Exhibit 10.1

 

 

 

SUBJECT TO FRE 408

PRIVILEGED AND CONFIDENTIAL

 

 

 

THIRD LIMITED WAIVER TO THE LOAN AGREEMENT
AND
AMENDMENT NO. 6 TO
FORBEARANCE AND STANDSTILL AGREEMENT

 

This THIRD LIMITED WAIVER TO THE LOAN AGREEMENT (as defined below) AND AMENDMENT
NO. 6 TO THE FORBEARANCE AND STANDSTILL AGREEMENT (as defined below), dated as
of March 8, 2016 (this “Third Waiver and Amendment”), is by and among Eagle Bulk
Shipping Inc., a corporation incorporated and existing under the laws of the
Republic of the Marshall Islands (the “Borrower”), the companies party to the
Loan Agreement and the Forbearance Agreement as guarantors, each a limited
liability company formed and existing under the laws of the Republic of the
Marshall Islands (collectively, the “Guarantors” and, together with the
Borrower, the “Obligors”, and any one of them, individually, an “Obligor”), the
banks and financial institutions party to the Loan Agreement as “Lenders”
identified on the signature pages hereto and party to the Forbearance Agreement
as “Specified Lenders” (such parties, constituting the Majority Lenders under
and as defined in the Loan Agreement and all of the “Specified Lenders” under
and as defined in the Forbearance Agreement, collectively, the “Specified
Lenders”, and any one of them, individually, a "Specified Lender"), ABN AMRO
Capital USA LLC, as agent for the Lenders (in such capacity, the “Agent”), and
ABN AMRO Capital USA LLC, as security trustee for the Lenders (in such capacity,
the “Security Trustee” and together with the Agent, the Specified Lenders and
the Obligors, collectively, the “Parties”, and any one of them, individually, a
“Party”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrower, the Guarantors, the Specified Lenders, the other banks
and financial institutions party to the Loan Agreement as “Lenders”
(collectively, the “Lenders”, and together with the Agent and the Security
Trustee, collectively, the “Lender Parties”, and any one of them, individually,
a “Lender Party”), the Agent and the Security Trustee are parties to that
certain Loan Agreement dated as of October 9, 2014 and as amended by an
Amendatory Agreement dated as of August 14, 2015 (as so amended and as the same
may be amended, restated, supplemented or otherwise modified from time to time,
the “Loan Agreement”); and

 

WHEREAS, the Borrower, the Guarantors and the Specified Lenders are party to
that certain Forbearance and Standstill Agreement, dated as of January 15, 2016
(as heretofore amended, restated, supplemented or otherwise modified and in
effect prior to the date hereof, including by (i) that certain Amendment No. 1
to Forbearance and Standstill Agreement, dated as of February 1, 2016, (ii) that
certain Limited Waiver to the Loan Agreement and Amendment No. 2 to Forbearance
and Standstill Agreement (the “First Waiver and Amendment”), dated February 9,
2016, and (iii) that certain Amendment No. 3 to Forbearance and Standstill
Agreement, dated as of February 22, 2016, (iv) that certain Second Limited
Waiver to the Loan Agreement and Amendment No. 4 to Forbearance and Standstill
Agreement (the “Second Waiver and Amendment”), dated as of February 29, 2016 and
(v) that certain Amendment No. 5 to Forbearance and Standstill Agreement, dated
as of March 6, 2016, the “Existing Forbearance Agreement” and as modified and
amended hereby and as may be further amended, restated, supplemented or
otherwise modified from time to time, the “Forbearance Agreement”); and

 

 
 

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WHEREAS, pursuant to the First Waiver and Amendment and the Second Waiver and
Amendment, the Agent, on behalf of and with the approval of the Majority
Lenders, and the Agent and the Security Trustee in their own right, granted a
temporary, limited waiver of the provisions of Clause 12.4 of the Loan Agreement
(such clause, the “Minimum Liquidity Covenant”);

 

WHEREAS, the Borrower has requested that the Agent, on behalf of and with the
approval of the Majority Lenders, and the Agent and the Security Trustee in
their own right, grant a further temporary, limited waiver of the Minimum
Liquidity Covenant and certain temporary, limited waivers of Clause 11.1 of the
Loan Agreement, each on the terms and conditions set forth herein; and

 

WHEREAS, the Obligors have requested that the Specified Lenders make certain
amendments to the Existing Forbearance Agreement on the terms and subject to the
conditions set forth herein; and

 

WHEREAS, the Agent, the Security Trustee and the Specified Lenders have agreed
to grant such waiver and make such amendments, as applicable, solely upon the
terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereby agree as follows:

 

1.       Defined Terms. Unless otherwise defined herein, terms defined in the
Existing Forbearance Agreement or the Loan Agreement and used herein shall have
the respective meanings given to them in the Existing Forbearance Agreement or
the Loan Agreement, as applicable.

 

2.       Amendment to Recital Paragraph of the Existing Forbearance Agreement.
The date of “March 8, 2016” set forth in the sixth recital paragraph of the
Existing Forbearance Agreement is hereby deleted in its entirety and “March 22,
2016” is inserted in lieu thereof.

 

3.       Limited Waivers. Each of the Agent, on behalf of and with the approval
of the Majority Lenders, and the Agent and the Security Trustee in their own
right, temporarily waives the following:

 

(a)     with respect to Clause 11.1(g)(i), (ii) or (iv) of the Loan Agreement
(i) the requirement to deliver any financial statement or Compliance Certificate
(including, for the avoidance of doubt, with respect to the minimum required
security cover under Clause 15.2 of the Loan Agreement) with respect to the
Fiscal Year ended December 31, 2015, until the date that is 120 days after the
end of such Fiscal Year and (ii) the requirement, if any, to deliver any
financial statement or Compliance Certificate (including, for the avoidance of
doubt, with respect to the minimum required security cover under Clause 15.2 of
the Loan Agreement) with respect to the quarter ended December 31, 2015;
provided, that such waivers shall cease effective immediately, without
requirement of any demand, presentment, protest of any kind, all of which each
of the Obligors hereby waives, upon the Termination Date (as defined in the
Forbearance Agreement);

 

 
 

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(b)     Clause 11.1(z) of the Loan Agreement; provided, that such waiver shall
cease effective immediately, without requirement of any demand, presentment,
protest of any kind, all of which each of the Obligors hereby waives, upon the
Termination Date (as defined in the Forbearance Agreement); and

 

(c)     Clause 12.4 of the Loan Agreement; provided, that such waiver shall
cease effective immediately, without requirement of any demand, presentment,
protest of any kind, all of which each of the Obligors hereby waives, upon the
earlier of (i) the occurrence of the Termination Date (as defined in the
Forbearance Agreement) and (ii) the Borrower’s failure, at any time, to maintain
Liquidity, including all amounts on deposit with any bank, of not less than the
greater of (x) $8,500,500 and (y) $193,193 per Ship (the “Temporary Minimum
Liquidity”); provided, further, that (A) at least 35.30% of the Temporary
Minimum Liquidity shall consist of cash held in the Liquidity Account, other
than any Interest Coverage Cure Amount, and (B) not more than 64.70% of the
Temporary Minimum Liquidity may be in the form of Cash Equivalents or undrawn
credit lines of one or more Security Parties, in each case, with remaining
maturity of at least 1 year (excluding the Revolving Credit Facility). For
avoidance of doubt, (i) the availability under the Revolving Credit Facility can
be used for the Temporary Minimum Liquidity calculation subject to the
limitations set forth in the preceding sentence and (ii) the waiver in the
preceding sentence shall amend, restate and supersede in its entirety the waiver
set forth in Section 3 of the First Waiver and Amendment and the waiver set
forth in Section 3 of the Second Waiver and Amendment.

 

Each of the Specified Lenders party hereto, collectively representing at least
the Majority Lenders, hereby authorize and direct the Agent and the Security
Trustee to execute, deliver and comply with the provisions of this Third Waiver
and Amendment.

 

4.       Representations and Warranties. Each Obligor hereby represents and
warrants to the Lender Parties as of the date hereof as follows:

 

(a)     Such Obligor (i) is duly incorporated or formed and validly existing and
in good standing under the law of its jurisdiction of incorporation or formation
and (ii) is duly qualified and in good standing as a foreign company in each
other jurisdiction in which it owns or leases property or in which the conduct
of its business requires it to so qualify or be licensed except where, in each
case, the failure to so qualify or be licensed and be in good standing could not
reasonably be expected to have a Material Adverse Effect or which may affect the
legality, validity, binding effect or enforceability of this Third Waiver and
Amendment or the Forbearance Agreement.

 

(b)     Such Obligor has the capacity and has taken all action, if applicable,
and no consent of any person is required, for it to execute this Third Waiver
and Amendment and to comply with its obligations hereunder. This Third Waiver
and Amendment has been duly executed and delivered on behalf of each Obligor.

 

 
 

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(c)     This Third Waiver and Amendment constitutes the legal, valid and binding
obligations of each Obligor enforceable against it in accordance with their
respective terms, subject to any relevant insolvency laws affecting creditors’
rights generally.

 

(d)     The execution of this Third Waiver and Amendment by each Obligor and
compliance by each Obligor herewith will not result in a contravention of (i)
any law or regulation, (ii) the constitutional documents of any Obligor or (iii)
any contractual or other obligation or restriction which is binding on any
Obligor or any of its assets.

 

(e)     Other than the Specified Defaults, no Potential Event of Default or
Event of Default has occurred and is continuing as of the date hereof.

 

5.       Reaffirmation and Grant of Security Interests; Reaffirmation of
Guarantee.

 

(a)     Each Obligor has created Security Interests in favor of the Security
Trustee, on behalf of the Lenders and the Swap Banks, on the Collateral as
provided in the Finance Documents. Each Obligor hereby acknowledges that it has
reviewed the terms and provisions of this Third Waiver and Amendment and
confirms that each Finance Document to which it is a party (or is otherwise
bound by) and all Collateral encumbered thereby will continue to guarantee or
secure to the fullest extent possible in accordance with the Finance Documents
and applicable law, the payment and performance of the Secured Liabilities.

 

(b)     Each Obligor acknowledges and agrees that, except as expressly set forth
in this Third Waiver and Amendment and the Forbearance Agreement, any of the
Finance Documents to which it is a party or is otherwise bound by shall continue
in full force and effect and that all of its obligations thereunder shall be
legal, valid and binding obligations of each Obligor, enforceable against such
Obligor in accordance with their terms, subject to any relevant insolvency laws
affecting creditors’ rights generally, and shall not be impaired or limited by
the execution or effectiveness of this Third Waiver and Amendment or the
Forbearance Agreement.

 

(c)     By executing this Third Waiver and Amendment, each Guarantor hereby
acknowledges, consents and agrees that all of its obligations and liabilities
under the provisions of each Finance Document to which it is a party remain in
full force and effect, and that the execution and delivery of this Third Waiver
and Amendment and the Forbearance Agreement and any and all documents executed
in connection herewith or therewith shall not alter, amend, reduce or modify any
of its obligations or liabilities under Clause 16 of the Loan Agreement or any
other provision of any Finance Documents to which it is a party.

 

 
 

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6.       No Waivers. Other than the First Waiver and Amendment, the Second
Waiver and Amendment, this Third Waiver and Amendment and the Forbearance
Agreement, no settlement, agreement or understanding (A) entered into with
respect to the Finance Documents or (B) purporting to amend, modify or qualify
the Finance Documents or to waive any rights or obligations set forth therein
shall constitute a legally binding agreement or contract, or have any force or
effect whatsoever, unless and until signed, or specifically agreed, pursuant to
the terms and conditions of Clause 28.1 of the Loan Agreement.

 

7.       Effectiveness; Conditions Precedent. This Third Waiver and Amendment
shall become effective on the date on which each of the Borrower, each of the
Guarantors, each of the Specified Lenders constituting the Majority Lenders, the
Agent and the Security Trustee shall have executed and delivered a copy hereof.

 

8.       Release. Each Obligor, each Obligor’s respective successors-in-title,
legal representatives, and assignees and, to the extent the same is claimed by
right of, through, or under any Obligor, their past, present, and future
employees, agents, representatives, officers, directors, shareholders, and
trustees, do hereby forever remise, release, and discharge each Lender Party,
and each Lender Party’s respective successors-in-title, affiliates,
subsidiaries, legal representatives, and assignees, past, present, and future
officers, directors, shareholders, trustees, agents, employees, consultants,
experts, advisors, attorneys, and other professionals (collectively, the “Lender
Group”), from any and all manner of action and actions, cause and causes of
action, defenses, counterclaims, setoffs, suits, debts, dues, sums of money,
accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, damages, judgments, expenses, executions, liens, claims of liens,
claims of costs, penalties, attorneys’ fees, or any other compensation,
recovery, or relief (including subordination of claims) (collectively, “Claims”)
on account of any loss, liability, obligation, demand, or cause of action of
whatever nature relating to, arising out of, or in connection with the Loan
Agreement or any other Finance Document, including, but not limited to, acts,
omissions to act, actions, negotiations, discussions, and events resulting in
the finalization and execution of this Third Waiver and Amendment or the
Forbearance Agreement, as, among, and between the Obligors and the Lender
Parties, such Claims whether now accrued and whether now known or hereafter
discovered, from the beginning of time through the date hereof, and specifically
including, without any limitation, any claims of liability asserted or that
could have been asserted with respect to, arising out of, or in any manner
whatsoever connected directly or indirectly with any “lender liability-type”
claim.

 

9.       No Challenge. The Obligors agree that their obligations under the
Finance Documents, this Third Waiver and Amendment and the Forbearance Agreement
are legal, valid and binding obligations of each Obligor, enforceable against
such Obligor in accordance with their terms, subject to any relevant insolvency
laws affecting creditors’ rights generally.

 

10.      Miscellaneous.

 

(a)     The provisions of this Third Waiver and Amendment shall inure to the
benefit of and be binding upon the Parties and their respective successors and
assigns (as and to the extent assignment is permitted in accordance with the
Forbearance Agreement and the Loan Agreement), and shall be governed by the laws
of the State of New York, without giving effect to the principles of conflicts
of law thereof. This Third Waiver and Amendment is a Finance Document. The terms
of this Third Waiver and Amendment may not be changed, waived, discharged, or
terminated orally, but only by an instrument or instruments in writing, signed
by the Party sought to be bound. This Third Waiver and Amendment may be executed
in one or more counterparts, each of which shall constitute an original. Each
Party executing this Third Waiver and Amendment represents and warrants that it
has the authority to do so and that the person signing on behalf of each Party
has been authorized to do so.

 

 
 

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(b)     Each of the Borrower and each Guarantor hereby irrevocably and
unconditionally submits to the exclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in New York
County, and any appellate court thereof, in any action or proceeding arising out
of or relating to this Third Waiver and Amendment, and each of the Borrower and
each Guarantor hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State Court or, to the extent permitted by law, in such Federal court.

 

(c)     This Third Waiver and Amendment shall not constitute a binding agreement
unless and until all conditions precedent to the effectiveness of this Third
Waiver and Amendment have been met.

 

(d)     Unless expressly stated herein, this Third Waiver and Amendment shall be
solely for the benefit of the Parties and no other person or entity shall be a
third party beneficiary hereof.

 

 

 

[Signature Pages Follow]

 

 
 

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IN WITNESS WHEREOF, the Parties have caused this Third Waiver and Amendment to
be duly executed and delivered as of the date first above written.

 

 

 

 

  EAGLE BULK SHIPPING INC., a corporation    

incorporated and existing under the laws of the

Republic of the Marshall Islands, as Borrower

                 

 

By:

/S/ Adir Katzav                                

 

 

Name: Adir Katzav

 

 

Title: Chief Financial Officer

 

 

 

 

[Signature Page to Limited Waiver and Amendment No. 6]

 

 
 

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Avocet Shipping LLC

Bittern Shipping LLC

Canary Shipping LLC

Cardinal Shipping LLC

Condor Shipping LLC

Crane Shipping LLC

Crested Eagle Shipping LLC

Crowned Eagle Shipping LLC

Egret Shipping LLC

Falcon Shipping LLC

Gannet Shipping LLC

Golden Eagle Shipping LLC

Goldeneye Shipping LLC

Grebe Shipping LLC

Harrier Shipping LLC

Hawk Shipping LLC

Ibis Shipping LLC

Imperial Eagle Shipping LLC

Jaeger Shipping LLC

Jay Shipping LLC

Kestrel Shipping LLC

Kite Shipping LLC

Kittiwake Shipping LLC

Kingfisher Shipping LLC

Martin Shipping LLC

Merlin Shipping LLC

Nighthawk Shipping LLC

Oriole Shipping LLC

Osprey Shipping LLC

Owl Shipping LLC

Peregrine Shipping LLC

Petrel Shipping LLC

Puffin Shipping LLC

Redwing Shipping LLC

Roadrunner Shipping LLC

Sandpiper Shipping LLC

Shrike Shipping LLC

Skua Shipping LLC

Sparrow Shipping LLC

Stellar Eagle Shipping LLC

Tern Shipping LLC

Thrasher Shipping LLC

Thrush Shipping LLC

Woodstar Shipping LLC

Wren Shipping LLC, as Guarantors

          By:  /S/ Adir Katzav
Name: Adir Katzav
Title: Attorney-in-fact

 

 

 

 

[Signature Page to Limited Waiver and Amendment No. 6]

 

 
 

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