EXHIBIT 4(d)
INDENTURE OF TRUST
(1998 Series B)
between
THE INDUSTRIAL DEVELOPMENT AUTHORITY
OF THE COUNTY OF APACHE
and
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION
Dated as of March 1, 1998
Authorizing
Pollution Control Revenue Bonds,
1998 Series B
(Tucson Electric Power Company Project)
TABLE OF CONTENTS*
Page
Parties........................... ................................ 1
Recitals........................................................... 1
Granting Clause.................................................... 2
ARTICLE I
DEFINITIONS
Section 1.01. .....................................Definitions 2
ARTICLE II
THE BONDS
Section 2.01. ...............................Creation of Bonds 8
Section 2.02. ...................................Form of Bonds 8
Section 2.03. ..............................Execution of Bonds 9
Section 2.04. .........................Authentication of Bonds 9
Section 2.05. ...................Bonds Not General Obligations 9
Section 2.06. ........Prerequisites to Authentication of Bonds 10
Section 2.07.Lost or Destroyed Bonds or Bonds Canceled in Error 10
Section 2.08. .....Transfer, Registration and Exchange of Bonds 11
Section 2.09. ................................Other Obligations 12
Section 2.10 ...................................Temporary Bonds 12
Section 2.11. ............................Cancellation of Bonds 13
Section 2.12. ................Payment of Principal and Interest 13
Section 2.13. ...........Applicability of Book-Entry Provisions 13
ARTICLE III
REDEMPTION OF BONDS
Section 3.01. ............................Redemption Provisions 13
Section 3.02. ................Selection of Bonds to be Redeemed 14
Section 3.03. .........................Procedure for Redemption 15
Section 3.04. ......................Payment of Redemption Price 15
Section 3.05. ..............No Partial Redemption After Default 16
ARTICLE IV
THE BOND FUND
Section 4.01. ............................Creation of Bond Fund 16
Section 4.02. ............................................Liens 16
(iii)
Section 4.03. ..........................Deposits into Bond Fund 16
Section 4.04. .......................Use of Moneys in Bond Fund 16
Section 4.05. .......Custody of Bond Fund; Withdrawal of Moneys 16
Section 4.06. ..................Bonds Not Presented for Payment 17
Section 4.07. .............................Moneys Held in Trust 17
ARTICLE V
DISPOSITION OF PROCEEDS
Section 5.01. ..........................Disposition of Proceeds 18
ARTICLE VI
INVESTMENTS
Section 6.01. ......................................Investments 18
ARTICLE VII
GENERAL COVENANTS
Section 7.01. ...........................No General Obligations 18
Section 7.02. Performance of Covenants of the Authority;
Representations 19
Section 7.03. Maintenance of Rights and Powers; Compliance with
Laws 19
Section 7.04. Enforcement of Obligations of the Company;
Amendments 19
Section 7.05. ..............................Further Instruments 19
Section 7.06. ...................No Disposition of Trust Estate 19
Section 7.07. .............................Financing Statements 19
Section 7.08. .......................Tax Covenants; Rebate Fund 19
Section 7.09. ...............................Notices of Trustee 20
ARTICLE VIII
DEFEASANCE
Section 8.01. .......................................Defeasance 21
ARTICLE IX
DEFAULTS AND REMEDIES
Section 9.01. ................................Events of Default 22
Section 9.02. .........................................Remedies 23
Section 9.03. ...................Restoration to Former Position 23
Section 9.04. ..............Owners' Right to Direct Proceedings 23
Section 9.05.Limitation on Owners' Right to Institute Proceedings 24
Section 9.06. ........No Impairment of Right to Enforce Payment 24
Section 9.07.Proceedings by Trustee without Possession of Bonds 24
Section 9.08. ..............................No Remedy Exclusive 24
Section 9.09. ............................No Waiver of Remedies 24
Section 9.10. ............................Application of Moneys 25
Section 9.11. .........................Severability of Remedies 25
ARTICLE X
TRUSTEE; PAYING AGENT AND CO-PAYING AGENTS; REGISTRAR
Section 10.01. ............................Acceptance of Trusts 26
Section 10.02. ..................No Responsibility for Recitals 26
Section 10.03. ........................Limitations on Liability 26
Section 10.04. .............Compensation, Expenses and Advances 26
Section 10.05. .....................Notice of Events of Default 27
Section 10.06. ...............................Action by Trustee 27
Section 10.07. .............................Good Faith Reliance 27
Section 10.08. Dealings in Bonds and with the Authority and the
Company 28
Section 10.09. ...........................Allowance of Interest 28
Section 10.10. .......................Construction of Indenture 28
Section 10.11. ..........................Resignation of Trustee 28
Section 10.12. ..............................Removal of Trustee 28
Section 10.13. ................Appointment of Successor Trustee 29
Section 10.14. .............Qualifications of Successor Trustee 29
Section 10.15. .......Judicial Appointment of Successor Trustee 29
Section 10.16. .......Acceptance of Trusts by Successor Trustee 29
Section 10.17. ............Successor by Merger or Consolidation 30
Section 10.18. ................................Standard of Care 30
Section 10.19. ...Notice to Owners of Bonds of Event of Default 30
Section 10.20. .....Intervention in Litigation of the Authority 30
Section 10.21. .................Paying Agent; Co-Paying Agents. 30
Section 10.22.Qualifications of Paying Agent and Co-Paying Agents;
Resignation; Removal 31
Section 10.23. .......................................Registrar 32
Section 10.24.Qualifications of Registrar; Resignation; Removal 32
Section 10.25. ..............................Several Capacities 32
ARTICLE XI
EXECUTION OF INSTRUMENTS BY OWNERS OF BONDS AND
PROOF OF OWNERSHIP OF BONDS
Section 11.01. ....Execution of Instruments; Proof of Ownership 33
ARTICLE XII
MODIFICATION OF THIS INDENTURE AND THE LOAN AGREEMENT
Section 12.01. .....................................Limitations 33
Section 12.02. ...Supplemental Indentures without Owner Consent 33
Section 12.03. ..Supplemental Indentures with Consent of Owners 34
Section 12.04. ................Effect of Supplemental Indenture 35
Section 12.05. ..........................Consent of the Company 35
Section 12.06. ..Amendment of Loan Agreement without Consent of
Owners 36
Section 12.07.Amendment of Loan Agreement with Consent of Owners 36
ARTICLE XIII
MISCELLANEOUS
Section 13.01. .....................Successors of the Authority 36
Section 13.02. .............................Parties in Interest 37
Section 13.03. ....................................Severability 37
Section 13.04. ....No Personal Liability of Authority Officials 37
Section 13.05. .....Bonds Owned by the Authority or the Company 37
Section 13.06. ....................................Counterparts 37
Section 13.07. ...................................Governing Law 37
Section 13.08. .........................................Notices 38
Section 13.09. ........................................Holidays 38
Section 13.10. ......Statutory Notice Regarding Cancellation of
Contracts 38
Testimonium......................................................... 40
Signatures and Seals................................................ 40
Exhibit A - Form of Bond...............................................A-1
Exhibit B - Form of Endorsement of Transfer............................B-1
Exhibit C - Form of Certificate of Authentication .....................C-1
* This table of contents is not a part of the Indenture, and is for convenience
only. The captions herein are of no legal effect and do not vary the meaning
or legal effect of any part of the Indenture.
INDENTURE OF TRUST
THIS INDENTURE OF TRUST (1998 Series B), dated as of
(this "Indenture"), between THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY
OF APACHE, an Arizona nonprofit corporation designated by law as a political
subdivision of the State of Arizona (hereinafter called the "Authority"), and
First Trust of New York, National Association, as trustee (hereinafter called
the "Trustee"),
W I T N E S S E T H :
WHEREAS, the Authority is authorized and empowered under Title 35, Chapter 5,
Arizona Revised Statutes, as amended (the "Act"), to issue its bonds in
accordance with the Act and to make secured or unsecured loans for the purpose
of financing or refinancing the acquisition, construction, improvement or
equipping of projects consisting of land, any building or other improvement,and
all real and personal properties, including but not limited to machinery and
equipment, whether or not now in existence or under construction, whether
located within or without Apache County, which shall be suitable for, among
other things, facilities for the furnishing of electric
energy, gas or water, air and water pollution control facilities and sewage and
solid waste disposal facilities, and to charge and collect interest on such
loans and pledge the proceeds of loan agreements as security for the payment of
the principal of and interest on any bonds, or designated issues of bonds,
issued by the Authority and any agreements made in connection therewith,
whenever the Board of Directors of the Authority finds such loans to be in
furtherance of the purposes of the Authority or in the public interest;
WHEREAS, the Authority has heretofore issued and sold (a) $100,000,000
aggregate principal amount of its Pollution Control Revenue Bonds,1981 Series A
(Tucson Electric Power Company Project) all of which remain outstanding (the
"1981 Series A Bonds"), the proceeds of which were loaned to Tucson Electric
Power Company, an Arizona corporation (the "Company") to finance a portion of
the costs of the acquisition, construction,improvement and equipping of certain
air and water pollution control and sewage and solid waste disposal facilities
at Unit No. 1 and Unit No. 2 of the Springerville Generating Station
(collectively, the "Pollution Control Facilities") and (b) $100,000,000
aggregate principal amount of its Pollution Control Revenue Bonds,1981 Series B
(Tucson Electric Power Company Project) all of which remain outstanding (the
"1981 Series B Bonds"), the proceeds of which were loaned to the Company to
finance a portion of the costs of the acquisition, construction, improvement
and equipping of the Pollution Control Facilities and certain facilities for
furnishing electric energy;
WHEREAS, the Authority proposes to issue and sell its revenue bonds, as
provided herein (the "Bonds") to refinance, by the payment or redemption of (a)
$41,400,000 aggregate principal amount of the 1981 Series A Bonds, or provision
therefor, which represents the extent to which the 1981 Series A Bonds financed
a portion of the costs of the acquisition, construction, improvement and
equipping of the Pollution Control Facilities at Unit No. 2; (b) $58,400,000
aggregate principal amount of the 1981 Series B Bonds, or provision therefor,
which represents the extent to which the 1981 Series B Bonds financed the
portion of the costs of the acquisition,construction, improvement and equipping
of the Pollution Control Facilities and certain facilities for furnishing
electric energy at Unit No. 2, all as described in Exhibit A to the Loan
Agreement, dated as of March 1, 1998 (the "Loan Agreement"), between the
Authority and the Company;
NOW, THEREFORE, for and in consideration of these premises and the mutual
covenants herein contained, of the acceptance by the Trustee of the trusts
hereby created, of the purchase and acceptance of the Bonds by the Owners (as
hereinafter defined) thereof and of the sum of one dollar lawful money of the
United States of America, to it duly paid by the Trustee at or before the
execution and delivery of these presents, and for other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, in
order to secure the payment of the principal of and premium, if any, and
interest on the Bonds at any time Outstanding (as hereinafter defined) under
this Indenture according to their tenor and effect and the performance and
observance by the Authority of all the covenants and conditions expressed or
implied herein and contained in the Bonds, the Authority does hereby grant,
bargain, sell, convey, mortgage, pledge and assign, and grant a security
interest in, the Trust Estate (as hereinafter defined) to the Trustee, its
successors in trust and their assigns forever;
TO HAVE AND TO HOLD all the same with all privileges and appurtenances hereby
conveyed and assigned, or agreed or intended so to be, to the Trustee, its
successors in trust and their assigns forever;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth,first, for
the equal and proportionate benefit and security of all Owners of the Bonds
issued under and secured by this Indenture without preference, priority or
distinction as to the lien of any Bonds over any other Bonds;
PROVIDED, HOWEVER, that if, after the right, title and interest of the
Trustee in and to the Trust Estate shall have ceased,terminated and become void
in accordance with Article VIII hereof, the principal of and premium, if any,
and interest on the Bonds shall have been paid to the Owners thereof, or shall
have been paid to the Company pursuant to Section 4.06 hereof, then and in that
case these presents and the estate and rights hereby granted shall cease,
terminate and be void,and thereupon the Trustee shall cancel and discharge this
Indenture and execute and deliver to the Authority and the Company such
instruments in writing as shall be requisite to evidence the discharge hereof;
otherwise this Indenture is to be and remain in full force and effect.
THIS INDENTURE OF TRUST FURTHER WITNESSETH, and it is expressly declared,
that all Bonds issued and secured hereunder are to be issued, authenticated and
delivered, and the Trust Estate and the other estate and rights hereby granted
are to be dealt with and disposed of, under, upon and subject to the terms,
conditions, stipulations, covenants, agreements, trusts, uses and purposes as
hereinafter expressed, and the Authority has agreed and covenanted, and does
hereby agree and covenant, with the Trustee and with the respective Owners,from
time to time, of the Bonds, as follows:
DEFINITIONS
Section I.01. Definitions
The terms defined in this Article I shall, for all purposes of this Indenture,
have the meanings herein specified, unless the context clearly requires
otherwise:
Act:
"Act" shall mean Title 35, Chapter 5, Arizona Revised Statutes, and all acts
supplemental thereto or amendatory thereof.
Authority:
"Authority" shall mean The Industrial Development Authority of the County of
Apache, an Arizona nonprofit corporation designated by law as a political
subdivision of the State of Arizona incorporated for and with the approval of
Apache County, Arizona, pursuant to the provisions of the Constitution of the
State of Arizona and the Act, its successors and their assigns.
Authorized Company Representative:
"Authorized Company Representative" shall mean each person at the time
designated to act on behalf of the Company by written certificate furnished to
the Authority and the Trustee containing the specimen signature of such person
and signed on behalf of the Company by its President, any Vice President or its
Treasurer, together with its Secretary or any Assistant Secretary.
Bond Counsel:
"Bond Counsel" shall mean any firm or firms of nationally recognized bond
counsel experienced in matters pertaining to the validity of,and exclusion from
gross income for federal tax purposes of interest on bonds issued by states and
political subdivisions,selected by the Company and acceptable to the Authority.
Bond Fund:
"Bond Fund" shall mean the fund created by Section 4.01 hereof.
Bonds:
"Bond" or "Bonds" shall mean the bonds authorized to be issued under this
Indenture.
Code:
"Code" shall mean the Internal Revenue Code of 1986 or any successor statute
thereto. Each reference to a section of the Code herein shall be deemed to
include the United States Treasury Regulations proposed or in effect thereunder
and applicable to the Bonds or the use of proceeds thereof, unless the context
clearly requires otherwise. References to any particular Code section shall,
in the event of a successor Code, be deemed to be a reference to the successor
to such Code section.
Company:
"Company" shall mean Tucson Electric Power Company, a corporation organized
and existing under the laws of the State of Arizona, its successors and their
assigns, including, without limitation,any successor obligor under Section 6.01
or 7.01 of the Loan Agreement to the extent of the obligations assumed
thereunder.
Depositary:
"Depositary" shall mean The Depository Trust Company or any successor thereto
as a securities repository for the Bonds.
Facilities:
"Facilities" shall mean the air and water pollution control facilities and
sewage and solid waste disposal systems and facilities as well as other real
and personal properties, facilities,machinery and equipment currently existing,
under construction and to be constructed at the Plant which are described in
Exhibit A to the Loan Agreement, as revised from time to time to reflect any
changes therein, additions thereto, substitutions therefor and deletions
therefrom permitted by the terms of the Loan Agreement,subject, however, to the
provisions of Section 7.01 of the Loan Agreement.
Government Obligations:
"Government Obligations" shall mean:
(a) direct obligations of, or obligations the principal of and interest on
which are unconditionally guaranteed by, the United States of America
entitled to the benefit of the full faith and credit thereof; and
(b) certificates,depositary receipts or other instruments which evidence a
direct ownership interest in obligations described in clause (a) above or in
any specific interest or principal payments due in respect thereof; provided,
however, that the custodian of such obligations or specific interest or
principal payments shall be a bank or trust company organized under the laws
of the United States of America or of any state or territory thereof or of
the District of Columbia, with a combined capital stock surplus and undivided
profits of at least $50,000,000; and provided, further, that except as may be
otherwise required by law, such custodian shall be obligated to pay to the
holders of such certificates, depositary receipts or other instruments the
full amount received by such custodian in respect of such obligations or
specific payments and shall not be permitted to make any deduction therefrom.
Indenture:
"Indenture" shall mean this Indenture of Trust, dated as of March 1, 1998,
between the Authority and the Trustee, and any and all modifications,
alterations, amendments and supplements thereto.
Investment Securities:
"Investment Securities" shall mean any of the following obligations or
securities on which neither the Company nor any of its subsidiaries is the
obligor: (a) Government Obligations; (b) interest bearing deposit accounts
(which may be represented by certificates of deposit) in national, state or
foreign banks having a combined capital and surplus of not less than
$10,000,000; (c) bankers' acceptances drawn on and accepted by commercial banks
having a combined capital and surplus of not less than $10,000,000; (d) (i)
direct obligations of, (ii) obligations the principal of and interest on which
are unconditionally guaranteed by, and (iii) any other obligations the interest
on which is exempt from federal income taxation issued by, any state of the
United States of America,the District of Columbia or the Commonwealth of Puerto
Rico, or any political subdivision, agency, authority or other instrumentality
of any of the foregoing, which, in any case, are rated by a nationally
recognized rating agency in any of its three highest rating categories; (e)
obligations of any agency or instrumentality of the United States of America;
(f)commercial or finance company paper which is rated by a nationally
recognized rating agency in any of its three highest rating categories; (g)
corporate debt securities issued by corporations having debt securities rated
by a nationally recognized rating agency in any of its three highest rating
categories; (h)repurchase agreements with banking or financial institutions
having a combined capital and surplus of not less than $10,000,000 with respect
to any of the foregoing obligations or securities; (i) shares or interests in
registered investment companies whose assets consist of obligations or
securities which are described in any other clause of this sentence; and
(j) any other obligations which may lawfully be purchased by the Trustee.
The commercial banks and banking institutions referred to above may include
the entities acting as Trustee, Paying Agent, Co-Paying Agent or Registrar
hereunder if such entities shall otherwise satisfy the requirements set
forth above.
Loan Agreement:
"Loan Agreement" shall mean the Loan Agreement, dated as of March 1, 1998,
between the Authority and the Company relating to the Bonds, and any and all
modifications, alterations, amendments and supplements thereto.
Loan Payments:
"Loan Payments" shall mean the payments required to be made by the Company
pursuant to Section 5.01 of the Loan Agreement.
1954 Code:
"1954 Code" shall mean the Internal Revenue Code of 1954, as amended.
1981 Series A Bonds:
"1981 Series A Bonds" shall mean the $100,000,000 aggregate principal amount
of the Authority's Pollution Control Revenue Bonds, 1981 Series A (Tucson
Electric Power Company Project).
1981 Series B Bonds:
"1981 Series B Bonds" shall mean the $100,000,000 aggregate principal amount
of the Authority's Pollution
Control Revenue Bonds, 1981 Series B (Tucson Electric Power Company Project).
Notice by Mail:
"Notice by Mail" or "notice" of any action or condition "by Mail" shall mean
a written notice meeting the requirements of this Indenture mailed by
first-class mail to the Owners of specified registered Bonds at the addresses
shown in the registration books maintained pursuant to Section 2.08 hereof;
provided, however, that if, because of the temporary or permanent suspension of
delivery of first-class mail or for any other reason, it is impossible or
impracticable to give such notice by first-class mail, then such giving of
notice in lieu thereof,which may include publication, as shall be made with the
approval of the Trustee (or, if there be no trustee hereunder, the Authority)
shall constitute a sufficient giving of such notice.
Notice by Publication:
"Notice by Publication" or "notice" of any action or condition "by
Publication"shall mean publication of a notice meeting the requirements of this
Indenture in a
newspaper or financial journal of general circulation in The City of New York,
New York, which carries financial news, is printed in the English language and
is customarily published on each business day; provided, however, that any
successive weekly publication of notice required hereunder may be made, unless
otherwise expressly provided herein, on the same or different days of the week
and in the same or different newspapers or financial journals; and provided,
further, that if, because of the temporary or permanent suspension of the
publication or general circulation of any newspaper or financial journal or for
any other reason, it is impossible or impracticable to publish such notice in
the manner herein described, then such publication in lieu thereof as shall be
made with the approval of the Trustee (or, if there be no trustee hereunder,the
Authority) shall constitute a sufficient publication of such notice.
Outstanding:
"Outstanding", when used in reference to the Bonds, shall mean, as at any
particular date, the aggregate of all Bonds authenticated and delivered under
this Indenture except:
(a) those canceled by the Trustee at or prior to such date or delivered to
or acquired by the Trustee at or prior to such date for cancellation;
(b) those deemed to be paid in accordance with Article VIII hereof; and
(c) those in lieu of or in exchange or substitution for which other Bonds
shall have been authenticated and delivered pursuant to this Indenture,
unless proof satisfactory to the Trustee and the Company is presented that
such Bonds are held by a bona fide holder in due course.
Owner:
"Owner" shall mean the person in whose name any Bond is registered upon the
registration books maintained pursuant to Section 2.08 hereof. The Company may
be an Owner.
Paying Agent; Co-Paying Agent; Principal Office thereof:
"Paying Agent" and "Co-Paying Agent" shall mean the paying agent and any
co-paying agent appointed in accordance with Section 10.21 hereof. "Principal
Office"of the Paying Agent or any Co-Paying Agent shall mean the office thereof
designated in writing to the Trustee.
Plant:
"Plant" shall mean Unit No. 2 of the Springerville Generating Station, an
electric power generating plant located near Springerville, Arizona, in Apache
County, Arizona, and any additions or improvements thereto or replacements
thereof.
Rebate Fund:
"Rebate Fund" shall mean the fund created by Section 7.08 hereof.
Receipts and Revenues of the Authority from the Loan Agreement:
"Receipts and Revenues of the Authority from the Loan Agreement" shall mean
all moneys paid or payable to the Trustee for the account of the Authority by
the Company in respect of the Loan Payments and payments pursuant to Section
9.01 of the Loan Agreement and all receipts of the Trustee which, under the
provisions of this Indenture, reduce the amount of such payments.
Record Date:
"Record Date" shall mean the close of business on the fifteenth (15th) day of
the calendar month immediately preceding each regularly scheduled interest
payment date.
Registrar; Principal Office thereof:
"Registrar" shall mean the registrar appointed in accordance with Section
10.23 hereof. "Principal Office" of the Registrar shall mean the office thereof
designated in writing to the Trustee.
Supplemental Indenture:
"Supplemental Indenture" shall mean any indenture of the Authority modifying,
altering, amending, supplementing or confirming this Indenture for any purpose,
in accordance with the terms hereof.
Supplemental Loan Agreement:
"Supplemental Loan Agreement" shall mean any agreement between the Authority
and the Company modifying, altering, amending or supplementing the Loan
Agreement, in accordance with the terms thereof and hereof.
Tax Agreement:
"Tax Agreement" shall mean that tax certificate and agreement, dated the date
of the initial authentication and delivery of the Bonds, between the Authority
and the Company, relating to the requirements of the Code and the 1954 Code,and
any and all modifications, alterations, amendments and supplements thereto.
Trust Estate:
"Trust Estate" shall mean at any particular time all right, title and
interest of the Authority in and to the Loan Agreement (except its rights under
Sections 5.03, 5.04, 6.03 and 8.05 thereof and any rights of the Authority to
receive notices, certificates, requests, requisitions and other communications
thereunder), including without limitation, the Receipts and Revenues of the
Authority from the Loan Agreement, the Bond Fund and all moneys and Investment
Securities from time to time on deposit therein (excluding, however, any moneys
or Investment Securities held in the Rebate Fund), any and all other moneys and
obligations (other than Bonds) which at such time are deposited or are required
to be deposited with, or are held or are required to be held by or on behalf
of, the Trustee, the Paying Agent or any Co-Paying Agent in trust under any of
the provisions of this Indenture and all other rights,titles and interests
which at such time are subject to the lien of this Indenture; provided, however,
that in no event shall there be included in the Trust Estate (a) moneys or
obligations deposited with or held by the Trustee in the Rebate Fund pursuant
to Section 7.08 hereof or(b) moneys or obligations deposited with or paid to
the Trustee for the redemption or payment of Bonds which are deemed to have
been paid in accordance with Article VIII hereof or moneys held pursuant to
Section 4.06 hereof.
Trustee; Principal Office thereof:
"Trustee" shall mean First Trust of New York, National Association, as
trustee under this Indenture, its successors in trust and their assigns.
"Principal Office" of the Trustee shall mean the principal corporate trust
office of the Trustee, which office at the date of acceptance by the Trustee of
the duties and obligations imposed on the Trustee by this Indenture is located
at the address specified in Section 13.08 hereof.
ARTICLE II
THE BONDS
Section II.01. Creation of Bonds. There is hereby authorized and created
under this Indenture, for the purpose of providing moneys to pay, or redeem, or
provide for the redemption therefor, of the $41,400,000 aggregate principal
amount of the 1981 Series A Bonds and $58,400,000 aggregate principal amount
of the 1981 Series B Bonds, an issue of Bonds, entitled to the benefit,
protection and security of this Indenture, in the aggregate principal amount of
Ninety Nine Million Eight Hundred Thousand Dollars ($99,800,000). Each of the
Bonds shall be designated by the title "The Industrial Development Authority of
the County of Apache Pollution Control Revenue Bond, 1998 Series B (Tucson
Electric Power Company Project)". The Bonds shall mature, subject to prior
redemption upon the terms and conditions hereinafter set forth, on March 1,
2033 and shall bear interest from the date thereof until payment of the
principal or redemption price thereof shall have been made or provided for in
accordance with the provisions hereof, whether at maturity, upon redemption
or otherwise, at the rate of five and seven eighths per centum (5_%) per annum,
with interest thereon payable semi-annually on each March 1 and September 1
commencing September 1, 1998. Interest shall be calculated on the basis of
a 360-day year consisting of twelve 30-day months.
Section II.02. Form of Bonds.
Bonds shall be authenticated and delivered hereunder solely as fully
registered bonds without coupons in the denomination of $5,000 or integral
multiples thereof. Bonds shall be numbered as determined by the Trustee. Bonds
authenticated prior to the first interest payment date shall be dated March 1,
1998. Bonds authenticated on or subsequent to the first interest payment date
shall be dated the interest payment date next preceding the date of
authentication thereof, unless such date of authentication shall be an interest
payment date to which interest on the Bonds has been paid in full or duly
provided for, in which case they shall be dated such date of authentication;
provided, however, that if, as shown by the records of the Trustee, interest on
the Bonds shall be in default, Bonds issued in exchange for Bonds surrendered
for transfer or exchange shall be dated the date to which interest has been
paid in full on the Bonds surrendered.
Principal of and premium, if any, on Bonds shall be payable to the Owners of
such Bonds upon presentation and surrender of such Bonds at the Principal
Office of the Paying Agent or any Co-Paying Agent. Interest on the Bonds shall
be paid by check drawn upon the Paying Agent and mailed to the Owners of such
Bonds as of the close of business on the Record Date with respect to each
interest payment date at the registered addresses of such Owners as they shall
appear as of the close of business on such Record Date on the registration
books maintained pursuant to Section 2.08 hereof notwithstanding the
cancellation of any such Bond upon any exchange or registration of transfer
subsequent to such Record Date, except that if and to the extent that there
should be a default on the payment of interest on any Bond, such defaulted
interest shall be paid to the Owners in whose name such Bond (or any Bond or
Bonds issued upon any exchange or registration of transfer thereof) is
registered as of the close of business on a date selected by the Trustee
in its discretion, but not more than 15 days or less than 10 days prior
to the date of payment of such defaulted interest; notwithstanding the
foregoing, upon request to the Paying Agent by an Owner of not less than
$1,000,000 in aggregate principal amount of Bonds, interest on such Bonds
and, after presentation and surrender of such Bonds, the principal thereof
shall be paid to such Owner by wire transfer to the account maintained within
the continental United States specified by such Owner or, if such Owner
maintains an account with the entity acting as Paying Agent, by deposit
into such account. Payment as aforesaid shall be made in such coin or
currency of the United States of America as, at the respective times of
payment, shall be legal tender for the payment of public and private debts.
The Bonds and the form for registration of transfer and the form of
certificate of authentication to be printed on the Bonds are to be in
substantially the forms thereof set forth in Exhibits A, B and C hereto,
respectively, with necessary or appropriate variations,omissions and
insertions as permitted or required by this Indenture.
Section II.03. Execution of Bonds.
The Bonds shall be executed on behalf of the Authority by the President or
a Vice President of the Authority and shall have affixed, impressed or
reproduced thereon the official seal of the Authority which shall be
attested by the Secretary or an Assistant Secretary of the Authority.
Each of the foregoing officers may execute or cause to be executed
with a facsimile signature in lieu of his manual signature the Bonds,
provided the signature of either the President or a Vice President of the
Authority or the Secretary or Assistant Secretary of the Authority shall, if
required by applicable laws, be manually subscribed.
In case any officer of the Authority whose signature or a facsimile of whose
signature shall appear on the Bonds shall cease to be such officer before the
authentication by the Trustee and delivery of such Bonds,such signature or such
facsimile shall nevertheless be valid and sufficient for all purposes, the same
as if such officer had remained in office until delivery; and any Bond may be
signed on behalf of the Authority by such persons as, at the time of execution
of such Bond, shall be the proper officers of the Authority, even though at the
date of such Bond or of the execution and delivery of this Indenture any such
person was not such officer.
Section II.04. Authentication of Bonds.
Only such Bonds as shall have endorsed thereon a certificate of
authentication substantially in the form set forth in Exhibit C hereto duly
executed by the Trustee shall be entitled to any right or benefit under this
Indenture. No Bond shall be valid or obligatory for any purpose unless and
until such certificate of authentication shall have been duly executed by the
Trustee,and such executed certificate of authentication of the Trustee upon any
such Bonds shall be conclusive evidence that such Bond has been authenticated
and delivered under this Indenture. The Trustee's certificate of authentication
on any Bond shall be deemed to have been executed by it if signed with an
authorized signature of the Trustee,but it shall not be necessary that the same
person sign the certificate of authentication on all of the Bonds issued
hereunder. This Section 2.04 is subject to the provisions of Section 10.17
hereof.
Section II.05. Bonds Not General Obligations.
Neither Apache County, Arizona nor the State of Arizona shall in any event
be liable for the payment of the principal of or premium, if any,
or interest on the Bonds, and neither the Bonds nor the premium, if any,
or the interest thereon, shall be construed to constitute an indebtedness
of Apache County,Arizona or the State of Arizona within the meaning of any
constitutional or statutory provisions whatsoever. The Bonds and the premium,
if any, and the interest thereon shall be limited obligations of the Authority
payable solely from the Receipts and Revenues of the Authority from the Loan
Agreement and the other moneys pledged therefor under this Indenture,
and such fact shall be plainly stated on the face of each Bond.
Section II.06. Prerequisites to Authentication of Bonds. The Authority
shall execute and deliver to the Trustee and the Trustee shall authenticate the
Bonds and deliver said Bonds to the initial purchasers thereof as may be
directed hereinafter in this Section 2.06.
Prior to the delivery on original issuance by the Trustee of any
authenticated Bonds there shall be or have been delivered to the Trustee:
(a) a duly certified copy of a resolution of the Board of Directors of the
Authority authorizing the execution and delivery of this Indenture and the
Loan Agreement and the issuance of the Bonds;
(b) an original duly executed counterpart or a duly certified copy of the
Loan Agreement;
(c) a request and authorization to the Trustee on behalf of the Authority,
signed by a duly authorized officer of the Authority, to authenticate and
deliver the Bonds in the aggregate principal amount determined by this
Indenture to the purchaser or purchasers therein identified upon payment to
the Trustee, but for the account of the Authority, of a sum specified in such
request and authorization plus any accrued interest on such Bonds to the date
of delivery; and
(d) a written statement on behalf of the Company, executed by the
President, any Vice President or the Treasurer, (i) approving the issuance
and delivery of the Bonds and (ii) consenting to each and every provision of
this Indenture.
Section II.07. Lost or Destroyed Bonds or Bonds Canceled in Error.
If any Bond, whether in temporary or definitive form, is lost
(whether by reason of theft or otherwise), destroyed (whether by mutilation,
damage, in whole or in part, or otherwise) or canceled in error, the Authority
may execute and the Trustee may authenticate a new Bond of like date and
denomination and bearing a number not contemporaneously outstanding; provided
that (a) in the case of any mutilated Bond, such mutilated Bond shall first be
surrendered to the Trustee and (b) in the case of any lost Bond or Bond
destroyed in whole, there shall be first furnished to the Authority,the Trustee
and the Company evidence of such loss or destruction. In every case, the
applicant for a substitute Bond shall furnish the Authority,the Trustee and the
Company such security or indemnity as may be required by any of them. In the
event any lost or destroyed Bond or a Bond canceled in error shall have matured
or is about to mature, or has been called for redemption, instead of issuing a
substitute Bond the Trustee may, in its discretion, pay the same without
surrender thereof if there shall be first furnished to the Authority, the
Trustee and the Company evidence of such loss, destruction or cancellation,
together with indemnity, satisfactory to them. Upon the issuance of any
substitute Bond, the Authority and the Trustee may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto. The Trustee may charge the Owner of any such Bond
with the Trustee's reasonable fees and expenses in connection with any
transaction described in this Section 2.07.
Every substitute Bond issued pursuant to the provisions of this Section 2.07
by virtue of the fact that any Bond is lost, destroyed or canceled in error
shall constitute an additional contractual obligation of the Authority, whether
or not the Bond so lost,destroyed or canceled shall be at any time enforceable,
and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Bonds duly issued hereunder. All Bonds
shall be held and owned upon the express condition that,to the extent permitted
by law, the foregoing provisions are exclusive with respect to the replacement
or payment of lost, destroyed or improperly canceled Bonds, notwithstanding any
law or statute now existing or hereafter enacted.
Section II.08. Transfer, Registration and Exchange of Bonds. The Registrar
shall maintain and keep, at its Principal Office,books for the registration and
registration of transfer of Bonds, which, at all reasonable times,shall be open
for inspection by the Authority, the Trustee and the Company; and, upon
presentation for such purpose of any Bond entitled to registration or
registration of transfer at the Principal Office of the Registrar, the
Registrar shall register or register the transfer in such books, under such
reasonable regulations as the Registrar may prescribe. The Registrar shall
make all necessary provisions to permit the exchange or registration of
transfer of Bonds at its Principal Office.
The transfer of any Bond shall be registered upon the registration books of
the Registrar at the written request of the Owner thereof or his attorney duly
authorized in writing, upon surrender thereof at the Principal Office of the
Registrar, together with a written instrument of transfer satisfactory to the
Registrar duly executed by the Owner or his duly authorized attorney. Upon the
registration of transfer of any such Bond or Bonds,the Authority shall issue in
the name of the transferee, in authorized denominations, a new Bond or Bonds in
the same aggregate principal amount as the surrendered Bond or Bonds.
The Authority, the Trustee, the Paying Agent, any Co-Paying Agent and the
Registrar may deem and treat the Owner of any Bond as the absolute owner of
such Bond,whether such Bond shall be overdue or not,for the purpose of
receiving payment of, or on account of, the principal of and premium, if any,
and, except as provided in Section 2.02 hereof, interest on, such Bond and
for all other purposes, and neither the Authority, the Trustee, the Paying
Agent, any Co-Paying Agent nor the Registrar shall be affected by any notice
to the contrary. All such payments so made to any such Owner or upon his order
shall be valid and effective to satisfy and discharge the liability upon such
Bond to the extent of the sum or sums so paid.
Bonds, upon surrender thereof at the Principal Office of the Registrar may,
at the option of the Owner thereof, be exchanged for an equal aggregate
principal amount of Bonds of any authorized denomination.
In all cases in which the privilege of exchanging Bonds or registering the
transfer of Bonds is exercised, the Authority shall execute and the Trustee
shall authenticate and deliver Bonds in accordance with the provisions of
this Indenture. For every such exchange or registration of transfer of Bonds,
whether temporary or definitive, the Authority, the Registrar, or the Trustee
may make a charge sufficient to reimburse it for any tax or other governmental
charge required to be paid with respect to such exchange or registration of
transfer,which sum or sums shall be paid by the person requesting such exchange
or registration of transfer as a condition precedent to the exercise of the
privilege of making such exchange or registration of transfer. The Registrar
shall not be obligated (a)to make any such exchange or registration of transfer
of Bonds during the fifteen(15) days next preceding the date on which notice of
any proposed redemption of Bonds is given or (b) to make any exchange or
registration of transfer of any Bonds called for redemption.
The Bonds are to be initially registered in the name of Cede & Co., as
nominee for the Depositary. Such Bonds shall not be transferable or
exchangeable,nor shall any purported transfer be registered, except as follows:
(a) such Bonds may be transferred in whole,and appropriate registration of
transfer effected, if such transfer is by such nominee to the Depositary, or
by the Depositary to another nominee thereof, or by any nominee of the
Depositary to any other nominee thereof, or by the Depositary or any nominee
thereof to any successor securities depositary or any nominee thereof; and
(b) such Bond may be exchanged for definitive Bonds registered in the
respective names of the beneficial holders thereof, and thereafter shall be
transferable without restriction, if:
(i) the Depositary shall have notified the Company and the Trustee that it
is unwilling or unable to continue to act as securities depositary with
respect to such Bonds and the Trustee shall not have been notified by the
Company within ninety (90) days of the identity of a successor securities
depositary with respect to such Bonds;
(ii) the Company shall have delivered to the Trustee a written instrument
to the effect that such Bonds shall be so exchangeable on and after a date
specified therein; or
(iii) (1) an Event of Default shall have occurred and be continuing, (2)
the Trustee shall have given notice of such Event of Default pursuant to
Section 10.19 hereof and (3) there shall have been delivered to the
Authority, the Company and the Trustee an opinion of counsel to the effect
that the interests of the beneficial owners of such Bonds in respect thereof
will be materially impaired unless such owners become owners of definitive
Bonds.
The Bonds delivered to the Depositary may contain a legend reflecting the
foregoing restrictions on registration of transfer and exchange.
Section II.09. Other Obligations.
The Authority expressly reserves the right to issue, to the extent permitted
by law, but shall not be obligated to issue, obligations under another
indenture or indentures to provide additional funds to pay the cost of
construction of the Facilities or to refund all or any principal amount of the
Bonds, or any combination thereof.
Section II.10 Temporary Bonds.
Pending the preparation of definitive Bonds, the Authority may execute
and the Trustee shall authenticate and deliver temporary Bonds. Temporary Bonds
shall be issuable as registered Bonds without coupons, of any authorized
denomination, and substantially in the form of the definitive Bonds but with
such omissions, insertions and variations as may be appropriate for temporary
Bonds, all as may be determined by the Authority. Temporary Bonds may contain
such reference to any provisions of this Indenture as may be appropriate. Every
temporary Bond shall be executed by the Authority and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Bonds. As promptly as practicable the Authority
shall execute and shall furnish definitive Bonds and thereupon temporary Bonds
may be surrendered in exchange therefor without charge at the Principal Office
of the Trustee, and the Trustee shall authenticate and deliver in exchange for
such temporary Bonds a like aggregate principal amount of definitive Bonds of
authorized denominations. Until so exchanged the temporary Bonds shall be
entitled to the same benefits under this Indenture as definitive Bonds.
Section II.11. Cancellation of Bonds. All Bonds which shall have been
surrendered to the Paying Agent or any Co-Paying Agent for payment or
redemption, and all Bonds which shall have been surrendered to the Registrar
for exchange or registration of transfer, shall be delivered to the Trustee
for cancellation. All Bonds delivered to or acquired by the Trustee for
cancellation shall be canceled and destroyed by the Trustee. The Trustee
shall furnish to the Authority, the Paying Agent, the Registrar and the
Company counterparts of certificates evidencing such cancellation and
destruction and specifying such Bonds by number.
Section II.12. Payment of Principal and Interest.
For the payment of interest on the Bonds, the Authority shall cause to be
deposited in the Bond Fund, on each interest payment date, solely out of the
Receipts and Revenues of the Authority from the Loan Agreement and other
moneys pledged therefor, an amount sufficient to pay the interest to become
due on such interest payment date. The obligation of the Authority to
cause any such deposit to be made hereunder shall be reduced by the amount of
moneys in the Bond Fund available on such interest payment date for the payment
of interest on the Bonds.
For the payment of the principal of the Bonds upon maturity, the Authority
shall cause to be deposited in the Bond Fund, on the stated or accelerated date
of maturity, solely out of the Receipts and Revenues of the Authority from the
Loan Agreement and other moneys pledged therefor, an amount sufficient to pay
the principal of the Bonds. The obligation of the Authority to cause any such
deposit to be made hereunder shall be reduced by the amount of moneys in the
Bond Fund available on the maturity date for the payment of the principal of
the Bonds.
Section II.13. Applicability of Book-Entry Provisions. Anything in this
Indenture to the contrary notwithstanding, (a) the provisions of the Blanket
Issuer Letter of Representations, dated February 17,1998, between the Authority
and The Depository Trust Company relating to the manner of and procedures for
payment and redemption of Bonds and related matters shall apply so long as such
Depositary shall be the Owner of all Outstanding Bonds and (b) the Authority,
the Trustee or the Paying Agent, as applicable, may enter into a similar
agreement, on terms satisfactory to the Company, with any subsequent Depositary
and the provisions thereof shall apply so long as such Depositary shall be the
Owner of all Outstanding Bonds.
ARTICLE III
REDEMPTION OF BONDS
Section III.01. Redemption Provisions.
(a) The Bonds shall be subject to redemption by the Authority, at the
direction of the Company, on any date on or after March 1, 2003 in whole
at any time or in part from time to time, at the applicable redemption
price (expressed as a percentage of principal amount) set forth below,
plus accrued interest to the redemption date:
Redemption Period Redemption Price
March 1, 2003 through February 29, 2004 102%
March 1, 2004 through February 28, 2005 101%
March 1, 2005 and thereafter 100%
(b) The Bonds shall be subject to redemption by the Authority, at the
direction of the Company, in whole at any time at the principal amount thereof
plus accrued interest to the redemption date, if:
(i) the Company shall have determined that the continued operation of the
Facilities or the Plant is impracticable, uneconomical or undesirable for any
reason;
(ii) all or substantially all of the Facilities or the Plant shall have been
condemned or taken by eminent domain; or
(iii) the operation of the Facilities or the Plant shall have been enjoined
or shall have otherwise been prohibited by, or shall conflict with, any
order, decree, rule or regulation of any court or of any federal, state or
local regulatory body, administrative agency or other governmental body.
(c) The Bonds shall be subject to mandatory redemption by the Authority, at
the principal amount thereof plus accrued interest to the redemption date, on
the 180th day (or such earlier date as may be designated by the Company)after a
final determination by a court of competent jurisdiction or an administrative
agency, to the effect that, as a result of a failure by the Company to perform
or observe any covenant, agreement or representation contained in the Loan
Agreement, the interest payable on the Bonds is included for federal income tax
purposes in the gross income of the owners thereof, other than any owner of a
Bond who is a "substantial user" of the Facilities or a "related person" within
the meaning of Section 103(b)(13) of the 1954 Code. No determination by any
court or administrative agency shall be considered final for the purposes of
this Section 3.01 (c) unless the Company shall have been given timely notice of
the proceeding which resulted in such determination and an opportunity to
participate in such proceeding, either directly or through an owner of a Bond,
and until the conclusion of any appellate review sought by any party to
such proceeding or the expiration of the time for seeking such review. The
Bonds shall be redeemed either in whole or in part in such principal amount
that, in the opinion of Bond Counsel, the interest payable on the Bonds,
including the Bonds remaining outstanding after such redemption, would not be
included in the gross income of any owner thereof,other than an owner of a Bond
who is a "substantial user" of the Facilities or a "related person" within the
meaning of Section 103(b)(13) of the 1954 Code.
Section III.02. Selection of Bonds to be Redeemed. If less than all the
Bonds shall be called for redemption under any provision of this Indenture
permitting such partial redemption,the particular Bonds or portions of Bonds to
be redeemed shall be selected by the Trustee, in such manner as the Trustee in
its discretion may deem proper, in the aggregate principal amount designated to
the Trustee by the Company or otherwise as required by this Indenture;provided,
however, that if, as indicated in a certificate of an Authorized Company
Representative delivered to the Trustee, the Company shall have offered to
purchase all Bonds then Outstanding and less than all such Bonds have been
tendered to the Company for such purchase, the Trustee, at the direction of an
Authorized Company Representative, shall select for redemption all such Bonds
which shall not have been so tendered; and provided, further, that the portion
of any Bond to be redeemed shall be in the principal amount of $5,000 or some
integral multiple thereof and that, in selecting Bonds for redemption, the
Trustee shall treat each Bond as representing that number of Bonds which is
obtained by dividing the principal amount of such Bond by $5,000. If it is
determined that one or more, but not all, of the $5,000 units of principal
amount represented by any such Bond is to be called for redemption, then, upon
notice of intention to redeem such $5,000 unit or units, the Owner of such Bond
shall forthwith surrender such Bond to the Paying Agent or any Co-Paying Agent
for (y) payment to such Owner of the redemption price (including the redemption
premium, if any, and accrued interest to the date fixed for redemption) of the
$5,000 unit or units of principal amount called for redemption and (z) delivery
to such Owner of a new Bond or Bonds in the aggregate principal amount of the
unredeemed balance of the principal amount of any such Bond. Bonds
representing the unredeemed balance of the principal amount of any such Bond
shall be delivered to the Owner thereof, without charge therefor. If the
Owner of any such Bond of a denomination greater than $5,000 shall fail to
present such Bond to the Paying Agent or any Co-Paying Agent for payment and
exchange as aforesaid, such Bond shall, nevertheless, become due and payable
on the date fixed for redemption to the extent of the $5,000 unit or units of
principal amount called for redemption (and to that extent only).
Section III.03. Procedure for Redemption.
(a)In the event any of the Bonds are called for redemption, the Trustee shall
give notice,in the name of the Authority,of the redemption of such Bonds, which
notice shall (i) specify the Bonds to be redeemed, the redemption date, the
redemption price,and the place or places where amounts due upon such redemption
will be payable (which shall be the Principal Office of the Paying Agent or any
Co-Paying Agent) and, if less than all of the Bonds are to be redeemed, the
numbers of the Bonds to be redeemed,and the portion of the principal amount of
any Bond to be redeemed in part,(ii) state any condition to such redemption and
(iii) state that on the redemption date, and upon the satisfaction of any such
condition, the Bonds or portions thereof to be redeemed shall cease to bear
interest. Such notice may set forth any additional information relating to such
redemption. Such notice shall be given by Mail at least thirty (30) days prior
to the date fixed for redemption to the Owners of the Bonds to be redeemed;
provided, however, that failure duly to give such Notice by Mail, or any defect
therein, shall not affect the validity of any proceedings for the redemption of
Bonds as to which there shall have been no such failure or defect. If a notice
of redemption shall be unconditional, or if the conditions of a conditional
notice or redemption shall have been satisfied, then upon presentation and
surrender of Bonds so called for redemption at the place or places of payment,
such Bonds shall be redeemed. The Trustee shall promptly deliver to the
Company a copy of each such notice of redemption.
(b) With respect to any notice of redemption of Bonds in accordance with
subsection (a) or (b) of Section 3.01 hereof, unless, upon the giving of such
notice, such Bonds shall be deemed to have been paid within the meaning of
Article VIII hereof, such notice shall state that such redemption shall be
conditional upon the receipt, by the Trustee at or prior to the opening of
business on the date fixed for such redemption, of moneys sufficient to pay the
principal of and premium, if any, and interest on such Bonds to be redeemed,and
that if such moneys shall not have been so received said notice shall be of no
force and effect and the Authority shall not be required to redeem such Bonds.
In the event that such notice of redemption contains such a condition and such
moneys are not so received, the redemption shall not be made and the Trustee
shall within a reasonable time thereafter give notice, in the manner in which
the notice of redemption was given, that such moneys were not so received.
(c) Any Bonds and portions of Bonds which have been duly selected for
redemption shall cease to bear interest on the specified redemption date
provided that moneys sufficient to pay the principal of, premium, if any, and
interest on such Bonds shall be on deposit with the Trustee on the date fixed
for redemption so that such Bonds will be deemed to be paid in accordance with
Article VIII hereof.
Section III.04. Payment of Redemption Price.
For the redemption of any of the Bonds, the Authority shall cause to be
deposited in the Bond Fund, on the redemption date, solely out of the Receipts
and Revenues of the Authority from the Loan Agreement, an amount sufficient to
pay the principal of and premium, if any, and interest to become due on such
redemption date. The obligation of the Authority to cause any such deposit
to be made hereunder shall be reduced by the amount of moneys in the Bond
Fund available on such redemption date for payment of the principal of and
premium, if any, and accrued interest on the Bonds to be redeemed.
Section III.05. No Partial Redemption After Default. Anything in this
Indenture to the contrary notwithstanding, if there shall have occurred and be
continuing an Event of Default defined in clause (a) or (b) of the first
paragraph of Section 9.01 hereof, there shall be no redemption of less than all
of the Bonds at the time Outstanding other than a partial redemption in
connection with an offer by the Company to purchase all Bonds Outstanding as
contemplated in the first proviso to the first sentence of Section 3.02 hereof.
ARTICLE IV
THE BOND FUND
Section IV.01. Creation of Bond Fund.
There is hereby created and established with the Trustee a trust fund in the
name of the Authority to be designated "The Industrial Development Authority
of The County of Apache Pollution Control Revenue Bonds, 1998 Series B
(Tucson Electric Power Company Project) Bond Fund". The Trustee shall
establish and maintain within the Bond Fund such segregated subaccounts
as may be requested by an Authorized Company Representative. The Bond Fund,and
all moneys and certificated securities therein, shall be kept in the possession
of the Trustee.
Section IV.02. Liens.
The Authority shall not create any lien upon the Bond Fund or upon the Receipts
and Revenues of the Authority from the Loan Agreement other than the lien
hereby created.
Section IV.03. Deposits into Bond Fund.
(a) There shall be deposited into the Bond Fund:
(i) the accrued interest, if any, on the Bonds accrued to the date of
delivery thereof and paid by the initial purchasers thereof;
(ii) all Loan Payments; and
(iii) all other moneys received by the Trustee under and pursuant to any
provision of the Loan Agreement, other than Sections 5.03, 5.04 and 8.05
thereof, or from any other source when accompanied by directions by the
Company that such moneys are to be paid into the Bond Fund.
(b) All income or other gain from the investment of moneys in the Bond Fund
shall be deposited into the Bond Fund.
Section IV.04. Use of Moneys in Bond Fund.
Moneys, if any, paid into the Bond Fund pursuant to clause (i) of Section 4.03
(a)hereof shall be applied to the payment of interest on the Bonds. Except
as otherwise provided in Sections 4.06, 9.01 and 10.04 hereof, all other moneys
in the Bond Fund constituting part of the Trust Estate shall be used solely for
the payment of the principal of and premium, if any, and interest on the Bonds
as the same shall become due and payable at maturity, upon redemption or
otherwise.
Section IV.05. Custody of Bond Fund; Withdrawal of Moneys. The Bond Fund
shall be in the custody of the Trustee but in the name of the Authority and the
Authority hereby authorizes and directs the Trustee to withdraw from the Bond
Fund and furnish to the Paying Agent funds constituting part of the Trust
Estate sufficient to pay the principal of and premium, if any, and interest on
the Bonds as the same shall become due and payable, and to withdraw from the
Bond Fund funds sufficient to pay any other amounts payable therefrom as the
same shall become due and payable.
Section IV.06. Bonds Not Presented for Payment.
In the event any Bonds shall not be presented for payment when the principal
thereof and premium, if any, thereon become due, either at maturity or at the
date fixed for redemption thereof or otherwise, if moneys sufficient to pay
such Bonds are held by the Paying Agent or any Co-Paying Agent for the benefit
of the Owners thereof, the Paying Agent shall segregate and hold such moneys
in trust, without liability for interest thereon, for the benefit of the
Owners of such Bonds, who shall, except as provided in the following paragraph,
thereafter be restricted exclusively to such fund or funds for the
satisfaction of any claim of whatever nature on their part under this
Indenture or relating to said Bonds.
Any moneys which the Paying Agent shall segregate and hold in trust for the
payment of the principal of and premium, if any, or interest on any Bond and
remaining unclaimed for one year after such principal, premium, if any, or
interest has become due and payable shall, upon the Company's written request
to the Paying Agent, be paid to the Company, with notice to the Trustee of
such action; provided, however, that before the Paying Agent shall be required
to make any such repayment, the Paying Agent shall, at the expense of the
Company cause notice to be given once by Publication to the effect that such
money remains unclaimed and that, after a date specified therein,which shall
not be less than thirty (30) days from the date of such notice by Publication,
any unclaimed balance of such moneys then remaining will be paid to the
Company. After the payment of such unclaimed moneys to the Company, the Owner
of such Bond shall thereafter look only to the Company for the payment thereof,
and all liability of the Authority, the Trustee and the Paying Agent with
respect to such moneys shall thereupon cease.
Section IV.07. Moneys Held in Trust. All moneys and Investment Securities
held by the Trustee in the Bond Fund, and all moneys required to be deposited
with or paid to the Trustee for deposit into the Bond Fund, and all moneys
withdrawn from the Bond Fund and held by the Trustee, the Paying Agent, any
Co-Paying Agent, shall be held by the Trustee, the Paying Agent or any
Co-Paying Agent, as the case may be, in trust, and such moneys and Investment
Securities (other than moneys held pursuant to Section 4.06 hereof and moneys
or Investment Securities held in the Rebate Fund established in furtherance
of the obligations of the Company under clause (b) of Section 6.04 of the
Loan Agreement), while so held or so required to be deposited or paid,
shall constitute part of the Trust Estate and be subject to the lien and
security interest created hereby in favor of the Trustee, for the benefit of
the Owners from time to time of the Bonds. The Company shall have no right,
title or interest in the Bond Fund, except such rights as may arise after the
right, title and interest of the Trustee in and to the Trust Estate and all
covenants, agreements and other obligations of the Authority under this
Indenture shall have ceased, terminated and become void and shall have been
satisfied and discharged in accordance with Article VIII hereof.
ARTICLE V
DISPOSITION OF PROCEEDS
Section V.01. Disposition of Proceeds.
The proceeds from the issuance and sale of the Bonds shall be applied as
provided in Section 4.03 of the Loan Agreement.
ARTICLE VI
INVESTMENTS
Section VI.01. Investments.
The moneys in the Bond Fund shall, at the direction of the Company,
be invested and reinvested in Investment Securities. Any Investment
Securities may be purchased subject to options or other rights in third parties
to acquire the same. Subject to the further provisions of this Section 6.01,
such investments shall be made by the Trustee as directed and designated by the
Company in a certificate of, or telephonic advice promptly confirmed by a
certificate of, an Authorized Company Representative. As and when any amounts
thus invested may be needed for disbursements from the Bond Fund, the Trustee
shall request the Company to designate such investments to be sold or otherwise
converted into cash to the credit of the Bond Fund as shall be sufficient to
meet such disbursement requirements and shall then follow any directions in
respect thereto of an Authorized Company Representative. As long as no Event of
Default (as defined in Section 9.01 hereof) shall have occurred and be
continuing, the Company shall have the right to designate the investments to be
sold and to otherwise direct the Trustee in the sale or conversion to cash of
the investments made with the moneys in the Bond Fund,provided that the Trustee
shall be entitled to conclusively assume the absence of any such Event of
Default unless it has notice thereof within the meaning of Section 10.05
hereof.
ARTICLE VII
GENERAL COVENANTS
Section VII.01. No General Obligations.
Each and every covenant herein made,including all covenants made in the various
sections of this Article VII, is predicated upon the condition that neither
Apache County, Arizona nor the State of Arizona shall in any event be
liable for the payment of the principal of, or premium, if any, or
interest on the Bonds or for the performance of any pledge, mortgage,
obligation or agreement created by or arising out of this Indenture or the
issuance of the Bonds, and further that neither the Bonds, nor the premium, if
any, or interest thereon, nor any such obligation or agreement of the Authority
shall be construed to constitute an indebtedness of Apache County, Arizona or
the State of Arizona within the meaning of any constitutional or statutory
provisions whatsoever. The Bonds and the interest and premium, if any, thereon
shall be limited obligations of the Authority payable solely from the Receipts
and Revenues of the Authority from the Loan Agreement and the other moneys
pledged therefor.
The Authority shall promptly cause to be paid, solely from the sources stated
herein, the principal of and premium, if any, and interest on every Bond issued
under this Indenture at the place, on the dates and in the manner provided
herein and in said Bonds according to the true intent and meaning thereof.
Section VII.02. Performance of Covenants of the Authority; Representations.
The Authority shall faithfully perform at all times any and all covenants,
undertakings, stipulations and provisions contained in this Indenture, in any
and every Bond executed, authenticated and delivered hereunder, and in all
proceedings pertaining thereto. The Authority represents that it is duly
authorized under the Constitution and laws of the State of Arizona to issue
the Bonds authorized hereby, to enter into the Loan Agreement and this
Indenture, and to pledge and assign to the Trustee the Trust Estate,
and that the Bonds in the hands of the Owners thereof are and will be valid and
binding limited obligations of the Authority.
Section VII.03. Maintenance of Rights and Powers; Compliance with
Laws. The Authority shall at all times use its best efforts to maintain
its corporate existence or assure the assumption of its obligations under this
Indenture by any public body succeeding to its powers under the Act; and it
shall at all times use its best efforts to comply with all valid acts, rules,
regulations, orders and directions of any legislative, executive,administrative
or judicial body known to it to be applicable to the Loan Agreement and this
Indenture.
Section VII.04. Enforcement of Obligations of the Company; Amendments.
Upon receipt of written notification from the Trustee, the Authority shall
cooperate with the Trustee in enforcing the obligation of the Company to pay
or cause to be paid all the payments and other costs and charges payable by
the Company under the Loan Agreement. The Authority shall not enter into any
agreement with the Company amending the Loan Agreement without the prior
written consent of the Trustee and compliance with Sections12.06 and 12.07
of this Indenture (a revision to Exhibit A to the Loan Agreement not being
deemed an amendment for purposes of this Section).
Section VII.05. Further Instruments.
The Authority shall, upon the reasonable request of the Trustee,
from time to time execute and deliver such further instruments and
take such further action as may be reasonable and as may be required to carry
out the purposes of this Indenture; provided, however, that no such instruments
or actions shall pledge the credit or taxing power of the State of Arizona,
Apache County, the Authority or any other political subdivision of said State.
Section VII.06. No Disposition of Trust Estate. Except as permitted by this
Indenture, the Authority shall not sell, lease, pledge, assign or otherwise
dispose of or encumber its interest in the Trust Estate and will promptly pay
or cause to be discharged or make adequate provision to discharge any lien or
charge on any part thereof not permitted hereby.
Section VII.07. Financing Statements.
The Authority and the Trustee shall cooperate with the Company in causing
appropriate financing statements, naming the Trustee as pledgee of the
Receipts and Revenues of the Authority from the Loan Agreement
and of the other moneys pledged under the Indenture for the payment of the
principal of and premium, if any, and interest on the Bonds, and as pledgee and
assignee of the balance of the Trust Estate, and the Authority shall cooperate
with the Trustee and the Company in causing appropriate continuation statements
to be duly filed and recorded in the appropriate state and county offices as
required by the provisions of the Uniform Commercial Code or other similar law
as adopted in the State of Arizona and any other applicable jurisdiction, as
from time to time amended, in order to perfect and maintain the security
interests created by this Indenture.
Section VII.08. Tax Covenants; Rebate Fund.
(a) The Authority covenants for the benefit of all Owners from time to
time of the Bonds that it will not directly or indirectly use or
(to the extent within its control), permit the use of, the proceeds of any of
the Bonds or any other funds of the Authority, or take or omit to take any
other action, if and to the extent that such use, or the taking or omission
to take such action, would cause any of the Bonds to be "arbitrage bonds"
within the meaning of Section 148 of the Code or otherwise subject to federal
income taxation by reason of Sections 103 and 141 through 150 of the Code or
Section 103 of the 1954 Code, as applicable, and any applicable regulations
promulgated thereunder. To that end the Authority covenants to comply with
all covenants set forth in the Tax Agreement, which is hereby incorporated
herein by reference as though fully set forth herein.
(b) The Trustee shall establish and maintain a fund separate from any other
fund established and maintained hereunder designated"The Industrial Development
Authority of the County of Apache Pollution Control Revenue Bonds,1998 Series B
(Tucson Electric Power Company Project) Rebate Fund" (herein called the "Rebate
Fund") in accordance with the provisions of the Tax Agreement. Within the
Rebate Fund, the Trustee shall maintain such accounts as shall be directed by
the Company in order for the Authority and the Company to comply with the
provisions of the Tax Agreement. Subject to the transfer provisions provided in
paragraph (c) below,all money at any time deposited in the Rebate Fund shall be
held by the Trustee in trust, to the extent required to satisfy the Rebate
Requirement (as defined in the Tax Agreement), for payment to the United States
of America, and neither the Company, the Authority or the Owners shall have any
rights in or claim to such moneys. All amounts deposited into or on deposit in
the Rebate Fund shall be governed by this Section 7.08, by Section 6.04 of the
Loan Agreement and by the Tax Agreement. The Trustee shall conclusively be
deemed to have complied with such provisions if it follows the directions of
the Company, including supplying all necessary information in the manner set
forth in the Tax Agreement, and shall not be required to take any actions
thereunder in the absence of written directions from the Company.
(c) Upon receipt of the Company's written instructions, the Trustee shall
remit part or all of the balances in the Rebate Fund to the United States of
America, as so directed. In addition, if the Company so directs, the Trustee
shall deposit moneys into or transfer moneys out of the Rebate Fund from or
into such accounts or funds as directed by the Company's written directions.Any
funds remaining in the Rebate Fund after all of the Bonds shall have been paid
and any Rebate Requirement shall have been satisfied, or provision therefor
reasonably satisfactory to the Trustee shall have been made,shall be withdrawn
and remitted to the Company.
(d) Notwithstanding any provision of this Indenture,the obligation to remit
the Rebate Requirement to the United States of America and to comply with all
other requirements of this Section 7.08,Section 6.04 of the Loan Agreement and
the Tax Agreement shall survive the payment of the Bonds and the satisfaction
and discharge of this Indenture.
Section VII.09. Notices of Trustee.
The Trustee shall give notice to both the Authority and the Company whenever
it is required hereby to give notice to either and, additionally, shall
furnish to the Authority and the Company copies of any Notice by Mail or
Publication given by it pursuant to any provision hereof.
ARTICLE VIII
DEFEASANCE
Section VIII.01. Defeasance.
If the Authority shall pay or cause to be paid to the Owner of
any Bond secured hereby the principal of and premium, if any, and interest due
and payable, and thereafter to become due and payable, upon such Bond or any
portion of such Bond in the principal amount of $5,000 or any integral multiple
thereof, such Bond or portion thereof shall cease to be entitled to any lien,
benefit or security under this Indenture. If the Authority shall pay or cause
to be paid to the Owners of all the Bonds secured hereby the principal of and
premium, if any, and interest due and payable, and thereafter to become due and
payable, thereon, and shall pay or cause to be paid all other sums payable
hereunder including, without limitation, amounts payable pursuant to Section
10.04 hereof, then, and in that case, the right, title and interest of the
Trustee in and to the Trust Estate shall thereupon cease, terminate and become
void. In such event, the Trustee shall assign, transfer and turn over to the
Company the Trust Estate, including, without limitation,any surplus in the Bond
Fund and any balance remaining in any other fund created under this Indenture.
All or any portion of Outstanding Bonds or portions of Bonds in principal
amounts of $5,000 or any integral multiple thereof, shall prior to the maturity
or redemption date thereof be deemed to have been paid within the meaning and
with the effect expressed in this Article VIII, and the entire indebtedness of
the Authority with respect thereof shall be satisfied and discharged, when
(a) in the event said Bonds or portions thereof have been selected for
redemption in accordance with Section 3.02 hereof, the Trustee shall have
given, or the Company shall have given to the Trustee in form satisfactory to
it irrevocable instructions to give, on a date in accordance with the
provisions of Section 3.03 hereof, notice of redemption of such Bonds or
portions thereof,
(b) there shall have been deposited with the Trustee either moneys in an
amount which shall be sufficient, or Government Obligations which shall not
contain provisions permitting the redemption thereof at the option of the
issuer, the principal of and the interest on which, when due, and without
regard to any reinvestment thereof, will provide moneys which, together with
the moneys, if any, deposited with or held by the Trustee,
shall be sufficient, to pay when due the principal of and premium, if any,
and interest due and to become due on said Bonds or portions thereof on and
prior to the redemption date or maturity date thereof, as the case may be,
and
(c) in the event said Bonds or portions thereof do not mature and are not to
be redeemed within the next succeeding sixty (60) days, the Company shall
have given the Trustee in form satisfactory to it irrevocable instructions to
give, as soon as practicable in the same manner as a notice of redemption is
given pursuant to Section 3.03 hereof, a notice to the Owners of said Bonds
or portions thereof that the deposit required by clause (b) above has been
made with the Trustee and that said Bonds or portions thereof are deemed to
have been paid in accordance with this Article VIII and stating the maturity
or redemption date upon which moneys are to be available for the payment of
the principal of and premium, if any, and interest on said Bonds or portions
thereof.
Neither the Government Obligations nor moneys deposited with the Trustee
pursuant to this Article VIII nor principal or interest payments on any such
Government Obligations shall be withdrawn or used for any purpose other than,
and such Government Obligations, moneys and principal or interest payments
shall be held in trust for, the payment of the principal of and premium, if
any, and interest on said Bonds or portions thereof; provided, that any cash
received from such principal or interest payments on such Government
Obligations deposited with the Trustee, if not then needed for such purposes,
shall, to the extent practicable, be invested in Government Obligations of the
type described in clause (b) of the preceding paragraph maturing at times and
in amounts sufficient to pay when due the principal of and premium, if any, and
interest to become due on said Bonds or portions thereof on and prior to such
redemption date or maturity date thereof, as the case may be, and interest
earned from such reinvestments shall be paid over to the Company, as received
by the Trustee, free and clear of any trust, lien or pledge hereunder. If
payment of less than all the Bonds is to be provided for in the manner and
with the effect provided in this Article VIII, the Trustee shall select such
Bonds or portions of Bonds in the manner specified by Section 3.02 hereof for
selection for redemption of less than all Bonds in the principal amount
designated to the Trustee by the Company. At or prior to the time of the
deposit of any Government Obligations with the Trustee pursuant to this
Section 8.01, the Company shall provide the Trustee with a certificate of an
accountant or an accounting firm as to the sufficiency of such Government
Obligations to pay when due the principal of and premium, if any, and interest
due and to become due as set forth in clause (b) of the preceding paragraph.
ARTICLE IX
DEFAULTS AND REMEDIES
Section IX.01. Events of Default.
Each of the following events shall constitute and is referred to in this
Indenture as an "Event of Default":
(a)a failure to pay the principal of or premium, if any, on any of the Bonds
when the same shall become due and payable at maturity, upon redemption or
otherwise;
(b) a failure to pay an installment of interest on any of the Bonds after
such interest shall have become due and payable for a period of thirty (30)
days;
(c) a failure by the Authority to observe and perform any covenant,
condition, agreement or provision (other than as specified in clauses (a) and
(b) of this Section 9.01) contained in the Bonds or in this Indenture on the
part of the Authority to be observed or performed, which failure shall
continue for a period of sixty (60) days after written notice, specifying
such failure and requesting that it be remedied, shall have been given to the
Authority and the Company by the Trustee, which may give such notice in its
discretion and which shall give such notice at the written request of Owners
of not less than 33% in principal amount of the Bonds then Outstanding,
unless the Trustee, or the Trustee and Owners of a principal amount of Bonds
not less than the principal amount of Bonds the Owners of which requested
that such notice be given, as the case may be, shall agree in writing to an
extension of such period prior to its expiration; provided, however, that the
Trustee, or the Trustee and the Owners of such principal amount of Bonds, as
the case may be, shall be deemed to have agreed to an extension of such
period if corrective action is initiated by the Authority, or the
Company on behalf of the Authority, within such period and is being
diligently pursued.
Upon the occurrence and continuance of any Event of Default described in
clause (a) or (b) of the preceding paragraph, the Trustee may, and at the
written request of Owners of not less than 33%in principal amount of Bonds then
Outstanding shall, by written notice to the Authority and the Company, declare
the Bonds to be immediately due and payable, whereupon they shall, without
further action, become and be immediately due and payable, anything in this
Indenture or in the Bonds to the contrary notwithstanding,and the Trustee shall
give notice thereof by Mail to all Owners of Outstanding Bonds.
The provisions of the preceding paragraph, however, are subject to the
condition that if, after the principal of the Bonds shall have been so declared
to be due and payable, and before any judgment or decree for the payment of the
moneys due shall have been obtained or entered as hereinafter provided, the
Authority shall cause to be deposited with the Trustee a sum sufficient to pay
all matured installments of interest upon all Bonds and the principal of
any and all Bonds which shall have become due otherwise than by reason of such
declaration (with interest upon such principal and, to the extent permissible
by law, on overdue installments of interest, at the rate per annum borne by the
Bonds) and such amounts as shall be sufficient to cover reasonable compensation
and reimbursement of expenses payable to the Trustee and any predecessor
Trustee, and all Events of Default hereunder other than nonpayment of the
principal of Bonds which shall have become due by said declaration shall have
been remedied, then, in every such case, such Event of Default shall be deemed
waived and such declaration and its consequences rescinded and annulled, and
the Trustee shall promptly give written notice of such waiver, rescission and
annulment to the Authority and the Company, and,if notice of the acceleration
of the Bonds shall have been given to the Owners of the Bonds,shall give notice
thereof by Mail to all Owners of Outstanding Bonds; but no such waiver,
rescission and annulment shall extend to or affect any subsequent Event of
Default or impair any right or remedy consequent thereon.
Section IX.02. Remedies.
Upon the occurrence and continuance of any Event of Default, then and in every
such case the Trustee in its discretion may, and upon the written request of
Owners of not less than a majority in principal amount of the Bonds then
Outstanding and receipt of indemnity to its satisfaction shall, in its own
name and as the Trustee of an express trust:
(a) by mandamus, or other suit, action or proceeding at law or in equity,
enforce all rights of the Owners of the Bonds, and require the Authority or
the Company to carry out any agreements with or for the benefit of such
Owners and to perform its or their duties under the Act, the Loan Agreement
and this Indenture;
(b) bring suit upon the Bonds; or
(c) by action or suit in equity enjoin any acts or things which may be
unlawful or in violation of the rights of the Owners of the Bonds.
Section IX.03. Restoration to Former Position. In the event that any
proceeding taken by the Trustee to enforce any right under this Indenture
shall have been discontinued or abandoned for any reason, or shall have been
determined adversely to the Trustee, then the Authority, the Trustee and the
Owners shall be restored, subject to any determination in such proceeding,
to their former positions and rights hereunder, respectively, and all rights,
remedies and powers of the Trustee shall continue as though no such proceeding
had been taken.
Section IX.04. Owners' Right to Direct Proceedings. Anything in this
Indenture to the contrary notwithstanding, the Owners of a majority in
principal amount of the Bonds then Outstanding hereunder shall have the right,
by an instrument in writing executed and delivered to the Trustee,to direct
the time, method and place of conducting all remedial proceedings available to
the Trustee under this Indenture or exercising any trust or power conferred on
the Trustee by this Indenture; provided, however, that such direction shall not
be otherwise than in accordance with law and the provisions of this Indenture
and that the Trustee shall have the right (but not the obligation) to decline
to follow any such direction if the Trustee, being advised by counsel, shall
determine that the action or proceeding so directed may not lawfully be taken,
or if the Trustee in good faith shall determine that the action or proceedings
so directed would involve the Trustee in personal liability or if the Trustee
in good faith shall so determine that the actions or forbearances specified
in or pursuant to such direction would be unduly prejudicial to the interests
of Owners not joining in the giving of said direction, it being understood that
the Trustee shall have no duty to ascertain whether or not such actions or
forbearances are unduly prejudicial to such Owners.
Section IX.05. Limitation on Owners' Right to Institute Proceedings.
No Owner of Bonds shall have any right to institute any suit,
action or proceeding in equity or at law for the execution of any trust or
power hereunder,or any other remedy hereunder or on said Bonds,unless such
Owner previously shall have given to the Trustee written notice of an Event of
Default as hereinabove provided and unless the Owners of not less than a
majority in principal amount of the Bonds then Outstanding shall have made
written request of the Trustee so to do, after the right to institute said
suit, action or proceeding shall have accrued, and shall have afforded the
Trustee a reasonable opportunity to proceed to institute the same in either
its or their name, and unless there also shall have been offered to the Trustee
security and indemnity satisfactory to it against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee shall not have
complied with such request within a reasonable time; and such notification,
request and offer of indemnity are hereby declared in every such case, at the
option of the Trustee, to be conditions precedent to the institution of said
suit, action or proceeding; it being understood and intended that no one or
more of the Owners of the Bonds shall have any right in any manner whatever
by his or their action to affect, disturb or prejudice the security of this
Indenture, or to enforce any right hereunder or under the Bonds,except
in the manner herein provided, and that all suits, actions and proceedings
at law or in equity shall be instituted, had and maintained in the manner
herein provided and for the equal benefit of all Owners of the Bonds.
Section IX.06. No Impairment of Right to Enforce Payment. Notwithstanding
any other provision in this Indenture, the right of any Owner of a Bond to
receive payment of the principal of and premium, if any, and interest on such
Bond, on or after the respective due dates expressed therein, or to institute
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of such Owner.
Section IX.07. Proceedings by Trustee without Possession of
Bonds. All rights of action under this Indenture or under any of the Bonds
secured hereby which are enforceable by the Trustee may be enforced by it
without the possession of any of the Bonds, or the production thereof on the
trial or other proceedings relative thereto, and any such suit, action or
proceeding instituted by the Trustee shall be brought in its name for the equal
and ratable benefit of the Owners of the Bonds, subject to the provisions of
this Indenture.
Section IX.08. No Remedy Exclusive.
No remedy herein conferred upon or reserved to the Trustee or to the Owners
of the Bonds is intended to be exclusive of any other remedy or remedies, and
each and every such remedy shall be cumulative, and shall be in addition to
every other remedy given hereunder or under the Loan Agreement, now or
hereafter existing at law or in equity or by statute.
Section IX.09. No Waiver of Remedies.
No delay or omission of the Trustee or of any Owner of a Bond to exercise any
right or power accruing upon any default shall impair any such right or power
or shall be construed to be a waiver of any such default, or an acquiescence
therein; and every power and remedy given by this Article IX to the Trustee
and to the Owners of the Bonds, respectively, may be exercised from time to
time and as often as may be deemed expedient.
Section IX.10. Application of Moneys. Any moneys received by the Trustee,
by any receiver or by any Owner of a Bond pursuant to any right given or
action taken under the provisions of this Article IX, after payment of the
costs and expenses of the proceedings resulting in the collection of such
moneys and of all amounts due to the Trustee and any predecessor Trustee under
Section 10.04 hereof, shall be deposited in the Bond Fund and all moneys so
deposited in the Bond Fund during the continuance of an Event of Default
(other than moneys for the payment of Bonds which had matured or otherwise
become payable prior to such Event of Default or for the payment of interest
due prior to such Event of Default) shall be applied as follows:
(a) Unless the principal of all the Bonds shall have become due and payable,
all such moneys shall be applied (i) first, to the payment to the persons
entitled thereto of all installments of interest then due on the Bonds, with
interest on overdue installments, if lawful, at the rate per annum borne by
the Bonds, in the order of maturity of the installments of such interest and,
if the amount available shall not be sufficient to pay in full any particular
installment of interest, then to the payment ratably, according to the
amounts due on such installment, and (ii) second, to the payment to the
persons entitled thereto of the unpaid principal of any of the Bonds which
shall have become due (other than Bonds called for redemption for the payment
of which money is held pursuant to the provisions of this Indenture), with
interest on such Bonds at their rate from the respective dates upon which
they became due and, if the amount available shall not be sufficient to pay
in full Bonds due on any particular date, together with such interest, then
to the payment ratably, according to the amount of principal and interest
due on such date, in each case to the persons entitled thereto, without any
discrimination or privilege.
(b) If the principal of all the Bonds shall have become due and payable, all
such moneys shall be applied to the payment of the principal and interest
then due and unpaid upon the Bonds, with interest on overdue interest and
principal, as aforesaid, without preference or priority of principal over
interest or of interest over principal, or of any installment of interest
over any other installment of interest, or of any Bond over any other Bond,
ratably, according to the amounts due respectively for principal and
interest, to the persons entitled thereto without any discrimination or
privilege.
(c) If the principal of all the Bonds shall have become due and payable, and
if acceleration of the maturity of the Bonds by reason of such Event of
Default shall thereafter have been rescinded and annulled under the
provisions of this Article IX, then, subject to the provisions of clause (b)
of this Section 9.10 which shall be applicable in the event that the
principal of all the Bonds shall later become due and payable, the moneys
shall be applied in accordance with the provisions of clause (a) of this
Section 9.10.
Section IX.11. Severability of Remedies.
It is the purpose and intention of this Article IX to provide rights and
remedies to the Trustee and the Owners which may be lawfully granted
under the provisions of the Act,but should any right or remedy herein
granted be held to be unlawful, the Trustee and the Owners shall be
entitled, as above set forth, to every other right and remedy provided in this
Indenture and by law.
ARTICLE X
TRUSTEE; PAYING AGENT AND CO-PAYING AGENTS; REGISTRAR
Section X.01. Acceptance of Trusts. The Trustee hereby accepts and agrees
to execute the trusts hereby created, but only upon the additional terms set
forth in this Article X, to all of which the Authority agrees and the
respective Owners agree by their acceptance of delivery of any of the Bonds.
Section X.02. No Responsibility for Recitals. The recitals, statements and
representations contained in this Indenture or in the Bonds, save only the
Trustee's authentication upon the Bonds, are not made by the Trustee, and the
Trustee does not assume, and shall not have, any responsibility or obligation
for the correctness of any thereof. The Trustee makes no representation as to
the validity or sufficiency of this Indenture or the Bonds.
Section X.03. Limitations on Liability.
The Trustee may execute any of the trusts or powers hereof and perform the
duties required of it hereunder by or through attorneys, agents, receivers,
or employees, and shall be entitled to advice of counsel concerning all
matters of trust and its duty hereunder, and the Trustee shall not be
answerable for the default or misconduct of any such attorney,
agent, receiver, or employee selected by it with reasonable care. The Trustee
shall not be answerable for the exercise of any discretion or power under this
Indenture or for anything whatsoever in connection with the trust created
hereby, except only for its own negligence or bad faith.
Anything in this Indenture to the contrary notwithstanding, the Trustee shall
in no event be required to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if there shall be reasonable grounds
for believing that the repayment of such funds or adequate indemnity against
such liability is not reasonably assured to it.
Section X.04. Compensation, Expenses and Advances. The Trustee, the Paying
Agent and any Co-Paying Agent, and the Registrar under this Indenture shall be
entitled to reasonable compensation for their services rendered hereunder (not
limited by any provision of law regarding the compensation of the trustee of an
express trust) and to reimbursement for their actual out-of-pocket expenses
(including counsel fees)reasonably incurred in connection therewith except as a
result of their negligence or bad faith, including, without limitation,
compensation for any services rendered, and reimbursement for any expenses
incurred, at and subsequent to the time the Bonds are deemed to have been paid
in accordance with Article VIII hereof. If the Authority shall fail to perform
any of the covenants or agreements contained in this Indenture, other than the
covenants or agreements in respect of the payment of the principal of and
premium, if any, and interest on the Bonds,the Trustee may, in its uncontrolled
discretion and without notice to the Owners of the Bonds, at any time and from
time to time, make advances to effect performance of the same on behalf of the
Authority, but the Trustee shall be under no obligation
so to do; and any and all such advances may bear interest at a rate
per annum not exceeding the base rate then in effect for 90-day commercial
loans by the Trustee or a commercial banking affiliate of the Trustee
designated as such by the Trustee in the city in which is located the Principal
Office of the Trustee (or such affiliate, as the case may be) to borrowers of
the highest credit standing; but no such advance shall operate to relieve the
Authority from any default hereunder. In Section 5.03 of the Loan Agreement,
the Company has agreed that it will pay to the Trustee (including any
predecessor Trustee), the Paying Agent and any Co-Paying Agent and the
Registrar, such compensation and reimbursement of expenses and advances,but the
Company may, without creating a default hereunder, contest in good faith the
reasonableness of any such services, expenses and advances. If the Company
shall have failed to make any payment to the Trustee or any predecessor Trustee
under Section 5.03of the Loan Agreement and such failure shall have resulted in
an Event of Default under the Loan Agreement, the Trustee, and any predecessor
Trustee, shall have, in addition to any other rights hereunder, a claim, prior
to the claim of the Owners, for the payment of its compensation and the
reimbursement of its expenses and any advances made by it, as provided in
this Section 10.04, upon the moneys and obligations in the Bond Fund;provided,
however, that neither the Trustee nor any predecessor Trustee shall have any
such claim upon moneys or obligations deposited with or paid to the Trustee for
the redemption or payment of Bonds which are deemed to have been paid in
accordance with Article VIII hereof.
In Section 5.04 of the Loan Agreement, the Company has agreed to indemnify
the Trustee and any predecessor Trustee to the extent provided therein.
Section X.05. Notice of Events of Default.
The Trustee shall not be required to take notice, or be deemed to have
notice, of any default or Event of Default under this Indenture other than an
Event of Default under clause (a) or (b) of the first paragraph of Section 9.01
hereof, unless an officer assigned by the Trustee to administer its corporate
trust business has been specifically notified in writing of such default or
Event of Default by Owners of at least 33% in principal amount of the Bonds
then Outstanding. The Trustee may, however, at any time, in its discretion,
require of the Authority and the Company full information and advice as
to the performance of any of the covenants,conditions and agreements contained
herein.
Section X.06. Action by Trustee.
The Trustee shall be under no obligation to take any action in
respect of any default or Event of Default hereunder or toward the execution or
enforcement of any of the trusts hereby created, or to institute, appear in or
defend any suit or other proceeding in connection therewith,unless requested in
writing so to do by Owners of at least a majority in principal amount of the
Bonds then Outstanding, and, if in its opinion such action may tend to involve
it in expense or liability, unless furnished, from time to time as often as it
may require, with security and indemnity satisfactory to it. The foregoing
provisions are intended only for the protection of the Trustee, and shall not
affect any discretion or power given by any provisions of this Indenture to the
Trustee to take action in respect of any default or Event of Default without
such notice or request from the Owners of the Bonds,or without such security or
indemnity.
Section X.07. Good Faith Reliance. The Trustee shall
be protected and shall incur no liability in acting or proceeding in good faith
upon any resolution, notice, telegram, telex, facsimile transmission, request,
consent, waiver, certificate, statement, affidavit, voucher, bond, requisition
or other paper or document which it shall in good faith believe to be genuine
and to have been passed or signed by the proper board,body or person or to have
been prepared and furnished pursuant to any of the provisions of this Indenture
or the Loan Agreement, or upon the written opinion of any attorney, engineer,
accountant or other expert believed by the Trustee to be qualified in relation
to the subject matter, and the Trustee shall be under no duty to make any
investigation or inquiry as to any statements contained or matters referred to
in any such instrument, but may accept and rely upon the same as conclusive
evidence of the truth and accuracy of such statements. Neither the Trustee,the
Paying Agent, any Co-Paying Agent nor the Registrar shall be bound to recognize
any person as an Owner of a Bond or to take any action at his request unless
the ownership of such Bond is proved as contemplated in Section 11.01 hereof.
Section X.08. Dealings in Bonds and with the Authority and theCompany.
The Trustee, the Paying Agent, any Co-Paying Agent or the Registrar, in its
individual or any other capacity, may in good faith buy, sell, own, hold and
deal in any of the Bonds issued hereunder,and may join in any action which any
Owner of a Bond may be entitled to take with like effect as if it did not act
in any capacity hereunder. The Trustee, the Paying Agent,any Co-Paying Agent
or the Registrar, in its individual or any other capacity,either as principal
or agent, may also engage in or be interested in any financial or other
transaction with the Authority or the Company, and may act as depositary,
trustee, or agent for any committee or body of Owners of Bonds secured hereby
or other obligations of the Authority as freely as if it did not act in any
capacity hereunder.
Section X.09. Allowance of Interest. The Trustee may, but shall not be
obligated to, allow and credit interest upon any moneys which it may at any
time receive under any of the provisions of this Indenture, at such rate, if
any, as it customarily allows upon similar funds of similar size and under
similar conditions. All interest allowed on any such moneys shall be credited
as provided in Article IV with respect to interest on investments.
Section X.10. Construction of Indenture.
The Trustee may construe any of the provisions of this Indenture insofar
as the same may appear to be ambiguous or inconsistent with any other
provision hereof, and any construction of any such provisions hereof
by the Trustee in good faith shall be binding upon the Owners of the Bonds.
Section X.11. Resignation of Trustee. The Trustee may resign and be
discharged of the trusts created by this Indenture by executing an instrument
in writing resigning such trust and specifying the date when such resignation
shall take effect, and filing the same with the President of the Authority and
with the Company, not less than forty-five (45) days before the date specified
in such instrument when such resignation shall take effect,and by giving notice
of such resignation by Mail to all Owners of Bonds. Such resignation shall take
effect on the later to occur of (i) the day specified in such instrument and
notice, unless previously a successor Trustee shall have been appointed as
hereinafter provided, in which event such resignation shall take effect
immediately upon the appointment of such successor Trustee and (ii)
the appointment of a successor Trustee.
So long as no event which is, or after notice or lapse of time, or both,
would become, an Event of Default shall have occurred and be continuing, if the
Authority shall have delivered to the Trustee (i) an instrument appointing a
successor Trustee, effective as of a date specified therein and (ii) an
instrument of acceptance of such appointment, effective as of such date,by such
successor Trustee in accordance with Section 10.16, the Trustee shall be deemed
to have resigned as contemplated in this Section,the successor Trustee shall be
deemed to have been appointed pursuant to subsection (b) of Section 10.13 and
such appointment shall be deemed to have been accepted as contemplated in
Section 10.16, all as of such date, and all other provisions of this Article X
shall be applicable to such resignation, appointment and acceptance except to
the extent inconsistent with this paragraph. The Authority shall deliver any
such instrument of appointment at the direction of the Company.
Section X.12. Removal of Trustee.
The Trustee may be removed at any time by filing with the Trustee
so removed, and with the Authority and the Company, an instrument or
instruments in writing, appointing a successor, or an instrument or instruments
in writing, consenting to the appointment by the Authority (at the direction of
the Company) of a successor and accompanied by an instrument of appointment by
the Authority (at the direction of the Company) of such successor, and in any
event executed by Owners of not less than a majority in principal amount of the
Bonds then Outstanding, such filing to be made by any Owner of a Bond or his
duly authorized attorney.
Section X.13. Appointment of Successor Trustee.
(a) In case at any time the Trustee shall be removed, or be dissolved,
or if its property or affairs shall be taken under the control of any state
or federal court or administrative body because of insolvency
or bankruptcy, or for any other reason, then a vacancy shall forthwith
and ipso facto exist and a successor may be appointed, and in case at any
time the Trustee shall resign or be deemed to have resigned, then a successor
may be appointed, by filing with the Authority and the Company an instrument in
writing appointing such successor Trustee executed by Owners of not less than a
majority in principal amount of Bonds then Outstanding. Copies of such
instrument shall be promptly delivered by the Authority to the predecessor
Trustee, to the Trustee so appointed and the Company.
(b) Until a successor Trustee shall be appointed by the Owners of the Bonds
as herein authorized, the Authority, shall appoint a successor Trustee as
directed by the Company. After any appointment by the Authority,it shall cause
notice of such appointment to be given by Mail to all Owners of Bonds. Any new
Trustee so appointed by the Authority shall immediately and without further act
be superseded by a Trustee appointed by the Owners of the Bonds in the manner
above provided.
(c) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee.
Section X.14. Qualifications of Successor Trustee.
Every successor Trustee (a) shall be a bank or trust company duly
organized under the laws of the United States or any state or territory
thereof authorized by law to perform all the duties imposed upon it by this
Indenture and (b) shall have (or the parent holding company of which shall
have) a combined capital stock, surplus and undivided profits of at least
$100,000,000 if there can be located, with reasonable effort, such an
institution willing and able to accept the trust on reasonable and customary
terms.
Section X.15. Judicial Appointment of Successor Trustee. In case at any time
the Trustee shall resign and no appointment of a successor Trustee shall be
made pursuant to the foregoing provisions of this Article X prior to the date
specified in the notice of resignation as the date when such resignation is to
take effect, the retiring Trustee may forthwith apply to a court of competent
jurisdiction for the appointment of a successor Trustee. If no appointment of a
successor Trustee shall be made pursuant to the foregoing provisions of this
Article X within six months after a vacancy shall have occurred in the office
of Trustee,any Owner of a Bond may apply to any court of competent jurisdiction
to appoint a successor Trustee. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, appoint a successor Trustee.
Section X.16. Acceptance of Trusts by Successor Trustee. Any successor
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Authority an instrument accepting such appointment hereunder,and thereupon such
successor Trustee, without any further act, deed or conveyance, shall become
duly vested with all the estates, property, rights, powers, trusts, duties and
obligations of its predecessor in the trust hereunder, with like effect as if
originally named Trustee herein. Upon request of such Trustee,such predecessor
Trustee and the Authority shall execute and deliver an instrument transferring
to such successor Trustee all the estates, property, rights, powers and trusts
hereunder of such predecessor Trustee and, subject to the provisions of Section
10.04 hereof, such predecessor Trustee shall pay over to the successor Trustee
all moneys and other assets at the time held by it hereunder.
Section X.17. Successor by Merger or Consolidation. Any corporation or
association into which any Trustee hereunder may be merged or converted or with
which it may be consolidated, or any corporation or association resulting from
any merger or consolidation to which any Trustee hereunder shall be a party or
any corporation or association succeeding to the corporate trust business of
the Trustee, shall be the successor Trustee under this Indenture, without the
execution or filing of any paper or any further act on the part of the parties
hereto, anything in this Indenture to the contrary notwithstanding.
If, at the time any such successor to the Trustee shall succeed to the trusts
created by this Indenture, any of the Bonds shall have been authenticated but
not delivered, such successor Trustee may adopt the certificate of
authentication of any predecessor Trustee and deliver such Bonds so
authenticated; and if at that time, any of the Bonds shall not have been
authenticated, such successor Trustee may authenticate such Bonds either in the
name of any such predecessor hereunder or in the name of such successor; and,in
all such cases, such certificate of authentication shall have the full force
which it is anywhere in the Bonds or in this Indenture provided that the
certificate of authentication of the Trustee shall have; provided, however,
that the right to adopt the certificate of authentication of any predecessor
Trustee or to authenticate Bonds in the name of any predecessor Trustee shall
apply only to its successor or successors by merger, conversion or
consolidation.
Section X.18. Standard of Care.
Notwithstanding any other provisions of this Article X, the Trustee
shall, during the existence of an Event of Default of which the Trustee has
actual notice, exercise such of the rights and powers vested in it by this
Indenture and use the same degree of skill and care in their exercise as a
prudent man would use and exercise under the circumstances in the conduct of
his own affairs.
Section X.19. Notice to Owners of Bonds of Event of Default. If an
Event of Default occurs of which the Trustee by Section10.05 hereof is required
to take notice and deemed to have notice, or any other Event of Default occurs
of which the Trustee has been specifically notified in accordance with Section
10.05 hereof, and any such Event of Default shall continue for at least two
days after the Trustee acquires actual notice thereof, unless the Trustee shall
have theretofore given a notice of acceleration pursuant to Section 9.01
hereof, the Trustee shall give Notice by Mail to all Owners of Outstanding
Bonds.
Section X.20. Intervention in Litigation of the Authority. In any
judicial proceeding to which the Authority is a party and which in the opinion
of the Trustee and its counsel has a substantial bearing on the interests of
the Owners of Bonds, the Trustee may intervene on behalf of the Owners of the
Bonds and shall, upon receipt of indemnity satisfactory to it, do so if
requested in writing by Owners of at least a majority in principal amount
of the Bonds then Outstanding if permitted by the court having jurisdiction
in the premises.
Section X.21. Paying Agent; Co-Paying Agents. The Authority shall, with the
approval of the Company, appoint the Paying Agent for the Bonds and may at any
time or from time to time,with the approval of the Company, appoint one or more
Co-Paying Agents for the Bonds, subject to the conditions set forth in Section
10.22 hereof. The Paying Agent and each Co-Paying Agent shall designate to the
Trustee its Principal Office and signify its acceptance of the duties and
obligations imposed upon it hereunder by a written instrument of acceptance
delivered to the Authority and the Trustee in which such Paying Agent or Co-
Paying Agent will agree, particularly:
(a) to hold all sums held by it for the payment of the principal of and
premium, if any, or interest on Bonds in trust for the benefit of the Owners
of the Bonds until such sums shall be paid to such Owners or otherwise
disposed of as herein provided;
(b) to keep such books and records as shall be consistent with prudent
industry practice, to make such books and records available for inspection by
the Authority, the Trustee and the Company at all reasonable times and, in
the case of a Co-Paying Agent, to promptly furnish copies of such books and
records to the Paying Agent; and
(c) in the case of a Co-Paying Agent,upon the request of the Paying Agent,
to forthwith deliver to the Paying Agent all sums so held in trust by such
Co-Paying Agent.
The Authority shall cooperate with the Trustee and the Company to cause the
necessary arrangements to be made and to be thereafter continued whereby funds
derived from the sources specified in Sections 4.03and 4.04 hereof will be made
available to the Paying Agent and each Co-Paying Agent for the payment when due
of the principal of, premium, if any, and interest on the Bonds.
Section X.22. Qualifications of Paying Agent and Co-Paying Agents;
Resignation; Removal. The Paying Agent and any Co-Paying Agent shall be a
corporation or association duly organized under the laws of the United States
of America or any state or territory thereof, having a combined capital stock,
surplus and undivided profits of at least $15,000,000 and authorized by law to
perform all the duties imposed upon it by this Indenture.
The Paying Agent and any Co-Paying Agent may at any time resign
and be discharged of the duties and obligations created by this Indenture by
giving at least sixty (60) days' notice to the Authority, the Company and the
Trustee. The Paying Agent and any Co-Paying Agent may be removed at any time,
at the direction of the Company, by an instrument, signed by the Authority,
filed with the Paying Agent or such Co-Paying Agent, as the case may be, and
with the Trustee.
In the event of the resignation or removal of the Paying Agent or any
Co-Paying Agent, the Paying Agent or such Co-Paying Agent, as the case may be,
shall pay over,assign and deliver any moneys held by it in such capacity to its
successor or, if there be no successor, to the Trustee.
In the event that the Authority shall fail to appoint a Paying Agent
hereunder, or in the event that the Paying Agent shall resign or be removed, or
be dissolved, or if the property or affairs of the Paying Agent shall be taken
under the control of any state or federal court or administrative body because
of bankruptcy or insolvency, or for any other reason, and the Authority shall
not have appointed its successor as Paying Agent, the Trustee shall ipso facto
be deemed to be the Paying Agent for all purposes of this Indenture until the
appointment by the Authority of the Paying Agent or successor Paying Agent,
as the case may be.
Upon the appointment of a successor Paying Agent, the Trustee shall give
notice thereof by Mail to all Owners of Bonds.
Section X.23. Registrar. The Authority shall,with the approval of the
Company, appoint the Registrar for the Bonds, subject to the conditions set
forth in Section 10.24 hereof. The Registrar shall designate to the Trustee
its Principal Office and signify its acceptance of the duties imposed upon it
hereunder by a written instrument of acceptance delivered to the Authority and
the Trustee in which such Registrar will agree, particularly, to keep such
books and records as shall be consistent with prudent industry practice and to
make such books and records available for inspection by the Authority, the
Trustee and the Company at all reasonable times.
The Authority shall cooperate with the Trustee and the Company to cause the
necessary arrangements to be made and to be thereafter continued whereby Bonds,
executed by the Authority and authenticated by the Trustee, shall be made
available for exchange, registration and registration of transfer at the
Principal Office of the Registrar. The Authority shall cooperate with the
Trustee,the Registrar and the Company to cause the necessary arrangements to be
made and thereafter continued whereby the Paying Agent and any Co-Paying Agent
shall be furnished such records and other information, at such times, as shall
be required to enable the Paying Agent and such Co-Paying Agent to perform the
duties and obligations imposed upon them hereunder.
Section X.24. Qualifications of Registrar; Resignation; Removal.
The Registrar shall be a corporation or association duly organized
under the laws of the United States of America or any state or territory
thereof, having a combined capital stock, surplus and undivided profits of at
least $15,000,000 and authorized by law to perform all the duties imposed upon
it by this Indenture. The Registrar may at any time resign and be discharged
of the duties and obligations created by this Indenture by giving at least
sixty (60) days' notice to the Authority, the Trustee and the Company.
The Registrar may be removed at any time, at the direction of the Company, by
an instrument signed by the Authority filed with the Registrar and the Trustee.
In the event of the resignation or removal of the Registrar, the Registrar
shall deliver any Bonds held by it in such capacity to its successor or, if
there be no successor, to the Trustee.
In the event that the Authority shall fail to appoint a Registrar hereunder,
or in the event that the Registrar shall resign or be removed, or be dissolved,
or if the property or affairs of the Registrar shall be taken under the control
of any state or federal court or administrative body because of bankruptcy or
insolvency, or for any other reason, and the Authority shall not have appointed
its successor as Registrar, the Trustee shall ipso facto be deemed to be the
Registrar for all purposes of this Indenture until the appointment by the
Authority of the Registrar or successor Registrar, as the case may be.
Upon the appointment of a successor Registrar, the Trustee shall give notice
thereof by Mail to all Owners of Bonds.
Section X.25. Several Capacities. Anything herein to the contrary
notwithstanding, the same entity may serve hereunder as the Trustee, the
Paying Agent or a Co-Paying Agent and the Registrar and in any combination
of such capacities to the extent permitted by law.
ARTICLE XI
EXECUTION OF INSTRUMENTS BY OWNERS OF BONDS AND
PROOF OF OWNERSHIP OF BONDS
Section XI.01. Execution of Instruments; Proof of Ownership. Any
request, direction, consent or other instrument in writing, whether or not
required or permitted by this Indenture to be signed or executed by Owners
of the Bonds, may be in any number of concurrent instruments of similar tenor
and may be signed or executed by Owners of the Bonds or by an agent appointed
by an instrument in writing. Proof of the execution of any such instrument
and of the ownership of Bonds shall be sufficient for any purpose of this
Indenture and shall be conclusive in favor of the Trustee with regard to any
action taken by it under such instrument if made in the following manner:
(a) The fact and date of the execution by any person of any such instrument
may be proved by the certificate of any officer in any jurisdiction who, by
the laws thereof, has power to take acknowledgments within such jurisdiction,
to the effect that the person signing such instrument acknowledged before him
the execution thereof, or by an affidavit of a witness to such execution.
(b) The ownership or former ownership of Bonds shall be proved by the
registration books kept under the provisions of Section 2.08 hereof.
Nothing contained in this Article XI shall be construed as limiting the
Trustee to such proof, it being intended that the Trustee may accept any other
evidence of matters herein stated which it may deem sufficient. Any request
or consent of any Owner of a Bond shall bind every future Owner of the same
Bond or any Bond or Bonds issued in lieu thereof in respect of anything done
by the Trustee or the Authority in pursuance of such request or consent.
ARTICLE XII
MODIFICATION OF THIS INDENTURE AND THE LOAN AGREEMENT
Section XII.01. Limitations. Neither this Indenture nor the Loan
Agreement shall be modified or amended in any respect subsequent to the
original issuance of the Bonds except as provided in and in accordance with
and subject to the provisions of this Article XII and Section 7.04 hereof.
The Trustee may, but shall not be obligated to, enter into any Supplemental
Indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Section XII.02. Supplemental Indentures without Owner Consent. The
Authority and the Trustee may, from time to time and at any time, without the
consent of or notice to the Owners of the Bonds, enter into Supplemental
Indentures as follows:
(a) to cure any formal defect, omission, inconsistency or ambiguity in this
Indenture, provided, however, that such cure shall not materially and
adversely affect the interests of the Owners of the Bonds;
(b) to grant to or confer or impose upon the Trustee for the benefit of the
Owners of the Bonds any additional rights, remedies, powers, authority,
security, liabilities or duties which may lawfully be granted, conferred or
imposed;
(c) to add to the covenants and agreements of, and limitations and
restrictions upon, the Authority in this Indenture other covenants,
agreements, limitations and restrictions to be observed by the Authority;
(d) to confirm, as further assurance,any pledge under, and the subjection to
any claim, lien or pledge created or to be created by, this Indenture, of the
Receipts and Revenues of the Authority from the Loan Agreement or of any
other moneys, securities or funds;
(e) to authorize a different denomination or denominations of the Bonds and
to make correlative amendments and modifications to this Indenture regarding
exchange ability of Bonds of different denominations, redemptions of portions
of Bonds of particular denominations and similar amendments and modifications
of a technical nature;
(f) to modify, alter, supplement or amend this Indenture in such manner as
shall permit the qualification hereof under the Trust Indenture Act of 1939,
as from time to time amended;
(g) to modify, alter, supplement or amend this Indenture in such manner as
shall be necessary, desirable or appropriate in order to provide for or
eliminate the registration and registration of transfer of the Bonds through
a book-entry or similar method, whether or not the Bonds are evidenced by
certificates;
(h) to modify, alter,amend or supplement this Indenture in any other respect
which is not materially adverse to the Owners and which does not involve a
change described in clause (i), (ii), (iii) or (iv) of Section 12.03(a)
hereof; and
(i) to provide any additional procedures, covenants or agreements necessary
or desirable to maintain the tax-exempt status of interest on the Bonds.
Before the Authority and the Trustee shall enter into any Supplemental
Indenture pursuant to this Section 12.02,there shall have been delivered to the
Trustee an opinion of Bond Counsel stating that such Supplemental Indenture is
authorized or permitted by this Indenture and the Act, complies with their
respective terms, will, upon the execution and delivery thereof, be valid and
binding upon the Authority in accordance with its terms and will not, in and of
itself, adversely affect the exclusion from gross income for federal tax
purposes of the interest on the Bonds.
Section XII.03. Supplemental Indentures with Consent of Owners. (a)
Except for any Supplemental Indenture entered into pursuant to Section 12.02
hereof, subject to the terms and provisions contained in this Section 12.03 and
Section 12.05 and not otherwise,Owners of not less than a majority in aggregate
principal amount of the Bonds then Outstanding which would be adversely
affected thereby shall have the right from time to time to consent to and
approve the execution and delivery by the Authority and the Trustee of any
Supplemental Indenture deemed necessary or desirable by the Authority for the
purposes of modifying, altering, amending, supplementing or rescinding, in any
particular, any of the terms or provisions contained in this Indenture;
provided, however, that, unless approved in writing by the Owners of all the
Bonds then Outstanding which would be adversely affected thereby, nothing
herein contained shall permit, or be construed as permitting, (i) a change in
the times, amounts or currency of payment of the principal of or premium,
if any, or interest on any Outstanding Bond, a reduction in the principal
amount or redemption price of any Outstanding Bond or a change in the rate of
interest thereon, or any impairment of the right of any Owner
to institute suit for the payment of any Bond owned by it, or
(ii) the creation of a claim or lien upon, or a pledge of, the Receipts and
Revenues of the Authority from the Loan Agreement ranking prior to or on a
parity with the claim, lien or pledge created by this Indenture (except as
referred to in Section 10.04 hereof), or (iii) a preference or priority of any
Bond or Bonds over any other Bond or Bonds, or (iv)a reduction in the aggregate
principal amount of Bonds the consent of the Owners of which is required for
any such Supplemental Indenture or which is required, under Section 12.07
hereof, for any modification, alteration, amendment or supplement to the Loan
Agreement.
(b) If at any time the Authority shall request the Trustee to enter into any
Supplemental Indenture for any of the purposes of this Section 12.03, the
Trustee shall cause notice of the proposed Supplemental Indenture to be given
by Mail to all Owners of Outstanding Bonds.Such notice shall briefly set forth
the nature of the proposed Supplemental Indenture and shall state that a copy
thereof is on file at the Principal Office of the Trustee for inspection by all
Owners of Bonds.
(c) Within two years after the date of the first mailing of such notice, the
Authority and the Trustee may enter into such Supplemental Indenture in
substantially the form described in such notice only if there shall have first
been delivered to the Trustee (i) the required consents, in writing, of Owners
of Bonds and (ii) an opinion of Bond Counsel stating that such Supplemental
Indenture is authorized or permitted by this Indenture and the Act, complies
with their respective terms and, upon the execution and delivery thereof, will
be valid and binding upon the Authority in accordance with its terms and will
not, in and of itself, adversely affect the exclusion from gross income for
federal tax purposes of the interest on the Bonds.
(d) If Owners of not less than the percentage of Bonds required by this
Section 12.03 shall have consented to and approved the execution and delivery
thereof as herein provided, no Owner shall have any right to object to the
execution and delivery of such Supplemental Indenture, or to object to any of
the terms and provisions contained therein or the operation thereof, or in any
manner to question the propriety of the execution and delivery thereof, or to
enjoin or restrain the Authority or the Trustee from executing and delivering
the same or from taking any action pursuant to the provisions thereof.
Section XII.04. Effect of Supplemental Indenture. Upon the execution and
delivery of any Supplemental Indenture pursuant to the provisions of this
Article XII, this Indenture shall be, and be deemed to be, modified, altered,
amended or supplemented in accordance therewith, and the respective rights,
duties and obligations under this Indenture of the Authority, the Trustee and
Owners of all Bonds then Outstanding shall thereafter be determined, exercised
and enforced under this Indenture subject in all respects to such
modifications, alterations, amendments and supplements.
Section XII.05. Consent of the Company. Anything herein to the contrary
notwithstanding, any Supplemental Indenture under this Article XII which
affects any rights, powers, agreements or obligations of the Company under
the Loan Agreement, or requires a revision of the Loan Agreement, shall not
become effective unless and until the Company shall have consented to such
Supplemental Indenture.
Section XII.06. Amendment of Loan Agreement without Consent of
Owners. Without the consent of or notice to the Owners of the Bonds, the
Authority may enter into any Supplemental Loan Agreement, and the Trustee may
consent thereto, as may be required (a) by the provisions of the Loan Agreement
and this Indenture, (b) for the purpose of curing any formal defect, omission,
inconsistency or ambiguity therein, (c) to provide any additional procedures,
covenants or agreements necessary or desirable to maintain the tax-exempt
status of interest on the Bonds, or (d) in connection with any other change
therein which is not materially adverse to the Owners of the Bonds. A revision
of Exhibit A to the Loan Agreement pursuant to Section 3.02 thereof shall not
be deemed a Supplemental Loan Agreement for purposes of this Indenture.
Before the Authority shall enter into, and the Trustee shall consent to, any
Supplemental Loan Agreement pursuant to this Section 12.06, there shall have
been delivered to the Trustee an opinion of Bond Counsel stating that such
Supplemental Loan Agreement is authorized or permitted by this Indenture and
the Act, complies with their respective terms, will, upon the execution and
delivery thereof, be valid and binding upon the Authority and the Company in
accordance with its terms and will not, in and of itself, adversely affect the
exclusion from gross income for federal tax purposes of interest on the Bonds.
Section XII.07. Amendment of Loan Agreement with Consent of
Owners. Except in the case of Supplemental Loan Agreements referred to in
Section 12.06 hereof, the Authority shall not enter into, and the Trustee shall
not consent to, any Supplemental Loan Agreement without the written approval or
consent of the Owners of not less than a majority in aggregate principal amount
of the Bonds then Outstanding which would be adversely affected thereby, given
and procured as provided in Section 12.03 hereof; provided, however, that,
unless approved in writing by the Owners of all Bonds then Outstanding which
would be adversely affected thereby, nothing herein contained shall permit, or
be construed as permitting, a change in the obligations of the Company under
Section 5.01 of the Loan Agreement. If at any time the Authority or the Company
shall request the consent of the Trustee to any such proposed Supplemental Loan
Agreement, the Trustee shall cause notice of such proposed Supplemental Loan
Agreement to be given in the same manner as provided by Section 12.03 hereof
with respect to Supplemental Indentures. Such notice shall briefly set forth
the nature of such proposed Supplemental Loan Agreement and shall state that
copies of the instrument embodying the same are on file at the Principal Office
of the Trustee for inspection by all Owners of the Bonds. The Authority may
enter into, and the Trustee may consent to, any such proposed Supplemental Loan
Agreement subject to the same conditions, and with the same effect, as provided
by Section 12.03 hereof with respect to Supplemental Indentures.
ARTICLE XIII
MISCELLANEOUS
Section XIII.01. Successors of the Authority.
In the event of the dissolution of the Authority, all the covenants,
stipulations, promises and agreements in this Indenture contained, by or on
behalf of, or for the benefit of, the Authority, shall bind or inure
to the benefit of the successors of the Authority from time to time
nd any entity, officer, board, commission, agency or instrumentality to
whom or to which any power or duty of the Authority shall be transferred.
Section XIII.02. Parties in Interest. Except as herein otherwise
specifically provided, nothing in this Indenture expressed or implied is
intended or shall be construed to confer upon any person, firm or corporation
other than the Authority, the Company and the Trustee and their successors and
assigns and the Owners of the Bonds any right, remedy or claim under or by
reason of this Indenture, this Indenture being intended to be for the sole and
exclusive benefit of the Authority, the Company and the Trustee and their
successors and assigns and the Owners of the Bonds.
Section XIII.03. Severability. In case any one or more of the provisions of
this Indenture or of the Loan Agreement or of the Bonds shall, for any reason,
be held to be illegal or invalid, such illegality or invalidity shall not
affect any other provisions of this Indenture or of the Loan Agreement or of
such Bonds, and this Indenture and the Loan Agreement and such Bonds shall be
construed and enforced as if such illegal or invalid provisions had not been
contained herein or therein.
Section XIII.04. No Personal Liability of Authority Officials. No
covenant or agreement contained in the Bonds or in this Indenture shall be
deemed to be the covenant or agreement of any director, official, officer,
agent, or employee of the Authority in his individual capacity, and neither the
members of the Board of Directors of the Authority nor any official executing
the Bonds shall be liable personally on the Bonds or be subject to any personal
liability or accountability by reason of the issuance thereof.
Section XIII.05. Bonds Owned by the Authority or the Company. In
determining whether Owners of the requisite aggregate principal amount of the
Bonds have concurred in any direction, consent or waiver under this Indenture,
Bonds which are owned by the Authority or the Company or by any person directly
or indirectly controlling or controlled by or under direct or indirect common
control with the Company (unless the Authority, the Company or such person owns
all Bonds which are then Outstanding, determined without regard to this Section
13.05) shall be disregarded and deemed not to be Outstanding for the purpose of
any such determination, except that, for the purpose of determining whether the
Trustee shall be protected in relying on any such direction, consent or waiver,
only Bonds which the Trustee knows are so owned shall be so disregarded. Upon
the request of the Trustee, the Company and the Authority shall furnish to the
Trustee a certificate identifying all Bonds,if any, actually known to either of
them to be owned or held by or for the account of any of the above-described
persons, and the Trustee shall be entitled to rely on such certificate as
conclusive evidence of the facts set forth therein and that all other Bonds are
Outstanding for the purposes of such determination. Bonds so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Bonds and that the pledgee is not the Authority or the
Company or any person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company. In case of a dispute
as to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee.
Section XIII.06. Counterparts. This Indenture may be executed in any number
of counterparts, each of which, when so executed and delivered, shall be an
original; but such counterparts shall together constitute but one and the same
Indenture.
Section XIII.07. Governing Law. The laws of the State of Arizona shall
govern the construction and enforcement of this Indenture and of all Bonds,
except that the laws of the State of New York shall govern the construction
and enforcement of the rights and duties of the Trustee hereunder and the
construction of Section 13.09 hereof and the computation of any period of
grace provided herein.
Section XIII.08. Notices.
Except as otherwise provided in this Indenture, all notices, certificates,
requests requisitions or other communications by the Authority,the Company, the
Trustee, the Paying Agent,any Co-Paying Agent or the Registrar pursuant to this
Indenture shall be in writing and shall be sufficiently given and shall be
deemed given when mailed by registered mail, postage prepaid, addressed as
follows: If to the Authority, c/o Platt & Lee, P.C., 185 South Second West
Street, St. Johns, Arizona 85936; if to the Company, at 220 West Sixth Street,
Tucson, Arizona 85702, Attention: Treasurer; if to the Trustee, at 100 Wall
Street, Suite 1600, New York, New York 10005, Attention: Vice President; if to
the Paying Agent, any Co-Paying Agent or the Registrar, at the address
designated in the acceptance of appointment or engagement. Any of the foregoing
may, by notice given hereunder to each of the others, designate any further or
different addresses to which subsequent notices, certificates, requests or
other communications shall be sent hereunder.
Section XIII.09. Holidays.
If the date for making any payment or the last date for
performance of any act or the exercising of any right, as provided in this
Indenture, shall be a Saturday, Sunday or a public holiday in the city in which
is located the Principal Office of the Trustee, such payment may be made or act
performed or right exercised on the next succeeding business day, with the same
force and effect as if done on the nominal date provided in this Indenture, and
no interest shall accrue for the period after such nominal date. If the last
day of any period of grace, as provided in this Indenture, shall be a Saturday,
Sunday or a public holiday in the city in which is located the Principal Office
of the Trustee, the last day of such period of grace shall be deemed to be the
next succeeding business day.
Section XIII.10. Statutory Notice Regarding Cancellation of Contracts.
As required by the provisions of Section 38-511, Arizona Revised Statutes, as
amended, notice is hereby given that political subdivisions of the State of
Arizona or any of their departments or agencies may, within three (3) years of
its execution, cancel any contract, without penalty or further obligation, made
by the political subdivisions or any of their departments or agencies on or
after September 30, 1988, if any person significantly involved in initiating,
negotiating, securing, drafting or creating the contract on behalf of the
political subdivisions or any of their departments or agencies is, at any time
while the contract or any extension of the contact is in effect, an employee
or agent of any other party to the contract in any capacity or a consultant to
any other party of the contract with respect to the subject matter of the
contract.
The Trustee covenants and agrees not to employ as an employee, agent or,with
respect to the subject matter of this Indenture, a consultant, any person
actually known by the Trustee to be significantly involved in initiating,
negotiating, securing, drafting or creating such Indenture on behalf of the
Authority within three (3) years from the execution hereof, unless a waiver is
provided by the Authority.
IN WITNESS WHEREOF, The Industrial Development Authority of the County of
Apache has caused this Indenture to be executed by its President and First
Trust of New York, National Association has caused this Indenture to be
executed on its behalf by its Vice President, all as of the day and year
first above written.
THE INDUSTRIAL DEVELOPMENT AUTHORITY
OF THE COUNTY OF APACHE
By:
President
FIRST TRUST OF NEW YORK,
NATIONAL ASSOCIATION
By:
Vice President
EXHIBIT A
(FORM OF BOND)
No.
The Industrial Development Authority
of the County of Apache
Pollution Control Revenue Bond,
1998 Series B
(Tucson Electric Power Company Project)
Interest Rate (per annum):
Maturity Date: Dated:
Cusip:
Registered Owner:
Principal Amount: Dollars
The Industrial Development Authority of the County of Apache, an Arizona
nonprofit corporation designated by law as a political subdivision of the State
of Arizona (the "Authority"), for value received, hereby promises to pay (but
only out of the Receipts and Revenues of the Authority from the Loan Agreement,
as hereinafter defined, and other moneys pledged therefor) to the Registered
Owner identified above or registered assigns, on the Maturity Date set forth
above, upon the presentation and surrender hereof, the Principal Amount set
forth above and to pay (but only out of the Receipts and Revenues of the
Authority from the Loan Agreement and other moneys pledged therefor), interest
on said Principal Amount until payment of said Principal Amount has been made
or duly provided for, from the date hereof,at the Interest Rate set forth
above, semi-annually on the first days of March and September in each year,
commencing September 1, 1998. Interest will be calculated on the basis of a
360-day year of twelve 30-day months.
The principal of and premium, if any, on this Bond are payable at the
principal office of First Trust of New York, National Association, as Paying
Agent,or at the principal office of any co-paying agent appointed in accordance
with the Indenture (as hereinafter defined), at the option of the Registered
Owner hereof. Interest on this Bond is payable by check drawn upon the Paying
Agent and mailed to the Registered Owner of this Bond as of the close of
business on the Record Date (as defined in the Indenture) at the registered
address of such Registered Owner;notwithstanding the foregoing, upon request to
the Paying Agent by a Registered Owner of not less than $1,000,000 in aggregate
principal amount of Bonds, interest on such Bonds and, after presentation and
surrender of such Bonds, the principal thereof shall be paid to such Registered
Owner by wire transfer to the account maintained within the continental United
States specified by such Registered Owner or,if such Registered Owner maintains
an account with the entity acting as Paying Agent,by deposit into such account.
Payment of the principal of and premium, if any, and interest on, this Bond
shall be in any coin or currency of the United States of America as, at the
respective times of payment,shall be legal tender for the payment of public and
private debts.
This Bond is one of the duly authorized Pollution Control Revenue Bonds, 1998
Series B (Tucson Electric Power Company Project)(the "Bonds") of the Authority,
aggregating Ninety Nine Million Eight Hundred Thousand Dollars ($99,800,000) in
principal amount, issued under and pursuant to the Constitution and laws of the
State of Arizona, particularly Title 35, Chapter 5, Arizona Revised Statutes,as
amended (the "Act"), and the Indenture of Trust, dated as of March 1, 1998 (the
"Indenture"), between the Authority and First Trust of New York,
National Association, as trustee (the "Trustee"), for the purpose of
refinancing, by payment or redemption of (a) $41,400,000 aggregate principal
amount of the Authority's Pollution Control Revenue Bonds, 1981 Series A(Tucson
Electric Power Company Project) (the "1981 Series A Bonds"), or provision
therefor, which represents the extent to which the 1981 Series A Bonds financed
a portion of the costs of the acquisition, construction, improvement and
equipping of certain air and water pollution control and sewage and solid waste
disposal facilities (the "Pollution Control Facilities") at Unit No. 2 of the
Springerville Generating Station (the "Plant"); (b) $58,400,000 aggregate
principal amount of the Authority's Pollution Control Revenue Bonds, 1981
Series B (Tucson Electric Power Company Project) (the "1981 Series B Bonds"),or
provision therefor,which represents the extent to which the 1981 Series B Bonds
financed a portion of the costs of the acquisition, construction, improvement
and equipping of the Pollution Control Facilities and a portion of costs of the
acquisition, construction and equipping of facilities for furnishing electric
energy at Unit No. 2. Pursuant to the Loan Agreement, dated as of March 1,1998
(the "Loan Agreement"),between the Authority and Tucson Electric Power Company,
a corporation organized and existing under the laws of the State of
Arizona (the "Company"), the proceeds of the Bonds, other than accrued
interest, if any, paid by the initial purchasers thereof, will be loaned to the
Company.
Neither Apache County, Arizona nor the State of Arizona shall in any event be
liable for the payment of the principal of or premium, if any, or interest on
the Bonds, and neither the Bonds, nor the premium, if any, or the interest
thereon, shall be construed to constitute an indebtedness of Apache County,
Arizona or the State of Arizona within the meaning of any constitutional or
statutory provisions whatsoever. The Bonds and the premium, if any, and the
interest thereon are limited obligations of the Authority payable solely from
the Receipts and Revenues of the Authority from the Loan Agreement and other
moneys pledged therefor under the Indenture.
The Bonds are equally and ratably secured, to the extent provided in the
Indenture, by the pledge thereunder of the "Receipts and Revenues of the
Authority from the Loan Agreement", which term is used herein as defined in the
Indenture and which as therein defined means all moneys paid or payable to the
Trustee for the account of the Authority by the Company in respect of the loan
payments, including all receipts of the Trustee which, under the provisions of
the Indenture, reduce the amounts of such payments. The Authority has also
pledged and assigned to the Trustee as security for the Bonds all other rights
and interests of the Authority under the Loan Agreement (other than its rights
to indemnification and its administrative expenses and certain other rights).
The transfer of this Bond shall be registered upon the registration books
kept at the principal office of First Trust of New York, National Association,
as Registrar, at the written request of the Registered Owner hereof or his
attorney duly authorized in writing,upon surrender of this Bond at said office,
together with a written instrument of transfer satisfactory to the Registrar
duly executed by the Registered Owner or his duly authorized attorney.
In the manner and with the effect provided in the Indenture, each of the
Bonds may be redeemed prior to maturity, as follows:
(a) The Bonds shall be subject to redemption by the Authority, at the
direction of the Company, on any date on or after March 1, 2003 in whole at
any time or in part from time to time, at the applicable redemption price
(expressed as a percentage of principal amount) set forth below, plus
accrued interest to the redemption date:
Redemption Period Redemption Price
March 1, 2003 through February 29, 2004 102%
March 1, 2004 through February 28, 2005 101%
March 1, 2005 and thereafter 100%
(b) The Bonds shall be subject to redemption by the Authority, at the
direction of the Company, in whole at any time at the principal amount
thereof plus accrued interest to the redemption date, if:
(i) the Company shall have determined that the continued operation of
the Facilities or the Plant is impracticable, uneconomical or undesirable
for any reason;
(ii) all or substantially all of the Facilities or the Plant shall have
been condemned or taken by eminent domain; or
(iii) the operation of the Facilities or the Plant shall have been
enjoined or shall have otherwise been prohibited by, or shall conflict
with, any order,decree, rule or regulation of any court or of any federal,
state or local regulatory body,administrative agency or other governmental
body.
(c) The Bonds shall be subject to mandatory redemption by the Authority,
at the principal amount thereof plus accrued interest to the redemption date,
on the 180th day (or such earlier date as may be designated by the Company)
after a final determination by a court of competent jurisdiction or an
administrative agency, to the effect that, as a result of a failure by the
Company to perform or observe any covenant, agreement or representation
contained in the Loan Agreement, the interest payable on the Bonds is
included for federal income tax purposes in the gross income of the owners
thereof, other than any owner of a Bond who is a "substantial user" of the
Facilities or a "related person" within the meaning of Section 103(b)(13)
of the Internal Revenue Code of 1954, as amended (the "1954 Code").
No determination by any court or administrative agency shall be
considered final for the purposes of this paragraph (c) unless the Company
shall have been given timely notice of the proceeding which resulted in such
determination and an opportunity to participate in such proceeding, either
directly or through an owner of a Bond, and until the conclusion of any
appellate review sought by any party to such proceeding or the expiration of
the time for seeking such review. The Bonds shall be redeemed either in whole
or in part in such principal amount that, in the opinion of Bond Counsel, the
interest payable on the Bonds, including the Bonds remaining outstanding
after such redemption, would not be included in the gross income of any owner
thereof, other than an owner of a Bond who is a "substantial user" of the
Facilities or a "related person" within the meaning of Section 103(b)(13) of
the 1954 Code.
If less than all of the Bonds at the time outstanding are to be called for
redemption, the particular Bonds or portions of Bonds to be redeemed shall
be selected by the Trustee, in such manner as the Trustee in its discretion
may deem proper, in the principal amounts designated to the Trustee by the
Company or otherwise as required by the Indenture.
In the event any of the Bonds are called for redemption, the Trustee shall
give notice, in the name of the Authority, of the redemption of such Bonds.
Such notice shall be given by mailing a copy of the redemption notice by
first-class mail at least thirty (30) days prior to the date fixed for
redemption to the Registered Owners of the Bonds to be redeemed at the
addresses shown on the registration books; provided, however, that failure duly
to give such notice by mailing, or any defect therein, shall not affect the
validity of any proceedings for the redemption of the Bonds as to which there
shall be no such failure or defect.
With respect to any notice of redemption of Bonds in accordance with the
redemption provisions lettered (a) or (b) above,unless, upon the giving of such
notice, such Bonds shall be deemed to have been paid within the meaning of the
Indenture, such notice shall state that such redemption, shall be conditional
upon the receipt, by the Trustee on or prior to the opening of business on the
date fixed for such redemption of moneys sufficient to pay the principal of
and premium, if any, and interest on such Bonds to be redeemed, and that if
such moneys shall not have been so received said notice shall be of no force
and effect and the Authority shall not be required to redeem such Bonds. In
the event that such notice of redemption contains such a condition and such
moneys are not so received, the redemption shall not be made and the Trustee
shall within a reasonable time thereafter give notice, in the manner in which
the notice of redemption was given, that such moneys were not so received.
If a notice of redemption shall be unconditional, or if the conditions of a
conditional notice of redemption shall have been satisfied, then upon
presentation and surrender of Bonds so called for redemption at the place or
places of payment, such Bonds shall be redeemed.
Any Bonds and portions of Bonds which have been duly selected for redemption
shall cease to bear interest on the specified redemption date provided that
moneys sufficient to pay the principal of, premium,if any, and interest on such
Bonds shall be on deposit with the Trustee on the date fixed for redemption so
that such Bonds will be deemed to be paid in accordance with the Indenture and
such Bonds shall thereafter cease to be entitled to any lien, benefit or
security under the Indenture.
The Registered Owner of this Bond shall have no right to enforce the
provisions of the Indenture, or to institute action to enforce the covenants
therein, or to take any action with respect to any default under the Indenture,
or to institute, appear in or defend any suit or other proceeding with respect
thereto, except as provided in the Indenture.
With certain exceptions as provided therein, the Indenture and the Loan
Agreement may be modified or amended only with the consent of the Registered
Owners of a majority in aggregate principal amount of all Bonds outstanding
under the Indenture which would be adversely affected thereby.
Reference is hereby made to the Indenture and the Loan Agreement, copies of
which are on file with the Trustee, for the provisions, among others, with
respect to the nature and extent of the rights, duties and obligations of the
Authority, the Company, the Trustee and the Registered Owners of the Bonds.
The Registered Owner of this Bond, by the acceptance hereof, is deemed to have
agreed and consented to the terms and provisions of the Indenture and the
Loan Agreement.
Among other things, as provided in the Indenture and subject to certain
limitations therein set forth, this Bond or any portion of the principal amount
hereof will be deemed to have been paid within the meaning and with the effect
expressed in the Indenture, and the entire indebtedness of the Authority in
respect thereof shall be satisfied and discharged,if there has been irrevocably
deposited with the Trustee, in trust, money in an amount which will be
sufficient and/or Government Obligations (as defined in the Indenture), the
principal of and interest on which,when due, without regard to any reinvestment
thereof, will provide moneys which,together with moneys deposited with or held
by the Trustee, will be sufficient, to pay when due the principal of and
premium, if any, and interest on this Bond or such portion of the principal
amount hereof when due.
Among other things, the Loan Agreement contains terms, provisions and
conditions relating to the consolidation or merger of the Company with or into,
and the sale, transfer or other disposition of assets to, another Person (as
defined in the Loan Agreement), to the assumption by such other Person, in
certain circumstances, of all of the obligations of the Company under the
Loan Agreement and to the release and discharge of the Company, in certain
circumstances, from such obligations.
The Authority, the Trustee, the Registrar, the Paying Agent and any co-paying
agent may deem and treat the person in whose name this Bond is registered as
the absolute owner hereof for all purposes, whether or not this Bond is
overdue, and neither the Authority, the Trustee, the Paying Agent nor any
co-paying agent shall be affected by any notice to the contrary.
It is hereby certified, recited and declared that all acts, conditions and
things required by the Constitution and laws of the State of Arizona to exist,
to have happened and to have been performed, precedent to and in the execution
and delivery of the Indenture and the issuance of this Bond, do exist, have
happened and have been performed in regular and due form as required by law.
No covenant or agreement contained in this Bond or the Indenture shall be
deemed to be a covenant or agreement of any official, officer, agent or
employee of the Authority in his individual capacity, and neither the members
of the Board of Directors of the Authority, nor any official executing this
Bond, shall be liable personally on this Bond or be subject to any personal
liability or accountability by reason of the issuance or sale of this Bond.
This Bond shall not be entitled to any right or benefit under the Indenture,
or be valid or become obligatory for any purpose, until this Bond shall have
been authenticated by the execution by the Trustee,or its successor as Trustee,
of the certificate of authentication inscribed hereon.
IN WITNESS WHEREOF, The Industrial Development Authority of The County of
Apache has caused this Bond to be executed with the manual or facsimile
signature of its President or Vice President and a facsimile of its official
seal to be imprinted hereon and attested with the manual or facsimile signature
of its Secretary or Assistant Secretary.
THE INDUSTRIAL DEVELOPMENT
AUTHORITY OF THE COUNTY OF APACHE
(Seal)
By.......................................................
President
ATTEST:
...........................................
Secretary
EXHIBIT B
(FORM FOR ORDINARY REGISTRATION OF TRANSFER)
COMPLETE AND SIGN THIS FORM FOR ORDINARY
REGISTRATION OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
Please Insert Social Security Or Other Identifying Number of Assignee
..............................................................................
..............................................................................
Please print or typewrite name and address including postal zip code of
assignee
..............................................................................
this bond and all rights thereunder, hereby irrevocably constituting and
appointing attorney to register such transfer on the
registration books in the principal office of the Registrar, with full power
of substitution in the premises.
Dated:.........................
....................................................................
NOTE: The signature on this assignment must
correspond with the name as written on the face of
this Bond in every particular, without alteration,
enlargement or any change whatsoever.
EXHIBIT C
(FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is to certify that this Bond is one of the Bonds described in the
within-mentioned Indenture.
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
as Trustee
By...................................................
Authorized Officer
Date of Authentication:......................