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Wachovia Bank of North Carolina, N.A. <br />Post Office Box 1408 <br />Concord, NC 28026-1408 <br /> <br />September 3, 1992 <br /> <br />Water and Sewer District of Cabarrus County <br />65 Church Street, SW <br />Concord, NC 28025 <br />Attention: Blair Bennett, Finance Director <br /> <br />RE: Farmer's Home Administration Bond - Amendment to Commitment Letter <br /> dated June 2, 1988 <br /> <br />Dear Mr. Bennett: <br /> <br />On June 2, 1988, Wachovia Bank of North Carolina, N.A. (the "Bank"), formerly <br />known as Wachovia Bank and Trust Company, N.A., extended a commitment to <br />purchase $5,053,100.00 in principal amount of the bond (the "Bond") issued by <br />the Water and Sewer District of Cabarrus County, North Carolina (the "Issuer"). <br />The actual financing transaction between the Bank and the Issuer took place on <br />June 29, 1988. The Bond was a General Obligation bond of the Issuer and the <br />interest on which is taxable for purposes of Federal income taxation. The Bond <br />was issued in conjunction with the refinancing by the Issuer of certain <br />obligations of the Issuer held by the Farmer's Home Aaministration (FmHA). The <br />proceeds of the Bond were applied by the Issuer to redeem certain obligations of <br />the Issuer that were held by the FmHA. This co,~tment letter amends the <br />commitment letter dated June 2, 1988. <br /> <br />1) <br /> <br />Amount. The Bank agrees to continue financing the principal araount due as <br />of the writing of this commitment, that amount being $4,657,600.00. In <br />addition, the Bank agrees to increase the amount of principal by the cost <br />of issuance ($1,668.05), the interest penalty ($67,379.95) and the <br />prepayment penalty ($93,152.00). Therefore, the total amount being <br />financed will be $4,819,800.00. <br /> <br />2) <br /> <br />Interest Rate. The rate of interest will be 8.18% fixed for the 10-year <br />period starting October 1, 1992. Following the ten-year period, the rate <br />of interest will be the Bank's Prime Rate, presently 6%, subject to change <br />by the Bank from time to time. At no time during the variable rate pricing <br />which follows the initial 10 year fixed rate period can the variable rate <br />exceed the interest rate cap of 10.35%. The rate of interest will be <br />calculated on the basis of a 360-day year for the actual number of days in <br />each period. Interest shall be due and payable semi-annually in arrears in <br />June and December of each year. As used herein, the "Prime Rate" refers to <br />that interest rate so denominated and set by the Bank from time to time as <br />an interest rate basis for borrowings. The Prime Rate is one of several <br />interest rate bases used by the Bank. The Bank lends at interest rates <br />above and below the Prime Rate. <br /> <br />3) principal Repayment. The principal of the loan will be repaid in annual <br /> payments due on June 1 of each year. The amount of each payment shall be <br /> <br /> <br />