TBS International Reaches Agreement With Banks on Continued Payment Deferral
15 November 2010 - 2:30PM
Marketwired
TBS International plc (NASDAQ: TBSI) announced today that its
various lender groups have agreed to continue to forbear, during
the period from November 15, 2010 through December 29, 2010, from
exercising their rights and remedies which arise from the Company's
failure to make principal payments when due. The Company will not
make principal payments due on its financing facilities during the
extended forbearance period, but it will continue to pay interest
on those facilities at the default interest rate. The Company and
its lenders continue to negotiate amendments to its various
financing facilities that will change the current payment schedules
and cure any existing defaults, and TBS believes that appropriate
amendments to its various financing facilities will be executed
prior to the expiration of the deferral.
The new forbearance agreements replace the Company's minimum
cash liquidity covenant during the forbearance period, providing
that the Company's cash balance as of the last business day of any
week or averaged weekly cash balance must not fall below $15.0
million. Each lender who consented to the forbearance agreements
will receive a consent fee equal to 0.05% of its total outstanding
loan amount.
Forward-Looking Statements "Safe Harbor"
Statement under the Private Securities Litigation Reform Act of
1995
This press release contains forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are
based on management's current expectations and observations.
Included among the factors that, in the Company's view, could
cause actual results to differ materially from the forward looking
statements contained in this press release are the following:
- the Company's ability to reach agreements with its lenders to
amend its credit facilities and its ability to obtain waivers of,
or cure, defaults under its credit facilities;
- the Company's ability to maintain financial ratios and comply
with the financial covenants required by its credit facilities as
amended;
- the Company's ability to finance its operations and raise
additional capital on commercially reasonable terms or at all;
- changes in demand for and pricing of the Company's services,
both of which are difficult to predict due to continuing economic
uncertainty;
- the effect of a decline in vessel valuations;
- changes in rules and regulations applicable to the shipping
industry, including legislation adopted by international
organizations such as the International Maritime Organization and
the European Union or by individual countries;
- actions taken by regulatory authorities;
- changes in trading patterns, which may significantly affect
overall vessel tonnage requirements;
- changes in the typical seasonal variations in charter
rates;
- volatility in costs, including changes in production of or
demand for oil and petroleum products, crew wages, insurance,
provisions, repairs and maintenance, generally or in particular
regions;
- additional material declines or continued weakness in shipping
rates;
- changes in general domestic and international political
conditions;
- changes in the condition of the Company's vessels or applicable
maintenance or regulatory standards which may affect, among other
things, the Company's anticipated drydocking or maintenance and
repair costs;
- increases in the cost of the Company's drydocking program or
delays in its anticipated drydocking schedule;
- China Communications Construction Company Ltd./Nantong Yahua
Shipbuilding Group Co., Ltd.'s ability to complete and deliver the
remaining multipurpose tweendeckers on the anticipated schedule and
the ability of the parties to satisfy the conditions in the
shipbuilding agreements;
- the possible effects of pending and future legislation in the
United States that may limit or eliminate potential U.S. tax
benefits resulting from the Company's jurisdiction of
incorporation;
- Irish corporate governance and regulatory requirements which
could prove different or more challenging than currently expected;
and
- other factors that are described in the "Risk Factors" sections
of the Company's reports filed with the Securities and Exchange
Commission.
About TBS International plc: TBS is a
fully-integrated transportation service company that provides
worldwide shipping solutions to a diverse client base of industrial
shippers. Through the TBS Five Star Service consisting of ocean
transportation, operations, logistics, port services, and strategic
planning, TBS offers total project coordination and door-to-door
supply chain management. The TBS shipping network operates liner,
parcel and dry bulk services, supported by a fleet of multipurpose
tweendeckers and handysize and handymax bulk carriers, including
specialized heavy-lift vessels and newbuild tonnage. TBS has
developed its business around key trade routes between Latin
America and China, Japan and South Korea, as well as select ports
in North America, Africa, the Caribbean and the Middle East. Visit
our website at www.tbsship.com
For more information, please contact: Company Contact: Ferdinand
V. Lepere Senior Executive Vice President and Chief Financial
Officer TBS International plc Tel. 914-961-1000
InvestorRequest@tbsship.com Investor Relations / Media: Nicolas
Bornozis Capital Link, Inc. New York Tel. 212-661-7566 E-mail:
tbs@capitallink.com
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