Frustrated with years of legal wrangling, a Delaware judge has given a lender 60 days to decide whether to buy the former presidential yacht Sequoia, which lies rotting in a Virginia shipyard.
The 104-foot Sequoia, built in 1925, is the longest-serving presidential yacht in American history. It was the official yacht for presidents from Herbert Hoover through Jimmy Carter, who had it sold in 1977.
Designated a National Historic Landmark, the vessel has been drying out since December in a Deltaville, Virginia, shipyard amid a legal fight about what it's worth and who should pay for repairs.
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"It is not helpful for a wooden boat to be out of the water this long," Jon Farinholt, chief operating officer of Chesapeake Boat Works, told The Associated Press earlier this year.
"It is a vessel that has a lot of history and a lot of prestige for the United States, and my company wants nothing more than to see this boat back in operation and sailing again," Farinholt added.
The vessel is owned by Sequoia Presidential Yacht Group LLC, led by Washington, D.C.-based lawyer and businessman Gary Silversmith.
In 2012, the Sequoia group entered a USD 7.5 million loan agreement with FE Partners LLC, an investment entity formed by Washington, DC-based Equator Capital Group and members of the Timblo family of India, which has interests in the mining and hospitality industries.
Under default terms of the loan agreement, FE Partners can exercise an option to purchase the yacht for USD 7.8 million. From that amount, FE could deduct the loan amount actually extended to Sequoia, certain attorney fees and expenses, and outstanding and potential liabilities.
Sequoia filed a lawsuit in 2013 seeking to prevent FE Partners from exercising its purchase option, but it later agreed to a default judgment in favor of FE, which alleged that it was fraudulently induced and that Sequoia breached the loan agreement.
Since then, however, FE Partners has refused to exercise its option, which it claims is valid through 2017, to buy either the yacht or the Sequoia LLC.
On Thursday, however, Vice Chancellor Sam Glasscock III gave FE Partners 60 days to decide whether to exercise its purchase option.
