China Eximbank contributes $12 million to Tranche A of $30 million syndicated loan for acquisition of Crystalia shipping vessel (Linked to Project ID#63377)

On May 24, 2013, China Eximbank and DNB BANK ASA signed a $30,000,000 syndicated loan agreement with Erikub Shipping Company Inc. (‘Erikub’) and Wotho Shipping Company Inc. (‘Wotho’) — two special purpose vehicles that are legally incorporated in the Republic of the Marshall Islands and wholly-owned subsidiaries of Diana Shipping Inc. (a shipping company) — to finance the acquisition costs of two vessels. The vessels were: H2528 to be named Crystalia (the Erikub vessel) and H2529 to be named Atalandi (the Wotho vessel). In total, China Eximbank contributed $24,000,000 and DnB committed $6,000,000 to the loan syndicate. The loan was made available in two tranches: a $15,000,000 tranche known as Tranche A and a $15,000,000 tranche known as Tranche B. China Eximbank agreed to contribute 80% of the funding for Tranche A and Tranche B, while DNB BANK ASA agreed to contribute 20% of the funding for Tranche A and Tranche B. Project ID#63376 captures China Eximbank’s $12 million contribution to Tranche A for the Erikub vessel, Crystalia. Project ID#63377 captures China Eximbank’s $12 million contribution to Tranche B for the Wotho vessel, Atalandi. The borrower was expected to use the loan proceeds to partially finance two, $29,000,000 shipbuilding contracts between China Shipbuilding Trading Company Limited and Jiangnan Shipyard (Group) Co. Ltd. and the borrowing institutions (Erikub and Wotho), which were signed on May 28, 2012. The loan bore interest at LIBOR (0.421%, 2013 6-month USD LIBOR rate in May 2013) plus a margin of 3.0% per annum, summed at 3.421%. Each advance on the loan was repayable in 19 quarterly installments ($250,000 each) and a balloon payment of $10,250,000, which was payable together with the last installment due on February 22, 2019. The first installment of repayment was due three months after the drawdown date. The loan was secured by (i.e. collateralized against) first preferred or statutory (as the case may be) cross-collateralized mortgages over the vessels together with collateral deeds of covenants (if applicable); first priority deeds of assignment of the insurances, earnings and requisition compensation of the vessels; first priority deeds of charge over earnings accounts and all amounts from time to time standing to the credit of the earnings accounts; a first priority deed of charge over the Master Agreement Benefits; and letters of undertaking and subordination (including an assignment of Insurances) in respect of the Vessels from the Managers. The loan had achieved a 100% disbursement rate as of May 22, 2014, and it was repaid in full in February 2019. The Crystalia was delivered on February 20, 2014. The Atalandi was delivered on May 12, 2014. The Crystalia and Atalandi vessels are ice-class Panamax dry bulk carriers. The originally scheduled delivery dates for the Crystalia and Atalandi were October 31, 2013 and December 31, 2013, respectively.

Additional details

1. The loan agreement can be accessed in its entirety via https://www.sec.gov/Archives/edgar/data/1318885/000091957414002437/d1464807_ex4-18.htm.

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