NYSE-listed dry bulk shipping company Safe Bulkers, Inc. has agreed with the Royal Bank of Scotland to amend certain financial covenants and terms to an existing term loan facility with an outstanding balance of USD 73.4 million.
According to the amendment, the total consolidated liabilities of Safe Bulkers divided by its total consolidated assets charter inclusive must not exceed 90% until and including year-end 2017 and 85% from 2018 onwards. The new deal also states that the ratio of the company’s EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) to its interest expense must be not less than 2:1 on a trailing 12 month basis, applicable from 2018 onwards.
The parties have also agreed that the consolidated net worth of Safe Bulkers, defined as total consolidated assets charter inclusive less total consolidated liabilities, is waived until and including year-end 2017 and not less than USD 105 million from 2018 onwards. Also, the aggregate market value of the vessels under the facility divided by the aggregate outstanding loan value must exceed 110% until year-end 2017 and 120% from 2018 onwards.
In addition, Safe Bulkers has agreed to have the option for a new repayment schedule according to which the company will repay additional USD 1.9 million of debt by the end of 2016 and defer USD 7.6 million of debt repayment originally due in 2017 and 2018 to years after 2019.
“The agreement with RBS is the fifth in a row which provides for alignment of financial covenants and deferral of about USD5.7 million of debt originally payable until 2018, to years after 2019. With this agreement, the amended facilities represent about 76% of our debt, excluding sale and lease back financing arrangements and debt from State institutions,” Dr. Loukas Barmparis, President of Safe Bulkers, said.