6-K
Castor Maritime Inc. (CTRM)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2022
Commission File Number: 001-38802
CASTOR MARITIME INC.
(Translation of registrant’s name into English)
223 Christodoulou Chatzipavlou Street, Hawaii Royal Gardens, 3036 Limassol, Cyprus
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
| Form 20-F ☒ | Form 40-F ☐ |
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Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Note: Regulation S-T Rule 101(b) (1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
On November 16, 2022, Castor Maritime Inc. (the “Company” or “Castor”) announced that its Board of Directors, consisting of its independent disinterested members (the “Board"), has decided, on the recommendation of a special committee of the Board, to effect a spin-off of its tanker fleet comprising one Aframax, five Aframax/LR2 and two Handysize tankers (the “Spin-Off”). In the Spin-Off, Castor shareholders will receive two common shares of Toro Corp. (“Toro”), a newly formed subsidiary that will act as the holding company for the eight tanker vessels, for every five Castor common shares held at the close of business on December 6, 2022 (the “Record Date”). The distribution is expected to occur on or about December 15, 2022 (the “Distribution Date”).
In connection with and as part of the Spin-Off, the Board, based on the recommendation of the Special Committee, has approved, among other things, the contribution to Toro of Castor’s eight tanker-owning subsidiaries and Elektra Shipping Co. (the subsidiary formerly owning the M/T Wonder Arcturus, which was delivered to its new owners on July 15, 2022) in exchange for:
| • | all of Toro’s issued and outstanding shares of common stock, par value $0.001 per share; |
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| • | 60,000 of our 1.00% Series A fixed rate cumulative perpetual preferred shares, with a cumulative preferred distribution accruing initially at a rate of 1.00% per annum on the stated amount of $1,000 per share;<br> all of these shares will be retained by Castor after the Spin-Off; and |
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| • | the issuance of 40,000 Series B preferred shares, each carrying 100,000 votes on all matters on which Toro shareholders are entitled to vote but no economic rights, to Pelagos Holdings Corp., a company<br> controlled by Mr. Panagiotidis, the Company’s Chairman, Chief Executive Officer and Chief Financial Officer against payment of their nominal value of $0.001 per Series B Preferred Share. |
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| • | In connection with and with effect as of the completion of the Spin-Off, Toro will replace Castor as Guarantor under the $18.0 million senior secured credit facility entered into by two tanker-owning<br> subsidiaries and the terms of such facility will be amended accordingly. |
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Mr. Panagiotidis has been appointed as Toro’s Chairman and Chief Executive Officer with effect as of completion of the Spin-Off. The independent, disinterested members of each of Castor and Toro’s boards of directors have resolved to focus on the companies’ respective current lines of business with no expectancy that Mr. Panagiotidis will present each respective company with any opportunity in areas of business outside of their declared area of focus. This does not prevent Castor or Toro from pursuing opportunities outside of the dry bulk and tanker shipping businesses, respectively, if in the future their respective boards of directors determine to do so.
In accordance with the terms of the Company's outstanding warrants, effective immediately after the effective date of the Spin-Off, the exercise price of the warrants shall be decreased by the fair market value of the Toro common shares distributed to Castor shareholders.
Toro has applied to have its common shares listed on the Nasdaq Capital Market. The Spin-Off remains subject, among other things, to Toro’s registration statement on Form 20-F being declared effective and the approval of the listing of Toro’s common shares on the Nasdaq Capital Market.
Attached to this report on Form 6-K as Exhibit 99.1 is a copy of the press release issued by Castor Maritime Inc. relating to the proposed Spin-Off.
On November 15, 2022, the Board approved an amendment to the terms of the Company’s Series B preferred shares to entitle the holders thereof to (i) receive preferred shares with at least substantially identical rights and preferences in the event of a future spin-off of a controlled company, (ii) participate in a liquidation, dissolution or winding up of Castor pari passu with Castor’s common shares up to the Series B preferred shares’ nominal value, (iii) have their voting power adjusted to maintain a substantially identical voting interest upon the occurrence of certain events, (iv) in a merger, consolidation or business combination involving the Company that has not been approved by them, retain substantially the same economic and voting rights in the Company or the surviving/resulting entity and (v) in a merger, consolidation or business combination involving the Company that has been approved by them, receive cash or property upon the consummation of such transaction only up to an amount equal to the par value of such holder’s shares. A copy of the Amended and Restated Statement of Designation of the Series B preferred shares is attached as Exhibit 99.2 to this report.
The information contained in this report on Form 6-K and Exhibits 99.1 and 99.2 attached hereto are hereby incorporated by reference into the Company’s registration statements on Form F-3 (File Nos. 333-236331, 333-240262 and 333-254977).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CASTOR MARITIME INC. | ||
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| Dated: November 16, 2022 | ||
| By: | /s/ Petros Panagiotidis | |
| Petros Panagiotidis | ||
| Chairman, Chief Executive Officer and | ||
| Chief Financial Officer |
Exhibit 99.1
Castor Maritime Inc. Announces Proposed Spin-Off of its Tanker Fleet
Limassol, Cyprus, November 16, 2022 – Castor Maritime Inc. (NASDAQ: CTRM), (“Castor” or the “Company”), a diversified global shipping company, announced today that its Board of Directors, consisting of its independent disinterested members (the “Board”), has decided, on the recommendation of a special committee of the Board, to effect a spin-off of its tanker fleet comprising one Aframax, five Aframax/LR2 and two Handysize tankers (the “Spin-Off”). In the Spin-Off, Castor shareholders will receive two common shares of Toro Corp. (“Toro”), a newly formed subsidiary that will act as the holding company for the eight tanker vessels, for every five Castor common shares held at the close of business on December 6, 2022 (the “Record Date”). Toro has applied to have its common shares listed on the Nasdaq Capital Market. Castor’s Chairman, Chief Executive Officer and Chief Financial Officer, Petros Panagiotidis, has been appointed as Chairman and Chief Executive Officer of Toro with effect as of the completion of the Spin-Off.
The Board believes that the creation of a business in a distinct sector of the shipping industry – tankers – will provide significant benefits to both companies and their shareholders. The transaction is expected to enable each of Castor and Toro to increase its focus on its respective line of businesses, enhance operational efficiencies, facilitate efficient strategic expansion, attract new investors, and, with this dividend distribution of Toro common shares, give Castor shareholders the flexibility to monetize or adjust their equity holdings according to the shipping sectors in which they want to invest.
Castor shareholders do not need to take any action to receive Toro shares to which they are entitled, and do not need to pay any consideration or surrender or exchange Castor common shares. Fractional Toro common shares will not be distributed to Castor shareholders. Instead, the distribution agent will aggregate fractional Toro common shares into whole shares, sell such whole Toro shares in the open market at prevailing rates promptly after Toro’s common shares commence trading on the Nasdaq Capital Market, and distribute the net cash proceeds from the sales pro rata to each holder who would otherwise have been entitled to receive fractional common shares in the distribution. The distribution is expected to occur on or about December 15, 2022 (the “Distribution Date”).
Toro has filed a registration statement on Form 20-F pursuant to the Securities Exchange Act of 1934 with the Securities and Exchange Commission, which includes a more detailed description of the terms of the proposed Spin-Off. The Spin-Off remains subject to the registration statement on Form 20-F being declared effective and the approval of the listing of Toro’s common shares on the Nasdaq Capital Market. There can be no assurance that the Spin-Off will occur or, if it does occur, of its terms or timing. A copy of the registration statement on Form 20-F is available at www.sec.gov. The information in the filed registration statement on Form 20-F is not final and remains subject to change.
About Castor Maritime Inc.
Castor Maritime Inc. is an international provider of shipping transportation services through its ownership of oceangoing cargo vessels.
Castor owns a fleet of 28 vessels, with an aggregate capacity of 2.4 million dwt, consisting of 1 Capesize, 7 Kamsarmax and 12 Panamax dry bulk vessels, as well as 1 Aframax, 5 Aframax/LR2 and 2 Handysize tankers.
For more information please visit the Company’s website at www.castormaritime.com. Information on our website does not constitute a part of this press release.
Cautionary Statement Regarding Forward-Looking Statements
Matters discussed in this press release may constitute forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. We are including this cautionary statement in connection with this safe harbor legislation. The words “believe”, “anticipate”, “intend”, “estimate”, “forecast”, “project”, “plan”, “potential”, “will”, “may”, “should”, “expect”, “pending” and similar expressions identify forward-looking statements. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these forward-looking statements, including these expectations, beliefs or projections. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise. In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward‐looking statements include the effects of the proposed Spin-Off, our business strategy, dry bulk and tanker market conditions and trends, the rapid growth of our fleet, our relationships with our current and future service providers and customers, our ability to borrow under existing or future debt agreements or to refinance our debt on favorable terms and our ability to comply with the covenants contained therein, our continued ability to enter into time or voyage charters with existing and new customers and to re-charter our vessels upon the expiry of the existing charters, changes in our operating and capitalized expenses, our ability to fund future capital expenditures and investments in the acquisition and refurbishment of our vessels, instances of off-hire, future sales of our securities in the public market and our ability to maintain compliance with applicable listing standards, volatility in our share price, potential conflicts of interest involving members of our board of directors, senior management and certain of our service providers that are related parties, general domestic and international political conditions or events (including “trade wars”, global public health threats and major outbreaks of disease), changes in seaborne and other transportation, changes in governmental rules and regulations or actions taken by regulatory authorities, and the impact of adverse weather and natural disasters. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties. The information set forth herein speaks only as of the date hereof, and we disclaim any intention or obligation to update any forward‐looking statements as a result of developments occurring after the date of this communication.
CONTACT DETAILS
For further information please contact:
Petros Panagiotidis
Castor Maritime Inc.
Email: ir@castormaritime.com
Media Contact:
Kevin Karlis
Capital Link
Email: castormaritime@capitallink.com
Exhibit 99.2
AMENDED AND RESTATED STATEMENT OF DESIGNATION OF RIGHTS, PREFERENCES AND PRIVILEGES OF THE SERIES B PREFERRED SHARES OF CASTOR MARITME INC.
CASTOR MARITIME INC., a corporation organized and existing under the Business Corporations Act (the “BCA”) of the Republic of the Marshall Islands (the “Company”), in accordance with the provisions of Section 35 thereof and the Articles of Incorporation of the Company (the “Articles”), does hereby certify:
Pursuant to the authority vested in the Board of Directors of the Company (the “Board”), and in accordance with the provisions of Section 35 of the BCA and the Articles, the Board has adopted the following resolution amending and restating certain terms, powers, preferences and other rights of the series of preferred shares of the Company, designated as “Series B Preferred Shares”, and certain qualifications, limitations and restrictions thereon. Capitalized terms shall have the same meaning as in the Articles, unless otherwise specified in this Statement of Designation or unless the context otherwise requires.
RESOLVED, that pursuant to the authority vested in the Board by the Articles and Section 35 of the BCA, the Board hereby amends and restates the Statement of Designation of Rights, Preferences and Privileges establishing a series of Preferred Shares, par value $0.001 per share, of the Company and hereby sets forth the designation and number of shares of such series, and the voting and other powers, preferences and relative, participating, optional or special rights and qualifications, limitations and restrictions thereof, of the shares of such series, are as follows:
Section 1. Designation and Amount. The shares of this series shall be designated as “Series B Preferred Shares” (hereinafter, called “this Series”). Shares of this Series shall have a par value of $0.001 per share, and the number of shares constituting this Series shall initially be twelve thousand (12,000), which number the Board may from time to time increase or decrease (but not below the number then outstanding).
Section 2. Adjustments. In the event the Company shall at any time after the issuance of any shares of this Series (i) declare any dividend on the common shares of the Company par value $0.001 per share (the “Common Shares”), payable in Common Shares, (ii) subdivide the outstanding Common Shares or (iii) combine the outstanding Common Shares into a smaller number of shares, then in each such case there shall be no adjustment to the number of outstanding shares of this Series.
Section 3. Voting Rights. Holders of shares of this Series shall have the following voting rights:
(a) Each share of this Series shall entitle its holder to one hundred thousand (100,000) votes on all matters submitted to a vote of the shareholders of the Company, provided, however that in the event the Company shall at any time after the issuance of any shares of this Series:
(i) approve the creation or issuance of shares of the Company carrying more than one vote per share to be issued to any person other than holders of shares of this Series (including, without limitation, by creating a new series of shares of the Company or amending the rights, preferences, privileges and voting powers of shares of the Company existing as of the date hereof) without the prior affirmative vote of a majority of votes cast by holders of shares of this Series, except for the creation (but not the issuance) of Series C Participating Preferred Stock of the Company; or
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(ii) issue or approve the issuance of Common Shares pursuant to and in accordance with the Company’s Stockholders Rights Agreement entered into between the Company and American Stock Transfer & Trust Company, LLC on November 20, 2017,
then in each such case, the voting powers of shares of this Series shall be adjusted concurrently, to the extent necessary, such that holders of shares of this Series shall maintain a substantially identical interest in the Company, including, without limitation, with respect to each such holder’s voting interest, as it does in the Company immediately prior to such event. The Board shall implement, or cause to be implemented, the foregoing in the manner provided herein and shall promptly notify each holder of shares of this Series in writing of the voting power conferred by its shares as determined in accordance with the foregoing after the calculations with respect to any such adjustment have been completed.
(b) Subject to Section 3(a), each share of this Series shall count for one hundred thousand (100,000) votes for purposes of determining quorum at a meeting of shareholders of the Company.
(c) Except as otherwise provided herein, by law or in the Articles, holders of shares of this Series and holders of the Common Shares shall vote together as one class on all matters submitted to a vote of shareholders of the Company.
(d) Except as otherwise provided herein, in the Articles or as required by law, holders of shares of this Series shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of the Common Shares as set forth herein) for taking any corporate action.
Section 4. Dividends and Distributions. So long as any shares of this Series are outstanding, if the Company declares or makes any dividend or other distribution of voting securities of a subsidiary of the Company which the Company controls to holders of Common Shares by way of a spin off or other similar transaction (a “Distribution”), then, in each such case, each holder of record of shares of this Series, as of the record date fixed by the Board for the determination of shareholders entitled to participate in such Distribution, shall be entitled to participate in such Distribution and receive preferred shares of the subsidiary whose voting securities are so distributed with at least substantially identical rights, preferences, privileges and voting powers, and limitations and restrictions as shares of this Series, such that each holder of shares of this Series shall maintain at least a substantially identical interest in such subsidiary, including, without limitation, with respect to such holder’s voting interest, as it does in the Company immediately prior to such Distribution. Subject to the foregoing and Section 5, shares of this Series shall have no other dividend or distribution rights.
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Section 5. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Company, shares of this Series shall be entitled to receive a payment on the same terms as and rank pari-passu with the Common Shares with respect thereto, up to an amount equal to the par value of $0.001 per share of this Series. Holders of shares of this Series will have no other rights to distributions upon any liquidation, dissolution or winding up of the Company.
Section 6. Consolidation, Merger, etc. In the event of (a) a binding share exchange or reclassification involving shares of this Series, (b) a merger or consolidation of the Company with or into another corporation or other entity, or (c) a business combination involving the Company, which in each case has not been approved by the prior affirmative vote of a majority of votes cast by holders of shares of this Series, either (x) the shares of this Series shall remain outstanding, or (y) in the case of any such transaction specified in prong (a), (b) or (c) of this Section 6, with respect to which the Company is not the surviving or resulting entity, shares of this Series shall be converted into or exchanged for preferred securities of the surviving or resulting entity or its ultimate parent, and in case of both (x) and (y), such shares remaining outstanding or such preferred securities, as the case may be, shall have such rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and limitations and restrictions, of shares of this Series immediately prior to such consummation, taken as a whole (including, without limitation, with respect to their voting interest); provided, however, that for all purposes of this Section 6, any increase in the authorized number of preferred shares, including any increase in the authorized number of shares of this Series, will not be deemed to adversely affect the rights, preferences, privileges or voting powers of the holders of shares of this Series, and provided, further, that in the event any of transaction specified in prong (a), (b) or (c) of this Section 6 has been approved by the prior affirmative vote of a majority of votes cast by holders of shares of this Series, shares of this Series shall, upon the consummation of such transaction, receive cash/and or any other property up to an amount equal to the par value of $0.001 per share of this Series.
Section 7. No Redemption. The shares of this Series shall not be redeemable.
Section 8. Amendment. So long as any shares of this Series are outstanding, neither this Statement of Designation nor the Articles shall be amended in any manner which would materially alter or change the powers, preferences or special rights of the shares of this Series so as to affect them adversely without the prior affirmative vote of the holders of a majority of the outstanding shares of this Series, voting separately as a class.
Section 9. Reacquired Shares. Any shares of this Series purchased by the Company shall be cancelled and shall revert to authorized but unissued preferred shares undesignated as to series and may be reissued as part of a new series of preferred shares to be created by resolution or resolutions of the Board, subject to the conditions set forth in the Articles.
Section 10. Fractional Shares. Shares of this Series may not be issued in fractional shares.
Section 11. Notices. Any notice to be delivered hereunder shall be delivered (via overnight courier, facsimile or email) to each holder at its last address as it shall appear upon the books and records of the Company at least ten (10) calendar days prior to the applicable record or effective date thereinafter specified.
Section 12. Severability. If any provision of this Certificate of Designation is invalid, illegal or unenforceable, the balance of this Certificate of Designation shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances.
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IN WITNESS WHEREOF, the undersigned, being duly authorized thereto, does hereby affirm that this certificate is the act and deed of the Company and that the facts herein stated are true, and accordingly has hereunto set his hand this day of , .
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