exh99_1.htm

	March 31,
	2014		2015
Cash Flows From Operating Activities:
Net income:	$	19,833	$	26,284
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		25,208		25,066
Amortization of debt discount		-		(335)
Amortization of prepaid lease rentals		410		1,228
Amortization and write-off of financing costs		1,872		472
Amortization of deferred dry-docking and special survey		1,898		1,825
Equity based payments		-		2,634
Net settlements on interest rate swaps qualifying for cash flow hedge		(487)		-
Gain on derivative instruments, net		(2,774)		(544)
Equity loss on investments		2,278		195
Changes in operating assets and liabilities:
Accounts receivable		5,031		813
Due from related parties		2,297		(354)
Inventories		(1,086)		1,130
Insurance claims receivable		(823)		(260)
Prepayments and other		(1,020)		(2,045)
Accounts payable		1,880		(182)
Accrued liabilities		(1,166)		265
Unearned revenue		231		116
Other current liabilities		(715)		(227)
Dry-dockings		(1,642)		(1,802)
Accrued charter revenue		2,646		627
Net Cash provided by Operating Activities		53,871		54,906
Cash Flows From Investing Activities:
Investment in affiliates		(24,485)		(12,963)
Advances for vessel acquisitions		(40,630)		-
Vessels acquisitions / Additions to vessel cost		(23)		(443)
Net Cash used in Investing Activities		(65,138)		(13,406)
Cash Flows From Financing Activities:
Capital lease proceeds		171,144		-
Capital lease repayment		(679)		(3,268)
Offering proceeds, net of related expenses		96,523		-
Repayment of long-term debt		(147,479)		(49,954)
Payment of financing costs		(1,413)		-
Dividends paid		(21,149)		(24,022)
Decrease in restricted cash		4,560		6,903
Net Cash provided by / (used in) Financing Activities		101,507		(70,341)
Net increase / (decrease) in cash and cash equivalents		90,240		(28,841)
Cash and cash equivalents at beginning of the period		93,379		113,089
Cash and cash equivalents at end of the period	$	183,619	$	84,248
Supplemental Cash Information:
Cash paid during the period for interest	$	11,313	$	12,254

The accompanying notes are an integral part of these unaudited consolidated financial statements.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

1. Basis of Presentation and General Information:

The accompanying consolidated financial statements include the accounts of Costamare Inc. (“Costamare”) and its wholly-owned subsidiaries (collectively, the “Company”). Costamare was formed on April 21, 2008, under the laws of the Republic of the Marshall Islands.

Costamare was incorporated as part of a reorganization to acquire the ownership interest in 53 ship-owning companies owned by the Konstantakopoulos family (Vasileios Konstantakopoulos and his three sons Messrs. Konstantinos Konstantakopoulos, Achillefs Konstantakopoulos and Christos Konstantakopoulos, together the “Family”). The reorganization was completed in November 2008. On November 4, 2010, Costamare completed its initial public offering (“Initial Public Offering”) in the United States under the United States Securities Act of 1933, as amended (the “Securities Act”). On March 27, 2012 and on October 19, 2012, the Company completed two follow-on public offerings in the United States under the Securities Act and issued 7,500,000 shares and 7,000,000 shares, respectively, par value $0.0001, at a public offering price of $14.10 per share and $14.00 per share, respectively, increasing the issued share capital to 74,800,000 shares. On March 31, 2015, the Company issued 149,600 shares to Costamare Shipping Company S.A. (Note 3) pursuant to the amended and restated group management agreement, increasing the issued share capital to 74,949,600 shares. At March 31, 2015, members of the Family owned, directly or indirectly, approximately 64.8% of the outstanding common shares, in the aggregate. Furthermore, on August 7, 2013, the Company completed a public offering of 2,000,000 shares of its 7.625% Series B Cumulative Redeemable Perpetual Preferred Stock (the “Series B Preferred Stock”), par value $0.0001, at a public offering price of $25.00 per share and on January 21, 2014, the Company completed a public offering of 4,000,000 shares of its 8.50% Series C Cumulative Redeemable Perpetual Preferred Stock (the “Series C Preferred Stock”), par value $0.0001, at a public offering price of $25.00 per share.

As of December 31, 2014 and March 31, 2015, the Company owned and/or operated a fleet of 55 and 55 container vessels, respectively, with a total carrying capacity of approximately 320,407 TEU and 320,407 TEU, respectively, through wholly-owned subsidiaries incorporated in the Republic of Liberia. The Company provides worldwide marine transportation services by chartering its container vessels to some of the world’s leading liner operators under long, medium and short-term time charters.

At March 31, 2015, Costamare had 92 wholly-owned subsidiaries, all incorporated in the Republic of Liberia, except for five incorporated in the Republic of the Marshall Islands.

On October 2, 2014, Costamare Partners LP (the “MLP”), a Marshall Islands limited partnership and a wholly owned subsidiary of the Company, filed a Registration Statement on Form F-1 with the SEC (which registration statement was subsequently amended and re-filed on October 23, 2014, November 12, 2014 and January 30, 2015) for the initial public offering of common units representing limited partnership interests (the “common units”) in the MLP. The number of common units to be offered and the price range for the offering have not yet been finally determined. The proceeds from the offering are expected to be used principally to reduce indebtedness and for general partnership purposes, with the remainder to be distributed to the Company. If the offering is completed, the Company expects to contribute to the MLP a 100% interest in the entities which own four of the Company’s existing container vessels. Following the offering, the MLP will remain a consolidated subsidiary of the Company as the Company will retain a majority of the MLP’s total equity interests and, through a subsidiary, act as its general partner. Completion of the initial public offering is subject to further authorization of the board of directors of the Company, as well as completion of the SEC review process.

Revenues for the three month periods ended March 31, 2014 and 2015, derived from significant charterers individually accounting for 10% or more of revenues (in percentages of total revenues) were as follows:

	2014	2015
A	28%	26%
B	25%	31%
C	15%	14%
D	19%	18%
Total	87%	89%

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and applicable rules and regulations of the Securities and Exchange Commission ("SEC") for interim financial information. Accordingly, they do not include all the information and notes required by U.S. GAAP for annual financial statements. These statements and the accompanying notes should be read in conjunction with the Company's Annual Report on Form 20-F for the fiscal year ended December 31, 2014, filed with the SEC on March 5, 2015.

These unaudited interim condensed consolidated financial statements have been prepared on the same basis as the Company's annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting of only normal recurring adjustments, considered necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the periods presented. Operating results for the three-month period ended March 31, 2015, are not necessarily indicative of the results that might be expected for the fiscal year ending December 31, 2015.

2. Significant Accounting Policies and Recent Accounting Pronouncements:

A discussion of the Company’s significant accounting policies can be found in the Company’s Consolidated Financial Statements included in the Annual Report on Form 20-F for the year ended December 31, 2014. There have been no material changes to these policies in the three-month period ended March 31, 2015, except for the re-assessment of the Company’s estimated scrap rate used to calculate the vessel’s salvage value.

Vessels, Net: Vessels are stated at cost, which consists of the contract price and any material expenses incurred upon acquisition (initial repairs, improvements and delivery expenses, interest and on-site supervision costs incurred during the construction periods). Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels; otherwise these amounts are charged to expense as incurred.

The cost of each of the Company’s vessels is depreciated from the date of acquisition on a straight-line basis over the vessel’s remaining estimated economic useful life, after considering the estimated residual value which is equal to the product of vessels’ lightweight tonnage and estimated scrap rate, which up until December 31, 2014, was estimated to be approximately $0.250 per lightweight ton. In order to align the scrap rate estimates with the current historical average scrap rate, effective from January 1, 2015, the Company adjusted the estimated scrap rate used to calculate the vessels' salvage value from $0.250 to $0.300 per lightweight ton. The impact of the increase in the estimated scrap rate is a decrease in depreciation expense going forward. The effect of this change in accounting estimate, which did not require retrospective adoption as per ASC 250 "Accounting Changes and Error Corrections", was to increase net income for the three-month period ended March 31, 2015, by $1,338 or $0.02 per common share, basic and diluted.

Management estimates the useful life of the Company’s vessels to be 30 years from the date of initial delivery from the shipyard. Secondhand vessels are depreciated from the date of their acquisition through their remaining estimated useful life. When regulations place limitations over the ability of a vessel to trade on a worldwide basis, its remaining useful life is adjusted at the date such regulations are adopted.

New accounting pronouncements

Debt issuance costs: In April 2015, Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03 – Interest – Imputation of Interest to simplify the presentation of debt issuance costs. Current guidance generally requires entities to capitalize costs paid to third parties that are directly related to issuing debt and that otherwise wouldn’t be incurred and present those amounts separately as deferred charges (i.e., assets). However, the discount or premium resulting from the difference between the net proceeds received upon debt issuance and the amount payable at maturity is presented as a direct deduction from or an addition to the face amount of the debt. The new guidance simplifies financial reporting by eliminating the different presentation requirements for debt issuance costs and debt discounts or premiums.

The guidance is effective for public business entities for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Upon adoption, an entity must apply the new guidance retrospectively to all prior periods presented in the financial statements. Early adoption is permitted. The Company is planning to apply ASU No. 2015-03 as of January 1, 2016.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

3. Transactions with Related Parties:

(a) Costamare Shipping Company S.A. (the “Manager” or “Costamare Shipping”): Costamare Shipping is a ship management company wholly-owned by Mr. Konstantinos Konstantakopoulos, the Company’s Chief Executive Officer and, as such, is not part of the consolidated group of the Company, but is a related party. Costamare Shipping provides the Company with general administrative services, certain commercial services, director and officer related insurance services and the services of the Company’s officers.

Costamare Shipping, itself or through Shanghai Costamare Ship Management Co., Ltd. (“Shanghai Costamare”), which is also controlled by Mr. Konstantakopoulos, or through or together with third party sub-managers, provides technical, crewing, commercial, provisioning, bunkering, sale and purchase, chartering, accounting, insurance and administrative services in exchange for a daily fee for each containership. Up to April 2013, Costamare Shipping also provided such services through Ciel Shipmanagement S.A. (“CIEL”), another company controlled by Mr. Konstantakopoulos. We refer to Costamare Shipping and Shanghai Costamare and, up to April 2013, CIEL as the Company’s “affiliated managers”.

On March 3, 2015, the Company entered into an amended and restated management agreement with Costamare Shipping (the “Group Management Agreement”) which, among other things, extends the term of the agreement such that it automatically renews for 10 consecutive one-year periods until December 31, 2025 (rather than five consecutive periods until December 31, 2020), removes the annual 4% increase of the fee payable in respect of each containership managed by Costamare Shipping and in respect of the flat fee for the supervision of each newbuild ordered by the Company and, beginning in the first quarter of 2015, provides for an annual fee to Costamare Shipping of $2,500 and 598,400 shares (which is equal to 0.8% of the issued and outstanding Company's common stock as of January 1, 2015) payable quarterly in arrears. No separate payment is made for the services of the Company’s executive officers (prior to 2015, the Company paid Costamare Shipping $1,000 annually for such services).

In 2015, Costamare Shipping is to receive (i) for each containership which is not subject to a bareboat charter a daily fee of $0.956 since January 1, 2015 ($0.919 for 2014) and for each containership subject to a bareboat charter a daily fee of $0.478 since January 1, 2015 ($0.460 for 2014), in each case prorated for the calendar days the Company owned each containership and for the three-month period following the date of the sale of a vessel, (ii) a flat fee of $787.4 for the supervision of the construction of any newbuild vessel contracted by the Company, (iii) a fee of 0.75% on all gross freight, demurrage, charter hire, ballast bonus or other income earned with respect to each containership in the Company’s fleet and, (iv) an annual fee of $2,500 and 598,400 shares as noted above. Fees under (i) and (ii) may be annually adjusted upwards to reflect any strengthening of the Euro against the U.S. dollar and/or material unforeseen cost increases.

After the initial term which expires on December 31, 2015, the Company will be able to terminate the management agreement, subject to a termination fee, by providing written notice to Costamare Shipping at least 12 months before the end of the subsequent one-year term. The termination fee is equal to (a) the lesser of (i) ten and (ii) the number of full years remaining prior to December 31, 2020, times (b) the aggregate fees due and payable to Costamare Shipping during the 12-month period ending on the date of termination; provided that the termination fee will always be at least two times the aggregate fees over the 12-month period described above.

On January 7, 2013, Costamare Shipping entered into a co-operation agreement (the “Co-operation Agreement”) with third-party ship managers V.Ships Greece Ltd. (“V.Ships Greece”), pursuant to which the two companies established a ship management cell (the “Cell”) under V.Ships Greece. Since April 2013, the Cell provides technical, crewing, provisioning, bunkering, sale and purchase and accounting services, as well as certain commercial and insurance services to certain of the Company’s container vessels (including all container vessels previously managed by CIEL), pursuant to separate management agreements entered into between V.Ships Greece and the ship-owning company of the respective container vessel, for a daily management fee. Costamare Shipping remains the head manager for all vessels owned by the Company.

The Cell also offers ship management services to third-party owners. Costamare Shipping passes to the Company the net profit, if any, it receives pursuant to the Co-operation Agreement as a refund or reduction of the management fees payable by the Company to Costamare Shipping under the Group Management Agreement. As at March 31, 2015, the Cell provided technical, crewing, provisioning, bunkering, sale and purchase and accounting services, as well as certain commercial management services to 19 of Costamare’s vessels.

Management fees charged by the Manager in the three month periods ended March 31, 2014 and 2015, amounted to $4,417 and $4,764, respectively and are included in Management fees-related parties in the accompanying consolidated statements of income. In addition, the Manager charged (i) $905 for the three-month period ended March 31, 2015 ($862 for the three-month period ended March 31, 2014), representing a fee of 0.75% on all gross revenues, as provided in the management agreements with each subsidiary, which is separately reflected as Voyage expenses-related parties in the accompanying consolidated statements of income for the three month periods ended March 31, 2014 and 2015, respectively, (ii) $625, which is included in General and administrative expenses – related parties in the accompanying consolidated statements of income for the three month period ended March 31, 2015 ($250 for the three month period ended March 31, 2014), (iii) $2,634 representing the fair value of 149,600 shares, which is separately reflected in General and administrative expenses - related parties in the accompanying consolidated statements of income for the three month period ended March 31, 2015 and (iv) $1,050 supervision fees for three newbuild vessels, which were included in Advances for vessels acquisition during 2014. Furthermore, in accordance with the management agreement with V.Ships Greece, V.Ships Greece has been provided with the amount of $1,425 ($75 per vessel) as working capital security, which is included in Accounts receivable, non-current, net, in the accompanying consolidated balance sheets.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

During the three month periods ended March 31, 2015 and 2014, the Manager charged in aggregate to the companies established pursuant to the Framework Agreement (Notes 8 and 9) the amount of $416 and $342, respectively for services provided in accordance with the respective management agreements.

The balance due from the Manager at December 31, 2014 and at March 31, 2015 amounted to $576 and $971, respectively, which are included in Due from related parties in the accompanying consolidated balance sheets.

(b) Ciel Shipmanagement S.A.: CIEL, a company incorporated in the Republic of Liberia, is wholly-owned, effective November 30, 2012, by Mr. Konstantinos Konstantakopoulos, the Company’s Chairman and Chief Executive Officer (prior to November 30, 2012, Mr. Konstantinos Konstantakopoulos owned 50.2% and Mr. Dimitrios Lemonidis owned 49.8% of CIEL). CIEL was not part of the consolidated group of the Company but was an affiliated manager up to April 2013. CIEL, up to April 2013, provided the Company’s vessels certain ship management services such as technical support and maintenance, financial and accounting services, under separate management agreements signed between CIEL and each ship-owning company, in exchange for a daily fixed fee of $0.600 per vessel. CIEL specialized, although not exclusively, in managing containerships of up to 3,500 TEU. For the period from April 28, 2013 to December 31, 2014 and for the three month period ended March 31, 2015, CIEL did not provide technical, crewing, provisioning, bunkering, sale and purchase and accounting services, or other commercial services, to any of the Company’s containerships. CIEL is currently providing services in respect of the Rena. Management fees charged by CIEL in the three month period ended March 31, 2014 and 2015, amounted to $54 and $54, respectively and are included in Management fees-related parties in the accompanying consolidated statements of income. The balance due from CIEL at December 31, 2014 and March 31, 2015, amounted to $593 and $591, respectively and is included in Due from related parties in the accompanying consolidated balance sheets.

(c) Shanghai Costamare Ship Management Co. Ltd.: Shanghai Costamare is owned (indirectly) 70% by the Company’s Chairman and Chief Executive Officer and 30% (indirectly) by Shanghai Costamare’s General Manager, Mr. Shen Xiao Dong. Shanghai Costamare is a company incorporated in the Peoples’ Republic of China in September 2004 and is not part of the consolidated group of the Company but is an affiliated manager. The technical, crewing, provisioning, bunkering, sale and purchase and accounting services, as well as certain commercial services of certain of the Company’s vessels have been subcontracted from the Manager to Shanghai Costamare. As of March 31, 2015, Shanghai Costamare provided such services to eleven (eleven as of December 31, 2014) of the Company’s containerships. There was no balance due from/to Shanghai Costamare at both December 31, 2014 and March 31, 2015.

4. Other non-current assets:

As of July 16, 2014, Zim Integrated Services (“Zim”) and its creditors including vessel and container lenders, ship-owners, shipyards, unsecured lenders and bond holders, entered into definitive documentation to restructure its debt. Based on this agreement, the Company received equity securities representing 1.2% of Zim’s equity and $8,229 aggregate principal amount of unsecured interest bearing Zim notes maturing in 2023 consisting of $1,452 of 3.0% Series 1 Notes due 2023 amortizing subject to available cash flow in accordance with a corporate mechanism and $6,777 of 5.0% Series 2 Notes due 2023 non-amortizing (of the 5% interest, 3% is payable quarterly in cash and 2% interest is accrued quarterly with deferred cash payment on maturity) in exchange for amounts owed by Zim to the Company under their charter agreements. The Company calculated the fair value of the instruments received by Zim based on the agreement discussed above, available information on Zim, other similar contracts with similar terms, maturities and interest rates, and recorded at fair value $676 in relation to the Series 1 Notes, $3,567 in relation to the Series 2 Notes and $7,802 in relation to its equity participation in Zim. The difference between the aggregate fair value of the debt and equity securities received from Zim and the then net carrying value of the amounts due from Zim of $2,888 was written-off and was included in General and administrative expenses in the 2014 consolidated statement of income.

On a quarterly basis, the Company will account for the fair value unwinding of the Series 1 and Series 2 Notes, until the book value of the instruments equals their face value on maturity. During the three-month period ended March 31, 2015, the Company recorded $335 in relation to their fair value unwinding, which is included in “Interest income” in the consolidated statement of income for the three-month period ended March 31, 2015. The Company has classified such debt and equity securities under other non-current assets, since it has no intention to sell the securities in the near term. The Series 1 and Series 2 Zim Notes are carried at amortized cost in the accompanying consolidated balance sheet as at March 31, 2015, which approximates their fair value as of such date. These financial instruments are not measured at fair value on a recurring basis. As of March 31, 2015, the Company has assessed for other than temporary impairment of its investment in Zim and has concluded that no impairment existed.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

5. Inventories:

Inventories of $11,565 and $10,435 in the accompanying balance sheets at December 31, 2014 and March 31, 2015, respectively relate to lubricants and spare parts.

6. Vessels, Net:

The amounts in the accompanying consolidated balance sheets are analyzed as follows:

	Vessel Cost		Accumulated Depreciation			Net Book Value
Balance, December 31, 2014		2,953,440		(854,620	)		2,098,820
Depreciation		-		(23,169	)		(23,169	)
Other vessels’ costs		443		-			443
Balance, March 31, 2015		2,953,883		(877,789	)		2,076,094

On September 21, 2010, the Company through its three wholly-owned subsidiaries, Adele Shipping Co., Bastian Shipping Co. and Cadence Shipping Co., contracted with a shipyard for the construction and purchase of three newbuild vessels (Hulls H1068A, H1069A and H1070A), each of approximately 9,403 TEU capacity at a contract price per newbuild vessel of $95,080. The newbuilds MSC Azov (Hull H1068A), MSC Ajaccio (Hull H1069A) and MSC Amalfi (Hull H1070A) were delivered to the Company on January 14, 2014, March 14, 2014 and April 28, 2014, respectively. The Company agreed with a financial institution to refinance the then outstanding balance of the loan relating to MSC Azov, MSC Ajaccio and MSC Amalfi under a ten-year sale and leaseback transaction. Under the sale and leaseback transaction, the vessels were chartered back to the Company on a bareboat basis and remained on time charter with its initial time charterer (Note 11).

Furthermore, during the year ended December 31, 2014, the Company acquired the three secondhand vessels Neapolis, Areopolis and Lakonia at an aggregate price of $27,740.

As of March 31, 2015, one of the Company’s vessel, having total carrying value of $2,963 was fully depreciated.

Forty-six of the Company’s vessels, with a total carrying value of $1,918,189 as of March 31, 2015, have been provided as collateral to secure the long-term debt discussed in Note 10.

7. Deferred Charges:

The amounts in the accompanying consolidated balance sheets are analyzed as follows:

	Financing Costs			Dry-docking and Special Survey Costs			Total
Balance, December 31, 2014		7,902			20,773			28,675
Additions		-			1,802			1,802
Amortization		(472	)		(1,825	)		(2,297	)
Balance, March 31, 2015		7,430			20,750			28,180

Financing costs represent fees paid to the lenders for the conclusion of the Company’s financing. The amortization of loan financing costs is included in interest and finance costs in the accompanying consolidated statements of income (Note 16).

During the three month periods ended March 31, 2014 and 2015, two and two vessels, respectively underwent and completed their special surveys. The amortization of the dry-docking and special survey costs is separately reflected in the accompanying consolidated statements of income.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

8. Costamare Ventures Inc.:

On May 15, 2013, the Company, along with its wholly-owned subsidiary, Costamare Ventures Inc. (“Costamare Ventures”), entered into a Framework Deed (the “Framework Agreement”) with York Capital Management Global Advisors LLC and its affiliate Sparrow Holdings, L.P. (collectively, “York”) to invest jointly in the acquisition and construction of container vessels. Under the Framework Agreement the decisions regarding vessel acquisitions will be made jointly by Costamare Ventures and York and the Company reserves the right to acquire any vessels that York decides not to pursue.

Under the terms of the Framework Agreement, York agreed to invest up to $250 million in mutually agreed vessel acquisitions and Costamare Ventures agreed to invest a minimum of $75 million with an option to invest up to $240 million in these transactions. Depending on the amount Costamare Ventures elects to invest, it is expected that it will hold between 25% and 49% of the equity in the entities that will be formed under the Framework Agreement (the “affiliate ship-owning companies”) and York will hold the balance. Costamare Shipping provides shipmanagement and administrative services to the vessels acquired under the Framework Agreement, with the right to subcontract to V.Ships Greece and/or Shanghai Costamare. The Framework Agreement will terminate on its sixth anniversary or upon the occurrence of certain extraordinary events as described therein. At that time, Costamare Ventures may elect to divide the vessels owned by all such vessel-owning entities between itself and York to reflect their cumulative participation in all such entities. The Company accounts for the entities formed under the Framework Agreement as equity investments. As at March 31, 2015, the Company holds a range of 25% to 49% of the capital stock of fifteen jointly-owned companies formed pursuant to the Framework Agreement with York (Note 9).

9. Investment in Affiliates:

The affiliate companies, all of which are incorporated in the Marshall Islands and are accounted for under the equity method, are as follows:

		Participation %	Date Established
Entity	Vessel/Hull	December 31, 2014	/Acquired
Steadman Maritime Co.	Ensenada Express	49%	July 1, 2013
Marchant Maritime Co.	X-Press Padma	49%	July 8, 2013
Horton Maritime Co.	Petalidi	49%	June 26, 2013
Smales Maritime Co.	Elafonisos	49%	June 6, 2013
Kemp Maritime Co.	Hull NCP0113	49%	June 6, 2013
Hyde Maritime Co.	Hull NCP0114	49%	June 6, 2013
Skerrett Maritime Co.	Hull NCP0152	49%	December 23, 2013
Ainsley Maritime Co.	Hull NCP0115	25%	June 25, 2013
Ambrose Maritime Co.	Hull NCP0116	25%	June 25, 2013
Benedict Maritime Co.	Hull HN2121	40%	October 16, 2013
Bertrand Maritime Co.	Hull HN2122	40%	October 16, 2013
Beardmore Maritime Co.	Hull HN2123	40%	December 23, 2013
Schofield Maritime Co.	Hull HN2124	40%	December 23, 2013
Fairbank Maritime Co.	Hull HN2125	40%	December 23, 2013
Connell Maritime Co.	n/a	40%	December 18, 2013

On July 12, 2013, in accordance with the Framework Agreement, York contributed $16,044, in the aggregate, in order to acquire a 51% equity interest in the affiliate ship-owning companies Steadman Maritime Co., Marchant Maritime Co. and Horton Maritime Co., and for initial working capital of such affiliate ship-owning companies. There was no difference between: (a) the aggregate of the fair value of the consideration received and the fair value of the retained investment, as compared with (b) the carrying amount of the former subsidiaries assets and liabilities, in each case at the date the subsidiaries were deconsolidated.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

Furthermore, in July 2013, Costamare Ventures participated with 49% in the equity of Kemp Maritime Co. and Hyde Maritime Co. who entered into ship-building contracts for the construction of two 9,000 TEU container vessels, subject to upgrade, by contributing $34,709, in the aggregate during the year ended December 31, 2014 and $149 in aggregate during the three month period ended March 31, 2015.

During the year ended December 31, 2014 and the three month period ended March 31, 2015, Costamare Ventures participated with 25% in the equity of Ainsley Maritime Co. and Ambrose Maritime Co., who entered into ship-building contracts for the construction of two 11,000 TEU container vessels, by contributing $8,767 and $13,034 in the aggregate, respectively.

Furthermore, during the year ended December 31, 2014, Costamare Ventures participated with 40% in the equity of Benedict Maritime Co., Bertrand Maritime Co., Beardmore Maritime Co., Schofield Maritime Co. and Fairbank Maritime Co., who entered into ship-building contracts for the construction of five 14,000 TEU container vessels, by contributing $30,305, in the aggregate. In December 2014, these five companies novated their ship-building contracts to a financial institution and agreed to lease back the vessels upon their delivery from the shipyard for a period of 12 years. During the three month period ended March 31, 2015, Costamare Ventures contributed $29 in the aggregate to such companies.

During the year ended December 31, 2014, Costamare Ventures participated with 40% in the equity of Connell Maritime Co. by contributing the amount of $6,669 and with 49% in the equity of Smales Maritime Co. by contributing the amount of $4,654 for the acquisition of the secondhand vessel Elafonisos.

In March 2015, Costamare Ventures participated with 49% in the equity of Skerrett Maritime Co., which entered into a ship-building contract for the construction of an 11,000 TEU container vessel.

For three month periods ended March 31, 2014 and 2015, the Company recorded net losses of $2,278 and $195, respectively, which are separately reflected as Equity loss on investments in the accompanying consolidated statements of income.

Furthermore, during the year ended December 31, 2014, eight affiliate ship-owning companies declared dividends to their shareholders and Costamare Ventures received the amount of $31,828, which is included in Investments in affiliates in the accompanying 2014 consolidated balance sheet.

In addition, Costamare Ventures has provided Marchant Maritime Co., Horton Maritime Co. and Steadman Maritime Co. with certain cash advances. As of December 31, 2014 and March 31, 2015, the aggregate balance due from the three companies, amounted to $3,278 and $3,239, respectively and are included in Due from related parties in the accompanying consolidated balance sheets.

The summarized combined financial information of the affiliates is as follows:

	December 31, 2014			March 31, 2015
Non-current assets		177,220			229,072
Current assets		13,267			11,534
		190,487			240,606

Current liabilities		6,283			5,349

	Three-month period ended March 31,
		2014			2015
Voyage revenue		2,888			3,595
Net income / (loss)		(5,852	)		(668	)

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

10. Long-Term Debt:

The amounts shown in the accompanying consolidated balance sheets consist of the following:

Borrower(s)			December 31, 2014			March 31, 2015
1.	Credit Facility		585,883			563,411
2.	Term Loans:
	1	Costis Maritime Corporation and Christos Maritime Corporation	91,500			91,500
	2	Mas Shipping Co.	38,875			34,750
	3	Montes Shipping Co. and Kelsen Shipping Co.	78,000			78,000
	4	Capetanissa Maritime Corporation	50,000			47,500
	5	Rena Maritime Corporation		47,500		45,000
	6	Costamare Inc.		73,414		70,409
	7	Adele Shipping Co., Bastian Shipping Co. and Cadence Shipping Co.		-		-
	8	Costamare Inc.		120,330		115,873
	9	Undine Shipping Co., Quentin Shipping Co. and Sander Shipping Co.		208,826		205,005
	10	Raymond Shipping Co. and Terance Shipping Co.		137,793		135,064
	11	Costamare Inc.		87,820		83,475
				934,058		906,576
		Total		1,519,941		1,469,987
		Less-current portion		(192,951	)	(190,853	)
		Long-term portion		1,326,990		1,279,134

1. Credit Facility: On July 22, 2008, the Company signed a loan agreement with a consortium of banks, for a $1,000,000 Credit Facility (the “Facility”) for general corporate and working capital purposes. The Company used $631,340 of the proceeds from the Facility to repay the then existing indebtedness. The Facility bears interest at the 3, 6, 9 or 12 months (at the Company’s option) LIBOR plus margin. Following the sale of MSC Antwerp (ex. Sophia Britannia) the Company, on September 30, 2013, repaid $1,500 of the Facility.

The outstanding balance of the Facility as of March 31, 2015, is repayable in 13 equal, consecutive quarterly installments, of $22,473 each plus a balloon payment of $271,262 payable together with the last installment. The quarterly installments were calculated using a formula specified in the agreement, following the amalgamation of the Facility’s compounds on June 30, 2011, as documented in the third supplemental agreement to the Facility that the Company entered into on September 6, 2011.

On December 17, 2012, the Company entered into a fourth supplemental agreement which released two of the Company’s subsidiaries guarantors and the mortgages over their vessels and replaced them with mortgages over two other vessels. On May 28, 2013, the Company entered into a fifth supplemental agreement under which the bank agreed to the change of flags of five of the Company’s vessels and to the transfer of the technical management of two of the Company’s vessels to V.Ships Greece. On August 30, 2013, the Company entered into a sixth supplemental agreement which released one of the Company’s subsidiary guarantor and the mortgage over its vessel and replaced it with mortgages over two other vessels. On July 2, 2014, contemporaneously with the restructuring with a major charterer discussed above (Note 4), the Company entered into a seventh supplemental agreement which amends the calculation method of the security value maintenance of the original agreement for two of the vessels financed by the Credit Facility which are chartered with the specific charterer.

The Facility, as of March 31, 2015, was secured with, among others, first priority mortgages over 18 of the Company’s vessels, first priority assignment of vessels’ insurances and earnings, charter party assignments, first priority pledges over the operating accounts and corporate guarantees of 18 ship-owning companies.

The Facility and certain of the term loans described under Note 10.2 below include among others, financial covenants requiring: (i) the ratio of Total Liabilities (after deducting cash and cash equivalents) to Market Value Adjusted Total Assets (after deducting cash and cash equivalents) not to exceed 0.75 to 1.00, (ii) minimum liquidity of the greater of $30,000 or 3% of the total debt of the Company, (iii) the ratio of EBITDA to net interest expense not to be less than 2.50 to 1.00, (iv) Market Value Adjusted Net Worth, defined as the amount by which the Market Value Adjusted Total Assets exceed the Total Liabilities, to exceed $500,000. The Company’s other term loans described under Note 10.2 below also contain financial covenants requiring the ratio of net funded debt to total net assets ratio not to exceed 80% on a charter inclusive valuation basis as well as financial covenants that are either equal to or less stringent than the foregoing financial covenants.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

2. Term loans:

1. In May 2008, Costis Maritime Corporation and Christos Maritime Corporation entered into a loan agreement with a bank for an amount of up to $150,000 in the aggregate ($75,000 each) on a joint and several basis in order to partly finance the acquisition cost of the vessels Sealand New York and Sealand Washington. As at March 31, 2015, the outstanding balance of the loan of $91,500 is repayable in 7 equal semi-annual installments of $4,500, each from May 2015 to May 2018 and a balloon payment of $60,000 payable together with the last installment.

2. In January 2008, Mas Shipping Co. entered into a loan agreement with a bank for an amount of up to $75,000 in order to partly finance the acquisition cost of vessel Maersk Kokura. As at March 31, 2015, the outstanding balance of the loan of $34,750 is repayable in 6 variable semi-annual installments from August 2015 to February 2018 and a balloon payment of $10,000 payable together with the last installment.

3. In December 2007, Montes Shipping Co. and Kelsen Shipping Co. entered into a loan agreement with a bank for an amount of up to $150,000 in the aggregate ($75,000 each) on a joint and several basis in order to partly finance the acquisition cost of the vessels Maersk Kawasaki and Maersk Kure. As at March 31, 2015, the outstanding balance of the loan of $78,000 is repayable in 6 equal semi-annual installments of $6,000 each from June 2015 to December 2017 and a balloon payment of $42,000 payable together with the last installment.

4. In June 2006, Capetanissa Maritime Corporation entered into a loan agreement with a bank for an amount of up to $90,000, in order to partly finance the acquisition cost of the vessel Cosco Beijing. As at March 31, 2015, the outstanding balance of the loan of $47,500 is repayable in 7 equal semi-annual installments of $2,500 each from August 2015 to August 2018 and a balloon payment of $30,000 payable together with the last installment.

5. In February 2006, Rena Maritime Corporation entered into a loan agreement with a bank for an amount of up to $90,000 in order to partly finance the acquisition cost of the vessel Cosco Guangzhou. As at March 31, 2015, the outstanding balance of the loan of $45,000 is repayable in 6 equal semi-annual installments of $2,500 each from August 2015 to February 2018 and a balloon payment of $30,000 payable together with the last installment.

6. On November 19, 2010, Costamare entered into a term loan agreement with a consortium of banks for an amount of up to $120,000, which was available for drawing for a period up to 18 months. As of March 31, 2015, the Company had drawn the amount of $38,500 (tranche a), the amount of $42,000 (tranche b), the amount of $21,000 (tranche c), the amount of $7,470 (tranche d) and the amount of $7,470 (tranche e) under this term loan agreement in order to finance part of the acquisition cost of MSC Romanos, MSC Methoni, MSC Ulsan, MSC Koroni (ex. Koroni) and MSC Itea (ex. Kyparissia), respectively. As at March 31, 2015, the outstanding balance of the tranche (a) of the loan of $25,025 is repayable in 18 equal quarterly installments of $962.5 from May 2015 to August 2019 and a balloon payment of $7,700 payable together with the last installment. As at March 31, 2015, the outstanding balance of the tranche (b) of the loan of $28,350 is repayable in 19 equal quarterly installments of $1,050 from April 2015 to October 2019 and a balloon payment of $8,400 payable together with the last installment. As at March 31, 2015, the outstanding balance of the tranche (c) of the loan of $14,700 is repayable in 20 equal quarterly installments of $525 from May 2015 to February 2020 and a balloon payment of $4,200 payable together with the last installment. On May 21, 2014, the then outstanding balance of $4,202 of the tranche (d) of the loan was fully repaid. As at March 31, 2015, the outstanding balance of the tranche (e) of the loan of $2,334 is repayable in one final installment of $466.9 on May 2015 and a balloon payment of $1,867.1 payable together with the last installment.

7. On January 14, 2011, Adele Shipping Co., Bastian Shipping Co. and Cadence Shipping Co., wholly-owned subsidiaries of Costamare, concluded a credit facility with a consortium of banks, as joint-and-several borrowers, for an amount of up to $203,343 to finance part of the acquisition and construction cost of Hulls H1068A, H1069A and H1070A. The drawdown of the facility was made in three tranches, one for each hull. The credit facility was repayable in forty consecutive quarterly installments, the first thirty-nine (1-39) in the amount of $1,412 per tranche each, and a final (fortieth) installment of $12,713 per tranche. As of December 31, 2013, the Company had drawn the amount of $48,765 (tranche (a) - H1068A), $48,765 (tranche (b) - H1069A) and $48,765 (tranche (c) - H1070A), in order to partly finance the second installment and fully finance the third and fourth pre- delivery installment of hulls H1068A, H1069A and H1070A. MSC Azov (Hull H1068A), MSC Ajaccio (Hull H1069A) and MSC Amalfi (Hull H1070A) were delivered to the Company, on January 14, 2014, March 14, 2014 and April 28, 2014, respectively and at the same time the Company agreed the sale and leaseback of such vessels and repaid the then outstanding balance of the three tranches (Note 11).

8. On April 7, 2011, Costamare, as borrower, concluded a credit facility with a bank, for an amount up to the lesser of $140,000 and 70% of the contract price of the vessels, to finance part of the acquisition and construction cost of Hulls S4010 and S4011. In April 2011, the Company drew down the amount of $26,740 in order to partly refinance the first pre-delivery installment of Hulls S4010 and S4011. During the year ended December 31, 2012, the Company drew down the amount of $26,740, in aggregate, in order to partly finance the second and third pre-delivery installments of Hulls S4010 and S4011. Furthermore, during the year ended December 31, 2013, the Company drew down in aggregate the amount of $80,220, in order to partly finance the final installments of Hulls S4010 (MSC Athens), which was delivered to the Company on March 14, 2013 and S4011 (MSC Athos), which was delivered to the Company on April 8, 2013. As at March 31, 2015, the outstanding balance of the loan of $115,873 is repayable in 12 equal semi-annual installments of $4,456.7 from July 2015 until January 2021 and a balloon payment of $62,392.7 payable together with the last installment.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

9. On August 16, 2011, Undine Shipping Co., Quentin Shipping Co. and Sander Shipping Co., wholly-owned subsidiaries of Costamare concluded a credit facility with a consortium of banks, as joint-and-several borrowers, for an amount of up to $229,200 to finance part of the acquisition and construction cost of Hulls S4020, S4022 and S4024. The drawdown of the facility was made in three tranches. On August 26, 2011, the Company drew down an amount of $22,920 in order to partly refinance the first pre-delivery installment of Hulls S4020, S4022 and S4024. During the year ended December 31, 2012, the Company drew down in aggregate the amount of $38,200 in order to partly finance the second and the third pre-delivery installments of Hulls S4020, S4022 and S4024. Furthermore, during the year ended December 31, 2013, the Company drew down in aggregate the amount of $168,080 in order to partly finance the third pre-delivery and the delivery final installments of Hulls S4020 (Valor), S4022 (Valiant) and S4024 (Vantage), which were delivered to the Company on June 3, 2013, August 5, 2013 and November 8, 2013, respectively. As at March 31, 2015, the outstanding balance of the tranche (a) of $67,486 relating to Hull S4020 (Valor), is repayable in 21 equal quarterly installments of $1,273.4 from April 2015 to April 2020 and a balloon payment of $40,744.8 payable together with the last installment. As at March 31, 2015, the outstanding balance of the tranche (b) of $67,486 relating to Hull S4022 (Valiant), is repayable in 21 equal quarterly installments of $1,273.4 from June 2015 to June 2020 and a balloon payment of $40,744.8 payable together with the last installment. As at March 31, 2015, the outstanding balance of the tranche (c) of $70,033 relating to Hull S4024 (Vantage) is repayable in 23 equal quarterly installments of $1,273.4 and a balloon payment payable together with the last installment of $40,744.8 from May 2015 to November 2020.

10. On October 12, 2011, Raymond Shipping Co. and Terance Shipping Co. wholly-owned subsidiaries of the Company concluded a credit facility with a bank, as joint and several borrowers, for an amount of up to $152,800 to finance part of the construction and acquisition cost of Hulls S4021 and S4023. On October 25, 2011, the Company drew down an amount of $15,280 in order to partly refinance the first pre-delivery installment of Hulls S4021 and S4023. During the year ended December 31, 2012, the Company drew down in aggregate the amount of $30,560 in order to partly finance the second and third pre-delivery installments of Hulls S4021 and S4023. Furthermore, during the year ended December 31, 2013 the Company drew down in the aggregate the amount $106,960 in order to partly finance the final installments of Hulls S4021 (Value) and S4023 (Valence), which vessels were delivered to the Company on June 25, 2013, and September 2, 2013, respectively. As at March 31, 2015, the outstanding balance of the tranche (a) of $66,850 relating to Hull S4021 (Value), is repayable in 21 equal quarterly installments of $1,364.3 from June 2015 to June 2020 and a balloon payment of $38,199.6 payable together with the last installment. As at March 31, 2015, the outstanding balance of tranche (b) of the loan of $68,214 relating to Hull S4023 (Valence) is repayable in 22 equal quarterly installments of $1,364.3 from May 2015 to August 2020 and a balloon payment of $38,199.6 payable together with the last installment.

11. On October 6, 2011, the Company concluded a loan facility with a bank for an amount of up to $120,000, in order to partly finance the aggregate market value of eleven vessels in its fleet. In March 2012, the Company drew the amount of $113,700. Furthermore, on June 29, 2012, the Company entered into a supplemental agreement for a further amount of $11,300 to finance the acquisition of the vessel Stadt Luebeck, which was drawn down in August 2012 upon the delivery of the vessel. In April 11, 2014, the Company entered into another supplemental agreement, for a further amount of $9,000 to partly finance the acquisition of the vessel Neapolis, which was drawn down in April 2014 upon the delivery of the vessel. In May 2014, the Company repaid the amount of $6,495 due to the sale of Konstantina. Furthermore in September 2014 the Company repaid the amount of $6,000 due to the sale of Akritas. As at March 31, 2015, the outstanding balance of $83,475 is repayable in 15 quarterly variable consecutive installments from June 2015 to December 2018 and a balloon payment of $39,490 payable together with the last installment.

The term loans discussed above bear interest at LIBOR plus a spread and are secured by, inter alia, (a) first priority mortgages over the financed vessels, (b) first priority assignments of all insurances and earnings of the mortgaged vessels and (c) corporate guarantees of Costamare or its subsidiaries, as the case may be. The loan agreements contain usual ship finance covenants, including restrictions as to changes in management and ownership of the vessels, additional indebtedness, mortgaging of vessels, as well as minimum requirements regarding hull Value Maintenance Clauses (“VMC”) in the range of 100% to 125% and restrictions in dividend payments if an event of default has occurred and is continuing or would occur as a result of the payment of such dividend.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

The annual principal payments required to be made after March 31, 2015, are as follows:

Year ending December 31,	Amount
2015		142,998
2016		185,259
2017		227,259
2018		557,946
2019		60,396
2020 and thereafter		296,129
		1,469,987

The interest rates of Costamare’s long-term debt at December 31, 2014 and March 31, 2015, were in the range of 1.03%-6.75% and 1.03%-6.75%, respectively. The weighted average interest rate as at December 31, 2014 and March 31, 2015, was 4.2% and 4.2%, respectively.

Total interest expense incurred on long-term debt (including the effect of the interest rate swaps discussed in Note 16) for the three-month periods ended March 31, 2014 and 2015, amounted to $23,663 and $22,817, respectively and is included in Interest and finance costs in the accompanying consolidated statements of income. Of the above amount incurred in 2014, $1,612 was capitalized and is included (a) in Vessels, net ($1,125) and, (b) in the statement of comprehensive income ($487), representing net settlements on interest rate swaps qualifying for cash flow hedge.

11. Capital Leased Assets and Capital Lease Obligations:

The newbuild vessels MSC Azov, MSC Ajaccio and MSC Amalfi were delivered to the Company on January 14, 2014, March 14, 2014 and April 28, 2014, respectively (Note 6). At the same time, the Company agreed with a financial institution to refinance the then outstanding balance of the loans relating to MSC Azov, MSC Ajaccio and MSC Amalfi, by entering into a ten-year sale and leaseback transaction for each vessel upon their respective deliveries. The shipbuilding contracts for these vessels were novated to the financial institution for an amount of $85,572 each which took delivery of the vessels and the vessels were leased back for a period of ten years.

The sale and leaseback transactions were classified as capital leases. Furthermore, as the fair value of each vessel sold was in excess of its carrying amount, the difference between the sale proceeds and the carrying amount was considered as prepaid lease rentals. In this respect, an aggregate amount of $49,817 (including the net settlements on interest rate swaps qualifying for hedge accounting of $6,604) was transferred to prepaid lease rentals.

The total value of the three vessels at the inception of the capital lease transactions amounted to $256,716. The depreciation charged during the three-month periods ended March 31, 2014 and 2015, amounted to $644 and $1,869, respectively and are included in Depreciation in the accompanying consolidated statements of income. As of March 31, 2015, the net book value of the three vessels amounted to $248,678 and is separately reflected as Capital leased assets, in the accompanying 2015 consolidated balance sheet.

The balance of prepaid lease rentals, as of December 31, 2014 and March 31, 2015, is analyzed as follows:

	December 31, 2014			March 31, 2015
Prepaid lease rentals		49,817			45,793
Less: Amortization of prepaid lease rentals		(4,024	)		(1,228	)
Prepaid lease rentals		45,793			44,565
Less: current portion		(4,982	)		(4,992	)
Non-current portion		40,811			39,573

The capital lease obligations amounting to $243,865 as at March 31, 2015, are scheduled to expire through 2024 and include a bargain purchase option to repurchase the vessels at any time during the charter period. Total interest expense incurred on capital leases for the three month periods ended March 31, 2014 and 2015, amounted to $1,663 and $4,312, respectively and are included in Interest and finance costs in the accompanying consolidated statements of income.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

The annual lease payments in aggregate required under the capital leases after March 31, 2015, are as follows:

Year ending December 31,	Amount
2015		23,073
2016		30,783
2017		30,698
2018		30,698
2019		30,699
2020 and thereafter		207,553
Total		353,504
Less: Amount of interest		(109,639	)
Total lease payments		243,865

The total capital lease obligations are presented in the accompanying March 31, 2015, consolidated balance sheet as follows:

Capital lease obligation – current			13,772
Capital lease obligation – non current			230,093
			243,865

12. Accrued Charter Revenue, Current and Non-Current and Unearned Revenue, Current and Non-Current:

(a) Accrued charter revenue, Current and Non-Current: The amounts presented as current and non-current accrued charter revenue in the accompanying consolidated balance sheets as of December 31, 2014 and March 31, 2015, reflect revenue earned, but not collected, resulting from charter agreements providing for varying annual charter rates over their term, which were accounted for on a straight-line basis at their average rates. As at December 31, 2014, the net accrued charter revenue, totaling to ($32,751) comprises $511 separately reflected in Current assets, $1,025 separately reflected in Non-current assets, and $34,287 (discussed in (b) below) included in Unearned revenue in current and non-current liabilities in the accompanying 2014 consolidated balance sheet. As at March 31, 2015, the net accrued charter revenue, totaling to ($33,378) comprises $522 separately reflected in Current assets, $923 separately reflected in Non-current assets, and ($34,823) (discussed in (b) below) included in Unearned revenue in current and non-current liabilities in the accompanying 2015 consolidated balance sheet. The maturities of the net accrued charter revenue as of December 31 of each year presented below are as follows:

Year ending December 31,	Amount
2015		(3,221	)
2016		(9,430	)
2017		(11,336	)
2018		(8,794	)
2019		(597	)
		(33,378	)

(b) Unearned Revenue, Current and Non-Current: The amounts presented as current and non-current unearned revenue in the accompanying consolidated balance sheets as of December 31, 2014 and March 31, 2015, reflect: (a) cash received prior to the balance sheet date for which all criteria to recognize as revenue have not been met and, (b) any unearned revenue resulting from charter agreements providing for varying annual charter rates over their term, which were accounted for on a straight-line basis at their average rate.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

	December 31, 2014		March 31, 2015
Hires collected in advance		8,096		8,212
Charter revenue resulting from varying charter rates		34,287		34,823
Total		42,383		43,035
Less current portion		(12,929)		(13,535)
Non-current portion		29,454		29,500

13. Commitments and Contingencies:

(a) Long-term time charters: As at March 31, 2015, the Company has entered into time charter arrangements on all of its vessels in operation with international liner operators. These arrangements as at March 31, 2015, have remaining terms of up to 108 months. As of the same date, future minimum contractual charter revenues assuming 365 revenue days per annum per vessel and the earliest redelivery dates possible, based on vessels’ committed, non-cancelable, long-term time charter contracts, are as follows:

Year ending December 31,	Amount
2015		348,352
2016		420,954
2017		371,984
2018		198,759
2019		122,306
2020 and thereafter		310,852
		1,773,207

(b) Pursuant to the Framework Agreement the Company has a contractual commitment of approximately $126,899 representing 49% of the remaining construction cost of three vessels under construction, 40% of the remaining construction cost of five vessels under construction and 25% of the construction cost of two vessels under construction (Note 9).

(c) Other: Various claims, suits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims with suppliers relating to the operations of the Company’s vessels. Currently, management is not aware of any such claims not covered by insurance or contingent liabilities, which should be disclosed, or for which a provision has not been established in the accompanying consolidated financial statements.

The Company accrues for the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any other claims or contingent liabilities which should be disclosed or for which a provision should be established in the accompanying consolidated financial statements.

The Company is covered for liabilities associated with the individual vessels’ actions to the maximum limits as provided by Protection and Indemnity (P&I) Clubs, members of the International Group of P&I Clubs.

14. Common Stock, Preferred Stock and Additional Paid-In Capital:

(a) Common Stock: From inception through July 11, 2010, the authorized common stock of Costamare consisted of 2,000,000 shares with a par value of $0.0001 per share out of which 1,000,000 shares were issued to the Family. On July 12, 2010, the Company’s articles of incorporation were amended. Under the amended articles of incorporation, the Company’s authorized capital stock consists of 1,000,000,000 shares of common stock, par value $0.0001 per share and 100,000,000 preferred shares, par value $0.0001 per share of which no shares were issued. Of these preferred shares, 10,000,000 shares have been designated Series A Participating Preferred Stock in connection with the adoption of a stockholder rights plan. All shares of stock are in registered form.

On July 20, 2010, pursuant to a rights offering authorized by the Board of Directors on July 14, 2010, the Company issued 24,000,000 shares of common stock in exchange of $2,400, increasing the issued share capital of the Company to 25,000,000 shares of common stock.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

On October 19, 2010, within the context of the Initial Public Offering completed in November 2010, the Company effected a dividend of 0.88 shares for each share of common stock outstanding on the record date of August 27, 2010 (the “Stock Split”). As a result of this dividend, the Company issued 22,000,000 additional shares in respect of its 25,000,000 shares of the then outstanding common stock.

On November 4, 2010, the Company completed its Initial Public Offering in the United States under the Securities Act. In this respect 13,300,000 common shares at par value $0.0001 were issued at a public offering price of $12.00 per share, increasing the issued share capital to 60,300,000 shares. The net proceeds of the Initial Public Offering were $145,543.

On March 27, 2012, the Company completed a follow-on public equity offering in the United States under the Securities Act. In this respect 7,500,000 shares at par value $0.0001 were issued at a public offering price of $14.10 per share, increasing the issued share capital to 67,800,000 shares. The net proceeds of the follow-on offering were $100,584.

On October 19, 2012, the Company completed a follow-on public equity offering in the United States under the Securities Act. In this respect 7,000,000 shares at par value $0.0001 were issued at a public offering price of $14.00 per share, increasing the issued share capital to 74,800,000 shares. The net proceeds of the follow-on offering were $93,547.

On March 31, 2015, the Company issued 149,600 shares at par value $0.0001 to Costamare Shipping pursuant to the Group Management Agreement (Note 3).

(b) Preferred Stock: On August 7, 2013, the Company issued 2,000,000, Series B Cumulative Redeemable Perpetual Preferred Stock (the “Series B Preferred Stock”) in the United States under the Securities Act, which pay dividends of 7.625% per annum in arrears on a quarterly basis (equal to $1.90625 per annum per share) at $25 per share. At any time after August 6, 2018, the Series B Preferred Stock may be redeemed, at the Company’s election at a price of $25 of liquidation preference per share. The net proceeds from the offering were $48,042.

On January 22, 2014, the Company issued 4,000,000, Series C Cumulative Redeemable Perpetual Preferred Stock (the “Series C Preferred Stock”) in the United States under the Securities Act, which pay dividends of 8.50% per annum in arrears on a quarterly basis (equal to $2.125 per annum per share) at $25 per share. At any time after January 21, 2019, the Series C Preferred Stock may be redeemed, at the Company’s election at a price of $25 of liquidation preference per share. The net proceeds from the offering were $96,523.

(c) Additional Paid-in Capital: The amounts shown in the accompanying consolidated balance sheets, as additional paid-in capital, include: (i) payments made by the stockholders at various dates to finance vessel acquisitions in excess of the amounts of bank loans obtained, (ii) advances for working capital purposes, (iii) the difference between the par value of the shares issued in the Initial Public Offering in November 2010 and the offerings in March 2012, October 2012, August 2013, January 2014 and the net proceeds received from the issuance of such shares and (iv) the difference between the par value and the fair value of theshares issued to Costamare Shipping (Note 3).

(d) Dividends declared and / or paid: During the three-month period ended March 31, 2014, the Company declared and paid to its common stockholders $20,196 or $0.27 per common share for the fourth quarter of 2013. During the three-month period ended March 31, 2015, the Company declared and paid to its common stockholders $20,944 or $0.28 per common share for the fourth quarter of 2014. During the three-month period ended March 31, 2014, the Company declared and paid to its holders of Series B Preferred Stock $953 or $0.476563 per share for the period from October 15, 2013 to January 14, 2014. During the three month period ended March 31, 2015 the Company declared and paid to its holders of Series B Preferred Stock $953 or $0.476563 per share for the period from October 15, 2014 to January 14, 2015. During the three-month period ended March 31, 2015, the Company declared and paid to its holders of Series C Preferred Stock $2,125 or $0.531250 per share for the period from October 15, 2014 to January 14, 2015. On March 27, 2015, the Company declared a dividend of $0.476563 per share on the Series B Preferred Stock (Note 21(b)) and a dividend of $0.531250 per share on the Series C Preferred Stock (Note 21(b)), for the period January 15, 2015 to April 14, 2015.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

15. Earnings per share (EPS)

All common shares issued are Costamare common stock and have equal rights to vote and participate in dividends. In August 2013, the Company issued Series B Preferred Stock, receiving an annual dividend of 7.625% in arrears on the 15th day of January, April, July and October of each year. Furthermore, in January 2014 the Company issued Series C Preferred Stock, receiving an annual dividend of 8.50% in arrears on the 15th day of January, April, July and October of each year. Profit or loss attributable to common equity holders is adjusted by the contractual amount of dividends on Series B Preferred Stock and Series C Preferred Stock that should be paid for the period. Dividends paid or accrued on Series B Preferred Stock and Series C Preferred Stock during the three-month periods ended March 31, 2014 and 2015, amounted to $2,606, and $3,010, respectively.

	March 31, 2014			March 31, 2015
	Basic EPS			Basic EPS
Net income	$	19,833		$	26,284
Less: paid and accrued earnings allocated to Preferred Stock		(2,606	)		(3,010	)
Net income available to common stockholders		17,227			23,274
Weighted average number of common shares, basic and diluted		74,800,000			74,801,662
Earnings per common share, basic and diluted	$	0.23			0.31

16. Interest and Finance Costs:

The amounts in the accompanying consolidated statements of income are analyzed as follows:

	March 31, 2014			March 31, 2015
Interest expense		10,377			11,360
Interest capitalized		(1,612	)		-
Swap effect		14,949			15,769
Amortization and write-off of financing costs		1,872			472
Commitment fees		130			276
Bank charges and other		80			66
		25,796			27,943

17. Taxes:

Under the laws of the countries of the companies’ incorporation and/or vessels’ registration, the companies are not subject to tax on international shipping income; however, they are subject to registration and tonnage taxes, which are included in Vessel operating expenses in the accompanying consolidated statements of income.

The vessel owning companies with vessels that have called on the United States during the relevant year of operation are obliged to file tax returns with the Internal Revenue Service. The applicable tax is 50% of 4% of U.S. related gross transportation income unless an exemption applies. Management believes that based on current legislation the relevant vessel owning companies are entitled to an exemption because they satisfy the relevant requirements, namely that (i) the related vessel owning companies are incorporated in a jurisdiction granting an equivalent exemption to U.S. corporations and (ii) over 50% of the ultimate stockholders of the vessel owning companies are residents of a country granting an equivalent exemption to U.S. persons.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

18. Derivatives:

(a) Interest rate swaps that meet the criteria for hedge accounting: The Company, according to its long-term strategic plan to maintain stability in its interest rate exposure, has decided to minimize its exposure to floating interest rates by entering into interest rate swap agreements. To this effect, the Company has entered into interest rate swap transactions with varying start and maturity dates, in order to proactively and efficiently manage its floating rate exposure.

These interest rate swaps are designed to hedge the variability of interest cash flows arising from floating rate debt, attributable to movements in three-month or six-month USD LIBOR. According to the Company’s Risk Management Accounting Policy, after putting in place the formal documentation required by ASC 815 in order to designate these swaps as hedging instruments as from their inception, these interest rate swaps qualified for hedge accounting. Accordingly, only hedge ineffectiveness amounts arising from the differences in the change in fair value of the hedging instrument and the hedged item are recognized in the Company’s earnings. Assessment and measurement of the effectiveness of these interest rate swaps are performed at each reporting period. For qualifying cash flow hedges, the fair value gain or loss associated with the effective portion of the cash flow hedge is recognized initially in “Other comprehensive income” and recognized to the consolidated statement of income in the periods when the hedged item affects profit or loss. Any ineffective portion of the gain or loss on the hedging instrument is recognized in the consolidated statement of income immediately.

At December 31, 2014 and March 31, 2015, the Company had interest rate swap agreements with an outstanding notional amount of $1,030,642 and $995,908, respectively. The fair value of these interest rate swaps outstanding at December 31, 2014 and March 31, 2015, amounted to a liability of $55,422 and a liability of $56,702, respectively and these are included in the accompanying consolidated balance sheets. The maturity of these interest rate swaps range between June 2015 and August 2020.

During the three-month periods ended March 31, 2014 and 2015, the realized ineffectiveness on the interest rate swaps discussed under (a) above was a loss of $38 and a loss of $60, respectively and are included in Gain on derivative instruments, net in the accompanying consolidated statements of income.

During the three-month period ended March 31, 2014, the Company terminated two interest rate derivative instruments and paid the counterparty breakage costs of $6,712 in aggregate and is reflected in the Swaps breakage costs in the accompanying 2014 consolidated statement of income.

(b) Interest rate swaps that do not meet the criteria for hedge accounting: As of December 31, 2014 and March 31, 2015, the Company had interest rate swap agreements with an outstanding notional amount of $217,533 and $213,759, respectively for the purpose of managing risks associated with the variability of changing LIBOR-related interest rates. Such agreements did not meet hedge accounting criteria and, therefore, changes in its fair value are reflected in earnings. The fair value of these interest rate swaps at December 31, 2014 and March 31, 2015, was a liability of $18,509 and a liability of $16,596, respectively and these are included in Fair value of derivatives in the accompanying consolidated balance sheets. The maturity of these interest rate swaps range between February 2017 and August 2020.

(c) Foreign currency agreements: As of March 31, 2015, the Company was engaged in twenty-one Euro/U.S. dollar forward agreements totaling $31,500 at an average forward rate of Euro/U.S. dollar 1.131 expiring in monthly intervals up to February 2016.

As of December 31, 2014, the Company was engaged in nine Euro/U.S. dollar forward agreements totaling $22,500 at an average forward rate of Euro/U.S. dollar 1.273 expiring in monthly intervals up to September 2015.

The total change of forward contracts fair value for the three-month period ended March 31, 2015, was a loss of $1,420 ($nil for the three-month period ended March 31, 2014) and is included in Gain on derivative instruments, net in the accompanying 2015 consolidated statement of income.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

The Effect of Derivative Instruments for the three-month periods ended March 31, 2014 and 2015

Derivatives in ASC 815 Cash Flow Hedging Relationships

	Amount of Gain / (Loss) Recognized in Accumulated OCI on Derivative (Effective Portion)		Location of Gain / (Loss) Recognized in Income on	Amount of Gain / (Loss) Recognized in Income on Derivative (Ineffective Portion)
	2014	2015	Derivative (Ineffective Portion)	2014	2015
Interest rate swaps	(692)	(9,609)	Gain on derivative instruments, net	(38)	(60)
Reclassification to Interest and finance costs	12,161	10,333		-	-
Total	11,469	724		(38)	(60)

Derivatives Not Designated as Hedging Instruments and ineffectiveness of Hedging Instruments under ASC 815
	Location of Gain / (Loss) Recognized in Income on Derivative	Amount of Gain / (Loss) Recognized in Income on Derivative
		2014	2015
Non hedging interest rate swaps	Gain on derivative instruments, net	2,812	2,024
Ineffective portion of hedging interest rate swaps	Gain on derivative instruments, net	(38)	(60)
Forward contracts	Gain on derivative instruments, net	-	(1,420)
Total		2,774	544

19. Financial Instruments:

(a) Interest rate risk: The Company’s interest rates and loan repayment terms are described in Note 10.

(b) Concentration of credit risk: Financial instruments which potentially subject the Company to significant concentrations of credit risk, consist principally of cash and cash equivalents, accounts receivable (included in current and non-current assets), investments in affiliates, equity securities, debt securities and derivative contracts (interest rate swaps and foreign currency contracts). The Company places its cash and cash equivalents, consisting mostly of deposits, with high credit rated financial institutions. The Company performs periodic evaluations of the relative credit standing of those financial institutions. The Company is exposed to credit risk in the event of non-performance by counterparties to derivative instruments; however, the Company limits its exposure by diversifying among counterparties with high credit ratings. The Company limits its credit risk with accounts receivable, investments in affiliates and equity and debt securities by performing ongoing credit evaluations of its customers’, affiliates’ and investees’ financial condition and generally does not require collateral for its accounts receivable.

(c) Fair value: The carrying amounts reflected in the accompanying consolidated balance sheet of financial assets and accounts payable approximate their respective fair values due to the short maturity of these instruments. The fair value of long-term bank loans with variable interest rates approximate the recorded values, generally due to their variable interest rates. The fair value of the interest rate swap agreements and the foreign currency agreements discussed in Note 18 above are determined through Level 2 of the fair value hierarchy as defined in FASB guidance for Fair Value Measurements and are derived principally from or corroborated by observable market data, interest rates, yield curves and other items that allow value to be determined.

COSTAMARE INC.

Notes to Unaudited Consolidated Financial Statements

March 31, 2014 and 2015

(Expressed in thousands of U.S. dollars, except share and per share data)

The fair value of the interest rate swap agreements discussed in Note 18(a) and (b) equates to the amount that would be paid by the Company to cancel the agreements. As at December 31, 2014 and March 31, 2015, the fair value of these interest rate swaps in aggregate amounted to a liability of $73,931 and $73,298, respectively.

The fair market value of the forward contracts discussed in Note 18(c) determined through Level 2 of the fair value hierarchy as at December 31, 2014 and March 31, 2015, amounted to a liability of $1,009 and a liability of $2,429, respectively.

The following tables summarize the hierarchy for determining and disclosing the fair value of assets and liabilities by valuation technique on a recurring basis as of the valuation date.

	December 31, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring measurements:
Forward contracts-liability position		(1,009)		-		(1,009)		-
Interest rate swaps-liability position		(73,931)		-		(73,931)		-
Total		(74,940)		-		(74,940)		-

	March 31, 2015		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring measurements:
Forward contracts-liability position		(2,429)		-		(2,429)		-
Interest rate swaps-liability position		(73,298)		-		(73,298)		-
Total		(75,727)		-		(75,727)		-

20. Comprehensive Income:

During the three month period ended March 31, 2014, Other comprehensive income increased with net gains of $15,337 relating to (i) the change of the fair value of derivatives that qualify for hedge accounting (loss of $692), net of the settlements to net income of derivatives that qualify for hedge accounting (gain of $12,161), (ii) the Net settlements on interest rate swaps qualifying for cash flow hedge associated with vessels under construction ($487), (iii) the amounts reclassified from Net settlements on interest rate swaps qualifying for hedge accounting to depreciation ($25) and (iv) the amounts reclassified from net settlements on interest rate swaps qualifying for hedge accounting to Prepaid lease rentals ($4,330). During the three month period ended March 31, 2015, Other comprehensive income increased with net gains of $749 relating to (i) the change of the fair value of derivatives that qualify for hedge accounting (loss of $9,609), net of the settlements to net income of derivatives that qualify for hedge accounting (gain of $10,333) and, (ii) the amounts reclassified from Net settlements on interest rate swaps qualifying for hedge accounting to depreciation ($25). As at March 31, 2014 and 2015, Comprehensive income amounted to $35,170 and $27,033, respectively.

21. Subsequent Events:

(a)	Declaration of Dividends (common stock): On April 1, 2015, the Company declared a dividend for the first quarter ended March 31, 2015, of $0.29 per share on our common stock, payable on May 6, 2015, to stockholders of record on April 21, 2015.

(b)

Payment of Dividends (preferred stock Series B and Series C): On April 15, 2015, the Company paid a cash dividend of $953 or $0.476563 per share on its Series B Preferred Stock (Note 14(c)) and a cash dividend of $2,125 or $0.531250 per share on its Series C Preferred Stock (Note 14(c)), to holders of record on April 14, 2015.

	December 31, 2014			March 31, 2015
	(Audited)			(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	113,089		$	84,248
Restricted cash		14,264			8,902
Accounts receivable, net		2,365			1,552
Inventories (Note 5)		11,565			10,435
Due from related parties (Notes 3 and 9)		4,447			4,801
Insurance claims receivable		1,759			2,019
Prepaid lease rentals (Note 11)		4,982			4,992
Accrued charter revenue (Note 12)		511			522
Prepayments and other		4,993			7,038
Total current assets		157,975			124,509
FIXED ASSETS, NET:
Capital leased assets (Note 11)		250,547			248,678
Vessels, net (Note 6)		2,098,820			2,076,094
Total fixed assets, net		2,349,367			2,324,772
NON-CURRENT ASSETS:
Investment in affiliates (Note 9)		73,579			86,347
Prepaid lease rentals, non-current (Note 11)		40,811			39,573
Accounts receivable, non-current, net (Note 3)		1,425			1,425
Deferred charges, net (Note 7)		28,675			28,180
Restricted cash		49,818			48,277
Accrued charter revenue, non-current (Note 12)		1,025			923
Other non-current assets (Note 4)		12,065			12,338
Total assets	$	2,714,740		$	2,666,344
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt (Note 10)	$	192,951		$	190,853
Accounts payable		6,296			6,114
Capital lease obligations (Note 11)		13,508			13,772
Accrued liabilities		19,119			17,202
Unearned revenue (Note 12)		12,929			13,535
Fair value of derivatives (Notes 18 and 19)		43,287			39,911
Other current liabilities		2,286			2,059
Total current liabilities		290,376			283,446
NON-CURRENT LIABILITIES:
Long-term debt, net of current portion (Note 10)		1,326,990			1,279,134
Capital lease obligations, net of current portion (Note 11)		233,625			230,093
Fair value of derivatives, net of current portion (Notes 18 and 19)		31,653			35,816
Unearned revenue, net of current portion (Note 12)		29,454			29,500
Total non-current liabilities		1,621,722			1,574,543
COMMITMENTS AND CONTINGENCIES (Note 13)		-			-
STOCKHOLDERS’ EQUITY:
Preferred stock (Note 14)		-			-
Common stock (Note 14)		8			8
Additional paid-in capital (Note 14)		858,665			861,299
Retained earnings		103			2,433
Accumulated other comprehensive loss (Notes 18 and 20)		(56,134	)		(55,385	)
Total stockholders’ equity		802,642			808,355
Total liabilities and stockholders’ equity	$	2,714,740		$	2,666,344


	Three-month period ended March 31,
	2014			2015

REVENUES:
Voyage revenue	$	114,898		$	120,850
EXPENSES:
Voyage expenses		(685	)		(636	)
Voyage expenses-related parties (Note 3)		(862	)		(905	)
Vessels’ operating expenses		(29,384	)		(29,551	)
General and administrative expenses		(847	)		(690	)
General and administrative expenses – related parties (Note 3)		(250	)		(3,259	)
Management fees-related parties (Note 3)		(4,471	)		(4,818	)
Amortization of dry-docking and special survey costs (Note 7)		(1,898	)		(1,825	)
Depreciation (Notes 6, 11 and 20)		(25,208	)		(25,066	)
Amortization of prepaid lease rentals (Note 11)		(410	)		(1,228	)
Foreign exchange gains / (losses), net		(63	)		290
Operating income		50,820			53,162
OTHER INCOME / (EXPENSES):
Interest income		150			438
Interest and finance costs (Note 16)		(25,796	)		(27,943	)
Swaps breakage costs (Note 18)		(6,712	)		-
Equity loss on investments (Note 9)		(2,278	)		(195	)
Other, net (Note 9)		875			278
Gain on derivative instruments, net (Note 18)		2,774			544
Total other expenses		(30,987	)		(26,878	)
Net Income	$	19,833		$	26,284
Earnings allocated to Preferred Stock (Note 15)		(2,606	)		(3,010	)
Net income available to Common Stockholders		17,227			23,274
Earnings per common share, basic and diluted (Note 15)	$	0.23		$	0.31
Weighted average number of shares, basic and diluted		74,800,000			74,801,662

	Preferred Stock (Series C)				Preferred Stock (Series B)				Common Stock

	# of shares		Par value		# of shares		Par value		# of shares		Par value		Additional Paid-in Capital			Accumulated Other Comprehensive Loss			Retained Earnings / (Accumulated Deficit)			Total
BALANCE, January 1, 2014		-	$	-		2,000,000	$	-		74,800,000	$	8	$	762,142		$	(85,154	)	$	(20,047	)	$	656,949
- Net income		-		-		-		-		-		-		-			-			19,833			19,833
- Preferred stock Series C issuance		4,000,000		-		-		-		-		-		96,850			-			-			96,850
- Preferred stock Series C expenses		-		-		-		-		-		-		(327	)		-			-			(327	)
- Dividends -Common stock		-		-		-		-		-		-		-			-			(20,196	)		(20,196	)
- Dividends -Preferred stock		-		-		-		-		-		-		-			-			(2,606	)		(2,606	)
- Other comprehensive loss		-		-		-		-		-		-		-			15,337			-			15,337
BALANCE, March 31, 2014		4,000,000	$	-		2,000,000	$	-		74,800,000	$	8	$	858,665		$	(69,817	)	$	(23,016	)	$	765,840

BALANCE, January 1, 2015		4,000,000	$	-		2,000,000	$	-		74,800,000	$	8	$	858,665		$	(56,134	)	$	103		$	802,642
- Net income		-		-		-		-		-		-		-			-			26,284			26,284
- Issuance of common stock (Note 3)		-		-		-		-		149,600		-		2,634			-			-			2,634
- Dividends -Common stock		-		-		-		-		-		-		-			-			(20,944	)		(20,944	)
- Dividends -Preferred stock		-		-		-		-		-		-		-			-			(3,010	)		(3,010	)
- Other comprehensive income		-		-		-		-		-		-		-			749			-			749
BALANCE, March 31, 2015		4,000,000	$	-		2,000,000	$	-		74,949,600	$	8	$	861,299		$	(55,385	)	$	2,433		$	808,355