Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2014 | |
Document And Entity Information | |
Document Type | 20-F |
Document Period End Date | 31-Dec-14 |
Amendment Flag | FALSE |
Entity Registrant Name | Paragon Shipping Inc. |
Entity Central Index Key | 1401112 |
Trading Symbol | PRGN |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Current Fiscal Year End Date | -19 |
Entity Filer Category | Accelerated Filer |
Entity Well Known Seasoned Issuer | No |
Entity Common Stock Shares Outstanding | 24,809,142 |
Document Fiscal Year Focus | 2014 |
Document Fiscal Period Focus | FY |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets | ||
Cash and cash equivalents | $7,030,507 | $31,301,957 |
Restricted cash | 6,929,172 | 325,000 |
Trade receivables, net | 7,021,588 | 8,536,240 |
Other receivables | 1,273,132 | 599,988 |
Prepaid expenses | 503,109 | 549,276 |
Due from related parties | 843,510 | 146,051 |
Inventories | 2,131,464 | 1,145,243 |
Marketable securities | 955,535 | 1,616,329 |
Total current assets | 26,688,017 | 44,220,084 |
Fixed assets | ||
Vessels, net | 369,032,973 | 306,135,916 |
Advances for vessels under construction | 49,971,703 | 45,209,166 |
Other fixed assets, net | 922,565 | 595,840 |
Total fixed assets, net | 419,927,241 | 351,940,922 |
Investment in affiliate | 2,956,250 | 11,309,375 |
Interest rate swaps | 66,475 | 87,295 |
Other assets | 4,367,134 | 2,303,304 |
Restricted cash | 6,960,000 | 9,685,000 |
Total Assets | 460,965,117 | 419,545,980 |
Current liabilities | ||
Trade accounts payable | 2,766,734 | 2,543,468 |
Accrued expenses | 4,012,238 | 2,054,903 |
Due to related parties | 166,354 | 82,074 |
Interest rate swaps | 589,896 | 980,465 |
Deferred income | 233,245 | 737,251 |
Current portion of long-term debt | 20,714,324 | 17,257,750 |
Total current liabilities | 28,482,791 | 23,655,911 |
Long-term liabilities | ||
Long-term debt | 210,064,414 | 162,857,176 |
Interest rate swaps | 17,369 | 382,116 |
Total long-term liabilities | 210,081,783 | 163,239,292 |
Total Liabilities | 238,564,574 | 186,895,203 |
Commitments and Contingencies | 0 | 0 |
Shareholders' Equity | ||
Preferred shares, $0.001 par value; 25,000,000 authorized; none issued and outstanding | 0 | 0 |
Class A common shares, $0.001 par value; 750,000,000 authorized; 17,669,442 and 24,809,142 issued and outstanding at December 31, 2013 and 2014, respectively | 24,809 | 17,669 |
Class B common shares, $0.001 par value; 5,000,000 authorized; none issued and outstanding | 0 | 0 |
Additional paid-in capital | 535,233,573 | 493,803,591 |
Accumulated other comprehensive loss | -150,986 | -259,811 |
Accumulated deficit | -312,706,853 | -260,910,672 |
Total Shareholders' Equity | 222,400,543 | 232,650,777 |
Total Liabilities and Shareholders' Equity | $460,965,117 | $419,545,980 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parentheticals) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Class of Stock | ||
Preferred stock par value | $0.00 | $0.00 |
Preferred stock shares authorized | 25,000,000 | 25,000,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Common stock - shares authorized | 755,000,000 | |
Common Shares - Class A | ||
Class of Stock | ||
Common stock - par value | $0.00 | $0.00 |
Common stock - shares authorized | 750,000,000 | 750,000,000 |
Common stock - shares issued | 24,809,142 | 17,669,442 |
Common stock - shares outstanding | 24,809,142 | 17,669,442 |
Common Shares - Class B | ||
Class of Stock | ||
Common stock - par value | $0.00 | $0.00 |
Common stock - shares authorized | 5,000,000 | 5,000,000 |
Common stock - shares issued | 0 | 0 |
Common stock - shares outstanding | 0 | 0 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Revenue | |||
Charter revenue | $58,138,104 | $59,530,645 | $53,218,975 |
Commissions (including related party of $646,987, $750,533 and $708,153 in 2012, 2013 and 2014, respectively) | -3,374,426 | -3,273,889 | -2,918,296 |
Net Revenue | 54,763,678 | 56,256,756 | 50,300,679 |
Expenses / (Income) | |||
Voyage expenses, net | 14,744,648 | 6,668,998 | 1,855,964 |
Vessels operating expenses (including related party of $660,474, $797,143 and $1,282,699 in 2012, 2013 and 2014, respectively) | 22,666,036 | 20,758,513 | 18,808,084 |
Dry-docking expenses (including related party of $0, $109,248 and $123,840 in 2012, 2013 and 2014, respectively) | 2,193,110 | 1,698,217 | 0 |
Management fees - related party | 6,266,270 | 5,874,416 | 4,094,744 |
Depreciation | 18,357,377 | 16,986,584 | 16,386,426 |
General and administrative expenses (including related party of $3,304,116, $7,670,556 and $5,775,899 in 2012, 2013 and 2014, respectively) | 8,707,819 | 10,764,001 | 7,901,762 |
Impairment loss | 15,695,282 | 0 | 0 |
Bad debt provisions | 130,720 | 0 | 124,717 |
Gain from sale of assets (net of vessel sale & purchase commissions to related party of $0, $0, and $745,000 in 2012, 2013 and 2014, respectively) | -402,805 | 0 | 0 |
Gain from vessel early redelivery | 0 | -2,267,818 | 0 |
Loss from contract cancellation (including related party of $0, $444,421 and $0 in 2012, 2013 and 2014, respectively) | 0 | 568,658 | 0 |
(Gain) / loss from marketable securities, net | 25,529 | -1,202,094 | -414,235 |
Other (income) / loss | 210,709 | -638,374 | -750,715 |
Operating Income / (Loss) | -33,831,017 | -2,954,345 | 2,293,932 |
Other Income / (Expenses) | |||
Interest and finance costs | -9,324,395 | -7,440,190 | -6,744,917 |
Loss on derivatives, net | -387,740 | -95,288 | -714,074 |
Interest income (including related party of $675,856, $504,326 and $0 in 2012, 2013 and 2014, respectively) | 20,940 | 531,028 | 728,503 |
Equity in net income of affiliate | 471,079 | 1,652,339 | 1,986,590 |
Gain from debt extinguishment | 0 | 0 | 1,893,254 |
Loss on investment in affiliate | -8,840,343 | -8,620,372 | -16,985,066 |
Foreign currency (loss) / gain | 95,295 | -26,204 | -15,347 |
Total Other Expenses, net | -17,965,164 | -13,998,687 | -19,851,057 |
Net Loss | -51,796,181 | -16,953,032 | -17,557,125 |
Other Comprehensive Income / (Loss) | |||
Unrealized (loss) / gain on cash flow hedges | 131,238 | 131,112 | -847,943 |
Transfer of realized loss on cash flow hedges to "Interest and finance costs" | 98,656 | 312,069 | 174,869 |
Equity in other comprehensive (loss) / income of affiliate | 16,139 | 77,165 | -107,083 |
Unrealized loss on change in fair value of marketable securities | -162,737 | -2,064,265 | -827,377 |
Transfer of loss on change in fair value of marketable securities to "(Gain) / loss from marketable securities, net" | 25,529 | 1,911,212 | 980,430 |
Total Other Comprehensive (Loss) / Income | 108,825 | 367,293 | -627,104 |
Comprehensive Loss | ($51,687,356) | ($16,585,739) | ($18,184,229) |
Loss per Class A common share, basic and diluted | ($2.18) | ($1.31) | ($2.84) |
Weighted average number of Class A common shares, basic and diluted | 23,326,062 | 12,639,128 | 6,035,910 |
Consolidated_Statements_of_Com1
Consolidated Statements of Comprehensive Loss (Parentheticals) (Related Party, USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Related Party | |||
Commissions related party | $708,153 | $750,533 | $646,987 |
Vessels operating expenses related party | 1,282,699 | 797,143 | 660,474 |
Dry-docking expenses related party | 123,840 | 109,248 | 0 |
General and administrative expenses related party | 5,775,899 | 7,670,556 | 3,304,116 |
Vessel sale & purchase commissions related party | 745,000 | 0 | 0 |
Loss from contract cancellation related party | 0 | 444,421 | 0 |
Interest income related party | $0 | $504,326 | $675,856 |
Consolidated_Statements_of_Sha
Consolidated Statements of Shareholders' Equity (USD $) | Total | Class A Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Balance at Dec. 31, 2011 | $221,224,147 | $6,090 | $447,618,572 | $0 | ($226,400,515) |
Shares issued, beginning balance at Dec. 31, 2011 | 6,089,826 | ||||
Issuance of Class A common shares | 9,943,893 | 4,902 | 9,938,991 | ||
Issuance of Class A common shares (number of shares) | 4,901,961 | ||||
Issuance of non-vested Class A common share awards | 10 | -10 | |||
Issuance of non-vested Class A common share awards (number of shares) | 9,800 | ||||
Cancellation of non-vested Class A common share awards | -1 | 1 | |||
Cancellation of non-vested Class A common share awards (number of shares) | -184 | ||||
Share based compensation | 2,536,702 | 2,536,702 | |||
Net Loss | -17,557,125 | -17,557,125 | |||
Other comprehensive (loss) / income | -627,104 | -627,104 | |||
Balance at Dec. 31, 2012 | 215,520,513 | 11,001 | 460,094,256 | -627,104 | -243,957,640 |
Shares issued, ending balance at Dec. 31, 2012 | 11,001,403 | ||||
Issuance of Class A common shares | 31,860,750 | 6,218 | 31,854,532 | ||
Issuance of Class A common shares (number of shares) | 6,218,039 | ||||
Issuance of non-vested Class A common share awards | 450 | -450 | |||
Issuance of non-vested Class A common share awards (number of shares) | 450,000 | ||||
Share based compensation | 1,855,253 | 1,855,253 | |||
Net Loss | -16,953,032 | -16,953,032 | |||
Other comprehensive (loss) / income | 367,293 | 367,293 | |||
Balance at Dec. 31, 2013 | 232,650,777 | 17,669 | 493,803,591 | -259,811 | -260,910,672 |
Shares issued, ending balance at Dec. 31, 2013 | 17,669,442 | ||||
Issuance of Class A common shares | 39,741,152 | 6,921 | 39,734,231 | ||
Issuance of Class A common shares (number of shares) | 6,920,700 | ||||
Cancellation of Class A common shares | -170,461 | -30 | -170,431 | ||
Cancellation of Class A common shares (number of shares) | -30,000 | ||||
Issuance of non-vested Class A common share awards | 252 | -252 | |||
Issuance of non-vested Class A common share awards (number of shares) | 252,000 | ||||
Cancellation of non-vested Class A common share awards | -3 | 3 | |||
Cancellation of non-vested Class A common share awards (number of shares) | -3,000 | ||||
Share based compensation | 1,866,431 | 1,866,431 | |||
Net Loss | -51,796,181 | -51,796,181 | |||
Other comprehensive (loss) / income | 108,825 | 108,825 | |||
Balance at Dec. 31, 2014 | $222,400,543 | $24,809 | $535,233,573 | ($150,986) | ($312,706,853) |
Shares issued, ending balance at Dec. 31, 2014 | 24,809,142 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Cash flows from operating activities | |||
Net Loss | ($51,796,181) | ($16,953,032) | ($17,557,125) |
Adjustments to reconcile net loss to net cash provided by operating activities | |||
Depreciation | 18,357,377 | 16,986,584 | 16,386,426 |
Impairment loss | 15,695,282 | 0 | 0 |
Loss on investment in affiliate | 8,840,343 | 8,620,372 | 16,985,066 |
Gain from sale of assets | -402,805 | 0 | 0 |
Amortization and write off of financing costs | 2,108,716 | 941,733 | 447,573 |
Bad debt provisions | 130,720 | 0 | 124,717 |
Share based compensation | 1,866,431 | 1,855,253 | 2,536,702 |
Write off of capitalized expenses from contract cancellation | 0 | 232,495 | 0 |
(Gain) / loss from marketable securities, net | 25,529 | -1,202,094 | -414,235 |
Gain from debt extinguishment | 0 | 0 | -1,893,254 |
Unrealized gain on interest rate swaps | -504,602 | -834,829 | -2,017,297 |
Equity in net income of affiliate, net of dividends received | -471,079 | 0 | 1,202,991 |
Changes in assets and liabilities: | |||
Trade receivables, net | 1,383,932 | -6,475,787 | -1,334,013 |
Other receivables | -673,144 | 129,779 | 97,564 |
Prepaid expenses | 46,167 | -103,672 | 157,502 |
Inventories | -868,623 | -221,313 | -9,444 |
Due from related parties | -861,314 | 2,336,607 | -1,587,798 |
Trade accounts payable | 75,994 | -64,969 | 148,323 |
Accrued expenses | 1,285,140 | 148,956 | -467,604 |
Due to related parties | 84,280 | -2,631 | 84,705 |
Deferred income | -504,006 | -829,756 | 486,010 |
Net cash from / (used in) operating activities | -6,181,843 | 4,563,696 | 13,376,809 |
Cash flow from investing activities | |||
Net proceeds from sale of assets | 9,995,000 | 0 | 0 |
Acquisition of vessels and capital expenditures | -110,664,356 | -20,368,088 | -32,042,752 |
Proceeds from the sale of marketable securities | 498,056 | 0 | 0 |
Repayment from affiliate | 0 | 14,000,000 | 1,000,000 |
Return of investment in affiliate | 0 | 135,160 | 522,918 |
Other fixed assets | -496,093 | -208,567 | -172,410 |
Release of / (increase in) restricted cash | -3,879,172 | 0 | 14,990,000 |
Net cash used in investing activities | -104,546,565 | -6,441,495 | -15,702,244 |
Cash flows from financing activities | |||
Proceeds from long-term debt | 179,144,427 | 0 | 28,908,750 |
Repayment of long-term debt | -128,480,615 | -15,427,250 | -32,758,319 |
Purchase of treasury stock | -170,460 | 0 | 0 |
Payment of financing costs | -3,777,546 | -912,441 | -673,709 |
Proceeds from the issuance of Class A common shares | 42,235,790 | 34,500,000 | 10,000,000 |
Class A common shares offering costs | -2,494,638 | -2,657,438 | -37,919 |
Net cash from financing activities | 86,456,958 | 15,502,871 | 5,438,803 |
Net increase / (decrease) in cash and cash equivalents | -24,271,450 | 13,625,072 | 3,113,368 |
Cash and cash equivalents at the beginning of the period | 31,301,957 | 17,676,885 | 14,563,517 |
Cash and cash equivalents at the end of the period | 7,030,507 | 31,301,957 | 17,676,885 |
Supplemental disclosure of cash flow information | |||
Cash paid during the period for interest (excluding capitalized interest) | 5,000,188 | 5,201,707 | 5,122,625 |
Non-cash investing activities - unpaid capital expenditures for acquisition of vessels | 572,561 | 0 | 0 |
Non-cash financing activities - unpaid financing costs | $395,000 | $0 | $269,616 |
Basis_of_Presentation_and_Gene
Basis of Presentation and General Information | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Basis of Presentation and General Information [Abstract] | |||||||
Basis of Presentation and General Information | 1.Basis of Presentation and General Information | ||||||
Basis of Presentation: Paragon Shipping Inc. (“Paragon”) is a public company incorporated in the Republic of the Marshall Islands on April 26, 2006 and is engaged in the ocean transportation of drybulk cargoes worldwide through the ownership and operation of drybulk carriers. In December 2006, Paragon established a branch in Greece under the provision of Law 89 of 1967, as amended. | |||||||
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of Paragon Shipping Inc. and its wholly-owned subsidiaries (collectively the “Company”) as discussed below, as of December 31, 2013 and 2014 and for the years ended December 31, 2012, 2013 and 2014. | |||||||
Drybulk Vessel Owning Subsidiaries: | |||||||
Vessel Owning Company | Date of | Country of | Vessel’s Name | Delivery Date | Built | DWT | |
Incorporation | Incorporation | ||||||
Trade Force Shipping S.A. | 15-Nov-06 | Marshall Islands | Deep Seas | Dec-06 | 1999 | 72,891 | |
Frontline Marine Company | 15-Nov-06 | Marshall Islands | Calm Seas | Dec-06 | 1999 | 74,047 | |
Fairplay Maritime Ltd. | 15-Nov-06 | Marshall Islands | Kind Seas | Dec-06 | 1999 | 72,493 | |
Donna Marine | 4-Jul-07 | Marshall Islands | Pearl Seas | Aug-07 | 2006 | 74,483 | |
Co. | |||||||
Protea International Inc. | 17-Jul-07 | Liberia | Sapphire Seas | Aug-07 | 2005 | 53,702 | |
Reading Navigation Co. | 17-Jul-07 | Liberia | Diamond Seas | Sep-07 | 2001 | 74,274 | |
Imperator I Maritime Company | 27-Sep-07 | Marshall Islands | Coral Seas | Nov-07 | 2006 | 74,477 | |
Canyon I Navigation Corp. | 27-Sep-07 | Marshall Islands | Golden Seas | Dec-07 | 2006 | 74,475 | |
Paloma Marine | 19-Jun-08 | Liberia | Friendly Seas | Aug-08 | 2008 | 58,779 | |
S.A. | |||||||
Eris Shipping | 8-Apr-10 | Liberia | Dream Seas | Jul-10 | 2009 | 75,151 | |
S.A. | |||||||
Coral Ventures | 5-Aug-09 | Liberia | Prosperous Seas | May-12 | 2012 | 37,293 | |
Inc. | |||||||
Winselet Shipping And Trading Co. Ltd. | 6-Apr-10 | Liberia | Precious Seas | Jun-12 | 2012 | 37,205 | |
Aminta International S.A. | 5-May-10 | Liberia | Priceless | Jan-13 | 2013 | 37,202 | |
Seas | |||||||
Adonia Enterprises S.A. | 5-May-10 | Liberia | Proud | Jan-14 | 2014 | 37,227 | |
Seas (1) | |||||||
Alcyone International Marine Inc. | 17-Jun-13 | Liberia | Gentle Seas (1) | Oct-14 | 2014 | 63,350 | |
Neptune International Shipping & Trading S.A. | 17-Jun-13 | Liberia | Peaceful | Oct-14 | 2014 | 63,331 | |
Seas (1) | |||||||
(1) Refer to Notes 5 and 9 | |||||||
Vessel Under Construction Owning Subsidiaries: | |||||||
Vessel Owning Company | Date of | Country of | Hull Number | Type | Expected Delivery | DWT | |
Incorporation | Incorporation | ||||||
Amphitrite Shipping Inc. | 17-Jun-13 | Liberia | DY4050 (1) | Drybulk Carrier | 2015 | 63,500 | |
Mirabel International Maritime Co. | 17-Jun-13 | Liberia | DY4052 (1) | Drybulk Carrier | 2015 | 63,500 | |
Dolphin Sunrise Limited | 25-Feb-14 | Marshall Islands | YZJ1144 (1) | Drybulk Carrier | 2015 | 81,800 | |
Nautilus Investment Limited | 25-Feb-14 | Marshall Islands | YZJ1145 (1) | Drybulk Carrier | 2015 | 81,800 | |
Oceanus Investments Limited | 25-Feb-14 | Marshall Islands | YZJ1142 (1) | Drybulk Carrier | 2015 | 81,800 | |
(1) Refer to Note 5 | |||||||
Non-Vessel Owning Subsidiaries: | |||||||
Non-Vessel Owning Company | Date of Incorporation | Country of Incorporation | |||||
Camelia Navigation S.A. | 15-Nov-06 | Marshall Islands | |||||
Explorer Shipholding Limited | 15-Nov-06 | Marshall Islands | |||||
Epic Investments Inc. | 21-Dec-06 | Marshall Islands | |||||
Opera Navigation Co. (1) | 21-Dec-06 | Marshall Islands | |||||
Ovation Services Inc. (1) | 16-Sep-09 | Marshall Islands | |||||
Irises Shipping Ltd. (1) | 6-Oct-09 | Marshall Islands | |||||
Letitia Shipping Limited (1) | 4-May-10 | Marshall Islands | |||||
Nereus Navigation Ltd. (1) | 4-May-10 | Marshall Islands | |||||
Ardelia Navigation Limited (1) | 15-Jun-10 | Liberia | |||||
Eridanus Trading Co. (1) | 1-Jul-10 | Liberia | |||||
Delfis Shipping Company S.A. (1) | 7-Feb-11 | Liberia | |||||
(1) In March and April 2015, the Company proceeded with the dissolution of the respective subsidiaries since they were no longer active | |||||||
The Company outsources the technical and commercial management of its vessels to Allseas Marine S.A. (“Allseas”) and Seacommercial Shipping Services S.A. (“Seacommercial”), both related parties wholly owned by Mr. Michael Bodouroglou, the Company’s Chairman, President, Chief Executive Officer and Interim Chief Financial Officer (refer to Note 4). | |||||||
As of December 31, 2014, Mr. Michael Bodouroglou beneficially owned 28.4% of the Company’s common stock. | |||||||
Major Charterers: The following charterers individually accounted for more than 10% of the Company’s charter revenue for the years ended December 31, 2012, 2013 and 2014: | |||||||
Charterer | Percentage of charter revenue | ||||||
2012 | 2013 | 2014 | |||||
Intermare Transport GmbH | 24.10% | 13.40% | - | ||||
Morgan Stanley Capital Group Inc. | 15.70% | - | - | ||||
Mansel Ltd. | 16.60% | - | - | ||||
Cargill International S.A. | 19.20% | 33.60% | 11.60% | ||||
Total | 75.60% | 47.00% | 11.60% | ||||
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2014 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | 2.Significant Accounting Policies |
(a) Principles of Consolidation: The consolidated financial statements incorporate the financial statements of the Company. Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statements of comprehensive income / (loss) from the effective date of acquisition and up to the effective date of disposal, as appropriate. All intercompany balances and transactions have been eliminated. Paragon, as the holding company, determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a variable interest entity. Under ASC 810 “Consolidation” a voting interest entity is an entity in which the total equity investment at risk is sufficient to enable the entity to finance itself independently and provides the equity holders with the obligation to absorb losses, the right to receive residual returns and the right to make financial and operating decisions. The holding company consolidates voting interest entities in which it owns all, or at least a majority (generally, greater than 50%) of the voting interest. Variable interest entities (“VIE”) are entities as defined under ASC 810 that in general either do not have equity investors with voting rights or that have equity investors that do not provide sufficient financial resources for the entity to support its activities. The determination of whether a reporting entity is required to consolidate another entity is based on, among other things, the other entity’s design and purpose and the reporting entity’s power, through voting or similar rights, to direct the activities of the other entity that most significantly impact the other entity’s economic performance. A controlling financial interest in a VIE is present when a company has the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE, or both. Only one reporting entity, known as the primary beneficiary, is expected to be identified as having a controlling financial interest and thus is required to consolidate the VIE. The Company evaluates all arrangements that may include a variable interest in an entity to determine if it may be the primary beneficiary, and would be required to include assets, liabilities and operations of a VIE in its consolidated financial statements. As of December 31, 2013 and 2014, no such interest existed. | |
(b) Use of Estimates: The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |
(c) Other Comprehensive Income / (Loss): The Company follows the accounting guidance relating to “Comprehensive Income,” which requires separate presentation of certain transactions that are recorded directly as components of stockholders’ equity. The Company has elected to present net income / (loss) and other comprehensive income / (loss) in a single continuous statement of comprehensive income / (loss) in its consolidated financial statements. | |
(d) Foreign Currency Translation: The functional currency of the Company is the U.S. Dollar. For other than derivative instruments, each asset, liability, revenue, expense, gain or loss arising from a foreign currency transaction is measured and recorded in the functional currency using the exchange rate in effect at the date of the transaction. As of balance sheet date, monetary assets and liabilities that are denominated in a currency other than the functional currency are adjusted to reflect the exchange rate prevailing at the balance sheet date and any gains or losses are included in the statements of comprehensive income / (loss). As of December 31, 2013 and 2014, the Company had no foreign currency derivative instruments. | |
(e) Cash and Cash Equivalents: The Company considers highly liquid investments such as time deposits and certificates of deposit with an original maturity of three months or less to be cash equivalents. | |
(f) Restricted Cash: Restricted cash represents pledged cash deposits or minimum liquidity required to be maintained under the Company’s borrowing arrangements or in relation to bank guarantees issued on behalf of the Company. In the event that the obligation to maintain such deposits is expected to be terminated within the next twelve months, or relates to general minimum liquidity requirements with no obligation to retain such funds in retention accounts, these deposits are classified as current assets. Otherwise they are classified as non-current assets. | |
(g) Trade Receivables (net): Trade receivables (net), reflect the receivables from charters, net of an allowance for doubtful accounts. At each balance sheet date, all potentially uncollectible accounts are assessed individually for purposes of determining the appropriate provision for doubtful accounts. Allowance for doubtful accounts as of December 31, 2013 and 2014 was $265,751 and $409,226, respectively. | |
(h) Insurance Claims: The Company records insurance claim recoveries for insured losses incurred on damages to fixed assets and for insured crew medical expenses under Other receivables. Insurance claims are recorded, net of any deductible amounts, at the time the Company’s fixed assets suffer insured damages or when crew medical expenses are incurred, recovery is probable under the related insurance policies and the Company can make an estimate of the amount to be reimbursed following submission of the insurance claim. | |
(i) Inventories: Inventories consist of lubricants and stores on board the vessels. When vessels are unemployed or are operating under voyage charters, bunkers on board are also recorded in inventories. Inventories are stated at the lower of cost or market. Cost is determined by the first in, first out method. | |
(j) Vessel Cost: Vessels are stated at cost, which consists of the contract price, less discounts, plus any direct expenses incurred upon acquisition, including improvements, commission paid, delivery expenses and other expenditures to prepare the vessel for her initial voyage. Financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels’ cost. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Repairs and maintenance are expensed as incurred. | |
(k) Impairment of Long-Lived Assets: The Company reviews its long-lived assets “held and used” for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. When the estimate of future undiscounted cash flows, excluding interest charges, expected to be generated by the use of the asset is less than its carrying amount, the Company evaluates the asset for an impairment loss. The Company measures an impairment loss as the difference between the carrying value of the asset and its fair value. In this respect, management regularly reviews the carrying amount of the vessels in connection with the estimated recoverable amount for each of the Company’s vessels. | |
The undiscounted projected net operating cash flows for each vessel are determined by considering the contracted charter revenues from existing charters for the fixed vessel days and an estimated daily time charter equivalent for the unfixed days (based on the most recent ten year historical average of similar size vessels) over the remaining estimated life of the vessel, assumed to be 25 years from the date of initial delivery from the shipyard, net of brokerage commissions, the salvage value of each vessel, which is estimated to be $300 per lightweight ton, expected outflows for vessels’ future dry-docking expenses and estimated vessel operating expenses, assuming an average annual inflation rate where applicable. The Company uses the historical ten-year average as it is considered a reasonable estimation of expected future charter rates over the remaining useful life of the Company’s vessels since it represents a full shipping cycle that captures the highs and lows of the market. The Company utilizes the standard deviation in order to eliminate the outliers of the sample before computing the historic ten-year average of the one-year time charter rate. | |
(l) Vessel Depreciation: Depreciation is computed using the straight-line method over the estimated useful life of the vessels, after considering the estimated salvage value. Each vessel's salvage value is equal to the product of its lightweight tonnage and estimated scrap rate, which up until September 30, 2012, was estimated to be $150 per lightweight ton. In order to align the scrap rate estimates with the historical average scrap rate, effective from October 1, 2012, the Company adjusted the estimated scrap rate used to calculate the vessels’ salvage value from $150 to $300 per lightweight ton. The impact of the increase in the estimated scrap rate is a decrease in depreciation expense going forward. | |
Management estimates the useful life of the Company’s vessels to be 25 years from the date of initial delivery from the shipyard, including secondhand vessels. Secondhand vessels are depreciated from the date of their acquisition through their remaining estimated useful life. | |
(m) Other Fixed Assets: Other fixed assets consist of computer systems installed on board the vessels to improve their efficiency, software and a vehicle. Other fixed assets are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the useful life of the assets, which is estimated to be 5 years for the computer systems software, and 6 years for the Company’s vehicle. Depreciation charged in the years ended December 31, 2012, 2013 and 2014 amounted to $135,095, $164,527 and $203,357, respectively. | |
(n) Investments in Affiliate: Investments in the common stock of entities, in which the Company has significant influence over operating and financial policies, are accounted for using the equity method. Under this method, the investment in the affiliate is initially recorded at cost and is adjusted to recognize the Company’s share of the earnings or losses of the investee after the acquisition date and is adjusted for impairment whenever facts and circumstances indicate that a decline in fair value below the cost basis is other than temporary. The amount of the adjustment is included in the determination of net income / (loss). Differences between the carrying amount of the investment in affiliate and the amount of the Company’s underlying equity in the net assets of the affiliate is amortized over the remaining life of the affiliate’s tangible and intangible assets, and is included in Equity in net income / (loss) of affiliate in the consolidated statements of comprehensive income / (loss). Dividends received from an affiliate reduce the carrying amount of the investment. When the Company’s share of losses in an affiliate equals or exceeds its interest in the affiliate, the Company does not recognize further losses, unless the Company has incurred obligations or made payments on behalf of the affiliate. | |
(o) Dry-docking and Special Survey Costs: Dry-docking and special survey costs are expensed in the period incurred. | |
(p) Financing Costs: Financing fees incurred for obtaining new loans and credit facilities are deferred and amortized to interest expense over the respective loan or credit facility using the effective interest rate method. Any unamortized balance of costs relating to loans repaid or refinanced is expensed in the period the repayment or refinancing is made, subject to the accounting guidance regarding debt extinguishment. Any unamortized balance of costs related to credit facilities repaid is expensed in the period. Any unamortized balance of costs relating to credit facilities refinanced are deferred and amortized over the term of the respective credit facility in the period the refinancing occurs, subject to the provisions of the accounting guidance relating to Debt – Modifications and Extinguishments. The unamortized financing costs are reflected in Other assets in the accompanying balance sheets. | |
(q) Debt restructurings: The Company accounts for debt modifications or restructuring as troubled debt restructuring when a lender for economic or legal reasons related to the Company’s financial situation grants a concession that it would not otherwise consider. These concessions may include a reduction in the interest rate, principal or accrued interest, extension of the maturity date or other actions intended to minimize potential losses. The Company considers a lender to have granted a concession if the Company’s effective interest rate on the restructured debt is less than the effective interest rate of the old debt immediately before the restructuring. The Company considers the total future cash flows (defined as principal plus interest) of the restructured debt in comparison with the carrying value of the original debt. If a debt modification or restructuring is determined to be a troubled debt restructuring, the Company reduces the carrying amount of the debt when the debt balance is greater than the total future cash flows under the new terms, in which case a gain is recognized. When the total future cash flows of the restructured debt are greater than the carrying value at the date of amendment, the carrying value of the original debt is not adjusted. In a troubled debt restructuring in which the Company agrees to transfer assets to fully settle the debt, the Company recognizes a gain on restructuring for the difference between the carrying amount of the debt and the more clearly evident of: (a) the fair value of the transferred assets or (b) the fair value of the settled debt. | |
(r) Pension and Retirement Benefit Obligations—Crew: The vessel owning companies employ the crew on board under short-term contracts (usually up to nine months) and, accordingly, they are not liable for any pension or post-retirement benefits. | |
(s) Revenue and Expenses: | |
Revenue is recognized when a charter agreement exists, the vessel is made available to the charterer and collection of the related revenue is reasonably assured. | |
Time Charter Revenue: Time charter revenues are recorded ratably over the term of the charter as service is provided, including the amortization / accretion of the above / below market acquired time charters, where applicable. When two or more time charter rates are involved during the life term of a charter agreement, the Company recognizes revenue on a straight-line basis, and income accrued or deferred as a result is included in Other receivables or Deferred income, respectively. Time charter revenues received in advance of the provision of charter service are recorded as deferred income, and recognized when the charter service is rendered. | |
Revenue / Voyage charters: Voyage charter is a charter where a contract is made in the spot market for the use of a vessel for a specific voyage for a specified freight rate per ton. If a charter agreement exists and collection of the related revenue is reasonably assured, revenue is recognized as it is earned ratably during the duration of the period of each voyage. A voyage is deemed to commence upon the latest between the completion of discharge of the vessel’s previous cargo and the charter party date of the current voyage, and is deemed to end upon the completion of discharge of the current cargo. Demurrage income represents payments by a charterer to a vessel owner when loading or discharging time exceeds the stipulated time in the voyage charter and is recognized as it is earned. | |
Commissions: Charter hire commissions are deferred and amortized over the related charter period and are presented separately in the accompanying consolidated statements of comprehensive loss. | |
Voyage Expenses: Voyage expenses exclude commissions and consist of all costs that are unique to a particular voyage, primarily including port expenses, canal dues, war risk insurances and fuel costs. Voyage expenses also include losses from the sale of bunkers to charterers and bunkers consumed during off-hire periods and while traveling to and from dry-docking. | |
Vessel Operating Expenses: Vessel operating expenses are accounted for as incurred on the accrual basis. Vessel operating expenses include crew wages and related costs, the cost of insurance, expenses relating to repairs and maintenance, the cost of spares and consumable stores, and other miscellaneous expenses. | |
(t) Share based Compensation: Share based payments to employees and directors, including grants of employee and directors stock options, are recognized in the statements of comprehensive income / (loss) based on their grant date fair values and amortized over the required service period. | |
(u) Segment Reporting: The Company reports financial information and evaluates its operations by charter revenues and not by the length of ship employment for its customers (i.e., spot vs. time charters) or by geographical region as the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographical information is impracticable. The Company does not have discrete financial information to evaluate the operating results for each type of charter. Although revenue can be identified for these types of charters, management cannot and does not identify expenses, profitability or other financial information for these charters. As a result, management, including the Chief Executive Officer being the chief operating decision maker, reviews operating results solely by revenue per day and operating results of the fleet, and thus the Company has determined that it operates under one reportable segment. | |
(v) Derivatives: The Company enters into interest rate swap agreements to manage its exposure to fluctuations of interest rate risk associated with its borrowings. All derivatives are recognized in the consolidated financial statements at their fair value. The fair value of the interest rate derivatives is based on a discounted cash flow analysis. When such derivatives do not qualify for hedge accounting, the Company recognizes their fair value changes in current period earnings. When the derivatives qualify for hedge accounting, the Company recognizes the effective portion of the gain or loss on the hedging instrument directly in other comprehensive income / (loss), while the ineffective portion, if any, is recognized immediately in current period earnings. The Company, at the inception of the transaction, documents the relationship between the hedged item and the hedging instrument, as well as its risk management objective and the strategy of undertaking various hedging transactions. The Company also assesses at hedge inception of whether the hedging instruments are highly effective in offsetting changes in the cash flows of the hedged items. | |
The Company discontinues cash flow hedge accounting if the hedging instrument expires and it no longer meets the criteria for hedge accounting or designation is revoked by the Company. At that time, any cumulative gain or loss on the hedging instrument recognized in equity is kept in equity until the forecasted transaction occurs. When the forecasted transaction occurs, any cumulative gain or loss on the hedging instrument is recognized in current period earnings. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognized in equity is transferred to current period earnings as financial income or expense. | |
(w) Fair value of financial instruments: The fair value of the interest rate derivatives is based on a discounted cash flow analysis. | |
In accordance with the requirements of accounting guidance relating to Fair Value Measurements, the Company classifies and discloses its assets and liabilities carried at fair value in one of the following three categories: | |
Level 1:Quoted market prices in active markets for identical assets or liabilities | |
Level 2:Observable market based inputs or unobservable inputs that are corroborated by market data | |
Level 3:Unobservable inputs that are not corroborated by market data. | |
(x) Earnings per Share (EPS): The computation of basic earnings per share is based on the weighted average number of common shares outstanding during the period determined using the two-class method of computing earnings per share. Non-vested share awards issued are included in the two-class method and income attributable to non-vested share awards is deducted from the net income reported for purposes of calculating net income available to common shareholders used in the computation of basic earnings per share. The computation of diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised. Such securities include non-vested share awards for which the assumed proceeds upon grant are deemed to be the amount of compensation cost attributable to future services and are not yet recognized and common shares issuable upon exercise of the Company’s outstanding warrants, to the extent that they are dilutive, using the treasury method. | |
(y) Subsequent Events: The Company evaluates subsequent events or transactions up to the date in which the financial statements are issued according to the requirements of ASC 855. | |
(z) Recent Accounting Pronouncements: | |
The Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued a standard that will supersede virtually all of the existing revenue recognition guidance in U.S. GAAP and is effective for annual periods beginning on or after December 15, 2016. The standard establishes a five-step model that will apply to revenue earned from a contract with a customer (with limited exceptions), regardless of the type of revenue transaction or the industry. The standard’s requirements will also apply to the recognition and measurement of gains and losses on the sale of some non-financial assets that are not an output of the entity’s ordinary activities (e.g., sales of property, plant and equipment or intangibles). Extensive disclosures will be required, including disaggregation of total revenue; information about performance obligations; changes in contract asset and liability account balances between periods and key judgments and estimates. Management is in the process of accessing the impact of the new standard on Company’s financial position and performance. | |
In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15 – Presentation of Financial Statements - Going Concern. ASU 2014-15 provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. ASU 2014-15 requires an entity’s management to evaluate at each reporting period based on the relevant conditions and events that are known at the date of financial statements are issued, whether there are conditions or events, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued and to disclose the necessary information. ASU 2014-15 is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. | |
Going_Concern
Going Concern | 12 Months Ended |
Dec. 31, 2014 | |
Going Concern [Abstract] | |
Going Concern | 3. Going Concern |
As of December 31, 2014, the Company was in compliance with the financial and security ratio covenants contained in its debt agreements, with the exception of the security cover ratio covenant contained in the facility with Commerzbank AG. The respective breach was subsequently cured as in April 2015, the Company agreed with Commerzbank AG to waive the application of the security cover ratio covenant contained in the facility effective from December 31, 2014 until December 31, 2015 as discussed in Note 9. | |
Given the current drybulk charter rates, it is probable that the Company will not be in compliance with the minimum working capital requirement and the minimum liquidity requirement contained in certain of its loan and credit facilities on the applicable measurement dates in 2015. Furthermore, based on the Company’s cash flow projections for 2015, cash on hand and cash provided by operating activities will not be sufficient to cover scheduled debt repayments due in 2015. | |
The Company is currently in negotiations with such lenders to obtain waivers for the affected covenants. The Company is also exploring several alternatives aiming to manage its working capital requirements and other commitments if current drybulk charter rates remain at today’s low levels including negotiations for the restructuring of its loans. As management believes that the negotiations will be successful, the accompanying consolidated financial statements were prepared assuming that the Company will continue as a going concern. Therefore, the accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and liabilities, or any other adjustments that might result in the event the Company is unable to continue as a going concern. |
Transactions_with_Related_Part
Transactions with Related Parties | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Transactions with Related Parties [Abstract] | ||||
Transactions with Related Parties | 4.Transactions with Related Parties | |||
(a)Allseas: The following amounts charged by Allseas are included in the accompanying consolidated statements of comprehensive loss: | ||||
2012 | 2013 | 2014 | ||
Included in Commissions | ||||
(1(i)) Charter hire commissions | $646,987 | $750,533 | $708,153 | |
Netted against Gain from sale of assets | ||||
(1(ii)) Vessel sale & purchase commissions | $- | $- | $745,000 | |
Included in Vessel operating expenses | ||||
(1(v)) Superintendent fees | $338,826 | $399,626 | $481,200 | |
Included in Dry-docking expenses | ||||
(1(v)) Superintendent fees | $- | $109,248 | $123,840 | |
Management fees - related party | ||||
(1(iii)) Management fees | $3,428,548 | $4,104,271 | $4,628,813 | |
(2) Financial accounting and reporting services | 666,196 | 720,361 | $757,442 | |
(3) Loretto agreement | - | 1,049,784 | $880,015 | |
Total Management fees | $4,094,744 | $5,874,416 | $6,266,270 | |
Included in General and administrative expenses | ||||
(4) Administrative fees | $36,085 | $38,598 | $37,746 | |
(7) Executive services agreement | $3,228,438 | $7,582,634 | $5,689,152 | |
The following amounts charged by Allseas are capitalized and are included in vessels cost and advances for vessels under construction in the accompanying consolidated balance sheets: technical management and superintendent fees relating to newbuilding vessels (refer to 5–Newbuilding Supervision Agreement), and vessel purchase commissions (refer to 1(ii)–Vessel Commissions), which in the aggregate amounted to $1,588,512 and $3,804,918 for the years ended December 31, 2013 and 2014, respectively. | ||||
Following the cancellation of the newbuilding contract relating to Hull no. 656 as discussed in Note 5, for the year ended December 31, 2013, the Company recorded a loss from contract cancellation of $568,658 relating to capitalized expenses for Hull no. 656, which includes technical management and superintendent fees (refer to 5–Newbuilding Supervision Agreement) charged by Allseas that in the aggregate amounted to $444,421. | ||||
(1) Ship-Owning Company Management Agreements | ||||
(i) Charter Hire Commissions - The Company paid Allseas 1.25% of the gross freight, demurrage and charter hire collected from the employment of the vessels (“Charter Hire Commission”), which are presented separately in the accompanying consolidated statements of comprehensive loss. | ||||
(ii) Vessel Commissions - The Company also paid Allseas a fee equal to 1.00% of the purchase price of any vessel bought, constructed or sold on behalf of the Company, calculated in accordance with the relevant memorandum of agreement, (“Vessel Commission”). Vessel commissions relating to vessel sale is included in the determination of the gain / loss on sale of assets presented in the accompanying consolidated statements of comprehensive loss. Vessel commissions relating to vessels bought or constructed are capitalized and included in vessels cost and advances for vessels under construction in the accompanying consolidated balance sheets. | ||||
(iii) Management Services - Each of the ship-owning companies has a management agreement with Allseas, under which management services are provided in exchange for a fixed daily fee per vessel. This fee is subject to adjustment on June 1 of each year based on the official Eurozone inflation rate. For the period from January 1, 2012 to May 31, 2012, the Company paid Allseas a management fee of €636.74 per vessel per day, while effective June 1, 2012, Allseas management fee was adjusted to €652.02 per vessel per day. Effective June 1, 2013, Allseas management fee was adjusted to €661.15 per vessel per day, while effective June 1, 2014, Allseas management fee was adjusted to €664.46 per vessel per day. | ||||
(iv) Pre-Delivery Services – A lump sum fee of $15,000 is payable to Allseas for pre-delivery services provided during the period from the date of the Memorandum of Agreement for the purchase of the vessel, until the date of delivery. | ||||
(v) Superintendent Services – Allseas is entitled to a superintendent fee of €500 per day for each day in excess of 5 days per calendar year for which a Superintendent performed on site inspection. | ||||
In January 2015, the Company’s vessel owning subsidiaries signed amended and restated management agreements with Allseas, according to which a portion of the services that were previously provided by Allseas have been ceased. Pursuant to the terms of the amended and restated management agreements, effective January 2, 2015, Allseas is no longer providing chartering and sale and purchase services, and as such the fees related to these services have been terminated. | ||||
(2) Accounting Agreement – Allseas is entitled to a fee of €250,000 per annum, payable quarterly, for the provision of financial accounting services, and a fee of $30,000 per vessel per annum, payable quarterly, for the provision of financial reporting services. These fees are included in Management fees - related party in the accompanying consolidated statements of comprehensive loss. For the years ended December 31, 2012, 2013 and 2014, an amount of $666,196, $720,361 and $757,442 respectively, was paid to Allseas for financial accounting and reporting services. In February 2015, the Company agreed to renew the term of the agreement for one additional year, effective January 1, 2015. | ||||
(3) Tripartite Agreement between the Company, Allseas and Loretto Finance Inc. - On November 10, 2009, the Company, Allseas, and Loretto Finance Inc. (“Loretto”), a wholly owned subsidiary of Allseas, signed a tripartite agreement, as clarified and amended by a supplemental agreement, effective from December 1, 2012, whereby in the event of a capital increase, an equity offering or the issuance of common shares to a third party or third parties in the future, other than common shares issued pursuant to the Company’s equity incentive plan as discussed in Note 13 (as the same may be further amended, amended and restated, supplemented or otherwise modified) or any future equity incentive plans may be adopted, the Company will issue, at no cost to Loretto, additional common shares in an amount equal to 2% of the total number of common shares issued pursuant to such capital increase, equity offering or third party issuance, as applicable. In accordance with the terms of the agreement, any common shares to be issued to Loretto under the agreement may only be issued once the capital increase, equity offering or third party issuance giving rise to the obligation to issue shares to Loretto under the agreement has closed and any applicable contingencies, forfeiture rights or conditions precedent relating to such capital increase, equity offering or third party issuance have lapsed or expired or have been cancelled or terminated, unless otherwise agreed by the mutual agreement of the parties. The fair value of the shares issued for no consideration are accounted as share based payment and presented as Management fees - related party in the year granted in the statement of comprehensive income / (loss). Accordingly, as of December 31, 2014, the Company has granted and issued to Loretto a total of 469,958 Class A common shares, of which 135,700 were issued in 2014. | ||||
In connection with the public offering that was completed in February 2014 (refer to Note 12), effective February 18, 2014, 135,700 Class A common shares, representing the 2% of the 6,785,000 Class A common shares sold in the public offering, were granted to Loretto. The fair value of such shares based on the average of the high-low trading price of the shares on February 18, 2014, was $880,015, which was recorded as share based compensation and is included in Management fees – related party in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. | ||||
(4) Administrative Service Agreement - The Company entered into an administrative service agreement with Allseas on November 12, 2008. Under the agreement, Allseas provides telecommunication services, secretarial and reception personnel and equipment, security facilities, office cleaning services and information technology services. The agreement provides that all costs and expenses incurred in connection with the provision of the above services by Allseas to be reimbursed on a quarterly basis. | ||||
(5) Newbuildings Supervision Agreement - The Company has entered into management agreements with Allseas relating to the supervision of each of the contracted newbuilding vessels, pursuant to which Allseas is entitled to: (1) a flat fee of $375,000 per vessel for the first 12 month period commencing from the respective steel cutting date of each vessel, and thereafter the flat fee will be paid on a pro rata basis until the vessel’s delivery to the Company, (2) a daily fee of €115 per vessel commencing from the date of the vessel's shipbuilding contract until the Company accepts delivery of the respective vessel, and (3) €500 per day for each day in excess of 5 days per calendar year for which a superintendent performed on site inspection. | ||||
(6) Compensation Agreement – The Company has entered into a compensation agreement with Allseas whereby in the event that Allseas is involuntarily terminated as the manager of its fleet, it shall compensate Allseas with an amount equal to the sum of (i) three years of the most recent management fees and commissions, based on the fleet at the time of termination, and (ii) €3,000,000 (or $3,642,000 based on the Euro/U.S. dollar exchange rate of €1.0000:$1.2140 as of December 31, 2014). | ||||
(7) Executive Services Agreement – Effective January 1, 2011, the Company entered into an executive services agreement with Allseas, pursuant to which Allseas provides the services of the executive officers, which include strategy, business development, marketing, finance and other services, who report directly to the Company’s Board of Directors. Under the agreement, prior to January 1, 2013, Allseas was entitled to an executive services fee of €2,500,000 per annum, payable in equal monthly installments, plus incentive compensation. Effective January 1, 2013, the executive services fee was adjusted to €2,700,000 per annum, while effective January 1, 2014, the executive services fee was adjusted to €2,900,000 per annum. The agreement has an initial term of five years and automatically renews for a successive five-year term unless sooner terminated. On March 6, 2013, the Company amended the terms of the termination clause of the executive services agreement, whereby, if the respective agreement is terminated by Allseas either for “good reason” or as a result of “change of control”, as such terms are defined in the agreement, or terminated by the Company without “cause”, as defined in the agreement, Allseas will be entitled to receive (i) the amount of the executive services fee payable through the “termination date,” as defined in the agreement; (ii) compensation equal to three years’ annual executive services fee then applicable; and (iii) an amount of the Company’s common shares equal to 5% of the then issued and outstanding shares of the Company. For the year ended December 31, 2012, an amount of $3,228,438 was paid to Allseas for the services of the executive officers, while no incentive compensation was remitted. For the year ended December 31, 2013, an amount of $7,582,634 was paid to Allseas for the services of the executive officers, which includes incentive compensation of $3,993,000. For the year ended December 31, 2014, an amount of $5,689,152 was paid to Allseas for the services of the executive officers, which includes incentive compensation of $1,848,900. | ||||
Each month, the Company funds a payment to Allseas to cover working capital equal to one month’s worth of estimated operating expenses. At each balance sheet date, the excess of the amount funded to Allseas over payments made by Allseas for operating expenses is reflected as Due from related parties. As of December 31, 2013 and 2014, the amount due from Allseas was $146,051 and $843,510, respectively. | ||||
(b)Seacommercial: In January 2015, the Company’s vessel owning subsidiaries signed brokerage services agreements with Seacommercial. Pursuant to the agreements, effective January 2, 2015, Seacommercial provides full brokerage services in exchange for fees representing the 1.25% Charter Hire Commission and the 1.00% Vessel Commission. | ||||
(c)Granitis Glyfada Real Estate Ltd. ("Granitis") - Leasing: On September 13, 2007 and effective as of October 1, 2007, the Company entered into a rental agreement to lease office space in Athens, Greece, with Granitis, a company beneficially owned by the Company’s Chairman, President, Chief Executive Officer and Interim Chief Financial Officer. The term of the lease was for 5 years beginning October 1, 2007 and expired on September 30, 2012. The monthly rental for the first year was €2,000, plus 3.6% tax, and thereafter would be adjusted annually for inflation increases in accordance with the official Greek inflation rate. On October 1, 2012, the rental agreement was renewed for an additional term of 5 years, beginning October 1, 2012 and expiring September 30, 2017, pursuant to which the monthly rental for the first year is €3,000, plus 3.6% tax, and thereafter will be adjusted annually for inflation increases in accordance with the official Greek inflation rate. Rent expense under this lease amounted to $39,593, $49,324 and $49,001 for the years ended December 31, 2012, 2013 and 2014, respectively, and is included in General and administrative expenses in the accompanying consolidated statements of comprehensive loss. | ||||
(d)Crewcare Inc. (“Crewcare”): | ||||
(1) Manning Agency Agreements – Each of the Company’s ship-owning subsidiaries has a manning agency agreement with Crewcare, a company beneficially owned by the Company’s Chief Executive Officer, based in Manila, Philippines. Under the agreements, manning services are provided in exchange for a fixed monthly fee of $95 per seaman for all officers and crew who serve on board each vessel, plus a recruitment fee of $120 per seaman, payable on a one-off basis. In addition, the agreements also provide for a fee of $30 per seaman for in-house training, and a fee of $50 per seaman for extra in-house training. The expenses incurred amounted to $321,648, $382,517 and $441,499 for the years ended December 31, 2012, 2013 and 2014, respectively, and are included in Vessels operating expenses. Administrative services are also being provided which represent payment of crew wages and related costs on behalf of the Company. | ||||
(2) Cadetship Program Agreements – On October 5, 2013, each of the Company’s ship-owning subsidiaries entered into a cadetship program agreement with Crewcare, pursuant to which Crewcare, at its own cost, is responsible for recruiting and training cadets to be assigned to the vessels. These services are being provided in exchange for a lump sum fee of $5,000 per cadet employed on board the vessel for one-year on board training. The agreement has an initial term of one year with the option to renew for one more year by mutual agreement. The agreement was renewed for one additional year, effective October 5, 2014. The expenses incurred for the years ended December 31, 2013 and 2014, amounted to $15,000 and $360,000, respectively, and are included in Vessels operating expenses. | ||||
The balances due to Crewcare amounted to $82,074 and $166,354 as of December 31, 2013 and 2014, respectively. | ||||
(e)Box Ships Inc.: As of December 31, 2013 and 2014, the Company held 13.6% and 11.0% of Box Ships’ common stock, respectively. The decrease in the percentage of Box Ships’ common stock held by the Company is mainly due to the Company’s non-participation in the public offering of 5,500,000 common shares of Box Ships, which was completed on April 15, 2014 (refer to Note 8). | ||||
On May 27, 2011, the Company granted Box Ships an unsecured loan of $30,000,000. The loan was initially payable in one installment on the second anniversary of the Box Ships IPO on April 19, 2013. The loan bore interest at LIBOR plus a margin of 4.00%. As of December 31, 2012, the outstanding loan balance due from Box Ships was $14,000,000. On February 28, 2013, Box Ships prepaid an amount of $1,000,000 and reduced the outstanding balance of the respective loan to $13,000,000. In addition, on March 11, 2013, the Company agreed to amend certain terms of the loan agreement. Pursuant to the amended agreement, the Company agreed to extend the maturity of the loan for one year, from April 19, 2013 to April 19, 2014. During the remaining term of the loan, Box Ships was required to make quarterly principal installments in the amount of $1,000,000 each, with a final balloon payment of $9,000,000 due on the maturity date. In consideration for the amendment of the loan agreement, Box Ships agreed to pay an amendment fee of $65,000, which is included in Interest income in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2013, and to increase the margin from 4.00% to 5.00%. In April 2013, Box Ships paid the amendment fee of $65,000. Pursuant to the amended loan agreement, on April 19, 2013 and on July 19, 2013, Box Ships proceeded with the first two quarterly principal installment payments of $1,000,000 each. In addition, on August 5, 2013, Box Ships prepaid an amount of $5,000,000 and reduced the outstanding balance of the respective loan to $6,000,000, which was fully repaid on October 18, 2013. For the years ended December 31, 2012, 2013 and 2014, interest charged on the respective loan amounted to $675,856, $439,326 and $0, respectively. | ||||
Advances_for_Vessels_Under_Con
Advances for Vessels Under Construction | 12 Months Ended |
Dec. 31, 2014 | |
Advances for Vessels Under Construction [Abstract] | |
Advances for Vessels Under Construction | 5.Advances for Vessels Under Construction |
Advances for vessels under construction relate to the installments paid that were due to the respective shipyard including capitalized expenses. | |
In December 2013, the Company agreed to acquire, subject to certain closing conditions that were lifted in the first quarter of 2014, shipbuilding contracts for two additional Ultramax newbuilding drybulk carriers from Allseas (Hull numbers DY4050 and DY4052). The Ultramax newbuildings have a carrying capacity of 63,500 dwt each and are currently under construction at Yangzhou Dayang Shipbuilding Co. Ltd., with scheduled delivery in the third quarter of 2015. The acquisition cost of these two newbuildings is $28,250,000 per vessel, or $56,500,000 in the aggregate. In February 2014, the Company paid a first installment of $5,592,661 per vessel. In addition, in February 2014, an amount of $282,500 per vessel was paid to Allseas, representing vessel purchase commissions equal to 1% of the acquisition cost, pursuant to the newbuilding supervision agreements between the respective ship-owning companies and Allseas. Upon commencement of the steel cutting of each vessel in the second quarter of 2014, the Company paid a second installment of $3,884,530 per vessel. The balance of the contract price, or $18,772,809 per vessel, will be payable upon the delivery of each vessel. | |
In December 2013, the Company also entered into an agreement with Zhejiang Ouhua Shipbuilding, to cancel one of its two 4,800 TEU containership newbuilding contracts (Hull no. 656) at no cost to the Company, to transfer the deposit to the remaining containership (C/V Box King) and to reduce its contract price from the original $57,500,000 to $55,000,000. | |
As of December 31, 2013, the Company’s newbuilding program consisted of one Handysize drybulk carrier (Hull no. 625), two Ultramax drybulk carriers (Hull numbers DY152 and DY153) and one 4,800 TEU containership (C/V Box King) with expected deliveries in 2014, as well as two Ultramax drybulk carriers (Hull numbers DY4050 and DY4052) with expected deliveries in 2015. | |
On January 7, 2014, the Company took delivery of its fourth Handysize drybulk carrier; the M/V Proud Seas (Hull no. 625). In January 2014, an amount of $21,637,078 was paid to the shipyard representing the final installment of the respective vessel, which was financed from the syndicated secured loan facility led by Nordea Bank Finland Plc dated May 5, 2011 (refer to Note 9). | |
In March 2014, the Company entered into contracts with Jiangsu Yangzijiang Shipbuilding Co. for the construction of three Kamsarmax newbuilding drybulk carriers (Hull numbers YZJ1144, YZJ1145 and YZJ1142). The Kamsarmax newbuildings have a carrying capacity of 81,800 dwt each, with scheduled delivery between the second and fourth quarter of 2015. The acquisition cost of these three newbuildings is $30,550,000 per vessel, or $91,650,000 in the aggregate. In March 2014, the Company paid a first installment of $9,165,000 per vessel. In addition, in March 2014, an amount of $305,500 per vessel was paid to Allseas, representing vessel purchase commission equal to 1% of the acquisition cost, pursuant to the newbuilding supervision agreements between the respective ship-owning companies and Allseas. The balance of the contract price, or $21,385,000 per vessel, will be payable upon the delivery of each vessel. | |
As of March 31, 2014, the Company assessed as probable the potential sale of the remaining containership under construction, the C/V Box King. As a result of the Company’s intention to sell such vessel, an impairment loss of $15,695,282 was recorded in the first quarter of 2014 and is included in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. The impairment loss was based on the Company’s best estimate of the fair value of the vessel on a time charter free basis, and is in line with the sale price of the memorandum of agreement that the Company entered into on April 25, 2014, for the sale of the vessel to an unrelated third party, as discussed below. | |
On April 25, 2014, the Company entered into a memorandum of agreement for the sale of its 4,800 TEU containership newbuilding to an unrelated third party for $42,500,000, less 3% commission. In May 2014, the Company also agreed with the shipyard to reduce the contract price of the respective vessel by $770,000. In addition, the Company mutually agreed with China Development Bank to cancel the corresponding credit facility for the vessel, as discussed in Note 9. | |
The sale of the C/V Box King and its transfer to the new owners was concluded on May 23, 2014, and a gain of $402,805 was incurred. The net proceeds from the sale of the vessel amounted to $9,995,000 and represent the difference between the net sale price of the vessel and the outstanding contractual obligation due to the shipyard upon delivery that was resumed by the vessel’s new owners. | |
In October 2014, the Company took delivery of the two Ultramax drybulk carriers; the M/V Gentle Seas and the M/V Peaceful Seas (Hull numbers DY152 and DY153). In October 2014, an aggregate amount of $35,672,940 was paid to the shipyard representing the final installment of the two vessels, which was mainly financed from the loan facility with HSH Nordbank AG dated April 4, 2014, following a total drawdown of $34,400,000 (refer to Note 9). | |
As of December 31, 2014, the Company’s newbuilding program consisted of two Ultramax drybulk carriers (Hull numbers DY4050 and DY4052) and three Kamsarmax drybulk carriers (Hull numbers YZJ1144, YZJ1145 and YZJ1142) with scheduled delivery between the second and fourth quarter of 2015. |
Vessels_Net
Vessels, Net | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Vessels Net [Abstract] | ||||
Vessels, Net | 6.Vessels, Net | |||
Vessel | Accumulated | Net Book | ||
Cost | Depreciation | Value | ||
Balance January 1, 2013 | $351,611,923 | ($53,235,483) | $298,376,440 | |
Newbuilding deliveries | 24,581,533 | - | 24,581,533 | |
Depreciation for the period | - | -16,822,057 | -16,822,057 | |
Balance December 31, 2013 | $376,193,456 | ($70,057,540) | $306,135,916 | |
Newbuilding deliveries | 81,051,077 | - | 81,051,077 | |
Depreciation for the period | - | -18,154,020 | -18,154,020 | |
Balance December 31, 2014 | $457,244,533 | ($88,211,560) | $369,032,973 | |
All Company’s vessels were first-priority mortgaged as collateral to the loans and credit facilities and related interest rate swaps outstanding as of December 31, 2014. | ||||
On January 29, 2013, the Company took delivery of the Handysize drybulk carrier; the M/V Priceless Seas. | ||||
During 2014, the Company took delivery of the Handysize drybulk carrier; the M/V Proud Seas, and the two Ultramax drybulk carriers; the M/V Gentle Seas and the M/V Peaceful Seas (refer to Notes 5 and 9). |
Other_Assets
Other Assets | 12 Months Ended | |
Dec. 31, 2014 | ||
Other Assets [Abstract] | ||
Other Assets | 7. Other Assets | |
Other assets of $2,303,304 and $4,367,134 as of December 31, 2013 and 2014, respectively, include deferred financing costs of $2,297,121 and $4,360,951, respectively, and utility deposits related to the leased office space of $6,183 at December 31, 2013 and 2014. | ||
The deferred financing costs comprise: | ||
Balance January 1, 2013 | $2,596,029 | |
Additions | 642,825 | |
Amortization | -941,733 | |
Balance December 31, 2013 | $2,297,121 | |
Additions | 4,172,546 | |
Amortization | -2,108,716 | |
Balance December 31, 2014 | $4,360,951 | |
Investment_in_Affiliate
Investment in Affiliate | 12 Months Ended | ||
Dec. 31, 2014 | |||
Investment in Affiliate [Abstract] | |||
Investment in Affiliate | 8.Investment in Affiliate | ||
The following table is a reconciliation of the Company’s investment in affiliate as presented on the accompanying consolidated balance sheets: | |||
Balance January 1, 2013 | $19,987,743 | ||
Equity in net income of affiliate | 1,652,339 | ||
Equity in other comprehensive income of affiliate | 77,165 | ||
Dividends received | -1,787,500 | ||
Dilution effect | -390,821 | ||
Impairment in investment in affiliate | -8,229,551 | ||
Balance December 31, 2013 | $11,309,375 | ||
Equity in net income of affiliate | 471,079 | ||
Equity in other comprehensive income of affiliate | 16,139 | ||
Dilution effect | -221,679 | ||
Impairment in investment in affiliate | -8,618,664 | ||
Balance December 31, 2014 | $2,956,250 | ||
As of December 31, 2013 and 2014, the Company held 3,437,500 shares or 13.6% and 11.0% of Box Ships’ common stock, respectively. The decrease in the percentage of Box Ships’ common stock held by the Company is mainly due to the Company’s non-participation in the public offering of 5,500,000 common shares of Box Ships, which was completed on April 15, 2014. The Company, on the basis of significant influence exercised over Box Ships through its shareholdings and shared executive management, accounted for its investment in Box Ships under the equity method and is separately reflected on Company’s consolidated balance sheets. | |||
The loss on investment in affiliate of $8,620,372 for the year ended December 31, 2013, consists of $390,821, relating to the dilution effect from the Company’s non-participation in the public offering of 4,000,000 common shares of Box Ships, which was completed on March 18, 2013, as well as the aggregate impairment in investment in affiliate of $8,229,551, relating to the difference between the fair value and the book value of the Company’s investment in Box Ships, which the Company considered as other than temporary (refer to Note 11). | |||
The loss on investment in affiliate of $8,840,343, for the year ended December 31, 2014, consists of $221,679, relating to the dilution effect from the Company’s non-participation in the public offering of 5,500,000 common shares of Box Ships, which was completed on April 15, 2014, as well as the aggregate impairment in investment in affiliate of $8,618,664, relating to the difference between the fair value and the book value of the Company’s investment in Box Ships, which the Company considered as other than temporary (refer to Note 11). | |||
Summarized financial information in respect of Box Ships Inc. is set out below: | |||
Year ended December 31, | |||
INCOME STATEMENT DATA | 2013 | 2014 | |
Net revenue | $69,836,201 | $49,864,674 | |
Operating income | 23,631,192 | 1,966,947 | |
Net income | $15,307,658 | $2,623,515 | |
As of December 31, | |||
BALANCE SHEET DATA | 2013 | 2014 | |
Total current assets | $31,691,262 | $22,011,255 | |
Total non-current assets | 397,915,376 | 375,837,950 | |
Total assets | 429,606,638 | 397,849,205 | |
Total current liabilities | 184,434,021 | 140,886,944 | |
Total long-term liabilities | $453,248 | $282,375 | |
LongTerm_Debt
Long-Term Debt | 12 Months Ended | ||
Dec. 31, 2014 | |||
Long-Term Debt [Abstract] | |||
Long-Term Debt | 9.Long-Term Debt | ||
The table below presents a breakdown of the Company’s long-term debt as of December 31, 2013 and 2014: | |||
2013 | 2014 | ||
(a)Commerzbank AG (August 12, 2011) | $47,550,000 | $43,375,000 | |
(b)Unicredit Bank AG (November 19, 2007) | 22,587,000 | 14,606,500 | |
(c)Bank of Scotland Plc (December 4, 2007) | 33,616,864 | - | |
(d)Bank of Ireland (March 30, 2009) | 13,400,000 | 8,350,000 | |
(e-1)HSH Nordbank AG (July 31, 2008) | 20,625,000 | - | |
(e-2)HSH Nordbank AG (April 4, 2014) | - | 46,713,600 | |
(f)HSBC Bank Plc (July 2, 2010) | 16,800,000 | 14,460,000 | |
(g-1)Nordea Bank Finland Plc (May 5, 2011) | 25,536,062 | - | |
(g-2)Nordea Bank Finland Plc (May 6, 2014) | - | 78,273,638 | |
(h)Senior unsecured notes due 2021 | - | 25,000,000 | |
Total | $180,114,926 | $230,778,738 | |
Disclosed as follows in the Consolidated Balance Sheets | |||
Current portion of long-term debt | $17,257,750 | $20,714,324 | |
Long-term debt | 162,857,176 | 210,064,414 | |
Total | $180,114,926 | $230,778,738 | |
As of December 31, 2014, the minimum annual principal payments for the outstanding debt required to be made after the balance sheet date, excluding the subsequent agreements with Commerzbank AG, Unicredit Bank AG and Bank of Ireland discussed below, are as follows: | |||
To December 31, | |||
2015 | $20,714,324 | ||
2016 | 32,226,824 | ||
2017 | 48,317,324 | ||
2018 | 11,642,324 | ||
2019 | 11,642,324 | ||
Thereafter | 106,235,618 | ||
Total | $230,778,738 | ||
(a)Commerzbank AG (August 12, 2011): On April 1, 2015, the Company agreed with Commerzbank AG (“Commerzbank”) to amend certain terms of the facility, including the deferral of a portion of its four scheduled quarterly installments due in 2015, and the waiver of the application of the financial and security cover ratio covenants contained in the facility, effective from December 31, 2014 until December 31, 2015. The Company also agreed to a $3,000,000 partial prepayment, a portion of which was prepaid in the first quarter of 2015, while the balance is payable upon signing the final documentation. | |||
The main terms and conditions of the loan agreement dated August 12, 2011, as subsequently amended, are as follows: | |||
The loan agreement is secured by a first priority mortgage on the vessels: M/V Sapphire Seas, M/V Pearl Seas and M/V Diamond Seas. | |||
The loan bears interest at LIBOR, plus any mandatory costs, plus a margin of (i) 3.00% on the outstanding amount of the loan, less any amounts that are deferred, and (ii) 4.50% on the amounts of the loan that have been deferred. | |||
Excluding the agreement dated April 1, 2015 discussed above, the outstanding loan amount as of December 31, 2014 of $43,375,000 was required to be repaid in 11 consecutive quarterly installments of $1,425,000, plus a balloon repayment of $27,700,000 payable simultaneously with the final installment in the third quarter of 2017. | |||
Following the agreement dated April 1, 2015, and after giving effect to the $3,000,000 partial prepayment discussed above, the outstanding loan amount of $40,375,000 is required to be repaid in 4 consecutive quarterly installments of $712,500, followed by 7 consecutive quarterly installments of $1,425,000, plus a balloon repayment of $27,550,000 payable simultaneously with the final installment in the third quarter of 2017. | |||
Covenants (as defined in the respective loan agreement): | |||
The ratio of EBITDA to net interest expenses is waived until December 31, 2015, and thereafter shall not be less than 3.00:1.00. | |||
The market value adjusted net worth of the Company is waived until December 31, 2015, and thereafter shall not be less than $100,000,000. | |||
Maintain liquid assets requirement is waived until December 31, 2015, and thereafter shall equal an amount of no less than $650,000 per vessel at all times. | |||
The ratio of maximum net debt to total assets expressed as a percentage is waived until December 31, 2015, and thereafter shall not exceed 80%. | |||
The aggregate fair market value of the mortgaged vessels to outstanding loan ratio is waived until December 31, 2015, and thereafter shall exceed 120%. | |||
(b) Unicredit Bank AG (November 19, 2007): On September 13, 2013, the Company agreed with Unicredit Bank AG (“Unicredit”) to extend the expiration date of the existing waiver relating to the financial covenant of total liabilities to EBITDA ratio for two quarters, from January 1, 2014 to July 1, 2014, for a nominal fee and an advance payment of $1,500,000 to partially prepay the upcoming three quarterly loan installments, starting with the installment due in the fourth quarter of 2013. The advance payment of $1,500,000 was paid on September 13, 2013. On January 20, 2014, the Company agreed with Unicredit to extend the existing waiver relating to the financial covenant of total liabilities to EBITDA ratio until January 1, 2015. On July 30, 2014, the Company agreed with Unicredit, subject to certain closing conditions including a $7,000,000 prepayment, to eliminate the financial covenants relating to the minimum debt service coverage ratio, the minimum market value adjusted net worth and the maximum leverage ratio until the maturity of the loan. In addition, the Company also agreed to increase the required ratio of the fair market value of mortgaged vessels to outstanding loan from 110% to 130% at all times. The Company prepaid the amount of $7,000,000 on September 30, 2014, which was applied against a pro-rate reduction of the remaining installments, excluding the balloon repayment. Furthermore, on March 27, 2015, the Company entered into a loan supplemental agreement and agreed to amended terms with Unicredit, including the deferral of one and a portion of five of its scheduled quarterly installments due in the second quarter of 2015 through the third quarter of 2016, and the waiver of the minimum liquid assets requirement and the security ratio covenant until the maturity of the loan. | |||
The main terms and conditions of the loan agreement dated November 19, 2007, as subsequently amended, are as follows: | |||
The loan agreement is secured by a first priority mortgage on the vessels: M/V Calm Seas and M/V Deep Seas. | |||
The loan bears interest at LIBOR, plus a margin of (i) 2.75% on the outstanding amount of the loan, less any amounts that are deferred, and (ii) 5.00% on the amounts of the loan that have been deferred, excluding any amounts deferred pursuant to the supplemental agreement dated March 27, 2015. | |||
Excluding the supplemental agreement dated March 27, 2015 discussed above, the outstanding loan amount as of December 31, 2014 of $14,606,500 is required to be repaid in 7 consecutive quarterly installments of $480,500, plus a balloon repayment of $11,243,000 payable simultaneously with the final installment in the third quarter of 2016. | |||
Following the supplemental agreement dated March 27, 2015 discussed above, the outstanding loan amount as of December 31, 2014 of $14,606,500 is required to be repaid in 1 quarterly installment of $480,500 in the first quarter of 2015, while no installment is due in the second quarter of 2015, followed by 5 consecutive quarterly installments of $240,250, plus a balloon repayment of $12,924,750 payable simultaneously with the final installment in the third quarter of 2016. | |||
Covenants: The financial and security cover ratio covenants contained in the facility have been permanently waived until the maturity of the loan, pursuant to the supplemental agreement dated March 27, 2015. | |||
(c)Bank of Scotland Plc (December 4, 2007): On June 10, 2014, the Company completed the refinancing of the M/V Coral Seas and the M/V Golden Seas as discussed below, and repaid in full the then outstanding indebtedness under its existing loan agreement with Bank of Scotland Plc dated December 4, 2007. | |||
(d)Bank of Ireland (March 30, 2009): On July 25, 2014, the Company agreed with Bank of Ireland to eliminate the financial covenant relating to the minimum debt service coverage ratio until the maturity of the loan. In addition, on September 30, 2014, the Company proceeded with a prepayment of $4,000,000 with respect to its loan agreement with Bank of Ireland in return for a reduction in the next eight quarterly installments and an increase in the balloon at maturity. In addition, on March 27, 2015, the Company agreed with Bank of Ireland to waive 50% of the installment due in the first quarter of 2015, until April 30, 2015. | |||
The main terms and conditions of the loan agreement dated March 30, 2009, as subsequently amended, are as follows: | |||
The loan agreement is secured by a first priority mortgage on the vessel M/V Kind Seas. | |||
The loan bears interest at LIBOR, plus a margin of 2.50%. | |||
The outstanding loan amount as of December 31, 2014, of $8,350,000 is required to be repaid in 3 consecutive quarterly installments of $350,000, followed by 4 consecutive quarterly installments of $400,000, followed by 3 consecutive quarterly installments of $1,000,000, plus a balloon repayment of $2,700,000 payable simultaneously with the final installment in the second quarter of 2017. | |||
Covenants (as defined in the respective loan agreement): | |||
The minimum requirement of market value adjusted net worth of the Company is waived until December 31, 2014 and thereafter, shall not be less than $50,000,000. | |||
The leverage ratio is waived until December 31, 2014 and thereafter, shall not be greater than 0.80:1.00. | |||
Minimum liquid assets requirement is waived until December 31, 2014 and thereafter, the Company shall maintain liquid assets in an amount of no less than $500,000 per vessel at all times. | |||
The fair market value of the mortgaged vessel to outstanding loan ratio is waived until December 31, 2014 and thereafter, shall exceed 110%. | |||
(e-1)HSH Nordbank AG (July 31, 2008): On July 7, 2014, the Company completed the refinancing of the M/V Friendly Seas as discussed below, and repaid in full the then outstanding indebtedness under its existing loan agreement with HSH Nordbank AG (“HSH”) dated July 31, 2008. | |||
(e-2)HSH Nordbank AG (April 4, 2014): On April 4, 2014, the Company completed the documentation for a new loan agreement with HSH for a $47,000,000 secured loan facility for the refinancing of the M/V Friendly Seas and the partial financing of the first two Ultramax newbuilding drybulk carriers, the Hull numbers DY152 and DY153. For M/V Friendly Seas, HSH agreed to finance the lower of $12,600,000 or 60% of the vessel’s market value upon the respective drawdown date. For each of the two Ultramax vessels, HSH agreed to finance the lower of $17,200,000 or 65% of the vessels’ market value upon their delivery. On July 7, 2014, the Company completed the refinancing of the M/V Friendly Seas. The Company drew a total amount of $12,600,000 and repaid in full the then outstanding indebtedness under its existing loan agreement with HSH (dated July 31, 2008). In addition, in October 2014, the Company took delivery of its first two Ultramax drybulk carriers; the M/V Gentle Seas and the M/V Peaceful Seas (Hull numbers DY152 and DY153). The Company drew a total amount of $34,400,000, which was used for the payment of the final installment of the two vessels to the shipyard (refer to Note 5). | |||
The main terms and conditions of the loan agreement dated April 4, 2014 are as follows: | |||
The loan agreement is secured by a first priority mortgage on the vessels: M/V Friendly Seas, M/V Gentle Seas and M/V Peaceful Seas. | |||
The loan bears interest at LIBOR, plus a margin of 3.25%. | |||
The outstanding loan amount as of December 31, 2014, of $46,713,600 consists of the following: (i) $12,313,600 relating to the M/V Friendly Seas, which is required to be repaid in 26 consecutive quarterly installments of $286,400, plus a balloon repayment of $4,867,200 payable simultaneously with the final installment in the second quarter of 2021, and (ii) $34,400,000 relating to the M/V Gentle Seas and the M/V Peaceful Seas, which is required to be repaid in 28 consecutive quarterly installments of $506,000, plus a balloon repayment of $20,232,000 payable simultaneously with the final installment in the fourth quarter of 2021. | |||
Covenants (as defined in the respective loan agreement): | |||
The aggregate fair market value of the mortgaged vessels to outstanding loan ratio shall exceed 125%. | |||
(f)HSBC Bank Plc (July 2, 2010): On April 8, 2014, the Company signed a supplemental agreement with HSBC Bank Plc (“HSBC”) and agreed to amend the definitions of certain financial covenants, to prepay an amount of $800,000 that was prepaid on April 10, 2014, and to reduce the outstanding scheduled quarterly installments from $400,000 to $380,000, commencing from the second quarter of 2014. In addition, on August 1, 2014, the Company agreed with HSBC to extend the existing waivers for the financial covenants relating to the minimum interest and debt service coverage ratios, from June 30, 2014 to December 31, 2015. | |||
The main terms and conditions of the loan agreement dated July 2, 2010, as subsequently amended, are as follows: | |||
The loan is secured by a first priority mortgage on the vessel M/V Dream Seas. | |||
The loan bears interest at LIBOR, plus a margin of 3.00%. | |||
The outstanding loan amount as of December 31, 2014, of $14,460,000 is required to be repaid in 23 consecutive quarterly installments of $380,000, plus a balloon repayment of $5,720,000 payable simultaneously with the final installment in the third quarter of 2020. | |||
Covenants (as defined in the respective loan agreement): | |||
The ratio of total net debt to EBITDA shall be applicable and not exceed 9.00:1.00 from January 1, 2016 until December 31, 2016 and 8.00:1.00 thereafter. | |||
The ratio of EBITDA to interest expense shall be applicable and not be less than 2.50:1.00 from January 1, 2016 until the final maturity of the facility. | |||
The market value adjusted net worth of the Company shall be at least $50,000,000 until December 31, 2013 and $100,000,000 thereafter. | |||
The ratio of total net debt to value adjusted total assets shall be applicable and not greater than 0.80:1.00 from January 1, 2014 until the final maturity of the facility. | |||
The fair market value of the mortgaged vessel to outstanding loan ratio shall exceed 105% until December 31, 2013, 110% until December 31, 2014 and 120% thereafter. | |||
(g-1)Nordea Bank Finland Plc (May 5, 2011): On January 7, 2014, we took delivery of our fourth Handysize drybulk vessel; the M/V Proud Seas (refer to Notes 5 and 6). Upon the delivery of the vessel, we drew the total amount of the then undrawn portion of the facility of $25,394,427, by mortgaging both the M/V Priceless Seas and the M/V Proud Seas. On June 10, 2014, the Company completed the refinancing of the M/V Prosperous Seas, the M/V Precious Seas, the M/V Priceless Seas and the M/V Proud Seas as discussed below, and repaid in full the then outstanding indebtedness under its existing syndicated loan facility led by Nordea Bank Finland Plc (“Nordea”) dated May 5, 2011. | |||
(g-2)Nordea Bank Finland Plc (May 6, 2014): On May 6, 2014, the Company completed the documentation for a senior secured loan facility with a syndicate of major European banks led by Nordea in an amount of $160,000,000. This facility will be used for the refinancing of six vessels of its operating fleet (the four Handysize vessels M/V Prosperous Seas, M/V Precious Seas, M/V Priceless Seas and the M/V Proud Seas, and the Panamax vessels M/V Coral Seas and M/V Golden Seas), along with the financing of up to 60% of the market value of the remaining two Ultramax newbuilding drybulk carriers, the Hull numbers DY4050 and DY4052, and two of its Kamsarmax newbuilding drybulk carriers, the Hull numbers YZJ1144 and YZJ1145, that are expected to be delivered between the second and fourth quarter of 2015. On June 10, 2014, the Company completed the refinancing of the six vessels of its operating fleet discussed above. The Company drew a total amount of $81,750,000 and repaid in full the then outstanding indebtedness under its existing loan agreements with Bank of Scotland Plc (dated December 4, 2007) and Nordea (dated May 5, 2011). Such refinancing resulted in the write off of the unamortized financing costs of the respective facilities of $1,027,694, which is included in Interest and finance costs in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. | |||
The main terms and conditions of the loan agreement dated May 6, 2014 are as follows: | |||
The loan is secured by a first priority mortgage on the vessels: M/V Coral Seas, M/V Golden Seas, M/V Prosperous Seas, M/V Precious Seas, M/V Priceless Seas and M/V Proud Seas. | |||
The loan bears interest at LIBOR, plus any mandatory costs, plus a margin of 3.20%. | |||
The outstanding loan amount as of December 31, 2014, of $78,273,638 is required to be repaid in 22 consecutive quarterly installments of $1,738,181, plus a balloon repayment of $40,033,656 payable simultaneously with the final installment in the second quarter of 2020. | |||
Covenants (as defined in the respective loan agreement): | |||
The Company shall maintain a positive working capital at all times, excluding any balloon repayments of long-term loan facilities. | |||
There is available to the Company cash and cash equivalents (including restricted but unpledged cash representing minimum liquidity required to be maintained under any financial indebtedness) which are not subject to any security interest, in an amount of not less than the greater of (i) 6% of total financial indebtedness and (ii) $750,000 per vessel owned on the last day of the relevant test period. In the event that the Company pays any dividend or makes any other form of distribution, after the payment of such dividend or the making of such distribution there is available to the Company cash and cash equivalents in an amount of not less than the greater of (i) 8% of total financial indebtedness and (ii) $1,000,000 per vessel owned on the last day of the relevant test period. | |||
The ratio of market value adjusted shareholders’ equity to the market value adjusted total assets shall be equal to or greater than 30%. | |||
The aggregate fair market value of the mortgaged vessels to outstanding loan ratio shall exceed 135%. | |||
(h)Senior unsecured notes due 2021: On August 8, 2014, the Company completed the offering of 1,000,000 senior unsecured notes due 2021 (“Notes”), pursuant to its effective shelf registration statement. The Notes were issued in minimum denominations of $25.00 and integral multiples of $25.00 in excess thereof, and bear interest at a rate of 8.375% per year, payable quarterly on each February 15, May 15, August 15 and November 15, commencing on November 15, 2014. The Notes will mature on August 15, 2021, and may be redeemed in whole or in part at any time or from time to time after August 15, 2017. The net proceeds from the offering amounted to $23,856,583, net of underwriting discounts and commissions of $812,500, and offering expenses payable by the Company of $330,917. The Notes trade on NASDAQ under the symbol “PRGNL”. | |||
The indenture governing the Notes contains certain restrictive covenants, including limitations on asset sales and: | |||
Limitation on Borrowings: Net borrowings not to exceed 70% of total assets. | |||
Limitation on Minimum Net Worth: Net worth to always exceed $100,000,000. | |||
China Development Bank (May 17, 2013): Following the sale of the 4,800 TEU containership newbuilding as discussed in Note 5, in the first quarter of 2014 the Company mutually agreed with China Development Bank to cancel the corresponding credit facility for the vessel. Such cancelation resulted in the write off of the unamortized financing costs of the respective facility of $483,054, which is included in Interest and finance costs in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. | |||
Additional Covenants: Each of the above loan and credit facilities are secured by first priority mortgages on all vessels described in Note 1, first assignments of all freights, earnings and insurances. They also contain covenants that require the Company to maintain adequate insurance coverage and to obtain the lender’s consent before it changes the flag, class or management of the vessels, or enter into a new line of business. The facilities include customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation and warranty, a cross-default to other indebtedness and non-compliance with security documents, and prohibits the Company from paying dividends if the Company is in default on its facilities and if, after giving effect to the payment of the dividend, the Company is in breach of a covenant. | |||
In addition, each of the above loan and credit facilities require a minimum balance of cash and cash equivalents to be maintained at all times with the respective lender, ranging from $400,000 to $750,000 per mortgaged vessel, in excess of any additional cash collateral to be maintained, as defined by the respective loan agreements. | |||
Certain of the above loan and credit facilities restrict the amount of dividends the Company may pay to $0.50 per share per annum and limit the amount of quarterly dividends the Company may pay to 100% of its net income for the immediately preceding financial quarter. In addition, under the existing loan and credit facilities, the Company is required to maintain minimum liquidity after payment of dividends equal to the greater of the next six months’ debt service, 8% of total financial indebtedness or $1,000,000 per vessel. Furthermore, according to the supplemental agreement the Company entered into with Unicredit on March 27, 2015 as discussed above, the Company is not permitted to declare or pay any dividends until all the deferred amounts of the facility’s repayment installments have been repaid in full. | |||
Covenants Compliance: As of December 31, 2014, the Company was in compliance with all debt covenants with respect to its debt agreements, with the exception of the security cover ratio covenant contained in the facility with Commerzbank. The respective breach was subsequently cured as in April 2015, the Company agreed with Commerzbank to waive the application of the security cover ratio covenant contained in the facility effective from December 31, 2014 until December 31, 2015 as discussed above. | |||
Given the current drybulk charter rates, it is probable that the Company will not be in compliance with the minimum working capital requirement and the minimum liquidity requirement contained in certain of its loan and credit facilities on the applicable measurement dates in 2015. Furthermore, based on the Company’s cash flow projections for 2015, cash on hand and cash provided by operating activities will not be sufficient to cover scheduled debt repayments due in 2015. The Company is currently in negotiations with such lenders to obtain waivers for the affected covenants. The Company is also exploring several alternatives aiming to manage its working capital requirements and other commitments if current drybulk charter rates remain at today’s low levels including negotiations for the restructuring of its loans. | |||
Other Information: As of December 31, 2014, the Company had an aggregate borrowing capacity of up to $78,000,000 with respect to the undrawn portion of the syndicated loan facility led by Nordea (dated May 6, 2014), for the partial financing of the outstanding newbuilding program as discussed above. | |||
The interest cost charged for the years ended December 31, 2012, 2013 and 2014 amounted to $5,673,906, $6,129,911 and $7,451,854, respectively. | |||
The capitalized interest for the years ended December 31, 2012, 2013 and 2014 amounted to $611,655, $786,263 and $1,618,836, respectively. | |||
The weighted average interest rate for the years ended December 31, 2012, 2013 and 2014 was 2.76%, 3.21% and 3.53%, respectively. |
Interest_Rate_Swaps
Interest Rate Swaps | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Interest Rate Swaps [Abstract] | ||||||||
Interest Rate Swaps | 10.Interest Rate Swaps | |||||||
The Company enters into interest rate swap transactions to manage interest costs and the risk associated with changing interest rates with respect to its variable interest rate loans and credit facilities. These interest rate swap transactions fix the interest rates as described below. | ||||||||
As of December 31, 2013 and 2014, the Company's outstanding interest rate swaps had a combined notional amount of $68,976,781 and $56,208,156, respectively. Details of the interest rate swap agreements which were effective during 2013 and 2014 are outlined below: | ||||||||
Interest rate swaps that did not qualify for hedge accounting: | ||||||||
Counterparty | Effective | Termination | Notional | Notional | Fixed rate | Floating | ||
date | date | amount | amount | rate | ||||
As of December 31, 2013 | As of December 31, 2014 | |||||||
Unicredit Bank AG (1) | 27-Aug-10 | 27-Aug-15 | $35,700,000 | $25,500,000 | 2.47% | 3-month LIBOR | ||
HSBC Bank Plc (2) | 10-Apr-12 | 10-Apr-17 | - | $4,560,000 | 1.49% | 3-month LIBOR | ||
HSH Nordbank AG (3) | 8-May-12 | 5-May-17 | - | $9,562,500 | 1.22% | 3-month LIBOR | ||
Nordea Bank Finland Plc (4) | 4-May-12 | 31-Mar-17 | - | $5,918,792 | 1.14% | 3-month LIBOR | ||
Nordea Bank Finland Plc (5) | 18-Jun-12 | 4-May-17 | - | $5,885,615 | 1.01% | 3-month LIBOR | ||
HSH Nordbank AG (6) | 6-Aug-12 | 5-May-17 | - | $4,781,250 | 0.98% | 3-month LIBOR | ||
TOTAL | $35,700,000 | $56,208,157 | ||||||
Interest rate swaps that qualified for hedge accounting: | ||||||||
Counterparty | Effective | Termination | Notional | Notional | Fixed rate | Floating | ||
date | date | amount | amount | rate | ||||
As of December 31, 2013 | As of December 31, 2014 | |||||||
HSBC Bank Plc (2) | 10-Apr-12 | 10-Apr-17 | $5,040,000 | - | 1.49% | 3-month LIBOR | ||
HSH Nordbank AG (3) | 8-May-12 | 5-May-17 | $10,312,500 | - | 1.22% | 3-month LIBOR | ||
Nordea Bank Finland Plc (4) | 4-May-12 | 31-Mar-17 | $6,401,958 | - | 1.14% | 3-month LIBOR | ||
Nordea Bank Finland Plc (5) | 18-Jun-12 | 4-May-17 | $6,366,073 | - | 1.01% | 3-month LIBOR | ||
HSH Nordbank AG (6) | 6-Aug-12 | 5-May-17 | $5,156,250 | - | 0.98% | 3-month LIBOR | ||
TOTAL | $33,276,781 | - | ||||||
(1) The notional amount reduces by $2,550,000 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(2) The notional amount reduces by $120,000 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(3) The notional amount reduces by $187,500 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(4) The notional amount reduces by $120,792 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(5) The notional amount reduces by $120,115 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(6) The notional amount reduces by $93,750 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
Following the $800,000 prepayment to HSBC and the refinancing of the loan agreements with HSH dated July 31, 2008 and Nordea dated May 5, 2011 as discussed in Note 9, the Company reassessed the criteria for hedge accounting with respect to the corresponding interest rate swaps and concluded that same were no longer met. Accordingly, all the above interest rate swaps did not qualify for hedge accounting as of December 31, 2014. | ||||||||
Financial_Instruments_and_Fair
Financial Instruments and Fair Value Disclosures | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Financial Instruments and Fair Value Disclosures [Abstract] | ||||
Financial Instruments and Fair Value Disclosures | 11.Financial Instruments and Fair Value Disclosures | |||
The principal financial assets of the Company consist of cash and cash equivalents, restricted cash, trade receivables, amounts due from related parties, an investment in affiliate and marketable securities available for sale. The principal financial liabilities of the Company consist of long-term bank loans, senior unsecured notes due 2021, interest rate swaps, trade accounts payable, amounts due to related parties and accrued liabilities. | ||||
(a) Interest rate risk: The Company’s long-term bank loans are based on LIBOR and hence the Company is exposed to movements in LIBOR. The Company entered into interest rate swap agreements, discussed in Note 10, in order to hedge its variable interest rate exposure. | ||||
(b) Concentration of credit risk: Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of trade receivables, amounts due from related parties and cash and cash equivalents. The Company limits its credit risk with trade receivables by performing ongoing credit evaluations of its customers’ financial condition and generally does not require collateral for its trade receivables. In addition, the Company also limits its exposure by diversifying among customers. The amounts due from related parties mainly relate to advance payments to Allseas to cover working capital equal to one month’s worth of estimated operating expenses. The Company places its cash and cash equivalents with high credit quality financial institutions. The Company performs periodic evaluations of the relative credit standing of those financial institutions. The Company is exposed to credit risk in the event of non-performance by counterparties to derivative instruments. However, the Company limits its exposure by diversifying among counterparties considering their credit ratings. | ||||
(c) Fair value: The carrying values of cash and cash equivalents, restricted cash, trade receivables, amounts due from related parties, trade accounts payable, amounts due to related parties and accrued liabilities are reasonable estimates of their fair value due to the short-term nature of these financial instruments. The fair value of long-term bank loans approximate their carrying value, predominantly due to the variable interest rate nature thereof. Derivative financial instruments are stated at fair values. | ||||
The Company’s Notes trade on NASDAQ under the symbol “PRGNL” and therefore are considered Level 1 items in accordance with the fair value hierarchy. As of December 31, 2014, the fair value of the Company’s Notes based on their quoted close price of $17.00 per Note was $17,000,000 in the aggregate. | ||||
When the interest rate swap contracts qualify for hedge accounting, the Company recognizes the effective portion of the gain / (loss) on the hedging instruments directly in other comprehensive income / (loss) in the statement of shareholders’ equity, while any ineffective portion, if any, is recognized immediately in current period statement of comprehensive income / (loss). When the interest rate swap contracts do not qualify for hedge accounting, the Company recognizes their fair value changes in current period statement of comprehensive income / (loss). | ||||
Information on the location and amounts of derivative fair values in the consolidated balance sheets and derivative gains / (losses) in the consolidated statements of comprehensive income / (loss) and shareholders’ equity are shown below: | ||||
Derivative Instruments – Balance Sheet Location | ||||
31-Dec-13 | 31-Dec-14 | |||
Balance Sheet Location | Fair Value | Fair Value | ||
Derivatives designated as hedging instruments | ||||
Interest rate swaps | Non-Current Assets – Interest rate swaps | ($87,295) | $- | |
Interest rate swaps | Current liabilities – Interest rate swaps | 294,505 | - | |
Interest rate swaps | Long-Term Liabilities – Interest rate swaps | 22,683 | - | |
Subtotal | $229,893 | $- | ||
Derivatives not designated as hedging instruments | ||||
Interest rate swaps | Non-Current Assets – Interest rate swaps | $- | ($66,475) | |
Interest rate swaps | Current liabilities – Interest rate swaps | 685,960 | 589,896 | |
Interest rate swaps | Long-Term Liabilities – Interest rate swaps | 359,433 | 17,369 | |
Subtotal | $1,045,393 | $540,790 | ||
Total derivatives | $1,275,286 | $540,790 | ||
Effect of Derivative Instruments designated as hedging instruments | ||||
Gain Recognized in Accumulated Other Comprehensive Loss – Effective Portion | ||||
Year Ended December 31, | ||||
2013 | 2014 | |||
Interest rate swaps | $131,112 | $131,238 | ||
Total | $131,112 | $131,238 | ||
Location of Loss Transferred from Accumulated Other Comprehensive Loss in Statements of Comprehensive Loss – Effective Portion | ||||
Year Ended December 31, | ||||
2013 | 2014 | |||
Interest rate swaps – Realized Loss | Interest and finance costs | ($312,069) | ($98,656) | |
Total | ($312,069) | ($98,656) | ||
There was no ineffective portion of the gain / (loss) on the hedging instruments for the years ended December 31, 2013 and 2014. | ||||
Effect of Derivative Instruments not designated as hedging instruments | ||||
Year Ended December 31, | ||||
Location of Gain / (Loss) Recognized | 2013 | 2014 | ||
Interest rate swaps – Fair value | Loss on derivatives, net | $834,829 | $504,602 | |
Interest rate swaps – Realized Loss | Loss on derivatives, net | -930,117 | -892,342 | |
Net loss on derivatives | ($95,288) | ($387,740) | ||
Financial Instruments and Assets that are measured at fair value on a recurring basis | ||||
Interest rate swaps | ||||
The fair value of the Company’s interest rate swap agreements (refer to Note 10) is determined using a discounted cash flow approach based on market-based LIBOR swap yield rates. LIBOR swap rates are observable at commonly quoted intervals for the full terms of the swaps and therefore are considered Level 2 items in accordance with the fair value hierarchy. | ||||
The following table summarizes the valuation of the Company’s interest rate swaps as of December 31, 2013 and 2014. | ||||
Financial Instruments | Significant Other Observable Inputs (Level 2) | |||
31-Dec-13 | 31-Dec-14 | |||
Interest rate swaps – asset | ($87,295) | ($66,475) | ||
Interest rate swaps – liability | 1,362,581 | 607,265 | ||
Total | $1,275,286 | $540,790 | ||
Marketable securities – shares of Korea Line Corporation (“KLC”): | ||||
The number of KLC shares held by the Company was 65,896 and 44,550 as of December 31, 2013 and 2014, respectively. These marketable securities have readily determinable fair values and are classified as available for sale. Such marketable securities are measured subsequently at fair value in the accompanying consolidated balance sheets. Unrealized gains / (losses) from available for sale securities are excluded from the statement of comprehensive income / (loss) and are recognized in accumulated other comprehensive income / (loss) until realized. | ||||
Pursuant to the amended KLC rehabilitation plan, on May 9, 2013, 58,483 additional shares of KLC were issued to the Company, increasing the total number of KLC shares held by the Company to 65,896. Based on the closing price of KLC shares as of May 9, 2013, the fair value of the 58,483 additional KLC shares was $3,113,306, which was recognized as gain from marketable securities, net and is included in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2013. The decline of the fair value of the total 65,896 KLC shares as of September 30, 2013 and December 31, 2013, based on the respective latest publicly available information, was considered as other than temporary and therefore an aggregate loss of $1,911,212 was recognized. The respective loss is included in gain from marketable securities, net in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2013, after reclassifying this amount from the Company’s other comprehensive income / (loss). | ||||
In 2014, the Company sold a total of 21,346 KLC shares at an average sale price of $23.52 per share. Following the sale of such shares, the number of KLC shares held by the Company was 44,550. The total cash received from the sale of these shares amounted to $498,056, net of commissions. A loss from marketable securities, net, of $25,529 was recorded for the year ended December 31, 2014, after reclassifying same from the Company’s other comprehensive income / (loss). | ||||
The fair value of the 44,550 KLC shares as of December 31, 2014, based on the respective latest publicly available information, was $955,535. The corresponding loss on change in the fair value of $137,208 was recognized in other comprehensive income / (loss). | ||||
Furthermore, in April 2015, the Company sold an additional 18,133 KLC shares at an average sale price of $22.62 per share. Following the sale of such shares, the number of KLC shares held by the Company was 26,417. The total cash expected to be received from the sale of these shares amounts to $406,808, net of commissions (based on U.S. dollar/KRW exchange rate of $1.000:KRW1,096.92 as of April 15, 2015). | ||||
Location of Recognized Gain / (Loss) from Marketable Securities | ||||
Year Ended December 31, | ||||
Location of Gain / (Loss) Recognized | 2013 | 2014 | ||
Gain / (Loss) | Gain / (Loss) | |||
Marketable securities – Initial measurement | (Gain) / loss from marketable securities, net | $3,113,306 | $- | |
Marketable securities – Realized Loss | (Gain) / loss from marketable securities, net | -1,911,212 | -25,529 | |
Net gain / (loss) from marketable securities | $1,202,094 | ($25,529) | ||
The fair value of the KLC shares is based on quoted prices of KLC share of stock (Korea SE: KS) and is considered to be determined through Level 1 inputs of the fair value hierarchy. | ||||
The following table summarizes the valuation of the KLC shares as of December 31, 2013 and 2014. | ||||
Financial Assets | Quoted Prices in Active Markets (Level 1) | |||
31-Dec-13 | 31-Dec-14 | |||
KLC Shares – Marketable Securities | $1,616,329 | $955,535 | ||
Financial Assets that are measured at fair value on a non-recurring basis | ||||
Investment in Box Ships Inc.: | ||||
For the years ended December 31, 2013 and 2014, in accordance with the accounting guidance relating to loss in value of an investment that is other than a temporary decline, the Company recognized an impairment loss on its investment in Box Ships’ common shares. | ||||
The decline in the fair value of the investment in Box Ships based on the closing price of Box Ships’ common share as of September 30, 2013 and December 31, 2013, was considered as other than temporary and therefore an aggregate loss of $8,229,551 was recognized. The respective loss is included in loss on investment in affiliate in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2013. | ||||
The decline in the fair value of the investment in Box Ships based on the closing price of Box Ships’ common share as of March 31, 2014, June 30, 2014 and December 31, 2014, was considered as other than temporary and therefore an aggregate loss of $8,618,664 was recognized. The respective loss is included in loss on investment in affiliate in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. | ||||
Location of Impairment Loss on Investment in Affiliate | ||||
Year Ended December 31, | ||||
Location of Loss Recognized | 2013 | 2014 | ||
Dilution effect | Loss on investment in affiliate | ($390,821) | ($221,679) | |
Impairment loss | Loss on investment in affiliate | -8,229,551 | -8,618,664 | |
Loss on investment in affiliate | ($8,620,372) | ($8,840,343) | ||
The fair value of the investment in Box Ships is based on quoted prices of Box Ships share of stock (NYSE: TEU) and is considered to be determined through Level 1 inputs of the fair value hierarchy. | ||||
The following table summarizes the valuation of the Company’s investment in Box Ships as of December 31, 2013 and 2014. | ||||
Financial Assets | Quoted Prices in Active Markets (Level 1) | |||
31-Dec-13 | 31-Dec-14 | |||
Investment in equity affiliate – Box Ships Inc. | $11,309,375 | $2,956,250 | ||
The fair value of the investment in Box Ships, based on the closing price of Box Ships’ common share on the NYSE on April 15, 2015, of $1.06, was $3,643,750. | ||||
As of December 31, 2013 and 2014, the Company did not have any assets or liabilities measured at fair value on a recurring or non-recurring basis, other than the ones discussed above. | ||||
Capital_Structure
Capital Structure | 12 Months Ended |
Dec. 31, 2014 | |
Capital Structure [Abstract] | |
Capital Structure | 12.Capital Structure |
(a)Common Stock: | |
Under the amended and restated articles of incorporation, the Company's authorized common stock consists of 755,000,000 shares of common stock, par value $0.001 per share, divided into 750,000,000 Class A common shares and 5,000,000 Class B common shares. | |
Each holder of Class A common shares is entitled to one vote on all matters submitted to a vote of shareholders. Subject to preferences that may be applicable to any outstanding shares of preferred stock, holders of Class A common shares are entitled to receive ratably all dividends, if any, declared by the Company's Board of Directors out of funds legally available for dividends. Upon dissolution, liquidation or sale of all or substantially all of the Company's assets, after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any, Class A common shareholders are entitled to receive pro rata the Company's remaining assets available for distribution. Holders of Class A common shares do not have conversion, redemption or pre-emptive rights. | |
On December 24, 2012, the Company entered into an agreement to sell 4,901,961 newly-issued Class A common shares to Innovation Holdings, an entity beneficially owned by Mr. Michael Bodouroglou, the Company’s Chairman, President, Chief Executive Officer and Interim Chief Financial Officer, for a total consideration of $10,000,000. The transaction closed on December 24, 2012. In addition, Innovation Holding also received customary registration rights in respect of the common shares it received in the private placement. The documentation entered into in connection with the private placement was approved by the independent member of the Company’s Board of Directors. | |
Effective February 15, 2013, 98,039 Class A common shares, representing the 2.0% of the 4,901,961 newly-issued Class A common shares sold to Innovation Holdings discussed above, were granted to Loretto. The fair value of such shares based on the average of the high-low trading price of the shares on February 15, 2013, was $335,784, which was recorded as share based compensation and is included in Management fees – related party in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2013. | |
On September 27, 2013, the Company completed a public offering of 6,000,000 of its Class A common shares at $5.75 per share, including the full exercise of the over-allotment option granted to the underwriters to purchase up to 782,609 additional common shares. The net proceeds from the offering, which amounted to $31,881,984, net of underwriting discounts and commissions of $2,070,000 and other offering expenses of $548,016, would be used to fund the initial deposits and other costs associated with the purchase of two Ultramax newbuilding drybulk carriers, the Hull numbers DY152 and DY153, as discussed in Note 5, and general corporate purposes. In connection with the offering, effective September 27, 2013, 120,000 Class A common shares, representing the 2.0% of the 6,000,000 Class A common shares sold in the public offering, were granted to Loretto. The fair value of such shares based on the average of the high-low trading price of the shares on September 27, 2013, was $714,000, which was recorded as share based compensation and is included in Management fees – related party in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2013. | |
On February 18, 2014, the Company completed a public offering of 6,785,000 of its Class A common shares at $6.25 per share, including the full exercise of the over-allotment option granted to the underwriters to purchase up to 885,000 additional common shares. The net proceeds from the offering amounted to $39,741,152, net of underwriting discounts and commissions and other offering expenses payable by the Company. In connection with the offering, effective February 18, 2014, 135,700 Class A common shares, representing the 2.0% of the 6,785,000 Class A common shares sold in the public offering, were granted to Loretto. The fair value of such shares based on the average of the high-low trading price of the shares on February 18, 2014, was $880,015, which was recorded as share based compensation and is included in Management fees – related party in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. | |
On May 12, 2014, the Company’s Board of Directors authorized a share buyback program of up to $10,000,000 for a period of twelve months. The Company expects to repurchase these shares in the open market, at times and prices that are considered to be appropriate by the Company, but is not obligated under the terms of the program to repurchase any shares. Pursuant to the share buyback program, as of December 31, 2014, the Company had purchased and cancelled 30,000 of its common shares at an average price of $5.6820 per share. | |
As of December 31, 2013 and 2014, the Company had a total of 17,669,442 and 24,809,142 Class A common shares outstanding, respectively, and no other class of shares outstanding. | |
(b)Preferred Stock: | |
Under the amended and restated articles of incorporation, the Company's authorized preferred stock consists of 25,000,000 shares of preferred stock, par value $0.001 per share, and there was none issued and outstanding at December 31, 2013 and 2014. | |
Share_Based_Payments_Equity_In
Share Based Payments - Equity Incentive Plan - Non-vested Share Awards | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Share Based Payments - Equity Incentive Plan - Non-vested Share Awards [Abstract] | |||||||
Share Based Payments - Equity Incentive Plan - Non-vested Share Awards | 13.Share Based Payments | ||||||
Equity incentive plan – October 11, 2006 | |||||||
On October 11, 2006, the Company adopted an equity incentive plan, under which the officers, key employees and directors of the Company will be eligible to receive options to acquire shares of Class A common shares. The Board of Directors administers the plan. Under the terms of the plan, the Board of Directors are able to grant new options exercisable at a price per Class A common share to be determined by the Board of Directors but in no event less than fair market value as of the date of grant. The plan also permits the Board of Directors to award non-vested share units, non-qualified options, stock appreciation rights and non-vested shares. | |||||||
On March 26, 2014, the Company’s Board of Directors approved to cancel the remaining Class A common shares reserved for issuance under the equity incentive plan. | |||||||
Equity incentive plan – March 26, 2014 | |||||||
On March 26, 2014, the Company adopted an equity incentive plan, under which the officers, key employees and directors of the Company will be eligible to receive options to acquire shares of Class A common shares. A total of 2,000,000 Class A common shares were reserved for issuance under the plan. The Board of Directors administers the plan. Under the terms of the plan, the Board of Directors are able to grant new options exercisable at a price per Class A common share to be determined by the Board of Directors but in no event less than fair market value as of the date of grant. The plan also permits the Board of Directors to award non-vested share units, non-qualified options, stock appreciation rights and non-vested shares. | |||||||
(a)Options | |||||||
As of December 31, 2013 and 2014, there were 2,800 options with an exercise price of $120.00 outstanding and exercisable, which vested in 2010. Their weighted average remaining contractual life was 1.89 years as of December 31, 2014. | |||||||
There were no unvested share options as of December 31, 2013 and 2014. | |||||||
(b)Non-vested share awards | |||||||
Until the forfeiture of any non-vested share award, all non-vested share awards regardless of whether vested, the grantee has the right to vote such non-vested share awards, to receive and retain all regular cash dividends paid on such non-vested share awards with no obligation to return the dividend if employment ceases and to exercise all other rights provided that the Company will retain custody of all distributions other than regular cash dividends made or declared with respect to the non-vested share awards. All share awards are conditioned upon the option holder's continued service as an employee of the Company, or a director through the applicable vesting date. The Company estimates the forfeitures of non-vested share awards to be immaterial. The Company will, however, re-evaluate the reasonableness of its assumption at each reporting period. | |||||||
The accounting guidance relating to the Share based payments describes two generally accepted methods of accounting for non-vested share awards with a graded vesting schedule for financial reporting purposes: 1) the "accelerated method", which treats an award with multiple vesting dates as multiple awards and results in a front-loading of the costs of the award and 2) the "straight-line method" which treats such awards as a single award. Management has selected the straight-line method with respect to the non-vested share awards because it considers each non-vested share award to be a single award and not multiple awards, regardless of the vesting schedule. Additionally, the "front-loaded" recognition of compensation cost that results from the accelerated method implies that the related employee services become less valuable as time passes, which management does not believe to be the case. The grant date fair value is considered to be the average between the relevant highest and lowest price recorded on the grant date. | |||||||
The details of the non-vested share awards as of December 31, 2014, are outlined as follows: | |||||||
Equity incentive plan – October 11, 2006 | |||||||
Grant date | Final Vesting date | Total shares granted | Grant date fair value | Shares cancelled | Shares vested | Non-vested share awards | |
26-Nov-13 | 31-Dec-15 | 200,000 | $5.17 | - | 100,000 | 100,000 | |
26-Nov-13 | 31-Dec-15 | 12,000 | $5.17 | - | 6,000 | 6,000 | |
19-Dec-13 | 31-Dec-15 | 16,000 | $6.38 | - | 8,000 | 8,000 | |
31-Jan-14 | 31-Dec-15 | 32,000 | $6.67 | 3,000 | 14,500 | 14,500 | |
TOTAL | 260,000 | 3,000 | 128,500 | 128,500 | |||
Equity incentive plan – March 26, 2014 | |||||||
Grant date | Final Vesting date | Total shares granted | Grant date fair value | Shares cancelled | Shares vested | Non-vested share awards | |
10-Dec-14 | 31-Dec-16 | 200,000 | $2.44 | - | - | 200,000 | |
10-Dec-14 | 31-Dec-16 | 20,000 | $2.44 | - | - | 20,000 | |
TOTAL | 220,000 | - | - | 220,000 | |||
A summary of the activity for non-vested share awards for the year ended December 31, 2014 is as follows: | |||||||
Number | Weighted | ||||||
of Shares | Average | ||||||
Fair Value | |||||||
Non-vested, December 31, 2013 | 339,000 | $4.75 | |||||
Granted | 252,000 | 3.64 | |||||
Cancelled | -3,000 | 6.67 | |||||
Vested | -239,500 | 4.63 | |||||
Non-vested, December 31, 2014 | 348,500 | $4.15 | |||||
The remaining unrecognized compensation cost amounting to $1,189,936 as of December 31, 2014, is expected to be recognized over the remaining weighted average period of 1.3 year, according to the contractual terms of those non-vested share awards. | |||||||
On February 26, 2015, 70,000 non-vested Class A common shares were granted to employees of Allseas, with a grant date fair value of $1.865 per share, which will vest ratably over a two-year period commencing on December 31, 2015. | |||||||
On March 17, 2015, 30,000 non-vested Class A common shares were granted to executive officers of Allseas, with a grant date fair value of $1.310 per share, which will vest ratably over a two-year period commencing on December 31, 2015. | |||||||
Share based compensation amounted to $2,536,702, $805,469 and $986,416 for the years ended December 31, 2012, 2013 and 2014, respectively and is included in general and administrative expenses. | |||||||
Gain_from_Vessel_Early_Redeliv
Gain from Vessel Early Redelivery and Other (Income) / Expenses | 12 Months Ended |
Dec. 31, 2014 | |
Gain from Vessel Early Redelivery and Other (Income) / Expenses [Abstract] | |
Gain from Vessel Early Redelivery and Other (Income) / Expenses | 14.Gain from Vessel Early Redelivery and Other (Income) / Expenses |
Gain from vessel early redelivery represents income recognized in connection with the early termination of period time charters resulting from a request of the respective vessel charterers for which the Company received cash compensation of $0, $2,267,818 and $0 in 2012, 2013 and 2014, respectively. | |
Other income for the year ended December 31, 2012, relates mainly to claim recoveries for damages that had been incurred in one of the Company’s vessels of $703,422, and to a cash compensation of $29,137 received from KLC as the first annual installment in connection with the settlement agreement dated September 15, 2011. | |
Other income for the year ended December 31, 2013, relates mainly to a cash compensation of $402,596 received from KLC representing the present value of the total outstanding cash payments the Company was entitled to receive in connection with the settlement agreement dated September 15, 2011 and pursuant to the amended KLC rehabilitation plan that was approved by the Seoul Central District Court in March 2013, and to claim recoveries of $218,634 relating to a dispute regarding one of the Company’s vessels. | |
During the third quarter of 2014, the Company recognized a charge of $250,283, in relation to a special contribution, which was paid in October 2014. According to the Greek Law 4301/2014, the charge is a voluntary contribution calculated based on the carrying capacity of the Company’s fleet, and is payable annually for four fiscal years, until 2017. The special contribution is included in Other expenses in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. |
Income_Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2014 | |
Income Taxes [Abstract] | |
Income Taxes | 15.Income Taxes |
The Company and its subsidiaries are incorporated either in the Marshall Islands or Liberia and under the laws of the Marshall Islands and Liberia, are not subject to income taxes. | |
The Company is also subject to United States federal income taxation in respect of income that is derived from the international operation of ships and the performance of services directly related thereto ("Shipping Income"), unless exempt from United States federal income taxation. | |
If the Company does not qualify for the exemption from tax under Section 883, it will be subject to a 4% tax on its “U.S. source shipping income,” imposed without the allowance for any deductions. For these purposes, "U.S. source shipping income" means 50% of the shipping income that will be derived by the Company that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States. For 2012, 2013 and 2014, the Company qualified for the benefits of Section 883. |
Earnings_per_Share_EPS
Earnings per Share ("EPS") | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Earnings per Share ("EPS") [Abstract] | ||||||
Earnings per Share ("EPS") | 16.Earnings per Share (“EPS”) | |||||
The following table sets forth the computation of basic and diluted net loss per share for the years ended December 31, 2012, 2013 and 2014: | ||||||
Basic EPS – Class A Common Shares | ||||||
The two class method EPS is calculated as follows: | ||||||
Years Ended December 31, | ||||||
Numerators | 2012 | 2013 | 2014 | |||
Net loss | ($17,557,125) | ($16,953,032) | ($51,796,181) | |||
Less: Net loss attributable to non-vested share awards | 444,326 | 351,877 | 832,333 | |||
Net loss attributable to common shareholders | ($17,112,799) | ($16,601,155) | ($50,963,848) | |||
Denominators | ||||||
Weighted average common shares outstanding, basic and diluted | 6,035,910 | 12,639,128 | 23,326,062 | |||
Net loss per common share, basic and diluted: | ($2.84) | ($1.31) | ($2.18) | |||
Weighted Average Shares – Basic - In calculating basic EPS, the Company includes the effect of vested share awards and Class A common shares issued for exercised stock option awards from the date they are issued or vested. | ||||||
Weighted Average Shares – Diluted - In calculating diluted EPS, the Company includes the potential dilution that could occur if securities or other contracts to issue common stock were exercised. In calculating diluted EPS, the following dilutive securities are included in the shares outstanding unless their effect is anti-dilutive: | ||||||
Unvested share awards outstanding under the Company’s Stock Incentive Plan | ||||||
Class A common shares issuable upon exercise of the Company’s outstanding options | ||||||
The Company excluded the dilutive effect of 2,800 (2012 and 2013: 2,800) stock option awards, and 348,500 (2012: 58,335 and 2013: 339,000) non-vested share awards in calculating dilutive EPS for its Class A common shares as their effect was anti-dilutive. | ||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |
Dec. 31, 2014 | ||
Commitments and Contingencies [Abstract] | ||
Commitments and Contingencies | 17.Commitments and Contingencies | |
From time to time the Company expects to be subject to legal proceedings and claims in the ordinary course of business, principally personal injury and property casualty claims. Such claims, even if lacking in merit, could result in the expenditure of significant financial and managerial resources. The Company is not aware of any claim or contingent liability, which is reasonably possible and should be disclosed, or probable and for which a provision should be established in the accompanying financial statements. | ||
Rental Expense | ||
In relation to the rental agreement with Granitis as discussed in Note 4, fixed future minimum non-cancelable rent commitments as of December 31, 2014, based on the Euro/U.S. dollar exchange rate of €1.0000:$1.2140 as of December 31, 2014, amount to: | ||
For the year ending | Amount | |
31-Dec-15 | $44,508 | |
31-Dec-16 | 44,508 | |
31-Dec-17 | 33,381 | |
Total | $122,397 | |
Charter Hire | ||
Future minimum charter hire receipts, based on vessels committed to non-cancelable time charter contracts (including fixture recaps) as of December 31, 2014, net of commissions are: | ||
For the year ending | Amount | |
31-Dec-15 | $4,308,843 | |
Total | $4,308,843 | |
Charter hires are not generally received when a vessel is off-hire, including time required for normal periodic maintenance of the vessel. In arriving at the minimum future charter revenues, an estimated off-hire time of 18 days to perform any scheduled dry-docking on each vessel has been deducted, and it has been assumed that no additional off-hire time is incurred, although there is no assurance that such estimate will be reflective of the actual off-hire in the future. | ||
Newbuildings | ||
Future newbuilding installments based on the non-cancelable newbuilding contracts as of December 31, 2014 are: | ||
For the year ending | Amount | |
31-Dec-15 | $101,700,617 | |
Total | $101,700,617 | |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | 18.Subsequent Events |
Related Party Agreements | |
In January 2015, the Company’s vessel owning subsidiaries signed amended and restated management agreements with Allseas, and brokerage services agreements with Seacommercial, as discussed in Note 4. | |
Inactive Non-Vessel Owning Subsidiaries | |
In March and April 2015, the Company proceeded with the dissolution of certain inactive non-vessel owning subsidiaries, as discussed in Note 1. | |
Loan and Credit Facilities | |
In March and April 2015, the Company agreed with Unicredit and Commerzbank to amend certain terms of the facilities, including the deferral or the partial deferral of certain scheduled quarterly installments, and the waiver of certain financial and security cover ratio covenants, as discussed in Note 9. | |
In addition, on March 27, 2015, the Company agreed with Bank of Ireland to waive 50% of the installment due in the first quarter of 2015, until April 30, 2015, as discussed in Note 9. | |
Sale of KLC Shares | |
In April 2015, the Company sold a total of 18,133 KLC shares at an average sale price of $22.62 per share, as discussed in Note 11 . | |
Significant_Accounting_Policie1
Significant Accounting Policies (Policy) | 12 Months Ended |
Dec. 31, 2014 | |
Significant Accounting Policies [Abstract] | |
Principles of Consolidation | (a) Principles of Consolidation: The consolidated financial statements incorporate the financial statements of the Company. Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statements of comprehensive income / (loss) from the effective date of acquisition and up to the effective date of disposal, as appropriate. All intercompany balances and transactions have been eliminated. Paragon, as the holding company, determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a variable interest entity. Under ASC 810 “Consolidation” a voting interest entity is an entity in which the total equity investment at risk is sufficient to enable the entity to finance itself independently and provides the equity holders with the obligation to absorb losses, the right to receive residual returns and the right to make financial and operating decisions. The holding company consolidates voting interest entities in which it owns all, or at least a majority (generally, greater than 50%) of the voting interest. Variable interest entities (“VIE”) are entities as defined under ASC 810 that in general either do not have equity investors with voting rights or that have equity investors that do not provide sufficient financial resources for the entity to support its activities. The determination of whether a reporting entity is required to consolidate another entity is based on, among other things, the other entity’s design and purpose and the reporting entity’s power, through voting or similar rights, to direct the activities of the other entity that most significantly impact the other entity’s economic performance. A controlling financial interest in a VIE is present when a company has the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE, or both. Only one reporting entity, known as the primary beneficiary, is expected to be identified as having a controlling financial interest and thus is required to consolidate the VIE. The Company evaluates all arrangements that may include a variable interest in an entity to determine if it may be the primary beneficiary, and would be required to include assets, liabilities and operations of a VIE in its consolidated financial statements. As of December 31, 2013 and 2014, no such interest existed. |
Use of Estimates | (b) Use of Estimates: The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Other Comprehensive Income / (Loss) | (c) Other Comprehensive Income / (Loss): The Company follows the accounting guidance relating to “Comprehensive Income,” which requires separate presentation of certain transactions that are recorded directly as components of stockholders’ equity. The Company has elected to present net income / (loss) and other comprehensive income / (loss) in a single continuous statement of comprehensive income / (loss) in its consolidated financial statements. |
Foreign Currency Translation | (d) Foreign Currency Translation: The functional currency of the Company is the U.S. Dollar. For other than derivative instruments, each asset, liability, revenue, expense, gain or loss arising from a foreign currency transaction is measured and recorded in the functional currency using the exchange rate in effect at the date of the transaction. As of balance sheet date, monetary assets and liabilities that are denominated in a currency other than the functional currency are adjusted to reflect the exchange rate prevailing at the balance sheet date and any gains or losses are included in the statements of comprehensive income / (loss). As of December 31, 2013 and 2014, the Company had no foreign currency derivative instruments. |
Cash and Cash Equivalents | (e) Cash and Cash Equivalents: The Company considers highly liquid investments such as time deposits and certificates of deposit with an original maturity of three months or less to be cash equivalents. |
Restricted Cash | (f) Restricted Cash: Restricted cash represents pledged cash deposits or minimum liquidity required to be maintained under the Company’s borrowing arrangements or in relation to bank guarantees issued on behalf of the Company. In the event that the obligation to maintain such deposits is expected to be terminated within the next twelve months, or relates to general minimum liquidity requirements with no obligation to retain such funds in retention accounts, these deposits are classified as current assets. Otherwise they are classified as non-current assets. |
Trade Receivables (net) | (g) Trade Receivables (net): Trade receivables (net), reflect the receivables from charters, net of an allowance for doubtful accounts. At each balance sheet date, all potentially uncollectible accounts are assessed individually for purposes of determining the appropriate provision for doubtful accounts. Allowance for doubtful accounts as of December 31, 2013 and 2014 was $265,751 and $409,226, respectively. |
Insurance Claims | (h) Insurance Claims: The Company records insurance claim recoveries for insured losses incurred on damages to fixed assets and for insured crew medical expenses under Other receivables. Insurance claims are recorded, net of any deductible amounts, at the time the Company’s fixed assets suffer insured damages or when crew medical expenses are incurred, recovery is probable under the related insurance policies and the Company can make an estimate of the amount to be reimbursed following submission of the insurance claim. |
Inventories | (i) Inventories: Inventories consist of lubricants and stores on board the vessels. When vessels are unemployed or are operating under voyage charters, bunkers on board are also recorded in inventories. Inventories are stated at the lower of cost or market. Cost is determined by the first in, first out method. |
Vessel Cost | (j) Vessel Cost: Vessels are stated at cost, which consists of the contract price, less discounts, plus any direct expenses incurred upon acquisition, including improvements, commission paid, delivery expenses and other expenditures to prepare the vessel for her initial voyage. Financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels’ cost. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Repairs and maintenance are expensed as incurred. |
Impairment of Long-Lived Assets | (k) Impairment of Long-Lived Assets: The Company reviews its long-lived assets “held and used” for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. When the estimate of future undiscounted cash flows, excluding interest charges, expected to be generated by the use of the asset is less than its carrying amount, the Company evaluates the asset for an impairment loss. The Company measures an impairment loss as the difference between the carrying value of the asset and its fair value. In this respect, management regularly reviews the carrying amount of the vessels in connection with the estimated recoverable amount for each of the Company’s vessels. |
The undiscounted projected net operating cash flows for each vessel are determined by considering the contracted charter revenues from existing charters for the fixed vessel days and an estimated daily time charter equivalent for the unfixed days (based on the most recent ten year historical average of similar size vessels) over the remaining estimated life of the vessel, assumed to be 25 years from the date of initial delivery from the shipyard, net of brokerage commissions, the salvage value of each vessel, which is estimated to be $300 per lightweight ton, expected outflows for vessels’ future dry-docking expenses and estimated vessel operating expenses, assuming an average annual inflation rate where applicable. The Company uses the historical ten-year average as it is considered a reasonable estimation of expected future charter rates over the remaining useful life of the Company’s vessels since it represents a full shipping cycle that captures the highs and lows of the market. The Company utilizes the standard deviation in order to eliminate the outliers of the sample before computing the historic ten-year average of the one-year time charter rate. | |
Vessel Depreciation | (l) Vessel Depreciation: Depreciation is computed using the straight-line method over the estimated useful life of the vessels, after considering the estimated salvage value. Each vessel's salvage value is equal to the product of its lightweight tonnage and estimated scrap rate, which up until September 30, 2012, was estimated to be $150 per lightweight ton. In order to align the scrap rate estimates with the historical average scrap rate, effective from October 1, 2012, the Company adjusted the estimated scrap rate used to calculate the vessels’ salvage value from $150 to $300 per lightweight ton. The impact of the increase in the estimated scrap rate is a decrease in depreciation expense going forward. |
Management estimates the useful life of the Company’s vessels to be 25 years from the date of initial delivery from the shipyard, including secondhand vessels. Secondhand vessels are depreciated from the date of their acquisition through their remaining estimated useful life. | |
Other Fixed Assets | (m) Other Fixed Assets: Other fixed assets consist of computer systems installed on board the vessels to improve their efficiency, software and a vehicle. Other fixed assets are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the useful life of the assets, which is estimated to be 5 years for the computer systems software, and 6 years for the Company’s vehicle. Depreciation charged in the years ended December 31, 2012, 2013 and 2014 amounted to $135,095, $164,527 and $203,357, respectively. |
Investments in Affiliate | (n) Investments in Affiliate: Investments in the common stock of entities, in which the Company has significant influence over operating and financial policies, are accounted for using the equity method. Under this method, the investment in the affiliate is initially recorded at cost and is adjusted to recognize the Company’s share of the earnings or losses of the investee after the acquisition date and is adjusted for impairment whenever facts and circumstances indicate that a decline in fair value below the cost basis is other than temporary. The amount of the adjustment is included in the determination of net income / (loss). Differences between the carrying amount of the investment in affiliate and the amount of the Company’s underlying equity in the net assets of the affiliate is amortized over the remaining life of the affiliate’s tangible and intangible assets, and is included in Equity in net income / (loss) of affiliate in the consolidated statements of comprehensive income / (loss). Dividends received from an affiliate reduce the carrying amount of the investment. When the Company’s share of losses in an affiliate equals or exceeds its interest in the affiliate, the Company does not recognize further losses, unless the Company has incurred obligations or made payments on behalf of the affiliate. |
Dry-docking and Special Survey Costs | (o) Dry-docking and Special Survey Costs: Dry-docking and special survey costs are expensed in the period incurred. |
Financing Costs | (p) Financing Costs: Financing fees incurred for obtaining new loans and credit facilities are deferred and amortized to interest expense over the respective loan or credit facility using the effective interest rate method. Any unamortized balance of costs relating to loans repaid or refinanced is expensed in the period the repayment or refinancing is made, subject to the accounting guidance regarding debt extinguishment. Any unamortized balance of costs related to credit facilities repaid is expensed in the period. Any unamortized balance of costs relating to credit facilities refinanced are deferred and amortized over the term of the respective credit facility in the period the refinancing occurs, subject to the provisions of the accounting guidance relating to Debt – Modifications and Extinguishments. The unamortized financing costs are reflected in Other assets in the accompanying balance sheets. |
Debt restructurings | (q) Debt restructurings: The Company accounts for debt modifications or restructuring as troubled debt restructuring when a lender for economic or legal reasons related to the Company’s financial situation grants a concession that it would not otherwise consider. These concessions may include a reduction in the interest rate, principal or accrued interest, extension of the maturity date or other actions intended to minimize potential losses. The Company considers a lender to have granted a concession if the Company’s effective interest rate on the restructured debt is less than the effective interest rate of the old debt immediately before the restructuring. The Company considers the total future cash flows (defined as principal plus interest) of the restructured debt in comparison with the carrying value of the original debt. If a debt modification or restructuring is determined to be a troubled debt restructuring, the Company reduces the carrying amount of the debt when the debt balance is greater than the total future cash flows under the new terms, in which case a gain is recognized. When the total future cash flows of the restructured debt are greater than the carrying value at the date of amendment, the carrying value of the original debt is not adjusted. In a troubled debt restructuring in which the Company agrees to transfer assets to fully settle the debt, the Company recognizes a gain on restructuring for the difference between the carrying amount of the debt and the more clearly evident of: (a) the fair value of the transferred assets or (b) the fair value of the settled debt. |
Pension and Retirement Benefit Obligations - Crew | (r) Pension and Retirement Benefit Obligations—Crew: The vessel owning companies employ the crew on board under short-term contracts (usually up to nine months) and, accordingly, they are not liable for any pension or post-retirement benefits. |
Revenue and Expenses | (s) Revenue and Expenses: |
Revenue is recognized when a charter agreement exists, the vessel is made available to the charterer and collection of the related revenue is reasonably assured. | |
Time Charter Revenue: Time charter revenues are recorded ratably over the term of the charter as service is provided, including the amortization / accretion of the above / below market acquired time charters, where applicable. When two or more time charter rates are involved during the life term of a charter agreement, the Company recognizes revenue on a straight-line basis, and income accrued or deferred as a result is included in Other receivables or Deferred income, respectively. Time charter revenues received in advance of the provision of charter service are recorded as deferred income, and recognized when the charter service is rendered. | |
Revenue / Voyage charters: Voyage charter is a charter where a contract is made in the spot market for the use of a vessel for a specific voyage for a specified freight rate per ton. If a charter agreement exists and collection of the related revenue is reasonably assured, revenue is recognized as it is earned ratably during the duration of the period of each voyage. A voyage is deemed to commence upon the latest between the completion of discharge of the vessel’s previous cargo and the charter party date of the current voyage, and is deemed to end upon the completion of discharge of the current cargo. Demurrage income represents payments by a charterer to a vessel owner when loading or discharging time exceeds the stipulated time in the voyage charter and is recognized as it is earned. | |
Commissions: Charter hire commissions are deferred and amortized over the related charter period and are presented separately in the accompanying consolidated statements of comprehensive loss. | |
Voyage Expenses: Voyage expenses exclude commissions and consist of all costs that are unique to a particular voyage, primarily including port expenses, canal dues, war risk insurances and fuel costs. Voyage expenses also include losses from the sale of bunkers to charterers and bunkers consumed during off-hire periods and while traveling to and from dry-docking. | |
Vessel Operating Expenses: Vessel operating expenses are accounted for as incurred on the accrual basis. Vessel operating expenses include crew wages and related costs, the cost of insurance, expenses relating to repairs and maintenance, the cost of spares and consumable stores, and other miscellaneous expenses. | |
Share based Compensation | (t) Share based Compensation: Share based payments to employees and directors, including grants of employee and directors stock options, are recognized in the statements of comprehensive income / (loss) based on their grant date fair values and amortized over the required service period. |
Segment Reporting | (u) Segment Reporting: The Company reports financial information and evaluates its operations by charter revenues and not by the length of ship employment for its customers (i.e., spot vs. time charters) or by geographical region as the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographical information is impracticable. The Company does not have discrete financial information to evaluate the operating results for each type of charter. Although revenue can be identified for these types of charters, management cannot and does not identify expenses, profitability or other financial information for these charters. As a result, management, including the Chief Executive Officer being the chief operating decision maker, reviews operating results solely by revenue per day and operating results of the fleet, and thus the Company has determined that it operates under one reportable segment. |
Derivatives | (v) Derivatives: The Company enters into interest rate swap agreements to manage its exposure to fluctuations of interest rate risk associated with its borrowings. All derivatives are recognized in the consolidated financial statements at their fair value. The fair value of the interest rate derivatives is based on a discounted cash flow analysis. When such derivatives do not qualify for hedge accounting, the Company recognizes their fair value changes in current period earnings. When the derivatives qualify for hedge accounting, the Company recognizes the effective portion of the gain or loss on the hedging instrument directly in other comprehensive income / (loss), while the ineffective portion, if any, is recognized immediately in current period earnings. The Company, at the inception of the transaction, documents the relationship between the hedged item and the hedging instrument, as well as its risk management objective and the strategy of undertaking various hedging transactions. The Company also assesses at hedge inception of whether the hedging instruments are highly effective in offsetting changes in the cash flows of the hedged items. |
The Company discontinues cash flow hedge accounting if the hedging instrument expires and it no longer meets the criteria for hedge accounting or designation is revoked by the Company. At that time, any cumulative gain or loss on the hedging instrument recognized in equity is kept in equity until the forecasted transaction occurs. When the forecasted transaction occurs, any cumulative gain or loss on the hedging instrument is recognized in current period earnings. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognized in equity is transferred to current period earnings as financial income or expense. | |
Fair value of financial instruments | (w) Fair value of financial instruments: The fair value of the interest rate derivatives is based on a discounted cash flow analysis. |
In accordance with the requirements of accounting guidance relating to Fair Value Measurements, the Company classifies and discloses its assets and liabilities carried at fair value in one of the following three categories: | |
Level 1:Quoted market prices in active markets for identical assets or liabilities | |
Level 2:Observable market based inputs or unobservable inputs that are corroborated by market data | |
Level 3:Unobservable inputs that are not corroborated by market data. | |
Earnings per Share (EPS) | (x) Earnings per Share (EPS): The computation of basic earnings per share is based on the weighted average number of common shares outstanding during the period determined using the two-class method of computing earnings per share. Non-vested share awards issued are included in the two-class method and income attributable to non-vested share awards is deducted from the net income reported for purposes of calculating net income available to common shareholders used in the computation of basic earnings per share. The computation of diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised. Such securities include non-vested share awards for which the assumed proceeds upon grant are deemed to be the amount of compensation cost attributable to future services and are not yet recognized and common shares issuable upon exercise of the Company’s outstanding warrants, to the extent that they are dilutive, using the treasury method. |
Subsequent Events | (y) Subsequent Events: The Company evaluates subsequent events or transactions up to the date in which the financial statements are issued according to the requirements of ASC 855. |
Recent Accounting Pronouncements | (z) Recent Accounting Pronouncements: |
The Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued a standard that will supersede virtually all of the existing revenue recognition guidance in U.S. GAAP and is effective for annual periods beginning on or after December 15, 2016. The standard establishes a five-step model that will apply to revenue earned from a contract with a customer (with limited exceptions), regardless of the type of revenue transaction or the industry. The standard’s requirements will also apply to the recognition and measurement of gains and losses on the sale of some non-financial assets that are not an output of the entity’s ordinary activities (e.g., sales of property, plant and equipment or intangibles). Extensive disclosures will be required, including disaggregation of total revenue; information about performance obligations; changes in contract asset and liability account balances between periods and key judgments and estimates. Management is in the process of accessing the impact of the new standard on Company’s financial position and performance. | |
In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15 – Presentation of Financial Statements - Going Concern. ASU 2014-15 provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. ASU 2014-15 requires an entity’s management to evaluate at each reporting period based on the relevant conditions and events that are known at the date of financial statements are issued, whether there are conditions or events, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued and to disclose the necessary information. ASU 2014-15 is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. |
Basis_of_Presentation_and_Gene1
Basis of Presentation and General Information (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Basis of Presentation and General Information [Abstract] | |||||||
Drybulk Vessel Owning Subsidiaries | Vessel Owning Company | Date of | Country of | Vessel’s Name | Delivery Date | Built | DWT |
Incorporation | Incorporation | ||||||
Trade Force Shipping S.A. | 15-Nov-06 | Marshall Islands | Deep Seas | Dec-06 | 1999 | 72,891 | |
Frontline Marine Company | 15-Nov-06 | Marshall Islands | Calm Seas | Dec-06 | 1999 | 74,047 | |
Fairplay Maritime Ltd. | 15-Nov-06 | Marshall Islands | Kind Seas | Dec-06 | 1999 | 72,493 | |
Donna Marine | 4-Jul-07 | Marshall Islands | Pearl Seas | Aug-07 | 2006 | 74,483 | |
Co. | |||||||
Protea International Inc. | 17-Jul-07 | Liberia | Sapphire Seas | Aug-07 | 2005 | 53,702 | |
Reading Navigation Co. | 17-Jul-07 | Liberia | Diamond Seas | Sep-07 | 2001 | 74,274 | |
Imperator I Maritime Company | 27-Sep-07 | Marshall Islands | Coral Seas | Nov-07 | 2006 | 74,477 | |
Canyon I Navigation Corp. | 27-Sep-07 | Marshall Islands | Golden Seas | Dec-07 | 2006 | 74,475 | |
Paloma Marine | 19-Jun-08 | Liberia | Friendly Seas | Aug-08 | 2008 | 58,779 | |
S.A. | |||||||
Eris Shipping | 8-Apr-10 | Liberia | Dream Seas | Jul-10 | 2009 | 75,151 | |
S.A. | |||||||
Coral Ventures | 5-Aug-09 | Liberia | Prosperous Seas | May-12 | 2012 | 37,293 | |
Inc. | |||||||
Winselet Shipping And Trading Co. Ltd. | 6-Apr-10 | Liberia | Precious Seas | Jun-12 | 2012 | 37,205 | |
Aminta International S.A. | 5-May-10 | Liberia | Priceless | Jan-13 | 2013 | 37,202 | |
Seas | |||||||
Adonia Enterprises S.A. | 5-May-10 | Liberia | Proud | Jan-14 | 2014 | 37,227 | |
Seas (1) | |||||||
Alcyone International Marine Inc. | 17-Jun-13 | Liberia | Gentle Seas (1) | Oct-14 | 2014 | 63,350 | |
Neptune International Shipping & Trading S.A. | 17-Jun-13 | Liberia | Peaceful | Oct-14 | 2014 | 63,331 | |
Seas (1) | |||||||
(1) Refer to Notes 5 and 9 | |||||||
Vessel Under Construction Owning Subsidiaries | Vessel Owning Company | Date of | Country of | Hull Number | Type | Expected Delivery | DWT |
Incorporation | Incorporation | ||||||
Amphitrite Shipping Inc. | 17-Jun-13 | Liberia | DY4050 (1) | Drybulk Carrier | 2015 | 63,500 | |
Mirabel International Maritime Co. | 17-Jun-13 | Liberia | DY4052 (1) | Drybulk Carrier | 2015 | 63,500 | |
Dolphin Sunrise Limited | 25-Feb-14 | Marshall Islands | YZJ1144 (1) | Drybulk Carrier | 2015 | 81,800 | |
Nautilus Investment Limited | 25-Feb-14 | Marshall Islands | YZJ1145 (1) | Drybulk Carrier | 2015 | 81,800 | |
Oceanus Investments Limited | 25-Feb-14 | Marshall Islands | YZJ1142 (1) | Drybulk Carrier | 2015 | 81,800 | |
(1) Refer to Note 5 | |||||||
Non-Vessel Owning Subsidiaries | Non-Vessel Owning Company | Date of Incorporation | Country of Incorporation | ||||
Camelia Navigation S.A. | 15-Nov-06 | Marshall Islands | |||||
Explorer Shipholding Limited | 15-Nov-06 | Marshall Islands | |||||
Epic Investments Inc. | 21-Dec-06 | Marshall Islands | |||||
Opera Navigation Co. (1) | 21-Dec-06 | Marshall Islands | |||||
Ovation Services Inc. (1) | 16-Sep-09 | Marshall Islands | |||||
Irises Shipping Ltd. (1) | 6-Oct-09 | Marshall Islands | |||||
Letitia Shipping Limited (1) | 4-May-10 | Marshall Islands | |||||
Nereus Navigation Ltd. (1) | 4-May-10 | Marshall Islands | |||||
Ardelia Navigation Limited (1) | 15-Jun-10 | Liberia | |||||
Eridanus Trading Co. (1) | 1-Jul-10 | Liberia | |||||
Delfis Shipping Company S.A. (1) | 7-Feb-11 | Liberia | |||||
(1) In March and April 2015, the Company proceeded with the dissolution of the respective subsidiaries since they were no longer active | |||||||
Major Charterers | Charterer | Percentage of charter revenue | |||||
2012 | 2013 | 2014 | |||||
Intermare Transport GmbH | 24.10% | 13.40% | - | ||||
Morgan Stanley Capital Group Inc. | 15.70% | - | - | ||||
Mansel Ltd. | 16.60% | - | - | ||||
Cargill International S.A. | 19.20% | 33.60% | 11.60% | ||||
Total | 75.60% | 47.00% | 11.60% | ||||
Transactions_with_Related_Part1
Transactions with Related Parties (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Transactions with Related Parties [Abstract] | ||||
Related Party Transactions | 2012 | 2013 | 2014 | |
Included in Commissions | ||||
(1(i)) Charter hire commissions | $646,987 | $750,533 | $708,153 | |
Netted against Gain from sale of assets | ||||
(1(ii)) Vessel sale & purchase commissions | $- | $- | $745,000 | |
Included in Vessel operating expenses | ||||
(1(v)) Superintendent fees | $338,826 | $399,626 | $481,200 | |
Included in Dry-docking expenses | ||||
(1(v)) Superintendent fees | $- | $109,248 | $123,840 | |
Management fees - related party | ||||
(1(iii)) Management fees | $3,428,548 | $4,104,271 | $4,628,813 | |
(2) Financial accounting and reporting services | 666,196 | 720,361 | $757,442 | |
(3) Loretto agreement | - | 1,049,784 | $880,015 | |
Total Management fees | $4,094,744 | $5,874,416 | $6,266,270 | |
Included in General and administrative expenses | ||||
(4) Administrative fees | $36,085 | $38,598 | $37,746 | |
(7) Executive services agreement | $3,228,438 | $7,582,634 | $5,689,152 | |
Vessels_Net_Tables
Vessels, Net (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Vessels Net [Abstract] | ||||
Vessels, Net | Vessel | Accumulated | Net Book | |
Cost | Depreciation | Value | ||
Balance January 1, 2013 | $351,611,923 | ($53,235,483) | $298,376,440 | |
Newbuilding deliveries | 24,581,533 | - | 24,581,533 | |
Depreciation for the period | - | -16,822,057 | -16,822,057 | |
Balance December 31, 2013 | $376,193,456 | ($70,057,540) | $306,135,916 | |
Newbuilding deliveries | 81,051,077 | - | 81,051,077 | |
Depreciation for the period | - | -18,154,020 | -18,154,020 | |
Balance December 31, 2014 | $457,244,533 | ($88,211,560) | $369,032,973 | |
Other_Assets_Tables
Other Assets (Tables) | 12 Months Ended | |
Dec. 31, 2014 | ||
Other Assets [Abstract] | ||
Deferred Financing Costs | ||
Balance January 1, 2013 | $2,596,029 | |
Additions | 642,825 | |
Amortization | -941,733 | |
Balance December 31, 2013 | $2,297,121 | |
Additions | 4,172,546 | |
Amortization | -2,108,716 | |
Balance December 31, 2014 | $4,360,951 | |
Investment_in_Affiliate_Tables
Investment in Affiliate (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Investment in Affiliate [Abstract] | |||
Investment in Affiliate | Balance January 1, 2013 | $19,987,743 | |
Equity in net income of affiliate | 1,652,339 | ||
Equity in other comprehensive income of affiliate | 77,165 | ||
Dividends received | -1,787,500 | ||
Dilution effect | -390,821 | ||
Impairment in investment in affiliate | -8,229,551 | ||
Balance December 31, 2013 | $11,309,375 | ||
Equity in net income of affiliate | 471,079 | ||
Equity in other comprehensive income of affiliate | 16,139 | ||
Dilution effect | -221,679 | ||
Impairment in investment in affiliate | -8,618,664 | ||
Balance December 31, 2014 | $2,956,250 | ||
Summarized Income Statement Data in respect of Box Ships | Year ended December 31, | ||
INCOME STATEMENT DATA | 2013 | 2014 | |
Net revenue | $69,836,201 | $49,864,674 | |
Operating income | 23,631,192 | 1,966,947 | |
Net income | $15,307,658 | $2,623,515 | |
Summarized Balance Sheet Data in respect of Box Ships | As of December 31, | ||
BALANCE SHEET DATA | 2013 | 2014 | |
Total current assets | $31,691,262 | $22,011,255 | |
Total non-current assets | 397,915,376 | 375,837,950 | |
Total assets | 429,606,638 | 397,849,205 | |
Total current liabilities | 184,434,021 | 140,886,944 | |
Total long-term liabilities | $453,248 | $282,375 | |
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Long-Term Debt [Abstract] | |||
Debt Agreements Amounts Outstanding | 2013 | 2014 | |
(a)Commerzbank AG (August 12, 2011) | $47,550,000 | $43,375,000 | |
(b)Unicredit Bank AG (November 19, 2007) | 22,587,000 | 14,606,500 | |
(c)Bank of Scotland Plc (December 4, 2007) | 33,616,864 | - | |
(d)Bank of Ireland (March 30, 2009) | 13,400,000 | 8,350,000 | |
(e-1)HSH Nordbank AG (July 31, 2008) | 20,625,000 | - | |
(e-2)HSH Nordbank AG (April 4, 2014) | - | 46,713,600 | |
(f)HSBC Bank Plc (July 2, 2010) | 16,800,000 | 14,460,000 | |
(g-1)Nordea Bank Finland Plc (May 5, 2011) | 25,536,062 | - | |
(g-2)Nordea Bank Finland Plc (May 6, 2014) | - | 78,273,638 | |
(h)Senior unsecured notes due 2021 | - | 25,000,000 | |
Total | $180,114,926 | $230,778,738 | |
Schedule of Debt | Disclosed as follows in the Consolidated Balance Sheets | ||
Current portion of long-term debt | $17,257,750 | $20,714,324 | |
Long-term debt | 162,857,176 | 210,064,414 | |
Total | $180,114,926 | $230,778,738 | |
Minimum Annual Principal Payments | To December 31, | ||
2015 | $20,714,324 | ||
2016 | 32,226,824 | ||
2017 | 48,317,324 | ||
2018 | 11,642,324 | ||
2019 | 11,642,324 | ||
Thereafter | 106,235,618 | ||
Total | $230,778,738 | ||
Interest_Rate_Swaps_Tables
Interest Rate Swaps (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Interest Rate Swaps [Abstract] | ||||||||
Interest rate swaps that did not qualify for hedge accounting | Counterparty | Effective | Termination | Notional | Notional | Fixed rate | Floating | |
date | date | amount | amount | rate | ||||
As of December 31, 2013 | As of December 31, 2014 | |||||||
Unicredit Bank AG (1) | 27-Aug-10 | 27-Aug-15 | $35,700,000 | $25,500,000 | 2.47% | 3-month LIBOR | ||
HSBC Bank Plc (2) | 10-Apr-12 | 10-Apr-17 | - | $4,560,000 | 1.49% | 3-month LIBOR | ||
HSH Nordbank AG (3) | 8-May-12 | 5-May-17 | - | $9,562,500 | 1.22% | 3-month LIBOR | ||
Nordea Bank Finland Plc (4) | 4-May-12 | 31-Mar-17 | - | $5,918,792 | 1.14% | 3-month LIBOR | ||
Nordea Bank Finland Plc (5) | 18-Jun-12 | 4-May-17 | - | $5,885,615 | 1.01% | 3-month LIBOR | ||
HSH Nordbank AG (6) | 6-Aug-12 | 5-May-17 | - | $4,781,250 | 0.98% | 3-month LIBOR | ||
TOTAL | $35,700,000 | $56,208,157 | ||||||
Interest rate swaps that qualified for hedge accounting | Counterparty | Effective | Termination | Notional | Notional | Fixed rate | Floating | |
date | date | amount | amount | rate | ||||
As of December 31, 2013 | As of December 31, 2014 | |||||||
HSBC Bank Plc (2) | 10-Apr-12 | 10-Apr-17 | $5,040,000 | - | 1.49% | 3-month LIBOR | ||
HSH Nordbank AG (3) | 8-May-12 | 5-May-17 | $10,312,500 | - | 1.22% | 3-month LIBOR | ||
Nordea Bank Finland Plc (4) | 4-May-12 | 31-Mar-17 | $6,401,958 | - | 1.14% | 3-month LIBOR | ||
Nordea Bank Finland Plc (5) | 18-Jun-12 | 4-May-17 | $6,366,073 | - | 1.01% | 3-month LIBOR | ||
HSH Nordbank AG (6) | 6-Aug-12 | 5-May-17 | $5,156,250 | - | 0.98% | 3-month LIBOR | ||
TOTAL | $33,276,781 | - | ||||||
(1) The notional amount reduces by $2,550,000 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(2) The notional amount reduces by $120,000 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(3) The notional amount reduces by $187,500 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(4) The notional amount reduces by $120,792 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(5) The notional amount reduces by $120,115 on a quarterly basis up until the expiration of the interest rate swap. | ||||||||
(6) The notional amount reduces by $93,750 on a quarterly basis up until the expiration of the interest rate swap. |
Financial_Instruments_and_Fair1
Financial Instruments and Fair Value Disclosures (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Financial Instruments and Fair Value Disclosures [Abstract] | ||||
Derivative Instruments - Balance Sheet Location | 31-Dec-13 | 31-Dec-14 | ||
Balance Sheet Location | Fair Value | Fair Value | ||
Derivatives designated as hedging instruments | ||||
Interest rate swaps | Non-Current Assets – Interest rate swaps | ($87,295) | $- | |
Interest rate swaps | Current liabilities – Interest rate swaps | 294,505 | - | |
Interest rate swaps | Long-Term Liabilities – Interest rate swaps | 22,683 | - | |
Subtotal | $229,893 | $- | ||
Derivatives not designated as hedging instruments | ||||
Interest rate swaps | Non-Current Assets – Interest rate swaps | $- | ($66,475) | |
Interest rate swaps | Current liabilities – Interest rate swaps | 685,960 | 589,896 | |
Interest rate swaps | Long-Term Liabilities – Interest rate swaps | 359,433 | 17,369 | |
Subtotal | $1,045,393 | $540,790 | ||
Total derivatives | $1,275,286 | $540,790 | ||
Effect of Derivative Instruments designated as hedging instruments (Gain Recognized in Accumulated Other Comprehensive Loss - Effective Portion) | Year Ended December 31, | |||
2013 | 2014 | |||
Interest rate swaps | $131,112 | $131,238 | ||
Total | $131,112 | $131,238 | ||
Effect of Derivative Instruments designated as hedging instruments (Location of Loss Transferred from Accumulated Other Comprehensive Loss in Statements of Comprehensive Loss - Effective Portion) | Year Ended December 31, | |||
2013 | 2014 | |||
Interest rate swaps – Realized Loss | Interest and finance costs | ($312,069) | ($98,656) | |
Total | ($312,069) | ($98,656) | ||
Effect of Derivative Instruments not designated as hedging instruments | Year Ended December 31, | |||
Location of Gain / (Loss) Recognized | 2013 | 2014 | ||
Interest rate swaps – Fair value | Loss on derivatives, net | $834,829 | $504,602 | |
Interest rate swaps – Realized Loss | Loss on derivatives, net | -930,117 | -892,342 | |
Net loss on derivatives | ($95,288) | ($387,740) | ||
Summary of Valuation of Interest Rate Swaps | Financial Instruments | Significant Other Observable Inputs (Level 2) | ||
31-Dec-13 | 31-Dec-14 | |||
Interest rate swaps – asset | ($87,295) | ($66,475) | ||
Interest rate swaps – liability | 1,362,581 | 607,265 | ||
Total | $1,275,286 | $540,790 | ||
Location of Recognized Gain / (Loss) from Marketable Securities | Year Ended December 31, | |||
Location of Gain / (Loss) Recognized | 2013 | 2014 | ||
Gain / (Loss) | Gain / (Loss) | |||
Marketable securities – Initial measurement | (Gain) / loss from marketable securities, net | $3,113,306 | $- | |
Marketable securities – Realized Loss | (Gain) / loss from marketable securities, net | -1,911,212 | -25,529 | |
Net gain / (loss) from marketable securities | $1,202,094 | ($25,529) | ||
Summary of Valuation of Available For Sale Securites | Financial Assets | Quoted Prices in Active Markets (Level 1) | ||
31-Dec-13 | 31-Dec-14 | |||
KLC Shares – Marketable Securities | $1,616,329 | $955,535 | ||
Location of Impairment Loss on Investment in Affiliate | Year Ended December 31, | |||
Location of Loss Recognized | 2013 | 2014 | ||
Dilution effect | Loss on investment in affiliate | ($390,821) | ($221,679) | |
Impairment loss | Loss on investment in affiliate | -8,229,551 | -8,618,664 | |
Loss on investment in affiliate | ($8,620,372) | ($8,840,343) | ||
Summary of Valuation of Investment In Affiliate | Financial Assets | Quoted Prices in Active Markets (Level 1) | ||
31-Dec-13 | 31-Dec-14 | |||
Investment in equity affiliate – Box Ships Inc. | $11,309,375 | $2,956,250 | ||
Share_Based_Payments_Equity_In1
Share Based Payments - Equity Incentive Plan - Non-vested Share Awards (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Non-vested Share Awards Activity | Number | Weighted | |||||
of Shares | Average | ||||||
Fair Value | |||||||
Non-vested, December 31, 2013 | 339,000 | $4.75 | |||||
Granted | 252,000 | 3.64 | |||||
Cancelled | -3,000 | 6.67 | |||||
Vested | -239,500 | 4.63 | |||||
Non-vested, December 31, 2014 | 348,500 | $4.15 | |||||
Equity incentive plan - October 11, 2006 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Non-vested Share Awards Details | Grant date | Final Vesting date | Total shares granted | Grant date fair value | Shares cancelled | Shares vested | Non-vested share awards |
26-Nov-13 | 31-Dec-15 | 200,000 | $5.17 | - | 100,000 | 100,000 | |
26-Nov-13 | 31-Dec-15 | 12,000 | $5.17 | - | 6,000 | 6,000 | |
19-Dec-13 | 31-Dec-15 | 16,000 | $6.38 | - | 8,000 | 8,000 | |
31-Jan-14 | 31-Dec-15 | 32,000 | $6.67 | 3,000 | 14,500 | 14,500 | |
TOTAL | 260,000 | 3,000 | 128,500 | 128,500 | |||
Equity incentive plan - March 26, 2014 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Non-vested Share Awards Details | Grant date | Final Vesting date | Total shares granted | Grant date fair value | Shares cancelled | Shares vested | Non-vested share awards |
10-Dec-14 | 31-Dec-16 | 200,000 | $2.44 | - | - | 200,000 | |
10-Dec-14 | 31-Dec-16 | 20,000 | $2.44 | - | - | 20,000 | |
TOTAL | 220,000 | - | - | 220,000 | |||
Earnings_per_Share_EPS_Tables
Earnings per Share ("EPS") (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Earnings per Share ("EPS") [Abstract] | ||||||
Basic and diluted EPS Class A Common Shares | ||||||
Years Ended December 31, | ||||||
Numerators | 2012 | 2013 | 2014 | |||
Net loss | ($17,557,125) | ($16,953,032) | ($51,796,181) | |||
Less: Net loss attributable to non-vested share awards | 444,326 | 351,877 | 832,333 | |||
Net loss attributable to common shareholders | ($17,112,799) | ($16,601,155) | ($50,963,848) | |||
Denominators | ||||||
Weighted average common shares outstanding, basic and diluted | 6,035,910 | 12,639,128 | 23,326,062 | |||
Net loss per common share, basic and diluted: | ($2.84) | ($1.31) | ($2.18) | |||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |
Dec. 31, 2014 | ||
Commitments and Contingencies [Abstract] | ||
Rental Expense | For the year ending | Amount |
31-Dec-15 | $44,508 | |
31-Dec-16 | 44,508 | |
31-Dec-17 | 33,381 | |
Total | $122,397 | |
Charter Hire | For the year ending | Amount |
31-Dec-15 | $4,308,843 | |
Total | $4,308,843 | |
Newbuilding Commitments | For the year ending | Amount |
31-Dec-15 | $101,700,617 | |
Total | $101,700,617 | |
Basis_of_Presentation_and_Gene2
Basis of Presentation and General Information (Table) (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Deep Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 72,891 |
Vessel Year Built | 1999 |
Delivery Date | Dec-06 |
Date of Incorporation | 15-Nov-06 |
Calm Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 74,047 |
Vessel Year Built | 1999 |
Delivery Date | Dec-06 |
Date of Incorporation | 15-Nov-06 |
Kind Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 72,493 |
Vessel Year Built | 1999 |
Delivery Date | Dec-06 |
Date of Incorporation | 15-Nov-06 |
Pearl Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 74,483 |
Vessel Year Built | 2006 |
Delivery Date | Aug-07 |
Date of Incorporation | 4-Jul-07 |
Sapphire Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 53,702 |
Vessel Year Built | 2005 |
Delivery Date | Aug-07 |
Date of Incorporation | 17-Jul-07 |
Diamond Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 74,274 |
Vessel Year Built | 2001 |
Delivery Date | Sep-07 |
Date of Incorporation | 17-Jul-07 |
Coral Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 74,477 |
Vessel Year Built | 2006 |
Delivery Date | Nov-07 |
Date of Incorporation | 27-Sep-07 |
Golden Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 74,475 |
Vessel Year Built | 2006 |
Delivery Date | Dec-07 |
Date of Incorporation | 27-Sep-07 |
Friendly Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 58,779 |
Vessel Year Built | 2008 |
Delivery Date | Aug-08 |
Date of Incorporation | 19-Jun-08 |
Dream Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 75,151 |
Vessel Year Built | 2009 |
Delivery Date | Jul-10 |
Date of Incorporation | 8-Apr-10 |
Prosperous Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 37,293 |
Vessel Year Built | 2012 |
Delivery Date | May-12 |
Date of Incorporation | 5-Aug-09 |
Precious Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 37,205 |
Vessel Year Built | 2012 |
Delivery Date | Jun-12 |
Date of Incorporation | 6-Apr-10 |
Priceless Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 37,202 |
Vessel Year Built | 2013 |
Delivery Date | Jan-13 |
Date of Incorporation | 5-May-10 |
Proud Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 37,227 |
Vessel Year Built | 2014 |
Delivery Date | Jan-14 |
Date of Incorporation | 5-May-10 |
Gentle Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 63,350 |
Vessel Year Built | 2014 |
Delivery Date | Oct-14 |
Date of Incorporation | 17-Jun-13 |
Peaceful Seas | |
Property Plant And Equipment [Line Items] | |
DWT | 63,331 |
Vessel Year Built | 2014 |
Delivery Date | Oct-14 |
Date of Incorporation | 17-Jun-13 |
Hull DY4050 | |
Property Plant And Equipment [Line Items] | |
DWT | 63,500 |
Expected Delivery | 2015 |
Date of Incorporation | 17-Jun-13 |
Hull DY4052 | |
Property Plant And Equipment [Line Items] | |
DWT | 63,500 |
Expected Delivery | 2015 |
Date of Incorporation | 17-Jun-13 |
Hull YZJ1144 | |
Property Plant And Equipment [Line Items] | |
DWT | 81,800 |
Expected Delivery | 2015 |
Date of Incorporation | 25-Feb-14 |
Hull YZJ1145 | |
Property Plant And Equipment [Line Items] | |
DWT | 81,800 |
Expected Delivery | 2015 |
Date of Incorporation | 25-Feb-14 |
Hull YZJ1142 | |
Property Plant And Equipment [Line Items] | |
DWT | 81,800 |
Expected Delivery | 2015 |
Date of Incorporation | 25-Feb-14 |
Basis_of_Presentation_and_Gene3
Basis of Presentation and General Information - Non Vessel Owning Subsidiaries (Table) (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Camelia Navigation S.A. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 15-Nov-06 |
Explorer Shipholding Limited | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 15-Nov-06 |
Epic Investments Inc. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 21-Dec-06 |
Opera Navigation Co. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 21-Dec-06 |
Ovation Services Inc. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 16-Sep-09 |
Irises Shipping Ltd. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 6-Oct-09 |
Letitia Shipping Limited | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 4-May-10 |
Nereus Navigation Ltd. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 4-May-10 |
Ardelia Navigation Limited | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 15-Jun-10 |
Eridanus Trading Co. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 1-Jul-10 |
Delfis Shipping Company S.A. | |
Non-Vessel Owning Subsidiaries [Line Items] | |
Date of Incorporation | 7-Feb-11 |
Basis_of_Presentation_and_Gene4
Basis of Presentation and General Information - Major Charterers (Table) (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Entity Wide Revenue Major Customer [Line Items] | |||
Percentage of charter revenue | 11.60% | 47.00% | 75.60% |
Intermare Transport GmbH | |||
Entity Wide Revenue Major Customer [Line Items] | |||
Percentage of charter revenue | 0.00% | 13.40% | 24.10% |
Morgan Stanley Capital Group Inc. | |||
Entity Wide Revenue Major Customer [Line Items] | |||
Percentage of charter revenue | 0.00% | 0.00% | 15.70% |
Mansel Ltd. | |||
Entity Wide Revenue Major Customer [Line Items] | |||
Percentage of charter revenue | 0.00% | 0.00% | 16.60% |
Cargill International S.A. | |||
Entity Wide Revenue Major Customer [Line Items] | |||
Percentage of charter revenue | 11.60% | 33.60% | 19.20% |
Basis_of_Presentation_and_Gene5
Basis of Presentation and General Information (Details) | Dec. 31, 2014 |
Basis of Presentation and General Information [Abstract] | |
Ownership percentage by CEO | 28.40% |
Significant_Accounting_Policie2
Significant Accounting Policies (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property Plant And Equipment [Line Items] | |||||
Provision for Doubtful Accounts | $409,226 | $265,751 | |||
Vessels Salvage Value Per Lightweight Ton | $300 | $150 | |||
Depreciation | 18,357,377 | 16,986,584 | 16,386,426 | ||
Computer Systems Software | |||||
Property Plant And Equipment [Line Items] | |||||
Useful life | 5 years | ||||
Company Cars | |||||
Property Plant And Equipment [Line Items] | |||||
Useful life | 6 years | ||||
Other Fixed Assets | |||||
Property Plant And Equipment [Line Items] | |||||
Depreciation | $203,357 | $164,527 | $135,095 | ||
Vessels | |||||
Property Plant And Equipment [Line Items] | |||||
Useful life | 25 years |
Transactions_with_Related_Part2
Transactions with Related Parties (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Management fees - related party | |||
Total Management fees | $6,266,270 | $5,874,416 | $4,094,744 |
Allseas Marine SA | |||
Included in Commissions | |||
(1(i)) Charter hire commissions | 708,153 | 750,533 | 646,987 |
Netted against Gain from sale of assets | |||
(1(ii)) Vessel sale & purchase commissions | 745,000 | 0 | 0 |
Included in Vessel operating expenses | |||
(1(v)) Superintendent fees | 481,200 | 399,626 | 338,826 |
Included in Dry-docking expenses | |||
(1(v)) Superintendent fees | 123,840 | 109,248 | 0 |
Management fees - related party | |||
(1(iii)) Management fees | 4,628,813 | 4,104,271 | 3,428,548 |
(2) Financial accounting and reporting services | 757,442 | 720,361 | 666,196 |
(3) Loretto agreement | 880,015 | 1,049,784 | 0 |
Total Management fees | 6,266,270 | 5,874,416 | 4,094,744 |
Included in General and administrative expenses | |||
(4) Administrative fees | 37,746 | 38,598 | 36,085 |
(7) Executive services agreement | $5,689,152 | $7,582,634 | $3,228,438 |
Transactions_with_Related_Part3
Transactions with Related Parties - Allseas (Details) | 12 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | 12 Months Ended | 22 Months Ended | 12 Months Ended | 2 Months Ended | 9 Months Ended | 10 Months Ended | ||||||||||||||||||||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | 31-May-12 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | 31-May-14 | 31-May-13 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 18, 2014 | Sep. 27, 2013 | Dec. 31, 2013 | Dec. 31, 2014 | Feb. 15, 2013 | Feb. 18, 2014 | Sep. 27, 2013 | |
USD ($) | USD ($) | USD ($) | Allseas Marine SA | Allseas Marine SA | Allseas Marine SA | Allseas Marine SA | Allseas Marine SA | Allseas Marine SA | Allseas Marine SA | Superintedent services | Financial Accounting Services | Financial Reporting Services | Newbuildings Supervision | Newbuildings Supervision | Executive Services | Executive Services | Executive Services | Executive Services | Executive Services | Executive Services | Executive Services | Related Party | Related Party | Related Party | Loretto Finance Inc. | Loretto Finance Inc. | Loretto Finance Inc. | Loretto Finance Inc. | Loretto Finance Inc. | Public offerings | Public offerings | |
EUR (€) | EUR (€) | USD ($) | EUR (€) | EUR (€) | EUR (€) | USD ($) | EUR (€) | EUR (€) | USD ($) | USD ($) | EUR (€) | USD ($) | EUR (€) | USD ($) | EUR (€) | USD ($) | EUR (€) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | |||||||||
Related Party Transaction [Line Items] | ||||||||||||||||||||||||||||||||
Capitalized expenses | $3,804,918 | $1,588,512 | ||||||||||||||||||||||||||||||
Loss from contract cancellation | 0 | 568,658 | 0 | |||||||||||||||||||||||||||||
Loss from contract cancellation related party | 0 | 444,421 | 0 | |||||||||||||||||||||||||||||
Charter hire commission payable to the management company | 1.25% | 1.25% | ||||||||||||||||||||||||||||||
Commission rate payable to the management company for the purchase, sale and construction of vessels | 1.00% | 1.00% | ||||||||||||||||||||||||||||||
Daily management fee | 636.74 | 664.46 | 661.15 | 652.02 | ||||||||||||||||||||||||||||
Pre-delivery services amount payable | 15,000 | |||||||||||||||||||||||||||||||
Superintendents management fee payable | 500 | 500 | ||||||||||||||||||||||||||||||
Annual fee payable for financial accounting services | 250,000 | |||||||||||||||||||||||||||||||
Annual fee per vessel payable financial reporting services cost | 30,000 | |||||||||||||||||||||||||||||||
Common stock - shares issued | 135,700 | 120,000 | 469,958 | 98,039 | 6,785,000 | 6,000,000 | ||||||||||||||||||||||||||
Share based compensation | 880,015 | 714,000 | 335,784 | |||||||||||||||||||||||||||||
Flat fee for newbuilding supervision services | 375,000 | |||||||||||||||||||||||||||||||
Daily fee for newbuilding vessels' supervision | 115 | |||||||||||||||||||||||||||||||
Compensation for involuntary termination of contract | 3,642,000 | 3,000,000 | ||||||||||||||||||||||||||||||
Euro / U.S. dollar exchange rate | 1.214 | 1.214 | 1.214 | |||||||||||||||||||||||||||||
Annual executive services fee payable | 2,900,000 | 2,700,000 | 2,500,000 | |||||||||||||||||||||||||||||
Executive services agreement duration | 5yrs | 5yrs | ||||||||||||||||||||||||||||||
Annual executive services fee paid | 5,689,152 | 7,582,634 | 3,228,438 | |||||||||||||||||||||||||||||
Incentive compensation paid to executives | 1,848,900 | 3,993,000 | 0 | |||||||||||||||||||||||||||||
Percentage of the issued and oustanding shares of the company, issuable to the management company | 5.00% | |||||||||||||||||||||||||||||||
Due from related parties | $843,510 | $146,051 | $843,510 | $146,051 |
Transactions_with_Related_Part4
Transactions with Related Parties - Seacommercial (Details) (Seacommercial Shipping Services S.A.) | 0 Months Ended |
Jan. 02, 2015 | |
Seacommercial Shipping Services S.A. | |
Related Party Transaction [Line Items] | |
Charter hire commission payable to the management company | 1.25% |
Commission rate payable to the management company for the purchase, sale and construction of vessels | 1.00% |
Transactions_with_Related_Part5
Transactions with Related Parties - Granitis (Details) (Granitis Glyfada Real Estate Ltd.) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2012 | Dec. 31, 2007 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
EUR (€) | EUR (€) | USD ($) | USD ($) | USD ($) | |
Related Party Transaction [Line Items] | |||||
Initial rental agreement duration | 5yrs | 5yrs | |||
Initial monthly rental fee | € 3,000 | € 2,000 | |||
Rental fee additional tax | 3.60% | 3.60% | |||
Rent expense | $49,001 | $49,324 | $39,593 |
Transactions_with_Related_Part6
Transactions with Related Parties - Crewcare Inc. (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Related Party Transaction [Line Items] | |||
Due to related parties | $166,354 | $82,074 | |
Crewcare Inc. Manning Agency Agreements | |||
Related Party Transaction [Line Items] | |||
Monthly manning service fee per seaman | 95 | ||
One-off recruitment fees per seaman | 120 | ||
In-house training fee per seaman | 30 | ||
Extra in-house training fee per seaman | 50 | ||
Manning expenses | 441,499 | 382,517 | 321,648 |
Crewcare Inc. Cadetship Program Agreement | |||
Related Party Transaction [Line Items] | |||
Lump sum fee per cadet employed | 5,000 | ||
Cadetship program expenses | 360,000 | 15,000 | |
Crewcare Inc. | |||
Related Party Transaction [Line Items] | |||
Due to related parties | $166,354 | $82,074 |
Transactions_with_Related_Part7
Transactions with Related Parties - Box Ships Inc. (Details) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | 16 Months Ended | |||||||
Oct. 18, 2013 | Aug. 05, 2013 | Jul. 19, 2013 | Apr. 19, 2013 | Feb. 28, 2013 | Apr. 19, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 19, 2014 | 27-May-11 | |
Box Ships Inc. | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Percentage of ownership in Box Ships | 11.00% | 13.60% | |||||||||
Loan to affiliate - balance | $6,000,000 | $13,000,000 | $14,000,000 | $30,000,000 | |||||||
Loan to affiliate interest rate basis | LIBOR | ||||||||||
Loan pre-payment from affiliate | 6,000,000 | 5,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | ||||||
Quarterly loan repayment from affiliate | 1,000,000 | ||||||||||
Balloon payment - loan to affiliate | 9,000,000 | ||||||||||
Amendment fee | 65,000 | ||||||||||
Interest income related party | $0 | $439,326 | $675,856 | ||||||||
Margin Before Amendment | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Margin | 4.00% | ||||||||||
Margin After Amendment | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Margin | 5.00% |
Advances_for_Vessels_Under_Con1
Advances for Vessels Under Construction (Details) (USD $) | 12 Months Ended | 0 Months Ended | 9 Months Ended | 1 Months Ended | 6 Months Ended | 4 Months Ended | 5 Months Ended | 1 Months Ended | 3 Months Ended | ||||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jul. 07, 2014 | Oct. 15, 2014 | Feb. 11, 2014 | Jun. 30, 2014 | Apr. 25, 2014 | 23-May-12 | Jan. 29, 2014 | Mar. 25, 2014 | Mar. 28, 2014 | Dec. 09, 2013 | Dec. 08, 2013 | Mar. 05, 2014 | |
Property Plant And Equipment [Line Items] | |||||||||||||||
Impairment loss | $15,695,282 | $0 | $0 | ||||||||||||
Gain from sale of assets | 402,805 | 0 | 0 | ||||||||||||
Net proceeds from sale of assets | 9,995,000 | 0 | 0 | ||||||||||||
Proceeds from long-term debt | 179,144,427 | 0 | 28,908,750 | ||||||||||||
Newbuilding program | As of December 31, 2014, the Company’s newbuilding program consisted of two Ultramax drybulk carriers (Hull numbers DY4050 and DY4052) and three Kamsarmax drybulk carriers (Hull numbers YZJ1144, YZJ1145 and YZJ1142) with scheduled delivery between the second and fourth quarter of 2015. | As of December 31, 2013, the Company’s newbuilding program consisted of one Handysize drybulk carrier (Hull no. 625), two Ultramax drybulk carriers (Hull numbers DY152 and DY153) and one 4,800 TEU containership (C/V Box King) with expected deliveries in 2014, as well as two Ultramax drybulk carriers (Hull numbers DY4050 and DY4052) with expected deliveries in 2015. | |||||||||||||
HSH Nordbank AG (April 4, 2014) | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Proceeds from long-term debt | 12,600,000 | 34,400,000 | |||||||||||||
Hull no. DY4050 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Drybulk carrier capacity | 63,500 | ||||||||||||||
Acquisition cost of vessels | 28,250,000 | ||||||||||||||
Newbuilding contract price installment | 5,592,661 | 3,884,530 | |||||||||||||
Remaining contracted newbuilding installments | 18,772,809 | ||||||||||||||
Vessel purchase commission amount paid to the management company | 282,500 | ||||||||||||||
Hull no. DY4052 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Drybulk carrier capacity | 63,500 | ||||||||||||||
Acquisition cost of vessels | 28,250,000 | ||||||||||||||
Newbuilding contract price installment | 5,592,661 | 3,884,530 | |||||||||||||
Remaining contracted newbuilding installments | 18,772,809 | ||||||||||||||
Vessel purchase commission amount paid to the management company | 282,500 | ||||||||||||||
Hull no. DY4050 and Hull no. DY4052 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Acquisition cost of vessels | 56,500,000 | ||||||||||||||
C/V Box King | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Acquisition cost of vessels | 55,000,000 | 57,500,000 | |||||||||||||
Vessel purchase commission rate | 3.00% | ||||||||||||||
Impairment loss | 15,695,282 | ||||||||||||||
Containership capacity | 4,800 | ||||||||||||||
Sale price of vessel | 42,500,000 | ||||||||||||||
Reduction in contract price of vessel | 770,000 | ||||||||||||||
Gain from sale of assets | 402,805 | ||||||||||||||
Net proceeds from sale of assets | 9,995,000 | ||||||||||||||
M/V Gentle Seas (Hull no. DY152) and M/V Peaceful Seas (Hull no. DY153) | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Newbuilding contract price installment | 35,672,940 | ||||||||||||||
M/V Gentle Seas (Hull no. DY152) and M/V Peaceful Seas (Hull no. DY153) | HSH Nordbank AG (April 4, 2014) | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Proceeds from long-term debt | 34,400,000 | ||||||||||||||
M/V Proud Seas (Hull no. 625) | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Drybulk carrier capacity | 37,227 | ||||||||||||||
Newbuilding contract price installment | 21,637,078 | ||||||||||||||
Hull no. YZJ1144 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Drybulk carrier capacity | 81,800 | ||||||||||||||
Acquisition cost of vessels | 30,550,000 | ||||||||||||||
Newbuilding contract price installment | 9,165,000 | ||||||||||||||
Remaining contracted newbuilding installments | 21,385,000 | ||||||||||||||
Vessel purchase commission amount paid to the management company | 305,500 | ||||||||||||||
Hull no. YZJ1145 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Drybulk carrier capacity | 81,800 | ||||||||||||||
Acquisition cost of vessels | 30,550,000 | ||||||||||||||
Newbuilding contract price installment | 9,165,000 | ||||||||||||||
Remaining contracted newbuilding installments | 21,385,000 | ||||||||||||||
Vessel purchase commission amount paid to the management company | 305,500 | ||||||||||||||
Hull no. YZJ1142 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Drybulk carrier capacity | 81,800 | ||||||||||||||
Acquisition cost of vessels | 30,550,000 | ||||||||||||||
Newbuilding contract price installment | 9,165,000 | ||||||||||||||
Remaining contracted newbuilding installments | 21,385,000 | ||||||||||||||
Vessel purchase commission amount paid to the management company | 305,500 | ||||||||||||||
Allseas Marine SA | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Vessel purchase commission rate | 1.00% | 1.00% | |||||||||||||
Containerships | Hull no. 656 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Number of newbuildings cancelled | 1 | ||||||||||||||
Containerships | C/V Box King | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Number of newbuildings | 1 | ||||||||||||||
Handysize Vessels | M/V Proud Seas (Hull no. 625) | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Number of newbuildings | 1 | ||||||||||||||
Ultramax Vessels | Hull no. DY4050 and Hull no. DY4052 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Number of newbuildings | 2 | 2 | |||||||||||||
Ultramax Vessels | M/V Gentle Seas (Hull no. DY152) and M/V Peaceful Seas (Hull no. DY153) | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Number of newbuildings | 2 | ||||||||||||||
Kamsarmax Vessels | Hull no. YZJ1144, Hull no. YZJ1145 and Hull no. YZJ1142 | |||||||||||||||
Property Plant And Equipment [Line Items] | |||||||||||||||
Acquisition cost of vessels | $91,650,000 | ||||||||||||||
Number of newbuildings | 3 |
Vessels_Net_Table_Details
Vessels, Net (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property Plant And Equipment [Line Items] | |||
Balance beginning of period | $306,135,916 | ||
Depreciation for the period | -18,357,377 | -16,986,584 | -16,386,426 |
Balance end of period | 369,032,973 | 306,135,916 | |
Vessel Cost | |||
Property Plant And Equipment [Line Items] | |||
Balance beginning of period | 376,193,456 | 351,611,923 | |
Newbuilding deliveries | 81,051,077 | 24,581,533 | |
Balance end of period | 457,244,533 | 376,193,456 | |
Accumulated Depreciation | |||
Property Plant And Equipment [Line Items] | |||
Balance beginning of period | -70,057,540 | -53,235,483 | |
Depreciation for the period | -18,154,020 | -16,822,057 | |
Balance end of period | -88,211,560 | -70,057,540 | |
Net Book Value | |||
Property Plant And Equipment [Line Items] | |||
Balance beginning of period | 306,135,916 | 298,376,440 | |
Newbuilding deliveries | 81,051,077 | 24,581,533 | |
Depreciation for the period | -18,154,020 | -16,822,057 | |
Balance end of period | $369,032,973 | $306,135,916 |
Other_Assets_Table_Details
Other Assets (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Other Assets [Abstract] | |||
Balance at beginning of period | $2,297,121 | $2,596,029 | |
Additions | 4,172,546 | 642,825 | |
Amortization | -2,108,716 | -941,733 | -447,573 |
Balance at end of period | $4,360,951 | $2,297,121 | $2,596,029 |
Other_Assets_Details
Other Assets (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Other Assets [Abstract] | ||
Other assets (non current) | $4,367,134 | $2,303,304 |
Utility deposits | $6,183 | $6,183 |
Investment_in_Affiliate_Table_
Investment in Affiliate (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Investment in Affiliate [Abstract] | |||
Balance beginning of period | $11,309,375 | $19,987,743 | |
Equity in net income of affiliate | 471,079 | 1,652,339 | 1,986,590 |
Equity in other comprehensive income of affiliate | 16,139 | 77,165 | -107,083 |
Dividends received | -1,787,500 | ||
Dilution effect | -221,679 | -390,821 | |
Impairment in investment in affiliate | -8,618,664 | -8,229,551 | |
Balance end of period | $2,956,250 | $11,309,375 | $19,987,743 |
Investment_in_Affiliate_Income
Investment in Affiliate - Income Statement Data (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Statement Data [Line Items] | |||
Net revenue | $54,763,678 | $56,256,756 | $50,300,679 |
Operating income | -33,831,017 | -2,954,345 | 2,293,932 |
Net income | -51,796,181 | -16,953,032 | -17,557,125 |
Box Ships Inc. | |||
Income Statement Data [Line Items] | |||
Net revenue | 49,864,674 | 69,836,201 | |
Operating income | 1,966,947 | 23,631,192 | |
Net income | $2,623,515 | $15,307,658 |
Investment_in_Affiliate_Balanc
Investment in Affiliate - Balance Sheet Data (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Balance Sheet Data [Line Items] | ||
Total current assets | $26,688,017 | $44,220,084 |
Total assets | 460,965,117 | 419,545,980 |
Total current liabilities | 28,482,791 | 23,655,911 |
Total long-term liabilities | 210,081,783 | 163,239,292 |
Box Ships Inc. | ||
Balance Sheet Data [Line Items] | ||
Total current assets | 22,011,255 | 31,691,262 |
Total non-current assets | 375,837,950 | 397,915,376 |
Total assets | 397,849,205 | 429,606,638 |
Total current liabilities | 140,886,944 | 184,434,021 |
Total long-term liabilities | $282,375 | $453,248 |
Investment_in_Affiliate_Detail
Investment in Affiliate (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Investments In And Advances To Affiliates [Line Items] | |||
Number of shares in affiliate held by the Company | 3,437,500 | 3,437,500 | |
Loss on investment in affiliate | $8,840,343 | $8,620,372 | $16,985,066 |
Box Ships Inc. | |||
Investments In And Advances To Affiliates [Line Items] | |||
Percentage of ownership in Box Ships | 11.00% | 13.60% | |
Loss on investment in affiliate | $8,840,343 | $8,620,372 |
LongTerm_Debt_Debt_Agreements_
Long-Term Debt - Debt Agreements (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Debt Instrument [Line Items] | ||
Total long-term debt | $230,778,738 | $180,114,926 |
(a) Commerzbank AG (August 12, 2011) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 43,375,000 | 47,550,000 |
(b) Unicredit Bank AG (November 19, 2007) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 14,606,500 | 22,587,000 |
(c) Bank of Scotland Plc (December 4, 2007) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 0 | 33,616,864 |
(d) Bank of Ireland (March 30, 2009) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 8,350,000 | 13,400,000 |
(e-1) HSH Nordbank AG (July 31, 2008) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 0 | 20,625,000 |
(e-2) HSH Nordbank AG (April 4, 2014) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 46,713,600 | 0 |
(f) HSBC Bank Plc (July 2, 2010) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 14,460,000 | 16,800,000 |
(g-1) Nordea Bank Finland Plc (May 5, 2011) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 0 | 25,536,062 |
(g-2) Nordea Bank Finland Plc (May 6, 2014) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 78,273,638 | 0 |
(h) Senior unsecured notes due 2021 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $25,000,000 | $0 |
LongTerm_Debt_Disclosed_in_the
Long-Term Debt - Disclosed in the Consolidated Balance Sheets (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Long-Term Debt [Abstract] | ||
Current portion of long-term debt | $20,714,324 | $17,257,750 |
Long-term debt | 210,064,414 | 162,857,176 |
Total | $230,778,738 | $180,114,926 |
LongTerm_Debt_Principal_Paymen
Long-Term Debt - Principal Payments (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Long-Term Debt [Abstract] | ||
2015 | $20,714,324 | |
2016 | 32,226,824 | |
2017 | 48,317,324 | |
2018 | 11,642,324 | |
2019 | 11,642,324 | |
Thereafter | 106,235,618 | |
Total | $230,778,738 | $180,114,926 |
LongTerm_Debt_Description_Deta
Long-Term Debt - Description (Details) (USD $) | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 7 Months Ended | |||||||
Sep. 27, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jul. 07, 2014 | Oct. 15, 2014 | Apr. 09, 2014 | Dec. 31, 2014 | Jan. 07, 2014 | Jun. 10, 2014 | Aug. 08, 2014 | Sep. 30, 2014 | Apr. 04, 2014 | Apr. 10, 2014 | 6-May-14 | |
Debt Instrument [Line Items] | |||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Outstanding balance | $230,778,738 | $180,114,926 | $230,778,738 | ||||||||||||
Proceeds from long-term debt | 179,144,427 | 0 | 28,908,750 | ||||||||||||
Debt underwriting discounts and commissions | 2,070,000 | ||||||||||||||
Trading symbol | PRGN | ||||||||||||||
(a) Commerzbank AG (August 12, 2011) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On April 1, 2015, the Company agreed with Commerzbank AG (“Commerzbank”) to amend certain terms of the facility, including the deferral of a portion of its four scheduled quarterly installments due in 2015, and the waiver of the application of the financial and security cover ratio covenants contained in the facility, effective from December 31, 2014 until December 31, 2015. The Company also agreed to a $3,000,000 partial prepayment, a portion of which was prepaid in the first quarter of 2015, while the balance is payable upon signing the final documentation. | ||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Margin | 3.00% | ||||||||||||||
Outstanding balance | 43,375,000 | 47,550,000 | 43,375,000 | ||||||||||||
Debt instrument payment terms | Excluding the agreement dated April 1, 2015 discussed above, the outstanding loan amount as of December 31, 2014 of $43,375,000 was required to be repaid in 11 consecutive quarterly installments of $1,425,000, plus a balloon repayment of $27,700,000 payable simultaneously with the final installment in the third quarter of 2017. | ||||||||||||||
Following the agreement dated April 1, 2015, and after giving effect to the $3,000,000 partial prepayment discussed above, the outstanding loan amount of $40,375,000 is required to be repaid in 4 consecutive quarterly installments of $712,500, followed by 7 consecutive quarterly installments of $1,425,000, plus a balloon repayment of $27,550,000 payable simultaneously with the final installment in the third quarter of 2017. | |||||||||||||||
(b) Unicredit Bank AG (November 19, 2007) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On September 13, 2013, the Company agreed with Unicredit Bank AG (“Unicredit”) to extend the expiration date of the existing waiver relating to the financial covenant of total liabilities to EBITDA ratio for two quarters, from January 1, 2014 to July 1, 2014, for a nominal fee and an advance payment of $1,500,000 to partially prepay the upcoming three quarterly loan installments, starting with the installment due in the fourth quarter of 2013. The advance payment of $1,500,000 was paid on September 13, 2013. On January 20, 2014, the Company agreed with Unicredit to extend the existing waiver relating to the financial covenant of total liabilities to EBITDA ratio until January 1, 2015. On July 30, 2014, the Company agreed with Unicredit, subject to certain closing conditions including a $7,000,000 prepayment, to eliminate the financial covenants relating to the minimum debt service coverage ratio, the minimum market value adjusted net worth and the maximum leverage ratio until the maturity of the loan. In addition, the Company also agreed to increase the required ratio of the fair market value of mortgaged vessels to outstanding loan from 110% to 130% at all times. The Company prepaid the amount of $7,000,000 on September 30, 2014, which was applied against a pro-rate reduction of the remaining installments, excluding the balloon repayment. Furthermore, on March 27, 2015, the Company entered into a loan supplemental agreement and agreed to amended terms with Unicredit, including the deferral of one and a portion of five of its scheduled quarterly installments due in the second quarter of 2015 through the third quarter of 2016, and the waiver of the minimum liquid assets requirement and the security ratio covenant until the maturity of the loan. | ||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Margin | 2.75% | ||||||||||||||
Outstanding balance | 14,606,500 | 22,587,000 | 14,606,500 | ||||||||||||
Debt instrument payment terms | Excluding the supplemental agreement dated March 27, 2015 discussed above, the outstanding loan amount as of December 31, 2014 of $14,606,500 is required to be repaid in 7 consecutive quarterly installments of $480,500, plus a balloon repayment of $11,243,000 payable simultaneously with the final installment in the third quarter of 2016. | ||||||||||||||
Following the supplemental agreement dated March 27, 2015 discussed above, the outstanding loan amount as of December 31, 2014 of $14,606,500 is required to be repaid in 1 quarterly installment of $480,500 in the first quarter of 2015, while no installment is due in the second quarter of 2015, followed by 5 consecutive quarterly installments of $240,250, plus a balloon repayment of $12,924,750 payable simultaneously with the final installment in the third quarter of 2016. | |||||||||||||||
Prepayment amount | 7,000,000 | ||||||||||||||
(c) Bank of Scotland Plc (December 4, 2007) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On June 10, 2014, the Company completed the refinancing of the M/V Coral Seas and the M/V Golden Seas as discussed below, and repaid in full the then outstanding indebtedness under its existing loan agreement with Bank of Scotland Plc dated December 4, 2007. | ||||||||||||||
Outstanding balance | 0 | 33,616,864 | 0 | ||||||||||||
(d) Bank of Ireland (March 30, 2009) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On July 25, 2014, the Company agreed with Bank of Ireland to eliminate the financial covenant relating to the minimum debt service coverage ratio until the maturity of the loan. In addition, on September 30, 2014, the Company proceeded with a prepayment of $4,000,000 with respect to its loan agreement with Bank of Ireland in return for a reduction in the next eight quarterly installments and an increase in the balloon at maturity. In addition, on March 27, 2015, the Company agreed with Bank of Ireland to waive 50% of the installment due in the first quarter of 2015, until April 30, 2015. | ||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Margin | 2.50% | ||||||||||||||
Outstanding balance | 8,350,000 | 13,400,000 | 8,350,000 | ||||||||||||
Debt instrument payment terms | The outstanding loan amount as of December 31, 2014, of $8,350,000 is required to be repaid in 3 consecutive quarterly installments of $350,000, followed by 4 consecutive quarterly installments of $400,000, followed by 3 consecutive quarterly installments of $1,000,000, plus a balloon repayment of $2,700,000 payable simultaneously with the final installment in the second quarter of 2017. | ||||||||||||||
Prepayment amount | 4,000,000 | ||||||||||||||
(e-1) HSH Nordbank AG (July 31, 2008) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On July 7, 2014, the Company completed the refinancing of the M/V Friendly Seas as discussed below, and repaid in full the then outstanding indebtedness under its existing loan agreement with HSH Nordbank AG (“HSH”) dated July 31, 2008. | ||||||||||||||
Outstanding balance | 0 | 20,625,000 | 0 | ||||||||||||
(e-2) HSH Nordbank AG (April 4, 2014) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On April 4, 2014, the Company completed the documentation for a new loan agreement with HSH for a $47,000,000 secured loan facility for the refinancing of the M/V Friendly Seas and the partial financing of the first two Ultramax newbuilding drybulk carriers, the Hull numbers DY152 and DY153. For M/V Friendly Seas, HSH agreed to finance the lower of $12,600,000 or 60% of the vessel’s market value upon the respective drawdown date. For each of the two Ultramax vessels, HSH agreed to finance the lower of $17,200,000 or 65% of the vessels’ market value upon their delivery. On July 7, 2014, the Company completed the refinancing of the M/V Friendly Seas. The Company drew a total amount of $12,600,000 and repaid in full the then outstanding indebtedness under its existing loan agreement with HSH (dated July 31, 2008). In addition, in October 2014, the Company took delivery of its first two Ultramax drybulk carriers; the M/V Gentle Seas and the M/V Peaceful Seas (Hull numbers DY152 and DY153). The Company drew a total amount of $34,400,000, which was used for the payment of the final installment of the two vessels to the shipyard (refer to Note 5). | ||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Margin | 3.25% | ||||||||||||||
Outstanding balance | 46,713,600 | 0 | 46,713,600 | ||||||||||||
Debt instrument payment terms | The outstanding loan amount as of December 31, 2014, of $46,713,600 consists of the following: (i) $12,313,600 relating to the M/V Friendly Seas, which is required to be repaid in 26 consecutive quarterly installments of $286,400, plus a balloon repayment of $4,867,200 payable simultaneously with the final installment in the second quarter of 2021, and (ii) $34,400,000 relating to the M/V Gentle Seas and the M/V Peaceful Seas, which is required to be repaid in 28 consecutive quarterly installments of $506,000, plus a balloon repayment of $20,232,000 payable simultaneously with the final installment in the fourth quarter of 2021. | ||||||||||||||
Amount available for drawdown | 47,000,000 | ||||||||||||||
Proceeds from long-term debt | 12,600,000 | 34,400,000 | |||||||||||||
(f) HSBC Bank Plc (July 2, 2010) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On April 8, 2014, the Company signed a supplemental agreement with HSBC Bank Plc (“HSBC”) and agreed to amend the definitions of certain financial covenants, to prepay an amount of $800,000 that was prepaid on April 10, 2014, and to reduce the outstanding scheduled quarterly installments from $400,000 to $380,000, commencing from the second quarter of 2014. In addition, on August 1, 2014, the Company agreed with HSBC to extend the existing waivers for the financial covenants relating to the minimum interest and debt service coverage ratios, from June 30, 2014 to December 31, 2015. | ||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Margin | 3.00% | ||||||||||||||
Outstanding balance | 14,460,000 | 16,800,000 | 14,460,000 | ||||||||||||
Debt instrument payment terms | The outstanding loan amount as of December 31, 2014, of $14,460,000 is required to be repaid in 23 consecutive quarterly installments of $380,000, plus a balloon repayment of $5,720,000 payable simultaneously with the final installment in the third quarter of 2020. | ||||||||||||||
Prepayment amount | 800,000 | ||||||||||||||
Quarterly periodic payments | 400,000 | 380,000 | |||||||||||||
(g-1) Nordea Bank Finland Plc (May 5, 2011) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On January 7, 2014, we took delivery of our fourth Handysize drybulk vessel; the M/V Proud Seas (refer to Notes 5 and 6). Upon the delivery of the vessel, we drew the total amount of the then undrawn portion of the facility of $25,394,427, by mortgaging both the M/V Priceless Seas and the M/V Proud Seas. On June 10, 2014, the Company completed the refinancing of the M/V Prosperous Seas, the M/V Precious Seas, the M/V Priceless Seas and the M/V Proud Seas as discussed below, and repaid in full the then outstanding indebtedness under its existing syndicated loan facility led by Nordea Bank Finland Plc ("Nordea") dated May 5, 2011. | ||||||||||||||
Outstanding balance | 0 | 25,536,062 | 0 | ||||||||||||
Proceeds from long-term debt | 25,394,427 | ||||||||||||||
(g-2) Nordea Bank Finland Plc (May 6, 2014) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Introductory loan and credit facility information | On May 6, 2014, the Company completed the documentation for a senior secured loan facility with a syndicate of major European banks led by Nordea in an amount of $160,000,000. This facility will be used for the refinancing of six vessels of its operating fleet (the four Handysize vessels M/V Prosperous Seas, M/V Precious Seas, M/V Priceless Seas and the M/V Proud Seas, and the Panamax vessels M/V Coral Seas and M/V Golden Seas), along with the financing of up to 60% of the market value of the remaining two Ultramax newbuilding drybulk carriers, the Hull numbers DY4050 and DY4052, and two of its Kamsarmax newbuilding drybulk carriers, the Hull numbers YZJ1144 and YZJ1145, that are expected to be delivered between the second and fourth quarter of 2015. On June 10, 2014, the Company completed the refinancing of the six vessels of its operating fleet discussed above. The Company drew a total amount of $81,750,000 and repaid in full the then outstanding indebtedness under its existing loan agreements with Bank of Scotland Plc (dated December 4, 2007) and Nordea (dated May 5, 2011). Such refinancing resulted in the write off of the unamortized financing costs of the respective facilities of $1,027,694, which is included in Interest and finance costs in the accompanying consolidated statement of comprehensive loss for the year ended December 31, 2014. | ||||||||||||||
Debt variable rate basis | LIBOR | ||||||||||||||
Margin | 3.20% | ||||||||||||||
Outstanding balance | 78,273,638 | 0 | 78,273,638 | ||||||||||||
Debt instrument payment terms | The outstanding loan amount as of December 31, 2014, of $78,273,638 is required to be repaid in 22 consecutive quarterly installments of $1,738,181, plus a balloon repayment of $40,033,656 payable simultaneously with the final installment in the second quarter of 2020. | ||||||||||||||
Amount available for drawdown | 160,000,000 | ||||||||||||||
Proceeds from long-term debt | 81,750,000 | ||||||||||||||
Bank of Scotland (December 4, 2007) and Nordea (May 5, 2011) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Write off of unamortized financing costs | 1,027,694 | ||||||||||||||
(h) Senior unsecured notes due 2021 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Outstanding balance | 25,000,000 | 0 | 25,000,000 | ||||||||||||
Terms and conditions of debt | On August 8, 2014, the Company completed the offering of 1,000,000 senior unsecured notes due 2021 (“Notes”), pursuant to its effective shelf registration statement. The Notes were issued in minimum denominations of $25.00 and integral multiples of $25.00 in excess thereof, and bear interest at a rate of 8.375% per year, payable quarterly on each February 15, May 15, August 15 and November 15, commencing on November 15, 2014. The Notes will mature on August 15, 2021, and may be redeemed in whole or in part at any time or from time to time after August 15, 2017. The net proceeds from the offering amounted to $23,856,583, net of underwriting discounts and commissions of $812,500, and offering expenses payable by the Company of $330,917. The Notes trade on NASDAQ under the symbol “PRGNL”. | ||||||||||||||
Interest rate per year | 8.38% | 8.38% | |||||||||||||
Debt maturity date | 15-Aug-21 | ||||||||||||||
Net proceeds from issuance of debt | 23,856,583 | ||||||||||||||
Debt underwriting discounts and commissions | 812,500 | ||||||||||||||
Other offering costs | 330,917 | ||||||||||||||
Trading symbol | PRGNL | ||||||||||||||
China Development Bank (May 17, 2013) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Write off of unamortized financing costs | $483,054 | ||||||||||||||
Spread 2 | (a) Commerzbank AG (August 12, 2011) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Margin | 4.50% | ||||||||||||||
Spread 2 | (b) Unicredit Bank AG (November 19, 2007) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Margin | 5.00% |
LongTerm_Debt_Terms_and_Covena
Long-Term Debt - Terms and Covenants (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Debt Instrument [Line Items] | |
Covenant Compliance | As of December 31, 2014, the Company was in compliance with all debt covenants with respect to its debt agreements, with the exception of the security cover ratio covenant contained in the facility with Commerzbank. The respective breach was subsequently cured as in April 2015, the Company agreed with Commerzbank to waive the application of the security cover ratio covenant contained in the facility effective from December 31, 2014 until December 31, 2015 as discussed above. |
Given the current drybulk charter rates, it is probable that the Company will not be in compliance with the minimum working capital requirement and the minimum liquidity requirement contained in certain of its loan and credit facilities on the applicable measurement dates in 2015. Furthermore, based on the Company’s cash flow projections for 2015, cash on hand and cash provided by operating activities will not be sufficient to cover scheduled debt repayments due in 2015. The Company is currently in negotiations with such lenders to obtain waivers for the affected covenants. The Company is also exploring several alternatives aiming to manage its working capital requirements and other commitments if current drybulk charter rates remain at today’s low levels including negotiations for the restructuring of its loans. | |
(a) Commerzbank AG (August 12, 2011) | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | • The ratio of EBITDA to net interest expenses is waived until December 31, 2015, and thereafter shall not be less than 3.00:1.00. |
• The market value adjusted net worth of the Company is waived until December 31, 2015, and thereafter shall not be less than $100,000,000. | |
• Maintain liquid assets requirement is waived until December 31, 2015, and thereafter shall equal an amount of no less than $650,000 per vessel at all times. | |
• The ratio of maximum net debt to total assets expressed as a percentage is waived until December 31, 2015, and thereafter shall not exceed 80%. | |
• The aggregate fair market value of the mortgaged vessels to outstanding loan ratio is waived until December 31, 2015, and thereafter shall exceed 120%. | |
(b) Unicredit Bank AG (November 19, 2007) | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | The financial and security cover ratio covenants contained in the facility have been permanently waived until the maturity of the loan, pursuant to the supplemental agreement dated March 27, 2015. |
(d) Bank of Ireland (March 30, 2009) | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | • The minimum requirement of market value adjusted net worth of the Company is waived until December 31, 2014 and thereafter, shall not be less than $50,000,000. |
• The leverage ratio is waived until December 31, 2014 and thereafter, shall not be greater than 0.80:1.00. | |
• Minimum liquid assets requirement is waived until December 31, 2014 and thereafter, the Company shall maintain liquid assets in an amount of no less than $500,000 per vessel at all times. | |
• The fair market value of the mortgaged vessel to outstanding loan ratio is waived until December 31, 2014 and thereafter, shall exceed 110%. | |
(e-2) HSH Nordbank AG (April 4, 2014) | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | • The aggregate fair market value of the mortgaged vessels to outstanding loan ratio shall exceed 125%. |
(f) HSBC Bank Plc (July 2, 2010) | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | • The ratio of total net debt to EBITDA shall be applicable and not exceed 9.00:1.00 from January 1, 2016 until December 31, 2016 and 8.00:1.00 thereafter. |
• The ratio of EBITDA to interest expense shall be applicable and not be less than 2.50:1.00 from January 1, 2016 until the final maturity of the facility. | |
• The market value adjusted net worth of the Company shall be at least $50,000,000 until December 31, 2013 and $100,000,000 thereafter. | |
• The ratio of total net debt to value adjusted total assets shall be applicable and not greater than 0.80:1.00 from January 1, 2014 until the final maturity of the facility. | |
• The fair market value of the mortgaged vessel to outstanding loan ratio shall exceed 105% until December 31, 2013, 110% until December 31, 2014 and 120% thereafter. | |
(g-2) Nordea Bank Finland Plc (May 6, 2014) | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | • The Company shall maintain a positive working capital at all times, excluding any balloon repayments of long-term loan facilities. |
• There is available to the Company cash and cash equivalents (including restricted but unpledged cash representing minimum liquidity required to be maintained under any financial indebtedness) which are not subject to any security interest, in an amount of not less than the greater of (i) 6% of total financial indebtedness and (ii) $750,000 per vessel owned on the last day of the relevant test period. In the event that the Company pays any dividend or makes any other form of distribution, after the payment of such dividend or the making of such distribution there is available to the Company cash and cash equivalents in an amount of not less than the greater of (i) 8% of total financial indebtedness and (ii) $1,000,000 per vessel owned on the last day of the relevant test period. | |
• The ratio of market value adjusted shareholders’ equity to the market value adjusted total assets shall be equal to or greater than 30%. | |
• The aggregate fair market value of the mortgaged vessels to outstanding loan ratio shall exceed 135%. | |
(h) Senior unsecured notes due 2021 | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | The indenture governing the Notes contains certain restrictive covenants, including limitations on asset sales and: |
• Limitation on Borrowings: Net borrowings not to exceed 70% of total assets. | |
• Limitation on Minimum Net Worth: Net worth to always exceed $100,000,000. | |
Additional Covenants | |
Debt Instrument [Line Items] | |
Covenants (as defined in the respective debt agreement) | Additional Covenants: Each of the above loan and credit facilities are secured by first priority mortgages on all vessels described in Note 1, first assignments of all freights, earnings and insurances. They also contain covenants that require the Company to maintain adequate insurance coverage and to obtain the lender’s consent before it changes the flag, class or management of the vessels, or enter into a new line of business. The facilities include customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation and warranty, a cross-default to other indebtedness and non-compliance with security documents, and prohibits the Company from paying dividends if the Company is in default on its facilities and if, after giving effect to the payment of the dividend, the Company is in breach of a covenant. |
In addition, each of the above loan and credit facilities require a minimum balance of cash and cash equivalents to be maintained at all times with the respective lender, ranging from $400,000 to $750,000 per mortgaged vessel, in excess of any additional cash collateral to be maintained, as defined by the respective loan agreements. | |
Certain of the above loan and credit facilities restrict the amount of dividends the Company may pay to $0.50 per share per annum and limit the amount of quarterly dividends the Company may pay to 100% of its net income for the immediately preceding financial quarter. In addition, under the existing loan and credit facilities, the Company is required to maintain minimum liquidity after payment of dividends equal to the greater of the next six months’ debt service, 8% of total financial indebtedness or $1,000,000 per vessel. Furthermore, according to the supplemental agreement the Company entered into with Unicredit on March 27, 2015 as discussed above, the Company is not permitted to declare or pay any dividends until all the deferred amounts of the facility’s repayment installments have been repaid in full. |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
(g-2) Nordea Bank Finland Plc (May 6, 2014) | |||
Debt Instrument [Line Items] | |||
Credit facility undrawn portion | $78,000,000 | ||
Long-Term Debt - Additional Information | |||
Debt Instrument [Line Items] | |||
Interest and finance costs | 7,451,854 | 6,129,911 | 5,673,906 |
Capitalized interest | $1,618,836 | $786,263 | $611,655 |
Weighted average interest rate | 3.53% | 3.21% | 2.76% |
Interest_Rate_Swaps_Table_Deta
Interest Rate Swaps (Table) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | |||
Derivative [Line Items] | ||||
Notional amount | $56,208,156 | $68,976,781 | ||
Floating rate | LIBOR | |||
Not Qualifying for Hedge Accounting | Unicredit Bank AG | ||||
Derivative [Line Items] | ||||
Effective date | 27-Aug-10 | |||
Termination Date | 27-Aug-15 | |||
Notional amount | 25,500,000 | [1] | 35,700,000 | [1] |
Fixed rate | 2.47% | |||
Floating rate | 3-month LIBOR | |||
Not Qualifying for Hedge Accounting | HSBC Bank Plc | ||||
Derivative [Line Items] | ||||
Effective date | 10-Apr-12 | |||
Termination Date | 10-Apr-17 | |||
Notional amount | 4,560,000 | [2] | 0 | [2] |
Fixed rate | 1.49% | |||
Floating rate | 3-month LIBOR | |||
Not Qualifying for Hedge Accounting | HSH Nordbank AG | ||||
Derivative [Line Items] | ||||
Effective date | 8-May-12 | |||
Termination Date | 5-May-17 | |||
Notional amount | 9,562,500 | [3] | 0 | [3] |
Fixed rate | 1.22% | |||
Floating rate | 3-month LIBOR | |||
Not Qualifying for Hedge Accounting | Nordea Bank Finland Plc | ||||
Derivative [Line Items] | ||||
Effective date | 4-May-12 | |||
Termination Date | 31-Mar-17 | |||
Notional amount | 5,918,792 | [4] | 0 | [4] |
Fixed rate | 1.14% | |||
Floating rate | 3-month LIBOR | |||
Not Qualifying for Hedge Accounting | Nordea Bank Finland Plc | ||||
Derivative [Line Items] | ||||
Effective date | 18-Jun-12 | |||
Termination Date | 4-May-17 | |||
Notional amount | 5,885,615 | [5] | 0 | [5] |
Fixed rate | 1.01% | |||
Floating rate | 3-month LIBOR | |||
Not Qualifying for Hedge Accounting | HSH Nordbank AG | ||||
Derivative [Line Items] | ||||
Effective date | 6-Aug-12 | |||
Termination Date | 5-May-17 | |||
Notional amount | 4,781,250 | [6] | 0 | [6] |
Fixed rate | 0.98% | |||
Floating rate | 3-month LIBOR | |||
Not Qualifying for Hedge Accounting | Total | ||||
Derivative [Line Items] | ||||
Notional amount | 56,208,157 | 35,700,000 | ||
Qualifiying for Hedge Accounting | HSBC Bank Plc | ||||
Derivative [Line Items] | ||||
Effective date | 10-Apr-12 | |||
Termination Date | 10-Apr-17 | |||
Notional amount | 0 | [2] | 5,040,000 | [2] |
Fixed rate | 1.49% | |||
Floating rate | 3-month LIBOR | |||
Qualifiying for Hedge Accounting | HSH Nordbank AG | ||||
Derivative [Line Items] | ||||
Effective date | 8-May-12 | |||
Termination Date | 5-May-17 | |||
Notional amount | 0 | [3] | 10,312,500 | [3] |
Fixed rate | 1.22% | |||
Floating rate | 3-month LIBOR | |||
Qualifiying for Hedge Accounting | Nordea Bank Finland Plc | ||||
Derivative [Line Items] | ||||
Effective date | 4-May-12 | |||
Termination Date | 31-Mar-17 | |||
Notional amount | 0 | [4] | 6,401,958 | [4] |
Fixed rate | 1.14% | |||
Floating rate | 3-month LIBOR | |||
Qualifiying for Hedge Accounting | Nordea Bank Finland Plc | ||||
Derivative [Line Items] | ||||
Effective date | 18-Jun-12 | |||
Termination Date | 4-May-17 | |||
Notional amount | 0 | [5] | 6,366,073 | [5] |
Fixed rate | 1.01% | |||
Floating rate | 3-month LIBOR | |||
Qualifiying for Hedge Accounting | HSH Nordbank AG | ||||
Derivative [Line Items] | ||||
Effective date | 6-Aug-12 | |||
Termination Date | 5-May-17 | |||
Notional amount | 0 | [6] | 5,156,250 | [6] |
Fixed rate | 0.98% | |||
Floating rate | 3-month LIBOR | |||
Qualifiying for Hedge Accounting | Total | ||||
Derivative [Line Items] | ||||
Notional amount | $0 | $33,276,781 | ||
[1] | The notional amount reduces by $2,550,000 on a quarterly basis up until the expiration of the interest rate swap. | |||
[2] | The notional amount reduces by $120,000 on a quarterly basis up until the expiration of the interest rate swap. | |||
[3] | The notional amount reduces by $187,500 on a quarterly basis up until the expiration of the interest rate swap. | |||
[4] | The notional amount reduces by $120,792 on a quarterly basis up until the expiration of the interest rate swap. | |||
[5] | The notional amount reduces by $120,115 on a quarterly basis up until the expiration of the interest rate swap. | |||
[6] | The notional amount reduces by $93,750 on a quarterly basis up until the expiration of the interest rate swap. |
Interest_Rate_Swaps_Details
Interest Rate Swaps (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Interest Rate Swaps [Abstract] | |
Assessment of criteria for hedge accounting | Following the $800,000 prepayment to HSBC and the refinancing of the loan agreements with HSH dated July 31, 2008 and Nordea dated May 5, 2011 as discussed in Note 9, the Company reassessed the criteria for hedge accounting with respect to the corresponding interest rate swaps and concluded that same were no longer met. Accordingly, all the above interest rate swaps did not qualify for hedge accounting as of December 31, 2014. |
Financial_Instruments_and_Fair2
Financial Instruments and Fair Value Disclosures - Balance Sheet Location (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Derivatives designated as hedging instruments | ||
Subtotal | $0 | $229,893 |
Derivatives not designated as hedging instruments | ||
Subtotal | 540,790 | 1,045,393 |
Total derivatives | 540,790 | 1,275,286 |
Non-Current Assets - Interest rate swaps | ||
Derivatives designated as hedging instruments | ||
Interest rate swaps | 0 | -87,295 |
Derivatives not designated as hedging instruments | ||
Interest rate swaps | -66,475 | 0 |
Current liabilities - Interest rate swaps | ||
Derivatives designated as hedging instruments | ||
Interest rate swaps | 0 | 294,505 |
Derivatives not designated as hedging instruments | ||
Interest rate swaps | 589,896 | 685,960 |
Long-Term Liabilities - Interest rate swaps | ||
Derivatives designated as hedging instruments | ||
Interest rate swaps | 0 | 22,683 |
Derivatives not designated as hedging instruments | ||
Interest rate swaps | $17,369 | $359,433 |
Financial_Instruments_and_Fair3
Financial Instruments and Fair Value Disclosures - Effect of Derivative Instruments designated as hedging instruments (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Interest rate swaps | $131,238 | $131,112 | ($847,943) |
Gain Recognized in Accumulated Other Comprehensive Loss - Effective Portion | |||
Interest rate swaps | $131,238 | $131,112 |
Financial_Instruments_and_Fair4
Financial Instruments and Fair Value Disclosures - Derivatives designated as hedging instruments (Table 2) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Interest rate swaps - Realized Loss | ($98,656) | ($312,069) | ($174,869) |
Interest and finance costs (Location of Loss Transferred from Accumulated Other Comprehensive Loss in Statements of Comprehensive Loss - Effective Portion) | |||
Interest rate swaps - Realized Loss | ($98,656) | ($312,069) |
Financial_Instruments_and_Fair5
Financial Instruments and Fair Value Disclosures - Effect of Derivative Instruments not designated as hedging instruments (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Net loss on derivatives | ($387,740) | ($95,288) | ($714,074) |
Loss on derivatives, net | |||
Interest rate swaps - Fair value | 504,602 | 834,829 | |
Interest rate swaps - Realized Loss | ($892,342) | ($930,117) |
Financial_Instruments_and_Fair6
Financial Instruments and Fair Value Disclosures - Measured on a Recurring Basis (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Derivatives Fair Value [Line Items] | ||
Total | $540,790 | $1,275,286 |
Significant Other Observable Inputs (Level 2) | ||
Derivatives Fair Value [Line Items] | ||
Interest rate swaps - asset | -66,475 | -87,295 |
Interest rate swaps - liability | $607,265 | $1,362,581 |
Financial_Instruments_and_Fair7
Financial Instruments and Fair Value Disclosures - Location of Recognized Gain / (Loss) from Marketable Securities (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Marketable securities - Realized Loss | $25,529 | $1,911,212 | $980,430 |
Net gain / (loss) from marketable securities | -25,529 | 1,202,094 | 414,235 |
Gain / (loss) from marketable securities, net | |||
Marketable securities - Initial measurement | 0 | 3,113,306 | |
Marketable securities - Realized Loss | ($25,529) | ($1,911,212) |
Financial_Instruments_and_Fair8
Financial Instruments and Fair Value Disclosures - Summary of Valuation of KLC Shares (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Derivatives Fair Value [Line Items] | ||
KLC Shares - Marketable Securities | $955,535 | $1,616,329 |
Quoted Prices in Active Markets (Level 1) | ||
Derivatives Fair Value [Line Items] | ||
KLC Shares - Marketable Securities | $955,535 | $1,616,329 |
Financial_Instruments_and_Fair9
Financial Instruments and Fair Value Disclosures - Location of Impairment Loss on Investment in Affiliate (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Dilution effect | ($221,679) | ($390,821) | |
Impairment loss | -8,618,664 | -8,229,551 | |
Loss on investment in affiliate | -8,840,343 | -8,620,372 | -16,985,066 |
Loss on investment in affiliate | |||
Dilution effect | -221,679 | -390,821 | |
Impairment loss | ($8,618,664) | ($8,229,551) |
Recovered_Sheet1
Financial Instruments and Fair Value Disclosures - Summary of Valuation in Box Ships (Table) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Derivatives Fair Value [Line Items] | |||
Investment in equity affiliate - Box Ships Inc. | $2,956,250 | $11,309,375 | $19,987,743 |
Quoted Prices in Active Markets (Level 1) | |||
Derivatives Fair Value [Line Items] | |||
Investment in equity affiliate - Box Ships Inc. | $2,956,250 | $11,309,375 |
Recovered_Sheet2
Financial Instruments and Fair Value Disclosures (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 15, 2015 | 9-May-13 | |
Derivative [Line Items] | |||||
Long term bank loans and loan due from related party interest rate basis | LIBOR | ||||
Trading symbol | PRGN | ||||
Fair value of KLC shares | $955,535 | $1,616,329 | |||
Cash received from the sale of KLC shares, net of commissions | 498,056 | 0 | 0 | ||
Unrealized loss on change in fair value of marketable securities | -162,737 | -2,064,265 | -827,377 | ||
Price of Box Ships common share | $1.06 | ||||
Fair value of the investment in Box Ships | 3,643,750 | ||||
Senior unsecured notes due 2021 | |||||
Derivative [Line Items] | |||||
Trading symbol | PRGNL | ||||
Quoted close price of the Company's Notes | $17 | ||||
Debt instrument fair value | 17,000,000 | ||||
KLC Shares | |||||
Derivative [Line Items] | |||||
Total number of KLC shares held by the Company | 44,550 | 65,896 | 26,417 | ||
Number of additional KLC shares received from amended Settlement Agreement with KLC | 58,483 | ||||
Fair value of KLC shares | 955,535 | ||||
Number of KLC shares sold | 21,346 | 18,133 | |||
Average price per share (KLC shares sold) | $23.52 | $22.62 | |||
Cash received from the sale of KLC shares, net of commissions | 498,056 | 406,808 | |||
U.S. dollar / KRW exchange rate | 1,096.92 | ||||
Unrealized loss on change in fair value of marketable securities | $137,208 |
Capital_Structure_Details
Capital Structure (Details) (USD $) | 2 Months Ended | 9 Months Ended | 12 Months Ended | 10 Months Ended | 8 Months Ended | |||||
Feb. 18, 2014 | Sep. 27, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 24, 2012 | Feb. 15, 2013 | 12-May-14 | |
Class of Stock | ||||||||||
Common stock - shares authorized | 755,000,000 | 755,000,000 | ||||||||
Proceeds from issuance of common stock, net of commissions | $39,741,152 | $31,881,984 | $42,235,790 | $34,500,000 | $10,000,000 | |||||
Underwriting discounts and commissions | 2,070,000 | |||||||||
Other offering costs | 548,016 | |||||||||
Preferred stock shares authorized | 25,000,000 | 25,000,000 | 25,000,000 | 25,000,000 | ||||||
Preferred stock par value | $0.00 | $0.00 | $0.00 | $0.00 | ||||||
Preferred stock shares issued | 0 | 0 | 0 | 0 | ||||||
Preferred stock shares outstanding | 0 | 0 | 0 | 0 | ||||||
Common Shares - Class A | ||||||||||
Class of Stock | ||||||||||
Common stock - shares authorized | 750,000,000 | 750,000,000 | 750,000,000 | 750,000,000 | ||||||
Common stock - par value | $0.00 | $0.00 | $0.00 | $0.00 | ||||||
Common stock - shares issued | 24,809,142 | 17,669,442 | 17,669,442 | 24,809,142 | ||||||
Share buyback program - shares repurchased and retired | 30,000 | |||||||||
Common stock - shares outstanding | 24,809,142 | 17,669,442 | 17,669,442 | 24,809,142 | ||||||
Common Shares - Class B | ||||||||||
Class of Stock | ||||||||||
Common stock - shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | 5,000,000 | ||||||
Common stock - par value | $0.00 | $0.00 | $0.00 | $0.00 | ||||||
Common stock - shares issued | 0 | 0 | 0 | 0 | ||||||
Common stock - shares outstanding | 0 | 0 | 0 | 0 | ||||||
Innovation Holdings S.A. | ||||||||||
Class of Stock | ||||||||||
Common stock - shares issued | 4,901,961 | |||||||||
Loretto Finance Inc. | ||||||||||
Class of Stock | ||||||||||
Common stock - shares issued | 135,700 | 120,000 | 469,958 | 469,958 | 98,039 | |||||
Share based compensation | 880,015 | 714,000 | 335,784 | |||||||
Over-Allotment Option | ||||||||||
Class of Stock | ||||||||||
Common stock - shares issued | 885,000 | 782,609 | ||||||||
Share Buyback Program | ||||||||||
Class of Stock | ||||||||||
Share buyback program - authorized amount | $10,000,000 | |||||||||
Share buyback program - shares repurchased and retired | 30,000 | |||||||||
Average price per share (common shares purchased and cancelled) | $5.68 | |||||||||
Public offerings | ||||||||||
Class of Stock | ||||||||||
Common stock - shares issued | 6,785,000 | 6,000,000 | ||||||||
Issue price per share | $6.25 | $5.75 |
Share_Based_Payments_Equity_In2
Share Based Payments - Equity Incentive Plan - October 11, 2006 - Details of Non-vested Share Awards (Table) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total shares granted | 252,000 | |
Grant date fair value | $3.64 | |
Shares cancelled | -3,000 | |
Non-vested share awards | 348,500 | 339,000 |
26-Nov-13 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Final vesting date | 31-Dec-15 | |
Total shares granted | 200,000 | |
Grant date fair value | $5.17 | |
Shares vested | 100,000 | |
Non-vested share awards | 100,000 | |
26-Nov-13 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Final vesting date | 31-Dec-15 | |
Total shares granted | 12,000 | |
Grant date fair value | $5.17 | |
Shares vested | 6,000 | |
Non-vested share awards | 6,000 | |
19-Dec-13 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Final vesting date | 31-Dec-15 | |
Total shares granted | 16,000 | |
Grant date fair value | $6.38 | |
Shares vested | 8,000 | |
Non-vested share awards | 8,000 | |
31-Jan-14 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Final vesting date | 31-Dec-15 | |
Total shares granted | 32,000 | |
Grant date fair value | $6.67 | |
Shares cancelled | 3,000 | |
Shares vested | 14,500 | |
Non-vested share awards | 14,500 | |
Total | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total shares granted | 260,000 | |
Shares cancelled | 3,000 | |
Shares vested | 128,500 | |
Non-vested share awards | 128,500 |
Share_Based_Payments_Equity_In3
Share Based Payments - Equity Incentive Plan - March 26, 2014 - Details of Non-vested Share Awards (Table) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total shares granted | 252,000 | |
Grant date fair value | $3.64 | |
Shares cancelled | -3,000 | |
Non-vested share awards | 348,500 | 339,000 |
10-Dec-14 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Final vesting date | 31-Dec-16 | |
Total shares granted | 200,000 | |
Grant date fair value | $2.44 | |
Non-vested share awards | 200,000 | |
10-Dec-14 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Final vesting date | 31-Dec-16 | |
Total shares granted | 20,000 | |
Grant date fair value | $2.44 | |
Non-vested share awards | 20,000 | |
Total | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total shares granted | 220,000 | |
Non-vested share awards | 220,000 |
Share_Based_Payments_Equity_In4
Share Based Payments - Equity Incentive Plan - Non-vested Share Awards (Table) (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Number of Shares | |
Non-vested, December 31, 2013 | 339,000 |
Granted | 252,000 |
Cancelled | -3,000 |
Vested | -239,500 |
Non-vested, December 31, 2014 | 348,500 |
Weighted Average Fair Value | |
Non-vested, December 31, 2013 | $4.75 |
Granted | $3.64 |
Cancelled | $6.67 |
Vested | $4.63 |
Non-vested, December 31, 2014 | $4.15 |
Share_Based_Payments_Equity_In5
Share Based Payments - Equity Incentive Plan - Non-vested Share Awards (Details) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 26, 2015 | Dec. 31, 2015 | Mar. 17, 2015 | Mar. 26, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of shares reserved for issuance under the plan | 2,000,000 | ||||||
Number of outstanding and exercisable options | 2,800 | 2,800 | |||||
Options exercise price | $120 | $120 | |||||
Weighted average remaining contractual life of the options | 1 year 10 months 21 days | ||||||
Unrecognized cost of unvested share-based compensation awards | $1,189,936 | ||||||
Remaining weighted average period of recognition for unrecognized cost of share-based compensation awards | 1 year 3 months 26 days | ||||||
Shares granted | 252,000 | ||||||
Grant date fair value | $3.64 | ||||||
Share based compensation | $986,416 | $805,469 | $2,536,702 | ||||
Employees | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Shares granted | 70,000 | ||||||
Grant date fair value | $1.87 | ||||||
Vesting period | 2 years | ||||||
Executive officers | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Shares granted | 30,000 | ||||||
Grant date fair value | $1.31 | ||||||
Vesting period | 2 years |
Gain_from_Vessel_Early_Redeliv1
Gain from Vessel Early Redelivery and Other (Income) / Expenses (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Gain from Vessel Early Redelivery and Other (Income) / Expenses [Abstract] | |||
Gain from vessel early redelivery | $0 | $2,267,818 | $0 |
Insurance claim recoveries | 218,634 | 703,422 | |
Cash compensation received by KLC | 402,596 | 29,137 | |
Voluntary special contribution | $250,283 |
Earnings_per_Share_EPS_Table_D
Earnings per Share ("EPS") (Table) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Earnings per Share ("EPS") [Abstract] | |||
Net loss | ($51,796,181) | ($16,953,032) | ($17,557,125) |
Less: Net loss attributable to non-vested share awards | 832,333 | 351,877 | 444,326 |
Net loss attributable to common shareholders | ($50,963,848) | ($16,601,155) | ($17,112,799) |
Denominators | |||
Weighted average common shares outstanding, basic and diluted | 23,326,062 | 12,639,128 | 6,035,910 |
Net loss per common share: | |||
Net loss per common share, basic and diluted | ($2.18) | ($1.31) | ($2.84) |
Earnings_per_Share_EPS_Details
Earnings per Share ("EPS") (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Stock Option | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Anti-dilutive securities | 2,800 | 2,800 | 2,800 |
Non Vested Share Awards | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Anti-dilutive securities | 348,500 | 339,000 | 58,335 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Rental Expense (Table) (Details) (USD $) | Dec. 31, 2014 |
Rental Expense for the year ending | |
31-Dec-15 | $44,508 |
31-Dec-16 | 44,508 |
31-Dec-17 | 33,381 |
Total | $122,397 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Charter Hire (Table) (Details) (USD $) | Dec. 31, 2014 |
Charter Hire for the year ending | |
31-Dec-15 | $4,308,843 |
Total | $4,308,843 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Newbuildings (Table) (Details) (USD $) | Dec. 31, 2014 |
Newbuildings for the year ending | |
31-Dec-15 | $101,700,617 |
Total | $101,700,617 |
Commitments_and_Contingencies_4
Commitments and Contingencies (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Commitments and Contingencies [Abstract] | |
Euro / U.S. dollar exchange rate | 1.214 |
Estimated off-hire time | 18 days |
Subsequent_Events_Details
Subsequent Events (Details) (KLC Shares, USD $) | 0 Months Ended | 12 Months Ended |
Apr. 15, 2015 | Dec. 31, 2014 | |
KLC Shares | ||
Subsequent Event [Line Items] | ||
Number of KLC shares sold | 18,133 | 21,346 |
Average price per share (KLC shares sold) | $22.62 | $23.52 |