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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) MAY 22, 1997
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NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
TEXAS 33-43870 13-3641944
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(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification
Number)
51 Madison Avenue, Room 1700, New York, New York 10010
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 576-6456
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ITEM 5 - OTHER
On May 22, 1997, NYLIFE Structured Asset Management Company Ltd. ("SAMCO")
received a letter of credit ("LC") in the aggregate amount of $85,000,000
from The Chase Manhattan Bank. The LC was provided to SAMCO in accordance
with the provisions of the Consent, Assignment, Assumption, Amendment and
Modification Agreement dated December 30, 1996 (the "Agreement") by and
between SAMCO, Westinghouse Electric Corporation, WestSec, Inc. and Westar
Capital, Inc.
In addition, SAMCO and WestSec Inc. entered into a letter agreement dated
May 21, 1997 memorializing certain collateral agreements and understandings
related to the LC.
ITEM 7 - FINANCIAL STATEMENT, PRO FORMA
FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
1. Letter of Credit No. P-271117 dated May 22, 1997 issued by
The Chase Manhattan Bank (NYLIFE Structured Asset Management
Company Ltd. as Beneficiary and WestSec, Inc. as Applicant).
2. Letter agreement dated May 21, 1997 between NYLIFE
Structured Asset Management Company Ltd. and WestSec, Inc.
relating to Letter of Credit No. P-271117 dated May 22,
1997.
1
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NYLIFE Structured Asset Management Company Ltd
Date: June 5, 1997
By: /s/ Kevin M. Micucci
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Kevin M. Micucci
President (Principal Executive,
Financial and Accounting Officer)
2
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ISSUE DATE: MAY 22, 1997
LIC NO: P-271117
THE "BENEFICIARY" THE "APPLICANT"
NYLIFE STRUCTURED ASSET MANAGEMENT WESTSEC, INC.
COMPANY LTD. ("SAMCO") TELEFAX NO. 913-575-1930
TELEFAX NO. 212-447-4127 ATTN: E. LYNN COOK
ATTN: SCOTT DRATH 816 KANSAS AVENUE
51 MADISON AVENUE, SUITE 1710 TOPEKA, KANSAS 66612
NEW YORK, NEW YORK 10010
IN RELATION TO THAT CERTAIN CONSENT, ASSIGNMENT, ASSUMPTION, AMENDMENT AND
MODIFICATION AGREEMENT, DATED AS OF DECEMBER 30, 1996, BETWEEN SAMCO,
WESTINGHOUSE ELECTRIC CORPORATION ("WEC"); WESTSEC, INC. ("WESTSEC"), AND WESTAR
CAPITAL, INC. ("WESTAR") ("ASSIGNMENT AGREEMENT"), THE CHASE MANHATTAN BANK, 56
WATER STREET, NEW YORK NY 10041 ("BANK"), HEREBY ESTABLISHES THIS IRREVOCABLE
LETTER OF CREDIT NO. P-271117 AT THE REQUEST OF THE APPLICANT IN FAVOR OF THE
BENEFICIARY FOR AN INITIAL AGGREGATE AMOUNT UP TO U.S. $85,000,000 (EIGHTY-FIVE
MILLION UNITED STATES DOLLARS) SUBJECT TO REDUCTION AS DESCRIBED HEREIN.
THIS LETTER OF CREDIT IS EFFECTIVE AS OF APRIL 1ST, 1997 ("EFFECTIVE DATE")
AND EXPIRES AT THE BANK'S COUNTERS IN NEW YORK WITH THE BANK'S CLOSE OF BUSINESS
ON DECEMBER 1ST, 1997 (THE "EXPIRATION DATE").
THIS LETTER OF CREDIT SHALL TERMINATE PRIOR TO THE EXPIRATION DATE UPON THE
BUSINESS DAY FOLLOWING THE DAY, IF ANY, UPON WHICH THE APPLICANT AND THE
BENEFICIARY JOINTLY NOTIFY THE BANK THAT APPLICANT AND BENEFICIARY ELECT TO
TERMINATE THIS LETTER OF CREDIT BY PRESENTATION TO BANK OF A LETTER SIMILAR TO
THE FORM ATTACHED HERETO AS "ATTACHMENT A".
THIS LETTER OF CREDIT SHALL TERMINATE UPON APPLICANT'S NOTICE TO BANK AND
BENEFICIARY BOTH SPECIFYING A TERMINATION DATE AND THAT APPLICANT WILL ENTER
INTO ANOTHER LETTER OF CREDIT IN FAVOR OF BENEFICIARY DRAWN ON A BANK RATED NOT
LESS THAN "AA" WITH TERMS THAT ARE THE SAME IN ALL MATERIAL RESPECTS AS THOSE
SET FORTH IN THIS LETTER OF CREDIT EXCEPT FOR THE NEW EXPIRATION DATE AND
PROVIDING FOR AN AGGREGATE AMOUNT NOT LESS THAN THE AGGREGATE AMOUNT OF THIS
LETTER OF CREDIT ON THE ELECTED TERMINATION DATE, PROVIDED SUCH NOTICE IS GIVEN
AT LEAST 15 (FIFTEEN) DAYS PRIOR TO SUCH SPECIFIED TERMINATION DATE.
FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO BENEFICIARY AGAINST ITS
DRAFT OR DRAFTS DRAWN ON THE CHASE MANHATTAN BANK, 55 WATER STREET NEW YORK NY
10041 ATTN: STANDBY LETTER OF CREDIT DEPARTMENT, ROOM 1708. TELEPHONE
212-638-3398 FAX 212-363-5656 ON ANY BUSINESS DAY, SUBMITTED TO THE BANK AT
SIGHT ON OR BEFORE THE EXPIRATION DATE, SETTING FORTH THEREON THE LETTER OF
CREDIT NUMBER P-271117 TOGETHER WITH A WRITTEN CERTIFICATE PURPORTEDLY SIGNED BY
THE BENEFICIARY'S DULY AUTHORIZED REPRESENTATIVE STATING EITHER:
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(A) "NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD. ("SAMCO") HEREBY
CERTIFIES THAT IT (I) MADE DEMAND AGAINST WESTAR CAPITAL, INC. ("WESTAR")
AND/OR WESTSEC, INC. ("WESTSEC"), ON [INSERT DATE] TO ENFORCE SAMCO'S
RIGHTS UNDER THE CONSENT, ASSIGNMENT, ASSUMPTION, AMENDMENT AND
MODIFICATION AGREEMENT, DATED AS OF DECEMBER 30, 1996, BETWEEEN SAMCO,
WESTINGHOUSE ELECTRIC CORPORATION ("WEC"), WESTSEC AND WESTAR ("ASSIGNMENT
GREEMENT"), (II) WESTSEC AND/OR WESTAR DID NOT SATISFY SUCH DEMAND IN FULL
BY 5:00 P.M. CENTRAL TIME ON [INSERT DATE], THE BUSINESS DAY FOLLOWING THE
DATE ON WHICH THE DEMAND WAS RECEIVED BY WESTSEC AND/OR WESTAR, (iii)
THIS CERTIFICATE HAS BEEN DULY AUTHORIZED, EXECUTED AND DELIVERED BY OR ON
BEHALF OF SAMCO, AND (IV) A TRUE AND COMPLETE COPY OF THIS CERTIFICATE HAS
BEEN DELIVERED BY OR ON BEHALF OF SAMCO TO WESTSEC."
OR
(B) "AS OF THE DATE OF THIS STATEMENT, WHICH DATE IS NO EARLIER THAN 5
(FIVE) BUSINESS DAYS PRIOR TO THE EXPIRATION OR EARLIER TERMINATION OF
LETTER OF CREDIT NO. P-271117 ISSUED IN FAVOR OR NYLIFE STRUCTURED ASSET
MANAGEMENT COMPANY, LTD. ("SAMCO"), WESTSEC, INC. HAS NOT PROVIDED TO SAMCO
EITHER (I) ANOTHER LETTER OF CREDIT IN FAVOR OF SAMCO DRAWN ON A BANK RATED
NOT LESS THAN "AA" WITH TERMS THAT ARE THE SAME IN ALL MATERIAL RESPECTS AS
THOSE IN LETTER OF CREDIT NO. P-271117 AS OF THE DATE HEREOF EXCEPT FOR THE
NEW EXPIRATION DATE OR (II) AN AMENDMENT TO LETTER OF CREDIT NO. P-271117
EXTENDING THE EXPIRATION DATE THEREOF. THE AMOUNT DRAWN HEREUNDER
REPRESENTS THE AGGREGATE AMOUNT AVAILABLE UNDER LETTER OF CREDIT
NO. P-271117 AS OF THE DATE HEREOF IN ACCORDANCE WITH THE TERMS THEREOF.
SUBJECT TO THE AGGREGATE AMOUNT AVAILABLE UNDER THIS LETTER OF CREDIT FROM
TIME TO TIME, BENEFICIARY SHALL BE PERMITTED TO MAKE PARTIAL DRAWINGS AND
MULTIPLE DRAWINGS HEREUNDER AND ALL PAYMENTS BY THE BANK TO THE BENEFICIARY
HEREUNDER WILL BE MADE IN IMMEDIATELY AVAILABLE FUNDS.
THE AMOUNT OF THIS LETTER OF CREDIT SHALL BE REDUCED AUTOMATICALLY FROM
TIME TO TIME AFTER THE DATE HEREOF UPON THE PRESENTATION TO BANK OF A WRITTEN
REQUEST PURPORTEDLY SIGNED BY THE APPLICANT'S AND THE BENEFICIARY'S RESPECTIVE
DULY AUTHORIZED REPRESENTATIVES STATING:
"PURSUANT TO THE TERMS OF THAT CERTAIN LETTER OF CREDIT P-271117 BETWEEN
WESTSEC INC. ("APPLICANT"), THE CHASE MANHATTAN BANK ("BANK"), AND NYLIFE
STRUCTURED ASSET MANAGEMENT COMPANY LTD. ("SAMCO"), WITH AN EFFECTIVE DATE OF
APRIL 1ST, 1997, ("LETTER OF CREDIT"), APPLICANT AND SAMCO HEREBY JOINTLY
REQUEST THAT THE AMOUNT OF THE LETTER OF CREDIT BE REDUCED TO [INSERT DOLLAR
FIGURE] (----------------DOLLARS), WHICH AMOUNT REPRESENTS AN AMOUNT EQUAL TO
$85,000,0000 (EIGHTY-FIVE MILLION DOLLARS) LESS THE SUM OF (1) AN AMOUNT EQUAL
TO ALL DRAWINGS BY BENEFICIARY UNDER THE LETTER OF CREDIT AND (2) AN AMOUNT
EQUAL TO THE QUOTIENT RESULTING FROM DIVIDING THE AGGREGATE AMOUNT OF ANY
PAYMENTS MADE AFTER DECEMBER 31, 1996 TO SAMCO MADE PURSUANT TO THE OPERATIONAL
SERVICES AGREEMENT BETWEEN SAMCO AND APPLICANT, AS ASSIGNEE OF WESTINGHOUSE
ELECTRIC CORPORATION, DATED AS OF NOVEMBER 15, 1991 (SUCH AGREEMENT THE "OSA")
WHICH PAYMENTS ARE REQUIRED TO BE APPLIED TO REPAYMENT OF PRINCIPAL UNDER
OUTSTANDING PUBLIC DEBT OBLIGATIONS OF SAMCO
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PURSUANT TO THE TERMS OF THE OSA OR ANY DEBT OBLIGATION OF SAMCO, BY 61.133%
(SIXTY-ONE AND ONE HUNDRED THIRTY-THREE ONE THOUSANDTHS PERCENT)."
ALL NOTICES TO OR FROM THE APPLICANT OR BENEFICIARY UNDER THIS LETTER OF
CREDIT SHALL BE MADE IN WRITING AND SENT BY REGISTERED MAIL, TELETRANSMISSION OR
HAND DELIVERY TO THE ABOVE INDICATED ADDRESSES (OR SUCH OTHER ADDRESS(ES) AS
APPLICANT OR BENEFICIARY AS THE CASE MAY BE, MAY SPECIFY FROM TIME TO TIME BY
WRITTEN NOTICE DELIVERED TO THE BANK AND, AS THE CASE MAY BE, EITHER THE
APPLICANT OR THE BENEFICIARY BY REGISTERED MAIL, TELETRANSMISSION OR HAND
DELIVERY AT THE ABOVE INDICATED ADDRESS)
ALL CORRESPONDENCE AND ANY DRAWINGS PRESENTED IN CONNECTION WITH THIS
LETTER OF CREDIT MUST ONLY BE PRESENTED TO THE CHASE MANHATTAN BANK, 55 WATER
STREET, 17TH FLOOR, ROOM 1706, NEW YORK, NEW YORK 10041, ATTENTION: STANDBY
LETTER OF CREDIT DEPARTMENT, CUSTOMER INQUIRY NUMBERS ARE (212) 638-3473 AND
(212) 638-3321.
THE BANK HEREBY ISSUES THIS DOCUMENTARY CREDIT IN THE BENEFICIARY'S FAVOR.
THE BANK HEREBY AGREES WITH THE BENEFICIARY THAT EACH DRAFT DRAWN UNDER AND IN
COMPLIANCE WITH THE TERMS OF THIS LETTER OF CREDIT WILL BE PROMPTLY HONORED UPON
PRESENTATION. EXCEPT AS OTHERWISE PROVIDED IN THIS LETTER OF CREDIT, IT IS
SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993
REVISION, INTERNATIONAL CHAMBER OF COMMERCE, PARIS, FRANCE PUBLICATION NO. 500)
AND ENGAGES US IN ACCORDANCE WITH THE TERMS THEREOF.
THE NUMBER AND THE DATE OF THE BANK'S CREDIT AND THE NAME OF THE BANK MUST
BE QUOTED ON ALL DRAFTS REQUIRED.
YOURS TRULY,
THE CHASE MANHATTAN BANK
/s/ V. Marinaccio
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AUTHORIZED SIGNATURE
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ATTACHMENT A TO LETTER OF CREDIT
NUMBER P-271117
TERMINATION CERTIFICATE
TO:
THE CHASE MANHATTAN BANK
55 WATER STREET
17TH FLOOR, ROOM 1706
NEW YORK, NEW YORK 10041
ATTENTION: VICTOR MARINACCIO, A.V.P. OR KRISTINE SIEBEL, A.V.P.
STANDBY LETTER OF CREDIT DEPARTMENT
RE: THE CHASE MANHATTAN BANK LETTER OF CREDIT NUMBER P-271117
GENTLEMEN:
THE UNDERSIGNED BEING AUTHORIZED REPRESENTATIVES OF NYLIFE STRUCTURED ASSET
MANAGEMENT COMPANY LTD. ("BENEFICIARY") AND WESTSEC, INC. ("APPLICANT") DO
HEREBY ELECT TO TERMINATE THE ABOVE REFERENCED LETTER OF CREDIT, EFFECTIVE
IMMEDIATELY.
IN WITNESS WHEREOF THE UNDERSIGNED HAVE EXECUTED AND DELIVERED THIS
CERTIFICATE AS OF THE ______________ DAY OF _____________, 199__.
WESTSEC, INC.
BY:
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NAME:
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TITLE:
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NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
BY:
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NAME:
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TITLE:
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NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
51 MADISON AVENUE - ROOM 1700
NEW YORK, NEW YORK 10010
May 21, 1997
WestSec Inc.,
818 Kansas Avenue,
Topeka, Kansas 66612
Dear Sir/Madam:
This letter memorializes certain collateral agreements and understandings
between NYLIFE Structured Asset Management Company Ltd. ("SAMCO"), as
Beneficiary, and WestSec Inc. ("WestSec"), as Applicant, under that certain
Letter of Credit No. P-271117, issued on May 22, 1997, by The Chase Manhattan
Bank (the "Bank") or any amendment, extension or replacement thereof (the
"Letter of Credit").
REDUCTION OF LETTER OF CREDIT AMOUNT
The Letter of Credit provides for the reduction from time to time, upon the
joint request of SAMCO and WestSec to the Bank, of the amount of the Letter
of Credit to an amount equal to $85,000,000 less the sum of (1) an amount equal
to all drawings by SAMCO under the Letter of Credit and (2) an amount equal to
the quotient resulting from dividing the aggregate amount of any payments after
December 31, 1996 to SAMCO made pursuant to the Operational Services Agreement
between SAMCO and WestSec, as assignee of Westinghouse Electric Corporation,
dated as of November 15, 1991 (the "OSA"), which payments are required to be
applied by SAMCO to repayment of principal under outstanding public debt
obligations of SAMCO pursuant to the terms of the OSA or any debt obligation of
SAMCO (each a "Payment"), by 61.133%.
In connection with the Letter of Credit, SAMCO hereby agrees to provide
notice to WestSec to the address
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WestSec Inc. -2-
specified in the Letter of Credit within (i) five (5) business days after any
drawing under the Letter of Credit by SAMCO and (ii) within five (5) business
days after the end of any calendar quarter in which any Payment is made, which
notice shall state the date and amount of such drawing or Payment, as the case
may be. Simultaneous with delivery of any notice required by the foregoing
sentence, SAMCO shall deliver to WestSec a joint request of SAMCO and WestSec,
duly executed on behalf of SAMCO, directing the Bank to reduce the amount of the
Letter of Credit in connection with the applicable drawing or Payment, as the
case may be, to the amount specified by the formula set forth in the Letter of
Credit.
SAMCO hereby further agrees that, upon demand by WestSec, SAMCO shall
immediately reimburse WestSec in full for any commitment fees or other fees and
expenses incurred by WestSec under the Letter of Credit as a result of the
failure by SAMCO to deliver to WestSec in accordance with the deadlines
specified above a true and accurate notice and a joint request duly executed by
SAMCO as required in connection with any drawing or Payment.
FUNDS HELD IN TRUST
The Letter of Credit provides, among other things, that SAMCO may draw down
the aggregate amount available under the Letter of Credit not earlier than five
(5) business days prior to the expiration or earlier termination of the Letter
of Credit if WestSec has not provided to SAMCO either (i) another letter of
credit in favor of SAMCO drawn on a bank rated not less than "AA" with terms
that are the same in all material respects as those in the Letter of Credit
except for the new expiration date or (ii) an amendment to the Letter of Credit
extending the expiration date thereof.
SAMCO hereby acknowledges and agrees that any funds drawn down by SAMCO
pursuant to the immediately preceding paragraph ("Funds") shall be held by
SAMCO, and such agents as SAMCO shall appoint, in trust for the sole benefit of
WestSec except as otherwise specifically provided herein. Without limitation of
the foregoing, SAMCO shall as soon as practicable after receipt of such Funds
deposit all such Funds into an interest bearing demand account with a commercial
bank rated not less than "AA". SAMCO shall not, and shall not authorize or
permit any other person to, withdraw, expend, convert or otherwise deplete or
encumber any of such Funds; PROVIDED, HOWEVER, that SAMCO shall be permitted to
draw down
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WestSec Inc. -3-
on such Funds in such amount, at such times and under such conditions as SAMCO
would have been permitted to draw down funds under the Letter of Credit (other
than a draw down solely in respect of the failure of WestSec at least five (5)
business days prior to the expiration or earlier termination of the Letter of
Credit to provide SAMCO with either (i) another letter of credit in favor of
SAMCO drawn on a bank rated not less than "AA" with terms that are the same in
all materials respects as those in the Letter of Credit except for the new
expiration date or (ii) an amendment to the Letter of Credit extending the
expiration date thereof).
SAMCO shall cause all such Funds and all interest thereon, less any portion
of such Funds properly drawn down by SAMCO pursuant to the proviso contained in
the foregoing paragraph, to be repaid to WestSec upon the earlier of (i) the
provision by WestSec to SAMCO of another letter of credit in favor of SAMCO
drawn on a bank rated not less than "AA" with terms that are the same in all
material respects as those in the Letter of Credit except for the new expiration
date, (ii) the provision by WestSec to SAMCO of an amendment to the Letter of
Credit extending the expiration date thereof and (iii) September 14, 1999.
SAMCO shall not be liable to or otherwise be required to indemnify WestSec
with respect to the waste, misuse, misappropriation or other loss of all or any
portion of the Funds by the commercial bank with which such Funds are deposited
or any other person acting on behalf of such commercial bank. WestSec shall
reimburse and indemnify SAMCO for any out-of-pocket fees or expenses including,
without limitation, wire transfer fees, bank fees and charges and reasonable
attorneys' fees, incurred in connection with the draw down of Funds under the
Letter of Credit and/or repayment thereof to WestSec in the circumstances
contemplated in this letter agreement.
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WestSec Inc. -4-
This letter shall be governed by the laws of the State of New York without
regard to conflicts-of-law principles thereof.
Sincerely,
NYLIFE Structured Asset
Management Company Ltd.
Acknowledged: By: /s/ Scott Drath
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Name: Scott Drath
WestSec, Inc. Title: Vice President
By: /s/ Steven A. Millstein
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Name: Steven A. Millstein
Title: President
