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LETTER OF CREDIT AGREEMENT
between
ROLLER BEARING COMPANY OF AMERICA, INC.,
a Delaware corporation
and
HELLER FINANCIAL, INC.,
a Delaware corporation
dated as of September 1, 1994
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TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS
Section 1.1. Definitions ..................................................... 1
ARTICLE TWO
LETTER OF CREDIT
Section 2.1. Issuance of Letter of Credit ................................... 6
Section 2.2. Letter of Credit Drawings ...................................... 6
Section 2.3. Advances ....................................................... 6
Section 2.4. Fees ........................................................... 7
Section 2.5. Method of Payment; Etc. ........................................ 8
Section 2.6. Reduction and Termination ...................................... 8
Section 2.7. Reinstatement of the Amount of the Letter of Credit ............ 9
Section 2.8. Disbursement of Drawings ....................................... 9
Section 2.9. Interest; Computation of Interest .............................. 9
Section 2.10. Payment Due on Non-Business Day to be Made on Next
Business Day ................................................... 9
Section 2.11. Late Payments .................................................. 9
Section 2.12. Source of Funds ................................................10
Section 2.13. Security for Obligations .......................................10
Section 2.14. Replacement or Termination of Letter of Credit .................10
Section 2.15. Excess Interest ................................................10
ARTICLE THREE
CONDITIONS PRECEDENT
Section 3.1. Conditions Precedent to Issuance of Letter of Credit ............11
ARTICLE FOUR
COVENANTS
Section 4.1. Optional Redemption .............................................13
Section 4.2. Related Documents ...............................................14
Section 4.3. Offering Memorandum .............................................14
Section 4.4. Fiduciaries .....................................................14
Section 4.5. Bond Interest Rate ..............................................14
Section 4.6. Amortization ....................................................14
ARTICLE FIVE
DEFAULTS
Section 5.1. Events of Default ...............................................15
(i)
Section 5.2. Remedies ........................................................16
ARTICLE SIX
MISCELLANEOUS
Section 6.1. No Deductions; Increased Costs .................................16
Section 6.2. Indemnity, Costs, Expenses and Taxes ...........................18
Section 6.3. Obligations Absolute ...........................................18
Section 6.4. Liability of Heller ............................................19
Section 6.5. Participants ...................................................19
Section 6.6. Survival of this Agreement .....................................19
Section 6.7. Modification of this Agreement .................................20
Section 6.8. Waiver of Rights by Heller .....................................20
Section 6.9. Severability ...................................................20
Section 6.10. Governing Law; Submission to Jurisdiction;
Waiver of Jury Trial ...........................................20
Section 6.11. Notices ........................................................21
Section 6.12. Survival of Representations and Obligations ....................23
Section 6.13. Taxes and Expenses .............................................23
Section 6.14. Headings .......................................................23
Section 6.15. Counterparts ...................................................23
Section 6.16. Relationship; Consents and Approvals ...........................23
Section 6.17. No Oral Agreements .............................................23
Section 6.18. Approval of Disbursement Requests ..............................24
Signatures ...................................................................25
Appendix I - Form of Letter of Credit
(ii)
LETTER OF CREDIT AGREEMENT
Roller Bearing Company of America, Inc. Dated as of September 1, 1994
140 Terry Drive
Newtown, Pennsylvania 18940
Gentlemen:
The Company (such term and each other capitalized term used herein
having the meaning set forth in Article One hereof) desires to secure a source
of funds to be devoted exclusively to the payment by the Trustee, when and as
due, of the principal of and interest on the Bonds, and has applied to Heller
for issuance by Heller of the Letter of Credit in an Original Stated Amount of
$10,853,904.11. Further, Heller has been requested by the Company to provide a
liquidity facility with respect to the Bonds by extending credit to the Company
in the form of a Liquidity Drawing under the Letter of Credit. Heller has agreed
to issue such Letter of Credit in the following manner and subject to the
following terms and conditions. Accordingly, the Company and Heller hereby agree
as follows:
ARTICLE ONE
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement:
"Acceleration Drawing" - means a drawing under the Letter of Credit
resulting from the presentation of a certificate in the form of "Exhibit F" to
the Letter of Credit.
"Advance" - is defined in Section 2.3(a) hereof.
"Affiliate" - means any Person (i) owned or controlled by the
Company, (ii) under common ownership or control with the Company (collectively
(i) and (ii) are defined as "Related Entities"), (iii) which is a general
partner of or owns a controlling interest in or controls a Related Entity, (iv)
which is a partnership or joint venture in which the Company or any Related
Entity is a partner, (v) which is a trust for the benefit of the Company or any
Related Entity or affiliate thereof, or (vi) which is a joint venture,
corporation, partnership, trust or other entity which is directly or indirectly
controlled by the Company, a Related Entity or an affiliate thereof.
"Agreement" - means this Letter of Credit Agreement, as amended or
supplemented from time to time.
"Alternate Credit Facility" - is defined in the Indentures.
"Authorized Representative" - means the President, the Executive
Vice President or any other person designated by the Company to act on behalf of
the Company pursuant to a written instrument filed with Heller containing the
specimen signature of such person. Such instrument may designate an alternate or
alternates.
"Available Amount" - is defined in the Letter of Credit.
"Base Rate" - is defined in the Credit Agreement.
"Bond Counsel" - means any attorney at law or firm of attorneys, of
nationally recognized standing in matters pertaining to the exclusion from gross
income of interest on bonds for federal income tax purposes issued by states and
political subdivisions and acceptable to Heller and duly admitted to practice
law before the highest court of any state of the United States of America or the
District of Columbia.
"Bond Documents" - means the Bonds, the Indentures, the Loan
Agreements, the Remarketing Agreement, the Placement Agreement, the Private
Placement Memorandum and all amendments and supplements to such documents
approved in writing by Heller.
"Bondholder" - means the registered owner of any Bond.
"Bonds" - means, collectively, the Series 1994A Bonds and the Series
1994B Bonds.
"Business Day" - is defined in the Letter of Credit.
"Cap Interest Rate" - means, subject to the provisions of Section
2.1(b) hereof, a rate per annum of 15%, calculated on the basis of a year of 365
days for the actual days elapsed.
"Closing Date" - means the date on which all conditions precedent
under Section 3.1 hereof have been met and on which the Letter of Credit is
issued.
"Code" - means the Internal Revenue Code of 1986, as amended.
"Company" - means Roller Bearing Company of America, Inc., a
Delaware corporation, and its successors and assigns.
"Company Bonds" - means (i) Bonds owned or held by the Company or
any Affiliate of the Company, or by the Trustee or the Tender Agent, or the
agent of either of them, for the account of the Company or any Affiliate of the
Company, including, but not limited to, Pledged Bonds, or (ii) Bonds which the
Company has notified the Trustee, or which the Trustee knows, were purchased by
another Person for the account of the Company or any Affiliate of the Company,
including, but not limited to, Pledged Bonds.
"Conversion Date" - means the date on which the interest rate on any
Bond is converted to an interest mode other than the Weekly Mode.
"Credit Agreement" - means the Amended and Restated Credit
Agreement, dated as of October 22, 1992, among the Company, Industrial Tectonics
Bearings Corporation, RBC Transport Dynamics Corporation and Heller, as from
time to time amended, restated or supplemented.
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"Credit Documents" - means this Agreement, the Letter of Credit, the
Pledge Agreement, the Loan Documents (as defined in the Credit Agreement) and
all other agreements, security agreements, assignments, letters of credit,
guaranties, instruments and/or documents now or hereafter executed and/or
delivered to Heller by the Company or any Affiliate relating to the Letter of
Credit, and all amendments and supplements to, and restatements of, such
documents.
"Determination of Taxability" - is defined in the Series 1994A
Indenture.
"Drawing" - means any Interest Drawing, Liquidity Drawing,
Redemption Drawing or Acceleration Drawing.
"Event of Default" - is defined in Section 5.1 hereof.
"Fees" - means fees payable by the Company pursuant to Section 2.4
hereof.
"Governmental Authority" - means the United States, the State of
South Carolina and any political subdivision thereof, and any agency,
department, commission, board, bureau or instrumentality of any of them which
exercises jurisdiction over the Company or the Project, construction with
respect thereto, the use of improvements with respect thereto or the
availability of ingress or egress thereto, or of gas, water, electricity or
sewage facilities therefor.
"Heller" - means Heller Financial, Inc., a Delaware corporation, and
its successors and assigns.
"Indebtedness" - is defined in the Credit Agreement.
"Indentures" - means, collectively, the Series 1994A Indenture and
the Series 1994B Indenture.
"Interest Drawing" - means a drawing under the Letter of Credit
resulting from the presentation of a certificate in the form of "Exhibit C" to
the Letter of Credit.
"Interest Payment Date" - is defined in the Indentures.
"Issuer" - means the South Carolina Jobs-Economic Development
Authority, a body corporate and politic and an agency of the State of South
Carolina, and its successors and assigns.
"Letter of Credit" - means the irrevocable transferable letter of
credit issued by Heller for the account of the Company in favor of the Trustee
for the benefit of the owners from time to time of the Bonds pursuant to this
Agreement in the form of Appendix I hereto with appropriate insertions, as from
time to time amended, restated or supplemented; the term "Letter of Credit"
shall mean and include all substitute irrevocable transferable letters of credit
delivered by Heller to the Trustee pursuant to the provisions of Section 2.6
hereof.
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"Liabilities" - means the Advances, the Fees, any and all
obligations of the Company to reimburse Heller for any Drawings under the Letter
of Credit, and all other indebtedness, liabilities and obligations of the
Company to Heller arising under or in relation to this Agreement.
"Lien" - is defined in the Credit Agreement.
"Liquidity Drawing" - means a drawing under the Letter of Credit
resulting from the presentation of a certificate in the form of "Exhibit E" to
the Letter of Credit.
"Loan Agreements" - means, collectively, the Series 1994A Loan
Agreement and the Series 1994B Loan Agreement.
"Original Stated Amount" - is defined in Section 2.1 hereof.
"Outstanding" - is defined in the Indentures.
"Person" - is defined in the Credit Agreement.
"Placement Agent" - means Stern Brothers & Co., as placement agent
under the Placement Agreement.
"Placement Agreement" - means the Bond Placement Agreement, dated
September 2, 1994, among the Issuer, the Company and the Placement Agent, as
from time to time amended, restated or supplemented.
"Pledge Agreement" - means the Pledge and Security Agreement, dated
as of September 1, 1994, among the Company, Heller and the Trustee, as from time
to time amended, restated or supplemented.
"Pledged Bonds" - means Bonds registered in the name of the Company,
held by the Trustee and pledged to Heller pursuant to the Indenture and the
Pledge Agreement.
"Potential Default" - means an event which but for the lapse of time
or the giving of notice, or both, would constitute an Event of Default.
"Private Placement Memorandum" - means the Private Placement
Memorandum, dated September 2, 1994, relating to the Bonds, as amended or
supplemented from time to time.
"Project" - is defined in the Loan Agreements.
"Property" - means any and all right, title and interest of any
Person in and to any and all property, whether real or personal, tangible or
intangible, including, but not limited to, cash and cash equivalents, and
wherever situated.
"Purchase Date" - means any date on which the Bonds are subject to
purchase pursuant to Section 301 or 302 of the Indentures.
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"Redemption Drawing" - means a drawing under the Letter of Credit
resulting from the presentation of a certificate in the form of "Exhibit D" to
the Letter of Credit.
"Remarketing Agent" - means Stern Brothers & Co., as remarketing
agent under the Indentures, and any successor remarketing agent.
"Remarketing Agreement" - means the Remarketing Agreement, dated as
of September 1, 1994, between the Remarketing Agent and the Company, as from
time to time amended, restated or supplemented.
"Series 1994A Bonds" - means the $7,700,000 aggregate principal
amount of the Issuer's Variable Rate Demand Industrial Development Revenue Bonds
(Roller Bearing Company of America, Inc. Project) Series 1994A issued pursuant
to the Series 1994A Indenture.
"Series 1994B Bonds" - means the $3,000,000 aggregate principal
amount of the Issuer's Variable Rate Demand Industrial Development Revenue Bonds
(Roller Bearing Company of America, Inc. Project) Series 1994B issued pursuant
to the Series 1994B Indenture.
"Series 1994A Indenture" - means the Trust Indenture, dated as of
September 1, 1994, relating to the Series 1994A Bonds, between the Issuer and
the Trustee, as amended and supplemented in accordance with the terms hereof and
thereof.
"Series 1994B Indenture" - means the Trust Indenture, dated as of
September 1, 1994, relating to the Series 1994B Bonds, between the Issuer and
the Trustee, as amended and supplemented in accordance with the terms hereof and
thereof.
"Series 1994A Loan Agreement" - means the Loan Agreement, dated as
of September 1, 1994, relating to the Series 1994A Bonds, between the Issuer and
the Company, as from time to time amended, restated or supplemented.
"Series 1994B Loan Agreement" - means the Loan Agreement, dated as
of September 1, 1994, relating to the Series 1994B Bonds, between the Issuer and
the Company, as from time to time amended, restated or supplemented.
"Stated Expiration Date" - means, subject to the provisions of
Section 2.1(b) hereof, September 15, 1999.
"Tender Agent" - means the Trustee, as Tender Agent under the
Indentures, and any successor tender agent.
"Termination Date" - means the earliest to occur of (i) the close of
Heller's business on the Stated Expiration Date; (ii) the date which is ten (10)
days following the Trustee's receipt of written notice from Heller of the
occurrence of an Event of Default and a direction to cause an acceleration or a
purchase in lieu of acceleration of all Outstanding Bonds pursuant to the
Indentures; (iii) the date on which all Bonds are paid or deemed paid under the
terms of the Indentures; (iv) the date on which the Bonds become secured by an
Alternate Credit Facility in accordance with the terms of the Indentures; or (v)
the earlier of (A) the date which
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is five (5) days after the Conversion Date, or (B) the date on which Heller
honors a Drawing under the Letter of Credit on or after the Conversion Date.
"Trustee" - means Mark Twain Bank, St. Louis, Missouri, as Trustee
under the Indentures, and any successor trustee thereunder.
"Trust Estate" - is defined in the Indentures.
"Weekly Mode" - is defined in the Indentures.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms. Any capitalized terms used
herein which are not specifically defined herein shall have the same meaning
herein as in the Indentures. All references in this Agreement to times of day
shall be references to Chicago, Illinois time unless otherwise specifically
provided.
ARTICLE TWO
LETTER OF CREDIT
Section 2.1. Issuance of Letter of Credit. (a) Heller agrees to
issue on the Closing Date, upon the terms, and subject to the conditions, set
forth in this Agreement, the Letter of Credit substantially in the form of
Appendix I hereto. The Letter of Credit shall be effective on the Closing Date
and shall expire on the Stated Expiration Date. The Letter of Credit shall be in
the original stated amount of $10,853,904.11 (the "Original Stated Amount"),
which is the sum of (i) the principal amount of Bonds outstanding on the Closing
Date, plus (ii) interest on the Bonds at the Cap Interest Rate for a period of
35 days (based on a year consisting of 365 days).
(b) Heller reserves the right, in its sole and absolute discretion,
but does not undertake the obligation, upon written application of the Company
to extend the Stated Expiration Date or increase the Cap Interest Rate. In the
event of any such extension or increase, Heller shall notify the Trustee in
writing, and the Trustee shall be obligated to follow the procedure relating
thereto set forth in the Letter of Credit. Heller agrees to respond to each
completed application of the Company for an extension of the Stated Expiration
Date or an increase in the Cap Interest Rate within thirty (30) days of the
receipt thereof by Heller; failure by Heller to respond within such period shall
be deemed a rejection of the application.
Section 2.2. Letter of Credit Drawings. The Trustee is authorized to
make Drawings under the Letter of Credit in accordance with the terms thereof.
The Company hereby directs Heller to make payments under the Letter of Credit in
the manner therein provided.
Section 2.3. Advances. (a) Each amount paid upon a Drawing and not
reimbursed by the Company on the day the Drawing is paid by Heller shall
constitute an advance (individually an "Advance," and collectively "Advances")
to the Company by Heller on the date such Drawing is paid by Heller. Advances
shall bear interest and be payable in the manner provided herein. Heller shall
record on its books or records the amount of each Advance payable hereunder, all
payments of principal and interest thereon and the principal balance from
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time to time outstanding. The record thereof shown on such books or records
shall be prima facie evidence as to all such amounts outstanding hereunder;
provided, however, that the failure of Heller to record on its books or records
any of the foregoing shall not limit or otherwise affect the obligation of the
Company to repay all Advances payable hereunder together with accrued interest
thereon.
(b) Each Advance resulting from an Interest Drawing, a Redemption
Drawing or an Acceleration Drawing shall bear interest on the unpaid principal
amount thereof at the default rate set forth in Section 2.11 hereof. Each
Advance resulting from a Liquidity Drawing shall bear interest prior to an Event
of Default on the unpaid principal amount thereof at the Interest Rate set forth
in Section 2.9 hereof, and after an Event of Default has occurred, shall bear
interest at the default rate set forth in Section 2.11 hereof. Such interest
shall be payable monthly, in arrears, on the first day of each month to the
extent accrued and unpaid; interest on Advances incurred with respect to the
purchase of Pledged Bonds shall also be paid upon the remarketing of such
Pledged Bonds pursuant to Section 308 of the Indentures.
(c) The principal amount of each Advance resulting from an Interest
Drawing, a Redemption Drawing or an Acceleration Drawing under the Letter of
Credit shall be reimbursed by the Company on the same day as, and immediately
after, Heller pays the amount of such Drawing in accordance with the terms of
the Letter of Credit. The principal amount of each Advance resulting from a
Liquidity Drawing under the Letter of Credit shall be reimbursed by the Company
on the same day as, and immediately after, the remarketing of the Pledged Bonds
that result from such Drawing; in any event, the outstanding principal amount of
all Advances resulting from Liquidity Drawings and all unpaid accrued interest
thereon shall be due and payable on the Stated Expiration Date. Any amounts
outstanding hereunder may be prepaid at any time or from time to time without
premium or penalty.
(d) Pursuant to the Pledge Agreement, upon Heller's payment of each
Liquidity Drawing, there shall be available for delivery to Heller at the
principal corporate trust office of the Trustee, registered in the name of
Heller as pledgee, the Bonds purchased with such Liquidity Drawing. Heller shall
not transfer any Bonds purchased with the proceeds of a Liquidity Drawing until
the Letter of Credit has been reinstated in an amount equal to the Original
Purchase Price (as defined in the Letter of Credit) of such Bonds as provided in
Section 2.7 hereof. Unless otherwise instructed in writing by Heller, the
Trustee will hold all Pledged Bonds on behalf of Heller. To the extent Heller
actually receives payment in respect of principal of or interest on any Pledged
Bond, Heller shall credit such amounts so received first to the payment of
accrued interest on the Liabilities in the priority provided for under the terms
of Section 2.5 hereof and then to the payment of principal thereof.
Section 2.4. Fees. (a) The Company hereby agrees to pay, or cause to
be paid, to Heller on the Closing Date an issuance fee equal to 1.00% of the
Original Stated Amount of the Letter of Credit. The issuance fee shall be deemed
earned by Heller when paid by the Company, and shall not be subject to rebate,
refund or abatement thereafter.
(b) The Company also hereby agrees to pay, or cause to be paid, to
Heller on each March 1, June 1, September 1 and December 1 and on the Closing
Date, if other than a March 1, June 1, September 1, or December 1, in advance
(commencing on the Closing Date
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and ending on September 1, 1999, unless the Letter of Credit is terminated prior
thereto), one-fourth (1/4) of an annual letter of credit fee equal to the sum of
(i) 2.50% per annum of the Available Amount of the Letter of Credit on such
payment date (taking into account any reductions in the Available Amount of the
Letter of Credit scheduled to occur on such payment date), plus (ii) in the
event and for as long as Anchor National Life Insurance Company or its assignee
or participant ("Anchor") is the owner of a participation in the Letter of
Credit and the Liabilities under this Agreement, 1.50% per annum of Anchor's pro
rata share of the Available Amount of the Letter of Credit on such payment date
(taking into account any reductions in the Available Amount of the Letter of
Credit scheduled to occur on such payment date); provided that the initial
payment on the Closing Date and the last payment of the quarterly portion of
such annual fee shall be prorated for the actual number of days in such quarters
that the Letter of Credit is actually outstanding. Each quarterly payment of the
annual letter of credit fee shall be deemed earned by Heller when paid by the
Company, and shall not be subject to rebate, refund or abatement thereafter.
Section 2.5. Method of Payment; Etc. All payments to be made by the
Company under this Agreement shall be made in immediately available funds and
delivered to Heller by wire transfer, to Heller's account, ABA No. 0710-0001-3,
Account No. 55-00540, at The First National Bank of Chicago, One First National
Plaza, Chicago, Illinois 60670, Reference: Heller Financial, Inc. for the
benefit of Roller Bearing. All payments to be made by the Company under this
Agreement shall be made not later than 12:00 Noon, Chicago, Illinois time, on
the date when due. Payments for which immediately available funds are received
by Heller after 12:00 Noon, Chicago, Illinois time, on any day shall be deemed
to have been made on the next succeeding Business Day.
All payments made pursuant to the terms hereof shall, at Heller's
option, be applied first to the payment of any fees, expenses or other costs
that the Company is obligated to pay hereunder, second to interest on the unpaid
Liabilities at the Interest Rate (as defined in Section 2.9 hereof), and third
to reduce the unpaid principal amount of all Liabilities due hereunder. All
payments not made when due shall be subject to default interest at the times and
rate set forth in Section 2.11 hereof.
Section 2.6. Reduction and Termination. (a) The Available Amount of
the Letter of Credit may be reduced by the Trustee upon submission to Heller of
a certificate in the form of Exhibit D or G to the Letter of Credit, designating
the date (which shall be a Business Day) of such reduction and the amount of
such reduction (which shall be, with respect to the principal component of the
Letter of Credit, in an integral multiple of $100,000 or multiples of $5,000 in
excess thereof).
(b) If the Trustee shall partially reduce the Available Amount
pursuant to paragraph (a) above, Heller shall then have the right to require the
Trustee to simultaneously surrender the outstanding Letter of Credit to Heller
on the effective date of such partial reduction of the Available Amount and to
accept on such date, in substitution for the then outstanding Letter of Credit,
a substitute irrevocable transferable letter of credit, dated such date, for an
amount equal to the amount to which the Available Amount shall have been so
reduced, but otherwise having terms identical to the then outstanding Letter of
Credit. Alternatively, Heller in its sole discretion may elect to deliver to the
Trustee a Notice of Amendment to the Letter
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of Credit in the form of Exhibit H to the Letter of Credit, dated the effective
date of such partial reduction of the Available Amount of the Letter of Credit
and stating the amount to which the Available Amount has been reduced.
Section 2.7. Reinstatement of the Amount of the Letter of Credit.
(a) As set forth in the Letter of Credit, the Available Amount of the Letter of
Credit shall be reduced by an amount equal to the amount of any Drawing made
thereunder; provided, however, that the amount of any Interest Drawing less the
amount of the reduction in the Available Amount of the Letter of Credit
attributable to interest as specified in a certificate in the form of Exhibit D
or G to the Letter of Credit, will be automatically reinstated on the date of
such Drawing without further notice to any Person.
(b) Prior to the Conversion Date, in the event of the remarketing of
Bonds (or portions thereof in Authorized Denominations (as defined in the
Indenture)) previously purchased with the proceeds of a Liquidity Drawing and
upon receipt by Heller of an amount equal to the principal portion of the
Original Purchase Price (as defined in the Letter of Credit) of the Bonds so
remarketed plus all accrued interest thereon, Heller will reinstate the Letter
of Credit by an amount equal to the Original Purchase Price of such Bonds so
remarketed. Upon the receipt by Heller of amounts resulting in a reinstatement
as provided in this Section 2.7(b), Heller shall promptly provide the Trustee
and the Remarketing Agent with notice of such reinstatement in writing, by
telecopy or tested telex.
(c) The Company hereby irrevocably and unconditionally instructs
Heller to reinstate the Letter of Credit in accordance with paragraphs (a) and
(b) above and in accordance with the terms of the Letter of Credit.
Section 2.8. Disbursement of Drawings. The Company hereby directs
Heller to make payments under the Letter of Credit in the manner set forth
therein.
Section 2.9. Interest; Computation of Interest. (a) Amounts
outstanding hereunder from time to time shall bear interest prior to the date
due at a floating rate per annum (the "Interest Rate") equal to four percent
(4%) plus the Base Rate.
(b) All computations of interest, fees and charges payable by the
Company under this Agreement (including, but not limited to, interest payable
pursuant to Section 2.11 hereof) shall be made on the basis of 360 days and
actual days elapsed.
Section 2.10. Payment Due on Non-Business Day to be Made on Next
Business Day. If any sum becomes payable pursuant to this Agreement on a day
which is not a Business Day, the date for payment thereof shall be extended,
without penalty, to the next succeeding Business Day, and such extended time
shall be included in the computation of interest and fees.
Section 2.11. Late Payments. Upon the occurrence of an Event of
Default, Heller may collect interest on the entire unpaid principal amount of
all Liabilities from time to time outstanding at a per annum rate of interest
(the "default rate") equal to the sum of the
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Interest Rate plus three percent (3%) from and after the date of the occurrence
of such Event of Default for as long as such Event of Default continues.
Section 2.12. Source of Funds. All payments made by Heller pursuant
to the Letter of Credit shall be made from the funds of Heller and not with the
funds of any other Person (including, but not limited to, funds provided to
Heller by the Company pursuant to Section 2.3 hereof).
Section 2.13. Security for Obligations. In addition to any other
security for the obligations, covenants, warranties and representations of the
Company to Heller under, arising out of or in any way connected with the Letter
of Credit, this Agreement or the other Credit Documents, the Company hereby
grants, pledges and assigns to Heller a lien and security interest in the
Company's interest in the Trust Estate and all of the Company's right, title,
and interest in and to any and all funds now or hereafter on deposit in or
otherwise a part of any fund created under the Indentures (the "Funds
Collateral"); Heller hereby appoints, and the Company hereby consents to
Heller's appointment of, the Trustee as Heller's agent and bailee to perfect
Heller's pledge, assignment and security interest of and in such funds. The
Company shall, or shall cause the Trustee, forthwith after the execution and
delivery of this Agreement and thereafter from time to time to cause any
financing statements to be filed, registered and recorded in such manner and in
all places as may be required by law in order to fully perfect and protect any
lien and security interest created hereby and from time to time will perform or
cause to be performed any other act as provided by law and will execute or cause
to be executed any and all continuation statements and further instruments that
may be requested or required by Heller for such perfection and protection. The
Company will pay or cause the Trustee to pay all filing, registration and
recording fees incident to such filing, registration and recording, and all
expenses incident to the preparation, execution, and acknowledgment of such
instruments of further assurance and all federal or state fees and other similar
fees, duties, imposts, assessments and charges arising out of or in connection
with the execution and delivery of this Agreement and such instruments of
further assurance.
Section 2.14. Replacement or Termination of Letter of Credit. The
Company may replace or terminate the Letter of Credit at all times and on the
terms and conditions set forth herein and in the Indentures.
Section 2.15. Excess Interest. It is agreed that notwithstanding any
provision to the contrary in any of the Credit Documents, no such provision
shall require the payment or permit the collection of any amount in excess of
the maximum amount of interest permitted by applicable law to be charged for the
use or detention, or the forbearance in the collection, of all or any portion of
the Liabilities ("Excess Interest"). If any Excess Interest is provided for, or
is adjudicated to be provided for, in any of the Credit Documents, then in such
event to the fullest extent permitted by applicable law (a) the provisions of
this Section shall govern and control; (b) neither the Company nor any guarantor
or endorser shall be obligated to pay any Excess Interest; (c) any Excess
Interest that Heller may have received hereunder shall, at the option of Heller,
be (i) applied as a credit against the then outstanding principal amount due
hereunder, accrued and unpaid interest thereon (not to exceed the maximum amount
permitted by applicable law) and any of the other Liabilities, or all of the
foregoing, (ii) refunded to the payor thereof, or (iii) any combination of the
foregoing; (d) the Interest Rate shall be
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automatically subject to reduction to the maximum lawful rate allowed under
applicable usury laws, and each of the Credit Documents shall be deemed to have
been, and shall be, reformed and modified to reflect such reduction in the
Interest Rate; and (e) neither the Company nor any guarantor or endorser shall
have any action against Heller for any damages whatsoever arising out of the
payment or collection of any Excess Interest. In the event that any amount is
foregone by Heller pursuant to the foregoing provisions relating to Excess
Interest, then to the fullest extent permitted by applicable law the interest
rate applicable to amounts owed hereunder shall not thereafter be reduced below
the maximum rate permitted by applicable law until the total amount of interest
accrued hereunder less the amount of interest that would have accrued but for
this provision equals the amount so foregone as Excess Interest.
ARTICLE THREE
CONDITIONS PRECEDENT
Section 3.1 Conditions Precedent to Issuance of Letter of Credit. As
conditions precedent to the obligation of Heller to issue the Letter of Credit,
(a) the Company shall provide or cause to be provided to Heller on the Closing
Date, in form and substance satisfactory to Heller and its counsel:
(i) a written opinion or opinions of Gibson, Dunn & Crutcher,
counsel to the Company, dated the Closing Date;
(ii) a written opinion of Sinkler & Boyd, P.A., bond counsel, dated
the Closing Date;
(iii) a written opinion of Sinkler & Boyd, P.A., counsel to the
Issuer, dated the Closing Date, with respect to the due organization of
the Issuer, the power of the Issuer to enter into the transactions
contemplated by the Bond Documents, the due adoption of all proceedings of
the governing body of the Issuer, and the due authorization, execution,
delivery and enforceability of the Bond Documents to which the Issuer is a
party;
(iv) a copy of the certificate of incorporation of the Company,
certified as of a recent date by the Secretary of State of the State of
Delaware;
(v) a copy of the by-laws of the Company, certified by the Secretary
or an Assistant Secretary of the Company;
(vi) certificates of good standing with respect to the corporate and
tax status of the Company, certified as of a recent date by appropriate
officials of the States of Delaware and South Carolina;
(vii) certified copies of all corporate action taken by the Company
to authorize the execution, delivery and performance by the Company of
this Agreement, the Pledge Agreement and each Bond Document to which the
Company is a party, and such other corporate documents as Heller may
reasonably request;
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(viii) a certificate of a duly authorized officer of the Company as
to the incumbency, and setting forth a specimen signature, of each Person
who is to sign this Agreement, the Pledge Agreement and each Bond Document
to which the Company is a party on behalf of the Company;
(ix) an incumbency certificate, executed by an authorized officer of
the Issuer, which shall identify by name and title and bear the signature
of the officials of the Issuer authorized to sign those Bond Documents to
which the Issuer is a party and to effect the transactions under them;
Heller shall be entitled to rely on such incumbency certificate until
informed of any change in writing by the Issuer;
(x) a certificate of a duly authorized officer of the Company, dated
the Closing Date, stating, among other things, that no Event of Default
has occurred and is continuing, or would result from the issuance of the
Letter of Credit or the execution and delivery of this Agreement, the
Pledge Agreement or any Bond Document to which the Company is a party, and
no event has occurred and is continuing which would constitute an Event of
Default or Potential Default;
(xi) true and correct copies of all governmental approvals necessary
for the Issuer to enter into the Bond Documents to which the Issuer is a
party;
(xii) evidence that the Remarketing Agent has acknowledged and
accepted in writing its appointment as Remarketing Agent under the
Indentures and its duties and obligations thereunder, together with a
legal opinion of counsel to the Remarketing Agent;
(xiii) evidence that the Trustee has acknowledged and accepted in
writing its appointment as Trustee under the Indentures and its duties and
obligations thereunder, together with a legal opinion of counsel to the
Trustee;
(xiv) true and correct copies of the Bond Documents and all other
documents furnished in connection with the issuance and delivery of the
Bonds;
(xv) the following documents executed and delivered on behalf of the
parties thereto:
(A) Fourth Amendment, Acknowledgement and Consent to Amended
and Restated Credit Agreement,
(B) Pledge Agreement, and
(C) Second Amendment to Mortgage, Assignment of Rents,
Security Agreement, Financing Statement and Fixture Filing;
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(xvi) evidence of filing or simultaneous filing of completed Uniform
Commercial Code financing statements from the Company in such forms and in
such places as Heller shall require;
(xvii) written acknowledgment and acceptance by the Trustee of the
security interest granted to Heller pursuant to Section 2.13 hereof;
(xviii) any other items required as a condition precedent under the
terms of the Bond Documents to the closing of the transaction contemplated
by the Bond Documents;
(xix) an endorsement to Chicago Title Insurance Company Loan Policy
Number 9206901-61-2077 NBU; and
(xx) the receipt of such other documents, certificates and opinions
as Heller or its counsel may reasonably request;
(b) no law, regulation, ruling or other action of any Governmental
Authority or any political subdivision or authority therein or thereof shall be
in effect or shall have occurred, the effect of which would be to prevent Heller
from fulfilling its obligations under the Letter of Credit or under this
Agreement;
(c) all legal requirements provided herein incident to the
execution, delivery and performance of this Agreement, the Pledge Agreement and
the Bond Documents, and the transactions contemplated hereby and thereby, shall
be reasonably satisfactory to Heller and its counsel; and
(d) Heller and each of Banque Indosuez (New York Branch), Anchor
National Life Insurance Company, Household Commercial Financial Services, Inc.
and Mitsui Nevitt Capital Corporation shall have entered into a Lender Addition
Agreement (as defined in the Credit Agreement), or an amendment to such entity's
existing Lender Addition Agreement, in form and substance satisfactory to
Heller.
ARTICLE FOUR
COVENANTS
Section 4.1. Optional Redemption; Alternate Credit Facility. The
Company will not, without the prior written consent of Heller, cause an optional
redemption of the Bonds (except as required by Section 4.6 hereof), or the
delivery of an Alternate Credit Facility to secure the Bonds (except as required
by the Credit Agreement), pursuant to the Loan Agreements and the Indentures
unless the Company first (a) pays Heller all amounts due and owing Heller
hereunder at such time, and (b) provides Heller a minimum of thirty (30) days'
prior written notice. In no event shall the Company cause either (a) an optional
redemption of the Bonds in part (except as required by Section 4.6 hereof), or
(b) the delivery of an Alternate Credit Facility to replace the Letter of Credit
in part.
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Section 4.2. Related Documents. The Company will not amend or
consent to any amendment of any Bond Document without the prior written consent
of Heller.
Section 4.3. Offering Memorandum. The Company will not refer to
Heller in any offering memorandum (other than the Private Placement Memorandum)
or make any changes in reference to Heller in any revision of the Private
Placement Memorandum without the prior written consent of Heller.
Section 4.4. Fiduciaries. The Company will not remove or appoint any
Trustee, Tender Agent or Remarketing Agent for the Bonds without the prior
written consent of Heller.
Section 4.5. Bond Interest Rate. The Company will not elect an
interest option for the Bonds other than the Weekly Mode without the prior
written consent of Heller.
Section 4.6. Amortization. The Company will prepay the principal of
the Bonds in the following amounts and at the following times (provided that the
Company shall prepay all of the principal of the Series 1994B Bonds prior to
prepaying any of the principal of the Series 1994A Bonds):
(1) on September 1, 1998, the principal amount of $240,000;
(2) on September 1, 1999, the principal amount of $240,000;
(3) on September 1, 2000, the principal amount of $240,000;
(4) on September 1, 2001, the principal amount of $240,000;
(5) on September 1, 2002, the principal amount of $420,000;
(6) on September 1, 2003, the principal amount of $420,000;
(7) on September 1, 2004, the principal amount of $420,000;
(8) on September 1, 2005, the principal amount of $420,000;
(9) on September 1, 2006, the principal amount of $540,000;
(10) on September 1, 2007, the principal amount of $540,000;
(11) on September 1, 2008, the principal amount of $540,000;
(12) on September 1, 2009, the principal amount of $540,000;
(13) on September 1, 2010, the principal amount of $660,000;
(14) on September 1, 2011, the principal amount of $660,000;
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(15) on September 1, 2012, the principal amount of $660,000;
(16) on September 1, 2013, the principal amount of $660,000;
(17) on September 1, 2014, the principal amount of $815,000;
(18) on September 1, 2015, the principal amount of $815,000;
(19) on September 1, 2016, the principal amount of $815,000; and
(20) on September 1, 2017, the principal amount of $815,000.
The foregoing schedule shall be modified by the parties hereto to reflect any
mandatory redemption of the Bonds that results in a reduction in the principal
amount thereof.
ARTICLE FIVE
DEFAULTS
Section 5.1. Events of Default. If any of the following events shall
occur and be continuing, each such event shall be an "Event of Default":
(a) default in the due and punctual payment of any amount due
hereunder, which default continues for two (2) Business Days;
(b) any "event of default," "Event of Default," "default" or
"Default" shall have occurred under any Bond Document (as defined
respectively therein) after the expiration of any applicable cure or grace
period with respect thereto;
(c) an "Event of Default" shall have occurred under the Credit
Agreement;
(d) default in the due observance or performance of any covenant
contained in Article Four hereof;
(e) failure to observe or perform any other term, covenant or
agreement set forth in this Agreement and the continuation of such failure
for a period of thirty (30) days after written notice thereof from Heller;
provided, however, that if such failure cannot by its nature be cured
within thirty (30) days, and if an attempt to cure such failure is
commenced promptly after written notice thereof and is thereafter
diligently pursued (and then in all events such failure is cured within
sixty (60) days after the original notice thereof), no default shall be
deemed to exist hereunder during such period of diligent curing;
(f) any material provision of this Agreement, the Pledge Agreement
or any Bond Document shall cease to be valid and binding on the Company in
any material respect; or
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(g) the Company shall fail to replace the Letter of Credit, in
accordance with the terms of the Indentures and Loan Agreements, at least
thirty (30) days prior to the Stated Expiration Date.
Section 5.2. Remedies. Upon the occurrence of any Event of Default
Heller may exercise any one or more of the following rights and remedies in
addition to any other remedies herein or by law provided:
(a) by written notice to the Company, require that the Company
immediately pay to Heller in immediately available funds an amount equal
to the Available Amount of the Letter of Credit, any such amount to be
held uninvested (unless otherwise directed in writing by the Company with
specific investment directions, such direction to be accompanied by an
opinion of Bond Counsel (acceptable in form and substance to Heller) to
the effect that such directed investment will not adversely affect the
exclusion from gross income of interest on the Bonds for Federal or State
of South Carolina income tax purposes) by Heller as collateral security
for any and all indebtedness, obligations and liabilities of the Company
to Heller hereunder or under any other Credit Documents, whether now
existing or hereafter arising and whether due or contingent;
(b) declare the principal of and interest on the Liabilities owing
hereunder immediately due and payable, notwithstanding the provisions of
Section 2.3 hereof;
(c) give notice of the occurrence of an Event of Default to the
Trustee and instruct the Trustee to cause the acceleration, or purchase in
lieu of acceleration, at Heller's election, of the Bonds, thereby causing
the Letter of Credit to expire ten (10) days thereafter;
(d) direct the Trustee to exercise Heller's rights under the
Indentures and the Loan Agreements;
(e) exercise Heller's rights and remedies under the Credit
Documents; or
(f) pursue any other action available at law or in equity.
ARTICLE SIX
MISCELLANEOUS
Section 6.1. No Deductions; Increased Costs. (a) Except as otherwise
required by law, each payment by the Company to Heller under this Agreement or
any other Related Document shall be made without deduction, defense, set-off or
counterclaim, and without withholding for or on account of any present or future
taxes (other than overall net income taxes on the recipient imposed by reason of
any payment hereunder by any jurisdiction having authority over such recipient
or the transactions contemplated by this Agreement) imposed by or within the
jurisdiction in which the Company is domiciled, the Project is located, any
jurisdiction from which the Company makes any payment hereunder, or (in each
case) any political subdivision or taxing authority thereof or therein. If any
such withholding is so
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required, the Company shall make the withholding, pay the amount withheld to the
appropriate Governmental Authority before penalties attach thereto or interest
accrues thereon, and forthwith pay such additional amount as may be necessary to
ensure that the net amount actually received by Heller free and clear of such
taxes (including such taxes on such additional amount) is equal to the amount
which Heller would have received had such withholding not been made. If Heller
pays any amount in respect of any such taxes, penalties or interest, the Company
shall reimburse Heller for that payment on demand in the currency in which such
payment was made. If the Company pays any such taxes, penalties or interest, it
shall deliver official tax receipts evidencing that payment or certified copies
thereof to Heller on or before the thirtieth day after payment.
(b) If the Code or any newly adopted or changed law, treaty,
regulation, guideline or directive or any new or modified interpretation of any
of the foregoing by any authority or agency charged with the administration or
interpretation thereof or any fiscal, monetary or other authority having
jurisdiction over Heller or the transactions contemplated by this Agreement
(whether or not having the force of law) shall:
(i) limit the deductibility of interest on funds obtained by Heller
to pay any of its liabilities or subject Heller to any tax, duty, charge,
deduction or withholding on or with respect to payments relating to the
Bonds, the Letter of Credit or this Agreement, or any amount paid or to be
paid by Heller as the issuer of the Letter of Credit (other than any tax
measured by or based upon the overall net income of Heller imposed by any
jurisdiction having authority over Heller or the transactions contemplated
by this Agreement);
(ii) impose, modify, require, make or deem applicable to Heller any
reserve requirement, capital requirement, special deposit requirement,
insurance assessment or similar requirement against any assets held by,
deposits with or for the account of, or loans, letters of credit or
commitments by, an office of Heller in excess of such requirement on the
date of this Agreement;
(iii) change the basis of taxation of payments due Heller under this
Agreement or the Bonds (other than by a change in taxation of the overall
net income of Heller); or
(iv) impose upon Heller any other condition with respect to such
amount paid or payable to or by Heller or with respect to this Agreement,
the Letter of Credit, any other Related Document or the Bonds;
and the result of any of the foregoing is to increase the cost to Heller of
making any payment hereunder or under the Letter of Credit or of maintaining the
Letter of Credit, or to reduce the amount of any payment (whether of principal,
interest or otherwise) receivable by Heller, or to reduce the rate of return on
the capital of Heller or to require Heller to make any payment on or calculated
by reference to the gross amount of any sum received by it, in each case by an
amount which Heller in its reasonable judgment deems material, then:
(1) Heller shall promptly notify the Company in writing of such
event;
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(2) Heller shall promptly deliver to the Company a certificate
stating the change which has occurred or the reserve requirements or
capital requirements or other costs or conditions which have been imposed
on Heller or the request, direction or requirement with which it has
complied, together with the date thereof, the amount of such increased
cost, reduction or payment and a reasonably detailed description of the
way in which such amount has been calculated, and Heller's determination
of such amounts, absent fraud or manifest error, shall be conclusive; and
(3) the Company shall pay to Heller, from time to time as specified
by Heller, such an amount or amounts as will compensate Heller for such
additional cost, reduction or payment.
The protection of this Section 6.1(b) shall be available to Heller
regardless of any possible contention of invalidity or inapplicability of the
law, regulation or condition which has been imposed.
Section 6.2. Indemnity, Costs, Expenses and Taxes. The Company
agrees to indemnify and hold Heller harmless from and against, and to pay on
demand, any and all claims, damages, losses, liabilities, costs and expenses
whatsoever which Heller may incur or suffer by reason of or in connection with
the execution and delivery of this Agreement, the Letter of Credit, the Pledge
Agreement or any Bond Document, including, but not limited to, any and all
claims, damages, losses, liabilities, costs and expenses incurred or suffered by
Heller in connection with the issuance or sale of the Bonds, or any other
documents which may be delivered in connection with this Agreement or the Letter
of Credit, or in connection with any payment under the Letter of Credit,
including, without limitation, the reasonable fees, costs and expenses of
counsel for Heller with respect thereto and with respect to advising Heller as
to its rights and responsibilities under this Agreement, the Letter of Credit,
the Pledge Agreement and the Bond Documents and all fees, costs and expenses, if
any, in connection with the enforcement or defense of the rights of Heller in
connection with this Agreement, the Letter of Credit or any of the Related
Documents, or the collection of any moneys due under this Agreement or such
other documents which may be delivered in connection with this Agreement, the
Letter of Credit or any of the Related Documents; except, only if and to the
extent that any such claim, damage, loss, liability, cost or expense shall be
caused by Heller's failure to act in good faith or failure to examine documents
presented under the Letter of Credit with due care to determine whether they
comply with the terms of the Letter of Credit (it being understood that Heller
assumes no liability or responsibility for the genuineness, falsification or
effect of any document which appears on such examination to be regular on its
face). Promptly after receipt by Heller of notice of the commencement, or
threatened commencement, of any action subject to the indemnities contained in
this Section, Heller shall promptly notify the Company thereof, provided that
the failure to give such notice shall not relieve the Company from any liability
to Heller hereunder. The obligations of the Company under this Section 6.2 shall
survive payment of any Liabilities owed under this Agreement and the expiration
of the Letter of Credit.
Section 6.3. Obligations Absolute. The obligations of the Company
under this Agreement shall be absolute, unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement under all
circumstances.
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Section 6.4. Liability of Heller. The Company assumes all risks of
the acts or omissions of the Trustee, the Tender Agent, the Remarketing Agent,
the Placement Agent or any other agent of the Trustee and any transferee of the
Letter of Credit with respect to its use of the Letter of Credit. Neither Heller
nor any of its officers or directors shall be liable or responsible for: (a) the
use which may be made of the Letter of Credit or for any acts or omissions of
the Trustee and any transferee in connection therewith; (b) the validity or
genuineness of documents, or of any enforcement thereof, even if such documents
should in fact prove to be in any or all respects invalid, fraudulent or forged;
(c) payment by Heller against presentation of documents which do not strictly
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 (d) any other circumstances whatsoever in making or failing to make payment
under the Letter of Credit; provided, however, that the Company shall have a
claim against Heller, and Heller shall be liable to the Company, to the extent
of any direct compensatory, as opposed to consequential, damages suffered by the
Company which the Company proves were caused by Heller's failure to act in good
faith or failure to examine documents presented under the Letter of Credit with
due care to determine whether they strictly comply with the terms of the Letter
of Credit (it being understood that Heller assumes no liability or
responsibility for the genuineness, falsification or effect of any document
which appears on such examination to be regular on its face). Heller is hereby
expressly authorized and directed to honor any demand for payment which is made
under the Letter of Credit without regard to, and without any duty on its part
to inquire into the existence of, any disputes or controversies between or among
the Issuer, the Company, the Remarketing Agent, the Placement Agent, the
Trustee, the Tender Agent or any other Person or the respective rights, duties
or liabilities of any of them, or whether any facts or occurrences represented
in any of the documents presented under the Letter of Credit are true and
correct.
Section 6.5. Participants. Heller shall have the right to grant
participations (to be evidenced by one or more participation agreements or
certificates of participation, or in any other manner or form acceptable to
Heller) in the Letter of Credit and the Liabilities under this Agreement to one
or more other financial institutions, and such participants shall be entitled to
the benefits of this Agreement, including, without limitation, Sections 6.1 and
6.2 hereof, to the same extent as if they were direct parties hereto; provided,
however, that no such participation by any such participant shall in any way
affect the obligation of Heller under the Letter of Credit.
Section 6.6. Survival of this Agreement. All covenants, agreements,
representations and warranties made in this Agreement shall survive the issuance
by Heller of the Letter of Credit and shall continue in full force and effect so
long as the Letter of Credit shall be unexpired or any Liabilities shall be
outstanding and unpaid. Whenever in this Agreement Heller is referred to, such
reference shall be deemed to include the successors and assigns of Heller and
all covenants, promises and agreements by or on behalf of the Company which are
contained in this Agreement shall inure to the benefit of the successors and
assigns of Heller. The rights and duties of the Company, however, may not be
assigned or transferred, except as specifically provided in this Agreement or
with the prior written consent of Heller, and all obligations of the Company
hereunder shall continue in full force and effect notwithstanding any assignment
by the Company of any of its rights or obligations under any of the Bond
Documents or any entering into, or consent by the Company to, any supplement or
amendment
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to any of the Bond Documents. The provisions of Section 6.1 hereof and the
obligation of the Company to reimburse Heller pursuant to Sections 6.1, 6.2 and
6.13 hereof shall survive the payment of the Bonds and termination of this
Agreement.
Section 6.7. Modification of this Agreement. No amendment,
modification or waiver of any provision of this Agreement shall be effective
unless the same shall be in writing and signed by Heller, and no amendment,
modification or waiver of any provision of the Letter of Credit, and no consent
to any departure by the Company therefrom, shall in any event be effective
unless the same shall be in writing and signed by Heller. Any such waiver or
consent shall be effective only in the specific instance and for the purpose for
which given. No notice to or demand on the Company in any case shall entitle the
Company to any other or further notice or demand in the same, similar or other
circumstances.
Section 6.8. Waiver of Rights by Heller. No course of dealing or
failure or delay on the part of Heller in exercising any right, power or
privilege hereunder or under the Letter of Credit or this Agreement shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise or the exercise of any other right or
privilege. The rights of Heller under the Letter of Credit and the rights of
Heller under this Agreement are cumulative and not exclusive of any rights or
remedies which Heller would otherwise have.
Section 6.9. Severability. In case any one or more of the provisions
contained in this Agreement should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby. The
parties shall endeavor in good faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
Section 6.10. Governing Law; Submission to Jurisdiction; Waiver of
Jury Trial. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Illinois, without giving effect to conflict of
law principles. THE COMPANY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER OF THIS AGREEMENT. THIS
WAIVER IS KNOWINGLY, INTENTIONALLY, AND VOLUNTARILY MADE BY THE COMPANY, AND THE
COMPANY ACKNOWLEDGES THAT NEITHER HELLER NOR ANY PERSON ACTING ON BEHALF OF
HELLER HAS MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY
JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. THE COMPANY FURTHER
ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE
REPRESENTED) IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER
BY INDEPENDENT LEGAL COUNSEL SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD
THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL. THE COMPANY FURTHER
ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THE MEANING AND RAMIFICATIONS OF
THIS WAIVER PROVISION AND AS EVIDENCE OF THIS FACT SIGNS ITS INITIALS.
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[COMPANY'S INITIALS]
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Company's Initials
THE COMPANY, FOR OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT
AND SUFFICIENCY OF WHICH HEREBY ARE ACKNOWLEDGED, AGREES THAT ALL ACTIONS OR
PROCEEDINGS ARISING DIRECTLY, INDIRECTLY OR OTHERWISE IN CONNECTION WITH, OUT
OF, RELATED TO OR FROM THIS AGREEMENT SHALL BE LITIGATED, AT HELLER'S SOLE
DISCRETION AND ELECTION, ONLY IN COURTS HAVING A SITUS WITHIN THE COUNTY OF
COOK, STATE OF ILLINOIS. THE COMPANY HEREBY CONSENTS AND SUBMITS TO THE
JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURT LOCATED WITHIN SAID COUNTY AND
STATE. THE COMPANY HEREBY IRREVOCABLY APPOINTS AND DESIGNATES C/T CORPORATION
SYSTEM, WHOSE ADDRESS IS THE COMPANY, C/O C/T CORPORATION SYSTEM, 208 SOUTH
LASALLE STREET, CHICAGO, ILLINOIS 60604, OR ANY OTHER PARTY WHO HELLER MAY FROM
TIME TO TIME HEREAFTER DESIGNATE (AFTER GIVING THE COMPANY SEVEN (7) DAYS'
WRITTEN NOTICE THEREOF), AS ITS TRUE AND LAWFUL ATTORNEY-IN-FACT AND DULY
AUTHORIZED AGENT FOR SERVICE OF LEGAL PROCESS AND AGREES THAT SERVICE OF SUCH
PROCESS UPON SUCH PARTY SHALL CONSTITUTE PERSONAL SERVICE OF SUCH PROCESS UPON
THE COMPANY, PROVIDED THAT SUCH PARTY, WITHIN SEVEN (7) BUSINESS DAYS AFTER
RECEIPT OF ANY SUCH PROCESS, SHALL FORWARD THE SAME, BY CERTIFIED OR REGISTERED
MAIL, TOGETHER WITH ALL PAPERS AFFIXED THERETO, TO THE COMPANY AT ITS ADDRESS
SET FORTH ABOVE. THE COMPANY HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR
CHANGE THE VENUE OF ANY LITIGATION BROUGHT AGAINST IT BY HELLER ON THIS
AGREEMENT IN ACCORDANCE WITH THIS PARAGRAPH.
[COMPANY'S INITIALS]
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Company's Initials
Section 6.11. Notices. Unless otherwise specifically provided
herein, any notice or other communication required or permitted to be given
hereunder shall be in writing addressed to the respective party as set forth
below, and may be personally served, telecopied or sent by overnight courier
service or United States mail, and shall be deemed to have been given: (a) if
delivered in person, when delivered; (b) if delivered by telecopy, on the date
of transmission if transmitted on a Business Day before 4:00 p.m. (Chicago,
Illinois time) or, if not, on the next succeeding Business Day; (c) if delivered
by overnight courier, two days after delivery to such courier properly
addressed; or (d) if by United States mail, four Business Days after deposit in
the United States mail, with postage prepaid and properly addressed. Notices
hereunder shall be effective when received and shall be addressed:
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If to Heller, to: Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager, Portfolio
Organization, Corporate Finance Group
Telephone: (312) 441-7500
Telecopier: (312)441-7367
With a copy to: Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Legal Department, Portfolio
Organization, Corporate Finance Group
Telephone: (312) 441-7500
Telecopier: (312) 441-7367
If to Company, to: Roller Bearing Company of America, Inc.
140 Terry Drive
Newtown, Pennsylvania 18940
Attention: Executive Vice President
Telephone: (215) 579-4300
Telecopier: (215) 579-4318
With a copy to: Gibson, Dunn & Crutcher
2029 Century Park east, Suite 4000
Los Angeles, California 90067
Attention: Bruce D. Meyer, Esq.
Telephone: (310) 552-8686
Telecopier: (310) 277-5827
If to Issuer, to: South Carolina Jobs-Economic
Development Authority
1201 Main Street, Suite 1750
Columbia, South Carolina 29201
Attention: Executive Director
Telephone: (803) 737-0079
Telecopier: (803) 737-0016
If to the Trustee, to: Mark Twain Bank
8820 Ladue Road
St. Louis, Missouri 63124
Attention: Corporate Trust Division
Telephone: (314) 889-0753
Telecopier: (314) 889-0736
-22-
If to the Remarketing Agent, to: Stern Brothers & Co.
8000 Maryland Avenue, Suite 1020
St. Louis, Missouri 63105
Attention: Terrence M. Finn
Telephone: (314) 727-5519
Telecopier: (314) 727-7313
Section 6.12. Survival of Representations and Obligations. All
representations and warranties of the Company contained in this Agreement shall
survive delivery of this Agreement and the transactions contemplated hereby.
Section 6.13. Taxes and Expenses. In addition to the amounts payable
by the Company pursuant to Section 6.1 hereof (and not in duplication thereof),
any taxes (excluding income taxes) payable or ruled payable by any governmental
authority in respect of this Agreement, the Letter of Credit or the Bonds shall
be paid by the Company, together with interest and penalties, if any; provided,
however, that the Company may conduct a reasonable contest of any such taxes
with the prior written consent of Heller. The Company shall reimburse Heller for
any and all out-of-pocket expenses and charges paid or incurred by Heller in
connection with the preparation, execution, delivery, administration and
enforcement (including fees and disbursements of Heller's counsel, which, in
other than an enforcement proceeding, shall be reasonable) of this Agreement,
the Letter of Credit, the Pledge Agreement and the Bond Documents and any
amendment hereto or thereto.
Section 6.14. Headings. The headings and captions in this Agreement
are for convenience of reference only and shall not define or limit the
provisions hereof.
Section 6.15. Counterparts. This Agreement may be executed in
counterpart signature pages, each of which shall constitute an original but all
taken together to constitute one instrument.
Section 6.16. Relationship; Consents and Approvals. The relationship
between Heller and the Company shall be that of creditor-debtor only. No term in
this Agreement or in the other Credit Documents, and no course of dealing
between Heller and the Company, shall be deemed to create any relationship of
agency, partnership or joint venture between Heller and any other party, or
create any fiduciary duty by Heller to any other party. All consents and
approvals to be given by Heller under the Related Documents shall be given,
notwithstanding anything therein to the contrary, in the sole discretion of
Heller.
Section 6.17. No Oral Agreements. THE COMPANY AND HELLER HEREBY
AFFIRM THAT (A) THIS AGREEMENT IS THE FINAL EXPRESSION OF THE LETTER OF CREDIT
AGREEMENT BETWEEN THE COMPANY AND HELLER, (B) THIS AGREEMENT MAY NOT BE
CONTRADICTED BY EVIDENCE OF ANY PRIOR OR CONTEMPORANEOUS ORAL LETTER OF CREDIT
AGREEMENT BETWEEN THE COMPANY AND HELLER, AND (C) NO UNWRITTEN ORAL LETTER OF
CREDIT AGREEMENT EXISTS BETWEEN THE COMPANY AND HELLER.
-23-
[COMPANY'S INITIALS] [HELLER'S INITIALS]
-------------------- -------------------
Company's Initials Heller's Initials
Section 6.18. Approval of Disbursement Requests. Heller agrees to
approve disbursement requests, tendered to Heller by the Company pursuant to
Article III of the Loan Agreements, within three (3) Business Days of their
tender: (1) to pay, or reimburse Heller for paying, principal of and interest on
the Bonds; and (2) for other uses authorized by the Bond Documents, if as of the
date of approval (a) no Event of Default exists hereunder, (b) no "Default"
exists under the Credit Agreement, (c) after giving effect to such disbursement,
the "Leverage Ratio" (as hereinafter defined) as of the date of approval does
not exceed the amount set forth below for such date:
Date of Disbursement Leverage Ratio
- -------------------- --------------
Closing Date through March 31, 1995 4.75
April 1, 1995 through March 31, 1996 4.25
April 1, 1996 through March 31, 1997 3.75
April 1, 1997 and thereafter 3.00, and
(d) three (3) Business Days prior to the requested disbursement date, Heller
shall have received a written notice from the Company showing the Company's
calculation of the Leverage Ratio as of the date of said notice (but after
giving effect to the requested disbursement) and containing the Company's
certification that the conditions specified herein have been, and as of the
disbursement date will be, satisfied. Heller shall have the right, in its sole
discretion, to waive any or all of the foregoing conditions.
For purposes of this Agreement, the term "Leverage Ratio" means, as
of any date, (a) "Adjusted Total Debt" (as hereinafter defined) as of such date
divided by (b) (i) "EBIDAT" (as defined in the Credit Agreement) for the
12-month period ending on the last day of the immediately preceding calendar
month for which Heller has received the financial statements required to be
delivered pursuant to Section 5.1(A) of the Credit Agreement, minus (ii)
"Capital Expenditures" (as defined in the Credit Agreement) of Holdings and its
Subsidiaries paid in cash during said 12-month period other than those Capital
Expenditures financed with proceeds of the Bonds.
For purposes of the foregoing paragraph, the term "Adjusted Total
Debt" means, as of any date, (a) the sum of the outstanding principal balances
of all "Loans" (as defined in the Credit Agreement) and all other Indebtedness
of the Company, "Holdings" and "ITB" (as such terms are defined in the Credit
Agreement), plus (b) the amount of "Lender Guaranty Reserve" (as defined in the
Credit Agreement), minus (c) to the extent included in (a) above, Indebtedness
to the Issuer under the Loan Agreements, plus (d) the sum of the amount of the
requested disbursement and all other disbursements theretofore made, including
disbursements made, or other costs and expenses paid from Bond proceeds at
closing, minus (e) prepayments of the Bonds made by the Company pursuant to
Section 4.6 hereof.
-24-
Please signify your agreement and acceptance of the foregoing by
executing this Agreement in the space provided below.
Very truly yours,
HELLER FINANCIAL, INC.
By: /s/ Karen L. Finnerty
--------------------------------
Assistant Vice President
Accepted and agreed to:
ROLLER BEARING COMPANY OF AMERICA, INC.
By: /s/ [ILLEGIBLE]
--------------------------------
CEO and Treasurer
-25-
APPENDIX I
FORM OF IRREVOCABLE TRANSFERABLE LETTER OF CREDIT
September 7,1994
**U.S. $10,853,904.l1**
MARK TWAIN BANK, as trustee (the
"Trustee") under two Trust Inden-
tures, each dated as of September
1, 1994, and each between the South
Carolina Jobs-Economic Development
Authority (the "Issuer") and the
Trustee (collectively, the "Indentures")
8820 Ladue Road
St. Louis, Missouri 63124
Attention: Corporate Trust Division
Ladies and Gentlemen:
We hereby establish in your favor as Trustee for the benefit of the
holders of the Bonds (as hereinafter defined) our Irrevocable Transferable
Letter of Credit No. 94-RBC01 for the account of Roller Bearing Company of
America, Inc., a Delaware corporation (the "Company"), whereby we hereby
irrevocably authorize you to draw on us from time to time, from and after the
date hereof to and including the earliest to occur of: (i) our close of business
on September 15, 1999 (the "Stated Expiration Date"), (ii) the date which is ten
(10) days following your receipt of written notice from us of the occurrence of
an Event of Default under the Letter of Credit Agreement, dated as of September
1, 1994 (the "Letter of Credit Agreement"), between the Company and us, and a
direction to cause the acceleration (or, at our option, a mandatory purchase in
lieu of acceleration) of all outstanding Bonds pursuant to the Indentures; (iii)
the date on which all Bonds are paid or deemed paid under the terms of the
Indentures; (iv) the date on which the Bonds become secured by an Alternate
Credit Facility (as defined in the Letter of Credit Agreement) in accordance
with the terms of the Indentures; or (v) the earlier of (A) the date which is
five (5) days after the Conversion Date (as defined in the Letter of Credit
Agreement), or (B) the date on which we honor a drawing under the Letter of
Credit on or after the Conversion Date (the earliest of such dates herein
referred to as the "Termination Date"), a maximum aggregate amount not exceeding
Ten Million Eight Hundred Fifty-Three Thousand Nine Hundred Four and Eleven
Hundredths United States Dollars (U.S. $10,853,904.11 - the "Original Stated
Amount") to pay principal of and interest on, or the purchase price of,
$7,700,000 of the Issuer's Variable Rate Demand Industrial Development Revenue
Bonds (Roller Bearing Company of America, Inc. Project) Series 1994A (the
"Series 1994A Bonds"), and $3,000,000 of the Issuer's Variable Rate Demand
Industrial Development Revenue Bonds (Roller Bearing Company of America, Inc.
Project) Series 1994B (the "Series 1994B Bonds" and, together with the Series
1994A Bonds, the "Bonds"), in accordance with the
-26-
terms hereof, said $10,853,904.11 having been initially calculated to be equal
to $10,700,000 (the original principal amount of the Bonds), plus $153,904.11
(35 days' accrued interest on the original principal amount of the Bonds at the
Cap Interest Rate applicable thereto (based on a year consisting of 365 days),
as defined in the Letter of Credit Agreement) available against the following
documents (the "Payment Documents") presented to Heller Financial, Inc.
("Heller") at our office at 500 West Monroe Street, 12th Floor, Chicago,
Illinois 60661 (or such other place as we may from time to time specify),
Attention: Portfolio Manager, Portfolio Organization, Corporate Finance Group
(or such other person as we may from time to time specify):
A certificate (with all blanks appropriately completed) (i) in the
form attached as Exhibit C hereto to pay interest on the Bonds, which drawing is
provided for under Section 508(b)(l) of each Indenture (an "Interest Drawing"),
(ii) in the form attached as Exhibit D hereto to pay the principal amount of and
interest on the Bonds in respect of any redemption of the Bonds as provided for
in Section 508(b)(3) of each Indenture (a "Redemption Drawing"), provided that
in the event the date of redemption coincides with an Interest Payment Date (as
defined in the Letter of Credit Agreement) the Redemption Drawing shall not
include any interest on the Bonds (which interest is payable pursuant to an
Interest Drawing), (iii) in the form attached as Exhibit E hereto, to allow the
Trustee, as Tender Agent, to pay the purchase price of Bonds on any Purchase
Date (as defined in the Letter of Credit Agreement) as provided for in Section
508(b)(4) or (5) of each Indenture to the extent Remarketing Proceeds (as
defined in the Indentures) are not otherwise available for such purpose (a
"Liquidity Drawing"), provided that in the event the Purchase Date coincides
with an Interest Payment Date, the Liquidity Drawing shall not include any
interest on the Bonds (which interest is payable pursuant to an Interest
Drawing), (iv) in the form of Exhibit F hereto to pay the principal of and, in
the event the date of acceleration does not coincide with a regularly scheduled
Interest Payment Date, interest in respect of any acceleration of the Bonds
pursuant to Section 508(b)(6) of each Indenture (an "Acceleration Drawing"),
stating therein that it is given by your duly authorized officer and dated the
date such certificate is presented hereunder. No drawings shall be made under
this Letter of Credit for Company Bonds (as defined in the Letter of Credit
Agreement). Any defined terms which are not expressly defined in this paragraph
shall have the same meaning herein as in the Indentures. For purposes of this
paragraph, the term "interest" shall be deemed to mean interest accruing on the
Bonds through the date set forth in the Indentures.
All drawings shall be made by presentation of each Payment Document
at our office at 500 West Monroe Street, 12th Floor, Chicago, Illinois 60661 as
aforesaid, or by telecopier (at telecopier number (312) 441-7367), Attention:
Portfolio Manager, Portfolio Organization, Corporate Finance Group, without
further need of documentation, including without need of the original of this
Letter of Credit, it being understood that each Payment Document so submitted is
to be the sole operative instrument of drawing. You shall use your best efforts
to give telephonic notice of a drawing to us at the foregoing address (telephone
number (312) 441-7500) on the Business Day preceding the day of such drawing
(but such notice shall not be a condition to drawing hereunder).
We agree to honor and pay the amount of any Interest, Redemption,
Liquidity or Acceleration Drawing if presented in strict compliance with all of
the terms and conditions of this Letter of Credit. If any such drawing, other
than a Liquidity Drawing, is presented in strict
-27-
compliance with all of the terms and conditions hereof prior to 12:00 Noon,
Chicago, Illinois time (1:00 P.M., New York City time), on a Business Day, we
will confirm to you the wire transfer of the amount specified, in immediately
available funds, and will notify you of the Federal Reserve Bank confirmation
number relating to such transfer, by 2:30 P.M., Chicago, Illinois time (3:30
P.M., New York City time), on the following Business Day. If any such drawing,
other than a Liquidity Drawing, is presented in strict compliance with all of
the terms and conditions hereof at or after 12:00 Noon, Chicago, Illinois time
(1:00 P.M., New York City time) and prior to 4:30 P.M., Chicago, Illinois time
(5:30 P.M., New York City time), on a Business Day, we will confirm to you the
wire transfer of the amount specified, in immediately available funds, and will
notify you of the Federal Reserve Bank confirmation number relating to such
transfer, by 4:00 P.M. Chicago, Illinois time (5:00 P.M., New York City time),
on the following Business Day. If a Liquidity Drawing is presented in strict
compliance with all of the terms and conditions hereof prior to 10:00 A.M.,
Chicago, Illinois time (11:00 A.M., New York City time), on a Business Day, we
will confirm to you the wire transfer of the amount specified, in immediately
available funds, and will notify you of the Federal Reserve Bank confirmation
number relating to such transfer, by 2:00 P.M., Chicago, Illinois time (3:00
P.M., New York City time), on the same Business Day. If a Liquidity Drawing is
presented in strict compliance with all of the terms and conditions hereof at or
after 10:00 A.M., Chicago, Illinois time (11:00 A.M., New York City time) and
prior to 4:30 P.M., Chicago, Illinois time (5:30 P.M., New York City time), on a
Business Day, we will confirm to you the wire transfer of the amount specified,
in immediately available funds, and will notify you of the Federal Reserve Bank
confirmation number relating to such transfer, by 1:00 P.M., Chicago, Illinois
time (2:00 P.M., New York City time), on the following Business Day. Any drawing
presented hereunder after 4:30 P.M., Chicago, Illinois time (5:30 P.M., New York
City time), on a Business Day shall be deemed to have been presented at 9:00
A.M., Chicago, Illinois time (10:00 A.M., New York City time), on the following
Business Day. Payments made hereunder pursuant to a drawing shall be made by
wire transfer to Mark Twain Bank, ABA Number 081003408 for credit to Trust
Division, Account Number 3613004595, Reference: Roller Bearing Company of
America, Inc., Attention: Trust Division, Telephone: (314) 889-0750 (or to such
other account number or address as the Trustee may from time to time designate).
"Business Day" means a day which is not (a) a Saturday, Sunday or any other day
on which banking institutions in New York, New York, or the city or cities in
which the principal corporate trust office of the Trustee, the Tender Agent (as
defined in the Indenture) or the Remarketing Agent (as defined in the Indenture)
is located, or in the City of Chicago, Illinois, are required or authorized by
law to close, or (b) other than a day on which the New York Stock Exchange is
closed.
The Available Amount (as hereinafter defined) of this Letter of
Credit will be reduced automatically by the amount of any drawing hereunder;
provided, however, that the amount of any Interest Drawing hereunder, less the
amount of the reduction in the Available Amount of this Letter of Credit
attributable to interest as specified in a certificate in the form of Exhibit D
or G hereto, shall be automatically reinstated immediately upon payment by us of
such drawing. After payment by us of a Liquidity Drawing, our obligation to
honor drawings under this Letter of Credit will be automatically reduced by an
amount equal to the Original Purchase Price of any Bonds (or portions thereof)
purchased pursuant to said drawing. In addition, prior to the Conversion Date,
in the event of the remarketing of the Bonds (or portions thereof in Authorized
Denominations, as defined in the Indenture) previously purchased with the
proceeds of a Liquidity Drawing, our obligation to honor drawings hereunder will
be
-28-
automatically reinstated concurrently upon our receipt, or receipt by the
Trustee or the Tender Agent on our behalf, of an amount equal to the principal
portion of the Original Purchase Price of such Bonds (or portion thereof) plus
all accrued interest thereon, and the amount of such reinstatement shall be
equal to the Original Purchase Price of such Bonds. "Original Purchase Price"
shall mean the principal amount of any Bond purchased with the proceeds of a
Liquidity Drawing plus the amount of accrued interest on such Bond paid with the
proceeds of a Liquidity Drawing (and not pursuant to an Interest Drawing) upon
such purchase.
Upon receipt by us of a certificate of the Trustee in the form of
Exhibit D or G hereto, the Letter of Credit will automatically and permanently
reduce the amount available to be drawn hereunder by the amount specified in
such certificate. Such reduction shall be effective as of the next Business Day
following the date of delivery of such certificate.
Upon any permanent reduction of the amounts available to be drawn
under this Letter of Credit, as provided herein, we may deliver to you a
substitute Letter of Credit in exchange for this Letter of Credit or an
amendment to this Letter of Credit substantially in the form of Exhibit H hereto
to reflect any such reduction. If we deliver to you such a substitute Letter of
Credit you shall simultaneously surrender to us for cancellation the Letter of
Credit then in your possession. The "Available Amount" shall mean the Original
Stated Amount less (i) the amount of all prior reductions pursuant to Interest,
Redemption, Liquidity or Acceleration Drawings, less (ii) the amount of any
reduction in the Available Amount of this Letter of Credit pursuant to a
reduction certificate in the form of Exhibit D or G hereto to the extent such
reduction is not already accounted for by a reduction in the Available Amount
pursuant to (i) above, plus (ii) the amount of all reinstatements as above
provided.
Prior to the Stated Expiration Date, we may extend the Stated
Expiration Date from time to time at the request of the Company by delivering to
you an amendment to this Letter of Credit in the form of Exhibit J hereto
designating the date to which the Stated Expiration Date is being extended. Each
such extension of the Stated Expiration Date shall become effective on the
Business Day following delivery of such amendment to you, and thereafter all
references in this Letter of Credit to the Stated Expiration Date shall be
deemed to be references to the date designated as such in such amendment. Any
date to which the Stated Expiration Date has been extended as herein provided
may be extended in a like manner.
Prior to the Stated Expiration Date, we may increase the amount of
the interest component of this Letter of Credit (by increasing the Cap Rate
applicable hereto) from time to time at the request of the Company by delivering
to you an amendment to this Letter of Credit in the form of Exhibit K hereto
designating the increased amount of the interest component of this Letter of
Credit. Each such increase in the amount of the interest component of this
Letter of Credit shall become effective on the Business Day following delivery
of such amendment to you, and thereafter all references in this Letter of Credit
to the amount of the interest component of this Letter of Credit shall be deemed
to be references to the increased amount designated as such in such amendment.
Any increase in the amount of the interest component of this Letter of Credit as
herein provided may be increased in a like manner.
Upon the Termination Date this Letter of Credit shall automatically
terminate and be delivered by you to us for cancellation.
-29-
This Letter of Credit is transferable in whole only to your
successor as Trustee. Any such transfer (including any successive transfer)
shall be effective upon receipt by us (which receipt shall be subsequently
confirmed in writing to the transferor and the transferee by us) of a signed
copy of the instrument effecting each such transfer signed by the transferor and
by the transferee in the form of Exhibit I hereto (which shall be conclusive
evidence of such transfer) and, in such case, the transferee instead of the
transferor shall, without the necessity of further action, be entitled to all
the benefits of and rights under this Letter of Credit in the transferor's
place; provided that, in such case, any certificates to be provided by you
hereunder shall be signed by one who states therein that he or she is a duly
authorized officer or agent of the transferee.
Communications with respect to this Letter of Credit shall be
addressed to us at Heller Financial, Inc., 500 West Monroe Street, 12th Floor,
Chicago, Illinois 60661, Attention: Portfolio Manager, Portfolio Organization,
Corporate Finance Group, specifically referring to the number of this Letter of
Credit.
This Letter of Credit shall be governed by, and construed in
accordance with, the laws of the State of Illinois, including, without
limitation, the Uniform Commercial Code as in effect in the State of Illinois.
All payments made by us hereunder shall be made with our funds and
not with the funds of any other person.
This Letter of Credit sets forth in full terms of our undertaking,
and such undertaking shall not in any way be modified or amended by reference to
any other document whatsoever.
HELLER FINANCIAL, INC.
By:
------------------------------
Assistant Vice President
-30-
EXHIBIT A
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
NOTICE OF CONVERSION DATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
Dear Sirs:
Reference is hereby made to that certain Irrevocable Transferable
Letter of Credit No. 94-RBC01, dated September 7, 1994 (the "Letter of Credit"),
which has been established by you for the account of Roller Bearing Company of
America, Inc., a Delaware corporation, in favor of the Trustee.
The undersigned hereby certifies and confirms that the Conversion
Date has occurred on [insert date], and, accordingly, said Letter of Credit
shall terminate 5 days after such Conversion Date in accordance with its terms.
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
MARK TWAIN BANK,
as Trustee
By:
-----------------------------
Authorized Representative
-31-
EXHIBIT B
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
NOTICE OF TERMINATION
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
Dear Sirs:
Reference is hereby made to that certain Irrevocable Transferable
Letter of Credit No. 94-RBC0l, dated September 7, 1994 (the "Letter of Credit"),
which has been established by you for the account of Roller Bearing Company of
America, Inc., a Delaware corporation, in favor of the Trustee.
The undersigned hereby certifies and confirms that [no Bonds remain
Outstanding within the meaning of the Indentures/all drawings required to be
made under the Indentures and available under the Letter of Credit have been
made and honored/an Alternate Credit Facility has been issued to replace the
Letter of Credit in accordance with the Indentures and the Letter of Credit
Agreement]*, and, accordingly, the Letter of Credit shall be terminated in
accordance with its terms and you shall have no further liability thereon.
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
MARK TWAIN BANK,
as Trustee
By:
-----------------------------
Authorized Representative
- ----------
* Insert appropriate statement.
-32-
EXHIBIT C
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC0l
INTEREST DRAWING CERTIFICATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
The undersigned individual, a duly authorized officer of Mark Twain
Bank (the "Beneficiary"), hereby CERTIFIES on behalf of the Beneficiary as
follows with respect to (i) that certain Irrevocable Transferable Letter of
Credit No. 94-RBC0l, dated September 7, 1994 (the "Letter of Credit"), issued by
Heller Financial, Inc. ("Heller") in favor of the Beneficiary; (ii) those
certain Bonds; and (iii) those certain Indentures:
1. The Beneficiary is the Trustee under the Indentures.
2. The Beneficiary is entitled to make this drawing in the amount of
$[insert amount] under the Letter of Credit pursuant to the Indentures with
respect to the payment of interest due on all Bonds Outstanding on the Interest
Payment Date occurring on [insert date], other than Company Bonds.
3. (a) The amount of this drawing is equal to the amount required to
be drawn by the Trustee pursuant to Section 508(b)(1) of the Indentures.
(b) Of the amount stated in paragraph 2 above:
(i) $[insert amount] is demanded in respect of interest on the
Series 1994A Bonds (as defined in the Letter of Credit); and
(ii) $[insert amount] is demanded in respect of interest on
the Series 1994B Bonds (as defined in the Letter of Credit).
4. The amount of this drawing was computed in compliance with the
terms of the Indentures and, when added to the amount of any other drawing under
the Letter of Credit made simultaneously herewith, does not exceed the Available
Amount of the Letter of Credit.
-33-
5. The proceeds of this drawing will only be used to pay interest on
Bonds in a Weekly Mode.
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
IN WITNESS WHEREOF, this Certificate has been executed this ____ day
of _________, ____.
MARK TWAIN BANK,
as Trustee
By:
-----------------------------
Authorized Representative
-34-
EXHIBIT D
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
REDEMPTION DRAWING AND REDUCTION CERTIFICATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
The undersigned individual, a duly authorized officer of Mark Twain
Bank (the "Beneficiary"), hereby CERTIFIES on behalf of the Beneficiary as
follows with respect to (i) that certain Irrevocable Transferable Letter of
Credit No. 94-RBC01, dated September 7, 1994 (the "Letter of Credit"), issued by
Heller Financial, Inc. ("Heller") in favor of the Beneficiary; (ii) those
certain Bonds; and (iii) those certain Indentures:
1. The Beneficiary is the Trustee under the Indentures.
2. The Beneficiary is entitled to make this drawing in the amount of
$[insert amount] under the Letter of Credit pursuant to Section 508(b)(3) of the
Indentures.
3. (a) The amount of this drawing is equal to (i) the principal
amount of Bonds to be redeemed by the Issuer pursuant to Section [insert Section
number] of the Indentures on [insert date] (the "Redemption Date") other than
Company Bonds, plus (ii) interest accrued from the immediately preceding
Interest Payment Date to the Redemption Date, provided that in the event the
Redemption Date coincides with an Interest Payment Date this drawing shall not
include any accrued interest on such Bonds.
(b) Of the amount stated in paragraph 2 above:
(i) $[insert amount] is demanded in respect of the principal
amount of the Series 1994A Bonds;
(ii) $[insert amount] is demanded in respect of the principal
amount of the Series 1994B Bonds;
(iii) $[insert amount] is demanded in respect of interest on
such Series 1994A Bonds; and
-35-
(iv) $[insert amount] is demanded in respect of interest on
such Series 1994B Bonds.
4. The amount of the drawing made by this Certificate was computed
in compliance with the terms and conditions of the Indentures and, when added to
the amount of any other drawing under the Letter of Credit made simultaneously
herewith, does not exceed the Available Amount of the Letter of Credit.
5. Upon payment of the amount drawn hereunder, Heller is hereby
directed to permanently reduce the Available Amount of the Letter of Credit by
$[insert amount of reduction] and the Available Amount shall thereupon equal
$[insert new Available Amount].
6. Of the amount of the reduction stated in paragraph 5 above:
(i) $[insert amount] is attributable to the principal amount
of the Series 1994A Bonds redeemed;
(ii) $[insert amount] is attributable to the principal amount
of the Series 1994B Bonds redeemed;
(iii) $[insert amount] is attributable to interest on such
Series 1994A Bonds (i.e., [insert number of days] days' interest
thereon at the Cap Interest Rate); and
(iv) $[insert amount] is attributable to interest on such
Series 1994B Bonds (i.e., [insert number of days] days' interest
thereon at the Cap Interest Rate).
7. The amount of the reduction in the Available Amount of the Letter
of Credit has been computed in accordance with the provisions of the Letter of
Credit Agreement.
8. Following the reduction, the Available Amount of the Letter of
Credit shall be at least equal to the aggregate principal amount of the Bonds
Outstanding (to the extent such Bonds are not Company Bonds), plus interest
thereon at the Cap Interest Rate (as defined in the Letter of Credit Agreement)
applicable thereto for a period of 35 days (based on a year consisting of 365
days).
9. The proceeds of this drawing will only be used to pay principal
of and accrued interest on Bonds in a Weekly Mode.
[10. The Trustee, prior to giving notice of redemption to the
registered owners of the Bonds, received written evidence from Heller that
Heller has consented to such redemption.]*
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
-36-
IN WITNESS WHEREOF, this Certificate has been executed this
__________ day of __________, ______.
MARK TWAIN BANK,
as Trustee
By:
-----------------------------
Authorized Representative
- ----------
* To be included in a certificate only if Section 401(a) of the Indentures is
referenced in paragraph numbered 3 above.
-37-
EXHIBIT E
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
LIQUIDITY DRAWING CERTIFICATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
The undersigned individual, a duly authorized officer of Mark Twain
Bank (the "Beneficiary") hereby CERTIFIES as follows with respect to (i) that
certain Irrevocable Transferable Letter of Credit No. 94-RBC01, dated September
7, 1994 (the "Letter of Credit"), issued by Heller Financial, Inc. ("Heller") in
favor of the Beneficiary; (ii) those certain Bonds; and (iii) those certain
Indentures:
1. The Beneficiary is the Tender Agent, acting as agent of the
Trustee under the Indentures.
2. The Beneficiary is entitled to make this drawing under the Letter
of Credit in the amount of $[insert amount] under the Letter of Credit pursuant
to Section 508(b)(4) or (5) with respect to the payment of the purchase price of
Bonds pursuant to Section 301 or 302 of the Indentures to be purchased on
[insert date] (the "Purchase Date"), which Bonds have not been remarketed as
provided in the Indentures or the purchase price of which has not been received
by the Tender Agent by 9:00 a.m. (Chicago, Illinois time) on said Purchase Date.
3. (a) The amount of this drawing is equal to (i) the principal
amount of Bonds to be purchased pursuant to the Indentures on the Purchase Date
other than Company Bonds, plus (ii) interest on such Bonds accrued from the
immediately preceding Interest Payment Date (or, if none, the date of the
issuance of the Bonds) to the Purchase Date (provided that in the event the
Purchase Date coincides with an Interest Payment Date this drawing shall not
include any interest on such Bonds), less (iii) the amount of proceeds from the
remarketing of such Bonds received by the Tender Agent from the Remarketing
Agent on or prior to the Purchase Date.
(b) Of the amount stated in paragraph 2 above:
-38-
(i) $[insert amount] is demanded in respect of the principal
portion of the purchase price of the Series 1994A Bonds;
(ii) $[insert amount] is demanded in respect of the principal
portion of the purchase price of the Series 1994B Bonds;
(iii) $[insert amount] is demanded in respect of the interest
portion of the purchase price of such Series 1994A Bonds; and
(iv) $[insert amount] is demanded in respect of the interest
portion of the purchase price of such Series 1994B Bonds.
4. The amount of the drawing made by this Certificate was computed
in compliance with the terms and conditions of the Indentures and, when added to
the amount of any other drawing under the Letter of Credit made simultaneously
herewith, does not exceed the Available Amount of the Letter of Credit.
5. The Beneficiary will register or cause to be registered in the
name of Roller Bearing Company of America, Inc., a Delaware corporation, as
registered owner, and in the name of Heller, as pledgee, as provided in Section
307(d)(2) of the Indentures, upon payment of the amount drawn hereunder, Series
1994A Bonds and Series 1994B Bonds in the principal amount of the Series 1994A
Bonds and the Series 1994B Bonds, respectively, being purchased with the amounts
drawn hereunder and will deliver such Series 1994A Bonds and Series 1994B Bonds
to the Trustee in accordance with the Indentures.
6. The proceeds of this drawing will only be used to pay the
purchase price of Bonds in a Weekly Mode.
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
IN WITNESS WHEREOF, this Certificate has been executed this
_________ day of __________, _____.
MARK TWAIN BANK,
as Trustee
By:
----------------------------
Authorized Representative
-39-
EXHIBIT F
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
ACCELERATION DRAWING CERTIFICATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
The undersigned individual, a duly authorized officer of Mark Twain
Bank (the "Beneficiary"), hereby CERTIFIES on behalf of the Beneficiary as
follows with respect to (i) that certain Irrevocable Transferable Letter of
Credit No. 94-RBC01, dated September 7, 1994 (the "Letter of Credit"), issued by
Heller Financial, Inc. ("Heller") in favor of the Beneficiary; (ii) those
certain Bonds; and (iii) those certain Indentures:
1. The Beneficiary is the Trustee under the Indentures.
2. An Event of Default has occurred under subsection [insert
subsection number] of Section 801 of the Indentures and the Trustee has declared
the principal of and accrued interest on all Bonds to be immediately due and
payable. The Beneficiary is entitled to make this drawing in the amount of
$[insert amount] under the Letter of Credit pursuant to Section 508(b)(6) of the
Indentures in order to pay the principal of and interest on the Bonds due to an
acceleration thereof in accordance with Section 802 of the Indentures.
3. (a) The amount of this drawing is equal to (i) the principal
amount of the Bonds outstanding on [insert date of acceleration] (the
"Acceleration Date") other than Company Bonds, plus (ii) if the Acceleration
Date does not coincide with a regularly scheduled Interest Payment Date,
interest on such Bonds from the immediately preceding Interest Payment Date (or,
if none, the date of issuance of the Bonds) to the Acceleration Date.
(b) Of the amount stated in paragraph 2 above:
(i) $[insert amount] is demanded in respect of the principal
amount of the Series 1994A Bonds;
(ii) $[insert amount] is demanded in respect of the principal
amount of the Series 1994B Bonds;
-40-
(iii) $[insert amount] is demanded in respect of interest on
such Series 1994A Bonds; and
(iv) $[insert amount] is demanded in respect of interest on
such Series 1994B Bonds.
4. The amount of this drawing was computed in compliance with the
terms and conditions of the Indentures and, when added to the amount of drawing
under the Letter of Credit made simultaneously herewith, does not exceed the
Available Amount of the Letter of Credit.
5. The proceeds of this drawing will only be used to pay principal
of and interest on Bonds in a Weekly Mode.
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
IN WITNESS WHEREOF, this Certificate has been executed this
_________ day of ___________ , _____.
MARK TWAIN BANK,
as Trustee
By:
---------------------------
Authorized Representative
-41-
EXHIBIT G
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
REDUCTION CERTIFICATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
The undersigned hereby CERTIFIES with respect to (i) that certain
Irrevocable Transferable Letter of Credit No. 94-RBC01, dated September 7, 1994
(the "Letter of Credit"), issued by Heller Financial, Inc. ("Heller") in favor
of the Beneficiary; (ii) those certain Bonds; and (iii) those certain
Indentures:
1. The Beneficiary is the Trustee under the Indentures.
2. Upon receipt by Heller of this Certificate, the Available Amount
shall be reduced by $[insert amount], and the Available Amount shall thereupon
equal $[insert amount]. $[insert amount] of said amount is attributable to
interest.
3. The amount of the reduction in the Available Amount of the Letter
of Credit has been computed in accordance with the provisions of the Letter of
Credit Agreement.
4. Following the reduction, the Available Amount of the Letter of
Credit shall equal the aggregate principal amount of the Bonds outstanding (to
the extent such Bonds are not Company Bonds), plus 35 days' interest on the
Bonds at the Cap Interest Rate, based upon a year consisting of 365 days.
All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Letter of Credit and the Letter of Credit
Agreement (as defined in the Letter of Credit).
-42-
IN WITNESS WHEREOF, this Certificate has been executed this
_________ day of __________, ____.
MARK TWAIN BANK,
as Trustee
By:
-------------------------------
Authorized Representative
-43-
EXHIBIT H
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
NOTICE OF AMENDMENT
(REDUCTION)
Mark Twain Bank
8820 Ladue Road
St. Louis, Missouri 63124
Attention: Corporate Trust Division
Dear Sirs:
Reference is made to that certain Irrevocable Transferable Letter of
Credit No. 94-RBC01, dated September 7, 1994 (the "Letter of Credit"),
established by us in your favor as Beneficiary. We hereby notify you that, in
accordance with the terms of the Letter of Credit and that certain Letter of
Credit Agreement, dated as of September 1, 1994, between Roller Bearing Company
of America, Inc., a Delaware corporation, and us, the Available Amount of the
Letter of Credit has been reduced to $[insert amount].
This letter should be attached to the Letter of Credit and made a
part thereof.
HELLER FINANCIAL, INC.
By:
------------------------------
Its:
-------------------------
-44-
EXHIBIT I
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
TRANSFER CERTIFICATE
Heller Financial, Inc.
500 West Monroe Street
12th Floor
Chicago, Illinois 60661
Attention: Portfolio Manager,
Portfolio Organization,
Corporate Finance Group
Dear Sirs:
Reference is made to that certain Irrevocable Transferable Letter of
Credit No. 94-RBC01, dated September 7, 1994 (the "Letter of Credit"), which has
been established by you in favor of Mark Twain Bank.
The undersigned, a duly authorized officer or agent of Mark Twain
Bank has transferred and assigned (and hereby confirms to you said transfer and
assignment) all of its rights under and interest in said Letter of Credit to
[insert name of transferee], and confirms that Mark Twain Bank no longer has any
rights under or interest in said Letter of Credit.
Transferor and Transferee have indicated on the face of said Letter
of Credit that it has been transferred and assigned to Transferee.
The undersigned, a duly authorized officer or agent of the
Transferee hereby certifies that the Transferee is a duly authorized transferee
under the terms of said Letter of Credit and is accordingly entitled, upon
presentation of the documents called for therein, to receive payment thereunder.
MARK TWAIN BANK,
as Transferor
By:
----------------------------
Authorized Officer
--------------------------------
as Transferee
By:
----------------------------
Authorized Officer
-45-
EXHIBIT J
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
NOTICE OF AMENDMENT
(STATED EXPIRATION DATE)
Mark Twain Bank
8820 Ladue Road
St. Louis, Missouri 63124
Attention: Corporate Trust Division
Dear Sirs:
Reference is made to that certain Irrevocable Transferable Letter of
Credit No. 94-RBC01, dated September 7, 1994 (the "Letter of Credit"),
established by us in your favor as Beneficiary. We hereby notify you that, in
accordance with the terms of the Letter of Credit and that certain Letter of
Credit Agreement, dated as of September 1, 1994, between Roller Bearing Company
of America, Inc., a Delaware corporation, and us, the Stated Expiration Date of
the Letter of Credit has been extended to [insert date].
This letter should be attached to the Letter of Credit and made a
part thereof.
HELLER FINANCIAL, INC.
By:
---------------------------
Its:
----------------------
-46-
EXHIBIT K
TO
HELLER FINANCIAL, INC.
LETTER OF CREDIT
NO. 94-RBC01
NOTICE OF AMENDMENT
(INTEREST COMPONENT)
Mark Twain Bank
8820 Ladue Road
St. Louis, Missouri 63124
Attention: Corporate Trust Division
Dear Sirs:
Reference is made to that certain Irrevocable Transferable Letter of
Credit No. 94-RBC01, dated September 7,1994 (the "Letter of Credit"),
established by us in your favor as Beneficiary. We hereby notify you that, in
accordance with the terms of the Letter of Credit and that certain Letter of
Credit Agreement, dated as of September 1, 1994, between Roller Bearing Company
of America, Inc., a Delaware corporation, and us, the interest component of the
Letter of Credit has been increased to $[insert amount based on 35 days'
interest (365-day year) at the new Cap Rate].
This letter should be attached to the Letter of Credit and made a
part thereof.
HELLER FINANCIAL, INC.
By:
----------------------------
Its:
-----------------------
-47-