UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 28, 2005
ALEXANDER & BALDWIN, INC.
(Exact name of registrant as specified in its charter)
Hawaii 0-565 99-0032630
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(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
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incorporation) Identification No.)
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822 Bishop Street, P. O. Box 3440
Honolulu, Hawaii 96801
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(Address of principal executive office and zip code)
(808) 525-6611
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(Registrant's telephone number, including area code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2.):
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|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
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|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
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|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
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On June 28, 2005, Matson Navigation Company, Inc. ("Matson"), a wholly
owned subsidiary of Alexander & Baldwin, Inc. ("A&B"), entered into a $105
million 10-year Senior Secured Reducing Revolving Credit Facility (the
"Facility") with DnB NOR Bank ASA ("DnB NOR"), attached hereto as Exhibit 10.1.
The funds borrowed under the Facility will be used in connection with Matson's
purchase of a new containership, the MV Maunalei, for which Matson expects to
take delivery during the second quarter of 2006.
The MV Maunalei is the second of two containerships that Matson, in
February 2005, agreed to purchase from the Kvaerner Philadelphia Shipyard, Inc.
("Kvaerner") at a price of $144.4 million each. The Kvaerner contracts were
described in the Company's Form 8-K dated February 24, 2005 and filed with the
Securities and Exchange Commission on February 25, 2005. The financing for the
first vessel, the MV Manulani, was described in a Form 8-K dated May 19, 2005
and filed with the Securities and Exchange Commission on May 25, 2005.
The Facility provides for a 10-year commitment upon execution of the
agreement. Funding, however, will not occur until delivery of the MV Maunalei in
June 2006. The initial borrowing, upon delivery of the vessel, will be no more
than the lesser of $105 million or 75 percent of the total delivered cost of the
vessel. The maximum amount that can be drawn on the Facility declines in eight
annual commitment reductions of $10.5 million each, commencing on the second
anniversary of the closing date.
Although the entire $105 million could be drawn in 2006, concurrent
with the delivery of the MV Maunalei, Matson may choose initially to draw a
lesser amount. Matson may also re-borrow up to the maximum permitted by the
Facility, as described above. Amounts borrowed under the Facility will bear
interest at the one-, three-, six-, or twelve-month London Interbank Offered
Rate ("LIBOR"), at Matson's option, plus 0.375 percent for the first five years
or plus 0.450 percent for the second five years.
Matson's principal financial covenants include:
a) Maintaining a minimum net worth of the greater of $250 million or 65
percent of Matson's shareholders' equity as of the end of the prior
fiscal year.
b) Matson's working capital must remain positive.
c) Funded debt to Matson's net worth may not exceed 200 percent.
The Facility allows DnB NOR to place all or portions of the balances
with lenders that are acceptable to Matson and requires the application of
amounts received upon the sale of the MV Maunalei to the then-outstanding
balances. If the amounts received upon the sale of the vessel are not sufficient
to satisfy the outstanding balances, the shortfall would be due in a balloon
payment.
The Facility is secured by a first preferred mortgage on the MV
Maunalei and also includes an assignment of the vessel's earnings and
insurances. The form of these three agreements, which will be executed upon
funding of the Facility and delivery of the vessel, are included in Exhibit 10.1
of this Form 8-K as Exhibits B, C and D, respectively, to the Facility.
If Matson ceases to be a wholly owned subsidiary of A&B, the Facility
provides for additional financial covenants. Neither A&B nor Matson have any
other loans with DnB NOR.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
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Off-Balance Sheet Arrangement of a Registrant
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The information set forth under Item 1.01 is incorporated herein by
reference.
Item 9.01 Financial Statements and Exhibits
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(c) Exhibits
10.1 Senior Secured Reducing Revolving Credit Agreement between
Matson Navigation Company, Inc. and DnB NOR Bank ASA dated
June 28, 2005.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: June 28, 2005
ALEXANDER & BALDWIN, INC.
/s/ Christopher J. Benjamin
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Christopher J. Benjamin
Vice President and Chief Financial Officer