UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 9, 2016

Eagle Bulk Shipping Inc.

(Exact name of registrant as specified in its charter) 

477 Madison Avenue
New York, New York 10022

(Address of principal executive offices, including zip code)

(212) 785-2500

(Registrant's telephone number, including area code)

(Former Name or Former Address, if Changed Since Last Report): None

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

As previously reported in its Current Report on Form 8-K filed with the Securities and Exchange Commission on January 19, 2016 (the “January Form 8-K”), Eagle Bulk Shipping Inc. (the “Company”) entered into a Forbearance and Standstill Agreement (the “Forbearance Agreement”) by and among the Company, certain subsidiaries of the Company party to the Loan Agreement (as defined below) as guarantors (the “Guarantors”) and each lender under the Loan Agreement executing the Forbearance Agreement, which constitute the Majority Lenders (as defined in the Loan Agreement) (the “Specified Lenders”). The Company, the Guarantors, the Specified Lenders and the other banks and financial institutions party to the loan agreement as lenders (the “Lenders”), ABN AMRO Capital USA LLC, as agent for the Lenders and security trustee (the “Agent and Security Trustee”), are party to that certain Loan Agreement, dated as of October 9, 2014, and as amended by an Amendatory Agreement dated as of August 14, 2015 (as so amended and as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”).

On February 9, 2016, the Company, the Guarantors, the Specified Lenders and the Agent and Security Trustee entered into Limited Waiver to the Loan Agreement and Amendment No. 2 to Forbearance and Standstill Agreement (“Amendment No. 2”). As a condition to the effectiveness of Amendment No. 2, the Company made the quarterly payment installment to the Lenders that was due on January 15, 2016 in the amount of $3,906,250, which payment served to cure the related event of default under the Loan Agreement.

Pursuant to Amendment No. 2, the parties agreed to extend the Forbearance Period (as defined in the Forbearance Agreement and as described in the January Form 8-K, and as further amended by Amendment No. 1 to Forbearance and Standstill Agreement, dated as of February 1, 2016 (“Amendment No. 1”), and described in the Company’s Current Report on Form 8-K filed on February 2, 2016), which was extended under Amendment No. 1 to expire at 6:00 a.m. (New York City time) on February 9, 2016. As amended by Amendment No. 2, the Forbearance Period will be further extended and end at 6:00 a.m. (New York City time) on February 23, 2016, or on the earlier date of any of the following, as set forth in the Forbearance Agreement: (1) the occurrence of any event of default under the Loan Agreement other than a Specified Default (as defined in the Forbearance Agreement and as described in the January Form 8-K); (2) the failure by the Company and the Guarantors to comply with the covenants set forth in the Forbearance Agreement, which failure continues for more than two business days after written notice from the Specified Lenders or the Agent; or (3) the failure of the representations and warranties made by the Company and the Guarantors set forth in the Forbearance Agreement to be true and correct in any material respect as of the date made.

In addition, the Agent on behalf of the Majority Lenders, and the Agent and the Security Trustee, each in its individual capacity, agreed under Amendment No. 2 to waive the minimum liquidity covenant set forth in Clause 12.4 of the Loan Agreement until the earlier of (1) the occurrence of the Termination Date (as defined in the Forbearance Agreement) and (2) the Company’s failure, at any time, to maintain liquidity of not less than the greater of (a) $14,187,500 and (b) $322,443 per ship owned by each of the Guarantors (the “Temporary Minimum Liquidity”), so long as (i) at least 61.23% of the Temporary Minimum Liquidity consists of cash, other than any Interest Coverage Cure Amount (as defined in the Loan Agreement) and (ii) not more than 38.77% of the Temporary Minimum Liquidity is in the form of cash equivalents or undrawn credit lines of one or more of the Company or the Guarantors, in each case, with remaining maturity of at least one year (excluding the revolving credit facility under the Loan Agreement).

The Company, the Guarantors and the Specified Lenders entered into the Forbearance Agreement, Amendment No. 1 and Amendment No. 2 to provide the Company with time to evaluate potential financing alternatives to enhance its liquidity, with the objective of reaching agreement by the end of the Forbearance Period. The extension of the Forbearance Period and the amendment to the minimum liquidity covenant is intended to provide the Company with additional time and liquidity while discussions with certain of its shareholders and Lenders with respect to such financing alternatives are continuing; however, there can be no assurance that the Company will reach any agreement with any of its shareholders or Lenders to structure any potential financing by the end of the extended Forbearance Period, if at all, or that the Forbearance Agreement or Forbearance Period will be further extended.

The foregoing description of Amendment No. 2 does not purport to be complete and is subject to, and qualified, in its entirety by, the full text of Amendment No. 2 , which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference herein.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. 

EXHIBIT INDEX