TERMINATION, RELEASE AND ENHANCEMENT
LETTER OF CREDIT DOCUMENTS CONTINUATION AGREEMENT
TERMINATION, RELEASE AND ENHANCEMENT LETTER OF CREDIT DOCUMENTS
CONTINUATION AGREEMENT, dated June 23, 1997 (this "Agreement"), by and between
XXXXXX FINANCIAL, INC., in its individual capacity ("Xxxxxx") and as agent (in
such capacity, the "Agent") for the Lenders that are a party to the Credit
Agreement referred to below, ROLLER BEARING COMPANY OF AMERICA, INC. ("RBC") and
INDUSTRIAL TECTONICS BEARING CORPORATION ("ITB" and, together with RBC,
collectively referred to herein as the "Borrowers" and individually as a
"Borrower"). Capitalized terms used herein without being defined herein shall
have the respective meanings provided therefor in the Credit Agreement referred
to below.
WITNESSETH:
WHEREAS, the Borrowers, the Agent and certain financial institutions
(collectively, the "Lenders") are parties to a Second Amended and Restated
Credit Agreement, dated as of September 22, 1995 (as amended to the date hereof,
the "Credit Agreement"), whereby the Lenders have made Loans and other financial
accommodations available to the Borrowers;
WHEREAS, the Loans and other financial accommodations made available by
the Lenders to the Borrowers are secured by all of the assets of the Borrowers
and of the Borrowers' Subsidiaries identified in the Security Documents, all of
such Security Documents being set forth on Schedule 1 hereto;
WHEREAS, an Irrevocable Transferable Letter of Credit dated September 7,
1994 in the face amount of $10,853,904.11 (the "Enhancement Letter of Credit")
was issued by Xxxxxx to Xxxx Xxxxx Bank, as trustee (the "Trustee") under two
Trust Indentures, each dated as of September 1, 1994, and each between the South
Carolina Jobs - Economic Development Authority and the Trustee (the
"Indentures"), pursuant to the terms of a Letter of Credit Agreement dated
September 1, 1994 between RBC and Xxxxxx, as amended by a First Amendment to
Letter of Credit Agreement dated November 16, 1995 and a Second Amendment to
Letter of Credit Agreement of even date herewith (as so amended, the "Letter of
Credit Agreement");
WHEREAS, RBC's obligations to Xxxxxx under the Letter of Credit Agreement
are secured by a lien and security interest in RBC's interest in the "Trust
Estate" (as defined in the Indentures) and in the "Funds Collateral" (as defined
in the Letter of Credit Agreement);
WHEREAS, RBC's obligations to Xxxxxx under the Letter of Credit Agreement
are further secured pursuant to the terms of the Pledge and Security Agreement
dated September 1, 1994 among RBC, Xxxxxx and the Trustee (the "Letter of Credit
Pledge Agreement") (the Enhancement Letter of Credit, the Letter of Credit
Agreement, the Indentures, the Letter of Credit Pledge Agreement and all other
documents, instruments and agreements executed and
delivered to or for the benefit of Xxxxxx in connection with the Enhancement
Letter of Credit are hereinafter collectively referred to as the "Enhancement
Letter of Credit Documents").
WHEREAS, pursuant to this Agreement the Borrowers (i) intend, in
accordance with the terms of the Credit Agreement, to (a) terminate the
Revolving Loan Commitment and the Term Loan Commitment in full, (b) prepay in
full the outstanding principal balance of the Loans, together with all accrued
interest thereon, through and including the date hereof, (c) pay all other
amounts due and owing to the Agent and the Lenders as of the date hereof under
the terms of the Credit Agreement and the other Loan Documents (other than the
Enhancement Letter of Credit Documents) (the Loan Documents, other than the
Enhancement Letter of Credit Documents, being referred to collectively as the
"Credit Agreement Loan Documents"), (d) terminate each Lender Letter of Credit
and Risk Participation Agreement and satisfy any outstanding Risk Participation
Liability with respect thereto and (e) terminate all security interests in favor
of the Agent in the assets of the Borrowers and their Subsidiaries that were
granted pursuant to the Credit Agreement Loan Documents, and (ii) shall set
forth the terms on which the Enhancement Letter of Credit Documents will remain
effective;
NOW, THEREFORE, for good and valuable consideration, the parties hereto
agree as follows:
Section 1. Repayment of Obligations. The Agent hereby acknowledges receipt
of payment in immediately available funds of $51,792,614.06, constituting as of
the date hereof (a) all the outstanding principal amount of, and interest
accrued on, the Loans pursuant to the Credit Agreement, (b) all outstanding Risk
Participation Liability and (c) all other amounts due and payable under the
Credit Agreement and the other Credit Agreement Loan Documents.
Section 2. Termination of Credit Agreement Loan Documents. The Agent and
the Borrowers hereby acknowledge and agree that the Credit Agreement, the Notes
and the other Credit Agreement Loan Documents are hereby terminated in the
entirety, except to the extent that the provisions contained therein are by
their terms stated to survive such termination. Promptly following the execution
and delivery of this Agreement, the Agent agrees to deliver for cancellation to
Borrowers each of the Notes identified on Schedule II hereto, which are all of
the promissory notes outstanding under the Credit Agreement.
Section 3. Termination of Commitments. The Agent and the Borrowers
acknowledge and agree that the Revolving Loan Commitment and the Term Loan
Commitment have been permanently terminated.
Section 4. Termination of Certain Liens. (a) The Agent hereby irrevocably
terminates in the entirety all of its right, title and interest in, to and under
the assets, business, properties, contracts and rights of the Borrowers granted,
pledged, mortgaged, conveyed, transferred or set over to the Agent as collateral
security for the obligations of the Borrowers under the Credit Agreement Loan
Documents with the exception of any such property which constitutes collateral
for RBC's obligations to Xxxxxx under Section 2.13 of the Letter of Credit
Agreement;
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(b) The Agent hereby delivers to RBC the pledged securities and promissory
note identified on Schedule III hereto (and the related stock powers, as
applicable).
(c) the Agent hereby delivers to RBC the Uniform Commercial Code Form
UCC-3 termination statements identified on Schedule IV with respect to each
Uniform Commercial Code financing statement that was filed pursuant to the
documents identified on Schedule I hereto. The Agent authorizes the Borrowers
and their agents to file such Uniform Commercial Code Form UCC-3 termination
statements in the appropriate jurisdictions.
(d) The Agent hereby delivers to RBC the mortgage discharges or releases
with respect to each of the mortgages identified on Schedule I hereto that were
provided pursuant to the Credit Agreement Loan Documents. The Agent authorizes
the Borrowers to file such mortgage discharges or release agreements in the
appropriate jurisdictions.
(e) The Agent hereby delivers to RBC the release agreements with respect
to all intellectual property collateral security agreements identified on
Schedule I that were provided pursuant to the Credit Agreement Loan Documents.
The Agent authorizes the Borrowers and their agents to file such release
agreements with the U.S. Patent and Trademark Office and the U.S. Copyright
Office.
Section 5. Termination of Lender Letters of Credit. The Agent and the
Borrowers hereby acknowledge that no Lender Letters of Credit or Risk
Participation Agreements are issued and outstanding on the date hereof.
Section 6. Further Assurances. The Agent hereby agrees to execute and
deliver to or on behalf the Borrowers, at the expense of the Borrowers, such
other instruments, notices, releases or certificates as any of them may
reasonably request from time to time to more fully effectuate the foregoing
provision of this Agreement.
Section 7. Costs and Expenses. The Borrowers agree, jointly and severally,
to reimburse the Agent for all of its reasonable costs and expenses (including
the reasonable fees and reasonable expenses of legal counsel) incurred in
connection with the preparation, execution, delivery, filing, recordation and
administration of this Agreement and other documents and instruments to be
delivered pursuant hereto.
Section 8. Enhancement Letter of Credit Documents. Notwithstanding the
other terms of this Agreement, the Enhancement Letter of Credit Documents are,
and shall continue to be, in full force and effect in accordance with their
terms from and after the termination of the Credit Agreement Loan Documents.
Section 9. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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Section 10. Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which when executed and delivered will be
deemed to be an original and all of which counterparts of this Agreement taken
together will be deemed to be but one and the same instrument.
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IN WITNESS WHEREOF, the Agent and the Borrowers have caused this Agreement
to be duly executed by their respective duly authorized officers as of the date
and year first above written.
XXXXXX FINANCIAL, INC.,
individually and as Agent
By: /s/ Xxxxxx [ILLEGIBLE]
-------------------------------------
Name: Xxxxxx [ILLEGIBLE]
Title: AVP
ROLLER BEARING COMPANY OF
AMERICA, INC.
By: /s/ [ILLEGIBLE]
-------------------------------------
Name:
-----------------------------
Title:
----------------------------
INDUSTRIAL TECTONICS BEARING
CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------------
Name:
-----------------------------
Title:
----------------------------
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Schedule I
Security Documents
1. Holdings Guaranty dated March 31, 1992 by Roller Bearing Holding Company,
Inc. ("Holding") in favor of Xxxxxx Financial, Inc., as agent ("Agent").
2. Holdings Pledge Agreement dated March 31, 1992 by Holding in favor of
Agent.
3. Company Guaranty dated March 31, 1992 by Roller Bearing Company of
America, Inc. ("Company") in favor of Agent.
4. Company Security Agreement dated March 31, 1992 by Company in favor of
Agent.
5. Patent Security Agreement dated March 31, 1992 by Company in favor of
Agent.
6. Trademark Security Agreement dated March 31, 1992 by Company in favor of
Agent.
7. Company Pledge Agreement dated March 31, 1992 by Company in favor of
Agent.
8. Subsidiary Guaranty dated March 31, 1992 by Industrial Tectonics Bearing
Corporation ("ITBC") in favor of Agent.
9. Subsidiary Security Agreement dated March 31, 1992 by ITBC in favor of
Agent.
10. Patent Security Agreement dated March 31, 1992 by ITBC in favor of Agent.
11. Trademark Security Agreement dated March 31, 1992 by ITBC in favor of
Agent.
12. Subsidiary Guaranty dated October 26, 1992 by RBC Transport Dynamics
Corporation ("RBC") in favor of Agent.
13. Subsidiary Security Agreement dated October 26, 1992 by REC in favor of
Agent.
14. Copyright Security Agreement dated October 26, 1992 by RBC in favor of
Agent.
15. Trademark Security Agreement dated October 26, 1992 by RBC in favor of
Agent.
16. Patent Security Agreement dated October 26, 1992 by RBC in favor of Agent.
17. Mortgage, Assignment of Rents, Security Agreement, Financing Statement and
Fixture Filing dated March 31, 1992 by Company in favor of Agent
(Darlington County, South Carolina).
18. Assignment of Leases and Rents dated March 31, 1992 by Company in favor of
Agent Darlington County, South Carolina).
19. Deed of Trust, Assignment of Rents, Security Agreement, Financing
Statement and Fixture Filing dated March 31, 1992 by ITBC in favor of
Chicago Title Insurance Company, as Trustee for the benefit of Agent (Los
Angeles County, California).
20. Trademark Security Agreement dated August 12, 1993 by Company in favor of
Agent.
21. Patent Security Agreement dated August 12, 1993 by Company in favor of
Agent.
22. Open-End Mortgage Deed (Fee) dated June 28, 1996 by Company in favor of
Agent (Fairfield, Connecticut).
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23. Deed of Trust with Assignment of Rents dated February 20, 1996 by Company
in favor of Chicago Title Company, as Trustee for the benefit of Agent
(Santa Xxx - Orange County, California).
24. Collateral Assignment of Lessee's Interest in Lease dated October 30, 1996
by BPP Acquisition Corporation, Inc. in favor of Agent.
25. Pledge Agreement dated October 30, 1996 by Company in favor of Agent.
26. Continuing Subsidiary Guaranty dated October 30, 1996 by Company and BPP
Acquisition Corporation ("BPP").
27. Subsidiary Security Agreement dated October 30, 1996 by BPP in favor of
Agent.
28. Trademark Security Agreement dated October 30, 1996 by BPP in favor of
Agent.
29. Patent Security Agreement dated October 30, 1996 by BPP in favor of Agent.
30. Copyright Security Agreement dated October 30, 1996 by BPP in favor of
Agent.
31. Assignment of Lien Escrow Agreement dated October 30, 1996 by BPP, Company
and Agent.
32. Subsidiary Security Agreement dated February 27, 1997 by RBC Nice
Bearings, Inc. ("Nice") in favor of Agent.
33. Continuing Subsidiary Guaranty dated February 27, 1997 by Nice in favor of
Agent.
34. Pledge Agreement dated February 27, 1997 by Company in favor of Agent.
35. Collateral Assignment dated February 27, 1997 by Nice and Company in favor
of Agent.
36. Trademark Security Agreement dated February 27, 1997 by Nice in favor of
Agent.
37. Copyright Security Agreement dated February 27, 1997 by Nice in favor of
Agent.
38. Patent Security Agreement dated February 27, 1997 by Nice in favor of
Agent.
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Schedule II
Notes
Lender Loan Amount
------ ---- ------
Bank of Scotland Term A $ 3,428,571
Bank of Scotland Revolver 8,571,429
The First National Bank of Boston Term A 1,996,160
The First National Bank of Boston Term B 1,659,308
The First National Bank of Boston Revolver 4,990,399
National Westminster Bank, PLC Term A 1,996,160
National Westminster Bank, PLC Term B 1,659,308
National Westminster Bank, PLC Revolver 4,990,399
Union Bank Term A 1,857,143
Union Bank Revolver 4,642,857
Massachusetts Mutual Life Insurance Term A 1,250,000
Company
Massachusetts Mutual Life Insurance Term B 3,750,000
Company
Massachusetts Mutual Life Insurance Revolver 1,000,000
Company
Xxxxx Fargo Bank, N.A. Term A 1,996,160
Xxxxx Fargo Bank, N.A. Term B 1,659,308
Xxxxx Fargo Bank, N.A. Revolver 4,990,399
Xxxxxx Financial, Inc. Term A 2,225,806
Xxxxxx Financial, Inc. Term B 822,077
Xxxxxx Financial, Inc. Revolver 9,814,516
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Schedule III
Pledged Securities and Note
No. of
Issuer Holder Certificate Shares
------ ------ ----------- ------
Industrial Tectonics Bearings Corporation Roller Bearing Holding Company, 1 100
Inc.
Roller Bearing Company of America, Inc. Roller Bearing Holding Company, A-13 100
Inc.
RBC Transport Dynamics Corporation Roller Bearing Holding Company, 1 100
Inc.
BPP Acquisition Corporation Roller Bearing Holding Company, 1 10
Inc.
RBC Nice Bearing, Inc. Roller Bearing Holding Company, 1 10
Inc.
$3,435,662.50 Subordinated Promissory Note of Roller Bearing Company of America,
Inc. dated March 31, 1992 payable to the order of Industrial Tectonics Bearings
Corporation.
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Schedule IV
UCC Termination Statements
see attached schedule
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