Contract analysis

ARTICLE I DEFINITIONS AND INTERPRETATION

Section 1.01 — Definitions. As used in this Agreement, the following terms shall have the meanings set forth below: "Ad Hoc Group" means the ad hoc group of senior secured lenders comprising Nordbank International AG, Harborstone Bank plc, Triton Credit Partners LP, and Continental Maritime Lending GmbH, holding collectively $372,000,000, or approximately 54.3%, of the aggregate commitments under the Senior Secured C

Section 1.02 — Rules of Interpretation. Unless the context otherwise requires, the following rules of interpretation shall apply to this Agreement: (a) The headings and captions contained in this Agreement are included for convenience of reference only and shall not affect the interpretation of this Agreement. (b) References to "this Agreement," "herein," "hereof," "hereunder," and words of similar import refer to th

ARTICLE II RESTRUCTURING TRANSACTIONS

Section 2.01 — Senior Secured Facility Amendment. The following amendments to the Credit Agreement shall be implemented through Amendment No. 1, which shall be a Definitive Document in form and substance reasonably acceptable to the Required Consenting Lenders, the Administrative Agent, and the Company Parties: (a) Maturity Extension. The maturity date of all tranches under the Credit Agreement (TLA, Revolver, and TL

Section 2.02 — Mezzanine Exchange. (a) Exchange Terms. On the Closing Date, BMC shall exchange all of its Existing Mezzanine Notes (in the aggregate outstanding principal amount of $112,300,000, including $12,300,000 of PIK interest capitalized to the principal balance) for the following consideration: (i) $60,000,000 in aggregate principal amount of New Second-Lien Notes, bearing interest at 10.0% per annum (payable

Section 2.03 — KFO Equity Contribution. (a) Contribution Amount. On the Closing Date, KFO Holdings SA shall contribute €35,000,000 (approximately $38,200,000 at a EUR/USD exchange rate of €1 = $1.0914 as of the RSA Execution Date) in new equity capital to TSL (the "Equity Contribution"). The actual dollar equivalent of the Equity Contribution shall be determined based on the EUR/USD exchange rate prevailing on the Cl

Section 2.04 — Treatment of Unsecured Notes. (a) No Impairment. The $50,000,000 in aggregate principal amount of 8.25% Senior Unsecured Notes due March 1, 2025 shall remain outstanding and unmodified in accordance with the terms of the indenture governing such Unsecured Notes. The Restructuring Transactions do not contemplate any amendment, modification, or impairment of the rights of the holders of the Unsecured Not

Section 2.05 — Vessel Dispositions. (a) Undertaking. TSL shall use commercially reasonable efforts to sell six (6) older dry-bulk carriers (having an average age of approximately 18 years as of the RSA Execution Date) identified as the Disposition Vessels on Exhibit B, within twelve (12) months following the Closing Date. (b) Estimated Proceeds. Based on the fleet appraisal prepared by Drakos Maritime Valuations Ltd.

Section 2.06 — Intercompany Note Amendment. (a) Principal. The $76,400,000 subordinated intercompany promissory note from TAI (as maker) to TSL (as holder) shall be amended and restated as a Definitive Document to reflect the terms set forth in this Section 2.06. (b) Maturity Extension. The maturity date of the Intercompany Note shall be extended to December 2028. (c) Interest Rate Reduction. The interest rate on the

Section 2.07 — Treatment of Trade Creditors. The Restructuring Transactions do not contemplate any impairment or modification of the claims of trade creditors of TSL or TAI. All trade payables (approximately $38,700,000 in the aggregate as of September 30, 2022) shall continue to be paid in full in the ordinary course of business, in accordance with their respective terms. For the avoidance of doubt, no consent, waiv

ARTICLE III DEFINITIVE DOCUMENTS

Section 3.01 — List of Definitive Documents. The Restructuring Transactions shall be implemented through the execution and delivery of the following documents and instruments (collectively, the "Definitive Documents"), each in form and substance reasonably acceptable to the Required Consenting Lenders, BMC, and the Company Parties (unless otherwise specified):

1. Amendment No. 1 to the Senior Secured Credit Agreement;

2. Amended and Restated Intercreditor Agreement (the New Intercreditor Agreement);

3. New Second-Lien Note Purchase Agreement;

4. New Second-Lien Notes Indenture;

5. Equity Subscription Agreement (between KFO and TSL);

6. Amended and Restated Intercompany Promissory Note (from TAI to TSL);

7. Consent and Waiver Letter (to be delivered by Garrison Trust Company, as Indenture Trustee);

8. Side Letter Agreement: Vessel Disposition Undertaking;

9. Lock-Up Agreement (to be executed by BMC);

10. Joinder Agreements (to be executed by each Consenting Senior Lender);

11. Secretary's Certificate of TAI, attaching certified copies of TAI's certificate of incorporation, bylaws, and resolutions of the board of directors authorizing the Restructuring Transactions;

12. Officer's Certificate of TAI, executed by Marcus Hale, President, certifying as to the satisfaction of certain conditions precedent;

13. Solvency Certificate of TAI, executed by Diana Restrepo, VP Finance, certifying as to the solvency of TAI as of the Closing Date after giving effect to the Restructuring Transactions;

14. Legal opinions of Calderwood & Harkness LLP, addressed to Nordbank (as Administrative Agent) and the Consenting Senior Lenders, opining as to (a) due authorization and enforceability of the Definitive Documents executed by the Company Parties and (b) no conflicts with, or violations of, the organizational documents of the Company Parties, applicable law, or material agreements;

15. Funds Flow Memorandum; and

16. Such other agreements, documents, certificates, or instruments as may be reasonably necessary or appropriate to implement and consummate the Restructuring Transactions.

Section 3.02 — Preparation and Negotiation. The Company Parties, through their legal counsel Calderwood & Harkness LLP, shall be responsible for preparing the initial drafts of all Definitive Documents and shall distribute such drafts to the Consenting Lenders and their respective counsel in accordance with the Milestones set forth in Section 4.04. All Definitive Documents shall be subject to review and comment by Wh

ARTICLE IV COMMITMENTS OF THE PARTIES

Section 4.01 — Commitments of the Company Parties. Subject to the terms and conditions of this Agreement, TSL, TAI, and KFO (collectively, the "Company Parties") hereby covenant and agree as follows: TSL and TAI shall: (a) Negotiate in good faith and use commercially reasonable efforts to prepare, finalize, execute, and deliver all Definitive Documents in accordance with the terms of this Agreement and by the Outside

Section 4.02 — Commitments of the Consenting Senior Lenders. Subject to the terms and conditions of this Agreement, each Consenting Senior Lender hereby covenants and agrees as follows: (a) Execute and deliver a Joinder Agreement substantially in the form attached hereto as Exhibit C, concurrently with or prior to the RSA Execution Date; (b) Vote in favor of, consent to, and otherwise support the approval and impleme

Section 4.03 — Commitments of the Consenting Mezzanine Lender (BMC). Subject to the terms and conditions of this Agreement, BMC hereby covenants and agrees as follows: (a) Execute and deliver the Lock-Up Agreement substantially in the form attached hereto as Exhibit D, concurrently with or prior to the RSA Execution Date; (b) Consent to and participate in the Mezzanine Exchange on the terms set forth in Section 2.02,

Section 4.04 — Milestones. The following milestones shall apply to the implementation of the Restructuring Transactions (each, a "Milestone"): Failure to satisfy any Milestone by the applicable date shall constitute a Termination Event under Section 8.01(c), subject to any extension of such date agreed upon in writing by the Required Consenting Lenders and the Company Parties. Any such extension shall be promptly com

ARTICLE V REPRESENTATIONS AND WARRANTIES

Section 5.01 — Representations and Warranties of the Company Parties. Each of TSL, TAI, and KFO (solely with respect to itself) hereby represents and warrants to each of the other Parties, as of the RSA Execution Date and as of the Closing Date (except where a representation speaks as of a specific date), as follows: (a) Organization and Good Standing. TSL is a société anonyme duly organized, validly existing, and in

Section 5.02 — Representations and Warranties of Each Consenting Lender. Each Consenting Senior Lender, severally and not jointly, hereby represents and warrants to each of the other Parties, as of the RSA Execution Date (or, in the case of a transferee that becomes a Consenting Senior Lender after the RSA Execution Date, as of the date of its execution of a Joinder Agreement), as follows: (a) Organization and Author