Vessel Finance & Leasing, Maritime Bankruptcies and Workouts

Full Scope of Transactional Work

As transportation industry transactions become more varied and complex, a maritime attorney who fully understands your industry, and the related technical, finance, tax and other implications involved is necessary.

Holland & Knight Vessel Finance attorneys have handled a variety of matters for clients, including:

• financing in both private and capital markets
• workouts and restructurings
• marine insurance, charter parties, oil pollution risks and maritime liens
• ship mortgage
• purchase and sale of corporate ship-owning entities
• projects that involve extensive corporate, tax, finance, environmental and other marine risk issues

U.S. and International Reach

Your legal advisors must be seasoned in guiding the finance and operation of vessels under the U.S. flag, as well as the flags of all other maritime jurisdictions. With Holland & Knight partners specializing in finance located on all U.S. coasts – East, Gulf and West – as well as Mexico City, we are capable of guiding operations wherever you conduct business.

Additionally, Washington, D.C., partners have been active in representing client interests in connection with Coast Guard, Homeland Security and Maritime Administration regulations and legislation. Our Mexico City attorneys have given extensive advice on ship mortgages and other vessel financing structures relating to Mexican flag vessels.

Other areas where we have supported clients include:

• structuring transactions to accommodate U.S. and foreign tax laws and negotiate lease-related tax indemnity agreements
• providing guidance as special Liberian, Marshall Islands, and Vanuatu counsel in transactions and issue legal opinions with respect to the laws of those nations
• structuring loans - from U.S. tax-based true leases to synthetic leases
• working with underwriters and issuers to raise funds through the public debt and equity capital markets
• working with U.S. government programs, including the Title XI, Capital Construction Funds, VISA and other programs
• handling matters of lender/lessor liability, both in the context of restructurings and OPA-90

Representative Cases

Corporate Maritime Transactions

• special maritime counsel to K-Sea Transportation Partners L.P. (IPO – NYSE listed) in its IPO and follow-on equity offerings
• special maritime counsel to U.S. Shipping Partners L.P. (IPO – NYSE listed) in its IPO
• special maritime counsel to Canadian National Railway in connection with its acquisition of Great Lakes Transportation
• special maritime counsel to CSX Corp./SeaLand in connection with CSX's original 1999 transaction and 2005 modifications respecting the sale by CSX of its international container shipping business (SeaLand)
• special maritime counsel to CSX Corp. in connection with sale of CSX Lines LLC (renamed Horizon Lines LLC) to the Carlyle Group
• counsel to Carnival Cruise Lines in connection with its unsecured credit line.
• special global maritime counsel to Mobil in the Exxon Mobil merger resulting in ExxonMobil
• special maritime and aviation counsel to Citicorp/Citibank in the Citicorp/Travelers merger resulting in Citigroup
• advising a major international shipping company in a prospective hostile tender of the shares of a U.S. listed international shipping company
• advising a major international financial institution as underwriter of a high yield debt offering for a foreign-based international shipping company
• advising an international shipowner on the defeasance of its secured public bond.
• Counsel to a U.S. based equity fund in connection with setting up a shipping joint venture with a non-U.S. based shipowner/operator
• counsel to non-U.S. based shipowner in connection with establishing a joint venture with U.S. based shipowner respecting a ro-ro vessel transferred to U.S. flag
• advising a U.S. financial institution of risks and structural mitigation thereof respecting joint ventures and corporate investments in shipowners/operators
• advising a bidder respecting purchased of a high end leisure cruise entity including U.S. Jones Act advice
• advising a potential purchaser of a U.S. tourist excursion shipowner including U.S. Jones Act advice
• advising an international shipowner in connection with its ownership structure to reflect the passing of the business to the second generation
• counsel to an AMEX listed Liberian shipowner respecting Liberian corporate issues

Loan and Lease Financings

• Marshall Islands counsel to ExxonMobil in the restructuring of financings involving six Marshall Islands flag tankers
• counsel to Citibank (lead bank) in secured financing and bond issues in the offshore industry (Pride, TODCO, McDermott)
• counsel to K-Sea Transportation Partners, L.P. in connection with numerous bank loan financings and construction contracts respecting Jones Act vessels
• counsel to institutional investors through a Panamanian trust in two synthetic lease financings of deepwater drillships bareboat chartered to joint ventures involving Conoco
• counsel to the Lenders in the financing of a mobile drilling rig owned by a Mexican entity
• counsel to the Equity Investors (U.S. financing companies) in lease financing of a Panamanian flag FPSO bareboat chartered to Petrobras and used in Brazilian waters
• counsel to the secured lenders in connection with the financing of Jones Act barges used for electrical power generation in New York City
• representing Nordea (lead bank) in secured financings in the refrigerated cargo industry (Chiquita; Del Monte) and in connection with various LNG and tanker financings
• counsel to the non-Jones Act charterer in the financing and chartering of U.S. Jones Act tug-boats with specialized fire fighting equipment
• representing either lenders or borrowers in connection with numerous loans secured by ship mortgages and related security on U.S., Canadian, Liberian, Marshall Islands and Vanuatu flag vessels
• advising an international bank in connection with Marshall Islands corporate questions and swaps transactions
• counsel to numerous Scandinavian banks and shipowners in connection with secured financings involving Liberian and/or Marshall Islands borrowers or vessels
• special maritime counsel to a U.S. investment bank as lender in connection with the financing of U.S. Jones Act shipowner
• counsel to subordinate lender in connection with the sale of participations
• counsel for oil company as bareboat charterer in connection with sale of vessels by shipowner (non-U.S. flag)

Title XI and Capital Construction Funds

• counsel to Borrower, K-Sea Transportation Partners and its predecessors, respecting $40 million double hulled barge financing, as extensively amended and restated in connection with the Borrower's IPO on the NYSE
• counsel to Borrower in the proposed Title XI financing of four vessels built in the U.S. that were to be owned by a Greek shipowner
• counsel on a $25 million shipyard modernization Title XI guaranteed loan for the NASSCO shipyard
• counsel to a Brazilian owner through a Bahamian company of a U.S. built (registered in Panama) large offshore vessel for the Brazilian oil industry financed through Title XI
• counsel to various U.S. shipowners in connection with establishing and maintaining capital construction funds (CCFs), a U.S. tax deferral product respecting income arising from certain U.S. vessel operations and used to modify or construct vessels in U.S. shipyards

Mexico City Office Experience

• counsel to the Lenders (international banks) in a number of Mexican flag tanker financings in which TMM subsidiaries are the borrowers structured through a Mexican guarantee trust
• counsel to the various Lenders (international banks) in three separate Mexican flag supply vessel financings that were structured as synthetic leases and that used a Mexican guarantee trust
• counsel to the Lenders (international banks and financial institutions) in several Mexican flag offshore vessel financings in which TMM subsidiaries are the borrowers structured through a Mexican guarantee trust
• counsel to the Lenders (U.S. financing companies) in financing of Panamanian flag rig bareboat chartered to a Mexican entity and used in Mexican waters. Mexican withholding taxes and enforcement of the hell and high water charter in Mexico were issues.
• counsel to Danish ship owner in two finance lease agreements covering vessels with a Mexican lessee

Maritime Bankruptcies and Workouts

• represented secured lender that credit bid its interests for 18 vessels of debtors and in litigation respecting over 20 third party maritime liens. Representation included successful litigation against maritime lien holders' challenges to bankruptcy court's jurisdiction over their maritime claims and successful litigation invoking the bankruptcy court's jurisdiction to interpret and enforce its own sale order. Universal Oil v. Allfirst Bank (In re Millenium Seacarriers, Inc.), 419 F.3d 83 (2d Cir. 2005);In re Millenium Seacarriers, Inc., 458 F.3d 92 (2d Cir. 2006).
• intervention on behalf of lenders in several U.S. proceedings involving arrest of vessels leading either to the release of the vessel or judicial sale. Following judicial sales, litigating maritime lien priority issues; for example, in re: MANATEE, litigating with 28 claimants, most of whom asserted priority over the mortgage.
• appearances for secured and unsecured creditors in Chapter 11 cases of cruise line (SeaEscape), marine offshore support company (Torch Offshore) and marine ship repair/ship construction company (Halter-Calcasieu)
• counsel to one venturer in a bankruptcy proceeding in the Southern District of New York involving the joint venture
• counsel for the shipowner in a bankruptcy dispute involving charters of vessels located in Mexican waters
• in the 1990s, representing lenders in connection with the worldwide workouts of the Eddie Shipping Company, Sanko, Wah Kwan and Prometheus Shipping Company involving mortgage enforcement proceedings in 16 jurisdictions including the U.S.
• representing lenders in connection with the worldwide workouts of the Tidal Marine, Colocotronis and Karavias fleets including mortgage enforcement proceedings in the U.S. and 20 overseas jurisdictions
• representing lenders in the workouts of TBS Shipping International and Mandate Shipping Company

Other Relevant Experience

• representation of a U.S. based aggregates corporation in connection with the construction contract for a self-unloading bulk carrier in Brazil
• advising a German shipowner respecting corporate structures to mitigate oil pollution risks
• advising a U.S. financial lessor respecting U.S. state law oil pollution issues
• advising a German bank respecting Liberian tax law issues and negotiating an official Liberian governmental opinion interpreting several Liberian tax statutes
• representation of a non-U.S. shipowner in connection with certain vessel transfers to Singapore flag
• representation of Enserch Corp., as lessee, in a lease financing of a deepwater floating oil & natural gas system in Garden Banks Reserve; concession rights and MARAD registration were involved
• representation of a Norwegian bank as agent in connection with U.S. issues arising out of a secured $1.1 billion loan to a fish farming and processing business
• extensive experience in negotiating vessel construction contracts internationally and in the U.S.
• representation of owners in numerous construction contracts relating to high-end yachts built in U.S. and non-U.S. jurisdictions, financing such construction, advising the owner on yacht registration and use, and other issues