31 0001386716 sblk:CCLPoolMember 2022-12-31 0001386716 sblk:CCLPoolMember 2023-12-31 0001386716 sblk:OceanbulkMaritimeMember 2022-12-31 0001386716 sblk:OceanbulkMaritimeMember 2023-12-31 0001386716 sblk:ManagementAndDirectorsFeesMember 2022-12-31 0001386716 sblk:ManagementAndDirectorsFeesMember 2023-12-31 0001386716 sblk:IbleaShipManagementLimitedMember 2022-12-31 0001386716 sblk:IbleaShipManagementLimitedMember 2023-12-31 0001386716 sblk:InterchartShippingMember 2021-01-01 2021-12-31 0001386716 sblk:InterchartShippingMember 2022-01-01 2022-12-31 0001386716 sblk:InterchartShippingMember 2023-01-01 2023-12-31 0001386716 sblk:ManagementAndDirectorsFeesMember 2021-01-01 2021-12-31 0001386716 sblk:ManagementAndDirectorsFeesMember 2022-01-01 2022-12-31 0001386716 sblk:ManagementAndDirectorsFeesMember 2023-01-01 2023-12-31 0001386716 sblk:CombineMarineLtdAndAlmaMember 2021-01-01 2021-12-31 0001386716 sblk:CombineMarineLtdAndAlmaMember 2022-01-01 2022-12-31 0001386716 sblk:CombineMarineLtdAndAlmaMember 2023-01-01 2023-12-31 0001386716 sblk:OceanbulkMaritimeMember 2021-01-01 2021-12-31 0001386716 sblk:OceanbulkMaritimeMember 2022-01-01 2022-12-31 0001386716 sblk:OceanbulkMaritimeMember 2023-01-01 2023-12-31 0001386716 sblk:AugusteaTechnoservicesLtdMember 2021-01-01 2021-12-31 0001386716 sblk:AugusteaTechnoservicesLtdMember 2022-01-01 2022-12-31 0001386716 sblk:AugusteaTechnoservicesLtdMember 2023-01-01 2023-12-31 0001386716 sblk:IbleaShipManagementLimitedMember 2021-01-01 2021-12-31 0001386716 sblk:IbleaShipManagementLimitedMember 2022-01-01 2022-12-31 0001386716 sblk:IbleaShipManagementLimitedMember 2023-01-01 2023-12-31 0001386716 sblk:AOMMember 2021-01-01 2021-12-31 0001386716 sblk:AOMMember 2022-01-01 2022-12-31 0001386716 sblk:AOMMember 2023-01-01 2023-12-31 0001386716 sblk:StarOceanManningPhilipinesIncMember 2021-01-01 2021-12-31 0001386716 sblk:StarOceanManningPhilipinesIncMember 2022-01-01 2022-12-31 0001386716 sblk:StarOceanManningPhilipinesIncMember 2023-01-01 2023-12-31 0001386716 sblk:InterchartShippingMember 2014-12-31 0001386716 sblk:InterchartShippingMember 2020-01-01 2020-12-31 0001386716 sblk:InterchartShippingMember 2019-01-01 2019-12-31 0001386716 sblk:InterchartShippingMember 2023-01-01 2023-12-31 0001386716 sblk:ManagementAndDirectorsFees1Member 2023-01-01 2023-12-31 0001386716 sblk:ManagementAndDirectorsFees1Member sblk:NonEmployeeDirectorsMember 2023-01-01 2023-12-31 0001386716 sblk:ManagementAndDirectorsFees1Member sblk:ChairmanForAuditCommitteeMember 2023-01-01 2023-12-31 0001386716 sblk:ManagementAndDirectorsFees1Member sblk:EachMemberForAuditCommitteeMember 2023-01-01 2023-12-31 0001386716 sblk:ManagementAndDirectorsFees1Member sblk:AttendanceOfMeetingsMember 2023-01-01 2023-12-31 0001386716 sblk:CombineMarineLtdMember 2023-01-01 2023-12-31 0001386716 currency:EUR 2023-12-31 0001386716 sblk:AlmaPropertiesMember 2023-01-01 2023-12-31 0001386716 sblk:OaktreeMember sblk:OaktreeShareholderAgreementMember sblk:BeneficialOwnershipOf40OrMoreMember 2023-01-01 2023-12-31 0001386716 sblk:OaktreeMember sblk:OaktreeShareholderAgreementMember 2023-01-01 2023-12-31 0001386716 sblk:OaktreeMember sblk:OaktreeShareholderAgreementMember sblk:BeneficialOwnershipOf25OrMoreButLessThan40Member 2023-01-01 2023-12-31 0001386716 sblk:OaktreeMember sblk:OaktreeShareholderAgreementMember sblk:BeneficialOwnershipOf15OrMoreButLessThan25Member 2023-01-01 2023-12-31 0001386716 sblk:OaktreeMember sblk:OaktreeShareholderAgreementMember sblk:BeneficialOwnershipOf5OrMoreButLessThan15Member 2023-01-01 2023-12-31 0001386716 sblk:CommonStockIMember sblk:OaktreeShareRepurchaseMember 2023-12-31 0001386716 sblk:OaktreeMember 2023-01-01 2023-12-31 0001386716 sblk:AugusteaVesselsMember 2018-08-03 0001386716 sblk:AugusteaVesselsMember 2018-01-01 2018-08-03 0001386716 sblk:StarOceanManningPhilipinesIncMember 2023-12-31 0001386716 sblk:HeldByLocalEntrepreneursMember sblk:StarOceanManningPhilipinesIncMember 2023-12-31 0001386716 sblk:CCLPoolMember 2023-12-31 0001386716 sblk:CCLPoolMember 2020-12-30 0001386716 sblk:VesselCostMember 2021-12-31 0001386716 sblk:AccumulatedDepreciationMember 2021-12-31 0001386716 sblk:NetBookValueMember 2021-12-31 0001386716 sblk:VesselCostMember 2022-01-01 2022-12-31 0001386716 sblk:AccumulatedDepreciationMember 2022-01-01 2022-12-31 0001386716 sblk:NetBookValueMember 2022-01-01 2022-12-31 0001386716 sblk:VesselCostMember 2022-12-31 0001386716 sblk:AccumulatedDepreciationMember 2022-12-31 0001386716 sblk:NetBookValueMember 2022-12-31 0001386716 sblk:VesselCostMember 2023-01-01 2023-12-31 0001386716 sblk:AccumulatedDepreciationMember 2023-01-01 2023-12-31 0001386716 sblk:NetBookValueMember 2023-01-01 2023-12-31 0001386716 sblk:VesselCostMember 2023-12-31 0001386716 sblk:AccumulatedDepreciationMember 2023-12-31 0001386716 sblk:NetBookValueMember 2023-12-31 0001386716 sblk:FirstPriorityMortgageMember 2023-12-31 0001386716 us-gaap:LeaseAgreementsMember 2023-12-31 0001386716 sblk:SecondPriorityMortgageMember 2023-12-31 0001386716 sblk:FiveKamsarmaxNewbuildingVesselsMember 2023-12-31 0001386716 sblk:FirstTwoKamsarmaxNewbuildingVesselsMember 2023-01-01 2023-12-31 0001386716 sblk:NextTwoKamsarmaxNewbuildingVesselsMember 2023-01-01 2023-12-31 0001386716 sblk:LastKamsarmaxNewbuildingVesselMember 2023-01-01 2023-12-31 0001386716 sblk:StarPavlinaConstructiveTotalLossMember 2023-01-01 2023-12-31 0001386716 sblk:StarPavlinaWarRiskInsuranceMember 2023-01-01 2023-12-31 0001386716 sblk:ElevenOfFifteenCompanysVesselsToBeSoldMember 2023-01-01 2023-12-31 0001386716 sblk:TwoOfFifteenCompanysVesselsToBeSoldMember 2023-01-01 2023-12-31 0001386716 sblk:OneOfFifteenCompanysVesselsToBeSoldMember 2023-01-01 2023-12-31 0001386716 sblk:RemainingTwoOfFifteenCompanysVesselsToBeSoldMember 2023-01-01 2023-12-31 0001386716 sblk:SaleOfFifteenVesselsMember 2023-01-01 2023-12-31 0001386716 sblk:CharterInVesselsMember 2022-12-31 0001386716 sblk:CharterInVesselsMember 2023-12-31 0001386716 sblk:OfficeRentalMember 2022-12-31 0001386716 sblk:OfficeRentalMember 2023-12-31 0001386716 sblk:OfficeRentalMember 2021-01-01 2021-12-31 0001386716 sblk:OfficeRentalMember 2022-01-01 2022-12-31 0001386716 sblk:OfficeRentalMember 2023-01-01 2023-12-31 0001386716 sblk:TimeCharterInVesselsMember 2023-12-31 0001386716 sblk:SKShipholdingS.A.Member sblk:StarLutasMember 2023-01-01 2023-12-31 0001386716 sblk:SKShipholdingS.A.Member sblk:StarLutasMember 2020-01-01 2020-09-18 0001386716 sblk:SPDBFinancialLeasingLtdMember sblk:MackenzieKennadiHoneyBadgerWolveringAndStarAntaresMember 2023-01-01 2023-12-31 0001386716 sblk:SPDBFinancialLeasingLtdMember sblk:MackenzieKennadiHoneyBadgerWolveringAndStarAntaresMember 2020-01-01 2020-09-30 0001386716 sblk:ICBCFinancialLeasingCo.LtdMember sblk:GargantuaGoliathAndMaharajMember 2023-01-01 2023-12-31 0001386716 sblk:ICBCFinancialLeasingCo.LtdMember sblk:GargantuaGoliathAndMaharajMember 2020-01-01 2020-09-29 0001386716 sblk:StarPiscesMember sblk:SKShipholdingS.A.Member 2023-01-01 2023-12-31 0001386716 sblk:StarPiscesMember sblk:SKShipholdingS.A.Member 2019-01-01 2019-04-30 0001386716 sblk:StarChallengerMember sblk:KyowaSanshoCo.Ltd.Member 2023-01-01 2023-12-31 0001386716 sblk:StarChallengerMember sblk:KyowaSanshoCo.Ltd.Member 2019-01-01 2019-07-10 0001386716 sblk:StarFighterMember sblk:KyowaSanshoCo.Ltd.1Member 2023-01-01 2023-12-31 0001386716 sblk:StarFighterMember sblk:KyowaSanshoCo.Ltd.1Member 2018-01-01 2018-12-31 0001386716 sblk:FinancingLeaseMember 2023-12-31 0001386716 sblk:SEB30kFacilityMember 2023-01-01 2023-05-30 0001386716 sblk:SEB30kFacilityMember 2023-01-01 2023-05-25 0001386716 sblk:SEB30kFacilityMember 2023-05-25 0001386716 sblk:Nordea50kFacilityMember 2023-01-01 2023-07-12 0001386716 sblk:Nordea50kFacilityMember 2023-01-01 2023-07-10 0001386716 sblk:Nordea50kFacilityMember 2023-07-10 0001386716 sblk:Nordea50kFacilityMember sblk:TrancheAMember 2023-01-01 2023-07-10 0001386716 sblk:Nordea50kFacilityMember sblk:TrancheBMember 2023-01-01 2023-07-10 0001386716 sblk:Nordea50kFacilityMember sblk:TrancheAMember 2023-07-10 0001386716 sblk:Nordea50kFacilityMember sblk:TrancheBMember 2023-07-10 0001386716 sblk:ESUN140KMember 2023-01-01 2023-10-04 0001386716 sblk:ESUN140KMember 2023-01-01 2023-09-26 0001386716 sblk:ESUN140KMember 2023-09-26 0001386716 sblk:INGFacilityAmendedMember 2023-01-01 2023-09-20 0001386716 sblk:INGFacilityAmendedMember 2023-01-01 2023-09-30 0001386716 sblk:INGFacilityAmendedMember 2023-09-20 0001386716 sblk:INGFacilityAmendedIMember 2023-01-01 2023-11-23 0001386716 sblk:INGFacilityAmendedIMember 2023-12-31 0001386716 sblk:PeloreusAndLeviathanMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-12-31 0001386716 sblk:PeloreusAndLeviathanMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2018-01-01 2018-10-31 0001386716 sblk:PeloreusAndLeviathanMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-01-01 2023-12-31 0001386716 sblk:PeloreusAndLeviathanMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheCAndDMember 2023-12-31 0001386716 sblk:PeloreusAndLeviathanMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheCAndDMember 2019-01-01 2019-07-31 0001386716 sblk:PeloreusAndLeviathanMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheCAndDMember 2023-01-01 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAMember 2019-01-01 2019-03-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheBMember 2019-01-01 2019-04-30 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-01-01 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAMember 2023-01-01 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheBMember 2023-01-01 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAMember 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheBMember 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheCAndDMember 2023-12-31 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheCAndDMember 2019-01-01 2019-11-30 0001386716 sblk:StarMagnanimusAndStarAlessiaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheCAndDMember 2023-01-01 2023-12-31 0001386716 sblk:StarClaudineStarOpheliaStarLyraStarBiancaStarFlameStarMonaMember sblk:AmendedAndRestastedINGBankNV210600Member 2023-12-31 0001386716 sblk:StarClaudineStarOpheliaStarLyraStarBiancaStarFlameStarMonaMember sblk:AmendedAndRestastedINGBankNV210600Member 2020-01-01 2020-07-31 0001386716 sblk:StarClaudineStarOpheliaStarLyraStarBiancaStarFlameStarMonaMember sblk:AmendedAndRestastedINGBankNV210600Member 2023-01-01 2023-12-31 0001386716 sblk:StarElizabethStarPavlinaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-12-31 0001386716 sblk:StarElizabethStarPavlinaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2021-01-01 2021-08-31 0001386716 sblk:StarElizabethStarPavlinaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-01-01 2023-12-31 0001386716 sblk:StarElizabethStarPavlinaMember sblk:AmendedAndRestastedINGBankNV210600Member sblk:TrancheAandBMember 2023-03-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member 2023-12-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member srt:MinimumMember 2022-01-01 2022-06-30 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member srt:MaximumMember 2022-01-01 2022-06-30 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member 2023-01-01 2023-12-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member srt:MinimumMember 2023-01-01 2023-12-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member srt:MaximumMember 2023-01-01 2023-12-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member srt:MinimumMember 2023-12-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member srt:MaximumMember 2023-12-31 0001386716 sblk:MadredeusStarVegaEnetiMember sblk:AmendedAndRestastedINGBankNV210600Member 2023-11-30 0001386716 sblk:AmendedAndRestastedINGBankNV210600Member 2023-01-01 2023-12-31 0001386716 sblk:CTBC50kFacilityMember 2023-01-01 2023-11-29 0001386716 sblk:CTBC50kFacilityMember 2023-01-01 2023-11-23 0001386716 sblk:CTBC50kFacilityMember 2023-11-23 0001386716 sblk:CTBC50kFacilityMember sblk:TrancheAMember 2023-11-23 0001386716 sblk:CTBC50kFacilityMember sblk:TrancheBMember 2023-11-23 0001386716 sblk:CTBC50kFacilityMember sblk:TrancheAMember 2023-01-01 2023-11-23 0001386716 sblk:CTBC50kFacilityMember sblk:TrancheBMember 2023-01-01 2023-11-23 0001386716 sblk:NBGFacility2Member 2023-01-01 2023-11-28 0001386716 sblk:NBGFacility2Member 2023-11-28 0001386716 sblk:NBGFacility2Member sblk:FirstFourInstallmentsMember 2023-01-01 2023-11-28 0001386716 sblk:NBGFacility2Member sblk:RemainingEightInstallmentsMember 2023-01-01 2023-11-28 0001386716 sblk:Citi100kFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:Citi100kFacilityMember 2023-12-31 0001386716 sblk:Citi100kFacilityMember sblk:TrancheAMember 2022-01-01 2022-07-18 0001386716 sblk:Citi100kFacilityMember sblk:TrancheAMember 2023-01-01 2023-12-31 0001386716 sblk:Citi100kFacilityMember sblk:TrancheBMember 2022-01-01 2022-08-29 0001386716 sblk:Citi100kFacilityMember sblk:TrancheBMember 2023-01-01 2023-12-31 0001386716 sblk:Citi100kFacilityMember sblk:TrancheAMember 2023-12-31 0001386716 sblk:Citi100kFacilityMember 2023-06-30 0001386716 sblk:Citi100kFacilityMember sblk:TrancheBIMember 2023-01-01 2023-12-31 0001386716 sblk:Citi100kFacilityMember sblk:TrancheBIMember 2023-12-31 0001386716 sblk:SEB42kFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:SEB42kFacilityMember 2023-12-31 0001386716 sblk:SEB42kFacilityMember sblk:TrancheAMember 2022-01-01 2022-08-03 0001386716 sblk:SEB42kFacilityMember sblk:TrancheBMember 2022-01-01 2022-08-03 0001386716 sblk:SEB42kFacilityMember sblk:TrancheAandBMember 2023-01-01 2023-12-31 0001386716 sblk:SEB42kFacilityMember sblk:TrancheCMember 2022-01-01 2022-08-03 0001386716 sblk:SEB42kFacilityMember sblk:TrancheCMember 2023-01-01 2023-12-31 0001386716 sblk:SEB42kFacilityMember srt:MinimumMember 2023-01-01 2023-12-31 0001386716 sblk:SEB42kFacilityMember srt:MaximumMember 2023-01-01 2023-12-31 0001386716 sblk:SEB42kFacilityMember srt:MinimumMember 2023-12-31 0001386716 sblk:SEB42kFacilityMember srt:MaximumMember 2023-12-31 0001386716 sblk:CTBC25KFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:CTBC25KFacilityMember 2022-01-01 2022-11-30 0001386716 sblk:CTBC25KFacilityMember 2023-12-31 0001386716 sblk:NTT24KFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:NTT24KFacilityMember 2022-01-01 2022-12-16 0001386716 sblk:NTT24KFacilityMember 2023-12-31 0001386716 sblk:ABNAMRO24KFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:ABNAMRO24KFacilityMember 2022-01-01 2022-12-22 0001386716 sblk:ABNAMRO24KFacilityMember 2023-12-31 0001386716 sblk:StandardChartered47kFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:StandardChartered47kFacilityMember 2023-12-31 0001386716 sblk:StandardChartered47kFacilityMember sblk:TrancheAMember 2023-01-01 2023-01-31 0001386716 sblk:StandardChartered47kFacilityMember sblk:TrancheBMember 2023-01-01 2023-01-31 0001386716 sblk:StandardChartered47kFacilityMember sblk:TrancheAMember 2023-01-01 2023-12-31 0001386716 sblk:StandardChartered47kFacilityMember sblk:TrancheBMember 2023-01-01 2023-12-31 0001386716 sblk:StandardChartered47kFacilityMember sblk:TrancheAMember 2023-12-31 0001386716 sblk:StandardChartered47kFacilityMember sblk:TrancheBMember 2023-12-31 0001386716 sblk:SEB39000FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:SEB39000FacilityMember 2021-01-01 2021-01-25 0001386716 sblk:SEB39000FacilityMember 2023-12-31 0001386716 sblk:NBG125000FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:NBG125000FacilityMember 2021-01-01 2021-06-28 0001386716 sblk:NBG125000FacilityMember 2022-09-30 0001386716 sblk:NBG125000FacilityMember 2023-11-30 0001386716 sblk:DNB107500FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:DNB107500FacilityMember 2021-01-01 2021-09-29 0001386716 sblk:DNB107500FacilityMember 2023-12-31 0001386716 sblk:DNB107500FacilityMember sblk:StarBorealisAndStarPolarisMember 2023-12-31 0001386716 sblk:DNB107500FacilityMember sblk:StarGloryMember 2023-12-31 0001386716 sblk:AmendedInstallmentsMember sblk:DNB107500FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:DNB107500FacilityMember sblk:AmendedInstallmentsMember 2023-12-31 0001386716 sblk:ABNAMRO97150Member 2023-01-01 2023-12-31 0001386716 sblk:ABNAMRO97150Member 2023-12-31 0001386716 sblk:ABNAMRO97150Member sblk:TrancheAMember 2021-01-01 2021-10-29 0001386716 sblk:ABNAMRO97150Member sblk:TrancheAMember 2023-12-31 0001386716 sblk:ABNAMRO97150Member sblk:TrancheAMember 2023-01-01 2023-12-31 0001386716 sblk:ABNAMRO97150Member sblk:TrancheBMember 2021-01-01 2021-10-29 0001386716 sblk:ABNAMRO97150Member sblk:TrancheBMember 2023-12-31 0001386716 sblk:ABNAMRO97150Member sblk:TrancheBMember 2023-01-01 2023-12-31 0001386716 sblk:CreditAgricole62000FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:CreditAgricole62000FacilityMember 2021-01-01 2021-11-02 0001386716 sblk:CreditAgricole62000FacilityMember 2023-12-31 0001386716 sblk:CreditAgricole62000FacilityMember sblk:FirstThreeInstallmentsMember 2023-01-01 2023-12-31 0001386716 sblk:CreditAgricole62000FacilityMember sblk:Remaining17InstallmentsMember 2023-01-01 2023-12-31 0001386716 sblk:DSF55000FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:DSF55000FacilityMember 2023-12-31 0001386716 sblk:DSF55000FacilityMember 2020-01-01 2020-03-30 0001386716 sblk:CEXIM57564Member 2023-01-01 2023-12-31 0001386716 sblk:CEXIM57564Member 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarWaveMember 2020-01-01 2020-12-31 0001386716 sblk:CEXIM57564Member sblk:StarGinaMember 2020-01-01 2020-12-31 0001386716 sblk:CEXIM57564Member sblk:StarWaveStarGinaMember 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarWaveStarGinaMember 2023-01-01 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarWaveMember 2023-01-01 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarGinaMember 2023-01-01 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarWaveMember 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarGinaMember 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarCharisMember 2020-01-01 2020-12-31 0001386716 sblk:CEXIM57564Member sblk:StarSuzannaMember 2020-01-01 2020-12-31 0001386716 sblk:CEXIM57564Member sblk:StarCharisStarSuzannaMember 2023-12-31 0001386716 sblk:CEXIM57564Member sblk:StarCharisStarSuzannaMember 2023-01-01 2023-12-31 0001386716 sblk:ESUNFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:ESUNFacilityMember 2019-01-01 2019-03-01 0001386716 sblk:AtradiusFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:AtradiusFacilityMember sblk:FirstThreeTranchesMember 2019-01-01 2019-12-31 0001386716 sblk:AtradiusFacilityMember sblk:LastTrancheMember 2020-01-01 2020-01-30 0001386716 sblk:AtradiusFacilityMember 2023-12-31 0001386716 sblk:CTBCFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:CTBCFacilityMember 2019-01-01 2019-05-31 0001386716 sblk:NTTFacilityMember 2023-01-01 2023-12-31 0001386716 sblk:NTTFacilityMember 2019-01-01 2019-08-31 0001386716 sblk:CEXIM106470FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:CEXIM106470FacilityMember 2023-12-31 0001386716 sblk:CEXIM106470FacilityMember sblk:TrancheABCMember 2019-01-01 2019-11-30 0001386716 sblk:ABN115000FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheAMember 2018-01-01 2018-12-20 0001386716 sblk:ABN115000FacilityMember sblk:TrancheBMember 2018-01-01 2018-12-20 0001386716 sblk:ABN115000FacilityMember sblk:TrancheAMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheBMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheAandBMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheAandBMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheAMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheBMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheCAndDMember 2019-01-01 2019-01-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheCAndDMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:TrancheCAndDMember 2023-12-31 0001386716 sblk:ABN67897FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheAMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheAMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheAFirst13InstalmentsMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheAFourteenthInstalmentMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheANextFiveInstalmentsMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheALastInstalmentMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheBMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheBMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheBLastInstalmentMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheCAndDMember 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheCAndDMember 2023-01-01 2023-12-31 0001386716 sblk:ABN115000FacilityMember sblk:AmendedAndRestatedAgreementABN115000FacilityMember sblk:TrancheCandDLastInstalmentMember 2023-01-01 2023-12-31 0001386716 sblk:NotLegallyRestrictedMember 2022-12-31 0001386716 sblk:NotLegallyRestrictedMember 2023-12-31 0001386716 sblk:RestrictedCashCashEquivalentsMember 2022-12-31 0001386716 sblk:RestrictedCashCashEquivalentsMember 2023-12-31 0001386716 us-gaap:LongTermDebtMember 2021-01-01 2021-12-31 0001386716 us-gaap:LongTermDebtMember 2022-01-01 2022-12-31 0001386716 us-gaap:LongTermDebtMember 2023-01-01 2023-12-31 0001386716 us-gaap:PreferredStockMember srt:MaximumMember 2023-12-31 0001386716 sblk:CommonStockIMember srt:MaximumMember 2023-12-31 0001386716 sblk:CommonStockIMember 2023-12-31 0001386716 sblk:ShareRepurchaseProgramMember srt:MaximumMember 2021-08-05 0001386716 sblk:ShareRepurchaseProgramMember 2023-05-16 0001386716 sblk:NewShareRepurchaseProgramMember srt:MaximumMember 2023-05-16 0001386716 sblk:ShareRepurchaseProgramMember sblk:OpenMarketTransactionsMember 2021-01-01 2021-12-31 0001386716 sblk:ShareRepurchaseProgramMember sblk:OpenMarketTransactionsMember 2022-01-01 2022-12-31 0001386716 sblk:ShareRepurchaseProgramMember sblk:OpenMarketTransactionsMember 2023-01-01 2023-12-31 0001386716 sblk:ERAcquisitionVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:EnetiAcquisitionVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:CommonStockIMember 2021-01-01 2021-12-31 0001386716 sblk:SalesAgentsMember 2021-07-01 0001386716 sblk:SalesAgentsMember 2021-01-01 2021-07-01 0001386716 sblk:MarketEquityProgramsMember 2022-01-01 2022-12-31 0001386716 sblk:MarketEquityProgramsMember 2023-01-01 2023-12-31 0001386716 sblk:MarketEquityProgramsMember 2021-01-01 2021-12-31 0001386716 sblk:CommonStockIMember sblk:FirstOaktreeShareRepurchaseMember 2023-01-01 2023-09-21 0001386716 sblk:CommonStockIMember sblk:SecondOaktreeShareRepurchaseMember 2023-01-01 2023-10-30 0001386716 sblk:CommonStockIMember 2022-01-01 2022-12-31 0001386716 sblk:CommonStockIMember 2023-01-01 2023-12-31 0001386716 srt:MinimumMember sblk:ScrubberIncentiveProgramMember 2023-01-01 2023-12-31 0001386716 srt:MaximumMember sblk:ScrubberIncentiveProgramMember 2023-01-01 2023-12-31 0001386716 srt:MinimumMember sblk:FirstYearMember 2021-01-01 2021-12-31 0001386716 srt:MinimumMember sblk:SecondYearMember 2022-01-01 2022-12-31 0001386716 srt:MinimumMember sblk:ThirdYearMember 2023-01-01 2023-12-31 0001386716 srt:MaximumMember sblk:FirstYearMember 2021-01-01 2021-12-31 0001386716 srt:MaximumMember sblk:SecondYearMember 2022-01-01 2022-12-31 0001386716 srt:MaximumMember sblk:ThirdYearMember 2023-01-01 2023-12-31 0001386716 sblk:AwardedtokeyemployeesMember 2022-12-31 0001386716 sblk:AwardedtokeyemployeesMember 2023-12-31 0001386716 sblk:EquityIncentivePlan2021Member 2021-06-07 0001386716 sblk:EquityIncentivePlan2021Member 2021-01-01 2021-06-07 0001386716 sblk:EquityIncentivePlan2021Member 2021-01-01 2021-09-30 0001386716 sblk:EquityIncentivePlan2021Member 2022-01-01 2022-06-30 0001386716 sblk:EquityIncentivePlan2021Member sblk:VestInJune2024Member 2021-06-07 0001386716 sblk:EquityIncentivePlan20221Member 2022-04-11 0001386716 sblk:EquityIncentivePlan20221Member 2022-01-01 2022-04-11 0001386716 sblk:EquityIncentivePlan20221Member 2022-01-01 2022-10-31 0001386716 sblk:EquityIncentivePlan20221Member 2023-01-01 2023-04-30 0001386716 sblk:EquityIncentivePlan20221Member sblk:VestInApril2025Member 2022-04-11 0001386716 sblk:EquityIncentivePlan2023Member 2023-05-16 0001386716 sblk:EquityIncentivePlan2023Member 2023-01-01 2023-05-16 0001386716 sblk:EquityIncentivePlan2023Member 2023-01-01 2023-11-30 0001386716 sblk:EquityIncentivePlan2023Member sblk:VestInMay2024Member 2023-05-16 0001386716 sblk:EquityIncentivePlan2023Member sblk:VestInMay2026Member 2023-05-16 0001386716 sblk:FutureMinimumNonCancellableCharterRevenueMember us-gaap:LeaseAgreementsMember 2023-12-31 0001386716 us-gaap:LeaseAgreementsMember 2023-12-31 0001386716 sblk:CharterInExpenseNewbuildingVesselsMember us-gaap:CommitmentsMember 2023-12-31 0001386716 sblk:BWTSMember us-gaap:CommitmentsMember 2023-12-31 0001386716 sblk:NewbuildingVesselsIMember us-gaap:CommitmentsMember 2023-12-31 0001386716 us-gaap:CommitmentsMember 2023-12-31 0001386716 sblk:TimeCharterMember 2021-01-01 2021-12-31 0001386716 sblk:TimeCharterMember 2022-01-01 2022-12-31 0001386716 sblk:TimeCharterMember 2023-01-01 2023-12-31 0001386716 sblk:VoyageContractsMember 2021-01-01 2021-12-31 0001386716 sblk:VoyageContractsMember 2022-01-01 2022-12-31 0001386716 sblk:VoyageContractsMember 2023-01-01 2023-12-31 0001386716 sblk:PoolingArrangementsMember 2021-01-01 2021-12-31 0001386716 sblk:PoolingArrangementsMember 2022-01-01 2022-12-31 0001386716 sblk:PoolingArrangementsMember 2023-01-01 2023-12-31 0001386716 sblk:VoyageCharterAgreementsMember 2023-12-31 0001386716 sblk:VoyageCharterAgreementsMember 2022-12-31 0001386716 sblk:VoyageCharterAgreementsMember 2023-01-01 2023-12-31 0001386716 sblk:RevenueContractsMember 2023-12-31 0001386716 sblk:RevenueContractsMember 2022-12-31 0001386716 sblk:ScrubberFittedVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:ScrubberFittedVesselsMember 2022-01-01 2022-12-31 0001386716 sblk:ScrubberFittedVesselsMember 2023-01-01 2023-12-31 0001386716 sblk:VesselsOperatingInCCLPoolMember 2021-01-01 2021-12-31 0001386716 sblk:VesselsOperatingInCCLPoolMember 2022-01-01 2022-12-31 0001386716 sblk:VesselsOperatingInCCLPoolMember 2023-01-01 2023-12-31 0001386716 sblk:VesselsOperatingInShortPoolMember 2021-01-01 2021-12-31 0001386716 sblk:VesselsOperatingInShortPoolMember 2022-01-01 2022-12-31 0001386716 sblk:VesselsOperatingInShortPoolMember 2023-01-01 2023-12-31 0001386716 sblk:VesselsOperatingWithOtherPartiesMember 2021-01-01 2021-12-31 0001386716 sblk:VesselsOperatingWithOtherPartiesMember 2022-01-01 2022-12-31 0001386716 sblk:VesselsOperatingWithOtherPartiesMember 2023-01-01 2023-12-31 0001386716 sblk:CharterInVesselsMember 2021-01-01 2021-12-31 0001386716 sblk:CharterInVesselsMember 2022-01-01 2022-12-31 0001386716 sblk:CharterInVesselsMember 2023-01-01 2023-12-31 0001386716 sblk:INGMember 2023-01-01 2023-12-31 0001386716 sblk:INGMember 2023-12-31 0001386716 sblk:INGMember sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:INGMember sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:INGBankNV2Member 2023-01-01 2023-12-31 0001386716 sblk:INGBankNV2Member 2023-12-31 0001386716 sblk:INGBankNV2Member sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:INGBankNV2Member sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB1Member 2023-01-01 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB1Member 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB1Member sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB1Member sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:CitibankEurope1PLCMember 2023-01-01 2023-12-31 0001386716 sblk:CitibankEurope1PLCMember 2023-12-31 0001386716 sblk:CitibankEurope1PLCMember sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:CitibankEurope1PLCMember sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:CitibankEurope2PLCMember 2023-01-01 2023-12-31 0001386716 sblk:CitibankEurope2PLCMember 2023-12-31 0001386716 sblk:CitibankEurope2PLCMember sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:CitibankEurope2PLCMember sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:CitibankEurope3PLCMember 2023-01-01 2023-12-31 0001386716 sblk:CitibankEurope3PLCMember 2023-12-31 0001386716 sblk:CitibankEurope3PLCMember sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:CitibankEurope3PLCMember sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:ING2Member 2023-01-01 2023-12-31 0001386716 sblk:ING2Member 2023-12-31 0001386716 sblk:ING2Member sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:ING2Member sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB2Member 2023-01-01 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB2Member 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB2Member sblk:InitialNotionalMember 2023-12-31 0001386716 sblk:SkandinaviskaEnskildaBankenAB2Member sblk:CurrentNotionalMember 2023-12-31 0001386716 sblk:CitibankEuropeMember sblk:CurrentNotionalMember 2023-12-31 0001386716 srt:ScenarioForecastMember 2024-12-31 0001386716 sblk:SixForeignCurrencyForwardContractsMember sblk:ReceivedAmountinAUDMember 2023-12-31 0001386716 sblk:SixForeignCurrencyForwardContractsMember 2023-12-31 0001386716 us-gaap:DerivativeMember 2022-12-31 0001386716 us-gaap:DerivativeMember 2023-12-31 0001386716 sblk:ForwardFreightAgreementsMember 2021-01-01 2021-12-31 0001386716 sblk:ForwardFreightAgreementsMember 2022-01-01 2022-12-31 0001386716 sblk:ForwardFreightAgreementsMember 2023-01-01 2023-12-31 0001386716 sblk:BunkerSwapsMember 2021-01-01 2021-12-31 0001386716 sblk:BunkerSwapsMember 2022-01-01 2022-12-31 0001386716 sblk:BunkerSwapsMember 2023-01-01 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:NondesignatedMember sblk:ForwardFreightAgreementsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:ForwardFreightAgreementsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:NondesignatedMember sblk:ForwardFreightAgreementsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:ForwardFreightAgreementsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:NondesignatedMember sblk:BunkerSwapsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:BunkerSwapsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:NondesignatedMember sblk:BunkerSwapsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:BunkerSwapsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:NondesignatedMember sblk:DerivativeFinancialInstrumentsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:DerivativeFinancialInstrumentsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:NondesignatedMember sblk:DerivativeFinancialInstrumentsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:DerivativeFinancialInstrumentsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:NondesignatedMember us-gaap:InterestRateSwapMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:NondesignatedMember us-gaap:InterestRateSwapMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:NondesignatedMember us-gaap:ForeignExchangeForwardMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:ForeignExchangeForwardMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:NondesignatedMember us-gaap:ForeignExchangeForwardMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:ForeignExchangeForwardMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:NondesignatedMember sblk:DerivativeFinancialInstrumentsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:DerivativeFinancialInstrumentsMember 2022-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:NondesignatedMember sblk:DerivativeFinancialInstrumentsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember sblk:DerivativeFinancialInstrumentsMember 2023-12-31 0001386716 us-gaap:FairValueInputsLevel1Member 2023-12-31 0001386716 us-gaap:FairValueInputsLevel2Member 2023-12-31 0001386716 us-gaap:FairValueInputsLevel3Member 2023-12-31 0001386716 sblk:ImpairmentLossMember 2023-01-01 2023-12-31 0001386716 us-gaap:SubsequentEventMember sblk:BigFishStarGloryMember 2024-01-01 2024-01-31 0001386716 us-gaap:SubsequentEventMember sblk:StarVoyagerMember 2024-01-01 2024-01-11 0001386716 us-gaap:SubsequentEventMember sblk:StargazerMember 2024-01-01 2024-01-16 0001386716 us-gaap:SubsequentEventMember sblk:StarExplorerMember 2024-01-01 2024-03-08 0001386716 us-gaap:SubsequentEventMember sblk:PantagruelMember 2024-01-01 2024-01-02 0001386716 us-gaap:SubsequentEventMember sblk:BingBangMember 2024-01-01 2024-02-07 0001386716 us-gaap:SubsequentEventMember sblk:StarAudreyMember 2024-01-01 2024-02-20 0001386716 us-gaap:SubsequentEventMember sblk:StarPyxisMember 2024-01-01 2024-02-20 0001386716 us-gaap:SubsequentEventMember sblk:NBG125Member 2024-01-31 0001386716 us-gaap:SubsequentEventMember sblk:ING6Member 2024-01-31 0001386716 us-gaap:SubsequentEventMember sblk:CITI100Member 2024-01-31 0001386716 us-gaap:SubsequentEventMember sblk:ING6Member 2024-02-29 0001386716 us-gaap:SubsequentEventMember 2024-02-12 0001386716 us-gaap:SubsequentEventMember 2024-01-01 2024-02-12 0001386716 us-gaap:SubsequentEventMember sblk:ING100Member 2024-03-31 0001386716 us-gaap:SubsequentEventMember sblk:ABNAMRO94Member 2024-03-31 0001386716 us-gaap:SubsequentEventMember sblk:DNB100Member 2024-03-31 0001386716 us-gaap:SubsequentEventMember sblk:ESUN100Member 2024-03-31 0001386716 us-gaap:SubsequentEventMember sblk:INGABNAMRODNBESUNMember 2024-01-01 2024-03-31 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure iso4217:EUR

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

 

FORM 20-F

 

  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 31,2023

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

For the transition period from _____________ to ______________ 

Commission file number 001-33869

 

 

STAR BULK CARRIERS CORP.

(Exact name of Registrant as specified in its charter)

 

 

 

  

--12-31

Not Applicable

 

(Translation of Registrant’s name into English)

 

 

Republic of the Marshall Islands

(Jurisdiction of incorporation or organization)

 

 

c/o Star Bulk Management Inc., 40 Agiou Konstantinou Str., Maroussi 15124, Athens, Greece

(Address of principal executive offices)

 

 

Petros Pappas, 011 30 210 617 8400, mgt@starbulk.com,

c/o Star Bulk Management Inc., 40 Agiou Konstantinou Str.

Maroussi 15124, Athens, Greece 

(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 each class Trading Symbol(s) Name of exchange on which registered

Common Shares, par value $0.01 per share

SBLK

Nasdaq Global Select Market

 

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, 2023, there were 84,016,892 common shares issued and 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 report 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 definition 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).

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. Yes No

 

ABOUT THIS REPORT

Throughout this annual report, unless otherwise indicated:

·“Star Bulk,” the “Company,” “we,” “us,” “our” or similar terms refer to Star Bulk Carriers Corp. and its wholly owned subsidiaries, except that when such terms are used in this annual report in reference to the common stock, they refer specifically to Star Bulk Carriers Corp.;
·the term deadweight ton (“dwt”) refers to 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;
·“Newcastlemax” refers to vessels with carrying capacities of between 200,000 dwt and 210,000 dwt;
·“Capesize” refers to vessels with carrying capacities of between 100,000 dwt and 200,000 dwt;
·“Post-Panamax” refers to vessels with carrying capacities of between 90,000 dwt and 100,000 dwt;
·“Kamsarmax” refers to vessels with carrying capacities of between 80,000 dwt and 90,000 dwt;
·“Panamax” refers to vessels with carrying capacities of between 65,000 and 80,000 dwt;
·“Ultramax” refers to vessels with carrying capacities of between 60,000 and 65,000 dwt;
·“Supramax” refers to vessels with carrying capacities of between 50,000 and 60,000 dwt;
·“Oaktree” refers to Oaktree Capital Management, L.P., together with its affiliates; and
·all references to “Dollars” and “$” in this annual report are to U.S. Dollars and all references to “Euro” and “€” in this annual report are to Euros.

 

  i 

 

FORWARD-LOOKING STATEMENTS

Star Bulk Carriers Corp. and its wholly owned subsidiaries (the “Company”, “we”, “our”, “us” or similar terms) desire to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are including this cautionary statement in connection with this safe harbor legislation. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.

This document includes “forward-looking statements,” as defined by U.S. federal securities laws, with respect to our financial condition, results of operations and business and our expectations or beliefs concerning future events. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “projects,” “likely,” “would,” “will,” “could,” “should,” “may,” “forecasts,” “potential,” “continue,” “possible” and similar expressions or phrases may identify forward-looking statements.

All forward-looking statements involve risks and uncertainties. The occurrence of the events described, and the achievement of the expected results, depend on many events, some or all of which are not predictable or within our control. Actual results may differ materially from expected results.

In addition, important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include:

uncertainties as to the timing of the proposed merger between the Company, Star Infinity Corp., a Marshall Islands corporation and a wholly owned subsidiary of Star Bulk (“Merger Sub”) and Eagle Bulk Shipping Inc., a Marshall Islands corporation (“Eagle” and such merger, the “Eagle Merger”);
the possibility that the closing conditions, including approval of Eagle shareholders (as defined below), to the proposed Eagle Merger may not be satisfied or waived;
the possibility that costs or difficulties related to the integration of the Company’s and Eagle’s operations will be greater than expected;
the effects of disruption by the announcement of the proposed Eagle Merger making it more difficult to maintain relationships with employees, customers, vendors and other business partners;
risks related to the proposed Eagle Merger diverting management’s attention from the Company’s and Eagle’s ongoing business operations;
the possibility that the expected synergies and value creation from the proposed Eagle Merger will not be realized, or will not be realized within the expected time period;
the risk that shareholder litigation in connection with the contemplated transactions may affect the timing or occurrence of the proposed Eagle Merger or result in significant costs of defense, indemnification and liability;

transaction costs related to the Eagle Merger;
general dry bulk shipping market conditions, including fluctuations in charter rates and vessel values;
the strength of world economies;
the stability of Europe and the Euro;
fluctuations in currencies, interest rates and foreign exchange rates;
business disruptions due to natural and other disasters or otherwise, such as the impact of any new outbreaks or new variants of coronavirus (“COVID-19”) that may emerge;
the length and severity of epidemics and pandemics and their impact on the demand for seaborne transportation in the dry bulk sector;
changes in supply and demand in the dry bulk shipping industry, including the market for our vessels and the number of new buildings under construction;
the potential for technological innovation in the sector in which we operate and any corresponding reduction in the value of our vessels or the charter income derived therefrom;
changes in our expenses, including bunker prices, dry docking, crewing and insurance costs;
changes in governmental rules and regulations or actions taken by regulatory authorities;
 •potential liability from pending or future litigation and potential costs due to environmental damage and vessel collisions;
the impact of increasing scrutiny and changing expectations from investors, lenders, charterers and other market participants with respect to our Environmental, Social and Governance (“ESG”) practices;
our ability to carry out our ESG initiatives and thereby meet our ESG goals and targets including as set forth under “Item 4. Information on the Company –– B. Business Overview –– Our ESG Performance”;
new environmental regulations and restrictions, whether at a global level stipulated by the International Maritime Organization, and/or regional/national imposed by regional authorities such as the European Union or individual countries;
potential cyber-attacks which may disrupt our business operations;
general domestic and international political conditions or events, including “trade wars,” the ongoing conflict between Russia and Ukraine, the conflict between Israel and Hamas and the Houthi attacks in the Red Sea and the Gulf of Aden;
the impact on our common shares and reputation if our vessels were to call on ports located in countries that are subject to restrictions imposed by the U.S. or other governments;
our ability to successfully compete for, enter into and deliver our vessels under time charters or other employment arrangements for our existing vessels after our current charters expire and our ability to earn income in the spot market;
potential physical disruption of shipping routes due to accidents, climate-related reasons (acute and chronic), political events, public health threats, international hostilities and instability, piracy or acts by terrorists;
the availability of financing and refinancing;
the failure of our contract counterparties to meet their obligations;
our ability to meet requirements for additional capital and financing to complete our newbuilding program and grow our business;

 ii  

 

the impact of our indebtedness and the compliance with the covenants included in our debt agreements;

vessel breakdowns and instances of off-hire;

potential exposure or loss from investment in derivative instruments;

potential conflicts of interest involving our Chief Executive Officer, his family and other members of our senior management;

our ability to complete acquisition transactions as and when planned and upon the expected terms;

the impact of port or canal congestion or disruptions; and

other important factors described in “Item 3. Key Information –– D. Risk Factors” in this annual report.

 

  iii 

 

We have based these statements on assumptions and analyses formed by applying our experience and perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate in the circumstances. All future written and verbal forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We undertake no obligation, and specifically decline any obligation, except as required by law, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this annual report might not occur. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement.

See the section entitled “Item 3. Key Information –– D. Risk Factors” of this annual report on Form 20-F for the year ended December 31, 2023 for a more complete discussion of these risks and uncertainties and for other risks and uncertainties. These factors and the other risk factors described in this annual report are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could harm our results. 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.

 

  iv 

 

TABLE OF CONTENTS

PART I. 6
Item 1.   Identity of Directors, Senior Management and Advisers 6
Item 2.   Offer Statistics and Expected Timetable 6
Item 3.   Key Information 6
Item 4.   Information on the Company 30
Item 4A.   Unresolved Staff Comments 61
Item 5.   Operating and Financial Review and Prospects 61
Item 6.   Directors, Senior Management and Employees 90
Item 7.   Major Shareholders and Related Party Transactions 98
Item 8.   Financial Information 112
Item 9.   The Offer and Listing 113
Item 10.   Additional Information 114
Item 11.   Quantitative and Qualitative Disclosures about Market Risk 131
Item 12.   Description of Securities Other than Equity Securities 134
PART II. 135
Item 13.   Defaults, Dividend Arrearages and Delinquencies 135
Item 14.   Material Modifications to the Rights of Security Holders and Use of Proceeds 135
Item 15.   Controls and Procedures 135
Item 16A.   Audit Committee Financial Expert 136
Item 16B.   Code of Ethics 136
Item 16C.   Principal Accountant Fees and Services 136
Item 16D.   Exemptions from the Listing Standards for Audit Committees 137
Item 16E.   Purchases of Equity Securities by the Issuer and Affiliated Purchasers 137
Item 16F.   Change in Registrant’s Certifying Accountant 138
Item 16G.   Corporate Governance 138
Item 16H.   Mine Safety Disclosure 139
Item 16I.   Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. 139
Item 16K.   Cybersecurity. 139
PART III. 142
Item 17.   Financial Statements 142
Item 18.   Financial Statements 142
Item 19.   Exhibits 142

 

 v  

PART I.

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

Risk Factor Summary

 

Risks Related to Our Industry

·Our results of operations and financial condition depend significantly on charter rates for dry bulk vessels, which may be highly volatile and are affected by macroeconomic factors outside of our control;
·Global economic conditions may continue to negatively impact the dry bulk shipping industry and may materially affect our results of operations and financial condition;
·A variety of shipping industry factors, including among our competitors, along with general economic conditions may cause a decline in the market values of our vessels which could limit the amount of funds that we can borrow, cause us to breach certain financial covenants in our credit facilities, result in impairment charges or losses on sale;
·We are subject to complex laws and regulations, including environmental regulations, international safety regulations and vessel requirements imposed by classification societies that can adversely affect the cost, manner or feasibility of doing business;
·The operation of dry bulk carriers entails certain operational risks that could affect our earnings and cash flow;
·If our vessels call on ports or territories located in countries that are subject to restrictions, sanctions, or embargoes imposed by the United States government, the European Union (“EU”), the United Nations (“UN”) or other governments, it could lead to monetary fines or other penalties and adversely affect our reputation and the price for our common shares;

 

 6 
Table of Contents

 

 

·Fuel or bunker prices and marine fuel availability have adversely affected our profitability and may adversely affect our profitability in the future;
·Failure to comply with the U.S. Foreign Corrupt Practices Act (the “FCPA”) and other anti-corruption laws could result in fines, criminal penalties, charter terminations and an adverse effect on our business;
·Our operating results are subject to seasonal fluctuations; and
·Acts of piracy and attacks on ocean-going vessels could adversely affect our business.

Risks Related to Our Company

·We may face liquidity issues if conditions in the dry bulk market worsen for a prolonged period and cause us to fail to comply with the terms of our debt agreements which could adversely affect our business, including our ability to refinance our indebtedness and pay dividends;
·An increase in the Secured Overnight Finance Rate (“SOFR”) could affect our earnings and cash flow;
·We have considerable risks relating to the construction of our newbuilding vessels;

 

·We may not have adequate insurance to compensate us if we lose our vessels or they suffer significant damages or to compensate third parties for any damages to their property;
·We depend upon third-party and/or affiliated managers to provide the technical management of our fleet;
·The aging of our fleet and our practice of purchasing and operating secondhand vessels may result in increased operating costs and vessels off- hire, which could adversely affect our earnings; and
·We may be unable to attract and retain qualified, skilled employees or crew necessary to operate our business.

Risks Related to the Eagle Merger

·The completion of the Eagle Merger is subject to a number of conditions and the Agreement and Plan of Merger, dated as of December 11, 2023, by and among the Company, Merger Sub and Eagle (the “Eagle Merger Agreement”) may be terminated in accordance with its terms. As a result, there is no assurance when or if the Eagle Merger will be completed;
·Uncertainties associated with the Eagle Merger may cause a loss of management personnel and other key employees, which could adversely affect our future business and operations following completion of the Eagle Merger; and
·If the completion of the Eagle Merger occurs, we may not realize all of the anticipated benefits of the Eagle Merger or those benefits may take longer to realize than expected. We may also encounter significant difficulties in integrating the two businesses.

Risks Related to Taxation

·A change in tax laws, treaties or regulations, or their interpretation could result in a significant negative impact on our earnings and cash flows from operations; and
·The Internal Revenue Service could treat us as a “passive foreign investment company,” (or “PFIC”) which could have adverse U.S. federal income tax consequences to U.S. shareholders.

 

 7 
Table of Contents

 

Risks Related to Our Relationships with Mr. Pappas, Oaktree and Other Parties

·Members of management and our directors may have relationships and affiliations with other entities that could create conflicts of interest.

Risks Related to Our Corporate Structure and Our Common Shares

·We are a holding company and depend on the ability of our subsidiaries to distribute funds to us in order to satisfy our financial obligations and to make dividend payments;
·We may need to raise additional capital in the future, which may not be available on favorable terms or at all or which may dilute our common stock or adversely affect its market price;
·Our financing arrangements impose a number of restrictions on our ability to pay dividends, and we may not be able to pay dividends even though we have an established dividend policy;
·The price of our common shares may be highly volatile; and
·Anti-takeover provisions in our organizational documents could have the effect of discouraging, delaying or preventing a merger or acquisition, or could make it difficult for our shareholders to replace or remove our current Board of Directors, which could adversely affect the market price of our common shares.

The following risks relate principally to the industry in which we operate and our business in general. Other risks relate principally to the securities market and ownership of our common shares. The occurrence of any of the events described in this section could significantly and negatively affect our business, financial condition, operating results or the trading price of our common shares.

Risks Related to Our Industry

Our results of operations and financial condition depend significantly on charter rates for dry bulk vessels, which may be highly volatile and are affected by macroeconomic factors outside of our control. If we cannot charter our vessels on favorable terms, there could be a material adverse effect on our earnings and our ability to comply with our loan covenants.

The dry bulk shipping industry continues to be cyclical with high volatility in charter rates and profitability among the various types of dry bulk vessels. In 2023, charter rates for dry bulk vessels decreased from 2022’s levels but were sustained slightly above the 10-year average. The Baltic Dry Index, or the “BDI”, an index published by The Baltic Exchange of shipping rates for key dry bulk routes, decreased by 29% from 2022 levels but averaged 1% above the decade average. During 2023, there was elevated demand for commodities, but this was offset by the increased fleet utilization as a result of the easing of the COVID-19 related inefficiencies. See “Item 4. Information on the Company –– B. Business Overview –– The International Dry Bulk Shipping Industry” for further details.

Charter rate fluctuations result from changes in the supply of and demand for vessel capacity and major commodities carried on water internationally. Because most factors affecting the supply of and demand for vessels are outside of our control and are unpredictable, the nature, timing, direction and degree of changes in charter rates are also unpredictable. Since we charter our vessels principally in the spot market, we are exposed to the spot market’s cyclicality and volatility. We may not be able to predict whether future spot rates will be sufficient to enable our vessels to be operated profitably. Factors that influence the demand for dry bulk vessel capacity include:

 8 
Table of Contents

 

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; global and regional economic and political conditions and developments, including armed conflicts such as the ongoing conflict between Russia and Ukraine, the conflict between Israel and Hamas, the recent Houthi seizures and attacks on vessels traveling through the Red Sea and the Gulf of Aden and terrorist activities; natural disasters and weather; pandemics; embargoes and strikes; disruptions and developments in international trade, including trade disputes or the imposition of tariffs 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 regulatory developments; and currency exchange rates. Factors that influence the supply of dry bulk vessel capacity include: the number of newbuilding orders and deliveries including slippage in deliveries; number of shipyards and ability of shipyards to deliver vessels; port and canal congestion; speed of vessel operation; vessel casualties; the degree of recycling of older vessels, depending, among other things, on recycling rates and international recycling regulations; number of vessels that are out of service, namely those that are laid-up, dry docked, awaiting repairs or otherwise not available for hire; availability of financing for new vessels and shipping activity; changes in national or international regulations that may effectively cause reductions in the carrying capacity of vessels or early obsolescence of tonnage; and changes in environmental and other regulations that may limit the useful lives of vessels. In addition to the prevailing and anticipated freight rates, factors that affect the rate 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, given that they may impose technological and other requirements upon our vessels.

As described above, many of the 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 we are required to charter our vessels at a time when demand and charter rates are very low, we may not be able to secure employment for our vessels at all, or we may have to accept reduced and potentially unprofitable rates. If we are unable to secure profitable employment for our vessels, we may decide to lay-up some or all unemployed vessels until such time that charter rates become attractive again. During the lay-up period, we will continue to incur some expenditures, such as insurance and maintenance costs, for each such vessel. Additionally, before exiting lay-up, we will have to pay reactivation costs for any such vessel to regain its operational condition. As a result, adverse economic, political, social or other developments affecting charter rates could have a material adverse effect on our business, results of operations and cash flows, ability to pay dividends and compliance with covenants in our credit facilities.

Global economic conditions may continue to negatively impact the dry bulk shipping industry and may materially affect our results of operations and financial condition.

The world economy is currently facing a number of ongoing challenges as a result of significant inflation and increased interest rates due to interest raises by the U.S. Federal Reserve and other central banks. Inflation and rising interest rates may raise the cost of acquiring capital, increase our operating costs and generally reduce economic growth, disrupting global trade and shipping. Concerns over inflation, rising interest rates and the availability and cost of capital, as well as geopolitical issues, including acts of war and recent turmoil and hostilities in various regions, including Iraq, North Korea, Venezuela, North Africa, Ukraine, Israel and Palestine have contributed to increased volatility and diminished expectations for the economy and the markets going forward. Further, these factors, combined with volatile oil prices, declining business and consumer confidence, have precipitated fears of a possible economic recession. Domestic and international equity markets continue to experience heightened volatility and turmoil. The weakness in the global economy has caused, and may continue to cause, a decrease in worldwide demand for certain goods and, thus, shipping.

 

 9 
Table of Contents

 

Our business could also be adversely impacted by trade tariffs, trade embargoes or other economic sanctions that limit trading activities by the United States or other countries against countries in the Middle East, Asia or elsewhere as a result of terrorist attacks, hostilities or diplomatic or political pressures. In 2022, in response to the ongoing conflict in Ukraine, the U.S. and several European countries imposed various economic sanctions against Russia, prohibitions on imports of Russian energy products, including crude oil, petroleum, petroleum fuels, oils, liquefied natural gas and coal, and prohibitions on investments in the Russian energy sector by US persons, among other restrictions. The geopolitical situation in Eastern Europe intensified in late February 2022, with the commencement of Russia’s military action against Ukraine. Three of our vessels, the Star PavlinaStar Helena and Star Laura, had arrived in three different Ukrainian ports to load various grain cargos under charterers’ instructions, well ahead of the commencement of the war activities, but following the beginning of the conflict, the loading operations were suspended by the port authorities. Following a multilateral agreement among Russia, Ukraine, Turkey and the United Nations to resume grain exports from the Black Sea regions, we succeeded in safely navigating the Star Helena and the Star Laura out of Ukraine in August 2022 when the two said vessels returned to normal trading. During the first quarter of 2023, we agreed with the war risk insurers of the vessel Star Pavlina, that the vessel became a constructive total loss as of February 24, 2023, given its prolonged detainment in Ukraine following the commencement of Russia’s military action against Ukraine on February 24, 2022. By May 4, 2023, we collected the total corresponding insurance value of this vessel.

The ongoing conflict between Russia and Ukraine, the conflict between Israel and Hamas and the recent Houthi attacks and seizures of vessels may lead to further regional and international conflicts or armed action. It is possible that such conflicts could disrupt supply chains and cause instability in the global economy, particularly as some companies have decided to reroute vessels to avoid the Suez Canal and Red Sea. As of February 13, 2024, we have been rerouting our vessels to avoid the Red Sea and the Gulf of Aden as a result of the recent Houthi attacks and seizures of vessels traveling through this area. Additionally, the ongoing conflict between Russia and Ukraine could result in the imposition of further economic sanctions by the United States and the European Union against Russia. While much uncertainty remains regarding the global impact of the aforementioned conflicts, it is possible that such tensions could adversely affect our business, financial condition, results of operation and cash flows. Furthermore, it is possible that third parties with whom we have charter contracts may be impacted by events in Russia, Ukraine, Israel and Palestine, which could adversely affect our operations.

The U.K.’s exit from the EU in 2020 (informally known as “Brexit”) has led to ongoing political and economic uncertainty and periods of increased volatility in both the U.K. and in wider European markets for some time. Brexit’s long-term effects are still yet to be determined at this time and will depend on the effects of the implementation and application of the trade and cooperation agreement signed by the U.K. and EU in 2020 and any other relevant agreements between the U.K. and EU. It remains possible that there will be increased regulatory and legal complexities, including those relating to tax, trade and employees. Brexit has also given rise to calls of other EU member states’ governments to consider withdrawal. These developments and uncertainties, or the perception that they may occur, have had and may continue to have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global market liquidity and restrict the ability of key market participants to operate in certain financial markets. Additionally, Brexit or similar events in other jurisdictions, could impact global markets, including foreign exchange and securities markets. The foregoing factors could depress economic activity and restrict our access to capital, causing a material adverse effect on our business and on our consolidated financial position, results of operations and our ability to pay dividends.

The U.S.-China trade tension, including the introduction by the U.S. government of tariffs affecting certain goods imported by China, may provoke further retaliatory trade actions from the affected countries. It is unknown whether and to what extent new tariffs (or other new laws or regulations) will be adopted, or the effect that any such actions would have on us or our industry. If any new tariffs, legislation and/or regulations are implemented, or if existing trade agreements are renegotiated, such changes could have an adverse effect on our business, financial condition, and results of operations.

 10 
Table of Contents

 

Relatively weak global economic conditions have had and may continue to have a number of adverse consequences for dry bulk and other shipping sectors, including, among other things; low charter rates, particularly for vessels employed on short-term time charters or in the spot market; decreases in the market value of dry bulk vessels and limited secondhand market for the sale of vessels; limited financing for vessels; widespread loan covenant defaults; and declaration of bankruptcy by certain vessel operators, vessel owners, shipyards and charterers. The occurrence of one or more of these events could have a material adverse effect on our business, results of operations, cash flows and financial condition.

An economic slowdown or changes in the economic and political environment in the Asia Pacific region could have a material adverse effect on our business, results of operations and financial condition.

We anticipate a significant number of the port calls made by our vessels will continue to involve the loading or discharging of dry bulk commodities in ports in the Asia Pacific region. As a result, economic slowdown in the Asia Pacific region, particularly in China, may have a material adverse effect on us. In addition, a number of our newbuilding vessels are being built at Chinese shipyards. We conduct a substantial portion of our business in China or with Chinese counter parties. A decrease in the level of imports to and exports from China could adversely affect our business, results of operations and financial condition. Changes in the economic conditions of China, and policies adopted by the government to regulate its economy, tax matters and environmental concerns (such as achieving carbon neutrality) and their implementation by local authorities could affect our vessels that are either chartered to Chinese customers or that call to Chinese ports, our vessels that undergo dry docking at Chinese shipyards and the financial institutions with whom we have entered into financing agreements, and could have a material adverse effect on our business, results of operations and financial condition.

A variety of shipping industry factors, including among our competitors, along with general economic conditions may cause a decline in the market values of our vessels which could limit the amount of funds that we can borrow, cause us to breach certain financial covenants in our credit facilities, result in impairment charges or losses on sale.

The fair market values of dry bulk vessels have generally experienced high volatility. The fair market value of our vessels depends on a number of factors, including: prevailing level of charter rates, general economic and market conditions affecting the shipping industry, types, sizes and ages of vessels, supply of and demand for vessels, other modes of transportation, distressed asset sales, including newbuilding contract sales below acquisition costs due to lack of financing, cost of new buildings, governmental or other regulations, the need to upgrade vessels as a result of charterer requirements, technological advances in vessel design or equipment or otherwise, changes in environmental and other regulations that may limit the useful life of vessels, technological advances; and competition from other shipping companies and other modes of transportation. If the fair market value of our vessels declines, we might not be in compliance with various covenants in our ship financing facilities, some of which require the maintenance of a certain percentage of fair market value of the vessels securing the facility to the principal outstanding amount of the loans under the facility or a maximum ratio of total liabilities to market value adjusted total assets or a minimum market value adjusted net worth. In addition, if the fair market value of our vessels declines, our access to additional funds may be affected or we may need to record impairment charges in our consolidated financial statements or incur loss on sale of vessels which can adversely affect our financial results. Conversely, if vessel values are elevated at a time when we wish to acquire additional vessels, the cost of such acquisitions may increase and this could adversely affect our business, results of operations, cash flow and financial condition. 

 11 
Table of Contents

 

We are subject to complex laws and regulations, including environmental regulations, international safety regulations and vessel requirements imposed by classification societies that can adversely affect the cost, manner or feasibility of doing business.

Our operations are subject to numerous international, national, state and local laws, regulations, treaties and conventions in force in international waters and the jurisdictions in which our vessels operate or are registered, which can significantly affect the ownership and operation of our vessels. See “Item 4. Information on the Company –– B. Business Overview –– Environmental and Other Regulations in the Shipping Industry” for further details. Compliance with such requirements may require vessels to be altered, costly equipment to be installed (such as ballast water treatment systems or “BWTS”) or operational changes to be implemented and may decrease the resale value or reduce the useful lives of our vessels or require us to obtain certain permits or authorizations prior to commencing operations. Such compliance costs could have a material adverse effect on our business, financial condition and results of operations. If any vessel does not comply (i.e. fails to maintain its class or fails any annual, intermediate or special survey) the vessel will be unable to trade between ports and will be unemployable and uninsurable until such failures are remedied, which could negatively impact our results of operations and financial condition. In addition, given frequent regulatory changes, we cannot predict their effect on our ability to do business, the cost of complying with them, or their impact on vessels’ useful lives or resale value. Our failure to comply with any such conventions, laws, or regulations could cause us to incur substantial liability.

Climate change and related legislation or regulations may adversely impact our business, including potential financial, operational and physical impacts.

Growing concern about the sources and impacts of global climate change has led to the proposal or enactment of a number of domestic and foreign legislative and administrative measures, as well as international agreements and frameworks, to monitor, regulate and limit carbon dioxide and other greenhouse gas (“GHG”) emissions. Although the Paris Agreement, which was adopted under the UN Framework Convention on Climate Change in 2015, does not specifically require controls on GHG emissions from ships, it is possible that countries seek to impose such controls as they implement the Paris Agreement or any new treaty that may be adopted in the future. In the European Union, emissions are regulated under the EU Emissions Trading System (the “EU ETS”), an EU-wide trading scheme for industrial GHG emissions. Effective January 1, 2024, the EU ETS was extended to cover CO2 emissions from all ships of 5,000 gross tonnage and above, entering EU ports, regardless of the flag they fly. The system covers: a) 50% of emissions from voyages starting or ending outside of the EU (allowing the third country to decide on appropriate action for the remaining share of emissions) and b) 100% of emissions that occur between two EU ports and when ships are within EU ports. The EU ETS covers CO2 (carbon dioxide) initially, and will be extended to CH4 (methane) and N2O (nitrous oxide) emissions in 2026. Shipping companies will need to surrender to the relevant EU authorities the allowances that correspond to the emissions covered by the system. These allowances are normally purchased by the entity responsible for the purchase of bunkers. For example, for time charter agreements, the responsible entity is the charterer. For voyage charter agreements, the cost of the allowances is normally included in the charter rate. In addition, in June 2021, the IMO adopted amendments to MARPOL Annex VI that entered into force on November 1, 2022 and require ships to reduce GHG emissions using technological and operational approaches to improve energy efficiency and that provide important building blocks for future GHG reduction measures.

These requirements and any passage of additional climate control legislation or other regulatory initiatives by the IMO, the European Union, the United States or other countries where we operate, or any treaty adopted at the international level, that restrict emissions of GHGs could require us to make significant financial expenditures, including the installation of pollution controls and the purchase of emissions credits, as well as have other impacts on our business or operations, that we cannot predict with certainty at this time. While we have installed scrubbers on 108 vessels out of the 112 vessels in our fleet, as of the date of this annual report, pursuant to IMO sulfur cap regulations, we may be required in the future to expend more capital to modify, upgrade or replace vessels as a result of new climate- or GHG- related rules and regulations. While IMO has set specific targets for 2030 and 2050 within the scope of its GHG emissions reduction strategy, currently only short-term measures have been adopted thus far, which we do not believe at this time will require material capital expenditures. Should additional medium-term measures be adopted and come into force, including market-based measures to put a price on carbon emissions, we may need to incur additional capital expenditures to comply with the relevant GHG emission regulations. Even in the absence of climate control legislation and regulations, our business and operations may be materially affected to the extent that climate change results in sea level changes or more intense weather events. For additional information see “Item 4. Information on the Company –– B. Business Overview –– Environmental and Other Regulations in the Shipping Industry”.

 12 
Table of Contents

Increasing scrutiny and changing expectations from investors, lenders, charterers and other market participants with respect to our ESG practices may impose additional costs on us or expose us to additional risks.

Companies across all industries are facing increasing scrutiny relating to their ESG policies from investor advocacy groups, certain institutional investors, lenders, charterers and other market participants (collectively, the “Market Participants”), who, in recent years, have focused on the implications and social cost of their investments. Such increased attention and activism related to ESG and similar matters (such as climate change) may hinder access to capital, as Market Participants may decide to reallocate capital or to decline to commit capital as a result of their assessment of a company’s ESG practices, and may also affect the commercial tradability of our vessels should our vessels fail to comply with charterers’ ESG requirements. For example, due to such increasing pressures from Market Participants to prioritize sustainable energy practices, reduce our carbon footprint, and promote sustainability, we may be required to implement more stringent ESG procedures or standards so that our existing and future Market Participants remain invested in us, make further investments in us and continue chartering our vessels. However, if we do not adapt to or comply with such evolving expectations and standards, or are perceived to have failed to respond appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage and our business, financial condition, and/or stock price could be materially and adversely affected. Furthermore, certain Market Participants in the equity and debt capital markets may exclude transportation companies, such as us, from their investing portfolios altogether due to ESG factors, which may affect our ability to grow, as our plans for growth may include accessing the foregoing markets. If those markets are unavailable, or if we are unable to access alternative means of financing on acceptable terms, or at all, we may be unable to implement our business strategy, which would have a material adverse effect on our financial condition and results of operations and impair our ability to service our indebtedness. Overall, it is likely that we will incur additional costs and require additional resources to monitor, report and comply with wide ranging ESG requirements. The occurrence of any of the foregoing could have a material adverse effect on our business and financial condition. Please see “Item 4. Information on the Company –– B. Business Overview –– Our ESG Performance” for additional information with respect to our ongoing ESG efforts.

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

International shipping is subject to security and customs inspection and related procedures in countries of origin, destination and trans-shipment points. Under the U.S. Maritime Transportation Security Act of 2002 (the “MTSA”), the United States Coast Guard (“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. These security procedures can result in the seizure of contents of our vessels, delays in the loading, offloading, trans- shipment or delivery and the levying of customs duties, fines or other penalties against us. Changes to inspection procedures could impose additional financial and legal obligations on us, could also impose additional costs and obligations on our customers and may, in certain cases, render the shipment of certain types of cargo uneconomical or impractical. These additional costs could reduce the volume of goods shipped, resulting in a decreased demand for vessels and have a negative effect on our business, financial condition, cash flows, results of operations and our ability to pay dividends.

 

 13 
Table of Contents

 

The operation of dry bulk carriers entails certain operational risks that could affect our earnings and cash flow.

The international shipping industry faces risks inherent to global operations. Our vessels and their cargoes risk damage or loss as a result of events including, but not limited to, marine disasters, bad weather, mechanical failures, human error, environmental accidents, war, terrorism, piracy and other circumstances or events. In addition, transporting cargoes across a wide variety of international jurisdictions creates a risk of business interruptions due to political circumstances in foreign countries, hostilities, labor strikes and boycotts, the potential for changes in tax rates or policies, and the potential for government expropriation of our vessels. Any of these events may result in loss of revenues, increased costs and decreased cash flows to our customers, which could impair their ability to make payments to us under our charters. Furthermore, the operation of dry bulk carriers has certain unique risks as: (i) dry bulk cargo itself and its interaction with the vessel can be an operational risk, (ii) dry bulk cargoes are often heavy, dense and easily shifted and react badly to water exposure, and (iii) dry bulk carriers are often subjected to battering treatment during unloading operations with grabs, jackhammers (to pry encrusted cargoes out of the hold) and small bulldozers, causing damage to the vessel. Vessels damaged due to treatment during unloading procedures may be more susceptible to breach at sea. Hull breaches in dry bulk carriers may lead to the flooding of the vessels’ holds. If flooding occurs in the forward holds, the bulk cargo may become so waterlogged that the bulkhead may buckle under the resulting pressure, leading to loss of a vessel. If we are unable to adequately maintain our vessels, we may be unable to prevent these events. If our vessels suffer damage, they may need to be repaired at a drydocking facility for substantial and unpredictable costs that may not be fully covered by insurance. Space at drydocking facilities is sometimes limited, and not all drydocking facilities are conveniently located. The total loss or damage of any of our vessels or cargoes could harm our reputation as a safe and reliable vessel owner and operator. Any of these circumstances or events may have a material adverse effect on our business, results of operations, cash flows and financial condition. 

If our vessels call on ports or territories located in countries that are subject to restrictions, sanctions, or embargoes imposed by the United States government, the European Union (“EU”), the United Nations (“UN”), or other governments, it could lead to monetary fines or other penalties and adversely affect our reputation and the price for our common shares.

The United States, the European Union, the United Nations and other governments and their agencies impose sanctions and embargoes on certain countries and maintain lists of countries, individuals or entities they consider to be state sponsors of terrorism, involved in prohibited development of certain weapons or engaged in human rights violations. From time to time on charterers’ instructions, our vessels have called and may again call at ports located in countries subject to sanctions and embargoes imposed by the United States, the European Union, the United Nations and other governments and their agencies, including ports in Iran.

The applicable 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 expanded over time. We endeavor to take precautions to ensure that our customers are prohibited from entering any countries or conducting any trade which will breach U.S. government, EU, UN or any applicable sanctions regulation. However, on such customers’ instructions, and without our consent, there is a risk that our vessels may call on ports in countries or territories that violate such sanctions or embargoes.

Any violation of sanctions or embargo laws and regulations could result in fines or other penalties and could result in some investors deciding, or being required, to divest their interest, or not to invest, in us. Additionally, some investors may decide to divest their interest, or not to invest, in us simply because our vessels called a sanctionable area, even if that call would not breach any applicable sanctions regulation, or we do business with companies that do business in sanctioned countries. 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. War, terrorism, civil unrest and governmental actions in these and surrounding countries may adversely affect investor perception of the value of our common stock.

 14 
Table of Contents

 

Fuel, or bunker, prices and marine fuel availability have adversely affected our profitability and may adversely affect our profitability in the future.

Since we expect to primarily employ our vessels in the spot market, we expect that vessel fuel, known as bunkers, will be one of the largest single expense items in our shipping operations for our vessels. Changes in fuel prices have adversely affected our profitability and may adversely affect our profitability in the future. The price and supply of fuel are unpredictable and fluctuate based on events outside our control, including geopolitical developments (such as the ongoing conflicts between Russia and Ukraine and between Israel and Hamas), supply and demand for oil and gas, actions by the Organization of the Petroleum Exporting Countries and other oil and gas producers, war and unrest in oil producing countries and regions, regional production patterns and environmental concerns. Further, fuel may become much more expensive in the future, which may reduce our profitability and competitiveness of our business versus other forms of transportation, such as truck or rail. Lastly, if sulfur emissions regulations are relaxed in the future, or if the cost differential between low sulfur fuel and high sulfur fuel is lower than anticipated, we may not realize the economic benefits of the Scrubber Retrofitting Program, as further defined below under “Item 4. Information on the Company - B. Business Overview - Our Fleet.” As a result, we may experience a material, adverse effect on our financial condition and results of operations due to any of the foregoing changes.

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

Our vessels may call in ports where smugglers attempt to hide drugs and other contraband on vessels, with or without the knowledge of crew members. To the extent our vessels are found with contraband, whether inside or attached to the hull of our vessel and whether with or without the knowledge of any of our crew, we may face governmental or other regulatory claims or restrictions which could have an adverse effect on our reputation, business, financial condition, results of operations and cash flows.

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

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 claimant may seek to obtain security for its claim 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 money to have the arrest or attachment lifted. In addition, in some jurisdictions, such as South Africa, under the “sister ship” theory of liability, a claimant may arrest both the vessel which 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 attempt to assert “sister ship” liability against one vessel in our fleet for claims relating to another of our vessels.

Governments could requisition our vessels during a period of war or emergency, resulting in a loss of earnings.

A government could requisition one or more of our vessels for title or for hire. Requisition for title occurs when a government takes control of a vessel and becomes its owner, while requisition for hire occurs when a government takes control of a vessel and effectively becomes its charterer at dictated charter rates. Generally, requisitions occur during periods of war or emergency, although governments may elect to requisition vessels in other circumstances. Although we would be entitled to compensation in the event of a requisition of one or more of our vessels, the amount and timing of payment would be uncertain. Government requisition of one or more of our vessels may negatively impact our revenues.

 

 15 
Table of Contents

 

Failure to comply with the U.S. Foreign Corrupt Practices Act (the “FCPA”) and other anti-corruption laws could result in fines, criminal penalties, charter terminations and an adverse effect on our business.

We may operate in a number of countries throughout the world, including countries known to have a reputation for corruption. We are committed to doing business in accordance with applicable anti-corruption laws, including the FCPA. We are subject, however, to the risk that we, our affiliated entities or respective officers, directors, employees and agents may take actions determined to be in violation of such anti-corruption laws. Any such violation could result in substantial fines, sanctions, civil and/or criminal penalties and 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 time- and attention-consuming for our senior management.

Because we collect almost all of our revenues in U.S. dollars but incur a portion of our expenses in other currencies, exchange rate fluctuations could have an adverse impact on our results of operations.

We collect almost all of our revenues in U.S. dollars, and the majority of our expenses are denominated in U.S. dollars. However, a portion of our ship operating and administrative expenses are denominated in currencies other than U.S. dollars. If our expenditures on such costs and fees were significant, and the U.S. dollar were weak against such currencies, our business, results of operations, cash flows, financial condition and ability to pay dividends could be adversely affected. 

Our operating results are subject to seasonal fluctuations.

We operate our vessels in markets that have historically exhibited seasonal variations in demand and, as a result, in charter rates. This seasonality may result in volatility in our operating results to the extent that we enter into new charter agreements or renew existing agreements during a time when charter rates are weaker or we operate our vessels on the spot market or index-based time charters, which may result in quarter-to-quarter volatility in our operating results. The dry bulk sector is typically stronger during the second half of the year in anticipation of increased consumption of coal and other raw materials in the northern hemisphere. In addition, unpredictable weather patterns in these months tend to disrupt vessel scheduling and supplies of certain commodities. Since we charter our vessels principally in the spot market, our revenues from our dry bulk carriers are historically weaker during the fiscal quarters ended March 31 and June 30, and stronger during the fiscal quarters ended September 30 and December 31.

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

Acts of piracy and attacks have historically affected ocean-going vessels trading in certain regions of the world, such as the South China Sea, the Gulf of Aden and the Red Sea. Piracy continues to occur in the Gulf of Aden, off the coast of Somalia, and increasingly in the Gulf of Guinea. We consider potential acts of piracy to be a material risk to the international shipping industry, and protection against this risk requires vigilance. Our vessels regularly travel through regions where pirates are active. Furthermore, the recent Houthi seizures and attacks on commercial vessels in the Red Sea and the Gulf of Aden have impacted the global economy as some companies have decided to reroute vessels to avoid the Suez Canal and Red Sea. As of February 13, 2024, we have been rerouting our vessels to avoid the Red Sea and the Gulf of Aden as a result of the recent Houthi attacks and seizures of vessels traveling through this area. We may not be adequately insured to cover losses from acts of terrorism, piracy, regional conflicts and other armed actions, which could have a material adverse effect on our results of operations, financial condition and ability to pay dividends. Crew costs could also increase in such circumstances.

 

 16 
Table of Contents

 

Our financial results and operations may be adversely affected by COVID-19 and related governmental responses thereto.

In 2020, the initial outbreak of COVID-19 resulted in numerous actions taken by governments and governmental agencies in an attempt to mitigate the spread or any resurgence of the virus, including travel bans, quarantines, and other emergency public health measures such as lockdown measures. Initially, these measures resulted in a significant reduction in global economic activity and extreme volatility in the global financial markets. While many of these measures have since been relaxed, we cannot predict whether and to what degree such measures will be reinstituted in the event of any resurgence in COVID-19 or any new variants thereof, which may adversely affect global economic activity and could have a material adverse effect on the Company’s future business, results of operations, cash flows, financial condition, the carrying value of the Company’s assets, the fair values of the Company’s vessels, and the Company’s ability to pay dividends.

COVID-19 and measures to contain its spread have negatively impacted regional and global economies and trade patterns in markets in which we operate, the way we operate our business, and the businesses of our charterers and suppliers. For example, measures against COVID-19 in a number of countries had restricted crew rotations on our vessels, and those restrictions may recommence. In 2021 and 2022, we experienced disruptions to our normal vessel operations caused by increased deviation time associated with positioning our vessels to countries in which we can undertake a crew rotation in compliance with such measures. We have had increased expenses due to incremental fuel consumption and days in which our vessels were unable to earn revenue in order to deviate to certain ports on which we would ordinarily not call during a typical voyage. We have incurred additional expenses associated with testing, personal protective equipment, quarantines, and travel expenses such as airfare costs in order to perform crew rotations in the current environment. In 2021, 2022 and part of 2023, delays in crew rotations had also caused us to incur additional costs related to crew bonuses paid to retain the existing crew members on board and may continue to do so. We continue to focus on our employees’ well-being, whilst making sure that their operations continue undisrupted and at the same time, adapting to the new ways of operating. As such employees are encouraged, and in certain cases required, to operate remotely, this significantly increases the risk of cybersecurity attacks. 

Risks Related to Our Company

We may face liquidity issues if conditions in the dry bulk market worsen for a prolonged period and cause us to fail to comply with the terms of our debt agreements which could adversely affect our business, including our ability to refinance our indebtedness and pay dividends.

If the dry bulk shipping market declines over a prolonged period of time, we may have insufficient liquidity to fund ongoing operations or satisfy our obligations under our credit facilities, which may lead to a default under one or more of our credit facilities. In addition, our outstanding debt agreements impose on us certain operating and financial restrictions and require us or our subsidiaries to maintain various financial ratios. See “Item 5. Operating and Financial Review and Prospects –– B. Liquidity and Capital Resources –– Senior Secured Credit Facilities –– Credit Facility Covenants” for further details. Therefore, we may need to seek permission from our lenders in order to engage in certain corporate actions, which permission we may be unable to obtain. This may prevent us from taking actions that are in our best interest and from executing our business strategy and may limit our ability to pay dividends and finance our future operations. Further, a breach of any of the covenants in, or our inability to maintain the required financial ratios under, our debt agreements could result in a default thereunder. If a default occurs under our credit facilities, the lenders could elect to declare the outstanding debt, together with accrued interest and other fees, to be immediately due and payable and foreclose on the collateral securing that debt, which could constitute all or substantially all of our assets (considering the cross default provisions included in our debt agreements), which would have a material adverse effect on our business, results of operations and financial condition.

 

 17 
Table of Contents

 

An increase in the Secured Overnight Finance Rate could affect our earnings and cash flow.

We are exposed to market risk from changes in interest rates because obligations under our bank loans and lease financings bear interest at rates that fluctuate with the financial markets, and our interest expense is affected by changes in the general level of interest rates. As a result, a change in market interest rates could have an adverse effect on our earnings and cash flow. As of December 31, 2023, our obligations under our bank loans and lease financings bear interest at SOFR plus a margin. Between the start of 2022 and the end of 2023, SOFR increased from 0.05% to 5.38%. In order to manage our exposure to interest rate fluctuations under SOFR, we have and may from time to time use interest rate derivatives to effectively fix some of our 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. For additional information, see “Item 5. Operating and Financial Review and Prospects –– B. Liquidity and Capital Resources –– Senior Secured Credit Facilities.” 

We have considerable risks relating to the construction of our newbuilding vessels.

 

As of February 9, 2024, we had contracts for 5 newbuilding vessels. We expect to take delivery of two of these vessels in September 2025, another two in April 2026 and the last one in July 2026. Vessel construction projects are generally subject to risks of delay or cost overruns that are inherent in any large construction project, which may be caused by 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, unanticipated cost increases between order and delivery, design or engineering changes and work stoppages and other labor disputes, adverse weather conditions or any other events of force majeure. Significant cost overruns or delays could adversely affect our financial position, results of operations and cash flows. Additionally, failure to complete a project on time may result in the delay of revenue from that vessel, and we will continue to incur costs and expenses related to delayed vessels, such as supervision expense and interest expense for the outstanding debt.

 

As of February 9, 2024, the total payments for our 5 vessels under construction were expected to be $177.5 million, of which we had already paid $7.1 million. We expect to fund our remaining newbuilding commitments through credit facilities, the proceeds of equity and existing cash but may not be able to do so. There can be no assurance that we will be able to obtain such financings on a timely basis or on terms we deem reasonable or acceptable. If we are not able to borrow additional funds, raise other capital or utilize available cash on hand, we may not be able to acquire our vessels under construction, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. To the degree we raise equity financing to fund our capital expenditures, such equity raises may dilute the ownership of our existing shareholders and may be dilutive to our earnings per share. If for any reason we fail to make a payment when due, which may result in a default under our newbuilding contracts, or otherwise fail to take delivery of our vessels under construction, we would be prevented from realizing potential revenues from these vessels, we could also lose all or a portion of our yard payments that were paid by us and we could be liable for penalties and damages under such contracts.

 

We rely on our information systems to conduct our business, and failure to protect these systems against security breaches could adversely affect our business.

The safety and security of our vessels and efficient operation of our business, including processing, transmitting and storing electronic and financial information, depends on computer hardware and software systems, which are increasingly vulnerable to security breaches and other disruptions. Our vessels rely on information systems for a significant part of their operations, including navigation, provision of services, propulsion, machinery management, power control, communications and cargo management. We have in place safety and security measures on our vessels and onshore operations to secure our vessels against cybersecurity attacks and any disruption to their information systems. However, these measures and technology may not adequately prevent security breaches which are constantly evolving and have become increasingly sophisticated. If security threats are not recognized or detected until they have been launched, we may be unable to anticipate these threats and may not become aware in a timely manner of such a security breach, which could exacerbate any damage we experience. A disruption to the information system of any of our vessels could lead to, among other things, incorrect routing, collision, grounding and propulsion failure. Beyond our vessels, 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. In addition, the foregoing events could result in violations of applicable privacy and other laws. If confidential information is inappropriately accessed and used by a third-party or an employee for illegal purposes, we may be responsible to the affected individuals for any losses they may have incurred as a result of misappropriation. In such an instance, we may also be subject to regulatory action, investigation or liable to a governmental authority for fines or penalties associated with a lapse in the integrity and security of our information systems.

 

 18 
Table of Contents

 

We may be required to expend significant capital and other resources to protect against and remedy any potential or existing security breaches and their consequences. A cyber-attack could also lead to litigation, fines, other remedial action, heightened regulatory scrutiny and diminished customer confidence. In addition, our remediation efforts may not be successful, and we may not have adequate insurance to cover these losses. 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 have a material adverse effect on our business, results of operations, cash flows and financial condition. Moreover, cyber-attacks against the Ukrainian government and other countries in the region have been reported in connection with the conflicts between Russia and Ukraine. To the extent such attacks have collateral effects on global critical infrastructure or financial institutions or us, such developments could adversely affect our business, operating results and financial condition. At this time, it is difficult to assess the likelihood of such threat and any potential impact at this time. 

We are subject to certain risks with respect to our counterparties on contracts.

We have entered into, and may enter in the future into, various contracts, including charter parties and contracts of affreightment with our customers, newbuilding contracts with shipyards, credit facilities with our lenders and operating leases as charterers. These agreements subject us to counterparty risks. The ability of each of our counterparties to perform its obligations under a contract 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 maritime industry, the overall financial condition of the counterparty, charter rates received for specific types of vessels, and various expenses. Should our counterparties fail to honor their obligations under agreements with us, we could sustain significant losses, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We may not have adequate insurance to compensate us if we lose our vessels or they suffer significant damages or to compensate third parties for any damages to their property.

In the event of a casualty to a vessel or other catastrophic event, we rely on our insurance to pay the insured value of the vessel or the damages incurred. Through our management agreements with our technical managers, we procure insurance for the vessels in our fleet against those risks that we believe the shipping industry commonly insures against. This insurance includes marine hull and machinery insurance, protection insurance and indemnity insurance, which include pollution risks and crew insurances, and war risk insurance. Currently, the amount of coverage for liability for pollution, spillage and leakage available to us on commercially reasonable terms through protection and indemnity associations and providers of excess coverage is $1.0 billion per vessel per occurrence. We may not be adequately insured against all risks. We may not be able to obtain adequate insurance coverage for our fleet in the future, and we may not be able to obtain certain insurance coverages. The insurers may not pay particular claims. Our insurance policies may contain deductibles for which we will be responsible and limitations and exclusions which may increase our costs or lower our revenue. Moreover, insurers may default on claims they are required to pay. In addition, we may be subject to increased premium payments, or calls, in amounts based on our claim records and the claim records of our fleet managers as well as the claim records of other members of the protection and indemnity associations (P&I Associations) through which we receive insurance coverage for tort liability, including pollution-related liability. Our payment of these calls and any significant loss or liability for which we are not insured could have a material adverse effect on our business and financial condition.

 

 19 
Table of Contents

 

We depend upon third-party and/or affiliated managers to provide the technical management of our fleet.

We have contracted the technical management of certain portion of our fleet, including crewing, maintenance, and repair services, to third-party and/or affiliated technical management companies. The failure of these technical managers to perform their obligations could materially and adversely affect our business, results of operations, cash flows, financial condition and ability to pay dividends. Although we may have rights against our third-party and/or affiliated managers if they default on their obligations to us, our shareholders will share that recourse only indirectly to the extent that we recover funds.

The aging of our fleet and our practice of purchasing and operating secondhand vessels may result in increased operating costs and vessels off- hire, which could adversely affect our earnings.

Our current business strategy includes additional growth which may, in addition to the acquisition of newbuilding vessels, include the acquisition of modern secondhand vessels. While we expect that we would typically inspect secondhand vessels prior to acquisition, this does not provide us with the same knowledge about their condition that we would have had if these vessels had been built for and operated exclusively by us. Generally, we, as a purchaser of secondhand vessels will not receive the benefit of warranties from the builders for the secondhand vessels that we acquire. In addition, unforeseen maintenance, repairs, special surveys or dry docking may be necessary for acquired secondhand vessels, which could also increase our costs and reduce our ability to employ the vessel to generate revenue. In general, the cost of maintaining a vessel in good operating condition increases with the age of the vessel. As our vessels age, they will typically become less fuel-efficient and more costly to maintain than more recently constructed vessels due to improvements in engine technology. Cargo insurance rates increase with the age of a vessel, making older vessels less desirable to charterers. Governmental regulations and safety or other equipment standards related to the age of vessels may also require expenditures for alterations or the addition of new equipment to our vessels and may restrict the type of activities in which our vessels may engage. As our vessels age, market conditions may not justify those expenditures or may not enable us to operate our vessels profitably during the remainder of their useful lives. In addition, if new dry bulk carriers are built that are more efficient or more flexible or have longer physical lives than our vessels, competition from these more technologically advanced vessels could adversely affect the amount of charter hire payments we receive for our vessels once their initial charters expire and the resale value of our vessels could significantly decrease.

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.

From time to time we are involved in various litigation matters. These matters may include, among other things, contract disputes, shareholder litigation, personal injury claims, environmental claims or proceedings, asbestos and other toxic tort claims, property casualty 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 and/or insurers may not remain solvent which may have a material adverse effect on our financial condition.

 

 20 
Table of Contents

 

We may have difficulty managing our planned growth properly.

Historically, we have grown through acquisitions and building newbuilding vessels. One of our strategies is to continue expanding our operations and fleet. Our future growth will primarily depend upon a number of factors, some of which may not be within our control, including our ability to: identify suitable dry bulk carriers, including newbuilding slots at shipyards and/or shipping companies for acquisitions at attractive prices; obtain required financing for our existing and new operations; identify businesses engaged in managing, operating or owning dry bulk carriers for acquisitions or joint ventures; integrate any acquired dry bulk carriers or businesses successfully with our existing operations, including obtaining any approvals and qualifications necessary to operate vessels that we acquire; hire, train and retain qualified personnel and crew to manage and operate our growing business and fleet; identify new markets; enhance our customer base; and improve our operating, financial and accounting systems and controls. Our failure to effectively identify, acquire, develop and integrate any dry bulk carriers or businesses could adversely affect our business, financial condition and results of operations. The number of employees that perform services for us and our current operating and financial systems may not be adequate as we implement our plan to expand our fleet size in the dry bulk sector, and we may not be able to effectively hire more employees or adequately improve those systems. In addition, our growth through acquisitions and investments bears inherent risks including: the possibility that we may not receive a favorable return on our investments or that we may incur losses therefrom, or the original investment may become impaired; failure to satisfy or set effective strategic objectives; our assumption of known or unknown liabilities or other unanticipated events or circumstances, the diversion of management’s attention from normal daily operations of the business; difficulties in integrating the operations, technologies, products and personnel of an acquired company or its assets; difficulties in supporting acquired operations, difficulties or delays in the transfer of vessels, equipment or personnel; failure to retain key personnel, unexpected capital equipment outlays and related expenses; insufficient revenues to offset increased expenses associated with acquisitions; under-performance problems with acquired assets or operations, issuance of common shares that could dilute our current shareholders; recording of goodwill and non-amortizable intangible assets that will be subject to periodic impairment testing and potential impairment charges against our future earnings; the opportunity cost associated with committing capital in such investments; undisclosed defects, damage, maintenance requirements or similar matters relating to acquired vessels; and becoming subject to litigation.

We may not be able to address these risks successfully without substantial expense, delay or other operational or financial issues. Any delays or other such operations or financial issues could adversely impact our business, financial condition and results of operations. We cannot give any assurance that we will be successful in executing our growth plans, obtain appropriate financings on a timely basis or on terms we deem reasonable or acceptable or that we will not incur significant expenses and losses in connection with our future growth.

We may be unable to attract and retain qualified, skilled employees or crew necessary to operate our business.

Our success depends in large part on our ability to attract and retain highly skilled and qualified personnel, both shoreside personnel and crew. In crewing our vessels, we require technically skilled employees with specialized training who can perform physically demanding work. Competition to attract and retain qualified crew members and shoreside personnel is intense due to the increase in the size of the global shipping fleet. In addition, if we are not able to obtain higher charter rates to compensate for any crew cost and salary increases, or if we cannot hire, train and retain a sufficient number of qualified employees, we may be unable to manage, maintain and grow our business, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

 

 21 
Table of Contents

 

Risks Related to the Eagle Merger

The completion of the Eagle Merger is subject to a number of conditions and the Eagle Merger Agreement may be terminated in accordance with its terms. As a result, there is no assurance when or if the Eagle Merger will be completed.

The completion of the Eagle Merger is subject to the satisfaction or waiver of a number of conditions as set forth in the Eagle Merger Agreement. These include, among others, at or prior to the effective time, (a) the approval and authorization of the Eagle Merger Agreement and the Eagle Merger at the Eagle shareholders special meeting scheduled for April 5, 2024 (the “Eagle special meeting”) by the affirmative vote of holders of a majority of the outstanding shares of common stock of Eagle, $0.01 par value per share (“Eagle common stock”) entitled to vote thereon; (b) the approval of the proposal that holders of Eagle common stock (the “Eagle shareholders”) authorize and approve the issuance of shares of Eagle common stock issuable upon the potential future conversion of Eagle’s 5.00% Convertible Senior Notes due 2024 (the “convertible notes”) in excess of the conversion share cap set forth in the Indenture, dated as of July 29, 2019, between Eagle and Deutsche Bank Trust Company Americas (such proposal, the “convertible note share issuance proposal”) at the Eagle special meeting by the affirmative vote of a majority of the votes cast by holders of shares of Eagle common stock entitled to vote thereon; (c) no governmental entity of competent jurisdiction having entered, enacted, promulgated, enforced or issued any restraints preventing, making illegal or prohibiting the consummation of the Eagle Merger; (d) the expiration or termination of all applicable waiting periods (and extensions thereof) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act”) and the receipt of certain other approvals from applicable governmental entities; (e) the approval for listing of the common shares of Star Bulk, par value $0.01 per share (“Star Bulk common stock”) constituting the Eagle Merger consideration on Nasdaq, subject to official notice of issuance; (f) the accuracy of the representations and warranties contained in the Eagle Merger Agreement (subject to specified materiality qualifiers); (g) compliance with the pre-closing covenants and agreements in the Eagle Merger Agreement in all material respects; (h) the absence of a material adverse effect with respect to Eagle and Star Bulk; and (i) the delivery to Star Bulk or Eagle, as applicable, of a certificate signed on behalf of Eagle or Star Bulk, as applicable by a duly authorized executive officer of Eagle or Star Bulk, as applicable, certifying as to the satisfaction of the conditions described in (f) and (g) hereof. There can be no assurance as to when these conditions will be satisfied or waived, if at all, or that other events will not intervene to delay or result in the failure to close the merger.

In addition, if the Eagle Merger is not completed on or before the end date of September 11, 2024, either Star Bulk or Eagle may choose to terminate the Eagle Merger Agreement; provided, however, that the end date of September 11, 2024 may be extended by either Star Bulk or Eagle to a date not beyond December 11, 2024 if the only remaining condition to closing to be satisfied is the expiration or termination of the waiting period under the HSR Act or the receipt of certain approvals from applicable governmental entities. However, this right to terminate the Eagle Merger Agreement will not be available to Star Bulk or Eagle if such party has materially breached the Eagle Merger Agreement and the breach is the cause of or resulted in the failure of the Eagle Merger to be completed prior to the end date. Star Bulk or Eagle may elect to terminate the Eagle Merger Agreement in certain other circumstances, and Star Bulk and Eagle can mutually decide to terminate the Eagle Merger Agreement at any time prior to the effective time, before or after the required approval by the Eagle shareholders. If the Eagle Merger Agreement is terminated, Star Bulk may incur substantial fees in connection with the termination of the Eagle Merger Agreement and Star Bulk will not recognize the anticipated benefits of the Eagle Merger.

The pendency of the Eagle Merger could adversely affect our business, results of operations and financial condition.

Beginning at the time of the execution of the Eagle Merger Agreement and continuing until the Eagle Merger closes or the Eagle Merger Agreement is terminated in accordance with its terms, the pendency of the Eagle Merger could cause disruptions in and create uncertainty surrounding Star Bulk’s business, including affecting Star Bulk’s relationships with our existing and future customers, suppliers, partners in the business community and employees. This could have an adverse effect on Star Bulk’s business, results of operations and financial condition, as well as the market prices of our shares, regardless of whether the Eagle Merger is completed. Any adverse effect could be exacerbated by a prolonged delay in closing the Eagle Merger. Star Bulk could also potentially lose customers or suppliers, existing customers or suppliers may seek to change their existing business relationships or renegotiate their contracts with Star Bulk or defer decisions concerning Star Bulk, and potential customers or suppliers could defer entering into contracts with Star Bulk, each as a result of uncertainty relating to the Eagle Merger. In addition, in an effort to complete the Eagle Merger, Star Bulk has expended, and will continue to expend, significant management resources, which are being diverted from Star Bulk’s day-to-day operations, and significant demands are being, and will continue to be, placed on the managerial, operational and financial personnel and systems of Star Bulk in connection with efforts to complete the Eagle Merger. These foregoing risks related to the pendency of the Eagle Merger described above could also have an adverse effect on Eagle’s business, results of operations and financial condition. To the extent Eagle is adversely affected by such factors, Star Bulk may not realize all of the expected benefits of acquiring Eagle if and when the Eagle Merger closes.

 

 22 
Table of Contents

 

We have incurred and expect to incur expenses, transaction fees and costs in connection with the Eagle Merger and the integration of Eagle's and Star Bulk's respective businesses.

Star Bulk has incurred and expects to continue to incur additional expenses in connection with the Eagle Merger and the completion of the transactions contemplated by the Eagle Merger Agreement. Star Bulk has incurred significant legal, financial and other advisory services fees in connection with the process of negotiating and evaluating the terms of the Eagle Merger and will continue to incur significant costs, such as legal, accounting, financial advisory, filing and printing fees, prior to and in connection with the completion of the Eagle Merger.

We also expect to incur expenses to integrate a large number of processes, policies, procedures, operations, technologies and systems of Eagle and Star Bulk. The majority of these costs will be non-recurring expenses related to the transactions and facilities and systems consolidation costs. These incremental transaction-related costs may exceed the savings Star Bulk expects to achieve from the elimination of duplicative costs and the realization of other efficiencies related to the integration of the businesses, particularly in the near term and in the event, there are material unanticipated costs.

Irrespective of whether the Eagle Merger is completed, Star Bulk will need to pay certain costs relating to the Eagle Merger incurred prior to the date the Eagle Merger was abandoned, including legal, accounting, financial advisory, filing and printing fees. These costs could have an adverse effect on our future results of operations, cash flows and financial condition.

Uncertainties associated with the Eagle Merger may cause a loss of management personnel and other key employees, which could adversely affect our future business and operations following completion of the Eagle Merger.

Star Bulk is dependent on the experience and industry knowledge of our officers and other key employees to execute our business plans. Star Bulk’s success after the completion of the Eagle Merger will depend in part upon our ability to retain certain key management personnel and employees of Star Bulk and Eagle. Prior to the completion of the Eagle Merger, current and prospective employees of Eagle and Star Bulk may experience uncertainty about their roles following the completion of the transactions, which may have an adverse effect on our ability to attract or retain key management and other key personnel. In addition, no assurance can be given that Star Bulk, after the completion of the merger, will be able to attract or retain key management personnel and other key employees to the same extent that Star Bulk and Eagle have previously been able to attract or retain their own employees.

We and Eagle may be targets of shareholder class actions or derivative actions, which could result in substantial costs and may delay or prevent the Eagle Merger from being completed.

Shareholder class action lawsuits or derivative lawsuits are often brought against companies that have entered into merger agreements. Even if the lawsuits are without merit, defending against these claims can result in substantial costs and divert management time and resources. Additionally, if a plaintiff is successful in obtaining an injunction prohibiting consummation of the Eagle Merger, then that injunction may delay or prevent the Eagle Merger from being completed. One of the conditions to consummating the Eagle Merger is that no governmental entity has enacted or promulgated any statute, rule, regulation or law that prohibits or makes illegal the consummation of the Eagle Merger and that there is no order or injunction issued by any governmental entity in effect preventing the consummation of the Eagle Merger. Consequently, if a claimant secures injunctive or other relief prohibiting, delaying or otherwise adversely affecting Star Bulk’s or Eagle’s ability to complete the Eagle Merger on the terms contemplated by the Eagle Merger Agreement, then such law or injunctive or other relief may prevent consummation of the Eagle Merger in a timely manner or at all.

 

 23 
Table of Contents

 

If the completion of the Eagle Merger occurs, we may not realize all of the anticipated benefits of the Eagle Merger or those benefits may take longer to realize than expected. We may also encounter significant difficulties in integrating the two businesses.

Star Bulk anticipates that the Eagle Merger will generate significant annual cost and revenue synergies within 12-18 months after closing. However, there is a risk that some or all of the expected benefits of the Eagle Merger may fail to materialize, or may not occur within the anticipated time periods. The realization of the anticipated benefits may be affected by a number of factors, many of which will be beyond the control of Star Bulk. The challenge of combining previously independent businesses makes evaluating the business and future financial prospects of Star Bulk following the Eagle Merger difficult. Star Bulk and Eagle have operated and, until the completion of the Eagle Merger, will continue to operate, independently. The past financial performance of each of Star Bulk and Eagle may not be indicative of the future financial performance of Star Bulk following completion of the Eagle Merger. Realization of the anticipated benefits in the Eagle Merger will depend, in part, on the ability of Star Bulk and Eagle to successfully integrate their operations in an efficient and timely manner and without adversely affecting current revenues and investments in future growth.

Star Bulk will be required to devote significant management attention and resources to integrating its business practices and support functions, including aligning policies and internal controls of the two companies. The diversion of management’s attention and any delays or difficulties encountered in connection with the Eagle Merger and the subsequent coordination of the two companies’ operations could have an adverse effect on the business, financial results, financial condition or the share price of Star Bulk following the Eagle Merger. The coordination process may also result in additional and unforeseen expenses.

Our future results will suffer if we do not effectively manage our expanded operations following the Eagle Merger.

Our future success depends, in part, upon our ability to realize the anticipated benefits and cost savings from combining our and Eagle’s businesses, including the need to integrate the operations and business of Eagle into our existing business in an efficient and timely manner, to combine systems and management controls and to integrate relationships with customers, vendors, industry contacts and business partners.

The anticipated benefits and cost savings of the Eagle Merger may not be realized fully or at all, may take longer to realize than expected or could have other adverse effects that Star Bulk does not currently foresee. Some of the assumptions that Star Bulk has made, such as the achievement of operating synergies, may not be realized.

Risks Related to Taxation

A change in tax laws, treaties or regulations, or their interpretation could result in a significant negative impact on our earnings and cash flows from operations.

We are an international company that conducts business throughout the world. Tax laws and regulations are highly complex and subject to interpretation. Consequently, a change in tax laws, treaties or regulations, or in the interpretation thereof, or in and between countries in which we operate, could result in a materially high tax expense or higher effective tax rate on our worldwide earnings, and such change could be significant to our financial results. If any tax authority successfully challenges our operational structure, intercompany pricing policies or the taxable presence of our key subsidiaries in certain countries, or if the terms of certain income tax treaties are interpreted in a manner that is adverse to our structure, or if we lose a material tax dispute in any country, our effective tax rate on our worldwide earnings from our operations could increase substantially and our earnings and cash flows from these operations could be materially adversely affected. We and our subsidiaries may be subject to taxation in the jurisdictions in which we and our subsidiaries conduct business. Such taxation would result in decreased earnings. Investors are encouraged to consult their own tax advisors concerning the overall tax consequences of the ownership of our common shares arising in an investor’s particular situation under U.S. federal, state, local and foreign law.

 24 
Table of Contents

 

The Internal Revenue Service could treat us as a “passive foreign investment company,” (or “PFIC”) which could have adverse U.S. federal income tax consequences to U.S. shareholders.

As further described under “Item 10. Additional Information –– E. Taxation –– U.S. Federal Income Taxation of U.S. Holders” we believe that we currently are not a PFIC, and we do not expect to become a PFIC in the future. However, there is no direct legal authority under the PFIC rules addressing our characterization of income from our voyage and time chartering activities nor our characterization of contracts for newbuilding vessels, if any. Moreover, the determination of PFIC status for any year can only be made on an annual basis after the end of such taxable year and will depend on the composition of our income, assets and operations from time to time. Because of the above described uncertainties, there can be no assurance that the Internal Revenue Service will not challenge the determination made by us concerning our PFIC status or that we will not be a PFIC for any taxable year. If we were classified as a PFIC for any taxable year during which a U.S. shareholder owns common shares (regardless of whether we continue to be a PFIC), the U.S. shareholder would be subject to special adverse rules, including taxation at maximum ordinary income rates plus an interest charge on both gains on sale and certain dividends, unless the U.S. shareholder makes an election to be taxed under an alternative regime. Certain elections may be available to U.S. shareholders if we were classified as a PFIC.

Changes in tax laws and unanticipated tax liabilities could materially and adversely affect the taxes we pay, results of operations and financial results.

We are subject to income and other taxes in the United States and foreign jurisdictions, and our results of operations and financial results may be affected by tax and other initiatives around the world. For instance, there is a high level of uncertainty in today’s tax environment stemming from global initiatives put forth by the Organisation for Economic Co-operation and Development’s (“OECD”) two-pillar base erosion and profit shifting project. In October 2021, members of the OECD put forth two proposals: (i) Pillar One reallocates profit to the market jurisdictions where sales arise versus physical presence; and (ii) Pillar Two compels multinational corporations with €750 million or more in annual revenue to pay a global minimum tax of 15% on income received in each country in which they operate. The reforms aim to level the playing field between countries by discouraging them from reducing their corporate income taxes to attract foreign business investment. Over 140 countries agreed to enact the two-pillar solution to address the challenges arising from the digitalization of the economy and, in 2024, these guidelines were declared effective and must now be enacted by those OECD member countries. It is possible that these guidelines, including the global minimum corporate tax rate measure of 15%, could increase the burden and costs of our tax compliance, the amount of taxes we incur in those jurisdictions and our global effective tax rate, which could have a material adverse impact on our results of operations and financial results.

Risks Related to Our Relationships with Mr. Pappas, Oaktree and Other Parties

Affiliates of Oaktree are the largest shareholder of our common shares, subject to certain restrictions on voting, acquisitions and dispositions thereof.

As of February 9, 2024, Oaktree and its affiliates beneficially own 6,107,983 common shares, representing approximately 7.3% of our outstanding common shares. However, pursuant to the Oaktree Shareholders Agreement, Oaktree and certain affiliates thereof have agreed to certain voting restrictions. See “Item 7. Major Shareholders and Related Party Transactions –– B. Related Party Transactions –– Oaktree Shareholders Agreement” for further details. Additionally, Oaktree is in the business of making investments in companies. If Oaktree pursues acquisitions or makes further investments in the shipping industry, those acquisitions and investment opportunities may not be available to us, and we have agreed to renounce any interest or expectancy in, or in being offered an opportunity to participate in, any corporate opportunities that may be presented to or become known to Oaktree or any of its affiliates. In addition, the member of the Board of Directors (“Board of Directors”) nominated by Oaktree will have fiduciary duties to us and in addition may have duties to Oaktree. As a result, such circumstances may entail real or apparent conflicts of interest with respect to matters affecting both us and Oaktree, whose interests, in some circumstances, may be adverse to ours. 

Members of management and our directors may have relationships and affiliations with other entities that could create conflicts of interest.

While we do not expect our Chief Executive Officer, Mr. Petros Pappas, will have any material relationships with any companies in the dry bulk shipping industry other than us, he will continue to be involved in other areas of the shipping industry, which could cause conflicts of interest not in the best interest of us or our shareholders. This could result in an adverse effect on our business, financial condition, results of operations and cash flows. We use our best efforts to ensure compliance with all applicable laws and regulations in addressing such conflicts of interest. In addition, our executive officers participate in business activities not associated with us, including serving as members of the management teams of Oceanbulk Maritime S.A, a dry cargo shipping company, and PST Tankers LLC, a joint venture between Oaktree and entities controlled by Mr. Pappas’ family involved in the product tanker businesses, and are not required to work full-time on our affairs. Initially, we expect that each of our executive officers will devote a substantial portion of his/her business time to the management of our Company.

 

 25 
Table of Contents

 

Our executive officers may devote less time to us than if they were not engaged in other business activities and may owe fiduciary duties to the shareholders of other companies with which they may be affiliated, including those companies listed above. One of our directors is affiliated with Oaktree. Our Oaktree-affiliated director has fiduciary duties to us and to Oaktree. In addition, under the Oaktree Shareholders Agreements, none of our officers or directors who is also an officer, director, employee or other affiliate of Oaktree or an officer, director or employee of an affiliate of Oaktree will be liable to us or our shareholders for breach of any fiduciary duty by reason of the fact that any such individual directs a corporate opportunity to Oaktree or its affiliates instead of us, or does not communicate information regarding a corporate opportunity to us that such person or affiliate has directed to Oaktree or its affiliates. As a result, such circumstances may entail real or apparent conflicts of interest with respect to matters affecting both us and Oaktree, whose interests, in some circumstances, may be adverse to ours. In addition, as a result of Oaktree’s ownership interest, conflicts of interest could arise with respect to transactions involving business dealings between us and Oaktree or their affiliates, including potential business transactions, potential acquisitions of businesses or properties, the issuance of additional securities, the payment of dividends by us and other matters. This structure may create conflicts of interest in matters involving or affecting us and our customers and it is not certain that any of these conflicts of interest will be resolved in our favor. This could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Risks Related to Our Corporate Structure and Our Common Shares

We are a holding company and depend on the ability of our subsidiaries to distribute funds to us in order to satisfy our financial obligations and to make dividend payments.

We are a holding company, and our subsidiaries conduct all of our operations and own all of our operating assets. We have no significant assets other than the equity interests in our subsidiaries. Our ability to satisfy our financial obligations and to make dividend payments in the future depends on our subsidiaries and their ability to distribute funds to us. If we are unable to obtain funds from our subsidiaries, our Board of Directors may exercise its discretion not to declare or pay dividends. We do not intend to obtain funds from other sources to pay dividends. Furthermore, certain of our outstanding financing arrangements restrict the ability of some of our subsidiaries to pay us dividends under certain circumstances, such as if an event of default exists.

We may need to raise additional capital in the future, which may not be available on favorable terms or at all or which may dilute our common stock or adversely affect its market price.

We may require additional capital to expand our business and increase revenues, add liquidity in response to negative economic conditions, meet unexpected liquidity needs, and reduce our outstanding debt. To the extent our existing capital and borrowing capabilities are insufficient, we will need to raise additional funds through debt or equity financings, including offerings of our common stock, securities convertible into our common stock, or rights to acquire our common stock or curtail our growth and reduce our assets or restructure arrangements with existing security holders. Any equity or debt financing, or additional borrowings, if available at all, may be on terms that are not favorable to us. Equity financings could result in dilution to our stockholders, and the securities issued in future financings may have rights, preferences, and privileges that are senior to those of our common stock. To the extent that an existing shareholder does not purchase shares of voting stock, that shareholder’s interest in our Company will be diluted, representing a smaller percentage of the vote in our Board of Directors’ elections and other shareholder decisions. If our need for capital arises because of significant losses, the occurrence of these losses may make it more difficult for us to raise the necessary capital. If we cannot raise funds on acceptable terms if and when needed, we may not be able to take advantage of future opportunities, grow our business or respond to competitive pressures or unanticipated requirements.

 

 26 
Table of Contents

 

Our financing arrangements impose a number of restrictions on our ability to pay dividends, and we may not be able to pay dividends even though we have an established dividend policy.

Under the terms of a number of our outstanding financing arrangements, we are subject to various restrictions on our ability to pay dividends. Our financing arrangements prevent us from paying dividends if an event of default exists under our credit facilities or if certain financial ratios are not met. See “Item 5. Operating and Financial Review and Prospects –– B. Liquidity and Capital Resources –– Senior Secured Credit Facilities –– Credit Facility Covenants” for further details. In general, when dividends are paid, they are distributed from our operating surplus, in amounts that allow us to retain a portion of our cash flows to fund vessel or fleet acquisitions and for debt repayment and other corporate purposes, as determined by our management and Board of Directors. See “Item 8. Financial Information –– A. Consolidated statements and other financial information — Dividend Policy” for further details. In addition, the declaration and payment of dividends, if any, will be subject at all times to the discretion of our Board of Directors. The timing and amount of dividends, if any, will depend on our earnings, financial condition, cash requirements and availability, fleet renewal and expansion, restrictions in our loan agreements, if any, the provisions of Marshall Islands law affecting the payment of dividends, future changes in our dividend policy, and other factors, many of which may be beyond our control. Furthermore, the dry bulk shipping industry is volatile, and we cannot predict with certainty the amount of cash, if any, that will be available for distribution as dividends in any period. In addition, any new shares of common stock issued will increase the cash required to pay future dividends.

The laws of the Republic of Marshall Islands generally prohibit the payment of dividends other than from surplus (retained earnings and the excess of consideration received for the sale of shares above the par value of the shares), or if there is no surplus, from the net profits for the current and prior fiscal year, or while a company is insolvent or would be rendered insolvent by the payment of such a dividend. We may not have sufficient surplus or net profits in the future to pay dividends and our subsidiaries may not have sufficient funds or surplus to make distributions to us. We can give no assurance that dividends will be paid at any level or at all.

Our reliance upon “foreign private issuer” exemptions may afford less protection to holders of our common shares.

Nasdaq Global Select Market’s (“Nasdaq”) corporate governance rules require, subject to exceptions, listed companies to have, among other things, a majority of their board members be independent and independent director oversight of executive compensation, nomination of directors and corporate governance matters. As a “foreign private issuer” as defined in Rule 3b-4 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or FPI, we may follow the laws of the Republic of the Marshall Islands, our home country, with respect to the foregoing requirements. For example, although our Board of Directors currently includes nine members who would likely be deemed independent under the Nasdaq rules, we may in the future have less than a majority of directors who would be deemed independent, as permitted under Marshall Islands law. In addition, as a FPI we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act applicable to U.S. domestic companies whose securities are registered under the Exchange Act.

Because we are organized under the laws of the Marshall Islands and because substantially all of our assets are located outside of the United States, it may be difficult to serve us with legal process or enforce judgments against us, our directors or our management.

We are organized under the laws of the Marshall Islands and substantially all of our assets are located outside of the United States. In addition, the majority of our directors and officers are or will be non-residents of the United States and all or a substantial portion of the assets of these non- residents are located outside of the United States. As a result, it may be difficult or impossible for you to bring an action against us or against our directors and officers in the United States if you believe that your rights have been infringed under securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Marshall Islands and of other jurisdictions may prevent or restrict you from enforcing a judgment against our assets or the assets of our directors or officers.

 

 27 
Table of Contents

 

We are incorporated in the Marshall Islands, which does not have a well-developed body of corporate law.

Our corporate affairs are governed by our Fourth Amended and Restated Articles of Incorporation (the “Articles of Incorporation”) and our Third Amended and Restated Bylaws (the “Bylaws”) and by the Marshall Islands Business Corporations Act (the “MIBCA”). The provisions of the MIBCA resemble provisions of the corporation laws of a number of states in the United States. However, there have been few judicial cases in the Marshall Islands interpreting the MIBCA. The rights and fiduciary responsibilities of directors under the laws 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 the United States. The rights of shareholders of companies incorporated in the Marshall Islands may differ from the rights of shareholders of companies incorporated in the United States. While the MIBCA 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 MIBCA in the Marshall Islands and we cannot predict whether Marshall Islands courts would reach the same conclusions as United States courts. Thus, you may have more difficulty in protecting your interests in the face of actions by the management, directors or controlling shareholders than would shareholders of a corporation incorporated in a United States jurisdiction that has developed a relatively more substantial body of case law. 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, any bankruptcy action involving our Company would have to be initiated outside of the Marshall Islands, and our shareholders and creditors may experience delays in their ability to recover their claims after any such insolvency or bankruptcy.

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

We are incorporated under the laws of the Republic of the Marshall Islands and certain of our subsidiaries are also incorporated under the laws of the Republic of the Marshall Islands, Liberia, British Virgin Islands, Cyprus, Singapore and Germany, and we conduct operations in countries around the world.

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 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.

As a Marshall Islands corporation and with some of our subsidiaries being Marshall Islands entities and also having subsidiaries in other offshore jurisdictions, our operations may be subject to economic substance requirements, which could impact our business.

We are a Marshall Islands corporation and some of our subsidiaries are Marshall Islands entities. The Marshall Islands has enacted economic substance laws and regulations with which we may be obligated to comply. We believe that we and our subsidiaries are compliant with the Marshall Islands economic substance requirements. However, if there were a change in the requirements or interpretation thereof, or if there were an unexpected change to our operations, any such change could result in noncompliance with the economic substance legislation and related fines or other penalties, increased monitoring and audits, and dissolution of the non-compliant entity, which could have an adverse effect on our business, financial condition or operating results.

EU Finance ministers rate jurisdictions for tax rates and tax transparency, governance and real economic activity. Countries that are viewed by such finance ministers as not adequately cooperating, including by not implementing sufficient standards in respect of the foregoing, may be put on a “grey list” or a “blacklist”. Effective as of October 17, 2023 the Marshall Islands has been designated as a cooperating jurisdiction for tax purposes.  If the Marshall Islands is added to the list of non-cooperative jurisdictions in the future and sanctions or other financial, tax or regulatory measures were applied by European Member States to countries on the list or further economic substance requirements were imposed by the Marshall Islands, our business could be harmed.

Future sales of our common shares could cause the market price of our common shares to decline.

Our Articles of Incorporation authorize us to issue 300,000,000 common shares, of which 84,016,892 shares were issued and outstanding as of December 31, 2023. In addition, certain shareholders hold registration rights, see “Item 7. Major Shareholders and Related Party Transactions –– A. Major Shareholders.” Furthermore, pursuant to our two currently effective, At-the-Market offering programs, we may offer and sell a number of our common shares, having an aggregate offering price of up to $150.0 million at any time and from time to time. As of December 31, 2023, cumulative gross proceeds under our At-the-Market offering programs were $33.6 million. Sales of a substantial number of our common shares in the public market, or the perception that these sales could occur, may depress the market price for our common shares. These sales could also impair our ability to raise additional capital through the sale of our equity securities in the future. We intend to issue additional common shares in the future. Our shareholders may incur dilution from any future equity offering and upon the issuance of additional common shares pursuant to our equity incentive plans.

 

 28 
Table of Contents

 

We may fail to meet the continued listing requirements of Nasdaq, which could cause our common shares to be delisted.

There can be no assurance that we will remain in compliance with Nasdaq’s listing qualification rules, or that our common shares will not be delisted, which could have an adverse effect on the market price of, and the efficiency of the trading market for, our common shares and could cause a default under certain senior secured credit facilities.

The price of our common shares may be highly volatile.

The price of our common shares may fluctuate due to factors such as: actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry; mergers and strategic alliances in the dry bulk shipping industry; market conditions in the dry bulk shipping industry; changes in market valuations of companies in our industry; changes in government regulation; the failure of securities analysts to publish research about us, or shortfalls in our operating results from levels forecast by securities analysts; announcements concerning us or our competitors; and the general state of the securities markets. Hence, the market for our common shares may be unpredictable and volatile. Further, there may be no continuing active or liquid public market for our common shares. Consequently, you may not be able to sell the common shares at prices equal to or greater than those paid by you, or you may not be able to sell them at all. In the past, following periods of volatility in the market, securities class-action litigation has often been instituted against companies. Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects. There can be no guarantee that our stock price will remain at current levels.

Anti-takeover provisions in our organizational documents could have the effect of discouraging, delaying or preventing a merger or acquisition, or could make it difficult for our shareholders to replace or remove our current Board of Directors, which could adversely affect the market price of our common shares.

Several provisions of our Articles of Incorporation and our Bylaws 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 management. In addition, the same provisions may discourage, delay or prevent a merger or acquisition that shareholders may consider favorable. These provisions include: authorizing our Board of Directors to issue “blank check” preferred stock without shareholder approval; providing for a classified Board of Directors with staggered, three-year terms; establishing certain advance notice requirements for nominations for election to our Board of Directors or for proposing matters that can be acted on by shareholders at shareholder meetings; prohibiting cumulative voting in the election of directors; limiting the persons who may call special meetings of shareholders; authorizing the removal of directors only for cause and only upon the affirmative vote of the holders of a majority of our outstanding common shares entitled to vote for the directors; and establishing supermajority voting provisions with respect to amendments to certain provisions of our Articles of Incorporation and our Bylaws. These anti-takeover provisions 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 your ability to realize any potential change of control premium.

 

 29 
Table of Contents

 

Item 4.Information on the Company

A.       History and Development of the Company

Star Bulk Carriers Corp. was incorporated in the Marshall Islands on December 13, 2006. Our executive offices are located at c/o Star Bulk Management Inc., 40 Agiou Konstantinou Str., Maroussi 15124, Athens, Greece and its telephone number is 011-30-210-617-8400. Our registered office is located at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH 96960. The name of our registered agent at such address is The Trust Company of the Marshall Islands, Inc.

Eagle Merger Agreement

On December 11, 2023, we entered into the Eagle Merger Agreement with Eagle, pursuant to which the Company and Eagle have agreed, subject to the terms and conditions of the Eagle Merger Agreement, to effect a stock-for-stock merger whereby Merger Sub will merge with and into Eagle, resulting in Eagle surviving the merger as a wholly owned subsidiary of the Company. Subject to the terms and conditions set forth in the Eagle Merger Agreement, at the effective time of the Eagle Merger (the “Effective Time”), each share of Eagle common stock issued and outstanding immediately prior to the Effective Time (excluding Eagle common stock owned by Eagle, the Company, Merger Sub or any of their respective direct or indirect wholly owned subsidiaries) will be converted into the right to receive 2.6211 common shares, par value $0.01 per share, of Star Bulk common stock. Upon the consummation of the Eagle Merger, and after taking into account the shares underlying existing Eagle equity awards and the shares expected to be issued upon the conversion of the convertible notes, Star Bulk shareholders will own approximately 71% of the outstanding shares of Star Bulk common stock and Eagle Bulk shareholders will own approximately 29% of the outstanding shares of Star Bulk common stock on a fully diluted basis.

The completion of the Eagle Merger is subject to, among other closing conditions, the satisfaction or waiver of certain conditions, including (i) the approval and authorization of the Eagle Merger Agreement and the Eagle Merger by the affirmative vote of the holders of a majority of all outstanding shares of Eagle common stock entitled to vote thereon; (ii) the approval of the convertible note share issuance proposal at the Eagle special meeting by the affirmative vote of a majority of the votes cast by the holders of shares of Eagle common stock entitled to vote thereon and (iii) the expiration or termination of the waiting period under the HSR Act, as amended, and the receipt of certain other governmental approvals. The obligation of each of Eagle and Star Bulk to consummate the Eagle Merger is also conditioned on, among other things, the truth and correctness of the representations and warranties made by the other party as of the closing date (subject to certain “materiality” and “material adverse effect” qualifiers), material compliance by the other party with pre-closing covenants, and the absence of a material adverse effect with respect to each party.

On January 19, 2024, we filed with the United States Securities and Exchange Commission (the “SEC”) a registration statement on Form F-4 (the “F-4”), which was amended on February 8, 2024 and declared effective on February 12, 2024, with respect to the shares of Star Bulk Common Stock to be issued to Eagle shareholders pursuant to the Eagle Merger Agreement. The F-4 included a proxy statement of Eagle under Section 14(a) of the Securities Exchange Act of 1934, as amended, and a notice of meeting with respect to the Eagle special meeting, at which Eagle shareholders will be asked to consider and vote upon the Eagle Merger proposal and certain other proposals. The board of directors of Eagle fixed the close of business on February 12, 2024 as the record date for the determination of Eagle shareholders entitled to notice of, and to vote at, the Eagle special meeting. The Eagle special meeting will be held on April 5, 2024.

The Eagle Merger is expected to close in the first half of 2024, subject to the satisfaction or waiver of the closing conditions. For additional information, see “Item 10. Additional Information –– C. Material Contracts –– Eagle Merger Agreement”.

 

 30 
Table of Contents

 

Significant Changes to Our Fleet During the Years 2023-2024

In October 2023 we entered into four shipbuilding contracts with Qingdao Shipyard Co., Ltd. for the construction of four 82,000 dwt Kamsarmax newbuilding vessels. In addition, in November 2023 we entered into an additional firm shipbuilding contract with Qingdao Shipyard Co., Ltd. for the construction of another 82,000 dwt Kamsarmax newbuilding vessel. We expect to take delivery of two of these vessels in September 2025, another two in April 2026 and the last one in July 2026.

From time to time, in response to changing market conditions, we have disposed certain of our vessels (the majority of which were older vessels). As a result, we currently have a fleet of 112 vessels, with an aggregate capacity of 12.5 million dwt, consisting of Newcastlemax, Capesize, Post Panamax, Kamsarmax, Panamax, Ultramax and Supramax vessels with carrying capacities between 53,489 dwt and 209,537 dwt.

We are subject to the informational requirements of the Exchange Act. In accordance with these requirements, we file reports and other information as a foreign private issuer with the SEC. You may obtain copies of all or any part of such materials from the SEC upon payment of prescribed fees. You may also inspect reports and other information regarding registrants, such as us, that file electronically with the SEC without charge at a website maintained by the SEC at http://www.sec.gov. These documents and other important information on our governance are posted on our website and may be viewed at https://www.starbulk.com. The information contained on or connected to our website is not part of this annual report.

B.       Business Overview

We are a leading global shipping company that owns and operates a modern and diverse fleet of dry bulk vessels. Our vessels transport a broad range of major and minor bulk commodities, including iron ore, minerals and grain, bauxite, fertilizers and steel products, along worldwide shipping routes. Our executive management team, which has extensive shipping industry expertise, is led by Mr. Petros Pappas, who has long-standing shipping experience and has managed hundreds of vessel acquisitions and dispositions.

We are committed to integrating Environmental, Social and Governance (“ESG”) practices into our operational and strategic decision making within the scope of our vision to be a leader in sustainable dry bulk shipping. In this respect we are a signatory to the United Nations (UN) Global Compact supporting its Ten Principles on areas of human rights, labor, environment and anticorruption and committing to the broader Sustainable Development Goals of the United Nations. In addition, we publish an annual ESG Report, which presents our ESG strategy and goals, identifies ESG related risks, and reports on our ESG performance across all our business operations. In October 2023, we released our fifth annual ESG Report. All of our ESG Reports may be found on our website at www.starbulk.com. The information contained on or connected to our website is not part of this annual report.

Our ESG Performance:

Environment

We endeavor to comply with all applicable environmental regulations timely and efficiently and implement measures to improve our environmental performance, protect the marine environment and reduce our carbon footprint.

We have retrofitted our fleet with Exhaust Gas Cleaning Systems (“EGCS”), in order to comply with the sulfur emissions standards, titled IMO- 2020, set by the International Maritime Organization, the United Nations agency for maritime safety and the prevention of pollution by vessels (the “IMO”).

 

 31 
Table of Contents

 

We have implemented a retrofit program across our entire fleet to comply with the IMO’s Ballast Water Management Convention.
In accordance with the scope of the GHG strategy set for 2030 and 2050 by the IMO, we monitor the performance of our vessels through telemetry and advanced data management systems and take action to improve the energy efficiency of our fleet both operationally and technically.
We participate in the Poseidon Principles, which establish a framework for assessing and disclosing the climate alignment of ship finance portfolios and are consistent with the policies and ambitions of the IMO to achieve net zero GHG emissions by or around 2050.
We collaborate with our charterers within the scope of the Sea Cargo Charter, providing them with our vessel data to enable them to assess and report on the carbon intensity of the chartering activities of these vessels.
We have engaged and actively participate in partnerships and alliances that promote sustainability in the maritime sector, including emission control and other environmental initiatives, such as the Global Maritime Forum, the Getting to Zero Coalition, the Clean Shipping Alliance, and the Hellenic Marine Environment Protection Association.
In collaboration with our major charterers, we participate in the development of an iron ore Green Corridor between West Australia and East Asia, which aims to decarbonize this trade route through the deployment of clean ammonia-fueled vessels.
We are active participants in several projects for the development and/or deployment of new green technologies and alternative fuels, including with respect to:

 

§the adoption of various latest technology voyage optimization platforms which aim to reduce fuel consumption and therefore our fleet’s CO2 footprint;
§the installation of energy-saving devices, such as propeller ducts, which aim to reduce the required propulsion power and CO2 emissions of our vessels;
§piloting and evaluating latest technology anti-fouling paints and hull cleaning technologies to reduce hull resistance and improve vessel’s energy efficiency;
§the techno-economic feasibility assessment of several zero-emission fuels, including biofuels and green-hydrogen derived fuels such as methanol and ammonia;
§onboard carbon capture technologies, leveraging also our existing exhaust gas cleaning systems; and
§the testing of advanced wash-water filtration system onboard our vessels to enable the removal of micro-plastics from port waters.

 32 
Table of Contents

 

Social

We are focused on continuously improving our social impact, including with respect to the health, safety and wellbeing of employees, both on board and ashore, to operational excellence, and to community support.

The health, safety, security and well-being of our people at sea and on shore is our top priority, especially with respect to COVID-19, the conflict between Russia and Ukraine, the conflict between Israel and Hamas and the Houthi seizures and attacks in the Red Sea and the Gulf of Aden. For more information, please visit our ESG Report, which may be found on our website at www.starbulk.com. The information contained on or connected to our website is not part of this annual report. We are a signatory to the Neptune Declaration on Seafarer Wellbeing, which promotes the health and safety of seafarers. We are also signatories of the Gulf of Guinea Declaration on Suppression of Piracy.
We are dedicated to providing equal employment opportunities and treating our people fairly without regard to race, color, religious beliefs, age, sex, or any other classification.
We maintain high retention rates both on board and ashore and work to facilitate the professional development, continuous training and career advancement of our people.
We are implementing employee well-being programs, which include but are not limited to flexible working schemes, psychological support services, professional coaching and employee engagement activities.

We are consistently among the top ranked dry bulk operators globally in the RightShip Safety Score.

Our community investment activities focus on, but are not limited to, supporting vulnerable groups, sports and youth education in Greece. In 2023, we contributed to the Union of Greek Shipowners’ efforts to support the Thessaly community which suffered severe damages from floods in the region.

Governance

We endeavor to apply corporate governance best practices, adhere to strong ethical principles and ensure the high commercial performance of our fleet.

·The Company is governed by a diverse and experienced, majority independent Board of Directors.
·In 2023, we enhanced our Code of Business Ethics and Anti-Corruption Policy to address the new Global Standard Reporting Standards, the company’s ESG Commitments and the UN Global Compact Principles.
·We implement rigorous internal controls structured to ensure robust risk management practices.
·We continuously cultivate an open reporting culture both in our offices and on board our vessels.
·The Company’s ESG Committee at the Board level provides guidance and oversight with regards to the company’s ESG strategy.
·We deploy advanced Enterprise Resource Planning and Business Intelligence systems to enable lean operations and efficient decision making, and are continuously upgrading and enhancing our cybersecurity systems, processes and policies, both in the office and on our vessels, to safeguard the Company from cyber risks.

 

 33 
Table of Contents

 

Our Fleet

We have built a fleet through timely and selective acquisitions of secondhand vessels and vessels under construction. We believe our fleet is well-positioned to take advantage of economies of scale in commercial, technical and procurement management. We have a large, modern, fuel-efficient and high-quality fleet, which emphasizes the largest Eco-type Capesize and Newcastlemax vessels, built at leading shipyards and featuring the latest technology. As a result, we believe we will have an opportunity to capitalize on rising market demand during a period of reduced fleet growth, customer preferences for our ships and economies of scale, while enabling us to capture the benefits of fuel cost savings through spot time charters or voyage charters.

The majority of our operating fleet is equipped with a vessel remote monitoring system that provides data to monitor fuel and lubricant consumption and efficiency on a real-time basis. While these monitoring systems are generally available in the shipping industry, we believe that they can be cost-effectively employed only by large-scale shipping operators, such as us.

In addition, pursuant to the IMO sulfur cap regulations, which limited emission to 0.5% m/m sulfur content and came into force in January 2020, we decided to install scrubbers on the vast majority of our vessels (“Scrubber Retrofitting Program”). As of the date of this annual report, we have successfully completed the installation of scrubbers on 108 vessels out of the 112 vessels in our fleet. We believe that the new maritime regulations will have a strong impact on the maritime industry and will distinguish us from other dry bulk owners that will have conventional dry bulk vessels that will not be able to consume less expensive bunker fuel with higher sulfur content. We believe installation of scrubbers has increased and will continue to increase our competitive advantage commercially making our fleet more attractive to charterers and cargo owners.

Furthermore, we are actively investing in reducing the carbon emissions of our vessels using a variety of technologies such as hull cleaning robots, voyage optimization software, low friction paints, variable frequency drivers for engine room fans and sea water cooling pumps and installation of Energy Saving Devices (“ESD”) (mainly Mewis ducts and Propeller boss cap fins) on our vessels. As of the date of this report, we have completed the installation of 31 ESD on our vessels and we have planned for another 16 vessels to be equipped with such devices in 2024. We also actively research the retrofitting of shaft generators and exhaust gas economizers for the vessels’ diesel generators and expect to complete the first applications of such technology in 2024.

Our vessels under construction meet the latest requirements of Energy Efficiency Design Index (EEDI Phase 3) in relation to carbon dioxide (CO2) intensity and comply with the latest NOX regulations, NOX TIER III. In addition, these vessels are fitted with the latest available and most fuel-efficient main engine produced by MAN B&W, a shaft generator and Alternate Marine Power optionality, all of which help to ensure best-in-class daily fuel consumption and emissions reductions.

 

 34 
Table of Contents

 

The following tables summarize key information about our operating fleet, as of the date of this annual report:

 

Operating Fleet

        Date  
  Wholly Owned Subsidiaries Vessel Name DWT Delivered to Star Bulk Year Built
1 Sea Diamond Shipping LLC Goliath 209,537 July 15, 2015 2015
2 Star Ennea LLC Star Gina 2GR 209,475 February 26, 2016 2016
3 Coral Cape Shipping LLC Maharaj 209,472 July 15, 2015 2015
4 Pearl Shiptrade LLC Gargantua 209,529 April 2, 2015 2015
5 Star Castle II LLC Star Leo 207,939 May 14, 2018 2018
6 ABY Eleven LLC Star Laetitia 207,896 August 3, 2018 2017
7 Domus Shipping LLC Star Ariadne 207,812 March 28, 2017 2017
8 Star Breezer LLC Star Virgo 207,810 March 1, 2017 2017
9 Star Seeker LLC Star Libra 207,765 June 6, 2016 2016
10 ABY Nine LLC Star Sienna 207,721 August 3, 2018 2017
11 Clearwater Shipping LLC Star Marisa 207,709 March 11 2016 2016
12 ABY Ten LLC Star Karlie 207,566 August 3, 2018 2016
13 Star Castle I LLC Star Eleni 207,555 January 3, 2018 2018
14 Festive Shipping LLC Star Magnanimus 207,526 March 26, 2018 2018
15 New Era II Shipping LLC Debbie H 206,861 May 28, 2019 2019
16 New Era III Shipping LLC Star Ayesha 206,852 July 15, 2019 2019
17 New Era I Shipping LLC Katie K 206,839 April 16, 2019 2019
18 Cape Ocean Maritime LLC Leviathan 182,511 September 19, 2014 2014
19 Cape Horizon Shipping LLC Peloreus 182,496 July 22, 2014 2014
20 Star Nor I LLC Star Claudine 181,258 July 6, 2018 2011
21 Star Nor II LLC Star Ophelia 180,716 July 6, 2018 2010
22 Sandra Shipco LLC Star Pauline 180,274 December 29, 2014 2008
23 Christine Shipco LLC Star Martha 180,274 October 31, 2014 2010
24 Star Nor III LLC Star Lyra 179,147 July 6, 2018 2009
25 Star Regg V LLC Star Borneo 178,978 January 26, 2021 2010
26 Star Regg VI LLC Star Bueno 178,978 January 26, 2021 2010
27 Star Regg IV LLC Star Marilena 178,978 January 26, 2021 2010
28 Star Regg I LLC Star Marianne 178,906 January 14, 2019 2010
29 Star Regg II LLC Star Janni 178,978 January 7, 2019 2010
30 Star Trident V LLC Star Angie 177,931 October 29, 2014 2007
31 Global Cape Shipping LLC Kymopolia 176,990 July 11, 2014 2006
32 Star Trident XXV LLC Star Triumph 176,343 December 8, 2017 2004
33 ABY Fourteen LLC Star Scarlett 175,649 August 3, 2018 2014
34 ABY Fifteen LLC Star Audrey 175,125 August 3, 2018 2011
35 ABY I LLC Star Paola 115,259 August 3, 2018 2011
36 ABM One LLC Star Eva 106,659 August 3, 2018 2012
37 Nautical Shipping LLC Amami 98,681 July 11, 2014 2011
38 Majestic Shipping LLC Madredeus 98,681 July 11, 2014 2011
39 Star Sirius LLC Star Sirius 98,681 March 7, 2014 2011
40 Star Vega LLC Star Vega 98,681 February 13, 2014 2011
41 ABY II LLC Star Aphrodite 92,006 August 3, 2018 2011
42 Augustea Bulk Carrier LLC Star Piera 91,951 August 3, 2018 2010

 

 35 
Table of Contents

 

        Date  
  Wholly Owned Subsidiaries Vessel Name DWT Delivered to Star Bulk Year Built
43 Augustea Bulk Carrier LLC Star Despoina 91,951 August 3, 2018 2010
44 Star Trident I LLC Star Kamila 82,769 September 3, 2014 2005
45 Star Nor IV LLC Star Electra 83,494 July 6, 2018 2011
46 Star Alta I LLC Star Angelina 82,981 December 5, 2014 2006
47 Star Alta II LLC Star Gwyneth 82,790 December 5, 2014 2006
48 Star Nor VI LLC Star Luna 82,687 July 6, 2018 2008
49 Star Nor V LLC Star Bianca 82,672 July 6, 2018 2008
50 Grain Shipping LLC Pendulum 82,619 July 11, 2014 2006
51 Star Trident XIX LLC Star Maria 82,598 November 5, 2014 2007
52 Star Trident XII LLC Star Markella 82,594 September 29, 2014 2007
53 ABY Seven LLC Star Jeanette 82,566 August 3, 2018 2014
54 Star Trident IX LLC Star Danai 82,574 October 21, 2014 2006
55 Star Sun I LLC Star Elizabeth 82,403 May 25, 2021 2021
56 Star Trident XI LLC Star Georgia 82,298 October 14, 2014 2006
57 Star Trident VIII LLC Star Sophia 82,269 October 31, 2014 2007
58 Star Trident XVI LLC Star Mariella 82,266 September 19, 2014 2006
59 Star Trident XIV LLC Star Moira 82,257 November 19, 2014 2006
60 Star Trident X LLC Star Renee 82,221 December 18, 2014 2006
61 Star Trident XIII LLC Star Laura 82,209 December 8, 2014 2006
62 Star Nor VIII LLC Star Mona 82,188 July 6, 2018 2012
63 Star Trident II LLC Star Nasia 82,220 August 29, 2014 2006
64 Star Nor VII LLC Star Astrid 82,158 July 6, 2018 2012
65 Star Trident XVII LLC Star Helena 82,187 December 29, 2014 2006
66 Star Trident XVIII LLC Star Nina 82,224 January 5, 2015 2006
67 Waterfront Two LLC Star Alessia 81,944 August 3, 2018 2017
68 Star Nor IX LLC Star Calypso 81,918 July 6, 2018 2014
69 Star Elpis LLC Star Suzanna 81,711 May 15, 2017 2013
70 Star Gaia LLC Star Charis 81,711 March 22, 2017 2013
71 Mineral Shipping LLC Mercurial Virgo 81,545 July 11, 2014 2013
72 Star Nor X LLC Stardust 81,502 July 6, 2018 2011
73 Star Nor XI LLC Star Sky 81,466 July 6, 2018 2010
74 Star Zeus VI LLC Star Lambada 81,272 March 16, 2021 2016
75 Star Zeus I LLC Star Capoeira 81,253 March 16, 2021 2015
76 Star Zeus II LLC Star Carioca 81,262 March 16, 2021 2015
77 Star Zeus VII LLC Star Macarena 81,198 March 6, 2021 2016
78 ABY III LLC Star Lydia 81,187 August 3, 2018 2013
79 ABY IV LLC Star Nicole 81,120 August 3, 2018 2013
80 ABY Three LLC Star Virginia 81,061 August 3, 2018 2015
81 Star Nor XII LLC Star Genesis 80,705 July 6, 2018 2010
82 Star Nor XIII LLC Star Flame 80,448 July 6, 2018 2011
83 Star Trident III LLC Star Iris 76,466 September 8, 2014 2004
84 Star Trident XX LLC Star Emily 76,417 September 16, 2014 2004

 

 

 36 
Table of Contents

 

        Date  
  Wholly Owned Subsidiaries Vessel Name DWT Delivered to Star Bulk Year Built
85 Orion Maritime LLC Idee Fixe 63,458 March 25, 2015 2015
86 Primavera Shipping LLC Roberta 63,426 March 31, 2015 2015
87 Success Maritime LLC Laura 63,399 April 7, 2015 2015
88 Ultra Shipping LLC Kaley 63,283 June 26, 2015 2015
89 Blooming Navigation LLC Kennadi 63,262 January 8, 2016 2016
90 Jasmine Shipping LLC Mackenzie 63,226 March 2, 2016 2016
91 Star Lida I Shipping LLC Star Apus 63,123 July 16, 2019 2014
92 Star Zeus V LLC Star Bovarius 61,602 March 16, 2021 2015
93 Star Zeus IV LLC Star Subaru 61,571 March 16, 2021 2015
94 Star Nor XV LLC Star Wave 61,491 July 6, 2018 2017
95 Star Challenger I LLC Star Challenger (1) 61,462 December 12, 2013 2012
96 Star Challenger II LLC Star Fighter (1) 61,455 December 30, 2013 2013
97 Aurelia Shipping LLC Honey Badger 61,320 February 27, 2015 2015
98 Star Axe II LLC Star Lutas 61,347 January 6, 2016 2016
99 Rainbow Maritime LLC Wolverine 61,292 February 27, 2015 2015
100 Star Axe I LLC Star Antares 61,258 October 9, 2015 2015
101 ABY Five LLC Star Monica 60,935 August 3, 2018 2015
102 Star Asia I LLC Star Aquarius 60,916 July 22, 2015 2015
103 Star Asia II LLC Star Pisces 60,916 August 7, 2015 2015
104 Star Lida XI Shipping LLC Star Pyxis 56,615 August 19, 2019 2013
105 Star Lida VIII Shipping LLC Star Hydrus 56,604 August 8, 2019 2013
106 Star Lida IX Shipping LLC Star Cleo 56,582 July 15, 2019 2013
107 Star Trident VII LLC Diva 56,582 July 24, 2017 2011
108 Star Lida X Shipping LLC Star Pegasus 56,540 July 15, 2019 2013
109 Star Lida V Shipping LLC Star Dorado 56,507 July 16, 2019 2013
110 Star Regg III LLC Star Bright 55,569 October 10, 2018 2010
111 Glory Supra Shipping LLC Strange Attractor 55,742 July 11, 2014 2006
112 Star Omicron LLC Star Omicron 53,489 April 17, 2008 2005
    Total dwt 12,506,342    

 

(1)Subject to a sale and leaseback financing transaction, as further described in Note 7 to our audited consolidated financial statements included in this annual report.

Vessels Under Construction:

  Vessel Name Drybulk Vessel Type DWT Shipyard Expected
Delivery
 Date
1 Hull No 15 Kamsarmax 82,000 Qingdao Shipyard Co. Ltd. Sep-25
2 Hull No 16 Kamsarmax 82,000 Qingdao Shipyard Co. Ltd. Sep-25
3 Hull No 17 Kamsarmax 82,000 Qingdao Shipyard Co. Ltd. Apr-26
4 Hull No 18 Kamsarmax 82,000 Qingdao Shipyard Co. Ltd. Jul-26
5 Hull No 23 Kamsarmax 82,000 Qingdao Shipyard Co. Ltd. Apr-26
      410,000    

 

 37 
Table of Contents

 

Long Term Time Charter In and Long Term Time Charter In Newbuilding Vessels:

In addition, we have entered into the following long-term charter-in arrangements:

# Name DWT Built Yard Delivery / Estimated Delivery Minimum Period
1 Star Shibumi 180,000 2021 JMU November 30, 2021 November 2028
2 Star Voyager 82,000 2024 Tsuneishi, Zhousan January 11, 2024 7 years
3 NB Kamsarmax # 2 82,000 2024 Tsuneishi, Zhousan Q4 - 2024 7 years
4 Star Explorer 82,000 2024 JMU March 8, 2024 7 years
5 NB Kamsarmax # 4 82,000 2024 JMU Q3 - 2024 7 years
6 Stargazer 66,000 2024 Tsuneishi, Cebu January 16, 2024 7 years
7 NB Ultramax #2 66,000 2024 Tsuneishi, Cebu Q4 - 2024 7 years
    640,000        

  

Our Competitive Strengths

We work hard to maintain and further enhance our competitive strengths in the industry, including:

We manage a large, high quality, scrubber fitted modern fleet.

We own a modern, diverse, high quality fleet of 112 dry bulk carrier vessels with an aggregate capacity of 12.5 million dwt and an average age of 11.8 years. In addition, 108 out of the 112 vessels in our fleet are retrofitted with exhaust gas cleaning systems. We believe that owning a large, modern, high quality fleet allows us to maintain competitive operating costs, achieve high safety standards, and secure favorable time charters. We maintain the quality of our vessels by carrying out regular inspections, both while in port and at sea, and adopting a comprehensive maintenance program for each vessel. Furthermore, we take a proactive approach to safety and environmental protection through comprehensively planned maintenance systems, preventive maintenance programs and by retaining and training qualified crews.

Based on the scale, scope and quality of our fleet and our commercial and technical management capabilities and because much of our fleet is currently chartered on the spot market, we believe we are well-positioned to manage the cyclicality of the dry bulk market.

The scale of our fleet also enables us to pilot and assess new technologies on board our vessels, including but not limited to energy efficiency and cybersecurity technologies, as well as to attract talented professionals both on board our vessels and in our offices.

Following the expected closing of the Eagle Merger, we expect that Star Bulk will be the largest U.S. listed dry bulk shipping company with a global market presence and an expected combined fleet of 163 owned vessels on a fully delivered basis, 98% of which will be fitted with scrubbers, ranging from Newcastlemax/Capesize to Supramax/Ultramax vessels. We believe that, based on the knowledge of our management, Eagle is the only large fleet of scrubber-fitted Supramax/Ultramax vessels in the world. We and Eagle both employ fully integrated ship management operations across commercial and technical management, and we expect to leverage Eagle’s commercial expertise in the Supramax/Ultramax sector to improve upon utilization and performance.

 

 38 
Table of Contents

 

In-house and integrated commercial and technical management of our fleet enables us to have competitive operating expenses and high vessel maintenance, environmental and operating standards.

We conduct a significant portion of the commercial and technical management of our vessels in-house through our wholly owned subsidiaries, Star Bulk Management Inc., Star Bulk Shipmanagement Company (Cyprus) Limited and Starbulk S.A. We believe having control over the commercial and technical management provides us with a competitive advantage over many of our competitors by allowing us to monitor our operations more closely and to offer higher quality performance, reliability and efficiency in arranging charters and the maintenance of our vessels. We also believe that these management capabilities contribute significantly in maintaining a lower level of vessel operating and maintenance costs, while ensuring high standards in the safety, security, quality and environmental performance of our operations.

We deploy advanced business systems, data and analytics, including new measures and technologies to improve fuel and energy efficiency.

We deploy advanced systems to support our business operations and everyday decision-making, including Enterprise Resource Planning, Business Intelligence, and e-procurement platforms. In response to the increased environmental regulations around decarbonization, we have also focused our attention on improving the sustainability and fuel efficiency of our operations. A substantial part of our fleet have been equipped with a sophisticated vessel performance monitoring system (“VPM”), allowing us to collect real-time information on the performance of important equipment, with a particular focus on vessel performance, fuel consumption and exhaust gas emissions. The system is designed to enhance our operational knowledge and increase the efficiency of our trading and of our vessel maintenance. We continue to invest in further digitalization of our fleet and aim to have VPM sensors and equipment further installed onboard all of our vessels. The process is ongoing with approximately 50% of our fleet already fitted with relevant equipment as of December 31, 2023. We expect our entire fleet will be fully digitalized by the end of 2024.

Furthermore we take operational measures, including speed reduction, weather routing, voyage optimization and have planned further technical upgrades to our fleet, such as the use of ESD and low friction hull paints in order to reduce fuel consumption and emissions. Overall, 31 vessels have been fitted with ESD in 2023, and we have planned for another 16 vessels to be equipped with such devices in 2024. We plan to use underwater ROV (Remotely Operated Vehicles) for inspecting and cleaning the underwater hulls of our vessels. We also plan to proceed with EPL (Engine Power Limitation) in order to meet the IMO EEXI (Energy Efficiency Existing Ship Index) requirements.

Most of our vessels’ main engines have been retrofitted with sliding engine valves and alpha lubricators, which provide additional fuel efficiency and optimized lubricant consumption. We are replacing the conventional lights of our ships with LED lights in order to reduce energy consumption.

We believe that the above measures are the most efficient initiatives towards decarbonization until technological advances allow the use of very low or zero carbon emission fuels. We have performed a thorough evaluation of our fleet’s performance, which has juxtaposed the projected performance of each of our vessels against the applicable regulatory requirements.

Finally we have established a compliance section within our Technical department in order to monitor exhaust gas emissions and ensure compliance with regional and international regulations.

We have an experienced management team with a strong track record in the shipping industry and extensive relationships with customers, lenders, shipyards and other shipping industry participants.

Our Company’s leadership has considerable shipping industry expertise. Our founder and Chief Executive Officer, Mr. Pappas, has an established track record in the dry bulk industry, with long-standing shipping experience and hundreds of vessel acquisitions and dispositions, including through his family’s principal shipping operations and investment vehicle, Oceanbulk Maritime S.A. Mr. Pappas also has long-standing relationships in the shipping industry, which he has leveraged with shipbuilders, among others, to implement our newbuilding program with vessels of high specification.

 

 39 
Table of Contents

 

Through Mr. Pappas, our management team, and our senior professionals, we also have strong global relationships with shipping companies, charterers, brokers, commercial shipping lenders, regulators, shipyards, port authorities, classification societies and other international organizations. Further, our team’s long track record in the voyage and time chartering of dry bulk ships allows us to continue successfully chartering our vessels in all economic environments. Our reputation as a trusted counterparty allows us to have access to attractive asset acquisitions, chartering and ship financing opportunities.

For more information on our management team, see “Item 6. Directors, Senior Management and Employees –– A. Directors and Senior Management.”

Our Business Strategies

Our vision is to be a global leader in sustainable dry bulk shipping. In that respect, we strive to continue operating our fleet safely and profitably as well as to continue growing our owned and managed fleet sustainably. The key elements of our strategy are:

Charter our vessels in a manner that maximizes our fleet’s revenue potential

Given the volatility of the freight markets, we are flexible to changing market conditions and actively manage our vessels in order to generate attractive risk-adjusted returns by providing efficient transportation solutions to our major charterers. Our aim is to continue improving our fleet utilization by booking long haul voyage charters and complimentary trade flows that improve the laden/ballast ratios. This approach is also tailored specifically to our scrubber-fitted fleet and the fuel efficiency of our younger vessels. While this process is more difficult and labor intensive than placing our vessels on longer-term time charters, it can lead to greater profitability. When operating a vessel on a voyage charter, as well as on contracts of affreightment directly with cargo providers, we (as owner of the vessel) will incur fuel costs, and therefore, we are in a position to benefit from fuel savings from our scrubber-fitted fleet. If charter market levels rise, we may employ part of our fleet in the long-term time charter market, while we may be able to employ our scrubber-fitted vessels more advantageously in the voyage charter market and/or short-term time charters in order to capture the benefit of available fuel cost savings. Our large, diverse and high-quality fleet provides scale to major charterers, such as iron ore miners, utility companies and commodity trading houses. As part of our strategy to maximize earnings, we seek direct arrangements (consecutive voyages, contracts of affreightment, etc.) with major charterers and cargo owners on a voyage basis, providing the scale required for the transportation of large commodity volumes over a multitude of trading routes around the world.

We are also party of a Capesize vessel pooling agreement (“Capesize Chartering Ltd or CCL Pool or CCL”) with Bocimar International NV, and C Transport Holding Ltd, managed by C Transport Maritime S.A.M (CTM). As of December 31, 2023, we operated 34 of our Newcastlemax and Capesize dry bulk vessels as part of one combined CCL fleet. The CCL fleet consists of 115 modern Newcastlemax and Capesize vessels and is being managed out of Athens, Singapore and Antwerp. Each vessel owner is responsible for the operating, accounting and technical management of its respective vessels. The objective of this pool is to provide improved scheduling through joint marketing of our Newcastlemax and Capesize vessels, with the overall aim of enhancing economic efficiencies.

In 2020, we established a wholly-owned subsidiary based in Singapore under the name Star Bulk (Singapore) Pte. Ltd. (or “Star Bulk Singapore”). Star Bulk Singapore charters-in a number of third-party vessels to increase our operating capacity in order to satisfy our clients’ needs and to expand our commercial capability and access to charterers and cargoes in Asia.

 

 40 
Table of Contents

 

Expand and renew our fleet through opportunistic acquisitions of high-quality vessels at attractive prices or through chartering-in of modern vessels

We may look to opportunistically acquire high-quality vessels at attractive prices that are accretive to our cash flow. We also look to opportunistically renew our fleet by replacing older vessels that have higher maintenance and survey costs and lower operating efficiencies with newer vessels that have lower operating costs, fewer maintenance and survey requirements, lower fuel consumption and overall enhanced commercial attractiveness to our charterers. When evaluating acquisitions, we will consider and analyze, among other things, our expectations of fundamental developments in the dry bulk shipping industry sector, the level of liquidity in the resale and charter market, the cash flow earned by the vessel in relation to its value, its condition and technical specifications with particular regard to fuel consumption, expected remaining useful life, the credit quality of the charterer and duration and terms of charter contracts for vessels acquired with charters attached, as well as the overall diversification of our fleet and customers. During 2023, we entered into long-term charter-in arrangements with an approximate duration of seven years per vessel, plus optional years depending on our decision, with respect to six newbuilding vessels of which three have already been delivered and the remaining three are expected to be delivered until the end of 2024.

On December 11, 2023, we entered into the Eagle Merger Agreement, pursuant to which Eagle will become a wholly owned subsidiary of Star Bulk. Following the expected closing of the Eagle Merger, we expect that Star Bulk will be the largest U.S. listed dry bulk shipping company with a global market presence and an expected combined fleet of 163 owned vessels on a fully delivered basis, 98% of which will be fitted with scrubbers, ranging from Newcastlemax/Capesize to Supramax/Ultramax vessels. We believe that, based on the knowledge of our management, Eagle is the only large fleet of scrubber-fitted Supramax/Ultramax vessels in the world. We and Eagle both employ fully integrated ship management operations across commercial and technical management, and we expect to leverage Eagle’s commercial expertise in the Supramax/Ultramax sector to improve upon utilization and performance. In evaluating the Eagle Merger, among other factors, we also considered the complementary cultures of Star Bulk and Eagle, including their focus on safety and environmental, social and governance matters. Further, Star Bulk expects the Eagle Merger to generate significant annual cost and revenue synergies through commercial operations integration and economies of scale, including restrictions in general and administrative expenses per vessel per day. Star Bulk also expects, after the expected Eagle Merger, to have significantly increased combined market capitalization and trading liquidity, reducing cost of capital.

We believe that these circumstances combined with our management’s knowledge of the shipping industry may present an opportunity for us to continue to grow our fleet at favorable prices.

Maintain a strong balance sheet through optimization of use of leverage

We finance our fleet with a mix of debt and equity, and we intend to optimize use of leverage over time, even though we may have the capacity to obtain additional financing. As of December 31, 2023, our debt to total capitalization ratio was approximately 40%. Charterers have increasingly favored financially solid vessel owners, and we believe that our balance sheet strength will enable us to access more favorable chartering opportunities, as well as give us a competitive advantage in pursuing vessel acquisitions from commercial banks and shipyards, which in our experience have recently displayed a preference for contracting with well-capitalized counterparties.

Maintain competitive costs and safeguard high quality standards

We continuously monitor our operating, voyage, and general and administrative costs and strive to be as lean and efficient as possible, without sacrificing the safety, security, quality and environmental standards of our fleet and our operations. Our experienced and skilled technical management team, as well as our competent crews on board, work hard to maintain and exceed the quality standards of our customers and other constituents, as well as to ensure the health, safety and security of our people on the vessels, and to minimize the impact of our operations on the environment.

Be a leader in ESG practices in the dry bulk shipping sector

We are committed to integrating ESG practices across all business operations, and to reporting on our ESG strategy and performance in a transparent and comprehensive way. We strive to comply with environmental regulations in a timely and efficient manner, and we monitor and aim to reduce our environmental footprint. We assess, pilot and implement new technologies to improve our environmental performance. On the social front, we focus on our people’s well-being and professional development, both on board our vessels and in the office, while fostering an equitable, inclusive and diverse working environment. We support our local community through donations, sponsorships and pro-bono work, towards vulnerable groups, education, sports and the environment. Our approach to corporate governance includes high ethical standards and transparent and efficient structures as well as robust risk management systems.

 

 41 
Table of Contents

 

Competition

Demand for dry bulk carriers fluctuates in line with the main patterns of trade of the major dry bulk cargoes and varies according to their supply and demand. We compete with other owners of dry bulk carriers in the Newcastlemax, Capesize, Post Panamax, Kamsarmax, Panamax, Ultramax and Supramax size sectors. Ownership of dry bulk carriers is highly fragmented. We compete for charters on the basis of price, vessel location, size, age and condition of the vessel, as well as on our reputation as an owner and operator.

Customers

We have well-established relationships with major dry bulk charterers, which we serve by carrying a variety of cargoes over a multitude of routes around the globe. We charter out our vessels to first class iron ore miners, utilities companies, commodity trading houses and diversified shipping companies.

Seasonality

Demand for vessel capacity has historically exhibited seasonal variations and, as a result, fluctuations in charter rates. This seasonality may result in quarter-to-quarter volatility in our operating results for vessels trading in the spot market. The dry bulk sector is typically stronger in the fall and winter months in anticipation of increased consumption of coal and other raw materials in the northern hemisphere. Seasonality in the sector in which we operate could materially affect our operating results and cash flows.

Operations

In-House Management of the fleet

Star Bulk Management Inc., Star Bulk Shipmanagement Company (Cyprus) Limited and Starbulk S.A., three of our wholly-owned subsidiaries, perform the operational and technical management services for the majority of the vessels in our fleet, including chartering, marketing, capital expenditures, personnel, accounting, paying vessel taxes and maintaining insurance.

As of December 31, 2023, we had 216 employees engaged in the day to day management of our fleet, including our executive officers, through Star Bulk Management Inc., Star Bulk Shipmanagement Company (Cyprus) Limited and Starbulk S.A. which employ a number of shore-based executives and employees, designed to ensure the efficient performance of our activities. We reimburse and/or advance funds as necessary to our in-house managers in order for them to conduct their activities and discharge their obligations, at cost.

Star Bulk Management Inc. is responsible for the management of the vessels. Star Bulk Management’s responsibilities include, inter alia, locating, purchasing, financing and selling vessels, deciding on capital expenditures for the vessels, paying vessels’ taxes, negotiating charters for the vessels, managing the mix of various types of charters, developing and managing the relationships with charterers and the operational and technical managers of the vessels. Star Bulk Management Inc. subcontracts certain vessel management services to Starbulk S.A.

Starbulk S.A. provides the technical and crew management of the majority of our vessels. Technical management includes maintenance, dry docking, repairs, insurance, regulatory and classification society compliance, arranging for and managing crews, appointing technical consultants and providing technical support.

As of December 31, 2023, Star Bulk Shipmanagement Company (Cyprus) Limited provides technical and operation management services to 10 of our vessels. The management services include arrangement and supervision of dry docking, repairs, insurance, regulatory and classification society compliance, provision of crew, appointment of surveyors and technical consultants.

 

 42 
Table of Contents

 

Crewing

Starbulk S.A. and Star Bulk Shipmanagement Company (Cyprus) Limited are responsible for recruiting, either directly or through a technical manager or a crew manager, the senior officers and all other crew members for the vessels in our fleet. Both companies have the responsibility to ensure that all seamen have the qualifications and licenses required to comply with international regulations and shipping conventions, and that the vessels are manned by experienced, competent and trained personnel. Starbulk S.A. and Star Bulk Shipmanagement Company (Cyprus) Limited are also responsible for ensuring that seafarers’ wages and terms of employment conform to international standards or to general collective bargaining agreements to allow unrestricted worldwide trading of the vessels and provide the crewing management for the vessels in our fleet that are not managed by third-party managers.

Outsourced Management of the fleet

We engage Ship Procurement Services S.A., a third-party company, to provide to our fleet certain procurement services.

Following the completion of the acquisition of certain vessels from Augustea Atlantica SpA (“Augustea”) and York Capital Management (“York”) in 2018, (the “Augustea Vessels”), we appointed Augustea Technoservices Ltd., an entity affiliated with certain of the sellers of the corresponding transaction and specifically with one of the Company’s directors, Mr. Zagari (see “Item 6. Directors, Senior Management and Employees –– A. Directors and Senior Management”) as the technical manager of certain of our vessels. During 2021 and 2022, certain management services of the vessels previously managed by Augustea Technoservices Ltd were appointed to Iblea Ship Management Limited, an entity also affiliated with Mr. Zagari. Up until June 2022, the management agreements with Augustea Technoservices Ltd were progressively terminated.

During 2018 and 2019, we also appointed Equinox Maritime Ltd., Zeaborn GmbH & Co. KG and Technomar Shipping Inc., which are third-party management companies, to provide certain management services to our vessels.

During 2022 and 2023, the management of certain vessels previously managed by Iblea Ship Management Limited and Technomar Shipping Inc transitioned from third-party to in-house management. In 2022 all management agreements with Technomar Shipping Inc. were terminated. As of December 31, 2023, Equinox Maritime Ltd., Zeaborn GmbH & Co. KG and Iblea Ship Management Limited provide technical, operation and crewing management services to 19 of the 116 vessels in our fleet. Please also see “Item 7. Major Shareholders and Related Party Transactions –– B. Related Party Transactions.” 

Basis for Statements

The International Dry Bulk Shipping Industry

Dry bulk cargo is cargo that is shipped in large quantities and can be easily stowed in a single hold with little risk of cargo damage. In 2023, based on preliminary figures, it is estimated that approximately 5.51 billion tons of dry bulk cargo was transported by sea.

 

 43 
Table of Contents

 

The demand for dry bulk carrier capacity is derived from the underlying demand for commodities transported in dry bulk carriers, which is influenced by various factors such as broader macroeconomic dynamics, globalization trends, industry specific factors, geological structure of ores, political factors, and weather. The demand for dry bulk carriers is determined by the volume and geographical distribution of seaborne dry bulk trade, which in turn is influenced by general trends in the global economy and factors affecting demand for commodities. During the 1980s and 1990s seaborne dry bulk trade increased by 1-2% per annum. However, over the last fifteen years, between 2008 and 2023, seaborne dry bulk trade increased at a compound annual growth rate of 3.0%, substantially influenced by the entrance of China in the World Trade Organization. Seaborne world trade increased by 3.9% during 2023 due to re-opening of the Chinese economy after the scrap of the COVID-19 zero tolerance policy, the easing of inflationary pressure and the prioritization from nations to procure raw materials and especially energy commodities. The global dry bulk carrier fleet may be divided into seven categories based on a vessel’s carrying capacity. These main categories consist of:

·Newcastlemax vessels, which are vessels with carrying capacities of between 200,000 and 210,000 dwt. These vessels carry both iron ore and coal and they represent the largest vessels able to enter the port of Newcastle in Australia. There are relatively few ports around the world with the infrastructure to accommodate vessels of this size.
·Capesize vessels, which are vessels with carrying capacities of between 100,000 and 200,000 dwt. These vessels generally operate along long-haul iron ore and coal trade routes. There are relatively few ports around the world with the infrastructure to accommodate vessels of this size.
·Post-Panamax vessels, which are vessels with carrying capacities of between 90,000 and 100,000 dwt. These vessels tend to have a shallower draft and larger beam than a standard Panamax vessel, and a higher cargo capacity. These vessels have been designed specifically for loading high cubic cargoes from draft restricted ports, and they can traverse the Panama Canal following the completion of its latest expansion.
·Panamax vessels, which are vessels with carrying capacities of between 65,000 and 90,000 dwt. These vessels carry coal, grains, and, to a lesser extent, minor bulks, including steel products, forest products and fertilizers. Panamax vessels can pass through the Panama Canal.
·Ultramax vessels, which are vessels with carrying capacities of between 60,000 and 65,000 dwt. These vessels carry grains and minor bulks and operate along many global trade routes. They represent the largest and most modern version of Supramax bulk carrier vessels (see below).
·Handymax vessels, which are vessels with carrying capacities of between 35,000 and 60,000 dwt. The subcategory of vessels that have a carrying capacity of between 45,000 and 60,000 dwt are called Supramax. Handymax vessels operate along a large number of geographically dispersed global trade routes, mainly carrying grains and minor bulks. Vessels below 60,000 dwt are sometimes built with on-board cranes enabling them to load and discharge cargo in countries and ports with limited infrastructure.
·Handysize vessels, which are vessels with carrying capacities of up to 35,000 dwt. These vessels carry exclusively minor bulk cargo. Increasingly, these vessels have been operating along regional trading routes. Handysize vessels are well suited for small ports with length and draft restrictions that lack the infrastructure for cargo loading and unloading.

 

 44 
Table of Contents

 

The supply of dry bulk carriers is dependent on the delivery of new vessels and the removal of vessels from the global fleet, either through scrapping or loss, and the demand for dry bulk shipping is often dependent on economic conditions, and international trade. The historically low dry bulk charter rates seen in 2016 acted as a catalyst for ship owners, who scrapped a significant number of vessels, until equilibrium between demand and supply of vessels was achieved. Based on our analysis of industry dynamics, we believe that dry bulk charter rates will remain strong in the medium term due to historically low vessel deliveries. As of January 1, 2024, the global dry bulk carrier order book amounted to approximately 8.7% of the existing fleet at that time, marginally above the record low of the last 30 years. During 2023, a total of 5.41 million dwt was scrapped, which was well below the 15 years average of 15.37 million dwt, as the freight market performed in line with the historical average. Historically, from 2008 to 2023, vessel annual demolition rate averaged 14.76 million dwt per year, with a high of 33.3 million dwt scrapped in 2012. Given the low dry bulk order book, the uncertainty on future propulsion as a result of upcoming environmental regulations and the limited shipyard capacity, vessel supply is likely to be constrained during the next years, while demand for seaborne trade is expected to surpass vessel supply resulting in increased fleet utilization and elevated freight rates. While the charter market remains at current levels, we intend to operate our vessels in the spot market under short-term time charters or voyage charters in order to benefit from the increased freight rates and the attractiveness of our scrubber-equipped vessels.

Charter rates paid for dry bulk carriers 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 similar across the different charter types and between the different dry bulk carrier categories. However, because demand for larger dry bulk carriers is affected by the volume and pattern of trade in a relatively small number of commodities, charter 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 also influenced by cargo size, commodity, port dues and canal transit fees, as well as delivery and redelivery 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 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.

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

Dry bulk shipping is a cyclical industry and charter hires are subject to high volatility. The BDI reached a historic high of 11,793 in May 2008 and a low of 290 in February 2016, which represents a decline of 98%. In 2023, the BDI ranged from a low of 530 on February 16, 2023, to a high of 3,346 on December 4, 2023. Even though 2023 charter hire levels ranged well above the lows of 2016, there can be no assurance that the market will not decline again. As of February 9, 2024, the BDI stood at 1,545.

Environmental and Other Regulations in the Shipping Industry

Government laws and regulations significantly affect the ownership and operation of our fleets. We are subject to international conventions and treaties, national, state and local laws and regulations in force in the countries where our vessels may operate or are registered, relating to safety, health and environmental protection. Industry standards and regulations set by maritime organizations play a major role in the manner in which we conduct our business. We believe taking all the necessary measures and going above and beyond compliance is the prerequisite for delivering services of the highest quality. The above include the proper 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.

 

 45 
Table of Contents

 

Our Company has specifically developed a recycling policy, which has been included within our Safety Management System (“SMS”) and applies to all the managed vessels. In addition to the above, there are clearly and accurately defined measures that need to be adhered to as well as standards that should be achieved, which are required, in view of the levels of excellence that our Company aims for and achieves. There is a clear delegation of the monitoring and maintenance to responsible entities (both ashore and on board) and duties have been clarified as required. Each vessel has a ship specific plan (namely the Inventory of Hazardous Materials), which has been reviewed and approved by the competent classification society and has been certified for compliance with the required regulation.

Further to the above, the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, 2009 (the “Hong Kong Convention”), which applies to ships above 500 gross tonnage (“GT”), will enter into force on June 26, 2025. Under the Hong Kong Convention, ships must develop and maintain onboard an inventory of hazardous materials. Furthermore, ships must prepare a ship recycling plan prior to being recycled and shall only be recycled at ship recycling facilities authorized by competent authority.

Active engagement with state and regulatory authorities helps achieve compliance with all applicable standards and regulation. We follow and comply with state and regulatory authority rules and regulations and have adopted and implemented all the necessary operational procedures in order to meet the requirements of those regulations, such as air emission compliance (NOx, SOx and CO2 reporting). We aim to provide top-quality services without neglecting to adjust for industry needs, always maintaining high ethical standards and aiming to abide by all applicable laws, rules, regulations and standards. We focus on creating real and long-lasting opportunities while advocating for a balanced, sustainable approach to our business and pursuing continuous improvement of our operational capabilities.

Furthermore, we established a standardized and structured process to ensure completeness, consistency and accuracy in our emissions-related monitoring and reporting process for worldwide, EU and UK operations, including with respect to the Monitoring, Reporting and Verification (“MRV”) regulation and the IMO Data Collection System (“DCS”), as well as the relevant monitoring plans and advanced data collection, analysis, monitoring and reporting systems through our VPM system. As part of the data collection and key performance indicators’ calculation process, we use our in-house developed VPM system, which provides accurate and real time information regarding the performance of our vessels. Additionally, with the introduction of IMO DCS, EU MRV, and UK MRV, the reported CO2 emissions of our vessels are also subjected to third-party verification by an independent accredited verifier.

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 USCG, harbor master or equivalent), classification societies, flag state administrations (countries of registry) and charterers, particularly terminal operators. 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.

Apart from the above, our Company has also become certified according to the ISO 9001, 14001, 45001 and 50001 standards pertaining to compliance with elevated quality, environmental, occupational health and safety and energy efficiency requirements, thus increasing the requirements our vessels and management company have to comply with on various levels.

Further to the above, the Company has become certified for ISO 26000, 27001 and 31000 standards and guidelines pertaining to social responsibility, cybersecurity and risk management. These standards serve to ensure our compliance with best practices in these areas.

In addition, RightShip, which is a voluntary compliance requirement but a highly desirable chartering verifier among top charterers, is also demanding compliance with their standards regarding environmental acceptability based on a number of variables and factors important in the maritime industry.

Additionally, now that the EEXI has come into force, RightShip is in the process of incorporating EEXI requirements in their platform for assessment and recommendation purposes. Increasing environmental concerns have created a demand for vessels that conform to stricter environmental standards. We are required to maintain operating standards for all of our vessels that emphasize operational safety, quality maintenance, continuous training of our officers and crews and compliance with United States and international regulations. We ensure that the operation of our vessels is in full compliance with applicable environmental laws and regulations and that our vessels have all material permits, licenses, certificates or other authorizations necessary for carrying out 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.

 

 46 
Table of Contents

 

International Maritime Organization

The IMO 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 (“MARPOL”), the International Convention for the Safety of Life at Sea of 1974 (“SOLAS Convention”), and the International Convention on Load Lines of 1966 (the “LL Convention”). MARPOL establishes environmental standards relating to oil leakage or spilling, garbage management, sewage, air emissions, 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. New emissions standards, titled IMO-2020, took effect on January 1, 2020, and new amendments to Annex VI, relating to carbon intensity and energy efficiency, took effect on January 1, 2023.

Air Emissions

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) and emissions from 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. We strive to ensure that all of our vessels are in full compliance in all material respects with these regulations.

The Marine Environment Protection Committee (“MEPC”) subsequently adopted amendments to Annex VI regarding emissions of sulfur oxide, nitrogen oxide, particulate matter and ozone depleting substances. The amended Annex VI implemented a progressive reduction of the amount of sulfur contained in any fuel oil used on board ships, among other changes. At its 70th session, the MEPC adopted a global 0.5% m/m sulfur oxide emissions limit (reduced from 3.5%) starting from January 1, 2020. This limitation can be met by using low-sulfur compliant fuel oil, alternative fuels or certain exhaust gas cleaning systems. Ships are required to obtain bunker delivery notes and International Air Pollution Prevention (“IAPP”) Certificates from their flag states that specify sulfur content. Additionally, further amendments to Annex VI to prohibit the carriage of bunkers above 0.5% sulfur on ships took effect March 1, 2020, with the exception of vessels fitted with exhaust gas cleaning equipment (“scrubbers”) which can carry fuel of higher sulfur content. These regulations subject ocean-going vessels to stringent emissions controls and may cause us to incur substantial costs.

Sulfur content standards are even stricter within certain “Emission Control Areas,” or (“ECAs”). Ships operating within an ECA are not permitted to use fuel with sulfur content in excess of 0.1% m/m. 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, and has approved the Mediterranean Sea as a fifth ECA, which enters into force on May 1, 2024 and requires compliance from May 1, 2025. Ocean-going vessels in these areas will be subject to stringent emission controls and may cause us to incur additional costs. Other areas in China are subject to local regulations that impose stricter emission controls. 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 (“EPA”) or the states where we operate, compliance with these regulations could entail significant capital expenditures or otherwise increase the costs of our operations.

Amended Annex VI also establishes new tiers of stringent nitrogen oxide emissions standards for marine diesel engines, depending on their date of installation. Tier III NOx standards apply to ships that operate in the North American and U.S. Caribbean Sea ECAs designed for the control of NOx produced by vessels with a marine diesel engine installed and constructed on or after January 1, 2016. Tier III requirements could apply to areas that will be designated for Tier III NOx in the future. At MEPC 70 and MEPC 71, the MEPC approved the North Sea and Baltic Sea as ECAs for nitrogen oxide for ships built on or after January 1, 2021. For the moment, this regulation relates to new building vessels and has no retroactive application to existing fleet. The EPA promulgated equivalent (and in some senses stricter) emissions standards in 2010. As a result of these designations or similar future designations, we may be required to incur additional operating or other costs.

 

 47 
Table of Contents

 

Further to the above, as of the September 1, 2020 it became mandatory to use fuel with max 0.1% sulfur content while berthing in South Korean ports. There are specific requirements for the berthing process, and we are diligently striving to comply with all of them. Moreover, from January 1, 2022 onwards, it is mandatory to use fuel with max 0.1% sulfur content while navigating South Korea’s ECAs.

The Korean regulations also relate to speed reductions. Certain port areas selected will be designated as “Vessel Speed Reduction program Sea Areas” or “VSR program Sea Areas”. Each VSR program Sea Area will span 20 nautical miles in radius, measured from a specific lighthouse in each port. Ships should navigate no faster than a maximum speed of 12 knots for container ships and car-carriers and 10 knots for other ship types, when moving from starting point to an end point within a VSR program Sea Area.

Since 2019, Regulation 22A of Annex VI has required ships above 5,000 gross tonnage to collect and report annual data on fuel oil consumption to an IMO database. The IMO intended to use such data as the first step in its roadmap (through 2023) for developing its strategy to reduce greenhouse gas emissions from ships, as discussed further below. In order to prove compliance with the above, our Company collects data, monitors the information received and is ready to report them though our VPM system.

MARPOL has also mandated certain measures relating to energy efficiency for ships. All ships are required to develop and implement Ship Energy Efficiency Management Plans (“SEEMP”), and new ships must be designed in compliance with minimum energy efficiency levels per capacity mile as defined by the Energy Efficiency Design Index (“EEDI”). Under these measures, by 2025, all new ships built will be 30% more energy efficient than those built in 2014. Further amendments to MARPOL Annex VI brought forward the effective date of the EEDI’s “phase 3” requirements from January 1, 2025 to April 1, 2022 for several ship types, including gas carriers, general cargo ships, and LNG carriers.

Additionally, MEPC 75 introduced amendments to Annex VI which impose new regulations to reduce greenhouse gas emissions from ships. These amendments introduced requirements to assess and measure the energy efficiency of all ships and set the required attainment values, with the goal of reducing the carbon intensity of international shipping. The requirements include (1) a technical requirement to reduce carbon intensity based on a new Energy Efficiency Existing Ship Index (“EEXI”), and (2) operational carbon intensity reduction requirements, based on a new operational carbon intensity indicator (“CII”). The attained EEXI is required to be calculated for ships of 400 gross tonnage and above, in accordance with different values set for ship types and categories. With respect to the CII, the amendments require ships of 5,000 gross tonnage to document and verify their actual annual operational CII achieved against a determined required annual operational CII. Additionally, MEPC 75 proposed amendments requiring that, on or before January 1, 2023, all ships above 400 gross tonnage must have an approved SEEMP on board. For ships above 5,000 gross tonnage, the SEEMP will need to include certain mandatory content. MEPC 75 also approved amendments to MARPOL Annex I to prohibit the use and carriage for use as fuel of heavy fuel oil (“HFO”) by ships in Arctic waters on and after July 1, 2024. The amendments introduced at MEPC 75 were adopted at the MEPC 76 session in June 2021 and entered into force on November 1, 2022, and the requirements for EEXI and CII certification came into effect on January 1, 2023. MEPC 77 adopted a non-binding resolution which urges Member States and ship operators to voluntarily use distillate or other cleaner alternative fuels or methods of propulsion that are safe for ships and could contribute to the reduction of Black Carbon emissions from ships when operating in or near the Arctic.

 

 48 
Table of Contents

 

Any vessels that will not meet this new EEXI requirement will need to limit their propulsion power and/or adopt energy-saving/emission reducing technology, through retrofits, to reach compliant levels. This creates a vast array of implications for the shipping industry going forward. Recycling of older ships could accelerate as the investments to comply with regulations may be very costly. One of the most efficient ways of reducing emissions is reducing vessel power and therefore speed, this would in turn limit the supply. The Company owns one of the most modern and fuel-efficient fleets in the industry.

Maintaining and improving our position in respect of the above creates an extremely compelling outlook for our Company in the next 2-5 years.

Our Company has also become certified under the ISO 50001 standard for energy efficiency, which has caused our vessels to comply with even more requirements and to ensure that they are continuously improving their performance in order to satisfy these requirements. Compliance with ISO 50001 requires that we continuously improve our vessels’ energy performance, energy efficiency, energy use and consumption.

The majority of our fleet is fitted with Exhaust Gas Cleaning Systems, which reduce the sulfur content of the exhaust gas emissions.

We may incur costs to comply with the revised standards mentioned above. Additional or new conventions, laws and regulations 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.

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, which entered into force in 2005 and pursuant to which adopting countries have been required to implement national programs to reduce greenhouse gas emissions with targets extended through 2020. International negotiations are continuing with respect to a successor to the Kyoto Protocol, and restrictions on shipping emissions may be included in any new treaty. 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. The U.S. initially entered into the agreement, but on June 1, 2017, former U.S. President Trump announced that the United States intends to withdraw from the Paris Agreement and the withdrawal became effective on November 4, 2020. On January 20, 2021, U.S. President Biden signed an executive order to rejoin the Paris Agreement, which the U.S. officially rejoined on February 19, 2021.

At MEPC 70 and MEPC 71, a draft outline of the structure of the initial strategy for developing a comprehensive IMO strategy on reduction of greenhouse gas emissions from ships was approved. In accordance with this roadmap, in April 2018, nations at the MEPC 72 adopted an initial strategy to reduce greenhouse gas emissions from ships. The initial strategy identifies “levels of ambition” to reducing greenhouse gas emissions, including (1) decreasing the carbon intensity from ships through implementation of further phases of the EEDI for new ships; (2) reducing carbon dioxide emissions per transport work, as an average across international shipping, by at least 40% by 2030, pursuing efforts towards 70% by 2050, compared to 2008 emission levels; and (3) reducing the total annual greenhouse emissions by at least 50% by 2050 compared to 2008 while pursuing efforts towards phasing them out entirely. The initial strategy notes that technological innovation, alternative fuels and/or energy sources for international shipping will be integral to achieve the overall ambition. These regulations could cause additional substantial expenses to be incurred. At MEPC 77, the nations agreed to revise the initial strategy, aiming to strengthen the “levels of ambition.” The revised strategy was considered by MEPC 80 in spring 2023, and it adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships, which builds upon the initial strategy’s levels of ambition. The revised levels of ambition include (1) further decreasing the carbon intensity from ships through improvement of energy efficiency; (2) reducing carbon intensity of international shipping; (3) increasing adoption of zero or near-zero emissions technologies, fuels, and energy sources; and (4) achieving net zero GHG emissions from international shipping. Furthermore, the following indicative checkpoints were adopted in order to reach net zero GHG emissions from international shipping: (1) reduce the total annual GHG emissions from international shipping by at least 20%, striving for 30%, by 2030, compared to 2008 levels; and (2) reduce the total annual GHG emissions from international shipping by at least 70%, striving for 80%, by 2040, compared to 2008 levels.

 

 49 
Table of Contents

 

As of January 2018, large ships over 5,000 gross tonnage calling at EU ports are required to collect and publish data on carbon dioxide emissions and other information. As further discussed herein, regulations relating to the inclusion of greenhouse gas emissions from the maritime sector in the European Union’s carbon market have entered into force, and additional regulations are forthcoming.

In the United States, the EPA issued a finding that greenhouse gases endanger the public health and safety, adopted regulations to limit greenhouse gas emissions from certain mobile sources and proposed regulations to limit greenhouse gas emissions from large stationary sources. However, in March 2017, former U.S. President Trump signed an executive order to review and possibly eliminate the EPA’s plan to cut greenhouse gas emissions, and, further, in August 2019, the Administration announced plans to weaken regulations for methane emissions. On August 13, 2020, the EPA released rules rolling back standards to control methane and volatile organic compound emissions from new oil and gas facilities. However, in early 2021, U.S. President Biden directed the EPA to publish a proposed rule suspending, revising, or rescinding certain of these rules. The resulting proposed rule was published in November 2021 and revised in December 2022, although a final rule has not yet been issued. The EPA or individual U.S. states could enact these or other environmental regulations that would affect our operations.

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 financial 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.

We may incur costs to comply with these revised standards. Additional or new conventions, laws and regulations 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 (the “LLMC”) sets limitations of liability for a loss of life or personal injury claim or a property claim against ship owners. We ensure that our vessels are in full compliance with SOLAS. Owners’ compliance with LLMC requirements is covered under the Protection & Indemnity insurance.

Under Chapter IX of the SOLAS Convention, or the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention (the “ISM Code”), our operations are also subject to environmental standards and requirements. The ISM Code requires the party with operational control of a vessel to develop an extensive safety management system that includes, among other things, the adoption of a safety and environmental protection policy setting forth instructions and procedures for operating its vessels safely and describing procedures for responding to emergencies. We rely upon the safety management system that we and our technical management team have developed for compliance with the ISM Code. 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. Our Company along with a number of vessels are certified under the 9001 & 14001 ISO standards, and as such, are fully compliant with the additional requirements and restrictions that have been set. We are committed to conducting our operations systematically by following the requirements of the ISO 14001 striving to maintain ZERO Oil Spills and ZERO Marine and Pollution Atmospheric Incidents. Our Company is also committed to responding timely and effectively to environmental incidents resulting from our operations, respecting the environment by emphasizing every employee’s responsibility in environmental performance and fostering appropriate operating practices and training, managing our business with the goal of preventing environmental incidents and controlling emissions and wastes to below harmful levels, using energy, water, materials and other natural resources as efficiently as possible, giving particular regard to the long-term sustainability of consumable items and minimizing waste by reducing our waste generation.

 

 50 
Table of Contents

 

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 certificates are required by the IMO. The document of compliance and safety management certificate are periodically reviewed and renewed as required.

In line with the best practices that the Company applies throughout onboard and ashore procedures, the SMS has been developed to fully comply with the Dry-BMS standards set out by Rightship.

Specialization and accuracy being the key to this, the Company has developed two plans for ashore procedures and seven plans for onboard procedures, targeting the responsible personnel and crew members, respectively.

Amendments to the SOLAS Convention Chapter VII apply to vessels transporting dangerous goods and require those vessels be in compliance with the International Maritime Dangerous Goods Code (“IMDG Code”). 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. Later amendments revised the IMDG Code to reflect the UN Recommendations on the Transport of Dangerous Goods, including (1) new provisions regarding IMO type 9 tank, (2) new abbreviations for segregation groups, and (3) special provisions for carriage of lithium batteries and of vehicles powered by flammable liquid or gas. The amendments, which entered into force on June 1, 2022, include (1) addition of a definition of dosage rate, (2) additions to the list of high consequence dangerous goods, (3) new provisions for medical/clinical waste, (4) addition of various ISO standards for gas cylinders, (5) a new handling code, and (6) changes to stowage and segregation provisions. The newest edition of the IMDG Code will take effect on January 1, 2024, although the changes are largely incremental.

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

The IMO’s Maritime Safety Committee and MEPC, respectively, each adopted relevant parts of the International Code for Ships Operating in Polar Water (the “Polar Code”). The Polar Code, covers design, construction, equipment, operational, training, search and rescue as well as environmental protection matters relevant to ships operating in the waters surrounding the two poles. It also includes mandatory measures regarding safety and pollution prevention as well as recommendatory provisions. The Polar Code applies to new ships constructed after January 1, 2017, and ships constructed before January 1, 2017 are required to meet the relevant requirements by the earlier of their first intermediate or renewal survey.

On January 1, 2021, IMO Resolution MSC. 428(98) came into force. This regulation is applicable to all vessels, requiring ships to include cyber risk management in their safety management systems in accordance with the International Safety Management (ISM) Code. This resolution further encourages flag administrations to ensure that ship owners and managers are properly addressing cyber risks. In February 2021, the U.S. Coast Guard published guidance on addressing cyber risks in a vessel’s safety management system. This might cause companies to create additional procedures for monitoring cybersecurity, which could require additional expenses and/or capital expenditures. Our Company has already taken the necessary steps to ensure data integrity and full compliance both from the office side and on board our vessels. The Company is in the process of becoming fully certified for ISO27001, with the first stage already completed. The vessels are being monitored under the existing cybersecurity requirements required by the IMO as well as the additional best practices by other entities. Each vessel has a ship-specific cybersecurity plan, and its IT and OT systems have been inventoried in order for the relevant hazards to be identified.

 

 51 
Table of Contents

 

 A ship specific plan has been developed for each vessel covering the requirements according to the updated regulations as well as additional precautions to be maintained on multiple accounts. Detailed pieces of information have been added, pertaining to the software and cybersecurity on board, and additional measures have been taken to protect the integrity of our vessels. Specific policies have been developed to that effect, such as cybersecurity, email usage, password, device, workstation policies, etc. Very specific guidelines have been provided to the Masters and crew members regarding their engagement with relevant authorities in order for the cyber requirements to be fulfilled at all times.

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 an International Convention for the Control and Management of Ships’ Ballast Water and Sediments (the “BWM Convention”), which entered into force on September 8, 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.

On December 4, 2013, the IMO Assembly passed a resolution revising the application dates of the BWM Convention so that the dates are triggered by the entry into force date and not the dates originally in the BWM Convention. This, in effect, makes all vessels delivered before the entry into force date “existing vessels” and allows for the installation of ballast water management systems on such vessels at the first International Oil Pollution Prevention (“IOPP”) renewal survey following entry into force of the convention. As part of our commitment to comply with the international regulation, we are progressively installing BWTS in our fleet.

The MEPC adopted updated guidelines for approval of ballast water management systems (G8) at MEPC 70. At MEPC 72, amendments were adopted to extend the date existing vessels are subject to certain ballast water standards. Ships over 400 gross tons generally must comply with a “D-1 standard,” requiring the exchange of ballast water only in open seas and away from coastal waters. The “D-2 standard” specifies the maximum amount of viable organisms allowed to be discharged, and compliance dates vary depending on the IOPP renewal dates. Depending on the date of the IOPP renewal survey, existing vessels must comply with the D-2 standard on or after September 8, 2019. For most ships, compliance with the D-2 standard will involve installing on-board systems to treat ballast water and eliminate unwanted organisms. Ballast water management systems, which include systems that make use of chemical, biocides, organisms or biological mechanisms, or which alter the chemical or physical characteristics of the ballast water, must be approved in accordance with IMO Guidelines (Regulation D-3). As of October 13, 2019, MEPC 72’s amendments to the BWM Convention have been in effect, making the Code for Approval of Ballast Water Management Systems, which governs assessment of ballast water management systems, mandatory rather than permissive, and formalizing an implementation schedule for the D-2 standard. Under these amendments, all ships must meet the D-2 standard by September 8, 2024. Costs of compliance with these regulations may be substantial.

We have developed and implemented the required BWTS in our fleet and are in compliance with all the applicable regulations.

Once mid-ocean ballast exchange or ballast water treatment requirements become mandatory under the BWM Convention, the cost of compliance could increase for ocean carriers and may have a material effect on our operations. Irrespective of the BWM convention, certain countries such as the U.S. have enforced and implemented regional requirement related to the system certification, operation and reporting.

 

 52 
Table of Contents

 

The IMO also adopted the International Convention on Civil Liability for Bunker Oil Pollution Damage (the “Bunker Convention”) to impose strict liability on ship owners (including the registered owner, bareboat charterer, manager or operator) for pollution damage in jurisdictional waters of ratifying states caused by discharges of bunker fuel. 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.

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 neither the International Convention on Civil Liability for Oil Pollution Damage (which imposes liability for oil pollution damage resulting from maritime casualties involving oil-carrying ships on the owner of the ship) nor the Bunker Convention have 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. Our vessels are all currently holders of these certificates issued by the respective flag administrations, based on the evidence of coverage issued by the respective P&I clubs.

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.” The Anti-fouling Convention, which entered into force on September 17, 2008, prohibits the use of organotin compound coatings to prevent the attachment of mollusks and other sea life to the hulls of vessels. Vessels of over 400 gross tons engaged in international voyages are also 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.

MEPC 75 approved amendments to the Anti-fouling Convention to prohibit anti-fouling systems containing cybutryne, which have been in effect since January 1, 2023. For ships already bearing such an anti-fouling system, compliance is required at the next scheduled renewal of the system after that date, but no later than 60 months following the last application to the ship of such a system. In addition, the International Anti-fouling System (IAFS) Certificate has been updated to address compliance options for anti-fouling systems to address cybutryne. Ships which are affected by this ban on cybutryne must receive an updated IAFS Certificate no later than two years after the entry into force of these amendments. Ships which are not affected (i.e. with anti-fouling systems which do not contain cybutryne) must receive an updated IAFS Certificate at the next Anti-fouling application to the vessel. Our fleet already complies with this regulation.

We have obtained Anti-fouling System Certificates for all of our vessels that are subject to the Anti-fouling Convention.

Further to the above and in continuation of enhanced bio-fouling requirements in Australia and New Zealand, the vessels are undergoing stricter review, compliance and corresponding record keeping processes, and inspections are becoming increasingly frequent and demanding.

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 EU authorities have indicated that vessels not in compliance with the ISM Code by applicable deadlines will be prohibited from trading in U.S. and EU ports, respectively. As of the date of this annual report, each of our vessels is ISM Code certified. 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.

 

 53 
Table of Contents

 

United States Regulations

The U.S. Oil Pollution Act of 1990 (“OPA”) established an extensive regulatory and liability regime for the protection and cleanup of the environment from oil spills. OPA affects all “owners and operators” whose vessels trade 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 (“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.

OPA contains statutory caps on liability and damages; such caps do not apply to direct cleanup costs. As of March 23, 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 as required by law where the responsible party knows or has reason to know of the incident; (ii) reasonably cooperate and assist as requested in connection with oil removal activities; or (iii) without sufficient cause, comply with an order issued under the Federal Water Pollution Act (Section 311 (c), (e)) or the Intervention on the High Seas Act.

CERCLA contains a similar liability regime whereby owners and operators of vessels are liable for cleanup, 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.

 

 54 
Table of Contents

 

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. All of our vessels arriving at U.S. or Canadian ports are covered under a COFR - Certificate 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 (“BSEE”) revised Production Safety Systems Rule (“PSSR”), effective December 27, 2018, modified and relaxed certain environmental and safety protections under the 2016 PSSR. Additionally, the BSEE amended the Well Control Rule, effective July 15, 2019, which rolled back certain reforms regarding the safety of drilling operations, and former U.S. President Trump had proposed leasing new sections of U.S. waters to oil and gas companies for offshore drilling. Subsequently, current U.S. President Biden signed an executive order temporarily blocking new leases for oil and gas drilling in federal waters. However, attorney generals from 13 states filed suit in March 2021 to lift the executive order, and in June 2021, a federal judge in Louisiana granted a preliminary injunction against the Biden administration, stating that the power to pause offshore oil and gas leases “lies solely with Congress.” With these rapid changes, compliance with any new requirements of OPA and future legislation or regulations applicable to the operation of our vessels could 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 and its vessels that call at U.S. ports are all covered under the QI (Qualified Individual) and engagement with Witt O’Briens and their ongoing contract with the USCG which provide us with the latest updates and legislations and are in charge of updating our manuals pertaining to the relevant requirements. In addition, we are also covered through our contracts with the National Response Corporation for Oil Spill Response Organization purposes and with T&T Salvage, LLC for Salvage & Marine Fire-Fighting.

We currently maintain pollution liability coverage insurance in the amount of $1.0 billion per incident for each of our vessels. If the damages from a catastrophic spill were to exceed our insurance coverage, it could have an adverse effect on our business and results of operation. Cybersecurity is also a top priority for the U.S. Coast Guard. The cybersecurity of our vessels continues to improve through hands-on training, campaigns and external assistance/equipment provision.

 

 55 
Table of Contents

 

Other United States Environmental Initiatives

The U.S. Clean Air Act of 1970 (including its amendments of 1977 and 1990) (“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 (“SIPs”), some of which regulate emissions resulting from vessel loading and unloading operations which may affect our vessels.

The U.S. Clean Water Act (“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” (“WOTUS”), thereby expanding federal authority under the CWA. Following litigation on the revised WOTUS rule, in December 2018, the EPA and Department of the Army proposed a revised, limited definition of WOTUS. In 2019 and 2020, the agencies repealed the prior WOTUS Rule and promulgated the Navigable Waters Protection Rule (“NWPR”) which significantly reduced the scope and oversight of EPA and the Department of the Army in traditionally non-navigable waterways. On August 30, 2021, a federal district court in Arizona vacated the NWPR and directed the agencies to replace the rule. On December 7, 2021, the EPA and the Department of the Army proposed a rule that would reinstate the pre-2015 WOTUS definition, and on January 18, 2023, the EPA issued a revised final rule that used the pre-2015 definition as its foundation. However, pursuant to a 2023 decision of the U.S. Supreme Court in Sackett v. Environmental Protection Agency affecting the permissible scope of the WOTUS definition, in August 2023 the EPA issued a final rule furthering amending and narrowing the definition of WOTUS.

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 regulates 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 (“VIDA”). VIDA established a new framework for the regulation of vessel incidental discharges under CWA, required the EPA to develop performance standards for those discharges and required the USCG to develop implementation, compliance and enforcement regulations. Non-military, non- recreational vessels greater than 79 feet in length must continue to comply with the requirements of the VGP, including submission of a Notice of Intent (“NOI”) or retention of a PARI form and submission of annual reports.

All of our vessels submit their NOIs/eNOIs to the USCG and their flag administration accordingly within the required timeframes. Compliance with the EPA, USCG and state regulations could require the installation of ballast water treatment equipment on our vessels or the implementation of other port facility disposal procedures at potentially substantial cost, or may otherwise restrict our vessels from entering U.S. waters.

European Union Regulations

In October 2009, the EU 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 29 April 2015 (amending EU Directive 2009/16/EC) 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.

 

 56 
Table of Contents

 

The EU 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 EU 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 EU 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. The EU Directive 2005/33/EC (amending Directive 1999/32/EC) introduced requirements parallel to those in Annex VI relating to the sulfur content of marine fuels. In addition, the EU imposed a 0.1% maximum sulfur requirement for fuel used by ships at berth in the Baltic, the North Sea and the English Channel (the so called “SOx-Emission Control Area”), and, beginning May 1, 2025, in the Mediterranean Sea. As of January 2020, EU member states must also ensure that ships in all EU waters, except the SOx-Emission Control Area, use fuels with a 0.5% maximum sulfur content.

On September 15, 2020, the European Parliament voted to include greenhouse gas emissions from the maritime sector in the European Union’s carbon market. On December 18, 2022, the European Parliament formally agreed to include the maritime sector beginning in 2024. Effective January 2024, the EU ETS was extended to cover CO2 emissions from all ships of 5,000 gross tonnage and above entering EU ports, regardless of the flag they fly. The system covers: a) 50% of emissions from voyages starting or ending outside of the EU (allowing the third country to decide on appropriate action for the remaining share of emissions) and b) 100% of emissions that occur between two EU ports and when ships are within EU ports. The EU ETS covers CO2 (carbon dioxide), CH4 (methane) and N2O (nitrous oxide) emissions, but the two latter only as from 2026. Shipping companies will need to surrender to the relevant EU authorities the allowances that correspond to the emissions covered by the system. These allowances are normally purchased by the entity responsible for the purchase of bunkers, i.e. the charterers in the case of time charter agreements. In the case of voyage charter agreements, the cost of the allowances is normally included in the charter rate. Our actions in preparation for the EU ETS regulation target CO2 emissions reductions by implementing and continuing to adopt measures to decarbonize our fleet and improve the Carbon Intensity Indicator (“CII”) and the minimization of financial impact by the inclusion of a clause in our charter party agreements which imposes an obligation on the charterer to cover the cost associated with the CO2 emissions generated during voyages to and from and within the EU.

 

The EU aims to substantially increase the use of renewable and low-carbon fuels to reduce the carbon footprint of the maritime sector. On March 23, 2023, the European Parliament and the Council agreed on FuelEU Maritime, a new EU regulation that includes a provision, among others, to gradually decrease over time the greenhouse gas intensity of fuels used by the shipping sector, by 2% in 2025 to as much as 80% by 2050.

 

Chinese Regulations

Our Company complies with the local Chinese regulations and requirements pertaining to the Ship Pollution Response Organization. This requires owners/operators of (a) any ship carrying polluting and hazardous cargoes in bulk or (b) any other vessel above 10,000 GT to enter into a pollution clean-up contract with a Maritime Safety Agency (“MSA”) approved Ship Pollution Response Organization before the vessel enters a Chinese port. We have established contractual agreements and are cooperating with our local representatives, to provide us the best in market options at each specific port. This practically applies to all the managed vessel within our fleets and means that we are getting high-quality service on a case by case basis, always obtaining the best price versus quality result that could be procured.

International Labor Organization

The International Labor Organization (the “ILO”) is a specialized agency of the UN that has adopted the Maritime Labor Convention 2006 (“MLC 2006”). A Maritime Labor Certificate and a Declaration of Maritime Labor Compliance are required to ensure compliance with the MLC 2006 for all ships that are 500 gross tonnage or over and are either engaged in international voyages or flying the flag of a Member and operating from a port, or between ports, in another country. All of our vessels have been awarded an MLC certificate following the relevant MLC inspection carried out on board and they have been approved for DMLC Part II by the ROs/flag administration in compliance with the requirements set out in the DMLC Part I issued by the respective flag administrations accordingly.

 

 57 
Table of Contents

 

The Company fully complies with the financial responsibility and abandonment clauses of the regulatory framework.

Vessel Security Regulations

Since the terrorist attacks of September 11, 2001 in the United States, there have been a variety of initiatives in various jurisdictions intended to enhance vessel security such as the U.S. Maritime Transportation Security Act of 2002 (“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 Facility Security Code (“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 (“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.

All of our vessels are already fully compliant with the ISPS code and have the International Ship Security Certificate (ISSC). Each vessel also has its own SSP (Ship Security Plan) which has been reviewed and approved by the RO/flag administration accordingly. In addition to the above, the Company has also chosen to comply with BMP5 standard as best management practices and also provides additional security equipment (and armed guards, where required) on board whenever our vessels pass through areas of voluntary reporting or where there is high risk of piracy. Future security measures could also have a significant financial impact on us. 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 affect our business. Costs are incurred in taking additional security measures in accordance with Best Management Practices to Deter Piracy, notably those contained in the BMP5 industry standard.

 

 58 
Table of Contents

 

Inspection by Flag Administration and 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 contracted for construction 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., Bureau Veritas, NKK, DNV-GL, American Bureau of Shipping, Lloyd’s Register of Shipping). Their respective Classification certificates have been issued by the vessel’s classification society following the initial survey carried out on board.

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 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.

The managed vessels, depending on the flag administration requirements, are inspected during the stipulated periodicities. These inspections are arranged on a timely basis and the findings (if any) are addressed for corrective actions, close-out and acceptance purposes. The findings are also finally reviewed by the relevant flag administration, in order to record the actions taken by the Company and close-out the findings on their systems.

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 mishaps, 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 and Machinery Insurance

We procure hull and machinery insurance, protection and indemnity insurance, which includes environmental damage and pollution insurance and war risk insurance and freight, demurrage and defense insurance for our fleet. We generally do not maintain insurance against loss of hire (except for certain charters for which we consider it appropriate), which covers business interruptions that result in the loss of use of a vessel.

 

 59 
Table of Contents

 

Protection and Indemnity Insurance

Protection and indemnity insurance is provided by mutual protection and indemnity associations, or “P&I Associations,” and covers our third- party liabilities in connection with our shipping activities. This includes third-party liability and other related expenses of injury 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, pollution arising from oil or other substances and 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 current protection and indemnity insurance coverage for pollution is $1 billion per vessel per incident. The 13 P&I Associations that comprise the International Group insure approximately 90% of the world’s commercial tonnage and have entered into a pooling agreement to reinsure each association’s liabilities. The International Group’s website states that the Pool provides a mechanism for sharing all claims in excess of $10 million up to, currently, approximately $8.2 billion. As a member of a P&I Association, 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.

Compliance with Environmental Regulations

Other aspects of our environmental compliance include:

Refrigerant Allowance: We have banned all the types of refrigerants that significantly affect the ozone layer such as R22 in order to reduce the Global Warming Potential (GWP). Additionally, during maintenance activities both in our offices and on vessels, we use eco-friendly refrigerants that do not affect the ozone layer such as R407 and R404. In compliance with EU 517/2014 regulation, which stipulates restrictions to the use of refrigerants exceeding GWP of 2500, we use eco-friendly refrigerants in 30% of our fleet and we expect that 100% of our fleet will have installed eco-friendly refrigerants within the next 5 years.
Biodegradable Lubricants: We are using biodegradable lubricants proactively in the majority of our fleet regardless of their destination. Biodegradable lubricants are eco-friendly lubricants which are mandatory for vessels that transport cargo or have the United States as destination ports.
We had proactively taken immediate steps to comply in 2019 with certain provisions of EU regulation (1257/2013 on Ship recycling) that took effect on December 31, 2020. The regulation refers to vessel recycling activities and the identification and monitoring of hazardous materials, including:
Asbestos.
PCBs.
Ozone depleting substances.
PFOS.
Anti-fouling systems containing organotin compounds as a biocide.

We are also in the process of replacing Freon onboard. Our entire fleet complies with Hazardous Material regulation.

 

 60 
Table of Contents

 

Dry-BMS (RightShip Standards)

This program, in which we participate on a voluntary basis and have been successfully audited for compliance achievement, is designed to allow ship managers to measure their SMS against agreed industry standards, with the aim of improving fleet performance and risk management. This will ensure that policies align with the industry’s best practice to both advance our vessels’ performance and attain high standards of health, safety, security and pollution prevention.

The draft guidelines focus on 30 areas of management practice across the four most serious risk areas faced in vessel operations: performance, people, plant and process. This grades the excellence of a company’s SMS against measurable expectations and targets without involving the burdens of excessive inspections. This standard is not meant to replace any pre-existing system or rule but rather to enhance their existing application and raise the levels of excellence achieved. The minimum benefits of this venture would a) cover all relevant ship management issues in one document, b) be relevant to the entire dry bulk shipping industry worldwide, c) complement other statutory requirements and industry guidance and d) be frequently evaluated to drive continuous improvement across the management companies on an international level.

Further to the above, RightShip has adjusted their inspection questionnaires in order to review the vessels’ compliance with the Dry-BMS standards, which are now in full effect and applied on board. 

C.       Organizational Structure

As of December 31, 2023, we are the sole owner of all of the outstanding shares of the subsidiaries listed in Note 1 of our consolidated financial statements under “Item 18. Financial Statements.”

D.       Property, Plant and Equipment

We do not own any material real property. Our interests in the vessels in our fleet are our only material properties. See “Item 4. Information on the Company –– B. Business Overview –– General.”

Item 4A.Unresolved Staff Comments

None.

Item 5.Operating and Financial Review and Prospects

The following management’s discussion and analysis of financial condition and results of operations should be read in conjunction with “Item 4. Information on the Company-B. Business Overview” and our historical consolidated financial statements and accompanying notes included elsewhere in this annual report. This discussion contains forward-looking statements that reflect our current views with respect to future events and financial performance. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, such as those set forth in “Item 3. Key Information-D. Risk Factors” and elsewhere in this annual report.

We are a global shipping company with extensive operational experience that owns and operates a fleet of dry bulk carrier vessels. Our vessels transport a broad range of major and minor bulk commodities, including ores, coal, grains and fertilizers, along worldwide shipping routes.

 

 61 
Table of Contents

 

A.       Operating Results

We deploy our vessels on a mix of short to medium time charters or voyage charters, contracts of affreightment, or in dry bulk carrier pools, according to our assessment of market conditions. We adjust the mix of these charters to take advantage of the relatively stable cash flow and high utilization rates associated with medium to long-term time charters, or to profit from attractive spot charter rates during periods of strong charter market conditions, or to maintain employment flexibility that the spot market offers during periods of weak charter market conditions.

Key Performance Indicators

Our business consists primarily of:

employment and operation of dry bulk vessels constituting our operating fleet; and
management of the financial, general and administrative elements involved in the conduct of our business and ownership of dry bulk vessels constituting our operating fleet.
The employment and operation of our vessels require the following main components:
vessel maintenance and repair;
crew selection and training;
vessel spares and stores supply;
contingency response planning;
onboard safety procedures auditing;
accounting;
vessel insurance arrangement;
vessel chartering;
vessel security training and security response plans pursuant to the requirements of the ISPS Code;
obtaining ISM Code certification and audits for each vessel within the six months of taking over a vessel;
vessel hire management;
vessel surveying; and
vessel performance monitoring.

 

 62 
Table of Contents

 

The management of financial, general and administrative elements involved in the conduct of our business and ownership of our vessels requires the following main components:

management of financial resources, including banking relationships (i.e. administration of bank loans and bank accounts);
   
management of our accounting system and records and financial reporting;
   
administration of the legal and regulatory requirements affecting our business and assets; and
   
management of the relationships with our service providers and customers.

 

The principal factors that affect our profitability, cash flows and shareholders’ return on investment include:

·charter rates and duration of our charters;
·age, condition and specifications of our vessels;
·levels of vessel operating expenses;
·depreciation and amortization expenses;
·fuel costs;
·financing costs; and
·fluctuations in foreign exchange rates.

 63 
Table of Contents