TPMD PWS Support Services Final.pdf

EXPORT-IMPORT BANK ON BEHALF OF

THE OFFICE OF BOARD AUTHORIZED FINANCE’S TRANSPORTATION

PORTFOLIO MANAGEMENT DIVISION TO PROVIDE TRANSPORTATION

MONITORING TECHNICAL SUPPORT SERVICES

PERFORMANCE WORK STATEMENT (PWS)

Aug 24, 2020

1.0 INTRODUCTION

The Contractor shall provide all personnel, equipment, supplies, facilities, transportation, tools, materials, supervision, and other items and non-personal services necessary to perform transportation portfolio monitoring technical professional support services as defined in this Performance Work Statement except for those items specified as Government furnished property and services.

2.0 BACKGROUND

• The need for this support has arisen due to the COVID-19 pandemic. Due to COVID related travel restrictions, the airline industry and EXIM’s aircraft portfolio have come under significant unexpected strain. Due to the COVID-19 pandemic (Pandemic), approximately 20 different airlines or other EXIM transportation division or TPMD borrowers/primary sources of repayment have informed EXIM that they face financial difficulties and either have declared, have threatened to declare or will declare bankruptcy or seek some form of restructuring, payment or other financial relief from EXIM. EXIM anticipates that the number of such requests and/or bankruptcies will increase as the Pandemic continues.

• Even when aircraft are not being operated, under applicable law and to retain their “airworthy” status, they must be regularly maintained by specialized, costly and licensed mechanics. Even storing inactive aircraft in hangars can be expensive. Further, local law under some jurisdictions may require the airlines -as employers - to offer their employees additional benefits should they fall ill due to the Pandemic, such as extended paid sick leave or extended paid administrative time off, further adding to the airlines’ debt load.

Additionally, if an airline furloughs its employees, the airline might in certain circumstances be required to offer the furloughed employees expensive additional benefits under applicable law. In some jurisdictions, airlines may be sued, including via costly class actions, for recovery of fees incurred with respect to cancelled flights or on other terms, and must incur substantial legal fees to defend themselves in such lawsuits. Thus, airlines have maintained a high cost base, coupled with a shrinking revenue base due to the Pandemic and its repercussions, and this situation is made worse with the specter of potential mandated increases in benefits to its employees as a social “safety net”. This has led to their payment difficulties, and caused them to ask EXIM, as well as their other lenders and creditors, for financial relief or to declare bankruptcy, as applicable. This same need for relief could apply to EXIM’s operating lessor customers, as they rely on airlines’ payments made under their operating leases.

• Given the above, the Transportation Portfolio Management Division (TPMD) needs additional help with monitoring this portfolio by contractors with significant subject matter expertise in the aircraft industry, with EXIM’s transportation portfolio, and with the functions and documentation associated with transportation asset management, such as transportation credit and other legal agreements, restructurings, and the Cape Town protocol.

3.0 SCOPE

Contractor shall provide commercial technical, aircraft-finance related or other EXIM transportation division transaction-related support services. Services shall include, but not be limited to, conducting due diligence, drafting, revising, providing recommendations on how to negotiate agreements and ancillary documentation or memoranda. Services shall include assisting EXIM with recommendations and support to preserve EXIM’s collateral and exercising rights and remedies under EXIM’s transaction documents. Contractor shall provide support services regarding at-risk non-aircraft transactions, involving rail, rail infrastructure, maintenance, repair and overhaul services transactions, or any other complex, structured financial transaction experiencing financial difficulties due to, impacted by, or made worse following the COVID-19 global pandemic response, including support services for all EXIM TPMD or transportation division transactions, regardless of their nature.

4.0 OBJECTIVES (NATURE OF WORK)

Desired Outcome: Analysis of ongoing monitoring; more specific outcomes will depend upon the specific situation of the given transaction’s counterparty and may include:

successful provision of advice which mitigates risk for EXIM in light of the Pandemic;

development, presentation, and completion of any agreed upon restructuring documentation or similar projects with EXIM’s transportation division customers; effective representation of EXIM’s interests in connection with any bankruptcy proceeding and/or proposed restructuring; and/or EXIM’s successful repossession, deregistration, export and remarketing of an aircraft or a rail asset or other transportation division or structured financial transaction collateral.

Contractor must be able to respond to work requests without any delay. The need for Services is likely to arise with little, if any warning. Contractor must proceed with alacrity without compromising efficacy. The exact date on which a given transaction could proceed into bankruptcy, receivership or other impaired status is not susceptible to exact prediction. The Contractor must be ready always to accept and carry out work assignments from EXIM.

Constraints: Unexpected challenges and rapidly changing macroeconomic conditions stemming from the evolving and unexpected nature of the COVID crisis.

5.0 APPLICABLE DIRECTIVES

• All services performed under this PWS shall fall within the governance of the Federal Acquisition Regulation (FAR), applicable Bank policies and directives, and Federal law and regulation (such as Privacy Act, Procurement Integrity Act, etc.). It is incumbent upon the Contractor to be knowledgeable of all applicable laws and regulations. Bank policies and directives will be made available to the Contractor upon request.

• Contractor shall become familiar with EXIM’s transportation portfolio, as well as EXIM’s policies and procedures related to the underwriting and documentation of transportation transactions.

• The contractor must handle all material in accordance with the Privacy Act, 5 USC 522a, and the Procurement Integrity Act.

6.0 GOVERNMENT FURNISHED INFORMATION OR PROPERTY

• EXIM shall provide possible remote access to EXIM systems.

• EXIM shall provide the project files to the Contractor, to the extent the Contractor does not already possess them. EXIM shall provide Contractor with any background information necessary to perform Contractor’s Services for EXIM, to the extent Contractor does not already possess such information. EXIM does not anticipate, based on the information currently available to EXIM, that it will need to provide Contractor with any services.

7.0 SPECIFIC REQUIREMENTS/TASKS

• Contractor shall provide a subject matter expert with transportation industry, asset management, and legal experience to provide technical professional support services to TPMD, particularly the VP of TPMD and the Deputy VP.

• The contractor shall obtain knowledge of EXIM’s transportation portfolio to be able to provide the services required obtained through working directly on EXIM transportation transactions.

• The contractor shall analyze and implement the application of protections provided to EXIM Bank by the legal contracts associated with aircraft financings and ongoing monitoring of EXIM’s transportation assets.

o The contractor shall analyze, develop and assist in the implementation of asset protection strategies, including restructuring and/or repossession and remarketing based on the protections provided by the existing participation agreements, inter-creditor agreements, loan agreements, and guarantee agreements, and other ancillary documentation common to aircraft financing structures, including collateral and security documentation, letters of credit, and airframe and engine warranty documentation.

• The contractor shall accept, analyze, process, and make appropriate recommendations for TPMD management relative to critical liquidity relief and transaction modification requests from EXIM Transportation Borrowers.

• The contractor shall assist TPMD management in the implementation of asset protection strategies and shall also when and where applicable, interact with all relevant transaction parties, including, but not limited to:

a. local legal counsel or legal counsel of other parties involved in the transaction,

b. PEFCO, rail, aircraft or engine manufacturers (and/or their related financing affiliates, vehicles, or entities, such as Boeing Capital Corporation),

c. guaranteed lenders,

d. junior or commercial lenders,

e. facility/loan agents,

f. insurers,

g. re-insurers,

h. insurance brokers,

i. indenture trustees,

k. security trustees,

l. bondholders or their representatives or legal counsel,

m. borrowers,

n. operating lessors,

o. airlines,

p. other export credit agencies, or

q. co-financers or joint risk-sharing entities

• The contractor shall assess and mitigate risks in the portfolio and protect the interests of the USG and the US taxpayer.

• The contractor shall assist the Office of Board Authorized Finance (OBAF) staff in its ongoing monitoring and management of the transportation portfolio.

• The contractor shall provide a sophisticated analysis of the financial statements of international airlines and credit and risk analyses of airlines based on industry specific data.

• The contractor shall manage daily post transaction approval and operability legal/documentary closing matters, to include reviewing, recommending and processing all post-closing transaction modifications, including but not limited to amendments, consents, waivers, collateral substitutions, prepayments, and restructurings.

• The contractor shall provide advice to TPMD management relative to leading complex discussions and negotiations with high risk borrowers and possibly other US Government agencies to reduce the likelihood of default on a transaction.

• The contractor shall prepare for advocate for EXIM’s interests in, and, where applicable, help EXIM develop and document the following:

o a. any potential repossession, o b. any export and sale and/or remarketing of the aircraft, engine, locomotive or other relevant EXIM transportation division asset;

o c. any aircraft, engine, locomotive or other relevant transportation division asset inspections, o d. any restructuring (including any related or relevant notification or other requirement which may be required under the Rail Sector Understanding or Aircraft Sector Understanding or other relevant OECD arrangement, document or policy), reorganization or work-out, re-capitalization, payment deferral, any insolvency, bankruptcy or similar legal proceeding (whether in the United States or elsewhere) o e. any default or event of default under any EXIM transaction document, o f. any assignment, termination, amendment (including with respect to the replacement of any interest rate), amendment and restatement, novation, term extension, or other restructuring of the currently existing transaction documents, o g. any new security documentation or filings and any changes required to existing security documentation or filings in connection with any of the Services or transactions contemplated in this PWS, or any changes (or contemplated changes or advice on the necessity thereof) to transportation division documentation in response to any bankruptcy moratorium or stay on enforcements laws.

• The contractor shall provide recommendations to EXIM to interpret, waive, enforce or exercise its rights under, or amend, supplement, assign, novate or terminate, the transaction documents in connection with any of the foregoing scenarios, or any of the Services or transactions contemplated herein, including in the context of any PEFCO transaction or EXIM capital markets transaction.

• The contractor shall assist EXIM with the drafting and/or revising of any memoranda or other documentation necessary or advisable in connection with, or directly or indirectly relating to or arising out of:

a. the Cape Town Convention;

b. the OECD’s Aircraft Sector Understanding;

c. the replacement of the London Inter-Bank Offered Rate (LIBOR), the implementation or interpretation of the secured overnight financing rate (SOFR), and any related guidance issued by the Alternative Reference Rates Committee, ISDA, the LMA, the LSTA, or any other organization or institution;

d. any applicable blocking regulation, sanctions laws, regulations or guidance, or boycott laws (and any related sanctions laws);

e. any applicable administrative, tax, fiscal law, accounting law, regulation or related practice, in each case, whether domestic or international; or

f. any applicable European or UK (to the extent no longer European) or EEA directives, laws or regulations, including those of the individual EU or EEA member states.

• The contractor shall provide recommendations to EXIM on, and assist with drafting/review of documentation in connection with or arising out of:

a. the payment, waiver or potential or partial payment of claims under the EXIM guarantee (and or any related co-financing agreement or risk-sharing arrangement);

or

b. the entry into, waiver, making of any claims, exercise of any rights of remedies, or receipt of any payments under, any sovereign, personal or corporate guarantee;

c. the EXIM bank master guarantee agreement and any related special conditions, Annex B or other related or ancillary documentation.

• The contractor shall work with transactional parties to negotiate and draft or revise transportation division documentation (including, without limitation, any waiver documentation).

• The contractor shall assist with any of the transactions or Services, including, but not limited to, seeking the advice of or guidance or other applicable services from aircraft or rail technicians, aircraft or rail inspectors, aircraft or rail insurance or reinsurance advisers or brokers, aircraft or rail valuation and repossession firms, other relevant technical experts, legal advisers or local law firms in the relevant jurisdictions involved, which may include the United States.

• The contractor shall provide recommendation to EXIM on the implementation, interpretation, drafting, revisions, or review of any laws, policies or procedures related to or in connection with the Services, EXIM, the transactions, any transaction participant, or the Pandemic.

• The contractor shall be required to:

o meet established filing deadlines or other timelines as may be established by third parties (i.e. courts, administrative bodies), or EXIM;

o comply with performance schedules established in writing (unless otherwise agreed to by EXIM in its sole discretion) between OGC’s transportation division and contractor; EXIM will provide any deadlines to the contractor as soon as practicable and the contractor will notify EXIM of any concerns meeting the deadline(s) given for further discussion with EXIM. However, many deadlines may be externally imposed (i.e., filing deadlines, etc.) and therefore may not be adjustable. In these cases, the contractor is expected to meet the deadlines.

o conduct regularly scheduled conference calls with relevant EXIM staff to provide status updates;

o provide EXIM with copies of its (or any subcontractor’s) work product, memoranda or other deliverables requested by EXIM; and o upon EXIM’s request, assist EXIM in communication with or appearances before any applicable court, tribunal, mediator, arbitrator, or any other relevant authority.

• Any or all of the Services may be applicable to and requested by EXIM for any EXIM transportation division transaction of any nature, including any transportation division transaction involving parties other than airlines, such as operating lessor transactions, MRO-related transactions, medium-term or small aircraft program transportation division transactions, or commercial rail transactions or rail infrastructure/logistical support transactions, or other structured financial transactions. As such, EXIM may seek contractor’s expertise to render Services regarding non-aircraft transactions, involving rail, rail infrastructure or any other MRO-related or other complex, structured financial transaction experiencing financial difficulties due to, made worse by or following the COVID-19 global pandemic response.

The contractor shall possess and implement expert level knowledge and experience of the aviation insurance market, capital market financing tools for aircraft financing, and rescheduling and workout situational protocols. For the purposes of this entire document, expert level knowledge would consist of at least 20 years professional experience working with EXIM’s transportation portfolio, documenting EXIM transportation transactions, working within the aviation insurance market, working with capital market financing tools for aircraft financing, and executing on aviation transaction rescheduling and workouts.

• Contractor shall have experience developing, reviewing, and implementing the legal documentation associated with transportation transactions, especially EXIM transportation transactions.

• Contractor shall have experience with asset management concepts and best practices.

• Contractor shall not knowingly or willfully release to any person or entity any portion of documentation provided to them by EXIM, unless acting at EXIM’s request. The contractor is expected to have access to sensitive, confidential, business information and or trade secrets of parties to a given transportation transaction. The contractor shall handle all such information in accordance with applicable federal law and regulations.

8.0 DELIVERABLES

List any reports or documentation that is required as a deliverable to include the frequency, # of copies, and format. A deliverable is anything that can be physically delivered but may include non-physical things such as meeting minutes. Note: All PWS deliverables should be included in this table. Contractor should include in their proposed schedule a time for the Government to review.

Item # Deliverable Section Format/

Quantities Due Date

Progress Reporting Status Report 7 Word Document transmitted via email

9am every Friday

Response to EXIM’s queries

Teleconference and/or email

As needed

Draft/revision documentation

Written report, word document

7 As needed Within 5 business days of identifying need for draft/revision, unless otherwise agreed to by EXIM in its sole discretion.

EXIM will make all reasonable efforts to review documentation submitted and provide comments to the contractor within 5 business days from receipt.

Copies of work product, memoranda or other deliverables requested by

EXIM

Written report, word document, 7 As needed Within 5 business days of identifying need for draft/revision, unless otherwise agreed to by EXIM in its sole discretion.

EXIM will make all reasonable efforts to review documentation submitted and provide comments to the contractor within 5 business days from receipt.

Confirmation filing deadline was met (if applicable)

Written report

7 As needed

Conduct Conference calls Teleconference 7 Teleconference As needed

9.0 PERFORMANCE REQUIREMENT SUMMARY (PRS)

The Contractor service requirements are summarized into performance objectives that relate directly to mission essential items. The performance threshold briefly describes the minimum acceptable levels of service required for each requirement. These thresholds are critical to mission success.

Task or Deliverable

Performance Standard

Acceptable Quality Level

(AQL)

Surveillance Method

Performance Rating

Incentives/ Disincenti ves

Handling critical liquidity relief and transaction modification requests from

EXIM

Transportation Borrowers

Performance rating will be based upon the ability of the Contractor to respond to the request and timeliness of the response.

85% or more of the requests are resolved within established deadlines.

Performance Input received from

TPMD

management based on quality of recommendations and status of requested items.

Review to be performed on a periodic basis depending on the level of requests from EXIM’s borrowers.

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Exceptional (greater than 99%)

Very Good (between 98% and 96%);

Satisfactory (between 93% and 95%)

Marginal (between 91% and 93%

Unsatisfactory (less than 90%).

Positive or negative

CPARS

rating

Coordination with TPMD management and technical advisors, legal counsel, lenders and other ECA’s to assist in implementation of asset protection strategies

Performance rating will be based upon the ability of the Contractor to respond to the request and timeliness of the response.

85% or more of the requests are resolved within established deadlines.

Performance Input received from

TPMD

management based on quality of recommendations and status of requested items.

Review to be performed on a periodic basis depending on the level of requests from EXIM’s borrowers.

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Exceptional (greater than 99%)

Very Good (between 98% and 96%);

Satisfactory (between 93% and 95%)

Marginal (between 91% and 93%

CPARS

rating

Response to EXIM’s queries

Performance rating will be based upon the ability of the Contractor to respond to the request and timeliness of the response.

Regular and ad-hoc meetings or calls between contractor and Government

Surveillance by EXIM COR will be performed as the event occurs.

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Exceptional (greater than 99%)

Very Good (between 98% and 96%);

Satisfactory (between 93% and 95%)

CPARS

rating

Exercise of option

Marginal (between 91% and 93%

Draft/revision documentation

On time All deliverables as described in the PWS and specified in the approved Schedule of Deliverables

100% Inspection

Exceptional Very Good Satisfactory Marginal Unsatisfacto ry

Positive or negative

CPARS

rating

Copies of work product, memoranda or other deliverables requested by

EXIM

On time All deliverables as described in the PWS and specified in the approved Schedule of Deliverables

100% Inspection

Exceptional Very Good Satisfactory Marginal Unsatisfacto ry

Positive or negative

CPARS

rating

Confirmation any applicable filing deadline was met

Performance rating will be based upon the ability of the Contractor to respond to the request and ad-hoc meetings between

EXIM will be performed as the event occurs.

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Exceptional (greater than 99%)

Very Good (between 98% and 96%);

Satisfactory

CPARS

rating and 93%

Conduct Conference calls

Performance rating will be based upon the ability of the Contractor to respond to the request and ad-hoc calls between

EXIM COR will be performed as the event occurs.

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Exceptional (greater than 99%)

Very Good (between 98% and 96%);

Satisfactory (between 93% and 95%)

Marginal (between 91% and 93%

CPARS

rating

Business Relations

Professional and respectful of all parties

Regular and ad-hoc meetings between contractor and Government

Semi-Annual Performance Evaluation

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Positive or negative

CPARS

rating

Management of Key Personnel

Appropriate credentials for the work involved

Attends scheduled meetings as invited

Available for ad-hoc meetings as necessary for contractual concerns

Regular and ad-hoc meetings between borrowers, Government, and contractor as needed

Semi-annual performance evaluation

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Positive or negative

CPARS

rating

Progress Reports

Performance rating will be based upon the ability of the Contractor to respond to the request and timeliness of the response.

85% or more of the reports are provided within established deadlines.

Performance Input received from

TPMD

management based on quality of activities and status of requested items. Review to be performed on a weekly basis.

Exceptional Very Good Satisfactory Marginal Unsatisfactory

Exceptional (greater than 99%)

Very Good (between 98% and 96%);

Satisfactory

CPARS

rating and 93%

Contractor must be able to respond to work requests without any delay. The need for Services is likely to arise with little, if any warning. Contractor must proceed with alacrity without compromising efficacy. The exact date on which a given transacti...