CREDIT AGREEMENT
Dated as of [●], 2023
among
THALASSA SHIPPING & LOGISTICS SA, as Borrower,
THE GUARANTORS PARTY HERETO,
THE LENDERS PARTY HERETO,
MERIDIAN ATLANTIC BANK, NATIONAL ASSOCIATION, as Administrative Agent,
MERIDIAN ATLANTIC BANK, NATIONAL ASSOCIATION, as Sole Lead Arranger and Sole Bookrunner,
and
PINNACLE TRUST & AGENCY SERVICES INC., as Collateral Agent
$150,000,000 SENIOR SECURED REVOLVING CREDIT FACILITY
New York Law Governed
NEAR-FINAL DRAFT — BORROWER'S EXECUTION VERSION
July 3, 2023
Prepared by Calderwood & Harkness LLP
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CREDIT AGREEMENT
This CREDIT AGREEMENT, dated as of [●], 2023, is entered into by and among THALASSA SHIPPING & LOGISTICS SA, a Société Anonyme organized under the laws of the Hellenic Republic, with Greek Tax ID (AFM) 094728361, GEMI Registration No. 143209501000, and registered office at 14 Akti Miaouli, Piraeus 185 35, Greece (the “Borrower”), the Guarantors party hereto, the Lenders party hereto, MERIDIAN ATLANTIC BANK, NATIONAL ASSOCIATION, as Administrative Agent, Sole Lead Arranger, Sole Bookrunner, Issuing Bank, Swingline Lender and a Lender, and PINNACLE TRUST & AGENCY SERVICES INC., as Collateral Agent.
The Borrower has requested that the Lenders establish a senior secured revolving credit facility in an aggregate principal amount of $150,000,000, the proceeds of which are to be used to refinance the Existing Facility and for general corporate purposes and working capital. The Lenders are willing to extend such credit to the Borrower on the terms and subject to the conditions set forth herein.
Accordingly, the parties hereto agree as follows:
ARTICLE I — DEFINITIONS AND INTERPRETATION
Section 1.01 — Defined Terms
As used in this Agreement, the following terms have the meanings specified below:
“ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bear interest at a rate determined by reference to the Alternate Base Rate.
“Administrative Agent” means Meridian Atlantic Bank, National Association, in its capacity as administrative agent for the Lenders under this Agreement and the other Loan Documents, with principal office at 600 Lexington Avenue, 38th Floor, New York, NY 10022, and any successor administrative agent appointed pursuant to Article IX.
“Administrative Agent Fee” has the meaning assigned to such term in Section 2.11(b).
“Affiliate” means, with respect to a specified Person, another Person that directly or indirectly Controls, is Controlled by, or is under common Control with, the Person specified.
“Aggregate Exposure” means, with respect to any Lender at any time, the aggregate principal amount of such Lender’s outstanding Revolving Loans and its participation in LC Exposure and Swingline Exposure at such time.
“Agreement” means this Credit Agreement, as amended, restated, amended and restated, supplemented or otherwise modified from time to time.
“Alternate Base Rate” or “ABR” means, for any day, a rate per annum equal to the highest of (a) the prime rate of Meridian Atlantic Bank, National Association in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 0.50%, and (c) Adjusted Term SOFR for a one-month Interest Period in effect on such day plus 1.00%; provided that for purposes of clause (c), Adjusted Term SOFR shall be determined on such day based upon the Term SOFR Screen Rate at approximately 5:00 a.m., New York City time, on such day, or if such day is not a Business Day, the immediately preceding Business Day. Any change in the Alternate Base Rate due to a change in the prime rate, the Federal Funds Effective Rate or Adjusted Term SOFR shall be effective from and including the effective date of such change.
“Anti-Corruption Laws” means all laws, rules and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries from time to time concerning or relating to bribery or corruption, including the U.S. Foreign Corrupt Practices Act of 1977 and the UK Bribery Act 2010.
“Applicable Margin” means, with respect to any Term SOFR Loan or ABR Loan, the applicable percentage per annum set forth in the pricing grid in Section 2.08(b), determined by reference to the Consolidated Net Leverage Ratio as of the most recently ended fiscal quarter for which financial statements and a Compliance Certificate have been delivered pursuant to Section 5.01; provided that from the Closing Date until delivery of the first Compliance Certificate after the Closing Date, the Applicable Margin for Term SOFR Loans shall be 2.75% per annum and for ABR Loans shall be 1.75% per annum. The Applicable Margin shall range from 2.25% to 3.25% per annum for Term SOFR Loans and from 1.25% to 2.25% per annum for ABR Loans.
“Approved Appraiser” means Seastone Maritime Advisors Ltd. or such other independent internationally recognized ship valuation firm reasonably acceptable to the Administrative Agent.
“Arranging Fee” means the upfront arranging fee in the amount of $750,000, equal to 0.50% of the Total Commitments of $150,000,000, payable on the Closing Date to Meridian Atlantic Bank, National Association, in its capacity as Sole Lead Arranger and Sole Bookrunner.
“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee, and accepted by the Administrative Agent, substantially in the form of Exhibit C or such other form as shall be approved by the Administrative Agent.
“Assignment of Earnings” means each assignment of earnings and earnings accounts executed by the applicable vessel-owning subsidiary in favor of the Collateral Agent with respect to any Mortgaged Vessel, as the same may be amended, supplemented or otherwise modified from time to time.
“Assignment of Insurances” means each assignment of insurances executed by the applicable vessel-owning subsidiary in favor of the Collateral Agent assigning rights in respect of hull and machinery, protection and indemnity, war risks and related insurances for any Mortgaged Vessel.
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark or payment period for interest calculated with reference to such Benchmark, that is or may be used for determining the length of an Interest Period pursuant to this Agreement as of such date.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU, the implementing law, regulation, rule or requirement for such EEA Member Country from time to time in effect and with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 and any other law, regulation, rule or requirement in effect in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates.
“Benchmark” means, initially, Term SOFR; provided that if a Benchmark Replacement has replaced the then-current Benchmark pursuant to Section 2.14, then “Benchmark” means such Benchmark Replacement to the extent applicable.
“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date: (1) the sum of (a) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower as the replacement for the then-current Benchmark giving due consideration to any selection or recommendation of a replacement rate or the mechanism for determining such a rate by the Relevant Governmental Body for syndicated credit facilities denominated in Dollars and (b) the related Benchmark Replacement Adjustment; (2) Daily Simple SOFR plus the related Benchmark Replacement Adjustment; and (3) the sum of (a) the alternate benchmark rate selected by the Administrative Agent and the Borrower in consultation with the Lenders and (b) the related Benchmark Replacement Adjustment; provided that, in each case, such Benchmark Replacement shall not include any tenor that has been removed from the definition of “Interest Period” pursuant to Section 2.14(d).
“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor, the spread adjustment, or method for calculating or determining such spread adjustment, which may be a positive or negative value or zero, that has been selected by the Administrative Agent and the Borrower giving due consideration to any selection or recommendation of a spread adjustment by the Relevant Governmental Body for syndicated credit facilities denominated in Dollars at such time.
“Benchmark Replacement Conforming Changes” means, with respect to the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes, including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of breakage provisions and other technical, administrative or operational matters, that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or that no market practice exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement.
“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark: (1) in the case of clause (a) or (b) of the definition of “Benchmark Transition Event,” the later of (x) the date of the public statement or publication of information referenced therein and (y) the date on which the administrator of the Benchmark permanently or indefinitely ceases to provide the Benchmark; or (2) in the case of clause (c) of the definition of “Benchmark Transition Event,” the first date on which the Benchmark has been determined and announced by the regulatory supervisor for the administrator of such Benchmark to be no longer representative; provided that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause and even if the Benchmark continues to be provided on such date.
“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark: (a) a public statement or publication of information by or on behalf of the administrator of the Benchmark announcing that such administrator has ceased or will cease to provide all Available Tenors of the Benchmark, permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of the Benchmark; (b) a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, the CME Term SOFR Administrator, an insolvency official with jurisdiction over the administrator for the Benchmark, a resolution authority with jurisdiction over the administrator for the Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for the Benchmark, which states that the administrator of the Benchmark has ceased or will cease to provide all Available Tenors of the Benchmark permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of the Benchmark; or (c) a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark announcing that all Available Tenors of the Benchmark are no longer representative.
“Benchmark Unavailability Period” means, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to the then-current Benchmark and solely to the extent that no Benchmark Replacement has replaced such then-current Benchmark pursuant to Section 2.14, the period from and including such Benchmark Replacement Date to but excluding the date on which a Benchmark Replacement is implemented pursuant to Section 2.14.
“Beneficial Ownership Certification” means a certification regarding beneficial ownership required by 31 C.F.R. § 1010.230 or any successor provision.
“Borrower” means Thalassa Shipping & Logistics SA, a Société Anonyme organized under the laws of the Hellenic Republic, with Greek Tax ID (AFM) 094728361, GEMI Registration No. 143209501000, and registered office at 14 Akti Miaouli, Piraeus 185 35, Greece.
“Borrowing” means Revolving Loans of the same Type made, converted or continued on the same date and, in the case of Term SOFR Loans, as to which a single Interest Period is in effect, or a Swingline Loan, as the context requires.
“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with Section 2.03, substantially in the form of Exhibit A.
“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized or required by law to close in New York City, London or Athens, and, where such day relates to any Term SOFR Loan, any such day that is also a U.S. Government Securities Business Day.
“Capital Expenditures” means, for any period, the aggregate of all expenditures by the Borrower and its Subsidiaries during such period that, in accordance with IFRS, are or should be included in “additions to property, plant or equipment,” “vessels and vessel improvements,” or similar capital asset accounts, including costs of drydocking and major vessel improvements to the extent capitalized under IFRS, but excluding expenditures financed with insurance proceeds, condemnation proceeds or the proceeds of permitted equity issuances and expenditures constituting a Permitted Acquisition to the extent otherwise permitted under this Agreement.
“Cash Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of one or more of the Issuing Bank, the Swingline Lender or the Lenders, as collateral for LC Exposure or obligations in respect of Swingline Loans, cash or deposit account balances or, if agreed by the Administrative Agent and the Issuing Bank or Swingline Lender, other credit support, in each case pursuant to documentation reasonably satisfactory to the Administrative Agent, the Issuing Bank and the Swingline Lender, as applicable.
“Cash Equivalents” means any of the following, to the extent owned by the Borrower or any Subsidiary free and clear of all Liens other than Liens in favor of the Collateral Agent and having maturities of not more than one year from the date of acquisition: (a) direct obligations of, or obligations guaranteed by, the United States, the United Kingdom, Greece or any member state of the European Union rated A or better; (b) commercial paper rated at least A-1 by S&P or P-1 by Moody’s; (c) demand, time and eurodollar deposits with, and certificates of deposit or bankers’ acceptances issued by, any Lender or any commercial bank having capital and surplus in excess of $500,000,000; (d) money market funds that invest substantially all of their assets in instruments of the types described in clauses (a) through (c); and (e) short-term repurchase agreements in respect of securities of the type described in clause (a).
“Change of Control” means the occurrence of any of the following: (a) Nikolaos Karadimitriou and/or his Permitted Transferees shall cease to own, directly or indirectly, beneficially and of record, at least 51% of the voting equity interests of the Borrower; or (b) the Borrower shall cease to own, directly or indirectly, 100% of the equity interests of any Guarantor, except to the extent resulting from a Permitted Disposition expressly permitted by this Agreement.
“Charter Assignment” means each assignment of charterparty rights executed by the applicable vessel-owning subsidiary in favor of the Collateral Agent with respect to any time charter for a Mortgaged Vessel having a remaining term of twelve (12) months or more.
“Closing Date” means the date on which all conditions precedent set forth in Section 4.01 have been satisfied or waived in accordance with this Agreement.
“Code” means the Internal Revenue Code of 1986, as amended.
“Collateral” means, collectively, the Mortgaged Vessels, the Earnings Accounts, the rights assigned pursuant to the Assignment of Earnings, the rights assigned pursuant to the Assignment of Insurances, the rights assigned pursuant to the Charter Assignments, the equity interests pledged pursuant to the Share Pledges and all proceeds thereof, in each case to the extent granted as security to the Collateral Agent under the Security Documents.
“Collateral Agent” means Pinnacle Trust & Agency Services Inc., a Delaware corporation, with principal office at One Liberty Plaza, 44th Floor, New York, NY 10006, in its capacity as collateral agent under the Loan Documents, together with its successors in such capacity.
“Collateral Coverage Ratio” means, as of any date of determination, the ratio, expressed as a percentage, of (a) the aggregate Fair Market Value of the Mortgaged Vessels as most recently determined by Approved Appraisers in accordance with this Agreement to (b) the total outstanding Obligations (excluding undrawn contingent obligations not then drawn, other than LC Exposure), which ratio shall at all times be not less than 140%.
“Commitment” means, with respect to each Lender, the commitment of such Lender to make Revolving Loans, participate in Letters of Credit and participate in Swingline Loans hereunder, as set forth opposite such Lender’s name on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender assumed its Commitment, as the same may be reduced or terminated from time to time pursuant to this Agreement.
“Commitment Fee” has the meaning assigned to such term in Section 2.11(a).
“Commitment Termination Date” means the Maturity Date or such earlier date on which the Commitments are terminated pursuant to this Agreement.
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.
“Compliance Certificate” means a certificate substantially in the form of Exhibit B.
“Consolidated EBITDA” means, for any period, Consolidated Net Income for such period, plus, without duplication and to the extent deducted in determining such Consolidated Net Income, the sum of (a) Consolidated Interest Expense, (b) income tax expense, (c) depreciation and amortization, (d) non-cash charges, losses or expenses, including non-cash impairment charges, unrealized foreign exchange losses and non-cash stock compensation, (e) transaction fees, costs and expenses incurred in connection with the Transactions up to $5,000,000 in the aggregate, and (f) losses on dispositions of assets outside the ordinary course of business, minus, without duplication and to the extent included in determining such Consolidated Net Income, (i) non-cash gains, (ii) unrealized foreign exchange gains and (iii) gains on dispositions of assets outside the ordinary course of business; provided that Consolidated EBITDA shall be calculated on a consolidated basis for the Borrower and its Subsidiaries in accordance with IFRS.
“Consolidated Interest Coverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated EBITDA for the trailing four fiscal quarter period then ended to (b) Consolidated Interest Expense for such trailing four fiscal quarter period. The Consolidated Interest Coverage Ratio shall be not less than 3.00:1.00.
“Consolidated Interest Expense” means, for any period, the total interest expense of the Borrower and its Subsidiaries for such period, determined on a consolidated basis in accordance with IFRS, including the interest component of Capitalized Lease Obligations, commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing, but excluding non-cash amortization of deferred financing costs.
“Consolidated Net Income” means, for any period, the net income (or loss) of the Borrower and its Subsidiaries for such period, determined on a consolidated basis in accordance with IFRS; provided that there shall be excluded therefrom (a) extraordinary, unusual or non-recurring gains and losses, (b) the income or loss of any Person accrued prior to the date it becomes a Subsidiary, and (c) the net income of any Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary is not at the time permitted by operation of the terms of its organizational documents, any contractual obligation or applicable law.
“Consolidated Net Leverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated Total Net Debt as of such date to (b) Consolidated EBITDA for the trailing four fiscal quarter period then ended. The Consolidated Net Leverage Ratio shall not exceed 4.50:1.00, stepping down to 4.00:1.00 commencing with the first full fiscal quarter ending on or after the third anniversary of the Closing Date.
“Consolidated Total Net Debt” means, as of any date of determination, (a) consolidated Indebtedness of the Borrower and its Subsidiaries for borrowed money and unreimbursed drawn letters of credit, minus (b) unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries in excess of $10,000,000 and up to a maximum amount equal to $50,000,000 for purposes of this definition.
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies of a Person, whether through the ownership of voting securities, by contract or otherwise. “Controls” and “Controlled” have correlative meanings.
“Default” means any event or condition which upon notice, lapse of time or both would constitute an Event of Default.
“Default Rate” means the rate described in Section 2.08(d).
“Defaulting Lender” means any Lender that has failed to fund any portion of its Loans, participations or other required payments under this Agreement within two Business Days of the date required to be funded, that has notified the Administrative Agent, the Borrower, the Issuing Bank or the Swingline Lender in writing that it does not intend to comply with its funding obligations, that has failed within three Business Days after written request by the Administrative Agent to confirm that it will comply with its prospective funding obligations, or as to which a Lender Insolvency Event has occurred and is continuing.
“Dollars” or “$” means lawful money of the United States of America.
“Domestic Subsidiary” means any Subsidiary organized under the laws of the United States, any state thereof or the District of Columbia.
“Earnings Accounts” means the deposit accounts into which charter hire, freight, earnings, requisition compensation and other earnings of the Mortgaged Vessels are required to be paid pursuant to Section 5.13 and the Security Documents.
“EEA Financial Institution” means (a) any institution established in any EEA Member Country that is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country that is a parent of an institution described in clause (a), or (c) any institution established in an EEA Member Country that is a subsidiary of an institution described in clause (a) or (b) and is subject to consolidated supervision with its parent.
“EEA Member Country” means any member state of the European Union, Iceland, Liechtenstein and Norway.
“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country, including any delegee, having responsibility for the resolution of any EEA Financial Institution.
“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 11.04.
“Environmental Claim” means any investigation, notice, notice of violation, claim, action, suit, proceeding, demand, abatement order or other order or directive by any governmental authority or any other Person arising pursuant to or in connection with any actual or alleged violation of any Environmental Law or any actual or alleged liability thereunder.
“Environmental Laws” means all applicable laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions and legally binding directives of any governmental authority relating to pollution, the protection of the environment, human health and safety as affected by exposure to hazardous substances, or the generation, manufacture, processing, distribution, use, treatment, storage, transport, release or disposal of hazardous substances, including MARPOL and laws implementing MARPOL.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“ERISA Event” means any of (a) a Reportable Event with respect to a Pension Plan, (b) the failure to satisfy the minimum funding standard with respect to any Pension Plan, (c) a withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan, (d) the filing of a notice of intent to terminate, the treatment of a Pension Plan amendment as a termination or the commencement of proceedings by the PBGC to terminate a Pension Plan, (e) the occurrence of an event or condition which might reasonably be expected to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or (f) the imposition of liability under Title IV of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of ERISA.
“Event of Default” has the meaning assigned to such term in Section 8.01.
“Excluded Taxes” means, with respect to any payment made by or on account of an obligation of any Loan Party under any Loan Document, (a) Taxes imposed on or measured by overall net income, however denominated, and franchise Taxes, branch profits Taxes and similar Taxes, in each case imposed by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any U.S. federal withholding Tax that is imposed on amounts payable to or for the account of a Lender pursuant to a law in effect at the time such Lender becomes a party hereto, except to the extent such Lender’s assignor was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such withholding Tax pursuant to Section 2.17, (c) any Tax attributable to such recipient’s failure to comply with Section 2.17(c), and (d) any withholding Taxes imposed under FATCA.
“Existing Credit Agreement” means the Credit Agreement dated November 15, 2018 among the Borrower and Harborstone National Bank, as amended by that certain First Amendment dated June 30, 2020 and that certain Second Amendment dated March 1, 2022.
“Existing Facility” means the $125,000,000 revolving credit facility under the Existing Credit Agreement.
“Fair Market Value” means, with respect to any Mortgaged Vessel, the fair market value thereof as determined by an Approved Appraiser pursuant to an appraisal addressed to the Administrative Agent and the Collateral Agent. The initial appraisals shall be those delivered by Seastone Maritime Advisors Ltd. dated July 10, 2023.
“FATCA” means Sections 1471 through 1474 of the Code, as in effect on the date hereof or as amended, and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.
“Fee Letter” means that certain fee letter dated July 3, 2023 among the Borrower and Meridian Atlantic Bank, National Association.
“Financial Officer” means the chief financial officer, principal accounting officer, treasurer or controller of the Borrower.
“First Preferred Ship Mortgage” means, with respect to each Mortgaged Vessel, the first priority preferred ship mortgage, deed of covenant or equivalent vessel mortgage document creating a first-priority Lien on such Mortgaged Vessel in favor of the Collateral Agent, duly executed and recorded under the laws of the applicable flag state.
“Funded Debt” means all Indebtedness for borrowed money, including Revolving Loans, Swingline Loans and unreimbursed drawings under Letters of Credit.
“GAAP” means generally accepted accounting principles in the United States; provided that for purposes of this Agreement, all accounting terms and covenant calculations shall be based on IFRS as provided in Section 1.04 unless expressly stated otherwise.
“GEMI” means the General Electronic Commercial Registry of Greece.
“Governmental Authority” means the government of the United States, Greece, Cyprus, the Republic of the marshall Islands, the United Kingdom or any other nation, or any political subdivision thereof, whether state, local or otherwise, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of government.
“Guarantors” means, collectively, (i) Thalassa Dry Bulk Holdings Ltd., a private limited company organized under the laws of the Republic of Cyprus, (ii) Thalassa Tanker Operations Ltd., a private limited company organized under the laws of the Republic of the marshall Islands, and (iii) Thalassa Logistics International Ltd., a private limited company organized under the laws of the Republic of Cyprus, together with each other Subsidiary that becomes a guarantor hereunder pursuant to Section 5.12, in each case unless and until released in accordance with this Agreement.
“Guaranty” means the guaranty contained in Article X.
“IFRS” means International Financial Reporting Standards as issued by the International Accounting Standards Board and applied by the Borrower in preparing its financial statements.
“Indebtedness” means, with respect to any Person, without duplication, (a) obligations for borrowed money, (b) obligations evidenced by bonds, debentures, notes or similar instruments, (c) obligations in respect of letters of credit, bankers’ acceptances or similar instruments, to the extent drawn, (d) Capitalized Lease Obligations, (e) obligations of such Person to pay the deferred purchase price of property or services, other than trade accounts payable incurred in the ordinary course of business, (f) indebtedness secured by any Lien on any property or asset owned by such Person, whether or not such indebtedness has been assumed, and (g) guaranties of the foregoing.
“Indemnified Taxes” means Taxes other than Excluded Taxes.
“Interest Election Request” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.07.
“Interest Payment Date” means (a) as to any Term SOFR Loan, the last day of each applicable Interest Period and, in the case of an Interest Period longer than three months, each date occurring at three-month intervals after the first day of such Interest Period, and (b) as to any ABR Loan, the last Business Day of each March, June, September and December and the Maturity Date.
“Interest Period” means, with respect to any Term SOFR Borrowing, the period commencing on the date of such Borrowing or continuation and ending on the numerically corresponding day in the calendar month that is one, three or six months thereafter, as selected by the Borrower; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next Business Day unless such next Business Day would fall in the next calendar month, in which case such Interest Period shall end on the immediately preceding Business Day, and (b) no Interest Period shall end after the Maturity Date.
“IRS” means the United States Internal Revenue Service.
“Issuing Bank” means Meridian Atlantic Bank, National Association, in its capacity as issuer of Letters of Credit hereunder, and any other Lender that may from time to time agree to issue Letters of Credit hereunder with the consent of the Borrower and the Administrative Agent.
“ISP98” means the International Standby Practices 1998 published by the Institute of International Banking Law & Practice.
“LC Disbursement” means a payment made by the Issuing Bank pursuant to a Letter of Credit.
“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time and (b) the aggregate amount of all unreimbursed LC Disbursements at such time.
“LC Request” means a request by the Borrower for the issuance, amendment, renewal or extension of a Letter of Credit, substantially in the form of Exhibit G.
“LC Sublimit” means $20,000,000.
“Lender Insolvency Event” means, with respect to any Lender, that such Lender or its parent company becomes the subject of a bankruptcy, insolvency, winding-up, resolution or similar proceeding, or a Bail-In Action is taken with respect thereto.
“Lenders” means the financial institutions listed on Schedule 2.01 and any other Person that becomes a party hereto as a Lender pursuant to an Assignment and Assumption, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.
“Letter of Credit” means any standby or commercial letter of credit issued pursuant to Section 2.05.
“Lien” means, with respect to any asset, any mortgage, deed of trust, lien, pledge, hypothecation, assignment by way of security, security interest, charge or encumbrance of any kind in respect of such asset.
“Loan Documents” means this Agreement, the Guaranty, the Security Documents, the Fee Letter, each Borrowing Request, each Compliance Certificate, each LC Request, each promissory note issued pursuant hereto, each Guarantor Accession Agreement and each other instrument, certificate or document designated in writing by the Administrative Agent and the Borrower as a “Loan Document.”
“Loan Parties” means the Borrower, the Guarantors and each other Person that becomes a party to any Loan Document as a grantor, pledgor or guarantor.
“MAC” or “Material Adverse Change” means any event, development or circumstance that has had or could reasonably be expected to have a material adverse effect on (a) the business, operations, financial condition or assets of the Borrower and its Subsidiaries taken as a whole, (b) the ability of any Loan Party to perform its obligations under any Loan Document, or (c) the rights and remedies of the Administrative Agent, the Collateral Agent or the Lenders under any Loan Document.
“MARPOL” means the International Convention for the Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978 and as from time to time amended.
“Material Indebtedness” means Indebtedness in an aggregate principal amount of more than $10,000,000.
“Material Subsidiary” means any Subsidiary of the Borrower that (a) owns one or more vessels, (b) guarantees any Material Indebtedness, or (c) contributes, together with its Subsidiaries, more than 5% of Consolidated EBITDA or more than 5% of consolidated total assets of the Borrower and its Subsidiaries.
“Maturity Date” means the date that is five (5) years after the Closing Date.
“Minimum Liquidity” means, at any time, unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries plus unused and available Commitments, in an aggregate amount not less than $30,000,000.
“MLC 2006” means the Maritime Labour Convention, 2006, as amended and in force from time to time.
“Mortgaged Vessels” means the eighteen (18) vessels identified on Schedule 5.17, having an aggregate appraised Fair Market Value of $780,000,000 as reflected in the Seastone Maritime Advisors Ltd. appraisals dated July 10, 2023, together with each additional vessel that becomes subject to a First Preferred Ship Mortgage and related Security Documents after the Closing Date.
“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“NYFRB” means the Federal Reserve Bank of New York.
“Obligations” means all obligations and liabilities of every nature of the Loan Parties from time to time owed to the Administrative Agent, the Collateral Agent, the Issuing Bank, the Swingline Lender or the Lenders under or in connection with this Agreement or any other Loan Document, whether for principal, interest, fees, expenses, indemnities or otherwise, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising.
“OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
“Other Connection Taxes” means, with respect to any recipient, Taxes imposed as a result of a present or former connection between such recipient and the jurisdiction imposing such Taxes, other than connections arising solely from such recipient having executed, delivered, become a party to, performed its obligations under, received payment under, received or perfected a security interest under, sold or assigned an interest in, or enforced, any Loan Document.
“Participant” has the meaning assigned to such term in Section 11.04.
“Payment Office” means the office of the Administrative Agent specified in Section 11.01, or such other office as the Administrative Agent may designate in writing from time to time.
“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.
“Permitted Acquisition” means any acquisition by the Borrower or any Subsidiary of all or substantially all of the assets of, or all of the equity interests in, another Person, or of one or more vessels or maritime logistics businesses, so long as (a) no Default or Event of Default exists or would result therefrom, (b) the acquired assets are used in a line of business permitted by Section 6.10, (c) the Borrower shall be in pro forma compliance with the financial covenants set forth in Article VII after giving effect thereto, (d) if requested by the Administrative Agent, the Borrower delivers evidence reasonably satisfactory to the Administrative Agent demonstrating such pro forma compliance, and (e) if necessary to maintain compliance with Section 7.05, the Borrower causes any acquired vessel to become Collateral and any acquired Material Subsidiary to become a Guarantor.
“Permitted Disposition” means (a) dispositions of obsolete, worn-out or surplus equipment in the ordinary course of business, (b) chartering of vessels in the ordinary course of business other than prohibited bareboat chartering of Mortgaged Vessels, (c) dispositions of vessels or other assets for fair market value so long as no Event of Default exists or would result therefrom, the mandatory prepayment provisions of Section 2.10(b) are complied with and compliance with Section 7.05 is maintained, and (d) other dispositions not exceeding $15,000,000 in the aggregate in any fiscal year.
“Permitted Indebtedness” means: (a) the Obligations; (b) Indebtedness existing on the Closing Date and listed on Schedule 6.01, to the extent repaid on the Closing Date if so indicated thereon; (c) intercompany Indebtedness among the Borrower and Guarantors; (d) unsecured Indebtedness of the Borrower and its Subsidiaries not exceeding $25,000,000 in the aggregate at any time outstanding; (e) purchase money Indebtedness and Capitalized Lease Obligations not exceeding $15,000,000 in the aggregate at any time outstanding; (f) obligations in respect of performance bonds, bid bonds, customs bonds, surety bonds, appeal bonds and similar obligations incurred in the ordinary course of business; (g) customary contingent obligations in respect of indemnities, adjustment of purchase price, non-compete and similar arrangements in connection with Permitted Acquisitions and Permitted Dispositions; (h) Indebtedness arising from treasury, cash management and hedging arrangements entered into in the ordinary course of business and not for speculative purposes; and (i) extensions, renewals and refinancings of the foregoing not resulting in an increase in principal amount except by an amount equal to accrued and unpaid interest, premiums and transaction costs.
“Permitted Liens” means: (a) Liens in favor of the Collateral Agent securing the Obligations; (b) Liens listed on Schedule 6.02, to be released on the Closing Date; (c) maritime liens, crew wage liens, salvage liens, liens for master's disbursements, possessory liens, customs and tax liens, and other Liens arising by operation of law in the ordinary course of business and securing obligations not yet delinquent or being contested in good faith by appropriate proceedings; (d) Liens for Taxes, assessments and governmental charges not yet due or being contested in good faith by appropriate proceedings; (e) carriers’, warehousemen’s, mechanics’, repairers’, materialmen’s and other like Liens arising in the ordinary course of business; (f) easements, rights of way, restrictions, zoning ordinances and similar encumbrances that do not materially interfere with the use of the relevant property; (g) Liens securing purchase money Indebtedness or Capitalized Lease Obligations permitted under Section 6.01; provided that such Liens do not extend beyond the property so acquired or leased; (h) rights of setoff of banks maintained in the ordinary course of business over deposit accounts; (i) customary reservations in vessel sale and purchase agreements in favor of the seller pending completion; and (j) other Liens not securing Indebtedness and not materially impairing the value or use of the relevant assets.
“Permitted Transferees” means, with respect to Nikolaos Karadimitriou, his spouse, descendants, trusts for the benefit of any of the foregoing, and entities wholly owned and controlled by any of the foregoing.
“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, governmental authority or other entity.
“Prime Rate” means the rate of interest per annum publicly announced from time to time by Meridian Atlantic Bank, National Association as its prime rate.
“Pro Rata Share” means, with respect to any Lender, the percentage of the Total Commitments represented by such Lender’s Commitment, subject to adjustment as provided in this Agreement.
“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant guaranty becomes effective or otherwise constitutes an “eligible contract participant” under the Commodity Exchange Act.
“Refunded Swingline Loans” has the meaning assigned to such term in Section 2.04.
“Register” has the meaning assigned to such term in Section 2.09.
“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, advisors and representatives of such Person and such Person’s Affiliates.
“Relevant Governmental Body” means the Board of Governors of the Federal Reserve System, the NYFRB, the CME Term SOFR Administrator, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System or the NYFRB, or any successor thereto.
“Required Lenders” means, at any time, Lenders having aggregate Commitments, or if the Commitments have been terminated, aggregate outstanding Loans and participations in LC Exposure and Swingline Exposure, representing more than 50% of the Total Commitments or such total outstanding exposures, as applicable; provided that the Commitment of, and the portion of such exposures held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.
“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
“Restricted Payment” means any dividend or other distribution on account of any equity interests of the Borrower or any Subsidiary, or any payment on account of the purchase, redemption, retirement or other acquisition of any equity interests of the Borrower or any Subsidiary.
“Revolving Commitment” means, with respect to each Lender, its Commitment to make Revolving Loans under Section 2.01.
“Revolving Loan” means a loan made by a Lender to the Borrower under the Revolving Commitments.
“Sanctioned Person” means any Person that is the subject or target of any Sanctions, including any Person listed on any sanctions-related list maintained by OFAC, the United Nations Security Council, the European Union, His Majesty’s Treasury of the United Kingdom or the Hellenic Republic, or any Person owned 50% or more by any such Person.
“Sanctions” means economic or financial sanctions or trade embargoes administered or enforced by OFAC, the United Nations Security Council, the European Union, His Majesty’s Treasury of the United Kingdom, the Hellenic Republic or any other relevant sanctions authority.
“Security Documents” means the First Preferred Ship Mortgages, the Share Pledge Agreements, the Assignments of Earnings, the Assignments of Insurances, the Charter Assignments and each other security agreement, mortgage, pledge agreement, control agreement or other instrument creating or perfecting a Lien in favor of the Collateral Agent securing the Obligations.
“Share Pledge” means each pledge of 100% of the equity interests in a vessel-owning subsidiary or other relevant Subsidiary executed in favor of the Collateral Agent.
“SOFR” means the secured overnight financing rate published by the NYFRB (or a successor administrator).
“Solvent” means, with respect to any Person, that as of the date of determination (a) the fair value of the property of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person, (b) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to pay its debts and liabilities as they mature, and (d) such Person does not have unreasonably small capital with which to conduct its business.
“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company or other entity of which more than 50% of the equity interests having ordinary voting power for the election of directors or other governing body are at the time owned or controlled, directly or indirectly, by such Person.
“Supported QFC” has the meaning assigned to such term in Section 11.16.
“Swingline Exposure” means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time.
“Swingline Lender” means Meridian Atlantic Bank, National Association, in its capacity as lender of Swingline Loans hereunder.
“Swingline Loan” means a loan made by the Swingline Lender to the Borrower pursuant to Section 2.04.
“Swingline Sublimit” means $15,000,000.
“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, charges, assessments, fees, withholdings or similar charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“Term SOFR” means, for any calculation with respect to a Term SOFR Loan for any Interest Period, the forward-looking term rate based on SOFR for a tenor comparable to such Interest Period on the day that is two U.S. Government Securities Business Days prior to the first day of such Interest Period, as published by the CME Term SOFR Administrator.
“Term SOFR Loan” means a Loan that bears interest at a rate determined by reference to Term SOFR.
“Total Commitments” means the aggregate amount of the Lenders’ Commitments, being $150,000,000 on the Closing Date, as the same may be reduced or terminated from time to time pursuant to this Agreement.
“Transactions” means the execution, delivery and performance by the Loan Parties of the Loan Documents, the borrowing of Loans hereunder, the issuance of Letters of Credit hereunder, the granting of security interests and the use of the proceeds thereof to refinance the Existing Facility and for general corporate purposes and working capital.
“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan is determined by reference to Term SOFR or ABR.
“UK Financial Institution” means any BRRD Undertaking, as such term is defined under the PRA Rulebook, that is subject to prudential supervision by the United Kingdom Prudential Regulation Authority and includes any Person subject to IFPRU Rules or PRA Rulebook.
“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.
“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.
“Unused Commitment” means, at any time, the excess of (a) the Total Commitments over (b) the Utilization at such time.
“Utilization” means, at any time, the aggregate outstanding principal amount of Revolving Loans and Swingline Loans, plus LC Exposure, at such time.
“Write-Down and Conversion Powers” means, with respect to any Resolution Authority, the write-down, conversion, transfer, modification or suspension powers applicable under any Bail-In Legislation.
Any other capitalized term used herein and not otherwise defined shall have the meaning assigned thereto elsewhere in this Agreement or in the relevant Loan Document.
Section 1.02 — Classification of Loans and Borrowings
For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “Term SOFR Loan” or an “ABR Loan”) or by class (e.g., a “Revolving Loan” or a “Swingline Loan”), as appropriate. Borrowings of Revolving Loans are distinguished by whether the Revolving Loans comprising such Borrowing are Term SOFR Loans or ABR Loans, and by the Interest Period applicable thereto, if any. LC Disbursements and the reimbursement obligations related thereto shall be treated in the manner provided in Section 2.05.
Section 1.03 — Terms Generally
The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” The word “or” is not exclusive. Unless the context requires otherwise, references herein to articles, sections, exhibits and schedules are references to articles and sections of, and exhibits and schedules to, this Agreement. Any reference to any agreement or instrument shall be construed as referring to such agreement or instrument as from time to time amended, supplemented, restated or otherwise modified to the extent permitted by this Agreement. References to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including,” the words “to” and “until” each mean “to but excluding,” and the word “through” means “to and including.” Headings are for convenience of reference only and shall not affect the interpretation of this Agreement.
Section 1.04 — Accounting Terms; GAAP
Except as otherwise expressly provided herein, all accounting terms not specifically defined herein shall be construed in accordance with IFRS as applied by the Borrower in the preparation of its consolidated financial statements. It is acknowledged that the Borrower reports its financial statements under IFRS. If at any time any change in IFRS would affect the computation of any financial covenant, basket, threshold or other provision set forth in this Agreement, then the Borrower and the Administrative Agent shall, upon request of either party, negotiate in good faith to amend such provision to preserve the original intent thereof in light of such change; provided that, until so amended, such computation shall continue to be made on a basis consistent with the most recent financial statements delivered pursuant to Section 5.01 prior to the relevant change in IFRS. If requested by the Administrative Agent, the Borrower shall deliver a reconciliation between calculations made before and after giving effect to any such change in IFRS.
Section 1.05 — Interest Rates; Benchmark Notification
The interest rate on Term SOFR Loans may be derived from reference rates that are published and are intended to reflect benchmark borrowing rates. Such benchmark rates may be discontinued or may become unavailable or non-representative. The Administrative Agent does not warrant or accept responsibility for, and shall not have any liability with respect to, (a) the continuation, administration, submission or calculation of, or any component definition used in, the Benchmark, (b) the effect, implementation or composition of any Benchmark Replacement or Benchmark Replacement Conforming Changes, or (c) the effect of any Benchmark Transition Event or Benchmark Unavailability Period. The Administrative Agent shall notify the Borrower and the Lenders of the occurrence of any Benchmark Transition Event, the implementation of any Benchmark Replacement and any Benchmark Replacement Conforming Changes, in each case as provided in Section 2.14.
Section 1.06 — Divisions
For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law or any comparable event under another jurisdiction’s laws: (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence. Any such event shall be treated in a manner consistent with the substance of the transaction for purposes of determining compliance with this Agreement.
ARTICLE II — THE CREDITS
Section 2.01 — Revolving Commitments
Subject to the terms and conditions set forth herein, each Lender severally agrees to make Revolving Loans to the Borrower from time to time during the period from and including the Closing Date to but excluding the Maturity Date, in an aggregate principal amount at any time outstanding not to exceed such Lender’s Commitment. The Total Commitments on the Closing Date shall be $150,000,000.
The Commitments of the Lenders on the Closing Date are as follows:
Within the limits of each Lender’s Commitment and subject to the terms, conditions and limitations set forth herein, the Borrower may borrow, repay and reborrow Revolving Loans. Amounts repaid or prepaid in respect of Revolving Loans may be reborrowed prior to the Maturity Date, thereby confirming the revolving nature of the facility established hereby.
Section 2.02 — Loans and Borrowings
(a) Each Revolving Borrowing shall be comprised entirely of ABR Loans or entirely of Term SOFR Loans, as the Borrower may request in accordance herewith.
(b) At the commencement of each Interest Period for any Term SOFR Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $1,000,000 and not less than $5,000,000. Each ABR Borrowing shall be in an aggregate amount that is an integral multiple of $500,000 and not less than $2,500,000; provided that an ABR Borrowing may be in a lesser amount if such Borrowing represents the entire unused balance of the Commitments.
(c) Each Lender shall make each Revolving Loan to be made by it hereunder on the proposed date thereof by wire transfer in immediately available funds, in accordance with Section 2.06, in an amount equal to such Lender’s Pro Rata Share of the requested Revolving Borrowing.