IMPPP Imperial Petroleum Inc

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No.    )^*

C3is INC.

(Name of Issuer)

Common Stock, par value $0.01 per share

(Title of Class of Securities)

Y18284 102

(CUSIP Number)

Imperial Petroleum Inc.

Attn: Harry N. Vafias

331 Kifissias Avenue

Erithrea 14561

Athens, Greece

011 30210 625 0001

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

With Copies To:

Finn Murphy, Esq.

Goodwin Procter LLP

620 Eighth Avenue

New York, New York 10018

(212) 459-7257

July 21, 2023

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box  ☐.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

(Continued on following pages)

This Schedule 13D relates to the common stock, par value $0.01 per share (“Common Stock”), of C3is Inc., a Marshall Islands corporation (the “Issuer”). The principal executive office of the Issuer is located at 331 Kifissias Avenue, Erithrea 14561, Athens, Greece. Information given in response to each item below shall be deemed incorporated by reference in all other items below.

(a). This statement on Schedule 13D is being filed by Imperial Petroleum Inc., a Marshall Islands corporation (“Imperial Petroleum” or the “Reporting Person”).

(b), (c) and (f). The address of the principal business and principal office of Imperial Petroleum is 331 Kifissias Avenue, Erithrea 14561, Athens, Greece. The principal business and occupation of Imperial Petroleum is marine transportation. Current information concerning the identity and background of each of the executive officers and directors of Imperial Petroleum is set forth on Annex A (collectively, the “Covered Persons”), attached hereto and incorporated herein by reference.

(d), (e). During the last five years, none of Imperial Petroleum, nor to the best of its knowledge, any Covered Person, has (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

On June 21, 2023, Imperial Petroleum effected a spin-off distribution (the “Spin-Off Distribution”) of all of the 3,182,932 outstanding shares of Common Stock of the Issuer, which was formed to act as the holding company for two drybulk carriers owned by Imperial Petroleum, to stockholders and warrantholders of Imperial Petroleum as of the close of business on June 13, 2023.

Immediately prior to the Spin-Off Distribution, in exchange for the contribution to the Issuer of the entities owning the two drybulk carriers comprising the Issuer’s initial fleet and $5,000,000 for working capital, on June 21, 2023, Imperial Petroleum received all of the Issuer’s issued and outstanding Common Stock and all 600,000 shares of the Issuer’s issued and outstanding Series A Convertible Preferred Stock, par value $0.01 per share, liquidation preference $25.00 per share (the “Series A Convertible Preferred Stock”). The Series A Convertible Preferred Stock has a cumulative dividend accruing at the rate of 5.0% per annum per liquidation preference of $25.00 per share, which may be paid in cash or, at the Issuer’s election, shares of Common Stock, quarterly in arrears. The Series A Convertible Preferred Stock will be convertible, commencing September 19, 2023, into Common Stock at the holder’s option, at a conversion price equal to 150% of the volume weighted average price per Common Share over the five consecutive trading day period commencing on the trading day immediately succeeding the June 21, 2023, original issue date of the Series A Convertible Preferred Stock (adjusted for any stock splits, reverse stock splits or stock dividends), which was $2.3340 per share. The conversion price is adjusted to the lowest price of issuance of common stock by the Issuer in any registered offering of common stock after the original issuance of Series A Convertible Preferred Stock on June 21, 2023, and, accordingly, has been adjusted to $1.05, the offering price to the investor of the units, comprised of one share of Common Stock and one Class A Warrant to purchase one share of Common Stock for $1.05 per share, in the Issuer’s registered public offering consummated on July 5, 2023. A copy of the form of Lockup Agreement entered into by the Reporting Person and each of the Covered Persons in connection with such offering is filed as Exhibit 3 and is incorporated herein by reference. The Series A Convertible Preferred Stock entitles Imperial Petroleum to the right to cast a number of votes for any matters on which the Issuer’s stockholders are entitled to vote equal to the number of shares of Common Stock into which such shares are convertible multiplied by 30, subject to certain limitations that will prevent Imperial Petroleum from exercising more than 49.99% of the aggregate voting power derived from any voting security then held by Imperial Petroleum on any matter put to stockholders of the Issuer.

Harry N. Vafias, the Chairman, Chief Executive Officer and President of Imperial Petroleum, is the Non-Executive Chairman of the Issuer and is the beneficial owner of 100,856 shares of Common Stock as of the date hereof. John Kostoyannis and George Xiradakis, each a director of Imperial Petroleum, are each a director of the Issuer and own 12 and nil shares of Common Stock, respectively, as of the date hereof. All of these shares of Common Stock were acquired by such persons in the Spin-Off Distribution.

The Reporting Person invested in the securities described in this Schedule 13D in connection with the Spin-Off Distribution, and intends to review its investment in the Issuer on a continuing basis. The Reporting Person may from time to time acquire additional securities of the Issuer, or retain or sell all or a portion of the shares then held by the Reporting Person, in the open market, block trades, underwritten public offerings or privately negotiated transactions. Any actions the Reporting Person might undertake with respect to its investment in the Issuer may be made at any time and from time to time and will be dependent upon the Reporting Person’s review of numerous factors, including, but not limited to: ongoing evaluation of the Issuer’s business, financial condition, operations, prospects and strategic alternatives; price levels of the Issuer’s securities; general market, industry and economic conditions; the relative attractiveness of alternative business and investment opportunities; tax considerations; liquidity of the Issuer’s securities; and other factors and future developments.

Mr. Vafias serves as the Non-Executive Chairman of the Issuer and John Kostoyannis and George Xiradakis each serve as directors of the Issuer and therefore these Covered Persons regularly engage in discussions with management of the Issuer, the board of directors of the Issuer, other shareholders of the Issuer and other relevant parties, which discussions may include matters ranging from the operations and conduct of the Issuer’s business to considering or exploring extraordinary corporate transactions including the events listed in Items 4(a) through 4(j) of Schedule 13D. In connection with these discussions, the Reporting Person may, either directly or through one or more affiliates, determine to take any available course of action or to take no course of action and may at any time and from time to time take steps to further or implement such course of action, including any of the events listed in Items 4(a) through 4(j) of Schedule 13D. Any action or actions the Reporting Person may undertake with respect to its investment in the Issuer or the operations and conduct of the Issuer’s business will be dependent upon the Reporting Person’s review of numerous factors, including those listed above, and the Reporting Person specifically reserves the right to change its intentions, or to formulate plans and proposals, with respect to any or all of the matters described in this paragraph, subject to applicable law and regulations.

(a) and (b) The responses of Imperial Petroleum to Rows (7) through (11) of the cover page of this Schedule are incorporated herein by reference.

Except as set forth herein, neither Imperial Petroleum nor, to the knowledge of Imperial Petroleum, the Covered Persons beneficially own any Common Stock as of the date of this filing.

(c) The information set forth in Item 3 is hereby incorporated herein by reference. Other than as set forth in this Schedule, neither Imperial Petroleum nor, to the best of its knowledge, any of the Covered Persons has engaged in any transaction in any Common Stock during the past 60 days.

(d) No other person is known to Imperial Petroleum to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the shares of the Common Stock covered by this Schedule.

(e) Not applicable.

Except for the relationships described above and in the responses to Items 4 and 5 herein, none of the Reporting Person, nor, to the best of its knowledge, any Covered Person has any contracts, arrangements, understandings or relationships (legal or otherwise) with any person, with respect to any securities of the Issuer.

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SIGNATURE

After reasonable inquiry and to the best of the knowledge and belief of the undersigned, the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: July 28, 2023

Annex A

IMPERIAL PETROLEUM INC.

331 Kifissias Avenue

Erithrea 14561

Athens, Greece

Directors and Executive Officers of Imperial Petroleum Inc.

As reported under Item 3, Messrs. Vafias, Kostoyannis and Xiradakis are each directors of C3is Inc.

Exhibit 3

LOCK-UP AGREEMENT

________, 2023

Maxim Group LLC

300 Park Avenue, 16^th Floor

New York, NY 10022

Ladies and Gentlemen:

The undersigned, a holder of shares of common stock, par value $0.01 per share (the “Shares”), or rights to acquire Shares, of C3is Inc., a company incorporated under the laws of the Republic of the Marshall Islands (the “Company”), understands that you are the placement agent (the “Placement Agent”) to the placement agency agreement (the “Placement Agreement”) to be entered into between the Placement Agent and the Company, providing for the public offering (the “Public Offering”) of units of the Company, each consisting of one Share or one pre-funded warrant to purchase one Share and one Class A warrant to purchase one Share (the “Securities”) pursuant to a Registration Statement on Form F-1 (File No. 333-_____) previously filed with U.S. Securities and Exchange Commission (the “SEC”). Capitalized terms used herein and not otherwise defined shall have the meanings set forth for them in the Placement Agreement.

In consideration of the Placement Agent’s agreement to enter into the Placement Agreement and to proceed with the Public Offering of the Securities, and for other good and valuable consideration, receipt of which is hereby acknowledged, the undersigned hereby agrees, for the benefit of the Company and the Placement Agent that, without the prior written consent of the Placement Agent, the undersigned will not, during the period specified in the following paragraph (the “Lock-Up Period”), directly or indirectly, unless otherwise provided herein, (a) offer, sell, agree to offer or sell, solicit offers to purchase, convert, exercise, exchange, grant any call option or purchase any put option with respect to, pledge, encumber, assign, borrow or otherwise dispose of or transfer (each a “Transfer”) any Relevant Security (as defined below) or otherwise publicly disclose the intention to do so, or (b) establish or increase any “put equivalent position” or liquidate or decrease any “call equivalent position” (in each case within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations thereunder) with respect to any Relevant Security, or otherwise enter into any swap, derivative or other transaction or arrangement that Transfers to another, in whole or in part, any economic consequence of ownership of a Relevant Security, whether or not such transaction is to be settled by the delivery of Relevant Securities, other securities, cash or other consideration, or otherwise publicly disclose the intention to do so. As used herein, the term “Relevant Security” means any Shares, warrant to purchase Shares or any other security of the Company or any other entity that is convertible into, or exercisable or exchangeable for, Shares or any other equity security of the Company, in each case owned beneficially or otherwise by the undersigned on the date set forth on the front cover of the final prospectus used in connection with the Public Offering of the Securities (the “Effective Date”) or acquired by the undersigned during the Lock-Up Period.

The Lock-Up Period will commence on the date of this Lock-up Agreement and continue and include the date that is ninety (90) days after the date of the Closing Date.

In addition, the undersigned further agrees that, without the prior written consent of the Placement Agent, during the Lock-Up Period the undersigned will not: (i) file or participate in the filing with the SEC of any registration statement or circulate or participate in the circulation of any preliminary or final prospectus or other disclosure document, in each case with respect to any proposed offering or sale of a Relevant Security, or (ii) exercise any rights the undersigned may have to require registration with the SEC of any proposed offering or sale of a Relevant Security.

In furtherance of the undersigned’s obligations hereunder, the undersigned hereby authorizes the Company during the Lock-Up Period to cause any transfer agent for the Relevant Securities to decline to transfer, and to note stop transfer restrictions on the stock register and other records relating to Relevant Securities for which the undersigned is the record owner and the transfer of which would be a violation of this Lock-Up Agreement and, in the case of Relevant Securities for which the undersigned is the beneficial but not the record owner, agrees that during the Lock-Up Period it will cause the record owner to cause the relevant transfer agent to decline to transfer, and to note stop transfer restrictions on the stock register and other records relating to such Relevant Securities to the extent such transfer would be a violation of this Lock-Up Agreement.

Notwithstanding the foregoing, the undersigned may transfer the undersigned’s Relevant Securities:

provided, in the case of clauses (i)-(vi), that (A) such transfer shall not involve a disposition for value, (B) the transferee agrees in writing with the Placement Agent and the Company to be bound by the terms of this Lock-Up Agreement, and (C) such transfer would not require any filing under Section 16(a) of the Exchange Act and no such filing is voluntarily made; and provided, further, in the case of clause (vii), that the equity awards being exercised or that have vested were outstanding prior to the date of the Placement Agreement and that such equity awards have not been amended since the date of the Placement Agreement.

For purposes of this Lock-Up Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin.

The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Lock-Up Agreement and that this Lock-Up Agreement has been duly authorized (if the undersigned is not a natural person) and constitutes the legal, valid and binding obligation of the undersigned, enforceable in accordance with its terms. Upon request, the undersigned will execute any additional documents necessary in connection with the enforcement hereof. Any obligations of the undersigned shall be binding upon the successors and assigns of the undersigned from the date of this Lock-Up Agreement.

The undersigned understands that, if the Placement Agreement does not become effective, or if the Placement Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Securities to be sold in connection with the Public Offering, the undersigned shall be released from all obligations under this Lock-Up Agreement.

The undersigned, whether or not participating in the Public Offering, understands that the Placement Agent is entering into the Placement Agreement and proceeding with the Public Offering in reliance upon this Lock-Up Agreement.

The undersigned hereby irrevocably submits to the exclusive jurisdiction of the United States District Court sitting in the Southern District of New York and the courts of the State of New York located in Manhattan, for the purposes of any suit, action or proceeding arising out of or relating to this letter agreement, and hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that (i) it is not personally subject to the jurisdiction of such court, (ii) the suit, action or proceeding is brought in an inconvenient forum, or (iii) the venue of the suit, action or proceeding is improper. The undersigned hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by receiving a copy thereof sent to the Company at the address in effect for notices to it under the Placement Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. The undersigned hereby waives any right to a trial by jury. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. The undersigned agrees and understands that this letter agreement does not intend to create any relationship between the undersigned and the Placement Agent and that no issuance or sale of the Securities is created or intended by virtue of this letter agreement.

This Lock-Up Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws principles thereof. Delivery of a signed copy of this Lock-Up Agreement by facsimile or e-mail/.pdf transmission shall be effective as the delivery of the original hereof.