Company: ASC
Filing Date: 2025-03-07
Form Type: 20-F
Source: 0001558370-25-002500
Chunk: 12

Company: Ardmore Shipping Corp
Filing Date: 2025-03-07
Form: 20-F
Item: Item 3
Chunk 12
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 or the delay or cancelation of existing projects as energy companies lower their capital expenditure...  
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  potential lower demand for tankers, which may reduce available charter rates and revenue to us upon chartering or rechartering of our vessels;  
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  customers failing to extend or renew contracts upon expiration;  

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  the inability or refusal of customers to make charter payments to us due to financial constraints or otherwise; or  

  declines in vessel values, which may result in losses to us upon vessel sales or impairment charges against our earnings.  
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Volatility in the markets in which our vessels trade may result in us having limited liquidity.

As of December 31, 2024 we had $243.4 million in liquidity available, with cash and cash equivalents of $47.0 million and amounts available and undrawn under our revolving credit facilities of $196.4 million. Our short-term liquidity requirements include the payment of operating expenses, drydocking expenditures, debt servicing costs, operating lease payments, dividends on our shares of preferred stock, dividends on our shares of common stock and scheduled repayments of long-term debt, as well as funding our other working capital requirements. Our short-term and spot charters contribute to the volatility of our net operating cash flow, and thus our ability to generate sufficient cash flows to meet our short-term liquidity needs. We expect to manage our near-term liquidity needs from our working capital, together with expected cash flows from operations and availability under credit facilities.

Our existing long-term debt facilities require, among other things, that we maintain minimum cash and cash equivalents based on the greater of a set amount per number of vessels owned and 5% of outstanding debt.

The required minimum cash balance as of December 31, 2024, was $18.75 million. Should we not meet this financial covenant or other covenants in our debt facilities, whether due to market volatility that reduces our liquidity or other factors, the lenders may declare our obligations under the applicable agreements immediately due and payable, and terminate any further loan commitments, which would significantly affect our short-term liquidity requirements. A default under financing arrangements could also result in foreclosure on any of our vessels and other assets