<PAGE> 1
EXHIBIT 4.2
INDENTURE OF TRUST
by and between
FIRST-CITIZENS BANK & TRUST COMPANY,
as Trustee
and
IOWA FINANCE AUTHORITY
Dated as of March 1, 1995
Relating to the Issuance of
$3,000,000 TAX-EXEMPT ADJUSTABLE MODE
INDUSTRIAL DEVELOPMENT REVENUE BONDS
(DIXIE BEDDING COMPANY PROJECT)
SERIES 1995
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
ARTICLE I
DEFINITIONS
ARTICLE II
THE BONDS
<S> <C>
Section 2.1. Authorized Amount of Bonds 17
Section 2.2. Issuance of Bonds 17
Section 2.3. Interest Rates on Bonds 18
Section 2.4. Conversion of Interest Rate Determination Method 23
Section 2.5. Issuance of a Credit Facility 26
Section 2.6. Tender of Bonds for Purchase 28
Section 2.7. Remarketing of Bonds 31
Section 2.8. Delivery of Purchased Bonds 33
Section 2.9. Execution; Limited Obligation 34
Section 2.10.Certificate of Authentication 35
Section 2.11.Form of Bonds 35
Section 2.12.Delivery of Bonds 35
Section 2.13.Mutilated, Lost, Stolen or Destroyed Bonds 37
Section 2.14.Exchangeability and Transfer of Bonds; Persons
Treated as Owners 37
Section 2.15.Replacement Bonds 38
Section 2.16.Cancellation 38
Section 2.17.Ratably Secured 39
Section 2.18.Redemption of Bonds; Partial Redemption of Bonds 39
Section 2.19.Notice of Redemption 43
Section 2.20.Book Entry System 43
ARTICLE III
SECURITY
Section 3.1. Security 45
Section 3.2. Payment of Bonds and Performance of Covenants 46
Section 3.3. Authority 46
Section 3.4. No Litigation 46
Section 3.5. Further Assurances 47
Section 3.6. No Other Encumbrances 47
Section 3.7. No Personal Liability 47
Section 3.8. Credit Facility 47
</TABLE>
<PAGE> 3
<TABLE>
ARTICLE IV
FUNDS
<S> <C>
Section 4.1. Establishment and Use of Bond Fund and Current Account 50
Section 4.2. Establishment and Use of Initial Fund 52
Section 4.3. Establishment and Use of Surplus Fund 52
Section 4.4. Establishment and Use of Bond Purchase Fund 52
Section 4.5. Deposit of Bond Proceeds 53
Section 4.6. Records 54
Section 4.7. Investment of Initial Fund, Surplus Fund, Bond Fund
and Bond Purchase Fund Moneys 54
Section 4.8. Arbitrage; Arbitrage Rebate Fund 55
Section 4.9. Non-presentment of Bonds 56
ARTICLE V
DISCHARGE OF LIEN
Section 5.1. Discharge of Lien and Security Interest 56
Section 5.2. Provision for Payment of Bonds 57
Section 5.3. Discharge of this Indenture 58
ARTICLE VI
DEFAULT PROVISIONS AND REMEDIES
Section 6.1. Events of Default 58
Section 6.2. Acceleration 59
Section 6.3. Other Remedies; Rights of Holders 60
Section 6.4. Right of Holders and Credit Issuer to Direct Proceedings 60
Section 6.5. Discontinuance of Default Proceedings 61
Section 6.6. Waiver 61
Section 6.7. Application of Moneys 62
Section 6.8. Rights of a Credit Issuer 63
ARTICLE VII
THE TRUSTEE; THE PAYING AGENT; THE TENDER AGENT;
THE REGISTRAR; THE REMARKETING AGENT
Section 7.1. Appointment of Trustee 63
Section 7.2. Compensation and Indemnification of Trustee,
Paying Agent, Tender Agent and Registrar;
Trustee's Prior Claim 66
Section 7.3. Intervention in Litigation 67
Section 7.4. Resignation 67
Section 7.5. Removal of Trustee 68
Section 7.6. Paying Agent 68
Section 7.7. Tender Agent 69
Section 7.8. Qualifications of Paying Agent and Tender Agent;
Resignation; Removal 70
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
Section 7.9. Instruments of Holders 71
Section 7.10.Power to Appoint Co-Trustees 71
Section 7.11.Filing of Financing Statements 73
Section 7.12.Remarketing Agent 74
Section 7.13.Qualifications of Remarketing Agent; Resignation; Removal 74
Section 7.14.Several Capacities 75
Section 7.15.Trustee Not Responsible for Duties of Remarketing Agent,
Tender Agent, Registrar and Paying Agent 75
Section 7.16.Cooperation of the Issuer 75
Section 7.17.Cooperation of the Trustee, the Tender Agent, the
Registrar and the Paying Agent 75
ARTICLE VIII
AMENDMENTS, SUPPLEMENTAL INDENTURES
Section 8.1. Supplemental Indentures 75
Section 8.2. Amendments to Indenture; Consent of Holders, the Credit
Issuer and the Company 77
Section 8.3. Amendments to the Agreement Not Requiring Consent of
Holders 78
Section 8.4. Amendments to the Agreement Requiring Consent of Holders
and the Credit Issuer 78
Section 8.5. Amendments, Changes and Modifications to the
Credit Facility 79
Section 8.6. Notice to and Consent of Holders 79
ARTICLE IX
MISCELLANEOUS
Section 9.1. Right of Trustee to Pay Taxes and Other Charges 79
Section 9.2. Limitation of Rights 80
Section 9.3. Severability 80
Section 9.4. Notices 80
Section 9.5. Payments Due on Non-Business Days 82
Section 9.6. Binding Effect 82
Section 9.7. Captions 82
Section 9.8. Governing Law 82
Section 9.9. Limited Liability of Issuer 82
Section 9.10.Notices to Rating Agency 82
Section 9.11.Execution in Counterparts 83
Signatures 84
Acknowledgments 85
</TABLE>
EXHIBIT A Form of Bond
EXHIBIT B Form of Conversion Notice
EXHIBIT C Form of Notice of Credit Facility
EXHIBIT D Form of Notice of Credit Modification Date
<PAGE> 5
INDENTURE OF TRUST
THIS INDENTURE OF TRUST (the "Indenture") dated as of the 1st day
of March, 1995, by and between the IOWA FINANCE AUTHORITY, a public
instrumentality and agency of the State of Iowa organized and existing under
Chapter 16 of the Code of Iowa (1995) (the "Issuer"), and FIRST-CITIZENS BANK &
TRUST COMPANY, as trustee, and its successors in trust and assignees (the
"Trustee").
W I T N E S S E T H:
WHEREAS, the Issuer is authorized and empowered by the provisions
of Chapter 16 of the Code of Iowa (1995), as amended (the "Act"), to issue and
sell its revenue bonds for the purpose of financing in whole or in part the cost
of a "project" (as defined in Section 16.102 of the Act) for the purpose of
assisting economic development and the expansion of business, industry and
farming in the State; and
WHEREAS, the Act provides that the Issuer may issue and sell its
revenue bonds for the purpose of acquiring, constructing, improving and
equipping any such project payable solely out of the revenues derived from the
project to be financed by the bonds so issued; and
WHEREAS, pursuant to and in accordance with the provisions of the
Act, by Resolution of its board, the Issuer has authorized and undertaken to
issue its Tax-Exempt Adjustable Mode Industrial Development Revenue Bonds (Dixie
Bedding Company Project) Series 1995 (the "Bonds") to provide funds to pay a
portion of the costs of acquiring, constructing, improving and equipping a
mattress manufacturing facility in Clear Lake, Iowa (the "Project") to be owned
and operated by Dixie Bedding Company, a North Carolina corporation (the
"Company"); and
WHEREAS, the Issuer has undertaken to issue and sell the Bonds and
to loan the proceeds from the sale of the Bonds so as to enable the Company to
acquire, construct, improve and equip the Project, and Company has agreed to
make payments required herein sufficient to pay the principal of and premium, if
any, and interest on the Bonds and related expenses.
NOW, THEREFORE, in consideration of the premises and of the
covenants and undertakings herein expressed, the parties hereto agree as
follows:
-1-
<PAGE> 6
ARTICLE I
DEFINITIONS
All terms defined in the Agreement and not defined herein shall
have the meaning ascribed thereto in the Agreement. In addition to terms
elsewhere defined in this Indenture, the following words and terms as used in
this Indenture and the preambles hereto shall have the following meanings unless
the context or use clearly indicates another or different meaning or intent and
such definitions shall be equally applicable to both the singular and plural
forms of the terms and words herein defined:
"Act" means Chapter 16 of the Code of Iowa (1995), as amended from
time to time.
"Act of Bankruptcy" means any of the following events:
(i) The Company (or any other Person obligated, as guarantor or
otherwise, to make payments on the Bonds or under the Agreement or the Credit
Agreement or an "insider" with respect to the Company within the meaning of
Title 11 of the United States Code, as amended) or the Issuer shall (a) apply
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee, liquidator or the like of the Company (or such
other Person or "insider") or the Issuer or of all or any substantial part of
its property, (b) commence a voluntary case under the United States Bankruptcy
Code (as now or hereafter in effect), or (c) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency, reorganization,
winding-up or composition or adjustment of debts; or
(ii) A proceeding or case shall be commenced, without the
application or consent of the Company (or any other Person obligated, as
guarantor or otherwise, to make payments on the Bonds or under the Agreement or
the Credit Agreement or an "insider" with respect to the Company within the
meaning of Title 11 of the United States Code, as amended) or the Issuer in any
court of competent jurisdiction, seeking (a) the liquidation, reorganization,
dissolution, winding-up, or composition or adjustment of debts, of the Company
or the Issuer (or any such other Person or "insider"), (b) the appointment of a
trustee, receiver, custodian, liquidator or the like of the Company or the
Issuer (or any such other Person or "insider") or of all or any substantial part
of its respective property, or (c) similar relief in respect of the Company or
the Issuer (or any such other Person or "insider") under any law relating to
bankruptcy, insolvency, reorganization, winding-up or composition or adjustment
of debts.
"Agreement" means the Loan Agreement dated as of March 1, 1995
between the Issuer and the Company, and any amendments and supplements thereto.
-2-
<PAGE> 7
"Alternate Credit Facility" means any credit facility delivered in
substitution for the Credit Facility delivered to, and accepted by, the Trustee
pursuant to Section 3.8(e).
"Alternate Medium-Term Index" means the rate of interest per annum
determined by the Remarketing Agent to be equal to 105% of the then current
yield on United States Treasury obligations that have a remaining term
approximately equal to the remaining term of the applicable Medium-Term Rate
Period; provided that, if interest on the Bonds is an item of tax preference in
determining alternative minimum taxable income under the Code, the rate of
interest per annum shall equal 105.40% of the then current yield on such United
States Treasury obligations.
"Alternate Monthly Index" means the index rate selected by the
Remarketing Agent that is a composite of current bid-side yields of obligations
that are comparable as to credit and of the same general nature as the Bonds (i)
that provide for a monthly adjustment of the interest rate, (ii) that (A) must
be purchased on demand of the owner thereof at any time upon notice of up to
thirty (30) days or (B) are payable in full no later than thirty (30) days after
the date of evaluation and (iii) the interest on which is excluded from gross
income for federal income tax purposes; provided that, if such index rate shall
not be established, the Alternate Monthly Index shall be the sum of (i) the
product of (A) the interest rate for thirty-day taxable commercial paper (prime
paper placed through dealers) announced for the first day of each Interest
Period during a Monthly Rate Period (or, if such day is not a Business Day, the
immediately preceding Business Day) by the Federal Reserve Bank of New York,
converted to a coupon equivalent rate, multiplied by (B) 1 minus the lesser of
(1) the maximum federal income tax rate payable by corporations at the time on
interest income and (2) the maximum federal income tax rate payable by
individuals at the time on interest income, plus (ii) 2.50% or, if interest on
the Bonds is an item of tax preference in determining alternative minimum
taxable income under the Code, 2.90%.
"Alternate Semiannual Index" means the index rate selected by the
Remarketing Agent that is a composite of current bid-side yields of obligations
that are comparable as to credit and of the same general nature as the Bonds (i)
that provide for a semiannual adjustment of the interest rate, (ii) that (A)
must be purchased on demand of the owner thereof at any time upon notice of up
to six (6) months or (B) are payable in full no later than six (6) months after
the date of evaluation and (iii) the interest on which is excluded from gross
income for federal income tax purposes, provided that, if such index rate shall
not be established the Alternate Semiannual Index shall be the sum of W the
product of (A) the interest rate for ninety-day taxable commercial paper (prime
paper placed through dealers) announced for the first day of each Interest
Period during a Semiannual Rate Period (or, if such day is not a Business Day,
the next succeeding Business Day) by the Federal Reserve Bank of New York
converted to a coupon equivalent rate multiplied by (B) 1 minus the lesser of
-3-
<PAGE> 8
(a) the maximum federal income tax rate payable by individuals at the time on
interest income and (b) the maximum federal income tax rate payable by
corporations at the time on interest income, plus (ii) 3.00% or, if interest on
the Bonds is an item of tax preference in determining alternative minimum
taxable income under the Code, 3.50%.
"Alternate Weekly Index" means the index rate selected by the
Remarketing Agent that is a composite of current bid-side yields of obligations
that are comparable as to credit and of the same general nature as the Bonds (i)
that provide for a weekly adjustment of the interest rate, (ii) that (A) must be
purchased on the demand of the owner thereof at any time upon notice of up to
seven (7) days or (B) are payable in full no later than seven (7) days after the
date of evaluation and (iii) the interest on which is excluded from gross income
for federal income tax purposes; provided that, if such index rate shall not be
established, the Alternate Weekly Index shall be the sum of (i) the product of
(A) the interest rate for thirty-day taxable commercial paper (prime paper
placed through dealers) announced for the first day of each Interest Period
during a Weekly Rate Period (or, if such day is not a Business Day, the next
succeeding Business Day) by the Federal Reserve Bank of New York, converted to a
coupon equivalent rate multiplied by (B) 1 minus the lesser of (a) the maximum
federal income tax rate payable by individuals at the time on interest income
and (b) the maximum federal income tax rate payable by corporations at the time
on interest income, plus (ii) 2.25% or, if interest on the Bonds is an item of
tax preference in determining alternative minimum taxable income under the Code,
2.50%.
"Authorized Denomination" means (a) during any ShortTerm Rate
Period or any Medium-Term Rate Period, $100,000 and integral multiples thereof,
and (b) during the Fixed Rate Period, $5,000 or any integral multiple thereof.
"Authorized Representative" means any officer or other employee of
the Company at the time designated to act on behalf of the Company by written
certificate submitted to the Trustee and signed by the President or a Vice
President of the Company and containing such officer's or employee's specimen
signature.
"Beneficial Owner" means the Person in whose name a Bond is
recorded as beneficial owner of such Bond by the Securities Depository or a
Participant or an Indirect Participant on the records of such Securities
Depository, Participant or Indirect Participant, as the case may be, or such
Person's subrogee.
"Bond" or "Bonds" means the Bonds authorized under this Indenture.
"Bond Counsel" means an attorney, or firm of attorneys, nationally
recognized and experienced in legal work relating to the financing of facilities
through the issuance of tax-exempt bonds.
"Bond Fund" means the fund created by Section 4.1.
-4-
<PAGE> 9
"Bond Purchase Fund" means the fund created by Section 4.4.
"Book Entry System" means a book entry system established and
operated for the recordation of Beneficial Owners of the Bonds pursuant to
Section 2.20.
"Business Day" means any day on which the offices of the Credit
Issuer at which drawings on the Credit Facility are made (if a Credit Facility
is in effect), the Trustee, the Paying Agent, the Tender Agent, the Registrar
and the Remarketing Agent are each open for business and on which The New York
Stock Exchange is not closed.
"Ceiling Rate" means 15% per annum.
"Code" means the Internal Revenue Code of 1986, as amended, and
the rulings and regulations (including temporary and proposed regulations)
promulgated thereunder or under the Internal Revenue Code of 1954, as amended.
"Company" means Dixie Bedding Company, a North Carolina
corporation, and its successors and assigns.
"Company Agent" shall have the meaning set forth in Section 7.2.
"Computation Date" means (a) the Business Day next preceding the
first day of each Interest Period during which the Bonds bear interest at a
Weekly Rate, (b) the last Business Day of the calendar month next preceding each
Interest Period during which the Bonds bear interest at a Monthly Rate, (c) the
Business Day next preceding the first day of each Interest Period during which
the Bonds will bear interest at a Semiannual Rate and (d) a date that is not
more than twenty (20) nor less than two (2) days prior to any Conversion Date
relating to conversion to a Long-Term Rate.
"Conversion Date" means (i) the Fixed Rate Conversion Date, (ii)
each date on which the Interest Rate Determination Method then in effect is
changed to another Interest Rate Determination Method, (iii) each date on which
the interest rate borne by the Bonds is changed from the interest rate
applicable during a Medium-Term Rate Period to the interest rate applicable
during another Medium-Term Rate Period and (iv) each date on which the interest
rate borne by the Bonds is changed from a Mney Market Rate to another Money
Market Rate (or, with respect to notices, time periods and requirements in
connection with the proceedings for such change, the day on which it is proposed
that such change occur).
"Conversion Notice" shall have the meaning set forth in Section
2.4(a).
"Costs of the Project" shall have the meaning specified in the
Agreement.
-5-
<PAGE> 10
"Counsel" means an attorney, or firm of attorneys, admitted to
practice law before the highest court of any state in the United States of
America or the District of Columbia, including any Bond Counsel.
"Credit Agreement" means any agreement between the Company and a
Credit Issuer relating to a Credit Facility, as such agreement may be amended or
supplemented from time to time pursuant to its terms.
"Credit Facility" means a letter of credit, insurance policy,
surety bond or other instrument or device issued by a Credit Issuer on the Issue
Date or pursuant to Section 2.5 in favor of the Trustee, for the account of the
Company, which provides security for the payment of certain payments on or with
respect to the Bonds as contemplated pursuant to Section 3.8 and upon acceptance
by the Trustee of any Alternate Credit Facility, such Alternate Credit Facility.
"Credit Issuance Date" means any date on which a Credit Facility
is issued pursuant to Section 2.5.
"Credit Issuance Notice" shall have the meaning set forth in
Section 2.5(a)(1).
"Credit Issuer" means the issuer of any Credit Facility, its
successors and their respective assigns; provided, however, that in connection
with the acceptance of an Alternate Credit Facility that results in the
occurrence of a mandatory Purchase Date, until the occurrence of such Mandatory
Purchase Date, "Credit Issuer" shall mean the Credit Issuer immediately prior to
acceptance of such Alternate Credit Facility.
"Credit Modification Date" means the second Business Day next
preceding the day on which a Credit Facility then in effect is to expire (unless
extended) or is to be terminated prior to its stated expiration if:
(a) the Bonds are then rated by a Rating Agency and (1) the
Company fails to deliver to the Trustee, no more than sixty (60) nor less than
forty (40) days prior to the second Business Day preceding such expiration or
termination date, (A) notice that an Alternate Credit Facility will be delivered
to the Trustee on or prior to the second Business Day preceding such expiration
or termination date, and (B) a letter from any Rating Agency then rating the
Bonds stating that such Rating Agency has reviewed the terms of such Alternate
Credit Facility and the issuer thereof and that acceptance of the Alternate
Credit Facility for the benefit of the Holders will not result in a lowering or
elimination of the rating then assigned by such Rating Agency to the Bonds, (2)
the Company delivers such notice and letter but prior to the date such Alternate
Credit Facility is to be delivered such Rating Agency revokes such letter, or
(3) the Company delivers such notice and letter but such Alternate Credit
Facility is not delivered to, and
-6-
<PAGE> 11
accepted by, the Trustee on or prior to the second Business Day preceding such
expiration or termination date; or
(b) the Bonds are not then rated and (1) the Company fails to
deliver to the Trustee, not more than sixty (60) nor less than forty (40) days
prior to such expiration or termination date, (A) notice that an Alternate
Credit Facility will be delivered to the Trustee on or prior to the second
Business Day preceding such expiration or termination date, and (B) written
evidence that the issuer of such Alternate Credit Facility is a commercial bank
or insurance company organized and doing business in the United States of
America or a branch or agency of a foreign commercial bank located and doing
business in the United States of America and subject to regulation by state or
federal banking regulatory authorities and that has, as of the date sixty (60)
days prior to such expiration or termination date (i) senior debt or long-term
bank deposits rated by a Rating Agency with a rating at least equivalent to the
senior debt or long-term bank deposits of the Credit Issuer of the Credit
Facility then in effect or (ii) outstanding letters of credit, insurance
policies, surety bonds or other similar instruments that, when supporting debt
obligations, result in such debt obligations being rated by a Rating Agency with
a rating at least the equivalent of the ratings assigned to debt obligations
supported with letters of credit, insurance policies, surety bonds or other
similar instruments or devices issued by such Credit Issuer on the date sixty
(60) days prior to such expiration or termination date or (2) the Company
delivers such notice but such Alternate Credit Facility is not delivered to, and
accepted by, the Trustee on or prior to the second Business Day preceding such
expiration or termination date.
"Current Account" means the account within the Bond Fund
established pursuant to Section 4.1.
"Determination of Taxability" means a determination that the
interest accrued or paid on any of the Bonds is included in gross income of the
Holders or former Holders for federal income tax purposes, which determination
shall be deemed to have been made upon the occurrence of the first to occur of
the following:
(a) the day on which the Company is advised in writing by the
Commissioner or any District Director of the Internal Revenue Service that the
interest on the Bonds is included in the gross income of any Holder or former
Holder thereof for federal income tax purposes;
(b) the day on which the Company receives notice from the Trustee
in writing that the Trustee has received (i) notice in writing by any Holder or
former Holder that the Internal Revenue Service has issued a statutory notice of
deficiency or similar notice to such Holder or former Holder that asserts in
effect that the interest on the Bonds received by such Holder or former Holder
is included in the gross income of such Holder or former Holder for federal
income tax purposes, or (ii) an Opinion of Bond Counsel that concludes in effect
that the interest on the Bonds is included
-7-
<PAGE> 12
in the gross income of any Holder or former Holder thereof for federal income
tax purposes;
(c) the day on which the Company is advised in writing by the
Commissioner or any District Director of the Internal Revenue Service that there
has been issued a public or private ruling of the Internal Revenue Service or a
technical advice memorandum issued by the national office of the Internal
Revenue Service that the interest on the Bonds is included in the gross income
of any Holder or former Holder thereof for federal income tax purposes; or
(d) the day on which the Company is advised in writing by Counsel
that a final determination, from which no further right of appeal exists, has
been made by a court of competent jurisdiction in the United States of America
in a proceeding with respect to which the Company has been given written notice
and an opportunity to participate and defend that the interest on the Bonds is
included in the gross income of any Holder or former Holder thereof for federal
income tax purposes;
provided, however, (i) no Determination of Taxability shall occur if the
interest on any of the Bonds is included in the gross income of any Holder or
former Holder for federal income tax purposes solely because such Bond was held
by a Person who is a Substantial User or a Related Person, (ii) no Determination
of Taxability shall occur because interest on the Bonds is an item of tax
preference or is otherwise taken into account in determining alternative minimum
taxable income under the Code and (iii) during any Weekly Rate Period, no
Determination of Taxability shall occur under subparagraphs (a), (b) (i) and
(c) of this paragraph unless the Company has been afforded the opportunity to
contest any such advisement, notice of deficiency, ruling or other conclusion
and such contest by the Company, if made, has been finally determined (with no
further right of appeal) adversely to the Company or until two years shall have
elapsed since receipt of such advisement, notice, ruling or conclusion without
any such final determination.
"Eligible Funds" means moneys held by the Trustee or the Paying
Agent under this Indenture which consist of any of the following:
(i) any moneys if, in the written opinion of Counsel
experienced in bankruptcy law matters (which opinion shall be
delivered to the Trustee and the Rating Agency, if any, rating the
Bonds at or prior to the time of the deposit of such moneys with
the Trustee and such opinion shall be in a form satisfactory to
the Rating Agency, if any, rating the Bonds), the deposit and use
of such moneys will not constitute an avoidable preferential
payment pursuant to Section 547 of the United States Bankruptcy
Code, 11 U.S.C. Section 101 et seq., or a post-petition transfer
in the event the Issuer or the Company were to become a debtor
under the United States Bankruptcy Code, and if a Rating Agency is
rating the Bonds, such Rating Agency has confirmed to the Trustee
in
-8-
<PAGE> 13
writing that its rating will not be withdrawn or reduced as a
result of using such moneys;
(ii) moneys other than those described in (iii) below, deposited
in the Bond Fund or the Bond Purchase Fund or transferred into the
Bond Fund from the Surplus Fund that have been held by the Trustee
in any such fund for at least 123 (or, if any Person other than
the Company is obligated as a guarantor on the Bonds or under the
Agreement or the Credit Agreement, or if the source of such moneys
is an "insider" with respect to the Company or the Issuer within
the meaning of Title 11 of the United States Code, as amended,
367) consecutive days prior to and during which no Act of
Bankruptcy shall have occurred with respect to the Company or such
other Person or "insider, " or to the Issuer, as applicable;
(iii) moneys paid by the Credit Issuer to the Trustee under the
Credit Facility; or
(iv) moneys derived from the investment of money described in
clauses (i), (ii) or (iii) above.
"Event of Default" means any of the events specified in Section
6.1.
"Financing Statements" means any and all financing statements
(including continuation statements) or other instruments filed or recorded to
protect the Security Interest created in this Indenture.
"Fixed Rate" means the Fixed Rate established in accordance with
Section 2.3(g).
"Fixed Rate Conversion Date" means the day on which the Interest
Rate Determination method shall be converted to the Fixed Rate.
"Fixed Rate Period" means the period from and including the Fixed
Rate Conversion Date to and including the date of payment in full of the Bonds.
"Government Obligations" means (a) direct obligations of the
United States of America for the full and timely payment of which the full faith
and credit of the United States of America is pledged, and (b) obligations
issued by a Person controlled or supervised by and acting as an instrumentality
of the United States of America, the full and timely payment of the principal
of, premium, if any, and interest on which is fully guaranteed as a full faith
and credit obligation of the United States of America (including any securities
described in (a) or (b) issued or held in book-entry form on the books of the
Department of the Treasury of the United States of America), which obligations,
in either case, are not subject to redemption prior to maturity at less than par
at the option of anyone other than the holder thereof.
-9-
<PAGE> 14
"Holder" means the Person who shall be the registered owner of any
Bond.
"Indenture" means this Indenture of Trust, as the same may be
amended or supplemented from time to time as permitted hereby.
"Indirect Participant" means a broker-dealer, bank or other
financial institution for which the Securities Depository holds Bonds as a
securities depository through a Participant.
"Initial Fund" means the fund created pursuant to Section 4.2.
"Interest Payment Date" means (i) during any Weekly Rate Period,
Monthly Rate Period or Money Market Rate Period, each Quarterly Interest Payment
Date, (ii) each Mandatory Purchase Date, and (iii) during any Semiannual Rate
Period, any Medium-Term Rate Period or the Fixed Rate Period, each Semiannual
Interest Payment Date.
"Interest Period" means (a) with respect to the Bonds bearing
interest at a Weekly Rate, the period from and including the Issue Date to and
including the next Wednesday, the period from and including the Conversion Date
on which the Interest Rate Determination Method is changed to the Weekly Rate to
and including the next Wednesday and, in each case, each succeeding period from
and including each Thursday to and including the following Wednesday, (b) with
respect to the Bonds bearing interest at a Monthly Rate, the period from and
including the Conversion Date on which the Interest Rate Determination Method is
changed to the Monthly Rate to and including the last day of the calendar month
in which such Conversion Date occurred and each succeeding period from and
including the first day of each calendar month to and including the last day of
such calendar month, and (c) with respect to any Bond bearing interest at a
Semiannual Rate, the period from and including the Conversion Date on which the
Interest Rate Determination Method is changed to the Semiannual Rate to and
including the day immediately preceding the next Interest Payment Date and each
succeeding period from and including each Interest Payment Date to and including
the day immediately preceding the next Interest Payment Date.
"Interest Rate Determination Method" means any of the methods of
determining the interest rate on the Bonds described in Section 2.3.
"Issue Date" means the date on which the Bonds are delivered to
the purchaser or purchasers thereof upon original issuance.
"Issuer" means the Iowa Finance -Authority, a public
instrumentality and agency of the State of Iowa duly organized and existing
under the laws of the State of Iowa, including the Act, or
-10-
<PAGE> 15
any successor to its rights and obligations under the Agreement and this
Indenture.
"Local Time" means eastern time (daylight or standard, as
applicable).
"Long-Term Rate" means either a Medium-Term Rate or the Fixed
Rate.
"Long-Term Rate Period" means either a Medium-Term Rate Period or
the Fixed Rate Period.
"Mandatory Purchase Date" means (i) a Conversion Date, (ii) a
Credit Modification Date, or (iii) a Credit Issuance Date.
"Medium-Term Rate" means the interest rate on the Bonds
established from time to time pursuant to Section 2.3(f).
"Medium-Term Rate Period" means any period during which the Bonds
bear interest at a Medium-Term Rate.
"Money Market Percentage" means any percentage selected as such by
the Remarketing Agent in accordance with Section 2.3(e).
"Money Market Rate" means the product of (a) the Money Market Rate
Index and (b) the Money Market Percentage.
"Money Market Rate Index" means (a) the rate of interest publicly
announced by the Remarketing Agent at its principal office from time to time as
its "Prime Rate," or (b) any other index of money market instruments, including,
but not limited to, the federal funds rate, certificate of deposit rates, the
prime rate announced by any other commercial bank and the London Interbank
Offered Rate, selected by the Remarketing Agent pursuant to Section 2.3(e) as
specified in a written notice to the Trustee and the Company.
"Money Market Rate Period" means any period of not less than forty
(40) days during which the Bonds bear interest at a Money Market Rate.
"Monthly Rate" means the interest rate on the Bonds established
from time to time pursuant to Section 2.3(c).
"Monthly Rate Period" means any period during which the Bonds bear
interest at a Monthly Rate.
"Moody's" means Moody's Investors Service, Inc., a corporation
organized and existing under the laws of the State of Delaware, its successors
and assigns and, if such corporation shall be dissolved or liquidated or shall
no longer perform the functions of a securities rating agency, "Moody's" shall
be deemed to refer to any other nationally recognized securities rating agency
designated by the Company with the approval of the Remarketing Agent, by notice
to the Issuer and the Trustee.
-11-
<PAGE> 16
"Opinion of Bond Counsel" means any opinion of Bond Counsel
required to be delivered pursuant to this Indenture with respect to the
excludability of interest on the Bonds from gross income for federal income tax
purposes. Each such opinion shall be addressed to the Trustee, the Remarketing
Agent, the Company, the Issuer and the Paying Agent. No such opinion delivered
pursuant hereto shall be deemed unsatisfactory when required as a condition to
any provision hereunder because such opinion states that interest on the Bonds
is an item of tax preference or is includable in determining alternative minimum
taxable income under the Code.
"Optional Tender Date" means (i) during any Weekly Rate Period,
any Business Day selected by the Holder, (ii) during any Monthly Rate Period,
the first Business Day of each Interest Period, and (iii) during any Semiannual
Rate Period, each Interest Payment Date (or, if such Interest Payment Date is
not a Business Day, the next succeeding Business Day).
"Original Credit Facility" means the Credit Facility issued by the
Credit Issuer to the Trustee on the Issue Date, and any extensions and renewals
thereof.
"Outstanding" means, when used with reference to the Bonds at any
date as of which the amount of outstanding Bonds is to be determined, all Bonds
that have been authenticated and delivered by the Trustee hereunder, except:
(a) Bonds cancelled or delivered for cancellation at or prior to
such date;
(b) Bonds deemed to be paid in accordance with Section 5.2;
(c) Bonds in lieu of which others have been authenticated under
Sections 2.13, 2.14 and 2.15;
(d) Untendered Bonds; and
(e) For purposes of any consent, request, demand, authorization,
direction, notice, waiver or other action to be taken by the Holders of a
specified percentage of Outstanding Bonds hereunder, all Bonds held by or for
the account of the Issuer or the Company; provided, however, that for purposes
of any such consent, request, demand, authorization, direction, notice, waiver
or action the Trustee shall be obligated to consider as not being outstanding
only Bonds known by the Trustee by actual notice thereof to be so held.
"Participant" means a broker-dealer, bank or other financial
institution for which the Securities Depository holds Bonds as a securities
depository.
"Paying Agent" means Wachovia Bank of North Carolina, National
Association, and its successors appointed and serving under this Indenture.
-12-
<PAGE> 17
"Permitted Investments" means any one or more of the following
investments, if and to the extent the same are then legal investments under the
applicable laws of the State for moneys proposed to be invested therein:
(a) Bonds or other obligations of the United States;
(b) Bonds or other obligations, the payment of the principal and
interest of which is unconditionally guaranteed by the United States;
(c) Direct obligations issued by the United States or obligations
guaranteed in full as to principal and interest by the United States or
Repurchase Agreements with a qualified depository bank fully collateralized by
such obligations, maturing on or before the date when such funds will be
required for disbursement;
(d) Obligations of state and local government and municipal bond
issuers, which are rated investment-grade by either S&P or Moody's or other
non-rated obligations guaranteed or credit enhanced by a Person whose long-term
debt or long-term deposits or other obligations are rated investment-grade by
either S&P or Moody's;
(e) Prime commercial paper;
(f) Bankers, acceptances drawn on and accepted by commercial
banks;
(g) Interests in any money market fund or trust, the investments
of which are restricted to obligations described in clauses (a), (b), (c), (d),
(e) or (f) of this definition; and
(h) Such other obligations as may at any time hereafter be
authorized by applicable law.
"Person" means any natural person, firm, partnership, association,
corporation or public body.
"Placement Agent" means Wachovia Bank of Georgia, National
Association.
"Placement Agreement" means the Placement Agreement, dated March
__ 1995 among the Issuer, the Company and the Placement Agent, relating to the
initial placement of the Bonds.
"Project" means the Project as defined in the Agreement.
"Proposed Rate" means, with respect to any Monthly Rate or
Semiannual Rate, the rate of interest, determined on the applicable Proposed
Rate Computation Date, that the Remarketing Agent, having due regard for
prevailing market conditions for revenue bonds or other securities of the same
general nature as the Bonds or securities that are comparable as to credit and
maturity (or comparable with respect to optional tender provisions) with the
-13-
<PAGE> 18
credit and maturity and optional tender provisions of the Bonds and taking into
account interest rate trends, market trends, general economic conditions and
such other factors as the Remarketing Agent deems appropriate (including the
excludability of interest on such revenue bonds and other securities from gross
income for federal income tax purposes), anticipates to be the interest rate
necessary to place the Bonds on the effective date of such Monthly Rate or
Semiannual Rate at a price of par (plus accrued interest, if any).
"Proposed Rate Computation Date" means each date that is (a) six
(6) days prior to each Computation Date (or if such day is not a Business Day,
the next preceding Business Day) with respect to any Monthly Rate Period, or (b)
twenty (20) days prior to each Computation Date with respect to any Semiannual
Rate Period (or if such day is not a Business Day, the next preceding Business
Day).
"Purchase Price" means an amount equal to 100% of the principal
amount of any Bond tendered or deemed tendered for purchase pursuant to Section
2.6, plus accrued and unpaid interest thereon to the date of purchase.
"Quarterly Interest Payment Date" means each January 1, April 1,
July 1 and October 1.
"Rate" means any Short-Term Rate or any Long-Term Rate.
"Rate Index" means any of the Alternate Medium-Term Index, the
Alternate Monthly Index, the Alternate Semiannual Index, the Alternate Weekly
Index or any combination of any thereof, as the context may require.
"Rate Period" means any Weekly Rate Period, Monthly Rate Period,
Semiannual Rate Period, Money Market Rate Period, Medium-Term Rate Period or
Fixed Rate Period.
"Rating Agency" means Moody's when the Bonds are rated by Moody's,
and S&P when the Bonds are rated by S&P.
"Record Date" means with respect to each Interest Payment Date (i)
during any Short-Term Rate Period, the Trustee's close of business on the
Business Day next preceding such Interest Payment Date, and (ii) during any
Long-Term Rate Period, the Trustee's close of business on the fifteenth (15th)
day of the calendar month next preceding the calendar month during which such
Interest Payment Date occurs, regardless of whether such day is a Business Day.
"Register" means the register of the record owners of Bonds
maintained by the Registrar.
"Registrar" means the Trustee.
-14-
<PAGE> 19
"Related Person" with reference to any Substantial User, means a
"related person" within the meaning of Section 147(a)(2) of the Code.
"Remarketing Agent" means Wachovia Bank of Georgia, National
Association and its successors appointed and serving in such capacity under this
Indenture.
"Remarketing Agreement" means any agreement between the Company
and a Remarketing Agent relating to the Bonds, as such agreement may be amended
or supplemented from time to time pursuant to its terms.
"Repayments" means all amounts required to be paid by the Company
to the Issuer (and the Trustee, as the assignee of the Issuer) pursuant to
Section 5.2 of the Agreement.
"Replacement Bonds" means Bonds issued pursuant to Section 2.15,
which Bonds shall contain the terms and provisions specified herein as being
applicable to the Bonds following a Mandatory Purchase Date and have excised
therefrom the terms and provisions that are not so applicable and added thereto
terms that have become applicable.
"Reserved Rights" means the rights of the Issuer pursuant to
Sections 5.2(b), 5.2(c), 8.1, 8.6, 8.7, 12.6 and 12.7 of the Agreement and the
rights of the Issuer pursuant to other sections of the Agreement providing that
notices, reports and other statements be given to the Issuer and that specified
consents be obtained from the Issuer.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw-Hill, Inc., its successors and their assigns and, if such corporation
shall be dissolved or liquidated or shall no longer perform the functions of a
securities rating agency, "S&P" shall be deemed to refer to any other nationally
recognized securities rating agency designated by the Company with the approval
of the Remarketing Agent, by notice to the Issuer and the Trustee.
"Securities Depository" means The Depository Trust Company and any
substitute for or successor to such securities depository that shall maintain a
Book Entry System with respect to the Bonds.
"Securities Depository Nominee" means the Securities Depository or
the nominee of such Securities Depository in whose name there shall be
registered on the Register the Bonds to be delivered to such Securities
Depository during the continuation with such Securities Depository of
participation in its Book Entry System.
"Security" means the revenues (including Repayments), funds,
rights and interests specified in Section 3.1.
-15-
<PAGE> 20
"Security Interest" or "Security Interests" means the security
interests created herein and shall have the meanings set forth in the U.C.C.
"Semiannual Interest Payment Date" means each January 1 and July
1.
"Semiannual Rate" means the interest rate on the Bonds established
from time to time pursuant to Section 2.3(d).
"Semiannual Rate Period" means any period during which the Bonds
bear interest at a Semiannual Rate.
"Short-Term Rate" means any of the Weekly Rate, the Monthly Rate,
the Semiannual Rate or the Money Market Rate.
"Short-Term Rate Period" means any period during which the Bonds
bear interest at a Short-Term Rate.
"State" means the State of Iowa.
"Substantial User" means, with respect to any "facilities" (as the
term "facilities" is used in Section 144(a) of the Code), a "substantial user"
of such "facilities" within the meaning of Section 147(a) of the Code.
"Surplus Bond Proceeds" means all moneys and any unliquidated
investments remaining in the Initial Fund on the Completion Date and after
payment in full of the Costs of the Project (except for costs not then due and
payable for which the Trustee shall have retained amounts pursuant to the
Agreement).
"Surplus Fund" means the fund created pursuant to Section 4.3.
"Tender Agent" means Wachovia Bank of North Carolina, National
Association, and its successors appointed and serving in such capacity under
this Indenture.
"Tender Agent Agreement" means any certificate or agreement
executed by a Tender Agent in connection with such Tender Agent's duties
hereunder.
"Trustee" means First-Citizens Bank & Trust Company, or any
successor trustee appointed under this Indenture.
"U.C.C." means the Uniform Commercial Code of the State as now in
effect or hereafter amended.
"Untendered Bond" means any Untendered Bond as defined in Section
2.6(f).
"Weekly Rate" means the interest rate on the Bonds established
pursuant to Section 2.3(b).
-16-
<PAGE> 21
"Weekly Rate Period" means any period during which the Bonds bear
interest at a Weekly Rate.
ARTICLE II
THE BONDS
Section 2.1. Authorized Amount of Bonds. No Bonds may be issued
under the provisions of this Indenture except in accordance with this Article.
The total principal amount of Bonds that may be issued and outstanding hereunder
is expressly limited to $3,000,000, subject to the provisions of Sections 2.13,
2.14 and 2.15. The Bonds shall be designated "Iowa Finance Authority Tax-Exempt
Adjustable Mode Industrial Development Revenue Bonds (Dixie Bedding Company
Project) Series 1995." The form of Bond attached as Exhibit A to this Indenture
shall be the form of Bond referred to herein.
Section 2.2. Issuance of Bonds. The Bonds shall bear interest from
the date thereof, until paid, at the rates set forth in Section 2.3 (computed on
the basis of a 365-day year (366 days in a leap year) for the actual days
elapsed during any Short-Term Rate Period other than a Money Market Rate Period
or a Semiannual Rate Period, a 360-day year of twelve 30-day months during any
Long-Term Rate Period or Semiannual Rate Period and a 360-day year for actual
days elapsed during any Money Market Rate Period (calculated by multiplying the
principal amount of Bonds by the interest rate, dividing that sum by 360, and
multiplying that amount by the actual days elapsed)), and shall mature, unless
sooner paid, on April 1, 2015 on which date all unpaid principal, redemption
premium, if any, and interest on the Bonds shall be due and payable.
The Bonds shall be issued as fully registered bonds without
coupons in Authorized Denominations. The Bonds shall be numbered from R-1
upwards bearing numbers not then contemporaneously outstanding (in order of
issuance) according to the records of the Registrar.
The Bonds shall be dated the Issue Date. Interest on the Bonds
shall be computed from the Interest Payment Date to which interest has been paid
or duly provided for next preceding the date of authentication thereof, unless
(a) such date of authentication shall be prior to the first Interest Payment
Date, in which case interest shall be computed from the Issue Date, or (b) such
date of authentication shall be an Interest Payment Date to which interest on
the Bonds has been paid in full or duly provided for, in which case interest
shall be computed from such date of authentication; provided, however, that if
interest on the Bonds shall be in default, Bonds issued in exchange for Bonds
surrendered for registration of transfer or exchange shall bear interest from
the last date to which interest has been paid or duly provided for on the Bonds
or, if no interest has been paid or duly provided for on the Bonds, from the
Issue Date.
-17-
<PAGE> 22
The principal of, redemption premium, if any, and the interest on
the Bonds shall be payable in lawful currency of the United States. The
principal of and redemption premium, if any, on the Bonds shall be payable at
the principal office of the Paying Agent upon presentation and surrender of the
Bonds. Payments of interest on the Bonds will be mailed to the persons in whose
names the Bonds are registered on the Register at the close of business on the
Record Date next preceding each Interest Payment Date; provided that, prior to
the Fixed Rate Conversion Date, any Holder of a Bond or Bonds in an aggregate
principal amount of not less than $250,000 may, by prior written instructions
filed with the Paying Agent (which instructions shall remain in effect until
revoked by subsequent written instructions), instruct that interest payments for
any period prior to the Fixed Rate Conversion Date be made by wire transfer to
an account in the continental United States or other means acceptable to the
Paying Agent.
Section 2.3. Interest Rates on Bonds.
(a) Initial Rate - General. The Bonds shall bear interest as
provided herein from their respective dates to and including the date of payment
in full of the Bonds. Interest accrued on the Bonds shall be paid on each
Interest Payment Date (or, if such day is not a Business Day, the next
succeeding Business Day) commencing on the earlier of the first Mandatory
Purchase Date or July 1, 1995 (or if such day is not a Business Day, the next
succeeding Business Day). The interest rate on the Bonds will be determined as
provided in this Section except that no rate shall exceed the lesser of (i) the
Ceiling Rate or (ii) the maximum rate permitted by applicable law. The Bonds
shall initially bear interest at a Weekly Rate from the Issue Date until the
date on which the Interest Rate Determination Method is changed as described in
Section 2.4. Such Weekly Rate for the initial Interest Period shall be
determined by the Placement Agent on the Issue Date in the manner set forth in
Section 2.3(b) with respect to subsequent Interest Periods. Thereafter, during
any Weekly Rate Period, the Remarketing Agent will determine a Weekly Rate in
accordance with Section 2.3(b). Notwithstanding anything herein to the contrary,
each Interest Rate Determination Method in effect from time to time shall
continue in effect until the date on which such Interest Rate Determination
Method is changed as described in Section 2.4.
(b) Weekly Rate. During any Weekly Rate Period the Bonds will bear
interest at the Weekly Rate. During any Weekly Rate Period, the Remarketing
Agent will determine the Weekly Rate for the applicable Interest Period by 4:00
p.m., Local Time, on the applicable Computation Date. Each Weekly Rate shall be
the rate of interest that, if borne by the Bonds, would, in the judgment of the
Remarketing Agent, having due regard for the prevailing financial market
conditions for revenue bonds or other securities the interest on which is
excluded from gross income for federal income tax purposes of the same general
nature as the Bonds or securities the interest on which is excluded from gross
income for federal income tax purposes that are comparable as to credit and
maturity (or comparable with respect to optional tender provisions) with the
-18-
<PAGE> 23
credit and maturity or the optional tender provisions of the Bonds, be the
interest rate necessary, but would not exceed the interest rate necessary, to
enable the Remarketing Agent to place the Bonds at a price of par (plus accrued
interest, if any) on the first Business Day of such Interest Period; provided,
that, if for any reason the Weekly Rate for any Interest Period is not
established as aforesaid by the Remarketing Agent, no Remarketing Agent shall be
serving as such hereunder or the rate so established is held to be invalid or
unenforceable with respect to any Interest Period, then the Weekly Rate for such
Interest Period shall be 100% of the Alternate Weekly Index on the date such
interest rate was (or would have been) determined as provided above. The
Remarketing Agent (or if no Remarketing Agent is serving as such hereunder, the
Trustee) shall notify the Company immediately by telephone if the Alternate
Weekly Index is applicable, with written notice to follow promptly. In
connection with any change in the Interest Rate Determination Method to a Weekly
Rate pursuant to Section 2.4(a), the initial Weekly Rate shall be determined as
provided above on the applicable Computation Date.
(c) Monthly Rate. During any Monthly Rate Period the Bonds will
bear interest at the Monthly Rate. During any Monthly Rate Period, the
Remarketing Agent will determine the Proposed Rate for the applicable Interest
Period by 2:00 p.m., Local Time, on the Proposed Rate Computation Date.
Thereafter, the Remarketing Agent will determine a Monthly Rate by 4:00 p.m.,
Local Time, on the applicable Computation Date; provided, however, that such
rate shall not be less than the Proposed Rate determined by the Remarketing
Agent on the preceding Proposed Rate Computation Date. Each Monthly Rate shall
be the rate of interest which, if borne by the Bonds, would, in the judgment of
the Remarketing Agent, having due regard for the prevailing financial market
conditions for revenue bonds or other securities the interest on which is
excluded from gross income of the holders thereof for federal income tax
purposes of the same general nature as the Bonds or securities the interest on
which is excluded from gross income of the holders thereof for federal income
tax purposes that are comparable as to credit and maturity (or comparable with
respect to optional tender provisions) with the credit and maturity or the
optional tender provisions of the Bonds, be the interest rate necessary, but
(subject to the foregoing proviso concerning the Proposed Rate) would not exceed
the interest rate necessary, to enable the Remarketing Agent to place the Bonds
at a price of par (plus accrued interest, if any) on the first Business Day of
such Interest Period; provided that, if for any reason the Monthly Rate or the
Proposed Rate for any Interest Period is not established as aforesaid by the
Remarketing Agent, no Remarketing Agent shall be serving as such hereunder or
the rate so established is held to be invalid or unenforceable with respect to
any Interest Period, then the Monthly Rate for such Interest Period shall be
100% of the Alternate Monthly Index on the date such interest rate was (or would
have been) determined as provided above. The Remarketing Agent (or if no
Remarketing Agent is serving as such hereunder, the Trustee) shall notify the
Company immediately by telephone if the Alternate Monthly Index is applicable,
with written notice to
-19-
<PAGE> 24
follow promptly. In connection with any change in the Interest Rate
Determination Method to a Monthly Rate pursuant to Section 2.4(a), the Proposed
Rate shall be determined as provided above on the applicable Proposed Rate
Computation Date and the initial Monthly Rate shall be determined as provided
above on the applicable Computation Date.
(d) Semiannual Rate. During any Semiannual Rate Period the Bonds
will bear interest at the Semiannual Rate. During any Semiannual Rate Period,
the Remarketing Agent will determine the Proposed Rate for the next Interest
Period by 2:00 p.m., Local Time on the Proposed Rate Computation Date.
Thereafter, the Remarketing Agent will determine a Semiannual Rate for the next
Interest Period by 4:00 p.m., Local Time, on the applicable Computation Date;
provided, however, that such Semiannual Rate shall not be less than the Proposed
Rate determined by the Remarketing Agent on the preceding Proposed Rate
Computation Date. Each Semiannual Rate shall be the rate of interest which, if
borne by the Bonds, would, in the judgment of the Remarketing Agent, having due
regard for the prevailing financial market conditions for revenue bonds or other
securities the interest on which is excluded from gross income of the holders
thereof for federal income tax purposes of the same general nature as the Bonds
or securities the interest on which is excluded from gross income of the holders
thereof for federal income tax purposes that are comparable as to credit and
maturity (or comparable with respect to optional tender provisions) with the
credit and maturity or the optional tender provisions of the Bonds, be the
interest rate necessary, but (subject to the foregoing proviso concerning the
Proposed Rate) would not exceed the interest rate necessary, to enable the
Remarketing Agent to place the Bonds at a price of par (plus accrued interest,
if any) on the first Business Day of such Interest Period. If for any reason the
Semiannual Rate or the Proposed Rate for any Interest Period is not established
as aforesaid by the Remarketing Agent, no Remarketing Agent shall be serving as
such hereunder or the rate so established is held to be invalid or unenforceable
with respect to any Interest Period, then the Semiannual Rate for such Interest
Period shall be 100% of the Alternate Semiannual Index on the date such interest
rate was (or would have been) determined as provided above. The Remarketing
Agent (or if no Remarketing Agent is serving as such hereunder, the Trustee)
shall notify the Company immediately by telephone if the Alternate Semiannual
Index is applicable, with written notice to follow promptly. In connection with
any change in the Interest Rate Determination Method to a Semiannual Rate
pursuant to Section 2.4(a), the Proposed Rate shall be determined as provided
above on the applicable Proposed Rate Computation Date and the initial
Semiannual Rate shall be determined as provided above on the applicable
Computation Date.
(e) Money Market Rate. During any Money Market Rate Period, the
Bonds shall bear interest at the Money Market Rate. During any Money Market Rate
Period, the Remarketing Agent will, in the exercise of its reasonable judgment,
select the Money Market Rate Period, the Money Market Rate Index and Money
Market Percentage not later than 12:30 p.m., Local Time, on the first day
-20-
<PAGE> 25
of such Money Market Rate Period. The Money Market Rate Index and the Money
Market Percentage applicable to the Bonds shall be selected by the Remarketing
Agent with the intention of yielding the lowest Money Market Rate that would be
necessary for the Remarketing Agent to place all the Bonds at a price of par
(plus accrued interest, if any) on the first day of any Money Market Rate Period
on the first day of each Money Market Rate Period, the Remarketing Agent shall
give written notice to the Trustee and the Company specifying (i) the Money
Market Rate Index selected, (ii) the Money Market Percentage selected, and (iii)
the frequency of change or adjustment in rates established pursuant to such
Money Market Rate Index. If for any reason the Remarketing Agent fails to
determine the Money Market Rate, no Remarketing Agent shall be serving as such
hereunder or the rate so established is held to be invalid or unenforceable,
then the Money Market Rate shall be the Weekly Rate established pursuant to
Section 2.3(b). The Remarketing Agent (or if no Remarketing Agent is serving as
such hereunder, the Trustee) shall notify the Company immediately by telephone
if the Weekly Rate is applicable, with written notice to follow promptly.
(f) Medium-Term Rate. During any Medium-Term Rate Period, the
Bonds shall bear interest at the Medium-Term Rate. The interest rate to be borne
by the Bonds from the applicable Conversion Date to the last day of the
applicable Medium-Term Rate Period shall be the rate determined by the
Remarketing Agent on the applicable Computation Date to be the rate which, if
borne by the Bonds would, in the judgment of the Remarketing Agent having due
regard for prevailing market conditions for revenue bonds or other securities
the interest on which is excluded from gross income for federal income tax
purposes and that are comparable to the Bonds, be the interest rate necessary,
but would not exceed the interest rate necessary, to enable the Remarketing
Agent to place the Bonds at a price of par on the applicable Conversion Date. If
for any reason the applicable rate is not established as aforesaid by the
Remarketing Agent, no Remarketing Agent shall be serving as such hereunder or
the rate so established is held to be invalid or unenforceable, the interest
rate to be borne by the Bonds from the applicable Conversion Date to the last
day of the applicable Medium-Term Rate Period shall be equal to 100% of the
Alternate Medium-Term Index as of the applicable Computation Date. The
Remarketing Agent (or if no Remarketing Agent is serving as such hereunder, the
Trustee) shall notify the Company immediately by telephone if the Alternate
Medium-Term Index is applicable, with written notice to follow promptly.
On the Computation Date with respect to a Medium-Term Rate, the
Remarketing Agent shall determine the Medium-Term Rate Period. Each Medium-Term
Rate Period shall be at least 271 days and shall end no later than the date of
maturity of the Bonds or on a day immediately preceding a Business Day. If the
Remarketing Agent fails to determine the Medium-Term Rate Period, no Remarketing
Agent shall be serving as such hereunder or the Medium-Term Rate Period so
established shall be held to be invalid or unenforceable, the Medium-Term Rate
Period shall be (i) if the Interest Rate
-21-
<PAGE> 26
Determination Method in effect immediately prior to such Conversion Date was a
Medium-Term Rate, the shorter of (a) the period equal to the Medium-Term Rate
Period for such Medium-Term Rate (provided, however, that if the last day of
such period would not be a day immediately preceding a Business Day, such period
shall be extended to the next succeeding day that is a day immediately preceding
a Business Day) and (b) the remaining maturity of the Bonds, or (ii) if the
Interest Rate Determination Method in effect immediately prior to such
Conversion Date was not a Medium-Term Rate, the shorter of (a) the period ending
on the first date that is a day immediately preceding a Business Day and is at
least 271 days after the Conversion Date and (b) the remaining maturity of the
Bonds.
If requested in the Conversion Notice by the Company, the
Remarketing Agent may also determine on the Computation Date redemption
premiums, different from those set forth in Section 2.18, for optional
redemption of the Bonds during the Medium-Term Rate Period. These redemption
premiums shall be consistent with the prevailing market conditions, in the
reasonable judgment of the Remarketing Agent. The Remarketing Agent shall not,
however, establish redemption premiums different from those set forth in Section
2.18 unless an Opinion of Bond Counsel shall be furnished to the effect that
such action will not adversely affect the exclusion from gross income of
interest on the Bonds for federal income tax purposes.
(g) Fixed Rate. The Bonds shall bear interest at the Fixed Rate
during the Fixed Rate Period. The interest rate to be borne by the Bonds from
the Fixed Rate Conversion Date to the date of payment in full of the Bonds shall
be the rate determined by the Remarketing Agent on the applicable Computation
Date to be the rate which, if borne by the Bonds would, in the judgment of the
Remarketing Agent having due regard for the prevailing market conditions for
revenue bonds or other securities the interest on which is excluded from gross
income for federal income tax purposes and that are comparable to the Bonds, be
the interest rate necessary, but would not exceed the interest rate necessary,
to enable the Remarketing Agent to place the Bonds at a price of par on the
Fixed Rate Conversion Date. If for any reason the Fixed Rate is not established
as aforesaid by the Remarketing Agent or no Remarketing Agent shall be serving
as such hereunder, then the provisions of the last paragraph of Section 2.4(e)
shall apply; if the Fixed Rate established by the Remarketing Agent is held to
be invalid or unenforceable, the interest rate to be borne by the Bonds from the
Fixed Rate Conversion Date to the date of payment in full of the Bonds shall be
determined by the Remarketing Agent based on the criteria in the preceding
sentence and avoiding the cause of invalidity or unenforceability.
If requested in the Conversion Notice by the Company, the
Remarketing Agent may also determine on the Computation Date redemption
premiums, different from those set forth in Section 2.18, for optional
redemption of the Bonds during the Fixed Rate Period. These redemption premiums
shall be consistent with the prevailing market conditions, in the reasonable
judgment of the
-22-
<PAGE> 27
Remarketing Agent. The Remarketing Agent shall not, however, establish
redemption premiums different from those set forth in Section 2.18 unless an
Opinion of Bond Counsel shall be furnished to the effect that such action will
not adversely affect the exclusion from gross income of interest on the Bonds
for federal income tax purposes.
(h) Notice of Rates. Promptly following the determination of any
Rate or any Proposed Rate, the Remarketing Agent shall give notice thereof to
the Trustee and the Paying Agent. Promptly upon receipt from the Remarketing
Agent of any Semiannual Rate, Medium-Term Rate or Fixed Rate, the Paying Agent
shall give each Holder notice of the new Rate. The Company and any Holder or
Beneficial Owner may obtain any Proposed Rate on or after the applicable
Proposed Rate Computation Date and may obtain any Rate on or after the
applicable Computation Date upon request to the Remarketing Agent.
(i) Absence of Remarketing Agent. If no Remarketing Agent shall be
serving hereunder, the determination of the Alternate Weekly Index, the
Alternate Monthly Index, the Alternate Semiannual Index, the Money Market Rate
Index, the Money Market Percentage and the Alternate Medium-Term Index shall be
made by the Trustee.
(j) Determination of Rate Conclusive. The determination of any
Rate and Proposed Rate by the Remarketing Agent (or the Trustee), shall be
conclusive and binding upon the Issuer, the Company, the Trustee, the Paying
Agent, the Tender Agent, the Remarketing Agent and the Holders or Beneficial
Owners.
(k) No Liability. In determining the interest rate that the Bonds
shall bear as provided in this Section, neither the Remarketing Agent nor the
Trustee shall have any liability to the Issuer, the Company, the Trustee, the
Tender Agent, the Paying Agent, the Registrar, the Credit Issuer or any Holder
or Beneficial Owners except for its gross negligence or willful misconduct.
(l) Opinion of Bond Counsel. If at any time, the interest rate on
the Bonds shall be determined by the application of the Alternate Weekly Index,
Alternate Monthly Index, Alternate Semiannual Index or Alternate Medium-Term
Index, the Company shall use its best efforts to cause to be delivered to the
Trustee an opinion of Bond Counsel to the effect that the determination of the
interest rate on the Bonds by the application of any such index shall not
adversely affect the exclusion of interest on the Bonds from gross income of
Holders or former Holders for federal income tax purposes. If the Trustee does
not receive such Opinion of Bond Counsel within ten (10) days after the date on
which the interest rate on the Bonds is first determined by application of such
index, the Trustee shall promptly give notice to the Issuer, the Credit Issuer,
the Company, the Remarketing Agent, the Tender Agent and the Paying Agent of
such failure.
Section 2.4. Conversion of Interest Rate Determination Method.
-23-
<PAGE> 28
(a) Conversion Notice. The Interest Rate Determination Method may
be changed from any Short-Term Rate or a Medium-Term Rate to any other Interest
Rate Determination Method or from a Medium-Term Rate to a new Medium-Term Rate
or a Money Market Rate to a new Money Market Rate on any Conversion Date by the
Company giving written notice of such change (a "Conversion Notice") to the
Remarketing Agent and the Trustee with a copy to the Issuer, the Tender Agent,
the Paying Agent, the Rating Agency, if any, rating the Bonds and the Credit
Issuer (if any). The Conversion Notice must be received by the Remarketing Agent
and the Trustee at least forty (40) days prior to the proposed Conversion Date.
Each Conversion Notice shall state (i) that the Company elects to
change the Interest Rate Determination Method to a new Interest Rate
Determination Method, or from the interest rate applicable during a Medium-Term
Rate Period to a new interest rate during a new Medium-Term Rate Period, or from
a Money Market Rate to a new Money Market Rate, (ii) the proposed Conversion
Date, (iii) the Interest Rate Determination Method to be in effect from and
after such Conversion Date, (iv) whether a Credit Facility is to be in effect
from and after such Conversion Date, and, if so, the terms of such Credit
Facility, and (v) if a Long-Term Rate is to be in effect from and after such
Conversion Date, and if redemption premiums different from those set forth in
Section 2.18 are to be applicable as described in Sections 2.3(f) and 2.3(g),
the redemption premiums to be applicable during such Long-Term Rate Period.
(b) Opinions With Respect to Conversions. Each Conversion Notice
given to the Remarketing Agent and the Trustee shall be accompanied by an
opinion of Bond Counsel to the effect that the change in the Interest Rate
Determination Method or the change from a Medium-Term Rate to a new Medium-Term
Rate or from a Money Market Rate to a new Money Market Rate will not cause the
interest on the Bonds to be included in the gross income of the recipients
thereof for federal income tax purposes and that such change is permitted under
this Indenture.
The Company shall deliver to the Remarketing Agent and the
Trustee, by 10:00 a.m., Local Time, on each Conversion Date a supplemental
opinion of Bond Counsel to the effect that the change in the Interest Rate
Determination Method or from a Medium-Term Rate to a new Medium-Term Rate or
from a Money Market Rate to a new Money Market Rate is permitted under this
Indenture and, under the laws existing on such Conversion Date, the change will
not cause the interest on the Bonds to be included in the gross income of the
recipients thereof for federal income tax purposes.
(c) Conversion Date. if the Interest Rate Determination Method in
effect prior to a Conversion Date is:
(1) a Weekly Rate or a Monthly Rate, the Conversion Date must be
the first Business Day of an Interest Period;
-24-
<PAGE> 29
(2) a Semiannual Rate, the Conversion Date must be a Semiannual
Interest Payment Date (or, if such day is not a Business Day, the next
succeeding Business Day);
(3) a Money Market Rate with respect to which the applicable Money
Market Rate Index is based on money market instruments not having a fixed
maturity and the interest rate on which may change at any time, the
Conversion Date must be a Business Day;
(4) a Money Market Rate with respect to which the applicable Money
Market Rate Index is based on money market instruments with a fixed
maturity or the interest on which may be changed only on a fixed reset
date, the Conversion Date must be such maturity or reset date; or
(5) a Medium-Term Rate, the Conversion Date must be the day next
succeeding the last day of the Medium-Term Rate Period.
(d) Notice of Conversions to Holders. The Trustee shall give
written notice to the Holders of a Conversion Date, which notice shall be in
substantially the form attached to this Indenture as Exhibit B, appropriately
completed, and shall be sent by first-class mail, postage prepaid, at least
thirty (30) days prior to the Conversion Date.
(e) Failure or Revocation of Conversion. If (i) the Company fails
to deliver to the Trustee and the Remarketing Agent by 10:00 a.m., Local Time,
on the Conversion Date any supplemental Opinion of Bond Counsel required by
subsection (b) of this Section, or (ii) an Event of Default shall have occurred
and be continuing hereunder, the Interest Rate Determination Method for the
Bonds shall not be changed on the Conversion Date and the Trustee shall
immediately notify by telephone the Credit Issuer, if any, the Remarketing
Agent, the Issuer, the Paying Agent and the Tender Agent that the Interest Rate
Determination Method for the Bonds shall not be changed on the Conversion Date.
Notwithstanding any other provision in this Indenture to the
contrary, no conversion of the Interest Rate Determination Method to the Fixed
Rate shall occur if the Company, not later than 10:00 a.m., Local Time, on the
Business Day immediately preceding the applicable Computation Date, directs the
Remarketing Agent not to change the Interest Rate Determination Method to the
Fixed Rate by written notice, with a copy to the Trustee, the Issuer, the Paying
Agent, the Tender Agent, the Remarketing Agent and the Credit Issuer, if any.
If a proposed conversion of the Interest Rate Determination Method
is cancelled pursuant to the provisions of the two preceding paragraphs, all
Bonds shall nevertheless be deemed to have been tendered for purchase on the
Conversion Date and shall be purchased on the Conversion Date. The Bonds shall
continue to bear interest in accordance with the Interest Rate Determination
Method
-25-
<PAGE> 30
in effect prior to the Conversion Date and, in the case of a proposed change
from a Medium-Term Rate or a Money Market Rate, for a Medium-Term Rate Period or
Money Market Rate Period ending on the first day that is a day immediately
preceding a Business Day and that occurs on or after the day that is the same
number of days after the proposed Conversion Date as the number of days in the
immediately preceding Medium-Term Rate Period or Money Market Rate Period, as
the case may be (but in no event later than the maturity of the Bonds);
provided, however, that (i) the rate of interest that the Bonds will bear shall
be determined on the Conversion Date and (ii) if the Interest Rate Determination
Method in effect prior to the Conversion Date is an Interest Rate Determination
Method that requires the Remarketing Agent to set a Proposed Rate, for purposes
of this Section 2.4(e), the provisions of this Indenture requiring the setting
of such Proposed Rate shall not be applicable.
(f) Failure to Mail Certain Notices. Failure to mail the notice
described in subsection (d), or any defect therein, shall not affect the
validity of any interest rate or change in the Interest Rate Determination
Method on any of the Bonds or the requirement that the Bonds shall be tendered
pursuant to Section 2.6(e) or extend the period for tendering any of the Bonds
for purchase, and the Trustee shall not be liable to any Holder by reason of its
failure to mail such notice or any defect therein.
Section 2.5. Issuance of Credit Facility.
(a) Issuance by a Credit Issuer. During any Short-Term Rate Period
or Medium-Term Rate Period during which no Credit Facility is in effect, the
Company may, with the consent of the Remarketing Agent, arrange for issuance by
a Credit Issuer of a Credit Facility, on the terms and subject to the conditions
hereof and upon delivery by the Company to the Trustee, the Remarketing Agent,
the Paying Agent and the Issuer:
(1) of a notice (the "Credit Issuance Notice") on the first
Business Day of any calendar month during any Short-Term Rate Period or
Medium-Term Rate Period, stating that the Company has, with the consent
of the Remarketing Agent, arranged for the issuance of a Credit Facility
and specifying the proposed Credit Issuance Date accompanied by an
Opinion of Bond Counsel to the effect that the issuance of such Credit
Facility will not cause interest on the Bonds to be included in gross
income of the recipients thereof for federal income tax purposes and that
such issuance is permitted under this Indenture; and
(2) by 10:00 a.m., Local Time, on the applicable Credit Issuance
Date, of (i) a supplemental Opinion of Bond Counsel stating that under
the laws existing on the Credit Issuance Date the issuance of the Credit
Facility will not cause the interest on the Bonds to be included in gross
income of the recipients thereof for federal income tax purposes, (ii) an
opinion of Counsel for the Credit Issuer, addressed to the
-26-
<PAGE> 31
Issuer, the Trustee, the Rating Agency, if any, rating the Bonds, the
Remarketing Agent and the Paying Agent, to the effect (a) that the Credit
Facility has been duly executed and delivered by the Credit Issuer and is
also the legal, valid and binding obligation of the Credit Issuer or, if
the Credit Facility is issued by a branch or agency of a foreign
commercial bank, to the effect that the Credit Facility is the legal,
valid and binding obligation of such branch or agency, and (b) that the
issuance of the Credit Facility will not cause the Bonds or the Credit
Facility to be subject to the registration requirements of the Securities
Act of 1933, as amended, and (iii) an opinion of Counsel addressed to the
Trustee, the Issuer, the Rating Agency, if any, rating the Bonds, the
Remarketing Agent and the Paying Agent to the effect that payments of
principal, premium, if any, or Purchase Price of or interest on the Bonds
from the proceeds of a drawing on such Credit Facility will not
constitute avoidable preferential payments pursuant to the provisions of
Section 547 of the United States Bankruptcy Code, 11 U.S.C. Section 101
et seq. In addition, if the Credit Facility is issued by a branch or
agency of a foreign commercial bank, there shall also be delivered an
opinion of Counsel, licensed to practice law in the jurisdiction in which
the main office of such bank is located, to the effect that such Credit
Facility has been duly executed and delivered and is the legal, valid and
binding obligation of such Credit Issuer.
(b) Credit Issuance Date. The Credit Issuance Date must be (i)
with respect to a Weekly Rate Period, Monthly Rate Period or Semiannual Rate
Period, an Optional Tender Date or (ii) with respect to any Money Market Rate
Period or Medium-Term Rate Period, a Conversion Date, in either case that occurs
in the second calendar month following the calendar month during which the
Trustee receives the Credit Issuance Notice.
(c) Notice of Credit Facility to Holders. Upon receipt of a Credit
Issuance Notice from the Company meeting the requirements set forth in
subsection (a) hereof, the Trustee shall give notice by first-class mail,
postage prepaid, to the Holders at least thirty (30) days prior to the proposed
Credit Issuance Date which notice shall be in substantially the form of Exhibit
C hereto, appropriately completed.
(d) Nonacceptance of Credit Facility. If the Company fails to
deliver to the Trustee, the Paying Agent and the Remarketing Agent by 10:00
a.m., Local Time, on the Credit Issuance Date (i) the opinions of Bond Counsel
and other Counsel required by subsection (a)(2) of this Section or (ii) evidence
that the anticipated ratings specified in the Trustee's notice to Holders
pursuant to subsection (c) of this Section have been received, the Trustee and
the Paying Agent shall not accept the Credit Facility, but all Bonds shall be
deemed to have been tendered for purchase on the proposed Credit Issuance Date
and shall be purchased on such date. The Trustee shall immediately notify by
telephone the Issuer
-27-
<PAGE> 32
and the Company if the Credit Facility is not accepted on the proposed Credit
Issuance Date.
(e) Failure to Mail Notice. Failure to mail the notice described
in subsection (c), or any defect therein, shall not affect the issuance of the
Credit Facility or extend the period for tendering any of the Bonds for
purchase, and the Trustee shall not be liable to any Holder by reason of its
failure to mail such notice or any defect therein.
Section 2.6. Tender of Bonds for Purchase.
(a) Optional Tender During Weekly Rate Period or Monthly Rate
Period. During any Weekly Rate Period or Monthly Rate Period, the Holders of the
Bonds shall have the right to tender any such Bond (or portion thereof in an
Authorized Denomination, provided that any Bond or portion thereof remaining is
also in an Authorized Denomination), for purchase on any Optional Tender Date,
but only upon:
(1) delivery to the Remarketing Agent at its principal office, not
later than 4:00 p.m., Local Time, on the seventh (7th) day (or on the
immediately preceding Business Day, if such seventh (7th) day is not a
Business Day) next preceding such Optional Tender Date, of an irrevocable
written, telephonic (followed, if requested by the Remarketing Agent, by
written or facsimile confirmation delivered to the Remarketing Agent no
later than the close of business on the next succeeding Business Day),
facsimile or telegraphic notice (with a written or facsimile copy to the
Tender Agent) stating (i) that such Holder will tender for purchase all
or any portion of his/her Bonds in an Authorized Denomination and the
amount of Bonds to be tendered and (ii) the Optional Tender Date on which
such Bonds will be tendered; and
(2) delivery of such Bond (with an appropriate instrument of
transfer duly executed in blank) to the Tender Agent at its principal
office at or prior to 10:00 a.m., Local Time, on such Optional Tender
Date; provided, however, that no Bond shall be purchased unless such Bond
as delivered to the Tender Agent shall conform in all respects to the
description thereof in the aforesaid notice.
(b) Optional Tender During Semiannual Rate Period. During any
Semiannual Rate Period, the Holders of the Bonds shall have the right to tender
any such Bond (or portion thereof in an Authorized Denomination, provided that
any Bond or portion thereof remaining is also in an Authorized Denomination) for
purchase on any Optional Tender Date, but only upon:
(1) delivery to the Remarketing Agent at its principal office, not
later than 4:00 p.m., Local Time, on the twentieth (20th) day (or on the
immediately preceding Business Day if such twentieth day is not a
Business Day) next preceding such Optional Tender Date of an irrevocable
written, telephonic
-28-
<PAGE> 33
(followed, if requested by the Remarketing Agent, by written or facsimile
confirmation delivered to the Remarketing Agent no later than the close
of business on the next succeeding Business Day), facsimile or
telegraphic notice (with a written or facsimile copy to the Tender Agent)
stating (i) that such Holder will tender for purchase all or any portion
of his/her Bonds in an Authorized Denomination and the amount of Bonds to
be tendered and (ii) the Optional Tender Date on which such Bonds will be
tendered; and
(2) the delivery of such Bond (with an appropriate instrument of
transfer duly executed in blank) to the Tender Agent at its principal
office at or prior to 10:00 a.m., Local Time, on such Optional Tender
Date; provided, however, that no Bond (or portion thereof) shall be
purchased unless such Bond as delivered to the Tender Agent shall conform
in all respects to the description thereof in the aforesaid notice.
(c) Election to Tender Irrevocable. Any election of a Holder to
tender Bonds for purchase on an Optional Tender Date in accordance with
subsection (a) or (b) above shall be irrevocable and shall be binding on the
Holder making such election and on any transferee of such Holder.
(d) Notices. The Remarketing Agent shall give the Tender Agent
prompt notice by telephone of receipt of (i) any tender notice received by it in
accordance with paragraph (1) of subsection (a) or (b) above, or (ii) any Credit
Issuance Notice received by it from the Company in accordance with Section
2.5(a). Upon the receipt of any such notice, the Tender Agent shall promptly
notify the Trustee, the Paying Agent and, except in the case of a notice
described in (ii) above, the Credit Issuer, if any, by telephone.
During any Semiannual Rate Period, the Tender Agent shall give
notice by first-class mail, postage prepaid, to Holders not more than thirty
(30) or less than twenty (20) days prior to each Optional Tender Date, which
notice shall state in substance (i) the next Optional Tender Date, (ii) the next
Proposed Rate Computation Date related thereto, (iii) that the Proposed Rate may
be obtained at the principal office of the Remarketing Agent on or after the
Proposed Rate Computation Date, and (iv) that the Bonds are subject to tender at
the option of the Holder thereof in the manner set forth in subsection (b) of
this Section.
(e) Mandatory Purchase on Conversion Date or on Credit
Modification Date or on Credit Issuance Date. The Bonds shall be subject to
mandatory tender for purchase on any Conversion Date, on any Credit Modification
Date and on any Credit Issuance Date at the Purchase Price thereof.
Notwithstanding the preceding sentence, there shall be no purchase pursuant to
this subsection of Bonds to be redeemed on the Mandatory Purchase Date, and
Bonds issued in exchange for or upon the registration of transfer of Bonds to be
redeemed on the Mandatory Purchase Date. Holders of Bonds shall
-29-
<PAGE> 34
tender such Bonds to the Tender Agent by 10:00 a.m., Local Time, on each
Mandatory Purchase Date.
(f) Bonds Deemed Tendered. If (1) with respect to a Mandatory
Purchase Date, a Holder fails to deliver such Bond to the Tender Agent on or
before the Mandatory Purchase Date, or (2) with respect to an Optional Tender
Date, a Holder gives notice pursuant to Section 2.6(a) or (b) to the Remarketing
Agent and thereafter fails to deliver such Bonds (or portion thereof) to the
Tender Agent, as required, then such Bond (or portion thereof), that is not
delivered to the Tender Agent, shall be deemed to have been properly tendered
(such Bond being hereinafter referred to as an "Untendered Bond") and, to the
extent that there shall be on deposit with the Paying Agent on the date purchase
thereof is required as provided herein an amount sufficient to pay the Purchase
Price thereof, such Untendered Bond shall cease to constitute or represent a
right to payment of principal or interest thereon and shall constitute and
represent only the right to the payment of the Purchase Price payable on such
date. The preceding sentence shall not limit the entitlement of any Holder on
any Record Date to receipt of interest due on such Mandatory Purchase Date or
Optional Tender Date, as the case may be.
(g) Source of Funds for Purchase of Bonds. On each Optional Tender
Date and each Mandatory Purchase Date there shall be purchased (but solely from
funds set forth below) the Bonds (or portions thereof), tendered (or deemed
tendered) to the Tender Agent for purchase in accordance with this section at
the applicable Purchase Price. Funds for the payment of the Purchase Price for
such Bonds (or portions thereof), shall be paid by the Paying Agent solely from
the following sources and in the following order of priority:
(1) moneys from the Bond Purchase Fund constituting Eligible
Funds, if any, under clauses (i) or (ii) of the definition of Eligible
Funds that have been transferred to the Paying Agent pursuant to Section
4.4;
(2) proceeds of the remarketing of such Bonds (or portions
thereof) pursuant to Section 2.7 that have been transferred to the Paying
Agent pursuant to said Section;
(3) if a Credit Facility is th6n in effect, moneys drawn under
such Credit Facility pursuant to Section 3.8(a)(ii); and
(4) any other moneys furnished by or on behalf of the Company for
purchase of Bonds.
Bonds (or portions thereof) purchased as provided above shall be
delivered as provided in Section 2.8.
(h) No Purchases During Certain Defaults. The Holders shall not
have the right or be required, as the case may be, to tender any Bond (or
portion thereof) for purchase on an Optional Tender Date or Mandatory Purchase
Date if on such date a Credit
-30-
<PAGE> 35
Facility is in effect and an Event of Default under Section 6.1 shall have
occurred and be continuing and as a result, the Trustee has declared the
principal and premium, if any, of the Bonds and the interest accrued thereon to
be immediately due and payable.
(i) Notice of Mandatory Purchase Date. Not less than thirty (30)
days prior to each Mandatory Purchase Date occurring as a result of a Credit
Modification Date, the Trustee shall give written notice of such Mandatory
Purchase Date to the Remarketing Agent, the Tender Agent, the Paying Agent and,
by first-class mail, postage prepaid, the Holders, which notice shall be in
substantially the form of Exhibit D hereto, appropriately completed. Failure to
mail such notice or any defect therein shall not affect the rights or
obligations of Holders and the Trustee shall not be liable to any Holder
byreason of its failure to mail such notice or any defect therein. With respect
to a Mandatory Purchase Date that is a Conversion Date, the Trustee shall
provide notice to the Holders as set forth in Section 2.4(d). With respect to a
Mandatory Purchase Date that is a Credit Issuance Date, the Trustee shall
provide notice to the Holders as set forth in Section 2.5(c).
(j) Purchase Notice. If the Bonds are held in a Book Entry System,
a purchase notice pursuant to Section 2.6(a)(1) may be delivered by a Beneficial
Owner. Such purchase notice must be delivered as set forth in Section 2.6(a)(1)
and must state that such Beneficial Owner will cause its beneficial interest (or
portion thereof in an Authorized Denomination) to be tendered, the amount of
such interest to be tendered, the Optional Tender Date on which such interest
will be tendered and the identity of the Participant through which the
Beneficial owner maintains its interest. Upon delivery of such notice, the
Beneficial Owner must make arrangements to have its beneficial ownership
interest in the Bonds being tendered transferred to the Tender Agent at or prior
to 10:00 a.m., on the Optional Tender Date, but need not otherwise comply with
Section 2.6(a)(2).
Section 2.7. Remarketing of Bonds.
(a) Beat Efforts to Place Bonds. The Remarketing Agent shall use
its best efforts to place Bonds (or portions thereof) at a price of par plus
accrued interest, if any, on each date that such Bonds (or portions thereof) are
required to be purchased pursuant to Section 2.6 and if such Bonds are not
placed on such date (such Bonds being hereinafter referred to as "Unremarketed
Bonds"), the Remarketing Agent shall continue, for a period not in excess of
thirty (30) days thereafter, to use its best efforts to place such Unremarketed
Bonds at a price of par plus accrued interest, if any. The Remarketing Agent
shall use its best efforts to place Unremarketed Bonds on a particular date that
is more than thirty (30) days after the date on which such Unremarketed Bonds
were tendered (or deemed tendered) for purchase and became Unremarketed Bonds
upon receipt by the Remarketing Agent and the Trustee by 10:00 a.m., Local Time,
on such date, of an Opinion of Bond Counsel to the effect that under the laws
existing on such
-31-
<PAGE> 36
date, the placement of such Unremarketed Bonds on such date will not adversely
affect the exclusion from gross income of interest on the Bonds for federal
income tax purposes. By 12:00 noon, Local Time, on the Business Day prior to
each date that the Bonds (or portions thereof) are required to be purchased
pursuant to Section 2.6, the Remarketing Agent shall give initial notice by
telephone (promptly confirmed by telecopy) of the principal amount of the Bonds
for which it has arranged placement, together with the principal amount of the
Bonds, if any (and such other particulars with respect thereto as the Trustee or
Tender Agent may deem necessary), for which it has not arranged placement, to
the Trustee, the Tender Agent, the Company, the Credit Issuer, if any, and the
Paying Agent.
Such initial notice shall be confirmed by telephone notice by 9:00
a.m., Local Time, on the date that such Bonds are to be purchased (such notice
to be promptly confirmed in writing) of the amount of Bonds not remarketed and
the information necessary to enable the Trustee to prepare new Bond certificates
with respect to the Bonds that were remarketed. By 9:30 a.m., Local Time, the
Remarketing Agent shall transfer to the Paying Agent the proceeds of the
remarketing of such Bonds.
Notwithstanding anything herein to the contrary, Bonds may be
remarketed only at a price of par.
(b) Draws on Credit Facility. In the event that moneys from the
sources described in Section 2.6(g)(1) and (2) are insufficient to pay the
Purchase Price of Bonds tendered or deemed tendered on an Optional Tender Date
or a Mandatory Purchase Date, the Trustee shall, by 11:00 a.m., Local Time, on
such Optional Tender Date or Mandatory Purchase Date, take all action required
to cause the Purchase Price of such Bonds, to the extent not available from the
sources described in Section 2.6(g)(1) and (2), to be paid from the Credit
Facility. In the event the Purchase Price of Bonds is paid from the Credit
Facility as described herein, and the Company does not reimburse the Credit
Issuer for such Purchase Price, upon the remarketing of such Bonds as described
in Section 2.7 (a), the Paying Agent shall deliver the proceeds of the
remarketing of such Bonds to the Credit Issuer.
(c) No Remarketing During Default. The Remarketing Agent shall not
be required to remarket any Bonds pursuant to this Section if it has actual
knowledge that an Event of Default shall have occurred and be continuing
hereunder or if the Remarketing Agent determines, in its sole discretion, that
the remarketing of the Bonds would be unlawful or would be likely to result in
the imposition of liability or damages against the Issuer, the Remarketing
Agent, the Paying Agent, the Tender Agent, the Trustee, the Credit Issuer, if
any, or the Company.
(d) Remarketing to Company or Issuer. If a Credit Facility is then
in effect, the Remarketing Agent shall not remarket any Bonds to the Company or
the Issuer or knowingly remarket any Bonds to an "insider" with respect to the
Issuer or
-32-
<PAGE> 37
the Company within the meaning of Title 11 of the United States Code or to any
other Person obligated (as guarantor or otherwise) to make payments on the Bonds
or under the Agreement or under the Credit Agreement pursuant to this Section
prior to the expiration or earlier termination of the Credit Facility unless
prior to such remarketing, the Trustee, the Rating Agency, if any, rating the
Bonds' and the Remarketing Agent shall have received - an unqualified opinion of
Counsel experienced in bankruptcy law matters to the effect that such placement
would not result in a preferential payment pursuant to the provisions of Section
547 of the United States Bankruptcy Code, 11 U.S.C. Section 101 et seq. upon an
Act of Bankruptcy, and if a Rating Agency is rating the Bonds, such Rating
Agency has confirmed to the Trustee in writing that its rating will not be
withdrawn or reduced as a result of such remarketing.
(e) Notice to Proposed Purchasers of Bonds. The Remarketing Agent
will give any Person to whom Bonds are proposed to be remarketed written notice
of any Mandatory Purchase Date, acceleration of maturity of Bonds or redemption
of Bonds, notice of which has been given to Holders, prior to remarketing Bonds
to such Person.
(f) No Remarketing Under Certain Conditions. Notwithstanding
anything to the contrary herein provided, the Bonds shall not be remarketed
unless (i) a Credit Facility providing for the payment of the principal of and
interest on, and Purchase Price of, the Bonds will be in effect following the
remarketing of such Bonds, (ii) no such Credit Facility will be in effect, but
at the time of such remarketing, the Bonds are rated by a Rating Agency and such
long-term and/or short-term rating is satisfactory to the Remarketing Agent in
its sole discretion, or (iii) no such Credit Facility will be in effect, but
following the remarketing of such Bonds, the Bonds will bear interest at a Long
Term Rate.
Section 2.8. Delivery of Purchased Bonds. Bonds (or portions
thereof) purchased pursuant to Section 2.6 shall be delivered as follows:
(a) Bonds Purchased from Remarketing Proceeds. Bonds purchased
with moneys described in Section 2.6(g)(2) shall be delivered to the purchasers
thereof upon receipt of payment therefor. Prior to such delivery the Registrar
shall provide for registration of transfer to the Holders, as provided in a
written notice from the Remarketing Agent.
(b) Bonds Purchased from Draws Under Credit Facility. Bonds (or
portions thereof) purchased with moneys drawn under the Credit Facility shall be
surrendered to the Trustee for registration of transfer to the Company and upon
such registration of transfer, the Bonds issued in respect thereof shall be (i)
delivered to and held by the Trustee for the account of the Company, and no such
Bond shall be released, pledged or otherwise transferred or disposed of until
the Trustee shall have received written notice from the Credit Issuer that the
amounts so drawn under the Credit Facility, together with interest thereon, if
any, due pursuant to any Credit Agreement, have been reimbursed to the Credit
Issuer and that the amount so drawn
-33-
<PAGE> 38
under the Credit Facility with respect to such Bonds has been, or upon such
release will be, correspondingly and fully reinstated, and thereupon shall be
delivered to, or in accordance with the written direction of, the Company or
(ii) if required pursuant to any Credit Agreement, issued to a pledge agent for
the account of the Credit Issuer as pledgee of such Bonds and no such Bond shall
be released, pledged or otherwise transferred or disposed of until the Trustee
shall have received written notice from the Credit Issuer that the amounts so
drawn under the Credit Facility, together with interest thereon, if any, due
pursuant to any Credit Agreement, have been reimbursed to the Credit Issuer and
that the amount so drawn under the Credit Facility with respect to such Bonds
has been, or upon such release will be, correspondingly and fully reinstated.
(c) Bonds Purchased with Other Moneys. Bonds (or portions thereof)
purchased with any other moneys pursuant to Section 2.6(g) shall be delivered to
the Trustee for cancellation and shall be cancelled.
(d) During Book Entry System. Notwithstanding anything herein to
the contrary, so long as the Bonds are held under the Book Entry System, Bonds
will not be delivered as set forth in (a) - (c) above; rather, transfers of
beneficial ownership of the Bonds to the persons indicated above will be
effected on the books of the Securities Depository pursuant to its rules and
procedures.
Section 2.9. Execution Limited Obligation. The Bonds shall be
executed on behalf of the Issuer by the manual or facsimile signature of the
Chairman or Vice Chairman of the Issuer and attested by the manual or facsimile
signature of the Secretary of the Issuer and shall have impressed or imprinted
thereon the seal (or a facsimile thereof), if any, of the Issuer.
In case the Chairman or Vice Chairman or the Secretary whose
manual or facsimile signature shall appear on the Bonds shall cease to be such
Chairman or Vice Chairman or Secretary before the delivery of such Bonds, such
manual or facsimile signatures shall nevertheless be valid and sufficient for
all purposes.
The Bonds shall be limited obligations of the Issuer. The Bonds
and the interest thereon and redemption premium, if any, shall not be deemed to
constitute or create an indebtedness, liability or obligation of the Issuer, the
State of Iowa or any political subdivision or agency thereof within the meaning
of any State constitutional provision or statutory limitation or a pledge of the
faith and credit or the taxing power of the State of Iowa or any such political
subdivision or agency. The Bonds and the interest thereon are payable solely
from and secured by the Security, including the moneys available to be drawn by
the Trustee under any Credit Facility that may be in effect from time to time to
support payments due on or with respect to the Bonds, all as described in and
subject to limitations set forth in this
-34-
<PAGE> 39
Indenture, for the equal and ratable benefit of the Holders, from time to time,
of the Bonds.
Section 2.10. Certificate of Authentication. No Bonds shall be
secured hereby or entitled to the benefit hereof or shall be or become valid or
obligatory for any purpose unless there shall be endorsed thereon a certificate
of authentication, substantially in the form as set forth in the form of Bond
referred to in Section 2.11, executed by an officer of the Trustee; and such
certificate on any Bond issued by the Issuer shall be conclusive evidence and
the only competent evidence that it has been duly authenticated and delivered
hereunder.
Section 2.11. Form of Bonds.
The Bonds, the Trustee's certificate of authentication and the
form of assignment shall be in substantially the form set forth as Exhibit A
hereto, with such appropriate variations, omissions, substitutions and
insertions as are permitted or required hereby or are required by law and may
have such letters, numbers or other marks of identification and such legends and
endorsements placed thereon as may be required to comply with any applicable
laws or rules or regulations, or as may, consistent herewith, be determined by
the officers of the Issuer executing such Bonds, as evidenced by their execution
of the Bonds.
The Bonds shall be in either typewritten or printed form, as the
Company shall direct, on behalf of the Issuer, with approval of the Trustee;
provided that any expenses, including but not limited to expenses of printing,
incurred in connection therewith shall be paid by the Company.
On and after any Mandatory Purchase Date, Bonds authenticated and
delivered hereunder shall have omitted from the text thereof such provisions
contained in the form of the Bonds set forth as Exhibit A hereto as are not
applicable to the Bonds on and after such date or shall include such provisions
as will become applicable after such date including without limitation, any
reference to entitlement to any benefit of the Credit Facility, if then in
effect, and any redemption provisions made applicable as a result of the
occurrence of a Conversion Date relating to a conversion to a Long-Term Rate.
Section 2.12. Delivery of Bonds. Upon the execution and delivery
hereof, the Issuer shall execute the Bonds and deliver them to the Trustee, and
the Trustee shall authenticate the Bonds and deliver them to such purchaser or
purchasers as shall be directed in writing by the Issuer as hereinafter in this
Section provided.
Prior to the direction by the Issuer to the Trustee to deliver any
of the Bonds there shall be filed with the Trustee:
-35-
<PAGE> 40
(a) A certified copy of all resolutions adopted and proceedings
had by the issuer authorizing execution of the Indenture and the Agreement and
the issuance of the Bonds;
(b) An original executed counterpart of this Indenture, the
Remarketing Agreement, the Credit Agreement, the Agreement and the Placement
Agreement;
(c) The original executed Original Credit Facility, if a Credit
Facility is to be issued on the Issue Date;
(d) Copies of any Financing Statements filed to perfect the
security interests in the Security;
(e) A copy of completed IRS Form 8038 to be filed by or on behalf
of the Issuer pursuant to Section 149(e) of the Code;
(f) An original executed counterpart of the certificate of the
Issuer establishing its reasonable expectations to the effect that the Bonds
will not be "arbitrage bonds" within the meaning of Section 148 of the Code;
(g) An opinion of Counsel to the effect that this Indenture, the
Placement Agreement and the Agreement have been duly authorized, executed and
delivered by the Issuer and are legal, valid and binding agreements of the
Issuer and an approving Opinion of Bond Counsel that interest on the Bonds will
not be included in gross income for federal income tax purposes;
(h) An opinion of Counsel f or the Company to the effect that the
Agreement, the Remarketing Agreement and the Placement Agreement have been duly
authorized, executed and delivered by the Company and are legal, valid and
binding agreements of the Company;
(i) An opinion of Counsel for the Credit Issuer of the Original
Credit Facility, if any, addressed to the Issuer, the Company, the Remarketing
Agent, the Trustee and the Paying Agent to the effect that the Original Credit
Facility has been duly executed and delivered by the Credit Issuer and is a
legal, valid and binding obligation of the Credit Issuer or, if the original
Credit Facility is issued by a branch or agency of a foreign commercial bank, to
the effect that the original Credit Facility is the legal, valid and binding
obligation of such branch or agency and there shall also be delivered an opinion
of Counsel licensed to practice law in the jurisdiction in which the main office
of such bank is located, satisfactory to the Trustee, to the effect that such
Original Credit Facility has been duly executed and delivered by such branch or
agency and is the legal, valid and binding obligation of such bank; and
(j) A request and authorization to the Trustee on behalf of the
Issuer and signed by a duly authorized officer of the Issuer directing the
Trustee to authenticate and deliver the Bonds in such specified denominations as
permitted herein to the initial
-36-
<PAGE> 41
purchaser or purchasers upon payment to the Trustee, but for the account of the
Issuer, of a specified sum of money.
Upon receipt of the foregoing, the Trustee shall authenticate and
deliver the Bonds as provided above.
Section 2.13. Mutilated, Lost, Stolen or Destroyed Bonds. If any
Bond is mutilated, lost, stolen or destroyed, the Issuer may execute and the
Trustee may authenticate and deliver a new Bond of the same maturity, interest
rate, principal amount and tenor in lieu of and in substitution for the Bond
mutilated, lost, stolen or destroyed; provided, that there shall be first
furnished to the Trustee evidence satisfactory to it and the Issuer of the
ownership of such Bond and of such loss, theft or destruction (or, in the case
of a mutilated Bond, such mutilated Bond shall first be surrendered to the
Trustee), together with indemnity satisfactory to the Trustee and the Issuer and
compliance with such other reasonable regulations as the Issuer and the Trustee
may prescribe. If any such Bond shall have matured or a redemption date
pertaining thereto shall have passed, instead of issuing a new Bond the Issuer
may pay the same without surrender thereof. The Issuer and the Trustee may
charge the Holder of such Bond with their reasonable fees and expenses in this
connection.
Section 2.14. Exchangeability and Transfer of Bonds; Persons
Treated as Owners. Books for the registration of the Bonds and for the
registration of transfer of the Bonds as provided herein shall be kept by the
Registrar.
Any Holder of a Bond, in person or by his/her duly authorized
attorney, may transfer title to his/her Bond on the Register upon surrender
thereof at the principal office of the Trustee, and by providing the Registrar
with a written instrument of transfer (in substantially the form of assignment
attached to the Bond) executed by the Holder or his/her duly authorized
attorney, and thereupon, the Issuer shall execute and the Trustee shall
authenticate and deliver in the name of the transferee or transferees a new Bond
or Bonds of the same aggregate principal amount and tenor as the Bond
surrendered (or for which transfer of registration has been effected) and of any
Authorized Denomination or Authorized Denominations.
Bonds may be exchanged upon surrender thereof at the principal
office of the Registrar with a written instrument of transfer satisfactory to
the Registrar executed by the Holder or such Holder's attorney duly authorized
in writing, for an equal aggregate principal amount of Bonds of the same tenor
as the Bonds being exchanged and of any Authorized Denomination or Authorized
Denominations. The Issuer shall execute and the Trustee shall authenticate and
deliver Bonds that the Holder making the exchange is entitled to receive,
bearing numbers not contemporaneously then outstanding.
Such registrations of transfer or exchanges of Bonds shall be
without charge to the Holders of such Bonds, but any taxes
-37-
<PAGE> 42
or other governmental charges required to be paid with respect to the same shall
be paid by the Holder of the Bond requesting such registration of transfer or
exchange as a condition precedent to the exercise of such privilege. Any service
charge made by the Registrar for any such registration of transfer or exchange
and all reasonable expenses of the Issuer and the Trustee shall be paid by the
Company.
The Registrar shall not register any transfer of any Bond, except
pursuant to a tender of Bonds on an Optional Tender Date or a Mandatory Purchase
Date, after notice calling such Bond (or portion thereof) for redemption has
been given and prior to such redemption, except in the case of any Bond to be
redeemed in part, the portion thereof not to be redeemed. In connection with any
such transfer pursuant to a tender of Bonds on an Optional Tender Date or a
Mandatory Purchase Date, the Registrar shall deliver to the transferee a copy of
the applicable notice of redemption.
The person in whose name any Bond shall be registered shall be
deemed and regarded as the absolute owner thereof for all purposes, and payment
of or on account of either principal or interest shall be made only to or upon
the order of the registered owner thereof or his/her duly authorized attorney,
but such registration may be changed as hereinabove provided. All such payments
shall be valid and effectual to satisfy and discharge the liability upon such
Bond to the extent of the sum or sums so paid.
All Bonds issued upon any registration of transfer or exchange of
Bonds shall be legal, valid and binding limited obligations of the Issuer,
evidencing the same debt, and entitled to the same security and benefits under
this Indenture, as the Bonds surrendered upon such registration of transfer or
exchange.
Notwithstanding the foregoing, for so long as the Bonds are held
under the Book Entry System, transfers of beneficial ownership will be effected
pursuant to rules and procedures established by the Securities Depository.
Section 2.15. Replacement Bonds. Except when the Bonds are held in
the Book Entry System, the Issuer shall execute and the Trustee shall
authenticate and deliver Replacement Bonds to replace Untendered Bonds. Any such
Replacement Bond shall be executed and authenticated as provided in this
Indenture. The Company shall bear all expenses in connection with the
preparation and delivery of the Replacement Bonds.
Section 2.16. Cancellation. All Bonds that have been surrendered
to the Registrar pursuant to Section 2.13, 2.14 or 2.15 of this Indenture or for
the purpose of purchase upon an Optional Tender Date or a Mandatory Purchase
Date, or for payment upon maturity or redemption prior to maturity, shall be
cancelled and destroyed by the Registrar and a certificate of destruction shall
be delivered to the Issuer.
-38-
<PAGE> 43
Section 2.17. Ratably Secured. All Bonds issued hereunder are and
are to be, to the extent provided in this Indenture equally and ratably secured
by this Indenture without preference, priority or distinction on account of the
actual time or times of the authentication, delivery or maturity of the Bonds so
that subject as aforesaid, all Bonds at any time Outstanding shall have the same
right, lien and preference under and by virtue of this Indenture and shall all
be equally and ratably secured hereby with like effect as if they had all been
executed, authenticated and delivered simultaneously on the date hereof, whether
the same, or any of them, shall actually be disposed of at such date, or whether
they, or any of them, shall be disposed of at some future date. Notwithstanding
the foregoing, any Bond that is registered in the name of the Company or held or
required to be held by the Trustee or any pledge agent under a pledge agreement
pursuant to Section 2.8 shall not be entitled to any benefit of the Credit
Facility, if any.
Section 2.18. Redemption of Bonds: Partial Redemption of Bonds.
(a) Optional Redemption. During any Weekly Rate Period, the Bonds
are subject to redemption, at the direction of the Company, in whole on any
Business Day or in part on any Interest Payment Date at a redemption price equal
to the principal amount of the Bonds to be redeemed plus accrued interest
thereon to the redemption date.
During any Monthly Rate Period the Bonds are subject to
redemption, at the direction of the Company, in whole on the first Business Day
of any calendar month or in part on any Interest Payment Date at a redemption
price equal to the principal amount of the Bonds to be redeemed plus accrued
interest thereon to the redemption date.
During any Money Market Rate Period with respect to which the
applicable Money Market Rate Index is based on money market instruments not
having a fixed maturity and the interest rate on which may change at any time,
the Bonds are subject to redemption, at the direction of the Company, in whole
on any Business Day or in part on any Interest Payment Date, at a redemption
price equal to the principal amount of the Bonds to be redeemed plus accrued
interest thereon to the redemption date.
During any Money Market Rate Period with respect to which the
applicable Money Market Rate Index is based on money market instruments with a
fixed maturity or the interest rate on which may be changed only on a fixed
reset date, the Bonds are subject to redemption, at the direction of the
Company, in whole on any such maturity date or fixed reset date or in part on
any Interest Payment Date, at a redemption price equal to the principal amount
of the Bonds to be redeemed plus accrued interest thereon to the redemption
date.
-39-
<PAGE> 44
During any Semiannual Rate Period the Bonds are subject to
redemption, at the direction of the Company, in whole or in part, on any
Interest Payment Date, at a redemption price equal to the principal amount of
the Bonds to be redeemed plus accrued interest thereon to the redemption date.
During any Long-Term Rate Period, the Bonds are subject to
redemption, at the direction of the Company, in whole or in part on any Interest
Payment Date occurring on or after the First Day of Redemption Period as
described below, at the principal amount thereof, plus a redemption premium
(expressed as a percentage of principal amount) plus accrued interest thereon to
the redemption date as follows, provided, however, such redemption premium shall
be paid only from Eligible Funds described in subparts (i) and (ii) of the
definition of Eligible Funds on deposit in the Bond Fund, and such Eligible
Funds must be sufficient to pay such redemption premium without any draw on any
Credit Facility then in effect unless such Credit Facility provides for payment
of such premium:
<TABLE>
<CAPTION>
Length of Long-
Term Rate Period
From Conversion
Date Until End Redemption Premium
of Rate Period as a Percentage of
(Expressed in First Day of Principal Amount
Years) Redemption Period of Bonds
---------------- ----------------- ------------------
<S> <C> <C>
More than 15 10th Anniversary 3% declining by
of Conversion 1% every year
Date after the 10th Anni-
versary of the Con-
version Date until
reaching 0%, and
thereafter 0%
More than 10 7th Anniversary 3% declining by
but not more of Conversion 1% every year
than 15 Date after the 7th Anni-
versary of the Con-
version Date until
reaching 0%, and
thereafter 0%
More than 7 5th Anniversary 2% declining by
but not more of Conversion 1% every year
than 10 Date after the 5th Anni-
versary of the Con-
version Date until
reaching 0%, and
thereafter 0%
More than 5 4th Anniversary 1% declining by
but not more of Conversion 1% to 0% the first
than 7 Date year after the 4th
Anniversary of the
</TABLE>
-40-
<PAGE> 45
<TABLE>
<S> <C> <C>
5 or less Bonds not redeemable Conversion Date, and
pursuant to thereafter 0%
this paragraph
</TABLE>
The above premiums may be changed upon the conversion to a
Long-Term Rate upon the receipt of an opinion of Bond Counsel subject to and in
accordance with the provisions of Sections 2.3(f) and 2.3(g).
(b) Extraordinary Optional Redemption. The Bonds are subject to
redemption in whole, at the direction of the Company, at a redemption price
equal to 100% of the principal amount of the Bonds to be redeemed plus accrued
interest thereon to the redemption date, on any date for which the requisite
notice of redemption can be given, within one hundred eighty (180) days of the
occurrence of any of the following events:
(i) the Project shall have been damaged or destroyed to such an
extent that in the judgment of the Company (A) it cannot
reasonably be restored within a period of three (3) consecutive
months to the condition thereof immediately preceding such damage
or destruction, (B) the Company is thereby prevented from carrying
on its normal operations at the Project for a period of three (3)
consecutive months, or (C) it would not be economically feasible
for the Company to replace, repair, rebuild or restore the same;
(ii) title in and to, or the temporary use of, all or
substantially all of the Project shall have been taken under the
exercise of the power of eminent domain by any governmental
authority or any Person acting under governmental authority
(including such a taking as, in the judgment of the Company,
results in the Company being prevented thereby from carrying on
its normal operations at the Project for a period of three (3)
consecutive months);
(iii) as a result of any changes in the Constitution of the State,
or the Constitution of the United States of America or by
legislative or administrative action (whether state or federal) or
by final decree, judgment, decision or order of any court or
administrative body (whether state or federal), the Agreement
shall have become void or unenforceable or impossible of
performance in accordance with the intent and purpose of the
parties as expressed therein;
(iv) unreasonable burdens or excessive liabilities shall have been
imposed on the Company with respect to the operations of the
Project, including, without limitation
-41-
<PAGE> 46
federal, state or other ad valorem, property, income or other
taxes not being imposed on the date of this indenture that, in the
judgment of the Company, render the continued operation of the
Project uneconomical;
(v) changes which the Company cannot reasonably control or
overcome in the economic availability of materials, supplies,
labor, equipment and other properties and things necessary for the
efficient operation of the Project for the purposes contemplated
by the Agreement shall have occurred or technological changes that
the Company cannot reasonably overcome shall have occurred that,
in the judgment of the Company render the continued operation of
the Project uneconomical;
(vi) legal curtailment of the Company's use and occupancy of all
or substantially all of the Project for any reason other than that
set forth in (ii) above, which curtailment shall, in the judgment
of the Company, prevent the company from carrying on its normal
operations at the Project for a period of three (3) consecutive
months; or
(vii) the Agreement is terminated prior to its expiration for any
reason other than the occurrence of an Event of Default under the
Agreement.
(c) Mandatory Redemption. The Bonds are subject to mandatory
redemption in whole at a redemption price equal to 100% of the principal amount
of the Bonds to be redeemed plus accrued interest thereon to the redemption date
(and not including any premium that might otherwise be payable during any
Long-Term Rate Period) on any Business Day for which the requisite notice of
redemption can be given (i) within forty-five (45) days after the occurrence of
a Determination of Taxability, and (ii) within forty-five (45) days after the
failure of the Trustee to receive the opinion of Bond Counsel described in
Section 2.3(l); provided, however, if mandatory redemption on account of a
Determination of Taxability of less than all the Bonds would result, in the
Opinion of Bond Counsel, in the interest on the Bonds Outstanding following such
mandatory redemption not being includable in the gross income of the owners of
such Bonds outstanding, then the Bonds are subject to mandatory redemption upon
the occurrence of a Determination of Taxability in the amount specified in such
opinion, provided that such redemption must be in an Authorized Denomination.
(d) Selection of Bonds to be Redeemed. If less than all the
Outstanding Bonds shall be called for redemption, the Registrar or, if the Bonds
are held in the Book Entry System, the Securities Depository shall first select
and call for redemption Bonds held by the Trustee or a pledge agent for the
account of the Company and pledged to the Credit Issuer as contemplated in
Section 2.8(b). If, following such selection, additional Bonds must be selected
and called for redemption, the Registrar or, if the Bonds are held in the Book
Entry System, the Securities Depository shall select or
-42-
<PAGE> 47
arrange for the selection, in such manner as it shall deem fair and equitable
and pursuant to its rules and procedures, the Bonds, in Authorized
Denominations, provided that any Bond or portion thereof remaining Outstanding
shall be in an Authorized Denomination. If there shall be called for redemption
less than the principal amount of a Bond, the Issuer shall execute and the
Trustee shall authenticate and deliver, upon surrender of such Bond, without
charge to the Holder thereof in exchange for the unredeemed principal amount of
such Bond at the option of such Holder, Bonds in any of the Authorized
Denominations or, if the Bonds are held in the Book Entry System, the Securities
Depository shall, acting pursuant to its rules and procedures, reflect in said
system the partial redemption and the Trustee shall (i) either exchange the Bond
or Bonds held by the Securities Depository for a new Bond or Bonds in the
appropriate principal amount, if such Bond is presented to the Trustee by the
Securities Depository, or (ii) obtain from the Securities Depository a written
confirmation of the reduction in the principal amount of the Bonds held by such
Securities Depository.
Section 2.19. Notice of Redemption. The Company shall exercise its
option to prepay Repayments (and thereby cause a redemption of Bonds) by giving
written notice to the Remarketing Agent, the Trustee, the Paying Agent and the
Credit Issuer, if a Credit Facility is then in effect, not less than forty-five
(45) days prior to the date selected for redemption; provided, however, that, if
such redemption is pursuant to Section 2.18(b), the Company shall also deliver a
certificate of an Authorized Representative certifying that the conditions
precedent to such redemption have been met. To exercise any optional redemption
pursuant to Section 2.18(a) so long as a Credit Facility is in effect, then at
least one day before the Trustee is to give notice of such redemption, the
Trustee must have received written consent from the Credit Issuer to a draw on
the Credit Facility in the amount of such redemption price to the extent moneys
in the Bond Fund constituting Eligible Funds under clauses (i), (ii) and (iv) of
the definition of Eligible Funds will not be available therefor on the date of
such redemption. Notice of redemption shall be mailed by the Trustee by
first-class mail, postage prepaid, at least thirty (30) days before the
redemption date to each Holder of the Bonds to be redeemed in whole or in part
at his/her last address appearing on the Register, but no defect in or failure
to give such notice of redemption shall affect the validity of the redemption.
All Bonds so called for redemption will cease to bear interest on the date fixed
for redemption, provided funds for their redemption have been duly deposited
with the Trustee and, thereafter, the Holders of such Bonds called for
redemption shall have no rights in respect thereof except to receive payment of
the redemption price from the Trustee and a new Bond for any portion not
redeemed.
Section 2.20. Book Entry System. The Bonds shall be initially
issued pursuant to a Book Entry System administered by the Securities Depository
with no physical distribution of Bond certificates to be made except as provided
in this Section 2.20.
-43-
<PAGE> 48
Any provision of this Indenture or the Bonds requiring physical delivery of the
Bonds shall, with respect to any Bonds held under the Book Entry System, be
deemed to be satisfied by a notation on he Register maintained by the Registrar
that such Bonds are subject to the Book Entry System.
So long as a Book Entry System is being used, one Bond in the
aggregate principal amount of the Bonds and registered in the name of the
Securities Depository Nominee will be issued and deposited with the Securities
Depository and held in its custody. The Book Entry System will be maintained by
the Securities Depository and the Participants and Indirect Participants and
will evidence beneficial ownership of the Bonds in Authorized Denominations,
with registration of transfers of ownership effected on the records of the
Securities Depository, the Participants and the Indirect Participants pursuant
to rules and procedures established by the Securities Depository, the
Participants and the Indirect Participants. The principal of and any premium on
each Bond shall be payable to the Securities Depository Nominee or any other
person appearing on the Register as the registered Holder of such Bond or
his/her registered assigns or legal representative at the principal office of
the Registrar. So long as the Book Entry System is in effect, the Securities
Depository will be recognized as the Holder of the Bonds for all purposes
(except as provided in Section 2.6 (j)). Transfer of principal, interest and any
premium payments or notices to Participants and Indirect Participants will be
the responsibility of the Securities Depository, and transfer of principal,
interest and any premium payments or notices to Beneficial Owners will be the
responsibility of the Participants and the Indirect Participants. No other party
will be responsible or liable for such transfers of payments or notices or for
maintaining, supervising or reviewing such records maintained by the Securities
Depository, the Participants or the Indirect Participants. While the Securities
Depository Nominee or the Securities Depository, as the case may be, is the
registered owner of the Bonds, notwithstanding any other provisions set forth
herein, payments of principal of, redemption premium, if any, and interest on
the Bonds shall be made to the Securities Depository Nominee or the Securities
Depository, as the case may be, by wire transfer in immediately available funds
to the account of said Holder as may be specified in the Register maintained by
the Registrar or by such other method of payment as the Trustee may determine to
be necessary or advisable with the concurrence of the Securities Depository.
In the event that (i) the Securities Depository determines not to
continue to administer a Book Entry System for the Bonds, or (ii) the Company,
with the consent of the Trustee and the Remarketing Agent, determines that
continuation of a Book Entry System of evidence and transfer of ownership of the
Bonds would adversely affect the interests of the Beneficial owners, the Book
Entry System will be discontinued if the Company, with the consent of the
Trustee and the Remarketing Agent, fails to replace or removes the then-acting
Securities Depository, in which case the Trustee will deliver replacement Bonds
in the form of fully
-44-
<PAGE> 49
registered certificates in Authorized Denominations in exchange for the
Outstanding Bonds as required by the Trustee and the Beneficial Owners.
The Securities Depository may be removed at any time at the
election of the Remarketing Agent, with the consent of the Trustee, and a new
Securities Depository may thereupon be appointed by the Remarketing Agent,
subject to the approval of the Trustee.
ARTICLE III
SECURITY
Section 3.1. Security. The Bonds and the interest and any premium
thereon shall be a limited obligation of the Issuer as provided in Section 2.9,
and shall be secured by and payable from and the Issuer hereby pledges and
assigns to the Trustee as such security the following:
(i) all Repayments received by the Issuer under the Agreement,
which Repayments are to be paid directly by the Company to the
Trustee and deposited in the Bond Fund or the Bond Purchase Fund
in accordance with this Indenture;
(ii) all moneys in the Bond Fund, the Bond Purchase Fund, the
Surplus Fund and the Initial Fund, including the proceeds of the
Bonds pending disbursement thereof;
(iii) all of the Issuer's rights, title and interest in the
Agreement, except Reserved Rights;
(iv) all other rights and interests granted to the Issuer in
connection with the Agreement (except Reserved Rights) as set
forth herein or granted directly to the Trustee as provided
herein; and
(v) all of the proceeds of the foregoing (except the amounts
payable to or on behalf of the Issuer on account of its Reserved
Rights), including without limitation investments thereof.
The foregoing are collectively the "Security" and, in consideration of the
purchase of the Bonds and to secure payment of the principal of, premium, if
any, and interest on the Bonds and any other cost or pecuniary liability of the
Issuer relating to the Bonds or any proceeding, document or certification
incidental to the issuance of the Bonds, and to secure performance and
observance of all covenants, terms and conditions upon which the Bonds are to be
issued, including without limitation this Indenture, the Issuer, without
recourse, representation or warranty, pursuant to law hereby conveys, assigns
and pledges all of its right, title and interest in, and grants a security
interest in, the Security to the Trustee, and its successors and assigns, in
trust for the benefit
-45-
<PAGE> 50
of the Holders, and their successors and assigns. For reference purposes, any
Credit Facility shall be deemed a part of the Security during any period during
which it is in effect.
Section 3.2. Payment of Bonds and Performance of Covenants. The
Issuer shall promptly pay, but only out of the Security, the principal of,
premium, if any, and interest on the Bonds at the place, on the dates and in the
manner provided in the Bonds. The Issuer shall promptly perform and observe all
covenants, undertakings and obligations set forth herein, in the Agreement or
the Bonds on its part to be performed or observed. The Issuer shall fully
cooperate with the Trustee in the enforcement by the Trustee of any such rights
granted to the Issuer under the Agreement.
Section 3.3. Authority. The Issuer represents and warrants that
(i) it is duly authorized under the Constitution and laws of the State to issue
the Bonds, and to execute, deliver and perform the terms of the Agreement and
this Indenture; (ii) all action on its part for the issuance of the Bonds and
execution and delivery of the Agreement and this Indenture has been duly taken;
(iii) the Bonds, upon issuance and authentication, and the Agreement and this
Indenture upon delivery, assuming that they are the respective legal, valid,
binding and enforceable obligations of the other parties thereto, shall be valid
and enforceable obligations of the Issuer in accordance with their terms, except
as enforceability may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally and general equitable
principles; (iv) it has not heretofore conveyed, assigned, pledged, granted a
security interest in or otherwise disposed of the Security; (v) it has not
received any payments under the Agreement; (vi) without making any independent
investigation, it has no knowledge of any right of set-off, defense or
counterclaim to payment or performance of the terms or conditions of the
Agreement; and (vii) the execution, delivery and performance of the Agreement
and this Indenture and issuance of the Bonds are not in contravention of law or
any agreement, instrument, indenture or other undertaking to which it is a party
or by which it is bound and no other approval, consent or notice from any
governmental agency is required on the part of the Issuer.
Section 3.4. No Litigation. The Issuer represents and warrants
that (i) no litigation or administrative action of any nature is now pending to
restrain or enjoin the issuance or delivery of the Bonds or the execution and
delivery by the Issuer of this Indenture or the Agreement or in any manner
questioning the proceedings or authority under which the same have been
effected, or affecting the validity of the same; (ii) no contest is pending that
is material to the validity or enforceability of the Bonds, this Indenture or
the Agreement or that contests the Issuer's existence, or the authority of its
present members, elected officials or officers; (iii) no authority or proceeding
for the issuance of the Bonds or for the payment or security thereof has been
repealed, revoked or rescinded; and (iv) to the best of its knowledge, none of
the foregoing actions is threatened.
-46-
<PAGE> 51
Section 3.5. Further Assurances. Subject to the provisions of
Section 9.9, the Issuer covenants that it will cooperate to the extent necessary
with the Company, the Trustee and any Credit Issuer in their defenses of the
Security against the claims and demands of all Persons and, upon payment or
provision for payment of the fees and expenses to be incurred by the Issuer in
connection therewith, will do, execute, acknowledge and deliver or cause to be
done, executed, acknowledged and delivered such indentures supplemental hereto
and such further acts, instruments and transfers as the Trustee or any Credit
Issuer may reasonably require for the better pledging of the Security. Subject
to the provisions of Section 9.9, the Issuer shall not cause or permit to exist
any amendment, modification, supplement, waiver or consent with respect to the
Agreement without the prior written consent of the Trustee, which consent shall
be governed by Article VIII.
Section 3.6. No Other Encumbrances. The Issuer covenants that,
except as otherwise provided herein and in the Agreement, it will. not sell,
convey, mortgage, encumber or otherwise dispose of any portion of the Security.
Section 3.7. No Personal Liability. No recourse shall be had for
the enforcement of any obligation, promise or agreement of the Issuer contained
herein or in the Bonds or the other Bond Documents to which the Issuer is a
party or for any claim based hereon or thereon or otherwise in respect hereof or
thereof against any director, member, officer, agent, attorney or employee, as
such, in his/her individual capacity, past, present or future, of the Issuer or
of any successor entity, either directly or through the Issuer or any successor
entity whether by virtue of any constitutional provision, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise. No
personal liability whatsoever shall attach to, or be incurred by, any member,
officer, agent, attorney or employee as such, past, present or future, of the
Issuer or of any successor entity, either directly or through the Issuer or any
successor entity, under or by reason of any of the obligations, promises or
agreements entered into in the Bonds or between the Issuer and the Trustee,
whether herein contained or to be implied herefrom. as being supplemental
hereto; and all personal liability of that character against every such
director, member, officer, agent, attorney and employee is, by the execution of
this Indenture and as a condition of, and as part of the consideration for, the
execution of this Indenture, expressly waived and released.
Section 3.8. Credit Facility.
(a) Draws on Credit Facility. Except with respect to Bonds
registered in the name of the Company, or held or required to be held by the
Trustee or any pledge agent under a pledge agreement pursuant to Section 2.8
(which Bonds shall not be entitled to any benefit of any Credit Facility) at any
time a Credit Facility is in effect (i) the Trustee shall draw moneys under such
Credit Facility to the extent necessary to make timely payments of principal,
premium, if any (if such Credit Facility provides for payment of
-47-
<PAGE> 52
such premium), and interest on the Bonds to the extent other Eligible Funds are
not available to effect such payment, in accordance with Section 4.1, (ii) the
Trustee shall draw moneys, in accordance with Section 2.7, under such Credit
Facility to the extent available in accordance with the terms of the Credit
Facility in order to effect the purchase of Bonds (or portions thereof in
Authorized Denominations) on a Mandatory Purchase Date or an Optional Tender
Date, and (iii) upon the occurrence of an Event of Default specified in Section
6.1(a), (b), (c), (f) or (g) or upon declaration of acceleration of the Bonds
pursuant to any other Event of Default, the Trustee shall draw on the Credit
Facility to the extent available in an amount equal to the full unpaid
principal, accrued interest and premium, if applicable (if, and only if, such
Credit Facility provides for payment of such premium), on the Bonds to the
extent other Eligible Funds are not available therefor. The Paying Agent shall
promptly provide notice to the Trustee of any failure to pay principal of,
premium, if any, or interest on the Bonds or the Purchase Price thereof.
(b) Reduction of Credit Facility. Upon any redemption or
defeasance of any Bonds or upon cancellation of any Bonds upon purchase thereof
as contemplated by Section 2.8, the Trustee shall send notice to the Credit
Issuer to reduce the amount available to be drawn on the Credit Facility (with
written notice of the same to the Company) and the Trustee shall, upon request,
confirm to the Credit Issuer and the Company the principal amount of Bonds
redeemed, cancelled or defeased.
(c) Extensions of Credit Facility. In the event that the term of
the Credit Facility is extended, unless it is extended by amendment, the Trustee
shall surrender the instrument evidencing the Credit Facility to the Credit
Issuer in exchange for a new instrument conforming, in the opinion of Counsel,
in all material respects to the instrument evidencing the Credit Facility being
surrendered, except that the term thereof shall reflect the new term of the
Credit Facility. The Trustee shall promptly surrender the instrument evidencing
the Credit Facility to the Credit Issuer for cancellation upon discharge of the
Indenture pursuant to Section 5.1 or following the effective date of an
Alternate Credit Facility (or, if such Alternate Credit Facility results in the
occurrence of a Credit Modification Date, following such Credit Modification
Date). If the Bonds are rated by a Rating Agency, notice of any extension of the
credit Facility shall be furnished to such Rating Agency by the Trustee.
(d) Expiration or Termination of Credit Facility. The Trustee
shall give notice to the Remarketing Agent and the Paying Agent, in the name of
the Credit Issuer, of the expiration or earlier termination of any Credit
Facility then in effect, which notice shall specify the date of such expiration
or earlier termination of the Credit Facility. If the Bonds are rated by a
Rating Agency, notice of any such expiration or termination of the Credit
Facility shall be furnished to such Rating Agency by the Trustee. In the event
that the expiration or termination of a Credit Facility results in the
occurrence of a Credit Modification
-48-
<PAGE> 53
Date, the Trustee shall not surrender any evidence of the Credit Facility to be
terminated until the Trustee shall have made such drawings, if any, and taken
such other actions, if any, thereunder as shall be required under this Indenture
in order to provide sufficient money for payment of the Purchase Price of Bonds
tendered or deemed tendered on such Credit Modification Date to the extent
necessary pursuant to Section 2.6(g), and shall have received the proceeds of
such drawing from the Credit Issuer. Notwithstanding any provision hereof to the
contrary, the Company may not cause any Credit Facility to be terminated prior
to its stated expiration date (whether in connection with the delivery of an
Alternate Credit Facility or otherwise) if such termination would result in the
occurrence of a Credit Modification Date (1) during a Semiannual Rate Period, at
any time other than an Interest Payment Date (or, if such day is not a Business
Day, the next succeeding Business Day) or (2) during a Long-Term Rate Period.
(e) Alternate Credit Facility. At any time, upon at least thirty
(30) days prior written notice to the Trustee, the Paying Agent, the Rating
Agency, if any, rating the Bonds, and the Remarketing Agent, the Company may, at
its option, but subject to the approval of the Remarketing Agent, provide for
delivery to the Trustee of an Alternate Credit Facility that shall be effective
on the date such Alternate Credit Facility is accepted by the Trustee in
accordance herewith. An Alternate Credit Facility shall be issued by a
commercial bank, insurance company or other financial institution organized and
doing business in the United States or a branch or agency of a foreign
commercial bank located in the United States and subject to regulation by state
or federal banking regulatory authorities and shall have an expiration date that
shall be at least one (1) year following the effective date thereof or on the
second Business Day following the final maturity date of the Bonds, if sooner.
On or before the date of the delivery of any Alternate Credit Facility to the
Trustee, as a condition to the acceptance of any Alternate Credit Facility by
the Trustee, the Company shall furnish to the Issuer and the Trustee (i) written
evidence that the issuer of such Alternate Credit Facility is a commercial bank,
insurance company or other financial institution organized and doing business in
the United States or a branch or agency of a foreign commercial bank located and
doing business in the United States and subject to regulation by state or
federal banking regulatory authorities, (ii) an Opinion of Bond Counsel stating
that the delivery of such Alternate Credit Facility is authorized under this
Indenture and the Act and complies with the terms hereof and that the delivery
of such Alternate Credit Facility does not adversely affect the exclusion from
gross income of the interest on the Bonds for federal income tax purposes, (iii)
an opinion of Counsel satisfactory to the Trustee, the Rating Agency, if any,
rating the Bonds, the Issuer, and the Remarketing Agent to the effect that the
Alternate Credit Facility is the legal, valid and binding obligation of the
Credit Issuer (or, in the case of a branch or agency of a foreign commercial
bank, the branch or agency) issuing the same, enforceable in accordance with its
terms, that payments of principal, premium, if any, or Purchase Price of or
interest on the Bonds from the proceeds of a drawing on
-49-
<PAGE> 54
the Alternate Credit Facility will not constitute avoidable preferences under
the United States Bankruptcy Code or other applicable laws and regulations and
that it is not necessary to register the Alternate Credit Facility under the
Securities Act of 1933, as amended, or to qualify an indenture with respect
thereto under the Trust Indenture Act of 1939, as amended, and (iv) evidence of
written approval of the Remarketing Agent. In the case of an Alternate Credit
Facility issued by a branch or agency of a foreign commercial bank there shall
also be delivered an opinion of Counsel licensed to practice law in the
jurisdiction in which the head office of such bank is located, satisfactory to
the Trustee, the Issuer and the Remarketing Agent, to the effect that the
Alternate Credit Facility is the legal, valid and binding obligation of such
bank enforceable in accordance with its terms. The Trustee shall accept any such
Alternate Credit Facility only in accordance with the terms, and upon the
satisfaction of the conditions, contained in this section and any other
provisions applicable to acceptance of an Alternate Credit Facility under this
Indenture. Notwithstanding anything to the contrary herein, any Alternate Credit
Facility shall become effective on a day that is an Optional Tender Date.
Notwithstanding the foregoing, no Alternate Credit Facility may be accepted if
the acceptance thereof in substitution for any then-existing Credit Facility
would result in the occurrence of a Credit Modification Date (1) during a
Semiannual Rate Period, at any time other than on an Interest Payment Date (or
if such day is not a Business Day, on the next succeeding Business Day), or (2)
during any Long-Term Rate Period.
ARTICLE IV
FUNDS
Section 4.1. Establishment and Use of Bond Fund and Current
Account. There is hereby created and established with the Trustee the Bond Fund
and, while a Credit Facility is in effect, within such Fund a special account
designated the "Current Account." The Trustee shall establish with the Paying
Agent a separate subaccount of the Bond Fund that, while a Credit Facility is in
effect, shall be used for depositing moneys drawn by the Trustee under the
Credit Facility for the payment of principal and interest on the Bonds. The
Paying Agent shall not commingle proceeds of a drawing under the Credit Facility
with any other funds. There shall be deposited in the Bond Fund (a) any accrued
interest received on the initial sale of the Bonds, (b) all Repayments specified
in the Agreement to be deposited in the Bond Fund, including all proceeds
resulting from the enforcement of the Security or its realization as collateral,
(c) all other moneys received by the Trustee under the Agreement for deposit by
it in the Bond Fund and (d) all moneys drawn under any Credit Facility to pay
principal, premium, if any, or interest on the Bonds.
While a Credit Facility is in effect, each deposit into the Bond
Fund not constituting Eligible Funds shall be placed in
-50-
<PAGE> 55
the Current Account within the Bond Fund and shall not be commingled with other
moneys in the Bond Fund until such deposit becomes Eligible Funds. The Trustee
shall establish separate subaccounts within the Current Account for each deposit
(including any investment income thereon) made into the Bond Fund so that the
Trustee may at all times ascertain the date of deposit of the moneys in each
subaccount.
Moneys in the Bond Fund shall be held in trust for the Holders
and, except as otherwise expressly provided herein, shall be used solely f or
the payment of the interest on the Bonds and for the payment of principal of and
premium, if any, on the Bonds upon maturity, whether stated or accelerated, or
upon mandatory or optional redemption.
The Issuer hereby authorizes and directs the Trustee, and the
Trustee hereby agrees, to withdraw and make available at the principal office of
the Paying Agent sufficient funds from the Bond Fund to pay the principal of,
premium, if any, and interest on the Bonds as the same become due and payable,
but only in the following order of priority:
FIRST: If a Credit Facility is then in effect, from the sources
provided in clause (i) and (ii) of the definition of Eligible Funds, other than
amounts received by the Trustee in respect of drawings under the Credit
Facility.
SECOND: Amounts drawn by the Trustee under a Credit Facility then
in effect (provided, however, that such amounts shall not be used to pay any
premium on the Bonds unless such Credit Facility provides for the payment of
such premium).
THIRD: Any other amounts (whether or not Eligible Funds) in the
Bond Fund.
If a Credit Facility is not then in effect, or if, while a Credit
Facility is in effect, moneys in the Bond Fund available pursuant to items FIRST
and SECOND above are insufficient to make any payment of principal of, premium,
if any or interest on the Bonds, whether due by maturity, acceleration,
redemption or otherwise, or if the Credit Issuer has dishonored its obligations
under the Credit Facility, the Trustee, on or after the date such payment is to
be made, shall apply any moneys described in item THIRD above.
To the extent that a Credit Facility is drawn on to make a payment
to any Holder, the Trustee shall use any moneys in the Bond Fund not then needed
to make payments to Holders, regardless of whether such moneys constitute
Eligible Funds, to reimburse the Credit Issuer.
After payment in full of the Bonds, or provision for the payment
of the Bonds having been made pursuant to Section 5.2, and the payment of all
other amounts owing hereunder, any amounts remaining in the Bond Fund not
required to provide for payment of
-51-
<PAGE> 56
the Bonds shall be paid first to the Credit Issuer, if any, if there is then any
amount owing by the Company to the Credit Issuer, and, if any amounts still
remain in the Bond Fund, second, to the Company.
Section 4.2. Establishment and Use of Initial Fund. There is
hereby created and established with the Trustee the Initial Fund. A portion of
the proceeds of the Bonds, as described in Section 4.5, shall be delivered to
the Trustee for deposit into the Initial Fund.
Funds in the Initial Fund shall be expended and disbursed in
accordance with the provisions of the Agreement.
Section 4.3. Establishment and Use of Surplus Fund. There is
hereby established and created with the Trustee the Surplus Fund. The Surplus
Fund shall receive all Surplus Bond Proceeds transferred thereto in accordance
with the written directions of the Company. The deposit of Surplus Bond Proceeds
in the Surplus Fund shall be deemed to be a direction by the Company to redeem
the greatest principal amount of the Bonds possible to be redeemed from such
deposit pursuant to Section 2.18(a) on the earliest redemption date on which
such amount constitutes Eligible Funds and Bonds may be redeemed without a
redemption premium, and on such redemption date (or, if such day is not a
Business Day, the immediately preceding Business Day) an amount equal to the
principal amount of Bonds to be redeemed plus interest accrued thereon to the
redemption date shall be transferred from the Surplus Fund to the Bond Fund and
used for such redemption. After such transfer, if and to the extent that there
are moneys in the Surplus Fund constituting Eligible Funds on the date on which
(i) the Bonds are scheduled to mature, or (ii) the Bonds are scheduled to be
redeemed in whole, such moneys in the Surplus Fund shall be transferred to the
Bond Fund and shall be used for such payment or redemption. The foregoing
provisions of this paragraph to the contrary notwithstanding, if while a Credit
Facility is in effect there shall be any moneys on deposit in the Surplus Fund
and there shall occur a drawing on the Credit Facility to pay principal of the
Bonds (but not the Purchase Price of tendered Bonds) the Trustee shall use any
moneys in the Surplus Fund to reimburse the Credit Issuer for such drawing;
provided, further, if any of the events described in clauses (i) and (ii) above
shall occur while a Credit Facility is in effect, the Trustee shall draw on the
Credit Facility to the extent otherwise provided in this Indenture and shall
immediately apply any moneys in the Surplus Fund (whether or not such moneys are
Eligible Funds) to reimburse the Credit Issuer therefor in whole or in part.
Section 4.4. Establishment and Use of Bond Purchase Fund. There is
hereby established and created with the Trustee the Bond Purchase Fund and,
while a Credit Facility is in effect, within such fund a special account
designated the "Current Purchase Account." There shall be deposited in the Bond
Purchase Fund all moneys required to be paid by the Company to provide for the
payment of the Purchase Price of Bonds pursuant to this Indenture,
-52-
<PAGE> 57
together with any other moneys received by the Trustee pursuant to this
Indenture, the Agreement or otherwise (including draws under the Credit Facility
pursuant to Section 3.8(a)(ii)) that are required or directed to be paid into
the Bond Purchase Fund. The Trustee shall establish with the Paying Agent a
separate subaccount, of the Bond Purchase Fund into which the proceeds of the
remarketing of Bonds to purchasers (other than the Issuer or the Company or any
affiliated entity or an "insider" with respect to the Issuer or the Company
within the meaning of Title 11 of the United States Code or to any other Person
obligated (as guarantor or otherwise) to make payments on the Bonds or under the
Agreement or under the Credit Agreement) will be deposited and a separate
subaccount of the Bond Purchase Fund into which all amounts drawn under the
Credit Facility pursuant to Section 3.8(a)(ii) will be deposited. The Paying
Agent shall not commingle amounts in either of such subaccounts with any other
funds.
While a Credit Facility is in effect, each deposit into the Bond
Purchase Fund not constituting Eligible Funds shall be placed in the Current
Purchase Account within the Bond Purchase Fund and shall not be commingled with
other moneys in the Bond Purchase Fund until such deposit becomes Eligible
Funds. The Trustee shall establish separate subaccounts within the Current
Purchase Account for each deposit (including any investment income thereon) made
into the Bond Purchase Fund so' that the Trustee may at all times ascertain the
date of deposit of the moneys in each subaccount.
Moneys in the Bond Purchase Fund shall be held in trust for the
Holders and, except as otherwise expressly provided herein, shall be used solely
for the payment of the Purchase Price of the Bonds required to be purchased as
set forth in Section 2.6(g).
The Trustee is hereby authorized and directed, and the Trustee
hereby agrees, to withdraw and to transfer to the Paying Agent Eligible Funds
from the Bond Purchase Fund as contemplated by Section 2.6(g)(1) by 9:30 a.m.,
Local Time, on each date that Bonds are to be purchased pursuant to Section 2.6
from the Bond Purchase Fund to pay the Purchase Price of Bonds tendered (or
deemed tendered) for purchase pursuant to Section 2.6. The Trustee shall give
the Remarketing Agent prompt telephonic notice of each such transfer.
Any amounts remaining in the Bond Purchase Fund after payment in
full of the Bonds, or provision having been made for payment of the Bonds
pursuant to Section 5.2, and payment of all other amounts required to be paid
under this Indenture, shall be paid first to the Credit Issuer, if any, if there
is any amount then owing by the Company to the Credit Issuer and, if any amounts
still remain in the Bond Purchase Fund, second to the Company.
Section 4.5. Deposit of Bond Proceeds. The proceeds from the
placement of the Bonds shall be deposited as follows:
-53-
<PAGE> 58
(a) In the Bond Fund an amount equal to the interest accrued on
the Bonds, if any, as of the date of delivery thereof; and
(b) In the Initial Fund, the balance of such proceeds.
Section 4.6. Records. The Trustee shall cause to be kept and
maintained records pertaining to the Initial Fund, the Bond Fund, the Bond
Purchase Fund and the Surplus Fund and all disbursements therefrom and shall
periodically deliver to the Company statements of activity and statements
indicating the investments made with moneys in all such funds during the
applicable period. The Trustee shall provide the Company, by July 10 of each
year, with a report stating the principal amount of Bonds outstanding and a list
of the registered owners of the Bonds as of June 30 of each such year.
The Trustee shall provide the Company with a written report, not
later than January 10 of each year, and not later than thirty (30) days
following the retirement of the last obligation of the Bonds, identifying the
Permitted Investments in which the moneys held as part of the Initial Fund, the
Surplus Fund, the Bond Fund and the Bond Purchase Fund were invested during the
preceding period and the dates of such investment.
Section 4.7. Investment of Initial Fund, Surplus Fund, Bond Fund
and Bond Purchase Fund Moneys. Moneys held as part of the Initial Fund, the
Surplus Fund, the Bond Fund and the Bond Purchase Fund shall be invested and
reinvested in Permitted Investments as instructed by an Authorized
Representative; provided, however, that (i) any moneys from a drawing under a
Credit Facility and any moneys held by the Trustee to pay the principal or
Purchase Price of, premium, if any, or interest that has become payable with
respect to the Bonds shall not be invested and (ii) the Paying Agent shall not
invest any moneys it receives under this Indenture. All Permitted Investments
shall be held by or under the control of the Trustee and shall be deemed at all
times to be a part of the fund and account which was used to purchase the same.
All interest accruing thereon and any profit realized from Permitted
Investments shall be credited to the respective fund or account and any loss
resulting from Permitted Investments shall be similarly charged. The Trustee is
authorized to cause to be sold and reduced to cash a sufficient amount of
Permitted Investments whenever the cash balance in any fund or account hereunder
is or will be insufficient to make a requested or required disbursement. The
Trustee shall not be responsible for any depreciation in the value of any
Permitted Investment or for any loss resulting from such sale, so long as the
Trustee performs its obligations hereunder in accordance with the provisions of
Section 7.1(e). Absent specific instructions from the Company to invest cash
balances in Permitted Investments hereunder, the Trustee shall invest in
Permitted Investments constituting obligations of the U.S. Treasury or its
agencies having a term to maturity of not more than 30 days or any money market
fund or similar investment fund that purchases and holds exclusively obligations
of the United
-54-
<PAGE> 59
States of America or its agencies that have a term to maturity of not more than
30 days. Notwithstanding anything to the contrary herein provided, moneys
constituting Eligible Funds shall only be invested in Government obligations
maturing on or before the date such Eligible Funds will be required for
disbursement. Notwithstanding anything to the contrary herein provided, moneys
deposited in the Surplus Fund pursuant to Section 3.4 of the Agreement shall not
be invested at a yield exceeding the yield on the Bonds.
Section 4.8. Arbitrage; Arbitrage Rebate Fund. The Issuer
recognizes that investment of the Bond proceeds will be at the written direction
of the Company but agrees that it will not knowingly commit any act, nor omit to
take any action, that would cause the Bonds to be "arbitrage bonds" within the
meaning of Section 148 of the Code and the applicable regulations thereunder.
There is hereby established with the Trustee a Rebate Fund (the "Rebate Fund").
Any provisions in this Indenture to the contrary notwithstanding, amounts
credited to the Rebate Fund shall be free and clear of any lien hereunder.
The Trustee shall deposit in the Rebate Fund the amount forwarded
to the Trustee by the Company pursuant to Section 8.9(b) of the Agreement.
Within 30 days after the end of each fifth anniversary of the Issue Date,
commencing on the fifth anniversary of the Issue Date, the Trustee, acting on
behalf of the Issuer, shall pay to the United States in accordance with Section
148(f) of the Code from the moneys then on deposit in the Rebate Fund an amount
equal to 90% (or such greater percentage not in excess of 100% as the Company
may direct the Trustee to pay) of the amount certified by the Company to be the
required rebate to the United States as calculated under Section 148(a)(2) of
the Code (hereinafter called the "Rebate Amount") Within 60 days after the
payment in full of all outstanding Bonds, the Trustee shall pay to the United
States in accordance with Section 148(f) of the Code from the moneys then on
deposit in the Rebate Fund an amount equal to 100% of the Rebate Amount and any
moneys remaining in the Rebate Fund following such payment shall be paid to the
Company.
The Trustee shall be entitled to rely on the calculations made
pursuant to this Section and neither the Issuer nor the Trustee shall be
responsible for any loss or damage resulting from any good faith action taken or
omitted to be taken in reliance upon such calculations.
The Trustee shall obtain and keep such records of the computations
made pursuant to this Section as are required under Section 148(f) of the Code.
If all the gross proceeds of the Bonds are expended for the
governmental purpose for which the Bonds were issued within six months of the
date of issuance of the Bonds, within the meaning of section 148(f) of the Code,
and it is not anticipated that any other gross proceeds will arise during the
remainder of the term of the Bonds, and if no Rebate Amount is otherwise payable
with
-55-
<PAGE> 60
respect to the Bonds, the provisions of this Section shall not be applicable to
the Bonds except to the extent of any gross proceeds that actually become
available more than six months after the date of issuance.
Moneys in the Rebate Fund may be invested as provided in Section
4.7 for the investment of the Initial Fund, the Surplus Fund, the Bond Fund and
the Bond Purchase Fund.
Section 4.9. Non-presentment of Bonds. In the event any Bond shall
not be presented for payment when the principal thereof becomes due, either at
maturity or at the date fixed for redemption thereof or otherwise, if funds
sufficient to pay the principal of, premium (if any) and interest on such Bond
shall have been made available to the Trustee for the benefit of the Holder or
Holders thereof, payment of such Bond or portion thereof as the case may be,
shall forthwith cease, terminate and be completely discharged, and thereupon it
shall be the duty of the Trustee, subject to any applicable escheat laws, to
hold such fund or funds uninvested in the Bond Fund, without liability to the
Holder of such Bond for interest thereon, for the benefit of the Holder of such
Bond, who shall thereafter be restricted exclusively to such fund or funds, for
any claim of whatever nature on his/her part on, or with respect to, said Bond,
or portion thereof, or premium, if any.
ARTICLE V
DISCHARGE OF LIEN
Section 5.1. Discharge of Lien and Security Interest. Upon payment
in full of all of the Bonds, these presents and the Security Interests shall
cease, determine and be discharged, and thereupon the Trustee, upon receipt by
the Trustee of an opinion of Counsel stating that all conditions precedent to
the satisfaction and discharge of this Indenture have been complied with shall
(i) cancel and discharge this Indenture and the Security Interests, and (ii)
execute and deliver to the Issuer and the Company, at the Company's expense,
such instruments in writing as shall be required to cancel and discharge this
Indenture and the Security Interests and reconvey to the Issuer and the Company
the Security, and assign and deliver to the Issuer and the Company so much of
the Security as may be in its possession or subject to its control, except for
moneys and Government Obligations held in the Bond Fund for the purpose of
paying Bonds and except for moneys held in the Bond Purchase Fund for the
purpose of paying the Purchase Price of the Bonds which have been purchased
pursuant to Section 2.6(g); and (iii) return any Credit Facility to the Credit
Issuer; provided, however, that the cancellation and discharge of this Indenture
pursuant to Section 5.2 shall not terminate the powers and rights granted to the
Trustee, the Registrar, the Tender Agent and the Paying Agent with respect to
the payment, registration of transfer and exchange of the Bonds; and provided,
further, that the rights of the Issuer, the Trustee, the Registrar, the Tender
Agent and the Paying Agent to indemnity, non-liability and payment of all
-56-
<PAGE> 61
reasonable fees and expenses shall survive the cancellation and discharge of
this Indenture pursuant to Section 5.1 or 5.2. If the Bonds are rated by a
Rating Agency, notice of payment in full of the Bonds shall be furnished to such
Rating Agency.
Section 5.2. Provision for Payment of Bonds. During the Fixed Rate
Period, Bonds shall be deemed to have been paid within the meaning of Section
5.1 if:
(a) there shall have been irrevocably deposited in the Bond Fund
either:
(i) sufficient Eligible Funds, or
(ii) Government obligations purchased with Eligible Funds of such
maturities and interest payment dates and bearing such interest as
will, in the opinion of a nationally recognized firm of certified
public accountants, without further investment or reinvestment of
either the principal amount thereof or the interest earnings
thereon (said earnings also to be held in trust), be sufficient
together with any moneys referred to in subsection (i) above,
for the payment at their respective maturities or redemption dates prior to
maturity of the principal thereof and the redemption premium, if any, and
interest to accrue thereon at such maturity or redemption dates, as the case may
be;
(b) there shall have been paid or provision duly made for the
payment of all fees and expenses of the Issuer, the Trustee, the Registrar, the
Paying Agent, the Remarketing Agent and the Tender Agent due or to become due;
and
(c) if any Bonds are to be redeemed on any date prior to their
maturity, the Trustee shall have received in form satisfactory to it irrevocable
instructions from an Authorized Representative to redeem such Bonds on such date
and either evidence satisfactory to the Trustee that all redemption notices
required by this Indenture have been given or irrevocable power authorizing the
Trustee to give such redemption notices has been granted to the Trustee.
Limitations set forth elsewhere herein regarding the investment of
moneys held by the Trustee in the Bond Fund shall not be construed to prevent
the depositing and holding in the Bond Fund of the obligations described in
paragraph (a) (ii) of this section for the purpose of defeasing the lien of this
Indenture as to Bonds which have not yet become due and payable. In addition,
all moneys so deposited with the Trustee as provided in this Section 5.2 may
also be invested and reinvested, at the direction of the Company, in Government
obligations, maturing in the amounts and times as hereinbefore set forth, and
all income from all Government Obligations in the hands of the Trustee pursuant
to this Section 5.2 which is not required for the payment of the Bonds and
interest
-57-
<PAGE> 62
and redemption premium, if any, thereon with respect to which such moneys shall
have been so deposited shall be deposited in the Bond Fund as and when realized
and collected for use and application as are other moneys deposited in the Bond
Fund.
If the Bonds are to be rated by a Rating Agency at or prior to the
time provision for payment shall be made there shall be delivered to the Rating
Agency the opinion of nationally recognized certified public accountants
referred to in Section 5.2 (a) (ii) above and a written opinion of counsel
experienced in bankruptcy law matters and in form satisfactory to the Rating
Agency that the deposit and use of such monies will not constitute an avoidable
preferential payment pursuant to Section 547 of the United States Bankruptcy
Code, 11 U.S.C. Section 101 et seq., or a post-petition transfer in the event of
an Act of Bankruptcy.
Section 5.3. Discharge of this Indenture. Notwithstanding the fact
that the lien of this Indenture upon the Security may have been discharged and
cancelled in accordance with Section 5.1, this Indenture and the rights granted
and duties imposed hereby, to the extent not inconsistent with the fact that the
lien upon the Security may have been discharged and cancelled, shall
nevertheless continue and subsist after payment in full of the Bonds until the
Trustee shall have returned to the Company or the Credit Issuer, as the case may
be, all funds held by the Trustee which the Company is entitled to receive
pursuant to this Indenture.
ARTICLE VI
DEFAULT PROVISIONS AND REMEDIES
Section 6.1. Events of Default. Any one of the following shall
constitute an Event of Default hereunder:
(a) Default in the payment of any interest on any Bond when and as
the same shall have become due;
(b) Default in the payment of the principal of or any premium on
any Bond when and as the same shall become due, whether at the stated maturity
or redemption date thereof or by acceleration;
(c) Default in the payment of the Purchase Price of any Bond
required to be purchased hereunder when and as the same shall become due;
(d) Default in the observance or performance of any other of the
covenants, agreements or conditions on the part of the Issuer included in this
Indenture or in the Bonds and the continuance thereof for a period of thirty
(30) days after written notice to the Issuer, the Credit Issuer, if a Credit
Facility is then in effect, and the Company has been given by the Trustee,
-58-
<PAGE> 63
provided that the Credit Issuer shall have consented to the same constituting an
Event of Default;
(e) The occurrence of an Event of Default under the Agreement;
(f) If a Credit Facility is in effect, the Trustee and the Tender
Agent shall have received a written notice from the Credit Issuer of the
occurrence and continuance of an Event of Default as defined in the Credit
Agreement; or
(g) If a Credit Facility is in effect, the Trustee and the Tender
Agent shall have received, within 10 calendar days following a drawing under the
Credit Facility to pay interest on the Bonds, written notice from the Credit
Issuer that it has not been reimbursed for the amount of such drawing together
with interest, if any, due pursuant to the Credit Agreement and that the amount
of such drawing will not be reinstated as provided in the Credit Facility.
Section 6.2. Acceleration. Subject to the requirement that the
consent of the Credit Issuer, if any, to any acceleration must be obtained in
the case of an Event of Default described in Section 6.1(d) or (e), upon the
occurrence of any Event of Default hereunder the Trustee may and upon (i) the
written request of the Holders of not less than twenty-five percent (25%) in
aggregate principal amount of Bonds then Outstanding or (ii) the occurrence of
an Event of Default under Section 6.1(a), (b), (c), (f) or (g), the Trustee
immediately shall, by notice in writing sent to the Issuer, the Company, the
Paying Agent and the Tender Agent, and, if a Credit Facility is then in effect,
the Credit Issuer, declare the principal of and any premium on all Bonds then
Outstanding (if not then due and payable) and the interest accrued thereon to be
due and payable immediately, and, upon said declaration, such principal and
premium, if any, and interest shall become and be immediately due and payable.
Upon any declaration of acceleration hereunder, the Trustee shall immediately
exercise such rights as it may have under the Agreement to declare all payments
thereunder to be immediately due and payable, interest on the Bonds shall cease
to accrue as provided in Section 6.7 and, if a Credit Facility is in effect, to
the extent it has not already done so and to the extent necessary, the Trustee
shall immediately draw upon the Credit Facility as provided in Section 3.8 (a)
(iii) The Trustee shall pay the principal of, premium, if any, and interest on
the Bonds to the Holders as soon as is practicable following the receipt of
funds from such drawing.
Immediately following any such declaration of acceleration, the
Trustee shall cause to be mailed notice of such declaration by first class mail,
postage prepaid, to each Holder of a Bond at his/her last address appearing on
the Register. Any defect in or failure to give such notice of such declaration
shall not affect the validity of such declaration.
-59-
<PAGE> 64
Section 6.3. Other Remedies; Rights of Holders. Upon the happening
and continuance of an Event of Default hereunder the Trustee may, only with the
prior written consent of the Credit Issuer, if any, in the case of an Event of
Default described in Section 6.1(d) or (e), with or without taking action under
Section 6.2, pursue any available remedy to enforce the performance of or
compliance with any other obligation or requirement of this Indenture or the
Agreement.
Subject to the requirement that the consent of the Credit Issuer,
if any, to the exercise by the Trustee of any such available remedy must be
obtained in the case of an Event of Default described in Section 6.1(d) or (e),
upon the happening and continuance of an Event of Default, and if requested to
do so by the Holders of at least twenty-five percent (25%) in aggregate
principal amount of Bonds then outstanding and if the Trustee is indemnified as
provided in Section 7.1, the Trustee shall exercise such of the rights and
powers conferred by this section and by Section 6.2 as the Trustee, being
advised by Counsel, shall deem most effective to enforce and protect the
interests of the Holders and, except to the extent inconsistent with the
interests of the Holders, the Credit Issuer, if any.
No remedy by the terms of this Indenture conferred upon or
reserved to the Trustee (or to the Holders) is intended to be exclusive of any
other remedy, but each and every such remedy shall be cumulative and shall be in
addition to any other remedy given to the Trustee or to the Holders hereunder or
now or hereafter existing.
No delay or omission to exercise any right or power accruing upon
any default or Event of Default shall impair any such right or power or shall be
construed to be a waiver of any such default or Event of Default or acquiescence
therein and every such right and power may be exercised from time to time and as
often as may be deemed expedient.
No waiver of any default or Event of Default hereunder, whether by
the Trustee or by the Holders, shall extend to or shall affect any subsequent
default or Event of Default or shall impair any rights or remedies consequent
thereon.
The Trustee, as the assignee of substantially all right, title and
interest of the Issuer in and to the Agreement, shall be empowered to enforce
each and every right granted to the Issuer under the Agreement other than
Reserved Rights.
Section 6.4. Right of Holders and Credit Issuer to Direct
Proceedings. Anything in this Indenture to the contrary notwithstanding, and
subject, if a Credit Facility is then in effect, to the rights of the Credit
Issuer as provided in Sections 6.2 and 6.3, the Holders of a majority in
aggregate principal amount of Bonds then Outstanding shall have the right at any
time, by an instrument or instruments in writing executed and delivered to the
Trustee, to direct the method and place of conducting all
-60-
<PAGE> 65
proceedings to be taken in connection with the enforcement of the terms and
conditions of this Indenture, or any other proceedings hereunder; provided that
such direction shall not be otherwise than in accordance with the provisions of
law and of this Indenture, and provided that the Trustee shall be indemnified to
its satisfaction and the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction. No Holder shall
individually have the right to present a draft to, or otherwise make a demand
on, the Credit Issuer to collect amounts available under the Credit Facility.
No Holder shall have the right to institute any proceeding for the
enforcement of this Indenture unless such Holder has given the Trustee and the
Company written notice of an Event of Default, the Holders of a majority in
aggregate principal amount of the Bonds then outstanding shall have requested
the Trustee in writing to institute such proceeding, the Trustee shall have been
afforded a reasonable opportunity to exercise its powers or to institute such
proceeding, there shall have been offered to the Trustee indemnity satisfactory
to it against the cost, expense and liability to be incurred in connection with
such request and the Trustee shall have thereafter failed or refused to exercise
such powers or to institute such proceeding within sixty days (60) after receipt
of notice with no inconsistent direction given during such sixty days (60) by
the Holders of a majority in aggregate principal amount of the Bonds then
Outstanding. Nothing in this Indenture shall affect or impair any right of
enforcement conferred on any Holder by the Act to enforce (i) the payment of the
principal of and premium, if any, and interest on Bonds at and after the
maturity thereof, or (ii) the obligation of the Issuer to pay the principal of,
premium, if any, and interest on Bonds to such Holder at the time, place, from
the sources and in the manner as provided in this Indenture.
Section 6.5. Discontinuance of Default Proceedings. Prior to the
drawing on a Credit Facility, if any, pursuant to Section 3.8(a)(iii), in case
the Trustee shall have proceeded to enforce any right under this Indenture by
the appointment of a receiver or otherwise, and such proceedings shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely, then and in every such case the Issuer, the Credit Issuer, if any,
and the Trustee shall be restored to their former positions and rights hereunder
and all rights, remedies and powers of the Trustee and Credit Issuer shall
continue as if no such proceedings had been taken subject to the limits of any
adverse determination.
Section 6.6. Waiver. The Trustee, with the consent of the Credit
Issuer, if any, may waive any default or Event of Default hereunder and its
consequences and rescind any declaration of acceleration of maturity of
principal, and shall do so upon the written request of the Credit Issuer, if
any; provided, however, that there shall be no such waiver or rescission unless
the Purchase Price and all principal, premium, if any, and interest on the Bonds
in arrears, together with interest thereon (to the extent
-61-
<PAGE> 66
permitted by law) at the applicable rate of interest borne by the Bonds and all
fees and expenses of the Trustee and the Issuer shall have been paid or provided
for. The Trustee may not waive any default or Event of Default until the amount
available to be drawn under any Credit Facility then in effect in respect of the
principal and Purchase Price of and interest on the Bonds has been reinstated in
full.
Section 6.7. Application of Moneys. All moneys received by the
Trustee pursuant to any right given or action taken under the provisions of this
Article VI shall be deposited in the Bond Fund and, after payment (out of moneys
derived from a source other than the Credit Facility, Eligible Funds, moneys
held for the purchase of Untendered Bonds, moneys held for the redemption of
Bonds and proceeds from the remarketing of Bonds) of (i) the cost and expenses
of the proceedings resulting in the collection of such moneys and of the
expenses, liabilities and advances incurred or made by the Trustee, including
reasonable attorneys' fees, and all other outstanding fees and expenses of the
Trustee, and thereafter any fees, expenses, liabilities and advances due to, or
incurred or made by, the Paying Agent, the Tender Agent and the Registrar and
(ii) any sums due to the Issuer under the Agreement (other than Repayments),
such moneys shall be applied in the order set forth below:
(a) Unless the principal of all Bonds shall have become or been
declared due and payable, all such moneys shall be applied:
First: To the payment of all installments of interest then
due on the Bonds in order of priority first to installments past
due for the greatest period and, if the amount available shall not
be sufficient to pay in full any particular installment, then to
the ratable payment of the amounts due on such installment; and
Second: To the payment of the unpaid principal of and
premium, if any, of the Bonds which shall have become due (other
than Bonds called for redemption for the payment of which moneys
are held pursuant to the provisions of this Indenture), with
interest on such Bonds from the respective dates upon which they
became due (at the rate borne by the Bonds, to the extent
permitted by law) and, if the amount available shall not be
sufficient to pay in full Bonds due on any particular date,
together with such premium, then to the ratable payment of the
amounts due on such date.
(b) If the principal of all the Bonds shall have become or been
declared due and payable, all such moneys shall be applied to the payment of the
principal, premium, if any, and interest then due and unpaid upon the Bonds,
without preference or priority as between principal, premium, interest,
installments of interest or Bonds, ratably according to the amounts due
respectively for principal, premium and interest to the persons entitled
thereto.
-62-
<PAGE> 67
(c) If the principal on all Bonds shall have been declared due and
payable, and if such declaration shall thereafter have been rescinded under this
Article then, subject to subsection (b) of this Section in the event that the
principal of all the Bonds shall again become or be declared due and payable,
the moneys shall be applied in accordance with subsection (a) of this Section.
Notwithstanding the foregoing, unless the Credit Facility permits
drawings to pay premium with respect to Bonds, the Trustee shall be obligated to
apply moneys received under a Credit Facility then in effect and Eligible Funds
taken into account in calculating the required draw under such Credit Facility,
only to principal and Purchase Price of, and interest on the Bonds (except Bonds
that are not entitled to any benefit of the Credit Facility as provided in
Section 3.8). Whenever moneys are to be applied pursuant to this Section, the
Trustee shall fix the date which shall be not more than seven calendar days
after such acceleration upon which such application is to be made and upon such
date interest on the principal amount of Bonds to be paid on such dates shall
cease to accrue. The Trustee shall give such notice as it may deem appropriate
of the deposit with it of any such moneys and of the fixing of any such date.
Section 6.8 Rights of a Credit Issuer. All rights of any Credit
Issuer under this Indenture to consent to certain extensions, remedies, waivers,
actions and amendments hereunder shall cease, determine and become null and void
(i) for so long as the Credit Issuer wrongfully dishonors any draft (or other
appropriate form of demand) presented in strict conformity with the requirements
of the Credit Facility and has not honored a subsequent draft (or other
appropriate form of demand), if any, thereunder or (ii) if no Credit Facility is
in effect or any Credit Facility terminates in accordance with its terms.
ARTICLE VII
THE TRUSTEE; THE PAYING AGENT; THE TENDER AGENT;
THE REGISTRAR; THE REMARKETING AGENT
Section 7.1. The Trustee is hereby appointed and does hereby agree
to act in such capacity, and to perform the duties of the Trustee under this
Indenture, but only upon and subject to the following express terms and
conditions (and no implied covenants or other obligations shall be read into
this Indenture against the Trustee):
(a) The Trustee may execute any of its trusts or powers hereunder
and perform any of its duties by or through attorneys, agents, receivers or
employees and shall not be held liable for their actions if such agents are
selected with reasonable care. The Trustee shall be entitled to advice of
Counsel concerning all matters hereunder, and may in all cases pay such
reasonable compensation to all such attorneys, agents, receivers and employees.
The Trustee may act upon the opinion or advice of Counsel, accountants,
engineers or surveyors selected by it in the
-63-
<PAGE> 68
exercise of reasonable care or, if the same are selected by the Issuer, approved
by the Trustee in the exercise of reasonable care. The Trustee shall not be
responsible for any loss or damage resulting from any action or non-action in
good faith in reliance upon such opinion or advice.
(b) The Trustee shall not be responsible for any recital herein or
in the Bonds, or for the recording, rerecording, filing or re-filing of this
Indenture, of any financing statements or continuation statements, or for
insuring the Security or the Project or collecting any insurance moneys, or for
the validity of this Indenture or of any supplements hereto or instruments of
further assurance, or for the sufficiency of the security for the Bonds issued
hereunder or intended to be secured hereby, or for the value of or title to the
Project or otherwise as to the maintenance of the Security. The Trustee shall
have no obligation to perform any of the duties of the Issuer under the
Agreement. The Trustee shall not be liable to the Company, any Holder, any
Beneficial owner or any other Person for any loss suffered in connection with
any investment of funds made by it in accordance with Section 4.7. The Trustee
shall not be liable to the Company for any loss suffered as a result of or in
connection with any investment of funds made by the Trustee in good faith as
instructed by or approved by an Authorized Representative.
(c) The Trustee shall not be accountable for the Use of any Bonds
authenticated or delivered hereunder after such Bonds shall have been delivered
in accordance with instructions of the Issuer or for the use by the Company of
the proceeds of the Bonds advanced to the Company as provided in the Agreement
or for the use or application of any moneys received by the Paying Agent. The
Trustee may become the owner of Bonds secured hereby with the same rights as any
other Holder.
(d) The Trustee shall be protected in acting upon opinions of
Counsel and upon any notice, request, consent, certificate, order, affidavit,
letter, telegram or other paper or document believed to be genuine and correct
and to have been signed or sent by the proper person or persons. Any action
taken by the Trustee pursuant to this Indenture upon the request or authority or
consent of any person who at the time of making such request or giving such
authority or consent is the Holder of any Bond shall be conclusive and binding
upon all future Holders of the same Bond and upon Bonds issued in exchange
therefor or in place thereof. The Trustee may conclusively rely upon a
certificate furnished by a Credit Issuer as to amounts owing under the Credit
Agreement.
(e) The permissive right of the Trustee to do things enumerated in
this Indenture or the Agreement shall not be construed as duties. The Trustee
shall only be responsible for the performance of the duties expressly set forth
herein and shall not be answerable for other than its gross negligence or bad
faith in the performance of those express duties.
-64-
<PAGE> 69
(f) The Trustee shall not be personally liable for any debts
contracted or for damages to persons or to personal property injured or damaged,
or for salaries or non-fulfillment of contracts, relating to the Project.
(g) The Trustee shall not be required to give any bond or surety
in respect of the execution of the said trust and powers or otherwise in respect
of the premises.
(h) Before taking any action requested hereunder by the Holders
(except for acceleration of the Bonds as required by Section 6.2, for drawing on
the Credit Facility as required by Section 3.8(a) and with respect to the
payment of principal, interest and Purchase Price to Holders), the Trustee may
require satisfactory security or indemnity bond for the reimbursement of all
expenses to which it may be put and to protect it against all liability, except
liability which is adjudicated to have resulted from its own gross negligence or
bad faith by reason of any action so taken.
(i) All moneys received by the Trustee or the Paying Agent, until
used or applied or invested as herein provided, shall be held as special trust
funds for the purposes specified in this Indenture and for the benefit and
security of the Holders of the Bonds and the Credit Issuer as herein provided.
Such moneys need not be segregated from other funds except to the extent
required by law or herein provided, and neither the Trustee nor the Paying Agent
shall otherwise be under any liability for interest on any moneys received
hereunder except such as may be agreed upon.
(j) The Trustee shall not be bound to ascertain or inquire as to
the performance of the obligations of the Company or the Issuer under the
Agreement or this Indenture, and shall not be deemed to have, or be required to
take, notice of default under this Indenture (other than under Section 6.1(a),
(b) or (c) if notice thereof has been received from the Paying Agent or under
Section 6.1(f) or (g)) or the occurrence of a Determination of Taxability by
reason of either the enactment of legislation or the adoption of final
regulations, except (i) if no Credit Facility is in effect, in the event the
Company fails to pay any Repayment when due, (ii) in the event of an
insufficient amount in the Bond Fund (or any account therein) to make a
principal or interest payment on the Bonds, (iii) written notification of a
Determination of Taxability by the Holder of any Bonds, (iv) written
notification of such default by two or more Holders with combined holdings of
not less than twenty-five percent (25%) of the principal amount of Outstanding
Bonds or (v) written notification from the Credit Issuer pursuant to Section 6.1
hereof, and in the absence of such notice the Trustee may conclusively presume
there is no Determination of Taxability and no default except as aforesaid. The
Trustee may nevertheless require the Issuer and the Company to furnish
information regarding performance of their obligations under the Agreement and
this Indenture, but is not obligated to do so.
-65-
<PAGE> 70
(k) The Trustee shall, prior to any Event of Default and after the
curing of all Events of Default which may have occurred, perform such duties and
only such duties of the Trustee as are specifically set forth in this Indenture.
The Trustee shall, during the existence of any Event of Default which has not
been cured, exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his/her own affairs. The foregoing shall not limit the Trustee's obligations
under Section 3.8(a) or Section 6.2.
(l) The Paying Agent, the Tender Agent and the Registrar shall
each be entitled to the same rights and immunities with respect to their
respective duties under this Indenture as the Trustee is under this Section 7.1
with respect to its duties hereunder.
(m) In addition to the Trustee's other duties hereunder, the
Trustee shall authenticate and cancel Bonds as provided herein, keep such books
and records relating to such duties as shall be consistent with prudent industry
practice and make such books and records available for inspection by the Issuer
and the Company at all reasonable times. All Bonds shall be made available for
authentication, exchange and registration of transfer at the principal office of
the Trustee.
(n) The Trustee shall have no duty to inspect or oversee the
construction or completion of the Project or to verify the truthfulness or
accuracy of the certifications made by the Company with respect to the Trustee's
disbursements for Costs of the Project in accordance with the Agreement and this
Indenture.
Section 7.2. Compensation and Indemnification of Trustee, Paying
Agent, Tender Agent and Registrar; Trustee's Prior Claim. The Agreement provides
that the Company will pay the reasonable fees and expenses of the Issuer, the
Trustee, the Tender Agent, the Paying Agent, the Placement Agent, the
Remarketing Agent and the Registrar under this Indenture and all other amounts
which may be payable to the Trustee, Paying Agent, Registrar or Tender Agent
under this Section 7.2, and the reasonable fees and expenses of the Remarketing
Agent, such fees and expenses to be paid when due and payable by the Company
directly to the Trustee, Tender Agent, Paying Agent, Registrar and Remarketing
Agent, respectively, for their own account.
The Company shall (a) pay the Trustee from time to time, and the
Trustee shall be entitled to, reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust), (b) pay the Paying Agent, the Tender Agent and the Registrar and
any other agent of the Issuer or the Company acting hereunder or under the
Agreement (the Paying Agent, the Tender Agent and the Registrar and any other
agent of the Issuer being herein referred to as a "Company Agent") reasonable
compensation, (c) pay or reimburse each
-66-
<PAGE> 71
of the Trustee and any Company Agent upon request for all reasonable expenses,
disbursements and advances incurred or made, in accordance with any of the
provisions of this Indenture and the Agreement (including the reasonable
compensation and the reasonable expenses and disbursements of its Counsel and of
all agents and other persons not regularly in its employ), except to the extent
that any such expense, disbursement or advance is due to its own gross
negligence or bad faith, and (d) indemnify each of the Trustee and any Company
Agent for, and to hold it harmless against, any loss, liability or expense
incurred by it, arising out of or in connection with the acceptance or
administration of this Indenture or the trusts hereunder or the performance of
its duties hereunder or under the Agreement, including the reasonable costs and
expenses of defending itself against or investigating any claim of liability in
the premises, except to the extent that any such loss, liability or expense was
due to its own gross negligence or bad faith. The obligations of the Company
under the Agreement referred to in this Section 7.2 shall constitute additional
indebtedness hereunder and shall survive the satisfaction and discharge of this
Indenture. Such additional indebtedness shall be a senior claim to that of the
Bonds upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the Holders of the Bonds, funds
held with respect to Untendered Bonds and unredeemed Bonds for which notice of
redemption has been given, and except for any arbitrage rebate fund or account
established pursuant hereto or pursuant to any arbitrage regulatory agreement.
Notwithstanding the foregoing, neither the Trustee nor any Company
Agent shall have any claim upon or shall be paid, prior to any Holder, from any
Credit Facility, Eligible Funds or proceeds from the remarketing of Bonds, or
the proceeds thereof, with respect to any such compensation, payment,
reimbursement or indemnity. "Trustee", "Company Agent", "Paying Agent", "Tender
Agent" and "Registrar" for purposes of this Section 7.2 shall include any
predecessor Trustee, Company Agent, Paying Agent, Tender Agent and Registrar but
the gross negligence or bad faith of any Trustee, Company Agent, Paying Agent,
Tender Agent or Registrar shall not affect the indemnification of any other
Person.
Section 7.3. Intervention in Litigation. In any judicial
proceedings to which the Issuer is a party, the Trustee may intervene on behalf
of Holders, and shall intervene if requested in writing by the Holders of at
least twenty-five percent (25%) in aggregate principal amount of Bonds then
Outstanding.
Section 7.4. Resignation. The Trustee and any successor Trustee
may resign only upon giving sixty (60) days prior written notice to the Issuer,
the Credit Issuer, if any, the Company and each Holder of Bonds then Outstanding
as shown on the Register. Such resignation shall take effect only upon the
appointment of a successor Trustee by the Issuer with the written consent of the
Company and the Credit Issuer, if any. If no successor is appointed within sixty
(60) days after the notice of resignation, the resigning party may appoint a
successor or petition any court of competent jurisdiction to appoint a
successor. Upon appointment of
-67-
<PAGE> 72
a successor Trustee, the resigning Trustee shall assign all of its right, title
and interest in the Security, including its right, title and interest in any
Credit Facility then in effect and the Indenture, to the successor Trustee. The
successor Trustee shall be a national banking association or a bank or trust
company organized under the laws of the United States of America or any state of
the United States, or the District of Columbia, having a combined capital stock,
surplus and undivided profits aggregating at least $50,000,000, and, if the
Bonds are rated by a Rating Agency, the successor Trustee must be a bank or
trust company whose outstanding bank deposit obligations are rated at least
Baa3/P-3 or otherwise be acceptable to such Rating Agency. Any successor Trustee
shall accept in writing its duties and responsibilities hereunder and such
writing shall be filed with the Issuer, the Credit Issuer, if any, and the
Company.
Section 7.5. Removal of Trustee. The Trustee may be removed at any
time, by an instrument or concurrent instruments in writing delivered to the
Trustee, the Credit Issuer, if any, the Issuer and the Company and signed by the
Holders of a majority in aggregate principal amount of Bonds then Outstanding.
Upon such removal, the Trustee shall assign to the successor Trustee all of its
right, title and interest in the Security in the same manner as provided in
Section 7.4. If the Bonds are rated by a Rating Agency, notice concerning any
change in the Trustee shall be furnished to such Rating Agency.
Section 7.6. Paying Agent. Wachovia Bank of North Carolina,
National Association, is hereby appointed by the Issuer as the initial Paying
Agent. The Issuer, at the direction of the Company and with the approval of the
Remarketing Agent and the Credit Issuer, if any, shall appoint any successor
Paying Agent for the Bonds, subject to the conditions set forth in Section 7.8.
The Paying Agent shall designate to the Issuer and the Trustee its principal
office for all purposes hereof and signify its acceptance of the duties imposed
upon it hereunder by a written instrument of acceptance delivered to the Issuer
and the Trustee under which the Paying Agent shall agree, particularly:
(i) to hold all sums held by it for the payment of the
principal of, premium, if any, or interest on the Bonds in
trust for the benefit of the Holders of the Bonds until
such sums shall be paid to such Holders of the Bonds or
otherwise disposed of as herein provided;
(ii) to perform its obligations under Article II of this
Indenture; and
(iii) to keep such books and records relating to its duties
as Paying Agent as shall be consistent with prudent
industry practice and to make such books and records
available for inspection by the Issuer, the Trustee and the
Company at all reasonable times.
-68-
<PAGE> 73
The Issuer shall cooperate with the Trustee, the Paying Agent and the Company to
cause the necessary arrangements to be made and to be thereafter continued
whereby:
(a) funds derived from the sources specified in this Indenture
will be made available at the principal office of the Paying Agent for the
timely payment of principal, premium, if any, and interest on the Bonds; and
(b) the Paying Agent shall be furnished such records and other
information, at such times, as shall be required to enable the Paying Agent to
perform the duties and obligations imposed upon it hereunder.
In carrying out its responsibilities hereunder the Paying Agent
will act for the benefit of the Holders. Notwithstanding anything to the
contrary in this Indenture, the Paying Agent shall not invest any moneys it
receives from a draw on the Credit Facility if any.
No purchase of Bonds by the Paying Agent shall constitute a
redemption of Bonds or any extinguishment of the debt represented thereby or
constitute the Paying Agent the owner of such Bonds for any purpose whatsoever.
Section 7.7. Tender Agent. Wachovia Bank of North Carolina,
National Association, is hereby appointed by the Issuer as the initial Tender
Agent. The Issuer, at the direction of the Company and with the approval of the
Remarketing Agent and the Credit Issuer, shall appoint any succeeding Tender
Agent for the Bonds, subject to the conditions set forth in Section 7.8. The
Tender Agent shall designate to the Issuer and the Trustee its principal office
for all purposes hereof and signify its acceptance of the duties imposed upon it
hereunder by a written instrument of acceptance delivered to the Issuer and the
Trustee under which the Tender Agent shall agree, particularly:
(i) to hold all sums held by it for the payment of the
principal of, premium, if any, or interest on the Bonds in
trust for the benefit of the Holders of the Bonds until
such sums shall be paid to such Holders of the Bonds or
otherwise disposed of as herein provided;
(ii) to perform its obligations under this Indenture; and
(iii) to keep such books and records relating to its duties
as Tender Agent as shall be consistent with prudent
industry practice and to make such books and records
available for inspection by the Issuer, the Trustee and the
Company at all reasonable times.
-69-
<PAGE> 74
The Issuer shall cooperate with the Trustee and the Company to
cause the necessary arrangements to be made and to be thereafter continued
whereby the Tender Agent shall be furnished such records and other information,
at such times, as shall be required to enable the Tender Agent to perform the
duties and obligations imposed upon it hereunder.
No delivery of Bonds to the Tender Agent shall constitute a
redemption of Bonds or any extinguishment of the debt represented thereby or
constitute the Tender Agent the owner of such Bonds for any purpose whatsoever.
Section 7.8. Qualifications of Paying Agent and Tender Agent;
Resignation; Removal.
(a) The Paying Agent and the Tender Agent shall each be a bank or
trust company duly organized under the laws of the United States of America or
any state or territory thereof, having a combined capital stock, surplus and
undivided profits of at least $15,000,000 and authorized by law to perform all
the duties imposed upon it by this Indenture. The principal office of each of
the Paying Agent and the Tender Agent for all purposes hereof shall be the off
ice of the Paying Agent or the Tender Agent, as the case may be, at which all
deliveries to it hereunder shall be made and any and all notices and other
communications in connection herewith shall be delivered. The Paying Agent or
the Tender Agent may at any time resign and be discharged of its duties and
obligations created by this Indenture by giving at least sixty (60) days' notice
to the Issuer, the Company and the Trustee. The Paying Agent or the Tender Agent
may be removed at any time, at the direction of the Company, by an instrument,
signed by the Issuer, filed with such Paying Agent or Tender Agent, as the case
may be, and with the Trustee.
(b) In the event of the resignation or removal of the Paying Agent
or the Tender Agent, the Paying Agent or the Tender Agent, as the case may be,
shall deliver any moneys and any Bonds and any related books and records held by
it in such capacity to its successor or, if there be no successor, to the
Trustee.
(c) In the event that the Paying Agent or the Tender Agent shall
resign or be removed, or be dissolved, or if the property or affairs of the
Paying Agent or the Tender Agent shall be taken under the control of any state
or federal court or administrative body because of bankruptcy or insolvency, or
for any other reason, and the Issuer shall not have appointed a successor Paying
Agent or Tender Agent (any appointment by the Issuer shall be with the prior
written consent of the Company), as the case may be, the Trustee shall, upon
receiving written notice from the Issuer that the Issuer has not appointed a
successor Paying Agent or Tender Agent, as the case may be, ipso facto be deemed
to be the Paying Agent or Tender Agent, as the case may be, for all purposes of
this Indenture until the appointment by the Issuer of a successor Paying Agent
or Tender Agent, as the case may be. If the Bonds are rated by a Rating Agency,
any successor Paying Agent or Tender Agent shall be a bank or trust company
whose outstanding
-70-
<PAGE> 75
bank deposit obligations are rated at least Baa3/P-3 or otherwise be acceptable
to such Rating Agency.
Section 7.9. Instruments of Holders. Any instrument required by
this Indenture to be executed by Holders may be in any number of writings of
similar tenor and may be executed by Holders in person or by agent appointed in
writing. Proof of the execution of any such instrument or of the writing
appointing any such agent and of the ownership of Bonds given in any of the
following forms shall be sufficient for any of the purposes of this Indenture:
(i) A certificate of any officer in any jurisdiction who by
law has power to take acknowledgements within such
jurisdiction that the person signing such writing
acknowledged before him/her the execution thereof.
(ii) A certificate executed by any trust company or bank
stating that at the date thereof the party named therein
did exhibit to an officer of such trust company or bank, as
the property of such party, the Bonds therein mentioned.
The Trustee may rely on such an instrument of Holders unless and
until the Trustee receives notice in the form specified in (i) or (ii) above
that the original such instrument is no longer reliable. In the event that the
Trustee shall receive conflicting directions from two or more groups of Holders,
each with combined holdings of not less than twenty-five percent (25%) of the
principal amount of Outstanding Bonds, the directions given by the group of
Holders which holds the largest percentage of Bonds shall be controlling and the
Trustee shall follow such directions to the extent required herein.
Section 7.10. Power to Appoint Co-Trustees. At any time or times,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Project may at the time be located, the Issuer and the Trustee
shall have power to appoint and, upon the request of the Trustee or of the
Holders of a majority of the aggregate principal amount of the Bonds then
Outstanding, the Issuer shall for such purpose join with the Trustee in the
execution, delivery and performance of all instruments and agreements necessary
or proper to appoint, one or more persons approved by the Trustee and the
Company either to act as co-trustee or co-trustees, jointly with the Trustee of
all or any part of the Project, or to act as separate trustee or separate
co-trustees of all or any part of the Project, and to vest in such person or
persons, in such capacity, such title to the Project or any part thereof, and
such rights, powers, duties, trusts or obligations as the Issuer and the Trustee
may consider necessary or desirable, subject to the remaining provisions of this
section.
The Trustee and co-trustee, if any, may by written instrument
between them designate and assign either the Trustee or
-71-
<PAGE> 76
the co-trustee or both of them to perform all or any part of the
responsibilities and duties of the Trustee under this Indenture.
If the Issuer shall not have joined in such appointment within
thirty (30) days after the receipt by it of a written request to do so, or in
case an Event of Default shall have occurred and be continuing, the Trustee and
the Company shall have the power to make such appointment.
The Issuer shall execute, acknowledge and deliver all such
instruments as may be required by any such co-trustee or separate trustee for
more fully confirming such title, rights, powers, trusts, duties and obligations
to such co-trustee or separate trustee.
Every co-trustee or separate trustee appointed pursuant to this
section, to the extent permitted by law or any applicable contract, shall be
subject to the following terms, namely:
(a) This Indenture shall become effective at the time the Bonds
shall be authenticated and delivered, and thereupon such co-trustee or separate
trustee shall have all rights, powers, trusts, duties and obligations by this
Indenture conferred upon the Trustee in respect of the custody, control or
management of moneys, papers, securities and other personal property.
(b) All rights, powers, trusts, duties and obligations conferred
or imposed upon the trustees shall be conferred or imposed upon and exercised or
performed by the Trustee, or by the Trustee and such co-trustee or co-trustees,
or separate trustee or separate trustees, as shall be provided in the instrument
appointing such co-trustee or co-trustees or separate trustee or separate
trustees, except to the extent that, under the law of any jurisdiction in which
any particular act or acts are to be performed, the Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such act or acts
shall be performed by such co-trustee or co-trustees or separate trustee or
separate trustees.
(c) Any request in writing by the Trustee to any cotrustee or
separate trustee to take or to refrain from taking any action hereunder shall be
sufficient warrant for the taking, or the refraining from taking, of such action
by such co-trustee or separate trustee.
(d) Any co-trustee or separate trustee, to the extent permitted by
law, may delegate to the Trustee the exercise of any right, power, trust, duty
or obligation, discretionary or otherwise.
(e) The Trustee at any time, by an instrument in writing, with the
concurrence of the Company and the Issuer evidenced by a resolution, may accept
the resignation of any cotrustee or separate trustee appointed under this
Section 7.10, and, in case an Event of Default shall have occurred and be
continuing, the Trustee shall
-72-
<PAGE> 77
have power to accept the resignation of, or remove, any such co-trustee or
separate trustee without the concurrence of the Issuer and the Company. Upon the
request of the Trustee, the Issuer and the Company shall join with the Trustee
in the execution, delivery and performance of all instruments and agreements
necessary or proper to effectuate such resignation or removal. A successor to
any co-trustee or separate trustee so resigned or removed may be appointed in
the manner provided in this Section 7.10.
(f) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of any other trustee
hereunder.
(g) Any moneys, paper, securities or other items of personal
property received by any such co-trustee or separate trustee hereunder shall
forthwith, so far as may be permitted by law, be turned over to the Trustee.
Upon the acceptance in writing of such appointment by any such
co-trustee or separate trustee, it or he shall be vested with the security
interest in the Security and with such rights, powers, duties, trusts or
obligations, as shall be specified in the instrument of appointment jointly with
the Trustee (except insofar as applicable law makes it necessary for any such
cotrustee or separate trustee to act alone) subject to all the terms of this
Indenture. Every such acceptance shall be filed with the Trustee. If the Bonds
are rated by a Rating Agency, any cotrustee and separate trustee shall be a bank
or trust company whose bank deposit obligations are rated at least Baa-3/P-3 or
otherwise be acceptable to such Rating Agency.
In case any co-trustee or separate trustee shall die, become
incapable of acting, resign or be removed, the security interest in the Security
and all rights, powers, trusts, duties and obligations of said co-trustee or
separate trustee shall, so far as permitted by law, vest in and be exercised by
the Trustee unless and until a successor co-trustee or separate trustee shall be
appointed in the same manner as provided for with respect to the appointment of
a successor Trustee pursuant to Section 7.4 hereof.
Section 7.11. Filing of Financing Statements. The Company shall
file or record or cause to be filed or recorded all Financing Statements that
are required in order fully to protect and preserve the security interests and
the priority thereof and the rights and powers of the Trustee in connection
therewith, including without limitation all continuation statements for the
purpose of continuing without lapse the effectiveness of (i) those Financing
Statements which shall have been filed at or prior to the issuance of the Bonds
in connection with the security for the Bonds pursuant to the authority of the
U.C.C., and (ii) any previously filed continuation statements that shall have
been filed as required herein. The Issuer and the Trustee shall sign, and the
Trustee shall deliver to the Company or its designee, all such Financing
Statements as may be required for the purposes specified in the preceding
sentence. Upon the filing of any such Financing Statement
-73-
<PAGE> 78
the Company shall immediately notify the Issuer and the Trustee that the same
has been accomplished and deliver to the Issuer and the Trustee an opinion of
Counsel to the effect that such filings are sufficient to maintain perfection
and priority of the security interests granted in this Indenture.
Section 7.12. Remarketing Agent. At the request of the Company,
Wachovia Bank of Georgia, National Association is hereby appointed as the
initial Remarketing Agent. The Issuer, at the direction of the Company, and with
the consent of the Credit Issuer, which consent shall not be unreasonably
withheld, shall appoint any successor Remarketing Agent for the Bonds, subject
to the conditions set forth in Section 7.13. Any Remarketing Agent shall
designate to the Issuer and the Trustee its principal office for purposes
hereof, which shall be the office of such Remarketing Agent at which all notices
and other communications in connection herewith may be delivered to it, and
signify its acceptance of the duties and obligations imposed upon it hereunder
by a written instrument of acceptance delivered to the Issuer, the Company, the
Trustee and the Credit Issuer under which such Remarketing Agent shall agree
particularly (i) to hold all Bonds delivered to it hereunder in trust for the
benefit of the respective Holders of Bonds that delivered such Bonds until
moneys representing the Purchase Price of such Bonds are delivered to or for the
account of or to the order of such Holders of Bonds; (ii) to hold all moneys
delivered to it hereunder for the purchase of Bonds in trust for the benefit of
the person or entity that has delivered such moneys until the Bonds purchased
with such moneys are delivered to or for the account of such person or entity;
and (iii) to keep books and records with respect to its activities hereunder
available for inspection by the Issuer, the Trustee, the Company and the Credit
Issuer, if any, at all reasonable times.
Section 7.13. Qualifications of Remarketing Agent; Resignation;
Removal. The Remarketing Agent shall be a financial institution or registered
broker/dealer authorized by law to perform all the duties imposed upon it by
this Indenture. The Remarketing Agent may at any time resign and be discharged
of its duties and obligations created by this Indenture by giving at least
thirty (30) days notice to the Issuer, the Company, the Tender Agent, the Paying
Agent, the Trustee and the Credit Issuer, if any. The Remarketing Agent may be
removed at any time, upon not less than thirty (30) days' notice, at the
direction of the Company, by an instrument signed by the Issuer and the Company
and filed with the Remarketing Agent, the Trustee, the Paying Agent, the Tender
Agent and the Credit Issuer, if any; provided that no such removal shall be
effective until a successor Remarketing Agent has been appointed in accordance
with this Section and Section 7.12. If the Bonds are rated by a Rating Agency,
any successor Remarketing Agent shall be a bank or trust company whose
outstanding bank deposit obligations are rated at least Baa-3/P-3 or otherwise
be acceptable to such Rating Agency.
Section 7.14. Several Capacities. Anything in this Indenture to
the contrary notwithstanding, the same entity may
-74-
<PAGE> 79
serve hereunder as the Trustee, the Credit Issuer, the Paying Agent, the Tender
Agent, the Registrar and the Remarketing Agent and in any other combination of
such capacities, to the extent permitted by law.
Section 7.15. Trustee Not Responsible for Duties of Remarketing
Agent, Tender Agent, Registrar and Paying Agent. Notwithstanding anything to the
contrary in this Indenture, the Trustee shall not be liable or responsible for
any of the duties or obligations of the Remarketing Agent, the Tender Agent, the
Registrar or the Paying Agent under this Indenture (or be liable or responsible
for the acts or omissions of the Paying Agent, the Tender Agent, the Registrar
or the Remarketing Agent or any action taken by the Trustee or failure to act in
reasonable reliance upon any action or failure to act by the Paying Agent, the
Tender Agent, the Registrar or the Remarketing Agent) except for the duties
imposed upon, or the acts and omissions of, the Trustee as the Tender Agent or
the Paying Agent after receipt of the written notice provided for in Section
7.8(c) to the effect that a successor agent has not been appointed by the
Issuer. The Trustee shall not be bound to ascertain or inquire as to the truth
or accuracy of any information provided to it by the Paying Agent, the Tender
Agent, the Registrar or the Remarketing Agent but may for any purpose
conclusively rely upon any information given to the Trustee by the Paying Agent,
the Tender Agent, the Registrar or the Remarketing Agent.
Section 7.16. Cooperation of the Issuer. Subject to the provisions
of Section 9.9, the Issuer shall cooperate with the Trustee, the Paying Agent,
the Tender Agent, the Registrar, the Remarketing Agent and the Company, if
requested to do so by the Trustee or the Company and to the extent it may
lawfully do so, to cause the necessary arrangements to be made and to be
thereafter continued whereby funds from the sources specified in Section 4.4
will be made available to pay the Purchase Price of Bonds presented to the
Tender Agent.
Section 7.17. Cooperation of the Trustee, the Tender Agent, the
Registrar and the Paying Agent. The Trustee, the Tender Agent, the Registrar and
the Paying Agent shall cooperate in all respects and shall provide to the other
in a timely fashion the information and knowledge each possesses so that the
Trustee and each of such parties may faithfully exercise their respective
obligations hereunder.
ARTICLE VIII
AMENDMENTS, SUPPLEMENTAL INDENTURES
Section 8.1. Supplemental Indentures. The Issuer and the Trustee,
with the consent of the Credit Issuer, if any, but without the consent of or
notice to any Holders, may enter into an indenture or indentures supplemental to
this Indenture that do not
-75-
<PAGE> 80
materially adversely affect the interest of the Holders for one or more of the
following purposes:
(a) to grant to or confer upon the Trustee for the benefit of the
Holders and the Credit Issuer, if any, any additional rights, remedies, powers
or authority that may lawfully be granted to or conferred upon the Holders or
the Trustee;
(b) to grant or pledge to the Trustee for the benefit of Holders
and such Credit Issuer, if any, any additional security other than that granted
or pledged under this Indenture; provided that no additional security shall be
granted or pledged to the Trustee for the benefit of such Credit Issuer unless
such Credit Issuer agrees that the Trustee shall hold such security in trust for
the equal or ratable benefit of such Credit Issuer, on the one hand, and the
Holders, on the other hand;
(c) to modify, amend or supplement this Indenture or any indenture
supplemental hereto in such manner as to permit the qualification thereof under
the Trust Indenture Act of 1939 or any similar federal statute then in effect or
to permit the qualification of the Bonds for sale under the securities laws of
any of the states of the United States;
(d) to appoint a successor Trustee, separate trustees or
co-trustees in the manner provided in Article VII hereof;
(e) to modify, amend or supplement this Indenture for the purpose
of obtaining or retaining a rating on the Bonds from a Rating Agency;
(f) to modify, amend or supplement this Indenture to provide that
the Bonds will be registered under a Book Entry System and to facilitate the
registration of the Bonds under such a system;
(g) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture that may be
defective or inconsistent with any provision contained herein or in any
supplemental indenture, or to make such other provisions in regard to matters or
questions arising under this Indenture which shall not materially adversely
affect the interest of the Holders or such Credit Issuer, if any;
(h) to modify, amend or supplement this Indenture to permit the
Paying Agent, the Tender Agent or the Registrar to assume any administrative
duties of the Trustee hereunder (except any duties of the Trustee with respect
to the acceptance, modification, reduction or release of or drawing on, any
Credit Facility) or for the Trustee to assume any administrative duties of the
Paying Agent or the Registrar hereunder;
(i) to make any change herein necessary, in the opinion of Bond
Counsel, to maintain the exclusion from gross income for
-76-
<PAGE> 81
federal income tax purposes of the interest on any Outstanding Bonds; and
(j) to make any change to the administrative provisions hereof, to
accommodate the provisions of an Alternate Credit Facility.
When requested by the Issuer, and if all conditions precedent
under this Indenture have been met, the Trustee shall join the Issuer in the
execution of any such supplemental indenture unless it imposes additional
obligations on the Trustee or adversely affects the Trustee's rights and
immunities under this Indenture or otherwise. A copy of all such supplemental
indentures shall be promptly furnished to the Credit Issuer and the Paying
Agent, and the Tender Agent and the Registrar shall be promptly advised of any
modifications of their rights, duties and obligations hereunder.
The Trustee shall file copies of all such supplemental indentures
with the Company and, if the Bonds are rated by a Rating Agency, shall forward
copies of all such supplemental indentures to such Rating Agency.
Section 8.2. Amendments to Indenture: Consent of Holders, the
Credit Issuer and the Company. Exclusive of supplemental indentures covered by
Section 8.1 and subject to the terms and provisions contained in this Section
8.2, and not otherwise, the Holders of a majority in aggregate principal amount
of the Bonds then Outstanding and affected by such indenture or indentures
supplemental hereto, with the consent of the Credit Issuer, if any, shall have
the right, from time to time, anything contained in this Indenture to the
contrary notwithstanding, to consent to and direct the execution by the Trustee
of such other indenture or indentures supplemental hereto as shall be consented
to by the Issuer in its sole discretion for the purpose of modifying, altering,
amending, adding to or rescinding, in any particular, any of the terms or
provisions contained in this Indenture or in any supplemental indenture;
provided, however, that nothing contained in this Section shall permit, or be
construed as permitting, without the consent of the Holders of all Outstanding
Bonds, (a) an extension of the maturity of the principal of, or the mandatory
redemption date of, or interest on, any Bond, or (b) a reduction in the
principal amount of, or the premium or the rate of interest on, any Bond, (c) a
preference or priority of any Bond or Bonds over any other Bond or Bonds, (d)
the creation of a lien prior to the lien of this Indenture, (e) a reduction in
the aggregate principal amount of the Bonds required for any consent to any
supplemental indenture, or (f) a modification or change in the duties of the
Trustee hereunder without the consent of the Trustee. The giving of notice to
and consent of the Holders to any such proposed supplemental indenture shall be
obtained pursuant to Section 8.6.
Anything herein to the contrary notwithstanding, a supplemental
indenture, amendment or other document described under this Article VIII that
affects any rights or obligations of the
-77-
<PAGE> 82
Company shall not become effective unless and until the Company shall have
consented to the execution of such supplemental indenture, amendment or other
document.
The Trustee shall file copies of all such supplemental indentures
with the Company and, if the Bonds are rated by a Rating Agency, shall furnish
copies of all such supplemental indentures to such Rating Agency.
Section 8.3. Amendments to to the Agreement Not Requiring Consent
of Holders. The Issuer shall not cause any amendment, modification, supplement,
waiver or consent with respect to the Agreement without the prior written
consent of the Trustee. The Issuer may, with the consent of the Credit Issuer,
if any, but without the consent of or notice to any of the Holders, enter into
or permit (and the Trustee shall consent to) any amendment of the Agreement
acceptable to the Company as may be required (i) for the purpose of curing any
ambiguity or formal defect or omission that shall not adversely affect the
interest of the Holders, (ii) to grant or pledge to the Issuer or Trustee, for
the benefit of the Holders or the Credit Issuer, if any, any additional
security, (iii) to modify, amend or supplement the Agreement for the purpose of
obtaining or retaining a rating on the Bonds from a Rating Agency, (iv) to make
any change therein necessary, in the Opinion of Bond Counsel, to maintain the
exclusion from gross income for federal income tax purposes of interest on any
outstanding Bonds or (v) in connection with any other change therein which, in
the judgment of the Trustee acting in reliance upon an opinion of Counsel, is
not materially prejudicial to the interests of the Trustee and the Holders of
the Bonds.
The Issuer and the Company shall file copies of any such
amendments to the Agreement with the Trustee and, if the Bonds are rated by a
Rating Agency, the Trustee shall furnish copies of such amendments to such
Rating Agency.
Section 8.4. Amendments to the Agreement Requiring Consent of
Holders and the Credit Issuer. Except as provided in Section 8.3 hereof, the
Issuer shall not enter into, and the Trustee shall not consent to, any other
modification or amendment of the Agreement, nor shall any such modification or
amendment become effective, without the consent of the Credit Issuer, if any,
and the consent of the Holders of a majority in aggregate principal amount of
the Bonds at the time Outstanding, such consent to be obtained in accordance
with Section 8.6. No such amendment may, without the consent of the Holders of
all the Outstanding Bonds, reduce the amounts or delay the times of payment of
Repayments under the Agreement.
The Issuer and the Company shall file copies of all such
amendments to the Agreement with the Trustee and, if the Bonds are rated by a
Rating Agency, the Trustee shall furnish copies of such amendments to such
Rating Agency.
-78-
<PAGE> 83
Section 8.5. Amendments, Changes and Modifications to the Credit
Facility. Except as otherwise provided in the Agreement or in this Indenture,
subsequent to the initial issuance of the Bonds and prior to payment of the
Bonds in full (or provision for the payment thereof having been made in
accordance with the provisions of this Indenture), no Credit Facility may be
effectively amended, changed or modified without the prior written consent of
the Trustee and the Paying Agent. The Trustee may, without the consent of the
Holders of the Bonds, consent to any amendment of the Credit Facility as may be
required to extend the term thereof or for purposes of curing any ambiguity,
formal defect or omission or obtaining or retaining a rating on the Bonds from a
Rating Agency that, in the Trustee's and the Paying Agent's judgment, does not
prejudice in any material respect the interests of the Holders. Except for such
amendments, and as otherwise provided herein, the Credit Facility may be amended
only with the consent of the Issuer, the Trustee and the Holders of a majority
in aggregate principal amount of outstanding Bonds, except that no such
amendment may be made that would reduce the amounts required to be paid
thereunder, change the time for payment of such amounts or accelerate the
expiration date of the Credit Facility without the written consent of the
Holders of all Outstanding Bonds. The foregoing shall not limit the Trustee's
obligation to send notice to the Credit Issuer to reduce amounts available to be
drawn under a currently effective Credit Facility under the circumstances set
forth therein.
The Trustee shall file copies of all such amendments, changes or
modifications with the Rating Agency, if any, rating the Bonds.
Section 8.6. Notice to And Consent of Holders. If consent of the
Holders is required under the terms of this Indenture for the amendment of this
Indenture, the Agreement or the Credit Facility or for any other similar
purpose, the Trustee shall cause notice of the proposed execution of the
amendment or supplemental indenture to be given by first-class mail, postage
prepaid, to the Holders of the Outstanding Bonds then shown on the Register.
Such notice shall briefly set forth the nature of the proposed amendment,
supplemental indenture or other action and shall state that copies of any such
amendment, supplemental indenture or other document are on file at the principal
office of the Trustee for inspection by all Holders. If, within sixty (60) days
or such longer period as shall be prescribed by the Trustee following the
mailing of such notice, the Holders of a majority or all, as the case may be, of
the principal amount of the Bonds Outstanding by instruments filed with the
Trustee shall have consented to the amendment, supplemental indenture or other
proposed action, then the Trustee may execute such amendment, supplemental
indenture or other document or take such proposed action and the consent of the
Holders shall thereby be conclusively presumed.
ARTICLE IX
MISCELLANEOUS
-79-
<PAGE> 84
Section 9.1. Right of Trustee to Pay Taxes and Other Charges. In
case any tax, assessment or governmental or other charge upon any part of the
Project is not paid as required, the Trustee may and, upon direction of Holders
owning a majority of the principal amount of the Outstanding Bonds, shall,
subject to any indemnity required pursuant to Section 7.1(h) of this Indenture,
pay such tax, assessment or governmental or other charge, without prejudice,
however, to any rights of the Trustee hereunder arising in consequence of such
failure; and any amount at any time so paid under this Section, with interest
thereon from the date of payment until paid at the greater of the rate of
interest borne by the Bonds or the per annum rate of interest announced from
time to time by the bank serving as Trustee as its "prime rate", shall become so
much additional indebtedness secured by this Indenture, shall be given a
preference in payment over the Bonds, and shall be paid out of the Security
(other than from funds obtained from the Credit Facility).
Section 9.2. Limitation of Rights. With the exception of rights
herein expressly conferred, nothing expressed or mentioned in or to be implied
from this Indenture or the Bonds is intended or shall be construed to give to
any Person other than the parties hereto, the Holders, the Credit Issuer and the
Company any legal or equitable right, remedy or claim under or in respect to
this Indenture or any covenants, conditions and provisions herein contained;
this Indenture and all of the covenants, conditions and provisions herein being
intended to be and being for the sole and exclusive benefit of the parties
hereto, the Holders, the Credit Issuer and the Company as herein provided.
Section 9.3. Severability. If any provision of this Indenture is
held to be in conflict with any applicable statute or rule of law or is
otherwise held to be unenforceable for any reason whatsoever, such circumstances
shall not have the effect of rendering the other provision or provisions herein
contained invalid, inoperative, or unenforceable to any extent whatsoever.
The invalidity of any one or more phrases, sentences, clauses or
sections of this Indenture, shall not affect the remaining portions of this
Indenture or any part thereof.
Section 9.4. Notices. Except as otherwise provided herein, it
shall be sufficient service or giving of any notice, request, complaint, demand
or other paper if the same shall be duly mailed by registered or certified mail,
postage prepaid, addressed as set forth below to the Issuer, the Trustee, the
Company, the Remarketing Agent, the Paying Agent, the Tender Agent, the Credit
Issuer, if any, or to any other Person set forth therein; such notice shall be
deemed given on the date of service by hand delivery or on the postmark date if
mailed to the party receiving notice. The Issuer, the Company, any Credit
Issuer, the Trustee, the Tender Agent, the Remarketing Agent and the Paying
Agent by notice given hereunder, may designate any different addresses to which
subsequent notices, certificates or other communications shall be sent.
-80-
<PAGE> 85
To the Issuer: Iowa Finance Authority
100 E. Grand, Suite 250
Des Moines, Iowa 50309
Attention: Chief Financial Officer
with a copy to: Dorsey & Whitney P.L.L.P.
801 Grand, Suite 3900
Des Moines, Iowa 50309
Attention: Jeffrey M. Hurlburt
To the Trustee: First-Citizens Bank & Trust Company
2917 Highwoods Boulevard
Raleigh, North Carolina 27604
Attention: Corporate Trust Department
To the Company: Dixie Bedding Company
1931 Freeman Mill Road
P.O. Box 5386
Greensboro, NC 27435
Attention: Treasurer
With a copy to: Davis, Hockenberg, Wine, Brown, Koehn &
Shors, P.C.
The Financial Center, Suite 2500
666 Walnut Street
Des Moines, Iowa 50309-3993
Attention: Nicholas H. Roby
To the Credit
Issuer: Wachovia Bank of North Carolina, National
Association
301 North Main Street
Winston-Salem, North Carolina 27150
Attention: International Department
With a copy to: Wachovia Bank of North Carolina, National
Association
P.O. Box 21048 (27420)
230 N. Elm Street (27401)
Greensboro, North Carolina
Attention: Mr. Howell D. Nelson
Vice President
To the Remarket-
ing Agent: Wachovia Bank of Georgia,
National Association
Post Office Box 4148 (30302)
191 Peachtree Street, N.E. (30303)
Atlanta, Georgia
Attention: Bond & Money Market Group/
Money Market Desk
To the Paying Agent: Wachovia Bank of North Carolina,
National Association
301 North Main Street
-81-
<PAGE> 86
Winston-Salem, North Carolina 27150
Attention: Bond and Money Market Group/
Bond Operations
To the Tender Wachovia Bank of North Carolina,
Agent: National Association
301 North Main Street
Winston-Salem, North Carolina 27150
Attention: Bond and Money Market Group/
Money Market Desk
To the Rating Moody's Investors Service
Agency (if the Corporate Department, Structured
Bonds are rated Finance Group
by Moody's) 99 Church Street
New York, New York 10007
Section 9.5. Payments Due on Non-Business Days. In any case where
the date of maturity of interest on or premium, if any, or principal of the
Bonds or the date fixed for redemption of any Bonds shall not be a Business Day,
then payment of such interest, premium or principal need not be made on such
date but shall be made on the next succeeding Business Day, with the same force
and effect as if made on the date of maturity or the date fixed for redemption,
and, in the case of such payment, no interest shall accrue for the period from
and after such date.
Section 9.6. Binding Effect. This instrument shall inure to the
benefit of and shall be binding upon the Issuer and the Trustee and their
respective successors and assigns, subject, however, to the limitations
contained in this Indenture.
Section 9.7. Captions. The captions or headings in this Indenture
are for convenience only and in no way define, limit or describe the scope or
intent of any provisions or sections of this Indenture.
Section 9.8. Governing Law. This Indenture shall be governed by
and interpreted in accordance with the laws of the State.
Section 9.9. Limited Liability of Issuer. Notwithstanding anything
to the contrary, any liability for payment of money and any other liability or
obligation which the Issuer may incur under the Bonds, this Indenture, the
Agreement or the Placement Agreement shall not constitute a general obligation
of the Issuer but shall constitute limited obligations of the Issuer payable
solely from and enforced only against the Security.
Section 9.10. Notices to Rating Agency. If the Bonds are rated by
a Rating Agency, the Trustee shall provide written notice to such Rating Agency
with respect to (i) the appointment of any successor Trustee, Remarketing Agent,
Paying Agent or Tender Agent, (ii) the appointment of any agent by the Trustee
to perform any
-82-
<PAGE> 87
material duties of the Trustee under this Indenture, (iii) the expiration,
termination or extension (other than an automatic extension) of any Credit
Facility, (iv) any Fixed Rate Conversion Date or any conversion to a Semiannual
Rate or a Long Term Rate, (v) any material amendment or supplement to this
Indenture, the Credit Facility, the Credit Agreement, the Remarketing Agreement
or the Tender Agent Agreement, and (vi) the payment in full of all of the Bonds.
Failure of the Trustee to provide any such notice shall not have any effect on
the occurrence of such event.
Section 9.11. Execution in Counterparts. This Indenture may be
executed in several counterparts, each of which shall be an original and all of
which shall constitute but one and the same instrument.
-83-
<PAGE> 88
IN WITNESS WHEREOF, the Issuer has caused this Indenture to be
executed in its name and on its behalf by its Chairman or Vice Chairman and its
seal affixed and attested by its Secretary and the Trustee has caused this
Indenture to be executed, sealed and attested in its name by its duly authorized
officers, all as of the day and year first above written.
IOWA FINANCE AUTHORITY
(SEAL) By: /S/ James W. Balmer
-------------------
Title: Chairman
ATTEST:
/S/
-----------------------------
Ted R. Chapler, Secretary
FIRST-CITIZENS BANK TRUST COMPANY,
AS TRUSTEE
(SEAL) By: /S/
------------------------------
Its: Assistant Vice President
ATTEST:
/S/
------------------------------
Title: Assistant Secretary
-84-
<PAGE> 89
ACKNOWLEDGMENT OF ISSUER
STATE OF IOWA
COUNTY OF POLK
Personally appeared before me, the undersigned authority in and
for the jurisdiction aforesaid, the within named James W. Balmer and Ted R.
Chapler, who acknowledged to me that they are Chairman and Secretary,
respectively, of the Iowa Finance Authority (the "Issuer"), and that for and on
behalf of the Issuer and as its act and deed, they signed, sealed and delivered
the above and foregoing instrument on the day and in the year therein mentioned,
they being first duly authorized so to do by the Issuer.
GIVEN under my hand and official seal this, the 8th day of March,
1995.
/S/
-----------------------------------
NOTARY PUBLIC
My Commission Expires:
January 15, 1998
-85-
