EXHIBIT 4(f)
INDENTURE OF TRUST
(1998 Series C)
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
Industrial Development Revenue Bonds,
1998 Series C
(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 9
Section 2.07.Lost or Destroyed Bonds or Bonds Canceled in Error 10
Section 2.08. .....Transfer, Registration and Exchange of Bonds 10
Section 2.09. ................................Other Obligations 12
Section 2.10 ...................................Temporary Bonds 12
Section 2.11. ............................Cancellation of Bonds 12
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 15
ARTICLE IV
THE BOND FUND
Section 4.01. ............................Creation of Bond Fund 16
Section 4.02. ............................................Liens 16
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 16
Section 4.07. .............................Moneys Held in Trust 17
ARTICLE V
DISPOSITION OF PROCEEDS
Section 5.01. ..........................Disposition of Proceeds 17
ARTICLE VI
INVESTMENTS
Section 6.01. ......................................Investments 17
ARTICLE VII
GENERAL COVENANTS
Section 7.01. ...........................No General Obligations 18
Section 7.02.........Performance of Covenants of the Authority;
Representations 18
Section 7.03.......Maintenance of Rights and Powers; Compliance
with Laws 18
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 20
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 23
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 24
Section 9.11. .........................Severability of Remedies 25
ARTICLE X
TRUSTEE; PAYING AGENT AND CO-PAYING AGENTS; REGISTRAR
Section 10.01. ............................Acceptance of Trusts 25
Section 10.02. ..................No Responsibility for Recitals 25
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 27
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 28
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 29
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 31
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 32
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 35
Section 12.07.Amendment of Loan Agreement with Consent of Owners. 35
ARTICLE XIII
MISCELLANEOUS
Section 13.01. .....................Successors of the Authority 36
Section 13.02. .............................Parties in Interest 36
Section 13.03. ....................................Severability 36
Section 13.04. ....No Personal Liability of Authority Officials 36
Section 13.05. .....Bonds Owned by the Authority or the Company 36
Section 13.06. ....................................Counterparts 37
Section 13.07. ...................................Governing Law 37
Section 13.08. .........................................Notices 37
Section 13.09. ........................................Holidays 37
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 C), dated as of March 1, 1998 (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 $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 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 the air and water pollution control facilities and sewage and
solid waste disposal facilities and facilities for the furnishing of
electric energy (the "Facilities") ;
WHEREAS, the Authority proposes to issue and sell its revenue bonds as
provided herein (the "Bonds") to refinance, by the payment or redemption of
$16,500,000 principal amount of the 1981 Bonds, or provision therefor, which
represents the extent to which the 1981 Bonds financed, the portion of the
costs of the acquisition, construction, improvement and equipping of the
Facilities, 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:
ARTICLE I
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" 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 facilities for electric transmission and/or
distribution currently existing, under construction and to be constructed
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 Bonds:
"1981 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.
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 1981 Bonds, an issue of Bonds,
entitled to the benefit, protection and security of this Indenture, in the
aggregate principal amount of Sixteen Million Five Hundred Thousand Dollars
($16,500,000). Each of the Bonds shall be designated by the title "The
Industrial Development Authority of the County of Apache Industrial
Development Revenue Bond, 1998 Series C (Tucson Electric Power Company
Project)". The Bonds shall mature, subject to prior redemption upon the
terms and conditions hereinafter set forth, on March 1, 2026 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 eighty-five one-hundredths per centum (5.85%) 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 is impracticable, uneconomical or undesirable for any
reason;
(ii) all or substantially all of the Facilities shall have been
condemned or taken by eminent domain; or
(iii) the operation of the Facilities 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
Industrial Development Revenue Bonds, 1998 Series C (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 Sections 12.06 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 Industrial Development Revenue
Bonds, 1998 Series C (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
5.03 of 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 the
Company. 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 Section
10.05 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 4.03 and 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 and 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
Industrial Development Revenue Bond,
1998 Series C
(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 Industrial Development Revenue
Bonds, 1998 Series C (Tucson Electric Power Company Project) (the "Bonds")
of the Authority, aggregating Sixteen Million Five Hundred Thousand Dollars
($16,500,000) 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
$16,500,000 aggregate principal amount of the Authority's Pollution Control
Revenue Bonds, 1981 Series B (Tucson Electric Power Company Project), or
provision therefor, a portion of the costs of the acquisition, construction,
improvement and equipping of certain facilities for the furnishing of
electric energy (the "Facilities"). 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 is impracticable, uneconomical or undesirable for any
reason;
(ii) all or substantially all of the Facilities shall have been
condemned or taken by eminent domain; or
(iii) the operation of the Facilities 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:......................