SUPPLEMENT TO FINANCING DOCUMENTS (INDENTURE OF TRUST AND LOAN
AGREEMENT) RELATING TO INDUSTRIAL DEVELOPMENT AUTHORITY OF THE CITY
OF SANTA ANA, 1985 INDUSTRIAL DEVELOPMENT REVENUE BONDS (MICROSEMI
CORPORATION PROJECT) DATED AS OF JANUARY 15, 1995
This Supplement to Financing Documents (the "1995 Amendment")
relating to the Industrial Development Authority of the City of
Santa Ana (the "Issuer") issue of bonds entitled 1985 Industrial
Development Revenue Bonds (Microsemi Corporation Project), (the
"Bonds") is entered into by and among the Issuer, First Interstate
Bank of California, as trustee (the "Trustee") and Microsemi
Corporation (the "Borrower").
RECITALS
1. The Issuer has previously issued the Bonds to provide
financing for the manufacturing project of the Borrower pursuant to
an indenture of trust (the "Indenture") dated as of February 1,
1985, by and between the Issuer and the Trustee as amended by a
certain Supplemental Indenture No. 1, dated as of January 1, 1992.
2. The proceeds of the Bonds were loaned to the Borrower to
provide financing for a manufacturing project located within the
City of Santa Ana pursuant to that certain loan agreement (the
"Loan Agreement") dated as of February 1, 1985, by and between the
Issuer and the Borrower.
3. The Bonds are subject to remarketing pursuant to the
Indenture on February 1, 1995, (the "Reset Date") and, pursuant to
the Indenture and Loan Agreement, Stone & Youngberg (the
"Remarketing Agent") has been appointed Remarketing Agent in
connection therewith.
4. The parties hereto wish to amend (or consent to the
amendment, as applicable) of the Indenture and the Loan Agreement
to facilitate the remarketing of the Bonds on the Reset Date on
terms which are consistent with the requirements of the
Reimbursement Agreement (as defined in the Indenture) and efficient
for the Borrower, to the extent set forth in this 1995 Amendment.
5. The Trustee has confirmed to the Issuer and the Bondholder
that the requisite consent of the Bond Owner (as defined in the
Indenture) and the Bank (as defined in the Indenture) to these
amendments has been obtained, and Standard & Poor's Ratings Group
has issued its rating to be applicable to the Bonds from and after
the Reset Date.
AGREEMENT
1. Amendments to Indenture. The Issuer and the Trustee hereby
agree that the Indenture shall be and is hereby amended as set
forth in this section, and the Borrower hereby consents to such
amendments.
(a) The following changes to the definitions set forth in
Section 1.01 of the Indenture are made:
(i) The following definitions are hereby amended and
restated in their entirety to read as follows:
"Act of Bankruptcy" means the filing of a petition in
bankruptcy (or other commencement of a bankruptcy or similar
proceeding) by or against the Borrower, the Issuer or any guarantor
of the Borrower under any applicable bankruptcy, insolvency or
similar law as now or hereafter in effect.
"Alternate Letter of Credit" means a letter of credit
(other than the original Letter of Credit or any Substitute Letter
of Credit), or, with the written consent of the Issuer, a committed
line of credit, bond purchase agreement, surety bond, bond
insurance policy or other instrument, or any combination thereof,
issued pursuant to Section 4.02(e) of the Loan Agreement in
anticipation of the expiration or replacement of the Letter of
Credit, issued by a financial institution, under the terms of which
the Trustee is authorized to draw an amount to pay when due,
whether at maturity or prior thereto upon redemption or
acceleration, the principal of and interest and premium (other than
principal or premium upon optional redemption) on the Bonds, except
to the extent that Eligible Funds shall be on deposit in the Bond
Fund and available to make any such payment.
"Eligible Funds" means moneys: (a) deposited by the
Borrower with the Trustee and so designated by the Borrower, which
moneys shall have been held by the Trustee in a segregated account
of the Bond Fund for such purposes (the "Eligible Funds Account")
for at least 123-days prior to the date notice of redemption is
given in connection with a redemption of Bonds, provided that no
Act of Bankruptcy shall have occurred during such 123-day period
after such moneys were deposited with the Trustee in the Eligible
Funds Account (the Trustee shall be entitled to rely on a
certificate of the Borrower to the effect that no Act of Bankruptcy
has occurred as evidence that no Act of Bankruptcy has occurred),
or (b) derived from proceeds of the Bonds held by the Trustee in a
segregated account from the date of issuance of the Bonds, or (c)
which constitute proceeds of refunding bonds or moneys from any
other source, including amounts provided by the Borrower, or any
guarantor of the Borrower, so long as the Trustee receives an
opinion from Bond Counsel, or nationally recognized bankruptcy
counsel acceptable to S&P's, prior to the giving of notice of
redemption of any Bonds to the effect that such moneys are not
recapturable as a preferential payment by any trustee in bankruptcy
under the United States Bankruptcy Code in the event of an Act of
Bankruptcy, or (d) the investment of any of the moneys above once
they constitute Eligible Funds, or (e) which constitute any
combination of the foregoing.
"1986 Code" means the Internal Revenue Code of 1986 as in
effect on February 1, 1995 or (except as otherwise referenced
herein) as it may be amended to apply to obligations issued on
February 1, 1995, together with applicable proposed, temporary and
final regulations promulgated, and applicable official public
guidance published, under the 1986 Code.
"Permitted Investments" means any of the following which
at the time of investment are legal investments under the laws of
the State for the moneys proposed to be invested therein:
(a) Federal Securities;
(b) interest-bearing demand or time deposits
(including certificates of deposit) in federal or State chartered
savings and loan associations or in national or State banks
(including the Trustee) either (a) the obligations of which or the
obligations of the holding company of which are rated at least as
high as the then existing rating on the Bonds by Moody's (if the
Bonds are then rated by Moody's) and by S&P's (if the Bonds are
then rated by S&P's), or (b) which have deposits insured by the
Federal Deposit Insurance Corporation or in federal savings and
loan associations or State chartered savings and loan associations
which have deposits insured by the Federal Savings and Loan
Insurance Corporation, provided, however, that the portion of such
certificates of deposit in excess of the amount insured by the
Federal Deposit Insurance Corporation or the Federal Savings and
Loan Insurance Corporation, if any, shall be secured at all times
in the manner provided by law by collateral security having a
market value not less than the amount of such excess, consisting of
Federal Securities;
(c) obligations issued by any corporation organized
and operating within the United States of America having assets in
excess of $500,000,000, which obligations are rated at least as
high as the then existing rating on the Bonds by Moody's (if the
Bonds are then rated by Moody's) and by S&P's (if the Bonds are
then rated by S&P's);
(d) money market funds which are rated at least as
high as the then existing rating on the Bonds by Moody's (if the
Bonds are then rated by Moody's) and by S&P's (if the Bonds are
then rated by S&P's) including funds for which First Interstate
Bancorp, its affiliates or subsidiaries provide investment advisory
or other management services, if so rated;
(e) bills of exchange or time drafts drawn on and
accepted by a commercial bank, otherwise known as bankers
acceptances, which are eligible for purchase by the Federal Reserve
System and the obligations of which commercial bank or the
obligations of the holding company of which are rated at least as
high as the then existing rating on the Bonds by Moody's (if the
Bonds are then rated by Moody's) and by S&P's (if the Bonds are
then rated by S&P's); and "S&P's" means Standard & Poor's Ratings
Group, or its successors.
(ii) the following definitions are added to Section 1.01,
to be inserted in alphabetical order:
"Depository" or "DTC" means The Depository Trust
Company, New York, New York, a limited purpose trust company
organized under the laws of the State of New York in its capacity
as securities depository for the Bonds.
"Letter of Representations" means the letter of the
Issuer and the Trustee delivered to and accepted by the Depository
on or prior to issuance of the Bonds as book-entry bonds setting
forth the basis on which the Depository serves as depository for
such book-entry bonds, as originally executed or as it may be
supplemented or revised or replaced by a letter from the Issuer and
the Trustee delivered to and accepted by the Depository in
substantially the form attached hereto as Exhibit B.
"Nominee" means the nominee of the Depository, which
may be the Depository, as determined from time to time pursuant to
Section 2.09 hereof.
"Participants" means those broker-dealers, banks and
other financial institutions from time to time for which the
Depository holds book-entry bonds as securities depository.
(iii) the definition of the term "Rating Category" or
"Rating Categories" is hereby deleted in its entirety.
(b) The last sentence of the first paragraph of
Section 2.02 of the Indenture is hereby amended in full to read as
follows:
"The Bonds shall be dated February 1, 1985 and
shall mature on the dates and bear interest from and after the
Reset Date at the rates per annum as set forth below:
Maturity Amount Interest Rate
February 1, 1998 $1,050,000 6.00%
February 1, 1999 100,000 6.15%
February 1, 2000 100,000 6.30%
February 1, 2001 100,000 6.40%
February 1, 2002 100,000 6.50%
February 1, 2003 100,000 6.60%
February 1, 2004 100,000 6.70%
February 1, 2005 3,700,000 6.90%
(c) There is hereby amended into the Indenture a
new Section 2.09, to read in full as follows:
Section 2.09. Book-Entry System.
(a) Election of Book-Entry System. On or prior to
the remarketing of the Bonds on the Reset Date, the Issuer may
provide that such Bonds shall be initially issued as book-entry
Bonds. If the Issuer shall elect to deliver any Bonds in
book-entry form, then the Issuer shall cause the delivery of a
separate single fully registered bond (which may be typewritten)
for each maturity date of such Bonds in an authorized denomination
corresponding to that total principal amount of the Bonds
designated to mature on such date. Upon initial issuance, the
ownership of each such Bond shall be registered in the Bond
Registration Books in the name of the Nominee, as nominee of the
Depository and ownership of the Bonds, or any portion thereof, may
not thereafter be transferred except as provided in Section
2.09(e).
With respect to book-entry Bonds, the Issuer
and the Trustee shall have no responsibility or obligation to any
Participant or to any person on behalf of which such a Participant
holds an interest in such book-entry Bonds. Without limiting the
immediately preceding sentence, the Issuer and the Trustee shall
have no responsibility or obligation with respect to (i) the
accuracy of the records of the Depository, the Nominee, or any
Participant with respect to any ownership interest in book-entry
Bonds, (ii) the delivery to any Participant or any other person,
other than an Owner as shown in the Bond Registration Books, of any
notice with respect to book-entry Bonds, including any notice of
redemption, (iii) the selection by the Depository and its
Participants of the beneficial interests in book-entry Bonds to be
redeemed in the event the Issuer redeems the Bonds in part, or (iv)
the payment by the Depository or any Participant or any other
person, of any amount of principal of, premium, if any, or interest
on book-entry Bonds. The Issuer and the Trustee may treat and
consider the person in whose name each book-entry Bond is
registered in the Bond Registration Books as the absolute Owner of
such book-entry Bond for the purpose of payment of principal of,
premium and interest on such Bond, for the purpose of giving
notices of redemption and other matters with respect to such Bond,
for the purpose of registering transfers with respect to such Bond,
and for all other purposes whatsoever. The Trustee shall pay all
principal of, premium, if any, and interest on the Bonds only to or
upon the order of the respective Owner, as shown in the Bond
Registration Books, or his respective attorney duly authorized in
writing, and all such payments shall be valid and effective to
fully satisfy and discharge the Issuer's obligations with respect
to payment of principal of, premium, if any, and interest on the
Bonds to the extent of the sum or sums so paid. No person other
than an Owner, as shown in the Bond Registration Books, shall
receive a Bond evidencing the obligation to make payments of
principal of, premium, if any, and interest on the Bonds. Upon
delivery by the Depository to the Owner and the Trustee, of written
notice to the effect that the Depository has determined to
substitute a new nominee in place of the Nominee, and subject to
the provisions of Section 2.02 hereof with respect to record dates,
the word Nominee in this Indenture shall refer to such nominee of
the Depository.
(b) Delivery of Letter of Representations. In
order to qualify the book-entry Bonds for the Depository's
book-entry system, the Issuer and the Trustee shall execute and
deliver to the Depository a Letter of Representations. The
execution and delivery of a Letter of Representations shall not in
any way impose upon the Issuer or the Trustee any obligation
whatsoever with respect to persons having interests in such
book-entry Bonds other than the Owners, as shown on the Bond
Registration Books. By executing a Letter of Representations, the
Trustee shall agree to take all action necessary at all times so
that the Issuer will be in compliance with all representations of
the Issuer in such Letter of Representations. In addition to the
execution and delivery of a Letter of Representations, the Issuer
and the Trustee shall take such other actions, not inconsistent
with this Indenture, as are reasonably necessary to qualify
book-entry Bonds for the Depository's book-entry program.
(c) Selection of Depository. In the event (i) the
Depository determines not to continue to act as securities
depository for book-entry Bonds, or (ii) the Issuer determines
that continuation of the book-entry system is not in the best
interest of the beneficial owners of the Bonds or the Issuer, then
the Issuer will discontinue the book-entry system with the
Depository. If the Issuer determines to replace the Depository
with another qualified securities depository, the Issuer shall
prepare or direct the preparation of a new single, separate, fully
registered Bond for each of the maturity dates of such book-entry
Bonds, registered in the name of such successor or substitute
qualified securities depository or its Nominee as provided in
subsection (e) hereof. If the Issuer fails to identify another
qualified securities depository to replace the Depository, then the
Bonds shall no longer be restricted to being registered in such
Bond register in the name of the Nominee, but shall be registered
in whatever name or names the Owners transferring or exchanging
such Bonds shall designate, in accordance with the provisions of
Sections 2.03 and 2.04 hereof.
(d) Payments To Depository. Notwithstanding any
other provision of this Indenture to the contrary, so long as all
Outstanding Bonds are held in book-entry and registered in the name
of the Nominee, all payments of principal of, redemption premium,
if any, and interest on such Bond and all notices with respect to
such Bond shall be made and given, respectively, to the Nominees,
as provided in the Letter of Representations or as otherwise
instructed by the Depository and agreed to by the Trustee
notwithstanding any inconsistent provisions herein.
(e) Transfer of Bonds to Substitute Depository.
(i) The Bonds shall be initially issued as
provided in Section 2.01 hereof. Registered ownership of such
Bonds, or any portions thereof, may not thereafter be transferred
except:
(A) to any successor of DTC or its
nominee, or of any substitute depository designated pursuant to
clause (B) of subsection (i) of this Section 2.09(e) ("Substitute
Depository"); provided that any successor of DTC or Substitute
Depository shall be qualified under any applicable laws to provide
the service proposed to be provided by it;
(B) to any Substitute Depository, upon
(1) the resignation of DTC or its successor (or any Substitute
Depository or its successor) from its functions as depository, or
(2) a determination by the Issuer that DTC (or its successor) is no
longer able to carry out its functions as depository; provided that
any such Substitute Depository shall be qualified under any
applicable laws to provide the services proposed to be provided by
it; or
(C) to any person as provided below, upon
(1) the resignation of DTC or its successor (or any Substitute
Depository or its successor) from its functions as depository, or
(2) a determination by the Issuer that DTC or its successor (or
Substitute Depository or its successor) is no longer able to carry
out its functions as depository or to discontinue the book entry
system.
(ii) In the case of any transfer pursuant to
clause (A) or clause (B) of subsection (i) of this Section 2.09(e),
upon receipt of all Outstanding Bonds by the Trustee, together with
a written request of the Issuer to the Trustee designating the
Substitute Depository, a single new Bond, which the Issuer shall
prepare or cause to be prepared, shall be issued for each maturity
of Bonds then Outstanding, registered in the name of such successor
or such Substitute Depository or their Nominees, as the case may
be, all as specified in such written request of the Issuer. In the
case of any transfer pursuant to clause (C) of subsection (i) of
this Section 2.09(e), upon receipt of all Outstanding Bonds by the
Trustee, together with a written request of the Issuer to the
Trustee, new Bonds, which the Issuer shall prepare or cause to be
prepared, shall be issued in such denominations and registered in
the names of such persons as are requested in such written request
of the Issuer, subject to the limitations of Section 2.01 hereof,
provided that the Trustee shall not be required to deliver such new
Bonds within a period of less than sixty (60) days from the date of
receipt of such written request from the Issuer.
(iii) In the case of a partial redemption or an
advance refunding of any Bonds evidencing a portion of the
principal maturing in a particular year, DTC or its successor (or
any Substitute Depository or its successor) shall make an
appropriate notation on such Bonds indicating the date and amounts
of such reduction in principal, in form acceptable to the Trustee,
all in accordance with the Letter of Representations. The Trustee
shall not be liable for such Depository's failure to make such
notations or errors in making such notations.
(iv) The Issuer and the Trustee shall be
entitled to treat the person in whose name any Bond is registered
as the Owner thereof for all purposes of this Indenture and any
applicable laws, notwithstanding any notice to the contrary
received by the Trustee or the Issuer; and the Issuer and the
Trustee shall not have responsibility for transmitting payments to,
communicating with, notifying, or otherwise dealing with any
beneficial owners of the Bonds. Neither the Issuer nor the Trustee
shall have any responsibility or obligation, legal or otherwise, to
any such beneficial owners or to any other party, including DTC or
its successor (or Substitute Depository or its successor), except
to the Owner of any Bonds, and the Trustee may rely conclusively on
its records as to the identity of the Owners of the Bonds.
(d) Section 4.01 of the Indenture is hereby amended as
follows:
(1) The optional redemption schedule applicable to the
Bonds after the Reset Date set forth in subsection (a) of Section
4.01 is hereby amended and restated in full as follows:
"After the Reset Date Redemption Price
February 1, 2003 to January 31, 2004 101%
February 1, 2004 and thereafter 100%
(2) Section 4.01(c) of the Indenture is hereby amended
and restated in full to read as follows:
(c) The Bonds are also subject to optional redemption by the
Issuer on any Payment Date from excess moneys in the Construction
Fund transferred to the Bond Fund and elected to be used for such
purpose pursuant to Section 3.03 hereof, in whole, or in part by
lot, without premium to the extent such moneys constitute Eligible
Funds."
(e) Section 4.02 of the Indenture is hereby amended as
follows:
(1) Section 4.02(b)(i) of the Indenture is hereby
amended and restated to read in full as follows:
(i) The Substitute Letter of Credit shall be an
irrevocable letter of credit substantially identical in form and
substance to the Letter of Credit and shall be reasonably
acceptable to the Trustee and delivery of such letter of credit
shall be accompanied by written evidence from S&P's (if the Bonds
are rated by S&P's) that such substitution will not cause the
rating on the Bonds to be lower than the rating assigned to the
Bonds; moreover, if the rating assigned to the Bonds following the
delivery of the Substitute Letter of Credit will be lower than
S&P's A+ (or Moody's equivalent), so long as any Defined Asset Fund
sponsored by Merrill Lynch, Pierce, Fenner & Smith Incorporated
owns any Bonds the prior written consent of the Trustee for such
Fund shall also be required, which consent shall not unreasonably
be withheld."
(2) The mandatory sinking fund redemption schedule set
forth in Section 4.02(c) is amended to reflect an additional
Sinking Fund Payment applicable to the Bonds maturing February 1,
2005 of $350,000 payable February 1, 1995. Notwithstanding
anything to the contrary in the Indenture, the
Remarketing Agent shall not remarket a principal amount of
Outstanding Bonds equal to the February 1,1995 Sinking Fund
Payment, and such principal amount of Bonds shall be promptly
cancelled by the Trustee upon the Trustee's payment (or deemed
payment) of the redemption price of such Bonds from the proceeds of
a drawing on the Letter of Credit, without regard to the notice or
other requirements of the Indenture for such sinking fund
redemption.
(3) The last sentence of Section 4.02(d) is hereby
amended and restated in full to read as follows:
"Such redemption shall be made on the Reset Rate
or expiration date, whichever is earlier."
(f) The last paragraph of Section 5.01 of the Indenture is
hereby amended and restated in full to read as follows:
"The Issuer hereby approves the form and terms of the
Letter of Credit as finally executed by the Bank and hereby
authorizes and directs the Trustee to exercise its rights
thereunder. The Trustee shall draw under the Letter of Credit in
accordance with its terms, subject to the terms hereof and of the
Agreement, at such times and in such amounts as is sufficient to
receive moneys thereunder on each interest Payment Date and
redemption date to make timely payments of the principal of and
interest on the Bonds in accordance with the terms hereof, and to
pay the premium payable hereunder (exclusive of any principal or
premium payable under Section 4.01(a) hereunder) with the proceeds
of a draw on the Letter of Credit. All amounts drawn on the Letter
of Credit shall be deposited in the Letter of Credit Fund by the
Trustee promptly upon the receipt thereof. The Trustee may accept
any Alternate Letter of Credit provided in accordance with the
terms hereof and of the Loan Agreement and, upon such acceptance,
shall return the replaced Letter of Credit to the Bank. The
Trustee shall make interest drawings monthly on the Letter of
Credit in an amount equal to the interest coming due on the Bonds
on the next succeeding Payment Date at such time as will cause
payment to be received on the applicable Payment Date."
(g) The last paragraph of Section 5.03 of the Indenture is
hereby amended and restated in full to read as follows:
"Notwithstanding anything stated in Section 5.02 hereof,
or stated elsewhere in this Indenture, the Trustee shall only apply
proceeds of a drawing on the Letter of Credit deposited in the
Letter of Credit Fund and moneys in the Bond Fund to the payment of
principal of and interest and premium, if any, on the Bonds in the
following order of priority: (1) amounts derived from a drawing on
the Letter of Credit, or (2) Eligible Funds."
(h) The first paragraph of Section 5.04 of the Indenture is
hereby amended and restated in full to read as follows:
"Section 5.04. Investments of Moneys in Special Funds.
Subject to the limitations contained in Sections 5.05 and 5.06
hereof, any moneys in any of the funds to be established by the
Trustee pursuant to Sections 3.03, 4.02(c), 5.02 and 5.03 shall be
invested upon the written request of the Borrower by the Trustee,
if and to the extent then permitted by law, in any of the
following, provided that the Trustee shall not be required to make
any investment inconsistent with its fiduciary duties or any
provisions of this Indenture: (a) Federal Securities, or (b)
Permitted Investments; provided that (1) amounts drawn on the
Letter of Credit may be invested and reinvested by the Trustee,
only in Federal Securities maturing not more than thirty (30) days
after the date on which they are acquired, and (2) amounts in the
Bond Fund shall not be invested in any instruments bearing a credit
rating by Moody's if the Bonds are then rated by Moody's, and
S&P's, if the Bonds are then rated by S&P's, which is lower than
the rating(s) assigned to the Bonds. All such investments shall
mature not later, nor, to the extent reasonably practicable,
earlier, than the date such moneys or investment proceeds are
required for application hereunder. If the written investment
request of the Borrower is not timely received by the Trustee,
Trustee shall invest in those investments defined in clause (d) of
the definition of Permitted Investments."
(i) Section 5.06 of the Indenture is hereby amended by
adding a new subsection (f) and (g) at the end thereof, to read as
follows:
(f) Rebate Requirement. The Authority shall take and
shall cause the Borrower and Bank to take any and all actions
necessary to assure compliance with Section 148(f) of the 1986
Code, relating to the rebate of excess investment earnings, if any,
to the federal government to the extent that such section is
applicable to the Bonds.
(g) No Arbitrage. The Authority shall not take, or
permit or suffer to be taken by the Trustee, the Borrower, the Bank
or otherwise, any action with respect to the proceeds of the Bonds
which, if such action had been reasonably expected to have been
taken, or had been deliberately and intentionally taken, on the
Reset Date would have caused the Bonds to be "arbitrage bonds"
within the meaning of Section 148 of the 1986 Code."
(j) The following sentence is added at the end of the
penultimate paragraph of Section 7.01 of the Indenture:
"Following the date of such acceleration and
payment on the Bonds, further interest shall cease to accrue on the
Bonds."
(k) Section 8.08(d) of the Indenture is hereby amended
and restated in full to read as follows:
"Any resignation or removal of the Trustee and
appointment of a successor trustee pursuant to any of the
provisions of this Section 8.08 shall become effective only upon
acceptance of appointment by the successor trustee as provided in
Section 8.09, upon transfer of the Letter of Credit to the
successor trustee, and upon the consent of the Borrower which shall
not be unreasonably withheld."
(l) In addition to all other notices required to be
given under the Indenture, the Trustee shall provide S&P's with
written notice of any Event of Default under the Indenture, of any
amendment or supplement to the Indenture for which Bond Owner
consent is required, or of any substitution or replacement of an
existing Letter of Credit with an Alternate Letter of Credit
or Substitute Letter of Credit in accordance with the terms of the
Indenture.
(m) The form of Bond to be effective from and after
the Reset Date hereby is amended in full from that set forth in the
Recitals to the form as set forth in Exhibit A attached hereto and
incorporated herein by reference, to be effective from and after
the Reset Date.
(n) Anything to the contrary in the Indenture
notwithstanding, all action and proceedings of the Trustee, the
Issuer, the Remarketing Agent and the Borrower in connection with
the remarketing of the Bonds on the Reset Date are hereby ratified,
confirmed and approved and shall be deemed undertaken in compliance
with the Indenture in all respects, and that certain extended
Letter of Credit of the Bank dated as of February 1, 1995 and held
by the Trustee is hereby confirmed and shall be treated as an
Alternate Letter of Credit for all purposes of the Indenture.
2. The Issuer and the Borrower hereby agree that the Loan
Agreement shall be and is hereby amended as set forth in this
Section, and the Trustee hereby consents to such amendment.
(a) Section 4.02(a) of the Loan Agreement is hereby
amended in full to read as follows:
"(a) Repayment Installments. In consideration of
the loan and advance made to the Borrower hereunder (and pursuant
to the procedures established in the Indenture), the Borrower
agrees that it will pay to the Issuer installments of principal and
interest on the Loan (and premium under certain circumstances as
provided in the Indenture) in the amounts and at the times as
follows: (i) on the first day of each month commencing May 1, 1985
an amount equal to the interest coming due on the Bonds on such
interest Payment Date, provided that the installment of interest
payable on May 1, 1985 shall equal $150,312.50; (ii) commencing
February 1, 1986, and annually thereafter to and including February
1, 1995, an amount equal to the sinking fund payment due on each of
such sinking fund payment dates pursuant to the Indenture; and
(iii) the principal due on the Bonds on such dates as provided
in the Indenture, with all unpaid principal to be due and payable
February 1, 2005."
(b) Section 4.02(e) of the Loan Agreement is hereby
amended and restated to read in full as follows:
"(e) Alternate Letter of Credit. The Borrower
may, at its election, at any time at least forty-five (45) days
prior to the date of expiration of any Letter of Credit, provide
for the delivery to the Trustee of either (1) an extension of the
original Letter of Credit, or (2) an Alternate Letter of Credit.
Borrower may replace any Letter of Credit with an Alternate
Letter of Credit at any time; provided that, so long as any Defined
Asset Fund sponsored by Merrill Lynch, Pierce, Fenner & Smith
Incorporated owns any Bonds, if such replacement will cause the
rating on the Bonds to be lower than S&P's A+ (or Moody's
equivalent), the prior written consent of the trustee for such Fund
shall be required to the replacement of any Letter of Credit prior
to its stated expiration date, which consent shall not unreasonably
be withheld. Notwithstanding anything herein to the contrary such
extension or replacement of the original Letter of Credit or such
Alternate Letter of Credit (i) shall not expire prior to April 15,
1995 if delivered prior thereto, (ii) shall have a term of at least
three (3) years, (iii) shall permit the Trustee to draw thereunder
to pay when due the principal and interest and premium on the Bonds
(other than principal and premium upon optional redemption), and
(iv) shall be accompanied by written evidence from S&P's, if the
Bonds are then rated by S&P's, and Moody's, if the Bonds are
then rated by Moody's, to the effect that such substitution or
replacement will not cause the then existing rating on the Bonds to
be reduced or withdrawn."
(c) Anything to the contrary in the Loan Agreement
notwithstanding, all action and proceedings of the Trustee and the
Issuer and the Borrower in connection with the remarketing of the
Bonds on the Reset Date are hereby ratified, confirmed and approved
and shall be deemed undertaken in compliance with the Loan
Agreement in all respects, and that certain extended Letter of
Credit of the Bank dated as of February 1, 1995 and held by the
Trustee is hereby confirmed and shall be treated as an Alternate
Letter of Credit for all purposes of the Loan Agreement.
3. It is the intent of the parties that these amendments
shall cause all requirements of the Indenture and Loan Agreement
applicable to the remarketing of the Bonds and the replacement of
the original Letter of Credit with that certain Letter of Credit of
the Bank dated February 1, 1995 to be met or waived; provided,
however, nothing herein shall be deemed to waive or alter any
provision of any of the Financing Documents necessary to preserve
and maintain or relating to the ongoing excludibility from gross
income of interest on the Bonds for purposes of federal income
taxation.
4. This 1995 Amendment shall be effective on or after
February 1, 1995 upon its execution by the parties hereto and
confirmation of the consent of the Bond Owners (obtained in
accordance with the requirements of the Indenture) and the Bank,
together with evidence of Standard & Poor's Rating Group review of
this 1995 Amendment and receipt of a rating on the Bonds equal
to or better than "A+".
INDUSTRIAL DEVELOPMENT AUTHORITY OF
THE CITY OF SANTA ANA
By: /s/ David N. Ream
Its: Executive Director
ATTEST
/s/ Janice C. Guy
Secretary
FIRST INTERSTATE BANK OF CALIFORNIA,
as Trustee
By: /s/ Teresa Fructuoso
Its: Authorized Officer
MICROSEMI CORPORATION
By: /s/ David R. Sonksen
Its: President
We hereby consent to the 1995 Amendment to Financing Documents
attached hereto.
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By: /s/ Leslie Reuter
Its: Authorized Officer
STONE & YOUNGBERG, Remarketing Agent
and Purchaser of Bonds pursuant to
Remarketing Agreement
By: /s/ Warren E. Miller
Its: Authorized Officer
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED, Defined Asset Funds, as
sole Bondholder of Remarketed Bonds
By: /s/ James J. King, Jr.
Its: Authorized Signatory
CHASE MANHATTAN BANK, on behalf of
TUTTLE & CO., Sole Bondholder
By: /s/ Michael Ross
Its: Authorized Signatory
EXHIBIT A
FORM OF BOND
No. R- $
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
INDUSTRIAL DEVELOPMENT AUTHORITY
OF THE CITY OF SANTA ANA
1985 INDUSTRIAL DEVELOPMENT REVENUE BOND
(MICROSEMI CORPORATION PROJECT)
MATURITY DATE DATED DATE INTEREST RATE CUSIP NO.
February 1, 1985
NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE
OF CALIFORNIA OR THE CITY OF SANTA ANA IS PLEDGED TO THE PAYMENT OF
THE PRINCIPAL OF, PREMIUM, IF ANY, OR INTEREST ON ANY BOND, NOR IS
THE STATE OR SUCH CITY IN ANY MANNER OBLIGATED TO MAKE ANY
APPROPRIATION FOR PAYMENT.
The INDUSTRIAL DEVELOPMENT AUTHORITY OF THE CITY OF SANTA ANA
(the "Issuer"), a public, corporate instrumentality of the State of
California, for value received, hereby promises to pay (but only
out of Revenues as hereinafter provided) to CEDE & CO. or
registered assigns, on the maturity date set forth above, the
principal sum set forth above in lawful money of the United States
of America; and to pay interest thereon in like money from the
interest payment date next preceding the date of registration of
this Bond (unless this Bond is registered following the close of
business on the 15th day of the month preceding an interest payment
date and on or before such interest payment date, in which event it
shall bear interest from such interest payment date, or unless this
Bond is registered prior to February 15, 1995, in which event it
shall bear interest from February 1, 1995) at the rate per annum
set forth above, calculated on the basis of a 360-day year of
twelve thirty-day months, payable on March 1, 1995, and thereafter
on the first day of each month until the payment of such principal
sum in accordance with the terms hereof. The final payment hereof
is payable upon surrender at the principal corporate trust office
of First Interstate Bank of California, as trustee (the "Trustee"),
in Los Angeles, California, or at the office of any paying agent,
and the interest hereon and payment of principal hereof (other than
the final payment) is payable by check or draft (or at the request
of any Bond owner of at least $100,000 of Bonds by wire transfer of
immediately available funds as set forth in the Indenture) to the
person whose name appears on the bond registration books of the
Trustee as the registered owner hereof as of the close of business
on the fifteenth day before each interest payment date, whether or
not such day is a business day.
This Bond is one of a duly authorized issue of bonds of the
Issuer designated as the "Industrial Development Authority of the
City of Santa Ana, 1985 Industrial Development Revenue Bonds
(Microsemi Corporation Project)" (the "Bonds"), limited in the
original aggregate principal amount to Six Million Five Hundred
Thousand Dollars ($6,500,000), of the designation indicated on the
face hereof, all issued under and equally secured by an Indenture
of Trust (the "Indenture"), dated as of February 1, 1985 between
the Issuer and the Trustee, as amended heretofore or hereafter.
The proceeds of the Bonds will be used to make a loan (the "Loan")
to Microsemi Corporation, a Delaware corporation (the "Borrower"),
evidenced by a Loan Agreement (the "Loan Agreement"), dated as of
February 1, 1985 between the Borrower and the Issuer, which has
been used for the acquisition, construction and equipping of
certain manufacturing facilities by the Borrower located in the
City of Santa Ana, California. The payment of the principal of
(except upon optional redemption) and interest and premium (under
certain circumstances as provided in the Indenture and the Loan
Agreement) on the Bonds will be fully secured by an irrevocable
Letter of Credit (the "Letter of Credit") issued by Bank of
America National Trust and Savings Association (the "Bank"),
pursuant to a Reimbursement Agreement (the "Reimbursement
Agreement"), dated February 1, 1985 between the Borrower and the
Bank, as amended heretofore or hereafter.
Repayment of the Loan will be secured by a First Deed of Trust
dated February 1, 1985, naming the Trustee as beneficiary.
Reference is hereby made to the Indenture and all indentures
supplemental thereto, and to the Loan Agreement, for a description
of the rights under the Indenture of the registered owners
of the Bonds, of the nature and extent of the security, of the
rights, duties and immunities of the Trustee and of the rights and
obligations of the Issuer thereunder, to all of the provisions of
which Indenture and Loan Agreement the owner of this Bond, by
acceptance hereof, assents and agrees.
The Bonds are authorized to be issued pursuant to the
provisions of the California Industrial Development Financing Act,
constituting Title 10 of the Government Code of the State of
California, as now in effect or as hereafter amended (the "Act").
The Bonds are limited obligations of the Issuer and, as and to the
extent set forth in the Indenture, are payable solely from, and
secured by a pledge of and lien on, the Revenues (as such term is
defined in the Indenture).
The Indenture contains provisions permitting the Issuer and
the Trustee, with the consent of the owners of not less than ninety
percent (90%) in aggregate principal amount of the Bonds at the
time outstanding, evidenced as in the Indenture provided, to
execute supplemental indentures adding any provisions to, or
changing in any manner, or eliminating any of the provisions
of the Indenture; provided, however, that changes not to the
prejudice of the Trustee or the owners of the Bonds may be made
without the consent of such owners and that no such Supplemental
Indenture shall (1) extend the fixed maturity of this Bond or
reduce the rate of interest hereon or extend the time of payment of
interest, or reduce the amount of the principal hereof, or
reduce any premium payable on the redemption hereof, without the
consent of the registered owner hereof, or (2) reduce the aforesaid
percentage of owners of Bonds whose consent is required for the
execution of such supplemental indentures, or extend the time of
payment, or reduce the amount of any sinking fund payment or permit
the creation of any lien on the Revenues prior to or on a parity
with the lien of the Indenture, or permit the creation of any
preference of any Bond owner over any other Bond owner or deprive
the owners of the Bonds of the lien created by the Indenture upon
the Revenues, without the consent of the owners of all Bonds then
outstanding.
The Bonds are subject to mandatory redemption prior to their
stated maturity, as a whole, in the event of the occurrence of a
Determination of Taxability, as further provided in the Indenture.
Such redemption shall be made with the proceeds of a draw on the
Letter of Credit and shall be at a redemption price equal to the
principal amount of the Bonds then Outstanding together with
accrued interest thereon to the date fixed for redemption, plus
a premium of three percent (3%) of the principal amount of the
Bonds to be redeemed.
The Bonds are also subject to mandatory redemption prior to
their stated maturity, as a whole, at a redemption price equal to
the principal amount thereof plus accrued interest thereon to the
date fixed for redemption, without premium, if within thirty (30)
days of an Act of Bankruptcy of the Bank the Borrower does not
deliver to the Trustee a Substitute Letter of Credit, as further
provided in the Indenture.
The Bonds are also subject to mandatory redemption prior to
their stated maturity, as a whole, at the principal amount thereof
together with interest thereon to the date fixed for redemption,
without premium, if the Trustee shall not have received, in
accordance with the terms of the Indenture and the Loan Agreement,
an extension of the Letter of Credit or an Alternate Letter of
Credit (as defined in the Indenture) at least forty-five (45) days
prior to the expiration thereof.
The Bonds are subject to redemption prior to their stated
maturity, at the option of the Issuer, upon request by the
Borrower, as a whole, on any Payment Date, but only from Eligible
Funds and under the circumstances set forth in Section 8.02(b) of
the Agreement, at a redemption price equal to the principal amount
of Bonds to be redeemed together with accrued interest thereon to
the date fixed for redemption. In addition, Bonds are subject to
redemption on any interest payment date from excess moneys in the
Construction Fund pursuant to Section 4.01(c) of the Indenture.
The Bonds are also subject to redemption prior to their stated
maturity, at the option of the Issuer, upon request of the
Borrower, as a whole or in part by lot, on any interest payment
date, on and after February 1, 2003, but only from Eligible Funds,
at the following redemption prices (expressed in terms of total
percentages of the principal amount of Bonds to be redeemed),
together, in each case, with interest accrued to the date fixed for
redemption:
Redemption Period Redemption
(Dates Inclusive) Price
February 1, 2003 to January 31, 2004 101%
February 1, 2004 and thereafter 100%
Upon an Event of Default under the Indenture, the Agreement or
the Reimbursement Agreement, the principal of all Bonds may be
declared due and payable upon the conditions, in the manner and
with the effect provided in the Indenture. The Indenture provides
that in certain events such declaration and its consequences may be
rescinded, with the written consent of the Bank.
If the Trustee shall immediately declare the principal of all
Bonds to be due and payable following a default, it is required to
draw on the Letter of Credit for payment of the principal of and
accrued interest on the outstanding Bonds, together with a premium
equal to three percent (3%) of the principal amount of the
outstanding Bonds. The Indenture further provides that the Bonds
will cease to accrue interest as soon as the Trustee has received,
through a draw on the Letter of Credit, sufficient moneys to
immediately pay the principal of, premium, if any, and accrued
interest on all outstanding Bonds.
The Bonds are issuable as registered Bonds only, without
coupons, in denominations of $5,000 or any integral multiple
thereof.
This Bond is transferable by the registered owner hereof, in
person or by his attorney duly authorized in writing, at the
principal corporate trust office of the Trustee in Los Angeles,
California, but only in the manner, subject to the limitations and
upon payment of the charges provided in the Indenture, and upon
surrender and cancellation of this Bond. Upon such transfer a new
fully registered Bond or Bonds, of the same series and maturity
and of authorized denomination or denominations, and for the same
aggregate principal amount, will be issued to the transferee in
exchange herefor.
The Issuer and the Trustee may treat the owner hereof as the
absolute owner hereof for all purposes, and the Issuer and the
Trustee shall not be affected by any notice to the contrary.
It is hereby certified that all of the conditions, things and
acts required to exist, to have happened and to have been performed
precedent to and in the issuance of this Bond do exist, have
happened and have been performed in due time, form and manner as
required by the Constitution and statutes of the State of
California, and that the amount of this Bond, together with all
other indebtedness of the Issuer, does not exceed any limit
prescribed by the Constitution or statutes of the State of
California.
This Bond shall not be entitled to any benefit under the
Indenture, or become valid or obligatory for any purpose, until the
certificate of authentication hereon endorsed shall have been
signed by the Trustee.
IN WITNESS WHEREOF, the Industrial Development Authority of
the City of Santa Ana has caused this Bond to be executed in its
name and on its behalf by the manual or facsimile signatures of its
Executive Director and Secretary and its seal to be reproduced
hereon, all as of February 1, 1985.
INDUSTRIAL DEVELOPMENT AUTHORITY OF
THE CITY OF SANTA ANA
By:
Executive Director
[SEAL]
By:
Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the fully registered Bonds described in the
within-mentioned Indenture.
Dated: February 1, 1995 FIRST INTERSTATE BANK OF
CALIFORNIA, as Trustee
By:
Authorized Signatory
LEGAL OPINION
I hereby certify that the following is a correct copy of the
signed legal opinion of Jones Hall Hill & White, a Professional Law
Corporation, San Francisco, California, dated as of the date of
delivery of and payment of this Bond the date the Bonds referred to
therein were delivered and paid for.
Secretary of the Industrial Development Authority of the City
of Santa Ana
ASSIGNMENT
For value received the undersigned do(es) hereby sell, assign
and transfer unto (typewrite name, address and federal tax
identification number) the within-registered Bond and hereby
irrevocably constitute(s) and appoint(s)
attorney, to transfer the same on the Bond register
with full power of substitution in the premises.
Dated: _______________________
Signature Guaranteed:
Note: Signature(s) must be guaranteed by an eligible guarantor
institution with membership in an approved signature guarantee
medallion program pursuant to Securities and Exchange Commission
Rule 17A(d)15.
By:
Note: The signature(s) on this assignment must correspond with the
name(s) as written on the face of the within-registered Bond in
every particular, without alteration or enlargement or any change
whatsoever.
EXHIBIT B
FORM OF DTC LETTER OF REPRESENTATIONS