The Huntington National Bank
PO Box 155B
Columbus, Ohio 43216
Direct Telephone Number
614- 480-4893
[LOGO]
February 4, 1997
Mr. Duane Egeland, CFO
Dynacraft Golf Products, Inc.
98 James Street
Newark, OH 43055
Dear Duane:
I am pleased to inform you that The Huntington National Bank (the "Bank") has
approved and is willing to commit to the extension of the following credit
facility for Dynacraft Golf Products, Inc. (the "Borrower"). Please note that
this commitment is subject to the terms and conditions outlined below and the
execution of documentation acceptable to the Bank and its attorneys.
Borrower: Dynacraft Golf Products, Inc.
Co-Borrowers: Pal Joey Custom Golf, Inc.
Diamond Golf International Limited
Guarantors: Joseph A. Altomonte, Sr.
Joseph A. Altomonte, Jr.
Amount and Type: Standby letter of credit up to the lesser of 57,000 BRITISH
POUNDS or $93,OOO. The letter of credit is to be used to
facilitate the acquisition of a loan for Co-Borrower
(Diamond Golf) from Lloyds Bank, the proceeds of which are
to be used to reduce the principal balance on the existing
term note in the original amount of $1,860,315 extended to
Dynacraft Golf Products, Inc.
Advance Rate: The outstanding balance of the letter of credit is to be
added to the "Term Loan Outstanding Balance" for the purpose
of calculating Dynacraft's borrowing certificates.
Commission Rate: One and one half percent (1.50%) per annum, subject to a
minimum annual commission charge of $300.
Repayment Schedule: The commission charge is to be paid semi-annually, and
the balance of the letter of credit is to semi-annually
be reduced by 1/6th of the original amount of the
letter of credit.
Dynacraft Golf Products, Inc.
February 4, 1997
Expiration Date: Three (3) years after closing.
Collateral: Cross-collateralized and cross-defaulted with the existing
term note in the original amount of $1,860,315 extended to
Dynacraft Golf Products, Inc.
Other Fees: The letter of credit will be subject to an issuance fee of
$100. In addition, Borrower is to reimburse HNB for any
other expenses incurred in connection with the documentation
and/or issuance of the proposed letter of credit.
Please note that this commitment will expire and become null and void unless
accepted by the appropriate parties prior to February, 28, 1997. Please indicate
your acceptance by having the appropriate parties sign at the spaces indicated
on the following page and returning this letter to my attention. If this
commitment is allowed to expire, Bank will be under no obligation to renew or
extend it. FOLLOWING THE ACCEPTANCE OF THIS COMMITMENT, BORROWER WILL BE
REQUIRED TO REIMBURSE BANK FOR ANY REASONABLE EXPENSES INCURRED IN CONNECTION
WITH THE DOCUMENTATION OF THIS CREDIT FACILITY EVEN IN THE EVENT THAT THE
TRANSACTION IS NOT CONSUMMATED.
Please contact me at 614-480-4893 with any questions or comments.
Sincerely,
/s/ Thomas Myers
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Thomas Myers
Vice President
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Dynacraft Golf Products, Inc.
February 4, 1997
ACCEPTANCE
I have read this commitment and agree to be bound by its terms and conditions.
BORROWER
Dynacraft Golf Products, Inc.
By:/s/ Joseph Altomonte, Jr. 2/7/97
-------------------------- ------
Joseph Altomonte, Jr., CEO Date
CO-BORROWER
Pal Joey Custom Golf, Inc.
By:/s/ Joseph Altomonte, Jr. 2/7/97
-------------------------- ------
Joseph Altomonte, Jr., President Date
CO-BORROWER
Diamond Golf International Limited
By:/s/ Joseph Altomonte, Jr. 2/7/97
-------------------------- ------
Joseph Altomonte, Jr Date
GUARANTOR
/s/ Joseph Altomonte, Sr. 2/7/97
-------------------------- ------
Joseph Altomonte, Sr. Date
GUARANTOR
/s/ Joseph Altomonte, Jr. 2/7/97
- -------------------------- ------
Joseph Altomonte, Jr. Date
International Division
S.W.I.F.T. Address
HUNTUS33 Telex 245-475
CABLE CONFIRMATION
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The Huntington National Bank
International Operations
41 South High Street
Columbus, OH 43215
Irrevocable Standby Letter of Credit 106884 April 15, 1997
LLOYDS BANK PLC
1 Beach Road
Littlehampton
West Sussex BN17 5HY
England
Beneficiary:
LLOYDS BANK PLC
1 Beach Road
Littlehampton
West Sussex BN17 5HY
England
Gentlemen:
We hereby issue our Irrevocable Standby Letter of Credit 106884
in your favor for the account of DYNACRAFT GOLF PRODUCTS, INC., PAL JOEY CUSTOM,
INC. AND DIAMOND GOLF INTERNATIONAL LTD., 98 JAMES STREET, NEWRK, OH 43055, up
to an aggregate amount of GBP 58,000.00 available by your draft(s) at sight
drawn on The Huntington National Bank Columbus, OH.
Drafts to be accompanied by the following document(s):
+Beneficiary signed statement that Diamond Golf International
Limited has created or caused to be created a
payment default per the terms of an Agreement dated March, 19978
between Beneficiary and Diamond Golf International Limited."
Amount is to be reduced in accordance with the following schedule,
showing amount available for drawing hereunder:
From 4/14/97 to 7/31/97, inclusive 58,000 GBP
From 8/01/97 to 7/31/97, inclusive 53,167 GBP
From 11/01/97 to 1/31/98, inclusive 48,333 GBP
From 2/01/97 to 4/30/98, inclusive 43,500 GBP
From 5/01/97 to 7/31/98, inclusive 38,667 GBP
From 8/01/97 to 10/31/98, inclusive 33,833 GBP
From 11/01/97 to 1/31/99, inclusive 29,000 GBP
From 2/01/97 to 4/30/99, inclusive 24,167 GBP
From 5/01/97 to 7/31/99, inclusive 19,333 GBP
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International Division
S.W.I.F.T. Address
HUNTUS33 Telex 245-475
The Huntington National Bank
International Operations
41 South High Street
Columbus, OH 43215
Irrevocable Standby Letter of Credit 106884 April 15, 1997
From 8/01/97 to 10/31/99, inclusive 14,500 GBP
From 11/01/97 to 1/31/00, inclusive 9,667 GBP
From 2/01/97 to 4/30/00, inclusive 4,833 GBP
Expiration Date - 5/01/00
Claims and reimbursements via Swift/Telex are permitted.
Draft(s) must be marked "Drawn under the Huntington National Bank
Credit No. 106884 dated April 15, 19978.
We hereby agree with you that the drafts drawn under and in
compliance with the terms of this credit will be duly honored by us
upon presentation at the office on or before May 1, 2000.
Except as otherwise expressly stated herein, this letter of
Credit is subject to the uniform Customs and Practices for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication
No. 500,
The Huntington National Bank
/s/ C Simpsom
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Authorized Signature
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