Document

6-K 1 sc-6kx2023x06x30.htm 6-K Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

Commission File Number 001-39237

ATLAS CORP.

(Exact name of Registrant as specified in its Charter)

23 Berkeley Square

London, United Kingdom

W1J 6HE

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F ☒ Form 40-F ☐

Information Contained in this Form 6-K Report

Exhibit I to this Report contains certain financial information of Seaspan Corporation, a wholly owned subsidiary of Atlas Corp., as of and for three months ended June 30, 2023.

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, thereunto duly authorized.


	ATLAS CORP.

Date: August 23, 2023	By:	/s/ Bing Chen
		Bing Chen
		Chief Executive Officer and Interim Chief Financial Officer
		(Principal Executive, Financial and Accounting Officer)

INDEX

EXHIBIT I


			Financial Statements			1

			Management’s Discussion and Analysis of Financial Condition and Results of Operations			19

Unless we otherwise specify, when used in this Report, the terms “Seaspan”, the “Company”, “we”, “our” and “us” refer to Seaspan Corporation and its subsidiaries.

ITEM 1 - INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

SEASPAN CORPORATION

Interim Consolidated Balance Sheets

(Unaudited)

(Expressed in millions of United States dollars)


	June 30, 2023		December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	156.0	$	150.7
Accounts receivable	49.4		36.7
Due from related party (note 3)	4.3		18.4
Prepaid expenses and other	70.8		43.2
Net investment in lease (note 4)	22.1		21.0
Assets classified as held for sale (note 5)	20.6		19.4
	323.2		289.4

Vessels (note 5)	9,273.8		8,227.6
Right-of-use asset (note 6)	515.3		741.9
Net investment in lease (note 4)	875.5		887.4
Goodwill	75.3		75.3
Derivative instruments	107.4		153.5
Other assets (note 7)	288.0		240.0
	$	11,458.5	$	10,615.1
Liabilities and shareholder's equity
Current liabilities:
Accounts payable and accrued liabilities	$	286.0	$	175.5
Deferred revenue	41.5		24.6
Long-term debt - current (note 8)	241.3		224.3
Operating lease liabilities - current	113.2		113.6
Finance lease liabilities - current	54.5		222.2
Other financing arrangements - current (note 9)	203.7		147.5
Other liabilities - current	1.4		2.4
	941.6		910.1

Long-term debt (note 8)	2,870.6		3,316.7
Operating lease liabilities	348.3		388.0
Other financing arrangements (note 9)	2,884.1		1,940.3
Derivative instruments	—		53.7
Other liabilities	95.5		44.5
Total liabilities	7,140.1		6,653.3

Shareholder's equity:
Share capital	2.5		2.5
Additional paid in capital	3,920.9		3,675.8
Deficit	412.6		301.6
Accumulated other comprehensive loss	(17.6)		(18.1)
	4,318.4		3,961.8
	$	11,458.5	$	10,615.1

Commitments and contingencies (note 12)

Subsequent events (note 14)

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Operations

(Unaudited)

(Expressed in millions of United States dollars)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenue (note 11)	$	403.4	$	378.8	$	791.7	$	766.0
Operating expenses:
Ship operating	84.6		77.6		164.8		152.6
Depreciation and amortization	89.7		81.5		174.0		159.9
General and administrative	14.4		11.5		33.0		23.7
Operating leases	29.7		29.0		58.9		61.9
Loss on disposal of vessels (note 5)	0.6		2.0		1.1		4.0

	219.0		201.6		431.8		402.1
Operating earnings	184.4		177.2		359.9		363.9
Other expenses (income):
Interest expense	82.0		46.5		162.2		87.4
Interest income	(4.5)		(0.2)		(6.5)		(0.2)
Loss on debt extinguishment (note 8)	8.9		2.4		32.6		2.4
Gain on derivative instruments	(29.3)		(39.1)		(18.2)		(76.5)
Other expenses	6.5		7.0		12.8		13.7
	63.6		16.6		182.9		26.8
Net earnings	$	120.8	$	160.6	$	177.0	$	337.1

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Comprehensive Income

(Unaudited)

(Expressed in millions of United States dollars)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Net earnings	$	120.8	$	160.6	$	177.0	$	337.1
Other comprehensive income:
Amounts reclassified to net earnings during the period relating to cash flow hedging instruments	0.2		0.3		0.5		0.5
Comprehensive income	$	121.0	$	160.9	$	177.5	$	337.6

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Shareholder’s Equity

(Unaudited)

(Expressed in millions of United States dollars, except number of shares)

Three Months Ended June 30, 2023


	Number of			Additional				Accumulated other		Total
	common	Common		paid-in		Retained		comprehensive		shareholder's
	shares	shares		capital		earnings		loss		equity
Balance, March 31, 2023	249,219,800	$	2.5	$	3,666.5	$	321.8	$	(17.8)	$	3,973.0
Net earnings	—	—		—		120.8		—		120.8
Other comprehensive income	—	—		—		—		0.2		0.2
Capital Contribution from Atlas	—	—		253.1		—		—		253.1
Dividends on common shares	—	—		—		(30.0)		—		(30.0)
Share-based compensation expense	—	—		1.3		—		—		1.3
Balance, June 30, 2023	249,219,800	$	2.5	$	3,920.9	$	412.6	$	(17.6)	$	4,318.4

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Shareholder’s Equity

(Unaudited)

(Expressed in millions of United States dollars, except number of shares)

Three Months Ended June 30, 2022


	Number of			Additional				Accumulated other		Total
	common	Common		paid-in				comprehensive		shareholder's
	shares	shares		capital		Deficit		loss		equity
Balance, March 31, 2022	249,219,800	$	2.5	$	3,568.5	$	56.7	$	(18.9)	$	3,608.8
Net earnings	—	—		—		160.6		—		160.6
Other comprehensive income	—	—		—		—		0.3		0.3
Capital contribution from Atlas (note 3)	—	—		100.0		—		—		100.0
Dividends on common shares	—	—		—		(51.0)		—		(51.0)
Share-based compensation expense	—	—		2.1		—		—		2.1
Balance, June 30, 2022	249,219,800	$	2.5	$	3,670.6	$	166.3	$	(18.6)	$	3,820.8

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Shareholder’s Equity

(Unaudited)

(Expressed in millions of United States dollars, except number of shares)

Six Months Ended June 30, 2023


	Number of			Additional		Retained		Accumulated other		Total
	common	Common		paid-in		earnings/		comprehensive		shareholder's
	shares	shares		capital		Deficit		loss		equity
Balance, December 31, 2022	249,219,800	$	2.5	$	3,675.8	$	301.6	$	(18.1)	$	3,961.8
Net earnings	—	—		—		177.0		—		177.0
Other comprehensive income	—	—		—		—		0.5		0.5
Capital Contribution from Atlas	—	—		253.1		—		—		253.1
Dividends on common shares	—	—		—		(66.0)		—		(66.0)
Share-based compensation expense	—	—		(8.0)		—		—		(8.0)
Balance, June 30, 2023	249,219,800	$	2.5	$	3,920.9	$	412.6	$	(17.6)	$	4,318.4

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Shareholder’s Equity

(Unaudited)

(Expressed in millions of United States dollars, except number of shares)

Six Months Ended June 30, 2022


	Number of			Additional		Retained		Accumulated other		Total
	common	Common		paid-in		earnings/		comprehensive		shareholder's
	shares	shares		capital		Deficit		loss		equity
Balance, December 31, 2021	249,219,800	$	2.5	$	3,565.1	$	(67.2)	$	(19.1)	$	3,481.3
Impact of accounting policy change (note 2(b))	—	—		—		(5.1)		—		(5.1)
Adjusted Balance, December 31, 2021	249,219,800	2.5		3,565.1		(72.3)		(19.1)		3,476.2
Net earnings	—	—		—		337.1		—		337.1
Other comprehensive income	—	—		—		—		0.5		0.5
Capital contribution from Atlas (note 3)	—	—		100.0		—		—		100.0
Dividends on common shares	—	—		—		(98.5)		—		(98.5)
Share-based compensation expense	—	—		5.5		—		—		5.5
Balance, June 30, 2022	249,219,800	$	2.5	$	3,670.6	$	166.3	$	(18.6)	$	3,820.8

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Interim Consolidated Statements of Cash Flows

(Unaudited)

(Expressed in millions of United States dollars)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Cash from (used in):
Operating activities:
Net earnings	$	120.8	$	160.6	$	177.0	$	337.1
Items not involving cash:
Depreciation and amortization	89.7		81.5		174.0		159.9
Change in right-of-use asset	23.3		26.1		46.1		55.4
Non-cash interest expense and accretion	8.5		4.7		13.0		9.5
Unrealized change in derivative instruments	(20.5)		(43.9)		(1.8)		(87.4)
Amortization of acquired revenue contracts and deferred revenue	8.4		4.6		15.6		9.5

Non-cash adjustment related to purchase options on finance leases	15.6		—		24.8		—
Loss on debt extinguishment	8.9		2.4		32.6		2.4
Loss on vessel disposal	0.6		2.0		1.1		4.0
Share-based compensation	1.3		—		(8.0)		—
Other	(16.7)		(0.6)		(21.0)		1.9
Changes in assets and liabilities:
Accounts receivable	(10.7)		(5.4)		—		(13.8)
Net investment in lease	5.4		5.6		10.8		9.9
Prepaid expenses and other	(17.8)		3.8		(27.6)		(3.5)
Deferred dry-dock	(67.8)		(19.9)		(89.5)		(22.1)
Other assets	9.4		3.0		12.3		0.8
Accounts payable and accrued liabilities	94.0		13.6		111.5		5.7
Deferred revenue	36.4		5.4		61.8		(11.3)
Operating lease liabilities	(17.5)		(21.7)		(40.2)		(48.5)
Finance lease liabilities	0.7		(7.5)		3.8		(10.5)
Derivative instruments	(8.8)		4.8		(16.3)		10.9
Cash from operating activities	263.2		219.1		480.0		409.9

Investing activities:
Acquisition of /additions to vessels, including vessels under construction	(774.3)		(345.0)		(1,045.8)		(463.3)
Purchase option exercised on finance lease	(108.2)		—		(161.2)		—
Prepayment on vessel purchase	—		—		—		—
Payment on settlement of interest swap agreements	8.0		(6.3)		14.9		(11.4)
Other assets and liabilities	(3.4)		0.8		(2.4)		3.1
Proceeds from vessel sales (note 5)	17.5		212.3		39.6		256.2
Capitalized interest (note 5)	(16.3)		(10.8)		(36.1)		(20.2)
Cash used in investing activities	(876.7)		(149.0)		(1,191.0)		(235.6)

Financing activities:
Repayments of long-term debt and other financing arrangements	(871.0)		(315.1)		(918.1)		(384.7)
Payment of lease liabilities	(2.6)		—		(10.3)		—
Issuance of long-term debt and other financing arrangements	896.7		320.0		1,236.7		320.0

Settlement of capped call	—		—		25.3		—
Pre-delivery financing	48.3		—		196.0		—
Financing fees	9.6		(1.4)		(0.4)		(6.5)
Dividends on common shares	(30.0)		(51.0)		(66.0)		(98.5)
Capital contribution from Atlas (note 3)	253.1		100.0		253.1		100.0
Cash from financing activities	304.1		52.5		716.3		(69.7)
(Decrease) increase in cash and cash equivalents	(309.4)		122.6		5.3		104.6
Cash and cash equivalents and restricted cash, beginning of period	465.4		151.0		150.7		169.0
Cash and cash equivalents and restricted cash, end of period	$	156.0	$	273.6	$	156.0	$	273.6

Supplemental cash flow information (note 10)

See accompanying notes to consolidated financial statements.

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

1.General:

Seaspan Corporation (“Seaspan” or the “Company”) was incorporated on May 3, 2005 in the Marshall Islands and owns and operates containerships pursuant to primarily long-term, fixed-rate time charters to major container liner companies. Seaspan is a wholly owned subsidiary of Atlas Corp. ("Atlas").

On March 28, 2023, pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), dated as of October 31, 2022, by and among Atlas, Poseidon Acquisition Corp. (“Poseidon”), an entity formed by certain affiliates of Fairfax Financial Holdings Limited (“Fairfax”), certain affiliates of the Washington Family (“Washington”), David Sokol, Chairman of the Board of Directors of the Company (the “Chairman”), Ocean Network Express Pte. Ltd., (“ONE”) and certain of their respective affiliates (collectively, the “Consortium”), and Poseidon Merger Sub, Inc., a wholly-owned subsidiary of Poseidon (“Merger Sub”), Merger Sub merged with and into Atlas with Atlas continuing as the surviving corporation and a wholly-owned subsidiary of Poseidon (other than with respect to Atlas’ preferred shares) (the “Merger”). Each common share outstanding prior to the Merger, other than common shares contributed to Poseidon immediately prior to the consummation of the Merger by Fairfax, Washington, the Chairman and the chief executive officer, were converted into the right to receive $15.50 per common share in cash.

2.Significant accounting policies:

(a)Basis of presentation:

Except for the changes described in note 2(b), the accompanying interim financial information of Seaspan has been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), on a basis consistent with those followed in the December 31, 2022 audited annual consolidated financial statements of Seaspan. The accompanying interim financial information is unaudited and reflects all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods presented.

(b) Comparative information:

Certain prior period information has been reclassified to conform with current financial statement presentation.

3.Related party transactions:

The income or expenses with related parties relate to amounts paid to or received from individuals or entities that are associated with the Company or with the Company’s directors or officers and these transactions are governed by pre-arranged contracts.

(a)Pursuant to ship management agreements, the Company manages the ship operations of the vessels owned by its joint venture with Zhejiang Energy Group. During the three and six months ended June 30, 2023, the Company earned revenue of $2,681,000 and $5,235,000, respectively (2022 – $1,438,000 and $1,928,000, respectively) and incurred expenses of $2,531,000 and $4,937,000, respectively (2022 – $1,353,000 and $1,813,000, respectively) in connection with the ship management of the vessels.

(b)Transactions with ONE

In June 30, 2023, the Company completed the sale of one 4,250 TEU vessel for net proceeds of $17,250,000. The Company continues to manage the ship operations of this vessel and during the three and six months ended June 30, 2023, the Company earned revenue of $177,000 (2022 - nil) and incurred expenses of $166,000 (2022 - nil) in connection with the ship management of the vessel.

In June 30, 2023, the Company completed the purchase of two secondhand 8,100 TEU vessels from ONE for an aggregate purchase price of $54,400,000 (note 5).

Since the closing of the Merger (note 1(b)), the Company earned revenue of $92,500,000 from ONE relating to the time charter of vessels and management of one vessel, as described above.

(c)Transactions with Atlas:

The Company makes dividend payments to Atlas on a quarterly basis to service Atlas’ payment of dividends to holders of its common and preferred shares. During the three and six months ended June 30, 2023, the Company

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

3.Related party transactions (continued):

(c)Transactions with Atlas (continued):

declared and paid dividends of $30,000,000 and $66,000,000, respectively (2022 - $51,000,000 and $98,500,000, respectively) to Atlas.

The Company routinely makes payments to cover expenses on behalf of Atlas. As of June 30, 2023, amounts due from Atlas are non-interest bearing, unsecured and have no fixed repayment terms. The Company provides certain management services to Atlas in exchange for a management fee. For the three and six months ended June 30, 2023, the management service revenue recognized from this arrangement was $2,946,000 and $5,921,000, respectively (2022 – $3,129,000 and $5,714,000, respectively).

In connection with the Merger (note 1), various restricted stock grants were amended. Under the amended agreements, restricted stock units that were unvested as of the time of the Merger were converted into the right to receive, at the time at which such restricted stock unit would have been settled in common shares of the Company, a cash payment in an amount equal to the merger consideration of $15.50. In addition, the stock options previously granted to the chief executive officer were amended such that vested and unexercised options were cash settled at $15.50 less the exercise price. For the unvested options, each tranche will be cash settled at the vesting date at $15.50 less the exercise price. As a result of these amendments, the additional paid in capital was reduced as the awards will be settled in cash.

4.Net investment in lease:


	June 30, 2023		December 31, 2022
Undiscounted lease receivable	$	1,676.4	$	1,724.4
Unearned interest income	(778.8)		(816.0)
Net investment in lease, total	897.6		908.4
Current portion of net investment in lease	(22.1)		(21.0)
Net investment in lease	$	875.5	$	887.4

At June 30, 2023, the undiscounted minimum cash flows related to lease receivable on direct financing leases are as follows:


2023	$	48.8
2024	97.1
2025	96.9
2026	96.9
2027	96.9
Thereafter	1,239.8
	$	1,676.4

5.Vessels:


June 30, 2023	Cost		Accumulated depreciation		Net book value
Vessels	$	10,752.3	$	(2,906.5)	$	7,845.8
Vessels under construction	1,428.0		—		1,428.0
Total	$	12,180.3	$	(2,906.5)	$	9,273.8

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

5.Vessels (continued):


December 31, 2022	Cost		Accumulated depreciation		Net book value
Vessels	$	9,610.7	$	(2,805.6)	$	6,805.1
Vessels under construction	1,422.5		—		1,422.5
Total	$	11,033.2	$	(2,805.6)	$	8,227.6

During the three and six months ended June 30, 2023, depreciation and amortization expense relating to vessels was $76,718,000 and $149,373,000, respectively (2022 - 68,833,000 and $139,959,000, respectively).

Vessel sales and deliveries

In January, 2023, the Company completed the sale of one 4,250 TEU vessel for gross proceeds of $21,600,000.

In June 2023, the Company completed the sale of one 4,250 TEU vessel for gross proceeds of $17,250,000. This vessel had previously be classified as an asset held for sale and the Company recognized a loss on sale of $3,555,000.

During the six months ended June 30, 2023, the Company took delivery of seven newbuild vessels. The vessels range in size from 15,000 to 15,500 TEU and each commenced a long-term charter upon delivery. The aggregate purchase price for the newbuild vessels delivered during the six months ended June 30, 2023 was $896,100,000.

In June 2023, the Company completed the purchase of two secondhand 8,100 TEU vessels from ONE for an aggregate purchase price of $54,400,000.

Asset classified as held for sale

In July 2023, the Company entered into memorandum of agreement with a liner company for the sale of a 4,250 TEU vessel. As at June 30, 2023 the vessel is classified as held for sale (note 14(a)).

Vessels under construction:

As at June 30, 2023, the Company has 51 vessels under construction (December 31, 2022 – 58 vessels).

During the three months ended June 30, 2023, vessels under construction includes $17,155,000 of capitalized interest and $632,854,000 of installment payments, respectively (2022 - $10,956,000 and $321,644,000, respectively).

During the six months ended June 30, 2023, vessels under construction includes $34,921,000 of capitalized interest and $876,005,000 of installment payments, respectively (2022 - $20,303,000 and $424,952,000, respectively).

6.Right-of-use assets:


June 30, 2023	Cost		Accumulated amortization		Net book value
Vessel operating leases	$	835.5	$	(380.9)	$	454.6
Other operating leases	9.6		(7.1)		2.5
Vessel finance leases	60.6		(2.4)		58.2
Right-of-use assets	$	905.7	$	(390.4)	$	515.3


December 31, 2022	Cost		Accumulated amortization		Net book value

Vessel operating leases	$	835.5	$	(335.5)	$	500.0
Other operating leases	9.5		(6.3)		3.2
Vessel finance leases	246.6		(7.9)		238.7
Right-of-use assets	$	1,091.6	$	(349.7)	$	741.9

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

6.Right-of-use assets (continued):

In 2022, the Company exercised options under existing lease financing arrangements to purchase four 10,000 TEU vessels. Three purchases were completed in January through May 2023 at the pre-determined purchase price of $52,690,000 per vessel.

During the three and six months ended June 30, 2023, the change in right-of-use assets was $23,300,000 and $46,100,000, respectively (2022 - $26,100,000 and $55,400,000, respectively).

7.Other assets:


	June 30, 2023		December 31, 2022
Intangible assets	$	42.9	$	52.2
Deferred dry-dock	155.4		86.9
Deferred financing fees on undrawn financings	57.9		57.3
Other	31.8		43.6
Other assets	$	288.0	$	240.0

8.Long-term debt:


	June 30, 2023		December 31, 2022
Revolving credit facilities (a) (e)	$	80.0	$	—
Term loan credit facilities (b) (e)	1,293.5		1,132.5
Senior unsecured notes (c)	775.7		1,250.0
Senior Unsecured Exchangeable Notes (d)	—		201.3
Senior secured notes	1,000.0		1,000.0
	3,149.2		3,583.8

Deferred financing fees	(37.3)		(42.8)
Long-term debt	3,111.9		3,541.0
Current portion of long-term debt	(241.3)		(224.3)
Long-term debt	$	2,870.6	$	3,316.7

(a)Revolving credit facilities:

As at June 30, 2023, the Company had two revolving credit facilities available, which provided for aggregate borrowings of up to $650,000,000 (December 31, 2022 – $650,000,000), of which $570,000,000 (December 31, 2022 - $650,000,000) was undrawn.

The Company is subject to commitment fees ranging between 0.45% and 0.5% (December 31, 2022 – 0.45% and 0.5%) calculated on the undrawn amounts under the various facilities.

(b)Term loan credit facilities:

In March 2023, the Company entered into amended and restated senior secured loan facilities which increase the commitments under the bank loan facilities by $250,000,000, (i) $200,000,000 of which were drawn immediately and $50,000,000 of which may be drawn by the Company on or before September 3, 2023, (ii) increase the amount of total borrowing permitted relative to total assets from 65% to 75%, (iii) replace the London Interbank Offered Rate with Secured Overnight Financing Rate as the reference interest rate, and (iv) extend the maturities of tranches due in 2026 and 2027 by approximately two years.

As at June 30, 2023, the Company has entered into $3,251,583,884 (December 31, 2022 - $3,651,231,000) of term loan credit facilities available, of which $1,958,062,666 (December 31, 2022 - $2,518,743,000) was undrawn.

Term loan credit facilities mature between August 10, 2023 and January 21, 2030.

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

8.Long-term debt (continued):

(b)Term loan credit facilities (continued):

For the Company’s floating rate term loan credit facilities, interest is calculated based on three month or six month benchmark rate plus a margin per annum, dependent on the interest period selected by the Company. The three month and six month average LIBOR was 5.6% and 5.2%, respectively (December 31, 2022 – 4.8% and 3.5%, respectively) and the three month average SOFR was 5.5% (December 31, 2022 – 3.0%) The margins ranged between 0.4% and 2.01% as at June 30, 2023 (December 31, 2022 – 0.35% and 2.0%).

For one of our term loan credit facilities with a total principal outstanding of $8,039,000 (December 31, 2022 - $14,425,000), interest is calculated based on the Export-Import Bank of Korea (KEXIM) rate plus 0.7% per annum.

The Company is subject to commitment fees ranging between 0.25% and 0.6% (December 31, 2022 – 0.25% and 0.6%) calculated on the undrawn amounts under the various facilities.

The weighted average rate of interest, including the applicable margin, was 7.3% at June 30, 2023 (December 31, 2022 – 6.4%) for term loan credit facilities. Interest payments are made in monthly, quarterly or semi-annual payments.

The following is a schedule of future minimum repayments under our term loans credit facilities as of June 30, 2023:


Remainder of 2023	$	165.9
2024	99.9
2025	99.9
2026	99.9
2027	99.9
Thereafter	728.0
	$	1,293.5

(c)As a result of the Merger (note 1), Atlas’ common shares were de-listed on April 10, 2023. The Company has notified the holders of the 2024 NOK Bonds and the 2026 NOK Bonds of this de-listing event and that each holder of the 2024 NOK Bonds and the 2026 NOK Bonds had a right to require the Company to purchase all or some of the bonds held by such holder (a “NOK Put Option”) at a price equal to 101% of the principal amount plus accrued interest. Each holder may exercise a NOK Put Option during the exercise period which ended on May 3, 2023. On May 10, 2023, the Company repurchased $179,400,000 of 2024 NOK Bonds and $294,900,000 of the 2026 NOK Bonds. In each case, the Company purchased from holders who exercised their NOK Put Options, representing 101% of the principal amount plus accrued premium and interest for a total payment of $482,706,000. The remaining 2024 NOK Bonds totaling $20,600,000 will mature on February 5, 2024. On May 22, 2023, as a result of having repurchased more than 90% of the outstanding 2026 NOK Bonds, the Company exercised its option to repurchase all remaining outstanding 2024 and 2026 NOK Bonds from holders. The repurchase, representing a payment of $25,700,000, will occur on February 5, 2024.

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

8.Long-term debt (continued):

(d)On March 28, 2023, in connection with the Merger (note 1), the Company entered into a supplemental indenture with respect to the Company’s exchangeable notes (“Exchangeable Notes”) issued in December 2020. Atlas’ common shares were de-listed on April 10, 2023, triggering a “Make-Whole Fundamental Change”. Under the terms of the supplemental indenture, the holders of the Exchangeable Notes had the right to exchange each $1,000 principal amount of such Exchangeable Note into a number of units based on a defined exchange rate. In connection with the Make-Whole Fundamental Change, each holder had the right, at its option, to exchange all or any portion of its Exchangeable Notes at any time from during the make-whole exchange period at an increased exchange rate on account of a Make-Whole Fundamental Change. During the make-whole exchange period, which ended on May 22, 2023, all of the outstanding Exchangeable Notes were exchanged by the Holders representing a total settlement of $253,139,000.

(e)Credit facilities – other:

As of June 30, 2023, the Company’s credit facilities were secured by first-priority mortgages granted on 53 of its vessels, together with other related security. The security for each of the Company’s current secured credit facilities may include:

•A first priority mortgage on the collateral vessels funded by the related credit facility;

•A pledge or charge over the shares of each entity (other than Seaspan) that owns a collateral vessel;

•An assignment of the Company’s time charters and earnings related to the related collateral vessels;

•An assignment of the insurance on each of the vessels that are subject to a related mortgage;

•An assignment of the Company’s related shipbuilding contracts and the corresponding refund guarantees;

•A pledge over shares of various subsidiaries; and

•A pledge over the related retention accounts

As at June 30, 2023, $1,165,929,000 principal amount of indebtedness under one of the Company’s term loan and revolving credit facilities, together with $1,000,000,000 of sustainability-linked fixed rate notes with maturities from June 2031 to September 2037, was secured by a portfolio of 48 vessels, the composition of which can be changed and is subject to a borrowing base and portfolio concentration requirements, as well as compliance with financial covenants and certain negative covenants.

The Company may prepay certain amounts outstanding without penalty, other than breakage costs in certain circumstances. A prepayment may be required as a result of certain events, including without limitation the sale or loss of a vessel, a termination or expiration of a charter (and the inability to enter into a replacement charter acceptable to lenders within a prescribed period of time). The amount that must be prepaid may be calculated based on the loan to market value. In these circumstances, valuations of the Company’s vessels are conducted on a “without charter” basis as required under the credit facility agreement.

Each credit facility contains a mix of financial covenants requiring the Company to maintain minimum liquidity, tangible net worth, interest and principal coverage ratios and/or debt to assets ratios, as defined.

Certain facilities are guaranteed by an intermediate parent entity, in which case the parent entity must meet certain consolidated financial covenants under those term loan facilities including maintaining certain minimum tangible net worth, cash requirements and debt-to-asset ratios.

Some of the facilities also have an interest and principal coverage ratio, debt service coverage and vessel value requirement for the subsidiary borrower. The Company was in compliance with these covenants as at June 30, 2023.

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

9.Other financing arrangements:


	June 30, 2023		December 31, 2022
Other financing arrangements	$	3,129.4	$	2,119.7
Deferred financing fees	(41.6)		(31.9)
Other financing arrangements	3,087.8		2,087.8
Current portion of other financing arrangements	(203.7)		(147.5)
Other financing arrangements	$	2,884.1	$	1,940.3

The weighted average rate of interest, including the margin, was 7.3% at June 30, 2023 (December 31, 2022 – 6.6%).

Based on amounts funded, payments due to the counterparties are as follows:


Remainder of 2023	$	100.9
2024	211.4
2025	209.9
2026	209.1
2027	211.5
Thereafter	2,186.6
	$	3,129.4

During the six months ended June 30, 2023, the Company received proceeds of $1,082,686,000 related to the delivery of seven vessels and pre-delivery financing for vessels under construction.

10.Supplemental cash flow information


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2023		2022		2023		2022

Interest paid	$	83.2	$	44.9	$	177.0	$	99.1
Interest received	4.5		0.3		6.4		0.3
Undrawn credit facility fee paid	3.9		4.7		9.4		11.0
Non-cash investing and financing transactions:






Change in right-of-use assets and operating lease liabilities	—		64.2		—		97.1
Reclassification from finance lease to vessel	(64.2)		—		(97.1)		—

The Company did not have any restricted cash in either reporting period presented.

11.Revenue:

For the three and six months ended June 30, 2023 and 2022, revenue consists of:


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2023		2022		2023		2022
Time charter revenue	$	376.1	$	354.5	$	736.9	$	721.9
Interest income from leasing	19.1		18.3		38.2		34.4



Other	8.2		6.0		16.6		9.7

	$	403.4	$	378.8	$	791.7	$	766.0

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

11.Revenue (continued):

At June 30, 2023, the minimum future revenues to be received on committed operating leases and interest income to be earned from direct financing leases are as follows:


	Operating lease (1)		Finance lease (2)		Total committed revenue
Remainder of 2023	$	852.9	$	37.9	$	890.8
2024	1,699.6		72.4		1,772.0
2025	1,442.8		69.1		1,511.9
2026	1,198.4		66.7		1,265.1
2027	748.4		64.2		812.6
Thereafter	1,332.0		458.7		1,790.7
	$	7,274.1	$	769.0	$	8,043.1

(1)Minimum future operating lease revenue includes payments from signed charter agreements on operating vessels that have not yet commenced.

(2)Minimum future interest income includes direct financing leases currently in effect.

Minimum future revenues assume 100% utilization, extensions only at the Company’s unilateral option and no renewals. It does not include signed charter agreements on undelivered vessels.

12.Commitments and contingencies:

(a)Operating leases:

At June 30, 2023, the commitment under operating leases for vessels is $525,280,000 for the years from 2023 to 2029 and for other operating leases is $2,440,000 for the years from 2023 to 2025. Total commitments under these leases are as follows:


Remainder of 2023	$	59.2
2024	117.0
2025	120.8
2026	119.2
2027	81.1
Thereafter	30.4
	$	527.7

For operating leases indexed to benchmark rates, commitments under these leases are calculated using the LIBOR in place as at June 30, 2023 for the Company.

(b)Vessel commitment:

As of June 30, 2023, the Company had entered into agreements to acquire 51 vessels (December 31, 2022 – 58 vessels).

The Company has outstanding commitments for installment payments as follows:


Remainder of 2023	$	1,443.7
2024	2,788.4
Total	$	4,232.1

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

13.Financial Instruments

(a)Fair value:

The carrying values of cash and cash equivalents, short-term investments, restricted cash, accounts receivable, accounts payable and accrued liabilities approximate their fair values because of their short term to maturity.

As of June 30, 2023, the fair value of the Company’s revolving credit facilities and term loans excluding deferred financing fees was $1,272,779,000 (December 31, 2022 – $1,066,480,000) and the carrying value was $1,373,521,000 (December 31, 2022 – $1,132,488,000). As of June 30, 2023, the fair value of the Company’s other financing arrangements, excluding deferred financing fees, was $2,924,668,000 (December 31, 2022 – $2,061,863,000) and the carrying value was $3,129,406,000 (December 31, 2022 – $2,119,657,000). The fair value of the revolving and term loan credit facilities and other financing arrangements, excluding deferred financing fees, are estimated based on expected principal repayments and interest, discounted by relevant forward rates plus a margin appropriate to the credit risk of the Company. Therefore, the Company has categorized the fair value of these financial instruments as Level 2 in the fair value hierarchy.

As of June 30, 2023, the fair value of the Company’s senior unsecured notes was $750,008,000 (December 31, 2022 – $1,230,621,000) and the carrying value was $775,700,000 (December 31, 2022 – $1,250,000,000). The fair value of the Company’s Exchangeable Notes was nil (December 31, 2022 – $195,478,000) and the carrying value was nil (December 31, 2022 – $201,250,000). The fair value of the Company’s Senior Secured Notes was $937,096,000 (December 31, 2022 – $937,455,000) and the carrying value was $1,000,000,000 (December 31, 2022 – $1,000,000,000). The fair value is calculated using the present value of expected principal repayments and interest discounted by relevant forward rates plus a margin appropriate to the credit risk of the Company. As a result, these amounts are categorized as Level 2 in the fair value hierarchy.

The Company’s interest rate derivative financial instruments are re-measured to fair value at the end of each reporting period. The fair values of the interest rate derivative financial instruments have been calculated by discounting the future cash flow of both the fixed rate and variable rate interest rate payments. The discount rate was derived from a yield curve created by nationally recognized financial institutions adjusted for the associated credit risk. The fair values of the interest rate derivative financial instruments are determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. Therefore, the Company has categorized the fair value of these derivative financial instruments as Level 2 in the fair value hierarchy.

SEASPAN CORPORATION

Notes to Interim Consolidated Financial Statements

(Unaudited)

(Tabular amounts in millions of United States dollars)

13.Financial Instruments (continued):

(b)Interest rate swap derivatives:

As of June 30, 2023, the Company had the following outstanding interest rate derivatives:


Fixed per annum rate swapped for benchmark rate	Notional amount as of June 30, 2023		Maximum notional amount(1)		Effective date	Ending date
1.7574%	$	500.0	$	500.0	January 31, 2022	February 2, 2032
5.4200%	216.8		216.8		September 6, 2007	May 31, 2024
2.3875%	200.0		200.0		July 20, 2022	July 20, 2032
1.5580%	90.0		90.0		November 14, 2019	May 15, 2024
0.6325%	80.0		80.0		January 21, 2021	October 14, 2026
0.4590%	80.0		80.0		February 4, 2021	October 14, 2026
1.4340%	80.0		80.0		September 27, 2019	May 14, 2024
1.4900%	23.0		23.0		February 4, 2020	December 30, 2025

(1)Over the term of the interest rate swaps, the notional amounts increase and decrease. These amounts represent the peak notional amount over the remaining term of the swap.

If interest rates remain at their current levels, the Company expects that $37,537,000 would be received in cash, respectively, in the next 12 months on interest rate swaps maturing after June 30, 2023. The amount of the actual settlement may be different depending on the interest rate in effect at the time settlements are made.

On March 28, 2023, the Company terminated the capped call and as a result the Company recognized a gain of $30,959,000 upon settlement of the capped called derivative asset and derivative embedded exchange feature (note 8(d)).

14.Subsequent events:

(a)In July 2023, the Company sold one 4,250 TEU vessel for gross proceeds of $26,000,000 and recognized a gain on sale of $5,028,000.

ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

The following should be read in conjunction with the unaudited consolidated financial statements and related notes for the quarter ended June 30, 2023 included in this Report and the audited consolidated financial statements and related notes for the year ended December 31, 2022 filed with the U.S. Securities and Exchange Commission on an Atlas Corp. Form 6-K (“Seaspan Annual Filing”). Unless otherwise indicated, all amounts are presented in U.S. dollars, or USD. We prepare our consolidated financial statements in accordance with U.S. GAAP.

Overview

General

Seaspan was incorporated on May 3, 2005, in the Republic of the Marshall Islands. Seaspan is a leading independent charter owner and manager of containerships, which we charter primarily pursuant to long-term, fixed-rate time charters with eight major container liner companies, of which three customers each contributed over 10% of total revenue for the three months ended June 30, 2023. We primarily deploy our vessels on long-term, fixed-rate time charters to take advantage of the stable cash flow and high utilization rates that are typically associated with long-term time charters. As of June 30, 2023, we operated a fleet of 139 vessels that have an average age of approximately eight years, on a TEU weighted basis. As at June 30, 2023, we have 51 newbuild vessels under construction delivering through to December 2024.

Our primary objective for Seaspan is to continue to grow our containership leasing business through accretive vessel acquisitions as market conditions allow. Most of our customers’ containership business revenues are derived from the shipment of goods from the Asia Pacific region to various overseas export markets in the United States and in Europe.

We use the term “twenty-foot equivalent unit”, or TEU, the international standard measure of containers, in describing the capacity of our containerships, which are also referred to as our “vessels”.

The following table summarizes key facts regarding Seaspan’s fleet as of June 30, 2023:


	Operating Vessels					Newbuild Vessels
Vessel Class (TEU)	# Vessels	# Vessels (of which are unencumbered)	Average Age (Years)	Average Remaining Charter Period (Years)(1)	Average Daily Charter Rate (in thousands of USD)	# Vessels	Average Length of Charter
2,500-3,500	14	6	15.1	1.5	16.0	—	—
4,250-5,100(2)	20	13	14.8	2.8	32.1	—	—
7,000	—	—	—	—	—	20	11.2
8,100-9,600(3)	20	13	13.6	2.4	36.7	—	—
10,000-11,000(4)	33	7.0	7.7	3.5	32.8	—	—
11,800-13,400(5)	27	—	6.2	6.1	39.5	—	—
14,000-15,000	24	2.0	4.8	5.2	46.9	—	—
15,000-16,000	1	—	—	—	—	29	10.8
24,000	—	—	—	—	—	2	18.0
Total/Average	139	41	8.0	4.0	35.4	51	11.2

(1)Excludes options to extend charter

(2)Includes 1 asset held for sale

(3)Includes 3 vessels on bareboat charter

(4)Includes 8 vessels on bareboat charter

(5)Includes 6 vessels on bareboat charter

In addition, our joint venture with Zhejiang Energy Group has five operating vessels as at June 30, 2023 and we are the ship manager for all five vessels.

Significant Developments During the Quarter Ended June 30, 2023 and Subsequent

Containership Developments

During the second quarter of 2023, the Company took delivery of six vessels ranging from 15,000 TEU to 15,500 TEU newbuild vessels, each of which commenced a long-term charter upon delivery. The Company also accepted delivery of two second-hand vessels in June 2023 which are on charter with minimum terms ending in the second half of 2025.

In June 2023, Seaspan completed the sale of one 4,250 TEU vessel for gross proceeds of $17.3 million. In July 2023, Seaspan completed the sale of an additional 4,250 TEU vessel for gross proceeds of $26.0 million. Seaspan continues to serve as a third-party vessel manager for both vessels.

Financing Developments

During the quarter ended June 30, 2023, the Company exchanged all outstanding Exchangeable Notes, and repurchased some of its 2024 NOK bonds and 2026 NOK Bonds. For more information, please review “Liquidity and Capital Resources” below.

Dividends

On June 29, 2023, the Company declared dividends of $30.0 million on its common shares to Atlas which were paid on June 30, 2023.

Poseidon Acquisition of Atlas or Closing of Merger with Poseidon Acquisition Corp.

On March 28, 2023, pursuant to the Merger Agreement entered into among Atlas, Poseidon and Merger Sub, the Merger was consummated, whereby Merger Sub merged with and into Atlas with Atlas continuing as the surviving corporation and a wholly-owned subsidiary of Poseidon (other than with respect to Atlas’ preferred shares). In connection with the consummation of the Merger, the Atlas’ Common Shares were removed from listing from the New York Stock Exchange (“NYSE”) on April 10, 2023. Shares of preferred stock of Atlas issued and outstanding immediately prior to the Effective Time have not been affected by the Merger and remain outstanding and continue to trade on the NYSE.

Changes in Senior Management

In July 2023, Graham Talbot resigned as Chief Financial Officer of Atlas and Seaspan. Bing Chen was appointed as interim Chief Financial Officer of Atlas and Seaspan, effective July 7, 2023.

In June 2023, Peter Curtis resigned as Chief Commercial Officer of Seaspan and in June 2023 Kun Li was appointed Chief Commercial Officer of Seaspan.

Results of Operations

For the three and six months ended June 30, 2023, compared with the three and six months ended June 30, 2022

The following tables summarize Seaspan’s consolidated financial results for the three and six months ended June 30, 2023.


Consolidated Financial Summary (in millions of U.S. dollars)	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2023		2022		2023		2022
Revenue	$	403.4	$	378.8	$	791.7	$	766.0
Ship operating expense	84.6		77.6		164.8		152.6
Depreciation and amortization expense	89.7		81.5		174.0		159.9
General and administrative expense	14.4		11.5		33.0		23.7
Operating lease expense	29.7		29.0		58.9		61.9
Loss on sale of vessels	0.6		2.0		1.1		4.0
Operating earnings	184.4		177.2		359.9		363.9
Interest expense	82.0		46.5		162.2		87.4
Net earnings	120.8		160.6		177.0		337.1
Cash from operating activities	263.2		219.1		480.0		409.9

Asset Utilization

Vessel Utilization represents the number of ownership days on-hire as a percentage of total ownership days, including bareboat ownership days. The following table summarizes Seaspan’s vessel utilization for the last eight consecutive quarters:


	2021						2022								2023
	Q2		Q3		Q4		Q1		Q2		Q3		Q4		Q1		Q2








Vessel Utilization	98.5	%	98.6	%	98.5	%	98.5	%	98.3	%	98.6	%	98.5	%	97.6	%	95.2	%

Vessel utilization decreased for the three and six months ended June 30, 2023, compared with the same period in 2022 respectively. The decrease was primarily due to an increase in the number of scheduled dry-docking and associated off-hire days.

Financial Results Summary

Revenue

Revenue increased by 6.5% to $403.4 million and by 3.4% to $791.7 million for the three and six months ended June 30, 2023, respectively, compared with the same period in 2022. The increases in revenue were primarily due to 12 newbuild vessel deliveries after June 30, 2022, offset by nine vessel sales and higher scheduled off-hire days in the current period.

Operating Expense

Operating expense increased by 9.0% to $84.6 million and by 8.0% to $164.8 million for the three and six months ended June 30, 2023, respectively, compared with the same periods in 2022. The increase was primarily due to growth in our fleet of operating vessels.

Depreciation and Amortization Expense

Depreciation and amortization expense increased by 10.1% to $89.7 million and by 8.8% to $174.0 million for the three and six months ended June 30, 2023, respectively, compared with the same period in 2022. The increases were primarily due to the growth in our fleet of operating vessels and purchase options being exercised for three vessels in January and April 2022 which resulted in a reclassification of the leases from operating to financing.

General and Administrative Expense

General and administrative expense increased by 25.2% to $14.4 million and by 39.2% to $33.0 million for the three and six months ended June 30, 2023, respectively, compared with the same period in 2022. The increases for the three and

six months ended June 30, 2023 were primarily attributable to an increase in general corporate expenses including share-based compensation.

Operating Lease Expense

Operating lease expense increased by 2.4% to $29.7 million for the three months ended June 30, 2023 and decreased by 4.8% to $58.9 million for the six months ended June 30, 2023, compared with the same period in 2022. The increase for the three months ended June 30, 2023, was due to increases in benchmark rates. The decrease for the six months ended June 30, 2023 was primarily due to the lease reclassification from operating to financing as a result of pre-existing purchase options being exercised in January and April 2022 for three vessels, partially offset by increases in benchmark rates on the remaining operating leases.

Interest Expense and Amortization of Deferred Financing Fees

Interest expense increased by 76.3% to $82.0 million and by 85.6% to $162.2 million for the three and six months ended June 30, 2023, respectively, compared with the same period in 2022. The increase is primarily driven by an increase in benchmark rates on our debt facilities and other financing arrangements.

Gain on Derivative Instruments

The change in fair value of derivative instruments resulted in a gain of $29.3 million and $18.2 million for the three and six months ended June 30, 2023, respectively. The gains for these periods were primarily due to an increase in the forward curve of the benchmark rates and offset by swap settlements. Based on the current notional amount and tenor of our interest rate swap portfolio, a one percent parallel shift in the overall yield curves is expected to result in a change in the fair value of our interest rate swaps of approximately $106.2 million.

Our fair value instruments, including interest rate swaps were marked to market with all changes in the fair value of these instruments recorded in “Change in fair value of financial instruments” in our Interim Consolidated Statement of Operations.

Please read “Item 3. Quantitative and Qualitative Disclosures About Market Risk” in Seaspan’s Annual Filing for additional information.

Liquidity and Capital Resources

Liquidity

As at quarter ended June 30, 2023, we have total liquidity of $726.0 million, consisting of $156.0 million of cash and cash equivalents, $570.0 million of undrawn commitments under available revolving credit facilities. Our primary short-term liquidity needs are to fund our operating expenses, investments in assets including vessels under construction, debt repayments, lease payments, swap settlements, payment of quarterly dividends and payments on our other financing arrangements. Our medium-term liquidity needs primarily relate to debt repayments, vessel purchase commitments, lease payments and payments on our other financing arrangements. Our long-term liquidity needs primarily relate to potential future acquisitions, lease payments, debt repayments including repayment of our notes, payments on our other financing arrangements and dividends to Atlas from time to time. Please read note 8 “Long-term debt” and note 9 “Other financing arrangements” in our interim Consolidated Financial Statements for additional information.

We anticipate that our primary sources of funds for our short-term liquidity needs will be cash from operations, and existing and new credit facilities and other financing arrangements. We anticipate our medium and long-term sources of funds will be from cash from operations, new credit facilities, lease facilities and capital markets financings to the extent available.

The following table summarizes our liquidity as of June 30, 2023 and December 31, 2022:


(in millions of US dollars)	June 30,		December 31,		Change
	2023		2022		$		%
Cash and cash equivalents	$	156.0	$	150.7	$	5.3	3.5	%
Undrawn revolving credit facilities	570.0		650.0		(80.0)		(12.3)	%
Total liquidity	726.0		800.7		(74.7)		(9.3)	%
Total committed and undrawn newbuild financings	4,976.9		6,120.9		(1,144.0)		(18.7)	%
Total liquidity including newbuild financings	$	5,702.9	$	6,921.6	(1,218.7)		(17.6)	%

As of June 30, 2023, the Company’s liquidity was sufficient to meet near-term requirements. As of June 30, 2023 the Company had consolidated liquidity of $726.0 million, excluding $4,976.9 million of committed but undrawn financings related to our newbuild vessels, which represents a decrease from $800.7 million compared to December 31, 2022. The exercise period during which the holders of the 2024 NOK Bonds and 2026 NOK Bonds had the right to require the Company to purchase some or all of the bonds held by such holders ended on May 3, 2023. A total of $482.7 million was settled on May 10, 2023 of which $179.4 million and $294.9 million relates to the 2024 NOK Bonds and 2026 NOK Bonds, respectively. The remaining 2024 NOK Bonds will mature on February 5, 2024. The Company will repurchase all remaining 2026 NOK Bonds from holders on February 5, 2024. The total payment reflects a price equal to 101% of the principal amount plus accrued interest. During the make-whole exchange period, which ended on May 22, 2023, all of the outstanding Exchangeable Notes were exchanged by the Holders representing a total settlement of $253.1 million.

Unencumbered Assets

The Company’s growing base of unencumbered assets is a fundamental objective to achieving an investment grade credit rating, as well as a potential source of liquidity through secured financing or asset sales. Over the long-term, the Company expects its unencumbered asset base to grow as it enhances its presence in the unsecured credit markets, and also naturally as secured borrowings mature or are prepaid.

In the short-term, the Company expects that it’s unencumbered asset base may fluctuate as unencumbered assets may be sol

SEC Form 6-K filed by Atlas Corp.