Fixed Assets

6 Months Ended

Jun. 30, 2020

Property, Plant and Equipment [Abstract]

FIXED ASSETS

At June 30, 2020, the Company owned eighteen dry bulk vessels including three financed under finance leases; and one barge. The carrying amounts of these vessels, including unamortized drydocking costs, are as follows:


	June 30,		December 31,
	2020		2019
Owned vessels	(unaudited)
m/v BULK PANGAEA	$	14,312,159	$	14,988,076
m/v BULK NEWPORT	12,470,458		12,975,767
m/v NORDIC ODYSSEY ⁽³⁾	22,232,766		22,897,029
m/v NORDIC ORION ⁽³⁾	23,100,663		23,688,812
m/v NORDIC OSHIMA ⁽³⁾	27,646,301		28,325,078
m/v NORDIC ODIN ⁽³⁾	28,060,270		28,094,764
m/v NORDIC OLYMPIC ⁽³⁾	27,983,056		27,931,771
m/v NORDIC OASIS ⁽³⁾	28,609,980		29,190,935
m/v BULK ENDURANCE	24,531,184		25,037,775
m/v BULK FREEDOM	9,806,141		8,269,777
m/v BULK PRIDE	13,028,499		12,996,311
m/v BULK SPIRIT	12,896,925		12,867,060
m/v BULK INDEPENDENCE	14,138,559		14,000,946
m/v BULK FRIENDSHIP	13,741,877		14,052,500

MISS NORA G PEARL ⁽⁴⁾	3,385,815		3,609,851
	275,944,653		278,926,452
Other fixed assets, net	2,438,406		2,548,405
Total fixed assets, net	$	278,383,059	$	281,474,857

Right of Use Assets
m/v BULK DESTINY	$	21,060,499	$	21,484,733
m/v BULK BEOTHUK ^{(1) (2)}	—		6,589,537
m/v BULK TRIDENT	11,802,319		12,095,727
m/v BULK PODS	$	13,397,164	13,445,308
	$	46,259,982	$	53,615,305

⁽¹⁾ In January 2020 the Company completed an early buy-out of the lease for a purchase price of $5.5 million.

⁽²⁾ On June 29, 2020, the Company entered into a memorandum of agreement to sell the Bulk Beothuk, a 2002-built Supramax vessel, to a third party for $4.6 million less a broker commission payable to a third party. The vessel assets were classified as held for sale in the Consolidated Balance Sheet as of June 30, 2020.

⁽³⁾ Vessels are owned by Nordic Bulk Holding Company Ltd. (“NBHC”), a consolidated joint venture which the Company has one-third of ownership.

⁽⁴⁾ Venture Barge is owned by a 50% owned consolidated subsidiary.

Long-lived Assets Impairment Considerations

The Company evaluates the recoverability of its fixed assets and other assets in accordance with ASC 360-10-15, Impairment or Disposal of Long-Lived Assets, which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than their carrying amounts. If indicators of impairment are present, we perform an analysis of the anticipated undiscounted future net cash flows to be derived from the related long-lived assets. Our assessment is made at the asset group level, which represents the lowest level for which identifiable cash flows are largely independent of other groups of assets. The asset groups established by the Company are defined by vessel size and major characteristic or trade.

On June 29, 2020 the Company entered into an agreement to sell the Bulk Beothuk for $4.6 million, the sale was finalized and the vessel delivered to its new owner on August 4, 2020. A loss on impairment of $1.8 million was recorded in the second quarter of 2020 when the Memorandum of Agreement was signed. As the carrying value of the assets exceeded the fair value, the Company concluded it constituted a triggering event requiring assessment of impairment for its long-lived assets as of June 30, 2020. The Company performed an impairment analysis on each asset group and concluded the estimated undiscounted future cash flows were higher than their carrying amount and as such, no additional loss on impairment was recognized.