Rainwater capture has only been legal in CA since 2012. See:
Come now, Audio. We've been told repeatedly that this sort of thing does not happen... that lenders are obligated to give and / or extend "waivers".
Surely you must have misread the article(s). Surely WSJ must have gotten their information wrong.
Interesting that Oaktree left the tankers under Torm's control, rather than consolidating them with the Genmar/Atlantic fleet it acquired when GMR BK'ed.
"The process is not any different than any collateralized loan.."
Default on your car loan. Leave the vehicle on the street. And watch what happens. The lender has ZERO obligation to petition the court. NONE. Look it up.
It is the case that, with a ship, it's likely that the lender will obtain a court order "arresting" the ship that can be presented to a harbor master (to avoid conflict).
But as Audio points out, that only takes a few minutes. All the lender has to prove is that a default has occurred and that they have a security interest in the asset.
The "best interest of ALL involved" is completely nonsense. Again... default on your car loan and watch what happens.
"The debt holders (bank, hedge,etc) do NOT OWN the ships. They own the debt."
The ships are collateral on the loan. If EGLE defaults, the lender CAN seize the ships.
If you're keeping up with shipping news, you know that this has already happened in a number of cases (google NEWLEAD BULKERS SEIZED if you need an example).
EGLE isn't yet in default. But IF it misses payments, the lenders CAN take the ships.
Did you read the proxy, Lake? NCPPR was the organization that sponsored the proposal that would require disclosure of trade associations and "sustainability" costs. It is what the "nut from NCPPR" was referring to.
The issue isn't just about solar panels. That is just the tip of the iceberg.
And since you know from earlier message exchanges that I personally contract for 100% renewable (wind) energy, you know that this stuff actually matters to me.
Read the proxy Lake. While solar is a "poster child" for sustainability debates, solar/climate change is not the whole of the issue by a long shot, particularly when one is taking about the sorts of rare earths and heavy metals that end up in APPL products.
Here an excerpt of the relevant language from the Proxy. You'll note that there is no mention of solar.
PROPOSAL NO. 9
Shareholder Proposal Entitled Report on Company Membership and Involvement with Certain Trade
Associations and Business Organizations
Shareholders of Apple, [sic] Inc. (“Apple”) urge the board of directors (the “board”) to authorize the preparation of a report, updated annually, disclosing:
1. Apple’s membership in any trade association or organization that educates members about sustainability practices, assists members in the development of sustainability practices, encourages members to engage in sustainability practices or requires members to undertake sustainability actions.
Some trade associations and business organizations have expanded beyond the promotion of traditional business goals and are lobbying business executives to pursue objectives with primarily social benefits. This may affect Company profitability and shareholder value. The Company’s involvement and acquiescence in these endeavors lacks transparency, and publicly-available information about the Company’s trade association memberships and related activities is minimal. An annual report to shareholders will help protect shareholder value.”
I finally put that clown on ignore. The incessant self-promoting and audio-stalking was cluttering up a couple of the boards I watch.
It wasn't about climate change.
Cook attempted to sidestep answering a question about the cost of APPL's environmental sustainability - which is not the same issue as climate change. When the questioner pressed him further on the bottom-line aspects of what APPL is doing Cook told him that if the only thing the investor was concerned about was ROI then he should get out of the stock.
Given that the title of the CNN article mis-represented the substance of the question, I can understand how you got it wrong as well.
"they decided to answer that with more name calling, how mature is that and here you are defending them and complaining about me."
Where was the defense of them? I merely pointed out that your response was anything but the "grown up" attitude that you claim to have arrived at.
" Audiophul is an angry guy who makes poor decisions and takes it out on others.."
An angry guy? Yes. He even admits to that. He's fed up with the newbies that show up with their posts of how company "x" is going to be a 4 bagger, with no support for their position, and then proceed to try and litter the boards with "shout downs" in response to anyone who has the temerity to disagree with them on the facts.
"he's bashing the pumpers because he made a poor decision to buy NEWL and is losing money.. now he's blaming others instead of himself.. this is who you are defending semper."
As I read it, his recent "bashing" of the pumpers was tongue-in-cheek... a tease. As for whether his buy decision was a poor one, time will tell.
"I know everything that I need to know in order to buy shares in one of these companies and yes I do look up info on the internet from credible sources..."
And yet you seem not to know about the debt / financial arrangements of EGLE, GNK, et. al. that are disclosed in their SEC filings?
"He's an amateur that thinks he's an expert.. the decision to buy NEWL was highly amateurish whether he makes or loses money (he's down 30% by the way). He paid too much for DRYS too"
A is, indeed, an amateur - like the rest of us. Yet he is as close to an expert as you're likely to find on these board.
Whether he "paid too much" is yet to be determined. By definition, anyone who doesn't buy EXACTLY at the low point "paid too much". Very few of us can time the precise bottom. So MOST of us end up "paying too much".
"I've since grown up..."
Your continual verbal diarrhea is doing nothing to support your assertion that you've "grown up". You come across as just another 12 year old with an attitude.
"...your posts and that gives anyone the opportunity to discredit you, as I have done several times now."
Actually, they don't, and you didn#$%$ your continual misreading of his intent re: his trades that is leading you astray.
As for your pontification on scrapping, ship availability,etc. you should consult with Audio. He's as close to an encyclopedia on shipping related matters as frequents these boards (just ask him about port infrastructure, main engines, etc). He can explain why, in great detail, your presumptions are incorrect.
He's always willing to share his knowledge with those who ask politely.
Yawn. Still trying to BS your way through this?
GNK was granted a limited waiver - applying ONLY to the event of the non-payment of interest on the 2015 convertible, and is effective ONLY during the "grace period" of the 2015 convertible (GNK will not be in default on the unpaid 2015 interest until the grace period expires). The waiver expires on the earlier of March 21 or when GNK violates another of its loan covenants.
GNK, while it has not been making principal payments on its debt, has, at least up until now, been able to make the interest payments on its debt. Which is better than EGLE.
Not only has EGLE not been making principal payments on its debt, it has not been making *interest payments* either; it's been capitalizing the interest, not paying it.
It's hard to claim that EGLE is in better shape than GNK when the latter has been able to pay interest and the former has not.
The only thing that EGLE has going for it is that the violation of its loan covenants will occur 12 months later than GNK's violation. Financially, it is in no better shape than GNK.
What was inaccurate in the statement?
"They owe the banks more than the ships are worth"
That is a true statement.
" debt is all due and payable this year"
Also a true statement.
"You fixated on things that seem to be meaningless.. "
Fixated? Not hardly. P/E is simply one of a series of benchmarks for evaluating pps.
"did you answer why DSX and PRGN are trading so high when they are losing money?"
You didn't ask the question. DSX and PRGN are financially stable enough to do what EGLE and GNK cannot... take advantage of the current market weakness by issuing secondaries and / or taking on additional debt.
"GLOG has a P/E of 36..."
You're looking in the rear-view mirror. GLOG is actually trading at a **forward** PE of 17... which is at the low end of range for comparable stocks - GLNG, TGP, et. al.
That was a good trade. Congrats.
"I don't follow GNK or FREE but since you short those companies"
I have no short positions at present. Have never shorted either GNK or FREE.
"You keep saying EGLE hasn't been paying debt.. That's a complete falsehood."
You need to look at the balance sheet and read the 10-Q. Not only has EGLE **not** been paying loan principal, it has **not** been paying interest on its debt; it has been capitalizing the unpaid interest. That is what is represented by the "PIK" loans that appear on the balance sheet.
"EGLE is in much better shape."
Given that GNK was at least able to pay the interest on its debt where EGLE is not, your assumption is suspect.
"Which shipper has a multiple of 7 "
For someone who purports to be knowledgeable of shippers, you seem woefully ill informed. Pull up S&P reports for all the bulkers you can think of and review historical PEs. You're in for a surprise.
"Where is this information publicly available? "
Th quotes are from the 10-K and 10-Qs that are filed with the SEC. Those are publicly available and can be accessed from GNK's website.
"Same goes for what you just said about FREE..."
Google news reports. That's what I did (because I don't follow FREE)..
"no lendor wants a GNK bankruptcy when light at the end of the tunnel for a company like GNK is near."
That depends on the lender. If you're Oaktree, and you've already taken GMR into bankruptcy, you would have no objection to doing the same with GNK and then adding its ships to your growing fleet. The idea that the banks will grant waivers forever is beyond silly.
"EGLE rises fast this year to $8 and dilutes to get that debt in order. Shareholders will get dinged with a loss in share price for about a few weeks and then the share price recovers as it does with all the other shippers."
"EGLE has a very good chance of not only managing the debt but also becoming highly profitable in 2015-16."
The numbers aren't in your favor on this. Forget loan principal repayments, EGLE isn't throwing off enough cash to pay the INTEREST on its debt. The company needs to cut its debt load in half. That means raising apx $550m in equity. You're blowing smoke with $8 a share. EGLE would be lucky to get $6 a share in a secondary. Assuming they could get that price, they would need to issue roughly 91 MILLION new shares vs. the approximate 17 million currently outstanding. But assuming they COULD place that many shares, and COULD get back to earnings level of 2007 etc. that would mean eps of apx .30 a share. At a normal shipper multiple of 7, that's a share price of 2.10. So... besides yourself, who would pay $6 for a stock that is worth maybe $3?
And don't forget. If the bulk market becomes as ridiculously profitable as you surmise that orders for new ships will rocket (again). Twelve months out, TCEs will crater again.
Good luck with your "investment" thesis.
From the 2012 10-K:
" With the exception of the collateral maintenance financial covenant and the net debt to EBITDA covenant, compliance with which was waived by the lenders through December 31, 2013 under the August 2012 Agreements (defined below), we believe that we are in compliance with our covenants under the 2007 Credit Facility. Without a waiver of the kind provided in the 2009 Amendment, a decrease in the fair market value of our vessels may cause us to breach one or more of the covenants in our 2007 Credit Facility, which could accelerate the repayment of outstanding borrowings under the facility."
From the 1st quarter 2013 10-Q:
"...the Company is required to assess future compliance with the original covenants at all quarterly measurement dates within twelve months from March 31, 2013. As discussed above, the Company believes it is probable that the Company will not be in compliance with certain covenants at measurement dates within twelve months of March 31, 2013. Accordingly, the outstanding debt as of March 31, 2013 under the 2007 Credit Facility, the $253 Million Term Loan Facility and the $100 Million Term Loan Facility (as defined in Note 9 — Debt) has been reclassified as a current liability in the condensed consolidated balance sheet as of March 31, 2013.."
The above is essentially repeated in the Q2 and Q3 reports.
The actions of this week - the non-payment of the 2015 convertible interest and the waiver needed to avoid default under other loan provisions - suggest that there is no material change in GNK's covenant compliance.
"The evidence is that the lenders did not seize GNK's ships in whichever port they happen to be in when and if the lenders had not granted waivers."
You seem to be confused on a few points.
The issue was a loan **covenant** violation. There was no **default**. These are very different things.
The consequence of the covenant violation was that the long term loan converted to short term; the entire principal became payable within 12 months. The lender did NOT grant a waiver of the covenant when the violation occurred; that is why GNK's debt became a short term obligation.
That covenant violation did NOT constitute a default. The Lenders did not obtain an immediately enforceable lien on the ships as a consequence of the covenant violation. There was no legal basis for the lenders to arrest any of GNK's ships.
All of that occurred last year.
As you know, GNK this week missed the 2/18/14 interest payment on its 2015 convertible. But even THAT is not **yet** a default with respect to the provisions of the convertible. GNK has a 30 day grace period before it is in technical default on that payment.
However, the missed payment created a technical default on one of its **other** loans. It was the provision of that loan for which GNK obtained a waiver. The waiver expires NO LATER than March 21, 2014.
The situation with FREE was completely different. A creditor obtained a court order enforcing a lien - presumably for non-payment of some sort.
"I don't see any other evidence to contradict that."
Well... if you don't accept the conversion of LT debt to ST debt, in accordance with the loan terms, as evidence of the absence of a waiver of the term violation... there isn't much more to say. It can't be any MORE evident that GNK was NOT granted a waiver.
" Semper, you and I know that the only reason any of these companies are going under is because they have been operating in a terrible market."
You're missing a key point. NM, DSX, SB, and others operate in the SAME market as EXM, GNK, EGLE, but don't have anywhere near the problems. These latter firms were screwed by their management's decisions to gorge on fancy new ships at the peak of the market. It's not a "seasonal" thing.
"You tried the same tactics in the December and got burned"
Burned? not me.
"I would bet that EGLE does a stock offering Like PRGN's"
These two companies are in entirely different places. An offering by EGLE would not be "like" that of PRGN. EGLE can't make the interest payment on its existing debt while PRGN can be thinking of fleet expansion.
"wake up semper, the good market is this year"
No, the good market was in '05. That's when GNK and others were 10 baggers. The firms that caught up in the euphoria of the time - EXM, GNK, EGLE, et al. - are now "on the ropes" financially. The firms that were more "measured" in their decisions during the bubble years - NM, DSX, et. al. - have been able to take advantage of their competitor's weakness.
"I refuse to comment anymore on your BS semper unless you back it up with a source.. where is the news release that says GNK did not receive a waiver.."
Come on Sleeping, wake up and THINK!!!
The fact that GNK's long term debt converted to short term is EVIDENCE that they did not receive a waiver when the violated covenants last year. Had there been a waiver, the debt would NOT have converted to ST.
"GNK's debt situation is probably the worst because the debt is payable in the short term."
And it was LONG TERM debt UNTIL the covenant violation last year. At which time the entire amount of the $1.4b became payable within 12 months.
"They will likely get waivers to sell a few ships."
They need $1.4 BILLION. Selling a few ships, even IF the lenders agreed to release the loan collateral, doesn't achieve anything useful.
" SHIP got waivers today"
Waiver? You think the lender taking the ships constitutes a waiver?
"EGLE has even more time..."
Yes, they have some time. But time doesn't repay debts. EGLE doesn't have a polar bear's chance in global warming of coming up with the cash needed to repay the debt. They have to restructure. There is NO choice. None. Nada. The ONLY question is about what the restructure will involve.