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 Company’s vessels for a fixed annual fee per vessel which is paid by the Manager. For the years ended

December

31,

2014,

2015

and

2016,

total brokerage commissions of

1.25%

amounted to

$1,613,421,

$1,725,683

and

$1,772,240,

respectively, and are included in “Voyage expenses – related party” in the consolidated statements of operations. For the years ended

December

31,

2014,

2015

and

2016,

the management fees were

$5,501,675,

$6,452,145

and

$7,346,180,

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,

2014,

2015

and

2016,

the superintendent fees amounted to

$167,000,

$245,000

and

$172,000,

respectively, 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

of the gross sale or purchase price of vessels or companies. For the years ended

December

31,

2014,

2015

and

2016

commission fees relating to vessels purchased of

$984,355,

$1,925,563

and

$421,639,

respectively, were incurred and capitalized to the cost of the vessels. For the year ended

December

31,

2014

an amount of

$285,000

was recognized as commission expenses relating to the sale and leaseback of vessels and is included in the consolidated balance sheets under the caption “Deferred gain on sale and leaseback of vessels”. For the years ended

December

31,

2015

and

2016

the amounts of

$21,177

and

$13,711

were recognized as commission expenses relating to the sale of vessels and is included in the consolidated statements of operations under the caption “Net gain on sale of vessels”.

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

$1,317,237,

$1,077,698

and

$1,114,130,

for the years ended

December

31,

2014,

2015

and

2016,

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,

2015

and at

December

31,

2016

was a liability of

$9,188,852

and

$7,890,933,

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,

2014,

2015

and

2016

amounted to

$76,788,

$72,753

and

$72,907,

respectively, and is included in the consolidated statements of operations under the caption “General and administrative expenses”.

April

2012,

the Company entered into time charter agreements for

two

of the Company’s vessels with Emihar Petroleum Inc., a company affiliated with members of the Vafias family incorporated in the Marshall Islands. One of the above time charter agreements expired in

August

2016.

Revenue from the related party amounted to

9,814,000

for each of the years ended

December

31,

2014

and

2015,

respectively, and

$7,592,784

for the year ended

December

31,

2016,

and are included in the consolidated statements of operations under the caption “Revenues – related party”. In accordance with the time charter agreements for the vessels’ operating expenses, the Company paid to the Manager amounts of

$3,932,352,

$3,932,042

and

$2,969,843

for the years ended

December

31,

2014,

2015

and

2016,

respectively, which are included in the consolidated statements of operations under the caption “Vessels’ operating expenses – related party”. The receivable balance with Emihar Petroleum Inc. as of

December

31,

2015

and

2016,

was a receivable of

$228,494

and

$115,599,

respectively.

May

26,

2014,

the Company entered into an agreement with Brave for the supervision of the construction of

eight

of its vessels for a fixed fee of Euro

390,000

per vessel. For the years ended

December

31,

2014,

2015

and

2016,

the supervision fees amounted to

$984,204,

$1,726,265

and

$854,022,

respectively, and were capitalized to the cost of the respective vessels.

January

25,

2016,

the Company entered into an agreement with Brave for the supervision of the construction of

four

of its vessels for a fixed fee of Euro

490,000

($539,343

based upon the EUR/USD exchange rate of

1.1007)

per vessel.