Republic of the Marshall Islands | 98–0453513 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
300 First Stamford Place, 5th Floor | |
Stamford, Connecticut | 06902 |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer ☐ | Accelerated filer x | Non-Accelerated filer ☐ |
Smaller reporting company x | Emerging growth company ☐ |
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• | Focusing on the most attractive drybulk vessel segment |
• | Employing an active management strategy for fleet trading |
• | Executing on fleet renewal and growth |
• | Performing technical management in-house |
• | Implementing a prudent approach to balance sheet management |
• | Upholding strong corporate governance |
• | Enacting Corporate Social Responsibility (“CSR”) |
• | Abiding by our values |
◦ | PASSION for excellence drives us |
◦ | EMPOWERMENT of our people leads to better results |
◦ | INTEGRITY defines our culture |
◦ | RESPONSIBILITY to safety underpins every decision |
◦ | FORWARD THINKING takes us to a more successful tomorrow |
Vessel | Class | Dwt | Year Built | ||||
Bittern | Supramax | 57,809 | 2009 | ||||
Canary | Supramax | 57,809 | 2009 | ||||
Cardinal | Supramax | 55,362 | 2004 | ||||
Condor | Supramax | 50,296 | 2001 | ||||
Crane | Supramax | 57,809 | 2010 | ||||
Crested Eagle | Supramax | 55,989 | 2009 | ||||
Crowned Eagle | Supramax | 55,940 | 2008 | ||||
Egret Bulker | Supramax | 57,809 | 2010 | ||||
Fairfield Eagle | Ultramax | 63,301 | 2013 | ||||
Gannet Bulker | Supramax | 57,809 | 2010 | ||||
Golden Eagle | Supramax | 55,989 | 2010 | ||||
Goldeneye | Supramax | 52,421 | 2002 | ||||
Grebe Bulker | Supramax | 57,809 | 2010 | ||||
Greenwich Eagle | Ultramax | 63,301 | 2013 | ||||
Groton Eagle | Ultramax | 63,301 | 2013 | ||||
Hamburg Eagle | Ultramax | 63,334 | 2014 | ||||
Hawk I | Supramax | 50,296 | 2001 | ||||
Ibis Bulker | Supramax | 57,809 | 2010 | ||||
Imperial Eagle | Supramax | 55,989 | 2010 | ||||
Jaeger | Supramax | 52,483 | 2004 | ||||
Jay | Supramax | 57,809 | 2010 | ||||
Kestrel I | Supramax | 50,351 | 2004 | ||||
Kingfisher | Supramax | 57,809 | 2010 | ||||
Madison Eagle | Ultramax | 63,301 | 2013 | ||||
Martin | Supramax | 57,809 | 2010 | ||||
Merlin | Supramax | 50,296 | 2001 | ||||
Mystic Eagle | Ultramax | 63,301 | 2013 | ||||
New London Eagle | Ultramax | 63,140 | 2015 | ||||
Nighthawk | Supramax | 57,809 | 2011 | ||||
Oriole | Supramax | 57,809 | 2011 | ||||
Osprey I | Supramax | 50,206 | 2002 | ||||
Owl | Supramax | 57,809 | 2011 | ||||
Petrel Bulker | Supramax | 57,809 | 2011 | ||||
Puffin Bulker | Supramax | 57,809 | 2011 | ||||
Roadrunner Bulker | Supramax | 57,809 | 2011 | ||||
Rowayton Eagle | Ultramax | 63,301 | 2013 | ||||
Sandpiper Bulker | Supramax | 57,809 | 2011 | ||||
Shrike | Supramax | 53,343 | 2003 | ||||
Singapore Eagle | Ultramax | 63,386 | 2017 |
Skua | Supramax | 53,350 | 2003 | ||||
Southport Eagle | Ultramax | 63,301 | 2013 | ||||
Stamford Eagle | Ultramax | 61,530 | 2016 | ||||
Stellar Eagle | Supramax | 55,989 | 2009 | ||||
Stonington Eagle | Ultramax | 63,301 | 2012 | ||||
Tern | Supramax | 50,209 | 2003 | ||||
Thrasher | Supramax | 53,360 | 2010 | ||||
Westport Eagle | Ultramax | 63,344 | 2015 | ||||
1) | Time charter-out |
2) | Voyage Chartering |
3) | Vessel + Cargo Arbitrage |
4) | Time charter-in |
5) | Hedging (FFAs) |
6) | Asymmetric Optionality |
Charter Characteristics | Voyage Charter | Time Charter | Index Charter | Commercial Pool (5) | |||
Typical contract length | Single voyage | One or multiple voyages | Six months or more | Varies | |||
Hire rate basis (1) | Per MT of cargo loaded | Daily | Linked to BSI | Varies | |||
Voyage expenses (2) | We pay | Customer pays | Customer pays | Pool pays | |||
Vessel expenses for owned vessels (3) | We pay | We pay | We pay | We pay | |||
Charter hire expense for vessels chartered-in | We pay | We pay | We pay | We pay | |||
Off-hire (4) | Customer does not pay | Customer does not pay | Customer does not pay | Pool does not pay |
(1) | “Hire rate” refers to a sum of money paid to the vessel owner by a charterer under a time charter party for the use of a vessel. "Freight rate basis" means the sum of money paid to the vessel owner under a voyage charter or contract of affreightment (as defined below) based on the unit measurement of cargo loaded. “BSI” refers to “Baltic Supramax Index” and the daily hire rate varies based on the Index. The BSI is an index published by the Baltic Exchange which tracks the gross time charter spot value for Supramax. |
(2) | “Voyage expenses” include fuel, port charges, canal tolls, and brokerage commissions paid by the Company. |
(3) | “Vessel expenses” include crewing, repairs and maintenance, insurance, stores, lubes and communication expenses. |
(4) | “Off-hire” refers to the time a vessel is unavailable to perform the service either due to scheduled or unscheduled repairs. |
(5) | The Company does not presently employ vessels in a Commercial Pool. |
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||
Time Charter | 27 | 27 | 23 | |||
Voyage Charter | 18 | 18 | 17 | |||
Index Charter | — | — | — | |||
Commercial Pool | — | — | 1 | |||
Drydock | 2 | 2 | 1 | |||
Total | 47 | 47 | 42 |
• | Commercial operations, which involve chartering and operating a vessel; and |
• | Technical operations, which involve maintaining, crewing and repairing a vessel. |
• | Commercial operations and technical supervision; |
• | Vessel maintenance and repair; |
• | Vessel acquisition and sale; |
• | Legal, compliance and insurance services and |
• | Finance, accounting, treasury and information technology services. |
• | Injury to, destruction or loss of, or loss of use of, natural resources and related assessment costs; |
• | Injury to, or economic losses resulting from, the destruction of real and personal property; |
• | Net loss of taxes, royalties, rents, fees or net profit revenues resulting from injury, destruction or loss of real or personal property, or natural resources; |
• | Loss of subsistence use of natural resources that are injured, destroyed, or lost; |
• | Lost profits or impairment of earning capacity due to injury, destruction or loss of real or personal property or natural resources; and |
• | Net cost of increased of additional public services necessitated by removal activities following a discharge of oil such as protection from fire, safety or health hazards, and loss of subsistence use of natural resources. |
• | On-board installation of automatic identification systems to provide a means for the automatic transmission of safety-related information from among similarly equipped ships and shore stations, including information on a ship’s identity, position, course, speed and navigational status; |
• | On board installation of ship security alert systems, which do not sound on the vessel but only alert the authorities on shore; the development of vessel security plans; |
• | Ship identification number to be permanently marked on a vessel’s hull; |
• | A continuous synopsis record kept onboard showing a vessel’s history including the name of the ship, the state whose flag the ship is entitled to fly, the date on which the ship was registered with that state, the ship’s identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address; and |
• | Compliance with flag state security certification requirements. |
• | Annual Surveys. For seagoing ships, annual surveys are conducted for the hull and the machinery, including the electrical plant, and where applicable for special equipment classed, within three months before or after each anniversary date of the date of commencement of the class period indicated in the certificate. |
• | Intermediate Surveys. Extended annual surveys are referred to as intermediate surveys and typically are conducted two and one-half years after commissioning and each class renewal. Intermediate surveys are to be carried out at or between the second or third annual survey. |
• | Class Renewal Surveys. Class renewal surveys, also known as special surveys, are carried out for the ship’s hull, machinery, including the electrical plant and for any special equipment classed, at the intervals indicated by the character of classification for the hull. At the special survey the vessel is thoroughly examined, including audio-gauging to determine the thickness of the steel structures. Should the thickness be found to be less than class requirements, the classification society would prescribe steel renewals. The classification society may grant a one year grace period for completion of the special survey. Substantial amounts of money may have to be spent for steel renewals to pass a special survey if the vessel experiences excessive wear and tear. In lieu of the special survey approximately every five years, depending on whether a grace period was granted, a ship owner has the option of arranging with the classification society for the vessel’s hull or machinery to be on a continuous survey cycle, in which every part of the vessel would be surveyed within a five year cycle. At an owner’s application, the surveys required for class renewal may be split according to an agreed schedule to extend over the entire period of class. This process is referred to as continuous class renewal. |
• | it is organized in a qualified foreign country, which is one that grants an ''equivalent exemption'' from tax to corporations organized in the United States in respect of each category of shipping income for which exemption is being claimed under Section 883 and to which we refer as the ''Country of Organization Test''; and |
• | one of the following tests is met: |
◦ | more than 50% of the value of its shares is beneficially owned, directly or indirectly, by qualified shareholders, which as defined includes individuals who are ''residents'' of a qualified foreign country, to which we refer as the ''50% Ownership Test''; |
◦ | subject to an exception for closely-held corporations, its shares are ''primarily and regularly traded on an established securities market'' in a qualified foreign country or in the United States, to which we refer as the "Publicly-Traded Test"; or |
◦ | it is a ''controlled foreign corporation'' and satisfies an ownership test, to which, collectively, we refer to as the ''CFC Test.'' |
• | the Company has, or is considered to have, a fixed place of business in the United States involved in the earning of United States source shipping income; and |
• | substantially all of the Company's United States source shipping income is attributable to regularly scheduled transportation, such as the operation of a vessel that follows a published schedule with repeated sailings at regular intervals between the same points for voyages that begin or end in the United States. |
• | at least 75% of our gross income for such taxable year consists of passive income (e.g., dividends, interest, capital gains and rents derived other than in the active conduct of a rental business); or |
• | at least 50% of the average value of our assets during such taxable year produce, or are held for the production of, passive income |
• | the excess distribution or gain would be allocated ratably over the Non-Electing Holder's aggregate holding period for the common stock; |
• | the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which the Company was a passive foreign investment company, would be taxed as ordinary income and would not be ''qualified dividend income''; and |
• | the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year. |
• | The gain is effectively connected with the Non-United States Holder’s conduct of a trade or business in the United States (and, if the Non-United States holder is entitled to the benefits of an income tax treaty with respect to that gain, that gain is attributable to a permanent establishment maintained by the Non-United States holder in the United States); or |
• | The Non-United States Holder is an individual who is present in the United States for 183 days or more during the taxable year of disposition and other conditions are met. |
• | Fail to provide an accurate taxpayer identification number; |
• | Are notified by the IRS that you have failed to report all interest or dividends required to be shown on your federal income tax returns; or |
• | In certain circumstances, fail to comply with applicable certification requirements. |
• | Employing our fleet at charter hire rates below our breakeven levels which could negatively impact our ability to operate and generate a profit. Operating at below breakeven levels for a prolonged period of time may leave us with insufficient cash resources to meet certain obligations, including the payment of interest and principal on our debt, causing us to potentially breach financial covenants under our existing credit facilities and bond terms. |
• | Our charterers may fail to meet their obligations under existing time charter or voyage charter agreements. |
• | The market value of our fleet could decrease, causing us to potentially recognize losses if vessels are sold or if their values impaired. Additionally, a decline in the value of our fleet could cause us to breach certain covenants under our existing credit facilities and bond terms. |
• | supply of and demand for energy resources, commodities, and industrial products; |
• | changes in the exploration or production of energy resources, commodities, consumer and industrial products; |
• | the location of regional and global exploration, production, and manufacturing facilities; |
• | the location of consuming regions for energy resources, commodities, semi-finished and finished consumer and industrial products; |
• | the globalization of production and manufacturing; |
• | global and regional economic and political conditions, including trade agreements among nations, armed conflicts and terrorist activities; embargoes and strikes; |
• | developments in international trade; |
• | changes in seaborne and other transportation patterns, including the distance cargo is transported by sea; |
• | environmental and other regulatory developments; |
• | currency exchange rates; and |
• | weather. |
• | the number of newbuilding deliveries; |
• | port and canal congestion; |
• | the scrapping of older vessels; |
• | vessel casualties; |
• | weather; |
• | price of fuel; |
• | slow steaming; |
• | statutory and regulatory changes requiring the purchase and installation of new equipment to continue to trade; and |
• | the number of vessels that are out of service, namely those that are laid-up, drydocked awaiting repairs or otherwise not available for hire. |
• | prevailing level of charter rates; |
• | general economic and market conditions affecting the shipping industry; |
• | types, sizes, and ages of vessels; |
• | supply of and demand for vessels; |
• | other modes of transportation; |
• | cost of new buildings; |
• | governmental or other regulations; |
• | the need to upgrade secondhand and previously owned vessels as a result of charterer requirements, technological advances in vessel design or equipment or otherwise; and |
• | technological advances. |
• | marine disaster; |
• | environmental accidents; |
• | cargo and property losses or damage; |
• | business interruptions caused by mechanical failure, human error, war, terrorism, political action in various countries, labor strikes or adverse weather conditions; and |
• | piracy. |
• | locating and acquiring suitable vessels; |
• | obtaining required financing on acceptable terms; |
• | identifying and consummating acquisitions or joint ventures; |
• | enhancing our customer base; and |
• | managing our expansion. |
• | actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry; |
• | announcements by us or our competitors of significant contracts, acquisitions or capital commitments; |
• | mergers and strategic alliances in the shipping industry; |
• | terrorist acts; |
• | future sales of our common shares or other securities; |
• | market conditions in the shipping industry; |
• | economic and regulatory trends; |
• | shortfalls in our operating results from levels forecast by securities analysts; |
• | announcements concerning us or our competitors; |
• | the general state of the securities market; and |
• | investors’ perception of us and the drybulk shipping industry. |
Plan Category | Securities to be issued upon exercise of outstanding options, warrants and rights (1) | Weighted-average exercise price of outstanding options, warrants and rights | Remaining securities for future issuance under equity compensation plans (1) | |||||||
Equity compensation plans approved by security holders | 2,005,421 | $ | 4.85 | 1,471,709 | ||||||
Equity compensation plans not approved by security holders | — | — | N/A | |||||||
Total | 2,005,421 | 4.85 | 1,471,709 |
Successor | Predecessor | |||||||||||||||||||||||
Income Statement Data (a) | 2018 | 2017 | 2016 | 2015 | Period from October 16, 2014 to December 31, 2014 (a) | Period from January 1, 2014 to October 15, 2014 (a) | ||||||||||||||||||
Revenues, net | $ | 310,094 | $ | 236,785 | $ | 124,493 | $ | 103,857 | $ | 31,090 | $ | 123,150 | ||||||||||||
Voyage expenses | 79,566 | 62,351 | 42,094 | 23,832 | 6,262 | 14,704 | ||||||||||||||||||
Vessel expenses | 81,336 | 78,607 | 74,017 | 86,329 | 17,331 | 71,679 | ||||||||||||||||||
Charter hire expenses | 38,046 | 31,284 | 12,845 | 4,126 | 1,043 | 188 | ||||||||||||||||||
Depreciation and Amortization | 37,717 | 33,691 | 38,884 | 43,001 | 8,782 | 61,239 | ||||||||||||||||||
General and Administrative Expenses | 36,157 | 33,126 | 22,906 | 25,537 | 5,933 | 18,679 | ||||||||||||||||||
Restructuring Charges | — | — | 5,869 | — | — | — | ||||||||||||||||||
Vessel Impairment* | — | — | 129,028 | 50,873 | — | — | ||||||||||||||||||
(Gain)/loss on Sale of Vessels | (335 | ) | (2,135 | ) | 102 | 5,697 | — | — | ||||||||||||||||
Total Operating Expenses | 272,487 | 236,925 | 325,745 | 239,395 | 39,351 | 166,489 | ||||||||||||||||||
Interest expense | 25,744 | 29,377 | 21,799 | 11,927 | 2,360 | 60,737 | ||||||||||||||||||
Interest income | (585 | ) | (651 | ) | (215 | ) | (6 | ) | (2 | ) | (8 | ) | ||||||||||||
Other (income)/expense | (126 | ) | (38 | ) | 687 | 838 | 884 | — | ||||||||||||||||
Reorganization expense | — | — | — | — | 46 | 427,735 | ||||||||||||||||||
Loss on debt extinguishment ** | — | 14,969 | — | — | — | — | ||||||||||||||||||
Net income/(loss) | $ | 12,575 | $ | 43,797 | $ | (223,523 | ) | $ | (148,297 | ) | $ | (11,549 | ) | $ | (531,803 | ) | ||||||||
Share and Per Share Data | ||||||||||||||||||||||||
Basic income/(loss) per share | $ | 0.18 | $ | (0.63 | ) | $ | (10.87 | ) | $ | (78.88 | ) | $ | (6.16 | ) | $ | (29.78 | ) | |||||||
Diluted income/(loss) per share | $ | 0.18 | $ | (0.63 | ) | $ | (10.87 | ) | $ | (78.88 | ) | $ | (6.16 | ) | $ | (29.78 | ) | |||||||
Weighted Average Shares Outstanding – Diluted | 71,802 | 69,182 | 20,566 | 1,881 | 1,875 | 17,857 | ||||||||||||||||||
Consolidated Cash Flow Data | ||||||||||||||||||||||||
Net cash provided by/(used in) operating activities | $ | 45,470 | $ | (10,037 | ) | $ | (45,434 | ) | $ | (43,787 | ) | $ | (279 | ) | $ | (19,465 | ) | |||||||
Net cash (used in) / provided by investing activities | (31,014 | ) | (155,250 | ) | (9,347 | ) | 10,252 | 4,206 | (491 | ) | ||||||||||||||
Net cash provided by /(used in) financing activities | 7,381 | 145,022 | 106,335 | 18,456 | — | (36,322 | ) |
Consolidated Balance Sheet Data | December 31, 2018 | December 31, 2017 | December 31, 2016 | December 31, 2015 | December 31, 2014 (a) | |||||||||||||||
Current Assets | $ | 118,474 | $ | 105,223 | $ | 104,265 | $ | 41,025 | $ | 76,591 | ||||||||||
Total Assets | 846,209 | 808,350 | 686,382 | 786,603 | 913,877 | |||||||||||||||
Total Liabilities | 366,603 | 347,185 | 285,899 | 268,259 | 249,786 | |||||||||||||||
Current Portion of Long-term Debt (b) | 29,176 | 4,000 | — | 15,625 | 15,625 | |||||||||||||||
Long-term Debt | 301,583 | 313,684 | 255,944 | 225,577 | 203,556 | |||||||||||||||
Stockholders' Equity (c) | 479,606 | 461,165 | 400,483 | 518,344 | 664,091 | |||||||||||||||
Other Data | ||||||||||||||||||||
Capital Expenditures: | ||||||||||||||||||||
Vessels and vessel improvements | $ | 43,444 | $ | 176,603 | $ | 21,787 | $ | 1,747 | $ | 486 | ||||||||||
Cash paid for scrubbers, ballast water systems and other | $ | 12,342 | $ | — | $ | — | $ | — | $ | — | ||||||||||
Drydocking costs incurred | $ | 8,323 | $ | 2,579 | $ | 3,689 | $ | 11,142 | $ | 5,764 | ||||||||||
Ratio of Total Debt to Total Capitalization (d) | 40.8 | % | 40.8 | % | 39.0 | % | 31.8 | % | 24.8 | % | ||||||||||
Fleet Data | ||||||||||||||||||||
Number of Vessels in owned fleet | 47 | 47 | 41 | 44 | 45 | |||||||||||||||
Average Age of Fleet | 9.0 | 8.2 | 8.7 | 8.4 | 8.0 | |||||||||||||||
Fleet Ownership Days | 17,213 | 16,293 | 15,408 | 16,186 | 16,425 | |||||||||||||||
Charter-in under operating lease Days | 3,294 | 3,353 | 1,494 | 382 | 91 | |||||||||||||||
Fleet Available Days | 20,083 | 19,245 | 16,695 | 16,151 | 16,325 | |||||||||||||||
Fleet Operating Days | 19,921 | 19,140 | 16,485 | 15,766 | 15,988 | |||||||||||||||
Fleet Utilization | 99.2 | % | 99.5 | % | 98.8 | % | 97.6 | % | 97.9 | % |
(a) | The consolidated and other financial data for the year ended December 31, 2014 presents the results of operations for the period from October 16, 2014 to December 31, 2014 (Successor) and the period from January 1, 2014 to October 15, 2014 (Predecessor). The period from October 16, 2014 to December 31, 2014 (Successor) and the period from January 1, 2014 to October 15, 2014 (Predecessor) are distinct reporting periods because of our emergence from bankruptcy on October 15, 2014. As result of the bankruptcy, our capital structure, our financial statements and share and per share amounts are not comparable between the Successor and Predecessor. |
(b) | The amount of $29.2 million is based on our existing debt as of December 31, 2018 - Norwegian Bond Debt, Original Ultraco Debt Facility and New First Lien Facility. The Original Ultraco Debt Facility and New First Lien Facility were refinanced on January 25, 2019 with the New Ultraco Debt Facility. |
(c) | Effective August 5, 2016, the Company completed a 1 for 20 reverse stock split of its issued and outstanding shares of common stock, par value $0.01 per share (the “Reverse Stock Split”), pursuant to which proportional adjustments were made to the Company’s issued and outstanding common stock and to its common stock underlying stock options and other common stock-based equity grants outstanding immediately prior to the effectiveness of the Reverse Stock Split as well as the applicable exercise price. In addition, proportional adjustments were made to the number of shares of common stock issuable upon exercise of outstanding warrants and to the exercise price of such warrants, pursuant to the terms thereof. No fractional shares were issued in connection with the Reverse Stock Split, and shareholders who would have received a fractional share of common stock in connection with the Reverse Stock Split instead received a cash payment in lieu of such fractional share. The Company also had 3,040,540 outstanding warrants convertible to 152,027 shares of the Company's common stock which will be recorded as equity upon exercise at an exercise price of $556.40 per share. The warrants have a 7 year term and will expire on October 15, 2021. |
(d) | Ratio of Total Debt to Total Capitalization was calculated as debt divided by capitalization (debt plus stockholders' equity). |
• | On April 17, 2018, the Company sold the vessel Avocet for $9.7 million, after brokerage commissions and associated selling expenses, and recorded a net gain of approximately $0.1 million in its Consolidated Statements of Operations for the year ended December 31, 2018. |
• | During 2018, the Company, through its subsidiary Ultraco, purchased two Ultramax vessels, New London Eagle and Hamburg Eagle for $21.3 million per vessel. |
• | On August 14, 2018, the Company entered into a contract for installation of BWTS on our owned vessels.The projected costs, including installation, is approximately $0.5 million per BWTS. The Company intends to complete the installation during scheduled drydockings in the next three years. The Company recorded $1.0 million in Other assets in the Consolidated Balance Sheet as of December 31, 2018. |
• | On September 4, 2018, the Company announced it had entered into a series of agreements to purchase up to 37 exhaust gas cleaning systems ("Scrubbers") which are to be retrofitted on owned vessels. The Agreements are comprised of firm orders for 19 Scrubbers and up to an additional 18 units, at the Company’s option. On November 20, 2018, the Company announced that it had exercised its option to purchase 15 of the 18 optional Scrubbers, and on January 23, 2019, the Company announced that it had exercised the remaining 3 options. The projected costs, including installation, is approximately $2.2 million per Scrubber. The Company recorded $16.9 million in Other assets in its Consolidated Balance Sheet as of December 31, 2018. The Company intends to complete the retrofit of a majority of vessels prior to the January 1, 2020, which is the implementation date of the new sulphur emission cap as set forth by the IMO. |
• | On September 10, 2018, the Company sold the vessel Thrush for $10.8 million after brokerage commissions and associated selling expenses. The Company recorded a gain of $0.2 million in its Consolidated Statements of Operations for the year ended December 31, 2018. |
• | On December 13, 2018, the Company signed a memorandum of agreement to sell the vessel Condor for $6.5 million after brokerage commissions and associated selling expenses. The vessel was delivered to the buyers in January 2019. The Company expects to record a gain of approximately $2.2 million in the first quarter of 2019. The Company recorded the carrying amount of the vessel as vessels held for sale as of December 31, 2018. |
• | On December 21, 2018, the Company signed a memorandum of agreement to purchase a 2015 built Ultramax vessel for $20.4 million. As of December 31, 2018, the Company paid a deposit of $2.0 million. The Company took delivery of the vessel, Cape Town Eagle in January 2019. |
• | On January 4, 2019, the Company signed a memorandum of agreement to sell the vessel Merlin for $6.1 million after brokerage commissions and associated selling expenses. The vessel was delivered to the buyers in January 2019. The Company expects to record a gain of approximately $1.9 million in the first quarter of 2019. The Company recorded the carrying amount of the vessel as vessels held for sale as of December 31, 2018. |
• | On April 26, 2016, the Company sold the vessel Peregrine for $2.6 million, after brokerage commissions and associated selling expenses, and recorded a net loss of approximately $0.1 million in the second quarter of 2016. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On June 16, 2016, the Company sold the vessel Falcon for $3.2 million, after brokerage commissions and associated selling expenses, and recorded a net loss of approximately $0.1 million in the second quarter of 2016. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On July 12, 2016, the Company sold the vessel Harrier for $3.2 million, after brokerage commissions, associated selling expenses, and recorded a loss of $0.1 million. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On September 6, 2016, the Company sold the vessel Kittiwake for $4.0 million, after brokerage commission, associated selling expenses, and recorded a net gain of $0.3 million in the third quarter of 2016. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On September 30, 2016, Eagle Bulk Shipco LLC ("Shipco") signed a memorandum of agreement to acquire a 2016 NACKS built Ultramax 61,000 dwt. vessel for $18.8 million. The Company took the delivery of the vessel, the Stamford Eagle, in the fourth quarter of 2016. |
• | On November 14, 2016, the Company, through its subsidiary Shipco, signed a memorandum of agreement to acquire a 2017 built 64,000 dwt SDARI-64 Ultramax drybulk vessel constructed at Chengxi Shipyard Co., Ltd for $17.9 million. The Company took delivery of the vessel, the Singapore Eagle, on January 11, 2017. |
• | On January 6, 2017, the Company sold the vessel Redwing for $5.8 million, after brokerage commissions and associated selling expenses, and recorded a net gain of $0.1 million. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On April 6, 2017, the Company sold the vessel Sparrow for $4.8 million after brokerage commissions and associated selling expenses, and recorded a net gain of $1.8 million. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On July 27, 2017, the Company sold the vessel Woodstar for $7.8 million after brokerage commissions and associated selling expenses and recorded a gain for $0.2 million. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | On November 28, 2017, the Company sold the vessel Wren for $7.6 million after brokerage commissions and associated selling expenses and recorded a gain of $0.03 million. A portion of the proceeds was used towards repayment of the term loan under the First Lien Facility. |
• | Maintain a highly efficient and quality fleet in the drybulk segment. |
• | Maintain a revenue strategy that takes advantage of a rising rate environment and at the same time mitigate risk in a declining rate environment. |
• | Maintain a cost structure that allow us to be competitive in all economic cycles without sacrificing safety and maintenance. |
• | Continue to grow our relationships with our charterers and vendors |
• | Continue to invest in our on-shore operations and development of processes. |
(1) | concentration in one vessel category: Supramax/Ultramax drybulk vessels, which we believe offer certain size, operational and geographical advantages relative to other classes of drybulk vessels, such as Handysize, Panamax and Capesize vessels, |
(2) | An active owner-operator model where we seek to operate our own fleet and develop contractual relationships directly with cargo interests. These relationships and the related cargo contracts have the dual benefit of providing greater operational efficiencies and act as a balance to the Company’s naturally long position to the market. Notwithstanding the focus on voyage chartering, we consistently monitor the drybulk shipping market and, based on market conditions, will consider taking advantage of long-term time charters at higher rates when appropriate. |
(3) | Maintain high quality vessels and improve standards of operation through improved standards and procedures, crew training and repair and maintenance procedures. |
Vessel | Year Built | Dwt | Charter Expiration | Daily Charter Hire Rate | ||||||||||
Bittern | 2009 | 57,809 | Jan 2019 | $ | 3,000 | |||||||||
Canary | 2009 | 57,809 | Feb 2019 | Voyage | ||||||||||
Cardinal | 2004 | 55,362 | Jan 2019 | $ | 7,000 | |||||||||
Condor | 2001 | 50,296 | — | $ | — | (1) | ||||||||
Crane | 2010 | 57,809 | — | $ | — | (2 | ) | |||||||
Crested Eagle | 2009 | 55,989 | Jan 2019 | $ | 25,000 | |||||||||
Crowned Eagle | 2008 | 55,940 | Jan 2019 | Voyage | ||||||||||
Egret Bulker | 2010 | 57,809 | Jan 2019 | $ | 12,000 | |||||||||
Fairfield Eagle | 2013 | 63,301 | Jan 2019 | $ | 12,000 | |||||||||
Gannet Bulker | 2010 | 57,809 | Jan 2019 | $ | 4,500 | (3) | ||||||||
Golden Eagle | 2010 | 55,989 | Feb 2019 | Voyage | ||||||||||
Goldeneye | 2002 | 52,421 | Feb 2019 | Voyage | ||||||||||
Grebe Bulker | 2010 | 57,809 | Jan 2019 | $ | 8,300 | |||||||||
Greenwich Eagle | 2013 | 63,301 | Jan 2019 | Voyage | ||||||||||
Groton Eagle | 2013 | 63,301 | Jun 2019 | $ | 10,250 | (4) | ||||||||
Hamburg Eagle | 2014 | 63,334 | Feb 2019 | $ | 2,707 | (7) | ||||||||
Hawk I | 2001 | 50,296 | Feb 2019 | $ | 14,650 | |||||||||
Ibis Bulker | 2010 | 57,809 | Feb 2019 | $ | 15,000 | |||||||||
Imperial Eagle | 2010 | 55,989 | Jan 2019 | $ | 21,500 | |||||||||
Jaeger | 2004 | 52,483 | Jan 2019 | Voyage | ||||||||||
Jay | 2010 | 57,809 | Jan 2019 | $ | 13,000 | |||||||||
Kestrel I | 2004 | 50,351 | Feb 2019 | $ | 10,250 | |||||||||
Kingfisher | 2010 | 57,809 | Jan 2019 | $ | 2,864 | (5) | ||||||||
Madison Eagle | 2013 | 63,301 | Feb 2019 | Voyage | ||||||||||
Martin | 2010 | 57,809 | Feb 2019 | Voyage | ||||||||||
Merlin | 2001 | 50,296 | Jan 2019 | $ | 12,000 | (1) | ||||||||
Mystic Eagle | 2013 | 63,301 | Feb 2019 | $ | 13,000 | |||||||||
New London Eagle | 2015 | 63,140 | Jan 2019 | $ | 20,350 | |||||||||
Nighthawk | 2011 | 57,809 | Jan 2019 | Voyage |
Oriole | 2011 | 57,809 | Jan 2019 | $ | 6,000 | (6 | ) | |||||||
Osprey I | 2002 | 50,206 | Jan 2019 | Voyage | ||||||||||
Owl | 2011 | 57,809 | Jan 2019 | $ | 12,950 | |||||||||
Petrel Bulker | 2011 | 57,809 | Jan 2019 | $ | 2,750 | |||||||||
Puffin Bulker | 2011 | 57,809 | Jan 2019 | $ | 16,000 | |||||||||
Roadrunner Bulker | 2011 | 57,809 | Jan 2019 | Voyage | ||||||||||
Rowayton Eagle | 2013 | 63,301 | Feb 2019 | Voyage | ||||||||||
Sandpiper Bulker | 2011 | 57,809 | Jan 2019 | $ | 5,600 | |||||||||
Shrike | 2003 | 53,343 | Jan 2019 | Voyage | ||||||||||
Singapore Eagle | 2017 | 63,386 | Feb 2019 | Voyage | ||||||||||
Skua | 2003 | 53,350 | Jan 2019 | Voyage | ||||||||||
Southport Eagle | 2013 | 63,301 | Jan 2019 | $ | 13,000 | |||||||||
Stamford Eagle | 2016 | 61,530 | Jan 2019 | Voyage | ||||||||||
Stellar Eagle | 2009 | 55,989 | Mar 2019 | $ | 22,000 | |||||||||
Stonington Eagle | 2012 | 63,301 | Oct 2019 | $ | 11,650 | |||||||||
Tern | 2003 | 50,209 | Nov 2019 | $ | 12,000 | |||||||||
Thrasher | 2010 | 53,360 | Feb 2019 | Voyage | ||||||||||
Westport Eagle | 2015 | 63,344 | Jan 2019 | Voyage | ||||||||||
(1) | The Company signed memorandum of agreements to sell vessels, Condor and Merlin for $6.5 million and $6.1 million, respectively, after brokerage commissions and associated selling expenses. The vessels were delivered to the buyers in January 2019. |
(2) | The vessel is undergoing repairs at a shipyard until end of February 2019. |
(3) | The vessel is contracted to continue the existing time charter at an increased charter rate of $12,000 after January 22, 2019. |
(4) | The vessel is contracted to continue the existing time charter at an increased charter rate of $14,000 after February 1, 2019. |
(5) | The vessel is contracted to continue the existing time charter at an increased charter rate of $12,800 after January 11, 2019. |
(6) | The vessel is contracted to continue the existing time charter at an increased charter rate of $12,000 after January 5, 2019. |
(7) | The vessel is contracted to continue the existing time charter at an increased charter rate of $13,500 after January 4, 2019. |
Vessel Class | Average estimated daily time charter rate used | Percentage decline from average estimated daily time charter rate used in impairment test at which point impairment would be recorded | |||||||
Supramax | $ | 12,199 | (30 | )% |
Incremental number of vessels | Potential Incremental Impairment (in millions) | ||||||
1 year historical average | — | — | |||||
3 year historical average | 3 | $ | 14.7 | ||||
5 year historical average | 3 | $ | 14.7 | ||||
10 year historical average | — | — | |||||
15 year historical average | — | — |
Dwt | Year Purchased | Carrying Value* as of December 31, 2018 | Carrying Value* as of December 31, 2017 | |||||
Drybulk Vessels | ||||||||
Bittern | 57,809 | 2009 | $16.3 million * | $17.2 million * | ||||
Canary | 57,809 | 2009 | $16.4 million * | $17.2 million * | ||||
Cardinal | 55,362 | 2005 | $6.7 million | $7.1 million | ||||
Crane | 57,809 | 2010 | $17.4 million * | $18.2 million * | ||||
Crested Eagle | 55,989 | 2009 | $19.4 million * | $20.5 million * | ||||
Crowned Eagle | 55,940 | 2008 | $18.2 million * | $19.2 million * | ||||
Egret Bulker | 57,809 | 2010 | $17.5 million * | $18.3 million * | ||||
Fairfield Eagle | 63,301 | 2017 | $16.5 million | $17.1 million | ||||
Gannett Bulker | 57,809 | 2010 | $17.4 million * | $18.1 million * | ||||
Golden Eagle | 55,989 | 2010 | $20.6 million * | $21.8 million * | ||||
Goldeneye | 52,421 | 2008 | $5.0 million | $5.3 million | ||||
Grebe Bulker | 57,809 | 2010 | $17.2 million * | $18.1 million * | ||||
Greenwich Eagle | 63,301 | 2017 | $16.3 million | $16.9 million | ||||
Groton Eagle | 63,301 | 2017 | $16.4 million | $16.9 million | ||||
Hamburg Eagle | 63,334 | 2014 | $21.2 million | — | ||||
Hawk I | 50,296 | 2005 | $4.2 million | $4.4 million | ||||
Ibis Bulker | 57,809 | 2010 | $17.2 million * | $18.1 million * | ||||
Imperial Eagle | 55,989 | 2010 | $20.7 million * | $21.8 million * | ||||
Jaeger | 52,483 | 2006 | $6.0 million | $6.3 million | ||||
Jay | 57,809 | 2010 | $17.3 million * | $18.1 million * | ||||
Kestrel I | 50,351 | 2006 | $6.1 million | $6.7 million | ||||
Kingfisher | 57,809 | 2010 | $17.3 million * | $18.1 million * | ||||
Madison Eagle | 63,301 | 2017 | $16.6 million | $17.2 million | ||||
Martin | 57,809 | 2010 | $17.3 million * | $18.1 million * | ||||
Mystic Eagle | 63,301 | 2017 | $16.4 million | $17.0 million | ||||
New London Eagle | 63,140 | 2018 | $20.9 million | — | ||||
Nighthawk | 57,809 | 2012 | $18.2 million * | $19.0 million * | ||||
Oriole | 57,809 | 2012 | $18.2 million * | $19.1 million * | ||||
Osprey I | 50,206 | 2005 | $4.9 million | $5.3 million | ||||
Owl | 57,809 | 2012 | $18.2 million * | $19.1 million * | ||||
Petrel Bulker | 57,809 | 2012 | $18.2 million * | $19.1 million * | ||||
Puffin Bulker | 57,809 | 2012 | $18.3 million * | $19.1 million * | ||||
Roadrunner Bulker | 57,809 | 2012 | $18.2 million * | $19.1 million * | ||||
Rowayton Eagle | 63,301 | 2017 | $16.4 million | $17.0 million | ||||
Sandpiper Bulker | 57,809 | 2012 | $18.3 million * | $19.1 million * | ||||
Shrike | 53,343 | 2007 | $6.1 million | $6.5 million | ||||
Singapore Eagle | 63,386 | 2017 | $17.8 million | $18.5 million | ||||
Skua | 53,350 | 2007 | $6.1 million | $6.5 million | ||||
Southport Eagle | 63,301 | 2017 | $16.3 million | $16.9 million | ||||
Stamford Eagle | 61,530 | 2016 | $17.6 million | $18.3 million | ||||
Stellar Eagle | 55,989 | 2009 | $19.5 million * | $20.6 million * | ||||
Stonington Eagle | 63,301 | 2017 | $16.3 million | $16.9 million | ||||
Tern | 50,209 | 2006 | $5.7 million | $6.0 million | ||||
Thrasher | 53,360 | 2010 | $8.9 million | $9.2 million | ||||
Westport Eagle | 63,344 | 2017 | $16.4 million | $17.0 million |
For the Years Ended | |||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | |||||||
Ownership Days | 17,213 | 16,293 | 15,408 | ||||||
Chartered-in Days | 3,294 | 3,353 | 1,494 | ||||||
Available Days | 20,083 | 19,245 | 16,695 | ||||||
Operating Days | 19,921 | 19,140 | 16,485 | ||||||
Fleet Utilization | 99.2 | % | 99.5 | % | 98.7 | % |
• | 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 record during a period. |
• | Chartered-in Days: We define chartered-in days as the aggregate number of days in a period during which the Company chartered-in vessels. |
• | 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. We drydocked 11 vessels in 2018, three vessels in 2017 and nine vessels in 2016. |
• | Operating days: We define operating days as the number of our 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 very high utilization rates. |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Revenues, net | $ | 310,094,258 | $ | 236,784,625 | $ | 124,492,844 | ||||||
Voyage Expenses | 79,566,452 | 62,351,252 | 42,093,714 | |||||||||
Charter hire expenses | 38,045,778 | 31,283,956 | 12,845,468 | |||||||||
Net charter hire income | $ | 192,482,028 | $ | 143,149,417 | $ | 69,553,662 | ||||||
% of Net charter hire from | ||||||||||||
Time charter | 64 | % | 60 | % | 64 | % | ||||||
Voyage charter | 36 | % | 39 | % | 35 | % | ||||||
Commercial pool | — | % | 1 | % | 1 | % |
• | the duration of our charters; |
• | our decisions relating to vessel acquisitions and disposals; |
• | the amount of time that we spend positioning our vessels; |
• | the amount of time that our vessels spend in drydock undergoing repairs; |
• | maintenance and upgrade work; |
• | the age, condition and specifications of our vessels; |
• | levels of supply and demand in the drybulk shipping industry; and |
• | other factors affecting spot market charter rates for drybulk carriers. |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
First Lien Facility / Exit Financing Facility Interest * | $ | — | $ | 10,305,275 | $ | 9,938,822 | ||||||
Amortization of debt discount and debt issuance costs | 1,913,651 | 5,927,984 | 4,532,481 | |||||||||
Payment-in-Kind interest on Second Lien Facility | — | 10,098,401 | 7,327,843 | |||||||||
Original Ultraco Debt Facility Interest | 3,774,309 | 1,269,581 | — | |||||||||
Norwegian Bond Debt interest | 16,424,449 | 1,558,333 | — | |||||||||
New First Lien Facility | 3,509,790 | 209,420 | — | |||||||||
Super Senior Revolving Credit Facility - commitment fees | 121,332 | 8,000 | — | |||||||||
Total Interest Expense | $ | 25,743,531 | $ | 29,376,994 | $ | 21,799,146 |
For the Years Ended | ||||||||||||||
Derivatives not designated as hedging instruments | Location of (gain)/loss recognized | December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
FFAs | Other (income)/expense | $ | (471,679 | ) | $ | 375,672 | $ | 561,495 | ||||||
Bunker Swaps | Other (income)/expense | 345,438 | (413,577 | ) | — | |||||||||
Total | $ | (126,241 | ) | $ | (37,905 | ) | $ | 561,495 |
Derivatives not designated as hedging instruments | Balance Sheet location | For the Years Ended | |||||||
December 31, 2018 | December 31, 2017 | ||||||||
FFAs - Unrealized loss | Fair value of Derivatives | $ | — | $ | 73,170 | ||||
Bunker Swaps - Unrealized loss | Fair value of Derivatives | 929,313 | — | ||||||
FFAs - Unrealized gain | Other current assets | 669,240 | — | ||||||
Bunker Swaps - Unrealized gain | Other current assets | — | 128,845 |
For the Years Ended | ||||||||||||
(in thousands of U.S. dollars) | December 31, 2018 | December 31, 2017 | December 31, 2016 | |||||||||
Net cash provided by/(used in) operating activities | $ | 45,470 | $ | (10,037 | ) | $ | (45,434 | ) | ||||
Net cash used in investing activities | (31,014 | ) | (155,250 | ) | (9,347 | ) | ||||||
Net cash provided by financing activities | 7,381 | 145,022 | 106,335 | |||||||||
Increase/(Decrease) in cash and cash equivalents | 21,838 | (20,265 | ) | 51,554 | ||||||||
Cash, cash equivalents including restricted cash, beginning of year | 56,326 | 76,591 | 25,037 | |||||||||
Cash and cash equivalents including restricted cash, end of year | $ | 78,164 | $ | 56,326 | $ | 76,591 |
Contractual Obligation | Payment Due by Period | ||||||||||||||||||||
(in thousands of dollars) | 2019 | 2020-2021 | 2022-2023 | 2024 + | Total | ||||||||||||||||
Bank Loans(1) | $ | 21,176 | $ | 33,882 | $ | 87,542 | $ | — | $ | 142,600 | |||||||||||
Interest and borrowing fees(1) | 24,828 | 44,757 | 19,673 | — | 89,258 | ||||||||||||||||
Norwegian Bond Debt (1) | 8,000 | 16,000 | 172,000 | — | 196,000 | ||||||||||||||||
Chartering agreement (2,3) | 13,965 | 17,462 | — | — | 31,427 | ||||||||||||||||
Office lease | 715 | 1,436 | 728 | — | 2,879 | ||||||||||||||||
Vessel acquisition (4) | 18,360 | — | — | — | 18,360 | ||||||||||||||||
Vessel Improvements (5) | 65,905 | 14,547 | — | — | 80,452 | ||||||||||||||||
Total | $ | 152,949 | $ | 128,084 | $ | 279,943 | $ | — | — | $ | 560,976 |
(1) | This table does not take into account obligations incurred under the New Ultraco Debt Facility and the refinancing of the Original Ultraco Debt Facility and the New First Lien Facility that occurred on January 25, 2019. See Note 8. Debt to our consolidated financial statements. Interest is based on LIBOR assumption of 3.21%. |
(2) | Does not include obligations of chartered-in vessels less than one year. |
(3) | Includes charter hire obligations on three chartered-in vessels with daily charter rates ranging between $12,800 to $15,250. Please see Note 10. Commitments and Contingencies to the consolidated financial statements. |
(4) | On December 21, 2018, the Company signed a memorandum of agreement to purchase a 2015 built Ultramax vessel for $20.4 million. As of December 31, 2018, the Company paid a deposit of $2.0 million. The Company took delivery of the vessel in the first quarter of 2019. |
(5) | This amount includes the Company's projected costs related to the ballast water treatment systems ("BWTS") and 34 Scrubbers. BWTS includes costs for 2 vessels sold in January 2019 and excludes the cost for the three scrubber options declared in January 2019 which amounted to $6.6 million. |
Projected Costs(2) (in millions) | |||||||||
Quarter Ending | Off-hire Days(1) | BWTS | Scrubbers | Drydocks | |||||
March 31, 2019 | 87 | $ | 0.9 | 22.2 | 1.6 | ||||
June 30, 2019 | 167 | $ | 2.5 | 15.4 | 1.8 | ||||
September 30, 2019 | 192 | $ | 3.6 | 15.3 | 3.1 | ||||
December 31, 2019 | 246 | $ | 2.8 | 13.7 | 5.1 |
(1) Actual duration of off-hire days will vary based on the age and 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. |
Incremental interest expense | ||||||||
For the year ended December 31, 2018 | For the year ended December 31, 2017 | |||||||
+200 basis points | $ | 2,852,000 | $ | 2,524,000 | ||||
+100 basis points | 1,426,000 | 1,262,000 | ||||||
-100 basis points | (1,426,000 | ) | (1,262,000 | ) |
Number of Securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans(excluding securities reflected in column (a)) | ||||||||
Plan Category | (a)* | (b) | (c)* | |||||||
Equity compensation plans approved by security holders | 2,005,421 | $ | 4.85 | 1,471,709 | ||||||
Equity compensation plans not approved by security holders | — | — | N/A | |||||||
Total | 2,005,421 | 4.85 | 1,471,709 |
1. | Consolidated Financial Statements: See accompanying Index to Consolidated Financial Statements. |
2. | Consolidated Financial Statement Schedule: Financial statement schedules are omitted either due to the absence of conditions under which they are required or because the information required is included in the notes to the Company’s consolidated financial statements. |
Number | Exhibit Title |
3.1 | |
3.2 | |
4.1 | |
4.2 | |
4.3 | |
10.2 | |
10.3 | |
10.4 | |
10.7# | |
10.8# | |
10.9# | |
10.10 | |
10.11 |
10.12 | |
10.13 | |
10.14 | |
10.15 | |
10.16 | |
10.17 | |
10.18 | |
10.19 | |
10.20 | |
10.21 | |
10.22 | |
10.24 | |
10.25 | |
10.28# | |
10.29# | |
10.30# | |
10.31# |
10.32 | |
10.33# | |
10.34# | |
10.35# | |
10.36# | |
10.37# | |
10.38 | |
10.39 | |
10.40 | |
10.41 | |
10.42 | |
10.43 | |
10.44* |
10.45 | |
10.46* | |
21.1* | |
23.1* | |
23.2* | |
31.1* | |
31.2* | |
32.1** | |
32.2** | |
101.INS* | XBRL Instance Document. |
101.CAL* | XBRL Schema Document. |
101.SCH* | XBRL Calculation Linkbase Document. |
101.DEF* | XBRL Definition Linkbase Document. |
101.LAB* | XBRL Labels Linkbase Document. |
101.PRE* | XBRL Presentation Linkbase Document. |
EAGLE BULK SHIPPING INC. | ||||
By: | /s/ Gary Vogel | |||
Name: | Gary Vogel | |||
Title: | Chief Executive Officer |
Name | Title | |
/s/ Gary Vogel | Chief Executive Officer and Director (Principal Executive Officer) | |
Gary Vogel | ||
/s/ Frank De Costanzo | Chief Financial Officer (Principal Financial and Accounting Officer) | |
Frank De Costanzo | ||
/s/ Paul M. Leand, Jr. | Chairman of the Board of Directors | |
Paul M. Leand, Jr. | ||
/s/ Randee E. Day | Director | |
Randee E. Day | ||
/s/ Justin A. Knowles | Director | |
Justin A. Knowles | ||
/s/ Bart Veldhuizen | Director | |
Bart Veldhuizen | ||
/s/ Gary Weston | Director | |
Gary Weston |
December 31, 2018 | December 31, 2017 | |||||||
ASSETS: | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 67,209,753 | $ | 56,251,044 | ||||
Accounts receivable, net of a reserve of $2,073,616 and $3,501,964, respectively | 19,785,582 | 17,246,540 | ||||||
Prepaid expenses | 4,635,879 | 3,010,766 | ||||||
Short-term investment | — | 4,500,000 | ||||||
Inventories | 16,137,785 | 14,113,079 | ||||||
Vessels held for sale | 8,458,444 | 9,316,095 | ||||||
Other current assets | 2,246,740 | 785,027 | ||||||
Total current assets | 118,474,183 | 105,222,551 | ||||||
Noncurrent assets: | ||||||||
Vessels and vessel improvements, at cost, net of accumulated depreciation of $124,907,998 and $99,910,416, respectively | 682,944,936 | 690,236,419 | ||||||
Advance for vessel purchase | 2,040,000 | 2,201,773 | ||||||
Other fixed assets, net of accumulated depreciation of $547,452 and $343,799, respectively | 692,803 | 617,343 | ||||||
Restricted cash | 10,953,885 | 74,917 | ||||||
Deferred financing costs - Super Senior Facility | 285,342 | 190,000 | ||||||
Deferred drydock costs, net | 12,186,356 | 9,749,751 | ||||||
Other assets | 18,631,655 | 57,181 | ||||||
Total noncurrent assets | 727,734,977 | 703,127,384 | ||||||
Total assets | $ | 846,209,160 | $ | 808,349,935 | ||||
LIABILITIES & STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 14,161,169 | $ | 7,470,844 | ||||
Accrued interest | 1,735,631 | 1,790,315 | ||||||
Other accrued liabilities | 10,064,017 | 11,810,366 | ||||||
Fair value of derivatives | 929,313 | 73,170 | ||||||
Unearned charter hire revenue | 6,926,839 | 5,678,673 | ||||||
Current portion of long-term debt | 29,176,230 | 4,000,000 | ||||||
Total current liabilities | 62,993,199 | 30,823,368 | ||||||
Noncurrent liabilities: | ||||||||
Norwegian Bond Debt, net of debt discount and debt issuance costs | 182,469,155 | 189,950,329 | ||||||
New First Lien Facility, net of debt discount and debt issuance costs | 48,189,307 | 63,758,185 | ||||||
Original Ultraco Debt Facility, net of debt discount and debt issuance costs | 70,924,885 | 59,975,162 | ||||||
Other liabilities | 208,651 | 177,846 | ||||||
Fair value below contract value of time charters acquired | 1,818,114 | 2,500,012 | ||||||
Total noncurrent liabilities | 303,610,112 | 316,361,534 | ||||||
Total liabilities | 366,603,311 | 347,184,902 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity: | ||||||||
Preferred stock, $.01 par value, 25,000,000 shares authorized, none issued as of December 31, 2018 and 2017 | — | — | ||||||
Common stock, $.01 par value, 700,000,000 shares authorized, 71,055,400 and 70,394,307 shares issued and outstanding as of December 31, 2018 and 2017, respectively | 710,555 | 703,944 | ||||||
Additional paid-in capital | 894,272,533 | 887,625,902 | ||||||
Accumulated deficit | (415,377,239 | ) | (427,164,813 | ) | ||||
Total stockholders' equity | 479,605,849 | 461,165,033 | ||||||
Total liabilities and stockholders' equity | $ | 846,209,160 | $ | 808,349,935 |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Revenues, net | $ | 310,094,258 | $ | 236,784,625 | $ | 124,492,844 | ||||||
Voyage expenses | 79,566,452 | 62,351,252 | 42,093,714 | |||||||||
Vessel expenses | 81,336,260 | 78,607,244 | 74,016,763 | |||||||||
Charter hire expenses | 38,045,778 | 31,283,956 | 12,845,468 | |||||||||
Depreciation and amortization | 37,717,462 | 33,690,686 | 38,884,322 | |||||||||
General and administrative expenses | 36,156,660 | 33,126,310 | 22,905,802 | |||||||||
Restructuring charges | — | — | 5,869,025 | |||||||||
(Gain)/loss on sale of vessels | (335,160 | ) | (2,134,767 | ) | 101,860 | |||||||
Vessel impairment | — | — | 129,027,862 | |||||||||
Total operating expenses | 272,487,452 | 236,924,681 | 325,744,816 | |||||||||
Operating income/(loss) | 37,606,806 | (140,056 | ) | (201,251,972 | ) | |||||||
Interest expense | 25,743,531 | 29,376,994 | 21,799,146 | |||||||||
Interest income | (585,168 | ) | (651,069 | ) | (215,433 | ) | ||||||
Other (income)/expense | (126,241 | ) | (37,905 | ) | 686,750 | |||||||
Loss on debt extinguishment | — | 14,968,609 | — | |||||||||
Total other expense, net | 25,032,122 | 43,656,629 | 22,270,463 | |||||||||
Net income/(loss) | $ | 12,574,684 | $ | (43,796,685 | ) | $ | (223,522,435 | ) | ||||
Weighted average shares outstanding: | ||||||||||||
Basic | 70,665,212 | 69,182,302 | 20,565,652 | |||||||||
Diluted | 71,802,173 | 69,182,302 | 20,565,652 | |||||||||
Per share amounts: | ||||||||||||
Basic net income/(loss) | $ | 0.18 | $ | (0.63 | ) | $ | (10.87 | ) | ||||
Diluted net income/(loss) | $ | 0.18 | $ | (0.63 | ) | $ | (10.87 | ) |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Net income/(loss) | $ | 12,574,684 | $ | (43,796,685 | ) | $ | (223,522,435 | ) | ||||
Total other comprehensive income/(loss) | — | — | — | |||||||||
Comprehensive income/(loss) | $ | 12,574,684 | $ | (43,796,685 | ) | $ | (223,522,435 | ) |
Common Stock | Common Stock Amount | Additional paid-in Capital | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||
Balance at January 1, 2016 | 1,883,303 | $ | 18,833 | $ | 678,171,322 | $ | (159,845,693 | ) | $ | 518,344,462 | |||||||||
Net loss | — | — | — | (223,522,435 | ) | (223,522,435 | ) | ||||||||||||
Issuance of shares in connection with Second Lien Loan Agreement | 16,889,828 | 168,899 | 17,587,426 | — | 17,756,325 | ||||||||||||||
Issuance of shares for private placement, net of issuance costs | 29,333,318 | 293,333 | 85,407,202 | — | 85,700,535 | ||||||||||||||
Reverse stock split adjustment * | (32 | ) | — | — | — | — | |||||||||||||
Issuance of shares due to vesting of restricted shares | 410 | 4 | (4 | ) | — | — | |||||||||||||
Cash used to settle net share equity awards | — | — | (2,938 | ) | — | (2,938 | ) | ||||||||||||
Stock-based compensation | — | — | 2,206,690 | — | 2,206,690 | ||||||||||||||
Balance at December 31, 2016 | 48,106,827 | 481,069 | 783,369,698 | (383,368,128 | ) | 400,482,639 | |||||||||||||
Net loss | — | — | — | (43,796,685 | ) | (43,796,685 | ) | ||||||||||||
Issuance of shares for private placement, net of issuance costs | 22,222,223 | 222,222 | 95,807,781 | — | 96,030,003 | ||||||||||||||
Issuance of shares due to vesting of restricted shares | 65,257 | 653 | (653 | ) | — | — | |||||||||||||
Cash used to settle net share equity awards | — | — | (289,539 | ) | — | (289,539 | ) | ||||||||||||
Stock-based compensation | — | — | 8,738,615 | — | 8,738,615 | ||||||||||||||
Balance at December 31, 2017 | 70,394,307 | 703,944 | 887,625,902 | (427,164,813 | ) | 461,165,033 | |||||||||||||
Net income | — | — | — | 12,574,684 | 12,574,684 | ||||||||||||||
Cumulative effect of accounting change ** | — | — | — | (787,110 | ) | (787,110 | ) | ||||||||||||
Issuance of shares due to vesting of restricted shares and exercise of options, net of cash received | 661,093 | 6,611 | (1,745 | ) | — | 4,866 | |||||||||||||
Cash used to settle net share equity awards | — | — | (2,559,104 | ) | — | (2,559,104 | ) | ||||||||||||
Stock-based compensation | — | — | 9,207,480 | — | 9,207,480 | ||||||||||||||
Balance at December 31, 2018 | 71,055,400 | $ | 710,555 | $ | 894,272,533 | $ | (415,377,239 | ) | $ | 479,605,849 |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net income/(loss) | $ | 12,574,684 | $ | (43,796,685 | ) | $ | (223,522,435 | ) | ||||
Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities: | ||||||||||||
Depreciation | 32,364,359 | 29,354,017 | 35,556,911 | |||||||||
Amortization of deferred drydocking costs | 5,353,102 | 4,336,669 | 3,327,411 | |||||||||
Amortization of debt discount and debt issuance costs | 1,913,651 | 5,927,984 | 4,532,481 | |||||||||
Loss on debt extinguishment | — | 14,968,609 | — | |||||||||
Amortization of fair value below contract value of time charter acquired | (681,898 | ) | (716,783 | ) | (661,253 | ) | ||||||
Payment-in-kind interest on Second Lien Facility | — | 10,098,401 | 7,327,843 | |||||||||
Cash paid towards Payment-in-kind interest on Second Lien Facility | — | (17,426,244 | ) | — | ||||||||
(Gain)/loss on sale of vessels, net | (335,160 | ) | (2,134,767 | ) | 101,860 | |||||||
Vessel impairment | — | — | 129,027,862 | |||||||||
Net unrealized loss/(gain) on fair value of derivatives | 315,748 | (55,675 | ) | — | ||||||||
Fees paid on termination of time charter contract | — | (1,500,000 | ) | — | ||||||||
Stock-based compensation expense | 9,207,480 | 8,738,615 | 2,206,690 | |||||||||
Drydocking expenditures | (8,323,191 | ) | (2,579,111 | ) | (3,688,711 | ) | ||||||
Changes in operating assets and liabilities: | ||||||||||||
Accounts receivable | (3,465,025 | ) | (12,156,832 | ) | 1,986,820 | |||||||
Other current and non-current assets | (207,234 | ) | (331,707 | ) | (26,799 | ) | ||||||
Prepaid expenses | (1,625,113 | ) | 83,196 | 138,801 | ||||||||
Inventories | (2,024,706 | ) | (3,236,366 | ) | (5,302,307 | ) | ||||||
Accounts payable | 993,557 | 335,688 | (1,081,317 | ) | ||||||||
Accrued interest | (54,684 | ) | 1,761,443 | (372,360 | ) | |||||||
Other accrued and non-current liabilities | (1,125,638 | ) | (1,340,366 | ) | 528,563 | |||||||
Unearned revenue | 590,531 | (367,359 | ) | 4,485,630 | ||||||||
Net cash provided by/(used in) operating activities | 45,470,463 | (10,037,273 | ) | (45,434,310 | ) | |||||||
Cash flows from investing activities: | ||||||||||||
Purchase of vessels and vessel improvements | (41,404,328 | ) | (174,400,746 | ) | (19,860,401 | ) | ||||||
Advance for vessel purchase | (2,040,000 | ) | (2,201,773 | ) | (1,926,886 | ) | ||||||
Cash paid for scrubbers, ballast water treatment systems and other assets | (12,342,317 | ) | — | — | ||||||||
Proceeds/(purchase) of short-term investment | 4,500,000 | (4,500,000 | ) | — | ||||||||
Proceeds from sale of vessels | 20,545,202 | 26,042,000 | 13,001,000 | |||||||||
Purchase of other fixed assets | (272,067 | ) | (189,120 | ) | (560,348 | ) | ||||||
Net cash used in investing activities | (31,013,510 | ) | (155,249,639 | ) | (9,346,635 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Repayment of First Lien Facility | — | (184,099,000 | ) | (21,276,000 | ) | |||||||
Repayment of revolver under the First Lien Facility | — | (25,000,000 | ) | (30,158,500 | ) | |||||||
Repayment of Second Lien Facility | — | (60,000,000 | ) | — | ||||||||
Proceeds from Revolver Loan facility | — | — | 15,158,500 | |||||||||
Proceeds from Second Lien Facility | — | — | 60,000,000 | |||||||||
Proceeds from common stock placement, net of issuance costs | — | 96,030,003 | 85,700,535 | |||||||||
Proceeds from the Norwegian Bond Debt, net of discount | — | 198,092,000 | — | |||||||||
Repayment of outstanding bonds under Norwegian Bond Debt | (4,000,000 | ) | — | |||||||||
Proceeds from the New First Lien Facility | — | 65,000,000 | ||||||||||
Repayment of revolver under New First Lien Facility | (5,000,000 | ) | — | — | ||||||||
Proceeds from the Original Ultraco Debt Facility | 21,400,000 | 61,200,000 | — | |||||||||
Financing costs paid to lenders | — | (2,025,514 | ) | — | ||||||||
Other financing costs | (2,465,037 | ) | (3,886,104 | ) | (3,086,947 | ) | ||||||
Cash received from exercise of stock options | 4,865 | — | — | |||||||||
Cash used to settle net share equity awards | (2,559,104 | ) | (289,539 | ) | (2,938 | ) | ||||||
Net cash provided by financing activities | 7,380,724 | 145,021,846 | 106,334,650 | |||||||||
Net increase/(decrease) in cash, cash equivalents and restricted cash | 21,837,677 | (20,265,066 | ) | 51,553,705 |
Cash, cash equivalents and restricted cash at beginning of year | 56,325,961 | 76,591,027 | 25,037,322 | |||||||||
Cash, cash equivalents and restricted cash at end of year | $ | 78,163,638 | $ | 56,325,961 | $ | 76,591,027 | ||||||
Supplemental cash flow information: | ||||||||||||
Non-cash accruals for Scrubbers and ballast water systems included in Accounts payable and Other accrued liabilities | $ | 5,801,867 | $ | — | $ | — | ||||||
Cash paid during the period for interest excluding payment of accumulated payment-in-kind interest on the Second Lien Facility paid on December 8, 2017 of $17.7 million. | $ | 23,884,565 | $ | 11,589,192 | $ | 10,257,766 |
(a) | Principles of Consolidation: The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles and include the accounts of Eagle Bulk Shipping Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions were eliminated upon consolidation. |
(b) | Use of Estimates: The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include vessel valuations, residual value of vessels, the useful lives of vessels, the value of stock-based compensation and the fair value of derivatives. Actual results could differ from those estimates. |
(c) | Other Comprehensive income/(loss): The Company records the fair value of interest rate swaps and foreign currency swaps designated as hedges as an asset or liability on the balance sheet. The effective portion of the swap is recorded in accumulated other comprehensive loss. Historically, the Company also recorded the unrealized gains and losses on its available for sale investments in accumulated other comprehensive loss. The Company did not have any swaps or available for sale investments as of December 31, 2018 and 2017. |
(d) | Cash, Cash Equivalents and Restricted Cash: The Company considers liquid investments such as time deposits and certificates of deposit with an original maturity of three months or less at the time of purchase to be cash equivalents. Restricted Cash as of December 31, 2018 was $11.0 million related to the proceeds from the sale of vessel Thrush, which were restricted pursuant to the terms under the Norwegian Bond Debt. Please see Note 8 Debt to the consolidated financial statements for additional information. Additionally, the Company also had restricted cash and cash equivalents of $74,917 for collateralizing a letter of credit as of December 31, 2018 and December 31, 2017, respectively. |
(e) | Accounts Receivable: Accounts receivable includes receivables from charterers for time and voyage charterers. At each balance sheet date, all potentially uncollectible accounts are assessed for purposes of determining the appropriate provision for doubtful accounts. The Company wrote off $1.4 million and $3.4 million for the years ended December 31, 2018 and 2017, respectively, related to previously reserved amounts in the allowance for doubtful accounts. The Company did not record any material provisions for doubtful accounts for the years ended December 31, 2018 and 2017. |
(f) | Insurance Claims: Insurance claims are recorded as incurred and represent the claimable expenses, net of deductibles, incurred through each balance sheet date, which are expected to be recovered from insurance companies. |
(g) | Inventories: Inventories, which consist of bunkers, are stated at cost which is determined on a first-in, first-out method. Lubes and spares are expensed as incurred. |
(h) | Short-term Investments: The Company considers liquid investments such as certificate of deposits with an original maturity of greater than three months as investments. As of December 31, 2017, the Company had $4.5 million in a certificate of deposit with an original maturity of one year. The certificate of deposit matured in the first quarter of 2018 and is included in cash and cash equivalents as of December 31, 2018. |
(i) | Vessels and vessel improvements, at cost: Vessels are stated at cost, which consists of the contract price, and other direct costs relating to acquiring and placing the vessels in service. Major vessel improvements are capitalized and depreciated over the remaining useful lives of the vessels. Depreciation is calculated on a straight-line basis over the estimated useful lives of the vessels based on the cost of the vessels reduced by the estimated scrap value of the vessels as discussed below. |
(j) | Vessel lives and Impairment of Long-Lived Assets: The Company estimates the useful life of the Company's vessels to be from the date of initial delivery from the shipyard to the original owner. The useful lives of the Company's vessels are evaluated to determine if events have occurred which would require modification to their useful lives. In addition, the Company estimates the scrap value of the vessels to be $300 per light weight ton ("lwt"). |
(k) | Accounting for Drydocking Costs: The Company follows the deferral method of accounting for drydocking costs whereby actual costs incurred are deferred and are amortized on a straight-line basis over the period through the date the next drydocking is required to become due, generally 30 months if the vessels are 15 years old or more and 60 months for the vessels younger than 15 years. Costs deferred as part of the drydocking include direct costs that are incurred as part of the drydocking to meet regulatory requirements. Certain costs are capitalized during drydocking if they are expenditures that add economic life to the vessel, increase the vessel’s earnings capacity or improve the vessel’s efficiency. Direct costs that are deferred include the shipyard costs, parts, inspection fees, steel, blasting and painting. Expenditures for normal maintenance and repairs, whether incurred as part of the drydocking or not, are expensed as incurred. Unamortized drydocking costs of vessels that are sold are written off and included in the calculation of the resulting gain or loss in the year of the vessels’ sale. Unamortized drydocking costs are written off as drydocking expense if the vessels are drydocked before the expiration of the applicable amortization period. |
(l) | Deferred Financing Costs: Fees incurred for obtaining new loans or refinancing existing ones are deferred and amortized to interest expense over the life of the related debt using the effective interest method. Unamortized deferred financing costs are written off when the related debt is repaid or refinanced and such amounts are expensed in the period the repayment or refinancing is made. Such amounts are classified as a reduction of the long-term debt balance on the consolidated balance sheets. For our Super Senior Revolver Facility, as no amounts have been drawn, deferred financing fees of $0.3 million and $0.2 million have been classified as a non-current asset on the Consolidated Balance Sheets as of December 31, 2018 and 2017, respectively. |
(m) | Other fixed assets: Other fixed assets are stated at cost less accumulated depreciation. Depreciation is based on a straight-line basis over the estimated useful life of the asset. Other fixed assets consist principally of leasehold improvements, computers and software and are depreciated over three years. |
(n) | Accounting for Revenues and Expenses: Revenues generated from time charters and/or revenues generated from profit sharing arrangements are recognized on a straight-line basis over the term of the respective time charter agreements as service is provided and the profit sharing is fixed and determinable. |
(o) | Unearned Charter Hire Revenue: Unearned charter hire revenue represents cash received from charterers prior to the time such amounts are earned. These amounts are recognized as revenue as services are provided in future periods. |
(p) | Repairs and Maintenance: All repair and maintenance expenses are expensed as incurred and are recorded in Vessel Expenses. |
(q) | Protection and Indemnity Insurance: The Company’s Protection and Indemnity Insurance is subject to additional premiums referred to as "back calls" or "supplemental calls" which are accounted for on an accrual basis and are recorded in Vessel Expenses. |
(r) | Earnings Per Share: Basic earnings per share is computed by dividing the net income or loss by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the impact of stock options, warrants and restricted stock under the treasury stock method unless their impact is anti-dilutive. |
(s) | Interest Rate Risk Management: The Company is exposed to the impact of interest rate changes for outstanding debt under the New First Lien Facility and the Original Ultraco Debt Facility. The Company's objective is to manage the impact of interest rate changes on earnings and cash flows of its borrowings. The Company may use interest rate swaps to manage net exposure to interest rate changes related to its borrowings. |
(t) | Federal Taxes: The Company is a Republic of the Marshall Islands Corporation. For the years ended December 31, 2018 and 2017, the Company believes that its operations qualify for Internal Revenue Code Section 883 exemption and therefore are not subject to United States federal taxes on United States source shipping income. The Company recorded $0.6 million in such taxes as component of voyage expenses for the year ended December 31, 2016 which were reversed in the second quarter of 2017 upon the determination that the Company qualified for the Internal Revenue Code Section 883 exemption for 2016. |
(u) | Restructuring charges: Restructuring charges consist of professional fees for advisors and attorneys who assisted the Company in the debt restructuring relative to the First Lien Facility in 2016. |
(v) | Stock-based compensation: The Company issues stock-based compensation utilizing both stock options and stock grants. Stock-based compensation is measured at the fair value of the award at the date of grant and recognized over the period of vesting on a straight-line basis using the graded vesting method. The grant-date fair value of stock options is estimated using the Black-Scholes option pricing model. Forfeitures are recognized as they occur. |
For the year ended December 31, 2018 | |||
Time charters | $ | 140,006,570 | |
Voyage charters | 170,087,688 | ||
$ | 310,094,258 |
As of December 31, 2018 | |||||||||||
As Reported | Balance without adoption of ASC 606 | Effect of change | |||||||||
Assets | |||||||||||
Accounts receivable | $ | 19,785,582 | $ | 20,771,299 | $ | (985,717 | ) | ||||
Other current assets | 2,246,740 | 1,478,450 | 768,290 | ||||||||
Liabilities | |||||||||||
Unearned charter hire revenue | 6,926,839 | 6,528,275 | 398,564 |
For the year ended December 31, 2018 | |||||||||||
As Reported | Balance without adoption of ASC 606 | Effect of change | |||||||||
Revenues, net | $ | 310,094,258 | $ | 309,894,921 | $ | 199,337 | |||||
Voyage expenses | 79,566,452 | 79,292,962 | 273,490 | ||||||||
Charter hire expenses | 38,045,778 | 37,957,027 | 88,751 | ||||||||
Net income | 12,574,684 | 12,737,588 | (162,904 | ) | |||||||
Basic income per share | $ | 0.18 | $ | 0.18 | $ | — | |||||
Diluted income per share | $ | 0.18 | $ | 0.18 | $ | — |
December 31, 2017 | Effect of adoption of ASC 606 | January 1, 2018 | |||||||||
Assets | |||||||||||
Accounts receivable | $ | 17,246,540 | $ | (925,983 | ) | $ | 16,320,557 | ||||
Other current assets (1) | 785,027 | 796,508 | 1,581,535 | ||||||||
Liabilities | |||||||||||
Unearned charter hire revenue (2) | 5,678,673 | 657,635 | 6,336,308 | ||||||||
Stockholders' equity | |||||||||||
Accumulated deficit | (427,164,813 | ) | (787,110 | ) | (427,951,923 | ) |
2018 | 2017 | ||||||
Vessel and vessel improvements at the beginning of the year | $ | 690,236,419 | $ | 567,592,950 | |||
Advance paid for vessel purchase | 2,201,773 | 1,926,886 | |||||
Purchase of Vessels and vessel improvements | 41,487,795 | 174,400,746 | |||||
Disposal of Vessels | (10,354,855 | ) | (15,218,633 | ) | |||
Reclassification to vessels held for sale | (8,458,444 | ) | (9,316,095 | ) | |||
Depreciation Expense | (32,167,752 | ) | (29,149,435 | ) | |||
Vessels and Vessel Improvements | $ | 682,944,936 | $ | 690,236,419 |
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Beginning Balance | $ | 9,749,751 | $ | 11,507,309 | $ | 11,146,009 | ||||||
Drydocking costs | 8,323,191 | 2,579,111 | 3,688,711 | |||||||||
Drydock amortization | (5,353,102 | ) | (4,336,669 | ) | (3,327,411 | ) | ||||||
Write-off due to sale of vessels * | (533,484 | ) | — | — | ||||||||
Ending Balance | $ | 12,186,356 | $ | 9,749,751 | $ | 11,507,309 |
December 31, 2018 | December 31, 2017 | |||||||
Vessel and voyage expenses | $ | 4,981,596 | $ | 5,373,389 | ||||
General and administrative expenses | 4,768,244 | 6,050,078 | ||||||
Other expenses | 314,177 | 386,899 | ||||||
Balance | $ | 10,064,017 | $ | 11,810,366 |
December 31, 2018 | December 31, 2017 | |||||||
Norwegian Bond Debt | $ | 196,000,000 | $ | 200,000,000 | ||||
Debt discount and debt issuance costs - Norwegian Bond Debt | (5,530,845 | ) | (6,049,671 | ) | ||||
Less: Current Portion - Norwegian Bond Debt | (8,000,000 | ) | (4,000,000 | ) | ||||
Norwegian Bond Debt, net of debt discount and debt issuance costs | 182,469,155 | 189,950,329 | ||||||
New First Lien Facility * | 60,000,000 | 65,000,000 | ||||||
Debt discount and debt issuance costs - New First Lien Facility | (1,060,693 | ) | (1,241,815 | ) | ||||
Less: Current Portion - New First Lien Facility | (10,750,000 | ) | — | |||||
New First Lien Facility, net of debt discount and debt issuance costs | 48,189,307 | 63,758,185 | ||||||
Original Ultraco Debt Facility | 82,600,000 | 61,200,000 | ||||||
Debt discount and debt issuance costs - Original Ultraco Debt Facility | (1,248,885 | ) | (1,224,838 | ) | ||||
Less: Current Portion - Original Ultraco Debt Facility | (10,426,230 | ) | — | |||||
Original Ultraco Debt Facility, net of debt discount and debt issuance costs | 70,924,885 | 59,975,162 | ||||||
Total long-term debt | $ | 301,583,347 | $ | 313,683,676 |
Period | Redemption Price | ||
First Call Date to, but not including, the Interest Payment Date in November 2020 | 104.125 | % | |
Interest Payment Date in November 2020 to but not including, the Interest Payment Date in May 2021 | 103.3 | % | |
Interest Payment Date in May 2021 to, but not including, the Interest Payment Date in November 2021 | 102.475 | % | |
Interest Payment Date in November 2021 to, but not including, the Interest Payment Date in May 2022 | 101.65 | % | |
Interest Payment Date in May 2022 to, but not including, the Maturity Date | 100 | % |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
First Lien Facility / Exit Financing Facility interest * | $ | — | $ | 10,305,275 | $ | 9,938,822 | ||||||
Amortization of debt discount and debt issuance costs | 1,913,651 | 5,927,984 | 4,532,481 | |||||||||
Payment in kind interest on Second Lien Facility | — | 10,098,401 | 7,327,843 | |||||||||
Original Ultraco Debt Facility interest | 3,774,309 | 1,269,581 | — | |||||||||
Norwegian Bond Debt interest | 16,424,449 | 1,558,333 | — | |||||||||
New First Lien Facility interest | 3,509,790 | 209,420 | — | |||||||||
Commitment fees - Super Senior Revolver Facility | 121,332 | 8,000 | — | |||||||||
Total Interest Expense | $ | 25,743,531 | $ | 29,376,994 | $ | 21,799,146 |
Norwegian Bond Debt | New First Lien Facility * | Original Ultraco Debt Facility * | Total | |||||||||||||
2019 | $ | 8,000,000 | $ | 10,750,000 | $ | 10,426,230 | $ | 29,176,230 | ||||||||
2020 | 8,000,000 | 8,600,000 | 8,340,984 | 24,940,984 | ||||||||||||
2021 | 8,000,000 | 8,600,000 | 8,340,984 | 24,940,984 | ||||||||||||
2022 | 172,000,000 | 32,050,000 | 55,491,802 | 259,541,802 | ||||||||||||
$ | 196,000,000 | $ | 60,000,000 | $ | 82,600,000 | $ | 338,600,000 |
For the Years Ended | ||||||||||||||
Derivatives not designated as hedging instruments | Location of (gain)/loss recognized | December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
FFAs | Other (income)/expense | $ | (471,679 | ) | $ | 375,672 | $ | 561,495 | ||||||
Bunker swaps | Other (income)/expense | 345,438 | (413,577 | ) | — | |||||||||
Total | $ | (126,241 | ) | $ | (37,905 | ) | $ | 561,495 |
Derivatives not designated as hedging instruments | Balance Sheet Location | Fair value of derivatives | ||||||||
December 31, 2018 | December 31, 2017 | |||||||||
FFAs - Unrealized loss | Fair value of derivatives | $ | — | $ | 73,170 | |||||
FFAs - Unrealized gain | Other current assets | 669,240 | — | |||||||
Bunker Swaps - Unrealized loss | Fair value of derivatives | 929,313 | — | |||||||
Bunker Swaps - Unrealized gain | Other current assets | — | 128,845 |
Fair Value | |||||||||||
Carrying Value | Level 1 | Level 2 | |||||||||
December 31, 2018 | |||||||||||
Assets | |||||||||||
Cash and cash equivalents (1) | $ | 78,163,638 | $ | 78,163,638 | $ | — | |||||
Liabilities | |||||||||||
Norwegian Bond Debt * | $ | 190,469,155 | $ | — | $ | 195,040,000 | |||||
New First Lien Facility ** | $ | 58,939,307 | $ | — | $ | 60,000,000 | |||||
Original Ultraco Debt Facility ** | $ | 81,351,115 | $ | — | $ | 82,600,000 |
Fair Value | |||||||||||
Carrying Value | Level 1 | Level 2 | |||||||||
December 31, 2017 | |||||||||||
Assets | |||||||||||
Cash and cash equivalents (1) | $ | 56,325,961 | $ | 56,325,961 | $ | — | |||||
Short-term investment | $ | 4,500,000 | $ | — | $ | 4,500,000 | |||||
Liabilities | |||||||||||
Norwegian Bond Debt * | $ | 189,950,329 | $ | — | $ | 200,990,000 | |||||
New First Lien Facility ** | $ | 63,758,185 | $ | — | $ | 65,000,000 | |||||
Original Ultraco Debt Facility ** | $ | 59,975,162 | $ | — | $ | 61,200,000 |
* | The fair value of the bonds is based on the last trade on December 21, 2018 and December 21, 2017 on Bloomberg.com. |
** | The fair value of the New First Lien Facility and the Original Ultraco Debt Facility is based on the required repayment to the lenders if the debt was discharged in full on December 31, 2018 and 2017. The New First Lien Facility and Original Ultraco Debt Facility were fully discharged as part of the refinancing transaction on January 25, 2019. Please see Note 8. Debt to the consolidated financial statements. |
2019 | $ | 715 | |
2020 | 728 | ||
2021 | 708 | ||
2022 | 483 | ||
2023 | 245 | ||
Thereafter | — | ||
Total | $ | 2,879 |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Net income/(loss) | $ | 12,574,684 | $ | (43,796,685 | ) | $ | (223,522,435 | ) | ||||
Weighted Average Shares-Basic | 70,665,212 | 69,182,302 | 20,565,652 | |||||||||
Dilutive effect of stock options, warrants and restricted stock units | 1,136,961 | — | — | |||||||||
Weighted Average Shares - Diluted | 71,802,173 | 69,182,302 | 20,565,652 | |||||||||
Basic income/(loss) per share | $ | 0.18 | $ | (0.63 | ) | $ | (10.87 | ) | ||||
Diluted income/(loss) per share | $ | 0.18 | $ | (0.63 | ) | $ | (10.87 | ) |
Restricted shares * | Fair value on grant date | Aggregate fair value (in millions) | Vesting Terms | ||||||||||
Granted on November 7, 2016 | 233,863 | $ | 4.24 | $ | 1.0 | 100% vesting on third anniversary date | |||||||
Unvested restricted stock outstanding as of December 31, 2018 and 2017 | 233,863 | $ | 4.24 | $ | 1.0 |
Options** | Weighted Average Exercise Price | Expiration( years) | Risk free interest rate | Volatility | Dividend % | Fair Value of Options on grant date | Aggregate fair value (in millions) | Expected Term and vesting conditions | ||||||||||||||||||||
Granted on November 7, 2016 | 280,000 | $ | 4.28 | 5 | 1.10 | % | 61 | % | — | % | $ | 1.91 | $ | 0.53 | 3.75 years and 25% vesting annually over four year term | |||||||||||||
Vested during 2017 | (70,000 | ) | $ | (0.13 | ) | |||||||||||||||||||||||
Unvested options outstanding as of December 31, 2017 | 210,000 | $ | 4.28 | $ | 1.91 | $ | 0.40 | |||||||||||||||||||||
Vested during 2018 | (70,000 | ) | $ | (0.13 | ) | |||||||||||||||||||||||
Unvested options outstanding as of December 31, 2018 | 140,000 | $ | 4.28 | $ | 1.91 | $ | 0.27 |
Restricted shares | Weighted Average Fair value on grant date | Aggregate fair value (in millions) | Vesting Terms | ||||||||||
Granted on December 15, 2016 * | 760,056 | $ | 5.90 | $ | 4.40 | 100% on September 1, 2018 | |||||||
Granted on December 15, 2016 * | 233,869 | 5.90 | 1.38 | 100% on October 14, 2018 | |||||||||
Unvested restricted stock outstanding as of December 31, 2016 | 993,925 | 5.90 | 5.78 | ||||||||||
Issued on March 1, 2017 | 429,750 | 5.47 | 2.35 | 33% vesting annually over three year term | |||||||||
Issued on June 1, 2017 | 18,000 | 4.64 | 0.08 | 100% vesting on third anniversary date | |||||||||
Forfeited during 2017 | (10,750 | ) | 5.47 | $ | (0.06 | ) | |||||||
Unvested restricted stock outstanding as of December 31, 2017 | 1,430,925 | 5.70 | 8.15 | ||||||||||
Issued on January 4, 2018 | 948,500 | 4.71 | 4.47 | 33% vesting annually over three year term | |||||||||
Issued on January 10, 2018 | 30,000 | 4.81 | 0.10 | ||||||||||
Vested on January 10, 2018 | (30,000 | ) | 4.81 | (0.10 | ) | ||||||||
Net shares vested on March 1, 2018 | (90,711 | ) | 5.47 | (0.50 | ) | ||||||||
Vested on September 1, 2018 | (408,143 | ) | 5.90 | (2.41 | ) | ||||||||
Vested on October 14, 2018 | (130,164 | ) | 5.90 | (0.77 | ) | ||||||||
Forfeitures and cancellations due to settlement of tax liability on vested shares during 2018 | (537,942 | ) | 5.81 | (3.13 | ) | ||||||||
Unvested restricted stock outstanding as of December 31, 2018 | 1,212,465 | $ | 4.79 | $ | 5.81 |
Options* | Weighted AverageExercise Price | Expiration (years) | Risk free interest rate | Volatility | Dividend % | Fair Value of Options on grant date | Aggregate fair value (in millions) | Expected Term and Vesting conditions | ||||||||||||||||||||
Granted on December 15, 2016 ** | 1,266,476 | $ | 4.28 | 5 | 1.79 | % | 62 | % | — | % | $ | 3.12 | $ | 3.96 | 3.15 years and 25% vesting annually | |||||||||||||
Granted on December 15, 2016 ** | 389,695 | $ | 4.28 | 5 | 1.79 | % | 62 | % | — | % | $ | 3.14 | $ | 1.21 | 3.15 years and 25% vesting annually | |||||||||||||
Unvested options outstanding as of December 31, 2016 | 1,656,171 | $ | 4.28 | $ | 5.17 | |||||||||||||||||||||||
Issued on March 1, 2017 | 337,000 | $ | 5.56 | 5 | 1.72 | % | 63.5 | % | — | % | $ | 2.60 | $ | 0.90 | 3.75 years and 25% vesting annually over four year term | |||||||||||||
Issued on June 1, 2017 | 18,000 | $ | 4.71 | 5 | 1.56 | % | 64.7 | % | — | % | $ | 2.23 | $ | 0.04 | 3.75 years and 25% vesting annually over four year term | |||||||||||||
Vested during 2017 | (828,085 | ) | $ | 4.28 | $ | 3.12 | $ | (2.60 | ) | |||||||||||||||||||
Forfeitures during 2017 | (3,000 | ) | $ | 5.56 | $ | 2.60 | $ | (0.08 | ) | |||||||||||||||||||
Unvested options outstanding as of December 31, 2017 | 1,180,086 | $ | 4.65 | $ | 2.91 | $ | 3.43 | |||||||||||||||||||||
Vested and unexercised during 2018 | (525,501 | ) | $ | 4.55 | $ | 3.01 | $ | (1.60 | ) | |||||||||||||||||||
Forfeitures during 2018 | (1,875 | ) | $ | 5.56 | $ | 2.60 | $ | (0.05 | ) | |||||||||||||||||||
Exercised during 2018 | (875 | ) | $ | 5.56 | $ | 2.60 | $ | (0.03 | ) | |||||||||||||||||||
Unvested options outstanding as of December 31, 2018 | 651,835 | $ | 4.72 | $ | 3.01 |
For the Years Ended | ||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Stock awards /stock option plans | $ | 9,207,480 | $ | 8,738,615 | $ | 2,206,690 | ||||||
Total stock-based compensation expense | $ | 9,207,480 | $ | 8,738,615 | $ | 2,206,690 |
Three Months ended March 31 | Three Months ended June 30 | Three Months ended September 30 | Three Months ended December 31 | |||||||||||||
Revenues, net | $ | 79,370,609 | $ | 74,938,700 | $ | 69,092,740 | $ | 86,692,209 | ||||||||
Total Operating expenses | 73,051,692 | 65,953,230 | 60,262,456 | 73,220,074 | ||||||||||||
Operating income | 6,318,917 | 8,985,470 | 8,830,284 | 13,472,135 | ||||||||||||
Net income | 52,745 | 3,450,767 | 2,584,822 | 6,486,350 | ||||||||||||
Basic income Per Share | $ | 0.00 | $ | 0.05 | $ | 0.04 | $ | 0.09 | ||||||||
Diluted income Per Share | $ | 0.00 | $ | 0.05 | $ | 0.04 | $ | 0.09 |
Three Months ended March 31 | Three Months ended June 30 | Three Months ended September 30 | Three Months ended December 31, | |||||||||||||
Revenues, net | $ | 45,855,057 | $ | 53,631,224 | $ | 62,710,903 | $ | 74,587,441 | ||||||||
Total Operating expenses | 50,361,713 | 53,938,837 | 64,624,733 | 67,999,398 | ||||||||||||
Operating (loss)/income | (4,506,656 | ) | (307,613 | ) | (1,913,830 | ) | 6,588,043 | |||||||||
Net loss * | (11,068,448 | ) | (5,888,466 | ) | (10,255,346 | ) | (16,584,425 | ) | ||||||||
Basic Loss Per Share | $ | (0.17 | ) | $ | (0.08 | ) | $ | (0.15 | ) | $ | (0.24 | ) | ||||
Diluted Loss Per Share | $ | (0.17 | ) | $ | (0.08 | ) | $ | (0.15 | ) | $ | (0.24 | ) |
SECTION 1. | Amendments to Credit Agreement. The Credit Agreement is, effective as of the Second Amendment Effective Date, and subject to the satisfaction of the conditions precedent set forth in Section 4 below, hereby amended as follows: |
SECTION 2. | Incremental Commitments. |
SECTION 3. | Representations and Warranties. In order to induce the Incremental Lenders party hereto to enter into this Second Amendment, to make the Loans pursuant hereto and to amend the Credit Agreement in the manner provided herein, each Security Party hereby represents and warrants that: |
SECTION 4. | Conditions of Effectiveness. The effectiveness of this Second Amendment (including the amendments contained in Section 1 hereof and agreements contained in Section 2 hereof) are subject to the satisfaction of the following conditions (the date of satisfaction of such conditions being referred to herein as the “Second Amendment Effective Date”): |
SECTION 5. | Effects on Loan Documents. |
SECTION 6. | Expense Reimbursement and Indemnification. The Borrower hereby confirms that the expense reimbursement and indemnification provisions set forth in Section 11.03 of the Credit Agreement as amended by this Second Amendment shall apply to this Second Amendment and the transactions contemplated hereby. |
SECTION 7. | Amendments; Severability. |
SECTION 8. | Governing Law; Waiver of Jury Trial; Jurisdiction. THIS SECOND AMENDMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS SECOND AMENDMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAW OF THE STATE OF NEW YORK (including Sections 5-1401 and 5-1402 of the General Obligations Law but otherwise excluding the laws applicable to conflicts or choice of law). The provisions of Sections 11.09(b), 11.09(c), 11.09(d) and 11.10 of the Credit Agreement as amended by this Second Amendment are incorporated herein by reference, mutatis mutandis. |
SECTION 9. | Headings. Section headings in this Second Amendment are included herein for convenience of reference only, are not part of this Second Amendment and are not to affect the construction of, or to be taken into consideration in interpreting, this Second Amendment. |
SECTION 10. | Counterparts. This Second Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which |
By: | /s/ Christopher J. Chido Name: Christopher J. Chido Title: Attorney-in-fact |
By: | /s/ Christopher J. Chido Name: Christopher J. Chido Title: Attorney-in-fact |
Incremental Lenders | Incremental Commitments |
ABN AMRO CAPITAL USA LLC | $4,266,666.67 |
DVB BANK SE, AMSTERDAM BRANCH | $4,266,666.66 |
SKANDINAVISKA ENSKILDA BANKEN AB (PUBL) | $4,266,666.67 |
Vessel | IMO Number | Build Year | Maximum Vessel Borrowing Amount | Quarterly Installment Amount |
M/V Mystic Eagle | 9575204 | 2013 | $6,800,000.00 | $185,611.73 |
M/V Southport Eagle | 9575228 | 2013 | $6,800,000.00 | $180,640.47 |
M/V Stonington Eagle | 9575151 | 2012 | $6,000,000.00 | $178,338.76 |
M/V Greenwich Eagle | 9575266 | 2013 | $6,800,000.00 | $174,444.76 |
M/V Fairfield Eagle | 9575230 | 2013 | $6,800,000.00 | $179,076.48 |
M/V Groton Eagle | 9575242 | 2013 | $6,800,000.00 | $177,488.56 |
Vessel | IMO Number | Build Year | Maximum Vessel Borrowing Amount | Quarterly Installment Amount |
M/V Westport Eagle | 9705988 | 2015 | $7,600,000.00 | $171,446.23 |
M/V Madison Eagle | 9575278 | 2013 | $6,800,000.00 | $172,937.57 |
M/V Rowayton Eagle | 9575216 | 2013 | $6,800,000.00 | $182,285.55 |
Vessel | IMO Number | Build Year | Maximum Vessel Borrowing Amount | Quarterly Installment Amount |
M/V New London Eagle | 9754991 | 2015 | $8,600,000 | $185,301.06 |
M/V Hamburg Eagle | 9698587 | 2014 | $12,800,000 | $297,674.72 |
1.01 | Defined Terms 1 |
1.02 | Terms Generally 30 |
1.03 | Accounting Terms; Changes in GAAP 31 |
1.04 | Rates 31 |
2.01 | Commitments 31 |
2.02 | Loans and Borrowings. 32 |
2.03 | Borrowing Requests 32 |
2.04 | Funding of Borrowings 32 |
2.05 | Interest Periods 33 |
2.06 | Repayment 33 |
2.07 | Prepayments 34 |
2.08 | Cancellation of Commitments 36 |
2.09 | Interest 36 |
2.10 | Fees 37 |
2.11 | Evidence of Debt 37 |
2.12 | Payments Generally; Several Obligations of Lenders and Swap Banks 37 |
2.13 | Sharing of Payments 38 |
2.14 | Compensation for Losses 39 |
2.15 | Increased Costs 39 |
2.16 | Taxes 40 |
2.17 | Inability to Determine Rates; LIBOR Replacement 43 |
2.18 | Illegality 46 |
2.19 | Mitigation Obligations; Replacement of Lenders 46 |
2.20 | Defaulting Lenders 47 |
2.21 | Increases in Term Facility Commitments 48 |
3.01 | Existence, Qualification and Power 50 |
3.02 | Authorization; No Contravention 50 |
3.03 | Governmental Authorization; Other Consents 50 |
3.04 | Execution and Delivery; Binding Effect 51 |
3.05 | Financial Statements; No Material Adverse Effect 51 |
3.06 | Litigation 51 |
3.07 | No Material Adverse Effect; No Default 51 |
3.08 | Property 51 |
3.09 | Taxes 52 |
3.10 | Disclosure 53 |
3.11 | Compliance with Laws 53 |
3.12 | ERISA Compliance 53 |
3.13 | Environmental Matters 54 |
3.14 | Margin Regulations 54 |
3.15 | Investment Company, Public Utility 54 |
3.16 | PATRIOT Act; Sanctions; Anti-Corruption; Anti-Money-Laundering 54 |
3.17 | ISM Code, ISPS Code and MARPOL Compliance 55 |
3.18 | Solvency 55 |
3.19 | Place of Business 55 |
3.20 | Ownership 56 |
3.21 | Vessels 56 |
3.22 | The Security Documents 56 |
3.23 | Use of Proceeds 57 |
3.24 | Beneficial Ownership Certification 57 |
3.25 | No Immunity 57 |
4.01 | Conditions Precedent to the Closing Date 57 |
4.02 | Conditions Precedent to Each Borrowing 59 |
4.03 | Conditions Precedent to Each Borrowing for Each Vessel 60 |
5.01 | Financial Statements 62 |
5.02 | Certificates; Other Information 63 |
5.03 | Vessel Valuations 64 |
5.04 | Vessel Value Maintenance 64 |
5.05 | Notices 64 |
5.06 | Preservation of Existence, Etc. 65 |
5.07 | [Intentionally Omitted] 65 |
5.08 | Maintenance of Properties 65 |
5.09 | Insurances 65 |
5.10 | Insurance Documentation; Letters of Undertaking; Certificates 67 |
5.11 | Mortgagee’s Insurance 68 |
5.12 | Maintenance of Security Interests 68 |
5.13 | Earnings Payments 68 |
5.14 | Payment of Obligations 68 |
5.15 | Vessel Registration 68 |
5.16 | Vessel Repair 68 |
5.17 | Classification Society Instructions and Undertakings 68 |
5.18 | Charters; Charter Assignments; Assignments of Earnings 69 |
5.19 | Compliance with Laws 69 |
5.20 | [Intentionally Omitted] 69 |
5.21 | Environmental Matters 69 |
5.22 | Books and Records 69 |
5.23 | Inspection Rights 69 |
5.24 | Surveys 70 |
5.25 | Notice of Mortgage 70 |
5.26 | Green Passport 70 |
5.27 | [Intentionally Omitted]. 70 |
5.28 | Prevention of and Release from Arrest 70 |
5.29 | Use of Proceeds 70 |
5.30 | Subordination of Loans 70 |
5.31 | Anti-Corruption Laws 71 |
5.32 | “Know Your Customer” Documentation 71 |
5.33 | Asset Control 71 |
5.34 | Scrapping 71 |
5.35 | Sanctions 71 |
5.36 | Treasury Transactions 71 |
6.01 | Indebtedness 72 |
6.02 | Liens 72 |
6.03 | Fundamental Changes 73 |
6.04 | Restricted Payments 73 |
6.05 | Investments 73 |
6.06 | Transactions with Affiliates 73 |
6.07 | Changes in Fiscal Periods 74 |
6.08 | Changes in Nature of Business 74 |
6.09 | Changes in Name; Organizational Documents Amendments 74 |
6.10 | Place of Business 74 |
6.11 | Change of Control; Negative Pledge 74 |
6.12 | Restriction on Chartering 74 |
6.13 | Lawful Use 74 |
6.14 | Approved Manager 75 |
6.15 | Insurances 75 |
6.16 | Modification; Removal of Parts 75 |
6.17 | Sanctions 75 |
6.18 | No Financial Support to the Restricted Subsidiary 76 |
7.01 | Financial Covenants 76 |
8.01 | Guaranty 77 |
8.02 | Obligations Unconditional 78 |
8.03 | Reinstatement 78 |
8.04 | Subrogation; Subordination 79 |
8.05 | Remedies 79 |
8.06 | Instrument for the Payment of Money 79 |
8.07 | Continuing Guarantee 79 |
8.08 | General Limitation on Guarantee Obligations 79 |
8.09 | Right of Contribution 79 |
8.10 | Set-off 79 |
8.11 | Keepwell 80 |
8.12 | Parallel Liability. 80 |
9.01 | Events of Default 81 |
9.02 | Application of Payments 83 |
10.01 | Appointment and Authority 84 |
10.02 | Rights as a Lender 85 |
10.03 | Exculpatory Provisions 85 |
10.04 | Reliance by Agent 86 |
10.05 | Delegation of Duties 87 |
10.06 | Resignation of Agent 87 |
10.07 | Non-Reliance on Agents and Other Lenders 88 |
10.08 | No Other Duties 88 |
10.09 | Facility Agent May File Proofs of Claim 88 |
10.10 | Collateral and Guaranty Matters 89 |
11.01 | Notices 89 |
11.02 | Waivers; Amendments 91 |
11.03 | Expenses; Indemnity; Damage Waiver 93 |
11.04 | Successors and Assigns 94 |
11.05 | Survival 97 |
11.06 | Counterparts; Integration; Effectiveness; Electronic Execution 97 |
11.07 | Severability 98 |
11.08 | Right of Setoff 98 |
11.09 | Governing Law; Jurisdiction; Etc. 98 |
11.10 | WAIVER OF JURY TRIAL 99 |
11.11 | Headings 99 |
11.12 | Treatment of Certain Information; Confidentiality 99 |
11.13 | PATRIOT Act 100 |
11.14 | Interest Rate Limitation 100 |
11.15 | Payments Set Aside 101 |
11.16 | No Advisory or Fiduciary Responsibility 101 |
11.17 | Acknowledgement and Consent to Bail-In of EEA Financial Institutions 101 |
EXHIBIT A | – Form of Account Pledge |
EXHIBIT B | – Form of Assignment and Assumption |
EXHIBIT C | – Form of Assignment of Earnings |
EXHIBIT D | – Form of Assignment of Insurances |
EXHIBIT E | – Form of Borrowing Request |
EXHIBIT F | – Form of Charter Assignment |
EXHIBIT G | – Form of Guarantor Accession Agreement |
EXHIBIT H | – Form of Manager’s Undertaking |
EXHIBIT I | – Form of Master Agreement Assignment |
EXHIBIT J | – Form of Membership Interest Pledge |
EXHIBIT K | – Form of Vessel Mortgage |
EXHIBIT L | – Form of Note |
EXHIBIT M-1 | – Form of U.S. Tax Compliance Certificate |
EXHIBIT M-2 | – Form of U.S. Tax Compliance Certificate |
EXHIBIT M-3 | – Form of U.S. Tax Compliance Certificate |
EXHIBIT M-4 | – Form of U.S. Tax Compliance Certificate |
By /s/ Gary Vogel | Name: Gary Vogel Title: Chief Executive Officer |
By /s/ Gary Vogel | Name: Gary Vogel Title: Chief Executive Officer |
GANNET SHIPPING LLC, | JAY SHIPPING LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
GOLDEN EAGLE SHIPPING LLC, | KINGFISHER SHIPPING LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
GREBE SHIPPING LLC, | MARTIN SHIPPING LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
IBIS SHIPPING LLC, | NIGHTHAWK SHIPPING LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
IMPERIAL EAGLE SHIPPING LLC, | CAPE TOWN EAGLE LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
FAIRFIELD EAGLE LLC, | ROWAYTON EAGLE LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
MYSTIC EAGLE LLC, | MADISON EAGLE LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
SOUTHPORT EAGLE LLC, | WESTPORT EAGLE LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
STONINGTON EAGLE LLC, | GREENWICH EAGLE LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
GROTON EAGLE LLC, | NEW LONDON EAGLE LLC, |
as Guarantor | as Guarantor |
By /s/ Andrea Jansz | By_/s/ Andrea Jansz |
By /s/ Nicholas Santangelo | Name: Nicholas Santangelo Title: Attorney-in-Fact |
By /s/ Manon Didler | Name:Manon Didler Title: Senior Associate |
By /s/ Alexander Foley | Name:Alexander Foley Title: Senior Associate |
By /s/ Per Barre | Name:Per Barre Title: Vice President |
By /s/ Tom Racanell | Name: Tom Racanell Title: SVP |
By /s/ Michael Markowitz | Name: Michael Markowitz Title: First Vice President & Assistant General Counsel |
By /s/ Alexander Bolann | Name: Alexander Bolann Title: First Vice President |
By /s/ Nicholas Santangelo | Name: Nicholas Santangelo Title: Attorney-in-Fact |
By/s/ Nicholas Santangelo | Name: Nicholas Santangelo Title: Attorney-in-Fact |
By /s/ Nicholas Santangelo | Name: Nicholas Santangelo Title: Attorney-in-Fact |
By /s/ Michael Markowitz | Name: Michael Markowitz Title: First Vice President & Assistant General Counsel |
By /s/ Alexander Bolann | Name: Alexander Bolann Title: First Vice President |
By /s/ Manon Didler | Name: Manon Didler Title: Senior Associate |
By /s/ Alexander Foley | Name: Alexander Foley Title: Senior Associate |
By /s/ Per Barre | Name:Per Barre Title: Vice President |
By /s/ Tom Racanell | Name: Tom Racanell Title: SVP |
By /s/ Nicholas Santangelo | Name: Nicholas Santangelo Title: Attorney-in-Fact |
By /s/ Manon Didler | Name: Manon Didler Title: Senior Associate |
By /s/ Alexander Foley | Name: Alexander Foley Title: Senior Associate |
By /s/ Per Barre | Name:Per Barre Title: Vice President |
By /s/ Tom Racanell | Name: Tom Racanell Title: SVP |
By /s/ Tor Ivar Hanson | Name: Tor Ivar Hanson Title: Managing Director |
By /s/ Emilio Fabbrizzi | Name: Emilio Fabbrizzi Title: Managing Director |
LENDERS | TERM FACILITY COMMITMENTS | REVOLVING FACILITY COMMITMENTS |
ABN AMRO CAPITAL USA LLC Address for Notices: ABN AMRO Capital USA LLC 100 Park Avenue, 17th floor New York, NY 10017 with a copy to: Wudasse Zaudou ABN AMRO Capital USA LLC 100 Park Avenue, 17th floor New York, NY 10017 Telephone: +917-284-6697 Email: wudasse.zaudou@abnamro.com Lending Office: ABN AMRO Capital USA LLC 100 Park Avenue, 17th floor New York, NY 10017 | $29,523,809.52 | $10,476,190.48 |
CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK Address for Notices: Asset Finance Groups – Ship Finance 12 Place des Etats-Unis CS 70052 92547 Montrouge Cedex, France Attn : Agency and Middle-Office for Shipping Telephone: +33 1 41892079 / +33 1 41898696 Email: clementine.costil@ca-cib.com / rosine.serra-joannides@ca-cib.com Crédit Agricole Corporate and Investment Bank 1301 Avenue of the Americas New York, New York 10019 United States Attn: Jerome Duval / Manon Didier Telephone: +1 212 261 4039 / +1 212 261 7363 Email: Jerome.duval@ca-cib.com / manon.didier@ca-cib.com / NYShipFinance@ca-cib.com Lending Office: Asset Finance Groups – Ship Finance 12 Place des Etats-Unis CS 70052 92547 Montrouge Cedex, France | $29,523,809.52 | $10,476,190.48 |
SKANDINAVISKA ENSKILDA BANKEN AB (PUBL) Address for Notices: Skandinaviska Enskilda Banken AB (publ) Structured Credit Operations Rissneleden 110 SE-106 40 Stockholm Sweden Lending Office: Skandinaviska Enskilda Banken AB (publ) Structured Credit Operations Rissneleden 110 SE-106 40 Stockholm Sweden | $29,523,809.52 | $10,476,190.48 |
DNB CAPITAL LLC Address for Notices: DNB Bank ASA 200 Park Avenue | 31st Floor | New York | NY 10166 with a copy to: Sybille Andaur / Samantha Stone / Michael Davidowsky DNB Bank ASA 200 Park Avenue | 31st Floor | New York | NY 10166 Sybille Andaur (Sybille.andaur@dnb.no) / Samantha Stone (samantha.stone@dnb.no & agencyny@dnb.no) / Michael Davidowsky Lending Office: DNB Bank ASA 200 Park Avenue | 31st Floor | New York | NY 10166 | $29,523,809.52 | $10,476,190.48 |
DANISH SHIP FINANCE A/S Address for Notices: Sankt Annae Plads 3, DK-1250 Copenhagen K with a copy to: Ole Staergaard Senior Relationship Manager Loan Administration Sankt Annae Plads 3, DK-1250 Copenhagen K Telephone no.: +45 33 33 93 33 Facsimile no.: +45 33 33 96 66 E-mail address: Loanadmin@skibskredit.dk & Ols@skibskredit.dk Lending Office: Sankt Annae Plads 3, DK-1250 Copenhagen K | $18,452,380.96 | $6,547,619.04 |
NORDEA BANK ABP, NEW YORK BRANCH Address for Notices: 1211 Avenue of the Americas, New York, NY 10036 Henning Lyche Christiansen +1 212 318 9632 henning.christiansen@nordea.com Lending Office: 1211 Avenue of the Americas, New York, NY 10036 Henning Lyche Christiansen +1 212 318 9632 henning.christiansen@nordea.com | $18,452,380.96 | $6,547,619.04 |
TOTAL | $155,000,000 | $55,000,000 |
ABN AMRO BANK N.V. Address for Notices: ABN AMRO Bank N.V. Daalsesingel 71 3511 SW Utrecht The Netherlands with a copy to: Wudasse Zaudou ABN AMRO Capital USA LLC 100 Park Avenue, 17th floor New York, NY 10017 Telephone: +917-284-6697 Email: wudasse.zaudou@abnamro.com |
NORDEA BANK ABP Address for Notices: c/o Nordea Danmark, filial af Nordea Bank Abp, Finland 7288 Derivatives Services Postbox 850 DK-0900 Copenhagen K, Denmark |
DNB BANK ASA, NEW YORK BRANCH Address for Notices: Address for Notices: DNB Bank ASA 200 Park Avenue | 31st Floor | New York | NY 10166 with a copy to: Sybille Andaur / Samantha Stone / Michael Davidowsky DNB Bank ASA 200 Park Avenue | 31st Floor | New York | NY 10166 Sybille Andaur (Sybille.andaur@dnb.no) / Samantha Stone (samantha.stone@dnb.no & agencyny@dnb.no) / Michael Davidowsky |
CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK Address for Notices: 1301 Avenue of the Americas New York, NY, 10019 USA Tel: +1 212.261.7562 Fax: +1 212.261.3699 Attn: Daniel Hansen - Corporate Derivative Solutions Email: daniel.hansen@ca-cib.com / jeffrey.kim@ca-cib.com |
SKANDINAVISKA ENSKILDA BANKEN AB (PUBL) Address for Notices: Skandinaviska Enskilda Banken AB (publ) Structured Credit Operations Rissneleden 110 SE-106 40 Stockholm Sweden |
Guarantor | Jurisdiction of Formation | Registration Number (or equivalent, if any) | Registered Office |
GANNET SHIPPING LLC | The Republic of the Marshall Islands | 961584 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
GOLDEN EAGLE SHIPPING LLC | The Republic of the Marshall Islands | 960908 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
GREBE SHIPPING LLC | The Republic of the Marshall Islands | 961585 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
IBIS SHIPPING LLC | The Republic of the Marshall Islands | 961586 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
IMPERIAL EAGLE SHIPPING LLC | The Republic of the Marshall Islands | 960909 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
JAY SHIPPING LLC | The Republic of the Marshall Islands | 961654 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
KINGFISHER SHIPPING LLC | The Republic of the Marshall Islands | 961655 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
MARTIN SHIPPING LLC | The Republic of the Marshall Islands | 961656 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
NIGHTHAWK SHIPPING LLC | The Republic of the Marshall Islands | 961842 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
CAPE TOWN EAGLE LLC | The Republic of the Marshall Islands | 964456 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
FAIRFIELD EAGLE LLC | The Republic of the Marshall Islands | 963789 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
MYSTIC EAGLE LLC | The Republic of the Marshall Islands | 963790 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
SOUTHPORT EAGLE LLC | The Republic of the Marshall Islands | 963786 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
STONINGTON EAGLE LLC | The Republic of the Marshall Islands | 963825 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
GROTON EAGLE LLC | The Republic of the Marshall Islands | 963826 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
ROWAYTON EAGLE LLC | The Republic of the Marshall Islands | 963788 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
MADISON EAGLE LLC | The Republic of the Marshall Islands | 963791 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
WESTPORT EAGLE LLC | The Republic of the Marshall Islands | 963827 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
GREENWICH EAGLE LLC | The Republic of the Marshall Islands | 963787 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
NEW LONDON EAGLE LLC | The Republic of the Marshall Islands | 964089 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
HAMBURG EAGLE LLC | The Republic of the Marshall Islands | 964288 | Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 |
Vessel | Official Number | IMO Number | Build Year | Owner |
1. GANNET BULKER | 3902 | 9441300 | 2010 | Gannet Shipping LLC |
2. GOLDEN EAGLE | 3794 | 9418731 | 2010 | Golden Eagle Shipping LLC |
3. GREBE BULKER | 3905 | 9441312 | 2010 | Grebe Shipping LLC |
4. IBIS BULKER | 3946 | 9441324 | 2010 | Ibis Shipping LLC |
5. IMPERIAL EAGLE | 3820 | 9478511 | 2010 | Imperial Eagle Shipping LLC |
6. JAY | 3972 | 9441336 | 2010 | Jay Shipping LLC |
7. KINGFISHER | 3974 | 9441348 | 2010 | Kingfisher Shipping LLC |
8. MARTIN | 3973 | 9441350 | 2010 | Martin Shipping LLC |
9. NIGHTHAWK | 4193 | 9441362 | 2011 | Nighthawk Shipping LLC |
10. WESTPORT EAGLE | 7507 | 9705988 | 2015 | Westport Eagle LLC |
11. FAIRFIELD EAGLE | 7510 | 9575230 | 2013 | Fairfield Eagle LLC |
12. GREENWICH EAGLE | 7449 | 9575266 | 2013 | Greenwich Eagle LLC |
13. MADISON EAGLE | 7509 | 9575278 | 2013 | Madison Eagle LLC |
14. MYSTIC EAGLE | 7405 | 9575204 | 2013 | Mystic Eagle LLC |
15. ROWAYTON EAGLE | 7454 | 9575216 | 2013 | Rowayton Eagle LLC |
16. SOUTHPORT EAGLE | 7406 | 9575228 | 2013 | Southport Eagle LLC |
17. GROTON EAGLE | 7505 | 9575242 | 2013 | Groton Eagle LLC |
18. NEW LONDON EAGLE | 7824 | 9754991 | 2015 | New London Eagle LLC |
19. STONINGTON EAGLE | 7450 | 9575151 | 2012 | Stonington Eagle LLC |
20. HAMBURG EAGLE | 8164 | 9698587 | 2014 | Hamburg Eagle LLC |
21. CAPE TOWN EAGLE | 8273 | 9700134 | 2015 | Cape Town Eagle LLC |
1. | $150,000 per Vessel per annum for commercial management services inclusive of operations in the first year following the Closing Date, subject to annual increases thereafter, as fairly and reasonably determined by the relevant Upstream Guarantor, at arm’s length and in line with market standards. |
2. | $135,000 per Vessel per annum for technical management in the first year following the Closing Date, subject to annual increases thereafter, as fairly and reasonably determined by the relevant Upstream Guarantor at arm’s length and in line with market standards. |
3. | 1.0% fee for any vessel purchase or subsequent sale. |
Fiscal Quarter After Initial Borrowing Date | Term Facility Borrowing Outstanding | Quarterly Repayment Installment |
0 | $155,000,000 | |
1 | $148,700,000 | $6,300,000 |
2 | $142,400,000 | $6,300,000 |
3 | $136,100,000 | $6,300,000 |
4 | $129,800,000 | $6,300,000 |
5 | $123,500,000 | $6,300,000 |
6 | $117,200,000 | $6,300,000 |
7 | $110,900,000 | $6,300,000 |
8 | $104,600,000 | $6,300,000 |
9 | $98,300,000 | $6,300,000 |
10 | $92,000,000 | $6,300,000 |
11 | $85,700,000 | $6,300,000 |
12 | $79,400,000 | $6,300,000 |
13 | $73,100,000 | $6,300,000 |
14 | $66,800,000 | $6,300,000 |
15 | $60,500,000 | $6,300,000 |
16 | $54,200,000 | $6,300,000 |
17 | $47,900,000 | $6,300,000 |
18 | $41,600,000 | $6,300,000 |
19 | $35,300,000 | $6,300,000 |
20 | $29,000,000 | $6,300,000 |
Fiscal Quarter After Initial Borrowing Date | Max Cumulative Amount Payable Under Sweep | ||
0 | |||
1 | $1,200,000 | ||
2 | $2,400,000 | ||
3 | $3,600,000 | ||
4 | $4,800,000 max | ||
5 | $4,500,000 | ||
6 | $4,200,000 | ||
7 | $3,900,000 | ||
8 | $3,600,000 | ||
9 | $3,300,000 | ||
10 | $3,000,000 | ||
11 | $2,700,000 | ||
12 | $2,400,000 | ||
13 | $2,100,000 | ||
14 | $1,800,000 | ||
15 | $1,500,000 | ||
16 | $1,200,000 | ||
17 | $900,000 | ||
18 | $600,000 | ||
19 | $300,000 | ||
20 |
Name of Significant Subsidiary | Jurisdiction of Incorporation |
Eagle Shipping LLC | Marshall Islands |
Eagle Bulk Management LLC | Marshall Islands |
Eagle Shipping International (USA) LLC | Marshall Islands |
Eagle Ship Management LLC | Delaware |
Eagle Management Consultants LLC | Delaware |
Eagle Bulk Pte. Ltd. | Singapore |
Eagle Bulk Holdco LLC | Marshall Islands |
Eagle Bulk Shipco LLC | Marshall Islands |
Eagle Bulk Ultraco LLC | Marshall Islands |
Eagle Bulk Delaware LLC | Delaware |
Eagle Bulk Dynaco LLC | Marshall Island |
Eagle Bulk Europe GmbH | Germany |
Avocet Shipping LLC | Marshall Islands |
Bittern Shipping LLC | Marshall Islands |
Canary Shipping LLC | Marshall Islands |
Cape Town Eagle LLC | Marshall Islands |
Cardinal Shipping LLC | Marshall Islands |
Condor Shipping LLC | Marshall Islands |
Crane Shipping LLC | Marshall Islands |
Crested Eagle Shipping LLC | Marshall Islands |
Crowned Eagle Shipping LLC | Marshall Islands |
Egret Shipping LLC | Marshall Islands |
Fairfield Eagle LLC | Marshall Islands |
Gannet Shipping LLC | Marshall Islands |
Greenwich Eagle LLC | Marshall Islands |
Golden Eagle Shipping LLC | Marshall Islands |
Goldeneye Shipping LLC | Marshall Islands |
Grebe Shipping LLC | Marshall Islands |
Groton Eagle LLC | Marshall Islands |
Hawk Shipping LLC | Marshall Islands |
Hamburg Eagle LLC | Marshall Islands |
Ibis Shipping LLC | Marshall Islands |
Imperial Eagle Shipping LLC | Marshall Islands |
Jaeger Shipping LLC | Marshall Islands |
Jay Shipping LLC | Marshall Islands |
Kestrel Shipping LLC | Marshall Islands |
Kingfisher Shipping LLC | Marshall Islands |
Kittiwake Shipping LLC | Marshall Islands |
Madison Eagle LLC | Marshall Islands |
Martin Shipping LLC | Marshall Islands |
Merlin Shipping LLC | Marshall Islands |
Mystic Eagle LLC | Marshall Islands |
New London Eagle LLC | Marshall Islands |
Nighthawk Shipping LLC | Marshall Islands |
Oriole Shipping LLC | Marshall Islands |
Osprey Shipping LLC | Marshall Islands |
Owl Shipping LLC | Marshall Islands |
Petrel Shipping LLC | Marshall Islands |
Puffin Shipping LLC | Marshall Islands |
Roadrunner Shipping LLC | Marshall Islands |
Rowayton Eagle LLC | Marshall Islands |
Sandpiper Shipping LLC | Marshall Islands |
Singapore Eagle LLC | Marshall Islands |
Shrike Shipping LLC | Marshall Islands |
Skua Shipping LLC | Marshall Islands |
Southport Eagle LLC | Marshall Islands |
Sparrow Shipping LLC | Marshall Islands |
Stamford Eagle LLC | Marshall Islands |
Stellar Eagle Shipping LLC | Marshall Islands |
Stonington Eagle LLC | Marshall Islands |
Tern Shipping LLC | Marshall Islands |
Thrasher Shipping LLC | Marshall Islands |
Thrush Shipping LLC | Marshall Islands |
Woodstar Shipping LLC | Marshall Islands |
Wren Shipping LLC | Marshall Islands |
Westport Eagle LLC | Marshall Islands |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Mar. 11, 2019 |
Jun. 29, 2018 |
|
Document And Entity Information | |||
Entity Registrant Name | Eagle Bulk Shipping Inc. | ||
Entity Central Index Key | 0001322439 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Common Stock, Shares Outstanding (in shares) | 73,185,184 | ||
Entity Public Float | $ 195,812,577 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Emerging Growth Company | false | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Amendment Flag | false |
Consolidated Balance Sheets (Parentheticals) - USD ($) |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts receivable, reserve | $ 2,073,616 | $ 3,501,964 |
Accumulated depreciation, vessels | 124,907,998 | 99,910,416 |
Accumulated amortization, other fixed assets | $ 547,452 | $ 343,799 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 700,000,000 | 700,000,000 |
Common stock, issued (in shares) | 71,055,400 | 70,394,307 |
Common stock, outstanding (in shares) | 71,055,400 | 70,394,307 |
Consolidated Statements of Operations - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Income Statement [Abstract] | |||
Revenues, net | $ 310,094,258 | $ 236,784,625 | $ 124,492,844 |
Voyage expenses | 79,566,452 | 62,351,252 | 42,093,714 |
Vessel expenses | 81,336,260 | 78,607,244 | 74,016,763 |
Charter hire expenses | 38,045,778 | 31,283,956 | 12,845,468 |
Depreciation and amortization | 37,717,462 | 33,690,686 | 38,884,322 |
General and administrative expenses | 36,156,660 | 33,126,310 | 22,905,802 |
Restructuring charges | 0 | 0 | 5,869,025 |
(Gain)/loss on sale of vessels | (335,160) | (2,134,767) | 101,860 |
Vessel impairment | 0 | 0 | 129,027,862 |
Total operating expenses | 272,487,452 | 236,924,681 | 325,744,816 |
Operating income/(loss) | 37,606,806 | (140,056) | (201,251,972) |
Interest expense | 25,743,531 | 29,376,994 | 21,799,146 |
Interest expense | (585,168) | (651,069) | (215,433) |
Other (income)/expense | (126,241) | (37,905) | 686,750 |
Loss on debt extinguishment | 0 | 14,968,609 | 0 |
Total other expense, net | 25,032,122 | 43,656,629 | 22,270,463 |
Net income/(loss) | $ 12,574,684 | $ (43,796,685) | $ (223,522,435) |
Weighted average shares outstanding: | |||
Basic (in shares) | 70,665,212 | 69,182,302 | 20,565,652 |
Diluted (in shares) | 71,802,173 | 69,182,302 | 20,565,652 |
Per share amounts: | |||
Basic income/(loss) (in dollars per share) | $ 0.18 | $ (0.63) | $ (10.87) |
Diluted net income/(loss) (in dollars per share) | $ 0.18 | $ (0.63) | $ (10.87) |
Consolidated Statements of Comprehensive Income/(Loss) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Statement of Comprehensive Income [Abstract] | |||
Net income/(loss) | $ 12,574,684 | $ (43,796,685) | $ (223,522,435) |
Total other comprehensive income/(loss) | 0 | 0 | 0 |
Comprehensive income/(loss) | $ 12,574,684 | $ (43,796,685) | $ (223,522,435) |
Consolidated Statements of Changes in Stockholders' Equity - USD ($) |
Total |
Common Stock |
Additional paid-in Capital |
Accumulated Deficit |
||
---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2015 | 1,883,303 | |||||
Beginning balance at Dec. 31, 2015 | $ 518,344,462 | $ 18,833 | $ 678,171,322 | $ (159,845,693) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | (223,522,435) | (223,522,435) | ||||
Issuance of shares in connection with Second Lien Loan Agreement (in shares) | 16,889,828 | |||||
Issuance of shares in connection with Second Lien Loan Agreement | 17,756,325 | $ 168,899 | 17,587,426 | |||
Issuance of shares for private placement, net of issuance costs (in shares) | 29,333,318 | |||||
Issuance of shares for private placement, net of issuance costs | 85,700,535 | $ 293,333 | 85,407,202 | |||
Reverse stock split adjustment (in shares) | [1] | (32) | ||||
Issuance of shares due to vesting of restricted shares (in shares) | 410 | |||||
Issuance of shares due to vesting of restricted shares | $ 4 | (4) | ||||
Cash used to settle net share equity awards | (2,938) | (2,938) | ||||
Stock-based compensation | 2,206,690 | 2,206,690 | ||||
Ending balance (in shares) at Dec. 31, 2016 | 48,106,827 | |||||
Ending balance at Dec. 31, 2016 | 400,482,639 | $ 481,069 | 783,369,698 | (383,368,128) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | (43,796,685) | (43,796,685) | ||||
Issuance of shares for private placement, net of issuance costs (in shares) | 22,222,223 | |||||
Issuance of shares for private placement, net of issuance costs | 96,030,003 | $ 222,222 | 95,807,781 | |||
Issuance of shares due to vesting of restricted shares (in shares) | 65,257 | |||||
Issuance of shares due to vesting of restricted shares | 0 | $ 653 | (653) | |||
Cash used to settle net share equity awards | (289,539) | (289,539) | ||||
Stock-based compensation | 8,738,615 | 8,738,615 | ||||
Ending balance (in shares) at Dec. 31, 2017 | 70,394,307 | |||||
Ending balance at Dec. 31, 2017 | 461,165,033 | $ 703,944 | 887,625,902 | (427,164,813) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income/(loss) | 12,574,684 | 12,574,684 | ||||
Issuance of shares due to vesting of restricted shares and exercise of options, net of cash received (in shares) | 661,093 | |||||
Issuance of shares due to vesting of restricted shares and exercise of options, net of cash received | 4,866 | $ 6,611 | (1,745) | |||
Cash used to settle net share equity awards | (2,559,104) | (2,559,104) | ||||
Stock-based compensation | 9,207,480 | 9,207,480 | ||||
Ending balance (in shares) at Dec. 31, 2018 | 71,055,400 | |||||
Ending balance at Dec. 31, 2018 | $ 479,605,849 | $ 710,555 | $ 894,272,533 | $ (415,377,239) | ||
|
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) |
Aug. 05, 2016
$ / shares
|
---|---|
Statement of Stockholders' Equity [Abstract] | |
Reverse stock split | 0.2 |
Common stock, par value (in dollars per share) | $ 0.01 |
Consolidated Statements of Cash Flows (Parenthetical) |
Dec. 08, 2017
USD ($)
|
---|---|
Second Lien Facility | |
Payment-in-kind interest on Second Lien Facility | $ 17,700,000 |
General Information |
12 Months Ended |
---|---|
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General Information | General Information: The accompanying consolidated financial statements include the accounts of Eagle Bulk Shipping Inc. and its wholly-owned subsidiaries (collectively, the "Company,” “we” or “our” or similar terms). The Company is engaged in the ocean transportation of drybulk cargoes worldwide through the ownership, charter and operation of drybulk vessels. The Company's fleet is comprised of Supramax and Ultramax bulk carriers and the Company operates its business in one business segment. Each of the Company’s vessels serve the same type of customer, have similar operation and maintenance requirements, operate in the same regulatory environment, and are subject to similar economic characteristics. Based on this, the Company has determined that it operates in one reportable segment, which is engaged in the ocean transportation of drybulk cargoes worldwide through the ownership and operation of drybulk carrier vessels. The Company is a holding company incorporated in 2005, under the laws of the Republic of the Marshall Islands and is the sole owner of all of the outstanding shares of its wholly-owned subsidiaries formed in the Republic of the Marshall Islands. The primary activity of each of the subsidiaries is the ownership of a vessel. The operations of the vessels are managed by an indirectly wholly-owned subsidiary of the Company, Eagle Bulk Management LLC, a Republic of the Marshall Islands limited liability company. As of December 31, 2018, the Company owned and operated a modern fleet of 47 oceangoing vessels, including 34 Supramax and 13 Ultramax vessels, with a combined carrying capacity of 2,705,764 dwt and an average age of approximately 9.0 years. Additionally, the Company chartered in three Ultramax vessels for periods ranging between one to four years. Please see Note 10. Commitments and Contingencies to the consolidated financial statements. For the years ended December 31, 2018, 2017 and 2016, the Company had no charterers which individually accounted for more than 10% of the Company's gross charter revenue. |
Equity Offerings |
12 Months Ended |
---|---|
Dec. 31, 2018 | |
Equity [Abstract] | |
Equity Offerings | Equity Offerings On December 13, 2016, the Company entered into a Stock Purchase Agreement with certain investors (the “Investors”), pursuant to which the Company agreed to issue to the Investors in a private placement (the “December Private Placement”) approximately 22.2 million shares of the Company’s common stock, par value $0.01 per share, at an initial purchase price of $4.50 per share, for aggregate gross proceeds of $100.0 million. On January 20, 2017, the Company closed its previously announced December Private Placement for aggregate net proceeds of $96.0 million. On July 1, 2016 and July 10, 2016, respectively, the Company entered into Common Stock Purchase Agreements (collectively, the “Common Stock Purchase Agreements”), with certain purchasers (the “Common Stock Purchasers”). The Common Stock Purchasers include certain of our existing shareholders, who held approximately 70% of our outstanding equity prior to entry into the Common Stock Purchase Agreements and prior to giving effect to the delivery of all of the shares of common stock issued in connection with the Second Lien Loan Agreement, as well as our Chairman and Chief Executive Officer. The Common Stock Purchase Agreements provided for the issuance and sale by the Company to the Common Stock Purchasers of an aggregate amount of $88.0 million of common stock, at an initial price per share of $3.00. On August 10, 2016, the Company closed the transactions contemplated by the Common Stock Purchase Agreements for aggregate proceeds of $85.7 million net of fees and legal expenses. After giving effect to the Reverse Stock Split, the private placement included the issuance of 29,333,318 shares of the Company’s common stock. The Company used the proceeds of the private placement for the acquisition of drybulk vessels and general corporate purposes. The Company principally used the proceeds from both the private placements to partially finance the acquisition of 11 Ultramax vessels during 2017 and 2016. In 2016, the Company issued 16,889,828 shares of common stock to the lenders of the Second Lien Facility (defined herein) pro rata based on their participation in the Second Lien Facility. The Company has proportionately allocated the proceeds from the Second Lien Loan Agreement based on the relative fair values of the Second Lien Facility and the common stock issued to the Second Lien Lenders. The difference between the $60.0 million principal value of the Second Lien Facility and its relative fair value, amounting to approximately $17.8 million, was allocated to the issued shares. |
Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies | Significant Accounting Policies:
The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. When the estimate of undiscounted cash flows, excluding interest charges, expected to be generated by the use of the asset is less than its carrying amount, the Company will evaluate the asset for an impairment loss. Measurement of the impairment loss is based on the fair value of the asset as provided by third parties. In this respect, management regularly reviews the carrying amount of the vessels in connection with the estimated recoverable amount for each of the Company's vessels. We did not recognize a vessel impairment charge for the years ended December 31, 2018 and 2017. For the year ended December 31, 2016 we recognized impairment charges of $129.0 million. Refer to Note 4 Vessels and vessel improvements for further discussion.
Under voyage charters, voyage revenues for cargo transportation are recognized ratably over the estimated relative transit time of each voyage. Voyage revenue is deemed to commence upon the loading of the charterer’s cargo and is deemed to end upon the completion of discharge, provided an agreed non-cancellable charter between the Company and the charterer is in existence, the charter rate is fixed and determinable, and collectability is reasonably assured. Revenue under voyage charters will not be recognized until a charter has been agreed even if the vessel has discharged its previous cargo and is proceeding to an anticipated port of loading. Under voyage charters, voyage expenses such as bunkers, port charges, canal tolls, cargo handling operations and brokerage commissions are paid by the Company whereas, under time charters, such voyage costs are paid by the Company's customers. Vessel operating costs include crewing, vessel maintenance and vessel insurance. All voyage and vessel operating expenses are expensed as incurred on an accrual basis, except for commissions. Commissions are recognized over the related time or voyage charter period since commissions are earned as the Company's revenues are earned. Probable losses on voyages are provided for in full at the time such loss can be estimated. We adopted ASC 606 as of January 1, 2018 utilizing the modified retrospective method of transition. We recorded an adjustment of approximately $0.8 million to increase our opening accumulated deficit and increase our unearned revenue and other current assets on our Consolidated Balance Sheet on January 1, 2018.
Impact of Recently Adopted Accounting Standards Revenue recognition Time charters Our shipping revenues are principally generated from time charters and voyage charters. In a time charter contract, the vessel is hired by the charterer for a specified period of time in exchange for consideration which is based on a daily hire rate. The charterer has the full discretion over the ports visited, shipping routes and vessel speed. The contract/charter party generally provides typical warranties regarding the speed and performance of the vessel. The charter party generally has some owner protective restrictions such that the vessel is sent only to safe ports by the charterer, subject always to compliance with applicable sanction laws, and carry only lawful or non hazardous cargo. In a time charter contract, the Company is responsible for all the costs incurred for running the vessel such as crew costs, vessel insurance, repairs and maintenance and lubes. The charterer bears the voyage related costs such as bunker expenses, port charges and canal tolls during the hire period. The performance obligations in a time charter contract are satisfied over the term of the contract beginning when the vessel is delivered to the charterer until it is redelivered back to the Company. The charterer generally pays the charter hire in advance of the upcoming contract period. The time charter contracts are considered operating leases and therefore do not fall under the scope of ASC 606 because (i) the vessel is an identifiable asset (ii) the Company does not have substantive substitution rights and (iii) the charterer has the right to control the use of the vessel during the term of the contract and derives the economic benefits from such use. Voyage charters In a voyage charter contract, the charterer hires the vessel to transport a specific agreed-upon cargo for a single voyage which may contain multiple load ports and discharge ports. The consideration in such a contract is determined on the basis of a freight rate per metric ton of cargo carried or occasionally on a lump sum basis. The charter party generally has a minimum amount of cargo. The charterer is liable for any short loading of cargo or "dead" freight. The voyage contract generally has standard payment terms of 95% freight paid within three days after completion of loading. The voyage charter party generally has a "demurrage" or "despatch" clause. As per this clause, the charterer reimburses the Company for any potential delays exceeding the allowed laytime as per the charter party clause at the ports visited which is recorded as demurrage revenue. Conversely, the charterer is given credit if the loading/discharging activities happen within the allowed laytime known as despatch resulting in a reduction in revenue. In a voyage charter contract, the performance obligations begin to be satisfied once the vessel begins loading the cargo. The Company determined that its voyage charter contracts consist of a single performance obligation of transporting the cargo within a specified time period. Therefore, the performance obligation is met evenly as the voyage progresses. and the revenue is recognized on a straight line basis over the voyage days from the commencement of the loading of cargo to completion of discharge. The voyage contracts are considered service contracts which fall under the provisions of ASC 606 because the Company as the shipowner retains the control over the operations of the vessel such as directing the routes taken or the vessel speed. The voyage contracts generally have variable consideration in the form of demurrage or despatch. The amount of revenue earned as demurrage or despatch paid by the Company for the year ended December 31, 2018 is not material. The following table shows the revenues earned from time charters and voyage charters for the year ended December 31, 2018:
Contract costs In a voyage charter contract, the Company bears all voyage related costs such as fuel costs, port charges and canal tolls. These costs are considered contract fulfillment costs because the costs are direct costs related to the performance of the contract and are expected to be recovered. The costs incurred during the period prior to commencement of loading the cargo, primarily bunkers, are deferred as they represent setup costs and recorded as a current asset and are amortized on a straight-line basis as the related performance obligations are satisfied. We adopted the provisions of ASC 606 on January 1, 2018 using the modified retrospective approach. As such, the comparative information has not been restated and continues to be reported under the accounting standards in effect for periods prior to January 1, 2018. Under the modified retrospective approach, the Company recognized the cumulative effect of adopting this standard as an adjustment amounting to $0.8 million to increase the opening balance of Accumulated Deficit as of January 1, 2018. The Company recognized $0.8 million of deferred costs which represents the costs, such as bunker expenses and charter hire expenses on chartered-in vessels, incurred prior to commencement of loading which are recorded in other current assets and $1.6 million of unearned charter hire revenue which represents the Company's obligation to satisfy performance obligations under the contract for which the Company has received consideration from the customer. The adoption of ASC 606 impacted the timing of recognition of revenue for certain ongoing spot voyage charter contracts, related voyage expenses and charter hire expenses. Under ASC 606, revenue is recognized from when the vessel commences loading through the completion of discharge at the discharge port instead of recognizing revenue from the discharge of the previous voyage provided an agreed non-cancellable charter between the Company and the charterer is in existence, the charter rate is fixed and determinable, and collectability is reasonably assured. Any expenses incurred during the ballast portion of the voyage (time spent by the vessel traveling from discharge port of the previous voyage to the load port of the subsequent voyage) such as bunker expenses, canal tolls and charter hire expenses for chartered-in vessels are deferred and are recognized on a straight-line basis over the charter period as the Company satisfies the performance obligations under the contract. Further, the adoption of ASC 606 impacted the accounts receivable and unearned revenue on our Consolidated Balance Sheet as of December 31, 2018. Under ASC 606, receivables represent an entity's unconditional right to consideration, billed or unbilled. The Company determined that the performance obligations on its spot voyage charters do not begin to be satisfied unless the vessel arrives at the load port and commences loading the cargo. This impacted the amount of accounts receivable and unearned revenue recorded in our Consolidated Balance Sheet. The following table presents the impact of the adoption of ASC 606 on our Consolidated Balance Sheet at December 31, 2018:
The following table presents the impact of the adoption of ASC 606 on our Consolidated Statement of Operations:
The cumulative effect of changes made to our opening Consolidated Balance Sheet on January 1, 2018 for the adoption of ASC 606:
(1) Under ASC 606, the contract fulfillment costs are deferred as a current asset and amortized as the related performance obligations are satisfied. The adjustment to other current assets includes bunker expenses of $0.6 million incurred to arrive at the load port for the voyages in progress as of January 1, 2018 and $0.2 million of charter hire expenses on third party chartered-in vessels which were chartered-in to fulfill the performance obligations under the voyage contract. (2) Under ASC 606, unearned charter hire revenue represents the consideration received for undelivered performance obligations. The Company recorded $0.7 million as unearned revenue on voyages in progress as of January 1, 2018. The Company recognized this revenue in the first quarter of 2018 as the performance obligations were met. The adoption of ASC 606 had no impact on net cash provided by operating activities, investing activities and financing activities for the year ended December 31, 2018. Cash, cash equivalents and restricted cash In November 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-18. The amendments in Accounting Standard Update ("ASU") 2016-18 require that a statement of cash flows explain the change during the year in the total of cash, cash equivalents, and amounts described as restricted cash and restricted cash equivalents. Therefore, the restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-year and end-of-year total amounts shown on the statement of cash flows. We adopted this accounting standard as of January 1, 2018 and $11.0 million of restricted cash has been aggregated with the cash and cash equivalents as of December 31, 2018. Additionally, we retrospectively aggregated $74,917 of restricted cash with cash and cash equivalents in both the beginning-of-year and end-of-year line items at the bottom of the statements of cash flows for the years ended December 31, 2017 and 2016. Statement of cash flows (Topic 230) - classification of certain cash receipts and cash payments In August 2016, the FASB issued Accounting Standards Update No. 2016-15, “Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments” ("ASU-2016-15"). The new guidance is intended to provide specific guidance on cash flow classification issues such as debt prepayment or debt extinguishment costs, settlement of zero coupon debt instruments or cases where the coupon interest rate is insignificant compared to the effective interest rate of the borrowing, contingent consideration payments in a business combination, proceeds from insurance claim settlements and distributions received by equity method investees. The standard is effective for annual periods beginning after December 15, 2017 and interim periods within those annual periods. The amendment was applied retrospectively to each period presented and the Company reclassified $17.4 million of accumulated payment-in-kind interest paid upon the discharge of the Second Lien Facility (defined herein) in 2017 previously recorded as a use of cash from financing activities, as a use of cash from operating activities. In May 2017, the FASB issued ASU No. 2017-09, Compensation-Stock Compensation ("ASU 2017-09"), which provides guidance about what changes to the terms and conditions of a stock award require an entity to apply modification accounting as per ASC 718. An entity should account for effects of modification unless (i) the fair value of the modified award is the same as the fair value of the original award (ii) the vesting conditions of the modified award are the same as the vesting conditions of the original award and (iii) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award. The standard is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2017. There was no impact on the Company's consolidated financial statements upon adoption of this accounting standard. In January 2017, the FASB issued Accounting Standards Update No. 2017-1, “Business Combinations (Topic 805).” The amendments in this update are intended to clarify the definition of business. The current guidance specifies three elements of a business – inputs, processes, and outputs. The new guidance provides a screen to determine when a set (defined as an integrated set of assets and activities) is not a business. The ASU requires that, to be a business, the set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. The screen requires that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. The standard is effective to annual periods beginning after December 15, 2017, including interim periods within those periods. As of December 31, 2018, there was no impact on the Company's consolidated financial statements upon adoption of this accounting standard as the Company had no business combination transaction in 2018. Accounting Standards issued but not yet adopted. The FASB has issued accounting standards that had not yet become effective as of December 31, 2018 and may impact the Company’s consolidated financial statements or related disclosures in future periods. Those standards and their potential impact are discussed below. Accounting standards effective in 2019 In February 2016, the FASB issued ASU No. 2016-02, "Leases ( Topic 842)," as amended ("ASU No. 2016-02"), which revises the accounting for leases. Under the new guidance, lessees are required to recognize a right-of-use asset and a lease liability for substantially all leases. The new guidance will continue to classify leases as either financing or operating, with classification affecting the pattern of expense recognition. The accounting applied by a lessor under the new guidance will be substantially equivalent to current lease accounting guidance. Entities have the option to adopt the new guidance using a modified retrospective approach through an adjustment to retained earnings applied either to the beginning of the earliest period presented or the beginning of the period of adoption. The new guidance was effective January 1, 2019 and will be applied using a modified retrospective approach through a cumulative effect adjustment to retained earnings as of January 1, 2019. The most significant effects of adoption relate to the recognition of right-of-use assets and lease liabilities on our balance sheet for operating leases and providing new disclosures about our leasing activities. We currently expect the right-of-use assets and lease liabilities as of January 1, 2019 to range from $27.0 million to $35.0 million based on the present value of the Company’s remaining minimum lease payments, primarily due to the recognition of right of use assets and lease liabilities with respect to operating leases. We do not believe the adoption of ASC 842 will have a material effect on our consolidated results of operations or cash flows. The Company will provide the required disclosures under the standard in its Form 10-Q filing for the quarterly period ending March 31, 2019. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging ("ASU-2017-12"), which is intended to align the results of the cash flow and fair value hedge accounting with the risk management activities of an entity. The amendments expand the hedge accounting for both financial and non-financial risk components and they reduce the operational burden of applying hedge accounting. The amendment enables the financial statements to reflect accurately the intent and outcome of its hedging strategies. ASU 2017-12 requires a modified retrospective transition method in which the Company will recognize the cumulative effect of the change on the opening balance of each affected component of equity in the consolidated balance sheet as of the date of adoption. The Standard is effective for fiscal years beginning after December 15, 2018, and interim periods with those fiscal years. The Company currently is not expecting any material impact as a result of adoption of this accounting standard on its consolidated financial statements as we do not apply hedge accounting of our freight forward agreements and bunker swaps. In July 2017, the FASB issued ASU No. 2017-11, "Earnings Per Share, Distinguishing Liabilities from Equity, and Derivatives and Hedging" ("ASU No. 2017-11"), which changes the classification of certain equity-linked financial instruments with down round features. As a result, a free standing equity-linked financial instrument or an embedded conversion option would not be accounted for as a derivative liability at fair value as a result of existence of a down round feature. For freestanding equity classified financial instruments, the amendment requires the entities to recognize the effect of the down round feature when triggered in its earnings per share calculations. The standard is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently not expecting any material impact as a result of adoption of this accounting standard on its consolidated financial statements as we have not elected to apply hedge accounting related to our freight forward agreements and bunker swaps. Accounting standards effective in 2020 In August 2018, the FASB issued ASU No. 2018-13, Fair value measurement ( "ASU 2018-13"). ASU 2018-13 is intended to streamline the disclosures requirements on fair value measurements. Disclosures such as the amounts of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the valuation process for Level 3 fair value measurements were removed. Additional disclosures such as disclosure about changes in unrealized gains and losses included in the other comprehensive income for Level 3 fair value measurements, the range and weighted average of significant unobservable inputs used for Level 3 fair value measurements are required to be reported by the public entities. The amendment is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company is currently evaluating the impact of the adoption of the accounting standard on its consolidated financial statements. |
Vessels and vessel improvements |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vessels and vessel improvements | Vessels and vessel improvements As of December 31, 2018, the Company’s owned fleet consisted of 47 drybulk vessels. As of December 31, 2015, the Company identified six vessels which it was probable that the Company was going to sell, and recognized an impairment charge in 2015 of $50.9 million. The carrying value of these vessels prior to impairment in 2015 was $76.3 million. As the value of such vessels further declined in the first quarter of 2016, the Company recorded an additional impairment charge of $6.2 million in that quarter. Out of the six vessels initially identified in 2015, all vessels have been sold as of December 31, 2017. As of December 31, 2016, as part of the Company's fleet renewal program, management considered it probable that we would divest of some of our older vessels as well as certain less efficient vessels from our fleet to achieve operating cost savings within two years. Management's strategy also entailed moving to larger Ultramax vessels as the Company renews its fleet. As a result, the Company recognized an additional impairment charge of $122.9 million in the fourth quarter of 2016. The carrying value of these vessels prior to impairment was $234.9 million. The Company sold four of the sixteen impaired vessels in 2017 and 2018 and signed memorandum of agreements for the sale of two additional vessels as of December 31, 2018. The two vessels were delivered to the buyers in January 2019. For the year ended December 31, 2018, the Company purchased and took delivery of two modern Ultramax vessels for $21.3 million per vessel. For the year ended December 31, 2018, the Company sold two vessels (Avocet, and Thrush) for total net proceeds of $20.5 million after brokerage commissions and associated selling expenses. The Company recorded a net gain of $0.3 million from the sale of the two vessels. The Company recorded the proceeds from the sale of the vessel Thrush as restricted cash at December 31, 2018 pursuant to the Bond Terms governing the Norwegian Bond Debt. Please refer to Note 8 Debt to the consolidated financial statements. On December 13, 2018, the Company signed a memorandum of agreement to sell the vessel Condor for $6.5 million after brokerage commissions and associated selling expenses. The vessel was delivered to buyers in the first quarter of 2019. The Company expects to recognize a gain of $2.2 million. The Company recorded the carrying amount of the vessel as vessels held for sale in its Consolidated Balance Sheet as of December 31, 2018. On December 21, 2018, the Company signed a memorandum of agreement to purchase a 2015 built Ultramax vessel for $20.4 million. As of December 31, 2018, the Company paid a deposit of $2.0 million. The Company took delivery of the vessel in the first quarter of 2019. On January 4, 2019, the Company signed a memorandum of agreement to sell the vessel Merlin for $6.1 million after brokerage commissions and associated selling expenses. The vessel was delivered to the buyers in January 2019. The Company expects to record a gain of approximately $1.9 million in the first quarter of 2019. The Company recorded the carrying amount of the vessel as vessels held for sale in its Consolidated Balance Sheet as of December 31, 2018 On August 14, 2018, the Company entered into a contract for installation of ballast water treatment systems ("BWTS") on 47 of our owned vessels. The projected costs, including installation, is approximately $0.5 million per BWTS. The Company intends to complete the installation during scheduled drydockings. The Company recorded $1.0 million in Other assets as of December 31, 2018. On September 4, 2018, the Company announced it had entered into a series of agreements to purchase up to 37 Scrubbers which are to be retrofitted on owned vessels. The Agreements are comprised of firm orders for 19 Scrubbers and up to an additional 18 units, at the Company’s option. On November 20, 2018, the Company announced that it had exercised its option to purchase 15 of the 18 optional Scrubbers, and on January 23, 2019, the Company announced that it had exercised the remaining 3 options. The projected costs, including installation, is approximately $2.2 million per Scrubber. The Company recorded $16.9 million in Other assets in its Consolidated Balance Sheet as of December 31, 2018.
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Short-term investment |
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Investments, Debt and Equity Securities [Abstract] | |
Short-term investment | Short-term investment As of December 31, 2017, the Company held a certificate of deposit of $4.5 million, with an original maturity at the date of purchase of one year. It was classified as Level 2 security in the fair value hierarchy. The certificate of deposit matured in the first quarter of 2018. |
Deferred Drydock Costs |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Drydock Costs | Deferred Drydock Costs Drydocking activity is summarized as follows:
* The Company wrote off drydock expenses of $0.5 million relating to the sale of vessels Avocet and Thrush, which was recorded in (gain)/loss on sale of vessels in the Consolidated Statement of Operations for the year ended December 31, 2018. |
Other accrued liabilities |
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Other Liabilities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other accrued liabilities | Other accrued liabilities Other accrued liabilities consist of:
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Long-term debt consists of the following:
*Includes loan balances on term loan and revolver loan facility under the New First Lien Facility as of December 31, 2017. The revolver loan of $5.0 million was repaid during 2018. Norwegian Bond Debt On November 28, 2017, Eagle Bulk Shipco LLC, a wholly-owned subsidiary of the Company ("Shipco" or "Issuer") issued $200.0 million in aggregate principal amount of 8.250% Senior Secured Bonds (the "Bonds" or the "Norwegian Bond Debt"), pursuant to those certain bond terms (the "Bond Terms"), dated as of November 22, 2017, by and between the Issuer and Nordic Trustee AS, as the Bond Trustee. After giving effect to an original issue discount of approximately 1% and deducting offering expenses of $3.1 million, the net proceeds from the issuance of the Bonds are approximately $195.0 million. These net proceeds from the Bonds, together with the proceeds from the New First Lien Facility and cash on hand, were used to repay all amounts outstanding including accrued interest under various debt facilities outstanding at that time and to pay expenses associated with the refinancing transactions. Shipco incurred $1.3 million in other financing costs in connection with the transaction. The Norwegian Bond Debt is guaranteed by the limited liability companies that are subsidiaries of the Issuer and the legal and beneficial owners of 27 security vessels (the "Shipco Vessels") in the Company’s fleet, and will be secured by mortgages over such security vessels, a pledge granted by the Company over all of the shares of the Issuer, a pledge granted by the Issuer over all the shares in the Vessel Owners, certain charter contract assignments, certain assignments of earnings, a pledge over certain accounts, an assignment of insurances covering security vessels, and assignments of intra-group debt between the Company and the Issuer or its subsidiaries. Pursuant to the Bond Terms, interest on the Bonds will accrue at a rate of 8.250% per annum on the nominal amount of each of the Bonds from November 28, 2017, payable semi-annually on May 29 and November 29 of each year (each, an “Interest Payment Date”), commencing May 29, 2018. The Bonds will mature on November 28, 2022. On each Interest Payment Date from and including November 29, 2018, the Issuer must repay an amount of $4.0 million, plus accrued interest thereon. Any outstanding Bonds must be repaid in full on the Maturity Date at a price equal to 100% of the nominal amount, plus accrued interest thereon. The Issuer may redeem some or all of the outstanding Bonds at any time on or after the Interest Payment Date in May 2020 (the “First Call Date”), at the following redemption prices (expressed as a percentage of the nominal amount), plus accrued interest on the redeemed amount, on any business day from and including:
Prior to the First Call Date, the Issuer may redeem some or all of the outstanding Bonds at a price equal to 100% of the nominal amount of the Bonds plus a “make-whole” premium and accrued and unpaid interest to the redemption date. If the Company experiences a change of control, each holder of the Bonds will have the right to require that the Issuer purchase all or some of the Bonds held by such holder at a price equal to 101% of the nominal amount, plus accrued interest. The Bond Terms contain certain financial covenants that the Issuer’s leverage ratio defined as the ratio of outstanding bond amount and any drawn amounts under the Super Senior Facility less consolidated cash balance to the aggregate book value of the Shipco Vessels must not exceed 75% and its and its subsidiaries’ free liquidity must at all times be at least $12.5 million. The Company is in compliance with its financial covenants as of December 31, 2018. On March 23, 2018, the Company signed a memorandum of agreement to sell the vessel Thrush for $10.8 million after brokerage commissions and associated selling expenses. Pursuant to the Bond Terms governing the Norwegian Bond Debt, the proceeds from the sale of vessels are to be held in a restricted account to be used for the financing of the acquisition of additional vessels by Shipco. As a result, the Company recorded the proceeds of the sale of Thrush as restricted cash at December 31, 2018 in the consolidated financial statements. On November 6, 2018, the Company received the approval for an amendment to the Bond Terms to allow for the proceeds from the sale of the Shipco vessels for partial financing of Scrubbers to be retrofitted to the Shipco vessels. As of December 31, 2018, the Company did not use any of the proceeds received from sale of Shipco vessels for financing of Scrubbers. The Bond Terms also contain certain events of default customary for transactions of this type, including, but not limited to, those relating to: a failure to pay principal or interest; a breach of covenants, representation or warranty; a cross default to other indebtedness; the occurrence of certain bankruptcy and insolvency events; and the impossibility or unlawfulness of performance of the finance documents. The Bond terms also contain certain exceptions and qualifications, among other things, limit the Company’s and the Issuer’s ability and the ability of the Issuer’s subsidiaries to do the following: make distributions; carry out any merger, other business combination, demerger or corporate reorganization; make substantial changes to the general nature of their respective businesses; incur certain indebtedness; incur liens; make loans or guarantees; make certain investments; transact with affiliates; enter into sale and leaseback transactions; engage in certain chartering-in of vessels; dispose of shares of Vessel Owners; or acquire the Bonds. The Bonds were listed for trading on the Oslo Stock Exchange on May 15, 2018. New First Lien Facility On December 8, 2017, Eagle Shipping entered into the New First Lien Facility, which provided for (i) a term loan facility in an aggregate principal amount of up to $60.0 million (the “Term Loan”) and (ii) a revolving credit facility in an aggregate principal amount of up to $5.0 million (the “Revolving Loan”). Outstanding borrowings under the New First Lien Facility bore interest at LIBOR plus 3.50% per annum. Eagle Shipping paid $1.0 million to the lenders and incurred $0.4 million of other financing costs in connection with the transaction. The New First Lien Facility had a maturity date on the earlier of (i) five years from the initial borrowing date under the Credit Agreement and (ii) December 8, 2022. With respect to the Term Loan, Eagle Shipping was required to make quarterly repayments of principal of $2.15 million beginning January 15, 2019, with a final balloon payment to be made at maturity. With respect to the Revolving Loan, Eagle Shipping was required to repay the aggregate principal amount of all borrowings outstanding on the maturity date. Accrued interest on amounts outstanding under the Term Loan and the Revolving Loan was required be paid on the last day of each applicable interest period. Interest periods were for three months, six months or any other period agreed between Eagle Shipping and the Lenders. Finally, Eagle Shipping was required to prepay certain specified amounts outstanding under the New First Lien Facility if an Eagle Shipping Vessel (as defined below) was sold or became a total loss or if there was a change of control with respect to the Company, Eagle Shipping or any Guarantor. Eagle Shipping’s obligations under the New First Lien Facility was secured by, among other items, a first priority mortgage on the nine vessels in Eagle Shipping’s fleet as identified in the Credit Agreement and such other vessels that it may from time to time include with the approval of the Lenders (the “Eagle Shipping Vessels”), an assignment of certain accounts, an assignment of certain charters with terms that may exceed 12 months, an assignment of insurances, an assignment of certain master agreements, and a pledge of the membership interests of each of Eagle Shipping’s vessel-owning subsidiaries. In the future, Eagle Shipping may grant additional security to the Lenders from time to time. The New First Lien Facility contained financial covenants requiring Eagle Shipping to maintain minimum liquidity of $0.5 million in respect of each Eagle Shipping Vessel and to maintain a consolidated interest coverage ratio beginning for the fiscal quarter ending on September 30, 2019, of not less than a range varying from 1.50 to 1.00 to 2.50 to 1.00. In addition, the New First Lien Facility also imposed operating restrictions on Eagle Shipping and the Guarantors, including limiting Eagle Shipping’s and the Guarantors’ ability to, among other things: pay dividends; incur additional indebtedness; create liens on assets; sell assets; dissolve or liquidate; merge or consolidate with another person; make investments; engage in transactions with affiliates; and allow certain changes of control to occur. The Company was in compliance with its financial covenants as of December 31, 2018. The New First Lien Facility also included customary events of default, including those relating to: a failure to pay principal or interest; a breach of covenant, representation or warranty; a cross-default to other indebtedness; the occurrence of certain bankruptcy and insolvency events; the occurrence of certain ERISA events; a judgment default; the cessation of business; the impossibility or unlawfulness of performance of the loan documents; the ineffectiveness of any material provision of any loan document; the occurrence of a material adverse effect; and the occurrence of certain swap terminations. During the first quarter of 2018, Eagle Shipping repaid $5.0 million of the Revolving Loan. As of December 31, 2018, the availability under the Revolving Loan was $5.0 million. On January 25, 2019, the Company repaid the outstanding debt under the New First Lien Facility in full as part of the refinancing transaction as described below under "Refinancing." Super Senior Facility On December 8, 2017, Shipco entered into the Super Senior Facility, which provides for a revolving credit facility in an aggregate amount of up to $15.0 million. The proceeds of the Super Senior Facility, which are currently undrawn, are expected, pursuant to the terms of the Super Senior Facility, to be used (i) to acquire additional vessels or vessel owners and (ii) for general corporate and working capital purposes of Shipco and its subsidiaries. The Super Senior Facility matures on August 28, 2022. Shipco paid $0.3 million as other financing costs in connection with the transaction. As of December 31, 2018, the availability under the Super Senior Facility is $15.0 million. The outstanding borrowings under the Super Senior Facility will bear interest at LIBOR plus 2.00% per annum and commitment fees of 40% of the applicable margin on the undrawn portion of the facility. For each loan that is requested under the Super Senior Facility, Shipco must repay such loan along with accrued interest on the last day of each interest period relating to the loan. Interest periods are for three months, six months or any other period agreed between Shipco and the Super Senior Facility Agent. Additionally, subject to the other terms of the Super Senior Facility, amounts repaid on the last day of each interest period may be re-borrowed. Shipco’s obligations under the Super Senior Facility are guaranteed by the limited liability companies that are subsidiaries of Shipco and the legal and beneficial owners of 27 vessels in the Company’s fleet (the “Eagle Shipco Vessel Owners”), and will be secured by mortgages over such vessels, a pledge granted by the Company over all of the shares of Shipco, a pledge granted by Shipco over all the shares in the Eagle Shipco Vessel Owners, certain charter contract assignments, certain assignments of earnings, a pledge over certain accounts, an assignment of insurances covering security vessels, and assignments of intra-group debt between the Company and Shipco or its subsidiaries. The Super Senior Facility ranks super senior to the Bonds with respect to any proceeds from any enforcement action relating to security or guarantees for both the Super Senior Facility and the Bonds. The Super Senior Facility contains certain covenants that, subject to certain exceptions and qualifications, among other things, limit Shipco’s and its subsidiaries’ ability to do the following: make distributions; carry out any merger, other business combination, or corporate reorganization; make substantial changes to the general nature of their respective businesses; incur certain indebtedness; incur liens; make loans or guarantees; make certain investments; transact other than on arm’s-length terms; enter into sale and leaseback transactions; engage in certain chartering-in of vessels; or dispose of shares of Eagle Shipco Vessel Owners. Additionally, Shipco’s leverage ratio must not exceed 75% and its and its subsidiaries’ free liquidity must at all times be at least $12.5 million. Also, the total commitments under the Super Senior Facility will be cancelled if (i) at any time the aggregate market value of the security vessels for the Super Senior Facility is less than 300% of the total commitments under the Super Senior Facility or (ii) if Shipco or any of its subsidiaries redeems or otherwise repays the Bonds so that less than $100.0 million is outstanding under the Bond Terms. The Company is in compliance with its financial covenants as of December 31, 2018. The Super Senior Facility also contains certain events of default customary for transactions of this type, including, but not limited to, those relating to: a failure to pay principal or interest; a breach of covenants, representation or warranty; a cross default to other indebtedness; the occurrence of certain bankruptcy and insolvency events; the cessation of business; the impossibility or unlawfulness of performance of the finance documents for the Super Senior Facility; and the occurrence of a material adverse effect. Original Ultraco Debt Facility On June 28, 2017, Ultraco, a wholly-owned subsidiary of the Company, entered into a credit agreement (the “Original Ultraco Debt Facility”), by and among Ultraco, as borrower, certain wholly-owned vessel-owning subsidiaries of Ultraco, as guarantors (the “Ultraco Guarantors”). The Original Ultraco Debt Facility provided for a multi-draw senior secured term loan facility in an aggregate principal amount of up to the lesser of (i) $61.2 million and (ii) 40% of the lesser of (1) the purchase price of the nine Ultramax vessels to be acquired by Ultraco and the Ultraco Guarantors pursuant to a previously disclosed framework agreement, dated as of February 28, 2017, with Greenship Bulk Manager Pte. Ltd., as Trustee-Manager of Greenship Bulk Trust, and (2) the fair market value of the vessels. The proceeds of the Original Ultraco Debt Facility were used for the purpose of financing, refinancing or reimbursing a part of the acquisition cost of nine Ultramax vessels. The outstanding borrowings under the Original Ultraco Debt Facility bore interest at LIBOR plus 2.95% per annum. The Original Ultraco Debt Facility also provided for the payment of certain other fees and expenses by Ultraco. Ultraco paid $1.0 million to the lenders and $0.5 million as deferred financing costs in connection with the transaction. On December 29, 2017, Ultraco entered into a First Amendment (the “First Amendment”) to the Original Ultraco Debt Facility to increase the commitments for the purpose of financing the acquisition of an additional vessel by New London Eagle LLC, a wholly owned subsidiary of Ultraco and additional guarantor under the Original Ultraco Debt Facility. The increase in the commitments was $8.6 million. Ultraco took delivery of the vessel in January 2018 and drew down $8.6 million. The Company paid $0.1 million as financing costs to the lender in connection with the transaction. On October 17, 2018, Ultraco entered into a Second Amendment (the "Second Amendment") to the Original Ultraco Debt Facility to increase the commitments for the purpose of financing the acquisition of an additional vessel by Hamburg Eagle LLC, a wholly owned subsidiary of Ultraco and additional guarantor under the Original Ultraco Debt Facility. The increase in the commitments was $12.8 million. Ultraco took delivery of the vessel on October 22, 2018 and drew down $12.8 million. The Company paid $0.2 million as financing costs to the lender in connection with the transaction. As of December 31, 2018, Ultraco has drawn $82.6 million of the credit facility relating to the acquisition of 11 Ultramax vessels. The Original Ultraco Debt Facility was to mature on the earlier of (i) five years after the delivery of the last remaining Greenship Vessel to occur and (ii) October 31, 2022. There were no fixed repayments until January 2019 (the "First Repayment Date"). Ultraco was required to make quarterly repayments of principal in an amount of $2.1 million beginning in the first quarter of 2019 with a final balloon payment to be made at maturity. The Original Ultraco Debt Facility allowed for increased commitments, subject to the satisfaction of certain conditions and the obtaining of certain approvals, in an aggregate principal amount of up to the lesser of (i) $17.4 million and (ii) 40% of the aggregate fair market value of any additional vessels to be financed with such incremental commitment. Ultraco’s obligations under the Original Ultraco Debt Facility were secured by, among other items, a first priority mortgage on each of the Greenship Vessels and such other vessels that it may from time to time include with the approval of the Ultraco Lenders, an assignment of earnings of the Greenship Vessels, an assignment of all charters with terms that may exceed 12 months, an assignment of insurances, an assignment of certain master agreements, and a pledge of the membership interests of each of Ultraco’s vessel-owning subsidiaries. The Original Ultraco Debt Facility contained financial covenants requiring Ultraco, among other things: (1) to ensure that the aggregate market value of the Greenship Vessels (plus the value of certain additional collateral) was at all times not less than 150% of the aggregate principal amount of debt outstanding (subject to certain adjustments); (2) to maintain cash or cash equivalents not less than (a) a liquidity reserve of $0.6 million in respect of each Greenship Vessel and (b) a debt service reserve of $0.6 million in respect of each Greenship Vessel, a portion of which could have been utilized to satisfy the obligations under the Original Ultraco Debt Facility upon satisfaction of certain conditions; however, taking into account the requirements of 2(a) and 2(b), the cash or cash equivalents could not have been less than the greater of (i) $7.5 million or (ii) 12% of the consolidated total debt of Ultraco and its subsidiaries; (3) to maintain at all times a ratio of consolidated tangible net worth to consolidated total assets of not less than 0.35 to 1.00; (4) to maintain a consolidated interest coverage ratio beginning after the second anniversary of June 28, 2017, of not less than a range varying from 2.00 to 1.00 to 2.50 to 1.00; and (5) to maintain a ballast water treatment systems reserve of $4.6 million which may be released upon the satisfaction of certain conditions. In addition, the Original Ultraco Debt Facility also imposed operating restrictions on Ultraco and the Ultraco Guarantors, including limiting Ultraco’s and the Ultraco Guarantors’ ability to, among other things: pay dividends; incur additional indebtedness; create liens on assets; sell assets; dissolve or liquidate; merge or consolidate with another person; make investments; engage in transactions with affiliates; and allow certain changes of control to occur. The Original Ultraco Debt Facility also included customary events of default, including those relating to: a failure to pay principal or interest; a breach of covenant, representation or warranty; a cross-default to other indebtedness; the occurrence of certain bankruptcy and insolvency events; the occurrence of certain ERISA events; a judgment default; the cessation of business; the impossibility or unlawfulness of performance of the loan documents; the ineffectiveness of any material provision of any loan document; the occurrence of a material adverse effect; and the occurrence of certain swap terminations. On January 25, 2019, the Company repaid the outstanding debt under the Original Ultraco Debt Facility in full as part of the refinancing transaction as described below). Interest rates For the year ended December 31, 2018, interest rates on Norwegian Bond Debt was 8.25%. The weighted average effective interest rate including amortization of debt discount and debt issuance costs for the year was 8.91%. The interest rates on the Original Ultraco Debt Facility ranged from 4.64% to 5.76% including a margin over LIBOR and commitment fees of 40% of the margin on the undrawn portion of the facility. The weighted average effective interest rate for the year was 5.58%. The interest rates on the New First Lien Facility ranged from 4.91% to 5.89% including a margin over LIBOR and commitment fees of 40% of the margin on the undrawn portion of the revolver credit facility of the New First Lien Facility. The weighted average effective interest rate including the amortization of debt discount and debt issuance costs for the year was 6.12%. For the year ended December 31, 2017, interest rates on our outstanding debt under the First Lien Facility ranged from 4.77% to 5.35%, including a margin over LIBOR and commitment fees of 40% of the margin on the undrawn portion of the facility. The weighted average effective interest rate was 6.18%. The interest rates on our outstanding debt under the Original Ultraco Debt Facility ranged from 4.19% to 4.28%, including a margin over LIBOR applicable under the terms of the Original Ultraco Debt Facility which was entered into on June 28, 2017. The weighted average effective interest rate was 4.71%. The Norwegian Bond debt carries an interest rate of 8.25%. The weighted average effective interest rate on the same was 8.84%. The interest rate on our outstanding debt under the New First Lien Facility was 4.83% including a margin over LIBOR applicable under the terms of the New First Lien Facility which was entered into on December 8, 2017. The weighted average effective interest rate was 5.21%. For 2016, interest rates on our outstanding debt ranged from 3.86% to 4.99%, including a margin over LIBOR applicable under the terms of the First Lien Facility/Exit Financing Facility. The weighted average effective interest rate including the amortization of debt discount for this period was 6.83%. For 2017 and 2016, the payment-in-kind interest rate on our Second Lien Facility was 15% including a margin over LIBOR. The weighted average effective interest rate on our Second Lien Facility including the amortization of debt discount was 17.05%. Interest Expense consisted of:
* The Exit Financing Facility was amended and restated on March 30, 2016 as a result of entering into the First Lien Facility. First Lien Facility On March 30, 2016, Eagle Shipping as borrower, and certain of its subsidiaries that were guarantors of the Company’s obligations under the Company’s senior secured credit facility (the “Exit Financing Facility”), as guarantors, entered into the “First Lien Facility with the lenders thereunder (the “First Lien Lenders”) and ABN AMRO Capital USA LLC, as agent and security trustee for the lenders. The First Lien Facility amended and restated the Exit Financing Facility in its entirety, provided for Eagle Shipping to be the borrower in the place of the Company, and further provided for a waiver of any and all events of default occurring as a result of the voluntary OFAC Disclosure referred to in Note 10. Commitments and Contingencies - Legal Proceedings to the consolidated financial statements. The First Lien Facility provided for a term loan in the amount of $201.5 million after giving effect to the entry into the First Lien Facility and the Second Lien Facility as well as a $50.0 million revolving credit facility (the "First Lien Facility"). The outstanding borrowings under the First Lien Facility bore interest at LIBOR plus 4.0% per annum. Eagle Shipping prepaid $5.7 million of the term loan during the year ended December 31, 2016 and $13.0 million of the term loan for the year ended December 31, 2017 pursuant to the terms of the First Lien Facility relating to mandatory prepayments upon sales of vessels. Additionally, Eagle Shipping also repaid $5.0 million of the revolving credit facility in the third quarter of 2017. On December 8, 2017, Eagle Shipping repaid the outstanding balance of the term loan of $171.1 million and the outstanding balance of the revolver loan of $20.0 million and discharged the debt under the First Lien Facility in full. As a result, Eagle Shipping recorded a loss, representing the difference between settlement price and the net carrying value of the debt amounting to $3.2 million which is included in loss on debt extinguishment in the Consolidated Statement of Operations for the year ended December 31, 2017. Second Lien Facility On March 30, 2016, Eagle Shipping, as borrower, and certain of its subsidiaries that were guarantors of the Company’s obligations under the Exit Financing Facility, as guarantors, entered into a Second Lien Facility with certain lenders (the “Second Lien Lenders”) and Wilmington Savings Fund Society, FSB as agent for the Second Lien Lenders (the “Second Lien Agent”). The Second Lien Facility provided for a term loan in the amount of $60.0 million (the “Second Lien Facility”), and scheduled to mature on January 14, 2020. The term loan under the Second Lien Facility bore interest at a rate of LIBOR plus 14.00% per annum with a 1.0% LIBOR floor paid in kind quarterly in arrears. The payment-in-kind interest represents a non-cash operating and financing activity on the consolidated statements of cash flows for the years ended December 31, 2017 and 2016. The Company adopted ASU-2016-15 which provided specific guidance on cash flow classification issues such as debt prepayment or debt extinguishment costs, settlement of zero coupon debt instruments. The amendment was applied retrospectively to each period presented and the Company reclassified $17.4 million of accumulated payment-in-kind interest paid upon the discharge of the Second Lien Facility previously recorded as a use of cash from financing activities, as a use of cash from operating activities. On December 8, 2017, in connection with the refinancing defined above, Eagle Shipping repaid the outstanding debt and accumulated payment-in-kind interest aggregating $77.4 million, and discharged the debt under the Second Lien Facility in full. Eagle Shipping recorded the difference between the settlement price and the net carrying value of the debt amounting to $11.8 million, as loss on debt extinguishment in the Consolidated Statement of Operations for the year ended December 31, 2017. Exit Financing Facility On October 9, 2014, the Company entered into the Exit Financing Facility with the Exit Lenders. The Exit Financing Facility was in the amount of $275.0 million, is including a $50.0 million revolving credit facility out of which $40.0 million was drawn as of December 31, 2015, and had a maturity date of on October 15, 2019. Amounts drawn under the Exit Financing Facility bore interest at a rate of LIBOR plus margin ranging between 3.50% and 4.00% per annum. The revolving credit facility was subject to an annual commitment fee of 40% of the margin. The Exit Financing Facility was amended and restated in its entirety by Eagle Shipping on March 30, 2016 and succeeded by the First Lien Facility described above. Scheduled Debt Maturities The following table presents the scheduled maturities of principal amounts of our debt obligations for the next five years.
* The scheduled maturities exclude the impact of the refinancing of the New First Lien Facility and Original Ultraco Debt Facility on January 25, 2019. Refinancing On January 25, 2019, Ultraco entered into a new senior secured credit facility, 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. The proceeds from the New Ultraco Debt Facility were used to repay the outstanding debt including accrued interest under the Original Ultraco Debt Facility and the New First Lien Facility in full and for general corporate purposes. Subject to certain conditions set forth in the credit agreement, Ultraco may request an increase of up to $60.0 million in the aggregate principal amount of the Term Facility Loan. Outstanding borrowings under the New Ultraco Debt Facility bear interest at LIBOR plus 2.50% per annum. The New Ultraco Debt Facility matures on the earlier of (i) five years from the initial borrowing date and (ii) February 15, 2024 (the “Maturity Date”). Pursuant to the terms of the facility, Ultraco must repay the aggregate principal amount of $5.1 million in quarterly installments for the first year and $6.5 million in quarterly installments from the second year until the Maturity Date. Additionally, there is a semi-annual catch up amortization payments from excess cash flow with a maximum cumulative payable of $4.6 million, with a final balloon payment of all remaining outstanding debt to be made on the Maturity Date. Accrued interest on amounts outstanding under the New Ultraco Debt Facility must be paid on the last day of each applicable interest period. Interest periods are for three months, six months or any other period agreed between Ultraco and the Lenders. Ultraco must prepay certain specified amounts outstanding under the credit agreement if an Ultraco Vessel (as defined below) is sold or becomes a total loss or if there is a change of control with respect to the Company, Ultraco or any Guarantor. Ultraco’s obligations under New Ultraco Debt Facility are secured by, among other items, a first priority mortgage on 21 vessels owned by the Guarantors as identified in the Credit Agreement and such other vessels that it may from time to time include with the approval of the Lenders (the “Ultraco Vessels”), an assignment of certain accounts, an assignment of certain charters with terms that exceeds 12 months, an assignment of insurances, an assignment of certain master agreements, and a pledge of the membership interests of Eagle Ultraco and each Guarantor. In the future, Ultraco or the Guarantors may grant additional security to the Lenders from time to time. The New Ultraco Debt Facility contains financial covenants requiring the Company, on a consolidated basis excluding Shipco and any of Shipco’s subsidiaries (each, a “Restricted Subsidiary”) and any of the vessels owned by any Restricted Subsidiary to maintain a minimum amount of free cash or cash equivalents in an amount not less than the greater of (i) $0.6 million per owned vessel and (ii) 7.5% of the total consolidated debt of the Company and its subsidiaries, excluding any Restricted Subsidiary, which currently consists of amounts outstanding under the New Ultraco Debt Facility. The New Ultraco Debt Facility also requires the Company to maintain a liquidity reserve of $0.6 million per Ultraco Vessel in an unblocked account. Additionally, the credit agreement requires the Company, on a consolidated basis excluding any Restricted Subsidiary and the vessels owned by any Restricted Subsidiary, to maintain (i) a ratio of minimum value adjusted tangible equity to total assets ratio of not less than 0.30:1, (ii) a consolidated interest coverage ratio of not less than a range varying from 1.50 to 1.00 to 2.50 to 1.00, and (iii) a positive working capital. The credit agreement also imposes operating restrictions on Ultraco and the Guarantors, including limiting Ultraco’s and the Guarantors’ ability to, among other things: incur additional indebtedness; create liens on assets; sell assets; dissolve or liquidate; merge or consolidate with another person; make investments; engage in transactions with affiliates; and allow certain changes of control to occur. The credit agreement allows for the Company to pay dividends upon satisfaction of certain conditions set forth in the credit agreement. Finally, the credit agreement includes customary events of default, including those relating to: a failure to pay principal or interest; a breach of covenant, representation or warranty; a cross-default to other indebtedness; the occurrence of certain bankruptcy and insolvency events; the occurrence of certain ERISA events; a judgment default; the cessation of business; the impossibility or unlawfulness of performance of the loan documents; the ineffectiveness of any material provision of any loan document; the occurrence of a material adverse effect; and the occurrence of certain swap terminations. |
Derivative Instruments and Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Fair Value Measurements | Derivative Instruments and Fair Value Measurements Forward freight agreements, bunker swaps and freight derivatives The Company trades in forward freight agreements (“FFAs”) and bunker swaps, with the objective of utilizing this market as economic hedging instruments that reduce the risk of specific vessels to changes in the freight market. The Company’s FFAs and bunker swaps have not qualified for hedge accounting treatment. As such, unrealized and realized gains are recognized as a component of other expense in the Consolidated Statement of Operations and Other current assets and Fair value of derivatives in the Consolidated Balance Sheets. Derivatives are considered to be Level 2 instruments in the fair value hierarchy. The effect of non-designated derivative instruments on the Consolidated Statements of Operations:
Cash Collateral Disclosures The Company does not offset fair value amounts recognized for derivatives by the right to reclaim cash collateral or the obligation to return cash collateral. The amount of collateral to be posted is defined in the terms of respective master agreement executed with counterparties or exchanges and is required when agreed upon threshold limits are exceeded. As of December 31, 2018 and December 31, 2017, the Company posted cash collateral related to derivative instruments under its collateral security arrangements of $0.8 million and $0.2 million, respectively, which is recorded within other current assets in the consolidated balance sheets. Fair Value Measurements The following methods and assumptions were used to estimate the fair value of each class of financial instrument: Cash, cash equivalents and restricted cash—the carrying amounts reported in the consolidated balance sheets for interest-bearing deposits approximate their fair value due to their short-term nature thereof. Debt—the carrying amounts of borrowings under the Norwegian Bond Debt, New First Lien Facility and Original Ultraco Debt Facility (prior to application of the discount and debt issuance costs) including the revolving credit agreement approximate their fair value, due to the variable interest rate nature thereof. The Company defines fair value, establishes a framework for measuring fair value and provides disclosures about fair value measurements. The fair value hierarchy for disclosure of fair value measurements is as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities. Our Level 1 non-derivatives include cash, money-market accounts, certain short-term investments and restricted cash accounts. Level 2 – Quoted prices for similar assets and liabilities in active markets or inputs that are observable. Our Level 2 non-derivatives include our short-term investments and debt balances under the Norwegian Bond Debt, New First Lien Facility and Original Ultraco Debt Facility. Level 3 – Inputs that are unobservable (for example cash flow modeling inputs based on assumptions). Assets and liabilities measured at fair value:
(1) Includes non-current restricted cash of $11.0 million at December 31, 2018 and $0.1 million at December 31, 2017.
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Commitments and Contingencies |
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Operating Lease On October 15, 2015, the Company entered into a new commercial lease agreement as a subtenant for office space in Stamford, Connecticut. The lease is effective from January 1, 2016 through June 29, 2023, with an average annual rent of $0.4 million. The lease is secured by a letter of credit backed by cash collateral of $74,917 which amount is recorded as restricted cash in the accompanying consolidated balance sheets. In November 2018, the Company entered into a lease office agreement in Singapore, which expires in October 2021, with an average annual rent of $0.3 million. Rent expense for all of our global locations recorded for the years ended December 31, 2018, 2017, and 2016 was $0.7 million, $0.7 million and $0.8 million, respectively. The future minimum commitments under the leases for office space as of December 31, 2018 are as follows: (In thousands of U.S. dollars)
Legal Proceedings The Company is involved in legal proceedings and may become involved in other legal matters arising in the ordinary course of its business. The Company evaluates these legal matters on a case-by-case basis to make a determination as to the impact, if any, on its business, liquidity, results of operations, financial condition or cash flows. In November 2015, the Company filed a voluntary self-disclosure report regarding certain apparent violations of U.S. sanctions regulations in the provision of shipping services for third party charterers with respect to the transportation of cargo to or from Myanmar. At the time of such apparent violations, the Company had a different senior operational management team. There can be no assurance that OFAC will not conclude that these past actions warrant the imposition of civil penalties and/or referral for further investigation by the U.S. Department of Justice. The report was provided to OFAC for the agency’s review, consideration and determination regarding what action, if any, may be taken in resolution of this matter. The Company will continue to cooperate with the agency regarding this matter and cannot estimate when such review will be concluded. While the ultimate impact of these matters cannot be determined, there can be no assurance that the impact will not be material to the Company’s financial condition or results of operations. Other Commitments On July 28, 2011, the Company entered into an agreement to charter in a 37,000 dwt newbuilding Japanese vessel that was delivered in October 2014 for seven years with an option for an additional one year. The hire rate for the first to seventh year is $13,500 per day and $13,750 per day for the eighth year option. On May 10, 2017, the Company signed an agreement to cancel this existing time charter contract. The Company agreed to pay a lump sum termination fee of $1.5 million relating to the cancellation. At the same time, the Company entered into an agreement with the same lessor, effective April 28, 2017 to charter in a 61,400 dwt, 2013 built Japanese vessel for approximately four years (having the same redelivery dates as the aforementioned cancelled charter) with options for two additional years. The hire rate for the first four years is $12,800 per day and the hire rate for the first optional year is $13,800 per day and $14,300 per day for the second optional year. On May 4, 2018, the Company entered into an agreement to charter-in a 61,425 dwt 2013 built Ultramax vessel for three years with an option for an additional two years. The hire rate for the first three years is $12,700 per day and $13,750 per day for the 1st year option and $14,750 per day for the second year option. The Company took delivery of the vessel in the third quarter of 2018. On December 9, 2018, the Company entered into an agreement to charter-in a 62,487 dwt 2016 built Ultramax vessel for two years. The hire rate for the vessel until March 2020 is $14,250 per day and $15,250 per day thereafter. The Company took delivery of the vessel in the fourth quarter of 2018. On August 14, 2018, the Company entered into a contract for installation of ballast water treatment systems ("BWTS") on our owned vessels. The projected costs, including installation, is approximately $0.5 million per BWTS. The Company intends to complete the installation during scheduled drydockings. The Company recorded $1.0 million in Other assets in the Consolidated Balance Sheet as of December 31, 2018. On September 4, 2018, the Company entered into a series of agreements to purchase up to 37 Scrubbers which are to be retrofitted on the vessels. The Agreements are comprised of firm orders for 19 Scrubbers and up to an additional 18 units, at the Company’s option. On November 20, 2018 the Company announced that it has exercised its option to purchase 15 of the 18 Scrubbers, and on January 23, 2019 the Company announced that it has exercised the remaining 3 options. The projected costs, including installation, is approximately $2.2 million per Scrubber. The Company intends to complete the retrofit of all 37 vessels prior to the January 1, 2020 implementation date of the new sulphur emission cap regulation, as set forth by the IMO. The Company recorded $16.9 million of Scrubber costs and $1.0 million for ballast water treatment systems in Other assets in the Consolidated Balance Sheet as of December 31, 2018. On December 21, 2018, the Company signed a memorandum of agreement to purchase a 2015 built Ultramax vessel for $20.4 million. As of December 31, 2018, the Company paid a deposit of $2.0 million. The Company took delivery of the vessel in the first quarter of 2019. |
Income/(Loss) per Common Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income/(Loss) per Common Share | Income/(Loss) per Common Share The computation of basic net income/(loss) per share is based on the weighted average number of common shares outstanding for the years ended December 31, 2018, 2017 and 2016. As of December 31, 2018 and 2017, the Company had 3,040,540 outstanding warrants convertible to 152,027 shares of the Company's common stock with an exercise price of $556.40 per share. The warrants have a 7 year term and will expire on October 15, 2021. Diluted net income/(loss) per share gives effect to stock awards, stock options and restricted stock units using the treasury stock method, unless the impact is anti-dilutive. Diluted net income per share for the year ended December 31, 2018 does not include 687 unvested stock awards, 348,625 stock options and outstanding warrants convertible to 152,027 shares of common stock as their effect was anti-dilutive. Diluted net loss per share for the year ended December 31, 2017 does not include 1,716,928 unvested stock awards, 2,301,046 stock options and outstanding warrants convertible to 152,027 shares of common stock as their effect was anti-dilutive. Diluted net loss per share for the year ended December 31, 2016 does not include 1,413,461 unvested stock awards, 1,942,909 stock options and outstanding warrants convertible into 152,027 shares of common stock as their effect was anti-dilutive.
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Stock Incentive Plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Incentive Plans | Stock Incentive Plans 2014 Management Incentive Plan On October 15, 2014, in accordance with the Plan of Reorganization, the Company adopted the post-emergence Management Incentive Program (the “2014 Plan”), which provided for the distribution of New Eagle MIP Primary Equity in the form of shares of New Eagle Common Stock, and New Eagle MIP Options, to the participating senior management and other employees of the reorganized Company with 2% of the New Eagle Common Stock (on a fully diluted basis) on the Effective Date, and two tiers of options to acquire 5.5% of the New Eagle Common Stock (on a fully diluted basis) with different strike prices based on the equity value for the reorganized Company and a premium to the equity value, each of the foregoing to vest generally over a four year schedule through 25% annual installments commencing on the first anniversary of the Effective Date. The New Eagle MIP Primary Equity is subject to vesting, but the holder thereof is entitled to receive all dividends paid with respect to such shares as if such New Eagle MIP Primary Equity had vested on the grant date (subject to forfeiture by the holder in the event that such grant is terminated prior to vesting unless the administrator of the 2014 Plan determines otherwise). The New Eagle MIP Options contain adjustment provisions to reflect any transaction involving shares of New Eagle Common Stock, including as a result of any dividend, recapitalization, or stock split, to prevent any diminution or enlargement of the holder’s rights under the award. During 2018, 1,432 restricted stock awards vested and 83 restricted stock awards were forfeited. There were 50,625 unvested restricted stock awards outstanding with an average share price on grant date of $5.90 as of December 31, 2018. The restricted stock awards are expected to vest fully during 2019. The amortization of these restricted shares was calculated using the cliff method of vesting and included in general and administrative expenses in the consolidated statement of operations for the years ended December 31, 2018, 2017 and 2016. During 2017, 133,452 restricted stock awards vested and there were 52,140 restricted stock awards outstanding with an average share price on grant date of $42.19 as of December 31, 2017. As of December 31, 2018, there were 12,875 options vested but unexercised with exercise prices ranging from $360 to $505 and there were no unvested MIP options. The fair value of the vested options is insignificant. There were 9,960 options vested but not exercised as of December 31, 2017 and 2,915 options that were not vested but were expected to vest. The fair value of vested options is insignificant. On November 7, 2016, the Company granted 233,863 shares of restricted common stock and options to purchase 280,000 shares of the Company’s common stock in connection with the appointment of a new member to the senior management team. The restricted stock and option were not granted under, but are subject to, the terms of the Company’s 2014 Plan. The details of the grant are below:
* Amortization of the above stock awards was calculated using the cliff method of vesting and included in general and administrative expenses.
** The volatility was calculated by comparing the Company’s share price movement since emergence from bankruptcy on October 14, 2014 and its peers’ share price movement for the past five years. The amortization of these stock options was calculated using the graded method of vesting and included in general and administrative expenses. There are 140,000 options vested but not exercised and 140,000 unvested options, all of which are expected to vest as of December 31, 2018. The vested but not exercised options expire at various dates beginning November 2022 until November 2023 at an exercise price of $4.28 per share. There were 70,000 options vested but not exercised as of December 31, 2017 and 210,000 options expected to vest. 2016 Equity Compensation Plan On December 15, 2016, the Company’s shareholders approved the 2016 Equity Compensation Plan (the “2016 Plan”) and the Company registered 5,348,613 shares of common stock which may be issued under the 2016 Plan. The 2016 Plan replaced the 2014 Plan and no other awards will be granted under the 2014 Plan. Outstanding awards under the 2014 Plan will continue to be governed by the terms of the 2014 Plan until exercised, expired, otherwise terminated, or canceled. Under the terms of the 2016 Plan, awards for up to a maximum of 3,000,000 shares may be granted under the 2016 Plan to any one employee of the Company and its subsidiaries during any one calendar year, and awards in the form of options and stock appreciation rights for up to a maximum of 3,000,000 shares may be granted under the 2016 Plan. The total number of shares of common stock with respect to which awards may be granted under the 2016 Plan to any non-employee director during any one calendar year shall not exceed 500,000, subject to adjustment as provided in the 2016 Plan. Any Director, officer, employee or consultant of the Company or any of its subsidiaries (including any prospective officer or employee) is eligible to be designated to participate in the 2016 Plan. The Company withheld shares related to restricted stock awards that vested in 2018 at the fair market value equivalent to the maximum statutory withholding obligation, and remitted that amount in cash to the appropriate taxation authorities. The following schedule represents outstanding stock awards and options granted under the 2016 Plan as of December 31, 2018.
*The above stock awards were issued concurrently with the cancellation of outstanding stock awards and options under the 2014 Plan. Therefore, the issuance was accounted for as a modification as per ASC 718 “Compensation-Stock Compensation.” The fair value is the incremental compensation cost, which was calculated as the excess of the fair value of the replacement award over the fair value of the cancelled award at the cancellation date. The amortization of the above stock awards was calculated using the graded method of vesting and included in general and administrative expenses.
*The volatility was calculated by comparing the Company’s share price movement since emergence from bankruptcy on October 14, 2014 and its peers’ share price movement for the past five years. **The above stock options were issued concurrently with cancellation of outstanding stock awards and options under the 2014 Equity Incentive Plan. Therefore, the transaction was accounted for as a modification as per ASC 718 “Compensation-Stock Compensation.” The fair value is the incremental compensation cost, which was calculated as the excess of the fair value of the replacement award over the fair value of the cancelled award at the cancellation date. The amortization of the above stock options was included in general and administrative expenses. There are 1,353,586 options vested but not exercised as of December 31, 2018 and 651,835 options expected to vest. The Company issues new shares upon exercise of any vested options. The vested but not exercised options expire at various dates beginning September 2022 until October 2023 at exercise prices ranging between $4.28 to $5.56 per share. There were 828,085 options vested but not exercised as of December 31, 2017 and 1,180,086 options expected to vest. The stock-based compensation expense for the above stock awards and options under the 2016 Plan and 2014 Plan included in General and administrative expenses:
The future compensation to be recognized for all the grants issued for the years ending December 31, 2019, 2020 and 2021 is estimated to be $4.7 million, $1.7 million and $0.5 million, respectively. |
Employee Benefit Plan |
12 Months Ended |
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Dec. 31, 2018 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan In October 2010, the Company established a safe harbor 401(k) plan, which is available to full-time office employees who meet the plan’s eligibility requirements. The plan allows participants to contribute to the plan a percentage of pre-tax compensation, but not in excess of the maximum allowed under the Internal Revenue Code. The Company is matching contributions amounting to 100% of the first 3% and 50% of the next 2% of each employee’s salary. The matching contribution vests immediately. The total matching contribution incurred by the Company and included in general and administrative expenses for the years ended December 31, 2018, 2017 and 2016 was $275,674, $240,888 and $167,778, respectively. The Company has a discretionary profit sharing contribution program under which employees may receive profit sharing contributions based on the Company’s annual operating performance. For the years ended December 31, 2018, 2017 and 2016, the Company did not make a profit sharing contribution. The Company revised its matching contributions to 100% of the first 6% of each employee's salary beginning January 1, 2019. |
Quarterly Results of Operations (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Results of Operations (Unaudited) | Quarterly Results of Operations (Unaudited) We have presented the unaudited quarterly results of operations for the fiscal years ended December 31, 2018 and December 31, 2017. Consolidated Statement of Operations (Unaudited) 2018
2017
* Net loss for the three months ended December 31, 2017 includes $15.0 million of loss on debt extinguishment. |
Subsequent Events |
12 Months Ended |
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Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On January 2, 2019, the Company granted 781,890 restricted shares as a company-wide grant under the 2016 Plan. The fair value of the grant based on the closing share price on December 31, 2018 was $3.7 million. The shares will vest in equal installments over a three year term. During first quarter of 2019, the Company delivered the vessel Condor to its buyer pursuant to a memorandum of agreement, dated December 13, 2018 for net proceeds of $6.5 million. The Company expects to recognize a gain of $2.2 million. On January 4, 2019, the Company signed a memorandum of agreement to sell the vessel Merlin for $6.1 million after brokerage commissions and associated selling expenses. The vessel was delivered to the buyers in January 2019. The Company will record a gain of approximately $1.9 million in the first quarter of 2019. As discussed above in Note 8 Debt - Refinancing, on January 25, 2019, Ultraco entered into the New Ultraco Debt Facility, which provides for an aggregate principal amount of $208.4 million, consisting of (i) a term loan facility of $153.4 million and (ii) a revolving credit facility of $55.0 million The proceeds from the New Ultraco Debt Facility were used to repay the outstanding debt including accrued interest under the Original Ultraco Debt Facility and the New First Lien Facility in full and for general corporate purposes. |
Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Principles of Consolidation | Principles of Consolidation: The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles and include the accounts of Eagle Bulk Shipping Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions were eliminated upon consolidation. |
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Use of Estimates | Use of Estimates: The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include vessel valuations, residual value of vessels, the useful lives of vessels, the value of stock-based compensation and the fair value of derivatives. Actual results could differ from those estimates. |
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Other Comprehensive income/(loss) | Other Comprehensive income/(loss): The Company records the fair value of interest rate swaps and foreign currency swaps designated as hedges as an asset or liability on the balance sheet. The effective portion of the swap is recorded in accumulated other comprehensive loss. Historically, the Company also recorded the unrealized gains and losses on its available for sale investments in accumulated other comprehensive loss. |
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Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash: The Company considers liquid investments such as time deposits and certificates of deposit with an original maturity of three months or less at the time of purchase to be cash equivalents |
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Accounts Receivable | Accounts Receivable: Accounts receivable includes receivables from charterers for time and voyage charterers. At each balance sheet date, all potentially uncollectible accounts are assessed for purposes of determining the appropriate provision for doubtful accounts. |
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Insurance Claims | Insurance Claims: Insurance claims are recorded as incurred and represent the claimable expenses, net of deductibles, incurred through each balance sheet date, which are expected to be recovered from insurance companies. |
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Inventories | Inventories: Inventories, which consist of bunkers, are stated at cost which is determined on a first-in, first-out method. Lubes and spares are expensed as incurred. |
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Short-term Investments | Short-term Investments: The Company considers liquid investments such as certificate of deposits with an original maturity of greater than three months as investments. As of December 31, 2017, the Company had $4.5 million in a certificate of deposit with an original maturity of one year. |
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Vessels and vessel improvements, at cost | Vessels and vessel improvements, at cost: Vessels are stated at cost, which consists of the contract price, and other direct costs relating to acquiring and placing the vessels in service. Major vessel improvements are capitalized and depreciated over the remaining useful lives of the vessels. Depreciation is calculated on a straight-line basis over the estimated useful lives of the vessels based on the cost of the vessels reduced by the estimated scrap value of the vessels as discussed below. |
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Vessel lives | Vessel lives and Impairment of Long-Lived Assets: The Company estimates the useful life of the Company's vessels to be from the date of initial delivery from the shipyard to the original owner. The useful lives of the Company's vessels are evaluated to determine if events have occurred which would require modification to their useful lives. In addition, the Company estimates the scrap value of the vessels to be $300 per light weight ton ("lwt"). |
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Impairment of Long-Lived Assets | The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. When the estimate of undiscounted cash flows, excluding interest charges, expected to be generated by the use of the asset is less than its carrying amount, the Company will evaluate the asset for an impairment loss. Measurement of the impairment loss is based on the fair value of the asset as provided by third parties. In this respect, management regularly reviews the carrying amount of the vessels in connection with the estimated recoverable amount for each of the Company's vessels. |
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Accounting For Drydocking Costs | Accounting for Drydocking Costs: The Company follows the deferral method of accounting for drydocking costs whereby actual costs incurred are deferred and are amortized on a straight-line basis over the period through the date the next drydocking is required to become due, generally 30 months if the vessels are 15 years old or more and 60 months for the vessels younger than 15 years. Costs deferred as part of the drydocking include direct costs that are incurred as part of the drydocking to meet regulatory requirements. Certain costs are capitalized during drydocking if they are expenditures that add economic life to the vessel, increase the vessel’s earnings capacity or improve the vessel’s efficiency. Direct costs that are deferred include the shipyard costs, parts, inspection fees, steel, blasting and painting. Expenditures for normal maintenance and repairs, whether incurred as part of the drydocking or not, are expensed as incurred. Unamortized drydocking costs of vessels that are sold are written off and included in the calculation of the resulting gain or loss in the year of the vessels’ sale. Unamortized drydocking costs are written off as drydocking expense if the vessels are drydocked before the expiration of the applicable amortization period. |
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Deferred Financing Costs | Deferred Financing Costs: Fees incurred for obtaining new loans or refinancing existing ones are deferred and amortized to interest expense over the life of the related debt using the effective interest method. Unamortized deferred financing costs are written off when the related debt is repaid or refinanced and such amounts are expensed in the period the repayment or refinancing is made. Such amounts are classified as a reduction of the long-term debt balance on the consolidated balance sheets. |
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Other fixed assets | Other fixed assets: Other fixed assets are stated at cost less accumulated depreciation. Depreciation is based on a straight-line basis over the estimated useful life of the asset. Other fixed assets consist principally of leasehold improvements, computers and software and are depreciated over three years |
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Accounting For Revenues And Expenses | Accounting for Revenues and Expenses: Revenues generated from time charters and/or revenues generated from profit sharing arrangements are recognized on a straight-line basis over the term of the respective time charter agreements as service is provided and the profit sharing is fixed and determinable. Under voyage charters, voyage revenues for cargo transportation are recognized ratably over the estimated relative transit time of each voyage. Voyage revenue is deemed to commence upon the loading of the charterer’s cargo and is deemed to end upon the completion of discharge, provided an agreed non-cancellable charter between the Company and the charterer is in existence, the charter rate is fixed and determinable, and collectability is reasonably assured. Revenue under voyage charters will not be recognized until a charter has been agreed even if the vessel has discharged its previous cargo and is proceeding to an anticipated port of loading. Under voyage charters, voyage expenses such as bunkers, port charges, canal tolls, cargo handling operations and brokerage commissions are paid by the Company whereas, under time charters, such voyage costs are paid by the Company's customers. Vessel operating costs include crewing, vessel maintenance and vessel insurance. All voyage and vessel operating expenses are expensed as incurred on an accrual basis, except for commissions. Commissions are recognized over the related time or voyage charter period since commissions are earned as the Company's revenues are earned. Probable losses on voyages are provided for in full at the time such loss can be estimated. We adopted ASC 606 as of January 1, 2018 utilizing the modified retrospective method of transition. We recorded an adjustment of approximately $0.8 million to increase our opening accumulated deficit and increase our unearned revenue and other current assets on our Consolidated Balance Sheet on January 1, 2018. |
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Unearned Charter Hire Revenue | Unearned Charter Hire Revenue: Unearned charter hire revenue represents cash received from charterers prior to the time such amounts are earned. These amounts are recognized as revenue as services are provided in future periods. |
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Repairs and Maintenance | Repairs and Maintenance: All repair and maintenance expenses are expensed as incurred and are recorded in Vessel Expenses. |
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Protection and Indemnity Insurance | Protection and Indemnity Insurance: The Company’s Protection and Indemnity Insurance is subject to additional premiums referred to as "back calls" or "supplemental calls" which are accounted for on an accrual basis and are recorded in Vessel Expenses. |
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Earnings Per Share | Earnings Per Share: Basic earnings per share is computed by dividing the net income or loss by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the impact of stock options, warrants and restricted stock under the treasury stock method unless their impact is anti-dilutive. |
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Interest Rate Risk Management | Interest Rate Risk Management: The Company is exposed to the impact of interest rate changes for outstanding debt under the New First Lien Facility and the Original Ultraco Debt Facility. The Company's objective is to manage the impact of interest rate changes on earnings and cash flows of its borrowings. The Company may use interest rate swaps to manage net exposure to interest rate changes related to its borrowings. |
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Federal Taxes | Federal Taxes: The Company is a Republic of the Marshall Islands Corporation. For the years ended December 31, 2018 and 2017, the Company believes that its operations qualify for Internal Revenue Code Section 883 exemption and therefore are not subject to United States federal taxes on United States source shipping income. |
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Restructuring charges | Restructuring charges: Restructuring charges consist of professional fees for advisors and attorneys who assisted the Company in the debt restructuring relative to the First Lien Facility in 2016. |
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Share-based compensation | Stock-based compensation: The Company issues stock-based compensation utilizing both stock options and stock grants. Stock-based compensation is measured at the fair value of the award at the date of grant and recognized over the period of vesting on a straight-line basis using the graded vesting method. The grant-date fair value of stock options is estimated using the Black-Scholes option pricing model. Forfeitures are recognized as they occur. |
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Impact of Recently Issued Accounting Standards | Impact of Recently Adopted Accounting Standards Revenue recognition Time charters Our shipping revenues are principally generated from time charters and voyage charters. In a time charter contract, the vessel is hired by the charterer for a specified period of time in exchange for consideration which is based on a daily hire rate. The charterer has the full discretion over the ports visited, shipping routes and vessel speed. The contract/charter party generally provides typical warranties regarding the speed and performance of the vessel. The charter party generally has some owner protective restrictions such that the vessel is sent only to safe ports by the charterer, subject always to compliance with applicable sanction laws, and carry only lawful or non hazardous cargo. In a time charter contract, the Company is responsible for all the costs incurred for running the vessel such as crew costs, vessel insurance, repairs and maintenance and lubes. The charterer bears the voyage related costs such as bunker expenses, port charges and canal tolls during the hire period. The performance obligations in a time charter contract are satisfied over the term of the contract beginning when the vessel is delivered to the charterer until it is redelivered back to the Company. The charterer generally pays the charter hire in advance of the upcoming contract period. The time charter contracts are considered operating leases and therefore do not fall under the scope of ASC 606 because (i) the vessel is an identifiable asset (ii) the Company does not have substantive substitution rights and (iii) the charterer has the right to control the use of the vessel during the term of the contract and derives the economic benefits from such use. Voyage charters In a voyage charter contract, the charterer hires the vessel to transport a specific agreed-upon cargo for a single voyage which may contain multiple load ports and discharge ports. The consideration in such a contract is determined on the basis of a freight rate per metric ton of cargo carried or occasionally on a lump sum basis. The charter party generally has a minimum amount of cargo. The charterer is liable for any short loading of cargo or "dead" freight. The voyage contract generally has standard payment terms of 95% freight paid within three days after completion of loading. The voyage charter party generally has a "demurrage" or "despatch" clause. As per this clause, the charterer reimburses the Company for any potential delays exceeding the allowed laytime as per the charter party clause at the ports visited which is recorded as demurrage revenue. Conversely, the charterer is given credit if the loading/discharging activities happen within the allowed laytime known as despatch resulting in a reduction in revenue. In a voyage charter contract, the performance obligations begin to be satisfied once the vessel begins loading the cargo. The Company determined that its voyage charter contracts consist of a single performance obligation of transporting the cargo within a specified time period. Therefore, the performance obligation is met evenly as the voyage progresses. and the revenue is recognized on a straight line basis over the voyage days from the commencement of the loading of cargo to completion of discharge. The voyage contracts are considered service contracts which fall under the provisions of ASC 606 because the Company as the shipowner retains the control over the operations of the vessel such as directing the routes taken or the vessel speed. The voyage contracts generally have variable consideration in the form of demurrage or despatch. The amount of revenue earned as demurrage or despatch paid by the Company for the year ended December 31, 2018 is not material. The following table shows the revenues earned from time charters and voyage charters for the year ended December 31, 2018:
Contract costs In a voyage charter contract, the Company bears all voyage related costs such as fuel costs, port charges and canal tolls. These costs are considered contract fulfillment costs because the costs are direct costs related to the performance of the contract and are expected to be recovered. The costs incurred during the period prior to commencement of loading the cargo, primarily bunkers, are deferred as they represent setup costs and recorded as a current asset and are amortized on a straight-line basis as the related performance obligations are satisfied. We adopted the provisions of ASC 606 on January 1, 2018 using the modified retrospective approach. As such, the comparative information has not been restated and continues to be reported under the accounting standards in effect for periods prior to January 1, 2018. Under the modified retrospective approach, the Company recognized the cumulative effect of adopting this standard as an adjustment amounting to $0.8 million to increase the opening balance of Accumulated Deficit as of January 1, 2018. The Company recognized $0.8 million of deferred costs which represents the costs, such as bunker expenses and charter hire expenses on chartered-in vessels, incurred prior to commencement of loading which are recorded in other current assets and $1.6 million of unearned charter hire revenue which represents the Company's obligation to satisfy performance obligations under the contract for which the Company has received consideration from the customer. The adoption of ASC 606 impacted the timing of recognition of revenue for certain ongoing spot voyage charter contracts, related voyage expenses and charter hire expenses. Under ASC 606, revenue is recognized from when the vessel commences loading through the completion of discharge at the discharge port instead of recognizing revenue from the discharge of the previous voyage provided an agreed non-cancellable charter between the Company and the charterer is in existence, the charter rate is fixed and determinable, and collectability is reasonably assured. Any expenses incurred during the ballast portion of the voyage (time spent by the vessel traveling from discharge port of the previous voyage to the load port of the subsequent voyage) such as bunker expenses, canal tolls and charter hire expenses for chartered-in vessels are deferred and are recognized on a straight-line basis over the charter period as the Company satisfies the performance obligations under the contract. Further, the adoption of ASC 606 impacted the accounts receivable and unearned revenue on our Consolidated Balance Sheet as of December 31, 2018. Under ASC 606, receivables represent an entity's unconditional right to consideration, billed or unbilled. The Company determined that the performance obligations on its spot voyage charters do not begin to be satisfied unless the vessel arrives at the load port and commences loading the cargo. This impacted the amount of accounts receivable and unearned revenue recorded in our Consolidated Balance Sheet. The following table presents the impact of the adoption of ASC 606 on our Consolidated Balance Sheet at December 31, 2018:
The following table presents the impact of the adoption of ASC 606 on our Consolidated Statement of Operations:
The cumulative effect of changes made to our opening Consolidated Balance Sheet on January 1, 2018 for the adoption of ASC 606:
(1) Under ASC 606, the contract fulfillment costs are deferred as a current asset and amortized as the related performance obligations are satisfied. The adjustment to other current assets includes bunker expenses of $0.6 million incurred to arrive at the load port for the voyages in progress as of January 1, 2018 and $0.2 million of charter hire expenses on third party chartered-in vessels which were chartered-in to fulfill the performance obligations under the voyage contract. (2) Under ASC 606, unearned charter hire revenue represents the consideration received for undelivered performance obligations. The Company recorded $0.7 million as unearned revenue on voyages in progress as of January 1, 2018. The Company recognized this revenue in the first quarter of 2018 as the performance obligations were met. The adoption of ASC 606 had no impact on net cash provided by operating activities, investing activities and financing activities for the year ended December 31, 2018. Cash, cash equivalents and restricted cash In November 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-18. The amendments in Accounting Standard Update ("ASU") 2016-18 require that a statement of cash flows explain the change during the year in the total of cash, cash equivalents, and amounts described as restricted cash and restricted cash equivalents. Therefore, the restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-year and end-of-year total amounts shown on the statement of cash flows. We adopted this accounting standard as of January 1, 2018 and $11.0 million of restricted cash has been aggregated with the cash and cash equivalents as of December 31, 2018. Additionally, we retrospectively aggregated $74,917 of restricted cash with cash and cash equivalents in both the beginning-of-year and end-of-year line items at the bottom of the statements of cash flows for the years ended December 31, 2017 and 2016. Statement of cash flows (Topic 230) - classification of certain cash receipts and cash payments In August 2016, the FASB issued Accounting Standards Update No. 2016-15, “Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments” ("ASU-2016-15"). The new guidance is intended to provide specific guidance on cash flow classification issues such as debt prepayment or debt extinguishment costs, settlement of zero coupon debt instruments or cases where the coupon interest rate is insignificant compared to the effective interest rate of the borrowing, contingent consideration payments in a business combination, proceeds from insurance claim settlements and distributions received by equity method investees. The standard is effective for annual periods beginning after December 15, 2017 and interim periods within those annual periods. The amendment was applied retrospectively to each period presented and the Company reclassified $17.4 million of accumulated payment-in-kind interest paid upon the discharge of the Second Lien Facility (defined herein) in 2017 previously recorded as a use of cash from financing activities, as a use of cash from operating activities. In May 2017, the FASB issued ASU No. 2017-09, Compensation-Stock Compensation ("ASU 2017-09"), which provides guidance about what changes to the terms and conditions of a stock award require an entity to apply modification accounting as per ASC 718. An entity should account for effects of modification unless (i) the fair value of the modified award is the same as the fair value of the original award (ii) the vesting conditions of the modified award are the same as the vesting conditions of the original award and (iii) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award. The standard is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2017. There was no impact on the Company's consolidated financial statements upon adoption of this accounting standard. In January 2017, the FASB issued Accounting Standards Update No. 2017-1, “Business Combinations (Topic 805).” The amendments in this update are intended to clarify the definition of business. The current guidance specifies three elements of a business – inputs, processes, and outputs. The new guidance provides a screen to determine when a set (defined as an integrated set of assets and activities) is not a business. The ASU requires that, to be a business, the set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. The screen requires that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. The standard is effective to annual periods beginning after December 15, 2017, including interim periods within those periods. As of December 31, 2018, there was no impact on the Company's consolidated financial statements upon adoption of this accounting standard as the Company had no business combination transaction in 2018. Accounting Standards issued but not yet adopted. The FASB has issued accounting standards that had not yet become effective as of December 31, 2018 and may impact the Company’s consolidated financial statements or related disclosures in future periods. Those standards and their potential impact are discussed below. Accounting standards effective in 2019 In February 2016, the FASB issued ASU No. 2016-02, "Leases ( Topic 842)," as amended ("ASU No. 2016-02"), which revises the accounting for leases. Under the new guidance, lessees are required to recognize a right-of-use asset and a lease liability for substantially all leases. The new guidance will continue to classify leases as either financing or operating, with classification affecting the pattern of expense recognition. The accounting applied by a lessor under the new guidance will be substantially equivalent to current lease accounting guidance. Entities have the option to adopt the new guidance using a modified retrospective approach through an adjustment to retained earnings applied either to the beginning of the earliest period presented or the beginning of the period of adoption. The new guidance was effective January 1, 2019 and will be applied using a modified retrospective approach through a cumulative effect adjustment to retained earnings as of January 1, 2019. The most significant effects of adoption relate to the recognition of right-of-use assets and lease liabilities on our balance sheet for operating leases and providing new disclosures about our leasing activities. We currently expect the right-of-use assets and lease liabilities as of January 1, 2019 to range from $27.0 million to $35.0 million based on the present value of the Company’s remaining minimum lease payments, primarily due to the recognition of right of use assets and lease liabilities with respect to operating leases. We do not believe the adoption of ASC 842 will have a material effect on our consolidated results of operations or cash flows. The Company will provide the required disclosures under the standard in its Form 10-Q filing for the quarterly period ending March 31, 2019. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging ("ASU-2017-12"), which is intended to align the results of the cash flow and fair value hedge accounting with the risk management activities of an entity. The amendments expand the hedge accounting for both financial and non-financial risk components and they reduce the operational burden of applying hedge accounting. The amendment enables the financial statements to reflect accurately the intent and outcome of its hedging strategies. ASU 2017-12 requires a modified retrospective transition method in which the Company will recognize the cumulative effect of the change on the opening balance of each affected component of equity in the consolidated balance sheet as of the date of adoption. The Standard is effective for fiscal years beginning after December 15, 2018, and interim periods with those fiscal years. The Company currently is not expecting any material impact as a result of adoption of this accounting standard on its consolidated financial statements as we do not apply hedge accounting of our freight forward agreements and bunker swaps. In July 2017, the FASB issued ASU No. 2017-11, "Earnings Per Share, Distinguishing Liabilities from Equity, and Derivatives and Hedging" ("ASU No. 2017-11"), which changes the classification of certain equity-linked financial instruments with down round features. As a result, a free standing equity-linked financial instrument or an embedded conversion option would not be accounted for as a derivative liability at fair value as a result of existence of a down round feature. For freestanding equity classified financial instruments, the amendment requires the entities to recognize the effect of the down round feature when triggered in its earnings per share calculations. The standard is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently not expecting any material impact as a result of adoption of this accounting standard on its consolidated financial statements as we have not elected to apply hedge accounting related to our freight forward agreements and bunker swaps. Accounting standards effective in 2020 In August 2018, the FASB issued ASU No. 2018-13, Fair value measurement ( "ASU 2018-13"). ASU 2018-13 is intended to streamline the disclosures requirements on fair value measurements. Disclosures such as the amounts of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, and the valuation process for Level 3 fair value measurements were removed. Additional disclosures such as disclosure about changes in unrealized gains and losses included in the other comprehensive income for Level 3 fair value measurements, the range and weighted average of significant unobservable inputs used for Level 3 fair value measurements are required to be reported by the public entities. The amendment is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company is currently evaluating the impact of the adoption of the accounting standard on its consolidated financial statements. |
Significant Accounting Policies Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following table shows the revenues earned from time charters and voyage charters for the year ended December 31, 2018:
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Schedule of Impact of Adoption of ASC 606 | The following table presents the impact of the adoption of ASC 606 on our Consolidated Balance Sheet at December 31, 2018:
The following table presents the impact of the adoption of ASC 606 on our Consolidated Statement of Operations:
The cumulative effect of changes made to our opening Consolidated Balance Sheet on January 1, 2018 for the adoption of ASC 606:
(1) Under ASC 606, the contract fulfillment costs are deferred as a current asset and amortized as the related performance obligations are satisfied. The adjustment to other current assets includes bunker expenses of $0.6 million incurred to arrive at the load port for the voyages in progress as of January 1, 2018 and $0.2 million of charter hire expenses on third party chartered-in vessels which were chartered-in to fulfill the performance obligations under the voyage contract. (2) Under ASC 606, unearned charter hire revenue represents the consideration received for undelivered performance obligations. The Company recorded $0.7 million as unearned revenue on voyages in progress as of January 1, 2018. The Company recognized this revenue in the first quarter of 2018 as the performance obligations were met. |
Vessels and vessel improvements (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Vessel And Vessel Improvements |
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Deferred Drydock Costs (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Dry Docking Activity | Drydocking activity is summarized as follows:
* The Company wrote off drydock expenses of $0.5 million relating to the sale of vessels Avocet and Thrush, which was recorded in (gain)/loss on sale of vessels in the Consolidated Statement of Operations for the year ended December 31, 2018. |
Other accrued liabilities (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Accrued Liabilities | Other accrued liabilities consist of:
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Debt (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-Term Debt | Long-term debt consists of the following:
*Includes loan balances on term loan and revolver loan facility under the New First Lien Facility as of December 31, 2017. The revolver loan of $5.0 million was repaid during 2018. |
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Debt Instrument Redemption | The Issuer may redeem some or all of the outstanding Bonds at any time on or after the Interest Payment Date in May 2020 (the “First Call Date”), at the following redemption prices (expressed as a percentage of the nominal amount), plus accrued interest on the redeemed amount, on any business day from and including:
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Schedule Of Interest Expense | Interest Expense consisted of:
* The Exit Financing Facility was amended and restated on March 30, 2016 as a result of entering into the First Lien Facility. |
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Schedule of Maturities of Long-term Debt | The following table presents the scheduled maturities of principal amounts of our debt obligations for the next five years.
* The scheduled maturities exclude the impact of the refinancing of the New First Lien Facility and Original Ultraco Debt Facility on January 25, 2019. |
Derivative Instruments and Fair Value Measurements (Tables) |
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Non-Designated Derivative Instruments Effect on Statement of Operations | The effect of non-designated derivative instruments on the Consolidated Statements of Operations:
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Fair Value, by Balance Sheet Grouping | Assets and liabilities measured at fair value:
(1) Includes non-current restricted cash of $11.0 million at December 31, 2018 and $0.1 million at December 31, 2017.
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Commitments and Contingencies (Tables) |
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Commitments | The future minimum commitments under the leases for office space as of December 31, 2018 are as follows: (In thousands of U.S. dollars)
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Income/(Loss) per Common Share (Tables) |
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Dec. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted |
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Stock Incentive Plans (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Award Activity | The restricted stock and option were not granted under, but are subject to, the terms of the Company’s 2014 Plan. The details of the grant are below:
The following schedule represents outstanding stock awards and options granted under the 2016 Plan as of December 31, 2018.
*The above stock awards were issued concurrently with the cancellation of outstanding stock awards and options under the 2014 Plan. Therefore, the issuance was accounted for as a modification as per ASC 718 “Compensation-Stock Compensation.” The fair value is the incremental compensation cost, which was calculated as the excess of the fair value of the replacement award over the fair value of the cancelled award at the cancellation date. The amortization of the above stock awards was calculated using the graded method of vesting and included in general and administrative expenses. |
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Stock Options Activity | Amortization of the above stock awards was calculated using the cliff method of vesting and included in general and administrative expenses.
** The volatility was calculated by comparing the Company’s share price movement since emergence from bankruptcy on October 14, 2014 and its peers’ share price movement for the past five years. The amortization of these stock options was calculated using the graded method of vesting and included in general and administrative expenses.
*The volatility was calculated by comparing the Company’s share price movement since emergence from bankruptcy on October 14, 2014 and its peers’ share price movement for the past five years. **The above stock options were issued concurrently with cancellation of outstanding stock awards and options under the 2014 Equity Incentive Plan. Therefore, the transaction was accounted for as a modification as per ASC 718 “Compensation-Stock Compensation.” The fair value is the incremental compensation cost, which was calculated as the excess of the fair value of the replacement award over the fair value of the cancelled award at the cancellation date. The amortization of the above stock options was included in general and administrative expenses. |
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Schedule Of Noncash Compensation Expenses | The stock-based compensation expense for the above stock awards and options under the 2016 Plan and 2014 Plan included in General and administrative expenses:
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Quarterly Results of Operations (Unaudited) (Tables) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected Quarterly Financial Information | 2018
2017
* Net loss for the three months ended December 31, 2017 includes $15.0 million of loss on debt extinguishment. |
Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) |
3 Months Ended | 12 Months Ended | |||||||||
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Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
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Disaggregation of Revenue [Line Items] | |||||||||||
Revenues, net | $ 86,692,209 | $ 69,092,740 | $ 74,938,700 | $ 79,370,609 | $ 74,587,441 | $ 62,710,903 | $ 53,631,224 | $ 45,855,057 | $ 310,094,258 | $ 236,784,625 | $ 124,492,844 |
Time charters | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues, net | 140,006,570 | ||||||||||
Voyage charters | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues, net | $ 170,087,688 |
Significant Accounting Policies - Schedule of Effects of ASC 606 (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||||||||||
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Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Jan. 01, 2018 |
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New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Accounts receivable | $ 19,785,582 | $ 17,246,540 | $ 19,785,582 | $ 17,246,540 | $ 16,320,557 | |||||||
Other current assets | 2,246,740 | 785,027 | 2,246,740 | 785,027 | 1,581,535 | |||||||
Unearned charter hire revenue | 6,926,839 | 5,678,673 | 6,926,839 | 5,678,673 | 6,336,308 | |||||||
Revenues, net | 86,692,209 | $ 69,092,740 | $ 74,938,700 | $ 79,370,609 | 74,587,441 | $ 62,710,903 | $ 53,631,224 | $ 45,855,057 | 310,094,258 | 236,784,625 | $ 124,492,844 | |
Voyage expenses | 79,566,452 | 62,351,252 | 42,093,714 | |||||||||
Charter hire expenses | 38,045,778 | 31,283,956 | 12,845,468 | |||||||||
Net income/(loss) | $ 6,486,350 | $ 2,584,822 | $ 3,450,767 | $ 52,745 | $ (16,584,425) | $ (10,255,346) | $ (5,888,466) | $ (11,068,448) | $ 12,574,684 | $ (43,796,685) | $ (223,522,435) | |
Basic income (in dollars per share) | $ 0.09 | $ 0.04 | $ 0.05 | $ 0.00 | $ (0.24) | $ (0.15) | $ (0.08) | $ (0.17) | $ 0.18 | $ (0.63) | $ (10.87) | |
Diluted net income (in dollars per share) | $ 0.09 | $ 0.04 | $ 0.05 | $ 0.00 | $ (0.24) | $ (0.15) | $ (0.08) | $ (0.17) | $ 0.18 | $ (0.63) | $ (10.87) | |
Accumulated deficit | $ (415,377,239) | $ (427,164,813) | $ (415,377,239) | $ (427,164,813) | (427,951,923) | |||||||
Calculated under Revenue Guidance in Effect before Topic 606 | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Accounts receivable | 20,771,299 | 17,246,540 | 20,771,299 | 17,246,540 | ||||||||
Other current assets | 1,478,450 | 785,027 | 1,478,450 | 785,027 | ||||||||
Unearned charter hire revenue | 6,528,275 | 5,678,673 | 6,528,275 | 5,678,673 | ||||||||
Revenues, net | 309,894,921 | |||||||||||
Voyage expenses | 79,292,962 | |||||||||||
Charter hire expenses | 37,957,027 | |||||||||||
Net income/(loss) | $ 12,737,588 | |||||||||||
Basic income (in dollars per share) | $ 0.18 | |||||||||||
Diluted net income (in dollars per share) | $ 0.18 | |||||||||||
Accumulated deficit | (427,164,813) | (427,164,813) | ||||||||||
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Accounts receivable | (985,717) | (925,983) | $ (985,717) | (925,983) | ||||||||
Other current assets | 768,290 | 796,508 | 768,290 | 796,508 | 800,000 | |||||||
Unearned charter hire revenue | $ 398,564 | 657,635 | 398,564 | 657,635 | 1,600,000 | |||||||
Revenues, net | 199,337 | |||||||||||
Voyage expenses | 273,490 | |||||||||||
Charter hire expenses | 88,751 | |||||||||||
Net income/(loss) | $ (162,904) | |||||||||||
Basic income (in dollars per share) | $ 0.00 | |||||||||||
Diluted net income (in dollars per share) | $ 0.00 | |||||||||||
Accumulated deficit | $ (787,110) | $ (787,110) | $ (800,000) |
Vessels and vessel improvements - Schedule of Vessels and vessel improvements (Details) - USD ($) |
12 Months Ended | |
---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Movement in Property, Plant and Equipment [Roll Forward] | ||
Vessel and vessel improvements at the beginning of the year | $ 690,236,419 | |
Vessels and vessel improvements at the end of the year | 682,944,936 | $ 690,236,419 |
Vessels and Vessel Improvements | ||
Movement in Property, Plant and Equipment [Roll Forward] | ||
Vessel and vessel improvements at the beginning of the year | 690,236,419 | 567,592,950 |
Advance paid for vessel purchase | 2,201,773 | 1,926,886 |
Purchase of Vessels and vessel improvements | 41,487,795 | 174,400,746 |
Disposal of Vessels | (10,354,855) | (15,218,633) |
Reclassification to vessels held for sale | (8,458,444) | (9,316,095) |
Depreciation Expense | (32,167,752) | (29,149,435) |
Vessels and vessel improvements at the end of the year | $ 682,944,936 | $ 690,236,419 |
Short-term investment (Details) $ in Millions |
Dec. 31, 2017
USD ($)
|
---|---|
Investments, Debt and Equity Securities [Abstract] | |
Certificates of deposit | $ 4.5 |
Deferred Drydock Costs (Details) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Changes in Deferred Drydock Costs [Roll Forward] | |||
Beginning Balance | $ 9,749,751 | $ 11,507,309 | $ 11,146,009 |
Drydocking costs | 8,323,191 | 2,579,111 | 3,688,711 |
Drydock amortization | (5,353,102) | (4,336,669) | (3,327,411) |
Write-off due to sale of vessels | (533,484) | 0 | 0 |
Ending Balance | $ 12,186,356 | $ 9,749,751 | $ 11,507,309 |
Other accrued liabilities (Details) - USD ($) |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Other Accrued Liabilities [Line Items] | ||
Other accrued liabilities | $ 10,064,017 | $ 11,810,366 |
Vessel and voyage expenses | ||
Other Accrued Liabilities [Line Items] | ||
Other accrued liabilities | 4,981,596 | 5,373,389 |
General and administrative expenses | ||
Other Accrued Liabilities [Line Items] | ||
Other accrued liabilities | 4,768,244 | 6,050,078 |
Other expenses | ||
Other Accrued Liabilities [Line Items] | ||
Other accrued liabilities | $ 314,177 | $ 386,899 |
Debt - Scheduled Debt Maturities (Details) |
Dec. 31, 2018
USD ($)
|
---|---|
Debt Instrument [Line Items] | |
2019 | $ 29,176,230 |
2020 | 24,940,984 |
2021 | 24,940,984 |
2022 | 259,541,802 |
Long-term debt, gross | 338,600,000 |
Norwegian Bond Debt | |
Debt Instrument [Line Items] | |
2019 | 8,000,000 |
2020 | 8,000,000 |
2021 | 8,000,000 |
2022 | 172,000,000 |
Long-term debt, gross | 196,000,000 |
New First Lien Facility | |
Debt Instrument [Line Items] | |
2019 | 10,750,000 |
2020 | 8,600,000 |
2021 | 8,600,000 |
2022 | 32,050,000 |
Long-term debt, gross | 60,000,000 |
Ultraco Debt Facility | |
Debt Instrument [Line Items] | |
2019 | 10,426,230 |
2020 | 8,340,984 |
2021 | 8,340,984 |
2022 | 55,491,802 |
Long-term debt, gross | $ 82,600,000 |
Derivative Instruments and Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions |
Dec. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
FFAs | Other current assets | ||
Property, Plant and Equipment [Line Items] | ||
Cash collateral related to derivative instruments under its collateral security arrangements | $ 0.8 | $ 0.2 |
Commitments and Contingencies - Future Minimum Commitments Under Leases (Details) |
Dec. 31, 2018
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 715 |
2020 | 728 |
2021 | 708 |
2022 | 483 |
2023 | 245 |
Thereafter | 0 |
Total | $ 2,879 |
Income/(Loss) per Common Share - Narrative (Details) - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Warrants outstanding (in shares) | 3,040,540 | 3,040,540 | |
Number of securities called by warrants (in shares) | 152,027 | 152,027 | 152,027 |
Minimum price per share to exercise for first half of warrants (in dollars per share) | $ 556.40 | $ 556.40 | |
Term of warrants | 7 years | ||
Stock Compensation Plan | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 687 | 1,716,928 | 1,413,461 |
Employee Stock Option | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 348,625 | 2,301,046 | 1,942,909 |
Income/(Loss) per Common Share - Basic and Diluted (Details) - USD ($) |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Earnings Per Share [Abstract] | |||||||||||
Net income/(loss) | $ 6,486,350 | $ 2,584,822 | $ 3,450,767 | $ 52,745 | $ (16,584,425) | $ (10,255,346) | $ (5,888,466) | $ (11,068,448) | $ 12,574,684 | $ (43,796,685) | $ (223,522,435) |
Weighted Average Shares-Basic (in shares) | 70,665,212 | 69,182,302 | 20,565,652 | ||||||||
Dilutive effect of stock options and restricted stock units (in shares) | 1,136,961 | 0 | 0 | ||||||||
Weighted Average Shares - Diluted (in shares) | 71,802,173 | 69,182,302 | 20,565,652 | ||||||||
Basic income/(loss) (in dollars per share) | $ 0.09 | $ 0.04 | $ 0.05 | $ 0.00 | $ (0.24) | $ (0.15) | $ (0.08) | $ (0.17) | $ 0.18 | $ (0.63) | $ (10.87) |
Diluted net income/(loss) (in dollars per share) | $ 0.09 | $ 0.04 | $ 0.05 | $ 0.00 | $ (0.24) | $ (0.15) | $ (0.08) | $ (0.17) | $ 0.18 | $ (0.63) | $ (10.87) |
Stock Incentive Plans - Non-cash Compensation Expenses (Details) - USD ($) |
12 Months Ended | |||||
---|---|---|---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 9,207,480 | $ 8,738,615 | $ 2,206,690 | |||
Scenario, Forecast | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Non-cash compensation expense | $ 500,000 | $ 1,700,000 | $ 4,700,000 | |||
2016 and 2014 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Non-cash compensation expense | $ 9,207,480 | $ 8,738,615 | $ 2,206,690 |
Quarterly Results of Operations (Unaudited) (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 08, 2017 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||
Revenues, net | $ 86,692,209 | $ 69,092,740 | $ 74,938,700 | $ 79,370,609 | $ 74,587,441 | $ 62,710,903 | $ 53,631,224 | $ 45,855,057 | $ 310,094,258 | $ 236,784,625 | $ 124,492,844 | |
Total Operating expenses | 73,220,074 | 60,262,456 | 65,953,230 | 73,051,692 | 67,999,398 | 64,624,733 | 53,938,837 | 50,361,713 | 272,487,452 | 236,924,681 | 325,744,816 | |
Operating (loss)/income | 13,472,135 | 8,830,284 | 8,985,470 | 6,318,917 | 6,588,043 | (1,913,830) | (307,613) | (4,506,656) | 37,606,806 | (140,056) | (201,251,972) | |
Net income/(loss) | $ 6,486,350 | $ 2,584,822 | $ 3,450,767 | $ 52,745 | $ (16,584,425) | $ (10,255,346) | $ (5,888,466) | $ (11,068,448) | $ 12,574,684 | $ (43,796,685) | $ (223,522,435) | |
Basic income/(loss) (in dollars per share) | $ 0.09 | $ 0.04 | $ 0.05 | $ 0.00 | $ (0.24) | $ (0.15) | $ (0.08) | $ (0.17) | $ 0.18 | $ (0.63) | $ (10.87) | |
Diluted net income/(loss) (in dollars per share) | $ 0.09 | $ 0.04 | $ 0.05 | $ 0.00 | $ (0.24) | $ (0.15) | $ (0.08) | $ (0.17) | $ 0.18 | $ (0.63) | $ (10.87) | |
Loss on debt extinguishment | $ 11,800,000 | $ 15,000,000 | $ 0 | $ 14,968,609 | $ 0 |
Label | Element | Value | ||
---|---|---|---|---|
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (787,110) | ||
Retained Earnings [Member] | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (787,110) | ||
|
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