GENER8 MARITIME,INC. (NYSE:GNRT) Files An 8-K Entry into a Material Definitive AgreementItem 1.01 Entry into a Material Definitive Agreement.
On September26, 2017 Gener8 Maritime Subsidiary Inc. (formerly Navig8 Crude Tankers Inc., the “Company”), a wholly-owned subsidiary of Gener8 Maritime,Inc., entered into (i)an amendment agreement (the “Amendment Agreement”) with HHIC-Phil Inc. (the “Builder”) related to the shipbuilding contract dated March25, 2014 between the Company and the Builder (the “Building Contract”) in relation to the construction by the Builder and the purchase by the Company of the 300,000 dwt very large crude carrier with Builder’s Hull No.NTP0138 to be named “Gener8 Nestor” (the “Vessel”) and (ii)an outstanding works agreement (the “Outstanding Works Agreement”) between the Company and the Builder. Under the Amendment Agreement and the Outstanding Works Agreement, the Builder is obligated to physically deliver the Vessel to the Company on October9, 2017 and, notwithstanding delivery of the Vessel, complete any outstanding works relating to the Vessel required to meet the specifications and requirements of the Building Contract.
The Amendment Agreement further provides for a $19.3 million reduction in the contract price payable under the Building Contract for the Vessel, including $5.4 million in liquidated damages due to the Company under the Building Contract relating to the late delivery of the Vessel by the Builder based on the delivery schedule set forth in the Building Contract. As a result, the contract price for the Vessel has, in effect, been reduced from $96.4 million to $77.1 million, and the final installment due from the Company upon delivery of the Vessel by the Builder on October 9, 2017 will be reduced from $48.2 million to $29.0 million
The Outstanding Works Agreement provides that the Builder is obligated to pay additional liquidated damages at the rate of $30,000 per day for the period from October9, 2017 to the date of actual completion of the outstanding works. If the outstanding works are not completed on or before October23, 2017, the Company has the option to complete the works on its own or using its own subcontractors at the Builder’s cost and liquidated damages will continue to be payable by the Builder during that time at the rate of $30,000 per day.