Navios Maritime Acquisition Corporation, an owner and operator of tanker vessels, announced that Navios Acquisition entered into a secured loan agreement with a subsidiary of N Shipmanagement Acquisition Corp. (“Lender”), an entity affiliated with Navios Acquisition’s Chairman and Chief Executive Officer, for a loan of up to $100.0 million to be used for general corporate purposes (the “Loan”).
The Loan has a term of two years, scheduled amortization and bears interest at a rate of 11% per annum, payable quarterly. The Borrower may elect to defer all scheduled amortization and interest payments, in which case the applicable interest rate is 12.5% per annum.
The Loan provides the Lender with an option, exercisable commencing in August 2021, to acquire partnership interests of Navios Maritime Midstream Partners L.P (“Midstream”), the Borrower’s unrestricted subsidiary, by exchanging any portion of amounts outstanding under the Loan for Midstream equity. The exchange rate will be determined based on Midstream’s gross asset value less the amount of Midstream’s indebtedness.
Collateral for the Loan consists of:
(i) a first priority pledge of the partnership interests of Midstream, which owns 25 tanker vessels (ten LR1 tankers, 14 MR2 tankers and one MR1 tankers);
(ii) a first priority pledge of the equity interests in two entities that hold the rights to the bareboat charter-in contracts for two of the Borrower’s VLCC vessels; and
(iii) a first priority pledge of the $67.4 million in aggregate principal amount of Navios Acquisition’s First Priority Ship Mortgage Notes due 2021.
Navios Acquisition has drawn $18.0 million under the Loan.
Special Committee
Navios Acquisition’s Board of Directors formed a Special Committee of independent and disinterested directors to evaluate the Loan. The Special Committee, with the assistance of its independent financial and legal advisors, exclusively negotiated the terms of the Loan.
