AMENDED AND RESTATED INTERCREDITOR AGREEMENT
dated as of
May 15, 2023
among
NORDBANK INTERNATIONAL AG, as Administrative Agent and Collateral Agent (the "First-Lien Agent")
and
DRALVECEN MEZZANINE CAPITAL LLC, as Second-Lien Holder (the "Second-Lien Representative")
Acknowledged and Consented to by:
THALASSA SHIPPING & LOGISTICS SOCIÉTÉ ANONYME (the "Company")
and
THALASSA AMERICAS INC. (the "U.S. Co-Borrower")
This Agreement amends and restates in its entirety that certain Intercreditor Agreement, dated as of June 15, 2019, between Nordbank International AG (as First-Lien Agent) and Dralvecen Mezzanine Capital LLC (as second-lien holder) (the "Original Intercreditor Agreement").
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This AMENDED AND RESTATED INTERCREDITOR AGREEMENT (this "Agreement"), dated as of May 15, 2023, is entered into by and among:
NORDBANK INTERNATIONAL AG, an Aktiengesellschaft organized under the laws of Switzerland, with offices at Bahnhofstrasse 78, 8001 Zürich, Switzerland, in its capacity as Administrative Agent and Collateral Agent under the First-Lien Credit Agreement (as defined below) (in such capacity, together with its successors and assigns, the "First-Lien Agent");
and
DRALVECEN MEZZANINE CAPITAL LLC, a Delaware limited liability company, with offices at 600 Lexington Avenue, 22nd Floor, New York, NY 10022, in its capacity as holder of the Second-Lien Notes (as defined below) (the "Second-Lien Representative" or "Second-Lien Holder").
This Agreement is acknowledged and consented to by:
THALASSA SHIPPING & LOGISTICS SOCIÉTÉ ANONYME, a société anonyme organized under the laws of the Hellenic Republic, with registered offices at 42 Akti Miaouli, Piraeus 18538, Greece (the "Company" or "TSL");
and
THALASSA AMERICAS INC., a corporation organized under the laws of the State of Delaware, with principal offices at 1400 McKinney Street, Suite 2200, Houston, TX 77010 (the "U.S. Co-Borrower" or "TAI").
Each of the First-Lien Agent, the Second-Lien Holder, the Company, and the U.S. Co-Borrower is referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS:
A. Original Debt Instruments. TSL (as Borrower), TAI (as Co-Borrower for the U.S. Tranche), Nordbank International AG (as Administrative Agent and Collateral Agent), and the lenders party thereto (the "First-Lien Lenders") are parties to that certain Senior Secured Credit Agreement dated as of June 15, 2019 (the "Original Credit Agreement"), pursuant to which the First-Lien Lenders extended credit facilities to TSL and TAI in an aggregate original commitment amount of Six Hundred Eighty-Five Million United States Dollars ($685,000,000), comprising (i) a Term Loan A facility in the original principal amount of Four Hundred Million Dollars ($400,000,000) (amortizing), (ii) a Revolving Credit Facility in the original committed amount of Two Hundred Million Dollars ($200,000,000), and (iii) a U.S. Tranche Term Loan B facility in the original principal amount of Eighty-Five Million Dollars ($85,000,000) (non-amortizing bullet). The First-Lien Obligations under the Original Credit Agreement bore interest at a rate of Secured Overnight Financing Rate ("SOFR") plus 375 basis points per annum, with a default rate equal to an additional 200 basis points. The First-Lien Lender syndicate consists of the following institutions and their respective commitment amounts: Nordbank International AG ($137,000,000), Aegean Capital Bank SA ($110,000,000), Harborstone Bank plc ($95,000,000), Pacifica Trade Finance Corp. ($82,000,000), Continental Maritime Lending GmbH ($72,000,000), Triton Credit Partners LP ($68,000,000), Laurentian Shipping Fund II ($55,000,000), Caspian Asset Management Ltd. ($40,000,000), and Pelagos Institutional Credit Fund ($26,000,000);
B. Original Mezzanine Notes. Concurrently with the closing of the Original Credit Agreement, TSL issued to Dralvecen Mezzanine Capital LLC original mezzanine notes in the aggregate principal amount of One Hundred Million Dollars ($100,000,000), bearing interest at a rate of 11.5% per annum on a payment-in-kind ("PIK") toggle basis, with an original maturity date of December 15, 2024 (the "Original Mezzanine Notes"). As of September 30, 2022, the outstanding balance of the Original Mezzanine Notes had grown to One Hundred Twelve Million Three Hundred Thousand Dollars ($112,300,000), reflecting the capitalization of Twelve Million Three Hundred Thousand Dollars ($12,300,000) of PIK interest. The Original Mezzanine Notes were secured by second-priority liens on the same collateral securing the First-Lien Obligations;
C. Original Intercreditor Agreement. The First-Lien Agent and the Second-Lien Holder entered into the Original Intercreditor Agreement, dated as of June 15, 2019 (the "Original Intercreditor Agreement"), which established the relative priorities, rights, and remedies of the First-Lien Agent and Dralvecen Mezzanine Capital LLC with respect to the shared collateral securing the First-Lien Obligations and the obligations under the Original Mezzanine Notes. The Original Intercreditor Agreement governed, among other things, lien priorities, standstill periods, enforcement rights, and the distribution waterfall applicable to proceeds of the shared collateral;
D. Restructuring and Exchange. TSL, TAI, Nordbank International AG (as agent), the consenting senior secured lenders constituting the Required Lenders under the Original Credit Agreement, Dralvecen Mezzanine Capital LLC, and KFO Holdings Société Anonyme (the controlling shareholder of TSL) entered into that certain Restructuring Support Agreement dated as of March 14, 2023 (the "RSA"). Pursuant to the RSA, the parties thereto agreed to implement, among other things: (i) Amendment No. 1 to the Senior Secured Credit Agreement (the "Amended Credit Agreement"), dated as of May 15, 2023, which, among other things, extends the maturity date of the First-Lien Obligations to June 15, 2027, converts Seventy-Five Million Dollars ($75,000,000) of Term Loan A principal to payment-in-kind, reduces the Revolving Credit Facility commitment from Two Hundred Million Dollars ($200,000,000) to One Hundred Fifty Million Dollars ($150,000,000), resets financial covenants, and provides for a 1.00% amendment fee in the amount of Five Million Four Hundred Thousand Dollars ($5,400,000) on a PIK basis; and (ii) an exchange of the existing One Hundred Twelve Million Three Hundred Thousand Dollar ($112,300,000) mezzanine notes for Sixty Million Dollars ($60,000,000) of new second-lien notes bearing interest at 10.0% PIK per annum, maturing in June 2028, together with 15% of the equity interests in TSL (the "Mezzanine Exchange"). The Mezzanine Exchange results in a 46.6% haircut on the debt component, calculated as ($112,300,000 − $60,000,000) ÷ $112,300,000. The outside date of the RSA was June 30, 2023, and the RSA Closing/Effective Date is June 30, 2023;
E. New Second-Lien Notes. In connection with the Mezzanine Exchange, TSL (as issuer) and Dralvecen Mezzanine Capital LLC (as purchaser) entered into that certain New Second-Lien Note Purchase Agreement dated as of May 18, 2023 (the "New Second-Lien Note Purchase Agreement"), and TSL and Garrison Trust Company (as indenture trustee) entered into that certain New Second-Lien Notes Indenture dated as of May 18, 2023 (the "New Second-Lien Notes Indenture"), governing the Sixty Million Dollar ($60,000,000) 10.0% PIK Second-Lien Notes due June 2028 (the "New Second-Lien Notes");
F. Amendment and Restatement. The Parties now desire to amend and restate the Original Intercreditor Agreement in its entirety to reflect the Mezzanine Exchange, the terms of the Amended Credit Agreement, and the issuance of the New Second-Lien Notes, and to set forth the revised intercreditor arrangements governing the relative rights and priorities of the First-Lien Obligations and the Second-Lien Obligations with respect to the Collateral (as defined herein); and
G. Consent of Grantors. TSL and TAI have consented to the execution and delivery of this Agreement and confirmed their respective obligations hereunder.
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations, and warranties set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I — DEFINITIONS AND INTERPRETATION
Section 1.01 — Definitions
As used in this Agreement, the following terms shall have the meanings set forth below:
"Amended Credit Agreement" means Amendment No. 1 to the Senior Secured Credit Agreement, dated as of May 15, 2023, among TSL, TAI, Nordbank International AG (as Administrative Agent and Collateral Agent), and the First-Lien Lenders party thereto, as the same may be further amended, supplemented, restated, or otherwise modified from time to time in accordance with the terms hereof and thereof.
"Bankruptcy Code" means Title 11 of the United States Code, 11 U.S.C. §§ 101 et seq., as amended from time to time.
"Collateral" means all assets and property of the Grantors that are subject to first-priority and second-priority liens securing the First-Lien Obligations and the Second-Lien Obligations, respectively, as more particularly described in Exhibit A hereto, including, without limitation: (a) thirty-eight (38) dry-bulk carriers; (b) twelve (12) container vessels; (c) TAI's leasehold interest in the Houston terminal lease; (d) all accounts receivable of TSL and TAI, whether now existing or hereafter arising; (e) 100% of the equity interests in TAI (held by TSL) and 100% of the equity interests in fourteen (14) vessel-owning special purpose vehicles; and (f) all other personal property, contract rights, and general intangibles related to the foregoing, in each case, as more fully described in the applicable security documents.
"Company" or "TSL" means Thalassa Shipping & Logistics Société Anonyme, a société anonyme organized under the laws of the Hellenic Republic.
"DIP Financing" means any debtor-in-possession financing authorized by a court of competent jurisdiction in connection with an Insolvency Proceeding.
"Discharge" has the meanings ascribed to it in Article XI hereof.
"First-Lien Agent" means Nordbank International AG, in its capacity as Administrative Agent and Collateral Agent under the Amended Credit Agreement, together with its successors and assigns in such capacity.
"First-Lien Claimholders" means, collectively, the First-Lien Agent and each First-Lien Lender.
"First-Lien Credit Documents" means the Amended Credit Agreement and all related security documents (including ship mortgages, security agreements, and pledge agreements), guarantees delivered by TAI and the vessel-owning SPVs, fee letters, and ancillary agreements executed and delivered in connection therewith, as each may be amended, supplemented, restated, or otherwise modified from time to time.
"First-Lien Lenders" means the nine (9) financial institutions party to the Amended Credit Agreement as lenders, being: Nordbank International AG (committed amount: $137,000,000), Aegean Capital Bank SA (committed amount: $110,000,000), Harborstone Bank plc (committed amount: $95,000,000), Pacifica Trade Finance Corp. (committed amount: $82,000,000), Continental Maritime Lending GmbH (committed amount: $72,000,000), Triton Credit Partners LP (committed amount: $68,000,000), Laurentian Shipping Fund II (committed amount: $55,000,000), Caspian Asset Management Ltd. (committed amount: $40,000,000), and Pelagos Institutional Credit Fund (committed amount: $26,000,000), together with their respective successors and assigns.
"First-Lien Obligations" means all obligations of the Grantors to the First-Lien Claimholders under or in connection with the First-Lien Credit Documents, whether now existing or hereafter arising, including all principal (being approximately $540,000,000 outstanding as of September 30, 2022, as adjusted by the terms of the Amended Credit Agreement), interest (including default interest), fees (including the amendment fee of $5,400,000 on a PIK basis), expenses, indemnification obligations, and all other amounts payable under the First-Lien Credit Documents, in each case, as such obligations may be amended, supplemented, restated, refinanced, or otherwise modified from time to time.
"Grantors" means, collectively, TSL and TAI, and each individually a "Grantor."
"Insolvency Proceeding" means any voluntary or involuntary proceeding under (a) the Bankruptcy Code, (b) Greek Law 4738/2020 (the Greek Debt Settlement and Insolvency Code, as amended), or (c) any other applicable insolvency, reorganization, receivership, liquidation, winding-up, composition, or similar law of any jurisdiction, in each case as the same may be amended from time to time, in respect of TSL, TAI, or any of their subsidiaries.
"Lien" means any mortgage, ship mortgage, pledge, hypothecation, security interest, encumbrance, charge, or other lien of any kind, whether voluntary or involuntary, and whether arising by operation of law or pursuant to contract.
"New Second-Lien Notes" or "Second-Lien Notes" means the Sixty Million Dollar ($60,000,000) aggregate principal amount of 10.0% PIK Second-Lien Notes due June 2028, issued by TSL to Dralvecen Mezzanine Capital LLC pursuant to the New Second-Lien Note Purchase Agreement and the New Second-Lien Notes Indenture.
"New Second-Lien Notes Indenture" means that certain Indenture dated as of May 18, 2023, between TSL (as issuer) and Garrison Trust Company (as indenture trustee), governing the New Second-Lien Notes, as the same may be amended, supplemented, or modified from time to time in accordance with the terms hereof and thereof.
"New Second-Lien Note Purchase Agreement" means that certain Note Purchase Agreement dated as of May 18, 2023, between TSL (as issuer) and Dralvecen Mezzanine Capital LLC (as purchaser), as the same may be amended, supplemented, or modified from time to time in accordance with the terms hereof and thereof.
"Original Credit Agreement" means the Senior Secured Credit Agreement dated as of June 15, 2019, among TSL, TAI, Nordbank International AG (as Administrative Agent and Collateral Agent), and the First-Lien Lenders party thereto, prior to giving effect to Amendment No. 1.
"Original Intercreditor Agreement" means that certain Intercreditor Agreement dated as of June 15, 2019, between Nordbank International AG (as First-Lien Agent) and Dralvecen Mezzanine Capital LLC (as second-lien holder), which is amended and restated in its entirety by this Agreement.
"RSA" means the Restructuring Support Agreement dated as of March 14, 2023, among TSL, TAI, Nordbank International AG (as agent), the consenting senior secured lenders, Dralvecen Mezzanine Capital LLC, and KFO Holdings Société Anonyme.
"Required First-Lien Lenders" has the meaning assigned to such term in the Amended Credit Agreement.
"Second-Lien Credit Documents" means the New Second-Lien Note Purchase Agreement, the New Second-Lien Notes Indenture, and all related security documents (including security agreements and pledge agreements granting second-priority liens on the Collateral), and all ancillary documents and certificates delivered in connection therewith, as each may be amended, supplemented, or modified from time to time in accordance with the terms hereof and thereof.
"Second-Lien Holder" or "Second-Lien Representative" means Dralvecen Mezzanine Capital LLC, a Delaware limited liability company, together with its successors and assigns.
"Second-Lien Obligations" means all obligations of the Grantors to the Second-Lien Holder under or in connection with the Second-Lien Credit Documents, whether now existing or hereafter arising, including all principal (being $60,000,000 as of the date hereof, subject to increase by capitalized PIK interest), interest (including PIK interest), fees, expenses, indemnification obligations, and all other amounts payable under the Second-Lien Credit Documents.
"Standstill Period" has the meaning assigned to such term in Section 3.01 hereof.
"U.S. Co-Borrower" or "TAI" means Thalassa Americas Inc., a corporation organized under the laws of the State of Delaware.
Section 1.02 — Rules of Construction
Unless the context otherwise requires: (a) headings and captions are for convenience of reference only and shall not affect the construction or interpretation of any provision hereof; (b) the word "including" (and with correlative meaning, "include" and "includes") means including without limiting the generality of any description preceding such term; (c) references to "Sections," "Articles," and "Exhibits" are to sections, articles, and exhibits of this Agreement unless otherwise specified; (d) words importing the singular shall include the plural and vice versa; (e) the words "herein," "hereof," "hereunder," and words of similar import refer to this Agreement as a whole and not to any particular provision; (f) all references to currency amounts are to lawful money of the United States of America unless otherwise expressly specified; (g) references to any law, statute, or regulation shall be deemed to include all amendments thereto and all successor statutes and regulations; (h) references to any agreement, instrument, or document shall be deemed to include all amendments, supplements, restatements, and modifications thereto; and (i) references to "days" shall mean calendar days unless expressly stated to be "business days."
Section 1.03 — CUSIP References
For informational purposes only, the following CUSIP numbers are referenced herein:
• Term Loan A under the Amended Credit Agreement: CUSIP 87265BAA7
• Unsecured Notes (for reference only; not subject to this Agreement): CUSIP 87265BAB5
The inclusion of CUSIP numbers herein is for convenience only and shall not be deemed to create any obligation or affect the interpretation of any term of this Agreement.
ARTICLE II — LIEN PRIORITIES
Section 2.01 — Relative Priorities of Liens
Notwithstanding the date, time, manner, method, or order of grant, attachment, filing, recordation, or perfection of any Lien or security interest granted to the First-Lien Agent or the Second-Lien Holder, and notwithstanding any provision of the Uniform Commercial Code or any applicable law, or any First-Lien Credit Document or Second-Lien Credit Document, or any defect in or non-perfection of any Lien or security interest, or any other circumstance whatsoever:
(a) All Liens on the Collateral securing the First-Lien Obligations shall at all times be and remain senior and prior in right to all Liens on the Collateral securing the Second-Lien Obligations; and
(b) All Liens on the Collateral securing the Second-Lien Obligations shall at all times be and remain junior and subordinate in all respects to all Liens on the Collateral securing the First-Lien Obligations.
The priority of the Liens established by this Section 2.01 is not based on the date, time, or order of perfection or filing of any financing statement, ship mortgage, or other document, but rather on the agreement of the Parties as set forth herein. Each of the First-Lien Agent and the Second-Lien Holder acknowledges and agrees that the priority established hereby shall be effective regardless of whether any Lien is valid, perfected, avoidable, or otherwise subject to challenge.
Section 2.02 — Nature of First-Lien Obligations Secured
The first-priority Liens on the Collateral secure all First-Lien Obligations, as such obligations exist from time to time, including without limitation the obligations arising under the Amended Credit Agreement as in effect from time to time. As of the date hereof, the First-Lien Obligations include, without limitation: (a) the extended maturity date of June 15, 2027; (b) interest accruing at SOFR plus 375 basis points per annum; (c) the Seventy-Five Million Dollar ($75,000,000) Term Loan A PIK conversion; (d) the reduced Revolving Credit Facility commitment of One Hundred Fifty Million Dollars ($150,000,000); (e) the amendment fee of Five Million Four Hundred Thousand Dollars ($5,400,000) on a PIK basis; (f) all other fees, expenses, and indemnification obligations; and (g) all other obligations arising under the Amended Credit Agreement and the other First-Lien Credit Documents, in each case, as the same may be amended, supplemented, restated, or otherwise modified from time to time. The first-priority Liens secure the full amount of all First-Lien Obligations, whether arising before or after the date hereof, and whether arising under the Original Credit Agreement (as amended) or any refinancing, extension, renewal, or replacement thereof permitted hereunder.
Section 2.03 — Nature of Second-Lien Obligations Secured
The second-priority Liens on the Collateral secure all Second-Lien Obligations, including without limitation: (a) the principal amount of the New Second-Lien Notes in the amount of Sixty Million Dollars ($60,000,000); (b) all PIK interest accruing at 10.0% per annum that may accrue and be capitalized from time to time in accordance with the terms of the New Second-Lien Notes Indenture; (c) the maturity date of June 2028; and (d) all other fees, expenses, indemnification obligations, and other amounts payable under the Second-Lien Credit Documents, in each case, as the same may be amended, supplemented, or modified from time to time in accordance with the terms hereof.
Section 2.04 — Prohibition on Contesting Liens
The Second-Lien Holder agrees that it shall not (and hereby waives any right to) contest, challenge, object to, or raise any defense to the validity, perfection, priority, or enforceability of any first-priority Lien on the Collateral securing the First-Lien Obligations, whether in any judicial, administrative, or other proceeding, including any Insolvency Proceeding, or otherwise. The First-Lien Agent agrees that it shall not (and hereby waives any right to) contest, challenge, object to, or raise any defense to the validity, perfection, priority, or enforceability of any second-priority Lien on the Collateral securing the Second-Lien Obligations, whether in any judicial, administrative, or other proceeding, including any Insolvency Proceeding, or otherwise. Nothing in this Section 2.04 shall be construed to prevent either the First-Lien Agent or the Second-Lien Holder from contesting the amount, calculation, or existence of any obligation purportedly secured by such Liens.
Section 2.05 — No New Liens
Neither the Grantors nor any Party hereto shall grant, create, or permit to exist any Lien on the Collateral that ranks pari passu with or senior to the first-priority Liens securing the First-Lien Obligations, or that ranks pari passu with or senior to the second-priority Liens securing the Second-Lien Obligations, in each case except as expressly permitted under the Amended Credit Agreement or the New Second-Lien Notes Indenture. Without limiting the generality of the foregoing, the Grantors shall not grant any Lien on the Collateral to secure any indebtedness other than the First-Lien Obligations and the Second-Lien Obligations except for Permitted Liens (as defined in the Amended Credit Agreement) and any DIP Financing Liens authorized in accordance with Article IV hereof.
ARTICLE III — ENFORCEMENT RIGHTS AND STANDSTILL
Section 3.01 — Standstill on Second-Lien Enforcement
Until the First-Lien Obligations have been Discharged in full, the Second-Lien Holder agrees that it shall not exercise or seek to exercise any rights or remedies (including setoff or recoupment) with respect to the Collateral (including, without limitation, foreclosure, collection, sale, lease, assignment, or other realization upon any Collateral, whether by judicial action, self-help, notification to account debtors, or otherwise) for a period of one hundred eighty (180) days (the "Standstill Period") following delivery by the Second-Lien Holder to the First-Lien Agent of a written notice (a "Standstill Notice") certifying that an event of default under the Second-Lien Credit Documents has occurred and is continuing and that the Second-Lien Holder desires to exercise enforcement remedies with respect to the Collateral. The Standstill Notice shall specify in reasonable detail the nature of the event of default giving rise to the exercise of remedies.
Notwithstanding the foregoing, the Standstill Period shall terminate earlier than the one hundred eighty (180) day period described above upon the occurrence of any of the following:
(a) If the First-Lien Agent has not commenced any enforcement action with respect to any material portion of the Collateral within such one hundred eighty (180) day period;
(b) If an Insolvency Proceeding has been commenced by or against TSL, TAI, or any material subsidiary thereof during such one hundred eighty (180) day period; or
(c) If the First-Lien Obligations have been Discharged in full during such one hundred eighty (180) day period.
Following the expiration or earlier termination of the Standstill Period, the Second-Lien Holder may exercise enforcement remedies with respect to the Collateral in accordance with the terms of the Second-Lien Credit Documents, subject in all respects to the lien priorities, payment waterfall, and other provisions of this Agreement.
Section 3.02 — First-Lien Agent's Right to Enforce
Until the First-Lien Obligations have been Discharged in full, the First-Lien Agent (acting at the direction of the Required First-Lien Lenders, or as otherwise authorized under the Amended Credit Agreement) shall have the exclusive right to enforce rights and remedies against the Collateral, including the right to foreclose upon, sell, collect, or otherwise realize upon any Collateral, to exercise rights of set-off against the Collateral, to notify account debtors with respect to accounts receivable constituting Collateral, and to take any other enforcement action with respect to the Collateral. The exercise by the First-Lien Agent of any such rights and remedies shall not be subject to the consent or approval of the Second-Lien Holder.
The First-Lien Agent shall have the sole and exclusive right to determine the time, manner, and method of any enforcement action with respect to the Collateral, and shall not be required to consult with or obtain the consent of the Second-Lien Holder in connection therewith, provided that the First-Lien Agent shall use commercially reasonable efforts to provide the Second-Lien Holder with reasonable notice prior to any material enforcement action.
Section 3.03 — Cooperation in Enforcement
If the First-Lien Agent exercises enforcement remedies with respect to the Collateral, the Second-Lien Holder shall cooperate with the First-Lien Agent and shall not object to, interfere with, or delay any such enforcement. Without limiting the generality of the foregoing, the Second-Lien Holder shall:
(a) Upon written request of the First-Lien Agent, execute and deliver, at the expense of the Grantors, such releases, termination statements, and other instruments as the First-Lien Agent may reasonably request in connection with any enforcement action;
(b) Release its second-priority Liens on any specific item of Collateral that is disposed of in connection with an enforcement action by the First-Lien Agent (including any sale, transfer, or other disposition), with any proceeds attributable to the Second-Lien Obligations being distributed in accordance with the waterfall set forth in Article V hereof; and
(c) Refrain from taking any action that would hinder, delay, impede, or interfere with any enforcement action by the First-Lien Agent.
Section 3.04 — Waiver of marshalling
The Second-Lien Holder hereby waives any right it may have to require the marshalling of assets, to require the First-Lien Agent to proceed against any particular item of Collateral before proceeding against any other item, or to require the First-Lien Agent to apply the proceeds of any Collateral in any particular order. The Second-Lien Holder acknowledges that the First-Lien Agent may, in its sole discretion, select the order and manner in which Collateral is realized upon.
Section 3.05 — Insurance and Condemnation Proceeds
All insurance proceeds and condemnation awards or other payments received with respect to any Collateral, including without limitation proceeds of hull and machinery insurance, protection and indemnity insurance, loss-of-hire insurance, and any condemnation or eminent domain awards, shall be applied first to the First-Lien Obligations until such obligations are Discharged in full, and thereafter to the Second-Lien Obligations. For the avoidance of doubt, this provision shall apply to the entire fleet of TSL and TAI consisting of thirty-eight (38) dry-bulk carriers (comprising ten (10) Capesize vessels with an appraised aggregate value of $215,000,000, fourteen (14) Panamax vessels with an appraised aggregate value of $182,000,000, and fourteen (14) Supramax vessels with an appraised aggregate value of $128,000,000) and twelve (12) Sub-Panamax container vessels with an appraised aggregate value of $98,000,000, resulting in a total appraised fleet value of Six Hundred Twenty-Three Million Dollars ($623,000,000) as of November 1, 2022, as determined by Drakos Maritime Valuations Ltd. The Second-Lien Holder acknowledges that insurance and condemnation proceeds may be applied to the First-Lien Obligations in a manner determined by the First-Lien Agent without the consent of the Second-Lien Holder.
ARTICLE IV — INSOLVENCY PROCEEDINGS
Section 4.01 — Lien Priorities in Insolvency Proceedings
The lien priorities established in Article II of this Agreement shall apply in full force and effect in any Insolvency Proceeding, whether under the Bankruptcy Code, Greek Law 4738/2020 (the Greek Debt Settlement and Insolvency Code, as amended), or any other applicable insolvency, reorganization, or liquidation law of any jurisdiction. The Second-Lien Holder shall not, in any Insolvency Proceeding, seek, vote for, or support any plan of reorganization, arrangement, composition, or other resolution that does not provide for the priority of the First-Lien Obligations over the Second-Lien Obligations with respect to the Collateral, as established by this Agreement. Without limiting the generality of the foregoing, the Second-Lien Holder agrees that it shall not vote in favor of any plan of reorganization that proposes to distribute any proceeds of Collateral to the Second-Lien Holder unless and until all First-Lien Obligations have been Discharged in full.
Section 4.02 — DIP Financing
The Second-Lien Holder hereby consents to, and shall not object to or oppose, any DIP Financing that is consented to by the First-Lien Agent (acting at the direction of the Required First-Lien Lenders), including any DIP Financing that is secured by Liens on the Collateral that prime the Second-Lien Holder's Liens, provided that:
(a) The aggregate principal amount of the DIP Financing, together with the outstanding First-Lien Obligations, does not exceed the sum of (i) the then-outstanding First-Lien Obligations, plus (ii) the principal amount of the DIP Financing;
(b) The Second-Lien Holder retains a junior Lien on the Collateral, which junior Lien shall be subordinate to the DIP Financing Liens and the first-priority Liens securing the First-Lien Obligations, but senior to any unsecured claims; and
(c) The terms of the DIP Financing are not materially more onerous to the Grantors than the contingency DIP term sheet parameters previously discussed among the Parties, which, for reference purposes and without creating any binding obligation, contemplated a facility in the amount of Seventy-Five Million Dollars ($75,000,000), bearing interest at SOFR plus 600 basis points, with a 0.50% commitment fee and a twelve (12) month maturity.
For the avoidance of doubt, the parameters set forth in clause (c) above are for reference purposes only and shall not constitute a binding commitment to provide DIP Financing or a condition to the Second-Lien Holder's consent to DIP Financing.
Section 4.03 — Adequate Protection
In any Insolvency Proceeding, the Second-Lien Holder shall not seek or accept adequate protection with respect to the Second-Lien Obligations other than a replacement Lien on the Collateral that is junior in priority to (a) all first-priority Liens securing the First-Lien Obligations, (b) any Liens securing DIP Financing consented to by the First-Lien Agent, and (c) any adequate protection Liens granted to the First-Lien Claimholders. The Second-Lien Holder shall not seek adequate protection in the form of cash payments, periodic payments, or any other form of adequate protection that would diminish the value of the Collateral available to satisfy the First-Lien Obligations. The Second-Lien Holder shall not object to any adequate protection provided to the First-Lien Claimholders in any Insolvency Proceeding, including, without limitation, any replacement Liens, cash payments, or superpriority administrative claims granted to the First-Lien Claimholders.
Section 4.04 — Relief from Automatic Stay
The Second-Lien Holder shall not seek relief from the automatic stay imposed by Section 362 of the Bankruptcy Code, or any analogous provision under Greek Law 4738/2020 or any other applicable insolvency law, with respect to any Collateral, unless and until the First-Lien Agent has first obtained such relief or has consented in writing to the Second-Lien Holder's request for such relief. The Second-Lien Holder shall not oppose or object to any motion or request by the First-Lien Agent for relief from the automatic stay with respect to any Collateral.
Section 4.05 — Post-Petition Interest
The Second-Lien Holder acknowledges and agrees that in any Insolvency Proceeding, post-petition interest, fees, costs, charges, and other amounts accruing on the Second-Lien Obligations may be limited, disallowed, or subordinated in accordance with applicable law, and the Second-Lien Holder shall not object to or contest the allowance of post-petition interest, fees, costs, and other charges on the First-Lien Obligations to the extent permitted by applicable law. The Second-Lien Holder further agrees that, to the extent the value of the Collateral is sufficient to provide for the payment of post-petition interest on the First-Lien Obligations but not on the Second-Lien Obligations, post-petition interest on the First-Lien Obligations shall be allowed and paid before any post-petition interest on the Second-Lien Obligations.
Section 4.06 — No Substantive Consolidation Challenge
Neither the First-Lien Agent nor the Second-Lien Holder shall seek the substantive consolidation of the bankruptcy estates of TSL and TAI, or any other Grantor or subsidiary, in any Insolvency Proceeding, in a manner that would alter or adversely affect the lien priorities and intercreditor arrangements established by this Agreement. Nothing in this Section 4.06 shall prevent either Party from asserting or defending against claims for substantive consolidation raised by third parties.
Section 4.07 — Cross-Border Insolvency
In the event that an Insolvency Proceeding is commenced under Greek Law 4738/2020 or any other non-U.S. insolvency law, and recognition of such proceeding is sought under Chapter 15 of the Bankruptcy Code or under any other applicable law providing for the recognition of foreign insolvency proceedings, the lien priorities, intercreditor arrangements, and other provisions of this Agreement shall continue to apply in full force and effect. The Second-Lien Holder shall not object to or oppose the recognition of any foreign proceeding if the First-Lien Agent supports such recognition, including any request for recognition of a foreign main proceeding or foreign nonmain proceeding. The Parties acknowledge that TSL is organized under the laws of the Hellenic Republic and maintains its center of main interests in Greece, and that TAI is organized under the laws of Delaware and maintains its center of main interests in the United States, and that an Insolvency Proceeding may be commenced in one or both jurisdictions.
Section 4.08 — Asset Sales in Insolvency
If any Collateral is sold, transferred, or otherwise disposed of pursuant to Section 363 of the Bankruptcy Code, or pursuant to any analogous provision of Greek Law 4738/2020 or any other applicable insolvency law, the Second-Lien Holder shall consent to such sale free and clear of its second-priority Liens, provided that the proceeds of such sale are applied in accordance with the waterfall set forth in Article V hereof. Without limiting the generality of the foregoing, the Parties acknowledge that the Side Letter Agreement: Vessel Disposition Undertaking dated March 14, 2023, contemplates the sale of six (6) older dry-bulk carriers (with an average age of approximately eighteen (18) years and estimated aggregate proceeds of approximately Seventy-Two Million Dollars ($72,000,000)), with net proceeds applied to prepay the Term Loan A under the Amended Credit Agreement. To the extent any such sale occurs in the context of an Insolvency Proceeding, the provisions of this Section 4.08 shall apply, and the Second-Lien Holder shall not object to or interfere with such sale.
ARTICLE V — APPLICATION OF PROCEEDS AND PAYMENT WATERFALL
Section 5.01 — Waterfall
All proceeds received from the sale, collection, foreclosure, or other realization upon any Collateral (including insurance and condemnation proceeds), and all distributions received in any Insolvency Proceeding with respect to any Collateral, shall be applied in the following order of priority:
First: To the First-Lien Agent, for the payment of all reasonable and documented costs and expenses of enforcement and administration incurred by the First-Lien Agent in connection with the exercise of its rights and remedies hereunder and under the First-Lien Credit Documents, including attorneys' fees, appraisal costs, consultant fees, and other costs of collection, enforcement, and administration;
Second: To the First-Lien Claimholders, for the payment of all First-Lien Obligations (including principal, which as of the date hereof is approximately Five Hundred Forty Million Dollars ($540,000,000) as outstanding and as adjusted by the terms of the Amended Credit Agreement, together with all accrued and unpaid interest (including default interest), fees (including the amendment fee of $5,400,000 on a PIK basis), indemnification obligations, and all other amounts owing under the Amended Credit Agreement and the other First-Lien Credit Documents), until the First-Lien Obligations are Discharged in full;
Third: To the Second-Lien Holder, for the payment of all reasonable and documented costs and expenses of enforcement attributable to the Second-Lien Credit Documents, including attorneys' fees, appraisal costs, and other costs of collection incurred by the Second-Lien Holder;
Fourth: To the Second-Lien Holder, for the payment of all Second-Lien Obligations (including principal, which as of the date hereof is Sixty Million Dollars ($60,000,000), together with all accrued and capitalized PIK interest at 10.0% per annum, fees, and all other amounts owing under the New Second-Lien Notes Indenture and the other Second-Lien Credit Documents), until the Second-Lien Obligations are Discharged in full; and
Fifth: To the Grantors or their successors or assigns, or to such other person as a court of competent jurisdiction may direct, for application in accordance with applicable law.
Section 5.02 — Turnover
If the Second-Lien Holder receives any payment, distribution, or proceeds on account of the Collateral or in respect of the Second-Lien Obligations in contravention of the waterfall set forth in Section 5.01, whether by direct payment, setoff, enforcement, or otherwise, the Second-Lien Holder shall hold such payment, distribution, or proceeds in trust for the benefit of the First-Lien Claimholders and shall promptly turn over and deliver such amounts to the First-Lien Agent for application in accordance with Section 5.01. Until such turnover is effected, the Second-Lien Holder shall segregate such amounts in a separate account and shall not commingle such amounts with any other funds. The First-Lien Agent shall be authorized to apply any amounts received pursuant to this Section 5.02 in accordance with Section 5.01.
Section 5.03 — Subrogation
Following the Discharge of all First-Lien Obligations, the Second-Lien Holder shall be subrogated to the rights of the First-Lien Claimholders to the extent of any payments or distributions made by the Second-Lien Holder that were turned over to the First-Lien Agent pursuant to Section 5.02 hereof. Such subrogation rights shall only become effective after the Discharge of all First-Lien Obligations in full, and until such Discharge, the Second-Lien Holder shall not exercise or assert any subrogation rights.
ARTICLE VI — MODIFICATIONS TO FIRST-LIEN AND SECOND-LIEN DOCUMENTS
Section 6.01 — Amendments to First-Lien Credit Documents
The First-Lien Agent and the First-Lien Lenders may, without the consent of the Second-Lien Holder, and without notice to the Second-Lien Holder (except as otherwise required by this Agreement), amend, supplement, restate, refinance, replace, or otherwise modify the First-Lien Credit Documents in any manner, including, without limitation:
(a) Changes to the applicable interest rate, default rate, fees, fee structure, or other pricing terms;
(b) Changes to the maturity date, amortization schedule, or mandatory or voluntary prepayment terms;
(c) Changes to financial covenants, negative covenants, affirmative covenants, events of default, or definitions;
(d) Increases in the aggregate principal amount of the First-Lien Obligations, provided that the total outstanding First-Lien Obligations (including unfunded commitments) shall not exceed Six Hundred Eighty-Five Million Dollars ($685,000,000) (being the original total commitment amount) plus any permitted PIK capitalization and fees accrued in accordance with the terms of the Amended Credit Agreement;
(e) Changes to the collateral package (including additions of collateral); and
(f) Any other amendment, modification, or supplement of any kind.
For the avoidance of doubt, the Parties acknowledge that Amendment No. 1 to the Senior Secured Credit Agreement, dated as of May 15, 2023, included the following modifications: (i) extension of the maturity date to June 15, 2027; (ii) conversion of Seventy-Five Million Dollars ($75,000,000) of Term Loan A principal to PIK; (iii) reduction of the Revolving Credit Facility commitment from Two Hundred Million Dollars ($200,000,000) to One Hundred Fifty Million Dollars ($150,000,000); (iv) covenant resets, including a maximum net leverage ratio of 7.00x, stepping down to 5.50x by the fourth quarter of 2025, a minimum liquidity requirement of Thirty Million Dollars ($30,000,000), and a waiver of the interest coverage ratio through the fourth quarter of 2023; (v) an amendment fee of Five Million Four Hundred Thousand Dollars ($5,400,000) on a PIK basis; and (vi) a retroactive waiver of default interest. All such amendments are expressly permitted without the consent of the Second-Lien Holder, and the Second-Lien Holder hereby acknowledges and agrees that it has no objection to any of the foregoing amendments.
Section 6.02 — Amendments to Second-Lien Credit Documents
The Second-Lien Holder may amend, supplement, or modify the Second-Lien Credit Documents without the consent of the First-Lien Agent, provided that no such amendment, supplement, or modification shall:
(a) Increase the aggregate principal amount of the Second-Lien Obligations above Sixty Million Dollars ($60,000,000) plus accumulated PIK interest accrued and capitalized in accordance with the original terms of the New Second-Lien Notes Indenture;
(b) Shorten the stated maturity of the New Second-Lien Notes to a date earlier than June 2028;
(c) Increase the interest rate applicable to the New Second-Lien Notes above 10.0% PIK per annum;
(d) Add new collateral to secure the Second-Lien Obligations or alter the lien priority arrangements in a manner inconsistent with this Agreement;
(e) Amend any provision of the Second-Lien Credit Documents in a manner that would contravene, be inconsistent with, or undermine any provision of this Agreement; or
(f) Add any covenant, event of default, or other term that would be more restrictive on the Grantors than the corresponding terms of the Amended Credit Agreement, to the extent such term relates to matters addressed in this Agreement.
Section 6.03 — Amendments to This Agreement
This Agreement may be amended, supplemented, restated, or otherwise modified only by a written instrument signed by the First-Lien Agent and the Second-Lien Holder. The consent of the Grantors shall be required only to the extent any such amendment, supplement, or modification directly and adversely affects the obligations, rights, or duties of the Grantors under this Agreement. No waiver of any provision of this Agreement shall be effective unless in writing and signed by the Party against whom such waiver is sought to be enforced.
ARTICLE VII — PURCHASE OPTION
Section 7.01 — Second-Lien Holder Purchase Option
The Second-Lien Holder shall have the option (but not the obligation), exercisable within ten (10) business days following receipt of a written notice from the First-Lien Agent (a "Pre-Enforcement Notice") that (a) the First-Lien Agent intends to commence enforcement action with respect to the Collateral, or (b) an Insolvency Proceeding has been commenced by or against TSL, TAI, or any material subsidiary thereof, to purchase all (but not less than all) of the First-Lien Obligations at par, plus all accrued and unpaid interest, fees, and expenses then outstanding under the First-Lien Credit Documents, by delivering written notice to the First-Lien Agent of its election to exercise such option (a "Purchase Election Notice").
Upon the consummation of such purchase, the Second-Lien Holder shall become the First-Lien Agent and shall assume all rights, powers, and remedies of the First-Lien Agent and the First-Lien Claimholders under the First-Lien Credit Documents, as if it had been the original holder thereof. The closing of any such purchase shall occur within fifteen (15) business days following delivery of the Purchase Election Notice, at which time the First-Lien Agent and the First-Lien Lenders shall execute and deliver such documents as are reasonably necessary to assign and transfer the First-Lien Obligations to the Second-Lien Holder. The purchase price shall be payable in immediately available funds.
Section 7.02 — First-Lien Agent Purchase Option
The First-Lien Agent (acting at the direction of the Required First-Lien Lenders) shall have the option (but not the obligation), exercisable upon (a) the occurrence and continuance of an event of default under the Second-Lien Credit Documents, and (b) the commencement of enforcement action by the Second-Lien Holder with respect to the Collateral (including the delivery of a Standstill Notice pursuant to Section 3.01), to purchase all (but not less than all) of the Second-Lien Obligations at par, plus all accrued and unpaid interest (including capitalized PIK interest), fees, and expenses then outstanding under the Second-Lien Credit Documents, by delivering written notice to the Second-Lien Holder of its election to exercise such option. The closing of any such purchase shall occur within fifteen (15) business days following delivery of such notice, and the Second-Lien Holder shall execute and deliver such documents as are reasonably necessary to assign and transfer the Second-Lien Obligations to the First-Lien Agent or its designee.
ARTICLE VIII — RELEASES
Section 8.01 — Release of Second-Lien Liens upon Collateral Disposition
If the First-Lien Agent releases or agrees to release its first-priority Liens on any item of Collateral in connection with a permitted disposition under the Amended Credit Agreement, the Second-Lien Holder's second-priority Liens on such item of Collateral shall be automatically and simultaneously released without any further action by or consent of the Second-Lien Holder. The Second-Lien Holder hereby irrevocably authorizes the First-Lien Agent to execute and deliver, on behalf of the Second-Lien Holder, any releases, termination statements, or other documents necessary to evidence such release.
Without limiting the generality of the foregoing, the provisions of this Section 8.01 shall apply to any sale, transfer, or other disposition of Collateral permitted under the Amended Credit Agreement, including, without limitation, the sale of six (6) dry-bulk carriers contemplated by the Side Letter Agreement: Vessel Disposition Undertaking dated as of March 14, 2023. Any proceeds of such dispositions shall be applied in accordance with the terms of the Amended Credit Agreement and the waterfall set forth in Article V hereof.
Section 8.02 — Release upon Discharge of First-Lien Obligations
Upon the Discharge of all First-Lien Obligations, the first-priority Liens on the Collateral securing the First-Lien Obligations shall be automatically released, and the Second-Lien Holder's second-priority Liens on the Collateral shall become first-priority Liens thereon. The First-Lien Agent shall, promptly following such Discharge, execute and deliver to the Second-Lien Holder (or to the Grantors, as applicable) such releases, termination statements, mortgage discharges, and other documents as may be reasonably necessary to evidence the release of the first-priority Liens and to confirm that the Second-Lien Holder's Liens have become first-priority Liens on the Collateral.
Section 8.03 — Release upon Discharge of Second-Lien Obligations
Upon the Discharge of all Second-Lien Obligations, the Liens on the Collateral securing the Second-Lien Obligations shall be automatically released without any further action by any Party. The Second-Lien Holder shall, promptly following such Discharge, execute and deliver to the Grantors such releases, termination statements, and other documents as may be reasonably necessary to evidence the release of the second-priority Liens.
ARTICLE IX — REPRESENTATIONS AND WARRANTIES
Section 9.01 — Representations of the First-Lien Agent
Nordbank International AG represents and warrants to the Second-Lien Holder and the Grantors, as of the date hereof, as follows:
(a) Organization and Good Standing. Nordbank International AG is an Aktiengesellschaft duly organized and validly existing under the laws of Switzerland, and has all requisite corporate power and authority to carry on its business as presently conducted.
(b) Authority. Nordbank International AG has all necessary corporate power and authority to execute, deliver, and perform its obligations under this Agreement. The execution, delivery, and performance of this Agreement have been duly authorized by all necessary corporate action on the part of Nordbank International AG.
(c) Binding Obligation. This Agreement constitutes the legal, valid, and binding obligation of Nordbank International AG, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rights generally and to general principles of equity.
(d) No Conflict. The execution, delivery, and performance of this Agreement do not and will not conflict with, violate, or result in a breach of any provision of (i) the organizational documents of Nordbank International AG, (ii) any material agreement to which Nordbank International AG is a party, or (iii) any applicable law, rule, regulation, or order binding upon Nordbank International AG.
(e) Capacity. Nordbank International AG is acting in its capacity as Administrative Agent and Collateral Agent under the Amended Credit Agreement, and has been duly authorized by the Required First-Lien Lenders to enter into this Agreement on behalf of the First-Lien Claimholders.
Section 9.02 — Representations of the Second-Lien Holder
Dralvecen Mezzanine Capital LLC represents and warrants to the First-Lien Agent and the Grantors, as of the date hereof, as follows:
(a) Organization and Good Standing. Dralvecen Mezzanine Capital LLC is a limited liability company duly organized and validly existing under the laws of the State of Delaware, and has all requisite limited liability company power and authority to carry on its business as presently conducted.
(b) Authority. Dralvecen Mezzanine Capital LLC has all necessary limited liability company power and authority to execute, deliver, and perform its obligations under this Agreement. The execution, delivery, and performance of this Agreement have been duly authorized by all necessary limited liability company action, including authorization by Rebecca Marsh, Senior Partner.
(c) Binding Obligation. This Agreement constitutes the legal, valid, and binding obligation of Dralvecen Mezzanine Capital LLC, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rights generally and to general principles of equity.
(d) No Conflict. The execution, delivery, and performance of this Agreement do not and will not conflict with, violate, or result in a breach of any provision of (i) the organizational documents of Dralvecen Mezzanine Capital LLC, (ii) any material agreement to which Dralvecen Mezzanine Capital LLC is a party, or (iii) any applicable law, rule, regulation, or order binding upon Dralvecen Mezzanine Capital LLC.
(e) Sole Holder. Dralvecen Mezzanine Capital LLC is the sole holder of the New Second-Lien Notes in the aggregate principal amount of Sixty Million Dollars ($60,000,000), and no other person holds any interest in the New Second-Lien Notes or the Second-Lien Obligations.
Section 9.03 — Representations of the Grantors
Each of the Grantors represents and warrants to the First-Lien Agent and the Second-Lien Holder, as of the date hereof, as follows:
(a) TSL — Organization and Good Standing. TSL is a société anonyme duly organized and validly existing under the laws of the Hellenic Republic, registered with the Athens General Commercial Registry, and bearing Greek Tax Identification Number (AFM) 998214763. TSL has all requisite corporate power and authority to execute, deliver, and perform its obligations under this Agreement.
(b) TAI — Organization and Good Standing. TAI is a corporation duly incorporated and validly existing under the laws of the State of Delaware, with Employer Identification Number (EIN) 84-3291057, and maintains its registered agent at Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, DE 19801. TAI has all requisite corporate power and authority to execute, deliver, and perform its obligations under this Agreement.
(c) Authority and Binding Obligation. The execution, delivery, and performance of this Agreement by each Grantor have been duly authorized by all necessary corporate action. This Agreement constitutes the legal, valid, and binding obligation of each Grantor, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rights generally and to general principles of equity.
(d) No Conflict. The execution, delivery, and performance of this Agreement by each Grantor do not and will not conflict with, violate, or result in a breach of any provision of (i) the organizational documents of such Grantor, (ii) any material agreement to which such Grantor is a party, or (iii) any applicable law, rule, regulation, or order binding upon such Grantor.
ARTICLE X — ADDITIONAL COVENANTS
Section 10.01 — Information Sharing
The First-Lien Agent shall, upon written request by the Second-Lien Holder (such requests to be made no more frequently than quarterly), provide the Second-Lien Holder with written notice of: (a) any event of default that has occurred and is continuing under the Amended Credit Agreement; (b) any acceleration of the First-Lien Obligations; and (c) any enforcement action that has been taken or is proposed to be taken by the First-Lien Agent with respect to the Collateral. The First-Lien Agent shall have no liability for any failure to provide such information except in the case of gross negligence or willful misconduct. The Second-Lien Holder shall treat all information received pursuant to this Section 10.01 as confidential and shall not disclose such information to any third party except to its professional advisors on a need-to-know basis, or as required by applicable law or regulation.
Section 10.02 — Further Assurances
Each Party hereto shall promptly execute and deliver such additional documents, instruments, and agreements, and take such further actions, as may be reasonably necessary or appropriate to effectuate the purposes and intent of this Agreement, including without limitation: (a) any filings with the U.S. Securities and Exchange Commission; (b) any filings with any Secretary of State or other state governmental authority; (c) any filings or registrations in any non-U.S. jurisdiction; and (d) any other actions as may be reasonably requested by any other Party to carry out the terms and provisions of this Agreement.
Section 10.03 — Covenant of Grantors
Each of the Grantors covenants and agrees that it shall not grant, create, or permit to exist any Lien on the Collateral except (a) Liens permitted by the Amended Credit Agreement, (b) Liens permitted by the New Second-Lien Notes Indenture, and (c) Liens that are consistent with the lien priorities established in this Agreement. The Grantors shall promptly notify the First-Lien Agent and the Second-Lien Holder of any Lien that comes into existence on any Collateral other than Liens permitted by this Section 10.03.
Section 10.04 — Intercompany Note Subordination
The Parties acknowledge that the Seventy-Six Million Four Hundred Thousand Dollar ($76,400,000) amended and restated intercompany promissory note from TAI to TSL (as amended, with a maturity date of December 2028 and an interest rate of 2.0% per annum) (the "Intercompany Note") is and shall remain fully subordinated to all First-Lien Obligations and all Second-Lien Obligations. No payment of principal, interest, or any other amount on the Intercompany Note shall be made at any time when an event of default has occurred and is continuing under the Amended Credit Agreement or the New Second-Lien Notes Indenture, or if such payment would result in an event of default under either such agreement.
ARTICLE XI — DISCHARGE