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Exhibit 10.39F
Addendum No. 6
Contract No. MA/CCF-478
ADDENDUM TO
MARITIME ADMINISTRATION
CAPITAL CONSTRUCTION FUND AGREEMENT
WITH
NATIONAL STEEL AND SHIPBUILDING COMPANY
THIS AGREEMENT is made by and between the MARITIME ADMINISTRATOR (the
"Administrator"), and NATIONAL STEEL AND SHIPBUILDING COMPANY, a citizen of the
United States (the "Contractor"), as an addendum to that certain Capital
Construction Fund ("CCF") Agreement Contract No. MA/CCF-478 (the "Agreement").
WHEREAS:
1. The Administrator and the Contractor entered into the Agreement on
September 13, 1988, under Section 607 of the Merchant Marine Act, 1936, as
amended (the "Act"); and
2. The Contractor and its parent company NASSCO Holdings, Incorporated
("NHI") have been acquired by General Dynamics Corporation ("General Dynamics")
and are now wholly-owned subsidiaries of General Dynamics.
3. The parties hereto desire to amend the Agreement as set forth in
this Addendum.
NOW, THEREFORE, in consideration of the premises, the Administrator and
the Contractor agree as follows:
I. The Agreement will now become a consolidated Agreement with General
Dynamics as the new Contractor and shall include only those parties listed under
Attachment I. The defined term "Party" shall mean any or all of National Steel
and Shipbuilding Company, NHI, Bath Iron Works, or American Overseas, as the
case may be.
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II. The Agreement is amended by terminating the approval of the
Contractor's commercial paper program and deleting it from the Agreement.
III. Section 7(A) of the Agreement, including any referenced documents
therein, is hereby deleted and replaced with the following, including any
referenced documents herein:
"(A) The Party, at its discretion, may invest fund assets in third
party receivables of General Dynamics Corporation, or of its other
affiliates, assigned to the Party for that purpose, from progress
payment ▇▇▇▇▇▇▇▇ contracts, and under other contracts, with the
collection of such receivables to be guaranteed by the General
Dynamics Corporation if necessary to cause such receivables to be
"qualified investments," and in other investments which are "qualified
investments" under Maritime Administration rules and regulations, as
they exist at the present time or as they may be amended. Investments
in third party receivables of General Dynamics Corporation and its
affiliates shall be made pursuant to the terms and procedures of the
form of the Receivables Purchase and Sale Agreement and included
Exhibits, attached hereto as Appendix I."
IV. The existing Schedule B to the Agreement is replaced by the
attached revised Schedule B which: (A) deletes the construction of two 500
passenger cruise vessels; (B) increases the estimated vessel cost of the two
Roll-on/Roll-off Trailer Vessels from $135 million each to $175 million each;
and (C) adds the construction of four high speed Roll-on/Roll-off container
ships and four container ships as qualified program objectives.
V. The existing Schedule C to the Agreement is replaced by the
attached revised Schedule C which updates the list of qualified depositories
under the Agreement.
VI. Except as herein otherwise expressly provided, the Agreement, as
heretofore amended, shall remain in full force and effect.
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IN WITNESS WHEREOF, the parties have executed this Addendum No. 6 in
four counterparts, effective as of the 16th day of August, 1999.
(SEAL) UNITED STATES OF AMERICA
SECRETARY OF TRANSPORTATION
MARITIME ADMINISTRATOR
ATTEST
By: [SIG] By: [SIG]
--------------------------- ---------------------------
Secretary Contracting Officer
(SEAL) NATIONAL STEEL AND SHIPBUILDING
COMPANY
ATTEST
By: /s/ ▇. ▇. ▇▇▇▇▇▇ By: /s/ ▇. ▇. ▇▇▇▇▇▇▇▇
--------------------------- ---------------------------
Name: ▇. ▇. ▇▇▇▇▇▇ Name: ▇. ▇. ▇▇▇▇▇▇▇▇
--------------------------- ---------------------------
(print or type) (print or type)
Title: Assistant Secretary Title: President
--------------------------- ---------------------------
(print or type) (print or type)
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(SEAL) GENERAL DYNAMICS CORPORATION
ATTEST
By: /s/ ▇▇▇▇▇▇▇▇ ▇. House By: /s/ L. ▇▇▇▇ ▇▇▇▇
--------------------------- ---------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. House Name: L. ▇▇▇▇ ▇▇▇▇
--------------------------- ---------------------------
(print or type) (print or type)
Title: Asst. Secretary Title: Staff Vice President and Assistant Treasurer
--------------------------- ---------------------------
(print or type) (print or type)
Approved as to form:
By: [SIG]
---------------------------
Assistant Chief Counsel
Maritime Administration
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ATTACHMENT I
GENERAL DYNAMICS CORPORATION
CONSOLIDATED COMPANIES
National Steel and Shipbuilding Company
NASSCO Holdings, Incorporated
Bath Iron Works
American Overseas Marine
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Revised Schedule B
MA/CCF-478
SCHEDULE B
PROGRAM OBJECTIVES
ACQUISITION OR CONSTRUCTION OF VESSELS
Amount to
Vessel be Approx. Approx. Anticipated
Program Name Withdrawn Date Date Area
Objective and General Vessel from Fund of of of
Number Number Characteristics Cost (Approx.) (Approx.) Contract Delivery Operation
----------- ---------- ------------------------------------- --------------- ----------- ---------- --------- ---------------
1 Unknown Three 140,000 DWT Product Tankers $200 million $80 1st qtr Non-Contiguous
each million 2000 2002 Trade
2 Unknown Two Roll-on Roll-off Trailer Vessels $175 million $80 3rd qtr Non-Contiguous
each million 1999 2002 Trade
3 Unknown Four High Speed Roll-on Roll-off $300 million $80 3rd qtr Non-Contiguous
Container Ships each million 1999 2002 Trade
4 Unknown Four Container Ships $100 million $80 4th qtr Non-Contiguous
each million 1999 2001 Trade and
Puerto Rico
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Revised Schedule C
MA/CCF-478
SCHEDULE C
DEPOSITORIES
NAME AND ADDRESS(1) ACCOUNTS
----------------------------------------------------------------------------
Bank of America Investment Account
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇. established pursuant to
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
Bank One Investment Account
One First National Plaza established pursuant to
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
Citibank N.A. Investment Account
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ established pursuant to
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
Mellon Bank N.A. Investment Account
4 Mellon Bank Ctr. established pursuant to
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
The Bank of New York Investment Account
One Wall Street established pursuant to
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
The Northern Trust Company Investment Account
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ established pursuant to
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
First Union National Bank Investment Account
One First Union Center established pursuant to
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
Wachovia Bank N.A. Investment Account
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ established pursuant to
▇▇▇▇▇▇▇-▇▇▇▇▇, ▇▇ ▇▇▇▇▇ 46 C.F.R. Section 390.7
-------------------------
1 The addresses set forth below represent the main office of each
depository. The actual branch office used for deposits may vary.
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[EXECUTION FORM) APPENDIX I
RECEIVABLES PURCHASE AND
SALE AGREEMENT BETWEEN
GENERAL DYNAMICS CORPORATION
AND
(QUALIFIED AFFILIATE)
THIS AGREEMENT made on ___________, 19____, by and between GENERAL
DYNAMICS CORPORATION, a corporation organized and existing under the laws of the
State of Delaware ("General Dynamics") and (Qualified Affiliate).
WITNESSETH:
WHEREAS:
1. General Dynamics is engaged directly, and through subsidiary and
affiliated corporations (collectively such subsidiary and affiliated
corporations being referred to herein as "Affiliates"), in the businesses of
building ships for the U.S. Government and privately and publicly held
corporations.
2. The monies earned from these activities are received by General
Dynamics, and/or its Affiliates, under various forms of contracts for the most
part involving progress payments, dependent upon the state of completion of the
projects, the proceeds of which are generally subject to assignment.
3. General Dynamics maintains a consolidated capital construction fund
(the "Fund") within the meaning of Section 607 of the Merchant Marine Act, 1936,
as amended (the "Act") pursuant to the terms of an original agreement between
NASSCO and the Maritime Administration, Department of Transportation, dated as
of September 14, 1988, as amended (the "Agreement"), and desires to invest and
reinvest certain monies or the proceeds of property deposited and to be
deposited, from time to time, into the Fund in an undivided interest in Eligible
Receivables held by General Dynamics or any Qualified Affiliate, as such terms
are defined below.
4. (General Dynamics or Qualified Affiliate) proposes to sell and
General Dynamics proposes to purchase, for the account of the Fund, an undivided
interest in Eligible Receivables arising from time to time and held by (General
Dynamics or Qualified Affiliate).
NOW THEREFORE, in consideration of the premises and the mutual
promises, and subject to the terms and conditions hereinafter set forth, it is
hereby agreed:
1. ELIGIBLE RECEIVABLES. Subject to the limitations of paragraph 2
(investment, share, percentage), General Dynamics may purchase from time to time
from any itself or any Qualified Affiliate for the account of the Fund an
undivided interest in Eligible Receivables. An "Eligible Receivable" shall be an
evidence of indebtedness of the United States of America, or any instrumentality
or agency thereof, or of any party organized under the laws of the United States
or a state thereof, unrelated to General Dynamics or any of its Affiliates,
payable in
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United States dollars and acquired by General Dynamics or any Qualified
Affiliate in the ordinary course of business. Notwithstanding the foregoing, an
Affiliate shall qualify to sell evidences of indebtedness to General Dynamics
for the account of the Fund under this Agreement ("Qualified Affiliate") only
upon delivery of a written instrument agreeing to (i) authorize General Dynamics
to act on its behalf where appropriate or required hereunder, (ii) perform any
of the acts that General Dynamics has agreed hereunder to cause such Affiliate
to perform, and (iii) otherwise bound by the terms of this Agreement.
2. INVESTMENT, SHARE AND PERCENTAGE. The cumulative dollar amount paid
or consideration given by General Dynamics hereunder for the purchase of an
undivided interest in Eligible Receivables from General Dynamics ("General
Dynamics Receivables") or from any Qualified Affiliate ("Affiliate Receivables")
less, in each case,-the proceeds received by the Fund upon any sale of such
undivided interest as described in paragraph 13 (REPURCHASE) is hereinafter
referred to as "General Dynamics Investment" or "Affiliate Investment,"
respectively, (collectively "Investment"). The Fund's undivided interest,
expressed as a dollar amount, in General Dynamics Receivables or Affiliate
Receivables is hereinafter referred to individually as "General Dynamics Share"
or "Affiliate Share", respectively (collectively "share"), and in each case
shall at any time be equal to General Dynamics Investment or Affiliate
Investment, as the case may be, multiplied by the sum of one plus the Discount
Factor (as defined below) applicable thereto. The Fund's undivided interest,
expressed as a percentage, in General Dynamics Receivables or Affiliate
Receivables, is hereinafter referred to as "General Dynamics Percentage" or
"Affiliate Percentage", respectively, and in each case shall at any time be
equal to General Dynamics Share or an Affiliate Share, as the case may be,
divided by the face value of General Dynamics Receivables or the applicable
Affiliate Receivables, respectively.
3. ELECTION AND ASSIGNMENT. If General Dynamics elects to purchase
Eligible Receivables initially or from time to time, on behalf of the Fund, it
shall execute and deliver an instrument of election ("Election") in the form set
forth in Exhibit A to General Dynamics or the applicable Qualified Affiliate, as
the case may be, not less than two business days prior to the requested
effective date thereof. Pursuant to the Election, General Dynamics will sell,
transfer, and assign to NASSCO, in the case of General Dynamics Receivables, and
will cause the applicable Qualified Affiliate to sell, transfer and assign to
General Dynamics, in the case of Affiliate Receivables, in each case on behalf
of the Fund, an undivided interest in such Eligible Receivables. The sale,
transfer and assignment shall be evidenced by execution of an instrument of
assignment ("Assignment") in the form set forth in Exhibit B. A copy of each
Assignment shall be delivered to the Fund depository as evidence of the Fund's
investment in accordance with Section 607(c) of the Merchant Marine Act, 1936,
as amended. The initial or any change in the level of either General Dynamics
Investment or Affiliate Investment, respectively, shall be distinguished from
the periodic reinvestment of any General Dynamics Share or Affiliate Share as
described in paragraph 9 (ONGOING REINVESTMENT), which shall require no Election
or Assignment
4. TITLE. From the time of General Dynamics' initial purchase of Share
through any adjustment in such Share from time to time, such Share shall be and
become the exclusive property of the Fund.
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5. AGENCY.
(a) Possession and Records. With respect to all Eligible Receivables
in which the Fund owns an undivided interest from time to time,
General Dynamics shall, in the case of General
Dynamics-Receivables, and shall cause the applicable Qualified
Affiliate, in the case of Affiliate Receivables, in each acting as
agent on behalf of General Dynamics and the Fund, to maintain
physical possession of the Eligible Receivables and all records
pertaining thereto, which records shall indicate in writing that
the Fund has an undivided interest in the Eligible Receivables and
shall be sufficient to distinguish the Fund's interest therein
from General Dynamics's or such Qualified Affiliate's remaining
interest.
(b) Collection. Subject to the exercise of reasonable business
judgment, General Dynamics shall, in the case of General Dynamics
Receivables, and shall cause the applicable Qualified Affiliate,
in the case of Affiliate Receivables, to use reasonable efforts to
process and collect Eligible Receivables in the same manner and
with the same diligence as it or such Qualified Affiliate
processes and collects its other receivables. In addition General
Dynamics shall in its own name, in the case of General Dynamics
Receivables, and shall cause the applicable Qualified Affiliate,
in the case of Affiliate Receivables, to (i) endeavor to collect,
or cause to be collected, from its customers or those of the
applicable Qualified Affiliate as and when due any and all amounts
owing under or on account of Eligible Receivables, and (ii) take,
or cause to be taken, such action to enforce rights under any such
Eligible Receivables as it or such Qualified Affiliate deems
reasonably proper.
(c) Collection Agencies: Compliance with Law. General Dynamics or any
Qualified Affiliate may employ collection agencies or others to
collect defaulted Eligible Receivables. In acting with respect to
Eligible Receivables, General Dynamics will and will cause each
Qualified Affiliate to comply with all laws, official rulings and
regulations and will indemnify and hold the Fund harmless from and
against any and all penalties or losses which might be incurred by
the Fund as the result of General Dynamics's or any Qualified
Affiliate's negligence or failure to comply therewith.
(d) Enforcement by the Fund. The Fund will take any action to collect
Eligible Receivables or to otherwise enforce the Fund's legal
interest therein, unless General Dynamics has made a determination
not to or is unable to, or does not cause the applicable Qualified
Affiliate to or such Qualified Affiliate is unable to proceed for
collection and does not otherwise hold the Fund harmless through
the operation of paragraph 12 (UNCOLLECTIBLE RECEIVABLES). In no
event shall the Fund take any action to collect any Eligible
Receivables of the United States of America or any agency or
instrumentality thereof which have not been assigned in accordance
with the Assignment of Claims Act
(e) Servicing Costs. General Dynamics will reimburse each Qualified
Affiliate, as appropriate, on a monthly basis, but not from the
Fund, for the performance of
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services required by this paragraph in an amount equal to the
actual costs incurred in connection with such services as
determined from time to time (i) for the General Dynamics
Receivables by multiplying such costs by the General Dynamics
Percentage of the General Dynamics Receivables owned by the Fund,
and (ii) for each Affiliate's Receivables by multiplying such
costs by such Affiliate's Percentage of such Affiliate Receivables
owned by the Fund. General Dynamics shall, in the case of General
Dynamics Receivables, and shall cause the applicable Qualified
Affiliate, in the case of Affiliate Receivables, to keep records
reasonably required to allow NASSCO to verify any amounts charged
hereunder.
(f) Power of Attorney. General Dynamics, on behalf of itself and the
Fund, hereby grants to each Qualified Affiliate, as appropriate,
an exclusive power of attorney to process and collect the interest
of the Fund in Eligible Receivables, which shall be revocable only
if such Qualified Affiliate is unable to proceed for collection
and does not otherwise hold the Fund harmless through the
operation of paragraph 12 (UNCOLLECTIBLE RECEIVABLES).
6. Audit. General Dynamics shall, in the case of General Dynamics
Receivables, and shall cause the applicable Qualified Affiliate,
in the case of Affiliate Receivables, to (a) maintain such
documents in accordance with its regular practice as may be
required for the collection of Eligible Receivables; (b) maintain
such accounts and other records as will enable it to determine
upon request the status of the Fund's General Dynamics Share or
Affiliate Share; (c) permit, on reasonable notice and during
normal business hours, the inspection, auditing, checking and
making abstracts from General Dynamics's and such Qualified
Affiliate's accounts, records, correspondence and other papers
pertaining to Eligible Receivables; and (d) deliver, upon request
copies of any of such accounts, records, correspondence and other
papers as it may reasonably deem essential with respect to
Eligible Receivables.
7. ACCOUNT1NG MONTH. This Agreement shall be administered on the
basis of NASSCO's accounting month. The last business day of each
accounting month shall constitute an "Account Clearing Date."
General Dynamics shall, in the case of General Dynamics
Receivables, and shall cause the applicable Qualified Affiliate,
in the case of Affiliate Receivables, to develop data, analyses
and reports in accordance with paragraph 8 (DISCOUNT) as of each
Account Clearing Date. These data, analyses and reports shall be
provided no later than the Account Clearing Date for the
subsequent month. If any change in the level of Investment occurs
on a day other than an Account Clearing Date, then for purposes of
all calculations, sales, collections and expenses shall be deemed
to have occurred ratably over the month.
8. DISCOUNT. Purchases for the account of the Fund with respect to
each of the General Dynamics Receivables or any Affiliate
Receivables, as the case may be, shall be for a consideration
equal to an amount which is lower than the applicable General
Dynamics Share or Affiliate Share by the amount of a
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"Discount" (as defined below), which reflects the expected days to
collect such General Dynamics Receivables or Affiliate Receivables
("Contract Collection Days") and the "Rate" (as defined below).
The Discount with respect to each of the General Dynamics
Receivables and any Affiliate Receivables, as the case may be,
shall be separately determined in the following manner
(a) Contract Collection Days shall initially be set at 45 days,
which is the current estimate of the average of the actual
collection days for the Eligible Receivables. For each year
after 1988, the Contract Collection Days shall be the
average of actual experience with Eligible Receivables for
the immediately preceding year or as otherwise mutually
agreed.
(b) Actual Collection Days are calculated for each month by
multiplying the month-end Eligible Receivables balance by
the number of days in the month and dividing that value by
the aggregate amounts invoiced during the month for the
customer accounts which generate Eligible Receivables.
(c) The initial discount rate for each purchase shall be ten
percent (10%) per annum, which rate shall be adjusted from
time to time by General Dynamics to reflect current market
conditions.
(d) The Discount Factor for each purchase equals the Rate
multiplied by Contract Collection Days.
(e) The Fund's General Dynamics Share or Affiliate Share shall
equal the General Dynamics Investment or Affiliate
Investment, respectively, multiplied by the sum of one plus
the Discount Factor applicable thereto.
(f) The Discount with respect to General Dynamics Receivables
equals General Dynamics Investment multiplied by the
applicable Discount Factor, and the Discount with respect to
any Affiliate Receivables equals such Affiliate Investment
multiplied by the applicable Discount Factor.
(g) Discount Income equals the product of days in such month
multiplied by the Discount for such month and divided by the
Contract Collection Days for such month.
9. ONGOING REINVESTMENT. The make-up of the Eligible Receivables will
change continuously as individual evidences of indebtedness are collected and
new evidences of indebtedness are generated in the normal course of General
Dynamics's and each Qualified Affiliate's businesses. Collections with respect
to Eligible Receivables included in General Dynamics Share or Affiliate Share
shall be routinely and immediately reinvested in other Eligible Receivables. All
credits under paragraph 10 (MONTHLY ESTIMATED CREDITS) and annual adjustments
under paragraph 11 (ANNUAL ADJUSTMENT FOR ACTUAL COLLECTIONS) shall be deemed to
be immediately reinvested in other Eligible Receivables unless General
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Dynamics or a Qualified Affiliate, as the case may be, elects to make payment in
cash to the Fund.
10. MONTHLY ESTIMATED PAYMENTS. General Dynamics shall, in the case of
General Dynamics Receivables, and shall cause the applicable Qualified
Affiliate, in the case of Affiliate Receivables, in each case, as of the end of
each Account Clearing Date and before the next following Account Clearing Date
to make calculations as shown by example in the applicable Exhibit D (note, each
selling entity will have a separate Exhibit D) and, credit the Fund, for the net
of the following items:
(a) The Fund's Discount Income for such General Dynamics Receivables
or the applicable Affiliate Receivables, as the case may be, for
the month, plus
(b) The General Dynamics Percentage and each Affiliate Percentage, as
the case may be, of finance revenue, if any, for such General
Dynamics Receivables or Affiliate Receivables, respectively,
(i.e., interest charges collected on Eligible Receivables during
the month).
For each monthly period, General Dynamics each Qualified Affiliate, as
appropriate, the monthly costs as described in paragraph 5(e) (AGENCY -
SERVICING COSTS).
11. ANNUAL ADJUSTMENT FOR ACTUAL COLLECTIONS. After the end of each
calendar year, adjustments shall be made between General Dynamics and each
Qualified Affiliate, as applicable, and the Fund to reflect the Actual
Collection Days for such General Dynamics Receivables and Affiliate Receivables,
as the case may be, as experienced for each month of the expired year. As
described in Exhibit D (in which certain terms used hereinafter in this
paragraph are defined), an Adjusted Daily Income for the General Dynamics
Receivables and the applicable Affiliate Receivables shall be calculated based
on Actual Collection Days for such General Dynamics Receivables or Affiliate
Receivables, as appropriate, and an adjustment for the General Dynamics
Receivables and the applicable Affiliate Receivables shall be calculated by
multiplying the number of days in each month times the difference between Daily
Income and Adjusted Daily Income. The adjustments for each of the 12 months
shall be added, and a net credit or charge for the year shall be settled,
between General Dynamics or the applicable Qualified Affiliate and the Fund, on
or before the second Account Clearing Date of the new year.
12. UNCOLLECTIBLE RECEIVABLES. General Dynamics undertakes to hold the
Fund harmless from any risk of loss due to uncollectibility of General Dynamics
Receivables or Affiliate Receivables. Should any General Dynamics Receivables or
Affiliate Receivables be determined in accordance with General Dynamics's or
such Qualified Affiliate's normal business practices to be uncollectible, such
receivable shall no longer be deemed to be an Eligible Receivable, and
accordingly, the General Dynamics Percentage or the Affiliate Percentage in the
remaining General Dynamics Receivables or such Affiliate Receivables, as
appropriate, shall be increased in compensation therefor.
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13. REPURCHASE. General Dynamics may, in the case of General Dynamics
Receivables, and may require the applicable Qualified Affiliate, in the case of
Affiliate Receivables, to repurchase all or any portion of General Dynamics
Share or Affiliate Share, as applicable, from time to time, provided, however,
that such a repurchase may be required only if necessary to provide funds for
withdrawals from the Fund pursuant to Section 607(g)(4) of the Merchant Marine
Act, 1936, as amended. Such repurchase shall be made in accordance with the
provisions of paragraph 3 (ELECTION AND ASSIGNMENT). An election shall be
executed and delivered by General Dynamics, and the repurchase shall be
evidenced by the execution and delivery of an instrument of repurchase in the
form set forth in Exhibit C.
14. REPRESENTATIONS AND WARRANTIES BY General Dynamics AND EACH
QUALIFIED AFFILIATE. General Dynamics hereby represents and warrants and shall
cause each Qualified Affiliate to represent and warrant, in both cases to NASSCO
and the Fund as follows:
(a) the figures set forth in statements or documents which are
required to be delivered by General Dynamics or such
Qualified Affiliate hereunder will be true and correct as of
the time made;
(b) at the time of the assignment of an undivided interest in
Eligible Receivables, General Dynamics or such Qualified
Affiliate will have good and valid title to the undivided
interest to be assigned to the Fund and such Eligible
Receivables will represent valid and legally enforceable
obligations of customers in connection with sales of
products or services;
(c) at the time of assignment, beneficial ownership in the
undivided interest to be assigned to the Fund will not have
been conveyed or assigned to any other person, firm or
corporation;
(d) each instrument of assignment executed and delivered to the
Fund Depository hereunder will vest in the Fund an undivided
interest in all of General Dynamics's or such Qualified
Affiliate's right and interest in and to the Eligible
Receivables covered by such instrument and the proceeds of
collection thereof, in each case free and clear from claims
of any third parties;
(e) at the time of assignment of an undivided interest in
Eligible Receivables (i) such interest will be free and
clear of all liens and encumbrances whatsoever; (ii) the
Eligible Receivables will conform to any and all applicable
laws and regulations; and (iii) all obligations to be
performed by General Dynamics or such Qualified Affiliate or
by any other person or persons under or in connection with
Eligible Receivables (except payment thereof), including
obligations with respect to the products, merchandise or
services, the sale or performance of which gave rise to any
of
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such Eligible Receivables, will have been, or will promptly
be, fulfilled; and
(f) General Dynamic's exclusive remedy, on behalf of the Fund,
for breach of the representations and warranties contained
in paragraph 14 shall be limited to the remedy with respect
to an uncollectible receivable contained in paragraph 12
(UNCOLLECTIBLE RECEIVABLES), provided that in no event shall
the Fund incur an economic loss as a result of any such
breach.
15. WAIVERS. Each party hereby waives any failure or delay on the part
of the other party in asserting or enforcing any rights or in making any claims
or demands.
16. SUCCESSORS. The covenants, representations, warranties and
agreements herein set forth shall be mutually binding upon, and inure to the
mutual benefit of General Dynamics and, where applicable, any Qualified
Affiliate, on the one hand, and NASSCO, on the other hand and upon approval of
the Maritime Administration shall inure to their respective successors and
assigns.
17. DURATION AND TERMINATION. The term of this Agreement shall commence
on the date of its execution and shall terminate on September ___, 2013. Either
party has the right to terminate this Agreement at any time with immediate
effect (a) for breach of a material provision of this Agreement by the other
party, (b) if circumstances occur (i) which significantly affect the economic or
legal effects of this Agreement and (ii) which circumstances have not been
anticipated in this Agreement and (iii) the parties are unable to agree on a
reasonable means to continue operating under this Agreement in the context of
the changed circumstances, or (c) if either of the parties experience business
or structural changes which make it unreasonable for such party to continue to
adhere to this Agreement.
18. FURTHER ASSURANCES. General Dynamics shall, and shall cause each
Qualified Affiliate to do, make, execute and deliver all additional and further
acts, things and documents as the other may reasonably require to more
completely vest in and assure to the Fund its undivided interest and rights
hereunder and to otherwise carry out the intention of this Agreement.
19. GOVERNING LAW. This Agreement shall in all respects be governed by,
and construed in accordance with, the laws of the State of Delaware.
20. ASSIGNMENT AND AMENDMENT: This Agreement may not be assigned by
either party without the prior written consent of the other party and the
approval of the Maritime Administration. This Agreement may not be amended
without the prior written consent of the Maritime Administration.
8
16
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first above written.
GENERAL DYNAMICS CORPORATION
By:
--------------------------- ---------------------------
Attest
Authorized Signatory
Date:
---------------------------
(Qualified Affiliate)
By:
--------------------------- ---------------------------
Attest
Authorized Signatory
Date:
---------------------------
9
17
EXHIBIT A
, 1988
------------------
Pursuant to the Receivables Purchase and Sale Agreement dated as of
__________, 19__, General Dynamics and [and the Qualified Affiliate Instrument,
dated _____________], General Dynamics hereby elects to increase the Fund's
Investment by purchasing an additional undivided interest in certain accounts
receivable of [General Dynamics] [Qualified Affiliate], which accounts
receivable are more fully described in said Agreement.
Election is as follows:
New [General Dynamics] [Affiliate] Investment $
-------------------
Change from prior Election
---------------------------
Effective date requested
---------------------------
General Dynamics Corporation
By:
-------------------------
Authorized Signatory
10
18
EXHIBIT B
ASSIGNMENT OF UNDIVIDED INTEREST IN ACCOUNTS RECEIVABLE
Pursuant to the Receivables Purchase and Sale Agreement dated as of
____________, 19__, between General Dynamics [and the Qualified Affiliate
Instrument, dated __________], and for the consideration expressed therein,
[General Dynamics] [Qualified Affiliate] hereby sells, transfers, and assigns to
the Fund all of its rights, title and interest in and to an undivided interest
in Eligible Receivables (as defined in such Agreement), in an amount
constituting [General Dynamics] [Affiliate] Investment (as so defined) as set
forth below:
$
-----------------------
[General Dynamics] [Qualified Affiliate] agree that the sale of an
undivided interest in Eligible Receivables shall be governed by the
above-referenced Agreement[s] which [is] [are] incorporated herein by reference.
AGREED TO as of .
-----------------------------
GENERAL DYNAMICS CORPORATION (Qualified Affiliate)
By: By:
--------------------------- ---------------------------
Authorized Signatory Authorized Signatory
RECEIVED ON , 19 .
------------------ ----
[FUND DEPOSITORY]
By:
---------------------------
Authorized Signatory
11
19
EXHIBIT C
REPURCHASE OF UNDIVIDED INTEREST IN ACCOUNTS RECEIVABLE
Pursuant to the Receivables Purchase and Sale Agreement dated as of
__________, 19___, between General Dynamics and [and the Qualified Affiliate
Instrument dated __________], and for the consideration expressed therein, the
Fund hereby sells, transfers, and assigns to [General Dynamics] [Qualified
Affiliate] all of the Fund's right title and interest in and to an undivided
interest in Eligible Receivables (as defined in such Agreement), in an amount
constituting [General Dynamics] [Qualified Affiliate] Investment (as so defined)
as set forth below:
$
-----------------------
[General Dynamics] [Qualified Affiliate]agree that the sale of an
undivided interest in Eligible Receivables shall be governed by the
above-referenced Agreement[s] which [is] [are] incorporated herein by reference.
AGREED TO as of .
-----------------------------
GENERAL DYNAMICS CORPORATION [GENERAL DYNAMICS CORPORATION]
[Qualified Affiliate Name]
By: By:
--------------------------- ---------------------------
Authorized Signatory Authorized Signatory
RECEIVED ON , 19
------------------ ----
[FUND DEPOSITORY]
By:
---------------------------
Authorized Signatory
12
20
EXHIBIT D APPENDIX I
EXAMPLE CACULATIONS
FOR [SPECIFY General Dynamics OR QUALIFIED AFFILIATE AS APPROPRIATE]
(Not purported to reflect actual or expected rates or balances)
Item Name Calculation Symbol Month 1 Month 2
--------- ----------- ------ ------- -------
MONTHLY
Ending Eligible
Receivables Balance B 100,000,000 75,000,000
Amounts Invoiced
for Month MI 75,000,000 80,000,000
Finance Revenue FR 3,000 4,000
Bad Debt Provision BD 200,000 150,000
Days in Month MD 30 31
Contract Collection Days CCD 32 32
Actual Collection Days (B * MD / MI) ACD 40 29.1
Interest Rate, Annual IA .10 .10
Interest Rate, Daily (IA / 365) ID .0002740 .0002740
Discount Factor (ID * CCD) DF .0087671 .0087671
Assignment Increase AI 30,000,000 247,478
Investment (Prior INV + AI) INV 30,000,000 30,247,478
Discount (INV * DF) D 263,013 265,183
Share (INV * (1 + DF)) S 30,263,013 30,512,661
Share Daily Income (D / CCD) DI 8,219 8,287
Share Finance Revenue (FR * S / B) SFR 908 1,627
Share Bad Debt Provision (Paragraph 13) SBD 0 0
Share Monthly Income ((DI * MD) + SFR) SMI 247,478 258,524
YEAR-END ADJUSTMENT
Adjusted Daily Income (D / ACD) ADI 6,575 9,113
Adjustment (MD * (ADI - DI)) ADJ -49,320 25,60
13
