TNP Tsakos Energy Navigation Ltd

Selected Consolidated Financial Data and Other Data

The following table presents selected consolidated financial and other data of Tsakos Energy Navigation Limited for each of the five years in the five-year period ended December 31, 2016. The table should be read together with “Item 5. Operating and Financial Review and Prospects.” The selected consolidated financial data of Tsakos Energy Navigation Limited is a summary of, is derived from and is qualified by reference to, our consolidated financial statements and notes thereto which have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”).

Our audited consolidated statements of comprehensive income, other comprehensive income, stockholders’ equity and cash flows for the years ended December 31, 2016, 2015, and 2014, and the consolidated balance sheets at December 31, 2016 and 2015, together with the notes thereto, are included in “Item 18. Financial Statements” and should be read in their entirety.

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Derivation of time charter equivalent per day (amounts in thousands of U.S. dollars except for days and per day amounts):

Capitalization

The following table sets forth our (i) cash and cash equivalents, (ii) restricted cash and (iii) consolidated capitalization as of December 31, 2016 on:

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Other than these adjustments, there has been no material change in our capitalization from debt or equity issuances, re-capitalization or special dividends between December 31, 2016 and April 25, 2017.

This table should be read in conjunction with our consolidated financial statements and the notes thereto, and “Item 5. Operating and Financial Review and Prospects,” included elsewhere in this Annual Report.

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Reasons For the Offer and Use of Proceeds

Not Applicable.

General Market Overview—World Oil Demand / Supply and Trade (Howe Robinson)

All of the statistical data and other information presented in this section entitled “General Market Overview—World Oil Demand / Supply and Trade,” including the analysis of the various sectors of the oil tanker industry, has been provided by Howe Robinson Partners (UK) Ltd (“Howe Robinson”). Howe Robinson has advised that the statistical data and other information contained herein are drawn from its database and other sources. In connection therewith, Howe Robinson has advised that: (a) certain information in Howe Robinson’s database is derived from estimates or subjective judgments; (b) the information in the databases of other maritime data collection agencies may differ from the information in Howe Robinson’s database; and (c) while Howe Robinson has taken reasonable care in the compilation of the statistical and other information and believes it to be accurate and correct, data compilation is subject to limited audit and validation procedures.

Hopes that the low oil price environment of 2015 would translate into a similar earnings trajectory last year dimmed come the second quarter of 2016 as record high product stockpiles restricted refining runs growth and arbitrage trade between regions, limiting both crude and product tanker demand, whilst peak fleet growth towards the end of the year and rising bunker prices also weighed on the tanker market. Overall, year-on-year refining runs grew by only 100,000 bpd in 2016 based on the International Energy Agency’s (IEA) estimates—and although this figure is somewhat skewed from the French refinery strikes that took place in Q2 2016, it is still significantly lower than the +1.83m bpd year-on-year gain global runs had witnessed in 2015. The low refinery demand growth hurt crude tanker demand growth to a degree, but product tanker demand was more seriously impaired by the extremely high product stock levels in all major global refining centres (US Gulf, NW Europe, Singapore) which was the underlying reason that kept runs growth so moderate in the first place. OECD industrial product stocks were 7% higher in 2016 than in 2015 and 14% higher than 2014—contributing to some of the lowest product tanker $/tonne freight rates on record, although tanker earnings level were aided by the relatively low bunkers.

Crude tanker demand in 2016—particularly for VLCCs—was aided by a very strong Chinese stockbuilding activity which exceeded the 1m bpd mark in some periods. This, combined with healthy runs growth in the Far East and heavy crude production growth in the Mideast Gulf (namely from Iran as sanctions were lifted) pushed VLCC loadings to grow by 6.5% YoY—the trade between the Mideast and the Far East became one of the only crude tanker routes to witness growth in 2016. Towards the end of 2016, OPEC and some non-OPEC countries agreed to cut crude output by ~1.76m bpd from October 2016 levels for the first six months of 2017 which would soon reverse the trend set throughout 2016 of concentrating most of the demand growth for crude tankers—and therefore the crude tanker fleet—in the Mideast Gulf. Indeed, following the agreement of this production cut, the oil price began to appreciate, but also the Dubai-Brent and WTI spread narrowed. It has since therefore become increasingly attractive to import crudes priced off Brent or WTI given the production cuts taking effect in the MEG. This is expected to encourage more long-haul crude tanker demand in 2017. Already North American supplies have flowed to the Far East for the first time in recent months. Growing US production should help to widen the WTI-Brent spread further as well and make US crude exports even more attractive for purchase.

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Global Oil Prices and Benchmark Differentials

Crude oil prices had reached a multi-year low in early 2016 with the recovery of Iranian crude exports depressing prices post-sanctions. Iran has boosted production by 840,000 bpd to 3.75m bpd since the end of 2015. Supportive refining margins and outages in West Africa soon boosted oil prices, which had nearly doubled by the start of June, even with the French refinery strikes in late May/early June restricting demand. Burgeoning supply growth from the Mideast Gulf, namely Saudi Arabia and Iran which had risen by 530,000 bpd and 720,000 bpd respectively since the start of the year and waning refinery demand growth amid suffocating product stocks halted the march upwards in oil prices. By mid-June, WTI had begun to once again trade at a discount to Brent amid the declines in West African production pressuring the latter benchmark despite US production at the time still in decline. Oil prices overall weakened further in the third quarter of 2016 during the refinery maintenance season, while OPEC leaders had by then begun to talk of a possible cut to bring oil prices back above $50/bbl for a sustained period of time. This began to excite the market, supporting oil prices speculatively despite growth in US production resuming and stocks in the fourth quarter remaining high. Following the decision of OPEC and 11 non-OPEC countries to reduce output reached on the 30 ^th of November, Brent oil prices have indeed managed to remain above $50/bbl. As mentioned previously, the tightening in Mideast Gulf crude supply, particularly heavy crude supply, has led to a narrowing of the Dubai benchmark relative to other global benchmarks driving Asia to look to source more crude from the North Sea, West Africa, the US, Canada and Brazil.

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Global Oil Supply and Demand

Oil production continued to grow into 2016, rising by ~1.17m bpd in Q1-16 with the return of Iran to the market heightening the growth out of the Mideast Gulf. However, the wildfires in Canada along with a paring back in US supply since their high of just over 13m bpd in Q3-15 saw a growth in global crude supply of only 0.11m bpd YoY in Q2-16. The unrest in Nigeria pushed quarterly production there to at least a 16-year low of 1.25m bpd in Q3-16, whilst more output reductions from other non-OPEC players saw the first quarterly period of implied stockdraw since 2013 albeit at a minimal -0.17m bpd. In Q4-16 the tide was reversed as OPEC members boosted production by almost 0.5m bpd ahead of their agreement to reduce output by 1.2m bpd (and non-OPEC members by a further 558,000 bpd) for the first six-months of 2017. In the nearly 12 months since lifting sanctions, Iran had boosted production by almost 900,000 bpd to average 3.79m bpd for Q4-16. While other major OPEC players, namely Iraq and Saudi Arabia, were also producing at record high levels towards the end of 2016, just ahead of the cuts taking effect. Overall, OPEC production rose by 1.2m bpd year on year while non-OPEC production fell by -0.79m bpd—leaving a supply build of approximately 0.41m bpd.

As mentioned above, Iran returning to the market undoubtedly lead to a big addition of crude supplies into the export market. There were also other OPEC members at play who had an equally heavy hand in the supply build last year. Saudi Arabian supply rose to a record monthly high of 10.65m bpd in July 2016, and for the year its output growth averaged 300,000 bpd or nearly 1m bpd up from 2014 levels. Meanwhile, Iraqi output rose by nearly 700,000 bpd in the full year 2016 to average just above 3m bpd—by the end of 2016 output was much more comfortably in the 3.15m bpd range. Notably, Nigeria took a hit in crude production following a series of militant attacks on infrastructure—monthly Nigerian crude production fell to its lowest in August at 1.37m bpd and was overall down by 300,000 bpd year-on-year. Another OPEC wildcard was Libya, who staged a comeback towards the end of 2016 as production rose to 620,000 bpd from a low of 280,000 bpd in August. The final OPEC member to take note of is Venezuela, whose output slowly receded in 2016 to 2.24m bpd, a year-on-year loss of approximately 200,000 bpd, in light of limited financing, due to low oil prices, needed to support infrastructure for their heavy crude production. With the change of the year into 2017, however, the trajectory for OPEC production has made a swift change with an above 100% compliance so far to the six-month 1.17m bpd cut—overall members have actually cut 1.42m bpd. Saudi Arabia has gone the furthest distance, cutting

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production by 280,000 bpd more than it is required to, marking a production level of just below 10m bpd for the first time since early 2015. As such, the reduction in Mideast Gulf supplies has forced Asian buyers in particular to look further afield to places like the US Gulf or Brazil to fill their growing crude needs, which is promoting more long-haul trade for crude tankers. Meanwhile, OPEC players exempt from the cut, namely Nigeria and Libya, have seen their output rise in recent months but they are unlikely to majorly impair the impact of the deal given the size of the cut.

Conversely, in 2016 non-OPEC crude production sank by almost 800,000 bpd—in stark contrast to their ~2.33m bpd build in 2015 and ~2.52m bpd build in 2014. Leading the charge in the decline was the US where supply was down by 450,000 year-on-year to 12.54m bpd for 2016. However, US supply has since been climbing after hitting their output low in September at 12.2m bpd—output is now back up to 12.48m bpd in January 2017 as the US oil industry has worked over the past couple of years to become a more lean and nimble operation, helping them bounce back quickly at the sign of oil price strength following the announcement of an OPEC deal to cut output towards the end of last year, while the IEA expects US light tight oil production to grow by 500,000 bpd in 2017. Meanwhile, Canadian production was not impaired year-on-year by the wildfires of Q2-16, but Mexican output sank by about 150,000 bpd in 2016 due to a lack of investment in the country. The other large loss in non-OPEC supply in 2016 was Asian production. Chinese crude output, in particular, fell by approximately 200,000 bpd in 2016 which bolstered their crude import needs for the year to the benefit of VLCC tanker demand. Chinese output remains low, at 3.92m bpd in January 2017—400,000 bpd lower than at the end of 2015—this is driven by low oil prices given that the country’s ageing fields have a higher cost of operations. Having said that, the Chinese government has recently expressed a commitment to support the industry and as oil prices continue to climb this loss in Chinese supply should recover over the next couple of years. Although more sparse, growth in non-OPEC supply last year came from Russia (+250,000 bpd) and Brazil (+80,000 bpd) but was not enough to offset the loss in other regions such as North America (overall -520,000 bpd) and Asia (-330,000 bpd) amongst other non-OPEC members. During the first six months of 2017, Russian supply as well as several other non-OPEC member production will be under a lid as they work to adhere to their crude supply cut commitments under the joint OPEC/non-OPEC agreement. So far, Russia has only cut its output by a little more than 100,000 bpd but has announced that it will meet the full 300,000 bpd commitment over the coming months. Overall non-OPEC compliance to the deal is running at about 50%. Although this agreement will stunt non-OPEC growth somewhat in 2017, year-on-year non-OPEC supply is expected to post growth, led by gains in Brazil and a resurgence in the US which already began as output rose by 230,000 bpd in the final quarter of 2016 amid higher oil prices and a more confident financing environment.

OECD industry crude stocks drew by 38.2m bbls in 2016, with most of the draws happening in the second half of the year after reaching a peak in May 2016. OECD European and Asian industry crude stocks both fell, by 30.9m bbls and 12.5m bbls respectively, whilst North American crude stocks have remained stubbornly high and actually slightly grew throughout the year by 5.3m bbls. Even though 2016 witnessed some draws, OECD industry crude stocks remained 125.3m bbls higher at the end of 2016 compared to the same period two years prior. Similarly, it is believed that global crude stocks elsewhere (non-OECD) also remain high—the data to verify this is difficult to come by—and so the global crude market will need to see a prolonged period of undersupply in order for this overhang to be significantly reduced. The OPEC and non-OPEC joint agreement to cut supply is hoped to dent this global crude surplus sitting in storage which will then in turn help to stabilise oil prices at a higher level for a prolonged period.

Overall, in annual terms 2016 was a year where oil demand growth outpaced crude production growth. The IEA consistently upgraded its demand growth estimations throughout the year, citing stronger than expected OECD growth in particular along with what was expected to be stronger demand in the dominating growth markets of India and China. Overall, oil demand grew by 1.6m bpd in 2016—with 0.4m bpd of this growth attributed to OECD countries and the remaining 1.2m bpd as a result of another year of strong non-OECD appetite. Although the IEA recorded slightly stronger oil demand growth in 2016 than expected, it was still far below the year-on-year growth of 2m bpd in 2015—which was in large part driven by the exceptional oil demand growth in Q3-15 which jumped by 2.72m bpd from Q3-14. In comparison, Q3-16 demand was only up by 1.18m

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bpd on the year as the shock of low oil prices, and hence low retail prices for consumer-centric products such as gasoline, had already reverberated through the market. However, without considering the exceptional growth in 2015, an annual growth of 1.6m bpd is still robust and is a testament to the high demand growth environment that has been enabled by low oil prices. Global oil demand is now expected to grow by an average of 1.2m bpd each year to 2022.

In many ways, 2016 was a perfect storm for Chinese crude tanker demand. The year saw a marked decline in domestic Chinese crude production, increased crude demand from independent refiners and an unprecedented stockbuilding appetite. Chinese stockbuilding activity in 2016 is estimated to have averaged 790,000 bpd, compared to 650,000 bpd in 2015. In the first six months of the year, stockbuilding is estimated to have averaged well above 1m bpd—while there were only two monthly stockdraws throughout the year by -80,000 bpd in January and -470,000 bpd in October (figure is implied and not actual). The IEA reports that the Chinese SPR is well into Phase 3, after having filled the last Phase 2 site in Huangdao 2 in the third quarter of 2016. Currently, the 19m bbl Zhoushan 2 and 18.9m bbl Jinzhou SPR are also being filled. However, commercial and refinery-mandated stockbuilding make up a much larger portion of stockbuilding activity than SPR filling, and as such Chinese stockbuilding has proven to be very sensitive to oil price movements yet still highly unpredictably. It is expected that Chinese stockbuilding activity will taper in 2017 as the oil price climbs closer to levels seen in 2015.

Chinese Crude Imports and Stock Building

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Asian oil demand growth in 2016 was the true propeller of the crude tanker market. Chinese oil demand grew by 360,000 bpd, but seaborne import demand grew by more given the decline in domestic production as well as the entry of independent or “teapot” refineries into the market. Independent refiners in China began to receive crude processing quotas and direct crude import quotas in late 2015. Prior to that, these independent refineries used predominantly fuel oil as a feedstock—both imported and domestic. However, since early 2015—shortly after the first independent refineries were awarded quotas—independent refiner demand for imported crude grew from about 300,000 bpd to around 1.3m bpd in January 2017. As it currently stands, a total of 19 independent refiners have received a combined quota for crude oil imports of 917,000 bpd so far this year, lower than their full quotas of 1.475m bpd in 2016, but there are a potential five more independent refiners expected to receive quotas by mid-March whilst a second round of quotas may be awarded towards the end of Q2-17. At first, the independent refiners preferred to source crude in small batches and from short-haul destinations. This saw Russian flows from Kozmino grow as an obvious choice, and the refiners relied on the larger state refiners’ expertise and infrastructure for longer haul crude supplies. In time, the independent refiners have branched out to form their own conglomerates and purchase larger cargoes from long-haul destinations such as West Africa directly while some of the more established independent refiners have even signed term agreements with suppliers in the Mideast Gulf. Indian oil demand growth in 2016 was also noteworthy at 7% or 290,000 bpd. Despite deregulated retail prices, a government-led infrastructure program and an increasing adoption of two-wheel and four-wheel vehicles is propelling growth in the country. However, as a mostly cash-based economy the removal of high denominated bills from circulation towards the end of 2016 is expected to impair oil demand growth, and overall economic growth, in the first few months of 2017.

GDP and Oil Demand Growth vs. Tanker Earnings

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According to the IMF, global GDP growth in 2016 averaged 3.1% for the year. A reduction in inventories and some recovery in manufacturing output saw advanced economies grow at a faster pace than expected, particularly in the United States and some EU countries. Meanwhile, growth in the emerging markets and developing economies was marked by an unexpected slowdown in some countries. Growth in China was stronger than expected, supported by government policies, but annual economic growth in Latin America, notably in countries currently in recession such as Argentina and Brazil, was slower than expected whilst despite continued sanctions activity in Russia growth was better than expected. GDP growth is expected to accelerate to 3.4% in 2017 according to the IMF, with the forecast rising for both advanced economies (from 1.6% in 2016 to 1.9% in 2017) and developing economies (from 4.1% in 2016 to 4.5% in 2017). The IMF also expects world trade volumes to double in 2017 to 3.8% and oil prices (as an average of the Brent, Dubai and WTI benchmarks) to rise by $19.90/bbl.

Crude Tanker Tonne-Miles and Select Crude Imports

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In 2016, the crude trade from the Mideast Gulf to Asia-Pacific experienced an overwhelming growth as Mideast Gulf producers raised production by over 6% or +1.6m bpd whilst Asia-Pacific raised refining runs by +860,000 bpd. VLCCs were the prime benefactor of this growing trade. Overall VLCC liftings were up by 6.54% in 2016 whilst tonne-miles were up by 6%—both were dragged down by lower fuel oil trade volumes and tonne-miles. Conversely, Suezmaxes experienced a nearly flat lifting volumes growth given the disruptions of Nigerian crude loadings and stiffer competition from VLCCs for cargoes out of the Mideast Gulf. However, Suezmax tonne-miles grew by +5.6% in 2016 despite the negligible volumes growth as the traditional WAF/Europe trade was increasingly replaced by longer-haul trades such as MEG/West. Similarly, Aframax volumes growth in 2016 was lacklustre—a slight increase in crude liftings was recorded but offset by a dramatic fall in fuel oil trade, which will continue to be the long-term trend especially given the IMO 2020 0.5% sulphur cap regulation. Aframax trade became more localised as they shouldered competition from Suezmaxes in loading areas such as the Black Sea and the MEG. Aframaxes saw liftings rise in the Baltic and Asia, but overall tonne-miles were lower in 2016 as liftings from traditional key regions including the Med. and long-haul origins like South America fell.

Once again, China was the most significant contributor to tonne-miles growth in 2016—expressed by the growth in VLCC trade from the Mideast Gulf. Interestingly, MEG crude inflows into all the major import areas rose in 2016 as Middle Eastern output ballooned before the agreement to reduce output took hold at the start of 2017 and as output in the west (West Africa, the US, Venezuela) and in importing countries themselves (China, US) fell. As to be expected, West African flows in 2016 faltered—there was a stagnation in imports to China, India and the US from the region whilst there was a marked drop-off in West African crude flows into Europe which was in part due to the disruption in Nigeria but also due to lower European refining runs growth in 2016. Latin American exports only witnessed growth in flows to China, although there was a dip towards the end of the

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year as Venezuelan production began to experience difficulties—Venezuelan crude output fell from 2.34m bpd in Q1-16 to 2.12m bpd in Q4-16. As previously explained, in 2017 there is expected to be a much greater emphasis on tonne-mile growth by virtue of growing long-haul trades as heavy and sour output from the Mideast Gulf, in particular, is clipped back during the first six-months of the year. Already in 2017, we have seen record flows of North Sea, Black Sea and US crude cargoes to the Far East and elsewhere as the differential between Brent and WTI-priced crude grades compared to Dubai-priced crude grades becomes increasingly attractive for long-haul arbitrage opportunities.

US Oil Product Imports and Exports

The product tanker market in 2016 experienced what can be called an underwhelming trade environment. High refining margins that had persisted for the most part since the 2H2014 first left major refining centres with high stocks of middle distillates in 2015, and then—without drawing on those high middle distillate stocks—left major refining centres with high stocks of gasoline in 2016 as well, as refineries maximised their gasoline yield in the chase of more supportive refining margins. Low retail gasoline prices continued into 2016, and so there were expectations that mid-year 2016 could again experience a buoyant gasoline trade—although not to the same extent as in 2015. However, the high product stocks in middle and light distillates built up by early 2016 left the world’s major refining hubs (US Gulf, NW Europe, Singapore) sufficiently supplied to appease local demand peaks and therefore all but eliminated the possibility for pricing signals and arbitrage trades to emerge between regions. This left product trade very depressed for the last three quarters of 2016 in particular, with no great uptick in US product exports or imports given there was a lack of deficit in which to trade.

Refining margins in 2016 were 36% lower year-on-year in NW Europe, 16% lower year-on-year on the US Gulf coast and 41% lower year-on-year in Singapore. Refining margins in the US peaked in Q2-16, whilst margins in NW Europe and Singapore received last-minute strength at the very end of 2016 in lieu of winter weather and a stronger market for some specific fuels at points (including fuel oil in Asia). The drop in refining margins lead to a very low growth in refining runs in 2016 of approximately 120,000 bpd, the lowest since 2009 when global refining runs had fell by -1.5m bpd. Despite the low refining runs growth, OECD industry product

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stocks grew by 69m bbls or over 7% in 2016. Stocks have fallen by 45m bbls since reaching their peak in January 2016, but still remain 61.1m bbls higher than levels as at January 2015. A higher Asian refinery maintenance season, which is expected to peak in early and late Q2-17, and changing fuel specifications in major markets—including China adopting 10ppm fuel standards nationwide—along with naturally lower refining runs in a response to low refining margins is expected to help pull down global product stocks in 2017 and perhaps re-instate healthy and responsive product trade in time.

Product tanker demand was also hit last year by a drop-off in naphtha arbitrage volumes from the west to east, this route is especially critical for LR tanker demand. It is estimated that arb naphtha from the west of Suez into Asia averaged 1.7m bpd in 2015 and fell to an average of 1.3m bpd in 2016 with the second half of 2016 witnessing very low volumes of sub-1m bpd. The collapse in this trade is a result of a few factors, but primarily a cheaper LPG price which led Asian petrochemical plants to switch to LPG from naphtha as their main cracker feedstock. Other reasons include lower surplus naphtha in Europe due to lower refining runs growth last year, in addition to lower gasoline blending component import demand. Overall, this long-haul trade is expected to become increasingly vulnerable to LPG as a competing feedstock for petrochemicals, and as east of Suez becomes more self-sufficient with its own naphtha supplies following the opening of several condensate cracking facilities towards the end of 2016 and start of 2017.

There were few refinery additions last year in comparison to years prior, with most concentrated in the east of Suez region. The much-delayed Paradip refinery started commercial operation of its first 100,000 bpd phase of three in early 2016. The refinery is currently operating at 90% according to its operator IOC but will ramp up to 100% in 2017/18. The refinery is expected to mainly cater to growing domestic demand while new refineries added late in the year in the Mideast Gulf are conversely expected to add to the export market as well. The first 120,000 bpd phase of Iran’s 360,000 bpd Persian Gulf Star refinery was commissioned in Q4-16 and began exporting naphtha cargoes in early 2017, while the 146,000 bpd Ras Laffan 2 refinery launched at the end of 2016 will consume most of the ~50,000 bpd jet fuel output but will export the remainder of product output. Both Mideast Gulf refineries are condensate-fed from domestic sources and so will diminish east of Suez condensate supply. Further east, South Korea’s Hyundai Chemical started up a 110,000 bpd condensate splitter in Daesan in early Q4-16 which immediately drew upon Iranian condensate supplies; South Korea’s purchases of Iranian South Pars condensate rose about 800% year-on-year in 2016 to 69.96m bbls. This draw on Iranian condensate has helped to free up some NITC-owned VLCCs which were acting as supplemental storage anchored off Assaluyeh. Also in the Far East, the 260,000 bpd Yunnan refinery was further delayed as PetroChina had to attain additional certification after increasing the refinery’s capacity without prior environmental approval. The refinery is now complete, but PetroChina is waiting to finalize an agreement with Myanmar officials for the pipeline that runs from the Bay of Bengal and through Myanmar to the southern city of Anning. Finally, the notable closure of 2016 was the 155,000 bpd La Mede refinery which was shut at the end of 2016 to convert the facility into a bio-refinery.

World Tanker Fleet

VLCC fleet growth took off in 2016, peaking at 6.9% after relatively low growth rates in 2015 of 2.8% and in 2014 of 2.4%. Most deliveries into the fleet came at the end of the year, with 20 delivered in the 1H 2016 and 26 delivered in the 2H2016. 2016 marked the highest year for VLCC deliveries into the fleet since 2012, but low scrapping of only 2 VLCCs in 2016 left fleet growth higher for the year. Slippage in 2016 averaged 34.2%, higher than the 2009-2015 slippage average of 27.3%, in lieu of a weaker market. 52 deliveries are currently scheduled for 2017, with 15 already delivered and 37 remaining to be delivered. Slippage in 2017 is expected to remain elevated (although January 2017 alone saw a near-record 12 VLCC deliveries) as the market remains weak in part due to the heavy fleet growth.

Suezmax slippage reached a very high 42% in 2016 as woes in the market during Q3-16 in particular began to dissuade deliveries into 2017, which are scheduled at a total of 61—including 9 that have delivered in the first two months of the year. A total of 25 Suezmaxes were added to the fleet in 2016 while there were zero removals

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from the fleet which amounted to a fleet growth of 5.8%—markedly higher than a fleet growth of 1.4% in 2015 and a slight contraction of -0.2% in 2014. Considering the high slippage in 2016, deliveries into the Suezmax fleet are expected to accelerate as detailed above while slippage is still expected to remain above the seven-year average of 38.3% given still weak market expectations in 2017 and so the NB schedule will be pushed further into 2018.

In 2016, a total of 52 Aframaxes (includes fully coated LR2) were added to the fleet, 35 of which were coated (LR2s). There was an even spread of ships delivered in the first half of the year versus the second half, while the high number of deliveries for the year translated into a relatively low slippage rate of just under 25%—markedly lower than the preceding seven-year average of 31.9%. Overall, Aframax fleet growth grew by 6.0% in 2016 however if we look solely at the LR2 that are actually trading in clean markets that fleet only grow by 3.2% as the high number of dirty ups somewhat offset deliveries into the clean trading fleet. A total of 84 Aframaxes are scheduled to deliver in 2017, including 13 that have already delivered. The coating of these ships can be determined until fairly late in the building process so our count of how many of those are LR2s only includes confirmed coated ships. Of the Aframaxes scheduled to deliver in 2017, 68 are coated which will spell another heavy year of LR2 deliveries which supports the expectation that 2017 will again see more LR2s dirtying up than cleaning up to offset this fleet pressure on the clean trading side.

The Panamax fleet (includes fully coated LR1s) grew by a lower 3.9% rate in 2016 with 18 deliveries, 16 of which were coated, and 2 removals. Slippage in 2017 was 40%, which is actually below the 2009-2015 average of 45.5%, with most deliveries happening in the first half of 2016. Conversely to the clean trading coated Aframax (LR2) fleet, the coated Panamax (LR1) grew by more than the nominal fleet at a rate of 6% as there were more clean ups than dirty ups of the coated capacity which swelled the clean trading fleet on top of the newbuilding deliveries as the LR1 market slightly outpaced dirty Panamax earnings during the year on the whole. Scheduled deliveries for 2017 total 31, all of which are coated LR1s, and only 2 of which have already been delivered in the first two months of 2017. Slippage may creep higher given the continued weak market for both crude and product tanker earnings in 2017 which may see a similar number of ships delivered in 2017 as last year.

A total of 84 vessels entered the MR fleet in 2016, and compared to a scheduled delivery of 96 MRs in 2016 at the start of the year this resulted in a very low slippage rate of 12.5%—significantly below the preceding seven year slippage average for the MR fleet of 30.4%. Only 3 MRs were scrapped in 2016, leaving a net addition of 81 vessels to the fleet or an annual fleet growth rate of 6.3%. Deliveries into the MR fleet will begin to decelerate in 2017, with 70 scheduled for delivery this year followed by 38 in 2018—although there may be still some room to order further. Slippage in 2017 is expected to pick up from the very low levels of last year, but the MR fleet is expected to be protected earnings-wise given the lower fleet growth in the near-term—a marked difference from the LR and crude tanker fleet growth trajectories.

In a similar vein, Handy fleet growth is decelerating with 2016 as the peak fleet growth year—albeit at a low 2.4%—since 2008. Slippage in 2016 for Handies was also quite low, at 15.5% compared to its 2009-2015 average of 28.9%, as 38 newbuilds entered the fleet. There were, however, 18 removals of Handy tankers from the fleet in 2016—with an average age of 27 years—which reduced the net addition to the fleet from 38 to 20. Scheduled deliveries in 2017 total a lower 35, 6 of which have already delivered, while 2018 scheduled deliveries total an even lower 15—although there is scope for some additional orders. Overall, scrapping of the fleet is expected to remain elevated given over 130 Handies are over the age of 20 years and 22 are over the age of 30 years.

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A weaker tanker market, limited financing ability and cases of shipyard distress all lent themselves as factors to depress the S&P tanker activity in 2017. VLCC newbuild prices in South Korea fell by $10m throughout 2016 to finish at $83m, although prices dipped to $82m in September. These lower newbuild prices were not enough to trigger a rush of orders, with a total of 16 VLCCs ordered in 2016—closer to the long-term average but significantly lower than the 54 orders clocked in 2015. The majority of orders came towards the end of the year and were placed in China, Japan and South Korea relatively evenly.

Suezmax orders in 2017 also tracked lower, totalling 18, compared to a staggering 64 orders placed in 2015. There was a rush of 10 orders in October by 4 different owners, while one owner placed an order for 4 coated Suezmaxes—otherwise known as “LR3s”. Suezmax orders were placed mostly in South Korea, with notably a couple placed in Spain. Suezmax NB South Korea prices also lost $10m throughout the year to finish at $55m—equating to an annual loss of 15%, higher than the VLCC annual loss of 11%.

Aframax NB South Korean prices also fell by $10m, or nearly 20%, to $42m by the end of 2016. Total Aframax (coated and uncoated) orders were at just 17 in 2016, compared to 109 in 2015. All figures includes LR2s. Of the 17 Aframaxes ordered in 2016, 8 are known to be coated—more are likely to become coated orders once more information is received closer to delivery. Panamax orders in 2016 were not as strong as the other crude tanker classes, there was 1 uncoated and 30 coated orders last year. In 2017 only 6 Panamaxes, all coated, were ordered as NB South Korean prices fell to $39m by the end of December from $46m at the start of 2016, a 15% fall.

MR NB South Korean prices did not fall by the same degree, weakening by 8.5% or $3m throughout the year to end at $32m. MR orders last year totalled 27, characterised by a number of bulk orders at yards in Japan and China, predominantly. MR ordering had already began a downward trajectory since 2013 when a staggering 165 MR tankers were ordered as part of the eco-MR boom. It is a similar story for the Handies, whose ordering has declined each year since 2013 with 57 orders, 2014 with 47 orders and 2015 with 30 orders. In 2017, there were only 4 Handy orders.

Ordering activity in the medium term is expected to remain subdued as it was in 2016 given the continued expectations of factors that affected the market last year, namely a weaker tanker market and limited financing ability. In periods of high fleet growth, which are preceded by years of high ordering which was witnessed in 2015, 2014 and 2013, ordering interest is typically restrained although orders from especially more institutional players to replace ageing fleets or to address specific national needs will continue to be placed.

Given the weaker market in 2016, there was less demand to procure a ship immediately via the secondhand market. Secondhand (5-year old) tanker prices fell by more than NB prices in all markets, which is not difficult

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to imagine given that secondhand tanker prices jumped in 2015. Throughout the year, VLCC secondhand prices fell by 29.5% to $55m, Suezmax prices fell by 30% to $42m, Aframax prices fell by 38.5% to $27m, LR1 prices fell by 26.5% to $25m while MR prices fell by 28.5% to $20m. Most of the weakness in the second hand market took hold towards the end of the first half of the year, as most tanker earnings began to exhibit a longer term downturn that was due to a fundamental oversupply and not just a temporary dip in the market. Therefore, as to be expected, demand for tankers to operate in the current market sunk and as such second hand prices so far in 2017 have yet to post any major recovery.

Vessel Earnings

A more oversupplied market and slow, but steadily, climbing bunker prices lead to a year-on-year weakening in earnings across the tanker market in 2016. VLCC (basis TD3 round voyage) earnings fell 37% to average just above $41,000/day for the year, Suezmax (basis TD20 round voyage) earnings fell 42% to just below $25,000/day as an average for the year whilst the Aframax Composite (basis an average of TD7, TD8, TD9, TD11, TD14 and TD17 round voyages) fell by 43% to above $20,000/day. Overall, earnings sunk back to near 2014 levels after an exuberant 2015, but $/tonne rates were lower than in 2014 which highlighted the importance of the low bunker cost—although bunker costs were rising they were still low in historical terms, supporting earnings levels in 2016 whilst the actual freight in $/tonne terms was sometimes at record low levels reflecting the oversupply. This phenomenon was even more apparent in the product tanker market as some routes, notably TC1, reached a record low annual $/tonne, yet annual earnings averaged above the four years between 2010 and 2013 at $16,300/day. The record low $/tonne was witnessed on nearly every product tanker Baltic route, including TC2, TC6, TC14 and TC5, exhibiting that product tankers were under greater pressure than their crude tanker counterparts last year. High product stocks in all global refining centres, as explained previously, was a significant hindrance to trade especially considering that the cost of freight in product trade is a much more critical element in making the arbitrage between regions work than in crude trade. Therefore, the arbitrage-sensitive nature of product tanker freight has the ability to depress freight even more in a poor trade environment given an already oversupplied market.

Oil prices, and as an extension bunker prices, hit their low in mid-January. Rotterdam IFO380 reached $105/tonne, compared to $277.50/tonne at the start of 2015 and $611.50/tonne at the start of 2014. Since the start of 2016, bunker prices have climbed up steadily with the rise in oil prices to average ~$211/tonne for the year of 2016—lower than the 2015 average of ~$265/tonne. Going forward, bunker prices are expected to continue to climb with the oil price trajectory and if $/tonne remains depressed owners could see their earnings come down further as they bear the brunt of costlier fuels. Further, with the rise in oil prices the contango also weakened throughout 2016—the 12 month Brent contango has fallen from above $8/bbl at the start of 2016 to $2/bbl at the end of the year. As a result, storage operations began to unravel freeing up more of the fleet from storage play areas such as the Mideast Gulf and Singapore. The 12m Brent spread has since dipped into negative territory, which signifies backwardation, meaning that the OPEC and non-OPEC joint supply cut is bearing fruit as immediate supply is beginning to appear tighter than supply in the future leading to stockdraws.

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VLCC Time Charter Equivalent Spot Market Earnings

VLCC

The VLCC market began the year in 2016 with a very strong January, averaging over $63,000/day (basis TD3 MEG/Japan round voyage), after an exceptional fourth quarter in 2015 aided by strong Far Eastern demand and extremely low bunker prices. Earnings then began to sink with the onset of the spring refinery maintenance season and the beginning of the influx of newbuilds into the fleet—9 VLCCs delivered in the first quarter of 2016, compared to 21 for the entire year of 2015. Overall, VLCC earnings averaged $56,000/day in Q1-16, lower than each quarter in 2015. Earnings sunk further in the second quarter of the year as the drop-off in Nigerian loadings crowded the Mideast Gulf market with Suezmax competition. Q2-16 VLCC earnings fell to just below $43,000/day, while Q3-16 earnings fell even further to average $20,000/day—the lowest quarterly average since Q3-13. TD3 reached its lowest $/tonne in September of approximately $6.70/bbl in the midst of autumn refinery maintenance and continued problems in West Africa. Earnings finally staged a recovery in the fourth quarter of last year, with TD3 TCEs rising to just below $40,000/day in October, near $50,000/day in November and to almost $60,000/day in December. Despite 13 VLCC deliveries in Q4-16, and 13 prior deliveries in Q3-16, seasonally strong Far Eastern demand, buoyed by Chinese stockbuilding, and a massive push in OPEC crude ahead of the production cut agreement improved the demand/supply balance in the VLCC market at the end of 2016 whilst Nigerian and Libyan supplies were also returning absorbing Suezmax and Aframaxes. VLCC earnings have since sunk in the first quarter of 2017, as is seasonal with the onset of spring refinery maintenance affecting February fixing onwards while a reduction in Mideast Gulf loadings and heavy delivery schedule are also testing the market balance.

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Suezmax Time Charter Equivalent Spot Market Earnings

Suezmax

Suezmax earnings also charted down in 2016 from their high levels of 2015, which averaged over $45,000/day for TD6 (BSea/Med) and over $42,000/day for TD20 (WAF/East). However, Q1-16 earnings remained fairly steady at an average of $35,000/day for TD6 and $33,000/day for TD20. Second quarter earnings sunk lower, which is seasonally typical, to an average of $25,000/day for TD6 and TD20. Towards the end of the second quarter major refinery disruptions in France at first provided support for earnings as it created delays and a supply crunch in the Med. region—a traditional market for Suezmaxes coming from either West Africa or the Mideast Gulf into Europe. This pushed earnings in June up by about $2,500/day month on month. Disruptions in Nigerian loadings began in mid-Q1-16, but did not reach their peak in offline capacity until August when TD20 earnings fell near $6,000/day while TD6 earnings fell to approximately $1,500/day. August marked the lowest $/tonne on record for TD20 at just above $6/tonne whilst TD6 $/tonne sunk for the month below $4/tonne and was the lowest since 2002. The weakness in August which was propelled by a combination of low demand, ahead of autumn Asian refinery maintenance, Nigerian disruptions and a total of 19 Suezmax YTD deliveries into the fleet (compared to a total of 8 for the FY 2015) pushed earnings to average just under $12,000/day on TD6 and $14,000/day on TD20. Earnings staged a recovery in the last quarter of the year with a return of stability in Nigeria and a seasonally stronger demand profile. TD6 earnings recovered to average just below $30,000/day in Q4-16 while TD20 earnings rose to just above $25,000/day. The two benchmark Suezmax routes have since weakened since the start of 2017 as heavy Suezmax slippage in 2016 has left many ships in the orderbook for this year—so far in the first two months of 2017, 9 newbuilding Suezmaxes have delivered—with 52 more scheduled to deliver this year of which more than two-thirds are due in the next four months (although continued high slippage is likely this year).

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Aframax Time Charter Equivalent Spot Market Earnings

Aframax

The Aframax Composite (basis an average of TD7, TD8, TD9, TD11, TD14 and TD17) also weakened in 2016; Composite earnings for the year averaged just above $21,000/day compared to an average of $37,000/day in 2015. The Aframax market was of course affected by the weakness in the larger crude tanker sectors, Suezmaxes took a greater market share in regions such as Kozmino and the Black Sea as their traditional West African market somewhat disintegrated, but the dirty Aframax market is also influenced by the clean LR2 market which in 2016 fell markedly amid a very weak product trade environment and high deliveries of newbuild coated ships which made the fleet younger and more competitive. The Aframax Composite remained relatively healthy in the first quarter of 2016 at $28,500/day, with the cross-Med. market in particular weighing down the sector. The Aframax Composite fell further in the second quarter of the year to average $22,500/day with weakness in the East on TD8 (MEG/Singapore) and TD14 (Indonesia/Australia) dragging down the sector average. Dirty Aframax earnings experienced acute weakness in the third quarter of 2016, similar to VLCCs and Suezmaxes, as earnings halved on all the Aframax Composite routes—TD7 (North Sea/UKC) fell to approximately $15,000/day, TD8 sunk to below $11,000/day, TD11 fell to just above $10,000/day and TD17 (Baltic/UKC) fell to just over $14,000/day. Earnings staged a rebound in the fourth quarter as the Composite average recovered from approximately $12,000/day to over $22,000/day. Despite a marked migration of clean-trading LR2 earnings into the dirty trading fleet as LR2 earnings tracked nearly 50% below Aframax earnings in the fourth quarter, the Aframax market remained elevated during the seasonally stronger period and due to the return of Libya and greater Black Sea volumes via the CPC pipeline, also amid a strong NW European market. Aframax earnings have begun to sink again in the first quarter of 2017, pressure from the continued dirtying up of clean trading LR2s is being felt in the market while competition from the larger crude classes is also a threat as their own supply/demand balance remains unfavourable.

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MR Time Charter Equivalent Spot Market Earnings

MR

The MR Composite (basis an average of TC6, TC7, TC10 and TC2/14) sunk over 40% in 2016, similar to the crude tanker sectors, amid the last of three years of high deliveries into the fleet and much weaker product trade growth. The MR Composite fell only slightly in the first quarter of 2016 compared to the last quarter of 2015, from an average of $19,500/day to just below $18,000/day, as a result of continued strength in each market—both east and west. During the start of 2016, refineries were still pumping at very high levels to capture a healthy gasoline margin. Pricing signals for gasoline in particular were still relatively volatile between regions providing for product trading opportunities. However, come the second quarter of 2016 it became apparent that product stocks were more than enough in each of the main refining hubs, meaning that additional supplies from another region were rarely needed, which quickly depressed product tanker demand and therefore product freight. The MR Composite fell to $14,500/day in Q2-16, a year-on-year fall of 50% or $13,500/day. Earnings were lower on each of the four routes, but particularly the TC2/TC14 triangulation of which gasoline trade into the US is a major component. The MR Composite fell further in Q3-16, which was the strongest quarter in 2015, to $11,000/day and stayed at that level through to the end of the year. During the third quarter of 2016, the TC2 (UKC/USAC) $/tonne fell to approximately $12.50/tonne—the lowest level since 2002—while TC14 sunk to the lowest $/tonne on record (since 2008) to near $11/tonne due to a lack of transatlantic trade as a result of sufficient stocks on either side of the Atlantic and therefore minimal, if any, arbitrage opportunities. Weakness in the MR market was also apparent in the east, although to a less extreme degree, as a boom in Chinese product exports unexpectedly swelled the eastern market and kept excess cargoes searching for the few possible arbitrage opportunities West. The MR Composite has slightly recovered to $12,000/day so far in the first quarter of 2017, it is still expected that product trade weakness will hamper trade this year but a lower fleet growth on MRs, whilst other fleets are growing, along with their handle on niche trades will help to support earnings going forward.

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The LNG Market

LNG supply growth in 2016 was less than what had been expected at the beginning of the year as a result of delays in the start-up and slow build-up of production at some new trains combined with declining output at operating plants. However, demand growth throughout the year was stronger than expected in China, India, the Middle East and Egypt which brought the LNG market into closer balance supporting prices which ended the year close to those in oil-indexed long-term contracts. The improved supply/demand balance of LNG also meant that there were no flows of “distressed” LNG cargoes into Europe, the market of last resort. Two trains at the Sabine Pass plant in Louisiana, the first in the lower -48 states and the first in the ascent of US production capacity to ~65 mtpa over the next five years, were commissioned last year with Latin America as the prime destination for most cargoes in 2016, although some headed to Asia towards the end of the year. In addition, some 27 mtpa of regasification import capacity was added during 2016 including additions in Jamaica and Colombia for the first time. However, Japanese LNG imports continued to fall in 2016, to an estimate 81.6 mtpa from 83.6 mtpa in 2015. This trend is unlikely to change course especially if Japan’s nuclear comeback goes as planned. China demonstrated significant and somewhat unexpected demand growth of 33% to 26mtpa last year, but combined with emerging demand growth in the Middle East and South Asia, it may not be enough to prevent a bearish price environment.

A total of approximately 300 spot fixtures are estimated to have been concluded in 2016, a marked increase from around 190 voyages in 2015. The addition of new LNG supply trains to the market in 2016 helped to erode the overcapacity in the LNG tanker market. However, oversupply continued to plague the market in the first half of the year with LNG freight rates remaining low at around $30,000/day despite new liquefaction trains coming online in Australia (Australia Pacific LNG) and the US (Sabine Pass). Freight improved following increased activity in August where Atlantic basin spot rates were in excess of $40,000/day. On the supply side, only 6 LNG carriers (approximately 1% of the fleet) were ordered last year—further promoting a more balanced market in the future. Overall, however, inflated fleet growth over the past few years has led to a supply glut that is expected to keep rates under pressure until 2018 when a significant expansion of US LNG supply is due to hit the market.

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Risk Factors

Risks Related To Our Industry

The tanker industry is cyclical, resulting in charter rates that can be volatile. Poor charter markets for crude oil carriers and product tankers may adversely affect our future revenues and earnings.

The volatility in charter rates, and in turn our revenue and earnings, is due to the historically cyclical nature of the tanker industry. The typical cycle is partly created by material changes in the number of tankers available in the market resulting primarily from new deliveries to the market less vessels demolished or converted due to technical obsolescence and the number of vessels occupied on long-distance travel or delayed by geopolitical events. The cycle is also impacted by material changes to the supply of and demand for oil due primarily to corrections in the price of oil and to geopolitical factors. As of April 5, 2017, over half of the vessels owned by our subsidiary companies were employed under charters based upon prevailing market rates, and the remaining vessels were employed on time charters which, if not extended, are scheduled to expire on various dates between April 2017 and June 2028. After a strong 2015, tanker charter rates declined significantly in 2016 and, following a mild recovery in the seasonally strong fourth quarter of 2016, further declined in early 2017. If rates are low in the charter market for any significant period in 2017, it will have an adverse effect on our revenues, profitability and cash flows. Declines in prevailing charter rates also affect the value of our vessels, which are correlated to the trends of charter rates, and could affect our ability to comply with our loan covenants.

Disruptions in world financial markets and the resulting governmental action in the United States and in other parts of the world could have a material adverse impact on our results of operations, financial condition, cash flows and share price.

Global financial markets and economic conditions have been disrupted and volatile in recent years and remain subject to significant vulnerabilities, such as the deterioration of fiscal balances and the rapid accumulation of public debt, continued deleveraging in the banking sector and a limited supply of credit. While the global economy may be improving, at different rates in different parts of the world, concerns over debt levels of certain European Union member states and poor liquidity of European banks are expected to lead to continued slow growth in most of Europe in 2017. There can be no assurance that a global recession will not return and tight credit markets will not continue or become more severe.

In addition, the process of the UK to exit the European Union, as well as continued turmoil and hostilities in the Middle East and North Africa or potential hostilities elsewhere in the world, could contribute to volatility in the global financial markets. These circumstances, along with the re-pricing of credit risk and the reduced participation of certain financial institutions from financing of the shipping industry, will likely continue to affect the availability, cost and terms of vessel financing. If financing is not available to us when it is needed, or is available only on unfavorable terms, our business may be adversely affected, with corresponding effects on our profitability, cash flows and ability to pay dividends.

Moreover, as a result of the continuing economic crisis in Greece and the related austerity measures implemented by the Greek government, as well as the capital controls in effect in Greece since mid-2015, our operations may be subjected to new regulations that may require us to incur new or additional compliance or other administrative costs and may require that we pay to the Greek government new taxes or other fees or that dividends we pay be subject to withholding taxes. Furthermore, the commitments by the Greek government to the nations’ creditors and potential shift in its policies may potentially lead to Greece’s exit from the Eurozone, if not satisfied, which could affect our technical and commercial managers’ operations located in Greece.

The tanker industry is highly dependent upon the crude oil and petroleum products industries.

The employment of our subsidiaries’ vessels is driven by the availability of and demand for crude oil and petroleum products, the availability of modern tanker capacity and the scrapping, conversion or loss of older vessels. Historically, the world oil and petroleum markets have been volatile and cyclical as a result of the many conditions and events that affect the supply, price, production and transport of oil, including:

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Despite turbulence in the world economy in recent years, worldwide demand for oil and oil products continues to rise. In the event that this trend falters, the production of and demand for crude oil and petroleum products will again encounter pressure which could lead to a decrease in shipments of these products and consequently this would have an adverse impact on the employment of our vessels and the charter rates that they command. Also, if oil prices remain at uneconomic levels for producers, it may lead to declining output. In particular, the charter rates that we earn from our vessels employed on charters related to market rates, may decline and possibly remain at low levels for a prolonged period of time.

Our operating results are subject to seasonal fluctuations.

The tankers owned by our subsidiary companies operate in markets that have historically exhibited seasonal variations in tanker demand, which may result in variability in our results of operations on a quarter-by-quarter basis. Tanker markets are typically stronger in the winter months as a result of increased oil consumption in the northern hemisphere, but weaker in the summer months as a result of lower oil consumption in the northern hemisphere and refinery maintenance. As a result, revenues generated by the tankers in our fleet have historically been weaker during the fiscal quarters ended June 30 and September 30. However, there may be periods in the northern hemisphere when the expected seasonal strength does not materialize to the extent required to support sustainable profitable rates due to tanker overcapacity.

An increase in the supply of vessels without an increase in demand for such vessels could cause charter rates to decline, which could have a material adverse effect on our revenues and profitability.

Historically, the marine transportation industry has been cyclical. The profitability and asset values of companies in the industry have fluctuated based on certain factors, including changes in the supply and demand of vessels. The supply of vessels generally increases with deliveries of new vessels and decreases with the scrapping of older vessels and/or the removal of vessels from the competitive fleet either for storage purposes or for utilization in offshore projects. The newbuilding order book equaled approximately 11% of the existing world tanker fleet at February 1, 2017, by number of vessels, with a significant amount of these newbuilding vessels scheduled to be delivered in 2017. No assurance can be given that the order book will not increase further in proportion to the existing fleet. If supply increases, and demand does not match that increase, the charter rates for our vessels could decline significantly. In addition, any decline of trade on specific long-haul trade routes will effectively increase available capacity with a detrimental impact on rates. A return to weak charter rates could have a material adverse effect on our revenues and profitability.

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The global tanker industry is highly competitive.

We operate our fleet in a highly competitive market. Our competitors include owners of VLCC, suezmax, aframax, panamax, handymax and handysize tankers, as well as owners in the shuttle tanker and LNG markets, which are other independent tanker companies, as well as national and independent oil companies, some of which have greater financial strength and capital resources than we do. Competition in the tanker industry is intense and depends on price, location, size, age, condition, and the acceptability of the available tankers and their operators to potential charterers.

Acts of piracy on ocean-going vessels, although recently declining in frequency, could still adversely affect our business.

Despite a decline in the frequency of pirate attacks on seagoing vessels in the western part of the Indian Ocean, such attacks remain prevalent off the west coast of Africa and between Malaysia and Indonesia. If piracy attacks result in regions in which our vessels are deployed being characterized by insurers as “war risk” zones, as the Gulf of Aden has been, or Joint War Committee (JWC) “war and strikes” listed areas, premiums payable for such insurance coverage could increase significantly and such insurance coverage may be more difficult to obtain. Crew costs, including those due to employing onboard security guards, could increase in such circumstances. In addition, while we believe the charterer remains liable for charter payments when a vessel is seized by pirates, the charterer may dispute this and withhold charter hire until the vessel is released. A charterer may also claim that a vessel seized by pirates was not “on-hire” for a certain number of days and it is therefore entitled to cancel the charter party, a claim that we would dispute. We may not be adequately insured to cover losses from these incidents, which could have a material adverse effect on us. In addition, hijacking as a result of an act of piracy against our vessels, or an increase in cost, or unavailability of insurance for our vessels, could have a material adverse impact on our business, financial condition, results of operations and cash flows.

Terrorist attacks, international hostilities, economic and trade sanctions and the economic situation in the Eurozone can affect the tanker industry, which could adversely affect our business.

Major oil and gas producing countries in the Middle East have become involved militarily in the widening conflicts in Iraq, Syria and Yemen. Armed conflicts with insurgents and others continue, as well, in Libya, another major oil exporting country. Any of these hostilities could seriously disrupt the production of oil or LNG and endanger their export by vessel or pipeline, which could put our vessels at serious risk and impact our operations and our revenues, expenses, profitability and cash flows in varying ways that we cannot now project with any certainty.

The increasing number of terrorist attacks throughout the world, longer-lasting wars, international incidents such as that between Turkey and Russia or international hostilities, such as in the Ukraine, Afghanistan, Iraq, Syria, Libya and Yemen, could damage the world economy and adversely affect the availability of and demand for crude oil and petroleum products and negatively affect our investment and our customers’ investment decisions over an extended period of time. In addition, sanctions against oil exporting countries such as Iran, Sudan, Syria and Russia may also impact the availability of crude oil which would increase the availability of tankers, thereby negatively impacting charter rates. We conduct our vessel operations internationally and despite undertaking various security measures, our vessels may become subject to terrorist acts and other acts of hostility like piracy, either at port or at sea. Such actions could adversely impact our overall business, financial condition and results of operations. In addition, terrorist acts and regional hostilities around the world in recent years have led to increases in our insurance premium rates and the implementation of special “war risk” premiums for certain trading routes.

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Our charterers may direct one of our vessels to call on ports located in countries that are subject to restrictions imposed by the U.S. government, which could negatively affect the trading price of our common shares.

On charterers’ instructions, our subsidiaries’ vessels may be requested to call on ports located in countries subject to sanctions and embargoes imposed by the U.S. government, the UN or the EU and countries identified by the U.S. government, the UN or the EU as state sponsors of terrorism. The U.S., UN- and EU- sanctions and embargo laws and regulations vary in their application, as they do not all apply to the same covered persons or proscribe the same activities, and such sanctions and embargo laws and regulations may be amended or strengthened over time.

On January 16, 2016, “Implementation Day” for the Iran Joint Comprehensive Plan of Action (JCPOA), the United States lifted its secondary sanctions against Iran which prohibited certain conduct by non-U.S. companies and individuals that occurred entirely outside of U.S. jurisdiction involving specified industry sectors in Iran, including the energy, petrochemical, automotive, financial, banking, mining, shipbuilding and shipping sectors. By lifting the secondary sanctions against Iran, the U.S. government effectively removed U.S. imposed restraints on dealings by non-U.S. companies, such as our Company, and individuals with these formerly targeted Iranian business sectors. Non-U.S. companies continue to be prohibited under U.S. sanctions from (i) knowingly engaging in conduct that seeks to evade U.S. restrictions on transactions or dealings with Iran or that causes the export of goods or services from the United States to Iran, (ii) exporting, reexporting or transferring to Iran any goods, technology, or services originally exported from the U.S. and / or subject to U.S. export jurisdiction and (iii) conducting transactions with the Iranian or Iran-related individuals and entities that remain or are placed in the future on OFAC’s list of Specially Designated Nationals and Blocked Persons (SDN List), notwithstanding the lifting of secondary sanctions. The U.S. has the ability to reimpose sanctions against Iran, including if, in the future, Iran does not comply with its obligations under the nuclear agreement.

The U.S. government’s primary Iran sanctions remain largely unchanged after Implementation Day and, as a consequence, U.S. persons continue to be broadly prohibited from engaging in transactions or dealings in or with Iran or its government. These sanctions broadly restrict U.S. persons from engaging in transactions or dealings with the Government of Iran and Iranian financial institutions, which effectively impacts the transfer of funds to, from, or through the U.S. financial system whether denominated in US dollars or any other currency.

As a result of the lifting of U.S. secondary sanctions (and relevant EU sanctions) relating to Iran, we can anticipate that some of our charterers may direct our vessels to carry cargoes to or from Iran. This could have various effects on us, such as affecting our reputation and our relationships with our investors and financing sources, affecting the cost of our insurance with respect to such voyages, and potentially increase our exposure to foreign currency fluctuations. Investor perception of the value of our shares may also be adversely affected by the consequences of war, the effects of terrorism, civil unrest and governmental actions in these and surrounding countries.

The U.S. also maintains embargoes on Cuba, North Korea, Sudan and Syria. We can anticipate that some of our charterers may request our vessels to call on ports located in these countries. Although we believe that we are in compliance with all applicable sanctions and embargo laws and regulations, and intend to maintain such compliance, there can be no assurance that we will be in compliance in the future, particularly as the scope of certain laws may be unclear and may be subject to changing interpretations. Any such violation could result in fines or other penalties and could result in some investors deciding, or being required, to divest their interest, or not to invest, in us. Additionally, some investors may decide to divest their interest, or not to invest, in us simply because we do business with companies that do lawful business in sanctioned countries. Moreover, our charterers may violate applicable sanctions and embargo laws and regulations as a result of actions that do not involve us or our vessels, and those violations could in turn negatively affect our reputation.

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Failure to comply with the U.S. Foreign Corrupt Practices Act and other anti-bribery legislation in other jurisdictions could result in fines, criminal penalties, contract terminations and an adverse effect on our business.

We may operate in a number of countries throughout the world, including countries known to have a reputation for corruption. We are committed to doing business in accordance with applicable anti-corruption laws and have adopted a code of business conduct and ethics which is consistent and in full compliance with the U.S. Foreign Corrupt Practices Act of 1977, or the “FCPA”. We are subject, however, to the risk that persons and entities whom we engage or their agents may take actions that are determined to be in violation of such anti-corruption laws, including the FCPA. Any such violation could result in substantial fines, sanctions, civil and/or criminal penalties, or curtailment of operations in certain jurisdictions, and might adversely affect our business, results of operations or financial condition. In addition, actual or alleged violations could damage our reputation and ability to do business. Furthermore, detecting, investigating, and resolving actual or alleged violations is expensive and can consume significant time and attention of our senior management.

Efforts to take advantage of opportunities in pursuit of our growth strategy may result in financial or commercial difficulties.

A key strategy of management is to continue to renew and grow the fleet by pursuing the acquisition of additional vessels or fleets or companies that are complementary to our existing operations. If we seek to expand through acquisitions, we face numerous challenges, including:

We cannot assure you that we will be able to integrate successfully the operations, personnel, services or vessels that we might acquire in the future, and our failure to do so could adversely affect our profitability.

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

Our business and the operation of our subsidiaries’ vessels are subject to extensive international, national and local environmental and health and safety laws and regulations in the jurisdictions in which our vessels operate, as well as in the country or countries of their registration. In addition, major oil companies chartering our vessels impose, from time to time, their own environmental and health and safety requirements. To comply with these requirements and regulations, including the new MARPOL Annex VI sulfur emission requirements instituting a global 0.5% sulphur cap on marine fuels from January 1, 2020 and the IMO ballast water management (“BWM”) convention, which requires vessels to install expensive ballast water treatment systems (“BWTS”) before the first MARPOL renewal survey conducted after September 8, 2017 and for all vessels to be certified in accordance with the BWM convention by September 8, 2017, we may be required to incur additional costs to meet new maintenance and inspection requirements, develop contingency plans for potential spills, and obtain insurance coverage

These and future environmental regulations, which may become stricter, may limit our ability to do business, increase our operating costs and/or force the early retirement of our vessels, all of which could have a material adverse effect on our financial condition and results of operations.

International, national and local laws imposing liability for oil spills are also becoming increasingly stringent. Some impose joint, several, and in some cases, unlimited liability on owners, operators and charterers regardless of fault. We could be held liable as an owner, operator or charterer under these laws. In addition, under

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certain circumstances, we could also be held accountable under these laws for the acts or omissions of Tsakos Shipping & Trading S.A. (“Tsakos Shipping”), Tsakos Columbia Shipmanagement Ltd. (“TCM”) or Tsakos Energy Management Limited (“Tsakos Energy Management”), companies that provide technical and commercial management services for our subsidiaries’ vessels and us, or others in the management or operation of our subsidiaries’ vessels. Although we currently maintain, and plan to continue to maintain, for each of our subsidiaries’ vessels’ pollution liability coverage in the amount of $1 billion per incident (the maximum amount available), liability for a catastrophic spill could exceed the insurance coverage we have available, and result in our having to liquidate assets to pay claims. In addition, we may be required to contribute to funds established by regulatory authorities for the compensation of oil pollution damage or provide financial assurances for oil spill liability to regulatory authorities.

Maritime disasters and other operational risks may adversely impact our reputation, financial condition and results of operations.

The operation of ocean-going vessels has an inherent risk of maritime disaster and/or accident, environmental mishaps, cargo and property losses or damage and business interruptions caused by, among others:

Any of these circumstances could adversely affect our operations, result in loss of revenues or increased costs and adversely affect our profitability and our ability to perform our charters.

Our subsidiaries’ vessels could be arrested at the request of third parties.

Under general maritime law in many jurisdictions, crew members, tort claimants, vessel mortgagees, suppliers of goods and services and other claimants may lien a vessel for unsatisfied debts, claims or damages. In many jurisdictions a maritime lien holder may enforce its lien by arresting a vessel through court process. In some jurisdictions, under the extended sister ship theory of liability, a claimant may arrest not only the vessel with respect to which the claimant’s maritime lien has arisen, but also any associated vessel under common ownership or control. While in some jurisdictions which have adopted this doctrine, liability for damages is limited in scope and would only extend to a company and its ship-owning subsidiaries, we cannot assure you that liability for damages caused by some other vessel determined to be under common ownership or control with our subsidiaries’ vessels would not be asserted against us.

Risks Related To Our Business

Any significant future declines in the values of our vessels could affect our ability to comply with various covenants in our credit facilities unless waived or modified by our lenders.

Our credit facilities, which are secured by mortgages on our subsidiaries’ vessels, require us to maintain specified collateral coverage ratios and satisfy financial covenants, including requirements based on the market value of our vessels, such as maximum corporate leverage levels. The appraised value of a ship fluctuates

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depending on a variety of factors including the age of the ship, its hull configuration, prevailing charter market conditions, supply and demand balance for ships and new and pending legislation. The oversupply of tankers and depressed tanker charter market adversely affected tanker values from the middle of 2008 to late 2013, and despite the young age of our subsidiaries’ fleet and extensive long-term charter employment on many of the vessels, resulted in a significant decline in the charter-free values of our vessels. Vessel values recovered from the end of 2013, but have again declined during 2016 due primarily to global fleet overcapacity and lack of financing for potential buyers to acquire second-hand, charter free vessels. Values may remain at current levels for a prolonged period, further decline or rise. Low values may result in our inability to comply with the financial covenants under our credit facilities which relate to our consolidated leverage and -loan-to-asset value collateral requirements. If we were unable to obtain waivers in case of non-compliance, or post additional collateral or prepay principal in the case of loan-to-asset value requirements, our lenders could accelerate our indebtedness. We have paid all of our scheduled loan installments and related loan interest consistently without delay or omission and none of our lenders under our credit facilities has requested such prepayment or additional cash collateral where non compliance has occurred.

Charters at attractive rates may not be available when our current time charters expire.

During 2016, we derived approximately 52% of our revenues from time charters, as compared to 41% in 2015. As our current period charters on thirteen of the vessels owned by our subsidiary companies expire in the remainder of 2017, it may not be possible to re-charter these vessels on a period basis at attractive rates-if the current softness in the tanker charter market continues. If attractive period charter opportunities are not available, we would seek to charter the vessels owned by our subsidiary companies on the spot market, which is subject to significant fluctuations. In the event a vessel owned by one of our subsidiary companies may not find employment at economically viable rates, management may opt to lay up the vessel until such time that rates become attractive again (an action which our subsidiary companies have never undertaken). During the period of any layup, the vessel would continue to incur expenditures such as insurance, reduced crew wages and maintenance costs.

We are dependent on the ability and willingness of our charterers to honor their commitments to us for all of our revenues and the failure of our counterparties to meet their obligations under our charter agreements could cause us to suffer losses or otherwise adversely affect our business.

We derive a substantial portion of our revenues from the payment of charter hire by our charterers. 41 of our 62 vessels are currently employed under time charters including time charters with profit share. We could lose a charterer or the benefits of a time charter if:

If we lose a time charter, we may be unable to re-deploy the related vessel on terms as favorable to us or at all. We would not receive any revenues from such a vessel while it remained unchartered, but we may be required to pay expenses necessary to maintain the vessel in proper operating condition, insure it and service any indebtedness secured by such vessel.

If our charterers fail to meet their obligations to us or attempt to renegotiate our charter agreements, as part of a court-led restructuring or otherwise, we could sustain significant reductions in revenue and earnings which could have a material adverse effect on our business, financial condition, results of operations and cash flows, as well as our ability to pay dividends, if any, in the future, and comply with the covenants in our credit facilities.

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If our exposure to the spot market increases, our revenues could suffer and our expenses could increase.

The spot market for crude oil and petroleum product tankers is highly competitive. During 2016, we modified our chartering strategy to place more of our subsidiaries’ vessels on time-charter. As of April 5, 2017, 21 of the vessels owned by our subsidiary companies were employed under spot charters. If we were to increase participation in the spot market, we may experience a lower overall utilization of our fleet through waiting time or ballast voyages, leading to a decline in operating revenue. Moreover, to the extent our vessels are employed in the spot market, both our revenue from vessels and our operating costs, specifically our voyage expenses, will be significantly impacted by adverse movements in the cost of bunkers (fuel). See “—Fuel prices may adversely affect our profits.” Unlike time charters in which the charterer bears all of the bunker costs, in spot market voyages we bear the bunker charges as part of our voyage costs. As a result, while historical movements in bunker charges are factored into the prospective freight rates for spot market voyages periodically announced by World Scale Association (London) Limited and similar organizations, increases in bunker charges in any given period could have a material adverse effect on our cash flow and results of operations for the period in which the increase occurs. In addition, to the extent we employ our vessels pursuant to contracts of affreightment or under pooling arrangements, the rates that we earn from the charterers under those contracts may be subject to reduction based on market conditions, which could lead to a decline in our operating revenue.

We depend on Tsakos Energy Management, Tsakos Shipping and TCM to manage our business.

We do not have the employee infrastructure to manage our operations and have no physical assets. In common with industry practice, our subsidiaries own the vessels in the fleet and the contracts to construct our newbuildings. We have engaged Tsakos Energy Management to perform all of our executive and management functions. Tsakos Energy Management employees directly provide us with financial, accounting and other back-office services, including acting as our liaison with the New York Stock Exchange and the Bermuda Monetary Authority. Tsakos Energy Management, in turn, oversees and subcontracts part of commercial management (including treasury, chartering and vessel purchase and sale functions) to Tsakos Shipping, and day-to-day fleet technical management, such as vessel operations, repairs, supplies and crewing, to TCM. As a result, we depend upon the continued services provided by Tsakos Energy Management and Tsakos Energy Management depends on the continued services provided by Tsakos Shipping and TCM.

We derive significant benefits from our relationship with Tsakos Energy Management and its affiliated companies, including purchasing discounts to which we otherwise would not have access. We would be materially adversely affected if any of Tsakos Energy Management, Tsakos Shipping or TCM becomes unable or unwilling to continue providing services for our benefit at the level of quality they have provided such services in the past and at comparable costs as they have charged in the past. If we were required to employ a ship management company other than Tsakos Energy Management, we cannot offer any assurances that the terms of such management agreements would be on terms as favorable to the Company in the long term.

Tsakos Energy Management, Tsakos Shipping and TCM are privately held companies and there is little or no publicly available information about them.

The ability of Tsakos Energy Management, Tsakos Shipping and TCM to continue providing services for our and our subsidiaries’ benefit will depend in part on their own financial strength. Circumstances beyond our control could impair their financial strength and, because each of these companies is privately held, it is unlikely that information about their financial strength would become public. Any such problems affecting these organizations could have a material adverse effect on us.

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Tsakos Energy Management has the right to terminate its management agreement with us and Tsakos Shipping and TCM have the right to terminate their respective contracts with Tsakos Energy Management.

Tsakos Energy Management may terminate its management agreement with us at any time upon one year’s notice. In addition, if even one director were to be elected to our board without having been recommended by our existing board, Tsakos Energy Management would have the right to terminate the management agreement on 10 days’ notice. If Tsakos Energy Management terminates the agreement for this reason, we would be obligated to pay Tsakos Energy Management the present discounted value of all payments that would have otherwise become due under the management agreement until June 30 in the tenth year following the date of the termination plus the average of the incentive awards previously paid to Tsakos Energy Management multiplied by 10. A termination as of December 31, 2016 would have resulted in a payment of approximately $166.3 million. Tsakos Energy Management’s contracts with Tsakos Shipping and with TCM may be terminated by either party upon six months’ notice and would terminate automatically upon termination of our management agreement with Tsakos Energy Management.

Our ability to pursue legal remedies against Tsakos Energy Management, Tsakos Shipping and TCM is very limited.

In the event Tsakos Energy Management breaches its management agreement with us, we or our subsidiaries could bring a lawsuit against it. However, because neither we nor they are ourselves party to a contract with Tsakos Shipping or TCM, it may be difficult to sue Tsakos Shipping and TCM for breach of their obligations under their contracts with Tsakos Energy Management, and Tsakos Energy Management may have no incentive to sue Tsakos Shipping and TCM. Tsakos Energy Management is a company with no substantial assets and no income other than the income it derives under the management agreement with us. Therefore, it is unlikely that we or our subsidiaries would be able to obtain any meaningful recovery if we or they were to sue Tsakos Energy Management, Tsakos Shipping or TCM on contractual grounds.

Tsakos Shipping provides chartering services to other tankers and TCM manages other tankers and could experience conflicts of interests in performing obligations owed to us and the operators of other tankers.

In addition to the vessels that it manages for our fleet, TCM technically manages a fleet of privately owned vessels and wishes to acquire third-party clients. These vessels are operated by the same group of TCM employees that manage our vessels, and we are advised that its employees manage these vessels on an “ownership neutral” basis; that is, without regard to who owns them. It is not impossible that Tsakos Shipping, which provides chartering services for nearly all vessels technically managed by TCM, might allocate charter or spot opportunities to other TCM managed vessels when our subsidiaries’ vessels are unemployed. It is also possible that TCM could in the future agree to manage more tankers that might directly compete with the fleet.

Clients of Tsakos Shipping have acquired and may acquire additional vessels that may compete with our fleet.

Tsakos Shipping and we have an arrangement whereby it affords us a right of first refusal on any opportunity to purchase a tanker which is 10 years of age or younger or contract to construct a tanker that is referred to or developed by Tsakos Shipping. Were we to decline any opportunity offered to us, or if we do not have the resources or desire to accept it, other clients of Tsakos Shipping might decide to accept the opportunity. In this context, Tsakos Shipping clients have in the past acquired modern tankers and have ordered the construction of vessels. They may acquire or order tankers in the future, which, if we decline to buy from them, could be entered into charters in competition with our vessels. These charters and future charters of tankers by Tsakos Shipping could result in conflicts of interest between their own interests and their obligations to us.

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Our chief executive officer has affiliations with Tsakos Energy Management, Tsakos Shipping and TCM which could create conflicts of interest.

Nikolas Tsakos is the president, chief executive officer and a director of our company and the director and sole shareholder of Tsakos Energy Management. Nikolas Tsakos is also the son of the founder of Tsakos Shipping. These responsibilities and relationships could create conflicts of interest that could result in our losing revenue or business opportunities or increase our expenses.

Our commercial arrangements with Tsakos Energy Management and Argosy may not always remain on a competitive basis.

We pay Tsakos Energy Management a management fee for its services pursuant to our management agreement. We also place our hull and machinery insurance, increased value insurance and loss of hire insurance through Argosy Insurance Company, Guernsey, a captive insurance company affiliated with Tsakos interests. We believe that the management fees that we pay Tsakos Energy Management compare favorably with management compensation and related costs reported by other publicly traded shipping companies and that our arrangements with Argosy are structured at arm’s-length market rates. Our board reviews publicly available data periodically in order to confirm this. However, we cannot assure you that the fees charged to us are or will continue to be as favorable to us as those we could negotiate with third parties and our board could determine to continue transacting business with Tsakos Energy Management and Argosy even if less expensive alternatives were available from third parties.

We depend on our key personnel.

Our future success depends particularly on the continued service of Nikolas Tsakos, our president and chief executive officer and the sole shareholder of Tsakos Energy Management. The loss of Mr. Tsakos’s services or the services of any of our key personnel could have a material adverse effect on our business. We do not maintain key man life insurance on any of our executive officers.

Because the market value of our vessels may fluctuate significantly, we may incur impairment charges or losses when we sell vessels which may adversely affect our earnings.

The fair market value of tankers may increase or decrease depending on any of the following:

The global economic downturn that commenced in 2008 resulted in a decrease in vessel values. The decrease in value accelerated during 2013 until the latter part of the year as a result of excess fleet capacity and falling freight rates. Although valuations recovered, they have declined again in 2016 and may fall further, remain the same or start to rise again depending on market conditions. In addition, although our subsidiaries currently own a modern fleet, with an average age of 7.4 years as of April 5, 2017, as vessels grow older, they generally decline in value.

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We have a policy of considering the disposal of tankers periodically. If our subsidiaries’ tankers are sold at a time when tanker prices have fallen, the sale may be at less than the vessel’s carrying value on our financial statements, with the result that we will incur a loss.

In addition, accounting pronouncements require that we periodically review long-lived assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. An impairment charge for an asset held for use should be recognized when the estimate of undiscounted cash flows, excluding interest charges, expected to be generated by the use of the asset is less than its carrying amount. Measurement of the impairment charge is based on the fair value of the asset as provided by third parties. Such reviews may from time to time result in asset write-downs, which could adversely affect our results of operations.

If TCM is unable to attract and retain skilled crew members, our reputation and ability to operate safely and efficiently may be harmed.

Our continued success depends in significant part on the continued services of the officers and seamen whom TCM provides to crew the vessels owned by our subsidiary companies. The market for qualified, experienced officers and seamen is extremely competitive and has grown more so in recent periods as a result of the growth in world economies and other employment opportunities. Although TCM has a contract with a number of manning agencies and sponsors various marine academies in the Philippines, Greece and Russia, we cannot assure you that TCM will be successful in its efforts to recruit and retain properly skilled personnel at commercially reasonable salaries. Any failure to do so could adversely affect our ability to operate cost-effectively and our ability to increase the size of the fleet.

Labor interruptions could disrupt our operations.

Substantially all of the seafarers and land based employees of TCM are covered by industry-wide collective bargaining agreements that set basic standards. We cannot assure you that these agreements will prevent labor interruptions. In addition, like many other vessels internationally, some of our subsidiaries’ vessels operate under so-called “flags of convenience” and may be vulnerable to unionization efforts by the International Transport Federation and other similar seafarer organizations which could be disruptive to our operations. Any labor interruption or unionization effort which is disruptive to our operations could harm our financial performance.

The contracts to build our newbuildings present certain economic and other risks.

As of April 5, 2017, our subsidiaries have contracts for the construction of three aframax tankers for delivery in 2017. Our subsidiaries may also order additional newbuildings. During the course of construction of a vessel, we are typically required to make progress payments. While we typically have refund guarantees from banks to cover defaults by the shipyards and our construction contracts would be saleable in the event of our payment default, we can still incur economic losses in the event that we or the shipyards are unable to perform our respective obligations. Shipyards may periodically experience financial difficulties.

Delays in the delivery of these vessels, or any additional newbuilding or secondhand vessels our subsidiaries may agree to acquire, could delay our receipt of revenues generated by these vessels and, to the extent we have arranged charter employment for these vessels, could possibly result in the cancellation of those charters, and therefore adversely affect our anticipated results of operations. The delivery of newbuilding vessels could be delayed because of, among other things: work stoppages or other labor disturbances; bankruptcy or other financial crisis of the shipyard building the vessel; hostilities or political or economic disturbances in the countries where the vessels are being built, including any escalation of tensions involving North Korea; weather interference or catastrophic events, such as a major earthquake, tsunami or fire; our requests for changes to the original vessel specifications; requests from our customers, with whom our commercial managers arrange charters for such vessels, to delay construction and delivery of such vessels due to weak economic conditions and shipping demand or a dispute with the shipyard building the vessel.

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Credit conditions internationally might impact our ability to raise debt financing.

Global financial markets and economic conditions have been disrupted and volatile in recent years. At times, the credit markets as well as the debt and equity capital markets were distressed and it was difficult for many shipping companies to obtain adequate financing. The cost of available financing also increased significantly, but for leading shipping companies has since declined. The global financial markets and economic conditions could again experience volatility and disruption in the future.

We have traditionally financed our vessel acquisitions or constructions with our own cash (equity) and bank debt from various reputable national and international commercial banks. In relation to newbuilding contracts, the equity portion usually covers all or part of the pre-delivery obligations while the debt portion covers the outstanding amount due to the shipyard on delivery. More recently, however, we have arranged pre-delivery bank financing to cover much of the installments due before delivery, and, therefore, we would be required to provide part of our equity at delivery. In addition, several of our existing loans will mature over the next few years, including the current year. In the event that the related vessels are not sold, or we do not wish to use existing cash for paying the final balloon payments, then re-financing of the loans for an extended period beyond the maturity date will be necessary. Current and future terms and conditions of available debt financing, especially for older vessels without time charter could be different from terms obtained in the past and could result in a higher cost of capital, if available at all. Any adverse development in the credit markets could materially alter our current and future financial and corporate planning and growth and have a negative impact on our balance sheet.

The future performance of our subsidiaries’ LNG carriers depends on continued growth in LNG production and demand for LNG and LNG shipping.

The future performance of our subsidiaries’ LNG carriers will depend on continued growth in LNG production and the demand for LNG and LNG shipping. A complete LNG project includes production, liquefaction, storage, re-gasification and distribution facilities, in addition to the marine transportation of LNG. Increased infrastructure investment has led to an expansion of LNG production capacity in recent years, but material delays in the construction of new liquefaction facilities could constrain the amount of LNG available for shipping, reducing ship utilization. The rate of growth in global LNG demand has fluctuated due to several factors, including the global economic crisis and continued economic uncertainty, fluctuations in the price of natural gas and other sources of energy, growth in natural gas production from unconventional sources in regions such as North America and the highly complex and capital intensive nature of new or expanded LNG projects, including liquefaction projects. Growth in LNG production and demand for LNG and LNG shipping could be negatively affected by a number of factors, including:

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Reduced demand for LNG or LNG shipping, or any reduction or limitation in LNG production capacity, could have a material adverse effect on our ability to secure future multi-year time charters for the LNG carriers, or for any new LNG carriers our subsidiaries may acquire, which could harm our business, financial condition, results of operations and cash flows, including cash available for dividends to our shareholders.

Demand for LNG shipping could be significantly affected by volatile natural gas prices and the overall demand for natural gas.

Gas prices are volatile and are affected by numerous factors beyond our control, including but not limited to the following:

In recent years, global crude oil prices were very volatile. Any decline in oil prices can depress natural gas prices and lead to a narrowing of the gap in pricing in different geographic regions, which can adversely affect the length of voyages in the spot LNG shipping market and the spot rates and medium term charter rates for charters which commence in the near future. Any continued period of low oil prices could adversely affect both the competitiveness of gas as a fuel for power generation and the market price of gas, to the extent that gas prices are benchmarked to the price of crude oil. Some production companies have announced delays or cancellations of certain previously announced LNG projects, which, unless offset by new projects coming on stream, could adversely affect demand for LNG charters over the next few years, while the amount of tonnage available for charter is expected to increase.

An oversupply of LNG carriers may lead to a reduction in the charter hire rates we are able to obtain when seeking charters in the future.

Driven in part by an increase in LNG production capacity and the expectation of further future capacity, the construction and delivery of new LNG carriers has been increasing. Any future expansion of the global LNG carrier fleet that cannot be absorbed by existing or future LNG projects may have a negative impact on charter rates, ship utilization and ship values. Such impact could be amplified if the expansion of LNG production capacity does not keep pace with fleet growth.

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Hire rates for LNG carriers may fluctuate substantially and declined significantly during 2016. If rates remain low when we are seeking a new charter, our revenues and cash flows may decline.

The significant fall in oil prices over the past two years has contributed to substantial declines in the price of LNG, which coupled with delays in the completion of liquefaction and regasification facilities around the world and a high order book, particularly with vessels ordered on speculation, has led to declines in average rates for new spot and shorter-term LNG charters. Unless LNG charter market conditions improve over the next eighteen months, we may have difficulty in securing new charters at attractive rates and durations for our two LNG carriers when their current charters expire.

We depend upon Hyundai Ocean Services to manage our LNG carrier.

Tsakos Energy Management has subcontracted all technical management of our LNG operation to Hyundai Ocean Services Co., Ltd (“HOS”) for a fee. Neither Tsakos Energy Management nor TCM has the dedicated personnel for running LNG operations nor can we guarantee that they will employ an adequate number of employees to conduct LNG operations in the future. As such, we are currently dependent on the reliability and effectiveness of third-party managers for whom we cannot guarantee that their employees, both onshore and at-sea are sufficient in number or capability for their assigned role. We also cannot assure you that we will be able to continue to receive such services from HOS on a long-term basis on acceptable terms or at all.

Our growth in shuttle tankers depends partly on continued growth in demand for offshore oil transportation, processing and storage services.

Our growth strategy includes expansion in the shuttle tanker sector. Growth in this sector depends on continued growth in world and regional demand for these offshore services, which could be negatively affected by a number of factors, such as:

Oil prices have declined substantially in the last two years, which has resulted in oil companies announcing reductions in oil production and exploration activities, including in offshore fields.

Fuel prices may adversely affect our profits.

While we do not bear the cost of fuel (bunkers) under time and bareboat charters, fuel is the largest, expense in our shipping operations when vessels are under spot charters. Increases in the price of fuel may, as a result, adversely affect our profitability. The price and supply of fuel is unpredictable and fluctuates based on events outside our control, including geopolitical developments.

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If our counterparties were to fail to meet their obligations under a charter agreement we could suffer losses or our business could be otherwise adversely affected.

As of April 5, 2017, 40 of our subsidiaries’ vessels were employed under time charters and time charters with profit share. The ability and willingness of each of the counterparties to perform their obligations under their charters will depend on a number of factors that are beyond our control and may include, among other things, general economic conditions, the condition of the oil and energy industries and of the oil and oil products shipping industry as well as the overall financial condition of the counterparties and prevailing charter rates. There can be no assurance that some of our subsidiaries’ customers would not fail to pay charter hire or attempt to renegotiate charter rates and, if the charterers fail to meet their obligations or attempt to renegotiate charter agreements, we could sustain significant losses which could have a material adverse effect on our business, financial condition, results of operations and cash flows, as well as our ability to pay dividends in the future.

The shipping industry has inherent operational risks that may not be adequately covered by our insurance.

We believe that we maintain as much insurance on the vessels in the fleet, through insurance companies, including Argosy, a related party company, and P&I clubs, as is appropriate and consistent with industry practice. While we endeavor to be adequately insured against all known risks related to the operation of our subsidiaries’ ships, there remains the possibility that a liability may not be adequately covered and we may not be able to obtain adequate insurance coverage for the fleet in the future. The insurers may also not pay particular claims. Even if our insurance coverage is adequate, we may not be able to timely obtain a replacement vessel in the event of a loss. Our insurance policies contain deductibles for which we will be responsible and limitations and exclusions which may increase our costs or lower our revenue. In addition, some of our insurance coverage is maintained through mutual protection and indemnity associations, and as a member of such associations we may be required to make additional payments over and above budgeted premiums if member claims exceed association reserves.

Our degree of leverage and certain restrictions in our financing agreements impose constraints on us.

We incur substantial debt to finance the acquisition of our vessels. At December 31, 2016, our debt to capital ratio was 55.5% (debt / debt plus equity), with $1.8 billion in debt outstanding. We are required to apply a substantial portion of our cash flow from operations to the payment of principal and interest on this debt. In 2016, 74% of our cash flow derived from operations was dedicated to debt service, excluding any debt prepayment upon the sale of vessels, voluntary early debt prepayments and balloon payments to be refinanced. This limits the funds available for working capital, capital expenditures, dividends and other purposes. Our degree of leverage could have important consequences for us, including the following:

In addition, our financing arrangements, which we secured by mortgages on our ships, impose operating and financial restrictions on us that restrict our ability to:

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We have a holding company structure which depends on dividends from our subsidiaries and interest income to pay our overhead expenses and otherwise fund expenditures consisting primarily of advances on newbuilding contracts and the payment of dividends to our shareholders. As a result, restrictions contained in our financing arrangements and those of our subsidiaries on the payment of dividends may restrict our ability to fund our various activities.

We are exposed to volatility in LIBOR and selectively enter into derivative contracts, which can result in higher than market interest rates and charges against our income.

Over the past thirteen years we have selectively entered into derivative contracts both for investment purposes and to hedge our overall interest expense and, more recently, our bunker expenses. Our board of directors monitors the status of our derivatives in order to assess whether such derivatives are within reasonable limits and reasonable in light of our particular investment strategy at the time we entered into the derivative contracts.

Loans advanced under our secured credit facilities are, generally, advanced at a floating rate based on LIBOR, which has been stable and at historically low levels in recent years, but was volatile in prior years, which can affect the amount of interest payable on our debt, and which, in turn, could have an adverse effect on our earnings and cash flow. Our financial condition could be materially adversely affected at any time that we have not entered into interest rate hedging arrangements to hedge our interest rate exposure and the interest rates applicable to our credit facilities and any other financing arrangements we may enter into in the future, including those we enter into to finance a portion of the amounts payable with respect to newbuildings, increase. Moreover, even if we have entered into interest rate swaps or other derivative instruments for purposes of managing our interest rate or bunker cost exposure, our hedging strategies may not be effective and we may incur substantial loss.

We have a risk management policy and the Audit Committee oversees all our derivative transactions. It is our policy to monitor our exposure to business risk, and to manage the impact of changes in interest rates, foreign exchange rate movements and bunker prices on earnings and cash flows through derivatives. Derivative contracts are executed when management believes that the action is not likely to significantly increase overall risk. Entering into swaps and derivatives transactions is inherently risky and presents various possibilities for incurring significant expenses. The derivatives strategies that we employ in the future may not be successful or effective, and we could, as a result, incur substantial additional interest costs. See “Item 11. Quantitative and Qualitative Disclosures About Market Risk” for a description of our current interest rate swap arrangements.

Our subsidiaries’ vessels may suffer damage and we may face unexpected dry-docking costs which could affect our cash flow and financial condition.

If our vessels suffer damage, they may need to be repaired at a dry-docking facility. The costs of dry-dock repairs can be both substantial and unpredictable. We may have to pay dry-docking costs that our insurance does not cover. This would result in decreased earnings.

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If we were to be subject to corporate income tax in jurisdictions in which we operate, our financial results would be adversely affected.

Our income is not presently subject to taxation in Bermuda, which has no corporate income tax. We believe that we should not be subject to tax under the laws of various countries, other than the United States, in which our subsidiaries’ vessels conduct activities or in which our subsidiaries’ customers are located. However, our belief is based on our understanding of the tax laws of those countries, and our tax position is subject to review and possible challenge by taxing authorities and to possible changes in law or interpretation. We cannot determine in advance the extent to which certain jurisdictions may require us to pay corporate income tax or to make payments in lieu of such tax. In addition, payments due to us from our subsidiaries’ customers may be subject to tax claims. As a result of the continuing economic crisis in Greece, our operations in Greece may be subjected to new regulations that may require us to incur new or additional compliance or other administrative costs, which may include requirements that we pay to the Greek government new taxes or other fees. In addition, China has enacted a new tax for non-resident international transportation enterprises engaged in the provision of services of passengers or cargo, among other items, in and out of China using their own, chartered or leased vessels, including any stevedore, warehousing and other services connected with the transportation. The new regulation broadens the range of international transportation companies which may find themselves liable for Chinese enterprise income tax on profits generated from international transportation services passing through Chinese ports.

If we or our subsidiaries are not entitled to exemption under Section 883 of the United States Internal Revenue Code of 1986, as amended, for any taxable year, we or our subsidiaries would be subject for those years to a 4% United States federal income tax on our gross U.S.-source shipping revenue, without allowance for deductions, under Section 887 of the Internal Revenue Code. The imposition of such tax could have a negative effect on our business and would result in decreased earnings available for distribution to our shareholders.

See “Tax Considerations—United States federal income tax considerations” for additional information about the requirements of this exemption.

If we were treated as a passive foreign investment company, a U.S. investor in our shares would be subject to disadvantageous rules under the U.S. tax laws.

If we were treated as a passive foreign investment company (a “PFIC”) in any year, our U.S. shareholders would be subject to unfavorable U.S. federal income tax treatment. We do not believe that we will be a PFIC in 2017 or in any future year. However, PFIC classification is a factual determination made annually and we could become a PFIC if the portion of our income derived from bareboat charters or other passive sources were to increase substantially or if the portion of our assets that produce or are held for the production of passive income were to increase substantially. Moreover, the IRS may disagree with our position that time and voyage charters do not give rise to passive income for purposes of the PFIC rules. Accordingly, we can provide no assurance that we will not be treated as a PFIC for 2016 or for any future year. Please see “Tax Considerations—United States federal income tax considerations—Passive Foreign Investment Company Considerations” herein for a description of the PFIC rules.

Distributions on shares of non-U.S. companies that are treated as dividends for U.S. federal income tax purposes and are received by individuals generally will be eligible for taxation at capital gain rates if the shares with respect to which the dividends are paid are readily tradable on an established securities market in the United States. This treatment will not be available to dividends we pay, however, if we qualify as a PFIC for the taxable year of the dividend or the preceding taxable year, or to the extent that (i) the shareholder does not satisfy a holding period requirement that generally requires that the shareholder hold the shares on which the dividend is paid for more than 60 days during the 121-day period that begins 60 days before the date on which the shares become ex-dividend with respect to such dividend, (ii) the shareholder is under an obligation to make related payments with respect to substantially similar or related property or (iii) such dividend is taken into account as

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investment income under Section 163(d)(4)(B) of the Internal Revenue Code. We do not believe that we qualified as a PFIC for our last taxable year and, as described above, we do not expect to qualify as a PFIC for our current or future taxable years. Legislation has been proposed in the United States Congress which, if enacted in its current form, would likely cause dividends on our shares to be ineligible for the preferential tax rates described above. There can be no assurance regarding whether, or in what form, such legislation will be enacted.

Because some of our subsidiaries’ vessels’ expenses are incurred in foreign currencies, we are exposed to exchange rate risks.

The charterers of the vessels owned by our subsidiary companies pay in U.S. dollars. While most of the expenses incurred by our managers or by us on our subsidiaries’ behalf are paid in U.S. dollars, certain of these expenses are in other currencies, most notably the Euro. In 2016, Euro expenses accounted for approximately 33% of our total operating expenses, including dry-dockings. Declines in the value of the U.S. dollar relative to the Euro, or the other currencies in which we incur expenses, would increase the U.S. dollar cost of paying these expenses and thus would adversely affect our results of operations.

The Tsakos Holdings Foundation and the Tsakos family can exert considerable control over us, which may limit your ability to influence our actions.

As of April 5, 2017, companies controlled by the Tsakos Holdings Foundation or affiliated with the Tsakos Group own approximately 34% of our outstanding common shares. The Tsakos Holdings Foundation is a Liechtenstein foundation whose beneficiaries include persons and entities affiliated with the Tsakos family, charitable institutions and other unaffiliated persons and entities. The council which controls the Tsakos Holdings Foundation consists of five members, two of whom are members of the Tsakos family. As long as the Tsakos Holdings Foundation and the Tsakos family beneficially own a significant percentage of our common shares, each will have the power to influence the election of the members of our board of directors and the vote on substantially all other matters, including significant corporate actions.

Risks Related To Our Common and Preferred Shares

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

Sales of a substantial number of our common shares in the public market, or the perception that these sales could occur, may depress the market price for our common shares. These sales could also impair our ability to raise additional capital through the sale of our equity securities in the future. We may issue additional common shares in the future and our shareholders may elect to sell large numbers of shares held by them from time to time.

The market price of our common shares and preferred shares may be unpredictable and volatile.

The market price of our common shares and Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares and Series E Preferred Shares may fluctuate due to factors such as actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry, mergers and strategic alliances in the tanker industry, market conditions in the tanker industry, changes in government regulation, shortfalls in our operating results from levels forecast by securities analysts, announcements concerning us or our competitors, our sales of our common shares or of additional preferred shares, changes in prevailing interest rates and the general state of the securities market. The tanker industry has been highly unpredictable and volatile. The market for common stock and preferred stock in this industry may be equally volatile. Therefore, we cannot assure you that you will be able to sell any of our common shares and preferred shares you may have purchased, or will purchase in the future, at a price greater than or equal to the original purchase price.

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If the market price of our common shares remains below $5.00 per share, under stock exchange rules, our shareholders will not be able to use such shares as collateral for borrowing in margin accounts. This inability to use common shares as collateral may depress demand and certain institutional investors are restricted from investing in or holding shares priced below $5.00, which could lead to sales of such shares creating further downward pressure on and increased volatility in the market price of our common shares.

We may not be able to pay cash dividends on our common shares or preferred shares as intended if market conditions change.

During 2016, we paid dividends on our common shares totaling $0.29 per common share, totaling $24.5 million. On March 17, 2017, the Company announced a common share dividend of $0.05 per common share to be paid on April 28, 2017 to holders of record as of April 25, 2017. In addition, during 2016 we paid dividends on our preferred shares totaling $15.9 million and another $4.0 million in January and February 2017. Subject to the limitations discussed below, we currently intend to continue to pay cash dividends on our common shares and preferred shares. However, there can be no assurance that we will pay dividends or as to the amount of any dividend. The payment and the amount will be subject to the discretion of our board of directors and will depend, among other things, on restrictions in the Companies Act of 1981 of Bermuda, as amended, or the Companies Act, on our available cash balances, anticipated cash needs, our results of operations, our financial condition, and any loan agreement restrictions binding us or our subsidiaries, including a limit on dividends exceeding 50% of our net income for any particular year, plus certain additional amounts permitted to the extent 50% of our aggregate net income in prior years exceeded dividends paid during such years, as well as other relevant factors. Net losses that we incurred in certain of our historical periods as well as dividends that we historically paid reduce the amount of the accumulated consolidated net income from which we are permitted to pay dividends under our loan agreements while net income in other periods increases the amount. In addition, dividends on our common shares are subject to the priority of our dividend obligations relating to our Series B, Series C, Series D and Series E Preferred Shares. We may have insufficient cash to pay dividends on or redeem our Series B, Series C, Series D and Series E Preferred Shares, or pay dividends on our common shares. Depending on our operating performance for a particular year, this could result in no dividend at all despite the existence of net income, or a dividend that represents a lower percentage of our net income.

Because we are a holding company with no material assets other than the stock of our subsidiaries, our ability to pay dividends will depend on the earnings and cash flow of our subsidiaries and their ability to pay us dividends. In addition, the financing arrangements for indebtedness we incur in connection with our newbuilding program may further restrict our ability to pay dividends. In the event of any insolvency, bankruptcy or similar proceedings of a subsidiary, creditors of such subsidiary would generally be entitled to priority over us with respect to assets of the affected subsidiary. Investors in our common shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares or Series E Preferred Shares may be adversely affected if we are unable to or do not pay dividends as intended.

Market interest rates may adversely affect the value of our Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares and Series E Preferred Shares.

One of the factors that influences the price of our Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares and Series E Preferred Shares is the dividend yield on these preferred shares (as a percentage of the price thereof) relative to market interest rates. An increase in market interest rates, which are currently at low levels relative to historical rates, may lead to lower prices for our shares when valued using their dividend yields. Higher interest rates would likely increase our borrowing costs and potentially decrease funds available for dividends. Accordingly, higher interest rates could affect the market prices of our preferred shares to decrease.

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Holders of our Preferred Shares have extremely limited voting rights.

The voting rights of holders of Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares and Series E Preferred Shares are extremely limited. Our common shares are the only class or series of our shares carrying full voting rights. The voting rights of holders of these preferred shares are limited to the ability, subject to certain exceptions, to elect, voting together as a class with all other classes or series of parity securities upon which like voting rights have been conferred and are exercisable, one director if dividends for six quarterly dividend periods (whether or not consecutive) payable thereon are in arrears and certain other limited protective voting rights described in “Item 10. Additional Information—Description of Share Capital—Preferred Shares.”

Provisions in our Bye-laws and our management agreement with Tsakos Energy Management would make it difficult for a third party to acquire us, even if such a transaction is beneficial to our shareholders.

Our Bye-laws provide for a staggered board of directors, blank check preferred stock, super majority voting requirements and other anti-takeover provisions, including restrictions on business combinations with interested persons and limitations on the voting rights of shareholders who acquire more than 15% of our common shares. In addition, Tsakos Energy Management would have the right to terminate our management agreement and seek liquidated damages if a board member were elected without having been approved by the current board. These provisions could deter a third party from tendering for the purchase of some or all of our shares. These provisions may have the effect of delaying or preventing changes of control of the ownership and management of our company.

Because we are a foreign corporation, you may not have the same rights as a shareholder in a U.S. corporation.

We are a Bermuda corporation. Our Memorandum of Association and Bye-laws and the Companies Act govern our affairs. While many provisions of the Companies Act resemble provisions of the corporation laws of a number of states in the United States, Bermuda law may not as clearly establish your rights and the fiduciary responsibilities of our directors as do statutes and judicial precedent in some U.S. jurisdictions. In addition, apart from three non-executive directors, our directors and officers are not resident in the United States and all or substantially all of our assets are located outside of the United States. As a result, investors may have more difficulty in protecting their interests and enforcing judgments in the face of actions by our management, directors or controlling shareholders than would shareholders of a corporation incorporated in a U.S. jurisdiction.

In addition, you should not assume that courts in the country in which we are incorporated or where our assets are located would enforce judgments of U.S. courts obtained in actions against us based upon the civil liability provisions of applicable U.S. federal and state securities laws or would enforce, in original actions, liabilities against us based on those laws.

We are a “foreign private issuer” under NYSE rules, and as such we are entitled to exemption from certain NYSE corporate governance standards, and you may not have the same protections afforded to shareholders of companies that are subject to all of the NYSE corporate governance requirements.

We are a “foreign private issuer” under the securities laws of the United States and the rules of the NYSE. Under the securities laws of the United States, “foreign private issuers” are subject to different disclosure requirements than U.S. domiciled registrants, as well as different financial reporting requirements. Under the NYSE rules, a “foreign private issuer” is subject to less stringent corporate governance requirements. Subject to certain exceptions, the rules of the NYSE permit a “foreign private issuer” to follow its home country practice in lieu of the listing requirements of the NYSE, including (i) the requirement that a majority of the board of directors consist of independent directors, (ii) the requirement that the nominating/corporate governance committees be composed entirely of independent directors and have a written charter addressing the committee’s

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purpose and responsibilities, (iii) the requirement that the compensation committee be composed entirely of independent directors and have a written charter addressing the committee’s purpose and responsibilities, and (iv) the requirement of an annual performance evaluation of the nominating/corporate governance and compensation committees.

Nonetheless, a majority of our directors are independent, all of the members of our compensation, nominating and corporate governance committee are independent directors, and all of our board committees have written charters addressing their respective purposes and responsibilities.