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Exhibit: 10(t)
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LETTER OF CREDIT AGREEMENT
Dated as of November 1, 1997
Between
LESCO, INC.,
an Ohio corporation
and
PNC BANK, NATIONAL ASSOCIATION,
a national banking association
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INDEX
Page
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RECITALS.................................................................. 1
ARTICLE I
DEFINITIONS
Section 1.01. Definitions................................................ 1
Section 1.02. Rules of Construction; Time of Day......................... 4
ARTICLE II
LETTER OF CREDIT AND REIMBURSEMENT
Section 2.01. Issuance of Letter of Credit............................... 4
Section 2.02. Reimbursement and Other Payments........................... 5
Section 2.03. Transfer; Reduction; Reinstatement......................... 7
Section 2.04. Obligations Absolute....................................... 8
Section 2.05. Indemnification............................................ 8
Section 2.06. Liability of Bank.......................................... 8
Section 2.07. Termination of Letter of Credit............................ 9
Section 2.08. Pledged Bonds............................................. 10
ARTICLE III
CONDITIONS PRECEDENT
Section 3.01. Documentation............................................. 11
Section 3.02. Other Conditions.......................................... 12
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Organization. ............................................ 12
Section 4.02. Financial Information..................................... 12
Section 4.03. Taxes, etc................................................ 12
Section 4.04. Compliance with ERISA..................................... 12
Section 4.05. No Violation.............................................. 13
Section 4.06. Bond Documents............................................ 13
(i)
3
Section 4.07. Subsequent Events......................................... 13
Section 4.08. Title to Property......................................... 13
Section 4.09. Litigation................................................ 13
Section 4.10. Authority..................................................14
Section 4.11. No Default................................................ 14
Section 4.12. Tax Exemption............................................. 14
ARTICLE V
GENERAL COVENANTS
Section 5.01. Maintenance of Existence.................................. 14
Section 5.02. Maintenance of Governmental Authorizations............. 14
Section 5.03. Covenants Incorporated by Reference....................... 15
Section 5.04. Compliance with Bond Documents and Other Contracts........ 15
Section 5.05. Consents Under Bond Documents............................. 15
Section 5.06. Amendments to Bond Documents.............................. 15
Section 5.07. Limitation on Optional Calls for Redemption............... 15
Section 5.08. Payment of Debt........................................... 15
Section 5.09. Further Assurances........................................ 15
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. Defaults.................................................. 16
Section 6.02. Remedies.................................................. 16
Section 6.03. Waivers; Consents......................................... 17
Section 6.04. No Waiver; Remedies Cumulative............................ 17
Section 6.05. Set-Off................................................... 17
ARTICLE VII
MISCELLANEOUS
Section 7.01. Notices................................................... 18
Section 7.02. Successors and Assigns.................................... 18
Section 7.03. Survival of Covenants..................................... 18
Section 7.04. Counterparts.............................................. 18
Section 7.05. Costs, Expenses and Taxes................................. 19
Section 7.06. Amendments................................................ 19
Section 7.07. Severability; Interest Limitation......................... 19
Section 7.08. Complete Agreement........................................ 20
Section 7.09. Consent to Jurisdiction; Venue; WAIVER OF JURY TRIAL...... 20
Section 7.10. Governing Law............................................. 20
Section 7.11. Headings.................................................. 20
(ii)
4
Section 7.12. Participation............................................. 20
Exhibit A -- Form of Irrevocable Letter of Credit
(iii)
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LETTER OF CREDIT AGREEMENT
--------------------------
THIS LETTER OF CREDIT AGREEMENT (this "Agreement"), dated as of
November 1, 1997, is entered into between LESCO, INC., a corporation duly
organized and existing under the laws of the State of Ohio (the "Company"), and
PNC BANK, NATIONAL ASSOCIATION, a national banking association duly organized
and existing under the laws of the United States of America (the "Bank"), under
the following circumstances:
RECITALS
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A. The Highlands County Industrial Development Authority (the "Issuer") is
issuing its Industrial Development Revenue Bonds, Series 1997 (LESCO,
Inc. Project) (the "Bonds") in the aggregate principal amount of
$7,500,000 pursuant to an Indenture of Trust, dated as of November 1,
1997 (the "Indenture"), between the Issuer and PNC Bank, National
Association, as trustee (the "Trustee").
B. As security for the repayment of the Bonds, the Company is required to
deliver to the Trustee a letter of credit (the "Letter of Credit") upon
which the Trustee will draw, in accordance with the terms thereof and
the terms of the Indenture, to pay the principal of and interest on the
Bonds.
C. The Bonds are being issued to provide financing for a project
consisting generally of the acquisition, construction and equipping of
a fertilizer blending, formulation and bagging facility located at the
Sebring Regional Airport and Industrial Park in Highlands County,
Florida (the "Project").
NOW, THEREFORE, in consideration of the foregoing and the undertakings
herein set forth and intending to be legally bound, the Company and the Bank
hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. In this Agreement (except as otherwise
expressly provided for or unless the context otherwise requires), the following
terms have the meanings specified in the foregoing recitals:
Agreement Issuer
Bank Letter of Credit
Bonds Project
Company Trustee
Indenture
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All accounting terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles consistently applied.
In addition, the following capitalized terms shall have the respective meanings
specified in this Section 1.01:
"Bank Interest Rate" shall mean a rate per annum (computed based on a
year of three hundred sixty (360) days and actual days elapsed) equal to the
Prime Rate, from time to time in effect, such rate changing automatically from
time to time effective as of the effective date of each change in the Prime
Rate.
"Bond Counsel" shall have the meaning ascribed to that term in Article
I of the Indenture.
"Bond Documents" means the Bonds, the Indenture, the Loan Agreement,
the Remarketing Agreement and any other agreements or instruments relating
thereto.
"Business Day" shall have the meaning ascribed to that term in Article
I of the Indenture.
"Code" means the Internal Revenue Code of 1986, as amended.
"Credit Agreement" means that Credit Agreement, dated as of September
30, 1994, by and among the Company, National City Bank, as Agent, and the Bank,
National City Bank and NBD Bank, N.A., as the lenders thereunder, as amended by
the First Amendment to Credit Agreement, dated as of January 18, 1996, the
Second Amendment to Credit Agreement, dated as of November 1, 1996, the Third
Amendment to Credit Agreement, dated as of February 14, 1997, and the Fourth
Amendment to Credit Agreement, dated as of August 1, 1997. References herein to
sections thereof or defined terms therein shall be to those sections or terms as
in effect on the date hereof, which shall be deemed to be incorporated in this
Agreement by reference as though specifically set forth herein and made with
reference hereto (including, where pertinent, the definitions of defined terms
used in such incorporated sections or in relation to such terms), such
provisions to continue in full force and effect with respect to this Agreement
notwithstanding the payment of all indebtedness due under the Credit Agreement,
any amendment thereto or any waiver given in connection therewith, so long as
this Agreement is in effect and until all amounts payable under this Agreement
are paid in full, it being understood that no amendment or waiver with respect
to the Credit Agreement shall be effective as to this Agreement unless and until
specifically agreed to in writing by the Bank with reference to this Agreement.
The terms "this Agreement", "herein", "hereof" and words of similar purport and
the references to "Note" or "Notes" as used in the Credit Agreement shall be
deemed to refer to this Agreement and the obligations of the Company to the Bank
hereunder, respectively; the term "Event of Default" as used in the Credit
Agreement shall be deemed to refer to an Event of Default as defined in this
Agreement.
"Default Interest Rate" shall have the meaning ascribed to such term in
Section 2.02(b).
"Event of Default" shall have the meaning ascribed to such term in
Section 6.01.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
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"ERISA Affiliate" means (i) any corporation included with the Company
in a controlled group of corporations within the meaning of Section 414(b) of
the Code, (ii) any trade or business (whether or not incorporated or for-profit)
which is under common control with the Company within the meaning of Section
414(c) of the Code, (iii) any member of an affiliated service group of which the
Company is a member within the meaning of Section 414(m) of the Code, and (iv)
any other entity treated as being under common control with the Company under
Section 414(o) of the Code.
"Fiscal Year" means the annual accounting year of the Company, which
currently begins on January 1 and ends on December 31 in each calendar year.
"Interest Component" shall mean the amount available for payment of
Interest Drawings under the Letter of Credit.
"Interest Drawing" shall mean a "C Drawing" as that term is used in the
Letter of Credit.
"Loan Agreement" means the Loan Agreement, dated as of November 1,
1997, between the Issuer and the Company.
"Outstanding" or "Bonds Outstanding" when applied to the Bonds shall
have the meaning ascribed to such term in Article I of the Indenture.
"Participating Banks" shall have the meaning ascribed to such term in
Section 7.12.
"Person" means any individual, for-profit or not-for-profit
corporation, partnership, limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Plan" means any employee pension plan maintained by the Company or any
of its ERISA Affiliates.
"Prime Rate" means the rate of interest publicly announced by the Bank
from time to time as the prime rate of the Bank, adjusted as of the date of any
change in such prime rate. The prime rate is determined from time to time by the
Bank as a means of pricing some loans to its borrowers and neither is tied to
any external rate of interest or index, nor necessarily reflects the lowest rate
of interest actually charged by the Bank to any particular class or category of
customers.
"Principal Component" means the amount available for the payment of
Principal Drawings under the Letter of Credit.
"Principal Drawing" shall mean a "B Drawing" as that term is used in
the Letter of Credit.
"Project Facilities" means the Project, the site of the Project and any
personal property located thereon whether now or in the future.
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"Remarketing Agreement" means the Remarketing Agreement, dated as of
November 1, 1997, between PNC Capital Markets, Inc. (the "Remarketing Agent")
and the Company.
"State" means the State of Ohio.
"Stated Amount" means the Stated Amount of the Letter of Credit as
provided in Section 2.01 hereof, which may be reduced from time to time as
provided in Section 2.03(b) hereof or by the terms of the Letter of Credit.
"Tender Draft" shall mean an "A Drawing" as that term is used in the
Letter of Credit.
"Termination Date" means the date on which the Trustee's right to draw
under the Letter of Credit terminates, determined as provided by the Letter of
Credit.
"Unremarketed Tendered Bonds" means Bonds which (a) have been delivered
for purchase pursuant to the provisions of such Bonds and the Indenture and (b)
have not been successfully remarketed by the Remarketing Agent prior to 10:00
a.m. on the required purchase date.
Section 1.02. RULES OF CONSTRUCTION; TIME OF DAY. In this Agreement,
unless otherwise indicated, (i) defined terms may be used in the singular or the
plural and the use of any gender includes all genders, (ii) the words "hereof ",
"herein", "hereto", "hereby" and "hereunder" refer to this entire Agreement, and
(iii) all references to particular Articles or Sections are references to the
Articles or Sections of this Agreement. References to any time of the day in
this Agreement shall refer to Eastern Standard Time or Eastern Daylight Saving
Time, as in effect in Pittsburgh, Pennsylvania on such day.
ARTICLE II
LETTER OF CREDIT AND REIMBURSEMENT
SECTION 2.01. ISSUANCE OF LETTER OF CREDIT. The Company hereby requests
the Bank to issue the Letter of Credit to the Trustee. Subject to the conditions
precedent hereinafter set forth, the Bank will issue to the Trustee pursuant to
the request of the Company, on the date of execution and delivery of this
Agreement, the Letter of Credit substantially in the form attached hereto as
EXHIBIT A and in an aggregate amount, the "Stated Amount", of $7,726,027.40, of
which (a) an amount not exceeding $7,500,000 may be drawn upon with respect to
the payment of the principal portion of the Bonds at their stated maturity, upon
redemption or upon acceleration pursuant to the Indenture, and (b) an amount not
exceeding $226,027.40 may be drawn upon with respect to the payment of up to 110
days' accrued interest on the Bonds, computed as though the Bonds bore interest
at the rate of ten percent (10%) per annum on the basis of a 365/366-day year,
notwithstanding the actual rate borne from time to time by the Bonds. The Letter
of Credit shall expire on the Termination Date of the Letter of Credit.
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Section 2.02. Reimbursement and Other Payments.
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(A) REIMBURSEMENT PAYMENTS AND INTEREST. The Company hereby
agrees to pay or to cause to be paid to the Bank:
(1) a sum equal to each amount drawn under the Letter of
Credit by a Principal Drawing or an Interest Drawing on the same Business Day
that such drawing is honored, but not before the drawing is honored.
(2) a sum equal to each amount drawn against the Principal
Component by a Tender Draft, on or before the first to occur of (i) the date on
which the Bonds purchased with the proceeds of such Tender Draft are remarketed
by the Remarketing Agent, (ii) the date on which the Bonds purchased with the
proceeds of such Tender Draft are redeemed or otherwise paid in full, or (iii)
the Termination Date.
Subject to Section 2.02(b) hereof, all sums payable to the Bank under
Section 2.02(a)(1) or under any other provision of this Agreement shall bear
interest at the Bank Interest Rate, and all sums payable to the Bank under
Section 2.02(a)(2) shall bear interest at the rate and at the times set forth in
the Credit Agreement, until such sums have been paid in full (it being
understood and agreed that any sum paid by the Company to the Bank prior to 3:00
p.m. on a Business Day shall not bear interest for such Business Day and any sum
paid by the Company to the Bank after 3:00 p.m. on a Business Day shall bear
interest as if it was paid at 9:00 a.m. on the next following Business Day).
Except as the Bank may otherwise elect, all payments by or on behalf of the
Company under this Section 2.02(a) shall be applied first to the payment of
interest and then to the payment of principal.
(b) DEFAULT INTEREST RATE; LATE CHARGES. If any sum or interest thereon
is not paid within fifteen (15) days following the date such payment is due and
payable under Section 2.02(a) or any other provision of this Agreement, such sum
or interest thereon shall bear interest at a rate per annum equal to two percent
(2%) above the Bank Interest Rate (the "Default Interest Rate") until such sum
or interest thereon and all other amounts due and payable under this Agreement
are paid in full. In addition, the Company shall, upon demand by the Bank, pay
to the Bank a late payment charge equal to the lesser of $50 or five percent
(5%) of the amount of any payment due and payable under Section 2.02(a), whether
principal, interest or otherwise, or any other payment due and payable under
this Agreement, which is not received within 15 days following the date such
payment is due.
(c) COMMITMENT FEES. The Company shall pay to the Bank an annual,
non-refundable Letter of Credit fee in an amount equal to .75% of the Stated
Amount of the Letter of Credit for the first two years the Letter of Credit is
in effect, and thereafter in an amount equal to the Margin, as defined in and
determined pursuant to Section 2B.12 of the Credit Agreement. Such Letter of
Credit fee shall be payable quarterly in advance, the first such payment to be
made on the date of issuance of the Letter of Credit and quarterly thereafter
through the Termination Date, commencing March 1, 1998. The Letter of Credit fee
shall be computed on the Stated Amount of the Letter of Credit in effect,
including any amounts which are reinstatable on the date the Letter of Credit
fee is payable. If the Termination Date shall occur prior to the stated
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Expiration Date set forth in the Letter of Credit, the Company shall have no
obligation to pay a Letter of Credit fee after the Termination Date.
(D) TRANSACTION AND TRANSFER CHARGES AND EXPENSES. The Company shall
pay to the Bank all reasonable transaction charges that the Bank may make for
drawings under the Letter of Credit (which the Bank represents is currently $75
per draw). Such transaction charges shall be payable upon submission to the
Company by the Bank of the Bank's bill therefor. In addition, the Company shall
pay to the Bank on demand any and all reasonable charges and expenses which the
Bank may pay or incur relative to the Letter of Credit. The Company shall pay to
the Bank upon each transfer of the Letter of Credit in accordance with its terms
a transfer fee equal to $1,000, together with any and all out-of-pocket costs
and expenses of the Bank incurred in connection with such transfer.
(E) INCREASED COSTS.
(1) If after the date of this Agreement any enactment,
promulgation or adoption of or change in any applicable foreign or domestic law,
treaty, regulation or rule or in the interpretation or administration thereof by
any court, administrative or governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Bank with any guideline, request or directive issued after the date
hereof (whether or not having the force of law) of any such authority, central
bank or comparable agency, or any change in generally accepted accounting
principles, shall either (i) impose, modify or deem applicable any reserve,
special deposit, capital, insurance assessment or similar requirement (including
without limitation a guideline, request or directive which affects the manner in
which the Bank allocates capital resources to its commitments, including its
obligations under this Agreement and the Letter of Credit), (ii) subject the
Bank to any tax, deduction or withholding or change the basis of taxation of the
Bank (other than a change in a rate of tax based on overall net income of the
Bank), (iii) cause or deem letters of credit to be assets held by the Bank
and/or deposits on its books, or (iv) impose on the Bank any other condition
regarding this Agreement or the Letter of Credit, and the result of any event
referred to in clause (i), (ii), (iii) or (iv) of this sentence shall be to
increase the direct or indirect cost to the Bank of issuing or maintaining the
Letter of Credit or the Bank's obligations under this Agreement or to reduce the
amounts receivable by the Bank hereunder or to reduce the rate of return on the
capital of the Bank in connection with this Agreement (which increase in cost,
reduction in amounts receivable or reduction in rate of return shall be
determined by the Bank's reasonable allocation of such cost increase or
reduction in amounts receivable resulting from such event) (in each case, if
applicable, as if there were no Participating Bank), then within 30 calendar
days after demand by the Bank, the Company shall pay to the Bank, from time to
time as specified by the Bank, additional amounts that in the aggregate shall be
sufficient to compensate the Bank for such increased cost, reduction in amounts
receivable or reduction in rate of return. A certificate as to such increased
cost, reduction in amounts receivable or reduction in rate of return by the Bank
submitted by the Bank to the Company shall, if made reasonably and in good
faith, be conclusive and binding for all purposes.
(2) If after the date of this Agreement any enactment,
promulgation or adoption of or change in any applicable law, treaty, regulation,
rule or guideline regarding capital
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adequacy, or in the interpretation or administration thereof, by any
administrative or governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by the
Bank (or any controlling affiliate) with any guideline, request or directive
regarding capital adequacy (whether or not having the force of law and whether
or not failure to comply thereunder would be unlawful) of any such authority,
central bank or comparable agency, or any change in generally accepted
accounting principles, affects or would affect the amount of capital required or
expected to be maintained by the Bank (or any controlling affiliate) and the
Bank determines, on the basis of reasonable allocations, that the amount of such
capital is increased by or is based on its issuance or maintenance of the Letter
of Credit or the Bank's obligations under this Agreement, then, within 30
calendar days after demand by the Bank, the Company shall pay to the Bank, from
time to time as specified by the Bank, additional amounts sufficient to
compensate the Bank therefor. A certificate as to such additional amounts
submitted to the Company by the Bank shall, if made reasonably and in good
faith, be conclusive and binding for all purposes.
(f) PLACE OF PAYMENT. All payments by the Company to the Bank under
this Agreement shall be made in lawful currency (or, as applicable, as otherwise
specified in this Section 2.02(f)) of the United States at the Bank's office at
P.O. Box 340777, Pittsburgh, Pennsylvania 15230-7777, Attention: Commercial Loan
Operations, or at such other address and to the attention of such other person
as the Bank may stipulate by written notice to the Company, or by a wire
transfer in immediately available federal funds from the Company to the Bank in
accordance with written wire instructions given to the Company by the Bank. All
payments under Section 2.02(a) shall be made in immediately available federal
funds.
(g) SOURCE OF PAYMENTS. All payments of drafts under the Letter of
Credit will be made from moneys of the Bank and not of any other person.
Section 2.03. TRANSFER; REDUCTION; REINSTATEMENT.
(a) TRANSFER. The Letter of Credit may be transferred in accordance
with terms of the Letter of Credit.
(b) REDUCTION. The Stated Amount of the Letter of Credit and the
Principal Component and Interest Component thereof shall be automatically
reduced as specified in the Letter of Credit.
(c) REINSTATEMENT. If the Trustee shall not have received, within ten
(10) Business Days after any payment in respect of any "C Drawing," as that term
is used in the Letter of Credit, notice from the Bank that the Bank has not been
reimbursed for such drawing or a previous or subsequent drawing in accordance
with this Agreement, or that an Event of Default under this Agreement has
occurred and is continuing, the Interest Component will automatically be
reinstated, as of the close of business on such tenth business day, to an amount
equal to 110 days' interest (computed at the rate of 10 percent per annum and on
the basis of a 365/366-day year, notwithstanding the actual rate borne from time
to time by the Bonds) on the then applicable Principal Component.
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Section 2.04. OBLIGATIONS ABSOLUTE. The obligations of the Company
under this Article shall be absolute, unconditional and irrevocable, and shall
be performed strictly in accordance with the terms of this Agreement, under all
circumstances whatsoever, including without limitation the following
circumstances: (i) any lack of validity or enforceability of the Letter of
Credit, the Bond Documents or any other agreement or document relating thereto;
(ii) any amendment or waiver of or any consent to or departure from the Letter
of Credit, the Bond Documents or any document relating thereto; (iii) the
existence of any claim, set-off, defense or other right which the Company may
have at any time against the Trustee (or any persons or entities for whom the
Trustee may be acting), the Bank or any other person or entity, whether in
connection with this Agreement, the transactions described herein or any
unrelated transaction; or (iv) any of the circumstances contemplated in clauses
(1) through (7), inclusive, of Section 2.06(a). The Company understands and
agrees that no payment by the Company under any other agreement (whether
voluntary or otherwise) shall constitute a defense to its obligations hereunder,
except to the extent that the Bank has been indefeasibly paid in full.
Section 2.05. INDEMNIFICATION. To the extent permitted by applicable
law, the Company hereby indemnifies and holds harmless the Bank (and its
directors, officers, employees and agents) from and against any and all claims,
damages, losses, liabilities, costs or expenses (including reasonable attorneys'
fees or counsel of the Bank's choice) whatsoever which the Bank may incur (or
which may be claimed against the Bank by any person or entity whatsoever) by
reason of or in connection with (a) the issuance or a transfer of, or payment or
failure to pay under, the Letter of Credit, (b) any breach by the Company of any
representation, warranty, covenant, term or condition in, or the occurrence of
any default under, this Agreement or the Bond Documents, including all
reasonable fees or expenses resulting from the settlement or defense of any
claims or liabilities arising as a result of any such breach or default, and (c)
involvement of the Bank in any suit, investigation, proceeding, inquiry or
action as a consequence, direct or indirect, of the Bank's issuance of the
Letter of Credit, its entering into this Agreement or any other event or
transaction contemplated by any of the foregoing; provided the Company shall not
be required to indemnify the Bank for any claims, damages, losses, liabilities,
costs or expenses to the extent, but only to the extent, caused by (i) the
willful misconduct or gross negligence of the Bank or (ii) the Bank's willful
failure to pay under the Letter of Credit after the presentation to the Bank by
the Trustee of a draft and certificate strictly complying with the terms and
conditions of the Letter of Credit, unless the Bank in good faith believes that
it is prohibited by law or other legal authority from making such payment;
provided, further, that the Bank shall not settle any claim without the prior
written consent of the Company, which consent will not be unreasonably withheld.
Nothing in this Section is intended to or shall limit the Company's
reimbursement obligations contained in Section 2.02(a). The obligations of the
Company under this Section shall survive the termination of this Agreement.
Section 2.06. Liability of Bank.
------------------
(a) As between the Company and the Bank, the Company assumes all risks
of the acts or omissions of the Trustee with respect to the Trustee's use of the
Letter of Credit. Neither the Bank nor any of its officers or directors shall be
liable or responsible for: (1) the use which may be made of the Letter of Credit
or for any acts or omissions of the Trustee in connection therewith; (2) the
form, validity, sufficiency, accuracy or genuineness of any documents
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(including without limitation any documents presented under the Letter of
Credit), or of any statement therein or endorsement thereon, even if any such
documents, statements or endorsements should in fact prove to be in any or all
respects invalid, insufficient, fraudulent, forged, inaccurate or untrue; (3)
the payment by the Bank to the Trustee against presentation of documents which
do not comply with the terms of the Letter of Credit, including failure of any
documents to bear any reference or adequate reference to the Letter of Credit,
or any other failure by the Trustee to comply fully with conditions required in
order to effect a drawing under the Letter of Credit; (4) the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign the Letter of Credit or the rights or benefit thereunder or
proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason; (5) errors, omissions, interruptions, losses or
delays in transmission or delivery of any drafts or any messages by mail, cable,
telegraph, telex, telephone, electronic media or otherwise; (6) any loss or
delay in the transmission or otherwise of any document or draft required in
order to make a drawing under the Letter of Credit; or (7) any other
circumstances whatsoever in making or failing to make payment under the Letter
of Credit; except only that the Company shall have a claim against the Bank, and
the Bank shall be liable to the Company, to the extent, but only to the extent,
of any direct, as opposed to consequential, damages suffered by the Company
which the Company proves were caused by (i) the Bank's willful misconduct or
gross negligence or (ii) the Bank's willful failure to pay under the Letter of
Credit after the presentation to it by the Trustee of a draft and certificate
strictly complying with the terms and conditions of the Letter of Credit, unless
the Bank in good faith believes that it is prohibited by law or other legal
authority from making such payment. The Bank shall have no obligation to contest
any such prohibition. In furtherance and not in limitation of the foregoing, the
Bank may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary.
(b) Except for the Bank's obligations under the Letter of Credit, the
Bank shall have no liability to the Company or any other person as a result of
any reduction of the credit rating of the Bank or any deterioration in the
Bank's financial condition and the Company hereby indemnifies and holds harmless
the Bank from any and all claims, damages, losses, liabilities, costs or
expenses relating to the Company or the Bonds which the Bank may incur in
connection therewith. No reduction of the credit rating of the Bank or
deterioration in the Bank's financial condition shall reduce or in any way
diminish the obligations of the Company to the Bank under this Agreement
including, without limitation, the Company's obligation to pay Letter of Credit
commitment fees to the Bank and to reimburse the Bank for any drawing under the
Letter of Credit.
Section 2.07. TERMINATION OF LETTER OF CREDIT. The termination of the
Letter of Credit shall be governed by the terms thereof. In connection with any
termination, the Bank will refund on a pro-rata basis any annual Letter of
Credit fee paid by the Company for the period between the Termination Date and
the stated Expiration Date as set forth in the Letter of Credit or any amendment
or extension thereof. The Bank shall have no obligation to execute or deliver
any document or instrument in connection with the termination of the Letter of
Credit except for assignment(s) of any applicable Bond Document, in a form
reasonably approved by the Bank. The Company will pay the reasonable
out-of-pocket costs and expenses incurred by the Bank in connection with any
such execution and delivery.
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Section 2.08 Pledged Bonds.
--------------
(a) PLEDGE. To secure the Company's obligations to the Bank under this
Agreement, the Company hereby pledges and assigns to the Bank, and grants to the
Bank a security interest in, all of the Company's right, title and interest, now
owned or hereafter acquired, in and to any and all Unremarketed Tendered Bonds
(together with all income therefrom and proceeds thereof) purchased pursuant to
the Indenture with the proceeds of a Tender Draft presented under the Letter of
Credit for which neither (i) full reimbursement has been made to the Bank nor
(ii) the Trustee holds sufficient funds which, pursuant to the Indenture, the
Trustee is required to apply on behalf of the Company to reimburse the Bank in
full for such Tender Draft on the date such Tender Draft is paid by the Bank.
Such Unremarketed Tendered Bonds purchased pursuant to the Indenture with the
proceeds of a Tender Draft shall be pledged to the Bank, registered in its name
as pledgee of the Company and delivered to and held by the Trustee, or upon the
written request of the Bank as provided in Section 4.06(b) of the Indenture,
delivered to and held by the Bank. Unremarketed Tendered Bonds which are so
pledged and held by the Trustee, as agent for the Bank , or by the Bank are
herein referred to as "Pledged Bonds".
(b) PLEDGED BOND PAYMENTS. Any principal of, interest and premium on
Pledged Bonds which becomes due and payable shall be paid to the Bank. All sums
of money so paid to the Bank in respect of Pledged Bonds shall be credited
against the obligation of the Company to reimburse the Bank, with interest,
under Section 2.02(a) for the amount drawn with a Tender Draft to fund the
purchase of such Pledged Bonds pursuant to the Indenture.
(c) RELEASE OF PLEDGED BONDS. If the Company pays or causes to be paid
in full its obligation under Section 2.02(a) for the reimbursement of the amount
(or allocable portion thereof) drawn with a Tender Draft to fund the purchase of
Pledged Bonds pursuant to Article IV of the Indenture (or if the Trustee has
received immediately available funds which, pursuant to Section 4.07 of the
Indenture, the Trustee is required to pay over promptly to the Bank in an amount
sufficient to pay the Company's reimbursement obligation under Section 2.02(a)
with respect to the amount drawn with such Tender Draft to fund the purchase of
such Pledged Bonds), and provided no Event of Default has occurred and is
continuing, the Bank will release from the pledge of this Agreement and will
deliver, or cause its agent to deliver, such Pledged Bonds to such person or
persons as the Trustee or the Company may direct. An amount equal to the
principal of, plus accrued interest on, such Pledged Bonds shall be presumed
(absent notice to the contrary) to be an "amount sufficient" for purposes of
this Section 2.08 and, upon receipt of such amount by the Trustee for payment to
the Bank as aforesaid, the Trustee shall be automatically authorized to deliver
such Pledged Bonds as aforesaid free from the pledge of this Agreement, unless
the Trustee has received from the Bank written notice or telephonic notice
(which shall thereafter be confirmed in writing) that an Event of Default has
occurred and is continuing and that such release shall not occur.
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ARTICLE III
CONDITIONS PRECEDENT
Section 3.01. DOCUMENTATION. It shall be a condition precedent to the
Bank's issuance of the Letter of Credit that:
(a) The Bank shall have received on or before the date of issuance of
the Letter of Credit the following in form and substance satisfactory to the
Bank:
(i) Opinion of Baker & Hostetler, as counsel to the Company;
(ii) Opinion of Carlton Fields, as Bond Counsel, together with
a reliance letter addressed to the Bank;
(iii) Executed copies of this Agreement;
(iv) Such other documents, instruments, approvals (and, if
required by the Bank, certified duplicates of executed copies thereof)
and opinions as the Bank may request;
(v) Payment in full of the Letter of Credit fee due on the
date of issuance pursuant to Section 2.02(c) hereof and payments for
any costs and expenses incurred by the Bank which are to be reimbursed
pursuant to Section 7.05 hereof; and
(vi) Evidence satisfactory to the Bank that the conditions set
forth in Section 2.06 of the Indenture have been satisfied.
(b) On the date of issuance of the Letter of Credit, this Agreement and
the Bond Documents shall be in full force and effect.
(c) The following statement shall be true and correct on the date of
the issuance of the Letter of Credit and the Bank shall have received a
certificate signed by a duly authorized officer of the Company, stating that:
(i) The representations and warranties contained in Article IV
hereof are correct on and as of the date of the issuance of the Letter
of Credit as though made on and as of such date;
(ii) No Event of Default has occurred or is continuing, or
would result from the issuance of the Letter of Credit or the Company's
execution of this Agreement; and
(iii) No Event of Default has occurred or is continuing under
the Credit Agreement.
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Section 3.02. OTHER CONDITIONS. In addition to the conditions set forth
in Section 3.01 hereof, all of the conditions required to be satisfied in the
Closing Checklist of the Bank shall have been satisfied prior to the Bank's
issuance of the Letter of Credit.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants as follows:
Section 4.01. ORGANIZATION. The Company is duly organized, validly
existing and in good standing as a corporation under the laws of the State and
is qualified to do business as a foreign corporation under the laws of the State
of Florida and in any other jurisdiction where the failure to so qualify could
reasonably be expected to have a material adverse effect on the business or
financial condition of the Company.
Section 4.02. FINANCIAL INFORMATION. It has furnished to the Bank (i)
the statement of financial condition of the Company and of such companies as
were then its subsidiaries as of December 31, 1996, and the related statements
of net earnings and retained earnings for the year then ended, accompanied by
the report on examination thereof by the Company's independent certified public
accountants, and (ii) unaudited statements of financial condition of the Company
and of such companies as were then its subsidiaries as of June 30, 1997, and
related statements of net earnings for the periods then ended; said statements
fairly present the financial condition of the Company and the pertinent
subsidiaries and the results of their operations for the respective periods then
ended, subject, in the case of statements dated June 30, 1997, to normal
year-end audit adjustments.
Section 4.03. TAXES, ETC. Except as are being contested in good faith
by appropriate proceedings for which adequate reserves are being maintained in
accordance with generally accepted accounting principles, all material taxes,
assessments, fees and other governmental charges (other than those presently
payable without penalty or interest) upon the Company and its subsidiaries or
upon any property thereof, which are due and payable, have been paid and no
material claims are being asserted with respect to any past due taxes,
assessments, fees or other governmental charges against the Company or any of
its subsidiaries.
Section 4.04. COMPLIANCE WITH ERISA. With respect to each Plan, the
following are true, except where the failure of any representation or warranty
to be true would not have a material adverse effect on the Company's business,
properties, assets or financial condition: Each Plan is in substantial
compliance with ERISA and the Code; no reportable event (as defined in Section
4043 of ERISA) has occurred with respect to a Plan; no Plan is insolvent or in
reorganization; no Plan which is a single-employer plan (as defined in Section
4001(a)(15) of ERISA) has an unfunded current liability; and no Plan has an
accumulated or waived funding deficiency or permitted decreases in its funding
standard account within the meaning of Section 412 of the Code; all
contributions required to be made with respect to a Plan have been timely made;
neither the Company nor any ERISA Affiliate has incurred any liability to or on
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account of a Plan pursuant to Section 515, 4062, 4063, 4064, 4069, 4201, 4204 or
4212 of ERISA or expects to incur any liability (including any contingent or
secondary liability) under any of the foregoing Sections with respect to any
Plan; no proceedings have been instituted to terminate or appoint a trustee to
administer any Plan; no condition exists which presents a risk to the Company or
any ERISA Affiliate of incurring a liability to or on account of a Plan pursuant
to the foregoing provisions of ERISA and the Code; no lien imposed under the
Code or ERISA on the assets of the Company or any ERISA Affiliate exists or is
likely to arise on account of any Plan; and the Company and its ERISA Affiliates
may cease contributions to or terminate any Plan maintained by any of them
without incurring any liability.
Section 4.05. NO VIOLATION. The execution, delivery and performance of
this Agreement and each of the Bond Documents to which the Company is a party
will not violate any provision of applicable law or of the Company's articles of
incorporation or code of regulations and will not result in a breach of any of
the terms and conditions of or result in the imposition of any lien, charge or
encumbrance upon any property of the Company pursuant to, or constitute a
default under, any indenture or other agreement or instrument under which the
Company is a party or is obligated, the Company's articles of incorporation or
code of regulations or any law, order, rule, regulation, writ, injunction or
decree of any government, governmental instrumentality or court having
jurisdiction over the Company or its property. All acts, things and conditions
required by law and by the Company's articles of incorporation or code of
regulations to make this Agreement and each of the Bond Documents to which the
Company is a party, when executed and delivered, the legal, valid and binding
obligation of the Company will have been duly performed and complied with at or
prior to the execution and delivery of this Agreement.
Section 4.06. BOND DOCUMENTS. The Company makes each of the
representations and warranties contained in the Bond Documents to which the
Company is a party to, and for the benefit of, the Bank as if the same were set
forth in full herein.
Section 4.07. SUBSEQUENT EVENTS. Since the date of the financial
statements specified in Section 4.02 above, the Company has not suffered any
damage, destruction or loss which has materially adversely affected its business
or assets, and no event or condition of any character has occurred which has
materially adversely affected its assets, liabilities, business or financial
condition, and the Company has no knowledge of any event or condition which may
reasonably be expected to materially adversely affect the assets, liabilities,
business or financial condition of the Company.
Section 4.08. TITLE TO PROPERTY. The Company has good and marketable
title to the assets reflected on the balance sheet or notes thereon referred to
in Section 4.02 above, free and clear from all liens and encumbrances, except
for current taxes and assessments not yet due and payable, liens and
encumbrances, if any, reflected or noted on said balance sheet or notes and
security interests referred to herein or permitted by the Credit Agreement, and
except for assets disposed of by the Company in the ordinary course of business
since the date of the financial statements specified in Section 4.02 above.
Section 4.09. LITIGATION. As of the date hereof there are no actions,
suits, proceedings or governmental investigations pending or, to the knowledge
of the Company, threatened against
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the Company which could reasonably be expected to result in a material adverse
change in the financial condition, business, property or assets of the Company
and there is no basis known to the Company for any such action, suit, proceeding
or investigation.
Section 4.10. AUTHORITY. The Company has full corporate power and
authority to enter into the transactions provided for in this Agreement and has
been duly authorized to do so by appropriate action of its board of directors,
and the Bond Documents and this Agreement, when executed and delivered by the
Company, will constitute the legal, valid and binding obligations of the Company
enforceable in accordance with their terms.
Section 4.11. NO DEFAULT. The Company is not, in any material way, in
noncompliance with, breach of or in default under (a) any applicable law or
administrative regulation of the United States, the State or any other
governmental body or agency or instrumentality thereof or any applicable
judgment, order or decree, that would, individually or in the aggregate, have a
material adverse effect on the Company's business, properties, assets or
financial condition, or (b) the Bond Documents, this Agreement or any other
credit agreement, indenture, mortgage, agreement or other instrument to which it
is a party or otherwise subject, and no event has occurred and is continuing
which, with the passage of time or the giving of notice or both, would
constitute an event of default under any such instrument.
Section 4.12. TAX EXEMPTION. The Company has not taken any action or
omitted to take any action which would cause interest on the Bonds to be
includable in the gross income of any bondholder for federal income tax
purposes.
ARTICLE V
GENERAL COVENANTS
So long as any amount is available under the Letter of Credit or any
amount is due and owing to the Bank hereunder, the Company covenants that,
except to the extent the Bank shall otherwise consent in writing, each of the
following covenants shall be performed and complied with by the Company as
indicated:
Section 5.01. MAINTENANCE OF EXISTENCE. The Company shall maintain its
existence, rights and privileges as a corporation duly organized, validly
existing and in good standing under the laws of the State and will qualify or
remain qualified as a foreign corporation to do business in the State of Florida
and in any other jurisdiction where the failure to so qualify could reasonably
be expected to have a material adverse effect on the Company's business,
operations, properties, assets, condition (financial or otherwise) or prospects.
Section 5.02. MAINTENANCE OF GOVERNMENTAL AUTHORIZATIONS. The Company
will maintain in full force and effect all of its governmental and other
authorizations, approvals, consents, permits, licenses, certifications and
qualifications necessary for the conduct of its business as it is presently
being conducted and the ownership and operation of its facilities as they are
presently being operated where the failure to do so, individually or in the
aggregate,
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would have a material adverse effect on the Company's business, properties,
assets or financial condition.
Section 5.03. COVENANTS INCORPORATED BY REFERENCE. The Company
covenants and agrees to comply with all of the covenants set forth in Sections
3A, 3B, 3C and 3D of the Credit Agreement as in effect on the date hereof;
provided, that with respect to any such incorporated covenant that provides for
the delivery of items to any party or provides for the consent of any party or
provides that actions may be taken with the consent of certain parties, all of
such items shall under this Agreement be delivered to the Bank and no such
consent by any party under the Credit Agreement shall be effective to bind the
Bank and any such consent will, under this Agreement, be required to be obtained
from the Bank.
Section 5.04. COMPLIANCE WITH BOND DOCUMENTS AND OTHER CONTRACTS. The
Company (i) will comply with all of its covenants and agreements under the Bond
Documents, as the same may hereafter be amended or supplemented from time to
time, and (ii) will comply with, or cause to be complied with, all requirements
and conditions of all contracts and insurance policies which relate to the
Project Facilities where the failure to so comply could reasonably be expected
to have a material adverse effect on the Company's business, properties, assets
or financial condition.
Section 5.05. CONSENTS UNDER BOND DOCUMENTS. The Company will obtain
the applicable consent whenever the consent of the Trustee or the bondholders is
required to be obtained under the Bond Documents for any action required to be
taken by the Company under this Agreement.
Section 5.06. AMENDMENTS TO BOND DOCUMENTS. The Company will not
consent to or enter into any amendment of or supplement to the Bond Documents,
or take any other action requiring the consent of the Trustee or the
bondholders, without the prior written consent of the Bank, which consent will
not unreasonably be withheld.
Section 5.07. LIMITATION ON OPTIONAL CALLS FOR REDEMPTION. The Company
will not exercise its rights under the Bond Documents to direct the Issuer to
call the Bonds for any optional redemption unless the Company first demonstrates
to the satisfaction of the Bank that at the time of such redemption the Bank
will be fully reimbursed for all drawings on the Letter of Credit in connection
with such redemption.
Section 5.08. PAYMENT OF DEBT. The Company will make full and timely
payment, within any applicable grace periods, of the principal of and interest
on all obligations of the Company under the Credit Agreement or any successor or
replacement revolving credit agreement, whether now existing or hereafter
arising, and comply in all material respects with all covenants and agreements
set forth in agreements evidencing such obligations of the Company.
Section 5.09. FURTHER ASSURANCES. The Company will execute and deliver
from time to time, upon demand by the Bank, such further instruments and take
such further actions as may be required to carry out the purposes and provisions
of this Agreement, as the Bank may reasonably require.
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ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. DEFAULTS. Each of the following shall constitute an event
of default hereunder (an "Event of Default"):
(a) Failure by the Company to make or cause to be made when due any
payment under Section 2.02(a) on the date when such payment is due and such
payment remains unpaid for five (5) days;
(b) Failure by the Company to make any other payment under this
Agreement when due and such payment remains unpaid for ten (10) days;
(c) Failure by the Company to perform or to comply with any of the
terms or conditions contained in Section 5.05, 5.06 or 5.07 or Sections 3B or
3D.05 of the Credit Agreement, which have been incorporated by reference into
this Agreement pursuant to Section 5.03 hereof;
(d) Any of the representations or warranties of the Company set forth
in this Agreement, the Credit Agreement, the Bond Documents or any other
document furnished to the Bank pursuant to the terms hereof proves to have been
false or misleading in any material respect when made and would result in a
material adverse change in the financial position of the Company, or, subject to
subsection (a) through (c) hereof, the Company shall fail to perform or observe
any term, covenant or agreement contained in this Agreement, and such material
adverse change or failure to perform shall remain in effect for a period of 30
days after the earliest of written notice thereof from the Bank to the Company
or the Company has knowledge that such failure has continued for 30 days;
(e) The occurrence and continuation of an Event of Default under the
Credit Agreement;
(f) Any material provision of this Agreement, or of any of the Bond
Documents, for any reason ceases to be valid and binding on the Company, or is
declared to be null and void, or is violative of any applicable law relating to
a maximum amount of interest permitted to be contracted for, charged or
received, or the validity or enforceability thereof is contested by the Company
or any governmental agency, court or authority, or the Company denies that it
has any or further liability or obligation under this Agreement, or under any of
the Bond Documents; or
(g) The occurrence of an Event of Default as defined in any of the Bond
Documents.
Section 6.02. REMEDIES. If an Event of Default has occurred and is
continuing uncured, the Bank may:
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(a) Notify the Trustee of such Event of Default, direct the Trustee to
declare an Event of Default, as defined in the Indenture, to accelerate the
Bonds and to draw on the Letter of Credit, direct the Trustee not to reinstate
any amount under the Letter of Credit as provided thereby, and/or direct the
Trustee to exercise remedies under the Bond Documents;
(b) Declare the Company's obligations hereunder to be, at the option of
the Bank and without demand or notice of any kind (which are hereby expressly
waived), accelerated whereupon the same shall become immediately due and
payable;
(c) By giving written or telegraphic notice to the Company, declare an
amount equal to the maximum amount which may at any time be drawn under the
Letter of Credit (whether or not the Trustee shall have presented, or shall be
entitled at such time to present, the drafts, certificates or other documents
required to draw on the Letter of Credit), together with the other obligations
of the Company to the Bank hereunder to be forthwith due and payable, and the
same shall thereupon become due and payable without demand, presentment, protest
or further notice of any kind, all of which are hereby expressly waived. Such
amounts, when received by the Bank, shall be held by the Bank in an escrow
account, without interest, and the Bank is hereby authorized to apply such
amounts to reimburse itself for amounts drawn on the Letter of Credit, but not
before any such drawing is honored, or to pay any such other obligation of the
Company to the Bank hereunder; or
(d) Exercise, or cause to be exercised, any and all such remedies as it
may have under this Agreement or any other document delivered to the Bank in
respect of the Bonds or otherwise at law or in equity.
Section 6.03. WAIVERS; CONSENTS. No waiver of, or consent with respect
to, any provision of this Agreement shall in any event be effective unless the
same shall be in writing and signed by the Bank, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which it was given.
Section 6.04. NO WAIVER; REMEDIES CUMULATIVE. No failure on the part of
the Bank to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; and no single or partial exercise of any right
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies available under any other document or at law or in
equity.
Section 6.05. SET-OFF. During the continuance of any Event of Default,
the Bank is hereby authorized at any time and from time to time without notice
to the Company (any such notice being expressly waived by the Company) and, to
the fullest extent permitted by law, to set-off and to apply any and all
balances, credits, deposits (general or special, time or demand, provisional or
final), accounts or moneys at any time held and other indebtedness at any time
owing by the Bank to or for the account of the Company against any and all of
the obligations of the Company now or hereafter existing under this Agreement or
any other agreement or instrument delivered by the Company to the Bank in
connection therewith, whether or not the Bank shall have made any demand
hereunder or thereunder and although such obligations may be contingent or
unmatured. The rights of the Bank under this Section are in addition to other
rights
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and remedies (including, without limitation, other rights of set-off) which the
Bank may have. Following the exercise of any rights or remedies under this
Section 6.05, the Bank shall notify the Company of such exercise; provided,
however, that the failure to so notify the Company shall not affect the exercise
of such rights or remedies or result in any liability on the part of the Bank
whatsoever.
ARTICLE VII
MISCELLANEOUS
Section 7.01. NOTICES. All notices and other communications provided
for hereunder shall be in writing and sent by United States certified or
registered mail, return receipt requested, or by telegraph, telex, telecopier or
private delivery service, addressed as follows:
If to the Bank: PNC Bank, National Association
1375 East Ninth Street, Suite 1250
Cleveland, Ohio 44114
Attention: David J. Williams
If to the Company: LESCO, Inc.
20005 Lake Road
Rocky River, Ohio 44116-1545
Attention: Ware H. Grove, Chief Financial Officer
Any such notice to the Bank shall refer to this Agreement and the then Letter of
Credit by date and by number. Either party hereto may change the address to
which notices to it are to be sent by written notice given to the other persons
listed in this Section. All notices shall, when mailed as aforesaid, be
effective on the date indicated on the return receipt, and all notices given by
other means shall be effective on the Business Day when received.
Section 7.02. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and shall be binding upon the parties hereto and their respective
successors and assigns, including without limitation the Participating Banks.
The Company may not assign its rights under this Agreement without the prior
written consent of the Bank. So long as no Event of Default has occurred and is
continuing, the Bank may not assign its rights under this Agreement (except to
an affiliate of the Bank) without the prior written consent of the Company,
which consent will not unreasonably be withheld. The Company and the Bank intend
that no other person shall have any claim or interest under this Agreement or
right of action hereon or hereunder.
Section 7.03. SURVIVAL OF COVENANTS. All covenants made by the Company
herein and in any document delivered pursuant hereto shall survive the delivery
of this Agreement and the Letter of Credit and any advances under the Letter of
Credit.
Section 7.04. COUNTERPARTS. The execution hereof by each party hereto
shall constitute a contract between them for the uses and purposes herein set
forth, and this Agreement may be
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executed in any number of counterparts, with each executed counterpart
constituting an original and all counterparts together constituting one
agreement.
Section 7.05. COSTS, EXPENSES AND TAXES. The Company agrees to pay on
demand all reasonable costs and expenses of the Bank in connection with the
preparation, execution, delivery and enforcement of this Agreement, the Letter
of Credit and any other documents that may be delivered in connection with this
Agreement, the Letter of Credit or the Bond Documents or any amendments or
supplements thereto, including, without limitation, the reasonable fees and
expenses of counsel for the Bank with respect thereto and with respect to
advising the Bank as to its rights and responsibilities under this Agreement,
the Letter of Credit and such other documents upon the occurrence of an Event of
Default or a potential Event of Default hereunder. In addition, the Company
shall pay any and all stamp and other taxes and fees payable or determined to be
payable in connection with the execution and delivery of this Agreement, the
Letter of Credit and such other documents, and agrees to indemnify and to hold
the Bank harmless from and against any and all liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes and fees;
provided the Bank promptly notifies the Company of any such taxes and fees.
Notwithstanding anything to the contrary in this Section 7.05, the Company shall
have no obligation to pay the costs and expenses of the Bank or any
Participating Bank, or any such taxes and fees, in connection with the execution
and delivery of any participation agreement referred to in Section 7.12.
Section 7.06. AMENDMENTS. This Agreement may be amended only by an
instrument in writing executed and delivered by the party against whom
enforcement is sought.
Section 7.07. SEVERABILITY; INTEREST LIMITATION. If any provision
hereof is found by a court of competent jurisdiction to be prohibited or
unenforceable in any jurisdiction, it shall be ineffective as to such
jurisdiction only to the extent of such prohibition or unenforceability, and
such prohibition or unenforceability shall not invalidate the balance of such
provision as to such jurisdiction to the extent it is not prohibited or
unenforceable, nor invalidate such provision in any other jurisdiction, nor
invalidate the other provisions hereof, all of which shall be liberally
construed in favor of the Bank in order to effect the provisions of this
Agreement. Notwithstanding anything to the contrary herein contained, the total
liability of the Company for payment of interest pursuant hereto shall not
exceed the maximum amount, if any, of such interest permitted by applicable law
to be contracted for, charged or received, and if any payments by the Company to
the Bank include interest in excess of such a maximum amount, the Bank shall
apply such excess to either any other amount due hereunder, the reduction of the
unpaid principal amount due pursuant hereto, or if none is due, such excess
shall be refunded to the Company; provided that, to the extent permitted by
applicable law, in the event the interest is not collected, applied for
principal or refunded pursuant to this sentence and interest thereafter payable
pursuant hereto shall be less than such maximum amount, then such interest
thereafter so payable shall be increased up to such maximum amount to the extent
necessary to recover the amount of interest, if any, theretofore uncollected,
applied to principal or refunded pursuant to this sentence. Any such application
or refund shall not cure or waive any Event of Default. In determining whether
or not any interest payable under this Agreement exceeds the highest rate
permitted by law, any non-principal payment (except payments specifically stated
in this
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Agreement to be "interest") shall be deemed, to the extent permitted by
applicable law, to be an expense, fee, premium or penalty rather than interest.
Section 7.08. COMPLETE AGREEMENT. Taken together with the other
instruments and documents delivered in compliance herewith, this Agreement is a
complete memorandum of the agreement of the Company and the Bank. Waivers or
modifications of any provision hereof must be in writing signed by the party to
be charged with the effect thereof.
Section 7.09. CONSENT TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL. (a)
The Company hereby irrevocably (i) agrees that any suit, action or other legal
proceeding arising out of or relating to this Agreement or the Letter of Credit
may be brought in any federal or state court located in Cleveland, Ohio and
consents to the jurisdiction of such court in any such suit, action or
proceeding, (ii) agrees that any suit, action or other legal proceeding by the
Company against the Bank shall be brought solely in a federal or state court
located in Cleveland, Ohio, and (iii) waives any objection which it may have to
the laying of venue of any such suit, action or proceeding in any such court and
any claim that any such suit, action or proceeding has been brought in an
inconvenient forum. The Company hereby irrevocably consents to the service of
any and all process in any such suit, action or proceeding by mailing copies of
such process to the Company at its address provided under or pursuant to Section
7.01. The Company agrees that final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. All mailings under this Section
shall be by certified or registered mail, return receipt requested. Nothing in
this Section shall affect the right of the Bank to serve legal process in any
other manner permitted by law or affect the right of the Bank to bring any suit,
action or proceeding against the Company or its property in the courts of any
other jurisdiction.
(b) JURY WAIVER. THE COMPANY, TO THE EXTENT PERMITTED BY LAW, WAIVES
ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING
IN CONTRACT, TORT OR OTHERWISE, BETWEEN THE BANK AND THE COMPANY ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THE COMPANY AND THE BANK IN CONNECTION WITH THIS AGREEMENT, THE LETTER
OF CREDIT OR ANY OTHER AGREEMENT, INSTRUMENT OR DOCUMENT EXECUTED OR DELIVERED
IN CONNECTION THEREWITH OR THE TRANSACTIONS RELATED THERETO.
Section 7.10. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State without reference to its
principles of conflicts of law. The Letter of Credit shall be governed and
construed as set forth therein.
Section 7.11. HEADINGS. Section headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
Section 7.12. PARTICIPATION. Notwithstanding any other provision of
this Agreement, the Company understands that the Bank may at any time on or
after the date hereof enter into
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participation agreements with one or more participating banks ("Participating
Banks") whereby the Bank will allocate to the Participating Banks certain
percentages of the payment obligations of the Company under this Agreement and
the funding obligations of the Bank under the Letter of Credit. The Company
acknowledges, that, for the convenience of all parties, this Agreement is being
entered into with the Bank only and, subject to the limitation set forth in this
Section 7.12, that the Company's obligations under this Agreement are and will
be undertaken for the benefit of, and as an inducement to, the Participating
Banks as well as the Bank. Without limiting the foregoing, the Company
acknowledges that Section 2.05 and the indemnity of the Bank under Section 7.05
are also for the benefit of the Participating Banks as if such sections
specifically referred to the Participating Banks and their participation in the
payment obligations of the Company and the funding obligations of the Bank, and
the Company agrees to make any payments required by such provisions for the
account of any one or more Participating Banks to the Bank on demand of the
Bank. Section 2.02(e) is not for the benefit of the Participating Banks; such
limitation shall not impair or affect the obligations of the Company under
Section 2.02(e) which may be enforced by the Bank and shall be applicable as if
there were no Participating Bank. In the event of any such participation, if
any, the Bank shall remain the issuer of the Letter of Credit.
IN WITNESS WHEREOF, the Company and the Bank have caused this Agreement
to be duly executed and delivered as of the date first above written.
LESCO, INC., an Ohio corporation
By: /s/ Kenneth W. Didion
-------------------------------------
Name: Kenneth w. Didion
-------------------------------
Title: Treasurer
-------------------------------
PNC BANK, NATIONAL ASSOCIATION, a
national banking association
By: /s/ David J. Williams
-------------------------------------
David J. Williams
Vice President
26
EXHIBIT A
---------
Irrevocable Letter of Credit No. A-309645
November 5, 1997
PNC Bank, National Association
One Oliver Plaza, 27th Floor
210 Sixth Avenue
Pittsburgh, Pennsylvania 15265
Attention: Corporate Trust Administration
Mr. Mark Rullo
Ladies and Gentlemen:
At the request and on the instructions of our customer, LESCO,
Inc. (the "Company"), we hereby establish in your favor, as Trustee under the
Indenture of Trust, dated as of November 1, 1997 (the "Indenture"), between the
Highlands County Industrial Development Authority (the "Issuer") and you,
pursuant to which $7,500,000 in aggregate principal amount of the Issuer's
Industrial Development Revenue Bonds, Series 1997 (LESCO, Inc. Project) (the
"Bonds") have been issued, this Irrevocable Letter of Credit in the amount of
$7,726,027.40 (hereinafter, as reduced from time to time in accordance with the
provisions hereof, the "Stated Amount") of which an amount not exceeding
$7,500,000 (as reduced from time to time in accordance with the provisions
hereof, the "Principal Component") may be drawn upon with respect to payment of
the unpaid principal amount or the portion of purchase price corresponding to
principal of the Bonds, and an amount not exceeding $226,027.40 (as reduced from
time to time in accordance with the provisions hereof, the "Interest Component")
may be drawn upon with respect to payment of interest accrued or the portion of
purchase price corresponding to interest accrued on the Bonds on or prior to
their stated maturity date, effective immediately and expiring on March 16,
2000, unless terminated earlier in accordance with the provisions hereof or
unless otherwise extended. All drawings under this Letter of Credit will be paid
with our own funds.
This Letter of Credit expires on March 16, 2000. Upon the
written request of the Company, which request shall be made on or about
September 16 of each year, commencing September 16, 1999, to extend the
expiration date, PNC Bank, National Association (the "Bank") may decide, in its
sole discretion, to extend the expiration date for one year from the
then-current expiration date; provided, however, the expiration date shall not
be extended beyond December 16, 2017. We shall notify the Company in writing of
our decision of whether the expiration date shall be extended no later than
November 16 of each year. The Principal Component of this Letter of Credit shall
automatically decrease upon payment of principal of the Bonds, by redemption or
at stated maturity, by an amount equal to such payment.
Funds under this Letter of Credit will be made available to
you against receipt by us of the following items at the time required below, in
each case accompanied by a photocopy of this Letter of Credit: (A) if the
drawing is being made with respect to payment of the portion
Page 1 of 11 of Irrevocable Letter of Credit No. A-309645.
27
of the purchase price of Bonds delivered to you pursuant to Sections 2.02(c),
4.01, 4.02 or 4.04 of the Indenture corresponding to the principal thereof (an
"A Drawing"), receipt by us of your written certificate in the form of Exhibit A
attached hereto appropriately completed and signed by an Authorized Officer; (B)
if the drawing is being made with respect to principal on the Bonds, by
redemption or at stated maturity (a "B Drawing"), receipt by us of your written
certificate in the form of Exhibit B attached hereto appropriately completed and
signed by an Authorized Officer; and (C) if the drawing is being made with
respect to the payment of interest, or the portion of purchase price
corresponding to interest, on the Bonds (a "C Drawing"), receipt by us of your
written certificate in the form of Exhibit C attached hereto appropriately
completed and signed by an Authorized Officer. Presentation of such
certificate(s), shall be made at our office located at 237 Fifth Avenue,
Pittsburgh, Pennsylvania 15222; Attention: Mary Ann McCarty, or any other office
which may be designated by us by written notice delivered to you, or may be made
by telecopy transmission (telecopier number: (412) 705-0966, confirmed by
telephone (telephone number: (412) 762-2798).
If a drawing is made by you hereunder at or prior to 10:00
a.m., Pittsburgh, Pennsylvania time, on a business day, and provided that such
drawing and the documents and other items presented in connection therewith
conform to the terms and conditions hereof, payment shall be made to you, or to
your designee, of the amount specified, in immediately available funds, not
later than 2:00 p.m., Pittsburgh, Pennsylvania time, on the same business day or
not later than 1:00 p.m., Pittsburgh, Pennsylvania time, on such later business
day as you may specify. If requested by you, payment under this Letter of Credit
will be made by deposit of immediately available funds in accordance with your
instructions. If a demand for payment made by you hereunder does not, in any
instance, conform to the terms and conditions of this Letter of Credit, we shall
give you prompt notice that the demand for payment was not effected in
accordance with the terms and conditions of this Letter of Credit, stating the
reasons therefor and that we will, upon your instructions, hold any documents at
your disposal or return the same to you. Upon being notified that the demand for
payment was not effected in conformity with this Letter of Credit, you may
attempt to correct any such non-conforming demand for payment to the extent that
you are entitled to do so; provided, however, that the revised documentation is
submitted on or before the expiration date of this Letter of Credit.
Demands for payment hereunder honored by us shall not, in the
aggregate, exceed the Stated Amount, as the Stated Amount may have been
reinstated by us as provided in the next paragraph. Subject to the preceding
sentence, each "A Drawing" and each "B Drawing" honored by the Bank hereunder
shall pro tanto reduce the Principal Component, and each "C Drawing" honored by
the Bank hereunder shall pro tanto reduce the Interest Component and any such
reduction shall result in a corresponding reduction in the Stated Amount, it
being understood that after the effectiveness of any such reduction you shall no
longer have any right to make a drawing hereunder in respect of the amount of
such principal and/or interest on the Bonds or the payment of purchase price
corresponding thereto causing or corresponding to such reduction.
Upon release by us of any Pledged Bonds (as defined in the
Letter of Credit Agreement referred to below) delivered in connection with any
"A Drawing," the Principal
Page 2 of 11 of Irrevocable Letter of Credit No. A-309645.
28
Component shall automatically be reinstated by an amount equal to the principal
amount of such Pledged Bonds and the Interest Component shall likewise be
reinstated by an amount equal to 110 days' interest (computed as set forth
below) on the principal amount of such Pledged Bonds. In addition, if you shall
not have received, within ten (10) business days after any payment in respect of
any "C Drawing," notice from us that we have not been reimbursed for such
drawing or a previous or subsequent drawing in accordance with the Letter of
Credit Agreement, dated as of November 1, 1997, between the Company and us, or
that an Event of Default under such Letter of Credit Agreement has occurred and
is continuing, the Interest Component will automatically be reinstated, as of
the close of business on such tenth business day, to an amount equal to 110
days' interest (computed at the rate of 10 percent per annum and on the basis of
a 365/366-day year, notwithstanding the actual rate borne from time to time by
the Bonds) on the then applicable Principal Component.
Only you, as Trustee, may make a drawing under this Letter of
Credit. Upon the payment to you, to your designee or to your account of the
amount demanded hereunder, we shall be fully discharged on our obligation under
this Letter of Credit with respect to such demand for payment and we shall not
thereafter be obligated to make any further payments under this Letter of Credit
in respect of such demand for payment to you or any other person who may have
made to you or makes to you a demand for payment of principal of, purchase price
of, premium, if any, or interest on any Bond. By paying to you an amount
demanded in accordance herewith, we make no representation as to the correctness
of the amount demanded.
This Letter of Credit applies only to the payment of principal
or the portion of purchase price of the Bonds corresponding to principal, and up
to 110 days' interest (computed as aforesaid) accruing on the Bonds on or prior
to the expiration of this Letter of Credit and does not apply to any interest
that may accrue thereon or any principal or premium which may be payable with
respect thereto after such date.
Upon the earliest of (i) the making by you of the final
drawing available to be made hereunder, (ii) receipt of a certificate signed by
an Authorized Officer stating that: "(a) the conditions precedent to the
acceptance of a substitute Credit Facility have been satisfied, (b) the Trustee
has accepted the substitute Credit Facility, and (c) on the effective date of
the substitute Credit Facility, and after receipt by PNC Bank, National
Association, of this certificate, PNC Bank, National Association, Irrevocable
Letter of Credit No. A-309645 shall terminate," (iii) receipt of a certificate
signed by an Authorized Officer stating that no Bonds remain outstanding under
the Indenture, (iv) fifteen days after the date of the conversion of the
interest rate on the Bonds to a fixed non-variable rate of interest, or (v) the
final expiration date hereof, this Letter of Credit shall automatically
terminate and be delivered to us for cancellation.
Communications with respect to this Letter of Credit, other
than a drawing hereunder shall be in writing and shall be addressed to us at PNC
Bank, National Association, One Cleveland Center, 1375 East Ninth Street, Suite
1250, Cleveland, Ohio 44114-1724, Attention: David J. Williams, specifically
referring thereon to this Letter of Credit by number.
Page 3 of 11 of Irrevocable Letter of Credit No. A-309645.
29
This Letter of Credit may not be transferred or assigned,
either in whole or in part except to a successor trustee pursuant to a written
request in the form of Exhibit D attached hereto. We agree to issue a substitute
letter of credit to any such successor trustee (and to successively replace any
such substitute letter of credit) upon the return to us for cancellation of the
original of the letter of credit to be replaced, accompanied by a request
relating to such letter of credit, which (i) shall be substantially in the form
of Exhibit D attached hereto with the blanks appropriately completed, (ii) shall
be signed by an Authorized Officer, (iii) shall specify where indicated therein
the same letter of credit number as the number of the letter of credit to be
replaced, and (iv) shall state the name and address of the successor trustee.
Each substitute letter of credit will be in substantially the form of this
Letter of Credit except for the date.
As used herein (a) "Authorized Officer" shall mean any of your
Vice Presidents, Assistant Vice Presidents, Trust Officers or Assistant Trust
Officers, (b) "purchase price" shall mean the principal amount of, together with
accrued interest on, any Bonds to be purchased in accordance with Sections
2.02(c), 4.01, 4.02 or 4.04 of the Indenture; and (c) "business day" shall mean
any day on which commercial banks located in Pittsburgh, Pennsylvania and
Cleveland, Ohio are required or permitted by law to be open for the purpose of
conducting a commercial banking business.
This Letter of Credit sets forth in full our undertaking, and
such undertaking shall not in any way be modified, amended, amplified or limited
by reference to any document, instrument or agreement referred to herein
(including, without limitation, the Bonds), except only the certificate(s)
referred to herein; and any such reference shall not be deemed to incorporate
herein by reference any document, instrument or agreement except for such
certificate(s).
This credit is subject to the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce,
Publication No. 500.
Very truly yours,
PNC BANK, NATIONAL ASSOCIATION
By:__________________________
Vice President
By:__________________________
Assistant Vice President
Page 4 of 11 of Irrevocable Letter of Credit No. A-309645.
30
EXHIBIT A
---------
CERTIFICATE FOR "A DRAWING"
PNC Bank, National Association
237 Fifth Avenue
Pittsburgh, Pennsylvania 15222
Attention: Mary Ann McCarty
Re: Irrevocable Letter of Credit No. A-309645
-----------------------------------------
The undersigned, an Authorized Officer of PNC Bank, National
Association (the "Trustee"), hereby certifies that:
(1) The Trustee is the Trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the above-referenced Letter
of Credit in the amount of $________ with respect to the payment of the portion
of the purchase price of the Bonds corresponding to the principal amount
thereof, which Bonds are to be purchased pursuant to Section [2.02(c)] [4.01]
[4.02] [4.04] of the Indenture.
(3) The amount demanded hereby does not exceed the amount available on
the date hereof to be drawn under the above-referenced Letter of Credit in
respect of the portion of the purchase price of Bonds corresponding to the
principal amount thereof.
(4) The amount demanded hereby does not include any amount in respect
of the purchase of any Pledged Bonds.
(5) Upon receipt by the undersigned of the amount demanded hereby, (a)
the undersigned will apply the same directly to the payment when due of the
principal amount owing on account of the purchase of Bonds pursuant to the
Indenture, (b) no portion of said amount shall be applied by the undersigned for
any other purpose, and (c) no portion of said amount shall be commingled with
other funds held by the undersigned.
As used herein, the terms "Authorized Officer," "Indenture," "Bonds,"
"Pledged Bonds" and "purchase price" shall have the respective meanings assigned
to such terms in the above-referenced Letter of Credit.
Page 5 of 11 of Irrevocable Letter of Credit No. A-309645.
31
IN WITNESS WHEREOF, the Trustee has executed and delivered this
Certificate as of the ____ day of ____________ , ____.
PNC Bank, National Association,
as Trustee
By:_____________________________
Title:
Page 6 of 11 of Irrevocable Letter of Credit No. A-309645.
32
EXHIBIT B
---------
CERTIFICATE FOR "B DRAWING"
PNC Bank, National Association
237 Fifth Avenue
Pittsburgh, Pennsylvania 15222
Attention: Mary Ann McCarty
Re: Irrevocable Letter of Credit No. A-309645
-----------------------------------------
The undersigned, an Authorized Officer of PNC Bank, National
Association (the "Trustee"), hereby certifies that:
(1) The Trustee is the Trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the above-referenced Letter
of Credit in the amount of $__________ with respect to the payment of principal
on the Bonds, which amount has, or will, within five business days, become due
and payable pursuant to the Indenture, upon maturity or as a result of
acceleration or redemption of the Bonds.
(3) The amount demanded hereby does not exceed any amount in respect of
the principal amount of any Pledged Bonds.
(4) The amount demanded hereby, together with the aggregate of all
prior payments made pursuant to "B Drawings" under the above-referenced Letter
of Credit, does not exceed $7,500,000.
(5) The amount demanded hereby does not exceed the amount available on
the date hereof to be drawn under the above-referenced Letter of Credit in
respect of the principal of the Bonds.
(6) Upon receipt by the undersigned of the amount demanded hereby, (a)
the undersigned will apply the same directly to the payment when due of the
principal amount owing on account of the Bonds pursuant to the Indenture, (b) no
portion of said amount shall be applied by the undersigned for any other
purpose, and (c) no portion of said amount shall be commingled with other funds
held by the undersigned.
As used herein, the terms "Authorized Officer," "Indenture," "Bonds,"
"business day," "B Drawing" and "Pledged Bonds," shall have the respective
meanings assigned to such terms in the above-referenced Letter of Credit.
Page 7 of 11 of Irrevocable Letter of Credit No. A-309645.
33
IN WITNESS WHEREOF, the Trustee has executed and delivered this
Certificate as of the ____ day of __________, ___.
PNC Bank, National Association,
as Trustee
By:_____________________________
Title:
Page 8 of 11 of Irrevocable Letter of Credit No. A-309645.
34
EXHIBIT C
---------
CERTIFICATE FOR "C DRAWING"
PNC Bank, National Association
237 Fifth Avenue
Pittsburgh, Pennsylvania 15222
Attention: Mary Ann McCarty
Re: Irrevocable Letter of Credit No. A-309645
-----------------------------------------
The undersigned, an Authorized Officer of PNC Bank, National
Association (the "Trustee"), hereby certifies that:
(1) The Trustee is the Trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the above-referenced Letter
of Credit in the amount of $_________ with respect to payment of [the portion of
the purchase price of $________ in principal amount of the Bonds corresponding
to the accrued interest thereon, which Bonds are to be purchased pursuant to
Section [2.02(c)] [4.01] [4.02] [4.04] of the Indenture] [accrued interest on
the Bonds], which amount has, or will, within five business days, become due and
payable pursuant to the Indenture.
(3) The amount demanded hereby does not exceed the amount available on
the date hereof to be drawn under the above-referenced Letter of Credit in
respect of interest on the Bonds.
(4) The amount demanded hereby does not include any amount in respect
of the interest on any Pledged Bonds.
(5) Upon receipt by the undersigned of the amount demanded hereby, (a)
the undersigned will apply the same directly to the payment when due of the
[interest owing on account of the Bonds pursuant to the Indenture] [portion of
the purchase price of Bonds pursuant to Section [2.02(c)] [4.01] [4.02] [4.04]
of the Indenture corresponding to accrued interest thereon], (b) no portion of
said amount shall be applied by the undersigned for any other purpose, and (c)
no portion of said amount shall be commingled with other funds held by the
undersigned.
As used herein, the terms "Authorized Officer," "Indenture," "Bonds,"
"business day," "Pledged Bonds" and "purchase price" shall have the respective
meanings assigned to such terms in the above-referenced Letter of Credit.
Page 9 of 11 of Irrevocable Letter of Credit No. A-309645.
35
IN WITNESS WHEREOF, the Trustee has executed and delivered this
Certificate as of the ____ day of __________ , _____.
PNC Bank, National Association,
as Trustee
By:_____________________________
Title:
Page 10 of 11 of Irrevocable Letter of Credit No. A-309645.
36
EXHIBIT D
---------
INSTRUCTION TO ISSUE SUBSTITUTE LETTER OF CREDIT
------------------------------------------------
TO SUCCESSOR TRUSTEE
--------------------
PNC Bank, National Association
237 Fifth Avenue
Pittsburgh, Pennsylvania 15222
Attention: Mary Ann McCarty
Re: Irrevocable Letter of Credit No. A-309645
-----------------------------------------
Ladies and Gentlemen:
Reference is made to (i) the above-referenced letter of credit (the "Old Letter
of Credit") and (ii) the Indenture of Trust, dated as of November 1, 1997 (the
"Indenture"), between the Highlands County Industrial Development Authority and
us.
[Name and address of successor trustee] (the "Successor Trustee") has been
appointed successor trustee under the Indenture. You are hereby requested to
issue, in accordance with the terms of the Old Letter of Credit, a new letter of
credit to the Successor Trustee having the same terms and providing for the same
Stated Amount as the Old Letter of Credit.
We submit herewith for cancellation the original of the Old Letter of Credit.
The individual signing below on our behalf hereby represents that he or she is
duly authorized to so sign on our behalf.
Very truly yours,
PNC BANK, NATIONAL ASSOCIATION,
as Trustee
By: __________________________
Title: _______________________
Page 11 of 11 of Irrevocable Letter of Credit No. A-309645.