Commitments And Contingencies

3 Months Ended

Mar. 31, 2015

Commitments And Contingencies [Abstract]

Commitments And Contingencies

NOTE 9 – COMMITMENTS AND CONTINGENCIES

Commitments

Investment in newbuilding Handysize Dry Bulk Carrier

During the third quarter of 2014, we were notified of the bankruptcy of a ship builder that had agreed to build a new Handysize Dry Bulk Carrier.  As a result of this bankruptcy, we collected $4.2 million on January 6, 2015, $3.9 million of which represented a return of our deposit and $0.3 million of which we recognized as interest income.

Contingencies

On June 26, 2014, U.S. Customs and Border Protection (CBP) issued pre-penalty notifications to us and two of our affiliates alleging failure to properly report the importation of spare parts incorporated intoour vessels covering the period April 2008 through September 2012.  CBP’s proposed duty is approximately $2.1 million along with a proposed penalty on the assessment of approximately $8.4 million.  The basis of CBP’s assessment is that the U. S. Government experienced a loss of revenue consisting of the difference between the government’s ad valorem duty and the consumption entry duty actually paid by us.  On September 24, 2014, we submitted our formal response to CBP’s claim and denied violating the applicable U.S. statute or regulations.We have not accrued a liability for this matter because we believe it is premature (i) to determine whether an accrual is warranted and (ii) if so, to determine a reasonable estimate of probable liability.

For further information on our commitments and contingencies, see Note K – Commitment and Contingencies to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2014.