Note 2 - Corporate Reorganization	12 Months Ended
Dec. 31, 2016
Notes to Financial Statements
Corporate Reorganization [Text Block]	Note 2. Corporate Reorganization : Corporate Reorganization On March 30, 2016, we entered into the contribution agreement (the “Contribution Agreement”) with a newly-formed wholly-owned subsidiary, Eagle Shipping LLC, a limited liability company organized under the laws of the Marshall Islands and a wholly-owned subsidiary of the Company (“Eagle Shipping”), pursuant to which the Company transferred, assigned and contributed to Eagle Shipping, and Eagle Shipping received, accepted and assumed, all of the tangible and intangible assets of the Company (other than the membership interests in Eagle Shipping owned by the Company and certain deposit accounts held by the Company, which deposit account balances were transferred) and all of the liabilities of the Company, including all of the Company’s rights and obligations under the senior secured credit facility dated as of October 9, 2014 (the “Exit Financing Facility”) (the “Contribution”). Immediately following the Contribution, Eagle Shipping became the direct parent company of each of the Company’s previously directly-owned subsidiaries and the indirect parent company of each of the Company’s previously indirectly-owned subsidiaries. The Contribution was part of a series of transactions contemplated by the agreements also entered into on March 30, 2016 and described below, which transactions were consummated on March 30, 2016, after the fulfillment of certain conditions precedent. First Lien Facility On March 30, 2016, Eagle Shipping, as borrower, and certain of its subsidiaries that were guarantors of the Company’s obligations under the Company’s senior secured credit facility (the “Exit Financing Facility”) , as guarantors, entered into an Amended and Restated First Lien Loan Agreement (the “A&R First Lien Loan Agreement”) with the lenders thereunder (the “First Lien Lenders”) and ABN AMRO Capital USA LLC, as agent and security trustee for the lenders. The A&R First Lien Loan Agreement amended and restated the Exit Financing Facility in its entirety, providing for Eagle Shipping to be the borrower in the place of the Company, and further provided for a waiver of any and all events of default occurring as a result of the voluntary OFAC Disclosure (as defined below under Note 11 “Commitments and Contingencies - Legal Proceedings”). The A&R First Lien Loan Agreement provides for a term loan which was outstanding as of March 30, 2016, in the amount of $201,468,750 after giving effect to the entry into the A&R First Lien Loan Agreement and the Second Lien Loan Agreement (as defined below) as well as a $50,000,000 revolving credit facility, of which $10,000,000 was undrawn as of March 30, 2016 (the term loan, together with the revolving credit facility, the “First Lien Facility”). The First Lien Facility matures on October 15, 2019. An aggregate fee of $600,000 was paid to the agent and First Lien Lenders in connection with the First Lien Facility. As of December 31, 2016, Eagle Shipping’s total availability in the revolving credit facility under the First Lien Facility was $25,000,000. Eagle Shipping’s obligations under the First Lien Facility are secured by a first priority mortgage on each of the vessels currently in Eagle Shipping’s fleet and such other vessels that it may from time to time include with the approval of the First Lien Lenders, a first priority assignment of its earnings account, its liquidity account and its vessel-owning subsidiaries’ earnings accounts, a first priority assignment of all charters with terms that may exceed 18 months, freights, earnings, insurances, requisition compensation and management agreements with respect to the vessels ,a first priority pledge of the membership interests of each of Eagle Shipping’s vessel-owning subsidiaries, and a non-recourse pledge by the Company of the membership interests of Eagle Shipping. In the future, Eagle Shipping may grant additional security to the lenders from time to time. The A&R First Lien Agreement contains financial covenants requiring Eagle Shipping, among other things, to ensure that the aggregate market value of the vessels in Eagle Shipping’s fleet (plus the value of certain additional collateral) at all times on or after July 1, 2017 does not fall below 100% in the third and fourth quarters of 2017, 110% in 2018 and 120% in 2019 of the aggregate principal amount of debt outstanding (subject to certain adjustments) under the First Lien Facility and maintain minimum liquidity of not less than the greater of (i) $8,140,000 and (ii) $185,000 per vessel in Eagle Shipping’s fleet. In addition, the A&R First Lien Agreement also imposes operating restrictions on Eagle Shipping including limiting Eagle Shipping’s ability to, among other things: pay dividends; incur additional indebtedness; create liens on assets; acquire and sell capital assets (including vessels); and merge or consolidate with, or transfer all or substantially all of Eagle Shipping’s assets to, another person. The A&R First Lien Loan Agreement also includes customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation or warranty, a cross-default to other indebtedness and non-compliance with security documents. Further, there would be a default if any event occurs or circumstances arise in light of which, in the First Lien Lenders’ judgment, there is significant risk that Eagle Shipping is or would become insolvent. Eagle Shipping is not permitted to pay dividends. Indebtedness under the First Lien Facility may also be accelerated if Eagle Shipping experiences a change of control. Upon entering into the A&R First Lien Loan Agreement, Eagle Shipping paid three quarters of amortization payments with respect to the term loan under the First Lien Facility in the aggregate amount of $11,718,750, paid down $30,158,500, a portion of the amount outstanding in respect of the revolving credit facility under the First Lien Facility, and added cash to the balance sheet. In addition, the Company paid the first quarter amortization of $3,906,250 under the previously outstanding Exit Financing Facility. For the fiscal quarters ending June 30, 2017, and June 30, 2018 and the fiscal years ending December 31, 2017 and December 31, 2018 (each, a “Semi-Annual Determination Date”), Eagle Shipping is obligated to repay the term loan under the First Lien Facility in an amount equal to 75% of Eagle Shipping’s excess cash flow for the two fiscal quarters ended as of such Semi-Annual Determination Date, subject to a cap of such mandatory prepayments of $15,625,000 in any fiscal year. Thereafter, Eagle Shipping will make payments of $3,906,250 on January 15, 2019, April 15, 2019, and July 15, 2019, and a final balloon payment equal to the remaining amount outstanding under the term loan under the First Lien Facility on October 15, 2019. Eagle Shipping has prepaid $5,651,000 of the term loan as of December 31, 2016 pursuant to the terms of the A&R First Lien Loan Agreement relating to the mandatory prepayments upon sale of vessels. The repayment schedule above therefore has been adjusted to account for such prepayments made through December 31, 2016, such that Eagle Shipping is required to make the payments of $3,786,346 on January 15, 2019, April 15, 2019, and July 15, 2019, and a final balloon payment equal to the remaining amount outstanding under the First Lien Facility on October 15, 2019. As a result of the mandatory prepayments made through December 31, 2016, Eagle Shipping is not required to comply with the minimum security covenant until October 2017 pursuant to the terms of the A&R First Lien Loan Agreement. Second Lien Facility On March 30, 2016, Eagle Shipping, as borrower, and certain of its subsidiaries that were guarantors of the Company’s obligations under the Exit Financing Facility, as guarantors, entered into a Second Lien Loan Agreement (the “Second Lien Loan Agreement”) with certain lenders (the “Second Lien Lenders”) and Wilmington Savings Fund Society, FSB as agent for the Second Lien Lenders (the “Second Lien Agent”). The Second Lien Lenders include certain of the Company’s existing shareholders as well as other investors. The Second Lien Loan Agreement provides for a term loan in the amount of $60,000,000 (the “Second Lien Facility”), and matures on January 14, 2020 (91 days after the original stated maturity of the First Lien Facility). The term loan under the Second Lien Facility bears interest at a rate of LIBOR plus 14.00% per annum (with a 1.0% LIBOR floor) or the Base Rate (as defined in the Second Lien Loan Agreement) plus 13.00% per annum, paid in kind quarterly in arrears. The Company used the proceeds from the Second Lien Facility to pay down $30,158,500, a portion of the amount outstanding in respect of the revolving credit facility under the First Lien Facility, pay three quarters of amortization payments under the First Lien Facility, pay transaction fees in connection with the entry into the A&R First Lien Loan Agreement and the Second Lien Loan Agreement, and add cash to the balance sheet . Eagle Shipping’s obligations under the Second Lien Facility are secured by a second priority lien on the same collateral securing Eagle Shipping’s obligations under the First Lien Facility, subject to the terms of the Intercreditor Agreement (as defined below). Eagle Shipping may grant additional security to the Second Lien Lenders from time to time in the future, subject to the terms of the Intercreditor Agreement. The Second Lien Loan Agreement contains financial covenants substantially similar to those in the A&R First Lien Loan Agreement, subject to standard cushions, requiring Eagle Shipping, among other things, to ensure that the aggregate market value of the vessels in Eagle Shipping’s fleet (plus the value of certain additional collateral) at all times on or after July 1, 2017 does not fall below 100% in the third and fourth quarters of 2017, 110% in 2018 and 120% in 2019 of the aggregate principal amount of debt outstanding (subject to certain adjustments) under the Second Lien Facility (provided that Eagle Shipping will not be required to comply with such covenant until the discharge of its obligations under the A&R First Lien Loan Agreement) and to maintain a minimum liquidity of not less than the greater of (i) $6,512,000 and (ii) $148,000 per vessel in Eagle Shipping’s fleet. In addition, the Second Lien Loan Agreement also imposes operating restrictions on Eagle Shipping including limiting Eagle Shipping’s ability to, among other things: pay dividends; incur additional indebtedness; create liens on assets; acquire and sell capital assets (including vessels); and merge or consolidate with, or transfer all or substantially all of Eagle Shipping’s assets to, another person. Eagle Shipping may not prepay the Second Lien Facility while amounts or commitments under the First Lien Facility remain outstanding. The Second Lien Loan Agreement also includes customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation or warranty, a cross-default to other indebtedness and non-compliance with security documents. Further, there would be a default if any event occurs or circumstances arise in light of which, in the Second Lien Lenders’ judgment, there is significant risk that Eagle Shipping is or would become insolvent. Eagle Shipping is not permitted to pay dividends. Indebtedness under the Second Lien Facility may also be accelerated if Eagle Shipping experiences a change of control. In connection with the entry into the Second Lien Loan Agreement, on March 30, 2016, the Company agreed to issue 16,889,828 shares of common stock to the Second Lien Lenders pro rata based on their participation in the Second Lien Facility, which Second Lien Lenders received shares equivalent to approximately 90% of the outstanding common stock of the Company after such issuance. The issuance of the shares of common stock was made pursuant to the exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). In a first step, the Company issued and delivered 371,276 shares of common stock, representing approximately 19.4% of the Company’s pre-transaction outstanding shares of common stock, to the Second Lien Lenders. In a second step, approved by the Company’s shareholders at a special meeting held on August 2, 2016, the Company issued and delivered an additional 16,420,098 shares of common stock, to the Second Lien Lenders and an additional 98,454 shares of common stock, to the Chairman and Chief Executive Officer, both of whom participated as Second Lien Lenders. The Company has proportionately allocated the proceeds from the Second Lien Loan Agreement based on the relative fair values of the Second Lien Facility and the common stock issued to the Second Lien Lenders. The difference between the $60 million principal value of the Second Lien Facility and its relative fair value, amounting to approximately $17.8 million, has been recorded as a discount to the recorded value of the Second Lien Facility and as Additional Paid-in capital. This discount is being amortized using the effective interest method over the term of the Second Lien Facility as a component of interest expense. Intercreditor Agreement Concurrently with Eagle Shipping’s entry into the A&R First Lien Loan Agreement and the Second Lien Loan Agreement, and in connection with the granting of security interests in and liens on the collateral securing obligations under those agreements, Eagle Shipping entered into the Intercreditor Agreement between the first lien agent and the second lien agent (the “Intercreditor Agreement”) . The Intercreditor Agreement governs the relative rights and priorities of the secured parties in respect of liens on the assets of Eagle Shipping and its subsidiaries securing the First Lien Facility and the Second Lien Facility.

Note

Corporate Reorganization

March

30,

2016,

we entered into the contribution agreement (the “Contribution Agreement”) with a newly-formed wholly-owned subsidiary, Eagle Shipping LLC, a limited liability company organized under the laws of the Marshall Islands and a wholly-owned subsidiary of the Company (“Eagle Shipping”), pursuant to which the Company transferred, assigned and contributed to Eagle Shipping, and Eagle Shipping received, accepted and assumed, all of the tangible and intangible assets of the Company (other than the membership interests in Eagle Shipping owned by the Company and certain deposit accounts held by the Company, which deposit account balances were transferred) and all of the liabilities of the Company, including all of the Company’s rights and obligations under the senior secured credit facility dated as of

October

2014

(the “Exit Financing Facility”) (the “Contribution”). Immediately following the Contribution, Eagle Shipping became the direct parent company of each of the Company’s previously directly-owned subsidiaries and the indirect parent company of each of the Company’s previously indirectly-owned subsidiaries. The Contribution was part of a series of transactions contemplated by the agreements also entered into on

March

30,

2016

and described below, which transactions were consummated on

March

30,

2016,

after the fulfillment of certain conditions precedent.

First Lien Facility

March

30,

2016,

Eagle Shipping, as borrower, and certain of its subsidiaries that were guarantors of the Company’s obligations under the Company’s senior secured credit facility (the “Exit Financing Facility”)

, as guarantors, entered into an Amended and Restated First Lien Loan Agreement (the “A&R First Lien Loan Agreement”) with the lenders thereunder (the “First Lien Lenders”) and ABN AMRO Capital USA LLC, as agent and security trustee for the lenders. The A&R First Lien Loan Agreement amended and restated the Exit Financing Facility in its entirety, providing for Eagle Shipping to be the borrower in the place of the Company, and further provided for a waiver of any and all events of default occurring as a result of the voluntary OFAC Disclosure (as defined below under Note

“Commitments and Contingencies - Legal Proceedings”). The A&R First Lien Loan Agreement provides for a term loan which was outstanding as of

March

30,

2016,

in the amount of

$201,468,750

after giving effect to the entry into the A&R First Lien Loan Agreement and the Second Lien Loan Agreement (as defined below) as well as a

$50,000,000

revolving credit facility, of which

$10,000,000

was undrawn as of

March

30,

2016

(the term loan, together with the revolving credit facility, the “First Lien Facility”). The First Lien Facility matures on

October

15,

2019.

An aggregate fee of

$600,000

was paid to the agent and First Lien Lenders in connection with the First Lien Facility.

As of

December

31,

2016,

Eagle Shipping’s total availability in the revolving credit facility under the First Lien Facility was

$25,000,000.

Eagle Shipping’s obligations under the First Lien Facility are secured by a

first

priority mortgage on each of the vessels currently in Eagle Shipping’s fleet and such other vessels that it

may

from time to time include with the approval of the First Lien Lenders, a

first

priority assignment of its earnings account, its liquidity account and its vessel-owning subsidiaries’ earnings accounts, a

first

priority assignment of all charters with terms that

may

exceed

months, freights, earnings, insurances, requisition compensation and management agreements with respect to the vessels

first

priority pledge of the membership interests of each of Eagle Shipping’s vessel-owning subsidiaries, and a non-recourse pledge by the Company of the membership interests of Eagle Shipping. In the future, Eagle Shipping

may

grant additional security to the lenders from time to time.

The A&R First Lien Agreement contains financial covenants requiring Eagle Shipping, among other things, to ensure that the aggregate market value of the vessels in Eagle Shipping’s fleet (plus the value of certain additional collateral) at all times on or after

July

2017

does not fall below

100%

in the

third

and

fourth

quarters of

2017,

110%

2018

and

120%

2019

of the aggregate principal amount of debt outstanding (subject to certain adjustments) under the First Lien Facility and maintain minimum liquidity of not less than the greater of (i)

$8,140,000

and (ii)

$185,000

per vessel in Eagle Shipping’s fleet. In addition, the A&R First Lien Agreement also imposes operating restrictions on Eagle Shipping including limiting Eagle Shipping’s ability to, among other things: pay dividends; incur additional indebtedness; create liens on assets; acquire and sell capital assets (including vessels); and merge or consolidate with, or transfer all or substantially all of Eagle Shipping’s assets to, another person. The A&R First Lien Loan Agreement also includes customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation or warranty, a cross-default to other indebtedness and non-compliance with security documents. Further, there would be a default if any event occurs or circumstances arise in light of which, in the First Lien Lenders’ judgment, there is significant risk that Eagle Shipping is or would become insolvent. Eagle Shipping is not permitted to pay dividends. Indebtedness under the First Lien Facility

may

also be accelerated if Eagle Shipping experiences a change of control.

Upon entering into the A&R First Lien Loan Agreement, Eagle Shipping paid

three

quarters of amortization payments with respect to the term loan under the First Lien Facility in the aggregate amount of

$11,718,750,

paid down

$30,158,500,

a portion of the amount outstanding in respect of the revolving credit facility under the First Lien Facility, and added cash to the balance sheet. In addition, the Company paid the

first

quarter amortization of

$3,906,250

under the previously outstanding Exit Financing Facility. For the fiscal quarters ending

June

30,

2017,

and

June

30,

2018

and the fiscal years ending

December

31,

2017

and

December

31,

2018

(each, a “Semi-Annual Determination Date”), Eagle Shipping is obligated to repay the term loan under the First Lien Facility in an amount equal to

75%

of Eagle Shipping’s excess cash flow for the

two

fiscal quarters ended as of such Semi-Annual Determination Date, subject to a cap of such mandatory prepayments of

$15,625,000

in any fiscal year. Thereafter, Eagle Shipping will make payments of

$3,906,250

January

15,

2019,

April

15,

2019,

and

July

15,

2019,

and a final balloon payment equal to the remaining amount outstanding under the term loan under the First Lien Facility on

October

15,

2019.

Eagle Shipping has prepaid

$5,651,000

of the term loan as of

December

31,

2016

pursuant to the terms of the A&R First Lien Loan Agreement relating to the mandatory prepayments upon sale of vessels. The repayment schedule above therefore has been adjusted to account for such prepayments made through

December

31,

2016,

such that Eagle Shipping is required to make the payments of

$3,786,346

January

15,

2019,

April

15,

2019,

and

July

15,

2019,

and a final balloon payment equal to the remaining amount outstanding under the First Lien Facility on

October

15,

2019.

As a result of the mandatory prepayments made through

December

31,

2016,

Eagle Shipping is not required to comply with the minimum security covenant until

October

2017

pursuant to the terms of the A&R First Lien Loan Agreement.

Second Lien Facility

March

30,

2016,

Eagle Shipping, as borrower, and certain of its subsidiaries that were guarantors of the Company’s obligations under the Exit Financing Facility, as guarantors, entered into a Second Lien Loan Agreement (the “Second Lien Loan Agreement”) with certain lenders (the “Second Lien Lenders”) and Wilmington Savings Fund Society, FSB as agent for the Second Lien Lenders (the “Second Lien Agent”). The Second Lien Lenders include certain of the Company’s existing shareholders as well as other investors. The Second Lien Loan Agreement provides for a term loan in the amount of

$60,000,000

(the “Second Lien Facility”), and matures on

January

14,

2020

(91

days after the original stated maturity of the First Lien Facility). The term loan under the Second Lien Facility bears interest at a rate of LIBOR plus

14.00%

per annum (with a

1.0%

LIBOR floor) or the Base Rate (as defined in the Second Lien Loan Agreement) plus

13.00%

per annum, paid in kind quarterly in arrears. The Company used the proceeds from the Second Lien Facility to pay down

$30,158,500,

a portion of the amount outstanding in respect of the revolving credit facility under the First Lien Facility, pay

three

quarters of amortization payments under the First Lien Facility, pay transaction fees in connection with the entry into the A&R First Lien Loan Agreement and the Second Lien Loan Agreement, and add cash to the balance sheet

Eagle Shipping’s obligations under the Second Lien Facility are secured by a

second

priority lien on the same collateral securing Eagle Shipping’s obligations under the First Lien Facility, subject to the terms of the Intercreditor Agreement (as defined below). Eagle Shipping

may

grant additional security to the Second Lien Lenders from time to time in the future, subject to the terms of the Intercreditor Agreement.

The Second Lien Loan Agreement contains financial covenants substantially similar to those in the A&R First Lien Loan Agreement, subject to standard cushions, requiring Eagle Shipping, among other things, to ensure that the aggregate market value of the vessels in Eagle Shipping’s fleet (plus the value of certain additional collateral) at all times on or after

July

2017

does not fall below

100%

in the

third

and

fourth

quarters of

2017,

110%

2018

and

120%

2019

of the aggregate principal amount of debt outstanding (subject to certain adjustments) under the Second Lien Facility (provided that Eagle Shipping will not be required to comply with such covenant until the discharge of its obligations under the A&R First Lien Loan Agreement) and to maintain a minimum liquidity of not less than the greater of (i)

$6,512,000

and (ii)

$148,000

per vessel in Eagle Shipping’s fleet. In addition, the Second Lien Loan Agreement also imposes operating restrictions on Eagle Shipping including limiting Eagle Shipping’s ability to, among other things: pay dividends; incur additional indebtedness; create liens on assets; acquire and sell capital assets (including vessels); and merge or consolidate with, or transfer all or substantially all of Eagle Shipping’s assets to, another person. Eagle Shipping

may

not prepay the Second Lien Facility while amounts or commitments under the First Lien Facility remain outstanding.

The Second Lien Loan Agreement also includes customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation or warranty, a cross-default to other indebtedness and non-compliance with security documents. Further, there would be a default if any event occurs or circumstances arise in light of which, in the Second Lien Lenders’ judgment, there is significant risk that Eagle Shipping is or would become insolvent. Eagle Shipping is not permitted to pay dividends. Indebtedness under the Second Lien Facility

may

also be accelerated if Eagle Shipping experiences a change of control.

In connection with the entry into the Second Lien Loan Agreement, on

March

30,

2016,

the Company agreed to issue

16,889,828

shares of common stock to the Second Lien Lenders pro rata based on their participation in the Second Lien Facility, which Second Lien Lenders received shares equivalent to approximately

90%

of the outstanding common stock of the Company after such issuance. The issuance of the shares of common stock was made pursuant to the exemption from registration under Section

4(a)(2)

of the Securities Act of

1933,

as amended (the “Securities Act”).

In a

first

step, the Company issued and delivered

371,276

shares of common stock, representing approximately

19.4%

of the Company’s pre-transaction outstanding shares of common stock, to the Second Lien Lenders. In a

second

step, approved by the Company’s shareholders at a special meeting held on

August

2016,

the Company issued and delivered an additional

16,420,098

shares of common stock, to the Second Lien Lenders and an additional

98,454

shares of common stock, to the Chairman and Chief Executive Officer, both of whom participated as Second Lien Lenders.

The Company has proportionately allocated the proceeds from the Second Lien Loan Agreement based on the relative fair values of the Second Lien Facility and the common stock issued to the Second Lien Lenders. The difference between the

$60

million principal value of the Second Lien Facility and its relative fair value, amounting to approximately

$17.8

million, has been recorded as a discount to the recorded value of the Second Lien Facility and as Additional Paid-in capital. This discount is being amortized using the effective interest method over the term of the Second Lien Facility as a component of interest expense.

Intercreditor Agreement

Concurrently with Eagle Shipping’s entry into the A&R First Lien Loan Agreement and the Second Lien Loan Agreement, and in connection with the granting of security interests in and liens on the collateral securing obligations under those agreements, Eagle Shipping entered into the Intercreditor Agreement between the

first

lien agent and the

second

lien agent (the “Intercreditor Agreement”)

. The Intercreditor Agreement governs the relative rights and priorities of the secured parties in respect of liens on the assets of Eagle Shipping and its subsidiaries securing the First Lien Facility and the Second Lien Facility.