DRAFT — PREPARED ON STANDBY BASIS; NEVER FILED
UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
APPLICATION OF DEBTOR THALASSA AMERICAS INC. FOR ENTRY OF AN ORDER AUTHORIZING THE RETENTION AND EMPLOYMENT OF KENSINGTON VELTRIAN PARTNERS LLC AS FINANCIAL ADVISOR TO THE DEBTOR, NUNC PRO TUNC TO THE PETITION DATE, PURSUANT TO SECTIONS 327(a) AND 328(a) OF THE BANKRUPTCY CODE, BANKRUPTCY RULES 2014 AND 2016, AND LOCAL RULES
Thalassa Americas Inc. ("TAI" or the "Debtor"), the above-captioned debtor and debtor-in-possession, by and through its proposed counsel, Calderwood & Harkness LLP, hereby files this Application (the "Application") for entry of an order, substantially in the form attached hereto as Exhibit B (the "Proposed Order"), authorizing the Debtor to retain and employ Kensington Veltrian Partners LLC ("KHP") as its financial advisor in this Chapter 11 case, nunc pro tunc to the date on which the Debtor commenced this case (the "Petition Date"), pursuant to sections 327(a) and 328(a) of title 11 of the United States Code, 11 U.S.C. §§ 101–1532 (the "Bankruptcy Code"), Rules 2014 and 2016 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), and the Local Rules for the United States Bankruptcy Court for the Southern District of Texas (the "Local Rules"). In support of this Application, the Debtor respectfully represents as follows:
I. PRELIMINARY STATEMENT
1. Thalassa Americas Inc. is a Delaware C-Corporation and the wholly-owned U.S. operating subsidiary of Thalassa Shipping & Logistics Société Anonyme ("TSL"), a Greek société anonyme organized under the laws of the Hellenic Republic and headquartered at 42 Akti Miaouli, Piraeus 18538, Greece. TAI's principal office is located at 1400 McKinney Street, Suite 2200, Houston, Texas 77010. TAI's Employer Identification Number is 84-3291057. TAI's registered agent for service of process in the State of Delaware is Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801.
2. By this Application, the Debtor seeks authority to retain and employ KHP as its financial advisor, nunc pro tunc to the Petition Date, pursuant to sections 327(a) and 328(a) of the Bankruptcy Code. KHP is a nationally recognized financial advisory firm headquartered at 300 Park Avenue, 12th Floor, New York, New York 10022. James Calloway, a Managing Director of KHP, is the primary professional responsible for the engagement and the day-to-day delivery of financial advisory services to the Debtor in connection with this Chapter 11 case.
3. KHP was originally retained prepetition by TSL and TAI in connection with the Debtor's out-of-court restructuring process, which commenced in the fall of 2022 following covenant breaches under the Debtor's senior secured credit facility and a severe downturn in the global dry-bulk shipping market. The Debtor seeks to continue that engagement in the Chapter 11 case, without interruption, given the critical importance of KHP's institutional knowledge of the Debtor's capital structure, business operations, and ongoing creditor negotiations.
4. The relief sought herein is essential to the Debtor's restructuring efforts. The Debtor's capital structure is complex and involves multiple layers of indebtedness, including (a) a $685 million senior secured credit facility (the "Senior Secured Credit Facility") among a nine-member international lending syndicate, (b) $112.3 million in mezzanine notes (the "Mezzanine Notes") held by a single institutional holder, (c) $50 million in unsecured notes (the "Unsecured Notes") outstanding under a public indenture, and (d) approximately $38.7 million in trade payables. In total, the Debtor and its parent face approximately $847.3 million in aggregate debt obligations, exclusive of the intercompany note. Successful navigation of this restructuring requires the continued and uninterrupted services of a sophisticated financial advisor with deep familiarity with the Debtor's affairs, and KHP is uniquely positioned to fulfill that role.
5. As described in further detail below and in the Verified Statement of James Calloway attached hereto as Exhibit A (the "Calloway Declaration"), KHP is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code, does not hold or represent an interest adverse to the Debtor's estate, and is qualified to serve as the Debtor's financial advisor in this Chapter 11 case.
II. BACKGROUND
A. The Debtor and Its Business
6. TAI operates the U.S.-side business of the TSL conglomerate, a diversified international shipping and logistics enterprise. TAI's operations encompass three principal business lines: (a) Houston terminal operations, centered on the Debtor's leased deepwater terminal facility at the Port of Houston; (b) Jones Act–exempt foreign-flag vessel scheduling, whereby TAI coordinates the deployment and chartering of TSL's foreign-flagged vessels for U.S.-involved international trade routes; and (c) domestic freight brokerage, through which TAI arranges inland transportation and last-mile logistics for cargo discharged at the Houston terminal and other U.S. ports.
7. TSL was founded in 1987 by the Kostandinos family, which continues to control the enterprise through KFO Holdings Société Anonyme, a Greek holding company. Dimitrios Kostandinos serves as Chairman of TSL's board of directors and, through KFO Holdings, holds approximately 62% of the equity interests in TSL. Elena Kostandinos-Pavlou serves as Vice Chairwoman of the TSL board and, through KFO Holdings, holds approximately 18% of the equity interests in TSL. The remaining 20% of TSL's equity is publicly traded on the Athens Exchange (ATHEX: THAL).
8. TSL operates a fleet of fifty (50) vessels, consisting of thirty-eight (38) dry-bulk carriers and twelve (12) container vessels. The dry-bulk fleet comprises ten (10) Capesize vessels, fourteen (14) Panamax vessels, and fourteen (14) Supramax vessels. The container fleet comprises twelve (12) Sub-Panamax vessels. TSL maintains terminal facilities at Piraeus, Greece; Thessaloniki, Greece; and Houston, Texas (operated through TAI). Fourteen of the fifty vessels are held through individual vessel-owning special purpose vehicles ("SPVs") organized under the laws of the Republic of the marshall Islands, the equity interests in which are pledged as collateral under the Senior Secured Credit Facility.
9. TAI's officers are Marcus Hale (President), Diana Restrepo (Vice President of Finance), and Jonathan Kurtz (Vice President of Operations). TSL's board of directors includes, in addition to Dimitrios Kostandinos and Elena Kostandinos-Pavlou, Georgios Andreadis (Chief Executive Officer) and Irini Dalakoura (Chief Financial Officer).
10. TSL employs approximately 4,200 people globally, of which approximately 680 are employed in the United States through TAI. TAI's U.S. workforce includes terminal operations personnel, vessel scheduling and chartering staff, freight brokerage professionals, and corporate and administrative employees based at the Houston headquarters.
11. TAI generated revenue of approximately $312 million in the fiscal year ended December 31, 2021 ("FY2021"). However, as a result of the severe downturn in the global dry-bulk shipping market described below, TAI's revenue for the fiscal year ended December 31, 2022 ("FY2022") is estimated at approximately $198 million, representing a decline of approximately 36.5% year-over-year. On a consolidated basis, TSL generated revenue of approximately €1.42 billion in FY2021 and estimated revenue of approximately €987 million in FY2022, representing a decline of approximately 30.5%.
B. The Capital Structure
12. The Debtor's capital structure, including the obligations of TSL and TAI thereunder, is summarized as follows:
1. Senior Secured Credit Facility.
13. Pursuant to a Credit Agreement originally dated June 15, 2019, as subsequently amended (the "Credit Agreement"), TSL, as borrower, and TAI, as co-borrower with respect to the U.S. Tranche (defined below), obtained a $685 million senior secured credit facility (the "Senior Secured Credit Facility") from a nine-member syndicate of international lending institutions (the "Senior Secured Lenders"), with Nordbank International AG ("Nordbank"), Bahnhofstrasse 78, 8001 Zürich, Switzerland, serving as Administrative Agent and Collateral Agent. The Senior Secured Credit Facility comprises the following tranches:
(a) Term Loan A: An amortizing term loan in the original principal amount of $400 million, subject to quarterly amortization payments of $10 million each. As of September 30, 2022, after thirteen (13) quarters of amortization (representing aggregate principal payments of $130 million), the outstanding principal balance of Term Loan A was $270 million.
(b) Revolving Credit Facility: A revolving credit facility with total commitments of $200 million. As of September 30, 2022, $185 million was drawn under the Revolving Credit Facility, with $15 million in undrawn availability (subject to borrowing base limitations that, as of such date, effectively precluded additional draws).
(c) U.S. Tranche (Term Loan B): A non-amortizing term loan in the principal amount of $85 million with a bullet maturity. TAI is a co-borrower under the U.S. Tranche, which was structured to finance TAI's Houston terminal operations and related working capital needs.
14. As of September 30, 2022, the total outstanding principal balance under the Senior Secured Credit Facility was approximately $540 million, comprising $270 million under Term Loan A, $185 million under the Revolving Credit Facility, and $85 million under Term Loan B (the U.S. Tranche).
15. Interest under the Senior Secured Credit Facility accrues at a rate of SOFR plus 375 basis points, subject to a default rate of an additional 200 basis points upon the occurrence and during the continuance of an event of default under the Credit Agreement. The original maturity date of the Senior Secured Credit Facility is June 15, 2024.
16. Obligations under the Senior Secured Credit Facility are secured by first-priority liens on substantially all of the assets of TSL and TAI, including (a) all fifty (50) vessels in the TSL fleet, (b) the Houston terminal lease, (c) all accounts receivable of TSL and TAI, and (d) the equity interests in TAI and in each of the fourteen (14) vessel-owning SPVs.
17. The nine members of the Senior Secured Lender syndicate and their respective commitments under the Credit Agreement are as follows:
2. Mezzanine Notes.
18. TSL issued mezzanine notes (the "Mezzanine Notes") in the original principal amount of $100 million, the entirety of which is held by Dralvecen Mezzanine Capital LLC ("BMC"), 600 Lexington Avenue, 22nd Floor, New York, New York 10022. Interest on the Mezzanine Notes accrues at a rate of 11.5% per annum on a PIK toggle basis; since the second quarter of 2022, all interest has been paid in kind. As of September 30, 2022, the outstanding principal balance of the Mezzanine Notes was approximately $112.3 million, reflecting $12.3 million in capitalized PIK interest. The Mezzanine Notes mature on December 15, 2024, and are secured by a second-priority lien on the collateral securing the Senior Secured Credit Facility, subordinated to the first-priority liens of the Senior Secured Lenders pursuant to an Intercreditor Agreement dated as of June 15, 2019 (the "Intercreditor Agreement"), by and between Nordbank (as first-lien agent) and BMC.
3. Unsecured Notes.
19. TSL issued senior unsecured notes (the "Unsecured Notes") in the aggregate principal amount of $50 million. The Unsecured Notes bear interest at a rate of 8.25% per annum, payable semi-annually in cash. The Unsecured Notes mature on March 1, 2025. Garrison Trust Company ("Garrison Trust"), 100 Wall Street, 16th Floor, New York, New York 10005, serves as indenture trustee under the indenture governing the Unsecured Notes. The Unsecured Notes trade under CUSIP number 87265BAB5.
4. Intercompany Note.
20. TAI owes TSL approximately $76.4 million under a subordinated intercompany promissory note (the "Intercompany Note"), which bears interest at a rate of 5.0% per annum. The Intercompany Note is subordinated to all third-party indebtedness of TAI, including the U.S. Tranche under the Senior Secured Credit Facility.
5. Trade Payables.
21. As of the Petition Date, TAI's trade payables were approximately $38.7 million. The Debtor's largest trade creditor is Olympian Fuel & Supply SA, to which TAI owes approximately $9.2 million for bunker fuel and related marine fuel supplies. Additional significant trade creditors include port service providers, vessel maintenance contractors, insurance counterparties, and freight brokerage settlement obligations.
22. A summary of the Debtor's aggregate debt obligations is set forth below:
Note: Aggregate third-party debt, inclusive of trade payables, totals approximately $741 million; including the subordinated Intercompany Note, total obligations aggregate approximately $817.4 million. On a consolidated enterprise basis, total funded indebtedness (excluding trade payables and the Intercompany Note) is approximately $847.3 million, reflecting consolidated obligations of TSL and TAI.
C. Events Leading to the Chapter 11 Filing
23. The Debtor's financial distress is attributable primarily to a precipitous decline in the global dry-bulk shipping market and a corresponding deterioration in vessel values and charter rates. The Baltic Dry Index ("BDI"), the principal benchmark for dry-bulk shipping rates, declined approximately 58% between January 2022 and September 2022. As a direct consequence of the BDI decline, TSL's average daily time-charter equivalent rate fell from $24,800 per day (FY2021 average) to $11,200 per day (Q3 2022 average), a decline of approximately 54.8%.
24. Concurrently, the appraised value of the TSL fleet declined materially. As of January 2022, the fleet was appraised at approximately $891 million by Drakos Maritime Valuations Ltd. ("Drakos"), an independent maritime appraisal firm. By November 1, 2022, Drakos's updated appraisal valued the fleet at approximately $623 million, reflecting a decline of approximately $268 million, or 30.1%, in less than eleven months. The decline in fleet values eroded collateral coverage under the Senior Secured Credit Facility and placed significant downward pressure on the Debtor's enterprise value.
25. The convergence of declining charter rates, reduced revenues, and falling asset values resulted in a series of covenant breaches and liquidity events, as follows:
(a) September 15, 2022 — Minimum Liquidity Covenant Breach. As of September 15, 2022, TSL's unrestricted cash and cash equivalents stood at approximately $27.3 million, which was below the $40 million minimum liquidity covenant threshold under Section 7.11(a) of the Credit Agreement. The resulting shortfall of $12.7 million constituted an event of default under the Credit Agreement.
(b) September 30, 2022 — Financial Ratio Covenant Breaches. As of September 30, 2022, TSL breached two additional financial covenants under the Credit Agreement:
(i) Net Leverage Ratio. The Net Leverage Ratio, calculated as Net Debt of $770.9 million divided by LTM EBITDA of $98.6 million, was 7.82x, which exceeded the covenant maximum of 5.50x.
(ii) Interest Coverage Ratio. The Interest Coverage Ratio, calculated as LTM EBITDA of $98.6 million divided by LTM Interest Expense of $56.7 million, was 1.74x, which was below the covenant minimum of 2.50x.
(c) October 10, 2022 — Forbearance Agreement. On October 10, 2022, TSL and the Senior Secured Lender syndicate executed a Forbearance Agreement (the "Forbearance Agreement"), pursuant to which the Senior Secured Lenders agreed to a 90-day standstill on the exercise of remedies in respect of the foregoing events of default, with the standstill period extending through January 8, 2023. The Forbearance Agreement imposed certain milestones and reporting requirements on TSL and TAI, including the retention of a financial advisor and the commencement of a formal restructuring process.
(d) December 1, 2022 — Missed Unsecured Note Interest Payment. On December 1, 2022, TSL failed to make a semi-annual interest payment of $2,062,500 on the Unsecured Notes (calculated as $50,000,000 × 8.25% ÷ 2). The indenture governing the Unsecured Notes provided for a 30-day cure period, which expired on January 1, 2023, without the payment having been made. The missed payment constituted an event of default under the Unsecured Notes indenture.
(e) Forbearance Extensions. The Forbearance Agreement was extended twice: first on January 8, 2023, extending the standstill period to March 8, 2023; and again on March 8, 2023, extending the standstill period to April 7, 2023. Throughout the forbearance period, TAI and TSL, with the assistance of KHP, engaged in intensive negotiations with all creditor constituencies.
26. Based on KHP's analysis, the enterprise value of TSL and TAI on a consolidated basis was estimated at between $580 million and $640 million (midpoint: $610 million) as of November 2022. This valuation range implied that the Senior Secured Lenders were likely to be impaired, that the Mezzanine Notes were significantly underwater (with an estimated recovery of approximately 62.3% at the midpoint enterprise value of $610 million), and that the Unsecured Notes faced a recovery in the range of approximately 8% to 14%. These valuations underscored the need for a comprehensive financial restructuring and informed the Debtor's decision to prepare for a potential Chapter 11 filing.
III. KHP'S QUALIFICATIONS AND BACKGROUND
27. KHP is a nationally recognized financial advisory firm with significant experience in restructuring, insolvency, and related advisory matters. KHP maintains its principal office at 300 Park Avenue, 12th Floor, New York, New York 10022, and employs a team of approximately 85 professionals with expertise in restructuring, mergers and acquisitions, capital markets, and litigation support.
28. KHP has substantial experience advising debtors, official committees of unsecured creditors, secured creditor groups, and other parties in interest in complex Chapter 11 cases and out-of-court restructurings across a wide range of industries, including maritime and shipping, energy, transportation, real estate, retail, and telecommunications. KHP's restructuring advisory practice is widely regarded as among the leading practices of its kind in the United States.
29. Of particular relevance to this engagement, KHP has deep expertise in the maritime and shipping industries. KHP professionals have advised on restructurings involving ocean-going vessel fleets, terminal operations, time-charter agreements, vessel mortgage financings, and the unique regulatory and valuation issues that arise in the shipping sector. KHP's familiarity with maritime industry dynamics — including the cyclical nature of charter rates, the role of maritime appraisal methodologies, and the interplay between flag-state regulation and commercial finance — is directly applicable to the challenges facing the Debtor.
30. James Calloway, the Managing Director who leads the KHP engagement team serving the Debtor, has more than twenty years of experience in restructuring advisory. Mr. Calloway has led numerous complex restructurings involving cross-border elements, large secured lending syndicates, and capital-intensive industries. Mr. Calloway's experience includes advisory mandates in cases involving aggregate funded indebtedness in excess of $10 billion and involving creditor constituencies across multiple jurisdictions. Mr. Calloway's qualifications are set forth in greater detail in the Calloway Declaration attached hereto as Exhibit A.
31. KHP has served as financial advisor to debtors, creditors' committees, and other parties in interest in numerous Chapter 11 cases in this Court and in other jurisdictions throughout the United States, including cases in the United States Bankruptcy Courts for the Southern District of New York, the District of Delaware, the Eastern District of Virginia, and the Northern District of Texas. KHP's broad experience with Chapter 11 practice and procedure, combined with its industry-specific expertise, makes it well-suited to serve as the Debtor's financial advisor in this case.
IV. PREPETITION RETENTION AND SERVICES RENDERED
32. KHP was retained prepetition by TSL and TAI to advise on restructuring alternatives, prepare financial analyses, and assist in negotiations with the Debtor's creditor constituencies. The prepetition retention was entered into in the ordinary course of business as part of the Debtor's efforts to pursue an out-of-court restructuring prior to a potential Chapter 11 filing.
33. Prepetition, KHP was engaged pursuant to an engagement letter between KHP, TSL, and TAI (the "Engagement Letter"), the terms of which are described in Section VI below. The decision to retain KHP was made by the management and boards of directors of TSL and TAI following a review of the qualifications and proposed terms of several financial advisory firms. KHP was selected based on its established expertise in maritime restructurings, the depth of its professional team, and the competitiveness of its proposed fee arrangement.
34. Since its prepetition retention, KHP has provided the following advisory services to the Debtor:
(a) Capital Structure Analysis. KHP conducted a comprehensive analysis of the Debtor's capital structure, including the terms, covenants, cross-default provisions, and intercreditor arrangements governing the $685 million Senior Secured Credit Facility, the $112.3 million Mezzanine Notes, and the $50 million Unsecured Notes.
(b) Enterprise Valuation. KHP prepared a preliminary enterprise valuation of TSL and TAI on a consolidated basis, employing a discounted cash flow analysis, comparable company analysis, and comparable transaction analysis. The resulting valuation range of $580 million to $640 million (midpoint: $610 million) was presented to the Debtor's management and board and has served as the foundation for restructuring negotiations with all creditor constituencies.
(c) Recovery Waterfall Analysis. Based on the enterprise valuation, KHP prepared detailed recovery waterfall analyses for each class of creditors. At the midpoint enterprise value of $610 million, KHP estimated that the Mezzanine Notes would recover approximately 62.3% of their $112.3 million outstanding balance and that the Unsecured Notes would recover between approximately 8% and 14% of their $50 million outstanding balance, depending on assumptions regarding administrative costs, professional fees, and the treatment of certain intercompany claims.
(d) 13-Week Cash Flow Forecasting. KHP prepared and updated rolling 13-week cash flow forecasts for TAI, incorporating assumptions regarding charter revenue, terminal income, operating expenses, debt service obligations, and liquidity. These cash flow models were shared with the Senior Secured Lenders as required under the Forbearance Agreement and have been essential to the monitoring of the Debtor's liquidity position.
(e) Creditor Negotiations. KHP participated in negotiations with the Ad Hoc Group of Senior Secured Lenders (the "Ad Hoc Group"), which holds approximately $372 million, or 54.3%, of the $685 million Senior Secured Credit Facility. The Ad Hoc Group comprises Nordbank International AG, Harborstone Bank plc, Triton Credit Partners LP, and Continental Maritime Lending GmbH, and is represented by Whitfield, Crane & Burgess LLP (Graham Whitfield III). KHP also participated in preliminary discussions with BMC and the informal group of unsecured noteholders regarding potential restructuring terms.
35. The prepetition work product developed by KHP — including its enterprise valuation, recovery waterfall analyses, cash flow models, and strategic restructuring analyses — forms the intellectual foundation for the Debtor's restructuring strategy in this Chapter 11 case. KHP's familiarity with the Debtor's business, capital structure, and creditor dynamics is irreplaceable, and any interruption in KHP's engagement would be materially detrimental to the Debtor's estate and its stakeholders.
V. SCOPE OF SERVICES TO BE PROVIDED IN THE CHAPTER 11 CASE
36. In connection with the Debtor's Chapter 11 case, KHP will provide the following financial advisory services:
(a) Financial Analysis and Reporting. KHP will prepare and update rolling 13-week cash flow forecasts for TAI and, as appropriate, for TSL on a consolidated basis. KHP will analyze monthly operating reports filed by the Debtor with the Court and the Office of the United States Trustee (the "U.S. Trustee"). KHP will monitor the Debtor's compliance with the budget established in connection with any debtor-in-possession financing facility, prepare variance reports comparing actual results to budgeted amounts, and advise the Debtor and its counsel with respect to any material variances or emerging liquidity concerns.
(b) Valuation Services. KHP will prepare updated enterprise valuations of TSL and TAI as needed during the Chapter 11 case, including for purposes of plan formulation, disclosure statement preparation, and confirmation proceedings. KHP will coordinate with Drakos Maritime Valuations Ltd. to obtain updated fleet-level and asset-level vessel appraisals and will integrate such appraisals into its overall valuation framework. KHP will also prepare a liquidation analysis comparing the estimated recoveries to creditors under a hypothetical Chapter 7 liquidation to the estimated recoveries under the Debtor's proposed plan of reorganization, as required by section 1129(a)(7) of the Bankruptcy Code (the "best interests" test).
(c) Plan Development. KHP will assist the Debtor and its counsel in the development of a Chapter 11 plan of reorganization (the "Plan"), including the preparation of pro forma financial projections, feasibility analysis (as required by section 1129(a)(11) of the Bankruptcy Code), and recovery waterfall analyses for each class of creditors under the Plan. KHP will advise on the structuring of plan consideration, including any combination of new debt, equity, cash, or other instruments to be distributed to creditors, and will assist in the negotiation of plan terms with all creditor constituencies.
(d) DIP Financing Support. KHP will analyze the terms of the proposed $75 million superpriority debtor-in-possession credit facility (the "DIP Facility") to be provided by Nordbank International AG and Triton Credit Partners LP. The DIP Facility, as currently proposed, bears interest at SOFR plus 600 basis points, carries a commitment fee of 0.50%, and has a maturity of twelve (12) months from the Petition Date. KHP will prepare and monitor the DIP budget, assist in negotiating the terms of the DIP Facility (including milestones, covenants, adequate protection provisions, and roll-up mechanics, if any), and analyze the DIP Facility's impact on estate liquidity and creditor recoveries.
(e) Creditor Negotiations. KHP will continue its engagement with all creditor constituencies, including:
(i) The Ad Hoc Group of Senior Secured Lenders (holding approximately $372 million, or 54.3%, of the Senior Secured Credit Facility), represented by counsel Whitfield, Crane & Burgess LLP (51 West 52nd Street, 38th Floor, New York, New York 10019, Attn: Graham Whitfield III), and by financial advisor Draycott Advisory Group LLC (520 Madison Avenue, 20th Floor, New York, New York 10022, Attn: Vanessa Chow);
(ii) Dralvecen Mezzanine Capital LLC (holder of $112.3 million in Mezzanine Notes), represented by counsel Kellner & Foss LLP (1185 Avenue of the Americas, 30th Floor, New York, New York 10036, Attn: Theodore Kellner);
(iii) The informal group of unsecured noteholders (the "Unsecured Noteholder Group"), represented by counsel Ashford, Brightmoor Group & McKay PC (299 Park Avenue, 18th Floor, New York, New York 10171, Attn: Carolyn Brightmoor Group);
(iv) Garrison Trust Company (as indenture trustee for the Unsecured Notes); and
(v) Any official committee of unsecured creditors appointed in this case and its professionals, and any other creditor constituencies that may emerge during the Chapter 11 case.
(f) Asset Sale Analysis. KHP will evaluate potential vessel dispositions and other asset sales, including the planned sale of six (6) older dry-bulk carriers currently identified for potential disposition. The estimated aggregate proceeds from such sales, based on preliminary indications of interest and current market conditions, are approximately $72 million. KHP will analyze sale process alternatives (including section 363 sales, private negotiated sales, and auction processes), prepare marketing materials, coordinate with potential purchasers and ship brokers, and advise the Debtor on the timing and structure of any asset sales.
(g) Administrative Cost Monitoring. KHP will track and monitor estimated administrative costs of the Chapter 11 case, currently estimated at approximately $18.5 million for the first twelve (12) months of the case. Administrative costs include professional fees (legal, financial advisory, accounting, claims administration), U.S. Trustee quarterly fees, and other case-related expenses. KHP will coordinate with the Debtor's other retained professionals to monitor the aggregate administrative burden on the estate and will advise the Debtor on strategies to manage and, where possible, reduce such costs.
(h) Cross-Border Coordination. KHP will provide financial advisory support for cross-border issues arising in connection with the restructuring of TSL and TAI, in coordination with Calderwood & Harkness LLP (the Debtor's proposed U.S. counsel) and Vassiliou & Demetriou Law Offices (TSL's Greek counsel based in Athens, Greece). Such cross-border advisory services may include support for any potential Chapter 15 recognition proceeding, analysis of the interplay between U.S. and Greek insolvency and corporate law, and coordination of financial analyses across the TSL group.
(i) Testimony and Expert Services. KHP will provide testimony, expert reports, and related services as may be needed in connection with contested matters and adversary proceedings in this Chapter 11 case, including, without limitation, DIP financing hearings, relief from stay proceedings, plan confirmation, and any valuation disputes. Mr. Calloway and other KHP professionals may be called upon to testify as fact witnesses or as expert witnesses, as appropriate.
(j) Other Advisory Services. KHP will provide such other financial advisory services as may be requested by the Debtor or its counsel and agreed to by KHP, consistent with KHP's role as the Debtor's financial advisor and in accordance with the terms of the Engagement Letter.
VI. TERMS OF RETENTION — COMPENSATION
A. Fee Structure
37. The Debtor proposes that KHP be compensated for its services in accordance with the terms of the Engagement Letter, which provides for the following fee arrangement:
(a) Monthly Advisory Fee. KHP shall receive a monthly advisory fee of $250,000, payable in arrears on the first business day of each succeeding month. The monthly advisory fee compensates KHP for the ongoing commitment of professional resources to the engagement, including the services of Mr. Calloway and his team.
(b) Completion Fee. Upon the occurrence of a "Completion Event," KHP shall be entitled to a completion fee as follows:
(i) Upon the effective date of a confirmed Chapter 11 plan of reorganization, the consummation of a sale of substantially all of the Debtor's assets (whether pursuant to section 363 of the Bankruptcy Code or otherwise), or the execution of an out-of-court restructuring support agreement approved by the requisite creditor constituencies, KHP shall be entitled to a completion fee of $4,500,000; or
(ii) Upon the filing of a Chapter 11 petition (if no alternative transaction described in clause (i) above has been consummated as of the filing date), KHP shall be entitled to a filing fee of $2,000,000.
The completion fee described in clause (i) above shall be creditable against fifty percent (50%) of the aggregate monthly advisory fees previously paid to KHP during the engagement. By way of illustration, if KHP has received twelve months of monthly advisory fees totaling $3,000,000 at the time a Completion Event occurs, the completion fee of $4,500,000 would be reduced by $1,500,000 (50% of $3,000,000), resulting in a net completion fee payable of $3,000,000.
(c) Expense Reimbursement. KHP shall be reimbursed for all reasonable and documented out-of-pocket expenses incurred in connection with the engagement, including but not limited to travel (including airfare, ground transportation, and lodging), data room costs, printing and reproduction, messenger and delivery services, database and research subscriptions, and any third-party professional services engaged by KHP with the Debtor's prior approval. KHP will maintain contemporaneous records of all expenses and will provide such records to the Debtor and the Court in connection with interim and final fee applications.
38. The Debtor submits that the proposed compensation arrangement is consistent with, and typical of, fee arrangements for financial advisors of similar caliber and standing in complex Chapter 11 cases of comparable size and complexity. The monthly advisory fee of $250,000 reflects the scope of services to be provided, the complexity of the Debtor's capital structure (involving approximately $847.3 million in aggregate debt obligations across multiple tranches and creditor constituencies), and the demands of a cross-border restructuring involving a 50-vessel shipping conglomerate. The completion fee structure, which aligns KHP's incentives with the achievement of a successful restructuring outcome, is of the type routinely approved by bankruptcy courts under section 328(a) of the Bankruptcy Code.
39. The monthly advisory fees and the completion fee will be subject to the approval procedures established by the Court and the applicable guidelines of the Office of the United States Trustee for the Southern District of Texas. KHP will file interim and final fee applications in accordance with sections 330 and 331 of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, and any applicable orders of this Court, including any order establishing procedures for interim compensation and reimbursement of expenses.
B. Prepetition Fees and Retainer
40. In accordance with the disclosure obligations of Bankruptcy Rule 2016, the Debtor discloses that KHP received certain fees in connection with prepetition services rendered to TSL and TAI. The specific amounts of all prepetition fees paid to KHP will be disclosed with particularity in the final version of this Application and in the Calloway Declaration upon filing.
41. No retainer was required by KHP in connection with its engagement. KHP's compensation has been and will continue to be limited to the monthly advisory fee, the applicable completion or filing fee, and reimbursement of reasonable out-of-pocket expenses, as described above.
VII. KHP'S CONNECTIONS AND DISINTERESTEDNESS — RULE 2014 VERIFIED STATEMENT
A. Introduction to Disclosure
42. Pursuant to Bankruptcy Rule 2014(a), the Debtor is required to disclose, in connection with any application for retention of a professional person, all of the professional's connections with the debtor, creditors, any other party in interest, their respective attorneys and accountants, the United States Trustee, and any person employed in the office of the United States Trustee. In satisfaction of this requirement, the Verified Statement of James Calloway, Managing Director of KHP, is attached hereto as Exhibit A and incorporated herein by reference.
B. Disclosure of Connections
43. Based on information currently available to KHP and the Debtor, KHP has no connection to the Debtor, its creditors, any other party in interest, their attorneys and accountants, the United States Trustee, or any person employed in the office of the United States Trustee, other than as disclosed herein and in the Calloway Declaration.
44. In particular, KHP discloses the following:
(a) KHP has represented certain of the lender institutions in the Senior Secured Lender syndicate in matters wholly unrelated to the Debtor, TSL, or the transactions and obligations at issue in this Chapter 11 case. Those prior representations are fully identified and described in the Calloway Declaration. KHP has concluded, and the Debtor concurs, that such prior unrelated representations do not create any actual or potential conflict of interest and do not compromise KHP's ability to serve as a disinterested financial advisor to the Debtor in this Chapter 11 case.
(b) KHP has not provided any services to Nordbank International AG, Dralvecen Mezzanine Capital LLC, Whitfield, Crane & Burgess LLP, Kellner & Foss LLP, Ashford, Brightmoor Group & McKay PC, or Draycott Advisory Group LLC in connection with this matter or any matter related to the Debtor, TSL, or the obligations described herein.
(c) KHP does not hold any claim against, or any equity or other interest in, the Debtor, TSL, or any of their affiliates, subsidiaries, or related entities.
(d) KHP has performed a thorough conflicts check of its current and recent engagements and has identified no connections that would disqualify it from serving as a disinterested person under the Bankruptcy Code.
45. To the best of the Debtor's knowledge, information, and belief, formed after reasonable inquiry, KHP is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code and does not hold or represent an interest adverse to the estate of the Debtor. KHP is eligible for retention under section 327(a) of the Bankruptcy Code.
VIII. LEGAL BASIS FOR RETENTION
A. Section 327(a) Requirements
46. Section 327(a) of the Bankruptcy Code provides, in relevant part:
Except as otherwise provided in this section, the trustee, with the court's approval, may employ one or more attorneys, accountants, appraisers, auctioneers, or other professional persons, that do not hold or represent an interest adverse to the estate, and that are disinterested persons, to represent or assist the trustee in carrying out the trustee's duties under this title.
47. Section 327(a) applies to the Debtor as debtor-in-possession pursuant to section 1107(a) of the Bankruptcy Code, which provides that the debtor-in-possession has, with certain exceptions not applicable here, the rights and powers of a trustee under the Bankruptcy Code, including the right to employ professionals under section 327.
48. KHP satisfies both requirements for retention under section 327(a). First, KHP does not hold or represent any interest adverse to the estate of TAI. KHP has no creditor claims against the Debtor, holds no equity interests in the Debtor or its affiliates, and has no financial interest in the outcome of this case other than its entitlement to compensation for professional services rendered. Second, KHP is a "disinterested person" within the meaning of section 101(14) of the Bankruptcy Code. KHP is not a creditor, an equity security holder, or an insider of the Debtor. KHP has not been, within the two years preceding the commencement of this case, a director, officer, or employee of the Debtor. KHP has not been an investment banker for any outstanding security of the Debtor within the meaning of section 101(14)(B) of the Bankruptcy Code.
B. Section 328(a) — Approval of Compensation Terms
49. Section 328(a) of the Bankruptcy Code provides, in relevant part:
The trustee, or a committee appointed under section 1102 of this title, with the court's approval, may employ or authorize the employment of a professional person under section 327 or 1103 of this title, as the case may be, on any reasonable terms and conditions of employment, including on a retainer, on an hourly basis, on a fixed or percentage fee basis, or on a contingent fee basis.
50. The Debtor requests that the Court approve KHP's compensation on the terms set forth in the Engagement Letter, as described in Section VI above, pursuant to section 328(a) of the Bankruptcy Code. Courts in this District and throughout the country have routinely approved fee arrangements for financial advisors that include a combination of monthly advisory fees, success-based or completion fees, and expense reimbursement. See, e.g., In re Chesapeake Energy Corp., Case No. 20-33233 (Bankr. S.D. Tex. 2020) (approving financial advisor retention with completion fee); In re Seadrill Ltd., Case No. 17-60079 (Bankr. S.D. Tex. 2017) (same in maritime context).
51. The completion fee structure proposed herein — $4,500,000 upon the effective date of a confirmed plan, consummation of a sale transaction, or execution of a restructuring support agreement, or $2,000,000 upon the filing of a Chapter 11 petition — is consistent with fee arrangements routinely approved in Chapter 11 cases in this and other jurisdictions for financial advisors of comparable standing and expertise. The completion fee appropriately incentivizes KHP to work diligently toward a successful restructuring outcome that maximizes value for the Debtor's estate and its stakeholders.
52. The monthly advisory fee of $250,000 is commensurate with the scope, complexity, and demands of the engagement. The engagement involves a cross-border shipping conglomerate with aggregate debt of approximately $847.3 million, a fleet of 50 vessels, multiple secured and unsecured creditor constituencies, and the potential for parallel insolvency proceedings in Greece. The monthly advisory fee reflects the substantial and ongoing commitment of senior professional resources by KHP, including the time of Mr. Calloway and his team, and is reasonable in light of the magnitude and complexity of the matters at issue.
53. The Debtor respectfully submits that KHP's proposed compensation is reasonable and should be approved under section 328(a) of the Bankruptcy Code.
C. Nunc Pro Tunc Relief
54. The Debtor requests that KHP's retention be approved nunc pro tunc to the Petition Date. Courts routinely approve nunc pro tunc retention of professionals whose services are essential to the debtor's restructuring efforts from the outset of the Chapter 11 case, particularly where, as here, the professional was retained prepetition and has developed significant institutional knowledge and work product that is critical to the case. See, e.g., In re Calfrac Well Servs. Corp., Case No. 20-33529 (Bankr. S.D. Tex. 2020); In re LATAM Airlines Grp. S.A., Case No. 20-11254 (Bankr. S.D.N.Y. 2020).
55. KHP's prepetition work product — including its enterprise valuation of $580 million to $640 million, its recovery waterfall analyses for each creditor class, and its 13-week cash flow models — forms the analytical foundation for the Debtor's restructuring strategy. KHP's institutional knowledge of the Debtor's business, capital structure, and ongoing negotiations with creditor constituencies cannot be replicated by another advisor without significant delay and cost. Any interruption in KHP's services, even for the period between the Petition Date and the entry of a retention order, would be materially harmful to the estate and would undermine the Debtor's ability to meet the milestones and deadlines that are anticipated under the DIP Facility and the restructuring timeline. Accordingly, nunc pro tunc relief is warranted and appropriate.
IX. NOTICE
56. Notice of this Application has been given to the following parties or their counsel:
(a) The Office of the United States Trustee for the Southern District of Texas, Region 7;
(b) Nordbank International AG, as Administrative Agent and Collateral Agent under the Senior Secured Credit Facility, by its counsel Whitfield, Crane & Burgess LLP, 51 West 52nd Street, 38th Floor, New York, New York 10019, Attn: Graham Whitfield III;
(c) The members of the Ad Hoc Group of Senior Secured Lenders (comprising Nordbank International AG, Harborstone Bank plc, Triton Credit Partners LP, and Continental Maritime Lending GmbH), through counsel to the Ad Hoc Group;
(d) Dralvecen Mezzanine Capital LLC, by its counsel Kellner & Foss LLP, 1185 Avenue of the Americas, 30th Floor, New York, New York 10036, Attn: Theodore Kellner;
(e) Garrison Trust Company, as indenture trustee for the Unsecured Notes, by counsel Ashford, Brightmoor Group & McKay PC, 299 Park Avenue, 18th Floor, New York, New York 10171, Attn: Carolyn Brightmoor Group;
(f) All parties who have filed requests for notice pursuant to Bankruptcy Rule 2002;
(g) Draycott Advisory Group LLC, as financial advisor to the Ad Hoc Group, 520 Madison Avenue, 20th Floor, New York, New York 10022, Attn: Vanessa Chow.
57. The Debtor submits that the foregoing notice is sufficient under the circumstances and that no other or further notice need be given.
X. PRAYER FOR RELIEF
WHEREFORE, the Debtor respectfully requests that the Court enter an order, substantially in the form of the Proposed Order attached hereto as Exhibit B:
1. Authorizing the Debtor to retain and employ Kensington Veltrian Partners LLC as its financial advisor, nunc pro tunc to the Petition Date, pursuant to sections 327(a) and 328(a) of the Bankruptcy Code;
2. Approving the compensation terms set forth in the Engagement Letter, including the monthly advisory fee of $250,000, the completion fee of $4,500,000 (or the filing fee of $2,000,000, as applicable), and the reimbursement of reasonable and documented out-of-pocket expenses;
3. Granting such other and further relief as the Court deems just and proper.
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
Proposed Counsel to the Debtor
CALDERWOOD & HARKNESS LLP
By: ________
Nathaniel Bower Responsible Partner
Colette Whitman Billing Partner
Amy Chesterton Lead Associate
Nathan Ikeda Working Associate
780 Third Avenue New York, New York 10017 Telephone: (212) 555-0400 Facsimile: (212) 555-0401
Matter No. 1044-00003
Dated: January 20, 2023
EXHIBIT A
VERIFIED STATEMENT OF JAMES CALLOWAY PURSUANT TO BANKRUPTCY RULES 2014 AND 2016
UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
VERIFIED STATEMENT OF JAMES CALLOWAY IN SUPPORT OF APPLICATION TO RETAIN KENSINGTON VELTRIAN PARTNERS LLC AS FINANCIAL ADVISOR TO THE DEBTOR PURSUANT TO BANKRUPTCY RULES 2014(a) AND 2016
I, James Calloway, being duly authorized, hereby declare as follows pursuant to 28 U.S.C. § 1746:
A. Introduction and Background
1. I am a Managing Director of Kensington Veltrian Partners LLC ("KHP"), a financial advisory firm with its principal office located at 300 Park Avenue, 12th Floor, New York, New York 10022. I am the primary professional responsible for KHP's engagement by Thalassa Americas Inc. ("TAI" or the "Debtor") and Thalassa Shipping & Logistics Société Anonyme ("TSL") (together with the Debtor, the "Clients"). I submit this Verified Statement (this "Declaration") in support of the Application of the Debtor for Entry of an Order Authorizing the Retention and Employment of Kensington Veltrian Partners LLC as Financial Advisor to the Debtor (the "Application"). I am authorized to submit this Declaration on behalf of KHP. The facts set forth herein are based upon my personal knowledge, upon my review of relevant documents and records maintained by KHP, and upon information provided to me by other KHP professionals. If called as a witness, I could and would competently testify to the matters set forth herein.
2. KHP is a nationally recognized financial advisory firm that provides restructuring, mergers and acquisitions, capital markets, and litigation support advisory services to companies, creditors, investors, and other parties in interest in complex financial situations. KHP employs approximately 85 professionals and has particular depth and expertise in the maritime and shipping, energy, transportation, and industrial sectors. KHP professionals have advised in dozens of restructurings and Chapter 11 cases involving aggregate funded indebtedness in excess of $150 billion.
3. I have more than twenty years of experience in the field of restructuring and financial advisory. During my career, I have led financial advisory engagements in numerous complex restructurings, both in and out of court, involving cross-border elements, large secured lending syndicates, capital-intensive asset bases, and multiple creditor constituencies. I hold a Bachelor of Science in Finance from the Wharton School of the University of Pennsylvania and a Master of Business Administration from Columbia Business School. Prior to joining KHP, I held senior positions at two other nationally recognized restructuring advisory firms.
4. KHP's engagement by the Clients encompasses the following primary services: restructuring advisory, preparation of 13-week cash flow forecasts, creditor negotiations, enterprise valuation, recovery waterfall analysis, and plan support services. The scope of services to be provided in the Chapter 11 case is described in the Application and is incorporated herein by reference.
B. Prepetition Engagement History
5. KHP was engaged prepetition by TSL and TAI in connection with the liquidity crisis and restructuring alternatives facing the Clients, as described in the Application. The prepetition engagement was entered into following the covenant breaches under the Senior Secured Credit Facility in September 2022 and the execution of the Forbearance Agreement on October 10, 2022.
6. Since its prepetition retention, KHP has provided the following advisory services to the Clients:
(a) Enterprise Valuation. KHP prepared a preliminary enterprise valuation of TSL and TAI on a consolidated basis, employing a discounted cash flow analysis, comparable company analysis, and comparable transaction analysis. The resulting valuation range was $580 million to $640 million (midpoint: $610 million) as of November 2022. The valuation was presented to the management and boards of directors of TSL and TAI and has been shared with creditor constituencies in the context of restructuring negotiations.
(b) Recovery Waterfall Analysis. Based on the enterprise valuation, KHP prepared detailed recovery waterfall analyses for each class of creditors. At the midpoint enterprise value of $610 million, after accounting for the approximately $540 million in outstanding principal under the Senior Secured Credit Facility plus estimated accrued interest and fees, the Mezzanine Notes were estimated to recover approximately 62.3% of their $112.3 million outstanding balance. The Unsecured Notes were estimated to recover between approximately 8% and 14% of their $50 million outstanding balance, depending on assumptions regarding administrative costs, professional fees, and the treatment of certain intercompany and subordinated claims.
(c) 13-Week Cash Flow Forecasting. KHP prepared and updated rolling 13-week cash flow forecasts for TAI, incorporating assumptions regarding charter revenue (based on current and projected time-charter equivalent rates), terminal income, operating expenses, debt service obligations (to the extent being serviced during the forbearance period), and liquidity. These forecasts were furnished to the Senior Secured Lenders as required under the Forbearance Agreement.
(d) Creditor Negotiations. KHP participated in negotiations with the Ad Hoc Group of Senior Secured Lenders, Dralvecen Mezzanine Capital LLC, and the informal unsecured noteholder group. These negotiations addressed, among other things, the terms of a potential restructuring support agreement, the parameters of a potential DIP financing facility, and the treatment of each class of creditors under a potential plan of reorganization.
C. Compensation Disclosure
7. Pursuant to Bankruptcy Rule 2016(b), I disclose the following with respect to KHP's compensation in connection with this engagement:
(a) Monthly Advisory Fee. KHP is entitled to a monthly advisory fee of $250,000, payable in arrears on the first business day of each succeeding month.
(b) Completion Fee. Upon the effective date of a confirmed Chapter 11 plan of reorganization, the consummation of a sale of substantially all of the Clients' assets, or the execution of an out-of-court restructuring support agreement approved by the requisite creditor constituencies, KHP is entitled to a completion fee of $4,500,000.
(c) Filing Fee. Upon the filing of a Chapter 11 petition (if no alternative transaction constituting a Completion Event has been consummated as of the filing date), KHP is entitled to a filing fee of $2,000,000.
(d) Fee Credit. The completion fee is creditable against fifty percent (50%) of the aggregate monthly advisory fees previously paid to KHP during the engagement.
(e) Expense Reimbursement. KHP is entitled to reimbursement of all reasonable and documented out-of-pocket expenses incurred in connection with the engagement.
(f) Prepetition Fees Received. Prior to the Petition Date, KHP received the following amounts in connection with the prepetition engagement: [amounts to be specified upon filing]. KHP did not receive or require a retainer in connection with this engagement.
D. Disclosure of Connections
8. Pursuant to Bankruptcy Rule 2014(a), I have made a diligent inquiry to identify any connections between KHP and its professionals, on the one hand, and the Debtor, its creditors, other parties in interest, their attorneys and accountants, the United States Trustee, and persons employed in the office of the United States Trustee, on the other hand. Set forth below are the results of that inquiry.
9. The Debtor and Its Affiliates. KHP's sole connection to TAI and TSL is through the engagement described in this Declaration and the Application. KHP has not previously provided services to TAI, TSL, KFO Holdings Société Anonyme, or any of the fourteen vessel-owning SPVs, other than in connection with the current engagement. KHP does not hold any claim against, or any equity or other interest in, TAI, TSL, KFO Holdings, or any affiliated entity.
10. Officers and Directors. KHP has no connection with any officer or director of TAI or TSL, including Dimitrios Kostandinos (Chairman of TSL), Elena Kostandinos-Pavlou (Vice Chairwoman of TSL), Georgios Andreadis (CEO of TSL), Irini Dalakoura (CFO of TSL), Marcus Hale (President of TAI), Diana Restrepo (VP Finance of TAI), or Jonathan Kurtz (VP Operations of TAI), other than in connection with the current engagement.
11. Secured Creditors. KHP has represented one or more members of the Senior Secured Lender syndicate — specifically, [to be identified with particularity upon filing] — in matters wholly unrelated to the Debtor, TSL, or the obligations at issue in this case. Those prior unrelated representations are described as follows: [to be described with particularity upon filing]. KHP has concluded that such prior unrelated representations do not create any actual or potential conflict of interest with respect to the current engagement. KHP has not provided any services to Nordbank International AG in its capacity as Administrative Agent or Collateral Agent under the Senior Secured Credit Facility or in any capacity related to the Debtor or TSL. KHP has reviewed the identities and roles of each syndicate member — Nordbank International AG, Aegean Capital Bank SA, Harborstone Bank plc, Pacifica Trade Finance Corp., Continental Maritime Lending GmbH, Triton Credit Partners LP, Laurentian Shipping Fund II, Caspian Asset Management Ltd., and Pelagos Institutional Credit Fund — and, except as disclosed above, has no connection with any such entity.
12. Mezzanine Lender. KHP has no connection with Dralvecen Mezzanine Capital LLC or any of its principals, including Rebecca Marsh, other than through the arm's-length creditor negotiations conducted in the course of the current engagement.
13. Unsecured Note Trustee. KHP has no connection with Garrison Trust Company in its capacity as indenture trustee for the Unsecured Notes or in any other capacity.
14. Trade Creditors. KHP has no connection with any of the Debtor's trade creditors, including Olympian Fuel & Supply SA, the Debtor's largest trade creditor.
15. Counsel to All Parties. KHP has no connection with the following law firms that serve as counsel to parties in interest in this case, other than as may arise in the ordinary course of the restructuring practice:
(a) Calderwood & Harkness LLP (proposed counsel to the Debtor);
(b) Whitfield, Crane & Burgess LLP (counsel to the Ad Hoc Group and Nordbank);
(c) Kellner & Foss LLP (counsel to Dralvecen Mezzanine Capital LLC);
(d) Ashford, Brightmoor Group & McKay PC (counsel to the Unsecured Noteholder Group and Garrison Trust Company);
(e) Vassiliou & Demetriou Law Offices (Greek counsel to TSL).
KHP confirms that it has not been engaged by, and has no financial relationship with, any of the foregoing law firms in connection with this matter or any related matter.
16. Other Professionals. KHP has no material connection with any of the following other professionals that are involved or are expected to be involved in this Chapter 11 case:
(a) Draycott Advisory Group LLC (financial advisor to the Ad Hoc Group);
(b) Alderney Management Advisors LLC;
(c) Grainger, Holt & Associates LLP;
(d) Pendleton Claim Services Inc.;
(e) Drakos Maritime Valuations Ltd.;
(f) Seaward & Beckett Insurance Brokers Ltd.
17. United States Trustee. KHP has no connection with the United States Trustee for the Southern District of Texas, Region 7, or any person employed in the office of the United States Trustee.