Exhibit 4.7
AMENDED AND CONSOLIDATED
LOAN CONTRACT
(No Future Advances)
Dated as of March 1, 1997
between
OGLETHORPE POWER CORPORATION
(AN ELECTRIC MEMBERSHIP GENERATION &
TRANSMISSION CORPORATION)
and
UNITED STATES OF AMERICA
RUS Project Designation:
Georgia 109 OPC
TABLE OF CONTENTS
Page
RECITALS.......................................................................1
ARTICLE I -- DEFINITIONS.......................................................2
ARTICLE II -- REPRESENTATIONS AND WARRANTIES ..................................6
ARTICLE III -- THE LOANS.......................................................8
Section 3.1 The Loans................................................8
Section 3.2 No Further Advances......................................8
Section 3.3 Interest Rates and Payment...............................8
Section 3.4 Prepayment...............................................9
ARTICLE IV -- AFFIRMATIVE COVENANTS............................................9
Section 4.1 Generally................................................9
Section 4.2 Annual Certificates......................................9
Section 4.3 Simultaneous Prepayment of Contemporaneous Loans.........9
Section 4.4 Rates and Coverage Ratios...............................10
Section 4.5 Financial Books.........................................10
Section 4.6 Rights of Inspection....................................10
Section 4.7 Real Property Acquisition...............................10
Section 4.8 Power Requirements Studies..............................11
Section 4.9 Long Range Engineering Plans and Construction
Work Plans..............................................11
Section 4.10 Design Standards, Construction Standards and List
of Materials............................................11
Section 4.11 Financial Reports.......................................11
Section 4.12 Miscellaneous Reports and Notices.......................11
Section 4.13 Variable Rate Indebtedness..............................12
Section 4.14 Special Construction Account............................12
Section 4.15 Compliance with Laws....................................13
Section 4.16 Plant Agreements........................................13
Section 4.17 Separate Accounts.......................................13
Section 4.18 Nuclear Fuel............................................13
Section 4.19 Additional Affirmative Covenants........................14
ARTICLE V -- NEGATIVE COVENANTS...............................................14
Section 5.1 General ................................................14
Section 5.2 Limitations on System Extensions, Additions
and Dispositions........................................14
Section 5.3 Limitations on Employment and Retention of
General Manager.........................................15
(i)
Section 5.4 Limitations on Certain Types of Contracts...............15
Section 5.5 Limitations on Loans, Investments and Other
Obligations.............................................17
Section 5.6 Depreciation Rates......................................17
Section 5.7 Rate Reductions.........................................17
Section 5.8 Indenture Restrictions..................................17
Section 5.9 Negative Pledge.........................................19
Section 5.10 Emissions Allowances....................................21
Section 5.11 Changes to Plant Agreements.............................21
Section 5.12 Fiscal Year.............................................21
Section 5.13 Limits on Variable Rate Indebtedness....................21
Section 5.14 Additional Negative Covenants...........................21
ARTICLE VI -- EVENTS OF DEFAULT...............................................21
ARTICLE VII -- REMEDIES.......................................................23
ARTICLE VIII -- MISCELLANEOUS.................................................23
Section 8.1 Notice to RUS; Objection of RUS .......................23
Section 8.2 Notices.................................................24
Section 8.3 Expenses................................................25
Section 8.4 Late Payments...........................................25
Section 8.5 Filing Fees.............................................25
Section 8.6 No Waiver...............................................25
Section 8.7 Governing Law...........................................25
Section 8.8 Holiday Payments........................................26
Section 8.9 Successors and Assigns..................................26
Section 8.10 Complete Agreement; Amendments..........................26
Section 8.11 Headings................................................26
Section 8.12 Severability............................................26
Section 8.13 Right of Set off........................................27
Section 8.14 Schedules and Exhibits..................................27
Section 8.15 Sole Benefit ...........................................27
Section 8.16 Existing Loan Contract..................................27
Section 8.17 Authority of RUS Representatives........................27
Section 8.18 Relation to RUS Regulations.............................28
Section 8.19 Term....................................................28
(ii)
Schedules
Schedule 1 Existing Loan Contract; Etc.
Schedule 2 Additional Covenants
Exhibit A Form of Lock Box Agreement
(iii)
AMENDED AND CONSOLIDATED LOAN CONTRACT
THIS AMENDED AND CONSOLIDATED LOAN CONTRACT, dated as of March 1, 1997, is
between OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP GENERATION &
TRANSMISSION CORPORATION) (together with any successors and assigns, the
"Borrower"), a corporation organized and existing under the laws of the State of
Georgia (the "State"), and the UNITED STATES OF AMERICA (the "Government"),
acting by and through the Administrator (together with any person succeeding to
the powers and rights of the Administrator with respect to this Agreement, the
"Administrator") of the Rural Utilities Service (together with any agency
succeeding to the powers and rights of the Rural Utilities Service with respect
to this Agreement, the "RUS");
RECITALS
WHEREAS, the Borrower has incurred, pursuant to the Act (as defined in
Article I) and under the Existing Loan Contract (as defined below), certain
indebtedness and other obligations to, or guaranteed by, the Government, acting
by and through the Administrator of the RUS, which indebtedness and other
obligations are evidenced by the Prior Notes (as defined in Article I); and
WHEREAS, in connection with the loans and other obligations evidenced by
the Prior Notes, the Borrower and the Government, acting by and through the
Administrator of the RUS, have entered into that certain Amended and
Consolidated Loan Contract, dated as of June 1, 1984, which has been
supplemented and amended by the documents identified in Schedule 1 (the
"Existing Loan Contract"); and
WHEREAS, to secure the indebtedness and other obligations evidenced by the
Prior Notes and to secure certain other indebtedness, the Borrower has entered
into that certain Consolidated Mortgage and Security Agreement, dated as of
September 1, 1994, by and among the Borrower, as mortgagee, and the Government,
acting through the Administrator of the RUS, CoBank, ACB, formerly known as
National Bank for Cooperatives, Credit Suisse First Boston, formerly known as
Credit Suisse, acting by and through its New York Branch, and SunTrust Bank,
Atlanta, formerly known as Trust Company Bank (as Trustee under certain
pollution control bond indentures), as mortgagees (together with the predecessor
instruments thereto and identified therein, collectively, the "RUS Mortgage");
and
WHEREAS, pursuant to the Second Amended and Restated Restructuring
Agreement (as it may be amended, the "Restructuring Agreement"), dated as of
February 24, 1997, by and among the Borrower, Georgia Transmission Corporation
(An Electric Membership Corporation) ("GTC") and Georgia System Operations
Corporation ("GSOC"): (i) the Borrower has transferred its transmission business
to GTC and its system operations business to GSOC; (ii) GTC has assumed, and the
Borrower has been released as to, a portion of the indebtedness and other
obligations evidenced by the Prior Notes; and (iii) the Borrower has executed
and delivered the Outstanding Notes (as defined
in Article I) to evidence that portion of the indebtedness and other liabilities
evidenced by the Prior Notes as to which it remains liable; and
WHEREAS, the Borrower, the Government, acting by and through the
Administrator of the RUS, and the other mortgagees have replaced the RUS
Mortgage with the Indenture (as defined in Article I), pursuant to which the
Borrower has granted security title to and a security interest in substantially
all of its real and personal property to secure the Outstanding Notes and the
other obligations secured under the RUS Mortgage as to which it remains liable;
and
WHEREAS, in connection with the restructuring transactions contemplated by
the Restructuring Agreement and the substitution of the Indenture as a
replacement for the RUS Mortgage, the Borrower and the Government intend to
amend and consolidate the Existing Loan Contract as herein set forth;
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter contained, the parties hereto amend and consolidate the
Existing Loan Contract to read in its entirety, and agree and bind themselves,
as follows:
ARTICLE I -- DEFINITIONS
Capitalized terms that are not defined herein shall have the meanings set
forth in the Indenture. The terms defined herein include both the plural and the
singular. Unless otherwise specifically provided, all accounting terms not
otherwise defined herein shall have the meanings assigned to them, and all
determinations and computations herein provided for shall be made, in accordance
with Accounting Requirements.
"Accounting Requirements" shall have the meaning given such term in the
Indenture.
"Act" shall mean the Rural Electrification Act of 1936, as amended.
"Agreement" shall mean this Loan Contract, together with all schedules,
and also any subsequent supplements or amendments hereto.
"Business Day" shall mean any day that the RUS and FFB are both open for
business.
"Contemporaneous Loans" shall mean those loans identified as such on
Schedule 1.
"Current Refunding" shall mean any refinancing or refunding of
indebtedness that occurs not more than ninety (90) days following the Stated
Maturity of such indebtedness.
"Equity" shall mean the Borrower's total margins and equities computed in
accordance with Accounting Requirements.
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"Event of Default" shall have the meaning as defined in Article VI.
"FERC" shall mean the Federal Energy Regulatory Commission, or any agency
or other governmental body succeeding to the functions thereof.
"FFB" shall mean the Federal Financing Bank, an instrumentality and
wholly-owned corporation of the Government, and any successor to the powers and
rights thereof with respect to the Outstanding Notes.
"Fitch" shall mean Fitch Investors Service, Inc., and any successor
thereto.
"General Manager" shall mean the President and Chief Executive Officer of
the Borrower or the person performing the duties of a chief executive officer if
no person holds such title and, in the event of any dispute between the Borrower
and the Government as to who is the General Manager, the Administrator may
designate a person or position that shall be the General Manager for purposes of
this Agreement.
"Highest Oversight Period" shall mean any period commencing on the date
the Borrower receives written notice from the Administrator that any of the
following events has occurred (which notice shall set forth the basis for
concluding that such event has occurred), and ending on the date the Borrower
receives written notice from the Administrator that such period has ended:
(i) all of the long-term indebtedness that is not subject to credit
enhancement issued by or for the benefit of the Borrower (including,
without limitation, indebtedness issued by development authorities
or any other governmental authority with respect to which the
Borrower is an obligor) and secured directly or indirectly under the
Indenture is assigned a rating of less than "Ba3" (or its then
current equivalent) in the case of Moody's, "BB-" (or its then
current equivalent) in the case of S&P, "BB-" (or its then current
equivalent) in the case of Fitch, or the then current equivalent by
any other Rating Agency;
(ii) the Administrator determines that the System is incapable of
providing reliable service to the members of the Borrower pursuant
to the terms of the Wholesale Power Contracts;
(iii) the Administrator determines that, as a consequence of any change in
the condition, financial or otherwise, operations, properties or
business of the Borrower, the Borrower will be unable to perform its
material obligations under (a) this Agreement, (b) the Wholesale
Power Contracts, (c) the Outstanding Notes, or (d) the Indenture; or
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(iv) the occurrence of an Event of Default under the Indenture, or any
event which with the passage of time or giving of notice, or both,
would constitute an Event of Default under the Indenture.
"Increased Oversight Period" shall mean any period (other than a Highest
Oversight Period) during which any of the long-term indebtedness that is not
subject to credit enhancement issued by or for the benefit of the Borrower
(including, without limitation, indebtedness issued by development authorities
or any other governmental authority with respect to which the Borrower is an
obligor) and secured directly or indirectly under the Indenture is not then
assigned investment grade ratings by at least two (2) Rating Agencies. For
purposes of this definition, an investment grade rating shall mean, in the case
of Moody's, a rating of "Baa3" or higher, in the case of S&P, a rating of "BBB-"
or higher, in the case of Fitch, a rating of "BBB-" or higher, and in the case
of any other Rating Agency, the current equivalent thereof.
"Indenture" shall mean the Indenture, dated as of March 1, 1997, entered
into by the Borrower and SunTrust Bank, Atlanta, as trustee, and all amendments
and supplements thereto.
"Investment" shall mean any loan or advance to, or any investment in, or
purchase or commitment to purchase any stock, bonds, notes or other securities
of, or guaranty, assumption or other obligation or liability with respect to the
obligations of, any other person, firm or corporation, except investments in
securities or deposits issued, guaranteed or fully insured as to payment by the
Government or any agency thereof and except any other investments set forth in
the RUS Regulations (7 C.F.R. ss. 1717.655) as excluded from computations of the
amounts and types of investments for which RUS approval is required.
"Laws" shall have the meaning as defined in Section (e) of Article II.
"Loans" shall mean the loans and other obligations described in Article
III.
"Loan Documents" shall mean this Agreement, the Indenture and the
Outstanding Notes.
"Material Adverse Effect" shall mean a material adverse effect on the
condition, financial or otherwise, operations, properties, margins or business
of the Borrower or on the ability of the Borrower to perform its obligations
under the Loan Documents.
"Moody's" shall mean Moody's Investor Service, Inc., and any successor
thereto.
"Outstanding Notes" shall mean those notes of the Borrower outstanding on
the date hereof payable to the order of FFB, the payment of which is guaranteed
by the Government pursuant to the Act, and those notes of the Borrower
outstanding on the date hereof payable to the order of the Government evidencing
loans made by the Government, acting by and through the Administrator of the
RUS, pursuant to the Act, or evidencing reimbursement obligations of the
Borrower to the Government with respect to the Government's guarantee of the
payment of certain notes payable to
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the order of FFB, all as specifically identified on Schedule 1 hereto, and all
amendments, supplements, extensions and replacements to, of or for such notes.
"Plant Agreements" shall mean those agreements relating to the joint
ownership and operation of generating facilities described on Schedule 1 hereto.
"Prior Notes" shall mean those notes of the Borrower payable to the order
of FFB, the payment of which is guaranteed by the Government pursuant to the
Act, and those notes of the Borrower payable to the order of the Government
evidencing loans made by, or evidencing reimbursement obligations of the
Borrower to, the Government, acting by and through the Administrator of the RUS,
pursuant to the Act, which have been satisfied and replaced by delivery of the
Outstanding Notes.
"Prudent Utility Practice" shall mean any of the practices, methods and
acts engaged in or approved by a significant portion of the electric utility
industry in the region during the relevant time period, or any of the practices,
methods and acts that, in the exercise of reasonable judgment in light of the
facts known at the time the decision was made, could have been expected to
accomplish the desired result at lowest reasonable cost consistent with good
business practices, reliability, safety and expedition. "Prudent Utility
Practice" is not intended to be limited to the optimum practice, method or act,
to the exclusion of all others, but rather to include a spectrum of possible
practices, methods or acts generally in acceptance in the region in light of the
circumstances.
"Rates" shall have the meaning given such term in the Indenture.
"Rating Agency" shall mean any nationally recognized statistical rating
organization (within the meaning of the rules of the United States Securities
and Exchange Commission) that at the applicable time has assigned, at the
request of the Borrower, a rating to any long-term indebtedness (that is not
subject to credit enhancement) issued by or on behalf of the Borrower
(including, without limitation, indebtedness issued by development authorities
or any other governmental authority with respect to which the Borrower is an
obligor) and secured directly or indirectly under the Indenture.
"RUS Regulations" shall mean the rules and regulations of general
applicability published by the RUS from time to time in 7 C.F.R. Chapter XVII
and any replacement chapter, as such rules and regulations exist at the date of
applicability thereof, and, unless the context clearly demonstrates a contrary
intent, shall also include such rules and regulations of other Federal entities
which the RUS is required by law to implement.
"S&P" shall mean Standard & Poor's Rating Service, A Division of The
McGraw-Hill Companies, Inc., and any successor thereto.
"Special Construction Account" shall have the meaning as defined in
Section 4.14.
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"Subsidiary" shall mean a corporation that is a subsidiary of the Borrower
and subject to the Borrower's control, as defined by Accounting Requirements.
"System" shall mean all electric properties and interest in electric
properties of the Borrower, it being the intent that "System" be broadly
construed to encompass and include the Borrower's interests in all electric
production, transmission, distribution, conservation, load management, general
plant and other related facilities, equipment or property and in any mine, well,
pipeline, plant, structure or other facility for the development, production,
manufacture, storage, fabrication or processing of fossil, nuclear or other fuel
of any kind or in any facility or rights with respect to the supply of water, in
each case for use, in whole or in major part, in any of the Borrower's
generating plants, now existing or hereafter acquired by lease, contract,
purchase or otherwise or constructed by the Borrower, including any interest or
participation of the Borrower in any such facilities or any rights to the output
or capacity thereof, together with all additions, betterments, extensions and
improvements to said System or any part thereof hereafter made and together with
all lands, easements and rights-of-way of the Borrower and all other works,
property or structures of the Borrower and contract rights and other tangible
and intangible assets of the Borrower used or useful in connection with or
related to said System, including, without limitation, a contract right or other
contractual arrangement for the long-term or short-term interconnection,
interchange, exchange, pooling, wheeling, transmission, purchase or sale of
electric power and energy and other similar arrangements with entities having
generation or transmission capabilities; provided, however, that "System" shall
not include any property constituting Excepted Property or Excludable Property.
"Total Utility Plant" shall mean the amount constituting the total utility
plant (gross) of the Borrower computed in accordance with Accounting
Requirements.
"Wholesale Power Contracts" shall mean the Amended and Restated Wholesale
Power Contracts, each dated as of August 1, 1996, by and between the Borrower
and its members, and all amendments, supplements or replacements thereto or
thereof.
ARTICLE II -- REPRESENTATIONS AND WARRANTIES
Recognizing that the RUS is relying hereon, the Borrower represents and
warrants, as of the date of this Agreement, as follows:
(a) Organization; Power, Etc. The Borrower: (i) is duly organized, validly
existing, and in good standing under the laws of the State; (ii) is duly
qualified to do business and is in good standing in each jurisdiction in which
the transaction of its business makes such qualification necessary; (iii) has
all requisite corporate and legal power to own and operate its assets and to
carry on its business and to enter into and perform the Loan Documents; and (iv)
has duly and lawfully obtained and maintained all material licenses,
certificates, permits, authorizations and approvals which are necessary to the
conduct of its business or required by applicable Laws.
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(b) Authority. The execution, delivery and performance by the Borrower of
this Agreement and the other Loan Documents and the performance of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate action and do not violate any provision of law or of the
Articles of Incorporation or By-Laws of the Borrower or result in a breach of,
or constitute a default under, any agreement, indenture or other instrument to
which the Borrower is a party or by which it may be bound.
(c) Consents. No consent, permission, authorization, order or license of
any governmental authority is necessary in connection with the execution,
delivery or performance of the Loan Documents, except such as have been obtained
and are in full force and effect.
(d) Binding Agreement. Each of the Loan Documents is, or when executed and
delivered will be, the legal, valid, and binding obligation of the Borrower,
enforceable in accordance with its terms, subject only to limitations on
enforceability imposed in equity or by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally.
(e) Compliance With Laws. The Borrower is in compliance in all material
respects with all federal, state and local laws, rules, regulations, ordinances,
codes and orders (collectively, "Laws"), the failure to comply with which could
reasonably be expected to have a Material Adverse Effect.
(f) Litigation. There are no pending legal, arbitration or governmental
actions or proceedings to which the Borrower is a party or to which any of its
property is subject which, if adversely determined, could reasonably be expected
to have a Material Adverse Effect, and to the best of the Borrower's knowledge,
no such actions or proceedings are threatened or contemplated, except as the
Borrower has disclosed to the RUS in writing.
(g) Financial Statements; No Material Adverse Change; Etc. The financial
statements of the Borrower as of December 31, 1996, and for the year then ended,
present fairly, in all material respects, the financial position of the Borrower
and the results of its operations in conformity with Accounting Requirements.
Since December 31, 1996, there has been no material adverse change in the
financial condition or operations of the Borrower.
(h) Budgets; Projections; Etc. All budgets, projections, appraisals,
feasibility studies and other financial information submitted by the Borrower to
the RUS or to any Rating Agency, as updated by the Borrower from time to time
and submitted to the RUS and to the Rating Agencies, in connection with the
restructuring transactions contemplated by the Restructuring Agreement were
reasonable at the time so submitted; and, as of the date hereof, no fact has
come to light, and no event or transaction has occurred, which would cause such
information, as so updated, to be unreasonable.
(i) Location of Properties. All real property and interests therein of the
Borrower located in the State is located in the counties identified in the
Indenture.
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(j) Principal Place of Business; Records. The principal place of business
and chief executive office of the Borrower is at the address of the Borrower
specified in Section 8.2.
(k) Subsidiaries. The Borrower has no Subsidiary, except as the Borrower
has disclosed to the RUS in writing.
(l) Defaults Under Other Agreements. The Borrower is not in default under
any agreement or instrument to which it is a party or to which any of its
property is subject that could reasonably be expected to have a Material Adverse
Effect.
ARTICLE III -- THE LOANS
Section 3.1 The Loans
To finance, pursuant to the provisions of the Act, the construction and
operation of the System for the purpose of furnishing electric energy to persons
in rural areas not receiving central station electric service, (i) the Borrower
has borrowed funds from the Government, acting by and through the Administrator
of the RUS, evidenced by the Outstanding Notes payable to the Government, (ii)
the Borrower has borrowed funds from FFB, evidenced by the Outstanding Notes
payable to FFB, and the Government, acting by and through the Administrator of
the RUS, has guaranteed the repayment of such funds, and (iii) the Borrower has
agreed to reimburse the Government, acting by and through the Administrator of
the RUS, for amounts paid by the Government on account of its guarantee of funds
borrowed by the Borrower from FFB, which reimbursement obligations are evidenced
by the Outstanding Notes payable to the Government in respect of such
reimbursement obligations.
Section 3.2 No Further Advances
The Borrower acknowledges and agrees that all amounts to be advanced to
the Borrower under the Outstanding Notes have been advanced and neither FFB nor
the Government, acting by or through the Administrator of the RUS, is under any
obligation to make any further advances to the Borrower under the Outstanding
Notes (other than with respect to payments by the Government on account of its
guarantees of certain Outstanding Notes payable to FFB).
Section 3.3 Interest Rates and Payment
(a) Interest Rates. The Outstanding Notes shall be payable and bear
interest as therein provided.
(b) Application of Payments. All payments which the Borrower sends to the
RUS on any Outstanding Note shall be applied in the manner provided in the Loan
Documents to which such
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payments relate and in a manner consistent with RUS policies, practices and
procedures for obligations that have been similarly classified by the RUS.
(c) Electronic Funds Transfer. Except as otherwise prescribed by the RUS,
the Borrower shall make all payments on the Outstanding Notes utilizing
electronic funds transfer procedures as specified by the RUS.
Section 3.4 Prepayment
The Borrower has no right to prepay any Outstanding Note in whole or in
part except such rights, if any, as are expressly provided for in each
Outstanding Note or as may be provided by Law. However, prepayment of any
Outstanding Note (and any penalties) relating to a Contemporaneous Loan shall be
mandatory under Section 4.3.
ARTICLE IV -- AFFIRMATIVE COVENANTS
Section 4.1 Generally
Unless otherwise agreed to in writing by the RUS, while this Agreement is
in effect, the Borrower shall duly observe each of the affirmative covenants
contained in this Article IV.
Section 4.2 Annual Certificates
(a) Performance under Indenture. The Borrower shall duly observe and
perform all of its obligations under the Indenture.
(b) Annual Certification. Within one hundred twenty (120) days after the
close of each fiscal year, the Borrower shall deliver to the RUS a written
statement signed by its General Manager, stating that, to the knowledge of the
General Manager, during such year the Borrower has fulfilled all of its
obligations under the Loan Documents throughout such year in all material
respects or, if there has been a material default in the fulfillment of any such
obligations, specifying each such default known to the General Manager and the
nature and status thereof.
Section 4.3 Simultaneous Prepayment of Contemporaneous Loans
If the Borrower shall at any time prepay in whole or in part any
Contemporaneous Loan, the Borrower shall prepay the related Outstanding Note to
the Government in the ratio that the unpaid principal balance of such
Outstanding Note to the Government bears to the aggregate unpaid principal
amount of both such Outstanding Note and the Outstanding Note evidencing the
Contemporaneous Loan. If either such Outstanding Note calls for a prepayment
penalty or premium, such amount shall be paid but shall not be used in computing
the amount needed to be paid to the Government under this Section 4.3 to
maintain such ratio. Prepayments associated with refinancing
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or refunding a Contemporaneous Loan are not considered to be prepayments for
purposes of this Agreement if (i) the principal amount of such refinancing or
refunding loan is not less than the amount of loan principal being refinanced
and (ii) the weighted average life of the refinancing or refunding loan is not
less than the weighted average remaining life of the loan being refinanced.
Section 4.4 Rates and Coverage Ratios
(a) Prospective Notice of Change in Rates. The Borrower shall give the RUS
sixty (60) days' prior written notice of any proposed change in the Borrower's
general rate structure.
(b) Routine Reporting Coverage Ratios. In connection with the furnishing
of its annual report to the RUS pursuant to Section 4.11, the Borrower shall
report to the RUS, in such written format as RUS may require, the Margins for
Interest level which was achieved during such fiscal year.
(c) Corrective Plans. Within thirty (30) days of (i) sending a notice to
the RUS under subsection (b) above that shows the Margins for Interest level
required by Section 13.14 of the Indenture was not met for any fiscal year, or
(ii) being notified by the RUS that the Margins for Interest level required by
Section 13.14 of the Indenture was not met for any fiscal year, whichever is
earlier, the Borrower in consultation with the RUS shall provide a written plan
satisfactory to the RUS setting forth the actions that shall be taken to achieve
the required Margins for Interest level on a timely basis.
Section 4.5 Financial Books
The Borrower shall at all times keep, and safely preserve, proper books,
records and accounts in which full and true entries shall be made of all of the
dealings, business and affairs of the Borrower and its Subsidiaries, in
accordance with any applicable Accounting Requirements.
Section 4.6 Rights of Inspection
The Borrower shall afford the RUS, through its representatives, reasonable
opportunity, at all times during business hours and upon prior notice, to have
access to and the right to inspect the System, any other property encumbered by
the Indenture, and any or all books, records, accounts, invoices, contracts,
leases, payrolls, canceled checks, statements and other documents and papers of
every kind belonging to or in the possession of the Borrower or in any way
pertaining to its property or business, including its Subsidiaries, if any, and
to make copies or extracts therefrom.
Section 4.7 Real Property Acquisition
In acquiring real property, the Borrower shall comply in all material
respects with the provisions of the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of
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1970, as amended by the Uniform Relocation Act Amendments of 1987, and 49 C.F.R.
part 24, referenced by 7 C.F.R. part 21, to the extent applicable to such
acquisition.
Section 4.8 Power Requirements Studies
The Borrower shall prepare and use power requirements studies of its
electric loads and future energy and capacity requirements in conformance with
Prudent Utility Practice and an RUS approved plan for preparation of such power
requirements studies, taking into account the limited obligation of the Borrower
under the Wholesale Power Contracts; provided, however, that during a Highest
Oversight Period, the Borrower shall prepare and use such studies in conformance
with RUS Regulations. The Borrower shall provide the RUS with copies of such
studies.
Section 4.9 Long Range Engineering Plans and Construction Work Plans
The Borrower shall develop, maintain and use up-to-date long-range
engineering plans and construction work plans in conformance with Prudent
Utility Practice; provided, however, that during a Highest Oversight Period, the
Borrower shall develop, maintain and use such plans in conformance with RUS
Regulations.
Section 4.10 Design Standards, Construction Standards and List of Materials
The Borrower shall use design standards, construction standards and lists
of acceptable materials in conformance with Prudent Utility Practice; provided,
however, that during a Highest Oversight Period, the Borrower shall use such
standards and lists in conformance with RUS Regulations.
Section 4.11 Financial Reports
The Borrower shall cause to be prepared and furnished to the RUS a full
and complete annual report of its financial condition and of its operations in
form and substance satisfactory to the RUS, audited and certified by an
independent certified public accountant satisfactory to the RUS and accompanied
by a report of such audit in form and substance reasonably satisfactory to the
RUS. The Borrower shall also furnish to the RUS from time to time such other
reports concerning the financial condition or operations of the Borrower,
including its Subsidiaries, as the RUS may reasonably request or RUS Regulations
require.
Section 4.12 Miscellaneous Reports and Notices
The Borrower shall furnish to the RUS:
(a) Notice of Default. Promptly after becoming aware thereof, notice of:
(i) the occurrence of any Event of Default or event which with the giving of
notice or the passage of time, or both, would become an Event of Default; and
(ii) the receipt of any notice given pursuant to the
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Indenture with respect to the occurrence of any event which with the giving of
notice or the passage of time, or both, could become an "Event of Default" under
the Indenture.
(b) Notice of Litigation. Promptly after the commencement thereof, notice
of the commencement of all actions, suits or proceedings before any court,
arbitrator, or governmental department, commission, board, bureau, agency or
instrumentality affecting the Borrower which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect.
(c) Notice of Change of Place of Business. Promptly in writing, notice of
any change in location of its principal place of business or the office where
its records concerning accounts and contract rights are kept.
(d) Regulatory and Other Notices. Promptly after receipt thereof, copies
of any notices or other communications received from any governmental authority
with respect to any matter or proceeding which could reasonably be expected to
have a Material Adverse Effect.
(e) Ratings. Promptly after receipt thereof, copies of any reports or
ratings on the Borrower issued by any Rating Agency.
(f) Other Information. Such other information regarding the condition,
financial or otherwise, operations, properties or business of the Borrower as
the RUS may, from time to time, reasonably request.
Section 4.13 Variable Rate Indebtedness
In connection with the furnishing of its annual report to the RUS pursuant
to Section 4.11, the Borrower shall report to the RUS, in such written format as
may be acceptable to the RUS, the specific maturities of all of the Borrower's
outstanding indebtedness and the interest rates applicable thereto, including,
without limitation, with respect to any indebtedness not bearing a fixed rate
through the maturity of such indebtedness the method and timing for adjustment
and readjustment of the applicable interest rate.
Section 4.14 Special Construction Account
The Borrower shall continue to maintain the "Special Construction Account"
maintained under the Existing Loan Contract and continue to hold therein all
moneys currently held therein, subject to this Section 4.14. The Borrower shall
withdraw moneys from the Special Construction Account only as permitted from
time to time by the RUS. Moneys in the Special Construction Account are held in
trust for the RUS. The Special Construction Account shall be insured to the
extent insurable by the Federal Deposit Insurance Corporation or other federal
agency acceptable to the RUS and shall be designated by the corporate name of
the Borrower followed by the words "Trustee, Special Construction Account." The
Borrower shall close the Special Construction Account when all moneys therein
have been withdrawn in accordance with this Section 4.14.
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Section 4.15 Compliance with Laws
The Borrower shall operate and maintain the System and its properties in
compliance in all material respects with all applicable Laws the failure to
comply with which could reasonably be expected to have a Material Adverse
Effect.
Section 4.16 Plant Agreements
(a) Enforcement. If the RUS, in its absolute discretion, shall determine
it appropriate or necessary to preserve the security for the Loans, subject to
the provisions of the Indenture, the RUS may require in writing the Borrower to
authorize and empower the Government to enforce any Plant Agreement, with the
form of such written authorization to be prescribed by the RUS.
(b) Appointment of Agent. If the appointment of Georgia Power Company as
agent under any Plant Agreement is terminated in whole or in part, and if the
Borrower is not qualified to serve as agent, then the RUS may require the
Borrower to take all action that the Borrower is entitled to take to cause the
appointment of the Government or such agency of the Government as the RUS shall
designate in writing, as agent under any such Plant Agreement, to the extent and
with such duties, rights, power and authority as the RUS shall prescribe in
writing, not inconsistent with the provisions of such Plant Agreement.
Section 4.17 Separate Accounts
The Borrower shall execute and deliver, with a financial institution
approved by the RUS, a lockbox agreement or agreements substantially in the form
of Exhibit A attached hereto ("Lockbox Agreement") and shall at all times
maintain a Lockbox Agreement in full force and effect, except as the RUS may
otherwise permit. During a Highest Oversight Period, the Borrower shall, if so
directed in writing by the RUS, (a) deposit, pursuant to a Lockbox Agreement,
all cash proceeds of the Trust Estate, including, without limitation, checks,
money and the like (other than cash proceeds deposited or required to be
deposited with the Trustee pursuant to the Indenture), which cash proceeds shall
include, without limitation, all payments by members of the Borrower on account
of the Wholesale Power Contracts, in separate deposit or other accounts,
segregated from all other monies, revenues and investments of the Borrower, and
(b) take all such other actions as the RUS shall request to continue perfection
of the lien of the Indenture in such proceeds for the benefit of all Holders of
the Outstanding Secured Obligations.
Section 4.18 Nuclear Fuel
Upon the written request of the RUS, to the extent the Borrower owns
nuclear fuel located outside the State of Georgia as to which a security
interest can be created under the Uniform Commercial Code and perfected solely
by the filing of a financing statement under the Uniform Commercial Code, the
Borrower shall cause such nuclear fuel to be subjected to the lien of the
Indenture.
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Section 4.19 Additional Affirmative Covenants
The Borrower also shall comply with the additional covenants identified in
Schedule 2 hereto.
ARTICLE V -- NEGATIVE COVENANTS
Section 5.1 General
Unless otherwise agreed to in writing by the RUS, while this Agreement is
in effect, the Borrower shall duly observe each of the negative covenants set
forth in this Article V.
Section 5.2 Limitations on System Extensions, Additions and Dispositions
(a) Additions to Capacity. The Borrower shall not, without first complying
with the requirements of Section 8.1, purchase, construct, lease or otherwise
acquire Special Assets (as defined below) if the aggregate amount expended for
purchase, construction, lease or other acquisition of all Special Assets (i) in
the current fiscal year of the Borrower is greater than 5% of the Borrower's
Total Utility Plant or (ii) in the current and two immediately preceding fiscal
years of the Borrower is greater than 10% of the Borrower's Total Utility Plant.
For the purposes of this Subsection (a), "Special Assets" means capital assets
(other than capital assets acquired with at least 85% of the acquisition cost
paid from the proceeds of "Non-Recourse Obligations" (as defined in the
Wholesale Power Contracts)) that constitute utility or non-utility plant and
that: (1) taking into account any substantially contemporaneous or otherwise
related sale, transfer, lease or other disposition, increase the generating
capacity of the System or any generating plant of the Borrower by more than 5%;
(2) are not subject to the lien of the Indenture and are not nuclear fuel; or
(3) are not used or useful as a part of the System.
(b) Dispositions of System Assets. The Borrower shall not, without first
complying with the requirements of Section 8.1, request the release of capital
assets that constitute utility plant from the lien of the Indenture pursuant to
Section 5.2 of the Indenture if (taking into account any substantially
contemporaneous or otherwise related purchase, construction, lease or other
acquisition of similar property that is subject to the lien of the Indenture)
there will result a decrease in the generating capacity of the System or any
generating plant by more than 5% if the aggregate net book value of all such
assets released from the lien of the Indenture (i) in the current fiscal year of
the Borrower is greater than 5% of the Borrower's Total Utility Plant or (ii) in
the current and two immediately preceding fiscal years of the Borrower is
greater than 10% of the Borrower's Total Utility Plant.
(c) Legal Requirements. The requirements of this Section 5.2 shall not
apply to any purchase, construction, lease or other acquisition, or any sale,
transfer, lease or other disposition, of
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capital assets to the extent that any of the foregoing is required to comply
with "Legal Requirements" (as defined in the Wholesale Power Contract). No such
purchase, construction, lease or other acquisition and no such sale, transfer,
lease or other disposition shall be considered in calculating the aggregate
limitations specified in Subsections (a) or (b) hereof.
(d) Highest Oversight Period. During a Highest Oversight Period, the
Borrower shall not, without the prior written approval of the RUS, purchase,
construct, lease or otherwise acquire, or sell, transfer, lease or otherwise
dispose, of any capital asset, or enter into any agreement therefor.
Section 5.3 Limitations on Employment and Retention of General Manager
At any time an Event of Default, or an event which with the passage of
time or the giving of notice, or both, would become an Event of Default, occurs
and is continuing, the Borrower shall not, without the prior written approval of
the RUS, enter into an employment relationship with any person to serve as
General Manager unless such employment shall first have been approved by the
RUS. If an Event of Default, or an event which with the passage of time or the
giving of notice, or both, would become an Event of Default, occurs and is
continuing and the RUS requests the Borrower to terminate the employment of its
General Manager, the Borrower shall do so within thirty (30) days after the date
of such request. All contracts in respect of the employment of the General
Manager hereafter entered into shall contain provisions to permit compliance
with this Section 5.3.
Section 5.4 Limitations on Certain Types of Contracts
(a) Approval of Certain Contracts. The Borrower shall not, without first
complying with the requirements of Section 8.1, enter into any of the following:
(i) any contract for the management or operation of all or
substantially all of the System;
(ii) any contract for the purchase or sale of electric power and
energy that has a term exceeding three (3) years and under
which committed purchases or sales exceed ten percent (10%) of
the peak demand of the System for the most recently completed
fiscal year;
(iii) any pooling or similar power supply agreement that has a term
exceeding three (3) years; or
(iv) any amendment or modification to any of the Wholesale Power
Contracts, including the Schedules thereto, except that the
Borrower may amend or modify any of (A) Exhibits 1 and 2 to
"Rate Schedule A" thereto; (B) the Exhibits to Appendix 1 to
"Rate Schedule A" thereto in the manner expressly provided in
the Wholesale Power Contracts; (C) Sections I and II of
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Appendix 3 (Control Area Services) to "Rate Schedule A"
thereto; (D) Appendix 4 (General Terms and Conditions) to
"Rate Schedule A" thereto; (E) Schedule B - Planning and
Management of Power Supply Resources for Members in the manner
expressly provided in Section 13.3.1 of the Wholesale Power
Contracts; and (F) the Wholesale Power Contracts in the manner
expressly provided in any "Withdrawal Agreement" (as defined
in the Wholesale Power Contracts) entered into in connection
with such Wholesale Power Contracts.
(b) Terminations. The Borrower shall not, without first complying with the
requirements of Section 8.1, exercise any option to terminate any contract,
including, without limitation, any Wholesale Power Contract, if such contract,
based upon its nature, remaining term (not taking into account any option of the
Borrower to terminate) and size, would be required to be approved by the RUS
pursuant to Subsection (a) above if the Borrower were to have entered into such
contract on the proposed termination date. The Borrower further agrees at the
written direction of the RUS to exercise any option to terminate a contract if
the exercise by the Borrower of that option would require compliance with
Section 8.1 pursuant to the immediately preceding sentence; provided, however,
the Borrower shall not be required to exercise any such option to terminate if
such exercise could reasonably be expected to have a Material Adverse Effect.
For the purpose of illustration only, and not by way of limitation, the Borrower
shall be required to comply with Section 8.1 before terminating, and the RUS can
require the Borrower to terminate, in any year before year seven (7) thereof, a
ten (10) year contract for the sale of electric power and energy that exceeds
ten percent (10%) of the Borrower's peak demand because the portion of the
contract to be terminated meets the standards of Subsection (a)(ii) above (i.e.,
a term greater than three (3) years for the committed sale of electric power and
energy that exceeds ten percent (10%) of the Borrower's peak demand). The
Borrower can terminate without first complying with Section 8.1, and the RUS
cannot require the Borrower to terminate, that same contract after year seven
(7) thereof.
(c) Highest Oversight Period. During a Highest Oversight Period, the
Borrower shall not, without the prior written approval of the RUS, enter into or
amend or modify any of the contracts of the type described in this Section 5.4,
regardless of duration or size.
(d) Determination of Term. The term of any contract shall be determined
for purposes of this Section 5.4 based solely upon the period prior to the first
date upon which the Borrower could, at its option, terminate the contract
(taking into account any notice period required for termination), unless the
exercise of such termination right could reasonably be expected to have a
Material Adverse Effect.
(e) Amendments; Extensions. Any amendment or modification to an existing
contract (including an extension thereof) shall be governed by this Section 5.4
only to the extent of the specific amendment or modification and not the
contract as a whole.
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Section 5.5 Limitations on Loans, Investments and Other Obligations
The Borrower shall not, without first complying with the requirements of
Section 8.1, make any Investment, except (i) Investments made for the purpose of
funds management that are made pursuant to an investment policy approved by the
Borrower's Board of Directors, a copy of which has been provided to the RUS,
(ii) Investments specifically approved by the RUS in writing under this clause
(ii), and (iii) other Investments that do not in the aggregate with all other
Investments other than Investments described in clauses (i) and (ii) above
exceed fifteen percent (15%) of the Borrower's Total Utility Plant; provided,
however, that during an Increased Oversight Period, the Borrower shall not,
without the prior written approval of the RUS, make any additional Investments,
except as permitted by the Act and the RUS Regulations; provided, further,
however, that during a Highest Oversight Period, the Borrower shall not, without
the prior written approval of the RUS, make any additional Investments of any
kind.
Section 5.6 Depreciation Rates
The Borrower shall not, without first complying with the requirements of
Section 8.1, adopt any depreciation rate not previously approved for the
Borrower by the RUS.
Section 5.7 Rate Reductions
The Borrower shall not, without first complying with the requirements of
Section 8.1, decrease its Rates if it has failed to comply with the provisions
of Section 13.14 of the Indenture for the fiscal year prior to such reduction.
Section 5.8 Indenture Restrictions
Notwithstanding the provisions of the Indenture, the Borrower shall not,
without first complying with the requirements of Section 8.1:
(i) issue Additional Obligations under the Indenture on the basis of the
$200,000,000 carry forward amount described in Section 4.2B(1) of
the Indenture, unless the proceeds of such Additional Obligations
are used (a) to pay premiums and other penalties and charges in
respect of any Existing Obligation held by FFB or the RUS, (b) to
fund the acquisition or construction of additions or extensions to
the System that are subject to the lien of the Indenture, or (c) to
pay premiums and other penalties, charges and other costs of
issuance incurred in connection with a Current Refunding in an
aggregate amount not to exceed five percent (5%) of the principal
amount of the Obligations subject to the Current Refunding;
(ii) issue Additional Obligations under the Indenture while any amounts
are outstanding under any RUS Reimbursement Obligation or during an
Increased Oversight Period or a Highest Oversight Period;
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(iii) except in connection with a Current Refunding, certify pursuant to
Section 4.3D(1) of the Indenture any retired Obligation or any
principal payment on an Obligation as the basis for taking any
action under the Indenture, if such retirement or payment is
pursuant to a regularly scheduled sinking fund or principal
installment or made at the Stated Maturity of such Obligation;
(iv) consolidate or merge with any other corporation or convey or
transfer the Trust Estate under the Indenture substantially as an
entirety unless the aggregate amount of the Borrower's Equity is not
reduced as a result of such transaction and the Borrower provides
the RUS with evidence reasonably satisfactory to the RUS that the
consummation of such transaction will not result in the commencement
of an Increased Oversight Period; provided, however, that during an
Increased Oversight Period or a Highest Oversight Period, the
Borrower shall not consolidate or merge with any corporation or
convey or transfer the Trust Estate substantially as an entirety;
(v) elect pursuant to Section 1.1D of the Indenture to apply Accounting
Requirements in effect as of the date of execution and delivery of
the Indenture;
(vi) include as Property Additions, under any provision of the Indenture,
any property that would not qualify as Property Additions but for
paragraph C of the definition of Property Additions, or sell, lease
or sublease any portion of the Trust Estate pursuant to paragraph H
of Section 5.1 of the Indenture;
(vii) submit an Available Margins Certificate under Article IV of the
Indenture for the purpose of issuing Additional Obligations unless
such Certificate is accompanied by an Independent Accountant's
Certificate stating in substance that nothing came to the attention
of such Accountant in connection with its unaudited review of such
period that would lead such Accountant to believe that there was any
incorrect or inaccurate statement in such Certificate;
(viii) enter into a Supplemental Indenture pursuant to Section 12.1H of
the Indenture;
(ix) enter into a Supplemental Indenture pursuant to Section 12.1B or
12.1C of the Indenture if (a) the Holders of the Obligations issued
under such Supplemental Indenture are granted greater security
rights in and to the Trust Estate than those security rights enjoyed
by the Government in its capacity as a Holder of Obligations under
the Indenture, provided, however, that neither (I) the existence of
Credit Enhancement nor (II) the creation and maintenance of debt
service or similar funds for the payment of the principal and
interest on Obligations issued under such Supplemental Indenture (to
the extent such debt service or other similar funds are funded from
the proceeds of the issuance of such Obligations or funded in
connection with the refinancing of other debt by such Obligations),
shall constitute greater
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security rights in and to the Trust Estate requiring the Borrower to
comply with Section 8.1; (b) the Supplemental Indenture provides for
covenants, restrictions, limitations, conditions, events of defaults
or remedies not applicable to all Obligations then Outstanding or
not equally available to all Holders of Obligations then
Outstanding, provided, however, that provisions for covenants and
events of default that relate solely to assuring that the interest
on such Obligations (or other indebtedness secured by such
Obligations) is excludable from the gross income of the holder
thereof pursuant to the Internal Revenue Code, as amended, shall not
constitute the providing of covenants or events of default requiring
the Borrower to comply with Section 8.1; or (c) the Obligations
issued under such Supplemental Indenture, or the indebtedness
secured by such Obligations, can be accelerated, or effectively
accelerated through a mandatory purchase or similar mechanism, as a
consequence of a breach or default by the Borrower under the related
loan agreement or similar agreement entered into in connection with
such Obligation or indebtedness, provided, however, that
acceleration and similar rights may be granted to development
authorities and trustees without first complying with Section 8.1 in
connection with the issuance of Obligations (or other indebtedness
secured by such Obligations) the interest on which is excludable
from the gross income of the holder thereof pursuant to the Internal
Revenue Code, as amended, if such acceleration and similar rights
are substantially similar to those currently granted to development
authorities and trustees in connection with the Existing
Obligations;
(x) create or incur or suffer or permit to be created or incurred or to
exist any pledge of current assets secured under the Indenture to
secure current liabilities; or
(xi) provide any Certificate of an Appraiser under the Indenture, unless
such Appraiser is Independent, if the amount of the property or
securities as to which the Appraiser's Certificate applies is
greater than $25,000; provide any Certificate of an Engineer under
the Indenture, unless such Engineer is a licensed professional, if
the amount of the property as to which the Engineer's Certificate
applies is greater than $100,000; or provide any Certificate of an
Engineer under the Indenture, unless such Engineer is Independent,
if the amount of the property as to which the Engineer's Certificate
applies is greater than $10,000,000.
Section 5.9 Negative Pledge
The Borrower shall not, without first complying with the requirements of
Section 8.1, directly or indirectly create, incur, assume or permit to exist any
lien, mortgage, pledge, security interest, charge or encumbrance of any kind,
whether voluntary or involuntary (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and any other agreement to
give any security interest) on or with respect to any of the Excepted Property
(other than the Excepted Property described in paragraph P of the definition of
Excepted Property, which property shall not be subject to this Section 5.9)
except for:
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(i) Permitted Exceptions (other than the Permitted Exception described
in paragraph Y of the definition of Permitted Exceptions);
(ii) as to the Excepted Property described in paragraphs B through E,
inclusive, and paragraph K of the definition of Excepted Property,
liens, mortgages, pledges, security interests, charges and
encumbrances in connection with purchase money, construction or
acquisition indebtedness (or renewals or extensions thereof) that
encumber only the asset or assets so purchased, constructed or
acquired or property improved through such purchase, construction or
acquisition, and the proceeds upon a sale, transfer or exchange
thereof;
(iii) liens, mortgages, pledges, security interests, charges and
encumbrances (a) for the benefit of all Holders of the Obligations
issued under the Indenture, (b) in connection with any bond or
similar fund established by the Borrower with respect to any debt
securities, the interest on which is excludable from gross income of
the holder thereof pursuant to the Internal Revenue Code, as
amended, to the extent of amounts deposited in such funds in the
ordinary course to make regularly scheduled payments on such debt
securities, or (c) in connection with any debt service or similar
fund established by the Borrower for the payment of principal or
interest on debt securities, the interest on which is excludable
from gross income of the holder thereof pursuant to the Internal
Revenue Code, as amended, if such fund is funded solely from the
proceeds of the issuance of such debt securities (or funded in
connection with the refinancing of other debt by such debt
securities);
(iv) liens, pledges, security interests, charges and encumbrances with
respect to any interest, debt or equity, of the Borrower in the
National Rural Utilities Cooperative Finance Corporation or CoBank,
ACB purchased or otherwise acquired by the Borrower in connection
with membership in any such entity or any borrowing from any such
entity;
(v) liens, pledges, security interests, charges and encumbrances arising
in connection with any legal or economic defeasance of indebtedness,
unless the funding of the defeasance is during an Increased
Oversight Period or a Highest Oversight Period and more than 20% of
the defeasance is funded other than with the proceeds of the
issuance of new indebtedness (in which case the Borrower shall first
comply with the requirements of Section 8.1 before permitting or
creating any such lien, pledge, security interest, charge or
encumbrance); or
(vi) liens, pledges, security interests, charges and encumbrances with
respect to deposit, brokerage, commodity and other similar accounts
to the extent such liens, pledges, security interests, charges and
encumbrances do not secure indebtedness for borrowed money other
than indebtedness incurred in connection with acquiring securities
or other investments deposited in any such account.
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Section 5.10 Emissions Allowances
The Borrower shall not, without first complying with the requirements of
Section 8.1, sell, assign or otherwise dispose of (or enter into any agreement
therefor) any allowances for emissions or similar rights granted by any
governmental authority, except allowances or similar rights that exceed those
necessary in any particular calendar year for the Borrower to operate its
generating facilities during such year, as evidenced by a written certification
by the Borrower and provided to the RUS at the time of such sale, assignment or
other disposition.
Section 5.11 Changes to Plant Agreements
The Borrower shall not, without first complying with the requirements of
Section 8.1, amend, supplement, waive, extend, terminate or assign the Plant
Agreements or agree to do so.
Section 5.12 Fiscal Year
The Borrower shall not, without first complying with the requirements of
Section 8.1, change its fiscal year.
Section 5.13 Limits on Variable Rate Indebtedness
During an Increased Oversight Period or a Highest Oversight Period, the
Borrower shall not, if so directed in writing by the RUS, increase the
outstanding principal amount of indebtedness of the Borrower, the interest rate
with respect to which is adjusted or readjusted at intervals of less than two
(2) years, including, without limitation, Additional Obligations issued as a
Periodic Offering the interest rate on which is subject to such adjustment or
readjustment, to an amount exceeding the amount thereof outstanding on the date
of such notice from the RUS.
Section 5.14 Additional Negative Covenants
The Borrower also shall comply with the additional negative covenants
identified in Schedule 2 hereto.
ARTICLE VI -- EVENTS OF DEFAULT
The following shall be "Events of Default" under this Agreement:
(a) Representations and Warranties. Any representation or warranty made by
the Borrower in Article II hereof, in any certificate furnished to the RUS
hereunder or in the Indenture shall be incorrect in any material respect at the
time made;
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(b) Payment. Default shall be made in the payment of or on account of
interest on or principal of any Outstanding Note when and as the same shall be
due and payable, whether by acceleration or otherwise, which shall remain
unsatisfied for five (5) Business Days;
(c) Borrowing Under the Indenture in Violation of the Loan Contract.
Default by the Borrower in the observance or performance of any covenant or
agreement contained in Subsection (a), (b) or (c) of Section 5.8;
(d) Other Covenants. Default by the Borrower in the observance or
performance of any other covenant or agreement contained in any of the Loan
Documents, which shall remain unremedied for thirty (30) calendar days after
written notice thereof shall have been given to the Borrower by the RUS;
(e) Corporate Existence. The Borrower shall forfeit or otherwise be
deprived of its corporate charter or any franchises, permits, easements,
consents or licenses required to carry on any material portion of its business;
(f) Other Obligations. Default by the Borrower in the payment of any
obligation, whether direct or contingent, for borrowed money in excess of
$10,000,000 or in the performance or observance of the terms of any instrument
pursuant to which such obligation was created or securing such obligation;
(g) Bankruptcy. A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Borrower in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official, or ordering the winding up or
liquidation of its affairs, and such decree or order shall remain unstayed and
in effect for a period of ninety (90) consecutive days or the Borrower shall
commence a voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or under any such law, or consent to the
appointment or taking possession by a receiver, liquidator, assignee, custodian
or trustee, of a substantial part of its property, or make any general
assignment for the benefit of creditors; and
(h) Dissolution or Liquidation. Other than as provided in the immediately
preceding subsection, the dissolution or liquidation of the Borrower, or failure
by the Borrower promptly to forestall or remove any execution, garnishment or
attachment of such consequence as shall impair its ability to continue its
business or fulfill its obligations and such execution, garnishment or
attachment shall not be vacated within thirty (30) days. The term "dissolution
or liquidation of the Borrower," as used in this Subsection (h), shall not be
construed to include the cessation of the corporate existence of the Borrower
resulting either from a merger or consolidation of the Borrower into or with
another corporation following a transfer of all or substantially all its assets
as an entirety, under the conditions permitting such actions.
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ARTICLE VII -- REMEDIES
Upon the occurrence of an Event of Default, then the RUS may pursue all
rights and remedies available to the RUS that are contemplated by this Agreement
in the manner, upon the conditions and with the effect provided in this
Agreement, including, but not limited to, a suit for specific performance,
injunctive relief or damages. The RUS is hereby authorized, to the maximum
extent permitted by applicable law, to demand specific performance of this
Agreement at any time when the Borrower shall have failed to comply with any
provision of this Agreement applicable to it. The Borrower hereby irrevocably
waives, to the maximum extent permitted by applicable law, any defense based on
the adequacy of a remedy at law that might be asserted as a bar to such remedy
of specific performance. Nothing herein shall limit the right of the RUS to
pursue all rights and remedies available to a creditor at law or in equity
following the occurrence of an Event of Default, or any right or remedy
available to the RUS as a Holder of an Obligation under the Indenture. Each
right, power and remedy of the RUS shall be cumulative and concurrent, and
recourse to one or more rights or remedies shall not constitute a waiver of any
other right, power or remedy.
ARTICLE VIII -- MISCELLANEOUS
Section 8.1 Notice to RUS; Objection of RUS
Before undertaking any transaction described in Article V that requires
compliance with this Section 8.1, the Borrower shall give to the RUS (i) notice
in writing describing in reasonable detail the proposed transaction and
expressly stating that the transaction is covered by this Section 8.1 and (ii)
drafts of any documents to effect such transaction. If the RUS delivers to the
Borrower written notice that it objects to the proposed transaction after (I) 60
days (or such shorter period as the parties shall agree to in writing) in the
case of any transaction of the nature described in paragraph (a) below, or (II)
30 days (or such shorter period as the parties shall agree to in writing) in the
case of any transaction of the nature described in paragraph (b) below, the
Borrower shall not complete the transaction without RUS approval.
(a) Transactions requiring compliance with this Section 8.1 pursuant to
Sections 5.2, 5.4, 5.6, 5.8 (i), 5.8 (ii), 5.8 (iv), 5.8 (vi), 5.8
(viii), 5.8 (ix), 5.9, 5.11 and 5.12 shall be subject to a 60-day
review and objection period (or such shorter period as the parties
shall agree to in writing); and
(b) Transactions requiring compliance with this Section 8.1 pursuant to
Sections 5.5, 5.7, 5.8 (iii), 5.8 (v), 5.8 (vii), 5.8 (x), 5.8 (xi)
and 5.10 shall be subject to a 30-day review and objection period
(or such shorter period as the parties shall agree to in writing).
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Section 8.2 Notices
All notices, requests and other communications provided for herein,
including, without limitation, any modifications of, or waivers, requests or
consents under, this Agreement, shall be given or made in writing (including,
without limitation, by telecopy) and delivered to the intended recipient at the
"Address for Notices" specified below; or, as to any party, at such other
address as shall be designated by such party in a notice to the other party.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telecopier or personally
delivered or, in the case of a mailed notice, upon receipt, in each case given
or addressed as provided for herein. The Address for Notices of the respective
parties are as follows:
The Government:
Rural Utilities Service
United States Department of Agriculture
1400 Independence Avenue, S.W.
Washington, DC 20250-1500
Fax: (202) 720-1725
Attention: Administrator
With a copy to:
Rural Utilities Service
United States Department of Agriculture
1400 Independence Avenue, S.W.
Stop: 1568
Washington, DC 20250-1500
Fax: (202) 720-1401
Attention: Power Supply Division
The Borrower:
Oglethorpe Power Corporation
2100 East Exchange Place
Post Office Box 1349
Tucker, Georgia 30085-1349
Fax: (770) 270-7872
Attention: President and Chief Executive Officer
With a copy to: Vice President, Finance
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Section 8.3 Expenses
To the extent allowed by law, the Borrower shall pay all costs and
expenses of the RUS, including reasonable fees of counsel, incurred in
connection with the enforcement of the Loan Documents or with the preparation
for such enforcement if the RUS has reasonable grounds to believe that such
enforcement may be necessary.
Section 8.4 Late Payments
If payment of any amount due hereunder is not received at the United
States Treasury in Washington, DC, or such other location as the RUS may
designate to the Borrower, within five (5) Business Days after the due date
thereof or such other longer time period as the RUS may prescribe from time to
time in its policies of general application in connection with any late payment
charge (such unpaid amount being herein called the "delinquent amount," and the
period beginning after such due date until payment of the delinquent amount
being herein called the "late-payment period"), the Borrower shall pay to the
RUS, in addition to all other amounts due under the terms of the Outstanding
Notes and this Agreement, any late-payment charge as may be fixed by RUS
Regulations from time to time on the delinquent amount for the late-payment
period.
Section 8.5 Filing Fees
To the extent permitted by Law, the Borrower agrees to pay all expenses of
the RUS (including the fees and expenses of its counsel) in connection with the
filing or recordation of all financing statements and instruments as may be
required by the RUS in connection with this Agreement, including, without
limitation, all documentary stamps, recordation and transfer taxes and other
costs and taxes incident to recordation of any document or instrument in
connection herewith. The Borrower agrees to save harmless and indemnify the RUS
from and against any liability resulting from the failure to pay any required
documentary stamps, recordation and transfer taxes, recording costs, or any
other expenses incurred by the RUS in connection with this Agreement. The
provisions of this Section 8.5 shall survive the execution and delivery of this
Agreement and the payment of all other amounts due hereunder or due on the
Outstanding Notes.
Section 8.6 No Waiver
No failure on the part of the RUS to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise by the RUS of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right.
Section 8.7 Governing Law
EXCEPT TO THE EXTENT GOVERNED BY APPLICABLE FEDERAL LAW, THE LOAN
DOCUMENTS SHALL BE DEEMED TO BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF GEORGIA.
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Section 8.8 Holiday Payments
If any payment to be made by the Borrower hereunder shall become due on a
day which is not a Business Day, such payment shall be made on the next
succeeding Business Day and such extension of time shall be included in
computing any interest in respect of such payment.
Section 8.9 Successors and Assigns
This Agreement shall be binding upon and inure to the benefit of the
Borrower and the RUS and their respective successors and assigns, except that
the Borrower may not assign or transfer its rights or obligations hereunder
without the prior written consent of the RUS.
Section 8.10 Complete Agreement; Amendments
This Agreement and the other Loan Documents are intended by the parties to
be a complete and final expression of their agreement. However, the RUS reserves
the right to waive its rights to compliance with any provision of this
Agreement, the RUS Regulations and the other Loan Documents. No amendment,
modification, or waiver of any provision hereof or thereof, and no consent to
any departure of the Borrower herefrom or therefrom, shall be effective unless
approved in writing by the RUS in the form of either RUS Regulations or other
writing signed by or on behalf of the RUS, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given. Any Schedule to this Agreement may be amended and replaced by
attaching a revised Schedule hereto, which revised Schedule shall have been
signed by both parties hereto.
Section 8.11 Headings
The headings and sub-headings contained in the titling of this Agreement
are intended to be used for convenience only and do not constitute part of this
Agreement.
Section 8.12 Severability
If any term, provision or condition, or any part thereof, of this
Agreement shall for any reason be found or held invalid or unenforceable by any
governmental agency or court of competent jurisdiction, such invalidity or
unenforceability shall not affect the remainder of such term, provision or
condition nor any other term, provision or condition, and this Agreement, the
Outstanding Notes, and the Indenture shall survive and be construed as if such
invalid or unenforceable term, provision or condition had not been contained
herein.
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Section 8.13 Right of Set off
Upon the occurrence and during the continuance of any Event of Default,
the RUS is hereby authorized at any time and from time to time, without prior
notice to the Borrower, to exercise rights of set off or recoupment and apply
any and all amounts held or hereafter held, by the RUS or owed to the Borrower
or for the credit or account of the Borrower against any and all of the
obligations of the Borrower now or hereafter existing hereunder or under the
Outstanding Notes. The RUS agrees to notify the Borrower promptly after any such
set off or recoupment and the application thereof, provided that the failure to
give such notice shall not affect the validity of such set off, recoupment or
application. The rights of the RUS under this Section 8.13 are in addition to
any other rights and remedies (including other rights of set off or recoupment)
which the RUS may have. The Borrower waives all rights of set off, deduction,
recoupment or counterclaim.
Section 8.14 Schedules and Exhibits
Each Schedule and Exhibit attached hereto and referred to herein is each
an integral part of this Agreement.
Section 8.15 Sole Benefit
The rights and benefits set forth in this Agreement are for the sole
benefit of the parties thereto and may be relied upon only by them.
Section 8.16 Existing Loan Contract
This Agreement consolidates all the documents constituting the Existing
Loan Contract and amends the Existing Loan Contract so that, as of the date of
this Agreement, it reads in its entirety as herein provided. As of the date
hereof, this Agreement replaces and supersedes the Existing Loan Contract.
Section 8.17 Authority of RUS Representatives
In the case of any consent, approval or waiver from the RUS that is
required under this Agreement or any other Loan Document, such consent, approval
or waiver must be in writing and signed by an authorized RUS representative to
be effective. As used in this Section 8.17, "authorized RUS representative"
means the Administrator, and also means a person to whom the Administrator has
officially delegated specific or general authority to take the action in
question.
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Section 8.18 Relation to RUS Regulations
(a) In case of any conflict between the terms of this Agreement or the
Indenture and the provisions of the RUS Regulations, the terms of this Agreement
and the Indenture shall control.
(b) The RUS Regulations shall apply to the Borrower to the extent and
under the conditions expressly set forth in this Agreement (other than in
Section 4.15).
(c) The Borrower recognizes that some RUS Regulations implement Federal
statutes or regulatory policies that are not limited to rural electrification
but apply to many types of Federal assistance. Nothing herein is intended to, or
shall be deemed to, waive the requirements of any Federal statute or regulation
that is applicable to the Borrower independently of any requirement made
applicable solely by the RUS Regulations.
(d) Subject to Subsections (b) and (c) above, if on the date of this
Agreement, any RUS Regulation conflicts with the terms of this Agreement or the
Indenture or imposes additional or different requirements:
(i) the Borrower is hereby deemed to have complied with, or
otherwise satisfied the requirements of, or received approval under,
such RUS Regulation; and
(ii) pursuant to 7 C.F.R. ss. 1710.4 (1996), the RUS hereby waives
compliance by the Borrower with such RUS Regulation.
Section 8.19 Term
This Agreement shall remain in effect until one of the following two
events has occurred:
(a) The Borrower and the RUS replace this Agreement with another written
agreement; or
(b) All of the Borrower's obligations under this Agreement and the
Outstanding Notes have been discharged and paid.
(Signatures begin on next page.)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, the Borrower's execution to be attested under seal, as of the day
and year first above written.
OGLETHORPE POWER
CORPORATION (AN
ELECTRIC MEMBERSHIP
GENERATION & TRANSMISSION
CORPORATION)
By: /s/ T.D. Kilgore
--------------------------------------
T. D. Kilgore
President and Chief Executive Officer
Attest: /s/ Patricia N. Nash
----------------------------------
Patricia N. Nash
Assistant Secretary
[CORPORATE SEAL]
(Signatures continued on next page.)
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(Signatures continued from previous page.)
UNITED STATES OF AMERICA,
acting by and through the Administrator
of the Rural Utilities Service
By: /s/ Wally Beyer
------------------------------------
Administrator
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SCHEDULE 1
to the Amended and Consolidated Loan Contract,
dated as of March 1, 1997, between Oglethorpe Power Corporation
(An Electric Membership Generation & Transmission Corporation)
and the United States of America
1. Letter Agreements amending and supplementing the Existing Contract:
(a) "H13" Amendment to Amended and Consolidated Loan Contract between
the Borrower and United States of America, dated as of September 14,
1984;
(b) "H13" Letter, dated September 28, 1984, from Harold V. Hunter,
Administrator of REA to Hubert Hancock, President of the Borrower;
(c) "PCB III" Letter, dated December 18, 1984, from Harold V. Hunter,
Administrator of REA to Hubert Hancock, President of the Borrower;
(d) "PCB IV" Letter, dated November 12, 1985, from Harold V. Hunter,
Administrator of REA to Hubert Hancock, President of the Borrower;
(e) "Sale-Leaseback" Letter, dated December 27, 1985, from Harold V.
Hunter, Administrator of REA to Hubert Hancock, President of the
Borrower;
(f) "Vogtle K8" Letter, dated March 3, 1986, from Jack Van Mark, Acting
Administrator of REA to Hubert Hancock, President of the Borrower;
(g) Reply Letter to "Vogtle K8", dated August 11, 1986, from Hubert
Hancock, President of the Borrower, to Harold V. Hunter,
Administrator of REA;
(h) "Scherer Refinancing" Letter, dated October 17, 1986, from Harold V.
Hunter, Administrator of REA, to Hubert Hancock, Chairman of the
Board of the Borrower;
(i) "Vogtle K8" Letter, dated January 9, 1987, from Jack Van Mark,
Acting Administrator of REA, to F. F. Stacy, President and CEO of
the Borrower;
(j) "Rocky Mountain L8" Letter, dated September 30, 1988, from Harold V.
Hunter, Administrator of REA, to Hubert Hancock, Chairman of the
Board of the Borrower;
(k) "Pollution Control Revenue Bonds" Letter, dated March 20, 1990, from
Jack Van Mark, Acting Administrator of REA, to J. Calvin Earwood,
Chairman of the Board of the Borrower;
(l) "Bulk Power Agreements" Loan Contract Amendment, dated as of July 1,
1991, between the Borrower and the United States of America;
(m) "Pollution Control Revenue Bonds" Letter, dated April 6, 1992, from
Michael M.F. Liu, Acting Administrator of REA, to J. Calvin Earwood,
Chairman of the Board of the Borrower;
(n) Amendment to Amended and Consolidated Loan Contract between the
Borrower and the United States of America, dated as of June 12,
1992;
(o) "Pollution Control Revenue Bonds" Letter, dated October 20, 1992,
from James B. Huff, Sr., Administrator of REA, to Tom D. Kilgore,
President/CEO of the Borrower;
(p) "Pollution Control Revenue Bonds" Letter, dated February 25, 1993,
from James B. Huff, Sr., Administrator of REA, to Tom D. Kilgore,
President/CEO of the Borrower;
(q) "Pollution Control Revenue Bonds" Letter, dated August 26, 1993 from
James B. Huff, Sr., Administrator of REA, to Tom D. Kilgore,
President/CEO of the Borrower;
(r) "Pollution Control Revenue Bonds" Letter, dated August 31, 1994,
from Wally Beyer, Administrator of REA, to Tom Kilgore,
President/CEO of the Borrower; and
(s) "Pollution Control Revenue Bonds" Letter, dated January 8, 1997,
from Wally Beyer, Administrator of RUS, to T.D. Kilgore,
President/CEO of the Borrower, as supplemented by that certain
letter, dated February 21, 1997, from Wally Beyer, Administrator of
RUS, to T. D. Kilgore, President/CEO of the Borrower.
2. "Contemporaneous Loans" shall mean the loans evidenced by the following:
(a) Promissory Note, dated March 1, 1997, made by the Borrower to the
order of CoBank, ACB, in the original face principal amount of
$1,856,475.12; and
(b) Promissory Note, dated March 1, 1997, made by the Borrower to the
order of CoBank, ACB, in the original face principal amount of
$7,102,740.26.
3. "Outstanding Notes" shall mean the following notes:
(a) Retained Indebtedness Note, dated as of March 1, 1997, from the
Borrower to FFB, in the original face principal amount not to exceed
$2,637,782,327.56;
(b) Reimbursement Note, dated as of March 1, 1997, from the Borrower
to the Government, acting through the Administrator of the RUS;
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(c) Mortgage Note, dated as of March 1, 1997, from the Borrower to the
Government, acting through the Administrator of the RUS, in the
original face principal amount of $3,820,352.89; and
(d) Mortgage Note, dated as of March 1, 1997, from the Borrower to the
Government, acting through the Administrator of the RUS, in the
original face principal amount of $14,786,985.70.
4. "Plant Agreements" shall mean, collectively, the following agreements
relating to the ownership and operation of generating facilities:
(a) Plant Robert W. Scherer Units Numbers One and Two Purchase and
Ownership Participation Agreement among Georgia Power Company,
the Borrower, Municipal Electric Authority of Georgia and City
of Dalton, Georgia (the "Co-Owners"), dated as of May 15,
1980, as amended by that certain Amendment, among the
Co-Owners, dated as of December 30, 1985; and as amended by
that certain Amendment Number Two, among the Co- Owners, dated
as of July 1, 1986; and as amended by that certain Amendment
Number Three, among the Co-Owners, dated as of August 1, 1988;
and as amended by that certain Amendment Number Four, among
the Co-Owners, dated as of December 31, 1990;
(b) Plant Robert W. Scherer Units Numbers One and Two Operating
Agreement among the Co-Owners, dated as of May 15, 1980, as
amended by that certain Amendment, among the Co-Owners, dated
as of December 30, 1985; and as amended by that certain
Amendment Number Two, among the Co-Owners, dated as of
December 31, 1990;
(c) Plant Scherer Managing Board Agreement, among the Co-Owners,
Gulf Power Company, Florida Power & Light Company and
Jacksonville Electric Authority, dated as of December 31,
1990;
(d) Alvin W. Vogtle Nuclear Units Numbers One and Two Purchase and
Ownership Participation Agreement, among the Co-Owners, dated
as of August 27, 1976, as amended by that certain Amendment
Number One, among the Co-Owners dated as of January 18, 1977;
and as amended by that certain Amendment Number Two, among the
Co-Owners, dated as of February 24, 1977;
(e) Alvin W. Vogtle Nuclear Units Numbers One and Two Operating
Agreement among, the Co-Owners, dated as of August 27, 1976;
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(f) Plant Hal Wansley Purchase and Ownership Participation
Agreement, between Georgia Power Company and the Borrower,
dated as of March 26, 1976, as amended by that certain
Amendment, dated as of January 15, 1995;
(g) Plant Hal Wansley Operating Agreement, between Georgia Power
Company and Borrower, dated as of March 26, 1976;
(h) Plant Hal Wansley Combustion Turbine Agreement, between
Georgia Power Company and the Borrower, dated as of August 2,
1982, and Amendment No. 1, dated as of October 20, 1982;
(i) Edwin I. Hatch Nuclear Plant Purchase and Ownership
Participation Agreement, between Georgia Power Company and the
Borrower, dated as of January 6, 1975;
(j) Edwin I. Hatch Nuclear Plant Operating Agreement, between
Georgia Power Company and the Borrower, dated as of January 6,
1975;
(k) The Rocky Mountain Pumped Storage Hydroelectric Project
Operating Agreement, dated as of November 18, 1988, between
the Borrower and Georgia Power Company; and
(l) The Rocky Mountain Pumped Storage Hydroelectric Project
Operating Agreement, dated as of November 18, 1988, between
the Borrower and Georgia Power Company.
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SCHEDULE 2
to the Amended and Consolidated Loan Contract (the "Agreement"),
dated as of March 1, 1997, between Oglethorpe Power Corporation
(An Electric Membership Generation & Transmission Corporation)
and the United States of America
ADDITIONAL AFFIRMATIVE AND NEGATIVE COVENANTS
Section 1 Definitions
Capitalized terms that are not defined in this Schedule 2 shall have the
meanings set forth in the Agreement. The terms defined herein include both the
plural and the singular.
"Affiliates" shall have the meaning given such term in the Purchase
Agreement.
"Alternative Floating Amount" shall have the meaning given such term in
the Interest Rate Swap Agreements.
"Base Capacity Price" shall have the meaning given such term in the
Purchase Agreement.
"BPSA" shall mean the Block Power Sale Agreement, dated as of November 12,
1990.
"Contract" shall mean any one of the NMBA, the BPSA, the CSA, and the
Umbrella Agreement, including any schedules or exhibits thereto other than
Appendix A to the NMBA and Schedule A to the BPSA, and including any executed
Nuclear Services Agreement or other contract described at Section 2.3.2 of the
NMBA.
"CSA" shall mean the Coordination Services Agreement, dated as of November
12, 1990.
"Equity Transfer Interest" shall have the meaning given such term in the
Purchase Agreement.
"Facility" shall have the meaning given such term in the Purchase
Agreement.
"General Partner" shall have the meaning given such term in the Purchase
Agreement.
"General Partner Holding Company" shall have the meaning given such term
in the Purchase Agreement.
"Intercreditor Agreement" shall have the meaning given such term in the
Rocky Mountain Participation Agreements.
"Interest Rate Swap Agreements" shall mean the Interest Rate Swap
Agreements, each dated as of December 1, 1992, between the Borrower and AIG
Financial Products Corp.
"Monthly Energy Payment" shall have the meaning given such term in the
Purchase Agreement.
"NMBA" shall mean the Nuclear Managing Board Agreement, dated as of
November 12, 1990.
"Operating Agent" shall have the meaning given such term in the Purchase
Agreement.
"PCB Documents" shall mean the indentures, loan agreements, notes, letters
of representation, insurance policies, tender agent agreements, remarketing
agreements and liquidity and standby bond purchase agreements entered into in
connection with the Pollution Control Bonds and the Interest Rate Swap
Agreements.
"Pollution Control Bonds" shall mean those pollution control revenue bonds
issued for the benefit of the Borrower between January 1, 1992 and the "Closing
Date" as defined in the Restructuring Agreement, for which security was
provided, on the date of their respective issuances, under the RUS Mortgage.
"Purchase Agreement" shall mean the Power Purchase Agreement, dated as of
June 12, 1992, between the Borrower and Seller, as amended from time to time.
"Rocky Mountain Lease Transaction" shall mean the lease and leaseback
arrangements of the Borrower's undivided interest in the Rocky Mountain Pumped
Storage Hydroelectric Project, as contemplated by the Rocky Mountain
Participation Agreements.
"Rocky Mountain Participation Agreements" shall mean those certain four
(4) Participation Agreements, dated as of December 30, 1996 and those certain
two (2) Participation Agreements, dated as of January 3, 1997, between the
Borrower, Rocky Mountain Leasing Corporation and certain other parties
identified therein, including Philip Morris Capital Corporation, NationsBanc
Leasing and R. E. Corporation and First Chicago Leasing Corporation, as Owner
Participants, as such agreements may hereafter be amended or supplemented from
time to time.
"Rocky Mountain Transaction Documents" shall be as defined in the Rocky
Mountain Participation Agreements.
"Scherer Participation Agreements" shall mean the Participation
Agreements, dated as of December 30, 1985, between the Borrower and each of IBM
Credit Finance Corporation, HEI
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Investment Corp., Ford Motor Credit Corporation and Chrysler Capital
Corporation, as such agreements have been or may hereafter be amended or
supplemented from time to time.
"Scherer Transaction" shall mean the sale and leaseback arrangements of
the Borrower's 60% undivided interest in Unit No. 2 of Plant Robert W. Scherer,
as contemplated by the Scherer Participation Agreements.
"Scherer Transaction Documents" shall be as defined in the Scherer
Participation Agreements.
"Seller" shall mean the Hartwell Energy Limited Partnership.
"Senior Creditors" shall have the meaning given such term in the
Intercreditor Agreement.
"Senior Financing Agreements" shall have the meaning given such term in
the Intercreditor Agreement.
"Senior Secured Parties" shall have the meaning given such term in the
Intercreditor Agreement.
"Settlement Price" shall have the meaning given such term in the Purchase
Agreement.
"Termination Event" shall have the meaning given such term in the Interest
Rate Swap Agreements.
"Transco Energy" shall have the meaning given such term in the Purchase
Agreement.
"Umbrella Agreement" shall mean the ITSA, Power Sale and Coordination
Umbrella Agreement, dated as of November 12, 1990.
Section 2 Notices
The Borrower shall promptly furnish to the RUS, or notify the RUS of, any
of the following as soon as practical after receipt thereof or after it has
obtained actual knowledge thereof:
(i) Copies of:
(a) All notices, certificates and opinions which the Borrower
receives in connection with the transaction under the terms of
the Scherer Transaction Documents;
(b) Any executed "Nuclear Services Agreement" (as defined by the
NMBA);
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(c) Any and all "Strategic Plans" (as defined in the NMBA)
approved under the NMBA;
(d) Any amendment to Appendix A of the NMBA or Schedule A to the
BPSA;
(e) Any agreement entered into between the Seller and the
Operating Agent; or
(f) All notices or other communications given to or received by
the Borrower with respect to any "Event of Default," "Loan
Event of Default" or "Subordinated Deed to Secure Debt and
Security Agreement Event of Default" under any "Operative
Document" (all as defined in the Rocky Mountain Participation
Agreements).
(ii) Any attempt to remove the Borrower as agent under Article IV of the
Rocky Mountain Pumped Storage Hydroelectric Project Operating
Agreement, dated as of November 18, 1988, between the Borrower and
Georgia Power Company (the "Ownership Agreement"), or Article VIII
of the Ownership Agreement; or the occurrence of any default under
the Ownership Agreement or the Rocky Mountain Pumped Storage
Hydroelectric Project Ownership Agreement, dated as of November 18,
1988, between the Borrower and Georgia Power Company, which is
material and is continuing; or
(iii) Any of the following and, if the RUS so requests in writing, the
Borrower shall provide information concerning any of the following
in form and substance satisfactory to the RUS:
(c) That a default or event of default has occurred under any of
the PCB Documents;
(d) That a default or event of default under any of the PCB
Documents has been cured;
(e) That the Borrower has been called upon to protect, indemnify
or otherwise hold harmless any person or entity pursuant to
any of the PCB Documents;
(f) That an event has occurred which causes the Alternative
Floating Amount to become effective under any of the Interest
Rate Swap Agreements;
(g) That any trustee under any PCB Document has resigned, been
removed or has become incapable of acting;
(h) That a Termination Event has occurred under any of the
Interest Rate Swap Agreements;
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(i) That any of the PCB Documents have been terminated or
partially terminated;
(h) That any of the Contracts have expired or have been
terminated, extended or assigned either by any of the parties
thereto or by a "Governmental Authority" (as defined in the
applicable Contract) or that the parties to such Contract have
executed an amendment to such Contract or any Governmental
Authority has amended such Contract;
(i) That a party to the NMBA, including the Borrower, has referred
a dispute to arbitration pursuant to Section 9.14 of the NMBA,
and thereafter, the results of such arbitration; or that a
party to the BPSA or CSA has referred a dispute to the Chief
Executive Officers for resolution pursuant to Sections 5.3(c)
of the BPSA or 19.3(c) or 19.4(b) of the CSA, as the case may
be, and such dispute remains unresolved for 90 days after
referral;
(j) That a party to any Contract, including the Borrower, has
commenced a legal proceeding either before a court or
governmental agency with respect to such Contract (including,
but not limited to, applications to FERC);
(k) The President and Chief Executive Officer of the Borrower has
concluded, or any other party to a Contract has given the
Borrower written notice alleging, that a party to such
Contract has failed to act in accordance with Prudent Utility
Practices (as defined in the applicable Contract) or has
engaged in willful misconduct; provided, however, that
Borrower shall not be obligated to notify the RUS of any
action which could not reasonably be expected to have a
Material Adverse Effect;
(l) That a person or entity has made a claim against any party to
a Contract (including the Borrower); provided, however, that
the Borrower need not provide notice of any claim the payment
of which could not reasonably be expected to have a Material
Adverse Effect;
(m) That any member of the Borrower has sought service from
Georgia Power Company pursuant to the "Antitrust Conditions"
(as defined in the Umbrella Agreement);
(n) That any representation or warranty of Georgia Power Company
under Section 7.2 of the Umbrella Agreement or any matter in
the legal opinion furnished to Borrower under Section 7.4 of
the Umbrella Agreement is incorrect or in dispute;
-5-
(o) That as the result of any audit conducted pursuant to a
party's rights under any Contract, such party has made a claim
or reserved the right to make a claim for an adjustment in an
amount in excess of $10,000,000 for any charge made by Georgia
Power Company under such contract; provided however, that the
dollar amount stated in this condition is in January 1, 1991
dollars and shall be escalated annually for inflation using
the Handy-Whitman Index of Public Utility Construction Costs
(South Atlantic Region);
(p) That a Governmental Authority (as defined in the NMBA) has
assessed against the Operating Agent (as defined in the NMBA)
a criminal penalty of any kind or a civil penalty of more than
$110,000 or, when added to any other civil penalty assessed
within the previous 12 months, is in the aggregate in excess
of $440,000;
(q) That a management audit is being conducted pursuant to Section
5.3 of the NMBA and, when applicable, that such audit has been
concluded;
(r) That the Borrower has received notice pursuant to Section 4.B
of the NSA that a proceeding has been initiated in which
"SONOPCO" (as defined in the NSA) is a party;
(s) That Georgia Power Company has given notice pursuant to the
BPSA that it will fully or partially retire a "Unit" (as
defined in the BPSA) as the result of a "Force Majeure Event"
(as defined in the BPSA);
(t) That the Borrower has failed to make a payment when due under
the BPSA or CSA, received notice that it is delinquent or in
default in its payments under the PSA or CSA, or intends to
delay or withhold any payment claimed by Georgia Power Company
to be due under the BPSA or CSA;
(u) That the Borrower has given notice to Georgia Power Company
pursuant to Section 15.9 of the CSA that it desires to stop
purchasing load regulation services;
(v) That the Purchase Agreement has expired or has been terminated
or amended, or that the Seller has assigned or otherwise
transferred the Facility or its rights and obligations under
the Purchase Agreement to any other entity;
(w) That a notice of termination of the Purchase Agreement has
been either delivered or received by the Borrower;
(x) That, pursuant to Section 5.5 of the Purchase Agreement, the
Seller has
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obtained an increase in the Base Capacity Price or the Monthly
Energy Payment and the amount of such increase;
(y) That a filing has been made with the FERC for approval, or
that FERC on its own motion has proposed a change to any
charge, rate or tariff under the Purchase Agreement, and,
thereafter, the action taken by FERC;
(z) That (i) the Borrower has provided written notice to the
Seller that the Seller has defaulted under the Purchase
Agreement and whether the Borrower is considering terminating
the Purchase Agreement and exercising its option to purchase
the Facility if the default is not cured, or (ii) the Seller
has defaulted under the Purchase Agreement, even though the
Borrower has not yet provided written notice to the Seller to
that effect, except that the Borrower shall not be obligated
to provide notice of defaults if the Borrower reasonably
believes that the default will be satisfactorily cured within
two (2) days following the default; provided, however, that
the Borrower shall provide notice to the RUS after such two
day period if the default has not been cured;
(aa) That the Borrower has received notice that it is in default
under the Purchase Agreement;
(ab) That a default under the Purchase Agreement has not been cured
within the period provided in the Purchase Agreement;
(ac) That Transco Energy or any of its Affiliates has transferred
an Equity Transfer Interest;
(ad) That Transco Energy or any of its Affiliates has sold more
than fifty percent of the outstanding stock of a General
Partner Holding Company;
(ae) That as a result of an audit conducted by the Borrower
pursuant to Section 14.3 of the Purchase Agreement, the
Borrower has requested an adjustment to the payments made by
the Borrower in an amount in excess of $5 million, or has
requested to reserve the right to request such an adjustment;
provided, however, that the dollar amount stated in this
subsection is in January 1, 1992 dollars and shall be
escalated annually for inflation using the Handy-Whitman
Index of Public Utility Construction Costs (South Atlantic
Region); or
(af) That any insurance coverage required under the Purchase
Agreement has lapsed, been canceled or, for any other reason,
is not in effect.
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Section 3 Amendments
The Borrower shall not, without first complying with the requirements of
Section 8.1 of the Agreement, amend, supplement, waive, terminate, extend or
assign any of the agreements set forth below or agree to do so (except to the
extent specifically governed by Sections 5 or 6 of this Schedule 2):
(a) Section 168 Agreement and Election dated as of April 7, 1982,
between Continental Telephone Corporation and the Borrower;
(b) Section 168 Agreement and Election dated as of April 9, 1982,
between National Service Industries, Inc. and the Borrower;
(c) Section 168 Agreement and Election dated as of April 9, 1982,
between Rollins, Inc. and the Borrower;
(d) The PCB Documents;
(e) The Scherer Transaction Documents;
(f) The Contracts;
(g) The Purchase Agreement; or
(h) The Rocky Mountain Transaction Documents.
Each of the foregoing actions shall be considered described in paragraph (a) of
Section 8.1 of the Agreement and shall be subject to the review and objection
period set forth in such paragraph.
Section 4 1985 -- Plant Scherer Leveraged Lease
4.1 Direction of the RUS. Whenever requested in writing to do so by the
RUS, such requests to be made for good cause as determined solely in the
absolute discretion of the RUS, the Borrower shall exercise such rights and
powers as may be vested in the Borrower and make such elections and requests as
may be available to the Borrower, under the terms of the Scherer Transaction
Documents in such manner and at such times as the RUS may so specify.
4.2 Options to Purchase; Assignment; Etc. The Borrower shall not, with the
prior written approval of the RUS, exercise any of its options to purchase or
renew its lease of an "Undivided Interest" as defined in the Scherer
Participation Agreements; or assign, sublease, transfer or encumber its
leasehold interest in the Undivided Interest.
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Section 5 GPC Agreements
5.1 Actions Requiring Consent of the RUS. The Borrower shall not, without
the prior written consent of the RUS, take any of the following actions:
(a) Execute any conforming amendment to the "Joint Committee Agreements"
(as defined in the NMBA); or
(b) Enter into any agreement pursuant to Section 15.10 of the CSA.
5.2 Notice of Approval or Rejection of any Contract Subject to SEC
Approval. The Borrower shall not, without the prior written approval of the RUS,
vote as a member of the "Nuclear Managing Board" (as defined in the NMBA) to
approve or reject any Contract as described in Section 2.3.2 of the NMBA that is
subject to the prior approval of the Securities and Exchange Commission unless
and until the Borrower shall have first given the RUS written notice of the
proposed vote not less than 60 days prior to such vote. If, upon receipt of such
notice, the RUS shall notify the Borrower within the 60-day period preceding the
vote of an objection to the proposed vote, then the Borrower shall not vote
until it has obtained RUS approval of such vote.
5.3 Reduction Notices. Subject to subsections (a) and (b) of this Section
5.3, the Borrower shall not deliver notice pursuant to Section 2.3 of the BPSA
of its desire to eliminate one or more "Component Block(s)" (as defined in the
BPSA) from the "Master Block" (as defined in the BPSA) (such notice hereinafter
referred to as a "Reduction Notice") until the RUS has received from the
Borrower written notice of its intent to give such Reduction Notice not less
than 60 days prior to the date such notice is to be delivered under Section 2.3
of the BPSA. The Borrower shall provide to its Board of Directors any written
comments RUS provides to the Borrower with respect to the Reduction Notice
proposed by the Borrower.
(a) If the Component Block(s) which the Borrower desires to eliminate
from the Master Block pursuant to a Reduction Notice, together with
any other Component Block(s) previously eliminated from the Master
Block pursuant to prior Reduction Notice(s) exceed 500 MW, then the
Borrower shall not deliver such Reduction Notice without the prior
written consent of the RUS.
(b) The Borrower shall provide such information as the RUS may
reasonably request with respect to the Borrower's decision to
deliver a Reduction Notice.
5.4 Audits. Upon the request of the RUS, the Borrower shall conduct, to
the satisfaction of the RUS, either a management audit or a cost audit, as
provided in Sections 5.2 or 5.3, respectively, of the NMBA. If the RUS requests
in writing, the Borrower shall appoint the United States Department of
Agriculture and the employees and representatives thereof as its duly authorized
representative for the purpose of conducting any such management audit or cost
audit, whether or not such audit is initiated at the direction of the RUS.
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Section 6 Hartwell Power Purchase Agreement
6.1 Actions Requiring Consent of RUS. The Borrower shall not, without the
prior written consent of RUS, take any of the following actions:
(a) Pursuant to Section 3.3 of the Purchase Agreement, exercise its
option to take title to the Facility by paying Seller the Settlement
Price; or
(b) Pursuant to Article XIII of the Purchase Agreement, exercise its
option to purchase all or any part of the Facility.
6.2 Termination Provisions. The following provisions shall apply to a
termination of the Purchase Agreement by the Borrower:
(a) The Borrower shall not give notice of termination to the Seller
unless the RUS has received written notice from the Borrower of its
intent to terminate (a "Default Termination Notice") not less than
30 days prior to the date that the termination notice is delivered
to the Seller. The Borrower may deliver the termination notice to
the Seller so long as the RUS has not notified the Borrower within
the later of 29 days of receipt of the Default Termination Notice or
one business day prior to the Borrower's delivery of a notice of
termination to Seller that the RUS objects to the Borrower
terminating the Purchase Agreement. The Borrower shall provide to
its Board of Directors any written comments which the RUS provides
to the Borrower with respect to the termination; and
(b) If the termination is pursuant to any other provision of the
Purchase Agreement, including Section 3.4 thereof, the Borrower
shall not, without the prior written consent of the RUS, exercise
its right to terminate the Purchase Agreement.
6.3 Option to Purchase Equity of Transco or Affiliates. The Borrower shall
not exercise its option, pursuant to Section 13.2.2 of the Purchase Agreement,
to purchase equity held by Transco Energy or any Affiliate in any General
Partner (i) unless the Borrower has promptly provided the RUS with a copy of the
written notice received from Seller and (ii) until the RUS has received from the
Borrower written notice of its intent to exercise such option not less than 30
days prior to the date the Borrower is to exercise its option or be deemed to
have waived said option. The Borrower shall provide the RUS with such
information available to the Borrower with respect to its option as the RUS may
request. The Borrower shall also provide the RUS with a report analyzing the
economic and business feasibility of the proposed acquisition no less than 60
days prior to the date the Borrower is to exercise its option. The Borrower
shall promptly provide the RUS with any information which affects the
information or report it has previously provided to the RUS pursuant to this
Section 6.3. The Borrower shall provide to its Board of Directors any written
comments which the RUS provides to the Borrower with respect to the exercise of
its option under Section 13.2.2 of the Purchase Agreement. The Borrower may
exercise its option under said Section 13.2.2
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so long as the RUS has not notified the Borrower within 29 days of receipt by
the RUS of notice from the Borrower that the RUS objects to the Borrower's
exercising such option.
6.4 Option to Purchase Equity Transfer Interest. The Borrower shall not
exercise its option, pursuant to Section 13.3 of the Purchase Agreement, to
purchase any Equity Transfer Interest (i) unless the Borrower has promptly
provided the RUS with a copy of the written notice received from Seller and (ii)
until the RUS has received from the Borrower written notice of its intent to
exercise such option not less than 60 days prior to the date the Borrower is to
exercise its option or be deemed to have waived said option. The Borrower shall
provide the RUS with such information available to the Borrower with respect to
its option as the RUS may request. The Borrower shall provide the RUS with a
report analyzing the economic and business feasibility of the proposed
acquisition no less than 90 days prior to the date the Borrower is to exercise
its option. The Borrower shall promptly provide the RUS with any information
which affects any information or report it has previously provided to the RUS
pursuant to this Section. The Borrower shall provide to its Board of Directors
any written comments which the RUS provides to the Borrower with respect to the
exercise of its option under Section 13.3 of the Purchase Agreement. The
Borrower may exercise its option under said Section 13.3 so long as the RUS has
not notified the Borrower within 59 days of receipt by the RUS of notice from
the Borrower that the RUS objects to the Borrower's exercising such option.
6.5 Consent Provision. The Borrower shall not give its written consent to
any agreement between the Seller and the Operating Agent until 14 days after the
Borrower has provided the RUS with a copy of the proposed agreement
substantially in the form it is to be executed.
6.6 Audit. Upon the written request of the RUS, the Borrower shall take
any of the following actions:
(a) Conduct, to the satisfaction of the RUS, an audit pursuant to
Section 14.3 of the Purchase Agreement;
(b) Appoint the United States Department of Agriculture and the
employees and representatives thereof as its duly authorized agent
for the purpose of conducting an audit pursuant to Section 14.3 of
the Purchase Agreement; or
(c) Promptly take such actions as may be required to terminate the
Purchase Agreement pursuant to its terms if the RUS determines that
the failure of the Borrower to do so would have a Material Adverse
Effect.
Section 7 Rocky Mountain Lease Transaction
The Borrower will not enter into or consent to any amendments or
modifications of, or accept any waivers with respect to, any of the "Operative
Documents" (as defined in the Rocky Mountain Participation Agreements) which
would adversely affect the rights or remedies of the Senior Secured
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Parties and Senior Creditors with respect to the "Undivided Interest," the
"Ground Interest" or the "Rocky Mountain Agreements" (as such terms are defined
in the Rocky Mountain Participation Agreements) under the Intercreditor
Agreement or under the Senior Financing Agreements without the consent of the
Government (which consent may be given or withheld in the sole and absolute
discretion of the Government).
Section 8 Application of GTC Sale Proceeds
The Borrower shall apply, within ninety (90) days following receipt
thereof, an amount equal to the net cash proceeds, if any, received from GTC
pursuant to Section 2.4(g) of the Restructuring Agreement, to the prepayment,
redemption or defeasance of Existing Obligations.
Section 9 Waiver
Any of the requirements contained in this Schedule 2 may be waived by the
RUS upon written notice provided to the Borrower; provided, however, that such
waiver may be rescinded by the RUS, in the sole discretion of the RUS, upon
written notice of such rescission provided to the Borrower. In the event written
notice is provided to the Borrower that a waiver has been rescinded, then the
requirements to which the notice relates shall be fully binding upon and
enforceable against the Borrower 30 days after such notice is received by the
Borrower, and such rescission shall not affect any action taken pursuant to any
such waiver during the period of its effectiveness.
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EXHIBIT A
LOCKBOX AGREEMENT
This LOCKBOX AGREEMENT (this "Agreement") is entered into as of
March 1, 1997, by and among SunTrust Bank, Atlanta, a Georgia banking
corporation (the "Bank"), Oglethorpe Power Corporation (An Electric Membership
Generation & Transmission Corporation), a Georgia electric membership
corporation (the "Company"), and SunTrust Bank, Atlanta, a Georgia banking
corporation, not individually or personally but solely in its capacity as
trustee (the "Trustee") under the Indenture (defined below).
WHEREAS, the Company, as grantor, and the Trustee have entered into
an Indenture, dated as of March 1, 1997 (such indenture, as from time to time
amended, supplemented or restated, the "Indenture"), whereby, among other
things, the Company has granted a security interest in all contracts of the
Company for the purchase or sale of electric power and energy by or on behalf of
the Company and having an original term in excess of one year;
WHEREAS, the Company, as debtor, and the Trustee have also entered
into a Security Agreement, dated as of March 1, 1997 (such security agreement,
as from time to time amended, supplemented or restated, the "Security
Agreement"; the Security Agreement and the Indenture, collectively, the
"Security Documents"), whereby, among other things, the Company has granted a
security interest in all contracts of the Company for the purchase or sale of
electric power and energy by or on behalf of the Company and having an original
term in excess of one year;
WHEREAS, the Company has entered into contracts, dated as of August
1, 1996, for the sale of electric power and energy to each of its members for
original terms exceeding one year (such contracts, as from time to time amended,
supplemented or restated, collectively, the "Wholesale Power Contracts");
WHEREAS, under the Security Documents, the Company has also granted
a security interest in the proceeds of the "Trust Estate" (as defined in the
Indenture) and the "Collateral" (as defined in the Security Agreement; the Trust
Estate and the Collateral being collectively referred to herein as the "Trust
Estate"), including all proceeds of the Wholesale Power Contracts;
WHEREAS, the Company and the United States of America, acting by and
through the Administrator of the Rural Utilities Service (the "RUS"), have
entered into an Amended and Consolidated Loan Contract, dated as of March 1,
1997 (such loan contract, as from time to time amended, supplemented or
restated, the "Loan Contract") in which the Company has agreed, upon the
occurrence of certain conditions and at the request of the RUS, to deposit cash
proceeds of the Trust Estate as provided in the Security Documents, the Loan
Contract and this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Definitions. Terms used in this Agreement with initial
letters capitalized that are defined in the Indenture and are not otherwise
defined herein have the meanings assigned
to them in the Indenture. In addition, the following terms have the meanings
assigned to them below:
(a) "Applicable Period" shall mean any period commencing on the date the
Company receives notice from the RUS in writing that a Highest Oversight Period
(as defined in the Loan Contract) exists, and ending on the date the Company
receives notice from the RUS in writing that such Highest Oversight Period no
longer exists; and
(b) "Pledged Revenues" shall mean all cash proceeds (as defined in the
Uniform Commercial Code) of the Trust Estate received or receivable by the
Company in which the Security Documents create a security interest pursuant to
the Uniform Commercial Code, in each case that are not deposited pursuant to the
Indenture or required to be deposited with the Trustee pursuant to the
Indenture.
Section 2. Lockbox Account. There is hereby created and established
with the Bank a special account to be titled the "Oglethorpe Power Corporation
Special Cash Account" (the "Lockbox Account"), account number 10630500. The
money deposited into the Lockbox Account, together with all investments thereof
and investment income therefrom, shall be applied solely as provided in this
Agreement.
Section 3. Account Subject to Pledge of the Security Documents.
Amounts deposited into the Lockbox Account shall constitute a portion of the
Trust Estate pledged pursuant to the Security Documents for the equal and
ratable security of all the Outstanding Secured Obligations in accordance with
and as provided by the terms of the Outstanding Secured Obligations and the
Security Documents. The Bank shall hold all such amounts deposited in the
Lockbox Account pursuant to this Agreement as agent of the Trustee. The Lockbox
Account shall not be closed without the written consent of the RUS.
Section 4. Partial Waiver of Right of Set Off. Except to the extent
of any amounts due to the Bank on account of items credited to the Lockbox
Account prior to collection that are not subsequently collected, the Bank hereby
waives, and agrees that it shall not exercise, any right of set off or any
banker's lien with respect to the Lockbox Account; provided, however, that
nothing in this Agreement shall be deemed to constitute a waiver by the Bank of
its right of set off or any banker's lien with respect to any other account of
the Company.
Section 5. Payments to Be Made to Account. During any Applicable
Period, the Company shall direct each of its members and each other Person
obligated to make any payment to the Company of Pledged Revenues to make such
payments to the Bank at the address or in such other manner as specified in
Section 6 for deposit into the Lockbox Account. The Company agrees not to make,
cause or permit to be made any deposits of moneys other than Pledged Revenues
into the Lockbox Account. The Company shall use its best efforts to cause its
members and each other Person obligated to make any payment of Pledged Revenues
to make such payments in accordance with the provisions of this Agreement.
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Section 6. Manner of Payment.
(a) During any Applicable Period, payments of Pledged Revenues made
by mail shall be mailed to:
SunTrust Bank, Atlanta,
Attention: Corporate Trust Department
P. O. Box 4625
Atlanta, GA 30302
Reference: Oglethorpe Power Corporation Special Cash Account
or to such other address as may be specified by the Bank to the Company at least
thirty (30) days before the effective date of such change. During any Applicable
Period, electronic payments of Pledged Revenues shall be made in the following
manner:
SunTrust Bank, Atlanta,
Corporate Trust Department
Center 008
ABA #061000104
A/C 970100000000008
Attention: Bryan Echols
Ref: Oglethorpe Power Corporation
Special Cash Account
All such payments of Pledged Revenues shall be accompanied by such references or
other instructions to the Bank to deposit such payments in the Lockbox Account.
The Bank shall have no responsibility or liability for failing to deposit any
moneys in the Lockbox Account which are not accompanied by such references or
other instructions to deposit such moneys in such account.
(b) All such payments received by the Bank shall be deposited into
the Lockbox Account and held subject to the provisions hereof. The Bank is
hereby authorized, empowered and directed by the Company to deposit all funds
received as described in Section 6(a) into the Lockbox Account and to make all
necessary endorsements and to take all other necessary actions to carry out the
purposes of this Agreement. The Company hereby waives notice of presentment,
protest and non-payment of any instrument so endorsed.
(c) During any Applicable Period, the Company shall promptly, and no
event later than the Business Day following the receipt thereof, remit to the
Bank in accordance with Section 6(a) for deposit into the Lockbox Account any
Pledged Revenue that is received by the Company.
Section 7. Accounting. No less frequently than once each month, the
Bank shall deliver by mail a statement to the Company, with copies to the
Trustee, the RUS and such other
A-3
Persons as may be designated by the Company, which shall identify the date,
maker and amount of each deposit to the Lockbox Account, and the date, payee and
amount of each withdrawal or other debit to the Lockbox Account.
Section 8. Disbursements.
(a) Upon written demand of the Trustee, accompanied by a statement
that there has occurred and is continuing under the Indenture an Event of
Default, and continuing until such demand is rescinded, the Bank shall pay to
the Trustee all amounts then or thereafter on deposit in the Lockbox Account, to
be applied by the Trustee as provided under the Security Documents.
(b) So long as the Bank shall not have received a written demand
from the Trustee under paragraph (a), on the fifth (5th) Business Day preceding
the end of each month during the Applicable Period, the Bank shall withdraw and
pay (or deposit in another, unrestricted account, at the direction of the
appropriate party listed below) from the amounts on deposit in the Lockbox
Account the following amounts in the order indicated to the extent funds are
available in the Lockbox Account:
(1) to the Bank, the amount of fees and expenses that are then
payable to the Bank under Section 9;
(2) to the Trustee, the amount certified by the Trustee as the
amount of any fees or expenses that are then payable to the
Trustee under the Security Documents;
(3) to the Company, the amount specified in a Company Request as
the amount of ordinary and necessary payments due from the
Company for the following month, including, without
limitation, payments for operations and regularly scheduled
debt service;
(4) to the Trustee, the amount certified by the Trustee as the
amount necessary to provide for the payment of the principal
and interest then due or (based on receipt by the Trustee on a
monthly basis of a proportional amount of principal and
accrued interest) becoming due on the Outstanding Secured
Obligations during the following month, for deposit as Trust
Moneys under the Indenture;
(5) to the Company, the amount specified in a Company Request as
the amount of expenditures approved for the following month in
accordance with a capital expenditure budget approved by the
RUS;
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(6) to the Company, the amount specified in a Company Request as
the amount of expenditures for the following month approved in
writing by the RUS for other purposes; and
(7) to the payment of any amounts due under Obligations to
maintain the value of reserve funds established and maintained
in connection with debt securities (A) secured by a pledge of
certain Obligations, (B) issued on behalf of the Company and
(C) with respect to which and opinion was delivered on the
date of the issuance of such securities to the effect that the
interest on such securities is excluded from the gross income
of the holder of such securities pursuant to the Internal
Revenue Code, as amended.
(c) Any amounts remaining on deposit in the Lockbox Account on the
day following the end of the month in which (i) a Highest Oversight Period no
longer exists (as evidenced by an Officers' Certificate and a notice from the
RUS to such effect) or (ii) this Agreement terminates pursuant to Section 13,
shall be paid to the Company in accordance with, and upon receipt of, a Company
Request, to be used for any lawful purpose.
(d) Pending disbursements of the amounts on deposit in the Lockbox
Account, the Bank shall promptly invest and reinvest such amounts in the
Defeasance Securities specified in any Company Order or in such other
investments as may be approved in writing by the RUS.
(e) Any amounts deposited in the Lockbox Account that do not
constitute Pledged Revenues, as identified to the Bank in writing by either of
the RUS or the Trustee, shall be promptly paid to the Company (unless such error
is identified during any period described in paragraph (a), in which case such
amounts so identified shall be paid to the Trustee). The Company agrees to
promptly notify both of the Trustee and the RUS of any deposits into the Lockbox
Account of any amounts not constituting Pledged Revenues.
Section 9. Fees and Expenses of Bank. The Company agrees
(a) to pay to the Bank from time to time such compensation as may be
specifically agreed upon with the Bank and, absent specific agreement,
reasonable compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Bank upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Bank in accordance with any provision of this Agreement
(including the reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance as may be
attributable to the Bank's negligence or bad faith; and
A-5
(c) to indemnify the Bank for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
Agreement, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder.
All such payments and reimbursements shall be made with interest at the rate of
10% per annum.
Section 10. Certain Rights of Bank.
(a) The Bank undertakes to perform such duties and only such duties
as are specifically set forth in this Agreement and no implied covenants or
obligations shall be read into this Agreement against the Bank. The Bank makes
no representation or warranty as to the priority of any claim or the status, in
the event of any insolvency, bankruptcy or other similar proceeding affecting
the Company, of amounts held in the Lockbox Account or paid therefrom.
(b) In the absence of bad faith on its part, the Bank may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the
Bank and appearing to conform to the requirements of this Agreement. The Bank
shall have no liability for actions taken pursuant to this Agreement other than
as a result of its gross negligence or willful misconduct.
(c) The Bank may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order approval or other paper or
document believed by it to be genuine and to have been signed or presented by
the proper party or parties and shall not be required to verify the accuracy of
any information or calculations required to be included therein or attached
thereto. Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution
(d) Whenever in the administration of this Agreement, the Bank shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Bank (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate.
(e) The Bank may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon.
(f) The Bank may execute any of the powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys and shall
not be liable for the negligence or misconduct of such Persons appointed by the
Bank with due care hereunder.
A-6
(g) The Bank shall not be liable for any errors of judgment made in
good faith by it, unless it shall be proved that the Bank was grossly negligent
or reckless in ascertaining the pertinent facts.
(h) The Bank shall not be required to give any bond or suety in
respect of the execution of the obligations and trusts set forth in this
Agreement or otherwise in respect hereof or of the Lockbox Account.
Section 11. Trustee's Rights, Obligations, Etc. The rights, duties,
responsibilities and fees of the Trustee hereunder shall be governed by the
provisions of Article IX of the Indenture relating to the Trustee and the
indemnities provided for in the Indenture shall include all action by the
Trustee taken hereunder.
Section 12. Removal, Resignation, Etc. The Bank may resign at any
time upon thirty (30) days written notice to the Company, the Trustee and the
RUS. The Company may remove the Bank, with the written consent of the RUS, upon
thirty (30) days written notice to the Bank, the Trustee and the RUS. The RUS
may remove the Bank upon thirty (30) days written notice to the Bank, the
Company and the Trustee. Upon any such resignation or removal, the Company shall
select another financial institution, with the approval of the RUS, with which
to enter into a lockbox agreement substantially upon the terms contained in this
Agreement and otherwise upon such terms as shall be permitted or required by the
RUS. In the event the Company does not select a financial institution approved
by the RUS, the RUS shall select such financial institution.
Section 13. Amendments with Consent of the RUS. Even though this
Agreement establishes rights for the benefit of Holders of the Outstanding
Secured Obligations, the terms, conditions and requirements of this Agreement
are in addition to those found in the Indenture and have been required solely by
the RUS. Accordingly, this Agreement can be terminated, amended, modified or
supplemented in any way by the Company with the consent of only the RUS and
without the consent of the Bank, the Trustee or the Holders of the Outstanding
Secured Obligations; provided, however, that no amendment, modification or
supplement to the obligations or rights of the Bank or the Trustee, or otherwise
adversely affecting the Bank or the Trustee, shall be effective as to the Bank
or the Trustee without the prior written consent of the Bank or the Trustee, or
both, as the case may be. This Agreement shall automatically terminate on the
date on which the RUS is no longer a Holder of any Outstanding Secured
Obligation.
Section 14. Exculpation of the RUS. The RUS shall have no obligation
or liability to any party to this Agreement, any other Holder of an Outstanding
Secured Obligation or to any other Person for any action taken by it pursuant to
the terms of this Agreement or any failure to take action permitted to be taken
by it pursuant to this Agreement.
Section 15. Notices, etc., to Bank, Trustee, Company and RUS. Any
request, demand, authorization, direction, notice, consent, waiver or other
document provided or permitted by this Agreement to be made upon, given or
furnished to, or filed with
A-7
(a) the Trustee by the Company or the Bank shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or with
the Trustee at its principal corporate trust office, or
(b) the Company by the Trustee or the Bank shall be sufficient for
every purpose hereunder if in writing and mailed, first-class postage prepaid,
to the Company addressed to it at 2100 East Exchange Place, P.O. Box 1349,
Tucker, Georgia 30085-1349, Attention: President and Chief Executive Officer,
with a copy to Vice President, Finance, or at any other address furnished in
writing to the Trustee, the Bank and RUS by the Company, or
(c) the RUS by the Bank or the Company shall be sufficient for every
purpose hereunder if in writing and mailed, first-class postage prepaid, to the
RUS addressed to it at Rural Utilities Service, United States Department of
Agriculture, 1400 Independence Avenue, SW., Washington, D.C. 20250-1500,
Attention: Administrator or at any other address furnished in writing to the
Trustee, the Bank and the Company by the RUS, or
(d) the Bank by the Trustee, the RUS or the Company shall be
sufficient for every purpose hereunder if in writing and mailed, first-class
postage pre-paid, to the Bank addressed to it at:
Street Address: Mailing Address:
--------------- ----------------
SunTrust Bank, Atlanta SunTrust Bank, Atlanta
Corporate Trust Department Corporate Trust Department
58 Edgewood Avenue P. O. Box 4625
Room 400 Atlanta, Georgia 30302
Atlanta, Georgia 30303
or at any other address furnished in writing to the Trustee, the RUS and the
Company by the Bank.
Section 16. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
Section 17. Successors and Assigns. All covenants and agreements in
this Agreement by the parties hereto shall bind their respective successors and
assigns, whether so expressed or not.
Section 18. Severability Clause. In case any provision in this
Agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 19. Benefits of Agreement. The RUS is an express third-party
beneficiary of the Company's and the Bank's obligations under this Agreement.
Nothing in this Agreement, express or implied, shall give to any Person, other
than the parties hereto, the RUS and their
A-8
successors hereunder and any separate trustee or co-trustee appointed under
Section 9.14 of the Indenture, any benefit or any legal or equitable right,
remedy or claim under this Agreement.
Section 20. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Georgia.
Section 21. Counterparts. This Agreement may be executed in any
number of counterparts, each of which so executed to be an original, but all
such counterparts shall together constitute but one and the same instrument.
Section 22. Specific Performance. Each of the Trustee and the RUS is
hereby, to the maximum extent permitted by applicable law, to demand specific
performance of this Agreement at any time when the Company shall have failed to
comply with any provision of this Agreement applicable to it. The Company hereby
irrevocably waives, to the maximum extent permitted by applicable law, any
defense based on the adequacy of a remedy at law that might be asserted as a bar
to such remedy of specific performance.
Section 23. Waiver. No failure on the part of the Trustee, the Bank
or the RUS to exercise, and no delay in exercising, any right hereunder, under
the Security Documents or under the Loan Contract, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder or
thereunder preclude any other or further exercise thereof. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 24. Further Assurances. The Company agrees, at the cost and
expense of the Company, to execute and deliver and file and record such further
documents or instruments as the Trustee, the RUS or the Bank may reasonably
request in order to carry out or confirm the respective rights of the Trustee,
the RUS and the Bank under this Agreement.
Section 25. Entire Agreement. This written Agreement represents the
final agreement between the parties and may not be contradicted by evidence of
prior, contemporaneous, or subsequent oral agreements of the parties. There are
no unwritten oral agreements between parties.
[Signatures on next page.]
A-9
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SUNTRUST BANK, ATLANTA,
as Lockbox Bank
By:_______________________________________
Name:__________________________________
Title:_________________________________
By:_______________________________________
Name:__________________________________
Title:_________________________________
OGLETHORPE POWER CORPORATION
(AN ELECTRIC MEMBERSHIP GENERATION
& TRANSMISSION CORPORATION)
By:_______________________________________
Name: T. D. Kilgore
Title: President and Chief Executive Officer
SUNTRUST BANK, ATLANTA,
as Trustee under the Indenture identified herein
By:_______________________________________
Name:__________________________________
Title:_________________________________
By:_______________________________________
Name:__________________________________
Title:_________________________________
A-10
FFB RETAINED INDEBTEDNESS NOTE
FOR FFB USE ONLY: RUS Note No._________________________
Note Identifier: Dated as of March 1, 1997
-------------
OGLETHRP 0012 Principal amount $2,637,781,327.45
(subject to increases, as provided
Acceptance Date: in Part I, paragraph 13, of this
Note)
Latest maturity date of any debt
under this Note January 2, 2024
Executed at Tucker, Georgia
Security Instrument (referred to in Part IV,
paragraph 7, of this Note): Indenture and
Security Agreement, each dated as of March 1,
1997, and each made by Oglethorpe Power
Corporation (An Electric Membership
Generation and Transmission Corporation),
Grantor, to SunTrust Bank, Atlanta, Trustee.
RETAINED INDEBTEDNESS NOTE
PART I
DESCRIPTION OF RETAINED INDEBTEDNESS NOTE
1. Retained Indebtedness Note to Evidence Indebtedness for which Oglethorpe
Power Corporation Remains Liable after Georgia Transmission Corporation's
Assumption of a 16.864 Percent Portion of Indebtedness Evidenced by
Oglethorpe Power Corporation's Outstanding Notes.
This Retained Indebtedness Note is executed and delivered to evidence (a)
the present obligations of OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP
GENERATION AND TRANSMISSION CORPORATION) (the "Borrower"), a corporation
organized and existing under the laws of the State of Georgia, to the FEDERAL
FINANCING BANK ("FFB") remaining after the assumption by Georgia Transmission
Corporation (An Electric Membership Corporation) ("GTC"), a corporation
organized and existing under the laws of the State of Georgia, of a 16.864
percent portion of the indebtedness that is presently owed by the Borrower to
FFB on account of certain advances of funds previously made by FFB that are
outstanding on the date hereof and evidenced on the date hereof by those certain
promissory notes payable to FFB
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 1
Part I
previously executed and delivered by the Borrower, which notes are more
particularly described on the list of notes attached hereto as Annex 1 (each
note listed on Annex 1, as such note may have been amended, being an
"Outstanding Note," all such notes being, collectively, the "Outstanding Notes",
the indebtedness of the Borrower presently owed to FFB on account of each
advance of funds previously made by FFB that is outstanding on the date hereof
and evidenced on the date hereof by an outstanding Note being an "Outstanding
Note Advance", and the indebtedness of the Borrower presently owed to FFB on
account of more than one such advance of funds being, collectively, "Outstanding
Note Advances"), and (b) certain obligations of the Borrower to the
Administrator of the Rural Utilities Service ("RUS"), successor to the
Administrator of the Rural Electrification Administration ("REA"), remaining
after the assumption by the GTC of a 16.864 percent portion of the obligations
of the Borrower to the Administrator of RUS relating to such assumed
indebtedness.
2. Advance Portions Governed by Part IIA ("Retained Old Form Note Advance
Portions").
(a) Five of the Outstanding Notes were purchased by FFB under an agreement
dated as of August 14, 1974, between FFB and REA, as such agreement was amended
from time to time prior to January 28, 1983 (each such Outstanding Note being an
"Old Form Note", and all five of such Outstanding Notes being, collectively, the
"Old Form Notes"). Each of these Old Form Notes has previously been modified,
respectively, by an agreement among the Borrower, FFB, and REA which established
the procedures for the Borrower to elect to have a new interest rate apply to
any Outstanding Note Advance that was evidenced on the date of such modification
agreement by an Old Form Note and was outstanding more than 12 years after the
end of the calendar year in which such Outstanding Note Advance was made (any
election to have a new interest rate apply to any such Outstanding Note Advance
being a "repricing" of such outstanding Note Advance, and any modification
agreement establishing the procedures for repricing any such outstanding Note
Advances being a "Repricing Agreement"). Certain of the Outstanding Note
Advances that are evidenced on the date hereof by an Old Form Note that has been
modified by a Repricing Agreement have not been repriced as of the date hereof
under such Repricing Agreement (each such outstanding Note Advance being an "Old
Form Note Advance", and more than one such Outstanding Note Advance being,
collectively, "Old Form Note Advances"). Effective as of the date of this
Retained Indebtedness Note, GTC assumes a 16.864 percent portion
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 2
Part I
of each Old Form Note Advance (the 16.864 percent portion of each Old Form Note
Advance, which portion is assumed by GTC as of the date hereof, being an
"Assumed Old Form Note Advance Portion"), leaving the residual 83.136 percent
portion of each Old Form Note Advance remaining owed by the Borrower to FFB (the
83.136 percent portion of each Old Form Note Advance, which portion remains owed
by the Borrower to FFB, being a "Retained Old Form Note Advance Portion", and
all of such percent portions remaining owed by the Borrower to FFB being,
collectively, the "Retained Old Form Note Advance Portions"). Upon execution by
RUS of the guarantee set forth at the end of this Retained Indebtedness Note,
the Borrower shall be released from any and all liability for each Assumed Old
Form Note Advance Portion, and each Retained Old Form Note Advance Portion shall
be evidenced by this Retained Indebtedness Note. Subject to the exercise of the
refinancing election provided in paragraph 6 of this Part I, the terms of Part
IIA of this Retained Indebtedness Note shall govern each Retained Old Form Note
Advance Portion. The Retained Old Form Note Advance Portions are more
particularly described in the advance schedules collectively attached hereto as
Annex 2A (any advance schedule constituting a part of Annex 2A being a "Retained
Old Form Note Advance Portion Schedule," and all of such advance schedules
being, collectively, the "Retained Old Form Note Advance Portion Schedules").
(b) The Refinancing Note dated as of March 31, 1994, is one of the
Outstanding Notes and was accepted by FFB in substitution for a promissory note
payable to FFB that was previously executed and delivered by the Borrower,
purchased by FFB under an agreement dated as of August 14, 1974, between FFB and
REA, as such agreement was amended from time to time prior to January 28, 1983,
and modified by a Repricing Agreement among the Borrower, FFB, and REA (the
Outstanding Note so accepted being the "Refinancing Note"). The Refinancing Note
established the procedures for the Borrower to elect to refinance under section
306C of the Rural Electrification Act of 1936, as amended (7 U.S.C. ss. 936c)
(the "Refinancing Authority"), any Outstanding Note Advance that was evidenced
on the date of the Refinancing Note by the Refinancing Note. Certain Outstanding
Note Advances that are evidenced on the date hereof by the Refinancing Note and
identified in the Refinancing Note as being "Old Form Note Advances" have not
been refinanced as of the date hereof under the Refinancing Authority (each such
Outstanding Note Advance being included within the term "Old Form Note Advance",
and all of such Outstanding Note Advances being collectively included within the
term "Old Form Note Advances"). Effective as of the
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 3
Part I
date of this Retained Indebtedness Note, GTC assumes a 16.864 percent portion of
each such Old Form Note Advance (the 16.864 percent portion of each such Old
Form Note Advance, which portion is assumed by GTC as of the date hereof, being
included within the term "Assumed Old Form Note Advance Portion"), leaving the
residual 83.136 percent portion of each such Old Form Note Advance remaining
owed by the Borrower to FFB (the 83.136 percent portion of each such Old Form
Note Advance, which portion remains owed by the Borrower to FFB, being included
within the term "Retained Old Form Note Advance Portion", and all of such
percent portions remaining owed by the Borrower to FFB being collectively
included within the term "Retained Old Form Note Advance Portions"). Upon
execution by RUS of the guarantee set forth at the end of this Retained
Indebtedness Note, the Borrower shall be released from any and all liability for
each such Assumed Old Form Note Advance Portion, and each such Retained Old Form
Note Portion shall be evidenced by this Retained Indebtedness Note. Subject to
the exercise of the refinancing election provided in paragraph 6 of this Part I,
the terms of Part IIA of this Retained Indebtedness Note shall also govern each
such Retained Old Form Note Advance Portion. Such Retained Old Form Note Advance
Portions are more particularly described in advance schedules that are included
among the Retained Old Form Note Advance Portion Schedules attached hereto as
Annex 2A.
3. Advance Portions Governed by Part IIB ("Retained Repriced Old Form Note
Advance Portions").
Certain of the Outstanding Note Advances that are evidenced on the date
hereof by an Old Form Note that has been modified by a Repricing Agreement have
been repriced prior to the date hereof under a Repricing Agreement (each such
Outstanding Note Advance being a "Repriced Old Form Note Advance", and more than
one such Outstanding the Borrower Advance being, collectively, "Repriced Old
Form Note Advances"). Effective as of the date of this Retained Indebtedness
Note, GTC assumes a 16.864 percent portion of each Repriced Old Form Note
Advance (the 16.864 percent portion of each Repriced Old Form Note Advance,
which portion is assumed by GTC as of the date hereof, being an "Assumed
Repriced Old Form Note Advance Portion"), leaving the residual 83.136 percent
portion of each Repriced Old Form Note Advance remaining owed by the Borrower to
FFB (the 83.136 percent portion of each Repriced Old Form Note Advance, which
portion remains owed by the Borrower to FFB, being a "Retained Repriced Old Form
Note Advance Portion", and all of such percent portions remaining owed by the
Borrower to FFB being, collectively, the "Retained Repriced Old
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 4
Part I
Form Note Advance Portions"). Upon execution by RUS of the guarantee set forth
at the end of this Retained Indebtedness Note, the Borrower shall be released
from any and all liability for each Assumed Repriced Old Form Note Advance
Portion, and each Retained Repriced Old Form Note Advance Portion shall be
evidenced by this Retained Indebtedness Note. Subject to the exercise of the
refinancing election provided in paragraph 6 of this Part I, the terms of Part
IIB of this Retained Indebtedness Note shall govern each Retained Repriced Old
Form Note Advance Portion. The Retained Repriced Old Form Note Advance Portions
are more particularly described in the advance schedules collectively attached
hereto as Annex 2B (any advance schedule constituting a part of Annex 2B being a
"Retained Repriced Old Form Note Advance Portion Schedule," and all of such
advance schedules being, collectively, the "Retained Repriced Old Form Note
Advance Portion Schedules").
4. Advance Portions Governed by Part IIC ("Retained New Form Note Advance
Portions").
(a) Four of the Outstanding Notes were purchased by FFB under an agreement
dated as of January 28, 1983, between FFB and REA, as such agreement was amended
and restated from time to time prior to January 1, 1992 (each such Outstanding
Note being an "New Form Note", and all four of such Outstanding Notes being,
collectively, the "New Form Notes"). Certain of the Outstanding Note Advances
are evidenced on the date hereof by the New Form Notes (each such Outstanding
Note Advance being a "New Form Note Advance", and more than one such Outstanding
Note Advance being, collectively, "New Form Note Advances"). Effective as of the
date of this Retained Indebtedness Note, GTC assumes a 16.864 percent portion of
each New Form Note Advance (the 16.864 percent portion of each New Form Note
Advance, which portion is assumed by GTC as of the date hereof, being an
"Assumed New Form Note Advance Portion"), leaving the residual 83.136 percent
portion of each New Form Note Advance remaining owed by the Borrower to FFB (the
83.136 percent portion of each New Form Note Advance, which portion remains owed
by the Borrower to FFB, being a "Retained New Form Note Advance Portion", and
all of such percent portions remaining owed by the Borrower to FFB being,
collectively, the "Retained New Form Note Advance Portions"). Upon execution by
RUS of the guarantee set forth at the end of this Retained Indebtedness Note,
the Borrower shall be released from any and all liability for each Assumed New
Form Note Advance Portion, and each Retained New Form Note Advance Portion shall
be evidenced by this Retained Indebtedness Note. Subject to the exercise of the
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 5
Part I
refinancing election provided in paragraph 6 of this Part I, the terms of Part
IIC of this Retained Indebtedness Note shall govern each Retained New Form Note
Advance Portion. The Retained New Form Note Advance Portions are more
particularly described in the advance schedules collectively attached hereto as
Annex 2C (any advance schedule constituting a part of Annex 2C being a "Retained
New Form Note Advance Portion Schedule," and all of such advance schedules
being, collectively, the "Retained New Form Note Advance Portion Schedules").
(b) Certain of the Outstanding Note Advances that are evidenced on the
date hereof by the Refinancing Note and identified in the Refinancing Note as
being "Substitute Note Advances" have not been refinanced as of the date hereof
under the Refinancing Authority (each such Outstanding Note Advance being
included within the term "New Form Note Advance", and all of such Outstanding
Note Advances being collectively included within the term "New Form Note
Advances"). Effective as of the date of this Retained Indebtedness Note, GTC
assumes a 16.864 percent portion of each such New Form Note Advance (the 16.864
percent portion of each such New Form Note Advance, which portion is assumed by
GTC as of the date hereof, being included within the term "Assumed New Form Note
Advance Portion"), leaving the residual 83.136 percent portion of each such New
Form Note Advance remaining owed by the Borrower to FFB (the 83.136 percent
portion of each such New Form Note Advance, which portion remains owed by the
Borrower to FFB, being included within the term "Retained New Form Note Advance
Portion", and all of such percent portions remaining owed by the Borrower to FFB
being collectively included within the term "Retained New Form Note Advance
Portions"). Upon execution by RUS of the guarantee set forth at the end of this
Retained Indebtedness Note, the Borrower shall be released from any and all
liability for each such Assumed New Form Note Advance Portion, and each such
Retained New Form Note Portion shall be evidenced by this Retained Indebtedness
Note. Subject to the exercise of the refinancing election provided in paragraph
6 of this Part I, the terms of Part IIC of this Retained Indebtedness Note shall
also govern each such Retained New Form Note Advance Portion. Such Retained New
Form Note Advance Portions are more particularly described in advance schedules
that are included among the Retained New Form Note Advance Portion Schedules
attached hereto as Annex 2C.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 6
Part I
5. Advance Portions Governed by Part IID ("Retained Refinanced Refinancing
Note Advance Portions").
Certain of the Outstanding Note Advances that are evidenced on the date
hereof by the Refinancing Note have been refinanced prior to the date hereof
under the Refinancing Authority (each such Outstanding Note Advance being a
"Refinanced Refinancing Note Advance", and all of such Outstanding Note Advances
being, collectively, the "Refinanced Refinancing Note Advances"). Effective as
of the date of this Retained Indebtedness Note, GTC assumes a 16.864 percent
portion of each Refinanced Refinancing Note Advance (the 16.864 percent portion
of each Refinanced Refinancing Note Advance, which portion is assumed by GTC as
of the date hereof, being an "Assumed Refinanced Refinancing Note Advance
Portion"), leaving the residual 83.136 percent portion of each Refinanced
Refinancing Note Advance remaining owed by the Borrower to FFB (the 83.136
percent portion of each Refinanced Refinancing Note Advance, which portion
remains owed by the Borrower to FFB, being a "Retained Refinanced Refinancing
Note Advance Portion", and all of such percent portions remaining owed by the
Borrower to FFB being, collectively, the "Retained Refinanced Refinancing Note
Advance Portions"). Upon execution by RUS of the guarantee set forth at the end
of this Retained Indebtedness Note, the Borrower shall be released from any and
all liability for each Assumed Refinanced Refinancing Note Advance Portion, and
each Retained Refinanced Refinancing Note Advance Portion shall be evidenced by
this Retained Indebtedness Note. Subject to the exercise of the refinancing
election provided in paragraph 6 of this Part I, the terms of Part IID of this
Retained Indebtedness Note shall govern each Retained Refinanced Refinancing
Note Advance Portion. The Retained Refinanced Refinancing Note Advance Portions
are more particularly described in the advance schedules collectively attached
hereto as Annex 2D (any advance schedule constituting a part of Annex 2D being a
"Retained Refinanced Refinancing Note Advance Portion Schedule," and all of such
advance schedules being, collectively, the "Retained Refinanced Refinancing Note
Advance Portion Schedules").
6. Refinancing Election.
For so long as the Refinancing Authority shall be in effect, and subject
to the terms and conditions of this Part I, the Borrower may elect to refinance
the unpaid principal balance of any Retained Old Form Note Advance Portion, the
unpaid principal balance of any Retained Repriced Old Form Note Advance Portion,
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 7
Part I
the unpaid principal balance of any Retained New Form Note Advance Portion or
the unpaid principal balance of any Retained Refinanced Refinancing Note Advance
Portion (any such Retained Old Form Note Advance Portion, Retained Repriced Old
Form Note Advance Portion, Retained New Form Note Advance Portion or Retained
Refinanced Refinancing Note Advance Portion being a "Retained Advance Portion,"
and more than one such Retained Old Form Advance Portion, Retained Repriced Old
Form Note Advance Portion, Retained New Form Note Advance Portion or Retained
Refinanced Refinancing Note Advance Portion being, collectively, "Retained
Advance Portions"), and have the terms of Part III of this Retained Indebtedness
Note govern such Retained Advance Portion (any such an election being a
"Refinancing Election").
7. Refinancing Premium.
In connection with a Refinancing Election made with respect to any
Retained Advance Portion, the Borrower shall pay to FFB a premium (a
"Refinancing Premium") in the amount required by the terms of the Refinancing
Authority. Such Refinancing Premium shall be calculated by the Secretary of the
Treasury as of the close of business 2 "Business Days" (as that term is defined
in the next succeeding sentence) prior to the "Refinancing Effective Date" (as
that term is defined in paragraph 14 of this Part I) using standard calculation
methods of the United States Department of the Treasury. For purposes of this
Retained Indebtedness Note, the term "Business Day" means any day on which both
FFB and the Federal Reserve Bank of New York are open for business.
8. Election to Finance the Premium.
For so long as the Refinancing Authority shall be in effect, and subject
to the terms and conditions of this Part I, the Borrower may, in connection with
a Refinancing Election made with respect to any Retained Advance Portion, elect
to pay the applicable Refinancing Premium to FFB by increasing the outstanding
principal balance of the respective Retained Advance Portion by the amount of
the applicable Refinancing Premium, as calculated by the Secretary of the
Treasury (any such election being an "Election to Finance the Premium"). The new
indebtedness incurred by the Borrower in connection with an Election to Finance
the Premium made with respect to any Retained Advance Portion shall have the
same maturity date, principal payment schedule, and interest rates as the
respective Retained Advance Portion shall have after it has been refinanced.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 8
Part I
9. Conditions to Refinancing Election.
The terms of Part III of this Retained Indebtedness Note shall begin to
govern a Retained Advance Portion if and when all of the following conditions
shall have been satisfied:
(a) the Borrower shall have delivered to RUS a notice, in the form of
notice attached hereto as Annex 3, that the Borrower makes a Refinancing
Election with respect to a Retained Advance Portion (each such notice being an
"Election Notice"), which notice shall:
(1) identify the Retained Advance Portion with respect to which the
Borrower makes a Refinancing Election;
(2) specify the date on which the Borrower requests that the
refinancing of the unpaid principal balance of such Retained Advance
Portion become effective, being also the date on which the terms of Part
III of this Retained Indebtedness Note shall begin to govern such Retained
Advance Portion (such date being the "Requested Effective Date"), which
date:
(A) in the case of every Election Notice, may be either any
Business Day occurring during the first 2 months of any calendar
quarter or the last day of any calendar quarter (the last day of
each calendar quarter being a "Payment Date"); and
(B) in the case of the first Election Notice, shall also be
not earlier than 5 Business Days after FFB has delivered notice to
RUS that this Retained Indebtedness Note has been accepted by FFB;
(3) specify the new maturity date for such Retained Advance Portion,
selected in accordance with the principles of paragraph 3 of Part III of
this Retained Indebtedness Note;
(4) specify the method for the payment of the principal of such
Retained Advance Portion, selected from among the options provided in
paragraph 6 of Part III of this Retained Indebtedness Note; and
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 9
Part I
(5) state whether the Borrower makes an Election to Finance the
Premium with respect to such Retained Advance Portion;
(b) RUS shall have completed processing the Borrower's Refinancing
Election and, if made, the Borrower's Election to Finance the Premium;
(c) FFB shall have received from RUS not less than 5 Business Days prior
to the respective Requested Effective Date a notice, in the form of notice
prescribed by FFB, that RUS has completed processing of the Borrower's
Refinancing Election and, if made, the Borrower's Election to Finance the
Premium (any such notice being an "Election Processing Completion Notice"); and
(d) the Borrower shall have tendered to FFB, not later than 3:00 p.m.
(Washington, D.C., time) on the respective Requested Effective Date:
(1) for each Retained Advance Portion with respect to which the
Borrower does not make an Election to Finance the Premium, the sum of:
(A) the amount of the Refinancing Premium that is required by
the terms of the Refinancing Authority in connection with
refinancing such Retained Advance Portion; plus
(B) the accrued interest through the Requested Effective Date;
and
(2) for each Retained Advance Portion with respect to which the
Borrower makes an Election to Finance the Premium, the accrued interest
through the Requested Effective Date.
10. Condition to Election to Finance the Premium.
For each Retained Advance Portion with respect to which the Borrower makes
an Election to Finance the Premium, the Borrower shall be permitted to pay the
applicable Refinancing Premium to FFB by increasing the outstanding principal
balance of such Retained Advance Portion if the Borrower tenders to RUS, not
later than 3:00 p.m. (Washington, D.C., time) on the Requested Effective Date,
an amount equal to 2.5 percent of the applicable Refinancing Premium.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 10
Part I
11. Borrower's Agreement Regarding Election Process Completion Notices.
The Borrower hereby agrees that FFB, for its purposes, may consider any
Election Processing Completion Notice delivered by RUS to FFB in accordance with
Part I of this Retained Indebtedness Note to be an accurate representation that
the Borrower has made a Refinancing Election with respect to the particular
Retained Advance Portion identified therein and evidence that RUS has completed
processing that Refinancing Election.
12. Retained Advance Portions Governed by Part III.
If the Borrower makes a Refinancing Election with respect to any Retained
Advance Portion, and all of the conditions that apply to making such Refinancing
Election are satisfied, then the terms of Part III of this Retained Indebtedness
Note shall govern such Retained Advance Portion from and after the Refinancing
Effective Date, and a new interest rate and fee, established in accordance with
the principles of paragraph 4 of Part III of this Retained Indebtedness Note,
shall apply to such Retained Advance Portion from and after such Refinancing
Effective Date.
13. Increases in the Principal Amount of Retained Advance Portions Governed by
Part III due to Elections to Finance the Premium.
If, in connection with a Refinancing Election made with respect to any
Retained Advance Portion, the Borrower makes an Election to Finance the Premium,
and the condition that applies to making such Election to Finance the Premium is
satisfied, then the outstanding principal balance of the respective Retained
Advance Portion shall be increased, as of the Refinancing Effective Date, by the
amount of the applicable Refinancing Premium, by operation of the Refinancing
Authority.
14. Refinancing Effective Date.
If an Election Processing Completion Notice is received by FFB at least 5
Business Days prior to the Requested Effective Date specified by the Borrower in
the respective Election Notice, and all of the other conditions that apply to
making such Refinancing Election are satisfied, then the refinancing shall
become effective, and the terms of Part III of this Retained Indebtedness Note
shall begin to govern the respective Retained
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 11
Part I
Advance Portion, on such Requested Effective Date (in such event, the Requested
Effective Date being the "Refinancing Effective Date"). If an Election
Processing Completion Notice is not received by FFB at least 5 Business Days
prior to the respective Requested Effective Date, but all of the other
conditions that apply to making such Refinancing Election are satisfied, then
the refinancing shall become effective, and the terms of Part III of this
Retained Indebtedness Note shall begin to govern the respective Retained Advance
Portion, on the fifth Business Day after the day on which FFB receives such
Election Processing Completion Notice (in such event, the fifth Business Day
after the day on which FFB receives such Election Processing Completion Notice
being the "Refinancing Effective Date"); provided that the Borrower shall have
tendered to FFB, in addition to the payment required under subparagraph (d) of
paragraph 9 of this Part I, the interest accrued from the Requested Effective
Date through such Refinancing Effective Date.
15. Rescissions of Refinancing Elections.
The Borrower may rescind a Refinancing Election made with respect to any
Retained Advance Portion only in accordance with the provisions of this
paragraph 15. For a rescission of a Refinancing Election to be effective, both
FFB and RUS must have received from the Borrower, not later than 3:30 p.m.
(Washington, D.C., time) 2 Business Days prior to the respective Requested
Effective Date, a written notice specifying the Retained Advance with respect to
which the Borrower wishes to rescind a Refinancing Election. The written
rescission notice may be delivered by facsimile transmission to FFB at (202)
622-0707, and to RUS at (202) 720-1401, or at such other facsimile number or
numbers as FFB and RUS may from time to time communicate to the Borrower. In
specifying a Retained Advance Portion with respect to which the Borrower wishes
to rescind a Refinancing Election, the Borrower must recite in the written
rescission notice both the FFB identifier for such Retained Advance Portion (as
set out in the respective advance schedule for such Retained Advance Portion
attached hereto) and the RUS account number for such Retained Advance Portion.
16. Late Charges for Late Tenders of Payments Required in connection with
Refinancing Elections.
If the Borrower makes a Refinancing Election with respect to any Retained
Advance Portion, does not rescind such Refinancing Election in accordance
paragraph 15 of this Part I, and does not
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 12
Part I
tender, before 3:00 p.m. (Washington, D.C., time) on the respective Refinancing
Effective Date:
(a) to FFB, the applicable amount prescribed by subparagraph (d) of
paragraph 9 of this Part I;
(b) to FFB, if applicable, the amount prescribed by the last sentence of
paragraph 14 of this Part I; and
(c) to RUS, if the Borrower makes an Election to Finance the Premium, the
amount prescribed by paragraph 10 of this Part I;
then interest shall accrue on such unpaid amounts from the Refinancing Effective
Date to the actual date on which payment is made, computed in accordance with
the principles of paragraph 8 of Part III of this Retained Indebtedness Note.
17. Amount Due on First Payment Date After Effective Date.
For each Retained Advance Portion with respect to which the Borrower makes
a Refinancing Election, the amount that is due and payable on the first Payment
Date to occur after the Refinancing Effective Date for such Retained Advance
Portion shall be an amount that is equal to a full quarterly payment, as such
quarterly payments shall have been recalculated to take into account the method
of payment of principal selected by the Borrower from among the options provided
in paragraph 6 of Part III of this Retained Indebtedness Note and the new
interest rate and the applicable fee that shall apply to such Retained Advance
Portion determined in accordance with the principles of paragraph 4 of Part III
of this Retained Indebtedness Note. The Borrower acknowledges that if the
Borrower makes a Refinancing Election with respect to any Retained Advance
Portion and elects the level debt service method for the payment of the
principal of such Retained Advance Portion, the quarterly payment due on the
first Payment Date to occur after the Refinancing Effective Date for such
Retained Advance Portion may be comprised substantially of principal, since the
Borrower shall have paid, on the Refinancing Effective Date for such Retained
Advance Portion, the interest accrued on such Retained Advance Portion through
such Refinancing Effective Date.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 13
PART IIA
TERMS APPLICABLE TO
RETAINED OLD FORM NOTE ADVANCE PORTIONS
1. Promise to Pay.
FOR VALUE RECEIVED, the Borrower (which term includes any successors or
assigns) promises to pay FFB (which term includes any successors or assigns) at
the time, in the manner, and with interest at the rates hereinafter provided,
the principal amount of the Retained Old Form Note Advance Portions more
particularly described in the Retained Old Form Note Advance Portion Schedules
attached hereto as Annex 2A.
2. Principal Amount of Retained Old Form Note Advance Portions.
The principal amount of each Retained Old Form Note Advance Portion shall
be the amount specified on the respective Retained Old Form Note Advance Portion
Schedule as being the principal amount of such Retained Old Form Note Advance
Portion.
3. Maturity Dates.
Each Retained Old Form Note Advance Portion shall mature on the date
specified on the respective Retained Old Form Note Advance Portion Schedule as
being the maturity date for such Retained Old Form Note Advance Portion (such
date being the "Final Maturity Date" for such Retained Old Form Note Advance
Portion).
4. Applicable Interest Rate; Computation of Interest.
The interest rate applicable to each Retained Old Form Note Advance
Portion shall be the rate specified on the respective Retained Old Form Note
Advance Portion Schedule as being the interest rate for such Retained Old Form
Note Advance Portion. Interest on each Retained Old Form Note Advance Portion
shall accrue from December 31, 1996, to the date on which the principal amount
of such Retained Old Form Note Advance Portion is paid. Interest on each
Retained Old Form Note Advance Portion shall be computed on the basis of (a)
actual days elapsed from (but not including) December 31, 1996, to (and
including) the date on which payment is due, and (b) a year of 365 days (except
in calendar years including February 29, when the basis shall be a 366-day
year).
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 14
Part IIA (Retained Old Form Note Advance Portions)
5. Payment Of Interest.
The interest accrued on each Retained Old Form Note Advance Portion shall
be due and payable on each Payment Date, commencing on the first Payment Date to
occur after the effective date of this Retained Indebtedness Note up through and
including the Final Maturity Date for such Retained Old Form Note Advance
Portion. The amount of accrued interest on each Retained Old Form Note Advance
Portion that shall be due and payable on each such Payment Date shall be the
amount specified on the respective Retained Old Form Note Advance Portion
Schedule as being the amount of accrued interest due and payable on such Payment
Date.
6. Payment of Principal.
The principal amount of each Retained Old Form Note Advance Portion shall
be payable in installments on each Payment Date, commencing on the first Payment
Date to occur after the effective date of this Retained Indebtedness Note up
through and including the Final Maturity Date for such Retained Old Form Note
Advance Portion. The amount of principal of each Retained Old Form Note Advance
Portion that shall be due and payable on each such Payment Date shall be the
amount of principal specified on the respective Retained Old Form Note Advance
Portion Schedule as being the amount of principal due and payable on such
Payment Date.
7. Business Days.
Whenever any Payment Date or the respective Final Maturity Date for any
Retained Old Form Note Advance Portion shall fall on a day which is not a
Business Day, the payment that would otherwise be due on such Payment Date or
Final Maturity Date shall be due on the first Business Day thereafter.
8. Final Due Date.
Notwithstanding anything in this Retained Indebtedness Note to the
contrary, all amounts outstanding under this Retained Indebtedness Note on
account of each Retained Old Form Note Advance Portion, which amounts remain
unpaid as of the Final Maturity Date for such Retained Old Form Note Advance
Portion, shall be due and payable on the Final Maturity Date for such Retained
Old Form Note Advance Portion.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 15
Part IIA (Retained Old Form Note Advance Portions)
9. Application of Payments.
Each payment made on any Retained Old Form Note Advance Portion shall be
applied first to the payment of interest and then on account of principal.
10. Prepayments.
(a) For so long as the Refinancing Authority shall be in effect, the
Borrower may elect to prepay all or any portion of the unpaid principal balance
of any Retained Old Form Note Advance Portion in accordance with the terms of
the Refinancing Authority, in the manner, at the price, and subject to the
limitations as next described:
(1) The Borrower shall deliver to FFB written notification of such
prepayment election not less than 5 Business Days prior to the proposed
date of prepayment and, if less than the total outstanding principal
amount of such Retained Old Form Note Advance Portion is to be prepaid,
the Borrower shall specify in such notification the amount that is
proposed to be prepaid (any amount of any Retained Advance Portion that is
less than the total outstanding principal amount of the respective
Retained Advance Portion being a "Portion").
(2) The Borrower shall pay to FFB, at the time of prepayment of all
or any Portion of any Retained Old Form Note Advance Portion, the
outstanding principal amount of such Retained Old Form Note Advance
Portion or the Portion thereof to be prepaid, all accrued interest thereon
through the date of prepayment, plus the prepayment premium required by
the terms of the Refinancing Authority. The amount of each such prepayment
premium shall be calculated by the Secretary of the Treasury as of the
close of business 2 Business Days prior to the date of the proposed
prepayment, using standard calculation methods of the United States
Department of the Treasury.
(3) If the Borrower elects to prepay a Portion of a Retained Old
Form Note Advance Portion, the prepayment price paid shall be applied,
first, to interest accrued on such Portion of the Retained Old Form Note
Advance Portion to the date of prepayment and, then, to principal
installments in the inverse order of maturity. Following the prepayment of
a Portion of a Retained Old Form Note Advance Portion,
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 16
Part IIA (Retained Old Form Note Advance Portions)
subsequent payments shall continue to be made in the amounts specified in
the respective Retained Old Form Note Advance Portion Schedule, and such
payments shall be allocated by FFB between outstanding principal and
accrued interest, as appropriate, until the entire principal amount of
such Retained Old Form Note Advance Portion, and all interest accrued
thereon, is paid.
(4) Any prepayment of a Portion of a Retained Old Form Note Advance
Portion shall, as to the principal amount of such Portion, be subject to a
minimum amount equal to $100,000.00 of principal.
(b) In the event that the Refinancing Authority shall no longer be in
effect, the Borrower may pay all or any Portion of any Retained Old Form Note
Advance Portion at any time later than (but not before) 12 years after the end
of the year in which the respective Retained Old Form Note Advance Portion was
made, upon payment of a prepayment premium determined in accordance with this
subparagraph (b), but so long as there shall be any unpaid principal balance,
the Borrower shall be obligated to make the quarterly payments in the amounts
specified in the respective Retained Old Form Note Advance Portion Schedule. The
prepayment premium shall be an amount equal to 100 percent of the amount of
interest for 1 year on the unpaid principal balance of the respective Retained
Old Form Note Advance Portion or Portion thereof proposed to be prepaid,
multiplied by the ratio which the number of Payment Dates between the proposed
prepayment date and the Final Maturity Date for the respective Retained Old Form
Note Advance Portion bears to the number of Payment Dates between the first
prepayment date permitted by this paragraph 10 and such Final Maturity Date.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 17
PART IIB
TERMS APPLICABLE TO
RETAINED REPRICED OLD FORM NOTE ADVANCE PORTIONS
1. Promise to Pay.
FOR VALUE RECEIVED, the Borrower (which term includes any successors or
assigns) promises to pay FFB (which term includes any successors or assigns) at
the time, in the manner, and with interest at the rates hereinafter provided,
the principal amount of the Retained Repriced Old Form Note Advance Portions
more particularly described in the Retained Repriced Old Form Note Advance
Portion Schedules attached hereto as Annex 2B.
2. Principal Amount of Retained Repriced Old Form Note Advance Portions.
The principal amount of each Retained Repriced Old Form Note Advance
Portion shall be the amount specified on the respective Retained Repriced Old
Form Note Advance Portion Schedule as being the principal amount of such
Retained Repriced Old Form Note Advance Portion.
3. Maturity Dates.
Each Retained Repriced Old Form Note Advance Portion shall mature on the
date specified on the respective Retained Repriced Old Form Note Advance Portion
Schedule as being the maturity date for such Retained Repriced Old Form Note
Advance Portion (such date being the "Final Maturity Date" for such Retained
Repriced Old Form Note Advance Portion).
4. Applicable Interest Rate; Computation of Interest.
The interest rate applicable to each Retained Repriced Old Form Note
Advance Portion shall be the rate specified on the respective Retained Repriced
Old Form Note Advance Portion Schedule as being the interest rate for such
Retained Repriced Old Form Note Advance Portion. Subject to paragraph 8 of this
Part IIB, interest on each Retained Repriced Old Form Note Advance Portion shall
accrue from December 31, 1996, to the date on which the principal amount of such
Retained Repriced Old Form Note Advance Portion is paid. Interest on each
Retained Repriced Old Form Note Advance Portion shall be computed on the basis
of (a) actual days elapsed from (but not including) December 31, 1996, to (and
including) the date on which payment is due, and
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 18
Part IIB (Retained Repriced Old Form Note Advance Portions)
(b) a year of 365 days (except in calendar years including February 29, when the
basis shall be a 366-day year).
5. Payment of Interest.
The interest accrued on each Retained Repriced Old Form Note Advance
Portion shall be due and payable on each Payment Date, commencing on the first
Payment Date to occur after the effective date of this Retained Indebtedness
Note up through and including the Final Maturity Date for such Retained Repriced
Old Form Note Advance Portion. The amount of accrued interest on each Retained
Repriced Old Form Note Advance Portion that shall be due and payable on each
such Payment Date shall be the amount specified on the respective Retained
Repriced Old Form Note Advance Portion Schedule as being the amount of accrued
interest due and payable on such Payment Date.
6. Payment of Principal.
The principal amount of each Retained Repriced Old Form Note Advance
Portion shall be payable in installments on each Payment Date, commencing on the
first Payment Date to occur after the effective date of this Retained
Indebtedness Note up through and including the Final Maturity Date for such
Retained Repriced Old Form Note Advance Portion. The amount of principal of each
Retained Repriced Old Form Note Advance Portion that shall be due and payable on
each such Payment Date shall be the amount of principal specified on the
respective Retained Repriced Old Form Note Advance Portion Schedule as being the
amount of principal due and payable on such Payment Date.
7. Business Days.
Whenever any Payment Date or the respective Final Maturity Date for any
Retained Repriced Old Form Note Advance Portion shall fall on a day which is not
a Business Day, the payment that would otherwise be due on such Payment Date or
Final Maturity Date shall be due on the first Business Day thereafter.
8. Late Charges.
If any payment of any amount owing under any Retained Repriced Old Form
Note Advance Portion is not made when and as due (any such amount being then an
"Overdue Amount"), the amount payable shall be such Overdue Amount plus interest
thereon (such interest being the "Late Charge") computed in accordance with
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 19
Part IIB (Retained Repriced Old Form Note Advance Portions)
this paragraph 8. The Late Charge shall accrue from the scheduled date of
payment for the Overdue Amount (taking into account paragraph 7 of this Part
IIB) to the actual date on which payment is made. The Late Charge shall be
computed on the basis of (a) actual days elapsed from (but not including) the
scheduled date of payment for such Overdue Amount (taking into account paragraph
7 of this Part IIB) to (and including) the date on which payment is made, and
(b) a year of 365 days (except in calendar years including February 29, when the
basis shall be a 366-day year). The Late Charge shall accrue at a rate (the
"Late Charge Rate") equal to one and one-half times the rate to be determined by
the Secretary of the Treasury taking into consideration the prevailing market
yield on the remaining maturity of the most recently auctioned 13-week United
States Treasury bills. The initial Late Charge Rate shall be in effect until
either the actual date of payment or the next succeeding Payment Date, whichever
occurs first. If the Overdue Amount and the amount of accrued Late Charge are
not paid on or before the next succeeding Payment Date, then an amount equal to
the amount of accrued Late Charge shall be added to the Overdue Amount, and the
amount then payable shall be the sum of the Overdue Amount and the amount of
accrued Late Charge, plus a Late Charge on such sum accruing at a new Late
Charge Rate to be then determined in accordance with the principles of the
second preceding sentence. For so long as any overdue Amount remains unpaid, the
Late Charge Rate shall be redetermined in accordance with the principles of the
third preceding sentence on each succeeding Payment Date and shall be applied to
the Overdue Amount and all amounts of accrued Late Charge to the actual date of
payment. Nothing in this paragraph shall be construed as permitting or implying
that the Borrower may, without the written consent of FFB, modify, extend, alter
or affect in any manner whatsoever (except as explicitly provided herein) the
right of FFB to receive any and all payments on account of Retained Repriced Old
Form Note Advance Portions on the dates specified in this Part IIB.
9. Final Due Date.
Notwithstanding anything in this Retained Indebtedness Note to the
contrary, all amounts outstanding under this Retained Indebtedness Note on
account of each Retained Repriced Old Form Note Advance Portion, which amounts
remain unpaid as of the Final Maturity Date for such Retained Repriced Old Form
Note Advance Portion, shall be due and payable on the Final Maturity Date for
such Retained Repriced Old Form Note Advance Portion.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 20
Part IIB (Retained Repriced Old Form Note Advance Portions)
10. Application of Payments.
Each payment made on any Retained Repriced Old Form Note Advance Portion
shall be applied first to the payment of any Late Charge payable under paragraph
8 of this Part IIB, then to the payment of any premium payable under paragraph
11 of this Part IIB, then to the payment of accrued interest, then on account of
outstanding principal, and then to the payment of the fee payable under
paragraph 2 of Part IV of this Retained Indebtedness Note.
11. Prepayments.
The Borrower may elect to prepay all or any Portion of any Retained
Repriced Old Form Note Advance Portion in the manner, at the price, and subject
to the limitations as next described:
(a) The Borrower shall deliver to FFB written notification of such
prepayment election not less than 5 Business Days prior to the proposed date of
prepayment and, if less than the total outstanding principal amount of such
Retained Repriced Old Form Note Advance Portion is to be prepaid, the Borrower
shall specify in such notification the Portion thereof that is proposed to be
prepaid.
(b) The Borrower shall pay to FFB, at the time of prepayment of all or any
Portion of any Retained Repriced Old Form Note Advance Portion:
(1) for so long as the Refinancing Authority shall be in effect, the
outstanding principal amount of such Retained Repriced Old Form Note
Advance Portion or the Portion thereof to be prepaid, all accrued interest
thereon through the date of prepayment, plus the prepayment premium
required by the terms of the Refinancing Authority; and
(2) in the event that the Refinancing Authority shall no longer be
in effect, a price for such Retained Repriced Old Form Note Advance
Portion, and all accrued interest thereon through the date of prepayment,
that would, if such Retained Repriced Old Form Note Advance Portion were
purchased and held to its maturity, produce a yield to the purchaser for
the period from the date of purchase to the maturity of such Retained
Repriced Old Form Note Advance Portion substantially equal to the interest
rate that would be set on a loan from the Secretary of the Treasury to FFB
to purchase an obligation having a payment schedule
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 21
Part IIB (Retained Repriced Old Form Note Advance Portions)
identical to that of such Retained Repriced Old Form Note Advance Portion;
and if the Borrower elects to repurchase a Portion of a Retained Repriced
Old Form Note Advance Portion, the Borrower shall pay to FFB a price for
such Portion that would equal such Portion's pro rata share of the price
for a repurchase of the entire Retained Repriced Old Form Note Advance
Portion, calculated in accordance with the principles of this sentence.
The amount of each such prepayment premium or prepayment price, as the case may
be, shall be calculated by the Secretary of the Treasury as of the close of
business 2 Business Days prior to the date of the proposed prepayment, using
standard calculation methods of the United States Department of the Treasury.
(c) If the Borrower elects to prepay a Portion of a Retained Repriced Old
Form Note Advance Portion, the prepayment price paid shall be applied, first, to
interest accrued on such Portion of the Retained Repriced Old Form Note Advance
Portion to the date of prepayment and, then, to principal installments in the
inverse order of maturity. Following the prepayment of a Portion of a Retained
Repriced Old Form Note Advance Portion, subsequent payments shall continue to be
made in the amounts specified in the respective Retained Repriced Old Form Note
Advance Portion Schedule, and such payments shall be allocated by FFB between
outstanding principal and accrued interest, as appropriate, until the entire
principal amount of such Retained Repriced Old Form Note Advance Portion, and
all interest accrued thereon, is paid.
(d) Any prepayment of a Portion of a Retained Repriced Old Form Note
Advance Portion shall, as to the principal amount of such Portion, be subject to
a minimum amount equal to $100,000.00 of principal.
(e) The provisions of this paragraph 11 shall apply to all prepayments of
any Retained Repriced Old Form Note Advance Portion, regardless whether such
prepayments are made pursuant to the Refinancing Authority or otherwise.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 22
PART IIC
TERMS APPLICABLE TO
RETAINED NEW FORM NOTE ADVANCE PORTIONS
1. Promise to Pay.
FOR VALUE RECEIVED, the Borrower (which term includes any successors or
assigns) promises to pay FFB (which term includes any successors or assigns) at
the time, in the manner, and with interest at the rates hereinafter provided,
the principal amount of the Retained New Form Note Advance Portions more
particularly described in the Retained New Form Note Advance Portion Schedules
attached hereto as Annex 2C.
2. Principal Amount of Retained Now Form Note Advance Portions.
The principal amount of each Retained New Form Note Advance Portion shall
be the amount specified on the respective Retained New Form Note Advance Portion
Schedule as being the principal amount of such Retained New Form Note Advance
Portion.
3. Maturity Dates; Maturity Extensions; Early Extensions.
Each Retained New Form Note Advance Portion shall mature in accordance
with the following provisions:
(a) Each Retained New Form Note Advance Portion shall mature on the date
specified on the respective Retained New Form Note Advance Portion Schedule as
being the maturity date for such Retained New Form Note Advance Portion (such
date being the "Maturity Date" for such Retained New Form Note Advance Portion),
except as hereinafter provided.
(b) For each Retained New Form Note Advance Portion with respect to which
the respective Maturity Date (as specified on the respective Retained New Form
Note Advance Portion Schedule) occurs prior to the date specified on the
respective Retained New Form Note Advance Portion Schedule as being the final
maturity date for such Retained New Form Note Advance Portion (such date being
the "Final Maturity Date" for such Retained New Form Note Advance Portion), the
Borrower may, effective as of such Maturity Date, extend the Maturity Date for
such Retained New Form Note Advance Portion to a new Maturity Date (any such
extension, or any subsequent extension, being a "Maturity Extension"); provided
that the new Maturity Date for each Maturity Extension shall meet the following
criteria:
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 23
Part IIC (Retained New Form Note Advance Portions)
(1) each Maturity Date for a Maturity Extension of a Retained New
Form Note Advance Portion shall be a Payment Date;
(2) no Maturity Date for a Maturity Extension of any Retained New
Form Note Advance Portion shall be later than the Final Maturity Date for
the respective Retained New Form Note Advance Portion; and
(3) each Maturity Date for a Maturity Extension of a Retained New
Form Note Advance Portion shall be at least 6 months from the effective
date of such Maturity Extension; except that, in the case of a Maturity
Date for a Maturity Extension of a Retained New Form Note Advance Portion
that occurs on the third Payment Date preceding the Final Maturity Date
for such Retained New Form Note Advance Portion, any extension of that new
Maturity Date shall be to the Final Maturity Date for such Retained New
Form Note Advance Portion.
(c) For each Retained New Form Note Advance Portion with respect to which
the respective Maturity Date occurs prior to the Final Maturity Date for such
Retained New Form Note Advance Portion, the Borrower may, prior to such Maturity
Date, extend the Maturity Date for such Retained New Form Note Advance Portion
to a new Maturity Date, including the Final Maturity Date for such Retained New
Form Note Advance Portion (any such extension being an "Early Extension");
provided that the Borrower shall (1) follow the procedures prescribed in
subparagraph (a) of paragraph 11 of this Part IIC for prepaying Retained New
Form Note Advance Portions, and (2) pay FFB, on the effective date of such Early
Extension, an amount equal to the interest accrued on such Retained New Form
Note Advance Portion through the effective date of such Early Extension and the
premium, if any, that would be payable to FFB under subparagraph (b) of
paragraph 11 of this Part IIC if the Borrower were to prepay such Retained New
Form Note Advance Portion on the effective date of such Early Extension. If the
application of the principles of paragraph 11 of this Part IIC to any Early
Extension shall result in a discount on the respective Retained New Form Note
Advance Portion, such discount will be applied by FFB in the manner requested in
writing by the Borrower, with the written approval of RUS.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 24
Part IIC (Retained New Form Note Advance Portions)
(d) Each selection by the Borrower of a new Maturity Date for a Maturity
Extension of any Retained New Form Note Advance Portion must be approved by RUS
in writing, and notification of each such Maturity Date, together with evidence
of RUS approval thereof, must be delivered to FFB not less than 3 Business Days
prior to the proposed date for such Maturity Extension in the form prescribed by
FFB for such notification.
4. Applicable Interest Rate; Establishment of Interest Rate for Maturity
Extensions; Computation of Interest.
The interest rate applicable to each Retained New Form Note Advance
Portion shall be the rate specified on the respective Retained New Form Note
Advance Portion Schedule as being the interest rate for such Retained New Form
Note Advance Portion. In the event of a Maturity Extension of any Retained New
Form Note Advance Portion, the interest rate for such Retained New Form Note
Advance Portion, from and after the effective date of such Maturity Extension,
shall be the respective rate that is established by FFB at the time of such
Maturity Extension on the basis of the determination made by the Secretary of
the Treasury pursuant to section 6(b) (12 U.S.C. ss. 2285(b)) of the Federal
Financing Bank Act of 1973, as amended (12 U.S.C. ss. 2281 et seq.) (the "FFB
Act"); provided, however, that the shortest maturity used as the basis for any
rate determination shall be the remaining maturity of the most recently
auctioned 13-week United States Treasury bill. Subject to paragraph 8 of this
Part IIC, interest on each Retained New Form Note Advance Portion shall accrue
from December 31, 1996, to the date on which the principal amount of such
Retained New Form Note Advance Portion is due. Interest on each Retained New
Form Note Advance Portion shall be computed on the basis of (a) actual days
elapsed from (but not including) December 31, 1996, to (and including) the date
on which payment is due, and (b) a year of 365 days (except in calendar years
including February 29, when the basis shall be a 366-day year).
5. Payment of Interest.
The interest accrued on each Retained New Form Note Advance Portion shall
be due and payable on each Payment Date, commencing on the first Payment Date to
occur after the effective date of this Retained Indebtedness Note up through and
including the Maturity Date for such Retained New Form Note Advance Portion. The
amount of accrued interest on each Retained New Form Note Advance Portion that
shall be due and payable on each such
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 25
Part IIC (Retained New Form Note Advance Portions)
Payment Date shall be the amount specified on the respective Retained New Form
Note Advance Portion Schedule as being the amount of accrued interest due and
payable on such Payment Date. In the event of a Maturity Extension occurring
after the date of this Retained Indebtedness Note with respect to any Retained
New Form Note Advance Portion, the accrued interest on each such Maturity
Extension shall be due and payable on each Payment Date occurring after the
effective date of such Maturity Extension up through and including the Maturity
Date for such Maturity Extension. The amount of accrued interest on each
Maturity Extension that shall be due and payable on each such Payment Date shall
be computed in accordance with the provisions of paragraph 4 of this Part IIC.
6. Payment of Principal; Principal Payment Options.
The principal amount of each Retained New Form Note Advance Portion shall
be payable in accordance with the following provisions:
(a) Principal payments on each Retained New Form Note Advance Portion
shall begin on the date specified on the respective Retained New Form Note
Advance Portion Schedule as being the date for making the first payment of the
principal of such Retained New Form Note Advance Portion (such date being the
"First Principal Payment Date" for such Retained New Form Note Advance Portion)
and shall be made on each subsequent Payment Date until such Retained New Form
Note Advance Portion is paid in full on or before the Final Maturity Date for
such Retained New Form Note Advance Portion; except that, for so long as (1) no
schedule for the payment of the principal of any Retained New Form Note Advance
Portion is specified on any of the Retained New Form Note Advance Portion
Schedules, and (2) the Borrower has not selected a method for the payment of the
principal of any of the Retained New Form Note Advance Portions from among any
of the methods listed in subparagraph (b) of this paragraph 6, the First
Principal Payment Date for such Retained New Form Note Advance Portion may be
deferred by the mutual agreement of the Borrower, RUS, and FFB; provided that a
written amendment to this Note reciting the new and later First Principal
Payment Date shall have been executed by the Borrower and approved by RUS and
delivered to FFB not less than 3 Business Days prior to the then current First
Principal Payment Date.
(b) If a schedule for the payment of the principal of any Retained New
Form Note Advance Portion is specified on the
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 26
Part IIC (Retained New Form Note Advance Portions)
respective Retained New Form Note Advance Portion Schedule, then the amount of
principal due and payable on each such Payment Date shall be the amount
specified on the respective Retained New Form Note Advance Portion Schedule as
being the amount of principal due and payable on such Payment Date. If a
schedule for the payment of the principal of any Retained New Form Note Advance
Portion is not specified on any of the Retained New Form Note Advance Portion
Schedules, then the Borrower must select, subject to RUS approval, a method for
the payment of principal when the Borrower first selects a Maturity Date for a
Retained New Form Note Advance Portion that occurs on or after the First
Principal Payment Date for such Retained New Form Note Advance Portion. The
Borrower shall select a method for the payment of principal from among the
following options:
(1) "equal principal payments" -- the amount of each quarterly
principal payment shall substantially equal the amount of every other
quarterly principal payment;
(2) "graduated principal payments" -- the amount of each of the
first one-third (or nearest number of payments that rounds to one-third)
of the total number of quarterly principal payments shall substantially
equal one-half of the amount of each of the remaining quarterly principal
payments;
(3) "level debt service" -- the amount of each quarterly payment of
principal and accrued interest shall substantially equal the amount of
every other quarterly payment.
(c) In the event of a Maturity Extension occurring after the date of this
Retained Indebtedness Note with respect to any Retained New Form Note Advance
Portion not having a schedule for the payment of principal specified on the
respective Retained New Form Note Advance Portion Schedule:
(1) if the Borrower selects the "equal principal payments" method
for the payment of the principal of such Retained New Form Note Advance
Portion at the time of such Maturity Extension, then the level quarterly
payments of principal, along with accrued interest on the unpaid principal
balance, shall be paid on each Payment Date beginning on the First
Principal Payment Date and ending on the Final Maturity Date for such
Retained New Form Note Advance Portion;
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 27
Part IIC (Retained New Form Note Advance Portions)
(2) if the Borrower selects the "graduated principal payments"
method for the payment of the principal of such Retained New Form Note
Advance Portion at the time of such Maturity Extension, then the graduated
quarterly payments of principal, along with accrued interest on the unpaid
principal balance, shall be paid on each Payment Date beginning on the
First Principal Payment Date and ending on the Final Maturity Date for
such Retained New Form Note Advance Portion; and
(3) if the Borrower selects the "level debt service" method for the
payment of the principal of such Retained New Form Note Advance Portion at
the time of such Maturity Extension, then the level quarterly payments of
principal and accrued interest (subject to adjustment in the event of any
subsequent Maturity Extensions as hereinafter provided) shall be paid on
each Payment Date beginning with the First Principal Payment Date and
ending on the Final Maturity Date for such Retained New Form Note Advance
Portion.
(d) In the event of a Maturity Extension occurring after the date of this
Retained Indebtedness Note with respect to any Retained New Form Note Advance
Portion having a schedule for the payment of principal specified on the
respective Retained New Form Note Advance Portion Schedule, or any Retained New
Form Note Advance Portion with respect to which the Borrower has previously
selected a method for the payment of the principal of such Retained New Form
Note Advance Portion:
(1) if the principal payment schedule specified was determined using
the "equal principal payments" method, or if the method selected for the
payment of principal was the "equal principal payments" method, then the
level quarterly payments of principal that are due and payable on each
Payment Date occurring after the effective date of such Maturity Extension
shall be the same as the level quarterly payments of principal that were
due and payable on each Payment Date occurring before the effective date
of such Maturity Extension;
(2) if the principal payment schedule specified was determined using
the "graduated principal payments" method, or if the method selected for
the payment of principal was the "graduated principal payments" method,
then the graduated quarterly payments of principal that are due and
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 28
Part IIC (Retained New Form Note Advance Portions)
payable on each Payment Date occurring after the effective date of such
Maturity Extension shall be determined with reference to the date on which
the first payment of principal was due and payable by the Borrower under
the terms of the respective New Form Note, and not with reference to first
Payment Date to occur after the effective date of the Maturity Extension;
and
(3) if the principal payment schedule specified was determined using
the "level debt service" method, or if the method selected for the payment
of principal was the "level debt service" method, then the level quarterly
payments of principal and accrued interest that are due and payable on
each Payment Date occurring after the effective date such Maturity
Extension shall be newly determined taking into account the new interest
rate that is applicable to such Retained New Form Note Advance Portion
from and after the effective date of such Maturity Extension.
(e) If a schedule for the payment of the principal of any Retained New
Form Note Advance Portion is specified on the respective Retained New Form Note
Advance Portion Schedule, the Borrower may not change such principal payment
schedule, except as hereinafter provided. In the event of a Maturity Extension
occurring after the date of this Retained Indebtedness Note with respect to any
Retained New Form Note Advance Portion not having a schedule for the payment of
principal through the Maturity Date thereof specified on the respective Retained
New Form Note Advance Portion Schedule, and the Borrower selects a method for
the payment of principal from among the methods listed in subparagraph (b) of
this paragraph 6, the Borrower may not change the resulting principal payment
schedule, except as hereinafter provided. The Borrower may change the method of
payment of the principal of any Retained New Form Note Advance Portion having a
Maturity Date that occurs prior to the Final Maturity Date for such Retained New
Form Note Advance Portion from either the "equal principal payments" method or
the "graduated principal payments" method to the "level debt service" method at
the time, if ever, of a Maturity Extension of such Retained New Form Note
Advance Portion, effective on the date of such Maturity Extension. After the
Borrower selects the Final Maturity Date as being the Maturity Date for a
Maturity Extension of any Retained New Form Note Advance Portion, no changes in
the resulting principal payment schedule may be made and no more Maturity
Extensions may occur for such Retained New Form Note Advance Portion.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 29
Part IIC (Retained New Form Note Advance Portions)
(f) The entire unpaid principal amount of any Retained New Form Note
Advance Portion having a Maturity Date that occurs prior to the Final Maturity
Date for such Retained New Form Note Advance Portion shall be due and payable on
such Maturity Date, subject to Maturity Extensions in accordance with paragraph
3 of this Part IIC. In the event of a Maturity Extension of any Retained New
Form Note Advance Portion having a Maturity Date that occurs on or after the
First Principal Payment Date but prior to the Final Maturity Date for such
Retained New Form Note Advance Portion, the principal payment that is due
according to the resulting principal payment schedule shall nevertheless be due
and payable on the Maturity Date, notwithstanding such Maturity Extension.
(g) Notwithstanding which of the 3 methods listed in subparagraph (b) of
this paragraph 6 is selected for the payment of principal of any Retained New
Form Note Advance Portion, the aggregate of all quarterly payments on such
Retained New Form Note Advance Portion shall be such as will pay the entire
principal amount of such Retained New Form Note Advance Portion, and all
interest accrued thereon, on or before the Final Maturity Date for such Retained
New Form Note Advance Portion.
7. Business Days.
Whenever any Payment Date or the Maturity Date for any Retained New Form
Note Advance Portion shall fall on a day which is not a Business Day, the
payment that would otherwise be due on such Payment Date or Maturity Date shall
be due on the first Business Day thereafter. In the case of a Payment Date for a
Maturity Extension of any Retained New Form Note Advance Portion falling on a
day other than a Business Day, the extension of time for making the payment that
would otherwise be due on such Payment Date shall (a) be taken into account in
establishing the interest rate for the respective Maturity Extension of the
Retained New Form Note Advance Portion, and (b) be included in computing
interest in connection with such payment and excluded in connection with the
next payment. In the case of the Maturity Date for a maturity Extension of any
Retained New Form Note Advance Portion falling on a day other than a Business
Day, the extension of time for making the payment that would otherwise be due on
such Maturity Date shall (a) be taken into account in establishing the interest
rate for the respective Maturity Extension of the Retained New Form Note Advance
Portion, and (b)
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 30
Part IIC (Retained New Form Note Advance Portions)
be included in computing interest in connection with such payment.
8. Late Charges.
If any payment of any amount owing under any Retained New Form Note
Advance Portion is not made when and as due (any such amount being then an
"Overdue Amount"), the amount payable shall be such Overdue Amount plus interest
thereon (such interest being the "Late Charge") computed in accordance with this
paragraph 8. The Late Charge shall accrue from the scheduled date of payment for
the Overdue Amount (taking into account paragraph 7 of this Part IIC) to the
actual date on which payment is made. The Late Charge shall be computed on the
basis of (a) actual days elapsed from (but not including) the scheduled date of
payment for such Overdue Amount (taking into account paragraph 7 of this Part
IIC) to (and including) the date on which payment is made, and (b) a year of 365
days (except in calendar years including February 29, when the basis shall be a
366-day year). The Late Charge shall accrue at a rate (the "Late Charge Rate")
equal to one and one-half times the rate to be determined by the Secretary of
the Treasury taking into consideration the prevailing market yield on the
remaining maturity of the most recently auctioned 13-week United States Treasury
bills. The initial Late Charge Rate shall be in effect until either the actual
date of payment or the next succeeding Payment Date, whichever occurs first. If
the Overdue Amount and the amount of accrued Late Charge are not paid on or
before the next succeeding Payment Date, then an amount equal to the amount of
accrued Late Charge shall be added to the Overdue Amount, and the amount then
payable shall be the sum of the Overdue Amount and the amount of accrued Late
Charge, plus a Late Charge on such sum accruing at a new Late Charge Rate to be
then determined in accordance with the principles of the second preceding
sentence. For so long as any Overdue Amount remains unpaid, the Late Charge Rate
shall be redetermined in accordance with the principles of the third preceding
sentence on each succeeding Payment Date and shall be applied to the Overdue
Amount and all amounts of accrued Late Charge to the actual date of payment.
Nothing in this paragraph shall be construed as permitting or implying that the
Borrower may, without the written consent of FFB, modify, extend, alter or
affect in any manner whatsoever (except as explicitly provided herein) the right
of FFB to receive any and all payments on account of Retained New Form Note
Advance Portions on the dates specified in this Part IIC.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 31
Part IIC (Retained New Form Note Advance Portions)
9. Final Due Date.
Notwithstanding anything in this Retained Indebtedness Note to the
contrary, all amounts outstanding under this Retained Indebtedness Note on
account of each Retained New Form Note Advance Portion, which amounts remain
unpaid as of the Final Maturity Date for such Retained New Form Note Advance
Portion, shall be due and payable on the Final Maturity Date for such Retained
New Form Note Advance Portion.
10. Application of Payments.
Each payment made on any Retained New Form Note Advance Portion shall be
applied first to the payment of any Late Charge payable under paragraph 8 of
this Part IIC, then to the payment of any premium payable under paragraph 11 of
this Part IIC, then to the payment of accrued interest, then on account of
outstanding principal, and then to the payment of the fee payable under
paragraph 2 of Part IV of this Retained Indebtedness Note.
11. Prepayments.
The Borrower may elect to prepay all or any Portion of the unpaid
principal balance of any Retained New Form Note Advance Portion in the manner,
at the price, and subject to the limitations as next described:
(a) The Borrower shall deliver to FFB written notification of such
prepayment election not less than 5 Business Days prior to the proposed date of
prepayment and, if less than the total outstanding principal amount of such
Retained New Form Note Advance Portion is to be prepaid, the Borrower shall
specify in such notification the Portion thereof that is proposed to be prepaid.
(b) The Borrower shall pay to FFB, at the time of prepayment of all or any
Portion of any Retained New Form Note Advance Portion:
(1) for so long as the Refinancing Authority shall be in effect, the
outstanding principal amount of such Retained New Form Note Advance
Portion or the Portion thereof to be prepaid, all accrued interest thereon
through the date of prepayment, plus the prepayment premium required by
the terms of the Refinancing Authority; and
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 32
Part IIC (Retained New Form Note Advance Portions)
(2) in the event that the Refinancing Authority shall no longer be
in effect, a price for such Retained New Form Note Advance Portion, and
all accrued interest thereon through the date of prepayment, that would,
if such Retained New Form Note Advance Portion were purchased and held to
its maturity, produce a yield to the purchaser for the period from the
date of purchase to the maturity of such Retained New Form Note Advance
Portion substantially equal to the interest rate that would be set on a
loan from the Secretary of the Treasury to FFB to purchase an obligation
having a payment schedule identical to that of such Retained New Form Note
Advance Portion; and if the Borrower elects to repurchase a Portion of a
Retained New Form Note Advance Portion, the Borrower shall pay to FFB a
price for such Portion that would equal such Portion's pro rata share of
the price for a repurchase of the entire Retained New Form Note Advance
Portion, calculated in accordance with the principles of this sentence.
The amount of each such prepayment premium or prepayment price, as the case may
be, shall be calculated by the Secretary of the Treasury as of the close of
business 2 Business Days prior to the date of the proposed prepayment, using
standard calculation methods of the United States Department of the Treasury.
(c) If the Borrower elects to prepay a Portion of a Retained New Form Note
Advance Portion, the prepayment price paid shall be applied, first, to interest
accrued on such Portion of the Retained New Form Note Advance Portion to the
date of prepayment and, then, to principal installments in the inverse order of
maturity. Following the prepayment of a Portion of a Retained New Form Note
Advance Portion, subsequent payments shall continue to be made in the amounts
specified in the respective Retained New Form Note Advance Portion Schedule, if
a schedule for the payment of principal is specified on such Retained New Form
Note Advance Portion Schedule, or, if not, then in accordance with the payment
schedule resulting from the method for the payment of principal selected under
subparagraph (b) of paragraph 6 of this Part IIC, until the entire principal
amount of such Retained New Form Note Advance Portion, and all accrued interest
thereon, is paid; except that, with respect to any Retained New Form Note
Advance Portion for which the Borrower has selected the "level debt service"
method under subparagraph (b) of paragraph (6) of this Part IIC, payments shall
continue to be made in accordance with the level debt service payment schedule
that resulted when the Borrower first selected the level debt
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 33
Part IIC (Retained New Form Note Advance Portions)
service method, and such payments shall be allocated by FFB between outstanding
principal and accrued interest, as appropriate, until the entire principal
amount of such Retained New Form Note Advance Portion, and all interest accrued
thereon, is paid.
(d) Any prepayment of a Portion of a Retained New Form Note Advance
Portion shall, as to the principal amount of such Portion, be subject to a
minimum amount equal to $100,000.00 of principal.
(e) The provisions of this paragraph 11 shall apply to all prepayments of
any Retained New Form Note Advance Portion, regardless whether such prepayments
are made pursuant to the refinancing Authority or otherwise.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 34
PART IID
TERMS APPLICABLE TO
RETAINED REFINANCED REFINANCING NOTE ADVANCE PORTIONS
1. Promise to Pay.
FOR VALUE RECEIVED, the Borrower (which term includes any successors or
assigns) promises to pay FFB (which term includes any successors or assigns) at
the time, in the manner, and with interest at the rates hereinafter provided,
the principal amount of the Retained Refinanced Refinancing Note Advance
Portions more particularly described in the Retained Refinanced Refinancing Note
Advance Portion Schedules attached hereto as Annex 2D.
2. Principal Amount of Retained Refinanced Refinancing Note Advance Portions.
The principal amount of each Retained Refinanced Refinancing Note Advance
Portion shall be the amount specified on the respective Retained Refinanced
Refinancing Note Advance Portion Schedule as being the principal amount of such
Retained Refinanced Refinancing Note Advance Portion.
3. Maturity Dates; Maturity Extensions; Early Extensions.
Each Retained Refinanced Refinancing Note Advance Portion shall mature in
accordance with the following provisions:
(a) Each Retained Refinance Refinancing Note Advance Portion shall mature
on the date specified on the respective Retained Refinanced Refinancing Note
Advance Portion Schedule as being the maturity date for such Retained Refinanced
Refinancing Note Advance Portion (such date being the "Maturity Date" for such
Retained Refinanced Refinancing Note Advance Portion), except as hereinafter
provided.
(b) For each Retained Refinanced Refinancing Note Advance Portion with
respect to which the respective Maturity Date (as specified on the respective
Retained Refinanced Refinancing Note Advance Portion Schedule) occurs prior to
the date specified on the respective Retained Refinanced Refinancing Note
Advance Portion Schedule as being the final maturity date for such Retained
Refinanced Refinancing Note Advance Portion (such date being the "Final Maturity
Date" for such Retained Refinanced Refinancing Note Advance Portion), the
Borrower may, effective as of such Maturity Date, extend the Maturity Date for
such Retained
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 35
Part IID (Retained Refinanced Refinancing Note Advance Portions)
Refinanced Refinancing Note Advance Portion to a new Maturity Date (any such
extension, or any subsequent extension, being a "Maturity Extension"); provided
that the new Maturity Date for each Maturity Extension shall meet the following
criteria:
(1) each Maturity Date for a Maturity Extension of a Retained
Refinanced Refinancing Note Advance Portion shall be a Payment Date;
(2) no Maturity Date for a Maturity Extension of any Retained
Refinanced Refinancing Note Advance Portion shall be later than the Final
Maturity Date for the respective Retained Refinanced Refinancing Note
Advance Portion; and
(3) each Maturity Date for a Maturity Extension of a Retained
Refinanced Refinancing Note Advance Portion shall be at least one calendar
quarter from the effective date of such Maturity Extension.
(c) For each Retained Refinanced Refinancing Note Advance Portion with
respect to which the respective Maturity Date occurs prior to the Final Maturity
Date for such Retained Refinanced Refinancing Note Advance Portion, the Borrower
may, prior to such Maturity Date, extend the Maturity Date for such Retained
Refinanced Refinancing Note Advance Portion to a new Maturity Date, including
the Final Maturity Date for such Retained Refinanced Refinancing Note Advance
Portion (any such extension being an "Early Extension"); provided that the
Borrower shall (1) follow the procedures prescribed in subparagraph (a) of
paragraph 11 of this Part IID for prepaying Retained Refinanced Refinancing Note
Advance Portions, and (2) pay FFB, on the effective date of such Early
Extension, an amount equal to the interest accrued on such Retained Refinanced
Refinancing Note Advance Portion through the effective date of such Early
Extension and the premium, if any, that would be payable to FFB under
subparagraph (b) of paragraph 11 of this Part IID if the Borrower were to prepay
such Retained Refinanced Refinancing Note Advance Portion on the effective date
of such Early Extension. If the application of the principles of paragraph 11 of
this Part IID to any Early Extension shall result in a discount on the
respective Retained Refinanced Refinancing Note Advance Portion, such discount
will be applied by FFB in the manner requested in writing by the Borrower, with
the written approval of RUS.
(d) Each selection by the Borrower of a new Maturity Date for a Maturity
Extension of any Retained Refinanced Refinancing
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 36
Part IID (Retained Refinanced Refinancing Note Advance Portions)
Note Advance Portion must be approved by RUS in writing, and notification of
each such Maturity Date, together with evidence of RUS approval thereof, must be
delivered to FFB not less than 3 Business Days prior to the proposed date for
such Maturity Extension in the form prescribed by FFB for such notification.
4. Applicable Interest Rate; Establishment of Interest Rate for Maturity
Extensions; Computation of Interest; Applicable Fee.
(a) The interest rate applicable to each Retained Refinanced Refinancing
Note Advance Portion shall be the rate specified on the respective Retained
Refinanced Refinancing Note Advance Portion Schedule as being the interest rate
for such Retained Refinanced Refinancing Note Advance Portion. In the event of a
Maturity Extension of any Retained Refinanced Refinancing Note Advance Portion,
the interest rate for such Retained Refinanced Refinancing Note Advance Portion,
from and after the effective date of such Maturity Extension, shall be the
respective rate that is established by FFB at the time of such Maturity
Extension on the basis of the determination made by the Secretary of the
Treasury pursuant to section 6(b) of the FFB Act (12 U.S.C. ss. 2285(b));
provided, however, that the shortest maturity used as the basis for any rate
determination shall be the remaining maturity of the most recently auctioned
13-week United States Treasury bill. Subject to paragraph 8 of this Part IID,
interest on each Retained Refinanced Refinancing Note Advance Portion shall
accrue from December 31, 1996, to the date on which the principal amount of such
Retained Refinanced Refinancing Note Advance Portion is due. Interest on each
Retained Refinanced Refinancing Note Advance Portion shall be computed on the
basis of (a) actual days elapsed from (but not including) December 31, 1996, to
(and including) the date on which payment is due, and (b) a year of 365 days
(except in calendar years including February 29, when the basis shall be a
366-day year).
(b) In addition to the interest that accrues at a rate determined in
accordance with the preceding subparagraph, a fee to cover all administrative
expenses of FFB and to provide for the accumulation by FFB of reasonable
contingency reserves, assessed by FFB pursuant to section 6(c) of the FFB Act
(12 U.S.C. ss. 2285(c)), shall accrue on each Retained Refinanced Refinancing
Note Advance Portion from December 31, 1996, to the date on which the principal
amount of such Retained Refinanced Refinancing Note Advance Portion is due. The
fee for each
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 37
Part IID (Retained Refinanced Refinancing Note Advance Portions)
Retained Refinanced Refinancing Note Advance Portion shall be equal to
one-eighth of one percent (0.125%) per annum of the unpaid principal balance of
such Retained Refinanced Refinancing Note Advance Portion. The fee on each
Retained Refinanced Refinancing Note Advance Portion shall be computed on the
basis of (1) actual days elapsed from (but not including) December 31, 1996, to
(and including) the date on which payment is due, and (2) a year of 365 days
(except in calendar years including February 29, when the basis shall be a
366-day year).
5. Payment of interest and Fee.
The interest accrued on each Retained Refinanced Refinancing Note Advance
Portion and the applicable fee shall be due and payable on each Payment Date,
commencing on the first Payment Date to occur after the effective date of this
Retained Indebtedness Note up through and including the Maturity Date for such
Retained Refinanced Refinancing Note Advance Portion. The amount of accrued
interest on each Retained Refinanced Refinancing Note Advance Portion and the
amount of the applicable fee that shall be due and payable on each such Payment
Date shall be the respective amounts specified on the respective Retained
Refinanced Refinancing Note Advance Portion Schedule as being the amount of
accrued interest and the amount of the applicable fee due and payable on such
Payment Date. In the event of a Maturity Extension occurring after the date of
this Retained Indebtedness Note with respect to any Retained Refinanced
Refinancing Note Advance Portion, the accrued interest on each such Maturity
Extension and the applicable fee shall be due and payable on each Payment Date
occurring after the effective date of such Maturity Extension up through and
including the Maturity Date for such Maturity Extension. The amount of accrued
interest on each Maturity Extension and the amount of the applicable fee that
shall be due and payable on each such Payment Date shall be computed in
accordance with the provisions of paragraph 4 of this Part IID.
6. Payment of Principal; Principal Payment Options.
The principal amount of each Retained Refinanced Refinancing Note Advance
Portion shall be payable in accordance with the following provisions:
(a) Principal payments on each Retained Refinanced Refinancing Note
Advance Portion shall begin on the date specified on the respective Retained
Refinanced Refinancing Note
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 38
Part IID (Retained Refinanced Refinancing Note Advance Portions)
Advance Portion Schedule as being the date for making the first payment of the
principal of such Retained Refinanced Refinancing Note Advance Portion (such
date being the "First Principal Payment Date" for such Retained Refinanced
Refinancing Note Advance Portion) and shall be made on each subsequent Payment
Date until such Retained Refinanced Refinancing Note Advance Portion is paid in
full on or before the Final Maturity Date for such Retained Refinanced
Refinancing Note Advance Portion; except that, for so long as (1) no schedule
for the payment of the principal of any Retained Refinanced Refinancing Note
Advance Portion is specified on any of the Retained Refinanced Refinancing Note
Advance Portion Schedules, and (2) the Borrower has not selected a method for
the payment of the principal of any of the Retained Refinanced Refinancing Note
Advance Portions from among any of the methods listed in subparagraph (b) of
this paragraph 6, the First Principal Payment Date for such Retained Refinanced
Refinancing Note Advance Portion may be deferred by the mutual agreement of the
Borrower, RUS, and FFB; provided that a written amendment to this Note reciting
the new and later First Principal Payment Date shall have been executed by the
Borrower and approved by RUS and delivered to FFB not less than 3 Business Days
prior to the then current First Principal Payment Date.
(b) If a schedule for the payment of the principal of any Retained
Refinanced Refinancing Note Advance Portion is specified on the respective
Retained Refinanced Refinancing Note Advance Portion Schedule, then the amount
of principal due and payable on each such Payment Date shall be the amount
specified on the respective Retained Refinanced Refinancing Note Advance Portion
Schedule as being the amount of principal due and payable on such Payment Date.
If a schedule for the payment of the principal of any Retained Refinanced
Refinancing Note Advance Portion is not specified on any of the Retained
Refinanced Refinancing Note Advance Portion Schedules, then the Borrower must
select, subject to RUS approval, a method for the payment of principal when the
Borrower first selects a Maturity Date for a Retained Refinanced Refinancing
Note Advance Portion that occurs on or after the First Principal Payment Date
for such Retained Refinanced Refinancing Note Advance Portion. The Borrower
shall select a method for the payment of principal from among the following
options:
(1) "equal principal payments" -- the amount of each quarterly
principal payment shall substantially equal the amount of every other
quarterly principal payment;
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 39
Part IID (Retained Refinanced Refinancing Note Advance Portions)
(2) "graduated principal payments" -- the amount of each of the
first one-third (or nearest number of payments that rounds to one-third)
of the total number of quarterly principal payments shall substantially
equal one-half of the amount of each of the remaining quarterly principal
payments;
(3) "level debt service" -- the amount of each quarterly payment of
principal, accrued interest, and the applicable fee shall substantially
equal the amount of every other quarterly payment.
(c) In the event of a Maturity Extension occurring after the date of this
Retained Indebtedness Note with respect to any Retained Refinanced Refinancing
Note Advance Portion not having a schedule for the payment of principal
specified on the respective Retained Refinanced Refinancing Note Advance Portion
Schedule:
(1) if the Borrower selects the "equal principal payments" method
for the payment of the principal of such Retained Refinanced Refinancing
Note Advance Portion at the time of such Maturity Extension, then the
level quarterly payments of principal, along with accrued interest on the
unpaid principal balance and the applicable fee, shall be paid on each
Payment Date beginning on the First Principal Payment Date and ending on
the Final Maturity Date for such Retained Refinanced Refinancing Note
Advance Portion;
(2) if the Borrower selects the "graduated principal payments"
method for the payment of the principal of such Retained Refinanced
Refinancing Note Advance Portion at the time of such Maturity Extension,
then the graduated quarterly payments of principal, along with accrued
interest on the unpaid principal balance and the applicable fee, shall be
paid on each Payment Date beginning on the First Principal Payment Date
and ending on the Final Maturity Date for such Retained Refinanced
Refinancing Note Advance Portion; and
(3) if the Borrower selects the "level debt service" method for the
payment of the principal of such Retained Refinanced Refinancing Note
Advance Portion at the time of such Maturity Extension, then the level
quarterly payments of principal, accrued interest, and the applicable fee
(subject to adjustment in the event of any subsequent Maturity Extensions
as hereinafter provided) shall be paid
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 40
Part IID (Retained Refinanced Refinancing Note Advance Portions)
on each Payment Date beginning with the First Principal Payment Date and
ending on the Final Maturity Date for such Retained Refinanced Refinancing
Note Advance Portion.
(d) In the event of a Maturity Extension occurring after the date of this
Retained Indebtedness Note with respect to any Retained Refinanced Refinancing
Note Advance Portion having a schedule for the payment of principal specified on
the respective Retained Refinanced Refinancing Note Advance Portion Schedule, or
any Retained Refinanced Refinancing Note Advance Portion with respect to which
the Borrower has previously selected a method for the payment of the principal
of such Retained Refinanced Refinancing Note Advance Portion:
(1) if the principal payment schedule specified was determined using
the "equal principal payments" method, or if the method selected for the
payment of principal was the "equal principal payments" method, then the
level quarterly payments of principal that are due and payable on each
Payment Date occurring after the effective date of such Maturity Extension
shall be the same as the level quarterly payments of principal that were
due and payable on each Payment Date occurring before the effective date
of such Maturity Extension;
(2) if the principal payment schedule specified was determined using
the "graduated principal payments" method, or if the method selected for
the payment of principal was the "graduated principal payments" method,
then the graduated quarterly payments of principal that are due and
payable on each Payment Date occurring after the effective date of such
Maturity Extension shall be determined with reference to the date on which
the first payment of principal was due and payable by the Borrower under
the terms of the respective Refinanced Refinancing Note, and not with
reference to first Payment Date to occur after the effective date of the
Maturity Extension; and
(3) if the principal payment schedule specified was determined using
the "level debt service" method, or if the method selected for the payment
of principal was the "level debt service" method, then the level quarterly
payments of principal, accrued interest, and the applicable fee that are
due and payable on each Payment Date occurring after the effective date
such Maturity Extension shall be newly determined taking into account the
new interest rate that is
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 41
Part IID (Retained Refinanced Refinancing Note Advance Portions)
applicable to such Retained Refinanced Refinancing Note Advance Portion
from and after the effective date of such Maturity Extension.
(e) If a schedule for the payment of the principal of any Retained
Refinanced Refinancing Note Advance Portion is specified on the respective
Retained Refinanced Refinancing Note Advance Portion Schedule, the Borrower may
not change such principal payment schedule, except as hereinafter provided. In
the event of a Maturity Extension occurring after the date of this Retained
Indebtedness Note with respect to any Retained Refinanced Refinancing Note
Advance Portion not having a schedule for the payment of principal through the
Maturity Date thereof specified on the respective Retained Refinanced
Refinancing Note Advance Portion Schedule, and the Borrower selects a method for
the payment of principal from among the methods listed in subparagraph (b) of
this paragraph 6, the Borrower may not change the resulting principal payment
schedule, except as hereinafter provided. The Borrower may change the method of
payment of the principal of any Retained Refinanced Refinancing Note Advance
Portion having a Maturity Date that occurs prior to the Final Maturity Date for
such Retained Refinanced Refinancing Note Advance Portion from either the "equal
principal payments" method or the "graduated principal payments" method to the
"level debt service" method at the time, if ever, of a Maturity Extension of
such Retained Refinanced Refinancing Note Advance Portion, effective on the date
of such Maturity Extension. After the Borrower selects the Final Maturity Date
as being the Maturity Date for a Maturity Extension of any Retained Refinanced
Refinancing Note Advance Portion, no changes in the resulting principal payment
schedule may be made and no more Maturity Extensions may occur for Such Retained
Refinanced Refinancing Note Advance Portion.
(f) The entire unpaid principal amount of any Retained Refinanced
Refinancing Note Advance Portion having a Maturity Date that occurs prior to the
Final Maturity Date for such Retained Refinanced Refinancing Note Advance
Portion shall be due and payable on such Maturity Date, subject to Maturity
Extensions in accordance with paragraph 3 of this Part IID. In the event of a
Maturity Extension of any Retained Refinanced Refinancing Note Advance Portion
having a Maturity Date that occurs on or after the First Principal Payment Date
but prior to the Final Maturity Date for such Retained Refinanced Refinancing
Note Advance Portion, the principal payment that is due according to the
resulting principal payment schedule shall nevertheless be due
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 42
Part IID (Retained Refinanced Refinancing Note Advance Portions)
and payable on the Maturity Date, notwithstanding such Maturity Extension.
(g) Notwithstanding which of the 3 methods listed in subparagraph (b) of
this paragraph 6 is selected for the payment of principal of any Retained
Refinanced Refinancing Note Advance Portion, the aggregate of all quarterly
payments on such Retained Refinanced Refinancing Note Advance Portion shall be
such as will pay the entire principal amount of such Retained Refinanced
Refinancing Note Advance Portion, and all interest accrued thereon and the
applicable fee, on or before the Final Maturity Date for such Retained
Refinanced Refinancing Note Advance Portion.
7. Business Days.
Whenever any Payment Date or the Maturity Date for any Retained Refinanced
Refinancing Note Advance Portion shall fall on a day which is not a Business
Day, the payment that would otherwise be due on such Payment Date or Maturity
Date shall be due on the first Business Day thereafter. In the case of a Payment
Date for a Maturity Extension of any Retained Refinanced Refinancing Note
Advance Portion falling on a day other than a Business Day, the extension of
time for making the payment that would otherwise be due on such Payment Date
shall (a) be taken into account in establishing the interest rate for the
respective Maturity Extension of the Retained Refinanced Refinancing Note
Advance Portion, and (b) be included in computing interest and the applicable
fee in connection with such payment and excluded in connection with the next
payment. In the case of the Maturity Date for a Maturity Extension of any
Retained Refinanced Refinancing Note Advance Portion falling on a day other than
a Business Day, the extension of time for making the payment that would
otherwise be due on such Maturity Date shall (a) be taken into account in
establishing the interest rate and the applicable fee for the respective
Maturity Extension of the Retained Refinanced Refinancing Note Advance portion,
and (b) be included in computing interest in connection with such payment.
8. Late Charges.
If any payment of any amount owing under any Retained Refinanced
Refinancing Note Advance Portion is not made when and as due (any such amount
being then an "Overdue Amount"), the amount payable shall be such Overdue Amount
plus interest thereon (such interest being the "Late Charge") computed in
accordance
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 43
Part IID (Retained Refinanced Refinancing Note Advance Portions)
with this paragraph 8. The Late Charge shall accrue from the scheduled date of
payment for the Overdue Amount (taking into account paragraph 7 of this Part
IID) to the actual date on which payment is made. The Late Charge shall be
computed on the basis of (a) actual days elapsed from (but not including) the
scheduled date of payment for such Overdue Amount (taking into account paragraph
7 of this Part IID) to (and including) the date on which payment is made, and
(b) a year of 365 days (except in calendar years including February 29, when the
basis shall be a 366-day year). The Late Charge shall accrue at a rate (the
"Late Charge Rate") equal to one and one-half times the rate to be determined by
the Secretary of the Treasury taking into consideration the prevailing market
yield on the remaining maturity of the most recently auctioned 13-week United
States Treasury bills. The initial Late Charge Rate shall be in effect until
either the actual date of payment or the next succeeding Payment Date, whichever
occurs first. If the Overdue Amount and the amount of accrued Late Charge are
not paid on or before the next succeeding Payment Date, then an amount equal to
the amount of accrued Late Charge shall be added to the Overdue Amount, and the
amount then payable shall be the sum of the Overdue Amount and the amount of
accrued Late Charge, plus a Late Charge on such sum accruing at a new Late
Charge Rate to be then determined in accordance with the principles of the
second preceding sentence. For so long as any Overdue Amount remains unpaid, the
Late Charge Rate shall be redetermined in accordance with the principles of the
third preceding sentence on each succeeding Payment Date and shall be applied to
the Overdue Amount and all amounts of accrued Late Charge to the actual date of
payment. Nothing in this paragraph shall be construed as permitting or implying
that the Borrower may, without the written consent of FFB, modify, extend, alter
or affect in any manner whatsoever (except as explicitly provided herein) the
right of FFB to receive any and all payments on account of Retained Refinanced
Refinancing Note Advance Portions on the dates specified in this Part IID.
9. Final Due Date.
Notwithstanding anything in this Retained Indebtedness Note to the
contrary, all amounts outstanding under this Retained Indebtedness Note on
account of each Retained Refinanced Refinancing Note Advance Portion, which
amounts remain unpaid as of the Final Maturity Date for such Retained Refinanced
Refinancing Note Advance Portion, shall be due and payable on the Final Maturity
Date for such Retained Refinanced Refinancing Note Advance Portion.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 44
Part IID (Retained Refinanced Refinancing Note Advance Portions)
10. Application of Payments.
Each payment made on any Retained Refinanced Refinancing Note Advance
Portion shall be applied first to the payment of any Late Charge payable under
paragraph 8 of this Part IID, then to the payment of any premium payable under
paragraph 11 of this Part IID, then to the payment of accrued interest and the
amount of the applicable fee payable under paragraph 4 of this Part IID, then on
account of outstanding principal, and then to the payment of the fee payable
under paragraph 2 of Part IV of this Retained Indebtedness Note.
11. Prepayments.
The Borrower may elect to prepay all or any Portion of the unpaid
principal balance of any Retained Refinanced Refinancing Note Advance Portion in
the manner, at the price, and subject to the limitations as next described:
(a) The Borrower shall deliver to FFB written notification of such
prepayment election not less than 5 Business Days prior to the proposed date of
prepayment and, if less than the total outstanding principal amount of such
Retained Refinanced Refinancing Note Advance Portion is to be prepaid, the
Borrower shall specify in such notification the Portion thereof that is proposed
to be prepaid.
(b) The Borrower shall pay to FFB, at the time of prepayment of all or any
Portion of any Retained Refinanced Refinancing Note Advance Portion:
(1) for so long as the Refinancing Authority shall be in effect, the
outstanding principal amount of the Retained Refinanced Refinancing Note
Advance Portion or the Portion thereof to be prepaid, all accrued interest
thereon through the date of prepayment, the applicable fee through the
date of prepayment, plus the prepayment premium required by the terms of
the Refinancing Authority; and
(2) in the event that the Refinancing Authority shall no longer be
in effect, a price for such Retained Refinanced Refinancing Note Advance
Portion, and all accrued interest thereon through the date of prepayment
and the applicable fee through the date of prepayment, that would, if such
Retained Refinanced Refinancing Note Advance Portion were purchased and
held to its maturity, produce a yield to the
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 45
Part IID (Retained Refinanced Refinancing Note Advance Portions)
purchaser for the period from the date of purchase to the maturity of such
Retained Refinanced Refinancing Note Advance Portion substantially equal
to the interest rate that would be set on a loan from the Secretary of the
Treasury to FFB to purchase an obligation having a payment schedule
identical to that of such Retained Refinanced Refinancing Note Advance
Portion; and if the Borrower elects to repurchase a Portion of a Retained
Refinanced Refinancing Note Advance Portion, the Borrower shall pay to FFB
a price for such Portion that would equal such Portion's pro rata share of
the price for a repurchase of the entire Retained Refinanced Refinancing
Note Advance Portion, calculated in accordance with the principles of this
sentence.
The amount of each such prepayment premium or prepayment price, as the case may
be, shall be calculated by the Secretary of the Treasury as of the close of
business 2 Business Days prior to the date of the proposed prepayment, using
standard calculation methods of the United States Department of the Treasury.
(c) If the Borrower elects to prepay a Portion of a Retained Refinanced
Refinancing Note Advance Portion, the prepayment price paid shall be applied,
first, to accrued interest on such Portion of the Retained Refinanced
Refinancing Note Advance Portion to the date of prepayment and the applicable
fee to the date of prepayment and, then, to principal installments in the
inverse order of maturity. Following the prepayment of a Portion of a Retained
Refinanced Refinancing Note Advance Portion, subsequent payments shall continue
to be made in the amounts specified in the respective Retained Refinanced
Refinancing Note Advance Portion Schedule, if a schedule for the payment of
principal is specified on such Retained Refinanced Refinancing Note Advance
Portion Schedule, or, if not, then in accordance with the payment schedule
resulting from the method for the payment of principal selected under
subparagraph (b) of paragraph 6 of this Part IID, until the entire principal
amount of the Retained Refinanced Refinancing Note Advance Portion, and all
interest accrued thereon and the applicable fee, is paid; except that, with
respect to any Retained Refinanced Refinancing Note Advance Portion for which
the Borrower has selected the "level debt service" method under subparagraph (b)
of paragraph 6 of this Part IID, payments shall continue to be made in
accordance with the level debt service payment schedule that resulted when the
Borrower first selected the level debt service method, and such payments shall
be allocated by FFB among outstanding principal, accrued interest, and the
applicable fee,
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 46
Part IID (Retained Refinanced Refinancing Note Advance Portions)
as appropriate, until the entire principal amount of such Retained Refinanced
Refinancing Note Advance Portion, and all interest accrued thereon and the
applicable fee, is paid.
(d) Any prepayment of a Portion of a Retained Refinanced Refinancing Note
Advance Portion shall, as to the principal amount of such Portion, be subject to
a minimum amount equal to $100,000.00 of principal.
(e) The provisions of this paragraph 11 shall apply to all prepayments of
any Retained Refinanced Refinancing Note Advance Portion, regardless whether
such prepayments are made pursuant to the Refinancing Authority or otherwise.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 47
PART III
TERMS APPLICABLE TO
REFINANCED RETAINED ADVANCE PORTIONS
1. Promise to Pay.
FOR VALUE RECEIVED, the Borrower (which term includes any successors or
assigns) promises to pay FFB (which term includes any successors or assigns) at
the time, in the manner, and with interest at the rates hereinafter provided,
the principal amount of those certain Retained Advance Portions with respect to
which the Borrower makes a Refinancing Election, as provided in paragraph 6 of
Part I of this Retained Indebtedness Note (each Retained Advance Portion with
respect to which the Borrower makes a Refinancing Election being, from and after
the Refinancing Effective Date for such Refinancing Election, a "Refinanced
Retained Advance Portion," and more than one such Retained Advance Portion
being, collectively, "Refinanced Retained Advances Portions").
2. Principal Amount of Refinanced Retained Advance Portions.
The principal amount of each Refinanced Retained Advance Portion shall be
(a) the unpaid principal balance of the respective Retained Advance Portion, as
determined by FFB as of the respective Refinancing Effective Date, plus (b) if
the Borrower has made an Election to Finance the Premium with respect to such
Refinanced Retained Advance Portion, and the condition that applies to making
such Election to Finance the Premium has been satisfied, the amount of the
applicable Refinancing Premium, as provided in the Refinancing Authority.
3. Maturity Dates; Maturity Extensions; Early Extensions.
Each Refinanced Retained Advance Portion shall mature on the date
specified in the respective Election Approval Notice (such date being the
"Maturity Date" for such Refinanced Retained Advance Portion), which shall be
the date selected by the Borrower in accordance with the following provisions:
(a) Each Maturity Date for a Refinanced Retained Advance Portion shall be
a Payment Date.
(b) No Maturity Date for any Refinanced Retained Advance Portion shall be
later than the date specified on the respective Retained Old Form Note Advance
Portion Schedule, Retained
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 48
Part III (Refinanced Retained Advance Portions)
Repriced Old Form Note Advance Portion Schedule, Retained New Form Note Advance
Portion Schedule or Retained Refinanced Refinancing Note Advance Portion
Schedule, as the case may be, for the respective Retained Advance Portion as
being the final maturity date for such Retained Advance portion (such date being
the "Final Maturity Date" for such Refinanced Retained Advance Portion under the
terras of this Part III).
(c) Each Maturity Date for a Refinanced Retained Advance Portion shall be
at least one calendar quarter from the Refinancing Effective Date for such
Refinanced Retained Advance Portion.
(d) For each Refinanced Retained Advance Portion with respect to which the
Borrower selects a Maturity Date that occurs prior to the Final Maturity Date
for such Refinanced Retained Advance Portion, the Borrower may, effective as of
such Maturity Date, extend the Maturity Date for such Refinanced Retained
Advance Portion to a new Maturity Date (any such extension, or any subsequent
extension, being a "Maturity Extension"); provided that the new Maturity Date
for each Maturity Extension shall meet the criteria for Maturity Dates
prescribed in subparagraphs (a), (b), and (c) (being at least one calendar
quarter from the effective date of the Maturity Extension) of this paragraph 3.
(e) For each Refinanced Retained Advance Portion with respect to which the
Borrower selects a Maturity Date that occurs prior to the Final Maturity Date
for such Refinanced Retained Advance Portion, the Borrower may, on any Payment
Date prior to such Maturity Date, extend the Maturity Date for such Refinanced
Retained Advance Portion to a new Maturity Date, including the Final Maturity
Date (any such extension being an "Early Extension"); provided that the Borrower
shall (1) follow the procedures prescribed in subparagraph (a) of paragraph 11
of this Part III for prepaying Refinanced Retained Advance Portions, and (2) pay
FFB, on the effective date of such Early Extension, an amount equal to the
interest accrued on such Refinanced Retained Advance Portion through the
effective date of such Early Extension and the premium, if any, that would be
payable to FFB under subparagraph (b) of paragraph 11 of this Part III if the
Borrower were to prepay such Refinanced Retained Advance Portion on the
effective date of such Early Extension. If the application of the principles of
paragraph 11 of this Part III to any Early Extension shall result in a discount
on the respective Retained New Form Note Advance Portion, such discount will be
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 49
Part III (Refinanced Retained Advance Portions)
applied by FFB in the manner requested in writing by the Borrower, with the
written approval of RUS.
(f) Each selection by the Borrower of a Maturity Date for any Maturity
Extension governed by this Part III must be approved by RUS in writing, and
notification of each such Maturity Date, together with evidence of RUS approval
thereof, must be delivered to FFB not less than 5 Business Days prior to the
proposed date for such Maturity Extension, in the form prescribed by FFB for
such notification.
4. Establishment of Interest Rate for Refinanced Retained Advance Portions
and Maturity Extensions; Computation of Interest; Applicable Fee.
(a) The interest rate for each Refinanced Retained Advance Portion shall
be established by FFB as of the Refinancing Effective Date for such Refinanced
Retained Advance Portion on the basis of a determination made by the secretary
of the Treasury pursuant to the Refinancing Authority; provided, however, that
the shortest maturity used as the basis for any rate determination shall be the
remaining maturity of the most recently auctioned 13-week United States Treasury
bills. In the event of a Maturity Extension of any Refinanced Retained Advance
Portion, the interest rate for such Refinanced Retained Advance Portion, from
and after the effective date of such Maturity Extension, shall be the respective
rate that is established by FFB at the time of such Maturity Extension in
accordance with the principles of the preceding sentences of this paragraph 4.
Subject to paragraph 8 of this Part III, interest on each Refinanced Retained
Advance Portion shall accrue from the Refinancing Effective Date for such
Refinanced Retained Advance Portion to the date on which the principal amount of
such Refinanced Retained Advance Portion is due. Interest on each Refinanced
Retained Advance Portion shall be computed on the basis of (1) actual days
elapsed from (but not including) the Refinancing Effective Date for such
Refinanced Retained Advance Portion to (and including) the date on which payment
is due, and (2) a year of 365 days (except in calendar years including February
29, when the basis shall be a 366-day year).
(b) In addition to the interest that accrues at a rate determined in
accordance with the preceding subparagraph, a fee to cover all administrative
expenses of FFB and to provide for the accumulation by FFB of reasonable
contingency reserves, assessed by FFB pursuant to section 6(c) of the FFB Act
(12
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 50
Part III (Refinanced Retained Advance Portions)
U.S.C. ss. 2285(c)), shall accrue on each Refinanced Retained Advance Portion
from the Refinancing Effective Date for such Refinanced Retained Advance Portion
to the date on which the principal amount of such Refinanced Retained Advance
Portion is due. The fee for each Refinanced Retained Advance Portion shall be
equal to one-eighth of one percent (0.125%) per annum of the unpaid principal
balance of such Refinanced Retained Advance Portion. The fee on each Refinanced
Retained Advance Portion shall be computed on the basis of (1) actual days
elapsed from (but not including) the Refinancing Effective Date for such
Refinanced Retained Advance Portion to (and including) the date on which payment
is due, and (2) a year of 365 days (except in calendar years including February
29, when the basis shall be a 366-day year).
5. Payment of Interest and Fee.
Interest accrued on the outstanding principal amount of each Refinanced
Retained Advance Portion and the applicable fee shall be due and payable on each
Payment Date, commencing on the first Payment Date to occur after the
Refinancing Effective Date for such Refinanced Retained Advance Portion up
through and including the Maturity Date for such Refinanced Retained Advance
Portion. In the event of a Maturity Extension occurring after the Refinancing
Effective Date for any Refinanced Retained Advance Portion, the accrued interest
on each such Maturity Extension and the applicable fee shall be due and payable
on each Payment Date occurring after the effective date of such Maturity
Extension up through and including the Maturity Date for such Maturity
Extension. The amount of accrued interest on each such Maturity Extension and
the applicable fee that shall be due and payable on each such Payment Date shall
be computed in accordance with the provisions of paragraph 4 of this Part III.
6. Payment of Principal; Principal Payment Options.
The principal amount of each Refinanced Retained Advance Portion shall be
payable in accordance with the following provisions:
(a) Principal payments on each Refinanced Retained Advance Portion shall
begin on the first Payment Date to occur after the Refinancing Effective Date
for such Refinanced Retained Advance Portion and shall be made on each
subsequent Payment Date until such Refinanced Retained Advance Portion is paid
in full on or before the Final Maturity Date.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 51
Part III (Refinanced Retained Advance Portions)
(b) When the Borrower selects a Maturity Date for any Refinanced Retained
Advance Portion, the Borrower must also select, subject to RUS approval, a
method for the payment of principal from among the following options:
(1) "equal principal payments" -- the amount of each quarterly
principal payment shall substantially equal the amount of every other
quarterly principal payment;
(2) "graduated principal payments" -- the amount of each of the
first one-third (or nearest number of payments that rounds to one-third)
of the total number of quarterly principal payments shall substantially
equal one-half of the amount of each of the remaining quarterly principal
payments;
(3) "level debt service" -- the amount of each quarterly payment of
principal, accrued interest, and the applicable fee shall substantially
equal the amount of every other quarterly payment.
Approval of the Borrower's selection of a method for the payment of principal
may be withheld by RUS if RUS determines, in its sole discretion, that the
method selected by the Borrower would increase RUS's risk under its guarantee of
this Retained Indebtedness Note.
(c) With respect to each Refinanced Retained Advance Portion for which the
Borrower selects the "equal principal payments" method for the payment of
principal, the level quarterly payments of principal, along with accrued
interest on the unpaid principal balance and the applicable fee, shall be paid
on each Payment Date occurring after the Refinancing Effective Date for such
Refinanced Retained Advance Portion and ending on the Final Maturity Date for
such Refinanced Retained Advance Portion. With respect to each Refinanced
Retained Advance Portion for which the Borrower selects the "graduated principal
payments" method for the payment of principal, the graduated quarterly payments
of principal, along with accrued interest on the unpaid principal balance and
the applicable fee, shall be paid on each Payment Date occurring after the
Refinancing Effective Date for such Refinanced Retained Advance Portion and
ending on the Final Maturity Date for such Refinanced Retained Advance Portion.
With respect to each Refinanced Retained Advance Portion for which the Borrower
selects the
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 52
Part III (Refinanced Retained Advance Portions)
"level debt service" method for the payment of principal, the level quarterly
payments of principal, accrued interest, and the applicable fee shall be paid on
each Payment Date occurring after the Refinancing Effective Date (or the first
Payment Date to occur after a Maturity Extension) for such Refinanced Retained
Advance Portion and ending on the Final Maturity Date for such Refinanced
Retained Advance Portion.
(d) After the Borrower selects one of the 3 methods listed in subparagraph
(b) of this paragraph 6 for the payment of principal of any Refinanced Retained
Advance Portion, the resulting principal payment schedule for that Refinanced
Retained Advance Portion may not be changed; except that the Borrower may change
the method of payment of the principal of any Refinanced Retained Advance
Portion with respect to which the Borrower selects a Maturity Date that occurs
prior to the Final Maturity Date for such Refinanced Retained Advance Portion
from either the "equal principal payments" method or the "graduated principal
payments" method to the "level debt service" method at the time, if ever, of a
Maturity Extension of such Refinanced Retained Advance Portion, effective on the
date of such Maturity Extension. After the Borrower selects the Final Maturity
Date as being the Maturity Date for any Refinanced Retained Advance Portion or a
Maturity Extension of any Refinanced Retained Advance Portion, no changes in the
resulting principal repayment schedule may be made and no more Maturity
Extensions may occur for such Refinanced Retained Advance Portion.
(e) The entire unpaid principal amount of any Refinanced Retained Advance
Portion with respect to which the Borrower selects a Maturity Date that occurs
prior to the Final Maturity Date for such Refinanced Retained Advance Portion
shall be due and payable on such Maturity Date, subject to Maturity Extensions
in accordance with paragraph 3 of this Part III. In the event of a Maturity
Extension of any Refinanced Retained Advance Portion with respect to which the
Borrower selects a Maturity Date that occurs prior to the Final Maturity Date
for such Refinanced Retained Advance Portion, the principal payment that is due
according to the resulting principal payment schedule shall nevertheless be due
and payable on the Maturity Date, notwithstanding such Maturity Extension.
(f) Notwithstanding which of the 3 methods listed in subparagraph (b) of
this paragraph 6 is selected for the payment of principal of any Refinanced
Retained Advance Portion, the aggregate of all quarterly payments on such
Refinanced Retained
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 53
Part III (Refinanced Retained Advance Portions)
Advance Portion shall be such as will pay the entire principal amount of such
Refinanced Retained Advance Portion, and all interest and the applicable fee
accrued thereon, on or before the Final Maturity Date for such Refinanced
Retained Advance Portion.
7. Business Days.
Whenever any Payment Date or the Maturity Date for any Refinanced Retained
Advance Portion shall fall on a day which is not a Business Day, the payment
that would otherwise be due on such Payment Date or Maturity Date shall be due
on the first Business Day thereafter. In the case of a Payment Date for any
Refinanced Retained Advance Portion falling on a day other than a Business Day,
the extension of time for making the payment that would otherwise be due on such
Payment Date shall (a) be taken into account in establishing the interest rate
for the respective Refinanced Retained Advance Portion, and (b) be included in
computing interest and the applicable fee in connection with such payment and
excluded in connection with the next payment. In the case of the Maturity Date
for any Refinanced Retained Advance Portion falling on a day other than a
Business Day, the extension of time for making the payment that would otherwise
be due on such Maturity Date shall (a) be taken into account in establishing the
interest rate for the respective Refinanced Retained Advance Portion, and (b) be
included in computing interest and the applicable fee in connection with such
payment.
8. Late Charges.
If any payment of any amount owing on account of any Refinanced Retained
Advance Portion is not made when and as due (any such amount being then an
"Overdue Amount"), the amount payable shall be such Overdue Amount plus interest
thereon (such interest being the "Late Charge") computed in accordance with this
paragraph 8. The Late Charge shall accrue from the scheduled date of payment for
the Overdue Amount (taking into account paragraph 7 of this Part III) to the
actual date on which payment is made. The Late Charge shall be computed on the
basis of (a) actual days elapsed from (but not including) the scheduled date of
payment for such Overdue Amount (taking into account paragraph 7 of this Part
III) to (and including) the date on which payment is made, and (b) a year of 365
days (except in calendar years including February 29, when the basis shall be a
366-day year). The Late Charge shall accrue at a rate (the "Late Charge Rate")
equal to one and one-half times the rate to be determined by the Secretary of
the Treasury taking into consideration the
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 54
Part III (Refinanced Retained Advance Portions)
prevailing market yield on the remaining maturity of the most recently auctioned
13-week United States Treasury bills. The initial Late Charge Rate shall be in
effect until either the actual date of payment or the next succeeding Payment
Date, whichever occurs first. If the Overdue Amount and the amount of accrued
Late Charge are not paid on or before the next succeeding Payment Date, then an
amount equal to the amount of accrued Late Charge shall be added to the Overdue
Amount, and the amount then payable shall be the sum of the Overdue Amount and
the amount of accrued Late Charge, plus a Late Charge on such sum accruing at a
new Late Charge Rate to be then determined in accordance with the principles of
the second preceding sentence. For so long as any Overdue Amount remains unpaid,
the Late Charge Rate shall be redetermined in accordance with the principles of
the third preceding sentence on each succeeding Payment Date, and shall be
applied to the Overdue Amount and all amounts of accrued Late Charge to the
actual date of payment. Nothing in this paragraph shall be construed as
permitting or implying that the Borrower may, without the written consent of
FFB, modify, extend, alter or affect in any manner whatsoever (except as
explicitly provided herein) the right of FFB to receive any and all payments on
account of all Refinanced Retained Advance Portions on the dates specified in
this Part III.
9. Final Due Date.
Notwithstanding anything in this Retained Indebtedness Note to the
contrary, all amounts outstanding under this Retained Indebtedness Note on
account of each Refinanced Retained Advance Portion, which amounts remain unpaid
as of the Final Maturity Date for such Refinanced Retained Advance Portion,
shall be due and payable on the Final Maturity Date for such Refinanced Retained
Advance Portion.
10. Application of Payments.
Each payment made on any Refinanced Retained Advance Portion shall be
applied first to the payment of any Late Charge payable under paragraph 8 of
this Part III, then to the payment of any premium payable under paragraph 11 of
this Part III, then to the payment of accrued interest and the applicable fee
payable under paragraph 4 of this Part III, then on account of outstanding
principal, and then to the payment of the fee payable under paragraph 2 of Part
IV of this Retained Indebtedness Note.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 55
Part III (Refinanced Retained Advance Portions)
11. Prepayments.
The Borrower may elect to prepay all or any portion of the unpaid
principal balance of any Refinanced Retained Advance Portion in the manner, at
the price, and subject to the limitations as next described:
(a) The Borrower shall deliver to FFB written notification of such
prepayment election not less than 5 Business Days prior to the proposed date of
prepayment and, if less than the total outstanding principal amount of such
Refinanced Retained Advance Portion is to be prepaid, the Borrower shall specify
in such notification the amount that is proposed to be prepaid (any amount of a
Refinanced Retained Advance Portion which is less than the total outstanding
principal amount of the respective Refinanced Retained Advance Portion being a
"Portion").
(b) The Borrower shall pay to FFB, at the time of prepayment of all or any
Portion of any Refinanced Retained Advance Portion:
(1) for so long as the Refinancing Authority shall be in effect, the
outstanding principal amount of the Refinanced Retained Advance Portion,
or Portion thereof, to be prepaid, all accrued interest thereon through
the date of prepayment, the applicable fee through the date of prepayment,
plus the prepayment premium required by the terms of the Refinancing
Authority; and
(2) in the event that the Refinancing Authority shall no longer be
in effect, a price for such Refinanced Retained Advance Portion, and all
accrued interest thereon through the date of prepayment and the applicable
fee through the date of prepayment, that would, if such Refinanced
Retained Advance Portion were purchased and held to its maturity, produce
a yield to the purchaser for the period from the date of purchase to the
maturity of such Refinanced Retained Advance Portion substantially equal
to the interest rate that would be set on a loan from the Secretary of the
Treasury to FFB to purchase an obligation having a payment schedule
identical to that of such Refinanced Retained Advance Portion; and if the
Borrower elects to repurchase a Portion of a Refinanced Retained Advance
Portion, the Borrower shall pay to FFB a price for such Portion that would
equal such Portion's pro rata share of the price for a repurchase of the
entire Refinanced Retained Advance
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 56
Part III (Refinanced Retained Advance Portions)
Portion, calculated in accordance with the principles of this sentence.
The amount of each such prepayment premium or prepayment price, as the case may
be, shall be calculated by the Secretary of the Treasury as of the close of
business 2 Business Days prior to the date of the proposed prepayment, using
standard calculation methods of the United States Department of the Treasury.
(c) If the Borrower elects to prepay a Portion of a Refinanced Retained
Advance Portion, the prepayment price paid shall be applied, first, to accrued
interest on such Portion and the applicable fee to the date of prepayment and,
then, to principal installments in the inverse order of maturity. Following the
prepayment of a Portion of a Refinanced Retained Advance Portion, subsequent
payments shall continue to be made in accordance with the payment schedule
resulting from the method for the payment of principal selected under
subparagraph (b) of paragraph 6 of this Part III, until the entire principal
amount of the Refinanced Retained Advance Portion, and all accrued interest
thereon and the applicable fee, is paid; except that, with respect to any
Refinanced Retained Advance Portion for which the Borrower has selected the
"level debt service" method under subparagraph (b) of paragraph 6 of this Part
III, payments shall continue to be made in accordance with the level debt
service payment schedule that resulted when the Borrower first selected the
level debt service method, and such payments shall be allocated by FFB among
outstanding principal, accrued interest, and the applicable fee, as appropriate,
until the entire principal amount of such Refinanced Retained Advance Portion,
and all accrued interest thereon and the applicable fee, is paid.
(d) Any prepayment of a Portion of a Refinanced Retained Advance Portion
shall, as to the principal amount of such Portion, be subject to a minimum
amount equal to $100,000.00 of principal.
(e) The provisions of this paragraph 11 shall apply to all prepayments of
any Refinanced Retained Advance Portion, regardless whether such prepayment is
made pursuant to the Refinancing Authority or otherwise.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 57
PART IV
GENERAL
1. Payment by Wire Transfer.
For so long as FFB is the holder of this Retained Indebtedness Note and
RUS is the loan servicing agent for FFB, each payment on this Retained
Indebtedness Note shall be paid in immediately available funds by electronic
funds transfer to the account specified from time to time by RUS in a written
notice delivered by RUS to the Borrower. In the event that FFB is the holder of
this Retained Indebtedness Note but RUS is not the loan servicing agent for FFB,
then each payment under this Note shall be made in immediately available funds
by electronic funds transfer to the account specified from time to time by FFB
in a written notice delivered by FFB to the Borrower.
2. Loan Servicing Expense Fee.
For so long as FFB is the holder of this Retained Indebtedness Note and
RUS is the loan servicing agent for FFB, the Borrower agrees to pay FFB an
annual loan servicing expense fee, assessed by FFB pursuant to section 6(c) of
the FFB Act (12 U.S.C. ss. 2285(c)), in the amount of one one-thousandth of one
percent (0.00001) of the aggregate unpaid principal balance of all Assumed
Repriced Old Form Note Advance Portions, all Assumed New Form Note Advance
Portions, all Assumed Refinanced Refinancing Note Advance Portions, and all
Refinanced Assumed Advance Portions on December 31 of each year. The loan
servicing expense fee for each year shall be due and payable by the Borrower on
the March 31 Payment Date of the immediately following year, after taking into
account any payment made on the December 31 Payment Date of the respective year.
3. Amendments to Retained Indebtedness Note.
To the extent not inconsistent with applicable law, this Retained
Indebtedness Note, for so long as FFB is the holder thereof, shall be subject to
modification by such amendments, extensions, and renewals as may be agreed upon
from time to time by FFB and the Borrower, with the approval of RUS.
4. Certain Waivers.
The Borrower hereby waives any requirement for presentment, protest, or
other demand or notice with respect to this Retained Indebtedness Note.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 58
Part IV
5. Effective Until Paid.
This Retained Indebtedness Note shall continue in full force and effect
until all amounts due and payable hereunder have been paid in full.
6. RUS Guarantee of Note.
Upon execution of the guarantee set forth at the end of this Retained
Indebtedness Note (the "Guarantee"), the payment by the Borrower of all amounts
due and payable under this Retained Indebtedness Note, when and as due, shall be
guaranteed by the United States of America, acting through RUS, pursuant to the
Rural Electrification Act of 1936, as amended (7 U.S.C. ss. 901 et seq.). In
consideration of the Guarantee, the Borrower promises to RUS to make all
payments due under this Retained Indebtedness Note when and as due.
7. Security Instrument; RUS as Holder of Note for Purposes of the Security
Instrument.
This Retained Indebtedness Note is one of several notes permitted to be
executed and delivered by, and is entitled to the benefits and security of, the
particular security instrument or instruments specified on page 1 of this
Retained Indebtedness Note (such security instrument or instruments, as it or
they may have heretofore been, and as it or they may hereafter be, amended,
supplemented, restated, or consolidated from time to time in accordance with its
or their terms, being, collectively, the "Security Instrument"), whereby the
Borrower pledged and granted a security interest in certain property of the
Borrower, described therein, to secure the payment of and performance of certain
obligations owed to REA, predecessor to RUS, or to RUS, as the case may be, as
set forth in the Security Instrument. For purposes of the Security Instrument,
RUS shall be considered to be, and shall have the rights, powers, privileges,
and remedies of, the holder of this Retained Indebtedness Note.
8. Guarantee Payments; Reimbursement.
If RUS makes any payment, pursuant to the Guarantee, of any amount due and
payable under this Retained Indebtedness Note, when and as due, each and every
such payment so made shall be deemed to be a payment hereunder; provided,
however, that no payment by RUS pursuant to the Guarantee shall be considered a
payment for purposes of determining the existence of a failure by
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 59
Part IV
the Borrower to perform its obligation to RUS to make all payments under this
Retained Indebtedness Note when and as due. RUS shall have any rights by way of
subrogation, agreement or otherwise which arise as a result of such payment
pursuant to the Guarantee and as provided in the reimbursement note executed and
delivered by the Borrower to the United States of America, acting through RUS,
to evidence the Borrower's obligation to reimburse RUS for payment made by RUS
pursuant to the Guarantee.
9. Default and Enforcement.
In case of a default by the Borrower under this Retained Indebtedness Note
or a the occurrence of an event of default under the Security Instrument, then,
in consideration of the obligation of RUS under the Guarantee, in that event, to
make payments to FFB as provided in this Retained Indebtedness Note, RUS, in its
own name, shall have all rights, powers, privileges, and remedies of the holder
of this Retained Indebtedness Note, in accordance with the terms of this
Retained Indebtedness Note and the Security Instrument, including, without
limitation, the right to enforce or collect all or any part of the obligation of
the Borrower under this Retained Indebtedness Note or arising as a result of the
Guarantee, to file proofs of claim or any other document in any bankruptcy,
insolvency, or other judicial proceeding, and to vote such proofs of claim.
10. Acceleration.
The entire unpaid principal amount of this Retained Indebtedness Note, and
all interest thereon, plus the applicable fee, if any, may be declared, and upon
such declaration shall become, due and payable to RUS, under the circumstances
described, and in the manner and with the effect provided, in the Security
Instrument.
11. Incorporation of Annexes.
Annex 1 (the "Outstanding Notes") attached hereto, Annex 2A (the "Retained
Old Form Note Advance Portion Schedules") attached hereto, Annex 2B (the
"Retained Repriced Old Form Note Advance Portion Schedules") attached hereto,
Annex 2C (the "Retained New Form Note Advance Portion Schedules") attached
hereto, Annex 2D (the "Retained Refinanced Refinancing Note Advance Portion
Schedules") attached hereto, and Annex 3 (the form of Election Notice),
collectively form an integral part of this Retained Indebtedness Note, and are
incorporated herein by reference.
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 60
Part IV
IN WITNESS WHEREOF, the Borrower has caused this Retained Indebtedness
Note to be signed in its corporate name and its corporate seal to be hereunder
affixed and attested by its officers thereunto duly authorized, all as of the
day and year first above written.
OGLETHORPE POWER CORPORATION
(AN ELECTRIC MEMBERSHIP
GENERATION AND TRANSMISSION
CORPORATION)
By:
Signature: /s/ T. D. Kilgore
--------------------------
Print Name: T. D. Kilgore
-------------------------
Title: President
ATTEST:
Signature: /s/ Gary M. Bullock
--------------------------
Print Name: Gary M. Bullock
-------------------------
Title: Secretary
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 61
SCHEDULE TO
FFB RETAINED INDEBTEDNESS NOTE
The Amortization Schedule to the FFB Retained Indebtedness Note is not
filed herewith; however, the Registrant hereby agrees that such Schedule will be
provided to the Commission upon request.
RUS GUARANTEE
The United States of America, acting through the Administrator of the
Rural Utilities Service ("RUS"), successor to the Administrator of the Rural
Electrification Administration, hereby guarantees to the Federal Financing Bank,
its successors and assigns ("FFB"), all payments of principal, interest, premium
(if any), and late charges (if any), when and as due in accordance with the
terms of the note dated March 1, 1997, made by OGLETHORPE POWER CORPORATION (AN
ELECTRIC MEMBERSHIP GENERATION AND TRANSMISSION CORPORATION) (the "Borrower")
payable to FFB, to which this Guarantee is attached (such note being the
"Note"), with interest on the principal until paid, irrespective of (i)
acceleration of such payments under the terms of the Note, or (ii) receipt by
RUS of any sums or property from its enforcement of its remedies for the
Borrower's default.
This Guarantee is issued pursuant to section 306 and 306C of the Rural
Electrification Act of 1936, as amended (7 U.S.C. ss.ss. 936, 936c), and section
6 of the Federal Financing Bank of 1973 (12 U.S.C. ss. 2285).
UNITED STATES OF AMERICA
By: /s/ Wally Beyer
------------------------------
Name: Wally Beyer
----------------------------
Title: Administrator of the Rural
Utilities Service, successor
to the Administrator of the
Rural Electrification
Administration
Date: March 11, 1997
OGLETHORPE POWER CORPORATION RETAINED INDEBTEDNESS NOTE - page 539
REIMBURSEMENT NOTE
FFB Note Identifier: RUS Note Identifier:
( )
OGLETHRP 0012
Tucker, Georgia
March 1, 1997
REIMBURSEMENT NOTE
Oglethorpe Power Corporation (An Electric Membership Generation &
Transmission Corporation) (the "Borrower," which term includes any successors or
assigns), a corporation organized and existing under the laws of the State of
Georgia, for value received, promises to pay on demand to the order of the
UNITED STATES OF AMERICA (the "Government"), acting through the Administrator of
the Rural Utilities Service ("RUS"), at the United States Treasury, Washington,
D.C., a sum equal to:
(1) all amounts, including, without limitation, principal and interest
(the "Reimbursed Amount"), paid by the Government from time to time
pursuant to that certain guarantee made by RUS (the "RUS Guarantee") to
the Federal Financing Bank Act ("FFB") of amounts payable to FFB under
that certain Retained Indebtedness Note, dated as of March 1, 1997, made
by the Borrower payable to FFB, in the principal amount of
$2,637,781,327.45, and guaranteed by RUS (the "FFB Note") pursuant to the
Rural Electrification Act of 1936 as amended (7 U.S.C. 901 et seq.),
Section 6 of the Federal Financing Bank of 1973 (12 U.S.C. ss. 2285), and
the Note Purchase Commitment and Servicing Agreement, as amended and as it
may be amended, supplemented, or restated from time to time, dated as of
January 1, 1992, between FFB and RUS; plus
(2) interest on the Reimbursed Amount from the respective date of such
payment by RUS to FFB, at the Late Charge Rate as that term is defined in
the FFB Note; plus
(3) administrative costs and penalty charges assessed in accordance with
applicable regulations; and plus
(4) any and all costs and expenses incurred in connection with the
exercise of rights or the enforcement of (i) this Note, (ii) that certain
Amended and Consolidated Loan Contract by and between the Borrower and the
Government, dated as of March 1, 1997, as it may be amended, supplemented
or restated from time to time (the "Loan Contract"), and (iii) the
Security Documents, as hereinafter defined.
The obligations of the Borrower hereunder are absolute and unconditional,
irrespective of any defense or any right to set off, recoupment or counterclaim
it might otherwise have against the Government.
So long as RUS pays to FFB all amounts then due to it under the RUS
Guarantee, the Borrower agrees to pay all amounts due on this Note directly to
RUS. Nothing herein shall limit the Government's rights of subrogation which may
arise as a result of payments made by RUS pursuant to the RUS Guarantee.
This Note has been executed, delivered and authenticated pursuant to, and
is secured by, the Indenture, dated as of March 1, 1997, from Oglethorpe Power
Corporation (An Electric Membership Generation & Transmission Corporation),
Grantor, to SunTrust Bank, Atlanta, Trustee, as it may from time to time be
supplemented, modified or amended by one or more indentures or other instruments
supplemental thereto (including Supplemental Indentures as defined therein)
entered into pursuant to the applicable provisions of such Indenture (the
"Indenture") and the Security Agreement, dated as of March 1, 1997, made by OPC
to SunTrust Bank, Atlanta, Trustee, as it may from time to time be supplemented,
modified or amended (the "Security Agreement"; the Indenture and the Security
Agreement, collectively, the "Security Documents"). This Note is an "Existing
Obligation," a "RUS Reimbursement Note" and an "Obligation" (all as defined in
the Security Documents) and is entitled to all of the benefits of the Security
Documents. Among other things, the Security Documents provide that all
Obligations shall be equally and ratably secured thereby and reference is hereby
made to the Security Documents for a description of the property pledged, the
nature and extent of the security and the rights of the holders of Obligations
with respect thereto.
Neither the execution and delivery of this Note by the Borrower to the
Government, nor the failure of the Government to exercise its rights under the
Security Documents or the Loan Contract shall be deemed to be a waiver of any
right or remedy of the Government under the Security Documents or the Loan
Contract. Neither the acceptance nor the enforcement of this Note by the
Government shall relieve the Borrower of its obligation to repay the FFB Note in
accordance with its terms or deprive the holder of the FFB Note, which may be
the Government, of any benefit, right or privilege such holder may otherwise
enjoy as the "Holder" (as defined in the Security Documents) of an Obligation
secured by the Security Documents.
[Signatures Appear on Next Page]
2
IN WITNESS WHEREOF, the Borrower has caused this Note to be signed in its
corporate name and its corporate seal to be hereunto affixed and attested by its
officers thereunto duly authorized, all as of the day and year first above
written.
OGLETHORPE POWER CORPORATION (AN
(CORPORATE SEAL) ELECTRIC MEMBERSHIP GENERATION &
TRANSMISSION CORPORATION)
Attest /s/ Patricia N. Nash
------------------------- By: /s/ T. D. Kilgore
------------------------------------
T. D. Kilgore, President and Chief
Executive Officer
This is one of the Existing Obligations referred to in the Indenture, dated as
of March 1, 1997, by Oglethorpe Power Corporation (An Electric Membership
Generation & Transmission Corporation) to SunTrust Bank, Atlanta.
SUNTRUST BANK, ATLANTA, as Trustee
By: /s/ Bryan Echols
------------------------------------
Authorized Signatory
3
MORTGAGE NOTE
(G7)
PROJECT DESIGNATION:
GEORGIA 109-G7 OPC
MORTGAGE NOTE
made by
OGLETHORPE POWER CORPORATION
(AN ELECTRIC MEMBERSHIP GENERATION & TRANSMISSION CORPORATION)
to
UNITED STATES OF AMERICA
MORTGAGE NOTE
Tucker, Georgia
March 1, 1997
OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP GENERATION &
TRANSMISSION CORPORATION) (hereinafter called the "Corporation"), a corporation
organized and existing under the laws of the State of Georgia, for value
received, promises to pay to the order of UNITED STATES OF AMERICA (hereinafter
called the "Government"), acting through the Administrator of the Rural
Utilities Service, at the United States Treasury, Washington, D.C., at the times
and in the manner hereinafter provided, the principal sum of Three Million Eight
Hundred Twenty Thousand Three Hundred Fifty-Two and 89/100 Dollars
($3,820,352.89), with interest on the unpaid balance thereof from time to time,
at the rate of five (5) per centum per annum.
From and after the date hereof, the Corporation shall make consecutive
monthly payments on the last day of each month (each, a "Payment Date") each in
the amount of $23,824.54 until the earlier of May 31, 2019 or such time as all
principal hereof, and interest thereon, shall have been paid in full.
Each payment made on this Note shall be applied first to the payment of
interest on principal and then on account of principal. On May 31, 2019, the
principal hereof remaining unpaid, if any, and unpaid interest thereon, if any,
shall become due and payable.
The Corporation on any Payment Date, as hereinabove provided, may pay all
or any part of the principal hereof then outstanding, but so long as any of the
principal hereof shall remain unpaid, the Corporation shall be obligated to make
the monthly payment on account of principal and interest, in the amount
hereinabove provided, unless the Corporation and the holder of this Note shall
otherwise agree.
This Note has been executed, delivered and authenticated pursuant to, and
is secured by, the Indenture, dated as of March 1, 1997, from the Corporation,
as Grantor, to SunTrust Bank, Atlanta, as Trustee, as it may be supplemented,
modified or amended by one or more indentures or other instruments supplemental
thereto (including Supplemental Indentures as defined therein) entered into
pursuant to the applicable provisions of such Indenture (the "Indenture"). This
Note is an "Existing Obligation" and an "Obligation" (all as defined in the
Indenture) and is entitled to the benefits of the Indenture. Among other things,
the Indenture provides that all Obligations shall be equally and ratably secured
thereby and reference is hereby made to the Indenture for a description of the
property pledged, the nature and extent of the security and the rights of the
holders of Obligations with respect thereto.
In case of default by the Corporation, as provided in the Indenture, all
principal remaining unpaid on this Note, and all interest thereon, may be
declared or may become due and payable in the manner and with the effect
provided in the Indenture.
This Note evidences indebtedness created by a loan made under the Rural
Electrification Act of 1936, as amended, including Public Law 93-32.
If the Government shall at any time assign this Note and insure the
payment hereof, the Corporation shall continue to make payments hereunder to the
Government as collection agent for the insured holder, and, for purposes of the
Indenture, the Government, and not such insured holder, shall be considered to
be, and shall have the rights of, the noteholder.
This Note is given to evidence a portion of the indebtedness heretofore
evidenced by that certain Mortgage Note, made by the Corporation to the
Government, in the original face amount of $5,543,000, dated June 1, 1984 (the
"Original Note"). In connection with the execution and delivery of this Note,
Georgia Transmission Corporation (An Electric Membership Corporation) has
assumed liability for $774,952.26 of the indebtedness originally evidenced by
the Original Note, and the Government has released the Corporation from
liability for such assumed principal amount of the Original Note. From the date
of this Note, the Corporation's liability with respect to the indebtedness
evidenced by the Original Note shall be governed solely by this Note.
IN WITNESS WHEREOF, the Corporation has caused this Note to be signed in
its corporate name and its corporate seal to be hereunto affixed and attested by
its officers thereunto duly authorized, all as of the day and year first above
written.
OGLETHORPE POWER CORPORATION (AN
ELECTRIC MEMBERSHIP GENERATION &
TRANSMISSION CORPORATION)
By: /s/ T. D. Kilgore
----------------------------------------
T. D. Kilgore, President and Chief
Executive Officer
Attest /s/ Patricia N. Nash
-------------------------
This is one of the Existing Obligations
(CORPORATE SEAL) referred to in the Indenture, dated as of
March 1, 1997, by Oglethorpe Power
Corporation (An Electric Membership
Generation & Transmission Corporation) to
SunTrust Bank, Atlanta.
SUNTRUST BANK, ATLANTA, as Trustee
By: /s/ Bryan Echols
--------------------------------------
Authorized Signatory
2
MORTGAGE NOTE
(H13)
PROJECT DESIGNATION:
GEORGIA 109-H13 OPC
MORTGAGE NOTE
made by
OGLETHORPE POWER CORPORATION
(AN ELECTRIC MEMBERSHIP GENERATION & TRANSMISSION CORPORATION)
to
UNITED STATES OF AMERICA
MORTGAGE NOTE
Tucker, Georgia
March 1, 1997
OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP GENERATION & TRANSMISSION
CORPORATION) (hereinafter called the "Corporation"), a corporation organized and
existing under the laws of the State of Georgia, for value received, promises to
pay to the order of UNITED STATES OF AMERICA (hereinafter called the
"Government"), acting through the Administrator of the Rural Utilities Service,
at the United States Treasury, Washington, D.C., at the times and in the manner
hereinafter provided, the principal sum of Fourteen Million Seven Hundred
Eighty-Six Thousand Nine Hundred Eighty-Five and 70/100 Dollars
($14,786,985.70), with interest on the unpaid balance thereof from time to time,
at the rate of five (5) per centum per annum.
From and after the date hereof, the Corporation shall make consecutive
monthly payments on the last day of each month (each, a "Payment Date"), each in
the amount of $90,204.88 until the earlier of October 31, 2019 or such time as
$10,710,001.73 of the principal hereof, and interest thereon, shall have been
paid in full. Thereafter, the Corporation shall make consecutive monthly
payments on each Payment Date, each in the amount of $24,073.83 until the
earlier of October 31, 2021 or such time as all principal hereof, and interest
thereon, shall have been paid in full.
Each payment made on this Note shall be applied first to the payment of
interest on principal and then on account of principal. On October 31, 2019,
$10,710,001.73 of the principal hereof remaining unpaid, if any, and unpaid
interest thereon, if any, shall become due and payable. On October 31, 2021, the
principal hereof remaining unpaid, if any, and unpaid interest thereon, if any,
shall become due and payable.
The Corporation on any Payment Date, as hereinabove provided, may pay all
or any part of the principal hereof then outstanding, but so long as any of the
principal hereof shall remain unpaid, the Corporation shall be obligated to make
the monthly payment on account of principal and interest, in the amount
hereinabove provided, unless the Corporation and the holder of this Note shall
otherwise agree.
This Note has been executed, delivered and authenticated pursuant to, and
is secured by, the Indenture, dated as of March 1, 1997, from the Corporation,
as Grantor, to SunTrust Bank, Atlanta, as Trustee, as it may be supplemented,
modified or amended by one or more indentures or other instruments supplemental
thereto (including Supplemental Indentures as defined therein) entered into
pursuant to the applicable provisions of such Indenture (the "Indenture"). This
Note is an "Existing Obligation" and an "Obligation" (all as defined in the
Indenture) and is entitled to the benefits of the Indenture. Among other things,
the Indenture provides that all Obligations shall be equally and ratably secured
thereby and reference is hereby made to the Indenture for a description of the
property pledged, the nature and extent of the security and the rights of the
holders of Obligations with respect thereto.
In case of default by the Corporation, as provided in the Indenture, all
principal remaining unpaid on this Note, and all interest thereon, may be
declared or may become due and payable in the manner and with the effect
provided in the Indenture.
This Note evidences indebtedness created by a loan made under the Rural
Electrification Act of 1936, as amended, including Public Law 93-32.
If the Government shall at any time assign this Note and insure the
payment hereof, the Corporation shall continue to make payments hereunder to the
Government as collection agent for the insured holder, and, for purposes of the
Indenture, the Government, and not such insured holder, shall be considered to
be, and shall have the rights of, the noteholder.
This Note is given to evidence a portion of the indebtedness heretofore
evidenced by that certain Mortgage Note, made by the Corporation to the
Government, in the original face amount of $20,987,000, dated November 1, 1984,
as amended by that certain Agreement, dated as of November 3, 1986, by and
between the Government and the Corporation (as so amended, the "Original Note").
In connection with the execution and delivery of this Note, Georgia Transmission
Corporation (An Electric Membership Corporation) has assumed liability for
$2,999,515.57 of the indebtedness originally evidenced by the Original Note, and
the Government has released the Corporation from liability for such assumed
principal amount of the Original Note. From the date of this Note, the
Corporation's liability with respect to the indebtedness evidenced by the
Original Note shall be governed solely by this Note.
IN WITNESS WHEREOF, the Corporation has caused this Note to be signed in
its corporate name and its corporate seal to be hereunto affixed and attested by
its officers thereunto duly authorized, all as of the day and year first above
written.
OGLETHORPE POWER CORPORATION (AN
ELECTRIC MEMBERSHIP GENERATION &
TRANSMISSION CORPORATION)
By: /s/ T. D. Kilgore
----------------------------------------
T. D. Kilgore, President and Chief
Executive Officer
Attest /s/ Patricia N. Nash
-------------------------
This is one of the Existing Obligations
(CORPORATE SEAL) referred to in the Indenture, dated as of
March 1, 1997, by Oglethorpe Power
Corporation (An Electric Membership
Generation & Transmission Corporation) to
SunTrust Bank, Atlanta.
SUNTRUST BANK, ATLANTA, as Trustee
By: /s/ Bryan Echols
--------------------------------------
Authorized Signatory
2