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Republic
of the Marshall Islands
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000-28506
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98-043-9758
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(State
or Other Jurisdiction
of
incorporation)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
No.)
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299
Park Avenue
20th
Floor
(Address
of Principal Executive Offices)
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10171
(Zip
Code)
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·
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The
Lenders will permit Genco to transfer securities owned by Genco to
a
subsidiary.
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·
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Genco
will no longer be required to make a prepayment from Net Cash Flow
(as
defined in the Credit Agreement) following the quarter ending September
30, 2007. For subsequent quarters, Genco instead will be
required to make prepayments of $6,250,000 prior to the declaration
of any
dividend, subject to the same provisions as were originally applicable
to
the prepayments from Net Cash Flow.
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·
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The
Applicable Margin to be added to the London Interbank Offered Rate
to
calculate the rate at which Genco’s borrowings bear interest will be
increased by 0.10% to 0.90% per annum for the first five years of
the new
credit facility and 0.95% thereafter. Similarly, if Genco’s
ratio of Total Debt to Total Capitalization (each as defined in the
Credit
Agreement) is less than 70%, the Applicable Margin will decrease
to 0.85%
and 0.90%, respectively.
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Item
2.03.
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Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a
Registrant.
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Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment
of
Certain Officers; Compensatory Arrangements of Certain
Officers.
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Estimated
Daily Expenses by Category
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Net
Income
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|||
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Direct
Vessel Operating(2)
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$ |
3,800
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General
& Administrative(3)
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1,779
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Management
Fees(4)
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243
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Interest
Expense (5)
(Breakeven
figures include a non-cash $3.6 million deferred financing charge
related
to the retirement of Genco’s previous credit facility)
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5,639
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|||
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Depreciation(6)
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4,460
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Estimated
Daily Break-Even(7)
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$ |
15,921
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(1)
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Calculations
for breakeven levels are based on an average number of vessels
of 19.84
vessels for the third quarter of
2007.
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(2)
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Direct
Vessel Operating Expenses is based on management’s estimates and budgets
submitted by our technical managers. Genco believes DVOE are
best measured for comparative purposes over a 12-month
period. Genco expects higher crewing costs, lube-oil costs and
drydocking costs.
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(3)
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General
& Administrative amounts are based on a budget and may vary, including
as a result of actual employee incentive
compensation.
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(4)
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Management
Fees are based on the contracted monthly rate per vessel for the
technical
management of our fleet.
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(5)
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Interest
Expense is based on our debt level as of June 30, 2007 of $206.2
million
outstanding, unused commitment fees, and amortization of deferred
financing costs. Of the outstanding amount of $720.1 million, $106.2
million is calculated based on our fixed swap rate of 4.485% plus
the
applicable margin, $50 million is calculated based on our fixed swap
rate
of 5.25% plus the applicable margin, and the remaining is calculated
based
on an assumed LIBOR rate of 5.44% plus the applicable margin.
Additionally, there was a drawdown of $178.25 million on July 24,
2007
related to the deposits on the 9 Capesize vessel acquisition, a drawdown
of $225 million for the payment of 90% of the price for the Genco
Augustus, and Genco Tiberius, the two vessels delivered during the
third
quarter of 2007and the drawdown of $33.6 million on August 14, 2007
for
the deposit of the Evalend 6 vessel acquisition. Interest expense
for the
additional drawdowns is calculated at LIBOR plus the applicable
margin. Additionally, Genco pays a commitment fee for the
unused portion of the credit facility. Genco also entered into
a new credit facility in July 20, 2007 under which if Total Debt
to Total
Capitalization is below 70%, then margins over LIBOR would be 0.75%
and
0.80% if it is over 70%. From and after September 21, 2007, the
applicable margins over LIBOR under this test will be 0.85% and 0.90%,
respectively. Prior to the new credit facility, the margin was
0.95%. Genco incurred a non-cash expense of $3.6 million due to
the write-off of deferred financing costs in the third quarter of
2007 for
the retirement of the previous credit facility. Any interest expense
associated with the deposits on new-building vessels will be capitalized
as part of the vessel acquisition.
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(6)
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Depreciation
is based primarily on the purchase price of the current fleet and
amortization of dry docking costs.
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(7)
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The
amounts shown will vary based on actual
results.
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Vessel
Type
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Vessel
Name
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DWT
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Yard
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Delivery
(1)
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Year
Built (1)
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Charterer
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Duration/
Expiration
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Cash
Daily
Rate
(2)
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Revenue
Daily Rate
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Capesize
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Genco
Augustus
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180,000
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Imabari
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Aug
17 2007
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2007
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Cargill
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35
to 39 Mos
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45,263
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62,750
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Genco
Tiberius
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175,000
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Universal
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Aug
17 2007
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2007
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Cargill
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35
to 39 Mos
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45,263
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62,750
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Genco
London
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177,000
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SWS
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Sep
28 2007
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2007
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SK
Shipping
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35
to 39 Mos
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57,500
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64,250
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Genco
Titus
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177,000
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SWS
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Q4
2007
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2007
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Cargill
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48
to 62 Mos
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45,000(4)
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46,250
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Supramax
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Genco
Predator
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55,435
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Nantong
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Q4
2007
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2005
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Intermare
Transport GMBH
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January
2008
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22,500
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41,000(3)
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(1)
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Built
dates and delivery dates for vessels delivering in the future are
estimates based on guidance from the sellers and respective
shipyards.
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(2)
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Time
charter rates presented are the gross daily charterhire rates before
the
payments of brokerage commissions ranging from 2.50% to 5.00% to
third
parties. In a time charter, the charterer is responsible for
voyage expenses such as bunkers, port expenses, agents’ fees and canal
dues.
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(3)
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Since
this vessel was acquired with an existing time charter at a below-market
rate, we allocated the purchase price between the vessel and an intangible
liability for the value assigned to the below-market
charterhire. This intangible liability is amortized as an
increase to voyage revenues over the minimum remaining term of the
charter. The net income daily rate recognized as revenues is
displayed in the column named “Net Income Rate” and is net of any
third-party commissions. For cash flow purposes, we will
continue to receive the rate presented in the “Cash Rate” column until the
charter expires.
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(4)
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The
charter includes a 50% capesize index-based profit sharing component
which
is not included in the base presented and is described in Genco’s Form 8-K
filed on September 6, 2007.
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Item
9.01
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Financial
Statements and Exhibits.
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10.1
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Amendment
and Supplement No. 1 to Senior Secured Credit Agreement, dated as
of
September 21, 2007, among Genco Shipping & Trading Limited, the
lenders party thereto, and DNB NOR Bank ASA, New York Branch, as
Administrative Agent.
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10.2
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Letter
Agreement, dated September 21, 2007, between Genco Shipping & Trading
Limited and John C. Wobensmith.
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10.1
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Amendment
and Supplement No. 1 to Senior Secured Credit Agreement, dated
as of
September 21, 2007, among Genco Shipping & Trading Limited, the
lenders party thereto, and DNB NOR Bank ASA, New York Branch, as
Administrative Agent.
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10.2
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Letter
Agreement, dated September 21, 2007, between Genco Shipping & Trading
Limited and John C.
Wobensmith.
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