UNITED STATES OF AMERICA
BEFORE THE SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
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:
In the Matter of : CERTIFICATE PURSUANT
: TO
SYSTEM ENERGY RESOURCES, INC. : RULE 24
:
File No. 70-8511 :
:
(Public Utility Holding Company Act of 1935) :
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This is to certify, pursuant to Rule 24 under the Public
Utility Holding Company Act of 1935, as amended, that the
transactions described below, which were proposed by System
Energy Resources, Inc. ("Company") in its Application-
Declaration, as amended, in the above file, have been carried out
in accordance with the terms and conditions of and for the
purposes represented by said Application-Declaration, as amended,
and pursuant to the orders of the Securities and Exchange
Commission with respect thereto dated May 9, 1995 (Release No. 35-
26287), August 18, 1995 (Release No. 35-26358) and August 27,
1996 (Release No. 35-26561).
On November 4, 1998, the Company entered into a Loan
Agreement, dated as of October 15, 1998, with Mississippi
Business Finance Corporation ("MBFC"), pursuant to which MBFC
issued and sold, by negotiated bid, to Goldman, Sachs & Co.,
Morgan Stanley & Co. Incorporated, Lehman Brothers Inc., BNY
Capital Markets, Inc., CIBC Oppenheimer Corp. and Stephens Inc.,
as underwriters, $216,000,000 in aggregate principal amount of
its 5.875% Pollution Control Revenue Refunding Bonds (System
Energy Resources, Inc. Project) Series 1998.
Attached hereto and incorporated by reference are:
Exhibit B-4(b) - Conformed copy of the Trust
Indenture between MBFC and the Trustee.
Exhibit B-6(b) - Conformed Copy of the Loan
Agreement between the Company and MBFC.
Exhibit F-1(f) - Post-effective opinion of Ann G.
Roy, Senior Counsel - Corporate and
Securities of Entergy Services, Inc.,
counsel for the Company.
Exhibit F-2(f) - Post-effective opinion of Thelen
Reid & Priest LLP, counsel for the
Company.
IN WITNESS WHEREOF, System Energy Resources, Inc. has caused
this certificate to be executed this 11th day of November, 1998.
SYSTEM ENERGY RESOURCES, INC.
By: /s/ Steven C. McNeal
Steven C. McNeal
Vice President and Treasurer
Exhibit B-4(b)
MISSISSIPPI BUSINESS FINANCE CORPORATION
and
THE BANK OF NEW YORK TRUST COMPANY
OF FLORIDA, N.A., as Trustee
TRUST INDENTURE
Dated as of October 15, 1998
Relating to $216,000,000 Pollution Control
Revenue Refunding Bonds
(System Energy Resources, Inc. Project)
Series 1998
<PAGE>
THIS INDENTURE made and entered into as of October 15, 1998,
by and between the MISSISSIPPI BUSINESS FINANCE CORPORATION, a
public corporation duly created and validly existing pursuant to
the Constitution and laws of the State of Mississippi (the
"Issuer"), authorized to exercise the powers conferred by the Act
(as hereinafter defined), and THE BANK OF NEW YORK TRUST COMPANY
OF FLORIDA, N.A., Jacksonville, Florida, a bank duly organized,
existing and authorized to accept and execute trusts of the
character herein set out under and by virtue of the laws of the
United States of America, as Trustee (the "Trustee").
RECITALS
WHEREAS, the Issuer is authorized by the provisions of
Sections 57-10-201 et seq., Mississippi Code of 1972, as amended
and supplemented (the "Act"), among other things, to provide
financial assistance to businesses in the State of Mississippi by
providing loans, guarantees, insurance and other assistance to
businesses, thereby encouraging the investment of private capital
in businesses in the State of Mississippi, and to finance such
assistance to businesses by the issuance of revenue bonds; and
WHEREAS, pursuant to its statutory powers, Claiborne County,
Mississippi (the "County") has entered into an Installment Sale
Agreement, dated as of December 1, 1983, with System Energy
Resources, Inc., formerly Middle South Energy, Inc., a
corporation organized and existing under the laws of the State of
Arkansas and qualified to do business as a foreign corporation in
the State of Mississippi (the "Company"), pursuant to which the
County issued and sold its Adjustable/Fixed Rate Pollution
Control Revenue Bonds (Middle South Energy, Inc. Project)
Series A, dated December 1, 1983 (the "Series A Bonds") in the
aggregate principal amount of $49,500,000 in order, inter alia,
to finance the cost of acquiring an undivided 90% interest in
certain air and water pollution control facilities and sewage and
solid waste disposal facilities (the "Project") at the Grand
Gulf Nuclear Electric Generating Station (the "Plant") located in
the County; and
WHEREAS, pursuant to its statutory powers, the County has
entered into an Installment Sale Agreement, dated as of
December 1, 1984 with the Company, pursuant to which the County
issued and sold its Adjustable/Fixed Rate Pollution Control
Revenue Bonds (Middle South Energy, Inc. Project) Series C, dated
December 1, 1984 (the "Series C Bonds") in the aggregate
principal amount of $206,000,000 in order, inter alia, to finance
the cost of acquiring the Project at the Plant; and
WHEREAS, the Issuer and the Company have entered into a Loan
Agreement, dated as of October 15, 1998 (the "Agreement"),
providing that, for the purposes therein set forth, the Issuer
will issue and sell its Bonds (as hereinafter defined) in one or
more series; that the Issuer will loan the proceeds of the Bonds
to the Company; and that to evidence the Loan (as hereinafter
defined) the Company will execute and deliver, concurrently with
the issuance of each series of Bonds, a non-negotiable promissory
note in a like principal amount bearing interest at the same
stated rate or rates of interest as such series of Bonds; and
WHEREAS, the execution and delivery of this Indenture and
the Agreement have been in all respects duly and validly
authorized by a resolution duly adopted by the Board of Directors
of the Issuer (the "Board"); and
WHEREAS, in order to provide funds to currently refund a
portion of the Series A Bonds and all of the Series C Bonds, the
Issuer has duly authorized the issuance and sale of its Pollution
Control Revenue Refunding Bonds (System Energy Resources, Inc.
Project) Series 1998 (hereinafter sometimes called the "Series
1998 Bonds"), in the aggregate principal amount of $216,000,000;
and
WHEREAS, the Issuer has determined that the Series 1998
Bonds and the certificate of authentication by the Trustee and
the certificate of registration and validation to be endorsed on
all the Series 1998 Bonds shall be, respectively, substantially
in the following forms, with such variations, omissions and
insertions as are required or permitted by this Indenture:
[FORM OF BOND]
[ADD DTC LEGEND, IF APPLICABLE]
No. $
Dated Date: October 15, 1998 CUSIP:
UNITED STATES OF AMERICA
STATE OF MISSISSIPPI
MISSISSIPPI BUSINESS FINANCE CORPORATION
POLLUTION CONTROL REVENUE REFUNDING BOND
(System Energy Resources, Inc. Project)
Series 1998
MISSISSIPPI BUSINESS FINANCE CORPORATION (herein called the
"Issuer"), a public corporation duly created and validly existing
pursuant to the Constitution and laws of the State of
Mississippi, for value received, hereby promises to pay, solely
from the special fund provided therefor as hereinafter set forth,
to Cede & Co. or registered assigns or legal representative, on
the 1st day of April, 2022 (or earlier as hereinafter referred
to), upon the presentation and surrender hereof at the principal
corporate trust office of the Trustee (hereinafter mentioned),
the principal sum of
Dollars
($ ) in any coin or currency of
the United States of America which on the date of payment thereof
is legal tender for the payment of public and private debts, and
to pay, solely from said special fund, to the registered owner
hereof by check or draft mailed to the registered owner at his
address as it appears on the bond registration books of the
Issuer, interest on said principal sum from the latest semiannual
interest payment date to which interest has been paid on Bonds of
this series preceding the date hereof, unless the date hereof is
an interest payment date to which interest is being paid, in
which case from the date hereof, or unless the date hereof is
prior to April 1, 1999, in which case from October 15, 1998, at
the rate of five and seven-eighths percent (5.875%) per annum
until payment of said principal sum, such interest being payable
semiannually on the 1st days of April and October (commencing
April 1, 1999) in each year in like coin or currency.
The interest payable on any April 1 or October 1 will,
subject to certain exceptions provided in the Indenture
(hereinafter mentioned), be paid to the person in whose name this
Bond is registered at the close of business on the record date,
which shall be the March 15 or September 15, as the case may be,
next preceding such interest payment date or, if such March 15 or
September 15 shall be a legal holiday or a day on which banking
institutions in Jacksonville, Florida, are authorized to close,
the next preceding day which shall not be a legal holiday or a
day on which such institutions are so authorized to close.
The Issuer is a public corporation duly created and validly
existing pursuant to the Constitution and laws of the State of
Mississippi. The Bonds (hereinafter mentioned) are authorized to
be issued for purposes for which bonds are authorized to be
issued under the provisions of Sections 57-10-201 et seq.,
Mississippi Code of 1972, as amended and supplemented (the
"Act"). This Bond and the interest hereon shall not be deemed to
constitute a debt, liability or obligation of the Issuer or the
State of Mississippi or any political subdivision thereof, or a
pledge of the faith and credit of the Issuer or the State of
Mississippi or any political subdivision thereof, but this Bond
shall be payable solely from the revenues provided therefor as
hereinafter described and the Issuer is not obligated to pay this
Bond or the interest hereon except from the revenues and proceeds
pledged therefor and neither the faith and credit nor the taxing
power of the Issuer or the State of Mississippi or any political
subdivision thereof is pledged to the payment of the principal of
or the redemption premium, if any, or interest on this Bond. No
covenant or agreement contained in this Bond shall be deemed to
be a covenant or agreement of any member, officer, agent or
employee of the Issuer in his individual capacity and no member
of the Board of Directors of the Issuer nor any officer of the
Issuer executing this Bond shall be liable personally on this
Bond or be subject to any personal liability in connection with
the issuance of this Bond.
This Bond is one of a duly authorized series of revenue
refunding bonds of the Issuer known as "Pollution Control Revenue
Refunding Bonds (System Energy Resources, Inc. Project) Series
1998", issued for the purpose of currently refunding a portion of
$49,500,000 Claiborne County, Mississippi Adjustable/Fixed Rate
Pollution Control Revenue Bonds (Middle South Energy, Inc.
Project) Series A and all of $206,000,000 Claiborne County,
Mississippi Adjustable/Fixed Rate Pollution Control Revenue Bonds
(Middle South Energy, Inc. Project) Series C, issued in order to
finance the cost of acquiring an undivided 90% interest in
certain air and water pollution control facilities and sewage and
solid waste disposal facilities at the Grand Gulf Nuclear
Electric Generating Station located in Claiborne County,
Mississippi. The Bonds of this series initially authorized
aggregate Two Hundred Sixteen Million and No/100ths Dollars
($216,000,000) in principal amount. The Indenture provides for
the issuance, under the conditions, limitations and restrictions
therein set forth, of additional Bonds for the purpose of
refunding Bonds of any series issued under the Indenture.
The Bonds of this series and all such additional Bonds
(herein called collectively the "Bonds") are issued or are to be
issued under and pursuant to a trust indenture (said trust
indenture, together with all trust indentures supplemental
thereto as therein permitted, being herein called the
"Indenture"), dated as of the l5th day of October, 1998, by and
between the Issuer and The Bank of New York Trust Company of
Florida, N.A., as Trustee (said bank and any successor trustee
under the Indenture being herein called the "Trustee"), an
executed counterpart of which Indenture is on file at the
principal office of the Trustee. Reference is hereby made to the
Indenture for the provisions, among others, with respect to the
custody and application of the proceeds of Bonds issued under the
Indenture, the collection and disposition of revenues, a
description of the funds charged with and pledged to the payment
of the principal of and redemption premium, if any, and interest
on the Bonds, the nature and extent of the security, the terms
and conditions under which the Bonds are or may be issued, the
rights, duties and obligations of the Issuer and of the Trustee,
the rights of the holders of the Bonds and the terms and
conditions pursuant to which the Indenture and the Agreement
(hereinafter mentioned) may be amended, and, by the acceptance of
this Bond, the holder hereof assents to all of the provisions of
the Indenture.
This Bond is issued and the Indenture was made and entered
into under and pursuant to the Constitution and laws of the State
of Mississippi, and particularly the Act, and under and pursuant
to resolutions duly adopted by the Issuer.
The Issuer has entered into a Loan Agreement, dated as of
October 15, 1998 (herein called the "Agreement"), with System
Energy Resources, Inc., a corporation organized and existing
under the laws of the State of Arkansas and qualified to do
business as a foreign corporation in the State of Mississippi
(herein called the "Company"), under the provisions of which the
Issuer has loaned the proceeds of the Bonds of this series to the
Company and has agreed to loan the proceeds of any additional
series of Bonds to the Company (herein called the "Loan"). In
order to evidence the Loan and the Company's repayment
obligation, the Company has executed and delivered its non-
negotiable promissory note and has agreed to issue additional
such notes concurrently with the issuance of any additional
series of Bonds (herein called the "Notes"). The Notes provide
for the repayment by the Company of the Loan, including interest
thereon, in installments sufficient to pay the principal of and
redemption premium, if any, and interest on the Bonds as the same
shall become due and payable. The Notes provide that the amounts
so to be paid thereunder shall be paid directly to the Trustee as
assignee of the Issuer; such payments are to be deposited to the
credit of the Bond Fund as defined in and created under the
Indenture which special fund is pledged to and charged with the
payment of the principal of and redemption premium, if any, and
interest on all Bonds issued under the Indenture and such amounts
so to be paid thereunder have been duly pledged and assigned for
that purpose. In addition, certain other rights of the Issuer
under the Agreement have been assigned to the Trustee to secure
payment of such principal, redemption premium, if any, and
interest under the Indenture.
The Bonds are issuable as fully registered Bonds without
coupons in denominations of $5,000 or any integral multiple
thereof. At the principal corporate trust office of the Trustee,
in the manner and subject to the limitations, conditions and
charges provided in the Indenture, Bonds may be exchanged for an
equal aggregate principal amount of Bonds of the same maturity,
of authorized denominations and bearing interest at the same
rate.
The Bonds of this series are subject to optional redemption
by the Issuer, at the written direction of the Company pursuant
to Section 4.9 of the Agreement, prior to maturity on or after
October 1, 2003, in whole or in part at any time (but if in part
by lot or in such other random manner as the Trustee in its
discretion may determine), at the redemption prices (expressed as
percentages of principal amount) set forth in the table below,
plus accrued interest to the redemption date:
Optional
Redemption Period Redemption
(all dates inclusive) Price
October 1, 2003 through September 30, 2004 102%
October 1, 2004 through September 30, 2005 101
October 1, 2005 and thereafter 100
The Bonds of this series are also subject to special
optional redemption by the Issuer in the event the Trustee and
the Issuer shall have received written notice from the Company of
its determination of the occurrence of certain events specified
in Section 3.02 of the Indenture. If called for special optional
redemption in such event, the Bonds of this series shall be
subject to redemption at any time, in whole but not in part, at a
redemption price equal to the principal amount thereof plus
accrued interest to the redemption date but without redemption
premium.
The Bonds of this series will also be subject to optional
redemption by the Issuer, at the written direction of the Company
pursuant to Section 4.9 of the Agreement, in whole but not in
part, at any time prior to October 1, 2003, at a redemption price
equal to 102% of the principal amount being redeemed plus accrued
interest to the redemption date, if the Company shall have
consolidated with or merged with or into another corporation, or
sold or otherwise transferred all or substantially all of its
assets.
The Bonds of this series are also subject to mandatory
redemption, at a redemption price equal to the principal amount
being redeemed plus accrued interest to the redemption date, on
the 180th day (or such earlier date as may be designated by the
Company) after a final determination by a court of competent
jurisdiction or an administrative agency to the effect that, as a
result of a failure by the Company to observe any covenant,
agreement or representation contained in the Agreement or the
Issuer to observe any covenant, agreement or representation in
the Indenture, the interest payable on such Bonds is not
excludable for federal income tax purposes from the gross income
of the owners thereof (other than any owner who is a "substantial
user" of the Project or a "related person" within the meaning of
Section 103(b)(13) of the Internal Revenue Code of 1954 (the
"1954 Code"). No determination by any court or administrative
agency will be considered final unless the Company has received
timely notice of and has had an opportunity to participate in the
proceeding which resulted in such determination. The Bonds of
this series will be redeemed, either in whole or in part, in such
principal amount that the interest payable on such Bonds
remaining outstanding after such redemption would not under
Section 103 of the 1954 Code be included in the gross income of
any owner thereof (other than an owner who is a "substantial
user" of the Project or a "related person" within the meaning of
Section 103(b)(13) of the 1954 Code).
Any such redemption, either in whole or in part, shall be
made upon not less than twenty-five (25) days' nor more than
sixty (60) days' prior notice as provided in the Indenture, and
shall be made in the manner and under the terms and conditions
provided in the Indenture. On the date designated for
redemption, notice having been given and moneys for payment of
the redemption price and accrued interest being held by the
Trustee or by the paying agents, all as provided in the
Indenture, the Bonds or portions of Bonds so called for
redemption shall become and be due and payable at the redemption
price provided for redemption of such Bonds or such portions
thereof on such date, interest on such Bonds or such portions
thereof so called for redemption shall cease to accrue, such
Bonds or such portions thereof so called for redemption shall
cease to be entitled to any benefit or security under the
Indenture, and the registered owners thereof shall have no rights
in respect of such Bonds or such portions thereof so called for
redemption except to receive payment of the redemption price and
accrued interest thereon so held by the Trustee or by the paying
agents. If a portion of this Bond shall be called for
redemption, a new registered Bond without coupons in principal
amount equal to the unredeemed portion hereof will be issued to
the registered owner upon the surrender hereof.
The holder of this Bond shall have no right to enforce the
provisions of the Indenture or to institute action to enforce the
covenants therein, or to take any action with respect to any
event of default under the Indenture or to institute, appear in
or defend any suit or other proceeding with respect thereto,
except as provided in the Indenture.
In certain events, on the conditions, in the manner and with
the effect set forth in the Indenture, the principal of all the
Bonds then Outstanding under the Indenture may become or may be
declared due and payable before the stated maturity thereof,
together with the interest accrued thereon.
Modifications or alterations of the Indenture or any trust
indenture supplemental thereto or of the Agreement may be made
only to the extent and in the circumstances permitted by the
Indenture.
The transfer of this Bond may be registered by the
registered owner hereof in person or by his attorney or legal
representative at the principal corporate trust office of the
Trustee, but only in the manner and subject to the limitations
and conditions provided in the Indenture and upon surrender and
cancellation of this Bond. Upon any such registration of trans
fer the Issuer shall execute and the Trustee shall authenticate
and deliver in exchange for this Bond a new registered Bond or
Bonds without coupons, registered in the name of the transferee,
of authorized denominations, in aggregate principal amount equal
to the principal amount of this Bond, of the same series and
maturity and bearing interest at the same rate.
This Bond is issued with the intent that the laws of the
State of Mississippi shall govern its construction. As declared
by the Act and other applicable laws of the State of Mississippi,
this Bond shall have all the qualities and incidents, including
negotiability, of an investment security under the Uniform
Commercial Code of the State of Mississippi.
All acts, conditions and things required to happen, exist
and be performed precedent to and in the issuance of this Bond
and the execution of the Indenture have happened, exist and have
been performed as so required.
This Bond shall not be valid or become obligatory for any
purpose or be entitled to any benefit or security under the
Indenture until it shall have been authenticated by the execution
by the Trustee of the certificate of authentication endorsed
hereon.
IN WITNESS WHEREOF, Mississippi Business Finance
Corporation, by resolution of its Board of Directors, has caused
this Bond to be executed in its name and on its behalf by the
facsimile signature of its Executive Director, and by the manual
or facsimile signature of its Secretary and a facsimile of its
seal to be imprinted hereon.
MISSISSIPPI BUSINESS FINANCE
CORPORATION
(SEAL)
By
Executive Director
Attest:
Secretary
[FORM OF TRUSTEES CERTIFICATE OF AUTHENTICATION]
(To be endorsed on all Bonds)
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds of the series designated
therein and issued under the provisions of the within mentioned
Indenture.
Dated: THE BANK OF NEW YORK TRUST COMPANY
OF FLORIDA, N.A.,
as Trustee
By
Authorized Signature
<PAGE>
[FORM OF REGISTRATION AND VALIDATION CERTIFICATE]
(To be endorsed on all Bonds)
STATE OF MISSISSIPPI
COUNTY OF HINDS
The undersigned, Secretary of the Mississippi Business
Finance Corporation, does hereby certify that the within Bond has
been duly registered by me pursuant to law in a book kept in my
office for that purpose; and that the within Bond has been
validated by decree of the Chancery Court of the First Judicial
District of Hinds County, Mississippi, rendered on the 2nd day of
November, 1998.
Secretary of the Mississippi
Business Finance Corporation
ASSIGNMENT
FOR VALUE RECEIVED
The undersigned hereby sells, assigns and transfers unto
(Please insert name, address and Social Security Number or other
identifying number of Assignee)
the within Bond of the MISSISSIPPI BUSINESS FINANCE CORPORATION
and does hereby constitute and appoint
as attorney to transfer the said Bond on the
books of the within named Issuer, with full power of substitution
in the premises.
Dated:
<PAGE>
Signature guaranteed
Registered Owner
Insert Social Security Number
or Other Tax Identification Notice: Signature(s) to this
Number of Assignor: assignment must correspond
with the name(s) of the
Registered Owner(s) as it
appears on the face of the
within Bond in every
particular, without alteration
or enlargement or any change
whatever and must be
guaranteed by a member firm of
the New York Stock Exchange or
a commercial bank or trust
company who is a member of a
Medallion Signature Guarantee
Program.
[END OF FORM OF BOND]
WHEREAS, all acts, conditions and things required by the
Constitution and laws of the State of Mississippi to happen,
exist and be performed precedent to and in connection with the
execution and delivery of this Indenture and the Agreement have
happened, exist and have been performed as so required, in order
to make this Indenture a valid and binding trust indenture for
the security of the Bonds in accordance with its terms and in
order to make the Agreement a valid and binding agreement in
accordance with its terms; and
WHEREAS, the Trustee has accepted the trusts created by this
Indenture and in evidence thereof has joined in the execution
hereof.
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in
consideration of the premises, of the acceptance by the Trustee
of the trusts hereby created, and the purchase and acceptance of
the Bonds by the holders thereof, and also for and in
consideration of the sum of One Dollar ($1.00) to the Issuer in
hand paid by the Trustee at or before the execution and delivery
of this Indenture, the receipt of which is hereby acknowledged,
and for the purpose of fixing and declaring the terms and
conditions upon which the Bonds are to be issued, authenticated,
delivered, secured and accepted by all persons who shall from
time to time be or become holders thereof, and in order to secure
the payment of all Bonds at any time issued and outstanding
hereunder and the interest and the redemption premium, if any,
thereon according to their tenor, purport and effect, and in
order to secure the performance and observance of all the
covenants, agreements and conditions therein or herein contained;
the Issuer has executed and delivered this Indenture, will cause
the Company to deliver to the Trustee the Company's promissory
note dated the date of the initial issuance of the Series 1998
Bonds, and will cause the Company to deliver any other of its
Notes (as defined in the Agreement) required in connection with
the issuance of Additional Bonds (as hereinafter defined); the
Issuer does hereby bargain, sell, convey, assign and pledge to
the Trustee, and grant to the Trustee a security interest in, all
rights, title and interests of the Issuer in, to and under such
Notes and all payments made and to be made thereunder and all
security for the payment of all outstanding Series 1998 Bonds and
any Additional Bonds and the interest and the redemption premium,
if any, thereon and does hereby bargain, sell, convey, assign and
pledge to the Trustee, and grant to the Trustee a security
interest in, all other rights, title and interests of the Issuer
in, to and under the Agreement and all moneys receivable
thereunder (except for payments to be received under Sections 4.3
and 5.3 of the Agreement) as security for the payment of the
Bonds as aforesaid and the satisfaction of any other obligation
assumed by it in connection with all outstanding Bonds at any
time issued hereunder;
TO HAVE AND TO HOLD the same unto the Trustee and its
successors in trust forever;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set
forth, for the equal and proportionate benefit and security of
all and singular present and future holders of the Bonds issued
and to be issued under this Indenture, without preference,
priority or distinction as to lien or otherwise, except as
otherwise hereinafter provided, of any one Bond over any other
Bond, by reason of priority in the issue, sale or negotiation
thereof or otherwise;
PROVIDED, HOWEVER, that if the Issuer, its successors or
assigns shall pay or cause to be paid the principal of,
redemption premium, if any, and interest on the Bonds due or to
become due thereon, at the times and in the manner mentioned in
the Bonds, and shall cause the payments to be made into the Bond
Fund (as hereinafter defined) as required under Article V hereof
or shall provide, as permitted hereby, for the payment thereof
pursuant to the provisions of Article VII hereof, and shall
perform all the covenants and conditions required of it by this
Indenture, and shall pay or cause to be paid to the Issuer, the
Trustee and any additional paying agents all sums of money due or
to become due to them in accordance with the terms and provisions
hereof, then upon such final payments, except as provided in
Article VII hereof, this Indenture and the rights hereby granted
shall terminate and the Trustee shall release this Indenture and
shall execute such documents to evidence such termination and
release as may be reasonably required by the Issuer or the
Company; otherwise this Indenture to be and remain in full force
and effect.
THIS INDENTURE FURTHER WITNESSETH, and it is expressly
declared, that all Bonds from time to time issued and secured
hereunder are to be issued, authenticated and delivered, and all
said property, rights and interests, including, without
limitation, the amounts hereby assigned and pledged, are to be
dealt with and disposed of subject to the terms of this
Indenture, and the Issuer agrees with the Trustee and with the
respective holders and owners, from time to time, of said Bonds,
or part thereof, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms "Act", "Agreement",
"Board", "Company", "County", "Issuer", "Plant", "Project",
"Series A Bonds" and "Series C Bonds" shall have the same
meanings given and assigned to such words in the Recitals hereto.
The terms "Loan", "Notes" and "Series 1998 Bonds" defined in
Article I of the Agreement shall have the same meanings in this
Indenture. In addition, the following words and phrases shall
have the following meanings:
Additional Bonds
"Additional Bonds" means the bonds authorized to be issued
under Section 2.10 of this Indenture.
Bond Fund
"Bond Fund" means the trust fund created by Section 5.02 of
this Indenture.
Bondholder
"Bondholder" or "holder" or "owner of the Bonds" means the
person or entity in whose name any Bond is registered.
Bonds
"Bonds" means the Series 1998 Bonds authorized to be issued
under Section 2.02 of this Indenture and any Additional Bonds.
Code
"Code" means the Internal Revenue Code of 1986, as amended.
Event of Default
"Event of Default" means any occurrence or event described
in Section 8.01 hereof.
Government Obligations
"Government Obligations" means (a) direct obligations of the
United States of America for the timely payment of which the full
faith and credit of the United States of America is pledged, or
(b) obligations issued by a person controlled or supervised by
and acting as an instrumentality of the United States of America,
the timely payment of the principal of and premium, if any, and
interest on which is fully and unconditionally guaranteed as a
full faith and credit obligation by the United States of America.
Indenture
"Indenture" means this trust indenture and any indenture
supplemental hereto.
1954 Code
"1954 Code" means the Internal Revenue Code of 1954, as
amended.
Outstanding
"Outstanding" or "Bonds Outstanding" or "Bonds then
Outstanding" means all Bonds which have been authenticated and
delivered by the Trustee under this Indenture, except:
(a) Bonds cancelled after purchase or because of payment at
or redemption prior to maturity;
(b) Bonds for the payment or redemption of which all
necessary moneys or Government Obligations shall have been
theretofore deposited with the Trustee (whether upon or prior to
the maturity or redemption date of any such Bonds);
provided that, if such Bonds are to be redeemed prior to the
maturity thereof, notice of such redemption shall have been given
or arrangements satisfactory to the Trustee shall have been made
therefor, pursuant to the terms hereof, or waiver of such notice
satisfactory in form to the Trustee shall have been filed with
the Trustee;
(c) Bonds in exchange for which, or upon the transfer of
which, other Bonds have been authenticated under Section 2.05
hereof; and
(d) Bonds in lieu of which other Bonds have been
authenticated under Sections 2.07 and 2.08 hereof.
Rebate Agreement
"Rebate Agreement" has the meaning set forth in Section 5.09
hereof.
Securities Depository
"Securities Depository" means a recognized securities
depository (or its successor or substitute) selected by the
Issuer to act as the securities depository maintaining a book
entry system for a particular series of Bonds.
Securities Depository Nominee
"Securities Depository Nominee" means, with respect to a
particular series of Bonds and as to any Securities Depository,
such Securities Depository or the nominee of such Securities
Depository in whose name the Bonds of such series shall be
registered on the registration books of the Issuer during the
time such series of Bonds are held under a book entry system
through such Securities Depository.
Trustee
"Trustee" means the trustee serving as such under this
Indenture, including any successor Trustee serving or appointed
pursuant to Sections 9.05 or 9.08 hereof.
ARTICLE II
THE BONDS
SECTION 2.01. Authorized Amount of Bonds. No Bonds may be
issued under the provisions of this Indenture except in
accordance with this Article II.
SECTION 2.02. Issuance of Bonds. There shall be initially
issued under and secured by this Indenture Bonds of the Issuer,
in the aggregate principal amount of Two Hundred Sixteen Million
and No/100ths Dollars ($216,000,000) for the purpose of currently
refunding a portion of the Series A Bonds and all of the Series C
Bonds related to the refinancing of the acquisition of the
Project. Said Bonds shall be designated "Pollution Control
Revenue Refunding Bonds (System Energy Resources, Inc. Project)
Series 1998", shall bear interest (calculated on the basis of a
year of 360 days and twelve 30-day months) at the rate of five
and seven-eighths per centum (5.875%) per annum, which interest
shall be payable semi-annually on the 1st days of April and
October in each year, commencing April 1, 1999, and shall mature,
subject to prior redemption as hereinafter set forth, on the 1st
day of April, 2022.
SECTION 2.03. Form of Bonds. The definitive Bonds are
issuable as fully registered Bonds without coupons in
denominations of $5,000 or any integral multiple thereof. The
definitive Bonds shall be substantially in the form hereinabove
set forth, with such appropriate variations, omissions and
insertions as are permitted or required by this Indenture and may
have endorsed thereon such legends or text as may be necessary or
appropriate to conform to any applicable rules and regulations of
any governmental authority or any usage or requirement of law
with respect thereto.
SECTION 2.04. Details, Execution and Payment. Each Bond of
each series shall be dated as of the date of authentication, and
shall bear interest from the latest semi-annual interest payment
date to which interest has been paid on the Bonds of such series
preceding the date of authentication, unless such date of
authentication is an interest payment date to which interest is
being paid on the Bonds of such series, in which case it shall
bear interest from such date of authentication, provided that
Bonds of each series authenticated prior to the first interest
payment date of such series shall bear interest from a date
specified for such series, which date, in the case of the Series
1998 Bonds, shall be October 15, 1998.
The Bonds shall be executed by the manual or facsimile
signature of the Executive Director of the Issuer and by the
manual or facsimile signature of its Secretary and the seal of
the Issuer or a facsimile thereof shall be affixed thereto or
imprinted thereon.
All authorized facsimile signatures shall have the same
force and effect as manual signatures.
In case any officer whose signature or facsimile signature
shall appear on any Bonds shall cease to be such officer before
the delivery of such Bonds, such signature or such facsimile
signature shall nevertheless be valid and sufficient for all
purposes as if such officer had remained in office until such
delivery, and also any Bond may be signed by or bear the
facsimile signature of such persons as at the actual time of the
execution of such Bond shall be the proper officers to sign such
Bond although at the date of delivery of such Bond such persons
may not have been such officers.
The principal of and redemption premium, if any, and
interest on the Bonds shall be payable on or before the
respective dates of payment therefor in any coin or currency of
the United States of America which on the respective dates of
payment thereof is legal tender for the payment of public and
private debts. The principal of and redemption premium, if any,
on all Bonds shall be payable at the principal corporate trust
office of the Trustee, and payment of the interest on each Bond
shall be made by the Trustee on each interest payment date to the
person appearing on the registration books of the Issuer
hereinafter provided for as the owner thereof, by check or draft
mailed to such owner at his address as it appears on such
registration books. Payment of the principal of and redemption
premium, if any, on all Bonds shall be made upon the presentation
and surrender of such Bonds as the same shall become due and
payable.
The person in whose name any Bond of any series is
registered at the close of business on any record date (as
hereinafter defined) with respect to any interest payment date
for the Bonds of such series shall be entitled to receive the
interest payable on such interest payment date notwithstanding
the cancellation of such Bond upon any transfer or exchange
thereof subsequent to the record date and prior to such interest
payment date, except if and to the extent there shall be a
default in the payment of the interest due on such interest
payment date, in which case such defaulted interest shall be paid
to the person in whose name such Bond (or any Bond or Bonds
issued, directly or after intermediate transactions, upon
transfer or exchange or in substitution thereof) is registered on
a subsequent record date for such payment established as
hereinafter provided. A subsequent record date may be
established by the Issuer at the direction of the Company by
notice mailed to the Trustee and the holders of the Bonds of the
affected series not less than ten days preceding such record
date, which record date shall not be less than five nor more than
thirty days prior to the subsequent interest payment date. The
term "record date" as used in this Section 2.04 with respect to
any regular interest payment date shall mean the fifteenth day of
the month next preceding such interest payment date, if such
interest payment date shall be the first day of a month, or the
first day of the month in which such interest payment date shall
fall, if such interest payment date shall be the fifteenth day of
a month, or, if such day shall be a legal holiday or a day on
which banking institutions in Jacksonville, Florida are
authorized by law to close, the next preceding day which shall
not be a legal holiday or a day on which such institutions are so
authorized to close.
SECTION 2.05. Authentication, Registration, Exchange,
Transfer and Ownership of Bonds. Only such of the Bonds as
shall have endorsed thereon a certificate of authentication
substantially in the form hereinabove set forth, duly executed by
the Trustee, shall be entitled to any benefit or security under
this Indenture. No Bond shall be valid or obligatory for any
purpose unless and until such certificate of authentication shall
have been duly executed by the Trustee, and such certificate of
the Trustee upon any such Bond shall be conclusive evidence that
such Bond has been duly authenticated and delivered under this
Indenture. The Trustee's certificate of authentication on any
Bond shall be deemed to have been duly executed if signed by an
authorized representative of the Trustee, but it shall not be
necessary that the same officer sign the certificate of
authentication on all of the Bonds that may be issued hereunder
at any one time.
Bonds, upon surrender thereof at the principal corporate
trust office of the Trustee, together with an assignment duly
executed by the owner or his attorney or legal representative in
such form as shall be satisfactory to the Trustee, may, at the
option of the owner thereof, be exchanged for an equal aggregate
principal amount of Bonds of the same series and maturity, of any
denomination or denominations authorized by this Indenture, and
bearing interest at the same rate.
The Trustee is hereby appointed as bond registrar (the "Bond
Registrar") and as such shall keep books for the registration and
for the registration of transfer of Bonds as provided in this
Indenture.
The transfer of any Bond may be registered only upon the
books kept for the registration and registration of transfer of
Bonds upon surrender thereof to the Bond Registrar together with
an assignment duly executed by the owner or his attorney or legal
representative in such form as shall be satisfactory to the Bond
Registrar. Upon any such registration of transfer, the Issuer
shall execute and the Trustee shall authenticate and deliver in
exchange for such Bond a new Bond or Bonds, registered in the
name of the transferee, of any denomination or denominations
authorized by this Indenture in an aggregate principal amount
equal to the principal amount of such Bond of the same series and
maturity and bearing interest at the same rate.
In all cases in which Bonds shall be exchanged or the
transfer of Bonds shall be registered hereunder, the Issuer shall
execute and the Trustee shall authenticate and deliver at the
earliest practicable time Bonds in accordance with the provisions
of this Indenture. All Bonds surrendered in any such exchange or
registration of transfer shall forthwith be cancelled by the
Trustee. The Issuer or the Trustee may make a charge for every
such exchange or registration of transfer of Bonds sufficient to
reimburse it for any tax, fee or other governmental charge
required to be paid with respect to such exchange or registration
of transfer, and such charge shall be paid before any such new
Bonds shall be delivered.
As to any Bond, the person in whose name the same shall be
registered shall be deemed and regarded as the absolute owner
thereof for all purposes, and payment of or on account of the
principal of or redemption premium, if any, or interest on any
such Bond shall be made only to or upon the order of the owner
thereof or his legal representative. All such payments shall be
valid and effectual to satisfy and discharge the liability upon
such Bond, including the interest thereon, to the extent of the
sum or sums so paid. Neither the Issuer, the Trustee, the
Company nor the Bond Registrar shall be affected by any notice to
the contrary.
SECTION 2.06. Delivery of Series 1998 Bonds; Application of
Proceeds. (a) Upon the execution and delivery of this Indenture,
the Issuer shall execute and deliver to the Trustee and the
Trustee shall authenticate the Series 1998 Bonds and deliver them
to the purchasers thereof against payment therefor as directed by
the Issuer as hereinafter in this Section 2.06 provided.
(b) Prior to the delivery by the Trustee of the Series 1998
Bonds, there shall be delivered to the Trustee:
(1) A copy, certified by the Secretary of the Issuer,
of the resolutions adopted by the Board authorizing the
execution and delivery of the Agreement, authorizing the
acceptance and assignment of a Note relating to the Series
1998 Bonds, and authorizing the execution and delivery of
this Indenture and the issuance of the Series 1998 Bonds.
(2) An executed counterpart of the Agreement.
(3) A certificate of the Company stating that the
Company has approved the issuance of the Series 1998 Bonds
and the price thereof as required by Section 2.2 of the
Agreement.
(4) A request and authorization to the Trustee on
behalf of the Issuer, signed by the Executive Director of
the Issuer, to authenticate and deliver the Series 1998
Bonds to the purchasers thereof identified upon payment to
the Trustee, but for the account of the Issuer, of a sum
specified in such request and authorization.
(5) A Note relating to the Series 1998 Bonds duly
executed on behalf of the Company and assigned to the
Trustee.
(6) An opinion of nationally recognized counsel
experienced on the subject of municipal bonds that the
interest on the Series 1998 Bonds is excluded from gross
income for federal income tax purposes, except for interest
on any Series 1998 Bond for any period during which it is
held by a person who is a "substantial user" of the Project
or a "related person" as defined in the 1954 Code.
(7) A copy of the request filed by the Company with
the County for the redemption of the principal amount of the
Series A Bonds and the Series C Bonds set forth therein, and
a certified copy of the resolution of the County calling
such Series A Bonds and the Series C Bonds for redemption.
(c) Upon the issuance and delivery of the Series 1998
Bonds, the Trustee shall apply the proceeds from the sale of the
Series 1998 Bonds as follows:
(1) The accrued interest (if any) received from the
sale of the Series 1998 Bonds shall be deposited into the
Bond Fund;
(2) $9,925,000 of such proceeds shall be deposited
with the trustee under the Trust Indenture, dated as of
December 1, 1983, pursuant to which the Series A Bonds were
issued and secured, and shall be applied solely to the
redemption of a portion of the Series A Bonds within 90 days
after the date of initial issuance of the Series 1998 Bonds;
and
(3) $204,455,000 of such proceeds shall be deposited
with the trustee under the Trust Indenture, dated as of
December 1, 1984, pursuant to which the Series C Bonds were
issued and secured, and shall be applied solely to the
redemption of all of the Series C Bonds within 90 days after
the date of initial issuance of the Series 1998 Bonds.
SECTION 2.07. Temporary Bonds. Until definitive Bonds are
ready for delivery, there may be executed, and upon request of
the Issuer, the Trustee shall authenticate and deliver, in lieu
of definitive Bonds and subject to the same limitations and
conditions, temporary printed, engraved, lithographed or
typewritten Bonds, in the form of registered Bonds without
coupons in the denomination of $5,000 or any integral multiple
thereof, substantially of the tenor hereinabove set forth and
with such appropriate omissions, insertions and variations as may
be required.
Until definitive Bonds are ready for delivery, any temporary
Bond may be exchanged at the principal corporate trust office of
the Trustee, without charge to the holder thereof, for an equal
aggregate principal amount of temporary Bonds of like tenor, of
the same series and maturity and bearing interest at the same
rate.
If temporary Bonds shall be issued, the Issuer shall cause
the definitive Bonds to be prepared and to be executed and
delivered to the Trustee, and the Trustee, upon presentation to
it at its principal corporate trust office of any temporary Bond,
shall cancel the same and authenticate and deliver in exchange
therefor at the principal corporate trust office of the Trustee,
without charge to the holder thereof, a definitive Bond or Bonds
of an equal aggregate principal amount, of the same series and
maturity and bearing interest at the same rate as the temporary
Bond surrendered. Until so exchanged the temporary Bonds shall
in all respects be entitled to the same benefit and security of
this Indenture as the definitive Bonds to be issued and
authenticated hereunder.
SECTION 2.08. Mutilated, Destroyed or Lost Bonds. In case
any Bond secured hereby shall become mutilated or be destroyed or
lost, the Issuer shall cause to be executed, and the Trustee
shall authenticate and deliver, a new Bond of like date and tenor
in exchange and substitution for and upon the cancellation of
such mutilated Bond, or in lieu of and in substitution for such
Bond destroyed or lost, upon the holder's paying the reasonable
expenses and charges of the Issuer and the Trustee in connection
therewith and, in the case of a Bond destroyed or lost, his
filing with the Trustee evidence satisfactory to it that such
Bond was destroyed or lost, and of his ownership thereof, and
furnishing the Issuer and the Trustee indemnity satisfactory to
them.
SECTION 2.09. Destruction of Bonds. All Bonds paid,
redeemed or purchased, either at or before maturity, shall be
cancelled upon the payment, redemption or purchase of such Bonds
and shall be delivered to the Trustee when such payment,
redemption or purchase is made. All Bonds cancelled under any of
the provisions of this Indenture shall be destroyed, in
accordance with applicable law, by the Trustee, which shall
execute a certificate in triplicate describing the Bonds so
destroyed, and one executed certificate shall be filed with the
Issuer and one with the Company and the other executed
certificate shall be retained by the Trustee.
SECTION 2.10. Additional Bonds. Additional Bonds may be
issued under and secured by this Indenture at one time or from
time to time, in addition to the Series 1998 Bonds and, subject
to the conditions hereinafter provided in this Section 2.10, for
the purpose of providing funds for refunding any of the Bonds
then Outstanding of any series, including the payment of any
redemption premium thereon, interest to accrue to the selected
redemption date, any serial maturities to become due prior to the
selected redemption date and any expenses in connection with such
refunding (any such Additional Bonds to be identified as
"Refunding Bonds"). Before any Additional Bonds shall be issued
under the provisions of this Section 2.10, the Board shall adopt
a resolution authorizing the issuance of such Additional Bonds,
fixing the amount thereof and designating the outstanding Bonds
to be refunded with the proceeds of such Additional Bonds. Such
Additional Bonds shall be designated, shall be stated to mature
on such date or dates and in such year or years, shall bear
interest, payable on such dates, at such rate or rates not
exceeding the maximum rate then permitted by law, and may be made
redeemable at such times and prices (subject to the provisions of
Article III of this Indenture), as all may be provided by the
resolution authorizing the issuance of such Additional Bonds.
Except as to any difference in the date, the maturity or
maturities, the rate or rates of interest or the provisions for
redemption by sinking fund or otherwise, such Additional Bonds
shall be on a parity with and shall be entitled to the same
benefit and security of this Indenture as the Series 1998 Bonds.
Such Additional Bonds shall be executed substantially in the
form and manner hereinabove set forth and shall be deposited with
the Trustee for authentication, but before such Additional Bonds
shall be authenticated and delivered by the Trustee, there shall
be delivered to the Trustee the following:
(a) A copy, certified by the Secretary of the Issuer, of
the resolution adopted by the Board authorizing the issuance of
such Additional Bonds in the amount specified therein,
authorizing the acceptance and assignment of a Note relating to
such Additional Bonds, and providing for the application of the
proceeds thereof.
(b) A certificate of the Company stating that the Company
has approved the issuance of such Additional Bonds, including the
terms, manner of issuance, purchase price and disposition of the
proceeds thereof, and the terms and conditions of any supplement
to this Indenture entered into in connection with such Additional
Bonds.
(c) An executed counterpart of any amendment to the
Agreement.
(d) An opinion of nationally recognized counsel experienced
on the subject of municipal bonds that the issuance of such
Additional Bonds and the application of the proceeds of such
Additional Bonds to the purpose or purposes described in the
resolution mentioned in clause (a) of this Section 2.10 will not
result in the interest on any Bonds theretofore issued under this
Indenture and then outstanding or any portion thereof becoming
included in gross income for federal income tax purposes, except
as to any such Bond held by a "substantial user" of the Project
or a "related person" within the meaning of the 1954 Code (or any
applicable successor provision of law), and that the interest on
such Additional Bonds will be so excluded from gross income for
federal income tax purposes.
(e) A Note relating to such Additional Bonds duly executed
on behalf of the Company and assigned to the Trustee.
(f) A copy of the request filed by the Company with the
Issuer for the refunding of outstanding Bonds, and a certified
copy of the resolution of the Board with respect to such
refunding.
SECTION 2.11. Book Entry System.
(a) Notwithstanding anything to the contrary herein, so
long as a series of Bonds is being held under a book entry
system, transfers of beneficial ownership of the Bonds of such
series will be effected pursuant to rules and procedures
established by the Securities Depository.
(b) As long as a book entry system is in effect for a
series of Bonds, the Securities Depository Nominee will be
recognized as the holder of the Bonds of such series for the
purposes of (1) paying the principal of, redemption premium, if
any, or interest on such Bonds, (2) if Bonds of such series are
to be redeemed in part, selecting the portions of such Bonds to
be redeemed, (3) giving any notice permitted or required to be
given to holders under this Indenture, (4) registering the
transfer of such Bonds, and (5) requesting any consent or other
action to be taken by the holders of such Bonds, and for all
other purposes whatsoever, and neither the Trustee nor the Issuer
shall be affected by any notice to the contrary.
(c) Neither the Trustee nor the Issuer shall have any
responsibility or obligation to any participant, any beneficial
owner or any other person claiming a beneficial ownership in any
Bonds which are registered to a Securities Depository Nominee
under or through the Securities Depository with respect to any
action taken by the Securities Depository as holder of such
Bonds.
(d) The Trustee shall pay all principal of and redemption
premium, if any, and interest on Bonds issued under a book entry
system, only to the Securities Depository, or the Securities
Depository Nominee, as the case may be, for such Bonds, pursuant
to a letter of representations or similar agreement with the
Securities Depository and all such payments shall be valid and
effectual to fully satisfy and discharge the obligations with
respect to the principal of and redemption premium, if any, and
interest on such Bonds. The Issuer and the Trustee acknowledge
that the terms and provisions of such letter of representations
or similar agreement shall govern in the event of any
inconsistency between the provisions of this Indenture and such
letter of representations or similar agreement.
(e) In the event that the Issuer determines that it is in
the best interest of the Issuer to discontinue the book entry
system of transfer for series of Bonds, or that the interests of
the beneficial owners of the Bonds of such series may be
adversely affected if the book entry system is continued, then
the Issuer shall notify the Securities Depository and the Trustee
of such determination. In such event, the Issuer shall execute
and the Trustee shall authenticate, register and deliver physical
certificates for Bonds of such series in exchange for the Bonds
registered in the name of the Securities Depository Nominee;
provided, in addition, that any Bonds of such series shall be in
registered form within the meaning of Section 149(a) of the Code.
(f) In the event that the Securities Depository for a
series of Bonds discontinues providing its services, the Issuer
shall either engage the services of another Securities Depository
or deliver physical certificates in the manner described in
clause (e) above; provided, in addition, that any Bonds of such
series shall be in registered form within the meaning of
Section 149(a) of the Code.
(g) In connection with any notice or other communication to
be provided to the holders of a series of Bonds by the Issuer or
by the Trustee with respect to any consent or other action to be
taken by the holders, the Issuer or the Trustee, as the case may
be, shall establish a record date for such consent or other
action and give the Securities Depository Nominee notice of such
record date not less than fifteen (15) days in advance of such
record date to the extent possible.
(h) The Series 1998 Bonds shall be issued initially in the
form of two global certificates under the book entry system
maintained by The Depository Trust Company, New York, New York
("DTC"), as the initial Securities Depository, and shall be
registered in the name of Cede & Co., as the initial Securities
Depository Nominee for the Series 1998 Bonds. As long as the
Series 1998 Bonds are maintained by DTC under its book entry
system, all payments with respect to the principal of, redemption
premium, if any, and interest on Series 1998 Bonds and notices
shall be made and given, respectively, to DTC pursuant to a
letter of representations with DTC.
ARTICLE III
REDEMPTION OF BONDS BEFORE MATURITY
SECTION 3.01. Optional Redemption. The Series 1998 Bonds
are subject to optional redemption by the Issuer prior to
maturity on or after October 1, 2003, in whole or in part at any
time, at the written direction of the Company pursuant to
Section 4.9 of the Agreement, at the redemption prices (expressed
as percentages of principal amount) set forth in the table below,
plus accrued interest to the redemption date:
Optional
Redemption Period Redemption
(all dates inclusive) Price
October 1, 2003 through September 30, 2004 102%
October 1, 2004 through September 30, 2005 101
October 1, 2005 and thereafter 100
If less than all of the Bonds of a series shall be called
for redemption, the particular Bonds or portions of Bonds to be
redeemed shall be selected by the Trustee by lot or in such other
random manner as the Trustee in its discretion may determine.
SECTION 3.02. Special Optional Redemptions. The Series
1998 Bonds will be subject to optional redemption by the Issuer,
at the written direction of the Company pursuant to Section 4.9
of the Agreement, in whole but not in part, at any time, at a
redemption price equal to the principal amount thereof plus
accrued interest to the redemption date but without redemption
premium if:
(a) the Company shall have determined that the continued
operation of the Plant is impracticable, uneconomical or
undesirable for any reason;
(b) the Company shall have determined that the continued
operation of the Project is impracticable, uneconomical or
undesirable due to (1) the imposition of taxes, other than ad
valorem taxes currently levied upon privately owned property used
for the same general purpose as the Project, or other liabilities
or burdens with respect to the Project or the operation thereof,
(2) changes in technology, in environmental standards or legal
requirements or in the economic availability of materials,
supplies, equipment or labor or (3) destruction of or damage to
all or part of the Project;
(c) all or substantially all of the Project or the Plant
shall have been condemned or taken by eminent domain; or
(d) the operation of the Project or the Plant shall have
been enjoined or shall have otherwise been prohibited by an
order, decree, rule or regulation of any court or of any federal,
state or local regulatory body, administrative agency or other
governmental body.
The Series 1998 Bonds will also be subject to optional
redemption by the Issuer, at the written direction of the Company
pursuant to Section 4.9 of the Agreement, in whole but not in
part, at any time prior to October 1, 2003, at a redemption price
equal to 102% of the principal amount being redeemed plus accrued
interest to the redemption date, if the Company shall have
consolidated with or merged with or into another corporation, or
sold or otherwise transferred all or substantially all of its
assets.
In any such case, the Issuer, at the written direction of
the Company pursuant to Section 4.9 of the Agreement, shall give
written notice to the Trustee directing the Trustee to take all
action necessary to redeem the outstanding Series 1998 Bonds in
whole and on a date specified in such notice, which redemption
date shall be not less than forty-five (45) nor more than ninety
(90) days from the date the notice is received by the Trustee.
SECTION 3.03. Special Mandatory Redemption. The Series
1998 Bonds are also subject to mandatory redemption, at a
redemption price equal to the principal amount being redeemed
plus accrued interest to the redemption date, on the 180th day
(or such earlier date as may be designated by the Company) after
a final determination by a court of competent jurisdiction or an
administrative agency to the effect that as a result of a failure
by the Company to observe any covenant, agreement or
representation contained in the Agreement or the Issuer to
observe any covenant, agreement or representation in this
Indenture, the interest payable on the Series 1998 Bonds is not
excludable for federal income tax purposes from the gross income
of the owners thereof (other than any owner who is a "substantial
user" of the Project or a "related person" within the meaning of
Section 103(b)(13) of the 1954 Code. No determination by any
court or administrative agency will be considered final unless
the Company has received timely notice of and has had an
opportunity to participate in the proceeding which resulted in
such determination. The Series 1998 Bonds will be redeemed,
either in whole or in part, in such principal amount that the
interest payable on the Series 1998 Bonds remaining outstanding
after such redemption would not under Section 103 of the 1954
Code be included in the gross income of any owner thereof (other
than an owner who is a "substantial user" of the Project or a
"related person" within the meaning of Section 103(b)(13) of the
1954 Code).
SECTION 3.04. Notice of Redemption. (a) At least twenty-
five (25) days but not more than sixty (60) days before the
redemption date of any Bonds, either in whole or in part, the
Trustee shall cause a notice of any such redemption to be mailed,
first class mail, postage prepaid, to all owners of Bonds to be
redeemed in whole or in part at their addresses as they appear on
the registration books hereinabove provided for. Each such
notice shall set forth the date fixed for redemption, the
redemption price to be paid and, if less than all of the Bonds
then Outstanding shall be called for redemption, the distinctive
numbers and letters, if any, of such Bonds to be redeemed and, in
the case of Bonds to be redeemed in part only, the portion of the
principal amount thereof to be redeemed. In case any Bond is to
be redeemed in part only, the notice of redemption which relates
to such Bond shall state also that on or after the redemption
date, upon surrender of such Bond, a new Bond in principal amount
equal to the unredeemed portion of such Bond will be issued. In
the case of an optional redemption, the Company shall give the
Issuer and the Trustee reasonable notice of its exercise of such
right of optional redemption so as to allow the Trustee to give
the required notice to the owners of all Bonds to be redeemed.
(b) With respect to notice of redemption of any Bonds at
the option of the Issuer (at the written direction of the Company
pursuant to Section 4.9 of the Agreement), unless moneys
sufficient to pay the principal of, redemption premium, if any,
and interest on any such Bonds to be redeemed shall have been
received by the Trustee prior to the giving of such notice, such
notice may state that said redemption shall be conditioned upon
the receipt of such moneys by the Trustee on or prior to the date
fixed for such redemption. If such moneys shall not have been so
received, such notice shall be of no force and effect, the Issuer
shall not redeem such Bonds and the Trustee shall give notice to
the owners of all Bonds which were to have been redeemed, in the
manner in which the notice of redemption was given, that such
moneys were not so received.
SECTION 3.05. Effect of Call for Redemption. On the date
so designated for redemption, notice having been given in the
manner and under the conditions hereinabove provided, the Bonds
or portions of Bonds so called for redemption shall become and be
due and payable at the redemption price provided for redemption
for such Bonds or portions of Bonds on such date, and moneys for
payment of the redemption price and accrued interest to the
redemption date being held by the Trustee in a separate account
in the Bond Fund in trust for the holders of the Bonds or
portions thereof to be redeemed, all as provided in this
Indenture, interest on the Bonds or portions of Bonds so called
for redemption shall cease to accrue, such Bonds or portions of
Bonds shall cease to be entitled to any benefit or security under
this Indenture, and the holder of such Bonds or portions of Bonds
shall have no rights in respect thereof except to receive payment
of the redemption price thereof and accrued interest to the
redemption date.
SECTION 3.06. Partial Redemption. In case part but not all
of an outstanding Bond shall be selected for redemption, the
owner thereof or his attorney or legal representative shall
present and surrender such Bond to the Trustee for payment of the
principal amount thereof so called for redemption, and the Issuer
shall execute and the Trustee shall authenticate and deliver to
or upon the order of such owner or his attorney or legal
representative, without charge therefor, for the unredeemed
portion of the principal amount of the Bond so surrendered, a
Bond of the same series and maturity and bearing interest at the
same rate.
SECTION 3.07. Funds in Trust; Unclaimed Funds. All moneys
which the Trustee shall have withdrawn from the Bond Fund or
shall have received from any other source and set aside, or
deposited with the paying agents, for the purpose of paying any
of the Bonds hereby secured, either at the maturity thereof or
upon call for redemption, shall be held in trust for the
respective holders of such Bonds. But any moneys which shall be
so set aside or deposited by the Trustee and which shall remain
unclaimed by the holders of such Bonds for a period of five (5)
years after the date on which such Bonds shall have become due
and payable shall upon request in writing be paid to the Company
or to such officer, board or body as may then be entitled by law
to receive the same, and thereafter the holders of such Bonds
shall look only to the Company or to such officer, board or body,
as the case may be, for payment and then only to the extent of
the amount so received without any interest thereon, and the
Trustee, the Issuer and the paying agents shall have no
responsibility with respect to such moneys.
ARTICLE IV
GENERAL COVENANTS
SECTION 4.01. Payment of Principal and Redemption Premium,
If Any, and Interest. The Issuer covenants that it will promptly
pay the principal of and redemption premium, if any, and interest
on every Bond issued under this Indenture at the place, on the
dates and in the manner provided herein and in said Bonds
according to the true intent and meaning thereof, but only from
the payments made or to be made under the Agreement and pursuant
to any Note by the Company specifically pledged herein for such
purposes.
SECTION 4.02. Performance of Covenants; Issuer. The Issuer
covenants that it will faithfully perform at all times any and
all covenants, undertakings, stipulations and provisions
contained in this Indenture, in any and every Bond executed,
authenticated and delivered hereunder and in all of its
proceedings pertaining hereto. The Issuer represents that it is
duly authorized under the Constitution and laws of the State of
Mississippi, including particularly and without limitation the
Act, to issue the Bonds authorized hereby and to execute this
Indenture, to accept, assign and pledge the Notes and the
Agreement and the amounts payable under the Notes and to pledge
the amounts hereby pledged in the manner and to the extent herein
set forth; that all action on its part necessary for the issuance
of the Series 1998 Bonds and the execution and delivery of this
Indenture and the Agreement has been duly and effectively taken
and that all action on its part necessary for the issuance of any
Additional Bonds will be duly and effectively taken; that the
Series 1998 Bonds in the hands of the owners thereof are and will
be valid and enforceable obligations of the Issuer according to
the terms thereof and hereof; and that any Additional Bonds in
the hands of the owners thereof will be valid and enforceable
obligations of the Issuer according to the terms thereof and
hereof.
SECTION 4.03. Instruments of Further Assurance. The Issuer
covenants that, at the direction and expense of the Company, it
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 may reasonably require for the better
pledging and assigning unto the Trustee all and singular the
rights to payments under the Notes, the Agreement and any other
income and other moneys pledged hereby to the payment of the
principal of and redemption premium, if any, and interest on the
Bonds. The Issuer further covenants that it will not create or
suffer to be created any lien, encumbrance or charge upon its
interest in the Project or any part thereof, the Notes or the
Agreement except the lien of this Indenture.
SECTION 4.04. Recordation. The Issuer covenants that, at
the direction and expense of the Company, it will cause all
instruments as may be necessary to perfect and preserve the
security interest created by this Indenture to be recorded or
filed in such manner and in such places as may be required by
law. Copies of all such instruments shall be provided to the
Trustee. In the event the Issuer fails to record or file such
instruments as may be necessary to preserve the security interest
created by this Indenture, the Trustee, at the expense of the
Company, is authorized to cause such recordings and filings to be
made.
SECTION 4.05. Inspection of Project Books. The Issuer
covenants and agrees that all books and documents in its
possession relating to the Project shall at all times be open to
inspection by the Trustee and its duly authorized agents.
SECTION 4.06. Rights Under Agreement. The Agreement, a
duly executed counterpart of which has been filed with the
Trustee, sets forth the covenants and obligations of the Issuer
and the Company, and reference is hereby made to the same for a
detailed statement of said covenants and obligations of the
Company thereunder; and the Issuer agrees that the Trustee in its
own name or in the name of the Issuer may enforce all rights of
the Issuer and all obligations of the Company under and pursuant
to the Agreement for and on behalf of the Bondholders, whether or
not the Issuer is in default hereunder.
SECTION 4.07. Designation of Additional Paying Agents. The
Issuer shall cause, at the direction of the Company, the
necessary arrangements to be made through the Trustee and to be
thereafter continued for the designation of additional paying
agents and for providing for the payment of such of the Bonds as
shall be presented when due at the principal corporate trust
office of the Trustee, or its successor in trust hereunder, or at
the principal office of said additional paying agents. All such
funds held by said additional paying agents shall be held by each
of them in trust and shall constitute a part of the trust estate
and shall be subject to the security interest created hereby.
SECTION 4.08. Existence of Issuer. The Issuer covenants
that it will at all times maintain its corporate existence and
will duly procure any necessary renewals and extensions thereof;
will use its best efforts to maintain, preserve and renew all the
rights, powers, privileges and franchises owned by it; and will
comply with all valid acts, rules, regulations and orders of any
legislative, executive, judicial or administrative body
applicable to the Project and the matters herein provided for.
SECTION 4.09. Continuing Disclosure. It is understood,
acknowledged and agreed that the Issuer shall have no
responsibility for compliance with the continuing disclosure
requirements set forth in Rule 15c-2-12 promulgated by the
Securities and Exchange Commission under the Securities Exchange
Act of 1934 as in effect on the date of this Indenture, and shall
have no liability to the underwriters of the Bonds, the holders
of the Bonds or any other person with respect to such disclosure
matters.
ARTICLE V
REVENUES AND FUNDS
SECTION 5.01. Source of Payment of Bonds. The Bonds
authenticated and delivered hereunder are the obligations of the
Issuer and the Issuer shall make payments hereunder in respect of
the principal of and redemption premium, if any, and interest on
such Bonds. Such Bonds are not general obligations of the Issuer
or the State of Mississippi or any county, municipality or
political subdivision thereof, but are limited special
obligations payable solely from revenues and proceeds derived
from the Notes and the Agreement and as provided herein.
SECTION 5.02. Creation of Bond Fund. There is hereby
created and established with the Trustee a trust fund to be
designated "Mississippi Business Finance Corporation Pollution
Control Revenue Refunding Bonds (System Energy Resources, Inc.
Project) Series 1998 Bond Fund". Moneys deposited therein shall
be used to pay the principal of and redemption premium, if any,
and interest on the Bonds as provided in this Indenture.
SECTION 5.03. Payments into the Bond Fund. There shall be
deposited into the Bond Fund that portion of the proceeds from
the sale of the Series 1998 Bonds consisting of accrued interest
on the Series 1998 Bonds up to the date of their delivery. In
addition, there shall be deposited into the Bond Fund, as and
when received, (a) all repayments of the Loan and interest
thereon made pursuant to the Notes and the Agreement by the
Company; and (b) all other moneys received by the Trustee under
and pursuant to any of the provisions of the Agreement which are
required, or which are accompanied by directions from the Company
that such moneys are, to be paid into the Bond Fund. The Issuer
hereby covenants and agrees that, so long as any of the Bonds are
outstanding, it will deposit, or cause to be paid to the Trustee
for deposit in the Bond Fund for its account, sufficient sums
from revenues derived pursuant to the Notes and the Agreement
promptly to meet and pay the principal of and redemption premium,
if any, and interest on the Bonds as the same become due and
payable; provided, however, that nothing herein shall be
construed as requiring the Issuer to use any funds or revenues
from any source other than revenues derived pursuant to the Notes
and the Agreement. The Trustee is authorized to receive at any
time payments or prepayments from the Company pursuant to the
Notes and the Agreement for deposit in the Bond Fund.
SECTION 5.04. Use of Moneys in the Bond Fund. All interest
accruing on the Series 1998 Bonds up to the date of their
delivery will be paid from the amounts deposited in the Bond Fund
pursuant to the first sentence of Section 5.03 hereof. Except as
provided in this Indenture, moneys in the Bond Fund shall be used
solely for the payment of the principal of and redemption
premium, if any, and interest on the Bonds. Upon receipt of a
written notice from the Company pursuant to Section 4.9 of the
Agreement or in the case of a directed purchase of Bonds, upon
the deposit of cash or Government Obligations in the Bond Fund
sufficient, together with other amounts available therefor in the
Bond Fund, to make the directed purchase of Bonds, the Issuer and
the Trustee covenant and agree to take and cause to be taken the
necessary steps to redeem or purchase such principal amount of
Bonds as specified by the Company in such written notice;
provided, however, that any available moneys in the Bond Fund may
be used on direction of the Company to redeem a part of the Bonds
Outstanding and then redeemable or to purchase Bonds for
cancellation so long as the Company is not in default with
respect to any payments required pursuant to the Notes and the
Agreement and to the extent said moneys are in excess of the
amount required for payment of the Bonds theretofore matured or
called for redemption and interest accrued and payable in respect
of Outstanding Bonds.
SECTION 5.05. Custody of the Bond Fund. The Bond Fund
shall be in the custody of the Trustee but in the name of the
Issuer, and the Issuer hereby authorizes and directs the Trustee
to withdraw sufficient funds from the Bond Fund to pay the
principal of and redemption premium, if any, and interest on the
Bonds as the same become due and payable and to make said funds
so withdrawn available to the paying agents hereunder at their
principal office, for the purpose of paying said principal and
redemption premium, if any, and interest, which authorization and
direction the Trustee hereby accepts.
SECTION 5.06. 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 or purchase thereof, if funds sufficient to pay such
Bond shall have been deposited in the Bond Fund or otherwise made
available to the Trustee through deposit therein as provided in
Section 5.03, all liability of the Issuer to the holder thereof
for the payment of such Bond shall forthwith cease, terminate and
be completely discharged, and thereupon it shall be the duty of
the Trustee to hold such funds within a separate account in the
Bond Fund, subject to the provisions of Section 3.07 hereof,
without liability for interest thereon, for the benefit of the
holder of such Bond, which shall thereafter (subject to the
provisions of Section 3.07 hereof) be restricted exclusively to
such funds for any claim of whatever nature on his part under
this Indenture or on, or with respect to, said Bond.
SECTION 5.07. Moneys to Be Held in Trust. All moneys
required to be deposited with or paid to the Trustee for the
account of the Bond Fund under any provision of this Indenture
shall be held by the Trustee in trust, and except for moneys
deposited with or paid to the Trustee for the redemption of Bonds
or the payment of Bonds including Bonds which are deemed to be
paid within the meaning of Section 7.01 hereof, shall, while held
by the Trustee, constitute part of the trust estate and be
subject to the security interest created hereby.
SECTION 5.08. Repayment to the Company from the Bond Fund.
Any amounts remaining in the Bond Fund (other than moneys, if
any, set aside as provided in Sections 3.03, 3.05, 5.06 and 7.01
hereof), after payment in full of the Bonds (or provision for
payment thereof having been made in accordance with this
Indenture), the fees and expenses of the Issuer, the Trustee and
any additional paying agent and all other amounts required to be
paid hereunder and under the Rebate Agreement, shall be repaid to
the Company as provided in Section 6.5 of the Agreement.
SECTION 5.09. Transfers to Rebate Fund. Anything contained
in this Indenture to the contrary notwithstanding (a) the "Rebate
Fund" established under the Arbitrage Rebate Agreement by and
among the Issuer, the Trustee and the Company, dated as of
October 15, 1998, and related to the Series 1998 Bonds (the
"Rebate Agreement") shall not be considered part of the "trust
estate" created or pledged by this Indenture and (b) the Trustee
shall be permitted to transfer money on deposit in the Bond Fund
to the Rebate Fund established under the Rebate Agreement to
satisfy the provisions of the Rebate Agreement.
ARTICLE VI
INVESTMENTS, ETC.
SECTION 6.01. Investment of Bond Fund Moneys. Any moneys
held in the Bond Fund shall be invested and reinvested by the
Trustee, at the request of, and as orally directed by, the
Company, confirmed in writing, in Government Obligations or other
obligations or securities then permitted by law. Such
investments may be made through the investment department of the
Trustee. Any such 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 Bond Fund and the interest accruing thereon and any
profit realized from such investments shall be credited to the
Bond Fund and any loss resulting from such investments shall be
charged to the Bond Fund. The Trustee, upon oral direction of
the Company confirmed in writing, shall sell and reduce to cash a
sufficient amount of such investments whenever the cash balance
in the Bond Fund is insufficient to pay the principal of or
redemption premium, if any, or interest on the Bonds when due.
SECTION 6.02. Tax Covenants. The Issuer and the Company
will not directly or indirectly use or permit the use of any
proceeds of the Bonds or any other funds of the Issuer or the
Company, or take or omit to take any action that would cause the
Bonds to be "arbitrage bonds" within the meaning of Section 148
(a) of the Code or result in the loss of the exclusion from gross
income for federal income tax purposes of the interest paid on
the Bonds to the extent afforded under Section 103 of the 1954
Code. To that end, the Issuer and the Company will also comply
with all requirements of the Code and the 1954 Code to the extent
applicable to the Bonds. In the event that at any time the
Issuer or the Company is of the opinion that for purposes of this
Section 6.02 it is necessary to restrict or limit the yield on
the investment of any moneys held by the Trustee under this
Indenture, the Issuer or the Company shall so instruct the
Trustee in writing, and the Trustee shall take such action as may
be necessary in accordance with such instructions.
The Company, the Issuer and the Trustee covenant to comply
with the provisions of the Rebate Agreement as the Rebate
Agreement may be amended or supplemented in accordance with its
terms, and in compliance therewith, the Issuer hereby agrees to
establish with the Trustee a Rebate Fund under the Rebate
Agreement, which shall not be a trust fund under this Indenture,
and the terms of and provisions governing which shall be set
forth in the Rebate Agreement; provided that said compliance
shall not be required if the Issuer or the Company delivers to
the Trustee an opinion of nationally recognized bond counsel to
the effect that compliance is not required to preserve the
exclusion from gross income for federal income tax purposes of
interest paid on the Bonds. In the event of any conflict between
the provisions of the Rebate Agreement and the provisions of this
Indenture, the provisions of the Rebate Agreement shall govern.
This covenant shall survive payment in full or defeasance of the
Bonds.
The obligations imposed upon the Company by this Section
have been acknowledged and accepted by the Company in
Section 4.10 of the Agreement.
ARTICLE VII
RELEASE OF LIEN
SECTION 7.01. Release of Lien. If, when any of the Bonds
shall have become due and payable in accordance with their terms
as provided in this Indenture or shall have been duly called for
redemption or irrevocable instructions to call such Bonds for
redemption shall have been given by the Issuer to the Trustee,
the whole amount of the principal and the interest and the
redemption premium, if any, so due and payable upon such Bonds
shall be paid or sufficient cash or Government Obligations non-
callable by the issuer thereof, the principal of and the interest
on which when due will provide, without investment or
reinvestment, sufficient cash, shall be held by the Trustee or
the paying agents for such purpose under the provisions of this
Indenture, then and in that case such Bonds shall cease to be
secured by the lien of this Indenture, and the Trustee in such
case, on demand of the Issuer or the Company, shall release the
lien of this Indenture with respect to such Bonds and shall
execute such documents to evidence such release as may be
reasonably required by the Issuer or the Company; provided,
however, that in the event Government Obligations shall be
deposited with and held by the Trustee or the paying agents as
hereinabove provided, then in addition to the requirements set
forth in Article III of this Indenture, the Trustee shall within
thirty (30) days after such Government Obligations shall have
been deposited with it cause a notice signed by it to be
published once in a daily newspaper or financial journal having a
general circulation in the financial community in the Borough of
Manhattan, City and State of New York, setting forth (a) the date
designated for the redemption of such Bonds, (b) a description of
the Government Obligations so held by it and (c) that the lien of
this Indenture with respect to such Bonds has been released in
accordance with the provisions of this Section.
All moneys and obligations held by the Trustee or the paying
agents pursuant to this Section shall be held in trust and
applied to the payment, when due, of the principal of, redemption
premium, if any, and interest on such Bonds.
Notwithstanding the satisfaction and discharge of this
Indenture, the rights of the Trustee under Sections 9.02, 9.05
and 9.06 hereof, the obligations of the Trustee under sections
5.04, 5.06 and 5.07 hereof and the obligations of the Company
under Section 6.02 hereof, shall survive, anything in this
Indenture to the contrary notwithstanding.
ARTICLE VIII
DEFAULT PROVISIONS AND REMEDIES OF TRUSTEE
AND BONDHOLDERS
SECTION 8.01. Events of Default. If any of the following
events occur, it is hereby defined and declared to be and to
constitute an "event of default":
(a) failure to pay an installment of interest on any Bond
after such interest has become due for a period of sixty (60)
days; or
(b) failure to pay when due the principal of, or redemption
premium, if any, on any Bond, whether at the stated maturity
thereof, or upon proceedings for redemption thereof, or upon the
maturity thereof by acceleration; or
(c) default in the performance or observance of any other
of the covenants, agreements or conditions on the part of the
Issuer in this Indenture or in the Bonds, and continuance thereof
for the period after notice specified in Section 8.13 hereof; or
(d) the occurrence of an "event of default" under
Section 5.1 of the Agreement.
SECTION 8.02. Acceleration. Upon the occurrence of an event
of default the Trustee may, and upon the written request of the
holders of not less than 25% in aggregate principal amount of
Bonds then Outstanding shall, by notice in writing delivered to
the Issuer and the Company, declare the principal of all Bonds
then Outstanding and the interest accrued thereon immediately due
and payable; and such principal and interest shall thereupon
become and be immediately due and payable.
If, after the principal of the Bonds has been so declared to
be due and payable, all arrears of interest and interest on
overdue installments of interest (if lawful) at the rate per
annum borne by the Bonds and the principal and redemption
premium, if any, on all Bonds then Outstanding which shall have
become due and payable otherwise than by acceleration and all
other sums payable under this Indenture or upon the Bonds, except
the principal of, and interest on, the Bonds which by such
declaration shall have become due and payable, are paid by the
Issuer, and the Issuer also performs all other things in respect
of which it may have been in default hereunder and pays the
reasonable charges of the Issuer, the Trustee, the Bondholders
and any trustee appointed under law, including the Trustee's
reasonable attorneys' fees, then, and in every such case, the
Trustee shall annul such declaration and its consequences, and
such annulment shall be binding upon all holders of Bonds issued
hereunder; but no such annulment shall extend to or affect any
subsequent default or impair any right or remedy consequent
thereon. The Trustee shall forward a copy of any such annulment
notice pursuant to this paragraph to the Issuer and the Company.
SECTION 8.03. Other Remedies. If any event of default
occurs and is continuing, except as otherwise provided in Section
8.12 hereof, the Trustee, before or after declaring the principal
of the Bonds immediately due and payable, may enforce each and
every right granted to it under the Notes and the Agreement and
any supplements or amendments thereto for the benefit of the
Bondholders. In exercising such rights and the rights given the
Trustee under this Article VIII, the Trustee shall take such
action as, in the judgment of the Trustee applying the standards
described in Section 9.01(a) hereof, would best serve the
interests of the Bondholders.
SECTION 8.04. Legal Proceedings by Trustee. If any event
of default has occurred and is continuing, the Trustee in its
discretion may, and upon the written request of the holders of
not less than 25% in aggregate principal amount of all Bonds then
Outstanding and receipt of indemnity to its satisfaction shall,
in its own name:
(a by mandamus, or other suit, action or proceeding at law
or in equity, enforce all rights of the Bondholders;
(b bring suit upon the Bonds; or
(c by action or suit in equity enjoin any acts or things
which may be unlawful or in violation of the rights of the
Bondholders.
No remedy conferred upon or reserved to the Trustee or to
the Bondholders by the terms of this Indenture 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 Bondholders hereunder or now or
hereafter existing at law or in equity or by statute.
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 as often as may be
deemed expedient.
No waiver of any default or event of default hereunder,
whether by the Trustee or by the Bondholders, shall extend to or
shall affect any subsequent default or event of default or shall
impair any rights or remedies consequent thereon.
SECTION 8.05. Right of Bondholders to Direct Proceedings.
Anything in this Indenture to the contrary notwithstanding, the
holders of a majority in aggregate principal amount of Bonds then
Outstanding shall have the right, upon providing the Trustee
indemnity to its satisfaction, 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 proceedings to be
taken in connection with the enforcement of the terms and
conditions of this Indenture, or for the appointment of a
receiver or any other proceedings hereunder; provided, that such
direction shall not be otherwise than in accordance with the
provisions of law or of this Indenture.
SECTION 8.06. Appointment of Receivers. Upon the
occurrence of an event of default, and upon the filing of a suit
or other commencement of judicial proceedings to enforce the
rights of the Trustee and of the Bondholders under this
Indenture, the Trustee shall, to the extent permitted by law, be
entitled as a matter of right to the appointment of a receiver or
receivers of the trust estate with such powers as the court
making such appointment shall confer.
SECTION 8.07. Waiver. Upon the occurrence of an event of
default, to the extent that such rights may then lawfully be
waived, neither the Issuer, nor the State of Mississippi, nor any
political subdivision thereof, nor anyone claiming through or
under any of them, shall set up, claim, or seek to take advantage
of any appraisement, valuation, stay, extension or redemption
laws now or hereafter in force, in order to prevent or hinder the
enforcement of this Indenture, and the Issuer, for itself and all
who may claim through or under it, hereby waives, to the extent
that it lawfully may do so, the benefit of all such laws.
SECTION 8.08. Application of Moneys. All moneys received by
the Trustee pursuant to any right given or action taken under the
provisions of this Article VIII shall, after payment of the costs
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, be deposited in the Bond Fund
and all moneys (except moneys held in separate accounts by the
Trustee pursuant to Sections 3.05, 3.07 and 5.06 hereof) in the
Bond Fund shall be applied as follows:
(a Unless the principal of all the Bonds shall have become
or shall have been declared due and payable, all such moneys
shall be applied:
FIRST: To the payment of all amounts owed the United
States of America under the Rebate Agreement;
SECOND: To the payment to the persons entitled thereto of
all installments of interest then due on the
Bonds, in the order of the maturity of the
installments of such interest and, if the amount
available shall not be sufficient to pay in full
any particular installment, then to the payment
ratably, according to the amounts due on such
installment, to the persons entitled thereto,
without any discrimination or privilege; and
THIRD: To the payment to the persons entitled thereto of
the unpaid principal of and redemption premium, if
any, on any of the Bonds which shall have become
due (other than Bonds matured or called for
redemption for the payment of which moneys are
held pursuant to the provisions of this
Indenture), in the order of their due dates, with
interest on such Bonds from the respective dates
upon which they became due and, if the amount
available shall not be sufficient to pay in full
Bonds due on any particular date, together with
such interest, then to the payment ratably,
according to the amount of principal due on such
date, to the persons entitled thereto without any
discrimination or privilege.
(b If the principal of all the Bonds shall have become due
or shall have been declared due and payable, all such moneys
shall be applied to the payment of all amounts owed the United
States of America under the Rebate Agreement and then to the
payment of the principal and interest then due upon the Bonds,
without preference or priority of principal over interest or of
interest over principal, or of any installment of interest over
any other installment of interest, or of any Bond over any other
Bond, ratably, according to the amounts due respectively for
principal and interest, to the persons entitled thereto without
any discrimination or privilege.
(c If the principal of all the Bonds shall have been
declared due and payable, and if such declaration shall
thereafter have been rescinded and annulled under the provisions
of this Article VIII then, subject to the provisions of
subsection (b) of this Section 8.08 in the event that the
principal of all the Bonds shall later become due or be declared
due and payable, the moneys shall be applied in accordance with
the provisions of subsection (a) of this Section 8.08.
Whenever moneys are to be applied pursuant to the provisions
of this Section 8.08, such moneys shall be applied at such times,
and from time to time, as the Trustee shall determine, having due
regard to the amount of such moneys available for application and
the likelihood of additional moneys becoming available for such
application in the future. Whenever the Trustee shall apply such
funds, it shall fix the date (which shall be an interest payment
date unless it shall deem another date more suitable) upon which
such application is to be made and upon such date interest on the
amounts of principal 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, and shall not be required to make
payment to the holder of any Bond until such Bond shall be
presented to the Trustee for appropriate endorsement or for
cancellation if fully paid.
Whenever all principal of and redemption premium, if any,
and interest on all Bonds have been paid under the provisions of
this Section 8.08 and all expenses and charges of the Issuer, the
Trustee and any paying agents have been paid and all amounts owed
the United States of America under the Rebate Agreement have been
paid, any balance remaining in the Bond Fund shall be paid to the
Company as provided in Section 5.08 hereof.
SECTION 8.09. Remedies Vested in Trustee. All rights of
action (including the right to file proof of claims) under this
Indenture or under any of the Bonds may be enforced by the
Trustee without the possession of any of the Bonds or the
production thereof in any trial or proceedings relating thereto;
and any such suit or proceeding instituted by the Trustee shall
be brought in its name as Trustee without the necessity of
joining as plaintiffs or defendants any holders of the Bonds; and
any recovery of judgment shall be for the equal and ratable
benefit of the holders of the Bonds then Outstanding.
SECTION 8.10. Rights and Remedies of Bondholders. No
holder of any Bond shall have any right to institute any suit,
action or proceeding in equity or at law for the enforcement of
this Indenture or for the execution of any trust hereof or for
the appointment of a receiver or any other remedy hereunder,
unless (a) a default has occurred of which the Trustee has been
notified as provided in Section 9.01(h) hereof, or of which by
said subsection it is deemed to have notice, (b) such default
shall have become an event of default and the holders of not less
than 25% in aggregate principal amount of Bonds then Outstanding
shall have made written request to the Trustee and shall have
offered it reasonable opportunity either to proceed to exercise
the powers hereinbefore granted or to institute such action, suit
or proceeding in its own name, (c) such holders have offered to
the Trustee indemnity as provided in Section 9.01(l) hereof, and
(d) the Trustee shall thereafter fail or refuse to exercise the
powers hereinbefore granted, or to institute such action, suit or
proceeding in its own name; and such notification, request and
offer of indemnity are hereby declared in every case at the
option of the Trustee to be conditions precedent to the execution
of the powers and trusts of this Indenture, and to any action or
cause of action for the enforcement of this Indenture, or for the
appointment of a receiver or for any other remedy hereunder; it
being understood and intended that no one or more holders of the
Bonds shall have any right in any manner whatsoever to affect,
disturb or prejudice the lien of this Indenture by its, his or
their action or to enforce any right hereunder except in the
manner herein provided, and that all proceedings at law or in
equity shall be instituted, had and maintained in the manner
herein provided and for the equal and ratable benefit of the
holders of all Bonds then Outstanding. Nothing in this Indenture
contained shall, however, affect or impair the right of any
Bondholder to enforce the payment of the principal of and
redemption premium, if any, and interest on any Bond at and after
the maturity thereof, or the obligation of the Issuer to pay the
principal of and redemption premium, if any, and interest on each
of the Bonds issued hereunder to the respective holders thereof
at the time and place, from the source and in the manner in the
Bonds expressed.
SECTION 8.11. Termination of Proceedings. 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 continued or abandoned for any
reason, or shall have been determined adversely, then and in
every such case the Issuer and the Trustee shall be restored to
their former positions and rights hereunder, and all rights,
remedies and powers of the Trustee shall continue as if no such
proceedings had been taken.
SECTION 8.12. Waivers of Events of Default. The Trustee may
in its discretion waive any event of default hereunder and its
consequences and rescind any declaration of maturity of
principal, and shall do so upon the written request of the
holders of (a) not less than two-thirds in aggregate principal
amount of Bonds then Outstanding in respect of which default in
the payment of principal and/or interest exists, or (b) more than
50% in aggregate principal amount of all Bonds then Outstanding
in the case of any other default; provided, however, that there
shall not be waived (1) any event of default in the payment of
the principal of any outstanding Bonds when due or (2) any
default in the payment when due of the interest on any such Bonds
unless prior to such waiver or rescission, all arrears of
interest, with interest (to the extent permitted by law) at the
rate borne by the Bonds in respect of which such default shall
have occurred on overdue installments of interest or all arrears
of payments of principal when due, as the case may be, and all
expenses of the Trustee in connection with such default shall
have been paid or provided for, and in case of any such waiver or
rescission, or in the case any proceeding taken by the Trustee on
account of any such default shall have been discontinued or
abandoned or determined adversely, then and in every such case
the Issuer, the Trustee and the Bondholders shall be restored to
their former positions and rights hereunder respectively, but no
such waiver or rescission shall extend to any subsequent or other
default, or impair any right consequent thereon.
SECTION 8.13. Notice of Default under Section 8.01(c);
opportunity of Issuer and the Company to Cure Such Default.
Anything herein to the contrary notwithstanding, no default under
Section 8.01(c) hereof shall constitute an event of default until
actual notice of such default by registered or certified mail
shall be given to the Issuer and the Company by the Trustee or by
the holder or holders of not less than 25% in aggregate principal
amount of all Bonds Outstanding (with a copy to the Trustee) and
the Issuer and the Company shall have had sixty days after
receipt of such notice to correct said default or cause said
default to be corrected within the applicable period; provided,
however, if said default is such that it cannot be corrected
within the applicable period, it shall not constitute an event of
default if corrective action is instituted by the Issuer or the
Company within the applicable period and diligently pursued until
the default is corrected.
With regard to any alleged default concerning which notice
is given to the Issuer and the Company under the provisions of
this Section 8.13, the Issuer hereby grants the Company full
authority for the account of the Issuer to perform any covenant
or obligation alleged in said notice to constitute a default, in
the name and stead of the Issuer with full power to do any and
all things and acts to the same extent that the Issuer could do
and perform any such things and acts and with power of
substitution.
In the event that the Trustee fails to receive any amount
when due under the Notes and the Agreement, the Trustee shall
immediately give written notice to the Company specifying such
failure.
ARTICLE IX
THE TRUSTEE
SECTION 9.01. Acceptance of the Trusts. The Trustee hereby
accepts the trusts imposed upon it by this Indenture, and agrees
to perform said trusts, but only upon and subject to the
following express terms and conditions:
(a The Trustee, prior to the occurrence of any event of
default and after the curing or waiver of all events of default
which may have occurred, undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture.
In case an event of default has occurred (which has not been
cured or waived) the Trustee shall 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
corporate trustee would exercise or use under the circumstances
in the enforcement of a corporate indenture.
(b The Trustee may execute any of the trusts or powers
hereof and perform any of its duties by or through attorneys,
agents, receivers or employees but shall be answerable for the
conduct of the same in accordance with the standard specified
above, and shall be entitled to advice of counsel concerning all
matters relating to the trusts hereof and the duties hereunder,
and may in all cases pay such reasonable compensation to all such
attorneys, agents, receivers and employees as may reasonably be
employed in connection with the trusts hereof. The Trustee may
act upon the opinion or advice of any attorney (who may be the
attorney or attorneys for the Issuer or the Company), 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 inaction in good faith in reliance upon such
opinion or advice.
(c The Trustee shall not be responsible for any recital
herein, or in the Bonds (except in respect to the certificate of
the Trustee endorsed on the Bonds), or for the recording or re-
recording, filing or re-filing of this Indenture, or any other
instrument required by this Indenture to secure the Bonds, or for
insuring the Project or collecting any insurance moneys, or for
the validity of the execution by the Issuer 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.
(d The Trustee shall not be accountable for the use of any
Bonds authenticated or delivered hereunder. The Trustee may
become the owner of Bonds secured hereby with the same rights
which it would have if not the Trustee. To the extent permitted
by law, the Trustee may also receive tenders and purchase in good
faith Bonds from itself, including any department, affiliate or
subsidiary, with like effect as if it were not the Trustee.
(e The Trustee shall be protected in acting upon any
notice, request, consent, certificate, order, affidavit, letter,
telegram or other paper or document believed by it 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 owner of any Bond, shall be conclusive and
binding upon all future owners of the same Bond and upon owners
of Bonds issued in exchange therefor or in place thereof.
(f As to the existence or non-existence of any fact or as
to the sufficiency or validity of any instrument, paper or
proceeding, the Trustee shall be entitled to rely upon a
certificate signed by the Issuer or the Company as sufficient
evidence of the facts therein contained and prior to the
occurrence of an event of default of which the Trustee has been
notified as provided in subsection (h) of this Section 9.01, or
of which by said subsection it is deemed to have notice, the
Trustee shall also be at liberty to accept a similar certificate
to the effect that any particular dealing, transaction or action
is necessary or expedient, but may at its discretion secure such
further evidence deemed necessary or advisable, but shall in no
case be bound to secure the same. The Trustee may accept a
certificate of the Secretary of the Issuer under the Issuer's
seal to the effect that a resolution in the form therein set
forth has been adopted by the Issuer as conclusive evidence that
such resolution has been duly adopted, and is in full force and
effect.
(g The permissive right of the Trustee to do things
enumerated in this Indenture shall not be construed as a duty,
and it shall not be answerable for other than its negligence or
willful default.
(h The Trustee shall not be required to take notice or be
deemed to have notice of any event of default hereunder except
failure by the Issuer to cause to be made any of the payments to
the Trustee required to be made by Article IV hereof or the
existence of an event of default described in Section 8.01(c)
hereof, unless the Trustee shall be specifically notified in
writing of such event of default by the Issuer or by the holders
of at least 25% in aggregate principal amount of Bonds then
Outstanding; and all notices or other instruments required by
this Indenture to be delivered to the Trustee must, in order to
be effective, be delivered at the principal corporate trust
office of the Trustee, and in the absence of such notice so
delivered the Trustee may conclusively assume there is no event
of default except as aforesaid.
(i At any and all reasonable times the Trustee and its
duly authorized agents, attorneys, experts, engineers,
accountants and representatives shall have the right fully to
inspect any and all parts of the Project, including all books,
papers and records of the Issuer pertaining to the Project and
the Bonds and to take such memoranda from and in regard thereto
as may be desired.
(j The Trustee shall not be required to give any bond or
surety in respect of the execution of the said trusts and powers
or otherwise in respect of the premises.
(k Notwithstanding anything elsewhere in this Indenture
contained, the Trustee shall have the right, but shall not be
required, to demand, in respect of the authentication of any
Bonds, the withdrawal of any cash, or any action whatsoever
within the purview of this Indenture, any showings, certificates,
opinions, appraisals or other information, or corporate action or
evidence thereof, in addition to that by the terms hereof
required as a condition of such action by the Trustee, which the
Trustee in its discretion may deem desirable for the purpose of
establishing the right of the Issuer to the authentication of any
Bonds, the withdrawal of any cash, or the taking of any other
action by the Trustee.
(l Before taking any action referred to in Sections 8.02,
8.03, 8.04, 8.10, 8.12 or 9.04 hereof, the Trustee may require
that a satisfactory indemnity bond be furnished 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 negligence or willful
default by reason of any action so taken.
(m All moneys received by the Trustee or any paying agent
shall, until used or applied or invested as herein provided, be
held in trust for the purposes for which they were received but
need not be segregated from other funds except to the extent
required herein or by law. Neither the Trustee nor any paying
agent shall be under any liability for interest on any moneys
received hereunder except such as may be mutually agreed upon.
(n No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers.
SECTION 9.02. Fees, Charges and Expenses of Trustee. The
Trustee shall be entitled to payment and reimbursement for
reasonable fees for its services rendered hereunder and all
advances, counsel fees and other expenses reasonably and
necessarily made or incurred by the Trustee in connection with
such services. Upon an event of default, but only upon an event
of default, the Trustee shall have a first lien, with right of
payment prior to payment on account of principal of and
redemption premium, if any, and interest on any Bond, upon the
trust estate for the foregoing fees, charges and expenses
incurred by it.
SECTION 9.03. Notice to Bondholders if an Event of Default
Occurs. If an event of default occurs of which the Trustee is by
Section 9.01(h) hereof required to take notice or if notice of an
event of default is given as in Section 9.01(h) provided, then
the Trustee shall promptly give written notice thereof by
registered or certified mail to each owner of Bonds then
Outstanding.
SECTION 9.04. Intervention by Trustee. In any judicial
proceeding to which the Issuer is a party and which in the
opinion of the Trustee and its counsel has a substantial bearing
on the interests of the owners of the Bonds, the Trustee may
intervene on behalf of the Bondholders and shall do so if
requested in writing by the owners of at least 25% of the
aggregate principal amount of Bonds then Outstanding. The rights
and obligations of the Trustee under this Section 9.04 are
subject to the approval of a court of competent jurisdiction.
SECTION 9.05. Successor Trustee. Any corporation or
association into which the Trustee may be converted or merged, or
with which it may be consolidated, or to which it may sell or
transfer its trust business and assets as a whole or
substantially as a whole or any corporation or association
resulting from any such conversion, sale, merger, consolidation
or transfer to which it is a party, ipso facto, shall be and
become successor Trustee hereunder and vested with all of the
title to the trust estate and all the trusts, powers,
discretions, immunities, privileges and all other matters as was
its predecessor, without the execution or filing of any
instrument or any further act, deed or conveyance on the part of
any of the parties hereto, anything herein to the contrary
notwithstanding.
SECTION 9.06. Resignation by Trustee. The Trustee and any
successor Trustee may at any time resign from the trusts hereby
created by giving thirty days' written notice to the Issuer and
the Company, served personally or sent by registered or certified
mail, and to each owner of Bonds then Outstanding, sent by
registered or certified mail, and such resignation shall take
effect at the end of such thirty days if a successor Trustee has
been appointed at such time pursuant to Section 9.08 hereof, or
upon the later appointment of a successor Trustee pursuant to
Section 9.08 hereof.
SECTION 9.07. Removal of Trustee. The Trustee may be
removed at any time, by an instrument or concurrent instruments
in writing delivered (a) to the Trustee and to the Issuer and the
Company, and signed by the owners of a majority in aggregate
principal amount of Bonds then Outstanding, or (b) to the Trustee
and the owners of all Bonds then Outstanding, and signed by the
Issuer and the Company.
SECTION 9.08. Appointment of Successor Trustee. In case the
Trustee hereunder shall resign or be removed, or be dissolved, or
shall be in course of dissolution or liquidation, or otherwise
become incapable of acting hereunder, or in case it shall be
taken under the control of any public officer or officers, or of
a receiver appointed by a court, a successor shall be appointed
by the Issuer at the direction of the Company. The Issuer shall
cause notice of such appointment to be given in the same manner
as the giving of notices of redemption as set forth in Section
3.04 hereof. If the Issuer fails to make such appointment
promptly, a successor may be appointed by the owners of a
majority in aggregate principal amount of Bonds then Outstanding.
Every such successor Trustee appointed pursuant to the provisions
of this Section 9.08 shall be a trust company or bank in good
standing having a reported capital, surplus and undivided profits
of not less than $50,000,000, if there be such an institution
willing, qualified and able to accept the trusts upon reasonable
and customary terms.
SECTION 9.09. Concerning Any Successor Trustee. Every
successor Trustee appointed hereunder shall execute, acknowledge
and deliver to its predecessor and also to the Issuer an
instrument in writing accepting such appointment hereunder, and
thereupon such successor, without any further act, deed or
conveyance, shall become fully vested with all of the estates,
properties, rights, powers, trusts, duties and obligations of its
predecessor; but such predecessor shall, nevertheless, on the
written request of the Issuer, or of its successor, execute and
deliver an instrument transferring to such successor Trustee all
the estates, properties, rights, powers and trusts of such
predecessor hereunder, and every predecessor Trustee shall
deliver all securities and moneys held by it as Trustee hereunder
to its successor. Should any instrument in writing from the
Issuer be required by any successor Trustee for more fully and
certainly vesting in such successor the estate, rights, powers
and duties hereby vested or intended to be vested in the
predecessor, any and all such instruments in writing shall, on
request, be executed, acknowledged and delivered by the Issuer.
The resignation of any Trustee and the instrument or instruments
removing any Trustee and appointing a successor hereunder,
together with all other instruments provided for in this Article
IX, shall be filed and/or recorded by the successor Trustee in
each recording office where this Indenture shall have been filed
and/or recorded and the successor Trustee shall bear the cost
thereof.
SECTION 9.10. Successor Trustee as Bond Registrar, Custodian
of Bond Fund and Paying Agent. In the event of a change of
Trustee, the Trustee which has resigned or been removed shall
cease to be Bond Registrar, custodian of the Bond Fund and a
paying agent for principal of and redemption premium, if any, and
interest on the Bonds, and the successor Trustee shall become
such Bond Registrar, custodian of the Bond Fund and a paying
agent.
SECTION 9.11. Trustee and Issuer Required to Accept
Directions and Actions of Company. Whenever, after a reasonable
request by the Company, the Issuer shall fail, refuse or neglect
to give any direction to the Trustee or to require the Trustee to
take any action which the Issuer is required to have the Trustee
take pursuant to the provisions of the Agreement or this
Indenture, the Company as agent of the Issuer may give any such
direction to the Trustee or require the Trustee to take any such
action, and the Trustee is hereby irrevocably empowered and
directed to accept such direction from the Company as sufficient
for all purposes of this Indenture. The Company shall have the
right as agent of the Issuer to cause the Trustee to comply with
any of the Trustee's obligations under this Indenture to the same
extent that the Issuer is empowered so to do.
Certain actions or failures to act by the Issuer under this
Indenture may create or result in an event of default under this
Indenture and the Company, as agent of the Issuer, may to the
extent permitted by law perform any and all acts or take such
action as may be necessary for and on behalf of the Issuer to
prevent or correct said event of default and the Trustee shall
take or accept such performance by the Company as performance by
the Issuer in such event.
The Issuer hereby makes, constitutes and appoints the
Company irrevocably as its agent to give all directions, do all
things and perform all acts provided, and to the extent so
provided, by this Section 9.11.
SECTION 9.12. No Transfer of Notes Held by the Trustee.
Except as required to effect an assignment to a successor
Trustee, the Trustee shall not sell, assign or transfer the
Agreement or the Notes and the Trustee is authorized to enter
into an agreement with the Company to such effect.
SECTION 9.13. Insurance. The Trustee shall have no duty or
responsibility to receive, retain or review any policies of
insurance in connection with the Project or the Plant.
ARTICLE X
INDENTURES SUPPLEMENTAL HERETO
SECTION 10.01. Supplemental Indentures Not Requiring
Consent of Bondholders. The Issuer and the Trustee may, without
the consent of, or notice to, any of the Bondholders, enter into
such indenture or indentures supplemental to this Indenture as
shall not be inconsistent with the terms and provisions hereof
for any one or more of the following purposes:
(a to set forth any or all of the matters in connection
with the issuance of Additional Bonds as provided in Section 2.10
hereof;
(b to cure any ambiguity, defect or omission in this
Indenture, or to otherwise amend this Indenture, in such manner
as shall not in the opinion of the Trustee impair the security
hereof or adversely affect the Bondholders;
(c to grant to or confer upon the Trustee for the benefit
of the Bondholders any additional rights, remedies, powers or
authorities that may lawfully be granted or conferred upon the
Bondholders or the Trustee;
(d to add additional covenants of the Issuer, or to
surrender any right or power herein conferred upon the Issuer;
(e to subject to this Indenture additional revenues,
properties or collateral;
(f to modify, amend or supplement this Indenture or any
indenture supplemental hereto in such manner as to permit the
qualification hereof and thereof under the Trust Indenture Act of
1939 or any similar federal statute hereafter 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 of
America, and, if they so determine, to add to this Indenture or
any indenture supplemental hereto such other terms, conditions
and provisions as may be permitted by said Trust Indenture Act of
1939 or similar federal statute;
(g to provide different authorized denominations for the
Bonds;
(h to provide for an uncertificated registration system
for the Bonds;
(i to evidence the succession of a new Trustee hereunder;
and
(j to make such changes as may be necessary to comply with
the provisions of the 1954 Code or the Code relating to the
exclusion of interest on the Bonds from gross income thereunder.
SECTION 10.02. Supplemental Indentures Requiring Consent of
Bondholders. Exclusive of supplemental indentures covered by
Section 10.01 hereof and subject to the terms and provisions
contained in this Section 10.02, and not otherwise, the holders
of not less than 50% in aggregate principal amount of the Bonds
then Outstanding shall have the right, from time to time,
anything contained in this Indenture to the contrary
notwithstanding, to consent to and approve the execution by the
Issuer and the Trustee of such other indenture or indentures
supplemental hereto as shall be deemed necessary and desirable by
the Trustee 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 indenture
supplemental hereto; provided, however, that nothing in this
Section 10.02 contained shall permit, or be construed as
permitting (a) a change in the maturity of the principal of or
the interest on any Bond issued hereunder, or (b) a reduction in
the principal amount of, or redemption premium on, any Bond or
Bonds or the rate or rates of interest thereon, or (c) a
privilege or priority of any outstanding Bond or Bonds over any
other outstanding Bond or Bonds, or (d) a reduction in the
aggregate principal amount of the Bonds required for consent to
such supplemental indenture, unless, in each case, holders of all
Bonds then Outstanding consent to such supplemental indenture.
If at any time the Issuer shall request the Trustee to enter
into any such supplemental indenture for any of the purposes of
this Section 10.02, the Trustee shall, upon being satisfactorily
indemnified with respect to expenses, cause notice of the
proposed execution of such supplemental indenture to be given in
the same manner as the giving of notices of redemption as set
forth in Section 3.04 hereof. Such notice shall briefly set
forth the nature of the proposed supplemental indenture and shall
state that copies thereof are on file at the principal corporate
trust office of the Trustee for inspection by all Bondholders.
If, within sixty days or such longer period as shall be
prescribed by the Issuer following the giving of such notice, the
holders of not less than 50% in aggregate principal amount of the
Bonds Outstanding at the time of the execution of any such
supplemental indenture shall have consented to and approved the
execution thereof as herein provided, no holder of any Bond shall
have any right to object to any of the terms and provisions
contained therein, or the operation thereof, or in any manner to
question the propriety of the execution thereof, or to enjoin or
restrain the Trustee or the Issuer from executing the same or
from taking any action pursuant to the provisions thereof. Upon
the execution of any such supplemental indenture as in this
Section 10.02 permitted and provided, this Indenture shall be and
be deemed to be modified and amended in accordance therewith and
without the necessity for notation on the Bonds then Outstanding.
Anything herein to the contrary notwithstanding, a
supplemental indenture under this Article X which affects the
rights of the Company shall not become effective unless and until
the Company shall have consented to the execution and delivery of
such supplemental indenture. In this regard, the Trustee shall
cause notice of the proposed execution and delivery of any such
supplemental indenture together with a copy of the proposed
supplemental indenture to be mailed by certified or registered
mail to the Company at least fifteen days prior to the giving of
notice of the proposed execution of such supplemental indenture
as provided in this Section 10.02. The Company shall be deemed to
have consented to the execution and delivery of any such
supplemental indenture if the Trustee does not receive a letter
of protest or objection thereto signed by or on behalf of the
Company on or before 4:30 P.M., Mississippi time, on the
fifteenth day after the Company's receipt of said notice and a
copy of the proposed supplemental indenture.
SECTION 10.03. Trustee Authorized to Join in Supplements;
Reliance on Counsel. The Trustee is authorized to join with the
Issuer in the execution and delivery of any supplemental
indenture permitted by this Article X and in so doing shall be
fully protected by an opinion of counsel, who may be counsel for
the Issuer or the Company, that such supplemental indenture is so
permitted and has been duly authorized by the Issuer and that all
things necessary to make it a valid and binding supplemental
indenture have been done.
ARTICLE XI
AMENDMENT OF AGREEMENT AND NOTE
SECTION 11.01. Amendments, Etc., to Agreement Not Requiring
Consent of Bondholders. The Issuer and the Trustee shall,
without the consent of or notice to the Bondholders, consent to
any amendment, change or modification of the Agreement and the
Notes which may be entered into pursuant to Section 2.10 hereof
or in connection with (a) implementation of a requirement of the
Agreement or this Indenture, (b) the curing of an ambiguity or
formal defect or omission, (c) the substitution or addition of
facilities to the Project or in connection with identifying the
Project more precisely, or (d) any other change which, in the
judgment of the Trustee, is not to the prejudice of the Trustee
or the Bondholders; provided, however, that as a condition of
such consent, there may be required an opinion of nationally
recognized counsel experienced on the subject of municipal bonds
to that effect and to the effect that such action does not
adversely effect the exclusion from gross income for federal
income tax purposes of the interest paid on the Bonds.
SECTION 11.02. Amendments, Etc., to Agreement Requiring
Consent of Bondholders. Except for the amendments, changes or
modifications as provided in Section 11.01 hereof, neither the
Issuer nor the Trustee shall consent to any other amendment,
change or modification of the Agreement or the terms of the Notes
without the giving of notice and the written approval or consent
of the holders of not less than 50% in aggregate principal amount
of the Bonds then Outstanding given and procured as in this
Section 11.02 provided. If at any time the Issuer and the
Company shall request the consent of the Trustee to any such
proposed amendment, change or modification of the Agreement or
the terms of the Notes, the Trustee shall, upon being
satisfactorily indemnified with respect to expenses, cause notice
of such proposed amendment, change or modification to be given in
the same manner as provided by Section 10.02 hereof with respect
to supplemental indentures. Such notice shall briefly set forth
the nature of such proposed amendment, change or modification and
shall state that copies of the instrument embodying the same are
on file with the Trustee for inspection by all Bondholders.
SECTION 11.03. Trustee Authorized to Join in Amendments;
Reliance on Counsel. The Trustee is authorized to join with the
Issuer in the execution and delivery of any amendment permitted
by this Article XI and in so doing shall be fully protected by an
opinion of counsel, who may be counsel for the Issuer or the
Company, that such amendment is so permitted and has been duly
authorized by the Issuer and that all things necessary to make it
a valid and binding agreement have been done.
ARTICLE XII
MISCELLANEOUS
SECTION 12.01. Consents, Etc., of Bondholders. Any consent,
request, direction, approval, objection or other instrument
required by this Indenture to be signed and executed by the
Bondholders may be in any number of concurrent writings of
similar tenor and may be signed or executed by such Bondholders
in person or by agent appointed in writing. Proof of the
execution of any such consent, request, direction, approval,
objection or other instrument or of the writing appointing any
such agent, if made in the following manner, shall be sufficient
for any of the purposes of this Indenture, and shall be
conclusive in favor of the Trustee with regard to any action
taken by it under such request or other instrument, namely:
The fact and date of the execution by any person of any such
writing may be proved by the certificate of any officer in any
jurisdiction who by law has power to take acknowledgments within
such jurisdiction that the person signing such writing
acknowledged before him the execution thereof, or by an affidavit
of any witness to such execution.
SECTION 12.02. Limitation of Rights. With the exception of
rights herein expressly conferred, nothing expressed or mentioned
in or to be inferred from this Indenture, or the Bonds, is
intended or shall be construed to give to any person or company
other than the Company, the parties hereto, and the holders of
the Bonds, any legal or equitable right, remedy or claim under or
in respect of this Indenture or any covenants, conditions and
provisions herein contained. This Indenture and all of the
covenants, conditions and provisions hereof are intended to be
and are for the sole and exclusive benefit of the Company, the
parties hereto and the holders of the Bonds as herein provided.
SECTION 12.03. Severability. If any provision of this
Indenture shall be held or deemed to be or shall, in fact, be
illegal, inoperative or unenforceable, the same shall not affect
any other provision or provisions herein contained or render the
same invalid, inoperative or unenforceable to any extent
whatever.
SECTION 12.04. Notices. Any notice, request, complaint,
demand, communication or other paper shall be sufficiently given
and shall be deemed given when delivered or mailed by registered
or certified mail, postage prepaid, or sent by telegram,
addressed as follows: if to the Issuer, at 1306 Walter Sillers
Building, 550 High Street, Jackson, Mississippi 39205, Attention:
Executive Director; if to the Trustee, at Tower Marc Plaza, 10161
Centurion Parkway, Jacksonville, Florida 32256, Attention:
Corporate Trust Division; and if to the Company, at 639 Loyola
Avenue, New Orleans, Louisiana 70113, Attention: Treasurer. A
duplicate copy of each notice required to be given hereunder by
either the Issuer or the Trustee shall also be given to the
Company, and a duplicate copy of each notice required to be given
hereunder by the Trustee to either the Issuer or the Company
shall also be given to the other. The Issuer, the Company and
the Trustee may, by notice given hereunder, designate any further
or different addresses to which subsequent notices, certificates
or other communications shall be sent.
SECTION 12.05. Trustee as Paying Agent and Bond Registrar.
The Trustee is hereby designated and agrees to act as a paying
agent and Bond Registrar for and in respect of the Bonds.
SECTION 12.06. Payments Due on Saturdays, Sundays and
Holidays. In any case where the date of maturity of interest on
or principal of the Bonds or the date fixed for redemption of any
Bonds shall be a Saturday, Sunday, or in the city of payment, a
legal holiday or a day on which banking institutions are
authorized by law to close, then payment of interest or principal
and redemption premium, if any, need not be made on such date but
may 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 no interest on such payment shall
accrue for the period after such date.
SECTION 12.07. 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.
SECTION 12.08. Applicable Provisions of Law. This
Indenture shall be governed by and construed in accordance with
the laws of the State of Mississippi.
SECTION 12.09. 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 12.10. No Liability of Officers. No covenant or
agreement contained in the Bonds or this Indenture shall be
deemed to be a covenant or agreement of any member, officer,
agent or employee of the Issuer in his individual capacity, and
neither the members of the Board nor any official executing the
Bonds or this Indenture shall be liable personally on the Bonds
or be subject to any personal liability or accountability by
reason of the issuance of the Bonds or the execution and delivery
of this Indenture.
IN WITNESS WHEREOF, the Mississippi Business Finance
Corporation has caused these presents to be signed in its name
and behalf by its Executive Director, and its official seal to be
hereunto affixed and attested by its Secretary, and to evidence
its acceptance of the trusts hereby created The Bank of New York
Trust Company of Florida, N.A., as Trustee, has caused these
presents to be signed in its name and behalf and its official
seal to be hereunto affixed and attested by its duly authorized
officers, all as of the day and year first above written.
MISSISSIPPI BUSINESS FINANCE
CORPORATION
By
Executive Director
ATTEST:
Secretary
<PAGE>
THE BANK OF NEW YORK TRUST
COMPANY OF FLORIDA, N.A.
[SEAL]
By
Title
ATTEST:
Title
<PAGE>
STATE OF LOUISIANA
PARISH OF ORLEANS
Personally appeared before me, the undersigned authority in
and for the said parish and state, on this 3rd day of November,
1998, within my jurisdiction, the within named William T. Barry
and James Vernon Smith, Sr., who acknowledged that they are the
Executive Director and Secretary of the Mississippi Business
Finance Corporation, and that in said representative capacities
they executed the above and foregoing instrument, after first
having been duly authorized so to do.
Notary Public
My Commission Expires:
<PAGE>
STATE OF
COUNTY OF
Personally appeared before me, the undersigned authority in
and for the said county and state, on this day of November,
1998, within my jurisdiction, the within named
and
, who acknowledged
that they are a and
, respectively, of The Bank
of New York Trust Company of Florida, N.A., a national banking
association, and that for and on behalf of the said bank and as
its act and deed they executed the above and foregoing
instrument, after first having been duly authorized by said bank
so to do.
Notary Public
My Commission Expires:
Exhibit B-6(b)
MISSISSIPPI BUSINESS FINANCE CORPORATION
and
SYSTEM ENERGY RESOURCES, INC.,
formerly Middle South Energy, Inc.
LOAN AGREEMENT
Dated as of October 15, 1998
Relating to $216,000,000 Pollution Control
Revenue Refunding Bonds
(System Energy Resources, Inc. Project)
Series 1998
<PAGE>
THIS LOAN AGREEMENT, dated as of October 15, 1998, by and
between the MISSISSIPPI BUSINESS FINANCE CORPORATION, a public
corporation duly created and validly existing pursuant to the
Constitution and laws of the State of Mississippi (the "Issuer"),
authorized to exercise the powers conferred by Sections 57-10-201
et seq.,Mississippi Code of 1972, as amended and supplemented
(the "Act"), and SYSTEM ENERGY RESOURCES, INC., formerly Middle
South Energy, Inc., a corporation organized and existing under
the laws of the State of Arkansas and qualified and doing
business as a foreign corporation in the State of Mississippi
(the "Company"), evidencing the agreement of the parties hereto.
In consideration of the respective representations and
agreements hereinafter contained, the parties hereto agree as
follows (provided that in the performance of the agreements of
the Issuer herein contained, any obligation it may thereby incur
for the payment of money shall not be a general debt, liability
or obligation of the Issuer, or of the State of Mississippi or
any political subdivision thereof but shall be payable solely out
of the revenue and proceeds derived from this Agreement and the
Notes (hereinafter defined) and the sale of the Bonds referred to
herein).
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. "Additional Bonds", "Bond Fund",
"Bondholder", "Bonds", "Code", "Government Obligations", "1954
Code", "Project", "Rebate Agreement" and "Trustee" have the same
meanings given and assigned to such words in Article I of the
Indenture (hereinafter defined).
Agreement
"Agreement" means this Loan Agreement and any amendments and
supplements hereto.
Event of Default
"Event of Default" means any of the occurrences enumerated
in Section 5.1 of this Agreement.
Indenture
"Indenture" means the Trust Indenture, dated as of
October 15, 1998, relating to the Bonds, between the Issuer and
the Trustee pursuant to which the Bonds are authorized to be
issued, and including any indenture supplemental thereto.
Loan
"Loan" means the loan to be made by the Issuer to the
Company of the proceeds (which shall be deemed to include the
underwriting discount, if any, and original issue discount, if
any) of the sale of the Bonds, exclusive of any accrued interest
paid by the initial purchasers of the Bonds upon the delivery
thereof.
Notes
"Notes" means the non-negotiable promissory notes of the
Company issued pursuant to Section 3.2 hereof, in the form set
forth in Exhibit A hereto.
Series A Bonds
"Series A Bonds" means the $49,500,000 Claiborne County,
Mississippi Adjustable/Fixed Rate Pollution Control Revenue Bonds
(Middle South Energy, Inc. Project) Series A, dated as of
December 1, 1983.
Series C Bonds
"Series C Bonds" means the $206,000,000 Claiborne County,
Mississippi Adjustable/Fixed Rate Pollution Control Revenue Bonds
(Middle South Energy, Inc. Project) Series C, dated as of
December 1, 1984.
Series 1998 Bonds
"Series 1998 Bonds" means the bonds authorized to be issued
under Section 2.02 of the Indenture.
ARTICLE II
ACQUISITION AND COMPLETION OF THE PROJECT;
ISSUANCE OF THE BONDS
SECTION 2.1. Acquisition and Completion of the Project. The
Company represents that the acquisition, installation and
construction of the Project have been completed.
SECTION 2.2. Issuance of Series 1998 Bonds; Additional
Bonds. In order to provide funds to currently refund a portion
of the Series A Bonds and all of the Series C Bonds, the Issuer
agrees that it will initially issue and deliver the Series 1998
Bonds to the purchasers thereof at a price to be approved in
advance by the Company and apply and deposit the proceeds thereof
in accordance with the terms of the Indenture. The Indenture
shall be satisfactory in form and substance to the Company and
shall provide the manner in which, and the purposes for which,
proceeds of Bonds may be used and invested.
If no Event of Default shall have occurred and be
continuing, the Issuer will authorize the sale of and use its
best efforts to sell from time to time, to the extent permitted
by law, Additional Bonds, in amounts specified by the Company and
upon the terms and conditions provided in the Indenture, for any
purpose permitted by the Indenture and the Act. The Issuer will
deposit the proceeds of any such Additional Bonds with the
Trustee in accordance with the terms of the Indenture.
ARTICLE III
LOAN BY ISSUER; PROVISIONS FOR PAYMENT
SECTION 3.1. Loan by Issuer. The Issuer hereby agrees to
make the Loan to the Company for the purpose, in the case of the
proceeds of the Series 1998 Bonds, of currently redeeming a
portion of the Series A Bonds and all of the Series C Bonds
within 90 days after the date of initial issuance of the Series
1998 Bonds. The Company hereby agrees to cause the proceeds of
the Series 1998 Bonds to be applied exclusively to the foregoing
purpose and to cause such Series A Bonds and Series C Bonds to be
redeemed within 90 days after the date of initial issuance of the
Series 1998 Bonds. In addition, the Company agrees to pay any
and all amounts required in addition to the proceeds of the
Series 1998 Bonds to currently redeem a portion of the Series A
Bonds and all of the Series C Bonds.
SECTION 3.2. Delivery of Notes by Company; Other Amounts
Payable. In order to evidence the Loan and the repayment
obligation of the Company, the Company shall execute and deliver
for each series of Bonds a Note in a principal amount equal to
the aggregate principal amount of, and having the same stated
rate or rates of interest as, such series of Bonds. Each Note
shall be dated the date of the initial issuance of, and mature on
the same maturity date or dates as, the series of Bonds issued
concurrently therewith.
Pursuant to the Notes, the Company agrees to pay or cause to
be paid to the Issuer, in immediately available funds, a sum
equal to the aggregate principal amount of each series of Bonds
issued under the Indenture, redemption premium, if any, and
interest on the unpaid balances thereof at the rates payable by
the Issuer on such Bonds at the times such principal, redemption
premium, if any, and interest is payable by the Issuer
irrespective of any original issue discount with respect to such
Bonds. If, at the date any payment on such Bonds is due, there
are any available moneys in the Bond Fund, such moneys shall be
credited against said payment, first in respect of interest and
then, to the extent of remaining moneys, in respect of principal.
The Company shall also pay (a) the fees, charges and
reasonable expenses of the Trustee and any paying agents under
the Indenture, such fees, charges and reasonable expenses to be
paid directly to the Trustee or paying agents for their
respective accounts as and when such fees, charges and reasonable
expenses become due and payable, (b) any expenses and costs
incurred or to be incurred by virtue of the issuance and sale of
the Bonds, (c) any expenses in connection with any redemption of
the Bonds, (d) any expenses in connection with the redemption of
the aforementioned Series A Bonds and the Series C Bonds and
(e) any amounts owed under the Rebate Agreement.
SECTION 3.3. Obligation of the Company Unconditional. The
obligation of the Company to make the payments as provided in
this Agreement and the Notes and to perform and observe the other
agreements on its part contained herein shall be absolute and
unconditional notwithstanding failure of the title to the Project
or any part thereof, loss of title to (or the temporary use
of) the Project by virtue of the exercise by others of the power
of eminent domain, any acts or circumstances that may constitute
failure of consideration, destruction of or damage to the
Project, commercial frustration of purpose, any change in the tax
or other laws of the United States of America or of the State of
Mississippi or any political subdivision of either thereof or any
failure of the Issuer to perform and observe any agreement,
whether express or implied, or any duty, liability or obligation
arising out of or connected with this Agreement. Nothing
contained in this Section 3.3 shall be construed to release the
Issuer from the performance of any of the agreements on its part
herein contained; and, in the event the Issuer should fail to
perform any such agreement on its part, the Company may institute
such action against the Issuer as the Company may deem necessary
to compel performance or recover its damages for nonperformance
so long as such action shall not violate the agreements on the
part of the Company contained in the preceding sentence, but in
no event shall the Company be entitled to reduce the amounts
payable under the Notes and Section 3.2 hereof. The Company may,
however, at its own cost and expense and in its own name or in
the name of the Issuer, prosecute or defend any action or
proceeding or take any other action involving third persons which
the Company deems reasonably necessary in order to secure or
protect its right of possession, occupancy and use hereunder, and
in such event the Issuer hereby agrees to cooperate fully with
the Company and to take all action necessary to effect the
substitution of the Company for the Issuer in any such action or
proceeding if the Company shall so request.
SECTION 3.4. Assignment and Pledge of Payments and Rights
Under the Notes and the Agreement. The Issuer shall assign and
pledge to the Trustee as security under the Indenture all rights,
title and interests of the Issuer in and to (a) the Notes and all
payments thereunder and (b) this Agreement and all moneys
receivable hereunder (except for payments under Sections 4.3 and
5.3 hereof). The Company assents to such assignment and hereby
agrees that, as to the Trustee, its obligations to make such
payments shall be absolute and shall not be subject to any
defense or any right of set-off, counterclaim or recoupment
arising out of any breach by the Issuer or the Trustee of any
obligation to the Company, whether hereunder or otherwise, or out
of any indebtedness or liability at any time owing to the Company
by the Issuer or the Trustee.
ARTICLE IV
SPECIAL COVENANTS
SECTION 4.1. No Warranty of Suitability by the Issuer. The
Issuer makes no warranty either express or implied as to the
Project, including its suitability for the Company's purposes or
needs.
SECTION 4.2. Use of Project. The Issuer does hereby
covenant and agree that it will not take any action, other than
pursuant to the exercise of its rights under Section 5.2 of this
Agreement, to prevent the Company from having possession and
enjoyment of the Project during the term of this Agreement and
will, at the request of the Company and at the Company's cost,
reasonably cooperate with the Company in order that the Company
may have possession and enjoyment of the Project. The Issuer
hereby acknowledges that it shall have no rights to the use or
possession of the Project. The Issuer hereby further
acknowledges that the Project will not constitute any part of the
security for the Bonds.
SECTION 4.3. Indemnity Against Claims. The Company shall
pay and discharge and shall indemnify and hold harmless the
Issuer and the Trustee from (a) any lien or charge upon payments
by the Company to the Issuer under the Notes or hereunder,
(b) any taxes, assessments, impositions and other charges upon
payments by the Company to the Issuer under the Notes or
hereunder and (c) any and all liability, damages, costs and
expenses arising out of or resulting from the transactions
contemplated by this Agreement and the Indenture or in any way
related to the Project, including the reasonable fees and
expenses of counsel. If any such lien or charge is sought to be
imposed upon payments, or any such taxes, assessments,
impositions or other charges are sought to be imposed, or any
such liability, damages, costs and expenses are sought to be
imposed, the Issuer and/or the Trustee shall give prompt written
notice to the Company, and the Company shall have the sole right
and duty to assume, and will assume, the defense thereof, with
full power to litigate, compromise or settle the same in its sole
discretion.
SECTION 4.4. Inspection of the Project. The Company agrees
that the Issuer and its duly authorized agents may at reasonable
times enter upon the Project site and examine and inspect
the Project and the books and records of the Company with respect
to the Project.
SECTION 4.5. The Company to Maintain Its Corporate
Existence; Conditions Under Which Exceptions Permitted. The
Company agrees that during the term of this Agreement it will
maintain its corporate existence in the State of Arkansas and
qualification to do business in the State of Mississippi, will
not dissolve or otherwise dispose of all or substantially all of
its assets and will not consolidate with or merge into another
corporation or permit one or more other corporations to
consolidate with or merge into it; provided, that the Company
may, without violating the agreements contained in this
Section 4.5, consolidate with or merge into another domestic
corporation (i.e., a corporation incorporated and existing under
the laws of one of the states of the United States of America or
under the laws of the United States of America) or permit one or
more other corporations to consolidate with or merge into it, or
sell or otherwise transfer to another domestic corporation all or
substantially all of its assets as an entirety and thereafter
dissolve, provided that (i) both immediately prior to such
consolidation or merger and after giving effect thereto, no Event
of Default (or event which, with the giving of notice or the
passage of time, or both, would become an Event of Default) shall
have occurred and be continuing, (ii) in the event the Company is
not the surviving, resulting or transferee corporation, as the
case may be, the surviving, resulting or transferee corporation
assumes, accepts and agrees in writing to pay and perform all of
the obligations of the Company herein and under the Notes and is
a Mississippi corporation or is qualified to do business in the
State of Mississippi as a foreign corporation and (iii) whether
or not the Company is the surviving, resulting or transferee
corporation, such consolidation or merger does not result in the
loss of the exclusion from gross income for federal income tax
purposes of interest on the outstanding Bonds.
SECTION 4.6. Annual Statement. The Company agrees to have
an annual audit made by its regular independent public
accountants and within 180 days after the close of each fiscal
year to furnish the Trustee and any Bondholder who may so request
a balance sheet and statement of income and surplus showing the
financial condition of the Company and its consolidated
subsidiaries, if any, at the close of such fiscal year and the
results of operations of the Company and its consolidated
subsidiaries, if any, for such fiscal year, accompanied by a
certificate or opinion of said accountants. The requirements of
the Company pursuant to this Section 4.6 may be satisfied by the
submission to the Trustee and each Bondholder who may request
such information of the Company's annual report to its
shareholders, so long as the Company prepares such an annual
report or its Annual Report on Form 10-K.
SECTION 4.7. Further Assurances and Corrective Instruments.
The Issuer and the Company agree that they will, from time to
time, execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered, such supplements hereto and such
further instruments as may reasonably be required for correcting
any inadequate or incorrect description of the Project and for
carrying out the intention or facilitating the performance of
this Agreement.
SECTION 4.8. Maintenance of Project by Company. The Company
agrees that during the term of this Agreement it will pay all
costs of operating, maintaining and repairing the Project;
provided, however, that the Company shall not be under any
obligation to renew, repair or replace any inadequate, obsolete,
worn-out, unsuitable, undesirable or unnecessary portion of the
Project. In any instance where the Company determines that any
portion of the Project has become inadequate, obsolete, worn-out,
unsuitable, undesirable or unnecessary, the Company may remove
such portion of the Project and sell, trade-in, exchange or
otherwise dispose of such removed portion without any
responsibility or accountability to the Issuer, the Trustee or
the Bondholders therefor.
SECTION 4.9. Redemption or Purchase of Bonds. The Issuer
shall take all steps then necessary under the applicable
provisions of the Indenture and then applicable federal and state
laws and regulations for the redemption or purchase of Bonds upon
receipt by the Issuer and the Trustee from the Company of a
written notice specifying:
(a) the principal amount of Bonds to be redeemed or
purchased and the section of the Indenture pursuant to which such
Bonds are being redeemed or purchased;
(b) the date of such redemption or purchase, which date, in
the case of a redemption of Bonds, shall be at least forty-five
(45) days but not more than ninety (90) days subsequent to the
receipt by the Trustee of such notice; and
(c) in the case of a redemption of Bonds, directions to
mail a notice of redemption pursuant to Section 3.04 of the
Indenture.
In the case of a purchase of Bonds, the written notice to
the Trustee shall, if available moneys in the Bond Fund are
insufficient to purchase the principal amount of Bonds specified
in (a) above, be accompanied by a deposit into the Bond Fund of
cash or Government Obligations sufficient, together with other
moneys then available in the Bond Fund, to make the directed
purchase of Bonds.
SECTION 4.10. Tax Covenants. The Company covenants and
agrees that it will not use or permit the use by any person of
any of the funds provided by the Issuer hereunder or any other of
its funds, directly or indirectly, or direct the Trustee to
invest any funds held by it under the Indenture or this
Agreement, in such manner as would, or enter into, or allow any
"related person" (as defined in Section 103(b)(13) of the 1954
Code) to enter into, any arrangement, formal or informal, that
would, or take or omit to take any other action that would, cause
any Bond to be an "arbitrage bond" within the meaning of Section
148(a) of the Code or result in the loss of the exclusion from
gross income for federal income tax purposes of the interest paid
on the Bonds to the extent afforded under Section 103 of the 1954
Code. The Company acknowledges Section 6.02 of the Indenture and
agrees to perform all duties imposed upon it by such Section
including but not limited to its obligations under the Rebate
Agreement. Insofar as said section imposes duties and
responsibilities on the Company, it is specifically incorporated
herein by reference. The Issuer and the Company mutually
covenant and agree that neither of them shall take or authorize
or permit any action to be taken, and have not taken or
authorized or permitted any action to be taken, which has or
would result in the interest on any Bonds theretofore issued
under the Indenture being included in gross income of the holders
thereof for federal income tax purposes. This covenant shall
survive the termination of this Agreement.
SECTION 4.11. Ad Valorem Taxes. The Project shall be
subject to assessment thereof for ad valorem taxes in the manner
provided by law and the Company agrees to timely pay all such
taxes.
SECTION 4.12. Continuing Disclosure. It is understood,
acknowledged and agreed that the Issuer shall have no
responsibility for compliance with the continuing disclosure
requirements set forth in Rule 15c-2-12 promulgated by the
Securities and Exchange Commission under the Securities Exchange
Act of 1934, as in effect on the date of this Agreement, and
shall have no liability to the underwriters of the Bonds, the
holders of the Bonds or any other person with respect to such
disclosure matters. To the extent applicable to the Company, the
Company agrees to comply fully with the continuing disclosure
requirements of said Rule 15c-2-12.
SECTION 4.13. Series A Bonds and Series C Bonds. The
Company represents that the interest rates on the Series A Bonds
and the Series C Bonds were converted to a fixed rate to maturity
commencing December 1, 1988.
SECTION 4.14. Assignment, Leasing and Selling. The
Company's interest in this Agreement may be assigned in whole or
in part, and the Project may be leased or sold as a whole or in
part (whether a specific element or unit or an undivided
interest), by the Company, without the consent of the Issuer or
the Trustee, subject, however, to the condition that no
assignment, lease or sale (other than as described in Section 4.8
hereof) shall relieve the Company from primary liability for its
obligations under Section 3.2 hereof to pay the payments required
thereunder, or for any other of its obligations hereunder, other
than those obligations relating to the operation, maintenance and
insurance of the Project, which obligations (to the extent of the
interest assigned, leased or sold and to the extent assumed by
the assignee, lessee or purchaser) shall be deemed to be
satisfied and discharged. Further, upon any such lease or sale,
the Company shall comply with the requirements of Section 4.10
hereof, the 1954 Code and the Code and the regulations
promulgated thereunder (including, without limitation, the taking
of remedial action with respect to the Bonds) as the same may
then be applicable.
The Company shall, within fifteen (15) days after the
delivery thereof, furnish to the Issuer and the Trustee a true
and complete copy of the agreements or other documents
effectuating any such assignment, lease or sale.
ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
SECTION 5.1. Events of Default. Each of the following shall
be an "Event of Default" under this Agreement:
(a) Failure by the Company to pay when due the principal or
redemption premium, if any, required to be paid in respect of the
Bonds pursuant to the Notes, failure by the Company to pay an
installment of interest required to be paid in respect of the
Bonds pursuant to this Agreement and the Notes, after such
interest has become due for a period of sixty (60) days, or the
failure by the Company to pay within 30 days of the date due any
other amounts required to be paid pursuant to this Agreement.
(b) Failure by the Company to observe and perform any
covenant, condition or agreement on its part to be observed or
performed hereunder, other than as referred to in subsection
(a) of this Section 5.1, for a period of 60 days after written
notice, specifying such failure and requesting that it be
remedied, is given to the Company by the Issuer or the Trustee,
unless the Issuer and the Trustee shall agree in writing to an
extension of such period prior to its expiration; provided,
however, if the failure stated in the notice cannot be corrected
within the applicable period, the Issuer and the Trustee will not
unreasonably withhold their consent to an extension of such
period if corrective action is instituted by the Company within
the applicable period and diligently pursued until the failure is
remedied.
(c) The expiration of a period of ninety (90) days
following:
(1) the adjudication of the Company as an involuntary
bankrupt by any court of competent jurisdiction;
(2) the entry of an order approving an involuntary
petition seeking reorganization or arrangement of the
Company under the federal bankruptcy laws or any other
applicable law or statute of the United States of America,
or of any state thereof; or
(3) the appointment in an involuntary proceeding of a
trustee or a receiver of all or substantially all of the
property of the Company;
unless during such period such adjudication, order or appointment
of a trustee or receiver shall be vacated or shall be stayed on
appeal or otherwise or shall have otherwise ceased to continue in
effect.
(d) The filing by the Company of a voluntary petition in
bankruptcy or the making of an assignment for the benefit of
creditors; the consenting by the Company to the appointment of a
receiver or trustee of all or any part of its property; the
filing by the Company of a petition or answer seeking
reorganization, adjustment, composition or arrangement under the
federal bankruptcy laws, or any other applicable law or statute
of the United States of America, or of any state thereof; or the
filing by the Company of a petition to take advantage of any
insolvency act.
The foregoing provisions of Section 5.1(b) are subject to
the limitation that, if by reason of force majeure the Company is
unable in whole or in part to carry out its agreements herein
contained other than those set forth in Sections 4.5 and 4.10
hereof, an Event of Default shall not be deemed to have occurred
during the continuance of such inability. The term "force
majeure" as used herein shall mean the following: acts of God;
strikes; lockouts or other industrial disturbances; acts of
public enemies; orders of any kind of the government of the
United States of America or of any state or any of their
departments, agencies or officials or of any civil or military
authority; insurrections; riots; epidemics; landslides;
lightning; earthquakes; fire; hurricanes; tornadoes; storms;
floods; washouts; droughts; arrests; restraints of government and
people; civil disturbances; explosions; breakage or accident to
machinery, transmission lines, pipes or canals; partial or entire
failure of utilities; or any other cause or event not reasonably
within the control of the Company. The Company agrees, however,
to remedy to the extent practicable with all reasonable dispatch
the effects of any force majeure preventing the Company from
carrying out its agreements; provided that the settlement of
strikes, lockouts and other industrial disturbances shall be
entirely within the discretion of the Company, and the Company
shall not be required to make settlement of strikes, lockouts and
other industrial disturbances by acceding to the demands of the
opposing party or parties when such course is in the judgment of
the Company unfavorable to the Company.
SECTION 5.2. Remedies on Default. Whenever any Event of
Default shall have occurred and be continuing, the Issuer may, in
addition to any other remedy now or hereafter existing at law, in
equity or by statute, take either or both of the following
remedial steps:
(a) By written notice to the Company, the Issuer may
declare all amounts payable pursuant to the Notes to be
immediately due and payable, whereupon the same shall become
immediately due and payable.
(b) The Issuer may take whatever action at law or in equity
may appear necessary or desirable to collect the amounts referred
to in (a) above then due and thereafter to become due, or to
enforce performance and observance of any obligation, agreement
or covenant of the Company under this Agreement.
Any amounts collected pursuant to action taken under this
Section 5.2 shall be paid into the Bond Fund and applied in
accordance with the provisions of the Indenture or, if the Bonds
have been fully paid (or provision for payment thereof has been
made in accordance with the provisions of the Indenture) and the
fees and expenses of the Issuer, the Trustee and the paying
agents and all other amounts required to be paid under the
Indenture and hereunder shall have been paid, to the Company.
SECTION 5.3. Agreement to Pay Attorneys' Fees and Expenses.
In the event the Company should breach any of the provisions of
the Notes or this Agreement and the Issuer or the Trustee should
employ attorneys or incur other expenses for the collection of
amounts payable hereunder or the enforcement of performance or
observance of any obligation or agreement on the part of the
Company herein contained, the Company agrees that it will on
demand therefor pay to the Issuer or the Trustee the reasonable
fees of such attorneys and such other reasonable expenses so
incurred by the Issuer or the Trustee.
SECTION 5.4. No Additional Waiver Implied by One Waiver. In
the event any provision contained in this Agreement should be
breached by either party and thereafter waived by the other
party, such waiver shall be limited to the particular breach so
waived and shall not be deemed to waive any other breach
hereunder.
ARTICLE VI
MISCELLANEOUS
SECTION 6.1. Term of this Agreement. This Agreement shall
remain in full force and effect from the date hereof until such
time as all of the outstanding Bonds shall have been fully paid
or provision made therefor in accordance with the provisions of
the Indenture, whichever shall first occur, and the fees and
expenses of the Issuer, the Trustee and any paying agents and all
other amounts payable by the Company under this Agreement and the
Notes shall have been paid.
SECTION 6.2. Notices. All notices, certificates or other
communications hereunder shall be sufficiently given and shall be
deemed given when delivered or mailed by registered or certified
mail, postage prepaid, addressed as follows: if to the Issuer, at
1306 Walter Sillers Building, 550 High Street, Jackson,
Mississippi 39205, Attention: Executive Director; if to the
Company, at 639 Loyola Avenue, New Orleans, Louisiana 70113;
Attention: Treasurer; and if to the Trustee, at Tower Marc
Plaza, 10161 Centurion Parkway, Jacksonville, Florida 32256,
Attention: Corporate Trust Division. A duplicate copy of each
notice, certificate or other communication given hereunder by
either the Issuer or the Company to the other shall also be given
to the Trustee. The Issuer, the Company and the Trustee may, by
notice given hereunder, designate any further or different
addresses to which subsequent notices, certificates or other
communications shall be sent.
SECTION 6.3. Binding Effect. This Agreement shall inure to
the benefit of and shall be binding upon the Issuer, the Company
and their respective successors and assigns, subject, however, to
the limitations contained in Section 4.5 hereof.
SECTION 6.4. Severability. In the event any provision of
this Agreement shall be held invalid or unenforceable by any
court of competent jurisdiction, such holding shall not inval
idate or render unenforceable any other provision hereof.
SECTION 6.5. Amounts Remaining in the Bond Fund. Any
amounts remaining in the Bond Fund upon termination of this
Agreement shall, to the extent provided by Section 5.08 of the
Indenture, belong to and be paid to the Company by the Trustee.
SECTION 6.6. Amendments. This Agreement may not be
effectively terminated except in accordance with the provisions
hereof and may not be effectively amended except by a written
agreement in accordance with Article XI of the Indenture and
signed by the parties hereto.
SECTION 6.7. Execution in Counterparts. This Agreement 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.
SECTION 6.8. Applicable Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State of Mississippi.
SECTION 6.9. Captions. The captions or headings in this
Agreement are for convenience only and in no way define, limit or
describe the scope or intent of any provisions or sections of
this Agreement.
SECTION 6.10. Other Financing. Notwithstanding anything in
this Agreement to the contrary, the Issuer and the Company may
hereafter enter into agreements to provide for the financing or
refinancing of costs of the Project or any portion thereof in
lieu of or in addition to the provisions herein for Additional
Bonds.
IN WITNESS WHEREOF, the Issuer and the Company have caused
this Agreement to be executed in their respective corporate names
and their respective corporate seals to be hereunto affixed and
attested by their duly authorized officers, all as of the date
first above written.
MISSISSIPPI BUSINESS FINANCE
CORPORATION
By
Executive Director
ATTEST:
Secretary
SYSTEM ENERGY RESOURCES, INC.
(SEAL)
By
Vice President and Treasurer
ATTEST:
Assistant Secretary
<PAGE>
STATE OF LOUISIANA
PARISH OF ORLEANS
Personally appeared before me, the undersigned authority in
and for the said parish and state, on this 3rd day of November,
1998, within my jurisdiction, the within named William T. Barry
and James Vernon Smith, Sr., who acknowledged that they are the
Executive Director and Secretary of the Mississippi Business
Finance Corporation, and that in said representative capacities
they executed the above and foregoing instrument, after first
having been duly authorized so to do.
Notary Public
My Commission Expires:
<PAGE>
STATE OF LOUISIANA
PARISH OF ORLEANS
Personally appeared before me, the undersigned authority in
and for the said parish and state, on this day of
November, 1998, within my jurisdiction, the within named Steven
C. McNeal and Christopher T. Screen, who acknowledged that they
are the Vice President and Treasurer and Assistant Secretary of
System Energy Resources, Inc., an Arkansas corporation, and that
for and on behalf of the said corporation and as its act and deed
they executed the above and foregoing instrument, after first
having been duly authorized by said corporation so to do.
Notary Public
My Commission Expires:
<PAGE>
EXHIBIT A
SYSTEM ENERGY RESOURCES, INC.
PROMISSORY NOTE
$ [DATE]
SYSTEM ENERGY RESOURCES, INC., a corporation organized and
existing under the laws of the State of Arkansas (the "Company"),
acknowledges itself indebted and for value received hereby
promises to pay to the order of the Mississippi Business Finance
Corporation (the "Issuer"), and its successors and assigns, the
principal sum of
Dollars ($ ) together with interest on the
unpaid principal balance thereof from the date hereof until the
Company's obligation with respect to the payment of such sum
shall be discharged at the rate borne by the Bonds referred to
below. As additional interest hereon there shall be payable, and
the Company promises to pay when due, amounts which shall equal
the redemption premium, if any, due on such Bonds in connection
with the redemption thereof.
This Note is issued to evidence the Loan (as defined in the
Agreement hereinafter referred to) of the Issuer to the Company
and the obligation of the Company to repay the same and shall be
governed by and be payable in accordance with the terms and
conditions of a loan agreement (the "Agreement") by and between
the Issuer and the Company, dated as of October 15, 1998,
pursuant to which the Issuer has loaned to the Company the
proceeds of the sale of the Issuer's $
Pollution Control Revenue Refunding Bonds (System Energy
Resources, Inc. Project) Series (the "Bonds"). Additional
similar Notes may be issued by the Company as provided in the
Agreement. This Note (together with the Agreement) has been
assigned to The Bank of New York Trust Company of Florida, N.A.
(the "Trustee"), acting pursuant to a trust indenture, dated as
of October 15, 1998 (the "Indenture") by and between the Issuer
and the Trustee, and may not be assigned by the Trustee except to
a successor Trustee pursuant to the terms of the Indenture. Such
assignment is made as security for the Bonds, and any other bonds
which are or may at any time be issued and outstanding under the
Indenture. The Bonds are dated and bear interest in accordance
with the provisions of the Indenture, payable on
and in each year commencing
at the rate of percent ( %) per
annum, and mature on . The Bonds are
subject to redemption prior to maturity as provided therein.
Subject to the provisions of the Agreement, payments hereon
are to be made by paying to the Trustee, as assignee of the
Issuer, in funds which will be immediately available on the date
payment is due, amounts which, and at or before times which,
shall correspond to the payments with respect to the principal of
and redemption premium, if any, and interest on the Bonds
whenever and in whatever manner the same shall become due,
whether at stated maturity, upon redemption or declaration or
otherwise. If at the date any payments on the Bonds are due
there are any available moneys in the Bond Fund established under
the Indenture, such moneys shall be credited against the payment
then due hereunder, first in respect of interest and then, to the
extent of remaining moneys, in respect of principal. Upon the
occurrence of an Event of Default, as defined in the Agreement,
the principal of and interest on this Note may be declared
immediately due and payable as provided in the Agreement.
Neither the officers of the Company nor any persons
executing this Note shall be liable personally or shall be
subject to any personal liability or accountability by reason of
the issuance hereof.
IN WITNESS WHEREOF, System Energy Resources, Inc. has caused
this Note to be executed in its corporate name and on its behalf
by its President, its Treasurer or a Vice President by his or her
manual signature, and its corporate seal to be impressed hereon
and attested by the manual signature of its Secretary or an
Assistant Secretary, all as of the date first above written.
SYSTEM ENERGY RESOURCES, INC.
(SEAL)
By
Title
ATTEST:
By
Title
ASSIGNMENT
Pay to the order of The Bank of New York Trust Company of
Florida, N.A., as assignee of the Mississippi Business Finance
Corporation, under the Trust Indenture, dated as of October 15,
1998, between the Mississippi Business Finance Corporation and
The Bank of New York Trust Company of Florida, N.A., as Trustee,
securing the payment of Mississippi Business Finance Corporation
Pollution Control Revenue Refunding Bonds (System Energy
Resources, Inc. Project) Series , in the original
principal amount of $ .
Dated:
MISSISSIPPI BUSINESS FINANCE
CORPORATION
By
Executive Director
Exhibit F-1(f)
November 11, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
With respect to (1) the Application-Declaration
("Application-Declaration") on Form U-1, as amended (File No.
70-8511), filed by System Energy Resources, Inc. (the
"Company") with the Securities and Exchange Commission
("Commission") under the Public Utility Holding Company Act of
1935, as amended, contemplating, among other things, the
entering into arrangements for the issuance and sale of one or
more series of tax-exempt bonds (the "Tax-Exempt Bonds"), (2)
the Commission's orders dated May 9, 1995, August 18, 1996 and
August 27, 1996 (the "Orders") permitting the Application-
Declaration, as amended, to become effective with respect to
the issuance and sale of said Tax-Exempt Bonds; and (3) the
subsequent consummation of November 4, 1998, of the entry by
the Company into a Loan Agreement with the Mississippi
Business Finance Corporation (the "Issuer"), and the related
redemption of outstanding pollution control revenue bonds
through the issuance by the Issuer of a new series of its Tax-
Exempt Bonds (the "Transactions"). In connection therewith, I
advise you that in my opinion:
(a) the Company is a corporation duly
organized and validly existing under the laws of the
State of Arkansas;
(b) the Transactions have been consummated in
accordance with the Application-Declaration, as
amended, and the Orders;
(c) all state laws that relate or are applicable
to the participation by the Company in the Transactions
(other than so-called "blue sky" or similar laws, upon
which we do not pass herein) have been complied with;
(d) the consummation of the Transactions by the
Company has not violated the legal rights of the
holders of any securities issued by the Company or any
associate company thereof.
My consent is hereby given to the use of this opinion
as an exhibit to the Certificate pursuant to Rule 24.
Very truly yours,
/s/ Ann G. Roy
Ann G. Roy
Senior Counsel -
Corporate and Securities
Exhibit F-2(f)
[Letterhead of Thelen Reid & Priest LLP]
November 12, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
We are familiar with (A) the Application-Declaration on
Form U-1 (File No. 70-8511), as amended, filed with the Public
Utility Holding Company Act of 1935, as amended, by System Energy
Resources, Inc. (the "Company") and the other companies named
therein contemplating, among other things, the entering into
arrangements for the issuance and sale of one or more series of
tax-exempt bonds (the "Tax-Exempt Bonds"), (B) the Securities and
Exchange Commission's Orders, dated May 9, 1995 and August 27,
1996, granting and permitting to become effective the Application-
Declaration, as amended, with respect to the foregoing matters,
and (C) the subsequent consummation, on November 4, 1998, of the
entry by the Company into a Loan Agreement with the Mississippi
Business Finance Corporation (the "Issuer"), and the related
refinancing of outstanding pollution control revenue bonds
through the issuance by the Issuer of a series of its Tax-Exempt
Bonds (the "Transactions"). In connection therewith, we advise
as follows:
(1) The Company is a corporation duly organized and
validly existing under the laws of the State of
Arkansas.
(2) The Transactions have been consummated in
accordance with the Application-Declaration, as
amended, and the Orders of the Commission with respect
thereto.
(3) All state laws that relate or are applicable to
the participation by the Company in the Transactions
(other than so-called "blue-sky" or similar laws, upon
which we do not pass herein) have been complied with.
(4) The consummation of the Transactions by the
Company has not violated the legal rights of the
holders of any securities issued by the Company or any
associate company thereof.
We are members of the New York Bar and, for purposes of
this opinion, do not hold ourselves out as experts on the laws of
any jurisdiction other than the State of New York and the United
States of America. In giving this opinion, we have relied, as to
all matters governed by the laws of the State of Arkansas and of
the State of Mississippi, upon an opinion of even date herewith
of Ann G. Roy, Senior Counsel -- Corporate and Securities of
Entergy Services, Inc., which is to be filed as an exhibit to the
Certificate pursuant to Rule 24.
We hereby consent to the use of this opinion as an
exhibit to the Certificate pursuant to Rule 24.
Very truly yours,
/s/ Thelen Reid & Priest LLP
THELEN REID & PRIEST LLP
