Seanergy Maritime Holdings Corp. (“Seanergy” or the “Company”)
(NASDAQ: SHIP) announced today that it has reached final agreements
with certain of its senior lenders and junior lender, for the
financial restructuring of a total of $179 million, consisting of
four senior credit facilities (the “Senior Facilities”), three
junior credit facilities (the “Jelco Loans”) and three junior
convertible notes (the “Jelco Notes”). Following these agreements,
the previously announced defaults and cross-defaults have been
fully resolved.
Pursuant to the restructuring terms,
approximately $87 million of debt maturities falling due in 2020
have been extended to future periods, between December 2022 and
December 2024, providing Seanergy with a clean two-year runway. In
addition, the rescheduling of the amortization payments under
certain of the Senior Facilities and the reduction of the interest
rate across the junior loans and notes are expected to have a
positive impact on the cash break-even of the Company going
forward. Moreover, the Company’s lenders have agreed to cancel or
amend certain financial covenants and security maintenance
provisions under the Senior Facilities allowing for additional
financial flexibility, including payment of dividends.
Stamatis Tsantanis, the Company’s
Chairman and Chief Executive Officer stated:
“We are very pleased to announce the successful
conclusion of the restructuring discussions with certain of our
lenders. The discussions extended since the first quarter of 2020
and were finally concluded in an amicable manner. The agreed
solutions provide Seanergy with a solid financial standing going
forward, allowing us to pursue our strategy to enhance corporate
value and pave the way to improved shareholder returns.
Under the agreed restructuring, there are no
imminent loan maturities or underlying defaults, our balance sheet
has been delevered through the extinguishment of debt and accrued
interest and our future cash flow is expected to improve through
reduced interest expense and debt amortization payments in the next
years. Our overall debt has seen an impressive year-over-year
reduction of $36.0 million through the restructuring initiatives
and the uninterrupted servicing of the scheduled amortization
payments.
Despite the global challenges presented in 2020,
we have delivered milestone transactions, including the prominent
restructuring of our debt, fleet expansion and beneficial
commercial agreements. Seanergy, as the only pure-play Capesize
vessel owner listed in the US capital markets, is in a great
position to capture what we believe is significant upside potential
in a rising market.”
A summary of the various restructuring
arrangements is presented below:
Alpha Bank SA (“Alpha Bank”) Extension
and Amendments
As previously disclosed, we documented the
agreement with Alpha Bank for the extension of two loan facilities
secured by two of our Capesize vessels from March 17, 2020 and
November 10, 2021, to December 31, 2022. The underlying terms
remained substantially the same while in addition, certain
corporate covenants and dividend restrictions were cancelled or
relaxed. We are currently in compliance with all the terms of these
facilities as amended.
Hamburg Commercial Bank AG (“HCOB”)
Refinancing and Entrust Global Facility (“Entrust
facility”)
As previously disclosed, we entered into a
settlement agreement with HCOB for the facility secured by two of
our Capesize vessels, under which the $29.1 million outstanding
balance was settled for $23.5 million resulting in a $5.6 million
debt extinguishment and an equivalent gain for Seanergy. The HCOB
facility was refinanced by a new facility provided by certain
nominees of Entrust Global and secured by the same vessels. The
Entrust facility with an initial balance of $22.5 million, has a
five-year term and reduced quarterly repayments that have
positively impacted the break-even rates of the underlying vessels,
as well as less restrictive financial covenants and value
maintenance provisions. These developments resulted in a $6.6
million aggregate reduction in the Company’s debt. We are currently
in compliance with all the terms of the Entrust facility.
UniCredit Bank AG (“UCB”) Extension and
Amendments
The Company obtained credit committee approval
for the extension of the maturity of the UCB facility secured by
two of its Capesize vessels, by two years, from December 2020 to
December 2022. Moreover, the approval provides for the cancellation
of various financial covenants and value maintenance provisions.
Most importantly, the lender has agreed to the reduction of the
quarterly installments from $1.55 million to $1.2 million, on the
basis of which, the all-in cash break-even of the underlying
vessels has improved by approximately $1,900 per day. The agreement
is subject to completion of definitive documentation.
Amsterdam Trade Bank (“ATB”)
Amendments
The Company received credit committee approval
from ATB concerning the amendment of the value maintenance
provisions and of certain financial covenants under the ATB
facility secured by one of our Capesize vessels. Such amendments
will address potential non-compliance issues while providing for a
uniform approach in the financial covenants across all of the
Company’s senior loan facilities. The agreement is subject to
completion of definitive documentation.
Jelco Loans and Notes Extensions and
Amendments
On December 30, 2020 we entered into definitive
documentation with Jelco Delta Holding Corp. (“Jelco”), the
Company’s sole junior creditor, concerning $27.2 million of
maturities falling due in 2020 and the settlement of accrued and
unpaid interest through December 31, 2020. Jelco is a former
affiliate of and related party to the Company and pursuant to this
agreement, $6.5 million of principal indebtedness under one of the
Jelco Loans was repaid, while all other maturities, including those
of two Jelco Notes that were maturing in December 2022, were
extended to December 2024. In addition, Jelco has agreed to the
reduction of the applicable interest rate across all Jelco Loans
and Jelco Notes to a fixed rate of 5.5% (previously floating based
on LIBOR plus a spread ranging from 5% to 8.5%). Moreover, we have
agreed to introduce two interim repayment instalments of $8.0
million each, payable in December 2022 and December 2023 and a
semi-annual cash sweep mechanism capturing cash balances in excess
of $25.0 million or time charter equivalent revenue of our Capesize
fleet between $18,000 and $21,000, provided that such repayment
obligations, together with all other prepayment obligations to
Jelco, will not exceed $12 million in any calendar year. These
arrangements will provide for the swift reduction of the Jelco debt
to the extent the free cash flows of the Company permit.
Moreover, Seanergy and Jelco have agreed to the
settlement of all accrued and unpaid interest through December 31,
2020 and other fees payable to Jelco in an aggregate amount of
approximately $5.6 million, through a private placement of units
consisting of one common share (or one pre-funded warrant in lieu
of one common share) and one warrant to purchase one common share
for a fixed price of $0.70. The issuance of these common shares and
warrants closed on January 8, 2021. Each unit was issued at a price
of $0.70, in line with the pricing of the Company’s public offering
that closed in August 2020 and represents a 39% premium compared to
the closing price of the Company’s shares on the date of signing of
the agreement. The terms of the warrants and pre-funded warrants
are substantially the same as those of the Class E warrants and
pre-funded warrants issued in the Company’s public offering in
August 2020. The Company has also granted an option to Jelco to
convert up to $3.0 million of principal indebtedness under one of
the Jelco Loans at the same terms and pricing. Seanergy has also
agreed to amend the conversion price of the Jelco Notes to $1.20
per share, which represents an approximately 139 % premium compared
to the closing price of the Company’s shares on the date of signing
of the agreement. As part of the transaction, Jelco waived any and
all past breaches or events of default under the Jelco Loans and
Jelco Notes.
The acquisition of shares by Jelco is subject to
a standstill undertaking and 9.99% beneficial ownership blockers,
precluding the acquisition of the Company’s shares, including
through the exercise of warrants or the conversion of the Jelco
Notes to the extent that it would result in Jelco or its affiliates
beneficially owning, including control over the voting or
disposition of, more than 9.99% of the outstanding common shares of
the Company after giving effect to the acquisition. The Company has
granted customary registration rights with respect to all shares
issued or issuable to Jelco as a result of this transaction,
including the shares underlying the Jelco Notes, and has undertaken
to file a registration statement covering the resale of these
shares.
About Seanergy Maritime Holdings Corp.
Seanergy Maritime Holdings Corp. is the only
pure-play Capesize ship-owner publicly listed in the US. Seanergy
provides marine dry bulk transportation services through a fleet of
11 Capesize vessels with an average age of about 12 years and
aggregate cargo carrying capacity of approximately 1,926,117 dwt.
The Company is incorporated in the Marshall Islands and has
executive offices in Glyfada, Greece. The Company's common shares
trade on the Nasdaq Capital Market under the symbol "SHIP", its
Class A warrants under "SHIPW" and its Class B warrants under
“SHIPZ”.
Please visit our company website at:
www.seanergymaritime.com
Forward-Looking Statements
This press release contains forward-looking
statements (as defined in Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended) concerning future events. Words such as "may",
"should", "expects", "intends", "plans", "believes", "anticipates",
"hopes", "estimates" and variations of such words and similar
expressions are intended to identify forward-looking statements.
These statements involve known and unknown risks and are based upon
a number of assumptions and estimates, which are inherently subject
to significant uncertainties and contingencies, many of which are
beyond the control of the Company. Actual results may differ
materially from those expressed or implied by such forward-looking
statements. Factors that could cause actual results to differ
materially include, but are not limited to, the Company's operating
or financial results; the Company's ability to continue as a going
concern; the Company’s liquidity, including its ability to service
its indebtedness; competitive factors in the market in which the
Company operates; shipping industry trends, including charter
rates, vessel values and factors affecting vessel supply and
demand; future, pending or recent acquisitions and dispositions,
business strategy, areas of possible expansion or contraction, and
expected capital spending or operating expenses; risks associated
with operations outside the United States; risks associated with
the length and severity of the ongoing novel coronavirus (COVID-19)
outbreak, including its effects on demand for dry bulk products and
the transportation thereof; and other factors listed from time to
time in the Company's filings with the SEC, its most recent annual
report on Form 20-F. The Company's filings can be obtained free of
charge on the SEC's website at www.sec.gov. Except to the extent
required by law, the Company expressly disclaims any obligations or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in the Company's expectations with respect thereto or any change in
events, conditions or circumstances on which any statement is
based.
For further information please
contact:
Capital Link, Inc. Daniela Guerrero230 Park
Avenue Suite 1536 New York, NY 10169 Tel: (212) 661-7566 E-mail:
seanergy@capitallink.com
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