CERTIFICATE OF NOTIFICATION
Filed by
ALABAMA POWER COMPANY
Pursuant to order of the Securities and Exchange Commission dated
September 8, 1995 in the matter of File No. 70-8661.
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Alabama Power Company (the "Company") hereby certifies to said
Commission, pursuant to Rule 24, as follows:
1. A Fourth Supplementary Installment Sale Agreement
was made and entered into by and between the Company and The
Industrial Development Board of the Town of Columbia
(Alabama) (the "Board"), relating to $28,000,000 aggregate
principal amount of the Board's Pollution Control Revenue
Refunding Bonds (Alabama Power Company Project), 1995 Series
C, and all transactions relating thereto were carried out in
accordance with the terms and conditions of and for the
purposes represented by the application, as amended, and of
said order with respect thereto.
2. A Fifth Supplementary Installment Sale Agreement
was made and entered into by and between the Company and The
Industrial Development Board of the Town of Columbia
(Alabama) (the "Board"), relating to $27,000,000 aggregate
principal amount of the Board's Pollution Control Revenue
Refunding Bonds (Alabama Power Company Project), 1995 Series
D, and all transactions relating thereto were carried out in
accordance with the terms and conditions of and for the
purposes represented by the application, as amended, and of
said order with respect thereto.
3. A Sixth Supplementary Installment Sale Agreement
was made and entered into by and between the Company and The
Industrial Development Board of the Town of Columbia
(Alabama) (the "Board"), relating to $26,500,000 aggregate
principal amount of the Board's Pollution Control Revenue
Refunding Bonds (Alabama Power Company Project), 1995 Series
D, and all transactions relating thereto were carried out in
accordance with the terms and conditions of and for the
purposes represented by the application, as amended, and of
said order with respect thereto.
4. Filed herewith are the following exhibits:
Exhibit A - Copy of Fourth Supplementary Installment
Sale Agreement between the Board and the
Company, dated as of October 1, 1995.
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Exhibit B - Copy of Fifth Supplementary Installment
Sale Agreement between the Board and the
Company, dated as of October 1, 1995.
Exhibit C - Copy of Sixth Supplementary Installment
Sale Agreement between the Board and the
Company, dated as of October 1, 1995.
Exhibit D - Copy of Indenture of Trust relating to
the Series C Bonds between the Board and
SouthTrust Bank of Alabama, National
Association, dated as of October 1, 1995.
Exhibit E - Copy of Indenture of Trust relating to
the Series D Bonds between the Board and
SouthTrust Bank of Alabama, National
Association, dated as of October 1, 1995.
Exhibit F - Copy of Indenture of Trust relating to
the Series E Bonds between the Board and
SouthTrust Bank of Alabama, National
Association, dated as of October 1, 1995.
Exhibit G - Opinion of Balch & Bingham dated October
13, 1995.
Dated October 13, 1995 ALABAMA POWER COMPANY
By /s/Wayne Boston
Wayne Boston
Assistant Secretary
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Exhibit A
THE INDUSTRIAL DEVELOPMENT BOARD OF
THE TOWN OF COLUMBIA
and
ALABAMA POWER COMPANY
FOURTH SUPPLEMENTARY
INSTALLMENT SALE AGREEMENT
Dated as of October 1, 1995
Relating to
$28,000,000
Pollution Control Revenue Refunding Bonds, 1995 Series C
(Alabama Power Company Project)
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FOURTH SUPPLEMENTARY INSTALLMENT SALE AGREEMENT
TABLE OF CONTENTS
(This Table of Contents is for convenience of reference only and is not a part
of this Fourth Supplementary Installment Sale Agreement)
Page
Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I . . . . . . . . . . . . . . 2
DEFINITIONS . . . . . . . . . . . . . . 2
ARTICLE II . . . . . . . . . . . . . . 4
RELATIONSHIP OF AGREEMENT TO THE ORIGINAL AGREEMENT;
ISSUANCE OF THE BONDS . . . . . . . . . . . 4
Section 2.1. Relationship of Agreement to the Original Agreement . . 4
Section 2.2. Issuance of Bonds . . . . . . . . . . . . . . . . . . . 5
ARTICLE III . . . . . . . . . . . . . . 5
PROVISIONS FOR PAYMENT . . . . . . . . . . . 5
Section 3.1. Amounts Payable . . . . . . . . . . . . . . . . . . . . 5
Section 3.2. Obligation of the Company Unconditional . . . . . . . . 6
Section 3.3. Creation of Subordinated Security Interest . . . . . . 6
Section 3.4. Assignment and Pledge of Payments and Rights
Under this Agreement . . . . . . . . . . . . . . . . . 7
Section 3.5. Provision of Credit Agreement . . . . . . . . . . . . . 7
ARTICLE IV . . . . . . . . . . . . . . 7
SPECIAL COVENANTS . . . . . . . . . . . . 7
Section 4.1. No Warranty of Suitability by the Issuer . . . . . . . 7
Section 4.2. Use of Project . . . . . . . . . . . . . . . . . . . . 7
Section 4.3. Indemnity Against Claims . . . . . . . . . . . . . . . 7
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Section 4.4. Incorporation of Certain Provisions of the
Original Agreement . . . . . . . . . . . . . . . . . . 8
Section 4.5. Further Assurances and Corrective Instruments . . . . . 8
Section 4.6. Tax Covenants . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE V . . . . . . . . . . . . . . 9
EVENTS OF DEFAULT AND REMEDIES . . . . . . . . . 9
Section 5.1. Events of Default . . . . . . . . . . . . . . . . . . . 9
Section 5.2. Remedies on Default . . . . . . . . . . . . . . . . . . 10
Section 5.3. Agreement to Pay Attorneys' Fees and Expenses . . . . . 11
Section 5.4. No Additional Waiver Implied by One Waiver . . . . . . 11
ARTICLE VI . . . . . . . . . . . . . . 11
MISCELLANEOUS . . . . . . . . . . . . . 11
Section 6.1. Term of This Agreement . . . . . . . . . . . . . . . . 11
Section 6.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 6.3. Binding Effect . . . . . . . . . . . . . . . . . . . . 12
Section 6.4. Severability . . . . . . . . . . . . . . . . . . . . . 12
Section 6.5. Amounts Remaining Under the Indenture . . . . . . . . . 12
Section 6.6. Amendments . . . . . . . . . . . . . . . . . . . . . . 12
Section 6.7. Execution in Counterparts . . . . . . . . . . . . . . . 12
Section 6.8. Applicable Law . . . . . . . . . . . . . . . . . . . . 12
Section 6.9. Captions . . . . . . . . . . . . . . . . . . . . . . . 12
Section 6.10. Other Financing . . . . . . . . . . . . . . . . . . . . 12
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FOURTH SUPPLEMENTARY INSTALLMENT SALE AGREEMENT dated as of October 1,
1995 between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF COLUMBIA, a
public corporation duly created and validly existing pursuant to the
constitution and laws of the State of Alabama (the "Issuer"), and ALABAMA
POWER COMPANY, a corporation organized and existing under the laws of the
State of Alabama (the "Company"), evidencing the agreement of the parties
hereto.
RECITALS
WHEREAS, the Issuer was organized pursuant to the provisions of Act No.
648 enacted at the 1949 Regular Session of the Legislature of Alabama, as
heretofore amended, and further supplemented by Act No. 1893 enacted at the
1971 Regular Session of the Legislature of Alabama and Act No. 510 enacted at
the 1982 Regular Session of the Legislature of Alabama (said Act No. 648, as
amended and supplemented being herein called the "Act"); and
WHEREAS, under the Act the Issuer has the following, among other,
powers:
(a) to acquire, whether by construction, purchase,
exchange, gift, lease, or otherwise, and to enlarge, improve,
replace, equip and maintain, one or more pollution control
facilities, including all real and personal property deemed
necessary or desirable in connection therewith,
(b) to issue its revenue bonds to pay the cost of
pollution control facilities payable solely from the revenues and
receipts derived from the leasing or sale by the Issuer of such
pollution control facilities,
(c) to lease or sell to others and otherwise dispose of
all or any portion of such pollution control facilities, and
(d) to issue its refunding bonds for the purpose of paying
the principal of, premium, if any, and interest on, its
outstanding revenue bonds; and
WHEREAS, in order to promote the health, safety and prosperity of the
citizens of the State of Alabama through the protection of its air and water
resources, the Issuer has previously undertaken to acquire, construct,
install, equip, and sell to the Company facilities, or portions thereof,
designed for the abatement or control of air and water pollution and sewage
treatment and disposal at the site of the Company's Farley Plant, located
within the geographical area of operation of the Issuer in Houston County,
Alabama, which facilities comprise the Project (hereinafter defined); and
WHEREAS, at the request of the Company, the Issuer has agreed to issue
$28,000,000 aggregate principal amount of its Pollution Control Revenue
Refunding Bonds, 1995 Series C (Alabama Power Company Project) and to apply
the proceeds from the sale thereof toward the redemption of certain of the
Issuer's pollution control revenue bonds previously issued to provide
financing for the Project;
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NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter contained the receipt and sufficiency of which are
hereby acknowledged, the parties hereto formally covenant, agree, and bind
themselves as follows:
ARTICLE I
DEFINITIONS
The terms defined in the Indenture are used herein with the same
meanings given to such terms in the Indenture. In addition, the following
terms shall have the meanings set out below:
"Agreement" means this Fourth Supplementary Installment Sale Agreement
and any amendments and supplements hereto.
"Bonds" means the Pollution Control Revenue Refunding Bonds (Alabama
Power Company Project), 1995 Series C, issued by the issuer under the
Indenture in the aggregate principal amount of $28,000,000.
"Event of Default" means any of the occurrences enumerated in Section
5.1 of this Agreement.
"First Mortgage" means the Indenture dated as of June 1, 1942, as
heretofore and hereafter supplemented and amended, between the Company and
Chemical Bank, as Trustee, securing first mortgage bonds of the Company
heretofore or hereafter issued thereunder.
"Indenture" means the Indenture of Trust dated as of October 1, 1995,
relating to the Bonds, between the Issuer and SouthTrust Bank of Alabama,
National Association, as Trustee, pursuant to which the Bonds are authorized
to be issued, and including any indenture supplemental thereto.
"1995 Series D Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, 1995 Series D (Alabama Power Company Project), in the
aggregate principal amount of $27,000,000, issued concurrently with the Bonds.
"1995 Series E Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, 1995 Series E (Alabama Power Company Project) in the
aggregate principal amount of $26,500,000 issued concurrently with the Bonds.
"Original Agreement" means the Installment Sale Agreement dated as of
May 1, 1978 between the Issuer and the Company, as heretofore supplemented and
amended, excluding, however, the Supplementary Installment Sale Agreement
dated as of September 1, 1994, the Second Supplementary Installment Sale
Agreement dated as of May 1, 1995, the Third Supplementary Installment Sale
Agreement dated as of May 1, 1995, this Agreement, the Fifth Supplementary
Installment Sale Agreement dated as of October 1, 1995 and the Sixth
Supplementary Installment Sale Agreement dated as of October 1, 1995.
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"Original Indenture" means the Trust Indenture dated as of May 1, 1978
by and between the Issuer and the Trustee, as supplemented and amended by a
First Supplemental Indenture dated as of November 1, 1984, a Second
Supplemental Indenture dated as of December 1, 1984, a Third Supplemental
Indenture dated as of June 1, 1985, a Fourth Supplemental Indenture dated as
of December 1, 1985, a Fifth Supplemental Indenture dated as of December 31,
1985, a Sixth Supplemental Indenture dated as of November 1, 1986 and a
Seventh Supplemental Indenture dated as of June 1, 1993.
"Project" means the air and water pollution control and solid waste
disposal facilities financed and refinanced from the proceeds of the Series E
Bonds as described in Exhibit A to the Original Agreement.
"Series A Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series A (Alabama Power Company Farley Plant Project), dated May 1, 1978, in
the original aggregate principal amount of $1,650,000.
"Series B Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series B (Alabama Power Company Farley Plant Project), dated November 1, 1984,
in the original aggregate principal amount of $100,000,000.
"Series C Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series C (Alabama Power Company Farley Plant Project), dated December 1, 1984,
in the original aggregate principal amount of $50,000,000.
"Series D Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series D (Alabama Power Company Farley Plant Project), dated June 1,
1985, in the original aggregate principal amount of $50,000,000, for the
purpose of refunding the Series C Bonds.
"Series E Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series E (Alabama Power Company Farley Plant Project), dated December 1, 1985,
issued in the original aggregate principal amount of $81,500,000.
"Series F Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series F (Alabama Power Company Farley Plant Project), dated December 31,
1985, issued in the original aggregate principal amount of $21,000,000.
"Series G Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series G (Alabama Power Company Farley Plant Project), dated November
1, 1986, issued in the original principal amount of $21,000,000, for the
purpose of refunding the Series F Bonds.
"Series H Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series H (Alabama Power Company Farley Plant Solid Waste Project), dated June
1, 1993, issued in the original aggregate principal amount of $9,800,000.
"Series 1994 Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, Series 1994 (Alabama Power Company Project), dated September
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1, 1994, issued in the original aggregate principal amount of $101,650,000,
for the purpose of refunding the Series A Bonds and the Series B Bonds.
"Subordinated Security Interest" means the security interest in the
Project created in Section 3.3 hereof.
ARTICLE II
RELATIONSHIP OF AGREEMENT TO THE ORIGINAL AGREEMENT;
ISSUANCE OF THE BONDS
Section 2.1. Relationship of Agreement to the Original Agreement.
The Original Agreement was initially executed and delivered by the Issuer and
the Company in connection with the issuance and sale of the Series A Bonds and
was supplemented and amended from time to time thereafter in connection with
the issuance and sale of the Series B, C, D, E, F, G and H Bonds. Under the
terms of the Original Agreement, the Issuer agreed to finance, acquire,
construct, install and equip the Project and to sell the Project to the
Company. The Company agreed, inter alia, to assist the Issuer in the
implementation of the Project and to purchase the Project for a purchase price
payable in installments due at such times and in such amounts as would provide
funds sufficient to pay the principal of, premium, if any, and interest on all
bonds issued under the Original Indenture when due, whether at stated maturity
upon redemption or acceleration, or otherwise. The Issuer and the Company
have heretofore arranged for the redemption of the Series A Bonds, the Series
B Bonds, the Series C Bonds, the Series F Bonds and the Series D Bonds and as
a result, the installment payments currently required of the Company under the
Original Agreement relate only to the Series E, G and H Bonds. Upon the
redemption of the Series E Bonds from proceeds of the Bonds, the 1995 Series D
Bonds and the 1995 Series E Bonds, the Company will no longer be obligated to
make installment payments under the Original Agreement with respect to the
Series E Bonds but will retain its obligations with respect to the Series G
and H Bonds. By their execution and delivery of this Agreement, which is
intended to be complementary to the Original Agreement, the Issuer and the
Company ratify and confirm the sale of the Project to the Company pursuant to
the Original Agreement, agree to continue the Original Agreement in full force
and effect except for the provisions thereof requiring the Company to make
purchase price payments related to bonds of the Issuer which have been fully
paid and redeemed, and agree that from and after the date of this Agreement
the Company will make additional purchase price payments in installments due
at such times and in such amounts as will provide funds sufficient to pay the
principal of, premium, if any, interest on, and purchase price of all Bonds
issued under the Indenture. The parties acknowledge and confirm that the
Issuer's agreement to issue the Bonds and to apply the proceeds thereof to the
redemption of the Series E Bonds (thereby reducing the Company's payment
obligations under the Original Agreement) constitutes fair and adequate
consideration for the additional obligations undertaken by the Company
pursuant to this Agreement. To the extent that any statement in, or provision
of, this Agreement conflicts with the Original Agreement, the provisions of
this Agreement shall be deemed to control.
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Section 2.2. Issuance of Bonds. In order to provide funds to
refund a portion of the Series E Bonds, the Issuer agrees that it will
initially issue and deliver the Bonds to the purchasers thereof at a price to
be approved in advance by the Company and will 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.
ARTICLE III
PROVISIONS FOR PAYMENT
Section 3.1. Amounts Payable. The Company agrees to pay to the
Trustee, as assignee of the Issuer, in funds which will be immediately
available on the day payment is due, from time to time as the amount owed
hereunder, including interest thereon (which interest obligation shall equal
the interest and premium, if any, on the Bonds), amounts which, and at or
before times which, shall correspond (i) to the payments in respect of the
principal of and 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 acceleration or otherwise, and (ii) the purchase price of the
Bonds required or permitted to be purchased under the Indenture. If (i) at
the date any payment on the Bonds is due, available moneys are held by the
Trustee under the Indenture which are not being held for the payment of Bonds
due and payable but which have not been presented for payment, or (ii) on any
date on which Bonds are to be purchased pursuant to Section 4.02 of the
Indenture, there are any available moneys held for the payment of the purchase
price which are not being held for the purchase of Bonds which have not been
presented for purchase pursuant to Section 6 of the form of Bonds, then, in
each case, such moneys shall be credited against the payment then due
hereunder, first in respect of interest on the amount then due and owing
hereunder and then, to the extent of remaining moneys, in respect of principal
on the amount then due and owing hereunder.
The Company will also pay: (i) the fees, charges and reasonable
expenses of the Trustee, any paying agents and the Remarketing Agent under the
Indenture, such fees, charges, and reasonable expenses to be paid directly to
the Trustee, paying agents and Remarketing Agent for their respective accounts
as and when such fees, charges and reasonable expenses become due and payable,
(ii) any expenses and costs incurred or to be incurred by virtue of the
issuance of the Bonds, (iii) any expenses in connection with any redemption of
the Bonds, and (iv) any expenses in connection with the redemption of the
Series E Bonds.
The Company also agrees that, on or before the date of redemption of the
Series E Bonds, it will pay to the Series E Trustee for deposit into the Bond
Fund held by the Series E Trustee in connection with the Series E Bonds, an
amount of funds which, when added to the proceeds of the Bonds (other than
proceeds, if any, representing accrued interest), the proceeds of the 1995
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Series D Bonds and the proceeds of the 1995 Series E Bonds deposited in such
Bond Fund, plus any investment earnings thereon, and any other funds available
for such purpose, will be sufficient to permit the Series E Trustee to pay the
principal of, premium and accrued interest on the Series E Bonds upon their
redemption, which shall be on or before December 31, 1995.
Section 3.2. Obligation of the Company Unconditional. The
obligation of the Company to make the payments as provided in this Agreement
and to perform and observe the other agreements on its part contained herein
shall be absolute and unconditional notwithstanding failure of the Issuer's
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 Alabama 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 3.2
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 any
diminution of the amounts payable under Section 3.1 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 of the Project
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 3.3. Creation of Subordinated Security Interest. As
security for the performance by the Company of its obligations under Section
3.1 hereof, the Company hereby grants to the Issuer a security interest in the
Project and in each component thereof which has been or will be acquired
hereunder by the Company from the Issuer. It is agreed that the security
interest hereby granted is hereby made, and shall at all times be, subject to
the lien of the First Mortgage and to the lien created pursuant to the
Original Agreement. The rights of the trustee and bondholders thereunder,
shall be equal in rank to, but not superior to, any future liens created for
the benefit of any indebtedness of the Company hereafter issued under an
indenture providing that any lien for the benefit of such indebtedness shall
be equal in rank to the security interest hereby granted. Such security
interest shall remain in effect until the Company shall have satisfied its
obligations under Section 3.1 hereof at which time the Issuer shall cause the
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execution and delivery to the Company of such documents as shall be necessary
to effect or evidence the termination of such security interest.
Section 3.4. Assignment and Pledge of Payments and Rights Under
this 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
this Agreement, including the Subordinated Security Interest, and all moneys
receivable hereunder (except for payments under the second and third
paragraphs of Section 3.1 and 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.
Section 3.5. Provision of Credit Agreement. On or before the date
of initial issuance of the Bonds, the Company shall enter into the Credit
Agreement for the purpose of providing the Company with a committed source of
funds, if needed, with which to perform its obligations under Section 3.1
hereof to provide any funds necessary to purchase Bonds which have been
tendered for purchase but not remarketed. The Company shall be under no
obligation to maintain the Credit Agreement in place during the term of the
Bonds, except that the Company shall not voluntarily terminate the Credit
Agreement at any time during which the Bonds are in a Commercial Paper Period.
In addition, the Company hereby agrees to notify the Trustee and the
Remarketing Agent in writing at least 20 Business Days prior to any
termination of the Credit Agreement at the request of the Company.
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 hereby covenants and
agrees that it will not take any action, other than pursuant to the exercise
of its rights under Section 5.2 of this Agreement and under the corresponding
provisions of the Original 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, cooperate with
the Company in order that the Company may have possession and enjoyment of the
Project.
Section 4.3. Indemnity Against Claims. The Company will pay and
discharge and will indemnify and hold harmless the Issuer from (a) any lien or
charge upon payments by the Company hereunder, (b) any taxes, assessments,
impositions, and other charges upon payments by the Company to the Issuer
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hereunder, and (c) any and all liabilities, damages, costs, and expenses
arising out of or resulting from the transactions contemplated by this
Agreement and the Indenture, 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 will give prompt 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. Incorporation of Certain Provisions of the Original
Agreement. The provisions of the following sections of the Original Agreement
are incorporated herein by reference with the effect that the terms of such
sections shall apply with the same force and effect as if set out in full
herein: Section 6.2 (relating to inspection of the Project); Section 6.3
(relating to maintenance of the Company's corporate existence); Section 6.4
(relating to the provision of certain financial statements); Section 5.1
(relating to maintenance of the Project); Section 5.2 (relating to removal of
portions of the Project); Section 5.3 (relating to the payment of taxes and
other governmental charges); Section 5.4 (relating to insurance); Section 5.5
(relating to eminent domain); and Section 7.1 (relating to the Company's right
to assign its interest in the Original Agreement and to lease the Project).
The provisions so incorporated shall remain in force throughout the term of
this Agreement notwithstanding any earlier termination of the Original
Agreement.
Section 4.5. 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.
The Issuer will, upon the request and at the expense of the Company,
cause the execution and delivery from time to time to the Company of such
further instruments of conveyance as are deemed by the Company to be necessary
to effect or evidence the conveyance to the Company of good and marketable
title to the Project or any portion thereof, subject to no lien other than any
Permitted Encumbrances (as defined in the Original Agreement).
Section 4.6. Tax Covenants. The Company and the Issuer covenant
and agree that they 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" 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
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result in the loss of the exclusion from gross income for federal income tax
purposes of the interest paid on the Bonds. Without limiting the generality
of the foregoing, the Company covenants and agrees to comply with the
requirements of Sections 148(d) and 148(f) of the Code and any proposed,
temporary, or final regulations thereunder as may be applicable to the Bonds
or the proceeds derived from the sale of the Bonds or any other moneys. The
Company acknowledges Section 6.03 of the Indenture and agrees to perform all
duties imposed upon it by such Section. Insofar as said Section imposes
duties and responsibilities on the Company, it is specifically incorporated
herein by reference.
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 or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
interest due or becoming due on any of the Bonds for a period of five
days after the same shall become due and payable.
(b) Failure by the Company to pay or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
principal of, or premium, if any, on any of the Bonds when the same
shall become due and payable.
(c) Failure by the Company to pay or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
purchase price on any of the Bonds after the same shall become due and
payable.
(d) Failure by the Company to observe and perform any covenant,
condition, or agreement in this Agreement on its part to be observed or
performed, other than as referred to in subsections (a), (b), and (c) of
this Section, for a period of 90 days after written notice, specifying
such failure and requesting that it be remedied, is given to the Company
by the Issuer or the Trustee.
` (e) The dissolution or liquidation of the Company, except as
permitted by Section 4.4 hereof, or the commencement by the Company of
any case or proceeding seeking to have an order for relief entered on
its behalf as a debtor or to adjudicate it as bankrupt or insolvent or
seeking reorganization, liquidation, dissolution, winding-up,
arrangement, composition, readjustment of its debts or any other relief
under any bankruptcy, insolvency, reorganization or other similar law of
the United States or any state, or adjudication of the Company as
bankrupt, or an assignment by the Company for the benefit of its
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<PAGE>
creditors, or the entry by the Company into an agreement of composition
with its creditors, or the approval by a court of competent jurisdiction
of a petition applicable to the Company in any proceeding for its
reorganization instituted under the provisions of Title 11 of the United
States Code, as amended, or under any similar statutory provision which
may hereafter be enacted.
(f) An "event of default" as defined in Section 8.01 of the
Indenture shall have occurred and be continuing.
A default under clause (d) of this Section is not an Event of Default until
the Trustee or the holders of at least 25% in principal amount of the Bonds
then outstanding give the Issuer and the Company a notice specifying the
default, demanding that it be remedied and stating that the notice is a
"Notice of Default" and the Company does not cure the default within 90 days
after receipt of the notice, or within such longer period as the Trustee shall
agree to. The Trustee shall not unreasonably refuse to agree to a longer
period if the default cannot reasonably be cured within 90 days after receipt
of the notice and the Company has begun within 90 days and continued diligent
efforts to correct the default. The foregoing provisions of clause (d) of
this Section are subject to the further qualification 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 the obligations on the part of the
Company contained in Section 6.3 of the Original Agreement (incorporated by
reference in Section 4.4 hereof) and Section 4.6 hereof, the Company shall not
be deemed in default 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 or of the State or
of any of their departments, agencies or officials, or of any civil or
military authority; insurrections; riots; epidemics; landslides; lightning;
earthquake; fire; hurricanes; storms; floods; washouts; droughts; arrests;
restraint of government and people; civil disturbances; explosions; breakage
or accident to machinery; 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 with all reasonable dispatch the cause or causes
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 the
total amount payable under clause (i) of the first sentence of the first
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<PAGE>
paragraph of Section 3.1 of this Agreement, including the interest
thereon, 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 to the Trustee 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 Trustee, the paying agents, and the Remarketing
Agent and all other amounts required to be paid under the Indenture shall have
been paid, to the Company.
Section 5.3. Agreement to Pay Attorneys' Fees and Expenses. If the
Company should breach any of the provisions of 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. If 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 Trustee, any paying agents and the
Remarketing Agent and all other amounts payable by the Company under this
Agreement 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, if by mail to the Chairman of the
Board of Directors, at Town Hall, Columbia, Alabama 36319; if to the Trustee,
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<PAGE>
to P. O. Box 2554, Birmingham, Alabama 35290, Attention: Corporate Trust
Department; if to the Company, to 600 North 18th Street, Birmingham, Alabama
35203, Attention: Treasurer; and if to the Remarketing Agent, to Lehman
Brothers Inc., 200 Vesey Street, 8th Floor, New York, New York 10285,
Attention: Municipal Note Desk. 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.
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 invalidate or render unenforceable any
other provision hereof.
Section 6.5. Amounts Remaining Under the Indenture. Any amounts
remaining under the Indenture upon termination of this Agreement shall, to the
extent provided by Section 7.03 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 X
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 Alabama.
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.
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<PAGE>
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.
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
ATTEST:
Secretary
ALABAMA POWER COMPANY
By:
Vice President
ATTEST:
Secretary
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<PAGE>
STATE OF ALABAMA
COUNTY OF
I, , a Notary
Public in and for said county in said state, hereby certify that William D.
Lanford, Jr., whose name as Chairman of the Board of Directors of The
Industrial Development Board of the Town of Columbia, a public corporation and
instrumentality under the laws of the State of Alabama, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this
day that, being informed of the contents of the within instrument, he, as such
officer and with full authority executed the same voluntarily for and as the
act of said public corporation.
Given under my hand and official seal of office this _____ day of
October, 1995.
Notary Public
My Commission Expires:
[SEAL]
STATE OF ALABAMA
COUNTY OF
I, , a Notary
Public in and for said county in said state, hereby certify that
, whose name as _______________________ of
Alabama Power Company, a corporation organized and existing under the laws of
the State of Alabama, is signed to the foregoing instrument and who is known
to me, acknowledged before me on this day that, being informed of the contents
of the within instrument, he, as such officer and with full authority executed
the same voluntarily for and as the act of said corporation.
Given under my hand and official seal of office this ____ day of
October, 1995.
Notary Public
My Commission Expires:
[SEAL]
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<PAGE>
Exhibit B
THE INDUSTRIAL DEVELOPMENT BOARD OF
THE TOWN OF COLUMBIA
and
ALABAMA POWER COMPANY
FIFTH SUPPLEMENTARY
INSTALLMENT SALE AGREEMENT
Dated as of October 1, 1995
Relating to
$27,000,000
Pollution Control Revenue Refunding Bonds, 1995 Series D
(Alabama Power Company Project)
<PAGE>
FIFTH SUPPLEMENTARY INSTALLMENT SALE AGREEMENT
TABLE OF CONTENTS
(This Table of Contents is for convenience of reference only and is not a
part of this Fifth Supplementary Installment Sale Agreement)
Page
Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I . . . . . . . . . . . . . . . 2
DEFINITIONS . . . . . . . . . . . . . . 2
ARTICLE II . . . . . . . . . . . . . . 4
RELATIONSHIP OF AGREEMENT TO THE ORIGINAL AGREEMENT;
ISSUANCE OF THE BONDS . . . . . . . . . . . . 4
Section 2.1. Relationship of Agreement to the Original
Agreement . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.2. Issuance of Bonds . . . . . . . . . . . . . . . . . . . 5
ARTICLE III . . . . . . . . . . . . . . 5
PROVISIONS FOR PAYMENT . . . . . . . . . . . 5
Section 3.1. Amounts Payable . . . . . . . . . . . . . . . . . . . . 5
Section 3.2. Obligation of the Company Unconditional . . . . . . . . 6
Section 3.3. Creation of Subordinated Security Interest . . . . . . 6
Section 3.4. Assignment and Pledge of Payments and Rights
Under this Agreement . . . . . . . . . . . . . . . . . 7
Section 3.5. Provision of Credit Agreement . . . . . . . . . . . . . 7
ARTICLE IV . . . . . . . . . . . . . . 7
SPECIAL COVENANTS . . . . . . . . . . . . . 7
Section 4.1. No Warranty of Suitability by the Issuer . . . . . . . 7
Section 4.2. Use of Project . . . . . . . . . . . . . . . . . . . . 7
Section 4.3. Indemnity Against Claims . . . . . . . . . . . . . . . 7
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<PAGE>
Section 4.4. Incorporation of Certain Provisions of the
Original Agreement . . . . . . . . . . . . . . . . . . 8
Section 4.5. Further Assurances and Corrective Instruments . . . . . 8
Section 4.6. Tax Covenants . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE V . . . . . . . . . . . . . . . 9
EVENTS OF DEFAULT AND REMEDIES . . . . . . . . . 9
Section 5.1. Events of Default . . . . . . . . . . . . . . . . . . . 9
Section 5.2. Remedies on Default . . . . . . . . . . . . . . . . . . 10
Section 5.3. Agreement to Pay Attorneys' Fees and Expenses . . . . . 11
Section 5.4. No Additional Waiver Implied by One Waiver . . . . . . 11
ARTICLE VI . . . . . . . . . . . . . . 11
MISCELLANEOUS . . . . . . . . . . . . . . 11
Section 6.1. Term of This Agreement . . . . . . . . . . . . . . . . 11
Section 6.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 6.3. Binding Effect . . . . . . . . . . . . . . . . . . . . 12
Section 6.4. Severability . . . . . . . . . . . . . . . . . . . . . 12
Section 6.5. Amounts Remaining Under the Indenture . . . . . . . . . 12
Section 6.6. Amendments . . . . . . . . . . . . . . . . . . . . . . 12
Section 6.7. Execution in Counterparts . . . . . . . . . . . . . . . 12
Section 6.8. Applicable Law . . . . . . . . . . . . . . . . . . . . 12
Section 6.9. Captions . . . . . . . . . . . . . . . . . . . . . . . 12
Section 6.10. Other Financing . . . . . . . . . . . . . . . . . . . . 12
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<PAGE>
FIFTH SUPPLEMENTARY INSTALLMENT SALE AGREEMENT dated as of October 1,
1995 between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF COLUMBIA, a
public corporation duly created and validly existing pursuant to the
constitution and laws of the State of Alabama (the "Issuer"), and ALABAMA
POWER COMPANY, a corporation organized and existing under the laws of the
State of Alabama (the "Company"), evidencing the agreement of the parties
hereto.
RECITALS
WHEREAS, the Issuer was organized pursuant to the provisions of Act No.
648 enacted at the 1949 Regular Session of the Legislature of Alabama, as
heretofore amended, and further supplemented by Act No. 1893 enacted at the
1971 Regular Session of the Legislature of Alabama and Act No. 510 enacted at
the 1982 Regular Session of the Legislature of Alabama (said Act No. 648, as
amended and supplemented being herein called the "Act"); and
WHEREAS, under the Act the Issuer has the following, among other,
powers:
(a) to acquire, whether by construction, purchase,
exchange, gift, lease, or otherwise, and to enlarge, improve,
replace, equip and maintain, one or more pollution control
facilities, including all real and personal property deemed
necessary or desirable in connection therewith,
(b) to issue its revenue bonds to pay the cost of
pollution control facilities payable solely from the revenues and
receipts derived from the leasing or sale by the Issuer of such
pollution control facilities,
(c) to lease or sell to others and otherwise dispose of
all or any portion of such pollution control facilities, and
(d) to issue its refunding bonds for the purpose of paying
the principal of, premium, if any, and interest on, its
outstanding revenue bonds; and
WHEREAS, in order to promote the health, safety and prosperity of the
citizens of the State of Alabama through the protection of its air and water
resources, the Issuer has previously undertaken to acquire, construct,
install, equip, and sell to the Company facilities, or portions thereof,
designed for the abatement or control of air and water pollution and sewage
treatment and disposal at the site of the Company's Farley Plant, located
within the geographical area of operation of the Issuer in Houston County,
Alabama, which facilities comprise the Project (hereinafter defined); and
WHEREAS, at the request of the Company, the Issuer has agreed to issue
$27,000,000 aggregate principal amount of its Pollution Control Revenue
Refunding Bonds, 1995 Series D (Alabama Power Company Project) and to apply
the proceeds from the sale thereof toward the redemption of certain of the
Issuer's pollution control revenue bonds previously issued to provide
financing for the Project;
<PAGE>
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter contained the receipt and sufficiency of which are
hereby acknowledged, the parties hereto formally covenant, agree, and bind
themselves as follows:
ARTICLE I
DEFINITIONS
The terms defined in the Indenture are used herein with the same
meanings given to such terms in the Indenture. In addition, the following
terms shall have the meanings set out below:
"Agreement" means this Fifth Supplementary Installment Sale Agreement
and any amendments and supplements hereto.
"Bonds" means the Pollution Control Revenue Refunding Bonds (Alabama
Power Company Project), 1995 Series D, issued by the issuer under the
Indenture in the aggregate principal amount of $27,000,000.
"Event of Default" means any of the occurrences enumerated in Section
5.1 of this Agreement.
"First Mortgage" means the Indenture dated as of June 1, 1942, as
heretofore and hereafter supplemented and amended, between the Company and
Chemical Bank, as Trustee, securing first mortgage bonds of the Company
heretofore or hereafter issued thereunder.
"Indenture" means the Indenture of Trust dated as of October 1, 1995,
relating to the Bonds, between the Issuer and SouthTrust Bank of Alabama,
National Association, as Trustee, pursuant to which the Bonds are authorized
to be issued, and including any indenture supplemental thereto.
"1995 Series C Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, 1995 Series C (Alabama Power Company Project), in the
aggregate principal amount of $28,000,000, issued concurrently with the Bonds.
"1995 Series E Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, 1995 Series E (Alabama Power Company Project) in the
aggregate principal amount of $26,500,000 issued concurrently with the Bonds.
"Original Agreement" means the Installment Sale Agreement dated as of
May 1, 1978 between the Issuer and the Company, as heretofore supplemented and
amended, excluding, however, the Supplementary Installment Sale Agreement
dated as of September 1, 1994, the Second Supplementary Installment Sale
Agreement dated as of May 1, 1995, the Third Supplementary Installment Sale
Agreement dated as of May 1, 1995, the Fourth Supplementary Installment Sale
Agreement dated as of October 1, 1995, this Agreement and the Sixth
Supplementary Installment Sale Agreement dated as of October 1, 1995.
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<PAGE>
"Original Indenture" means the Trust Indenture dated as of May 1, 1978
by and between the Issuer and the Trustee, as supplemented and amended by a
First Supplemental Indenture dated as of November 1, 1984, a Second
Supplemental Indenture dated as of December 1, 1984, a Third Supplemental
Indenture dated as of June 1, 1985, a Fourth Supplemental Indenture dated as
of December 1, 1985, a Fifth Supplemental Indenture dated as of December 31,
1985, a Sixth Supplemental Indenture dated as of November 1, 1986 and a
Seventh Supplemental Indenture dated as of June 1, 1993.
"Project" means the air and water pollution control and solid waste
disposal facilities financed and refinanced from the proceeds of the Series E
Bonds as described in Exhibit A to the Original Agreement.
"Series A Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series A (Alabama Power Company Farley Plant Project), dated May 1, 1978, in
the original aggregate principal amount of $1,650,000.
"Series B Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series B (Alabama Power Company Farley Plant Project), dated November 1, 1984,
in the original aggregate principal amount of $100,000,000.
"Series C Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series C (Alabama Power Company Farley Plant Project), dated December 1, 1984,
in the original aggregate principal amount of $50,000,000.
"Series D Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series D (Alabama Power Company Farley Plant Project), dated June 1,
1985, in the original aggregate principal amount of $50,000,000, for the
purpose of refunding the Series C Bonds.
"Series E Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series E (Alabama Power Company Farley Plant Project), dated December 1, 1985,
issued in the original aggregate principal amount of $81,500,000.
"Series F Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series F (Alabama Power Company Farley Plant Project), dated December 31,
1985, issued in the original aggregate principal amount of $21,000,000.
"Series G Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series G (Alabama Power Company Farley Plant Project), dated November
1, 1986, issued in the original principal amount of $21,000,000, for the
purpose of refunding the Series F Bonds.
"Series H Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series H (Alabama Power Company Farley Plant Solid Waste Project), dated June
1, 1993, issued in the original aggregate principal amount of $9,800,000.
"Series 1994 Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, Series 1994 (Alabama Power Company Project), dated September
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<PAGE>
1, 1994, issued in the original aggregate principal amount of $101,650,000,
for the purpose of refunding the Series A Bonds and the Series B Bonds.
"Subordinated Security Interest" means the security interest in the
Project created in Section 3.3 hereof.
ARTICLE II
RELATIONSHIP OF AGREEMENT TO THE ORIGINAL AGREEMENT;
ISSUANCE OF THE BONDS
Section 2.1. Relationship of Agreement to the Original Agreement.
The Original Agreement was initially executed and delivered by the Issuer and
the Company in connection with the issuance and sale of the Series A Bonds and
was supplemented and amended from time to time thereafter in connection with
the issuance and sale of the Series B, C, D, E, F, G and H Bonds. Under the
terms of the Original Agreement, the Issuer agreed to finance, acquire,
construct, install and equip the Project and to sell the Project to the
Company. The Company agreed, inter alia, to assist the Issuer in the
implementation of the Project and to purchase the Project for a purchase price
payable in installments due at such times and in such amounts as would provide
funds sufficient to pay the principal of, premium, if any, and interest on all
bonds issued under the Original Indenture when due, whether at stated maturity
upon redemption or acceleration, or otherwise. The Issuer and the Company
have heretofore arranged for the redemption of the Series A Bonds, the Series
B Bonds, the Series C Bonds, the Series F Bonds and the Series D Bonds and as
a result, the installment payments currently required of the Company under the
Original Agreement relate only to the Series E, G and H Bonds. Upon the
redemption of the Series E Bonds from proceeds of the Bonds, the 1995 Series C
Bonds and the 1995 Series E Bonds, the Company will no longer be obligated to
make installment payments under the Original Agreement with respect to the
Series E Bonds but will retain its obligations with respect to the Series G
and H Bonds. By their execution and delivery of this Agreement, which is
intended to be complementary to the Original Agreement, the Issuer and the
Company ratify and confirm the sale of the Project to the Company pursuant to
the Original Agreement, agree to continue the Original Agreement in full force
and effect except for the provisions thereof requiring the Company to make
purchase price payments related to bonds of the Issuer which have been fully
paid and redeemed, and agree that from and after the date of this Agreement
the Company will make additional purchase price payments in installments due
at such times and in such amounts as will provide funds sufficient to pay the
principal of, premium, if any, interest on, and purchase price of all Bonds
issued under the Indenture. The parties acknowledge and confirm that the
Issuer's agreement to issue the Bonds and to apply the proceeds thereof to the
redemption of the Series E Bonds (thereby reducing the Company's payment
obligations under the Original Agreement) constitutes fair and adequate
consideration for the additional obligations undertaken by the Company
pursuant to this Agreement. To the extent that any statement in, or provision
of, this Agreement conflicts with the Original Agreement, the provisions of
this Agreement shall be deemed to control.
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<PAGE>
Section 2.2. Issuance of Bonds. In order to provide funds to
refund a portion of the Series E Bonds, the Issuer agrees that it will
initially issue and deliver the Bonds to the purchasers thereof at a price to
be approved in advance by the Company and will 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.
ARTICLE III
PROVISIONS FOR PAYMENT
Section 3.1. Amounts Payable. The Company agrees to pay to the
Trustee, as assignee of the Issuer, in funds which will be immediately
available on the day payment is due, from time to time as the amount owed
hereunder, including interest thereon (which interest obligation shall equal
the interest and premium, if any, on the Bonds), amounts which, and at or
before times which, shall correspond (i) to the payments in respect of the
principal of and 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 acceleration or otherwise, and (ii) the purchase price of the
Bonds required or permitted to be purchased under the Indenture. If (i) at
the date any payment on the Bonds is due, available moneys are held by the
Trustee under the Indenture which are not being held for the payment of Bonds
due and payable but which have not been presented for payment, or (ii) on any
date on which Bonds are to be purchased pursuant to Section 4.02 of the
Indenture, there are any available moneys held for the payment of the purchase
price which are not being held for the purchase of Bonds which have not been
presented for purchase pursuant to Section 6 of the form of Bonds, then, in
each case, such moneys shall be credited against the payment then due
hereunder, first in respect of interest on the amount then due and owing
hereunder and then, to the extent of remaining moneys, in respect of principal
on the amount then due and owing hereunder.
The Company will also pay: (i) the fees, charges and reasonable
expenses of the Trustee, any paying agents and the Remarketing Agent under the
Indenture, such fees, charges, and reasonable expenses to be paid directly to
the Trustee, paying agents and Remarketing Agent for their respective accounts
as and when such fees, charges and reasonable expenses become due and payable,
(ii) any expenses and costs incurred or to be incurred by virtue of the
issuance of the Bonds, (iii) any expenses in connection with any redemption of
the Bonds, and (iv) any expenses in connection with the redemption of the
Series E Bonds.
The Company also agrees that, on or before the date of redemption of the
Series E Bonds, it will pay to the Series E Trustee for deposit into the Bond
Fund held by the Series E Trustee in connection with the Series E Bonds, an
amount of funds which, when added to the proceeds of the Bonds (other than
proceeds, if any, representing accrued interest), the proceeds of the 1995
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<PAGE>
Series C Bonds and the proceeds of the 1995 Series E Bonds deposited in such
Bond Fund, plus any investment earnings thereon, and any other funds available
for such purpose, will be sufficient to permit the Series E Trustee to pay the
principal of, premium and accrued interest on the Series E Bonds upon their
redemption, which shall be on or before December 31, 1995.
Section 3.2. Obligation of the Company Unconditional. The
obligation of the Company to make the payments as provided in this Agreement
and to perform and observe the other agreements on its part contained herein
shall be absolute and unconditional notwithstanding failure of the Issuer's
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 Alabama 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 3.2
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 any
diminution of the amounts payable under Section 3.1 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 of the Project
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 3.3. Creation of Subordinated Security Interest. As
security for the performance by the Company of its obligations under Section
3.1 hereof, the Company hereby grants to the Issuer a security interest in the
Project and in each component thereof which has been or will be acquired
hereunder by the Company from the Issuer. It is agreed that the security
interest hereby granted is hereby made, and shall at all times be, subject to
the lien of the First Mortgage and to the lien created pursuant to the
Original Agreement. The rights of the trustee and bondholders thereunder,
shall be equal in rank to, but not superior to, any future liens created for
the benefit of any indebtedness of the Company hereafter issued under an
indenture providing that any lien for the benefit of such indebtedness shall
be equal in rank to the security interest hereby granted. Such security
interest shall remain in effect until the Company shall have satisfied its
obligations under Section 3.1 hereof at which time the Issuer shall cause the
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execution and delivery to the Company of such documents as shall be necessary
to effect or evidence the termination of such security interest.
Section 3.4. Assignment and Pledge of Payments and Rights Under
this 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
this Agreement, including the Subordinated Security Interest, and all moneys
receivable hereunder (except for payments under the second and third
paragraphs of Section 3.1 and 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.
Section 3.5. Provision of Credit Agreement. On or before the date
of initial issuance of the Bonds, the Company shall enter into the Credit
Agreement for the purpose of providing the Company with a committed source of
funds, if needed, with which to perform its obligations under Section 3.1
hereof to provide any funds necessary to purchase Bonds which have been
tendered for purchase but not remarketed. The Company shall be under no
obligation to maintain the Credit Agreement in place during the term of the
Bonds, except that the Company shall not voluntarily terminate the Credit
Agreement at any time during which the Bonds are in a Commercial Paper Period.
In addition, the Company hereby agrees to notify the Trustee and the
Remarketing Agent in writing at least 20 Business Days prior to any
termination of the Credit Agreement at the request of the Company.
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 hereby covenants and
agrees that it will not take any action, other than pursuant to the exercise
of its rights under Section 5.2 of this Agreement and under the corresponding
provisions of the Original 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, cooperate with
the Company in order that the Company may have possession and enjoyment of the
Project.
Section 4.3. Indemnity Against Claims. The Company will pay and
discharge and will indemnify and hold harmless the Issuer from (a) any lien or
charge upon payments by the Company hereunder, (b) any taxes, assessments,
impositions, and other charges upon payments by the Company to the Issuer
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hereunder, and (c) any and all liabilities, damages, costs, and expenses
arising out of or resulting from the transactions contemplated by this
Agreement and the Indenture, 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 will give prompt 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. Incorporation of Certain Provisions of the Original
Agreement. The provisions of the following sections of the Original Agreement
are incorporated herein by reference with the effect that the terms of such
sections shall apply with the same force and effect as if set out in full
herein: Section 6.2 (relating to inspection of the Project); Section 6.3
(relating to maintenance of the Company's corporate existence); Section 6.4
(relating to the provision of certain financial statements); Section 5.1
(relating to maintenance of the Project); Section 5.2 (relating to removal of
portions of the Project); Section 5.3 (relating to the payment of taxes and
other governmental charges); Section 5.4 (relating to insurance); Section 5.5
(relating to eminent domain); and Section 7.1 (relating to the Company's right
to assign its interest in the Original Agreement and to lease the Project).
The provisions so incorporated shall remain in force throughout the term of
this Agreement notwithstanding any earlier termination of the Original
Agreement.
Section 4.5. 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.
The Issuer will, upon the request and at the expense of the Company,
cause the execution and delivery from time to time to the Company of such
further instruments of conveyance as are deemed by the Company to be necessary
to effect or evidence the conveyance to the Company of good and marketable
title to the Project or any portion thereof, subject to no lien other than any
Permitted Encumbrances (as defined in the Original Agreement).
Section 4.6. Tax Covenants. The Company and the Issuer covenant
and agree that they 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" 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
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result in the loss of the exclusion from gross income for federal income tax
purposes of the interest paid on the Bonds. Without limiting the generality
of the foregoing, the Company covenants and agrees to comply with the
requirements of Sections 148(d) and 148(f) of the Code and any proposed,
temporary, or final regulations thereunder as may be applicable to the Bonds
or the proceeds derived from the sale of the Bonds or any other moneys. The
Company acknowledges Section 6.03 of the Indenture and agrees to perform all
duties imposed upon it by such Section. Insofar as said Section imposes
duties and responsibilities on the Company, it is specifically incorporated
herein by reference.
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 or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
interest due or becoming due on any of the Bonds for a period of five
days after the same shall become due and payable.
(b) Failure by the Company to pay or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
principal of, or premium, if any, on any of the Bonds when the same
shall become due and payable.
(c) Failure by the Company to pay or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
purchase price on any of the Bonds after the same shall become due and
payable.
(d) Failure by the Company to observe and perform any covenant,
condition, or agreement in this Agreement on its part to be observed or
performed, other than as referred to in subsections (a), (b), and (c) of
this Section, for a period of 90 days after written notice, specifying
such failure and requesting that it be remedied, is given to the Company
by the Issuer or the Trustee.
` (e) The dissolution or liquidation of the Company, except as
permitted by Section 4.4 hereof, or the commencement by the Company of
any case or proceeding seeking to have an order for relief entered on
its behalf as a debtor or to adjudicate it as bankrupt or insolvent or
seeking reorganization, liquidation, dissolution, winding-up,
arrangement, composition, readjustment of its debts or any other relief
under any bankruptcy, insolvency, reorganization or other similar law of
the United States or any state, or adjudication of the Company as
bankrupt, or an assignment by the Company for the benefit of its
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<PAGE>
creditors, or the entry by the Company into an agreement of composition
with its creditors, or the approval by a court of competent jurisdiction
of a petition applicable to the Company in any proceeding for its
reorganization instituted under the provisions of Title 11 of the United
States Code, as amended, or under any similar statutory provision which
may hereafter be enacted.
(f) An "event of default" as defined in Section 8.01 of the
Indenture shall have occurred and be continuing.
A default under clause (d) of this Section is not an Event of Default until
the Trustee or the holders of at least 25% in principal amount of the Bonds
then outstanding give the Issuer and the Company a notice specifying the
default, demanding that it be remedied and stating that the notice is a
"Notice of Default" and the Company does not cure the default within 90 days
after receipt of the notice, or within such longer period as the Trustee shall
agree to. The Trustee shall not unreasonably refuse to agree to a longer
period if the default cannot reasonably be cured within 90 days after receipt
of the notice and the Company has begun within 90 days and continued diligent
efforts to correct the default. The foregoing provisions of clause (d) of
this Section are subject to the further qualification 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 the obligations on the part of the
Company contained in Section 6.3 of the Original Agreement (incorporated by
reference in Section 4.4 hereof) and Section 4.6 hereof, the Company shall not
be deemed in default 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 or of the State or
of any of their departments, agencies or officials, or of any civil or
military authority; insurrections; riots; epidemics; landslides; lightning;
earthquake; fire; hurricanes; storms; floods; washouts; droughts; arrests;
restraint of government and people; civil disturbances; explosions; breakage
or accident to machinery; 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 with all reasonable dispatch the cause or causes
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 the
total amount payable under clause (i) of the first sentence of the first
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paragraph of Section 3.1 of this Agreement, including the interest
thereon, 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 to the Trustee 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 Trustee, the paying agents, and the Remarketing
Agent and all other amounts required to be paid under the Indenture shall have
been paid, to the Company.
Section 5.3. Agreement to Pay Attorneys' Fees and Expenses. If the
Company should breach any of the provisions of 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. If 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 Trustee, any paying agents and the
Remarketing Agent and all other amounts payable by the Company under this
Agreement 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, if by mail to the Chairman of the
Board of Directors, at Town Hall, Columbia, Alabama 36319; if to the Trustee,
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to P. O. Box 2554, Birmingham, Alabama 35290, Attention: Corporate Trust
Department; if to the Company, to 600 North 18th Street, Birmingham, Alabama
35203, Attention: Treasurer; and if to the Remarketing Agent, to Merrill
Lynch, Pierce, Fenner & Smith Incorporated, World Financial Center - North
Tower, New York, New York 10281, Attention: Tax Exempt Money Markets
Department. 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.
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 invalidate or render unenforceable any
other provision hereof.
Section 6.5. Amounts Remaining Under the Indenture. Any amounts
remaining under the Indenture upon termination of this Agreement shall, to the
extent provided by Section 7.03 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 X
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 Alabama.
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.
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<PAGE>
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.
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
ATTEST:
Secretary
ALABAMA POWER COMPANY
By:
Vice President
ATTEST:
Secretary
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<PAGE>
STATE OF ALABAMA
COUNTY OF
I, , a Notary
Public in and for said county in said state, hereby certify that William D.
Lanford, Jr., whose name as Chairman of the Board of Directors of The
Industrial Development Board of the Town of Columbia, a public corporation and
instrumentality under the laws of the State of Alabama, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this
day that, being informed of the contents of the within instrument, he, as such
officer and with full authority executed the same voluntarily for and as the
act of said public corporation.
Given under my hand and official seal of office this _____ day of
October, 1995.
Notary Public
My Commission Expires:
[SEAL]
STATE OF ALABAMA
COUNTY OF
I, , a Notary
Public in and for said county in said state, hereby certify that
, whose name as _______________________ of
Alabama Power Company, a corporation organized and existing under the laws of
the State of Alabama, is signed to the foregoing instrument and who is known
to me, acknowledged before me on this day that, being informed of the contents
of the within instrument, he, as such officer and with full authority executed
the same voluntarily for and as the act of said corporation.
Given under my hand and official seal of office this ____ day of
October, 1995.
Notary Public
My Commission Expires:
[SEAL]
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Exhibit C
THE INDUSTRIAL DEVELOPMENT BOARD OF
THE TOWN OF COLUMBIA
and
ALABAMA POWER COMPANY
SIXTH SUPPLEMENTARY
INSTALLMENT SALE AGREEMENT
Dated as of October 1, 1995
Relating to
$26,500,000
Pollution Control Revenue Refunding Bonds, 1995 Series E
(Alabama Power Company Project)
<PAGE>
SIXTH SUPPLEMENTARY INSTALLMENT SALE AGREEMENT
TABLE OF CONTENTS
(This Table of Contents is for convenience of reference only and is not a
part of this Sixth Supplementary Installment Sale Agreement)
Page
Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I . . . . . . . . . . . . . . . 2
DEFINITIONS . . . . . . . . . . . . . . 2
ARTICLE II . . . . . . . . . . . . . . 4
RELATIONSHIP OF AGREEMENT TO THE ORIGINAL AGREEMENT;
ISSUANCE OF THE BONDS . . . . . . . . . . . . 4
Section 2.1. Relationship of Agreement to the Original
Agreement . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.2. Issuance of Bonds . . . . . . . . . . . . . . . . . . . 5
ARTICLE III . . . . . . . . . . . . . . 5
PROVISIONS FOR PAYMENT . . . . . . . . . . . 5
Section 3.1. Amounts Payable . . . . . . . . . . . . . . . . . . . . 5
Section 3.2. Obligation of the Company Unconditional . . . . . . . . 6
Section 3.3. Creation of Subordinated Security Interest . . . . . . 6
Section 3.4. Assignment and Pledge of Payments and Rights
Under this Agreement . . . . . . . . . . . . . . . . . 7
Section 3.5. Provision of Credit Agreement . . . . . . . . . . . . . 7
ARTICLE IV . . . . . . . . . . . . . . 7
SPECIAL COVENANTS . . . . . . . . . . . . . 7
Section 4.1. No Warranty of Suitability by the Issuer . . . . . . . 7
Section 4.2. Use of Project . . . . . . . . . . . . . . . . . . . . 7
Section 4.3. Indemnity Against Claims . . . . . . . . . . . . . . . 7
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<PAGE>
Section 4.4. Incorporation of Certain Provisions of the
Original Agreement . . . . . . . . . . . . . . . . . . 8
Section 4.5. Further Assurances and Corrective Instruments . . . . . 8
Section 4.6. Tax Covenants . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE V . . . . . . . . . . . . . . . 9
EVENTS OF DEFAULT AND REMEDIES . . . . . . . . . 9
Section 5.1. Events of Default . . . . . . . . . . . . . . . . . . . 9
Section 5.2. Remedies on Default . . . . . . . . . . . . . . . . . . 10
Section 5.3. Agreement to Pay Attorneys' Fees and Expenses . . . . . 11
Section 5.4. No Additional Waiver Implied by One Waiver . . . . . . 11
ARTICLE VI . . . . . . . . . . . . . . 11
MISCELLANEOUS . . . . . . . . . . . . . . 11
Section 6.1. Term of This Agreement . . . . . . . . . . . . . . . . 11
Section 6.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 6.3. Binding Effect . . . . . . . . . . . . . . . . . . . . 12
Section 6.4. Severability . . . . . . . . . . . . . . . . . . . . . 12
Section 6.5. Amounts Remaining Under the Indenture . . . . . . . . . 12
Section 6.6. Amendments . . . . . . . . . . . . . . . . . . . . . . 12
Section 6.7. Execution in Counterparts . . . . . . . . . . . . . . . 12
Section 6.8. Applicable Law . . . . . . . . . . . . . . . . . . . . 12
Section 6.9. Captions . . . . . . . . . . . . . . . . . . . . . . . 12
Section 6.10. Other Financing . . . . . . . . . . . . . . . . . . . . 12
-ii-
<PAGE>
SIXTH SUPPLEMENTARY INSTALLMENT SALE AGREEMENT dated as of October 1,
1995 between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF COLUMBIA, a
public corporation duly created and validly existing pursuant to the
constitution and laws of the State of Alabama (the "Issuer"), and ALABAMA
POWER COMPANY, a corporation organized and existing under the laws of the
State of Alabama (the "Company"), evidencing the agreement of the parties
hereto.
RECITALS
WHEREAS, the Issuer was organized pursuant to the provisions of Act No.
648 enacted at the 1949 Regular Session of the Legislature of Alabama, as
heretofore amended, and further supplemented by Act No. 1893 enacted at the
1971 Regular Session of the Legislature of Alabama and Act No. 510 enacted at
the 1982 Regular Session of the Legislature of Alabama (said Act No. 648, as
amended and supplemented being herein called the "Act"); and
WHEREAS, under the Act the Issuer has the following, among other,
powers:
(a) to acquire, whether by construction, purchase,
exchange, gift, lease, or otherwise, and to enlarge, improve,
replace, equip and maintain, one or more pollution control
facilities, including all real and personal property deemed
necessary or desirable in connection therewith,
(b) to issue its revenue bonds to pay the cost of
pollution control facilities payable solely from the revenues and
receipts derived from the leasing or sale by the Issuer of such
pollution control facilities,
(c) to lease or sell to others and otherwise dispose of
all or any portion of such pollution control facilities, and
(d) to issue its refunding bonds for the purpose of paying
the principal of, premium, if any, and interest on, its
outstanding revenue bonds; and
WHEREAS, in order to promote the health, safety and prosperity of the
citizens of the State of Alabama through the protection of its air and water
resources, the Issuer has previously undertaken to acquire, construct,
install, equip, and sell to the Company facilities, or portions thereof,
designed for the abatement or control of air and water pollution and sewage
treatment and disposal at the site of the Company's Farley Plant, located
within the geographical area of operation of the Issuer in Houston County,
Alabama, which facilities comprise the Project (hereinafter defined); and
WHEREAS, at the request of the Company, the Issuer has agreed to issue
$26,500,000 aggregate principal amount of its Pollution Control Revenue
Refunding Bonds, 1995 Series E (Alabama Power Company Project) and to apply
the proceeds from the sale thereof toward the redemption of certain of the
Issuer's pollution control revenue bonds previously issued to provide
financing for the Project;
<PAGE>
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter contained the receipt and sufficiency of which are
hereby acknowledged, the parties hereto formally covenant, agree, and bind
themselves as follows:
ARTICLE I
DEFINITIONS
The terms defined in the Indenture are used herein with the same
meanings given to such terms in the Indenture. In addition, the following
terms shall have the meanings set out below:
"Agreement" means this Sixth Supplementary Installment Sale Agreement
and any amendments and supplements hereto.
"Bonds" means the Pollution Control Revenue Refunding Bonds (Alabama
Power Company Project), 1995 Series E, issued by the issuer under the
Indenture in the aggregate principal amount of $26,500,000.
"Event of Default" means any of the occurrences enumerated in Section
5.1 of this Agreement.
"First Mortgage" means the Indenture dated as of June 1, 1942, as
heretofore and hereafter supplemented and amended, between the Company and
Chemical Bank, as Trustee, securing first mortgage bonds of the Company
heretofore or hereafter issued thereunder.
"Indenture" means the Indenture of Trust dated as of October 1, 1995,
relating to the Bonds, between the Issuer and SouthTrust Bank of Alabama,
National Association, as Trustee, pursuant to which the Bonds are authorized
to be issued, and including any indenture supplemental thereto.
"1995 Series C Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, 1995 Series C (Alabama Power Company Project), in the
aggregate principal amount of $28,000,000, issued concurrently with the Bonds.
"1995 Series D Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, 1995 Series D (Alabama Power Company Project) in the
aggregate principal amount of $27,000,000 issued concurrently with the Bonds.
"Original Agreement" means the Installment Sale Agreement dated as of
May 1, 1978 between the Issuer and the Company, as heretofore supplemented and
amended, excluding, however, the Supplementary Installment Sale Agreement
dated as of September 1, 1994, the Second Supplementary Installment Sale
Agreement dated as of May 1, 1995, the Third Supplementary Installment Sale
Agreement dated as of May 1, 1995, the Fourth Supplementary Installment Sale
Agreement dated as of October 1, 1995, the Fifth Supplementary Installment
Sale Agreement dated as of October 1, 1995 and this Agreement.
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<PAGE>
"Original Indenture" means the Trust Indenture dated as of May 1, 1978
by and between the Issuer and the Trustee, as supplemented and amended by a
First Supplemental Indenture dated as of November 1, 1984, a Second
Supplemental Indenture dated as of December 1, 1984, a Third Supplemental
Indenture dated as of June 1, 1985, a Fourth Supplemental Indenture dated as
of December 1, 1985, a Fifth Supplemental Indenture dated as of December 31,
1985, a Sixth Supplemental Indenture dated as of November 1, 1986 and a
Seventh Supplemental Indenture dated as of June 1, 1993.
"Project" means the air and water pollution control and solid waste
disposal facilities financed and refinanced from the proceeds of the Series E
Bonds as described in Exhibit A to the Original Agreement.
"Series A Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series A (Alabama Power Company Farley Plant Project), dated May 1, 1978, in
the original aggregate principal amount of $1,650,000.
"Series B Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series B (Alabama Power Company Farley Plant Project), dated November 1, 1984,
in the original aggregate principal amount of $100,000,000.
"Series C Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series C (Alabama Power Company Farley Plant Project), dated December 1, 1984,
in the original aggregate principal amount of $50,000,000.
"Series D Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series D (Alabama Power Company Farley Plant Project), dated June 1,
1985, in the original aggregate principal amount of $50,000,000, for the
purpose of refunding the Series C Bonds.
"Series E Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series E (Alabama Power Company Farley Plant Project), dated December 1, 1985,
issued in the original aggregate principal amount of $81,500,000.
"Series F Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series F (Alabama Power Company Farley Plant Project), dated December 31,
1985, issued in the original aggregate principal amount of $21,000,000.
"Series G Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series G (Alabama Power Company Farley Plant Project), dated November
1, 1986, issued in the original principal amount of $21,000,000, for the
purpose of refunding the Series F Bonds.
"Series H Bonds" means the Issuer's Pollution Control Revenue Bonds,
Series H (Alabama Power Company Farley Plant Solid Waste Project), dated June
1, 1993, issued in the original aggregate principal amount of $9,800,000.
"Series 1994 Bonds" means the Issuer's Pollution Control Revenue
Refunding Bonds, Series 1994 (Alabama Power Company Project), dated September
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1, 1994, issued in the original aggregate principal amount of $101,650,000,
for the purpose of refunding the Series A Bonds and the Series B Bonds.
"Subordinated Security Interest" means the security interest in the
Project created in Section 3.3 hereof.
ARTICLE II
RELATIONSHIP OF AGREEMENT TO THE ORIGINAL AGREEMENT;
ISSUANCE OF THE BONDS
Section 2.1. Relationship of Agreement to the Original Agreement.
The Original Agreement was initially executed and delivered by the Issuer and
the Company in connection with the issuance and sale of the Series A Bonds and
was supplemented and amended from time to time thereafter in connection with
the issuance and sale of the Series B, C, D, E, F, G and H Bonds. Under the
terms of the Original Agreement, the Issuer agreed to finance, acquire,
construct, install and equip the Project and to sell the Project to the
Company. The Company agreed, inter alia, to assist the Issuer in the
implementation of the Project and to purchase the Project for a purchase price
payable in installments due at such times and in such amounts as would provide
funds sufficient to pay the principal of, premium, if any, and interest on all
bonds issued under the Original Indenture when due, whether at stated maturity
upon redemption or acceleration, or otherwise. The Issuer and the Company
have heretofore arranged for the redemption of the Series A Bonds, the Series
B Bonds, the Series C Bonds, the Series F Bonds and the Series D Bonds and as
a result, the installment payments currently required of the Company under the
Original Agreement relate only to the Series E, G and H Bonds. Upon the
redemption of the Series E Bonds from proceeds of the Bonds, the 1995 Series C
Bonds and the 1995 Series D Bonds, the Company will no longer be obligated to
make installment payments under the Original Agreement with respect to the
Series E Bonds but will retain its obligations with respect to the Series G
and H Bonds. By their execution and delivery of this Agreement, which is
intended to be complementary to the Original Agreement, the Issuer and the
Company ratify and confirm the sale of the Project to the Company pursuant to
the Original Agreement, agree to continue the Original Agreement in full force
and effect except for the provisions thereof requiring the Company to make
purchase price payments related to bonds of the Issuer which have been fully
paid and redeemed, and agree that from and after the date of this Agreement
the Company will make additional purchase price payments in installments due
at such times and in such amounts as will provide funds sufficient to pay the
principal of, premium, if any, interest on, and purchase price of all Bonds
issued under the Indenture. The parties acknowledge and confirm that the
Issuer's agreement to issue the Bonds and to apply the proceeds thereof to the
redemption of the Series E Bonds (thereby reducing the Company's payment
obligations under the Original Agreement) constitutes fair and adequate
consideration for the additional obligations undertaken by the Company
pursuant to this Agreement. To the extent that any statement in, or provision
of, this Agreement conflicts with the Original Agreement, the provisions of
this Agreement shall be deemed to control.
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Section 2.2. Issuance of Bonds. In order to provide funds to
refund a portion of the Series E Bonds, the Issuer agrees that it will
initially issue and deliver the Bonds to the purchasers thereof at a price to
be approved in advance by the Company and will 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.
ARTICLE III
PROVISIONS FOR PAYMENT
Section 3.1. Amounts Payable. The Company agrees to pay to the
Trustee, as assignee of the Issuer, in funds which will be immediately
available on the day payment is due, from time to time as the amount owed
hereunder, including interest thereon (which interest obligation shall equal
the interest and premium, if any, on the Bonds), amounts which, and at or
before times which, shall correspond (i) to the payments in respect of the
principal of and 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 acceleration or otherwise, and (ii) the purchase price of the
Bonds required or permitted to be purchased under the Indenture. If (i) at
the date any payment on the Bonds is due, available moneys are held by the
Trustee under the Indenture which are not being held for the payment of Bonds
due and payable but which have not been presented for payment, or (ii) on any
date on which Bonds are to be purchased pursuant to Section 4.02 of the
Indenture, there are any available moneys held for the payment of the purchase
price which are not being held for the purchase of Bonds which have not been
presented for purchase pursuant to Section 6 of the form of Bonds, then, in
each case, such moneys shall be credited against the payment then due
hereunder, first in respect of interest on the amount then due and owing
hereunder and then, to the extent of remaining moneys, in respect of principal
on the amount then due and owing hereunder.
The Company will also pay: (i) the fees, charges and reasonable
expenses of the Trustee, any paying agents and the Remarketing Agent under the
Indenture, such fees, charges, and reasonable expenses to be paid directly to
the Trustee, paying agents and Remarketing Agent for their respective accounts
as and when such fees, charges and reasonable expenses become due and payable,
(ii) any expenses and costs incurred or to be incurred by virtue of the
issuance of the Bonds, (iii) any expenses in connection with any redemption of
the Bonds, and (iv) any expenses in connection with the redemption of the
Series E Bonds.
The Company also agrees that, on or before the date of redemption of the
Series E Bonds, it will pay to the Series E Trustee for deposit into the Bond
Fund held by the Series E Trustee in connection with the Series E Bonds, an
amount of funds which, when added to the proceeds of the Bonds (other than
proceeds, if any, representing accrued interest), the proceeds of the 1995
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Series C Bonds and the proceeds of the 1995 Series D Bonds deposited in such
Bond Fund, plus any investment earnings thereon, and any other funds available
for such purpose, will be sufficient to permit the Series E Trustee to pay the
principal of, premium and accrued interest on the Series E Bonds upon their
redemption, which shall be on or before December 31, 1995.
Section 3.2. Obligation of the Company Unconditional. The
obligation of the Company to make the payments as provided in this Agreement
and to perform and observe the other agreements on its part contained herein
shall be absolute and unconditional notwithstanding failure of the Issuer's
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 Alabama 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 3.2
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 any
diminution of the amounts payable under Section 3.1 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 of the Project
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 3.3. Creation of Subordinated Security Interest. As
security for the performance by the Company of its obligations under Section
3.1 hereof, the Company hereby grants to the Issuer a security interest in the
Project and in each component thereof which has been or will be acquired
hereunder by the Company from the Issuer. It is agreed that the security
interest hereby granted is hereby made, and shall at all times be, subject to
the lien of the First Mortgage and to the lien created pursuant to the
Original Agreement. The rights of the trustee and bondholders thereunder,
shall be equal in rank to, but not superior to, any future liens created for
the benefit of any indebtedness of the Company hereafter issued under an
indenture providing that any lien for the benefit of such indebtedness shall
be equal in rank to the security interest hereby granted. Such security
interest shall remain in effect until the Company shall have satisfied its
obligations under Section 3.1 hereof at which time the Issuer shall cause the
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execution and delivery to the Company of such documents as shall be necessary
to effect or evidence the termination of such security interest.
Section 3.4. Assignment and Pledge of Payments and Rights Under
this 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
this Agreement, including the Subordinated Security Interest, and all moneys
receivable hereunder (except for payments under the second and third
paragraphs of Section 3.1 and 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.
Section 3.5. Provision of Credit Agreements. On or before the date
of initial issuance of the Bonds, the Company shall enter into the Credit
Agreements for the purpose of providing the Company with a committed source of
funds, if needed, with which to perform its obligations under Section 3.1
hereof to provide any funds necessary to purchase Bonds which have been
tendered for purchase but not remarketed. The Company shall be under no
obligation to maintain the Credit Agreements in place during the term of the
Bonds, except that the Company shall not voluntarily terminate the Credit
Agreements at any time during which the Bonds are in a Commercial Paper
Period. In addition, the Company hereby agrees to notify the Trustee and the
Remarketing Agent in writing at least 20 Business Days prior to any
termination of either or both of the Credit Agreements at the request of the
Company.
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 hereby covenants and
agrees that it will not take any action, other than pursuant to the exercise
of its rights under Section 5.2 of this Agreement and under the corresponding
provisions of the Original 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, cooperate with
the Company in order that the Company may have possession and enjoyment of the
Project.
Section 4.3. Indemnity Against Claims. The Company will pay and
discharge and will indemnify and hold harmless the Issuer from (a) any lien or
charge upon payments by the Company hereunder, (b) any taxes, assessments,
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impositions, and other charges upon payments by the Company to the Issuer
hereunder, and (c) any and all liabilities, damages, costs, and expenses
arising out of or resulting from the transactions contemplated by this
Agreement and the Indenture, 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 will give prompt 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. Incorporation of Certain Provisions of the Original
Agreement. The provisions of the following sections of the Original Agreement
are incorporated herein by reference with the effect that the terms of such
sections shall apply with the same force and effect as if set out in full
herein: Section 6.2 (relating to inspection of the Project); Section 6.3
(relating to maintenance of the Company's corporate existence); Section 6.4
(relating to the provision of certain financial statements); Section 5.1
(relating to maintenance of the Project); Section 5.2 (relating to removal of
portions of the Project); Section 5.3 (relating to the payment of taxes and
other governmental charges); Section 5.4 (relating to insurance); Section 5.5
(relating to eminent domain); and Section 7.1 (relating to the Company's right
to assign its interest in the Original Agreement and to lease the Project).
The provisions so incorporated shall remain in force throughout the term of
this Agreement notwithstanding any earlier termination of the Original
Agreement.
Section 4.5. 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.
The Issuer will, upon the request and at the expense of the Company,
cause the execution and delivery from time to time to the Company of such
further instruments of conveyance as are deemed by the Company to be necessary
to effect or evidence the conveyance to the Company of good and marketable
title to the Project or any portion thereof, subject to no lien other than any
Permitted Encumbrances (as defined in the Original Agreement).
Section 4.6. Tax Covenants. The Company and the Issuer covenant
and agree that they 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" 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
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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. Without limiting the generality
of the foregoing, the Company covenants and agrees to comply with the
requirements of Sections 148(d) and 148(f) of the Code and any proposed,
temporary, or final regulations thereunder as may be applicable to the Bonds
or the proceeds derived from the sale of the Bonds or any other moneys. The
Company acknowledges Section 6.03 of the Indenture and agrees to perform all
duties imposed upon it by such Section. Insofar as said Section imposes
duties and responsibilities on the Company, it is specifically incorporated
herein by reference.
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 or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
interest due or becoming due on any of the Bonds for a period of five
days after the same shall become due and payable.
(b) Failure by the Company to pay or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
principal of, or premium, if any, on any of the Bonds when the same
shall become due and payable.
(c) Failure by the Company to pay or cause to be paid that
portion of the amounts payable hereunder which is attributable to the
purchase price on any of the Bonds after the same shall become due and
payable.
(d) Failure by the Company to observe and perform any covenant,
condition, or agreement in this Agreement on its part to be observed or
performed, other than as referred to in subsections (a), (b), and (c) of
this Section, for a period of 90 days after written notice, specifying
such failure and requesting that it be remedied, is given to the Company
by the Issuer or the Trustee.
` (e) The dissolution or liquidation of the Company, except as
permitted by Section 4.4 hereof, or the commencement by the Company of
any case or proceeding seeking to have an order for relief entered on
its behalf as a debtor or to adjudicate it as bankrupt or insolvent or
seeking reorganization, liquidation, dissolution, winding-up,
arrangement, composition, readjustment of its debts or any other relief
under any bankruptcy, insolvency, reorganization or other similar law of
the United States or any state, or adjudication of the Company as
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bankrupt, or an assignment by the Company for the benefit of its
creditors, or the entry by the Company into an agreement of composition
with its creditors, or the approval by a court of competent jurisdiction
of a petition applicable to the Company in any proceeding for its
reorganization instituted under the provisions of Title 11 of the United
States Code, as amended, or under any similar statutory provision which
may hereafter be enacted.
(f) An "event of default" as defined in Section 8.01 of the
Indenture shall have occurred and be continuing.
A default under clause (d) of this Section is not an Event of Default until
the Trustee or the holders of at least 25% in principal amount of the Bonds
then outstanding give the Issuer and the Company a notice specifying the
default, demanding that it be remedied and stating that the notice is a
"Notice of Default" and the Company does not cure the default within 90 days
after receipt of the notice, or within such longer period as the Trustee shall
agree to. The Trustee shall not unreasonably refuse to agree to a longer
period if the default cannot reasonably be cured within 90 days after receipt
of the notice and the Company has begun within 90 days and continued diligent
efforts to correct the default. The foregoing provisions of clause (d) of
this Section are subject to the further qualification 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 the obligations on the part of the
Company contained in Section 6.3 of the Original Agreement (incorporated by
reference in Section 4.4 hereof) and Section 4.6 hereof, the Company shall not
be deemed in default 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 or of the State or
of any of their departments, agencies or officials, or of any civil or
military authority; insurrections; riots; epidemics; landslides; lightning;
earthquake; fire; hurricanes; storms; floods; washouts; droughts; arrests;
restraint of government and people; civil disturbances; explosions; breakage
or accident to machinery; 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 with all reasonable dispatch the cause or causes
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:
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(a) By written notice to the Company, the Issuer may declare the
total amount payable under clause (i) of the first sentence of the first
paragraph of Section 3.1 of this Agreement, including the interest
thereon, 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 to the Trustee 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 Trustee, the paying agents, and the Remarketing
Agent and all other amounts required to be paid under the Indenture shall have
been paid, to the Company.
Section 5.3. Agreement to Pay Attorneys' Fees and Expenses. If the
Company should breach any of the provisions of 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. If 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 Trustee, any paying agents and the
Remarketing Agent and all other amounts payable by the Company under this
Agreement 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,
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addressed as follows: if to the Issuer, if by mail to the Chairman of the
Board of Directors, at Town Hall, Columbia, Alabama 36319; if to the Trustee,
to P. O. Box 2554, Birmingham, Alabama 35290, Attention: Corporate Trust
Department; if to the Company, to 600 North 18th Street, Birmingham, Alabama
35203, Attention: Treasurer; and if to the Remarketing Agent, to Morgan
Stanley & Co. Incorporated, 1221 Avenue of the Americas, New York, New York
10020, Attention: Janet Salem. 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.
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 invalidate or render unenforceable any
other provision hereof.
Section 6.5. Amounts Remaining Under the Indenture. Any amounts
remaining under the Indenture upon termination of this Agreement shall, to the
extent provided by Section 7.03 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 X
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 Alabama.
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.
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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.
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
ATTEST:
Secretary
ALABAMA POWER COMPANY
By:
Vice President
ATTEST:
Secretary
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STATE OF ALABAMA
COUNTY OF
I, , a Notary
Public in and for said county in said state, hereby certify that William D.
Lanford, Jr., whose name as Chairman of the Board of Directors of The
Industrial Development Board of the Town of Columbia, a public corporation and
instrumentality under the laws of the State of Alabama, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this
day that, being informed of the contents of the within instrument, he, as such
officer and with full authority executed the same voluntarily for and as the
act of said public corporation.
Given under my hand and official seal of office this _____ day of
October, 1995.
Notary Public
My Commission Expires:
[SEAL]
STATE OF ALABAMA
COUNTY OF
I, , a Notary
Public in and for said county in said state, hereby certify that
, whose name as _______________________ of
Alabama Power Company, a corporation organized and existing under the laws of
the State of Alabama, is signed to the foregoing instrument and who is known
to me, acknowledged before me on this day that, being informed of the contents
of the within instrument, he, as such officer and with full authority executed
the same voluntarily for and as the act of said corporation.
Given under my hand and official seal of office this ____ day of
October, 1995.
Notary Public
My Commission Expires:
[SEAL]
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Exhibit D
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
to
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION,
as Trustee
INDENTURE OF TRUST
Dated as of October 1, 1995
Relating to
$28,000,000
Pollution Control Revenue Refunding Bonds, 1995 Series C
(Alabama Power Company Project)
<PAGE>
TABLE OF CONTENTS
GRANTING CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION . . . . . . . 4
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . 4
Section 1.02. Rules of Construction . . . . . . . . . . . . . . 8
ARTICLE II
THE BONDS . . . . . . . . . . . . . . 8
Section 2.02. Interest on the Bonds . . . . . . . . . . . . . . 9
Section 2.03. Execution and Authentication . . . . . . . . . . 15
Section 2.04. Bond Register . . . . . . . . . . . . . . . . . . 16
Section 2.05. Registration and Exchange of Bonds; Persons
Treated as Owners . . . . . . . . . . . . . . . . . . . 16
Section 2.06. Mutilated, Lost, Stolen, Destroyed or Undeliv-
ered Bonds . . . . . . . . . . . . . . . . . . . . . . . 17
Section 2.07. Cancellation of Bonds . . . . . . . . . . . . . . 17
Section 2.08. Temporary Bonds . . . . . . . . . . . . . . . . . 17
ARTICLE III
REDEMPTION, PURCHASES IN LIEU OF REDEMPTION AND REMARKETING . . 18
Section 3.01. Notices to Trustee . . . . . . . . . . . . . . . 18
Section 3.02. Redemption Dates . . . . . . . . . . . . . . . . 18
Section 3.03. Selection of Bonds to Be Redeemed . . . . . . . . 18
Section 3.04. Redemption Notices . . . . . . . . . . . . . . . 18
Section 3.05. Payment of Bonds Called for Redemption . . . . . 20
Section 3.06. Bonds Redeemed in Part . . . . . . . . . . . . . 20
Section 3.07. Purchase of Bonds in Lieu of Redemption . . . . . 20
Section 3.08. Disposition of Purchased Bonds . . . . . . . . . 20
ARTICLE IV
APPLICATION OF PROCEEDS AND PAYMENT OF BONDS . . . . . 22
Section 4.01. Application of Proceeds . . . . . . . . . . . . . 22
Section 4.02. Payments of Bonds . . . . . . . . . . . . . . . . 22
Section 4.03. Investments of Moneys . . . . . . . . . . . . . . 23
Section 4.04. Moneys Held in Trust . . . . . . . . . . . . . . 23
ARTICLE V
BOOK-ENTRY SYSTEM . . . . . . . . . . . . 24
Section 5.01. Book-Entry System . . . . . . . . . . . . . . . . 24
ARTICLE VI
COVENANTS . . . . . . . . . . . . . . 25
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Section 6.01. Payment of Bonds . . . . . . . . . . . . . . . . 25
Section 6.02. Recording and Filing; Further Assurances . . . . 25
Section 6.03. Tax Covenants . . . . . . . . . . . . . . . . . . 26
Section 6.04. Termination of Subordinated Security Interest . . 26
ARTICLE VII
DISCHARGE OF INDENTURE . . . . . . . . . . . 27
Section 7.01. Bonds Deemed Paid; Discharge of Indenture . . . . 27
Section 7.02. Application of Trust Money . . . . . . . . . . . 28
Section 7.03. Repayment to Company . . . . . . . . . . . . . . 28
ARTICLE VIII
DEFAULTS AND REMEDIES . . . . . . . . . . . 28
Section 8.01. Events of Default . . . . . . . . . . . . . . . . 28
Section 8.02. Acceleration . . . . . . . . . . . . . . . . . . 28
Section 8.03. Other Remedies . . . . . . . . . . . . . . . . . 28
Section 8.04. Waiver of Past Defaults . . . . . . . . . . . . . 29
Section 8.05. Control by Majority . . . . . . . . . . . . . . . 29
Section 8.06. Limitation on Suits . . . . . . . . . . . . . . . 29
Section 8.07. Rights of Holders to Receive Payment . . . . . . 29
Section 8.08. Collection Suit by Trustee . . . . . . . . . . . 30
Section 8.09. Trustee May File Proofs of Claim . . . . . . . . 30
Section 8.10. Priorities . . . . . . . . . . . . . . . . . . . 30
Section 8.11. Undertaking for Costs . . . . . . . . . . . . . . 30
ARTICLE IX
TRUSTEE AND REMARKETING AGENT . . . . . . . . . 31
Section 9.01. Duties of Trustee . . . . . . . . . . . . . . . . 31
Section 9.02. Rights of Trustee . . . . . . . . . . . . . . . . 32
Section 9.03. Individual Rights of Trustee . . . . . . . . . . 32
Section 9.04. Trustee's Disclaimer . . . . . . . . . . . . . . 32
Section 9.05. Notice of Defaults . . . . . . . . . . . . . . . 32
Section 9.06. Compensation and Indemnity of Trustee . . . . . . 32
Section 9.07. Eligibility of Trustee . . . . . . . . . . . . . 33
Section 9.08. Replacement of Trustee . . . . . . . . . . . . . 33
Section 9.09. Acceptance of Trust by Successor Trustee . . . . 34
Section 9.10. [reserved] . . . . . . . . . . . . . . . . . . . 35
Section 9.11. Duties of Remarketing Agent . . . . . . . . . . . 35
Section 9.12. Eligibility of Remarketing Agent . . . . . . . . 35
Section 9.13. Replacement of Remarketing Agent . . . . . . . . 35
Section 9.14. Compensation of Remarketing Agent . . . . . . . . 36
Section 9.15. Successor Trustee or Remarketing Agent by
Merger . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE X
AMENDMENTS OF AND SUPPLEMENTS TO INDENTURE . . . . . . 36
Section 10.01. Without Consent of Bondholders . . . . . . . . . 36
Section 10.02. With Consent of Bondholders . . . . . . . . . . . 37
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Section 10.03. Effect of Consents . . . . . . . . . . . . . . . 37
Section 10.04. Notation on or Exchange of Bonds . . . . . . . . 37
Section 10.05. Signing by Trustee of Amendments and
Supplements . . . . . . . . . . . . . . . . . . . . . . 37
Section 10.06. Company Consent Required . . . . . . . . . . . . 38
Section 10.07. Notice to Bondholders . . . . . . . . . . . . . . 38
ARTICLE XI
AMENDMENTS OF AND SUPPLEMENTS TO THE AGREEMENT . . . . . 38
Section 11.01. Without Consent of Bondholders . . . . . . . . . 38
Section 11.02. With Consent of Bondholders . . . . . . . . . . . 38
Section 11.03. Consents by Trustee to Amendments or
Supplements . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE XII
[reserved] . . . . . . . . . . . . . . 39
ARTICLE XIII
MISCELLANEOUS . . . . . . . . . . . . . 39
Section 13.01. Notices . . . . . . . . . . . . . . . . . . . . . 39
Section 13.02. Bondholders' Consents . . . . . . . . . . . . . . 39
Section 13.03. Appointment of Separate Paying Agent and/or
Tender Agent . . . . . . . . . . . . . . . . . . . . . . 40
Section 13.04. Limitation of Rights . . . . . . . . . . . . . . 40
Section 13.05. Severability . . . . . . . . . . . . . . . . . . 40
Section 13.06. Payments Due on Non-Business Days . . . . . . . . 40
Section 13.07. Governing Law . . . . . . . . . . . . . . . . . . 40
Section 13.08. Captions . . . . . . . . . . . . . . . . . . . . 40
Section 13.09. No Recourse Against Issuer's Officers . . . . . . 40
Section 13.10. Limitation of Liability . . . . . . . . . . . . . 41
Section 13.11. Counterparts . . . . . . . . . . . . . . . . . . 41
EXHIBIT A . . . . . . . . . . . . . . . . . . . . . . . . . . Form of Bond
iii
<PAGE>
INDENTURE OF TRUST
THIS INDENTURE OF TRUST made and entered into as of October 1, 1995, by
and between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF COLUMBIA, a public
corporation organized and existing under the laws of the State of Alabama (the
"Issuer"), and SOUTHTRUST BANK OF ALABAMA, NATIONAL ASSOCIATION, a national
banking association 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");
W I T N E S S E T H:
WHEREAS, under Act No. 648 enacted at the 1949 Regular Session of the
Alabama Legislature, as heretofore amended and supplemented by Act No. 1893
enacted at the 1971 Regular Session of the Alabama Legislature and Act No. 510
enacted at the 1982 Regular Session of the Alabama Legislature (Act No. 648,
as amended and supplemented, being herein called the "Act") the Issuer has the
following, among other powers:
(a) to acquire, whether by construction, purchase, exchange,
gift, lease or otherwise, and to enlarge, improve, replace, equip and
maintain, one or more pollution control facilities, including all real
and personal property deemed necessary or desirable in connection
therewith,
(b) to issue its revenue bonds to pay the cost of pollution
control facilities, such bonds to be payable solely from the revenues
and receipts derived from the leasing or sale by the Issuer of such
pollution control facilities,
(c) to lease or sell to others and otherwise dispose of all or
any portion of such pollution control facilities, and
(d) to issue its refunding bonds for the purpose of paying the
principal of, premium, if any, and accrued interest on, its outstanding
revenue bonds;
WHEREAS, in order to promote the health, safety and prosperity of the
citizens of the State of Alabama through the protection of its air and water
resources, the Issuer has undertaken to acquire, construct, install, equip and
sell to Alabama Power Company (the "Company") facilities or portions thereof,
designed for the abatement or control of air and water pollution, and the
disposal of sewage and solid wastes at the Company's Joseph M. Farley Nuclear
Plant, which is located within the geographical area of operation of the
Issuer in Houston County, Alabama, which facilities comprise the Project and
are generally described in Exhibit A to the Original Agreement described
below, and in furtherance of the above-mentioned purposes, the Issuer entered
into an Installment Sale Agreement dated as of May 1, 1978 (the "Initial
Agreement"), a First Supplemental Agreement thereto dated as of November 1,
1984, a Second Supplemental Agreement thereto dated as of December 1, 1984, a
Third Supplemental Agreement dated as of June 1, 1985, a Fourth Supplemental
Agreement dated as of December 1, 1985, a Fifth Supplemental Agreement dated
as of December 31, 1985, a Sixth Supplemental Agreement dated as of November
1, 1986 and a Seventh Supplemental Agreement dated as of June 1, 1993 (the
<PAGE>
Initial Agreement, as so supplemented, being hereinafter called the "Original
Agreement"), a Supplementary Installment Sale Agreement dated as of September
1, 1994 (the "First Supplementary Agreement"), a Second Supplementary
Agreement dated as of May 1, 1995 (the "Second Supplementary Agreement"), and
a Third Supplementary Agreement dated as of May 1, 1995 (the "Third
Supplementary Agreement"), with the Company providing for the undertaking by
the Issuer to acquire, construct, install, equip and sell to the Company the
Project;
WHEREAS, the Original Agreement provided that, in order to finance the
Project, the Issuer would issue and sell its Pollution Control Revenue Bonds
(Alabama Power Company Farley Plant Project) in one or more series and that
the Issuer would sell the Project (including improvements with respect to the
Project) to the Company for the purchase price stated in the Original
Agreement;
WHEREAS, in order to finance and refinance a portion of the costs of the
Project, the Issuer has heretofore issued various series of its revenue bonds
including $81,500,000 aggregate principal amount of its Pollution Control
Revenue Refunding Bonds, Series E (Alabama Power Company Farley Plant Project)
(the "Series E Bonds");
WHEREAS, the Issuer and the Company have entered into a Fourth
Supplementary Installment Sale Agreement dated of October 1, 1995 (the "Fourth
Supplementary Agreement") providing that for the purposes therein set forth,
the Issuer will issue and sell its Pollution Control Revenue Refunding Bonds,
1995 Series C (Alabama Power Company Project);
WHEREAS, pursuant to and in accordance with the provisions of the Act,
the Issuer now intends to issue its Pollution Control Revenue Refunding Bonds,
1995 Series C (Alabama Power Company Project) in the aggregate principal
amount of $28,000,000 (the "Bonds") for the purpose of refunding a portion of
the Series E Bonds;
WHEREAS, the execution and delivery of this Indenture of Trust (the
"Indenture"), and the issuance of the Bonds under the Act as herein provided
have been in all respects duly and validly authorized by proceedings duly
passed on and approved by the Issuer;
WHEREAS, all other acts, conditions and things required by the
Constitution and laws of the State of Alabama 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;
WHEREAS, the Company has agreed to make installment purchase payments to
the Issuer pursuant to the Agreement in amounts sufficient to pay the
principal, purchase price, premium, if any, and interest on the Bonds, all as
hereinafter defined;
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Accordingly, the Issuer and the Trustee agree as follows for the benefit
of each other and for the benefit of the holders of the Bonds issued pursuant
to this Indenture.
GRANTING CLAUSE
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 premiums, if any, thereon and the Purchase Price (hereinafter
defined) therefor 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, 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,
including the Subordinated Security Interest provided for in the Agreement,
and all moneys receivable thereunder, except for the Unassigned Rights, and
all funds held by the Trustee hereunder (other than moneys held for the
purchase of Bonds which have not been presented for payment) as security for
the payment of the Bonds and the fees, charges and expenses of the Trustee as
aforesaid and the satisfaction of any other obligation assumed by the Issuer
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 and purchase price of, 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 perform all the covenants and
conditions required of it by this Indenture, and shall pay or cause to be paid
to the Trustee, any additional paying agents and the Remarketing Agent all
sums of money due or to become due to them in accordance with the terms and
provisions hereof, then upon such final payments 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
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<PAGE>
may be reasonably required by the Issuer; 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 AND RULES OF CONSTRUCTION
Section 1.01. Definitions. For all purposes of this Indenture,
unless the context requires otherwise, the following terms shall have the
following meanings:
"Act" means Act No. 648 enacted at the 1949 Regular Session of the
Alabama Legislature, as amended from time to time, and presently codified as
Chapter 54 of Title 11 of the Code of Alabama 1975.
"Agreement" means the Fourth Supplementary Installment Sale Agreement
dated as of October 1, 1995, between the Issuer and the Company, as amended
and supplemented from time to time.
"Beneficial Owner" means the purchaser of a beneficial interest in the
Bonds when the Bonds are held by the Securities Depository in the Book-Entry
System, and otherwise means a Bondholder.
"Bondholder" or "holder" means the registered owner of any Bond.
"Bonds" means the Pollution Control Revenue Refunding Bonds, 1995 Series
C (Alabama Power Company Project) issued by the Issuer hereunder in the
aggregate principal amount of $28,000,000.
"Book-Entry System" means the system maintained by the Securities
Depository described in Section 5.01.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii) a
day on which commercial banks in New York, New York, or the city in which the
principal corporate trust office of the Trustee is located, are authorized by
law to close or (iii) a day on which the New York Stock Exchange is closed.
"Code" means the Internal Revenue Code of 1986, as amended, and the
Treasury regulations thereunder.
"Commercial Paper Mode" means each period of time, comprised of
Commercial Paper Periods, during which Commercial Paper Rates are in effect.
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<PAGE>
"Commercial Paper Period" means, with respect to any Bond, each period
set under Section 2.02(a)(3).
"Commercial Paper Rate" means the interest rate on each Bond set under
Section 2.02(a)(3).
"Company" means Alabama Power Company, an Alabama corporation, and its
successors and assigns, and any surviving, resulting or transferee entity as
provided in Section 6.3 of the Agreement.
"Company Representative" means any person at the time designated as such
pursuant to the provisions of Section 6.7 of the Original Agreement by a
written certificate furnished to the Trustee and the Issuer containing the
specimen signature of such person and signed on behalf of the Company by any
of its officers. The certificate may designate an alternate or alternates.
"Credit Agreement" means the Committed Line of Credit Agreement dated
October 3, 1995, between the Company and PNC Bank, N.A., arranged by the
Company pursuant to the provisions of Section 3.5 of the Agreement, or any
line of credit or similar facility or facilities that the Company may enter
into in substitution or replacement of such Committed Line of Credit Agreement
from time to time.
"Daily Rate" means an interest rate on the Bonds set under
Section 2.02(a)(l).
"Event of Default" is defined in Section 8.01.
"Favorable Opinion of Tax Counsel" means an Opinion of Tax Counsel
addressed to the Issuer and to the Trustee to the effect that the action
proposed to be taken is permitted by the laws of the State and by this
Indenture and will not adversely affect any exclusion from gross income for
federal income tax purposes of interest on the Bonds.
"Government Obligations" means (i) noncallable direct obligations of the
United States for which its full faith and credit are pledged,
(ii) noncallable obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States, the timely
payment of which is unconditionally guaranteed as a full faith and credit
obligation of the United States, or (iii) securities or receipts evidencing
ownership interests in obligations or specified portions (such as principal or
interest) of obligations described in (i) or (ii).
"Indenture" means this Indenture of Trust, as it may be amended or
supplemented from time to time in accordance with its terms.
"Interest Payment Date" is defined in the form of the Bonds appearing in
Exhibit A hereto.
"Interest Period" is defined in the form of the Bonds appearing in
Exhibit A hereto.
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"J.J. Kenny Index" means, as of any date, the index of 7-day yields on
high grade tax exempt municipal bonds as determined by J.J. Kenny Co., Inc. or
any successor thereto and published on such date (or, if not published on said
date, on the most recent day prior thereto on which such index shall have been
so published).
"Long-Term Interest Rate" means an interest rate on the Bonds set under
Section 2.02(a)(4).
"Long-Term Interest Rate Period" is defined in Section 2.02(a)(4).
"Maturity Date" means the stated maturity for the Bonds as set forth in
Section 2.01.
"1954 Code" means the Internal Revenue Code of 1954, as amended, and the
Treasury regulations thereunder.
"Opinion of Counsel" means a written opinion of counsel who is
acceptable to the Issuer and the Trustee. The counsel may be an employee of
or counsel to the Issuer, the Trustee or the Company.
"Opinion of Tax Counsel" means an Opinion of Counsel by counsel of
nationally recognized standing in matters relating to the exclusion of
interest from gross income on obligations issued by states and their political
subdivisions or agencies.
The term "outstanding" when used with reference to Bonds, or "Bonds
outstanding" means all Bonds which have been authenticated and delivered by
the Trustee under this Indenture, except the following:
a. Bonds canceled or purchased by or delivered to the Trustee
for cancellation.
b. Bonds that have become due (at maturity or on redemption,
acceleration or otherwise) and for the payment, including interest
accrued to the due date, of which sufficient moneys are held by the
Trustee.
c. Bonds deemed paid by Section 7.01.
d. Bonds in lieu of which others have been authenticated under
Section 2.05 (relating to registration and exchange of Bonds) or
Section 2.06 (relating to mutilated, lost, stolen, destroyed or
undelivered Bonds).
Bonds purchased by the Trustee or the Company pursuant to tenders or in lieu
of redemption under Article III will continue to be outstanding until the
Company directs the Trustee to cancel them. Bonds purchased pursuant to
tenders or in lieu of redemption and not delivered to the Trustee for payment
are not outstanding, but there will be outstanding Bonds authenticated and
delivered in lieu of such undelivered Bonds as provided in the second
paragraph of Section 2.06.
6
<PAGE>
"Participant" means one of the entities which deposit securities,
directly or indirectly, in the Book-Entry System.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, estate, unincorporated organization
or government or any agency or political subdivision thereof.
"Plant" means the Company's Farley Nuclear Plant located near the Town
of Columbia, Alabama.
The term "principal," when used with reference to any Bonds, includes
any premium payable on those Bonds.
The term "principal corporate trust office", when used with respect to
the Trustee, means the corporate trust office of the Trustee located at 100
Office Park Drive, Birmingham, Alabama 35223.
"Prior Indenture" means the Trust Indenture dated as of May 1, 1978, as
supplemented and amended, under which the Series E Bonds were issued.
"Project" means the air and water pollution control and sewage and solid
waste disposal facilities refinanced from the proceeds of the Series D Bonds,
all as described in Exhibit A to the Original Agreement.
"Purchase Price" means an amount equal to 100% of the principal amount
of any Bond tendered or deemed tendered pursuant to the provisions of
paragraph 6 in the form of the Bonds appearing as Exhibit A hereto, plus
accrued and unpaid interest thereon to the date of purchase.
"Record Date" is defined in the form of the Bonds appearing as Exhibit A
hereto.
"Remarketing Agent" means Lehman Brothers Inc. and its successors under
this Indenture.
"Responsible Officer" means any officer or trust officer of the Trustee
assigned by the Trustee to administer its corporate trust matters.
"Securities Depository" means The Depository Trust Company, New York,
New York or its nominee, and its successors and assigns, or any successor
appointed under Section 5.01.
"Series E Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series E (Alabama Power Company Farley Plant Project) issued and
outstanding in the aggregate principal amount of $81,500,000.
"Series E Trustee" means SouthTrust Bank of Alabama, National
Association, in its capacity as Trustee for the Series E Bonds.
"State" means the State of Alabama.
7
<PAGE>
"Tax Agreement" means the Tax and Non-Arbitrage Certificate of the
Company dated the date of issuance of the Bonds.
"Trustee" means the entity identified as such in the heading of this
Indenture and its successors under this Indenture.
"Unassigned Rights" means the rights of the Issuer under the second and
third paragraphs of Section 3.1 (relating to fees and expenses and amounts
payable to redeem the Series E Bonds), Section 4.3 (relating to
indemnification) and Section 5.3 (relating to expenses of collection) of the
Agreement.
"Weekly Rate" means an interest rate on the Bonds set under
Section 2.02(a)(2).
Section 1.02. Rules of Construction. Unless the context otherwise
requires,
a. an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles,
b. references to Articles and Sections are to the Articles and
Sections of this Indenture, and
c. the singular form of any word, including the terms defined
in Section 1.01, includes the plural, and vice versa, and any reference
to the male gender includes the female gender.
ARTICLE II
THE BONDS
Section 2.01. Issuance of Bonds: Form; Dating. The Bonds shall be
designated "The Industrial Development Board of the Town of Columbia,
Pollution Control Revenue Refunding Bonds, 1995 Series C (Alabama Power
Company Project)." The total principal amount of Bonds that may be
outstanding shall not exceed $28,000,000. The Bonds shall be substantially in
the form of Exhibit A, which is part of this Indenture, in the denominations
provided for in the Bonds. The Bonds may have notations, legends or
endorsements required by law or usage.
All Bonds will be dated the date of original issuance and delivery and
shall mature, subject to prior redemption, on October 1, 2022.
Bonds issued in exchange for Bonds surrendered for transfer or exchange
or in place of mutilated, lost, stolen, destroyed or undelivered Bonds will
bear interest from the last date to which interest has been paid on the Bonds
being transferred, exchanged or replaced or, if no interest has been paid, as
of the date of their original issuance and delivery. Bonds will be numbered as
determined by the Trustee.
Upon the execution and delivery of this Indenture, the Issuer will
execute and deliver to the Trustee and the Trustee will authenticate the Bonds
and deliver them to the purchaser or purchasers as directed by the Issuer.
8
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Section 2.02. Interest on the Bonds. Interest on the Bonds will be
payable as provided in the Bonds and in this Section. Interest on the Bonds
will initially be payable at the Daily Rate. The interest rate determination
method may be changed by the Company as described in paragraph (b) below. The
methods of determining the various interest rates are as provided in the
following paragraph (a).
(a) Interest Rate Determination Methods. While there exists an Event
of Default under the Indenture, the interest rate on the Bonds will be the
rate on the Bonds on the day before the Event of Default occurred, except that
if interest on any Bond was then payable at a Commercial Paper Rate, the
interest rate for all Bonds then bearing interest at a Commercial Paper Rate
will be the highest Commercial Paper Rate then in effect for any Bond.
(1) Daily Rate. When interest on the Bonds is payable at a
Daily Rate, the Remarketing Agent will set a Daily Rate on or before
11:00 a.m., New York City time, on each Business Day for that Business
Day. Each Daily Rate will be the minimum rate necessary (as determined
by the Remarketing Agent based on the examination of tax-exempt
obligations comparable to the Bonds known by the Remarketing Agent to
have been priced or traded under then-prevailing market conditions) for
the Remarketing Agent to sell the Bonds on the day the rate is set at
their principal amount (without regard to accrued interest). The Daily
Rate for any non-Business Day will be the rate for the last day for
which a rate was set.
(2) Weekly Rate. When interest on the Bonds is payable at a
Weekly Rate, the Remarketing Agent will set a Weekly Rate on or before
5:00 p.m., New York City time, on the last Business Day before the
commencement of a period during which the Bonds bear interest at a
Weekly Rate and on each Tuesday thereafter so long as interest on the
Bonds is to be payable at a Weekly Rate or, if any Tuesday is not a
Business Day, on the next preceding Business Day. Each Weekly Rate will
be the minimum rate necessary (as determined by the Remarketing Agent
based on the examination of tax-exempt obligations comparable to the
Bonds known by the Remarketing Agent to have been priced or traded under
then prevailing market conditions) for the Remarketing Agent to sell the
Bonds on the date the rate is set at their principal amount (without
regard to accrued interest). Thereafter, each Weekly Rate shall apply
to (i) the period beginning on the Wednesday after the Weekly Rate is
set and ending on the following Tuesday or, if earlier, ending on the
day before the effective date of a new method of determining the
interest rate on the Bonds or (ii) the period beginning on the effective
date of the change to a Weekly Rate and ending on the next Tuesday.
(3) Commercial Paper Rate. During a Commercial Paper Mode,
each Bond will bear interest during the Commercial Paper Period for such
Bond at the Commercial Paper Rate for such Bond. Different Commercial
Paper Periods may apply to different Bonds at any time and from time to
time. Except as otherwise described in this subparagraph (3), the
Commercial Paper Period and Commercial Paper Rate for each Bond will be
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determined by the Remarketing Agent no later than 12:15 p.m., New York
City time, on the first day of each Commercial Paper Period.
(i) Determination of Commercial Paper Periods. Each Commercial
Paper Period will be a period of at least one day and not more
than 365 days, determined by the Remarketing Agent to be the
period which, together with all other Commercial Paper Periods for
all Bonds then outstanding, will, in the judgment of the
Remarketing Agent, result in the lowest overall interest expense
on the Bonds over the next 365 days; provided, however, that at
any time at which a Credit Agreement is in effect, the Remarketing
Agent shall not establish any Commercial Paper Period which would
end at a time when no Credit Agreement is in effect. Each
Commercial Paper Period will end on either the day before a
Business Day or on the day before the Maturity Date for such Bond.
However, any Bond purchased on behalf of the Company and remaining
unsold by the Remarketing Agent as of the close of business on the
first day of the Commercial Paper Period for that Bond will have a
Commercial Paper Period of one day or, if that Commercial Paper
Period would not end on a day before a Business Day, a Commercial
Paper Period of the shortest possible duration greater than one
day ending on a day before a Business Day.
In determining the number of days in each Commercial Paper
Period, the Remarketing Agent shall take into account the
following factors: (I) existing short-term tax-exempt market rates
and indices of such short-term rates, (II) the existing market
supply and demand for short-term tax-exempt securities,
(III) existing yield curves for short-term and long-term tax-
exempt securities for obligations of credit quality comparable to
the Bonds, (IV) general economic conditions, (V) industry economic
and financial conditions that may affect or be relevant to the
Bonds, (VI) the number of days in other Commercial Paper Periods
applicable to the Bonds and (VII) such other facts, circumstances
and conditions as the Remarketing Agent, in its sole discretion,
shall determine to be relevant.
(ii) Determination of Commercial Paper Rates. The
Commercial Paper Rate for each Commercial Paper Period for each
Bond shall be the minimum rate necessary (as determined by the
Remarketing Agent based on the examination of tax-exempt
obligations comparable to the Bonds known by the Remarketing Agent
to have been priced or traded under the then-prevailing market
conditions) for the Remarketing Agent to sell such Bond on the
date and at the time of such determination at its principal amount
(without regard to accrued interest).
(4) Long-Term Interest Rate. The Remarketing Agent will set a
Long-Term Interest Rate on a date no more than 15 days before the
beginning of any period (a "Long-Term Interest Rate Period") in which
interest on any of the Bonds will be payable at a Long-Term Interest
Rate. Each Long-Term Interest Rate will be the minimum rate necessary
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(as determined by the Remarketing Agent based on the examination of tax-
exempt obligations comparable to the Bonds known by the Remarketing
Agent to have been priced or traded under then-prevailing market
conditions) for the Remarketing Agent to sell the Bonds on the effective
date of the Long-Term Interest Rate at their principal amount (without
regard to accrued interest).
(5) Failure of Remarketing Agent to Announce Interest Rates on
the Bonds. If the appropriate interest rate or Commercial Paper Period
is not or cannot be determined for whatever reason, the method of
determining interest on the Bonds shall be automatically converted to
the Weekly Rate (without the necessity of complying with the
requirements of Section 2.02(b)) and the interest rate shall be equal to
the J.J. Kenny Index, or such other index (or percentage of an index)
deemed appropriate for tax-exempt securities of the nature of the Bonds
as the Remarketing Agent, with the consent of the Trustee, may have
previously selected, until such time as the method of determining
interest on the Bonds can be changed in accordance with Section 2.02(b);
provided, that if the Bonds are then in a Long-Term Interest Rate
Period, the Bonds shall bear interest at a Weekly Rate, but only if a
Favorable Opinion of Tax Counsel with respect to the change to a Weekly
Rate has been delivered to the Trustee. If such Favorable Opinion of
Tax Counsel has not been delivered, the Bonds shall remain in a Long-
Term Interest Rate Period with an interest rate equal to the interest
rate for the prior Long-Term Interest Rate Period and with a duration
equal to the prior Long-Term Interest Rate Period (or, if earlier, a
Long-Term Interest Rate Period ending on the day before the Maturity
Date for such Bond). The Trustee shall promptly notify the Bondholders
of any such automatic change as set forth in Section 2.02(c).
While Bonds are in a Commercial Paper Mode, during any transition
period caused by an automatic conversion of such Bonds to a Weekly Rate
in accordance with this Subsection (5), Bonds bearing interest at a
Weekly Rate and Bonds bearing interest at a Commercial Paper Rate, as
applicable, shall be governed by the provisions of this Indenture
applicable to such methods of determining interest on the Bonds.
(b) (1) Change in Interest Rate Determination Method. The Company
may change the method of determining the interest rate on the Bonds by
notifying the Issuer, the Trustee, the Remarketing Agent and, if a Book-Entry
System is then in effect for the Bonds, the Securities Depository. Such notice
shall contain (a) the effective date, (b) the proposed interest rate
determination method, (c) if the change is to a Long-Term Interest Rate or
Rates, the last day of the first such Long-Term Interest Rate Period and, at
the option of the Company, the effective date and last day of any successive
Long-Term Interest Rate Periods (which last day for each Long-Term Interest
Rate Period must be either the day before the related Maturity Date for such
Bonds or a day which is before a Business Day and is at least 365 days after
the effective date), and (d) if the change is to a Commercial Paper Rate, the
termination date of any Credit Agreement which will be in effect during the
Commercial Paper Period. The Long-Term Interest Rate Period shall be the same
duration for all of the Bonds. The notice must be accompanied by a Favorable
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Opinion of Tax Counsel, except as described below. Except in the case of the
rescission of the Favorable Opinion of Tax Counsel described in
Section 2.02(e), if the Company's notice complies with this paragraph, the
interest rate on the Bonds will be payable at the new rate on the effective
date specified in the notice until there is another change as provided in this
Section. Notwithstanding anything in this Indenture to the contrary, the
Company must deliver a Favorable Opinion of Tax Counsel whenever there is a
change from a period during which the interest rate on the Bonds is set at
intervals of 365 days or less to a period during which the interest rate on
the Bonds is set at intervals in excess of 365 days, or vice versa.
If the Company wishes to designate successive Long-Term Interest Rate
Periods without specifying the effective dates and last days as described in
the preceding paragraph for the second or any subsequent Long-Term Interest
Rate Periods, it may do so by following the same procedure as for a change in
the interest rate determination method as provided in the foregoing paragraph.
If, 30 days before the end of a Long-Term Interest Rate Period, the
Company has not provided for the next interest rate period, a new Long-Term
Interest Rate Period of the same duration will follow (or if shorter, a Long-
Term Interest Rate Period ending on the day before the Maturity Date for the
Bonds).
When one Long-Term Interest Rate Period follows another, all provisions
of this Indenture applying to a change in the interest rate determination
method will apply, except:
(A) the redemption described under "Mandatory Redemption Upon a
Change in the Method of Determining the Interest Rate on the Bonds" in
the Bonds;
(B) the Company will not be required to deliver a Favorable
Opinion of Tax Counsel if a new Long-Term Interest Rate Period begins as
a result of the Company failing to provide for the next interest rate
period; and
(C) the Company will not be required to deliver a Favorable
Opinion of Tax Counsel if the Company has previously designated a series
of successive Long-Term Interest Rate Periods which, together with the
current Long-Term Interest Rate Period, are substantially equal in
length, and if a Favorable Opinion of Tax Counsel was delivered before
the first such Long-Term Interest Rate Period in that series which
applies to each successive Long-Term Interest Rate Period.
(2) Limitations. Any change in the method of determining interest on
the Bonds pursuant to paragraph (1) above must comply with the following:
(i) the effective date of a change (or each effective date in
the case of a change from a Commercial Paper Mode) shall be a Business
Day which is at least 15 days (30 days if a Long-Term Interest Rate is
then in effect and the effective date is before the day after the last
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day of a Long-Term Interest Rate Period) after the twelfth Business Day
after receipt by the Trustee of the Company's notice of the change;
(ii) if a Long-Term Interest Rate is then in effect, the
effective date of any change must be either the day after the last day
of the Long-Term Interest Rate Period or, except as described in
clause (iii) below, a day on which the Bonds would otherwise be subject
to redemption under the paragraph "Optional Redemption at a Premium
During Long-Term Interest Rate Period" in Section 8 of the Bonds if the
change did not occur; provided that if the effective date of the change
is before the day after the last day of the Long-Term Interest Rate
Period, the Company must also deliver an Opinion of Tax Counsel stating
that, as of the first day on which the Bonds were subject to optional
redemption during such Long-Term Interest Rate Period, the Company's
ability to terminate such Long-Term Interest Rate Period prior to the
day after the last day of such Long-Term Interest Rate Period did not
and does not adversely affect the exclusion of interest on the Bonds
from federal gross income;
(iii) if the Company has previously designated successive Long-
Term Interest Rate Periods, the effective date of each Long-Term
Interest Rate Period must be the day after the last day of the previous
Long-Term Interest Rate Period;
(iv) if a Commercial Paper Mode is then in effect, the effective
date of any change must be either the day after the last day of the
Commercial Paper Mode or, as to any Bond, the day after the last day of
the Commercial Paper Period then in effect (or to be in effect) with
respect to that Bond;
(v) if any Bonds have been called for redemption and the
redemption has not yet occurred, the effective date of the change cannot
be before such redemption date;
(vi) if a Long-Term Interest Rate or a Daily Rate is then in
effect, the effective date of any change cannot occur during the period
after a Record Date and to, but not including, the related Interest
Payment Date; and
(vii) if a Commercial Paper Mode is then in effect, the
Remarketing Agent shall determine Commercial Paper Periods of such
duration that will, in the judgment of the Remarketing Agent, best
promote an orderly transition on the effective date. After the receipt
by the Trustee of the Company's notice of such change, the day after the
last day of each Commercial Paper Period shall be, with respect to such
Bond, the effective date of the change. The Remarketing Agent shall
promptly give written notice of each such last date and each such
effective date with respect to each Bond to the Issuer, the Company, and
the Trustee.
During any such transition period, Bonds bearing interest at a
Commercial Paper Rate shall be governed by the provisions of this
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Indenture applicable to a Commercial Paper Mode and Bonds bearing
interest at a Daily Rate, Weekly Rate or Long-Term Interest Rate, as
applicable, shall be governed by the provisions of this Indenture
applicable to such methods of determining interest on the Bonds.
(c) Notice to Bondholders of Change in Interest Rate Determination
Method. When a change in the interest rate determination method is to be
made, or upon commencement of a new Long-Term Interest Rate Period, the
Trustee will, upon notice from the Company pursuant to Section 2.02(b), notify
the Bondholders by first class mail at least 15 days before the effective date
(or each effective date in the case of an adjustment from a Commercial Paper
Mode) of the change, except that such notice shall be given at least 30 days
prior to the effective date if a Long-Term Interest Rate is in effect and the
effective date is on or before the end of the Long-Term Interest Rate Period.
The notice shall be effective when sent and shall state:
(1) that the interest rate determination method will be changed
and what the new method will be;
(2) the effective date of the new rate; and
(3) that a mandatory redemption or mandatory purchase in lieu
of redemption will result on the effective date of the change as
provided in the Bonds and all the information required by this Indenture
to be included in a notice of redemption set forth in Section 3.04.
The information required in any notice pursuant to this subsection (c)
and the information referred to in any redemption notice (including an
Additional Notice) pursuant to Section 3.04 may be combined in a single notice
if it is sent to Bondholders in the manner and at the time specified under
"Notice of Redemption" in Section 8 of the form of the Bonds.
(d) Calculation of Interest. The Remarketing Agent shall provide the
Trustee and the Company with notice in writing or by telephone (any such
notice by telephone to be delivered to a Responsible Officer of the Trustee)
promptly confirmed by facsimile transmission by 12:30 p.m., New York City
time,
(1) on the first Business Day after a month in which interest
on the Bonds was payable at a Daily Rate, of the Daily Rate for each day
in such month;
(2) on each day on which a Weekly Rate becomes effective, of
the Weekly Rate;
(3) on the first day of each Commercial Paper Period, of the
length thereof and the Commercial Paper Rate, and, if there is more than
one Commercial Paper Rate then in effect, of the related applicable
principal amounts;
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(4) on the first Business Day of a Long-Term Interest Rate
Period, of the Long-Term Interest Rate or Long-Term Interest Rates set
for that period and the related applicable principal amounts; and
(5) on any Business Day preceding any redemption or purchase
date, any interest rate requested by the Trustee in order to enable it
to calculate the accrued interest, if any, due on such redemption or
purchase date.
Using the rates supplied by the notice required by this subsection (d),
the Trustee will calculate the interest payable on the Bonds. The Remarketing
Agent will inform the Trustee and the Company orally at the oral request of
either of them of any interest rate set by the Remarketing Agent. The Trustee
will confirm the effective interest rate by telephone or in writing to any
Bondholder who requests it in any manner.
The setting of the rates and the calculation of interest payable on the
Bonds as provided in this Indenture will be conclusive and binding on all
parties.
(e) Change in Rate Determination Method-Opinions of Counsel.
Notwithstanding any provision of this Section 2.02, no change shall be made in
the interest rate determination method at the direction of the Company
pursuant to Section 2.02(b)(1) hereof if the Trustee shall receive written
notice prior to such change that the Favorable Opinion of Tax Counsel required
under Section 2.02(b)(1) or Section 2.02(a)(5) or, if applicable, the Opinion
of Tax Counsel required by Section 2.02(b)(2)(ii), has been rescinded. If the
Trustee shall have sent any notice to the Bondholders regarding a change in
rate under Section 2.02(c), then in the event of such rescission of, or
failure to deliver, such opinion, the Trustee shall promptly notify all
Bondholders of such rescission.
(f) Notice to Bondholders of Voluntary Termination of Credit
Agreement. If the Trustee receives notice from the Company as provided in
Section 3.5 of the Agreement to the effect that the Company intends to
terminate the Credit Agreement prior to its stated termination date, the
Trustee shall notify the Bondholders by first class mail at least 15 Business
Days prior to the effective date of such termination. The notice shall be
effective when sent and shall state:
(1) that the Company has notified the Trustee that it intends
to terminate the Credit Agreement;
(2) the effective date of such termination; and
(3) if the interest is then payable at a Daily Rate or a Weekly
Rate, that the Bondholders have the right to tender Bonds to the Trustee
for purchase as provided in Section 6 of the form of the Bonds set out
in Exhibit A hereto.
Section 2.03. Execution and Authentication. The Bonds shall be
signed on behalf of the Issuer with the manual or facsimile signature of the
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Chairman or Vice Chairman of its board of directors, and attested by the
manual or facsimile signature of its Secretary or Assistant Secretary, and the
seal of the Issuer shall be impressed or imprinted on the Bonds by facsimile
or otherwise. All authorized facsimile signatures shall have the same effect
as if manually signed. If an officer of the Issuer whose signature is on a
Bond no longer holds that office at the time the Trustee authenticates the
Bond, the Bond shall nevertheless be valid. Also, if a person signing a Bond
is the proper officer on the actual date of execution, the Bond shall be valid
even if that person is not the proper officer on the nominal date of action.
A Bond shall not be valid for any purpose under this Indenture until the
Trustee manually signs the certificate of authentication on the Bond. Such
signature shall be conclusive evidence that the Bond has been authenticated
under this Indenture.
As a precondition to the initial authentication and delivery of the
Bonds, the Trustee shall receive a request and authorization to the Trustee
from the Issuer, signed by the Chairman or Vice Chairman of the board of
directors of the Issuer, to authenticate and deliver the Bonds to the persons
and in the manner therein described.
Section 2.04. Bond Register. Bonds must be presented at the
principal corporate trust office of the Trustee for registration, transfer,
exchange and payment. Bonds tendered by their holders must be delivered as
specified in the Bonds. The Trustee shall keep a register of Bonds and of
their transfer and exchange, which register shall be open to inspection by the
Issuer and the Company during normal business hours.
Section 2.05. Registration and Exchange of Bonds; Persons Treated as
Owners. Bonds may be transferred only on the register maintained by the
Trustee. Upon surrender for transfer of any Bond to the Trustee, duly
endorsed for transfer or accompanied by an assignment duly executed by the
holder or the holder's attorney duly authorized in writing, the Trustee will
authenticate a new Bond or Bonds of the same maturity, in an equal total
principal amount and registered in the name of the transferee.
Bonds may be exchanged for an equal total principal amount of Bonds of
the same maturity but of different authorized denominations. The Trustee will
authenticate and deliver Bonds that the Bondholder making the exchange is
entitled to receive, bearing numbers not then outstanding.
Except in connection with the purchase of Bonds tendered for purchase or
purchased in lieu of redemption, the Trustee will not be required to transfer
or exchange any Bond called for redemption or during the period beginning 15
days before the mailing of notice calling the Bonds or any portion of the
Bonds for redemption and ending on the redemption date.
The holder of a Bond shall be the absolute owner of the Bond for all
purposes, and payment of principal, interest or purchase price shall be made
only to or upon the written order of the holder or the holder's legal
representative.
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The Trustee will require the payment by a Bondholder requesting exchange
or transfer of any tax or other governmental charge required to be paid in
respect of the exchange or transfer but will not impose any other charge.
Section 2.06. Mutilated, Lost, Stolen, Destroyed or Undelivered
Bonds. If any Bond is mutilated, lost, stolen or destroyed, the Trustee will
authenticate a new Bond of the same maturity and denomination if any mutilated
Bond shall first be surrendered to the Trustee, and if, in the case of any
lost, stolen or destroyed Bond, there shall first be furnished to the Issuer,
the Trustee and the Company evidence of such loss, theft or destruction,
together with an indemnity, satisfactory to them. If the Bond has matured,
instead of issuing a replacement Bond, the Trustee may with the consent of the
Company pay the Bond without requiring surrender of the Bond and make such
requirements as the Trustee deems fit for its protection, including a lost
instrument bond. The Issuer, the Company and the Trustee may charge their
reasonable fees and expenses in this connection.
If a Bond is called for redemption and the Company elects to purchase
the Bond in lieu of redemption as provided in Article III, or if the holder of
a Bond gives irrevocable instructions to the Remarketing Agent for purchase,
and in each case funds are deposited with the Trustee sufficient for the
purchase, the Trustee upon request of the Company or the Remarketing Agent
will authenticate a new Bond in the same maturity and in the same denomination
registered as the Company or the Remarketing Agent may direct and deliver it
to the Company or upon the Company's order, whether or not the Bond purchased
or called for redemption is ever delivered, and the Bond purchased or called
for redemption shall be cancelled on the books of the Trustee, whether or not
said Bond has been delivered to the Trustee. From and after the purchase
date, interest on such Bond shall cease to be payable to the prior holder
thereof, such holder shall cease to be entitled to the benefits or security of
this Indenture and shall have recourse solely to the funds held by the Trustee
for the purchase of such Bond and the Trustee shall not register any further
transfer of such Bond by such prior holder. All funds held by the Trustee for
the purchase of undelivered Bonds shall be held uninvested.
Section 2.07. Cancellation of Bonds. Whenever a Bond is delivered
to the Trustee for cancellation (upon payment, redemption or otherwise), or
for transfer, exchange or replacement pursuant to Section 2.05 or
Section 2.06, the Trustee will promptly cancel and dispose of the Bond in
accordance with the Trustee's policy of disposal; provided, however, that the
Trustee shall not be required to destroy cancelled Bonds.
Section 2.08. Temporary Bonds. Until definitive Bonds are ready for
delivery, the Issuer may execute and the Trustee will authenticate temporary
Bonds substantially in the form of the definitive Bonds, with appropriate
variations. The Issuer will, without unreasonable delay, prepare and the
Trustee will authenticate definitive Bonds in exchange for the temporary
Bonds. Such exchange shall be made by the Trustee without charge.
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ARTICLE III
REDEMPTION, PURCHASES IN LIEU OF REDEMPTION AND REMARKETING
Section 3.01. Notices to Trustee. If the Company wishes that any
Bonds be redeemed pursuant to any optional redemption provision in the Bonds,
the Company will notify the Trustee of the applicable provision, the
redemption date, the principal amount of the Bonds to be redeemed and other
necessary particulars. The Company will give the notice at least 45 days
before the redemption date, or such shorter period of time agreed to by the
Trustee.
Section 3.02. Redemption Dates. The redemption date of Bonds to be
redeemed pursuant to any optional redemption provision in the Bonds will be a
date permitted by the Bonds and specified by the Company in the notice
delivered pursuant to the preceding Section. The redemption date for mandatory
redemptions will be as specified in the Bonds to be redeemed or determined by
the Trustee consistently with the provisions of the Bonds.
Section 3.03. Selection of Bonds to Be Redeemed. Except as provided
in the Bonds, if fewer than all the Bonds are to be redeemed, the Trustee will
select the Bonds to be redeemed by lot or other method it deems fair and
appropriate, except that the Trustee will first select any Bonds owned by the
Company or any of its nominees or held by the Trustee for the account of the
Company or any of its nominees. The Trustee will make the selection from
Bonds not previously called for redemption. For this purpose, the Trustee
will consider each Bond in a denomination larger than the minimum denomination
permitted by the Bonds at the time to be separate Bonds each in the minimum
denomination. Provisions of this Indenture that apply to Bonds called for
redemption also apply to portions of Bonds called for redemption.
Section 3.04. Redemption Notices.
(a) Official Notice of Redemption. The Trustee will give notice of
each redemption as provided in the Bonds and will at the same time give a copy
of the notice to the Remarketing Agent, provided that no redemption notice
shall be given with respect to a redemption under "Mandatory Redemption on
Each Interest Payment Date During Commercial Paper Mode" in Section 8 of the
form of the Bonds. The notice shall identify the Bonds to be redeemed and
will state (1) the redemption date (and, if the Bonds provide that accrued
interest will not be paid on the redemption date, the date it will be paid),
(2) the redemption price, (3) that the Bonds called for redemption must be
surrendered to collect the redemption price, (4) the address at which the
Bonds must be surrendered and (5) that interest on the Bonds called for
redemption ceases to accrue on the redemption date.
With respect to an optional redemption of any Bonds under "Optional
Redemption at a Premium During Long-Term Interest Rate Period," "Extraordinary
Optional Redemption" or "Optional Redemption During Daily or Weekly Rate
Period" in Section 8 of the form of the Bonds, unless moneys sufficient to pay
the principal of, redemption premium, if any, and interest on the Bonds to be
redeemed shall have been received by the Trustee prior to the giving of such
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notice of redemption, such notice may state that said redemption shall be
conditional upon the receipt of such moneys by the Trustee on or prior to the
date fixed for redemption. If such moneys are not received, such notice shall
be of no force and effect, the Issuer shall not redeem such Bonds, the
redemption price shall not be due and payable, and the Trustee shall give
notice, in the same manner in which the notice of redemption was given, that
such moneys were not so received and that such Bonds will not be redeemed.
Failure to give any required notice of redemption as to any particular
Bonds will not affect the validity of the call for redemption of any Bonds in
respect of which no such failure has occurred. Any notice mailed as provided
in the Bonds shall be effective when sent and will be conclusively presumed to
have been given whether or not actually received by any holder.
(b) Additional Notice of Redemption. In addition to the redemption
notice required above, if there is not a Book-Entry System in effect for the
Bonds, further notice (the "Additional Notice") shall be given by the Trustee
as set out below. No defect in the Additional Notice nor any failure to give
all or any portion of the Additional Notice shall in any manner defeat the
effectiveness of a call for redemption if notice is given as prescribed in
paragraph (a) above.
(1) Each Additional Notice of redemption shall contain the
information required in paragraph (a) above for an official notice of
redemption plus (i) the CUSIP numbers of all Bonds being redeemed;
(ii) the date of the Bonds as originally issued; (iii) the interest rate
determination method for, or the rate of interest borne by each Bond
being redeemed; (iv) the maturity date of each Bond being redeemed: and
(v) any other descriptive information needed to identify accurately the
Bonds being redeemed.
(2) Upon the payment of the redemption price of the Bonds being
redeemed, each check or other transfer of funds issued for such purpose
shall bear the CUSIP number identifying, by issue and maturity, the
Bonds being redeemed with the proceeds of such check or other transfer.
(3) Each Additional Notice of redemption shall be sent at least
30 days before the redemption date by registered or certified mail or
overnight delivery service (or by such other means as the Trustee may
have established with the securities depository or information service)
to all registered securities depositories then in the business of
holding substantial amounts of obligations similar to the Bonds (such
depositories now being Depository Trust Company of New York, New York,
Midwest Securities Trust Company of Chicago, Illinois, and Philadelphia
Depository Trust Company of Philadelphia, Pennsylvania) and to one or
more national information services that disseminate notices of
redemption of obligations such as the Bonds.
The information required in any redemption notice (including an
Additional Notice) pursuant to this Section and the information required in
any notice pursuant to Section 2.02(c) may be combined in a single notice if
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it is sent to Bondholders in the manner and at the time specified under
"Notice of Redemption" in Section 8 of the form of the Bonds.
Section 3.05. Payment of Bonds Called for Redemption. Upon
surrender to the Trustee, Bonds called for redemption shall be paid or
purchased in lieu of redemption as provided in this Article at the redemption
price stated in the notice, plus interest accrued to the redemption date, or
at a purchase price equal to principal plus accrued interest to the purchase
date, except that interest payable on Bonds bearing interest at a Daily Rate
will be paid on the fifth Business Day following the redemption date. Bonds
called for redemption and purchased pursuant to a tender before the redemption
date will not be redeemed but will be dealt with as provided below in this
Article.
Section 3.06. Bonds Redeemed in Part. Upon surrender of a Bond
redeemed or purchased in lieu of redemption in part, the Trustee will
authenticate for the holder a new Bond or Bonds in authorized denominations
equal in principal amount to the unredeemed or unpurchased portion of the Bond
surrendered.
Section 3.07. Purchase of Bonds in Lieu of Redemption. When Bonds
are called for redemption pursuant to the paragraphs captioned, "Mandatory
Redemption at Beginning of a New Long-Term Interest Rate Period" or "Mandatory
Redemption Upon a Change in the Method of Determining the Interest Rate on the
Bonds" in Section 8 of the form of the Bonds, the Company may purchase some of
or all the Bonds called for redemption for a price equal to the otherwise
applicable redemption price, if it (or the Remarketing Agent) gives written
notice to the Trustee by 5:00 p.m. New York City Time on the day before the
redemption date that it wishes to purchase the Bonds the principal amount of
which is specified in the notice and furnishes the Trustee sufficient money in
sufficient time for the Trustee to make the purchase on the redemption date.
The Trustee will purchase Bonds called for redemption pursuant to the
paragraph captioned "Mandatory Redemption on Each Interest Payment Date During
Commercial Paper Mode" unless otherwise instructed in writing by the Company,
or unless the Indenture otherwise requires that they be redeemed and
cancelled, before the redemption date. The Trustee will purchase the Bonds
pursuant to this Section only as provided in Section 4.02.
Section 3.08. Disposition of Purchased Bonds. (a) Bonds to be
Remarketed. Bonds purchased pursuant to tenders as provided in the Bonds or
in lieu of redemption as provided in the foregoing Section will be offered for
sale by the Remarketing Agent as provided in this Section except as follows:
(1) Bonds purchased pursuant to a tender after having been
called for redemption under a provision in the Bonds that does not
provide the Company an option to purchase in lieu of redemption will be
canceled.
(2) Bonds called for redemption under "Mandatory Redemption
Upon a Change in the Method of Determining the Interest Rate on the
Bonds" in Section 8 of the Bonds, which are tendered between the date
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notice of redemption is given and the redemption date, may be remarketed
before the redemption date only if the buyer receives a copy of the
redemption notice from the Remarketing Agent.
(3) Bonds will not be offered for sale under this Section
during the continuance of an Event of Default.
(b) Remarketing Effort. Except to the extent the Company directs the
Remarketing Agent not to do so, the Remarketing Agent will offer for sale and
use reasonable efforts to sell all Bonds to be sold as provided in paragraph
(a) above and, when directed by the Company, any Bonds held by the Company.
The sale price of each Bond must be equal to the principal amount of each Bond
plus accrued interest to the purchase date. The Company may direct the
Remarketing Agent from time to time to cease and to resume sales efforts with
respect to some of or all the Bonds. The Remarketing Agent may buy as
principal any Bonds to be offered under this Section.
(c) Notices in Respect of Tenders. When the Trustee receives a notice
from a Bondholder (or a Beneficial Owner through its direct Participant) as
specified in Section 6 of the Bonds for the bondholder (or a Beneficial Owner
through its direct Participant) to tender Bonds, the Trustee will promptly
notify the Remarketing Agent and the Company by facsimile transmission or
telephone, promptly confirmed in writing, of the receipt of such notice, but
in no event later than the following times:
(i) When the Bonds bear interest at a Daily Rate, no later
than 11:15 a.m. (New York City time) on the same Business Day; and
(ii) When the Bonds bear interest at a Weekly Rate, no later
than 11:15 a.m. (New York City time) on the Business Day next succeeding
receipt of such notice.
(d) Delivery of Remarketed Bonds.
(i) The Trustee shall hold all Bonds delivered pursuant to this
Section in trust for the benefit of the owners thereof until moneys
representing the Purchase Price of such Bonds shall have been delivered
to or for the account of or to the order of such Bondholders, and
thereafter, if such Bonds are remarketed, shall deliver replacement
Bonds, prepared by the Trustee in accordance with the directions of the
Remarketing Agent and authenticated by the Trustee, for any Bonds
purchased in accordance with the written directions of the Remarketing
Agent to the Remarketing Agent for delivery to the purchasers thereof.
(ii) The Remarketing Agent shall advise the Trustee and the
Company in writing or by facsimile transmission, promptly confirmed in
writing, of the principal amount of Bonds which have been remarketed,
together with the denominations and registration instructions (including
taxpayer identification numbers) in accordance with the following
schedule (all times of which are New York City time):
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CURRENT METHOD OF INTEREST
RATE DETERMINATION OR, IN
CONNECTION WITH A CHANGE IN
SUCH METHOD, THE NEW METHOD TIME BY WHICH INFORMATION TO BE
OF INTEREST RATE DETERMINATION FURNISHED TO TRUSTEE
Commercial Paper Period 12:15 p.m. on the purchase date
Daily Rate Period 12:15 p.m. on the purchase date
Weekly Rate Period 12:15 p.m. on the purchase date
Long-Term Interest Rate Period 12:15 p.m. on the purchase date
(iii) The terms of any sale by the Remarketing Agent shall
provide for the authorization of the payment of the Purchase Price by
the Remarketing Agent to the Trustee in exchange for Bonds registered in
the name of the new Bondholder which shall be delivered by the Trustee
to the Remarketing Agent at or before 2:00 p.m. (New York City time) on
the purchase date if the Purchase Price has been received from the
Remarketing Agent by the time set forth in Section 3.08(e) on the
purchase date. Such payment by the Remarketing Agent pursuant to such
authorization shall be made on such date.
(e) Delivery of Proceeds of Sale. The Remarketing Agent shall deliver
directly to the Trustee an amount equal to the principal amount thereof plus
accrued interest, if any, of the Bonds which the Remarketing Agent has advised
the Trustee have been remarketed pursuant to Section 3.08(d)(ii) no later than
12:30 p.m. (New York City time) on the purchase date.
ARTICLE IV
APPLICATION OF PROCEEDS AND PAYMENT OF BONDS
Section 4.01. Application of Proceeds. The Issuer will cause the
proceeds of the initial sale of the Bonds to be deposited with the Trustee.
On a date to be designated by the Company (but in no event later than December
31, 1995) the Trustee will disburse the proceeds of the initial sale of the
Bonds to the Series E Trustee for deposit in the bond fund under the Prior
Indenture, to be applied to pay a portion of the outstanding principal amount
of the Series E Bonds upon call for redemption.
Pursuant to Section 3.1 of the Agreement, the Company has agreed to pay
to the Series E Trustee the amount in excess of the proceeds of the Bonds
needed to accomplish the refunding described in this Section. Any investment
earnings remaining after the transfer of moneys to the Series E Trustee, will
be applied to the payment of interest on the Bonds on the next Interest
Payment Date.
Section 4.02. Payments of Bonds. The Trustee will make payments of
principal of, premium, if any, and interest on the Bonds from moneys available
to the Trustee under this Indenture for that purpose. The Trustee will pay
the Purchase Price of tendered Bonds first from the proceeds of the sale of
Bonds under Section 3.08 and second from other moneys available to the Trustee
for that purpose. All moneys received as proceeds of remarketing the Bonds
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under Section 3.08 shall be held segregated by the Trustee in a separate and
segregated account.
Section 4.03. Investments of Moneys. The Trustee will invest and
reinvest moneys held by the Trustee as directed by a Company Representative in
writing, to the extent permitted by law, in:
(a) Government Obligations;
(b) Bonds and notes of the Federal Land Bank;
(c) Obligations of the Federal Intermediate Credit Bank;
(d) Obligations of the Federal Bank for Cooperatives;
(e) Bonds and notes of Federal Home Loan Banks;
(f) Negotiable or non-negotiable certificates of deposit, time
deposits or similar banking arrangements, issued by a bank or trust company
(which may be the commercial banking department of the Trustee or any bank or
trust company under common control with the Trustee) or savings and loan
association which are insured by the Federal Deposit Insurance Corporation or
secured as to principal by Government Obligations;
(g) Investments made in or through the Trustee's cash sweep accounts
or other short term investment funds, the assets of which consist of
investments described in clause (a) above; or
(h) Other investments then permitted by law.
The Trustee may make investments permitted by this Article through its
own bond department or the bond department of any bank or trust company under
common control with the Trustee. Investments will be made so as to mature or
be subject to redemption at the option of the holder on or before the date or
dates that the Trustee anticipates that moneys from the investments will be
required. The Trustee, when authorized by the Company, may trade with itself
in the purchase and sale of securities for such investment. Investments will
be registered in the name of the Trustee and held by or under the control of
the Trustee. The Trustee will sell and reduce to cash a sufficient amount of
investments whenever the cash held by the Trustee is insufficient. The Trustee
shall not be liable for any loss from such investments to the extent directed
by the Company Representative and to the extent such directions have been
complied with by the Trustee.
Section 4.04. Moneys Held in Trust. The Trustee will hold in trust
for the benefit of the Bondholders all moneys held by it for any payment on
the Bonds. The proceeds of the initial sale of the Bonds shall be held in a
separate and segregated account by the Trustee until disbursed as described in
Section 4.01. Money received by the Remarketing Agent or the Trustee from the
sale of a Bond under Section 3.08 or for the purchase of a Bond will be held
segregated from other funds of the Remarketing Agent or the Trustee in trust
for the benefit of the person from whom such Bond was purchased or the person
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delivering such purchase money, as the case may be, and will not be invested.
The Trustee shall promptly, but in no event later than 30 days of their
original deposit, apply moneys received from the Company in accordance with
this Indenture and the Tax Agreement and as directed by the Company
Representative.
ARTICLE V
BOOK-ENTRY SYSTEM
Section 5.01. Book-Entry System. The Bonds shall be initially
issued in the name of Cede & Co., as nominee for The Depository Trust Company
as the initial Securities Depository and registered owner of such Bonds, and
held in the custody of the Securities Depository. A single certificate will
be issued and delivered to the Securities Depository for the Bonds. The
Beneficial Owners will not receive physical delivery of Bond certificates
except as provided herein. For so long as the Securities Depository shall
continue to serve as securities depository for such Bonds as provided herein,
all transfers of beneficial ownership interests will be made by book-entry
only, and no investor or other party purchasing, selling or otherwise
transferring beneficial ownership of such Bonds is to receive, hold or deliver
any Bond certificate. The Issuer, the Company and the Trustee will recognize
the Securities Depository or its nominee as the Bondowner of such Bonds for
all purposes, including notices and voting.
The Issuer and the Trustee covenant and agree, so long as The Depository
Trust Company shall continue to serve as Securities Depository for the Bonds,
to meet the requirements of The Depository Trust Company with respect to
required notices and other provisions of the Letter of Representations
executed with respect to the Bonds.
The Issuer, the Trustee and the Remarketing Agent may conclusively rely
upon (i) a certificate of the Securities Depository as to the identity of the
Participants in the Book-Entry-System and (ii) a certificate of any such
Participant as to the identity of, and the respective principal amount of
Bonds beneficially owned by, the Beneficial Owners.
Whenever, during the term of the Bonds, the beneficial ownership thereof
is determined by a book-entry at the Securities Depository, the requirements
in this Indenture of holding, delivering or transferring Bonds shall be deemed
modified to require the appropriate person to meet the requirements of the
Securities Depository as to registering or transferring the book-entry to
produce the same effect. Any provision hereof permitting or requiring
delivery of Bonds shall, while the Bonds are in a Book-Entry System, be
satisfied by the notation on the books of the Securities Depository in
accordance with applicable law.
The Trustee and the Issuer, at the direction and expense of the Company
and with the consent of the Remarketing Agent, may from time to time appoint a
successor Securities Depository and enter into an agreement with such
successor Securities Depository to establish procedures with respect to the
Bonds not inconsistent with the provisions of this Indenture. Any successor
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Securities Depository shall be a "clearing agency" registered under
Section 17A of the Securities Exchange Act of 1934, as amended.
None of the Issuer, the Company, the Trustee nor the Remarketing Agent
will have any responsibility or obligation to any Securities Depository, any
Participants in the Book-Entry System or the Beneficial Owners with respect to
(i) the accuracy of any records maintained by the Securities Depository or any
Participant; (ii) the payment by the Securities Depository or by any
Participant of any amount due to any Beneficial Owner in respect of the
principal amount or redemption or purchase price of, or interest on, any
Bonds; (iii) the delivery of any notice by the Securities Depository or any
Participant; (iv) the selection of the Beneficial Owners to receive payment in
the event of any partial redemption of the Bonds; or (v) any other action
taken by the Securities Depository or any Participant.
Bond certificates are required to be delivered to and registered in the
name of the Beneficial Owner, under the following circumstances:
(a) The Securities Depository determines to discontinue
providing its service with respect to the Bonds and no successor
Securities Depository is appointed as described above. Such a
determination may be made at any time by giving 30 days' notice to the
Issuer, the Company and the Trustee and discharging its responsibilities
with respect thereto under applicable law; or
(b) The Company determines not to continue the Book-Entry
System through a Securities Depository.
The Trustee is hereby authorized to make such changes to the form of
bond attached hereto as Exhibit A which are not inconsistent with this
Indenture and which are necessary or appropriate to reflect that the Book-
Entry System is not in effect, that a successor Securities Depository has been
appointed or that an additional or co-paying agent or tender agent has been
designated pursuant to Section 13.03 hereof.
If at any time, the Securities Depository ceases to hold the Bonds all
references herein to the Securities Depository shall be of no further force or
effect.
ARTICLE VI
COVENANTS
Section 6.01. Payment of Bonds. The Issuer will promptly pay the
principal or purchase price of, premium, if any, and interest on the Bonds on
the dates and in the manner provided in the Bonds, but only from the amounts
assigned to and held by the Trustee under this Indenture.
Section 6.02. Recording and Filing; Further Assurances. (a) The
Trustee shall cooperate with the Company in causing to be filed all necessary
financing statements and continuation statements related to this Indenture and
all supplements hereto, and such other documents as may be, in the Opinion of
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Counsel, necessary to be kept and filed in such manner and in such places as
may be required by law in order to preserve and protect fully the security of
the Bondholders and the rights of the Trustee hereunder.
(b) The Issuer will execute and deliver such supplemental indentures
and such further instruments, and do such further acts, as the Trustee may
reasonably require for the better assuring, assigning and confirming to the
Trustee the amounts assigned under this Indenture for the payment of the
Bonds.
Section 6.03. 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 that end, the Issuer and the Company will comply with all
requirements of the Code and the 1954 Code to the extent applicable to the
Bonds. If at any time the Issuer or the Company is of the opinion that for
purposes of this Section 6.03 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 including, if necessary, the investment of such moneys in
obligations of any state, any political subdivision thereof, or any public
corporation or instrumentality of either thereof, the interest on which is
excludable from gross income under the Code.
Without limiting the generality of the foregoing, the Issuer and the
Company agree that there shall be paid from time to time all amounts required
to be rebated to the United States pursuant to Section 148(f) of the Code and
any temporary, proposed or final Treasury Regulations as may be applicable to
the Bonds from time to time. 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 4.6 of
the Agreement and in the Tax Agreement. The Issuer and the Trustee hereby
covenant and agree to cooperate fully with the Company regarding compliance
with the provisions of this Article VI and Section 4.6 of the Agreement.
Notwithstanding any provision of this Section, if the Company provides
to the Trustee and the Issuer an Opinion of Tax Counsel to the effect that any
action required under this Section is no longer required, or to the effect
that some further action is required, to maintain the exclusion of interest on
the Bonds from federal gross income, the Trustee and the Issuer may
conclusively rely on such opinion in complying with the provisions of this
Indenture, and the covenants under this Indenture shall be deemed to be
modified to that extent.
Section 6.04. Termination of Subordinated Security Interest. Upon
Satisfaction by the Company of its obligations under Section 3.1 of the
Agreement, the Trustee shall execute and deliver to the Company such documents
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as shall be necessary to effect or evidence the termination and release of the
Subordinated Security Interest (as defined in the Agreement).
ARTICLE VII
DISCHARGE OF INDENTURE
Section 7.01. Bonds Deemed Paid; Discharge of Indenture. Any Bond
will be deemed paid for all purposes of this Indenture when (a) payment of the
principal of and interest on the Bond to the due date of such principal and
interest (whether at maturity, upon redemption or otherwise) or the payment of
the Purchase Price either (1) has been made in accordance with the terms of
the Bonds or (2) has been provided for by depositing with the Trustee
(A) moneys sufficient to make such payment and/or (B) Government Obligations
maturing as to principal and interest in such amounts and at such times as
will insure the availability of sufficient moneys to make such payment, and
(b) all compensation and reasonable expenses of the Trustee pertaining to each
Bond in respect of which such deposit is made have been paid or provided for
to the Trustee's satisfaction. When a Bond is deemed paid, it will no longer
be secured by or entitled to the benefits of this Indenture or be an
obligation of the Issuer, except for payment from moneys or Government
Obligations under (a)(2) above and except that it may be tendered if and as
provided in the Bonds and it may be transferred, exchanged, registered,
discharged from registration or replaced as provided in Article II.
Notwithstanding the foregoing, upon the deposit of funds under
clause (a)(2) of the first paragraph of this Section, the purchase price of
tendered Bonds shall be paid from the sale of Bonds under Section 3.08. If
payment of such purchase price is not made from the above sources, payment
shall be made from funds on deposit pursuant to this Section, in which case
such Bonds shall be surrendered to the Trustee and cancelled.
Notwithstanding the foregoing, no deposit under clause (a)(2) of the
first paragraph of this Section shall be deemed a payment of a Bond until the
Company has furnished the Trustee an Opinion of Tax Counsel stating that the
deposit of such cash or Government Obligations will not cause the Bonds to
become "arbitrage bonds" under Section 148 of the Code and until (a) notice of
redemption of the Bond is given in accordance with Article III or, if the Bond
is not to be redeemed or paid within the next 60 days, until the Company has
given the Trustee, in form satisfactory to the Trustee, irrevocable
instructions (i) to notify, as soon as practicable, the owner of the Bond, in
accordance with Article III, that the deposit required by (a)(2) above has
been made with the Trustee and that the Bond is deemed to be paid under this
Article and stating the maturity or redemption date upon which moneys are to
be available for the payment of the principal of the Bond, and premium, if
any, and interest on such Bond, if the Bond is to be redeemed rather than paid
and (ii) to give notice of redemption not less than 30 nor more than 60 days
prior to the redemption date for such Bond or (b) the maturity of the Bond.
When all outstanding Bonds are deemed paid under the foregoing
provisions of this Section, the Trustee will upon request acknowledge the
discharge of the lien of this Indenture, provided, however that the
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obligations relating to the tender for purchase as provided in the Bonds and
obligations under Article II in respect of the transfer, exchange,
registration, discharge from registration and replacement of Bonds shall
survive the discharge of the lien of the Indenture.
No deposit will be made or accepted and no use made of any such deposit
which would cause any Bonds to be treated as "arbitrage bonds" within the
meaning of Section 148 of the Code.
Section 7.02. Application of Trust Money. The Trustee shall hold in
trust money or Government Obligations deposited with it pursuant to the
preceding Section and shall apply the deposited money and the money from the
Government Obligations in accordance with this Indenture only to the payment
of principal of, premium, if any, and interest on the Bonds and to the payment
of the purchase price of tendered Bonds.
Section 7.03. Repayment to Company. The Trustee shall promptly pay
to the Company upon request any excess money or securities held by the Trustee
at any time under this Article and any money held by the Trustee under any
provision of this Indenture for the payment of principal or interest or for
the purchase of Bonds that remains unclaimed for five years.
ARTICLE VIII
DEFAULTS AND REMEDIES
Section 8.01. Events of Default. An "Event of Default" is any of
the following:
(a) Default in the payment of any interest on any Bond when due
and as the same shall become due and payable, which default continues
for five days.
(b) Default in the due and punctual payment of principal on any
Bond when due and payable, whether at maturity, upon redemption, or by
declaration or otherwise.
(c) Default in the payment of the purchase price of any Bond
tendered by its Beneficial Owner pursuant to the Bonds.
(d) An event of default has occurred and is continuing under
the Agreement.
Section 8.02. Acceleration. Whenever an Event of Default has
occurred and is continuing, the Bonds shall without further action become
immediately due and payable.
Section 8.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may, and upon request of the holders of at least 25%
in principal amount of the Bonds then outstanding shall, pursue any available
remedy by proceeding at law or in equity to collect the principal of or
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interest on the Bonds or to enforce the performance of any provision of the
Bonds, this Indenture or the Agreement.
The Trustee, as the assignee of all the right, title and interest of the
Issuer in and to the Agreement, shall enforce each and every right granted to
the Issuer under the Agreement.
The Trustee may maintain a proceeding even if it does not possess any of
the Bonds or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Bondholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
In the event of a bankruptcy or reorganization of the Company, the
Trustee may file a proof of claim on behalf of all Bondholders with respect to
the obligations of the Company pursuant to the Agreement.
Section 8.04. Waiver of Past Defaults. The holders of a majority in
principal amount of the Bonds then outstanding by notice to the Trustee may
waive an existing Event of Default and its consequences. When an Event of
Default is waived, it is cured and stops continuing, but no such waiver shall
extend to any subsequent or other Event of Default or impair any right
consequent to it.
Section 8.05. Control by Majority. The holders of a majority in
principal amount of the Bonds then outstanding may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
of exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 9.01, that the Trustee determines is unduly prejudicial to
the rights of other Bondholders, or would involve the Trustee in personal
liability.
Section 8.06. Limitation on Suits. A Bondholder may not pursue any
remedy with respect to this Indenture or the Bonds unless (a) the holder gives
the Trustee notice stating that an Event of Default is continuing, (b) the
holders of at least 25% in principal amount of the Bonds then outstanding make
a written request to the Trustee to pursue the remedy, (c) such holder or
holders offer to the Trustee indemnity satisfactory to the Trustee against any
loss, liability or expense and (d) the Trustee does not comply with the
request within 60 days after receipt of the request and the offer of
indemnity.
A Bondholder may not use this Indenture to prejudice the rights of
another Bondholder or to obtain a preference or priority over the other
Bondholders.
Section 8.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any holder
to receive payment of principal of and interest on a Bond, on or after the due
dates expressed in the Bond, or the purchase price of a Bond on or after the
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date for its purchase as provided in the Bond, or to bring suit for the
enforcement of any such payment on or after such dates, shall not be impaired
or affected without the consent of the holder.
Section 8.08. Collection Suit by Trustee. If an Event of Default
under Section 8.01(a), (b) or (c) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against
the Company for the whole amount remaining unpaid.
Section 8.09. Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Bondholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the holders in any election of a trustee in bankruptcy or other
person performing similar functions. In the event of a bankruptcy or
reorganization of the Company, the Trustee may file a proof of claim on behalf
of all Bondholders with respect to the obligations of the Company pursuant to
the Agreement.
Section 8.10. Priorities. If the Trustee collects any money
pursuant to this Article, it shall pay out the money in the following order:
FIRST: To the Trustee for amounts to which it is
entitled under Section 9.06.
SECOND: To Bondholders for amounts due and unpaid on the Bonds
for principal and interest, ratably, without
preference or priority of any kind, according to the
amounts due and payable on the Bonds for principal and
interest, respectively.
THIRD: To the Company.
The Trustee may fix a payment date for any payment to the Bondholders.
Section 8.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any
party litigant in the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This Section does not
apply to a suit by the Trustee, a suit by a holder pursuant to Section 8.07 or
a suit by holders of more than 10% in principal amount of the Bonds then
outstanding.
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ARTICLE IX
TRUSTEE AND REMARKETING AGENT
Section 9.01. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise its rights and powers
and use the same degree of care and skill in their exercise as a prudent
person would exercise or use under the circumstances in the conduct of such
person's own affairs.
(b) Except during the continuance of an Event of Default,
(1) the Trustee need perform only those duties that are
specifically set forth in this Indenture and applicable laws and
regulations, and no others and no implied duties or covenants shall be
read into this Indenture against the Trustee, and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed, upon certificates, opinions, requisitions or
any other writing furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own grossly
negligent action, its own grossly negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b)
of this Section,
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts,
(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 8.05, and
(4) 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, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to all the paragraphs of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
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liability or expense, but the Trustee may not require indemnity as a condition
to declaring the principal of and interest on the Bonds to be due immediately
under Section 8.02 or to making any payment of principal or interest on the
Bonds.
(f) The Trustee shall not be liable for interest on any cash held by
it except as the Trustee may agree with the Company or the Issuer with the
consent of the Company.
(g) In addition to the funds and accounts established by this
Indenture, the Trustee may establish such funds and accounts as it deems
necessary and appropriate in order to discharge its duties under this
Indenture.
Section 9.02. Rights of Trustee. Subject to the foregoing Section:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on any certificate of an
appropriate officer or officers of the Issuer or the Company or Opinion
of Counsel.
(c) The Trustee may act through agents or co-trustees but shall
be answerable for the conduct of the same in accordance with the
standards specified in this Indenture.
Section 9.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Bonds and
may otherwise deal with the Issuer or with the Company or its affiliates with
the same rights it would have if it were not Trustee.
Section 9.04. Trustee's Disclaimer. The Trustee makes no
representation as to the validity or adequacy of this Indenture, the Agreement
or the Bonds, and it shall not be responsible for any statement in the Bonds
other than its certificate of authentication.
Section 9.05. Notice of Defaults. If an event occurs which with the
giving of notice or lapse of time or both would be an Event of Default, and if
the event is continuing and if it is known to the Trustee, the Trustee shall
promptly mail to each Bondholder notice of the event. Except in the case of a
default in payment or purchase on any Bonds, the Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Bondholders.
Section 9.06. Compensation and Indemnity of Trustee. For acting
under this Indenture, the Trustee shall be entitled to payment of reasonable
fees for its services and reimbursement of advances, reasonable counsel fees
and other expenses reasonably and necessarily made or incurred by the Trustee
32
<PAGE>
as shall be agreed upon in writing by the Trustee and the Company from time to
time in connection with its services under this Indenture.
To secure the payment or reimbursement to the Trustee provided for in
this Section, the Trustee shall have a senior claim, to which the Bonds are
made subordinate, on all money or property held or collected by the Trustee,
except that held under Article VII or otherwise held in trust to pay principal
of and interest on particular Bonds.
The Company has agreed in the Agreement to indemnify the Trustee for,
and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of this trust, including the reasonable
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
Section 9.07. Eligibility of Trustee. This Indenture shall always
have a Trustee that is a corporation or association organized and doing
business under the laws of the United States or any state or the District of
Columbia, is authorized under such laws to exercise corporate trust powers, is
subject to supervision or examination by United States, state or District of
Columbia authority and has a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition. If at any time the Trustee ceases to be eligible in accordance
with this Section, the Trustee will resign immediately as set forth in Section
9.08.
Section 9.08. Replacement of Trustee. (a) The Trustee may resign by
notifying the Issuer and the Company and by mailing notice by first class mail
to the Bondholders.
Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee by an instrument in writing; provided that the
Company may not make such appointment if an Event of Default has occurred and
is continuing, or if an event has occurred and is continuing which, with the
passage of time or the giving of notice or both will become an Event of
Default. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee or any Bondholder who
has been a bona fide holder of a Bond for at least six months may, on behalf
of himself and others similarly situated, petition any such court for the
appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and may prescribe, appoint a successor
trustee.
(b) In case at any time either of the following shall occur:
(1) the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.07 and shall fail to resign after written
request therefor by the Company or the Issuer, or
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(2) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, the Company shall remove the Trustee and appoint a
successor trustee by an instrument in writing; provided that the Company may
not make such appointment if an Event of Default has occurred and is
continuing, or if an event has occurred and is continuing which, with the
passage of time or the giving of notice or both will become an Event of
Default, or any Bondholder may, on behalf of itself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and may prescribe, remove the
Trustee and appoint a successor trustee.
(c) Except as otherwise provided in this subsection (c), the Company
or holders of a majority in aggregate principal amount of the Bonds at the
time outstanding may at any time remove the Trustee and appoint a successor
trustee by an instrument or concurrent instruments in writing signed by the
Company or such Bondholders, as the case may be. The Company may not remove
the Trustee if an Event of Default has occurred and is continuing or if an
event has occurred and is continuing which, with the passage of time or the
giving of notice will become an Event of Default.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 9.09. The Company shall give written notification to any
rating agency then rating the Bonds of such successor trustee appointed
pursuant to this Section.
Section 9.09. Acceptance of Trust by Successor Trustee. Any
successor trustee appointed as provided in Section 9.08 shall execute,
acknowledge and deliver to the Issuer and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts, duties, and obligations of its
predecessor in the trusts hereunder, with like effect as if originally named
as Trustee herein; but, nevertheless, on the written request of the Issuer or
the request of the successor trustee, the Trustee ceasing to act shall execute
and deliver an instrument transferring to such successor trustee, upon the
trusts herein expressed, all the rights, power and trusts of the Trustee so
ceasing to act. Upon request of any such successor trustee, the Issuer shall
execute any and all instruments in writing necessary or desirable for more
fully and certainly vesting in and confirming to such successor trustee all
such rights, powers, and duties. Any Trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by
such Trustee to secure the amounts due it as compensation, reimbursement,
expenses, and indemnity afforded to it by Section 9.06.
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No successor trustee shall accept appointment as provided in this
Section 9.09 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 9.07.
At the time of appointment, the Company and the successor trustee shall
execute an agreement with respect to the compensation of the successor
trustee.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Issuer or such successor trustee shall give Bondholders
notice of the succession of such trustee to the trusts hereunder in the manner
prescribed in Section 9.08 for the giving of notice of resignation of the
Trustee.
Section 9.10. [reserved].
Section 9.11. Duties of Remarketing Agent. The Remarketing Agent
will set the interest rates on the Bonds and perform the other duties provided
for in Section 2.02 and will remarket Bonds as provided in Section 3.08,
subject to any provisions of a remarketing agreement between the Company and
the Remarketing Agent, which shall control in the case of any conflict with
this Indenture. The Remarketing Agent may for its own account or as broker or
agent for others deal in Bonds and may do anything any other Bondholder may do
to the same extent as if the Remarketing Agent were not serving as such.
Section 9.12. Eligibility of Remarketing Agent. The initial
Remarketing Agent appointed under this Indenture is Lehman Brothers Inc., New
York, New York. The Remarketing Agent will be a bank, trust company or member
of the National Association of Securities Dealers, Inc. organized and doing
business under the laws of the United States or any state or the District of
Columbia, will have a combined capital stock, surplus and undivided profits of
at least $15,000,000 as shown in its most recent published annual report, will
be a Participant in the Securities Depository and will be authorized by law to
perform all the duties imposed upon it by this Indenture. Any successor
Remarketing Agent shall be rated at least Baa3/P-3 or otherwise qualified by
Moody's Investors Service, Inc. or have an equivalent rating of another rating
agency.
Section 9.13. Replacement of Remarketing Agent. The Remarketing
Agent may resign by notifying the Issuer, Trustee, and Company. Such
resignation will take effect on the day a successor Remarketing Agent
appointed in accordance with this Section has accepted the appointment or, if
no successor has so accepted, 30 days after notice of resignation has been
sent. The Company may remove the Remarketing Agent at any time by an
instrument signed by the Company and filed with the Remarketing Agent, the
Issuer, and the Trustee at least 30 days prior to the effective date of such
removal (which will not in any event occur prior to the appointment of a
successor Remarketing Agent). A new Remarketing Agent may be appointed by the
Company upon the resignation or removal of the Remarketing Agent. The Trustee
shall promptly notify the Bondholders of any change in the Remarketing Agent.
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Section 9.14. Compensation of Remarketing Agent. The Remarketing
Agent will not be entitled to any compensation from the Issuer, the Trustee or
any property held under this Indenture but must make separate arrangements
with the Company for compensation.
Section 9.15. Successor Trustee or Remarketing Agent by Merger. If
the Trustee or Remarketing Agent consolidates with, merges or converts into,
or transfers all or substantially all its assets (or, in the case of a bank or
trust company, its corporate trust assets) to another corporation, the
resulting, surviving or transferee corporation without any further act shall
be the successor Trustee or Remarketing Agent, provided that such successor
shall be eligible under the applicable provisions in this Article.
ARTICLE X
AMENDMENTS OF AND SUPPLEMENTS TO INDENTURE
Section 10.01. Without Consent of Bondholders. The Issuer and the
Trustee may amend or supplement this Indenture or the Bonds without notice to
or consent of any Bondholder:
(a) to cure any ambiguity, inconsistency, or formal defect or
omission;
(b) to grant to the Trustee for the benefit of the Bondholders
additional rights, remedies, powers, or authority;
(c) to subject to this Indenture additional collateral or to add
other agreements of the Issuer;
(d) to modify this Indenture or the Bonds to permit
qualification under the Trust Indenture Act of 1939 or any similar
federal statute at the time in effect, or to permit the qualification of
the Bonds for sale under the securities laws of any state of the United
States;
(e) to authorize different authorized denominations of the Bonds
and to make correlative amendments and modifications to this Indenture
regarding exchangeability of Bonds of different authorized
denominations, redemptions of portions of Bonds of particular authorized
denominations and similar amendments and modifications of a technical
nature;
(f) to increase or decrease the number of days specified
for the giving of notices in Section 2.02 and to make corresponding
changes to the period for notice of redemption of the Bonds; provided
that no decreases in any such number of days shall become effective
except while the Bonds bear interest at a Daily Rate or a Weekly Rate
and until 30 days after the Trustee has given notice to the owners of
the Bonds;
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(g) to provide for an uncertificated system of registering the
Bonds or to provide for the change to or from a Book-Entry System for
the Bonds;
(h) to evidence the succession of a new Trustee or the
appointment by the Trustee or the Issuer of a co-trustee; or
(i) to make any change (including a change in Section 4.01
to reflect any amendment to the Code or interpretations thereof by the
Internal Revenue Service) that does not materially adversely affect the
rights of any Bondholder.
Section 10.02. With Consent of Bondholders. If an amendment of or
supplement to this Indenture or the Bonds without any consent of Bondholders
is not permitted by the preceding Section, the Issuer and the Trustee may
enter into such amendment or supplement without prior notice to any
Bondholders but with the consent of the holders of at least a majority in
principal amount of the Bonds then outstanding. However, without the consent
of each Bondholder affected, no amendment or supplement may (a) extend the
maturity of the principal of, or interest on, any Bond, (b) reduce the
principal amount of, or rate of interest on, any Bond, (c) effect a privilege
or priority of any Bond or Bonds over any other Bond or Bonds, (d) reduce the
percentage of the principal amount of the Bonds required for consent to such
amendment or supplement, (e) impair the exclusion from federal gross income of
interest on any Bond, (f) eliminate the holders' rights to tender the Bonds,
or any mandatory redemption of the Bonds, extend the due date for the purchase
of Bonds tendered by the holders thereof or call for mandatory redemption or
reduce the purchase or redemption price of such Bonds, (g) create a lien
ranking prior to or on a parity with the lien of this Indenture on the
property described in the Granting Clause of this Indenture, or (h) deprive
any Bondholder of the lien created by this Indenture on such property. In
addition, if moneys or Government Obligations have been deposited or set aside
with the Trustee pursuant to Article VII for the payment of Bonds and those
Bonds shall not have in fact been actually paid in full, no amendment to the
provisions of that Article shall be made without the consent of the holder of
each of those Bonds affected.
Section 10.03. Effect of Consents. Any consent received pursuant to
Section 10.02 will bind each Bondholder delivering such consent and each
subsequent holder of a Bond or portion of a Bond evidencing the same debt as
the consenting holder's Bond.
Section 10.04. Notation on or Exchange of Bonds. If an amendment or
supplement changes the terms of a Bond, the Trustee may require the holder to
deliver it to the Trustee. The Trustee may place an appropriate notation on
the Bond about the changed terms and return it to the holder. Alternatively,
if the Trustee, the Issuer and the Company determine, the Issuer in exchange
for the Bond will issue and the Trustee will authenticate a new Bond that
reflects the changed terms.
Section 10.05. Signing by Trustee of Amendments and Supplements. The
Trustee will sign any amendment or supplement to the Indenture or the Bonds
37
<PAGE>
authorized by this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities, or immunities of the Trustee. If it
does, the Trustee may, but need not, sign it. In signing an amendment or
supplement, the Trustee will be entitled to receive and (subject to Section
9.01) will be fully protected in relying on an Opinion of Counsel stating that
such amendment or supplement is authorized by this Indenture.
Section 10.06. Company Consent Required. An amendment or supplement
to this Indenture or the Bonds shall not become effective unless the Company
delivers to the Trustee its written consent to the amendment or supplement.
Section 10.07. Notice to Bondholders. The Trustee shall cause notice
of the execution of each supplement or amendment to this Indenture or the
Agreement to be mailed to the Bondholders. The notice will at the option of
the Trustee, either (i) briefly state the nature of the amendment or
supplement and that copies of it are on file with the Trustee for inspection
by Bondholders or (ii) enclose a copy of such amendment or supplement.
ARTICLE XI
AMENDMENTS OF AND SUPPLEMENTS TO THE AGREEMENT
Section 11.01. Without Consent of Bondholders. The Issuer may enter
into, and the Trustee may consent to, any amendment of or supplement to the
Agreement, or may waive compliance by the Company of any provision of the
Agreement, without notice to or consent of any Bondholder, if the amendment,
supplement, or waiver is required or permitted (a) by the provisions of the
Agreement or this Indenture (including in connection with transactions
permitted by Section 6.3 of the Original Agreement, relating to maintenance of
the Company's existence), (b) to cure any ambiguity, inconsistency or formal
defect or omission, (c) to identify more precisely the Project, (d) in
connection with any authorized amendment of or supplement to this Indenture or
(e) to make any change that does not materially adversely affect the rights of
any Bondholder.
Section 11.02. With Consent of Bondholders. If an amendment of or
supplement to the Agreement without any consent of Bondholders is not
permitted by the foregoing Section, the Issuer may enter into, and/or the
Trustee may consent to (as the case may be), such amendment or supplement, or
may waive compliance by the Company of any provision of the Agreement, without
notice to any Bondholder but with the consent of the holders of at least a
majority in principal amount of the Bonds then outstanding. However, without
the consent of each Bondholder affected, no amendment, supplement or waiver
may result in anything described in the lettered clauses of Section 10.02.
Section 11.03. Consents by Trustee to Amendments or Supplements. The
Trustee will consent to any amendment or supplement to the Agreement
authorized by this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities, or immunities of the Trustee. If it
does, the Trustee may, but need not, sign it. In signing a consent to an
amendment or supplement, the Trustee shall be entitled to receive and (subject
38
<PAGE>
to Section 9.01) shall be fully protected in relying on an Opinion of Counsel
stating that such amendment or supplement is authorized by this Indenture.
ARTICLE XII
[reserved]
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Notices. (a) Any notice, request, direction,
designation, consent, acknowledgment, certification, appointment, waiver, or
other communication required or permitted by this Indenture or the Bonds must
be in writing except as expressly provided otherwise in this Indenture or the
Bonds.
(b) Any notice or other communication shall be sufficiently given and
deemed given when delivered by hand or mailed by first-class mail, postage
prepaid, addressed as follows: if to the Issuer, if by mail to the Chairman
of the Board of Directors, at Town Hall, Columbia, Alabama 36319; if to the
Trustee, to P. O. Box 2554, Birmingham, Alabama 35290, Attention: Corporate
Trust Department; if to the Company, to 600 North 18th Street, Birmingham,
Alabama 35203, Attention: Treasurer; and if to the Remarketing Agent, to
Lehman Brothers Inc., 200 Vesey Street, 8th Floor, New York, New York 10285,
Attention: Municipal Note Desk. Any addressee may designate additional or
different addresses for purposes of this Section.
Section 13.02. Bondholders' Consents. Any consent or other
instrument required by this Indenture to be signed by Bondholders may be in
any number of concurrent documents and may be signed by a Bondholder or by the
holder's agent appointed in writing. Proof of the execution of such
instrument or of the instrument appointing an agent and of the ownership of
Bonds, if made in the following manner, shall be conclusive for any purposes
of this Indenture with regard to any action taken by the Trustee under the
instrument:
(a) The fact and date of a person's signing an instrument may be
proved by the certificate of any officer in any jurisdiction who by law
has power to take acknowledgments within that jurisdiction that the
person signing the writing acknowledged before the officer the execution
of the writing, or by an affidavit of any witness to the signing.
(b) The fact of ownership of Bonds, the amount or amounts,
numbers and other identification of such Bonds and the date of holding
shall be proved by the registration books kept pursuant to this
Indenture.
In determining whether the holders of the required principal amount of
Bonds outstanding have taken any action under this Indenture, Bonds owned by
the Company or any person controlling, controlled by or under common control
39
<PAGE>
with the Company shall be disregarded and deemed not to be outstanding. In
determining whether the Trustee shall be protected in relying on any such
action, only Bonds which the Trustee knows to be so owned shall be
disregarded.
Any consent or other instrument shall be irrevocable and shall bind any
subsequent owner of such Bond or any Bond delivered in substitution therefor.
Section 13.03. Appointment of Separate Paying Agent and/or Tender
Agent. If, at any time, the Securities Depository ceases to hold the Bonds,
with the effect that the Bonds are no longer subject to the Book-Entry System,
then the Issuer and the Trustee, acting at the request of the Company, may
appoint one or more banks or trust companies to act as paying agent and/or
tender agent for the Bonds hereunder. Any such paying agent or tender agent
shall be a bank or trust company organized under the laws of the United States
of America or any state thereof, shall have a reported capital and surplus of
at least $100,000,000 and a corporate trust office located in New York, New
York at which Bonds may be presented for payment or purchase and shall perform
such duties and responsibilities as may be delegated to it hereunder. If such
a paying agent or tender agent is appointed, then all references herein to the
"Trustee" shall include such paying agent or tender agent to the extent of the
duties performed by such entity.
Section 13.04. Limitation of Rights. Nothing expressed or implied in
this Indenture or the Bonds shall give any person other than the Trustee,
Issuer, Company, Remarketing Agent, and the Bondholders any right, remedy or
claim under or with respect to this Indenture.
Section 13.05. Severability. If any provision of this Indenture
shall be determined to be unenforceable, that shall not affect any other
provision of this Indenture.
Section 13.06. Payments Due on Non-Business Days. If a payment date
is not a Business Day at the place of payment, then payment may be made at
that place on the next Business Day, and no interest shall accrue for the
intervening period.
Section 13.07. Governing Law. This Indenture shall be governed
exclusively by and construed in accordance with the applicable laws of the
State.
Section 13.08. Captions. The captions in this Indenture are for
convenience only and do not define or limit the scope or intent of any
provisions or Sections of this Indenture.
Section 13.09. No Recourse Against Issuer's Officers. No member,
director, officer, agent, or employee of the Issuer shall be individually or
personally liable for any payment on the Bonds or be subject to any personal
liability or accountability by reason of the issuance of the Bonds, but this
Section shall not relieve any such officer, director, member, agent, or
employee from the performance of any official duty provided by law or this
Indenture.
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Section 13.10. Limitation of Liability. Notwithstanding anything
contained in this Indenture to the contrary, the Bonds shall be limited
obligations of the Issuer and shall be payable solely from the revenues and
receipts and other amounts received by or on behalf of the Issuer pursuant to
the Agreement or the First Mortgage Bonds.
Section 13.11. Counterparts. This Indenture may be signed in several
counterparts. Each will be an original, but all of them together constitute
the same instrument.
41
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IN WITNESS WHEREOF, The Industrial Development Board of the Town of
Columbia has caused this Indenture to be signed in its name and its seal to be
hereunto affixed and attested by its duly authorized officers, respectively,
and SouthTrust Bank of Alabama, National Association, to evidence its
acceptance of the trust created hereunder, has caused this Indenture to be
signed in its name and its seal to be hereunto affixed and attested by its
duly authorized officers, respectively, all as of the day and year first above
written.
THE INDUSTRIAL DEVELOPMENT BOARD OF THE
TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
ATTEST:
Secretary
SOUTHTRUST BANK OF ALABAMA, NATIONAL
ASSOCIATION, as Trustee
[SEAL]
By:
Title:
ATTEST:
By:
Title:
42
<PAGE>
EXHIBIT A
[FORM OF BOND]
UNITED STATES OF AMERICA
STATE OF ALABAMA
No. __________ $
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
POLLUTION CONTROL REVENUE REFUNDING BOND, 1995 SERIES C
(ALABAMA POWER COMPANY PROJECT)
TYPE OF INTEREST
MATURITY DATE DATED DATE CUSIP RATE PERIOD
October 1, 2022 October 3, 1995 197210 AM9 Daily
REGISTERED OWNER:
PRINCIPAL AMOUNT:
The Industrial Development Board of the Town of Columbia (the "Issuer"),
a public corporation organized and existing under the laws of the State of
Alabama, hereby promises to pay, solely from the sources described in this
Bond, to the Registered Owner identified above, or registered assigns, on the
Maturity Date stated above (or if this Bond is called for earlier redemption
as described herein, on the redemption date) the principal amount identified
above and to pay interest as provided in this Bond.
1. Indenture; Agreement. This Bond is one of the bonds (the
"Bonds"), limited to $28,000,000 in principal amount, issued under the
Indenture of Trust dated as of October 1, 1995 (the "Indenture"), between the
Issuer and SouthTrust Bank of Alabama, National Association, as trustee (the
"Trustee"). The terms of the Bonds include those in the Indenture.
Bondholders are referred to the Indenture for a statement of those terms.
When used with reference to the Bonds, the term "principal" includes any
premium payable on those Bonds. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to them in the Indenture.
A-43
<PAGE>
The Issuer has sold certain air and water pollution control and sewage
treatment and disposal facilities (the "Project") located at the Farley Plant
(the "Plant") of Alabama Power Company (the "Company") to the Company pursuant
to an Installment Sale Agreement dated as of May 1, 1978, between the Issuer
and the Company, as heretofore supplemented and amended, including a Fourth
Supplementary Installment Sale Agreement dated as of October 1, 1995 (the
"Agreement"). Under the Agreement, Company is obligated to pay to the Issuer
amounts sufficient to pay all amounts coming due on the Bonds and other
expenses incurred in connection therewith, and the Issuer has assigned its
rights to such payments under the Agreement to the Trustee as security for the
Bonds. The proceeds of the Bonds will be used to refund certain outstanding
revenue bonds issued to finance and refinance the Project.
The Indenture and the Agreement may be amended, and references to them
include any amendments.
The Issuer has established a book-entry only system of registration for
the Bonds (the "Book-Entry System"). Except as specifically provided
otherwise in the Indenture, a Securities Depository (or its nominee) will be
the registered owner of this Bond. By acceptance of a confirmation of
purchase, delivery or transfer, the Beneficial Owner (if any) of this Bond
shall be deemed to have agreed to this arrangement. If the Securities
Depository (or its nominee) is the registered owner of this Bond, it shall be
treated as the owner of it for all purposes.
2. Source of Payments. The principal or purchase price of, premium,
if any, and interest on the Bonds are limited obligations of the Issuer and,
as provided in the Indenture, are payable solely and only from payments
derived from the sale of the Project to the Company under the Agreement and
from any other moneys held by the Trustee under the Indenture for such
purpose. The Bonds shall not in any respect be a general obligation of the
Issuer, nor shall they be an obligation of the Town of Columbia, Alabama or
the State of Alabama. Neither the faith and credit nor the taxing power of
the Town of Columbia, Alabama, the State of Alabama or any political
subdivision thereof, is pledged to the payment of the principal of the Bonds
or the interest thereon or other costs incident thereto.
3. Interest Rate. Interest on this Bond will be paid at the lesser
of (a) a Daily Rate, a Weekly Rate, a Commercial Paper Rate, or a Long-Term
Interest Rate as selected by the Company and as determined in accordance with
the Indenture and (b) 10%. Interest will initially be payable at a Daily Rate
as set forth in the Indenture. The Company may change the interest rate
determination method from time to time. A change in the method will result in
mandatory redemption of the Bonds (see "Redemption" below). While there
exists an Event of Default under the Indenture, the interest rate on the Bonds
will be the rate on the Bonds on the day before the Event of Default occurred,
except that if interest on any Bond was then payable at a Commercial Paper
Rate, the default rate for all Bonds then bearing interest at a Commercial
Paper Rate will be the highest Commercial Paper Rate then in effect for any
Bond.
A-44
<PAGE>
When interest is payable at a Daily, Weekly or Commercial Paper Rate, it
will be computed on the basis of the actual number of days elapsed over a year
of 365 days (366 in leap years), and when payable at a Long-Term Interest Rate
on the basis of a 360-day year of twelve 30-day months. Interest on overdue
principal and, to the extent lawful, on overdue premium and interest will be
payable at the rate on the Bonds on the day before the default occurred.
4. Interest Payment and Record Dates. Interest will accrue on the
unpaid portion of the principal of this Bond from the last date to which
interest was paid, or if no interest has been paid, from the date of the
original issuance of the Bonds until the entire principal amount of this Bond
is paid. When interest is payable at the rate in the first column below,
interest accrued during the period (an "Interest Period") shown in the second
column will be paid on the date (an "Interest Payment Date") in the third
column to holders of record on the date (a "Record Date") in the fourth
column:
INTEREST ACCRUAL INTEREST
RATE PERIOD PAYMENT DATE RECORD DATE
Daily* Calendar month Fifth Business Last Business
Day Day
of the next of the month
month
Weekly* Calendar month First Business Last Business
Day Day
of the next before Interest
month Payment Date
*If there shall be a change from a Daily Rate or a Weekly Rate on a day
other than the first day of a calendar month, the then current Interest Period
relating to such Daily Rate or Weekly Rate shall end on the day immediately
preceding the date on which the new interest rate on the Bonds shall become
effective, which date in the case of a change from a Weekly Rate, shall be the
Interest Payment Date for such Interest Period, for which the Record Date
shall be the immediately preceding Business Day; but in the case of a change
from a Daily Rate, the Interest Payment Date for such Interest Period shall be
the fifth Business Day after the last day of such Interest Period, for which
the Record Date shall be the last Business Day of such Interest Period. If
such new interest rate shall be a Daily Rate or a Weekly Rate, the first
Interest Period relatIng thereto shall begin on the effective date of such new
interest rate and end on the last day of the then current calendar month, for
which the Interest Payment Date and the Record Date shall be as prescribed in
this Table.
A-45
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Commercial Paper From 1 to 365 days Day after the Last Business
as determined for last Day
each Bond pursuant to day of before Interest
Section 2.02(a)(3) of Commercial Payment Date
the Indenture Paper Period
("Commercial Paper
Period")
Long-Term** Six-month period or Next day (April Fifteenth of the
portion thereof 1 month before the
ending on the last or October 1) Interest Payment
day Date (March 15
of March or September or
September
15)***
"Business Day" is defined in the Indenture. Payment of defaulted interest
will be made to holders of record as of the fifth-to-last Business Day before
payment.
5. Method of Payment. Holders must surrender Bonds to the Trustee to
collect principal at maturity or upon redemption. (See "Tenders" below for
the payment of purchase price of tendered Bonds.) Interest on Bonds bearing
interest at a Commercial Paper Rate is payable only upon presentation of such
Bonds to the Trustee. Interest on Bonds bearing interest at a Daily, Weekly,
or Long-Term Interest Rate will be paid to the registered holder hereof as of
the Record Date by check mailed by first-class mail on the Interest Payment
Date to such holder's registered address. A holder of $1,000,000 or more in
principal amount of Bonds may be paid interest at a Daily, Weekly or
**If there shall be a change from a Long-Term Interest Rate on a day
other than the day after the last day of the then current Long-Term Interest
Rate Period, or if there shall be an early termination of such Long-Term
Interest Rate Period and a new Long-Term Interest Rate shall be set, such
Long-Term Interest Rate Period shall end on the day immediately preceding the
date on which the new interest rate shall become effective, which date shall
be the Interest Payment Date for such Long-Term Interest Rate Period, for
which the Record Date shall be 15 days prior to such Interest Payment Date or,
if sooner, the first day of such Long-Term Interest Rate Period. If such new
interest rate shall be a Daily Rate or a Weekly Rate, the first Interest
Period relating thereto shall begin on the effective date of such new interest
rate and end on the last day of the then current calendar month, for which the
Interest Payment Date and the Record Date shall be prescribed in this Table.
***If an Interest Payment Date occurs less than 15 days after the first
day of a Long-Term Interest Rate Period, the first day of such Long-Term
Interest Rate Period is the Record Date for such interest Payment Date.
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<PAGE>
Commercial Paper Rate by wire transfer in immediately available funds to an
account in the continental United States if the holder makes a written request
of the Trustee (in form satisfactory to the Trustee) at least two Business
Days before the Record Date specifying the account address. The notice may
provide that it will remain in effect for later interest payments until
changed or revoked by another written notice. Principal and interest will be
paid in money of the United States that at the time of payment is legal tender
for payment of public and private debts or by checks or wire transfers payable
in such money. If any payment on the Bonds is due on a non-Business Day, it
will be made on the next Business Day, and no interest will accrue as a
result.
6. Tenders. "Tender" means to require, or the act of requiring, the
Trustee to purchase a Bond at the holder's option under the provisions of this
Section 6 at 100% of the principal amount plus interest accrued to the date of
purchase. During a Daily Rate Period, if a Bond is tendered after the Record
Date and before the Interest Payment Date for that Interest Period, the
Trustee will pay a purchase price of principal plus interest accruing after
the last day of that Interest Period. The holder will receive interest for
that Interest Period by check or wire transfer as described in Section 5
above.
Daily Rate Tender. When interest on the Bonds is payable at a
Daily Rate and a Book-Entry System is in effect, a Beneficial Owner
(through its direct Participant in the Securities Depository) may tender
his interest in a Bond (or portion of Bond) by delivering an irrevocable
written notice or an irrevocable telephone notice, promptly confirmed in
writing, to the Trustee (any such telephone notice to be delivered to a
trust officer of the Trustee) and an irrevocable notice by telephone,
telegraph, or facsimile transmission to the Remarketing Agent, in each
case by 11:00 a.m., New York City time, on a Business Day, stating the
principal amount of the Bond (or portion of Bond being tendered),
payment instructions for the purchase price and the Business Day (which
may be the date the notice is delivered) the Bond (or portion of Bond)
is to be purchased. The Beneficial Owner shall effect delivery of such
Bonds by causing such direct Participant to transfer its interest in the
Bonds equal to such Beneficial Owner's interest on the records of the
Securities Depository to the participant account of the Trustee with the
Securities Depository. Any notice received by the Trustee after 11:00
a.m., New York City time, shall be deemed to have been given on the next
Business Day.
When interest on the Bonds is payable at a Daily Rate and a Book-
Entry System is not in effect, a holder of a Bond may tender the Bond
(or portion of Bond) by delivering the notices as described above (which
shall include the certificate number of the Bond), and shall also
deliver the Bond to the Trustee by 1:00 p.m., New York City time, on the
date of purchase (see additional requirements below).
Weekly Rate Tender. When interest on the Bonds is payable at a
Weekly Rate and a Book-Entry System is in effect, a Beneficial Owner
(through its direct Participant in the Securities Depository) may tender
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<PAGE>
his interest in a Bond (or portion of Bond) by delivering an irrevocable
written notice or an irrevocable telephone notice, promptly confirmed in
writing, to the Trustee (any such telephone notice to be delivered to a
trust officer of the Trustee) and an irrevocable notice by telephone,
telegraph, or facsimile transmission to the Remarketing Agent, in each
case prior to 5:00 p.m., New York City time on a Business Day stating
the principal amount of the Bond (or portion of Bond) being tendered,
payment instructions for the purchase price, and the date, which must be
a Business Day at least seven days after the notice is delivered, on
which the Bond (or portion of Bond) is to be purchased. The Beneficial
Owner shall effect delivery of such Bonds by causing such direct
Participant to transfer its interest in the Bonds equal to such
Beneficial Owner's interest on the records of the Securities Depository
to the participant account of the Trustee with the Securities
Depository.
When interest on the Bonds is payable at a Weekly Rate and a Book-
Entry System is not in effect, a holder of a Bond may tender the Bond
(or portion of Bond) by delivering the notices as described above (which
shall include the certificate number of the Bond), and shall also
deliver the Bond to the Trustee by 1:00 p.m., New York City time, on the
date of purchase (see additional requirements below).
Payment of Purchase Price. The purchase price for a tendered Bond will
be paid in immediately available funds to the registered owner of the Bond by
the close of business on the date of purchase.
7. Delivery Address; Additional Delivery Requirements. Notices in
respect of tenders and Bonds tendered must be delivered to the Trustee as
follows:
SouthTrust Bank of Alabama, National Association
P. O. Box 2554
Birmingham, Alabama 35290
Attention: Corporate Trust Department
Telephone: (205) 254-5017
Fax: (205) 254-4180
Notices in respect of tenders shall be delivered to the Remarketing
Agent as follows:
Lehman Brothers
200 Vesey Street, 8th Floor
New York, New York 10285
Attention: Municipal Note Desk
Telephone: (212) 558-1022
Fax: (212) 528-2129
The delivery addresses or telephone numbers of the Trustee or the Remarketing
Agent may be changed by notice mailed by first class mail to the Bondholders
at their registered addresses.
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All tendered Bonds must be accompanied by an instrument of transfer
satisfactory to the Trustee, executed in blank by the registered owner or his
duly authorized attorney, with the signature guaranteed by an eligible
guarantor institution.
Limitation on Tenders. No Bonds may be tendered while they bear
interest at a Commercial Paper Rate or a Long-Term Interest Rate.
Irrevocable Notice Deemed to be Tender of Bond; Undelivered Bonds. The
giving of notice by an owner of a Bond as provided in Section 6 constitutes
the irrevocable tender for purchase of each Bond (or portion thereof) with
respect to which such notice was given, irrespective of whether such Bond was
delivered as provided in Section 6. The determination of the Trustee as to
whether a notice of tender has been properly delivered shall be conclusive and
binding upon the Bondholders.
The Trustee may refuse to accept delivery of any Bond for which a proper
instrument of transfer has not been provided. If any owner of a Bond who gave
notice fails to deliver his Bond to the Trustee at the place and on the
applicable date and time specified, or fails to deliver his Bond properly
endorsed, his Bond shall constitute an undelivered Bond as described in
Section 2.06 of the Indenture. BY ACCEPTANCE OF THIS BOND, THE OWNER AGREES
TO SELL AND SURRENDER THIS BOND, PROPERLY ENDORSED, TO THE TRUSTEE AFTER THE
GIVING OF IRREVOCABLE NOTICE OF TENDER FOR PURCHASE AS DESCRIBED ABOVE.
8. Redemptions. As provided below, the Company has the right to
purchase Bonds in lieu of certain redemptions. BY ACCEPTANCE OF THIS BOND,
THE OWNER AGREES TO SELL AND SURRENDER THIS BOND, PROPERLY ENDORSED, TO THE
COMPANY IN LIEU OF REDEMPTION UNDER THE CONDITIONS DESCRIBED BELOW. All
redemptions and purchases in lieu of redemption will be made in funds
immediately available on the redemption or purchase date and will be at a
redemption or purchase price of 100% of the principal amount of the Bonds
being redeemed or purchased (unless a premium is required as provided below)
plus interest accrued to the redemption or purchase date, except that interest
accruing at a Daily Rate will be paid on the fifth Business Day following the
redemption or purchase date. Bonds tendered for purchase on a date after a
call for redemption but before the redemption date will be purchased pursuant
to the tender. No purchase of Bonds by the Company or advance use of any
funds to effectuate any such purchase shall be deemed to be a payment or
redemption of the Bonds or of any portion thereof and such purchase will not
operate to extinguish or discharge the indebtedness evidenced by such Bonds.
Optional Redemption at a Premium During Long-Term Interest Rate Period.
During any Long-Term Interest Rate Period of less than or equal to five years,
the Bonds will not be redeemable pursuant to this provision during the Long-
Term Interest Rate Period.
If the Long-Term Interest Rate Period is greater than five years, the
Bonds will not be redeemable for five years after the date on which the Bonds
begin to bear interest at the Long-Term Interest Rate. After the five year
no-call period, the Bonds may be redeemed at any time in whole or in part at
102% of their principal amount. The premium will decline every year on the
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anniversary of the date on which the Bonds begin to bear interest at the Long-
Term Interest Rate, by one percentage point until the Bonds are redeemable
without premium.
As an alternative to and in lieu of the foregoing redemption provisions
if, with respect to any Long-Term Interest Rate Period, a Favorable Opinion of
Tax Counsel is delivered to the Trustee not later than the date of the
establishment of such Long-Term Interest Rate Period, the Bonds may be
redeemed during such Long-Term Interest Rate Period at the option of the
Company in whole or in part at any time after a no-call period, if any,
established by the Remarketing Agent, at the percentages of their principal
amount, plus accrued interest, as follows: The Remarketing Agent shall, given
the duration of the Long-Term Interest Rate Period, determine and inform the
Trustee, on a date which is no later than the establishment of the Long-Term
Interest Rate, the periods during which the Bonds shall not be subject to
redemption (the "Call Protection Period"), the redemption premium or premiums
(the "Call Premiums"), if any, applicable to the redemption of Bonds after the
Call Protection Period, and the period or periods during which the Call
Premiums shall be effective (the "Call Premium Periods") necessary to
establish the Long-Term Interest Rate. Such Call Protection Period, Call
Premiums and Call Premium Periods shall be established in accordance with
optional call redemption provisions which in the judgment of the Remarketing
Agent, are generally accepted as the standard features for obligations such as
the Bonds, given the length of the Long-Term Interest Rate Period.
Extraordinary Optional Redemption. The Bonds may be redeemed in whole
at the option of the Company at any time after the occurrence of any of the
following:
(a) Damage or destruction to the Plant or the Project to such
extent that in the opinion of the Company's board of directors
(expressed in a resolution) filed with the Issuer and the Trustee: (1)
the Plant or the Project, as the case may be, cannot be reasonably
repaired, rebuilt or restored within a period of six months to their
condition immediately preceding such damage or destruction, or (2) the
Company is thereby prevented from carrying on its normal operations at
the Plant for a period of six months.
(b) Loss of title to or use of a substantial part of the Plant
or the Project as a result of the exercise of the power of eminent
domain which, in the opinion of the Company's board of directors
(expressed in a resolution) filed with the Issuer and the Trustee,
results or is likely to result in the Company being thereby prevented
from carrying on its normal operations therein for a period of six
months.
(c) Any event occurs which, in the opinion of the Company's
board of directors (expressed in a resolution), renders the Project or
the Plant so uneconomical that it is abandoned.
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<PAGE>
Any such redemption shall be on any date within 90 days from the time
the Company files the required resolution and directs that the Bonds are to be
redeemed, which direction must be given, if at all, within 180 days following
the occurrence of one of the events listed above.
Optional Redemption During Daily or Weekly Rate Period. When interest
on the Bonds is payable at a Daily or Weekly Rate, the Bonds may be redeemed
in whole or in part at the option of the Company, on any Business Day.
Mandatory Redemption at Beginning of a New Long-Term Interest Rate
Period. When the Bonds bear interest at a Long-Term Interest Rate and a new
Long-Term Interest Rate is to be determined, the Bonds will be redeemed or
purchased by the Company in lieu of redemption on the effective date of the
new Long-Term Interest Rate. In the case of a change prior to the day
originally established as the day after the last day of a Long-Term Interest
Rate Period, the Bonds will be redeemed or purchased at the percentage of
their principal amount which would be payable upon the applicable redemption
described under "Optional Redemption at a Premium During Long-Term Interest
Rate Period" above.
Mandatory Redemption on Each Interest Payment Date During Commercial
Paper Mode. When Bonds bear interest at a Commercial Paper Rate, each Bond
will be redeemed or purchased by the Company in lieu of redemption on the
Interest Payment Date for such Bond. If Bonds are scheduled to be redeemed
under the following paragraph, the Bonds will be called under, and redemption
will be governed by, that paragraph and not this paragraph.
Mandatory Redemption Upon a Change in the Method of Determining the
Interest Rate on the Bonds. On the effective date of the change in the method
of determining the interest rate on the Bonds (the four methods being Daily,
Weekly, Commercial Paper, or Long-Term Interest Rates) the Bonds will be
redeemed or purchased by the Company in lieu of redemption on the effective
date of such change. Any such redemption or purchase shall be at a price
equal to 100% of the principal amount of the Bonds, except that in the case of
a change prior to the day originally established as the day after the last day
of a Long-Term Interest Rate Period, the Bonds will be redeemed or purchased
at the percentage of their principal amount which would be payable upon the
applicable redemption described under "Optional Redemption at a Premium During
Long-Term Interest Rate Period" above.
Notice of Redemption. At least 30 days before each redemption except
"Mandatory Redemption on Each Interest Payment Date During Commercial Paper
Mode" described above, the Trustee will mail a notice of redemption by first-
class mail to each Bondholder at the holder's registered address. Failure to
give any required notice of redemption as to any particular Bonds will not
affect the validity of the call for redemption of any Bonds in respect of
which no failure occurs. Any notice mailed as provided in this paragraph
shall be effective when sent and will be conclusively presumed to have been
given whether or not actually received by the addressee.
Effect of Notice of Redemption. When notice of redemption is required
and given, and when Bonds are to be redeemed without notice, Bonds called for
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<PAGE>
redemption become due and payable on the redemption date at the applicable
redemption price, subject to the Company's right to purchase Bonds as provided
above; in such case when funds are deposited with the Trustee sufficient for
redemption or for purchase, interest on the Bonds to be redeemed or purchased
ceases to accrue as of the date of redemption or purchase.
9. Denominations; Transfer; Exchange. The Bonds are in registered
form without coupons in denominations as follows: (1) when interest is
payable at a Daily, Weekly, or Commercial Paper Rate, $100,000 or any integral
multiple thereof; and (2) when interest is payable at a Long-Term Interest
Rate, $5,000 and integral multiples of $5,000 thereafter. A holder may
transfer or exchange Bonds in accordance with the Indenture. The Trustee may
require a holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted
by the Indenture. Except in connection with the purchase of Bonds tendered
for purchase or purchased in lieu of redemption, the Trustee will not be
required to transfer or exchange any Bond which has been called for redemption
or during the period beginning 15 days before the mailing of notice calling
the Bonds or any portion of the Bonds for redemption and ending on the
redemption date.
10. Persons Deemed Owners. The registered holder of this Bond may be
treated as the owner of it for all purposes.
11. Unclaimed Money. If money for the payment of principal, premium,
interest, or purchase price remains unclaimed for five years, the Trustee will
pay the money to or for the account of the Company. After that, holders
entitled to the money must look only to the Company and not to the Trustee or
the Issuer for payment unless an abandoned property law designates another
person.
12. Discharge Before Redemption or Maturity. If the Company at any
time deposits with the Trustee money or Government Obligations as described in
the Indenture sufficient to pay at redemption or maturity principal of and
interest on the outstanding Bonds, and if the Company also pays all other sums
then payable by the Company under the Indenture, the lien of the Indenture
will be discharged. After discharge, Bondholders must look only to the
deposited money and securities for payment. Government Obligations are
securities backed by the faith and credit of the United States or securities
evidencing ownership interest in such full-faith and credit securities.
13. Amendment, Supplement, Waiver. Subject to certain exceptions, the
Indenture, the Agreement, or the Bonds may be amended or supplemented, and any
past default or compliance with any provision may be waived, with the consent
of the holders of a majority in principal amount of the Bonds then
outstanding. Any such consent shall be Irrevocable and shall bind any
subsequent owner of this Bond or any Bond delivered in substitution for this
Bond. Without the consent of any Bondholder, the Issuer may amend or
supplement the Indenture, the Agreement, or the Bonds as described in the
Indenture, among other things, to cure any ambiguity, omission, defect, or
inconsistency, to provide for uncertificated Bonds in addition to or in place
of certificated Bonds, to provide for a Book-Entry System for the Bonds or to
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make any change that does not materially adversely affect the rights of any
Bondholder.
14. Defaults and Remedies. The Indenture provides that the
occurrences of certain events constitute Events of Default. If an Event of
Default relating to payment of principal of, interest on, or purchase price of
the Bonds occurs and is continuing, the Bonds shall without further action
become immediately due and payable. Whenever any other Event of Default
occurs and is continuing, the Bonds shall without further action become due
and payable immediately. An Event of Default and its consequences may be
waived as provided in the Indenture. Bondholders may not enforce the
Indenture or the Bonds except as provided in the Indenture. Except as
specifically provided in the Indenture, the Trustee may refuse to enforce the
Indenture or the Bonds unless it receives indemnity satisfactory to it.
Subject to certain limitations, holders of a majority in principal amount of
the Bonds then outstanding may direct the Trustee in its exercise of any trust
or power.
15. No Recourse Against Others. A member, director, officer, or
employee, as such, of the Issuer shall not have any liability for any
obligations of the Issuer or the Company under the Bonds or the Indenture or
for any claim based on such obligations or their creation. Each Bondholder by
accepting a Bond waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Bond.
16. Authentication. This Bond shall not be valid until the Trustee
signs the certificate of authentication.
17. Abbreviations. Customary abbreviations may be used in the name of
a Bondholder or an assignee, such as TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform
Gifts to Minors Act).
A copy of the Indenture may be inspected at the corporate trust office
of the Trustee located at 100 Office Park Circle, Birmingham, Alabama 35223.
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts, conditions,
and things required to exist, happen, and be performed precedent to and in the
execution and delivery of the Indenture and the issuance of this Bond do
exist, have happened and have been performed in due time, form, and manner as
required by law.
This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Indenture until the certificate
of authentication hereon shall have been duly executed by the Trustee.
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IN WITNESS WHEREOF The Industrial Development Board of the Town of
Columbia has caused this Bond to be executed in its name by the Chairman or
Vice Chairman of its Board of Directors by his manual or facsimile signature
and attested by the manual or facsimile signature of its Secretary or
Assistant and its corporate seal to be hereunto affixed or printed hereon.
Date of Authentication: ,
THE INDUSTRIAL DEVELOPMENT BOARD OF
TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
Attest:
Secretary
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION
Trustee, certifies that this is one of the
Bonds referred to in the Indenture
By:
Authorized Signature
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<PAGE>
The following abbreviations, when used in the inscription on the face of the
within Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM- as tenants in UNIF GIFT MIN ACT - Custodian
common (Cust) (Minor)
TEN ENT- as tenants by the under Uniform Gifts to Minors Act
entireties
JT TEN- as joint
tenants (State)
with right of
survivorship
and not as tenants
in common
Additional abbreviations may also be used though not in list above.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Name and Address of Assignee)
the within Bond and does hereby irrevocably constitute and appoint
attorney to transfer the said Bond on the books kept for registration thereof
with full power of substitution in the premises.
Dated:
Signature guaranteed:
NOTICE: The signature to this
Medallion Number: assignment must correspond with the
*Signature(s) must be guaranteed by name of the registered owner as it
an eligible guarantor institution appears upon the face of the within
which is a member of a recognized Bond in every particular, without
signature guarantee program, i.e., alteration or enlargement or any
Securities Transfer Agents Medallion change whatever.
Program (STAMP), or New York Stock
Exchange Medallion Signature Program
(MSP).
A-55
<PAGE>
Exhibit E
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
to
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION,
as Trustee
INDENTURE OF TRUST
Dated as of October 1, 1995
Relating to
$27,000,000
Pollution Control Revenue Refunding Bonds, 1995 Series D
(Alabama Power Company Project)
<PAGE>
TABLE OF CONTENTS
GRANTING CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION . . . . . . . 4
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . 4
Section 1.02. Rules of Construction . . . . . . . . . . . . . . 8
ARTICLE II
THE BONDS . . . . . . . . . . . . . . 8
Section 2.02. Interest on the Bonds . . . . . . . . . . . . . . 9
Section 2.03. Execution and Authentication . . . . . . . . . . 16
Section 2.04. Bond Register . . . . . . . . . . . . . . . . . . 16
Section 2.05. Registration and Exchange of Bonds; Persons
Treated as Owners . . . . . . . . . . . . . . . . 16
Section 2.06. Mutilated, Lost, Stolen, Destroyed or Undeliv-
ered Bonds . . . . . . . . . . . . . . . . . . . 17
Section 2.07. Cancellation of Bonds . . . . . . . . . . . . . . 17
Section 2.08. Temporary Bonds . . . . . . . . . . . . . . . . . 17
ARTICLE III
REDEMPTION, PURCHASES IN LIEU OF REDEMPTION AND REMARKETING . . 18
Section 3.01. Notices to Trustee . . . . . . . . . . . . . . . 18
Section 3.02. Redemption Dates . . . . . . . . . . . . . . . . 18
Section 3.03. Selection of Bonds to Be Redeemed . . . . . . . . 18
Section 3.04. Redemption Notices . . . . . . . . . . . . . . . 18
Section 3.05. Payment of Bonds Called for Redemption . . . . . 20
Section 3.06. Bonds Redeemed in Part . . . . . . . . . . . . . 20
Section 3.07. Purchase of Bonds in Lieu of Redemption . . . . . 20
Section 3.08. Disposition of Purchased Bonds . . . . . . . . . 20
ARTICLE IV
APPLICATION OF PROCEEDS AND PAYMENT OF BONDS . . . . . 22
Section 4.01. Application of Proceeds . . . . . . . . . . . . . 22
Section 4.02. Payments of Bonds . . . . . . . . . . . . . . . . 23
Section 4.03. Investments of Moneys . . . . . . . . . . . . . . 23
Section 4.04. Moneys Held in Trust . . . . . . . . . . . . . . 23
ARTICLE V
BOOK-ENTRY SYSTEM . . . . . . . . . . . . 24
Section 5.01. Book-Entry System . . . . . . . . . . . . . . . . 24
ARTICLE VI
COVENANTS . . . . . . . . . . . . . . 25
i
<PAGE>
Section 6.01. Payment of Bonds . . . . . . . . . . . . . . . . 25
Section 6.02. Recording and Filing; Further Assurances . . . . 26
Section 6.03. Tax Covenants . . . . . . . . . . . . . . . . . . 26
Section 6.04. Termination of Subordinated Security Interest . . 27
ARTICLE VII
DISCHARGE OF INDENTURE . . . . . . . . . . . 27
Section 7.01. Bonds Deemed Paid; Discharge of Indenture . . . . 27
Section 7.02. Application of Trust Money . . . . . . . . . . . 28
Section 7.03. Repayment to Company . . . . . . . . . . . . . . 28
ARTICLE VIII
DEFAULTS AND REMEDIES . . . . . . . . . . . 28
Section 8.01. Events of Default . . . . . . . . . . . . . . . . 28
Section 8.02. Acceleration . . . . . . . . . . . . . . . . . . 28
Section 8.03. Other Remedies . . . . . . . . . . . . . . . . . 28
Section 8.04. Waiver of Past Defaults . . . . . . . . . . . . . 29
Section 8.05. Control by Majority . . . . . . . . . . . . . . . 29
Section 8.06. Limitation on Suits . . . . . . . . . . . . . . . 29
Section 8.07. Rights of Holders to Receive Payment . . . . . . 29
Section 8.08. Collection Suit by Trustee . . . . . . . . . . . 30
Section 8.09. Trustee May File Proofs of Claim . . . . . . . . 30
Section 8.10. Priorities . . . . . . . . . . . . . . . . . . . 30
Section 8.11. Undertaking for Costs . . . . . . . . . . . . . . 30
ARTICLE IX
TRUSTEE AND REMARKETING AGENT . . . . . . . . . 31
Section 9.01. Duties of Trustee . . . . . . . . . . . . . . . . 31
Section 9.02. Rights of Trustee . . . . . . . . . . . . . . . . 32
Section 9.03. Individual Rights of Trustee . . . . . . . . . . 32
Section 9.04. Trustee's Disclaimer . . . . . . . . . . . . . . 32
Section 9.05. Notice of Defaults . . . . . . . . . . . . . . . 32
Section 9.06. Compensation and Indemnity of Trustee . . . . . . 32
Section 9.07. Eligibility of Trustee . . . . . . . . . . . . . 33
Section 9.08. Replacement of Trustee . . . . . . . . . . . . . 33
Section 9.09. Acceptance of Trust by Successor Trustee . . . . 34
Section 9.10. [reserved] . . . . . . . . . . . . . . . . . . . 35
Section 9.11. Duties of Remarketing Agent . . . . . . . . . . . 35
Section 9.12. Eligibility of Remarketing Agent . . . . . . . . 35
Section 9.13. Replacement of Remarketing Agent . . . . . . . . 35
Section 9.14. Compensation of Remarketing Agent . . . . . . . . 36
Section 9.15. Successor Trustee or Remarketing Agent by
Merger . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE X
AMENDMENTS OF AND SUPPLEMENTS TO INDENTURE . . . . . . 36
Section 10.01. Without Consent of Bondholders . . . . . . . . . 36
Section 10.02. With Consent of Bondholders . . . . . . . . . . . 37
ii
<PAGE>
Section 10.03. Effect of Consents . . . . . . . . . . . . . . . 37
Section 10.04. Notation on or Exchange of Bonds . . . . . . . . 37
Section 10.05. Signing by Trustee of Amendments and
Supplements . . . . . . . . . . . . . . . . . . . 37
Section 10.06. Company Consent Required . . . . . . . . . . . . 38
Section 10.07. Notice to Bondholders . . . . . . . . . . . . . . 38
ARTICLE XI
AMENDMENTS OF AND SUPPLEMENTS TO THE AGREEMENT . . . . . 38
Section 11.01. Without Consent of Bondholders . . . . . . . . . 38
Section 11.02. With Consent of Bondholders . . . . . . . . . . . 38
Section 11.03. Consents by Trustee to Amendments or
Supplements . . . . . . . . . . . . . . . . . . . 38
ARTICLE XII
[reserved] . . . . . . . . . . . . . . 39
ARTICLE XIII
MISCELLANEOUS . . . . . . . . . . . . . 39
Section 13.01. Notices . . . . . . . . . . . . . . . . . . . . . 39
Section 13.02. Bondholders' Consents . . . . . . . . . . . . . . 39
Section 13.03. Appointment of Separate Paying Agent and/or
Tender Agent . . . . . . . . . . . . . . . . . . 40
Section 13.04. Limitation of Rights . . . . . . . . . . . . . . 40
Section 13.05. Severability . . . . . . . . . . . . . . . . . . 40
Section 13.06. Payments Due on Non-Business Days . . . . . . . . 40
Section 13.07. Governing Law . . . . . . . . . . . . . . . . . . 40
Section 13.08. Captions . . . . . . . . . . . . . . . . . . . . 40
Section 13.09. No Recourse Against Issuer's Officers . . . . . . 40
Section 13.10. Limitation of Liability . . . . . . . . . . . . . 41
Section 13.11. Counterparts . . . . . . . . . . . . . . . . . . 41
EXHIBIT A . . . . . . . . . . . . . . . . . . . . . . . . . . Form of Bond
iii
<PAGE>
INDENTURE OF TRUST
THIS INDENTURE OF TRUST made and entered into as of October 1, 1995, by
and between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF COLUMBIA, a public
corporation organized and existing under the laws of the State of Alabama (the
"Issuer"), and SOUTHTRUST BANK OF ALABAMA, NATIONAL ASSOCIATION, a national
banking association 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");
W I T N E S S E T H:
WHEREAS, under Act No. 648 enacted at the 1949 Regular Session of the
Alabama Legislature, as heretofore amended and supplemented by Act No. 1893
enacted at the 1971 Regular Session of the Alabama Legislature and Act No. 510
enacted at the 1982 Regular Session of the Alabama Legislature (Act No. 648,
as amended and supplemented, being herein called the "Act") the Issuer has the
following, among other powers:
(a) to acquire, whether by construction, purchase, exchange,
gift, lease or otherwise, and to enlarge, improve, replace, equip and
maintain, one or more pollution control facilities, including all real
and personal property deemed necessary or desirable in connection
therewith,
(b) to issue its revenue bonds to pay the cost of pollution
control facilities, such bonds to be payable solely from the revenues
and receipts derived from the leasing or sale by the Issuer of such
pollution control facilities,
(c) to lease or sell to others and otherwise dispose of all or
any portion of such pollution control facilities, and
(d) to issue its refunding bonds for the purpose of paying the
principal of, premium, if any, and accrued interest on, its outstanding
revenue bonds;
WHEREAS, in order to promote the health, safety and prosperity of the
citizens of the State of Alabama through the protection of its air and water
resources, the Issuer has undertaken to acquire, construct, install, equip and
sell to Alabama Power Company (the "Company") facilities or portions thereof,
designed for the abatement or control of air and water pollution, and the
disposal of sewage and solid wastes at the Company's Joseph M. Farley Nuclear
Plant, which is located within the geographical area of operation of the
Issuer in Houston County, Alabama, which facilities comprise the Project and
are generally described in Exhibit A to the Original Agreement described
below, and in furtherance of the above-mentioned purposes, the Issuer entered
into an Installment Sale Agreement dated as of May 1, 1978 (the "Initial
Agreement"), a First Supplemental Agreement thereto dated as of November 1,
1984, a Second Supplemental Agreement thereto dated as of December 1, 1984, a
Third Supplemental Agreement dated as of June 1, 1985, a Fourth Supplemental
Agreement dated as of December 1, 1985, a Fifth Supplemental Agreement dated
as of December 31, 1985, a Sixth Supplemental Agreement dated as of November
1, 1986 and a Seventh Supplemental Agreement dated as of June 1, 1993 (the
<PAGE>
Initial Agreement, as so supplemented, being hereinafter called the "Original
Agreement"), a Supplementary Installment Sale Agreement dated as of September
1, 1994 (the "First Supplementary Agreement"), a Second Supplementary
Agreement dated as of May 1, 1995 (the "Second Supplementary Agreement"), and
a Third Supplementary Agreement dated as of May 1, 1995 (the "Third
Supplementary Agreement"), with the Company providing for the undertaking by
the Issuer to acquire, construct, install, equip and sell to the Company the
Project;
WHEREAS, the Original Agreement provided that, in order to finance the
Project, the Issuer would issue and sell its Pollution Control Revenue Bonds
(Alabama Power Company Farley Plant Project) in one or more series and that
the Issuer would sell the Project (including improvements with respect to the
Project) to the Company for the purchase price stated in the Original
Agreement;
WHEREAS, in order to finance and refinance a portion of the costs of the
Project, the Issuer has heretofore issued various series of its revenue bonds
including $81,500,000 aggregate principal amount of its Pollution Control
Revenue Refunding Bonds, Series E (Alabama Power Company Farley Plant Project)
(the "Series E Bonds");
WHEREAS, the Issuer and the Company have entered into a Fourth
Supplementary Installment Sale Agreement dated as of October 1, 1995 (the
"Fourth Supplementary Agreement") providing that for the purposes therein set
forth, the Issuer will issue and sell its Pollution Control Revenue Refunding
Bonds, 1995 Series C (Alabama Power Company Project);
WHEREAS, the Issuer and the Company have also entered into a Fifth
Supplementary Installment Sale Agreement dated as of October 1, 1995 (the
"Fifth Supplementary Agreement") providing that for the purposes therein set
forth, the Issuer will issue and sell its Pollution Control Revenue Refunding
Bonds, 1995 Series D (Alabama Power Company Project);
WHEREAS, pursuant to and in accordance with the provisions of the Act,
the Issuer now intends to issue its Pollution Control Revenue Refunding Bonds,
1995 Series D (Alabama Power Company Project) in the aggregate principal
amount of $27,000,000 (the "Bonds") for the purpose of refunding a portion of
the Series E Bonds;
WHEREAS, the execution and delivery of this Indenture of Trust (the
"Indenture"), and the issuance of the Bonds under the Act as herein provided
have been in all respects duly and validly authorized by proceedings duly
passed on and approved by the Issuer;
WHEREAS, all other acts, conditions and things required by the
Constitution and laws of the State of Alabama 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
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<PAGE>
order to make the Agreement a valid and binding agreement in accordance with
its terms;
WHEREAS, the Company has agreed to make installment purchase payments to
the Issuer pursuant to the Agreement in amounts sufficient to pay the
principal, purchase price, premium, if any, and interest on the Bonds, all as
hereinafter defined;
Accordingly, the Issuer and the Trustee agree as follows for the benefit
of each other and for the benefit of the holders of the Bonds issued pursuant
to this Indenture.
GRANTING CLAUSE
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 premiums, if any, thereon and the Purchase Price (hereinafter
defined) therefor 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, 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,
including the Subordinated Security Interest provided for in the Agreement,
and all moneys receivable thereunder, except for the Unassigned Rights, and
all funds held by the Trustee hereunder (other than moneys held for the
purchase of Bonds which have not been presented for payment) as security for
the payment of the Bonds and the fees, charges and expenses of the Trustee as
aforesaid and the satisfaction of any other obligation assumed by the Issuer
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 and purchase price of, premium, if any,
and interest on the Bonds due or to become due thereon, at the times and in
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<PAGE>
the manner mentioned in the Bonds, and shall perform all the covenants and
conditions required of it by this Indenture, and shall pay or cause to be paid
to the Trustee, any additional paying agents and the Remarketing Agent all
sums of money due or to become due to them in accordance with the terms and
provisions hereof, then upon such final payments 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; 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 AND RULES OF CONSTRUCTION
Section 1.01. Definitions. For all purposes of this Indenture,
unless the context requires otherwise, the following terms shall have the
following meanings:
"Act" means Act No. 648 enacted at the 1949 Regular Session of the
Alabama Legislature, as amended from time to time, and presently codified as
Chapter 54 of Title 11 of the Code of Alabama 1975.
"Agreement" means the Fifth Supplementary Installment Sale Agreement
dated as of October 1, 1995, between the Issuer and the Company, as amended
and supplemented from time to time.
"Beneficial Owner" means the purchaser of a beneficial interest in the
Bonds when the Bonds are held by the Securities Depository in the Book-Entry
System, and otherwise means a Bondholder.
"Bondholder" or "holder" means the registered owner of any Bond.
"Bonds" means the Pollution Control Revenue Refunding Bonds, 1995 Series
D (Alabama Power Company Project) issued by the Issuer hereunder in the
aggregate principal amount of $27,000,000.
"Book-Entry System" means the system maintained by the Securities
Depository described in Section 5.01.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii) a
day on which commercial banks in New York, New York, or the city in which the
principal corporate trust office of the Trustee is located, are authorized by
law to close or (iii) a day on which the New York Stock Exchange is closed.
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<PAGE>
"Code" means the Internal Revenue Code of 1986, as amended, and the
Treasury regulations thereunder.
"Commercial Paper Mode" means each period of time, comprised of
Commercial Paper Periods, during which Commercial Paper Rates are in effect.
"Commercial Paper Period" means, with respect to any Bond, each period
set under Section 2.02(a)(3).
"Commercial Paper Rate" means the interest rate on each Bond set under
Section 2.02(a)(3).
"Company" means Alabama Power Company, an Alabama corporation, and its
successors and assigns, and any surviving, resulting or transferee entity as
provided in Section 6.3 of the Agreement.
"Company Representative" means any person at the time designated as such
pursuant to the provisions of Section 6.7 of the Original Agreement by a
written certificate furnished to the Trustee and the Issuer containing the
specimen signature of such person and signed on behalf of the Company by any
of its officers. The certificate may designate an alternate or alternates.
"Credit Agreement" means the Committed Line of Credit Agreement dated
October 3, 1995, between the Company and The Tokai Bank, Limited, arranged by
the Company pursuant to the provisions of Section 3.5 of the Agreement, or any
line of credit or similar facility or facilities that the Company may enter
into in substitution or replacement of such Committed Line of Credit Agreement
from time to time.
"Daily Rate" means an interest rate on the Bonds set under
Section 2.02(a)(l).
"Event of Default" is defined in Section 8.01.
"Favorable Opinion of Tax Counsel" means an Opinion of Tax Counsel
addressed to the Issuer and to the Trustee to the effect that the action
proposed to be taken is permitted by the laws of the State and by this
Indenture and will not adversely affect any exclusion from gross income for
federal income tax purposes of interest on the Bonds.
"Government Obligations" means (i) noncallable direct obligations of the
United States for which its full faith and credit are pledged,
(ii) noncallable obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States, the timely
payment of which is unconditionally guaranteed as a full faith and credit
obligation of the United States, or (iii) securities or receipts evidencing
ownership interests in obligations or specified portions (such as principal or
interest) of obligations described in (i) or (ii).
"Indenture" means this Indenture of Trust, as it may be amended or
supplemented from time to time in accordance with its terms.
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"Interest Payment Date" is defined in the form of the Bonds appearing in
Exhibit A hereto.
"Interest Period" is defined in the form of the Bonds appearing in
Exhibit A hereto.
"J.J. Kenny Index" means, as of any date, the index of 7-day yields on
high grade tax exempt municipal bonds as determined by J.J. Kenny Co., Inc. or
any successor thereto and published on such date (or, if not published on said
date, on the most recent day prior thereto on which such index shall have been
so published).
"Long-Term Interest Rate" means an interest rate on the Bonds set under
Section 2.02(a)(4).
"Long-Term Interest Rate Period" is defined in Section 2.02(a)(4).
"Maturity Date" means the stated maturity for the Bonds as set forth in
Section 2.01.
"1954 Code" means the Internal Revenue Code of 1954, as amended, and the
Treasury regulations thereunder.
"Opinion of Counsel" means a written opinion of counsel who is
acceptable to the Issuer and the Trustee. The counsel may be an employee of
or counsel to the Issuer, the Trustee or the Company.
"Opinion of Tax Counsel" means an Opinion of Counsel by counsel of
nationally recognized standing in matters relating to the exclusion of
interest from gross income on obligations issued by states and their political
subdivisions or agencies.
The term "outstanding" when used with reference to Bonds, or "Bonds
outstanding" means all Bonds which have been authenticated and delivered by
the Trustee under this Indenture, except the following:
a. Bonds canceled or purchased by or delivered to the Trustee
for cancellation.
b. Bonds that have become due (at maturity or on redemption,
acceleration or otherwise) and for the payment, including interest
accrued to the due date, of which sufficient moneys are held by the
Trustee.
c. Bonds deemed paid by Section 7.01.
d. Bonds in lieu of which others have been authenticated under
Section 2.05 (relating to registration and exchange of Bonds) or
Section 2.06 (relating to mutilated, lost, stolen, destroyed or
undelivered Bonds).
6
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Bonds purchased by the Trustee or the Company pursuant to tenders or in lieu
of redemption under Article III will continue to be outstanding until the
Company directs the Trustee to cancel them. Bonds purchased pursuant to
tenders or in lieu of redemption and not delivered to the Trustee for payment
are not outstanding, but there will be outstanding Bonds authenticated and
delivered in lieu of such undelivered Bonds as provided in the second
paragraph of Section 2.06.
"Participant" means one of the entities which deposit securities,
directly or indirectly, in the Book-Entry System.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, estate, unincorporated organization
or government or any agency or political subdivision thereof.
"Plant" means the Company's Farley Nuclear Plant located near the Town
of Columbia, Alabama.
The term "principal," when used with reference to any Bonds, includes
any premium payable on those Bonds.
The term "principal corporate trust office", when used with respect to
the Trustee, means the corporate trust office of the Trustee located at 100
Office Park Drive, Birmingham, Alabama 35223.
"Prior Indenture" means the Trust Indenture dated as of May 1, 1978, as
supplemented and amended, under which the Series E Bonds were issued.
"Project" means the air and water pollution control and sewage and solid
waste disposal facilities refinanced from the proceeds of the Series D Bonds,
all as described in Exhibit A to the Original Agreement.
"Purchase Price" means an amount equal to 100% of the principal amount
of any Bond tendered or deemed tendered pursuant to the provisions of
paragraph 6 in the form of the Bonds appearing as Exhibit A hereto, plus
accrued and unpaid interest thereon to the date of purchase.
"Record Date" is defined in the form of the Bonds appearing as Exhibit A
hereto.
"Remarketing Agent" means Merrill Lynch, Pierce, Fenner & Smith
Incorporated and its successors under this Indenture.
"Responsible Officer" means any officer or trust officer of the Trustee
assigned by the Trustee to administer its corporate trust matters.
"Securities Depository" means The Depository Trust Company, New York,
New York or its nominee, and its successors and assigns, or any successor
appointed under Section 5.01.
7
<PAGE>
"Series E Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series E (Alabama Power Company Farley Plant Project) issued and
outstanding in the aggregate principal amount of $81,500,000.
"Series E Trustee" means SouthTrust Bank of Alabama, National
Association, in its capacity as Trustee for the Series E Bonds.
"State" means the State of Alabama.
"Tax Agreement" means the Tax and Non-Arbitrage Certificate of the
Company dated the date of issuance of the Bonds.
"Trustee" means the entity identified as such in the heading of this
Indenture and its successors under this Indenture.
"Unassigned Rights" means the rights of the Issuer under the second and
third paragraphs of Section 3.1 (relating to fees and expenses and amounts
payable to redeem the Series E Bonds), Section 4.3 (relating to
indemnification) and Section 5.3 (relating to expenses of collection) of the
Agreement.
"Weekly Rate" means an interest rate on the Bonds set under
Section 2.02(a)(2).
Section 1.02. Rules of Construction. Unless the context otherwise
requires,
a. an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles,
b. references to Articles and Sections are to the Articles and
Sections of this Indenture, and
c. the singular form of any word, including the terms defined
in Section 1.01, includes the plural, and vice versa, and any reference
to the male gender includes the female gender.
ARTICLE II
THE BONDS
Section 2.01. Issuance of Bonds: Form; Dating. The Bonds shall be
designated "The Industrial Development Board of the Town of Columbia,
Pollution Control Revenue Refunding Bonds, 1995 Series C (Alabama Power
Company Project)." The total principal amount of Bonds that may be
outstanding shall not exceed $27,000,000. The Bonds shall be substantially in
the form of Exhibit A, which is part of this Indenture, in the denominations
provided for in the Bonds. The Bonds may have notations, legends or
endorsements required by law or usage.
All Bonds will be dated the date of original issuance and delivery and
shall mature, subject to prior redemption, on October 1, 2022.
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<PAGE>
Bonds issued in exchange for Bonds surrendered for transfer or exchange
or in place of mutilated, lost, stolen, destroyed or undelivered Bonds will
bear interest from the last date to which interest has been paid on the Bonds
being transferred, exchanged or replaced or, if no interest has been paid, as
of the date of their original issuance and delivery. Bonds will be numbered as
determined by the Trustee.
Upon the execution and delivery of this Indenture, the Issuer will
execute and deliver to the Trustee and the Trustee will authenticate the Bonds
and deliver them to the purchaser or purchasers as directed by the Issuer.
Section 2.02. Interest on the Bonds. Interest on the Bonds will be
payable as provided in the Bonds and in this Section. Interest on the Bonds
will initially be payable at the Daily Rate. The interest rate determination
method may be changed by the Company as described in paragraph (b) below. The
methods of determining the various interest rates are as provided in the
following paragraph (a).
(a) Interest Rate Determination Methods. While there exists an Event
of Default under the Indenture, the interest rate on the Bonds will be the
rate on the Bonds on the day before the Event of Default occurred, except that
if interest on any Bond was then payable at a Commercial Paper Rate, the
interest rate for all Bonds then bearing interest at a Commercial Paper Rate
will be the highest Commercial Paper Rate then in effect for any Bond.
(1) Daily Rate. When interest on the Bonds is payable at a
Daily Rate, the Remarketing Agent will set a Daily Rate on or before
11:00 a.m., New York City time, on each Business Day for that Business
Day. Each Daily Rate will be the minimum rate necessary (as determined
by the Remarketing Agent based on the examination of tax-exempt
obligations comparable to the Bonds known by the Remarketing Agent to
have been priced or traded under then-prevailing market conditions) for
the Remarketing Agent to sell the Bonds on the day the rate is set at
their principal amount (without regard to accrued interest). The Daily
Rate for any non-Business Day will be the rate for the last day for
which a rate was set.
(2) Weekly Rate. When interest on the Bonds is payable at a
Weekly Rate, the Remarketing Agent will set a Weekly Rate on or before
5:00 p.m., New York City time, on the last Business Day before the
commencement of a period during which the Bonds bear interest at a
Weekly Rate and on each Tuesday thereafter so long as interest on the
Bonds is to be payable at a Weekly Rate or, if any Tuesday is not a
Business Day, on the next preceding Business Day. Each Weekly Rate will
be the minimum rate necessary (as determined by the Remarketing Agent
based on the examination of tax-exempt obligations comparable to the
Bonds known by the Remarketing Agent to have been priced or traded under
then prevailing market conditions) for the Remarketing Agent to sell the
Bonds on the date the rate is set at their principal amount (without
regard to accrued interest). Thereafter, each Weekly Rate shall apply
to (i) the period beginning on the Wednesday after the Weekly Rate is
set and ending on the following Tuesday or, if earlier, ending on the
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<PAGE>
day before the effective date of a new method of determining the
interest rate on the Bonds or (ii) the period beginning on the effective
date of the change to a Weekly Rate and ending on the next Tuesday.
(3) Commercial Paper Rate. During a Commercial Paper Mode,
each Bond will bear interest during the Commercial Paper Period for such
Bond at the Commercial Paper Rate for such Bond. Different Commercial
Paper Periods may apply to different Bonds at any time and from time to
time. Except as otherwise described in this subparagraph (3), the
Commercial Paper Period and Commercial Paper Rate for each Bond will be
determined by the Remarketing Agent no later than 12:15 p.m., New York
City time, on the first day of each Commercial Paper Period.
(i) Determination of Commercial Paper Periods. Each Commercial
Paper Period will be a period of at least one day and not more
than 365 days, determined by the Remarketing Agent to be the
period which, together with all other Commercial Paper Periods for
all Bonds then outstanding, will, in the judgment of the
Remarketing Agent, result in the lowest overall interest expense
on the Bonds over the next 365 days; provided, however, that at
any time at which a Credit Agreement is in effect, the Remarketing
Agent shall not establish any Commercial Paper Period which would
end at a time when no Credit Agreement is in effect. Each
Commercial Paper Period will end on either the day before a
Business Day or on the day before the Maturity Date for such Bond.
However, any Bond purchased on behalf of the Company and remaining
unsold by the Remarketing Agent as of the close of business on the
first day of the Commercial Paper Period for that Bond will have a
Commercial Paper Period of one day or, if that Commercial Paper
Period would not end on a day before a Business Day, a Commercial
Paper Period of the shortest possible duration greater than one
day ending on a day before a Business Day.
In determining the number of days in each Commercial Paper
Period, the Remarketing Agent shall take into account the
following factors: (I) existing short-term tax-exempt market rates
and indices of such short-term rates, (II) the existing market
supply and demand for short-term tax-exempt securities,
(III) existing yield curves for short-term and long-term tax-
exempt securities for obligations of credit quality comparable to
the Bonds, (IV) general economic conditions, (V) industry economic
and financial conditions that may affect or be relevant to the
Bonds, (VI) the number of days in other Commercial Paper Periods
applicable to the Bonds and (VII) such other facts, circumstances
and conditions as the Remarketing Agent, in its sole discretion,
shall determine to be relevant.
(ii) Determination of Commercial Paper Rates. The
Commercial Paper Rate for each Commercial Paper Period for each
Bond shall be the minimum rate necessary (as determined by the
Remarketing Agent based on the examination of tax-exempt
obligations comparable to the Bonds known by the Remarketing Agent
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to have been priced or traded under the then-prevailing market
conditions) for the Remarketing Agent to sell such Bond on the
date and at the time of such determination at its principal amount
(without regard to accrued interest).
(4) Long-Term Interest Rate. The Remarketing Agent will set a
Long-Term Interest Rate on a date no more than 15 days before the
beginning of any period (a "Long-Term Interest Rate Period") in which
interest on any of the Bonds will be payable at a Long-Term Interest
Rate. Each Long-Term Interest Rate will be the minimum rate necessary
(as determined by the Remarketing Agent based on the examination of tax-
exempt obligations comparable to the Bonds known by the Remarketing
Agent to have been priced or traded under then-prevailing market
conditions) for the Remarketing Agent to sell the Bonds on the effective
date of the Long-Term Interest Rate at their principal amount (without
regard to accrued interest).
(5) Failure of Remarketing Agent to Announce Interest Rates on
the Bonds. If the appropriate interest rate or Commercial Paper Period
is not or cannot be determined for whatever reason, the method of
determining interest on the Bonds shall be automatically converted to
the Weekly Rate (without the necessity of complying with the
requirements of Section 2.02(b)) and the interest rate shall be equal to
the J.J. Kenny Index, or such other index (or percentage of an index)
deemed appropriate for tax-exempt securities of the nature of the Bonds
as the Remarketing Agent, with the consent of the Trustee, may have
previously selected, until such time as the method of determining
interest on the Bonds can be changed in accordance with Section 2.02(b);
provided, that if the Bonds are then in a Long-Term Interest Rate
Period, the Bonds shall bear interest at a Weekly Rate, but only if a
Favorable Opinion of Tax Counsel with respect to the change to a Weekly
Rate has been delivered to the Trustee. If such Favorable Opinion of
Tax Counsel has not been delivered, the Bonds shall remain in a Long-
Term Interest Rate Period with an interest rate equal to the interest
rate for the prior Long-Term Interest Rate Period and with a duration
equal to the prior Long-Term Interest Rate Period (or, if earlier, a
Long-Term Interest Rate Period ending on the day before the Maturity
Date for such Bond). The Trustee shall promptly notify the Bondholders
of any such automatic change as set forth in Section 2.02(c).
While Bonds are in a Commercial Paper Mode, during any transition
period caused by an automatic conversion of such Bonds to a Weekly Rate
in accordance with this Subsection (5), Bonds bearing interest at a
Weekly Rate and Bonds bearing interest at a Commercial Paper Rate, as
applicable, shall be governed by the provisions of this Indenture
applicable to such methods of determining interest on the Bonds.
(b) (1) Change in Interest Rate Determination Method. The Company
may change the method of determining the interest rate on the Bonds by
notifying the Issuer, the Trustee, the Remarketing Agent and, if a Book-Entry
System is then in effect for the Bonds, the Securities Depository. Such notice
shall contain (a) the effective date, (b) the proposed interest rate
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determination method, (c) if the change is to a Long-Term Interest Rate or
Rates, the last day of the first such Long-Term Interest Rate Period and, at
the option of the Company, the effective date and last day of any successive
Long-Term Interest Rate Periods (which last day for each Long-Term Interest
Rate Period must be either the day before the related Maturity Date for such
Bonds or a day which is before a Business Day and is at least 365 days after
the effective date), and (d) if the change is to a Commercial Paper Rate, the
termination date of any Credit Agreement which will be in effect during the
Commercial Paper Period. The Long-Term Interest Rate Period shall be the same
duration for all of the Bonds. The notice must be accompanied by a Favorable
Opinion of Tax Counsel, except as described below. Except in the case of the
rescission of the Favorable Opinion of Tax Counsel described in
Section 2.02(e), if the Company's notice complies with this paragraph, the
interest rate on the Bonds will be payable at the new rate on the effective
date specified in the notice until there is another change as provided in this
Section. Notwithstanding anything in this Indenture to the contrary, the
Company must deliver a Favorable Opinion of Tax Counsel whenever there is a
change from a period during which the interest rate on the Bonds is set at
intervals of 365 days or less to a period during which the interest rate on
the Bonds is set at intervals in excess of 365 days, or vice versa.
If the Company wishes to designate successive Long-Term Interest Rate
Periods without specifying the effective dates and last days as described in
the preceding paragraph for the second or any subsequent Long-Term Interest
Rate Periods, it may do so by following the same procedure as for a change in
the interest rate determination method as provided in the foregoing paragraph.
If, 30 days before the end of a Long-Term Interest Rate Period, the
Company has not provided for the next interest rate period, a new Long-Term
Interest Rate Period of the same duration will follow (or if shorter, a Long-
Term Interest Rate Period ending on the day before the Maturity Date for the
Bonds).
When one Long-Term Interest Rate Period follows another, all provisions
of this Indenture applying to a change in the interest rate determination
method will apply, except:
(A) the redemption described under "Mandatory Redemption Upon a
Change in the Method of Determining the Interest Rate on the Bonds" in
the Bonds;
(B) the Company will not be required to deliver a Favorable
Opinion of Tax Counsel if a new Long-Term Interest Rate Period begins as
a result of the Company failing to provide for the next interest rate
period; and
(C) the Company will not be required to deliver a Favorable
Opinion of Tax Counsel if the Company has previously designated a series
of successive Long-Term Interest Rate Periods which, together with the
current Long-Term Interest Rate Period, are substantially equal in
length, and if a Favorable Opinion of Tax Counsel was delivered before
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the first such Long-Term Interest Rate Period in that series which
applies to each successive Long-Term Interest Rate Period.
(2) Limitations. Any change in the method of determining interest on
the Bonds pursuant to paragraph (1) above must comply with the following:
(i) the effective date of a change (or each effective date in
the case of a change from a Commercial Paper Mode) shall be a Business
Day which is at least 15 days (30 days if a Long-Term Interest Rate is
then in effect and the effective date is before the day after the last
day of a Long-Term Interest Rate Period) after the twelfth Business Day
after receipt by the Trustee of the Company's notice of the change;
(ii) if a Long-Term Interest Rate is then in effect, the
effective date of any change must be either the day after the last day
of the Long-Term Interest Rate Period or, except as described in
clause (iii) below, a day on which the Bonds would otherwise be subject
to redemption under the paragraph "Optional Redemption at a Premium
During Long-Term Interest Rate Period" in Section 8 of the Bonds if the
change did not occur; provided that if the effective date of the change
is before the day after the last day of the Long-Term Interest Rate
Period, the Company must also deliver an Opinion of Tax Counsel stating
that, as of the first day on which the Bonds were subject to optional
redemption during such Long-Term Interest Rate Period, the Company's
ability to terminate such Long-Term Interest Rate Period prior to the
day after the last day of such Long-Term Interest Rate Period did not
and does not adversely affect the exclusion of interest on the Bonds
from federal gross income;
(iii) if the Company has previously designated successive Long-
Term Interest Rate Periods, the effective date of each Long-Term
Interest Rate Period must be the day after the last day of the previous
Long-Term Interest Rate Period;
(iv) if a Commercial Paper Mode is then in effect, the effective
date of any change must be either the day after the last day of the
Commercial Paper Mode or, as to any Bond, the day after the last day of
the Commercial Paper Period then in effect (or to be in effect) with
respect to that Bond;
(v) if any Bonds have been called for redemption and the
redemption has not yet occurred, the effective date of the change cannot
be before such redemption date;
(vi) if a Long-Term Interest Rate or a Daily Rate is then in
effect, the effective date of any change cannot occur during the period
after a Record Date and to, but not including, the related Interest
Payment Date; and
(vii) if a Commercial Paper Mode is then in effect, the
Remarketing Agent shall determine Commercial Paper Periods of such
duration that will, in the judgment of the Remarketing Agent, best
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promote an orderly transition on the effective date. After the receipt
by the Trustee of the Company's notice of such change, the day after the
last day of each Commercial Paper Period shall be, with respect to such
Bond, the effective date of the change. The Remarketing Agent shall
promptly give written notice of each such last date and each such
effective date with respect to each Bond to the Issuer, the Company, and
the Trustee.
During any such transition period, Bonds bearing interest at a
Commercial Paper Rate shall be governed by the provisions of this
Indenture applicable to a Commercial Paper Mode and Bonds bearing
interest at a Daily Rate, Weekly Rate or Long-Term Interest Rate, as
applicable, shall be governed by the provisions of this Indenture
applicable to such methods of determining interest on the Bonds.
(c) Notice to Bondholders of Change in Interest Rate Determination
Method. When a change in the interest rate determination method is to be
made, or upon commencement of a new Long-Term Interest Rate Period, the
Trustee will, upon notice from the Company pursuant to Section 2.02(b), notify
the Bondholders by first class mail at least 15 days before the effective date
(or each effective date in the case of an adjustment from a Commercial Paper
Mode) of the change, except that such notice shall be given at least 30 days
prior to the effective date if a Long-Term Interest Rate is in effect and the
effective date is on or before the end of the Long-Term Interest Rate Period.
The notice shall be effective when sent and shall state:
(1) that the interest rate determination method will be changed
and what the new method will be;
(2) the effective date of the new rate; and
(3) that a mandatory redemption or mandatory purchase in lieu
of redemption will result on the effective date of the change as
provided in the Bonds and all the information required by this Indenture
to be included in a notice of redemption set forth in Section 3.04.
The information required in any notice pursuant to this subsection (c)
and the information referred to in any redemption notice (including an
Additional Notice) pursuant to Section 3.04 may be combined in a single notice
if it is sent to Bondholders in the manner and at the time specified under
"Notice of Redemption" in Section 8 of the form of the Bonds.
(d) Calculation of Interest. The Remarketing Agent shall provide the
Trustee and the Company with notice in writing or by telephone (any such
notice by telephone to be delivered to a Responsible Officer of the Trustee)
promptly confirmed by facsimile transmission by 12:30 p.m., New York City
time,
(1) on the first Business Day after a month in which interest
on the Bonds was payable at a Daily Rate, of the Daily Rate for each day
in such month;
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(2) on each day on which a Weekly Rate becomes effective, of
the Weekly Rate;
(3) on the first day of each Commercial Paper Period, of the
length thereof and the Commercial Paper Rate, and, if there is more than
one Commercial Paper Rate then in effect, of the related applicable
principal amounts;
(4) on the first Business Day of a Long-Term Interest Rate
Period, of the Long-Term Interest Rate or Long-Term Interest Rates set
for that period and the related applicable principal amounts; and
(5) on any Business Day preceding any redemption or purchase
date, any interest rate requested by the Trustee in order to enable it
to calculate the accrued interest, if any, due on such redemption or
purchase date.
Using the rates supplied by the notice required by this subsection (d),
the Trustee will calculate the interest payable on the Bonds. The Remarketing
Agent will inform the Trustee and the Company orally at the oral request of
either of them of any interest rate set by the Remarketing Agent. The Trustee
will confirm the effective interest rate by telephone or in writing to any
Bondholder who requests it in any manner.
The setting of the rates and the calculation of interest payable on the
Bonds as provided in this Indenture will be conclusive and binding on all
parties.
(e) Change in Rate Determination Method-Opinions of Counsel.
Notwithstanding any provision of this Section 2.02, no change shall be made in
the interest rate determination method at the direction of the Company
pursuant to Section 2.02(b)(1) hereof if the Trustee shall receive written
notice prior to such change that the Favorable Opinion of Tax Counsel required
under Section 2.02(b)(1) or Section 2.02(a)(5) or, if applicable, the Opinion
of Tax Counsel required by Section 2.02(b)(2)(ii), has been rescinded. If the
Trustee shall have sent any notice to the Bondholders regarding a change in
rate under Section 2.02(c), then in the event of such rescission of, or
failure to deliver, such opinion, the Trustee shall promptly notify all
Bondholders of such rescission.
(f) Notice to Bondholders of Voluntary Termination of Credit
Agreement. If the Trustee receives notice from the Company as provided in
Section 3.5 of the Agreement to the effect that the Company intends to
terminate the Credit Agreement prior to its stated termination date, the
Trustee shall notify the Bondholders by first class mail at least 15 Business
Days prior to the effective date of such termination. The notice shall be
effective when sent and shall state:
(1) that the Company has notified the Trustee that it intends
to terminate the Credit Agreement;
(2) the effective date of such termination; and
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(3) if the interest is then payable at a Daily Rate or a Weekly
Rate, that the Bondholders have the right to tender Bonds to the Trustee
for purchase as provided in Section 6 of the form of the Bonds set out
in Exhibit A hereto.
Section 2.03. Execution and Authentication. The Bonds shall be
signed on behalf of the Issuer with the manual or facsimile signature of the
Chairman or Vice Chairman of its board of directors, and attested by the
manual or facsimile signature of its Secretary or Assistant Secretary, and the
seal of the Issuer shall be impressed or imprinted on the Bonds by facsimile
or otherwise. All authorized facsimile signatures shall have the same effect
as if manually signed. If an officer of the Issuer whose signature is on a
Bond no longer holds that office at the time the Trustee authenticates the
Bond, the Bond shall nevertheless be valid. Also, if a person signing a Bond
is the proper officer on the actual date of execution, the Bond shall be valid
even if that person is not the proper officer on the nominal date of action.
A Bond shall not be valid for any purpose under this Indenture until the
Trustee manually signs the certificate of authentication on the Bond. Such
signature shall be conclusive evidence that the Bond has been authenticated
under this Indenture.
As a precondition to the initial authentication and delivery of the
Bonds, the Trustee shall receive a request and authorization to the Trustee
from the Issuer, signed by the Chairman or Vice Chairman of the board of
directors of the Issuer, to authenticate and deliver the Bonds to the persons
and in the manner therein described.
Section 2.04. Bond Register. Bonds must be presented at the
principal corporate trust office of the Trustee for registration, transfer,
exchange and payment. Bonds tendered by their holders must be delivered as
specified in the Bonds. The Trustee shall keep a register of Bonds and of
their transfer and exchange, which register shall be open to inspection by the
Issuer and the Company during normal business hours.
Section 2.05. Registration and Exchange of Bonds; Persons Treated as
Owners. Bonds may be transferred only on the register maintained by the
Trustee. Upon surrender for transfer of any Bond to the Trustee, duly
endorsed for transfer or accompanied by an assignment duly executed by the
holder or the holder's attorney duly authorized in writing, the Trustee will
authenticate a new Bond or Bonds of the same maturity, in an equal total
principal amount and registered in the name of the transferee.
Bonds may be exchanged for an equal total principal amount of Bonds of
the same maturity but of different authorized denominations. The Trustee will
authenticate and deliver Bonds that the Bondholder making the exchange is
entitled to receive, bearing numbers not then outstanding.
Except in connection with the purchase of Bonds tendered for purchase or
purchased in lieu of redemption, the Trustee will not be required to transfer
or exchange any Bond called for redemption or during the period beginning 15
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days before the mailing of notice calling the Bonds or any portion of the
Bonds for redemption and ending on the redemption date.
The holder of a Bond shall be the absolute owner of the Bond for all
purposes, and payment of principal, interest or purchase price shall be made
only to or upon the written order of the holder or the holder's legal
representative.
The Trustee will require the payment by a Bondholder requesting exchange
or transfer of any tax or other governmental charge required to be paid in
respect of the exchange or transfer but will not impose any other charge.
Section 2.06. Mutilated, Lost, Stolen, Destroyed or Undelivered
Bonds. If any Bond is mutilated, lost, stolen or destroyed, the Trustee will
authenticate a new Bond of the same maturity and denomination if any mutilated
Bond shall first be surrendered to the Trustee, and if, in the case of any
lost, stolen or destroyed Bond, there shall first be furnished to the Issuer,
the Trustee and the Company evidence of such loss, theft or destruction,
together with an indemnity, satisfactory to them. If the Bond has matured,
instead of issuing a replacement Bond, the Trustee may with the consent of the
Company pay the Bond without requiring surrender of the Bond and make such
requirements as the Trustee deems fit for its protection, including a lost
instrument bond. The Issuer, the Company and the Trustee may charge their
reasonable fees and expenses in this connection.
If a Bond is called for redemption and the Company elects to purchase
the Bond in lieu of redemption as provided in Article III, or if the holder of
a Bond gives irrevocable instructions to the Remarketing Agent for purchase,
and in each case funds are deposited with the Trustee sufficient for the
purchase, the Trustee upon request of the Company or the Remarketing Agent
will authenticate a new Bond in the same maturity and in the same denomination
registered as the Company or the Remarketing Agent may direct and deliver it
to the Company or upon the Company's order, whether or not the Bond purchased
or called for redemption is ever delivered, and the Bond purchased or called
for redemption shall be cancelled on the books of the Trustee, whether or not
said Bond has been delivered to the Trustee. From and after the purchase
date, interest on such Bond shall cease to be payable to the prior holder
thereof, such holder shall cease to be entitled to the benefits or security of
this Indenture and shall have recourse solely to the funds held by the Trustee
for the purchase of such Bond and the Trustee shall not register any further
transfer of such Bond by such prior holder. All funds held by the Trustee for
the purchase of undelivered Bonds shall be held uninvested.
Section 2.07. Cancellation of Bonds. Whenever a Bond is delivered
to the Trustee for cancellation (upon payment, redemption or otherwise), or
for transfer, exchange or replacement pursuant to Section 2.05 or
Section 2.06, the Trustee will promptly cancel and dispose of the Bond in
accordance with the Trustee's policy of disposal; provided, however, that the
Trustee shall not be required to destroy cancelled Bonds.
Section 2.08. Temporary Bonds. Until definitive Bonds are ready for
delivery, the Issuer may execute and the Trustee will authenticate temporary
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Bonds substantially in the form of the definitive Bonds, with appropriate
variations. The Issuer will, without unreasonable delay, prepare and the
Trustee will authenticate definitive Bonds in exchange for the temporary
Bonds. Such exchange shall be made by the Trustee without charge.
ARTICLE III
REDEMPTION, PURCHASES IN LIEU OF REDEMPTION AND REMARKETING
Section 3.01. Notices to Trustee. If the Company wishes that any
Bonds be redeemed pursuant to any optional redemption provision in the Bonds,
the Company will notify the Trustee of the applicable provision, the
redemption date, the principal amount of the Bonds to be redeemed and other
necessary particulars. The Company will give the notice at least 45 days
before the redemption date, or such shorter period of time agreed to by the
Trustee.
Section 3.02. Redemption Dates. The redemption date of Bonds to be
redeemed pursuant to any optional redemption provision in the Bonds will be a
date permitted by the Bonds and specified by the Company in the notice
delivered pursuant to the preceding Section. The redemption date for mandatory
redemptions will be as specified in the Bonds to be redeemed or determined by
the Trustee consistently with the provisions of the Bonds.
Section 3.03. Selection of Bonds to Be Redeemed. Except as provided
in the Bonds, if fewer than all the Bonds are to be redeemed, the Trustee will
select the Bonds to be redeemed by lot or other method it deems fair and
appropriate, except that the Trustee will first select any Bonds owned by the
Company or any of its nominees or held by the Trustee for the account of the
Company or any of its nominees. The Trustee will make the selection from
Bonds not previously called for redemption. For this purpose, the Trustee
will consider each Bond in a denomination larger than the minimum denomination
permitted by the Bonds at the time to be separate Bonds each in the minimum
denomination. Provisions of this Indenture that apply to Bonds called for
redemption also apply to portions of Bonds called for redemption.
Section 3.04. Redemption Notices.
(a) Official Notice of Redemption. The Trustee will give notice of
each redemption as provided in the Bonds and will at the same time give a copy
of the notice to the Remarketing Agent, provided that no redemption notice
shall be given with respect to a redemption under "Mandatory Redemption on
Each Interest Payment Date During Commercial Paper Mode" in Section 8 of the
form of the Bonds. The notice shall identify the Bonds to be redeemed and
will state (1) the redemption date (and, if the Bonds provide that accrued
interest will not be paid on the redemption date, the date it will be paid),
(2) the redemption price, (3) that the Bonds called for redemption must be
surrendered to collect the redemption price, (4) the address at which the
Bonds must be surrendered and (5) that interest on the Bonds called for
redemption ceases to accrue on the redemption date.
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With respect to an optional redemption of any Bonds under "Optional
Redemption at a Premium During Long-Term Interest Rate Period," "Extraordinary
Optional Redemption" or "Optional Redemption During Daily or Weekly Rate
Period" in Section 8 of the form of the Bonds, unless moneys sufficient to pay
the principal of, redemption premium, if any, and interest on the Bonds to be
redeemed shall have been received by the Trustee prior to the giving of such
notice of redemption, such notice may state that said redemption shall be
conditional upon the receipt of such moneys by the Trustee on or prior to the
date fixed for redemption. If such moneys are not received, such notice shall
be of no force and effect, the Issuer shall not redeem such Bonds, the
redemption price shall not be due and payable, and the Trustee shall give
notice, in the same manner in which the notice of redemption was given, that
such moneys were not so received and that such Bonds will not be redeemed.
Failure to give any required notice of redemption as to any particular
Bonds will not affect the validity of the call for redemption of any Bonds in
respect of which no such failure has occurred. Any notice mailed as provided
in the Bonds shall be effective when sent and will be conclusively presumed to
have been given whether or not actually received by any holder.
(b) Additional Notice of Redemption. In addition to the redemption
notice required above, if there is not a Book-Entry System in effect for the
Bonds, further notice (the "Additional Notice") shall be given by the Trustee
as set out below. No defect in the Additional Notice nor any failure to give
all or any portion of the Additional Notice shall in any manner defeat the
effectiveness of a call for redemption if notice is given as prescribed in
paragraph (a) above.
(1) Each Additional Notice of redemption shall contain the
information required in paragraph (a) above for an official notice of
redemption plus (i) the CUSIP numbers of all Bonds being redeemed;
(ii) the date of the Bonds as originally issued; (iii) the interest rate
determination method for, or the rate of interest borne by each Bond
being redeemed; (iv) the maturity date of each Bond being redeemed: and
(v) any other descriptive information needed to identify accurately the
Bonds being redeemed.
(2) Upon the payment of the redemption price of the Bonds being
redeemed, each check or other transfer of funds issued for such purpose
shall bear the CUSIP number identifying, by issue and maturity, the
Bonds being redeemed with the proceeds of such check or other transfer.
(3) Each Additional Notice of redemption shall be sent at least
30 days before the redemption date by registered or certified mail or
overnight delivery service (or by such other means as the Trustee may
have established with the securities depository or information service)
to all registered securities depositories then in the business of
holding substantial amounts of obligations similar to the Bonds (such
depositories now being Depository Trust Company of New York, New York,
Midwest Securities Trust Company of Chicago, Illinois, and Philadelphia
Depository Trust Company of Philadelphia, Pennsylvania) and to one or
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more national information services that disseminate notices of
redemption of obligations such as the Bonds.
The information required in any redemption notice (including an
Additional Notice) pursuant to this Section and the information required in
any notice pursuant to Section 2.02(c) may be combined in a single notice if
it is sent to Bondholders in the manner and at the time specified under
"Notice of Redemption" in Section 8 of the form of the Bonds.
Section 3.05. Payment of Bonds Called for Redemption. Upon
surrender to the Trustee, Bonds called for redemption shall be paid or
purchased in lieu of redemption as provided in this Article at the redemption
price stated in the notice, plus interest accrued to the redemption date, or
at a purchase price equal to principal plus accrued interest to the purchase
date, except that interest payable on Bonds bearing interest at a Daily Rate
will be paid on the fifth Business Day following the redemption date. Bonds
called for redemption and purchased pursuant to a tender before the redemption
date will not be redeemed but will be dealt with as provided below in this
Article.
Section 3.06. Bonds Redeemed in Part. Upon surrender of a Bond
redeemed or purchased in lieu of redemption in part, the Trustee will
authenticate for the holder a new Bond or Bonds in authorized denominations
equal in principal amount to the unredeemed or unpurchased portion of the Bond
surrendered.
Section 3.07. Purchase of Bonds in Lieu of Redemption. When Bonds
are called for redemption pursuant to the paragraphs captioned, "Mandatory
Redemption at Beginning of a New Long-Term Interest Rate Period" or "Mandatory
Redemption Upon a Change in the Method of Determining the Interest Rate on the
Bonds" in Section 8 of the form of the Bonds, the Company may purchase some of
or all the Bonds called for redemption for a price equal to the otherwise
applicable redemption price, if it (or the Remarketing Agent) gives written
notice to the Trustee by 5:00 p.m. New York City Time on the day before the
redemption date that it wishes to purchase the Bonds the principal amount of
which is specified in the notice and furnishes the Trustee sufficient money in
sufficient time for the Trustee to make the purchase on the redemption date.
The Trustee will purchase Bonds called for redemption pursuant to the
paragraph captioned "Mandatory Redemption on Each Interest Payment Date During
Commercial Paper Mode" unless otherwise instructed in writing by the Company,
or unless the Indenture otherwise requires that they be redeemed and
cancelled, before the redemption date. The Trustee will purchase the Bonds
pursuant to this Section only as provided in Section 4.02.
Section 3.08. Disposition of Purchased Bonds. (a) Bonds to be
Remarketed. Bonds purchased pursuant to tenders as provided in the Bonds or
in lieu of redemption as provided in the foregoing Section will be offered for
sale by the Remarketing Agent as provided in this Section except as follows:
(1) Bonds purchased pursuant to a tender after having been
called for redemption under a provision in the Bonds that does not
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provide the Company an option to purchase in lieu of redemption will be
canceled.
(2) Bonds called for redemption under "Mandatory Redemption
Upon a Change in the Method of Determining the Interest Rate on the
Bonds" in Section 8 of the Bonds, which are tendered between the date
notice of redemption is given and the redemption date, may be remarketed
before the redemption date only if the buyer receives a copy of the
redemption notice from the Remarketing Agent.
(3) Bonds will not be offered for sale under this Section
during the continuance of an Event of Default.
(b) Remarketing Effort. Except to the extent the Company directs the
Remarketing Agent not to do so, the Remarketing Agent will offer for sale and
use reasonable efforts to sell all Bonds to be sold as provided in paragraph
(a) above and, when directed by the Company, any Bonds held by the Company.
The sale price of each Bond must be equal to the principal amount of each Bond
plus accrued interest to the purchase date. The Company may direct the
Remarketing Agent from time to time to cease and to resume sales efforts with
respect to some of or all the Bonds. The Remarketing Agent may buy as
principal any Bonds to be offered under this Section.
(c) Notices in Respect of Tenders. When the Trustee receives a notice
from a Bondholder (or a Beneficial Owner through its direct Participant) as
specified in Section 6 of the Bonds for the bondholder (or a Beneficial Owner
through its direct Participant) to tender Bonds, the Trustee will promptly
notify the Remarketing Agent and the Company by facsimile transmission or
telephone, promptly confirmed in writing, of the receipt of such notice, but
in no event later than the following times:
(i) When the Bonds bear interest at a Daily Rate, no later
than 11:15 a.m. (New York City time) on the same Business Day; and
(ii) When the Bonds bear interest at a Weekly Rate, no later
than 11:15 a.m. (New York City time) on the Business Day next succeeding
receipt of such notice.
(d) Delivery of Remarketed Bonds.
(i) The Trustee shall hold all Bonds delivered pursuant to this
Section in trust for the benefit of the owners thereof until moneys
representing the Purchase Price of such Bonds shall have been delivered
to or for the account of or to the order of such Bondholders, and
thereafter, if such Bonds are remarketed, shall deliver replacement
Bonds, prepared by the Trustee in accordance with the directions of the
Remarketing Agent and authenticated by the Trustee, for any Bonds
purchased in accordance with the written directions of the Remarketing
Agent to the Remarketing Agent for delivery to the purchasers thereof.
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(ii) The Remarketing Agent shall advise the Trustee and the
Company in writing or by facsimile transmission, promptly confirmed in
writing, of the principal amount of Bonds which have been remarketed,
together with the denominations and registration instructions (including
taxpayer identification numbers) in accordance with the following
schedule (all times of which are New York City time):
CURRENT METHOD OF INTEREST
RATE DETERMINATION OR, IN
CONNECTION WITH A CHANGE IN
SUCH METHOD, THE NEW METHOD TIME BY WHICH INFORMATION TO BE
OF INTEREST RATE DETERMINATION FURNISHED TO TRUSTEE
Commercial Paper Period 12:15 p.m. on the purchase date
Daily Rate Period 12:15 p.m. on the purchase date
Weekly Rate Period 12:15 p.m. on the purchase date
Long-Term Interest Rate Period 12:15 p.m. on the purchase date
(iii) The terms of any sale by the Remarketing Agent shall
provide for the authorization of the payment of the Purchase Price by
the Remarketing Agent to the Trustee in exchange for Bonds registered in
the name of the new Bondholder which shall be delivered by the Trustee
to the Remarketing Agent at or before 2:00 p.m. (New York City time) on
the purchase date if the Purchase Price has been received from the
Remarketing Agent by the time set forth in Section 3.08(e) on the
purchase date. Such payment by the Remarketing Agent pursuant to such
authorization shall be made on such date.
(e) Delivery of Proceeds of Sale. The Remarketing Agent shall deliver
directly to the Trustee an amount equal to the principal amount thereof plus
accrued interest, if any, of the Bonds which the Remarketing Agent has advised
the Trustee have been remarketed pursuant to Section 3.08(d)(ii) no later than
12:30 p.m. (New York City time) on the purchase date.
ARTICLE IV
APPLICATION OF PROCEEDS AND PAYMENT OF BONDS
Section 4.01. Application of Proceeds. The Issuer will cause the
proceeds of the initial sale of the Bonds to be deposited with the Trustee.
On a date to be designated by the Company (but in no event later than December
31, 1995) the Trustee will disburse the proceeds of the initial sale of the
Bonds to the Series E Trustee for deposit in the bond fund under the Prior
Indenture, to be applied to pay a portion of the outstanding principal amount
of the Series E Bonds upon call for redemption.
Pursuant to Section 3.1 of the Agreement, the Company has agreed to pay
to the Series E Trustee the amount in excess of the proceeds of the Bonds
needed to accomplish the refunding described in this Section. Any investment
earnings remaining after the transfer of moneys to the Series E Trustee, will
be applied to the payment of interest on the Bonds on the next Interest
Payment Date.
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Section 4.02. Payments of Bonds. The Trustee will make payments of
principal of, premium, if any, and interest on the Bonds from moneys available
to the Trustee under this Indenture for that purpose. The Trustee will pay
the Purchase Price of tendered Bonds first from the proceeds of the sale of
Bonds under Section 3.08 and second from other moneys available to the Trustee
for that purpose. All moneys received as proceeds of remarketing the Bonds
under Section 3.08 shall be held segregated by the Trustee in a separate and
segregated account.
Section 4.03. Investments of Moneys. The Trustee will invest and
reinvest moneys held by the Trustee as directed by a Company Representative in
writing, to the extent permitted by law, in:
(a) Government Obligations;
(b) Bonds and notes of the Federal Land Bank;
(c) Obligations of the Federal Intermediate Credit Bank;
(d) Obligations of the Federal Bank for Cooperatives;
(e) Bonds and notes of Federal Home Loan Banks;
(f) Negotiable or non-negotiable certificates of deposit, time
deposits or similar banking arrangements, issued by a bank or trust company
(which may be the commercial banking department of the Trustee or any bank or
trust company under common control with the Trustee) or savings and loan
association which are insured by the Federal Deposit Insurance Corporation or
secured as to principal by Government Obligations;
(g) Investments made in or through the Trustee's cash sweep accounts
or other short term investment funds, the assets of which consist of
investments described in clause (a) above; or
(h) Other investments then permitted by law.
The Trustee may make investments permitted by this Article through its
own bond department or the bond department of any bank or trust company under
common control with the Trustee. Investments will be made so as to mature or
be subject to redemption at the option of the holder on or before the date or
dates that the Trustee anticipates that moneys from the investments will be
required. The Trustee, when authorized by the Company, may trade with itself
in the purchase and sale of securities for such investment. Investments will
be registered in the name of the Trustee and held by or under the control of
the Trustee. The Trustee will sell and reduce to cash a sufficient amount of
investments whenever the cash held by the Trustee is insufficient. The Trustee
shall not be liable for any loss from such investments to the extent directed
by the Company Representative and to the extent such directions have been
complied with by the Trustee.
Section 4.04. Moneys Held in Trust. The Trustee will hold in trust
for the benefit of the Bondholders all moneys held by it for any payment on
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the Bonds. The proceeds of the initial sale of the Bonds shall be held in a
separate and segregated account by the Trustee until disbursed as described in
Section 4.01. Money received by the Remarketing Agent or the Trustee from the
sale of a Bond under Section 3.08 or for the purchase of a Bond will be held
segregated from other funds of the Remarketing Agent or the Trustee in trust
for the benefit of the person from whom such Bond was purchased or the person
delivering such purchase money, as the case may be, and will not be invested.
The Trustee shall promptly, but in no event later than 30 days of their
original deposit, apply moneys received from the Company in accordance with
this Indenture and the Tax Agreement and as directed by the Company
Representative.
ARTICLE V
BOOK-ENTRY SYSTEM
Section 5.01. Book-Entry System. The Bonds shall be initially
issued in the name of Cede & Co., as nominee for The Depository Trust Company
as the initial Securities Depository and registered owner of such Bonds, and
held in the custody of the Securities Depository. A single certificate will
be issued and delivered to the Securities Depository for the Bonds. The
Beneficial Owners will not receive physical delivery of Bond certificates
except as provided herein. For so long as the Securities Depository shall
continue to serve as securities depository for such Bonds as provided herein,
all transfers of beneficial ownership interests will be made by book-entry
only, and no investor or other party purchasing, selling or otherwise
transferring beneficial ownership of such Bonds is to receive, hold or deliver
any Bond certificate. The Issuer, the Company and the Trustee will recognize
the Securities Depository or its nominee as the Bondowner of such Bonds for
all purposes, including notices and voting.
The Issuer and the Trustee covenant and agree, so long as The Depository
Trust Company shall continue to serve as Securities Depository for the Bonds,
to meet the requirements of The Depository Trust Company with respect to
required notices and other provisions of the Letter of Representations
executed with respect to the Bonds.
The Issuer, the Trustee and the Remarketing Agent may conclusively rely
upon (i) a certificate of the Securities Depository as to the identity of the
Participants in the Book-Entry-System and (ii) a certificate of any such
Participant as to the identity of, and the respective principal amount of
Bonds beneficially owned by, the Beneficial Owners.
Whenever, during the term of the Bonds, the beneficial ownership thereof
is determined by a book-entry at the Securities Depository, the requirements
in this Indenture of holding, delivering or transferring Bonds shall be deemed
modified to require the appropriate person to meet the requirements of the
Securities Depository as to registering or transferring the book-entry to
produce the same effect. Any provision hereof permitting or requiring
delivery of Bonds shall, while the Bonds are in a Book-Entry System, be
satisfied by the notation on the books of the Securities Depository in
accordance with applicable law.
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The Trustee and the Issuer, at the direction and expense of the Company
and with the consent of the Remarketing Agent, may from time to time appoint a
successor Securities Depository and enter into an agreement with such
successor Securities Depository to establish procedures with respect to the
Bonds not inconsistent with the provisions of this Indenture. Any successor
Securities Depository shall be a "clearing agency" registered under
Section 17A of the Securities Exchange Act of 1934, as amended.
None of the Issuer, the Company, the Trustee nor the Remarketing Agent
will have any responsibility or obligation to any Securities Depository, any
Participants in the Book-Entry System or the Beneficial Owners with respect to
(i) the accuracy of any records maintained by the Securities Depository or any
Participant; (ii) the payment by the Securities Depository or by any
Participant of any amount due to any Beneficial Owner in respect of the
principal amount or redemption or purchase price of, or interest on, any
Bonds; (iii) the delivery of any notice by the Securities Depository or any
Participant; (iv) the selection of the Beneficial Owners to receive payment in
the event of any partial redemption of the Bonds; or (v) any other action
taken by the Securities Depository or any Participant.
Bond certificates are required to be delivered to and registered in the
name of the Beneficial Owner, under the following circumstances:
(a) The Securities Depository determines to discontinue
providing its service with respect to the Bonds and no successor
Securities Depository is appointed as described above. Such a
determination may be made at any time by giving 30 days' notice to the
Issuer, the Company and the Trustee and discharging its responsibilities
with respect thereto under applicable law; or
(b) The Company determines not to continue the Book-Entry
System through a Securities Depository.
The Trustee is hereby authorized to make such changes to the form of
bond attached hereto as Exhibit A which are not inconsistent with this
Indenture and which are necessary or appropriate to reflect that the Book-
Entry System is not in effect, that a successor Securities Depository has been
appointed or that an additional or co-paying agent or tender agent has been
designated pursuant to Section 13.03 hereof.
If at any time, the Securities Depository ceases to hold the Bonds all
references herein to the Securities Depository shall be of no further force or
effect.
ARTICLE VI
COVENANTS
Section 6.01. Payment of Bonds. The Issuer will promptly pay the
principal or purchase price of, premium, if any, and interest on the Bonds on
the dates and in the manner provided in the Bonds, but only from the amounts
assigned to and held by the Trustee under this Indenture.
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Section 6.02. Recording and Filing; Further Assurances. (a) The
Trustee shall cooperate with the Company in causing to be filed all necessary
financing statements and continuation statements related to this Indenture and
all supplements hereto, and such other documents as may be, in the Opinion of
Counsel, necessary to be kept and filed in such manner and in such places as
may be required by law in order to preserve and protect fully the security of
the Bondholders and the rights of the Trustee hereunder.
(b) The Issuer will execute and deliver such supplemental indentures
and such further instruments, and do such further acts, as the Trustee may
reasonably require for the better assuring, assigning and confirming to the
Trustee the amounts assigned under this Indenture for the payment of the
Bonds.
Section 6.03. 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 that end, the Issuer and the Company will comply with all
requirements of the Code and the 1954 Code to the extent applicable to the
Bonds. If at any time the Issuer or the Company is of the opinion that for
purposes of this Section 6.03 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 including, if necessary, the investment of such moneys in
obligations of any state, any political subdivision thereof, or any public
corporation or instrumentality of either thereof, the interest on which is
excludable from gross income under the Code.
Without limiting the generality of the foregoing, the Issuer and the
Company agree that there shall be paid from time to time all amounts required
to be rebated to the United States pursuant to Section 148(f) of the Code and
any temporary, proposed or final Treasury Regulations as may be applicable to
the Bonds from time to time. 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 4.6 of
the Agreement and in the Tax Agreement. The Issuer and the Trustee hereby
covenant and agree to cooperate fully with the Company regarding compliance
with the provisions of this Article VI and Section 4.6 of the Agreement.
Notwithstanding any provision of this Section, if the Company provides
to the Trustee and the Issuer an Opinion of Tax Counsel to the effect that any
action required under this Section is no longer required, or to the effect
that some further action is required, to maintain the exclusion of interest on
the Bonds from federal gross income, the Trustee and the Issuer may
conclusively rely on such opinion in complying with the provisions of this
Indenture, and the covenants under this Indenture shall be deemed to be
modified to that extent.
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Section 6.04. Termination of Subordinated Security Interest. Upon
Satisfaction by the Company of its obligations under Section 3.1 of the
Agreement, the Trustee shall execute and deliver to the Company such documents
as shall be necessary to effect or evidence the termination and release of the
Subordinated Security Interest (as defined in the Agreement).
ARTICLE VII
DISCHARGE OF INDENTURE
Section 7.01. Bonds Deemed Paid; Discharge of Indenture. Any Bond
will be deemed paid for all purposes of this Indenture when (a) payment of the
principal of and interest on the Bond to the due date of such principal and
interest (whether at maturity, upon redemption or otherwise) or the payment of
the Purchase Price either (1) has been made in accordance with the terms of
the Bonds or (2) has been provided for by depositing with the Trustee
(A) moneys sufficient to make such payment and/or (B) Government Obligations
maturing as to principal and interest in such amounts and at such times as
will insure the availability of sufficient moneys to make such payment, and
(b) all compensation and reasonable expenses of the Trustee pertaining to each
Bond in respect of which such deposit is made have been paid or provided for
to the Trustee's satisfaction. When a Bond is deemed paid, it will no longer
be secured by or entitled to the benefits of this Indenture or be an
obligation of the Issuer, except for payment from moneys or Government
Obligations under (a)(2) above and except that it may be tendered if and as
provided in the Bonds and it may be transferred, exchanged, registered,
discharged from registration or replaced as provided in Article II.
Notwithstanding the foregoing, upon the deposit of funds under
clause (a)(2) of the first paragraph of this Section, the purchase price of
tendered Bonds shall be paid from the sale of Bonds under Section 3.08. If
payment of such purchase price is not made from the above sources, payment
shall be made from funds on deposit pursuant to this Section, in which case
such Bonds shall be surrendered to the Trustee and cancelled.
Notwithstanding the foregoing, no deposit under clause (a)(2) of the
first paragraph of this Section shall be deemed a payment of a Bond until the
Company has furnished the Trustee an Opinion of Tax Counsel stating that the
deposit of such cash or Government Obligations will not cause the Bonds to
become "arbitrage bonds" under Section 148 of the Code and until (a) notice of
redemption of the Bond is given in accordance with Article III or, if the Bond
is not to be redeemed or paid within the next 60 days, until the Company has
given the Trustee, in form satisfactory to the Trustee, irrevocable
instructions (i) to notify, as soon as practicable, the owner of the Bond, in
accordance with Article III, that the deposit required by (a)(2) above has
been made with the Trustee and that the Bond is deemed to be paid under this
Article and stating the maturity or redemption date upon which moneys are to
be available for the payment of the principal of the Bond, and premium, if
any, and interest on such Bond, if the Bond is to be redeemed rather than paid
and (ii) to give notice of redemption not less than 30 nor more than 60 days
prior to the redemption date for such Bond or (b) the maturity of the Bond.
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When all outstanding Bonds are deemed paid under the foregoing
provisions of this Section, the Trustee will upon request acknowledge the
discharge of the lien of this Indenture, provided, however that the
obligations relating to the tender for purchase as provided in the Bonds and
obligations under Article II in respect of the transfer, exchange,
registration, discharge from registration and replacement of Bonds shall
survive the discharge of the lien of the Indenture.
No deposit will be made or accepted and no use made of any such deposit
which would cause any Bonds to be treated as "arbitrage bonds" within the
meaning of Section 148 of the Code.
Section 7.02. Application of Trust Money. The Trustee shall hold in
trust money or Government Obligations deposited with it pursuant to the
preceding Section and shall apply the deposited money and the money from the
Government Obligations in accordance with this Indenture only to the payment
of principal of, premium, if any, and interest on the Bonds and to the payment
of the purchase price of tendered Bonds.
Section 7.03. Repayment to Company. The Trustee shall promptly pay
to the Company upon request any excess money or securities held by the Trustee
at any time under this Article and any money held by the Trustee under any
provision of this Indenture for the payment of principal or interest or for
the purchase of Bonds that remains unclaimed for five years.
ARTICLE VIII
DEFAULTS AND REMEDIES
Section 8.01. Events of Default. An "Event of Default" is any of
the following:
(a) Default in the payment of any interest on any Bond when due
and as the same shall become due and payable, which default continues
for five days.
(b) Default in the due and punctual payment of principal on any
Bond when due and payable, whether at maturity, upon redemption, or by
declaration or otherwise.
(c) Default in the payment of the purchase price of any Bond
tendered by its Beneficial Owner pursuant to the Bonds.
(d) An event of default has occurred and is continuing under
the Agreement.
Section 8.02. Acceleration. Whenever an Event of Default has
occurred and is continuing, the Bonds shall without further action become
immediately due and payable.
Section 8.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may, and upon request of the holders of at least 25%
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in principal amount of the Bonds then outstanding shall, pursue any available
remedy by proceeding at law or in equity to collect the principal of or
interest on the Bonds or to enforce the performance of any provision of the
Bonds, this Indenture or the Agreement.
The Trustee, as the assignee of all the right, title and interest of the
Issuer in and to the Agreement, shall enforce each and every right granted to
the Issuer under the Agreement.
The Trustee may maintain a proceeding even if it does not possess any of
the Bonds or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Bondholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
In the event of a bankruptcy or reorganization of the Company, the
Trustee may file a proof of claim on behalf of all Bondholders with respect to
the obligations of the Company pursuant to the Agreement.
Section 8.04. Waiver of Past Defaults. The holders of a majority in
principal amount of the Bonds then outstanding by notice to the Trustee may
waive an existing Event of Default and its consequences. When an Event of
Default is waived, it is cured and stops continuing, but no such waiver shall
extend to any subsequent or other Event of Default or impair any right
consequent to it.
Section 8.05. Control by Majority. The holders of a majority in
principal amount of the Bonds then outstanding may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
of exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 9.01, that the Trustee determines is unduly prejudicial to
the rights of other Bondholders, or would involve the Trustee in personal
liability.
Section 8.06. Limitation on Suits. A Bondholder may not pursue any
remedy with respect to this Indenture or the Bonds unless (a) the holder gives
the Trustee notice stating that an Event of Default is continuing, (b) the
holders of at least 25% in principal amount of the Bonds then outstanding make
a written request to the Trustee to pursue the remedy, (c) such holder or
holders offer to the Trustee indemnity satisfactory to the Trustee against any
loss, liability or expense and (d) the Trustee does not comply with the
request within 60 days after receipt of the request and the offer of
indemnity.
A Bondholder may not use this Indenture to prejudice the rights of
another Bondholder or to obtain a preference or priority over the other
Bondholders.
Section 8.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any holder
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to receive payment of principal of and interest on a Bond, on or after the due
dates expressed in the Bond, or the purchase price of a Bond on or after the
date for its purchase as provided in the Bond, or to bring suit for the
enforcement of any such payment on or after such dates, shall not be impaired
or affected without the consent of the holder.
Section 8.08. Collection Suit by Trustee. If an Event of Default
under Section 8.01(a), (b) or (c) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against
the Company for the whole amount remaining unpaid.
Section 8.09. Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Bondholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the holders in any election of a trustee in bankruptcy or other
person performing similar functions. In the event of a bankruptcy or
reorganization of the Company, the Trustee may file a proof of claim on behalf
of all Bondholders with respect to the obligations of the Company pursuant to
the Agreement.
Section 8.10. Priorities. If the Trustee collects any money
pursuant to this Article, it shall pay out the money in the following order:
FIRST: To the Trustee for amounts to which it is entitled
under Section 9.06.
SECOND: To Bondholders for amounts due and unpaid on the Bonds
for principal and interest, ratably, without
preference or priority of any kind, according to the
amounts due and payable on the Bonds for principal and
interest, respectively.
THIRD: To the Company.
The Trustee may fix a payment date for any payment to the Bondholders.
Section 8.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any
party litigant in the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This Section does not
apply to a suit by the Trustee, a suit by a holder pursuant to Section 8.07 or
a suit by holders of more than 10% in principal amount of the Bonds then
outstanding.
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ARTICLE IX
TRUSTEE AND REMARKETING AGENT
Section 9.01. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise its rights and powers
and use the same degree of care and skill in their exercise as a prudent
person would exercise or use under the circumstances in the conduct of such
person's own affairs.
(b) Except during the continuance of an Event of Default,
(1) the Trustee need perform only those duties that are
specifically set forth in this Indenture and applicable laws and
regulations, and no others and no implied duties or covenants shall be
read into this Indenture against the Trustee, and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed, upon certificates, opinions, requisitions or
any other writing furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own grossly
negligent action, its own grossly negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b)
of this Section,
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts,
(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 8.05, and
(4) 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, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to all the paragraphs of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
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liability or expense, but the Trustee may not require indemnity as a condition
to declaring the principal of and interest on the Bonds to be due immediately
under Section 8.02 or to making any payment of principal or interest on the
Bonds.
(f) The Trustee shall not be liable for interest on any cash held by
it except as the Trustee may agree with the Company or the Issuer with the
consent of the Company.
(g) In addition to the funds and accounts established by this
Indenture, the Trustee may establish such funds and accounts as it deems
necessary and appropriate in order to discharge its duties under this
Indenture.
Section 9.02. Rights of Trustee. Subject to the foregoing Section:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on any certificate of an
appropriate officer or officers of the Issuer or the Company or Opinion
of Counsel.
(c) The Trustee may act through agents or co-trustees but shall
be answerable for the conduct of the same in accordance with the
standards specified in this Indenture.
Section 9.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Bonds and
may otherwise deal with the Issuer or with the Company or its affiliates with
the same rights it would have if it were not Trustee.
Section 9.04. Trustee's Disclaimer. The Trustee makes no
representation as to the validity or adequacy of this Indenture, the Agreement
or the Bonds, and it shall not be responsible for any statement in the Bonds
other than its certificate of authentication.
Section 9.05. Notice of Defaults. If an event occurs which with the
giving of notice or lapse of time or both would be an Event of Default, and if
the event is continuing and if it is known to the Trustee, the Trustee shall
promptly mail to each Bondholder notice of the event. Except in the case of a
default in payment or purchase on any Bonds, the Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Bondholders.
Section 9.06. Compensation and Indemnity of Trustee. For acting
under this Indenture, the Trustee shall be entitled to payment of reasonable
fees for its services and reimbursement of advances, reasonable counsel fees
and other expenses reasonably and necessarily made or incurred by the Trustee
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as shall be agreed upon in writing by the Trustee and the Company from time to
time in connection with its services under this Indenture.
To secure the payment or reimbursement to the Trustee provided for in
this Section, the Trustee shall have a senior claim, to which the Bonds are
made subordinate, on all money or property held or collected by the Trustee,
except that held under Article VII or otherwise held in trust to pay principal
of and interest on particular Bonds.
The Company has agreed in the Agreement to indemnify the Trustee for,
and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of this trust, including the reasonable
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
Section 9.07. Eligibility of Trustee. This Indenture shall always
have a Trustee that is a corporation or association organized and doing
business under the laws of the United States or any state or the District of
Columbia, is authorized under such laws to exercise corporate trust powers, is
subject to supervision or examination by United States, state or District of
Columbia authority and has a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition. If at any time the Trustee ceases to be eligible in accordance
with this Section, the Trustee will resign immediately as set forth in Section
9.08.
Section 9.08. Replacement of Trustee. (a) The Trustee may resign by
notifying the Issuer and the Company and by mailing notice by first class mail
to the Bondholders.
Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee by an instrument in writing; provided that the
Company may not make such appointment if an Event of Default has occurred and
is continuing, or if an event has occurred and is continuing which, with the
passage of time or the giving of notice or both will become an Event of
Default. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee or any Bondholder who
has been a bona fide holder of a Bond for at least six months may, on behalf
of himself and others similarly situated, petition any such court for the
appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and may prescribe, appoint a successor
trustee.
(b) In case at any time either of the following shall occur:
(1) the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.07 and shall fail to resign after written
request therefor by the Company or the Issuer, or
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(2) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, the Company shall remove the Trustee and appoint a
successor trustee by an instrument in writing; provided that the Company may
not make such appointment if an Event of Default has occurred and is
continuing, or if an event has occurred and is continuing which, with the
passage of time or the giving of notice or both will become an Event of
Default, or any Bondholder may, on behalf of itself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and may prescribe, remove the
Trustee and appoint a successor trustee.
(c) Except as otherwise provided in this subsection (c), the Company
or holders of a majority in aggregate principal amount of the Bonds at the
time outstanding may at any time remove the Trustee and appoint a successor
trustee by an instrument or concurrent instruments in writing signed by the
Company or such Bondholders, as the case may be. The Company may not remove
the Trustee if an Event of Default has occurred and is continuing or if an
event has occurred and is continuing which, with the passage of time or the
giving of notice will become an Event of Default.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 9.09. The Company shall give written notification to any
rating agency then rating the Bonds of such successor trustee appointed
pursuant to this Section.
Section 9.09. Acceptance of Trust by Successor Trustee. Any
successor trustee appointed as provided in Section 9.08 shall execute,
acknowledge and deliver to the Issuer and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts, duties, and obligations of its
predecessor in the trusts hereunder, with like effect as if originally named
as Trustee herein; but, nevertheless, on the written request of the Issuer or
the request of the successor trustee, the Trustee ceasing to act shall execute
and deliver an instrument transferring to such successor trustee, upon the
trusts herein expressed, all the rights, power and trusts of the Trustee so
ceasing to act. Upon request of any such successor trustee, the Issuer shall
execute any and all instruments in writing necessary or desirable for more
fully and certainly vesting in and confirming to such successor trustee all
such rights, powers, and duties. Any Trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by
such Trustee to secure the amounts due it as compensation, reimbursement,
expenses, and indemnity afforded to it by Section 9.06.
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No successor trustee shall accept appointment as provided in this
Section 9.09 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 9.07.
At the time of appointment, the Company and the successor trustee shall
execute an agreement with respect to the compensation of the successor
trustee.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Issuer or such successor trustee shall give Bondholders
notice of the succession of such trustee to the trusts hereunder in the manner
prescribed in Section 9.08 for the giving of notice of resignation of the
Trustee.
Section 9.10. [reserved].
Section 9.11. Duties of Remarketing Agent. The Remarketing Agent
will set the interest rates on the Bonds and perform the other duties provided
for in Section 2.02 and will remarket Bonds as provided in Section 3.08,
subject to any provisions of a remarketing agreement between the Company and
the Remarketing Agent, which shall control in the case of any conflict with
this Indenture. The Remarketing Agent may for its own account or as broker or
agent for others deal in Bonds and may do anything any other Bondholder may do
to the same extent as if the Remarketing Agent were not serving as such.
Section 9.12. Eligibility of Remarketing Agent. The initial
Remarketing Agent appointed under this Indenture is Merrill Lynch, Pierce,
Fenner & Smith Incorporated, New York, New York. The Remarketing Agent will
be a bank, trust company or member of the National Association of Securities
Dealers, Inc. organized and doing business under the laws of the United States
or any state or the District of Columbia, will have a combined capital stock,
surplus and undivided profits of at least $15,000,000 as shown in its most
recent published annual report, will be a Participant in the Securities
Depository and will be authorized by law to perform all the duties imposed
upon it by this Indenture. Any successor Remarketing Agent shall be rated at
least Baa3/P-3 or otherwise qualified by Moody's Investors Service, Inc. or
have an equivalent rating of another rating agency.
Section 9.13. Replacement of Remarketing Agent. The Remarketing
Agent may resign by notifying the Issuer, Trustee, and Company. Such
resignation will take effect on the day a successor Remarketing Agent
appointed in accordance with this Section has accepted the appointment or, if
no successor has so accepted, 30 days after notice of resignation has been
sent. The Company may remove the Remarketing Agent at any time by an
instrument signed by the Company and filed with the Remarketing Agent, the
Issuer, and the Trustee at least 30 days prior to the effective date of such
removal (which will not in any event occur prior to the appointment of a
successor Remarketing Agent). A new Remarketing Agent may be appointed by the
Company upon the resignation or removal of the Remarketing Agent. The Trustee
shall promptly notify the Bondholders of any change in the Remarketing Agent.
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Section 9.14. Compensation of Remarketing Agent. The Remarketing
Agent will not be entitled to any compensation from the Issuer, the Trustee or
any property held under this Indenture but must make separate arrangements
with the Company for compensation.
Section 9.15. Successor Trustee or Remarketing Agent by Merger. If
the Trustee or Remarketing Agent consolidates with, merges or converts into,
or transfers all or substantially all its assets (or, in the case of a bank or
trust company, its corporate trust assets) to another corporation, the
resulting, surviving or transferee corporation without any further act shall
be the successor Trustee or Remarketing Agent, provided that such successor
shall be eligible under the applicable provisions in this Article.
ARTICLE X
AMENDMENTS OF AND SUPPLEMENTS TO INDENTURE
Section 10.01. Without Consent of Bondholders. The Issuer and the
Trustee may amend or supplement this Indenture or the Bonds without notice to
or consent of any Bondholder:
(a) to cure any ambiguity, inconsistency, or formal defect or
omission;
(b) to grant to the Trustee for the benefit of the Bondholders
additional rights, remedies, powers, or authority;
(c) to subject to this Indenture additional collateral or to add
other agreements of the Issuer;
(d) to modify this Indenture or the Bonds to permit
qualification under the Trust Indenture Act of 1939 or any similar
federal statute at the time in effect, or to permit the qualification of
the Bonds for sale under the securities laws of any state of the United
States;
(e) to authorize different authorized denominations of the Bonds
and to make correlative amendments and modifications to this Indenture
regarding exchangeability of Bonds of different authorized
denominations, redemptions of portions of Bonds of particular authorized
denominations and similar amendments and modifications of a technical
nature;
(f) to increase or decrease the number of days specified
for the giving of notices in Section 2.02 and to make corresponding
changes to the period for notice of redemption of the Bonds; provided
that no decreases in any such number of days shall become effective
except while the Bonds bear interest at a Daily Rate or a Weekly Rate
and until 30 days after the Trustee has given notice to the owners of
the Bonds;
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(g) to provide for an uncertificated system of registering the
Bonds or to provide for the change to or from a Book-Entry System for
the Bonds;
(h) to evidence the succession of a new Trustee or the
appointment by the Trustee or the Issuer of a co-trustee; or
(i) to make any change (including a change in Section 4.01
to reflect any amendment to the Code or interpretations thereof by the
Internal Revenue Service) that does not materially adversely affect the
rights of any Bondholder.
Section 10.02. With Consent of Bondholders. If an amendment of or
supplement to this Indenture or the Bonds without any consent of Bondholders
is not permitted by the preceding Section, the Issuer and the Trustee may
enter into such amendment or supplement without prior notice to any
Bondholders but with the consent of the holders of at least a majority in
principal amount of the Bonds then outstanding. However, without the consent
of each Bondholder affected, no amendment or supplement may (a) extend the
maturity of the principal of, or interest on, any Bond, (b) reduce the
principal amount of, or rate of interest on, any Bond, (c) effect a privilege
or priority of any Bond or Bonds over any other Bond or Bonds, (d) reduce the
percentage of the principal amount of the Bonds required for consent to such
amendment or supplement, (e) impair the exclusion from federal gross income of
interest on any Bond, (f) eliminate the holders' rights to tender the Bonds,
or any mandatory redemption of the Bonds, extend the due date for the purchase
of Bonds tendered by the holders thereof or call for mandatory redemption or
reduce the purchase or redemption price of such Bonds, (g) create a lien
ranking prior to or on a parity with the lien of this Indenture on the
property described in the Granting Clause of this Indenture, or (h) deprive
any Bondholder of the lien created by this Indenture on such property. In
addition, if moneys or Government Obligations have been deposited or set aside
with the Trustee pursuant to Article VII for the payment of Bonds and those
Bonds shall not have in fact been actually paid in full, no amendment to the
provisions of that Article shall be made without the consent of the holder of
each of those Bonds affected.
Section 10.03. Effect of Consents. Any consent received pursuant to
Section 10.02 will bind each Bondholder delivering such consent and each
subsequent holder of a Bond or portion of a Bond evidencing the same debt as
the consenting holder's Bond.
Section 10.04. Notation on or Exchange of Bonds. If an amendment or
supplement changes the terms of a Bond, the Trustee may require the holder to
deliver it to the Trustee. The Trustee may place an appropriate notation on
the Bond about the changed terms and return it to the holder. Alternatively,
if the Trustee, the Issuer and the Company determine, the Issuer in exchange
for the Bond will issue and the Trustee will authenticate a new Bond that
reflects the changed terms.
Section 10.05. Signing by Trustee of Amendments and Supplements. The
Trustee will sign any amendment or supplement to the Indenture or the Bonds
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authorized by this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities, or immunities of the Trustee. If it
does, the Trustee may, but need not, sign it. In signing an amendment or
supplement, the Trustee will be entitled to receive and (subject to Section
9.01) will be fully protected in relying on an Opinion of Counsel stating that
such amendment or supplement is authorized by this Indenture.
Section 10.06. Company Consent Required. An amendment or supplement
to this Indenture or the Bonds shall not become effective unless the Company
delivers to the Trustee its written consent to the amendment or supplement.
Section 10.07. Notice to Bondholders. The Trustee shall cause notice
of the execution of each supplement or amendment to this Indenture or the
Agreement to be mailed to the Bondholders. The notice will at the option of
the Trustee, either (i) briefly state the nature of the amendment or
supplement and that copies of it are on file with the Trustee for inspection
by Bondholders or (ii) enclose a copy of such amendment or supplement.
ARTICLE XI
AMENDMENTS OF AND SUPPLEMENTS TO THE AGREEMENT
Section 11.01. Without Consent of Bondholders. The Issuer may enter
into, and the Trustee may consent to, any amendment of or supplement to the
Agreement, or may waive compliance by the Company of any provision of the
Agreement, without notice to or consent of any Bondholder, if the amendment,
supplement, or waiver is required or permitted (a) by the provisions of the
Agreement or this Indenture (including in connection with transactions
permitted by Section 6.3 of the Original Agreement, relating to maintenance of
the Company's existence), (b) to cure any ambiguity, inconsistency or formal
defect or omission, (c) to identify more precisely the Project, (d) in
connection with any authorized amendment of or supplement to this Indenture or
(e) to make any change that does not materially adversely affect the rights of
any Bondholder.
Section 11.02. With Consent of Bondholders. If an amendment of or
supplement to the Agreement without any consent of Bondholders is not
permitted by the foregoing Section, the Issuer may enter into, and/or the
Trustee may consent to (as the case may be), such amendment or supplement, or
may waive compliance by the Company of any provision of the Agreement, without
notice to any Bondholder but with the consent of the holders of at least a
majority in principal amount of the Bonds then outstanding. However, without
the consent of each Bondholder affected, no amendment, supplement or waiver
may result in anything described in the lettered clauses of Section 10.02.
Section 11.03. Consents by Trustee to Amendments or Supplements. The
Trustee will consent to any amendment or supplement to the Agreement
authorized by this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities, or immunities of the Trustee. If it
does, the Trustee may, but need not, sign it. In signing a consent to an
amendment or supplement, the Trustee shall be entitled to receive and (subject
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to Section 9.01) shall be fully protected in relying on an Opinion of Counsel
stating that such amendment or supplement is authorized by this Indenture.
ARTICLE XII
[reserved]
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Notices. (a) Any notice, request, direction,
designation, consent, acknowledgment, certification, appointment, waiver, or
other communication required or permitted by this Indenture or the Bonds must
be in writing except as expressly provided otherwise in this Indenture or the
Bonds.
(b) Any notice or other communication shall be sufficiently given and
deemed given when delivered by hand or mailed by first-class mail, postage
prepaid, addressed as follows: if to the Issuer, if by mail to the Chairman
of the Board of Directors, at Town Hall, Columbia, Alabama 36319; if to the
Trustee, to P. O. Box 2554, Birmingham, Alabama 35290, Attention: Corporate
Trust Department; if to the Company, to 600 North 18th Street, Birmingham,
Alabama 35203, Attention: Treasurer; and if to the Remarketing Agent, to
Merrill Lynch, Pierce, Fenner & Smith Incorporated, World Financial Center -
North Tower, New York, New York 10281, Attention: Tax Exempt Money Markets
Department. Any addressee may designate additional or different addresses for
purposes of this Section.
Section 13.02. Bondholders' Consents. Any consent or other
instrument required by this Indenture to be signed by Bondholders may be in
any number of concurrent documents and may be signed by a Bondholder or by the
holder's agent appointed in writing. Proof of the execution of such
instrument or of the instrument appointing an agent and of the ownership of
Bonds, if made in the following manner, shall be conclusive for any purposes
of this Indenture with regard to any action taken by the Trustee under the
instrument:
(a) The fact and date of a person's signing an instrument may be
proved by the certificate of any officer in any jurisdiction who by law
has power to take acknowledgments within that jurisdiction that the
person signing the writing acknowledged before the officer the execution
of the writing, or by an affidavit of any witness to the signing.
(b) The fact of ownership of Bonds, the amount or amounts,
numbers and other identification of such Bonds and the date of holding
shall be proved by the registration books kept pursuant to this
Indenture.
In determining whether the holders of the required principal amount of
Bonds outstanding have taken any action under this Indenture, Bonds owned by
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the Company or any person controlling, controlled by or under common control
with the Company shall be disregarded and deemed not to be outstanding. In
determining whether the Trustee shall be protected in relying on any such
action, only Bonds which the Trustee knows to be so owned shall be
disregarded.
Any consent or other instrument shall be irrevocable and shall bind any
subsequent owner of such Bond or any Bond delivered in substitution therefor.
Section 13.03. Appointment of Separate Paying Agent and/or Tender
Agent. If, at any time, the Securities Depository ceases to hold the Bonds,
with the effect that the Bonds are no longer subject to the Book-Entry System,
then the Issuer and the Trustee, acting at the request of the Company, may
appoint one or more banks or trust companies to act as paying agent and/or
tender agent for the Bonds hereunder. Any such paying agent or tender agent
shall be a bank or trust company organized under the laws of the United States
of America or any state thereof, shall have a reported capital and surplus of
at least $100,000,000 and a corporate trust office located in New York, New
York at which Bonds may be presented for payment or purchase and shall perform
such duties and responsibilities as may be delegated to it hereunder. If such
a paying agent or tender agent is appointed, then all references herein to the
"Trustee" shall include such paying agent or tender agent to the extent of the
duties performed by such entity.
Section 13.04. Limitation of Rights. Nothing expressed or implied in
this Indenture or the Bonds shall give any person other than the Trustee,
Issuer, Company, Remarketing Agent, and the Bondholders any right, remedy or
claim under or with respect to this Indenture.
Section 13.05. Severability. If any provision of this Indenture
shall be determined to be unenforceable, that shall not affect any other
provision of this Indenture.
Section 13.06. Payments Due on Non-Business Days. If a payment date
is not a Business Day at the place of payment, then payment may be made at
that place on the next Business Day, and no interest shall accrue for the
intervening period.
Section 13.07. Governing Law. This Indenture shall be governed
exclusively by and construed in accordance with the applicable laws of the
State.
Section 13.08. Captions. The captions in this Indenture are for
convenience only and do not define or limit the scope or intent of any
provisions or Sections of this Indenture.
Section 13.09. No Recourse Against Issuer's Officers. No member,
director, officer, agent, or employee of the Issuer shall be individually or
personally liable for any payment on the Bonds or be subject to any personal
liability or accountability by reason of the issuance of the Bonds, but this
Section shall not relieve any such officer, director, member, agent, or
employee from the performance of any official duty provided by law or this
Indenture.
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Section 13.10. Limitation of Liability. Notwithstanding anything
contained in this Indenture to the contrary, the Bonds shall be limited
obligations of the Issuer and shall be payable solely from the revenues and
receipts and other amounts received by or on behalf of the Issuer pursuant to
the Agreement or the First Mortgage Bonds.
Section 13.11. Counterparts. This Indenture may be signed in several
counterparts. Each will be an original, but all of them together constitute
the same instrument.
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IN WITNESS WHEREOF, The Industrial Development Board of the Town of
Columbia has caused this Indenture to be signed in its name and its seal to be
hereunto affixed and attested by its duly authorized officers, respectively,
and SouthTrust Bank of Alabama, National Association, to evidence its
acceptance of the trust created hereunder, has caused this Indenture to be
signed in its name and its seal to be hereunto affixed and attested by its
duly authorized officers, respectively, all as of the day and year first above
written.
THE INDUSTRIAL DEVELOPMENT BOARD OF THE
TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
ATTEST:
Secretary
SOUTHTRUST BANK OF ALABAMA, NATIONAL
ASSOCIATION, as Trustee
[SEAL]
By:
Title:
ATTEST:
By:
Title:
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EXHIBIT A
[FORM OF BOND]
UNITED STATES OF AMERICA
STATE OF ALABAMA
No. __________ $
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
POLLUTION CONTROL REVENUE REFUNDING BOND, 1995 SERIES D
(ALABAMA POWER COMPANY PROJECT)
TYPE OF INTEREST
MATURITY DATE DATED DATE CUSIP RATE PERIOD
October 1, 2022 October 3, 1995 197210 AN7 Daily
REGISTERED OWNER:
PRINCIPAL AMOUNT:
The Industrial Development Board of the Town of Columbia (the "Issuer"),
a public corporation organized and existing under the laws of the State of
Alabama, hereby promises to pay, solely from the sources described in this
Bond, to the Registered Owner identified above, or registered assigns, on the
Maturity Date stated above (or if this Bond is called for earlier redemption
as described herein, on the redemption date) the principal amount identified
above and to pay interest as provided in this Bond.
1. Indenture; Agreement. This Bond is one of the bonds (the
"Bonds"), limited to $27,000,000 in principal amount, issued under the
Indenture of Trust dated as of October 1, 1995 (the "Indenture"), between the
Issuer and SouthTrust Bank of Alabama, National Association, as trustee (the
"Trustee"). The terms of the Bonds include those in the Indenture.
Bondholders are referred to the Indenture for a statement of those terms.
When used with reference to the Bonds, the term "principal" includes any
premium payable on those Bonds. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to them in the Indenture.
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The Issuer has sold certain air and water pollution control and sewage
treatment and disposal facilities (the "Project") located at the Farley Plant
(the "Plant") of Alabama Power Company (the "Company") to the Company pursuant
to an Installment Sale Agreement dated as of May 1, 1978, between the Issuer
and the Company, as heretofore supplemented and amended, including a Fifth
Supplementary Installment Sale Agreement dated as of October 1, 1995 (the
"Agreement"). Under the Agreement, Company is obligated to pay to the Issuer
amounts sufficient to pay all amounts coming due on the Bonds and other
expenses incurred in connection therewith, and the Issuer has assigned its
rights to such payments under the Agreement to the Trustee as security for the
Bonds. The proceeds of the Bonds will be used to refund certain outstanding
revenue bonds issued to finance and refinance the Project.
The Indenture and the Agreement may be amended, and references to them
include any amendments.
The Issuer has established a book-entry only system of registration for
the Bonds (the "Book-Entry System"). Except as specifically provided
otherwise in the Indenture, a Securities Depository (or its nominee) will be
the registered owner of this Bond. By acceptance of a confirmation of
purchase, delivery or transfer, the Beneficial Owner (if any) of this Bond
shall be deemed to have agreed to this arrangement. If the Securities
Depository (or its nominee) is the registered owner of this Bond, it shall be
treated as the owner of it for all purposes.
2. Source of Payments. The principal or purchase price of, premium,
if any, and interest on the Bonds are limited obligations of the Issuer and,
as provided in the Indenture, are payable solely and only from payments
derived from the sale of the Project to the Company under the Agreement and
from any other moneys held by the Trustee under the Indenture for such
purpose. The Bonds shall not in any respect be a general obligation of the
Issuer, nor shall they be an obligation of the Town of Columbia, Alabama or
the State of Alabama. Neither the faith and credit nor the taxing power of
the Town of Columbia, Alabama, the State of Alabama or any political
subdivision thereof, is pledged to the payment of the principal of the Bonds
or the interest thereon or other costs incident thereto.
3. Interest Rate. Interest on this Bond will be paid at the lesser
of (a) a Daily Rate, a Weekly Rate, a Commercial Paper Rate, or a Long-Term
Interest Rate as selected by the Company and as determined in accordance with
the Indenture and (b) 10%. Interest will initially be payable at a Daily Rate
as set forth in the Indenture. The Company may change the interest rate
determination method from time to time. A change in the method will result in
mandatory redemption of the Bonds (see "Redemption" below). While there
exists an Event of Default under the Indenture, the interest rate on the Bonds
will be the rate on the Bonds on the day before the Event of Default occurred,
except that if interest on any Bond was then payable at a Commercial Paper
Rate, the default rate for all Bonds then bearing interest at a Commercial
Paper Rate will be the highest Commercial Paper Rate then in effect for any
Bond.
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When interest is payable at a Daily, Weekly or Commercial Paper Rate, it
will be computed on the basis of the actual number of days elapsed over a year
of 365 days (366 in leap years), and when payable at a Long-Term Interest Rate
on the basis of a 360-day year of twelve 30-day months. Interest on overdue
principal and, to the extent lawful, on overdue premium and interest will be
payable at the rate on the Bonds on the day before the default occurred.
4. Interest Payment and Record Dates. Interest will accrue on the
unpaid portion of the principal of this Bond from the last date to which
interest was paid, or if no interest has been paid, from the date of the
original issuance of the Bonds until the entire principal amount of this Bond
is paid. When interest is payable at the rate in the first column below,
interest accrued during the period (an "Interest Period") shown in the second
column will be paid on the date (an "Interest Payment Date") in the third
column to holders of record on the date (a "Record Date") in the fourth
column:
INTEREST ACCRUAL INTEREST
RATE PERIOD PAYMENT DATE RECORD DATE
Daily* Calendar month Fifth Business Last Business
Day Day
of the next of the month
month
Weekly* Calendar month First Business Last Business
Day Day
of the next before Interest
month Payment Date
*If there shall be a change from a Daily Rate or a Weekly Rate on a day
other than the first day of a calendar month, the then current Interest Period
relating to such Daily Rate or Weekly Rate shall end on the day immediately
preceding the date on which the new interest rate on the Bonds shall become
effective, which date in the case of a change from a Weekly Rate, shall be the
Interest Payment Date for such Interest Period, for which the Record Date
shall be the immediately preceding Business Day; but in the case of a change
from a Daily Rate, the Interest Payment Date for such Interest Period shall be
the fifth Business Day after the last day of such Interest Period, for which
the Record Date shall be the last Business Day of such Interest Period. If
such new interest rate shall be a Daily Rate or a Weekly Rate, the first
Interest Period relatIng thereto shall begin on the effective date of such new
interest rate and end on the last day of the then current calendar month, for
which the Interest Payment Date and the Record Date shall be as prescribed in
this Table.
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Commercial Paper From 1 to 365 days Day after the Last Business
as determined for last Day
each Bond pursuant to day of before Interest
Section 2.02(a)(3) of Commercial Payment Date
the Indenture Paper Period
("Commercial Paper
Period")
Long-Term** Six-month period or Next day (April Fifteenth of the
portion thereof 1 month before the
ending on the last or October 1) Interest Payment
day Date (March 15
of March or September or
September
15)***
"Business Day" is defined in the Indenture. Payment of defaulted interest
will be made to holders of record as of the fifth-to-last Business Day before
payment.
5. Method of Payment. Holders must surrender Bonds to the Trustee to
collect principal at maturity or upon redemption. (See "Tenders" below for
the payment of purchase price of tendered Bonds.) Interest on Bonds bearing
interest at a Commercial Paper Rate is payable only upon presentation of such
Bonds to the Trustee. Interest on Bonds bearing interest at a Daily, Weekly,
or Long-Term Interest Rate will be paid to the registered holder hereof as of
the Record Date by check mailed by first-class mail on the Interest Payment
Date to such holder's registered address. A holder of $1,000,000 or more in
principal amount of Bonds may be paid interest at a Daily, Weekly or
Commercial Paper Rate by wire transfer in immediately available funds to an
**If there shall be a change from a Long-Term Interest Rate on a day
other than the day after the last day of the then current Long-Term Interest
Rate Period, or if there shall be an early termination of such Long-Term
Interest Rate Period and a new Long-Term Interest Rate shall be set, such
Long-Term Interest Rate Period shall end on the day immediately preceding the
date on which the new interest rate shall become effective, which date shall
be the Interest Payment Date for such Long-Term Interest Rate Period, for
which the Record Date shall be 15 days prior to such Interest Payment Date or,
if sooner, the first day of such Long-Term Interest Rate Period. If such new
interest rate shall be a Daily Rate or a Weekly Rate, the first Interest
Period relating thereto shall begin on the effective date of such new interest
rate and end on the last day of the then current calendar month, for which the
Interest Payment Date and the Record Date shall be prescribed in this Table.
***If an Interest Payment Date occurs less than 15 days after the first
day of a Long-Term Interest Rate Period, the first day of such Long-Term
Interest Rate Period is the Record Date for such interest Payment Date.
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account in the continental United States if the holder makes a written request
of the Trustee (in form satisfactory to the Trustee) at least two Business
Days before the Record Date specifying the account address. The notice may
provide that it will remain in effect for later interest payments until
changed or revoked by another written notice. Principal and interest will be
paid in money of the United States that at the time of payment is legal tender
for payment of public and private debts or by checks or wire transfers payable
in such money. If any payment on the Bonds is due on a non-Business Day, it
will be made on the next Business Day, and no interest will accrue as a
result.
6. Tenders. "Tender" means to require, or the act of requiring, the
Trustee to purchase a Bond at the holder's option under the provisions of this
Section 6 at 100% of the principal amount plus interest accrued to the date of
purchase. During a Daily Rate Period, if a Bond is tendered after the Record
Date and before the Interest Payment Date for that Interest Period, the
Trustee will pay a purchase price of principal plus interest accruing after
the last day of that Interest Period. The holder will receive interest for
that Interest Period by check or wire transfer as described in Section 5
above.
Daily Rate Tender. When interest on the Bonds is payable at a
Daily Rate and a Book-Entry System is in effect, a Beneficial Owner
(through its direct Participant in the Securities Depository) may tender
his interest in a Bond (or portion of Bond) by delivering an irrevocable
written notice or an irrevocable telephone notice, promptly confirmed in
writing, to the Trustee (any such telephone notice to be delivered to a
trust officer of the Trustee) and an irrevocable notice by telephone,
telegraph, or facsimile transmission to the Remarketing Agent, in each
case by 11:00 a.m., New York City time, on a Business Day, stating the
principal amount of the Bond (or portion of Bond being tendered),
payment instructions for the purchase price and the Business Day (which
may be the date the notice is delivered) the Bond (or portion of Bond)
is to be purchased. The Beneficial Owner shall effect delivery of such
Bonds by causing such direct Participant to transfer its interest in the
Bonds equal to such Beneficial Owner's interest on the records of the
Securities Depository to the participant account of the Trustee with the
Securities Depository. Any notice received by the Trustee after 11:00
a.m., New York City time, shall be deemed to have been given on the next
Business Day.
When interest on the Bonds is payable at a Daily Rate and a Book-
Entry System is not in effect, a holder of a Bond may tender the Bond
(or portion of Bond) by delivering the notices as described above (which
shall include the certificate number of the Bond), and shall also
deliver the Bond to the Trustee by 1:00 p.m., New York City time, on the
date of purchase (see additional requirements below).
Weekly Rate Tender. When interest on the Bonds is payable at a
Weekly Rate and a Book-Entry System is in effect, a Beneficial Owner
(through its direct Participant in the Securities Depository) may tender
his interest in a Bond (or portion of Bond) by delivering an irrevocable
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written notice or an irrevocable telephone notice, promptly confirmed in
writing, to the Trustee (any such telephone notice to be delivered to a
trust officer of the Trustee) and an irrevocable notice by telephone,
telegraph, or facsimile transmission to the Remarketing Agent, in each
case prior to 5:00 p.m., New York City time on a Business Day stating
the principal amount of the Bond (or portion of Bond) being tendered,
payment instructions for the purchase price, and the date, which must be
a Business Day at least seven days after the notice is delivered, on
which the Bond (or portion of Bond) is to be purchased. The Beneficial
Owner shall effect delivery of such Bonds by causing such direct
Participant to transfer its interest in the Bonds equal to such
Beneficial Owner's interest on the records of the Securities Depository
to the participant account of the Trustee with the Securities
Depository.
When interest on the Bonds is payable at a Weekly Rate and a Book-
Entry System is not in effect, a holder of a Bond may tender the Bond
(or portion of Bond) by delivering the notices as described above (which
shall include the certificate number of the Bond), and shall also
deliver the Bond to the Trustee by 1:00 p.m., New York City time, on the
date of purchase (see additional requirements below).
Payment of Purchase Price. The purchase price for a tendered Bond will
be paid in immediately available funds to the registered owner of the Bond by
the close of business on the date of purchase.
7. Delivery Address; Additional Delivery Requirements. Notices in
respect of tenders and Bonds tendered must be delivered to the Trustee as
follows:
SouthTrust Bank of Alabama, National Association
P. O. Box 2554
Birmingham, Alabama 35290
Attention: Corporate Trust Department
Telephone: (205) 254-5017
Fax: (205) 254-4180
Notices in respect of tenders shall be delivered to the Remarketing
Agent as follows:
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center - North Tower, 9th Floor
New York, New York 10281
Attention: Tax Exempt Money Markets Department
Telephone: (212) 449-4997
Fax: (212) 449-6440
The delivery addresses or telephone numbers of the Trustee or the Remarketing
Agent may be changed by notice mailed by first class mail to the Bondholders
at their registered addresses.
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<PAGE>
All tendered Bonds must be accompanied by an instrument of transfer
satisfactory to the Trustee, executed in blank by the registered owner or his
duly authorized attorney, with the signature guaranteed by an eligible
guarantor institution.
Limitation on Tenders. No Bonds may be tendered while they bear
interest at a Commercial Paper Rate or a Long-Term Interest Rate.
Irrevocable Notice Deemed to be Tender of Bond; Undelivered Bonds. The
giving of notice by an owner of a Bond as provided in Section 6 constitutes
the irrevocable tender for purchase of each Bond (or portion thereof) with
respect to which such notice was given, irrespective of whether such Bond was
delivered as provided in Section 6. The determination of the Trustee as to
whether a notice of tender has been properly delivered shall be conclusive and
binding upon the Bondholders.
The Trustee may refuse to accept delivery of any Bond for which a proper
instrument of transfer has not been provided. If any owner of a Bond who gave
notice fails to deliver his Bond to the Trustee at the place and on the
applicable date and time specified, or fails to deliver his Bond properly
endorsed, his Bond shall constitute an undelivered Bond as described in
Section 2.06 of the Indenture. BY ACCEPTANCE OF THIS BOND, THE OWNER AGREES
TO SELL AND SURRENDER THIS BOND, PROPERLY ENDORSED, TO THE TRUSTEE AFTER THE
GIVING OF IRREVOCABLE NOTICE OF TENDER FOR PURCHASE AS DESCRIBED ABOVE.
8. Redemptions. As provided below, the Company has the right to
purchase Bonds in lieu of certain redemptions. BY ACCEPTANCE OF THIS BOND,
THE OWNER AGREES TO SELL AND SURRENDER THIS BOND, PROPERLY ENDORSED, TO THE
COMPANY IN LIEU OF REDEMPTION UNDER THE CONDITIONS DESCRIBED BELOW. All
redemptions and purchases in lieu of redemption will be made in funds
immediately available on the redemption or purchase date and will be at a
redemption or purchase price of 100% of the principal amount of the Bonds
being redeemed or purchased (unless a premium is required as provided below)
plus interest accrued to the redemption or purchase date, except that interest
accruing at a Daily Rate will be paid on the fifth Business Day following the
redemption or purchase date. Bonds tendered for purchase on a date after a
call for redemption but before the redemption date will be purchased pursuant
to the tender. No purchase of Bonds by the Company or advance use of any
funds to effectuate any such purchase shall be deemed to be a payment or
redemption of the Bonds or of any portion thereof and such purchase will not
operate to extinguish or discharge the indebtedness evidenced by such Bonds.
Optional Redemption at a Premium During Long-Term Interest Rate Period.
During any Long-Term Interest Rate Period of less than or equal to five years,
the Bonds will not be redeemable pursuant to this provision during the Long-
Term Interest Rate Period.
If the Long-Term Interest Rate Period is greater than five years, the
Bonds will not be redeemable for five years after the date on which the Bonds
begin to bear interest at the Long-Term Interest Rate. After the five year
no-call period, the Bonds may be redeemed at any time in whole or in part at
102% of their principal amount. The premium will decline every year on the
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<PAGE>
anniversary of the date on which the Bonds begin to bear interest at the Long-
Term Interest Rate, by one percentage point until the Bonds are redeemable
without premium.
As an alternative to and in lieu of the foregoing redemption provisions
if, with respect to any Long-Term Interest Rate Period, a Favorable Opinion of
Tax Counsel is delivered to the Trustee not later than the date of the
establishment of such Long-Term Interest Rate Period, the Bonds may be
redeemed during such Long-Term Interest Rate Period at the option of the
Company in whole or in part at any time after a no-call period, if any,
established by the Remarketing Agent, at the percentages of their principal
amount, plus accrued interest, as follows: The Remarketing Agent shall, given
the duration of the Long-Term Interest Rate Period, determine and inform the
Trustee, on a date which is no later than the establishment of the Long-Term
Interest Rate, the periods during which the Bonds shall not be subject to
redemption (the "Call Protection Period"), the redemption premium or premiums
(the "Call Premiums"), if any, applicable to the redemption of Bonds after the
Call Protection Period, and the period or periods during which the Call
Premiums shall be effective (the "Call Premium Periods") necessary to
establish the Long-Term Interest Rate. Such Call Protection Period, Call
Premiums and Call Premium Periods shall be established in accordance with
optional call redemption provisions which in the judgment of the Remarketing
Agent, are generally accepted as the standard features for obligations such as
the Bonds, given the length of the Long-Term Interest Rate Period.
Extraordinary Optional Redemption. The Bonds may be redeemed in whole
at the option of the Company at any time after the occurrence of any of the
following:
(a) Damage or destruction to the Plant or the Project to such
extent that in the opinion of the Company's board of directors
(expressed in a resolution) filed with the Issuer and the Trustee: (1)
the Plant or the Project, as the case may be, cannot be reasonably
repaired, rebuilt or restored within a period of six months to their
condition immediately preceding such damage or destruction, or (2) the
Company is thereby prevented from carrying on its normal operations at
the Plant for a period of six months.
(b) Loss of title to or use of a substantial part of the Plant
or the Project as a result of the exercise of the power of eminent
domain which, in the opinion of the Company's board of directors
(expressed in a resolution) filed with the Issuer and the Trustee,
results or is likely to result in the Company being thereby prevented
from carrying on its normal operations therein for a period of six
months.
(c) Any event occurs which, in the opinion of the Company's
board of directors (expressed in a resolution), renders the Project or
the Plant so uneconomical that it is abandoned.
A-50
<PAGE>
Any such redemption shall be on any date within 90 days from the time
the Company files the required resolution and directs that the Bonds are to be
redeemed, which direction must be given, if at all, within 180 days following
the occurrence of one of the events listed above.
Optional Redemption During Daily or Weekly Rate Period. When interest
on the Bonds is payable at a Daily or Weekly Rate, the Bonds may be redeemed
in whole or in part at the option of the Company, on any Business Day.
Mandatory Redemption at Beginning of a New Long-Term Interest Rate
Period. When the Bonds bear interest at a Long-Term Interest Rate and a new
Long-Term Interest Rate is to be determined, the Bonds will be redeemed or
purchased by the Company in lieu of redemption on the effective date of the
new Long-Term Interest Rate. In the case of a change prior to the day
originally established as the day after the last day of a Long-Term Interest
Rate Period, the Bonds will be redeemed or purchased at the percentage of
their principal amount which would be payable upon the applicable redemption
described under "Optional Redemption at a Premium During Long-Term Interest
Rate Period" above.
Mandatory Redemption on Each Interest Payment Date During Commercial
Paper Mode. When Bonds bear interest at a Commercial Paper Rate, each Bond
will be redeemed or purchased by the Company in lieu of redemption on the
Interest Payment Date for such Bond. If Bonds are scheduled to be redeemed
under the following paragraph, the Bonds will be called under, and redemption
will be governed by, that paragraph and not this paragraph.
Mandatory Redemption Upon a Change in the Method of Determining the
Interest Rate on the Bonds. On the effective date of the change in the method
of determining the interest rate on the Bonds (the four methods being Daily,
Weekly, Commercial Paper, or Long-Term Interest Rates) the Bonds will be
redeemed or purchased by the Company in lieu of redemption on the effective
date of such change. Any such redemption or purchase shall be at a price
equal to 100% of the principal amount of the Bonds, except that in the case of
a change prior to the day originally established as the day after the last day
of a Long-Term Interest Rate Period, the Bonds will be redeemed or purchased
at the percentage of their principal amount which would be payable upon the
applicable redemption described under "Optional Redemption at a Premium During
Long-Term Interest Rate Period" above.
Notice of Redemption. At least 30 days before each redemption except
"Mandatory Redemption on Each Interest Payment Date During Commercial Paper
Mode" described above, the Trustee will mail a notice of redemption by first-
class mail to each Bondholder at the holder's registered address. Failure to
give any required notice of redemption as to any particular Bonds will not
affect the validity of the call for redemption of any Bonds in respect of
which no failure occurs. Any notice mailed as provided in this paragraph
shall be effective when sent and will be conclusively presumed to have been
given whether or not actually received by the addressee.
Effect of Notice of Redemption. When notice of redemption is required
and given, and when Bonds are to be redeemed without notice, Bonds called for
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<PAGE>
redemption become due and payable on the redemption date at the applicable
redemption price, subject to the Company's right to purchase Bonds as provided
above; in such case when funds are deposited with the Trustee sufficient for
redemption or for purchase, interest on the Bonds to be redeemed or purchased
ceases to accrue as of the date of redemption or purchase.
9. Denominations; Transfer; Exchange. The Bonds are in registered
form without coupons in denominations as follows: (1) when interest is
payable at a Daily, Weekly, or Commercial Paper Rate, $100,000 or any integral
multiple thereof; and (2) when interest is payable at a Long-Term Interest
Rate, $5,000 and integral multiples of $5,000 thereafter. A holder may
transfer or exchange Bonds in accordance with the Indenture. The Trustee may
require a holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted
by the Indenture. Except in connection with the purchase of Bonds tendered
for purchase or purchased in lieu of redemption, the Trustee will not be
required to transfer or exchange any Bond which has been called for redemption
or during the period beginning 15 days before the mailing of notice calling
the Bonds or any portion of the Bonds for redemption and ending on the
redemption date.
10. Persons Deemed Owners. The registered holder of this Bond may be
treated as the owner of it for all purposes.
11. Unclaimed Money. If money for the payment of principal, premium,
interest, or purchase price remains unclaimed for five years, the Trustee will
pay the money to or for the account of the Company. After that, holders
entitled to the money must look only to the Company and not to the Trustee or
the Issuer for payment unless an abandoned property law designates another
person.
12. Discharge Before Redemption or Maturity. If the Company at any
time deposits with the Trustee money or Government Obligations as described in
the Indenture sufficient to pay at redemption or maturity principal of and
interest on the outstanding Bonds, and if the Company also pays all other sums
then payable by the Company under the Indenture, the lien of the Indenture
will be discharged. After discharge, Bondholders must look only to the
deposited money and securities for payment. Government Obligations are
securities backed by the faith and credit of the United States or securities
evidencing ownership interest in such full-faith and credit securities.
13. Amendment, Supplement, Waiver. Subject to certain exceptions, the
Indenture, the Agreement, or the Bonds may be amended or supplemented, and any
past default or compliance with any provision may be waived, with the consent
of the holders of a majority in principal amount of the Bonds then
outstanding. Any such consent shall be Irrevocable and shall bind any
subsequent owner of this Bond or any Bond delivered in substitution for this
Bond. Without the consent of any Bondholder, the Issuer may amend or
supplement the Indenture, the Agreement, or the Bonds as described in the
Indenture, among other things, to cure any ambiguity, omission, defect, or
inconsistency, to provide for uncertificated Bonds in addition to or in place
of certificated Bonds, to provide for a Book-Entry System for the Bonds or to
A-52
<PAGE>
make any change that does not materially adversely affect the rights of any
Bondholder.
14. Defaults and Remedies. The Indenture provides that the
occurrences of certain events constitute Events of Default. If an Event of
Default relating to payment of principal of, interest on, or purchase price of
the Bonds occurs and is continuing, the Bonds shall without further action
become immediately due and payable. Whenever any other Event of Default
occurs and is continuing, the Bonds shall without further action become due
and payable immediately. An Event of Default and its consequences may be
waived as provided in the Indenture. Bondholders may not enforce the
Indenture or the Bonds except as provided in the Indenture. Except as
specifically provided in the Indenture, the Trustee may refuse to enforce the
Indenture or the Bonds unless it receives indemnity satisfactory to it.
Subject to certain limitations, holders of a majority in principal amount of
the Bonds then outstanding may direct the Trustee in its exercise of any trust
or power.
15. No Recourse Against Others. A member, director, officer, or
employee, as such, of the Issuer shall not have any liability for any
obligations of the Issuer or the Company under the Bonds or the Indenture or
for any claim based on such obligations or their creation. Each Bondholder by
accepting a Bond waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Bond.
16. Authentication. This Bond shall not be valid until the Trustee
signs the certificate of authentication.
17. Abbreviations. Customary abbreviations may be used in the name of
a Bondholder or an assignee, such as TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform
Gifts to Minors Act).
A copy of the Indenture may be inspected at the corporate trust office
of the Trustee located at 100 Office Park Circle, Birmingham, Alabama 35223.
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts, conditions,
and things required to exist, happen, and be performed precedent to and in the
execution and delivery of the Indenture and the issuance of this Bond do
exist, have happened and have been performed in due time, form, and manner as
required by law.
This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Indenture until the certificate
of authentication hereon shall have been duly executed by the Trustee.
A-53
<PAGE>
IN WITNESS WHEREOF The Industrial Development Board of the Town of
Columbia has caused this Bond to be executed in its name by the Chairman or
Vice Chairman of its Board of Directors by his manual or facsimile signature
and attested by the manual or facsimile signature of its Secretary or
Assistant and its corporate seal to be hereunto affixed or printed hereon.
Date of Authentication: ,
THE INDUSTRIAL DEVELOPMENT BOARD OF
TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
Attest:
Secretary
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION
Trustee, certifies that this is one of the
Bonds referred to in the Indenture
By:
Authorized Signature
A-54
<PAGE>
The following abbreviations, when used in the inscription on the face of the
within Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM- as tenants in UNIF GIFT MIN ACT - Custodian
common (Cust) (Minor)
TEN ENT- as tenants by
the entireties under Uniform Gifts to Minors Act
JT TEN- as joint
tenants with
right of (State)
survivorship
and not as
tenants in
common
Additional abbreviations may also be used though not in list above.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Name and Address of Assignee)
the within Bond and does hereby irrevocably constitute and appoint
attorney to transfer the said Bond on the books kept for registration thereof
with full power of substitution in the premises.
Dated:
Signature guaranteed:
NOTICE: The signature to this
Medallion Number: assignment must correspond with the
*Signature(s) must be guaranteed by name of the registered owner as it
an eligible guarantor institution appears upon the face of the within
which is a member of a recognized Bond in every particular, without
signature guarantee program, i.e., alteration or enlargement or any
Securities Transfer Agents Medallion change whatever.
Program (STAMP), or New York Stock
Exchange Medallion Signature Program
(MSP).
A-55
<PAGE>
Exhibit F
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
to
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION,
as Trustee
INDENTURE OF TRUST
Dated as of October 1, 1995
Relating to
$26,500,000
Pollution Control Revenue Refunding Bonds, 1995 Series E
(Alabama Power Company Project)
<PAGE>
TABLE OF CONTENTS
GRANTING CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION . . . . . . . 4
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . 4
Section 1.02. Rules of Construction . . . . . . . . . . . . . . 8
ARTICLE II
THE BONDS . . . . . . . . . . . . . . 8
Section 2.02. Interest on the Bonds . . . . . . . . . . . . . . 9
Section 2.03. Execution and Authentication . . . . . . . . . . 16
Section 2.04. Bond Register . . . . . . . . . . . . . . . . . . 16
Section 2.05. Registration and Exchange of Bonds; Persons
Treated as Owners . . . . . . . . . . . . . . . . 16
Section 2.06. Mutilated, Lost, Stolen, Destroyed or
Undelivered Bonds . . . . . . . . . . . . . . . . 17
Section 2.07. Cancellation of Bonds . . . . . . . . . . . . . . 17
Section 2.08. Temporary Bonds . . . . . . . . . . . . . . . . . 17
ARTICLE III
REDEMPTION, PURCHASES IN LIEU OF REDEMPTION AND REMARKETING . . 18
Section 3.01. Notices to Trustee . . . . . . . . . . . . . . . 18
Section 3.02. Redemption Dates . . . . . . . . . . . . . . . . 18
Section 3.03. Selection of Bonds to Be Redeemed . . . . . . . . 18
Section 3.04. Redemption Notices . . . . . . . . . . . . . . . 18
Section 3.05. Payment of Bonds Called for Redemption . . . . . 20
Section 3.06. Bonds Redeemed in Part . . . . . . . . . . . . . 20
Section 3.07. Purchase of Bonds in Lieu of Redemption . . . . . 20
Section 3.08. Disposition of Purchased Bonds . . . . . . . . . 20
ARTICLE IV
APPLICATION OF PROCEEDS AND PAYMENT OF BONDS . . . . . 22
Section 4.01. Application of Proceeds . . . . . . . . . . . . . 22
Section 4.02. Payments of Bonds . . . . . . . . . . . . . . . . 23
Section 4.03. Investments of Moneys . . . . . . . . . . . . . . 23
Section 4.04. Moneys Held in Trust . . . . . . . . . . . . . . 24
ARTICLE V
BOOK-ENTRY SYSTEM . . . . . . . . . . . . 24
Section 5.01. Book-Entry System . . . . . . . . . . . . . . . . 24
ARTICLE VI
COVENANTS . . . . . . . . . . . . . . 26
i
<PAGE>
Section 6.01. Payment of Bonds . . . . . . . . . . . . . . . . 26
Section 6.02. Recording and Filing; Further Assurances . . . . 26
Section 6.03. Tax Covenants . . . . . . . . . . . . . . . . . . 26
Section 6.04. Termination of Subordinated Security Interest . . 27
ARTICLE VII
DISCHARGE OF INDENTURE . . . . . . . . . . . 27
Section 7.01. Bonds Deemed Paid; Discharge of Indenture . . . . 27
Section 7.02. Application of Trust Money . . . . . . . . . . . 28
Section 7.03. Repayment to Company . . . . . . . . . . . . . . 28
ARTICLE VIII
DEFAULTS AND REMEDIES . . . . . . . . . . . 28
Section 8.01. Events of Default . . . . . . . . . . . . . . . . 28
Section 8.02. Acceleration . . . . . . . . . . . . . . . . . . 29
Section 8.03. Other Remedies . . . . . . . . . . . . . . . . . 29
Section 8.04. Waiver of Past Defaults . . . . . . . . . . . . . 29
Section 8.05. Control by Majority . . . . . . . . . . . . . . . 29
Section 8.06. Limitation on Suits . . . . . . . . . . . . . . . 29
Section 8.07. Rights of Holders to Receive Payment . . . . . . 30
Section 8.08. Collection Suit by Trustee . . . . . . . . . . . 30
Section 8.09. Trustee May File Proofs of Claim . . . . . . . . 30
Section 8.10. Priorities . . . . . . . . . . . . . . . . . . . 30
Section 8.11. Undertaking for Costs . . . . . . . . . . . . . . 30
ARTICLE IX
TRUSTEE AND REMARKETING AGENT . . . . . . . . . 31
Section 9.01. Duties of Trustee . . . . . . . . . . . . . . . . 31
Section 9.02. Rights of Trustee . . . . . . . . . . . . . . . . 32
Section 9.03. Individual Rights of Trustee . . . . . . . . . . 32
Section 9.04. Trustee's Disclaimer . . . . . . . . . . . . . . 32
Section 9.05. Notice of Defaults . . . . . . . . . . . . . . . 32
Section 9.06. Compensation and Indemnity of Trustee . . . . . . 33
Section 9.07. Eligibility of Trustee . . . . . . . . . . . . . 33
Section 9.08. Replacement of Trustee . . . . . . . . . . . . . 33
Section 9.09. Acceptance of Trust by Successor Trustee . . . . 34
Section 9.10. [reserved] . . . . . . . . . . . . . . . . . . . 35
Section 9.11. Duties of Remarketing Agent . . . . . . . . . . . 35
Section 9.12. Eligibility of Remarketing Agent . . . . . . . . 35
Section 9.13. Replacement of Remarketing Agent . . . . . . . . 35
Section 9.14. Compensation of Remarketing Agent . . . . . . . . 36
Section 9.15. Successor Trustee or Remarketing Agent by
Merger . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE X
AMENDMENTS OF AND SUPPLEMENTS TO INDENTURE . . . . . . 36
Section 10.01. Without Consent of Bondholders . . . . . . . . . 36
Section 10.02. With Consent of Bondholders . . . . . . . . . . . 37
ii
<PAGE>
Section 10.03. Effect of Consents . . . . . . . . . . . . . . . 37
Section 10.04. Notation on or Exchange of Bonds . . . . . . . . 37
Section 10.05. Signing by Trustee of Amendments and
Supplements . . . . . . . . . . . . . . . . . . . 38
Section 10.06. Company Consent Required . . . . . . . . . . . . 38
Section 10.07. Notice to Bondholders . . . . . . . . . . . . . . 38
ARTICLE XI
AMENDMENTS OF AND SUPPLEMENTS TO THE AGREEMENT . . . . . 38
Section 11.01. Without Consent of Bondholders . . . . . . . . . 38
Section 11.02. With Consent of Bondholders . . . . . . . . . . . 38
Section 11.03. Consents by Trustee to Amendments or
Supplements . . . . . . . . . . . . . . . . . . . 39
ARTICLE XII
[reserved] . . . . . . . . . . . . . . 39
ARTICLE XIII
MISCELLANEOUS . . . . . . . . . . . . . 39
Section 13.01. Notices . . . . . . . . . . . . . . . . . . . . . 39
Section 13.02. Bondholders' Consents . . . . . . . . . . . . . . 39
Section 13.03. Appointment of Separate Paying Agent and/or
Tender Agent . . . . . . . . . . . . . . . . . . 40
Section 13.04. Limitation of Rights . . . . . . . . . . . . . . 40
Section 13.05. Severability . . . . . . . . . . . . . . . . . . 40
Section 13.06. Payments Due on Non-Business Days . . . . . . . . 40
Section 13.07. Governing Law . . . . . . . . . . . . . . . . . . 40
Section 13.08. Captions . . . . . . . . . . . . . . . . . . . . 40
Section 13.09. No Recourse Against Issuer's Officers . . . . . . 41
Section 13.10. Limitation of Liability . . . . . . . . . . . . . 41
Section 13.11. Counterparts . . . . . . . . . . . . . . . . . . 41
EXHIBIT A . . . . . . . . . . . . . . . . . . . . . . . . . . Form of Bond
iii
<PAGE>
INDENTURE OF TRUST
THIS INDENTURE OF TRUST made and entered into as of October 1, 1995, by
and between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF COLUMBIA, a public
corporation organized and existing under the laws of the State of Alabama (the
"Issuer"), and SOUTHTRUST BANK OF ALABAMA, NATIONAL ASSOCIATION, a national
banking association 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");
W I T N E S S E T H:
WHEREAS, under Act No. 648 enacted at the 1949 Regular Session of the
Alabama Legislature, as heretofore amended and supplemented by Act No. 1893
enacted at the 1971 Regular Session of the Alabama Legislature and Act No. 510
enacted at the 1982 Regular Session of the Alabama Legislature (Act No. 648,
as amended and supplemented, being herein called the "Act") the Issuer has the
following, among other powers:
(a) to acquire, whether by construction, purchase, exchange,
gift, lease or otherwise, and to enlarge, improve, replace, equip and
maintain, one or more pollution control facilities, including all real
and personal property deemed necessary or desirable in connection
therewith,
(b) to issue its revenue bonds to pay the cost of pollution
control facilities, such bonds to be payable solely from the revenues
and receipts derived from the leasing or sale by the Issuer of such
pollution control facilities,
(c) to lease or sell to others and otherwise dispose of all or
any portion of such pollution control facilities, and
(d) to issue its refunding bonds for the purpose of paying the
principal of, premium, if any, and accrued interest on, its outstanding
revenue bonds;
WHEREAS, in order to promote the health, safety and prosperity of the
citizens of the State of Alabama through the protection of its air and water
resources, the Issuer has undertaken to acquire, construct, install, equip and
sell to Alabama Power Company (the "Company") facilities or portions thereof,
designed for the abatement or control of air and water pollution, and the
disposal of sewage and solid wastes at the Company's Joseph M. Farley Nuclear
Plant, which is located within the geographical area of operation of the
Issuer in Houston County, Alabama, which facilities comprise the Project and
are generally described in Exhibit A to the Original Agreement described
below, and in furtherance of the above-mentioned purposes, the Issuer entered
into an Installment Sale Agreement dated as of May 1, 1978 (the "Initial
Agreement"), a First Supplemental Agreement thereto dated as of November 1,
1984, a Second Supplemental Agreement thereto dated as of December 1, 1984, a
Third Supplemental Agreement dated as of June 1, 1985, a Fourth Supplemental
Agreement dated as of December 1, 1985, a Fifth Supplemental Agreement dated
as of December 31, 1985, a Sixth Supplemental Agreement dated as of November
1, 1986 and a Seventh Supplemental Agreement dated as of June 1, 1993 (the
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Initial Agreement, as so supplemented, being hereinafter called the "Original
Agreement"), a Supplementary Installment Sale Agreement dated as of September
1, 1994 (the "First Supplementary Agreement"), a Second Supplementary
Agreement dated as of May 1, 1995 (the "Second Supplementary Agreement"), and
a Third Supplementary Agreement dated as of May 1, 1995 (the "Third
Supplementary Agreement"), with the Company providing for the undertaking by
the Issuer to acquire, construct, install, equip and sell to the Company the
Project;
WHEREAS, the Original Agreement provided that, in order to finance the
Project, the Issuer would issue and sell its Pollution Control Revenue Bonds
(Alabama Power Company Farley Plant Project) in one or more series and that
the Issuer would sell the Project (including improvements with respect to the
Project) to the Company for the purchase price stated in the Original
Agreement;
WHEREAS, in order to finance and refinance a portion of the costs of the
Project, the Issuer has heretofore issued various series of its revenue bonds
including $81,500,000 aggregate principal amount of its Pollution Control
Revenue Refunding Bonds, Series E (Alabama Power Company Farley Plant Project)
(the "Series E Bonds");
WHEREAS, the Issuer and the Company have entered into a Fourth
Supplementary Installment Sale Agreement dated of as October 1, 1995 (the
"Fourth Supplementary Agreement") providing that for the purposes therein set
forth, the Issuer will issue and sell its Pollution Control Revenue Refunding
Bonds, 1995 Series C (Alabama Power Company Project);
WHEREAS, the Issuer and the Company have also entered into a Sixth
Supplementary Installment Sale Agreement dated of as October 1, 1995 (the
"Sixth Supplementary Agreement") providing that for the purposes therein set
forth, the Issuer will issue and sell its Pollution Control Revenue Refunding
Bonds, 1995 Series E (Alabama Power Company Project);
WHEREAS, pursuant to and in accordance with the provisions of the Act,
the Issuer now intends to issue its Pollution Control Revenue Refunding Bonds,
1995 Series E (Alabama Power Company Project) in the aggregate principal
amount of $26,500,000 (the "Bonds") for the purpose of refunding a portion of
the Series E Bonds;
WHEREAS, the execution and delivery of this Indenture of Trust (the
"Indenture"), and the issuance of the Bonds under the Act as herein provided
have been in all respects duly and validly authorized by proceedings duly
passed on and approved by the Issuer;
WHEREAS, all other acts, conditions and things required by the
Constitution and laws of the State of Alabama 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
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order to make the Agreement a valid and binding agreement in accordance with
its terms;
WHEREAS, the Company has agreed to make installment purchase payments to
the Issuer pursuant to the Agreement in amounts sufficient to pay the
principal, purchase price, premium, if any, and interest on the Bonds, all as
hereinafter defined;
Accordingly, the Issuer and the Trustee agree as follows for the benefit
of each other and for the benefit of the holders of the Bonds issued pursuant
to this Indenture.
GRANTING CLAUSE
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 premiums, if any, thereon and the Purchase Price (hereinafter
defined) therefor 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, 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,
including the Subordinated Security Interest provided for in the Agreement,
and all moneys receivable thereunder, except for the Unassigned Rights, and
all funds held by the Trustee hereunder (other than moneys held for the
purchase of Bonds which have not been presented for payment) as security for
the payment of the Bonds and the fees, charges and expenses of the Trustee as
aforesaid and the satisfaction of any other obligation assumed by the Issuer
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 and purchase price of, premium, if any,
and interest on the Bonds due or to become due thereon, at the times and in
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the manner mentioned in the Bonds, and shall perform all the covenants and
conditions required of it by this Indenture, and shall pay or cause to be paid
to the Trustee, any additional paying agents and the Remarketing Agent all
sums of money due or to become due to them in accordance with the terms and
provisions hereof, then upon such final payments 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; 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 AND RULES OF CONSTRUCTION
Section 1.01. Definitions. For all purposes of this Indenture,
unless the context requires otherwise, the following terms shall have the
following meanings:
"Act" means Act No. 648 enacted at the 1949 Regular Session of the
Alabama Legislature, as amended from time to time, and presently codified as
Chapter 54 of Title 11 of the Code of Alabama 1975.
"Agreement" means the Sixth Supplementary Installment Sale Agreement
dated as of October 1, 1995, between the Issuer and the Company, as amended
and supplemented from time to time.
"Beneficial Owner" means the purchaser of a beneficial interest in the
Bonds when the Bonds are held by the Securities Depository in the Book-Entry
System, and otherwise means a Bondholder.
"Bondholder" or "holder" means the registered owner of any Bond.
"Bonds" means the Pollution Control Revenue Refunding Bonds, 1995 Series
E (Alabama Power Company Project) issued by the Issuer hereunder in the
aggregate principal amount of $26,500,000.
"Book-Entry System" means the system maintained by the Securities
Depository described in Section 5.01.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii) a
day on which commercial banks in New York, New York, or the city in which the
principal corporate trust office of the Trustee is located, are authorized by
law to close or (iii) a day on which the New York Stock Exchange is closed.
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"Code" means the Internal Revenue Code of 1986, as amended, and the
Treasury regulations thereunder.
"Commercial Paper Mode" means each period of time, comprised of
Commercial Paper Periods, during which Commercial Paper Rates are in effect.
"Commercial Paper Period" means, with respect to any Bond, each period
set under Section 2.02(a)(3).
"Commercial Paper Rate" means the interest rate on each Bond set under
Section 2.02(a)(3).
"Company" means Alabama Power Company, an Alabama corporation, and its
successors and assigns, and any surviving, resulting or transferee entity as
provided in Section 6.3 of the Agreement.
"Company Representative" means any person at the time designated as such
pursuant to the provisions of Section 6.7 of the Original Agreement by a
written certificate furnished to the Trustee and the Issuer containing the
specimen signature of such person and signed on behalf of the Company by any
of its officers. The certificate may designate an alternate or alternates.
"Credit Agreements" means the two Committed Line of Credit Agreements,
each dated October 3, 1995, between the Company and AmSouth Bank of Alabama
and The Bank of Tokyo, Ltd. - Atlanta Agency, respectively, arranged by the
Company pursuant to the provisions of Section 3.5 of the Agreement, or any
line of credit or similar facility or facilities that the Company may enter
into in substitution or replacement of such Committed Line of Credit
Agreements from time to time.
"Daily Rate" means an interest rate on the Bonds set under
Section 2.02(a)(l).
"Event of Default" is defined in Section 8.01.
"Favorable Opinion of Tax Counsel" means an Opinion of Tax Counsel
addressed to the Issuer and to the Trustee to the effect that the action
proposed to be taken is permitted by the laws of the State and by this
Indenture and will not adversely affect any exclusion from gross income for
federal income tax purposes of interest on the Bonds.
"Government Obligations" means (i) noncallable direct obligations of the
United States for which its full faith and credit are pledged,
(ii) noncallable obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States, the timely
payment of which is unconditionally guaranteed as a full faith and credit
obligation of the United States, or (iii) securities or receipts evidencing
ownership interests in obligations or specified portions (such as principal or
interest) of obligations described in (i) or (ii).
"Indenture" means this Indenture of Trust, as it may be amended or
supplemented from time to time in accordance with its terms.
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"Interest Payment Date" is defined in the form of the Bonds appearing in
Exhibit A hereto.
"Interest Period" is defined in the form of the Bonds appearing in
Exhibit A hereto.
"J.J. Kenny Index" means, as of any date, the index of 7-day yields on
high grade tax exempt municipal bonds as determined by J.J. Kenny Co., Inc. or
any successor thereto and published on such date (or, if not published on said
date, on the most recent day prior thereto on which such index shall have been
so published).
"Long-Term Interest Rate" means an interest rate on the Bonds set under
Section 2.02(a)(4).
"Long-Term Interest Rate Period" is defined in Section 2.02(a)(4).
"Maturity Date" means the stated maturity for the Bonds as set forth in
Section 2.01.
"1954 Code" means the Internal Revenue Code of 1954, as amended, and the
Treasury regulations thereunder.
"Opinion of Counsel" means a written opinion of counsel who is
acceptable to the Issuer and the Trustee. The counsel may be an employee of
or counsel to the Issuer, the Trustee or the Company.
"Opinion of Tax Counsel" means an Opinion of Counsel by counsel of
nationally recognized standing in matters relating to the exclusion of
interest from gross income on obligations issued by states and their political
subdivisions or agencies.
The term "outstanding" when used with reference to Bonds, or "Bonds
outstanding" means all Bonds which have been authenticated and delivered by
the Trustee under this Indenture, except the following:
a. Bonds canceled or purchased by or delivered to the Trustee
for cancellation.
b. Bonds that have become due (at maturity or on redemption,
acceleration or otherwise) and for the payment, including interest
accrued to the due date, of which sufficient moneys are held by the
Trustee.
c. Bonds deemed paid by Section 7.01.
d. Bonds in lieu of which others have been authenticated under
Section 2.05 (relating to registration and exchange of Bonds) or
Section 2.06 (relating to mutilated, lost, stolen, destroyed or
undelivered Bonds).
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Bonds purchased by the Trustee or the Company pursuant to tenders or in lieu
of redemption under Article III will continue to be outstanding until the
Company directs the Trustee to cancel them. Bonds purchased pursuant to
tenders or in lieu of redemption and not delivered to the Trustee for payment
are not outstanding, but there will be outstanding Bonds authenticated and
delivered in lieu of such undelivered Bonds as provided in the second
paragraph of Section 2.06.
"Participant" means one of the entities which deposit securities,
directly or indirectly, in the Book-Entry System.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, estate, unincorporated organization
or government or any agency or political subdivision thereof.
"Plant" means the Company's Farley Nuclear Plant located near the Town
of Columbia, Alabama.
The term "principal," when used with reference to any Bonds, includes
any premium payable on those Bonds.
The term "principal corporate trust office", when used with respect to
the Trustee, means the corporate trust office of the Trustee located at 100
Office Park Drive, Birmingham, Alabama 35223.
"Prior Indenture" means the Trust Indenture dated as of May 1, 1978, as
supplemented and amended, under which the Series E Bonds were issued.
"Project" means the air and water pollution control and sewage and solid
waste disposal facilities refinanced from the proceeds of the Series D Bonds,
all as described in Exhibit A to the Original Agreement.
"Purchase Price" means an amount equal to 100% of the principal amount
of any Bond tendered or deemed tendered pursuant to the provisions of
paragraph 6 in the form of the Bonds appearing as Exhibit A hereto, plus
accrued and unpaid interest thereon to the date of purchase.
"Record Date" is defined in the form of the Bonds appearing as Exhibit A
hereto.
"Remarketing Agent" means Morgan Stanley & Co. Incorporated and its
successors under this Indenture.
"Responsible Officer" means any officer or trust officer of the Trustee
assigned by the Trustee to administer its corporate trust matters.
"Securities Depository" means The Depository Trust Company, New York,
New York or its nominee, and its successors and assigns, or any successor
appointed under Section 5.01.
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"Series E Bonds" means the Issuer's Pollution Control Revenue Refunding
Bonds, Series E (Alabama Power Company Farley Plant Project) issued and
outstanding in the aggregate principal amount of $81,500,000.
"Series E Trustee" means SouthTrust Bank of Alabama, National
Association, in its capacity as Trustee for the Series E Bonds.
"State" means the State of Alabama.
"Tax Agreement" means the Tax and Non-Arbitrage Certificate of the
Company dated the date of issuance of the Bonds.
"Trustee" means the entity identified as such in the heading of this
Indenture and its successors under this Indenture.
"Unassigned Rights" means the rights of the Issuer under the second and
third paragraphs of Section 3.1 (relating to fees and expenses and amounts
payable to redeem the Series E Bonds), Section 4.3 (relating to
indemnification) and Section 5.3 (relating to expenses of collection) of the
Agreement.
"Weekly Rate" means an interest rate on the Bonds set under
Section 2.02(a)(2).
Section 1.02. Rules of Construction. Unless the context otherwise
requires,
a. an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles,
b. references to Articles and Sections are to the Articles and
Sections of this Indenture, and
c. the singular form of any word, including the terms defined
in Section 1.01, includes the plural, and vice versa, and any reference
to the male gender includes the female gender.
ARTICLE II
THE BONDS
Section 2.01. Issuance of Bonds: Form; Dating. The Bonds shall be
designated "The Industrial Development Board of the Town of Columbia,
Pollution Control Revenue Refunding Bonds, 1995 Series E (Alabama Power
Company Project)." The total principal amount of Bonds that may be
outstanding shall not exceed $26,500,000. The Bonds shall be substantially in
the form of Exhibit A, which is part of this Indenture, in the denominations
provided for in the Bonds. The Bonds may have notations, legends or
endorsements required by law or usage.
All Bonds will be dated the date of original issuance and delivery and
shall mature, subject to prior redemption, on ________________.
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Bonds issued in exchange for Bonds surrendered for transfer or exchange
or in place of mutilated, lost, stolen, destroyed or undelivered Bonds will
bear interest from the last date to which interest has been paid on the Bonds
being transferred, exchanged or replaced or, if no interest has been paid, as
of the date of their original issuance and delivery. Bonds will be numbered as
determined by the Trustee.
Upon the execution and delivery of this Indenture, the Issuer will
execute and deliver to the Trustee and the Trustee will authenticate the Bonds
and deliver them to the purchaser or purchasers as directed by the Issuer.
Section 2.02. Interest on the Bonds. Interest on the Bonds will be
payable as provided in the Bonds and in this Section. Interest on the Bonds
will initially be payable at the Daily Rate. The interest rate determination
method may be changed by the Company as described in paragraph (b) below. The
methods of determining the various interest rates are as provided in the
following paragraph (a).
(a) Interest Rate Determination Methods. While there exists an Event
of Default under the Indenture, the interest rate on the Bonds will be the
rate on the Bonds on the day before the Event of Default occurred, except that
if interest on any Bond was then payable at a Commercial Paper Rate, the
interest rate for all Bonds then bearing interest at a Commercial Paper Rate
will be the highest Commercial Paper Rate then in effect for any Bond.
(1) Daily Rate. When interest on the Bonds is payable at a
Daily Rate, the Remarketing Agent will set a Daily Rate on or before
11:00 a.m., New York City time, on each Business Day for that Business
Day. Each Daily Rate will be the minimum rate necessary (as determined
by the Remarketing Agent based on the examination of tax-exempt
obligations comparable to the Bonds known by the Remarketing Agent to
have been priced or traded under then-prevailing market conditions) for
the Remarketing Agent to sell the Bonds on the day the rate is set at
their principal amount (without regard to accrued interest). The Daily
Rate for any non-Business Day will be the rate for the last day for
which a rate was set.
(2) Weekly Rate. When interest on the Bonds is payable at a
Weekly Rate, the Remarketing Agent will set a Weekly Rate on or before
5:00 p.m., New York City time, on the last Business Day before the
commencement of a period during which the Bonds bear interest at a
Weekly Rate and on each Tuesday thereafter so long as interest on the
Bonds is to be payable at a Weekly Rate or, if any Tuesday is not a
Business Day, on the next preceding Business Day. Each Weekly Rate will
be the minimum rate necessary (as determined by the Remarketing Agent
based on the examination of tax-exempt obligations comparable to the
Bonds known by the Remarketing Agent to have been priced or traded under
then prevailing market conditions) for the Remarketing Agent to sell the
Bonds on the date the rate is set at their principal amount (without
regard to accrued interest). Thereafter, each Weekly Rate shall apply
to (i) the period beginning on the Wednesday after the Weekly Rate is
set and ending on the following Tuesday or, if earlier, ending on the
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day before the effective date of a new method of determining the
interest rate on the Bonds or (ii) the period beginning on the effective
date of the change to a Weekly Rate and ending on the next Tuesday.
(3) Commercial Paper Rate. During a Commercial Paper Mode,
each Bond will bear interest during the Commercial Paper Period for such
Bond at the Commercial Paper Rate for such Bond. Different Commercial
Paper Periods may apply to different Bonds at any time and from time to
time. Except as otherwise described in this subparagraph (3), the
Commercial Paper Period and Commercial Paper Rate for each Bond will be
determined by the Remarketing Agent no later than 12:15 p.m., New York
City time, on the first day of each Commercial Paper Period.
(i) Determination of Commercial Paper Periods. Each Commercial
Paper Period will be a period of at least one day and not more
than 365 days, determined by the Remarketing Agent to be the
period which, together with all other Commercial Paper Periods for
all Bonds then outstanding, will, in the judgment of the
Remarketing Agent, result in the lowest overall interest expense
on the Bonds over the next 365 days; provided, however, that at
any time at which a Credit Agreement is in effect, the Remarketing
Agent shall not establish any Commercial Paper Period which would
end at a time when no Credit Agreement is in effect. Each
Commercial Paper Period will end on either the day before a
Business Day or on the day before the Maturity Date for such Bond.
However, any Bond purchased on behalf of the Company and remaining
unsold by the Remarketing Agent as of the close of business on the
first day of the Commercial Paper Period for that Bond will have a
Commercial Paper Period of one day or, if that Commercial Paper
Period would not end on a day before a Business Day, a Commercial
Paper Period of the shortest possible duration greater than one
day ending on a day before a Business Day.
In determining the number of days in each Commercial Paper
Period, the Remarketing Agent shall take into account the
following factors: (I) existing short-term tax-exempt market rates
and indices of such short-term rates, (II) the existing market
supply and demand for short-term tax-exempt securities,
(III) existing yield curves for short-term and long-term tax-
exempt securities for obligations of credit quality comparable to
the Bonds, (IV) general economic conditions, (V) industry economic
and financial conditions that may affect or be relevant to the
Bonds, (VI) the number of days in other Commercial Paper Periods
applicable to the Bonds and (VII) such other facts, circumstances
and conditions as the Remarketing Agent, in its sole discretion,
shall determine to be relevant.
(ii) Determination of Commercial Paper Rates. The
Commercial Paper Rate for each Commercial Paper Period for each
Bond shall be the minimum rate necessary (as determined by the
Remarketing Agent based on the examination of tax-exempt
obligations comparable to the Bonds known by the Remarketing Agent
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to have been priced or traded under the then-prevailing market
conditions) for the Remarketing Agent to sell such Bond on the
date and at the time of such determination at its principal amount
(without regard to accrued interest).
(4) Long-Term Interest Rate. The Remarketing Agent will set a
Long-Term Interest Rate on a date no more than 15 days before the
beginning of any period (a "Long-Term Interest Rate Period") in which
interest on any of the Bonds will be payable at a Long-Term Interest
Rate. Each Long-Term Interest Rate will be the minimum rate necessary
(as determined by the Remarketing Agent based on the examination of tax-
exempt obligations comparable to the Bonds known by the Remarketing
Agent to have been priced or traded under then-prevailing market
conditions) for the Remarketing Agent to sell the Bonds on the effective
date of the Long-Term Interest Rate at their principal amount (without
regard to accrued interest).
(5) Failure of Remarketing Agent to Announce Interest Rates on
the Bonds. If the appropriate interest rate or Commercial Paper Period
is not or cannot be determined for whatever reason, the method of
determining interest on the Bonds shall be automatically converted to
the Weekly Rate (without the necessity of complying with the
requirements of Section 2.02(b)) and the interest rate shall be equal to
the J.J. Kenny Index, or such other index (or percentage of an index)
deemed appropriate for tax-exempt securities of the nature of the Bonds
as the Remarketing Agent, with the consent of the Trustee, may have
previously selected, until such time as the method of determining
interest on the Bonds can be changed in accordance with Section 2.02(b);
provided, that if the Bonds are then in a Long-Term Interest Rate
Period, the Bonds shall bear interest at a Weekly Rate, but only if a
Favorable Opinion of Tax Counsel with respect to the change to a Weekly
Rate has been delivered to the Trustee. If such Favorable Opinion of
Tax Counsel has not been delivered, the Bonds shall remain in a Long-
Term Interest Rate Period with an interest rate equal to the interest
rate for the prior Long-Term Interest Rate Period and with a duration
equal to the prior Long-Term Interest Rate Period (or, if earlier, a
Long-Term Interest Rate Period ending on the day before the Maturity
Date for such Bond). The Trustee shall promptly notify the Bondholders
of any such automatic change as set forth in Section 2.02(c).
While Bonds are in a Commercial Paper Mode, during any transition
period caused by an automatic conversion of such Bonds to a Weekly Rate
in accordance with this Subsection (5), Bonds bearing interest at a
Weekly Rate and Bonds bearing interest at a Commercial Paper Rate, as
applicable, shall be governed by the provisions of this Indenture
applicable to such methods of determining interest on the Bonds.
(b) (1) Change in Interest Rate Determination Method. The Company
may change the method of determining the interest rate on the Bonds by
notifying the Issuer, the Trustee, the Remarketing Agent and, if a Book-Entry
System is then in effect for the Bonds, the Securities Depository. Such notice
shall contain (a) the effective date, (b) the proposed interest rate
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determination method, (c) if the change is to a Long-Term Interest Rate or
Rates, the last day of the first such Long-Term Interest Rate Period and, at
the option of the Company, the effective date and last day of any successive
Long-Term Interest Rate Periods (which last day for each Long-Term Interest
Rate Period must be either the day before the related Maturity Date for such
Bonds or a day which is before a Business Day and is at least 365 days after
the effective date), and (d) if the change is to a Commercial Paper Rate, the
termination date of any Credit Agreement which will be in effect during the
Commercial Paper Period. The Long-Term Interest Rate Period shall be the same
duration for all of the Bonds. The notice must be accompanied by a Favorable
Opinion of Tax Counsel, except as described below. Except in the case of the
rescission of the Favorable Opinion of Tax Counsel described in
Section 2.02(e), if the Company's notice complies with this paragraph, the
interest rate on the Bonds will be payable at the new rate on the effective
date specified in the notice until there is another change as provided in this
Section. Notwithstanding anything in this Indenture to the contrary, the
Company must deliver a Favorable Opinion of Tax Counsel whenever there is a
change from a period during which the interest rate on the Bonds is set at
intervals of 365 days or less to a period during which the interest rate on
the Bonds is set at intervals in excess of 365 days, or vice versa.
If the Company wishes to designate successive Long-Term Interest Rate
Periods without specifying the effective dates and last days as described in
the preceding paragraph for the second or any subsequent Long-Term Interest
Rate Periods, it may do so by following the same procedure as for a change in
the interest rate determination method as provided in the foregoing paragraph.
If, 30 days before the end of a Long-Term Interest Rate Period, the
Company has not provided for the next interest rate period, a new Long-Term
Interest Rate Period of the same duration will follow (or if shorter, a Long-
Term Interest Rate Period ending on the day before the Maturity Date for the
Bonds).
When one Long-Term Interest Rate Period follows another, all provisions
of this Indenture applying to a change in the interest rate determination
method will apply, except:
(A) the redemption described under "Mandatory Redemption Upon a
Change in the Method of Determining the Interest Rate on the Bonds" in
the Bonds;
(B) the Company will not be required to deliver a Favorable
Opinion of Tax Counsel if a new Long-Term Interest Rate Period begins as
a result of the Company failing to provide for the next interest rate
period; and
(C) the Company will not be required to deliver a Favorable
Opinion of Tax Counsel if the Company has previously designated a series
of successive Long-Term Interest Rate Periods which, together with the
current Long-Term Interest Rate Period, are substantially equal in
length, and if a Favorable Opinion of Tax Counsel was delivered before
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the first such Long-Term Interest Rate Period in that series which
applies to each successive Long-Term Interest Rate Period.
(2) Limitations. Any change in the method of determining interest on
the Bonds pursuant to paragraph (1) above must comply with the following:
(i) the effective date of a change (or each effective date in
the case of a change from a Commercial Paper Mode) shall be a Business
Day which is at least 15 days (30 days if a Long-Term Interest Rate is
then in effect and the effective date is before the day after the last
day of a Long-Term Interest Rate Period) after the twelfth Business Day
after receipt by the Trustee of the Company's notice of the change;
(ii) if a Long-Term Interest Rate is then in effect, the
effective date of any change must be either the day after the last day
of the Long-Term Interest Rate Period or, except as described in
clause (iii) below, a day on which the Bonds would otherwise be subject
to redemption under the paragraph "Optional Redemption at a Premium
During Long-Term Interest Rate Period" in Section 8 of the Bonds if the
change did not occur; provided that if the effective date of the change
is before the day after the last day of the Long-Term Interest Rate
Period, the Company must also deliver an Opinion of Tax Counsel stating
that, as of the first day on which the Bonds were subject to optional
redemption during such Long-Term Interest Rate Period, the Company's
ability to terminate such Long-Term Interest Rate Period prior to the
day after the last day of such Long-Term Interest Rate Period did not
and does not adversely affect the exclusion of interest on the Bonds
from federal gross income;
(iii) if the Company has previously designated successive Long-
Term Interest Rate Periods, the effective date of each Long-Term
Interest Rate Period must be the day after the last day of the previous
Long-Term Interest Rate Period;
(iv) if a Commercial Paper Mode is then in effect, the effective
date of any change must be either the day after the last day of the
Commercial Paper Mode or, as to any Bond, the day after the last day of
the Commercial Paper Period then in effect (or to be in effect) with
respect to that Bond;
(v) if any Bonds have been called for redemption and the
redemption has not yet occurred, the effective date of the change cannot
be before such redemption date;
(vi) if a Long-Term Interest Rate or a Daily Rate is then in
effect, the effective date of any change cannot occur during the period
after a Record Date and to, but not including, the related Interest
Payment Date; and
(vii) if a Commercial Paper Mode is then in effect, the
Remarketing Agent shall determine Commercial Paper Periods of such
duration that will, in the judgment of the Remarketing Agent, best
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promote an orderly transition on the effective date. After the receipt
by the Trustee of the Company's notice of such change, the day after the
last day of each Commercial Paper Period shall be, with respect to such
Bond, the effective date of the change. The Remarketing Agent shall
promptly give written notice of each such last date and each such
effective date with respect to each Bond to the Issuer, the Company, and
the Trustee.
During any such transition period, Bonds bearing interest at a
Commercial Paper Rate shall be governed by the provisions of this
Indenture applicable to a Commercial Paper Mode and Bonds bearing
interest at a Daily Rate, Weekly Rate or Long-Term Interest Rate, as
applicable, shall be governed by the provisions of this Indenture
applicable to such methods of determining interest on the Bonds.
(c) Notice to Bondholders of Change in Interest Rate Determination
Method. When a change in the interest rate determination method is to be
made, or upon commencement of a new Long-Term Interest Rate Period, the
Trustee will, upon notice from the Company pursuant to Section 2.02(b), notify
the Bondholders by first class mail at least 15 days before the effective date
(or each effective date in the case of an adjustment from a Commercial Paper
Mode) of the change, except that such notice shall be given at least 30 days
prior to the effective date if a Long-Term Interest Rate is in effect and the
effective date is on or before the end of the Long-Term Interest Rate Period.
The notice shall be effective when sent and shall state:
(1) that the interest rate determination method will be changed
and what the new method will be;
(2) the effective date of the new rate; and
(3) that a mandatory redemption or mandatory purchase in lieu
of redemption will result on the effective date of the change as
provided in the Bonds and all the information required by this Indenture
to be included in a notice of redemption set forth in Section 3.04.
The information required in any notice pursuant to this subsection (c)
and the information referred to in any redemption notice (including an
Additional Notice) pursuant to Section 3.04 may be combined in a single notice
if it is sent to Bondholders in the manner and at the time specified under
"Notice of Redemption" in Section 8 of the form of the Bonds.
(d) Calculation of Interest. The Remarketing Agent shall provide the
Trustee and the Company with notice in writing or by telephone (any such
notice by telephone to be delivered to a Responsible Officer of the Trustee)
promptly confirmed by facsimile transmission by 12:30 p.m., New York City
time,
(1) on the first Business Day after a month in which interest
on the Bonds was payable at a Daily Rate, of the Daily Rate for each day
in such month;
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(2) on each day on which a Weekly Rate becomes effective, of
the Weekly Rate;
(3) on the first day of each Commercial Paper Period, of the
length thereof and the Commercial Paper Rate, and, if there is more than
one Commercial Paper Rate then in effect, of the related applicable
principal amounts;
(4) on the first Business Day of a Long-Term Interest Rate
Period, of the Long-Term Interest Rate or Long-Term Interest Rates set
for that period and the related applicable principal amounts; and
(5) on any Business Day preceding any redemption or purchase
date, any interest rate requested by the Trustee in order to enable it
to calculate the accrued interest, if any, due on such redemption or
purchase date.
Using the rates supplied by the notice required by this subsection (d),
the Trustee will calculate the interest payable on the Bonds. The Remarketing
Agent will inform the Trustee and the Company orally at the oral request of
either of them of any interest rate set by the Remarketing Agent. The Trustee
will confirm the effective interest rate by telephone or in writing to any
Bondholder who requests it in any manner.
The setting of the rates and the calculation of interest payable on the
Bonds as provided in this Indenture will be conclusive and binding on all
parties.
(e) Change in Rate Determination Method-Opinions of Counsel.
Notwithstanding any provision of this Section 2.02, no change shall be made in
the interest rate determination method at the direction of the Company
pursuant to Section 2.02(b)(1) hereof if the Trustee shall receive written
notice prior to such change that the Favorable Opinion of Tax Counsel required
under Section 2.02(b)(1) or Section 2.02(a)(5) or, if applicable, the Opinion
of Tax Counsel required by Section 2.02(b)(2)(ii), has been rescinded. If the
Trustee shall have sent any notice to the Bondholders regarding a change in
rate under Section 2.02(c), then in the event of such rescission of, or
failure to deliver, such opinion, the Trustee shall promptly notify all
Bondholders of such rescission.
(f) Notice to Bondholders of Voluntary Termination of Credit
Agreement. If the Trustee receives notice from the Company as provided in
Section 3.5 of the Agreement to the effect that the Company intends to
terminate either or both of the Credit Agreements prior to its or their stated
termination date, the Trustee shall notify the Bondholders by first class mail
at least 15 Business Days prior to the effective date of such termination.
The notice shall be effective when sent and shall state:
(1) that the Company has notified the Trustee that it intends
to terminate either or both of the Credit Agreements;
(2) the effective date of such termination; and
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(3) if the interest is then payable at a Daily Rate or a Weekly
Rate, that the Bondholders have the right to tender Bonds to the Trustee
for purchase as provided in Section 6 of the form of the Bonds set out
in Exhibit A hereto.
Section 2.03. Execution and Authentication. The Bonds shall be
signed on behalf of the Issuer with the manual or facsimile signature of the
Chairman or Vice Chairman of its board of directors, and attested by the
manual or facsimile signature of its Secretary or Assistant Secretary, and the
seal of the Issuer shall be impressed or imprinted on the Bonds by facsimile
or otherwise. All authorized facsimile signatures shall have the same effect
as if manually signed. If an officer of the Issuer whose signature is on a
Bond no longer holds that office at the time the Trustee authenticates the
Bond, the Bond shall nevertheless be valid. Also, if a person signing a Bond
is the proper officer on the actual date of execution, the Bond shall be valid
even if that person is not the proper officer on the nominal date of action.
A Bond shall not be valid for any purpose under this Indenture until the
Trustee manually signs the certificate of authentication on the Bond. Such
signature shall be conclusive evidence that the Bond has been authenticated
under this Indenture.
As a precondition to the initial authentication and delivery of the
Bonds, the Trustee shall receive a request and authorization to the Trustee
from the Issuer, signed by the Chairman or Vice Chairman of the board of
directors of the Issuer, to authenticate and deliver the Bonds to the persons
and in the manner therein described.
Section 2.04. Bond Register. Bonds must be presented at the
principal corporate trust office of the Trustee for registration, transfer,
exchange and payment. Bonds tendered by their holders must be delivered as
specified in the Bonds. The Trustee shall keep a register of Bonds and of
their transfer and exchange, which register shall be open to inspection by the
Issuer and the Company during normal business hours.
Section 2.05. Registration and Exchange of Bonds; Persons Treated as
Owners. Bonds may be transferred only on the register maintained by the
Trustee. Upon surrender for transfer of any Bond to the Trustee, duly
endorsed for transfer or accompanied by an assignment duly executed by the
holder or the holder's attorney duly authorized in writing, the Trustee will
authenticate a new Bond or Bonds of the same maturity, in an equal total
principal amount and registered in the name of the transferee.
Bonds may be exchanged for an equal total principal amount of Bonds of
the same maturity but of different authorized denominations. The Trustee will
authenticate and deliver Bonds that the Bondholder making the exchange is
entitled to receive, bearing numbers not then outstanding.
Except in connection with the purchase of Bonds tendered for purchase or
purchased in lieu of redemption, the Trustee will not be required to transfer
or exchange any Bond called for redemption or during the period beginning 15
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days before the mailing of notice calling the Bonds or any portion of the
Bonds for redemption and ending on the redemption date.
The holder of a Bond shall be the absolute owner of the Bond for all
purposes, and payment of principal, interest or purchase price shall be made
only to or upon the written order of the holder or the holder's legal
representative.
The Trustee will require the payment by a Bondholder requesting exchange
or transfer of any tax or other governmental charge required to be paid in
respect of the exchange or transfer but will not impose any other charge.
Section 2.06. Mutilated, Lost, Stolen, Destroyed or Undelivered
Bonds. If any Bond is mutilated, lost, stolen or destroyed, the Trustee will
authenticate a new Bond of the same maturity and denomination if any mutilated
Bond shall first be surrendered to the Trustee, and if, in the case of any
lost, stolen or destroyed Bond, there shall first be furnished to the Issuer,
the Trustee and the Company evidence of such loss, theft or destruction,
together with an indemnity, satisfactory to them. If the Bond has matured,
instead of issuing a replacement Bond, the Trustee may with the consent of the
Company pay the Bond without requiring surrender of the Bond and make such
requirements as the Trustee deems fit for its protection, including a lost
instrument bond. The Issuer, the Company and the Trustee may charge their
reasonable fees and expenses in this connection.
If a Bond is called for redemption and the Company elects to purchase
the Bond in lieu of redemption as provided in Article III, or if the holder of
a Bond gives irrevocable instructions to the Remarketing Agent for purchase,
and in each case funds are deposited with the Trustee sufficient for the
purchase, the Trustee upon request of the Company or the Remarketing Agent
will authenticate a new Bond in the same maturity and in the same denomination
registered as the Company or the Remarketing Agent may direct and deliver it
to the Company or upon the Company's order, whether or not the Bond purchased
or called for redemption is ever delivered, and the Bond purchased or called
for redemption shall be cancelled on the books of the Trustee, whether or not
said Bond has been delivered to the Trustee. From and after the purchase
date, interest on such Bond shall cease to be payable to the prior holder
thereof, such holder shall cease to be entitled to the benefits or security of
this Indenture and shall have recourse solely to the funds held by the Trustee
for the purchase of such Bond and the Trustee shall not register any further
transfer of such Bond by such prior holder. All funds held by the Trustee for
the purchase of undelivered Bonds shall be held uninvested.
Section 2.07. Cancellation of Bonds. Whenever a Bond is delivered
to the Trustee for cancellation (upon payment, redemption or otherwise), or
for transfer, exchange or replacement pursuant to Section 2.05 or
Section 2.06, the Trustee will promptly cancel and dispose of the Bond in
accordance with the Trustee's policy of disposal; provided, however, that the
Trustee shall not be required to destroy cancelled Bonds.
Section 2.08. Temporary Bonds. Until definitive Bonds are ready for
delivery, the Issuer may execute and the Trustee will authenticate temporary
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Bonds substantially in the form of the definitive Bonds, with appropriate
variations. The Issuer will, without unreasonable delay, prepare and the
Trustee will authenticate definitive Bonds in exchange for the temporary
Bonds. Such exchange shall be made by the Trustee without charge.
ARTICLE III
REDEMPTION, PURCHASES IN LIEU OF REDEMPTION AND REMARKETING
Section 3.01. Notices to Trustee. If the Company wishes that any
Bonds be redeemed pursuant to any optional redemption provision in the Bonds,
the Company will notify the Trustee of the applicable provision, the
redemption date, the principal amount of the Bonds to be redeemed and other
necessary particulars. The Company will give the notice at least 45 days
before the redemption date, or such shorter period of time agreed to by the
Trustee.
Section 3.02. Redemption Dates. The redemption date of Bonds to be
redeemed pursuant to any optional redemption provision in the Bonds will be a
date permitted by the Bonds and specified by the Company in the notice
delivered pursuant to the preceding Section. The redemption date for mandatory
redemptions will be as specified in the Bonds to be redeemed or determined by
the Trustee consistently with the provisions of the Bonds.
Section 3.03. Selection of Bonds to Be Redeemed. Except as provided
in the Bonds, if fewer than all the Bonds are to be redeemed, the Trustee will
select the Bonds to be redeemed by lot or other method it deems fair and
appropriate, except that the Trustee will first select any Bonds owned by the
Company or any of its nominees or held by the Trustee for the account of the
Company or any of its nominees. The Trustee will make the selection from
Bonds not previously called for redemption. For this purpose, the Trustee
will consider each Bond in a denomination larger than the minimum denomination
permitted by the Bonds at the time to be separate Bonds each in the minimum
denomination. Provisions of this Indenture that apply to Bonds called for
redemption also apply to portions of Bonds called for redemption.
Section 3.04. Redemption Notices.
(a) Official Notice of Redemption. The Trustee will give notice of
each redemption as provided in the Bonds and will at the same time give a copy
of the notice to the Remarketing Agent, provided that no redemption notice
shall be given with respect to a redemption under "Mandatory Redemption on
Each Interest Payment Date During Commercial Paper Mode" in Section 8 of the
form of the Bonds. The notice shall identify the Bonds to be redeemed and
will state (1) the redemption date (and, if the Bonds provide that accrued
interest will not be paid on the redemption date, the date it will be paid),
(2) the redemption price, (3) that the Bonds called for redemption must be
surrendered to collect the redemption price, (4) the address at which the
Bonds must be surrendered and (5) that interest on the Bonds called for
redemption ceases to accrue on the redemption date.
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With respect to an optional redemption of any Bonds under "Optional
Redemption at a Premium During Long-Term Interest Rate Period," "Extraordinary
Optional Redemption" or "Optional Redemption During Daily or Weekly Rate
Period" in Section 8 of the form of the Bonds, unless moneys sufficient to pay
the principal of, redemption premium, if any, and interest on the Bonds to be
redeemed shall have been received by the Trustee prior to the giving of such
notice of redemption, such notice may state that said redemption shall be
conditional upon the receipt of such moneys by the Trustee on or prior to the
date fixed for redemption. If such moneys are not received, such notice shall
be of no force and effect, the Issuer shall not redeem such Bonds, the
redemption price shall not be due and payable, and the Trustee shall give
notice, in the same manner in which the notice of redemption was given, that
such moneys were not so received and that such Bonds will not be redeemed.
Failure to give any required notice of redemption as to any particular
Bonds will not affect the validity of the call for redemption of any Bonds in
respect of which no such failure has occurred. Any notice mailed as provided
in the Bonds shall be effective when sent and will be conclusively presumed to
have been given whether or not actually received by any holder.
(b) Additional Notice of Redemption. In addition to the redemption
notice required above, if there is not a Book-Entry System in effect for the
Bonds, further notice (the "Additional Notice") shall be given by the Trustee
as set out below. No defect in the Additional Notice nor any failure to give
all or any portion of the Additional Notice shall in any manner defeat the
effectiveness of a call for redemption if notice is given as prescribed in
paragraph (a) above.
(1) Each Additional Notice of redemption shall contain the
information required in paragraph (a) above for an official notice of
redemption plus (i) the CUSIP numbers of all Bonds being redeemed;
(ii) the date of the Bonds as originally issued; (iii) the interest rate
determination method for, or the rate of interest borne by each Bond
being redeemed; (iv) the maturity date of each Bond being redeemed: and
(v) any other descriptive information needed to identify accurately the
Bonds being redeemed.
(2) Upon the payment of the redemption price of the Bonds being
redeemed, each check or other transfer of funds issued for such purpose
shall bear the CUSIP number identifying, by issue and maturity, the
Bonds being redeemed with the proceeds of such check or other transfer.
(3) Each Additional Notice of redemption shall be sent at least
30 days before the redemption date by registered or certified mail or
overnight delivery service (or by such other means as the Trustee may
have established with the securities depository or information service)
to all registered securities depositories then in the business of
holding substantial amounts of obligations similar to the Bonds (such
depositories now being Depository Trust Company of New York, New York,
Midwest Securities Trust Company of Chicago, Illinois, and Philadelphia
Depository Trust Company of Philadelphia, Pennsylvania) and to one or
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more national information services that disseminate notices of
redemption of obligations such as the Bonds.
The information required in any redemption notice (including an
Additional Notice) pursuant to this Section and the information required in
any notice pursuant to Section 2.02(c) may be combined in a single notice if
it is sent to Bondholders in the manner and at the time specified under
"Notice of Redemption" in Section 8 of the form of the Bonds.
Section 3.05. Payment of Bonds Called for Redemption. Upon
surrender to the Trustee, Bonds called for redemption shall be paid or
purchased in lieu of redemption as provided in this Article at the redemption
price stated in the notice, plus interest accrued to the redemption date, or
at a purchase price equal to principal plus accrued interest to the purchase
date, except that interest payable on Bonds bearing interest at a Daily Rate
will be paid on the fifth Business Day following the redemption date. Bonds
called for redemption and purchased pursuant to a tender before the redemption
date will not be redeemed but will be dealt with as provided below in this
Article.
Section 3.06. Bonds Redeemed in Part. Upon surrender of a Bond
redeemed or purchased in lieu of redemption in part, the Trustee will
authenticate for the holder a new Bond or Bonds in authorized denominations
equal in principal amount to the unredeemed or unpurchased portion of the Bond
surrendered.
Section 3.07. Purchase of Bonds in Lieu of Redemption. When Bonds
are called for redemption pursuant to the paragraphs captioned, "Mandatory
Redemption at Beginning of a New Long-Term Interest Rate Period" or "Mandatory
Redemption Upon a Change in the Method of Determining the Interest Rate on the
Bonds" in Section 8 of the form of the Bonds, the Company may purchase some of
or all the Bonds called for redemption for a price equal to the otherwise
applicable redemption price, if it (or the Remarketing Agent) gives written
notice to the Trustee by 5:00 p.m. New York City Time on the day before the
redemption date that it wishes to purchase the Bonds the principal amount of
which is specified in the notice and furnishes the Trustee sufficient money in
sufficient time for the Trustee to make the purchase on the redemption date.
The Trustee will purchase Bonds called for redemption pursuant to the
paragraph captioned "Mandatory Redemption on Each Interest Payment Date During
Commercial Paper Mode" unless otherwise instructed in writing by the Company,
or unless the Indenture otherwise requires that they be redeemed and
cancelled, before the redemption date. The Trustee will purchase the Bonds
pursuant to this Section only as provided in Section 4.02.
Section 3.08. Disposition of Purchased Bonds. (a) Bonds to be
Remarketed. Bonds purchased pursuant to tenders as provided in the Bonds or
in lieu of redemption as provided in the foregoing Section will be offered for
sale by the Remarketing Agent as provided in this Section except as follows:
(1) Bonds purchased pursuant to a tender after having been
called for redemption under a provision in the Bonds that does not
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provide the Company an option to purchase in lieu of redemption will be
canceled.
(2) Bonds called for redemption under "Mandatory Redemption
Upon a Change in the Method of Determining the Interest Rate on the
Bonds" in Section 8 of the Bonds, which are tendered between the date
notice of redemption is given and the redemption date, may be remarketed
before the redemption date only if the buyer receives a copy of the
redemption notice from the Remarketing Agent.
(3) Bonds will not be offered for sale under this Section
during the continuance of an Event of Default.
(b) Remarketing Effort. Except to the extent the Company directs the
Remarketing Agent not to do so, the Remarketing Agent will offer for sale and
use reasonable efforts to sell all Bonds to be sold as provided in paragraph
(a) above and, when directed by the Company, any Bonds held by the Company.
The sale price of each Bond must be equal to the principal amount of each Bond
plus accrued interest to the purchase date. The Company may direct the
Remarketing Agent from time to time to cease and to resume sales efforts with
respect to some of or all the Bonds. The Remarketing Agent may buy as
principal any Bonds to be offered under this Section.
(c) Notices in Respect of Tenders. When the Trustee receives a notice
from a Bondholder (or a Beneficial Owner through its direct Participant) as
specified in Section 6 of the Bonds for the bondholder (or a Beneficial Owner
through its direct Participant) to tender Bonds, the Trustee will promptly
notify the Remarketing Agent and the Company by facsimile transmission or
telephone, promptly confirmed in writing, of the receipt of such notice, but
in no event later than the following times:
(i) When the Bonds bear interest at a Daily Rate, no later
than 11:15 a.m. (New York City time) on the same Business Day; and
(ii) When the Bonds bear interest at a Weekly Rate, no later
than 11:15 a.m. (New York City time) on the Business Day next succeeding
receipt of such notice.
(d) Delivery of Remarketed Bonds.
(i) The Trustee shall hold all Bonds delivered pursuant to this
Section in trust for the benefit of the owners thereof until moneys
representing the Purchase Price of such Bonds shall have been delivered
to or for the account of or to the order of such Bondholders, and
thereafter, if such Bonds are remarketed, shall deliver replacement
Bonds, prepared by the Trustee in accordance with the directions of the
Remarketing Agent and authenticated by the Trustee, for any Bonds
purchased in accordance with the written directions of the Remarketing
Agent to the Remarketing Agent for delivery to the purchasers thereof.
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(ii) The Remarketing Agent shall advise the Trustee and the
Company in writing or by facsimile transmission, promptly confirmed in
writing, of the principal amount of Bonds which have been remarketed,
together with the denominations and registration instructions (including
taxpayer identification numbers) in accordance with the following
schedule (all times of which are New York City time):
CURRENT METHOD OF INTEREST
RATE DETERMINATION OR, IN
CONNECTION WITH A CHANGE IN
SUCH METHOD, THE NEW METHOD TIME BY WHICH INFORMATION TO BE
OF INTEREST RATE DETERMINATION FURNISHED TO TRUSTEE
Commercial Paper Period 12:15 p.m. on the purchase date
Daily Rate Period 12:15 p.m. on the purchase date
Weekly Rate Period 12:15 p.m. on the purchase
date
Long-Term Interest Rate Period 12:15 p.m. on the purchase
date
(iii) The terms of any sale by the Remarketing Agent shall
provide for the authorization of the payment of the Purchase Price by
the Remarketing Agent to the Trustee in exchange for Bonds registered in
the name of the new Bondholder which shall be delivered by the Trustee
to the Remarketing Agent at or before 2:00 p.m. (New York City time) on
the purchase date if the Purchase Price has been received from the
Remarketing Agent by the time set forth in Section 3.08(e) on the
purchase date. Such payment by the Remarketing Agent pursuant to such
authorization shall be made on such date.
(e) Delivery of Proceeds of Sale. The Remarketing Agent shall deliver
directly to the Trustee an amount equal to the principal amount thereof plus
accrued interest, if any, of the Bonds which the Remarketing Agent has advised
the Trustee have been remarketed pursuant to Section 3.08(d)(ii) no later than
12:30 p.m. (New York City time) on the purchase date.
ARTICLE IV
APPLICATION OF PROCEEDS AND PAYMENT OF BONDS
Section 4.01. Application of Proceeds. The Issuer will cause the
proceeds of the initial sale of the Bonds to be deposited with the Trustee.
On a date to be designated by the Company (but in no event later than December
31, 1995) the Trustee will disburse the proceeds of the initial sale of the
Bonds to the Series E Trustee for deposit in the bond fund under the Prior
Indenture, to be applied to pay a portion of the outstanding principal amount
of the Series E Bonds upon call for redemption.
Pursuant to Section 3.1 of the Agreement, the Company has agreed to pay
to the Series E Trustee the amount in excess of the proceeds of the Bonds
needed to accomplish the refunding described in this Section. Any investment
earnings remaining after the transfer of moneys to the Series E Trustee, will
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be applied to the payment of interest on the Bonds on the next Interest
Payment Date.
Section 4.02. Payments of Bonds. The Trustee will make payments of
principal of, premium, if any, and interest on the Bonds from moneys available
to the Trustee under this Indenture for that purpose. The Trustee will pay
the Purchase Price of tendered Bonds first from the proceeds of the sale of
Bonds under Section 3.08 and second from other moneys available to the Trustee
for that purpose. All moneys received as proceeds of remarketing the Bonds
under Section 3.08 shall be held segregated by the Trustee in a separate and
segregated account.
Section 4.03. Investments of Moneys. The Trustee will invest and
reinvest moneys held by the Trustee as directed by a Company Representative in
writing, to the extent permitted by law, in:
(a) Government Obligations;
(b) Bonds and notes of the Federal Land Bank;
(c) Obligations of the Federal Intermediate Credit Bank;
(d) Obligations of the Federal Bank for Cooperatives;
(e) Bonds and notes of Federal Home Loan Banks;
(f) Negotiable or non-negotiable certificates of deposit, time
deposits or similar banking arrangements, issued by a bank or trust company
(which may be the commercial banking department of the Trustee or any bank or
trust company under common control with the Trustee) or savings and loan
association which are insured by the Federal Deposit Insurance Corporation or
secured as to principal by Government Obligations;
(g) Investments made in or through the Trustee's cash sweep accounts
or other short term investment funds, the assets of which consist of
investments described in clause (a) above; or
(h) Other investments then permitted by law.
The Trustee may make investments permitted by this Article through its
own bond department or the bond department of any bank or trust company under
common control with the Trustee. Investments will be made so as to mature or
be subject to redemption at the option of the holder on or before the date or
dates that the Trustee anticipates that moneys from the investments will be
required. The Trustee, when authorized by the Company, may trade with itself
in the purchase and sale of securities for such investment. Investments will
be registered in the name of the Trustee and held by or under the control of
the Trustee. The Trustee will sell and reduce to cash a sufficient amount of
investments whenever the cash held by the Trustee is insufficient. The Trustee
shall not be liable for any loss from such investments to the extent directed
by the Company Representative and to the extent such directions have been
complied with by the Trustee.
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Section 4.04. Moneys Held in Trust. The Trustee will hold in trust
for the benefit of the Bondholders all moneys held by it for any payment on
the Bonds. The proceeds of the initial sale of the Bonds shall be held in a
separate and segregated account by the Trustee until disbursed as described in
Section 4.01. Money received by the Remarketing Agent or the Trustee from the
sale of a Bond under Section 3.08 or for the purchase of a Bond will be held
segregated from other funds of the Remarketing Agent or the Trustee in trust
for the benefit of the person from whom such Bond was purchased or the person
delivering such purchase money, as the case may be, and will not be invested.
The Trustee shall promptly, but in no event later than 30 days of their
original deposit, apply moneys received from the Company in accordance with
this Indenture and the Tax Agreement and as directed by the Company
Representative.
ARTICLE V
BOOK-ENTRY SYSTEM
Section 5.01. Book-Entry System. The Bonds shall be initially
issued in the name of Cede & Co., as nominee for The Depository Trust Company
as the initial Securities Depository and registered owner of such Bonds, and
held in the custody of the Securities Depository. A single certificate will
be issued and delivered to the Securities Depository for the Bonds. The
Beneficial Owners will not receive physical delivery of Bond certificates
except as provided herein. For so long as the Securities Depository shall
continue to serve as securities depository for such Bonds as provided herein,
all transfers of beneficial ownership interests will be made by book-entry
only, and no investor or other party purchasing, selling or otherwise
transferring beneficial ownership of such Bonds is to receive, hold or deliver
any Bond certificate. The Issuer, the Company and the Trustee will recognize
the Securities Depository or its nominee as the Bondowner of such Bonds for
all purposes, including notices and voting.
The Issuer and the Trustee covenant and agree, so long as The Depository
Trust Company shall continue to serve as Securities Depository for the Bonds,
to meet the requirements of The Depository Trust Company with respect to
required notices and other provisions of the Letter of Representations
executed with respect to the Bonds.
The Issuer, the Trustee and the Remarketing Agent may conclusively rely
upon (i) a certificate of the Securities Depository as to the identity of the
Participants in the Book-Entry-System and (ii) a certificate of any such
Participant as to the identity of, and the respective principal amount of
Bonds beneficially owned by, the Beneficial Owners.
Whenever, during the term of the Bonds, the beneficial ownership thereof
is determined by a book-entry at the Securities Depository, the requirements
in this Indenture of holding, delivering or transferring Bonds shall be deemed
modified to require the appropriate person to meet the requirements of the
Securities Depository as to registering or transferring the book-entry to
produce the same effect. Any provision hereof permitting or requiring
delivery of Bonds shall, while the Bonds are in a Book-Entry System, be
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satisfied by the notation on the books of the Securities Depository in
accordance with applicable law.
The Trustee and the Issuer, at the direction and expense of the Company
and with the consent of the Remarketing Agent, may from time to time appoint a
successor Securities Depository and enter into an agreement with such
successor Securities Depository to establish procedures with respect to the
Bonds not inconsistent with the provisions of this Indenture. Any successor
Securities Depository shall be a "clearing agency" registered under
Section 17A of the Securities Exchange Act of 1934, as amended.
None of the Issuer, the Company, the Trustee nor the Remarketing Agent
will have any responsibility or obligation to any Securities Depository, any
Participants in the Book-Entry System or the Beneficial Owners with respect to
(i) the accuracy of any records maintained by the Securities Depository or any
Participant; (ii) the payment by the Securities Depository or by any
Participant of any amount due to any Beneficial Owner in respect of the
principal amount or redemption or purchase price of, or interest on, any
Bonds; (iii) the delivery of any notice by the Securities Depository or any
Participant; (iv) the selection of the Beneficial Owners to receive payment in
the event of any partial redemption of the Bonds; or (v) any other action
taken by the Securities Depository or any Participant.
Bond certificates are required to be delivered to and registered in the
name of the Beneficial Owner, under the following circumstances:
(a) The Securities Depository determines to discontinue
providing its service with respect to the Bonds and no successor
Securities Depository is appointed as described above. Such a
determination may be made at any time by giving 30 days' notice to the
Issuer, the Company and the Trustee and discharging its responsibilities
with respect thereto under applicable law; or
(b) The Company determines not to continue the Book-Entry
System through a Securities Depository.
The Trustee is hereby authorized to make such changes to the form of
bond attached hereto as Exhibit A which are not inconsistent with this
Indenture and which are necessary or appropriate to reflect that the Book-
Entry System is not in effect, that a successor Securities Depository has been
appointed or that an additional or co-paying agent or tender agent has been
designated pursuant to Section 13.03 hereof.
If at any time, the Securities Depository ceases to hold the Bonds all
references herein to the Securities Depository shall be of no further force or
effect.
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ARTICLE VI
COVENANTS
Section 6.01. Payment of Bonds. The Issuer will promptly pay the
principal or purchase price of, premium, if any, and interest on the Bonds on
the dates and in the manner provided in the Bonds, but only from the amounts
assigned to and held by the Trustee under this Indenture.
Section 6.02. Recording and Filing; Further Assurances. (a) The
Trustee shall cooperate with the Company in causing to be filed all necessary
financing statements and continuation statements related to this Indenture and
all supplements hereto, and such other documents as may be, in the Opinion of
Counsel, necessary to be kept and filed in such manner and in such places as
may be required by law in order to preserve and protect fully the security of
the Bondholders and the rights of the Trustee hereunder.
(b) The Issuer will execute and deliver such supplemental indentures
and such further instruments, and do such further acts, as the Trustee may
reasonably require for the better assuring, assigning and confirming to the
Trustee the amounts assigned under this Indenture for the payment of the
Bonds.
Section 6.03. 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 that end, the Issuer and the Company will comply with all
requirements of the Code and the 1954 Code to the extent applicable to the
Bonds. If at any time the Issuer or the Company is of the opinion that for
purposes of this Section 6.03 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 including, if necessary, the investment of such moneys in
obligations of any state, any political subdivision thereof, or any public
corporation or instrumentality of either thereof, the interest on which is
excludable from gross income under the Code.
Without limiting the generality of the foregoing, the Issuer and the
Company agree that there shall be paid from time to time all amounts required
to be rebated to the United States pursuant to Section 148(f) of the Code and
any temporary, proposed or final Treasury Regulations as may be applicable to
the Bonds from time to time. 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 4.6 of
the Agreement and in the Tax Agreement. The Issuer and the Trustee hereby
covenant and agree to cooperate fully with the Company regarding compliance
with the provisions of this Article VI and Section 4.6 of the Agreement.
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Notwithstanding any provision of this Section, if the Company provides
to the Trustee and the Issuer an Opinion of Tax Counsel to the effect that any
action required under this Section is no longer required, or to the effect
that some further action is required, to maintain the exclusion of interest on
the Bonds from federal gross income, the Trustee and the Issuer may
conclusively rely on such opinion in complying with the provisions of this
Indenture, and the covenants under this Indenture shall be deemed to be
modified to that extent.
Section 6.04. Termination of Subordinated Security Interest. Upon
Satisfaction by the Company of its obligations under Section 3.1 of the
Agreement, the Trustee shall execute and deliver to the Company such documents
as shall be necessary to effect or evidence the termination and release of the
Subordinated Security Interest (as defined in the Agreement).
ARTICLE VII
DISCHARGE OF INDENTURE
Section 7.01. Bonds Deemed Paid; Discharge of Indenture. Any Bond
will be deemed paid for all purposes of this Indenture when (a) payment of the
principal of and interest on the Bond to the due date of such principal and
interest (whether at maturity, upon redemption or otherwise) or the payment of
the Purchase Price either (1) has been made in accordance with the terms of
the Bonds or (2) has been provided for by depositing with the Trustee
(A) moneys sufficient to make such payment and/or (B) Government Obligations
maturing as to principal and interest in such amounts and at such times as
will insure the availability of sufficient moneys to make such payment, and
(b) all compensation and reasonable expenses of the Trustee pertaining to each
Bond in respect of which such deposit is made have been paid or provided for
to the Trustee's satisfaction. When a Bond is deemed paid, it will no longer
be secured by or entitled to the benefits of this Indenture or be an
obligation of the Issuer, except for payment from moneys or Government
Obligations under (a)(2) above and except that it may be tendered if and as
provided in the Bonds and it may be transferred, exchanged, registered,
discharged from registration or replaced as provided in Article II.
Notwithstanding the foregoing, upon the deposit of funds under
clause (a)(2) of the first paragraph of this Section, the purchase price of
tendered Bonds shall be paid from the sale of Bonds under Section 3.08. If
payment of such purchase price is not made from the above sources, payment
shall be made from funds on deposit pursuant to this Section, in which case
such Bonds shall be surrendered to the Trustee and cancelled.
Notwithstanding the foregoing, no deposit under clause (a)(2) of the
first paragraph of this Section shall be deemed a payment of a Bond until the
Company has furnished the Trustee an Opinion of Tax Counsel stating that the
deposit of such cash or Government Obligations will not cause the Bonds to
become "arbitrage bonds" under Section 148 of the Code and until (a) notice of
redemption of the Bond is given in accordance with Article III or, if the Bond
is not to be redeemed or paid within the next 60 days, until the Company has
given the Trustee, in form satisfactory to the Trustee, irrevocable
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instructions (i) to notify, as soon as practicable, the owner of the Bond, in
accordance with Article III, that the deposit required by (a)(2) above has
been made with the Trustee and that the Bond is deemed to be paid under this
Article and stating the maturity or redemption date upon which moneys are to
be available for the payment of the principal of the Bond, and premium, if
any, and interest on such Bond, if the Bond is to be redeemed rather than paid
and (ii) to give notice of redemption not less than 30 nor more than 60 days
prior to the redemption date for such Bond or (b) the maturity of the Bond.
When all outstanding Bonds are deemed paid under the foregoing
provisions of this Section, the Trustee will upon request acknowledge the
discharge of the lien of this Indenture, provided, however that the
obligations relating to the tender for purchase as provided in the Bonds and
obligations under Article II in respect of the transfer, exchange,
registration, discharge from registration and replacement of Bonds shall
survive the discharge of the lien of the Indenture.
No deposit will be made or accepted and no use made of any such deposit
which would cause any Bonds to be treated as "arbitrage bonds" within the
meaning of Section 148 of the Code.
Section 7.02. Application of Trust Money. The Trustee shall hold in
trust money or Government Obligations deposited with it pursuant to the
preceding Section and shall apply the deposited money and the money from the
Government Obligations in accordance with this Indenture only to the payment
of principal of, premium, if any, and interest on the Bonds and to the payment
of the purchase price of tendered Bonds.
Section 7.03. Repayment to Company. The Trustee shall promptly pay
to the Company upon request any excess money or securities held by the Trustee
at any time under this Article and any money held by the Trustee under any
provision of this Indenture for the payment of principal or interest or for
the purchase of Bonds that remains unclaimed for five years.
ARTICLE VIII
DEFAULTS AND REMEDIES
Section 8.01. Events of Default. An "Event of Default" is any of
the following:
(a) Default in the payment of any interest on any Bond when due
and as the same shall become due and payable, which default continues
for five days.
(b) Default in the due and punctual payment of principal on any
Bond when due and payable, whether at maturity, upon redemption, or by
declaration or otherwise.
(c) Default in the payment of the purchase price of any Bond
tendered by its Beneficial Owner pursuant to the Bonds.
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(d) An event of default has occurred and is continuing under
the Agreement.
Section 8.02. Acceleration. Whenever an Event of Default has
occurred and is continuing, the Bonds shall without further action become
immediately due and payable.
Section 8.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may, and upon request of the holders of at least 25%
in principal amount of the Bonds then outstanding shall, pursue any available
remedy by proceeding at law or in equity to collect the principal of or
interest on the Bonds or to enforce the performance of any provision of the
Bonds, this Indenture or the Agreement.
The Trustee, as the assignee of all the right, title and interest of the
Issuer in and to the Agreement, shall enforce each and every right granted to
the Issuer under the Agreement.
The Trustee may maintain a proceeding even if it does not possess any of
the Bonds or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Bondholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
In the event of a bankruptcy or reorganization of the Company, the
Trustee may file a proof of claim on behalf of all Bondholders with respect to
the obligations of the Company pursuant to the Agreement.
Section 8.04. Waiver of Past Defaults. The holders of a majority in
principal amount of the Bonds then outstanding by notice to the Trustee may
waive an existing Event of Default and its consequences. When an Event of
Default is waived, it is cured and stops continuing, but no such waiver shall
extend to any subsequent or other Event of Default or impair any right
consequent to it.
Section 8.05. Control by Majority. The holders of a majority in
principal amount of the Bonds then outstanding may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
of exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 9.01, that the Trustee determines is unduly prejudicial to
the rights of other Bondholders, or would involve the Trustee in personal
liability.
Section 8.06. Limitation on Suits. A Bondholder may not pursue any
remedy with respect to this Indenture or the Bonds unless (a) the holder gives
the Trustee notice stating that an Event of Default is continuing, (b) the
holders of at least 25% in principal amount of the Bonds then outstanding make
a written request to the Trustee to pursue the remedy, (c) such holder or
holders offer to the Trustee indemnity satisfactory to the Trustee against any
loss, liability or expense and (d) the Trustee does not comply with the
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request within 60 days after receipt of the request and the offer of
indemnity.
A Bondholder may not use this Indenture to prejudice the rights of
another Bondholder or to obtain a preference or priority over the other
Bondholders.
Section 8.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any holder
to receive payment of principal of and interest on a Bond, on or after the due
dates expressed in the Bond, or the purchase price of a Bond on or after the
date for its purchase as provided in the Bond, or to bring suit for the
enforcement of any such payment on or after such dates, shall not be impaired
or affected without the consent of the holder.
Section 8.08. Collection Suit by Trustee. If an Event of Default
under Section 8.01(a), (b) or (c) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against
the Company for the whole amount remaining unpaid.
Section 8.09. Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Bondholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the holders in any election of a trustee in bankruptcy or other
person performing similar functions. In the event of a bankruptcy or
reorganization of the Company, the Trustee may file a proof of claim on behalf
of all Bondholders with respect to the obligations of the Company pursuant to
the Agreement.
Section 8.10. Priorities. If the Trustee collects any money
pursuant to this Article, it shall pay out the money in the following order:
FIRST: To the Trustee for amounts to which it is
entitled under Section 9.06.
SECOND: To Bondholders for amounts due and unpaid on the Bonds
for principal and interest, ratably, without
preference or priority of any kind, according to the
amounts due and payable on the Bonds for principal and
interest, respectively.
THIRD: To the Company.
The Trustee may fix a payment date for any payment to the Bondholders.
Section 8.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
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assess reasonable costs, including reasonable attorneys' fees, against any
party litigant in the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This Section does not
apply to a suit by the Trustee, a suit by a holder pursuant to Section 8.07 or
a suit by holders of more than 10% in principal amount of the Bonds then
outstanding.
ARTICLE IX
TRUSTEE AND REMARKETING AGENT
Section 9.01. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise its rights and powers
and use the same degree of care and skill in their exercise as a prudent
person would exercise or use under the circumstances in the conduct of such
person's own affairs.
(b) Except during the continuance of an Event of Default,
(1) the Trustee need perform only those duties that are
specifically set forth in this Indenture and applicable laws and
regulations, and no others and no implied duties or covenants shall be
read into this Indenture against the Trustee, and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed, upon certificates, opinions, requisitions or
any other writing furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own grossly
negligent action, its own grossly negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b)
of this Section,
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts,
(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 8.05, and
(4) 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, if it shall have reasonable grounds for
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believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to all the paragraphs of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
liability or expense, but the Trustee may not require indemnity as a condition
to declaring the principal of and interest on the Bonds to be due immediately
under Section 8.02 or to making any payment of principal or interest on the
Bonds.
(f) The Trustee shall not be liable for interest on any cash held by
it except as the Trustee may agree with the Company or the Issuer with the
consent of the Company.
(g) In addition to the funds and accounts established by this
Indenture, the Trustee may establish such funds and accounts as it deems
necessary and appropriate in order to discharge its duties under this
Indenture.
Section 9.02. Rights of Trustee. Subject to the foregoing Section:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on any certificate of an
appropriate officer or officers of the Issuer or the Company or Opinion
of Counsel.
(c) The Trustee may act through agents or co-trustees but shall
be answerable for the conduct of the same in accordance with the
standards specified in this Indenture.
Section 9.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Bonds and
may otherwise deal with the Issuer or with the Company or its affiliates with
the same rights it would have if it were not Trustee.
Section 9.04. Trustee's Disclaimer. The Trustee makes no
representation as to the validity or adequacy of this Indenture, the Agreement
or the Bonds, and it shall not be responsible for any statement in the Bonds
other than its certificate of authentication.
Section 9.05. Notice of Defaults. If an event occurs which with the
giving of notice or lapse of time or both would be an Event of Default, and if
the event is continuing and if it is known to the Trustee, the Trustee shall
promptly mail to each Bondholder notice of the event. Except in the case of a
default in payment or purchase on any Bonds, the Trustee may withhold the
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notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Bondholders.
Section 9.06. Compensation and Indemnity of Trustee. For acting
under this Indenture, the Trustee shall be entitled to payment of reasonable
fees for its services and reimbursement of advances, reasonable counsel fees
and other expenses reasonably and necessarily made or incurred by the Trustee
as shall be agreed upon in writing by the Trustee and the Company from time to
time in connection with its services under this Indenture.
To secure the payment or reimbursement to the Trustee provided for in
this Section, the Trustee shall have a senior claim, to which the Bonds are
made subordinate, on all money or property held or collected by the Trustee,
except that held under Article VII or otherwise held in trust to pay principal
of and interest on particular Bonds.
The Company has agreed in the Agreement to indemnify the Trustee for,
and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of this trust, including the reasonable
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
Section 9.07. Eligibility of Trustee. This Indenture shall always
have a Trustee that is a corporation or association organized and doing
business under the laws of the United States or any state or the District of
Columbia, is authorized under such laws to exercise corporate trust powers, is
subject to supervision or examination by United States, state or District of
Columbia authority and has a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition. If at any time the Trustee ceases to be eligible in accordance
with this Section, the Trustee will resign immediately as set forth in Section
9.08.
Section 9.08. Replacement of Trustee. (a) The Trustee may resign by
notifying the Issuer and the Company and by mailing notice by first class mail
to the Bondholders.
Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee by an instrument in writing; provided that the
Company may not make such appointment if an Event of Default has occurred and
is continuing, or if an event has occurred and is continuing which, with the
passage of time or the giving of notice or both will become an Event of
Default. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee or any Bondholder who
has been a bona fide holder of a Bond for at least six months may, on behalf
of himself and others similarly situated, petition any such court for the
appointment of a successor trustee. Such court may thereupon, after such
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notice, if any, as it may deem proper and may prescribe, appoint a successor
trustee.
(b) In case at any time either of the following shall occur:
(1) the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.07 and shall fail to resign after written
request therefor by the Company or the Issuer, or
(2) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, the Company shall remove the Trustee and appoint a
successor trustee by an instrument in writing; provided that the Company may
not make such appointment if an Event of Default has occurred and is
continuing, or if an event has occurred and is continuing which, with the
passage of time or the giving of notice or both will become an Event of
Default, or any Bondholder may, on behalf of itself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and may prescribe, remove the
Trustee and appoint a successor trustee.
(c) Except as otherwise provided in this subsection (c), the Company
or holders of a majority in aggregate principal amount of the Bonds at the
time outstanding may at any time remove the Trustee and appoint a successor
trustee by an instrument or concurrent instruments in writing signed by the
Company or such Bondholders, as the case may be. The Company may not remove
the Trustee if an Event of Default has occurred and is continuing or if an
event has occurred and is continuing which, with the passage of time or the
giving of notice will become an Event of Default.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 9.09. The Company shall give written notification to any
rating agency then rating the Bonds of such successor trustee appointed
pursuant to this Section.
Section 9.09. Acceptance of Trust by Successor Trustee. Any
successor trustee appointed as provided in Section 9.08 shall execute,
acknowledge and deliver to the Issuer and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts, duties, and obligations of its
predecessor in the trusts hereunder, with like effect as if originally named
as Trustee herein; but, nevertheless, on the written request of the Issuer or
the request of the successor trustee, the Trustee ceasing to act shall execute
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and deliver an instrument transferring to such successor trustee, upon the
trusts herein expressed, all the rights, power and trusts of the Trustee so
ceasing to act. Upon request of any such successor trustee, the Issuer shall
execute any and all instruments in writing necessary or desirable for more
fully and certainly vesting in and confirming to such successor trustee all
such rights, powers, and duties. Any Trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by
such Trustee to secure the amounts due it as compensation, reimbursement,
expenses, and indemnity afforded to it by Section 9.06.
No successor trustee shall accept appointment as provided in this
Section 9.09 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 9.07.
At the time of appointment, the Company and the successor trustee shall
execute an agreement with respect to the compensation of the successor
trustee.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Issuer or such successor trustee shall give Bondholders
notice of the succession of such trustee to the trusts hereunder in the manner
prescribed in Section 9.08 for the giving of notice of resignation of the
Trustee.
Section 9.10. [reserved].
Section 9.11. Duties of Remarketing Agent. The Remarketing Agent
will set the interest rates on the Bonds and perform the other duties provided
for in Section 2.02 and will remarket Bonds as provided in Section 3.08,
subject to any provisions of a remarketing agreement between the Company and
the Remarketing Agent, which shall control in the case of any conflict with
this Indenture. The Remarketing Agent may for its own account or as broker or
agent for others deal in Bonds and may do anything any other Bondholder may do
to the same extent as if the Remarketing Agent were not serving as such.
Section 9.12. Eligibility of Remarketing Agent. The initial
Remarketing Agent appointed under this Indenture is Morgan Stanley & Co.
Incorporated, New York, New York. The Remarketing Agent will be a bank, trust
company or member of the National Association of Securities Dealers, Inc.
organized and doing business under the laws of the United States or any state
or the District of Columbia, will have a combined capital stock, surplus and
undivided profits of at least $15,000,000 as shown in its most recent
published annual report, will be a Participant in the Securities Depository
and will be authorized by law to perform all the duties imposed upon it by
this Indenture. Any successor Remarketing Agent shall be rated at least
Baa3/P-3 or otherwise qualified by Moody's Investors Service, Inc. or have an
equivalent rating of another rating agency.
Section 9.13. Replacement of Remarketing Agent. The Remarketing
Agent may resign by notifying the Issuer, Trustee, and Company. Such
resignation will take effect on the day a successor Remarketing Agent
appointed in accordance with this Section has accepted the appointment or, if
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no successor has so accepted, 30 days after notice of resignation has been
sent. The Company may remove the Remarketing Agent at any time by an
instrument signed by the Company and filed with the Remarketing Agent, the
Issuer, and the Trustee at least 30 days prior to the effective date of such
removal (which will not in any event occur prior to the appointment of a
successor Remarketing Agent). A new Remarketing Agent may be appointed by the
Company upon the resignation or removal of the Remarketing Agent. The Trustee
shall promptly notify the Bondholders of any change in the Remarketing Agent.
Section 9.14. Compensation of Remarketing Agent. The Remarketing
Agent will not be entitled to any compensation from the Issuer, the Trustee or
any property held under this Indenture but must make separate arrangements
with the Company for compensation.
Section 9.15. Successor Trustee or Remarketing Agent by Merger. If
the Trustee or Remarketing Agent consolidates with, merges or converts into,
or transfers all or substantially all its assets (or, in the case of a bank or
trust company, its corporate trust assets) to another corporation, the
resulting, surviving or transferee corporation without any further act shall
be the successor Trustee or Remarketing Agent, provided that such successor
shall be eligible under the applicable provisions in this Article.
ARTICLE X
AMENDMENTS OF AND SUPPLEMENTS TO INDENTURE
Section 10.01. Without Consent of Bondholders. The Issuer and the
Trustee may amend or supplement this Indenture or the Bonds without notice to
or consent of any Bondholder:
(a) to cure any ambiguity, inconsistency, or formal defect or
omission;
(b) to grant to the Trustee for the benefit of the Bondholders
additional rights, remedies, powers, or authority;
(c) to subject to this Indenture additional collateral or to add
other agreements of the Issuer;
(d) to modify this Indenture or the Bonds to permit
qualification under the Trust Indenture Act of 1939 or any similar
federal statute at the time in effect, or to permit the qualification of
the Bonds for sale under the securities laws of any state of the United
States;
(e) to authorize different authorized denominations of the Bonds
and to make correlative amendments and modifications to this Indenture
regarding exchangeability of Bonds of different authorized
denominations, redemptions of portions of Bonds of particular authorized
denominations and similar amendments and modifications of a technical
nature;
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(f) to increase or decrease the number of days specified for
the giving of notices in Section 2.02 and to make corresponding changes
to the period for notice of redemption of the Bonds; provided that no
decreases in any such number of days shall become effective except while
the Bonds bear interest at a Daily Rate or a Weekly Rate and until 30
days after the Trustee has given notice to the owners of the Bonds;
(g) to provide for an uncertificated system of registering the
Bonds or to provide for the change to or from a Book-Entry System for
the Bonds;
(h) to evidence the succession of a new Trustee or the
appointment by the Trustee or the Issuer of a co-trustee; or
(i) to make any change (including a change in Section 4.01 to
reflect any amendment to the Code or interpretations thereof by the
Internal Revenue Service) that does not materially adversely affect the
rights of any Bondholder.
Section 10.02. With Consent of Bondholders. If an amendment of or
supplement to this Indenture or the Bonds without any consent of Bondholders
is not permitted by the preceding Section, the Issuer and the Trustee may
enter into such amendment or supplement without prior notice to any
Bondholders but with the consent of the holders of at least a majority in
principal amount of the Bonds then outstanding. However, without the consent
of each Bondholder affected, no amendment or supplement may (a) extend the
maturity of the principal of, or interest on, any Bond, (b) reduce the
principal amount of, or rate of interest on, any Bond, (c) effect a privilege
or priority of any Bond or Bonds over any other Bond or Bonds, (d) reduce the
percentage of the principal amount of the Bonds required for consent to such
amendment or supplement, (e) impair the exclusion from federal gross income of
interest on any Bond, (f) eliminate the holders' rights to tender the Bonds,
or any mandatory redemption of the Bonds, extend the due date for the purchase
of Bonds tendered by the holders thereof or call for mandatory redemption or
reduce the purchase or redemption price of such Bonds, (g) create a lien
ranking prior to or on a parity with the lien of this Indenture on the
property described in the Granting Clause of this Indenture, or (h) deprive
any Bondholder of the lien created by this Indenture on such property. In
addition, if moneys or Government Obligations have been deposited or set aside
with the Trustee pursuant to Article VII for the payment of Bonds and those
Bonds shall not have in fact been actually paid in full, no amendment to the
provisions of that Article shall be made without the consent of the holder of
each of those Bonds affected.
Section 10.03. Effect of Consents. Any consent received pursuant to
Section 10.02 will bind each Bondholder delivering such consent and each
subsequent holder of a Bond or portion of a Bond evidencing the same debt as
the consenting holder's Bond.
Section 10.04. Notation on or Exchange of Bonds. If an amendment or
supplement changes the terms of a Bond, the Trustee may require the holder to
deliver it to the Trustee. The Trustee may place an appropriate notation on
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the Bond about the changed terms and return it to the holder. Alternatively,
if the Trustee, the Issuer and the Company determine, the Issuer in exchange
for the Bond will issue and the Trustee will authenticate a new Bond that
reflects the changed terms.
Section 10.05. Signing by Trustee of Amendments and Supplements. The
Trustee will sign any amendment or supplement to the Indenture or the Bonds
authorized by this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities, or immunities of the Trustee. If it
does, the Trustee may, but need not, sign it. In signing an amendment or
supplement, the Trustee will be entitled to receive and (subject to Section
9.01) will be fully protected in relying on an Opinion of Counsel stating that
such amendment or supplement is authorized by this Indenture.
Section 10.06. Company Consent Required. An amendment or supplement
to this Indenture or the Bonds shall not become effective unless the Company
delivers to the Trustee its written consent to the amendment or supplement.
Section 10.07. Notice to Bondholders. The Trustee shall cause notice
of the execution of each supplement or amendment to this Indenture or the
Agreement to be mailed to the Bondholders. The notice will at the option of
the Trustee, either (i) briefly state the nature of the amendment or
supplement and that copies of it are on file with the Trustee for inspection
by Bondholders or (ii) enclose a copy of such amendment or supplement.
ARTICLE XI
AMENDMENTS OF AND SUPPLEMENTS TO THE AGREEMENT
Section 11.01. Without Consent of Bondholders. The Issuer may enter
into, and the Trustee may consent to, any amendment of or supplement to the
Agreement, or may waive compliance by the Company of any provision of the
Agreement, without notice to or consent of any Bondholder, if the amendment,
supplement, or waiver is required or permitted (a) by the provisions of the
Agreement or this Indenture (including in connection with transactions
permitted by Section 6.3 of the Original Agreement, relating to maintenance of
the Company's existence), (b) to cure any ambiguity, inconsistency or formal
defect or omission, (c) to identify more precisely the Project, (d) in
connection with any authorized amendment of or supplement to this Indenture or
(e) to make any change that does not materially adversely affect the rights of
any Bondholder.
Section 11.02. With Consent of Bondholders. If an amendment of or
supplement to the Agreement without any consent of Bondholders is not
permitted by the foregoing Section, the Issuer may enter into, and/or the
Trustee may consent to (as the case may be), such amendment or supplement, or
may waive compliance by the Company of any provision of the Agreement, without
notice to any Bondholder but with the consent of the holders of at least a
majority in principal amount of the Bonds then outstanding. However, without
the consent of each Bondholder affected, no amendment, supplement or waiver
may result in anything described in the lettered clauses of Section 10.02.
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<PAGE>
Section 11.03. Consents by Trustee to Amendments or Supplements. The
Trustee will consent to any amendment or supplement to the Agreement
authorized by this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities, or immunities of the Trustee. If it
does, the Trustee may, but need not, sign it. In signing a consent to an
amendment or supplement, the Trustee shall be entitled to receive and (subject
to Section 9.01) shall be fully protected in relying on an Opinion of Counsel
stating that such amendment or supplement is authorized by this Indenture.
ARTICLE XII
[reserved]
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Notices. (a) Any notice, request, direction,
designation, consent, acknowledgment, certification, appointment, waiver, or
other communication required or permitted by this Indenture or the Bonds must
be in writing except as expressly provided otherwise in this Indenture or the
Bonds.
(b) Any notice or other communication shall be sufficiently given and
deemed given when delivered by hand or mailed by first-class mail, postage
prepaid, addressed as follows: if to the Issuer, if by mail to the Chairman
of the Board of Directors, at Town Hall, Columbia, Alabama 36319; if to the
Trustee, to P. O. Box 2554, Birmingham, Alabama 35290, Attention: Corporate
Trust Department; if to the Company, to 600 North 18th Street, Birmingham,
Alabama 35203, Attention: Treasurer; and if to the Remarketing Agent, to
Morgan Stanley & Co. Incorporated, 1221 Avenue of the Americas, New York, New
York 10020, Attention: Janet Salem. Any addressee may designate additional
or different addresses for purposes of this Section.
Section 13.02. Bondholders' Consents. Any consent or other
instrument required by this Indenture to be signed by Bondholders may be in
any number of concurrent documents and may be signed by a Bondholder or by the
holder's agent appointed in writing. Proof of the execution of such
instrument or of the instrument appointing an agent and of the ownership of
Bonds, if made in the following manner, shall be conclusive for any purposes
of this Indenture with regard to any action taken by the Trustee under the
instrument:
(a) The fact and date of a person's signing an instrument may be
proved by the certificate of any officer in any jurisdiction who by law
has power to take acknowledgments within that jurisdiction that the
person signing the writing acknowledged before the officer the execution
of the writing, or by an affidavit of any witness to the signing.
(b) The fact of ownership of Bonds, the amount or amounts,
numbers and other identification of such Bonds and the date of holding
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<PAGE>
shall be proved by the registration books kept pursuant to this
Indenture.
In determining whether the holders of the required principal amount of
Bonds outstanding have taken any action under this Indenture, Bonds owned by
the Company or any person controlling, controlled by or under common control
with the Company shall be disregarded and deemed not to be outstanding. In
determining whether the Trustee shall be protected in relying on any such
action, only Bonds which the Trustee knows to be so owned shall be
disregarded.
Any consent or other instrument shall be irrevocable and shall bind any
subsequent owner of such Bond or any Bond delivered in substitution therefor.
Section 13.03. Appointment of Separate Paying Agent and/or Tender
Agent. If, at any time, the Securities Depository ceases to hold the Bonds,
with the effect that the Bonds are no longer subject to the Book-Entry System,
then the Issuer and the Trustee, acting at the request of the Company, may
appoint one or more banks or trust companies to act as paying agent and/or
tender agent for the Bonds hereunder. Any such paying agent or tender agent
shall be a bank or trust company organized under the laws of the United States
of America or any state thereof, shall have a reported capital and surplus of
at least $100,000,000 and a corporate trust office located in New York, New
York at which Bonds may be presented for payment or purchase and shall perform
such duties and responsibilities as may be delegated to it hereunder. If such
a paying agent or tender agent is appointed, then all references herein to the
"Trustee" shall include such paying agent or tender agent to the extent of the
duties performed by such entity.
Section 13.04. Limitation of Rights. Nothing expressed or implied in
this Indenture or the Bonds shall give any person other than the Trustee,
Issuer, Company, Remarketing Agent, and the Bondholders any right, remedy or
claim under or with respect to this Indenture.
Section 13.05. Severability. If any provision of this Indenture
shall be determined to be unenforceable, that shall not affect any other
provision of this Indenture.
Section 13.06. Payments Due on Non-Business Days. If a payment date
is not a Business Day at the place of payment, then payment may be made at
that place on the next Business Day, and no interest shall accrue for the
intervening period.
Section 13.07. Governing Law. This Indenture shall be governed
exclusively by and construed in accordance with the applicable laws of the
State.
Section 13.08. Captions. The captions in this Indenture are for
convenience only and do not define or limit the scope or intent of any
provisions or Sections of this Indenture.
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<PAGE>
Section 13.09. No Recourse Against Issuer's Officers. No member,
director, officer, agent, or employee of the Issuer shall be individually or
personally liable for any payment on the Bonds or be subject to any personal
liability or accountability by reason of the issuance of the Bonds, but this
Section shall not relieve any such officer, director, member, agent, or
employee from the performance of any official duty provided by law or this
Indenture.
Section 13.10. Limitation of Liability. Notwithstanding anything
contained in this Indenture to the contrary, the Bonds shall be limited
obligations of the Issuer and shall be payable solely from the revenues and
receipts and other amounts received by or on behalf of the Issuer pursuant to
the Agreement or the First Mortgage Bonds.
Section 13.11. Counterparts. This Indenture may be signed in several
counterparts. Each will be an original, but all of them together constitute
the same instrument.
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<PAGE>
IN WITNESS WHEREOF, The Industrial Development Board of the Town of
Columbia has caused this Indenture to be signed in its name and its seal to be
hereunto affixed and attested by its duly authorized officers, respectively,
and SouthTrust Bank of Alabama, National Association, to evidence its
acceptance of the trust created hereunder, has caused this Indenture to be
signed in its name and its seal to be hereunto affixed and attested by its
duly authorized officers, respectively, all as of the day and year first above
written.
THE INDUSTRIAL DEVELOPMENT BOARD OF THE
TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
ATTEST:
Secretary
SOUTHTRUST BANK OF ALABAMA, NATIONAL
ASSOCIATION, as Trustee
[SEAL]
By:
Title:
ATTEST:
By:
Title:
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<PAGE>
DRAFT
EXHIBIT A 9/27/95
[FORM OF BOND]
UNITED STATES OF AMERICA
STATE OF ALABAMA
No. __________ $
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE TOWN OF COLUMBIA
POLLUTION CONTROL REVENUE REFUNDING BOND, 1995 SERIES E
(ALABAMA POWER COMPANY PROJECT)
TYPE OF INTEREST
MATURITY DATE DATED DATE CUSIP RATE PERIOD
October 1, 2022 October 3, 1995 197210 AP2 Daily
REGISTERED OWNER:
PRINCIPAL AMOUNT:
The Industrial Development Board of the Town of Columbia (the "Issuer"),
a public corporation organized and existing under the laws of the State of
Alabama, hereby promises to pay, solely from the sources described in this
Bond, to the Registered Owner identified above, or registered assigns, on the
Maturity Date stated above (or if this Bond is called for earlier redemption
as described herein, on the redemption date) the principal amount identified
above and to pay interest as provided in this Bond.
1. Indenture; Agreement. This Bond is one of the bonds (the
"Bonds"), limited to $26,500,000 in principal amount, issued under the
Indenture of Trust dated as of October 1, 1995 (the "Indenture"), between the
Issuer and SouthTrust Bank of Alabama, National Association, as trustee (the
"Trustee"). The terms of the Bonds include those in the Indenture.
Bondholders are referred to the Indenture for a statement of those terms.
When used with reference to the Bonds, the term "principal" includes any
premium payable on those Bonds. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to them in the Indenture.
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<PAGE>
The Issuer has sold certain air and water pollution control and sewage
treatment and disposal facilities (the "Project") located at the Farley Plant
(the "Plant") of Alabama Power Company (the "Company") to the Company pursuant
to an Installment Sale Agreement dated as of May 1, 1978, between the Issuer
and the Company, as heretofore supplemented and amended, including a Sixth
Supplementary Installment Sale Agreement dated as of October 1, 1995 (the
"Agreement"). Under the Agreement, Company is obligated to pay to the Issuer
amounts sufficient to pay all amounts coming due on the Bonds and other
expenses incurred in connection therewith, and the Issuer has assigned its
rights to such payments under the Agreement to the Trustee as security for the
Bonds. The proceeds of the Bonds will be used to refund certain outstanding
revenue bonds issued to finance and refinance the Project.
The Indenture and the Agreement may be amended, and references to them
include any amendments.
The Issuer has established a book-entry only system of registration for
the Bonds (the "Book-Entry System"). Except as specifically provided
otherwise in the Indenture, a Securities Depository (or its nominee) will be
the registered owner of this Bond. By acceptance of a confirmation of
purchase, delivery or transfer, the Beneficial Owner (if any) of this Bond
shall be deemed to have agreed to this arrangement. If the Securities
Depository (or its nominee) is the registered owner of this Bond, it shall be
treated as the owner of it for all purposes.
2. Source of Payments. The principal or purchase price of, premium,
if any, and interest on the Bonds are limited obligations of the Issuer and,
as provided in the Indenture, are payable solely and only from payments
derived from the sale of the Project to the Company under the Agreement and
from any other moneys held by the Trustee under the Indenture for such
purpose. The Bonds shall not in any respect be a general obligation of the
Issuer, nor shall they be an obligation of the Town of Columbia, Alabama or
the State of Alabama. Neither the faith and credit nor the taxing power of
the Town of Columbia, Alabama, the State of Alabama or any political
subdivision thereof, is pledged to the payment of the principal of the Bonds
or the interest thereon or other costs incident thereto.
3. Interest Rate. Interest on this Bond will be paid at the lesser
of (a) a Daily Rate, a Weekly Rate, a Commercial Paper Rate, or a Long-Term
Interest Rate as selected by the Company and as determined in accordance with
the Indenture and (b) 10%. Interest will initially be payable at a Daily Rate
as set forth in the Indenture. The Company may change the interest rate
determination method from time to time. A change in the method will result in
mandatory redemption of the Bonds (see "Redemption" below). While there
exists an Event of Default under the Indenture, the interest rate on the Bonds
will be the rate on the Bonds on the day before the Event of Default occurred,
except that if interest on any Bond was then payable at a Commercial Paper
Rate, the default rate for all Bonds then bearing interest at a Commercial
Paper Rate will be the highest Commercial Paper Rate then in effect for any
Bond.
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When interest is payable at a Daily, Weekly or Commercial Paper Rate, it
will be computed on the basis of the actual number of days elapsed over a year
of 365 days (366 in leap years), and when payable at a Long-Term Interest Rate
on the basis of a 360-day year of twelve 30-day months. Interest on overdue
principal and, to the extent lawful, on overdue premium and interest will be
payable at the rate on the Bonds on the day before the default occurred.
4. Interest Payment and Record Dates. Interest will accrue on the
unpaid portion of the principal of this Bond from the last date to which
interest was paid, or if no interest has been paid, from the date of the
original issuance of the Bonds until the entire principal amount of this Bond
is paid. When interest is payable at the rate in the first column below,
interest accrued during the period (an "Interest Period") shown in the second
column will be paid on the date (an "Interest Payment Date") in the third
column to holders of record on the date (a "Record Date") in the fourth
column:
INTEREST ACCRUAL INTEREST
RATE PERIOD PAYMENT DATE RECORD DATE
Daily* Calendar month Fifth Business Last Business
Day Day
of the next of the month
month
Weekly* Calendar month First Business Last Business
Day Day
of the next before Interest
month Payment Date
*If there shall be a change from a Daily Rate or a Weekly Rate on a day
other than the first day of a calendar month, the then current Interest Period
relating to such Daily Rate or Weekly Rate shall end on the day immediately
preceding the date on which the new interest rate on the Bonds shall become
effective, which date in the case of a change from a Weekly Rate, shall be the
Interest Payment Date for such Interest Period, for which the Record Date
shall be the immediately preceding Business Day; but in the case of a change
from a Daily Rate, the Interest Payment Date for such Interest Period shall be
the fifth Business Day after the last day of such Interest Period, for which
the Record Date shall be the last Business Day of such Interest Period. If
such new interest rate shall be a Daily Rate or a Weekly Rate, the first
Interest Period relatIng thereto shall begin on the effective date of such new
interest rate and end on the last day of the then current calendar month, for
which the Interest Payment Date and the Record Date shall be as prescribed in
this Table.
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Commercial Paper From 1 to 365 days Day after the Last Business
as determined for last Day
each Bond pursuant to day of before Interest
Section 2.02(a)(3) of Commercial Payment Date
the Indenture Paper Period
("Commercial Paper
Period")
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<PAGE>
INTEREST
RATE INTEREST PERIOD PAYMENT DATE RECORD DATE
Long-Term** Six-month period or Next day (April Fifteenth of the
portion thereof 1 month before the
ending on the last or October 1) Interest Payment
day Date (March 15
of March or September or
September
15)***
"Business Day" is defined in the Indenture. Payment of defaulted interest
will be made to holders of record as of the fifth-to-last Business Day before
payment.
5. Method of Payment. Holders must surrender Bonds to the Trustee to
collect principal at maturity or upon redemption. (See "Tenders" below for
the payment of purchase price of tendered Bonds.) Interest on Bonds bearing
interest at a Commercial Paper Rate is payable only upon presentation of such
Bonds to the Trustee. Interest on Bonds bearing interest at a Daily, Weekly,
or Long-Term Interest Rate will be paid to the registered holder hereof as of
the Record Date by check mailed by first-class mail on the Interest Payment
Date to such holder's registered address. A holder of $1,000,000 or more in
principal amount of Bonds may be paid interest at a Daily, Weekly or
Commercial Paper Rate by wire transfer in immediately available funds to an
account in the continental United States if the holder makes a written request
of the Trustee (in form satisfactory to the Trustee) at least two Business
Days before the Record Date specifying the account address. The notice may
provide that it will remain in effect for later interest payments until
changed or revoked by another written notice. Principal and interest will be
paid in money of the United States that at the time of payment is legal tender
**If there shall be a change from a Long-Term Interest Rate on a day
other than the day after the last day of the then current Long-Term Interest
Rate Period, or if there shall be an early termination of such Long-Term
Interest Rate Period and a new Long-Term Interest Rate shall be set, such
Long-Term Interest Rate Period shall end on the day immediately preceding the
date on which the new interest rate shall become effective, which date shall
be the Interest Payment Date for such Long-Term Interest Rate Period, for
which the Record Date shall be 15 days prior to such Interest Payment Date or,
if sooner, the first day of such Long-Term Interest Rate Period. If such new
interest rate shall be a Daily Rate or a Weekly Rate, the first Interest
Period relating thereto shall begin on the effective date of such new interest
rate and end on the last day of the then current calendar month, for which the
Interest Payment Date and the Record Date shall be prescribed in this Table.
***If an Interest Payment Date occurs less than 15 days after the first
day of a Long-Term Interest Rate Period, the first day of such Long-Term
Interest Rate Period is the Record Date for such interest Payment Date.
A-47
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for payment of public and private debts or by checks or wire transfers payable
in such money. If any payment on the Bonds is due on a non-Business Day, it
will be made on the next Business Day, and no interest will accrue as a
result.
6. Tenders. "Tender" means to require, or the act of requiring, the
Trustee to purchase a Bond at the holder's option under the provisions of this
Section 6 at 100% of the principal amount plus interest accrued to the date of
purchase. During a Daily Rate Period, if a Bond is tendered after the Record
Date and before the Interest Payment Date for that Interest Period, the
Trustee will pay a purchase price of principal plus interest accruing after
the last day of that Interest Period. The holder will receive interest for
that Interest Period by check or wire transfer as described in Section 5
above.
Daily Rate Tender. When interest on the Bonds is payable at a
Daily Rate and a Book-Entry System is in effect, a Beneficial Owner
(through its direct Participant in the Securities Depository) may tender
his interest in a Bond (or portion of Bond) by delivering an irrevocable
written notice or an irrevocable telephone notice, promptly confirmed in
writing, to the Trustee (any such telephone notice to be delivered to a
trust officer of the Trustee) and an irrevocable notice by telephone,
telegraph, or facsimile transmission to the Remarketing Agent, in each
case by 11:00 a.m., New York City time, on a Business Day, stating the
principal amount of the Bond (or portion of Bond being tendered),
payment instructions for the purchase price and the Business Day (which
may be the date the notice is delivered) the Bond (or portion of Bond)
is to be purchased. The Beneficial Owner shall effect delivery of such
Bonds by causing such direct Participant to transfer its interest in the
Bonds equal to such Beneficial Owner's interest on the records of the
Securities Depository to the participant account of the Trustee with the
Securities Depository. Any notice received by the Trustee after 11:00
a.m., New York City time, shall be deemed to have been given on the next
Business Day.
When interest on the Bonds is payable at a Daily Rate and a Book-
Entry System is not in effect, a holder of a Bond may tender the Bond
(or portion of Bond) by delivering the notices as described above (which
shall include the certificate number of the Bond), and shall also
deliver the Bond to the Trustee by 1:00 p.m., New York City time, on the
date of purchase (see additional requirements below).
Weekly Rate Tender. When interest on the Bonds is payable at a
Weekly Rate and a Book-Entry System is in effect, a Beneficial Owner
(through its direct Participant in the Securities Depository) may tender
his interest in a Bond (or portion of Bond) by delivering an irrevocable
written notice or an irrevocable telephone notice, promptly confirmed in
writing, to the Trustee (any such telephone notice to be delivered to a
trust officer of the Trustee) and an irrevocable notice by telephone,
telegraph, or facsimile transmission to the Remarketing Agent, in each
case prior to 5:00 p.m., New York City time on a Business Day stating
the principal amount of the Bond (or portion of Bond) being tendered,
A-48
<PAGE>
payment instructions for the purchase price, and the date, which must be
a Business Day at least seven days after the notice is delivered, on
which the Bond (or portion of Bond) is to be purchased. The Beneficial
Owner shall effect delivery of such Bonds by causing such direct
Participant to transfer its interest in the Bonds equal to such
Beneficial Owner's interest on the records of the Securities Depository
to the participant account of the Trustee with the Securities
Depository.
When interest on the Bonds is payable at a Weekly Rate and a Book-
Entry System is not in effect, a holder of a Bond may tender the Bond
(or portion of Bond) by delivering the notices as described above (which
shall include the certificate number of the Bond), and shall also
deliver the Bond to the Trustee by 1:00 p.m., New York City time, on the
date of purchase (see additional requirements below).
Payment of Purchase Price. The purchase price for a tendered Bond will
be paid in immediately available funds to the registered owner of the Bond by
the close of business on the date of purchase.
7. Delivery Address; Additional Delivery Requirements. Notices in
respect of tenders and Bonds tendered must be delivered to the Trustee as
follows:
SouthTrust Bank of Alabama, National Association
P. O. Box 2554
Birmingham, Alabama 35290
Attention: Corporate Trust Department
Telephone: (205) 254-5017
Fax: (205) 254-4180
Notices in respect of tenders shall be delivered to the Remarketing
Agent as follows:
Morgan Stanley & Co. Incorporated
1221 Avenue of the Americas
New York, New York 10020
Attention: Janet Salem
Telephone: (212) 296-5714
Fax: (212) 296-5713
The delivery addresses or telephone numbers of the Trustee or the Remarketing
Agent may be changed by notice mailed by first class mail to the Bondholders
at their registered addresses.
All tendered Bonds must be accompanied by an instrument of transfer
satisfactory to the Trustee, executed in blank by the registered owner or his
duly authorized attorney, with the signature guaranteed by an eligible
guarantor institution.
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<PAGE>
Limitation on Tenders. No Bonds may be tendered while they bear
interest at a Commercial Paper Rate or a Long-Term Interest Rate.
Irrevocable Notice Deemed to be Tender of Bond; Undelivered Bonds. The
giving of notice by an owner of a Bond as provided in Section 6 constitutes
the irrevocable tender for purchase of each Bond (or portion thereof) with
respect to which such notice was given, irrespective of whether such Bond was
delivered as provided in Section 6. The determination of the Trustee as to
whether a notice of tender has been properly delivered shall be conclusive and
binding upon the Bondholders.
The Trustee may refuse to accept delivery of any Bond for which a proper
instrument of transfer has not been provided. If any owner of a Bond who gave
notice fails to deliver his Bond to the Trustee at the place and on the
applicable date and time specified, or fails to deliver his Bond properly
endorsed, his Bond shall constitute an undelivered Bond as described in
Section 2.06 of the Indenture. BY ACCEPTANCE OF THIS BOND, THE OWNER AGREES
TO SELL AND SURRENDER THIS BOND, PROPERLY ENDORSED, TO THE TRUSTEE AFTER THE
GIVING OF IRREVOCABLE NOTICE OF TENDER FOR PURCHASE AS DESCRIBED ABOVE.
8. Redemptions. As provided below, the Company has the right to
purchase Bonds in lieu of certain redemptions. BY ACCEPTANCE OF THIS BOND,
THE OWNER AGREES TO SELL AND SURRENDER THIS BOND, PROPERLY ENDORSED, TO THE
COMPANY IN LIEU OF REDEMPTION UNDER THE CONDITIONS DESCRIBED BELOW. All
redemptions and purchases in lieu of redemption will be made in funds
immediately available on the redemption or purchase date and will be at a
redemption or purchase price of 100% of the principal amount of the Bonds
being redeemed or purchased (unless a premium is required as provided below)
plus interest accrued to the redemption or purchase date, except that interest
accruing at a Daily Rate will be paid on the fifth Business Day following the
redemption or purchase date. Bonds tendered for purchase on a date after a
call for redemption but before the redemption date will be purchased pursuant
to the tender. No purchase of Bonds by the Company or advance use of any
funds to effectuate any such purchase shall be deemed to be a payment or
redemption of the Bonds or of any portion thereof and such purchase will not
operate to extinguish or discharge the indebtedness evidenced by such Bonds.
Optional Redemption at a Premium During Long-Term Interest Rate Period.
During any Long-Term Interest Rate Period of less than or equal to five years,
the Bonds will not be redeemable pursuant to this provision during the Long-
Term Interest Rate Period.
If the Long-Term Interest Rate Period is greater than five years, the
Bonds will not be redeemable for five years after the date on which the Bonds
begin to bear interest at the Long-Term Interest Rate. After the five year
no-call period, the Bonds may be redeemed at any time in whole or in part at
102% of their principal amount. The premium will decline every year on the
anniversary of the date on which the Bonds begin to bear interest at the Long-
Term Interest Rate, by one percentage point until the Bonds are redeemable
without premium.
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As an alternative to and in lieu of the foregoing redemption provisions
if, with respect to any Long-Term Interest Rate Period, a Favorable Opinion of
Tax Counsel is delivered to the Trustee not later than the date of the
establishment of such Long-Term Interest Rate Period, the Bonds may be
redeemed during such Long-Term Interest Rate Period at the option of the
Company in whole or in part at any time after a no-call period, if any,
established by the Remarketing Agent, at the percentages of their principal
amount, plus accrued interest, as follows: The Remarketing Agent shall, given
the duration of the Long-Term Interest Rate Period, determine and inform the
Trustee, on a date which is no later than the establishment of the Long-Term
Interest Rate, the periods during which the Bonds shall not be subject to
redemption (the "Call Protection Period"), the redemption premium or premiums
(the "Call Premiums"), if any, applicable to the redemption of Bonds after the
Call Protection Period, and the period or periods during which the Call
Premiums shall be effective (the "Call Premium Periods") necessary to
establish the Long-Term Interest Rate. Such Call Protection Period, Call
Premiums and Call Premium Periods shall be established in accordance with
optional call redemption provisions which in the judgment of the Remarketing
Agent, are generally accepted as the standard features for obligations such as
the Bonds, given the length of the Long-Term Interest Rate Period.
Extraordinary Optional Redemption. The Bonds may be redeemed in whole
at the option of the Company at any time after the occurrence of any of the
following:
(a) Damage or destruction to the Plant or the Project to such
extent that in the opinion of the Company's board of directors
(expressed in a resolution) filed with the Issuer and the Trustee: (1)
the Plant or the Project, as the case may be, cannot be reasonably
repaired, rebuilt or restored within a period of six months to their
condition immediately preceding such damage or destruction, or (2) the
Company is thereby prevented from carrying on its normal operations at
the Plant for a period of six months.
(b) Loss of title to or use of a substantial part of the Plant
or the Project as a result of the exercise of the power of eminent
domain which, in the opinion of the Company's board of directors
(expressed in a resolution) filed with the Issuer and the Trustee,
results or is likely to result in the Company being thereby prevented
from carrying on its normal operations therein for a period of six
months.
(c) Any event occurs which, in the opinion of the Company's
board of directors (expressed in a resolution), renders the Project or
the Plant so uneconomical that it is abandoned.
Any such redemption shall be on any date within 90 days from the time
the Company files the required resolution and directs that the Bonds are to be
redeemed, which direction must be given, if at all, within 180 days following
the occurrence of one of the events listed above.
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Optional Redemption During Daily or Weekly Rate Period. When interest
on the Bonds is payable at a Daily or Weekly Rate, the Bonds may be redeemed
in whole or in part at the option of the Company, on any Business Day.
Mandatory Redemption at Beginning of a New Long-Term Interest Rate
Period. When the Bonds bear interest at a Long-Term Interest Rate and a new
Long-Term Interest Rate is to be determined, the Bonds will be redeemed or
purchased by the Company in lieu of redemption on the effective date of the
new Long-Term Interest Rate. In the case of a change prior to the day
originally established as the day after the last day of a Long-Term Interest
Rate Period, the Bonds will be redeemed or purchased at the percentage of
their principal amount which would be payable upon the applicable redemption
described under "Optional Redemption at a Premium During Long-Term Interest
Rate Period" above.
Mandatory Redemption on Each Interest Payment Date During Commercial
Paper Mode. When Bonds bear interest at a Commercial Paper Rate, each Bond
will be redeemed or purchased by the Company in lieu of redemption on the
Interest Payment Date for such Bond. If Bonds are scheduled to be redeemed
under the following paragraph, the Bonds will be called under, and redemption
will be governed by, that paragraph and not this paragraph.
Mandatory Redemption Upon a Change in the Method of Determining the
Interest Rate on the Bonds. On the effective date of the change in the method
of determining the interest rate on the Bonds (the four methods being Daily,
Weekly, Commercial Paper, or Long-Term Interest Rates) the Bonds will be
redeemed or purchased by the Company in lieu of redemption on the effective
date of such change. Any such redemption or purchase shall be at a price
equal to 100% of the principal amount of the Bonds, except that in the case of
a change prior to the day originally established as the day after the last day
of a Long-Term Interest Rate Period, the Bonds will be redeemed or purchased
at the percentage of their principal amount which would be payable upon the
applicable redemption described under "Optional Redemption at a Premium During
Long-Term Interest Rate Period" above.
Notice of Redemption. At least 30 days before each redemption except
"Mandatory Redemption on Each Interest Payment Date During Commercial Paper
Mode" described above, the Trustee will mail a notice of redemption by first-
class mail to each Bondholder at the holder's registered address. Failure to
give any required notice of redemption as to any particular Bonds will not
affect the validity of the call for redemption of any Bonds in respect of
which no failure occurs. Any notice mailed as provided in this paragraph
shall be effective when sent and will be conclusively presumed to have been
given whether or not actually received by the addressee.
Effect of Notice of Redemption. When notice of redemption is required
and given, and when Bonds are to be redeemed without notice, Bonds called for
redemption become due and payable on the redemption date at the applicable
redemption price, subject to the Company's right to purchase Bonds as provided
above; in such case when funds are deposited with the Trustee sufficient for
redemption or for purchase, interest on the Bonds to be redeemed or purchased
ceases to accrue as of the date of redemption or purchase.
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9. Denominations; Transfer; Exchange. The Bonds are in registered
form without coupons in denominations as follows: (1) when interest is
payable at a Daily, Weekly, or Commercial Paper Rate, $100,000 or any integral
multiple thereof; and (2) when interest is payable at a Long-Term Interest
Rate, $5,000 and integral multiples of $5,000 thereafter. A holder may
transfer or exchange Bonds in accordance with the Indenture. The Trustee may
require a holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted
by the Indenture. Except in connection with the purchase of Bonds tendered
for purchase or purchased in lieu of redemption, the Trustee will not be
required to transfer or exchange any Bond which has been called for redemption
or during the period beginning 15 days before the mailing of notice calling
the Bonds or any portion of the Bonds for redemption and ending on the
redemption date.
10. Persons Deemed Owners. The registered holder of this Bond may be
treated as the owner of it for all purposes.
11. Unclaimed Money. If money for the payment of principal, premium,
interest, or purchase price remains unclaimed for five years, the Trustee will
pay the money to or for the account of the Company. After that, holders
entitled to the money must look only to the Company and not to the Trustee or
the Issuer for payment unless an abandoned property law designates another
person.
12. Discharge Before Redemption or Maturity. If the Company at any
time deposits with the Trustee money or Government Obligations as described in
the Indenture sufficient to pay at redemption or maturity principal of and
interest on the outstanding Bonds, and if the Company also pays all other sums
then payable by the Company under the Indenture, the lien of the Indenture
will be discharged. After discharge, Bondholders must look only to the
deposited money and securities for payment. Government Obligations are
securities backed by the faith and credit of the United States or securities
evidencing ownership interest in such full-faith and credit securities.
13. Amendment, Supplement, Waiver. Subject to certain exceptions, the
Indenture, the Agreement, or the Bonds may be amended or supplemented, and any
past default or compliance with any provision may be waived, with the consent
of the holders of a majority in principal amount of the Bonds then
outstanding. Any such consent shall be Irrevocable and shall bind any
subsequent owner of this Bond or any Bond delivered in substitution for this
Bond. Without the consent of any Bondholder, the Issuer may amend or
supplement the Indenture, the Agreement, or the Bonds as described in the
Indenture, among other things, to cure any ambiguity, omission, defect, or
inconsistency, to provide for uncertificated Bonds in addition to or in place
of certificated Bonds, to provide for a Book-Entry System for the Bonds or to
make any change that does not materially adversely affect the rights of any
Bondholder.
14. Defaults and Remedies. The Indenture provides that the
occurrences of certain events constitute Events of Default. If an Event of
Default relating to payment of principal of, interest on, or purchase price of
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the Bonds occurs and is continuing, the Bonds shall without further action
become immediately due and payable. Whenever any other Event of Default
occurs and is continuing, the Bonds shall without further action become due
and payable immediately. An Event of Default and its consequences may be
waived as provided in the Indenture. Bondholders may not enforce the
Indenture or the Bonds except as provided in the Indenture. Except as
specifically provided in the Indenture, the Trustee may refuse to enforce the
Indenture or the Bonds unless it receives indemnity satisfactory to it.
Subject to certain limitations, holders of a majority in principal amount of
the Bonds then outstanding may direct the Trustee in its exercise of any trust
or power.
15. No Recourse Against Others. A member, director, officer, or
employee, as such, of the Issuer shall not have any liability for any
obligations of the Issuer or the Company under the Bonds or the Indenture or
for any claim based on such obligations or their creation. Each Bondholder by
accepting a Bond waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Bond.
16. Authentication. This Bond shall not be valid until the Trustee
signs the certificate of authentication.
17. Abbreviations. Customary abbreviations may be used in the name of
a Bondholder or an assignee, such as TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform
Gifts to Minors Act).
A copy of the Indenture may be inspected at the corporate trust office
of the Trustee located at 100 Office Park Circle, Birmingham, Alabama 35223.
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts, conditions,
and things required to exist, happen, and be performed precedent to and in the
execution and delivery of the Indenture and the issuance of this Bond do
exist, have happened and have been performed in due time, form, and manner as
required by law.
This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Indenture until the certificate
of authentication hereon shall have been duly executed by the Trustee.
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IN WITNESS WHEREOF The Industrial Development Board of the Town of
Columbia has caused this Bond to be executed in its name by the Chairman or
Vice Chairman of its Board of Directors by his manual or facsimile signature
and attested by the manual or facsimile signature of its Secretary or
Assistant and its corporate seal to be hereunto affixed or printed hereon.
Date of Authentication: ,
THE INDUSTRIAL DEVELOPMENT BOARD OF
TOWN OF COLUMBIA
[SEAL]
By:
Chairman of the Board of Directors
Attest:
Secretary
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION
Trustee, certifies that this is one of the
Bonds referred to in the Indenture
By:
Authorized Signature
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The following abbreviations, when used in the inscription on the face of the
within Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM- as tenants in UNIF GIFT MIN ACT - Custodian
common (Cust) (Minor)
TEN ENT- as tenants by
the entireties under Uniform Gifts to Minors Act
JT TEN- as joint
tenants with
right of (State)
survivorship
and not as
tenants in
common
Additional abbreviations may also be used though not in list above.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Name and Address of Assignee)
the within Bond and does hereby irrevocably constitute and appoint
attorney to transfer the said Bond on the books kept for registration thereof
with full power of substitution in the premises.
Dated:
Signature guaranteed:
NOTICE: The signature to this
Medallion Number: assignment must correspond with the
*Signature(s) must be guaranteed by name of the registered owner as it
an eligible guarantor institution appears upon the face of the within
which is a member of a recognized Bond in every particular, without
signature guarantee program, i.e., alteration or enlargement or any
Securities Transfer Agents Medallion change whatever.
Program (STAMP), or New York Stock
Exchange Medallion Signature Program
(MSP).
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Exhibit G
Balch & Bingham
1901 Sixth Avenue North
Birmingham, Alabama 35203
205-251-8100
October 13, 1995
Securities and Exchange Commission
Washington, DC 20549
Re: Statement on Form U-1
of Alabama Power Company
(herein called the "Company")
File No. 70-8661
Ladies and Gentlemen:
We have read the statement on Form U-1, as amended, referred to
above and are furnishing this opinion in connection with the
issuance and sale by The Industrial Development Board of the Town
of Columbia (Alabama) of (i) $28,000,000 aggregate principal
amount of its Pollution Control Revenue Refunding Bonds (Alabama
Power Company Project), 1995 Series C, (ii) $27,000,000 aggregate
principal amount of its Pollution Control Revenue Refunding Bonds
(Alabama Power Company Project), 1995 Series D, and (iii)
$26,500,000 aggregate principal amount of its Pollution Control
Revenue Refunding Bonds (Alabama Power Company Project), 1995
Series D (collectively, the "Revenue Bonds").
We are of the opinion that:
(a) the Company is validly organized and duly existing as a
corporation under the laws of the State of Alabama;
(b) the transactions have been consummated in accordance with
such statement on Form U-1, as amended;
(c) all state laws applicable to the transactions have been
complied with;
(d) the Company's obligations with respect to the Revenue Bonds
are valid and binding obligations of the Company in
accordance with their terms; and
(e) the consummation of the transactions did not violate the
legal rights of the holders of any securities issued by the
Company or any associate company thereof.
We hereby give our written consent to the use of this opinion in
connection with the above-mentioned statement on Form U-1 and to
the filing thereof with the Commission at the time of the filing
of the certificate pursuant to Rule 24.
Very truly yours,
/s/Balch & Bingham
<PAGE>
