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LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
by and between
▇▇▇▇▇▇ RIVERSIDE, LLC
and
NATIONSBANK, N.A.
Dated as of November 1, 1997
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Table of Contents
Page
Article Definitions........................................................................ 1
Section 1.1 Definitions........................................................................ 1
Section 1.2 General............................................................................ 9
Article 2. Amount and Terms of the Letter of Credit........................................... 10
Section 2.1 Issuance of the Letter of Credit................................................... 10
Section 2.2 Reimbursement Obligation........................................................... 10
Section 2.3 Letter of Credit Commission........................................................ 10
Section 2.4 Payments and Computations.......................................................... 11
Section 2.5 Obligations Absolute............................................................... 12
Section 2.6 Commercial Practices............................................................... 12
Section 2.7 Increased Costs.................................................................... 13
Section 2.8 Payments Net of Taxes, Etc......................................................... 13
Section 2.9 AGREEMENT REGARDING INTEREST AND CHARGES........................................... 14
Section 2.10 Evidence of Obligations............................................................ 14
Section 2.11 Extension of Stated Expiration Date................................................ 15
Section 2.12 Alternate Letter of Credit......................................................... 15
Section 2.13 Remarketing........................................................................ 15
Article 3. Conditions of Issuance............................................................. 16
Section 3.1 Condition Precedent to Issuance of the Letter of Credit............................ 16
Section 3.2 Additional Conditions Precedent to Issuance of the Letter of Credit................ 22
Section 3.3 Covenant to Deliver................................................................ 22
Section 3.4 Conditions Precedent to Approval of Requisitions and Related Matters............... 23
Article 4. Representations and Warranties..................................................... 28
Section 4.1 Representations and Warranties of the Company...................................... 28
Section 4.2 Survival of Representations and Warranties........................................ 32
Article 5. Affirmative Covenants.............................................................. 32
Section 5.1 Preservation of Existence and Similar Matters...................................... 32
Section 5.2 Compliance with Applicable Law..................................................... 32
Section 5.3 Maintenance of Property............................................................ 32
Section 5.4 Conduct of Business................................................................ 32
Section 5.5 Insurance.......................................................................... 33
Section 5.6 Payment of Taxes and Claims........................................................ 33
Section 5.7 Accounting Methods and Financial Records........................................... 33
Section 5.8 Visits and Inspections............................................................. 33
Section 5.9 Remarketing Agent, Underwriter and Trustee......................................... 33
Section 5.10 Environmental Law Compliance....................................................... 34
Section 5.11 Registration of Bonds.............................................................. 34
Section 5.12 Financial Covenants................................................................ 34
Article 6 Information........................................................................ 35
Section 6.1 Information........................................................................ 35
Article 7. Negative Covenants................................................................. 37
Section 7.1 Indebtedness for Borrowed Money.................................................... 37
Section 7.2 Guaranties......................................................................... 37
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Section 7.3 Investments........................................................................ 37
Section 7.4 Liens ............................................................................ 37
Section 7.5 Merger, Consolidation and Sale of Assets........................................... 37
Section 7.6 Transaction with Affiliates........................................................ 37
Section 7.7 Plans ................................................................................38
Section 7.8 Loans.................................................................................38
Section 7.9 Change of Name; Change of Address of
Chief Executive Office or Principal Place
of Business in Georgia............................................................. 38
Section 7.10 Judgment........................................................................... 38
Section 7.11 Attachment......................................................................... 38
Article 8. Default............................................................................ 38
Section 8.1 Events of Default.................................................................. 38
Section 8.2 Remedies........................................................................... 40
Section 8.3 Additional Rights.................................................................. 41
Section 8.4 Cash Collateral Account............................................................ 41
Article 9. Miscellaneous...................................................................... 43
Section 9.1 Notices............................................................................ 43
Section 9.2 Fees and Expenses.................................................................. 44
Section 9.3 Litigation......................................................................... 45
Section 9.4 Right of Set Off................................................................... 46
Section 9.5 Indemnification.................................................................... 47
Section 9.6 Amendments......................................................................... 48
Section 9.7 Survival........................................................................... 48
Section 9.8 Titles and Captions................................................................ 48
Section 9.9 Severability of Provisions......................................................... 48
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Section 9.10 GOVERNING LAW...................................................................... 49
Section 9.11 Assignment......................................................................... 49
Section 9.12 Participations..................................................................... 49
Section 9.13 Further Assurances................................................................. 49
Section 9.14 Counterparts....................................................................... 49
Section 9.15 ENTIRE AGREEMENT................................................................... 50
EXHIBIT A Form of Letter of Credit
EXHIBIT B Form of Pledge Agreement
EXHIBIT C Form of Extension Request
EXHIBIT D Form of Opinion of Counsel
EXHIBIT E Development Cost Breakdown
EXHIBIT F Amortization Schedule
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LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT, dated as of November 1,
1997, by and between ▇▇▇▇▇▇ RIVERSIDE, LLC, a Georgia limited liability company
(the "Company"), and NATIONSBANK, N.A. (the "Bank").
WHEREAS, the Development Authority of ▇▇▇▇▇▇▇ County (the "Issuer") is
to issue $11,000,000 in aggregate principal amount of its Taxable Industrial
Development Revenue Bonds (▇▇▇▇▇▇ Riverside, LLC Project), Series 1997, (the
"Bonds"), pursuant to a Trust Indenture, dated as of November 1, 1997 (the
"Indenture"), by and between the Issuer and AmSouth Bank, as trustee (the
"Trustee"), for the purpose of financing the acquisition, construction and
equipping of a facility for the manufacturing of store fixtures, bank fixtures
and display units for retail outlets, to be owned by the Company and to be
leased to and operated by ▇▇▇▇▇▇ Fixture Corporation, a corporation organized
under the laws of the State of Georgia;
WHEREAS, pursuant to the terms of a Lease Agreement, dated as of
November 1, 1997 (the "Agreement"), by and between the Issuer and the Company,
the Issuer has leased the Project to the Company and has agreed to allow the
Company to use the proceeds received by the Issuer from the issuance of the
Bonds to finance the Project and the Company has agreed to pay amounts under the
Agreement to the Issuer at such times and in such amounts as necessary to
provide for the payment of the principal of, premium (if any) and interest on,
and the purchase price of, the Bonds when due;
WHEREAS, in order to fulfill the requirements of the Indenture, the
Company has requested that the Bank issue an irrevocable, direct-pay letter of
credit for the benefit of the Trustee and for the account of the Company, to
provide a credit facility for payment of the principal of and interest on the
Bonds on the scheduled due dates and upon redemption or acceleration and upon
tender for purchase; and
WHEREAS, the obligations of the Company under this Reimbursement
Agreement and the other Related Documents shall be secured by the guaranties
(the "Affiliate Guaranties") of ▇▇▇▇▇▇ Industries, Inc. ("▇▇▇▇▇▇ Industries")
and ▇▇▇▇▇▇ Properties, Inc. ("▇▇▇▇▇▇ Properties"), corporations organized under
the laws of the State of Georgia sometimes referred to hereinafter,
individually, as an "Affiliate Guarantor" and, collectively, as the "Affiliate
Guarantors"), and the grant of a Lien in the other Collateral.
NOW, THEREFORE, in consideration of the premises, in order to induce
the Bank to issue such letter of credit and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by
the parties hereto, the parties hereto agree as follows:
ARTICLE 1. DEFINITIONS.
Section 1.1. Definitions.
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For the purposes of this Reimbursement Agreement, the following terms
have the following meanings:
"Acquisition," as applied to any Business Unit or Investment, means the
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acquiring or acquisition of a controlling interest in such Business Unit or
Investment by purchase, exchange, issuance of stock or other securities, or by
merger, reorganization or any other method.
"Affiliate" means, with respect to any Person, any entity which
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directly or indirectly controls, is controlled by, or is under common control
with, such Person or any Subsidiary of such Person or any Person who is a
director, officer or partner of such Person or any Subsidiary of such Person.
For purposes of this definition, "control" means the possession, directly or
indirectly, of the power to (a) vote ten percent (10%) or more of the securities
having ordinary voting power for the election of directors of such Person or (b)
direct or cause the direction of management and policies of a business, whether
through the ownership of voting securities, by contract or otherwise and either
alone or in conjunction with others or any group.
"Affiliate Guaranties" means the Guaranties of ▇▇▇▇▇▇ Industries, Inc.
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and ▇▇▇▇▇▇ Properties, Inc. guaranteeing the obligations of the Company
hereunder.
"Affiliate Guarantors" means ▇▇▇▇▇▇ Industries, Inc. and ▇▇▇▇▇▇
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Properties, Inc. who shall execute and deliver their respective Affiliate
Guaranties guaranteeing the obligations of the Company hereunder.
"Agreement" means the Lease Agreement, dated as of November 1, 1997,
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by and between the Issuer and the Company.
"Applicable Law" means all applicable provisions of constitutions,
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statutes, rules, regulations and orders of all governmental bodies and all
orders and decrees of all courts and arbitrators.
"Bank" means NationsBank, N.A.
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"Bond Purchase Agreement" means the Bond Purchase Agreement, dated as
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of November 12, 1997, by and among the Company, the Issuer and the Underwriter.
"Bond Purchasers" means the purchasers of the Bonds.
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"Bonds" has the meaning given that term in the Indenture.
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"Business Day" means any Monday, Tuesday, Wednesday, Thursday or Friday
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on which each of the Bank, the Trustee and the Remarketing Agent is open for
business; provided, that for purposes of counting the number of Business Days
prior to a given day, "Business Day" means any Monday, Tuesday, Wednesday,
Thursday or Friday on which each of the Bank, the Trustee and the Remarketing
Agent is scheduled to be open for business regardless of whether each such
entity is in fact open for business on such day.
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"Business Unit" means the assets constituting the business or a
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division or operating unit thereof of any Person.
"Capitalized Lease Obligation" means Indebtedness represented by
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obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with generally accepted accounting principles,
and the amount of such Indebtedness shall be the capitalized amount of such
obligations determined in accordance with such principles.
"Cash Collateral Account" means a special non-interest-bearing cash
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collateral account maintained with the Bank, in the name of the Company (as cash
collateral account) but under the sole dominion and exclusive control of the
Bank, subject to the provisions of Section 8.4 hereof.
"Closing Date" means November 12, 1997.
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"Code" means the Internal Revenue Code of 1986, as amended.
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"Collateral" means any real or personal property in which the Company
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or any other Person has granted a Lien as security for any of the Obligations,
including, without limitation, Collateral Securities, Pledged Collateral (as
defined in the Pledge Agreement), the Land, Improvements, Personal Property and
other items set forth in the Deed to Secure Debt and the Trust Estate.
"Collateral Security" has the meaning given that term in Section 8.4.
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(a).
"Company" has the meaning given that term in the introductory paragraph
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of this Reimbursement Agreement.
"Deed to Secure Debt" shall mean that certain Deed to Secure Debt,
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Security Agreement and Assignment of Leases, dated as of November 1, 1997,
executed by the Company in favor of the Bank.
"Default" means the occurrence of any event or occurrence described in
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Section 8.1. hereof which, with the giving of notice or the passage of time or
both, would constitute an Event of Default.
"Default Rate" means a per annum rate equal to the Prime Rate plus one
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percent (1.0%).
"Eligible Securities" means (i) United States Treasury bills with a
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remaining maturity not in excess of 90 days, (ii) negotiable certificates of
deposit of the Bank or of other prime United States commercial banks with a
remaining maturity not in excess of 90 days and (iii) such other instruments
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(within the meaning of Article 9 of the Uniform Commercial Code) as the Company
may request and the Bank may approve in writing.
"Environmental Laws" means any federal, state or local laws, rules or
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ordinances relating to environmental protection, including without limitation,
the following: Clean Air Act, 42 U.S.C. Sections 7401, ET SEQ.; Federal Water
Pollution Control Act, 33 U.S.C. Sections 1251, ET SEQ.; Solid Waste Disposal
Act, 42 U.S.C. Sections 6901, ET SEQ.; Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Sections 9601, ET SEQ.; National
Environmental Policy Act, 42 U.S.C. Sections 4321, ET SEQ.; regulations of the
Environmental Protection Agency and any applicable rule of common law and any
judicial interpretation thereof relating primarily to the environment or
Hazardous Materials.
"Event of Default" means the occurrence of any of the events specified
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in Section 8.1., provided that any requirement for notice or lapse of time or
any other condition has been satisfied.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
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in effect from time to time.
"Governmental Approvals" means all authorizations, consents, approvals,
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licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"Governmental Authority" means any national, state or local government
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(whether domestic or foreign), any political subdivision thereof or any other
governmental, quasi-governmental, judicial, public or statutory instrumentality,
authority, body, agency, bureau or entity (including, without limitation, the
Federal Deposit Insurance Corporation, the Comptroller of the Currency or the
Federal Reserve Board, any central bank or any comparable authority) or any
arbitrator with authority to bind a party at law.
"Guaranty," "Guaranties," "Guaranteed" or to "Guarantee" as applied to
--------- ----------- ---------- ---------
any obligation means and includes:
(a) a guaranty (other than by endorsement of negotiable instruments for
collection in the ordinary course of business), directly or indirectly, in any
manner, of any part or all of such obligation; or
(b) an agreement, direct or indirect, contingent or otherwise, and
whether or not constituting a guaranty, the practical effect of which is to
assure the payment or performance (or payment of damages in the event of
nonperformance) of any part or all of such obligation whether by
(i) the purchase of securities or obligations,
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(ii) the purchase, sale or lease (as lessee or lessor) of
property or the purchase or sale of services primarily for the purpose
of enabling the obligor with respect to such obligation to make any
payment or performance (or payment of damages in the event of
nonperformance) of or on account of any part or all of such obligation,
or to assure the owner of such obligation against loss,
(iii) the supplying of funds to or in any other manner
investing in the obligor with respect to such obligation,
(iv) repayment of amounts drawn down by beneficiaries of
letters of credit, or
(v) the supplying of funds to or investing in a Person on
account of all or any part of such Person's obligation under a Guaranty
of any obligation or indemnifying or holding harmless, in any way, such
Person against any part or all of such obligation.
"Hazardous Materials" means and includes, without limitation, (a)
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hazardous waste as defined in the Resource Conservation and Recovery Act of
1976, or in any other applicable Environmental Laws, (b) hazardous substances,
as defined in the Comprehensive Environmental Response, Compensation and
Liability Act, or in any other applicable Environmental Laws, (c) gasoline, or
any other petroleum product or by-product, (d) toxic substances, as defined in
the Toxic Substances Control Act of 1976, or in any other applicable
Environmental Laws, (e) insecticides, fungicides, or rodenticides, as defined in
the Federal Insecticide, Fungicide, and Rodenticide Act of 1975, or in any other
applicable Environmental Laws, or (f) any hazardous waste, hazardous substances,
hazardous materials, toxic substances or toxic pollutants, as those terms are
used or defined in the Hazardous Materials Transportation Act, the Clean Air Act
or the Clean Water Act, as each such Act, statute or regulation may be amended
from time to time.
"Improvements" means any improvements presently, or hereafter to be
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constructed, on the Land, as more fully described in the Deed to Secure Debt.
"Indebtedness" means and includes, with respect to any Person, all
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items of indebtedness which, in accordance with generally accepted accounting
principles would be included in the determination of liabilities as shown on the
liability side of the balance sheet of such Person as of the date on which
Indebtedness is to be determined.
"Indenture" means the Trust Indenture, dated as of November 1, 1997, by
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and between the Issuer and the Trustee.
"Investment" means, with respect to any Person: (a) any share of
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capital stock, evidence of Indebtedness or other security issued by any other
Person; (b) any loan, advance or extension of credit to, or contribution to the
capital of, any other Person; (c) any Guaranty of the obligation of any other
Person; (d) any other investment (other than the Acquisition of a Business Unit)
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in any other Person (excluding financial instruments utilized solely for cash
management) and (e) any commitment or option to make an Investment in any other
Person.
"Land" means the property to be developed with the proceeds of the
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Bonds, as more fully described in the Deed to Secure Debt.
"Letter of Credit" means the irrevocable, direct-pay Letter of Credit,
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dated November 12, 1997, issued by the Bank for the benefit of the Trustee and
for the account of the Company, in substantially the form of Exhibit A attached
to this Reimbursement Agreement.
"Lien" as applied to the property of any Person means: (a) any
----
mortgage, deed to secure debt, deed of trust, pledge, lien, charge or lease
constituting a Capitalized Lease Obligation, conditional sale or other title
retention agreement, or other security interest, security title or encumbrance
of any kind in respect of any property of such Person, or upon the income or
profits therefrom; (b) any arrangement, express or implied, under which any
property of such Person is transferred, sequestered or otherwise identified for
the purpose of subjecting the same to the payment of Indebtedness or performance
of any other obligation in priority to the payment of the general, unsecured
creditors of such Person; and (c) the filing of, or any agreement to give, any
financing statement under the Uniform Commercial Code or its equivalent in any
jurisdiction.
"Material Adverse Effect," with respect to the Company, means (i) a
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material adverse effect on the business, operations, properties, prospects,
profits or condition (financial or otherwise) of the Company and its
Subsidiaries, taken as a whole, (ii) the incurrence of liabilities or
obligations of the Company and its Subsidiaries (other than current liabilities
incurred in the ordinary course of business and Indebtedness incurred in
accordance with the provisions of this Reimbursement Agreement), (iii) an
impairment of the ability of the Company to perform its obligations under this
Reimbursement Agreement or (iv) an impairment of the ability of the Bank to
enforce such obligations.
"Money Borrowed" means, as applied to the Indebtedness of a Person: (a)
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Indebtedness for money borrowed; (b) Indebtedness, whether or not in any such
case the same was for money borrowed, but other than trade debt of such Person
incurred in the ordinary course of business (i) represented by notes payable,
and drafts accepted, that represent extensions of credit, (ii) constituting
obligations evidenced by bonds, debentures, notes or similar instruments, or
(iii) upon which interest charges are customarily paid or that was issued or
assumed as full or partial payment for property; or (c) Indebtedness that
constitutes a Capitalized Lease Obligation.
"Multiemployer Plan" has the meaning given that term in Section
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4001(a)(3) of ERISA, as amended or revised from time to time.
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"Obligations" means and includes, with respect to the Company, all
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loans, advances, debts, liabilities, and obligations, howsoever arising, owed by
the Company to the Bank in any capacity of every kind and description (whether
or not evidenced by any note or instrument and whether or not for the payment of
money), direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising pursuant to the terms of this Reimbursement
Agreement or any of the Related Documents, including without limitation, (a) any
obligation of the Company to repay the Bank for any drawing under the Letter of
Credit and (b) all interest, fees, charges, expenses, attorneys' fees and
accountants' fees chargeable to the Company in connection with its dealings with
the Bank and payable by the Company hereunder or thereunder.
"Official Statement" means that certain Official Statement, dated
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November 12, 1997, relating to the Bonds.
"PBGC" means the Pension Benefit Guaranty Corporation and any successor
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agency.
"Permitted Liens" means, as to any Person or such Person's property:
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(a) inchoate Liens securing taxes, assessments and other charges or levies
imposed by any Governmental Authority (excluding any Lien imposed pursuant to
any of the provisions of ERISA) or the claims of materialmen, mechanics,
carriers, warehousemen or landlords for labor, materials, supplies or rentals
incurred in the ordinary course of business; (b) Liens consisting of deposits or
pledges made, in the ordinary course of business, in connection with, or to
secure payment of, obligations under workmen's compensation, unemployment
insurance or similar Applicable Laws; (c) Liens consisting of encumbrances in
the nature of zoning restrictions, easements, and rights or restrictions of
record on the use of real property, which do not materially detract from the
value of such property or impair the use thereof in the business of such Person;
and (d) Liens in favor of the Bank.
"Person" means an individual, corporation, partnership, association,
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trust or unincorporated organization, or a government or any agency or political
subdivision thereof.
"Personal Property" means, generally, the equipment to be purchased
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with the proceeds of the Bonds, as more fully described in the Deed to Secure
Debt.
"Plan" means an "employee pension benefit plan" (as defined in Section
---- ------------------------------
3 of ERISA) which is or has been established or maintained, or to which
contributions are or have been made, by the Company or by any trade or business,
whether or not incorporated, which, together with the Company, is under common
control, as described in Section 414(b) or (c) of the Code.
"Plans and Specifications" has the meaning given that term in Section
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3.1(r) of this Reimbursement Agreement.
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"Pledge Agreement" means the Pledge Agreement, dated as of November 1,
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1997, by and among the Company, the Trustee and the Bank, substantially in the
form of Exhibit B attached to this Reimbursement Agreement.
"Preliminary Official Statement" means that certain Preliminary
---------------------------------
Official Statement, dated October 27, 1997 relating to the Bonds.
"Prime Rate" means the rate of interest publicly announced by
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NationsBank, N.A. in Atlanta, Georgia, from time to time as its "prime rate."
"Project" has the meaning given that term in the Agreement.
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"Project Site" has the meaning given that term in the Deed to Secure
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Debt.
"Reimbursement Agreement" means this Letter of Credit and
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Reimbursement Agreement.
"Related Documents" means the Letter of Credit, the Bonds, the
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Indenture, the Agreement, the Deed to Secure Debt, the Remarketing Agreement,
the Pledge Agreement, the Note and any other agreement or instrument executed
and delivered in connection with any of the foregoing.
"Remarketing Agent" has the meaning given that term in the Indenture.
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"Remarketing Agreement" has the meaning given that term in the
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Indenture.
"Reportable Event" has the meaning given that term in Section 4043(b)
-----------------
of ERISA, but shall not include a Reportable Event to which the provision for 30
days' notice to the PBGC is waived under applicable regulations.
"Responsible Officer" means the President or any Vice President of the
--------------------
Company or, with respect to financial matters, the Chief Financial Officer,
Treasurer or Controller of the Company.
"Stated Expiration Date" means the date set forth as such on the first
-----------------------
page of the Letter of Credit and any such later date to which it may be extended
in accordance with Section 2.11.
"Sublease" means the Sublease, dated as of October 1, 1997 between the
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Company and ▇▇▇▇▇▇ Fixture Corporation.
"Subsidiary" means, when used to determine the relationship of a Person
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to another Person, a Person of which an aggregate of 50% or more of the stock of
any class or classes or 50% or more of other ownership interests is owned of
record or beneficially by such other Person, or by one or more Subsidiaries of
such other Person, or by such other Person and one or more Subsidiaries of such
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Person, (i) if the holders of such stock, or other ownership interests, (A) are
ordinarily, in the absence of contingencies, entitled to vote for the election
of a majority of the directors (or individuals performing similar functions) of
such Person, even though the right so to vote has been suspended by the
happening of such contingency or (B) are entitled, as such holders, to vote for
the election of a majority of directors (or individuals performing similar
functions) of such Person, whether or not the right to so vote exists by reason
of the happening of a contingency, or (ii) in the case of such other ownership
interests, if such ownership interests constitute a majority voting interest.
"Termination Event" means (a) a Reportable Event; (b) the filing of a
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notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA or (c) the institution of proceedings to
terminate a Plan by the PBGC under Section 4042 of ERISA, or the appointment of
a trustee to administer any Plan.
"Trust Estate" has the meaning given that term in the Indenture.
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"Trustee" has the meaning given that term in the Indenture.
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"Underwriter" means Merchant Capital, L.L.C., as Underwriter.
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"Unfunded Vested Accrued Benefits" means with respect to any Plan at
----------------------------------
any time, the amount (if any) by which (a) the present value of all vested
nonforfeitable benefits under such Plan exceeds (b) the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan.
"Uniform Commercial Code" or "UCC" means the Uniform Commercial Code as
----------------------- ---
in effect from time to time in the State of Georgia.
Section 1.2. General.
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Unless otherwise indicated, all accounting terms, ratios and
measurements shall be interpreted or determined in accordance with generally
accepted accounting principles. All terms defined in the UCC and not otherwise
defined herein are used herein as defined in the UCC. References in this
Reimbursement Agreement to "Sections," "Articles," "Exhibits" and "Schedules"
are to sections, articles, exhibits and schedules herein and hereto unless
otherwise indicated. references in this Reimbursement Agreement to any document,
instrument or agreement (a) shall include all exhibits, schedules and other
attachments thereto, (b) shall include all documents, instruments or agreements
issued or executed in replacement thereof, and (c) shall mean such document,
instrument or agreement, or replacement or predecessor thereto, as amended,
modified or supplemented from time to time and in effect at any given time.
Wherever from the context it appears appropriate, each term stated in either the
singular or plural shall include the singular and plural, and pronouns stated in
the masculine, feminine or neuter gender shall include the masculine, the
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feminine and the neuter. Unless explicitly set forth to the contrary, a
reference to "Subsidiary" shall mean a Subsidiary of the Company or a Subsidiary
of such Subsidiary and a reference to an "Affiliate" shall mean a reference to
an Affiliate of the Company. Unless otherwise indicated, all references to time
are references to Atlanta, Georgia time.
ARTICLE 2. AMOUNT AND TERMS OF THE LETTER OF CREDIT
Section 2.1. Issuance of the Letter of Credit.
--------------------------------
Upon fulfillment of the applicable conditions set forth in Article 3,
and subject to the terms and conditions of this Reimbursement Agreement, the
Bank agrees to issue the Letter of Credit on November 12, 1997, for the account
of the Company, naming the Trustee as beneficiary and having an initial stated
amount of $11,162,739.72. Such stated amount shall reduce and be reinstated in
accordance with the terms of the Letter of Credit.
Section 2.2. Reimbursement Obligation.
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The Company hereby agrees to pay to the Bank on the date on which the
Bank shall pay any draft presented under the Letter of Credit (but only after
payment by the Bank under the Letter of Credit) a sum equal to the amount so
paid under the Letter of Credit; provided, however, in the event of a drawing
under the Letter of Credit to pay the Purchase Price (as defined in the
Indenture) of any Bonds tendered for purchase pursuant to Section 3.08 of the
Indenture, the Company agrees to pay to the Bank on or before the 30th day
following the date on which the Bank shall pay any such draft, a sum equal to
the amount so paid under the Letter of Credit, plus interest from the date
payment is so made by the Bank until payment in full, at a per annum rate equal
to the Prime Rate plus one percent (1.0%); provided, further, however, that no
interest shall be payable pursuant to the immediately preceding clause on any
amounts repaid by 10:00 a.m. on the Business Day immediately succeeding the day
on which any such drawing is honored.
Section 2.3. Letter of Credit Commission.
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The Company hereby agrees to pay to the Bank a letter of credit
commission with respect to the amount available to be drawn under the Letter of
Credit, in an amount equal to 0.55% per annum of the maximum amount available
under the Letter of Credit as of the Closing Date and on each November 15th
thereafter. Such letter of credit commission shall be payable on the Closing
Date and on November 15, 1998 and each November 15 thereafter. Upon any
extension of the Letter of Credit, the amount of the letter of credit commission
shall be determined by the Bank; provided, however, that the Letter of Credit
commission will not exceed 0.75% per annum of the maximum amount available under
the Letter of Credit.
Section 2.4 Payments and Computations.
-------------------------
-10-
(a) The Company shall make each payment hereunder not later than 12:00
noon on the day when due in lawful money of the United States of America to the
Bank at its address referred to in Section 9.1.(c) in immediately available
funds. The Company hereby authorizes the Bank, if and to the extent payment is
not made when due hereunder, to charge from time to time against any of the
Company's accounts with the Bank any amount so due. Computations of interest and
letter of credit commission hereunder shall be made by the Bank on the basis of
a year of 365 or 366 days, as the case may be, for the actual number of days
(including the first day but excluding the last day) elapsed. Whenever any
payment to be made hereunder shall be stated to be due on a day which is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
payment of interest or letter of credit commission, as the case may be. If any
amount required to be paid by the Company to the Bank under this Reimbursement
Agreement or any Related Document remains unpaid after such amount is due
(whether because of operation of law or otherwise), the Company shall pay
interest on such past due amount from the date due until such amount is paid in
full at the Default Rate. All such interest shall be due and payable on demand.
(b) On the first Business Day of each month, beginning November 1,
1998, the Company shall deliver monies equal to one-twelfth (1/12) of the
principal amount coming due on the next November 1st, to the Bank. In addition,
not later than the Business Day prior to each Interest Payment Date and each
Redemption Date, the Company shall deliver monies sufficient to pay the interest
due and payable on such Interest Payment Date or Redemption Date. In any event
and notwithstanding anything herein to the contrary, not later than the Business
Day prior to each Interest Payment Date and each Redemption Date, the Company
shall deliver monies sufficient to pay the principal and interest due and
payable on such Interest Payment Date or Redemption Date.
(c) Notwithstanding anything herein to the contrary, the Company shall
receive as a credit against its obligation to make the interest payments
described in this Section 2.4 all payments made by the Trustee from the
Construction Fund to reimburse the Bank for interest drawings under the Letter
of Credit.
(d) All monies delivered to the Bank pursuant to Section 2.4(c) above
shall be deposited in the sinking fund account described in Section 3.2(a) of
this Agreement, and shall be used by the Bank to reimburse the Bank for draws
under the Letter of Credit. While in such account, such monies shall be invested
in such short-term investments as may be directed by the Company with the
consent of the Bank (but in any event so that the monies will be available on
the payment dates for which reimbursement will be required), and all earnings on
such monies shall be deposited in the sinking fund account and used to reimburse
the Bank for draws under the Letter of Credit.
-11-
Section 2.5 Obligations Absolute.
--------------------
The obligations of the Company under Section 2.2. of this Reimbursement
Agreement shall be absolute, unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Reimbursement Agreement under all
circumstances whatsoever, including, without limitation, the following
circumstances: (a) any lack of validity or enforceability of any Related
Document or any term or provisions therein; (b) any amendment or waiver of or
any consent to departure from all or any of the Related Documents; (c) the
existence of any claim, setoff, defense or other right which the Company may
have at any time against the Trustee, any other beneficiary or any transferee of
the Letter of Credit (or any Persons for whom the Trustee, any such beneficiary
or any such transferee may be acting), the Bank or any other Person, whether in
connection with this Reimbursement Agreement, the transactions contemplated
herein or in the Related Documents or any unrelated transaction; (d) any breach
of contract or dispute between the Company, the Trustee, the Issuer, the Bank,
the Remarketing Agent or any other Person; (e) any demand, statement or any
other document presented under the Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein or
made in connection therewith being untrue or inaccurate in any respect
whatsoever; (f) any non-application or misapplication by the Trustee or
otherwise of the proceeds of any drawing under the Letter of Credit; (g) payment
by the Bank under the Letter of Credit in good faith against presentation of a
draft or certificate which does not strictly comply with the terms of the Letter
of Credit; and (h) any other act, omission to act, delay or circumstance
whatsoever that might, but for the provisions of this Section, constitute a
legal or equitable defense to or discharge of the Company's obligations
hereunder. Nothing in this Section shall abrogate any right which the Company
may have to recover damages from the Bank under Section 2.6.
Section 2.6 Commercial Practices.
--------------------
The Company agrees that neither the Bank nor any of its directors,
officers, employees or agents 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 or any other beneficiary or transferee in connection therewith; (b) any
reference which may be made to this Reimbursement Agreement or to the Letter of
Credit in any agreements, instruments or other documents relating to the Bonds;
(c) the validity, sufficiency or genuineness of documents other than the Letter
of Credit, or of any endorsement thereon, even if such documents should in fact
prove to be in any or all respects invalid, insufficient, fraudulent or forged
or any statement therein proves to be untrue or inaccurate in any respect
whatsoever; (d) payment by the Bank against presentation of documents which do
not comply with the terms of the Letter of Credit, including failure of any
documents to bear any reference or adequate reference to the Letter of Credit;
or (e) any other circumstances whatsoever in making or failing to make payment
under the Letter of Credit, except only that the Bank shall be liable to the
Company for acts or events described in clauses (a) through (e) above, to the
extent, but only to the extent, of any direct, as opposed to consequential,
damages suffered by the Company which the Company proves were caused by (i) the
Bank's willful misconduct or gross negligence in determining whether a drawing
made under the Letter of Credit complies with the terms and conditions therefor
-13-
stated in the Letter of Credit or (ii) the Bank's willful failure to pay under
the Letter of Credit after presentation of a drawing by the beneficiary thereof
strictly complying with the terms and conditions of the Letter of Credit. The
Company understands and agrees that the Bank may accept a drawing that appears
on its face to be in order, without responsibility for further investigation.
The determination of whether a drawing has been made under the Letter of Credit
prior to its expiration or whether a drawing made under the Letter of Credit is
in proper and sufficient form shall be made by the Bank in its sole discretion,
which determination shall be conclusive and binding upon the Company. The
Company hereby waives any right to object to any payment made under the Letter
of Credit with regard to a drawing that is in the form provided in the Letter of
Credit but which varies with respect to punctuation, capitalization, spelling or
similar matters of form.
Section 2.7 Increased Costs.
---------------
If any change in any law or regulation or in the interpretation thereof
by any court or administrative or governmental authority charged with the
administration thereof or any compliance by the Bank with any new guideline or
request from any central bank or administrative or governmental authority
(whether or not having the force of law) shall either (a) affect, impose, modify
or deem applicable any reserve, special deposit, capital maintenance or similar
requirement against letters of credit (or similar contingent obligations) issued
by, or amount of capital required or expected to be maintained by, or assets
held by, or deposits in or for the account of, the Bank or any corporation
controlling the Bank or (b) impose on the Bank or any corporation controlling
the Bank any other condition regarding this Reimbursement Agreement or the
Letter of Credit, and the result of any event referred to in the preceding
clause (a) or (b) shall be to increase the cost to the Bank or any corporation
controlling the Bank of issuing or maintaining the Letter of Credit (which
increase in cost shall be determined by the Bank's reasonable allocation of the
aggregate of such cost increases resulting from any such event), then, upon
demand by the Bank, the Company shall immediately pay to the Bank, from time to
time as specified by the Bank, additional amounts which shall be sufficient to
compensate the Bank or any corporation controlling the Bank for such increased
cost. A certificate as to such increased cost incurred by the Bank as a result
of any event mentioned in clause (a) or (b) above, submitted by the Bank to the
Company, shall, in the absence of manifest error, be conclusive and binding for
all purposes.
Section 2.8 Payments Net of Taxes, Etc.
---------------------------
All payments to the Bank under this Reimbursement Agreement and the
Related Documents shall be made free and clear of and without deduction, setoff
or counterclaim of any kind whatsoever and in such amounts as may be necessary
in order for all such payments, after deduction or withholding for or on account
of any present or future taxes, levies, imposts, deductions, duties or other
charges or withholdings of whatsoever nature imposed by any Person, except in
the case of the Bank, any tax (or portion thereof) imposed on, or measured by,
the net income of the Bank pursuant to Applicable Laws (such taxes, levies,
imposts, deductions, duties or other charges or withholdings are referred to
-13-
hereinafter, collectively, as the "Taxes"), to be not less than the amounts
otherwise specified to be paid under this Reimbursement Agreement and the
Related Documents. The Company shall indemnify the Bank against liability for
all Taxes as and when due and shall promptly (and in any event not later than
thirty days after payment thereof) furnish to the Bank as the case may be, such
certificates, receipts and other documents as may be required (in the judgment
of the Bank) to establish the payment of such Taxes and any tax credit to which
the Bank may be entitled. The Company agrees to pay any present or future stamp,
recording or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from the execution
or delivery or otherwise with respect to, this Reimbursement Agreement. The
obligations of the Company under this Section shall survive the termination of
this Reimbursement Agreement and the repayment of the Obligations.
SECTION 2.9 AGREEMENT REGARDING INTEREST AND CHARGES.
----------------------------------------
ALL CHARGES IMPOSED BY THE BANK ON THE COMPANY IN CONNECTION WITH THIS
REIMBURSEMENT AGREEMENT, INCLUDING ALL LETTER OF CREDIT COMMISSIONS, DEFAULT
CHARGES, LATE CHARGES, ATTORNEYS' FEES AND REIMBURSEMENT FOR COSTS AND EXPENSES
PAID BY THE BANK TO THIRD PARTIES OR FOR DAMAGES INCURRED BY THE BANK, ARE
CHARGES MADE TO COMPENSATE THE BANK FOR ADMINISTRATIVE SERVICES AND COSTS OR
LOSSES PERFORMED OR INCURRED, AND TO BE PERFORMED OR INCURRED, BY THE BANK IN
CONNECTION WITH THIS REIMBURSEMENT AGREEMENT AND THE RELATED DOCUMENTS AND SHALL
UNDER NO CIRCUMSTANCES BE DEEMED TO BE CHARGES FOR THE USE OF MONEY PURSUANT TO
OFFICIAL CODE OF GEORGIA ANNOTATED SECTIONS 7-4-2 OR 7-4-18. ALL CHARGES SHALL
BE FULLY EARNED AND NONREFUNDABLE WHEN DUE. In no event shall the amount of any
interest payable hereunder exceed the maximum rate of interest allowed by
Applicable Law. It is the express intent of the parties hereto that the Company
not pay and the Bank not receive, directly or indirectly, in any manner
whatsoever, interest in excess of that which may be lawfully paid by the
Borrower under Applicable Law.
Section 2.10 Evidence of Obligations.
-----------------------
The Bank may maintain in accordance with its usual practice a record of
account evidencing the indebtedness of the Company resulting from each drawing
under the Letter of Credit. In any legal action or proceeding in respect of this
Reimbursement Agreement, the entries made in such record shall be conclusive
evidence, absent manifest error, of the existence and amounts of the obligations
of the Company therein recorded. Failure of the Bank to maintain any such record
shall not excuse the Company from any of its obligations under this
Reimbursement Agreement or any of the Related Documents.
-14-
Section 2.11 Extension of Stated Expiration Date.
-----------------------------------
The Company may request the Bank to extend the Stated Expiration Date
of the Letter of Credit for successive five-year periods. On or before November
15, 2000, the Company shall request such an extension by executing and
delivering to the Bank a written request in the form of Exhibit C attached
hereto (an "Extension") executed by the Company. On or before November 15, 2005
and on or before November 15, 2010, provided the Bank has previously extended
the stated Expiration Date, the Company shall request an extension in each
instance by executing and delivering to the Bank an Extension executed by the
Company. Upon receipt of an Extension, the Bank shall then determine whether or
not there is an Event of Default as defined herein or in any of the Related
Documents. If an Event of Default exists under Section 8.1(a), (f) or (g) of
this Reimbursement Agreement, or a payment default exists under any Related
Document, the Bank shall not be obligated to extend the Stated Expiration Date
of the Letter of Credit. If any other Event of Default exists under the
Reimbursement Agreement or any Related Document, the Bank shall provide written
notice to the Company of such Event of Default and the Company shall have a
period of thirty (30) days after receipt of said notice to cure such Event of
Default. If there is no Event of Default or if such Event of Default is cured
within such thirty (30) day period, the Bank shall extend the Stated Expiration
Date by five (5) years by delivering to the Trustee, on or before December 31,
2000 and on or before December 31, 2005 and December 31, 2010, as applicable, an
Extension Certificate in the form of Annex F to the Letter of Credit. If there
is an Event of Default that is not cured as provided in this Section 2.11, then
the Bank will not be obligated to extend the Letter of Credit and the Bank shall
not deliver an Extension Certificate in accordance with this Section 2.11. Such
failure shall be deemed to be a denial of the Company's extension request.
Section 2.12 Alternate Letter of Credit.
--------------------------
The Company may cause the Letter of Credit to be terminated by
providing an Alternate Letter of Credit to the Trustee in accordance with the
terms of the Indenture.
Section 2.13. Remarketing.
-----------
Bonds purchased by the Remarketing Agent pursuant to a tender
drawing to pay the purchase price of Bonds tendered for purchase upon failed
remarketing shall be owned by the Bank and delivered to the Trustee and
registered in the Bank's name or in the name of its nominee, pursuant to the
Pledge Agreement. Such delivery and registration shall constitute a purchase by
the Bank of the Bonds ("Bank Bonds"). Interest on the Bank Bonds shall be paid
to the Bank from the date of the tender drawing until paid in full or remarketed
in accordance with the provisions of the Indenture at the rate referred to as
the Alternate Weekly Index, and such interest shall be payable on the first
business day of each month; provided that on any overdue installment of
principal, the Company shall pay interest on Demand, at the default rate. (The
default rate shall be a per annum rate of interest equal to the Prime Rate plus
2% per annum.) If the Bank Bonds have not been remarketed on the 10th day
-15-
following the tender date, the Company agrees to make principal payments to the
Bank in accordance with the remaining portion of the twenty (20) year principal
amortization schedule attached hereto as Exhibit F.
ARTICLE 3. CONDITIONS OF ISSUANCE
Section 3.1. Condition Precedent to Issuance of the Letter of Credit.
The obligation of the Bank to issue the Letter of Credit is subject to
the condition precedent that the Bank shall have received on or before the
Closing Date the following, each dated or dated as of such day and each in form
and substance satisfactory to the Bank:
(a) This Reimbursement Agreement, duly executed by the Company.
(b) The Bond Purchase Agreement, duly executed by the Underwriter, the
Company and the Issuer.
(c) The Remarketing Agreement, duly executed by the Remarketing Agent,
the Company and the Issuer.
(d) The Pledge Agreement, duly executed by the Company, the Trustee and
the Bank.
(e) The Deed to Secure Debt, duly executed by the Company and the
Issuer.
(f) The Affiliate Guaranties, duly executed by the respective Affiliate
Guarantors.
(g) The Financing Statements, duly executed by the Company.
(h) A Title Insurance Commitment (the "Title Commitment") on the
American Land Title Association's standard loan policy form, written by
Commonwealth Land Title Insurance Company (the "Title Insurance Company"),
insuring the Bank in an amount not less than the appraised value of the Land and
Improvements as reviewed and approved by the Bank's in-house appraisal
department. The Title Commitment shall commit to insure the security deed(s)
conveying any real estate collateral required hereunder to be a valid first in
priority security title subject only to such exceptions and conditions of title
as the Bank sees fit to approve, in its sole discretion. The title insurance
policy (the "Title Policy"), when issued, shall not contain any exception for
matters of survey, mechanic's or materialmen's liens or taxes and assessments
which are due and payable, and shall contain an endorsement which shall provide
for increasing coverage under the Title Policy upon subsequent disbursements of
the Bond proceeds in good faith and without knowledge of title defects and any
other endorsements required by the Bank.
-16-
Copies of any instruments creating any lien or encumbrance excepted
from the coverage outlined in the Title Commitment shall be attached to the
Title Commitment. A tax report or other evidence of payment of all taxes and
assessments on the Land shall be attached to the Title Commitment.
Prior to the advance of any Bond proceeds, the Bank must receive an
endorsement to the Title Policy insuring any and all modifications of security
deeds as of the date recorded, subject to no intervening liens or interests.
(i) Approval by the Bank of the general contractor responsible for
constructing the Project. The Bank hereby approves ▇▇▇▇▇▇ Construction, Inc. as
the general contractor.
(j) A fully executed construction contract for the construction of the
Improvements, which contract shall be satisfactory to the Bank in all respects.
The Bank may appoint, at the Company's sole cost and expense, an inspecting
consultant who shall review the construction contract and all other materials
related thereto, and who shall continue to serve as inspecting architect
throughout the construction of the Improvements.
(k) Consents to the assignment of construction documents, including
consents by the construction contractor, architect and all other parties to
contracts and documents concerning or affecting the Land and Improvements,
including undertakings of the general contractor and architect to continue
performance on the Bank's behalf without additional cost in the event of default
by the Company.
(l) A development cost breakdown and construction and non-construction
costs breakdowns on the Bank's forms (or upon AIA Standard Document No. G 703)
showing details of all construction and non-construction costs including a
specification of which items are to be funded from sources other than Bond
proceeds.
(m) An owner's affidavit with respect to the Project Site, such
affidavit to be in form sufficient to remove from the foregoing Policy of Title
Insurance the "standard exceptions."
(n) Two (2) sealed copies of a current survey of the proposed Project,
including all adjoining alleys and appurtenant easements, prepared and certified
by a duly registered land surveyor of the State of Georgia. Said survey, which
shall be subject to the approval of the Bank and Bank's counsel, shall be
prepared in accordance with the Bank's standard survey instructions. The survey
shall contain a satisfactory Surveyor's Certificate and shall be accompanied by
a standard Surveyor's Inspection Report as may be required by the title insurer
so as to allow the deletion of the standard survey exceptions from the Bank's
title insurance policy. During the course of construction, the Company shall be
required to furnish to the Bank such additional surveys as it may from time to
time require, including one or more "foundation surveys" prior to the first
disbursement of Bond proceeds, and upon completion of construction of the
Project, the Borrower shall furnish a final "as-built" survey showing all
-17-
improvements on the Project, and all appurtenances thereto as actually
constructed, as well as such other information as may be required by the Bank.
All surveys shall be certified to "NationsBank of Georgia, National
Association," the Company and the title insurance company insuring the interest
of the Bank's security instrument, and shall also be certified to comply with
the minimum technical standards for surveys established by the State of Georgia.
In addition, the survey must show whether or not the Project, and specifically
any building improvements are located in a U.S. Department of Housing and Urban
Development ("H.U.D.") identified "Special Flood Hazard Area" or "Floodway
Area." The survey must identify the specific flood zone in which the Project,
and/or the improvements are located, the finished ground floor elevations of the
improvements, and the base flood elevation. Flood Hazard Certification must
comply with the National Flood Insurance Act of 1968, the Flood Disaster
Protection Act of 1973, and the Housing and Community Development Acts of 1974
and 1977, all as amended, as applicable.
(o) A letter from the appropriate governmental zoning authority
indicating that the Land is zoned to allow the use contemplated by the Company
and by a site plan and plans and specifications (the "Plans and Specifications")
and attaching copies of any restrictions, conditions and variances applicable to
the Land.
(p) If, on or prior to the date of the issuance of the Letter of
Credit, any contractors, subcontractors, materials suppliers or others have
worked on the Land or delivered materials to the Land, the Company shall secure
their execution of any affidavits and lien waivers which may be required by the
Bank's counsel or the Title Insurance Company in order to comply with the title
insurance provisions hereof.
(q) A UCC-1, tax, judgment and lien search report conducted on the
Company and any other owner or holder of collateral hereunder (and under any
other names by which such entity or individual has been known in the last 5
years) in the counties in which such entities have operated (or such individual
has resided) during the last 5 years.
(r) If any secured note or other loan or lien is to be paid from the
Bond proceeds, the Company shall present to the Bank a pay-off letter from each
individual or entity holding a lien on the Land. The letter shall be signed by
the holder of the lien and shall indicate:
(i) the amount required to satisfy and release the lien as of
the proposed date of closing (the unpaid balance, including interest, accrued to
the proposed date of closing),
(ii) the "per diem" or the amount of interest accruing daily
--------
upon the unpaid balance for each day following the date of the proposed closing
of the loan; and
-18-
(iii) an affirmation that upon receipt of such amount, the
holder of the lien shall consider the lien satisfied and shall release the lien
by the execution of any and all appropriate instruments.
(s) Current and present originals or certified copies of all Project
soil test reports containing the findings and recommendations of a registered
soils engineer. Such report must be acceptable in scope and content to the Bank.
(t) An environmental assessment of the Project prepared for the Bank by
an environmental consultant engaged by the Bank, at the expense of the Company,
which assessment shall be in form and content satisfactory to the Bank in its
absolute and sole discretion. This report will be used by the Bank but will not
be deemed to be conclusive. The Bank shall have no obligation to issue the
Letter of Credit if the Project or any adjacent property contains any
environmentally hazardous substances, underground or above ground storage tanks,
or other environmental conditions deemed by the Bank, in the exercise of its
absolute and sole discretion, to be unsafe or constitute an undue risk to the
Bank.
(u) Evidence satisfactory to the Bank that the Company has obtained all
permits, licenses and other authorizations which are then required under all
Environmental Laws relating to the Project, and that the Company is in
compliance in all material respects with all such Environmental Laws.
(v) An As-Built Appraisal of the Project, ordered at the expense of the
Company, which shall be satisfactory in all respects to the Bank (and reviewed
and approved by the Bank's in-house appraisal department).
(w) Good Standing certificates with respect to each of the Company and
the Affiliate Guarantors issued by the Secretary of State of the State of
Georgia.
(x) A certificate of the Member of the Company, dated the Closing Date,
certifying among other things: (i) that the articles of organization and the
operating agreement of the Company, in the form attached thereto, are in full
force and effect and have not been amended, supplemented, revoked or repealed
since the date of such certification; (ii) that attached thereto are true and
correct copies of resolutions duly adopted by the sole member of the Company and
continuing in effect, which authorize the execution, delivery and performance by
the Company of this Reimbursement Agreement and the Related Documents to which
the Company is a party; (iii) that the Company is in good standing with all
licenses, income and franchise taxes paid; (iv) that there are no proceedings
for dissolution or liquidation of the Company (commenced or threatened); and (v)
the incumbency, signatures and authority of the officers of the Company
authorized to execute and deliver this Reimbursement Agreement and the Related
Documents to which the Company is a party.
-19-
(y) A certificate of the Secretary or an Assistant Secretary of each
Affiliate Guarantor, dated the Closing Date, certifying among other things: (i)
that the articles of incorporation and bylaws of the Affiliated Guarantors, in
the form attached thereto, are in full force and effect and have not been
amended, supplemented, revoked or repealed since the date of such certification;
(ii) that attached thereto are true and correct copies of resolutions duly
adopted by the Board of Directors of the Affiliated Guarantors and continuing in
effect, which authorize the execution, delivery and performance by the
Affiliated Guarantors; (iii) that the Affiliated Guarantors are in good standing
with all licenses, income and franchise taxes paid; (iv) that there are no
proceedings for dissolution or liquidation of the Affiliated Guarantors
(commenced or threatened); and (v) the incumbency, signatures and authority of
the officers of the Affiliated Guarantors authorized to execute and deliver the
Affiliated Guarantees and the Related Documents to which the Affiliate Guarantor
is a party.
(z) A certificate of a Responsible Officer of the Company, dated the
Closing Date, certifying that:
(i) The representations and warranties set forth in this
Reimbursement Agreement and the Related Documents to which the Company
is a party are true and correct as of such date;
(ii) No Event of Default or Default has occurred and is
continuing as of such date; and
(iii) No material adverse change in the financial condition or
business affairs of the Company and the Affiliate Guarantors has
occurred since August 31, 1997.
(aa) Certified copies of all governmental approvals (including
approvals or orders of the Issuer) necessary with respect to this Reimbursement
Agreement and the transactions contemplated hereby.
(bb) Original, signed copies of the financial statements of the Company
and original, signed copies of the financial statements of each Guarantor as
requested by the Bank, together with the unqualified opinion of the accountants
preparing such statements regarding such financial statements and any current
credit reports and other financial data required in order to evidence no
significant financial deterioration from the date of any initial financial
statements, as and when requested by the Bank.
(cc) A certificate of public liability insurance from an insurance
company acceptable to the Bank and containing minimum limits of public liability
coverage of $1,000,000.00, one person, with respect to one incident, and with
respect to property damage. The Borrower shall also present a certificate of
worker's compensation insurance, if required by the Bank at any time during the
term of the Letter of Credit.
-20-
The certificate required under the immediately preceding paragraph
shall contain an endorsement clause showing the Bank as an additional insured or
loss payee, as appropriate, and shall list the address of the Bank as shown
above.
All policies must be issued by insurance companies and agencies
licensed by the Insurance Commissioner of the State of Georgia.
The Bank shall have the right to approve each and every insurance
carrier and policy. all policies shall be in the amounts, form and content
(including mortgagee clauses) and issued by such companies as are acceptable to
the Bank. Each insurance company must have a rating of A- or better (Excellent
or Superior), and Class IX or better, in A.M. Best's Insurance Reports.
All policies must contain provisions obligating the insurance
carrier(s) to provide the Bank at least thirty (30) days' advance written notice
of the expiration, termination or cancellation of any such policy or policies.
Policy premiums for all coverages (including personal property if given
as security) must be current and the Bank may require paid receipts or other
evidence as proof of payment.
Except for liability insurance, the above-referenced insurance policies
shall contain a standard mortgagee clause naming "NATIONSBANK, N.A., ITS
SUCCESSORS AND/OR ASSIGNS" as first mortgagee, which states that the insurance
coverage shall not be affected by any act or neglect of the Borrower or owner of
the improvements.
The applicable policies must be maintained during the term of the
Letter of Credit. All annual policy renewals must be forwarded to NationsBank,
N.A., at the address first above written or such other address as designated by
the Bank from time to time.
The Bank reserves the right to require the escrow of insurance premiums
during the term of the Letter of Credit.
(dd) The Company shall present evidence satisfactory to the Bank that
the Land has direct access to public roads by curb cuts adequate for the use
contemplated in the Plans and Specifications (or other access satisfactory to
the Bank), and that storm and sanitary sewer facilities, gas, water, electric
and telephone services adequate for the use contemplated in the Plans and
Specifications are available on or at the boundary of the Land. If sanitary
services are to be provided through the use of a septic tank, the Borrower shall
present to the Bank for its approval the results of a percolation test.
(ee) An executed copy of each of the Indenture and the Agreement
and specimens of the Bonds.
-21-
(ff) A certificate from the Issuer stating that the Issuer has duly
executed and delivered the Bonds to the Trustee.
(gg) An opinion of Hunton & ▇▇▇▇▇▇▇▇, Atlanta, Georgia, Bond Counsel,
in form and substance satisfactory to the Bank, which shall include advice from
such Bond Counsel to the Bank that the Bank may rely on such opinion.
(hh) An opinion letter from Holt, Ney, Zatcoff & ▇▇▇▇▇▇▇▇▇, LLP,
Atlanta, Georgia, counsel to the Company, dated the Closing Date and
substantially in the form of Exhibit D attached to this Reimbursement Agreement.
(ii) An opinion letter from Holt, Ney, Zatcoff & ▇▇▇▇▇▇▇▇▇, LLP,
counsel to each of the Affiliate Guarantors, dated the Closing Date, in form and
substance satisfactory to the Bank.
(jj) Payment of all fees due and payable on the Closing Date under the
terms of any of the Related documents.
Section 3.2. Additional Conditions Precedent to Issuance of the Letter
---------------------------------------------------------
of Credit.
---------
The obligation of the Bank to issue the Letter of Credit shall be
subject to the further condition precedent that on the date of the issuance of
the Letter of Credit:
(a) Simultaneously with the issuance of the Letter of Credit, as
security for the Bonds, the Company shall create and maintain an
interest-bearing sinking fund account with the Bank, controlled exclusively by
the Bank, and the Company hereby grants the Bank a first priority security
interest in and a collateral assignment of the amounts on deposit in such
account. The Company hereby covenants and agrees to take any and all actions
necessary to cause the Bank to have a perfected first priority security interest
in and a collateral assignment of the amounts on deposit in such account.
(b) No change or prospective change in Applicable Law, or any
interpretation thereof by any court or administrative, banking or governmental
authority charged or claiming to be charged with the administration thereof
applicable to the Bank or the Bonds, has occurred which, in the opinion of the
Bank, would have any effect described in Section 2.7. or would increase the risk
to the Bank with respect to payments under this Reimbursement Agreement or the
security therefor; and
(c) The Bank shall have received such other approvals, opinions or
documents as the Bank may reasonably request.
Section 3.3. Covenant to Deliver.
-------------------
The Company agrees (not as a condition but as a covenant) to deliver to
the Bank each item required to be delivered to the Bank as a condition to the
issuance of the Letter of Credit notwithstanding the fact that the Bank may
issue the Letter of Credit. The Company expressly agrees that the issuance of
-22-
the Letter of Credit prior to the receipt by the Bank of any such item shall not
constitute a waiver of the Company's obligation to deliver such item.
Section 3.4. Conditions Precedent to Approval of Requisitions and
-------------------------------------------------------
Related Matters.
---------------
The Bank's approval of requisitions for the disbursement of moneys from
the Construction Fund as provided in the Indenture and the Agreement is subject
to the further conditions that:
(a) The Bank shall have received the following, each dated or dated as
of such day and each in form and substance satisfactory to the Bank:
(i) A certificate from the project architect, if any, in the
form required by the Bank;
(ii) The Plans and Specifications for the construction of the
Improvements to be constructed upon the Land, which must be approved by
both the Bank and its inspecting agent, if any. Any modifications to
these items effected after such submission to the Bank (with the
exception of any change order in a maximum amount of $50,000 that will
not diminish the value of the Project, unless the Company has reached a
cumulative amount of change orders in the amount of $250,000) shall be
subject to the written approval of the Bank or its inspecting agent, if
any.
(iii) A building permit covering all of the Improvements
contemplated by the Plans and Specifications, issued by the appropriate
governmental authority and, upon completion of construction of the
Project, a certificate of occupancy and any other license or permits
which may be required.
(iv) A duplicate original Builder's Risk, All Risk Completed
Value Insurance Policy (the "Builder's Risk Policy"), in an amount
equal to 100% of the replacement cost of the Improvements but in no
event less than the amount of the Construction Contract, including, but
not limited to, coverage for damage by fire, extended coverages,
vandalism and malicious mischief, issued by an insurance company
acceptable to the Bank. "Reporting Form" insurance is not acceptable to
the Bank. The Builder's Risk Policy must provide for thirty (30) days'
notice of cancellation to the Bank and must contain a standard
mortgagee clause satisfactory to the Bank, in favor of the Bank in the
priority position of the Bank's security title, and showing the address
of the Bank as:
-23-
NationsBank, N.A.
Northwest Commercial Banking Center
Riverwood 100
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
The certificate required under the immediately preceding
paragraph shall contain an endorsement clause showing the Bank as an
additional insured or loss payee, as appropriate, and shall list the
address of the Bank as shown above.
All policies must be issued by insurance companies and
agencies licensed by the Insurance Commissioner of the State of
Georgia.
The Bank shall have the right to approve each and every
insurance carrier and policy. all policies shall be in the amounts,
form and content (including mortgagee clauses) and issued by such
companies as are acceptable to the Bank. Each insurance company must
have a rating of A- or better (Excellent or Superior), and Class IX or
better, in A.M. Best's Insurance Reports.
All policies must contain provisions obligating the insurance
carrier(s) to provide the Bank at least thirty (30) days' advance
written notice of the expiration, termination or cancellation of any
such policy or policies.
Policy premiums for all coverages (including personal property
if given as security) must be current and the Bank may require paid
receipts or other evidence as proof of payment.
Except for liability insurance, the above-referenced insurance
policies shall contain a standard mortgagee clause naming "NATIONSBANK,
N.A., ITS SUCCESSORS AND/OR ASSIGNS" as first mortgagee, which states
that the insurance coverage shall not be affected by any act or neglect
of the Borrower or owner of the improvements.
The applicable policies must be maintained during the term of
the Letter of Credit. All annual policy renewals must be forwarded to
NationsBank, N.A., at the address first above written or such other
address as designated by the Bank from time to time.
The Bank reserves the right to require the escrow of insurance
premiums during the term of the Letter of Credit.
-24-
(v) A schedule of values prepared and delivered by the
construction contractor.
(iv) A Certificate of an inspecting agent stating that the
work is being completed in substantial compliance with the Plans and
Specifications.
(b) Requisitions shall be submitted to the Bank in the form attached as
Exhibit B to the Agreement, signed by the Company. Each requisition shall be
accompanied by a statement showing the percentage of completion of the Project
and setting forth in detail the amounts expended or costs incurred for work done
and materials incorporated in the Project. All disbursements from the
Construction Fund shall be made in accordance with the Development Cost
Breakdown attached hereto as Exhibit E (the "Development Cost Breakdown"). If
requested by the Bank, each requisition shall be accompanied by a letter,
certificate of endorsement from the Title Insurance Company or an attorney
certifying title stating that a search of the public records has been made and
that such search reveals no claims which constitute a cloud on the Bank's
secured position established by the Deed, and that the amount of the
disbursement sought under the requisition will be covered by the Title Policy.
If an endorsement to the Title Policy is necessary for the amount of the
disbursement sought under the requisition to be covered, the endorsement shall
accompany the requisition.
(c) The Company shall not submit to the Bank for its approval more than
one requisition per calendar month. Each request for advance must be received by
the Bank at least five (5) Business Days prior to the date the disbursement
sought under the requisition is to be paid.
(d) Each submission of a requisition by the Company to the Bank shall
constitute an affirmation that the warranties and representations contained in
Article 4 of this Reimbursement Agreement remain true and correct and that no
breach of the covenants contained in Articles 5 and 7 of this Reimbursement
Agreement has occurred as of the date of submission of such requisition, unless
the Bank is notified and approves exceptions to the contrary prior to the
disbursement of the amount sought under such requisition.
(e) The amount of each advance shall be based on the percentage of
completion of work in place, as determined by the Bank on the basis of the
Company's requisition. No funds will be disbursed for materials stored on the
Premises, with the exception of steel, unless said materials are to be put in
place within forty-five (45) days. The Bank will at all times have final
determination of amounts to be disbursed.
(f) The Bank shall approve a requisition seeking disbursement of the
last 10% (or any greater percentage including the last 10%) of the proceeds of
the Bonds on deposit in the Construction Fund, but only on the date which is
seven (7) Business Days after the date on which the Bank has received the last
of the following items:
-25-
(i) A Certificate of an inspecting agent stating that the work has been
completed in substantial compliance with the Plans and Specifications;
(ii) Affidavits of the Company and the construction contractor, stating
that each person providing any material or performing any work in
connection with the Project has been paid in full;
(iii) An as-built survey showing all improvements, encroachments,
rights-of-way, easements and other matters of survey;
(iv) Any permits, licenses or other evidence of compliance with any
requirements of Governmental Authorities necessary for the use of the
Project as contemplated in the Plans and Specifications.
(v) A duplicate original Hazard Insurance Policy (the "Hazard Insurance
Policy"), in an amount equal to 100% of the replacement cost of the
Improvements but in no event less than the amount of the Construction
Contract, including, but not limited to, coverage for damage by fire,
extended coverages, vandalism and malicious mischief, issued by an
insurance company acceptable to the Bank. "Reporting Form" insurance is
not acceptable to the Bank. The Hazard Insurance Policy must provide
for thirty (30) days' notice of cancellation to the Bank and must
contain a standard mortgagee clause satisfactory to the Bank, in favor
of the Bank in the priority position of the Bank's security title, and
showing the address of the Bank as:
NationsBank, N.A.
Northwest Commercial Banking Center
Riverwood 100
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
The certificate required under the immediately preceding
paragraph shall contain an endorsement clause showing the Bank as an
additional insured or loss payee, as appropriate, and shall list the
address of the Bank as shown above.
All policies must be issued by insurance companies and
agencies licensed by the Insurance Commissioner of the State of
Georgia.
The Bank shall have the right to approve each and every
insurance carrier and policy. all policies shall be in the amounts,
form and content (including mortgagee clauses) and issued by such
companies as are acceptable to the Bank. Each insurance company must
have a rating of A- or better (Excellent or Superior), and Class IX or
-26-
better, in A.M. Best's Insurance Reports.
All policies must contain provisions obligating the insurance
carrier(s) to provide the Bank at least thirty (30) days' advance
written notice of the expiration, termination or cancellation of any
such policy or policies.
Policy premiums for all coverages (including personal property
if given as security) must be current and the Bank may require paid
receipts or other evidence as proof of payment.
Except for liability insurance, the above-referenced insurance
policies shall contain a standard mortgagee clause naming "NATIONSBANK,
N.A., ITS SUCCESSORS AND/OR ASSIGNS" as first mortgagee, which states
that the insurance coverage shall not be affected by any act or neglect
of the Borrower or owner of the improvements.
The applicable policies must be maintained during the term of
the Letter of Credit. All annual policy renewals must be forwarded to
NationsBank, N.A., at the address first above written or such other
address as designated by the Bank from time to time.
The Bank reserves the right to require the escrow of insurance
premiums during the term of the Letter of Credit.
(vi) Such other items as may be reasonably required by the Bank.
(g) By execution of this Reimbursement Agreement, the Company agrees
that: (i) the Bank is not acting as agent or trustee for the Company; (ii) the
Bank will not be held accountable for any requisition approved in good faith;
and (iii) all requisitions approved prior to receipt of written notice of
revocation shall be deemed approvals made in good faith.
(h) In its sole discretion, the Bank, at any time prior to granting its
approval of any requisition submitted to it by the Company, may require that the
Company obtain and deliver to the Bank written waivers or subordinations of
liens from the construction contractor or any other subcontractor.
(i) The Bank shall approve requisitions submitted by the Company up to
the aggregate amount of the direct costs specified in the Development Cost
Breakdown, for the purposes and in the amounts described therein, and not in
excess of the budgeted amount thereof, and the Bank shall approve requisitions
submitted by the Company for indirect costs up to the aggregate amount of the
indirect costs specified in the Development Cost Breakdown for the purposes and
-27-
in the amounts described therein and not in excess of the budgeted amount
thereof. The foregoing notwithstanding, the Bank agrees that should any aspect
of development of the Project be completed at a cost less than the amount
allocated to such item or category in the Development Cost Breakdown, the
surplus shall be available to fund overruns in other items or categories of
items provided, in the Bank's reasonable discretion, the remaining undisbursed
balance of the Construction Fund will be sufficient to complete construction of
the Improvements in accordance with the provisions of this Reimbursement
Agreement. The Bank further agrees that amounts in the contingency established
pursuant to the Development Cost Breakdown may be used to fund overruns.
ARTICLE 4. REPRESENTATIONS AND WARRANTIES.
Section 4.1. Representations and Warranties of the Company.
The Company represents and warrants to the Bank as follows:
(a) Organization; Power; Qualification. The Company is a limited
------------------------------------
liability company, duly organized, validly existing and in good standing under
the laws of its jurisdiction of the State of Georgia, has the power and
authority to own its properties and to carry on its business as now being and
hereafter proposed to be conducted and is duly qualified and authorized to do
business in the State of Georgia and in each jurisdiction in which (i) the
character of its properties or the nature of its business requires such
qualification or authorization and (ii) the absence of such qualification or
authorization would have a Material Adverse Effect.
(b) Subsidiaries. The Company has no subsidiaries.
------------
(c) Authorization. The Company has the right and power, and has taken
-------------
all necessary action to authorize it, to execute, deliver and perform this
Reimbursement Agreement and the Related Documents to which it is a party in
accordance with their respective terms. This Reimbursement Agreement and such
Related Documents have been duly executed and delivered by the duly authorized
officers of the Company and each is, a legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its respective
terms.
(d) Compliance of Agreement and Related Documents With Laws, Etc. The
---------------------------------------------------------------
execution, delivery and performance of this Reimbursement Agreement and the
Related Documents in accordance with their respective terms do not and will not,
by the passage of time, the giving of notice or otherwise, (i) require any
Governmental Approval or violate any Applicable Law relating to the Company,
(ii) conflict with, result in a breach of or constitute a default under the
articles of incorporation or bylaws of the Company, or any indenture, lease,
loan or credit agreement, instrument or other contract or agreement to which the
Company is a party or by which the Company or any of its properties may be
bound, which conflict, breach or default would have a Material Adverse Effect,
-28-
or (iii) result in or require the creation or imposition of any Lien upon or
with respect to any property now owned or hereafter acquired by the Company.
(e) Business. Neither the Company nor any of its Subsidiaries is
--------
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any margin stock
(within the meaning of Regulations U and X of the Board of Governors of the
Federal Reserve System). The correct corporate name of the Company is "▇▇▇▇▇▇
Riverside, LLC" and the Company does not conduct and, during the five-year
period immediately preceding the Closing Date, has not conducted, business under
any trade name or other fictitious name. The Company's chief executive office is
located at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
(f) Compliance With Law; Governmental Approvals. The Company (i) has
---------------------------------------------
all Governmental Approvals required by any Applicable Law relating to the
Company, each of which is in full force and effect, is final and not subject to
review on appeal and is not the subject of any pending or threatened attack by
direct or collateral proceeding and (ii) is in compliance with each Governmental
Approval applicable to it and in compliance with all other Applicable Law
relating to the Company, the failure to comply with which would have a Material
Adverse Effect.
(g) Titles to Properties. The Company has good, marketable and legal
---------------------
title to, or a valid leasehold interest in, its properties and assets, including
but not limited to those reflected on the balance sheets of the Company referred
to in Section 4.1.(l) except those which have been disposed of by the Company
subsequent to the date of such balance sheets in the ordinary course of
business.
(h) Liens. Except as set forth in Part I of Schedule 4.1.(h), none of
-----
the properties of the Company is, as of the Closing Date, subject to any Lien,
except Permitted Liens. Except as set forth in Part II of Schedule 4.1.(h), no
financing statement under the Uniform Commercial Code as enacted in any
jurisdiction which names the Company as debtor or covers any property of the
Company has been filed and is still effective in any state or other jurisdiction
and the Company has not signed any such financing statement or any security
agreement authorizing any secured party thereunder to file any such financing
statement except for financing statements and security agreements in favor of
the Bank.
(i) Indebtedness and Guaranties. There is no indebtedness for Money
----------------------------
Borrowed. The Company has performed and is in material compliance with all of
the terms of such Indebtedness and Guaranties and all instruments and agreements
relating thereto, and no default or event of default, or event or condition
which with notice or lapse of time or both would constitute such a default or
event of default, exists as of the Closing Date with respect to any such
Indebtedness or Guaranty.
(j) Litigation. There are no actions, suits or proceedings pending
----------
(nor, to the knowledge of the Company, are there any actions, suits or
proceedings threatened, nor is there any basis therefor) against or in any other
-29-
way relating adversely to or affecting the Company or any of its property in any
court or tribunal or before any arbitrator of any kind or before or by any
governmental body except actions, suits or proceedings of the character normally
incident to the kind of business conducted by the Company which, if adversely
determined, would not singly or in the aggregate have a materially adverse
effect on the financial condition or operations of the Company and there are no
strikes or walkouts in progress relating to any labor contracts to which the
Company is a party.
(k) Tax Returns and Payments. All federal, state and other tax returns
------------------------
of the Company required by Applicable Law to be filed have been duly filed, and
all federal, state and other taxes, assessments and other governmental charges
or levies upon the Company and its properties, income, profits and assets which
are due and payable have been paid except any such nonpayment which is at the
time permitted under Section 5.6.
(l) Adverse Change. Since August 31, 1997, no material adverse change
--------------
in the business, assets, liabilities, financial condition, results of operations
or business prospects of the Company and the Affiliate Guarantors has occurred.
(m) ERISA. The Company and its Subsidiaries have no Plans and,
-----
consequently, are in compliance with ERISA, to the extent applicable, in all
material respects. No material liability to the PBGC or to a Multiemployer Plan
has been, or is expected by the Company to be, incurred by the Company or any
Subsidiary.
(n) Absence of Defaults. The Company is not in default under its
--------------------
articles of incorporation or bylaws, and no event has occurred, which has not
been remedied, cured or waived, (i) which constitutes a Default or Event of
Default, or (ii) which constitutes, or which with the passage of time or giving
of notice or both would constitute, a default or event of default by the Company
under any indenture, lease, loan or credit agreement, instrument or other
contract or agreement or judgment, decree or order to which the Company is a
party or by which the Company or any of its properties may be bound.
(o) Accuracy and Completeness of Information. All written information,
----------------------------------------
reports and other papers and data furnished to the Bank were, at the time the
same were so furnished, complete and correct in all material respects, to the
extent necessary to give the recipient a true and accurate knowledge of the
subject matter, or, in the case of financial statements, present fairly, in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved, the financial position of the Persons involved
as at the date thereof and the results of operations for such periods. No fact
is known to the Company which has had, or may in the future have (so far as the
Company can foresee), a materially adverse effect upon the financial condition
or operations of the Company or any Subsidiary which has not been set forth in
such information, reports or other papers or data or otherwise disclosed in
writing to the Bank prior to the Closing Date. No document furnished or written
statement made to the Bank in connection with the negotiation, preparation or
execution of this Reimbursement Agreement or any of the Related Documents
-30-
contains or will contain any untrue statement of a fact material to the
creditworthiness of the Company or omits or will omit to state a material fact
necessary in order to make the statements contained therein not misleading.
(p) Environmental Laws. The Company has obtained all permits, licenses
-------------------
and other authorizations which are required under Environmental Laws and is in
compliance in all material respects with all terms and conditions of the
required permits, licenses, and authorizations, and it is also in compliance in
all material respects with all other limitations, restrictions, conditions,
standards, prohibitions, requirements, obligations, schedules, and timetables
contained in the Environmental Laws. The Company is not aware of, and has not
received notice of, any past, present, or future events, conditions,
circumstances, activities, practices, incidents, actions, or plans which, with
respect to the Company, may interfere with or prevent compliance or continued
compliance with Environmental Laws, or may give rise to any common-law or legal
liability, or otherwise form the basis of any claim, action, demand, suit,
proceeding, hearing, study, or investigation, based on or related to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling or the emission, discharge, release or threatened release
into the environment, of any pollutant, contaminant, chemical, or industrial,
toxic, or hazardous substance or waste; and there is no civil, criminal, or
administrative action, suit, demand, claim, hearing, notice, or demand letter,
notice or violation, investigation, or proceeding pending or, to the Company's
knowledge, threatened, against the Company relating in any way to Environmental
Laws.
(q) Official Statement. Except for information contained therein
-------------------
describing the Bank, the Underwriter, the Issuer or exemption from taxation, as
to which no representation is made: (i) the Official Statement of the Issuer
relating to the Bonds is, and the Preliminary Official Statement of the Issuer
relating to the Bonds as of its issuance date was, and any supplement or
amendment to either thereof shall be, accurate in all material respects for the
purposes for which its use is, was, or shall be, authorized; and (ii) the
Official Statement does not, the Preliminary Official Statement as of its
issuance date did not, and any such supplement or amendment shall not, contain
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements made therein, in the light of the circumstances
under which they are or were made, not misleading.
(r) Representations and Warranties. None of the representations or
-------------------------------
warranties made by the Company in this Reimbursement Agreement, any other
Related Document to which it is a party or in any financial statement, exhibit
or document furnished in connection with this Reimbursement Agreement or any
other Related Document to which it is a party as of the respective dates of such
representations and warranties, contains any untrue statement of a material fact
or omits any material fact necessary to make the statements made not misleading.
(s) Representations and Warranties in Related Documents. Each
---------------------------------------------------------
representation and warranty made by the Company in the Related Documents are
hereby made to and for the benefit of the Bank as if the same were set forth
herein in full.
-31-
Section 4.2. Survival of Representations and Warranties.
------------------------------------------
All statements contained in any certificate, financial statement, legal
opinion or other instrument delivered by or on behalf of the Company pursuant to
or in connection with this Reimbursement Agreement or any Related Document to
which it is a party shall constitute representations and warranties made under
this Reimbursement Agreement. All representations and warranties made under this
Reimbursement Agreement shall be deemed to be made at and as of the Closing Date
and at and as of the date of any drawing under the Letter of Credit.
ARTICLE 5. AFFIRMATIVE COVENANTS.
Until the termination of this Reimbursement Agreement and the
expiration or cancellation of the Letter of Credit and the indefeasible
satisfaction and payment in full of all Obligations, the Company will, unless
the Bank shall otherwise consent in writing:
Section 5.1. Preservation of Existence and Similar Matters.
---------------------------------------------
Preserve and maintain its existence, rights, franchises, licenses and
privileges in the jurisdiction of its organization and qualify and remain
qualified as a limited liability company and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization.
Section 5.2. Compliance With Applicable Law.
------------------------------
Comply with all Applicable Law, including the obtaining of all
Governmental Approvals, relating to the Company.
Section 5.3. Maintenance of Property.
-----------------------
In addition to, and not in derogation of, the requirements of any of
the Related Documents, (a) protect and preserve all its trademarks, and maintain
in good repair, working order and condition all tangible properties utilized in
the Company's business operations, and (b) from time to time make or cause to be
made all needed and appropriate repairs, renewals, replacements and additions to
such properties, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times.
Section 5.4. Conduct of Business.
-------------------
At all times carry on its business in an efficient manner and engage
only in businesses in substantially the same fields as the business conducted on
the Closing Date.
-32-
Section 5.5. Insurance.
---------
Maintain, in addition to that required by the Deed to Secure Debt or
any of the other Related Documents, insurance with responsible insurance
companies against such risks and in such amounts as is customarily maintained by
similar businesses or as may be required by Applicable Law, and from time to
time deliver to the Bank upon its request a detailed list of the insurance then
in effect, stating the names of the insurance companies, the amounts and rates
of the insurance, the dates of the expiration thereof and the properties and
risks covered thereby.
Section 5.6. Payment of Taxes and Claims.
---------------------------
Pay or discharge when due: (a) all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits or upon any
properties belonging to it, and (b) all lawful claims of materialmen, mechanics,
carriers, warehousemen and landlords for labor, materials, supplies and rentals
which, if unpaid, might become a Lien on any properties of the Company or any of
its Subsidiaries; provided, however, that this Section shall not require the
payment or discharge of any such tax, assessment, charge, levy or claim which
the Company is contesting in good faith by appropriate proceedings which operate
to suspend the collection thereof and for which adequate reserves have been
established on the appropriate books of the Company.
Section 5.7. Accounting Methods and Financial Records.
----------------------------------------
Maintain a system of accounting, and keep such books, records and
accounts (which shall be true and complete), as may be required or as may be
necessary to permit the preparation of financial statements in accordance with
generally accepted accounting principles consistent with those followed in the
preparation of the financial statements referred to in Section 4.1.(l).
Section 5.8. Visits and Inspections.
----------------------
Permit representatives of the Bank, from time to time, as often as may
be reasonably requested, but only during normal business hours and subject to
reasonable procedures for the protection of proprietary processes, to: (a) visit
and inspect the properties of the Company, (b) inspect and make extracts from
its relevant books and records, including but not limited to management letters
prepared by independent accountants, and (c) discuss with its principal
officers, and its independent accountants, the business, assets, liabilities,
financial conditions, results of operations and business prospects of the
Company.
Section 5.9. Remarketing Agent, Underwriter and Trustee.
------------------------------------------
The Company will maintain a Remarketing Agent, Underwriter and Trustee
acceptable to the Bank.
-33-
Section 5.10. Environmental Law Compliance.
---------------------------
Comply in all material respects with all applicable Environmental Laws.
The Company will not permit any Person to use any Hazardous Materials at the
Project Site or at any of the Company's other places of business except such
materials as are incidental to the Company's normal course of business. The
Company shall provide the Bank, its agents, contractors, employees and
representatives with access to and copies of any and all data and documents
relating to or dealing with any Hazardous Materials used, generated,
manufactured, stored or disposed of by the Company's business operations within
5 days of the request therefor.
Section 5.11. Registration of Bonds.
---------------------
Cause all Bonds which it acquires, or which it has had acquired for its
account, to be registered forthwith in accordance with the Indenture in the name
of the Company and pledged to the Bank under the Pledge Agreement.
Section 5.12 Financial Covenants.
-------------------
Until the termination of this Reimbursement Agreement and the
expiration or cancellation of the Letter of Credit and the indefeasible
satisfaction and payment in full of all Obligations, the following financial
covenants will be maintained:
(i) Total Liabilities to Tangible Net Worth. ▇▇▇▇▇▇ Industries,
Inc. must maintain a ratio of Total Liabilities to Tangible Net Worth of not
greater than 3.80 to 1:0 quarterly, commencing April 30, 1998 and on each fiscal
quarter end thereafter.
As used above, Tangible Net Worth shall be calculated quarterly,
commencing April 30, 1998 and on each fiscal quarter end thereafter and shall be
defined as the sum of (a) common stock, paid-in capital and retained earnings
shown on the balance sheet of ▇▇▇▇▇▇ Industries, Inc. minus (b) the treasury
stock and intangible assets of ▇▇▇▇▇▇ Industries, Inc. as determined in
accordance with generally accepted accounting principles, which includes but is
not limited to, goodwill, covenants not to compete, capitalized patents and
trademarks.
(ii) Debt Service Coverage Ratio. ▇▇▇▇▇▇ Industries, Inc. shall
maintain a Debt Service Coverage Ratio of not less than 1.10 to 1.0 at the end
of each fiscal quarter commencing April 30, 1998, based upon the present fiscal
quarter and the previous three fiscal quarters. Debt Service Coverage shall be
defined as earnings before interest, taxes, depreciation, amortization and other
non-cash expenses, less distributions or dividends divided by the sum of
interest expense plus current maturities of long term debt and capital leases.
-34-
ARTICLE 6. INFORMATION
Section 6.1. Information.
-----------
Until the termination of this Reimbursement Agreement and the
expiration or cancellation of the Letter of Credit and the indefeasible
satisfaction and payment in full of all Obligations, the Company will, unless
the Bank shall otherwise consent in writing, furnish to the Bank at its office
then designated for notices pursuant to Section 9.1.:
(a) Quarterly Financial Statements. Within 45 days after the close of
-------------------------------
each fiscal quarter, the balance sheet and income statement of the Company and
the Affiliate Guarantors as of the end of such quarter and setting forth in each
case the financial position of the Company, or the Affiliate Guarantors, as
applicable, as of the date thereof and the results of operation for such period,
in comparative form including the figures for the corresponding periods of the
previous fiscal year, all of which shall be certified as true and correct by the
Chief Financial Officer or President of the Company.
(b) Audited Year-End Statements. Within 120 days after the end of each
---------------------------
fiscal year of the Company and the Affiliate Guarantors, the balance sheet of
the Company and the Affiliate Guarantors, as applicable, as at the end of such
fiscal year and the related statements of income, and with respect to the
Affiliate Guarantors only, the retained earnings and cash flow of the Affiliate
Guarantors for such fiscal year, setting forth in comparative form the figures
as at the end of and for the previous fiscal year, certified by independent
certified public accountants whose certificate shall be in scope and substance
satisfactory to the Bank and who shall have authorized the Affiliate Guarantors
to deliver such financial statements and certification thereof to the Bank
pursuant to this Reimbursement Agreement.
(c) Officer's Certificate. At the time the financial statements are
----------------------
furnished pursuant to Sections 6.1.(a) and (b), the Company and the Affiliate
Guarantors shall also furnish a certificate of their respective Chief Financial
Officer or President: (i) setting forth as at the end of such fiscal year, in
the case of financial statements furnished pursuant to Section 6.1.(b), with
respect to the Company, the calculations required to establish whether or not
the Company was in compliance with the requirements of Section 7.1. hereof, and
with respect to ▇▇▇▇▇▇ Industries, Inc., the calculations required to establish
whether or not ▇▇▇▇▇▇ Industries, Inc. was in compliance with the requirements
of Section 5.12 hereof and (ii) in all cases, stating that, to the best of such
officer's knowledge, information and belief, no Default or Event of Default
exists, or if such is not the case, specifying such Default or Event of Default
and its nature, when it occurred, whether it is continuing and the steps being
taken by the Company with respect to such event, condition or failure.
(d) Copies of Other Reports. (i) Promptly upon receipt thereof, copies
-----------------------
of all reports, if any, submitted to the Company by its independent public
accountants, including, without limitation, any management report; (ii) as soon
as practicable, copies of all financial statements and reports as the Company
-35-
shall send to its stockholders and of all registration statements and all
regular or periodic reports which the Company shall file, with the Securities
and Exchange Commission or any successor commission and (iii) from time to time
and promptly upon each request, such data, certificates, reports, statements,
opinions of counsel, documents or further information regarding the business,
assets, liabilities, financial condition, results of operations or business
prospects of the Company as the Bank may reasonably request and that the Company
has or without unreasonable expense can obtain.
(e) Notice of Litigation and Other Matters. Prompt notice of: (i) to
----------------------------------------
the extent the Company is aware of the same, the commencement of all proceedings
and investigations by or before any governmental or nongovernmental body and all
actions and proceedings in any court or other tribunal or before any arbitrator
against or in any other way relating adversely to, or adversely affecting, the
Company or any of its Subsidiaries or any of their respective properties, assets
or businesses, the adverse determination of which would have a materially
adverse effect on the financial condition or operations of the Company; (ii) any
amendment to the articles of incorporation or bylaws of the Company; (iii) any
change in the management of the Company and any change in the business, assets,
liabilities, financial condition, results of operations or business prospects of
the Company or any of its Subsidiaries which has had or may have any material
adverse effect on the financial condition or operations of the Company and (iv)
any Default or Event of Default or any event which constitutes or which with the
passage of time or giving of notice or both would constitute a default or event
of default by the Company under any indenture, lease, loan or credit agreement,
instrument or other contract or agreement to which the Company is a party or by
which the Company or any of its properties may be bound.
(f) ERISA. As soon as possible and in any event within 30 days after
-----
the Company knows, or has reason to know, that: (i) any Termination Event with
respect to a Plan has occurred or will occur; (ii) any Unfunded Vested Accrued
Benefits exist or (iii) the Company is in "default" (as defined in Section
4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan required
by reason of its complete or partial withdrawal (as described in Section 4203 or
4205 of ERISA) from such Plan, a certificate of the President or Chief Executive
Officer of the Company setting forth the details of such of the events described
in clauses (i) through (iii) as applicable and the action which is proposed to
be taken with respect thereto, together with any notice or filing which may be
required by the PBGC or other agency of the United States government with
respect to such of the events described in clauses (i) through (iii) as
applicable.
(g) Notification of Environmental Matters. Prompt notice of (i) any and
-------------------------------------
all enforcement, cleanup, remedial, removal, or other governmental or regulatory
actions instituted or threatened against or otherwise affecting the Collateral
or the Company's other business operations pursuant to any applicable
Environmental Laws; and (ii) all claims made or threatened by any Person against
the Company relating to damages, contribution, cost recovery compensation, loss
or injury resulting from any Hazardous Materials.
-36-
ARTICLE 7. NEGATIVE COVENANTS
Until the termination of this Reimbursement Agreement and the
expiration or cancellation of the Letter of Credit and the satisfaction in full
of all Obligations, the Company will not, unless the Bank shall give its prior
written consent:
Section 7.1. Indebtedness for Borrowed Money.
-------------------------------
Create, assume, or otherwise become or remain obligated in respect of,
or permit or suffer to exist or to be created, assumed or incurred or to be
outstanding any Indebtedness for Money Borrowed other than Indebtedness owing to
the Bank.
Section 7.2. Guaranties.
----------
Become or remain liable on or under any Guaranty.
Section 7.3. Investments.
-----------
Acquire, after the date hereof, any Business Unit or Investment or,
after such date, permit any Investment to be outstanding.
Section 7.4. Liens.
-----
Create, assume, incur or permit or suffer to exist or to be created,
assumed or incurred, any Lien upon any of its properties or assets of any
character whether now owned or hereafter acquired other than Permitted Liens.
In addition, ▇▇▇▇▇▇ Industries, ▇▇▇▇▇▇ Fixture Corporation and ▇▇▇▇▇▇
Construction, Inc., the general contractor of the Project, shall not be liable
for recourse real estate debt other than ▇▇▇▇▇▇ Industries on the Project and
▇▇▇▇▇▇ Fixture Corporation and ▇▇▇▇▇▇ Industries, Inc. for the existing debt on
the ▇▇▇▇▇ Ave. building owned by ▇▇▇▇▇▇ Fixture Corporation and any debt
resulting from the tax free exchange of the ▇▇▇▇▇ Ave. building.
Section 7.5. Merger, Consolidation and Sale of Assets.
----------------------------------------
Merge or consolidate with any other Person or sell, lease or transfer
or otherwise dispose of all or a substantial portion of its assets, or sell or
otherwise transfer all or a portion of the Project or of the Collateral or any
of the Company's interest therein, to any Person.
Section 7.6. Transaction With Affiliates.
---------------------------
Effect any transaction with any Affiliate or Subsidiary by which
inventory or any other asset or services of the Company is transferred to such
Affiliate or Subsidiary, or any similar item is transferred from such Affiliate
-37-
or Subsidiary to the Company, at less than FIFO cost or for more than fair
salable value, or enter into any other transaction with an Affiliate or
Subsidiary on terms more favorable to such Affiliate or Subsidiary than would be
reasonably expected to be given in a similar transaction with an unrelated
entity.
Section 7.7. Plans.
-----
Take any action which would result in the existence of any Unfunded
Vested Accrued Benefits under any Plans.
Section 7.8. Loans.
-----
Extend credit to or make any advance, loan, contribution or payment of
money or goods (other than normal compensation for personal services and travel
expenses in the ordinary course of business) to any Person.
Section 7.9. Change of Name; Change of Address of Chief Executive
---------------------------------------------------------
Office or Principal Place of Business in Georgia.
------------------------------------------------
Change (i) the Company's legal name or (ii) the address of the
Company's (a) chief executive office or (b) principal place of business in
Georgia.
Section 7.10. Judgment.
--------
Allow a judgment or order for the payment of money to be entered
against the Company or any Subsidiary by any court which exceeds $50,000 in
amount and allow such judgment or order to continue undischarged or unstayed for
thirty (30) days.
Section 7.11. Attachment.
----------
Allow a warrant or writ of attachment or execution or similar process
to be issued against (i) any property of the Company which warrant, writ,
execution or process exceeds $50,000 in value and allow said warranty, writ,
execution or process to continue undischarged or unstayed for ten (10) days or
(ii) any of the Collateral.
ARTICLE 8. DEFAULT.
Section 8.1. Events of Default.
-----------------
Each of the following shall constitute an Event of Default, whatever
the reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment or order of any court
or any order, rule or regulation of any governmental or nongovernmental body:
(a) Default in Payment. The Company shall fail to pay any amount
--------------------
payable to the Bank under any provision of Section 2.2., or any of the other
Obligations, when and as due (whether upon demand, at maturity, by reason of
acceleration or otherwise) which failure shall continue for a period of three
-38-
(3) days after written notice, specifying such failure and requesting that it be
remedied, given by the Bank to the Company and the Affiliate Guarantors, or
given by the Trustee to the Company; provided, however, that said notice may be
delivered by the Bank to the Company and the Affiliate Guarantors via facsimile
transmitted and confirmed by telephone.
(b) Misrepresentations. Any statement, representation or warranty made
------------------
by or on behalf of the Company orally or in writing under this Reimbursement
Agreement or under any Related Document, or in any other writing or statement at
any time furnished or made by or on behalf of the Company to the Bank, shall
prove to have been incorrect or misleading in any material respect when
furnished or made.
(c) Default in Performance. The Company shall fail to perform or
------------------------
observe any term, covenant, condition or agreement contained in this
Reimbursement Agreement or in any Related Document to which it is a party, or in
any other agreement between the Company and the Bank which failure shall
continue for a period of thirty (30) days after written notice, specifying such
failure and requesting that it be remedied, given by the Bank to the Company and
the Affiliates Guarantors or given by the Trustee to the Company, unless the
Bank shall agree in writing to an extension of such time prior to the expiration
thereof.
(d) [Intentionally Omitted]
(e) [Intentionally Omitted]
(f) Voluntary Bankruptcy Proceeding. The Company, any Subsidiary or any
-------------------------------
Affiliate shall: (i) commence a voluntary case under the United States
Bankruptcy Code; (ii) file a petition seeking to take advantage of any other
Applicable Laws relating to bankruptcy, insolvency, reorganization, winding up
or composition for adjustment of debts; (iii) apply for or consent to, or fail
to contest in a timely and appropriate manner, the appointment of, or the taking
of possession by, a receiver, custodian, trustee or liquidator of itself or of a
substantial part of its property, domestic or foreign; (iv) admit in writing its
inability to pay its debts as they become due; (v) make a general assignment for
the benefit of creditors; (vi) make a conveyance fraudulent as to creditors
under any Applicable Law or (vii) take any corporate action for the purpose of
effecting any of the foregoing.
(g) Involuntary Bankruptcy Proceeding. A case or other proceeding shall
---------------------------------
be commenced against the Company, any Subsidiary or any Affiliate in any court
of competent jurisdiction seeking (i) relief under the United States Bankruptcy
Code or under any other Applicable Laws relating to bankruptcy, insolvency,
reorganization, winding up or adjustment of debts or (ii) the appointment of a
trustee, receiver, custodian, liquidator or the like of the Company, such
Subsidiary or such Affiliate or of all or any substantial part of the assets,
-39-
domestic or foreign, of the Company, such Subsidiary or such Affiliate and such
case or other proceeding shall continue undischarged, undismissed and unstayed
for sixty (60) days.
(h) Litigation. The Company or any other Person a party thereto shall
----------
challenge or contest in any action, suit or proceeding in any court or before
any arbitrator or governmental body the validity or enforceability of this
Reimbursement Agreement or any Related Document or the enforceability of, or the
perfection or priority of the Bank's Lien in any of the Collateral.
(i) [Intentionally Omitted]
(j) [Intentionally Omitted]
(k) ERISA. (i) Any Termination Event with respect to a Plan shall
-----
occur; (ii) any Plan shall incur an "accumulated funding deficiency" (as defined
in Section 412 of the Code or Section 302 of ERISA) for which a waiver has not
been obtained in accordance with the applicable provisions of the Code and ERISA
or (iii) the Company is in "default" (as defined in Section 4219(c)(5) of ERISA)
with respect to payments to a Multiemployer Plan resulting from the Company's
complete or partial withdrawal (as described in Section 4203 or 4205 of ERISA)
from such Multiemployer Plan.
(l) [Intentionally Omitted]
(m) Sale of Project. The Company or the Issuer shall sell, convey or
---------------
otherwise transfer any of its interest in all or a portion of the Project
provided, however, that the Company may transfer personal property in the
ordinary course of business.
(n) Related Documents Defaults. Any "Event of Default" under and as
----------------------------
defined in any Related Document shall occur.
(o) Priority of Bank's Lien. The Bank's Lien in any of the Collateral
-----------------------
shall for any reason cease to be a valid, enforceable and first-priority Lien,
subject only to Permitted Liens.
(p) Affiliate Guaranties Defaults. Any "Event of Default" under and as
-----------------------------
defined in any Affiliate Guaranty shall occur.
Section 8.2. Remedies.
--------
(a) If any Event of Default (other than any Event of Default specified
in Section 8.1.(f) or (g)) shall have occurred and be continuing, the Bank may
(i) give notice to the Trustee pursuant to Section 6.02 of the Indenture
requesting the Trustee to declare the principal of all Bonds then outstanding
and all interest accrued and unpaid thereon to be due and payable, or (ii) make
demand upon the Company to, and forthwith upon such demand the Company shall,
pay to the Bank in same day funds at the Bank's office designated in such
-40-
demand, for deposit into the Cash Collateral Account, an amount equal to the
maximum amount then available to be drawn under the Letter of Credit. If any
Event of Default specified in sections 8.1.(f) or (g) shall have occurred and be
continuing, (x) the Bank shall give notice to the Trustee pursuant to Section
6.02 of the Indenture requesting the Trustee to declare the principal of all
Bonds then outstanding and all interest accrued and unpaid thereon to be due and
payable and (y) the Company shall pay to the Bank, immediately and without any
demand or notice by the Bank whatsoever, in same day funds at the Bank's office
designated in Section 9.1., for deposit in the Cash Collateral Account, an
amount equal to the maximum amount then available to be drawn under the Letter
of Credit.
Section 8.3. Additional Rights.
-----------------
The Bank shall have the right, upon the happening of any Event of
Default, in addition to any rights or remedies available to it hereunder, under
the Deed to Secure Debt and any other Related Document, to exercise all other
rights and remedies available to it by agreement, at law or in equity.
Section 8.4. Cash Collateral Account.
-----------------------
(a) Upon the happening of any Event of Default, in addition to any
other rights or remedies available to it hereunder, the Bank may require the
Company to create and the Company hereby agrees to create a demand deposit
account with the Bank (the "Cash Collateral Account"). The Cash Collateral
Account shall be in the name of the Company, but under the sole dominion and
control of the Bank and subject to the terms hereof.
(b) If requested by the Company and subject to the right of the Bank to
withdraw funds from the Cash Collateral Account as provided below, the Bank
will, so long as no Event of Default referred to Sections 8.1.(a), (f) or (g)
shall have occurred and be continuing, from time to time invest funds on deposit
in the Cash Collateral Account, reinvest proceeds of any such investments which
may mature or be sold, and invest interest or other income received from any
such investments, in each case in such Eligible Securities as the Company may
select and notify to the Bank. Such proceeds, interest or income which are not
so invested or reinvested in Eligible Securities shall, except as otherwise
provided in this Section, be deposited and held by the Bank in the Cash
Collateral Account. Eligible Securities from time to time purchased and held
pursuant to this subsection shall be referred to as "Collateral Securities" and
shall, for purposes of this Reimbursement Agreement, constitute part of the
funds held in the Cash Collateral Account in amounts equal to their respective
outstanding principal amounts.
(c) If at any time the Bank determines that any funds held in the Cash
Collateral Account are subject to any right or claim of any Person other than
the Bank or that the total amount of such funds is less than the maximum amount
at such time available to be drawn under the Letter of Credit, the Company will,
forthwith upon demand by the Bank, pay to the Bank, as additional funds to be
deposited and held in the Cash Collateral Account, an amount equal to the excess
-41-
of (i) such maximum amount at such time available to be drawn under the Letter
of Credit over (ii) the total amount of funds, if any, then held in the Cash
Collateral Account which the Bank determines to be free and clear of any such
right and claim.
(d) The Company hereby pledges and collaterally assigns to the Bank,
and grants to the Bank a security interest in, all funds held in the Cash
Collateral Account (including Collateral Securities) from time to time and all
proceeds thereof, as security for the Obligations. Nothing in this Section,
however, shall either obligate the Bank to require any funds to be deposited in
the Cash Collateral Account or limit the right of the Bank, which it may
exercise at any time and from time to time, to release to the Company any funds
held in the Cash Collateral Account pursuant to the other provisions of this
Section.
(e) The Bank may, at any time or from time to time after funds are
either deposited in the Cash Collateral Account or invested in Collateral
Securities, after selling, if necessary, any Collateral Securities, apply funds
then held in the Cash Collateral Account to the payment of any amounts, in such
order as the Bank may elect, as shall have become or shall become due and
payable by the Company to the Bank under this Reimbursement Agreement; provided,
however, the Bank shall not use any such funds to pay any drawings under the
Letter of Credit. The Company agrees that, to the extent notice of sale of any
Collateral Securities shall be required by law, at least five Business Days'
notice to the Company of the time and place of any public sale or the time after
which any private sale is to be made shall constitute reasonable notification.
The Bank may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it will so adjourned.
(f) Neither the Company nor any Person claiming on behalf of or through
the Company shall have any right to withdraw any of the funds held in the Cash
Collateral Account, except as otherwise provided in subsection (f) below and
except that upon the termination of the Letter of Credit in accordance with its
terms and the indefeasible payment and satisfaction in full of all Obligations,
any funds remaining in the Cash Collateral Account shall be returned by the Bank
to the Company or paid to whomever may be legally entitled thereto.
(g) So long as no Event of Default shall have occurred and be
continuing but subject to the immediately preceding subsection (b), the Bank
will release to the Company or at its order (i) interest or other income
received on Collateral Securities and (ii) at the written request of the
Company, funds held in the Cash Collateral Account in an amount up to but not
exceeding the excess, if any (immediately prior to the release of any such
funds), of (x) the total amount of funds held in the Cash Collateral Account
over (y) the maximum amount available to be drawn under the Letter of Credit.
-42-
(h) The Company agrees that it will not (i) sell or otherwise dispose
of any interest in the Cash Collateral Account or any funds held therein, or
(ii) create or permit to exist any Lien upon or with respect to the Cash
Collateral Account or any funds held therein, except as provided in or
contemplated by this Reimbursement Agreement.
(i) The Bank shall exercise reasonable care in the custody and
preservation of any funds held in the Cash Collateral Account and shall be
deemed to have exercised such care if such funds are accorded treatment
substantially equivalent to that which the Bank accords its own property, it
being understood that the Bank shall not have any responsibility for taking any
necessary steps to preserve rights against any parties with respect to any such
funds.
ARTICLE 9. MISCELLANEOUS
Section 9.1. Notices.
-------
Unless otherwise provided herein, notices and other communications provided for
or permitted hereunder shall be in writing and shall be mailed, telecopied or
delivered as follows:
If to the Company:
▇▇▇▇▇▇ Riverside, LLC
c/o Abrams Properties, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Holt, Ney, Zatcoff & ▇▇▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ("▇▇▇▇▇") ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-43-
If to the Bank:
NationsBank, N.A.
Northwest Commercial Banking Center
Riverwood 100
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Cease
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & Bird LLP
One Atlantic Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
or, as to each party at such other address as shall be designated by such party
in a written notice to the other parties. All such notices and other
communications shall be effective when received. In the case of notice permitted
by telephone, all such notices shall be confirmed in writing within one Business
Day upon the giving thereof; provided, however, the terms of any such telephonic
notice shall be controlling over any conflicting terms contained in the
confirmatory written notice.
Section 9.2. Fees and Expenses.
-----------------
The Company will pay all out-of-pocket expenses of the Bank in
connection with:
(a) the preparation, execution and delivery of this Reimbursement
Agreement and each of the Related Documents, whenever the same shall be executed
and delivered, including appraisers' fees, title insurance fees, search fees,
recording fees and the reasonable fees and disbursements of ▇▇▇▇▇▇ & Bird LLP,
counsel for the Bank, as actually incurred based upon the total number of hours
of work performed and not based upon the statutory limit set forth in Official
Code of Georgia Annotated Section 13-1-11;
(b) the preparation, execution and delivery of any waiver, amendment or
consent by the Bank relating to this Reimbursement Agreement or any of the
Related Documents including reasonable fees and disbursements of counsel to the
Bank;
-44-
(c) any restructuring, refinancing or "workout" of the indebtedness
evidenced by this Reimbursement Agreement and the Related Documents including
the reasonable fees and disbursements of counsel to the Bank;
(d) following an Event of Default, consulting with one or more Persons,
including accountants and lawyers, concerning or related to the nature, scope or
value of any right or remedy of the Bank hereunder or under any of the Related
Documents, including any review of factual matters in connection therewith,
which expenses shall include the reasonable fees and disbursements of such
Persons and which consultations in any event shall be reasonable given the facts
and circumstances;
(e) the collection or enforcement of the obligations of the Company
under this Reimbursement Agreement or any Related Document including the
reasonable fees and disbursements of counsel to the Bank if such collection or
enforcement is done by or through an attorney;
(f) prosecuting or defending any claim in any way arising out of,
related to, or connected with this Reimbursement Agreement or any of the Related
Documents, which expenses shall include the reasonable fees and disbursements of
legal counsel, experts and other consultants retained by the Bank;
(g) the exercise by the Bank of any right or remedy granted to it under
this Reimbursement Agreement or any of the Related Documents, including the
reasonable fees and disbursements of counsel to the Bank; and
(f) to the extent not already covered by any of the preceding
subsections, any bankruptcy or other proceeding of the type described in
Sections 8.1.(f) or (g), and the fees and disbursements of counsel to the Bank
incurred in connection with the representation of the Bank in any matter
relating to or arising out of any such proceeding, including without limitation
(i) any motion for relief from any stay or similar order, (ii) the negotiation,
preparation, execution and delivery of any document relating to the Bank and
(iii) the negotiation and preparation of any plan of reorganization of the
Company, whether proposed by the Company, the Bank or any other Person, and
whether such fees and expenses are incurred prior to, during or after the
commencement of such proceeding or the confirmation or conclusion of any such
proceeding.
Section 9.3. Litigation.
----------
(a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY
BETWEEN THE COMPANY AND THE BANK WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES
OF LAW AND FACT AND LIKELY TO RESULT IN UNDESIRABLE EXPENSE AND DELAY.
ACCORDINGLY, THE BANK AND THE COMPANY HEREBY WAIVE THE RIGHT TO TRIAL BY JURY IN
ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH
AN ACTION MAY BE COMMENCED BY OR AGAINST THE COMPANY ARISING OUT OF, OR RELATING
TO, THIS REIMBURSEMENT AGREEMENT OR ANY OF THE RELATED DOCUMENTS.
-45-
(b) EACH OF THE COMPANY AND THE BANK HEREBY AGREES THAT THE FEDERAL
COURT OF THE NORTHERN DISTRICT OF GEORGIA, OR AT THE OPTION OF THE BANK ANY
STATE COURT LOCATED IN ▇▇▇▇▇▇▇ COUNTY, GEORGIA, SHALL HAVE JURISDICTION TO HEAR
AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE COMPANY AND THE BANK PERTAINING
DIRECTLY OR INDIRECTLY TO THIS REIMBURSEMENT AGREEMENT OR ANY OF THE RELATED
DOCUMENTS OR TO ANY MATTER ARISING HEREFROM OR THEREFROM. THE COMPANY EXPRESSLY
SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING
COMMENCED IN SUCH COURT, HEREBY WAIVING PERSONAL SERVICE OF THE SUMMONS AND
COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREEING THAT SERVICE
OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY
REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE COMPANY AT THE COMPANY'S ADDRESS
FOR NOTICES. SHOULD THE COMPANY FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT,
PROCESS OR PAPERS SERVED IN ACCORDANCE WITH APPLICABLE LAW WITHIN THIRTY DAYS
AFTER THE SERVICE THEREOF, IT SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR
JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS,
COMPLAINT, PROCESS OR PAPERS. THE CHOICE OF FORUM SET FORTH IN THIS SECTION
SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE BANK OR THE
ENFORCEMENT BY THE BANK OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER
APPROPRIATE JURISDICTION.
(c) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND
WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF.
Section 9.4. Right of Set-Off.
----------------
The Bank is hereby authorized at any time and from time to time, to the
fullest extent permitted by Applicable Law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held, and other Indebtedness at any time owing, by the Bank to or for the credit
or the account of the Company against any and all of the obligations,
irrespective of whether or not the Bank shall have made any demand hereunder and
although such Obligations may be contingent or unmatured. The Bank agrees
promptly to notify the Company after any such set-off and application above,
-46-
provided that the failure to give such notice shall not affect the validity of
such set-off and application. The rights of the Bank under this Section are in
addition to other rights and remedies (including without limitation, other
rights of set-off) which the Bank may have.
Section 9.5. Indemnification.
---------------
The Company hereby agrees to indemnify the Bank and any of its
officers, directors, shareholders, controlling Persons, employees, agents and
attorneys (collectively, "Indemnified Persons") and to hold such Indemnified
Persons harmless from and against, any and all claims, damages, losses,
liabilities, costs or expenses which any Indemnified Person may incur or which
may be claimed by any Person against any Indemnified Person:
(a) by reason of any inaccuracy in any material respect, or any untrue
statement or alleged untrue statement of any material fact, contained in the
Preliminary Official Statement or the Official Statement or any amendment or
supplement thereto, or by reason of the omission or alleged omission to state
therein a material fact necessary to make such statements, in the light of the
circumstances under which they were made, not misleading; provided, however,
that, in the case of any action or proceeding alleging an inaccuracy in a
material respect, or an untrue statement, with respect to information supplied
by and describing the Bank in the Preliminary Official Statement or the Official
Statement (the "Bank Information"), (i) indemnification by the Company pursuant
to this Section shall be limited to the costs and expenses of the Indemnified
Person (including fees and expenses of Bank's counsel) of defending itself
against such allegation, (ii) if in any such action or proceeding it is finally
determined that the Bank Information contained an inaccuracy in a material
respect or an untrue statement, then the Company shall not be required to
indemnify the Indemnified Person for any claims, damages, losses, liabilities,
costs or expenses to the extent caused by such inaccuracy or untrue statement,
and (iii) if any such action or proceeding shall be settled by the Indemnified
Person without there being a final determination to the effect described in the
preceding clause (ii), then the Company shall be required to indemnify the
Indemnified Person pursuant to this Section only if such action or proceeding is
settled with the Company's consent; or
(b) by reason of or in connection with the execution, delivery or
performance of the Bonds, the Indenture, or the Agreement, or any transaction
contemplated by the Indenture or the Agreement; or
(c) by reason of or in connection with the lawful execution and
delivery or transfer of, or payment or failure to make lawful payment under, the
Letter of Credit;
provided, however, that the Company shall not be required to indemnify or hold
-------- -------
harmless an Indemnified Person pursuant to this Section for any claims, damages,
losses, liabilities, costs or expenses to the extent caused by such Indemnified
Person's willful misconduct or gross negligence. Nothing in this Section is
intended to limit the Company's obligations contained in Section 2.2. Without
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prejudice to the survival of any other obligation of the Company hereunder, the
indemnities and obligations of the Company contained in this Section shall
survive the payment in full the Obligations and the termination of the Letter of
Credit.
Section 9.6. Amendments.
----------
Except as otherwise expressly provided in this Reimbursement Agreement,
any consent or approval required or permitted by this Reimbursement Agreement or
in any Related Document to be given by the Bank may be given, and any term of
this Reimbursement Agreement or of any Related Document may be amended, and the
performance or observance by the Company of any terms of this Reimbursement
Agreement or such Related Document or the continuance of any Default or Event of
Default may be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written consent of the
Company and the written consent of the Bank. No waiver shall extend to or affect
any obligation not expressly waived or impair any right consequent thereon. No
course of dealing or delay or omission on the part of the Bank in exercising any
right shall operate as a waiver thereof or otherwise be prejudicial thereto. No
notice to or demand upon the Company shall entitle the Company to other or
further notice or demand in similar or other circumstances.
Section 9.7. Survival.
--------
Notwithstanding any termination of this Reimbursement Agreement or of
any of the Related Documents, the indemnities to which the Bank and the other
Indemnified Persons are entitled under the provisions of Sections 9.2. and 9.5.
and any other provision of this Reimbursement Agreement and the Related
Documents, shall continue in full force and effect and shall protect the Bank
and the other Indemnified Persons against events arising after such termination
as well as before.
Section 9.8. Titles and Captions.
-------------------
Titles and captions of Articles, Sections, subsections and clauses in
this Reimbursement Agreement are for convenience only, and neither limit nor
amplify the provisions of this Reimbursement Agreement.
Section 9.9. Severability of Provisions.
--------------------------
To the greatest extent permitted by law, any provision of this
Reimbursement Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective only to the extent of such
prohibition or unenforceability without invalidating the remainder of such
provision or the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
-48-
Section 9.10. GOVERNING LAW.
-------------
THIS REIMBURSEMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.
Section 9.11. Assignment.
----------
The provisions of this Reimbursement Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns, except that the Company may not assign or transfer any of its
rights under this Reimbursement Agreement or any Related Document.
Section 9.12. Participations.
--------------
The Bank may at any time sell, assign, transfer, negotiate, and grant
participations in, or otherwise dispose of, all or any portion of its rights,
benefits and/or obligations under this Reimbursement Agreement and under any
Related Document to any Person and in the event of any such disposition by the
Bank, all references herein to the Bank shall be deemed a reference to the
Bank's transferee or participant to the extent of its participation. The Company
hereby consents to the disclosure of financial or other information received by
the Bank concerning the Company to the Bank's transferee or participant (or
prospective transferees and participants). The Company hereby agrees that any
transferee or participant purchasing a participation in the Bank's rights under
this Reimbursement Agreement may exercise all rights of offset, banker's lien
and counterclaim with respect to such participation. In the case of any such
transfer, participation or disposition, such transferee or participant shall
have all rights and duties under this Reimbursement Agreement as if such
transferee or participant were the Bank.
Section 9.13. Further Assurances.
------------------
The Company will, at any and all times, pass, execute and deliver all
such further documents, resolutions, assignments, recordings, filings, transfers
and assurances as may be necessary or desirable in the reasonable judgment of
the Bank for the better assuring and confirming of all of the rights, revenues
and other funds pledged or assigned to or mortgaged for the payment of the
Company's obligations hereunder, or intended so to be. The Company hereby
authorizes and empowers the Bank to sign on behalf of the Company as its
attorney-in-fact, and to file, any financing or continuation statement or any
amendments thereto with respect to any security pledged or assigned to the Bank
in accordance with the Uniform Commercial Code or any applicable jurisdiction.
Section 9.14. Counterparts.
------------
This Reimbursement Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and which shall
constitute the same agreement.
-49-
Section 9.15. ENTIRE AGREEMENT.
----------------
THIS REIMBURSEMENT AGREEMENT AND THE OTHER RELATED DOCUMENTS SET FORTH
AND CONSTITUTE THE ENTIRE AGREEMENT BETWEEN HE PARTIES HERETO WITH RESPECT TO
THE TRANSACTIONS SET FORTH HEREIN AND THE CREDIT FACILITY DESCRIBED HEREBY.
(Signatures on following page)
-50-
IN WITNESS WHEREOF, the parties hereto have caused this Letter of
Credit and Reimbursement Agreement to be duly executed and delivered under seal
as of the date first above written.
▇▇▇▇▇▇ RIVERSIDE, LLC
By: ▇▇▇▇▇▇ PROPERTIES, INC., its sole member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
ATTEST:
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Asst. Secretary
(CORPORATE SEAL)
(Signatures continued on following page)
(Signature page to Letter of Credit and Reimbursement Agreement)
NATIONSBANK, N.A.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
EXHIBIT A to LETTER OF CREDIT
AND REIMBURSEMENT AGREEMENT
IRREVOCABLE LETTER OF CREDIT
NATIONSBANK, N.A.
Letter of Credit No. Issue Date Stated Expiration Date Maximum Amount
931974 November 12, 1997 November 15, 2002 $11,162,739.72
AmSouth Bank
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Ladies and Gentlemen:
At the request and on the instructions of our customer, ▇▇▇▇▇▇
Riverside, LLC, a Georgia limited liability company (the "Company"), we hereby
establish this Irrevocable Letter of Credit (the "Letter of Credit") in the
amount not to exceed $11,162,739.72 (the "Initial Stated Amount"; and, as the
same may from time to time be reduced and thereafter reinstated as hereinafter
provided, the "Available Amount"), consisting of (i) an aggregate amount not
exceeding $11,000,000, which may be drawn upon with respect to payment of the
unpaid principal amount of, or portion of, the purchase price corresponding to
the principal of, the Bonds, as certified to us and (ii) an aggregate amount not
exceeding $162,739.72, which may be drawn upon with respect to the payment of
interest on the Bonds or portion of the purchase price representing accrued
interest on the Bonds, as certified to us, in your favor, as Trustee under that
certain Trust Indenture, dated as of October 1, 1997 (the "Indenture"), by and
between you, as Trustee, and Development Authority of ▇▇▇▇▇▇▇ County, Georgia
(the "Issuer"), pursuant to which the Issuer has issued $11,000,000 in aggregate
principal amount of its Taxable Industrial Development Revenue Bonds (▇▇▇▇▇▇
Riverside, LLC Project), Series 1997 (the "Bonds"). This Letter of Credit is
effective immediately and expires on November 15, 2002, or such later date to
which the Stated Expiration Date has been extended in accordance with the terms
hereof (the "Stated Expiration Date").
We hereby irrevocably authorize you to draw on us, in accordance with
the terms and conditions hereinafter set forth, (1) in one or more drawings by
your draft payable one Business Day (as hereinafter defined) after sight, drawn
on us, and accompanied by your written and completed certificate signed by you
in substantially the form of Annex A attached hereto (such draft being your
"Interest Draft"), an amount not to exceed $162,739.72 (representing 36-days'
interest on the Bonds at a maximum rate of 15% per annum, computed on the basis
of actual number of days elapsed over a year of 365 or 366 days, as applicable),
subject to reduction or reinstatement, if applicable, as hereinafter provided,
(2) in one or more drawings by your draft or drafts payable one Business Day
after sight, drawn on us, and, for each such drawing, accompanied by your
written and completed certificate signed by you in substantially the form of
Annex B attached hereto (any such draft being your "Partial Redemption Draft"),
an aggregate amount not to exceed $11,000,000, subject to reduction as
hereinafter provided, (3) in one or more drawings by your draft or drafts
payable one Business Day (or in certain circumstances as-described herein on-the
same Business Day) after sight, drawn on us, and, for each such drawing,
accompanied by your written and completed certificate signed by you in
substantially the form of Annex C attached hereto (any such draft being your
"Mandatory Purchase Draft"), an aggregate amount not to exceed $11,162,739.72
(representing the principal amount of the Bonds plus 36 days' interest coverage
at a maximum rate of 15% per annum, computed on the basis of actual number of
days elapsed over a year of 365 or 366 days, as applicable), subject to
reduction or reinstatement, if applicable, as hereinafter provided, and (4) in a
single drawing by your draft payable one Business Day after sight, drawn on us,
and accompanied by your written and completed certificate signed by you in the
form of Annex D attached hereto (such draft being your "Final Draft"), an amount
not to exceed $11,162,739.72 (representing the principal amount of the Bonds
plus 36-days' interest coverage at a maximum rate of 15% per annum, computed on
the basis of actual number of days elapsed over a year of 365 or 366 days, as
applicable), subject to reduction as hereinafter provided. Any such draft, with
the accompanying certificate, drawn in strict conformity with the terms and
conditions of this Letter of Credit and presented at our office as hereinafter
set forth prior to 11:00 a.m. (Atlanta, Georgia time) on any Business Day shall
be honored by us not later than 3:00 p.m. (Atlanta, Georgia time) on the same
day or on such later Business Day as you may specify. Any such draft, with the
accompanying certificate, drawn in strict conformity with the terms and
conditions of this Letter of Credit and presented at our office as hereinafter
set forth after the time specified hereinabove shall be honored by us not later
than 3:00 p.m. (Atlanta, Georgia time) on the next Business Day thereafter or on
such later Business Day as you may specify.
Your right to draw on us by your Interest Draft(s) shall be reduced by
the amount of any drawing or drawings theretofore made on us by your Mandatory
Purchase Draft(s) and attributable to interest on the Bonds, unless reinstated.
Your right to draw on us by your Partial Redemption Draft(s), your Mandatory
Purchase Draft(s) and your Final Draft shall also be reduced by the amount of
any drawing or drawings theretofore made on us by your Partial Redemption
Draft(s) and, unless reinstated, your Mandatory Purchase Draft(s).
Your right to draw on us in a single drawing by your Interest Draft
under clause (1) above shall be automatically and irrevocably reinstated and,
effective the first Business Day following the date of our honoring such
Interest Draft and you shall again be irrevocably authorized to draw on us in
accordance with clause (1) and the other terms and conditions referred to or set
2
forth above, in a drawing by your Interest Draft; and this automatic
reinstatement of your right to draw on us by your Interest Draft under clause
(1) above shall be applicable to successive drawings by your Interest Drafts
under clause (1) so long as this Letter of Credit shall not have terminated as
set forth below.
If you shall draw on us by your Mandatory Purchase Draft and thereafter
you shall receive and confirm to us by telephone at telephone number (214)
▇▇▇-▇▇▇▇ that you hold in trust for our account collected and immediately
available funds constituting the proceeds of the remarketing of all or a portion
of the Bonds tendered to you for purchase in accordance with the terms of the
Indenture, such confirmation shall automatically reinstate your right to draw on
us (i) by your Interest Draft under clause (1) above in the amount of the
drawing made on us by such Mandatory Purchase Draft and attributable to interest
on the Bonds that have been remarketed and for which you are holding proceeds,
(ii) by your Partial Redemption Draft(s) under clause (2) above, in the amount
of the drawing made on us by such Mandatory Purchase Draft and attributable to
principal on the Bonds that have been remarketed and for which you are holding
proceeds and (iii) by your Mandatory Purchase Draft(s) under clause (3) above
and your Final Draft under clause (4) above, in the amount of the drawing made
on us by such Mandatory Purchase Draft and attributable to the Bonds that have
been remarketed and for which you are holding proceeds. Upon the resale and
delivery of the Bonds in such amount under the Indenture and your telephonic
confirmation to us, you shall again be irrevocably authorized to draw on us in
accordance with clauses (1) through (4) in the second paragraph hereof, and the
other terms and conditions referred to or set forth above, in a single or
multiple drawing as set forth above; and this automatic reinstatement of your
right to draw on us shall be applicable to successive drawings hereunder so long
as this Letter of Credit shall not have been terminated as set forth below. We
shall thereafter promptly confirm such reinstatement in writing, but such
written confirmation to you by us shall not be required to effect such
reinstatement.
Subject to the provisions set forth above for reinstatement of amounts
drawn under the Letter of Credit by your Mandatory Purchase Draft(s), drawings
under the Letter of Credit honored by us shall not, in the aggregate, exceed the
face amount of this Letter of Credit as reduced from time to time as hereinabove
provided.
Funds under this Letter of Credit are available to you against (1) your
Interest Draft accompanied by your written and completed certificate signed by
you in substantially the form of Annex A attached hereto, (2) your Partial
Redemption Draft accompanied by your written and completed certificate signed by
you in substantially the form of Annex B attached hereto, (3) your Mandatory
Purchase Draft accompanied by your written and completed certificate signed by
you in substantially the form of Annex C attached hereto, and (4) your Final
Draft accompanied by your written and completed certificate signed by you in
substantially the form of Annex D attached hereto. To the extent that amounts
are available to be drawn by your Interest Draft, such Interest Draft may be
presented together with your Partial Redemption Draft (but not your Final
3
Draft). Each such draft shall include thereon a reference to the number of this
Letter of Credit and each such draft and certificate shall be dated the date of
its presentation and shall be presented at our office located at NationsBank of
Texas, N.A., Letter of Credit Dept., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, Attention: Standby Letter of Credit Department, or if delivered via
facsimile, to facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, or at any other office which may
be designated by us on at least five Business Days' prior written notice to you.
Demand for payment hereunder may also be made in the form of facsimile
transmission of the final Draft hereunder to the address and telecopy number
shown above, but only after first giving notice to us in the form of a facsimile
transmission at (▇▇▇) ▇▇▇-▇▇▇▇, and receiving verbal approval to telecopy such
Final Draft to us at telephone number (▇▇▇) ▇▇▇-▇▇▇▇. You must confirm our
receipt of each telecopied Final Draft by telephoning the above numbers Only
upon such confirmation shall the demand under the Final Draft be deemed made. We
agree that all payments made by us hereunder will be made with our own funds.
This Letter of Credit shall automatically terminate upon the earliest
to occur of: (i) our honoring your Final Draft hereunder; (ii) your surrendering
this Letter of Credit to us for cancellation as a result of (A) the payment in
full of the Bonds (whether by maturity, acceleration, redemption or otherwise)
pursuant to the provisions of the Indenture or (B) the acceptance by you of an
Alternate Credit Facility (as defined in the Indenture), as certified by you to
us; (iii) the Stated Expiration Date; or (iv) the Business Day following the
Conversion Date (as defined in the Indenture), unless waived in writing by us
prior to the Conversion Date.
If a demand for payment made by you hereunder does not, in any
instance, conform to the terms and conditions of this Letter of Credit, we shall
give you prompt written notice that the demand was not effected in accordance
with the terms and conditions of this Letter of Credit, stating the reasons
therefor and that we are holding any documents at your disposal or are returning
the same to you, as we may elect. Such notice shall be sent to you by telecopy
to the following number: (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Corporate Trust Department.
Upon being notified that the demand was not effected in conformity with this
Letter of Credit, you may attempt to correct any such non-conforming demand for
payment if, and to the extent that, you are able to do so in accordance with
terms of this Letter of Credit and within the expiration date of the Letter of
Credit.
Communications with respect to this Letter of Credit shall be in
writing and shall be addressed to us at NationsBank of Texas, N.A., Letter of
Credit Department, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Standby
Letter of Credit Department, and specifically referring to the number of this
Letter of Credit. The term "Business Day" as used herein shall mean any Monday,
Tuesday, Wednesday, Thursday or Friday on which each of the Trustee, the
Remarketing Agent and us is open for business; provided, that for purposes of
counting the number of Business Days prior to a given day, "Business Day" means
any Monday, Tuesday, Wednesday, Thursday or Friday on which each of the Trustee,
the Remarketing Agent and we are scheduled to be open for business regardless of
whether each such entity is in fact open for business on such day.
4
This Letter of Credit is subject to the Uniform Customs and Practice
for Documentary Credits (1993 Revision), International Chamber of Commerce,
Publication No. 500 (the "Uniform Customs") with the exceptions of Articles
48(f) and 48(g) thereof. This Letter of Credit shall be deemed to be a contract
made under the laws of the State of Georgia and shall, as to matters not
governed by the Uniform Customs, be governed by and constructed in accordance
with the laws of the State of Georgia, including the Uniform Commercial Code as
in effect in the State of Georgia.
Any drawing under this Letter of Credit will be paid from our general
funds and not directly or indirectly from funds or collateral deposited with us
for our account by the Company, or pledged with or for our account by the
Company.
This Letter of Credit is transferable in its entirety to any transferee
who has succeeded you as Trustee under the Indenture. Each letter of credit
issued upon any such transfer may be successively transferred. Transfer of the
available drawing(s) under this Letter of Credit to such transferee shall be
effected by the presentation to us of this Letter of Credit accompanied by a
written and completed certificate signed by you in the form of Annex E attached
hereto. Upon such presentation we shall forthwith transfer the same to your
transferee or, if so requested by your transferee, issue an irrevocable letter
of credit to your transferee in the form of this Letter of Credit.
The Stated Expiration Date may be extended from time to time, at our
sole discretion, by our delivery to you of a written and completed certificate
in the form of Annex F hereto. Each such extension of the Stated Expiration Date
shall become effective on the Business Day following delivery of such notice 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 notice. Any date to which the Stated Expiration Date has been extended
as herein provided may, at our sole discretion, be extended in a like manner. No
further action shall be required to extend such expiration date, and no
substitute letter of credit shall be issued to effect such extension.
5
This Letter of Credit sets forth in full our undertaking, and such
undertaking shall not in any way be modified, amended, amplified or limited by
reference to any document, instrument or agreement referred to herein
(including, without limitation, the Bonds), other than the certificates and the
drafts referred to herein; and any such reference shall not be deemed to
incorporate herein by reference any document, instrument or agreement except for
such certificates and such drafts.
Very truly yours,
NATIONSBANK, N.A.
By:_______________________
Its:_________________
ANNEX A
CERTIFICATE FOR DRAWING IN CONNECTION
WITH THE PAYMENT OF INTEREST ON THE
DEVELOPMENT AUTHORITY OF ▇▇▇▇▇▇▇ COUNTY, GEORGIA
TAXABLE INDUSTRIAL DEVELOPMENT REVENUE BONDS
(▇▇▇▇▇▇ RIVERSIDE, LLC PROJECT), SERIES 1997
The undersigned, a duly authorized officer of AmSouth Bank, a state
banking corporation organized and existing under the laws of the State of
Alabama, as trustee (the "Trustee"), hereby certifies to NationsBank, N.A., a
national banking association, as issuer of the Letter of Credit (the "Bank"),
with reference to Irrevocable Letter of Credit No. ____________ (the "Letter of
Credit") issued by the Bank in favor of the Trustee, that:
(1) The Trustee is the trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the Letter of Credit with
respect to a payment, pursuant to the terms of the Indenture, of interest on the
Bonds, which payment is due and payable on a regular interest payment date on
the record date for such interest payment date, and none of such Bonds for which
interest is drawn pursuant to the draft were held of record by the Company or by
the Bank, its designees, as pledgee of the Company.
(3) The amount of the Interest Draft accompanying this Certificate is
$___________, being drawn in respect of such interest, and does not include any
amount of interest on the Bonds included in any Interest Draft or Mandatory
Purchase Draft (that has not been reinstated) presented to you and not
dishonored by you on or prior to the date of presentation hereof.
(4) [The Interest Draft accompanying this Certificate is the first
Interest Draft presented by the Trustee under the Letter of Credit.]
[The Interest Draft accompanying this Certificate is an Interest Draft
presented by the Trustee under the Letter of Credit.]
(5) The amount of the Interest Draft accompanying this Certificate was
computed in accordance with the terms and conditions of the Bonds and the
Indenture and does not exceed the amount available to be drawn by an Interest
Draft under the Letter of Credit.
-----------------------------
[FN]
To be used in the Certificate relating to the first interest Draft only.
To be used in each Certificate relating to each Interest Draft other
than the first Interest Draft.
(6) This Certificate and the Interest Draft it accompanies are dated,
and are being presented to the Bank on, the date that is one Business Day prior
to the date on which interest on the Bonds with respect to which this drawing is
being made is due and payable under the terms of the Bonds and the Indenture.
All capitalized terms used but not defined herein shall have the
meaning assigned thereto in the Letter of Credit.
IN WITNESS WHEREOF, the Trustee has executed this Certificate as of the
____ day of _________________, 19__.
AMSOUTH BANK, as Trustee
By:____________________________
Its: Authorized Officer
ANNEX B
CERTIFICATE FOR DRAWING IN CONNECTION WITH
THE PAYMENT OF PRINCIPAL AND UP TO THIRTY-SIX (36) DAYS'
INTEREST UPON PARTIAL REDEMPTION OF THE
DEVELOPMENT AUTHORITY OF ▇▇▇▇▇▇▇ COUNTY, GEORGIA
TAXABLE INDUSTRIAL DEVELOPMENT REVENUE BONDS
(▇▇▇▇▇▇ RIVERSIDE, LLC PROJECT), SERIES 1997
The undersigned, a duly authorized officer of AmSouth Bank, a state
banking corporation organized and existing under the laws of the State of
Alabama (the "Trustee"), hereby certifies to NationsBank, N.A., a national
banking association, as issuer of the Letter of Credit (the "Bank"), with
reference to Irrevocable Letter of Credit No. ______________ (the "Letter of
Credit") issued by the Bank in favor of the Trustee, that:
(1) The Trustee is the trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the Letter of Credit with
respect to the payment, pursuant to the terms of the Indenture, of less than all
of the unpaid principal of the Bonds which are outstanding under the Indenture,
of the unpaid principal amount of and up to thirty-six (36) days' accrued and
unpaid interest on, the Bonds to be redeemed pursuant to the Indenture (other
than Bonds presently held of record by the Company or by the Bank, or its
designee, as pledgee of the Company).
(3) The amount of the Partial Redemption Draft accompanying this
Certificate is equal to the sum of (i) $__________ being drawn in respect of the
payment of unpaid principal of the Bonds to be redeemed and (ii) $____________
being drawn in respect of the payment of thirty-six (36) days accrued and unpaid
interest on such Bonds, and does not include any amount of principal on the
Bonds included in any Partial Redemption Draft, Mandatory Purchase Draft that
has not been reinstated or Final Draft presented to you and not dishonored by
you on or prior to the date of presentation hereof.
(4) The amount of the Partial Redemption Draft accompanying this
Certificate was computed in accordance with the terms and conditions of the
Bonds and the Indenture and does not exceed the amount available to be drawn
with respect to principal of the Bonds under the Letter of Credit.
(5) This Certificate and the Partial Redemption Draft it accompanies
are dated, and are being presented to the Bank on, the date that is one Business
Day prior to the date on which unpaid principal of the Bonds with respect to
which this drawing is being made is due and payable under the terms of the Bonds
and the Indenture.
The Trustee acknowledges that, pursuant to the terms of the Letter of
Credit, upon your honoring the Partial Redemption Draft accompanying this
Certificate, (a) the total amount available under the Letter of Credit and the
amounts available to be drawn by the Trustee thereunder by any subsequent
Partial Redemption Draft and Final Draft are automatically decreased by an
amount equal to the amount specified in paragraph (3) above as being drawn in
respect of the payment of unpaid principal and accrued interest thereon of the
Bonds.
All capitalized terms used but not defined herein shall have the
meaning assigned thereto in the Letter of Credit.
IN WITNESS WHEREOF, the Trustee has executed this Certificate as of the
____ day of _________________, 19__.
AMSOUTH BANK, as Trustee
By:___________________________
Its: Authorized Officer
B-2
ANNEX C
CERTIFICATE FOR DRAWING IN CONNECTION WITH
THE PAYMENT OF THE PURCHASE PRICE UPON MANDATORY PURCHASE
OF THE DEVELOPMENT AUTHORITY OF ▇▇▇▇▇▇▇ COUNTY, GEORGIA
TAXABLE INDUSTRIAL DEVELOPMENT REVENUE BONDS
(▇▇▇▇▇▇ RIVERSIDE, LLC PROJECT), SERIES 1997
The undersigned, a duly authorized officer of AmSouth Bank, a state
banking corporation organized and existing under the laws of the State of
Alabama, as trustee (the "Trustee"), hereby certifies to NationsBank, N.A., a
national banking association, as issuer of the Letter of Credit (the "Bank"),
with reference to Irrevocable Letter of Credit No. _____________ (the "Letter of
Credit") issued by the Bank in favor of the Trustee, that:
(1) The Trustee is the trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the Letter of Credit with
respect to a payment of the purchase price of the Bonds which are outstanding
within the meaning of the Indenture (other than Bonds presently held of record
by the Company or an affiliate, or by the Bank, or its designee, as pledgee of
the Company) upon mandatory purchase or optional or mandatory tender.
(3) The amount of the Mandatory Purchase Draft accompanying this
Certificate is $__________ (representing $___________ of principal and
$__________ of interest), being drawn in respect of the payment of the purchase
price of Bonds properly tendered or deemed tendered for purchase, and does not
include any amount of principal on the Bonds included in any other Mandatory
Purchase Draft (except to the extent of your reinstatement of the amount which
may be drawn thereby under the terms of the Letter of Credit), or in any Partial
Redemption Draft or Final Draft presented to you, and not dishonored by you, on
or prior to the date of presentation hereof.
(4) The Bonds being purchased with the proceeds of the Mandatory
Purchase Draft accompanying this Certificate are being registered in the name of
the Company or its nominee and held by the Trustee subject to the pledge of such
Bonds to the Bank, all in accordance with the Indenture, the Pledge Agreement,
dated as of October 1, 1997, by and among ▇▇▇▇▇▇ Riverside, LLC (the "Company"),
the Bank and the Trustee, and the Letter of Credit and Reimbursement Agreement,
dated as of October 1, 1997, by and between the Company and the Bank.
(5) The amount of the Mandatory Purchase Draft accompanying this
Certificate was computed in accordance with the terms and conditions of the
Bonds and the Indenture and does not exceed the amount available to be drawn
under the Letter of Credit with respect to the purchase price of the Bonds.
(6) This Certificate and the Mandatory Purchase Draft it accompanies
are dated, and are being presented to the Bank on, the date that is not more
than one Business Day prior to the date on which the purchase price of the Bonds
with respect to which this drawing is being made is due and payable under the
terms of the Bonds and the Indenture.
The Trustee acknowledges that, pursuant to the terms of the Letter of
Credit, upon your honoring the Mandatory Purchase Draft accompanying this
Certificate, the total amount of the Letter of Credit and the amounts available
to. be drawn by the Trustee thereunder by (i) any subsequent Mandatory Purchase
Draft, Partial Redemption Draft, and Final Draft are automatically decreased by
an amount equal to the amount specified in paragraph (3) above as being drawn in
respect of the payment of unpaid principal of the Bonds, unless such amount is
reinstated in the manner provided in the Letter of Credit, and (ii) any
subsequent Interest Draft, Mandatory Purchase Draft and Final Draft is
automatically decreased by an amount equal to the amount specified in paragraph
(3) above as being drawn in respect of the payment of unpaid interest on the
Bonds, unless such amount is reinstated in the manner provided in the Letter of
Credit.
All capitalized terms used but not defined herein shall have the
meaning assigned thereto in the Letter of Credit.
IN WITNESS WHEREOF, the Trustee has executed this Certificate as of the
____ day of _________________, 19__.
AMSOUTH BANK, as Trustee
By:___________________________
Its: Authorized Officer
C-2
ANNEX D
CERTIFICATE FOR DRAWING IN CONNECTION WITH
THE PAYMENT OF ENTIRE OUTSTANDING
PRINCIPAL OF AND INTEREST ON THE
DEVELOPMENT AUTHORITY OF ▇▇▇▇▇▇▇ COUNTY, GEORGIA
TAXABLE INDUSTRIAL DEVELOPMENT REVENUE BONDS
(▇▇▇▇▇▇ RIVERSIDE, LLC PROJECT), SERIES 1997
---------------------------------------------
The undersigned, a duly authorized officer of AmSouth Bank, a state
banking corporation organized and existing under the laws of the State of
Alabama, as trustee (the "Trustee"), hereby certifies to NationsBank, N.A., a
national banking association, as issuer of the Letter of Credit (the "Bank"),
with reference to Irrevocable Letter of Credit No. ____________ (the "Letter of
Credit") issued by the Bank in favor of the Trustee, that:
(1) The Trustee is the trustee under the Indenture for the holders of
the Bonds.
(2) The Trustee is making a drawing under the Letter of Credit with
respect to a payment, either at stated maturity of the last Bonds to mature or
upon acceleration or as a result of a redemption as a whole pursuant to the
Indenture of the unpaid principal amount of, and up to thirty-six (36) days'
accrued and unpaid interest on all of the Bonds which are outstanding within the
meaning of the Indenture (other than Bonds presently held of record by the
Company or by the Bank, or its designee, as pledgee of the Company) and any
premium applicable to the Bonds upon such redemption or acceleration.
(3) The amount of the Final Draft accompanying this Certificate is
equal to the sum of (i) $__________ of the Bonds being drawn in respect of
unpaid principal of the Bonds and (ii) $__________ being drawn in respect of
unpaid interest on the Bonds, and does not include any amount of principal of or
interest on the Bonds included in any Interest Draft or Mandatory Purchase Draft
that has not been reinstated, or Partial Redemption Draft presented and not
dishonored by you on or prior to the date of this Certificate.
(4) The amount of the Final Draft accompanying this Certificate was
computed in accordance with the terms and conditions of the Bonds and the
Indenture and does not exceed the amount available to be drawn by a Final Draft
under the Letter of Credit.
(5) This Certificate and the Final Draft it accompanies are dated, and
are being presented to the Bank on, the date that is one Business Day prior to
the date on which the unpaid principal of, and interest on, all of the Bonds
which are outstanding under the Indenture is due and payable under the terms of
the Bonds and the Indenture.
The Trustee acknowledges that, pursuant to the terms of the Letter of
Credit, upon your honoring the Final Draft accompanying this Certificate, the
entire amount available to be drawn by the Trustee under the Letter of Credit
shall have been drawn and the Letter of Credit shall terminate automatically.
All capitalized terms used but not defined herein shall have the
meaning assigned thereto in the Letter of Credit.
IN WITNESS WHEREOF, the Trustee has executed this Certificate as of the
____ day of _________________, 19__.
AMSOUTH BANK, as Trustee
By:___________________________
Its: Authorized Officer
D-2
ANNEX E
INSTRUCTIONS TO TRANSFER
------------------------
__________________, 19__
NationsBank of Texas, N.A.
Letter of Credit Dept.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Standby Letter of Credit Department
Re: Irrevocable Letter of Credit No. ______________
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby irrevocably
transfers to:
(Name of Transferee)
(Address)
all rights of the undersigned beneficiary to draw under the above Letter of
Credit. Such transferee has succeeded the undersigned beneficiary as Trustee
under the Indenture.
By this transfer, all rights of the undersigned beneficiary in such
Letter of Credit are transferred to the transferee and the transferee shall
hereafter have the sole rights as beneficiary thereof; provided, however, that
no rights shall be deemed to have been transferred to the transferee until such
transfer complies with the requirements of such Letter of Credit pertaining to
transfers.
Such Letter of Credit is returned herewith and in accordance therewith
we ask you to transfer the same to the transferee or, if so requested by the
transferee, to issue a new irrevocable letter of credit in favor of the
transferee with provisions consistent with such Letter of Credit.
All capitalized terms used but not defined herein shall have the
meaning assigned thereto in such Letter of Credit.
AMSOUTH BANK, as Trustee
By:__________________________
Its: Authorized Officer
E-1
ANNEX F
EXTENSION CERTIFICATE
---------------------
__________________, 19__
AmSouth Bank
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Re: NationsBank, N.A.
Irrevocable Letter of Credit No. _____________
Securing the Development Authority of ▇▇▇▇▇▇▇ County,
Georgia Taxable Industrial Development Revenue Bonds (▇▇▇▇▇▇
Riverside, LCC Project), Series 1997
Ladies and Gentlemen:
Reference is made to that certain Irrevocable Letter of Credit No.
____________, dated October ___, 1997 (the "Letter of Credit"), issued by
NationsBank, N.A. in your favor as beneficiary. We hereby extend the Stated
Expiration Date (as defined in the Letter of Credit) from _______________,
_____, to _______________, _____.
Other than as set forth above, all rights of the beneficiary to draw
under the above Letter of Credit shall remain as set forth in such Letter of
Credit.
NATIONSBANK, N.A., as issuer of
the Letter of Credit
By:___________________________
Its: Authorized Officer
F-1
EXHIBIT B
FORM OF PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT, dated as of November 1, 1997 (this "Pledge
Agreement"), by and among ▇▇▇▇▇▇ RIVERSIDE, LLC, a Georgia limited liability
company (the "Company"), AMSOUTH BANK, as trustee (the "Trustee") and
NATIONSBANK, N.A., as issuer of the Letter of Credit (the "Bank").
WHEREAS, the Development Authority of ▇▇▇▇▇▇▇ County, Georgia (the
"Issuer") is to issue $11,000,000 in aggregate principal amount of its Taxable
Industrial Development Revenue Bonds (▇▇▇▇▇▇ Riverside, LLC Project), Series
1997, (the "Bonds"), pursuant to that certain Trust Indenture, dated as of
November 1, 1997 (the "Indenture"), by and between the Issuer and the Trustee,
for the purpose of financing the acquisition, construction and equipping of a
facility for the manufacturing of store fixtures, located in ▇▇▇▇▇▇▇ County,
Georgia;
WHEREAS, pursuant to the terms of that certain Lease Agreement, dated
as of November 1, 1997 (the "Agreement"), by and between the Issuer and the
Company, the Issuer will lease the Project to the Company and the Company has
agreed to pay amounts under the Agreement to the Issuer at such times and in
such amounts as necessary to provide for the payment of the principal of,
premium (if any) and interest on, and the purchase price of, the Bonds when due;
WHEREAS, in order to fulfill the requirements of the Indenture, the
Company has requested that the Bank issue its Irrevocable Letter of Credit No.
931974, dated November 12, 1997 (the "Letter of Credit"), for the benefit of the
Trustee and for the account of the Company, to provide a credit facility for
payment of the principal of and interest on the Bonds on the scheduled due dates
and upon redemption or acceleration;
WHEREAS, the Bank is willing to issue the Letter of Credit subject to
and on the terms and conditions of that certain Letter of Credit and
Reimbursement Agreement, dated as of November 1, 1997 (as the same may be
amended, supplemented, restated or otherwise modified from time to time in
accordance with its terms, the "Reimbursement Agreement"), by and between the
Bank and the Company;
WHEREAS, to secure its obligations to the Bank under the Reimbursement
Agreement, the Company is willing to grant to the Bank a security interest in,
among other things, the Pledged Bonds (as defined below); and
WHEREAS, it is a condition precedent to the effectiveness of the
Reimbursement Agreement and the issuance by the Bank of the Letter of Credit
that the Company and the Trustee execute and deliver this Pledge Agreement;
NOW, THEREFORE, in consideration of the premises, in order to induce
the Bank to issue the Letter of Credit and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by
the parties hereto, the parties hereto agree as follows:
Section 1. Grant of Security Interest. As security for the payment and
--------------------------
performance of the Obligations, the Company hereby grants to the Bank a security
interest in, and pledges, assigns, transfers and delivers to the Bank, all of
the Company's right, title and interest (if any) in and to all of the following
(collectively, the "Pledged Bonds"): (a) any Bond during the period from and
including the date of its purchase with amounts realized under the Letter of
Credit to but excluding the date on which such Bond is remarketed to any Person
other than the Bank, or the Company reimburses the Bank for the amounts drawn on
the Letter of Credit to purchase such Bond, together with all proceeds thereof,
and (b) all documents, books and records of the Company relating thereto.
Section 2. Representations and Warranties of the Company. The Company
---------------------------------------------
hereby represents and warrants to the Trustee and the Bank that: The execution,
delivery and performance of this Pledge Agreement by the Company in accordance
with its terms do not and will not, by the passage of time, the giving of notice
or otherwise; (a) require any Governmental Approval or violate any Applicable
Law relating to the Company; (b) conflict with, result in a breach of or
constitute a default under the articles of incorporation or bylaws of the
Company, or any indenture, lease, loan or credit agreement, instrument or other
contract or agreement to which the Company is a party or by which the Company or
any of its properties may be bound; (c) result in or require the creation or
imposition of any Lien upon or with respect to any property now owned or
hereafter acquired by the Company; (d) no financing statement, mortgage, notice
of lien, security agreement or any other agreement or instrument creating or
giving notice of any Lien against any of the Pledged Bonds is in existence or on
file in any public office; (e) on the date of delivery to the Bank or the
Trustee, on behalf of the Bank, of any Pledged Bonds, neither the Issuer, the
Remarketing Agent, nor the Trustee will have any right, title or interest in or
to the Pledged Bonds; (f) the Company has, and on the date of delivery to the
Bank or the Trustee, on behalf of the Bank, of any Pledged Bonds will have, full
power, authority and legal right to grant to the Bank a security interest in all
of the Company's right, title and interest (if any) in and to the Pledged Bonds
pursuant to this Pledge Agreement and the terms of the Reimbursement Agreement;
and (g) the pledge, assignment, transfer and delivery of the Pledged Bonds
pursuant to this Pledge Agreement and the Reimbursement Agreement will create a
valid, perfected and first-priority security interest in favor of the Bank in
all right, title and interest of the Company (if any) in and to the Pledged
Bonds.
Section 3. Covenants of the Company and the Trustee. The Company and
----------------------------------------
the Trustee hereby covenant and agree that:
2
(a) The Company will not create, assume, incur or permit or suffer
to exist or to be created, assumed or incurred, any Lien on any of the Pledged
Bonds other than the security interest herein granted (if any), and will not
sell, assign, transfer or otherwise dispose of any of the Pledged Bonds (or any
interest therein).
(b) The Trustee will at all times keep the Pledged Bonds separate
and distinct from other property of the Trustee and shall keep accurate and
complete records of the Pledged Bonds.
(c) The Company will defend its right, title and interest (if any)
in and to, and the Bank's security interest (if any) in, the Pledged Bonds
against claims and demands of all Persons.
Section 4. The Pledged Bonds.
-----------------
(a) Payments on the Pledged Bonds. If while this Pledge Agreement
------------------------------
is in effect the Company shall become entitled to receive or shall receive any
principal or interest payment in respect of any of the Pledged Bonds, the
Company agrees to accept the same as the Bank's agent and to hold the same in
trust on behalf of the Bank and to deliver the same forthwith to the Bank or to
the Bank's nominee as directed by the Bank. All monies so paid in respect of the
Pledged Bonds which are received by the Company and paid to the Bank or its
nominee or received directly by the Bank or its nominee shall be credited
against the Company's Obligations under the Reimbursement Agreement in
accordance with the Reimbursement Agreement.
(b) Release of Pledged Bonds. If the Company makes or causes to be
------------------------
made a payment to the Bank in respect of its reimbursement obligations under the
Reimbursement Agreement with respect to the Pledged Bonds, the Bank agrees to
release its security interest under this Pledge Agreement to the extent, in the
manner and under the terms and conditions set forth below and to treat such
payment in the manner set forth herein and to take all such other actions
required to be taken by the Bank hereunder. Pledged Bonds shall be released
hereunder and shall be delivered to the Company or on its order upon (i) payment
in full to the Bank by the Company, or from the proceeds of remarketing of
Pledged Bonds, of the amount of the drawing made by the Trustee with respect to
such Pledged Bonds plus interest as provided in the Reimbursement Agreement to
and through the date of such payment to the Bank, and (ii) receipt by the Bank
thereafter of a notice directing the Bank to deliver to the Company or on its
order, on the date specified in such notice, a principal amount of such Pledged
Bonds equal to the principal portion of the amount so paid and setting forth the
particular Pledged Bonds to be delivered. The Company shall (x) receive a credit
against its obligations to pay interest pursuant to the Reimbursement Agreement
to the extent of any amounts received by the Bank or its nominee as interest on
any Pledged Bonds, and (y) receive a credit against its payment obligations
under the Reimbursement Agreement to the extent of any amounts received by the
Bank or its nominee as the principal due on any Pledged Bonds. The Trustee and
the Bank shall not release any Pledged Bonds unless the Letter of Credit has
3
terminated and any and all amounts due to the Bank have been paid in full or
unless the Principal Component (as defined in the Letter of Credit) of the
Stated Amount is reinstated in an amount equivalent to the sum of the
outstanding principal amount of the Pledged Bonds to be released or sold, and
the Interest Component (as defined in the Letter of Credit) of the Stated Amount
is reinstated in an amount equal to 60-days' interest on such principal amount
calculated at the Maximum Rate (as defined in the Letter of Credit) on the basis
of a 365 or 366 day year, as applicable.
Section 5. Remedies Upon Default. In addition to any right or remedy
-----------------------
that the Bank may have under the Reimbursement Agreement, the other Related
Documents or otherwise under Applicable Law, if an Event of Default shall have
occurred, the Bank may exercise any and all the rights and remedies of a secured
party under the Uniform Commercial Code as in effect in any applicable
jurisdiction (the "Code") and may otherwise sell, assign, transfer, endorse and
deliver the whole or, from time to time, any part of the Pledged Bonds at a
public or private sale or on any securities exchange, for cash, upon credit or
for other property, for immediate or future delivery, and for such price or
prices and on such terms as the Bank in its discretion shall deem appropriate.
The Bank shall be authorized at any sale (if it deems it advisable to do so) to
restrict the prospective bidders or purchasers to Persons who will represent and
agree that they are purchasing the Pledged Bonds for their own account in
compliance with the Securities Act of 1933, as amended, and upon consummation of
any such sale the Bank shall have the right to assign, transfer, endorse and
deliver to the purchaser or purchasers thereof the Pledged Bonds so sold. Each
purchaser at any sale of Pledged Bonds shall take and hold the property sold
absolutely free from any claim or right on the part of the Company, and the
Company hereby waives (to the fullest extent permitted by Applicable Law) all
rights of redemption, stay and/or appraisal which the Company now has or may at
any time in the future have under any Applicable Law now existing or hereafter
enacted. The Company agrees that, to the extent notice of sale shall be required
by Applicable Law, at least ten days' prior written notice to the Company of the
time and place of any public sale or the time after which any private sale is to
be made shall constitute reasonable notification, but notice given in any other
reasonable manner or at any other reasonable time shall constitute reasonable
notification. At any such sale, the Pledged Bonds, or portion thereof to be
sold, may be sold in one lot as an entirety or in separate parcels, as the Bank
may determine in its sole and absolute discretion. In addition to exercising the
power of sale herein conferred upon it, the Bank shall also have the option to
proceed by suit or suits at law or in equity to foreclose this Pledge Agreement
and sell the Pledged Bonds or any portion thereof pursuant to judgment or decree
of a court or courts having competent jurisdiction.
Section 6. Application of Proceeds. The proceeds of any sale of the
-------------------------
whole or any part of the Pledged Bonds shall be applied by the Bank in payment
of any of the Obligations, in any order which the Bank may elect. The Company
shall remain liable and will pay, on demand, any deficiency remaining in respect
of the Obligations.
4
Section 7. Bank Appointed Attorney-in-Fact. The Company hereby
----------------------------------
constitutes and appoints the Bank as the attorney-in-fact of the Company with
full power of substitution either in the Bank's name or in the name of the
Company to do any of the following: (a) to perform any obligation of the Company
hereunder in the Company's name or otherwise; (b) to ask for, demand, ▇▇▇ for,
collect, receive, receipt and give acquittance for any and all moneys due or to
become due under and by virtue of any Pledged Bonds; (c) to prepare, execute,
file, record or deliver notices, assignments, financing statements, continuation
statements or like papers to perfect, preserve or release the Bank's security
interest in the Pledged Bonds or any of the documents, instruments, certificates
and agreements described in Section 8; (d) to endorse checks, drafts, orders and
other instruments for the payment of money payable to the Company, representing
any interest or other distribution payable in respect of the Pledged Bonds or
any part thereof or on account thereof and to give full discharge for the same;
(e) to exercise all rights, powers and remedies which the Company would have,
but for this Pledge Agreement, under the Pledged Bonds; and (f) to carry out the
provisions of this Pledge Agreement and to take any action and execute any
instrument which the Bank may deem necessary or advisable to accomplish the
purposes hereof, and to do all acts and things and execute all documents in the
name of the Company or otherwise, deemed by the Bank as necessary, proper and
convenient in connection with the preservation, perfection or enforcement of its
rights hereunder. Nothing herein contained shall be construed as requiring or
obligating the Bank to make any commitment or to make any inquiry as to the
nature or sufficiency of any payment received by it, or to present or file any
claim or notice, or to take any action with respect to the Pledged Bonds or any
part thereof or the moneys due or to become due in respect thereof or any
property covered thereby, and no action taken by the Bank or omitted to be taken
with respect to the Pledged Bonds or any part thereof shall give rise to any
defense, counterclaim or offset in favor of the Company or to any claim or
action against the Bank. The power of attorney granted herein is irrevocable and
coupled with an interest.
Section 8. Further Assurances. The Company shall, at its sole cost and
------------------
expense, take all action that may be necessary or desirable in the Bank's
opinion, or that the Bank may request, so as at all times to maintain the
validity, perfection, enforceability and priority of the Bank's security
interest in the Pledged Bonds (if any), or to enable the Bank to exercise or
enforce its rights hereunder, including without limitation, executing and
delivering financing statements, pledges, designations, notices and assignments,
in each case in form and substance satisfactory to the Bank, relating to the
creation, validity, perfection, priority or continuation of the security
interest granted hereunder (if any). The Company agrees to take, and authorizes
the Bank to take on the Company's behalf, any or all of the following actions
with respect to any Pledged Bonds as the Bank shall deem reasonably necessary to
perfect the security interest and pledge created hereby or to enable the Bank to
enforce its rights and remedies hereunder: (a) to register in the name of the
Bank any Pledged Bonds in certificated or uncertificated form; (b) to endorse in
the name of the Bank any Pledged Bonds issued in certificated form; and (c) by
book entry or otherwise, identify as belonging to the Bank a quantity of
securities that constitutes all or part of the Pledged Bonds registered in the
name of the Bank. Notwithstanding the foregoing the Company agrees that Pledged
5
Bond which is not in certificated form or is otherwise in book-entry form shall
be held for the account of the Bank. The Company hereby authorizes the Bank to
execute and file in all necessary and appropriate jurisdictions (as determined
by the Bank) one or more financing or continuation statements in the name of the
Company and to sign the Company's name thereto. The Company authorizes the Bank
to file any such financing statement, document or instrument without the
signature of the Company to the extent permitted by applicable law. Any property
comprising part of the Pledged Bonds required to be delivered to the Bank
pursuant to this Pledge Agreement shall be accompanied by proper instruments of
assignment duly executed by the Company and by such other instruments or
documents as the Bank or its counsel may request.
Section 9. Rights Cumulative; Non-Waiver of Rights. The rights and
-------------------------------------------
remedies of the Bank under this Pledge Agreement are cumulative and not
exclusive of any rights or remedies which it would otherwise have. No delay or
failure on the part of the Secured Party in the exercise of any right or remedy
shall operate as a waiver thereof, no single or partial exercise by the Secured
Party of any right or remedy shall preclude other or further exercise thereof or
the exercise of any other right or remedy and no course of dealing between the
parties shall operate as a waiver of any right or remedy of the Secured Party.
Section 10. Indemnification. The Company agrees to indemnify and hold
---------------
the Bank and any corporation controlling, controlled by, or under common control
with, the Bank and any officer, attorney, director, shareholder, agent or
employee of the Bank or any such corporation (each an "Indemnified Person"),
harmless from and against any claim, loss, damage, action, cause of action,
liability, cost and expense or suit of any kind or nature whatsoever
(collectively, "Losses"), brought against or incurred by an Indemnified Person,
in any manner arising out of or, directly or indirectly, related to or connected
with this Pledge Agreement, including without limitation, the exercise by the
Bank of any of its rights and remedies under this Pledge Agreement or any other
action taken by the Bank pursuant to the terms of this Pledge Agreement;
provided, however, the Company shall not be liable to an Indemnified Person for
any Losses to the extent that such Losses result from the gross negligence or
willful misconduct of such Indemnified Person. The Company's obligations under
this section shall survive the termination of this Pledge Agreement and the
payment in full of the Obligations.
Section 11. Continuing Security Interest. This Pledge Agreement shall
-----------------------------
create a continuing security interest in the Pledged Bonds and shall remain in
full force and effect until indefeasible payment and performance in full of the
Obligations. The Company and the Bank hereby agree that the security interest
created by this Pledge Agreement in the Pledged Bonds shall not terminate and
shall continue and remain in full force and effect notwithstanding the transfer
to the Company or any Person designated by it of all or any portion of the
Pledged Bonds.
6
Section 12. Notices. Notices, requests and other communications
-------
required or permitted hereunder shall be given in accordance with the applicable
terms of the Reimbursement Agreement.
Section 13. Governing Law. This PLEDGE Agreement shall be governed by,
-------------
and construed in accordance with, the laws of the State of Georgia.
Section 14. Amendments. No amendment or waiver of any provision of this
----------
Pledge Agreement nor consent to any departure by the Company herefrom shall in
any event be effective unless the same shall be in writing and signed by the
parties hereto, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
Section 15. Binding Agreement; Assignment. This Pledge Agreement shall
------------------------------
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Company shall not be
permitted to assign this Pledge Agreement or any interest herein or in the
Pledged Bonds, or any part thereof, or any cash or property held by the Bank as
collateral under this Pledge Agreement.
Section 16. Termination. Upon indefeasible payment and performance in
-----------
full of all of the Obligations, this Pledge Agreement shall terminate. Upon
termination of this Pledge Agreement in accordance with its terms the Bank
agrees to take such actions as the Company may reasonably request, and at the
sole cost and expense of the Company, (a) to return Pledged Bonds in the Bank's
possession to the Company, and (b) to evidence the termination of this Pledge
Agreement, including, without limitation, the filing of any releases or any
termination statements under the Uniform Commercial Code.
Section 17. Severability. Whenever possible, each provision of this
------------
Pledge Agreement shall be interpreted in such a manner as to be effective and
valid under applicable law, but if any provision of this Pledge Agreement shall
be prohibited by or invalid under applicable law, such provisions shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Pledge Agreement to the greatest extent permitted by law.
Section 18. Headings. Section headings used herein are for convenience
--------
only and are not to affect the construction of or be taken into consideration in
interpreting this Pledge Agreement.
Section 19. Counterparts. This Pledge Agreement may be executed in any
------------
number of counterparts, each of which shall be deemed an original and all of
which shall constitute but one agreement.
7
Section 20. Definitions. All terms not otherwise defined herein shall
-----------
have the respective meanings given them in, or by reference in, the
Reimbursement Agreement.
(Signatures on following page)
8
IN WITNESS WHEREOF, the parties hereto have executed and delivered
under seal this Pledge Agreement as of the date first written above.
THE COMPANY:
▇▇▇▇▇▇ RIVERSIDE, LLC
By: ▇▇▇▇▇▇ PROPERTIES, INC.,
sole member
By:_________________________________
Title:_________________________
(Signatures continued on following page)
9
(Signature page to Pledge Agreement)
THE BANK:
NATIONSBANK, N.A.
By:_________________________________
Title:_________________________
(Signatures continued on following page)
10
(Signature page to Pledge Agreement)
THE TRUSTEE:
AMSOUTH BANK, as Trustee
By:________________________________
Title:_________________________
11
EXHIBIT C
FORM OF EXTENSION REQUEST
----------, -----
NationsBank, N.A.
Northwest Commercial Banking Center
Riverwood 100
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Cease
1. Reference is made to that certain Letter of Credit and
Reimbursement Agreement, dated as of November 1, 1997 (as amended from time to
time, the "Reimbursement Agreement"), by and between ▇▇▇▇▇▇ Riverside, LLC (the
"Company") and NationsBank, N.A. (the "Bank"). Unless otherwise indicated, all
terms defined in the Reimbursement Agreement have the same respective meanings
when used herein.
2. Pursuant to Section 2.11. of the Reimbursement Agreement, the
Company hereby requests (a) the Bank to consent to the extension of the Stated
Expiration Date of the Letter of Credit from ____________, 19__ to
_____________, 19__ and (b) the Bank to evidence such extension by delivering to
the Trustee an amendment to the Letter of Credit which effects the extension of
the Stated Expiration Date.
3. The Company hereby certifies to the Bank, that, on the date of
this Extension Request: (a) the representations and warranties set forth in the
Reimbursement Agreement and the Related Documents to which the Company is a
party are true and correct as if made on such date; (b) no Event of Default or
Default has occurred and is continuing; and (c) each of the Related Documents
remains in full force and effect.
IN WITNESS WHEREOF, the Company has duly executed under seal this
Extension Request on the date set forth above.
▇▇▇▇▇▇ RIVERSIDE, LLC
By: ▇▇▇▇▇▇ Properties, Inc., its sole member
By: ______________________________________
Title:
[CORPORATE SEAL]
EXHIBIT D
ATTACH FORM OF OPINION OF COMPANY COUNSEL
D-1
EXHIBIT E
DEVELOPMENT COST BREAKDOWN
Company: ▇▇▇▇▇▇ Riverside, LLC
Project: The Project, as defined in the Trust Indenture, dated as of November 1,
1997, by and between the Development Authority of ▇▇▇▇▇▇▇ County, Georgia and
AmSouth Bank, as trustee
Part A -- Cost Items
PART A-COST ITEMS TOTAL AMOUNT OF ITEM
--------- ----------------------------------------------------- -- -------------------------
| | | | |
| 1 | Construction Costs | | 6,444,201 |
|---------|-----------------------------------------------------|--|-------------------------|
| 2 | Land Purchase Costs | | 1,820,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 3 | Site Preparation (included in #1) | | 0 |
|---------|-----------------------------------------------------|--|-------------------------|
| 4 | Tenant Finish Allowance | | 0 |
|---------|-----------------------------------------------------|--|-------------------------|
| 5 | Architect's Fees (Borrower) | | 226,404 |
|---------|-----------------------------------------------------|--|-------------------------|
| 6 | Real Estate Taxes | | 633 |
|---------|-----------------------------------------------------|--|-------------------------|
| 7 | Title Insurance & Exam-Owner | | 12,617 |
|---------|-----------------------------------------------------|--|-------------------------|
| 8 | Attorney's Fees/Recording Fees | | 33,429 |
|---------|-----------------------------------------------------|--|-------------------------|
| 9 | Appraisal Fee | | 3,750 |
|---------|-----------------------------------------------------|--|-------------------------|
| 10 | Real Estate Commissions | | |
|---------|-----------------------------------------------------|--|-------------------------|
| 11 | Surveyor's/Soil Test Fees/EPA | | 22,355 |
|---------|-----------------------------------------------------|--|-------------------------|
| 12 | Inspecting Agent's Fees | | 4,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 13 | Contingency Reserve | | 366,866 |
|---------|-----------------------------------------------------|--|-------------------------|
| 14 | Land/A&E Int. Before NB Closing | | 14,642 |
|---------|-----------------------------------------------------|--|-------------------------|
| 15 | Loan Interest | | 253,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 16 | Underwriting | | 49,500 |
|---------|-----------------------------------------------------|--|-------------------------|
| 17 | Printing | | 1,125 |
|---------|-----------------------------------------------------|--|-------------------------|
| 18 | Bond/Underwriter Counsel | | 37,500 |
|---------|-----------------------------------------------------|--|-------------------------|
| 19 | Bank Counsel | | 20,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 20 | Development Authority Fee | | 12,500 |
|---------|-----------------------------------------------------|--|-------------------------|
| 21 | Development Authority Counsel | | 6,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 22 | Borrower Counsel | | 20,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 23 | Rating Agency | | 10,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 24 | Trustee Acceptance Fee | | 4,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 25 | Trustee Annual Fee-first year | | 4,325 |
|---------|-----------------------------------------------------|--|-------------------------|
| 26 | Letter of Credit Fee-first year | | 60,500 |
|---------|-----------------------------------------------------|--|-------------------------|
| 27 | DTC, CUSIP, SDF | | 2,100 |
|---------|-----------------------------------------------------|--|-------------------------|
| 28 | Legal Out of Pocket | | 5,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 29 | Remarketing-first year | | 6,875 |
|---------|-----------------------------------------------------|--|-------------------------|
| 30 | Finishing Systems | | 1,039,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 31 | Dust Collection System | | 261,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 32 | Layout Design Consultant | | 64,290 |
|---------|-----------------------------------------------------|--|-------------------------|
| 33 | Legal-Sublease & Miscellaneous | | 15,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| 34 | Title Insurance Premium-Lender | | 50 |
|---------|-----------------------------------------------------|--|-------------------------|
| 35 | Annual Assessment-Riverside | | 1,131 |
|---------|-----------------------------------------------------|--|-------------------------|
| 36 | Permits/Fees | | 25,830 |
|---------|-----------------------------------------------------|--|-------------------------|
| 37 | Miscellaneous | | 2,377 |
|---------|-----------------------------------------------------|--|-------------------------|
| 38 | Developer Overhead | | 150,000 |
|---------|-----------------------------------------------------|--|-------------------------|
| | TOTALS | | $11,000,000 |
---------- ----------------------------------------------------- -- -------------------------
E-1
EXHIBIT E
DEVELOPMENT COST BREAKDOWN
[TO BE ATTACHED]
E-2
EXHIBIT F
AMORTIZATION SCHEDULE
---------------------
YEAR PRINCIPLE
1999 190,000
2000 210,000
2001 230,000
2002 255,000
2003 280,000
2004 310,000
2005 340,000
2006 375,000
2007 410,000
2008 450,000
2009 500,000
2010 545,000
2011 600,000
2012 665,000
2013 730,000
2014 800,000
2015 885,000
2016 970,000
2017 1,075,000
2018 1,180,000
---------
TOTAL $11,000,000
E-3