Document:

Exhibit 10.1

 

EXECUTION VERSION

 

FORBEARANCE AGREEMENT (SECOND)

 

This Forbearance Agreement (Second) (this “Agreement”) dated as of April 1, 2014  by and among Wilmington Trust, National Association (as successor Administrative Agent and successor Collateral Agent, in such capacities, individually and collectively, the “Agent”) under the Credit Agreement (as defined below), Genco Shipping & Trading Limited (the “Borrower”), the other Credit Parties (as defined in the Credit Agreement, and together with the Borrower, “Genco”), and the Lenders executing this Agreement on the signature pages hereto.

 

Reference is made to the Credit Agreement dated as of July 20, 2007 among the Borrower, various Lenders party thereto, and the Agent (as successor to DNB Nor Bank ASA, New York Branch (n/k/a DNB Bank ASA, New York Branch, as original administrative agent and original collateral agent) (as amended, modified and supplemented from time to time, the “Credit Agreement”). Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed thereto in the Credit Agreement.

 

Genco has requested that the Lenders party hereto (collectively, the “Lender Group”), which constitute the Required Lenders, and the Agent forbear from exercising any of their respective rights and remedies, including, without limitation, accelerating any Obligations or terminating any Commitments, whether under the Credit Agreement or any other Credit Document (including, without limitation, under any control agreement or similar agreement or documents relating to any deposit or securities account of any Credit Party (each, a “Control Agreement”) or in respect of any deposit or securities account) , for the period of time set forth herein and subject to the terms and conditions hereof, solely with respect to the following existing, expected or anticipated Events of Default (collectively, the “Specified Defaults”):  (i) the failure of the Borrower to make the scheduled repayment and commitment reduction on March 31, 2014 in accordance with Section 3.04(iii) of the Credit Agreement, (ii) the failure of the Borrower to meet the Consolidated Interest Coverage Ratio specified for the Test Period ending March 31, 2014, as required under Section 11.07 of the Credit Agreement, (iii) the failure of the Borrower to meet the Leverage Ratio specified for the Test Period ending March 31, 2014, as required under Section 11.08 of the Credit Agreement, (iv) the failure of the Borrower to meet the minimum Aggregate Appraised Value required under Section 11.09 of the Credit Agreement, (v) the failure of the Borrower to meet the minimum amount of cash and Cash Equivalents and undrawn credit facilities held by the Borrower as of March 31, 2014, as required under Section 11.10 of the Credit Agreement, (vi) the cross-default with existing Interest Rate Protection Agreements or Other Hedging Agreements under Section 12.04(ii) of the Credit Agreement resulting from the Specified Defaults set forth in clauses (i) through (v) above and the cross-default relating to defaults under the Other Credit Agreements (as defined in clauses (i) and (ii) of such definition), (vii) the cross-default with the Other Credit Agreements (as defined in clauses (i) and (ii) of such definition) under Section 12.04(ii) of the Credit Agreement resulting from the Specified Defaults set forth in clauses (i) through (v) above, (viii) the failure of the Borrower to deliver its annual audited financial statements (and the report of the accounting firm required to be delivered together with such financial statements) within 90 days after the close of the fiscal year ending on December 31, 2013, in accordance with Section 10.01(b) of the Credit Agreement and (ix) any related Default or Event of Default which would result from the failure to give notice with respect to any of the foregoing.

 

The Lender Group is willing to, and hereby directs the Agent to, for the period of time set forth herein and subject to the terms and conditions hereof, so forbear solely with respect to the Specified Defaults.

 

 

In consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Borrower, the Agent and the Lender Group hereby agree as follows:

 

Section 1  Acknowledgments and Agreements; Limited Forbearance in Respect of Specified Defaults.

 

1.01.  Acknowledgement of Default.  To induce the Agent and the Lenders to execute this Agreement, Genco hereby acknowledges, stipulates, represents, warrants and agrees as follows:

 

1.01.1.  Each Specified Default constitutes an Event of Default that has occurred or is expected to occur.  Except for the Specified Defaults, no other Default or Event of Default has occurred and is continuing as of the date hereof, or to the best of its knowledge are expected to occur prior to the end of the Forbearance Period (as defined below).  Except as expressly set forth in this Agreement, the agreements of the Agent and the Lender Group hereunder to forbear in the exercise of their respective rights and remedies under the Credit Documents in respect of the Specified Defaults during the Forbearance Period (as defined below) do not in any manner whatsoever limit any right of any of the Agent and the Lenders to insist upon strict compliance with this Agreement or any Credit Document during the Forbearance Period.

 

1.01.2.  Nothing has occurred that constitutes or otherwise can be construed or interpreted as a waiver of, or otherwise to limit in any respect, any rights or remedies any of the Lenders or the Agent have or may have arising as the result of any Event of Default (including any Specified Default) that has occurred or that may occur under the Credit Agreement, the other Credit Documents or applicable law.  The Agent’s and the Lender Group’s actions in entering into this Agreement are without prejudice to the rights of any of the Agent and the Lenders to pursue any and all remedies under the Credit Documents pursuant to applicable law or in equity available to it in its sole discretion upon the termination (whether upon expiration thereof, upon acceleration or otherwise) of this Agreement.

 

1.01.3.  The aggregate outstanding principal amount of the Loans as of March 31, 2014 is equal to $1,055,911,525.00.  The foregoing amounts do not include interest, fees (including the 1.25% facility fee payable pursuant to the Amendment and Supplement No. 6 to the Credit Agreement), expenses and other amounts that are chargeable or otherwise reimbursable under the Credit Documents.  No Credit Party has any defense or right of offset with respect to the Loans or any portion thereof.

 

1.01.4.    All of the assets pledged, assigned, conveyed, mortgaged, hypothecated or transferred to the Agent pursuant to the Collateral Documents are (and shall continue to be) subject to valid and enforceable liens and security interests of the Agent, as collateral security for all of the Obligations, subject to no Liens other than Permitted Liens.

 

1.01.5.  The obligations of Genco under this Agreement of any nature whatsoever, whether now existing or hereafter arising, are hereby deemed to be “Obligations” for all purposes of the Credit Documents.

 

1.01.6.  Overdue amounts under the Credit Documents shall accrue interest at the default rate provided in Section 1.07(b) of the Credit Agreement and be paid in kind.  The

 

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Lender Group agrees and acknowledges that such  interest at the default rate shall be paid in kind notwithstanding anything to the contrary set forth in the Credit Agreement.

 

1.01.7     Neither the Agent nor any Lender has at any time directed or participated in any aspect of the management of Genco or the conduct of the business of Genco, and Genco has made all of its business decisions independently of the Agent and each Lender. Notwithstanding any other provision of this Agreement or any other contract or instrument between or among Genco, on the one hand, and the Agent or the Lenders, or any of them, on the other hand: (i) the relationship between any of the Agent and the Lenders, on the one hand, and Genco, on the other hand, shall be limited to the relationship of a lender to a borrower in a commercial loan transaction; and (ii) neither the Agent nor any Lender is or shall be construed as a partner, joint venturer, alter-ego, manager, controlling person or other business associate or participant of any kind of Genco (or any other Person), and neither the Agent nor any Lender intends to assume any such status at any time.

 

1.01.8     The Lender Group’s entry into, and covenants to perform in accordance with, this Agreement hereby constitutes “new value” and “reasonably equivalent value,” as those terms are used in Section 547 and 548 of Title 11 of the United States Code (the “Bankruptcy Code”), received by Genco as of the closing of this Agreement in contemporaneous exchange for Genco’s entry into, and covenants to perform in accordance with, this Agreement.

 

1.01.9     All time-related defenses, such as statutes of limitations, doctrines of estoppel, doctrines of laches or any other rules of law or equity of similar nature, are hereby tolled with respect to all rights, claims and causes of action of any kind whatsoever that the Agent or any Lender may have against any Credit Party under or in connection with the Loan Documents as of the time of the closing of this Agreement through and including the date which is thirty (30) days after the termination of the Forbearance Period.

 

1.02.  Limited Forbearance.  Subject (i) to the satisfaction of the conditions precedent set forth in Section 3 below and (ii) to the continuing effectiveness and enforceability of the Credit Documents in accordance with their terms, the Lender Group agrees to forbear and directs the Agent to forbear (and in connection therewith, directs the Agent to enter into this Agreement and to take such actions as are reasonably incidental hereto), and the Agent agrees to forbear (and in connection therewith, agrees to enter into this Agreement and to take such actions as are reasonably incidental hereto), in the exercise of their respective rights and remedies under the Credit Documents (including, without limitation, each Control Agreement and with respect to any deposit or securities account, and including accelerating any of the Obligations and terminating any Commitments) in respect of the Specified Defaults for the period (the “Forbearance Period”) commencing on the Effective Date and ending on the earlier to occur of (a) 11:59 p.m. (New York time) on April 21, 2014 or (b) a Termination Event (as defined in Section 1.04 below), provided that (i) except with respect to the Specified Defaults, each Credit Party shall comply with all limitations, restrictions, covenants and prohibitions that would otherwise be effective or applicable to it under the Credit Documents and (ii) nothing herein shall be construed as a waiver by the Agent or any Lender of the Specified Defaults.

 

1.03.  Termination of Forbearance Period.  Upon the termination of the Forbearance Period, the agreement of the Agent and the Lender Group to forbear as provided in this

 

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Agreement shall automatically and without further action terminate and be of no force and effect; it being expressly agreed that the effect of such termination will be to permit the Agent and the Lenders to exercise, or cause the exercise of, any rights and remedies available to any of them, immediately, without any further notice, passage of time or forbearance of any kind.

 

1.04.  Termination Events.  For purposes of this Agreement, “Termination Event” means the occurrence of any of the following:

 

1.04.1.    An “Event of Default” under the Credit Agreement other than the Specified Defaults.

 

1.04.2.    The breach by any person other than the Agent or the Lender Group of any provision of this Agreement or any other document entered into in connection with this Agreement.

 

1.04.3     If, on or before 11:59 p.m. (New York time) on April [_], 2014, the Administrative Agent has not received evidence satisfactory to the Administrative Agent and the Lender Group that the following parties have become “Supporting Creditors” party to the restructuring support agreement to which the Lender Group became a party on or about April 1, 2014 (such agreement, the “RSA”):

 

(a)                         the holders of claims equal to at least 60% of the aggregate principal amount outstanding under the Convertible Notes (as such term is defined in the RSA);

 

(b)                         the holders of claims equal to at least 100% of the aggregate principal amount outstanding under the $253 Million Facility (as such term is defined in the RSA); and

 

(c)                          the holders of claims equal to at least 100% of the aggregate principal amount outstanding under the $100 Million Facility (as such term is defined in the RSA).

 

Section 2.  Representations and Warranties.  Genco represents and warrants to the Agent and the Lenders that (a) the representations and warranties set forth in (i) Section 9.01 through 9.04 of the Credit Agreement and (ii) any other representations made by Genco in connection with any amendment, waiver or forbearance agreement with respect to each Other Credit Agreement (as defined in clauses (i) and (ii) of such definition), in each case, are true and complete in all material respects on the date hereof as if made on and as of the date hereof (or, if any such representation or warranty is expressly stated to have been made as of a specific date, such representation or warranty shall be true and correct in all material respects as of such specific date); and (b) no Default or Event of Default has occurred and is continuing (other than the Specified Defaults).

 

Section 3.  Conditions Precedent.  The obligation of the Lender Group to enter into this Agreement shall be subject to the satisfaction or waiver by the Lender Group of each of the following conditions precedent:

 

3.01.  Expenses.  Payment, in cash, of all costs and expenses of the Agent and the Lender Group, including all fees and disbursements of their respective legal and financial advisors.

 

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3.02.  No Default.  No Default or Event of Default other than the Specified Defaults shall have occurred and be continuing.

 

3.03.  Representations and Warranties.  As of the Effective Date, the representations and warranties contained in (i) Section 9.01 through 9.04 of the Credit Agreement and (ii) any other representations made by Genco in connection with any amendment, waiver or forbearance agreement with respect to each Other Credit Agreement (as defined in clauses (i) and (ii) of such definition), shall, in each case, be true and correct in all material respects on and as of the Effective Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date.

 

Section 4.  Effectiveness of Agreement.  This Agreement shall become effective, as of the date hereof (the “Effective Date”) , upon receipt by the Agent of counterparts of this Agreement executed by each of the parties indicated on the signature pages hereof.

 

Section 5.  Release.  Each Credit Party (on behalf of itself and its Subsidiaries and Affiliates) and their successors-in-title, legal representatives and assignees and, to the extent the same is claimed by right of, through or under any Credit Party for their past, present and future employees, agents, representatives, officers, directors, shareholders, and trustees (each, a “Releasing Party” and collectively, the “Releasing Parties”), does hereby remise, release and discharge, and shall be deemed to have forever remised, released and discharged, the Agent and the Lenders, and the Agent’s and each Lender’s respective successors-in-title, legal representatives and assignees, past, present and future officers, directors, shareholders, trustees, agents, employees, consultants, experts, advisors, attorneys and other professionals and all other persons and entities to whom any of the foregoing would be liable if such persons or entities were found to be liable to any Releasing Party, or any of them (collectively hereinafter the “Lender Parties”), from any and all manner of action and actions, cause and causes of action, claims, charges, demands, counterclaims, 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 on account of any liability, obligation, demand or cause of action of whatever nature, whether in law, equity or otherwise (including without limitation those arising under sections 541-550 of the Bankruptcy Code and interest or other carrying costs, penalties, legal, accounting and other professional fees and expenses, and incidental, consequential and punitive damages payable to third parties), whether known or unknown, fixed or contingent, joint and/or several, secured or unsecured, due or not due, primary or secondary, liquidated or unliquidated, contractual or tortious, direct, indirect, or derivative, asserted or unasserted, foreseen or unforeseen, suspected or unsuspected, now existing, heretofore existing or which may heretofore accrue against any of the Lender Parties, whether held in a personal or representative capacity, and which are based on any act, fact, event or omission or other matter, cause or thing occurring at or from any time prior to and including the date hereof in any way, directly or indirectly arising out of, connected with or relating to this Credit Agreement or any other Credit Document and the transactions contemplated thereby, and all other agreements, certificates, instruments and other documents and statements (whether written or oral) related to any of the foregoing (each, a “Claim” and collectively, the “Claims”).  Notwithstanding the foregoing, the foregoing waiver of Claims shall not be effective to the extent any Claim arises from the gross negligence, bad faith or willful misconduct of a Lender Party.

 

Section 6.  Confirmation of Collateral Documents.  Each of the Credit Parties hereby confirms and ratifies all of its obligations under the Credit Documents to which it is a party.  By its execution on the respective signature lines provided below, each of the Credit Parties hereby confirms and ratifies all of its obligations and the Liens granted by it under the Collateral Documents to which it is a party.

 

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Section 7.  Miscellaneous.  Except as herein expressly provided, the Credit Agreement and each of the other Credit Documents shall remain unchanged and in full force and effect.  This Agreement shall constitute a “Credit Document” under the Credit Agreement.  The forbearance set forth in Section 1 above shall be limited as written and nothing herein shall be deemed to constitute a waiver of or forbearance with respect to any other term, provision or condition of the Credit Agreement or any other Credit Document in any other instance than as set forth herein or prejudice any right or remedy that Administrative Agent, Collateral Agent or any Lender may have or may in the future have under the Credit Agreement or any other Credit Document.  This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same amendatory instrument and any of the parties hereto may execute this Agreement by signing any such counterpart.  Delivery of an executed counterpart of a signature page to this Agreement by electronic transmission shall be effective as delivery of a manually executed counterpart of this Agreement.  This Agreement shall be governed by, and construed in accordance with, the law of the State of New York, without giving effect to any choice of law principals that would require or permit the application of the law of another jurisdiction.

 

[Signature Pages Follow]

 

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EXECUTION VERSION

 

IN WITNESS WHEREOF, the parties hereto have caused this Forbearance Agreement to be duly executed and delivered as of the day and year first above written.

 

 

	
 
    	
GENCO SHIPPING & TRADING LIMITED
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   John C. Wobensmith
    
	
 
    	
 
    	
Name:   John C. Wobensmith
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
GENCO   ACHERON LIMITED
    
	
 
    	
GENCO   BEAUTY LIMITED
    
	
 
    	
GENCO   KNIGHT LIMITED
    
	
 
    	
GENCO   LEADER LIMITED
    
	
 
    	
GENCO   MUSE LIMITED
    
	
 
    	
GENCO   VIGOUR LIMITED
    
	
 
    	
GENCO   CARRIER LIMITED
    
	
 
    	
GENCO   PROSPERITY LIMITED
    
	
 
    	
GENCO   SUCCESS LIMITED
    
	
 
    	
GENCO   WISDOM LIMITED
    
	
 
    	
GENCO   MARINE LIMITED
    
	
 
    	
GENCO   EXPLORER LIMITED
    
	
 
    	
GENCO   PIONEER LIMITED
    
	
 
    	
GENCO   PROGRESS LIMITED
    
	
 
    	
GENCO   RELIANCE LIMITED
    
	
 
    	
GENCO   SURPRISE LIMITED
    
	
 
    	
GENCO   SUGAR LIMITED
    
	
 
    	
GENCO   AUGUSTUS LIMITED
    
	
 
    	
GENCO   TIBERIUS LIMITED
    
	
 
    	
GENCO   LONDON LIMITED
    
	
 
    	
GENCO   TITUS LIMITED
    
	
 
    	
GENCO   CONSTANTINE LIMITED
    
	
 
    	
GENCO   HADRIAN LIMITED
    
	
 
    	
GENCO   COMMODUS LIMITED
    
	
 
    	
GENCO   MAXIMUS LIMITED
    
	
 
    	
GENCO   CLAUDIUS LIMITED
    
	
 
    	
GENCO   CHALLENGER LIMITED
    
	
 
    	
GENCO   CHAMPION LIMITED
    
	
 
    	
GENCO   CHARGER LIMITED
    
	
 
    	
GENCO   HUNTER LIMITED
    
	
 
    	
GENCO   PREDATOR LIMITED
    
	
 
    	
GENCO   WARRIOR LIMITED
    
	
 
    	
GENCO   BAY LIMITED
    
	
 
    	
GENCO   OCEAN LIMITED
    
	
 
    	
GENCO AVRA LIMITED
    
	
 
    	
GENCO MARE LIMITED
    
	
 
    	
GENCO   SPIRIT LIMITED
    
	
 
    	
GENCO   LORRAINE LIMITED
    
	
 
    	
GENCO   PYRENEES LIMITED
    
	
 
    	
GENCO   LOIRE LIMITED
    
	
 
    	
GENCO   BOURGOGNE LIMITED
    

 

 

	
 
    	
GENCO   PICARDY LIMITED
    
	
 
    	
GENCO   AQUITAINE LIMITED
    
	
 
    	
GENCO   NORMANDY LIMITED
    
	
 
    	
GENCO   AUVERGNE LIMITED
    
	
 
    	
GENCO   PROVENCE LIMITED
    
	
 
    	
GENCO   ARDENNES LIMITED
    
	
 
    	
GENCO   BRITTANY LIMITED
    
	
 
    	
GENCO   LANGUEDOC LIMITED
    
	
 
    	
GENCO   RHONE LIMITED
    
	
 
    	
GENCO   INVESTMENTS LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   John C. Wobensmith
    
	
 
    	
 
    	
Name:  John C. Wobensmith
    
	
 
    	
 
    	
Title:   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
GENCO RAPTOR LLC
    
	
 
    	
GENCO CAVALIER LLC
    
	
 
    	
GENCO   THUNDER LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   John C. Wobensmith
    
	
 
    	
 
    	
Name:  John C. Wobensmith
    
	
 
    	
 
    	
Title:   Manager
    

 

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WILMINGTON   TRUST, NATIONAL ASSOCIATION,
   as Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Joshua G. James
    
	
 
    	
 
    	
 
    	
Name:  Joshua G. James
    
	
 
    	
 
    	
 
    	
Title: Assistant Vice President
    

 

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LENDERS:
    	
 
    	
 
    
	
 
    	
APOLLO SPECIAL OPPORTUNITIES MANAGED ACCOUNT, LP., as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO SOMA ADVISORS, L.P., its general partner
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO SOMA CAPITAL MANAGEMENT, LLC, its general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
AES (LUX) S.A R.L., as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO EUROPEAN STRATEGIC MANAGEMENT, L.P., its investment manager
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO EUROPEAN STRATEGIC MANAGEMENT GP, LLC, its general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
AEC (LUX) S.A R.L., as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO EUROPEAN CREDIT MANAGEMENT, L.P., its investment manager
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO EUROPEAN CREDIT MANAGEMENT GP, LLC, its general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    
				

 

 

	
 
    	
APOLLO CENTRE STREET PARTNERSHIP, L.P., as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO CENTRE STREET MANAGEMENT, LLC, its investment manager
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ANS U.S. HOLDINGS LTD, as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO SK STRATEGIC ADVISORS, LLC, its sole director
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
APOLLO CREDIT OPPORTUNITY FUND III LP, as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO CREDIT OPPORTUNITY ADVISORS III LP, its general partner
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO CREDIT OPPORTUNITY ADVISORS III GP LLC, its general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
APOLLO FRANKLIN PARTNERSHIP, LP., as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO FRANKLIN ADVISORS (APO DC), L.P., its general partner
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO FRANKLIN ADVISORS (APO DC-GP), LLC, its general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
APOLLO ZEUS STRATEGIC INVESTMENTS, LP., as Lender
    
	
 
    	
 
    
	
 
    	
BY:   APOLLO ZEUS STRATEGIC MANAGEMENT, LLC, its investment manager
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joseph D. Glatt
    
	
 
    	
Name:   Joseph D. Glatt
    
	
 
    	
Title:   Vice President
    

 

 

	
 
    	
LENDERS:
    
	
 
    	
 
    
	
 
    	
CCP   Credit Acquisition Holdings, L.L.C.,
    
	
 
    	
Centerbridge   Special Credit Partners II, L.P.
    
	
 
    	
CCP   II Acquisition Holdings, LLC, as Lenders
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Bao Truong
    
	
 
    	
Name:   Bao Truong
    
	
 
    	
Title:   Senior Managing Director
    

 

 

	
 
    	
LENDERS:
    
	
 
    	
 
    
	
 
    	
MIDTOWN   ACQUISITIONS L.P.
    
	
 
    	
as   Lender
    
	
 
    	
 
    
	
 
    	
BY:   MIDTOWN ACQUISITIONS GP, LLC,
    
	
 
    	
its   General Partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Avram Z. Friedman
    
	
 
    	
Name:   Avram Z. Friedman
    
	
 
    	
Title:   Manager
    

 

 

	
 
    	
LENDERS:
    
	
 
    	
 
    
	
 
    	
PANNING MASTER FUND LP, as Lender
    
	
 
    	
 
    
	
 
    	
BY:   PANNING CAPITAL MANAGEMENT, LP, its
   Investment Manager
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   William M. Kelly
    
	
 
    	
Name   William M. Kelly
    
	
 
    	
Title:   Chief Operating Officer
    

 

 

	
 
    	
LENDERS:
    
	
 
    	
 
    
	
 
    	
SOLUS   ALTERNATIVE ASSET
    
	
 
    	
MANAGEMENT   LP, on behalf of certain funds
    
	
 
    	
and   managed accounts, as Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Christopher A. Pucillo by SJD w/permission
    
	
 
    	
Name   Christopher A. Pucillo
    
	
 
    	
Title:   Chief Investment OfficerExhibit 10.2

 

[On the letterhead of Deutsche Bank Luxembourg S.A.]

 

To:                     Genco Shipping & Trading Limited

 

Copy:      Genco Lorraine Limited

Genco Pyrenees Limited

Genco Loire Limited

Genco Bourgogne Limited

Genco Picardy Limited

Genco Aquitaine Limited

Genco Normandy Limited

Genco Auvergne Limited

Genco Provence Limited

Genco Ardennes Limited

Genco Brittany Limited

Genco Languedoc Limited

Genco Rhone Limited

 

1 April 2014

 

Dear Sirs

 

US$253,000,000 secured loan agreement dated 20 August 2010 (as amended by a side letter dated 24 August 2010, as further amended by a waiver letter dated 20 December 2011, as amended and restated on 1 August 2012 and as further amended, supplemented or restated from time to time, the “Loan Agreement”) made between (1) Genco Shipping & Trading Limited as borrower, (2) the Lenders (as defined therein), (3) Deutsche Bank AG Filiale Deutschlandgeschäft, BNP Paribas, Credit Agricole Corporate and Investment Bank, DVB Bank SE and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers, (4) yourselves as agent for the Lenders, (5) BNP Paribas, Credit Agricole Corporate and Investment Bank, Deutsche Bank AG, DVB Bank SE and Skandinaviska Enskilda Banken AB (publ) as swap providers (the “Swap Providers”) and (vi) Deutsche Bank AG Filiale Deutschlandgeschäft as security agent for the Lenders and the Swap Providers and as bookrunner.

 

1                                         Definitions

 

1.1                               In this letter:

 

“Enforcement Action” means:

 

(a)                                in relation to any Liabilities (with the exception of Liabilities arising as a result of the termination of existing interest protection agreements and other hedging agreements  entered into in connection with the DnB Credit Agreement):

 

(i)                           the acceleration of any Liability or the making of any declaration that any Liabilities are due and payable or payable on demand;

 

(ii)                        any demand against any Group Member under any security, guarantee or surety provided of that Group Member;

 

 

(iii)                     the exercise of any right of set-off, account combination or payment netting against any Group Member in respect of any Liabilities other than ordinary netting under any swap or derivative contract; and

 

(iv)                    the premature termination or close-out of any swap or derivative transaction under any swap or derivative contract entered into with any Group Member;

 

(b)                                the taking of any steps to enforce or require the enforcement of any Encumbrance granted by any Group Member (including any arrest of any vessel for a claim in excess of $5,000,000 or any other enforcement of any mortgage over any vessel or any other asset of any Group Members the crystallisation of any floating charge or redirecting the earnings of any vessel or the other assets of any Group Member), except for any enforcement of assignment of insurances in relation to a total loss or other significant insured event; or

 

(c)                                 the petitioning or applying for any Insolvency Proceeding;

 

“Group” means the Borrower and each of its Subsidiaries other than Baltic Trading Limited and its Subsidiaries, and a “Group Member” means any of them;

 

“Insolvency Proceedings” means any bankruptcy, liquidation, reconstruction, winding up, dissolution, administration or reorganisation of any Group member, or any of such Group Member’s assets or a composition, compromise, assignment or arrangement with any creditor of any Group Member or any suspension of payments or moratorium of any indebtedness of any such Group Member, or any other insolvency proceedings or any analogous procedure or step in any jurisdiction (including the appointment of any liquidator, receiver, administrator, trustee or similar officer), including but not limited to, any chapter 11 cases in the United States of America;

 

“Liability” means any and all Financial Indebtedness of any Group Member in excess of $5,000,000; and

 

“Termination Event” shall have the meaning given to it in paragraph 4.1 below.

 

1.2                              All other terms and expressions used in this letter shall have the same meaning given to them in the Loan Agreement.

 

1.3                              This letter is designated as a Finance Document.

 

2                                         Request

 

We refer to the Loan Agreement and to your letter to us dated 1 April 2014 requesting a temporary waiver (the “Waivers”) of:

 

(a)                                the Consolidated Interest Coverage Ratio in clause 12.2.2 (Consolidated Interest Coverage Ratio) of the Loan Agreement and the Leverage Ratio in clause 12.2.3 (Maximum Leverage Ratio) of the Loan Agreement (the

 

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“Financial Covenants”) for the fiscal quarter ending 31 March 2014 through and including 11:59pm (New York time) 21 April 2014 (the “Waiver Period”);

 

(b)                                the event of default that will arise pursuant to clause 13.1.4 (cross default) of the Loan Agreement resulting from (i) the failure to pay the required payment due in respect of the scheduled commitment reduction under the DnB Credit Agreement on 31 March 2014, (ii) the failure by the Borrower to comply with the financial covenants set out in the DnB Credit Agreement during the Waiver Period and (iii) the breach of the cross-default provisions in existing interest protection agreements and other hedging agreements  as a result of the defaults set out above under the DnB Credit Agreement (the “Cross Defaults”) for the Waiver Period; and

 

(c)                                 the events of default arising under:

 

(i)                                     clause 13.1.5(a) of the Loan Agreement; and

 

(ii)                                  clause 13.1.6 of the Loan Agreement, solely:

 

(x)                                to the extent that permits any Security Party to vote or authorise to commence proceedings under Chapter 11 of the Bankruptcy Code of the United States of America (the “Chapter 11 Proceedings”), which are undertaken for the purpose of implementing the proposed restructuring of the Borrower’s existing bank facilities and other indebtedness pursuant to a restructuring support agreement to be entered into by, among others, the lenders under the Loan Agreement, the lenders under the Metrostar Credit Agreement and the lenders under the DnB Credit Agreement (the “RSA”); and

 

(y)                                to the extent that the current discussions and actions between the Group Members and their creditor groups for the purpose of implementing the Chapter 11 Proceedings and the RSA, including entering into this letter, the Collateral Letters and the RSA, fall within clause 13.1.6 of the Loan Agreement,

 

(iii)                            clause 12.1.1 of the Loan Agreement in respect of the financial statements of the Security Parties for the financial year ending on 31 December 2013,

 

(together, the “Specific Defaults”).

 

3                                         Waiver and Conditions

 

We hereby agree to waive (i) your compliance with the Financial Covenants, (ii) the Cross Defaults and (iii) the Specific Defaults, in each case during the Waiver Period, subject to the following conditions being satisfied:

 

(a)                                the Waivers shall apply only in relation to the Waiver Period;

 

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(b)                                prior to 17.00 hours (New York Time) on 1 April 2014, you provide us with evidence to our satisfaction that (i) the required lenders under the Metrostar Credit Agreement have consented to waivers under the Metrostar Credit Agreement on substantially similar terms to this letter (the “Metrostar Waiver Letter”) and (ii) the majority lenders under the DnB Credit Agreement have provided a forbearance under the DnB Credit Agreement in form, content and effect similar to this letter including that the majority lenders thereunder have agreed, amongst other things, that during the Waiver Period, they shall not exercise their rights resulting from the failure for the Borrower to pay the required payment due in respect of the scheduled commitment reduction under the DnB Credit Agreement on 31 March 2014 (the “DnB Forbearance Letter” and together with the Metrostar Waiver Letter, the “Collateral Letters”), such evidence being in the form of executed copies of the Collateral Letters and an email from the respective agent of the Metrostar Credit Agreement and the DnB Credit Agreement or their legal counsels that the waivers under the Collateral Letters have taken effect.

 

4                                         Termination of Waivers

 

4.1                              The Waivers shall cease to apply automatically and with immediate effect if any event specified in 4.1(a) to (h) below occurs (each a “Termination Event”), unless such Termination Events are expressly waived by the Agent, acting on the instructions of the Majority Lenders:

 

(a)                                an Event of Default has occurred (other than the Events of Default waived pursuant to this letter);

 

(b)                                you are in breach of any of your obligations under this letter;

 

(c)                                 the Waiver Period has expired;

 

(d)                                a Collateral Letter is terminated, repudiated or rescinded or ceases to have effect or is amended or varied in any way that would have a material adverse effect on any of the Finance Parties;

 

(e)                                 any creditor takes Enforcement Action against any Group Member and such Enforcement Action triggers an event of default (however described in any other agreement relating to Financial Indebtedness), which is not waived or forborne;

 

(f)                                  if any five (5) vessels owned by the Group are arrested during the Waiver Period and not released within three (3) Business Days of such arrest;

 

(g)                                 any Group Member petitions or applies for any Insolvency Proceedings; or

 

(h)                                any Group Member fails to pay any indebtedness (with the exception of Liabilities arising as a result of the termination of existing interest protection agreements and other hedging agreements entered into in connection with the DnB Credit Agreement) owed to any of its creditors as and when they fall due and the same constitute an event of default (however described in any

 

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agreement relating to Financial Indebtedness), which is not waived or forborne.

 

4.2                              After the termination of this letter, each of the Finance Parties shall be released from all of its obligations under this letter and may take any Enforcement Action after such termination in accordance with the terms of the Finance Documents.

 

5                                         Reservation of Rights

 

Nothing in this letter shall prevent the Finance Parties from taking any Enforcement Action after the Waiver Period in respect of any Event of Default which has occurred or may occur during the Waiver Period or which occurs or continues after the termination of this letter, regardless of whether such Event of Default occurred prior to or during the Waiver Period.  Accordingly, this letter shall not constitute any waiver by the Finance Parties of any breach or default by any Group Member and the Finance Parties reserve all rights in relation thereto, except as otherwise expressly set out in this letter and subject only to the terms of this letter.

 

6                                         Undertakings

 

6.1                              During the Waiver Period, you shall, on a reasonable best efforts basis, promptly provide us with any information that is provided to the creditors under the DnB Credit Agreement and the Metrostar Credit Agreement if such information has an effect on the economic interests of any of the Finance Parties.

 

6.2                              You shall promptly notify us if a Collateral Letter is capable of being terminated, is terminated or ceases to have effect, or a party to a Collateral Letter takes steps to amend, terminate, repudiate or rescind a Collateral Letter or if any waivers or amendments are made, proposed or requested to a Collateral Letter or if you or any Group Member breaches any of the terms contained in a Collateral Letter.

 

6.3                               You shall promptly notify us if:

 

(i)                                    a Termination Event occurs or is reasonably likely to occur; or

 

(ii)                                  any Enforcement Action is commenced against a Group Member.

 

6.4                              During the Waiver Period, you shall not enter into any waiver, modification or amendment to any of the DnB Credit Agreement and the Metrostar Credit Agreement which grants more favourable provisions or treatment to the lenders thereunder unless each of the Finance Parties receives the benefit of such more favourable provisions at the same time and on the same terms.

 

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7                                        Continuing Security

 

You confirm that any Encumbrance created and/or any guarantee granted by the Security Parties in favour of any of the Finance Parties remains in full force and effect and is not in any way affected by this letter.

 

8                                         Counterparts and applicable law

 

8.1                              This letter may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this letter.

 

8.2                              This letter and any non-contractual obligations arising out of or in connection with it shall be governed by and construed in accordance with English law.

 

8.3                              For the exclusive benefit of the Finance Parties, the parties to this letter irrevocably agree that the courts of England are to have exclusive jurisdiction to settle any dispute (a) arising from or in connection with this letter or (b) relating to any non-contractual obligations arising from or in connection with this letter and that any proceedings may be brought in those courts.

 

Please confirm your agreement to the terms of this letter by signing and returning a duplicate of this letter to us.

 

Yours faithfully

 

	
/s/   G. Meyer
    	
 
    
	
Name:   G. Meyer
    	
 
    
	
 
    	
 
    
	
/s/   T. Schroeter
    	
 
    
	
Name:   T. Schroeter
    	
 
    

 

 

For and on behalf of

Deutsche Bank Luxembourg S.A.

(as Agent acting on the instructions of the Majority Lenders)

 

6

 

[On Duplicate]

 

Confirmed and agreed on 1 April 2014

for an on behalf of

 

 

	
/s/ John C.   Wobensmith
    	
 
    
	
Genco   Shipping & Trading Limited
    	
 
    
	
(as Borrower)
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
/s/ John C.   Wobensmith
    	
 
    
	
Genco   Lorraine Limited
    	
 
    
	
Genco   Pyrenees Limited
    	
 
    
	
Genco   Loire Limited
    	
 
    
	
Genco   Bourgogne Limited
    	
 
    
	
Genco   Picardy Limited
    	
 
    
	
Genco   Aquitaine Limited
    	
 
    
	
Genco   Normandy Limited
    	
 
    
	
Genco   Auvergne Limited
    	
 
    
	
Genco   Provence Limited
    	
 
    
	
Genco   Ardennes Limited
    	
 
    
	
Genco   Brittany Limited
    	
 
    
	
Genco   Languedoc Limited
    	
 
    
	
Genco   Rhone Limited
    	
 
    
	
(as Collateral   Owners and Guarantors)
    	
 
    

 

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