[Cancelled] China Eximbank contributes $17.3 million USD to Tranche C of loan for acquisition of DY6006 shipping vessel (Linked to Project ID#62794 and #62845)

On January 7, 2016, China Eximbank signed a $75,734,900 USD loan agreement with Aster Shipping Company Inc., Aerik Shipping Company Inc., and Houk Shipping Company Inc — special purpose vehicles legally incorporated under the laws of Marshall Islands and wholly owned subsidiaries of shipping company Diana Shipping Inc. — to finance the purchase of three vessels made by Chinese shipbuilding companies. These vessels include: H2548 (Vessel A) and H2549 (Vessel B) from Jiangnan Shipyard (Group) Co., Ltd and DY6006 (Vessel C) from Yangzhou Dayang Shipbuilding Co., Ltd. The loan is divided into three tranches: tranche A, $29,220,000 USD (captured via Project ID# 62794); tranche B, $29,220,000 USD (captured via Project ID#62845); and tranche C, $17,294,900 USD (captured via Project ID#62844), corresponding to Vessel A, Vessel B, and Vessel C, respectively. On May 17, 2013, Jiangnan Shipyard (Group) Co., Ltd. entered into a building contract for Vessel A (H2548). The loan carries an interest rate of LIBOR plus a 2.3% margin. The first installment falls due on whichever of 21 January, 21 April, 21 July, or 21 October that next falls not less than six weeks after the Drawdown Date in respect of that Tranche. All tranches are repayable no later than March 12, 2032. The borrower is responsible for paying China Eximbank a commitment fee computed at the rate of 0.2% per annum on the undrawn commitment from time to time from the date of the Agreement until the last Availability Termination Date, as well as $378,674.50 USD as an arrangement fee. On January 4, 2017, the Diana Shipping company took delivery of Hulls H2548, named San Francisco, and H2549, named Newport News, and drew down $28,620,000 USD for each vessel under its loan agreement with China Eximbank. However, In October 2016, the Diana Shipping company canceled its shipbuilding contract for DY6006 (Vessel C). As such, tranche C was also canceled as of October 31, 2016. Then, on February 6, 2017, the Diana Shipping company signed with China Eximbank a Deed of Release, pursuant to which, the owner of Hull DY6006 was released from all of its obligations under the loan agreement as a borrower as a result of the cancellation of its shipbuilding contract with the yards.

Additional details

1. AidData has estimated the all-in interest rate (3.156%) by adding 2.3% to average 6-month LIBOR in January 2016 (0.856%). 2. The China Eximbank loan agreement can be accessed in its entirety via https://www.sec.gov/Archives/edgar/data/1318885/000091957416012194/d7078189_ex4-25.htm.

Number of official sources

2

Number of total sources

2