Exhibit 4.11
LOAN AGREEMENT
THERMOPLASTICS, INC.
AND
CITY OF MISHAWAKA, INDIANA
DATED AS OF SEPTEMBER 1, 1993
The rights of the City of Mishawaka, Indiana, under this Agreement (except
the right to receive payment for its expenses, the right to receive
indemnities, and rights relating to any amendments to this Agreement) have
been assigned to INB National Bank, as Trustee, under a Mortgage and Trust
Indenture dated as of the date of this Agreement among Thermoplastics,
Inc., the Municipality, and the Trustee.
TABLE OF CONTENTS
Section Page
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I
Definitions and Exhibits
Section 1.1. Terms Defined . . . . . . . . . . . . . . . . . . . . 2
Section 1.2. Rules of Interpretation . . . . . . . . . . . . . . . 3
Section 1.3. Exhibits. . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE II
The Loan and The Project
Section 2.1. Municipality's Representations, Warranties, and
Covenants . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.2. Company's Representations, Warranties, and Covenants. 5
Section 2.3. The Project . . . . . . . . . . . . . . . . . . . . . 7
Section 2.4. Mortgage and Title Insurance. . . . . . . . . . . . . 7
Section 2.5. Granting of Easements . . . . . . . . . . . . . . . . 8
Section 2.6. Release of Liens. . . . . . . . . . . . . . . . . . . 8
ARTICLE III
The Bonds, Use of Proceeds, The Note
Section 3.1. Agreement to Issue Bonds. . . . . . . . . . . . . . . 10
Section 3.2. Disbursements From Redemption Fund. . . . . . . . . . 10
Section 3.3. Company is Required to Pay in the Event Redemption Fund
is Insufficient . . . . . . . . . . . . . . . . . . . 10
Section 3.4. Investment of Redemption Fund and Bond Fund Moneys. . 10
Section 3.5. Covenants With Respect to Arbitrage . . . . . . . . . 10
Section 3.6. Loan Payments and Other Amounts Payable . . . . . . . 11
Section 3.7. Obligation of Company Unconditional . . . . . . . . . 12
ARTICLE IV
Particular Covenants of the Company
Section 4.1. Consent to Assignment to Trustee. . . . . . . . . . . 14
Section 4.2. Payment of Expenses of Issuance of Bonds. . . . . . . 14
Section 4.3. Company to Maintain its Existence; Conditions Under
Which Exceptions Permitted. . . . . . . . . . . . . . 14
Section 4.4. Further Assurances and Corrective Instruments . . . . 14
Section 4.5. Covenants of Company With Respect to Use of Bond
Proceeds. . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.6. Indemnification of Municipality and Trustee . . . . . 15
Section 4.7. Right of Access to Project. . . . . . . . . . . . . . 15
Section 4.8. Insurance . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.9. Taxes and Liabilities . . . . . . . . . . . . . . . . 15
ARTICLE V
Maintenance, Taxes, and Insurance
Section 5.1. Maintenance and Modifications of Project by Company . 16
Section 5.2. Taxes, Other Governmental Charges, and Utility Charges 16
Section 5.3. Insurance Required. . . . . . . . . . . . . . . . . . 17
Section 5.4. Application of Net Proceeds of Insurance. . . . . . . 17
Section 5.5. Additional Provision Respecting Insurance . . . . . . 17
Section 5.6. Advances by Trustee . . . . . . . . . . . . . . . . . 18
ARTICLE VI
Damage, Destruction, and Condemnation
Section 6.1. Damage and Destruction. . . . . . . . . . . . . . . . 19
Section 6.2. Condemnation. . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VII
Prepayment of Note
Section 7.1. Optional Prepayment of Note . . . . . . . . . . . . . 21
Section 7.2. Mandatory Prepayment of Note. . . . . . . . . . . . . 21
Section 7.3. Extraordinary Event Prepayment of the Note. . . . . . 21
Section 7.4. Notice of Prepayment. . . . . . . . . . . . . . . . . 21
ARTICLE VIII
Events of Default and Remedies
Section 8.1. Events of Default . . . . . . . . . . . . . . . . . . 22
Section 8.2. Remedies on Default . . . . . . . . . . . . . . . . . 23
Section 8.3. Application of Moneys . . . . . . . . . . . . . . . . 23
Section 8.4. Remedies Cumulative . . . . . . . . . . . . . . . . . 23
Section 8.5. Delay or Omission Not a Waiver. . . . . . . . . . . . 23
Section 8.6. Remedies Subject to Provisions of Law . . . . . . . . 24
ARTICLE IX
Supplements and Amendments to This Agreement
Section 9.1. Supplements and Amendments to This Agreement. . . . . 25
ARTICLE X
Miscellaneous
Section 10.1. Binding Effect. . . . . . . . . . . . . . . . . 26
Section 10.2. Severability. . . . . . . . . . . . . . . . . . 26
Section 10.3. Amounts Remaining in Bond Fund. . . . . . . . . 26
Section 10.4. Amendments, Changes, and Modifications. . . . . 26
Section 10.5. Execution in Counterparts . . . . . . . . . . . 26
Section 10.6. Notices . . . . . . . . . . . . . . . . . . . . 26
Section 10.7. References to Bonds Ineffective After Bonds Are
Paid. . . . . . . . . . . . . . . . . . . . . . 26
Section 10.8. Agreement for Benefit of Parties Hereto . . . . 26
Section 10.9. Waiver. . . . . . . . . . . . . . . . . . . . . 26
Section 10.10. Captions and Table of Contents. . . . . . . . . 27
Section 10.11. Survival of Covenants, Representations, and
Warranties. . . . . . . . . . . . . . . . . . . 27
Section 10.12. Applicable Law. . . . . . . . . . . . . . . . . 27
Section 10.13. Holidays. . . . . . . . . . . . . . . . . . . . 27
EXHIBIT A--Description of the Project and Project Site
EXHIBIT B--Form of Promissory Note
LOAN AGREEMENT
This LOAN AGREEMENT has been executed as of September 1, 1993, by
and between THERMOPLASTICS, INC., an Indiana corporation (the "Company"),
and the CITY OF MISHAWAKA, INDIANA (the "Municipality").
RECITALS
1. Definitions of certain of the terms used in these Recitals
are set out in Article I hereof and Article I of the Indenture (as defined
in Article I hereof).
2. The Municipality previously issued its $3,500,000 principal
amount of City of Mishawaka, Indiana, Economic Development Mortgage
Revenue Bonds, Series 1988 (Elco Industries, Inc./Thermoplastics, Inc.
Project) (the "1988 Bonds"), the proceeds of which were used to assist the
Company with the acquisition, construction, installation, and equipping of
the Project which is located on the Project Site in the Municipality.
3. The Company has determined that it can achieve a
significant cost savings through the refunding and refinancing of the 1988
Bonds. To assist the Company in achieving and effecting such savings, the
Municipality, pursuant to IC 5-1-5, IC 36-7-11.9, and IC 36-7-12, will
issue $3,500,000 aggregate principal amount of City of Mishawaka, Indiana,
Economic Development Refunding Revenue Bonds, Series 1993 (Elco
Industries, Inc./Thermoplastics, Inc. Project) (the "Bonds"), and will
loan the proceeds thereof to the Company, which will use such proceeds for
the purpose of retiring and redeeming the 1988 Bonds, all as described
herein and in the Indenture.
4. As evidence of its obligation to repay the funds loaned to
it under this Loan Agreement, the Company is issuing to the Municipality
its Note.
5. Pursuant to a Mortgage and Trust Indenture dated as of the
date of this Agreement, among the Company, the Municipality, and INB
National Bank, as Trustee, the Municipality will issue the Bonds and, as
security for the payment of the Bonds and the performance of the
obligations of the Municipality and the Company under the Indenture and
the Note, the Municipality will assign the Note and its rights under this
Agreement (except the right to receive payment for its expenses, the right
to receive indemnities and rights relating to any amendments to this
Agreement) to the Trustee and the Company will grant to the Trustee a
mortgage on the Project Site. In addition, the principal of, premium, if
any, and interest on the Bonds will be guaranteed by Elco Industries,
Inc., a Delaware corporation, pursuant to a Guaranty Agreement dated as of
September 1, 1993. The Bonds will be payable solely out of the revenues
and other amounts derived from the Note and under this Agreement and shall
not in any respect be a general obligation of, an indebtedness of, or
constitute a charge against the general credit of the Municipality, the
State of Indiana, or any political subdivision thereof.
AGREEMENT
In consideration of the premises and the mutual covenants
contained herein, the Company and the Municipality agree as follows:
ARTICLE I
Definitions and Exhibits
Section 1.1. Terms Defined. As used in this Agreement, the
following terms shall have the following meanings unless the context
otherwise requires:
"Act" means IC 5-1-5, IC 36-7-11.9, and IC 36-7-12, as from time
to time amended.
"Agreement" means this Loan Agreement and any amendment and
supplement thereto.
"Agreement Term" means the period commencing on the date of this
Agreement and, subject to the provisions of this Agreement, ending on such
date as the Bonds have been fully paid and retired or provision for such
payment made as provided in the Indenture.
"Authorized Company Representative" means a person designated to
act on behalf of the Company by written certificate furnished to the
Municipality and the Trustee containing the specimen signature of the
person and signed on behalf of the Company by its President, any of its
Vice-Presidents, its Chief Financial Officer, its Secretary, or any of its
Assistant Secretaries. The certificate may designate an alternate or
alternates. The Authorized Company Representative may be an employee of
the Company.
"Bonds" means the $3,500,000 aggregate principal amount of the
City of Mishawaka, Indiana, Economic Development Refunding Revenue Bonds,
Series 1993 (Elco Industries, Inc./Thermoplastics, Inc. Project).
"Bond Fund" means the fund created in Section 402 of the
Indenture.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means Thermoplastics, Inc., an Indiana corporation, and
its successors and assigns.
"Counsel" means an attorney-at-law (who may be counsel to the
Trustee, the Municipality, or the Company).
"Guarantor" means Elco Industries, Inc., a Delaware corporation.
"Guaranty" means the Guaranty Agreement dated as of September 1,
1993, executed by the Guarantor under which the Guarantor guarantees the
payment of principal of, premium, if any, and interest on the Bonds.
"Indenture" means the Mortgage and Trust Indenture, dated as of
the date of this Agreement, among the Company, the Municipality, and the
Trustee, relating to the Bonds, and any indenture supplemental thereto.
"Loan" means the $3,500,000 loan by the Municipality to the
Company of the proceeds of the Bonds.
"Municipality" means the City of Mishawaka, Indiana, and any
successor.
"Net Proceeds" means, when used with respect to any insurance
proceeds or any condemnation award, the amount remaining after deducting
all expenses (including attorneys' fees) incurred in the collection of
such proceeds or award from the gross proceeds thereof.
"1988 Bonds" means the City of Mishawaka, Indiana, Economic
Development Mortgage Revenue Bonds, Series 1988 (Elco Industries, Inc./
Thermoplastics, Inc. Project).
"Note" means the Note of the Company in substantially the form of
Exhibit B hereto and any Note issued in exchange therefor.
"Project" means the facilities described in Part I of Exhibit A
hereto.
"Project Cost" means and includes all those costs related to the
Project which are permitted to be financed under the Code, the Act, this
Agreement, and the Indenture and which do not result in a loss of the
exclusion from gross income for federal income tax purposes of the
interest on the Bonds under the Code.
"Project Site" means the real estate described in Part II of
Exhibit A hereto on which the Project is located.
"Purchaser" means Robert W. Baird & Co. Incorporated.
"Redemption Fund" means the fund created in Section 302 of the
Indenture.
"Trustee" means INB National Bank, and any successor trustee or
co-trustee serving under the Indenture.
Section 1.2. Rules of Interpretation. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:
(a) "This Agreement" means this instrument as originally
executed and as it may from time to time be supplemented or amended.
(b) The words "herein," "hereof," and "hereunder," and other
words of similar import, refer to this Agreement as a whole and not
to any particular Article, Section, or other subdivision.
(c) The terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as
the singular.
(d) All accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with generally accepted
accounting principles.
(e) Any terms not defined herein but defined in the
Indenture shall have the same meaning herein.
(f) The terms defined elsewhere in this Agreement shall have
the meanings therein prescribed for them.
Section 1.3. Exhibits. The following Exhibits are a part of
this Agreement:
Exhibit A: Description of the Project (Part I) and the
Project Site (Part II)
Exhibit B: Form of Note, form of Note Registrar's
Certificate of Validation, and form of Assignment
ARTICLE II
The Loan and The Project
Section 2.1. Municipality's Representations, Warranties, and
Covenants.
(a) The Municipality represents and warrants that:
(i) The Municipality is a duly organized and existing
municipal corporation and political subdivision of the State of
Indiana, with full power and authority under the Act to enter into
the transactions contemplated by this Agreement and to carry out its
obligations hereunder.
(ii) The Municipality has duly authorized the issuance,
execution, and delivery of the Bonds and the execution and delivery
of this Agreement.
(b) The Municipality covenants that:
(i) The Municipality shall not take any action to interfere
with any obligation it may have with respect to the Bonds, the
proceedings authorizing the Bonds or this Agreement.
(ii) The Municipality shall provide funds from the proceeds
from the sale of the Bonds for the redemption and retirement of the
1988 Bonds, and shall secure the payment of the Bonds by assigning
this Agreement (except the right to receive payment for its
expenses, the right to receive indemnities, and rights relating to
any amendment of this Agreement) and the Note to the Trustee
pursuant to the Indenture.
Section 2.2. Company's Representations, Warranties, and
Covenants. The Company makes the following representations and warranties
(all as of the date on which this Agreement has been executed) and in
addition, makes the following covenants:
(a) It is a duly organized and validly existing corporation
in good standing under the laws of the State of Indiana, has the
power and authority to own its properties and assets and to carry on
its business as now being conducted and as now contemplated, and has
full power and authority to issue the Note and to execute and
deliver this Agreement and the Indenture; all actions necessary for
the execution and delivery of the Note, this Agreement, and the
Indenture have been taken; and the Note will be a valid and binding
obligation of the Company.
(b) The execution, delivery, and performance of this
Agreement, the Note, and the Indenture will not conflict with or
result in a breach of, or a default under, the Company's Articles of
Incorporation, By-Laws, or any material agreement or instrument to
which the Company is a party or by which it is bound (excepting,
however, such agreements or instruments with respect to which the
Company has been required to and has obtained waivers or consents)
or result in the creation or imposition of any lien, charge or
encumbrance upon any of the property or assets of the Company,
except for the lien of the Indenture.
(c) The 1988 Bonds were, to the best knowledge and belief of
the Company, exempt from federal and State of Indiana income
taxation when issued, as described in and subject to the limitations
contained in the offering circular for the 1988 Bonds, the Company
has no knowledge of any event occurring since the date of issuance
of the 1988 Bonds that adversely affects that tax exempt status of
the 1988 Bonds and the Company has received no notification of any
such event from the Municipality, the trustee for the 1988 Bonds, a
holder of a 1988 Bond, the Internal Revenue Service or the State of
Indiana.
(d) The "average maturity" of the Bonds (taking into account
their issue prices) does not exceed 120% of the remaining "average
reasonably expected economic life" of the facilities originally
financed with the proceeds of the 1988 Bonds (taking into account
the respective cost of such facilities), all as determined in
accordance with the provisions of Section 147(b) of the Code.
(e) No portion of the proceeds of the Bonds will be used to
provide any facility the primary purpose of which is retail food and
beverage service, automobile sales or services, or the provision of
recreation or entertainment, any private or commercial golf course,
country club, massage parlor, tennis club, skating facility
(including roller skating, skateboard, and ice skating), racquet
sports facility (including any handball or racquetball court), hot
tub facility, suntan facility, racetrack, airplane, sky box or other
private luxury box, health club facility, facility used for
gambling, or facility used for the sale of alcoholic beverages.
(f) The Bonds are not and shall not be "federally
guaranteed" as defined in Section 149(b) of the Code.
(g) The proceeds of the Bonds that will be used to acquire
land (or any interest therein) will not exceed 24.9% of the net
proceeds of the Bonds. No portion of the proceeds other than those
used to acquire land (or an interest therein) will be used to
acquire any property (or an interest therein) where the first use of
such property is not pursuant to such acquisition.
(h) The aggregate authorized face amount of the Bonds
allocated to any "test period beneficiary," as such term is defined
in Section 144 of the Code, when increased by the outstanding tax-
exempt industrial development bonds of such beneficiary, does not
and shall not exceed $40,000,000.
(i) The Company represents and warrants that it is the
lawful owner of the Mortgaged Property, free and clear of all liens,
security interests, charges, or encumbrances whatever except
Permitted Encumbrances, and that the Company has full power and
lawful authority to mortgage the Mortgaged Property and the real
property improvements thereon to the Trustee; and that the Company
has good and marketable title to the Mortgaged Property except
Permitted Encumbrances and will preserve, warrant, and defend the
same unto the Trustee against the claims of all persons and parties.
(j) The execution, delivery, and performance by the Company
of this Loan Agreement and the Note do not require the consent or
approval of, the giving of notice of, the registration with, or the
taking of any other action in respect of, any federal, state or
other governmental authority or agency, not previously obtained or
performed.
(k) No litigation, environmental investigations, arbitration
proceedings, or governmental proceedings are pending or threatened
against the Company which would, if adversely determined, materially
and adversely affect the financial condition or continued operations
or properties of the Company and which the Company believes, after
consulting with its counsel, are reasonably likely to be adversely
determined.
(l) The Company will take no action which would (and will
omit no action reasonably within its power, the omission of which
would) cause the interest on the Bonds to become includable for
Federal income tax purposes in the gross income of any Bondholder,
other than a Bondholder who is a "substantial user" of the Project
or a "related person" within the meaning and for the purpose of
Section 147 of the Code.
Section 2.3. The Project. The Company shall cause the Project
to continue to be used, throughout the term of this Agreement as an
"economic development facility" within the meaning of the Act. The
failure or inability of the Company to use the Project, or to cause it to
be used, for the intended purposes shall not affect in any way the
Company's obligations under this Agreement or the Note and shall not be
deemed a breach or default under this Agreement as long as the use does
not affect the validity of the Bonds or result in the interest on the
Bonds becoming includable for federal income tax purposes in the gross
income of a Bondholder.
Section 2.4. Mortgage and Title Insurance. As security for the
payment of the Bonds and the performance of its obligations under the
Indenture and the Note, the Company shall mortgage the Mortgaged Property.
The Company shall provide an ALTA mortgagee's policy of title insurance
issued by a title insurance company reasonably satisfactory to the Trustee
in an amount not less than $3,500,000, which policy shall be free and
clear of all exceptions except Permitted Encumbrances. Any Net Proceeds
payable under such policy shall, at the Trustee's option, be either
(a) used to acquire and construct replacement or substitute property for
that to which title has been lost and such property shall be subject to
the lien of the Indenture, or (b) used to redeem the Bonds or portions
thereof on the earliest possible redemption date.
Section 2.5. Granting of Easements. If no Event of Default
shall have happened and be continuing, the Company may at any time or
times, grant easements, licenses, rights-of-way (including the dedication
of public highways), and other rights or privileges in the nature of the
easements with respect to any property subject to the lien of the
Indenture, free from the lien of the Indenture, or release existing
easements, licenses, rights-of-way, and other rights or privileges, with
or without consideration, and the Municipality and the Trustee shall
execute and deliver any instrument necessary or appropriate to confirm and
grant or release any such easement, license, right-of-way, or other right
or privilege upon receipt of: (a) a copy of the instrument of grant or
release, (b) a written application signed by the Authorized Company
Representative requesting such instrument, (c) a certificate executed by
the Authorized Company Representative stating (i) that such grant or
release is not detrimental to the proper conduct of the business of the
Company, and (ii) that such grant or release will not impair the effective
use or interfere with the operation of the Mortgaged Property and will not
materially weaken, diminish or impair the security intended to be given by
or under the Indenture accompanied by a Certificate of an independent
architect or other expert reasonably acceptable to the Trustee to the
effect that such grant or release will not materially and adversely affect
the operability of the Mortgaged Property.
Section 2.6. Release of Liens. The Trustee shall, at the joint
written request of the Company and the Holders of a majority in aggregate
principal amount of the Bonds then outstanding (and without the necessity
of obtaining the consent of the Municipality), release any item of
collateral specified or referred to in the First or Second Granting Clause
of the Indenture from the lien of the Indenture. The Municipality and the
Trustee shall execute and deliver any instrument necessary or appropriate
to confirm and grant any such disposition or release.
In addition to the foregoing, the Trustee shall, without the
necessity for obtaining the consent of the Municipality or the
Bondholders, release from the lien of the Indenture the Mortgaged Property
or any portion thereof at any time and from time to time provided that the
Company first furnishes the Trustee with, in the event that a portion of
the Mortgaged Property is to be released, the items set forth in
paragraphs 1 and 2 below and, in the event that the entire Mortgaged
Property is to be released, the items set forth in paragraphs (1)(iii)
and (2) below:
(1) A certificate of the Company containing or stating, as
the case may be (i) an adequate legal description of the portion of
the Mortgaged Property to be released, (ii) an "as-built" survey of
the portion of the Mortgaged Property to be released, (iii) that the
Company intends to exercise its privilege of having such Mortgaged
Property released, (iv) that the portion of the Mortgaged Property
with respect to which the release is requested is not needed to
operate the Project, or that the Company has reserved sufficient
right, title, and interest to fulfill such needs, and (v) that the
release will not materially impair ingress and egress to and from or
the operating unity of the Mortgaged Property; and
(2) Either: (i) cash equal to the current fair market value
of the Mortgaged Property or portion thereof to be released (which
value shall be determined by an independent appraisal), which cash
shall be deposited in the Bond Fund under the Indenture and used for
the purposes for which the Bond Fund exists as set forth in the
Indenture including, to the extent possible, the redemption of Bonds
prior to maturity, or (ii) a first mortgage lien in favor of the
Trustee (which lien may be subject to Permitted Encumbrances) on
real property owned and used in the operations of the Company or the
Guarantor the value of which property (determined as of the date on
which such property becomes subject to the mortgage lien described
herein (the "Substitution Date")) is, in the reasonable opinion of
the Trustee, who may rely on the opinion of an expert independent
appraiser selected by the Trustee, at least equal in value to the
value (determined as of the Substitution Date) of the Mortgaged
Property or portion thereof to be released. If the Company
determines to provide the Trustee the mortgage lien described
herein, the mortgage instrument shall be in a form reasonably
acceptable to the Trustee and shall be accompanied by (i) a policy
of title insurance in the full amount of the value of the property
to be subject to the mortgage lien described herein, issued by a
title insurance company that is both authorized to do business in
Indiana and in all other respects reasonably acceptable to the
Trustee, and providing coverage substantially similar to the
coverage provided by the policy of title insurance issued with
respect to the Mortgaged Property, and (ii) an opinion of counsel as
to the validity and enforceability of the mortgage.
ARTICLE III
The Bonds, Use of Proceeds, The Note
Section 3.1. Agreement to Issue Bonds. In order to provide
funds to make the Loan, the Municipality shall issue the Bonds and sell
them to the Purchaser and deposit the proceeds with the Trustee as
follows:
(a) Into the Bond Fund, the accrued interest, if any, paid
by the Purchaser; and
(b) Into the Redemption Fund, the balance of the proceeds.
Section 3.2. Disbursements From Redemption Fund. The Indenture
authorizes the Trustee to make payments from the Redemption Fund to INB
National Bank (f/k/a The Indiana National Bank) in its capacity as trustee
with respect to the 1988 Bonds and solely for the purpose of discharging,
redeeming and retiring the 1988 Bonds, provided, however, that any moneys
remaining in the Redemption Fund after such discharge, retirement,
redemption, and termination shall be promptly deposited in the Bond Fund.
Payment as aforesaid shall be made upon receipt by the Trustee of all
materials and documents necessary to evidence to the satisfaction of the
Trustee that the funds being disbursed hereunder are sufficient to
discharge fully all obligations of the Company created and existing in
connection with the 1988 Bonds, together with all instruments and
documents necessary to evidence to the satisfaction of the Trustee the
discharge of all liens and encumbrances arising and existing by reason of
the 1988 Bonds.
Section 3.3. Company is Required to Pay in the Event Redemption
Fund is Insufficient. In the event the moneys in the Redemption Fund
should not be sufficient to pay the costs of retiring, redeeming, and
discharging the 1988 Bonds in full, the Company shall pay that portion of
the costs in excess of the moneys available in the Redemption Fund.
Section 3.4. Investment of Redemption Fund and Bond Fund Moneys.
Any moneys held as part of the Redemption Fund and the Bond Fund shall be
invested by the Trustee at the direction of the Company in Qualified
Investments which shall be direct obligations of the United States of
America or in other obligations backed by the full faith and credit of the
United States of America.
Section 3.5. Covenants With Respect to Arbitrage. The Company
and the Municipality covenant to each other and to and for the benefit of
the holders of the Bonds that no use will be made of the proceeds from the
issue and sale of the Bonds which, if such use could have been reasonably
expected on the date of issue of the Bonds, would have caused the Bonds to
be classified as arbitrage bonds under Section 103(b)(2) of the Code
(within the meaning of Section 148 of the Code). As long as any Bonds are
outstanding, the Municipality and the Company shall not violate the
requirements of the Code relating to arbitrage bonds, and any regulations
thereunder, including the requirement of Section 148 of the Code relating
to the rebate of certain amounts to the United States government. The
Company will provide to the Trustee instructions relating to the
permissible investment of Bond proceeds and instructions and computations
(using investment information provided by the Trustee) relating to the
amount required to be rebated to the United States, all in conformity with
Section 148 of the Code. The Company reserves the right, however, to make
any investment of proceeds permitted under the laws of the State of
Indiana, if the sections of the Code relating to arbitrage bonds or the
regulations thereunder are repealed or relaxed or are held void by final
judgment of a court of competent jurisdiction, so long as the investment
would not result in making the interest on the Bonds includable in the
gross income of the holders thereof for purposes of Federal income
taxation. In making investments, the Company may rely on an opinion of
counsel of recognized competence in such matters. The Trustee may make
any and all such investments through its own bond department.
Section 3.6. Loan Payments and Other Amounts Payable.
(a) Concurrently with the sale of the Bonds, the Company shall
execute and deliver the Note to the Municipality, pursuant to which the
Company shall make payments sufficient to pay when due (whether at
maturity, upon call for redemption, by acceleration or otherwise) the
principal of, premium, if any, and interest on the Bonds. The Note shall
be issued as a fully registered note substantially in the form attached
hereto as Exhibit B. The Trustee shall act as Note Registrar and shall
cause books for the registration and for the transfer of the Note to be
kept at its principal office. Upon surrender for transfer of the Note at
the principal office of the Trustee, endorsed for transfer by the
registered owner or accompanied by an assignment executed by the
registered owner or his authorized attorney, the Trustee shall validate
and deliver in the name of the transferee a new Note which shall have been
executed by the Company. The person in whose name the Note is registered
shall be deemed the absolute owner thereof for all purposes, and
references to the holder of the Note shall mean the registered owner
thereof.
(b) The Company shall also pay when due (i) the reasonable and
necessary fees and expenses of the Trustee (including any reasonable and
necessary fees and expenses in its capacity as Note Registrar) and any
paying agent for services in connection with the Bonds as specified in
Section 903 of the Indenture, and (ii) the reasonable and necessary fees
and expenses of the Municipality, including reasonable attorneys' fees, in
connection with any default of the Company under this Agreement, the Note
or the Indenture.
(c) If the Company fails to make any of the payments required
in this Section 3.6 or in the Note, all unpaid items or installments shall
continue as an obligation of the Company until fully paid, and the Company
shall pay the same with interest thereon (to the extent permitted by law)
until paid at a per annum rate of interest equal to the per annum rate
then in effect on the Bonds plus two percent (2%), or at the maximum rate
permitted by law, whichever is lesser.
(d) All payments under this Section 3.6 shall be made by the
Company directly to the Trustee in immediately available funds and the
Trustee shall deposit all such payments into the Bond Fund provided that
payments under Section 3.6(b) shall be made by the Company directly to the
person entitled thereto. The amount of any money in the Bond Fund which
is either proceeds from the sale of any Bonds or earnings on investments
made pursuant to the provisions of the Indenture which has been set aside
by the Trustee, at the request of the Company, for payments of principal,
whether at maturity or upon redemption, of the Bonds shall be credited
against the obligation of the Company to pay the principal of the Note.
The amount of any money in the Bond Fund which is either proceeds from the
sale of any Bonds or earnings on investments made pursuant to the
provisions of the Indenture which has been set aside by the Trustee for
payments of interest on the Bonds shall be credited against the obligation
of the Company to pay interest on the Note. The principal amount of any
Bonds purchased by the Company and delivered to the Trustee, or purchased
by the Trustee and cancelled, shall be credited against the obligation of
the Company to pay the principal of the Note.
(e) If on any principal or interest payment date the balance in
the Bond Fund is insufficient to make the required payments of principal
of and premium, if any, and interest on the Bonds on that date, the
Company upon notice shall pay forthwith any deficiency to the Trustee.
(f) The Company shall not be obligated to make any further
payments under this Section 3.6, and the Company's liability to make
payments under this Section 3.6 shall cease, at any time that the entire
principal of and premium, if any, and interest on the Bonds shall have
been fully paid in accordance with their terms and the provisions of
Section 1201 of the Indenture (including, without limitation, principal,
interest to maturity or earliest redemption date, as the case may be,
expenses of redemption, redemption premiums, and fees and expenses of the
Municipality, the Trustee and any paying agent and any other costs and
fees required to be paid by the Company pursuant to this Agreement), or at
any time that there shall be in the Bond Fund an amount sufficient to pay
or redeem the Bonds in accordance with the provisions of Section 1201 the
Indenture (including, without limitation, principal, interest to maturity
or earliest redemption date, as the case may be, expenses of redemption
and redemption premiums, and fees and expenses of the Municipality, the
Trustee and any paying agent and any other costs and fees required to be
paid by the Company pursuant to this Agreement) and all other requirements
of Section 1201 of the Indenture have been satisfied in full.
Section 3.7. Obligation of Company Unconditional. The
obligation of the Company to make the payments and to perform and observe
its other agreements pursuant to this Agreement and the Note shall be
absolute and unconditional and shall not be subject to reduction or delay
by set-off, counterclaim, abatement or otherwise. Until such time as the
principal of and premium, if any, and interest on the Bonds shall have
been fully paid or provision for the payment thereof shall have been made
in accordance with Section 1201 of the Indenture (including, without
limitation, principal, interest to maturity or earliest redemption date,
as the case may be, expenses of redemption, redemption premiums, and fees
and expenses of the Municipality, the Trustee and any paying agent and any
other costs and fees required to be paid by the Company pursuant to this
Agreement), and all other requirements of Section 1201 of the Indenture
have been satisfied in full, the Company (a) shall not suspend or
discontinue any payments pursuant to this Agreement or the Note, (b) shall
perform and observe all its other agreements contained in this Agreement
and the Note, and (c) except as provided in Article VII hereof, shall not
terminate this Agreement or the Note for any cause. Nothing contained in
this Agreement shall be construed to release the Municipality from the
performance of any of its obligations; and in the event the Municipality
shall fail to perform any such agreement on its part, the Company may
institute such action against the Municipality as the Company may deem
necessary to compel performance, provided that no such action shall
(i) violate the agreements on the part of the Company contained in the
first sentence of this Section 3.7 or (ii) diminish the amounts required
to be paid by the Company pursuant to Section 3.6 hereof.
ARTICLE IV
Particular Covenants of the Company
Section 4.1. Consent to Assignment to Trustee. The Company
acknowledges and consents to the assignment of the Note and of the
Municipality's rights hereunder (except the right to receive payment for
its expenses, the right to receive indemnities and rights relating to any
amendments to this Agreement) to the Trustee pursuant to the Indenture.
Except as otherwise provided herein, the Company shall pay to the Trustee
all amounts payable under this Agreement and the Note, and the Company
acknowledges that the Trustee may enforce the rights, remedies and
privileges granted to the Municipality hereunder.
Section 4.2. Payment of Expenses of Issuance of Bonds. In
addition to its payment obligations under Section 3.6 of this Agreement,
the Company shall pay for all the reasonable costs and shall be liable and
pay for any recording expenses, legal fees, printing expenses and other
fees and expenses reasonably incurred or to be incurred by or on behalf of
the Municipality and the Trustee in connection with or as an incident to
the issuance and sale of the Bonds or any amendment or supplement to this
Agreement or the Indenture.
Section 4.3. Company to Maintain its Existence; Conditions Under
Which Exceptions Permitted. The Company shall during the term of this
Agreement maintain its corporate existence and will be duly qualified to
transact business in the State of Indiana and shall not voluntarily take,
or omit to take, any action that would cause the Company to be dissolved,
nor shall the Company sell, lease transfer or otherwise dispose of all or
substantially all of its assets or consolidate with or merge into another
corporation or permit one or more other corporations to consolidate with
or merge into it; except that the Company may consolidate with or merge
into another corporation incorporated and existing under the laws of the
United States of America or one of the states of the United States of
America or permit one or more other corporations to consolidate with or
merge into it or sell or otherwise transfer to another such corporation
all or substantially all of its assets as an entirety and may thereafter
dissolve, provided, that immediately after such action there is no default
under the Note, this Agreement or the Indenture, and further provided that
if the Company is not the surviving, resulting or transferee corporation
(the "Survivor"), the Survivor is (a) qualified to do business in the
State of Indiana and (b) shall expressly assume and agree to perform all
of the Company's obligations under this Agreement, the Note and the
Indenture.
Section 4.4. Further Assurances and Corrective Instruments. The
Municipality and the Company shall execute and deliver, or cause to be
executed and delivered, such supplements hereto and further instruments as
may reasonably be required for carrying out the intention of or
facilitating the performance of this Agreement.
Section 4.5. Covenants of Company With Respect to Use of Bond
Proceeds. The Municipality is issuing the Bonds pursuant to an exemption
contained in the Code. It is the intention of the parties that the
interest on the Bonds remain excludable from gross income for purposes of
federal income taxation and to that end the Company covenants with the
Municipality and with the Trustee for the benefit of the future holders of
the Bonds, that it will never, insofar as it is able, permit Bond proceeds
to be expended or utilized in such a manner as to cause the loss of the
exclusion claimed other than as a result of previously unanticipated
capital expenditures.
Section 4.6. Indemnification of Municipality and Trustee. The
Company shall indemnify and hold the Municipality and the Trustee harmless
against any claim, loss, liability or expense incurred without negligence
or bad faith or willful misconduct on the part of the Municipality or the
Trustee arising out of or in connection with this Agreement, the Note, the
Indenture or the Project or Project Site, including reasonable attorneys'
fees and the costs and expense of defense against any such claim or
liability.
Section 4.7. Right of Access to Project. The Municipality, the
Trustee, and any of their duly authorized agents shall have the right at
all reasonable times during normal business hours after reasonable prior
notice, subject to the Company's safety and security requirements, to
enter upon the Project Site and to examine and inspect the Project without
interference or prejudice to the Company's operation. The Municipality
and its duly authorized agents shall have such right of access to the
Project as may be reasonably necessary for the proper maintenance of the
Project in the event of failure by the Company to perform its obligations
under Section 5.1 hereof.
The Municipality and the Trustee shall not disclose to any other
person any trade secrets or other information designated by the Company as
confidential and obtained by the Municipality or Trustee from the above
mentioned inspection and examination.
Section 4.8. Insurance. Subject to Article V of this Agreement,
the Company shall maintain such insurance as may be required by law and
such other insurance, to such extent and against such hazards and
liabilities, as is customarily maintained by companies similarly situated.
Section 4.9. Taxes and Liabilities. Subject to Article V of
this Agreement, the Company shall pay when due all taxes, assessments and
other liabilities including trade accounts, except such as are being
contested in good faith and by appropriate proceedings and for which
appropriate reserves have been established and, as to trade accounts,
subject to industry practices.
ARTICLE V
Maintenance, Taxes, and Insurance
Section 5.1. Maintenance and Modifications of Project by
Company. The Company shall, during the Agreement Term and at its own
expense (a) keep the Project and the Project Site in as reasonably safe
condition as its operations shall permit, and (b) keep the Project in good
repair and in good operating condition, making from time to time all
necessary repairs thereto (including external and structural repairs) and
renewals and replacements thereof. Subject to the provisions of this
Agreement and the Indenture, the Company may, also at its own expense,
make from time to time any additions, modifications or improvements to the
Project, including specifically additions and expansions to the Project,
as it may deem desirable for its business purposes that do not materially
adversely affect the structural integrity of the Project or substantially
reduce its value; provided, that all such additions, modifications and
improvements to the Project shall be located wholly within the boundary
lines of the Project Site or any other real property owned by the Company
and made subject to the mortgage created by the Indenture and that is
subject to no liens, restrictions or encumbrances of any kind excepting
Permitted Encumbrances.
The Company shall not permit any mechanic's lien, security
interest or other encumbrance to remain against the Project or the Project
Site for labor or materials furnished in connection with any additions,
modifications, improvements, repairs, renewals or replacements so made by
it; provided, that if the Company shall first notify the Trustee of its
intention so to do, the Company may in good faith contest any such
mechanic's or similar lien filed or established against the Project or the
Project Site and in such event may permit the items so contested to remain
undischarged and unsatisfied during the period of such contest and any
appeal therefrom unless the Municipality or the Trustee shall notify the
Company that, by non-payment of any such items, the lien of the Indenture
as to any part of the Project or the Project Site will be materially
endangered or the Project or the Project Site or any part thereof will be
subject to loss or forfeiture, in which event the Company shall promptly
pay and cause to be satisfied and discharged all such unpaid items or
shall promptly provide the Municipality and the Trustee with a bond or
other security, reasonably acceptable to the Trustee.
Section 5.2. Taxes, Other Governmental Charges, and Utility
Charges. The Company shall promptly pay, as the same become due, all
taxes and governmental charges of any kind whatsoever that may at any time
be lawfully assessed or levied against or with respect to the Project or
the Project Site, or any interest therein or any machinery, equipment or
other property installed or bought by the Company therein or thereon
(including, without limiting the generality of the foregoing, any taxes
levied upon or with respect to the revenues, income or profits of the
Company from the Project which if not paid, will become a lien on the
Project or the Project Site prior to or on a parity with the lien of the
Indenture and including all ad valorem taxes lawfully assessed upon the
Project or the Project Site), all utility and other charges incurred in
the operation, maintenance, use, occupancy and upkeep of the Project or
the Project Site and all assessments and charges lawfully made by any
governmental body for public improvements that may be secured by lien on
the Project or the Project Site.
The Company may, at its expense and in its own name and behalf,
in good faith contest by appropriate proceedings any such taxes,
assessments and other charges and, in the event of any such contest, may
permit the taxes, assessments or other charges so contested to remain
unpaid during the period of such contest and any appeal therefrom,
provided during such period enforcement of any such contested item shall
be effectively stayed and appropriate reserves shall be established.
Section 5.3. Insurance Required. The Company shall insure or
cause to be insured during the Agreement Term the Project and the Project
Site, against such risks as are customarily insured against by businesses
of like size and type, paying as the same become due all premiums in
respect thereto, including but not necessarily limited to:
(a) Insurance upon the repair or replacement basis if
available, and otherwise to the full insurable value of the Project
(with deductible provisions not to exceed $100,000 in any one
casualty), against loss or damage by fire, lightning, windstorm,
hail, explosion and similar risks and perils with uniform standard
extended coverage endorsement limited only as may be provided in the
standard form of extended coverage endorsement at the time in use in
Indiana.
(b) Boiler explosion insurance on any steam boilers,
pressure vessels and pressure piping in an amount not less than the
full replacement cost of the Project (with deductible provisions not
to exceed $100,000), provided that such insurance need not be taken
out unless and until steam boilers, pressure vessels and pressure
piping have been installed in the Project.
(c) Comprehensive general public liability insurance to the
extent of $1,000,000 per occurrence against liability for bodily
injury, including death resulting therefrom, and damage to property
including loss of use thereof occurring on or in any way related to
the Project or the Project Site or any part thereof.
(d) Worker's compensation and occupational disease coverage
as required by the laws of the State of Indiana.
Section 5.4. Application of Net Proceeds of Insurance. The Net
Proceeds of the insurance carried pursuant to the provisions of
Section 5.3(a) and (b) hereof shall be paid and applied as provided
in Section 6.1 hereof, and the Net Proceeds of insurance carried pursuant
to the provisions of Section 5.3(c) and (d) hereof shall be applied toward
extinguishment or satisfaction of the liability with respect to which such
insurance proceeds have been paid.
Section 5.5. Additional Provision Respecting Insurance. All
insurance required in Section 5.3 hereof shall be taken out and maintained
in generally recognized responsible insurance companies selected by the
Company and qualified to do business in the State of Indiana. All
policies evidencing such insurance shall provide for payment to the
Company and the Trustee, as their respective interest may appear, and
shall not be cancelled or modified without at least ten days' prior
written notice to the Trustee. The policies required by Section 5.3(a)
and 5.3(b) shall contain standard mortgagee clauses requiring that all Net
Proceeds of insurance resulting from any claim in excess of $250,000 for
loss or damage covered thereby be paid to the Trustee; provided, however,
that all claims, regardless of amount, may be adjusted by the Company with
the insurers, subject to approval of the Trustee to the extent that its
interests may appear as to any settlement of any claim in excess of
$250,000.
A certificate, or certificates, of the insurers that such
insurance is in force and effect, together with copies of the insurance
policies, shall be deposited promptly with the Trustee and, prior to the
expiration of any such policy, the Company shall furnish the Trustee with
evidence satisfactory to the Trustee that the policy has been renewed or
replaced, or is no longer required by this Agreement. The insurance
herein required may be contained in blanket policies now or hereafter
maintained by the Company.
Section 5.6. Advances by Trustee. In the event the Company
shall fail, as required herein, (a) to maintain the full insurance
coverage, (b) to keep the Project and the Project Site in a reasonably
safe condition as its operating condition will permit, (c) to keep the
Project in good repair and good operating condition, (d) to discharge any
mechanic's lien, security interest or other encumbrance, or (e) to pay all
taxes, other governmental charges and utility charges, the Trustee may
(but shall be under no obligation to) take out the required policies of
insurance and pay the premiums on the same, make the required repairs,
renewals and replacements, discharge the lien or other encumbrance or pay
all taxes, other governmental charges and utility charges; and all amounts
so advanced therefor by the Trustee shall become an additional obligation
of the Company to the Trustee, which amounts, together with interest
thereon (to the extent permitted by law) until paid until repaid at the
rate of one percent (1%) per annum over the prime rate (which prime rate
shall be the rate from time to time announced by the commercial banking
department of the Trustee or any of its affiliates to be its prime rate on
90-day commercial loans), or at the maximum rate permitted by law,
whichever is lesser, the Company shall pay.
ARTICLE VI
Damage, Destruction, and Condemnation
Section 6.1. Damage and Destruction. Unless the Company shall
have exercised its option to prepay the Note in full pursuant to the
provisions of Section 7.1 hereof, if prior to full payment of the Bonds
(or provision for payment thereof having been made in accordance with the
provisions of the Indenture) the Project is destroyed (in whole or in
part) or is damaged by fire or other casualty to such extent that the
claim for loss under the insurance policies required to be carried
pursuant to Section 5.3(a) and (b) hereof resulting from such destruction
or damage is not greater than $250,000, the Company (a) shall promptly
repair, rebuild or restore the property damaged or destroyed to
substantially the same condition as it existed prior to the event causing
such damage or destruction, with such changes, alterations and
modifications (including the substitution and addition of other property)
as may be desired by the Company and as will not impair operating unity or
productive capacity or the character of the Project, and (b) shall apply
for such purpose so much as may be necessary of any Net Proceeds of
insurance resulting from such claims for losses, as well as any additional
moneys of the Company necessary therefor. All Net Proceeds of insurance
resulting from such claims for losses not in excess of $250,000 shall be
paid to the Company.
Unless the Company shall have exercised its option to prepay the
Note in full pursuant to the provisions of Section 7.1 hereof, if prior to
full payment of the Bonds (or provision for payment thereof having been
made in accordance with the provisions of the Indenture) the Project is
destroyed (in whole or in part) or is damaged by fire or other casualty to
such extent that the claim for loss under the insurance policies required
to be carried pursuant to Section 5.3(a) and (b) hereof resulting from
such destruction or damage is in excess of $250,000, the Company shall
promptly give written notice thereof to the Trustee. All Net Proceeds of
insurance resulting from such claims for losses shall be paid to and held
by the Trustee in a separate trust account, whereupon (i) the Company
shall proceed promptly to repair, rebuild or restore the property damaged
or destroyed to substantially the same condition as it existed prior to
the event causing such damage or destruction, with such changes,
alterations and modifications (including the substitution and addition of
other property) as may be desired by the Company and as will not impair
operating unity or productive capacity or the character of the Project,
and (ii) the Trustee shall apply so much as may be necessary of the Net
Proceeds of such insurance to payment of the costs of such repair,
rebuilding or restoration, either on completion thereof or as the work
progresses as directed by the Company. In the event said Net Proceeds are
not sufficient to pay in full the costs of such repair, rebuilding or
restoration, the Company shall, nonetheless, complete the work thereof and
shall pay that portion of the costs thereof in excess of the amount of
said Net Proceeds. The Company shall not, by reason of the payment of such
excess costs (whether by direct payment thereof or advances to the Trustee
therefor), be entitled to any reimbursement from the Trustee, or the
holders or owners of the Bonds, or any abatement or diminution of the
amount payable under this Agreement. Any balance of such Net Proceeds
remaining after payment of all the costs of such repair, rebuilding or
restoration shall be deposited into the Bond Fund. If the Bonds have been
fully paid (or provision for payment thereof has been made in accordance
with the Indenture), any balance of such Net Proceeds shall be paid to the
Company.
Any moneys held by the Trustee in the separate trust account
under the provisions of the preceding paragraph shall, at the written
request of the Authorized Company Representative, be invested or
reinvested by the Trustee as provided in Section 3.4 hereof. The Company
shall forthwith pay to the Trustee the amount of any losses with respect
to principal on such investments.
Section 6.2. Condemnation. Unless the Company shall have
exercised its option to prepay the Note in full pursuant to the provisions
of Section 7.1 hereof, in the event that title to, or the temporary use
of, the Project or the Project Site or any part thereof shall be taken
under the exercise of the power of eminent domain by any governmental body
or by any person, firm or corporation acting under governmental authority,
the Company shall be obligated to continue to make payments on the Note
and all other payments specified herein. The Company and the Trustee
shall cause the Net Proceeds received by them or either of them from any
award made in such eminent domain proceedings to be paid to and held by
the Trustee in a separate trust account, and to be applied in one or more
of the following ways as shall be directed in writing by the Company:
(a) The prompt repair, restoration, relocation, modification
or improvement of the Project and the Project Site, to substantially
the same condition as existed prior to the exercise of said power of
eminent domain.
(b) Redemption of the Bonds pursuant to Section 7.1 hereof;
provided, that no part of any such condemnation award may be applied
for such redemption, unless the Company shall furnish to the Trustee
a certificate of the Authorized Company Representative stating
(i) that the property forming a part of the Project or the Project
Site that was taken by such condemnation proceedings is not
essential to the Company's use or occupancy of the Project or the
Project Site, or (ii) that the Project or the Project Site has been
repaired, restored, relocated, modified or improved to a condition
substantially equivalent to its condition prior to the taking by
such condemnation proceedings.
Unless the Company shall have exercised its option to prepay the
Note in full pursuant to the provisions of Section 7.1 hereof within
ninety days from the date of entry of a final order in any eminent domain
proceedings granting condemnation, the Company shall direct the Trustee in
writing as to which of the ways specified in this Section 6.2 the Company
elects to have the condemnation award applied. Any balance of the Net
Proceeds of the award in such eminent domain proceedings shall be paid
into the Bond Fund. If the Bonds have been fully paid (or provision for
payment thereof has been made in accordance with the provisions of the
Indenture), all Net Proceeds shall be paid to the Company.
Any moneys held by the Trustee under the provisions of this
Section 6.2 shall, at the written request of the Authorized Company
Representative, be invested or reinvested by the Trustee in accord with
Section 3.4 hereof. The Company shall forthwith pay to the Trustee the
amounts of any losses with respect to principal on such investments.
ARTICLE VII
Prepayment of Note
Section 7.1. Optional Prepayment of Note. The Company may, at
its option, prepay the Note in whole or in part on or after October 1,
1997, (and if in part, in whole multiples of $5,000), on any date by
paying to the Trustee a sum sufficient, together with other funds in the
Bond Fund and available for that purpose, to pay (a) the principal of,
premium (as specified in the Indenture) and interest on that portion of
the Bonds then outstanding to be redeemed, and (b) all reasonable and
necessary fees and expenses of the Trustee and any paying agent accrued
and to accrue through the redemption date.
Section 7.2. Mandatory Prepayment of Note. The Company shall
prepay the amounts due under this Agreement and the Note in whole prior to
the expiration of this Agreement and prior to the full payment (or
provision for full payment) of the Bonds on the earliest practicable date
(selected by the Trustee) within ninety (90) days following a
Determination of Taxability (as defined in the Indenture).
In the event of an obligation to prepay under this Section 7.2,
the Company shall pay to the Trustee a sum sufficient, together with other
funds deposited into the Bond Fund and available for the purpose, to pay
the principal, premium (as specified in the Indenture) and interest on the
principal of all the Bonds then outstanding and all reasonable and
necessary fees and expenses of the Trustee and any paying agent accrued
and to accrue through final payment of the Bonds.
Section 7.3. Extraordinary Event Prepayment of the Note. The
Company may, at its option, prepay the Note in whole but not in part,
without redemption premium, within one year following the occurrence of
any of the events specified in Section 502 of the Indenture by paying the
Trustee a sum sufficient, together with other funds in the Bond Fund and
available for that purpose, to pay (a) the principal of and interest upon
all of the Bonds then outstanding, and (b) all reasonable and necessary
fees and expenses of the Trustee and the paying agent accrued and to
accrue through the redemption date.
Section 7.4. Notice of Prepayment. To exercise prepayment under
Section 7.1 or 7.3 hereof, the Company shall give written notice to the
Trustee at least forty-five (45) days but not more than seventy-five
(75) days prior to a specified date of the prepayment. To prepay under
Section 7.2 hereof, the Company shall give written notice to the Trustee
within thirty (30) days after the event requiring the prepayment
specifying the date of the prepayment, which shall be not less than forty-
five (45) days nor more than ninety (90) days from the date the notice is
mailed. If the Company fails to give timely notice of a prepayment under
Section 7.2 hereof, the Trustee shall give written notice to the Company
specifying a date of prepayment not less than fifteen (15) days nor more
than sixty (60) days from the date that notice is mailed.
ARTICLE VIII
Events of Default and Remedies
Section 8.1. Events of Default. The occurrence and continuance
of any of the following events shall constitute an "Event of Default"
hereunder:
(a) Default in the due and punctual payment of any
installment of principal of (whether at stated maturity, upon
required prepayment, acceleration or otherwise) or any payment of
interest or redemption premium on the Note;
(b) The dissolution or liquidation of the Company unless
such dissolution or liquidation is permitted by this Agreement;
(c) 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 those referred to in Section 8.1(a)
or (b) for a period of thirty (30) days after written notice,
specifying the failure and requesting that it be remedied, given to
the Company by the Trustee, unless the Trustee agrees in writing to
an extension of the time prior to its expiration; provided, however,
that with respect to this clause (c), if such failure of performance
shall be such that it cannot be corrected within such period, it
shall not constitute an Event of Default if such failure of
performance, in the reasonable opinion of the Trustee, is
correctable without material adverse effect on the Bonds and if
corrective action is instituted by or on behalf of the Company
within such period and diligently pursued until such failure of
performance is corrected.
(d) A decree or order shall have been entered by a court of
competent jurisdiction constituting an order for relief under the
Bankruptcy Code or adjudging the Company insolvent or approving as
properly filed a petition seeking reorganization of the Company
under the Bankruptcy Code or any other federal or state law relating
to bankruptcy or insolvency or appointing a receiver or decreeing or
ordering the winding up or liquidation of the affairs of the Company
or the sequestration of a substantial part of the property of the
Company, and any such decree or order shall remain in force
undischarged and unstayed for a period of ninety days.
(e) The Company shall file a petition seeking relief under
the Bankruptcy Code or shall suffer the imposition of an order
thereunder or shall institute or consent to the institution of
bankruptcy or insolvency proceedings against it or shall file a
petition or answer or consent seeking reorganization or relief
(other than as a creditor) under the Bankruptcy Code or any other
federal or state law relating to bankruptcy or insolvency or shall
consent to the filing of any such petition or shall consent to the
appointment of a receiver or shall make an assignment for the
benefit of creditors or shall admit in writing its inability to pay
its debts generally as they become due or shall fail to pay its
debts generally as they become due, or action shall be taken by the
Company in furtherance of any of the aforesaid purposes.
(f) An Event of Default as defined in Section 801 of the
Indenture shall have occurred.
(g) An Event of Default as defined in Section 4.1 of the
Guaranty shall have occurred.
Section 8.2. Remedies on Default. Whenever any Event of Default
referred to in Section 8.1 shall have happened and be continuing, the
Trustee:
(a) May, and upon the written request of the owners of not
less than 25% of the aggregate principal amount of the Bonds then
outstanding shall, declare the Note and all amounts payable
thereunder, whether by acceleration of maturity or otherwise, to be
immediately due and payable.
(b) The Trustee may take whatever action may appear
necessary or desirable to collect the amounts due and to become due
under this Agreement and the Note, or to enforce performance and
observance of any obligation, agreement or covenant of the Company
under this Agreement and the Note.
Section 8.3. Application of Moneys. All moneys collected by the
Trustee under Section 8.2 hereof shall be applied as follows:
FIRST: To pay any sums required to be paid by the Company
pursuant to this Agreement, the Note, the Indenture or the Bonds
other than principal, premium, if any, and interest on the Note
or the Bonds.
SECOND: To pay the whole amount then due, owing and unpaid
upon the Note for principal, premium, if any, and interest in
accordance with Section 807 of the Indenture. Payment shall be
made upon presentation of the Note and the notation on the Note
of the payment, if partially paid, or the surrender and
cancellation of the Note, if fully paid.
THIRD: To pay the Company, its successors or assigns, upon
the written request of the Company or to whosoever may be
lawfully entitled to receive the same upon its written request,
or as any court of competent jurisdiction may direct.
Section 8.4. Remedies Cumulative. No remedy granted by this
Agreement is intended to be exclusive of any other remedy. All available
remedies shall be cumulative.
Section 8.5. Delay or Omission Not a Waiver. No delay or
omission of the Trustee to exercise any right or power accruing upon any
Event of Default shall impair the right or power, or shall be construed to
be a waiver of the Event of Default or an acquiescence therein. Every
power and remedy may be exercised as often as the Trustee deems expedient.
Section 8.6. Remedies Subject to Provisions of Law. All rights,
remedies and powers provided by this Article may be exercised only to the
extent that their exercise does not violate any applicable provision of
law. All the provisions of this Article are intended to be subject to all
applicable mandatory provisions of law which may be controlling and to be
limited to the extent necessary so that they will not render this
Agreement invalid or unenforceable under the provisions of any applicable
law.
ARTICLE IX
Supplements and Amendments to This Agreement
Section 9.1. Supplements and Amendments to This Agreement.
Reference is made to Article XI of the Indenture.
ARTICLE X
Miscellaneous
Section 10.1. Binding Effect. This Agreement shall inure to the
benefit of and shall be binding upon the Municipality, the Company and
their respective successors and assigns, subject to the limitations in
Sections 4.3 and 10.4 hereof.
Section 10.2. Severability. In the event any provision of this
Agreement shall be held invalid or unenforceable by any court of competent
jurisdiction, that holding shall not invalidate or render unenforceable
any other provisions hereof.
Section 10.3. Amounts Remaining in Bond Fund. Any amounts
remaining in the Bond Fund upon expiration or termination of this
Agreement in accordance with the Indenture shall belong to and be paid to
the Company by the Trustee.
Section 10.4. Amendments, Changes, and Modifications. After the
Bonds are issued and before they are paid in full (or provision for
payment in full is made), this Agreement may not be amended, assigned or
terminated without the written consent of the Trustee.
Section 10.5. Execution in Counterparts. This Agreement may be
executed in several counterparts, each of which shall be an original.
Section 10.6. Notices. All notices, certificates, payments or
other communications hereunder shall be sufficiently given and shall be
deemed given when delivered or mailed by registered or certified mail,
postage prepaid, or overnight express mail addressed as follows: if to
the Municipality, at the City Hall, 600 East Third Street, Mishawaka,
Indiana 46544, Attention of its City Clerk; if to the Company, at
1400 South Industrial Drive, Mishawaka, Indiana 46544, Attention of its
President; if to the Guarantor, at 1111 Samuelson Road, P.0. Box 7009,
Rockford, Illinois 61125, Attention of its Vice President-Finance with a
copy to the attention of its President; or to such other address as may
hereafter be furnished by notice.
Section 10.7. References to Bonds Ineffective After Bonds Are
Paid. Upon payment in full of the Bonds (or provision for payment thereof
having been made in accordance with the provisions of the Indenture) and
payment of all fees and charges of the Municipality, Trustee and any
paying agent, all references in this Agreement to the Bonds and the
Trustee shall be ineffective and neither the Trustee nor the holders of
the Bonds shall thereafter have any rights hereunder, except those that
shall have theretofore vested.
Section 10.8. Agreement for Benefit of Parties Hereto. Nothing
in this Agreement, express or implied, is Intended to give to any person
other than the parties hereto and the holder of the Note, any right,
remedy or claim under or by reason of this Agreement.
Section 10.9. Waiver. No waiver of any of the provisions of
this Agreement shall be effective and binding unless set forth in a
written notice and no waiver of one provision shall be deemed or shall
constitute a waiver of any other provision hereof (whether or not similar)
nor shall such waiver constitute a continuing waiver or a waiver of such
provision in any other instance.
Section 10.10. Captions and Table of Contents. The captions
herein and the Table of Contents are inserted only as a matter of
convenience and do not in any way define, limit, construe or describe the
scope or intent of this Agreement or any section thereof or in any other
way affect this Agreement.
Section 10.11. Survival of Covenants, Representations, and
Warranties. All covenants, representations and warranties made by the
Company and the Municipality contained herein or in any other document,
certificate or instrument delivered in connection with the sale of any of
the Bonds shall be continuing and shall survive delivery of the Bonds and
the other transactions contemplated by this Agreement and the Indenture.
Section 10.12. Applicable Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of Indiana.
Section 10.13. Holidays. Where a date of payment on the Note is
not a Business Day, then payment may be made on the first Business Day
thereafter.
IN WITNESS WHEREOF, the Municipality and the Company have caused
this Agreement to be executed all as of the date first above written.
CITY OF MISHAWAKA, INDIANA
By:____________________________________
(SEAL) Robert C. Beutter, Mayor
ATTEST:
_____________________________
Deborah S. Block, Clerk
THERMOPLASTICS, INC.
By:_________________________________
August F. DeLuca, Vice President
ATTEST:
____________________________________
Kenneth L. Heal, Secretary/Treasurer
EXHIBIT A
(Description of the Project)
Part I The Project
The Project is an approximately 13,000 square foot single story
building addition to an existing building of approximately 57,000 square
feet, which existing facility and addition are located on the Project Site
(as described in Part II) and various equipment and machinery, some of
which is housed in the facility and some of which is housed in other
facilities of the Company.
Part II The Project Site
The Project Site consists of a certain parcel of land located in
Mishawaka, St. Joseph County, Indiana and more particularly described as
follows:
PARCEL I: A parcel of land being a part of the North Half of the
Northeast Quarter of Section 22, Township 37 North, Range 3 East, City of
Mishawaka, Penn Township, St. Joseph County, Indiana and being more
particularly described as follows: Commencing at the Northwest corner of
said Northeast Quarter of Section 22; thence North 89 57'07" East, a
distance of 909.45 feet to a point; thence South 0 01'35" East, deed
bearing, (South 0 02'19" East, measured bearing) a distance of 835 feet to
an iron pipe and the place of beginning for this description; thence South
0 01'35" East, deed bearing, (South 0 02'19" East, measured bearing), a
distance of 487.40 feet to the South line of said Half Quarter Section;
thence South 89 53'08" East, along said South line, a distance of
14.05 feet to an iron pipe set in a fence line; thence North 0 11'26"
East, along said fence line and its Northerly projection, a distance of
487.40 feet to an iron pipe; thence North 89 53'08" West, a distance of
16.00 feet to the place of beginning.
PARCEL II: Part of the North Half of the Northeast Quarter of Section 22,
Township 37 North, Range 3 East, situated in Penn Township, St. Joseph
County, State of Indiana, and being more particularly described as
follows: Commencing at the Northwest corner of the Northeast Quarter of
said Section 22; thence North 89 57'7" East along the North line of the
Northeast Quarter of said Section 22 a distance of 660.45 feet to a point;
thence South 0 1'35" East a distance of 990.06 feet to a point, said point
being the true place of beginning of this description; thence continuing
South 0 1'35" East a distance of 331.81 feet to a point on the South line
of the North Half of the Northeast Quarter of said Section 22; thence
North 89 55'32" West along the South line of the North Half of the
Northeast Quarter of said Section 22 a distance of 330 feet to a point;
thence North 0 1'35" West a distance of 331.1 feet to a point; thence
North 89 57'7" East a distance of 330 feet to the place of beginning of
this description.
PARCEL III: Part of the North Half of the Northeast Quarter of
Section 22, Township 37 North, Range 3 East, situate in Penn Township,
St. Joseph County, State of Indiana, and being more particularly described
as follows: Commencing at the Northwest corner of the Northeast Quarter
of said Section 22; thence North 89 57'11" East a distance of 909.45 feet
to a point; thence South 0 1'35" East a distance of 835 feet to a point,
said point being the true place of beginning of this description; thence
continuing South 0 1'35" East a distance of 487.4 feet to a point; thence
South 89 57'7" West a distance of 249 feet to a point; thence North
0 1'35" West a distance of 487.4 feet to a point; thence North 89 57'7"
East a distance of 249 feet to the place of beginning of this description.
PARCEL IV: A parcel of land being a part of the Northeast Quarter of
Section 22, Township 37 North, Range 3 East, Penn Township, St. Joseph
County, Indiana and being more particularly described as follows:
Commencing at the North Quarter corner of said Section 22, thence North
89 58'40" East along the North line of said Section 22, a distance of
1188.71 feet; thence South 0 00'19" East, a distance of 835.67 feet to the
place of beginning; thence continuing South 0 00'19" East, a distance of
487.37 feet; thence North 89 53'08" West, a distance of 264.87 feet;
thence North 0 11'26" East, a distance of 487.40 feet; thence South
89 53'08" East, a distance of 263.20 feet to the place of beginning.
PARCEL V: A parcel of land being a part of the Northeast Quarter of
Section 22, Township 37 North, Range 3 East, Penn Township, St. Joseph
County, Indiana and being more particularly described as follows:
Commencing at the North Quarter corner of said Section 22; thence North
89 58'40" East, along the North line of said Section 22, a distance of
1188.71 feet; thence South 0 00'19" East, a distance of 835.67 feet to the
place of beginning for this description; thence South 89 53'09" East, a
distance of 268.13 feet; thence South 0 00'19" East, a distance of
487.37 feet; thence North 89 53'08" West, a distance of 268.13 feet;
thence North 0 00'19" West, a distance of 487.37 feet to the place of
beginning.
EXHIBIT B
(Form of Note)
Thermoplastics, INC.
PROMISSORY NOTE
FOR VALUE RECEIVED, Thermoplastics, Inc., (the "Company"), an
Indiana corporation, promises to pay to The City of Mishawaka, Indiana, or
registered assigns, on or before 2 o'clock p.m. (Mishawaka time) (a) on
the first day of each October commencing October 1, 1998, and continuing
through October 1, 2000, a sum which, together with other moneys available
therefor in the Bond Fund under the Mortgage and Trust Indenture (the
"Indenture") dated as of September 1, 1993, among the Company, the City of
Mishawaka, Indiana (the "Municipality"), and INB National Bank, as trustee
(the "Trustee"), will equal the principal amount of the Bonds (defined
below) which becomes due on that date; (b) on the first day of each April
and the first day of each October commencing April 1, 1994, and continuing
through October 1, 2000, a sum which, together with other moneys available
therefor in the Bond Fund under the Indenture, will equal the interest
which becomes due on the Bonds outstanding on that date; (c) on the dates
fixed for redemption of the Bonds in whole or in part, the principal of,
premium, if any, and interest on the Bonds to be redeemed to the date
fixed for redemption; and (d) immediately upon a declaration of
acceleration of the maturity of the Bonds by the Trustee, the principal,
interest, and premium, if any, to the date of declaration of acceleration.
All payments of principal, premium, if any, and interest are to
be made directly to the Trustee (or subsequent registered owner) for the
account of the Municipality in immediately available funds. This Note is
security for the payment of the Municipality's Economic Development
Refunding Revenue Bonds, Series 1993 (Elco Industries, Inc./
Thermoplastics, Inc. Project) issued pursuant to the Indenture (the
"Bonds"). All of the terms, conditions, and provisions of the Indenture
are incorporated into this Note by reference.
This Note is issued pursuant to the Loan Agreement (the
"Agreement") dated as of September 1, 1993, between the Municipality and
the Company and is entitled to the benefits, and is subject to the
conditions, thereof. The obligation of the Company to make the payments
required under this Note is absolute and unconditional without any defense
or right of setoff, counterclaim or recoupment by reason of any default by
the Municipality under the Agreement or under any other agreement between
the Company and the Municipality or out of any indebtedness or liability
at any time owing to the Company by the Municipality or for any other
reason.
This Note is subject to prepayment under the terms and
conditions, and in the amounts, provided in Article VII of the Agreement.
This Note is transferable only upon the books of the Trustee kept
for that purpose at its principal office in its capacity as Note
Registrar, upon surrender for transfer of this Note at the principal
office of the Trustee, endorsed for transfer by the registered owner or
accompanied by an assignment executed by the registered owner or his
authorized attorney. Upon such surrender for transfer, the Trustee shall
validate and deliver in the name of the transferee a new Note which shall
have been executed by the Company. If the Company fails to make any of
the payments under this Note, the amount unpaid shall continue as an
obligation of the Company until fully paid and shall bear interest (to the
extent permitted by law) until paid at a per annum rate of interest equal
to the per annum rate then in effect on the Bonds plus two percent (2%) or
at the maximum rate permitted by law, whichever is
lesser. If an "Event of Default" occurs under Section 8.1 of the
Agreement, the principal of this Note may be declared due and payable as
provided in Article VIII of the Agreement.
Where a date of payment is not a business day in the City of
Indianapolis, Indiana, Rockford, Illinois, or Chicago, Illinois, then
payment may be made on the first business day thereafter.
All amounts payable under the terms of this Note are payable
without relief from valuation and appraisement laws and with attorneys'
fees. The maker and any endorsers waive demand, presentment for payment,
protest, notice of protest and notice of non.payment or dishonor and
consent to any and all extensions of time for payment without notice.
All terms used in this Note which are defined in the Agreement
and not in this Note shall have the meanings assigned to them in the
Agreement.
IN WITNESS WHEREOF, the Company has caused this Note to be
executed and delivered this _____ day of September, 1993.
THERMOPLASTICS, INC.
By:____________________________________
August F. DeLuca, Vice President
ATTEST:
____________________________________
Kenneth L. Heal, Secretary/Treasurer
(Form of Note Registrar's Certificate of Validation)
NOTE REGISTRAR'S CERTIFICATE OF VALIDATION
It is hereby certified that this Note has been duly validated by
the Note Registrar.
INB NATIONAL BANK
as Trustee
By:_______________________________
Authorized Representative
(Form of Assignment)
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________ ________________________________________
(Please print or typewrite name (Social security or federal employer and
address including postal zip identification number of assignee)
code of transferee)
the within Note, together with accrued interest thereon and all right,
title and interest thereto, and hereby irrevocably authorize(s) and
appoint(s) any authorized officer of the Trustee under the Indenture, as
such term is defined in said Note, attorney to transfer said Note on the
books of the within named Note Registrar, with full power of substitution
in the premises.
Dated:___________________________
__________________________________________
In the presence of:
____________________________
NOTICE--The signatures to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular,
without alteration or enlargement or any change whatever.