| PART I | 5 |
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| Item 1. Identity of Directors, Senior Management and Advisors. | 5 |
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| Item 2. Offer Statistics and Expected Timetable. | 5 |
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| Item 3. Item 3. Key Information. | 5 |
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| Item 4. Information on the Partnership. | 42 |
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| Item 5. Operating and Financial Review and Prospects. | 66 |
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| Item 6. Directors, Senior Management and Employees. | 66 |
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| Item 7. Major Unitholders and Related-Party Transactions. | 88 |
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| Item 8. Financial Information. | 99 |
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| Item 9. The Offer and Listing. | 106 |
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| Item 10. Additional Information. | 107 |
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| Item 11. Quantitative and Qualitative Disclosures about Market Risk. | 116 |
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| Item 12. Description of Securities Other than Equity Securities. | 116 |
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| PART II | 117 |
|---|
| Item 13. Defaults, Dividend Arrearages and Delinquencies. | 117 |
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| Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds. | 117 |
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| Item 15. Controls and Procedures. | 117 |
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| Item 16. | 118 |
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| PART III | 122 |
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| Item 17. Financial Statements | 122 |
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| Item 18. Financial Statements. | 122 |
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| Item 19. Exhibits | 123 |
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ABOUT THIS REPORT
This annual report on Form 20-F (this “Annual Report”) should be read in conjunction with our audited consolidated balance sheets as of December 31, 2023 and 2022, the related consolidated statements of comprehensive income, changes in partners’ capital, and cash flows, for each of the three years in the period ended December 31, 2023, and the related notes included herein (the “Financial Statements”).
In this Annual Report, unless the context otherwise requires:
| • | the “Partnership”, “CPLP”, “we”, “us” or “our” refer to Capital Product Partners L.P. and, unless the context otherwise requires, its consolidated subsidiaries; |
| • | “General Partner” refers to Capital GP L.L.C., our general partner; |
| • | “Capital Maritime” or “CMTC” refer to Capital Maritime & Trading Corp., our sponsor; |
| • | “Capital Gas” refers to Capital Gas Corp.; |
| • | “Capital-Executive” refers to Capital-Executive Ship Management Corp.; |
| • | “Capital Ship Management” refers to Capital Ship Management Corp.; |
| • | “Capital Gas Management” refers to Capital Gas Ship Management Corp.; |
| • | the “Managers” refers to our managers, Capital-Executive, Capital Ship Management and Capital Gas Management; |
| • | “Umbrella Agreement” refers to the umbrella agreement, which we entered into on November 13, 2023 with Capital Maritime and our General Partner; |
| • | the “Conflicts Committee” refers to the conflicts committee of our board of directors; |
| • | “CPLP PLC” refers to CPLP Shipping Holdings PLC, a public limited liability company and wholly owned subsidiary of CPLP; |
| • | “Bonds” refers to €100.0 million and €150.0 million of senior unsecured bonds issued by CPLP PLC and guaranteed by CPLP, which were listed on the Athens Stock Exchange in July 2022 and October 2021, respectively; |
| • | “financing arrangements” refers to our debt financing arrangements as well as to our sale-leaseback financing arrangements, seller’s credit agreements and the Bonds; and |
| • | “debt” includes indebtedness under the financing arrangements. |
FORWARD LOOKING STATEMENTS
Our disclosure and analysis in this Annual Report concerning our business, operations, cash flows, and financial position, including, among other things, the likelihood of our success in developing and expanding our business, include “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Such statements include, in particular, statements about our plans, strategies, business prospects, changes and trends in our business, financial condition and the markets in which we operate, and involve risks and uncertainties. In some cases, you can identify forward-looking statements by the use of words such as “may,” “might,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “likely,” “intend,” “forecast,” “believe,” “estimate,” “project,” “predict,” “propose,” “potential,” “continue,” “seek” or the negative of these terms or other comparable terminology. Although these statements are based upon assumptions we believe to be reasonable based upon available information, including projections of revenues, operating margins, earnings, cash flows, working capital and capital expenditures, they are subject to risks and uncertainties that are described more fully in this Annual Report in “Item 3. Key Information—D. Risk Factors” below. These forward-looking statements represent our estimates and assumptions only as of the date of this Annual Report and are not intended to give any assurance as to future results. As a result, you are cautioned not to rely on any forward-looking statements. Forward-looking statements appear in a number of places in this Annual Report and include statements with respect to, among other things:
| • | expectations regarding our ability to make distributions on our common units; |
| • | our ability to increase our cash available for distribution over time; |
| • | expectations regarding global economic outlook and growth; |
| • | expectations regarding shipping conditions and fundamentals, including the balance of supply and demand, as well as trends and conditions in the newbuild markets and scrapping of older vessels; |
| • | our current and future business and growth strategies and other plans and objectives for future operations, future acquisitions and deliveries of vessels from Capital Maritime or third parties, and the expected benefits from the liquefied natural gas (“LNG”) carriers (“LNG/C”) that we have agreed to acquire from Capital Maritime pursuant to the Umbrella Agreement; |
| • | expectations regarding the transactions contemplated by the Umbrella Agreement, including our intention to explore the disposition of our container vessels and abstain from acquiring additional container vessels and negotiate our conversion from a limited partnership to a corporation with customary corporate governance; |
| • | our continued ability to enter into medium- or long-term, fixed-rate time charters with our charterers and to re-charter our vessels at attractive rates as their existing charters expire; |
| • | the relationships and reputations of our Managers and our General Partner in the shipping industry; |
| • | the financial condition, viability and sustainability of our charterers, including their ability to meet their obligations under the terms of our charter agreements; |
| • | our ability to maximize the use of our vessels; |
| • | our ability to access debt, credit and equity markets; |
| • | our ability to service, refinance or repay our financing under our financing arrangements and settle our hedging arrangements; |
| • | planned capital expenditures and availability of capital resources to fund capital expenditures; |
| • | the expected lifespan and condition of our vessels; |
| • | changes to the regulatory requirements applicable to the shipping industry, including, without limitation, stricter requirements adopted by international organizations and the European Union (“EU”), or by individual countries or charterers and actions taken by regulatory authorities overseeing such areas as safety and environmental compliance; |
| • | our ability to successfully operate exhaust gas cleaning systems (“scrubbers”) or other newly installed equipment and novel technologies on certain or all of our vessels; |
| • | the expected cost of, and our ability to comply with, governmental regulations and maritime self-regulatory organization standards, including new environmental regulations and standards, as well as standard regulations imposed by our charterers applicable to our business; |
| • | the impact of heightened regulations and the actions of regulators and other government authorities, including anti-corruption laws and regulations, as well as sanctions and other governmental actions; |
| • | our anticipated general and administrative expenses; |
| • | the adequacy of our insurance arrangements and our ability to obtain insurance and required certifications; |
| • | the anticipated taxation of our partnership and distributions to our common unitholders; |
| • | the ability of our General Partner to retain its officers and the ability of our Managers to retain key employees; |
| • | anticipated funds for liquidity needs and the sufficiency of cash flows; and |
| • | the ability of our counterparties to perform under our shipbuilding contracts. |
The preceding list is not intended to be an exhaustive list of all our forward-looking statements. These and other forward-looking statements are made based upon management’s current plans, expectations, estimates, assumptions and beliefs concerning future events impacting us and, therefore, involve a number of risks and uncertainties, including those risks discussed in “Item 3. Key Information—D. Risk Factors” below, which could cause actual results to be materially different from those contained in any forward-looking statement. The risks, uncertainties and assumptions involve known and unknown risks and are inherently subject to significant uncertainties and contingencies, many of which are beyond our control. We caution that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements.
Unless required by law, we expressly disclaim any obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement. You should carefully review and consider the various disclosures included in this Annual Report that attempt to advise interested parties of the risks and factors that may affect our business, prospects and results of operations.
