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EXHIBIT 4.(ii)(d)(1)
Contract No. MA-13579
COMMITMENT TO GUARANTEE OBLIGATIONS
by
THE UNITED STATES OF AMERICA
Accepted by
PROJECT AMERICA SHIP I, INC.,
Shipowner
(Under Title ▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇,
as amended, and in effect on the
date of this Guarantee Commitment)
Dated February 10, 2000
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TABLE OF CONTENTS
COMMITMENT TO GUARANTEE OBLIGATIONS
ARTICLE HEADINGS PAGE
RECITALS...................................................................................................1
ARTICLE I FINDINGS AND DETERMINATIONS OF SECRETARY....................................................2
ARTICLE II COMMITMENT TO GUARANTEE OBLIGATIONS..........................................................2
ARTICLE III THE OBLIGATIONS..............................................................................2
ARTICLE IV CONDITIONS TO EXECUTION AND DELIVERY OF THE GUARANTEE........................................3
ARTICLE V VARIATION OF GUARANTEE COMMITMENT ...........................................................5
ARTICLE VI TERMINATION OR ASSIGNMENT OF GUARANTEE COMMITMENT............................................5
ARTICLE VII MISCELLANEOUS................................................................................6
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COMMITMENT TO GUARANTEE OBLIGATIONS
THIS COMMITMENT TO GUARANTEE OBLIGATIONS, dated February 10, 2000 (the
"Guarantee Commitment"), made and entered into by the UNITED STATES OF AMERICA
(the "United States"), represented by the SECRETARY OF TRANSPORTATION, acting by
and through the MARITIME ADMINISTRATOR (the "Secretary"), and accepted on said
date by Project America Ship I, Inc., a Delaware corporation (the "Shipowner").
RECITALS:
A. The Shipowner is the sole owner of Hull No. 7671, an 840' passenger
vessel (the "Vessel") being constructed pursuant to the Construction Contract
between ▇▇▇▇▇▇▇ Shipbuilding, Inc. (the "Shipyard") and Project America, Inc.
(the "Guarantor"), dated March 9, 1999, and subsequently assigned to the
Shipowner.
B. To aid in financing the Construction of the Vessel, the Shipowner
will borrow an aggregate principal amount in Obligations not to exceed 87.5% of
the Depreciated Actual Cost or Actual Cost of the Vessel, as the case may be, as
of the Closing Dates. To accomplish such financing, the Shipowner has accepted
this Guarantee Commitment subject to the terms and conditions set forth herein.
C. The Shipowner has entered into the Note Purchase Agreement providing
for the sale and delivery, on the Note Closing Date, of notes in the aggregate
principal amount of $250,000,000, to be designated "United States Government
Guaranteed Ship Financing Notes" (the "Notes") having the maturity dates and
interest rates set forth in the Notes.
D. As security for the Guarantees and the Secretary's Note, (i) the
Shipowner will execute and deliver the Security Agreement, Contract No.
MA-13581, the Indenture, the Authorization Agreement, Contract No. MA-13580, the
Secretary's Note, the Financial Agreement, Contract MA-13583, and the Depository
Agreement, Contract No. MA-13584 and (ii) the Guarantor shall execute and
deliver the Parent Guarantee.
E. On the Bond Closing Date, the Shipowner will execute and deliver the
Bond Purchase Agreement providing for the sale and delivery, on the Bond Closing
Date, of bonds to be designated "United States Government Guaranteed Ship
Financing Bonds" (the "Bonds" and together with the Notes, the "Obligations") in
an aggregate principal amount, together with any Outstanding Notes, not to
exceed $534,447,000 having the maturity dates and interest rates set forth in
the Bond Purchase Agreement, the Indenture, and the Bonds.
WITNESSETH
That under the provisions of Title ▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇,
as amended and in consideration of (i) the covenants of the Shipowner contained
herein and (ii) other good and
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valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Secretary hereby commits itself as herein provided.
ARTICLE I
FINDINGS AND DETERMINATIONS OF THE SECRETARY
Pursuant to Section 1104A(b)(1) of Title XI, the Secretary has approved
the Shipowner as responsible and possessing the ability, experience, financial
resources and other qualifications necessary to the adequate operation and
maintenance of the Vessel.
Pursuant to Section 1104A(b)(2) of Title XI, the Secretary has
determined that the Depreciated Cost or Actual Cost of the Vessel, as the case
may be, is $610,797,578. Prior to the Closing Dates, the Secretary, in its
discretion, may redetermine the Depreciated Actual Cost or Actual Cost of the
Vessel. On the Closing Dates, the aggregate principal amount of the Outstanding
Obligations will not exceed 87.5% of the Depreciated Actual Cost or the Actual
Cost, as the case may be.
Pursuant to Sections 1104A(b)(3), 1104A(b)(4) and 1104A(b)(5) of Title
XI, the Secretary has determined or will determine that: (1) the maturity dates
of the Obligations are satisfactory, (2) payments of principal required by the
Obligations are satisfactory and (3) the interest rates to be borne by the
Obligations to be issued on the Closing Dates are reasonable.
Pursuant to Section 1104A(d) of Title XI, the Secretary has found that
the Shipowner's proposed use of the Vessel will be economically sound.
ARTICLE II
COMMITMENT TO GUARANTEE OBLIGATIONS
The United States, represented by the Secretary, hereby commits itself
to guarantee the payment of the unpaid interest on, and the unpaid balance of
the principal of, the Obligations, including interest accruing between the date
of default under the Obligations and the payment in full of the Guarantees, and,
to effect this Guarantee Commitment, hereby commits itself to execute and
deliver, the Security Agreement, the Financial Agreement, the Authorization
Agreement and the Depository Agreement on the Note Closing Date, and the
Mortgage on the Delivery Date pursuant to the terms of the Guarantee Commitment.
ARTICLE III
THE OBLIGATIONS
The Obligations shall be issued as a series of Notes and Bonds as
provided in the Indenture and in the form of the Note and the Bond, annexed to
the Indenture as Exhibit 2A and Exhibit 2B, respectively. The Obligations shall
be subject to all of the terms and conditions set forth in the Indenture.
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ARTICLE IV
CONDITIONS TO EXECUTION AND DELIVERY OF THE GUARANTEE
A. The obligation of the Secretary to execute and deliver the Guarantee on a
Note Closing Date and a Bond Closing Date shall be subject to the following
conditions unless waived in writing by the Secretary:
(a) the first Note Closing Date shall occur on or prior to April 8,
2000 and the final Bond Closing Date shall occur on or prior to one year from
the Delivery Date;
(b) the Shipowner and the Shipyard shall have executed and delivered to
the Secretary a copy of the Construction Contract and the Shipyard shall have
executed the Consent of Shipyard;
(c) the Shipowner shall have executed and delivered the following
documents in the form attached hereto: the Security Agreement, the Financial
Agreement, the Indenture, the Note Purchase Agreement, the Secretary's Note, the
Depository Agreement, the Authorization Agreement and the Notes;
(d) the Indenture Trustee shall have executed, in the form attached
hereto, the Indenture and the Authorization Agreement and the Depository shall
have executed the Depository Agreement;
(e) The Note purchaser shall have executed the Note Purchase Agreement;
(f) the Guarantor shall have executed and delivered, in the form
attached hereto, the Parent Guaranty;
(g) the following documents shall have been delivered to the Secretary:
(i) two executed counterparts of the Indenture, (ii) two specimen copies of the
Notes; (iii) two executed originals of the legal opinion issued under section
(l) of this Article; (iv) two copies of the legal opinion delivered to the
Obligees pursuant to the Note Purchase Agreement; and (v) two originals of all
other documents delivered by the Shipowner, the Guarantor, the Indenture Trustee
or the Depository in connection with this Closing.
(h) if the Shipowner intends to operate the Vessel in the U.S. domestic
trade, the Shipowner and any bareboat charterers of such Vessel shall have
furnished to the Secretary on the Note Closing Date an affidavit complying with
the requirements of 46 CFR Section 355, demonstrating U.S. citizenship;
(i) the Shipowner shall have executed an Officer's Certificate
representing and warranting the truth of the following statements as of the Note
Closing Date:
(i) each of the representations and warranties set out at
Section 2.01 of the General Provisions of the Security Agreement in
Appendix III; and
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(ii) the Shipowner is not in violation of any Federal laws
having a substantial adverse effect on the interests of the United
States of America and that the consummation of the Commitment complies
with non-Title XI Federal law.
(j) At the Closing of each Note or Bond, the Secretary shall receive
the Guarantee Fee based upon the principal amount and maturity of each
Obligation to be issued, set at three-eighths of one percent for each Note
issued during the construction of the Vessel, and three-quarters of one percent
(i) for each Note issued after the Delivery Date, and (ii) for each Bond, and
paid at the Closing of each Note or Bond;
(k) the Shipowner shall have complied in all material respects with its
agreements under this Guarantee Commitment;
(l) there shall not have occurred any event which constitutes (or after
any period of time or any notice, or both, would constitute) a "Default" under
the Security Agreement;
(m) there shall have been delivered to the Secretary by the Shipowner
an opinion of counsel acceptable to the Secretary, in the form annexed hereto as
Schedule 1 which shall include, among other things, an opinion to the effect
that: (i) by the terms of the Security Agreement, the Shipowner has granted to
the Secretary a fully perfected, first priority security interest in each of the
assets which constitutes the Security; and (ii) all filings, recordings, notices
and other actions required to perfect the Secretary's interests in the Security
and to render such security interests valid and enforceable under applicable
State law have been duly effected;
(n) the Secretary shall have received a letter agreement from the
Shipowner to provide the Secretary within a reasonable time after the Note
Closing Date, with five conformed copies of the Guarantee Commitment and each of
the Appendices and Exhibits thereto executed on or prior to such date;
(o) on the Note Closing Date, the qualifying requirements set forth in
Section 11 of the Financial Agreement shall have been complied with and
certified to as required therein; and
(p) at least ten days prior to the Note Closing Date, there shall have
been delivered to the Secretary, pro forma balance sheets for the Shipowner as
of the Note Closing Date, certified by an officer of the Shipowner showing,
among other things, all non-Title XI debt of the Shipowner;
(q) on the Note Closing Date, the Shipowner shall certify that all
non-Title XI loans to the Shipowner relating to the Vessel have been discharged
or subordinated satisfactorily to the Secretary;
(r) at least ten days prior to the Note Closing Date, the Shipowner
shall have provided the Secretary with satisfactory evidence of insurance as
required by the Security Agreement;
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(s) the Guarantor shall have executed and delivered the Parent
Guarantee, and;
(t) on the Note Closing Date the Shipowner shall execute a declaration,
in conformance with 31 USC 1352, disclosing all lobbying activities.
B. The obligation of the Secretary to execute and deliver a Secretary's
Determination on any subsequent Note Closing or the Bond Closing Date shall be
subject to the following conditions unless waived in writing by the Secretary:
(a) the Shipowner shall have executed and delivered the following
documents in the form attached hereto: the Notes and the Note Purchase Agreement
or the Bonds and the Bond Purchase Agreement, as the case may be;
(b) the Note purchaser or the Bond purchaser, as the case may be shall
have executed the Note Purchase Agreement or the Bond Purchase Agreement, as
applicable;
(c) the following documents shall have been delivered to the Secretary:
(i) one executed counterpart and one copy of the Note Purchase Agreement or Bond
Purchase Agreement and two conformed copies of the Offering Circular; (ii) two
specimen copies of the Notes or Bonds; (iii) two executed originals of the legal
opinion issued under section (k) of this Article; (iv) two copies of the legal
opinion delivered to the Obligees pursuant to the Note Purchase Agreement or
Bond Purchase Agreement, and (v) two originals of all other documents delivered
by the Shipowner, Indenture Trustee or the Depository in connection with the
Note Closing or Bond Closing;
ARTICLE V
VARIATION OF GUARANTEE COMMITMENT
No variation from the terms and conditions hereof shall be permitted
except pursuant to an amendment executed by the Secretary and the Shipowner.
ARTICLE VI
TERMINATION OR ASSIGNMENT OF GUARANTEE COMMITMENT
This Guarantee Commitment may be terminated and the parties hereto
shall have no further rights or obligations hereunder, upon written notice by
the Secretary of the termination of the obligations of the United States
pursuant to the Shipowner's failure to satisfy one or more conditions set forth
in Article IV hereof or upon the Secretary's determination, at or before the
Note Closing Date, that (i) the Shipowner is in violation of Federal law and
such violation would have a substantial, adverse affect on the interests of the
United States of America or (ii) the consummation of the Commitment would
violate non-Title XI Federal law. The Shipowner's warranties and representations
shall survive the termination of this Agreement and the Secretary's issuance of
the Guarantees. This Guarantee Commitment may not be assigned by the Shipowner
without the prior written approval of the Secretary and any attempt to do so
shall be null and void ab initio.
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ARTICLE VII
MISCELLANEOUS
(a) The table of contents and the titles of the Articles are inserted
as a matter of convenient reference and shall not be construed as a part of this
Guarantee Commitment. This Guarantee Commitment may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
(b) For all purposes of this Guarantee Commitment, unless otherwise
expressly provided or unless the context shall otherwise require, capitalized
terms used herein shall have the meaning given in Schedule X to the Security
Agreement.
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IN WITNESS WHEREOF, this Commitment to Guarantee Obligations has been
executed by the United States and accepted by the Shipowner, all as of the day
and year first above written.
UNITED STATES OF AMERICA,
SECRETARY OF TRANSPORTATION
BY: MARITIME ADMINISTRATOR
(SEAL)
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Secretary
ATTEST:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Assistant Secretary
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SHIPOWNER: PROJECT AMERICA SHIP I, INC.
(SEAL) ......... By /s/ Jordan ▇. ▇▇▇▇▇
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Its Executive Vice President
ATTEST:
By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
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Its Assistant Secretary