INTERNATIONAL SEAWAYS, INC. : Termination of a material definitive agreement, creation of a direct financial obligation or obligation under an off-balance sheet arrangement of a holder, other events (Form 8-K)

Item 1.02 Termination of a Material Definitive Agreement.

At November 12, 2021, International Seaways, Inc. (“INSW” or the “Company”) and WLR / TRF Shipping Sarl (“WLR / TRF”) contested the dissolution of the NT Suez Holdco LLC (“NT Suez”), which prior to dissolution was 51% owned by the Company and 49% owned by WLR / TRF, and reimbursed all outstanding amounts under a $ 66 million a five-year senior secured term loan facility (the “NT Suez Facility”) previously entered into by NT Suez with lenders hereunder for the purpose of financing the two Suezmax tankers controlled by NT Suez. See section 8.01 for more information.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under a

           Off-Balance Sheet Arrangement of a Registrant.



Information included in Item 8.01 is incorporated by reference in this Item 2.03.


 Item 8.01 Other Events.




(A) Dissolution of the NT Suez joint venture, loan repayment and entry into credit

     Facility



At November 12, 2021, the Company and WLR / TRF finalized the dissolution of the NT Suez joint venture, initially incorporated as september 2014 to buy two new Suezmax buildings (the Loire and the Namsen), which were delivered to NT Suez in the third quarter of 2016. The dissolution resulted in the distribution of one Suezmax tanker to each partner via a transfer of the shares of the two ship-owner subsidiaries of NT Suez. Following the dissolution, the Company holds the entire interest in NT Suez One LLC, the entity that owns the Loire and WLR / TRF owns all interests in NT Suez Two LLC, the entity that owns the Namsen.

Also on November 12, 2021, the Company, as well as its indirect subsidiaries
Diamond S Shipping Inc. (jointly with the Company, the “Guarantors”) and NT Suez One LLC (the “Borrower”), entered into a credit agreement (the “Credit Agreement”) for a $ 25 million term credit facility with ING Bank NV, London
Branch, as lender, administrative agent, guarantee agent and security trustee. The Credit Agreement is guaranteed by a first lien on the Loire, as well as its income, insurance and certain other assets. Full $ 25 million was shot November 12, 2021. Interest on the loan is based on LIBOR plus a margin of 2% per annum. The loan is amortized in quarterly installments of approximately $ 0.5 million starting in February 2022 and matures on the fifth anniversary of the borrowing date in November 2026 (with a final lump sum payment due at maturity of an amount equal to the amount of the principal remaining on the loan outstanding at that date). The due date is subject to acceleration upon the occurrence of certain events (as described in the credit agreement).

The Credit Agreement contains customary representations, warranties, restrictions and covenants applicable to the Guarantors and their respective subsidiaries (including the Borrower). These include financial covenants aligned with the Company’s existing senior secured debt facilities and require, among other things, that the Company maintain a minimum level of liquidity; not to exceed a maximum consolidated leverage ratio; ensure that current assets exceed current liabilities; and ensure that the fair market value of the vessel is not less than 135% of the total principal amount outstanding on the loan under the credit agreement, in each case as further detailed in the credit agreement.

The Company used substantially all of the proceeds of the loan under the credit agreement to repay approximately half of the amount outstanding under the NT Suez facility (approximately $ 22 million). The installation of NT Suez was due to expire on November 18, 2021. The outstanding amount has been reimbursed by WLR-TRF. The Company will use any remaining loan proceeds under the Credit Agreement (after fees and expenses) for general business purposes.

(B) Sale and leaseback transactions relating to the new construction of dual fuel LNG VLCCs

     Tankers



At November 15, 2021, the Company and three of its indirect vessel-owning subsidiaries have entered into a series of sale-leaseback agreements with entities affiliated with the Bank of Communications Limited (“BoComm”) in connection with the construction of three new dual-fuel VLCC LNG tankers. Delivery of the three new builds is currently scheduled for the first quarter of 2023. BoComm’s obligation to provide financing in accordance with the terms of the sale-leaseback agreements begins once construction of the first vessel begins upon completion. November 2021. The transactions are expected to end up providing funding of approximately $ 245 million in total during the construction and delivery of the three vessels. The bareboat charter leases for the three VLCC tankers have a term of seven years from the date the vessels are delivered from the shipyard where they are built, and include purchase options and other usual terms and conditions for sale-leaseback transactions.

© Edgar online, source Previews


Source link

Comments are closed.