1044-00006 · Hargrove, Delacroix & Stern LLP · Insurance & Lender

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CONFIDENTIAL

CALDERWOOD & HARKNESS LLP One Liberty Plaza, 50th Floor New York, NY 10006

Telephone: (212) 558-4000 Facsimile: (212) 558-3588 www.calderwoodharkness.com

November 22, 2024

Mr. Lukas Brandt Relationship Manager Meridian Capital Bank AG Ballindamm 40 20095 Hamburg, Germany

Re: Notice of Material Litigation Settlement Pursuant to Section 8.14 of the Credit Agreement dated April 1, 2019 — Thalassa Shipping & Logistics SA (Borrower); $340,000,000 Secured Credit Facility

C&H Matter No.: 1044-00006

Dear Mr. Brandt:

Calderwood & Harkness LLP writes on behalf of its client, Thalassa Shipping & Logistics SA, a Société Anonyme organized under the laws of the Hellenic Republic, with its registered headquarters at 42 Akti Miaouli, Piraeus 185 38, Greece (Greek Tax Identification Number (AFM): 998342671) ("TSL" or the "Borrower"). The purpose of this letter is to provide formal notice pursuant to Section 8.14 of that certain Credit Agreement dated as of April 1, 2019 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), by and between Thalassa Shipping & Logistics SA, as Borrower, and Meridian Capital Bank AG, as Lender (the "Lender"). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.

As you are aware, Section 8.14 of the Credit Agreement requires the Borrower to notify the Lender in writing, promptly and in any event within ten (10) business days, of any material litigation settlement involving the Borrower or any of its subsidiaries in an aggregate amount exceeding Five Million Dollars ($5,000,000). The settlement described herein has an aggregate value of Seven Million Eight Hundred Fifty Thousand Dollars ($7,850,000), which exceeds the $5,000,000 notification threshold set forth in Section 8.14. Accordingly, TSL hereby provides this notice and the accompanying information for Meridian's records.

The details of the underlying litigation, the procedural history, the settlement terms, and the anticipated impact on the Credit Agreement and the credit facility are set forth in the sections that follow.

1. Background of the Litigation

The litigation that is the subject of this notice was captioned Northwind Maritime Corporation v. Thalassa Shipping & Logistics SA and Aegean Fortuna Shipholding Ltd., Index No. 655421/2023, and was pending before the Supreme Court of the State of New York, New York County, Commercial Division (Part 49), assigned to the Honorable Lorraine K. Chen, J.S.C.

The Plaintiff. Northwind Maritime Corporation ("Northwind") is a corporation duly incorporated and existing under the laws of the Republic of the marshall Islands, with its principal office located at 1700 Harbor Gateway, Suite 500, Stamford, Connecticut 06902. Northwind is engaged in the business of chartering and operating dry bulk vessels on a global basis.

The Defendants. The named defendants were (i) Thalassa Shipping & Logistics SA, and (ii) Aegean Fortuna Shipholding Ltd. ("Aegean Fortuna Shipholding"), a wholly owned subsidiary of TSL incorporated in the Republic of Liberia (Liberian Registration No. LR-C-20167845). Aegean Fortuna Shipholding is the registered owner of the vessel at issue in the litigation.

Nature of the Claims. Northwind's claims arose from an alleged breach of a thirty-six (36) month time charter-party in the New York Produce Exchange (NYPE) 2015 form, as amended (Reference No. NW-TSL-CP-2020-1203), executed on December 3, 2020 (the "Charter-Party"), for the vessel M/V Aegean Fortuna (IMO No. 9847231, Liberian flag, Supramax dry bulk carrier, 58,200 deadweight tonnage) (the "Vessel"). The Charter-Party provided for a charter commencement date of January 15, 2021, and a charter expiration date of January 14, 2024. The daily hire rate under the Charter-Party was Fourteen Thousand Seven Hundred Fifty Dollars ($14,750) per day, yielding a total charter value of approximately Sixteen Million One Hundred Sixty-Six Thousand Dollars ($16,166,000) over the full term.

Specifically, Northwind alleged that TSL and Aegean Fortuna Shipholding failed to maintain the seaworthiness of the Vessel in accordance with the maintenance and condition obligations set forth in the Charter-Party and applicable maritime law. Northwind's complaint identified three separate mechanical incidents that occurred during the charter period — involving, among other things, main engine turbocharger failures and auxiliary boiler malfunctions — which collectively resulted in a total of sixty-eight (68) off-hire days during which the Vessel was unable to perform its trading obligations. Northwind further alleged an unauthorized route deviation in connection with a voyage to and from the port of Maputo, Mozambique, in September 2022, asserting that the deviation constituted a breach of the approved trading limits set forth in Rider Clause 14 of the Charter-Party.

Amount Claimed. The total amount claimed by Northwind in the litigation was Eighteen Million Three Hundred Thousand Dollars ($18,300,000). This figure comprised the aggregate of off-hire deductions, liquidated damages sought under Clause 28 of the Charter-Party, substitute charter costs incurred by Northwind during periods when the Vessel was off-hire, alleged cargo damage arising from the mechanical incidents, demurrage claims asserted by Northwind's sub-charterers, third-party shipper claims for which Northwind sought indemnification, and Northwind's legal fees and costs.

Filing and Engagement of Counsel. The complaint was filed by Northwind on October 2, 2023. Calderwood & Harkness LLP was engaged by TSL to serve as lead litigation counsel on October 16, 2023, and thereafter entered an appearance on behalf of both defendants. Northwind was represented throughout the litigation by Hargrove, Delacroix & Stern LLP.

2. Procedural History Summary

Following the filing of Northwind's complaint, the litigation progressed through the following principal procedural stages:

Answer and Counterclaim. On November 17, 2023, TSL and Aegean Fortuna Shipholding, through Calderwood & Harkness LLP, filed their joint Answer and Affirmative Defenses, together with a Counterclaim on behalf of TSL. TSL's Counterclaim sought recovery of One Million Six Hundred Twenty Thousand Dollars ($1,620,000) representing unpaid charter hire for approximately one hundred ten (110) days during the period from October 1, 2022 through December 31, 2022, which hire Northwind had unilaterally withheld. TSL asserted that Northwind's withholding of hire was unjustified and constituted a breach of the Charter-Party.

Motion to Dismiss. On December 15, 2023, defendants filed a Motion to Dismiss Counts III and V of the complaint pursuant to CPLR § 3211(a)(7). Count III alleged tortious interference with Northwind's sub-charter agreements, and Count V sought a declaration of the defendants' joint and several liability for consequential damages. By Decision and Order dated March 8, 2024, Justice Chen granted the motion in part and denied it in part. Count V was dismissed in its entirety on the grounds that the Charter-Party contained a valid consequential damages limitation clause and that Northwind had not alleged sufficient facts to invoke the narrow exception for willful misconduct. Count III was narrowed to exclude claims related to sub-charters that post-dated the alleged mechanical incidents, thereby substantially reducing Northwind's potential damages exposure.

discovery. Fact discovery was conducted from January 2024 through August 2024, and included extensive document productions by both parties, written interrogatories, and requests for admission. The parties conducted depositions of, among others, the following key witnesses: (i) Alexandros Stavridis, Chairman and Chief Executive Officer of TSL; (ii) Captain Nikolaos Giannopoulos, the Master of the M/V Aegean Fortuna during the relevant charter period; and (iii) Petros Vlahos, Chief Engineer of the M/V Aegean Fortuna. Northwind deposed additional TSL personnel including representatives from its technical management and operations departments.

Expert Reports. Expert reports were exchanged by both parties during the period from August through September 2024. TSL retained a marine engineering expert and a shipping market economics expert to address, among other issues, the mechanical condition and seaworthiness of the Vessel, the reasonableness of the maintenance program, and the mitigation of damages. Northwind's experts addressed similar topics, including the commercial losses attributable to the off-hire periods and the alleged route deviation.

Motion for Partial Summary Judgment. On September 20, 2024, TSL filed a Motion for Partial Summary Judgment seeking judgment as a matter of law on two issues: (a) the proper interpretation of the liquidated damages cap set forth in Clause 28 of the Charter-Party, which TSL contended limited Northwind's recovery to a maximum of one hundred twenty (120) days of daily hire; and (b) dismissal of the route deviation claim on the grounds that the Maputo voyage was within the geographic scope of the Charter-Party trading limits when properly construed. This motion was fully briefed and pending before Justice Chen at the time the settlement was reached.

Mediation. Pursuant to a court order entered by Justice Chen, the parties participated in a two-day mediation session on October 28 and 29, 2024. The mediation was conducted before the Honorable Gerald K. Fitzpatrick (Ret.), serving as mediator at Bayside Dispute Resolution Services LLC. The mediation proved successful in that the parties reached a settlement in principle, as described in Section 3 below.

3. Settlement Terms

A settlement in principle was reached on October 29, 2024, at the conclusion of the second day of the court-ordered mediation. The terms of the settlement were memorialized in a mediator's term sheet signed by counsel for both parties on October 29, 2024. Thereafter, the parties negotiated and executed a definitive Settlement Agreement and Mutual General Release (the "Settlement Agreement"), which was fully executed by all parties on November 20, 2024. The material terms of the Settlement Agreement are summarized below.

Settlement Amount. The total aggregate settlement amount is Seven Million Eight Hundred Fifty Thousand Dollars ($7,850,000) (the "Settlement Amount"), payable by TSL and Aegean Fortuna Shipholding to Northwind in three installments, as follows:

(a) Payment 1: Four Million Dollars ($4,000,000), due and payable within thirty (30) days of the Effective Date of the Settlement Agreement;

(b) Payment 2: Two Million Dollars ($2,000,000), due and payable within ninety (90) days of the Effective Date of the Settlement Agreement; and

(c) Payment 3: One Million Eight Hundred Fifty Thousand Dollars ($1,850,000), due and payable within one hundred fifty (150) days of the Effective Date of the Settlement Agreement.

The "Effective Date" of the Settlement Agreement is defined therein as November 20, 2024, being the date of full execution by all parties.

Escrow Arrangements. All settlement payments are to be deposited into an escrow account established with Atlantic Fiduciary Trust Company (60 Wall Street, Suite 2800, New York, NY 10005), Escrow Account No. ESC-2024-NYK-08831 (the "Escrow Account"). Funds deposited into the Escrow Account shall be released to Northwind upon joint written instruction of counsel for both parties, in accordance with the terms of a separate escrow agreement entered into between the parties and Atlantic Fiduciary Trust Company.

Funding Sources. The Settlement Amount will be funded from the following sources:

(a) TSL Corporate Funds: Five Million Three Hundred Fifty Thousand Dollars ($5,350,000), to be funded from TSL's operating cash flow and available corporate reserves; and

(b) P&I Club Contribution: Two Million Five Hundred Thousand Dollars ($2,500,000), contributed by the Oceanus Mutual Protection & Indemnity Club (Bermuda) ("Oceanus") under Policy No. OCE-P&I-2020-TSL-0047. Board approval for this contribution was received from Oceanus on November 22, 2024.

Mutual General Release. The Settlement Agreement includes a mutual general release of all claims, counterclaims, cross-claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, and demands whatsoever, in law, admiralty, or equity, arising out of or related to the Charter-Party and the M/V Aegean Fortuna, including, without limitation, TSL's Counterclaim for One Million Six Hundred Twenty Thousand Dollars ($1,620,000) in unpaid hire. Accordingly, by entering into the Settlement Agreement, TSL has released and waived its right to recover on its Counterclaim.

Net Economic Cost to TSL. Taking into account both the aggregate Settlement Amount payable to Northwind and the waiver of TSL's Counterclaim, the net economic cost to TSL of the settlement is Six Million Two Hundred Thirty Thousand Dollars ($6,230,000), calculated as the aggregate settlement payment of $7,850,000, less the waived counterclaim of $1,620,000.

No Admission of Liability. The Settlement Agreement expressly provides that it does not constitute, and shall not be construed as, an admission of liability, fault, or wrongdoing by any party to the litigation.

Confidentiality. The terms of the Settlement Agreement are subject to strict confidentiality provisions. Permitted disclosures are limited to (i) the parties' respective insurers, (ii) lenders, (iii) auditors and accountants, (iv) tax advisors, (v) officers, directors, and senior management on a need-to-know basis, and (vi) disclosures required by applicable law, regulation, or court order. TSL confirms that this disclosure to Meridian Capital Bank AG falls squarely within the permitted-disclosure carve-out for lenders set forth in Section 12.2(b) of the Settlement Agreement.

4. Consent Judgment and Default Provisions

The Settlement Agreement contains certain enforcement mechanisms and default provisions, summarized as follows:

Pursuant to Section 7.3 of the Settlement Agreement, in the event that TSL defaults on any installment payment and fails to cure such default within ten (10) business days following written notice from Northwind, Northwind shall have the right to enter a consent judgment against TSL for the full unpaid balance of the Settlement Amount, together with interest accruing at the rate of nine percent (9%) per annum (the statutory rate applicable to judgments under Section 5004 of the New York Civil Practice Law and Rules) from the date of default until the date of payment.

The Supreme Court of the State of New York, New York County, has retained jurisdiction over the matter for a period of one hundred eighty (180) days following the Effective Date of the Settlement Agreement, for the sole purpose of enforcing the settlement terms, including the entry of any consent judgment in the event of a payment default.

In connection with the settlement, all pending motions — including TSL's Motion for Partial Summary Judgment filed on September 20, 2024 — have been withdrawn with prejudice. A Stipulation of discontinuance with Prejudice, pursuant to CPLR § 3217(a)(2), will be filed with the Court within ten (10) business days following TSL's remittance of the final settlement payment and the release of such payment from the Escrow Account to Northwind.

5. Impact on the Credit Facility

TSL has asked us to convey the following information to Meridian regarding the impact, or lack thereof, of the settlement on the $340,000,000 secured credit facility provided under the Credit Agreement:

Funding Source. TSL confirms that the Five Million Three Hundred Fifty Thousand Dollars ($5,350,000) corporate contribution to the Settlement Amount will be funded entirely from TSL's operating cash flow and available corporate reserves. This amount does not require, and TSL does not intend to make, any draw on the $340,000,000 Meridian credit facility. The Two Million Five Hundred Thousand Dollars ($2,500,000) P&I Club contribution is funded separately by Oceanus Mutual Protection & Indemnity Club and does not impact the credit facility in any respect.

Continued Covenant Compliance. TSL confirms its continued compliance with all financial covenants set forth in the Credit Agreement, including, without limitation, the minimum liquidity covenant (Section 9.1), the maximum leverage ratio covenant (Section 9.2), the minimum interest coverage ratio covenant (Section 9.3), and the minimum fleet value maintenance covenant (Section 9.4). TSL's most recent compliance certificate, delivered to Meridian on October 15, 2024 in connection with the third-quarter reporting period, reflected full compliance with all such covenants, and TSL expects that the settlement will not adversely affect its ability to maintain compliance in future reporting periods.

Materiality Context. TSL notes that, while the Settlement Amount is sufficiently material to trigger the notification requirement under Section 8.14 of the Credit Agreement, the net economic cost of the settlement represents a modest proportion of TSL's overall financial profile. Specifically:

(a) The aggregate Settlement Amount of $7,850,000 represents approximately 1.3% of TSL's annual consolidated revenue, which was approximately Six Hundred Twelve Million Dollars ($612,000,000) for the fiscal year ended December 31, 2022; and

(b) The aggregate Settlement Amount represents approximately 5.5% of TSL's consolidated EBITDA, which was approximately Ninety-Eight Million Dollars ($98,000,000) for the fiscal year ended December 31, 2022, after normalizing adjustments.

TSL anticipates that its fiscal year 2023 and 2024 results will reflect revenue and EBITDA figures comparable to or exceeding the fiscal year 2022 benchmarks cited above.

No Impact on Vessel Liens or Collateral. No liens, encumbrances, security interests, mortgages, or other charges on any TSL vessel — including those vessels that form part of the collateral package securing the Meridian credit facility — are created, modified, or otherwise affected by the Settlement Agreement. The M/V Aegean Fortuna itself is not among the vessels mortgaged to Meridian under the Credit Agreement.

Continued Fleet Operations. TSL's fleet of approximately thirty-four (34) vessels continues to operate in the ordinary course of business, and the settlement of the Northwind litigation does not affect the trading, deployment, or operational status of any vessel in the fleet.

6. Confirmation of No Additional Covenants Implicated

In addition to the foregoing, TSL has reviewed the relevant covenants, representations, and default provisions of the Credit Agreement and hereby confirms the following:

(a) The settlement does not constitute, and the events underlying the litigation do not give rise to, a "Material Adverse Change" as that term is defined in Section 1.1 of the Credit Agreement. TSL's business, operations, assets, condition (financial or otherwise), and prospects remain substantially unchanged as a result of the settlement.

(b) No "Event of Default" or "Potential Event of Default" (as those terms are defined in Sections 1.1 and 10.1 of the Credit Agreement, respectively) has occurred or is continuing as a result of the settlement or the payment of the Settlement Amount.

(c) The settlement fully and finally resolves all litigation, claims, and disputes related to the Charter-Party and the M/V Aegean Fortuna. No further claims, counterclaims, or cross-claims remain outstanding between TSL (or any of its subsidiaries) and Northwind Maritime Corporation in connection with the matters that were the subject of the litigation.

7. Enclosures

For Meridian's records, we enclose herewith a copy of the fully executed Settlement Agreement and Mutual General Release (Execution Version, dated November 20, 2024). We respectfully note that this document is provided to Meridian subject to the confidentiality obligations set forth in Section 12 of the Settlement Agreement, and we would ask that Meridian treat the enclosed document, and the information contained therein, in accordance with the confidentiality provisions of the Credit Agreement and the Settlement Agreement.

TSL stands ready to provide any additional information, documentation, or certifications that Meridian may reasonably request in connection with this notification, including but not limited to updated financial statements, compliance certificates, or supplemental legal memoranda addressing any specific covenant or provision of the Credit Agreement.

8. Contact Information and Further Inquiries

Should you have any questions regarding this notice, or should you wish to request additional information or documentation in connection with the matters described herein, please do not hesitate to contact any of the following persons:

Douglas Carmichael Partner Calderwood & Harkness LLP One Liberty Plaza, 50th Floor New York, NY 10006 Telephone: (212) 558-4127 Facsimile: (212) 558-3591

Email: d.carmichael@calderwoodharkness.com

Markos Theodorakis General Counsel Thalassa Shipping & Logistics SA 42 Akti Miaouli Piraeus 185 38, Greece Telephone: +30 210 429 7300

Email: m.theodorakis@thalassasl.com

Elena Papadimitriou Chief Financial Officer Thalassa Shipping & Logistics SA 42 Akti Miaouli Piraeus 185 38, Greece Telephone: +30 210 429 7400

Email: e.papadimitriou@thalassasl.com

We trust that the foregoing provides Meridian with the information required under Section 8.14 of the Credit Agreement. We appreciate Meridian's continued support of TSL and remain available to address any further inquiries at your convenience.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Douglas Carmichael Partner

On behalf of Thalassa Shipping & Logistics SA

cc:

Markos Theodorakis, General Counsel, Thalassa Shipping & Logistics SA Elena Papadimitriou, Chief Financial Officer, Thalassa Shipping & Logistics SA Alexandros Stavridis, Chairman and Chief Executive Officer, Thalassa Shipping & Logistics SA Francesca Morano, Partner, Calderwood & Harkness LLP

Enclosure:

Settlement Agreement and Mutual General Release (Execution Version, dated November 20, 2024)

CONFIDENTIAL
CALDERWOOD & HARKNESS LLP One Liberty Plaza, 50th Floor New York, NY 10006
Telephone: (212) 558-4000 Facsimile: (212) 558-3588 www.calderwoodharkness.com
November 22, 2024
Mr. Lukas Brandt Relationship Manager Meridian Capital Bank AG Ballindamm 40 20095 Hamburg, Germany
Re: Notice of Material Litigation Settlement Pursuant to Section 8.14 of the Credit Agreement dated April 1, 2019 — Thalassa Shipping & Logistics SA (Borrower); $340,000,000 Secured Credit Facility
C&H Matter No.: 1044-00006
Dear Mr. Brandt:
Calderwood & Harkness LLP writes on behalf of its client, Thalassa Shipping & Logistics SA, a Société Anonyme organized under the laws of the Hellenic Republic, with its registered headquarters at 42 Akti Miaouli, Piraeus 185 38, Greece (Greek Tax Identification Number (AFM): 998342671) ("TSL" or the "Borrower"). The purpose of this letter is to provide formal notice pursuant to Section 8.14 of that certain Credit Agreement dated as of April 1, 2019 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), by and between Thalassa Shipping & Logistics SA, as Borrower, and Meridian Capital Bank AG, as Lender (the "Lender"). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.
As you are aware, Section 8.14 of the Credit Agreement requires the Borrower to notify the Lender in writing, promptly and in any event within ten (10) business days, of any material litigation settlement involving the Borrower or any of its subsidiaries in an aggregate amount exceeding Five Million Dollars ($5,000,000). The settlement described herein has an aggregate value of Seven Million Eight Hundred Fifty Thousand Dollars ($7,850,000), which exceeds the $5,000,000 notification threshold set forth in Section 8.14. Accordingly, TSL hereby provides this notice and the accompanying information for Meridian's records.
The details of the underlying litigation, the procedural history, the settlement terms, and the anticipated impact on the Credit Agreement and the credit facility are set forth in the sections that follow.
1. Background of the Litigation
The litigation that is the subject of this notice was captioned Northwind Maritime Corporation v. Thalassa Shipping & Logistics SA and Aegean Fortuna Shipholding Ltd., Index No. 655421/2023, and was pending before the Supreme Court of the State of New York, New York County, Commercial Division (Part 49), assigned to the Honorable Lorraine K. Chen, J.S.C.
The Plaintiff. Northwind Maritime Corporation ("Northwind") is a corporation duly incorporated and existing under the laws of the Republic of the marshall Islands, with its principal office located at 1700 Harbor Gateway, Suite 500, Stamford, Connecticut 06902. Northwind is engaged in the business of chartering and operating dry bulk vessels on a global basis.
The Defendants. The named defendants were (i) Thalassa Shipping & Logistics SA, and (ii) Aegean Fortuna Shipholding Ltd. ("Aegean Fortuna Shipholding"), a wholly owned subsidiary of TSL incorporated in the Republic of Liberia (Liberian Registration No. LR-C-20167845). Aegean Fortuna Shipholding is the registered owner of the vessel at issue in the litigation.
Nature of the Claims. Northwind's claims arose from an alleged breach of a thirty-six (36) month time charter-party in the New York Produce Exchange (NYPE) 2015 form, as amended (Reference No. NW-TSL-CP-2020-1203), executed on December 3, 2020 (the "Charter-Party"), for the vessel M/V Aegean Fortuna (IMO No. 9847231, Liberian flag, Supramax dry bulk carrier, 58,200 deadweight tonnage) (the "Vessel"). The Charter-Party provided for a charter commencement date of January 15, 2021, and a charter expiration date of January 14, 2024. The daily hire rate under the Charter-Party was Fourteen Thousand Seven Hundred Fifty Dollars ($14,750) per day, yielding a total charter value of approximately Sixteen Million One Hundred Sixty-Six Thousand Dollars ($16,166,000) over the full term.
Specifically, Northwind alleged that TSL and Aegean Fortuna Shipholding failed to maintain the seaworthiness of the Vessel in accordance with the maintenance and condition obligations set forth in the Charter-Party and applicable maritime law. Northwind's complaint identified three separate mechanical incidents that occurred during the charter period — involving, among other things, main engine turbocharger failures and auxiliary boiler malfunctions — which collectively resulted in a total of sixty-eight (68) off-hire days during which the Vessel was unable to perform its trading obligations. Northwind further alleged an unauthorized route deviation in connection with a voyage to and from the port of Maputo, Mozambique, in September 2022, asserting that the deviation constituted a breach of the approved trading limits set forth in Rider Clause 14 of the Charter-Party.
Amount Claimed. The total amount claimed by Northwind in the litigation was Eighteen Million Three Hundred Thousand Dollars ($18,300,000). This figure comprised the aggregate of off-hire deductions, liquidated damages sought under Clause 28 of the Charter-Party, substitute charter costs incurred by Northwind during periods when the Vessel was off-hire, alleged cargo damage arising from the mechanical incidents, demurrage claims asserted by Northwind's sub-charterers, third-party shipper claims for which Northwind sought indemnification, and Northwind's legal fees and costs.
Filing and Engagement of Counsel. The complaint was filed by Northwind on October 2, 2023. Calderwood & Harkness LLP was engaged by TSL to serve as lead litigation counsel on October 16, 2023, and thereafter entered an appearance on behalf of both defendants. Northwind was represented throughout the litigation by Hargrove, Delacroix & Stern LLP.
2. Procedural History Summary
Following the filing of Northwind's complaint, the litigation progressed through the following principal procedural stages:
Answer and Counterclaim. On November 17, 2023, TSL and Aegean Fortuna Shipholding, through Calderwood & Harkness LLP, filed their joint Answer and Affirmative Defenses, together with a Counterclaim on behalf of TSL. TSL's Counterclaim sought recovery of One Million Six Hundred Twenty Thousand Dollars ($1,620,000) representing unpaid charter hire for approximately one hundred ten (110) days during the period from October 1, 2022 through December 31, 2022, which hire Northwind had unilaterally withheld. TSL asserted that Northwind's withholding of hire was unjustified and constituted a breach of the Charter-Party.
Motion to Dismiss. On December 15, 2023, defendants filed a Motion to Dismiss Counts III and V of the complaint pursuant to CPLR § 3211(a)(7). Count III alleged tortious interference with Northwind's sub-charter agreements, and Count V sought a declaration of the defendants' joint and several liability for consequential damages. By Decision and Order dated March 8, 2024, Justice Chen granted the motion in part and denied it in part. Count V was dismissed in its entirety on the grounds that the Charter-Party contained a valid consequential damages limitation clause and that Northwind had not alleged sufficient facts to invoke the narrow exception for willful misconduct. Count III was narrowed to exclude claims related to sub-charters that post-dated the alleged mechanical incidents, thereby substantially reducing Northwind's potential damages exposure.
discovery. Fact discovery was conducted from January 2024 through August 2024, and included extensive document productions by both parties, written interrogatories, and requests for admission. The parties conducted depositions of, among others, the following key witnesses: (i) Alexandros Stavridis, Chairman and Chief Executive Officer of TSL; (ii) Captain Nikolaos Giannopoulos, the Master of the M/V Aegean Fortuna during the relevant charter period; and (iii) Petros Vlahos, Chief Engineer of the M/V Aegean Fortuna. Northwind deposed additional TSL personnel including representatives from its technical management and operations departments.
Expert Reports. Expert reports were exchanged by both parties during the period from August through September 2024. TSL retained a marine engineering expert and a shipping market economics expert to address, among other issues, the mechanical condition and seaworthiness of the Vessel, the reasonableness of the maintenance program, and the mitigation of damages. Northwind's experts addressed similar topics, including the commercial losses attributable to the off-hire periods and the alleged route deviation.
Motion for Partial Summary Judgment. On September 20, 2024, TSL filed a Motion for Partial Summary Judgment seeking judgment as a matter of law on two issues: (a) the proper interpretation of the liquidated damages cap set forth in Clause 28 of the Charter-Party, which TSL contended limited Northwind's recovery to a maximum of one hundred twenty (120) days of daily hire; and (b) dismissal of the route deviation claim on the grounds that the Maputo voyage was within the geographic scope of the Charter-Party trading limits when properly construed. This motion was fully briefed and pending before Justice Chen at the time the settlement was reached.
Mediation. Pursuant to a court order entered by Justice Chen, the parties participated in a two-day mediation session on October 28 and 29, 2024. The mediation was conducted before the Honorable Gerald K. Fitzpatrick (Ret.), serving as mediator at Bayside Dispute Resolution Services LLC. The mediation proved successful in that the parties reached a settlement in principle, as described in Section 3 below.
3. Settlement Terms
A settlement in principle was reached on October 29, 2024, at the conclusion of the second day of the court-ordered mediation. The terms of the settlement were memorialized in a mediator's term sheet signed by counsel for both parties on October 29, 2024. Thereafter, the parties negotiated and executed a definitive Settlement Agreement and Mutual General Release (the "Settlement Agreement"), which was fully executed by all parties on November 20, 2024. The material terms of the Settlement Agreement are summarized below.
Settlement Amount. The total aggregate settlement amount is Seven Million Eight Hundred Fifty Thousand Dollars ($7,850,000) (the "Settlement Amount"), payable by TSL and Aegean Fortuna Shipholding to Northwind in three installments, as follows:
(a) Payment 1: Four Million Dollars ($4,000,000), due and payable within thirty (30) days of the Effective Date of the Settlement Agreement;
(b) Payment 2: Two Million Dollars ($2,000,000), due and payable within ninety (90) days of the Effective Date of the Settlement Agreement; and
(c) Payment 3: One Million Eight Hundred Fifty Thousand Dollars ($1,850,000), due and payable within one hundred fifty (150) days of the Effective Date of the Settlement Agreement.
The "Effective Date" of the Settlement Agreement is defined therein as November 20, 2024, being the date of full execution by all parties.
Escrow Arrangements. All settlement payments are to be deposited into an escrow account established with Atlantic Fiduciary Trust Company (60 Wall Street, Suite 2800, New York, NY 10005), Escrow Account No. ESC-2024-NYK-08831 (the "Escrow Account"). Funds deposited into the Escrow Account shall be released to Northwind upon joint written instruction of counsel for both parties, in accordance with the terms of a separate escrow agreement entered into between the parties and Atlantic Fiduciary Trust Company.
Funding Sources. The Settlement Amount will be funded from the following sources:
(a) TSL Corporate Funds: Five Million Three Hundred Fifty Thousand Dollars ($5,350,000), to be funded from TSL's operating cash flow and available corporate reserves; and
(b) P&I Club Contribution: Two Million Five Hundred Thousand Dollars ($2,500,000), contributed by the Oceanus Mutual Protection & Indemnity Club (Bermuda) ("Oceanus") under Policy No. OCE-P&I-2020-TSL-0047. Board approval for this contribution was received from Oceanus on November 22, 2024.
Mutual General Release. The Settlement Agreement includes a mutual general release of all claims, counterclaims, cross-claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, and demands whatsoever, in law, admiralty, or equity, arising out of or related to the Charter-Party and the M/V Aegean Fortuna, including, without limitation, TSL's Counterclaim for One Million Six Hundred Twenty Thousand Dollars ($1,620,000) in unpaid hire. Accordingly, by entering into the Settlement Agreement, TSL has released and waived its right to recover on its Counterclaim.
Net Economic Cost to TSL. Taking into account both the aggregate Settlement Amount payable to Northwind and the waiver of TSL's Counterclaim, the net economic cost to TSL of the settlement is Six Million Two Hundred Thirty Thousand Dollars ($6,230,000), calculated as the aggregate settlement payment of $7,850,000, less the waived counterclaim of $1,620,000.
No Admission of Liability. The Settlement Agreement expressly provides that it does not constitute, and shall not be construed as, an admission of liability, fault, or wrongdoing by any party to the litigation.
Confidentiality. The terms of the Settlement Agreement are subject to strict confidentiality provisions. Permitted disclosures are limited to (i) the parties' respective insurers, (ii) lenders, (iii) auditors and accountants, (iv) tax advisors, (v) officers, directors, and senior management on a need-to-know basis, and (vi) disclosures required by applicable law, regulation, or court order. TSL confirms that this disclosure to Meridian Capital Bank AG falls squarely within the permitted-disclosure carve-out for lenders set forth in Section 12.2(b) of the Settlement Agreement.
4. Consent Judgment and Default Provisions
The Settlement Agreement contains certain enforcement mechanisms and default provisions, summarized as follows:
Pursuant to Section 7.3 of the Settlement Agreement, in the event that TSL defaults on any installment payment and fails to cure such default within ten (10) business days following written notice from Northwind, Northwind shall have the right to enter a consent judgment against TSL for the full unpaid balance of the Settlement Amount, together with interest accruing at the rate of nine percent (9%) per annum (the statutory rate applicable to judgments under Section 5004 of the New York Civil Practice Law and Rules) from the date of default until the date of payment.
The Supreme Court of the State of New York, New York County, has retained jurisdiction over the matter for a period of one hundred eighty (180) days following the Effective Date of the Settlement Agreement, for the sole purpose of enforcing the settlement terms, including the entry of any consent judgment in the event of a payment default.
In connection with the settlement, all pending motions — including TSL's Motion for Partial Summary Judgment filed on September 20, 2024 — have been withdrawn with prejudice. A Stipulation of discontinuance with Prejudice, pursuant to CPLR § 3217(a)(2), will be filed with the Court within ten (10) business days following TSL's remittance of the final settlement payment and the release of such payment from the Escrow Account to Northwind.
5. Impact on the Credit Facility
TSL has asked us to convey the following information to Meridian regarding the impact, or lack thereof, of the settlement on the $340,000,000 secured credit facility provided under the Credit Agreement:
Funding Source. TSL confirms that the Five Million Three Hundred Fifty Thousand Dollars ($5,350,000) corporate contribution to the Settlement Amount will be funded entirely from TSL's operating cash flow and available corporate reserves. This amount does not require, and TSL does not intend to make, any draw on the $340,000,000 Meridian credit facility. The Two Million Five Hundred Thousand Dollars ($2,500,000) P&I Club contribution is funded separately by Oceanus Mutual Protection & Indemnity Club and does not impact the credit facility in any respect.
Continued Covenant Compliance. TSL confirms its continued compliance with all financial covenants set forth in the Credit Agreement, including, without limitation, the minimum liquidity covenant (Section 9.1), the maximum leverage ratio covenant (Section 9.2), the minimum interest coverage ratio covenant (Section 9.3), and the minimum fleet value maintenance covenant (Section 9.4). TSL's most recent compliance certificate, delivered to Meridian on October 15, 2024 in connection with the third-quarter reporting period, reflected full compliance with all such covenants, and TSL expects that the settlement will not adversely affect its ability to maintain compliance in future reporting periods.
Materiality Context. TSL notes that, while the Settlement Amount is sufficiently material to trigger the notification requirement under Section 8.14 of the Credit Agreement, the net economic cost of the settlement represents a modest proportion of TSL's overall financial profile. Specifically:
(a) The aggregate Settlement Amount of $7,850,000 represents approximately 1.3% of TSL's annual consolidated revenue, which was approximately Six Hundred Twelve Million Dollars ($612,000,000) for the fiscal year ended December 31, 2022; and
(b) The aggregate Settlement Amount represents approximately 5.5% of TSL's consolidated EBITDA, which was approximately Ninety-Eight Million Dollars ($98,000,000) for the fiscal year ended December 31, 2022, after normalizing adjustments.
TSL anticipates that its fiscal year 2023 and 2024 results will reflect revenue and EBITDA figures comparable to or exceeding the fiscal year 2022 benchmarks cited above.
No Impact on Vessel Liens or Collateral. No liens, encumbrances, security interests, mortgages, or other charges on any TSL vessel — including those vessels that form part of the collateral package securing the Meridian credit facility — are created, modified, or otherwise affected by the Settlement Agreement. The M/V Aegean Fortuna itself is not among the vessels mortgaged to Meridian under the Credit Agreement.
Continued Fleet Operations. TSL's fleet of approximately thirty-four (34) vessels continues to operate in the ordinary course of business, and the settlement of the Northwind litigation does not affect the trading, deployment, or operational status of any vessel in the fleet.
6. Confirmation of No Additional Covenants Implicated
In addition to the foregoing, TSL has reviewed the relevant covenants, representations, and default provisions of the Credit Agreement and hereby confirms the following:
(a) The settlement does not constitute, and the events underlying the litigation do not give rise to, a "Material Adverse Change" as that term is defined in Section 1.1 of the Credit Agreement. TSL's business, operations, assets, condition (financial or otherwise), and prospects remain substantially unchanged as a result of the settlement.
(b) No "Event of Default" or "Potential Event of Default" (as those terms are defined in Sections 1.1 and 10.1 of the Credit Agreement, respectively) has occurred or is continuing as a result of the settlement or the payment of the Settlement Amount.
(c) The settlement fully and finally resolves all litigation, claims, and disputes related to the Charter-Party and the M/V Aegean Fortuna. No further claims, counterclaims, or cross-claims remain outstanding between TSL (or any of its subsidiaries) and Northwind Maritime Corporation in connection with the matters that were the subject of the litigation.
7. Enclosures
For Meridian's records, we enclose herewith a copy of the fully executed Settlement Agreement and Mutual General Release (Execution Version, dated November 20, 2024). We respectfully note that this document is provided to Meridian subject to the confidentiality obligations set forth in Section 12 of the Settlement Agreement, and we would ask that Meridian treat the enclosed document, and the information contained therein, in accordance with the confidentiality provisions of the Credit Agreement and the Settlement Agreement.
TSL stands ready to provide any additional information, documentation, or certifications that Meridian may reasonably request in connection with this notification, including but not limited to updated financial statements, compliance certificates, or supplemental legal memoranda addressing any specific covenant or provision of the Credit Agreement.
8. Contact Information and Further Inquiries
Should you have any questions regarding this notice, or should you wish to request additional information or documentation in connection with the matters described herein, please do not hesitate to contact any of the following persons:
Douglas Carmichael Partner Calderwood & Harkness LLP One Liberty Plaza, 50th Floor New York, NY 10006 Telephone: (212) 558-4127 Facsimile: (212) 558-3591
Email: d.carmichael@calderwoodharkness.com
Markos Theodorakis General Counsel Thalassa Shipping & Logistics SA 42 Akti Miaouli Piraeus 185 38, Greece Telephone: +30 210 429 7300
Email: m.theodorakis@thalassasl.com
Elena Papadimitriou Chief Financial Officer Thalassa Shipping & Logistics SA 42 Akti Miaouli Piraeus 185 38, Greece Telephone: +30 210 429 7400
Email: e.papadimitriou@thalassasl.com
We trust that the foregoing provides Meridian with the information required under Section 8.14 of the Credit Agreement. We appreciate Meridian's continued support of TSL and remain available to address any further inquiries at your convenience.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Douglas Carmichael Partner
On behalf of Thalassa Shipping & Logistics SA
cc:
Markos Theodorakis, General Counsel, Thalassa Shipping & Logistics SA Elena Papadimitriou, Chief Financial Officer, Thalassa Shipping & Logistics SA Alexandros Stavridis, Chairman and Chief Executive Officer, Thalassa Shipping & Logistics SA Francesca Morano, Partner, Calderwood & Harkness LLP
Enclosure:
Settlement Agreement and Mutual General Release (Execution Version, dated November 20, 2024)

CONFIDENTIAL

CALDERWOOD & HARKNESS LLP

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