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Republic of the Marshall Islands | 4412 | Not Applicable | ||
(State or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification Number) |
A. Jeffry Robinson, Esq. Broad and Cassel 2 South Biscayne Blvd., 21st Floor Miami, Florida 33131 Office: (305) 373-9400 Fax: (305) 373-9443 | Andrew J. Pitts, Esq. Cravath, Swaine & Moore LLP Worldwide Plaza 825 Eighth Avenue New York, New York 10019 Office: 212-474-1000 Fax: 212-474-3700 |
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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. |
Per Share | Total | |||||||
Public offering price | $ | $ | ||||||
Underwriting discounts | $ | $ | ||||||
Proceeds to us, before expenses, from this offering to the public | $ | $ | ||||||
Proceeds to us, before expenses, from the concurrent sale | $ | $ | ||||||
Total proceeds to us, before expenses | $ | $ |
Citi | Dahlman Rose & Company |
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Daily Time | ||||||||||||
Year | Terms of Time | Charter | ||||||||||
Vessel/Flag | Type | Dwt | Built | Charter Period | Hire Rate | Charterer | ||||||
African Oryx/Bahamas | Handysize | 24,110 | 1997 | Expiring August 2011 | $7,000 plus a 50% profit share calculated on the average spot Time Charter Routes derived from the Baltic Supramax Index | MUR Shipping B.V. | ||||||
African Zebra/Bahamas | Handymax | 38,623 | 1985 | Expiring August 2011 | $7,500 plus a 50% profit share calculated on the average spot Time Charter Routes derived from the Baltic Supramax Index | MUR Shipping B.V. | ||||||
Bremen Max/Isle of Man | Panamax | 73,503 | 1993 | Expiring August 2010 | $15,500 | SAMC | ||||||
Hamburg Max/Isle of Man | Panamax | 72,338 | 1994 | Expiring September 2010 | $15,500 | SAMC | ||||||
Davakis G./Bahamas(1)(4) | Supramax | 54,051 | 2008 | SPOT | N/A | |||||||
Delos Ranger/Bahamas(1)(4) | Supramax | 54,051 | 2008 | SPOT | N/A | |||||||
BET Commander/Isle of Man(2) | Capesize | 149,507 | 1991 | December 2009(3) | $22,000 | Swiss Marine Services SA | ||||||
BET Fighter/St. Vincent and the Grenadines(2) | Capesize | 173,149 | 1992 | Expiring in September 2011 | $25,000 | SAMC | ||||||
BET Prince/Isle of Man(2) | Capesize | 163,554 | 1995 | Expiring in November 2009(3) | $23,000 | Swiss Marine Services SA | ||||||
BET Scouter/Isle of Man(2) | Capesize | 171,175 | 1995 | Expiring in October 2011 | $26,000 | SAMC | ||||||
BET Intruder/Isle of Man(2) | Panamax | 69,235 | 1993 | Expiring in September 2011 | $15,500 | SAMC | ||||||
Total | 1,043,296 | |||||||||||
(1) | The vessels are employed in the spot market. | |
(2) | Vessels owned by BET. |
(3) | We have secured new time charters with SAMC for each of the BET Commander and BET Prince commencing upon the expiration of the existing time charters at daily charter rates of $24,000 and $25,000, respectively, through February 2012 and January 2012, respectively. |
(4) | Sisterships. |
• | Capesize. Capesize vessels have a carrying capacity of 100,000-199,999 dwt. Only the largest ports around the world possess the infrastructure to accommodate vessels of this size. Capesize vessels are primarily used to transport iron ore or coal and, to a much lesser extent, grains, primarily on long-haul routes. | |
• | Panamax. Panamax vessels have a carrying capacity of between 60,000 and 100,000 dwt. These vessels are designed to meet the physical restrictions of the Panama Canal locks (hence their name “Panamax” — the largest vessels able to transit the Panama Canal, making them more versatile than larger vessels). These vessels carry coal, grains, and, to a lesser extent, minerals such as bauxite/alumina and phosphate rock. As the availability of Capesize vessels has dwindled, Panamaxes have also been used to haul iron ore cargoes. | |
• | Handymax/Supramax. Handymax vessels have a carrying capacity of between 30,000 and 60,000 dwt. These vessels operate on a large number of geographically dispersed global trade routes, carrying primarily grains and minor bulks. The standard vessels are usually built with25-30 ton cargo gear, |
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enabling them to discharge cargo where grabs are required (particularly industrial minerals), and to conduct cargo operations in countries and ports with limited infrastructure. This type of vessel offers good trading flexibility and can therefore be used in a wide variety of bulk and neobulk trades, such as steel products. Supramax are asub-category of this category typically having a cargo carrying capacity of between 50,000 and 60,000 dwt. |
• | Handysize. Handysize vessels have a carrying capacity of up to 30,000 dwt. These vessels are almost exclusively carrying minor bulk cargo. Increasingly, vessels of this type operate on regional trading routes, and may serve as trans-shipment feeders for larger vessels. Handysize vessels are well suited for small ports with length and draft restrictions. Their cargo gear enables them to service ports lacking the infrastructure for cargo loading and unloading. |
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• | South African Marine Corporation, S.A., or SAMC, one of our charterers — established in 1999 as the chartering arm of the Restis group of companies; presently charters-in 16 vessels from Restis-affiliated entities and charters these vessels out to third parties; it has never defaulted on its charter obligations to us; |
• | Safbulk, our commercial broker — has been in business for over 10 years and provides brokerage services for all of the dry bulk vessels controlled by Restis entities; |
• | EST, our technical manager — has been in business over 34 years and presently manages approximately 95 dry bulk and tanker vessels; |
• | Waterfront, S.A., or Waterfront, the sublessor of our executive offices; |
• | First Financial Corp., the holding company for the Restis family dry cargo operations; and |
• | Golden Energy Marine Corp., a privately held transporter of dry bulk goods, crude oil, and petroleum products. |
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• | Extensive Industry Visibility. Our management and directors have extensive shipping and public company experience as well as relationships in the shipping industry and with charterers in the coal, steel and iron ore industries. We capitalize on these relationships and contacts to gain market intelligence, source sale and purchase opportunities and identify chartering opportunities with leading charterers in these core commodities industries, many of whom consider the reputation of a vessel owner and operator when entering into time charters. | |
• | Established Customer Relationships. We believe that our directors and management team have established relationships with leading charterers and a number of chartering, sales and purchase brokerage houses around the world. We believe that our directors and management team have maintained relationships with, and have achieved acceptance by, major national and private industrial users, commodity producers and traders. |
• | Experienced and Dedicated Management Team. We believe that our management team, equipped with extensive shipping experience, has developed strong industry relationships with leading charterers, shipbuilders, insurance underwriters, protection and indemnity associations and financial institutions. Management has continued to take actions over the course of the past year to allow us to operate profitably in 2009 after the net loss of $32 million we recorded for our initial period of operations through December 31, 2008. This net loss resulted primarily from a one-time non-cash charge in the 2008 period of $49.3 million for goodwill and vessel impairment losses related to the downturn in the worldwide economy and the resulting deteriorating vessel market values. The measures that our management team has taken, both to minimize the ongoing impact of the worldwide recession and to improve our results of operations, include the following: |
• | We secured charter agreements for our initial fleet prior to the market decline in May 2008 with SAMC, which honored its contractual obligations, providing us with a secure cash flow throughout the terms of the charters. As a result, for the nine months ended September 30, 2009, we earned $70.7 million of net vessel revenue and net income of $33.3 million. Our cash reserves were $64 million as of September 30, 2009, which reflected the $36.4 million in cash from operations we generated during the period. |
• | In August 2009, we completed the acquisition of a 50% ownership interest in BET. We acquired a 50% interest of net assets of $13.6 million for cash consideration of $1. As a result of this transaction, we almost doubled our fleet to 11 vessels and increased the dwt of our fleet by 229%, while also positioning us in the Capesize sector. The acquisition is immediately earnings accretive, improving our margins and cash flow, based on the charters currently in place for the vessels acquired as described above under “Our Fleet.” |
• | We have also secured time charter agreements of various durations, with our longest time charter expiring on February 24, 2012. Time charters cover 76% of 2010 days and 50% of 2011 days. |
• | We also received, during the same period, a waiver on the loan-to-value covenant from our lender. |
• | In August 2009, we negotiated the conversion of a $28.25 million convertible promissory note due to an affiliate August 2010, plus all fees and interest due on such note, in exchange for |
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6,585,868 shares of our common stock. With this conversion, we reduced our debt, and the resulting debt service obligations, without depleting our cash reserves. |
• | For the twelve months ended September 30, 2009, we achieved the EBITDA target agreed to in connection with our August 2008 acquisition of our initial fleet from the Restis family. Recently, the majority of our charters have been rechartered at prevailing market rates. For 2010, we expect our average daily operating expenses per vessel to be approximately $5,500, and we expect our average daily general and administrative expenses to be approximately $1,000. Our expectations regarding 2010 operating expenses and general and administrative statements are forward-looking statements. Our actual results could vary. See “Risk Factors” for information regarding factors, many of which are outside of our control, that could cause our actual expenses to differ from expectations. |
• | Highly Efficient Operations and High Quality Fleet. We believe that our directors’ and executive officers’ long experience in third-party technical management of dry bulk carriers enable us to maintain cost-efficient operations. We actively monitor and control vessel operating expenses while maintaining the high quality of our fleet through regular inspections, comprehensive planned maintenance systems and preventive maintenance programs and by retaining and training qualified crew members. We believe that our ability to maintain and increase our customer base depends largely on the quality and performance of our fleet. We believe that owning a high quality fleet reduces operating costs, improves safety and provides us with a competitive advantage in obtaining employment for our vessels. Our vessels were built and are maintained at reputable shipyards. |
• | Balanced Chartering Strategies. Nine of our vessels are under medium-term charters with terms of 11 to 13 and 22 to 26 months and provide for fixed payments in advance. We believe that these charters will provide us with high fleet utilization and stable revenues. Two of our vessels operate in the spot market. We may in the future pursue other market opportunities for our vessels to capitalize on favorable market conditions, including entering into short-term time and voyage charters, pool arrangements or bareboat charters. |
• | Broad Fleet Profile. We focus on the dry bulk sector including Capesize, Panamax, Handymax/Supramax and Handysize dry bulk carriers. Our broad fleet profile enables us to serve our customers in both major and minor bulk trades. Our vessels are able to trade worldwide in a multitude of trade routes carrying a wide range of cargoes for a number of industries. Our dry bulk carriers can carry coal and iron ore for energy and steel production as well as grain and steel products, fertilizers, minerals, forest products, ores, bauxite, alumina, cement and other cargoes. Our fleet includes sister ships. Operating sister and similar ships provides us with operational and scheduling flexibility, efficiencies in employee training and lower inventory and maintenance expenses. We believe that operating sister ships allows us to maintain lower operating costs and streamline its operations. |
• | Fleet Growth Potential. We intend to acquire additional dry bulk carriers or enter into new contracts through timely and selective acquisitions of vessels in a manner that we determine will be accretive to cash flow. We expect to fund the acquisition of the additional vessels primarily from the proceeds of this offering and any future acquisition of additional vessels using amounts borrowed under our credit facility, future borrowings under other agreements as well as with proceeds from the exercise of the Warrants, if any, or through other sources of debt and equity. However, there can be no assurance that we will be successful in obtaining future funding or that any or all of the warrants will be exercised. |
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Common stock offered by us to the public | Up to $ of shares of our common stock. |
Underwriters’ over-allotment option | Up to $ of shares of our common stock. |
Concurrent sale | Victor Restis, one of our significant shareholders, has committed to purchase directly from us at the public offering price of $ of shares of our common stock concurrently with the closing of this transaction. We refer to this transaction as the concurrent sale. |
Common stock outstanding after this offering and the concurrent sale(1) | shares. |
Use of proceeds | We estimate that we will receive net proceeds of approximately $ from this offering after deducting underwriting discounts and commissions, and offering expenses, and assuming the underwriters’ over-allotment option is not exercised. |
We intend to use the proceeds of this offering for the purchase of additional vessels and for general working capital purposes. See “Use of Proceeds.” |
NASDAQ Global Market symbols | Common stock — SHIP Warrants — SHIP.W | |
Risk factors | Investing in our common stock involves substantial risk. You should carefully consider all the information in this prospectus prior to investing in our common stock. In particular, we urge you to consider carefully the factors set forth in the section of this prospectus entitled “Risk Factors” beginning on page 12. |
(1) | The number of shares of common stock outstanding after this offering is based on shares of our common stock outstanding on November , 2009 and excludes the following: |
• | 1,000,000 shares of common stock included in the 1,000,000 units issuable upon exercise of the option at an exercise price of $12.50 per unit; |
• | 1,000,000 shares of common stock issuable for $6.50 per share upon exercise of the warrants underlying the units issuable upon exercise of the option; and |
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From | ||||||||||||||||||||||||||||
Inception | ||||||||||||||||||||||||||||
(August 15, | ||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | Years Ended | 2006) to | |||||||||||||||||||||||||
September 30, | September 30, | December 31, | December 31, | |||||||||||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2008 | 2007 | 2006 | ||||||||||||||||||||||
Statement of Operations Data: | ||||||||||||||||||||||||||||
Vessel revenue — related party, net | 20,485 | 6,122 | 68,795 | 6,122 | 34,453 | — | — | |||||||||||||||||||||
Vessel revenue, net | 1,867 | — | 1,867 | — | — | — | — | |||||||||||||||||||||
Direct voyage expenses | (42 | ) | (143 | ) | (480 | ) | (143 | ) | (151 | ) | — | — | ||||||||||||||||
Vessel operating expense | (3,935 | ) | (719 | ) | (9,756 | ) | (719 | ) | (3,180 | ) | — | |||||||||||||||||
Voyage expenses — related party | (222 | ) | (77 | ) | (841 | ) | (77 | ) | (440 | ) | — | — | ||||||||||||||||
Management fees — related party | (462 | ) | (82 | ) | (1,078 | ) | (82 | ) | (388 | ) | — | — | ||||||||||||||||
General and administration expenses | (1,014 | ) | (208 | ) | (3,083 | ) | (805 | ) | (1,840 | ) | (445 | ) | (5 | ) | ||||||||||||||
General and administration expenses — related party | (459 | ) | (50 | ) | (1,553 | ) | (50 | ) | (430 | ) | — | — | ||||||||||||||||
Amortization of dry-docking cost | (387 | ) | — | (397 | ) | — | — | — | — | |||||||||||||||||||
Depreciation | (5,286 | ) | (1,488 | ) | (20,716 | ) | (1,488 | ) | (9,929 | ) | — | — | ||||||||||||||||
Gain from acquisition | 6,813 | — | 6,813 | — | — | — | — | |||||||||||||||||||||
Goodwill impairment loss | — | — | — | — | (44,795 | ) | — | — | ||||||||||||||||||||
Vessels’ impairment loss | — | — | — | — | (4,530 | ) | — | — | ||||||||||||||||||||
Interest income — money market fund | 108 | 644 | 363 | 3,257 | 3,361 | 1,948 | 1 | |||||||||||||||||||||
Interest and finance costs | (3,525 | ) | (730 | ) | (6,656 | ) | (730 | ) | (4,077 | ) | (58 | ) | — | |||||||||||||||
Foreign currency exchange (losses), net | (25 | ) | 1 | (80 | ) | 1 | (39 | ) | — | — | ||||||||||||||||||
Net income (loss) | 13,916 | 3,270 | 33,198 | 5,286 | (31,985 | ) | 1,445 | (4 | ) | |||||||||||||||||||
Net (loss) attributable to noncontrolling interest | (67 | ) | — | (67 | ) | — | — | — | — | |||||||||||||||||||
Net income attributable to Seanergy Maritime | 13,983 | 3,270 | 33,265 | 5,286 | — | — | — | |||||||||||||||||||||
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September 30, | December 31, | |||||||||||||||
2009 | 2008 | 2007 | 2006 | |||||||||||||
Balance Sheet Data: | ||||||||||||||||
Total current assets | 70,986 | 29,814 | 235,213 | 376 | ||||||||||||
Vessels, net | 450,920 | 345,622 | — | — | ||||||||||||
Total assets | 547,140 | 378,202 | 235,213 | 632 | ||||||||||||
Total current liabilities, including current portion of long-term debt | 37,651 | 32,999 | 5,995 | 611 | ||||||||||||
Long-term debt, net of current portion | 274,489 | 213,638 | — | — | ||||||||||||
Total equity | 228,448 | 131,565 | 148,369 | 20 |
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | Year Ended | ||||||||||
2009 | 2009 | December 31, 2008 | ||||||||||
Fleet Data: | ||||||||||||
Average number of vessels(1) | 8.7 | 6.9 | 5.5 | |||||||||
Ownership days(2) | 797 | 1,883 | 686 | |||||||||
Available days(3) | 739 | 1,654 | 686 | |||||||||
Operating days(4) | 735 | 1,646 | 678 | |||||||||
Fleet utilization(5) | 92.2 | % | 87.4 | % | 98.9 | % | ||||||
Average Daily Results: | ||||||||||||
Vessel TCE rate(6) | 30,052 | 42,127 | 49,362 | |||||||||
Vessel operating expenses(7) | 4,937 | 5,181 | 4,636 | |||||||||
Management fees(8) | 580 | 572 | 566 | |||||||||
Total vessel operating expenses | 5,517 | 5,753 | 5,202 |
(1) | Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the relevant period divided by the number of calendar days in the relevant period. | |
(2) | Ownership days are the total number of days in a period during which the vessels in a fleet have been owned. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we recorded during a period. |
(3) | Available days are the number of ownership days less the aggregate number of days that vessels areoff-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels should be capable of generating revenues. During the three months ended September 30, 2009, we incurred 58 off-hire days for scheduled vessel dry-docking. During the nine months ended September 30, 2009, we incurred229 off-hire days for scheduled vessel dry-docking. |
(4) | Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
(5) | Fleet utilization is the percentage of time that our vessels were generating revenue, and is determined by dividing operating days by ownership days for the relevant period. |
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(6) | Time charter equivalent, or TCE, rates are defined as our time charter revenues less voyage expenses during a period divided by the number of our operating days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. |
Three Months Ended | Nine Months Ended | Year Ended | ||||||||||
September 30, 2009 | September 30, 2009 | December 31, 2008 | ||||||||||
(In thousands of U.S. dollars, except operating days) | ||||||||||||
Net revenues from vessels | 22,352 | 70,662 | 34,453 | |||||||||
Voyage expenses | (42 | ) | (480 | ) | (151 | ) | ||||||
Voyage expenses — related party | (222 | ) | (841 | ) | (440 | ) | ||||||
Net operating revenues | 22,088 | 69,341 | 33,862 | |||||||||
Operating days | 735 | 1,646 | 686 | |||||||||
Time charter equivalent rate | 30,052 | 42,127 | 49,362 |
(7) | Average daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs, are calculated by dividing vessel operating expenses by ownership days for the relevant time periods: |
Three Months Ended | Nine Months Ended | Year Ended | ||||||||||
September 30, 2009 | September 30, 2009 | December 31, 2008 | ||||||||||
(In thousands of U.S. dollars, except ownership days) | ||||||||||||
Operating expenses | 3,935 | 9,756 | 3,180 | |||||||||
Ownership days | 797 | 1,883 | 686 | |||||||||
Daily vessel operating expenses | 4,937 | 5,181 | 4,636 |
(8) | Daily management fees are calculated by dividing total management fees by ownership days for the relevant time period. |
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• | incur additional indebtedness; | |
• | create liens on our or our subsidiaries’ assets; | |
• | sell capital stock of our subsidiaries; | |
• | engage in any business other than the operation of the vessels; | |
• | pay dividends; | |
• | change or terminate the management of the vessels or terminate or materially amend the management agreement relating to each vessel; and | |
• | sell the vessels. |
• | The ratio of total liabilities to total assets; | |
• | The ratio of total net debt owed to LTM (last twelve months) EBITDA; | |
• | The ratio of LTM EBITDA to net interest expense; | |
• | The ratio of cash deposits held to total debt; and | |
• | A security margin, or the Security Margin Clause, whereby the aggregate market value of the vessels and the value of any additional security is required to be at least 135% of the aggregate of the debt financing and any amount available for drawing under the revolving facility, less the aggregate amount of all deposits maintained. A waiver from Marfin has been received with respect to this clause. |
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• | economic and market conditions affecting the shipping industry in general; | |
• | supply of dry bulk vessels, including newbuildings; | |
• | demand for dry bulk vessels; | |
• | types and sizes of vessels; | |
• | other modes of transportation; | |
• | cost of newbuildings; | |
• | new regulatory requirements from governments or self-regulated organizations; and |
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• | prevailing level of charter rates. |
• | locating and acquiring suitable vessels at competitive prices; | |
• | identifying and consummating acquisitions or joint ventures; | |
• | integrating any acquired vessels successfully with our existing operations; | |
• | enhancing our customer base; | |
• | managing our expansion; and | |
• | obtaining required financing, which could include debt, equity or combinations thereof. |
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• | a decrease in available financing for vessels; | |
• | no active secondhand market for the sale of vessels; | |
• | a sharp decline in charter rates, particularly for vessels employed in the spot market; | |
• | charterers seeking to renegotiate the rates for existing time charters; | |
• | widespread loan covenant defaults in the dry bulk shipping industry due to the substantial decrease in vessel values; and |
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• | declaration of bankruptcy by some operators, charterers and shipowners. |
• | demand for and production of dry bulk products; | |
• | the distance cargo is to be moved by sea; | |
• | global and regional economic and political conditions; | |
• | environmental and other regulatory developments; and | |
• | changes in seaborne and other transportation patterns, including changes in the distances over which cargo is transported due to geographic changes in where commodities are produced and cargoes are used. |
• | the number of new vessel deliveries; | |
• | the scrapping rate of older vessels; | |
• | vessel casualties; | |
• | the price of steel; | |
• | the number of vessels that are out of service; | |
• | changes in environmental and other regulations that may limit the useful life of vessels; and | |
• | port or canal congestion. |
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• | crew strikesand/or boycotts; | |
• | marine disaster; | |
• | piracy; | |
• | environmental accidents; | |
• | cargo and property losses or damage; and | |
• | business interruptions caused by mechanical failure, human error, war, terrorism, political action in various countries or adverse weather conditions. |
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• | quarterly variations in our results of operations; | |
• | our lenders’ willingness to extend our loan covenant waivers, if necessary; | |
• | changes in market valuations of similar companies and stock market price and volume fluctuations generally; | |
• | changes in earnings estimates or publication of research reports by analysts; | |
• | speculation in the press or investment community about our business or the shipping industry generally; | |
• | strategic actions by us or our competitors such as acquisitions or restructurings; | |
• | the thin trading market for our common stock, which makes it somewhat illiquid; | |
• | the current ineligibility of our common stock to be the subject of margin loans because of its low current market price; | |
• | regulatory developments; | |
• | additions or departures of key personnel; | |
• | general market conditions; and | |
• | domestic and international economic, market and currency factors unrelated to our performance. |
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• | authorize our board of directors to issue “blank check” preferred stock without shareholder approval; | |
• | provide for a classified board of directors with staggered, three-year terms; | |
• | require a super-majority vote in order to amend the provisions regarding our classified board of directors with staggered, three-year terms; | |
• | permit the removal of any director from office at any time, with or without cause, at the request of the shareholder group entitled to designate such director; | |
• | allow vacancies on the board of directors to be filled by the shareholder group entitled to name the director whose resignation or removal led to the occurrence of the vacancy; | |
• | require that our board of directors fill any vacancies on the shipping committee with the nominees selected by the party that nominated the person whose resignation or removal has caused such vacancies; and | |
• | prevent our board of directors from dissolving the shipping committee or altering the duties or composition of the shipping committee without an affirmative vote of not less than 80% of the board of directors. |
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• | a majority of our board of directors must be independent directors; | |
• | the compensation of our chief executive officer must be determined or recommended by a majority of the independent directors or a compensation committee comprised solely of independent directors; | |
• | our director nominees must be selected or recommended by a majority of the independent directors or a nomination committee comprised solely of independent directors; and | |
• | certain issuances of 20% or more of our common stock must be subject to shareholder approval. |
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• | our future operating or financial results; | |
• | our financial condition and liquidity, including our ability to obtain additional financing in the future to fund capital expenditures, acquisitions and other general corporate activities; | |
• | our ability to pay dividends in the future; | |
• | dry bulk shipping industry trends, including charter rates and factors affecting vessel supply and demand; | |
• | future, pending or recent acquisitions, business strategy, areas of possible expansion, and expected capital spending or operating expenses; | |
• | the useful lives and changes in the value of our vessels and their impact on our compliance with loan covenants; | |
• | availability of crew, number of off-hire days, dry-docking requirements and insurance costs; | |
• | global and regional economic and political conditions; | |
• | our ability to leverage Safbulk’s and EST’s relationships and reputation in the dry bulk shipping industry; | |
• | changes in seaborne and other transportation patterns; | |
• | changes in governmental rules and regulations or actions taken by regulatory authorities; | |
• | potential liability from future litigation and incidents involving our vessels; | |
• | acts of terrorism and other hostilities; and | |
• | other factors discussed in the section titled “Risk Factors.” |
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Common Stock | Warrants | Units* | ||||||||||||||||||||||
High | Low | High | Low | High | Low | |||||||||||||||||||
Annual highs and lows | ||||||||||||||||||||||||
2007 | $ | 9.67 | $ | 9.26 | $ | 1.66 | $ | 1.13 | $ | 10.94 | $ | 9.83 | ||||||||||||
2008 | $ | 10.00 | $ | 3.15 | $ | 2.62 | $ | 0.11 | $ | 11.90 | $ | 6.50 | ||||||||||||
Quarterly highs and lows | ||||||||||||||||||||||||
2007 | ||||||||||||||||||||||||
Quarter ended 12/31/2007 | $ | 9.48 | $ | 9.08 | $ | 1.66 | $ | 1.13 | $ | 10.94 | $ | 10.17 | ||||||||||||
2008 | ||||||||||||||||||||||||
Quarter ended 03/31/2008 | $ | 9.48 | $ | 9.01 | $ | 1.35 | $ | 0.37 | $ | 10.61 | $ | 9.45 | ||||||||||||
Quarter ended 06/30/2008 | $ | 10.00 | $ | 9.15 | $ | 2.62 | $ | 0.42 | $ | 12.31 | $ | 9.47 | ||||||||||||
Quarter ended 09/30/02008 | $ | 10.00 | $ | 7.21 | $ | 2.50 | $ | 0.75 | $ | 11.90 | $ | 8.70 | ||||||||||||
Quarter ended 12/31/2008 | $ | 8.55 | $ | 3.15 | $ | 0.92 | $ | 0.11 | $ | 9.10 | $ | 6.50 | ||||||||||||
2009 | ||||||||||||||||||||||||
Quarter ended 3/31/2009** | $ | 5.35 | $ | 3.68 | $ | 0.22 | $ | 0.06 | N/A | N/A | ||||||||||||||
Quarter ended 6/30/2009** | $ | 4.50 | $ | 3.25 | $ | 0.28 | $ | 0.08 | N/A | N/A | ||||||||||||||
Quarter ended 9/30/2009** | $ | 4.94 | $ | 3.56 | $ | 0.28 | $ | 0.18 | N/A | N/A | ||||||||||||||
Quarter ended 12/31/2009*** | $ | 4.50 | $ | 3.03 | $ | 0.24 | $ | 0.18 | N/A | N/A | ||||||||||||||
Monthly highs and lows | ||||||||||||||||||||||||
2009 | ||||||||||||||||||||||||
May 2009** | $ | 4.25 | $ | 3.49 | $ | 0.20 | $ | 0.14 | N/A | N/A | ||||||||||||||
June 2009** | $ | 4.50 | $ | 3.41 | $ | 0.28 | $ | 0.18 | N/A | N/A | ||||||||||||||
July 2009** | $ | 4.39 | $ | 3.56 | $ | 0.28 | $ | 0.25 | N/A | N/A | ||||||||||||||
August 2009** | $ | 4.94 | $ | 3.98 | $ | 0.24 | $ | 0.20 | N/A | N/A | ||||||||||||||
September 2009** | $ | 4.80 | $ | 4.01 | $ | 0.28 | $ | 0.18 | N/A | N/A | ||||||||||||||
October 2009** | $ | 4.50 | $ | 3.69 | $ | 0.22 | $ | 0.18 | N/A | N/A | ||||||||||||||
November 2009*** | $ | 4.09 | $ | 3.03 | $ | 0.24 | $ | 0.18 | N/A | N/A |
* | Seanergy Maritime’s common stock, warrants and units were previously listed on the American Stock Exchange. On October 15, 2008, Seanergy Maritime’s common stock and warrants commenced trading on the Nasdaq Stock Market. Seanergy Maritime’s units were separated prior to being listed on the Nasdaq Stock Market and, therefore, were not listed on the Nasdaq Stock Market. Seanergy Maritime’s units stopped trading on the American Stock Exchange on October 14, 2008 and were not listed on the Nasdaq Stock Market. | |
** | Following the dissolution of Seanergy Maritime, our common stock started trading on the Nasdaq Stock Market on January 28, 2009. |
*** | Period ended November 17, 2009. |
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• | on a historical basis without any adjustment to reflect subsequent events; |
• | an as adjusted basis for the sale of up to $ shares to the public and $ in the current sale net of underwriters’ discounts and commissions, offering expenses, and after receipt and application of net proceeds. |
As | ||||||||
Historical | Adjusted | |||||||
(In thousands) | ||||||||
Debt: | ||||||||
Long-term revolving credit financing (secured) | $ | 54,845 | $ | |||||
Long-term term facility financing (secured), including current portion of $33,206 | 252,850 | |||||||
Total debt | $ | 307,695 | $ | |||||
Shareholders’ equity: | ||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued | ||||||||
Common stock, $0.0001 par value; 200,000,000 and 89,000,000 authorized shares as at September 30, 2009 and December 31, 2008, respectively; 28,947,095 and 22,361,227 shares, issued and outstanding as at September 30, 2009 and December 31, 2008, respectively | $ | 3 | ||||||
Additional paid-in capital | 213,232 | |||||||
Accumulated deficit | (1,533 | ) | ||||||
Noncontrolling interest | 16,746 | |||||||
Total equity | $ | 228,448 | $ | |||||
Total capitalization | $ | 536,143 | $ | |||||
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Adjusted as of | ||||||||
September 30, 2009 | September 30, 2009(2) | |||||||
Assumed offering price per share in this offering | ||||||||
Net tangible book value per share | ||||||||
Increase in net tangible book value per share attributable to new investors in this offering | ||||||||
Pro forma net tangible book value per share after giving effect to this Offering | ||||||||
Dilution per share to the new investors(1) |
(1) | Each $1.00 increase (decrease) in the assumed public offering price of $ per share would increase (decrease) our as adjusted net tangible book value by $ million, or $ per share, and increase (decrease) dilution in net tangible book value per share to investors in this offering by $ per share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions, and offering expenses. The information in the table above is illustrative only, and following the completion of this offering, our capitalization will be adjusted based on the actual public offering price and other terms of this offering determined at pricing. |
(2) | Represents the dilution and appreciation as of September 30, 2009 after giving effect to the issuance of 4,308,075 shares of our common stock upon achievement of certain EBITDA targets. |
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Pro Forma Shares | Average | |||||||||||||||||||
Outstanding | Total Consideration | Price per | ||||||||||||||||||
Number | Percentage | Amount | Percentage | Share | ||||||||||||||||
Existing shareholders | ||||||||||||||||||||
Shareholders of shares issued achievement of EBITDA target | ||||||||||||||||||||
New investors | ||||||||||||||||||||
Total | ||||||||||||||||||||
• | the pro forma percentage of shares of our common stock held by existing shareholders will decrease to approximately % of the total number of pro forma shares of our common stock outstanding after this offering; and | |
• | the number of shares of our common stock held by new investors will increase to , or approximately % of the total number of shares of our common stock outstanding after this offering. |
• | 1,000,000 shares of common stock included in the units issuable upon exercise of the option at an exercise price of $12.50 per unit; |
• | 1,000,000 shares of common stock issuable for $6.50 per share upon exercise of the warrants underlying the units issuable upon exercise of the option; and |
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From | ||||||||||||||||||||||||||||
Inception | ||||||||||||||||||||||||||||
Three Months | Nine Months | (August 15, | ||||||||||||||||||||||||||
Ended | Ended | Years Ended | 2006) to | |||||||||||||||||||||||||
September 30, | September 30, | December 31, | December 31, | |||||||||||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2008 | 2007 | 2006 | ||||||||||||||||||||||
Statement of Operations Data: | ||||||||||||||||||||||||||||
Vessel revenue — related party, net | 20,485 | 6,122 | 68,795 | 6,122 | 34,453 | — | — | |||||||||||||||||||||
Vessel revenue, net | 1,867 | — | 1,867 | — | — | — | — | |||||||||||||||||||||
Direct voyage expenses | (42 | ) | (143 | ) | (480 | ) | (143 | ) | (151 | ) | — | — | ||||||||||||||||
Vessel operating expense | (3,935 | ) | (719 | ) | (9,756 | ) | (719 | ) | (3,180 | ) | — | |||||||||||||||||
Voyage expenses — related party | (222 | ) | (77 | ) | (841 | ) | (77 | ) | (440 | ) | — | |||||||||||||||||
Management fees — related party | (462 | ) | (82 | ) | (1,078 | ) | (82 | ) | (388 | ) | — | |||||||||||||||||
General and administration expenses | (1,014 | ) | (208 | ) | (3,083 | ) | (805 | ) | (1,840 | ) | (445 | ) | (5 | ) | ||||||||||||||
General and administration expenses — related party | (459 | ) | (50 | ) | (1,553 | ) | (50 | ) | (430 | ) | — | — | ||||||||||||||||
Amortization of dry-docking costs | (387 | ) | — | (397 | ) | — | — | — | — | |||||||||||||||||||
Depreciation | (5,286 | ) | (1,488 | ) | (20,716 | ) | (1,488 | ) | (9,929 | ) | — | — | ||||||||||||||||
Gain from acquisition | 6,813 | — | 6,813 | — | — | — | — | |||||||||||||||||||||
Goodwill impairment loss | — | — | — | — | (44,795 | ) | — | — | ||||||||||||||||||||
Vessels’ impairment loss | — | — | — | — | (4,530 | ) | ||||||||||||||||||||||
Interest income — money market fund | 108 | 644 | 363 | 3,257 | 3,361 | 1,948 | 1 | |||||||||||||||||||||
Interest and finance costs | (3,525 | ) | (730 | ) | (6,656 | ) | (730 | ) | (4,077 | ) | (58 | ) | — | |||||||||||||||
Foreign currency exchange (losses), net | (25 | ) | 1 | (80 | ) | 1 | (39 | ) | — | — | ||||||||||||||||||
Net income (loss) | 13,916 | 3,270 | 33,198 | 5,286 | (31,985 | ) | 1,445 | (4 | ) | |||||||||||||||||||
Net (loss) attributable to noncontrolling interest | (67 | ) | — | (67 | ) | — | ||||||||||||||||||||||
Net income attributable to Seanergy Maritime | 13,983 | 3,270 | 33,265 | 5,286 | ||||||||||||||||||||||||
Basic income (loss) per share | 0.57 | 0.12 | 1.44 | 0.19 | (1.21 | ) | 0.12 | (0.00 | ) | |||||||||||||||||||
Diluted income (loss) per share | 0.46 | 0.10 | 1.13 | 0.16 | (1.21 | ) | 0.10 | (0.00 | ) | |||||||||||||||||||
Basic weighted average number of shares | 24,580,378 | 26,314,831 | 23,109,073 | 27,829,907 | 26,452,291 | 11,754,095 | 7,264,893 | |||||||||||||||||||||
Diluted weighted average number of shares | 30,386,931 | 32,882,906 | 29,420,518 | 34,397,982 | 26,452,291 | 15,036,283 | 7,264,893 | |||||||||||||||||||||
Dividends per share | — | — | — | — | $ | 0.1842 | — | — | ||||||||||||||||||||
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September 30, | December 31, | |||||||||||||||
2009 | 2008 | 2007 | 2006 | |||||||||||||
Balance Sheet Data: | ||||||||||||||||
Total current assets | 70,986 | 29,814 | 235,213 | 376 | ||||||||||||
Vessels, net | 450,920 | 345,622 | — | — | ||||||||||||
Total assets | 547,140 | 378,202 | 235,213 | 632 | ||||||||||||
Total current liabilities, including current portion of long-term debt | 37,651 | 32,999 | 5,995 | 611 | ||||||||||||
Long-term debt, net of current portion | 274,489 | 213,638 | — | — | ||||||||||||
Total equity | 228,448 | 131,565 | 148,369 | 20 |
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AND RESULTS OF OPERATIONS FOR SEANERGY MARITIME AND SEANERGY
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• | Ownership days. Ownership days are the total number of calendar days in a period during which we owned each vessel in our fleet. Ownership days are an indicator of the size of the fleet over a period and affect both the amount of revenues and the amount of expenses recorded during that period. | |
• | Available days. Available days are the number of ownership days less the aggregate number of days that our vessels are off-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels should be capable of generating revenues. | |
• | Operating days. Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
• | Fleet utilization. Fleet utilization is determined by dividing the number of operating days during a period by the number of ownership days during that period. The shipping industry uses fleet utilization to measure a company’s efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for any reason excluding scheduled repairs, vessel upgrades, dry-dockings or special or intermediate surveys. | |
• | Off-hire. The period a vessel is unable to perform the services for which it is required under a charter. | |
• | Time charter. A time charter is a contract for the use of a vessel for a specific period of time during which the charterer pays substantially all of the voyage expenses, including port costs, canal charges and fuel expenses. The vessel owner pays the vessel operating expenses, which include crew wages, insurance, technical maintenance costs, spares, stores and supplies and commissions on gross voyage revenues. Time charter rates are usually fixed during the term of the charter. Prevailing time charter rates do fluctuate on a seasonal and year-to-year basis and may be substantially higher or lower from a prior time charter agreement when the subject vessel is seeking to renew the time charter agreement with the existing charterer or enter into a new time charter agreement with another charterer. Fluctuations in time charter rates are influenced by changes in spot charter rates. |
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• | TCE. Time charter equivalent or TCE rates are defined as our time charter revenues less voyage expenses during a period divided by the number of our Operating days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. |
• | The nature and duration of our charters; | |
• | The amount of time that we spent repositioning our vessels; |
• | The amount of time that our vessels spent in dry-dock undergoing repairs; |
• | Maintenance and upgrade work; | |
• | The age, condition and specifications of our vessels; | |
• | The levels of supply and demand in the dry bulk carrier transportation market; and | |
• | Other factors affecting charter rates for dry bulk carriers under voyage charters. |
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• | Number of vessels owned and operated; | |
• | Charter market rates and periods of charter hire; |
• | Vessel operating expenses and direct voyage costs, which were incurred in both U.S. dollars and other currencies, primarily Euros; |
• | Depreciation expenses, which are a function of vessel cost, any significant post-acquisition improvements, estimated useful lives, estimated residual scrap values, and fluctuations in the market value of our vessels; | |
• | Financing costs related to indebtedness associated with the vessels; and | |
• | Fluctuations in foreign exchange rates. |
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Three Months Ended | Nine Months Ended | Year Ended | ||||||||||
September 30, 2009 | September 30, 2009 | December 31, 2008 | ||||||||||
Fleet Data: | ||||||||||||
Average number of vessels(1) | 8.7 | 6.9 | 5.5 | |||||||||
Ownership days(2) | 797 | 1,883 | 686 | |||||||||
Available days(3) | 739 | 1,654 | 686 | |||||||||
Operating days(4) | 735 | 1,646 | 678 | |||||||||
Fleet utilization(5) | 92.2 | % | 87.4 | % | 98.9 | % | ||||||
Average Daily Results: | ||||||||||||
Vessel TCE rate(6) | 30,052 | 42,127 | 49,362 | |||||||||
Vessel operating expenses(7) | 4,937 | 5,181 | 4,636 | |||||||||
Management fees(8) | 580 | 572 | 566 | |||||||||
Total vessel operating expenses | 5,517 | 5,753 | 5,202 |
(1) | Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the relevant period divided by the number of calendar days in the relevant period. | |
(2) | Ownership days are the total number of days in a period during which the vessels in a fleet have been owned. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we recorded during a period. |
(3) | Available days are the number of ownership days less the aggregate number of days that vessels areoff-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels should be capable of generating revenues. During the three months ended September 30, 2009, we incurred 58 off-hire days for vessel scheduled dry-docking. During the nine months ended September 30, 2009, we incurred 229off-hire days for vessel scheduled dry-docking. |
(4) | Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
(5) | Fleet utilization is the percentage of time that our vessels were generating revenue, and is determined by dividing operating days by ownership days for the relevant period. | |
(6) | Time charter equivalent, or TCE, rates are defined as our time charter revenues less voyage expenses during a period divided by the number of our operating days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. |
Three Months Ended | Nine Months Ended | Year Ended | ||||||||||
September 30, 2009 | September 30, 2009 | December 31, 2008 | ||||||||||
(In thousands of U.S. dollars, except operating day amounts) | ||||||||||||
Net revenues from vessels | 22,352 | 70,662 | 34,453 | |||||||||
Voyage expenses | (42 | ) | (480 | ) | (151 | ) | ||||||
Voyage expenses — related party | (222 | ) | (841 | ) | (440 | ) | ||||||
Net operating revenues | 22,088 | 69,341 | 33,862 | |||||||||
Operating days | 735 | 1,646 | 686 | |||||||||
Time charter equivalent rate | 30,052 | 42,127 | 49,362 |
(7) | Average daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs, are calculated by dividing vessel operating expenses by ownership days for the relevant time periods: |
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Three Months Ended | Nine Months Ended | Year Ended | ||||||||||
September 30, 2009 | September 30, 2009 | December 31, 2008 | ||||||||||
(In thousands of U.S. dollars, except ownership days amounts) | ||||||||||||
Operating expenses | 3,935 | 9,756 | 3,180 | |||||||||
Ownership days | 797 | 1,883 | 686 | |||||||||
Daily vessel operating expenses | 4,937 | 5,181 | 4,636 |
(8) | Daily management fees are calculated by dividing total management fees by ownership days for the relevant time period. |
September 30, 2008
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• | not to borrow any money or permit such borrowings to continue other than by way of subordinated shareholders’ loans or enter into any agreement for deferred terms, other than in any customary supplier’s credit terms or any equipment lease or contract hire agreement other than in the ordinary course of business; |
• | no loans, advances or investments in, any person, firm, corporation or joint venture or to any officer director, shareholder or customer; | |
• | not to assume, guarantee or otherwise undertake the liability of any person, firm, or company; |
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• | not to authorize any capital commitments; | |
• | not to declare or pay dividends in any amount greater than 60% of the net cash flow of Seanergy, on a consolidated basis as determined by the lender on the basis of the most recent annual audited financial statements provided, or repay any shareholder’s loans or make any distributions in excess of the above amount without the lenders’ prior written consent (see below for terms of waiver obtained on December 31, 2008); | |
• | not to change our Chief Executive Officerand/or Chairman without the prior written consent of the lender; | |
• | not to assign, transfer, sell or otherwise dispose of vessels or any of the property, assets or rights without the prior written consent of the lender; | |
• | to ensure that the members of the Restis and Koutsolioutsos families (or companies affiliated with them) own at all times an aggregate of at least 10% of our issued share capital; | |
• | no change of control without the written consent of the lender; | |
• | not to engage in any business other than the operation of the vessels without the prior written consent of the lender; and |
• | not to violate the security margin clause, which provides that: the aggregate market values of the vessels and the value of any additional security shall not be less than (or at least) 135% of the aggregate of the outstanding amounts under the revolving credit and term facilities and any amount available for drawing under the revolving facility, less the aggregate amount of all deposits maintained. As of December 31, 2008, we would not have been in compliance with the security margin clause under the Marfin loan agreement had we not later obtained certain retroactive waivers from Marfin. During the first quarter of 2009, we obtained waivers from Marfin of our compliance with these various financial and other covenants, which waivers were effective as of December 31, 2008. These waivers expired in July 2009, when the first of our original charterers was replaced. On September 9, 2009 and November 13, 2009, we executed addenda no. 1 and no. 2, respectively, to the loan agreement and obtained a waiver from Marfin through January 1, 2011. In connection with the amendment and waiver, Marfin made certain changes to our loan agreement including increasing the interest payable during the waiver period, accelerating the due dates of certain principal installments and limiting our ability to pay dividends without their prior consent. As a result of these waivers, we are not currently in default under our Marfin loan agreement. |
• | ratio of financial indebtedness to earnings, before interest, taxes, depreciation and amortization (EBITDA) shall be less than 6.5:1 (financial indebtedness or net debt are defined is the sum of all outstanding debt facilities minus cash and cash equivalents). The covenant is to be tested quarterly on an LTM basis (the “last twelve months”). The calculation of the covenant is not applicable for the quarter ended December 31, 2008. | |
• | the ratio of LTM (“last twelve months”) EBITDA to net interest expense shall not be less than 2:1. The covenant is to be tested quarterly on a LTM basis. The calculation of the covenant is not applicable for the quarter ended December 31, 2008. | |
• | the ratio of total liabilities to total assets shall not exceed 0.70:1; | |
• | unrestricted cash deposits, other than in favor of the lender shall not be less than 2.5% of the financial indebtedness; and | |
• | average quarterly unrestricted cash deposits, other than in favor of the lender, shall not be less than 5% of the financial indebtedness. |
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• | Not to permit any lien to be created over all or any part of the borrowers’ present or future undertakings, assets, rights or revenues to secure any present or future indebtedness; | |
• | Not to merge or consolidate with any other person; |
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• | Not to sell, transfer, dispose of or exercise direct control over any part of the borrowers’ assets, rights or revenue without the consent of the lender; | |
• | Not to undertake any business other than the ownership and operation of vessels and the chartering of vessels to third parties; | |
• | Not to acquire any assets other than the BET vessels; | |
• | Not to incur any obligations except under the loan agreement and related documents or contracts entered into in the ordinary course of business; | |
• | Not to borrow money other than pursuant to the loan agreement, except that the borrowers may borrow money from their shareholders or directors or their related companies as long as such borrowings are subordinate to amounts due under the loan agreement; | |
• | Not to guarantee, indemnify or become contingently liable for the obligations of another person or entity except pursuant to the loan agreement and related documents, except, in general, for certain guarantees that arise in the ordinary course of business; | |
• | Not to make any loans or grant any credit to any person, except that the borrowers make loans to BET or the borrowers’ related companies as long as they are made on an arm’s length basis in the ordinary course of business and are fully subordinated to the rights of the lender; | |
• | Not to redeem their own shares of stock; | |
• | Not to permit any change in the legal or beneficial ownership of any of the borrowers or BET or cause any change in the shareholders’ agreement or constitutional documents related to BET; and | |
• | Not to enter into any related party transactions except on an arm’s length basis and for full value. |
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Vessel | Next Schedule Dry-Dock | Estimated Cost | ||||
African Oryx | October 2010 | $ | 900,000 | |||
African Zebra | February 2011 | $ | 1,000,000 | |||
Bremen Max | June 2011 | $ | 1,000,000 | |||
Hamburg Max | June 2012 | $ | 1,000,000 | |||
Davakis G. | May 2011 | $ | 500,000 | |||
Delos Ranger | August 2011 | $ | 500,000 | |||
BET Commander* | August 2011 | $ | 1,200,000 | |||
BET Fighter* | September 2010 | $ | 1,200,000 | |||
BET Prince* | May 2010 | $ | 1,200,000 | |||
BET Scouter* | April 2010 | $ | 1,200,000 | |||
BET Intruder* | March 2011 | $ | 1,000,000 |
* | Vessels owned by BET |
Reducing revolving | ||||||||||||
Term Facility | credit facility | Total | ||||||||||
2009 | 7,128 | 0 | 7,128 | |||||||||
2010 | 33,206 | 0 | 33,206 | |||||||||
2011 | 27,056 | 6,845 | 33,902 | |||||||||
2012 | 27,056 | 12,000 | 39,056 | |||||||||
2013 | 27,056 | 12,000 | 39,056 | |||||||||
Thereafter | 131,348 | 24,000 | 155,347 | |||||||||
252,850 | 54,845 | 307,695 | ||||||||||
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2014 and | ||||||||||||||||||||||||||||
2009 | 2010 | 2011 | 2012 | 2013 | Thereafter | Total | ||||||||||||||||||||||
(in thousands of U.S. dollars) | ||||||||||||||||||||||||||||
Seanergy | ||||||||||||||||||||||||||||
Revolving credit facility(1) | 0 | 0 | 6,845 | 12,000 | 12,000 | 24,000 | 54,845 | |||||||||||||||||||||
Interest on revolving credit | 514 | 2,194 | 2,185 | 1,785 | 1,275 | 1,148 | 9,101 | |||||||||||||||||||||
facility(2) | ||||||||||||||||||||||||||||
Property leases(3) | 188 | 759 | 681 | 1,628 | ||||||||||||||||||||||||
Term facility | 0 | 18,950 | 12,800 | 12,800 | 12,800 | 72,400 | 129,750 | |||||||||||||||||||||
Interest on term facility(4) | 1,054 | 4,118 | 3,975 | 3,495 | 3,015 | 4,121 | 19,778 | |||||||||||||||||||||
Management fees(5) | 345 | 1,368 | 1,396 | 1,427 | 1,452 | 5,988 | ||||||||||||||||||||||
BET | ||||||||||||||||||||||||||||
Term facility | 7,128 | 14,256 | 14,256 | 14,256 | 14,256 | 58,948 | 123,100 | |||||||||||||||||||||
Interest on term facility(6) | 769 | 2,810 | 2,699 | 2,307 | 1,915 | 2,137 | 12,637 | |||||||||||||||||||||
Management fees | 287 | 1,140 | 1,163 | 1,189 | 1,210 | 4,989 |
(1) | Commencing one year from signing the loan agreement, the revolving facility is reduced to the applicable limit available on such reduction date. The first annual reduction, which reduced the available credit amount by $18,000,000 to $72,000,000 in August 2009, will be followed by five consecutive annual reductions of $12,000,000 and any outstanding balance must be fully repaid together with the balloon payment of the term loan. The annual principal payments on the revolving credit facility are based on the amount drawn down as of September 30, 2009. |
(2) | The revolving credit facility bears interest at LIBOR plus a spread of 2.25%. As part of the new waiver, the spread will be increased to 3.50% until expiration of the waiver period. Interest has been computed by using a LIBOR rate of 0.5% through the end of 2010 and 2% thereafter. |
(3) | The property lease reflects our lease agreement with Waterfront for the lease of our executive offices. The initial lease term is for a period of three years with an option to extend for one more year. The lease |
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payments are €42,000 per month. The monthly payment due under the property lease in U.S. dollars has been computed by using a Euro/U.S. dollar exchange rate as of September 30, 2009, which was €1.00:$1.47. |
(4) | The term facility bears interest at a three-month LIBOR plus spread of 1.75%. As part of the new waiver, the spread will be increased to 3.00% until expiration of the waiver period. Interest has been computed by using a LIBOR rate of 0.5% through the end of 2010 and 2% thereafter. |
(5) | Management fees for 2009 are Euro 425 per vessel per day, which thereafter are adjusted on an annual basis as defined per the agreement. Management fees in the dollars have been computed by using a Euro/U.S. dollar exchange rate as of September 30, 2009, which was €1.00:$1.47, an assumption of 2% increase annually and 365 days per year. |
(6) | The term facility for BET bears interest at a three-month LIBOR plus a spread of 0.75%. Pursuant to the supplemental agreement, the spread increased to 2% until July 1, 2010. Interest has been computed by using a LIBOR rate of 0.5% through the end of 2010 and 2% thereafter. |
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AND RESULTS OF OPERATIONS FOR THE VESSELS PREVIOUSLY OWNED BY SELLERS
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Date of Delivery to | ||||||||||||
Vessel Name | Dwt | Vessel Type | Built | Seanergy | ||||||||
African Oryx | 24,110 | Handysize | 1997 | August 28, 2008 | ||||||||
African Zebra | 38,632 | Handymax | 1985 | September 25, 2008 | ||||||||
Bremen Max | 73,503 | Panamax | 1993 | September 11, 2008 | ||||||||
Hamburg Max | 73,498 | Panamax | 1994 | September 25, 2008 | ||||||||
Davakis G. (ex. Hull NO. KA 215) | 54,000 | Supramax | 2008 | August 28, 2008 | ||||||||
Delos Ranger (ex. Hull No. KA 216) | 54,000 | Supramax | 2008 | August 28, 2008 |
• | Ownership days. Ownership days are the total number of calendar days in a period during which the sellers owned each vessel in their fleet. Ownership days are an indicator of the size of the fleet over a period and affect both the amount of revenues and the amount of expenses recorded during that period. | |
• | Available days. Available days are the number of ownership days less the aggregate number of days that the sellers’ vessels are off-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels are actually capable of generating revenues. | |
• | Operating days. Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
• | Fleet utilization. Fleet utilization is determined by dividing the number of operating days during a period by the number of ownership days during that period. The shipping industry uses fleet utilization to measure a company’s efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for any reason including scheduled repairs, vessel upgrades, dry-dockings or special or intermediate surveys. | |
• | Off-hire. The period a vessel is unable to perform the services for which it is required under a charter. | |
• | Time charter. A time charter is a contract for the use of a vessel for a specific period of time during which the charterer pays substantially all of the voyage expenses, including port costs, canal charges and fuel expenses. The vessel owner pays the vessel operating expenses, which include crew wages, insurance, technical maintenance costs, spares, stores and supplies and commissions on gross voyage revenues. Time charter rates are usually fixed during the term of the charter. Prevailing time charter rates do fluctuate on a seasonal and year-to-year basis and may be substantially higher or lower from a prior time charter agreement when the subject vessel is seeking to renew the time charter agreement with the existing charterer or enter into a new time charter agreement with another charterer. Fluctuations in time charter rates are influenced by changes in spot charter rates. | |
• | Voyage charter. A voyage charter is an agreement to charter the vessel for an agreed per-ton amount of freight from specified loading port(s) to specified discharge port(s). In contrast to a time charter, the vessel owner is required to pay substantially all of the voyage expenses, including port costs, canal charges and fuel expenses, in addition to the vessel operating expenses. | |
• | TCE. Time charter equivalent, or TCE, is a measure of the average daily revenue performance of a vessel on a per voyage basis. The sellers’ method of calculating TCE is consistent with industry standards and is determined by dividing operating revenues (net of voyage expenses) by operating days for the relevant time period. Voyage expenses primarily consist of port, canal and fuel costs that are |
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unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract. TCE is a standard shipping industry performance measure used primarily to compareperiod-to-period changes in a shipping company’s performance despite changes in the mix of charter types (i.e., spot charters, time charters and bareboat charters) under which the vessels may be employed between the periods. |
• | The nature and duration of the sellers’ charters; | |
• | The amount of time that the sellers’ spent repositioning their vessels; | |
• | The amount of time that the sellers’ vessels spent in dry-dock undergoing repairs; | |
• | Maintenance and upgrade work; | |
• | The age, condition and specifications of the sellers’ vessels; | |
• | The levels of supply and demand in the dry bulk carrier transportation market; and | |
• | Other factors affecting charter rates for dry bulk carriers under voyage charters. |
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• | Number of vessels owned and operated; | |
• | Charter market rates and periods of charter hire; |
• | Vessel operating expenses and voyage costs, which were incurred in both U.S. dollars and other currencies, primarily Euros; |
• | Cost of dry-docking and special surveys; | |
• | Depreciation expenses, which were a function of the cost, any significant post-acquisition improvements, estimated useful lives and estimated residual scrap values of sellers’ vessels; | |
• | Financing costs related to indebtedness associated with the vessels; and | |
• | Fluctuations in foreign exchange rates. |
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Twelve Months Ended | ||||||||||||||||||||
Six Months Ended June 30, | December 31, | |||||||||||||||||||
2007 | 2008 | 2007 | 2006 | 2005 | ||||||||||||||||
Fleet Data: | ||||||||||||||||||||
Average number of vessels(1) | 4.21 | 3.83 | 3.85 | 3.81 | 3.21 | |||||||||||||||
Ownership days(2) | 769 | 724 | 1,460 | 1,460 | 1,250 | |||||||||||||||
Available days(3) (equals operating days for the periods listed(4)) | 767 | 693 | 1,411 | 1,393 | 1,166 | |||||||||||||||
Fleet utilization(5) | 99.7 | % | 95.7 | % | 96.6 | % | 95.4 | % | 93.3 | % | ||||||||||
Average Daily Results: | ||||||||||||||||||||
Average TCE rate(6) | 35,812 | 24,706 | 25,256 | 18,868 | 23,170 | |||||||||||||||
Vessel operating expenses(7) | 5,168 | 3,887 | 4,130 | 3,849 | 4,049 | |||||||||||||||
Management fees(8) | 535 | 535 | 535 | 515 | 515 | |||||||||||||||
Total vessel operating expenses | 5,703 | 4,422 | 4,665 | 4,364 | 4,564 |
(1) | Average number of vessels is the number of vessels the sellers owned for the relevant period, as measured by the sum of the number of days each vessel was owned during the period divided by the number of calendar days in the period. |
(2) | Ownership days are the total number of days in a period during which the sellers owned each vessel. Ownership days are an indicator of the size of the sellers’ fleet over a period and affect both the amount of revenues and the amount of expenses that sellers recorded during a period. | |
(3) | Available days are the number of ownership days less the aggregate number of days that the sellers’ vessels were off-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels should be capable of generating revenues. | |
(4) | Operating days are the number of available days in a period less the aggregate number of days that the sellers�� vessels were off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
(5) | Fleet utilization is determined by dividing the number of operating days during a period by the number of ownership days during that period. The shipping industry uses fleet utilization to measure a company’s efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for any reason excluding scheduled repairs, vessel upgrades, dry-dockings or special or intermediate surveys. | |
(6) | Time charter equivalent, is a measure of the average daily revenue performance of a vessel on a per voyage basis. The sellers’ method of calculating TCE was consistent with industry standards and was determined by dividing operating revenues (net of voyage expenses and commissions) by operating days for the relevant time period. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract. TCE is a standard shipping industry performance measure used primarily to compare period-to-period changes in a |
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shipping company’s performance despite changes in the mix of charter types (i.e., spot charters, time charters and bareboat charters) under which the vessels may be employed between the periods: | ||
The following table is unaudited and includes information that is extracted directly from the combined financial statements, as well as other information used by the sellers for monitoring performance. |
Six Months Ended | Twelve Months Ended | |||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||
2008 | 2007 | 2007 | 2006 | 2005 | ||||||||||||||||
(Dollars in thousands except per diem amounts) | ||||||||||||||||||||
Operating revenues | 28,227 | 17,181 | 35,717 | 26,347 | 27,156 | |||||||||||||||
Voyage revenues | (759 | ) | (60 | ) | (82 | ) | (64 | ) | (139 | ) | ||||||||||
Net operating revenues | 27,468 | 17,121 | 35,635 | 26,283 | 27,017 | |||||||||||||||
Operating days | 767 | 693 | 1,411 | 1,393 | 1,166 | |||||||||||||||
Average TCE daily rate | 35,812 | 24,706 | 25,256 | 18,868 | 23,170 |
(7) | Average daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs, is calculated by dividing vessel operating expenses by ownership days for the relevant time periods: |
Six Months Ended | Twelve Months Ended | |||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||
2008 | 2007 | 2007 | 2006 | 2005 | ||||||||||||||||
(Dollars in thousands except per diem amounts) | ||||||||||||||||||||
Crew costs and other operating expenses | 3,974 | 2,814 | 6,031 | 5,619 | 5,061 | |||||||||||||||
Ownership days | 769 | 724 | 1,460 | 1,460 | 1,250 | |||||||||||||||
Daily vessel operating expense | 5,168 | 3,887 | 4,130 | 3,849 | 4,049 |
(8) | Daily management fees are calculated by dividing total management fees expensed on vessels owned by ownership days for the relevant time period. |
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Vessel | Financed(1) | Cash(2) | ||||||
Africa Oryx | $ | 13,851,850 | $ | 6,648,150 | ||||
Africa Zebra | $ | 9,459,800 | $ | 4,540,200 | ||||
Bremen Max | $ | 19,595,300 | $ | 9,404,700 | ||||
Hamburg Max | $ | 21,622,400 | $ | 10,377,600 | ||||
Davakis G (ex. Hull No. KA 215) | $ | 16,674,000 | $ | 7,146,000 | ||||
Delos Ranger (ex. Hull No. KA 216) | $ | 16,674,000 | $ | 7,146,000 |
(1) | Financed with the credit facilities described above. | |
(2) | Cash provided to the sellers by their shareholders. |
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Payments Due by Period | ||||||||||||||||||||
Less Than | More Than | |||||||||||||||||||
December 31, 2007 | Total | 1 Year | 1-2 Years | 2-5 Years | 5 Years | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Long-term debt(1) | 48,330 | 9,750 | 4,724 | 14,171 | 19,685 | |||||||||||||||
Management fees(2) | 3,317 | 973 | 1,172 | 1,172 | — | |||||||||||||||
Capital commitments for vessel construction | 30,840 | 30,840 | — | — | — | |||||||||||||||
Total obligations | 82,487 | 41,563 | 5,896 | 15,343 | 19,685 | |||||||||||||||
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Payments Due by Period | ||||||||||||||||||||
Less Than | More Than | |||||||||||||||||||
June 30, 2008 | Total | 1 Year | 1-2 Years | 2-5 Years | 5 Years | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Long-term debt(1) | 60,884 | 12,364 | 5,643 | 16,931 | 25,946 | |||||||||||||||
Management fees(2) | 2,901 | 1,143 | 1,172 | 586 | — | |||||||||||||||
Capital commitment for vessel construction | 11,820 | 11,820 | — | — | — | |||||||||||||||
Total obligations | 75,605 | 25,327 | 6,815 | 17,517 | 25,946 | |||||||||||||||
(1) | The long-term debt has been repaid or reallocated as of the dates the vessels were delivered to Seanergy in August and September 2008. | |
(2) | EST provides management services in exchange for a fixed fee per day for each vessel in operation. These agreements are entered into with an initial three-year term until terminated by the other party. The amounts indicated above are based on a management fee of $535 dollars per day per vessel. This management fee agreement has been terminated as of the dates the vessels were delivered to Seanergy in August and September 2008. |
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FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR BET
Vessel Name | Dwt | Vessel Type | Built | Date of Delivery | ||||||||||
BET Commander | 149,507 | Capesize | 1991 | December 17, 2007 | ||||||||||
BET Scouter | 171,175 | Capesize | 1995 | July 23, 2007 | ||||||||||
BET Fighter | 173,149 | Capesize | 1992 | August 29, 2007 | ||||||||||
BET Intruder | 69,235 | Panamax | 1993 | March 20, 2008 | ||||||||||
BET Prince | 163,554 | Capesize | 1995 | January 7, 2008 |
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• | Ownership days. Ownership days are the total number of calendar days in a period during which BET owned each vessel in its fleet. Ownership days are an indicator of the size of the fleet over a period and affect both the amount of revenues and the amount of expenses recorded during that period. | |
• | Available days. Available days are the number of ownership days less the aggregate number of days that a company’s vessels are off-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels should be capable of generating revenues. | |
• | Operating days. Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
• | Fleet utilization. Fleet utilization is determined by dividing the number of operating days during a period by the number of ownership days during that period. The shipping industry uses fleet utilization to measure a company’s efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for any reason excluding scheduled repairs, vessel upgrades, dry-dockings or special or intermediate surveys. | |
• | Off-hire. The period a vessel is unable to perform the services for which it is required under a charter. | |
• | Time charter. A time charter is a contract for the use of a vessel for a specific period of time during which the charterer pays substantially all of the voyage expenses, including port costs, canal charges and fuel expenses. The vessel owner pays the vessel operating expenses, which include crew wages, insurance, technical maintenance costs, spares, stores and supplies and commissions on gross voyage revenues. Time charter rates are usually fixed during the term of the charter. Prevailing time charter rates do fluctuate on a seasonal and year-to-year basis and may be substantially higher or lower from a prior time charter agreement when the subject vessel is seeking to renew the time charter agreement with the existing charterer or enter into a new time charter agreement with another charterer. Fluctuations in time charter rates are influenced by changes in spot charter rates. | |
• | TCE. Time charter equivalent or TCE rates are defined as our time charter revenues less voyage expenses during a period divided by the number of our operating days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. |
• | The nature and duration of BET’s charters; | |
• | The amount of time that BET’s spent repositioning its vessels; | |
• | The amount of time that BET’s vessels spent in dry-dock undergoing repairs; | |
• | Maintenance and upgrade work; | |
• | The age, condition and specifications of BET’s vessels; | |
• | The levels of supply and demand in the dry bulk carrier transportation market; and | |
• | Other factors affecting charter rates for dry bulk carriers under voyage charters. |
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• | Number of vessels owned and operated; | |
• | Charter market rates and periods of charter hire; |
• | Vessel operating expenses and voyage costs, which were incurred in both U.S. dollars and other currencies, primarily Euros; |
• | Cost of dry-docking and special surveys; | |
• | Depreciation expenses, which were a function of the cost, any significant post-acquisition improvements, estimated useful lives and estimated residual scrap values of sellers’ vessels; | |
• | Financing costs related to indebtedness associated with the vessels; | |
• | Fluctuations in foreign exchange rates; and | |
• | Impairment losses on vessels. |
Six Months Ended | Twelve Months Ended | |||||||||||
June 30, | December 31, | |||||||||||
2009 | 2008 | 2007 | ||||||||||
Fleet Data: | ||||||||||||
Average number of vessels(1) | 5 | 5.3 | 1.1 | |||||||||
Ownership days(2) | 905 | 1,937 | 397 | |||||||||
Available days(3) | 905 | 1,937 | 397 | |||||||||
Operating days(4)) | 892 | 1,811 | 392 | |||||||||
Fleet utilization(5) | 98.6 | % | 93.5 | % | 98.71 | % | ||||||
Average Daily Results: | ||||||||||||
Average TCE rate(6) | 16,768 | 32,604 | 13,622 | |||||||||
Vessel operating expenses(7) | 5,997 | 6,196 | 7,091 | |||||||||
Management fees(8) | 799 | 1,002 | 1,111 | |||||||||
Total vessel operating expenses | 6,796 | 7,198 | 8,202 |
(1) | Average number of vessels is the number of vessels that constituted BET’s fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of BET’s fleet during the relevant period divided by the number of calendar days in the relevant period. | |
(2) | Ownership days are the total number of days in a period during which the vessels in a fleet have been owned. Ownership days are an indicator of the size of BET’s fleet over a period and affect both the amount of revenues and the amount of expenses that BET recorded during a period. | |
(3) | Available days are the number of ownership days less the aggregate number of days that vessels areoff-hire due to major repairs, dry-dockings or special or intermediate surveys. The shipping industry uses available days to measure the number of ownership days in a period during which vessels should be capable of generating revenues. |
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(4) | Operating days are the number of available days in a period less the aggregate number of days that vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues. | |
(5) | Fleet utilization is the percentage of time that BET’s vessels were generating revenue, and is determined by dividing operating days by ownership days for the relevant period. | |
(6) | Time charter equivalent, or TCE, rates are defined as the time charter revenues less voyage expenses during a period divided by the number of our operating days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. | |
The following table is unaudited and includes information that is extracted directly from the financial statements, as well as other information used by BET for monitoring performance. |
Six Months | ||||||||||||
Ended | Twelve Months Ended | |||||||||||
June 30, | December 31, | |||||||||||
2009 | 2008 | 2007 | ||||||||||
(Dollars in thousands except per diem amounts) | ||||||||||||
Vessel revenues | 17,481 | 61,027 | 5,362 | |||||||||
Voyage expenses | 2,524 | 1,981 | 22 | |||||||||
Net operating revenues | 14,957 | 59,046 | 5,340 | |||||||||
Operating days | 892 | 1,811 | 392 | |||||||||
Average TCE daily rate | 16,768 | 32,604 | 13,622 |
(7) | Average daily vessel operating expenses, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs, are calculated by dividing vessel operating expenses by ownership days for the relevant time periods: |
Six Months | ||||||||||||
Ended | Twelve Months Ended | |||||||||||
June 30, | December 31, | |||||||||||
2009 | 2008 | 2007 | ||||||||||
(Dollars in thousands except per diem amounts) | ||||||||||||
Vessel operating expenses | 5,427 | 12,001 | 2,815 | |||||||||
Ownership days | 905 | 1,937 | 397 | |||||||||
Daily vessel operating expense | 5,997 | 6,196 | 7,091 |
(8) | Daily management fees are calculated by dividing total management fees by ownership days for the relevant time period. |
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• | Not to permit any lien to be created over all or any part of the borrowers’ present or future undertakings, assets, rights or revenues to secure any present or future indebtedness; | |
• | Not to merge or consolidate with any other person; | |
• | Not to sell, transfer, dispose of or exercise direct control over any part of the borrowers’ assets, rights or revenue without the consent of the lender; | |
• | Not to undertake any business other than the ownership and operation of vessels and the chartering of vessels to third parties; | |
• | Not to acquire any assets other than the BET vessels; | |
• | Not to incur any obligations except under the loan agreement and related documents or contracts entered into in the ordinary course of business; | |
• | Not to borrow money other than pursuant to the loan agreement, except that the borrowers may borrow money from their shareholders or directors or their related companies as long as such borrowings are subordinate to amounts due under the loan agreement; | |
• | Not to guarantee, indemnify or become contingently liable for the obligations of another person or entity except pursuant to the loan agreement and related documents, except, in general, for certain guarantees that arise in the ordinary course of business; |
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• | Not to make any loans or grant any credit to any person, except that the borrowers make loans to BET or the borrowers’ related companies as long as they are made on an arm’s length basis in the ordinary course of business and are fully subordinated to the rights of the lender; | |
• | Not to redeem their own shares of stock; | |
• | Not to permit any change in the legal or beneficial ownership of any of the borrowers or BET or cause any change in the shareholders’ agreement or constitutional documents related to BET; and | |
• | Not to enter into any related party transactions except on an arm’s length basis and for full value. |
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Payments Due by Period | ||||||||||||||||||||
Less | More | |||||||||||||||||||
Than 1 | 1-2 | 2-5 | Than 5 | |||||||||||||||||
June 30, 2009 | Total | Year | Years | Years | Years | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Long-term debt | 142,472 | 16,573 | 33,145 | 49,718 | 43,036 | |||||||||||||||
Interest on long-term debt | 13,058 | 1,737 | 5,326 | 5,995 | — | |||||||||||||||
Management fees | 8,518 | 1,350 | 2,785 | 4,383 | — | |||||||||||||||
Total obligations | 164,048 | 19,660 | 41,256 | 60,096 | 43,036 | |||||||||||||||
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Page | ||||
99 | ||||
Unaudited Pro Forma Condensed Consolidated Statement of Operations of Seanergy Maritime Holdings Corp. and BET for the Nine Months Ended September 30, 2009 | 101 | |||
Unaudited Conversion of BET Consolidated Statement of Operations from IFRS to US GAAP for the Six Months ended June 30, 2009 | 103 | |||
Unaudited Conversion of BET Consolidated Statement of Operations from IFRS to US GAAP for the Year Ended December 31, 2008 | 104 | |||
106 | ||||
108 |
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Seanergy | ||||||||||||||||||||
Maritime | ||||||||||||||||||||
After Giving | ||||||||||||||||||||
Pro Forma | ||||||||||||||||||||
Effect to the | ||||||||||||||||||||
Acquisition | Pro Forma | |||||||||||||||||||
of the Restis | Including | |||||||||||||||||||
Family | Bulk | Fair Value | ||||||||||||||||||
Affiliated | Energy | Adjustments | Total | |||||||||||||||||
Vessels(1) | Transport(2) | Debit | Credit | Pro Forma | ||||||||||||||||
Revenues: | ||||||||||||||||||||
Vessel revenue — related party | 77,574 | 168 | 77,742 | |||||||||||||||||
Revenue from vessels | 60,859 | 60,859 | ||||||||||||||||||
Commissions — related party | (880 | ) | — | (880 | ) | |||||||||||||||
Vessel revenue — related party, net | 76,694 | 61,027 | 137,721 | |||||||||||||||||
Expenses: | ||||||||||||||||||||
Direct voyage expenses | (954 | ) | (1,981 | ) | (2,935 | ) | ||||||||||||||
Vessel operating expenses | (9,160 | ) | (12,001 | ) | (21,161 | ) | ||||||||||||||
Voyage expenses — related party | (440 | ) | (440 | ) | ||||||||||||||||
Management fees — related party | (973 | ) | (1,941 | ) | (2,914 | ) | ||||||||||||||
General and administration expenses | (1,840 | ) | (1,840 | ) | ||||||||||||||||
General and administration expenses — related party | (1,012 | ) | (1,012 | ) | ||||||||||||||||
Depreciation | (29,427 | ) | (23,119 | ) | 14,366 | (3) | (38,180 | ) | ||||||||||||
Amortization of deferred dry-docking costs | (605 | ) | (1,843 | ) | (2,448 | ) | ||||||||||||||
Goodwill impairment loss | (44,795 | ) | (44,795 | ) | ||||||||||||||||
Vessels’ impairment loss | — | |||||||||||||||||||
Operating Income (Loss) | (12,512 | ) | 20,142 | 21,996 | ||||||||||||||||
Gain on sale of vessels | 57,222 | 57,222 | ||||||||||||||||||
Other Expenses: | ||||||||||||||||||||
Interest and finance costs | (7,121 | ) | (16,094 | ) | (23,215 | ) | ||||||||||||||
Interest and finance costs — shareholders | (838 | ) | (838 | ) | ||||||||||||||||
Interest income — money market funds | 36 | 1,098 | 1,134 | |||||||||||||||||
Foreign currency exchange gains (losses), net | (39 | ) | (39 | ) | ||||||||||||||||
Other Income (Expense) | (7,962 | ) | (14,996 | ) | (22,958 | ) | ||||||||||||||
Net Income (Loss) | (20,474 | ) | 62,368 | 14,366 | 56,260 | |||||||||||||||
Noncontrolling interest | (31,184 | )(4) | (7,183 | ) | (38,367 | ) | ||||||||||||||
Net Income/(Loss) attributable to Seanergy | (20,474 | ) | 31,184 | 7,183 | 17,893 | |||||||||||||||
Net Income (Loss) per common share | ||||||||||||||||||||
Basic | (0.77 | ) | 0.68 | |||||||||||||||||
Diluted | (0.77 | ) | 0.48 | |||||||||||||||||
Weighted average common shares outstanding (5) | ||||||||||||||||||||
Basic | 26,452,291 | 26,452,291 | ||||||||||||||||||
Diluted | 26,452,291 | 37,252,037 | ||||||||||||||||||
(1) | Derived from the consolidated results of Seanergy Maritime and its subsidiaries after giving pro forma effect to the acquisition of the Restis family affiliated vessels included elsewhere in this prospectus. |
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(2) | As reported under US GAAP. A controlling interest in BET was acquired by Seanergy. BET’s fleet consists of four Capesize vessels and one Panamax vessel. |
(3) | To adjust depreciation expense based on the fair value of the vessels as of the date of acquisition. |
(4) | To reflect noncontrolling interest of 50% ownership in BET. |
(5) | The calculation of net income (loss) per common share is summarized below. |
2008 | ||||
Basic: | ||||
Net (loss) income | $ | 17,893 | ||
Weighted average of common shares outstanding — basic | 26,452,291 | |||
Net income (loss) per common share-basic | $ | 0.68 | ||
Diluted: | ||||
Net (loss) income | $ | 17,893 | ||
Weighted average of common shares outstanding — basic | 26,452,291 | |||
Effect of dilutive common stock equivalents | 10,799,746 | |||
Pro forma number of common shares outstanding — diluted | 37,252,037 | |||
Net income (loss) per common share-diluted | $ | 0.48 | ||
Underwriters purchase options — common shares | 1,000,000 | |||
Underwriters purchase options — warrants | 1,000,000 | |||
Convertible note — to related party | 2,260,000 | |||
Contingently-issuable shares — earn-out | 4,308,075 | |||
Total | 8,568,075 | |||
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Bulk | ||||||||||||||||||||
Seanergy | Energy | Pro Forma Including Fair Value Adjustments | Total Pro | |||||||||||||||||
Maritime(1) | Transport(2) | Debit | Credit | Forma | ||||||||||||||||
Revenues: | ||||||||||||||||||||
Vessel revenue — related party | 70,651 | 17,481 | 4,720 | (3) | 92,852 | |||||||||||||||
Revenue from vessels | 1,887 | 1,887 | ||||||||||||||||||
Commissions — related party | (1,856 | ) | (1,856 | ) | ||||||||||||||||
Commissions | (20 | ) | — | — | — | (20 | ) | |||||||||||||
Vessel revenue — related party, net | 70,662 | 17,481 | — | 4,720 | 92,863 | |||||||||||||||
Expenses: | ||||||||||||||||||||
Direct voyage expenses | (480 | ) | (2,524 | ) | 639 | (3) | (3,643 | ) | ||||||||||||
Vessel operating expenses | (9,756 | ) | (5,592 | ) | 1,195 | (3) | (16,543 | ) | ||||||||||||
Voyage expenses — related party | (841 | ) | (841 | ) | ||||||||||||||||
Management fees — related party | (1,078 | ) | (723 | ) | 168 | (3) | (1,969 | ) | ||||||||||||
General and administration expenses | (3,083 | ) | (3,083 | ) | ||||||||||||||||
General and administration expenses — related party | (1,553 | ) | (1,553 | ) | ||||||||||||||||
Depreciation | (20,716 | ) | (10,550 | ) | 763 | (3) | 5,560 | (4) | (26,469 | ) | ||||||||||
Amortization of deferred dry-docking costs | (397 | ) | (1,180 | ) | 1,180 | (5) | (397 | ) | ||||||||||||
Gain from acquisition | 6,813 | — | — | — | 6,813 | |||||||||||||||
Operating Income (Loss) | 39,571 | (3,088 | ) | 2,765 | 11,460 | 45,178 | ||||||||||||||
Other Expenses: | ||||||||||||||||||||
Interest and finance costs | (6,270 | ) | (1,953 | ) | 1,519 | (6) | (9,742 | ) | ||||||||||||
Interest and finance costs — shareholders | (386 | ) | (386 | ) | ||||||||||||||||
Interest income — money market funds | 363 | 2,358 | 212 | (3) | 2,933 | |||||||||||||||
Foreign currency exchange gains (losses), net | (80 | ) | 7 | (3) | (73 | ) | ||||||||||||||
Other Income (Expense) | (6,373 | ) | 405 | 1,519 | 219 | (7,268 | ) | |||||||||||||
Net income (loss) | 33,198 | (2,683 | ) | 4,284 | 11,679 | 37,910 | ||||||||||||||
Less: Net (Loss) Attributable to the Noncontrolling interest | 67 | — | 2,356 | (7) | — | 2,289 | ||||||||||||||
Net Income attributable to Seanergy Maritime Holdings | 33,265 | 35,621 | ||||||||||||||||||
Net Income per common share | ||||||||||||||||||||
Basic | 1.44 | 1.54 | ||||||||||||||||||
Diluted | 1.13 | 1.22 | ||||||||||||||||||
Weighted average common shares outstanding (Note 8) | ||||||||||||||||||||
Basic | 23,109,073 | 23,109,073 | ||||||||||||||||||
Diluted | 29,420,518 | 29,420,518 | ||||||||||||||||||
(1) | Derived from the consolidated statement of operations of Seanergy Maritime Holdings Corp. and subsidiaries for the nine months ended September 30, 2009. |
(2) | As reported under US GAAP for the six months ended June 30, 2009. |
(3) | Represents the additional revenue, operating and other expenses for the BET Vessels operating from July 1, 2009 to August 12, 2009. |
(4) | To adjust depreciation expense from January 1, 2009 to June 30, 2009 based on the fair value of the vessels as of the date of acquisition. |
(5) | To eliminate amortization of dry-docking costs. |
(6) | To adjust interest and finance costs, as if the increased margin was effective from January 1, 2009. |
(7) | To reflect noncontrolling interest of 50% ownership in BET. |
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Nine Months Ended | ||||
September 30, 2009 | ||||
Basic: | ||||
Net (loss) income | $ | 35,621 | ||
Weighted average of common shares outstanding — basic | 23,109,073 | |||
Net income (loss) per common share-basic | $ | 1.54 | ||
Diluted: | ||||
Net (loss) income | $ | 36,007 | ||
Weighted average common shares outstanding | 23,109,073 | |||
Effect of dilutive common stock equivalents | 6,311,445 | |||
Pro forma weighted average number of common shares outstanding — diluted | 29,420,518 | |||
Net income (loss) per common share-diluted | $ | 1.22 | ||
Contingently-issuable shares — earn-out | 4,308,075 | |||
Total | 4,308,075 | |||
Private warrants | 16,016,667 | |||
Public warrants | 22,968,000 | |||
Underwriters purchase options - common shares | 1,000,000 | |||
Underwriters purchase options - warrants | 1,000,000 | |||
Total | 40,984,667 | |||
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Unaudited Condensed Consolidated Statement of Operations
Conversion From IFRS to US GAAP
For the Six Months ended June 30, 2009
As | Adjustments to Convert | As Presented | ||||||||||||||
Reported | IFRS to US GAAP | under US | ||||||||||||||
under IFRS | Debit | Credit | GAAP | |||||||||||||
(In thousands of U.S. dollars) | ||||||||||||||||
Revenue from vessels | 17,481 | 17,481 | ||||||||||||||
Direct voyage expenses | 2,524 | 2,524 | ||||||||||||||
14,957 | 14,957 | |||||||||||||||
Operating expenses | ||||||||||||||||
Crew costs | 2,346 | 2,346 | ||||||||||||||
Management fees — related party | 723 | 723 | ||||||||||||||
Other operating expenses | 3,081 | 165 | (A1) | 3,246 | ||||||||||||
Impairment loss | 64,604 | 64,439 | (A4) | — | ||||||||||||
165 | (A1) | |||||||||||||||
Depreciation expense | 14,484 | 1,180 | (A2) | 10,550 | ||||||||||||
2,754 | (A3) | |||||||||||||||
Amortization of dry docking | — | 1,180 | (A2) | 1,180 | ||||||||||||
Total operating expenses | 85,238 | 1,345 | 68,538 | 18,045 | ||||||||||||
Operating income/(loss) | (70,281 | ) | (1,345 | ) | 68,538 | (3,088 | ) | |||||||||
Other income (expense) | ||||||||||||||||
Interest income | 2,358 | 2,358 | ||||||||||||||
Interest expense | (1,953 | ) | (1,953 | ) | ||||||||||||
Total other income (expense) | 405 | 405 | ||||||||||||||
Net (loss) | (69,876 | ) | (1,345 | ) | 68,538 | (2,683 | ) | |||||||||
(A1) | To reclassify the impairment loss from charters to other operating expenses. |
(A2) | To reclassify the amortization of dry docking expenses that are considered a component of depreciation under IFRS. |
(A3) | To eliminate depreciation expense relating to the revaluation of the vessels to their fair value under IFRS. |
(A4) | Reversal of impairment loss recorded for vessels in accordance with IFRS. |
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Unaudited Condensed Consolidated Statement of Operations
Conversion From IFRS to US GAAP
For the year ended December 31, 2008
As | Adjustments to Convert | As Presented | ||||||||||||||
Reported | IFRS to US GAAP | Under US | ||||||||||||||
Under IFRS | Debit | Credit | GAAP | |||||||||||||
(In thousands of U.S. dollars) | ||||||||||||||||
Revenue from vessels | 60,859 | 60,859 | ||||||||||||||
Revenue from vessels — related party | 168 | 168 | ||||||||||||||
61,027 | 61,027 | |||||||||||||||
Direct voyage expenses | 1,981 | 1,981 | ||||||||||||||
59,046 | 59,046 | |||||||||||||||
Gain on sale of vessels | 59,068 | 1,846 | (A3) | 57,222 | ||||||||||||
Operating expenses | ||||||||||||||||
Crew costs | 5,213 | 5,213 | ||||||||||||||
Management fees — related party | 1,941 | 1,941 | ||||||||||||||
Other operating expenses | 6,788 | 6,788 | ||||||||||||||
Impairment loss | 2,649 | 2,649 | (A4) | — | ||||||||||||
Depreciation expense | 41,824 | 1,843 | (A1) | 23,119 | ||||||||||||
15,016 | (A2) | |||||||||||||||
1,846 | (A3) | |||||||||||||||
Amortization of dry-docking | — | 1,843 | (A1) | 1,843 | ||||||||||||
Total operating expenses | 58,415 | 1,843 | 21,354 | 38,904 | ||||||||||||
Operating income | 59,699 | 77,364 | ||||||||||||||
Other income (expense) | ||||||||||||||||
Interest income | 1,098 | 1,098 | ||||||||||||||
Interest expense | (16,094 | ) | (16,094 | ) | ||||||||||||
Total other income (expense) | (14,996 | ) | (14,996 | ) | ||||||||||||
Net income | 44,703 | 3,689 | 21,354 | 62,368 | ||||||||||||
(A1) | To reclassify the amortization of dry docking expenses that are considered a component of depreciation under IFRS. | |
(A2) | To eliminate depreciation expense relating to the revaluation of the vessels to their fair value under IFRS. | |
(A3) | To eliminate depreciation expense relating to the revaluation of the sold vessel recorded under IFRS. |
(A4) | Reversal of impairment loss recorded for vessels in accordance with IFRS. |
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RESTIS FAMILY AFFILIATED
VESSELS ACQUIRED
UNAUDITED PRO FORMA SUMMARY FINANCIAL DATA
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Year Ended December 31, 2008
Restis Family | ||||||||||||||||||||||||
Affiliates | ||||||||||||||||||||||||
Initial Fleet | ||||||||||||||||||||||||
Seanergy Maritime | Acquired From | Pro Forma Adjustments and | ||||||||||||||||||||||
Holdings Corp. and | Affiliates | Eliminations | Total | |||||||||||||||||||||
Subsidiaries (Note A) | (Note B) | Debit | Credit | Pro Forma | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Vessel revenue — related party | 35,333 | 28,227 | 14,014 | (1) | 77,574 | |||||||||||||||||||
Commissions — related party | (880 | ) | — | (880 | ) | |||||||||||||||||||
Vessel revenue — related party, net | 34,453 | 28,227 | 76.694 | |||||||||||||||||||||
Expenses: | ||||||||||||||||||||||||
Direct voyage expenses | (151 | ) | (759 | ) | (44 | )(1) | (954 | ) | ||||||||||||||||
Vessel operating expenses | (3,180 | ) | (3,974 | ) | (2,006 | )(1) | (9,160 | ) | ||||||||||||||||
Voyage expenses — related party | (440 | ) | — | (440 | ) | |||||||||||||||||||
Management fees — related party | (388 | ) | (411 | ) | (159 | )(1) | (973 | ) | ||||||||||||||||
(15 | )(10) | |||||||||||||||||||||||
General and administration expenses | (1,840 | ) | — | (1,840 | ) | |||||||||||||||||||
General and administration expenses — related party | (430 | ) | — | (582 | )(11) | (1,012 | ) | |||||||||||||||||
Depreciation | (9,929 | ) | (4,779 | ) | (14,719 | )(9) | (29,427 | ) | ||||||||||||||||
Amortization of dry-docking | — | (605 | ) | (605 | ) | |||||||||||||||||||
Goodwill impairment loss | (44,795 | ) | — | (44,795 | ) | |||||||||||||||||||
Vessels’ impairment loss | (4,530 | ) | — | 4,530 | (12) | — | ||||||||||||||||||
Operating income (loss) | (31,230 | ) | 17,699 | (12,512 | ) | |||||||||||||||||||
Other expenses, net: | ||||||||||||||||||||||||
Interest and finance costs | (3,895 | ) | (1,014 | ) | (243 | )(2) | 1,014 | (7) | (7,121 | ) | ||||||||||||||
(1,814 | )(3) | |||||||||||||||||||||||
(1,110 | )(4) | |||||||||||||||||||||||
(59 | )(8) | |||||||||||||||||||||||
Interest and finance costs — shareholders | (182 | ) | — | (656 | )(5) | (838 | ) | |||||||||||||||||
Interest income — money market funds | 3,361 | 36 | (3,361 | )(6) | 36 | |||||||||||||||||||
Foreign currency exchange gains (losses), net | (39 | ) | — | (39 | ) | |||||||||||||||||||
(755 | ) | (978 | ) | (7,962 | ) | |||||||||||||||||||
Net (loss) income | (31,985 | ) | 16,721 | (20,474 | ) | |||||||||||||||||||
(1) | Represents the additional revenue and direct vessel operating expenses for the vessels operating from July 1, 2008 to August 28, 2008. | |
(2) | To record amortization of deferred loan facility arrangement and underwriting fees based on provisions of the facility agreements ($2,550 / 84 mo X 8 mo). | |
(3) | To record interest expense on the 7 year Marfin term loan facility as if it had been in place from the beginning of the period presented. Pursuant to the term loan facility, interest is calculated based upon the 3 month LIBOR rate, plus an applicable margin, as defined in the agreement. For calculation purposes, the LIBOR rate at March 27, 2009 of 1.23% per annum, plus a margin of 1.75% was utilized. For each |
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1/8 percentage point change in the annual interest rate charged, the resulting interest expense would change by $256 during the twelve month period. | ||
(4) | To record interest expense on the 7 year Marfin revolving facility as if it had been in place from the beginning of the period presented. Pursuant to the revolving facility, interest is calculated based upon the 3 month LIBOR rate, plus an applicable margin of 2.25%, as defined in the agreement. For calculation purposes, the LIBOR rate at March 27, 2009 of 1.23% per annum was utilized. For each 1/8 percentage point change in the annual interest rate charged, the resulting interest expense would change by $192 during the twelve month period. | |
(5) | To record interest expense on the unsecured convertible note payable to Restis family as if it had been in place from the beginning of the period presented. Interest at 2.9% per annum is due at maturity, in two years. Additionally, an arrangement fee of $288 is due at maturity and note prepayment is not permitted. ($28,250 X 2.9% / 12 mo X 8 mo + $288 / 21 mo X 8 mo = $656) | |
(6) | To eliminate interest income earned on funds held in trust. | |
(7) | To eliminate, effective January 1, 2008, interest expense on indebtedness of the Restis family affiliates to be acquired that was repaid pursuant to the agreements. |
(8) | To record commitment fee on 7 year revolving facility at 0.25% per annum, payable quarterly in arrears, on the un-drawn revolving facility amount. These pro formas are based upon the assumption that operations are sufficient to fund working capital and dividend payment needs and any drawdown on the revolving facility will be for the purpose of funding the redemption of common stock. ($90,000 — $54,845) X 0.25% / 12 mo X 8 mo = $59. |
(9) | To record additional depreciation expense with respect to the four vessels in operation from January 1, 2008, as a result of thestep-up in basis related to the purchase of the vessels. One newly built vessel was put into operation on May 20, 2008 and one newly built vessel put into operation on August 28, 2008 and therefore depreciation has been recorded from the delivery date until August 28, 2008. |
(10) | To record increase in management fees per the management agreement dated May 20, 2008 of Euro 416 (US$549 at March 27, 2009) per day for the first year of the agreement. (New daily fee of $549 less former daily fee of $535, times 241 days, times 4 vessels, plus new daily fee of $549 less former daily fee of $535, times 100 days for a vessel put into operation on May 20, 2008). The sixth vessel was placed into operation on August 28, 2008. |
(11) | Rental expense for the period January 1, 2008 to November 16, 2008. | |
(12) | Vessel impairment would not arise after giving effect to Note (9) above, as the fair market value of the impaired vessel would be greater than its carrying value. |
(A) | Derived from the consolidated statement of operations of Seanergy Maritime Holdings Corp. and subsidiaries for the year ended December 31, 2008. | |
(B) | Six vessels owned by the following Restis Family Affiliates were acquired by Seanergy: Goldie Navigation Ltd., Pavey Services Ltd., Shoreline Universal Ltd., Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A. Two of the six vessels are newly-built, delivered and put into service in May and August 2008, respectively. |
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Conversion From IFRS to US GAAP
Six Months Ended June 30, 2008
As | Adjustments to Convert | As Presented | ||||||||||||||
Reported | IFRS to US GAAP | Under US | ||||||||||||||
Under IFRS | Debit | Credit | GAAP | |||||||||||||
(In thousands of U.S. dollars) | ||||||||||||||||
Revenue from vessels | 28,227 | 28,227 | ||||||||||||||
Direct voyage expenses | (759 | ) | (759 | ) | ||||||||||||
27,468 | 27,468 | |||||||||||||||
Operating expenses | ||||||||||||||||
Crew costs | 2,143 | 2,143 | ||||||||||||||
Management fees — related party | 411 | 411 | ||||||||||||||
Other operating expenses | 1,831 | 1,831 | ||||||||||||||
Depreciation expense | 16,314 | 605 | (1) | 4,779 | ||||||||||||
10,930 | (2) | |||||||||||||||
Amortization of dry-docking | — | 605 | (1) | 605 | ||||||||||||
Total operating expenses | 20,699 | 9,769 | ||||||||||||||
Operating income | 6,769 | 17,699 | ||||||||||||||
Other income (expense) | ||||||||||||||||
Interest income | 36 | 36 | ||||||||||||||
Interest expense | (1,014 | ) | (1,014 | ) | ||||||||||||
Total other income (expense) | (978 | ) | (978 | ) | ||||||||||||
Net income | 5,791 | 16,721 | ||||||||||||||
(1) | To reclassify the amortization of dry docking expenses that are considered a component of depreciation under IFRS. | |
(2) | To eliminate depreciation expense relating to the revaluation of the vessels to their fair value under IFRS. |
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World Seaborne Trade | ||||||||||||||||||||||||||||
% Change | CAGR | CAGR | ||||||||||||||||||||||||||
Million Tonnes | 1998 | 2003 | 2008(e) | 2009(f) | 2008-2009 | 2003-2008 | 1998-2008 | |||||||||||||||||||||
Crude Oil | 1,585 | 1,770 | 1,964 | 1,920 | (2.3 | )% | 2.1 | % | 2.2 | % | ||||||||||||||||||
Oil Products | 503 | 607 | 799 | 776 | (2.8 | )% | 5.6 | % | 4.7 | % | ||||||||||||||||||
Major Dry Bulk | 1,186 | 1,487 | 2,077 | 2,052 | (1.2 | )% | 6.9 | % | 5.8 | % | ||||||||||||||||||
Minor Dry Bulk | 719 | 815 | 988 | 935 | (5.3 | )% | 3.9 | % | 3.2 | % | ||||||||||||||||||
Container | 503 | 805 | 1,318 | 1,198 | (9.1 | )% | 10.4 | % | 10.1 | % | ||||||||||||||||||
LPG & LNG | 120 | 161 | 215 | 231 | 7.4 | % | 5.9 | % | 6.0 | % | ||||||||||||||||||
Other | 815 | 925 | 795 | 767 | (3.5 | )% | (3.0 | )% | (0.2 | )% | ||||||||||||||||||
Total | 5,430 | 6,571 | 8,157 | 7,880 | (3.4 | )% | 4.4 | % | 4.2 | % | ||||||||||||||||||
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Global Seaborne Dry Bulk Imports | ||||||||||||||||||||||||||||
Million Tonnes | 1990 | 1995 | 2000 | 2005 | 2008(e) | 2009(f) | CAGR (1990-2009) | |||||||||||||||||||||
Iron Ore | 347 | 402 | 447 | 658 | 843 | 847 | 4.8 | % | ||||||||||||||||||||
Asia Pacific | 180 | 218 | 265 | 475 | 653 | 726 | 7.6 | % | ||||||||||||||||||||
Western Europe | 135 | 136 | 129 | 122 | 121 | 70 | (3.4 | )% | ||||||||||||||||||||
Rest of World | 32 | 48 | 53 | 61 | 69 | 51 | 2.4 | % | ||||||||||||||||||||
Coal | 329 | 399 | 516 | 688 | 795 | 777 | 4.6 | % | ||||||||||||||||||||
Asia Pacific | 164 | 221 | 299 | 409 | 509 | 516 | 6.2 | % | ||||||||||||||||||||
Western Europe | 132 | 133 | 152 | 183 | 186 | 170 | 1.3 | % | ||||||||||||||||||||
Rest of World | 33 | 45 | 65 | 95 | 101 | 91 | 5.4 | % | ||||||||||||||||||||
Grain | 197 | 182 | 212 | 212 | 239 | 248 | 1.2 | % | ||||||||||||||||||||
Asia Pacific | 67 | 79 | 69 | 73 | 68 | 68 | 0.1 | % | ||||||||||||||||||||
Western Europe | 6 | 6 | 7 | 11 | 28 | 12 | 3.7 | % | ||||||||||||||||||||
Rest of World | 123 | 98 | 136 | 128 | 144 | 167 | 1.6 | % | ||||||||||||||||||||
Total | 873 | 984 | 1,175 | 1,557 | 1,877 | 1,871 | 4.1 | % | ||||||||||||||||||||
Asia Pacific | 411 | 518 | 633 | 958 | 1,230 | 1,310 | 6.3 | % | ||||||||||||||||||||
Western Europe | 273 | 275 | 288 | 315 | 334 | 253 | (0.4 | )% | ||||||||||||||||||||
Rest of World | 189 | 191 | 254 | 284 | 314 | 309 | 2.6 | % | ||||||||||||||||||||
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Major Dry Bulk Vessel Types | ||||||||||||
Class of | Cargo Capacity | Number of | ||||||||||
Bulker | (DWT) | Vessels(1) | Orderbook | Typical Use | ||||||||
Capesize | Over 100,000 | 896 | 799 | Long haul iron ore and coal transportation for use in the steel industry and power stations. | ||||||||
Panamax(2) | From 60,000 to 99,999 | 1,605 | 733 | Typically carries coal and grain as well as a number of industrial metals such as alumina/bauxite. Also involved in iron ore and minor bulk trades. | ||||||||
Handymax(3) | From 40,000 to 59,999 | 1,801 | 896 | Primarily employed to carry steel and forest products, grain, coal, cement, fertilizer, sugar and minerals. | ||||||||
Handysize | From 10,000 to 39,999 | 2,833 | 860 | Carries a variety of bulk cargo, often on short haul trades. |
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Bulk Carrier Orderbook Delivery Schedule(1) | ||||||||||||||||||||||||||||||||||||||||||||||||||
2009 | 2010 | 2011 | 2012 | 2013+ | ||||||||||||||||||||||||||||||||||||||||||||||
No. Vessels | m. DWT | No. Vessels | m. DWT | No. Vessels | m. DWT | No. Vessels | m. DWT | No. Vessels | m. DWT | |||||||||||||||||||||||||||||||||||||||||
Capesize | 110 | 20.3 | 324 | 57.7 | 219 | 40.7 | 105 | 22.3 | 41 | 8.8 | ||||||||||||||||||||||||||||||||||||||||
Panamax | 70 | 5.7 | 276 | 22.5 | 253 | 20.9 | 98 | 7.7 | 36 | 2.8 | ||||||||||||||||||||||||||||||||||||||||
Handymax | 198 | 11.0 | 362 | 20.4 | 254 | 14.4 | 75 | 4.2 | 7 | 0.4 | ||||||||||||||||||||||||||||||||||||||||
Handysize | 207 | 6.2 | 293 | 9.2 | 248 | 8.1 | 103 | 3.5 | 9 | 0.3 | ||||||||||||||||||||||||||||||||||||||||
Total | 585 | 43.2 | 1,255 | 61.0 | 974 | 92.5 | 381 | 37.7 | 93 | 12.3 | ||||||||||||||||||||||||||||||||||||||||
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Bulk Carrier Orderbook Delivery Schedule as Percentage of Current Fleet(1) | ||||||||||||||||||||||||||||||||||||||||||||||||||
2009 | 2010 | 2011 | 2012 | 2013+ | ||||||||||||||||||||||||||||||||||||||||||||||
No. Vessels | % of Fleet | No. Vessels | % Fleet | No. Vessels | % of Fleet | No. Vessels | % of Fleet | No. Vessels | % of Fleet | |||||||||||||||||||||||||||||||||||||||||
Capesize | 110 | 12.3 | % | 324 | 36.2 | % | 219 | 24.4 | % | 105 | 11.7 | % | 41 | 4.6 | % | |||||||||||||||||||||||||||||||||||
Panamax | 70 | 4.4 | % | 276 | 17.2 | % | 253 | 15.8 | % | 98 | 6.1 | % | 36 | 2.2 | % | |||||||||||||||||||||||||||||||||||
Handymax | 198 | 11.0 | % | 362 | 20.1 | % | 254 | 14.1 | % | 75 | 4.2 | % | 7 | 0.4 | % | |||||||||||||||||||||||||||||||||||
Handysize | 207 | 7.3 | % | 293 | 10.3 | % | 248 | 8.8 | % | 103 | 3.6 | % | 9 | 0.3 | % | |||||||||||||||||||||||||||||||||||
Total | 585 | 8.6 | % | 1,255 | 18.5 | % | 974 | 14.4 | % | 381 | 5.6 | % | 93 | 1.4 | % | |||||||||||||||||||||||||||||||||||
Age and Size of the World Dry Bulk Carrier Fleet(1) | ||||||||||||||||||||||||||||||||||||||
Orderbook | ||||||||||||||||||||||||||||||||||||||
Cargo Capacity | Average | % 20 | % of | |||||||||||||||||||||||||||||||||||
(DWT) | No. Vessels | m. DWT | Age (Years) | Years + | No. Vessels | m. DWT | Fleet(2) | |||||||||||||||||||||||||||||||
Capesize | Over 100,000 | 896 | 158.2 | 11.5 | 16 | % | 799 | 149.7 | 95 | % | ||||||||||||||||||||||||||||
Panamax | From 60,000 to 99,999 | 1,601 | 118.6 | 12.2 | 23 | % | 733 | 59.7 | 50 | % | ||||||||||||||||||||||||||||
Handymax | From 40,000 to 59,999 | 1,801 | 88.2 | 11.8 | 23 | % | 896 | 50.4 | 57 | % | ||||||||||||||||||||||||||||
Handysize | From 10,000 to 39,999 | 2,833 | 75.7 | 19.8 | 56 | % | 860 | 27.4 | 36 | % | ||||||||||||||||||||||||||||
Total | 7,131 | 440.7 | 15.0 | 35 | % | 3,288 | 287.2 | 65 | % | |||||||||||||||||||||||||||||
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Dry Bulk Carrier Demolition | ||||||||||||||||||||||||||||||||||||||||||||||||||
Capesize | Panamax | Handymax | Handysize | Total | ||||||||||||||||||||||||||||||||||||||||||||||
No. | m. DWT | No. | m. DWT | No. | m. DWT | No. | m. DWT | No. | m. DWT | |||||||||||||||||||||||||||||||||||||||||
2002 | 11 | 1.26 | 22 | 1.45 | 10 | 4.79 | 105 | 2.17 | 148 | 9.66 | ||||||||||||||||||||||||||||||||||||||||
2003 | 10 | 0.76 | 8 | 0.60 | 12 | 5.73 | 80 | 0.26 | 110 | 7.35 | ||||||||||||||||||||||||||||||||||||||||
2004 | 6 | 0.00 | 0 | 0.00 | 1 | 0.57 | 12 | 0.42 | 19 | 0.99 | ||||||||||||||||||||||||||||||||||||||||
2005 | 0 | 0.25 | 3 | 0.20 | 2 | 0.96 | 16 | 0.85 | 21 | 2.27 | ||||||||||||||||||||||||||||||||||||||||
2006 | 2 | 0.30 | 8 | 0.54 | 2 | 0.97 | 35 | 0.21 | 47 | 2.02 | ||||||||||||||||||||||||||||||||||||||||
2007 | 2 | 0.00 | 2 | 0.14 | 1 | 0.55 | 10 | 1.62 | 15 | 2.31 | ||||||||||||||||||||||||||||||||||||||||
2008 | 13 | 1.90 | 17 | 1.11 | 8 | 3.73 | 57 | 3.56 | 95 | 10.29 | ||||||||||||||||||||||||||||||||||||||||
2009(f) | 3.60 | 3.50 | 1.40 | 7.00 | 15.50 | |||||||||||||||||||||||||||||||||||||||||||||
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Panamax Bulk Carrier Charter Rates(1) | |||||||||||||||||
74,000 DWT Time Charter ($/day) | Spot Earnings(2) | ||||||||||||||||
6-Months | 1-Year | 3-Year | ($/day) | ||||||||||||||
AVG 2003 | 20,212 | 17,254 | 12,707 | 19,304 | |||||||||||||
AVG 2004 | 37,835 | 34,323 | 22,274 | 34,364 | |||||||||||||
AVG 2005 | 27,577 | 25,853 | 19,606 | 23,110 | |||||||||||||
AVG 2006 | 24,517 | 22,155 | 17,736 | 21,714 | |||||||||||||
AVG 2007 | 58,796 | 52,317 | 39,774 | 49,350 | |||||||||||||
AVG 2008 | 57,293 | 55,637 | 44,356 | 43,323 | |||||||||||||
2008-01 | 66,125 | 63,250 | 45,000 | 51,240 | |||||||||||||
2008-02 | 68,350 | 66,100 | 48,400 | 47,570 | |||||||||||||
2008-03 | 74,938 | 71,625 | 56,000 | 58,939 | |||||||||||||
2008-04 | 75,063 | 71,000 | 54,250 | 59,894 | |||||||||||||
2008-05 | 84,400 | 76,050 | 58,300 | 72,099 | |||||||||||||
2008-06 | 83,313 | 79,250 | 62,000 | 65,691 | |||||||||||||
2008-07 | 79,500 | 75,625 | 61,375 | 62,997 | |||||||||||||
2008-08 | 67,850 | 67,500 | 56,100 | 45,729 | |||||||||||||
2008-09 | 50,000 | 50,000 | 42,250 | 32,854 | |||||||||||||
2008-10 | 18,050 | 21,350 | 19,300 | 9,100 | |||||||||||||
2008-11 | 10,000 | 13,250 | 15,500 | 8,382 | |||||||||||||
2008-12 | 7,563 | 10,531 | 12,625 | 5,083 | |||||||||||||
2009-01 | 8,100 | 11,425 | 13,200 | 3,558 | |||||||||||||
2009-02 | 14,188 | 14,938 | 16,125 | 9,474 | |||||||||||||
2009-03 | 17,188 | 15,000 | 14,875 | 11,990 | |||||||||||||
2009-04 | 14,531 | 13,188 | 13,625 | 7,259 | |||||||||||||
2009-05 | 19,250 | 16,075 | 14,600 | 13,555 | |||||||||||||
2009-06 | 27,000 | 21,188 | 15,500 | 21,137 | |||||||||||||
2009-07 | 27,450 | 21,650 | 15,450 | 20,247 | |||||||||||||
2009-08 | 23,563 | 19,000 | 15,500 | 14,611 | |||||||||||||
2009-09 | 23,438 | 19,063 | 15,750 | 15,592 | |||||||||||||
02-Oct-09 | 22,250 | 18,000 | 15,500 | 14,432 | |||||||||||||
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Estimated Bulk Carrier Newbuilding and Secondhand Prices ($ millions) | ||||||||||||||||||||||||||||
Start Year: | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | Sep-09 | |||||||||||||||||||||
176-180,000 dwt Capesize newbuilding | 48.0 | 64.0 | 59.0 | 68.0 | 97.0 | 88.0 | 58.0 | |||||||||||||||||||||
75-77,000 dwt Panamax newbuilding | 27.0 | 36.0 | 36.0 | 40.0 | 55.0 | 46.5 | 33.0 | |||||||||||||||||||||
56-58,000 dwt Handymax newbuilding | 24.0 | 30.0 | 30.5 | 36.5 | 48.0 | 42.0 | 30.0 | |||||||||||||||||||||
32-35,000 dwt Handysize newbuilding | 18.5 | 24.5 | 26.5 | 29.5 | 38.0 | 32.5 | 25.0 | |||||||||||||||||||||
170,000 dwt SH5-year old vessel | 44.0 | 64.5 | 57.0 | 81.0 | 150.0 | 45.0 | 58.0 | |||||||||||||||||||||
73,000 dwt SH5-year old vessel | 28.0 | 40.0 | 29.5 | 45.5 | 88.5 | 26.0 | 34.5 | |||||||||||||||||||||
52,000 dwt SH5-year old vessel | 20.0 | 29.0 | 25.5 | 40.0 | 75.0 | 24.5 | 28.5 | |||||||||||||||||||||
28-30,000 dwt SH5-year old vessel | 14.5 | 21.5 | 26.0 | 28.5 | 44.0 | 20.5 | 21.0 |
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Terms of Time | Daily Time | |||||||||||
Year | Charter | Charter | ||||||||||
Vessel/Flag | Type | Dwt | Built | Period | Hire Rate | Charterer | ||||||
African Oryx/Bahamas | Handysize | 24,110 | 1997 | Expiring August 2011 | $7,000 plus a 50% profit share calculated on the average spot Time Charter Routes derived from the Baltic Supramax Index | MUR Shipping B.V. | ||||||
African Zebra/Bahamas | Handymax | 38,623 | 1985 | Expiring August 2011 | $7,500 plus a 50% profit share calculated on the average spot Time Charter Routes derived from the Baltic Supramax Index | MUR Shipping B.V. | ||||||
Bremen Max/Isle of Man | Panamax | 73,503 | 1993 | Expiring August 2010 | $15,500 | SAMC | ||||||
Hamburg Max/Isle of Man | Panamax | 72,338 | 1994 | Expiring September 2010 | $15,500 | SAMC | ||||||
Davakis G./Bahamas(1)(4) | Supramax | 54,051 | 2008 | SPOT | N/A | |||||||
Delos Ranger/Bahamas(1)(4) | Supramax | 54,051 | 2008 | SPOT | N/A | |||||||
BET Commander/Isle of Man(2) | Capesize | 149,507 | 1991 | December 2009(3) | $22,000 | Swiss Marine Services SA | ||||||
BET Fighter/St. Vincent and the Grenadines(2) | Capesize | 173,149 | 1992 | Expiring in September 2011 | $25,000 | SAMC | ||||||
BET Prince/Isle of Man(2) | Capesize | 163,554 | 1995 | Expiring in November 2009(3) | $23,000 | Swiss Marine Services SA | ||||||
BET Scouter/Isle of Man(2) | Capesize | 171,175 | 1995 | Expiring in October 2011 | $26,000 | SAMC | ||||||
BET Intruder/Isle of Man(2) | Panamax | 69,235 | 1993 | Expiring in September 2011 | $15,500 | SAMC | ||||||
Total | 1,043,296 | |||||||||||
(1) | The vessels are employed in the spot market. |
(2) | Vessels owned by BET. |
(3) | We have secured new time charters with SAMC for each of the BET Commander and BET Prince commencing upon the expiration of the existing time charters at daily charter rates of $24,000 and $25,000, respectively, through February 2012 and January 2012, respectively. |
(4) | Sisterships. |
• | Capesize. Capesize vessels have a carrying capacity of 100,000-199,999 dwt. Only the largest ports around the world possess the infrastructure to accommodate vessels of this size. Capesize vessels are primarily used to transport iron ore or coal and, to a much lesser extent, grains, primarily on long-haul routes. | |
• | Panamax. Panamax vessels have a carrying capacity of between 60,000 and 100,000 dwt. These vessels are designed to meet the physical restrictions of the Panama Canal locks (hence their name “Panamax” — the largest vessels able to transit the Panama Canal, making them more versatile than larger vessels). These vessels carry coal, grains, and, to a lesser extent, minerals such asbauxite/alumina and phosphate rock. As the availability of Capesize vessels has dwindled, Panamaxes have also been used to haul iron ore cargoes. | |
• | Handymax/Supramax. Handymax vessels have a carrying capacity of between 30,000 and 60,000 dwt. These vessels operate on a large number of geographically dispersed global trade routes, carrying primarily grains and minor bulks. The standard vessels are usually built with25-30 ton cargo gear, |
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enabling them to discharge cargo where grabs are required (particularly industrial minerals), and to conduct cargo operations in countries and ports with limited infrastructure. This type of vessel offers good trading flexibility and can therefore be used in a wide variety of bulk and neobulk trades, such as steel products. Supramax are a sub-category of this category typically having a cargo carrying capacity of between 50,000 and 60,000 dwt. |
• | Handysize. Handysize vessels have a carrying capacity of up to 30,000 dwt. These vessels are almost exclusively carrying minor bulk cargo. Increasingly, vessels of this type operate on regional trading routes, and may serve as trans-shipment feeders for larger vessels. Handysize vessels are well suited for small ports with length and draft restrictions. Their cargo gear enables them to service ports lacking the infrastructure for cargo loading and unloading. |
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• | Extensive Industry Visibility. Our management and directors have extensive shipping and public company experience as well as relationships in the shipping industry and with charterers in the coal, steel and iron ore industries. We capitalize on these relationships and contacts to gain market intelligence, source sale and purchase opportunities and identify chartering opportunities with leading charterers in these core commodities industries, many of whom consider the reputation of a vessel owner and operator when entering into time charters. |
• | Established Customer Relationships. We believe that our directors and management team have established relationships with leading charterers and a number of chartering, sales and purchase brokerage houses around the world. We believe that our directors and management team have maintained relationships with, and have achieved acceptance by, major national and private industrial users, commodity producers and traders. |
• | Experienced and Dedicated Management Team. We believe that our management team, equipped with extensive shipping experience, has developed strong industry relationships with leading charterers, shipbuilders, insurance underwriters, protection and indemnity associations and financial institutions. Management has continued to take actions over the course of the past year to allow us to operate profitably in 2009 after the net loss of $32 million we recorded for our initial period of operations through December 31, 2008. This net loss resulted primarily from a one-time non-cash charge in the 2008 period of $49.3 million for goodwill and vessel impairment losses related to the downturn in the worldwide economy and the resulting deteriorating vessel market values. The measures that our management team has taken, both to minimize the ongoing impact of the worldwide recession and to improve our results of operations, include the following: |
• | We secured charter agreements for our initial fleet prior to the market decline in May 2008 with SAMC, which honored its contractual obligations, providing us with a secure cash flow throughout the terms of the charters. As a result, for the nine months ended September 30, 2009, we earned $70.7 million of net vessel revenue and net income of $33.3 million. Our cash reserves were $64 million as of September 30, 2009, which reflected the $36.4 million in cash from operations we generated during the period. |
• | In August 2009, we completed the acquisition of a 50% ownership interest in BET. We acquired a 50% interest of net assets of $13.6 million for cash consideration of $1. As a result of this transaction, we almost doubled our fleet to 11 vessels and increased the dwt of our fleet by 229%, while also positioning us in the Capesize sector. The acquisition is immediately earnings accretive, improving our margins and cash flow, based on the charters currently in place for the vessels acquired as described above under “Our Fleet.” |
• | We have also secured time charter agreements of various durations, with our longest time charter expiring on February 24, 2012. Time charters cover 76% of 2010 days and 50% of 2011 days. |
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• | We also received, during the same period, a waiver on the loan-to-value covenant from our lender. |
• | In August 2009, we negotiated the conversion of a $28.25 million convertible promissory note due to an affiliate August 2010, plus all fees and interest due on such note, in exchange for 6,585,868 shares of our common stock. With this conversion, we reduced our debt, and the resulting debt service obligations, without depleting our cash reserves. |
• | For the twelve months ended September 30, 2009, we achieved the EBITDA target agreed to in connection with our August 2008 acquisition of our initial fleet from the Restis family. Recently, the majority of our charters have been rechartered at prevailing market rates. For 2010, we expect our average daily operating expenses per vessel to be approximately $5,500, and we expect our average daily general and administrative expenses to be approximately $1,000. Our expectations regarding 2010 operating expenses and general and administrative statements are forward-looking statements. Our actual results could vary. See “Risk Factors” for information regarding factors, many of which are outside of our control, that could cause our actual expenses to differ from expectations. |
• | Highly Efficient Operations and High Quality Fleet. We believe that our directors’ and executive officers’ long experience in third-party technical management of dry bulk carriers enable us to maintain cost-efficient operations. We actively monitor and control vessel operating expenses while maintaining the high quality of our fleet through regular inspections, comprehensive planned maintenance systems and preventive maintenance programs and by retaining and training qualified crew members. We believe that our ability to maintain and increase our customer base depends largely on the quality and performance of our fleet. We believe that owning a high quality fleet reduces operating costs, improves safety and provides us with a competitive advantage in obtaining employment for our vessels. Our vessels were built and are maintained at reputable shipyards. |
• | Balanced Chartering Strategies. Nine of our vessels are under medium-term charters with terms of 11 to 13 and 22 to 26 months and provide for fixed payments in advance. We believe that these charters will provide us with high fleet utilization and stable revenues. Two of our vessels operate in the spot market. We may in the future pursue other market opportunities for our vessels to capitalize on favorable market conditions, including entering into short-term time and voyage charters, pool arrangements or bareboat charters. |
• | Broad Fleet Profile. We focus on the dry bulk sector including Capesize, Panamax, Handymax/Supramax and Handysize dry bulk carriers. Our broad fleet profile enables us to serve our customers in both major and minor bulk trades. Our vessels are able to trade worldwide in a multitude of trade routes carrying a wide range of cargoes for a number of industries. Our dry bulk carriers can carry coal and iron ore for energy and steel production as well as grain and steel products, fertilizers, minerals, forest products, ores, bauxite, alumina, cement and other cargoes. Our fleet includes sister ships. Operating sister and similar ships provides us with operational and scheduling flexibility, efficiencies in employee training and lower inventory and maintenance expenses. We believe that operating sister ships allows us to maintain lower operating costs and streamline its operations. |
• | Fleet Growth Potential. We intend to acquire additional dry bulk carriers or enter into new contracts through timely and selective acquisitions of vessels in a manner that we determine will be accretive to cash flow. We expect to fund the acquisition of the additional vessels primarily from the proceeds of this offering and any future acquisition of additional vessels using amounts borrowed under our credit facility, future borrowings under other agreements as well as with proceeds from the exercise of the Warrants, if any, or through other sources of debt and equity. However, there can be no assurance that we will be successful in obtaining future funding or that any or all of the warrants will be exercised. |
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• | on-board installation of automatic information systems to enhance vessel-to-vessel and vessel-to-shore communications; | |
• | on-board installation of ship security alert systems; | |
• | the development of vessel security plans; and | |
• | compliance with flag state security certification requirements. |
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Vessel | Next Scheduled Dry-Dock | Estimated Cost | ||||
African Oryx | October 2010 | $ | 900,000 | |||
African Zebra | February 2011 | $ | 1,000,000 | |||
Bremen Max | June 2011 | $ | 1,000,000 | |||
Hamburg Max | June 2012 | $ | 1,000,000 | |||
Davakis G. | May 2011 | $ | 500,000 | |||
Delos Ranger | August 2011 | $ | 500,000 | |||
BET Commander* | August 2011 | $ | 1,200,000 | |||
BET Fighter* | September 2010 | $ | 1,200,000 | |||
BET Prince* | May 2010 | $ | 1,200,000 | |||
BET Scouter* | April 2010 | $ | 1,200,000 | |||
BET Intruder* | March 2011 | $ | 1,000,000 |
* | Vessels owned by BET. |
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Name | Age | Position | Class | |||||||
Georgios Koutsolioutsos | 39 | Chairman of the Board of Directors | C | |||||||
Dale Ploughman | 62 | Chief Executive Officer and Director | B | |||||||
Christina Anagnostara | 38 | Chief Financial Officer and Director | B | |||||||
Ioannis Tsigkounakis | 42 | Secretary and Director | B | |||||||
Alexios Komninos | 42 | Director | B | |||||||
Kostas Koutsoubelis | 53 | Director | C | |||||||
Elias M. Culucundis | 65 | Director | A | |||||||
George Taniskidis | 47 | Director | A | |||||||
Kyriakos Dermatis | 61 | Director | C | |||||||
Alexander Papageorgiou | 35 | Director | C | |||||||
Dimitrios N. Panagiotopoulos | 47 | Director | A | |||||||
George Tsimpis | 62 | Director | B | |||||||
Dimitris Anagnostopoulos | 62 | Director | A |
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• | Each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock; | |
• | Each of our officers and directors; and | |
• | Our officers and directors as a group. |
Percentage of Outstanding | Percentage of Outstanding | |||||||||||||||||||||||
Common Stock | Common Stock | |||||||||||||||||||||||
Before | After | Before | After | |||||||||||||||||||||
Offering | Offering | Offering | Offering | |||||||||||||||||||||
and | and | and | and | |||||||||||||||||||||
Name and Address of | Concurrent | Concurrent | Investment | Concurrent | Concurrent | |||||||||||||||||||
Beneficial Owner(1) | Voting Power | Sale | Sale(2) | Power | Sale | Sale(2) | ||||||||||||||||||
Georgios Koutsolioutsos | 28,224,029 | (3)(4)(5) | 79.12 | % | 9,568,380 | (6) | 26.28 | % | ||||||||||||||||
Alexios Komninos | 22,339,246 | (3)(4) | 74.89 | % | 1,183,417 | (6) | 3.97 | % | ||||||||||||||||
Ioannis Tsigkounakis | 21,861,645 | (3)(4) | 74.49 | % | 560,817 | (6) | 1.90 | % | ||||||||||||||||
Kostas Koutsoubelis | 0 | * | 0 | * | ||||||||||||||||||||
Elias M. Culucundis | 0 | * | 0 | * | ||||||||||||||||||||
Christina Anagnostara | 0 | * | 0 | * | ||||||||||||||||||||
George Taniskidis | 0 | * | 0 | * | ||||||||||||||||||||
Kyriakos Dermatis | 0 | * | 0 | * | ||||||||||||||||||||
Alexander Papageorgiou | 0 | * | 0 | * | ||||||||||||||||||||
Dimitrios N. Panagiotopoulos | 0 | * | 0 | * | ||||||||||||||||||||
George Tsimpis | 0 | * | 0 | * | ||||||||||||||||||||
Dale Ploughman | 0 | * | 0 | * | ||||||||||||||||||||
Dimitris Anagnostopoulos | 0 | * | 0 | * | ||||||||||||||||||||
United Capital Investments Corp. | 25,866,038 | (4)(6)(8)(9)(10) | 81.41 | % | 9,416,372 | (6) | 29.64 | % | ||||||||||||||||
Atrion Shipholding S.A. | 24,581,287 | (4)(8)(9)(10) | 79.42 | % | 7,518,620 | (6) | 24.29 | % | ||||||||||||||||
Plaza Shipholding Corp. | 24,714,881 | (4)(6)(8)(9)(10) | 79.86 | % | 7,652,214 | (6) | 24.73 | % | ||||||||||||||||
Comet Shipholding Inc. | 24,581,578 | (4)(8)(9)(10) | 79.43 | % | 7,518,911 | (6) | 24.29 | % | ||||||||||||||||
Benbay Limited | 9,416,372 | (7)(10) | 29.64 | % | 9,416,372 | (6) | 29.64 | % | ||||||||||||||||
United Capital Trust, Inc. | 9,416,372 | (7)(10) | 29.64 | % | 9,416,372 | (6) | 29.64 | % | ||||||||||||||||
Aldebaran Investments LLC(11) | 3,085,257 | 10.66 | % | 3,085,257 | 10.66 | % | ||||||||||||||||||
Brian Taylor(12) | 3,475,938 | 12.00 | % | 3,475,938 | 12.00 | % | ||||||||||||||||||
Integrated Core Strategies (US) LLC(13) | 1,647,408 | 5.69 | % | 1,647,408 | 5.69 | % | ||||||||||||||||||
All directors and executive officers as a group (13 individuals) | 28,224,029 | (3)(4)(5) | 79.12 | % | 11,309,713 | 30.60 | % |
* | Less than one (1) percent | |
(1) | Unless otherwise indicated, the business address of each of the shareholders is 1-3 Patriarchou Grigoriou, 166 74 Glyfada, Athens, Greece. | |
(2) | Assumes underwriters do not exercise overallotment option. | |
(3) | Includes 6,727,000, 880,927, and 400,416 shares of our common stock for Mr. Koutsolioutsos, Mr. Komninos and Mr. Tsigkounakis, respectively, issuable upon exercise of warrants, as to which each of Mr. Koutsolioutsos, Mr. Komninos, and Mr. Tsigkounakis have sole voting power. |
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(4) | Includes an aggregate of 18,265,649 shares of our common stock owned by the Restis affiliated shareholders, United Capital Investments, Atrion, Plaza and Comet, and Seanergy Maritime’s founding shareholders, which are subject to the Voting Agreement, as amended, described above. | |
(5) | Includes 38,700 shares of our common stock, as to which Mr. Koutsolioutsos has sole voting power. | |
(6) | Includes 70,000 shares of common stock owned by Argonaut SPC, a fund managed by Oxygen Capital AEPEY, which is an entity affiliated with Victor Restis and Katia Restis. | |
(7) | None of the Restis affiliate shareholders, other shareholders who are affiliates of the Restis family, or Seanergy Maritime’s founding shareholders has shared investment power with respect to any of the shares beneficially owned, except for (i) 9,416,372 shares included for United Capital Investments Corp., United Capital Trust, Inc. and Benbay Limited as to which each of United Capital Investments, United Capital Trust and Benbay have shared investment power; and (ii) 70,000 shares included for Plaza Shipholding Corp. as to which each of United and Plaza have shared investment power. |
(8) | Each of United Capital Investments Corp., Atrion Shipholding S.A., Plaza Shipholding Corp. and Comet Shipholding Inc. is an affiliate of members of the Restis family. The address of each of United Capital Investments Corp., Atrion Shipholding S.A., Plaza Shipholding Corp., and Comet Shipholding Inc., isc/o 11 Poseidonos Avenue, 16777 Elliniko, Athens, Greece, Attn: Evan Breibart. |
(9) | Includes 2,826,584, 2,002,038, 2,002,084, and 2,002,083 shares of our common stock for United Capital Investments, Atrion, Plaza and Comet, respectively, in connection with the exercise of the warrants, as to which each of United Capital Investments, Atrion, Plaza and Comet have sole voting power. |
(10) | Following the initial acquisition of an aggregate of 2,750,000 shares of our common stock on May 20, 2009, each of United Capital Investments, Atrion, Plaza and Comet and their affiliates have continued to make additional purchases of shares of our common stock as follows: (i) during the period between June 5, 2008 and August 11, 2008, they collectively purchased an aggregate of 8,929,781 shares of our common stock in a combination of open market purchases and private block transaction for prices ranging from $9.8711 to $10.00 per share; and (ii) during the period between October 13, 2008 and August 21, 2009, they collectively purchased an aggregate of 4,937,634 shares of our common stock in open market purchases for prices ranging from $4.78 to $6.99 per share. |
(11) | Based on Schedule 13G filed on February 17, 2009. Includes shares issuable upon exercise of warrants which became exercisable on September 24, 2008. The address is 500 Park Avenue, 5th Floor, New York, NY 10022. |
(12) | Based on Schedule 13G/A filed on January 20, 2009. Mr. Brian Taylor, who is the sole member of Pine River Capital Management LLC, the general partner of Pine River Capital Management, L.P. and director of Nisswa Acquisition Master Fund Ltd., and Pine River Capital Management L.P., Nisswa Acquisition Master Fund’s investment manager, initially had shared voting power and shared investment power for 3,475,938 shares. Nisswa Acquisition Master Fund Ltd. has shared voting power and shared investment power for 3,261,326 shares. The address of each of Mr. Taylor, Pine River Capital Management L.P. and Nisswa Acquisition Master Fund Ltd. isc/o Pine River Capital Management L.P., 601 Carlson Parkway, Suite 330, Minnetonka, MN 55305. |
(13) | Based on Schedule 13G filed on February 5, 2008. Includes shares issuable upon exercise of Warrants which became exercisable on September 24, 2008. Integrated Core Strategies (US) LLC, Millennium Management LLC and Israel A. Englander have shared voting power and shared investment power for these 1,647,408 shares. The address isc/o Millennium Management LLC, 666 Fifth Avenue, New York, NY 10103. |
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Days After the Date | Number of Shares | |||
of this Prospectus | Eligible for Sales | Comment | ||
Date of prospectus | Shares not locked up and eligible for sale freely or under Rule 144 | |||
90 days | lock-up released |
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• | in whole and not in part; |
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• | at a price of $0.01 per warrant at any time; | |
• | upon not less than 30 days’ prior written notice of redemption to each warrant holder; and | |
• | if, and only if, the reported last sale price of the Common Shares equals or exceeds $14.25 per share, for any 20 trading days within a 30 trading day period ending on the third business day prior to the notice of redemption to warrant holders; provided that a current registration statement under the Securities Act relating to the shares issuable upon exercise of the warrant, or Warrant Share, is effective. |
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Marshall Islands | Delaware | |
Shareholders’ Meetings | ||
• Held at a time and place as designated in the by-laws | • May be held at such time or place as designated in the certificate of incorporation or the bylaws, or if not so designated, as determined by the board of directors | |
• May be held within or outside the Marshall Islands | • May be held within or outside Delaware | |
• Notice: | • Notice: | |
• Whenever shareholders are required to take action at a meeting, written notice shall state the place, date and hour of the meeting and, unless it is the annual meeting, indicate that it is being issued by or at the direction of the person or persons calling the meeting. Notice of a special meeting shall also state the purpose for which the meeting is called. | • Whenever shareholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, if any, date and hour of the meeting, and the means of remote communication, if any | |
• A copy of the notice of any meeting shall be given personally or sent by mail not less than 15 nor more than 60 days before the meeting | • Written notice shall be given not less than 10 nor more than 60 days before the date of the meeting | |
Shareholders’ Voting Rights | ||
• Any action required to be taken by meeting of shareholders may be taken without meeting if consent is in writing and is signed by all the shareholders entitled to vote | • Stockholders may act by written consent to elect directors | |
• Any person authorized to vote may authorize another person to act for him by proxy | • Any person authorized to vote may authorize another person or persons to act for him by proxy | |
• Unless otherwise provided in the articles of incorporation, a majority of shares entitled to vote constitutes a quorum. In no event shall a quorum consist of fewer than one third of the shares entitled to vote at a meeting. Once a quorum is present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders | • For non-stock corporations, certificate of incorporation or bylaws may specify the number of members necessary to constitute a quorum. In the absence of this, one-third of the members shall constitute a quorum | |
• The articles of incorporation may provide for cumulative voting in the election of directors | • For stock corporations, certificate of incorporation or bylaws may specify the number of members necessary to constitute a quorum but in no event |
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Marshall Islands | Delaware | |
shall a quorum consist of less than one-third of the shares entitled to vote at the meeting. In the absence of such specifications, a majority of shares entitled to vote at the meeting shall constitute a quorum | ||
• Any two or more domestic corporations may merge into a single corporation if approved by the board and if authorized by a majority vote of the holders of outstanding shares at a stockholder meeting | • The certificate of incorporation may provide for cumulative voting | |
• Any sale, lease, exchange or other disposition of all or substantially all the assets of a corporation, if not made in the corporation’s usual or regular course of business, once approved by the board, shall be authorized by the affirmative vote of two-thirds of the shares of those entitled to vote at a shareholder meeting | • Any two or more corporations existing under the laws of state may merge into a single corporation pursuant to a board resolution and upon the majority vote by stockholders of each constituent corporation at an annual or special meeting | |
• Every corporation may at any meeting of the board sell, lease or exchange all or substantially all of its property and assets as its board deems expedient and for the best interests of the corporation when so authorized by a resolution adopted by the holders of a majority of the outstanding stock of a corporation entitled to vote | ||
• Any domestic corporation owning at least 90% of the outstanding shares of each class of another domestic corporation may merge such other corporation into itself without the authorization of the shareholders of any corporation | • Any corporation owning at least 90% of the outstanding shares of each class of another corporation may merge the other corporation into itself and assume all of its obligations without the vote or consent of stockholders; however, in case the parent corporation is not the surviving corporation, the proposed merger shall be approved by a majority of the outstanding stock of the parent corporation entitled to vote at a duly called stockholder meeting | |
• Any mortgage, pledge of or creation of a security interest in all or any part of the corporate property may be authorized without the vote or consent of the shareholders, unless otherwise provided for in the articles of incorporation or approval off the shareholders is required pursuant to the BCA | • Any mortgage or pledge of a corporation’s property and assets may be authorized without vote or consent of stockholders, except to the extent that the certificate of incorporation otherwise provides | |
Directors | ||
• Board must consist of at least one member | • Board must consist of at least one member | |
• Number of members can be changed by an amendment to the by-laws, by the shareholders, or by action of the board under the specific provisions of a bylaw | • Number of board members shall be fixed by the bylaws, unless the certificate of incorporation fixes the number of directors | |
• If the board is authorized to change the number of directors, it can only do so by majority of the entire board and so long as no decrease in the number shall shorten the term of any incumbent director | • If the number of directors is fixed by the certificate of incorporation, a change in the number shall be made only by an amendment of the certificate |
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Marshall Islands | Delaware | |
• Removal | • Removal | |
• Any or all of the directors may be removed for cause by vote of the shareholders | • Any or all of the directors may be removed, with or without cause, by the holders of a majority of the shares entitled to vote unless the certificate of incorporation otherwise provides | |
• If the articles of incorporation or the by-laws so provide, any or all of the directors may be removed without cause by vote of the shareholders | • In the case of a classified board, stockholders may effect removal of any or all directors only for cause | |
Dissenter’s Rights of Appraisal | ||
• Shareholders have a right to dissent from a merger or sale of all or substantially all assets not made in the usual course of business, and receive payment of the fair value of their shares | • With limited exceptions, appraisal rights shall be available for the shares of any class or series of stock of a corporation in a merger or consolidation | |
• A holder of any adversely affected shares who does not vote on or consent in writing to an amendment to the articles of incorporation has the right to dissent and to receive payment for such shares if the amendment: | ||
• Alters or abolishes any preferential right of any outstanding shares having preference; or | ||
• Creates, alters or abolishes any provision or right in respect to the redemption of any outstanding shares; or | ||
• Alters or abolishes any preemptive right of such holder to acquire shares or other securities; or | ||
• Excludes or limits the right of such holder to vote on any matter, except as such right may be limited by the voting rights given to new shares then being authorized of any existing or new class | ||
Shareholder’s Derivative Actions | ||
• An action may be brought in the right of a corporation to procure a judgment in its favor, by a holder of shares or of voting trust certificates or of a beneficial interest in such shares or certificates. It shall be made to appear that the plaintiff is such a holder at the time of the transaction of which he complains, or that has shares or his interest therein devolved upon him by operation of law | • In any derivative suit instituted by a stockholder of a corporation, it shall be averred in the complaint that the plaintiff was a stockholder of the corporation at the time of the transaction of which he complains or such stockholder’s stock must have thereafter devolved upon such stockholder by operation of law | |
• Complaint shall set forth with particularity the efforts of the plaintiff to secure the initiation of such action by the board or the reasons for not making such effort | • Other requirements regarding derivative suits have been created by judicial decision, including that a stockholder may not bring a derivative suit unless he or she first demands that the corporation sue on its own behalf and that demand is refused (unless it is shown that such demand would have been futile) |
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• Such action shall not be discontinued, compromised or settled, without the approval of the High Court of the Republic | ||
• Reasonable expenses including attorney’s fees may be awarded if the action is successful | ||
• Corporation may require a plaintiff bringing a derivative suit to give security for reasonable expenses if the plaintiff owns less than 5% of any class of stock and shares have a value of less than $50,000 |
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• | an individual citizen or resident of the United States; | |
• | a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the District of Columbia; | |
• | an estate whose income is includible in gross income for U.S. federal income tax purposes regardless of its source; or a trust if (i) a U.S. court can exercise primary supervision over the trust’s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust, or (ii) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person. |
• | financial institutions or “financial services entities”; | |
• | broker-dealers; | |
• | taxpayers who have elected mark-to-market accounting; | |
• | tax-exempt entities; | |
• | governments or agencies or instrumentalities thereof; | |
• | insurance companies; | |
• | regulated investment companies; | |
• | real estate investment trusts; | |
• | certain expatriates or former long-term residents of the United States; | |
• | persons that actually or constructively own 10% or more of our voting shares; | |
• | persons that hold our warrants; | |
• | persons that hold our common stock or warrants as part of a straddle, constructive sale, hedging, conversion or other integrated transaction; or | |
• | persons whose functional currency is not the U.S. dollar. |
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• | we are organized in a foreign country (our “country of organization”) that grants an “equivalent exemption” to corporations organized in the United States; and |
• | more than 50% of the value of our stock is owned, directly or indirectly, by “qualified shareholders,” that are persons (i) who are “residents” of our country of organization or of another foreign country that grants an “equivalent exemption” to corporations organized in the United States, and (ii) who comply with certain documentation requirements, which we refer to as the “50% Ownership Test,” or |
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• | our stock is primarily and regularly traded on one or more established securities markets in our country of organization, in another country that grants an “equivalent exemption” to United States corporations, or in the United States, which we refer to as the “Publicly-Traded Test.” |
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• | We have, or are considered to have, a fixed place of business in the United States involved in the earning of shipping income; and | |
• | substantially all of ourU.S.-source shipping income is attributable to regularly scheduled transportation, such as the operation of a vessel that follows a published schedule with repeated sailings at regular intervals between the same points for voyages that begin or end in the United States. |
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• | any gain realized by the U.S. Holder on the sale or other taxable disposition of our common stock; and |
• | any “excess distribution” made to the U.S. Holder (generally, any distributions to such holder during a taxable year that are greater than 125% of the average annual distributions received by such holder in respect of our common stock during the three preceding taxable years or, if shorter, such holder’s holding period for the common stock). |
• | the U.S. Holder’s gain or excess distribution will be allocated ratably over the U.S. Holder’s holding period for the common stock; | |
• | the amount allocated to the taxable year in which the U.S. Holder recognized the gain or received the excess distribution, or to any taxable year prior to the first taxable year in which we are a PFIC, will be taxed as ordinary income; | |
• | the amount allocated to other taxable years will be taxed at the highest tax rate in effect for that year and applicable to the U.S. Holder; and | |
• | the interest charge generally applicable to underpayments of tax will be imposed in respect of the tax attributable to each such other taxable year. |
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• | fails to provide an accurate taxpayer identification number; | |
• | is notified by the IRS that backup withholding is required; or | |
• | in certain circumstances, fails to comply with applicable certification requirements. |
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Number | ||||
Underwriter | of shares | |||
Citigroup Global Markets Inc. | ||||
Dahlman, Rose & Company, LLC | ||||
Total |
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Paid by the Company | ||||||||
No Exercise | Full Exercise | |||||||
Per share | $ | $ | ||||||
Total | $ | $ |
• | Short sales involve secondary market sales by the underwriters of a greater number of shares than they are required to purchase in the offering. |
• | “Covered” short sales are sales of shares in an amount up to the number of shares represented by the underwriters’ over-allotment option. |
• | “Naked” short sales are sales of shares in an amount in excess of the number of shares represented by the underwriters’ over-allotment option. |
• | Covering transactions involve purchases of shares either pursuant to the over-allotment option or in the open market after the distribution has been completed in order to cover short positions. |
• | To close a naked short position, the underwriters must purchase shares in the open market after the distribution has been completed. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering. |
• | To close a covered short position, the underwriters must purchase shares in the open market after the distribution has been completed or must exercise the over-allotment option. In determining the source of shares to close the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. |
• | Stabilizing transactions involve bids to purchase shares so long as the stabilizing bids do not exceed a specified maximum. |
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• | to any legal entity that is authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities; |
• | to any legal entity that has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts; |
• | to fewer than 100 natural or legal persons (other than qualified investors as defined below) subject to obtaining the prior consent of the representatives for any such offer; or |
• | in any other circumstances that do not require the publication of a prospectus pursuant to Article 3 of the Prospectus Directive. |
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• | released, issued, distributed or caused to be released, issued or distributed to the public in France; or |
• | used in connection with any offer for subscription or sale of the shares to the public in France. |
• | to qualified investors (investisseurs qualifiés)and/or to a restricted circle of investors (cercle restreint d’investisseurs), in each case investing for their own account, all as defined in, and in accordance witharticles L.411-2, D.411-1, D.411-2, D.734-1, D.744-1, D.754-1 and D.764-1 of the FrenchCode monétaire et financier; |
• | to investment services providers authorized to engage in portfolio management on behalf of third parties; or |
• | in a transaction that, in accordance witharticle L.411-2-II-1°-or-2°-or 3° of the FrenchCode monétaire et financierandarticle 211-2 of the General Regulations (Règlement Général) of theAutorité des Marchés Financiers, does not constitute a public offer (appel public à l’épargne). |
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• | a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or |
• | a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor, |
• | to an institutional investor (for corporations, under Section 274 of the SFA) or to a relevant person defined in Section 275(2) of the SFA, or to any person pursuant to an offer that is made on terms that such shares, debentures and units of shares and debentures of that corporation or such rights and interest in that trust are acquired at a consideration of not less than S$200,000 (or its equivalent in a foreign currency) for each transaction, whether such amount is to be paid for in cash or by exchange of securities or other assets, and further for corporations, in accordance with the conditions specified in Section 275 of the SFA; |
• | where no consideration is or will be given for the transfer; or |
• | where the transfer is by operation of law. |
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SEC registration fee | $ | 8,368 | ||
Printing expenses | $ | |||
Legal fees and expenses | $ | |||
Accounting fees and expenses | $ | |||
Miscellaneous | $ | |||
Total | $ | |||
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Page | ||||
Consolidated Financial Statements of Seanergy Maritime Holdings Corp. and subsidiaries | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 | ||||
F-8 | ||||
F-9 | ||||
F-39 | ||||
F-40 | ||||
F-41 | ||||
F-42 | ||||
F-43 | ||||
Combined Financial Statements of Goldie Navigation Ltd., Pavey Services Ltd., Shoreline Universal Ltd., Valdis Marine Corp., Kalistos Maritime S.A., and Kalithea Maritime S.A. | ||||
F-71 | ||||
F-72 | ||||
F-73 | ||||
F-74 | ||||
F-75 | ||||
F-76 | ||||
F-97 | ||||
F-98 | ||||
F-99 | ||||
F-100 | ||||
F-101 | ||||
Consolidated Financial Statements of Bulk Energy Transport (Holdings) Limited | ||||
F-112 | ||||
F-113 | ||||
F-114 | ||||
F-115 | ||||
F-116 |
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F-117 | ||||
F-136 | ||||
F-137 | ||||
F-138 | ||||
F-139 | ||||
F-140 |
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Notes | 2008 | 2007 | ||||||||||
(In thousands of U.S. dollars, except for share and per share data, unless otherwise stated) | ||||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | 6 | 27,543 | 2,211 | |||||||||
Money market funds — held in trust | 6 | — | 232,923 | |||||||||
Advances (trade) to related party | 7 | 577 | — | |||||||||
Inventories | 872 | — | ||||||||||
Prepaid insurance expenses | 574 | 79 | ||||||||||
Prepaid expenses and other current assets — related parties | 4 | 248 | — | |||||||||
Total current assets | 29,814 | 235,213 | ||||||||||
Fixed assets: | ||||||||||||
Vessels, net | 8 | 345,622 | — | |||||||||
Office equipment, net | 8 | 9 | — | |||||||||
Total fixed assets | 345,631 | — | ||||||||||
Other assets | ||||||||||||
Deferred finance charges | 9 | 2,757 | — | |||||||||
TOTAL ASSETS | 378,202 | 235,213 | ||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
Current liabilities: | ||||||||||||
Current portion of long-term debt | 12 | 27,750 | — | |||||||||
Trade accounts and other payables | 674 | 588 | ||||||||||
Due to underwriters | 13 | 419 | 5,407 | |||||||||
Accrued expenses | 541 | — | ||||||||||
Accrued interest | 166 | — | ||||||||||
Accrued charges on convertible promissory note due to shareholders | 11 | 420 | — | |||||||||
Deferred revenue — related party | 10 | 3,029 | — | |||||||||
Total current liabilities | 32,999 | 5,995 | ||||||||||
Long-term debt, net of current portion | 12 | 184,595 | — | |||||||||
Convertible promissory note due to shareholders | 11 | 29,043 | — | |||||||||
Total liabilities | 246,637 | 5,995 | ||||||||||
Common stock subject to possible redemption — 8,084,999 shares at $10.00 per share | 13 | — | 80,849 | |||||||||
Consolidated shareholders’ equity: | ||||||||||||
Preferred stock, $0.0001 par value; authorized — 1,000,000 shares; issued — none | 13 | — | — | |||||||||
Common stock, $0.0001 par value; authorized shares -89,000,000; issued and outstanding (2008: 22,361,227 shares; 2007: 28,600,000 shares, inclusive of 8,084,999 shares subject to possible redemption) | 13 | 2 | 3 | |||||||||
Additional paid-in capital | 13 | 166,361 | 146,925 | |||||||||
Retained earnings (accumulated deficit) | (34,798 | ) | 1,441 | |||||||||
Total consolidated shareholders’ equity | 131,565 | 148,369 | ||||||||||
Commitments and contingencies | 16 | — | — | |||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 378,202 | 235,213 | ||||||||||
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Consolidated Statements of Operations
For the years ended December 31, 2008 and 2007 and for the period
from August 15, 2006 (Inception) to December 31, 2006
Year Ended | Year Ended | August 15, 2006 to | ||||||||||||||
Notes | December 31, 2008 | December 31, 2007 | December 31, 2006 | |||||||||||||
(In thousands of U.S. dollars, except for share and per share data, unless otherwise stated) | ||||||||||||||||
Revenues: | ||||||||||||||||
Vessel revenue — related party | 35,333 | — | — | |||||||||||||
Commissions — related party | 3 | (880 | ) | — | — | |||||||||||
Vessel revenue — related party, net | 17 | 34,453 | — | — | ||||||||||||
Expenses: | ||||||||||||||||
Direct voyage expenses | 18 | (151 | ) | — | — | |||||||||||
Vessel operating expenses | 19 | (3,180 | ) | — | — | |||||||||||
Voyage expenses — related party | 3 | (440 | ) | — | — | |||||||||||
Management fees — related party | 3 | (388 | ) | — | — | |||||||||||
General and administration expenses | 20 | (1,840 | ) | (445 | ) | (5 | ) | |||||||||
General and administration expenses-related party | 21 | (430 | ) | — | — | |||||||||||
Depreciation | 8 | (9,929 | ) | — | — | |||||||||||
Goodwill impairment loss | 5 | (44,795 | ) | — | — | |||||||||||
Vessels’ impairment loss | 8 | (4,530 | ) | — | — | |||||||||||
Operating (loss) | (31,230 | ) | (445 | ) | (5 | ) | ||||||||||
Other income (expense), net: | ||||||||||||||||
Interest and finance costs | 22 | (3,895 | ) | (45 | ) | — | ||||||||||
Interest and finance costs — shareholders | 9, 11 | (182 | ) | (13 | ) | — | ||||||||||
Interest income — money market funds | 3,361 | 1,948 | 1 | |||||||||||||
Foreign currency exchange gains (losses), net | (39 | ) | — | — | ||||||||||||
(755 | ) | 1,890 | 1 | |||||||||||||
Net (loss) income | (31,985 | ) | 1,445 | (4 | ) | |||||||||||
Net (loss) income per common share | ||||||||||||||||
Basic | 15 | (1.21 | ) | 0.12 | (0.00 | ) | ||||||||||
Diluted | 15 | (1.21 | ) | 0.10 | (0.00 | ) | ||||||||||
Weighted average common shares outstanding | ||||||||||||||||
Basic | 15 | 26,452,291 | 11,754,095 | 7,264,893 | ||||||||||||
Diluted | 15 | 26,452,291 | 15,036,283 | 7,264,893 | ||||||||||||
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Consolidated Statements of Shareholders’ Equity
For the years ended December 31, 2008 and 2007 and for the period
from August 15, 2006 (Inception) to December 31, 2006
Common Stock | ||||||||||||||||||||
Additional | Retained Earnings | Total | ||||||||||||||||||
Par | Paid-in | (Accumulated | Shareholders’ | |||||||||||||||||
# of Shares | Value | Capital | Deficit) | Equity | ||||||||||||||||
(In thousands of U.S. dollars, except for share and per share data, | ||||||||||||||||||||
unless otherwise stated) | ||||||||||||||||||||
Balance, August 15, 2006 (Inception) | — | — | — | — | — | |||||||||||||||
Sale of shares to founding shareholders at $0.0034 per share | 7,264,893 | 1 | 24 | — | 25 | |||||||||||||||
Net loss for the period from August 15, 2006 (Inception) to December 31, 2006 | — | — | — | (4 | ) | (4 | ) | |||||||||||||
Balance December 31, 2006 | 7,264,893 | 1 | 24 | (4 | ) | 21 | ||||||||||||||
Shares surrendered and cancelled | (1,764,893 | ) | — | — | — | — | ||||||||||||||
Sales of shares and warrants in private placement and public offering, net of offering costs of $18,063 | 23,100,000 | 2 | 227,350 | — | 227,352 | |||||||||||||||
Capital contributed by founding shareholders | — | — | 400 | — | 400 | |||||||||||||||
Shares reclassified to “Common stock subject to mandatory redemption” | — | — | (80,849 | ) | — | (80,849 | ) | |||||||||||||
Net income for the year ended December 31, 2007 | — | — | 1,445 | 1,445 | ||||||||||||||||
Balance, December 31, 2007 | 28,600,000 | 3 | 146,925 | 1,441 | 148,369 | |||||||||||||||
Net (loss) for the year ended December 31, 2008 | — | — | — | (31,985 | ) | (31,985 | ) | |||||||||||||
Dividends paid (Note 14) | — | — | — | (4,254 | ) | (4,254 | ) | |||||||||||||
Reclassification of common stock no longer subject to redemption (Note 13) | (6,370,773 | ) | — | 17,144 | — | 17,144 | ||||||||||||||
Reversal of underwriter fees forfeited to redeeming shareholders (Note 13) | �� | — | — | 1,433 | — | 1,433 | ||||||||||||||
Liquidation and dissolution common stock exchange (Note 25) | — | (1 | ) | 1 | — | — | ||||||||||||||
Warrants exercised (Note 13) | 132,000 | — | 858 | — | 858 | |||||||||||||||
Balance December 31, 2008 | 22,361,227 | 2 | 166,361 | (34,798 | ) | 131,565 | ||||||||||||||
F-7
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Consolidated Statements of Cash Flows
For the years ended December 31, 2008 and 2007 and for the period
from August 15, 2006 (Inception) to December 31, 2006
Period From | ||||||||||||
August 15, 2006 | ||||||||||||
Year Ended | Year Ended | (Inception) to | ||||||||||
December 31, 2008 | December 31, 2007 | December 31, 2006 | ||||||||||
(In thousands of U.S. dollars, except for share and per share data, unless otherwise stated) | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net (loss) income | (31,985 | ) | 1,445 | (4 | ) | |||||||
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||||||||||||
Impairment of goodwill | 44,795 | — | — | |||||||||
Impairment of vessels | 4,530 | — | — | |||||||||
Depreciation | 9,929 | — | — | |||||||||
Amortization of deferred finance charges | 224 | — | — | |||||||||
Changes in operating assets and liabilities: | ||||||||||||
(Increase) decrease in — | ||||||||||||
Advances (trade) to related party | (577 | ) | — | — | ||||||||
Inventories | (872 | ) | — | — | ||||||||
Prepaid insurance expenses | (495 | ) | (60 | ) | (20 | ) | ||||||
Prepaid expenses and other current assets — related parties | (248 | ) | — | — | ||||||||
Trade accounts and other payables | 86 | 155 | 3 | |||||||||
Due to underwriters | (3,555 | ) | 46 | — | ||||||||
Accrued expenses | 541 | — | — | |||||||||
Accrued interest on convertible note due to shareholders | 132 | (1 | ) | 1 | ||||||||
Accrued interest | 166 | — | — | |||||||||
Deferred revenue — related party | 3,029 | — | — | |||||||||
Net cash (used in) provided by operating activities | 25,700 | 1,585 | (20 | ) | ||||||||
Cash flows from investing activities: | ||||||||||||
Acquisition of business, net of cash acquired of $NIL | (375,833 | ) | — | — | ||||||||
Increase in trust account from interest earned on funds held in trust | — | (1,923 | ) | — | ||||||||
Funds placed in (used from) trust account from offerings | 232,923 | (231,000 | ) | — | ||||||||
Additions to office furniture and equipment | (9 | ) | — | — | ||||||||
Net cash used in investing activities | (142,919 | ) | (232,923 | ) | — | |||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from initial sale of common stock | — | — | 25 | |||||||||
Gross proceeds from private placement | — | 14 415 | — | |||||||||
Gross proceeds from public offering | — | 231,000 | — | |||||||||
Payment of offering costs | — | (11,796 | ) | (75 | ) | |||||||
Redemption of common shares | (63,705 | ) | — | — | ||||||||
Proceeds from warrants exercised | 858 | |||||||||||
Proceeds from long term debt and revolving facility | 219,845 | — | — | |||||||||
Repayment of long term debt | (7,500 | ) | — | — | ||||||||
Dividends paid | (4,254 | ) | — | — | ||||||||
Proceeds from shareholders’ loans | — | — | 350 | |||||||||
Repayment of shareholders loans | — | (451 | ) | — | ||||||||
Advances from shareholders, net | — | 25 | 76 | |||||||||
Deferred finance charges | (2,693 | ) | — | — | ||||||||
Net cash provided by financing activities | 142,551 | 233,193 | 376 | |||||||||
Net increase in cash | 25,332 | 1,855 | 356 | |||||||||
Cash at beginning of period | 2,211 | 356 | — | |||||||||
Cash at end of period | 27,543 | 2,211 | 356 | |||||||||
Cash paid for: | ||||||||||||
Interest | 3,402 | 14 | — | |||||||||
Income taxes (U.S. source income taxes) | — | — | — | |||||||||
Supplemental disclosure of non-cash financing activities: | ||||||||||||
Capital contributed by founding shareholders in the form of legal fees paid | — | 400 | — | |||||||||
Increase in accrued offering costs and placement fees | — | 5,610 | 181 | |||||||||
Amount of forfeited underwriters’ fee | 1,433 | — | — | |||||||||
Shareholder advances converted to notes payable | — | 101 | — | |||||||||
Common stock subject to possible redemption | — | 80,849 | — | |||||||||
Par value of common stock surrendered and cancelled | — | 176 | — | |||||||||
Issuance of $28,250 convertible promissory note due to shareholders (fair value at issue) | 29,043 | — | — | |||||||||
Arrangement fee on convertible promissory note due to shareholders | 288 | — | — | |||||||||
Common stock no longer subject to redemption | 17,144 | — | — | |||||||||
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Table of Contents
Notes to the Consolidated Financial Statements
December 31, 2008 and 2007
(In thousands of U.S. dollars, except for share and per share data)
1. | Basis of Presentation and General Information: |
F-9
Table of Contents
Remaining | ||||||||||||
Estimated Useful | Dead Weight | |||||||||||
Seller | Jurisdiction | Vessel | Built | Life | Flag | Ton (Dwt) | ||||||
Valdis Marine Corp. | Marshall Islands | African Oryx | 1997 | 14 years | Bahamas | 24,110 | ||||||
Goldie Navigation Ltd. | Marshall Islands | African Zebra | 1985 | 2 years | Bahamas | 38,623 | ||||||
Kalistos Maritime S.A. | Marshall Islands | Davakis G | 2008 | 24 years | Bahamas | 54,051 | ||||||
Kalithea Maritime S.A. | Marshall Islands | Delos Ranger | 2008 | 25 years | Bahamas | 54,051 | ||||||
Pavey Services Ltd. | British Virgin Islands | Bremen Max | 1993 | 9 years | Isle of Man | 73,503 | ||||||
Shoreline Universal Ltd. | British Virgin Islands | Hamburg Max | 1994 | 10 years | Isle of Man | 72,338 |
F-10
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Country of | Date of | |||||||
Company | Incorporation | Incorporation | Vessel Name | Date of Delivery | ||||
Seanergy Management Corp. | Marshall Islands | May 9 , 2008 | N/A | N/A | ||||
Amazons Management Inc. | Marshall Islands | April 21 , 2008 | Davakis G. | August 28, 2008 | ||||
Lagoon Shipholding Ltd. | Marshall Islands | April 21, 2008 | Delos Ranger | August 28, 2008 | ||||
Cynthera Navigation Ltd. | Marshall Islands | March 18, 2008 | African Oryx | August 28, 2008 | ||||
Martinique International Corp. | British Virgin Islands | May 14, 2008 | Bremen Max. | September 11, 2008 | ||||
Harbour Business International Corp. | British Virgin Islands | April 1, 2008 | Hamburg Max. | September 25, 2008 | ||||
Waldeck Maritime Co. | Marshall Islands | April 21, 2008 | African Zebra | September 25, 2008 |
2. | Significant Accounting Policies: |
(a) | Principles of Consolidation |
(b) | Use of Estimates |
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(c) | Foreign Currency Translation |
(d) | Cash and Cash Equivalents |
(e) | Inventories |
(f) | Vessels |
(g) | Vessel Depreciation |
(h) | Impairment of Long-Lived Assets (Vessels) |
F-12
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(i) | Goodwill |
(j) | Dry-Docking and Special Survey Costs |
(k) | Pension and Retirement Benefit Obligations |
F-13
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(l) | Commitments and Contingencies |
(m) | Revenue Recognition |
(n) | Commissions |
(o) | Vessel voyage expenses |
(p) | Repairs and Maintenance |
(q) | Research and Development and Advertising Costs |
(r) | Financing Costs and Capitalized Interest |
F-14
Table of Contents
(s) | Income Taxes |
(t) | Earnings (Losses) per Share |
(u) | Segment Reporting |
(v) | Derivatives |
F-15
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(w) | Share-Based Compensation |
(x) | Fair Value Measurements |
(y) | Fair Value Option |
F-16
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(z) | Hierarchy of Generally Accepted Accounting principles |
(aa) | Recent accounting pronouncements |
F-17
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3. | Transactions with Related Parties: |
• | The Master Agreement to purchase an aggregate of six dry bulk vessels from companies affiliated with certain members of the Restis family, for an aggregate purchase price of $404,876 including direct transaction costs plus contingent consideration (see Note 5). | |
• | A management agreement concluded with EST for the provision of technical management services relating to vessels for an initial period of two years from the date of signing. | |
• | A brokerage agreement was concluded with Safbulk, for the provision of chartering services for an initial period of two years from the date of signing. |
(a) | Management Agreement: |
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(b) | Charter Agreements: |
(c) | Brokerage Agreement: |
(d) | Rental Agreement: |
(e) | Consultancy Agreement: |
F-19
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(f) | V&P Law Firm (Vgenopoulos Partners): |
(g) | Employment Agreements: |
4. | Prepaid Expenses and Other Current Assets — Related Parties |
2008 | 2007 | |||||||
Prepaid commission on hire (SAMC) — (see Note 3(b)) | 68 | — | ||||||
Office rental deposit (Waterfront SA — (see Note 3(d)) | 180 | — | ||||||
248 | — | |||||||
5. | Business Combination: |
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Cash paid | $ | 367,031 | ||
Convertible promissory note — related party (Note 11) | $ | 29,043 | ||
Direct transaction costs | $ | 8,802 | ||
Aggregate acquisition cost | $ | 404,876 | ||
Less: Fair value of assets acquired — Vessels | $ | 360,081 | ||
Goodwill on acquisition | $ | 44,795 | ||
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Balance beginning of year | ||||
Goodwill acquired on August 28, 2008 | 44,795 | |||
Impairment loss | (44,795 | ) | ||
Balance end of year | — | |||
6. | Cash and Cash Equivalents and Money Market Funds — Held in Trust: |
2008 | 2007 | |||||||
Cash at bank | 9,011 | 710 | ||||||
Term deposits | 18,532 | 1,501 | ||||||
27,543 | 2,211 | |||||||
7. | Advances (Trade) to Related Party: |
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8. | Fixed Assets: |
Office Furniture | ||||||||||||
Vessel Cost | and Fittings | Total Value | ||||||||||
Cost: | ||||||||||||
Balance beginning of period | — | — | — | |||||||||
— Additions | — | — | — | |||||||||
Balance, December 31, 2007 | — | — | — | |||||||||
— Additions (Note 5) | 360,081 | 9 | 360,090 | |||||||||
— Impairment charge | (4,530 | ) | — | (4,530 | ) | |||||||
Balance December 31, 2008 | 355,551 | 9 | 355,560 | |||||||||
Accumulated depreciation: | ||||||||||||
Balance beginning of period | — | — | — | |||||||||
— Depreciation charge for the year | — | — | — | |||||||||
Balance, December 31, 2007 | — | — | — | |||||||||
— Depreciation charge for the year | (9,929 | ) | — | (9,929 | ) | |||||||
Balance December 31, 2008 | (9,929 | ) | — | (9,929 | ) | |||||||
Net book value December 31, 2008 | 345,622 | 9 | 345,631 | |||||||||
Net book value December 31, 2007 | — | — | — | |||||||||
Net book value January 1, 2007 | — | — | — | |||||||||
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9. | Deferred Finance Charges: |
2008 | 2007 | |||||||
Arrangement fee convertible promissory note, net of amortization (Note 11) | 238 | — | ||||||
Long term debt issuance costs, net of amortization (Note 12) | 2,519 | — | ||||||
2,757 | — | |||||||
10. | Deferred Revenue — Related Party |
11. | Convertible Promissory Note Due to Shareholders: |
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12. | Long-Term Debt: |
Borrower(s) | 2008 | 2007 | ||||||
(a)Reducing revolving credit facility | 54,845 | — | ||||||
(b)Term facility | 157,500 | — | ||||||
Total | 212,345 | — | ||||||
Less- current portion | (27,750 | ) | — | |||||
Long-term portion | 184,595 | — | ||||||
(a) | Reducing Revolving Credit Facility |
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(b) | Term Facility |
Borrower(s) | Vessel Name | 2008 | 2007 | |||||||
(a)Amazons Management Inc. | Davakis G. | 35,175 | — | |||||||
(b)Lagoon Shipholding Ltd. | Delos Ranger | 35,175 | — | |||||||
(c)Cynthera Navigation | African Oryx | 17,659 | — | |||||||
(d)Martinique International Corp. | Bremen Max | 27,491 | — | |||||||
(e)Harbour Business International Corp. | Hamburg Max | 28,636 | — | |||||||
(f)Waldeck Maritime Co. | African Zebra | 13,364 | — | |||||||
Total | 157,500 | — | ||||||||
Less-current portion | (27,750 | ) | — | |||||||
Long-term portion | 129,750 | — | ||||||||
Reducing Revolving | ||||||||||||
Term Facility | Credit Facility | Total | ||||||||||
2009 | 27,750 | — | 27,750 | |||||||||
2010 | 18,950 | — | 18,950 | |||||||||
2011 | 12,800 | 6,845 | 19,645 | |||||||||
2012 | 12,800 | 12,000 | 24,800 | |||||||||
2013 | 12,800 | 12,000 | 24,800 | |||||||||
Thereafter | 72,400 | 24,000 | 96,400 | |||||||||
157,500 | 54,845 | 212,345 | ||||||||||
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• | not to borrow any money or permit such borrowings to continue other than by way of subordinated shareholders’ loan or enter into any agreement for deferred terms, other than in any customary supplier’s credit terms or any equipment lease or contract hire agreement other than in ordinary course of business; | |
• | no loans, advances or investments in, any person, firm, corporation or joint venture or to officer director, shareholder or customer or any such person; | |
• | not to assume, guarantee or otherwise undertake the liability of any person, firm, company; | |
• | not to authorize any capital commitments; | |
• | not to declare or pay dividends in any amount greater than 60% of the net cash flow of the Group as determined by the lender on the basis of the most recent annual audited financial statements provided, or repay any shareholder’s loans or make any distributions in excess of the above amount without the lenders prior written consent (see below for terms of waiver obtained on December 31, 2008); | |
• | not to change the Chief Executive Officerand/or Chairman of the corporate guarantor without the prior written consent of the lender; | |
• | not to assign, transfer, sell or otherwise or dispose vessels or any of the property, assets or rights without prior written consent of the lender (see also Note 14); | |
• | to ensure that the members of the Restis and Koutsolioutsos families (or companies affiliated with them) own at all times an aggregate of at least 10% of the issued share capital of the corporate guarantor; |
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• | no change of control in either the corporate guarantor without the written consent of the lender; | |
• | not to engage in any business other than the operation of the vessels without the prior written consent of the lender; | |
• | Security margin clause: the aggregate market values of the vessels and the value of any additional security shall not be less than (or at least) 135% of the aggregate of the outstanding revolving credit and term facilities and any amount available for drawing under the revolving facility, less the aggregate amount of all deposits maintained. A waiver dated December 31, 2008 has been received for the period that the vessels continue to be under their current charter agreements (see Note 3(b)). The waiver also stipulates that dividends will not be declaredand/or any shareholders’ loans repaid without the prior written consent of Marfin Egnatia Bank S.A. |
• | ratio of financial indebtedness to earnings, before interest, taxes, depreciation and amortization (EBITDA) shall be less than 6.5:1 (financial indebtedness or Net Debt are defined as the sum of all outstanding debt facilities minus cash and cash equivalents). The covenant is to be tested quarterly on a LTM basis (the “last twelve months”). The calculation of the covenant is not applicable for the quarter ended December 31, 2008. | |
• | the ratio of LTM (“last twelve months”) EBITDA to Net Interest Expense shall not be less than 2:1. The covenant is to be tested quarterly on a LTM basis. The calculation of the covenant is not applicable for the quarter ended December 31, 2008. | |
• | the ratio of total liabilities to total assets shall not exceed 0.70:1; | |
• | unrestricted cash deposits, other than in the favor of the lender shall not be less than 2.5% of the financial indebtedness. | |
• | average quarterly unrestricted cash deposits, other than in the favor of the lender shall not be less than 5% of the financial indebtedness. |
13. | Capital Structure: |
(a) | Common Stock |
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(b) | Common Stock Subject to Redemption |
(c) | Preferred Stock |
(d) | Warrants |
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• | in whole and not in part, | |
• | at a price of $0.10 per warrant at any time, | |
• | upon a minimum of 30 days’ prior written notice of redemption, and if, and only if, the last sale price of the common stock equals or exceeds $14.25 per share for any 20 trading days within a 30 trading day period ending three business days prior to the notice of redemption to the warrant holders. |
(e) | Registration Rights: |
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14. | Dividends: |
F-31
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15. | Earnings per Share: |
2008 | 2007 | 2006 | ||||||||||
Basic: | ||||||||||||
Net (loss) income | $ | (31,985 | ) | $ | 1,445 | $ | (4 | ) | ||||
Weighted average common shares outstanding | 26,452,291 | 11,754,095 | 7,264,893 | |||||||||
Net income (loss) per common share-basic | $ | (1.21 | ) | $ | 0.12 | $ | (0.00 | ) | ||||
Diluted: | ||||||||||||
Net (loss)income | $ | (31,985 | ) | $ | 1,445 | $ | (4 | ) | ||||
Weighted average common shares outstanding | 26,452,291 | 11,754,095 | 7,264,893 | |||||||||
Effect of dilutive warrants | — | 3,282,188 | — | |||||||||
Diluted weighted average common shares outstanding | 26,452,291 | 15,036,283 | 7,264,893 | |||||||||
Net income (loss) per common share-diluted | $ | (1.21 | ) | $ | 0.10 | $ | (0.00 | ) | ||||
Private warrants | 16,016,667 | |||
Public warrants | 22,968,000 | |||
Underwriters purchase options — common shares | 1,000,000 | |||
Underwriters purchase options — warrants | 1,000,000 | |||
Convertible note — to related party | 2,260,000 | |||
Contingently-issuable shares — earn-out (Note 5) | 4,308,075 | |||
Total | 47,552,742 | |||
16. | Commitments and Contingencies: |
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Rental commitments | ||||
2009 | 666 | |||
2010 | 682 | |||
2011 | 700 | |||
Total | 2,048 | |||
Rental receipts | ||||
2009 | 78,490 | |||
17. | Vessel Revenue — Related Party, net: |
18. | Direct Voyage Expenses: |
2008 | 2007 | 2006 | ||||||||||
Bunkers | 107 | — | — | |||||||||
Port expenses | 44 | — | — | |||||||||
Total | 151 | — | — | |||||||||
19. | Vessel Operating Expenses: |
2008 | 2007 | 2006 | ||||||||||
Crew wages and related costs | 1,734 | — | — | |||||||||
Chemicals and lubricants | 591 | — | — | |||||||||
Repairs and maintenance | 449 | — | — | |||||||||
Insurance | 300 | — | — | |||||||||
Miscellaneous expenses | 106 | — | — | |||||||||
Total | 3,180 | — | — | |||||||||
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20. | General and Administration Expenses: |
2008 | 2007 | 2006 | ||||||||||
Auditors’ and accountants’ fees | 695 | — | — | |||||||||
Legal expenses | 432 | — | — | |||||||||
D&O Insurance | 96 | 25 | — | |||||||||
Subscriptions | 38 | — | — | |||||||||
Transportation expenses | 37 | — | — | |||||||||
Professional fees | 371 | 357 | — | |||||||||
Other | 171 | 63 | 5 | |||||||||
Total | 1,840 | 445 | 5 | |||||||||
21. | General and Administration Expenses — Related Party: |
2008 | 2007 | 2006 | ||||||||||
Office rental (Note 3(d)) | 88 | — | — | |||||||||
Consulting fees (Note 3(e)) | 27 | — | — | |||||||||
Salaries (Note 3(g)) | 139 | — | — | |||||||||
Administrative fee (Note 3(a)) | 21 | — | — | |||||||||
BoD remuneration (Note 3(g)) | 155 | — | — | |||||||||
Total | 430 | — | — | |||||||||
22. | Interest and Finance Costs: |
2008 | 2007 | 2006 | ||||||||||
Interest on long-term debt | 2,768 | — | — | |||||||||
Interest on revolving credit facility | 799 | |||||||||||
Amortization of debt issuance costs | 174 | — | — | |||||||||
Commitment fee on un-drawn revolving credit facility | 39 | — | — | |||||||||
Other | 115 | 45 | — | |||||||||
Total | 3,895 | 45 | — | |||||||||
23. | Income Taxes: |
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24. | Financial Instruments: |
(a) | Significant Risks and Uncertainties, including Business and Credit Concentration |
F-35
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(b) | Interest Rate Risk: |
(c) | Fair Value of Financial Instruments |
2008 | 2007 | |||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Financial assets | ||||||||||||||||
Cash and cash equivalents | 27,543 | 27,543 | 2,211 | 2,211 | ||||||||||||
Money market funds — held in trust | — | — | 232,923 | 232,923 | ||||||||||||
Advances (trade) to related party | 577 | 577 | — | — | ||||||||||||
Prepaid insurance expenses | 574 | 574 | 79 | 79 | ||||||||||||
Prepaid expenses and other current assets — related parties | 248 | 248 | — | — | ||||||||||||
Financial liabilities: | ||||||||||||||||
Long-term debt | 212,345 | 212,345 | — | — | ||||||||||||
Convertible promissory note due to shareholders | 29,043 | 28,453 | — | — | ||||||||||||
Trade accounts and other payables | 674 | 674 | 588 | 588 | ||||||||||||
Due to underwriters | 419 | 419 | 5,407 | 5,407 | ||||||||||||
Accrued expenses | 541 | 541 | — | — | ||||||||||||
Accrued interest | 166 | 166 | — | — | ||||||||||||
Deferred revenue — related party | 3,029 | 3,029 | — | — |
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• | Cash and cash equivalents, money market funds — held in trust, advances (trade) to related party, prepaid insurance expenses, prepaid expenses and other current assets — related parties, trade accounts and other payables, due to underwriters, accrued expenses, accrued interest and deferred revenue — related party: The carrying amounts approximate fair value because of the short maturity of these instruments. |
• | Convertible promissory note: The fair value is determined by a trinomial Tree approach that takes a single volatility as an input and takes into account the interest rate curve of the currency of the convertible note, the credit spread of the Company, the stock volatility, as well as any dividends paid by the Company, resulting in an imputed interest rate of 1.38% | |
• | Long-term debt: The carrying value approximates the fair market value as the long-term debt bears interest at floating interest rates. |
(d) | Fair Value Hierarchy |
(e) | Fair Value Option |
25. | Subsequent Events: |
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September 30, | December 31, | |||||||||||
Notes | 2009 | 2008 | ||||||||||
(In thousands of U.S. dollars, | ||||||||||||
except for share data, | ||||||||||||
unless otherwise stated) | ||||||||||||
(Unaudited) | ||||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | 4 | 60,408 | 27,543 | |||||||||
Restricted cash | 5 | 3,564 | — | |||||||||
Due from related parties | 6 | 4,925 | 577 | |||||||||
Inventories | 1,211 | 872 | ||||||||||
Prepaid insurance expenses | 526 | 574 | ||||||||||
Prepaid expenses | 10 | — | ||||||||||
Prepaid expenses and other current assets — related parties | 22 | 248 | ||||||||||
Other current assets | 320 | — | ||||||||||
Total current assets | 70,986 | 29,814 | ||||||||||
Fixed assets: | ||||||||||||
Vessels, net | 7 | 450,920 | 345,622 | |||||||||
Office equipment, net | 7 | 17 | 9 | |||||||||
Total fixed assets | 450,937 | 345,631 | ||||||||||
Other assets | ||||||||||||
Goodwill | 17,275 | — | ||||||||||
Deferred charges | 8 | 7,762 | 2,757 | |||||||||
Other non-current assets | 180 | — | ||||||||||
TOTAL ASSETS | 547,140 | 378,202 | ||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
Current liabilities: | ||||||||||||
Current portion of long-term debt | 11 | 33,206 | 27,750 | |||||||||
Trade accounts and other payables | 573 | 674 | ||||||||||
Due to underwriters | 76 | 419 | ||||||||||
Accrued expenses | 23 | 2,604 | 541 | |||||||||
Accrued interest | 559 | 166 | ||||||||||
Accrued charges on convertible promissory note due to shareholders | 10 | — | 420 | |||||||||
Deferred revenue — related party | 9 | 571 | 3,029 | |||||||||
Deferred revenue | 9 | 62 | — | |||||||||
Total current liabilities | 37,651 | 32,999 | ||||||||||
Long-term debt, net of current portion | 11 | 274,489 | 184,595 | |||||||||
Below market acquired time charters | 24 | 668 | — | |||||||||
Derivative instruments | 22 | 5,884 | — | |||||||||
Convertible promissory note due to shareholders | 10 | — | 29,043 | |||||||||
Total liabilities | 318,692 | 246,637 | ||||||||||
Commitments and contingencies | ||||||||||||
Consolidated shareholders’ equity | ||||||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued | — | — | ||||||||||
Common stock, $0.0001 par value; 200,000,000 and 89,000,000 authorized shares as at September 30, 2009 and December 31, 2008, respectively; 28,947,095 and 22,361,227 shares, issued and outstanding as at September 30, 2009 and December 31, 2008, respectively | 12 | 3 | 2 | |||||||||
Additional paid-in capital | 213,232 | 166,361 | ||||||||||
Accumulated deficit | (1,533 | ) | (34,798 | ) | ||||||||
Total Seanergy shareholders’ equity | 211,702 | 131,565 | ||||||||||
Non controlling interest | 15 | 16,746 | — | |||||||||
Total equity | 228,448 | 131,565 | ||||||||||
TOTAL LIABILITIES AND EQUITY | 547,140 | 378,202 | ||||||||||
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Three Months Ended | Nine Months Ended | |||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||
Notes | 2009 | 2008 | 2009 | 2008 | ||||||||||||||||
(In thousands of U.S. dollars, except for share and per share data, | ||||||||||||||||||||
unless otherwise stated) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||
Vessel revenue — related party | 21,103 | 6,275 | 70,651 | 6,275 | ||||||||||||||||
Vessel revenue | 1,887 | 1,887 | ||||||||||||||||||
Commissions — non related party | (20 | ) | — | (20 | ) | |||||||||||||||
Commissions — related party | 3, 16 | (618 | ) | (153 | ) | (1,856 | ) | (153 | ) | |||||||||||
Vessel revenue, net | 16 | 22,352 | 6,122 | 70,662 | 6,122 | |||||||||||||||
Expenses: | ||||||||||||||||||||
Direct voyage expenses | (42 | ) | (143 | ) | (480 | ) | (143 | ) | ||||||||||||
Vessel operating expenses | 17 | (3,935 | ) | (719 | ) | (9,756 | ) | (719 | ) | |||||||||||
Voyage expenses — related party | 3 | (222 | ) | (77 | ) | (841 | ) | (77 | ) | |||||||||||
Management fees — related party | 3 | (462 | ) | (82 | ) | (1,078 | ) | (82 | ) | |||||||||||
General and administration expenses | 18 | (1,014 | ) | (208 | ) | (3,083 | ) | (805 | ) | |||||||||||
General and administration expenses — related party | 19 | (459 | ) | (50 | ) | (1,553 | ) | (50 | ) | |||||||||||
Amortization of deferred dry-docking costs | (387 | ) | — | (397 | ) | — | ||||||||||||||
Depreciation | 7 | (5,286 | ) | (1,488 | ) | (20,716 | ) | (1,488 | ) | |||||||||||
Gain from acquisition | 3 | 6,813 | — | 6,813 | — | |||||||||||||||
Operating income | 17,358 | 3,355 | 39,571 | 2,758 | ||||||||||||||||
Other income (expense), net: | ||||||||||||||||||||
Interest and finance costs | 20 | (3,451 | ) | (640 | ) | (6,270 | ) | (640 | ) | |||||||||||
Interest and finance costs — shareholders | 8, 10 | (74 | ) | (90 | ) | (386 | ) | (90 | ) | |||||||||||
Interest income — money market funds | 21 | 108 | 644 | 363 | 3,257 | |||||||||||||||
Foreign currency exchange gains (losses), net | (25 | ) | 1 | (80 | ) | 1 | ||||||||||||||
Net Income | 13,916 | 3,270 | 33,198 | 5,286 | ||||||||||||||||
Less: Net Loss Attributable to the Noncontrolling interest | 67 | 67 | ||||||||||||||||||
Net Income Attributable to Seanergy Maritime Holdings | 13,983 | 3,270 | 33,265 | 5,286 | ||||||||||||||||
Net income per common share | ||||||||||||||||||||
Basic | 14 | 0.57 | 0.12 | 1.44 | 0.19 | |||||||||||||||
Diluted | 14 | 0.46 | 0.10 | 1.13 | 0.16 | |||||||||||||||
Weighted average common shares outstanding | ||||||||||||||||||||
Basic | 14 | 24,580,378 | 26,314,831 | 23,109,073 | 27,829,907 | |||||||||||||||
Diluted | 14 | 30,386,931 | 32,882,906 | 29,420,518 | 34,397,982 | |||||||||||||||
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Common stock | ||||||||||||||||||||||||
Additional | Retained Earnings/ | Non | ||||||||||||||||||||||
Paid-In | (Accumulated | controlling | ||||||||||||||||||||||
# of Shares | Par value | Capital | deficit) | interest | Total Equity | |||||||||||||||||||
(In thousands of U.S. dollars, except for share data, unless otherwise stated) | ||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||
Balance January 1, 2008 | 28,600,000 | 3 | 146,925 | 1,441 | 148,369 | |||||||||||||||||||
Net (loss) for the year ended December 31, 2008 | — | — | (31,985 | ) | (31,985 | ) | ||||||||||||||||||
Dividends paid | — | — | — | (4,254 | ) | (4,254 | ) | |||||||||||||||||
Reclassification of common stock no longer subject to redemption | (6,370,773 | ) | — | 17,144 | — | 17,144 | ||||||||||||||||||
Reversal of underwriter fees forfeited to redeeming shareholders | — | — | 1,433 | — | 1,433 | |||||||||||||||||||
Liquidation and dissolution common stock exchange | (1 | ) | 1 | — | — | |||||||||||||||||||
Warrants exercised | 132,000 | — | 858 | — | 858 | |||||||||||||||||||
Balance December 31, 2008 | 22,361,227 | 2 | 166,361 | (34,798 | ) | 131,565 | ||||||||||||||||||
Issuance of common stock to convert promissory note | 6,585,868 | 1 | 29,596 | 29,597 | ||||||||||||||||||||
Issuance of shares due to earn- out | 17,275 | 17,275 | ||||||||||||||||||||||
Non controlling interest | 16,813 | 16,813 | ||||||||||||||||||||||
Net income (loss) for the nine months ended September 30, 2009 | — | — | — | 33,265 | (67 | ) | 33,198 | |||||||||||||||||
Balance September 30, 2009 | 28,947,095 | 3 | 213,232 | (1,533 | ) | 16,746 | 228,448 | |||||||||||||||||
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Nine Months Ended | ||||||||
September 30, | ||||||||
2009 | 2008 | |||||||
(In thousands of US | ||||||||
Dollars, except for | ||||||||
share data, unless | ||||||||
otherwise stated) | ||||||||
(Unaudited) | ||||||||
Cash flows from operating activities: | ||||||||
Net income | 33,198 | 5,286 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation | 20,716 | 1,488 | ||||||
Amortization and write-off of deferred financing costs | 542 | 41 | ||||||
Amortization of deferred Drydocking costs | 397 | 13 | ||||||
Deferred Drydocking costs | (4,437 | ) | — | |||||
Change in fair value of financial instruments | 967 | — | ||||||
Amortization of acquired time charters | (42 | ) | — | |||||
Gain on acquisition | (6,813 | ) | — | |||||
Changes in operating assets and liabilities: | ||||||||
(Increase) decrease in — | ||||||||
Advances (trade) to related party | (3,098 | ) | (2,240 | ) | ||||
Inventories | 1,137 | (742 | ) | |||||
Other current assets | (320 | ) | — | |||||
Trade accounts and other receivables | 232 | — | ||||||
Other non current assets | (180 | ) | — | |||||
Prepaid expenses | (10 | ) | 79 | |||||
Prepaid insurance expenses | 48 | (384 | ) | |||||
Prepaid expenses and other current assets — related parties | 1,587 | (54 | ) | |||||
Accrued expenses | (958 | ) | 38 | |||||
Trade accounts and other payables | (3,912 | ) | 2,685 | |||||
Due to underwriters | (343 | ) | (5,085 | ) | ||||
Accrued charges on convertible note due to shareholders | 670 | 76 | ||||||
Premium amortization on convertible note due to shareholders | (379 | ) | — | |||||
Accrued interest | 227 | 137 | ||||||
Deferred revenue | (2,784 | ) | 2,138 | |||||
Net cash provided by operating activities | 36,445 | 3,476 | ||||||
Cash flows from investing activities: | ||||||||
Funds placed in trust account from offerings | — | 232,923 | ||||||
Acquisition of business, net of cash acquired | 36,374 | (375,283 | ) | |||||
Additions to vessels | (6 | ) | — | |||||
Additions to office furniture and equipment | (15 | ) | — | |||||
Net cash provided by/(used in) investing activities | 36,353 | (142,360 | ) | |||||
Cash flows from financing activities: | ||||||||
Proceeds from long term debt & revolving facility | — | 219,845 | ||||||
Dividends paid | — | (4,254 | ) | |||||
Redemption of common shares | — | (62,271 | ) | |||||
Restricted cash | (2,183 | ) | — | |||||
Noncontrolling interest contribution | 10,000 | — | ||||||
Repayment of long term debt | (47,750 | ) | — | |||||
Deferred finance charges | — | (2,688 | ) | |||||
Net cash (used in) provided by financing activities | (39,933 | ) | 150,632 | |||||
Net increase in cash and cash equivalents | 32,865 | 11,748 | ||||||
Cash and cash equivalents at beginning of period | 27,543 | 2,211 | ||||||
Cash and cash equivalents at end of period | 60,408 | 13,959 | ||||||
Cash paid for: | ||||||||
Interest | 4,089 | 445 | ||||||
Non-cash transactions | ||||||||
Nine months to September 30, 2009: (a) Conversion of the promissory note (note 10), and (b) additional contingent consideration (note 1) | ||||||||
Nine months to September 30, 2008: the issuance of the promissory note (note 10) |
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1. | Basis of Presentation and General Information: |
M/V African Oryx. On September 11, 2008, it took delivery, through its designated nominee, of the fourth vessel, the M/V Bremen Max. On September 25, 2008, Seanergy took delivery, through its designated nominees, of the final two vessels, the M/V Hamburg Max, and the M/V African Zebra. Since the consummation of the business acquisition, the Company provides global transportation solutions in the dry bulk shipping sector through its vessel-owning subsidiaries for a broad range of dry bulk cargoes, including coal, iron ore, and grains or major bulks, as well as bauxite, phosphate, fertilizers and steel products or minor bulks.
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Cash | 36,375 | ||
Restricted cash | 1,380 | ||
Trade and other receivables | 2,844 | ||
Inventories | 1,476 | ||
Vessels | 126,000 | ||
Current portion of long term debt | (16,573) | ||
Accounts payable and accruals | (5,722) | ||
Acquired time charters | (710) | ||
Derivative instruments | (4,917) | ||
Long term debt net of current portion | (126,527) | ||
Noncontrolling interest | (6,813) | ||
Excess of fair value of assets acquired and liabilities assumed over consideration paid | (6,813) | ||
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Country of | Date of | |||||||
Company | Incorporation | Incorporation | Vessel name | Date of Delivery | ||||
Seanergy Management Corp.(1) | Marshall Islands | May 9 , 2008 | N/A | N/A | ||||
Amazons Management Inc.(1) | Marshall Islands | April 21 , 2008 | Davakis G. | August 28, 2008 | ||||
Lagoon Shipholding Ltd.(1) | Marshall Islands | April 21, 2008 | Delos Ranger | August 28, 2008 | ||||
Cynthera Navigation Ltd.(1) | Marshall Islands | March 18, 2008 | African Oryx | August 28, 2008 | ||||
Martinique International Corp.(1) | British Virgin Islands | May 14, 2008 | Bremen Max. | September 11, 2008 | ||||
Harbour Business International Corp.(1) | British Virgin Islands | April 1, 2008 | Hamburg Max. | September 25, 2008 | ||||
Waldeck Maritime Co.(1) | Marshall Islands | April 21, 2008 | African Zebra | September 25, 2008 | ||||
Bulk Energy Transport (Holdings) Limited.(2) | Marshall Islands | December 18, 2006 | N/A | N/A | ||||
Quex Shipping Inc.(2) | British Virgin Islands | January 3 , 2007 | BET Commander | August 13 , 2009 | ||||
Rossington Marine Corp.(2) | British Virgin Islands | January 3 , 2007 | BET Intruder | August 13 , 2009 | ||||
Rayford Navigation Corp.(2) | British Virgin Islands | January 3 , 2007 | BET Prince | August 13 , 2009 | ||||
Creighton Development Inc.(2) | British Virgin Islands | January 3 , 2007 | BET Performer | August 13 , 2009 | ||||
Pulford Ocean Inc.(2) | British Virgin Islands | January 3 , 2007 | BET Scouter | August 13 , 2009 | ||||
Lewisham Maritime Inc.(2) | British Virgin Islands | January 3 , 2007 | BET Fighter | August 13 , 2009 |
(1): | Subsidiaries wholly owned |
(2): | Subsidiaries 50% owned and controlled by the Company |
2. | Significant Accounting Policies: |
(a) | Recent accounting pronouncements |
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3. | Transactions with Related Parties: |
• | The Master Agreement to purchase an aggregate of six dry bulk vessels from companies affiliated with certain members of the Restis family, for an aggregate purchase price of $404,876 including direct transaction costs plus contingent consideration (see Note 1). |
• | A management agreement concluded with Enterprises Shipping and Trading S.A. (“EST”), a company wholly owned by a member of the Restis family, for the provision of technical management services relating to vessels for an initial period of two years from the date of signing. |
• | A brokerage agreement was concluded with Safbulk Pty Ltd (“Safbulk Pty”), a company wholly owned by the Restis family, for the provision of chartering services for an initial period of two years from the date of signing. |
(a) | Management Agreement: |
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(b) | Charter Agreements: |
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(c) | Brokerage Agreement: |
(d) | Sublease Agreement: |
(e) | Consultancy Agreement: |
(f) | V&P Law Firm (Vgenopoulos Partners): |
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(g) | Employment Agreements: |
(h) | BET Shareholders Agreement |
4. | Cash and Cash Equivalents: |
September 30, | December 31, | |||||||
2009 | 2008 | |||||||
Cash at bank | 3,041 | 9,011 | ||||||
Term deposits | 57,367 | 18,532 | ||||||
60,408 | 27,543 | |||||||
5. | Restricted Cash: |
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6. | Due From Related Party: |
7. | Fixed Assets: |
Office Furniture | ||||||||||||
Vessel Cost | and Fittings | Total Value | ||||||||||
Cost: | ||||||||||||
Balance, December 31, 2007 | — | — | — | |||||||||
— Additions (Note 1) | 360,081 | 9 | 360,090 | |||||||||
— Impairment charge | (4,530 | ) | — | (4,530 | ) | |||||||
Balance December 31, 2008 | 355,551 | 9 | 355,560 | |||||||||
— Additions | 126,006 | 15 | 126,021 | |||||||||
Balance September 30, 2009 | 481,557 | 24 | 481,581 | |||||||||
Accumulated depreciation: | ||||||||||||
Balance, December 31, 2007 | — | — | — | |||||||||
— Depreciation charge for the year | (9,929 | ) | — | (9,929 | ) | |||||||
Balance December 31, 2008 | (9,929 | ) | — | (9,929 | ) | |||||||
— Depreciation charge for the nine months ended September 30, 2009 | (20,708 | ) | (7 | ) | (20,715 | ) | ||||||
Balance September 30, 2009 | (30,637 | ) | (7 | ) | (30,644 | ) | ||||||
Net book value September 30, 2009 | 450,920 | 17 | 450,937 | |||||||||
Net book value December 31, 2008 | 345,622 | 9 | 345,631 | |||||||||
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8. | Deferred Charges: |
Dry-Docking | Financing Costs | Total | ||||||||||
December 31, 2008 | — | 2,757 | 2,757 | |||||||||
Additions | 5,751 | 342 | 6,093 | |||||||||
Written-off | — | (149 | ) | (149 | ) | |||||||
Amortization | (397 | ) | (542 | ) | (939 | ) | ||||||
September 30, 2009 | 5,354 | 2,408 | 7,762 | |||||||||
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September 30, | December 31, | |||||||
2009 | 2008 | |||||||
Arrangement fee convertible promissory note due to shareholders, net of amortization (Note 10) | — | 238 | ||||||
Deferred issuance fees | 342 | — | ||||||
Long term debt issuance costs, net of amortization (Note 11) | 2,066 | 2,519 | ||||||
2,408 | 2,757 | |||||||
9. | Deferred Revenue and Deferred Revenue — Related Party |
10. | Convertible Promissory Note Due to Shareholders: |
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11. | Long-Term Debt: |
September 30, | December 31, | |||||||||||
2009 | 2008 | |||||||||||
(a) Reducing revolving credit facility | 54,845 | 54,845 | ||||||||||
(b) Term facility | 129,750 | 157,500 | ||||||||||
(c) BET Loan facility | 123,100 | — | ||||||||||
Total | 307,695 | 212,345 | ||||||||||
Less- current portion | (33,206 | ) | (27,750 | ) | ||||||||
Long-term portion | 274,489 | 184,595 | ||||||||||
(a) | Reducing Revolving Credit Facility |
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(b) | Term Facility |
September 30, | December 31, | |||||||||||||||
Borrower(s) | Vessel name | 2009 | 2008 | |||||||||||||
(a) Amazons Management Inc. | Davakis G. | 28,977 | 35,175 | |||||||||||||
(b) Lagoon Shipholding Ltd. | Delos Ranger | 28,977 | 35,175 | |||||||||||||
(c) Cynthera Navigation Ltd | African Oryx | 14,548 | 17,659 | |||||||||||||
(d) Martinique International Corp. | Bremen Max | 22,648 | 27,491 | |||||||||||||
(e) Harbour Business International Corp. | Hamburg Max | 23,591 | 28,636 | |||||||||||||
(f) Waldeck Maritime Co. | African Zebra | 11,009 | 13,364 | |||||||||||||
Total | 129,750 | 157,500 | ||||||||||||||
Less-current portion | (18,950 | ) | (27,750 | ) | ||||||||||||
Long-term portion | 110,800 | 129,750 | ||||||||||||||
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• | not to borrow any money or permit such borrowings to continue other than by way of subordinated shareholders’ loan or enter into any agreement for deferred terms, other than in any customary supplier’s credit terms or any equipment lease or contract hire agreement other than in ordinary course of business; |
• | no loans, advances or investments in, any person, firm, corporation or joint venture or to any officer, director, shareholder or customer of any such person; |
• | not to assume, guarantee or otherwise undertake the liability of any person, firm, company; |
• | not to authorize any capital commitments; |
• | not to declare or pay dividends in any amount greater than 60% of the net cash flow of the Group as determined by the lender on the basis of the most recent annual audited financial statements provided, or repay any shareholder’s loans or make any distributions in excess of the above amount without the lenders prior written consent (see below for terms of waiver obtained on December 31, 2008); |
• | not to change the Chief Executive Officerand/or Chairman of the corporate guarantor without the prior written consent of the lender; |
• | not to assign, transfer, sell or otherwise or dispose vessels or any of the property, assets or rights without prior written consent of the lender; |
• | to ensure that the members of the Restis and Koutsolioutsos families (or companies affiliated with them) own at all times an aggregate of at least 10% of the issued share capital of the corporate guarantor; |
• | no change of control in the corporate guarantor without the written consent of the lender; |
• | not to engage in any business other than the operation of the vessels without the prior written consent of the lender; |
• | Security margin clause: the aggregate market values of the vessels and the value of any additional security shall not be less than (or at least) 135% of the aggregate of the outstanding revolving credit and term facilities and any amount available for drawing under the revolving facility, less the aggregate amount of all deposits maintained. A waiver dated December 31, 2008 has been received for the period that the vessels continue to be under their current charter agreements (see Note 3(b)). The waiver also stipulates that dividends will not be declaredand/or any shareholders’ loans repaid without the prior written consent of Marfin. |
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• | ratio of financial indebtedness to earnings, before interest, taxes, depreciation and amortization (EBITDA) shall be less than 6.5:1 (financial indebtedness or Net Debt are defined as the sum of all outstanding debt facilities minus cash and cash equivalents). The covenant is to be tested quarterly on a LTM basis (the “last twelve months”); |
• | the ratio of last twelve months EBITDA to Net Interest Expense shall not be less than 2:1. The ratio of total liabilities to total assets shall not exceed 0.70:1; |
• | unrestricted cash deposits, other than in the favor of the lender shall not be less than 2.5% of the financial indebtedness; and |
• | average quarterly unrestricted cash deposits, other than in the favor of the lender shall not be less than 5% of the financial indebtedness. |
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(c) | BET Loan Facility |
September 30, | ||||||||||||
Borrower(s) | Vessel Name | 2009 | ||||||||||
(a) Pulford Ocean Inc | BET Scouter | 23,614 | ||||||||||
(b) Quex Shipping Inc | BET Commander | 25,123 | ||||||||||
(c) Rossington Marine Corp. | BET Intruder | 17,586 | ||||||||||
(d) Rayford Navigation Corp. | BET Prince | 35,172 | ||||||||||
(e) Lewisham Maritime Inc. | BET Fighter | 21,605 | ||||||||||
Total | 123,100 | |||||||||||
Less-current portion | (14,256 | ) | ||||||||||
Long-term portion | 108,844 | |||||||||||
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• | Not to permit any lien to be created over all or any part of the borrowers’ present or future undertakings, assets, rights or revenues to secure any present or future indebtedness; |
• | Not to merge or consolidate with any other person; |
• | Not to sell, transfer, dispose of or exercise direct control over any part of the borrowers’ assets, rights or revenue without the consent of the lender; |
• | Not to undertake any business other than the ownership and operation of vessels and the chartering of vessels to third parties; |
• | Not to acquire any assets other than the BET vessels; |
• | Not to incur any obligations except under the loan agreement and related documents or contracts entered into in the ordinary course of business; |
• | Not to borrow money other than pursuant to the loan agreement, except that the borrowers may borrow money from their shareholders or directors or their related companies as long as such borrowings are subordinate to amounts due under the loan agreement; |
• | Not to guarantee, indemnify or become contingently liable for the obligations of another person or entity except pursuant to the loan agreement and related documents, except, in general, for certain guarantees that arise in the ordinary course of business; |
• | Not to make any loans or grant any credit to any person, except that the borrowers make loans to BET or the borrowers’ related companies as long as they are made on an arm’s length basis in the ordinary course of business and are fully subordinated to the rights of the lender; |
• | Not to redeem their own shares of stock; |
• | Not to permit any change in the legal or beneficial ownership of any of the borrowers or BET or cause any change in the shareholders’ agreement or constitutional documents related to BET; and |
• | Not to enter into any related party transactions except on an arm’s length basis and for full value. |
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Reducing Revolving | ||||||||||||||||
Term Facility | Credit Facility | BET Loan Facility | Total | |||||||||||||
October 1, 2009 — September 30, 2010 | 18,950 | — | 14,256 | 33,206 | ||||||||||||
October 1, 2010 — September 30, 2011 | 9,600 | 6,845 | 14,256 | 30,701 | ||||||||||||
October 1, 2011 — September 30, 2012 | 12,800 | 12,000 | 14,256 | 39,056 | ||||||||||||
October 1, 2012 — September 30, 2013 | 12,800 | 12,000 | 14,256 | 39,056 | ||||||||||||
October 1, 2013 — September 30, 2014 | 12,800 | 12,000 | 14,256 | 39,056 | ||||||||||||
Thereafter | 62,800 | 12,000 | 51,820 | 126,620 | ||||||||||||
129,750 | 54,845 | 123,100 | 307,695 | |||||||||||||
12. | Capital Structure: |
(a) | Common Stock |
(b) | Warrants |
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• | in whole and not in part, |
• | at a price of $0.01 per warrant at any time, |
• | upon a minimum of 30 days’ prior written notice of redemption, and if, and only if, the last sale price of the common stock equals or exceeds $14.25 per share for any 20 trading days within a 30 trading day period ending three business days prior to the notice of redemption to the warrant holders. |
(c) | Registration Rights: |
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13. | Dividends: |
14. | Earnings per Share: |
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3-Months Ended September 30, | 9-Months Ended September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Basic: | ||||||||||||||||
Net income Attributable to Seanergy Maritime Holdings Corp. | $ | 13,983 | $ | 3,270 | $ | 33,265 | $ | 5,286 | ||||||||
Weighted average common shares outstanding | 24,580,378 | 26,314,831 | 23,109,073 | 27,829,907 | ||||||||||||
Net income per common share-basic | $ | 0.57 | $ | 0.12 | $ | 1.44 | $ | 0.19 | ||||||||
Diluted: | ||||||||||||||||
Net income | $ | 13,983 | $ | 3,270 | $ | 33,265 | $ | 5,286 | ||||||||
Interest expense on convertible promissory note due to shareholders | $ | 74 | $ | 90 | $ | 386 | $ | 90 | ||||||||
Diluted net income | $ | 14,057 | $ | 3,360 | $ | 33,651 | $ | 5,376 | ||||||||
Weighted average common shares outstanding | 24,580,378 | 26,314,831 | 23,109,073 | 27,829,907 | ||||||||||||
Effect of dilutive shares | 5,806,553 | 6,568,075 | 6,311,445 | 6,568,075 | ||||||||||||
Diluted weighted average common shares outstanding | 30,386,931 | 32,882,906 | 29,420,518 | 34,397,982 | ||||||||||||
Net income per common share-diluted | $ | 0.46 | $ | 0.10 | $ | 1.13 | $ | 0.16 | ||||||||
Private warrants | 16,016,667 | |||
Public warrants | 22,968,000 | |||
Underwriters purchase options — common shares | 1,000,000 | |||
Underwriters purchase options — warrants | 1,000,000 | |||
Total | 40,984,667 | |||
15. | Commitments and Contingencies: |
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Rental Commitments | ||||
October 1, 2009 — September 30, 2010 | 754 | |||
October 1, 2010 — September 30, 2011 | 774 | |||
October 1, 2011 — September 30, 2012 | 100 | |||
Thereafter | — | |||
Total | 1,628 | |||
16. | Vessel Revenue — Related Party, net: |
Nine Months Ended | ||||||||||||||||
Three Months Ended September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Vessel revenue-related party | 21,103 | 6,275 | 70,651 | 6,275 | ||||||||||||
Vessel revenue | 1,887 | — | 1,887 | |||||||||||||
Commisions-related party | (618 | ) | (153 | ) | (1,856 | ) | (153 | ) | ||||||||
Commisions | (20 | ) | — | (20 | ) | — | ||||||||||
Vessel revenue, net | 22,352 | 6,122 | 70,662 | 6,122 | ||||||||||||
17. | Vessel Operating Expenses: |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Crew wages and related costs | 2,083 | 299 | 4,881 | 299 | ||||||||||||
Chemicals and lubricants | 424 | 298 | 1,343 | 298 | ||||||||||||
Repairs and maintenance | 933 | 59 | 2,468 | 59 | ||||||||||||
Insurance | 446 | 57 | 902 | 57 | ||||||||||||
Miscellaneous expenses | 49 | 6 | 162 | 6 | ||||||||||||
Total | 3,935 | 719 | 9,756 | 719 | ||||||||||||
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18. | General and Administration Expenses: |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Auditors’ and accountants’ fees | 354 | — | 836 | 278 | ||||||||||||
Legal expenses | 109 | — | 662 | 221 | ||||||||||||
D&O Insurance | 30 | 96 | 85 | 96 | ||||||||||||
Other employee salaries | 68 | — | 140 | — | ||||||||||||
Subscriptions | 6 | — | 26 | — | ||||||||||||
Transportation expenses | 4 | 30 | 24 | 30 | ||||||||||||
Professional fees | 35 | 18 | 528 | 18 | ||||||||||||
Other | 408 | 64 | 782 | 162 | ||||||||||||
Total | 1,014 | 208 | 3,083 | 805 | ||||||||||||
19. | General and Administration Expenses — Related Party: |
Three Months | Nine Months | |||||||||||||||
Ended | Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Office rental (Note 3(d)) | 187 | — | 531 | — | ||||||||||||
Consulting fees (Note 3(e)) | 55 | 10 | 165 | 10 | ||||||||||||
Salaries (Note 3(f)) | 108 | — | 322 | — | ||||||||||||
Administrative fee (Note 3(a)) | 6 | — | 17 | — | ||||||||||||
BoD remuneration (Note 3(g)) | 103 | 40 | 518 | 40 | ||||||||||||
Total | 459 | 50 | 1,553 | 50 | ||||||||||||
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20. | Interest and Finance Costs: |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Interest on long-term debt | 1,480 | 494 | 3,164 | 494 | ||||||||||||
Interest on revolving credit facility | 388 | 87 | 1,151 | 87 | ||||||||||||
Amortization of debt issuance costs | 146 | 36 | 453 | 36 | ||||||||||||
Commitment fee on un-drawn revolving credit facility | 4 | 17 | 18 | 17 | ||||||||||||
Other | 1,433 | 6 | 1,484 | 6 | ||||||||||||
Total | 3,451 | 640 | 6,270 | 640 | ||||||||||||
21. | Interest Income — Money Market Funds: |
22. | Financial Instruments: |
(a) | Significant Risks and Uncertainties, including Business and Credit Concentration |
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F-67
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September 30, 2009 | December 31, 2008 | |||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Financial assets: | ||||||||||||||||
Cash and cash equivalents | 60,408 | 60,408 | 27,543 | 27,543 | ||||||||||||
Restricted Cash | 3,564 | 3,564 | — | — | ||||||||||||
Due from related party | 4,925 | 4,925 | 577 | 577 | ||||||||||||
Financial liabilities: | ||||||||||||||||
Long-term debt | 307,695 | 307,695 | 212,345 | 212,345 | ||||||||||||
Convertible promissory note due to shareholders | — | — | 29,043 | 28,453 | ||||||||||||
Trade accounts and other payables | 573 | 573 | 674 | 674 | ||||||||||||
Due to underwriters | 76 | 76 | 419 | 419 | ||||||||||||
Accrued expenses | 2,604 | 2,604 | 541 | 541 | ||||||||||||
Accrued interest | 559 | 559 | 166 | 166 | ||||||||||||
Below market acquired time charter | 668 | 668 | — | — | ||||||||||||
Financial instruments | 5,884 | 5,884 | — | — | ||||||||||||
Accrued charges on convertible promissory note due to shareholders | — | — | 420 | 420 |
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(c) | Fair Value Hierarchy |
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Interest Rate Swap — Liability | — | $ | (5,884 | ) | — | $ | 5,884 | |||||||||
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23. | Accrued expenses |
Nine Months Ended | December 31, | |||||||
2009 | 2008 | |||||||
Accrued dry-docking costs | 1,558 | — | ||||||
Accrued audit and financial advisory costs | 845 | 460 | ||||||
Accrued voyage expenses | 125 | 13 | ||||||
Accrued insurance and related liabilities | 76 | 18 | ||||||
Other accrued liabilities | — | 50 | ||||||
Total | 2,604 | 541 | ||||||
24. | Fair value of below market acquired time charters |
Amortized | Amount to be Amortized as of | |||||||||||||||||||
Amount | to Sep 30, | September 30 | ||||||||||||||||||
Acquired | 2009 | 2010 | 2011 | 2012 | ||||||||||||||||
Fair value of below market acquired time charters | 710 | 42 | 324 | 304 | 40 |
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Note | 2007 | 2006 | ||||||||||
(In thousands of | ||||||||||||
US dollars) | ||||||||||||
ASSETS | ||||||||||||
Vessels, net | 7 | 244,801 | 114,487 | |||||||||
Due from related parties | 19 | — | 480 | |||||||||
Total non-current assets | 244,801 | 114,967 | ||||||||||
Inventories | 8 | 223 | 212 | |||||||||
Trade accounts receivable and other assets | 9 | 928 | 343 | |||||||||
Due from related parties | 19 | 5,833 | 3,841 | |||||||||
Cash and cash equivalents | 10 | 21 | 1,446 | |||||||||
Total current assets | 7,005 | 5,842 | ||||||||||
Total assets | 251,806 | 120,809 | ||||||||||
EQUITY | ||||||||||||
Capital contributions | 11 | 40,865 | 36,960 | |||||||||
Revaluation reserve | 7 | 154,384 | 25,119 | |||||||||
Retained earnings | 4,408 | 6,980 | ||||||||||
Total equity | 199,657 | 69,059 | ||||||||||
LIABILITIES | ||||||||||||
Long-term debt, net | 12 | 38,580 | 41,354 | |||||||||
Total non-current liabilities | 38,580 | 41,354 | ||||||||||
Current portion of long-term debt, net | 12 | 9,750 | 8,420 | |||||||||
Trade accounts payable | 13 | 1,180 | 604 | |||||||||
Accrued expenses | 14 | 1,098 | 352 | |||||||||
Deferred revenue | 781 | 651 | ||||||||||
Due to related parties | 19 | 720 | 353 | |||||||||
Accrued interest expense | 40 | 16 | ||||||||||
Total current liabilities | 13,569 | 10,396 | ||||||||||
Total equity and liabilities | 251,806 | 120,809 | ||||||||||
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
For the three years ended December 31, 2007, 2006 and 2005
Note | 2007 | 2006 | 2005 | |||||||||||||
(In thousands of US dollars) | ||||||||||||||||
Revenue from vessels | 32,297 | 15,607 | 17,016 | |||||||||||||
Revenue from vessels — related party | 19 | 3,420 | 10,740 | 10,140 | ||||||||||||
35,717 | 26,347 | 27,156 | ||||||||||||||
Direct voyage expenses | 3 | (82 | ) | (64 | ) | (139 | ) | |||||||||
35,635 | 26,283 | 27,017 | ||||||||||||||
Expenses: | ||||||||||||||||
Crew costs | 4 | (2,803 | ) | (2,777 | ) | (1,976 | ) | |||||||||
Management fees — related party | 19 | (782 | ) | (752 | ) | (644 | ) | |||||||||
Other operating expenses | 5 | (3,228 | ) | (2,842 | ) | (3,085 | ) | |||||||||
Depreciation | 7 | (12,625 | ) | (6,567 | ) | (6,970 | ) | |||||||||
Impairment reversal/(loss) | 7 | — | 19,311 | (19,311 | ) | |||||||||||
Results from operating activities | 16,197 | 32,656 | (4,969 | ) | ||||||||||||
Finance income | 6 | 143 | 132 | 24 | ||||||||||||
Finance expense | 6 | (2,980 | ) | (3,311 | ) | (2,392 | ) | |||||||||
Net finance cost | (2,837 | ) | (3,179 | ) | (2,368 | ) | ||||||||||
Net profit/(loss) for the year | 13,360 | 29,477 | (7,337 | ) | ||||||||||||
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
For the three years ended December 31, 2007, 2006 and 2005
(Accumulated | ||||||||||||||||
Deficit)/ | ||||||||||||||||
Capital | Revaluation | Retained | ||||||||||||||
Contributions | Reserve | Earnings | Total | |||||||||||||
(In thousands of US dollars) | ||||||||||||||||
Balance at January 1, 2005 | 12,817 | — | (3 | ) | 12,814 | |||||||||||
Net (loss) for the year | — | — | (7,337 | ) | (7,337 | ) | ||||||||||
Total recognized income and expense | — | — | (7,337 | ) | (7,337 | ) | ||||||||||
Capital contributions | 15,980 | — | — | 15,980 | ||||||||||||
Dividends paid | — | — | (3,319 | ) | (3,319 | ) | ||||||||||
Balance at December 31, 2005 | 28,797 | — | (10,659 | ) | 18,138 | |||||||||||
Net profit for the year | — | — | 29,477 | 29,477 | ||||||||||||
Revaluation of vessels | — | 25,119 | — | 25,119 | ||||||||||||
Total recognized income and expense | — | 25,119 | �� | 29,477 | 54,596 | |||||||||||
Capital contributions | 8,163 | — | — | 8,163 | ||||||||||||
Dividends paid | — | — | (11,838 | ) | (11,838 | ) | ||||||||||
Balance at December 31, 2006 | 36,960 | 25,119 | 6,980 | 69,059 | ||||||||||||
Net profit for the year | — | — | 13,360 | 13,360 | ||||||||||||
Revaluation of vessels | — | 129,265 | — | 129,265 | ||||||||||||
Total recognized income and expense | — | 129,265 | 13,360 | 142,625 | ||||||||||||
Capital contributions | 3,905 | — | — | 3,905 | ||||||||||||
Dividends paid | — | — | (15,932 | ) | (15,932 | ) | ||||||||||
Balance at December 31, 2007 | 40,865 | 154,384 | 4,408 | 199,657 | ||||||||||||
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
For the three years ended December 31, 2007, 2006 and 2005
2007 | 2006 | 2005 | ||||||||||
(In thousands of US dollars) | ||||||||||||
Cash flows from operating activities | ||||||||||||
Net profit/(loss) | 13,360 | 29,477 | (7,337 | ) | ||||||||
Adjustments for: | ||||||||||||
Depreciation | 12,625 | 6,567 | 6,970 | |||||||||
Impairment loss on trade accounts receivable and due from related parties | — | 870 | — | |||||||||
Impairment (reversal) loss on vessels | — | (19,311 | ) | 19,311 | ||||||||
Interest expense | 2,914 | 3,272 | 2,371 | |||||||||
Interest income | (143 | ) | (132 | ) | (13 | ) | ||||||
28,756 | 20,743 | 21,302 | ||||||||||
Due from related parties | (1,512 | ) | 1,589 | 6,726 | ||||||||
Inventories | (11 | ) | (56 | ) | (156 | ) | ||||||
Trade accounts receivable and other assets | (585 | ) | (216 | ) | (768 | ) | ||||||
Trade accounts payable | 576 | 96 | 488 | |||||||||
Accrued expenses | 746 | 178 | 174 | |||||||||
Deferred revenue | 130 | (260 | ) | 911 | ||||||||
Due to related parties | 367 | 352 | (144 | ) | ||||||||
28,467 | 22,426 | 28,533 | ||||||||||
Interest paid | (2,890 | ) | (3,265 | ) | (2,364 | ) | ||||||
Net cash from operating activities | 25,577 | 19,161 | 26,169 | |||||||||
Cash flows from investing activities | ||||||||||||
Interest received | 143 | 132 | 13 | |||||||||
Additions for vessels | (12,685 | ) | (5,038 | ) | (86,706 | ) | ||||||
Dry-docking costs | (989 | ) | (1,568 | ) | (18 | ) | ||||||
Net cash used in investing activities | (13,531 | ) | (6,474 | ) | (86,711 | ) | ||||||
Cash flows from financing activities | ||||||||||||
Dividends paid | (15,932 | ) | (11,838 | ) | (3,319 | ) | ||||||
Capital contributions | 3,905 | 8,163 | 15,980 | |||||||||
Proceeds from long-term debt | 8,400 | — | 55,070 | |||||||||
Repayment of long-term debt | (9,844 | ) | (7,573 | ) | (7,182 | ) | ||||||
Net cash (used in) provided from financing activities | (13,471 | ) | (11,248 | ) | 60,549 | |||||||
Net (decrease)/increase in cash and cash equivalents | (1,425 | ) | 1,439 | 7 | ||||||||
Cash and cash equivalents at January 1 | 1,446 | 7 | — | |||||||||
Cash and cash equivalents at December 31 | 21 | 1,446 | 7 | |||||||||
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
December 31, 2007 and 2006
(In thousands of U.S. dollars, except for share and per share data, unless otherwise stated)
1. | Business and basis of presentation |
(a) | General |
Country of | Vessel Name or Hull | |||||
Vessel-Owning Company | Incorporation | Date of Incorporation | Number | |||
Goldie Navigation Ltd. | Marshall Islands | November 23, 2004 | African Zebra | |||
Pavey Services Ltd. | British Virgin Islands | October 29, 2004 | Bremen Max | |||
Shoreline Universal Ltd. | British Virgin Islands | November 25, 2004 | Hamburg Max | |||
Valdis Marine Corp. | Marshall Islands | November 3, 2004 | African Oryx | |||
Kalistos Maritime S.A. | Marshall Islands | February 16, 2004 | KA 215 | |||
Kalithea Maritime S.A. | Marshall Islands | February 16, 2004 | KA 216 |
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(b) | Basis of presentation |
(c) | Statement of compliance |
(d) | Basis of measurement and functional presentation currency |
(e) | Use of estimates and judgments |
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
2. | Significant accounting policies |
(a) | Principles of combination |
(b) | Foreign currency |
(c) | Vessels |
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(d) | Dry-docking costs |
(e) | Financial instruments |
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(f) | Trade accounts receivable |
(g) | Insurance claim |
(h) | Cash and cash equivalents |
(i) | Trade and other amounts payable |
(j) | Long-term debt |
(k) | Inventories |
(l) | Impairment of financial assets |
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(m) | Impairment of non-financial assets |
(n) | Dividends |
(o) | Provisions |
(p) | Employee benefits |
(q) | Revenue |
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(r) | Vessel voyage and other operating expenses |
(s) | Finance income and expenses |
(t) | Income tax |
(u) | Segment reporting |
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(v) | New standards and interpretations not yet adopted |
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
3. | Direct voyage expenses |
2007 | 2006 | 2005 | ||||||||||
Classification fees and surveys | 8 | 6 | 33 | |||||||||
Bunkers expenses | 40 | 25 | 40 | |||||||||
Port expenses | 9 | 15 | 24 | |||||||||
Tugs | 2 | 3 | 27 | |||||||||
Commission and fees | 13 | 8 | 14 | |||||||||
Insurance and other voyage expenses | 10 | 7 | 1 | |||||||||
82 | 64 | 139 | ||||||||||
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
4. | Crew costs |
2007 | 2006 | 2005 | ||||||||||
Basic and supplementary wages | 1,162 | 1,183 | 920 | |||||||||
Overtime | 633 | 635 | 500 | |||||||||
Vacation | 342 | 338 | 200 | |||||||||
Bonus | 448 | 88 | 48 | |||||||||
Other crew expenses | 218 | 533 | 308 | |||||||||
2,803 | 2,777 | 1,976 | ||||||||||
5. | Other operating expenses |
2007 | 2006 | 2005 | ||||||||||
Chemicals and lubricants | 1,432 | 1,192 | 1,151 | |||||||||
Repairs and maintenance | 1,176 | 1,055 | 740 | |||||||||
Insurance | 566 | 558 | 424 | |||||||||
Administration expenses for vessels | 54 | 37 | 54 | |||||||||
Reimbursement to time charters | — | — | 716 | |||||||||
3,228 | 2,842 | 3,085 | ||||||||||
6. | Financial income and expense |
2007 | 2006 | 2005 | ||||||||||
Financial income: | ||||||||||||
Interest income | 143 | 132 | 13 | |||||||||
Foreign exchange gain | — | — | 11 | |||||||||
143 | 132 | 24 | ||||||||||
Financial expense: | ||||||||||||
Interest expense | 2,914 | 3,272 | 2,371 | |||||||||
Amortization of finance costs | 59 | 22 | 21 | |||||||||
Foreign exchange loss | 7 | 17 | — | |||||||||
2,980 | 3,311 | 2,392 | ||||||||||
Net finance cost | 2,837 | 3,179 | 2,368 | |||||||||
F-85
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
7. | Vessels Cost |
Advances to | ||||||||||||||||
Shipyards | ||||||||||||||||
for Vessels | ||||||||||||||||
Under | ||||||||||||||||
Vessels | Construction | Dry-Docking | Total | |||||||||||||
Cost | ||||||||||||||||
Balance at January 1, 2006 | 76,970 | — | 18 | 76,988 | ||||||||||||
Additions | 116 | 4,922 | 1,568 | 6,606 | ||||||||||||
Revaluation | 25,119 | — | — | 25,119 | ||||||||||||
Reversal of impairment loss | 19,311 | — | — | 19,311 | ||||||||||||
Balance at December 31, 2006 | 121,516 | 4,922 | 1,586 | 128,024 | ||||||||||||
Additions | 24 | 12,661 | 989 | 13,674 | ||||||||||||
Revaluation | 129,265 | — | — | 129,265 | ||||||||||||
Balance at December 31, 2007 | 250,805 | 17,583 | 2,575 | 270,963 | ||||||||||||
Accumulated depreciation | ||||||||||||||||
Balance at January 1, 2006 | (6,970 | ) | — | — | (6,970 | ) | ||||||||||
Depreciation | (6,083 | ) | — | (484 | ) | (6,567 | ) | |||||||||
Balance December 31, 2006 | (13,053 | ) | — | (484 | ) | (13,537 | ) | |||||||||
Depreciation | (11,795 | ) | — | (830 | ) | (12,625 | ) | |||||||||
Balance December 31, 2007 | (24,848 | ) | — | (1,314 | ) | (26,162 | ) | |||||||||
Net book value January 1, 2006 | 70,000 | — | 18 | 70,018 | ||||||||||||
Net book value December 31, 2006 | 108,463 | 4,922 | 1,102 | 114,487 | ||||||||||||
Net book value December 31, 2007 | 225,957 | 17,583 | 1,261 | 244,801 | ||||||||||||
F-86
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
8. | Inventories |
2007 | 2006 | |||||||
Lubricants | 223 | 209 | ||||||
Other | — | 3 | ||||||
223 | 212 | |||||||
9. | Trade accounts receivable and other assets |
2007 | 2006 | |||||||
Charterers | 1,237 | 717 | ||||||
Insurance claims | 22 | 26 | ||||||
Prepayments for insurance premiums | 238 | 209 | ||||||
Agents | 48 | 33 | ||||||
Other | 43 | 18 | ||||||
1,588 | 1,003 | |||||||
Impairment loss (Note 15(b)) | (660 | ) | (660 | ) | ||||
928 | 343 | |||||||
10. | Cash and cash equivalents |
2007 | 2006 | |||||||
On demand | 21 | 506 | ||||||
Term deposits | — | 940 | ||||||
21 | 1,446 | |||||||
11. | Capital contributions |
F-87
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Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
Number of | Par Value per | |||||||
Vessel-Owning Companies | Shares | Share | ||||||
Goldie Navigation Ltd. | 500 | — | ||||||
Pavey Services Ltd. | 50,000 | $ | 1 | |||||
Shoreline Universal Ltd. | 50,000 | $ | 1 | |||||
Valdis Marine Corp. | 500 | — | ||||||
Kalistos Maritime S.A. | 500 | — | ||||||
Kalithea Maritime S.A. | 500 | — |
12. | Long-term debt |
Borrower | 2007 | 2006 | ||||||
Goldie Navigation Ltd. | 5,858 | 7,279 | ||||||
Valdis Marine Corp. | 8,576 | 10,684 | ||||||
Pavey Services Ltd. | 12,134 | 15,124 | ||||||
Shoreline Universal Ltd. | 13,390 | 16,687 | ||||||
Kalistos Maritime S.A. | 5,026 | — | ||||||
Kalithea Maritime S.A. | 3,346 | — | ||||||
Total | 48,330 | 49,774 | ||||||
Less: Current portion | 9,750 | 8,420 | ||||||
Long-term portion | 38,580 | 41,354 | ||||||
F-88
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
F-89
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
More | ||||||||||||||||||||||||
Year of | 1 Year | 1 to 2 | 2 to 5 | Than | ||||||||||||||||||||
Maturity | or Less | Years | Years | 5 Years | Total | |||||||||||||||||||
31 December 2006 | 2015 | 8,420 | 4,724 | 14,171 | 22,459 | 49,774 | ||||||||||||||||||
31 December 2007 | 2015 | 9,750 | 4,724 | 14,171 | 19,685 | 48,330 |
13. | Trade accounts payable |
2007 | 2006 | |||||||
Suppliers | 883 | 350 | ||||||
Insurance agents | 167 | 125 | ||||||
Agents | 16 | — | ||||||
Other | 114 | 129 | ||||||
1,180 | 604 | |||||||
14. | Accrued expenses |
2007 | 2006 | |||||||
Masters’ accounts | 225 | 179 | ||||||
Expenses for vessels | 784 | 120 | ||||||
Charterers’ accounts | 51 | 35 | ||||||
Other | 38 | 18 | ||||||
1,098 | 352 | |||||||
F-90
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
15. | Financial instruments |
(a) | Credit risk |
Charterer | 2007 | 2006 | ||||||
B | 50 | % | 100 | % | ||||
E | 43 | % | — |
F-91
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
Charterer | 2007 | 2006 | 2005 | |||||||||
A — related party (Note 19) | — | 38 | % | 37 | % | |||||||
B | 33 | % | 37 | % | 43 | % | ||||||
C | 25 | % | — | — | ||||||||
D | — | 17 | % | — | ||||||||
E | 28 | % | — | — |
2007 | 2006 | |||||||
Up to 30 days | 928 | 243 | ||||||
Past due 31 — 120 days | — | 100 | ||||||
Over 120 days | 660 | 660 | ||||||
1,588 | 1,003 | |||||||
(b) | Liquidity risk |
(c) | Interest rate risk |
F-92
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
Effective | ||||||||||||||||
Note | Interest Rate | Total | 1 Year or Less | |||||||||||||
2006 | ||||||||||||||||
Term deposits | 10 | 5.13 | % | (940 | ) | (940 | ) | |||||||||
Bank loan | 12 | 6.12 | % | 49,774 | 8,420 | |||||||||||
2007 | ||||||||||||||||
Bank loan | 12 | 6.1 | % | 48,330 | 9,750 |
(d) | Sensitivity analysis |
(e) | Currency risk |
US | ||||
Dollars | ||||
2007 | ||||
Euro | 149 | |||
GBP, JPY, ZAR | 88 | |||
2006 | ||||
Euro | 104 | |||
GBP, JPY, ZAR | 89 |
(f) | Fair values |
16. | Capital Management |
F-93
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
17. | Contingencies |
18. | Commitments |
19. | Related parties |
2007 | 2006 | |||||||
Due from related parties — non current | ||||||||
Due from EST | — | 480 | ||||||
Due from related parties — current | ||||||||
Due from EST | 480 | — | ||||||
Due from Lincoln | 4,909 | 3,551 | ||||||
Charter revenue receivable from Swiss Marine Services S.A. | 444 | 290 | ||||||
5,833 | 3,841 | |||||||
Due to related parties — current | ||||||||
Due to EST | 386 | 299 | ||||||
Due to First | 334 | 54 | ||||||
720 | 353 | |||||||
2007 | 2006 | 2005 | ||||||||||
Voyage revenue (Swiss Marine Services S.A.) | 3,420 | 10,740 | 10,140 | |||||||||
Management fees (EST) | (782 | ) | (752 | ) | (644 | ) |
(a) | Directors |
F-94
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
(b) | EST |
(c) | Lincoln and First |
(d) | Swiss Marine Services S.A. (SwissMarine) |
20. | Subsequent events |
F-95
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Combined Financial Statements — (Continued)
December 31, 2007 and 2006
F-96
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
as of June 30, 2008 and December 31, 2007
June 30, | December 31, | |||||||||||
Note | 2008 | 2007 | ||||||||||
(In thousands of US dollars) | ||||||||||||
ASSETS | ||||||||||||
Vessels, net | 10 | 250,022 | 244,801 | |||||||||
Total non-current assets | 250,022 | 244,801 | ||||||||||
Inventories | 458 | 223 | ||||||||||
Trade accounts receivable and other assets | 11 | 1,605 | 928 | |||||||||
Due from related parties | 19 | 13,022 | 5,833 | |||||||||
Cash and cash equivalents | 12 | 4,161 | 21 | |||||||||
Total current assets | 19,246 | 7,005 | ||||||||||
Total assets | 269,268 | 251,806 | ||||||||||
EQUITY | ||||||||||||
Capital contributions | 13 | 48,769 | 40,865 | |||||||||
Revaluation reserve | 154,384 | 154,384 | ||||||||||
(Accumulated deficit) retained earnings | (2,613 | ) | 4,408 | |||||||||
Total equity | 200,540 | 199,657 | ||||||||||
LIABILITIES | ||||||||||||
Long-term debt, net | 14 | 48,520 | 38,580 | |||||||||
Total non-current liabilities | 48,520 | 38,580 | ||||||||||
Current portion of long-term debt, net | 14 | 12,364 | 9,750 | |||||||||
Trade accounts payable | 15 | 3,234 | 1,180 | |||||||||
Accrued expenses | 862 | 1,098 | ||||||||||
Deferred revenue | 16 | 2,339 | 781 | |||||||||
Due to related parties | 19 | 1,395 | 720 | |||||||||
Accrued interest expense | 14 | 40 | ||||||||||
Total current liabilities | 20,208 | 13,569 | ||||||||||
Total equity and liabilities | 269,268 | 251,806 | ||||||||||
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
For the six months ended June 30, 2008 and 2007
Note | 2008 | 2007 | ||||||||||
(In thousands of US dollars) | ||||||||||||
Revenue from vessels | 28,227 | 13,751 | ||||||||||
Revenue from vessels — related party | 19 | — | 3,430 | |||||||||
28,227 | 17,181 | |||||||||||
Direct voyage expenses | 6 | (759 | ) | (60 | ) | |||||||
27,468 | 17,121 | |||||||||||
Expenses: | ||||||||||||
Crew costs | 7 | (2,143 | ) | (1,343 | ) | |||||||
Management fees — related party | 19 | (411 | ) | (387 | ) | |||||||
Other operating expenses | 8 | (1,831 | ) | (1,471 | ) | |||||||
Depreciation | 10 | (16,314 | ) | (6,260 | ) | |||||||
Results from operating activities | 6,769 | 7,660 | ||||||||||
Finance income | 9 | 36 | 81 | |||||||||
Finance expense | 9 | (1,014 | ) | (1,540 | ) | |||||||
Net finance cost | (978 | ) | (1,459 | ) | ||||||||
Net profit for the period | 5,791 | 6,201 | ||||||||||
F-98
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
For the six months ended June 30, 2008 and 2007
(Accumulated | ||||||||||||||||
Capital | Revaluation | Deficit)/Retained | ||||||||||||||
Contributions | Reserve | Earnings | Total | |||||||||||||
(In thousands of US dollars) | ||||||||||||||||
Balance at December 31, 2006 | 36,960 | 25,119 | 6,980 | 69,059 | ||||||||||||
Net profit for the period | — | — | 6,201 | 6,201 | ||||||||||||
Total recognized income and expense | — | — | 6,201 | 6,201 | ||||||||||||
Capital contributions | 1,508 | — | — | 1,508 | ||||||||||||
Balance at June 30, 2007 | 38,468 | 25,119 | 13,181 | 76,768 | ||||||||||||
Balance at December 31, 2007 | 40,865 | 154,384 | 4,408 | 199,657 | ||||||||||||
Net profit for the period | — | — | 5,791 | 5,791 | ||||||||||||
Total recognized income and expense | — | — | 5,791 | 5,791 | ||||||||||||
Capital contributions | 7,904 | — | — | 7,904 | ||||||||||||
Dividends paid | — | — | (12,812 | ) | (12,812 | ) | ||||||||||
Balance at June 30, 2008 | 48,769 | 154,384 | (2,613 | ) | 200,540 | |||||||||||
F-99
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
For the six months ended June 30, 2008 and 2007
2008 | 2007 | |||||||
(In thousands of | ||||||||
US dollars) | ||||||||
Cash flows from operating activities | ||||||||
Net profit | 5,791 | 6,201 | ||||||
Adjustments for: | ||||||||
Depreciation | 16,314 | 6,260 | ||||||
Interest expense | 993 | 1,519 | ||||||
Interest income | (36 | ) | (81 | ) | ||||
23,062 | 13,899 | |||||||
Due from related parties | (7,189 | ) | (8,467 | ) | ||||
Inventories | (235 | ) | (32 | ) | ||||
Trade accounts receivable and other assets | (677 | ) | (280 | ) | ||||
Trade accounts payable | 2,054 | 295 | ||||||
Accrued expenses | (236 | ) | (55 | ) | ||||
Deferred revenue | 1,558 | 91 | ||||||
Due to related parties | 675 | 178 | ||||||
19,012 | 5,629 | |||||||
Interest paid | (1,019 | ) | (1,535 | ) | ||||
Net cash from operating activities | 17,993 | 4,094 | ||||||
Cash flows from investing activities | ||||||||
Interest received | 36 | 81 | ||||||
Dry-docking costs | (521 | ) | (5,071 | ) | ||||
Additions for vessels | (21,014 | ) | (544 | ) | ||||
Net cash used in investing activities | (21,499 | ) | (5,534 | ) | ||||
Cash flows from financing activities | ||||||||
Dividends paid | (12,812 | ) | — | |||||
Capital contributions | 7,904 | 1,508 | ||||||
Proceeds from long-term debt | 21,635 | 3,360 | ||||||
Repayment of long-term debt | (9,081 | ) | (4,854 | ) | ||||
Net cash from financing activities | 7,646 | 14 | ||||||
Net increase/(decrease) in cash and cash equivalents | 4,140 | (1,426 | ) | |||||
Cash and cash equivalents at January 1 | 21 | 1,446 | ||||||
Cash and cash equivalents at June 30 | 4,161 | 20 | ||||||
F-100
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements
1 | Business and basis of presentation |
Country of | Date of | |||||||
Vessel-Owning Company | Incorporation | Incorporation | Vessel Name | Date of Delivery | ||||
Goldie Navigation Ltd. | Marshall Islands | November 23, 2004 | African Zebra | January 3, 2005 | ||||
Pavey Services Ltd. | British Virgin Islands | October 29, 2004 | Bremen Max | January 26, 2005 | ||||
Shoreline Universal Ltd. | British Virgin Islands | November 25, 2004 | Hamburg Max | April 1, 2005 | ||||
Valdis Marine Corp. | Marshall Islands | November 3, 2004 | African Oryx | April 4, 2005 | ||||
Kalistos Maritime S.A. | Marshall Islands | February 16, 2004 | Davakis G. | May 20, 2008 | ||||
Kalithea Maritime S.A. | Marshall Islands | February 16, 2004 | Delos Ranger | August 22, 2008 |
F-101
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
2 | Statement of compliance |
3 | Significant accounting policies |
4 | Use of estimates and judgments |
F-102
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
5 | Financial risk management and capital management |
6 | Direct voyage expenses |
2008 | 2007 | |||||||
Classification fees and surveys | 1 | 4 | ||||||
Bunkers expenses | 608 | 38 | ||||||
Port expenses | 11 | 5 | ||||||
Tugs | — | 2 | ||||||
Commission and fees | 5 | 4 | ||||||
Insurance and other voyage expenses | — | 7 | ||||||
Accrued voyage expenses | 134 | — | ||||||
759 | 60 | |||||||
7 | Crew costs |
2008 | 2007 | |||||||
Basic and supplementary wages | 654 | 579 | ||||||
Overtime | 447 | 319 | ||||||
Vacation | 218 | 164 | ||||||
Bonus | 517 | 151 | ||||||
Other crew expenses | 307 | 130 | ||||||
2,143 | 1,343 |
8 | Other operating expenses |
2008 | 2007 | |||||||
Chemicals and lubricants | 837 | 689 | ||||||
Repairs and maintenance | 508 | 458 | ||||||
Insurance | 334 | 272 | ||||||
Other operating expenses | 152 | 52 | ||||||
1,831 | 1,471 | |||||||
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Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
9 | Financial income and expense |
2008 | 2007 | |||||||
Financial income: | ||||||||
Interest income | 36 | 81 | ||||||
Financial expense: | ||||||||
Interest expense | 993 | 1,519 | ||||||
Amortization of finance costs | 13 | 11 | ||||||
Foreign exchange loss, net | 8 | 10 | ||||||
1,014 | 1,540 | |||||||
Net finance cost | 978 | 1,459 | ||||||
10 | Vessels Cost |
Advances to | ||||||||||||||||
Shipyards for | ||||||||||||||||
Vessels Under | ||||||||||||||||
Vessels | Construction | Dry-Docking | Total | |||||||||||||
Cost | ||||||||||||||||
Balance at January 1, 2007 | 121,516 | 4,922 | 1,586 | 128,024 | ||||||||||||
Additions | 24 | 12,661 | 989 | 13,674 | ||||||||||||
Revaluation | 129,265 | — | — | 129,265 | ||||||||||||
Balance at December 31, 2007 | 250,805 | 17,583 | 2,575 | 270,963 | ||||||||||||
Additions | 675 | 20,339 | 521 | 21,535 | ||||||||||||
Transfers | 25,127 | (25,127 | ) | — | — | |||||||||||
Balance at June 30, 2008 | 276,607 | 12,795 | 3,096 | 292,498 | ||||||||||||
Accumulated depreciation | ||||||||||||||||
Balance at January 1, 2007 | (13,053 | ) | — | (484 | ) | (13,537 | ) | |||||||||
Depreciation | (11,795 | ) | — | (830 | ) | (12,625 | ) | |||||||||
Balance December 31, 2007 | (24,848 | ) | — | (1,314 | ) | (26,162 | ) | |||||||||
Depreciation | (15,709 | ) | — | (605 | ) | (16,314 | ) | |||||||||
Balance June 30, 2008 | (40,557 | ) | — | (1,919 | ) | (42,476 | ) | |||||||||
Net book value January 1, 2007 | 108,463 | 4,922 | 1,102 | 114,487 | ||||||||||||
Net book value December 31, 2007 | 225,957 | 17,583 | 1,261 | 244,801 | ||||||||||||
Net book value June 30, 2008 | 236,050 | 12,795 | 1,177 | 250,022 | ||||||||||||
F-104
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
11 | Trade accounts receivable and other assets |
June 30, | December 31, | |||||||
2008 | 2007 | |||||||
Charterers | 1,324 | 1,237 | ||||||
Insurance claims | 14 | 22 | ||||||
Prepayments for insurance premiums | 675 | 238 | ||||||
Agents | 252 | 48 | ||||||
Other | — | 43 | ||||||
2,265 | 1,588 | |||||||
Impairment loss | (660 | ) | (660 | ) | ||||
1,605 | 928 | |||||||
12 | Cash and cash equivalents |
June 30, | December 31, | |||||||
2008 | 2007 | |||||||
On demand | 61 | 21 | ||||||
Term deposits | 4,100 | — | ||||||
4,161 | 21 | |||||||
13 | Capital contributions |
F-105
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
14 | Long-term debt |
June 30, | December 31, | |||||||
Borrower | 2008 | 2007 | ||||||
Goldie Navigation Ltd. | 5,513 | 5,858 | ||||||
Valdis Marine Corp. | 8,072 | 8,576 | ||||||
Pavey Services Ltd. | 11,421 | 12,134 | ||||||
Shoreline Universal Ltd. | 12,602 | 13,390 | ||||||
Kalistos Maritime S.A. | 16,617 | 5,026 | ||||||
Kalithea Maritime S.A. | 6,659 | 3,346 | ||||||
Total | 60,884 | 48,330 | ||||||
Less: Current portion | 12,364 | 9,750 | ||||||
Long-term portion | 48,520 | 38,580 | ||||||
Year of | 1 Year or | 1 to 2 | 2 to 5 | More Than | ||||||||||||||||||||
Maturity | Less | Years | Years | 5 Years | Total | |||||||||||||||||||
December 31, 2007 | 2015 | 9,750 | 4,724 | 14,171 | 19,685 | 48,330 | ||||||||||||||||||
June 30, 2008 | 2015 | 12,364 | 5,643 | 16,931 | 25,946 | 60,884 |
(a) | Goldie Navigation Ltd., Valdis Marine Corp., Pavey Services Ltd. and Shoreline Universal Ltd. loan facilities: |
F-106
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
F-107
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
(b) | Kalistos Maritime S.A. and Kalithea Maritime S.A.. loan facilities: |
F-108
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
15 | Trade accounts payable |
June 30, | December 31, | |||||||
2008 | 2007 | |||||||
Suppliers | 2,463 | 883 | ||||||
Insurance agents | 543 | 167 | ||||||
Other | 228 | 130 | ||||||
3,234 | 1,180 | |||||||
16 | Deferred revenue |
17 | Contingencies |
18 | Commitments |
F-109
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
19 | Related parties |
June 30, | December 31, | |||||||
2008 | 2007 | |||||||
Due from related parties — current | ||||||||
Due from EST | 600 | 480 | ||||||
Due from Lincoln | 11,978 | 4,909 | ||||||
Charter revenue receivable from Swiss Marine Services S.A. | 444 | 444 | ||||||
13,022 | 5,833 | |||||||
Due to related parties — current | ||||||||
Due to EST | 1,020 | 386 | ||||||
Due to First | 375 | 334 | ||||||
1,395 | 720 | |||||||
2008 | 2007 | |||||||
Voyage revenue (Swiss Marine Services S.A.) | — | 3,430 | ||||||
Management fees (EST) | 411 | 387 |
(a) | Directors |
(b) | Lincoln and First |
(c) | EST |
F-110
Table of Contents
Valdis Marine Corp., Kalistos Maritime S.A. and Kalithea Maritime S.A.
Notes to Condensed Combined Unaudited Interim Financial Statements — (Continued)
June 30, 2008 and December 31, 2007
(d) | Swiss Marine Services S.A. (SwissMarine) |
20 | Subsequent events |
F-111
Table of Contents
F-112
Table of Contents
Note | 2008 | 2007 | ||||||||||
In thousands of | ||||||||||||
U.S. dollars | ||||||||||||
ASSETS | ||||||||||||
Vessels, net | 7 | 276,753 | 430,053 | |||||||||
Total non-current assets | 276,753 | 430,053 | ||||||||||
Inventories | 8 | 1,217 | 682 | |||||||||
Trade accounts receivables and other assets | 9 | 2,025 | 11,075 | |||||||||
Due from related parties | 18 | 16,094 | 2,913 | |||||||||
Cash and cash equivalents | 10 | 35,110 | 26,665 | |||||||||
Total current assets | 54,446 | 41,335 | ||||||||||
Total assets | 331,199 | 471,388 | ||||||||||
EQUITY | ||||||||||||
Capital contributions | 11 | 100,226 | 115,553 | |||||||||
Revaluation reserve | 68,972 | 208,562 | ||||||||||
Retained earnings/(accumulated deficit) | 1,061 | (4,754 | ) | |||||||||
Total equity | 170,259 | 319,361 | ||||||||||
LIABILITIES | ||||||||||||
Long-term debt, net | 12 | 134,152 | 116,208 | |||||||||
Total non-current liabilities | 134,152 | 116,208 | ||||||||||
Fair value of interest rate swap | 15 | 6,935 | 922 | |||||||||
Current portion of long-term debt, net | 12 | 16,573 | 20,875 | |||||||||
Trade accounts payable | 13 | 2,091 | 2,699 | |||||||||
Accrued expenses | 14 | 457 | 262 | |||||||||
Deferred revenue | 212 | 342 | ||||||||||
Due to related parties | 18 | 59 | 10,500 | |||||||||
Accrued interest expense | 461 | 219 | ||||||||||
Total current liabilities | 26,788 | 35,819 | ||||||||||
Total equity and liabilities | 331,199 | 471,388 | ||||||||||
F-113
Table of Contents
Consolidated Statements of Income
For the years ended December 31, 2008 and 2007 and for the period
from December 18, 2006 (inception) to December 31, 2006
Period from | ||||||||||||||||
December 18, | ||||||||||||||||
2006 | ||||||||||||||||
(Inception) to | ||||||||||||||||
December 31, | ||||||||||||||||
Note | 2008 | 2007 | 2006 | |||||||||||||
In thousands of U.S. dollars | ||||||||||||||||
Revenue from vessels | 60,859 | 5,362 | — | |||||||||||||
Revenue from vessels — related party | 18 | 168 | — | — | ||||||||||||
61,027 | 5,362 | |||||||||||||||
Direct voyage expenses | 3 | (1,981 | ) | (22 | ) | — | ||||||||||
59,046 | 5,340 | — | ||||||||||||||
Gain on sale of vessels | 7 | 59,068 | — | — | ||||||||||||
Expenses: | ||||||||||||||||
Crew costs | 4 | (5,213 | ) | (865 | ) | — | ||||||||||
Management fees — related party | 18 | (1,941 | ) | (441 | ) | — | ||||||||||
Other operating expenses | 5 | (6,788 | ) | (1,950 | ) | — | ||||||||||
Depreciation | 7 | (41,824 | ) | (4,350 | ) | — | ||||||||||
Impairment loss | 7 | (2,649 | ) | — | — | |||||||||||
Results from operating activities | 59,699 | (2,266 | ) | — | ||||||||||||
Finance income | 6 | 1,098 | 852 | — | ||||||||||||
Finance expense | 6 | (16,094 | ) | (3,340 | ) | — | ||||||||||
Net finance cost | (14,996 | ) | (2,488 | ) | — | |||||||||||
Net profit/(loss) for the year | 44,703 | (4,754 | ) | — | ||||||||||||
F-114
Table of Contents
Consolidated Statement of Changes in Equity
For the years ended December 31, 2008 and 2007 and for the period from
December 18, 2006 (inception) to December 31, 2006
(Accumulated | ||||||||||||||||
Deficit)/ | ||||||||||||||||
Capital | Revaluation | Retained | ||||||||||||||
Contributions | Reserve | Earnings | Total | |||||||||||||
In thousands of U.S. dollars | ||||||||||||||||
Balance at December 18, 2006 (inception) | — | — | — | — | ||||||||||||
Net (loss) for the period | — | — | — | — | ||||||||||||
Total recognized income and expense | — | — | — | — | ||||||||||||
Balance at December 31, 2006 | — | — | — | — | ||||||||||||
Net (loss) for the year | — | — | (4,754 | ) | (4,754 | ) | ||||||||||
Revaluation of vessels | — | 208,562 | — | 208,562 | ||||||||||||
Total recognized income and expense | — | 208,562 | (4,754 | ) | 203,808 | |||||||||||
Capital contributions | 115,553 | — | — | 115,553 | ||||||||||||
Balance at December 31, 2007 | 115,553 | 208,562 | (4,754 | ) | 319,361 | |||||||||||
Net profit for the year | — | — | 44,703 | 44,703 | ||||||||||||
Revaluation of vessels | — | (139,590 | ) | — | (139,590 | ) | ||||||||||
Total recognized income and expense | — | (139,590 | ) | 44,703 | (94,887 | ) | ||||||||||
Capital withdrawals | (23,512 | ) | — | — | (23,512 | ) | ||||||||||
Capital contributions | 8,185 | — | — | 8,185 | ||||||||||||
Dividends paid | — | — | (38,888 | ) | (38,888 | ) | ||||||||||
Balance at December 31, 2008 | 100,226 | 68,972 | 1,061 | 170,259 | ||||||||||||
F-115
Table of Contents
Consolidated Statements of Cash Flows
For the years ended December 31, 2008 and 2007 and for the period from
December 18, 2006 (inception) to December 31, 2006
Period from | ||||||||||||
December 18, | ||||||||||||
2006 (Inception) | ||||||||||||
to December 31, | ||||||||||||
2008 | 2007 | 2006 | ||||||||||
In thousands of U.S. dollars | ||||||||||||
Cash flows from operating activities | ||||||||||||
Net profit/(loss) | 44,703 | (4,754 | ) | — | ||||||||
Adjustments for: | ||||||||||||
Gain from sale of vessels | (59,068 | ) | — | — | ||||||||
Depreciation | 41,824 | 4,350 | — | |||||||||
Impairment loss on vessels | 2,649 | — | — | |||||||||
Fair value of interest rate swap | 6,013 | 922 | — | |||||||||
36,121 | 518 | — | ||||||||||
Due from related parties | 1,819 | (2,913 | ) | — | ||||||||
Inventories | (535 | ) | (682 | ) | — | |||||||
Trade accounts and other receivables | 9,050 | (575 | ) | — | ||||||||
Trade accounts payables | (609 | ) | 2,698 | — | ||||||||
Accrued expenses | 195 | 262 | — | |||||||||
Deferred revenue | (130 | ) | 342 | — | ||||||||
Due to related parties | (10,441 | ) | — | — | ||||||||
Accrued interest expense | 242 | 219 | — | |||||||||
Dry-docking costs | (3,349 | ) | (2,553 | ) | — | |||||||
Net cash from/(used in) operating activities | 32,363 | (2,684 | ) | — | ||||||||
Cash flows from investing activities | ||||||||||||
Additions for vessels | (94,517 | ) | (223,288 | ) | — | |||||||
Net proceeds from disposals of vessels | 126,172 | — | — | |||||||||
Net cash from/(used in) investing activities | 31,655 | (223,288 | ) | — | ||||||||
Cash flows from financing activities | ||||||||||||
Dividends paid | (53,888 | ) | — | — | ||||||||
Capital withdrawals | (23,512 | ) | — | — | ||||||||
Capital contributions | 8,185 | 115,553 | — | |||||||||
Proceeds from long-term debt | 73,500 | 148,500 | — | |||||||||
Payments of long-term debt | (59,858 | ) | (11,416 | ) | — | |||||||
Net cash (used in)/provided from financing activities | (55,573 | ) | 252,637 | — | ||||||||
Net increase in cash and cash equivalents | 8,445 | 26,665 | — | |||||||||
Cash and cash equivalents at January 1 | 26,665 | — | — | |||||||||
Cash and cash equivalents at December 31 | 35,110 | 26,665 | ||||||||||
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Notes to Consolidated Financial Statements
December 31, 2008 and 2007
In thousands of U.S. dollars, except for shares, unless otherwise stated
(a) | General |
Date of | Country of | |||||||
Vessel Owning Company | Vessel Name | Incorporation | Date of Delivery | Incorporation | ||||
Quex Shipping Inc. | BET Commander | January 3, 2007 | December 17, 2007 | British Virgin Islands | ||||
Rossington Marine Corp. | BET Intruder | January 3, 2007 | March 20, 2008 | British Virgin Islands | ||||
Rayford Navigation Corp. | BET Prince | January 3, 2007 | January 7, 2008 | British Virgin Islands | ||||
Creight Development Inc. | BET Performer* | January 3, 2007 | September 28, 2007 | British Virgin Islands | ||||
Pulford Ocean Inc. | BET Scouter (ex Saldhana) | January 3, 2007 | July 23, 2007 | British Virgin Islands | ||||
Lewisham Maritime Inc. | BET Fighter (ex Ferosa) | January 3, 2007 | August 29, 2007 | British Virgin Islands |
* | The BET Performer was sold on July 10, 2008. |
(b) | Basis of preparation |
(c) | Statement of compliance |
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(d) | Basis of measurement and functional presentation currency |
(e) | Use of estimates and judgments |
(a) | Basis of consolidation |
(b) | Foreign currency |
(c) | Vessels |
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(d) | Dry-docking costs |
(e) | Financial instruments |
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(f) | Trade accounts receivable |
(g) | Insurance claim |
(h) | Cash and cash equivalents |
(i) | Trade and other amounts payable |
(j) | Long-term debt |
(k) | Inventories |
(l) | Impairment of financial costs |
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(m) | Impairment of non-financial assets |
(n) | Dividends |
(o) | Provisions |
(p) | Employee benefits |
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(q) | Revenue |
(r) | Vessel voyage and other operating expenses |
(s) | Finance income and expenses |
(t) | Income tax |
(u) | Segment reporting |
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(v) | New standards and interpretations not yet adopted |
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2008 | 2007 | 2006 | ||||||||||
Bunkers expenses | (1,554 | ) | — | — | ||||||||
Port expenses | (167 | ) | (8 | ) | — | |||||||
Tugs | (60 | ) | — | — | ||||||||
Agents and fees | (200 | ) | (14 | ) | — | |||||||
1,981 | (22 | ) | — | |||||||||
2008 | 2007 | 2006 | ||||||||||
Basic and supplementary wages | (2,400 | ) | (427 | ) | — | |||||||
Overtime | (954 | ) | (154 | ) | — | |||||||
Vacation | (464 | ) | (86 | ) | — | |||||||
Bonus | (545 | ) | (55 | ) | — | |||||||
Travelling expenses | (404 | ) | (79 | ) | — | |||||||
Victualling | (301 | ) | (48 | ) | — | |||||||
Other | (145 | ) | (16 | ) | — | |||||||
(5,213 | ) | (865 | ) | — | ||||||||
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5 | Other operating expenses |
2008 | 2007 | 2006 | ||||||||||
Lubricants | (1,945 | ) | (550 | ) | — | |||||||
Stores and chemicals | (645 | ) | (97 | ) | — | |||||||
Repairs and maintenance | (2,447 | ) | (628 | ) | — | |||||||
Insurance | (1,283 | ) | (437 | ) | — | |||||||
Other | (468 | ) | (238 | ) | — | |||||||
(6,788 | ) | (1,950 | ) | — | ||||||||
6 | Financial income and expense |
2008 | 2007 | 2006 | ||||||||||
Financial Income: | ||||||||||||
Interest income | 1,054 | 828 | — | |||||||||
Other | 44 | 24 | — | |||||||||
1,098 | 852 | — | ||||||||||
2008 | 2007 | 2006 | ||||||||||
Financial expense: | ||||||||||||
Interest income | (9,524 | ) | (2,406 | ) | — | |||||||
Fair value of interest rate swaps | (6,013 | ) | (922 | ) | — | |||||||
Other | (557 | ) | (12 | ) | — | |||||||
(16,094 | ) | (3,340 | ) | — | ||||||||
Net finance cost | (14,996 | ) | (2,488 | ) | — | |||||||
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7 | Vessels |
Advances for | ||||||||||||||||
Cost: | Vessels | Vessels | Dry-Docking | Total | ||||||||||||
Balance at January 1, 2007 | — | — | — | — | ||||||||||||
Additions | 212,788 | 10,500 | 2,553 | 225,841 | ||||||||||||
Revaluation | 208,562 | — | — | 208,562 | ||||||||||||
Balance at December 31, 2007 | 421,350 | 10,500 | 2,553 | 434,403 | ||||||||||||
Additions | 94,518 | — | 3,349 | 97,867 | ||||||||||||
Revaluation | (142,239 | ) | — | — | (142,239 | ) | ||||||||||
Transfers | 10,500 | (10,500 | ) | — | — | |||||||||||
Disposals | (72,691 | ) | — | — | (72,691 | ) | ||||||||||
Balance at December 31, 2008 | 311,438 | — | 5,902 | 317,340 | ||||||||||||
Accumulated depreciation: | ||||||||||||||||
Balance at January 1, 2007 | — | — | — | — | ||||||||||||
Depreciation | (4,350 | ) | — | — | (4,350 | ) | ||||||||||
Balance at December 31, 2007 | (4,350 | ) | — | — | (4,350 | ) | ||||||||||
Disposals | 5,587 | — | — | 5,587 | ||||||||||||
Depreciation | (39,981 | ) | — | (1,843 | ) | (41,824 | ) | |||||||||
Balance December 31, 2008 | (38,744 | ) | — | (1,843 | ) | (40,587 | ) | |||||||||
Net book value January 1, 2007 | — | — | — | — | ||||||||||||
Net book value December 31, 2007 | 417,000 | 10,500 | 2,553 | 430,053 | ||||||||||||
Net book value December 31, 2008 | 272,694 | — | 4,059 | 276,753 | ||||||||||||
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• | Discount rate: 10% | |
• | Discount cash flows up to end of the vessels useful life. | |
• | Daily operating costs $5-$6 | |
• | Earnings assumption: The agreed charter rate plus the average ten to fifteen year charter rate when these are not determined. |
8 | Inventories |
2008 | 2007 | |||||||
Lubricants | 658 | 682 | ||||||
Bunkers | 559 | — | ||||||
1,217 | 682 | |||||||
9 | Trade accounts receivable and other assets |
2008 | 2007 | |||||||
Charters | 1,083 | 26 | ||||||
Guarantee for the purchase of ships | — | 10,500 | ||||||
Prepayments | 942 | 549 | ||||||
2,025 | 11,075 | |||||||
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10 | Cash and cash equivalents |
2008 | 2007 | |||||||
On demand | 574 | 265 | ||||||
Term deposits | 34,536 | 26,400 | ||||||
Cash and cash equivalents | 35,110 | 26,665 | ||||||
11 | Capital |
(a) | Capital contributions |
(b) | Dividends |
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12 | Long-term debt |
2008 | 2007 | |||||||
Borrower | ||||||||
Creighton Development | — | 44,127 | ||||||
Pulford Ocean | 28,914 | 31,207 | ||||||
Lewisham Maritime | 26,453 | 28,550 | ||||||
Rayford Navigation | 43,069 | — | ||||||
Quex Shipping | 30,760 | 33,199 | ||||||
Rossington Maritime | 21,529 | — | ||||||
150,725 | 137,083 | |||||||
Less: Current portion | 16,573 | 20,875 | ||||||
Long-term portion | 134,152 | 116,208 | ||||||
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Years of | 1 Year | 1 to 2 | 2 to 5 | More Than | ||||||||||||||||||||
Maturity | or Less | Years | Years | 5 Years | Total | |||||||||||||||||||
December 31, 2007 | 2015 | 20,875 | 20,875 | 62,625 | 32,708 | 137,083 | ||||||||||||||||||
December 31, 2008 | 2015 | 16,573 | 33,145 | 49,718 | 51,289 | 150,725 |
• | The vessels aggregate market value equal to 125% of the outstanding facility. | |
• | The ratio of total liabilities to total assets shall not exceed 0.7:1. |
13 | Trade accounts payable |
2008 | 2007 | |||||||
Suppliers | 1,453 | 573 | ||||||
Insurance agents | 321 | 338 | ||||||
Repairers | 109 | 1,221 | ||||||
Agents | 208 | 567 | ||||||
2,091 | 2,699 | |||||||
14 | Accrued expenses |
2008 | 2007 | |||||||
Masters’ accounts | 390 | 262 | ||||||
Other | 67 | — | ||||||
457 | 262 | |||||||
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15 | Financial instruments |
• | Credit risk; | |
• | Liquidity risk; | |
• | Market risk defined as interest rate risk and currency risk. |
(a) | Credit risk |
Charter | 2008 | 2007 | ||||||
A | 12 | % | 51 | % | ||||
B | — | 26 | % | |||||
C | 11 | % | 18 | % | ||||
D | 14 | % | — | |||||
E | 15 | % | — |
Charter | 2008 | 2007 | ||||||
B | — | 43 | % | |||||
C | — | 55 | % | |||||
D | 87 | % | — |
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2008 | 2007 | |||||||
Up to 30 days | 643 | — | ||||||
Past due31-120 days | 356 | 14 | ||||||
Over 120 days | 84 | 12 | ||||||
1,083 | 26 | |||||||
(b) | Liquidity risk |
(c) | Interest rate risk |
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Effective | 1 Year | |||||||||||||||||||
Note | Interest Rate | Total | or Less | 2 to 5 Years | ||||||||||||||||
2007 | ||||||||||||||||||||
Term deposits | 10 | 3.77 | % | (26,400 | ) | (26,400 | ) | — | ||||||||||||
Long-term loan | 12 | 5.61 | % | 137,083 | 30,000 | 107,083 |
Effective | 1 Year | |||||||||||||||||||
Note | Interest Rate | Total | or Less | 2 to 5 Years | ||||||||||||||||
2008 | ||||||||||||||||||||
Term deposits | 10 | 2.22 | % | (34,536 | ) | (34,536 | ) | — | ||||||||||||
Long-term loan | 12 | 4.91 | % | 150,725 | 20,725 | 130,000 |
(d) | Currency risk |
US Dollar | ||||
2008 | ||||
EUR | 505 | |||
GBP and other | 480 |
US Dollar | ||||
2007 | ||||
EUR | 196 | |||
GBP and other | 151 |
(e) | Sensitivity analysis |
(f) | Fair values |
(16) | Capital management |
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17 | Contingencies |
18 | Related parties |
(a) | Enterprises Shipping and Trading SA |
(b) | Constellation Energy Commodities Group Limited |
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2008 | 2007 | |||||||
Due from related parties — current | ||||||||
EST | 832 | 2,334 | ||||||
Constellation | 262 | 79 | ||||||
Due from shareholders | 15,000 | 500 | ||||||
16,094 | 2,913 | |||||||
2008 | 2007 | |||||||
Due from related parties — current | ||||||||
First investment | — | 10,500 | ||||||
Constellation | 59 | — | ||||||
59 | 10,500 | |||||||
2008 | 2007 | 2006 | ||||||||||
Revenue from vessels | ||||||||||||
Constellation | 168 | — | — | |||||||||
Management fees | ||||||||||||
EST | (1,449 | ) | (325 | ) | — | |||||||
Constellation | (492 | ) | (116 | ) | — | |||||||
(1,941 | ) | (441 | ) | — | ||||||||
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June 30, | December 31, | |||||||||
Note | 2009 | 2008 | ||||||||
In thousands of U.S. dollars | ||||||||||
ASSETS | ||||||||||
Vessels, net | 9 | 128,879 | 276,753 | |||||||
Total non-current assets | 128,879 | 276,753 | ||||||||
Inventories | 10 | 1,146 | 1,217 | |||||||
Trade accounts receivables and other assets | 11 | 5,978 | 2,025 | |||||||
Due from related parties | 19 | 18,441 | 16,094 | |||||||
Cash and cash equivalents | 12 | 29,953 | 35,110 | |||||||
Total current assets | 55,518 | 54,446 | ||||||||
TOTAL ASSETS | 184,397 | 331,199 | ||||||||
EQUITY | ||||||||||
Capital contributions | 13 | 100,226 | 100,226 | |||||||
Revaluation reserve | — | 68,972 | ||||||||
Retained earnings/(accumulated deficit) | (68,808 | ) | 1,061 | |||||||
Total equity | 31,418 | 170,259 | ||||||||
LIABILITIES | ||||||||||
Long-term debt, net | 14 | 125,899 | 134,152 | |||||||
Total non-current liabilities | 125,899 | 134,152 | ||||||||
Fair value of interest rate swap | 4,656 | 6,935 | ||||||||
Current portion of long-term debt, net | 14 | 16,573 | 16,573 | |||||||
Trade accounts payable | 15 | 2,278 | 2,091 | |||||||
Accrued expenses | 16 | 746 | 457 | |||||||
Deferred revenue | 1,818 | 212 | ||||||||
Due to related parties | 19 | — | 59 | |||||||
Accrued interest expense | 1,009 | 461 | ||||||||
Total current liabilities | 27,080 | 26,788 | ||||||||
TOTAL EQUITY AND LIABILITIES | 184,397 | 331,199 | ||||||||
consolidated unaudited interim financial statements
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Note | 2009 | 2008 | ||||||||
In thousands of U.S. dollars | ||||||||||
Revenue from vessels | 17,481 | 37,124 | ||||||||
Direct voyage expenses | 5 | (2,524 | ) | (1,880 | ) | |||||
14 ,957 | 35,244 | |||||||||
Expenses: | ||||||||||
Crew costs | 6 | (2,346 | ) | (2,691 | ) | |||||
Management fees — related party | 19 | (723 | ) | (1,000 | ) | |||||
Other operating expenses | 7 | (3,081 | ) | (3,675 | ) | |||||
Depreciation | 9 | (14,484 | ) | (21,200 | ) | |||||
Impairment loss | 11 | (64,604 | ) | — | ||||||
Results from operating activities | (70,281 | ) | 6,678 | |||||||
Finance income | 8 | 2,358 | 3,314 | |||||||
Finance expense | 8 | (1,953 | ) | (5,685 | ) | |||||
Net finance income/(cost) | 8 | 405 | (2,371 | ) | ||||||
Net profit/(loss) for the period | (69,876 | ) | 4,307 | |||||||
Other comprehensive income | ||||||||||
Revaluation of vessels | (68,972 | ) | 23,000 | |||||||
Other comprehensive income/(loss) for the period | (68,972 | ) | 23,000 | |||||||
Total comprehensive income/(loss) for the period | (138,848 | ) | 27,307 | |||||||
consolidated unaudited interim financial statements
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(Accumulated | ||||||||||||||||
Deficit)/ | ||||||||||||||||
Capital | Revaluation | Retained | ||||||||||||||
Contributions | Reserve | Earnings | Total | |||||||||||||
In thousands of U.S. dollars | ||||||||||||||||
Balance at December 31, 2007 | 115,553 | 208,562 | (4,754 | ) | 319,361 | |||||||||||
Net profit for the period | — | — | 4,307 | 4,307 | ||||||||||||
Revaluation of vessels | — | 23,000 | — | 23,000 | ||||||||||||
— | 23,000 | 4,307 | 27,307 | |||||||||||||
Capital contributions | 8,186 | — | — | 8,186 | ||||||||||||
Balance at June 30, 2008 | 123,739 | 231,562 | (447 | ) | 354,854 | |||||||||||
Balance at December 31, 2008 | 100,226 | 68,972 | 1,061 | 170,259 | ||||||||||||
Net loss for the period | — | — | (69,876 | ) | (69,876 | ) | ||||||||||
Revaluation of vessels | — | (68,972 | ) | — | (68,972 | ) | ||||||||||
— | (68,972 | ) | (69,876 | ) | (138,848 | ) | ||||||||||
Other | — | — | 7 | 7 | ||||||||||||
Balance at June 30, 2009 | 100,226 | — | (68,808 | ) | 31,418 | |||||||||||
consolidated unaudited interim financial statements
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2009 | 2008 | |||||||
In thousands of US Dollars | ||||||||
Cash flows from operating activities | ||||||||
Net profit/(loss) | (69,876 | ) | 4,307 | |||||
Adjustments for: | ||||||||
Depreciation | 14,484 | 21,200 | ||||||
Impairment loss trade receivables | 164 | — | ||||||
Fair value of interest rate swap | (2,279 | ) | (2,651 | ) | ||||
Due from related parties | (2,406 | ) | 1,174 | |||||
Inventories | 72 | (369 | ) | |||||
Trade accounts and other receivables | (4,117 | ) | (5,285 | ) | ||||
Trade accounts payables | 188 | (131 | ) | |||||
Accrued expenses | 2,105 | 454 | ||||||
Deferred revenue | (213 | ) | 148 | |||||
Accrued interest expense | 549 | 525 | ||||||
Net cash from/(used in) operating activities | 3,111 | 19,372 | ||||||
Cash flows from investing activities | ||||||||
Dry-docking costs | — | (2,050 | ) | |||||
Additions for vessels | (22 | ) | (94,502 | ) | ||||
Net cash from/(used in) investing activities | (22 | ) | (96,552 | ) | ||||
Cash flows from financing activities | ||||||||
Other | 7 | — | ||||||
Capital contributions | — | 8,186 | ||||||
Proceeds from long-term debt | — | 63,113 | ||||||
Payment of long-term debt | (8,253 | ) | — | |||||
Net cash (used in)/provided from financing activities | (8,246 | ) | 71,299 | |||||
Net decrease in cash and cash equivalents | (5,157 | ) | (5,881 | ) | ||||
Cash and cash equivalents at January 1 | 35,110 | 26,665 | ||||||
Cash and cash equivalents at June 30 | 29,953 | 20,784 | ||||||
consolidated unaudited interim financial statements
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Notes to Condensed Consolidated Unaudited Interim Statements
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
1 | Business and basis of presentation |
(a) | General |
Date of | Country of | |||||||
Vessel Owning Company | Vessel Name | Incorporation | Date of Delivery | Incorporation | ||||
Quex Shipping Inc. | Bet Commander | January 3, 2007 | December 17, 2007 | British Virgin Islands | ||||
Rossington Marine Corp. | Bet Intruder | January 3, 2007 | March 20, 2008 | British Virgin Islands | ||||
Rayford Navigation Corp. | Bet Prince | January 3, 2007 | January 7, 2008 | British Virgin Islands | ||||
Creight Development Inc. | Bet Performer | January 3, 2007 | September 28, 2007 | British Virgin Islands | ||||
Pulford Ocean Inc | Bet Scouter (ex Saldhana) | January 3, 2007 | July 23, 2007 | British Virgin Islands | ||||
Lewisham Maritime Inc. | Bet Fighter (ex Ferosa) | January 3, 2007 | August 29, 2007 | British Virgin Islands |
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
(b) | Statement of compliance |
(d) | Basis of measurement and functional presentation currency |
2 | Significant accounting policies |
(i) | Accounting for borrowing costs |
(ii) | Determination and presentation of operating segments |
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
(iii) | Presentation of financial statements |
3 | Use of estimates and judgments |
• | the fair value of vessels | |
• | the estimated loss of receivables |
4 | Financial risk management and capital management |
5 | Direct voyage expenses |
2009 | 2008 | |||||||
Bunkers expenses | (1,627 | ) | (1,555 | ) | ||||
Port expenses | (421 | ) | (79 | ) | ||||
Tugs | (186 | ) | (92 | ) | ||||
Agents and fees | (53 | ) | (35 | ) | ||||
Other | (237 | ) | (119 | ) | ||||
(2,524 | ) | (1,880 | ) | |||||
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
6 | Crew costs |
2009 | 2008 | |||||||
Basic and supplementary wages | (806 | ) | (1,374 | ) | ||||
Overtime | (543 | ) | (481 | ) | ||||
Vacation | (260 | ) | (232 | ) | ||||
Bonus | (448 | ) | (156 | ) | ||||
Travelling expenses | (147 | ) | (276 | ) | ||||
Victualling | (122 | ) | (146 | ) | ||||
Other | (20 | ) | (26 | ) | ||||
(2,346 | ) | (2,691 | ) | |||||
7 | Other operating expenses |
2009 | 2008 | |||||||
Lubricants | (885 | ) | (1,283 | ) | ||||
Stores and chemicals | (367 | ) | (443 | ) | ||||
Repairs and maintenance | (920 | ) | (1,152 | ) | ||||
Insurance | (777 | ) | (691 | ) | ||||
Other | (132 | ) | (106 | ) | ||||
(3,081 | ) | (3,675 | ) | |||||
8 | Financial income and expense |
2009 | 2008 | |||||||
Financial income: | ||||||||
Interest income | 68 | 523 | ||||||
Fair value of interest rate swaps | 2,279 | 2,791 | ||||||
Other | 11 | — | ||||||
2,358 | 3,314 | |||||||
Financial expense: | ||||||||
Interest expense | (1,877 | ) | (5,234 | ) | ||||
Fair value of interest rate swaps | — | (141 | ) | |||||
Other | (76 | ) | (310 | ) | ||||
(1,953 | ) | (5,685 | ) | |||||
Net finance (cost)/ income | 405 | (2,371 | ) | |||||
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
9 | Vessels |
Advances for | Dry- | |||||||||||||||
Cost | Vessels | Vessels | Docking | Total | ||||||||||||
Balance at January 1, 2008 | 421,350 | 10,500 | 2,553 | 434,403 | ||||||||||||
Additions | 94,518 | — | 3,349 | 97,867 | ||||||||||||
Revaluation | (142,239 | ) | — | — | (142,239 | ) | ||||||||||
Transfers | 10,500 | (10,500 | ) | — | — | |||||||||||
Disposals | (72,691 | ) | — | — | (72,691 | ) | ||||||||||
Balance at December 31, 2008 | 311,438 | — | 5,902 | 317,340 | ||||||||||||
Additions | 22 | — | — | 22 | ||||||||||||
Reversal revaluation | (68,972 | ) | — | — | (68,972 | ) | ||||||||||
Impairment | (64,440 | ) | — | — | (64,440 | ) | ||||||||||
Balance at June 30, 2009 | 178,048 | — | 5,902 | 183,950 | ||||||||||||
Accumulated depreciation | ||||||||||||||||
Balance January 1, 2008 | (4,350 | ) | — | — | (4,350 | ) | ||||||||||
Disposals | 5,587 | — | — | 5,587 | ||||||||||||
Depreciation | (39,981 | ) | — | (1,843 | ) | (41,824 | ) | |||||||||
Balance December 31, 2008 | (38,744 | ) | — | (1,843 | ) | (40,587 | ) | |||||||||
Depreciation | (13,304 | ) | — | (1,180 | ) | (14,484 | ) | |||||||||
Balance June 30, 2009 | (52,048 | ) | — | (3,023 | ) | (55,071 | ) | |||||||||
Net book value January 1, 2008 | 417,000 | 10,500 | 2,553 | 430,053 | ||||||||||||
Net book value December 31, 2008 | 272,694 | — | 4,059 | 276,753 | ||||||||||||
Net book value June 30, 2009 | 126,000 | — | 2,879 | 128,879 | ||||||||||||
10 | Inventories |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Lubricants | 640 | 658 | ||||||
Bunkers | 506 | 559 | ||||||
1,146 | 1,217 | |||||||
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
11 | Trade accounts receivable and other assets |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Charters | 4,604 | 1,083 | ||||||
Prepayments | 1,538 | 942 | ||||||
6,142 | 2,025 | |||||||
Impairment loss | (164 | ) | — | |||||
5,978 | 2,025 | |||||||
12 | Cash and cash equivalents |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
On demand | 103 | 574 | ||||||
Term deposits | 29,850 | 34,536 | ||||||
Cash and cash equivalents | 29,953 | 35,110 | ||||||
13 | Capital |
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
14 | Long-term debt |
June 30, | December 31, | |||||||
Borrower | 2009 | 2008 | ||||||
Pulford Ocean | 27,331 | 28,914 | ||||||
Lewisham Maritime | 25,004 | 26,453 | ||||||
Rayford Navigation | 40,711 | 43,069 | ||||||
Quex Shipping | 29,076 | 30,760 | ||||||
Rossington Maritime | 20,350 | 21,529 | ||||||
142,472 | 150,725 | |||||||
Less: Current portion | 16,573 | 16,573 | ||||||
Long-term portion | 125,899 | 134,152 | ||||||
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
Years of | 1 Year | 1 to 2 | 2 to 5 | More than | ||||||||||||||||||||
Maturity | or Less | Years | years | 5 Years | Total | |||||||||||||||||||
December 31, 2008 | 2015 | 16,573 | 33,145 | 49,718 | 51,289 | 150,725 | ||||||||||||||||||
June 30, 2009 | 2015 | 16,573 | 33,145 | 49,718 | 43,036 | 142,472 |
15 | Trade accounts payable |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Suppliers | 1,240 | 1,453 | ||||||
Insurance agents | 839 | 321 | ||||||
Repairers | 51 | 109 | ||||||
Agents | 148 | 208 | ||||||
2,278 | 2,091 | |||||||
16 | Accrued expenses |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Masters’ accounts | 402 | 390 | ||||||
Other | 344 | 67 | ||||||
746 | 457 | |||||||
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
17 | Capital management |
18 | Contingencies |
19 | Related parties |
(a) | Enterprises Shipping and Trading SA (the “EST”): |
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
(b) | Constellation Energy Commodities Group Limited: |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Due from related parties — current | ||||||||
EST | 3,441 | 832 | ||||||
Constellation | — | 262 | ||||||
Due from shareholders | 15,000 | 15,000 | ||||||
18,441 | 16,094 | |||||||
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Due to related parties — current | ||||||||
Constellation | — | 59 | ||||||
— | 59 | |||||||
June 30, | June 30, | |||||||
2009 | 2008 | |||||||
Management fees | ||||||||
EST | (607 | ) | (742 | ) | ||||
Constellation | (116 | ) | (258 | ) | ||||
(723 | ) | (1,000 | ) | |||||
20 | Subsequent events |
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Notes to Condensed Consolidated Unaudited Interim Statements — (Continued)
June 30, 2009 and December 31, 2008
In thousands of U.S. dollars, except for shares, unless otherwise stated
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Table of Contents
Item 6. | Indemnification of Directors and Officers. |
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Item 7. | Recent Sales of Unregistered Securities. |
Number of | ||||
Shareholders | Shares(1) | |||
Georgios Koutsolioutsos | 2,100,000 | |||
Panagiotis Zafet | 1,250,000 | |||
Simon Zafet | 1,250,000 | |||
Alexios Komninos | 275,000 | |||
Ioannis Tsigkounakis | 125,000 |
(1) | All such numbers give retroactive effect to the surrender for cancellation of an aggregate 1,604,448 shares of common stock by our shareholders on February 20, 2007, as adjusted for a one and one-half-for-one stock split in the form of a stock dividend on July 6, 2007, and a one and one-third-for-one stock split in the form of a stock dividend on August 6, 2007. |
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Item 8. | Exhibits and Financial Statement Schedules. |
Exhibit | ||||
No. | Description | |||
3 | .1 | Form of Amended and Restated Articles of Incorporation(1) | ||
3 | .2 | Form of Amended and Restated By-laws(1) | ||
3 | .3 | Amendment to Amended and Restated Articles(2) | ||
4 | .1 | Specimen Common Stock Certificate(3) | ||
4 | .2 | Specimen Public Warrant Certificate(3) | ||
4 | .3 | Specimen Private Warrant Certificate(3) | ||
4 | .4 | Form of Warrant Agreement between Continental Stock Transfer & Trust Company and the Registrant(4) | ||
5 | .1 | Opinion of Reeder & Simpson, P.C., Marshall Islands counsel to the Registrant(5) | ||
8 | .1 | Opinion of Flott & Co. PC(5) | ||
10 | .1 | Master Agreement dated as May 20, 2008(1) | ||
10 | .2 | Amendment to Master Agreement dated July 25, 2008(1) | ||
10 | .3 | Memorandum of Agreement relating to the African Oryx dated May 20, 2008 between Seanergy Maritime Corp., as buyer, and Valdis Marine Corp., as seller, as amended(1) | ||
10 | .4 | Memorandum of Agreement relating to the African Zebra dated May 20, 2008 between Seanergy Maritime Corp., as buyer, and Goldie Navigation Ltd., as seller, as amended(1) | ||
10 | .5 | Memorandum of Agreement relating to the Domestic Trade Ministry Kouan Shipping Industry Co. Davakis G. (ex. Hull No. KA215) dated May 20, 2008 between Seanergy Maritime Corp., as buyer, and Kalistos Maritime S.A., as seller, as amended(1) | ||
10 | .6 | Memorandum of Agreement relating to the Domestic Trade Ministry Kouan Shipping Industry Co. Hull No. KA216 dated May 20, 2008 between Seanergy Maritime Corp., as buyer, and Kalithea Maritime S.A., as seller, as amended(1) | ||
10 | .7 | Memorandum of Agreement relating to the Bremen Max dated May 20, 2008 between Seanergy Maritime Corp., as buyer, and Pavey Services Ltd., as seller, as amended(1) | ||
10 | .8 | Memorandum of Agreement relating to the Hamburg Max dated May 20, 2008 between Seanergy Maritime Corp., as buyer, and Shoreline Universal Limited, as seller, as amended(1) | ||
10 | .9 | Management Agreement dated as of May 20, 2008(1) | ||
10 | .10 | Brokerage Agreement dated as of May 20, 2008(1) | ||
10 | .11 | Voting Agreement dated as of May 20, 2008(1) | ||
10 | .12 | Amendment to Voting Agreement dated July 25, 2008(1) | ||
10 | .13 | Second Amendment to Voting Agreement dated August 21, 2008(6) | ||
10 | .14 | Third Amendment to Voting Agreement dated August 27, 2008(7) | ||
10 | .15 | Fourth Amendment to Voting Agreement dated November 20, 2008(7) | ||
10 | .16 | Form of Convertible Unsecured Promissory Note(1) | ||
10 | .17 | Form of Plan of Dissolution and Liquidation(1) | ||
10 | .18 | Form of Stock Escrow Agreement(4) | ||
10 | .19 | Form of Joinder Agreement(3) | ||
10 | .20 | Share Purchase Agreement dated July 14, 2009 between registrant and Constellation Bulk Energy Holdings, Inc.(9) | ||
10 | .21 | Shareholders’ Agreement dated August 12, 2009 between Seanergy and Mineral Transport Holdings(10) | ||
10 | .22 | Amendment to Convertible Promissory Note dated August 28, 2009(10) |
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Exhibit | ||||
No. | Description | |||
10 | .23 | Loan Agreement dated August 27, 2008 between Seanergy and Marfin Bank of Greece, S.A.(10) | ||
10 | .24 | Amendment No. 1 to Loan Agreement dated September 9, 2009(10) | ||
10 | .25 | Second Supplement Agreement dated September 30, 2009 relating to and including the Loan Agreement dated June 26, 2007 between BET and Citibank, as amended and supplemented by a supplemental agreement dated October 16, 2007 and a supplemental letter dated July 10, 2008 and as further amended and restated by a supplemental agreement dated September 30, 2009.(10) | ||
10 | .26 | Amendment No. 2 to Loan Agreement dated November 13, 2009(9) | ||
16 | .1 | Letter From KPMG Certified Auditors AE dated September 17, 2009, addressed to the SEC provided in connection with change in independent registered public accountants(8) | ||
23 | .1 | Consent of Weinberg & Company, P.A.(9) | ||
23 | .2 | Consents of KPMG Certified Auditors AE(9) | ||
23 | .3 | Consent of Reeder & Simpson, P.C., Marshall Islands counsel to the Registrant (included in Exhibit 5.1)(5) | ||
23 | .4 | Consent of Clarkson Research Services Limited(10) | ||
23 | .5 | Consent of Flott & Co. PC (included in Exhibit 8.1)(5) | ||
24 | Power of Attorney(8) |
(1) | Incorporated by reference to the corresponding agreement in the Annex filed with Seanergy Maritime’s proxy statement onForm 6-K filed with the SEC on July 31, 2008. | |
(2) | Incorporated by reference to the corresponding agreement in the Exhibit filed with SeanergyForm F-1 filed with the SEC on August 28, 2009. | |
(3) | Incorporated by reference to the corresponding agreement in the Exhibit filed with Seanergy’sForm F-1 filed with the SEC on January 15, 2009. | |
(4) | Incorporated by reference to the corresponding agreement in the Exhibit filed with Seanergy Maritime’sForm F-1 filed with the SEC on July 10, 2007. |
(5) | Originally filed with Amendment No. 2 to this Registration Statement on Form F-1. |
(6) | Incorporated by reference to the corresponding agreement in the Annex filed with Seanergy Maritime’s supplemental proxy statement onForm 6-K filed with the SEC on August 22, 2008. | |
(7) | Incorporated by reference to the corresponding agreement in the Exhibit filed with Seanergy’sForm F-1 filed with the SEC on December 12, 2008. | |
(8) | Originally filed with this Registration Statement on Form F-1. |
(9) | Filed herewith. |
(10) | Originally filed with Amendment No. 1 to this Registration Statement on Form F-1. |
Item 9. | Undertakings. |
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By: | /s/ Dale Ploughman |
Signatures | Title | Date | ||||
* Georgios Koutsolioutsos | Chairman of the Board of Directors | November 18, 2009 | ||||
/s/ Dale Ploughman Dale Ploughman | Chief Executive Officer and Director (Principal executive officer) | November 18, 2009 | ||||
/s/ Christina Anagnostara Christina Anagnostara | Chief Financial Officer and Director (Principal financial and accounting officer) | November 18, 2009 | ||||
* Ioannis Tsigkounakis | Secretary and Director | November 18, 2009 | ||||
* Alexios Komninos | Director | November 18, 2009 | ||||
* Kostas Koutsoubelis | Director | November 18, 2009 | ||||
* Dimitris Anagnostopoulos | Director | November 18, 2009 | ||||
* Elias M. Culucundis | Director | November 18, 2009 | ||||
* George Taniskidis | Director | November 18, 2009 | ||||
* Kyriakos Dermatis | Director | November 18, 2009 |
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Signatures | Title | Date | ||||
* Alexander Papageorgiou | Director | November 18, 2009 | ||||
* Dimitrios Panagiotopoulos | Director | November 18, 2009 | ||||
* George Tsimpis | Director | November 18, 2009 | ||||
*By: | /s/ Dale Ploughman Attorney-in-Fact |
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