EQUITY SUBSCRIPTION AGREEMENT
dated as of
May 22, 2023
by and between
THALASSA SHIPPING & LOGISTICS SOCIÉTÉ ANONYME
and
KFO HOLDINGS SOCIÉTÉ ANONYME
EQUITY SUBSCRIPTION AGREEMENT
This EQUITY SUBSCRIPTION AGREEMENT (this "Agreement") is entered into as of May 22, 2023, by and between:
(1) THALASSA SHIPPING & LOGISTICS SOCIÉTÉ ANONYME (the "Company" or "TSL"), a société anonyme organized and existing under the laws of the Hellenic Republic, with registered offices at 42 Akti Miaouli, Piraeus 18538, Greece, registered with the Athens General Commercial Registry (Γ.Ε.ΜΗ.), Greek Tax Identification Number (ΑΦΜ) 998214763;
and
(2) KFO HOLDINGS SOCIÉTÉ ANONYME ("KFO" or the "Subscriber"), a société anonyme organized and existing under the laws of the Hellenic Republic, with registered offices at 42 Akti Miaouli, Piraeus 18538, Greece.
The Company and the Subscriber are each referred to herein as a "Party" and collectively as the "Parties."
This Agreement is entered into in connection with and pursuant to the Restructuring Support Agreement dated March 14, 2023 (as may be amended, supplemented, or otherwise modified from time to time, the "RSA"), among, inter alia, the Company, Thalassa Americas Inc., Nordbank International AG (as administrative agent and collateral agent), the consenting senior secured lenders party thereto, Dralvecen Mezzanine Capital LLC, and KFO.
Right-click to update Table of Contents
RECITALS
A. Thalassa Shipping & Logistics Société Anonyme is a Greek-headquartered private shipping and logistics conglomerate founded in 1987 by the Kostandinos family. The Company owns and operates a fleet of thirty-eight (38) dry-bulk carriers and twelve (12) container vessels, totaling fifty (50) vessels, and provides integrated port-to-door logistics services across the Mediterranean Sea, the Black Sea, and transatlantic trade lanes. The Company also operates terminal facilities at Piraeus (Greece), Thessaloniki (Greece), and Houston (Texas, United States of America). TSL's wholly-owned United States subsidiary is Thalassa Americas Inc. ("TAI"), a Delaware C-Corporation with its principal office at 1400 McKinney Street, Suite 2200, Houston, Texas 77010, United States, Employer Identification Number (EIN) 84-3291057. As of the date hereof, the Company employs approximately 4,200 people globally, of whom approximately 680 are employed in the United States. The Company's consolidated revenue for the fiscal year ended December 31, 2021 ("FY2021") was approximately €1.42 billion, and its estimated consolidated revenue for the fiscal year ended December 31, 2022 ("FY2022") is approximately €987 million, representing a decline of approximately 30.5% year-over-year.
B. Beginning in mid-2022, the Company experienced a severe liquidity crisis driven principally by the collapse in dry-bulk charter rates—the Baltic Dry Index declined by approximately 58% between January 2022 and September 2022—and by significant vessel impairments recognized during the same period. As a direct consequence of these adverse market conditions, on September 15, 2022, the Company breached the Minimum Liquidity Covenant set forth in its $685 million Senior Secured Credit Facility (pursuant to the Senior Secured Credit Agreement originally dated June 15, 2019, among the Company, TAI, and Nordbank International AG, as administrative agent and collateral agent, and the lenders party thereto), when the Company's unrestricted cash balance fell to $27.3 million, compared to the required minimum of $40 million, resulting in a shortfall of $12.7 million. As of September 30, 2022, the Company further breached the Maximum Net Leverage Ratio covenant (actual: 7.82x versus the 5.50x maximum permitted) and the Minimum Interest Coverage Ratio covenant (actual: 1.74x versus the 2.50x minimum required). Total consolidated indebtedness of the Company and its subsidiaries as of September 30, 2022 was approximately $847.3 million, consisting of approximately $540 million outstanding under the Senior Secured Credit Facility, approximately $112.3 million in mezzanine notes held by Dralvecen Mezzanine Capital LLC ("BMC"), $50 million in unsecured notes, and approximately $76.4 million in intercompany indebtedness owed by TAI to TSL.
C. Following the covenant breaches described above, on October 10, 2022, a Forbearance Agreement was executed by and among the Company, TAI, and the senior secured lender syndicate (with Nordbank International AG acting as administrative agent and collateral agent), providing for a ninety (90)-day standstill period through January 8, 2023. The standstill period was subsequently extended on two occasions: first, to March 8, 2023, and thereafter to April 7, 2023. During the forbearance period, the Company retained Calderwood & Harkness LLP as its restructuring legal counsel and Kensington Veltrian Partners LLC as its financial advisor to explore and evaluate restructuring alternatives for the Company and its subsidiaries.
D. Following extensive arm's-length negotiations among the Company, TAI, the senior secured lenders, BMC, and KFO, the RSA was executed on March 14, 2023. The RSA contemplates, among other things: (i) Amendment No. 1 to the Senior Secured Credit Agreement, providing for, inter alia, an extension of the maturity date from June 15, 2024 to June 15, 2027, the conversion of $75 million of Term Loan A principal to pay-in-kind ("PIK") interest, a reduction of the revolving credit commitment from $200 million to $150 million, a resetting of financial covenants, an amendment fee of $5.4 million (payable in kind), and a retroactive waiver of all default interest accrued since the date of the initial covenant breach; (ii) the exchange of BMC's $112.3 million mezzanine notes for $60 million in newly issued second-lien notes (bearing interest at 10.0% PIK, maturing June 2028) plus 15% of the outstanding equity of TSL (representing a 46.6% haircut on the debt component of BMC's mezzanine position) (the "Mezzanine Exchange"); (iii) the equity subscription by KFO contemplated by this Agreement; (iv) certain vessel dispositions; and (v) an amendment and restatement of the intercompany note between TAI and TSL. The RSA has an Outside Date of June 30, 2023.
E. KFO is the family holding company of the Kostandinos family. Prior to the consummation of the transactions contemplated by the RSA, KFO's principals—Dimitrios Kostandinos (who serves as Chairman of the Board of Directors of TSL and holds, directly and through KFO, 62% of the outstanding equity of the Company) and Elena Kostandinos-Pavlou (who serves as Vice Chairwoman of the Board of Directors of TSL and holds, directly and through KFO, 18% of the outstanding equity of the Company)—collectively hold 80% of the outstanding equity of TSL. Following the issuance of 15% of the Company's equity to BMC in connection with the Mezzanine Exchange, the Kostandinos family's aggregate equity interest will be diluted from 80% to approximately 68%, and the aggregate equity interest of non-family holders (excluding BMC) will be diluted from 20% to approximately 17%.
F. KFO desires to subscribe for newly issued ordinary shares of the Company (the "New Shares") in the aggregate amount of €35,000,000 (approximately $38,200,000 at a Euro/Dollar exchange rate of €1 = $1.0914 as of March 14, 2023), with the proceeds to be used to fund the Company's liquidity needs and to pay transaction costs associated with the transactions contemplated by the RSA. The subscription contemplated by this Agreement is a condition precedent to the effectiveness of the RSA and the closing of the transactions contemplated thereby.
G. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I — DEFINITIONS AND INTERPRETATION
Section 1.1 — Definitions
As used in this Agreement, the following terms shall have the meanings set forth below:
"Amendment No. 1" means Amendment No. 1 to the Senior Secured Credit Agreement, dated as of May 15, 2023, by and among the Company, TAI, Nordbank International AG (as administrative agent and collateral agent), and the lenders party thereto.
"Amended and Restated Intercreditor Agreement" means the Amended and Restated Intercreditor Agreement, dated as of May 15, 2023, by and between Nordbank International AG (in its capacity as administrative agent and collateral agent under the Senior Secured Credit Facility) and Dralvecen Mezzanine Capital LLC (in its capacity as holder of the New Second-Lien Notes).
"BMC" means Dralvecen Mezzanine Capital LLC, a Delaware limited liability company, with its principal office at 600 Lexington Avenue, 22nd Floor, New York, New York 10022.
"Board" means the board of directors (Διοικητικό Συμβούλιο) of TSL.
"Business Day" means a day (other than a Saturday or Sunday) on which commercial banks are generally open for the transaction of normal banking business in each of Piraeus, Athens, Zürich, and New York City.
"Closing" means the closing of the transactions contemplated by this Agreement, as described in Article VII hereof.
"Closing Date" means the date on which the Closing occurs, which is targeted for June 30, 2023 (the RSA Outside Date), or such other date as the Parties may mutually agree in writing.
"Company" means Thalassa Shipping & Logistics Société Anonyme, a société anonyme organized under the laws of the Hellenic Republic, together with, where the context so requires, its subsidiaries.
"Equity Subscription Amount" means thirty-five million Euros (€35,000,000).
"Exchange Rate" means the spot exchange rate of €1 = $1.0914, being the exchange rate as quoted by the European Central Bank as of the close of business on March 14, 2023, as referenced in the RSA.
"Funds Flow Memorandum" means the funds flow memorandum dated June 29, 2023, prepared by Kensington Veltrian Partners LLC and Calderwood & Harkness LLP, setting forth the wire transfer instructions and the allocation of funds at Closing.
"Governmental Authority" means any Greek, United States federal, state, or local, or other national, supranational, or international governmental, regulatory, or administrative body, authority, agency, commission, tribunal, or court of competent jurisdiction.
"Greek Law" means the laws, statutes, regulations, codes, decrees, and orders of the Hellenic Republic, including without limitation applicable corporate law (Greek Law 4548/2018, as amended), tax law, maritime law, insolvency law (including Greek Law 4738/2020 on Debt Settlement and Insolvency), and any implementing regulations, directives, and guidelines.
"Intercreditor Agreement" means the original intercreditor agreement dated as of June 15, 2019, by and between Nordbank International AG and Dralvecen Mezzanine Capital LLC, as amended and restated by the Amended and Restated Intercreditor Agreement.
"KFO" or "Subscriber" means KFO Holdings Société Anonyme, a société anonyme organized under the laws of the Hellenic Republic, with registered offices at 42 Akti Miaouli, Piraeus 18538, Greece.
"Material Adverse Effect" means any event, change, circumstance, development, effect, occurrence, or condition that, individually or in the aggregate, has had, or would reasonably be expected to have, a material adverse effect on (a) the business, financial condition, assets, liabilities, or results of operations of the Company and its subsidiaries, taken as a whole, or (b) the ability of the Company to consummate the transactions contemplated by this Agreement and the other Transaction Documents; provided, however, that none of the following, either alone or in combination, shall be deemed to constitute, or shall be taken into account in determining whether there has been or would reasonably be expected to be, a Material Adverse Effect: (i) changes in general economic, financial, market, or political conditions (including changes in prevailing interest rates, exchange rates, or commodity prices) to the extent such changes do not disproportionately affect the Company and its subsidiaries relative to other participants in the industries in which they operate; (ii) changes in the shipping industry generally, including fluctuations in the Baltic Dry Index or charter rates; (iii) changes in applicable law or accounting standards; (iv) any outbreak or escalation of hostilities, war, or terrorism; (v) the announcement or pendency of this Agreement or the RSA transactions; or (vi) the matters specifically disclosed in the RSA in connection with the liquidity crisis and covenant breaches described therein.
"Mezzanine Exchange" means the exchange of BMC's $112.3 million mezzanine notes for (a) $60 million aggregate principal amount of New Second-Lien Notes and (b) 15% of the outstanding equity of the Company, on the terms set forth in the RSA and the New Second-Lien Note Purchase Agreement.
"New Second-Lien Note Purchase Agreement" means the Second-Lien Note Purchase Agreement, dated as of May 18, 2023, by and between the Company and BMC, pursuant to which BMC will receive the New Second-Lien Notes in exchange for its mezzanine notes.
"New Second-Lien Notes" means the 10.0% PIK second-lien secured notes due June 2028 to be issued by the Company to BMC in connection with the Mezzanine Exchange.
"New Shares" means the newly issued ordinary shares of the Company to be subscribed for by KFO and issued by the Company pursuant to this Agreement.
"Nordbank" means Nordbank International AG, a Swiss Aktiengesellschaft, with offices at Bahnhofstrasse 78, 8001 Zürich, Switzerland, acting in its capacity as administrative agent and collateral agent under the Senior Secured Credit Facility.
"Outside Date" means June 30, 2023, or such later date as may be agreed in writing by the Parties and Nordbank (as administrative agent).
"Person" means any individual, corporation, partnership, limited liability company, société anonyme, joint venture, trust, unincorporated association, Governmental Authority, or other entity.
"RSA" means the Restructuring Support Agreement dated as of March 14, 2023, by and among the Company, TAI, Nordbank International AG, the consenting senior secured lenders, Dralvecen Mezzanine Capital LLC, and KFO, as may be amended, supplemented, or otherwise modified from time to time.
"Senior Secured Credit Agreement" means the Senior Secured Credit Agreement dated as of June 15, 2019, by and among the Company, TAI (as U.S. borrower), Nordbank International AG (as administrative agent and collateral agent), and the lenders from time to time party thereto, as amended by Amendment No. 1 and as may be further amended, restated, supplemented, or otherwise modified from time to time.
"Senior Secured Credit Facility" means the $685 million senior secured credit facility provided under the Senior Secured Credit Agreement, consisting of a Term Loan A tranche, a revolving credit tranche, and a Term Loan B tranche.
"Subscription Price" means the per-share price at which the New Shares are issued, as determined by dividing the Equity Subscription Amount by the number of New Shares.
"TAI" means Thalassa Americas Inc., a C-Corporation organized under the laws of the State of Delaware, United States, EIN 84-3291057, with its principal office at 1400 McKinney Street, Suite 2200, Houston, Texas 77010.
"Transaction Costs" means all fees, costs, expenses, and disbursements incurred by the Company and its subsidiaries in connection with the negotiation, documentation, and consummation of the transactions contemplated by the RSA and the Transaction Documents, including without limitation all fees and expenses payable to Calderwood & Harkness LLP, Kensington Veltrian Partners LLC, Vassiliou & Demetriou Law Offices, Grainger, Holt & Associates LLP, Drakos Maritime Valuations Ltd., and other professional advisors, as well as all filing fees, registration fees, and similar charges.
"Transaction Documents" means this Agreement, Amendment No. 1, the Amended and Restated Intercreditor Agreement, the New Second-Lien Note Purchase Agreement, the New Second-Lien Notes Indenture, the Lock-Up Agreement, the Joinder Agreement, the Side Letter Agreement, the Amended and Restated Intercompany Promissory Note, the Funds Flow Memorandum, and all other agreements, instruments, certificates, and documents executed and delivered in connection with the RSA transactions.
Section 1.2 — Interpretation
Unless the context of this Agreement otherwise requires: (a) headings of Articles, Sections, Schedules, and Exhibits are for convenience of reference only and shall not affect the interpretation of this Agreement; (b) words importing the singular shall include the plural and vice versa, and words importing a gender shall include all genders; (c) references to "Articles," "Sections," "Schedules," and "Exhibits" are to Articles, Sections, Schedules, and Exhibits of this Agreement; (d) references to any agreement, instrument, or document (including this Agreement) shall be deemed to include references to such agreement, instrument, or document as amended, supplemented, restated, or otherwise modified from time to time in accordance with its terms; (e) the words "including," "includes," and "include" shall be deemed to be followed by the words "without limitation"; (f) the words "hereof," "herein," "hereby," "hereto," and "hereunder" refer to this Agreement as a whole; (g) all amounts denominated in Euros ("€") and references to "$" or "Dollar" are to United States Dollars; Dollar equivalents of Euro amounts are provided for reference purposes only based on the Exchange Rate, unless otherwise specified; (h) in the event of any inconsistency between the English-language version and any Greek-language version of this Agreement, both versions shall be equally authentic, but the Parties shall endeavor in good faith to resolve any such inconsistency; and (i) references to any Person shall include such Person's successors and permitted assigns.
ARTICLE II — SUBSCRIPTION AND ISSUANCE
Section 2.1 — Subscription
Subject to the terms and conditions of this Agreement, KFO hereby irrevocably subscribes for, and agrees to purchase, the New Shares at an aggregate subscription price equal to the Equity Subscription Amount of €35,000,000. The obligation of KFO to subscribe for and purchase the New Shares is absolute and unconditional, subject only to the satisfaction or waiver of the conditions set forth in Article VI hereof.
The number of New Shares to be issued to KFO shall be determined by the Board in accordance with Greek corporate law (including, without limitation, Greek Law 4548/2018, as amended) and the Company's articles of association (Καταστατικό), at a per-share Subscription Price reflecting the fair market value of the Company's equity as determined by the Board based on, and consistent with, the enterprise valuation prepared by Kensington Veltrian Partners LLC in connection with the RSA (the "Enterprise Valuation"). The Enterprise Valuation, which was presented to the Board and to the Parties in connection with the execution of the RSA, estimates the total enterprise value of the Company and its subsidiaries at between $580 million and $640 million, with a midpoint of $610 million. The Subscription Price shall be set at a level consistent with the midpoint enterprise value (or such other point within the range as may be approved by the Board in its reasonable discretion), after giving effect to all indebtedness, minority interests, and the dilutive impact of the Mezzanine Exchange.
Section 2.2 — Issuance
Subject to the satisfaction or waiver of the conditions set forth in Article VI hereof, on the Closing Date the Company shall issue the New Shares to KFO, and such New Shares shall be registered in the name of KFO in the Company's share register (Βιβλίο Μετόχων) and in any applicable registry, including the Athens General Commercial Registry (Γ.Ε.ΜΗ.), in accordance with the requirements of Greek Law. The Company shall use its commercially reasonable efforts to cause such registration to be effected promptly on or as soon as practicable following the Closing Date.
The New Shares shall be ordinary registered shares (κοινές ονομαστικές μετοχές) of the Company, fully paid and non-assessable, ranking pari passu in all respects with all other outstanding ordinary shares of the Company as of the Closing Date, including with respect to voting rights, dividend rights, and liquidation preferences. The issuance of the New Shares is subject to, and shall take into account, the dilutive effect of the issuance of 15% of the Company's equity to BMC in connection with the Mezzanine Exchange. For the avoidance of doubt, the New Shares are issued in addition to (and not in replacement of) KFO's existing equity holdings in the Company.
Section 2.3 — Use of Proceeds
The Company shall apply the proceeds of the Equity Subscription Amount as follows, in the following order of priority:
(a) First, to fund the general corporate liquidity needs of the Company and its subsidiaries (including TAI), including working capital, vessel operating expenses, port and terminal operating expenses, and other ordinary-course expenditures necessary to maintain the Company's operations during the restructuring period and thereafter;
(b) Second, to pay Transaction Costs, including without limitation the following:
(i) fees and disbursements of Calderwood & Harkness LLP (restructuring legal counsel to the Company);
(ii) the completion fee payable to Kensington Veltrian Partners LLC (financial advisor to the Company), in the amount of $4,500,000;
(iii) fees and disbursements of Vassiliou & Demetriou Law Offices (Greek legal counsel to the Company);
(iv) fees and disbursements of Grainger, Holt & Associates LLP (independent auditors);
(v) all other professional fees and expenses incurred in connection with the RSA transactions, including filing fees, registration fees, valuation fees, and printing costs;
(c) Third, for such other purposes as the Board may determine, in its reasonable business judgment, to be consistent with the terms and objectives of the RSA.
No portion of the proceeds of the Equity Subscription Amount shall be used, directly or indirectly, to make any distribution, dividend, or return of capital to any equity holder of the Company, or to prepay, redeem, repurchase, or retire any indebtedness of the Company or any of its subsidiaries, except as expressly contemplated by the RSA. Without limiting the generality of the foregoing, the Parties acknowledge and agree that the payment of the missed coupon of $2,062,500 under the Company's $50,000,000 8.25% Senior Unsecured Notes due 2025 (CUSIP 87265BAB5), originally due on December 1, 2022, to Garrison Trust Company (as indenture trustee for such notes) is expressly contemplated by the RSA and constitutes a permitted use of proceeds hereunder.
Section 2.4 — Dilution and Post-Closing Equity Structure
The Parties acknowledge and agree that, following the Closing and the consummation of the Mezzanine Exchange:
(a) BMC will hold 15% of the outstanding equity of the Company, consisting of newly issued ordinary shares;
(b) the Kostandinos family (acting through KFO and directly) will hold approximately 68% of the outstanding equity of the Company (diluted from 80% prior to the RSA transactions); and
(c) non-family holders (excluding BMC) will hold approximately 17% of the outstanding equity of the Company (diluted from 20% prior to the RSA transactions).
The New Shares subscribed by KFO hereunder are intended to maintain (but not increase beyond pre-dilution levels) the Kostandinos family's relative equity position vis-à-vis non-family, non-BMC holders. The pro forma post-Closing capitalization of the Company is set forth in detail on Schedule A attached hereto. The Parties agree that the issuance of the New Shares to KFO shall not be deemed a "distribution" or "return of capital" or a preferential allocation in favor of KFO for any purpose under the RSA, the Senior Secured Credit Agreement, or any other Transaction Document.
ARTICLE III — REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Subscriber as of the date hereof and as of the Closing Date (except where a representation or warranty is expressly stated to be made as of a specific date, in which case such representation or warranty is made only as of such specified date) as follows:
Section 3.1 — Organization and Good Standing
The Company is a société anonyme duly organized, validly existing, and in good standing under the laws of the Hellenic Republic, duly registered with the Athens General Commercial Registry (Γ.Ε.ΜΗ.). The Company has the corporate power and authority to own, lease, and operate its properties and assets and to carry on its business as currently conducted and as proposed to be conducted. The Company is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the ownership or leasing of its properties or the conduct of its business requires such qualification or licensing, except where the failure to be so qualified or licensed would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 3.2 — Authorization
The execution, delivery, and performance of this Agreement by the Company, and the consummation by the Company of the transactions contemplated hereby (including the issuance of the New Shares), have been duly authorized by all necessary corporate action on the part of the Company, including approval by the Board of Directors at a duly convened meeting at which a quorum was present. No further shareholder approval is required under Greek Law (including Greek Law 4548/2018, as amended) or the Company's articles of association for the issuance of the New Shares, or, to the extent any such shareholder approval is required, such approval has been, or will be, duly obtained prior to the Closing Date. This Agreement has been duly executed and delivered by the Company and constitutes a legal, valid, and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 3.3 — Capitalization
The authorized share capital of the Company consists of [number] ordinary registered shares, of which [number] ordinary registered shares are issued and outstanding as of the date hereof. The issued and outstanding shares of the Company are owned of record and beneficially as follows:
All outstanding shares have been duly authorized, validly issued, fully paid, and non-assessable. Other than (a) the New Shares to be issued to KFO pursuant to this Agreement and (b) the equity interests to be issued to BMC pursuant to the Mezzanine Exchange, no other shares, equity interests, options, warrants, conversion rights, exchange rights, subscription rights, or other agreements or commitments obligating the Company to issue, sell, or transfer any shares or other equity interests of the Company have been authorized, issued, or agreed to be issued.
Section 3.4 — No Conflicts
The execution, delivery, and performance of this Agreement by the Company, and the consummation by the Company of the transactions contemplated hereby (including the issuance of the New Shares), do not and will not:
(a) violate, conflict with, or result in a breach of any provision of the Company's articles of association (Καταστατικό) or any other organizational documents of the Company;
(b) breach, violate, constitute (with or without notice or lapse of time, or both) a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under, any material agreement, contract, lease, license, mortgage, indenture, or other instrument to which the Company is a party or by which any of its properties or assets is bound, including without limitation the Senior Secured Credit Agreement, the Forbearance Agreement, the RSA, the Amended and Restated Intercreditor Agreement, the mezzanine note documents, or the unsecured note indenture; or
(c) violate any applicable law, statute, regulation, rule, ordinance, order, judgment, injunction, or decree of any Governmental Authority applicable to the Company or any of its subsidiaries or by which any of their respective properties or assets is bound.
Section 3.5 — Consents and Approvals
All material consents, approvals, authorizations, orders, filings, registrations, and qualifications of or with any Governmental Authority or any other Person required in connection with the execution, delivery, and performance of this Agreement and the issuance of the New Shares have been obtained, or will be obtained prior to the Closing Date. Such consents and filings include, without limitation, any required filings with the Athens General Commercial Registry (Γ.Ε.ΜΗ.) and the Hellenic Capital Market Commission (Επιτροπή Κεφαλαιαγοράς), to the extent applicable, and any consents or waivers required under the Senior Secured Credit Agreement, as amended by Amendment No. 1, and the Amended and Restated Intercreditor Agreement.
Section 3.6 — Subsidiaries
Schedule B sets forth a complete and accurate list of all material subsidiaries of the Company as of the date hereof, including the name, jurisdiction of organization, and ownership percentage for each such subsidiary. Such material subsidiaries include, without limitation:
(a) Thalassa Americas Inc. ("TAI"), a C-Corporation organized under the laws of the State of Delaware, United States, EIN 84-3291057, with its principal office at 1400 McKinney Street, Suite 2200, Houston, Texas 77010. TAI's registered agent in the State of Delaware is Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801. TAI is a wholly-owned subsidiary of the Company; and
(b) fourteen (14) vessel-owning special purpose vehicles ("SPVs"), organized in various jurisdictions, each of which is a direct or indirect wholly-owned subsidiary of the Company and each of which holds title to one or more vessels in the Company's fleet, as set forth in detail on Schedule B.
Each material subsidiary is duly organized, validly existing, and in good standing (or its equivalent) under the laws of its jurisdiction of organization and has the corporate power and authority to own, lease, and operate its properties and assets and to carry on its business as currently conducted, except where the failure to be so organized, existing, or in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 3.7 — Financial Statements; No Undisclosed Liabilities
The Company has delivered or made available to KFO true, correct, and complete copies of (a) the audited consolidated financial statements of the Company and its subsidiaries for FY2021, which were audited by Grainger, Holt & Associates LLP (lead engagement partner: Malcolm Holt) in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union, and (b) the unaudited consolidated interim financial statements of the Company and its subsidiaries for the nine-month period ending September 30, 2022 (collectively, the "Financial Statements"). The Financial Statements present fairly, in all material respects, the financial condition, results of operations, and cash flows of the Company and its subsidiaries as of the dates and for the periods indicated, in conformity with IFRS applied on a consistent basis throughout the periods covered (subject, in the case of the unaudited interim financial statements, to normal year-end adjustments and the absence of footnote disclosures).
For reference, key financial metrics are as follows: FY2021 consolidated revenue of approximately €1.42 billion; estimated FY2022 consolidated revenue of approximately €987 million; last twelve months ("LTM") EBITDA (as defined in the Senior Secured Credit Agreement) of approximately $98.6 million as of September 30, 2022; LTM interest expense of approximately $56.7 million; and total consolidated indebtedness of approximately $847.3 million as of September 30, 2022.
Except as set forth in the Financial Statements or as otherwise disclosed in the RSA or the disclosure schedules hereto, neither the Company nor any of its subsidiaries has any liabilities (whether absolute, accrued, contingent, or otherwise) of a nature required to be disclosed in a balance sheet prepared in accordance with IFRS that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.
Section 3.8 — Material Adverse Effect
Since September 30, 2022, there has been no Material Adverse Effect on the Company or its subsidiaries, other than (a) the matters specifically disclosed in, arising from, or related to the liquidity crisis and covenant breaches described in the RSA and in the recitals to this Agreement, and (b) changes in general market conditions affecting the shipping industry as a whole, which in each case have been disclosed to KFO.
Section 3.9 — Fleet and Assets
The Company owns or operates a fleet of fifty (50) vessels, consisting of thirty-eight (38) dry-bulk carriers and twelve (12) container vessels. The fleet was appraised at an aggregate fair market value of approximately $623 million as of November 1, 2022, by Drakos Maritime Valuations Ltd. (Captain Nikos Drakos, principal, 28 Poseidonos Avenue, Piraeus 18531, Greece) (the "Fleet Appraisal"), compared to an aggregate fair market value of approximately $891 million as of January 2022, reflecting a decline of approximately $268 million (30.1%) over the ten-month period. The fleet is comprised of the following vessel classes and appraised values:
A detailed listing of each vessel, including vessel name, IMO number, flag state, year of build, and assigned SPV, is set forth on Schedule D attached hereto. All vessels in the fleet are subject to first-priority ship mortgages and liens in favor of the senior secured lender syndicate (through Nordbank as collateral agent) under the Senior Secured Credit Agreement, and second-priority ship mortgages and liens in favor of BMC under the mezzanine note documents (to be restructured pursuant to the Amended and Restated Intercreditor Agreement).
Section 3.10 — Indebtedness
Schedule C sets forth a true, correct, and complete schedule of all indebtedness of the Company and its subsidiaries as of the date hereof. Such indebtedness includes, without limitation, the following:
(a) Senior Secured Credit Facility: $540 million outstanding, consisting of (i) Term Loan A: approximately $270 million outstanding (CUSIP 87265BAA7), (ii) Revolving Credit Facility: approximately $185 million drawn, and (iii) Term Loan B: approximately $85 million outstanding. Nordbank International AG serves as administrative agent and collateral agent. The Senior Secured Credit Facility is secured by first-priority liens on substantially all assets of the Company and its subsidiaries, including ship mortgages on all vessels;
(b) Mezzanine Notes: $112.3 million outstanding (consisting of $100 million original principal amount plus approximately $12.3 million of accrued PIK interest), held by BMC. The mezzanine notes bear interest at 11.5% PIK toggle and are secured by second-priority liens on the assets securing the Senior Secured Credit Facility. The mezzanine notes are to be exchanged pursuant to the Mezzanine Exchange;
(c) Unsecured Notes: $50 million aggregate principal amount of 8.25% Senior Unsecured Notes due 2025, CUSIP 87265BAB5, issued pursuant to an indenture with Garrison Trust Company as indenture trustee. A coupon payment of $2,062,500 due December 1, 2022 was missed and remains outstanding;
(d) Intercompany Note (TAI → TSL): $76.4 million subordinated intercompany promissory note from TAI to TSL. Pursuant to the RSA, this note is to be amended and restated, with the interest rate reduced from 5.0% to 2.0% and the maturity extended to December 2028; and
(e) Trade Payables: approximately $38.7 million in aggregate trade payables to third-party vendors and suppliers, the largest of which is Olympian Fuel & Supply SA, to which the Company owes approximately $9.2 million.
Section 3.11 — Litigation
Except as set forth on the litigation schedule delivered to KFO in connection with the RSA, there is no action, suit, proceeding, claim, arbitration, investigation, or inquiry pending or, to the knowledge of the Company, threatened against or affecting the Company or any of its subsidiaries, at law or in equity, before or by any Governmental Authority, arbitral tribunal, or other body, that (a) challenges or seeks to prevent, enjoin, alter, or materially delay the consummation of the transactions contemplated by this Agreement or the other Transaction Documents, or (b) individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.
Section 3.12 — Insurance
The Company and its subsidiaries maintain, with financially sound and reputable insurance companies, insurance (including directors' and officers' liability insurance) in such amounts and covering such risks as are customary for companies engaged in similar businesses and owning similar properties. Without limiting the generality of the foregoing, the Company maintains a directors' and officers' liability insurance policy with Promontory Indemnity Insurance Co. (Bermuda), policy number PII-DO-2022-08847, with an aggregate coverage limit of $25,000,000. Such policy was arranged through Seaward & Beckett Insurance Brokers Ltd. (contact: Ian Beckett, 71 Fenchurch Street, London EC3M 4BS, United Kingdom) and is in full force and effect as of the date hereof. The Company has not received any notice of cancellation or termination with respect to any material insurance policy.
Section 3.13 — Tax Matters
The Company and each of its subsidiaries have duly and timely filed all material tax returns and reports required to be filed by them under applicable law (after giving effect to any valid extensions of time to file), and all such returns and reports are true, correct, and complete in all material respects. The Company and each of its subsidiaries have timely paid (or caused to be paid) all material taxes due and payable, whether or not shown on such returns. The Company's Greek Tax Identification Number (ΑΦΜ) is 998214763. No material tax liens have been imposed on any assets of the Company or any of its subsidiaries, and no material deficiency or assessment of taxes has been asserted or proposed against the Company or any of its subsidiaries by any taxing authority that has not been resolved or adequately reserved for.
Section 3.14 — Compliance with Laws
The Company and each of its subsidiaries are, and since January 1, 2020 have been, in material compliance with all applicable laws, statutes, regulations, rules, ordinances, codes, orders, and decrees of any Governmental Authority, including without limitation Greek maritime law, Greek corporate law, United States maritime regulations (including the Merchant Marine Act of 1920 (the Jones Act) as applicable to TAI's operations), European Union regulations, environmental laws and regulations (including those relating to ballast water management, emissions, and hazardous materials), and anti-money laundering and sanctions regulations. Neither the Company nor any of its subsidiaries has received any written notice from any Governmental Authority alleging any material violation of any such law or regulation that remains unresolved.
Section 3.15 — No Insolvency Proceedings
No insolvency, bankruptcy, restructuring, reorganization, receivership, administration, composition with creditors, or similar proceeding has been commenced, is pending, or, to the knowledge of the Company, is threatened against the Company or any of its subsidiaries under Greek Law 4738/2020 (Greek Debt Settlement and Insolvency Code), or under any other applicable law of any jurisdiction. Without limiting the foregoing, no petition for relief under Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code") or Chapter 15 thereof has been filed by or against TAI in the United States Bankruptcy Court for the Southern District of Texas, Houston Division, or in any other court. The Company has not taken any corporate action authorizing any such proceeding or filing.
ARTICLE IV — REPRESENTATIONS AND WARRANTIES OF THE SUBSCRIBER
KFO hereby represents and warrants to the Company as of the date hereof and as of the Closing Date (except where a representation or warranty is expressly stated to be made as of a specific date, in which case such representation or warranty is made only as of such specified date) as follows:
Section 4.1 — Organization and Good Standing
KFO is a société anonyme duly organized, validly existing, and in good standing under the laws of the Hellenic Republic, with registered offices at 42 Akti Miaouli, Piraeus 18538, Greece. KFO has the corporate power and authority to execute, deliver, and perform this Agreement and to consummate the transactions contemplated hereby.
Section 4.2 — Authorization
The execution, delivery, and performance of this Agreement by KFO, and the consummation by KFO of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of KFO, including approval by KFO's board of directors and, to the extent required, its shareholders. Each person executing this Agreement on behalf of KFO is duly authorized to do so. This Agreement has been duly executed and delivered by KFO and constitutes a legal, valid, and binding obligation of KFO, enforceable against KFO in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 4.3 — Financial Capacity
KFO has, and on the Closing Date will have, immediately available funds in an amount not less than the Equity Subscription Amount of €35,000,000, sufficient to consummate the subscription contemplated by this Agreement and to pay all costs and expenses required to be paid by KFO in connection herewith. KFO has not entered into any agreement, arrangement, or understanding (whether written or oral) that would, or would reasonably be expected to, impair, restrict, or otherwise adversely affect KFO's ability to fund the Equity Subscription Amount in full on the Closing Date. KFO's obligation to consummate the subscription is not subject to or conditioned upon the receipt of any financing from any third party.
Section 4.4 — Investment Intent
KFO is acquiring the New Shares for its own account, for investment purposes only, and not with a view to, or for offer or sale in connection with, any distribution or resale thereof in violation of any applicable securities laws, including the securities laws of the Hellenic Republic, the European Union, or the United States. KFO is a sophisticated investor with substantial experience in evaluating and investing in companies in the shipping and logistics industry, and KFO has conducted its own independent due diligence and investigation of the Company, its business, assets, liabilities, financial condition, and prospects. KFO acknowledges that it has had the opportunity to ask questions of, and receive answers from, the management of the Company regarding the Company and the transactions contemplated by this Agreement and the RSA, and has been provided with all information that KFO has requested.
Section 4.5 — No Conflicts
The execution, delivery, and performance of this Agreement by KFO, and the consummation by KFO of the transactions contemplated hereby, do not and will not: (a) violate, conflict with, or result in a breach of any provision of KFO's articles of association or any other organizational documents of KFO; (b) breach, violate, constitute a default under, or conflict with any material agreement, contract, or instrument to which KFO is a party or by which KFO or any of its properties or assets is bound; or (c) violate any applicable law, statute, regulation, rule, order, judgment, injunction, or decree of any Governmental Authority applicable to KFO.
Section 4.6 — Ownership of Existing Shares
KFO confirms that, as of the date hereof, the Kostandinos family (acting through KFO and directly) holds 80% of the outstanding equity of TSL, consisting of (a) 62% held by or for the account of Dimitrios Kostandinos and (b) 18% held by or for the account of Elena Kostandinos-Pavlou. KFO represents that the existing equity interests held by or for the account of the Kostandinos family are free and clear of all liens, pledges, encumbrances, security interests, options, and other adverse claims, except for any liens or restrictions arising under the Senior Secured Credit Agreement, the Forbearance Agreement, the RSA, or the Lock-Up Agreement.
Section 4.7 — Relationship Disclosure
KFO acknowledges and discloses that it is an affiliate and insider of the Company within the meaning of applicable Greek corporate law and securities regulations. Dimitrios Kostandinos serves simultaneously as Chairman of the Board of Directors of both TSL and KFO. Elena Kostandinos-Pavlou serves simultaneously as Vice Chairwoman of the Board of Directors of both TSL and KFO. KFO acknowledges that the transactions contemplated by this Agreement constitute related-party transactions and that all applicable requirements of Greek Law (including Article 99 et seq. of Greek Law 4548/2018) regarding related-party transactions have been or will be satisfied prior to the Closing Date.
Section 4.8 — No Brokers
Neither KFO nor any of its affiliates has engaged, retained, or agreed to compensate any broker, finder, investment banker, or other intermediary in connection with the transactions contemplated by this Agreement, other than in connection with the Company's engagement of Kensington Veltrian Partners LLC as financial advisor to the Company (the fees and expenses of which are Transaction Costs payable by the Company). No Person is entitled to any broker's fee, finder's fee, commission, or similar payment from KFO or any of its affiliates in connection with the transactions contemplated hereby.
ARTICLE V — COVENANTS
Section 5.1 — Pre-Closing Covenants of the Company
From the date hereof until the earlier of the Closing Date and the termination of this Agreement in accordance with Article VIII, the Company covenants and agrees as follows:
(a) Ordinary Course of Business. The Company shall, and shall cause each of its subsidiaries to, conduct its business in the ordinary course consistent with past practice and in compliance with the RSA and the forbearance arrangements then in effect, and shall use commercially reasonable efforts to preserve intact its business organization, relationships with customers, suppliers, and counterparties, and the services of its key employees and officers.
(b) No Additional Equity Issuances. The Company shall not issue, sell, pledge, or otherwise dispose of, or authorize the issuance, sale, pledge, or other disposition of, any shares, equity interests, options, warrants, or other rights to acquire shares or equity interests of the Company, other than (i) the New Shares to be issued to KFO pursuant to this Agreement and (ii) the equity interests to be issued to BMC in connection with the Mezzanine Exchange, without the prior written consent of KFO.
(c) Notice of Certain Events. The Company shall promptly (and in any event within three (3) Business Days) notify KFO in writing of (i) any event, development, or condition that has resulted in, or would reasonably be expected to result in, a Material Adverse Effect; (ii) any material breach of any representation or warranty of the Company set forth in Article III; (iii) the failure of any condition set forth in Section 6.1 or Section 6.2 that becomes known to the Company; or (iv) any notice of default, acceleration, or termination received by the Company under any material agreement.
(d) Regulatory Cooperation. The Company shall cooperate fully with KFO in obtaining any required regulatory approvals, consents, authorizations, filings, or registrations in connection with the issuance of the New Shares and the consummation of the transactions contemplated by this Agreement, including by promptly furnishing information, executing documents, and making filings as may be reasonably required.
(e) Maintenance of Insurance. The Company shall maintain in full force and effect all material insurance policies, including without limitation the directors' and officers' liability insurance policy with Promontory Indemnity Insurance Co. (policy number PII-DO-2022-08847), and shall not permit any material insurance policy to lapse, expire, or be cancelled without the prior written consent of KFO.
(f) RSA Compliance. The Company shall comply in all material respects with the milestones, deadlines, and other obligations set forth in the RSA and shall use commercially reasonable efforts to satisfy all conditions to the closing of the RSA transactions in a timely manner.
Section 5.2 — Pre-Closing Covenants of KFO
From the date hereof until the earlier of the Closing Date and the termination of this Agreement in accordance with Article VIII, KFO covenants and agrees as follows:
(a) Maintenance of Financial Capacity. KFO shall maintain immediately available funds in an amount not less than the Equity Subscription Amount of €35,000,000 and shall not enter into any agreement, arrangement, or transaction that would, or would reasonably be expected to, impair KFO's ability to fund the Equity Subscription Amount in full on the Closing Date.
(b) No Transfer or Encumbrance. KFO shall not, and shall cause the Kostandinos family members not to, transfer, sell, assign, pledge, hypothecate, encumber, or otherwise dispose of any existing equity holdings in the Company, or agree or commit to do any of the foregoing, prior to the Closing, without the prior written consent of the Company and Nordbank (as administrative agent).
(c) Cooperation. KFO shall cooperate with the Company and its advisors (including Calderwood & Harkness LLP and Vassiliou & Demetriou Law Offices) to satisfy the conditions to Closing set forth in Article VI, including by promptly executing and delivering all documents, instruments, and certificates reasonably requested by the Company or its advisors in connection therewith.
Section 5.3 — Post-Closing Covenants
From and after the Closing Date, the Parties covenant and agree as follows:
(a) Lock-Up. For a period of twelve (12) months following the Closing Date (the "Lock-Up Period"), KFO shall not, directly or indirectly, transfer, sell, assign, pledge, hypothecate, encumber, or otherwise dispose of any of the New Shares or any existing shares of the Company held by KFO or the Kostandinos family, or enter into any agreement or arrangement to do any of the foregoing, without the prior written consent of Nordbank (as administrative agent under the Senior Secured Credit Facility); provided, however, that the foregoing restriction shall not apply to transfers to members of the Kostandinos family or to entities controlled by members of the Kostandinos family, so long as the transferee agrees in writing to be bound by the terms of this Section 5.3(a) for the remainder of the Lock-Up Period.
(b) Use of Proceeds. The Company shall apply the proceeds of the Equity Subscription Amount in accordance with Section 2.3 and shall not use any portion of such proceeds for any purpose not permitted by Section 2.3.
(c) Vessel Dispositions. The Company shall complete the sale of six (6) older dry-bulk carriers (with an average age of approximately eighteen (18) years) within twelve (12) months of the closing of the RSA transactions, for estimated aggregate gross proceeds of approximately $72 million, with the net proceeds thereof to be applied to prepay Term Loan A under the Senior Secured Credit Facility, in accordance with the terms and requirements of the Side Letter Agreement re Vessel Disposition Undertaking, dated as of March 14, 2023, between the Company and Nordbank (as administrative agent). The vessels designated for sale are identified on Schedule D hereto.
(d) Registry and Filings. The Company shall maintain its registration with the Athens General Commercial Registry (Γ.Ε.ΜΗ.) and shall make all required post-issuance filings and registrations in connection with the issuance of the New Shares, including any filings with the Hellenic Capital Market Commission, within the time periods prescribed by applicable law.
Section 5.4 — Tax Covenants
(a) Tax Cooperation. The Company and KFO shall cooperate in good faith in determining the tax treatment of the subscription and issuance of the New Shares under all applicable tax laws, including Greek capital gains tax, Greek stamp duty (τέλος χαρτοσήμου), transfer tax, and any other taxes, duties, or levies that may be imposed on or in connection with the transactions contemplated by this Agreement. Each Party shall furnish to the other Party such information and documents as may reasonably be requested for tax compliance purposes.
(b) Tax Certificates. The Company shall provide KFO with such tax certificates, statements, and information as KFO may reasonably request from time to time in connection with KFO's Greek and international tax reporting obligations, including certificates of tax residency and withholding tax documentation.
(c) Cross-Border Tax Analysis. The Parties acknowledge that a cross-border tax analysis has been prepared by Sylvia Hartwell of Calderwood & Harkness LLP in connection with the RSA transactions, addressing, among other matters, the Greek tax law implications of the equity contribution by KFO to the Company. The Parties agree to take such positions on their respective tax returns as are consistent with the conclusions of such analysis, to the extent such positions are supportable under applicable law.
ARTICLE VI — CONDITIONS TO CLOSING
Section 6.1 — Conditions to the Obligations of Both Parties
The respective obligations of each Party to consummate the transactions contemplated by this Agreement are subject to the satisfaction or waiver (to the extent permitted by applicable law) of the following conditions as of the Closing Date:
(a) No Prohibition. No Governmental Authority shall have enacted, issued, promulgated, enforced, or entered any law, statute, regulation, rule, order, injunction, decree, judgment, or other governmental action (whether temporary, preliminary, or permanent) that is in effect and that prohibits, restrains, enjoins, or makes illegal the consummation of the transactions contemplated by this Agreement.
(b) Regulatory Approvals and Filings. All material consents, approvals, authorizations, and filings required under Greek Law or the laws of any other applicable jurisdiction in connection with the issuance of the New Shares and the consummation of the transactions contemplated by this Agreement shall have been duly obtained or made, and all applicable waiting periods shall have expired or been terminated.
(c) RSA in Full Force and Effect. The RSA shall remain in full force and effect and shall not have been terminated in accordance with its terms.
Section 6.2 — Conditions to the Obligations of KFO
The obligation of KFO to consummate the subscription and purchase of the New Shares is further subject to the satisfaction or waiver by KFO of the following conditions as of the Closing Date:
(a) Representations and Warranties. The representations and warranties of the Company set forth in Article III shall be true and correct in all material respects (or, in the case of representations and warranties qualified by materiality or Material Adverse Effect, true and correct in all respects) as of the date hereof and as of the Closing Date (except for representations and warranties that by their terms address matters only as of a specific date, which shall be true and correct in all material respects as of such specified date).
(b) Performance of Covenants. The Company shall have performed and complied with, in all material respects, all covenants and agreements required to be performed or complied with by the Company under this Agreement at or prior to the Closing Date.
(c) RSA Transactions. The following Transaction Documents shall have been duly executed and delivered by all parties thereto (or shall be executed and delivered simultaneously with the Closing):
(i) Amendment No. 1 to the Senior Secured Credit Agreement (dated as of May 15, 2023);
(ii) the Amended and Restated Intercreditor Agreement (dated as of May 15, 2023);
(iii) the New Second-Lien Note Purchase Agreement with BMC (dated as of May 18, 2023);
(iv) the New Second-Lien Notes Indenture (dated as of May 18, 2023);
(v) the Amended and Restated Intercompany Promissory Note from TAI to TSL (dated as of May 25, 2023), in the principal amount of $76.4 million, with the maturity date extended to December 2028 and the interest rate reduced from 5.0% to 2.0% per annum;
(vi) the Joinder Agreement, duly executed by all consenting senior secured lenders (comprising 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, and Caspian Asset Management Ltd., and Pelagos Institutional Credit Fund);
(vii) the Consent and Waiver Letter from Garrison Trust Company (dated as of March 20, 2023), consenting to the transactions contemplated by the RSA and waiving any defaults under the unsecured note indenture arising from the missed December 1, 2022 coupon payment (subject to cure at Closing);
(viii) the Lock-Up Agreement with Dralvecen Mezzanine Capital LLC (dated as of March 14, 2023), restricting BMC's ability to transfer its equity in the Company for a period specified therein; and
(ix) the Side Letter Agreement re Vessel Disposition Undertaking (dated as of March 14, 2023), setting forth the Company's obligation to dispose of six older dry-bulk carriers within the time period and on the terms specified therein;
(d) Officer's Certificate. The Company shall have delivered to KFO (i) an Officer's Certificate duly executed by Marcus Hale (President, TAI), and (ii) a certificate duly executed by Georgios Andreadis (Chief Executive Officer, TSL), each dated as of the Closing Date, confirming the satisfaction of the conditions set forth in this Section 6.2 and certifying that the representations and warranties of the Company set forth in Article III are true and correct in all material respects as of the Closing Date.
(e) Solvency Certificate. A Solvency Certificate shall have been delivered by Diana Restrepo (Vice President — Finance, TAI), dated as of the Closing Date, certifying that, immediately after giving effect to the consummation of the transactions contemplated by the RSA (including the equity subscription hereunder, the amendment of the Senior Secured Credit Facility, the Mezzanine Exchange, and the intercompany note amendment), TAI is solvent, is able to pay its debts as they become due, and has capital and assets sufficient to carry on its business.
(f) Legal Opinions. Legal opinio