(

) LONG-TERM DEBT

Our long-term debt at

December

31,

2016

and

2015

consisted of the following:

	December 31, 2016			December 31, 2015
	(In thousands)
Senior Notes Due 2022	$	429,640		$	499,000
Multicurrency Facility Agreement		49,000			-
Norwegian Facility Agreement		11,157			-
		489,797			499,000
Debt Premium		423			607
Debt Issuance Costs Associated with the Senior Notes		(6,894	)		(9,018	)
Total	$	483,326		$	490,589

The following is a summary of scheduled debt maturities by year:

Year	Debt Maturity
	(In thousands)
2017		-
2018		-
2019		60,157
2020		-
2021		-
Thereafter		429,640
Total	$	489,797

Our consolidated financial statements as of and for the year ended

December

31,

2016

have been prepared assuming we will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business for the

twelve

-month period following the date of the consolidated financial statements. However, for the reasons described in Note

indebtedness with the stated maturities as summarized above is classified as a current liability at

December

31,

2016.

enior Notes Due

2022

March

and

December

2012,

we issued

$500.0

million aggregate principal amount of

6.375%

senior notes due

2022,

or the Senior Notes. The Senior Notes pay interest semi-annually on

March

and

September

15.

Prior to

March

15,

2017,

may

redeem some or all of the Senior Notes for cash at a redemption price equal to

100%

of their principal amount plus an applicable make-whole premium and accrued and unpaid interest to the redemption date. The make-whole premium is based on the U.S. Treasury Rate plus

basis points. On and after

March

15,

2017,

may

redeem some or all of the Senior Notes at the redemption prices (expressed as percentages of principal amount) equal to

103.188%

for the

twelve

-month period beginning

March

15,

2017,

102.125%

for the

twelve

-month period beginning

March

15,

2018,

101.063%

for the

twelve

-month period beginning

March

15,

2019

and

100.000%

beginning

March

15,

2020

and thereafter, plus accrued and unpaid interest to the redemption date.

December

2015,

we repurchased in the open market

$1.0

million face value of the Senior Notes leaving

$499.0

million aggregate principal amount of the Senior Notes outstanding at

December

31,

2015.

2016,

we repurchased in the open market

$69.4

million face value of the Senior Notes and recorded gains totaling approximately

$35.9

million, which gains are included in other income and expense in our consolidated statements of operations.

In conjunction with the Senior Notes offering, we incurred a total of

$12.7

million in debt issuance costs. In prior periods, debt issuance costs were included in our consolidated balance sheet under deferred costs and other assets. Under the provisions of ASU No.

2015

03,

the unamortized balance in debt issuance costs is included in our consolidated balance sheet as a direct deduction from the face amount of the Senior Notes. This change in accounting principle was applied retrospectively; therefore, the

December

31,

2015

presentation of deferred costs and other assets and long term debt in our consolidated financial statements has been adjusted to conform to this standard. The effective interest rate on the Senior Notes, adjusted for the premium and debt issuance costs, is

6.73%.

December

31,

2016,

the fair value of the Senior Notes, based on quoted market prices, was approximately

$234.9

million compared to a carrying amount of

$429.6

million.

We have not paid the

$13.7

million interest payment due

March

15,

2017

on our Senior Notes and, as provided for in the indenture governing the Senior Notes, have entered into the

-day grace period to make such payment. Failure to pay this amount on

March

15,

2017

would constitute an event of default under the indenture governing the Senior Notes if the payment is not made within

days of such date and would result in a cross-default under the Multicurrency Facility Agreement and the Norwegian Facility Agreement.

Multicurrency Facility Agreement

We are party to a senior secured, revolving multicurrency credit facility, or the Multicurrency Facility Agreement, among GulfMark Offshore, Inc., as guarantor,

one

of our indirect wholly-owned subsidiaries, GulfMark Americas, Inc., as the Borrower, a group of financial institutions as the lenders and the Royal Bank of Scotland plc, as agent for the lenders, and the other parties thereto. The Multicurrency Facility Agreement has a scheduled maturity date of

September

26,

2019

and, as amended, commits the lenders to provide revolving loans of up to

$100.0

million at any

one

time outstanding, subject to certain terms and conditions set forth in the Multicurrency Facility Agreement, and contains a sublimit of

$25.0

million for swingline loans and a sublimit of

$5.0

million for the issuance of letters of credit. Revolving loans drawn under the Multicurrency Facility Agreement and denominated in U.S. Dollars accrue interest at the London Interbank Offered Rate, or LIBOR, plus an applicable margin which

may

range from

2.75%

4.00%,

while swingline loans drawn under the Multicurrency Facility Agreement accrue interest at the alternate base rate. The applicable margin is determined by reference to the capitalization ratio calculated as of the last day of the most recent fiscal quarter. The applicable interest rate for overdue amounts increases by an additional

2.00%.

The fee for unused commitments is

1.25%

per annum. We are subject to certain covenants and other obligations under the Multicurrency Facility Agreement, which include, among others:

●

the maintenance of a capitalization ratio not to exceed

60%

at the end of each fiscal quarter;

●

the maintenance of a minimum consolidated interest coverage ratio, for any period of

four

consecutive fiscal quarters, of

1.5

1.0

beginning on

September

30,

2017

and increasing periodically thereafter;

●

the maintenance of a minimum collateral to debt ratio of

3.0

1.0

at the end of each fiscal quarter;

●

the maintenance of a minimum collateral to commitments ratio of

2.0

1.0

at the end of each fiscal quarter;

●

the maintenance of a minimum consolidated adjusted EBITDA, at the end of each fiscal quarter, of

$20.0

million for the

twelve

-month period ended

September

30,

2016,

and for each

twelve

-month period thereafter through the fiscal quarter ending

June

30,

2017;

●

the maintenance of a minimum liquidity amount of

$35.0

million (as determined under the Multicurrency Facility Agreement) at the end of each fiscal quarter;

●

the delivery of a monthly information packet to the agent;

●

the delivery of an appraised value for each of the collateral vessels to the agent in each fiscal quarter;

●

the mandatory prepayment of any loans outstanding if, at the end of a fiscal quarter, we have cash, on a consolidated basis, in excess of

$35.0

million;

●

a prohibition against drawing loans under the Multicurrency Facility Agreement for the purpose of funding payments on our platform supply vessel, or PSV, delivered by Simek in

January

2017;

●

the limitation of the amount of cash we

may

invest for certain capital expenditures, acquisitions, joint ventures, dividends and share repurchases;

●

the limitation of acquisitions, mergers, consolidations, joint ventures, changes of business, changes of ownership, indebtedness and asset sales, subject to certain exceptions; and

●

the prohibition of liens on certain of our assets, subject to certain exceptions.

We had unamortized fees paid to the arrangers, the agent and the security trustee totaling

$2.5

million at

December

31,

2016,

which fees were amortized into interest cost on a straight-line basis over the life of the Multicurrency Facility Agreement.

The Multicurrency Facility Agreement is secured by

vessels owned by the Borrower. The collateral that secures the loans under the Multicurrency Facility Agreement

may

also secure all of the Borrower’s obligations under any hedging agreements between the Borrower and any lender or other hedge counterparty to the Multicurrency Facility Agreement.

We unconditionally guaranteed all existing and future indebtedness and liabilities of the Borrower arising under the Multicurrency Facility Agreement and other related loan documents. Such guarantee

may

also cover obligations of the Borrower arising under any hedging arrangements. At

December

31,

2016

we had

$49.0

million borrowed and outstanding under the Multicurrency Facility Agreement and we were in compliance with all the covenants under the Multicurrency Facility Agreement. The unused borrowing capacity under the Multicurrency Facility Agreement at

December

31,

2016,

after giving effect to standby letters of credit, was

$35.8

million.

The weighted average interest rate on our outstanding borrowings under the Multicurrency Facility Agreement was

4.62%.

March

2017,

we entered into an agreement with the agent under our Multicurrency Facility Agreement that prohibits us from requesting any additional loans under the Multicurrency Facility Agreement without the prior written consent of the agent (acting upon the instruction of all the lenders following unanimous consent). In this agreement, the lenders agreed to extend additional revolving loans in the aggregate principal amount of

$10.0

million subject to certain conditions precedent, including payment by us of certain fees and retainers of a financial advisor and counsel for the agent, and the lenders agreed to waive any default or event of default (no such default or event of default

having been admitted by us) arising by virtue of a borrowing request submitted previously by us, which request was deemed to be withdrawn pursuant to the agreement. The lenders funded loans in such amount on

March

2017.

In addition, we are obligated to provide the agent certain information including a revised budget, a revised forecast and weekly financial information, in each case by specified deadlines, and to keep the agent and the lenders informed of negotiations and discussions with holders of our indebtedness. The lenders agreed that between the date of the agreement through

March

14,

2017,

no lender shall, in its capacity as lender, exercise any right of set off, combination of accounts or similar remedy in relation to the cash of the obligors under the Multicurrency Facility Agreement in respect of any amounts that are outstanding or

may

become outstanding under the Multicurrency Facility Agreement.

March

14,

2017,

we entered into a support agreement, or Support Agreement, with the agent under the Multicurrency Facility Agreement in which the lenders agreed to waive the existing or anticipated defaults or events of default under the Multicurrency Facility Agreement listed in the Support Agreement and forbear from exercising rights or remedies under the related finance documents as a result therefrom, for a limited support period. The Support Agreement, and the waiver and forbearance provided for therein, terminates upon the earliest to occur of certain termination events described therein or

April

14,

2017.

Norwegian Facility Agreement

We are party to a senior secured revolving credit facility, or the Norwegian Facility Agreement, among GulfMark Offshore, Inc., as guarantor,

one

of our indirect wholly-owned subsidiaries, GulfMark Rederi AS, as the borrower, which we refer to as the Norwegian Borrower, and DNB Bank ASA, a Norwegian bank, as lead arranger and lender, which we refer to as the Norwegian Lender. The Norwegian Facility Agreement has a scheduled maturity date of

September

30,

2019

and commits the Norwegian Lender to provide loans of up to an aggregate principal amount of

600.0

million NOK (or approximately

$69.4

million at

December

31,

2016)

at any

one

time outstanding, subject to certain terms and conditions. Loans under the Norwegian Facility Agreement accrue interest at the Norwegian Interbank Offered Rate, or NIBOR, or, if the loan is denominated in U.S. Dollars, LIBOR, plus an applicable margin which

may

range from

2.50%

4.00%,

depending on the interest coverage ratio. During the continuance of an event of default, upon notice by the agent under the Norwegian Facility Agreement, the applicable interest rate increases by an additional

2.00%.

The fee for unused commitments is

1.25%

per annum. We are subject to certain covenants and other obligations under the Norwegian Facility Agreement, which include, among other things:

●

the maintenance of a capitalization ratio not to exceed

60%

at the end of each fiscal quarter;

●

the maintenance of a minimum consolidated interest coverage ratio, for any period of

four

consecutive fiscal quarters, of

1.5

1.0,

beginning at the end of our

third

fiscal quarter of

2017

and increasing periodically thereafter;

●

the maintenance of a minimum collateral to debt ratio, as defined, of

3.0

1.0

at the end of each fiscal quarter;

●

the maintenance of a minimum collateral to commitments ratio, as defined, of

2.0

1.0

at the end of each fiscal quarter;

●

the maintenance of a minimum consolidated adjusted EBITDA as of the end of each fiscal quarter of

$20.0

million for the

twelve

-month period ended

September

30,

2016,

and for each

twelve

-month period thereafter through the fiscal quarter ending

June

30,

2017;

●

the maintenance of a minimum liquidity amount of

$35.0

million at the end of each fiscal quarter;

●

the mandatory prepayment of any loans outstanding if, at the end of a fiscal quarter, we have cash, on a consolidated basis, in excess of

$35.0

million;

●

the mandatory prepayment of any loans outstanding if, at any time, the fleet market value of the vessels securing the Norwegian Facility Agreement is less than

300%

of the aggregate outstanding unpaid loans (unless we elect to provide additional security acceptable to the agent in its sole discretion);

●

the limitation of mergers, consolidations, divestitures, restructurings and changes of business, subject to certain exceptions;

●

the prohibition of liens on certain of our vessels, subject to certain exceptions; and

●

the requirement that we remain listed on the New York Stock Exchange or another recognized stock exchange.

We had unamortized fees paid to the arrangers, the agent and the security trustee totaling

$1.2

million at

December

31,

2016,

which fees are being amortized into interest cost on a straight-line basis over the life of the Norwegian Facility Agreement.

The Norwegian Facility Agreement is secured by

seven

vessels owned by our subsidiary GulfMark UK Ltd. and by

four

vessels of the Norwegian Borrower and our additional North Sea PSV which was delivered in

January

2017.

The collateral that secures the loans under the Norwegian Facility Agreement

may

also secure all of the Norwegian Borrower’s obligations under any hedging agreements between the Norwegian Borrower and the Norwegian Lender or other hedge counterparty to the Norwegian Facility Agreement.

We unconditionally guaranteed all existing and future indebtedness and liabilities of the Norwegian Borrower arising under the Norwegian Facility Agreement and other related loan documents. Such guarantee

may

also cover obligations of the Norwegian Borrower arising under any hedging arrangements described above. At

December

31,

2016,

we had

$11.2

million borrowed and outstanding under the Norwegian Facility Agreement and we were in compliance with all the covenants under the Norwegian Facility Agreement. The unused borrowing capacity under the Norwegian Facility Agreement at

December

31,

2016

was

$58.2

million.

December

31,

2016,

the weighted average interest rate on our outstanding borrowings under the Norwegian Facility Agreement was

4.38%.