Contract analysis

I. PRELIMINARY STATEMENT Thalassa Americas Inc. ("TAI" or the "Debtor"), a Delaware C-Corporation and wholly-owned subsidiary of Thalassa Shipping & Logistics Société Anonyme ("TSL"), a Greek société anonyme, by and through its proposed counsel, Calderwood & Harkness LLP, hereby files this motion (the "Motion") pursuant to sections 105(a), 345(b), 363(c), and 364(a) of title 11 of the United States Code, 11 U.S.C. §§

II. JURISDICTION AND VENUE This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334 and the Amended General Order of Reference from the United States District Court for the Southern District of Texas, dated October 16, 2013. This is a core proceeding under 28 U.S.C. § 157(b)(2). Venue is proper in the Southern District of Texas, Houston Division, pursuant to 28 U.S.C. §§ 1408 and 1409, becau

III. BACKGROUND A. The Debtor and Its Business TAI is a Delaware C-Corporation and the wholly-owned subsidiary of TSL, a Greek société anonyme organized under Hellenic law and registered with the Athens General Commercial Registry (Genikó Emporikó Mitróo). TSL is headquartered at 42 Akti Miaouli, Piraeus 18538, Greece, and is a privately held, family-controlled international shipping and logistics company. TSL was fo

1. Senior Secured Credit Facility TSL and TAI are parties to a Senior Secured Credit Agreement dated as of June 15, 2019 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among TSL (as borrower), TAI (as co-borrower with respect to the U.S. Tranche), Nordbank International AG ("Nordbank"), with offices at Bahnhofstrasse 78, 8001 Zürich, Switzerland, as administrati

2. Mezzanine Notes TSL issued $100 million in mezzanine notes (the "Mezzanine Notes") to Dralvecen Mezzanine Capital LLC ("BMC"), bearing interest at a rate of 11.5% per annum on a PIK toggle basis. Since the second quarter of 2022, all interest has been paid in kind ("PIK"), resulting in capitalized PIK interest of approximately $12.3 million as of September 30, 2022, for a total outstanding balance of approximately

3. Unsecured Notes TSL issued $50 million in aggregate principal amount of 8.25% Senior Unsecured Notes (the "Unsecured Notes"), with semi-annual interest payments due on June 1 and December 1 of each year, maturing on March 1, 2025. Garrison Trust Company, located at 100 Wall Street, 16th Floor, New York, New York 10005, serves as the indenture trustee under the indenture governing the Unsecured Notes. The Unsecured

4. Intercompany Note TAI owes TSL $76.4 million under a subordinated intercompany promissory note (the "Intercompany Note") bearing interest at a rate of 5.0% per annum. The Intercompany Note is subordinated to all obligations under the Credit Agreement and the Mezzanine Notes, and periodic interest payments have historically flowed from TAI to TSL. The Debtor will seek appropriate treatment of this subordinated obli

5. Trade Payables As of the anticipated Petition Date, TAI's outstanding trade payables total approximately $38.7 million. The largest trade creditor is Olympian Fuel & Supply SA, a Piraeus-based bunker fuel supplier, to which TAI owes approximately $9.2 million. Other significant trade creditors include port services providers, equipment lessors, insurance brokers, and logistics vendors.

6. Summary of Total Funded Indebtedness Note: Accrued but unpaid interest not included. Total funded debt across all facilities (excluding trade payables and the subordinated intercompany note) is approximately $702.3 million; including all obligations the total approximates $847.3 million when accrued interest and minor other liabilities are included. C. Events Leading to the Chapter 11 Filing The circumstances that

IV. THE DEBTOR'S CASH MANAGEMENT SYSTEM A. Overview of the Cash Management System The Cash Management System is the critical financial infrastructure through which TAI conducts all of its U.S. business operations. The system was established at the time of TAI's formation as the U.S. operating subsidiary of TSL and has been in continuous operation since that time. It is deeply integrated with the global cash managemen

1. Operating Account (Main) (Account No. XXXX-XXXX-4781). This is TAI's primary operating account, used for the receipt of customer payments from Houston terminal operations (including wharfage fees, dockage charges, stevedoring fees, and storage charges), freight brokerage commissions, and vessel scheduling revenues. The Operating Account also serves as the primary disbursement account for operational expenses, incl

2. Payroll Account (Account No. XXXX-XXXX-6203). This is a dedicated account used exclusively for bi-weekly payroll processing for TAI's approximately 680 U.S. employees. Disbursements from the Payroll Account include wages, salaries, benefits withholdings (health insurance, 401(k) contributions, and other employee benefit deductions), and payroll tax remittances (including FICA, federal income tax withholding, and s

3. Tax Escrow Account (Account No. XXXX-XXXX-8517). This account holds funds designated for federal, state, and local tax obligations, including IRS withholding deposits, estimated federal and state income tax payments, Texas franchise tax obligations, and port authority fees assessed by the Port of Houston Authority. Funds are periodically transferred from the Operating Account to the Tax Escrow Account to ensure th

4. Vendor Disbursement Account (Account No. XXXX-XXXX-3945). This account is used for payment of trade creditors and vendors. As of the anticipated Petition Date, TAI has approximately $38.7 million in outstanding trade payables, including payments due to key suppliers such as Olympian Fuel & Supply SA (bunker fuel, $9.2 million), as well as other bunker fuel suppliers, port services providers, equipment lessors, ins

5. Concentration Account (Account No. XXXX-XXXX-1162). This account serves as a centralized liquidity management vehicle. Excess funds from the Operating Account are swept into the Concentration Account on a daily or periodic basis for purposes of centralized cash management and investment. Historically, the Concentration Account has also been used for intercompany transfers to TSL's centralized treasury in Piraeus,

V. INTERCOMPANY TRANSACTIONS A. Overview of Intercompany Relationships TAI is a wholly-owned subsidiary of TSL. The two entities are operationally integrated, and routine intercompany transactions in the ordinary course of business are essential to the functioning of both companies. TAI's Houston terminal operations depend on the scheduling of TSL's global fleet of 50 vessels, and TSL's transatlantic trade lanes depe

1. Intercompany Management and Services Fees TAI and TSL provide management and support services to each other on a reciprocal basis, with fees charged at arm's-length rates consistent with historical practice. Specifically: (a) TAI pays TSL for centralized management services provided by TSL's Piraeus-based staff, including: global chartering and commercial management; information technology systems and support; cen

2. Revenue Sharing / Chartering Allocations Portions of global chartering revenue allocable to U.S.-originated freight are transferred from TSL to TAI under an intercompany revenue-sharing arrangement. These allocations reflect TAI's contribution to the origination, scheduling, and documentation of cargo moving on TSL's vessels to and from the Houston terminal. Conversely, TAI remits certain commissions and schedulin

3. Intercompany Note Servicing As described above, TAI owes TSL $76.4 million under the Intercompany Note, a subordinated intercompany promissory note bearing interest at 5.0% per annum. Periodic interest payments on the Intercompany Note have historically flowed from TAI to TSL, amounting to approximately $3.82 million per year ($76.4 million × 5.0%). The Debtor acknowledges that the Intercompany Note is subordinate

4. Cost Reimbursements TAI and TSL routinely reimburse each other for shared costs incurred in connection with their integrated operations. Categories of reimbursable costs include: vessel-related expenses incurred by TAI on behalf of TSL (such as port charges, pilotage, and tug fees at the Houston terminal); bunker fuel costs (particularly payments to Olympian Fuel & Supply SA and other fuel suppliers, which may be

5. Centralized Treasury / Cash Pooling Historically, excess cash from TAI's Concentration Account has been swept to TSL's centralized treasury in Piraeus as part of TSL's global cash management and liquidity optimization program. Similarly, TSL has at times funded TAI's operational needs from centralized liquidity when TAI has experienced temporary cash shortfalls, particularly during periods of seasonal or cyclical

VI. BASIS FOR RELIEF A. Sections 105(a) and 363(c) — Continuation of Cash Management System Under section 363(c)(1) of the Bankruptcy Code, the debtor-in-possession "may enter into transactions, including the sale or lease of property of the estate, in the ordinary course of business, without notice or a hearing, and may use property of the estate in the ordinary course of business without notice or a hearing." 11 U.

Section 105(a) of the Bankruptcy Code grants the Court broad equitable authority to "issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of [the Bankruptcy Code]." 11 U.S.C. § 105(a). Maintaining the Cash Management System is necessary and appropriate to preserve the Debtor's ability to operate, maintain employee morale, honor contractual obligations, and preserve the go

Section 345(b) of the Bankruptcy Code requires that deposits of money of the estate "not be made in a depository unless such depository is an insured depository" and, in certain circumstances, that such deposits be "secured by the bond of a depository" or "otherwise secured." 11 U.S.C. § 345(b). The Debtor's bank accounts are maintained at Gulf Maritime National Bank, N.A., a nationally chartered bank insured by the

Section 364(a) of the Bankruptcy Code provides that "[i]f the trustee is authorized to operate the business of the debtor under section 721, 1108, 1183, 1184, 1203, 1204, or 1304 of this title, unless the court orders otherwise, the trustee may obtain unsecured credit and incur unsecured debt in the ordinary course of business allowable under section 503(b)(1) of this title as an administrative expense." 11 U.S.C. §

VII. REQUEST FOR INTERIM AND FINAL RELIEF The Debtor requests entry of the proposed interim order (attached hereto as Exhibit A) granting the relief described herein on an interim basis, effective immediately upon entry, pursuant to Bankruptcy Rule 6003, which permits the Court to grant relief within the first twenty-one (21) days of a bankruptcy case "to the extent that relief is necessary to avoid immediate and irr

VIII. WAIVER OF BANKRUPTCY RULES 6004(a) AND 6004(h) The Debtor respectfully requests a waiver of the fourteen (14) day stay imposed by Bankruptcy Rule 6004(h), which provides that "[a]n order authorizing the use, sale, or lease of property other than cash collateral is stayed until the expiration of 14 days after entry of the order, unless the court orders otherwise." Fed. R. Bankr. P. 6004(h). The Debtor submits th

IX. NOTICE Notice of this Motion has been provided to the following parties (or their counsel): (a) The Office of the United States Trustee for the Southern District of Texas, 515 Rusk Street, Suite 3516, Houston, Texas 77002; (b) Nordbank International AG, as administrative agent and collateral agent under the Credit Agreement, at Bahnhofstrasse 78, 8001 Zürich, Switzerland (Attn: Henrik Lüdemann, Managing Director

X. NO PRIOR REQUEST No prior request for the relief sought in this Motion has been made to this or any other court.

XI. CONCLUSION AND PRAYER FOR RELIEF WHEREFORE, the Debtor respectfully requests that the Court enter the proposed interim order, substantially in the form attached hereto as Exhibit A, and, following a final hearing on notice, the proposed final order, substantially in the form attached hereto as Exhibit B: (a) Authorizing the Debtor to continue operating its existing Cash Management System, substantially in the man

1. Office of the United States Trustee for the Southern District of Texas, 515 Rusk Street, Suite 3516, Houston, Texas 77002;

2. Nordbank International AG (Attn: Henrik Lüdemann), Bahnhofstrasse 78, 8001 Zürich, Switzerland;

3. Whitfield, Crane & Burgess LLP (Attn: Graham Whitfield III, Esq.), 51 West 52nd Street, 38th Floor, New York, New York 10019;

4. Kellner & Foss LLP (Attn: Theodore Kellner, Esq.), 1185 Avenue of the Americas, 30th Floor, New York, New York 10036;

5. Ashford, Brightmoor Group & McKay PC (Attn: Carolyn Brightmoor Group, Esq.), 299 Park Avenue, 18th Floor, New York, New York 10171;

6. Garrison Trust Company, 100 Wall Street, 16th Floor, New York, New York 10005;

7. The Debtor's thirty (30) largest unsecured creditors; and

8. All parties that have filed a request for notice pursuant to Bankruptcy Rule 2002. ________________________________________ Amy Chesterton CALDERWOOD & HARKNESS LLP EXHIBIT A PROPOSED INTERIM ORDER UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION In re: THALASSA AMERICAS INC., Debtor. Case No. __-_ (to be assigned) Chapter 11 INTERIM ORDER (I) AUTHORIZING THE DEBTOR TO CONTINUE TO OPERATE

1. Continuation of Cash Management System. The Debtor is authorized, but not directed, to continue operating the Cash Management System in the ordinary course of business, substantially in the manner maintained prior to the Petition Date and as described in the Motion.

2. Maintenance of Bank Accounts. The Debtor is authorized to maintain all existing bank accounts at Gulf Maritime National Bank, N.A., including the following: (a) Operating Account (Main) (Account No. XXXX-XXXX-4781); (b) Payroll Account (Account No. XXXX-XXXX-6203); (c) Tax Escrow Account (Account No. XXXX-XXXX-8517); (d) Vendor Disbursement Account (Account No. XXXX-XXXX-3945); and (e) Concentration Account (Accou

3. Existing Business Forms. The Debtor is authorized to continue using existing checks, business forms, letterhead, purchase orders, invoices, and other business forms in their current format for a period of sixty (60) days following the Petition Date, or until entry of a final order on the Motion, whichever is earlier, after which the Debtor shall use forms bearing the designation "Debtor-in-Possession" or "DIP." Du

4. Intercompany Transactions. The Debtor is authorized to continue ordinary-course intercompany transactions with TSL and non-debtor affiliates, subject to the following Intercompany Safeguards: (a) The Debtor shall maintain detailed intercompany ledgers with real-time tracking of all intercompany transfers, including the date, amount, direction, category, and supporting documentation for each transaction; (b) All in