Contract analysis

I. Executive Summary The purpose of this memorandum is to provide Thalassa Shipping & Logistics SA ("TSL") management with a comprehensive update on the status of discovery, depositions completed and upcoming, document production, expert retention, and strategic recommendations for the remainder of the pretrial phase in the above-captioned litigation. This memorandum covers the period from the commencement of discove

II. Document Production Status A. TSL's Productions TSL has made rolling document productions to Northwind since January 2024, in accordance with the scheduling order and the parties' negotiated discovery protocols. All document review, processing, and production have been coordinated with our e-discovery vendor, Lighthouse Data Analytics Inc. ("Lighthouse"), located at 200 Park Avenue South, 14th Floor, New York, NY

1. Vessel Maintenance Logs and Records. Complete maintenance logs and records for M/V Aegean Fortuna (IMO 9847231, Liberian flag) covering the period from the vessel's delivery under the charter-party on January 15, 2021 through the termination of the charter on December 31, 2022. These records include scheduled maintenance reports, unscheduled maintenance and repair records, drydocking reports, and spare parts procu

2. Classification Records. Classification records from the Global Maritime Classification Bureau ("GMCB"), including survey reports, class condition records, condition of class notations, and annual survey documentation for the relevant period. These records are directly relevant to TSL's defense that the vessel was maintained in accordance with classification society requirements and that Incident 1 involved a laten

3. Voyage Logs. Voyage logs covering the entire charter period from January 15, 2021 onward, including deck logs, engine room logs, and movement reports for all voyages performed by M/V Aegean Fortuna during the charter period. Of particular relevance are the voyage logs for the Durban-to-Qingdao voyage in September–October 2022, which document the Maputo deviation and the weather conditions that Captain Giannopoulos

4. Communications. Internal communications between TSL management and ship management personnel, including emails, instant messages, and memoranda relating to the operation and maintenance of the vessel, the three mechanical incidents, and interactions with Northwind during the charter period. These communications have been reviewed for responsiveness and privilege, and redacted or withheld as appropriate.

5. Technical Reports. Technical reports relating to all three mechanical incidents, including: • Incident 1 (March 12 – April 2, 2022): Reports from the turbocharger manufacturer (Ashgrove Group), the repair yard in Colombo, Sri Lanka, and TSL's internal technical assessment of the failure. • Incident 2 (July 8 – July 29, 2022): Reports from the BWTS manufacturer, the repair yard at Richards Bay, South Africa, and TS

6. Repair Documentation. Repair invoices, work orders, and completion certificates from all three repair events, including the 25-day drydocking at Keppel Verolme in Rotterdam for Incident 3.

7. Charter-Party and Related Contractual Documents. The charter-party in NYPE 2015 form (Ref. No. NW-TSL-CP-2020-1203, executed December 3, 2020), all addenda thereto (including Addendum No. 1 dated January 10, 2021 regarding trade limits and Addendum No. 2 dated March 15, 2021 regarding bunker adjustment), and all correspondence between TSL and Northwind during the charter period relating to the performance of the c

1. Damages Calculations and Supporting Financial Records. Northwind has produced its internal damages calculations and the financial records supporting its claimed damages of $18,300,000. These include spreadsheets, accounting records, and invoices reflecting hire payments, off-hire deductions, substitute charter costs, and overhead allocations.

2. Cargo Damage Documentation. Northwind has produced documentation relating to its claim for $3,420,000 in cargo damage arising from the iron ore oxidation that occurred during Incident 2 (the BWTS malfunction and auxiliary boiler failure at Richards Bay in July 2022). This documentation includes cargo survey reports, shipper complaints, insurance claims, and settlement correspondence.

3. Substitute Charter Contracts. Northwind has produced the contracts and related correspondence for the substitute vessel it engaged during off-hire periods at a rate of $21,300 per day for 72 days, resulting in a claimed substitute charter premium.

4. Demurrage and Dead Freight Records. Northwind has produced records relating to its demurrage and dead freight claim of $1,230,000 arising from the missed Qingdao laycan window (October 1–5, 2022), which Northwind attributes to the Maputo deviation in September 2022. C. Third-Party Document Requests TSL has served or is in the process of serving third-party document requests to obtain additional records relevant to

III. Interrogatory Status A. TSL's Interrogatories to Northwind TSL's First Set of Interrogatories was served on Northwind on January 22, 2024, contemporaneously with TSL's First Request for Production of Documents. The interrogatories were drafted to elicit detailed information on the following key topics:

1. Northwind's damages calculations across all categories, with a focus on the specific methodology used to arrive at the total claimed damages of $18,300,000, including the allocation of damages among the three mechanical incidents, the substitute charter premium, the lost sub-charter profit, the cargo damage claim, the demurrage and dead freight claim, the third-party shipper claims, and the additional port and bun

2. The terms and conditions of the Eastbourne sub-charter, including the daily hire rate, the duration, any termination or suspension provisions, and the steps Northwind took to mitigate its damages during the off-hire periods (including whether Northwind sought to sub-charter the vessel to alternative charterers or otherwise minimize its losses).

3. The factual basis for Northwind's deviation claim relating to the September 2022 Maputo call, including the specific charter-party provisions Northwind contends were breached, the dates and circumstances of the Maputo port call, and the causal connection between the Maputo call and the missed Qingdao laycan window.

4. The identity, nature, and current status of the three third-party shipper cargo claims totaling $5,634,400, including the shippers' names, the cargo at issue, the nature of each claim, the amounts demanded, the amounts actually paid by Northwind (if any), and any pending litigation or arbitration relating to these claims. Northwind served its responses and objections to TSL's First Set of Interrogatories on March

1. Maintenance History. The complete maintenance history of M/V Aegean Fortuna, including scheduled maintenance intervals, the identity and qualifications of maintenance personnel, and any deferred maintenance items during the charter period. TSL provided a detailed narrative response identifying all scheduled and unscheduled maintenance activities and confirmed that the vessel's maintenance was performed in accordan

2. Turbocharger Latent Defect Theory (Incident 1). The factual basis for TSL's assertion that the turbocharger failure on March 12, 2022 (which caused a 21-day off-hire event culminating in repairs at Colombo) was attributable to a latent manufacturing defect in the turbocharger rotor assembly. TSL's response identified the Ashgrove Group technical report, the Colombo repair yard analysis, and Chief Engineer Vlahos's

3. BWTS Contamination Causation Theory (Incident 2). The factual basis for TSL's assertion that the BWTS malfunction on July 8, 2022 (which caused a 21-day off-hire event and the iron ore oxidation cargo damage) was caused by contaminated ballast water loaded by Northwind's agents at a prior port. TSL's response identified the ballast water loading records, the BWTS manufacturer's diagnostic report, and Vlahos's engi

4. Cylinder Liner Failure (Incident 3). TSL's knowledge of and response to the cylinder liner failure on November 15, 2022, including any prior indications of cylinder liner wear, the timeline of TSL's awareness and response, and the scope and duration of the Keppel Verolme drydocking.

5. Master's Rationale for the Maputo Call. The specific reasons for Captain Giannopoulos's decision to call at Maputo during the Durban-to-Qingdao voyage in September 2022, including any weather-related considerations, routing efficiency factors, and any communications with TSL's commercial department regarding cargo loading opportunities at Maputo. TSL preserved objections on scope, proportionality, and attorney-cli

IV. Depositions — Completed A. Alexandros Stavridis (TSL Chairman and CEO) — April 22, 2024 The deposition of Alexandros Stavridis, TSL's Chairman and CEO, was taken on April 22, 2024 at the offices of Calderwood & Harkness LLP in New York. The deposition was conducted by Margaret Delacroix, the lead partner at Hargrove, Delacroix & Stern LLP representing Northwind. Ms. Delacroix examined Mr. Stavridis for approximat

1. Corporate Decision-Making Regarding Vessel Maintenance Budgets. Mr. Stavridis testified regarding TSL's corporate structure and governance, the role of the board of directors in setting fleet-wide maintenance budgets, and the process by which maintenance decisions for individual vessels are made. He explained that TSL maintains a fleet of approximately 34 vessels — dry bulk carriers, tankers, and container vessels

2. TSL's Fleet Management Practices. Mr. Stavridis described TSL's ship management structure, including the relationship between TSL (as owner) and its in-house ship management division. He testified about the qualifications and experience of key ship management personnel, the Planned Maintenance System protocols followed for M/V Aegean Fortuna, and TSL's safety and compliance record.

3. Knowledge of the Three Mechanical Incidents. Mr. Stavridis was questioned about his personal knowledge of and involvement in the response to each of the three mechanical incidents. He testified that he was informed of each incident within hours of its occurrence through standard reporting channels and that he participated in certain high-level decisions regarding the vessel's repair and return to service.

4. The Maputo Deviation Decision. Ms. Delacroix questioned Mr. Stavridis about whether TSL's commercial department directed or encouraged Captain Giannopoulos to call at Maputo in September 2022 to load TSL cargo. Mr. Stavridis testified that while TSL's commercial department did identify a cargo opportunity at Maputo and communicated that information to the Master, the decision to call at Maputo was ultimately the M

5. TSL's Financial Capacity. Mr. Stavridis was questioned about TSL's financial condition, presumably in connection with any potential punitive damages or litigation funding arguments. He testified that TSL's fiscal year 2022 revenue was approximately $612 million and EBITDA was approximately $98 million. Assessment. Mr. Stavridis performed well in his deposition. He was composed, direct, and avoided volunteering inf

1. The Decision to Call at Maputo. Captain Giannopoulos testified at length about his decision to divert M/V Aegean Fortuna from the direct Durban-to-Qingdao routing to call at the port of Maputo, Mozambique in September 2022. He testified that the decision was driven primarily by weather conditions and routing efficiency. Specifically, he stated that weather forecasts indicated deteriorating conditions along the sou

2. Duration of the Deviation. Captain Giannopoulos testified that the Maputo call added approximately four days to the total voyage duration. He maintained that this four-day addition was reasonable under the circumstances, considering the weather conditions and the alternative routing options available.

3. Compliance with Trade Limits. Mr. Trumbull questioned Captain Giannopoulos about whether the Maputo call was within the trade limits specified in Clause 5 of the charter-party and Addendum No. 1. Captain Giannopoulos testified that Maputo was within the approved trading range and that the call did not violate any geographic trade restrictions.

4. Communications with TSL's Commercial Department. Captain Giannopoulos acknowledged that he was in communication with TSL's commercial department during the period leading up to the Maputo call and that the commercial department had identified a cargo loading opportunity at Maputo. Assessment. Captain Giannopoulos testified credibly and presented as a seasoned, experienced mariner whose primary concern was the safe

1. Ballast Water Management Responsibility (Incident 2). Mr. Lindgren conceded that Northwind's agents were responsible for ballast water management operations at the port immediately prior to Richards Bay. Specifically, he acknowledged that the charterer's agents directed the loading of ballast water at the prior port and that the charterer, not the owner, bore responsibility for ensuring that the ballast water load

2. Delay in Seeking Substitute Charters (Mitigation). Mr. Lindgren acknowledged that Northwind did not begin exploring alternative vessels or substitute charter arrangements until at least ten days after each off-hire event commenced. When asked why Northwind waited this long before seeking to mitigate its damages, Mr. Lindgren stated that Northwind initially expected the off-hire periods to be short and did not cons

3. Clause 28 Liquidated Damages Cap. Mr. Lindgren maintained Northwind's position that the Clause 28 liquidated damages cap of $4,500,000 applies separately to each "single continuous period of breach," meaning that each of the three mechanical incidents constitutes a separate breach subject to its own $4,500,000 cap (yielding a potential total of $13,500,000 in liquidated damages across all three incidents). TSL's p

4. Knowledge of Specific Damages Components. Mr. Lindgren's testimony regarding Northwind's total claimed damages of $18,300,000 was consistent with Northwind's pleadings in its general outlines, but Mr. Lindgren lacked detailed supporting knowledge on certain significant line items. In particular, he was unable to provide specific testimony about the $5,634,400 in third-party shipper claims (deferring to Northwind's

1. Damages Methodology. Ms. Chow was questioned about the methodology used to calculate Northwind's claimed damages across all categories. She described the internal process by which Northwind assembled its damages figures and confirmed that certain components of the damages calculation were prepared with the assistance of Northwind's retained damages expert, Dr. Rajesh Anand of Pinnacle Valuation Partners LLP.

2. Substitute Charter Costs. Ms. Chow testified about the substitute charter arrangements Northwind made during the off-hire periods. She confirmed that Northwind engaged a substitute vessel at a rate of $21,300 per day for a total of 72 days, yielding a substitute charter premium of $471,600 over the base charter rate.

3. Eastbourne Sub-Charter. Ms. Chow provided testimony about the Eastbourne Bulk Carriers sub-charter at $17,200 per day and the lost sub-charter profit calculation of $166,600.

4. Cargo Damage Claim. Ms. Chow testified about the documentation supporting the $3,420,000 iron ore oxidation cargo damage claim arising from Incident 2. Key Observations. Several aspects of Ms. Chow's testimony are favorable to TSL:

1. Single Substitute Charter Quote. Ms. Chow's testimony revealed that Northwind obtained only one substitute charter quote before engaging the substitute vessel at $21,300 per day. When asked whether Northwind sought competitive bids from multiple vessel owners or brokers, Ms. Chow confirmed that Northwind contacted only a single broker, who provided a single vessel option. Ms. Chow stated that Northwind accepted th

2. Inability to Reconcile Damages Components. Ms. Chow was unable to fully reconcile certain components of Northwind's damages calculation during her deposition testimony. In particular, the additional port and bunker costs of $875,400 — which constitute a not-insignificant portion of Northwind's total claimed damages — were not clearly supported by Ms. Chow's testimony. She referred repeatedly to Dr. Rajesh Anand of

3. Counterclaim — Withheld Hire. Ms. Chow confirmed on the record that Northwind withheld hire payments totaling $1,620,000 for the period October 1 through December 31, 2022. She testified that the withholding was based on Northwind's assertion of off-hire rights under Clause 11 of the charter-party and its claim to an equitable setoff against the hire payments. This testimony is relevant to TSL's counterclaim, as i

V. Depositions — Completed (Additional Witnesses) A. Chief Engineer Petros Vlahos — June 28, 2024 The deposition of Chief Engineer Petros Vlahos, who served as Chief Engineer aboard M/V Aegean Fortuna during the charter period, was taken on June 28, 2024 at the offices of Calderwood & Harkness LLP in New York. The deposition was conducted by Jason Trumbull of HD&S and lasted approximately six and a half hours. TSL pr

1. Incident 1 — Turbocharger Failure (March 12 – April 2, 2022). Chief Engineer Vlahos testified at length about the turbocharger failure that occurred on March 12, 2022, which caused a loss of engine power and required the vessel to proceed to Colombo for repairs. Vlahos testified that the failure mode — a fracture in the turbocharger rotor assembly — was consistent with a latent manufacturing defect in the rotor bl

2. Incident 2 — BWTS Malfunction and Auxiliary Boiler Failure (July 8 – July 29, 2022). Chief Engineer Vlahos testified about the BWTS malfunction that occurred on July 8, 2022, while the vessel was en route to Richards Bay. He stated that the BWTS filtration system became blocked by sediment and organic matter present in the ballast water, which he attributed to the quality of ballast water loaded at the prior port.

3. Incident 3 — Cylinder Liner Failure (November 15 – December 10, 2022). Chief Engineer Vlahos's testimony on Incident 3 was the most nuanced and presents some risk for TSL. Vlahos testified about the cylinder liner failure that occurred on November 15, 2022, which necessitated the 25-day drydocking at Keppel Verolme Shipyard in Rotterdam for cylinder liner replacement. He acknowledged, consistent with his contempor

VI. Expert Engagement and Report Timeline A. TSL's Retained Experts TSL has retained two experts for this matter, both of whom are actively working on their expert reports in preparation for the August 5, 2024 service deadline.

1. Maritime Engineering Expert: Dr. Henrik Sørensen Dr. Henrik Sørensen, Principal of Nordic Maritime Consulting Group ApS, located at Amaliegade 33, 1256 Copenhagen K, Denmark, has been retained as TSL's maritime engineering expert. Dr. Sørensen was retained via engagement letter dated February 1, 2024, signed by Douglas Carmichael on behalf of Calderwood & Harkness LLP. Expert fees incurred to date are approximatel

2. Damages Expert: Dr. Constance Albright Dr. Constance Albright, Managing Director of Clearwater Economics LLC, located at 1001 Pennsylvania Avenue NW, Suite 700, Washington, DC 20004, has been retained as TSL's damages expert. Dr. Albright was retained via engagement letter dated February 15, 2024, signed by Douglas Carmichael on behalf of Calderwood & Harkness LLP. Expert fees incurred to date are approximately $2

1. Maritime Operations Expert: Captain Julian Blackmore (Ret.) of Blackmore Maritime Advisory Ltd., located at 12 Mincing Lane, London EC3R 7AA, United Kingdom. Captain Blackmore is a retired Royal Navy officer and experienced maritime consultant who has testified as an expert in numerous maritime disputes. He is expected to opine on the operational aspects of the three mechanical incidents, TSL's maintenance practic

2. Damages Expert: Dr. Rajesh Anand of Pinnacle Valuation Partners LLP, located at 399 Park Avenue, Suite 2200, New York, NY 10022. Dr. Anand is expected to provide a damages report supporting Northwind's claimed damages of $18,300,000 and its interpretation of the Clause 28 liquidated damages cap as a per-incident cap. As noted above, both Mr. Lindgren and Ms. Chow referred to Dr. Anand during their depositions as t

VII. Key Strategic Issues and Recommendations The following discussion addresses the key strategic issues that will shape the remainder of the pretrial phase and the trial itself, along with our recommendations for each. A. Liquidated Damages Cap Interpretation (Clause 28) The interpretation of the Clause 28 liquidated damages cap is the single most consequential legal issue in this case. The difference between TSL's