Performance Shipping Converts $150M Bonds to Unsecured, Raises Liquidity Covenant to $30M
PSHG•Performance Shipping received approval to convert its $150 million 9.875% senior secured bonds into senior unsecured obligations, release mortgages on P. Monterey and P. Sophia, remove proceeds restrictions and lift its liquidity covenant to $30 million. It paid a 0.325% one-time amendment fee.
1. Bond Amendment Details
Performance Shipping secured bondholder approval to amend its 9.875% bonds dated July 15, 2025, converting the $150 million issue from senior secured to senior unsecured. The amendments release ship mortgages on the vessels P. Monterey and P. Sophia and eliminate use-of-proceeds restrictions on future collateral sales, with documentation to be finalized in an amendment and restatement agreement.
2. Covenant and Fee Adjustments
As part of the amendment, the minimum liquidity covenant increases from $20.0 million to $30.0 million, enhancing the company’s cash buffer. Performance Shipping agreed to pay a one-time amendment fee equal to 0.325% of the bonds’ nominal amount, reflecting bondholder support.
3. Fleet Growth and Refinancing Outlook
Over the past year the company added four vessels on 3- to 7-year charters and sold two older ships, boosting fleet size by two and reducing average vessel age to six years. With a contract backlog near $500 million and unencumbered assets, Performance Shipping positions itself to refinance obligations more favorably over the remaining three-year bond term.
