Fleet National Bank Credit Facilities Letter Agreement with The Talbots, Inc. (March 6, 2001)
Fleet National Bank confirms it is making available to The Talbots, Inc. several uncommitted, discretionary credit facilities, including a $100 million line for letters of credit, a $5 million money market line for short-term loans, and a $10 million foreign exchange line. These facilities are available until March 6, 2002, and are subject to specific terms, fees, and documentation requirements. The agreement is not a binding commitment to lend, and all borrowings must be repaid with interest by their maturity dates. Early repayment may incur additional costs.
The Talbots, Inc. March 6, 2001
175 Beal Street
Hingham, MA 02043
| Attention: | Mr. Edward L. Larsen Senior Vice President, Finance Chief Financial Officer and Treasurer |
Dear Ed:
This letter will serve to confirm that Fleet National Bank (the “Bank”) holds available for The Talbots, Inc. (the “Company”) uncommitted, discretionary credit facilities as follows:
| (a) | an aggregate $100,000,000.00 line of credit for the issuance of documentary letters of credit to support the importation of goods into the United States from Hong Kong and other Asian countries, and the issuance of one-year standby letters of credit; |
| (b) | an aggregate $5,000,000 money market line of credit for discretionary advances; and |
| (c) | a $10,000,000 foreign exchange line for spot and 12-month forward contracts. |
All such facilities shall expire on March 6, 2002, and documentary letters of credit will be payable at sight and shall be priced as follows based on the location of the issuance:
| Boston | Hong Kong |
| Issuing Fee: | U.S. $25* | Waived |
| Negotiation Fee: | The greater of 1/8% or U.S. $70 | Waived |
| Amendment Fee: | U.S. $25* | Waived |
| *Plus Cable Fee: |
Each documentary letter of credit issued under this facility will be governed additionally by a continuing Commercial Letter of Credit Agreement, and a Master Trade Key Agreement between the Company and the Bank, and such other documentation that the Bank may require from time to time.
The standby letter of credit issued under this facility will be governed by our existing Standby Letter of Credit Agreement and such other documentation that the Bank may require from time to time.
Each money market advance under this facility will be at fixed rates quoted by Fleet National Bank with maturities of up to 180 days, and no loan shall have an interest period that extends beyond the expiration of this line of credit. Each loan must be at least $1,000,000.00 and aggregate loans under this arrangement may not exceed $5,000,000.00. This arrangement is not a commitment to lend, and from time to time the Bank may not quote rates on some or all maturities.
We agree that upon your advice by telephone to our Money Market Desk that you wish to borrow money under this facility and our agreement to lend, we will forthwith lend you such amount at the quoted rate of interest by crediting such amount to your demand deposit account with us, or, upon your instructions, by wiring such amount to such other account as you may direct. Borrowings will be evidenced by a Promissory Note in the form attached hereto. Each borrowing and the corresponding information (see attached note schedule) will be recorded the day of the telephone call. Our advices of credit and debit will be additional evidence of borrowings. You authorize us to keep the official record of all borrowings under this “money market” lending arrangement in the format described above, and you agree that this record shall be prima facie evidence of the amount of the borrowings under this facility.
No voluntary prepayment of money market loans will be permitted. If any money loans are paid on a date other than the last day of the applicable interest period (whether by reason of voluntary prepayment, acceleration or otherwise), the Company shall compensate the Bank for any funding losses and other costs (including lost profits) incurred as a result of such prepayment.
This letter and the Promissory Note evidence your promise to pay all such borrowings with interest on their respective maturity dates. This “money market” lending arrangement remains in force until March 6, 2002.
If the foregoing satisfactorily sets forth the terms and conditions of our lines of credit, please execute and return this letter. We are pleased to provide these lines to Talbots, and look forward to the ongoing development of our relationship.
Sincerely, Fleet National Bank By: PETER L. GRISWOLD ______________________________________ Peter L. Griswold, Managing Director Retail & Apparel Division Accepted: The Talbots, Inc. By: EDWARD L. LARSEN _____________________________________ Edward L. Larsen Senior Vice President, Finance Chief Financial Officer and Treasurer Date: __________________
