Eagle Bulk posts slim first-quarter profit

Eagle-Bulk-Shipping

Eagle Bulk, one of the world’s largest owner-operators within the Supramax / Ultramax segment, reported financial results for the three months ended March 31, 2019.

Highlights for the Quarter:

  • Generated net revenues of $77.4 million, representing a decrease of $2.0 million or 2% compared to the same period in 2018.
    – TCE Revenue (1) for the quarter equated to $40.0 million, a decrease of 14% year-on-year.
    – Achieved a TCE (2) of $9,607 for the quarter, a decrease of 13% year-on-year.
  • Realized a net income of $29 thousand or $0.00 per basic and diluted share, compared to a net income of $53 thousand or $0.00 per basic and diluted share in the first quarter 2018.
    – Net income excluding loss on debt extinguishment of $2.3 million or $0.03 per basic and diluted share.
  • Adjusted EBITDA(3) of $15.4 million, representing a decrease of $3.5 million or 18% compared to the same period in 2018.
  • Looking ahead into the second quarter of 2019, the Company has attained a TCE of $9,509 with approximately 65% of the available days fixed for the period thus far.

Gary Vogel, Eagle Bulk’s CEO, commented, “Notwithstanding weakness in freight markets during the first quarter, we were able to achieve our highest TCE outperformance to date. I am pleased to report that our first quarter TCE outperformance, relative to the adjusted benchmark Baltic Supramax Index equated to almost $2,400 per vessel per day, representing a beat of over 30%. With nine consecutive quarters of outperformance, we continue to demonstrate our ability to create value through the execution of our differentiated business model.

“With respect to our fleet, preparations for IMO 2020 are well underway. To date we have fitted five vessels with scrubbers, with the majority of the installation time occurring at sea while ships continue to trade. We expect to have thirty-four scrubbers installed within 2019, and three additional units in 2020.”

1 TCE revenue is a non-GAAP financial measure. See the reconciliation and table of net revenues to TCE later in this release for more information on non-GAAP measures.
TCE is a non-GAAP financial measure. See the reconciliation and the table of net revenues to TCE later in this release for more information on non-GAAP measures.
3 Adjusted EBITDA is a non-GAAP financial measure. See the reconciliation and table of net income/(loss) to EBITDA and Adjusted EBITDA later in this release for more information on non-GAAP financial measures.

Fleet Operating Data

Three Months Ended
March 31, 2019 March 31, 2018
Ownership Days 4,160 4,312
Chartered in Days 1,036 944
Available Days 5,106 5,162
Operating Days 5,070 5,113
Fleet Utilization (%) 99.3 % 99.1 %

Fleet Development

Vessels acquired and delivered into the fleet

  • Cape Town Eagle, an Ultramax (64k DWT / 2015-built) for $20.4 million.

Vessels sold

  • Condor (50k DWT / 2001-built) and Merlin (50k DWT /2001-built) for $12.8 million, net of selling expenses and commissions.

Vessels sold after quarter-end

  • Signed a memorandum of agreement to sell the vessel Thrasher (53k DWT / 2010-built) for gross proceeds of $10.0 million.

Results of Operations for the three months ended March 31, 2019 and 2018

For the three months ended March 31, 2019, the Company reported net income of $29 thousand, or basic and diluted income of $0.00 per share. In the comparable quarter of 2018, the Company reported net income of $53 thousand, or basic and diluted income of $0.00 per share.

Net time and voyage charter revenues

Net time and voyage charter revenues for the three months ended March 31, 2019 were $77.4 million compared with $79.4 million recorded in the comparable quarter in 2018. The decrease in revenue was primarily attributable to the decline in the dry bulk market resulting in lower charter rates and a decrease in available days due to lower ownership days in the current quarter resulting from the sale of two vessels, Condor and Merlin. Additionally, the Company purchased one vessel in the current quarter as well as in the comparable quarter in 2018.

Voyage expenses

Voyage expenses for the three months ended March 31, 2019 were $25.9 million compared to $22.5 million in the comparable quarter in 2018. The increase was mainly attributable to an increase in bunker prices year over year.

Vessel expenses

Vessel expenses for the three months ended March 31, 2019 were $20.1 million compared to $21.1 million in the comparable quarter in 2018. The decrease in vessel expenses was attributable to a decrease in owned days after the sale of the vessels, Condor and Merlin in the current quarter compared to the comparable period in the prior year. The ownership days for the three months ended March 31, 2019 and 2018 were 4,160 and 4,312, respectively.

Average daily vessel operating expenses for our fleet for the three months ended March 31, 2019 and 2018 were $4,830 and $4,888, respectively.

Charter hire expenses

Charter hire expenses for the three months ended March 31, 2019 were $11.5 million compared to $10.3 million in the comparable quarter in 2018. The increase in charter hire expenses was principally due to an increase in the number of chartered in vessels on a short-term basis as well as the increase in the average charter hire expense per day. The total chartered in days for the three months ended March 31, 2019 were 1,036 compared to 944 for the comparable quarter in the prior year. The Company currently charters-in three Ultramax vessels on long term basis with lease terms ranging from one to three years.

Depreciation and amortization

Depreciation and amortization expense for the three months ended March 31, 2019 and 2018 was $9.4 million and $9.3 million, respectively. Total depreciation and amortization expense for the three months ended March 31, 2019 includes $8.2 million of vessel and other fixed asset depreciation and $1.2 million relating to the amortization of deferred drydocking costs. Comparable amounts for the three months ended March 31, 2018 were $8.1 million of vessel and other fixed asset depreciation and $1.2 million of amortization of deferred drydocking costs.

General and administrative expenses

General and administrative expenses for the three months ended March 31, 2019 and 2018 were $8.4 million and $9.9 million, respectively. General and administrative expenses included stock-based compensation of $1.4 million and $3.5 million for the three months ended March 31, 2019 and 2018, respectively. The decrease in the general and administrative expenses was mainly due to a decrease in stock-based compensation expense.

Interest expense

Interest expense for the three months ended March 31, 2019 and 2018 was $6.8 million and $6.3 million, respectively. The increase in interest expense is primarily due to an increase in our outstanding debt as a result of the purchase of two new Ultramax vessels since the first quarter of 2018.

Loss on debt extinguishment

On January 25, 2019, the Company repaid the outstanding debt together with accrued interest as on that date under the New First Lien Facility and Original Ultraco Debt Facility and discharged the debt in full from the proceeds of the New Ultraco Debt Facility. The Company accounted for the above transaction as a debt extinguishment. As a result, the Company recognized $2.3 million representing the outstanding balance of debt issuance costs as a loss on debt extinguishment in the Condensed Consolidated Statement of Operations for the three months ended March 31, 2019.

Liquidity and Capital Resources

Net cash provided by operating activities for the three months ended March 31, 2019 was $11.9 million, compared with $14.9 million in the comparable period in 2018. The cash flows from operating activities decreased over the prior year primarily due to a decrease in the charter hire rates achieved by the Company in the current year as well as an increase in drydocking costs.

Net cash used in investing activities for the three months ended March 31, 2019 was $16.9 million, compared to $15.3 million in the comparable period in the prior year. The Company purchased one Ultramax vessel for $20.4 million, out of which $2.0 million was paid as an advance as of December 31, 2018 offset by the proceeds from the sale of two vessels for $12.8 million. Additionally, the Company paid $11.2 million for the purchase and installation of scrubbers and ballast water treatment systems on our fleet. During the first quarter of 2018, the Company purchased one Ultramax vessel for $19.8 million and redeemed a short-term certificate of deposit amounting to $4.5 million.

Net cash provided by financing activities for the three months ended March 31, 2019 was $6.8 million compared with $2.1 million in the comparable three month period in 2018. On January 25, 2019, the Company completed a debt refinancing transaction by entering into new term and revolver loan facilities under the New Ultraco Debt Facility of up to $208.4 million and repaid all outstanding debt under the Original Ultraco Debt Facility and New First Lien Facility of $82.6 million and $65.0 million respectively. The Company paid $3.2 million as debt issuance costs to the lenders. Additionally, the Company paid $0.9 million towards shares withheld for taxes due to the vesting of restricted shares. For the three months ended March 31, 2018, the Company drew down $8.6 million under the Original Ultraco Debt Facility in connection with the purchase of one Ultramax vessel, offset by repayment of $5.0 million of the revolver loan under the New First Lien Facility. The Company paid $1.2 million of debt issuance costs on the debt facilities and $0.3 million towards shares withheld for taxes due to vesting of restricted shares.

As of March 31, 2019, our cash and cash equivalents balance including restricted cash was $80.0 million compared to a cash, cash equivalents, and restricted cash balance of $78.2 million as of December 31, 2018.

As of March 31, 2019, the total availability under the New Ultraco Debt Facility revolving credit facility is $55.0 million and $15.0 million under the Super Senior Facility.

As of March 31, 2019, the Company’s outstanding debt consisted of the $196.0 million Norwegian Bond and the $153.4 million New Ultraco Debt Facility.

Capital Expenditures and Drydocking

Our capital expenditures relate to the purchase of vessels and capital improvements to our vessels, which are expected to enhance the revenue earning capabilities and safety of the vessels.

In addition to acquisitions that we may undertake in future periods, the Company’s other major capital expenditures include funding the Company’s program of regularly scheduled drydocking necessary to comply with international shipping standards and environmental laws and regulations. Although the Company has some flexibility regarding the timing of its drydocking, the costs are relatively predictable. Management anticipates that vessels are to be drydocked every two and a half years for vessels older than 15 years and five years for vessels younger than 15 years. Funding of these requirements is anticipated to be met with cash from operations. We anticipate that this process of recertification will require us to reposition these vessels from a discharge port to shipyard facilities, which will reduce our available days and operating days during that period.

Drydocking costs incurred are deferred and amortized to expense on a straight-line basis over the period through the date of the next scheduled drydocking for those vessels. In the three months ended March 31, 2019, three of our vessels completed drydock and one vessel is in drydock as of March 31, 2019 and we incurred $2.5 million in drydocking related costs. In the three months ended March 31, 2018, two vessels were drydocked and we incurred $1.1 million in drydocking related costs

The following table represents certain information about the estimated costs for anticipated vessel drydockings, Ballast water treatment systems (“BWTS”), and Scrubber installations in the next four quarters, along with the anticipated off-hire days:

Projected Costs(2) (in millions)
Quarter Ending Off-hire Days(1) BWTS Scrubbers Drydocks
June 30, 2019 177 $ 2.5 $ 24.1 $ 1.8
September 30, 2019 162 $ 3.4 $ 16.6 $ 2.3
December 31, 2019 246 $ 2.6 $ 12.9 $ 5.1
March 31, 2020 31 $ 1.5 $ 3.8 $ 0.8
(1) Actual duration of off-hire days will vary based on the condition of the vessel, yard schedules and other factors.
(2) Actual costs will vary based on various factors, including where the drydockings are actually performed.

SUMMARY CONSOLIDATED FINANCIAL AND OTHER DATA

The following table summarizes the Company’s selected condensed consolidated financial and other data for the periods indicated below.

 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
March 31, 2019 March 31, 2018
Revenues, net $ 77,389,597 $ 79,370,609
Operating expenses:
Voyage expenses 25,906,140 22,514,592
Vessel expenses 20,093,706 21,078,657
Charter hire expenses 11,491,906 10,268,064
Depreciation and amortization 9,407,108 9,276,415
General and administrative expenses 8,409,919 9,913,964
Gain on sale of vessels (4,106,547 )
Total operating expenses 71,202,232 73,051,692
Operating income 6,187,365 6,318,917
Interest expense 6,762,003 6,261,069
Interest income (434,318 ) (95,276 )
Loss on debt extinguishment 2,268,452
Other (income)/expense (2,438,255 ) 100,379
Total other expense, net 6,157,882 6,266,172
Net income $ 29,483 $ 52,745
Weighted average shares outstanding:
Basic 71,283,301 70,452,814
Diluted 72,070,868 71,531,864
Per share amounts:
Basic income $ $
Diluted income $ $
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, 2019 December 31, 2018
ASSETS:
Current assets:
Cash and cash equivalents $ 60,715,204 $ 67,209,753
Accounts receivable, net of a reserve of $1,758,463 and $2,073,616, respectively 18,975,479 19,785,582
Prepaid expenses 3,941,090 4,635,879
Inventories 13,137,786 16,137,785
Vessels held for sale 8,458,444
Other current assets 3,242,311 2,246,740
Total current assets 100,011,870 118,474,183
Noncurrent assets:
Vessels and vessel improvements, at cost, net of accumulated depreciation of $133,015,330 and $124,907,998, respectively 695,343,213 682,944,936
Advance for vessel purchase 2,040,000
Operating lease right-of-use assets (1) 25,433,893
Other fixed assets, net of accumulated depreciation of $610,970 and $547,452, respectively 655,648 692,803
Restricted cash 19,283,145 10,953,885
Deferred drydock costs, net 13,219,645 12,186,356
Deferred financing costs – Super Senior Facility 285,342 285,342
Other assets 28,772,636 18,631,655
Total noncurrent assets 782,993,522 727,734,977
Total assets $ 883,005,392 $ 846,209,160
LIABILITIES & STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 13,694,404 $ 14,161,169
Accrued interest 6,990,987 1,735,631
Other accrued liabilities 9,109,295 10,064,017
Fair value of derivatives 929,313
Current portion of operating lease liabilities (1) 13,775,046
Unearned charter hire revenue 5,173,582 6,926,839
Current portion of long-term debt 28,194,684 29,176,230
Total current liabilities 76,937,998 62,993,199
Noncurrent liabilities:
Norwegian Bond Debt, net of debt discount and debt issuance costs 182,817,726 182,469,155
New First Lien Facility, net of debt discount and debt issuance costs 48,189,307
Original Ultraco Debt Facility, net of debt discount and debt issuance costs 70,924,885
New Ultraco Debt Facility, net of debt discount and debt issuance costs 129,903,085
Operating lease liabilities (1) 13,142,943
Other liabilities 208,651
Fair value below contract value of time charters acquired 1,818,114
Total noncurrent liabilities 325,863,754 303,610,112
Total liabilities 402,801,752 366,603,311
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $.01 par value, 25,000,000 shares authorized, none issued as of March 31, 2019 and December 31, 2018
Common stock, $.01 par value, 700,000,000 shares authorized, 71,348,411 and 71,055,400 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively 713,484 710,555
Additional paid-in capital 894,837,912 894,272,533
Accumulated deficit (415,347,756 ) (415,377,239 )
Total stockholders’ equity 480,203,640 479,605,849
Total liabilities and stockholders’ equity $ 883,005,392 $ 846,209,160

(1) We adopted the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) as of January 1, 2019 and recognized operating right-of-use assets related to time charter in contracts over 12 months and the office leases the Company is currently leasing in Stamford, Connecticut and Singapore. The Company recognized operating right-of-use assets of $28.7 million and operating liabilities of $30.5 million as of January 1, 2019, and operating right of use assets of $25.4 million and operating liabilities of $26.9 million as of March 31, 2019.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended
March 31, 2019 March 31, 2018 
Cash flows from operating activities:
Net income $ 29,483 $ 52,745
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 8,168,411 8,073,353
Amortization of operating lease right-of-use asset 3,271,111
Amortization of deferred drydocking costs 1,238,698 1,203,062
Amortization of debt discount and debt issuance costs 503,716 490,095
Amortization of fair value below contract value of time charter acquired (170,475 )
Loss on debt extinguishment 2,268,452
Gain on sale of vessels, net (4,106,547 )
Net unrealized (gain)/loss on fair value of derivatives (2,958,154 ) 208,235
Stock-based compensation expense 1,445,469 3,510,911
Drydocking expenditures (2,527,553 ) (1,107,414 )
Changes in operating assets and liabilities:
Accounts payable 1,467,508 1,544,461
Accounts receivable 810,103 3,270,432
Accrued interest 5,255,356 4,122,188
Inventories 2,999,999 490,738
Operating lease liabilities short and long-term (3,643,179 )
Other current and non-current assets 1,084,257 (121,954 )
Other current and non-current liabilities (2,306,786 ) (5,009,784 )
Prepaid expenses 694,789 (652,271 )
Unearned revenue (1,753,257 ) (1,031,082 )
Net cash provided by operating activities 11,941,876 14,873,240
Cash flows from investing activities:
Advance paid for purchase of scrubbers and ballast water systems (11,244,778 )
Proceeds from redemption of short-term investment 4,500,000
Proceeds from sale of vessels 12,820,557
Purchase of other fixed assets (23,924 ) 966
Purchase of vessels and vessel improvements (18,465,609 ) (19,841,535 )
Net cash used in investing activities (16,913,754 ) (15,340,569 )
Cash flows from financing activities:
Repayment of revolver loan under New First Lien Facility (5,000,000 ) (5,000,000 )
Proceeds from the revolver under New First Lien  Facility 5,000,000
Proceeds from Original Ultraco Debt Facility 8,600,000
Repayment of Original Ultraco Debt Facility (82,600,000 )
Proceeds from New Ultraco Debt Facility 153,440,000
Repayment of New First Lien Facility – term loan (60,000,000 )
Debt issuance costs paid to lenders on New Ultraco Debt Facility (3,156,250 )
Cash used to settle net share equity awards (877,161 ) (254,146 )
Other financing costs (1,231,935 )
Net cash provided by financing activities 6,806,589 2,113,919
Net increase in cash, cash equivalents and restricted cash 1,834,711 1,646,590
Cash, cash equivalents and restricted cash at beginning of period 78,163,638 56,325,961
Cash, cash equivalents and restricted cash at end of period $ 79,998,349 $ 57,972,551
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the period for interest $ 901,516 $ 1,648,787
Accrual for other financing costs included in Other accrued liabilities $ 300,000 $
Accruals for Scrubbers and ballast water treatment systems included in Accounts payable and Other accrued liabilities $ 4,749,057 $

Reconciliation of Net income/(loss) to EBITDA and Adjusted EBITDA

In addition to the Company’s financial results reported in accordance with accounting principles generally accepted in the United States of America (“GAAP”) included in this press release, the Company has provided certain financial measures that are not calculated according to GAAP, including EBITDA and Adjusted EBITDA. We define EBITDA as net income under GAAP adjusted for interest, income taxes, depreciation and amortization.

Adjusted EBITDA is a non-GAAP financial measure that is used as a supplemental financial measure by our management and by external users of our financial statements, such as investors, commercial banks and others, to assess our operating performance as compared to that of other companies in our industry, without regard to financing methods, capital structure or historical costs basis. Our Adjusted EBITDA should not be considered an alternative to net income/(loss), operating income/(loss), cash flows provided by/(used in) operating activities or any other measure of financial performance or liquidity presented in accordance with U.S. GAAP. Our Adjusted EBITDA may not be comparable to similarly titled measures of another company because all companies may not calculate Adjusted EBITDA in the same manner.  Adjusted EBITDA represents EBITDA adjusted to exclude the items which represent certain non-cash, one-time and other items such as vessel impairment, gain /(loss) on sale of vessels, restructuring expenses, loss on debt extinguishment and stock-based compensation expenses that the Company believes are not indicative of the ongoing performance of its core operations. The following table presents a reconciliation of our net income to EBITDA and Adjusted EBITDA.

Three Months Ended 
March 31, 2019 March 31, 2018
Net income $ 29,483 $ 52,745
Adjustments to reconcile net income to EBITDA:
Interest expense 6,762,003 6,261,069
Interest income (434,318 ) (95,276 )
Income taxes
EBIT 6,357,168 6,218,538
Depreciation and amortization 9,407,108 9,276,415
EBITDA 15,764,276 15,494,953
Non-cash, one-time and other adjustments to EBITDA(1): (392,626 ) 3,340,436
Adjusted EBITDA $ 15,371,650 $ 18,835,389

(1) One-time and other adjustments to EBITDA for the three months ended March 31, 2019 includes stock-based compensation, (gain)/loss on sale of vessels and loss on debt extinguishment. One-time and other adjustments to EBITDA for the three months ended March 31, 2018 includes stock-based compensation, (gain)/loss on sale of vessels, loss on debt extinguishment and amortization of fair value below contract value of time charter acquired.

Reconciliation of net revenues to TCE

Time charter equivalent (“TCE”) is a non-GAAP financial measure that is commonly used in the shipping industry primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per-day amounts while charter hire rates for vessels on time charters generally are expressed in such amounts. The Company defines TCE as shipping revenues less voyage expenses and charter hire expenses, adjusted for the impact of one legacy time charter and realized gains on FFAs and bunker swaps, divided by the number of owned available days. TCE provides additional meaningful information in conjunction with shipping revenues, the most directly comparable GAAP measure, because it assists Company management in making decisions regarding the deployment and use of its vessels and in evaluating their financial performance. The Company’s calculation of TCE may not be comparable to that reported by other companies. The Company calculates relative performance by comparing TCE against the Baltic Supramax Index (“BSI”) adjusted for commissions and fleet makeup. Owned available days is the number of our ownership days less the aggregate number of days that our vessels are off-hire due to vessel familiarization upon acquisition, repairs, vessel upgrades or special surveys. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.

The following table presents the reconciliation of revenues, net to TCE:

Three Months Ended 
March 31,
2019
March 31,
2018
Revenues, net $ 77,389,597 $ 79,370,609
Less:
Voyage expenses (25,906,140 ) (22,514,592 )
Charter hire expenses (11,491,906 ) (10,268,064 )
Reversal of one legacy time charter (414,140 ) (86,487 )
Realized gain on FFAs and bunker swaps (475,523 ) 116,982
TCE revenue $ 39,101,888 $ 46,618,448
Owned available days 4,070 4,218
TCE $ 9,607 $ 11,052

Glossary of Terms:

Ownership days: We define ownership days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we recorded during a period.

Chartered-in under operating lease days: We define chartered-in under operating lease days as the aggregate number of days in a period during which we chartered-in vessels. Periodically, the Company charters in vessels on a single trip basis.

Available days: We define available days as the number of our ownership days and chartered-in days less the aggregate number of days that our vessels are off-hire due to vessel familiarization upon acquisition, repairs, vessel upgrades or special surveys. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.

Operating days: We define operating days as the number of available days in a period less the aggregate number of days that our vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.

Fleet utilization: We calculate fleet utilization by dividing the number of our operating days during a period by the number of our available days during the period. The shipping industry uses fleet utilization to measure a company’s efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs or repairs under guarantee, vessel upgrades, special surveys or vessel positioning. Our fleet continues to perform at high utilization rates.

Definitions of capitalized terms related to our Indebtedness

Norwegian Bond Debt: Norwegian Bond Debt refers to the Senior Secured Bonds issued by Eagle Bulk Shipco LLC, a wholly-owned subsidiary of the Company (“Shipco”), as borrower, certain wholly-owned vessel-owning subsidiaries of Shipco, as guarantors (“Shipco Vessels”), on November 28, 2017 for $200.0 million, pursuant to those certain Bond Terms, dated as of November 22, 2017, by and between Shipco, as issuer, and Nordic Trustee AS, a company existing under the laws of Norway (the “Bond Trustee”). The bonds are secured by 25 vessels.

New Ultraco Debt Facility: New Ultraco Debt Facility refers to senior secured credit facility for $208.4 million entered into by Ultraco Shipping LLC (“Ultraco”), a wholly-owned subsidiary of the Company, as the borrower (the “New Ultraco Debt Facility”), with the Company and certain of its indirectly vessel-owning subsidiaries, as guarantors (the “Guarantors”), the lenders party thereto, the swap banks party thereto, ABN AMRO Capital USA LLC (“ABN AMRO”), Credit Agricole Corporate and Investment Bank, Skandinaviska Enskilda Banken AB ( PUBL) and DNB Markets Inc., as mandated lead arrangers and bookrunners, and ABNAMRO, as arranger, security trustee and facility agent. The New Ultraco Debt Facility provides for an aggregate principal amount of $208.4 million, which consists of (i) a term loan facility of $153.4 million and (ii) a revolving credit facility of $55.0 million. As of March 31, 2019, the $55.0 million revolving credit facility remains undrawn. The New Ultraco Debt Facility is secured by 21 vessels.

New First Lien Facility: New First Lien Facility refers to the credit facility for $65.0 million (term loan and revolver) entered into by and among Eagle Shipping LLC, a wholly-owned subsidiary of the Company (“Eagle Shipping”), as borrower, certain wholly-owned vessel-owning subsidiaries of Eagle Shipping, as guarantors, the lenders thereunder, the swap banks party thereto, ABN AMRO Capital USA LLC, as facility agent and security trustee for the Lenders, ABN AMRO Capital USA LLC, Credit Agricole Corporate and Investment Bank and Skandinaviska Enskilda Banken AB (publ), as mandated lead arrangers, and ABN AMRO Capital USA LLC, as arranger and bookrunner on December 8, 2017. The outstanding debt under the New First Lien Facility was repaid in full in the first quarter of 2019 with proceeds from the New Ultraco Debt Facility.

Original Ultraco Debt Facility: Original Ultraco Debt Facility refers to the credit facility for $82.6 million entered into by and among Eagle Bulk Ultraco LLC, a wholly-owned subsidiary of the Company (“Ultraco”), as borrower, certain wholly-owned vessel-owning subsidiaries of Ultraco, as guarantors, the lenders thereunder, the swap banks party thereto, ABN AMRO Capital USA LLC (“ ABN AMRO”), as facility agent and security trustee for the Ultraco Lenders, ABN AMRO, DVB Bank SE and Skandinaviska Enskilda Banken AB (publ), as mandated lead arrangers, and ABN AMRO, as arranger and bookrunner on June 28, 2017. The proceeds were used to finance the acquisition of nine Ultramax vessels during 2017 and two Ultramax vessels during 2018. The Original Ultraco Debt Facility was repaid in full in the first quarter of 2019 with proceeds from the New Ultraco Debt Facility.

 

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