DRAFT — FOR CONTINGENCY PLANNING PURPOSES ONLY — NOT FOR FILING
UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
DEBTOR'S MOTION FOR ENTRY OF AN ORDER AUTHORIZING THE DEBTOR TO (I) CONTINUE AND MAINTAIN ITS PREPETITION INSURANCE POLICIES, SURETY BONDS, AND RELATED AGREEMENTS, (II) PAY ALL PREPETITION OBLIGATIONS ARISING THEREUNDER, AND (III) HONOR ALL PREMIUM FINANCING OBLIGATIONS IN THE ORDINARY COURSE OF BUSINESS
Thalassa Americas Inc. ("TAI" or the "Debtor"), the above-captioned debtor and debtor in possession, by and through its proposed counsel, Calderwood & Harkness LLP, respectfully submits this motion (the "Motion") pursuant to Sections 105(a), 363(b), and 365 of title 11 of the United States Code (the "Bankruptcy Code") and Rules 6003 and 6004 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), for entry of an order, substantially in the form attached hereto as Exhibit A (the "Proposed Order"), authorizing the Debtor to (i) continue and maintain its prepetition insurance policies, surety bonds, and related agreements (collectively, the "Insurance Policies"), (ii) pay all prepetition obligations arising thereunder, including premiums, deductibles, self-insured retentions, and related administrative charges, and (iii) honor all premium financing obligations in the ordinary course of business. In support of this Motion, the Debtor respectfully represents as follows:
I. PRELIMINARY STATEMENT
1. Thalassa Americas Inc. is a Delaware C-Corporation with its principal office located at 1400 McKinney Street, Suite 2200, Houston, Texas 77010 (EIN: 84-3291057). TAI is the wholly-owned U.S. operating subsidiary of Thalassa Shipping & Logistics Société Anonyme ("TSL"), a Greek société anonyme headquartered at 42 Akti Miaouli, Piraeus 18538, Greece. TSL is the ultimate parent company of the Thalassa group of companies (collectively with TAI and its other direct and indirect subsidiaries, the "Thalassa Group").
2. TAI conducts the U.S.-side operations of the Thalassa Group, including Houston terminal operations, Jones Act-exempt foreign-flag vessel scheduling, and domestic freight brokerage services. As of the date hereof, TAI employs approximately 680 individuals in the United States across its Houston headquarters, terminal facilities, and regional offices.
3. TSL, the Debtor's parent, operates a diversified fleet of fifty (50) oceangoing vessels, consisting of thirty-eight (38) dry-bulk carriers and twelve (12) container vessels, with integrated port-to-door logistics services across the Mediterranean, Black Sea, and transatlantic trade lanes. TSL and its subsidiaries collectively employ approximately 4,200 individuals globally, including shore-based staff in Piraeus, London, Singapore, and Houston, as well as seafaring personnel aboard the fleet.
4. The Debtor files this Motion on the first day of its Chapter 11 case (the "Petition Date"), seeking authority to continue and maintain all existing prepetition Insurance Policies, to pay all prepetition premiums, deductibles, self-insured retentions, and related obligations arising thereunder, and to honor any premium financing arrangements, in order to ensure uninterrupted insurance coverage essential to (a) the preservation of the estate, (b) the protection of the Debtor's assets, including the Debtor's and TSL's interests in the fleet, which was appraised at a total value of approximately $623 million as of November 1, 2022, by Drakos Maritime Valuations Ltd., Captain Nikos Drakos, Managing Director, 28 Poseidonos Avenue, Piraeus 18531, Greece (the "Drakos Appraisal"), (c) compliance with contractual covenants, including those contained in the Senior Secured Credit Agreement (as defined below), (d) compliance with applicable regulatory and statutory requirements, and (e) the protection of the Debtor's directors, officers, and other fiduciaries during the pendency of the Chapter 11 case.
5. A lapse in any of the Debtor's insurance coverage would be catastrophic. The Thalassa Group's operations are capital-intensive, high-risk, and heavily regulated. The fleet, valued at $623 million, is exposed to the full panoply of maritime perils, including weather, collision, grounding, cargo damage, pollution, and personal injury. The Debtor's obligations under the $685 million Senior Secured Credit Facility (as defined and described more fully below) include affirmative covenants requiring the maintenance of specified insurance on the collateral at all times. A lapse in insurance coverage would constitute an independent Event of Default under the Senior Secured Credit Agreement, compounding the defaults that precipitated this filing and potentially jeopardizing any consensual restructuring. Furthermore, the Debtor owes fiduciary duties to its creditors and stakeholders that require the prudent maintenance of insurance coverage, including directors' and officers' liability insurance. For these reasons, the Debtor submits that the relief requested herein is critical and should be granted on the first day of the case.
II. JURISDICTION AND VENUE
6. This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334 and the Standing Order of Reference from the United States District Court for the Southern District of Texas, dated August 28, 2012. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2). The Debtor confirms its consent, pursuant to Rule 9013-1 of the Bankruptcy Local Rules for the Southern District of Texas, to the entry of a final order by the Court in connection with this Motion to the extent it is later determined that the Court, absent consent of the parties, cannot enter final orders or judgments in connection herewith consistent with Article III of the United States Constitution.
7. Venue is proper in this District pursuant to 28 U.S.C. §§ 1408 and 1409. The Debtor's principal office and executive headquarters are located at 1400 McKinney Street, Suite 2200, Houston, Texas 77010, within the Houston Division of the Southern District of Texas. A substantial portion of the Debtor's assets, including its books and records, accounts receivable, and the Houston terminal lease, are located within this District.
8. The statutory predicates for the relief requested herein are Sections 105(a), 363(b), and 365 of the Bankruptcy Code and Bankruptcy Rules 6003 and 6004.
III. BACKGROUND
A. General Background
9. A detailed description of the Debtor's business operations, corporate and organizational structure, capital structure, and the circumstances giving rise to the commencement of this Chapter 11 case is set forth in the Declaration of Marcus Hale, President of Thalassa Americas Inc., in Support of First-Day Motions (the "Hale Declaration"), filed contemporaneously herewith and incorporated herein by reference. The following is a summary of certain facts relevant to this Motion.
10. TSL was founded in 1987 by the Kostandinos family and has grown over the past thirty-five years into a prominent mid-market international shipping and logistics enterprise. Dimitrios Kostandinos serves as Chairman of the Board of Directors of TSL and holds, directly and indirectly through KFO Holdings SA, a Luxembourg-domiciled family holding company, approximately sixty-two percent (62%) of the equity interests in TSL. Elena Kostandinos-Pavlou, sister of Dimitrios Kostandinos, serves as Vice Chairwoman and holds approximately eighteen percent (18%) of the equity interests in TSL through KFO Holdings SA. Together, the Kostandinos family holds a combined eighty percent (80%) of TSL's equity through KFO Holdings SA. The remaining twenty percent (20%) is held by institutional investors and members of senior management pursuant to stock option and equity incentive plans.
11. TAI was incorporated in the State of Delaware and maintains its registered agent at Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801. TAI serves as the Thalassa Group's principal U.S. operating entity and is responsible for, among other things, (a) managing and operating the Houston terminal, which serves as the Thalassa Group's primary North American cargo handling and distribution facility, (b) coordinating the scheduling of foreign-flag vessels calling at U.S. ports (exempt from Jones Act cabotage restrictions), and (c) conducting domestic freight brokerage operations through a network of carrier relationships across the continental United States.
12. The current officers of TAI are Marcus Hale (President), Diana Restrepo (Vice President, Finance), and Jonathan Kurtz (Vice President, Operations). Each of these individuals has played and continues to play a critical role in the day-to-day operations of the Debtor and is essential to the successful administration of the estate during the Chapter 11 case.
13. The Thalassa Group has experienced a severe and sustained downturn in its financial performance and liquidity position over the course of 2022. TSL's consolidated revenue declined from approximately €1.42 billion in fiscal year 2021 to an estimated €987 million in fiscal year 2022, representing a decline of approximately 30.5%. TAI's standalone revenue declined from approximately $312 million in fiscal year 2021 to an estimated $198 million in fiscal year 2022, representing a decline of approximately 36.5%. These revenue declines are directly attributable to the collapse in global dry-bulk charter rates, which saw the Baltic Dry Index (the "BDI") decline by approximately fifty-eight percent (58%) between January 2022 and September 2022. The average daily time charter equivalent ("TCE") rate for the fleet fell from approximately $24,800 per day to approximately $11,200 per day over the same period, severely eroding the fleet's revenue-generating capacity and the Thalassa Group's ability to service its debt obligations.
B. Capital Structure
14. As of September 30, 2022, the Debtor's capital structure consists of the following principal indebtedness:
15. Senior Secured Credit Facility. On June 15, 2019, TSL (as Borrower) and TAI (as Co-Borrower with respect to the U.S. Tranche) entered into that certain Senior Secured Credit Agreement (as amended, restated, supplemented, or otherwise modified from time to time, the "Senior Secured Credit Agreement") with Nordbank International AG, as Administrative Agent and Collateral Agent, and a syndicate of nine (9) lending institutions (collectively, the "Senior Secured Lenders"). The Senior Secured Credit Agreement provides for aggregate commitments of $685 million, structured as follows:
(a) Term Loan A: $400 million, amortizing, of which approximately $270 million was outstanding as of September 30, 2022;
(b) Revolving Credit Facility: $200 million commitment, of which approximately $185 million was drawn as of September 30, 2022;
(c) U.S. Tranche (Term Loan B): $85 million, non-amortizing bullet maturity, with TAI as a direct co-borrower, all $85 million of which remained outstanding as of September 30, 2022; and
(d) Total Outstanding: As of September 30, 2022, the aggregate outstanding principal amount under the Senior Secured Credit Agreement was approximately $540 million.
16. The Senior Secured Credit Agreement bears interest at a rate of SOFR plus 375 basis points, with a default rate of an additional 200 basis points. The obligations under the Senior Secured Credit Agreement are secured by first-priority liens on substantially all of the assets of TSL and its subsidiaries, including (a) the thirty-eight (38) dry-bulk carriers and twelve (12) container vessels comprising the fleet, (b) the Houston terminal lease, (c) all accounts receivable and contract rights, and (d) the equity interests in TAI and fourteen (14) vessel-owning special purpose vehicles.
17. Mezzanine Notes. TSL issued mezzanine notes (the "Mezzanine Notes") to Dralvecen Mezzanine Capital LLC ("BMC") in an original principal amount of $100 million. As of September 30, 2022, the aggregate outstanding balance under the Mezzanine Notes was approximately $112.3 million, consisting of the original $100 million in principal plus approximately $12.3 million in payment-in-kind ("PIK") interest that has been capitalized and added to the principal balance. The Mezzanine Notes bear interest at a rate of 11.5% on a PIK toggle basis and are secured by second-priority liens on the same collateral package as the Senior Secured Credit Agreement, subject to the terms of an Intercreditor Agreement dated June 15, 2019 between Nordbank International AG (as first-lien agent) and BMC (as second-lien holder).
18. Senior Unsecured Notes. TAI issued senior unsecured notes in the aggregate principal amount of $50 million (the "Unsecured Notes"), bearing interest at a rate of 8.25% per annum (cash pay), with a maturity date of March 1, 2025. Garrison Trust Company serves as indenture trustee under the indenture governing the Unsecured Notes (the "Unsecured Notes Indenture"). As of September 30, 2022, the full $50 million principal amount of the Unsecured Notes remained outstanding.
19. Intercompany Note. TAI is the obligor on an intercompany promissory note payable to TSL in the aggregate principal amount of approximately $76.4 million (the "Intercompany Note"). The Intercompany Note is subordinated to all other indebtedness of TAI and is unsecured.
20. Total Debt. As of September 30, 2022, the Debtor and its parent had total consolidated indebtedness of approximately $847.3 million, consisting of (a) $540 million under the Senior Secured Credit Agreement, (b) $112.3 million under the Mezzanine Notes, (c) $50 million under the Unsecured Notes, (d) $76.4 million under the Intercompany Note, and (e) accrued and unpaid interest and fees in amounts to be set forth in the schedules of assets and liabilities to be filed with the Court.
C. Events Precipitating the Filing
21. The following events, among others, precipitated the commencement of this Chapter 11 case:
(a) September 15, 2022 — Minimum Liquidity Covenant Breach. The Debtor's consolidated cash and cash equivalents fell to approximately $27.3 million, in breach of the $40 million minimum liquidity covenant set forth in Section 7.11(c) of the Senior Secured Credit Agreement, resulting in a shortfall of approximately $12.7 million and constituting an Event of Default thereunder.
(b) September 30, 2022 — Financial Covenant Breaches. As of the fiscal quarter ended September 30, 2022, the Debtor's Net Leverage Ratio (as defined in the Senior Secured Credit Agreement) stood at 7.82x, materially exceeding the applicable covenant threshold of 5.50x, and the Debtor's Interest Coverage Ratio (as defined therein) stood at 1.74x, materially below the applicable covenant threshold of 2.50x, each constituting an additional Event of Default under the Senior Secured Credit Agreement.
(c) October 10, 2022 — Forbearance Agreement. TSL, TAI, and the Senior Secured Lender syndicate entered into a Forbearance Agreement (the "Forbearance Agreement") pursuant to which the Senior Secured Lenders agreed to forbear from exercising their remedies under the Senior Secured Credit Agreement for a period of ninety (90) days, commencing October 10, 2022, and expiring January 8, 2023 (as extended by agreement of the parties through January 20, 2023), subject to certain conditions and milestones, including the filing of a voluntary petition under Chapter 11 of the Bankruptcy Code.
(d) December 1, 2022 — Missed Interest Payment on Unsecured Notes. The Debtor failed to make its semi-annual interest payment of $2,062,500 on the Unsecured Notes on the scheduled payment date of December 1, 2022. The thirty (30) day cure period under the Unsecured Notes Indenture expired on January 1, 2023, resulting in an Event of Default under the Unsecured Notes Indenture.
22. In light of the foregoing defaults, the expiration of the Forbearance Agreement, and the Debtor's inability to refinance or otherwise address its liquidity crisis outside of a court-supervised process, the Debtor determined, in consultation with its advisors, that a filing under Chapter 11 of the Bankruptcy Code was in the best interests of the estate, its creditors, and all parties in interest.
IV. THE DEBTOR'S INSURANCE PROGRAM
A. Overview of Insurance Program
23. The Debtor and its parent TSL maintain a comprehensive insurance program (the "Insurance Program") that is critical to (a) the operation of the Debtor's business, (b) the protection of the estate's assets, (c) compliance with regulatory and statutory requirements, (d) satisfaction of contractual covenants under the Senior Secured Credit Agreement and related documents, and (e) the protection of the Debtor's officers, directors, and other fiduciaries. The Insurance Program is described in detail below and summarized in the schedule attached hereto as Exhibit B (the "Insurance Schedule").
24. All insurance policies comprising the Insurance Program are arranged through Seaward & Beckett Insurance Brokers Ltd. ("Seaward & Beckett"), headquartered at 71 Fenchurch Street, London EC3M 4BS, United Kingdom (contact: Ian Beckett, Managing Director). Seaward & Beckett has served as the insurance broker of record for the Thalassa Group since 2008 and possesses specialized expertise in the placement of marine, aviation, and energy insurance programs on behalf of international shipping enterprises. Seaward & Beckett is responsible for the placement, renewal, and administration of the Insurance Policies with various insurers and underwriters, and the Debtor relies on Seaward & Beckett's expertise and market relationships to obtain and maintain adequate coverage on commercially reasonable terms.
25. The Insurance Program covers, among other things, (a) the fleet of fifty (50) vessels, with an aggregate appraised value of $623 million as of November 1, 2022 (per the Drakos Appraisal), (b) the Debtor's shore-based operations, including the Houston terminal and domestic freight brokerage operations, (c) approximately 680 U.S.-based employees, and (d) the officers and directors of the Debtor and its affiliates.
26. Maintenance of the Insurance Program is not merely prudent — it is contractually mandated. The Senior Secured Credit Agreement dated June 15, 2019 contains detailed affirmative covenants (set forth in Article VI thereof) requiring the Borrower and its subsidiaries to maintain insurance on the collateral, including, without limitation, hull and machinery insurance, protection and indemnity insurance, and loss of hire insurance, in each case in amounts and with carriers satisfactory to Nordbank International AG in its capacity as Collateral Agent. A failure to maintain such insurance constitutes an immediate Event of Default under the Senior Secured Credit Agreement, independent of any other default, and would entitle the Senior Secured Lenders to exercise all of their remedies, including acceleration of the outstanding indebtedness.
27. In addition, the Intercreditor Agreement dated June 15, 2019 between Nordbank International AG (as first-lien agent) and BMC (as second-lien holder) requires the maintenance of insurance on the shared collateral package as a condition of the intercreditor arrangements. Nordbank International AG is named as loss payee and additional insured on certain of the Insurance Policies in its capacity as Collateral Agent for the benefit of the Senior Secured Lenders.
B. Description of Insurance Policies
28. The Debtor's Insurance Program consists of the following principal categories of coverage:
1. Directors' and Officers' Liability Insurance ("D&O Policy").
29. The Debtor and TSL maintain a directors' and officers' liability insurance policy (the "D&O Policy") with Promontory Indemnity Insurance Co. (Bermuda) ("Promontory"), bearing Policy Number PII-DO-2022-08847. The D&O Policy provides an aggregate limit of liability of $25,000,000 and covers the liability of directors and officers of TAI and its affiliates (including TSL) for claims arising from wrongful acts committed in their capacity as directors and officers of the insured entities. The D&O Policy includes the following coverage parts:
(a) Side A Coverage (Non-Indemnifiable Loss): Provides direct coverage to individual directors and officers for loss arising from claims made against them for wrongful acts, to the extent that the company is unable or unwilling to indemnify such individuals (including situations where the company is legally prohibited from providing indemnification, such as in insolvency proceedings);
(b) Side B Coverage (Corporate Reimbursement): Reimburses the company for indemnification payments made to directors and officers in connection with covered claims; and
(c) Side C Coverage (Entity Coverage for Securities Claims): Provides coverage to the corporate entity itself for claims alleging violations of securities laws.
30. The named insureds under the D&O Policy are TAI and TSL. The insured persons include, without limitation, the following current and former directors and officers: Dimitrios Kostandinos (Chairman, TSL), Elena Kostandinos-Pavlou (Vice Chairwoman, TSL), Georgios Andreadis (Chief Executive Officer, TSL), Irini Dalakoura (Chief Financial Officer, TSL), Stavros Papageorgiou (General Counsel, TSL, Piraeus), Marcus Hale (President, TAI), Diana Restrepo (Vice President, Finance, TAI), Jonathan Kurtz (Vice President, Operations, TAI), and all other past and present directors and officers of TAI, TSL, and their respective subsidiaries and affiliates.
31. Maintaining the D&O Policy is of paramount importance to the Debtor and the estate. The D&O Policy provides the primary source of recovery for any claims that may be asserted against the Debtor's fiduciaries arising from conduct in the period leading up to, during, and following the Chapter 11 filing — a period commonly referred to as the "zone of insolvency." Without the protection afforded by the D&O Policy, current directors and officers may refuse to continue serving in their capacities, which would severely impair the Debtor's ability to administer the estate, operate its business, and pursue a successful reorganization. In addition, upon any change of control or confirmation of a plan of reorganization, the Debtor may need to obtain "tail" coverage under the D&O Policy to protect directors and officers from claims arising from pre-closing or pre-confirmation conduct.
2. Hull and Machinery Insurance ("H&M").
32. The Debtor and TSL maintain hull and machinery insurance (the "H&M Policy") covering physical damage to, and total or constructive total loss of, the fleet of fifty (50) vessels comprising thirty-eight (38) dry-bulk carriers and twelve (12) container vessels. The insured values under the H&M Policy reflect the November 1, 2022 Drakos Appraisal and are broken down by vessel class as follows:
33. Maintenance of the H&M Policy is expressly required under Article VI of the Senior Secured Credit Agreement. The thirty-eight dry-bulk carriers and twelve container vessels constitute a substantial portion of the collateral securing the $540 million in outstanding obligations under the Senior Secured Credit Agreement, and any lapse in H&M coverage would constitute an immediate Event of Default thereunder, wholly apart from the existing defaults described above. Nordbank International AG is named as loss payee under the H&M Policy in its capacity as Collateral Agent for the benefit of the Senior Secured Lender syndicate.
34. The H&M Policy is customarily placed on the London and international marine insurance markets through Seaward & Beckett, with coverage written by one or more leading marine insurance underwriters on terms consistent with the Institute Time Clauses — Hulls (ITC Hulls) or comparable international hull clauses. Given the aggregate insured value of $623 million, the H&M Policy represents one of the most significant and expensive components of the Insurance Program.
3. Protection & Indemnity Insurance ("P&I").
35. The Debtor and TSL maintain protection and indemnity insurance (the "P&I Coverage") providing third-party liability coverage for the fleet. P&I Coverage is the maritime industry's equivalent of comprehensive general liability insurance and encompasses, without limitation, coverage for:
(a) Bodily injury to and illness or death of crew members, passengers, stevedores, and other third parties;
(b) Loss of or damage to cargo;
(c) Pollution liability, including liability for oil spills and other hazardous substance releases;
(d) Wreck removal costs and expenses;
(e) Collision liability (to the extent not covered under the H&M Policy, commonly referred to as the "one-fourth collision liability" or excess collision liability);
(f) Fines, penalties, and other regulatory liabilities imposed on the vessel or her owners; and
(g) Other maritime liabilities arising from the operation of the fleet.
36. P&I Coverage is essential for the operation of any commercial vessel. Without P&I Coverage, the Debtor's and TSL's vessels would be unable to legally call at ports in most jurisdictions worldwide, as port-state authorities in virtually all major trading nations require vessels to carry valid P&I certification as a condition of entry. Furthermore, P&I Coverage is required under numerous international conventions, including the International Convention on Civil Liability for Oil Pollution Damage (CLC), the International Convention on Civil Liability for Bunker Oil Pollution Damage (Bunker Convention), and the Maritime Labour Convention, 2006 (MLC 2006). P&I Coverage is typically placed through one or more protection and indemnity clubs ("P&I Clubs"), which are mutual insurance associations, with placement arranged by Seaward & Beckett Insurance Brokers Ltd. on behalf of the Thalassa Group.
4. Loss of Hire Insurance.
37. The Debtor and TSL maintain loss of hire insurance (the "Loss of Hire Policy") covering loss of income when a vessel is unable to trade due to an insured peril, such as hull damage, machinery breakdown, or other casualties covered under the H&M Policy. Loss of hire insurance is analogous to business interruption insurance in the shore-based context and provides the Debtor with a critical financial backstop during periods when vessels are off-hire for repairs or other insured events.
38. Given the severe revenue pressures facing the Thalassa Group and the critical importance of maximizing fleet utilization during the Chapter 11 case, the Loss of Hire Policy is essential to the Debtor's cash flow and to the preservation of estate value. Maintenance of loss of hire insurance is also expressly required under the Senior Secured Credit Agreement.
5. General Liability Insurance.
39. The Debtor maintains commercial general liability insurance (the "General Liability Policy") covering the Debtor's shore-based operations, including the Houston terminal at 1400 McKinney Street and the Debtor's domestic freight brokerage operations conducted throughout the United States. The General Liability Policy covers third-party bodily injury claims, property damage claims, personal and advertising injury claims, and products-completed operations claims arising from the Debtor's U.S. operations. Maintenance of the General Liability Policy is essential to protect the estate from direct exposure to tort claims arising from the Debtor's significant shore-based operations, including the Houston terminal, which involves the handling, storage, and distribution of large volumes of cargo.
6. Workers' Compensation and Employer's Liability Insurance.
40. The Debtor maintains workers' compensation and employer's liability insurance (the "Workers' Compensation Policy") covering the Debtor's approximately 680 U.S.-based employees. The Workers' Compensation Policy provides statutory workers' compensation benefits as required by the laws of the State of Texas and the laws of each other state in which the Debtor operates or has employees, as well as employer's liability coverage for claims not subject to the exclusive remedy provisions of the applicable workers' compensation statute.
41. Maintenance of workers' compensation insurance is mandatory under Texas law and under the workers' compensation statutes of other states in which the Debtor operates. A lapse in workers' compensation coverage would expose the estate to direct, unlimited liability for workplace injuries, occupational illnesses, and related claims, and would subject the Debtor to significant regulatory penalties, including potential criminal sanctions in certain jurisdictions. The Debtor's failure to maintain workers' compensation coverage could also result in work stoppages and the loss of essential personnel.
7. Property Insurance.
42. The Debtor maintains property insurance (the "Property Policy") covering the Debtor's shore-based physical assets, including the Houston terminal facility, equipment, inventory, leasehold improvements, and other tangible property. The Houston terminal lease is a component of the collateral package securing the Senior Secured Credit Agreement, and accordingly, the Property Policy names Nordbank International AG as loss payee and additional insured with respect to the Debtor's interest in the Houston terminal facility and related assets.
8. Cargo / Freight Liability Insurance.
43. The Debtor maintains cargo and freight liability insurance (the "Cargo Policy") covering loss of or damage to cargo in the Debtor's care, custody, or control in connection with its domestic freight brokerage operations. As a freight broker, the Debtor regularly takes responsibility for the arrangement of transportation services for shipper customers and may be held liable for cargo loss or damage under applicable law and the Debtor's standard terms and conditions of carriage. The Cargo Policy is critical to maintaining the Debtor's relationships with its shipper customers, which constitute a significant revenue source, and to satisfying the Debtor's contractual obligations under its various freight brokerage agreements.
9. Excess / Umbrella Liability Insurance.
44. The Debtor maintains excess and umbrella liability insurance (the "Excess Policy") providing additional liability coverage above the limits of the primary General Liability Policy, the employer's liability portion of the Workers' Compensation Policy, and certain other underlying policies. Given the scale and risk profile of the Debtor's maritime and logistics operations — which involve heavy industrial activities at the Houston terminal, the coordination of international vessel traffic, and the handling of substantial quantities of cargo — the primary policy limits standing alone may be insufficient to fully protect the estate from catastrophic liability events. The Excess Policy provides an additional layer of protection that is necessary and appropriate given the Debtor's operational risk profile.
C. Premium Obligations
45. The Debtor's Insurance Program requires the payment of substantial annual premiums to the various insurers and underwriters providing coverage. The estimated annual aggregate premiums across all Insurance Policies will be set forth in detail in Exhibit B upon confirmation of final premium schedules from Seaward & Beckett Insurance Brokers Ltd. At this time, the Debtor estimates that the aggregate annual premiums for all Insurance Policies are significant and commensurate with the scope and value of the coverage provided, taking into account the insured value of the fleet ($623 million), the approximately 680 U.S.-based employees, and the breadth of the Debtor's operations.
46. Certain of the Insurance Policies may have prepetition premium arrearages — that is, premiums that were due and payable prior to the Petition Date but remain unpaid. To the extent any such arrearages exist, the Debtor seeks authority to pay all such arrearages in full to prevent the cancellation, lapse, or non-renewal of the applicable Insurance Policies. The insurers and underwriters providing coverage under the Insurance Policies are generally entitled, under the terms of the respective policies and applicable law, to cancel coverage for non-payment of premiums following a relatively short notice period (typically fifteen to thirty days). Accordingly, any failure to pay prepetition premium arrearages promptly could result in the cancellation of essential coverage.
47. In addition to premiums, the Debtor may be required to pay deductibles, self-insured retentions, and administrative charges in connection with claims made under the Insurance Policies. The Debtor seeks authority to pay all such amounts in the ordinary course of business to ensure the efficient administration and processing of insurance claims.
D. Premium Financing Arrangements
48. To the extent the Debtor or its affiliates finance any insurance premiums through a premium financing company, the Debtor seeks authority to continue making installment payments under any such premium financing agreements (collectively, the "Premium Financing Arrangements"). Premium financing is a common practice in the maritime insurance industry, where the large premiums associated with hull and machinery, P&I, and other marine insurance coverages are frequently financed on an installment basis through specialized premium finance companies.
49. Under a typical premium financing arrangement, the premium finance company advances the full premium amount to the insurer on behalf of the insured and the insured repays the advance in monthly or quarterly installments, together with a financing charge. Critically, premium financing agreements almost universally include a provision granting the premium finance company a power of attorney to direct the insurer to cancel the underlying policy in the event the insured defaults on its installment payment obligations. Accordingly, any failure to continue honoring the Debtor's obligations under the Premium Financing Arrangements could result in the cancellation of the financed policies, with the same catastrophic consequences described throughout this Motion.
50. The Debtor therefore requests authority to continue making all installment payments and other payments due under the Premium Financing Arrangements in the ordinary course of business, whether such payments relate to prepetition or postpetition periods, to prevent the exercise of cancellation rights by any premium finance company.
V. RELIEF REQUESTED
51. By this Motion, the Debtor respectfully requests entry of an order, substantially in the form of the Proposed Order attached hereto as Exhibit A, authorizing the Debtor to:
(a) Continue and maintain all prepetition Insurance Policies, surety bonds, and related agreements in their current form and on their current terms, including but not limited to:
(i) The D&O Policy (Promontory Indemnity Insurance Co. (Bermuda), Policy No. PII-DO-2022-08847, $25,000,000 aggregate limit);
(ii) Hull and Machinery insurance;
(iii) Protection and Indemnity insurance;
(iv) Loss of Hire insurance;
(v) General Liability insurance;
(vi) Workers' Compensation and Employer's Liability insurance;
(vii) Property insurance;
(viii) Cargo / Freight Liability insurance;
(ix) Excess / Umbrella Liability insurance; and
(x) All other Insurance Policies maintained by the Debtor as of the Petition Date;
(b) Pay all prepetition premium obligations, deductibles, self-insured retentions, and related administrative charges arising under or in connection with the Insurance Policies, including any prepetition arrearages;
(c) Continue to honor and perform under any Premium Financing Arrangements and to pay all prepetition and postpetition installments due thereunder;
(d) Renew, supplement, modify, or purchase additional insurance coverage in the ordinary course of business as the Debtor deems necessary and appropriate to maintain adequate protection for the estate's assets and operations; and
(e) Name Nordbank International AG (in its capacity as Collateral Agent) and any other contractually required parties as additional insureds, loss payees, or mortgagees on the Insurance Policies as required under the Senior Secured Credit Agreement and ancillary documents.
VI. BASIS FOR RELIEF
A. Sections 363(b) and 105(a) of the Bankruptcy Code
52. The Bankruptcy Code provides ample authority for the relief requested herein. Under Section 363(b)(1) of the Bankruptcy Code, the Court may authorize the debtor in possession, after notice and a hearing, to "use, sell, or lease, other than in the ordinary course of business, property of the estate." 11 U.S.C. § 363(b)(1). To the extent that the payment of prepetition insurance premiums, deductibles, and related obligations may be characterized as a use of property of the estate outside the ordinary course of business, the Debtor respectfully requests authority to make such payments under Section 363(b).
53. In addition, Section 105(a) of the Bankruptcy Code authorizes the Court to "issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title," including orders necessary to preserve the estate and protect creditors. 11 U.S.C. § 105(a). The Court's equitable powers under Section 105(a) are broad and may be exercised to authorize the payment of prepetition obligations where, as here, such payment is essential to the preservation of the estate and the protection of all stakeholders.
54. In evaluating a request to authorize transactions under Section 363(b), courts apply the "business judgment" standard, inquiring whether the proposed action represents a sound exercise of the debtor's business judgment. See In re Continental Air Lines, Inc., 780 F.2d 1223, 1226 (5th Cir. 1986); see also In re Mirant Corp., 296 B.R. 427, 429 (Bankr. N.D. Tex. 2003). Under this standard, a debtor's decision to pay prepetition obligations will be approved where the debtor can demonstrate that the payment will serve the best interests of the estate and its creditors.
55. Here, the maintenance of the Insurance Program is a quintessential exercise of sound business judgment. The costs of maintaining the Insurance Program — while substantial — are dwarfed by the catastrophic consequences that would ensue from a lapse in coverage, including:
(a) Destruction of estate value. The fleet, valued at $623 million, would be exposed to uninsured loss or damage from maritime perils, including weather, collision, grounding, fire, machinery breakdown, and other casualties. A single uninsured total loss of a Capesize dry-bulk carrier could cost the estate upwards of $20 million or more;
(b) Personal liability exposure. Officers and directors of the Debtor and TSL would be without the protection of the D&O Policy, potentially exposing the estate to substantial indemnification obligations and deterring current fiduciaries from continuing to serve during the Chapter 11 case;
(c) Regulatory violations. The Debtor would be in violation of mandatory workers' compensation statutes and other regulatory requirements, exposing the estate to penalties, fines, and potential criminal liability;
(d) Contractual defaults. Failure to maintain insurance would constitute an Event of Default under the Senior Secured Credit Agreement (independent of the existing defaults), potentially foreclosing any possibility of a consensual restructuring with the Senior Secured Lenders; and
(e) Operational shutdown. Without P&I coverage, the Debtor's and TSL's vessels would be unable to call at ports in most jurisdictions, effectively shutting down the fleet's commercial operations and destroying the going-concern value of the enterprise.
56. Courts in the Southern District of Texas and in other jurisdictions routinely authorize debtors to maintain their insurance programs on the first day of a Chapter 11 case, recognizing that the preservation of insurance coverage is essential to the administration of the estate and the protection of all parties in interest. See, e.g., In re Sanchez Energy Corp., Case No. 19-34508 (MI) (Bankr. S.D. Tex. Aug. 11, 2019); In re McDermott International, Inc., Case No. 20-30336 (DRJ) (Bankr. S.D. Tex. Jan. 21, 2020); In re Seadrill Limited, Case No. 17-60079 (DRJ) (Bankr. S.D. Tex. Sept. 12, 2017).
B. Compliance with Contractual Obligations
57. As described above, the Senior Secured Credit Agreement dated June 15, 2019 requires the Borrower and its subsidiaries to maintain insurance on the collateral as a continuing affirmative covenant. The specific insurance requirements are detailed in Article VI of the Senior Secured Credit Agreement and in the related collateral documents, and include obligations to maintain hull and machinery insurance, protection and indemnity insurance, loss of hire insurance, and other specified coverages in amounts and with carriers satisfactory to Nordbank International AG as Collateral Agent. Failure to maintain the required insurance would constitute an Event of Default under Section 8.01 of the Senior Secured Credit Agreement, wholly independent of the existing defaults that precipitated this filing, and could jeopardize the Debtor's negotiating position with the Senior Secured Lenders and undermine any prospects for a consensual restructuring.
58. In addition, the Debtor anticipates that the proposed debtor-in-possession financing facility — a proposed $75 million superpriority facility from Nordbank International AG and Triton Credit Partners LP (the "DIP Credit Facility"), bearing interest at SOFR plus 600 basis points, with a 0.50% commitment fee and a twelve-month maturity — will contain affirmative covenants requiring the Debtor to maintain all existing insurance coverages throughout the term of the DIP Credit Facility. The proposed DIP Credit Facility is the subject of a separate first-day motion filed contemporaneously herewith. Maintaining the Insurance Program is therefore essential not only to compliance with the Debtor's existing contractual obligations but also to securing the postpetition financing necessary to fund the Chapter 11 case and preserve the going-concern value of the enterprise.
59. The Intercreditor Agreement dated June 15, 2019 between Nordbank International AG (as first-lien agent) and BMC (as second-lien holder) further requires that the shared collateral be maintained in an insured condition. A lapse in insurance coverage could trigger cross-default provisions and complicate the already delicate intercreditor dynamics that the Debtor and its advisors must navigate during the restructuring process.
C. Regulatory and Statutory Requirements
60. Quite apart from contractual obligations, the maintenance of certain of the Insurance Policies is mandated by applicable law and regulation. Workers' compensation insurance is mandatory under Texas law and under the laws of other states in which the Debtor operates. See Tex. Lab. Code Ann. § 406.002 et seq. A lapse in workers' compensation coverage would expose the estate to direct liability for workplace injuries, regulatory penalties, and potential criminal sanctions. Moreover, certain governmental contracts, permits, and licenses held by the Debtor may require the maintenance of specified insurance coverages as a condition of continued validity.
61. In the maritime context, protection and indemnity insurance and hull and machinery insurance are effectively mandatory for the operation of commercial vessels under international conventions and the port-state control requirements of virtually every major trading nation. The Debtor's vessels cannot legally call at ports, load or discharge cargo, or transit international waters without valid P&I certification and adequate hull coverage. Accordingly, any lapse in maritime insurance coverage would effectively ground the fleet and eliminate the Debtor's (and TSL's) ability to generate revenue — the very revenue that is essential to funding the Chapter 11 case and any plan of reorganization.
62. Simply stated, the Debtor cannot operate its business, preserve the going-concern value of the estate, or fulfill its obligations to creditors and stakeholders without maintaining the full breadth of its Insurance Program.
D. Protection of Officers, Directors, and Fiduciaries
63. The D&O Policy with Promontory Indemnity Insurance Co. (Policy No. PII-DO-2022-08847, $25,000,000 aggregate limit) provides essential and irreplaceable protection for the Debtor's and TSL's directors and officers during the pendency of the Chapter 11 case. Directors and officers of companies operating in the zone of insolvency and in Chapter 11 face heightened scrutiny and an increased risk of claims alleging breaches of fiduciary duty, preferential or fraudulent transfers, securities violations, and other wrongful acts. The D&O Policy provides the primary — and in many cases the only — source of recovery for such claims.
64. Maintaining the D&O Policy is essential to retaining the services of the current management team, including Marcus Hale (President, TAI), Diana Restrepo (Vice President, Finance, TAI), and Jonathan Kurtz (Vice President, Operations, TAI) at the Debtor level, and Dimitrios Kostandinos (Chairman, TSL), Elena Kostandinos-Pavlou (Vice Chairwoman, TSL), Georgios Andreadis (Chief Executive Officer, TSL), and Irini Dalakoura (Chief Financial Officer, TSL) at the parent level. Each of these individuals possesses institutional knowledge, industry expertise, and relationships that are critical to the Debtor's ability to operate its business, negotiate with creditors, and pursue a successful reorganization. Without the protection of the D&O Policy, one or more of these individuals may determine that the personal risk of continued service is unacceptable and resign, which would be profoundly detrimental to the estate, creditors, and the reorganization process.
65. Furthermore, the Debtor's advisors have identified Richard "Rick" Thornberg of Alderney Management Advisors LLC as a potential Chief Restructuring Officer ("CRO") for the Debtor. The designation of a CRO, if it occurs, will further underscore the need for continuous and adequate D&O coverage for all fiduciaries of the Debtor and its affiliates, including any CRO, during the pendency of the Chapter 11 case.
66. For all of the foregoing reasons, the Debtor submits that the continuation and maintenance of the D&O Policy is essential to the successful administration of the estate and the protection of all parties in interest.
VII. REQUEST FOR IMMEDIATE RELIEF UNDER BANKRUPTCY RULE 6003
67. The Debtor requests that the Court consider this Motion on an emergency basis pursuant to Bankruptcy Rule 6003, which provides that "[e]xcept to the extent that relief is necessary to avoid immediate and irreparable harm, the court shall not, within 21 days after the filing of the petition, issue an order granting . . . a motion to use, sell, lease, or otherwise incur an obligation regarding property of the estate." Fed. R. Bankr. P. 6003(b). Rule 6003 permits the Court to grant first-day relief where the movant demonstrates that such relief is "necessary to avoid immediate and irreparable harm" to the estate.
68. The Debtor submits that any lapse in insurance coverage would cause immediate and irreparable harm to the estate, including, without limitation:
(a) The fleet, with an aggregate appraised value of $623 million, would be exposed to uninsured loss from maritime perils, including collision, grounding, fire, weather damage, and machinery breakdown;
(b) The Debtor would be unable to operate its vessels or conduct terminal operations, as P&I Clubs and port-state authorities would refuse to certify or admit uninsured vessels;
(c) The Senior Secured Lender syndicate, holding $540 million in outstanding claims, would have grounds for additional default claims and potential relief from the automatic stay based on the inadequacy of collateral protection;
(d) The Debtor would violate state workers' compensation laws, exposing the estate to direct liability for workplace injuries and subjecting the Debtor to regulatory penalties and potential criminal sanctions; and
(e) Officers and directors of the Debtor and TSL would be without the protection of the D&O Policy, potentially causing essential personnel to resign and impairing the Debtor's ability to administer the estate and pursue a reorganization.
69. Each of these consequences would be immediate upon a lapse in coverage and would cause harm that is, by its very nature, irreparable — property damage, personal injury, regulatory violations, and the departure of key personnel cannot be "undone" after the fact. Accordingly, the Debtor respectfully submits that cause exists under Bankruptcy Rule 6003 for the entry of an order granting the relief requested herein on the first day of the case.
VIII. WAIVER OF BANKRUPTCY RULE 6004(a) NOTICE AND STAY
70. The Debtor requests a waiver of any applicable notice requirements under Bankruptcy Rule 6004(a) to the extent that such notice has not been provided in connection with this Motion and to the extent that such notice is not required for the limited, non-dispositive relief sought herein. The Debtor has provided notice of this Motion to all parties identified in Section IX below, which the Debtor submits is adequate and appropriate under the circumstances.
71. The Debtor further requests a waiver of the fourteen (14) day stay imposed by Bankruptcy Rule 6004(h), which provides that "[a]n order authorizing the use, sale, or lease of property other than cash collateral is stayed until the expiration of 14 days after entry of the order, unless the court orders otherwise." Fed. R. Bankr. P. 6004(h). As set forth above, any delay in the effectiveness of the relief requested herein could result in a lapse in insurance coverage and the immediate and irreparable consequences described in this Motion. Accordingly, the Debtor respectfully requests that the Proposed Order be effective immediately upon entry, without the fourteen-day stay that would otherwise apply under Rule 6004(h).
IX. NOTICE
72. Notice of this Motion and the Proposed Order has been provided to the following parties or their counsel:
(a) The Office of the United States Trustee for the Southern District of Texas (Region 7), 515 Rusk Street, Suite 3516, Houston, Texas 77002;
(b) Nordbank International AG, in its capacity as Administrative Agent and Collateral Agent under the Senior Secured Credit Agreement, Bahnhofstrasse 78, 8001 Zürich, Switzerland, Attn: Henrik Lüdemann, Managing Director, Restructuring & Special Situations;
(c) Counsel to the Ad Hoc Group of Senior Secured Lenders, Whitfield, Crane & Burgess LLP, 51 West 52nd Street, 38th Floor, New York, New York 10019, Attn: Graham Whitfield III, Esq.;
(d) Dralvecen Mezzanine Capital LLC, 600 Lexington Avenue, 22nd Floor, New York, New York 10022, and its counsel, Kellner & Foss LLP, 1185 Avenue of the Americas, 30th Floor, New York, New York 10036, Attn: Theodore Kellner, Esq.;
(e) Garrison Trust Company, in its capacity as indenture trustee for the Unsecured Notes, 100 Wall Street, 16th Floor, New York, New York 10005, and counsel to the informal group of unsecured noteholders, Ashford, Brightmoor Group & McKay PC, 299 Park Avenue, 18th Floor, New York, New York 10171, Attn: Carolyn Brightmoor Group, Esq.;
(f) The holders of the thirty (30) largest unsecured claims against the Debtor, as identified in the list filed pursuant to Bankruptcy Rule 1007(d);
(g) Seaward & Beckett Insurance Brokers Ltd., 71 Fenchurch Street, London EC3M 4BS, United Kingdom, Attn: Ian Beckett, Managing Director;
(h) Promontory Indemnity Insurance Co. (Bermuda), as carrier under the D&O Policy (Policy No. PII-DO-2022-08847); and
(i) All other parties entitled to notice under Bankruptcy Rule 2002 and the applicable local rules.
73. The Debtor submits that no further notice is required under the circumstances.
X. NO PRIOR REQUEST
74. No previous request for the relief sought herein has been made by the Debtor to this Court or to any other court.
XI. CONCLUSION
WHEREFORE, the Debtor respectfully requests that the Court enter an order, substantially in the form of the Proposed Order attached hereto as Exhibit A:
(i) Authorizing the Debtor to continue and maintain all prepetition Insurance Policies, surety bonds, and related agreements in their current form and on their current terms;
(ii) Authorizing the Debtor to pay all prepetition obligations arising under the Insurance Policies, including premiums, deductibles, self-insured retentions, and premium financing installments;
(iii) Authorizing the Debtor to renew, supplement, modify, or purchase additional insurance coverage in the ordinary course of business as necessary to maintain adequate protection for the estate's assets and operations;
(iv) Waiving the requirements of Bankruptcy Rules 6004(a) and 6004(h) to the extent applicable; and
(v) Granting such other and further relief as the Court deems just and proper.
Respectfully submitted,
Dated: January 17, 2023
CALDERWOOD & HARKNESS LLP
By: ________
Nathaniel Bower (SBN __) Colette Whitman (SBN __) Amy Chesterton (SBN __) Nathan Ikeda (SBN __)
780 Third Avenue New York, New York 10017 Telephone: (212) 555-7800 Facsimile: (212) 555-7801
Email: nbower@calderwoodharkness.com
Email: cwhitman@calderwoodharkness.com
Email: achesterton@calderwoodharkness.com
Email: nikeda@calderwoodharkness.com
Proposed Counsel for the Debtor, Thalassa Americas Inc.
EXHIBIT A
PROPOSED ORDER
UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
ORDER AUTHORIZING THE DEBTOR TO (I) CONTINUE AND MAINTAIN ITS PREPETITION INSURANCE POLICIES, SURETY BONDS, AND RELATED AGREEMENTS, (II) PAY ALL PREPETITION OBLIGATIONS ARISING THEREUNDER, AND (III) HONOR ALL PREMIUM FINANCING OBLIGATIONS IN THE ORDINARY COURSE OF BUSINESS
Upon the Motion (the "Motion") of Thalassa Americas Inc., the above-captioned debtor and debtor in possession (the "Debtor"), for entry of an order pursuant to Sections 105(a), 363(b), and 365 of title 11 of the United States Code (the "Bankruptcy Code") and Rules 6003 and 6004 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules") authorizing the Debtor to (i) continue and maintain its prepetition insurance policies, surety bonds, and related agreements, (ii) pay all prepetition obligations arising thereunder, and (iii) honor all premium financing obligations in the ordinary course of business; and the Court having reviewed the Motion and the Declaration of Marcus Hale, President of Thalassa Americas Inc., filed in support thereof; and the Court having jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334; and consideration of the Motion and the relief requested therein being a core proceeding pursuant to 28 U.S.C. § 157(b)(2); and venue being proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409; and due and sufficient notice of the Motion having been given under the circumstances, and it appearing that no other or further notice need be provided; and the Court having determined that the legal and factual bases set forth in the Motion establish just cause for the relief granted herein; and the Court having determined that the relief requested in the Motion is necessary to avoid immediate and irreparable harm to the estate within the meaning of Bankruptcy Rule 6003; and after due deliberation and sufficient cause appearing therefor,
IT IS HEREBY ORDERED THAT:
1. The Motion is GRANTED as set forth herein.
2. The Debtor is authorized, but not directed, to continue and maintain all prepetition insurance policies, surety bonds, and related agreements (collectively, the "Insurance Policies") in their current form and on their current terms, including without limitation the following:
(a) Directors' and Officers' Liability Insurance: Promontory Indemnity Insurance Co. (Bermuda), Policy No. PII-DO-2022-08847, $25,000,000 aggregate limit;
(b) Hull and Machinery Insurance;
(c) Protection and Indemnity Insurance;
(d) Loss of Hire Insurance;
(e) General Liability Insurance;
(f) Workers' Compensation and Employer's Liability Insurance;
(g) Property Insurance;
(h) Cargo / Freight Liability Insurance;
(i) Excess / Umbrella Liability Insurance; and
(j) All other insurance policies maintained by the Debtor as of the Petition Date, as more fully described in the Motion and in Exhibit B attached to the Motion.
3. The Debtor is authorized to pay all prepetition premiums, deductibles, self-insured retentions, and administrative charges arising under or in connection with the Insurance Policies in the ordinary course of business, and all such payments are hereby approved as administrative expenses of the estate to the extent required.
4. The Debtor is authorized to continue performing under any premium financing arrangements and to pay all prepetition and postpetition installments due thereunder in the ordinary course of business.
5. The Debtor is authorized to renew, supplement, modify, or obtain additional insurance coverage in the ordinary course of business as the Debtor deems necessary and appropriate to maintain adequate protection for the estate's assets and operations, without the need for further order of this Court; provided, however, that the Debtor shall provide notice to the United States Trustee and any statutory committee of unsecured creditors (if appointed) of any material changes to the Insurance Policies, including any new policies with annual premiums in excess of $250,000.
6. The Debtor is authorized to name Nordbank International AG, in its capacity as Collateral Agent under the Senior Secured Credit Agreement dated June 15, 2019, and any other contractually required parties, as additional insureds, loss payees, or mortgagees on the Insurance Policies, as required under the Senior Secured Credit Agreement and ancillary documents.