3. Transactions with Related Parties
The Manager provides the vessels with a wide range of shipping services such as chartering, technical support and maintenance, insurance,
consulting, financial and accounting services, for a fixed daily fee of $440 per vessel operating under a voyage or time charter or $125 per vessel operating under a bareboat charter and a brokerage commission of 1.25% on freight, hire and demurrage
per vessel, as per the management agreement between the Manager and the Company. The Manager has subcontracted the technical management of some of the vessels to an affiliated ship-management company, Brave Maritime Corp. Inc. (Brave).
This company provides technical management to the Companys vessels for a fixed annual fee per vessel which is paid by the Manager. For the years ended December 31, 2016, 2017 and 2018, total brokerage commissions of 1.25% amounted to
$1,772,240, $1,912,505 and $2,037,917, respectively, and are included in Voyage expensesrelated party in the consolidated statements of operations. For the years ended December 31, 2016, 2017 and 2018, the management fees were
$7,346,180, $7,205,490 and $7,027,195, respectively and are included in Management fees related party in the consolidated statements of operations. In addition, the Manager arranges for supervision onboard the vessels, when
required, by superintendent engineers and when such visits exceed a period of five days in a twelve month period, an amount of $500 is charged for each additional day. For the years ended December 31, 2016, 2017 and 2018, the superintendent
fees amounted to $172,000, $125,500 and $137,000, respectively, and are included in Vessels operating expenses related party in the consolidated statements of operations.
Effective from 2018, the Manager provides crew management services to some of the Companys vessels. These services have been
subcontracted by the Manager to an affiliated ship-management company, Navis Maritime Services Inc. The Company pays to the Manager a fixed monthly fee of $2,500 per vessel. For the year ended December 31, 2018, the crew management fees
amounted to $377,500, and are included in Vessels operating expenses related party in the consolidated statements of operations.
The Manager also acts as a sales and purchase broker for the Company in exchange for a commission fee equal to 1% of the gross sale or
purchase price of vessels or companies. For the years ended December 31, 2016, 2017 and 2018 commission fees relating to vessels purchased of $421,639, $525,978 and $1,598,858, respectively, were incurred and capitalized to the cost of the
vessels. For the years ended December 31, 2016, 2017 and 2018 the amounts of $13,711, $119,900 and $184,000 were recognized as commission expenses relating to the sale of vessels and are included in the consolidated statements of operations
under the caption Net (gain)/loss on sale of vessels. For the year ended December 31, 2018, commission expenses relating to the sale of vessels of $212,650 are included in the consolidated statements of operations under the caption
Impairment loss.
In addition to management services, the Company reimburses the Manager for compensation of its Chief
Executive Officer, its Chief Financial Officer, its Internal Auditor, its Chief Technical Officer, its Finance Manager and its Deputy Chairman and Executive Director, which reimbursements were in the amounts of $1,114,130, $1,127,307 and $1,210,036,
for the years ended December 31, 2016, 2017 and 2018, respectively, and are included in the consolidated statements of operations under the caption General and administrative expenses.
The current account balance with the Manager at December 31, 2017 and at December 31, 2018 was a liability of $14,209,624 and
$7,930,642, respectively. The liability represents payments made by the Manager on behalf of the ship-owning companies.
The Company rents
office space that is owned by an affiliated company of the Manager. Rental expense for the years ended December 31, 2016, 2017 and 2018 amounted to $72,907, $82,192 and $84,686, respectively, and is included in the consolidated statements of
operations under the caption General and administrative expenses.
In April 2012, the Company entered into time charter
agreements for two of the Companys vessels with Emihar Petroleum Inc., a company affiliated with members of the Vafias family incorporated in the Marshall Islands. The above time charter agreements expired in August 2016 and June 2017. Revenue
from the related
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