IRREVOCABLE LETTER OF CREDIT
Letter of Credit No. G/LA-400557 August 5, 1997
First Trust of California, National Association
not individually but solely as Trustee
One California Street, Fourth Floor
San Francisco, California 94111
Attention: Corporate Trust Department
Ladies and Gentlemen:
We hereby issue in your favor, not individually, but solely as Trustee
(the "Trustee") under the Indenture of Trust dated as of August 1, 1997 (the
"Indenture") between the California Economic Development Financing Authority
(the "Issuer") and you, this irrevocable direct pay letter of credit (this
"Letter of Credit") in an amount not exceeding $8,625,754 (the "Stated Amount"),
of which an amount not exceeding $8,500,000 may be drawn upon with respect to
the payment of principal of the Issuer's $8,500,000 Variable Rate Demand
Industrial Development Revenue Bonds, Series 1997 (Advanced Aerodynamics and
Structures, Inc. Project) (the "Bonds") and an amount not exceeding $125,754 may
be drawn upon with respect to the payment of up to forty-five (45) days' accrued
interest (at the rate of 12% per annum based on a 365-day year) on the Bonds,
for payment of your draft, drawn at sight on The Sumitomo Bank, Limited, acting
through its Los Angeles Branch (the "Bank"), 777 South Figueroa Street, Suite
2600, Los Angeles, California 90017 (or such other address in the United States
of America as may be designated to you in writing from time to time by the Bank)
accompanied by your signed certificate (with the blanks filled in
appropriately):
1. if the drawing is being made with respect to the payment or
provision for payment of interest on the Bonds, whether for regularly scheduled
interest payments pursuant to Section 2.02 of the Indenture or for accrued
interest on Bonds subject to optional or mandatory redemption pursuant to
Article IV of the Indenture or upon the acceleration of the Bonds pursuant to
Section 7.01 of the Indenture, your certificate in the form attached as Annex I;
2. if the drawing is being made with respect to the payment of
principal upon an optional or mandatory redemption of Bonds pursuant to Article
IV of the Indenture or upon the maturity of the Bonds pursuant to Section 2.02
of the Indenture or upon the acceleration of the Bonds pursuant to Section 7.01
of the Indenture, your certificate in the form attached as Annex II;
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3. if the drawing is made with respect to the payment of the accrued
interest and the principal portion of the purchase price of Bonds tendered or
deemed to have been tendered pursuant to Section 4.06 or Section 4.07 of the
Indenture, your certificate in the form attached as Annex III (any such draft
accompanied by such signed certificate is herein referred to as a "Purchase
Price Draft").
More than one demand for payment may be made under this Letter of
Credit. A demand for payment with respect to the payment of interest on or
principal of the Bonds shall not exceed that portion of the Stated Amount
allocated to interest or principal, respectively, as the same is reduced or
reinstated from time to time as provided below.
The expiration date of this Letter of Credit (the "Expiration Date")
shall be the earliest of: (i) our close of business on August 5, 2002 (the
"Stated Expiration Date"), unless the Stated Expiration Date has been extended
and the Stated Amount adjusted (if appropriate) by an instrument substantially
in the form of Attachment C hereto (which forms an integral part of this Letter
of Credit); (ii) ten (10) days after you receive notice from the Bank of an
Event of Default under (and as defined in) the Reimbursement Agreement dated as.
of August 1, 1997 between Advanced Aerodynamics and Structures, Inc. (the
"Company") and the Bank (the "Reimbursement Agreement") and a direction to cause
a redemption of all outstanding Bonds under the terms of the Indenture; (iii)
the date on which the Bank, receives notice from you that all Bonds have been
paid in full or such payment has been provided for in accordance with the terms
of the Indenture; (iv) the date on which the Bonds become secured by an
Alternate Letter of Credit (as defined in the Indenture) in accordance with the
terms of the Indenture; and (v) the date on which the interest rate on the Bonds
is converted to a fixed rate of interest in accordance with the terms of the
Indenture. You shall surrender this Letter of Credit to the Bank on the
Expiration Date of this Letter of Credit.
A draft and completed signed certificate (other than a Purchase Price
Draft) presented prior to 9:00 a.m., Los Angeles, California time, on any day
except Saturday, Sunday or any day on which banking institutions located, in the
Cities of New York, New York or Los Angeles, California or the city in which the
principal office of the Trustee or the Remarketing Agent (as defined in the
Indenture) is located (initially, San Francisco, California) are required or
authorized by law to close or a day on which the New York Stock Exchange is
closed (a "Business Day") shall be honored and the amount of the draft paid in
immediately available funds by 1:00 p.m., Los Angeles, California time) on the
same Business Day, provided that such draft and signed certificate presented
conform to the terms and conditions of this Letter of Credit. A draft and
completed signed certificate (other than a Purchase Price Draft) presented after
9:00 a.m., Los Angeles, California time on any Business Day shall be honored and
the amount of the draft paid in immediately available funds by 11:00 a.m. Los
Angeles, California time, on the following Business Day, provided that such
draft and signed certificate presented conform to the terms and conditions of
this Letter of Credit. A Purchase Price Draft presented prior to 9:00 a.m., Los
Angeles, California time, on any Business Day shall be honored and the amount of
the draft paid in immediately available funds by 1:00 p.m. Los Angeles,
California time on the same Business Day, provided that such Purchase Price
Draft presented conforms to the terms and conditions of this Letter of Credit. A
Purchase Price Draft presented after
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9:00 a.m., Los Angeles, California time on any Business Day shall be honored and
the amount of the draft paid in immediately available funds by 11:00 a.m., Los
Angeles, California time on the following Business Day, provided that such draft
and signed certificate presented conform to the terms and conditions of this
Letter of Credit. Payment under this Letter of Credit shall be made in
accordance with the payment instructions set forth in the completed certificate
accompanying each draft. All payments made by the Bank under this Letter of
Credit shall be made from the Bank's own funds without any requirement that the
Trustee, the holders of the Bonds or the Bank make any prior claims against the
Company and not out of any funds of the Company, the Issuer or any entity
related to either of them. By the time set forth above on the Business Day such
payment is due the Bank shall enter such payment instructions on the Federal
Reserve wire or, in the event such payment instructions specify an account
maintained with the Bank, credit such account with immediately available funds.
Any draft or certificate may be presented in person to the Bank or may
be sent to the Bank by telecopier or other electronic communication, promptly
confirmed by telephone at (213) 955- 0800, Attention: Manager - Structured
Finance and Financial Institutions Group, to telecopy number (213) 623-6832 (or
such other telecopy or telephone number as may be designated to you in writing
from time to time by the Bank). Any such draft or certificate presented by
telecopy or other electronic communication shall be mailed or delivered to the
Bank on the same day to our office specified in the first paragraph of this
Letter of Credit.
This Letter of Credit is successively transferable only to a successor
paying agent upon receipt by the Bank of prior written notice of such transfer
in accordance with Attachment A (which forms an integral part of this Letter of
Credit), acknowledged by a purported officer of the Trustee and the transferee,
addressed to the Bank and certifying that the transferee is a successor trustee
under the Indenture.
Each payment of a draft with respect to the payment of interest on or
principal of the Bonds honored by the Bank shall. pro Tanto, reduce that portion
of the Stated Amount available under this Letter of Credit. subject to
reinstatement as provided below. Following the honoring of a drawing hereunder
to pay regularly scheduled principal of the Bonds or principal of the Bonds upon
an optional or mandatory redemption of the Bonds, that portion of the Stated
Amount available under this Letter of Credit to pay interest shall also be
reduced to an amount equal to forty-five (45) days' accrued interest (at the
rate of interest of 12% per annum based on a 365-day year) on the principal
amount of the remaining outstanding Bonds (other than Pledged Bonds (as defined
in the Reimbursement Agreement)). In addition, the Stated Amount of this Letter
of Credit shall also be reduced by the amount stated in a written notice of
reduction executed by a purported officer of the Trustee substantially in the
form of Attachment B (which forms an integral part of this Letter of Credit). A
reduction of the Stated Amount through the use of such a written notice of
reduction shall be effective as of the actual date of receipt by the Bank of
such notice at its above-stated address.
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The Stated Amount shall be reinstated as follows:
(a) Following the honoring of a drawing under this Letter of Credit for
the payment of the purchase price of Bonds tendered, or deemed to have been
tendered, to the Trustee or the Tender Agent (as defined in the Indenture)
pursuant to Section 4.06 or Section 4.07 of the Indenture, the Stated Amount
shall be reinstated automatically and immediately upon and to the extent that
you have received payment in immediately available funds of the principal of and
accrued interest on the Pledged Bonds in connection with the remarketing thereof
and are holding such payment for the Bank's sole benefit and account; in such
case, (i) the principal portion of this Letter of Credit shall be reinstated in
an amount equal to the principal amount of the remarketed Bonds and (ii) the
interest portion shall be reinstated to an amount equal to forty-five (45) days'
accrued interest on the Bonds outstanding (other than Pledged Bonds), calculated
at the rate of 12% per annum based on a 365-day year. In connection therewith,
you shall wire transfer such payment to the Bank immediately after receipt
thereof and you shall send to the Bank your telecopy (promptly followed by mail
delivery) notifying the Bank of such payment.
(b) Immediately following the honoring of a drawing hereunder to make a
regularly scheduled interest payment on the Bonds (that is, other than interest
in connection with an optional redemption or mandatory redemption of the Bonds
in whole or in part or an acceleration or optional or mandatory tender of the
Bonds) in an amount set forth in the certificate in the form of Annex I
submitted in conjunction with such drawing, the Bank's obligation hereunder with
respect to the payment of interest on the Bonds will be automatically reinstated
by the amount of such drawing.
(c) The principal and interest portions of the Stated Amount shall
otherwise be reinstated as the Bank may from time to time notify you in writing.
The Sumitomo Bank, Limited acknowledges and agrees, notwithstanding any
terms or provisions of this Letter of Credit or the Reimbursement Agreement to
the contrary, that this Letter of Credit is in all respects an obligation of The
Sumitomo Bank, Limited, binding and enforceable against its properties, assets
and revenues wherever located.
This Letter of Credit shall be governed by the laws of the State of
California including without limitation, Article 5 of the Uniform Commercial
Code as in effect in the State of California, as supplemented by the provisions
(to the extent such provisions are consistent with this Letter of Credit) of the
Uniform Customs and Practice for Documentary Credits (1993 Revision)
International Chamber of Commerce, Publication No. 500 (the "Uniform Customs").
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We undertake that your draft and certificate drawn and presented on or
before the time of expiration of this Letter of Credit in conformity with the
terms of this Letter of Credit will be duly honored.
Very truly yours,
THE SUMITOMO BANK, LIMITED
By:____________________________________
__________________, Los Angeles Branch
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ANNEX I (INTEREST DRAW) to
Transferable Irrevocable Direct Pay Letter of Credit
Issued by The Sumitomo Bank, Limited, acting through its Los Angeles Branch
The Sumitomo Bank, Limited (Los Angeles Branch)
777 South Figueroa Street, Suite 2600
Los Angeles, California 90017
Attention: Manager - Structured Finance and
Financial Institutions Group
Gentlemen:
We refer to Transferable Irrevocable Direct Pay Letter of Credit No.
G/LA-400557 issued in support of the $8,500,000 California Economic Development
Financing Authority Variable Rate Demand Industrial Development Revenue Bonds,
Series 1997 (Advanced Aerodynamics and Structures, Inc. Project) (the "Letter of
Credit"). Terms defined in the Letter of Credit and not otherwise defined herein
shall have the same meanings herein as therein.
1. As the Trustee pursuant to the Indenture, in trust for the owners of
the Bonds, we hereby make demand for payment under the Letter of Credit to pay
or provide for the payment of unpaid interest on such Bonds in connection with
either a regularly scheduled interest payment, an optional redemption, a
mandatory redemption or acceleration of the Bonds. Such Bonds have been duly
authenticated under and in accordance with the Indenture.
2. Interest on the Bonds is now or will under the terms of the
Indenture become due and payable on or prior to the regularly scheduled interest
payment date, maturity date or redemption date of the Bonds and the aggregate
amount required to pay or to provide for the payment of the. same is
$________________ and payment of such amount is hereby demanded.
3. The amount demanded does not exceed the amount available today to be
drawn under the Letter of Credit in respect of the payment of interest on the
Bonds.
4. Upon receipt of the amount demanded under this Letter of Credit, we
will apply the same directly to the payment when due of interest owing on
account of the Bonds.
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5. (Please wire the amount demanded hereunder to account no. __________
at _______________ in __________ [Please credit account no. _____ maintained
with you.]
Dated as of __________ 19__.
First Trust of California, National
Association, not in its individual or
corporate capacity, but solely as
Trustee under the Indenture.
By:_____________________________________
Title:__________________________________
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ANNEX II (PRINCIPAL DRAW) to
Transferable Irrevocable Direct Pay Letter of Credit Issued by The Sumitomo
Bank, Limited, acting through its Los Angeles Branch
The Sumitomo Bank, Limited (Los Angeles Branch)
777 South Figueroa Street, Suite 2600
Los Angeles, California 90017
Attention: Manager - Structured Finance and
Financial Institutions Group
Gentlemen:
We refer to Transferable Irrevocable Direct Pay Letter of Credit No.
G/LA-400557 issued in support of the $8,500,000 California Economic Development
Financing Authority Variable Rate Demand Industrial Development Revenue Bonds,
Series 1997 (Advanced Aerodynamics and Structures, Inc. Project) (the "Letter of
Credit"). Terms defined in the Letter of Credit and not otherwise defined herein
shall have the same meanings herein as therein.
1. As the Trustee pursuant to the Indenture, in trust for the owners of
the Bonds, we hereby make demand for payment under the Letter of Credit to pay
all or a portion of the unpaid principal amount of such Bonds which have been
duly authenticated under and in accordance with the Indenture in connection with
either an optional redemption, a mandatory redemption or upon maturity or
acceleration of the Bonds.
2. Principal on the Bonds is now or will under the terms of the
Indenture become due and payable on or prior to the maturity date or redemption
date of the Bonds; the drawing in the amount of $____________ is being made to
pay the principal portion of each such Bond and payment of such amount is hereby
demanded.
3. The amount demanded does not exceed the amount available on the date
hereof to be drawn under the Letter of Credit in respect of the payment of
principal on the Bonds.
4. Upon receipt of the amount demanded under this Letter of Credit, we
will apply the same directly to the payment of the principal owing on account of
the Bonds.
5. The Stated Amount of the Letter of Credit shall be permanently
reduced by the amount of the draw hereunder.
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6. [Please wire the amount demanded hereunder to account no. __________
at _______________ in __________ [Please credit account no._______ maintained
with you.]
Dated as of __________, 19__.
First Trust of California, National
Association, not in its individual or
corporate capacity, but solely as
Trustee under the Indenture.
By:
Title:
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ANNEX III (PURCHASE PRICE DRAW) to
Transferable Irrevocable Direct Pay Letter of Credit Issued by The Sumitomo
Bank, Limited, acting through its Los Angeles Branch
The Sumitomo Bank, Limited (Los Angeles Branch)
777 South Figueroa Street, Suite 2600
Los Angeles, California 90017
Attention: Manager - Structured Finance and
Financial Institutions Group
Gentlemen:
We refer to Transferable Irrevocable Direct Pay Letter of Credit No.
G/LA-400557 issued in support of the $8,500,000 California Economic Development
Financing Authority Variable Rate Demand Industrial Development Revenue Bonds,
Series 1997 (Advanced Aerodynamics and Structures, Inc. Project) (the "Letter of
Credit"). Terms defined in the Letter of Credit and not otherwise defined herein
shall have the same meanings herein as therein.
1. As the Trustee pursuant to the Indenture, we hereby make demand for
payment under the Letter of Credit to pay a part or all of the interest portion
and the principal portion of the purchase price to be paid in respect of Bonds
which have been duly authenticated under and in accordance with the Indenture
and which have been tendered or were deemed to have been tendered pursuant to
Section 4.06 or Section 4.07 of the Indenture and for which remarketing proceeds
have not been received.
2. The drawing in the aggregate amount of $ _______________ is being
made to pay the purchase price of Bonds which have been tendered or were deemed
to have been tendered. Such aggregate amount equals the sum of the amounts set
forth in paragraphs 3 and 5 below.
3. The portion of the drawing equal to $ _______________ is being made
to pay a part or all of the interest portion of the purchase price of such Bonds
which have been tendered or were deemed to have been tendered and for which
remarketing proceeds have not been received corresponding to the accrued
interest thereon, and payment of such amount is hereby demanded.
4. Upon receipt of the amount set forth under paragraph 3 above, we
will apply the same directly to the payment of a part or all of the interest
portion of the amount to be paid in respect of the Bonds.
5. The portion of the drawing equal to $ _______________ is being made
to pay the principal portion of the purchase price of such Bonds which have been
tendered or were deemed to have been tendered and for which remarketing proceeds
have not been received, and payment of such amount is hereby demanded.
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6. Upon receipt of the amount set forth under paragraph 5 above, we
will apply the same directly to the payment of the principal portion of the
purchase price to be paid in respect of the Bonds.
7. The amount set forth under paragraph 3 above does not exceed the
amount available on the date hereof to be drawn under the Letter of Credit in
respect of the payment of interest on the Bonds and the amount set forth under
paragraph 5 above does not exceed the amount available on the date hereof to be
drawn under the Letter of Credit in respect of the payment of principal on the
Bonds.
8. [Please wire the amount demanded hereunder to account no. __________
at _______________ in __________.] [Please credit account no. __________
maintained with you.]
Dated as of _______________ 19__.
First Trust of California, National
Association, not in its individual or
corporate capacity, but solely as
Trustee under the Indenture.
By:
Title:
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ATTACHMENT A TO TRANSFERABLE IRREVOCABLE
DIRECT PAY LETTER OF CREDIT
(Transfer Certificate)
____________________ 19__
The Sumitomo Bank, Limited (Los Angeles Branch)
777 South Figueroa Street, Suite 2600
Los Angeles, California 90017
Attention: Manager - Structured Finance and
Financial Institutions Group
Gentlemen:
We refer to Transfer-able Irrevocable Direct Pay Letter of Credit No.
G/LA-400557 issued in support of the $8,500,000 California Economic Development
Financing Authority Variable Rate Demand Industrial Development Revenue Bonds,
Series 1997 (Advanced Aerodynamics and Structures, Inc. Project) (the "Letter of
Credit").
The undersigned is the Trustee referred to in the Letter of Credit and
we hereby give you notice that __________ is the successor Trustee (the
"Successor Trustee") under the Indenture referred to in the Letter of Credit,
and that the Successor Trustee shall succeed to all the rights and obligations
of the Trustee under the Letter of Credit.
Upon payment to you of a $2,000 transfer fee by Advanced Aerodynamics
and Structures, Inc., your consent to the transfer of the Letter of Credit with
the date thereof to be confirmed by a
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Notary Public in Japan (or otherwise officially established) pursuant to the
laws of Japan and receipt by us of your acknowledgment and acknowledgment by the
Successor Trustee of this notice, the Letter of Credit shall be deemed to have
been transferred to the Successor Trustee.
Very truly yours,
First Trust of California, National
Association
By:
Title:
Agreed and Accepted: Acknowledged:
The Sumitomo Bank, Limited, [Name of Successor Trustee]
acting through Its
Los Angeles Branch
By:_________________________________ By:
Title:______________________________ Title:
Date:_______________________________ Date:
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ATTACHMENT B TO TRANSFERABLE IRREVOCABLE
DIRECT PAY LETTER OF CREDIT
(Reduction Certificate)
____________________ 19__
The Sumitomo Bank, Limited (Los Angeles Branch)
777 South Figueroa Street, Suite 2600
Los Angeles, California 90017
Attention: Manager - Structured Finance and
Financial Institutions Group
Gentlemen:
We refer to Transferable Irrevocable Direct Pay Letter of Credit No.
G/LA-400557 issued in support of the $8,500,000 California Economic Development
Financing Authority Variable Rate Demand Industrial Development Revenue Bonds,
Series 1997 (Advanced Aerodynamics and Structures, Inc. Project) by
_______________ Dollars ($ __________). This reduction in Stated Amount shall go
to reduce that portion of the Stated Amount allocated to (principal, interest)1/
relating to the Bonds and shall be effective as of the actual date of receipt of
this instrument by The Sumitomo Bank, Limited. Accordingly, the Stated Amount of
the Letter of Credit after giving effect to such reduction shall be
____________________ Dollars ($ _______________). It is acknowledged that the
amount of such reduction shall no longer be available for payment of drafts
under the Letter of Credit. All terms used in this instrument which are defined
in the Letter of Credit shall have the same meaning in this instrument as in the
Letter of Credit.
First Trust of California, National
Association, not in its individual or
corporate capacity, but solely as
Trustee under the Indenture referred to
in the Letter of Credit.
By:
Title:
- --------
1/ Complete as appropriate.
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ATTACHMENT C TO TRANSFERABLE IRREVOCABLE
DIRECT PAY LETTER OF CREDIT
(Notice of Extension)
____________________ 19__
The Sumitomo Bank, Limited (Los Angeles Branch)
777 South Figueroa Street, Suite 2600
Los Angeles, California 90017
Attention: Manager - Structured Finance and
Financial Institutions Group
Gentlemen:
We refer to Transferable Irrevocable Direct Pay Letter of Credit No.
G/LA-400557 issued in support of the $8.500,000 California Economic Development
Financing Authority Variable Rate Demand Industrial Development Revenue Bonds,
Series 1997 (Advanced Aerodynamics and Structures, Inc. Project), in the
original Stated Amount of $8,625,754 (the "Letter of Credit"). We hereby notify
you that, in accordance with the terms of the Letter of Credit and that certain
Reimbursement Agreement dated as of August 1, 1997, between Advanced
Aerodynamics and Structures, Inc. and us, the Stated Expiration Date (as defined
in the Letter of Credit) of the Letter of Credit has been extended to
_______________.
The portions of the Stated Amount of the Letter of Credit available to
pay principal and interest on the Bonds are $ _______________ and $
_______________, respectively, and the Stated Amount is $ _______________.
This letter should be attached to the Letter of Credit and made a part
thereof.
THE SUMITOMO BANK, LIMITED
LOS ANGELES BRANCH
By:
Its:
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