American Ship Finance Partners -- Commercial Lending for the Shipping, Aviation and Refineries Industries

In comparison an IPO will take a minimum of five months and can take considerably longer to complete. Also, the issuer’s costs in an IPO are much higher running in the US$2 million range excluding investment banking fees. Corresponding costs for a SPAC are less than US$200.000. Of considerable importance, with an IPO the issuer doesn’t know how much will be raised until the deal gets priced at the end of the process. In an IPO, it is also possible, but rare, that market conditions can turn adverse and postpone or scuttle the entire process. With a SPAC the money is already raised and the valuation set at the outset of the transaction. Also it is very unlikely that the SPAC investors will vote against the acquisition if the SPAC Sponsor is recommending it.

Adventure Holdings/Trinity Acquisition Partners

Poseidon Capital located the SPAC and played a central role in developing their interest and setting the terms of the business combination with Adventure Holdings.

The SPAC is Trinity Partners Acquisition Inc. Ticker symbols: TPQCA, TPQCB, TPQCW, TPQCL. Trinity will have a minimum of US$7 million in cash at closing, plus warrants outstanding which can raise another US$18 million if the share price stays above a certain level for twenty days out of a thirty day period.

At closing Adventure Holdings will control approx 72% of the outstanding shares of the combined entity and after exercise of the warrants their ownership will be reduced to approx. 42%. In addition to the shares the principals of Adventure Holdings will own a total of 950.000 share options.

Adventure Holdings (renamed already FREESEAS, INC.) presently owns three early/mid eighties handy size bulk carriers.

The valuation metrics employed by SPACs are typically based on a multiple of EBITDA. Enterprise value which is equity value or market cap plus debt minus cash will likely be valued in the range of 4-5 X EBITDA. Forward multiples are more relevant especially in your case. This multiple is somewhat below where the public market has been valuing shipping equities. This is to make the acquisition attractive to investors and to develop momentum in the stock in order to get the warrants exercised.

In addition to the foregoing points we would briefly outline how we at American Ship Finance Partners expect to cooperate. First of all, through our U.S. partners we have ready access to a number of already established SPACs (each one of them having already raised capital from US$10 Million to US$40 Million plus warrants). We work with on a retainer plus success fee basis. Typically a retainer will be 4-6 months at at least US$10,000 to US$15,000 per month, with a success fee to be agreed upon based on a percentage of the amount of equity raised. We also work closely with a number of U.S. law firms who are experts of the securities practice there and also experts in this area. Those firms have been instrumental in our involvement in this area and we would expect that they would be retained by a prospective client.

Related Links:

International Shipping Enterprises, Inc. (0001305220)
Star Maritime Acquisition Corp. (0001328307)
Trinity Partners Acquistion CO Inc. (0001289632)

In order to obtain more info about the above-mentioned Companies and their statutory filings with the SEC you may visit the following:

www.sec.gov/edgar/searchedgar/companysearch.html

which is the official site of the U.S. Securities and Exchange Commission and fill up the above Company names into its "Company Name" field. More information and a consultation may be provided after contacting marine@amershipfinancepartners.com.