Exhibit 4.2
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MONTGOMERY COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY
TO
DAUPHIN DEPOSIT BANK AND TRUST COMPANY, AS TRUSTEE
TRUST INDENTURE
Dated as of
March 1, 1997
Securing
$8,400,000
MONTGOMERY COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY
Federally Taxable Variable Rate Demand Revenue Bonds
(Neose Technologies, Inc. Project)
Series B of 1997
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TABLE OF CONTENTS
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Preambles................................................................... 1
Granting Clauses............................................................ 1
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions............................................... 4
SECTION 1.02. Interpretation; Time of Day...............................12
SECTION 1.03. Captions, Headings and Table of Contents..................12
ARTICLE II
AUTHORIZATION AND TERMS OF BONDS
SECTION 2.01. Amount, Form and Issuance of Bonds........................13
SECTION 2.02. Designation, Denominations, Maturity, Dated Dates,
Interest Accrual and Tender.............................13
SECTION 2.03. Weekly Rate...............................................14
SECTION 2.04. Term Rate.................................................15
SECTION 2.05. Conversion at Option of Borrower..........................16
SECTION 2.06. Execution and Authentication of Bonds.....................17
SECTION 2.07. Source of Payment of Bonds................................17
SECTION 2.08. Payment and Ownership of Bonds............................17
SECTION 2.09. Registration, Transfer and Exchange of Bonds..............18
SECTION 2.10. Mutilated, Lost, Wrongfully Taken or Destroyed Bonds......19
SECTION 2.11. Cancellation of Bonds.....................................20
SECTION 2.12. Special Agreement with Holders............................20
SECTION 2.13. Book Entry System for the Bonds...........................21
ARTICLE III
REDEMPTION OF BONDS
SECTION 3.01. Terms of Redemption.......................................24
SECTION 3.02. Partial Redemption........................................24
SECTION 3.03. Issuer's Election to Redeem...............................25
SECTION 3.04. Notice of Redemption......................................25
SECTION 3.05. Payment of Redeemed Bonds.................................26
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ARTICLE IV
PURCHASE AND REMARKETING OF BONDS
SECTION 4.01. Purchase on Demand of Holder During Weekly Mode...........28
SECTION 4.02. Mandatory Purchase on Conversion Date and at End of Term
Rate Period; upon Expiration of Letter of Credit;
and at Direction of Bank................................30
SECTION 4.03. Remarketing...............................................32
SECTION 4.04. Drawings on Letter of Credit for Purchase of Bonds........33
SECTION 4.05. Bonds Purchased with Proceeds of Letter of Credit.........34
SECTION 4.06. Borrower Bonds............................................35
SECTION 4.07. No Purchases After Acceleration;
Inadequate Funds for Purchases..........................35
ARTICLE V
FUNDS AND LETTER OF CREDIT
SECTION 5.01. Creation of Project Fund..................................37
SECTION 5.02. Disbursements from and Records of Project Fund............37
SECTION 5.03. Disposition of Excess Bond Proceeds.......................37
SECTION 5.04. Bond Fund.................................................37
SECTION 5.05. Investment of Bond Fund and Project Fund..................39
SECTION 5.06. Bond Fund Moneys to be Held in Trust......................41
SECTION 5.07. Nonpresentment of Bonds...................................41
SECTION 5.08. Letter of Credit..........................................41
ARTICLE VI
COVENANTS AND REPRESENTATIONS
OF ISSUER
SECTION 6.01. Corporate Existence; Compliance with Laws.................45
SECTION 6.02. Payment of Bond Service...................................45
SECTION 6.03. No Further Assignment of Revenues.........................45
SECTION 6.04. Filings...................................................45
SECTION 6.05. Rights and Enforcement of Agreement.......................45
SECTION 6.06. Further Assurances........................................46
SECTION 6.07. Observance and Performance Agreements.....................46
SECTION 6.08. Representations and Warranties............................46
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ARTICLE VII
DEFAULT AND REMEDIES
SECTION 7.01. Defaults; Events of Default...............................47
SECTION 7.02. Notice of Default.........................................48
SECTION 7.03. Acceleration..............................................48
SECTION 7.04. Other Remedies; Rights of Holders.........................50
SECTION 7.05. Right of Holders to Direct Proceedings....................51
SECTION 7.06. Application of Moneys.....................................51
SECTION 7.07. Remedies Vested in Trustee................................53
SECTION 7.08. Rights and Remedies of Holders............................53
SECTION 7.09. Termination of Proceedings................................54
SECTION 7.10. Waivers of Events of Default..............................54
SECTION 7.11. Certain Rights of Issuer..................................54
SECTION 7.12. Trustee's Right to Appointment of Receiver................55
SECTION 7.13. Trustee and Holders Entitled to All Benefits Under Act....55
SECTION 7.14. Trustee's Obligation to Banks Upon Payment of
All Amounts Due Holders................................ 55
ARTICLE VIII
TRUSTEE AND REMARKETING AGENT
SECTION 8.01. Trustee's Acceptance and Responsibilities.................56
SECTION 8.02. Certain Rights and Obligations of Trustee.................57
SECTION 8.03. Fees, Charges and Expenses of Trustee.....................60
SECTION 8.04. Intervention by Trustee...................................60
SECTION 8.05. Successor Trustee.........................................60
SECTION 8.06. Resignation by Trustee....................................61
SECTION 8.07. Removal of Trustee........................................61
SECTION 8.08. Appointment of Successor Trustee..........................61
SECTION 8.09. Adoption of Authentication................................63
SECTION 8.10. Designation and Succession of Authenticating Agent,
Bond Registrar, Transfer Agent, Tender Agent
and Paying Agent....................................... 63
SECTION 8.11. Dealing in Bonds..........................................64
SECTION 8.12. Representations, Agreements and Covenants of Trustee......64
SECTION 8.13. Appointment of Remarketing Agent..........................64
SECTION 8.14. Qualifications of Remarketing Agent.......................65
SECTION 8.15. Compensation and Expenses of Remarketing Agent............65
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS
SECTION 9.01. Supplemental Indentures Not Requiring Consent of Holders..66
SECTION 9.02. Supplemental Indentures Requiring Consent of Holders......67
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SECTION 9.03. Consent of Borrower and Participating Bank................67
SECTION 9.04. Authorization to Trustee; Effect of Supplement............67
SECTION 9.05. Modification by Unanimous Consent.........................68
SECTION 9.06. Amendment of Loan Agreement...............................68
SECTION 9.07. Amendment of Letter of Credit.............................68
SECTION 9.08. Trustee Authorized to Join in Supplements and
Amendments; Reliance on Counsel.........................68
SECTION 9.09. Bank Consent..............................................68
SECTION 9.10. Notice to Rating Service..................................69
ARTICLE X
DEFEASANCE
SECTION 10.01. Defeasance................................................70
SECTION 10.02. Provision for Payment.....................................70
SECTION 10.03. Deposit of Funds for Payment of Bonds.....................71
SECTION 10.04. Survival of Certain Provisions............................72
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Limitation of Rights; No Personal Recourse................73
SECTION 11.02. Severability..............................................73
SECTION 11.03. Notices...................................................73
SECTION 11.04. Suspension of Mail........................................74
SECTION 11.05. Payments Due on Saturdays, Sundays and Holidays...........75
SECTION 11.06. Instruments of Holders....................................75
SECTION 11.07. Binding Effect............................................75
SECTION 11.08. Counterparts..............................................75
SECTION 11.09. Governing Law.............................................76
Execution...................................................................77
Exhibit A - Bond Form......................................................A-1
Exhibit omitted. The Registrant notes that the Bond has been filed separately as
Exhibit 4.3 to this Quarterly Report on Form 10-Q.
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TRUST INDENTURE
THIS TRUST INDENTURE, dated as of March 1, 1997 between MONTGOMERY
COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY (the "Issuer"), a public instrumentality
and body corporate and politic of the Commonwealth of Pennsylvania, and DAUPHIN
DEPOSIT BANK AND TRUST COMPANY, a Pennsylvania banking corporation, as Trustee
(the "Trustee") (the capitalized terms used in the recitals and granting clauses
hereof being used therein as defined in Article I of this Trust Indenture),
WITNESSETH THAT:
A. Pursuant to the Act, the Issuer has authorized and approved the
Project and the financing thereof through the issuance of the Bonds and the loan
of the proceeds thereof to the Borrower pursuant to the Loan Agreement to
finance costs of the Project;
B. The Bonds will be issued under and secured by this Indenture, and
the Issuer is empowered and authorized to execute and deliver this Indenture and
the Loan Agreement and to do or cause to be done all acts provided or required
herein or therein to be performed on its part;
C. All acts and conditions required to happen, exist and be performed
precedent to and in the issuance of the Bonds and the execution and delivery of
this Indenture have happened, exist and have been performed (i) to make the
Bonds, when issued, delivered and authenticated, valid and binding legal
obligations of the Issuer and (ii) to make this Indenture a valid, binding and
legal trust agreement for the security of the Bonds; and
D. The Trustee has accepted the trusts created by this Indenture, and
in evidence thereof has joined in the execution hereof.
NOW, THEREFORE, the Issuer, intending to be legally bound, in
consideration of the acceptance by the Trustee of the trusts hereby created and
of the purchase and acceptance of the Bonds by the Holders, 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 of which is hereby acknowledged, in
order to secure, in the following order of priority, first, the payment of the
principal of, premium, if any, on and interest on the Bonds according to their
tenor and effect and the performance and observance by the Issuer of all the
covenants expressed or implied herein and in the Bonds, second, the payment to
the Bank and performance of the reimbursement and other obligations of the
Participating Bank under the Participating Bank Agreement, and, third, the
payment to the Participating Bank and performance of the reimbursement and other
obligations of the Borrower under the Reimbursement Agreement, does hereby
assign, transfer and pledge to the Trustee and its successors in trust and its
and their assigns forever and grant to the Trustee and its successors in trust
and its and their assigns a security interest in:
a. All right, title and interest (but not the obligations) of
the Issuer under and pursuant to the terms of the Loan Agreement, all
Loan Payments and all other payments, revenues and receipts receivable
by the Issuer thereunder (except for the Unassigned Issuer's Rights);
and
b. All of the right, title and interest of the Issuer in and
to all Funds and Accounts established under this Indenture and all
moneys and investments now or hereafter held therein and all present
and future Revenues.
TO HAVE AND TO HOLD, the Loan Agreement, Funds, Accounts, Revenues and
the other right, title and interest hereby assigned, transferred and pledged or
agreed or intended so to be (collectively the "Trust Estate") to the Trustee and
its successors in said trust and to its and their assigns forever;
IN TRUST NEVERTHELESS, upon the terms herein set forth, first, for the
equal and proportionate benefit, security and protection of all present and
future Holders of the Bonds issued under and secured by this Indenture without
privilege, priority or distinction as to the lien or otherwise of any of the
Bonds over any other of the Bonds except as provided herein, second, for the
benefit and security of the Bank with respect to the Participating Bank's
obligations under the Participating Bank Agreement, and, third, for the benefit
and security of the Participating Bank with respect to the Borrower's
obligations under the Reimbursement Agreement;
PROVIDED, HOWEVER, that if the Issuer, its successors or assigns, shall
well and truly pay, or cause to be paid, the principal of the Bonds and the
interest and premium, if any, due or to become due thereon, at the times and in
the manner mentioned in the Bonds according to the true intent and meaning
thereof, or shall provide, as permitted hereby, for the payment thereof by
depositing with the Trustee the entire amount due or to become due thereon, and
shall well and truly keep, perform and observe all the covenants and conditions
pursuant to the terms of this Indenture to be kept, performed and observed by
the Issuer, and shall pay or cause to be paid to the Trustee all sums due or to
become due to it in accordance with the terms and provisions hereof, if the
Participating Bank shall pay and perform or cause to be paid and performed all
of its reimbursement and other obligations under the Participating Bank
Agreement, and if the Borrower shall pay and perform or cause to be paid and
performed all of its reimbursement and other obligations under the Reimbursement
Agreement, then, upon such final payments and subject to the provisions of
Article X, this Indenture and the rights hereby granted shall cease, determine
and be void, and the Trustee shall forthwith release, surrender and otherwise
cancel any interest it may have in the Trust Estate; otherwise this Indenture
shall be and remain in full force and effect.
THIS INDENTURE 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, including all said payments, revenues and
receipts hereby pledged, is to be dealt with and disposed of, under, upon and
subject to the terms, conditions, stipulations, covenants, agreements, trusts,
uses and
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purposes as hereinafter expressed, and the Issuer has agreed and covenanted, and
does hereby agree and covenant, with the Trustee and with the respective
Holders, from time to time, of the Bonds, or any part thereof, as follows:
(Balance of page intentionally left blank)
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ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. In this Indenture, the following terms shall
have the meanings specified in this Article, unless the context otherwise
requires:
"Act" means the Pennsylvania Economic Development Financing Law (Act
No. 102, approved August 23, 1967, P.L. 251, as amended, including the
amendments effected by Act No. 48, approved July 10, 1987, P.L. 273, and Act No.
74, approved December 17, 1993, P.L. 490). The Act is codified at 73 P.S.
(section) 371 et seq.
"Affiliate" means any Person directly or indirectly controlling,
controlled by or under common control with the Borrower as certified to the
Trustee and the Remarketing Agent by an Authorized Representative of the
Borrower. In addition, the term "Affiliate" shall also include any Person who
has guaranteed the payment of the Borrower's obligations under the Loan
Agreement or the Reimbursement Agreement.
"Alternate Letter of Credit" means an irrevocable letter of credit
authorizing drawings thereunder by the Trustee, issued by a national banking
association, a bank, a trust company or other financial institution, and
satisfying the requirements of Section 5.08.
"Authorized Representative" shall have the meaning assigned to such
term in the Loan Agreement.
"Available Moneys" means (i) proceeds of a drawing under the Letter of
Credit and (ii) any moneys paid to the Trustee and with respect to which the
Trustee has received an opinion of nationally recognized counsel experienced in
bankruptcy matters and acceptable to the Trustee and the Rating Service to the
effect that the use of such moneys to pay principal of, premium (if any) on or
interest on the Bonds, as applicable, will not constitute an avoidable transfer
under Section 547 of the United States Bankruptcy Code in the event of a
bankruptcy case under the United States Bankruptcy Code by the Issuer or by or
against the Borrower or any Affiliate, as debtor; provided that when used with
respect to payment of amounts due in respect of any Pledged Bonds or Borrower
Bonds, "Available Moneys" means any moneys held by the Trustee and available for
such payment pursuant to the terms of this Indenture except for moneys drawn
under the Letter of Credit.
"Bank" means, initially, CoreStates Bank, N.A., a national banking
association, as issuer of the Letter of Credit, and its successors and assigns
in that capacity and, in the event an Alternate Letter of Credit is outstanding,
the issuer of the Alternate Letter of Credit.
"Bond Counsel" shall mean an attorney-at-law or a firm of attorneys of
nationally recognized standing in matters pertaining to bonds issued by states
and their political subdivisions, duly admitted to the practice of law before
the highest court of any state of the United States of America.
"Bond Fund" means the fund so designated and established pursuant to
Section 5.04.
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"Bond Pledge Agreement" means the Pledge, Security and Indemnification
Agreement among the Borrower, the Bank and the Participating Bank relating to
the Bonds, as amended or supplemented from time to time.
"Bond Service" means, for any period or payable at any time, the
principal of, premium, if any, on and interest on the Bonds for that period or
payable at that time whether due at maturity or upon acceleration or redemption.
"Bondholder Tender Notice" means a written notice meeting the
requirements of Section 4.01.
"Bonds" means the $8,400,000 Federally Taxable Variable Rate Demand
Revenue Bonds (Neose Technologies, Inc. Project) Series B of 1997 of the Issuer
issued, authenticated and delivered pursuant to Section 2.01.
"Borrower" means Neose Technologies, Inc., a corporation duly organized
and validly existing under the laws of the State of Delaware, and its successors
and assigns.
"Borrower Bonds" means any Bonds of which ownership is registered in
the name of the Borrower or any Affiliate, other than Pledged Bonds.
"Borrower Purchase Account" means the special trust account so
designated and established by the Trustee pursuant to Section 4.04.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banks located in Philadelphia, Pennsylvania, Pittsburgh, Pennsylvania,
New York, New York or any other city in which the principal corporate trust
office of the Trustee or the office of the Bank at which drawing documents are
required to be presented under the Letter of Credit is located are required or
authorized to close or on which The New York Stock Exchange is closed.
"Conversion Date" means any Interest Payment Date on which the Rate
Mode of the Bonds is converted to another Rate Mode pursuant to Section 2.05.
"DTC" means The Depository Trust Company, New York, New York and its
successors and assigns.
"Eligible Investments" means
(i) Government Obligations; the Trustee, in purchasing
Government Obligations, (a) may make any such purchase subject to
agreement with the seller for repurchase by the seller at a later date,
and in such connection may accept the seller's agreement for the
payment of interest in lieu of the right to receive the interest
payable by the issuer of the securities purchased, provided that title
to the Government Obligations so purchased by the Trustee shall vest in
the Trustee, that the Trustee shall have actual or constructive
possession of such Government Obligations, and that the current market
value of such Government Obligations (or of cash or
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additional Government Obligations pledged with the Trustee as
collateral for the purpose) is at all times at least equal to the
principal and interest thereafter to become payable by the seller under
said agreement, or (b) may purchase shares of a fund whose sole assets
are of a type described in this clause (i) and such repurchase
agreements thereof;
(ii) obligations issued or guaranteed by any state or
political subdivision thereof and rated in the highest category, if
rated as short-term obligations, or not lower than the third highest
category, if rated as long term obligations, by Moody's Investors
Service, Inc. ("Moody's") or by Standard & Poor's Ratings Services, a
Division of The McGraw-Hill Companies, Inc. ("Standard & Poor's"), or
their successors; the Trustee, in purchasing obligations of the type
described in this clause (ii), may purchase shares of a fund whose sole
assets are such obligations or obligations of the type described in
clause (i) above;
(iii) commercial or finance company paper which is rated in
the highest rating category by either Moody's or Standard & Poor's; and
(iv) deposit accounts, investment agreements, bankers'
acceptances, certificates of deposit or bearer deposit notes in any
bank, trust company or savings and loan association (including without
limitation the Trustee or any bank affiliated with the Trustee)
organized under the laws of the United States of America or any state
thereof having a rating of its unsecured senior long-term debt
obligations within one of the three highest rating categories by either
Moody's or Standard & Poor's.
"Event of Default" means any of the events described as an Event of
Default in Section 7.01.
"Expiration Date" means the stated expiration date of the Letter of
Credit, as such date may be extended from time to time by the Bank.
"Extraordinary Services" and "Extraordinary Expenses" mean all services
rendered and all reasonable expenses properly incurred by the Trustee or any of
its agents under this Indenture, other than Ordinary Services and Ordinary
Expenses.
"General Account" means the account so designated which is established
pursuant to Section 5.04.
"Government Obligations" means direct obligations of, or obligations
the principal of and interest on which are unconditionally guaranteed by, the
United States of America, including obligations issued or held in book-entry
form on the books of the Department of the Treasury of the United States of
America and including a receipt, certificate or any other evidence of an
ownership interest in such obligations or in specified portions thereof (which
may consist of specified portions of interest thereon).
"Holder" means the Person in whose name a Bond is registered on the
Register.
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"Indenture" means this Trust Indenture, as amended or supplemented from
time to time.
"Interest Payment Date" means (i) with respect to Weekly Rate interest,
the first Wednesday of each calendar month, or if any such Wednesday is not a
Business Day, the immediately succeeding Business Day, and (ii) with respect to
Term Rate interest, each Semiannual Date.
"Interest Rate for Advances" means the rate per annum which is two
percentage points in excess of that interest rate announced by the Trustee in
its commercial lending capacity as its "prime rate".
"Issuer" means Montgomery County Industrial Development Authority, a
Pennsylvania body corporate and politic organized and existing under the Act.
"Issuer's Fee" means the fee of the Issuer payable pursuant to Section
4.4 of the Loan Agreement.
"Letter of Credit" means the irrevocable letter of credit issued by the
Bank to the Trustee on the date of execution and delivery of this Indenture and
any Alternate Letter of Credit, under which the Trustee is authorized, subject
to the terms and conditions thereof, to draw up to (a) an amount equal to the
principal amount of the outstanding Bonds (i) to enable the Trustee to pay the
principal amount of the Bonds when due at maturity, upon redemption or upon
acceleration and (ii) to enable the Trustee to pay the portion of the purchase
price of Bonds tendered to it and not remarketed corresponding to the principal
amount of such Bonds, plus (b) while the Bonds bear interest at a Weekly Rate,
an amount equal to interest to accrue at the Maximum Rate on the outstanding
Bonds for 46 days and, while the Bonds bear interest at a Term Rate, an amount
equal to interest to accrue at a rate not less than the Term Rate then in effect
on the outstanding Bonds for 195 days (i) to enable the Trustee to pay interest
on the Bonds when due and (ii) to enable the Trustee to pay the portion of the
purchase price of Bonds tendered to it and not remarketed corresponding to the
accrued interest on such Bonds, as the same may be amended, transferred,
reissued or extended in accordance with this Indenture, plus (c) while the Bonds
bear interest at a Term Rate, an amount equal to the premium (if any) which
would become payable on the Bonds upon mandatory redemption if such irrevocable
letter of credit or Alternate Letter of Credit were not extended beyond the
Expiration Date set forth therein.
"Letter of Credit Debt Service Account" means the account so designated
and established pursuant to Section 5.04 in the Bond Fund.
"Letter of Credit Purchase Account" means the special trust account so
designated and established pursuant to Section 4.04.
"Loan" means the loan by the Issuer to the Borrower of the proceeds of
the Bonds pursuant to Section 4.1 of the Loan Agreement in the original
principal amount of $8,400,000.
"Loan Agreement" means the Loan Agreement dated as of the date hereof
between the Issuer and the Borrower, as amended and supplemented from time to
time.
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"Loan Payments" means the amounts required to be paid by the Borrower
in repayment of the Loan pursuant to Section 4.2 of the Loan Agreement.
"Maximum Rate" means (i) with respect to Weekly Rate interest, 17% per
annum and (ii) with respect to Term Rate interest, 25% per annum.
"Nominal Term Rate Period" means, with respect to a Term Mode, a period
of two or more consecutive Semiannual Periods (expressed in years and half
years) determined pursuant to Sections 2.04 and 2.05.
"Ordinary Services" and "Ordinary Expenses" mean those services
normally rendered, and those expenses normally incurred, by a trustee under
instruments similar to this Indenture.
"Outstanding Bonds", "Bonds outstanding" or "outstanding" as applied to
Bonds mean, as of the applicable date, all Bonds which have been authenticated
and delivered, or which are being delivered by the Trustee under this Indenture,
except:
(a) Bonds cancelled or required to be cancelled upon surrender,
exchange or transfer, or cancelled or required to be cancelled
because of payment or redemption on or prior to that date
pursuant to Section 2.11;
(b) On or after any purchase date for Bonds to be purchased
pursuant to Article IV, all Undelivered Bonds (or portions of
Bonds) which are purchased on such date, provided that funds
sufficient for such purchase are on deposit with the Trustee;
(c) Bonds which are deemed paid in accordance with Article X; and
(d) Bonds in substitution for which others have been authenticated
and delivered under Section 2.10.
For purposes of approval or consent by the Holders, "outstanding Bonds," "Bonds
outstanding" or "outstanding" as applied to Bonds shall not include Bonds owned
by or on behalf of the Issuer, the Borrower or an Affiliate (unless all of the
outstanding Bonds are so owned), the Bank (unless all of the outstanding Bonds
are so owned), or the Participating Bank (unless all of the outstanding Bonds
are so owned).
"Participating Bank" means the bank, trust company, savings and loan
association or other financial institution which has entered into the
Reimbursement Agreement with the Borrower and the Participating Bank Agreement
with the Bank, and its successors and assigns. The initial Participating Bank is
Jefferson Bank.
"Participating Bank Agreement" means the Participation and
Reimbursement Agreement between the Participating Bank and the Bank relating to
the Letter of Credit and the Bonds, as amended, supplemented or replaced from
time to time.
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"Person" or words importing persons means firms, associations,
partnerships (including without limitation general and limited partnerships),
joint ventures, societies, estates, trusts, corporations, public or governmental
bodies, other legal entities and natural persons.
"Pledged Bonds" shall have the meaning assigned to such term in Section
4.05.
"Predecessor Bond" of any particular Bond means every previous Bond
evidencing all or a portion of the same debt as that evidenced by the particular
Bond. For purposes of this definition, any Bond authenticated and delivered
under Section 2.10 in substitution for a lost, wrongfully taken or destroyed
Bond shall, except as otherwise provided in Section 2.10, be deemed to evidence
the same debt as the lost, wrongfully taken or destroyed Bond.
"Project" means the acquisition, improvement and equipment of a
facility which will be used for the development and pilot production of complex
carbohydrates for research and development relating to a variety of healthcare
applications to be owned and operated by the Borrower, and located in Horsham
Township, Montgomery County, Pennsylvania, as more fully described in the Loan
Agreement.
"Project Costs" shall have the meaning assigned to such term in the
Loan Agreement.
"Project Fund" means the fund so designated and established pursuant to
Section 5.01.
"Purchase Date" means (a) with respect to any optional tender for
purchase pursuant to Section 4.01 of Bonds in the Weekly Mode, any Business Day
designated as the date of such purchase pursuant to such Section and (b) with
respect to any mandatory purchase pursuant to Section 4.02 (1) in the case of
Bonds which are to be purchased upon conversion from one Rate Mode to another
Rate Mode, the Conversion Date, or if such Conversion Date is not a Business
Day, the first Business Day succeeding such Conversion Date, (2) in the case of
Bonds which are to be purchased upon expiration of a Term Rate Period, the first
Business Day following the end of such Term Rate Period, (3) in the case of
Bonds to be purchased in anticipation of the expiration of the Letter of Credit,
the Interest Payment Date next preceding the Expiration Date of the Letter of
Credit, and (4) in the case of Bonds to be purchased at the direction of the
Bank or the Participating Bank, the purchase date stipulated by the Bank or the
Participating Bank pursuant to Section 7.03.
"Rate Mode" means the Weekly Mode or a Term Mode.
"Rating Service" means Moody's Investors Service, Inc., if the Bonds
are rated by such at the time, and Standard & Poor's Ratings Services, a
Division of The McGraw-Hill Companies, Inc., if the Bonds are rated by such at
the time, and their successors and assigns, or if either shall be dissolved or
no longer assigning credit ratings to long term debt, then any other nationally
recognized entity assigning credit ratings to long term debt designated by the
Issuer and satisfactory to the Trustee.
"Register" means the books kept and maintained by the Trustee for
registration and transfer of Bonds pursuant to Section 2.08.
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"Regular Record Date" means, while the Bonds are in the Weekly Mode,
the close of business on the last Business Day preceding an Interest Payment
Date and, while the Bonds are in the Term Mode, the close of business on the
fifteenth day of the calendar month next preceding an Interest Payment Date.
"Reimbursement Agreement" means the Reimbursement Agreement between the
Borrower and the Participating Bank relating to the Participating Bank Agreement
and the Bonds, as amended, supplemented or replaced from time to time.
"Remarketing Agent" means, initially, CoreStates Capital Markets, a
Division of CoreStates Bank, N.A. and any Person meeting the qualifications of,
and designated from time to time to act as Remarketing Agent under, Section
8.14. "Principal Office" of the Remarketing Agent means the principal office of
the Remarketing Agent at the address of the Remarketing Agent set forth in
Section 11.03, or any other office so designated in writing by the Remarketing
Agent to the Issuer, the Trustee, the Borrower, the Participating Bank and the
Bank.
"Remarketing Agreement" means the Remarketing Agreement between the
Borrower and the Remarketing Agent relating to the Bonds, as amended,
supplemented or replaced from time to time.
"Remarketing Proceeds Purchase Account" means the special trust account
so designated and established pursuant to Section 4.03.
"Revenues" means (a) the Loan Payments, (b) all other moneys received
or to be received by the Issuer or the Trustee in respect of repayment of the
Loan, including without limitation, all moneys and investments in the Bond Fund,
(c) any proceeds of Bonds originally deposited with the Trustee for the payment
of interest accrued on the Bonds or otherwise paid to the Trustee by or on
behalf of the Borrower or the Issuer for deposit in the Bond Fund or any excess
moneys remaining in the Project Fund following completion of the Project, (d)
investment income with respect to any moneys held by the Trustee under the
Indenture, and (e) any moneys paid to the Trustee under the Letter of Credit;
provided that the term "Revenues" does not include any moneys or investments in
the Remarketing Proceeds Purchase Account, the Letter of Credit Purchase Account
or the Borrower Purchase Account.
"Semiannual Date" means each March 1 and each September 1.
"Semiannual Period" means a six month period commencing on a Semiannual
Date and ending on and including the day immediately preceding the next
Semiannual Date.
"Series Issue Date" means the date of original issuance and first
authentication and delivery of the Bonds to the initial purchaser thereof
against payment therefor.
"Special Record Date" means, with respect to any Bond, the date
established by the Trustee in connection with the payment of overdue interest on
that Bond pursuant to Section 2.08.
10
"Supplemental Indenture" means any indenture supplemental to this
Indenture entered into between the Issuer and the Trustee in accordance with
Article IX.
"Term Mode" means, with respect to the Bonds, the mode of accruing
interest thereon at Term Rates based on a constant Nominal Term Rate Period.
"Term Rate" means the rate of interest borne by the Bonds for a Term
Rate Period determined pursuant to Section 2.04(a).
"Term Rate Calculation Date" means a Business Day not more than 15 days
and not less than one day prior to the first day of the corresponding Term Rate
Period.
"Term Rate Period" means a period of two or more consecutive Semiannual
Periods equal to the applicable Nominal Term Rate Period determined pursuant to
Section 2.05 commencing on the Semiannual Date immediately following the last
day of the immediately preceding Term Rate Period and running through and ending
on the day immediately preceding the Semiannual Date which follows such
commencement date by a period equal to such Nominal Term Rate Period; except
that the first Term Rate Period after conversion from a Weekly Rate to a Term
Rate shall commence on the Conversion Date of such conversion and end on and
include the day immediately preceding the Semiannual Date which follows the
Semiannual Date occurring on or immediately preceding such Conversion Date by a
period equal to such Nominal Term Rate Period.
"Term Rate Period End Interest Payment Date" means the Semiannual Date
immediately following the last day of a Term Rate Period.
"Trustee" means Dauphin Deposit Bank and Trust Company, Harrisburg,
Pennsylvania, until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter, "Trustee" shall mean
the successor Trustee. "Principal Office" of the Trustee means the principal
corporate trust office or other office of the Trustee at the address of the
Trustee set forth in Section 11.03, or any other corporate trust office so
designated in writing by the Trustee to the Issuer, the Remarketing Agent, the
Borrower, the Participating Bank and the Bank. "Delivery Office" of the Trustee
means the office, in addition to its Principal Office, at which Bondholder
Tender Notices may be delivered and where Bonds surrendered for purchase may be
delivered to the Trustee, which office may be the office of an agent of the
Trustee for such purpose and shall be designated in Section 11.03 or in a
separate writing by the Trustee to the Issuer, the Remarketing Agent, the
Borrower, the Participating Bank and the Bank.
"Trust Estate" shall have the meaning assigned to such term in the
foregoing habendum clause of this Indenture.
"Unassigned Issuer's Rights" shall have the meaning assigned to such in
the Loan Agreement.
"Undelivered Bonds" means any Bonds subject to purchase pursuant to
Section 4.01 or 4.02 which the Holder thereof has failed to deliver as described
in such Sections.
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"Weekly Mode" means, with respect to the Bonds, the mode of bearing
interest thereon at a Weekly Rate.
"Weekly Rate" means a floating weekly interest rate on the Bonds
established and adjusted in accordance with Section 2.03.
"Weekly Rate Calculation Date" means Wednesday in each calendar week
or, if any Wednesday is not a Business Day, the first Business Day preceding
such Wednesday.
"Weekly Rate Period" means the seven-day period commencing on the first
Wednesday following the corresponding Weekly Rate Calculation Date and running
through Tuesday of the following calendar week; except that (i) the first Weekly
Rate Period shall commence on the Series Issue Date and end on and include the
first Tuesday occurring after the Series Issue Date, (ii) the first Weekly Rate
Period following a conversion from a Term Mode to the Weekly Mode shall commence
on the Conversion Date for such conversion and end on and include the first
Tuesday occurring after such date, and (iii) the last Weekly Rate Period prior
to a conversion from the Weekly Mode to the Term Mode shall end on and include
the last day immediately preceding the Conversion Date for such conversion.
SECTION 1.02. Interpretation; Time of Day. Unless the context indicates
otherwise, words importing the singular number include the plural number, and
vice versa. The terms "hereof", "hereby", "herein", "hereto", "hereunder",
"hereinafter" and similar terms refer to this Indenture; and the term
"hereafter" means after, and the term "heretofore" means before, the Series
Issue Date. Words of any gender include the correlative words of the other
genders, unless the context indicates otherwise.
In this Indenture, unless otherwise indicated, all references to
particular Articles, Sections or Subsections are references to the Articles,
Sections or Subsections of this Indenture.
In this Indenture, all references to any time of the day shall refer to
Eastern standard time or Eastern daylight saving time, as in effect in the City
of Philadelphia, Pennsylvania on such day.
SECTION 1.03. Captions, Headings and Table of Contents. The captions,
headings and table of contents in this Indenture are solely for convenience of
reference and in no way define, limit or describe the scope of any Articles,
Sections, Subsections, paragraphs, subparagraphs or clauses hereof.
(End of Article I)
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ARTICLE II
AUTHORIZATION AND TERMS OF BONDS
SECTION 2.01. Amount, Form and Issuance of Bonds. The Bonds shall,
except as provided in Section 2.10, be limited to $8,400,000 in aggregate
principal amount and shall contain substantially the terms recited in the form
of Bonds set forth in Exhibit A to this Indenture. No additional series of Bonds
may be issued under this Indenture. All Bonds shall provide that Bond Service in
respect thereof shall be payable only out of the Revenues. The Issuer may cause
a copy of the text of the opinion of Bond Counsel delivered in connection with
the issuance of the Bonds to be printed on, or attached to, the Bonds, and, upon
request of the Issuer and deposit with the Trustee of an executed counterpart of
such opinion, the Trustee shall certify by manual or facsimile signature that
printed on, or attached to, the Bonds is the complete text of such opinion.
Pursuant to recommendations promulgated by the Committee on Uniform Security
Identification Procedures, "CUSIP" numbers may be printed on the Bonds. The
Bonds may bear such endorsement or legend satisfactory to the Trustee as may be
required to conform to usage or law with respect thereto.
Upon the execution and delivery hereof, the Issuer shall execute the
Bonds in the principal amount of $8,400,000 and deliver them to the Trustee for
authentication. The Trustee shall authenticate the Bonds and deliver them to, or
on the order, of the initial purchaser thereof upon receipt of a written request
and authorization to the Trustee on behalf of the Issuer, signed by an
Authorized Representative of the Issuer, and upon payment to the Trustee of the
amount specified therein, which amount shall be deposited as provided in Section
5.01.
SECTION 2.02. Designation, Denominations, Maturity, Dated Dates,
Interest Accrual and Tender.
(a) The Bonds shall be designated "Montgomery County Industrial
Development Authority Federally Taxable Variable Rate Demand Revenue Bonds
(Neose Technologies, Inc. Project) Series B of 1997" and shall be substantially
in the form attached hereto as Exhibit A.
(b) The Bonds shall be issuable in denominations of $100,000 or any
whole multiple thereof.
(c) The Bonds shall mature, subject to prior redemption as provided in
the form thereof recited in this Indenture, on March 1, 2017.
(d) The Series Issue Date shall be set forth on the face side of all
Bonds authenticated by the Trustee. Each Bond shall bear the date of its
authentication.
(e) The Bonds shall bear interest from the Interest Payment Date to
which interest has been paid next preceding the date of authentication, unless
the date of authentication (i) is an Interest Payment Date to which interest has
been paid, in which event the Bonds shall bear interest from the date of
authentication, or (ii) is prior to the first Interest Payment Date for the
Bonds, in which event such Bonds shall bear interest from the Series Issue Date.
Interest on the Bonds shall be
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paid on each Interest Payment Date. Each Bond shall bear interest on overdue
principal at the rates borne by the Bonds during the period such principal is
overdue. So long as the Bonds bear interest at a Weekly Rate, interest on the
Bonds shall be computed on the basis of a year of 365 or 366 days, as
applicable, for the number of days actually elapsed. Interest accruing on the
Bonds at a Term Rate shall be computed on the basis of a 360-day year of twelve
30-day months.
(f) Bonds authenticated and delivered while bearing interest in the
Weekly Mode shall set forth on the face side thereof, in the place provided for
designating the interest rate, the words "Weekly Rate".
(g) Bonds authenticated and delivered while bearing interest in a Term
Mode shall set forth on the face side thereof, in the place provided for
designating the interest rate, the words "__% Term Rate for Term Rate Period
ending __________".
(h) All Bonds shall initially bear interest at a Weekly Rate from the
Series Issue Date determined in accordance with Section 2.03. The Bonds may be
converted from one Rate Mode to another Rate Mode as provided in Section 2.05.
(i) The Bonds shall be subject to optional and mandatory tender for
purchase as provided in Article IV.
SECTION 2.03. Weekly Rate. A Weekly Rate shall be determined for each
Weekly Rate Period as described below. For each Weekly Rate Period and so long
as the Bonds are in the Weekly Mode, the interest rate on the Bonds shall be the
current market rate determined by the Remarketing Agent on the applicable Weekly
Rate Calculation Date, in accordance with this Section. On each Weekly Rate
Calculation Date, the Remarketing Agent shall determine the Weekly Rate as the
rate which if borne by the Bonds would, in the judgment of the Remarketing
Agent, taking into account prevailing financial market conditions, be the lowest
interest rate necessary to enable the Remarketing Agent to arrange for the sale
of all of the outstanding Bonds at a price equal to the principal amount thereof
plus accrued interest thereon. Notice of such Weekly Rate shall be given by the
Remarketing Agent to the Trustee in writing by the close of business on the
Weekly Rate Calculation Date. No notice of Weekly Rates will be given to the
Issuer, the Borrower, the Bank, the Participating Bank or the Holders; however,
the Issuer, the Borrower, the Bank, the Participating Bank and the Holders may
obtain Weekly Rates from the Trustee or the Remarketing Agent upon request
therefor. Anything herein to the contrary notwithstanding, in no event shall the
Weekly Rate borne by the Bonds exceed the Maximum Rate.
In determining each Weekly Rate to be effective pursuant to this
Section, prevailing financial market conditions which the Remarketing Agent
shall take into account shall include (i) existing short-term taxable market
rates and indexes of such short-term rates, (ii) the existing market supply and
demand for short-term taxable securities, (iii) existing yield curves for
short-term taxable securities for obligations of credit quality comparable to
the Bonds, (iv) general economic conditions, (v) industry, economic and
financial conditions that may affect or be relevant to the Bonds, and (vi) such
other facts, circumstances and conditions as the Remarketing Agent, in its sole
discretion, shall determine to be relevant.
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If for any reason the Remarketing Agent does not determine a Weekly
Rate for any Weekly Rate Period as aforesaid, or if a court holds a rate for any
Weekly Rate Period to be invalid or unenforceable, the Weekly Rate for that
Weekly Rate Period shall be equal to the Weekly Rate in effect for the
immediately preceding Weekly Rate Period. The Weekly Rate for any consecutive
succeeding Weekly Rate Period for which the Remarketing Agent does not determine
a Weekly Rate, or a court holds a rate to be invalid or unenforceable, shall be
the rate per annum equal to 115% of the interest rate per annum for 30-day
commercial paper having a rate of A-2/P-2 as reported in the Wall Street Journal
on such Weekly Rate Calculation Date.
The determination of the Weekly Rate by the Remarketing Agent pursuant
to this Indenture shall be conclusive and binding upon the Issuer, the Trustee,
the Borrower, the Remarketing Agent, the Bank, the Participating Bank and the
Holders of the Bonds.
SECTION 2.04. Term Rate.
A Term Rate shall be determined for each Term Rate Period as described
below. Upon conversion to a Term Mode, a Nominal Term Rate Period shall be fixed
by the Borrower pursuant to Section 2.05 as a term of two or more consecutive
Semiannual Periods constituting the nominal length of each Term Rate Period
thereafter until the date of a conversion to another Rate Mode. A Term Mode
based on one Nominal Term Rate Period and a Term Mode based on another Nominal
Term Rate Period are different Rate Modes. Each Term Rate shall be determined by
the Remarketing Agent, on the Term Rate Calculation Date, as the lowest rate of
interest that, in the judgment of the Remarketing Agent, taking into account
prevailing financial market conditions, would be necessary to enable the
Remarketing Agent to arrange for the sale of the Bonds in the respective Term
Mode in a secondary market sale at a price equal to the principal amount
thereof, plus accrued interest, on the first Business Day of the respective Term
Rate Period; provided that (1) if the Remarketing Agent fails for any reason to
determine the Term Rate for any Term Rate Period, such Term Rate shall be equal
to 120% of the average of the annual bond equivalent yield evaluations at par as
of the first day of the corresponding Term Rate Period or, if such day is not a
Business Day, the next preceding Business Day of United States Treasury
obligations having a term to maturity similar to such Term Rate Period, and (2)
no Term Rate shall exceed the lesser of (i) the maximum interest rate at which
the Letter of Credit, if any, then in effect provides coverage for at least 195
days interest and (ii) 25% per annum. In determining a Term Rate pursuant to
this Section, prevailing financial market conditions which the Remarketing Agent
shall take into account shall include (i) existing long-term taxable market
rates and indexes of such long-term rates, (ii) the existing market supply and
demand for long-term taxable securities, (iii) existing yield curves for
long-term taxable securities for obligations of credit quality comparable to the
Bonds, (iv) general economic conditions, (v) industry, economic and financial
conditions that may affect or be relevant to the Bonds, and (vi) such other
facts, circumstances and conditions as the Remarketing Agent, in its sole
discretion, shall determine to be relevant. Notice of each Term Rate shall
promptly be given by telephone (promptly confirmed in writing) by the
Remarketing Agent to the Trustee, the Issuer, the Borrower, the Bank and the
Participating Bank. Determinations of Term Rates pursuant to this Section shall
be conclusive and binding upon the Issuer, the Borrower, the Trustee, the Bank,
the Participating Bank and the Holders.
SECTION 2.05. Conversion at Option of Borrower. The Borrower shall have
the option to convert the Bonds from one Rate Mode to another Rate Mode as
herein provided on any
15
Conversion Date the Borrower shall select; provided that (i) each Conversion
Date shall be an Interest Payment Date and (ii) Bonds in a Term Mode cannot be
converted to another Rate Mode prior to the date on or after which the Bonds may
first be redeemed at a redemption price of par, plus accrued interest, pursuant
to their terms. The Borrower may exercise its option to convert the Bonds
regardless of the number of times the Bonds have previously been converted
pursuant to the exercise of its option to convert. The Borrower shall exercise
such option by giving written notice from an Authorized Representative of the
Borrower to the Issuer, the Trustee, the Remarketing Agent, the Bank and the
Participating Bank, stating its election to convert the Rate Mode of the Bonds
to another Rate Mode specified in such notice and stating the Conversion Date
therefor, not less than 45 days (or such shorter period as shall be acceptable
to the Trustee) prior to such Conversion Date. Upon receipt of such notice by
the Trustee, the Trustee may conclusively assume that the Issuer, the
Remarketing Agent, the Bank and the Participating Bank also received a copy of
such notice and that such condition has been complied with. In connection with
each conversion to a Term Mode, the Nominal Term Rate Period shall be selected
by the Borrower and designated in such notice. Notice of the exercise of an
option to convert shall not be effective unless, within 10 days (or such greater
period as shall be acceptable to the Trustee) of the delivery of such notice,
there shall have been delivered to the Trustee (1) an opinion of Bond Counsel
addressed to the Trustee, the Issuer, the Borrower, the Bank, the Participating
Bank and the Remarketing Agent to the effect that such conversion is authorized
or permitted by this Indenture and the Act, which opinion shall be confirmed by
such Bond Counsel on the Conversion Date, (2) written consent of the Bank and
the Participating Bank to such conversion, (3) in the case of a conversion to a
Term Mode after which a Letter of Credit will be in effect, an amendment to the
Letter of Credit or an Alternate Letter of Credit which provides for (i) an
Expiration Date not earlier than one year after the Conversion Date, (ii) on and
after such Conversion Date, coverage of 195 days accrued interest on the Bonds
at a rate not less than the interest rate at which the then current letter of
credit provides coverage, subject to adjustment on the Conversion Date to the
actual Term Rate as the same shall be fixed on the Conversion Date, and (iii) on
and after such Conversion Date, coverage of premium (if any) on the Bonds in an
amount equal to the optional redemption premium which would become payable on
the Bonds upon mandatory purchase if the Letter of Credit (as amended by such
amendment) or such Alternate Letter of Credit were not extended beyond the
Expiration Date set forth therein, (4) in the case of a conversion from a Term
Mode to the Weekly Mode an amendment to the Letter of Credit or an Alternate
Letter of Credit which provides for (i) an Expiration Date not earlier than one
year after the Conversion Date and (ii) on and after such Conversion Date,
coverage for 46 days accrued interest on the Bonds at a maximum rate of 17% per
annum, and (5) written notice from the Rating Service that such conversion and,
if applicable, the related amendment to the Letter of Credit or delivery of an
Alternate Letter of Credit will not result in a withdrawal or reduction of the
then current rating or ratings on the Bonds or setting forth a new rating or
ratings on the Bonds effective upon such conversion. In the case of a conversion
from one Rate Mode to another Rate Mode, the Trustee shall give notice by first
class mail (postage prepaid) to the Holders not less than 30 days prior to the
proposed Conversion Date stating (i) that, in the case of a conversion to a Term
Mode, the interest rate on the Bonds is scheduled to be converted to a Term Rate
and stating the Nominal Term Rate Period on which such Term Rate will be based,
or in the case of a conversion to the Weekly Mode, the interest rate on the
Bonds is scheduled to be converted to a Weekly Rate, (ii) the proposed
Conversion Date, (iii) that the Borrower, on or before the tenth day prior to
the proposed Conversion Date, may determine not to convert the Bonds in which
case the Trustee shall notify the Holders in writing to such effect, and
(iv) that all outstanding Bonds will be subject to a mandatory purchase on the
Conversion Date, or if such Conversion Date is not a Business Day, the first
Business
16
Day following such Conversion Date at a price of par plus accrued interest, if
any. The Issuer, the Borrower, the Trustee, the Bank, the Participating Bank and
the Remarketing Agent shall not be liable to any Holders for failure to give any
notice required above or for failure of any Holders to receive any such notice.
Upon each conversion under this Section, the Bonds shall be subject to mandatory
purchase pursuant to Section 4.02 on the Conversion Date or if such Conversion
Date is not a Business Day, the first Business Day following such Conversion
Date.
SECTION 2.06. Execution and Authentication of Bonds. The Bonds shall be
executed by the manual or facsimile signature of the Chairperson or Vice
Chairperson of the Issuer, and the corporate seal of the Issuer or a facsimile
thereof shall be affixed, imprinted, lithographed or reproduced thereon and
attested by the manual or facsimile signature of the Secretary or Assistant
Secretary of the Issuer. In case any officer whose signature or a facsimile of
whose signature shall appear on any Bond shall cease to be that officer before
the authentication of the Bond, the signature of such officer or the facsimile
thereof nevertheless shall be valid and sufficient for all purposes, the same as
if he had remained in office until that time. Any Bond may be executed on behalf
of the Issuer by an officer who, on the date of execution is the proper officer,
although on the date of authentication of the Bond that person was not the
proper officer.
No Bond shall be valid or become obligatory for any purpose or shall be
entitled to any security or benefit under this Indenture unless and until a
certificate of authentication, substantially in the form set forth in Exhibit A
to this Indenture, has been signed by the Trustee. The authentication by the
Trustee upon any Bond shall be conclusive evidence that the Bond so
authenticated has been duly authenticated and delivered hereunder and is
entitled to the security and benefit of this Indenture. The certificate of the
Trustee may be executed by any person authorized by the Trustee, and it shall
not be necessary that the same authorized person sign the certificates of
authentication on all of the Bonds.
SECTION 2.07. Source of Payment of Bonds. To the extent provided in and
except as otherwise permitted by this Indenture, (i) the Bonds shall be limited
obligations of the Issuer and the Bond Service thereon shall be payable equally
and ratably solely from the Revenues and (ii) the payment of Bond Service on the
Bonds shall be secured by the Trust Estate pursuant to the granting clauses of
this Indenture. Neither the general credit nor the taxing power of the County of
Montgomery, the Commonwealth of Pennsylvania or any political subdivision
thereof is pledged to the payment of the Bonds, and the Bonds shall not be or be
deemed obligations of the County of Montgomery, the Commonwealth of Pennsylvania
or any political subdivision thereof. The Issuer has no taxing power.
SECTION 2.08. Payment and Ownership of Bonds. Bond Service shall be
payable in lawful money of the United States of America without deduction for
the services of the Trustee. Subject to the provisions of the second paragraph
of this Section and Sections 2.12 and 2.13, (i) the principal of and any premium
on any Bond shall be payable when due to a Holder upon presentation and
surrender of such Bond at the Principal Office of the Trustee, and (ii) interest
on any Bond shall be paid on each Interest Payment Date by check which the
Trustee shall cause to be mailed on that date to the Person in whose name the
Bond (or one or more Predecessor Bonds) is registered at the close of business
on the Regular Record Date applicable to that Interest Payment Date on the
Register at the address appearing therein. If and to the extent, however, that
the Issuer shall fail to make payment or provision for payment of interest on
any Bond on any Interest Payment Date, that
17
interest shall cease to be payable to the Person who was the Holder of that Bond
(or of one or more Predecessor Bonds) as of the applicable Regular Record Date.
When moneys become available for payment of that interest, (x) the Trustee
shall, pursuant to Subsection 7.06(d), establish a Special Record Date for the
payment of that interest which shall be not more than 15 nor fewer than 10 days
prior to the date of the proposed payment, and (y) the Trustee shall cause
notice of the proposed payment and of the Special Record Date to be mailed by
first class mail, postage prepaid, to each Holder at its address as it appears
on the Register not fewer than 10 days prior to the Special Record Date and,
thereafter, that interest shall be payable to the Persons who are the Holders of
the Bonds (or their respective Predecessor Bonds) at the close of business on
the Special Record Date.
The interest and the principal or redemption price and purchase price
becoming due with respect to the Bonds shall, at the written request of the
Holder of at least $1,000,000 aggregate principal amount of such Bonds received
by the Trustee at least two Business Days before the corresponding Regular
Record Date or maturity, redemption or purchase date, be paid by wire transfer
within the continental United States in immediately available funds to the bank
account number of such Holder specified in such request and entered by the
Trustee on the Register, but, in the case of principal or redemption price and
purchase price, only upon presentation and surrender of such Bonds at the
Principal Office of the Trustee.
Subject to the foregoing, each Bond delivered under this Indenture upon
transfer thereof, or in exchange for or in replacement of any other Bond, shall
carry the rights to interest accrued and unpaid, and to accrue on that Bond, or
which were carried by that Bond.
Except as provided in this Section and in the first paragraph of
Section 2.10, (i) the Holder of any Bond shall be deemed and regarded as the
absolute owner thereof for all purposes of this Indenture, (ii) payment of or on
account of the Bond Service on any Bond shall be made only to or upon the order
of that Holder or its duly authorized attorney in the manner permitted by this
Indenture, and (iii) neither the Issuer nor the Trustee shall, to the extent
permitted by law, be affected by notice to the contrary. All of those payments
shall be valid and effective to satisfy and discharge the liability upon that
Bond, including without limitation the interest thereon to the extent of the
amount or amounts so paid.
SECTION 2.09. Registration, Transfer and Exchange of Bonds. All Bonds
shall be issued in fully registered form. The Bonds shall be registered upon
original issuance and upon subsequent transfer or exchange as provided in this
Indenture. The Trustee shall act as registrar and transfer agent for the Bonds.
So long as any of the Bonds remain outstanding, the Issuer will cause books for
the registration and transfer of Bonds, as provided in this Indenture, to be
maintained and kept at the Principal Office of the Trustee.
Bonds may be exchanged, at the option of their Holder, for Bonds of any
authorized denomination or denominations in an aggregate principal amount equal
to the unmatured and unredeemed principal amount of, and bearing interest at the
same rate and maturing on the same date or dates as, the Bonds being exchanged.
The exchange shall be made upon presentation and surrender of the Bonds being
exchanged at the Principal Office of the Trustee, together with an assignment
duly executed by the Holder or its duly authorized attorney in form and with
guarantee of signature satisfactory to the Trustee.
18
Any Bond may be transferred upon the Register, upon presentation and
surrender thereof at the Principal Office of the Trustee, together with an
assignment duly executed by the Holder or its duly authorized attorney in form
and with guarantee of signature satisfactory to the Trustee. Upon transfer of
any Bond, the Issuer shall execute in the name of the transferee, and the
Trustee shall authenticate and deliver, a new Bond or Bonds of any authorized
denomination or denominations in an aggregate principal amount equal to the
unmatured and unredeemed principal amount of, and bearing interest at the same
rate and maturing on the same date or dates as, the Bonds presented and
surrendered for transfer.
In all cases in which Bonds shall be exchanged or transferred
hereunder, the Issuer shall execute, and the Trustee shall authenticate and
deliver, Bonds in accordance with the provisions of this Indenture. The exchange
or transfer shall be made without charge; provided that the Issuer or the
Trustee may make a charge for every exchange or transfer of Bonds sufficient to
reimburse them for any tax or excise required to be paid with respect to the
exchange or transfer. The charge shall be paid before a new Bond is delivered.
All Bonds issued upon any transfer or exchange of Bonds shall be the
valid obligations of the Issuer, evidencing the same debt, and entitled to the
same benefits under this Indenture, as the Bonds surrendered upon transfer or
exchange. While the Bonds are in a Term Mode, the Trustee shall not be required
to exchange or transfer (i) any Bond during a period beginning at the opening of
business 15 days before the date of the mailing of a notice of redemption of
Bonds and ending at the close of business on the day of such mailing, (ii) any
Bond selected for redemption in whole or in part, or (iii) any Bond during the
period of 15 days preceding any Interest Payment Date.
In case any Bond is redeemed in part only, on or after the redemption
date and upon presentation and surrender of the Bond, the Issuer, subject to the
provisions of Sections 2.12 and 2.13, shall cause execution of, and the Trustee
shall authenticate and deliver, a new Bond or Bonds in authorized denominations
in an aggregate principal amount equal to the unmatured and unredeemed portion
of, and bearing interest at the same rate and maturing on the same date or dates
as, the Bond redeemed in part.
SECTION 2.10. Mutilated, Lost, Wrongfully Taken or Destroyed Bonds. If
any Bond is mutilated, lost, wrongfully taken or destroyed, in the absence of
written notice to the Issuer or the Trustee that a lost, wrongfully taken or
destroyed Bond has been acquired by a bona fide purchaser, the Issuer shall
execute, and the Trustee shall authenticate and deliver, a new Bond of like
date, maturity and denomination and of the same series as the Bond mutilated,
lost, wrongfully taken or destroyed; provided that (i) in the case of any
mutilated Bond, the mutilated Bond first shall be surrendered to the Trustee,
and (ii) in the case of any lost, wrongfully taken or destroyed Bond, there
first shall be furnished to the Issuer, the Borrower and the Trustee evidence of
the loss, wrongful taking or destruction satisfactory to the Trustee, together
with indemnity satisfactory to it and to the Authorized Representative of the
Issuer. The Issuer and the Trustee may charge the Holder of a mutilated, lost,
wrongfully taken or destroyed Bond their reasonable fees and expenses in
connection with their actions pursuant to this Section.
Notwithstanding the foregoing, the Trustee shall not be required to
authenticate and deliver any substitute Bond for a Bond which has been called
for redemption or which has matured or
19
is about to mature and, in any such case, the principal or redemption price and
interest then due or becoming due shall be paid by the Trustee in accordance
with the terms of the mutilated, lost, wrongfully taken or destroyed Bond
without substitution therefor.
Every substituted Bond issued pursuant to this Section shall constitute
an additional contractual obligation of the Issuer and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all
other Bonds duly issued hereunder unless the Bond alleged to have been lost,
wrongfully taken or destroyed shall be at any time enforceable by a bona fide
purchaser for value without notice. In the event the Bond alleged to have been
lost, wrongfully taken or destroyed shall be enforceable by anyone, the Issuer
may recover the substitute Bond from the Bondholder to whom it was issued or
from anyone taking under the Bondholder except a bona fide purchaser for value
without notice.
All Bonds shall be held and owned on the express condition that the
foregoing provisions of this Section are exclusive with respect to the
replacement or payment of mutilated, lost, wrongfully taken or destroyed Bonds
and, to the extent permitted by law, shall preclude any and all other rights and
remedies with respect to the replacement or payment of negotiable instruments or
other investment securities without their surrender, notwithstanding any law or
statute to the contrary now existing or hereafter enacted.
SECTION 2.11. Cancellation of Bonds. Any Bond surrendered pursuant to
this Article for the purpose of payment, redemption, retirement, exchange,
replacement or transfer shall be cancelled upon presentation and surrender
thereof to the Trustee. Bonds purchased pursuant to Section 4.01 or 4.02 shall
not be surrendered Bonds and shall be outstanding Bonds, unless otherwise
specifically provided in this Indenture.
The Borrower may deliver at any time to the Trustee for cancellation
any Bonds previously authenticated and delivered hereunder, which the Borrower
may have purchased pursuant to the provisions of this Indenture. All Bonds so
delivered shall be cancelled promptly by the Trustee. Certification of the
surrender and cancellation of any Bond shall be made to the Issuer by the
Trustee. Cancelled Bonds shall be destroyed by the Trustee by shredding or
incineration immediately after their cancellation. The Trustee shall provide
certificates describing the destruction of cancelled Bonds to the Issuer.
SECTION 2.12. Special Agreement with Holders. Notwithstanding any
provision of this Indenture or of any Bond to the contrary, the Trustee may
enter into an agreement with any Holder providing for making all payments to
that Holder of principal of and interest and any premium on that Bond or any
part thereof at a place and by a method (including wire transfer of federal
funds) other than as provided in this Indenture and in the Bond, without
presentation or surrender of the Bond, upon any conditions which shall be
satisfactory to the Trustee; provided that (i) except as otherwise provided in
Section 2.13, payment of principal shall be made only upon presentation and
surrender of the Bond and (ii) payment in any event shall be made to the Person
in whose name a Bond shall be registered on the Register, with respect to
payment of principal and premium, on the date such principal and premium is due,
and, with respect to the payment of interest, as of the applicable Regular
Record Date, Special Record Date or other date agreed upon, as the case may be.
The Trustee will furnish a copy of each such agreement upon request, to the
Issuer, the Bank, the Participating Bank and
20
the Borrower. Any payment of principal, premium or interest pursuant to such an
agreement shall constitute payment thereof pursuant to, and for all purposes of,
this Indenture.
SECTION 2.13. Book Entry System for the Bonds.
(a) Notwithstanding the foregoing provisions of this Article II, the
Bonds shall initially be issued in the form of one fully-registered bond for the
aggregate principal amount of the Bonds of each maturity, which Bonds shall be
registered in the name of Cede & Co., as nominee of DTC. Except as provided in
paragraph (g) below, all of the Bonds shall be registered in the Register in the
name of Cede & Co., as nominee of DTC; provided that if DTC shall request that
the Bonds be registered in the name of a different nominee, the Trustee shall
exchange all or any portion of the Bonds for an equal aggregate principal amount
of Bonds registered in the name of such nominee or nominees of DTC. No person
other than DTC or its nominee shall be entitled to receive from the Issuer or
the Trustee either a Bond or any other evidence of ownership of the Bonds, or
any right to receive any payment in respect thereof unless DTC or its nominee
shall transfer record ownership of all or any portion of the Bonds on the
Register in connection with discontinuing the book entry system as provided in
paragraph (g) below or otherwise.
(b) So long as any Bonds are registered in the name of DTC or any
nominee thereof, all payments of the principal or redemption price of or
interest on such Bonds shall be made to DTC or its nominee in accordance with
DTC's Operational Arrangements on the dates provided for such payments under
this Indenture. Each such payment to DTC or its nominee shall be valid and
effective to fully discharge all liability of the Issuer or the Trustee with
respect to the principal or redemption price of or interest on the Bonds to the
extent of the sum or sums so paid. In the event of the redemption of less than
all of the Bonds outstanding of any maturity, the Trustee shall not require
surrender by DTC or its nominee of the Bonds so redeemed, but DTC (or its
nominee) may retain such Bonds and make an appropriate notation on the Bond
certificate as to the amount of such partial redemption; provided that DTC shall
deliver to the Trustee, upon request, a written confirmation of such partial
redemption and thereafter the records maintained by the Trustee shall be
conclusive as to the amount of the Bonds of such maturity which have been
redeemed.
(c) The Issuer and the Trustee may treat DTC (or its nominee) as the
sole and exclusive owner of the Bonds registered in its name for the purposes of
payment of the principal or redemption price of or interest on the Bonds,
selecting the Bonds or portions thereof to be redeemed, giving any notice
permitted or required to be given to Holders under this Indenture, registering
the transfer of Bonds, obtaining any consent or other action to be taken by
Holders and for all other purposes whatsoever; and neither the Issuer nor the
Trustee shall be affected by any notice to the contrary. Neither the Issuer nor
the Trustee shall have any responsibility or obligation to any participant in
DTC, any person claiming a beneficial ownership interest in the Bonds under or
through DTC or any such participant, or any other person which is not shown on
the Register as being a Holder, with respect to (1) the Bonds, (2) the accuracy
of any records maintained by DTC or any such participant, (3) the payment by DTC
or any such participant of any amount in respect of the principal or redemption
price of or interest on the Bonds, (4) any notice which is permitted or required
to be given to Holders under this Indenture, (5) the selection by DTC or any
such participant of any person to receive payment in the event of a partial
redemption of the Bonds, and (6) any consent given or other action taken by DTC
as Holder.
21
(d) So long as any Bonds are registered in the name of DTC or any
nominee thereof, all notices required or permitted to be given to the Holders of
such Bonds under this Indenture shall be given to DTC as provided in DTC's
Operational Arrangements.
(e) In connection with any notice or other communication to be provided
to Holders pursuant to this Indenture by the Issuer or the Trustee with respect
to any consent or other action to be taken by Holders, DTC shall consider the
date of receipt of notice requesting such consent or other action as the record
date for such consent or other action, provided that the Issuer or the Trustee
may establish a special record date for such consent or other action. The Issuer
or the Trustee shall give DTC notice of such special record date not less than
15 calendar days in advance of such special record date to the extent possible.
(f) The Issuer has executed and delivered to DTC a Blanket Issuer
Letter of Representations pursuant to which the Issuer has agreed to comply with
the requirements stated in DTC's Operational Arrangements. The Trustee has also
agreed to comply with the requirements stated in DTC's Operational Arrangements
and any successor Trustee shall, prior to accepting duties under this Indenture,
agree to comply with the requirements stated in DTC's Operational Arrangements.
(g) The book-entry system for registration of the ownership of the
Bonds may be discontinued at any time if either (1) after notice to the Issuer
and the Trustee, DTC determines to resign as securities depository for the
Bonds, or (2) after notice to DTC and the Trustee, the Issuer determines that
continuation of the system of book-entry transfers through DTC (or through a
successor securities depository) is not in the best interests of the Issuer. In
either of such events (unless in the case described in clause (2) above, the
Issuer appoints a successor securities depository), the Bonds shall be delivered
in registered certificate form to such persons, and in such maturities and
principal amounts, as may be designated by DTC, but without any liability on the
part of the Issuer or the Trustee for the accuracy of such designation. Whenever
DTC requests the Issuer and the Trustee to do so, the Issuer and the Trustee
shall cooperate with DTC in taking appropriate action after reasonable notice to
arrange for another securities depository to maintain custody of certificates
evidencing the Bonds.
(h) Anything herein to the contrary notwithstanding, so long as any
Bonds are registered in the name of DTC or any nominee thereof, in connection
with any optional tender of such Bonds bearing interest at a Weekly Rate, the
beneficial owners of such Bonds are responsible for submitting the Bondholder
Tender Notice to the Remarketing Agent only.
(i) Upon remarketing of Bonds in accordance with Section 4.03 herein,
payment of the purchase price thereof shall be made to DTC and no surrender of
certificates is expected to be required. Such sales shall be made through DTC
participants (which may include the Remarketing Agent) and the new beneficial
owners of such Bonds shall not receive delivery of Bond certificates. DTC shall
transmit payment to DTC participants, and DTC participants shall transmit
payment to beneficial owners whose Bonds were purchased pursuant to a
remarketing. Neither the Issuer, the Trustee nor the Remarketing Agent is
responsible for transfers of payment to DTC participants or beneficial owners.
22
(j) The provisions of this Section 2.13 are subject to the provisions
of Article IV relating to Pledged Bonds.
(End of Article II)
23
ARTICLE III
REDEMPTION OF BONDS
SECTION 3.01. Terms of Redemption. The Bonds are subject to redemption
prior to stated maturity as follows:
(a) Extraordinary Optional Redemption. The Bonds are also subject to
redemption prior to maturity by the Issuer in the event of the exercise by the
Borrower of its option to direct that redemption upon occurrence of any of the
events described in Section 6.2 of the Loan Agreement, at any time in whole or
on any Interest Payment Date in part, in the event of damage, destruction or
condemnation of part of the Project, in each case, at a redemption price of 100%
of the principal amount redeemed plus accrued interest to the redemption date.
(b) Optional Redemption During Weekly Mode. While the Bonds are in the
Weekly Mode, the Bonds may be redeemed by the Issuer, at the direction of the
Borrower, in whole at any time or in part on any Interest Payment Date, prior to
maturity at a redemption price equal to 100% of the principal amount thereof
plus accrued interest to the redemption date.
(c) Optional Redemption During Term Mode. While the Bonds are in a Term
Mode, the Bonds shall be subject to optional redemption prior to maturity by the
Issuer, at the direction of the Borrower, on the dates and at the redemption
prices as shall be set forth in a Supplemental Indenture delivered in connection
with the conversion to a Term Mode.
The Issuer may only call Bonds for optional redemption pursuant to this
Subsection which would require a payment of a premium if (i) the Trustee can
draw under the Letter of Credit moneys sufficient to pay such premium with
respect to all Bonds other than any Pledged Bonds or Borrower Bonds and (ii) the
Participating Bank has consented to such optional redemption.
The Trustee shall only call Bonds for optional redemption if (i) it
holds moneys in the Bond Fund available for payment of the Bonds to be redeemed
pursuant to Section 5.04(c) or (ii) the Participating Bank has consented to such
optional redemption.
(d) Use of Certain Funds to Redeem Bonds. The Trustee shall draw on the
Letter of Credit in the manner provided by Section 5.04 to pay the principal of
and premium (if any) and interest on any Bonds called for redemption pursuant to
this Section. Except as otherwise provided in this Section, the Trustee shall
pay the redemption price on all Bonds redeemed under this Section in the manner
and from the sources set forth in Section 5.04 with respect to the payment of
Bond Service.
SECTION 3.02. Partial Redemption. If fewer than all of the Bonds are to
be redeemed, the selection of Bonds to be redeemed, or portions thereof in
amounts of $100,000 or any whole multiple thereof, shall be made by lot or by
such other method as the Trustee deems fair and appropriate; provided that any
Pledged Bonds shall be redeemed first and any Borrower Bonds shall be redeemed
second. In the case of a partial redemption of Bonds when Bonds of denominations
greater than $100,000 are then outstanding, each $100,000 unit of face value of
principal thereof shall be
24
treated as though it were a separate Bond of the denomination of $100,000. If it
is determined that one or more, but not all, of the $100,000 units of face value
represented by a Bond are to be called for redemption, then upon notice of
redemption of a $100,000 unit or units, the Holder of that Bond shall, subject
to Section 2.12, surrender the Bond to the Trustee (a) for payment of the
redemption price of the $100,000 unit or units of face value called for
redemption (including without limitation the interest accrued to the date fixed
for redemption and any premium) and (b) for issuance, without charge to the
Holder thereof, of a new Bond or Bonds of any authorized denomination or
denominations in an aggregate principal amount equal to the unmatured and
unredeemed portion of, and bearing interest at the same rate and maturing on the
same date as, the Bond surrendered.
SECTION 3.03. Issuer's Election to Redeem. Except in the case of
redemption pursuant to any mandatory redemption provisions of this Indenture,
Bonds shall be redeemed only by written notice from the Borrower on behalf of
the Issuer to the Trustee, the Bank and the Participating Bank. Such notice
shall specify the redemption date and the principal amount of Bonds to be
redeemed, and shall be given at least 45 days prior to the redemption date or
such shorter period as shall be acceptable to the Trustee.
SECTION 3.04. Notice of Redemption.
(a) When required to redeem Bonds under any provision of this
Indenture, or when directed to do so by the Issuer or the Borrower pursuant to
the provisions of this Indenture, the Trustee shall cause notice of the
redemption to be given not more than 60 days and not less than 15 days (30 days
if the Bonds are in a Term Mode) prior to the redemption date, by mailing copies
of such notice of redemption by first class mail, postage prepaid, to all
Holders of Bonds to be redeemed at their registered addresses, but failure to
mail any such notice or defect in the mailing thereof in respect of any Bond
shall not affect the validity of the redemption of any other Bond with respect
to which notice was properly given. Each such notice shall be dated and shall be
given in the name of the Issuer and shall state the following information:
(i) the identification numbers, as established under this
Indenture, and the CUSIP numbers, if any, of the Bonds being redeemed,
provided that any such notice shall state that no representation is
made as to the correctness of CUSIP numbers either as printed on such
Bonds or as contained in the notice of redemption and that reliance may
be placed only on the identification numbers contained in the notice or
printed on such Bonds;
(ii) any other descriptive information needed to identify
accurately the Bonds being redeemed;
(iii) in the case of partial redemption of any Bonds, the
respective principal amounts thereof to be redeemed;
(iv) the redemption date;
(v) the redemption price;
25
(vi) that on the redemption date the redemption price will
become due and payable upon each such Bond or portion thereof called
for redemption, and that interest thereon shall cease to accrue from
and after said date; and
(vii) the place where such Bonds are to be surrendered for
payment of the redemption price, which place of payment shall be the
Principal Office of the Trustee.
In addition, the Trustee shall at all reasonable times make available to any
interested party complete information as to Bonds which have been redeemed or
called for redemption.
(b) In addition to the foregoing notice, further notice of any
redemption of Bonds hereunder shall be given by the Trustee, at least two
Business Days in advance of the mailed notice to Holders, by registered or
certified mail or overnight delivery service to (i) the Rating Service and to
The Bond Buyer, or their respective successors, if any, and to (ii) Financial
Information, Inc.'s "Daily Called Bond Service", 30 Montgomery Street, 10th
Floor, Jersey City, New Jersey 07302, Attention: Editor; Kenny Information
Services' "Called Bond Service", 55 Bond Street, 28th Floor, New York, New York
10004; Moody's "Municipal and Government", 99 Church Street, 8th Floor, New
York, New York 10007, Attention: Municipal News Report; and Standard and Poor's
"Called Bond Record", 26 Broadway, 3rd Floor, New York, New York 10004; or, in
accordance with then-current guidelines of the Securities and Exchange
Commission, to such other addresses and/or such other services, as the Issuer
may designate with respect to the Bonds, or no such services, as the Issuer may
designate in a certificate of the Issuer delivered to the Trustee. So long as
the Bonds or any portion thereof are held by DTC, the Trustee shall send each
notice of redemption of the Bonds to DTC at 711 Stewart Avenue, Garden City, New
York, 11530, Attention: Call Notification Department (FAX - (516) 227-4039)) or
at such other address as may be provided in writing to the Trustee from time to
time. The foregoing notice of redemption shall be sent to DTC at least 30 days
prior to the redemption date by legible facsimile transmission, certified or
registered mail, overnight delivery service or another secure method which
enables the Trustee subsequently to verify the transmission of such notice. Such
further notice shall contain the information required in Subsection 3.04(a).
Failure to give all or any portion of such further notice shall not in any
manner defeat the effectiveness of a call for redemption if notice thereof is
given to the Holders as prescribed in Subsection 3.04(a).
(c) If at the time of mailing of notice of any optional redemption
there shall not have been deposited moneys in the Bond Fund available for
payment pursuant to Subsection 5.04(c) sufficient to redeem all the Bonds called
for redemption, such notice may state that it is conditional in that it is
subject to the deposit of the redemption moneys in the Bond Fund available for
payment pursuant to Section 5.04 not later than 12:00 noon on the redemption
date, in which case such notice shall be of no effect unless moneys are so
deposited.
SECTION 3.05. Payment of Redeemed Bonds. If (a) unconditional notice of
the redemption has been duly given or duly waived by the Holders of all Bonds
called for redemption or (b) conditional notice of redemption has been so given
or waived and Available Moneys for such redemption have been duly deposited with
the Trustee, then in either such case the Bonds called for redemption shall be
payable on the redemption date at the applicable redemption price. Payment of
the redemption price together with accrued interest shall be made by the
Trustee, out of Revenues or other
26
funds deposited for such purpose, to or upon the order of the Holders of the
Bonds called for redemption upon surrender of such Bonds, except as otherwise
provided in Section 2.13.
Upon the payment of the redemption price of Bonds being redeemed, each
check or other transfer of funds issued for such purpose shall bear the CUSIP
number identifying, by issue and maturity, the Bonds being redeemed with the
proceeds of such check or other transfer.
All moneys deposited in the Bond Fund and held by the Trustee for the
redemption of particular Bonds shall be held in trust for the account of the
Holders thereof and shall be paid to them, respectively, upon presentation and
surrender of those Bonds, except as otherwise provided in Section 2.13.
(End of Article III)
27
ARTICLE IV
PURCHASE AND REMARKETING OF BONDS
SECTION 4.01. Purchase on Demand of Holder During Weekly Mode. While
the Bonds are in the Weekly Mode, any Bond (or portion thereof in an authorized
denomination) shall be purchased on the demand of the Holder thereof on any
Business Day designated by such Holder in a Bondholder Tender Notice at a
purchase price equal to 100% of the principal amount thereof plus accrued
interest, if any, to the Purchase Date, if there is delivered to the Trustee at
its Principal Office or Delivery Office, and to the Remarketing Agent at its
Principal Office, a Bondholder Tender Notice which (i) states the principal
amount (or portion thereof) of such Bond and (ii) states the Purchase Date on
which such Bond (or portion thereof) shall be purchased pursuant to this
Section, which date shall be a Business Day not prior to the seventh day next
succeeding the date of the delivery of such notice to the Trustee and the
Remarketing Agent. By delivering the Bondholder Tender Notice, the Holder
irrevocably agrees to deliver such Bond, if not held in book-entry form, duly
endorsed for transfer in blank and with guarantee of signature satisfactory to
the Trustee, to the Principal Office or the Delivery Office of the Trustee or
any other address designated by the Trustee at or prior to 12:00 noon on the
Purchase Date specified in the Bondholder Tender Notice. The determination by
the Trustee of a Holder's compliance with the Bondholder Tender Notice and Bond
delivery requirements of this Section is in the sole discretion of the Trustee
and binding on the Borrower, the Issuer, the Remarketing Agent, the Bank, the
Participating Bank and the Holder of the Bonds. Any Bondholder Tender Notice
which the Trustee determines is not in compliance with this Section shall be of
no force or effect.
So long as the Bonds are registered to, and held in book-entry form by,
DTC or its nominee, the beneficial owner of Bonds is responsible for submitting
the Bondholder Tender Notice and shall be treated as the Holder of such Bonds
for such purpose, and such notice need only be submitted to the Remarketing
Agent.
Any election by a Holder to tender a Bond (or portion thereof) for
purchase on a Business Day in accordance with this Section shall be irrevocable
and shall be binding on the Holder making such election and on any transferee of
such Holder. Each Bondholder Tender Notice shall automatically constitute (i) an
irrevocable offer to sell the Bond (or portion thereof) to which such notice
relates on the Purchase Date at a price equal to the purchase price of such Bond
(or portion thereof), (ii) an irrevocable authorization and instruction to the
Trustee to effect transfer of such Bond (or portion thereof) upon payment of the
purchase price to the Trustee on the Purchase Date, (iii) with respect to a
tender of a portion of a Bond, an irrevocable authorization and instruction to
the Trustee to effect the exchange of such Bond in part for other Bonds in a
principal amount equal to the retained portion so as to facilitate the sale of
the tendered portion of such Bond, and (iv) an acknowledgment that such Holder
will have no further rights with respect to such Bond (or portion thereof) upon
payment of the purchase price thereof to the Trustee on the Purchase Date,
except for the right of such Holder to receive such purchase price upon
surrender of such Bond, if not held in book-entry form, to the Trustee endorsed
for transfer in blank and with guarantee of signature satisfactory to the
Trustee and that after the Purchase Date such Holder will hold such Bond as
agent for the Trustee. If the Bonds are not held in book-entry form and after
delivery to the Trustee and the Remarketing Agent of a
28
Bondholder Tender Notice in accordance with this Section, the Holder making such
election shall fail to deliver such Bond or Bonds described in the Bondholder
Tender Notice to the Trustee at its Principal Office or Delivery Office on or
before 12:00 noon on the applicable Purchase Date as required by this Section,
then the undelivered Bond or portion thereof (the "Undelivered Bond") described
in such Bondholder Tender Notice shall be deemed to have been tendered for
purchase to the Trustee and, to the extent that there shall be held by the
Trustee on or before the applicable Purchase Date an amount sufficient to pay
the purchase price thereof and available for such purpose pursuant to the terms
of this Section, such Undelivered Bond shall on such Purchase Date cease to bear
interest and no longer shall be considered to be outstanding. Moneys held by the
Trustee for the purchase of the Undelivered Bonds in accordance with the
provisions of this Section shall be held in a special separate trust account for
the Holders of such Undelivered Bonds. Such moneys shall be held by the Trustee
uninvested and without liability for interest pending delivery of such
Undelivered Bonds to the Trustee.
The Trustee shall, as to any Undelivered Bond, promptly place a stop
transfer against an appropriate amount of Bonds registered in the name of the
Holder thereof on the Register. The Trustee shall place such stop transfer
commencing with the lowest serial number Bond registered in the name of such
Holder (until stop transfers have been placed against an appropriate amount of
Bonds) until the appropriate tendered Bonds are delivered to the Trustee. Upon
such delivery, the Trustee shall make any necessary adjustments to the Register.
If the Bonds are not held in book-entry form and if for any reason a
Holder fails to deliver a tendered Bond to the Trustee on the Purchase Date, the
Issuer shall execute and the Trustee shall authenticate and deliver in
accordance with Section 4.03 a new Bond or Bonds in replacement of the
Undelivered Bond. The replacement of any such Undelivered Bond shall not be
deemed to create new indebtedness, but such Bond as is issued in replacement
shall be deemed to evidence the indebtedness previously evidenced by the
Undelivered Bond.
A Holder who gives a Bondholder Tender Notice may repurchase the Bonds
so tendered on the Purchase Date if the Remarketing Agent agrees to remarket
such Bond to such Holder, and if the Remarketing Agent agrees to remarket the
specified Bond to such Holder prior to delivery of such Bonds as set forth
above, the delivery requirement set forth above shall be waived.
Upon surrender of any Bond (which is not held in book-entry form) for
purchase in part only, the Issuer shall execute and the Trustee shall
authenticate and deliver to the Holder thereof a new Bond or Bonds of the same
maturity, of authorized denominations, in an aggregate principal amount equal to
the unpurchased portion of the Bond surrendered.
On the date set for purchase of Bonds to be purchased pursuant to this
Section and upon receipt by the Trustee of 100% of the aggregate purchase price
of such Bonds, the Trustee shall pay the purchase price of such Bonds to the
selling Holders thereof at its Principal Office or Delivery Office at or before
5:00 p.m.; provided that such Bond (if not held in book-entry form) shall have
been surrendered to the Trustee properly endorsed for transfer on such date with
all signatures guaranteed at or prior to 12:00 noon on such Purchase Date. Such
payment shall be made in immediately available funds and shall be made only with
the following funds in the following order of availability:
29
(1) moneys held in the Remarketing Proceeds Purchase Account
representing proceeds from the remarketing of such Bonds by the
Remarketing Agent to any Person other than the Issuer, the Borrower or
any Affiliate,
(2) moneys constituting Available Moneys held in the Bond Fund
and available to make such payment pursuant to Section 10.02, and
(3) proceeds from a drawing on the Letter of Credit deposited
directly into the Letter of Credit Purchase Account (provided that such
proceeds shall not be applied to purchase Pledged Bonds or Borrower
Bonds).
No purchase of Bonds pursuant to this Section shall be deemed to be a
payment or a redemption of such Bonds or any portion thereof and such purchase
will not operate to extinguish or discharge the indebtedness of such Bonds.
SECTION 4.02. Mandatory Purchase on Conversion Date and at End of Term
Rate Period; upon Expiration of Letter of Credit; and at Direction of Bank. The
Bonds shall be subject to mandatory purchase at a purchase price equal to the
principal amount thereof plus, in the case of purchases on a Purchase Date which
is not an Interest Payment Date, accrued interest thereon, and, in the case of a
mandatory purchase described in clause (b) below, a premium equal to the
optional redemption premium, if any, that would be due if the Bonds were to be
called for optional redemption pursuant to Section 3.01(c) on such purchase
date, as follows:
(a) on each Conversion Date, or if such Conversion Date is not
a Business Day, the first Business Day succeeding such Conversion Date,
and on the first Business Day immediately following the end of each
Term Rate Period;
(b) on the Interest Payment Date next preceding the Expiration
Date of the Letter of Credit unless at least 45 days (or such shorter
period as shall be acceptable to the Trustee) prior to such Interest
Payment Date the Trustee has received notice that the Letter of Credit
has been or will be extended or an Alternate Letter of Credit will be
provided pursuant to Section 5.08; and
(c) while the Bonds are in the Weekly Mode, on the Purchase
Date stipulated by the Bank or the Participating Bank pursuant to
Section 7.03 in the event the Bank or the Participating Bank directs
the Trustee pursuant to Section 7.03 to call the Bonds for mandatory
purchase pursuant to this clause.
In the case of any mandatory purchase of the Bonds pursuant to clause (b) or (c)
above, the Trustee shall cause notice of such mandatory purchase to be given not
more than 45 and not less than 15 days prior to the Purchase Date, by mailing
copies of such notice of mandatory purchase by first class mail, postage
prepaid, to all Holders of Bonds to be purchased at their registered addresses,
but failure to mail any such notice or defect in the mailing thereof in respect
of any Bond shall not affect the validity of the mandatory purchase of any other
Bond with respect to which notice was properly given. Each such notice shall be
dated and shall be given in the name of the Issuer and shall state the following
information: (i) the identification numbers, as established under this
Indenture, and the CUSIP
30
numbers, if any, of the Bonds being purchased; (ii) any other descriptive
information needed to identify accurately the Bonds; (iii) the Purchase Date;
(iv) the purchase price; (v) that on the Purchase Date the purchase price will
become due and payable upon each Bond; (vi) the place where the Bonds are to be
delivered for payment of the purchase price, which place of payment shall be the
Principal Office or Delivery Office of the Trustee; and (vii) the Holders of
Bonds subject to mandatory purchase shall be required to deliver their Bonds for
purchase to the Trustee at its Principal Office or Delivery Office prior to
12:00 noon on the corresponding Purchase Date, and any Bond not so delivered
prior to 12:00 noon on the applicable Purchase Date (an "Undelivered Bond")
shall be deemed to have been tendered to the Trustee as of such Purchase Date
and, from and after such Purchase Date, shall cease to bear interest and no
longer shall be considered to be outstanding. In the event of a failure by a
Holder to deliver such Holder's Bond on or before the applicable Purchase Date,
such Holder shall not be entitled to any payment (including any interest to
accrue subsequent to such Purchase Date) other than the purchase price for such
Undelivered Bond, such Undelivered Bond shall no longer be entitled to the
benefits of this Indenture, except for the purpose of payment of the purchase
price therefor, and such Holder shall thereafter hold such Undelivered Bond as
agent for the Trustee. If for any reason a Holder fails to deliver to the
Trustee on or before the applicable Purchase Date any Bond remarketed by the
Remarketing Agent pursuant to Section 4.02, the Issuer shall execute and the
Trustee shall authenticate and deliver to the Remarketing Agent for redelivery
to the purchaser a new Bond or Bonds in replacement of the Undelivered Bond. The
replacement of any such Undelivered Bond shall not be deemed to create new
indebtedness, but such Bond as is issued in replacement shall be deemed to
evidence the indebtedness previously evidenced by the Undelivered Bond.
On the date set for purchase of Bonds to be purchased pursuant to this
Section 4.02 and upon receipt by the Trustee of 100% of the aggregate purchase
price of such Bonds, the Trustee shall pay the purchase price of such Bonds to
the selling Holders thereof at its Principal Office or Delivery Office at or
before 5:00 p.m.; provided that such Bonds shall have been surrendered to the
Trustee properly endorsed for transfer on such date with all signatures
guaranteed at or prior to 12:00 noon on such date. Such payment shall be made in
immediately available funds and payment for Bonds purchased pursuant to this
Section shall be made only with the following funds in the following order of
availability:
(1) moneys held in the Remarketing Proceeds Purchase Account
representing proceeds from the remarketing of such Bonds by the
Remarketing Agent to any Person other than the Issuer, the Borrower or
any Affiliate;
(2) moneys constituting Available Moneys held in the Bond Fund
and available to make such payment pursuant to Section 10.02; and
(3) proceeds from a drawing on the Letter of Credit deposited
directly into the Letter of Credit Purchase Account (provided that such
proceeds shall not be applied to purchase Pledged Bonds or Borrower
Bonds).
No purchase of Bonds pursuant to this Section shall be deemed to be a
payment or a redemption of such Bonds or any portion thereof and such purchase
will not operate to extinguish or discharge the indebtedness of such Bonds.
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SECTION 4.03. Remarketing. Upon delivery of a Bondholder Tender Notice
to the Trustee and the Remarketing Agent (or to the Remarketing Agent only in
the case of Bonds held in book-entry form) pursuant to Section 4.01 and not
later than the fifth day preceding the Purchase Date for each mandatory purchase
pursuant to Section 4.02, the Remarketing Agent shall use its best efforts to
find purchasers for and arrange for the sale of the Bonds identified in the
Bondholder Tender Notice pursuant to Section 4.01 or all Bonds subject to
mandatory purchase pursuant to Section 4.02 (other than any Bonds purchased in
anticipation of the expiration of the Letter of Credit or at the direction of
the Bank or the Participating Bank) at a price equal to the principal amount
thereof plus, in the case of purchases on a Purchase Date which is not an
Interest Payment Date, accrued interest thereon, for settlement in immediately
available funds at or before 1:00 p.m. on the applicable Purchase Date. Except
as otherwise expressly provided herein, the Remarketing Agent may not remarket
to the Issuer, the Borrower or any Affiliate any Bonds to be purchased pursuant
to Section 4.01 or 4.02. In its capacity as a registered broker-dealer, the
Remarketing Agent may, but is not obligated to, acquire for its own account any
Bonds to be so purchased, but not otherwise remarketed, in which case the
Remarketing Agent shall have remarketed such Bonds to itself. The Remarketing
Agent may purchase and sell Bonds for its own account at any time.
At or before 2:00 p.m. on the Business Day preceding the Purchase Date
of Bonds to be purchased pursuant to Section 4.01 or 4.02 and remarketed
pursuant to this Section (or such other time as to which the Trustee and the
Remarketing Agent may agree), the Remarketing Agent shall give notice by
telegram, telex, telecopy or other similar communication to the Trustee of the
names, addresses and taxpayer identification numbers of the purchasers and the
denominations of Bonds to be delivered to each purchaser and, if available, the
payment instructions for regularly scheduled interest payments.
The Remarketing Agent shall, at or before 10:00 a.m. on the Purchase
Date of Bonds to be purchased pursuant to Section 4.01 or 4.02 and remarketed
pursuant to this Section, give telephonic notice, promptly confirmed in writing,
to the Trustee, the Borrower, the Bank and the Participating Bank specifying the
principal amount of Bonds remarketed and not remarketed, respectively, and the
amount representing the purchase price of Bonds which the Remarketing Agent does
not then hold in trust.
The Remarketing Agent shall cause to be paid to the Trustee in
immediately available funds by 1:00 p.m. on the Purchase Date of Bonds to be
purchased pursuant to Section 4.01 or 4.02 and remarketed pursuant to this
Section, all amounts (if any) then held by the Remarketing Agent representing
proceeds of the remarketing of such Bonds. All such remarketing proceeds
received by the Trustee shall be deposited by the Trustee in the special trust
account designated as the Remarketing Proceeds Purchase Account which the
Trustee shall establish and use as provided in this Article IV and shall not be
commingled with other funds held by the Trustee. All moneys in the Remarketing
Proceeds Purchase Account shall be held in trust, uninvested and without
liability for interest thereon, pending application of such moneys by the
Trustee pursuant to this Article.
On the Purchase Date of Bonds to be purchased pursuant to Sections 4.01
or 4.02, the Trustee shall register (or hold) all Bonds purchased on such date
as follows:
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(a) Bonds remarketed by the Remarketing Agent shall be
registered and made available (at the Principal Office or Delivery
Office of the Trustee) to the Remarketing Agent or the purchasers
thereof in accordance with the instructions of the Remarketing Agent
delivered to the Trustee pursuant to this Section 4.03; and
(b) Bonds purchased with proceeds of a drawing on the Letter
of Credit which are Pledged Bonds shall be held as Pledged Bonds in
accordance with Section 4.05.
Any Bond (or portion thereof) with respect to which the Trustee
receives a Bondholder Tender Notice pursuant to Section 4.01 on or after the
date notice of a mandatory purchase pursuant to Section 4.02 or redemption
pursuant to Section 3.04 is given and before the corresponding mandatory
Purchase Date or redemption date, respectively, shall not be remarketed except
to a buyer who receives and acknowledges the binding effect of such notice.
Bonds purchased on or after the date notice of mandatory purchase is given and
before the corresponding mandatory Purchase Date and not remarketed, shall not
be subject to mandatory purchase, but shall remain outstanding. In addition,
Bonds which are deemed paid pursuant to Article X shall not be remarketed but
shall be canceled upon being purchased pursuant to Section 4.01 or 4.02 in
accordance with the Bond cancellation provisions of Section 2.11.
Anything in this Indenture to the contrary notwithstanding, the
Remarketing Agent shall have no obligation (i) to remarket any Bonds which are
not supported by the Letter of Credit or an Alternate Letter of Credit, or (ii)
to determine Term Rates or to find purchasers for and arrange for the sale of
the Bonds on or after a Conversion Date or to make any effort to such end,
except to the extent the Remarketing Agent shall have expressly and specifically
agreed in writing with the Borrower to perform such duties.
SECTION 4.04. Drawings on Letter of Credit for Purchase of Bonds. As
provided by Section 4.03, the Remarketing Agent shall advise the Trustee of the
amounts not held by the Remarketing Agent which shall be drawn under the Letter
of Credit in order for the Trustee to make timely payments of purchase price of
Bonds from remarketing proceeds or moneys drawn under the Letter of Credit. In
the absence of such notice, the Trustee shall be deemed to have received notice
from the Remarketing Agent specifying that no portion of the purchase price of
such Bonds is held by the Remarketing Agent, in which case the Trustee shall
draw the entire amount thereof under the Letter of Credit. Prior to 11:00 a.m.
on each Purchase Date, the Trustee shall take all action necessary to draw on
the Letter of Credit in accordance with its terms, the amounts specified (or
deemed specified) for receipt by the Trustee on such Purchase Date. The Trustee
shall establish a special trust account designated as the Letter of Credit
Purchase Account into which the Trustee shall deposit and hold in trust,
uninvested and without liability for interest thereon, all such amounts (and
only such amounts) received by the Trustee from drawings on the Letter of Credit
for purchases of Bonds pending application of such amounts by the Trustee
pursuant to this Article IV. Any remaining amounts in the Letter of Credit
Purchase Account after any application required by this Article IV shall be paid
over by the Trustee to the Bank as reimbursement for the drawing on the Letter
of Credit from which such amounts were derived; provided that the Letter of
Credit shall be reinstated to the extent of such reimbursement and the Trustee
shall take all necessary action on its part pursuant to the Letter of Credit to
effect such reinstatement. Anything herein to the contrary notwithstanding, no
amounts drawn on the Letter of Credit shall be applied to the purchase of
Pledged Bonds or Borrower Bonds.
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Any moneys paid by the Borrower pursuant to Section 4.3 of the Loan
Agreement for purchase of Bonds shall be deposited by the Trustee in a special
trust account designated as the Borrower Purchase Account which the Trustee
shall establish and use to reimburse (i) the Bank for drawings under the Letter
of Credit for such purpose or (ii) the Participating Bank if it has reimbursed
the Bank for moneys so drawn and the Trustee has received written notice from
the Bank of such reimbursement.
SECTION 4.05. Bonds Purchased with Proceeds of Letter of Credit.
(a) Pledged Bonds. Bonds purchased with proceeds of a drawing on the
Letter of Credit pursuant to this Article shall constitute "Pledged Bonds" and
shall be held by the Trustee as agent for the Bank or the Participating Bank as
pledgee pursuant to the Bond Pledge Agreement (and shall be shown as such on the
Register and, if held in book-entry form, in the ownership records maintained by
DTC and any applicable DTC participant) unless and until (1) the Trustee has
confirmation from the Bank to the extent contemplated by the terms of the Letter
of Credit that the Letter of Credit has been reinstated with respect to such
drawing and (2) the Bank or the Participating Bank has notified the Trustee by
telephone (thereafter promptly confirmed in writing) that such Bonds have been
released from the pledge pursuant to the Bond Pledge Agreement and are no longer
Pledged Bonds. Pending reinstatement of the Letter of Credit and release of such
pledge as aforesaid, the Bank (or the Participating Bank, if it has reimbursed
the Bank for the corresponding drawing on the Letter of Credit for the purchase
price and the Trustee has received written notice from the Bank of such
reimbursement) shall be entitled to receive all payments of principal of and
interest on Pledged Bonds as pledgee of the Borrower and such Bonds shall not be
transferable or deliverable to any party (including the Borrower) except the
Bank or the Participating Bank pursuant to the Bond Pledge Agreement.
(b) Remarketing of Pledged Bonds. The Remarketing Agent shall continue
to use its best efforts to arrange for the sale of any Pledged Bonds required to
be remarketed pursuant to Section 4.03, subject to full reinstatement of the
Letter of Credit with respect to the drawings with which such Bonds were
purchased, at a price equal to the principal amount thereof plus accrued
interest.
(c) Notice of Remarketing. At or prior to 2:00 p.m. on the Business Day
preceding each day on which any Pledged Bonds that are successfully remarketed
by the Remarketing Agent are to be purchased, the Remarketing Agent shall give
telephonic notice, promptly confirmed in writing, to the Trustee, the Borrower,
the Bank and the Participating Bank specifying:
(1) the Business Day on which such purchase will take place
and the principal amount of Pledged Bonds successfully remarketed by
the Remarketing Agent, and
(2) to the Trustee only, the names, addresses and tax
identification numbers of the proposed purchasers thereof and the
denominations of Bonds to be delivered to each purchaser and, if
available, the payment instructions for regularly scheduled interest
payments.
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(d) Delivery of Remarketed Pledged Bonds and Proceeds Thereof.
Contemporaneously with reinstatement of the Letter of Credit as described in
Subsection 4.05(a) and the sale of Pledged Bonds arranged by the Remarketing
Agent as described in Subsection 4.05(b), (i) such Bonds (if not held in
book-entry form) shall be made available (at the Principal Office or Delivery
Office of the Trustee) to the Remarketing Agent or the purchasers thereof in
accordance with the instructions of the Remarketing Agent and (ii) the proceeds
of such sale shall be delivered to the Bank or the Participating Bank, as
appropriate, for the account of the Borrower to be applied to any unpaid
reimbursement obligation under the Participating Bank Agreement or the
Reimbursement Agreement with respect to the prior drawings made on the Letter of
Credit in respect of the purchase of such Bonds.
SECTION 4.06. Borrower Bonds.
(a) Remarketing of Borrower Bonds. Subject to the provisions and
limitations of the Remarketing Agreement and Section 4.03, the Remarketing Agent
shall, if so directed by the Borrower, use its best efforts to arrange for the
sale of any Borrower Bonds, at a price equal to the principal amount thereof,
plus accrued interest.
(b) Notice of Remarketing. On or prior to each Business Day on which
any Borrower Bonds that are successfully remarketed by the Remarketing Agent
pursuant to Section 4.06(a) are to be purchased, the Remarketing Agent shall
give telephonic notice, promptly confirmed in writing, to the Trustee, the
Borrower, the Bank and the Participating Bank specifying:
(1) the Business Day on which such purchase will take place
and the principal amount of Borrower Bonds successfully remarketed by
the Remarketing Agent, and
(2) to the Trustee only, the names, addresses and tax
identification numbers of the proposed purchasers thereof, the
denominations of Bonds to be delivered to each purchaser and, if
available, the payment instructions for regularly scheduled interest
payments.
(c) Delivery of Remarketed Borrower Bonds and Proceeds Thereof. Upon
the sale of Borrower Bonds arranged by the Remarketing Agent pursuant to Section
4.06(a), (i) such Bonds (if not held in book-entry form) shall be made available
(at the Principal Office or Delivery Office of the Trustee) to the Remarketing
Agent or the purchasers thereof in accordance with the instructions of the
Remarketing Agent and (ii) the proceeds of such sale shall be delivered to the
Borrower.
SECTION 4.07. No Purchases After Acceleration; Inadequate Funds for
Purchases. Anything in this Indenture to the contrary notwithstanding, there
shall be no purchases of Bonds pursuant to this Article if the Bonds have been
declared immediately due and payable pursuant to Section 7.03 and such
declaration has not been annulled, stayed or otherwise suspended.
If the funds available for purchases of Bonds are inadequate for the
purchase of all Bonds tendered on any Purchase Date pursuant to this Article,
the Trustee shall, after any applicable
35
grace period: (a) return all tendered Bonds to the Holders thereof; and (b)
return all moneys received for the purchase of such Bonds (other than moneys
provided by the Borrower and other than Letter of Credit proceeds, unless the
Letter of Credit is reinstated with respect thereto) to the persons providing
such moneys.
(End of Article IV)
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ARTICLE V
FUNDS AND LETTER OF CREDIT
SECTION 5.01. Creation of Project Fund. There is hereby established
with the Trustee a trust fund designated "Project Fund" for the payment of
Project Costs. There shall be deposited in the Project Fund all proceeds of the
sale of the Bonds. The Trustee shall maintain a record of the income on
investments and interest earned on amounts held in the Project Fund and on
proceeds of Bonds held in respect of accrued or capitalized interest held by the
Trustee as Revenues. Such income or interest may be expended at any time or from
time to time to pay the Project Costs in the same manner as the proceeds of
Bonds deposited in the Project Fund are expended.
Pending disbursement pursuant to the Loan Agreement, the moneys and
Eligible Investments to the credit of the Project Fund shall be held as security
for the outstanding Bonds and for the Participating Bank's obligations under the
Participating Bank Agreement and the Borrower's obligations under the
Reimbursement Agreement.
SECTION 5.02. Disbursements from and Records of Project Fund. Moneys in
the Project Fund shall be disbursed in accordance with the provisions of the
Loan Agreement. The Trustee shall cause to be kept and maintained adequate
records pertaining to the Project Fund and all disbursements therefrom. The
Trustee shall make such records available for inspection by, or shall provide
copies thereof to, the Issuer, the Borrower, the Bank and/or the Participating
Bank upon request.
SECTION 5.03. Disposition of Excess Bond Proceeds. The completion of
the Project and payment of all Project Costs payable out of the Project Fund
(except for amounts, if any, retained by the Trustee as provided under the Loan
Agreement for the payment of Project Costs not then due and payable) shall be
evidenced by the filing with the Trustee of the certificate of the Authorized
Representative of the Borrower required by Section 3.6 of the Loan Agreement. As
soon as practicable after the filing with the Trustee of such certificate, any
balance remaining in the Project Fund (other than the amounts retained by the
Trustee as described in the preceding sentence) shall be deposited or applied in
accordance with the direction of the Authorized Representative of the Borrower
pursuant to Section 3.4 of the Loan Agreement.
SECTION 5.04. Bond Fund.
(a) Revenues to be Paid Over to the Trustee. The Issuer has caused the
Revenues to be paid directly to the Trustee. If, notwithstanding these
arrangements, the Issuer receives any payments pursuant to the Loan Agreement
(other than payments to the Issuer in accordance with Section 4.4, 5.10 or 7.4
thereof), the Issuer shall immediately pay over the same to the Trustee to be
held as Revenues or otherwise applied pursuant to this Indenture. Any moneys
received by the Trustee with the written stipulation that they constitute
payments by the Borrower under Section 4.3 of the Loan Agreement corresponding
to payments of purchase price of Bonds shall be identified as such and deposited
and applied pursuant to Article IV. Except as provided in the immediately
preceding sentence and as otherwise specifically directed under the terms of
this Indenture, all Revenues received by the Trustee shall be deposited into the
General Account of the Bond Fund.
37
(b) Creation of Bond Fund and Accounts. There is hereby established
with the Trustee a trust fund designated as the "Bond Fund", within which there
shall be established a General Account and a Letter of Credit Debt Service
Account. Moneys held by the Trustee in the General Account shall be applied in
accordance with Section 5.04(c)(2) and the other provisions of this Indenture
(i) to reimburse the Bank or the Participating Bank with respect to drawings on
the Letter of Credit to pay the principal of, premium, if any, on or interest on
Bonds or (ii) to make payments of principal of, premium, if any, on and interest
on the Bonds. All moneys (and only those moneys) received by the Trustee from
drawings under the Letter of Credit to pay principal of, premium, if any, on and
interest on the Bonds shall be deposited in the Letter of Credit Debt Service
Account and applied to such purpose.
(c) Application of Bond Fund. Except as otherwise provided in Section
7.06, moneys in the Bond Fund shall be applied as follows:
(1) Moneys in the Letter of Credit Debt Service Account shall
be applied to the payment when due of principal of, premium, if any, on
and interest on the Bonds (other than Pledged Bonds or Borrower Bonds,
for which such moneys shall not be Available Moneys).
(2) Moneys in the General Account shall be applied to the
following in the order of priority indicated:
(A) the reimbursement of (i) the Bank when due for
moneys drawn under the Letter of Credit and deposited in the
Letter of Credit Debt Service Account for payment of principal
of, premium, if any, on and interest on the Bonds (in applying
moneys pursuant to this clause, the Trustee shall transfer
such moneys by wire transfer of immediately available funds)
or (ii) the Participating Bank if it has reimbursed the Bank
for moneys so drawn and the Trustee has received written
notice from the Bank of such reimbursement;
(B) when insufficient moneys have been received under
the Letter of Credit for application pursuant to Subsection
5.04(c)(1), the payment when due of principal of, premium, if
any, on and interest on the Bonds, other than Borrower Bonds
or Pledged Bonds;
(C) the payment when due of principal of, premium, if
any, on and interest on Pledged Bonds; and
(D) the payment when due of principal of, premium, if
any, on and interest on Borrower Bonds, provided that if the
Trustee shall have received written notice from the Bank or
the Participating Bank that any amounts are due and owing to
the Bank or the Participating Bank under the Participating
Bank Agreement or the Reimbursement Agreement, respectively,
such payments shall be made to the Bank or the Participating
Bank for the account of the Participating Bank and/or the
Borrower, as the case may be.
38
(d) Drawings on Letter of Credit. By 12:00 noon on the Business Day
immediately preceding each Interest Payment Date, each redemption date and the
maturity date of the Bonds, the Trustee shall present the requisite draft and
certificate for a drawing on the Letter of Credit so as to comply with the
provisions of the Letter of Credit for payment to be made in sufficient time for
the Trustee to receive the proceeds of such drawing at or before 10:00 a.m. on
such Interest Payment Date, redemption date or maturity date, as the case may
be, to pay principal of, premium, if any, on and interest on the Bonds due on
such date. In addition, the Trustee shall draw on the Letter of Credit pursuant
to its terms in accordance with and in order to satisfy the requirements of
Section 7.03. By 5:00 p.m. on each date it presents the requisite documents for
a drawing on the Letter of Credit, the Trustee shall give notice to the
Participating Bank and the Borrower by telephone, promptly confirmed in writing,
of the amount so drawn. The Trustee shall promptly notify the Borrower and the
Participating Bank by oral or telephonic communication confirmed in writing if
the Bank fails to transfer funds in accordance with the Letter of Credit upon
the presentment of the requisite draft and certificate. In calculating the
amount to be drawn on the Letter of Credit for the payment of principal of and
interest on the Bonds, whether on an Interest Payment Date, at maturity or upon
redemption or acceleration, the Trustee shall not take into account the
potential receipt of funds from the Borrower under the Loan Agreement on such
Interest Payment Date, or the existence of any other moneys in the Bond Fund,
but shall draw on the Letter of Credit for the full amount of principal and
interest coming due on the Bonds.
(e) Payment in Full. Whenever the amount in the Bond Fund available for
the payment of principal or redemption price and interest in accordance with
Subsection 5.04(c) is sufficient to redeem all of the outstanding Bonds and to
pay interest accrued to the redemption date, the Issuer will, upon request of
the Borrower, cause the Trustee to redeem all such Bonds on the redemption date
specified by the Borrower pursuant to the Bonds and the Indenture. Any amounts
remaining in the Bond Fund after payment in full of the principal of and
premium, if any, and interest on the Bonds (or provision for payment thereof)
and the fees, charges and expenses of the Issuer and the Trustee shall be paid
to the person entitled thereto in accordance with Section 10.01.
(f) Credits. If at any time the Trustee has funds, including funds
received pursuant to the Letter of Credit, which under the provisions of this
Indenture are to be applied to pay the principal of, premium, if any, on or
interest on the Bonds, the Borrower, to the extent that such funds are to be so
applied, shall be entitled to a credit, equal to the amount of such funds,
against payments due from the Borrower under the Loan Agreement; provided that,
with respect to funds received pursuant to one or more drawings on the Letter of
Credit, the Bank and the Participating Bank have been reimbursed therefor.
SECTION 5.05. Investment of Bond Fund and Project Fund. All moneys
received by the Trustee under this Indenture shall be deposited with the
Trustee, until or unless invested or deposited as provided in this Section. All
deposits with the Trustee (whether original deposits or deposits or redeposits
in time accounts) shall be secured as required by applicable law for such trust
deposits.
Moneys in the Bond Fund (except moneys in the Letter of Credit Debt
Service Account and except any moneys representing principal of, or premium, if
any, or interest on, any Bonds which are deemed paid under Section 10.02) and
the Project Fund shall be invested and reinvested by the
39
Trustee in Eligible Investments at the written direction of an Authorized
Representative of the Borrower. Except as otherwise provided in Section 10.02,
moneys deposited in the Letter of Credit Debt Service Account, the Letter of
Credit Purchase Account or the Remarketing Proceeds Purchase Account shall not
be invested but shall be held in their respective accounts pending application
pursuant to Section 5.04 or Article IV, as applicable. Moneys in the Bond Fund
representing principal of, or premium, if any, or interest on, any Bonds which
are deemed paid under Section 10.02 shall be invested only if and as provided in
Section 10.02.
Investments pursuant to this Section of moneys in the Bond Fund shall
mature or be redeemable at the direction of the Borrower at the times and in the
amounts necessary to provide moneys to make Bond Service payments as they become
due on Interest Payment Dates, at stated maturity or by redemption, or to
reimburse the Bank or the Participating Bank when due with respect to drawings
on the Letter of Credit applied to make Bond Service payments. The Trustee shall
sell or redeem investments credited to the Bond Fund to produce sufficient
moneys available hereunder at the times required for the purpose of paying Bond
Service (or reimbursing the Bank or the Participating Bank with respect to
drawings on the Letter of Credit therefor) when due as aforesaid, and shall do
so without necessity for any order by or on behalf of the Issuer or the Borrower
and without restriction by reason of any order. Each investment of moneys in the
Project Fund shall mature or be redeemable by the Trustee at the direction of
the Borrower at such time as may be foreseeably necessary to make payments from
the Project Fund. Subject to any directions from an Authorized Representative of
the Borrower with respect thereto, the Trustee may, from time to time, sell
investments in the Project Fund or the Bond Fund made pursuant to this Section
and reinvest the proceeds therefrom in Eligible Investments maturing or
redeemable as aforesaid.
Any investment of moneys in any Fund established under this Indenture
may be purchased from or through, or sold to, the Trustee or any affiliate of
the Trustee; and any such investment made through the purchase of shares of a
fund described in clause (i) or (ii) of the definition of Eligible Investments
may be in a fund which is advised or administered by the Trustee or any
affiliate of the Trustee (for which services the Trustee or such affiliate, as
the case may be, may receive a fee).
An investment made from moneys credited to the Bond Fund or the Project
Fund shall constitute part of that respective Fund, and each respective Fund
shall be credited with all proceeds of sale and income from investment of moneys
credited thereto. For purposes of this Indenture, those investments shall be
valued at face amount or market value, whichever is less.
If the Borrower shall not give directions as to investments of moneys
held by the Trustee in the Project Fund or the Bond Fund, or if an Event of
Default has occurred and is continuing hereunder, the Trustee shall make such
investments in Eligible Investments as described in this Section and as
permitted under applicable law as it deems advisable; provided that in no event
shall it invest in securities issued by or obligations of, or guaranteed by, the
Issuer, the Borrower or any Affiliate.
SECTION 5.06. Bond Fund Moneys to be Held in Trust. Revenues and
investments thereof in the Bond Fund shall, until applied as provided in this
Indenture, be held by the Trustee for the benefit of the Holders of all
outstanding Bonds and the Bank and the Participating Bank in the order of
priority set forth in the granting clauses of this Indenture, except that any
portion of the
40
Revenues representing principal of, and premium, if any, and interest on, any
Bonds which have matured or been called for redemption in accordance with
Article III or which are otherwise deemed paid under Section 10.02, shall be
held for the benefit of the Holders of such Bonds only.
SECTION 5.07. Nonpresentment of Bonds. In the event that any Bond shall
not be presented for payment when the principal thereof becomes due in whole or
in part, either at stated maturity or by redemption, or a check for interest is
uncashed, all liability of the Issuer to that Holder for such Bond or such check
thereupon shall cease and be discharged completely; provided that moneys
sufficient to pay the principal and accrued interest then due of that Bond or
such check shall have been made available to the Trustee for the benefit of its
Holder. Thereupon, it shall be the duty of the Trustee to hold those moneys
subject to the provisions of Section 10.03.
SECTION 5.08. Letter of Credit.
(a) Expiration. The Letter of Credit may provide that it expires upon
the earliest to occur of (i) the Expiration Date, (ii) the date when the Trustee
surrenders the Letter of Credit to the Bank for cancellation, (iii) the date on
which the Bank receives a certificate from the Trustee to the effect that there
are no outstanding Bonds or that the Trustee has accepted an Alternate Letter of
Credit, or (iv) the date on which the final drawing available under the Letter
of Credit is honored by the Bank.
(b) Extension or Replacement in Anticipation of Expiration. At least 45
days (or such shorter period as shall be acceptable to the Trustee) prior to the
Interest Payment Date next preceding the Expiration Date of the current Letter
of Credit, the Borrower may provide for the delivery to the Trustee of (1) an
amendment to the Letter of Credit which extends the Expiration Date to a date
that is not earlier than six months from its then current Expiration Date and
that follows an Interest Payment Date by not less than two Business Days and not
more than 15 calendar days or (2) an Alternate Letter of Credit issued by a
national banking association, a bank, a trust company or other financial
institution or credit provider, which shall have terms which are the same in all
material respects (except Expiration Date and except any changes pursuant to
this Indenture with respect to interest or premium coverage in connection with a
concurrent interest rate reset or conversion) as the current Letter of Credit
and which shall have an Expiration Date that is not earlier than one year from
the Expiration Date of the Letter of Credit then in effect and that follows an
Interest Payment Date by not less than two Business Days and not more than 15
calendar days. The Borrower shall be deemed to have provided for such amendment
extending the Letter of Credit or for such Alternate Letter of Credit if the
Borrower shall have delivered to the Trustee, in form satisfactory to the
Trustee, a commitment from the Bank or the proposed provider of the Alternate
Letter of Credit to deliver such amendment or Alternate Letter of Credit on or
before the Interest Payment Date next preceding the current Expiration Date of
the Letter of Credit; provided that if such amendment or Alternate Letter of
Credit is not delivered to the Trustee on or before such Interest Payment Date,
an Event of Default shall be deemed to have occurred under Subsection 7.01(h).
Any such amended Letter of Credit or Alternate Letter of Credit shall provide
for drawings to pay up to (i) while the Bonds are in the Weekly Mode, an amount
equal to the principal amount of the outstanding Bonds, plus 46 days interest
thereon computed at 17% per annum based on a 365-day year, and (ii) while the
Bonds are in a Term Mode, an amount equal to the principal amount of the
outstanding Bonds, plus 195 days interest thereon at a rate not less than the
applicable Term Rate based on a 360-day year, plus an amount equal to the
premium (if any) which
41
would become payable on the Bonds upon mandatory purchase if such amended Letter
of Credit or Alternate Letter of Credit were not extended beyond the Expiration
Date set forth therein. The institution issuing the Alternate Letter of Credit
must be such as to maintain a rating on the Bonds equal to or higher than the
then current rating on the Bonds given by the Rating Service, and the Trustee
shall have received, on or before the date of delivery of the Alternate Letter
of Credit, written notice from the Rating Service that the issuance of the
Alternate Letter of Credit and substitution thereof for the then current Letter
of Credit will result in a rating on the Bonds equal to or higher than the then
current rating on the Bonds. The Trustee shall not accept an Alternate Letter of
Credit under this Subsection unless there shall have been delivered to the
Trustee (1) a written notice from the Rating Service as provided in the
immediately preceding sentence and (2) an opinion of counsel to the Bank
satisfactory to the Trustee with respect to the validity, binding effect and
enforceability of such Alternate Letter of Credit. If the Letter of Credit is so
extended or if an Alternate Letter of Credit complying with the requirements of
this Subsection is so provided, the mandatory purchase pursuant to clause (b) of
Section 4.02, shall not occur. Unless all of the conditions of this Subsection
which are required to be met 45 days (or such shorter period as shall be
acceptable to the Trustee) preceding the Interest Payment Date next preceding
the Expiration Date of the Letter of Credit have been satisfied, the Trustee
shall take all action necessary to call the Bonds for mandatory purchase
pursuant to clause (b) of Section 4.02, on the Interest Payment Date next
preceding such Expiration Date; provided that if the Borrower shall have
notified the Trustee in writing that it expects to meet all the conditions for
the delivery of an amendment extending the existing Letter of credit, or the
delivery of an Alternate Letter of Credit from a bank identified in such notice,
meeting all of the requirements of this Subsection on or before the Interest
Payment Date next preceding the Expiration Date of the existing Letter of
Credit, then the notice of mandatory purchase pursuant to clause (b) of Section
4.02, shall state that it is subject to rescission, and the Trustee shall
rescind such notice, if such conditions are so met (in which case such mandatory
purchase shall not occur). The provisions of this Subsection with respect to the
substitution of an Alternate Letter of Credit in the event that the Expiration
Date of the Letter of Credit is not extended shall apply equally to the
substitution of another Alternate Letter of Credit in the event that the
Expiration Date of an existing Alternate Letter of Credit is not extended.
(c) Other Replacement. The delivery of an Alternate Letter of Credit in
anticipation of the expiration of the current Letter of Credit shall be governed
by Subsection 5.08(b). Otherwise, if at any time the Borrower shall provide for
the delivery to the Trustee of (1) an Alternate Letter of Credit which shall
have terms which are the same in all material respects (except as to Expiration
Date and except any changes pursuant to this Indenture with respect to interest
or premium coverage in connection with a concurrent interest rate reset or
conversion) as the current Letter of Credit, which shall have an Expiration Date
that is not less than one year from the date of its delivery and not sooner than
the Expiration Date of the current Letter of Credit then in effect and that
follows an Interest Payment Date by not less than two Business Days and not more
than 15 calendar days and which shall be issued by a national banking
association, a bank, a trust company or other financial institution or credit
provider, and (2) an opinion of counsel to the Bank satisfactory to the Trustee
with respect to the validity, binding effect and enforceability of such
Alternate Letter of Credit, and if the requirements set forth in this Subsection
are met, then the Trustee shall accept such Alternate Letter of Credit and
promptly surrender for cancellation the previously held Letter of Credit to the
issuer thereof in accordance with the terms of such Letter of Credit. Any
Alternate Letter of Credit shall provide for drawings to pay up to (i) while the
Bonds are in the Weekly Mode, an amount equal to the principal amount of the
outstanding Bonds, plus 46 days interest thereon computed at 17% per annum based
on a
42
365-day year, and (ii) while the Bonds are in a Term Mode, an amount equal to
the principal amount of the outstanding Bonds, plus 195 days interest thereon at
a rate not less than the applicable Term Rate based on a 360-day year, plus an
amount equal to the premium (if any) which would become payable upon the Bonds
upon mandatory purchase if such Alternate Letter of Credit were not extended
beyond the Expiration Date set forth therein. The institution issuing the
Alternate Letter of Credit must be such as to maintain a rating on the Bonds
equal to or higher than the then current rating on the Bonds given by the Rating
Service. The replacement of the Letter of Credit by the Alternate Letter of
Credit must not, by itself, adversely affect the current rating or ratings on
the Bonds, and the absence of such an adverse effect shall be evidenced in
writing by the Rating Service to the Trustee at or prior to such replacement.
(d) Notice to Holders. While the Bonds are in the Weekly Mode, the
Trustee shall give notice to the Holders, in the name of the Issuer, of the
proposed replacement of the current Letter of Credit with an Alternate Letter of
Credit, which notice shall specify (i) the proposed replacement date and (ii)
the last dates prior to such proposed replacement on which Bondholder Tender
Notices must be delivered and Bonds must be delivered (if not held in book-entry
form) for the purchase of Bonds pursuant to Section 4.01 and the places where
such Bondholder Tender Notices and Bonds must be delivered for such purchase.
Such notice shall be given by first class mail, postage prepaid, not less than
30 days prior to the Interest Payment Date next preceding the proposed
replacement date.
(e) Reduction. In each case that Bonds are redeemed or deemed to have
been paid pursuant to Section 10.01, the Trustee shall take such action as may
be permitted under the Letter of Credit to reduce the amount available
thereunder to an amount equal to the principal amount of the outstanding Bonds,
plus (i) while the Bonds are in the Weekly Mode, 46 days interest on such
principal amount computed at 17% per annum based on a 365-day year, and (ii)
while the Bonds are in Term Mode, 195 days interest on such principal amount
computed at a rate not less than the applicable Term Rate based on a 360-day
year; provided that such action by the Trustee shall not be required if the
Letter of Credit so reduces automatically pursuant to its terms.
(f) Substitution by Bank. Upon reduction of the amount available under
the Letter of Credit pursuant to the terms of the Letter of Credit and
Subsection 5.08(e) as a result of redemption of Bonds, the Bank shall have the
right, at its option, to require the Trustee to promptly surrender the
outstanding Letter of Credit to the Bank and to accept in substitution therefor
a substitute Letter of Credit in the same form, dated the date of such
substitution, for an amount equal to the amount available under the Letter of
Credit as so reduced, but otherwise having terms identical to the then
outstanding Letter of Credit.
(g) Replacement of Participating Bank. Subject to the approval and
consent of the Bank and the delivery of a replacement Participating Bank
Agreement and related documentation satisfactory to the Bank, the Borrower shall
have the right to replace the Participating Bank. The Borrower shall give at
least 30 days notice to the Trustee, the Issuer and the Remarketing Agent of the
Borrower's intent to replace the Participating Bank (which notice shall identify
the proposed replacement Participating Bank), and shall provide to the Trustee
and the Issuer, on or before the
43
effective date of such replacement, complete copies of the replacement
Participating Bank Agreement, the replacement Reimbursement Agreement and such
related documentation as the Trustee or the Issuer may reasonably request. The
Trustee shall give prompt notice of any such replacement to the Holders.
(h) Other Credit Enhancement; No Credit Enhancement. After a mandatory
purchase of the Bonds pursuant to clause (b) or (c) of Section 4.02, nothing in
this Section shall limit the Borrower's right to provide other credit
enhancement (such as a letter of credit not meeting the requirements of this
Section or bond insurance) or no credit enhancement as security for the Bonds;
provided that any such credit enhancement shall have administrative provisions
reasonably satisfactory to the Trustee.
(End of Article V)
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ARTICLE VI
COVENANTS AND REPRESENTATIONS
OF ISSUER
SECTION 6.01. Corporate Existence; Compliance with Laws. The Issuer
shall maintain its corporate existence; shall use its best efforts to maintain
and renew all its rights, powers, privileges and franchises; and shall comply
with all valid and applicable laws, rules, regulations, orders, requirements and
directions of any legislative, executive, administrative or judicial body
relating to the Issuer's participation in the Project or the issuance of the
Bonds.
SECTION 6.02. Payment of Bond Service. The Issuer will pay all Bond
Service, or cause it to be paid, solely from the sources provided herein, on the
dates, at the places and in the manner provided in this Indenture.
SECTION 6.03. No Further Assignment of Revenues. The Issuer will not
assign the Revenues or create any debt, lien or charge thereon, other than the
assignment thereof under this Indenture.
SECTION 6.04. Filings. The Issuer shall cause this Indenture or
financing statements relating hereto to be filed, in such manner and at such
places as may be required by law fully to protect the security of the Holders
and the right, title and interest of the Trustee in and to the Trust Estate or
any part thereof, all as may be reasonably requested by the Trustee. From time
to time, the Trustee may, but shall not be required to, obtain an opinion of
counsel setting forth what, if any, actions by the Issuer or Trustee should be
taken to preserve such security. The Issuer shall execute or cause to be
executed any and all further instruments as shall reasonably be requested by the
Trustee for such protection of the interests of the Holders, and shall furnish
satisfactory evidence to the Trustee of filing and refiling of such instruments
and of every additional instrument which shall be necessary to preserve the lien
of this Indenture upon the Trust Estate or any part thereof until the principal
of and interest on the Bonds issued hereunder shall have been paid. The Trustee
shall execute or join in the execution of any such further or additional
instrument and file or join in the filing thereof at such time or times and in
such place or places as it may be advised by an opinion of counsel will preserve
the lien of this Indenture upon the Trust Estate or any part thereof until the
aforesaid principal and interest shall have been paid.
SECTION 6.05. Rights and Enforcement of Agreement. The Trustee may
enforce, in its name or in the name of the Issuer, all rights of the Issuer for
and on behalf of the Holders, except for Unassigned Issuer's Rights, and may
enforce all covenants, agreements and obligations of the Borrower under and
pursuant to the Loan Agreement, regardless of whether the Issuer is in default
in the pursuit or enforcement of those rights, covenants, agreements or
obligations. The Issuer will take all actions within its authority to keep the
Loan Agreement in effect in accordance with the terms thereof. So long as no
Event of Default hereunder shall have occurred and be continuing, the Issuer may
exercise all its rights under the Loan Agreement, including the right to amend
the same pursuant to the provisions thereof and hereof. The Issuer shall give
prompt notice to the Trustee of any default known to the Issuer under the Loan
Agreement.
45
SECTION 6.06. Further Assurances. Except to the extent otherwise
provided in this Indenture, the Issuer shall not enter into any contract or take
any action by which the rights of the Trustee or the Holders may be impaired and
shall, from time to time, execute and deliver such further instruments and take
such further action as may be required to carry out the purposes of this
Indenture.
SECTION 6.07. Observance and Performance Agreements. The Issuer will
observe and perform faithfully at all times covenants, agreements, authority,
actions, undertakings, stipulations and provisions to be observed or performed
on its part under the Loan Agreement, this Indenture and the Bonds, and under
all proceedings of the Issuer pertaining thereto.
SECTION 6.08. Representations and Warranties. The Issuer represents and
warrants that:
(a) It is duly authorized by the laws of the Commonwealth of
Pennsylvania, including the Act, to issue the Bonds, to execute and
deliver this Indenture and the Loan Agreement and to provide the
security for payment of the Bond Service in the manner and to the
extent set forth in this Indenture.
(b) All actions required on its part to be performed for the
issuance, sale and delivery of the Bonds and for the execution and
delivery of this Indenture and the Loan Agreement have been or will be
taken duly and effectively.
(c) The Bonds will be valid and binding limited obligations of
the Issuer according to their terms.
(End of Article VI)
46
ARTICLE VII
DEFAULT AND REMEDIES
SECTION 7.01. Defaults; Events of Default. The occurrence of any of the
following events is defined as and declared to be and to constitute an Event of
Default hereunder:
(a) Failure to pay the principal of or any premium on any Bond
when such principal or premium shall become due and payable, whether at
stated maturity, by redemption, by acceleration or otherwise;
(b) Failure to pay any interest on any Bond within three
Business Days of when such interest shall become due and payable;
(c) Failure to pay the purchase price due to the Holder of any
Bond who has tendered such Bond for purchase pursuant to Article IV
within three Business Days of when such purchase price shall have
become due and payable;
(d) Failure by the Issuer to comply with the provisions of the
Act relating to the Bonds or the Project or to observe or perform any
other covenant, agreement or obligation on its part to be observed or
performed and which is contained in this Indenture or in the Bonds,
which failure shall have continued for a period of 90 days after
written notice, by registered or certified mail, to the Issuer, the
Bank, the Participating Bank and the Borrower specifying the failure
and requiring that it be remedied, which notice may be given by the
Trustee in its discretion and shall be given by the Trustee at the
written request of the Holders of not less than 25% in aggregate
principal amount of Bonds outstanding;
(e) The occurrence and continuance of an Event of Default as
defined in Section 7.1 of the Loan Agreement;
(f) Receipt by the Trustee of a written notice from the Bank
stating that an event of default has occurred under the Participating
Bank Agreement, or from the Participating Bank stating that an event of
default has occurred under the Reimbursement Agreement, and directing
the Trustee to call the Bonds for mandatory purchase or to declare the
principal of the outstanding Bonds immediately due and payable (in the
case of conflicting notices from the Bank and the Participating Bank
under this Subsection, the notice from the Bank shall control);
(g) Receipt by the Trustee of a written notice from the Bank,
prior to the third Business Day following payment of a drawing under
the Letter of Credit for interest on Bonds which remain outstanding
after the application of the proceeds of such drawing, stating that the
Letter of Credit will not be reinstated with respect to such interest;
(h) Failure by the Borrower to cause an amendment extending
the Expiration Date of the current Letter of Credit or an Alternate
Letter of Credit to be delivered to the Trustee pursuant to Subsection
5.08(b) on or before the Interest Payment Date next
47
preceding such Expiration Date, unless the Bonds have been called for
mandatory purchase on such Interest Payment Date pursuant to clause (b)
of Section 4.02;
(i) Wrongful dishonor by the Bank of a proper drawing under
the Letter of Credit; or
(j) A decree or order of a court or agency or supervisory
authority, having jurisdiction in the premises, for the appointment of
a conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or with respect to the Bank, or for the winding-up or liquidation of
its affairs, shall have been entered against the Bank, or the Bank
shall have consented to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or with respect to the
Bank or all or substantially all of its property.
The term "default" or "failure" as used in this Article means a default
or failure by the Issuer in the observance or performance of any of the
covenants, agreements or obligations on its part to be observed or performed
contained in this Indenture or in the Bonds or a default or failure by the
Borrower under the Loan Agreement, exclusive of any period of grace or notice
required to constitute an Event of Default as provided above or in the Loan
Agreement.
SECTION 7.02. Notice of Default. If an Event of Default shall occur,
the Trustee shall give written notice of the Event of Default, by registered or
certified mail, to the Issuer, the Borrower, the Bank, the Participating Bank
and the Remarketing Agent within five (5) days after the Trustee acquires actual
knowledge of the Event of Default. If an Event of Default occurs of which the
Trustee has notice pursuant to this Indenture, the Trustee shall give written
notice thereof, within 30 days after the Trustee's receipt of notice of its
occurrence, to the Holders of all Bonds outstanding as shown by the Register at
the close of business 15 days prior to the mailing of that notice; provided that
except in the case of a default in the payment of the principal of or any
premium or interest on any Bond, the Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive committee or
a trust committee of directors or responsible officers of the Trustee in good
faith determine that the withholding of notice to the Holders is in the best
interests of the Holders.
SECTION 7.03. Acceleration. Upon the occurrence of any Event of Default
under Subsection 7.01(d), (e) or (f), the Trustee shall, upon the written
direction of the Bank or the Participating Bank (or, in the case of an Event of
Default under Subsection 7.01(d), upon the written request of 100% of the
Holders of the outstanding Bonds), declare, by a notice in writing delivered to
the Issuer and the Borrower, the principal of all Bonds outstanding (if not then
already due and payable), together with interest accrued thereon, to be due and
payable immediately; provided that, if the Bonds are in the Weekly Mode and the
Bank has not notified the Trustee that the Letter of Credit will not be
reinstated with respect to an interest drawing thereunder, the Bank or the
Participating Bank may, at its option, but subject to the following sentence,
direct the Trustee in writing to call (in which case the Trustee shall call) the
Bonds for mandatory purchase pursuant to clause (c) of Section 4.02 on a
Business Day stipulated by the Bank or the Participating Bank in such direction,
which Business Day shall not be earlier than 20 days (or such shorter period as
shall be acceptable to the Trustee) after the date the Trustee receives such
direction. Irrespective of whether an Event of Default has occurred
48
under Section 7.01(f) for which the Bank or the Participating Bank has directed
the Trustee to call the Bonds for mandatory purchase, upon receipt by the
Trustee of notice from the Bank that the Letter of Credit will not be reinstated
with respect to an interest drawing thereunder as described in Subsection
7.01(g) or upon the occurrence of an Event of Default under Subsection 7.01(h),
(i) or (j) the Trustee shall, and upon the occurrence of an Event of Default
under Subsection 7.01(a), (b) or (c) the Trustee may, declare the principal of
all Bonds outstanding (if not then already due and payable), and the interest
accrued thereon, to be due and payable immediately, such declaration to be made
by a notice in writing delivered to the Issuer and the Borrower. Upon any
declaration that the principal of and interest on the Bonds are due and payable
immediately, such principal and interest shall become and be due and payable
immediately, and, in addition, in the case of any such declaration as a result
of an Event of Default under Subsection 7.01(e), (f), (g) or (h) while the Bonds
are in a Term Mode, there shall also become due and payable immediately a
premium equal to the premium which would become payable with respect to the
Bonds if they were purchased pursuant to a mandatory purchase under Subsection
4.02(b) on the Interest Payment Date next preceding the Expiration Date of the
Letter of Credit. The exercise by the Bank or the Participating Bank of the
option to direct a mandatory purchase of the Bonds as described in Section
7.01(f) shall not preclude the Bank from later delivering to the Trustee a
notice of nonreinstatement of the Letter of Credit pursuant to Section 7.01(g).
In the case of conflicting directions from the Bank and the Participating Bank
with respect to the provisions of this Article, the directions from the Bank
shall control.
Written notice of any such declaration shall be given concurrently to
the Bank, the Participating Bank and the Remarketing Agent. The Trustee
immediately upon such declaration shall give notice thereof in the same manner
as provided in Section 3.04 with respect to redemption of the Bonds, except that
there shall be no minimum period of notice prior to the date of payment. Such
notice shall specify the date on which payment of principal and interest shall
be tendered to the Holders of the Bonds.
Upon any such declaration hereunder, the Trustee shall (i) immediately
exercise such rights as it may have under the Loan Agreement to declare all
payments thereunder to be immediately due and payable and (ii) immediately draw
upon the Letter of Credit to the full extent permitted by the terms thereof
(such drawing to provide for payment by the Bank to be due at the earliest time
which the Trustee may require under the Letter of Credit and in no case later
than six days after the date of declaration of acceleration and to include
amounts in respect of interest accruing on the Bonds through the date payment of
such drawing by the Bank is due). Upon receipt by the Trustee of payment of the
full amount drawn on the Letter of Credit and provided sufficient moneys are
available in the Bond Fund to pay pursuant to Section 5.04 all sums due on the
Bonds, (i) interest on the Bonds shall cease to accrue as provided in Section
10.03 and (ii) the Bank (or the Participating Bank if it has reimbursed the Bank
for such drawing and the Trustee has received written notice from the Bank of
such reimbursement) shall succeed to and be subrogated to the right, title and
interest of the Trustee and the Holders in and to the Loan Agreement, all funds
held under this Indenture (except any funds held in the Bond Fund or any account
with respect to Undelivered Bonds which are identified for the payment of the
Bonds or of the purchase price of Undelivered Bonds) and any other security held
for the payment of the Bonds, all of which, upon payment of any fees and
expenses due and payable to the Trustee pursuant to the Loan Agreement or this
Indenture, shall be assigned by the Trustee to the Bank or the Participating
Bank, as the case may be.
49
If, after the principal of the Bonds has been so declared to be due and
payable, all arrears of principal of and interest on the Bonds outstanding are
paid, and the Issuer and the Borrower also perform all other things in respect
of which either of them may have been in default hereunder or under the Loan
Agreement and pay the reasonable charges of the Trustee, the Holders and any
trustee appointed under the Act, including reasonable attorney's fees, then, and
in every such case, the Trustee or the Holders of a majority in principal amount
of the Bonds then outstanding, by notice to the Issuer and the Borrower (and to
the Holders or the Trustee, as the case may be), may annul such declaration and
its consequences, and such annulment shall be binding upon the Trustee and all
Holders; provided that there shall be no annulment of any declaration resulting
from (1) any Event of Default specified in Subsection 7.01(f) or (g) without the
prior written consent of the Bank and the Participating Bank (and, in the case
of an Event of Default under Section 7.01(g), a corresponding reinstatement of
the Letter of Credit), (2) any Event of Default specified in Section 7.01(h), or
(3) any Event of Default which has resulted in a drawing under the Letter of
Credit unless the Trustee has received written notice from the Bank that the
Letter of Credit has been reinstated (i) while the Bonds are in the Weekly Mode,
to an amount equal to the principal amount of the Bonds outstanding, plus 46
days interest thereon at the Maximum Rate, and (ii) while the Bonds are in a
Term Mode, to an amount equal to the principal amount of the Bonds outstanding,
plus 195 days interest thereon at a rate not less than the current Term Rate. No
annulment shall extend to or affect any subsequent Event of Default or shall
impair any rights consequent thereon.
SECTION 7.04. Other Remedies; Rights of Holders. With or without taking
action under Section 7.03, upon the occurrence and continuance of an Event of
Default, the Trustee may pursue any available remedy to enforce the payment of
Bond Service or the observance and performance of any other covenant, agreement
or obligation under this Indenture, the Loan Agreement or the Letter of Credit
or any other instrument providing security, directly or indirectly, for the
Bonds; provided that, if the Borrower shall be in breach of Section 5.2 of the
Loan Agreement, the Issuer, upon five (5) days written notice to the Borrower
and the Trustee, in addition to any rights and remedies of the Trustee, may
independently seek specific performance or otherwise enforce the covenants set
forth in such Section; provided further that nothing herein shall be construed
to diminish, impair or otherwise limit the rights of the Trustee to enforce the
Loan Agreement.
If any Event of Default has occurred and is continuing, the Trustee in
its discretion may, and upon the written request of Holders of a majority in
principal amount of all Bonds outstanding and receipt of indemnity to its
satisfaction shall, in its own name:
(a) By mandamus, or other suit, action or proceeding at law or
in equity, enforce all rights of the Holders, including the right to
require the Issuer to enforce any rights under the Loan Agreement and
to require the Issuer to carry out any other provisions of this
Indenture for the benefit of the Holders and to perform its duties
under the Act;
(b) Bring suit upon the Bonds;
(c) By action or suit in equity require the Issuer to account
as if it were the trustee of an express trust for the Holders; and
50
(d) By action or suit in equity enjoin any acts or things
which may be unlawful or in violation of the rights of the Holders.
If an Event of Default under Subsection 7.01(e) occurs and is continuing, the
Trustee in its discretion may, and upon the written request of Holders of a
majority in principal amount of all Bonds outstanding or of the Bank or the
Participating Bank and receipt of indemnity to its satisfaction shall, enforce
each and every right granted to it as assignee of the Loan Agreement.
No remedy conferred upon or reserved to the Trustee (or to the Holders)
by this Indenture is intended to be exclusive of any other remedy. Each remedy
shall be cumulative and shall be in addition to every other remedy given
hereunder or otherwise to the Trustee or to the Holders now or hereafter
existing.
No delay in exercising or omission to exercise any remedy, right or
power accruing upon any default or Event of Default shall impair that remedy,
right or power or shall be construed to be a waiver of any default or Event of
Default or acquiescence therein. Every remedy, right and power may be exercised
from time to time and as often as may be deemed to be expedient.
No waiver of any default or Event of Default hereunder, whether by the
Trustee or by the Holders, shall extend to or shall affect any subsequent
default or Event of Default or shall impair any remedy, right or power
consequent thereon.
As the grantee of a security interest in the Loan Agreement (except for
the Unassigned Issuer's Rights), the Trustee is empowered to enforce each
remedy, right and power granted to the Issuer under the Loan Agreement. In
exercising any remedy, right or power thereunder or hereunder, the Trustee shall
take any action which would best serve the interests of the Holders in the
judgment of the Trustee, applying the standards described in Sections 8.01 and
8.02.
SECTION 7.05. Right of Holders to Direct Proceedings. The Holders of a
majority in aggregate principal amount of Bonds outstanding shall have the right
at any time to direct, by an instrument or document in writing executed and
delivered to the Trustee, the method and place of conducting all remedial
proceedings hereunder; provided that (i) any direction shall be in accordance
with the provisions of law and of this Indenture, (ii) the Trustee shall be
indemnified as provided in Sections 8.01 and 8.02, (iii) the Trustee may take
any other action which it deems to be proper and which is not inconsistent with
the direction, and (iv) if the Letter of Credit is in effect and no Event of
Default has occurred and is continuing under Subsection 7.01(i) or (j), then the
Bank (or, with the written consent of the Bank, the Participating Bank) shall
have the right to give such direction in lieu of such Holders.
SECTION 7.06. Application of Moneys. All moneys received by the Trustee
pursuant to any drawing made upon the Letter of Credit pursuant to Section 7.03
shall be applied by the Trustee to and only to the payment of principal of or
premium, if any, or interest on the Bonds (other than Borrower Bonds and Pledged
Bonds). After payment of any fees, costs, expenses, liabilities and advances
paid, incurred or made by the Trustee in the collection of moneys pursuant to
any right given or action taken under the provisions of this Article or the
provisions of the Loan Agreement or the Letter of Credit (including, without
limitation, reasonable attorneys' fees and
51
expenses, except as limited by law or judicial order or decision entered in any
action taken under this Article), all moneys so received by the Trustee, shall
be applied as follows, subject to Sections 3.05, 5.06 and 5.07:
(a) Unless the principal of all of the Bonds shall have
become, or shall have been declared to be, due and payable, all of
those moneys shall be deposited in the Bond Fund and shall be applied:
First -- To the payment to the Holders entitled
thereto of all installments of interest then due on the Bonds,
in the order of the dates of maturity of the installments of
that interest, beginning with the earliest date of maturity
and, if the amount available is not sufficient to pay in full
any particular installment, then to the payment thereof
ratably, according to the amounts due on that installment, to
the Holders entitled thereto, without any discrimination or
privilege, except as to any difference in the respective rates
of interest specified in the Bonds; and
Second -- To the payment to the Holders entitled
thereto of the unpaid principal of any of the Bonds which
shall have become due (other than Bonds previously called for
redemption for the payment of which moneys are held pursuant
to the provisions of this Indenture), whether at stated
maturity or by redemption, in the order of their due dates,
beginning with the earliest due date, with interest on those
Bonds from the respective dates upon which they became due at
the rates specified in those Bonds, and if the amount
available is not sufficient to pay in full all Bonds due on
any particular date, together with that interest, then to the
payment thereof ratably, according to the amounts of principal
due on that date, to the Holders entitled thereto, without any
discrimination or privilege.
The surplus, if any, remaining after the application of the moneys as
set forth above shall to the extent of any unreimbursed drawing under
the Letter of Credit, or other obligations owing to the Bank under the
Participating Bank Agreement, be paid to the Bank. Any remaining moneys
shall be paid first, to the Participating Bank, to the extent of
amounts owing under the Reimbursement Agreement, and second, to the
Borrower or the person lawfully entitled to receive the same as a court
of competent jurisdiction may direct.
(b) If the principal of all of the Bonds shall have become due
or shall have been declared to be due and payable pursuant to this
Article, all of those moneys shall be deposited into the Bond Fund and
shall be applied to the payment of the principal, premium (if any) and
interest then due and unpaid upon the Bonds, without preference or
priority of principal over interest, of interest over principal, 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 Holders entitled
thereto, without any discrimination or privilege, except as to any
difference in the respective rates of interest specified in the Bonds.
(c) If the principal of all of the Bonds shall have been
declared to be due and payable pursuant to this Article, and if that
declaration thereafter shall have been rescinded
52
and annulled under the provisions of Section 7.03 or 7.10, subject to
the provisions of paragraph (b) of this Section in the event that the
principal of all of the Bonds shall become due and payable later, the
moneys shall be deposited in the Bond Fund and shall be applied in
accordance with the provisions of Article V.
(d) Whenever moneys are to be applied pursuant to the
provisions of this Section, those moneys shall be applied at such
times, and from time to time, as the Trustee shall determine, having
due regard to the amount of moneys available for application and the
likelihood of additional moneys becoming available for application in
the future. Whenever the Trustee shall direct the application of those
moneys, it shall fix the date upon which the application is to be made
(and with respect to acceleration such date shall be fixed in
accordance with Section 7.03), and upon that date, interest shall cease
to accrue on the amounts of principal, if any, to be paid on that date,
provided the moneys are available therefor. The Trustee shall give
notice of the deposit with it of any moneys and of the fixing of that
date, all consistent with the requirements of Section 2.08 for the
establishment of, and for giving notice with respect to, a Special
Record Date for the payment of overdue interest. Except as otherwise
provided in Section 2.13, the Trustee shall not be required to make
payment of principal of and any premium on a Bond to the Holder
thereof, until the Bond shall be presented to the Trustee for
appropriate endorsement or for cancellation if it is paid fully.
SECTION 7.07. Remedies Vested in Trustee. All rights of action
(including without limitation, the right to file proof of claims) under this
Indenture or under any of the Bonds may be enforced by the Trustee without the
possession of any of the Bonds or the production thereof in any trial or other
proceeding relating thereto. Any suit or proceeding instituted by the Trustee
shall be brought in its name as Trustee without the necessity of joining any
Holders as plaintiffs or defendants. Any recovery of judgment shall be for the
benefit of the Holders of the outstanding Bonds and the Bank and the
Participating Bank, subject to the provisions of this Indenture.
SECTION 7.08. Rights and Remedies of Holders. A Holder shall not have
any right to institute any suit, action or proceeding for the enforcement of
this Indenture, for the execution of any trust hereof, or for the exercise of
any other remedy hereunder, unless:
(a) there has occurred and is continuing an Event of Default
of which the Trustee has been notified, as provided in Subsection
8.02(f), or of which it is deemed to have notice under that Subsection,
(b) the Holders of at least a majority in aggregate principal
amount of Bonds then outstanding shall have made written request to the
Trustee and shall have afforded the Trustee reasonable opportunity to
proceed to exercise the remedies, rights and powers granted herein or
to institute the suit, action or proceeding in its own name, and shall
have offered indemnity to the Trustee as provided in Sections 8.01 and
8.02, and
(c) the Trustee thereafter shall have failed or refused to
exercise the remedies, rights and powers granted herein or to institute
the suit, action or proceeding in its own name.
53
At the option of the Trustee, such notification (or notice), request,
opportunity and offer of indemnity are conditions precedent in every case, to
the institution of any suit, action or proceeding described above.
No one or more Holders shall have any right to affect, disturb or
prejudice in any manner whatsoever the security or benefit of this Indenture by
its or their action, or to enforce, except in the manner provided herein, any
remedy, right or power hereunder. Any suit, action or proceedings shall be
instituted, had and maintained in the manner provided herein for the benefit of
the Holders of all Bonds outstanding. Notwithstanding the foregoing provisions
of this Section or any other provision of this Indenture, the obligation of the
Issuer shall be absolute and unconditional to pay hereunder, but solely from the
Revenues and other funds pledged under this Indenture, the principal or
redemption price of, and interest on, the Bonds to the respective Holders
thereof on the respective due dates thereof, and nothing herein shall affect or
impair the right of action, which is absolute and unconditional, of such Holders
to enforce such payment; provided that no Holder shall have a right individually
to draw upon the Letter of Credit.
SECTION 7.09. Termination of Proceedings. In case the Trustee shall
have proceeded to enforce any remedy, right or power under this Indenture in any
suit, action or proceeding, and the suit, action or proceeding shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely to the Trustee, the Issuer, the Trustee, the Bank, the Participating
Bank and the Holders shall be restored to their former positions and rights
hereunder, respectively, and all rights, remedies and powers of the Trustee
shall continue as if no suit, action or proceeding had been taken.
SECTION 7.10. Waivers of Events of Default. Except as hereinafter
provided, at any time, in its discretion, the Trustee, but only with the express
prior consent of the Bank and the Participating Bank, may (and, upon written
request of the Holders of a majority in aggregate principal amount of all Bonds
outstanding, shall) waive any Event of Default hereunder and its consequences
and annul any corresponding acceleration of maturity of principal of the Bonds.
There shall not be so waived, however, any Event of Default described in
Subsection 7.01(a), (b), (c), (f), (g), (h), (i) or (j) nor shall any
acceleration in connection therewith be annulled, except with written consent of
the Bank and the Participating Bank and unless at the time of that waiver or
annulment payments of the amounts and satisfaction of the other conditions
provided in Section 7.03 for annulment have been made or provision has been made
therefor; provided that the written consent of the Bank and the Participating
Bank to any waiver shall not be required if there has occurred an Event of
Default under Subsection 7.01(i) or (j). No waiver shall extend to any
subsequent or other Event of Default or impair any right consequent thereon.
SECTION 7.11. Certain Rights of Issuer. Notwithstanding any other
provision hereof, upon the occurrence of an Event of Default described in
Subsection 7.01(e) hereof resulting from an event of default described in
Subsection 7.1(i) of the Loan Agreement, the Issuer reserves the right to
exercise or refrain from exercising remedies under the Loan Agreement with
respect to such Event of Default and such Event of Default may not be waived or
annulled without the prior written consent of the Issuer.
54
SECTION 7.12. Trustee's Right to Appointment of Receiver. As provided
by the Act, the Trustee shall be entitled as of right to the appointment of a
receiver; and the Trustee, the Holders and any receiver so appointed shall have
such rights and powers and be subject to such limitations and restrictions as
are contained in the Act.
SECTION 7.13. Trustee and Holders Entitled to All Benefits Under Act.
It is the purpose of this Article to provide such remedies to the Trustee and
the Holders as may be lawfully granted under the provisions of the Act, but
should any remedy herein granted be held unlawful, the Trustee and the Holders
shall nevertheless be entitled to every remedy provided by the Act. It is
further intended that, insofar as lawfully possible, the provisions of this
Article shall apply to and be binding upon any trustee or receiver appointed
under the Act.
SECTION 7.14. Trustee's Obligation to Banks Upon Payment of All Amounts
Due Holders. Once the principal of and premium, if any, and interest on all
Bonds issued hereunder have been paid, or provision has been made pursuant to
Article X for payment of the same and any purchase price of Bonds that is
payable pursuant to Article IV, together with the compensation and expenses of
the Trustee and all other sums payable hereunder by the Issuer or the Borrower,
the Trustee's sole obligation hereunder shall be to assign promptly and turn
over to the Bank (or the Participating Bank if it has reimbursed the Bank for
all drawings under the Letter of Credit and the Trustee has received written
notice from the Bank of such reimbursement), as successor, subrogee or
otherwise, (i) all of the Trustee's right, title and interest under this
Indenture, (ii) all balances held hereunder not required for the payment of the
Bonds and such other obligations and (iii) the Trustee's right, title and
interest in, to and under the Loan Agreement.
(End of Article VII)
55
ARTICLE VIII
TRUSTEE AND REMARKETING AGENT
SECTION 8.01. Trustee's Acceptance and Responsibilities.
(a) The Trustee accepts the trusts imposed upon it by this Indenture,
and agrees to observe and perform those trusts, but only upon and subject to the
terms and conditions set forth in this Article, to all of which the parties
hereto and the Holders agree. In its capacity as Trustee hereunder, the Trustee
shall authenticate the Bonds and shall act as Bond registrar, transfer agent,
tender agent and paying agent, all as provided herein.
(b) Prior to the occurrence of a default or an Event of Default of
which the Trustee has been notified, as provided in Subsection 8.02(f), or of
which by that Subsection the Trustee is deemed to have notice, and after the
cure or waiver of all defaults or Events of Default which may have occurred,
(i) the Trustee undertakes to perform only those duties and
obligations which are set forth specifically in this Indenture, and no
duties or obligations shall be implied to the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
rely conclusively, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture; but in the case of any such certificates or opinions
which by any provision hereof are required specifically to be furnished
to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Indenture.
(c) In case a default or an Event of Default has occurred and is
continuing hereunder (of which the Trustee has been notified, or is deemed to
have notice), the Trustee shall exercise those rights and powers vested in it by
this Indenture and shall use the same degree of care and skill in their exercise
as a prudent Person would exercise or use under the circumstances in the conduct
of its own affairs.
(d) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own grossly negligent action, its own grossly
negligent failure to act, or its own willful misconduct, except that
(i) this Subsection shall not be construed to affect the
limitation of the Trustee's duties and obligations provided in
Subsection 8.01(b)(i) or the Trustee's right to rely on the truth of
statements and the correctness of opinions as provided in Subsection
8.01(b)(ii);
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(ii) the Trustee shall not be liable for any error of
judgment made in good faith by any of its officers, unless it shall be
established that the Trustee was grossly negligent in ascertaining the
pertinent facts;
(iii) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a majority in
principal amount of the Bonds then outstanding relating to the time,
method and place of conducting any proceeding for any remedy available
to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Indenture; and
(iv) no provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to
it; provided that this clause (iv) shall not relieve the Trustee of its
duties to take actions required to be taken under Section 7.03 and with
respect to drawings to be made under the Letter of Credit and making
payments on the Bonds when due.
(e) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 8.02. Certain Rights and Obligations of Trustee. Except as
otherwise provided in Section 8.01:
(a) The Trustee (i) may execute any of the trusts or powers hereof and
perform any of its duties by or through attorneys, agents, receivers or
employees (but shall be answerable therefor only in accordance with the standard
specified above), (ii) shall be entitled to the advice of counsel concerning all
matters of trusts hereof and duties hereunder, and (iii) may pay reasonable
compensation in all cases to all of those attorneys, agents, receivers and
employees reasonably employed by it in connection with the trusts hereof. The
Trustee may act upon the opinion or advice of any attorney (who may be the
attorney or attorneys for the Issuer or the Borrower) approved by the Trustee in
the exercise of reasonable care. The Trustee shall not be responsible for any
loss or damage resulting from any action taken or omitted to be taken in good
faith in reliance upon that opinion or advice.
(b) Except for its certificate of authentication on the Bonds, the
Trustee shall not be responsible for (i) any recital in this Indenture or in the
Bonds, (ii) the validity, priority, recording, rerecording, filing or refiling
of this Indenture or any Supplemental Indenture, (iii) any instrument or
document of further assurance or collateral assignment, (iv) any financing
statements, amendments thereto or continuation statements, (v) the validity of
the execution by the Issuer of this Indenture, any Supplemental Indenture or
instruments or documents of further assurance, (vi) the sufficiency of the
security for the Bonds issued hereunder or intended to be secured hereby, (vii)
the value of or title to the Project, or insurance of the Project or collection
of insurance moneys, or (viii) the maintenance of the security hereof. The
Trustee shall not be bound to ascertain or inquire as to the observance or
performance of any covenants, agreements or obligations on the part of the
Issuer or the Borrower under the Loan Agreement except as set forth hereinafter;
but the Trustee may require of the Issuer or the Borrower full information and
advice as to the observance or performance of those covenants,
57
agreements and obligations. Except as otherwise provided in Section 7.04, the
Trustee shall have no obligation to observe or perform any of the duties of the
Issuer under the Loan Agreement.
(c) The Trustee shall not be accountable for the application by the
Borrower or any other Person of the proceeds of any Bonds authenticated or
delivered hereunder.
(d) The Trustee may, in the absence of bad faith on its part, act upon
any notice, request, consent, certificate, order, affidavit, letter, telegram or
other paper or document reasonably believed by it to be genuine and correct and
to have been signed or sent by the proper Person or Persons. Any action taken by
the Trustee pursuant to this Indenture upon the request or authority or consent
of any Person who is the Holder of any Bonds at the time of making the request
or giving the authority or consent, shall be conclusive and binding upon all
future Holders of the same Bond and of Bonds issued in exchange therefor or in
place thereof.
(e) As to the existence or nonexistence of any fact for which the
Issuer, the Bank, the Participating Bank or the Borrower may be responsible or
as to the sufficiency or validity of any instrument, document, report, paper or
proceeding, the Trustee, in the absence of bad faith on its part, shall be
entitled to rely upon a certificate signed on behalf of the Issuer, the Bank,
the Participating Bank or the Borrower by an Authorized Representative or
authorized officer thereof, as applicable, as sufficient evidence of the facts
recited therein. Prior to the occurrence of a default or Event of Default
hereunder of which the Trustee has been notified, as provided in Subsection
8.02(f), or of which by that Subsection the Trustee is deemed to have notice,
the Trustee may accept a similar certificate to the effect that any particular
dealing, transaction or action is necessary or expedient; provided that the
Trustee in its discretion may require and obtain any further evidence which it
deems to be necessary or advisable; and provided further that the Trustee shall
not be bound to secure any further evidence. The Trustee may accept a
certificate of the officer, or an assistant thereto, having charge of the
appropriate records, to the effect that a resolution has been adopted by the
Issuer in the form recited in that certificate, as conclusive evidence that the
resolution has been duly adopted and is in full force and effect.
(f) The Trustee shall not be required to take notice, and shall not be
deemed to have notice, of any default or Event of Default hereunder, except
Events of Default described in Subsections 7.01(a), (b), (c), (f), (g) and (h),
unless the Trustee shall be notified specifically of the default or Event of
Default in a written instrument or document delivered to it by the Issuer, the
Bank, the Participating Bank or by the Holders of at least 10% of the aggregate
principal amount of Bonds outstanding. In the absence of delivery of a notice
satisfying those requirements, the Trustee may assume conclusively that there is
no default or Event of Default, except as noted above.
(g) At any reasonable time, the Trustee and its duly authorized agents,
attorneys, experts, engineers, accountants and representatives (i) may inspect
and copy fully all books, papers and records of the Issuer pertaining to the
Project and the Bonds, and (ii) may make any memoranda from and in regard
thereto as the Trustee may desire.
(h) The Trustee shall not be required to give any bond or surety with
respect to the execution of these trusts and powers or otherwise in respect of
the premises.
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(i) Notwithstanding anything contained elsewhere in this Indenture to
the contrary, the Trustee may demand any showings, certificates, reports,
opinions, appraisals and other information, and any corporate action and
evidence thereof, in addition to that required by the terms hereof, as a
condition to the authentication of any Bonds or the taking of any action
whatsoever within the purview of this Indenture, if the Trustee deems it to be
desirable for the purpose of establishing the right of the Issuer to the
authentication of any Bonds or the right of any Person to the taking of any
other action by the Trustee; provided that the Trustee shall not be required to
make any such demand.
(j) Before taking action hereunder pursuant to Section 8.04 or Article
VII (with the exception of any action required to be taken under Section 7.03
and except with respect to drawings made under the Letter of Credit and with
respect to payment on the Bonds when due), the Trustee may require that a
satisfactory indemnity bond be furnished to it for the reimbursement of all
expenses which it may incur and to protect it against all liability by reason of
any action so taken, except liability which is adjudicated to have resulted from
its gross negligence or willful misconduct; provided that no such bond shall be
required from the Issuer. The Trustee may take action without that indemnity,
and in that case, the Issuer shall cause the Borrower to reimburse the Trustee
for all of the Trustee's expenses pursuant to Section 8.03.
(k) Unless otherwise provided herein, all moneys received by the
Trustee under this Indenture shall be held in trust for the purposes for which
those moneys were received, until those moneys are used, applied or invested as
provided herein; provided that those moneys need not be segregated from other
moneys, except to the extent required by this Indenture or by law. The Trustee
shall not have any liability for interest on any moneys received hereunder,
except to the extent expressly provided herein or agreed with the Issuer or the
Borrower.
(l) Any resolution of the Issuer, and any opinions, certificates and
other instruments and documents for which provision is made in this Indenture,
may be accepted by the Trustee, in the absence of bad faith on its part, as
conclusive evidence of the facts and conclusions stated therein and shall be
full warrant, protection and authority to the Trustee for its actions taken
hereunder.
(m) The Trustee may construe any ambiguous or inconsistent provisions
of this Indenture in such manner as it deems reasonable, and any such
construction of such provisions by the Trustee shall be binding upon the Issuer,
the Borrower, the Bank, the Participating Bank and the Holders.
(n) At the written request of any Holder or beneficial owner of the
Bonds, the Trustee shall (i) request the Borrower to provide the Trustee with
copies of such financial statements and reports as the Trustee may be entitled
to receive pursuant to Section 5.5 of the Loan Agreement and (ii) provide to
such Holder or beneficial owner copies of any financial statements and reports
received by the Trustee pursuant to Section 5.5 of the Loan Agreement and/or any
notices of litigation received by the Trustee pursuant to Section 5.9 of the
Loan Agreement.
SECTION 8.03. Fees, Charges and Expenses of Trustee. The Trustee shall
be entitled to payment or reimbursement by the Borrower, as provided in the Loan
Agreement, for reasonable fees for the Ordinary Services of the Trustee and its
agents rendered hereunder and for all
59
advances, counsel fees and other Ordinary Expenses reasonably and necessarily
paid or incurred by it and its agents in connection with the provision of
Ordinary Services. For purposes hereof, fees for Ordinary Services provided for
by their respective standard fee schedule shall be considered reasonable. In the
event that it should become necessary for any of them to perform Extraordinary
Services, they shall be entitled to reasonable extra compensation therefor and
to reimbursement for reasonable and necessary Extraordinary Expenses incurred in
connection therewith. The Trustee shall not be entitled to compensation or
reimbursement for Extraordinary Services or Extraordinary Expenses occasioned by
its gross negligence or willful misconduct.
The fees for the Trustee's Ordinary Services and Ordinary Expenses and
Extraordinary Services and Extraordinary Expenses shall be entitled to payment
and reimbursement only from (i) the Project Fund, (ii) the Additional Payments
made by the Borrower pursuant to the Loan Agreement, or (iii) from other moneys
available therefor; provided that in no event shall any such fees be paid from
funds drawn on the Letter of Credit. Any amounts payable to the Trustee pursuant
to this Section shall be payable upon demand and shall bear interest from five
Business Days following the date of demand therefor at the Interest Rate for
Advances. The initial or acceptance fees of the Trustee and the fees, charges
and expenses of the Trustee and its agents described above, may be paid by the
Trustee from the Project Fund as and when due to the extent that those fees,
charges and expenses become due during the Construction Period (as defined in
the Loan Agreement).
SECTION 8.04. Intervention by Trustee. The Trustee may intervene on
behalf of the Holders, and shall intervene if requested to do so in writing by
the Holders of at least 25% of the aggregate principal amount of Bonds
outstanding, in any judicial proceeding to which the Issuer or the Borrower is a
party and which in the opinion of the Trustee and its counsel has a substantial
bearing on the interests of Holders of the Bonds. The rights and obligations of
the Trustee under this Section are subject to the approval of that intervention
by a court of competent jurisdiction. The Trustee may require that a
satisfactory indemnity bond be provided to it in accordance with Sections 8.01
and 8.02 before it takes action hereunder.
SECTION 8.05. Successor Trustee. Anything herein to the contrary
notwithstanding,
(a) any corporation or association (i) into which the Trustee
may be converted or merged, (ii) with which the Trustee or any
successor to it may be consolidated, or (iii) to which the Trustee may
sell or transfer its assets and trust business as a whole or
substantially as a whole, or any corporation or association resulting
from any such conversion, merger, consolidation, sale or transfer, ipso
facto, shall be and become successor Trustee hereunder and shall be
vested with all of the title to the whole property or trust estate
hereunder; and
(b) that corporation or association, as successor Trustee,
shall be vested further, as was its predecessor, with each and every
trust, property, remedy, power, right, duty, obligation, discretion,
privilege, claim, demand, cause of action, immunity, estate, title,
interest and lien expressed or intended by this Indenture to be
exercised by, vested in or conveyed to the Trustee, without the
execution or filing of any instrument or document or any further act on
the part of any of the parties hereto.
60
Any successor Trustee, however, (i) shall be a trust company or a bank having
the powers of a trust company, (ii) shall be in good standing within the
Commonwealth of Pennsylvania, (iii) shall be duly authorized to exercise trust
powers within the Commonwealth of Pennsylvania, and (iv) shall have a reported
capital and surplus of not less than $50,000,000 and a rating assigned to its
long-term unsecured debt by Moody's Investors Service, Inc. at least equal to
"Baa3" (if the Bonds are then rated by Moody's Investors Service, Inc.) and by
Standard & Poor's Ratings Services at least equal to "BBB-" (if the Bonds are
then rated by Standard & Poor's Ratings Services) unless the Issuer receives
written confirmation from the respective Rating Service that the appointment of
a particular successor trustee not meeting such rating requirement will not
result in a reduction or withdrawal of its rating of the Bonds.
SECTION 8.06. Resignation by Trustee. The Trustee may resign at any
time from the trusts created hereby by giving written notice of the resignation
to the Issuer, the Borrower, the Bank, the Participating Bank and the
Remarketing Agent and by mailing written notice of the resignation to the
Holders as their names and addresses appear on the Register at the close of
business 15 days prior to the mailing. The resignation shall take effect only
upon the appointment of a successor Trustee.
SECTION 8.07. Removal of Trustee. The Trustee may be removed at any
time by an instrument or document or concurrent instruments or documents
delivered to the Trustee at least five Business Days prior to the date of
removal, with copies thereof mailed to the Issuer, the Borrower, the Bank, the
Participating Bank and the Remarketing Agent, and signed by or on behalf of the
Holders of not less than a majority in aggregate principal amount of the Bonds
outstanding.
The Trustee also may be removed at any time for any breach of trust or
for acting or proceeding in violation of, or for failing to act or proceed in
accordance with, any provision of this Indenture with respect to the duties and
obligations of the Trustee by any court of competent jurisdiction upon the
application of the Issuer or the Holders of not less than 25% in aggregate
principal amount of the Bonds outstanding.
The removal of the Trustee pursuant to this Section shall take effect
only upon the appointment of a successor Trustee.
SECTION 8.08. Appointment of Successor Trustee. If (i) the Trustee
shall resign, shall be removed, shall be dissolved, or shall become otherwise
incapable of acting hereunder, (ii) the Trustee shall be taken under the control
of any public agency, or (iii) a receiver shall be appointed for the Trustee by
a court, then a successor Trustee shall be appointed by the Issuer, with the
written consent of the Borrower, the Bank and the Participating Bank; provided
that if a successor Trustee is not so appointed within 10 days after (a) a
notice of resignation or an instrument or document of removal is received by the
Issuer, as provided in Sections 8.06 and 8.07, respectively, or (b) the Trustee
is dissolved, taken under control, becomes otherwise incapable of acting or a
receiver is appointed, in each case, as provided above, then, so long as the
Issuer shall not have appointed a successor Trustee, the Holders of a majority
in aggregate principal amount of Bonds outstanding may designate a successor
Trustee by an instrument or document or concurrent instruments or documents in
writing signed by or on behalf of those Holders. If no appointment of a
successor Trustee shall be made pursuant to the foregoing provisions of this
Section, the Holder of any Bond outstanding or any
61
retiring Trustee may apply to any court of competent jurisdiction to appoint a
successor Trustee. Such court may thereupon, after such notice, if any, as such
court may deem proper and prescribe, appoint a successor Trustee.
Every successor Trustee appointed pursuant to this Section (i) shall be
a trust company or a bank having the powers of a trust company, (ii) shall be in
good standing within the Commonwealth of Pennsylvania, (iii) shall be duly
authorized to exercise trust powers within the Commonwealth of Pennsylvania,
(iv) shall have a reported capital and surplus of not less than $50,000,000 and
a rating assigned to its long-term unsecured debt by Moody's Investors Service,
Inc. at least equal to "Baa3" (if the Bonds are then rated by Moody's Investors
Service, Inc.) and by Standard & Poor's Ratings Services at least equal to
"BBB-" (if the Bonds are then rated by Standard & Poor's Ratings Services)
unless the Issuer receives written confirmation from the Rating Service that the
appointment of a particular successor trustee not meeting such rating
requirement will not result in a reduction or withdrawal of its rating of the
Bonds, and (v) shall be willing to accept the trusteeship under the terms and
conditions of this Indenture.
Every successor Trustee appointed hereunder shall execute and
acknowledge, and shall deliver to its predecessor, the Issuer, the Borrower, the
Bank, the Participating Bank and the Remarketing Agent, an instrument or
document in writing accepting the appointment. Thereupon, without any further
act, the successor shall become vested with all of the trusts, properties,
claims, demands, causes of action, immunities, estates, titles, interests and
liens of its predecessor. Upon the written request of its successor, the Issuer,
the Borrower, the Bank, the Participating Bank or the Remarketing Agent, the
predecessor Trustee (i) shall execute and deliver an instrument or document
transferring to its successor all of the trusts, properties, remedies, powers,
rights, duties, obligations, discretions, privileges, claims, demands, causes of
action, immunities, estates, titles, interests and liens of the predecessor
Trustee hereunder, and (ii) shall take any other action necessary to duly
assign, transfer and deliver to its successor all property (including, without
limitation, all securities and moneys and the Letter of Credit) held by it as
Trustee. Should any instrument or document in writing from the Issuer be
requested by any successor Trustee for vesting and conveying more fully and
certainly in and to that successor the trusts, properties, remedies, powers,
rights, duties, obligations, discretions, privileges, claims, demands, causes of
action, immunities, estates, titles, interests and liens vested or conveyed or
intended to be vested or conveyed hereby in or to the predecessor Trustee, the
Issuer shall execute, acknowledge and deliver that instrument or document.
In the event of a change in the Trustee, the predecessor Trustee shall
cease to be custodian of any moneys which it may hold pursuant to this Indenture
and shall cease to be Bond registrar, transfer agent, tender agent,
authenticating agent and paying agent for the Bonds. The successor Trustee shall
become custodian for moneys held under this Indenture and Bond registrar,
transfer agent, tender agent, authenticating agent and paying agent as and to
the extent provided herein.
SECTION 8.09. Adoption of Authentication. In case any of the Bonds
shall have been authenticated, but shall not have been delivered, any successor
Trustee may adopt the certificate of authentication of any predecessor Trustee
and may deliver those Bonds so authenticated as provided herein. In case any
Bonds shall not have been authenticated, any successor Trustee may authenticate
those Bonds either in the name of any predecessor or in its own name. In all
cases, the
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certificate of authentication shall have the same force and effect as provided
in the Bonds or in this Indenture with respect to the certificate of
authentication of the predecessor Trustee.
SECTION 8.10. Designation and Succession of Authenticating Agent, Bond
Registrar, Transfer Agent, Tender Agent and Paying Agent. The Trustee may, with
the consent of the Issuer, appoint an agent or agents, with power to act on the
Trustee's behalf and subject to the Trustee's direction in the authentication,
registration, transfer and exchange and tender of Bonds and payment of Bond
Service under the provisions of this Indenture; provided that any tender agent
or paying agent so appointed shall have and maintain a rating assigned to its
long-term unsecured debt by Moody's Investors Service, Inc. at least equal to
"Baa3" (if the Bonds are then rated by Moody's Investors Service, Inc.) and by
Standard & Poor's Ratings Services at least equal to "BBB-" (if the Bonds are
then rated by Standard & Poor's Ratings Services) unless the Issuer receives
written confirmation from the Rating Service that the appointment of a tender
agent or paying agent not meeting such rating requirement will not result in a
reduction or withdrawal of its rating of the Bonds. For all purposes of this
Indenture, the authentication, registration and delivery of Bonds by any such
agent pursuant to this Section shall be deemed to be authentication,
registration and delivery of those Bonds by the Trustee.
Any corporation or association with or into which any such agent may be
merged or converted or with which it may be consolidated, or any corporation or
association resulting from any merger, consolidation or conversion to which any
such agent shall be a party, or any corporation or association succeeding to the
trust business of any such agent, shall be the successor of that agent
hereunder, if that successor corporation or association is otherwise eligible
hereunder, without the execution or filing of any paper or any further act on
the part of the parties hereto or the such agent or such successor corporation.
Any such agent may at any time resign by giving written notice of
resignation to the Trustee and to the Issuer, the Borrower and the Remarketing
Agent. The Trustee may at any time terminate the agency of any such agent by
giving written notice of termination to such agent and to the Issuer, the
Borrower and the Remarketing Agent. Upon receiving such a notice of resignation
or upon such a termination, or in the case at any time any such agent shall
cease to be eligible under this Section, the Trustee may appoint a successor
agent. The Trustee shall give written notice of appointment of a successor agent
to the Issuer, the Borrower and the Remarketing Agent and shall mail, within 10
days after that appointment, notice thereof to all Holders as their names and
addresses appear on the Register on the date of that appointment.
The Trustee shall pay to any such agent from time to time reasonable
compensation for its services, and the Trustee shall be entitled to be
reimbursed for such payments as Ordinary Expenses, subject to Section 8.03.
The pertinent provisions of Subsections 8.02(b), (c), (d), (h) and (i)
shall be applicable to any such agent.
SECTION 8.11. Dealing in Bonds. The Trustee, the Bank, the
Participating Bank and the Remarketing Agent, their affiliates, and any
directors, officers, employees or agents thereof, in good faith, may become the
owners of Bonds secured hereby with the same rights which it
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or they would have hereunder if the Trustee, the Bank, the Participating Bank or
the Remarketing Agent did not serve in those capacities. The Trustee may be, or
be affiliated with, the Remarketing Agent, the Bank or the Participating Bank.
The Trustee may also engage in or be interested in any financial or other
transaction with the Issuer, the Borrower or any related party.
SECTION 8.12. Representations, Agreements and Covenants of Trustee.
Dauphin Deposit Bank and Trust Company hereby represents and covenants that it
is a Pennsylvania banking corporation duly organized and validly existing under
the laws of, and duly authorized to exercise corporate trust powers in, the
Commonwealth of Pennsylvania, that it will take such action, if any, as is
necessary to remain in good standing and duly authorized to exercise corporate
trust powers in the Commonwealth of Pennsylvania, and that it has a rating
assigned to its long-term unsecured debt by Moody's Investors Service, Inc. at
least equal to "Baa3" (if the Bonds are then rated by Moody's Investors Service,
Inc.) and by Standard & Poor's Ratings Services at least equal to "BBB-" (if the
Bonds are then rated by Standard & Poor's Ratings Services).
SECTION 8.13. Appointment of Remarketing Agent. The Issuer shall, with
notice to the Borrower, appoint the Remarketing Agent for the Bonds, subject to
the conditions set forth in Section 8.14. The Remarketing 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 Issuer, the Borrower and the Trustee under which the
Remarketing Agent will agree, particularly:
(a) to hold all Bonds delivered to it by the Trustee for
delivery to the Holders of such Bonds;
(b) to hold all moneys delivered to it representing the
purchase price of Bonds for the benefit of the Person or entity
entitled to receive the payment of such purchase price;
(c) to determine the Weekly Rate and the Term Rate in
accordance with Sections 2.03 and 2.04 of this Indenture, and to give
notice to the Trustee of the Weekly Rate, and to the Trustee, the
Issuer, the Borrower, the Bank and the Participating Bank of the Term
Rate, on the date of the determination thereof; and
(d) 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 Issuer, the Trustee, the Borrower, the Bank and
the Participating Bank at all reasonable times.
In addition, the Remarketing Agent will enter into the Remarketing Agreement
with the Borrower in form and substance mutually satisfactory to them. The
Remarketing Agent shall be entitled to advice of legal counsel on any matter
relating to the Remarketing Agent's obligations hereunder and shall be entitled
to act upon the opinion of such counsel in the exercise of reasonable care in
fulfilling such obligations.
SECTION 8.14. Qualifications of Remarketing Agent. The Remarketing
Agent shall be a national banking association or a bank or trust company or a
member of the National
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Association of Securities Dealers, Inc., authorized by law to perform all the
duties imposed upon it by this Indenture, and shall have a rating assigned to
its long-term unsecured debt by Moody's Investors Service, Inc. at least equal
to "Baa3" (if the Bonds are then rated by Moody's Investors Service, Inc.) and
by Standard & Poor's Ratings Services at least equal to "BBB-" (if the Bonds are
then rated by Standard & Poor's Ratings Services) unless the Issuer receives
written confirmation from the Rating Service that the appointment of a
particular Remarketing Agent not meeting such rating requirement will not result
in a reduction or withdrawal of its rating of the Bonds. The Remarketing Agent
may at any time resign and be discharged of the duties and obligations created
by this Indenture by giving at least 30 days' prior written notice by registered
or certified mail to the Trustee, the Issuer, the Borrower, the Bank and the
Participating Bank. The Remarketing Agent may be removed at any time by the
Issuer, with the consent of the Borrower (provided that the Borrower shall be
deemed to have consented to the removal of a Remarketing Agent which has ceased
to meet the foregoing qualifications), upon 30 days' notice which shall be in
writing, signed by the Issuer and delivered to the Remarketing Agent, the
Borrower, the Trustee, the Bank and the Participating Bank.
In the event of the resignation or removal of the Remarketing Agent,
the Issuer, with the consent of the Borrower, the Bank and the Participating
Bank, shall appoint a successor Remarketing Agent meeting the qualifications set
forth in this Section and the Remarketing Agent shall pay over, assign and
deliver any moneys and Bonds held by it in such capacity to its successor or, if
there be no successor, to the Trustee as hereinafter provided.
In the event that the Remarketing Agent shall resign or be removed, or
be dissolved, or if the property or affairs of the Remarketing 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 Issuer
shall not have appointed its successor as Remarketing Agent, the Trustee,
notwithstanding the provisions of the first paragraph of this Section, shall
ipso facto be deemed to be the Remarketing Agent for all purposes of this
Indenture until the appointment by the Issuer of the successor Remarketing
Agent; provided that the Trustee, in its capacity as Remarketing Agent, shall
not be required to remarket Bonds nor to establish the Weekly Rate or the Term
Rate.
SECTION 8.15. Compensation and Expenses of Remarketing Agent. Pursuant
to Section 4.4 of the Loan Agreement, the Borrower is obligated to pay directly
reasonable compensation to and the reasonable expenses of the Remarketing Agent.
The terms of such obligation may be set forth in the Remarketing Agreement.
(End of Article VIII)
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ARTICLE IX
SUPPLEMENTS AND AMENDMENTS
SECTION 9.01. Supplemental Indentures Not Requiring Consent of Holders.
Without the consent of or notice to any Holders, the Issuer and the Trustee may
enter into indentures supplemental to this Indenture for any one or more of the
following purposes:
(a) To cure any ambiguity, inconsistency or formal defect or
omission in this Indenture;
(b) To grant to or confer upon the Trustee for the benefit of
the Holders any additional rights, remedies, powers or authority;
(c) To confirm any pledge of or lien on the Revenues, to
assign additional revenues under this Indenture or to accept additional
security or instruments of further assurance;
(d) To add to the covenants, agreements and obligations of the
Issuer under this Indenture, other covenants, agreements and
obligations to be observed for the protection of the Holders, or to
surrender or limit any right, power or authority reserved to or
conferred upon the Issuer in this Indenture;
(e) To permit the use of a book entry system to identify the
owner of an interest in an obligation issued by the Issuer under this
Indenture, whether that obligation was formerly, or could be, evidenced
by a tangible security;
(f) To permit the Trustee to comply with any obligations
imposed upon it by law;
(g) To specify further the duties and responsibilities of, and
to define further the relationship among, the Trustee and the
Remarketing Agent;
(h) To achieve compliance of this Indenture with any
applicable federal securities or tax laws;
(i) To evidence the appointment of a new Remarketing Agent;
(j) To provide for an Alternate Letter of Credit any other
credit enhancement, or no credit enhancement, all as permitted by the
terms of this Indenture;
(k) To make any amendments required to secure a rating on the
Bonds from a Rating Service equal to the rating of the Bank's unsecured
indebtedness;
66
(l) To implement a conversion to a Term Mode Rate; or
(m) To permit any other amendment which is not materially
adverse to the interests of the Trustee or the Holders.
Before the Issuer and the Trustee shall enter into any Supplemental Indenture
pursuant to this Section, there shall have been delivered to the Trustee and the
Issuer an opinion of Bond Counsel to the effect that such Supplemental Indenture
is authorized or permitted by this Indenture and the Act and will, upon the
execution and delivery thereof, be valid and binding upon the Issuer in
accordance with its terms.
SECTION 9.02. Supplemental Indentures Requiring Consent of Holders. In
addition to the Supplemental Indentures permitted by Section 9.01, this
Indenture may be amended or supplemented from time to time by a Supplemental
Indenture consented to by the Borrower and approved by Holders of a majority in
aggregate principal amount of the Bonds then outstanding, except that, other
than as permitted by Section 9.01, this Indenture may not be amended with
respect to (1) the principal or redemption price or interest payable upon any
Bonds, (2) the Interest Payment Dates, the dates of maturity or the redemption
or purchase provisions of any Bonds, and (3) this Article. This Indenture may be
amended with respect to the matters enumerated in clauses (1) to (3) of the
preceding sentence only with the unanimous consent of all Holders. Before the
Issuer and the Trustee may enter into such Supplemental Indenture, there shall
have first been delivered to the Trustee (a) the required consents, in writing,
of Holders and (b) an opinion of Bond Counsel to the effect that such
Supplemental Indenture is authorized or permitted by this Indenture and the Act
and will, upon the execution and delivery thereof, be valid and binding upon the
Issuer in accordance with its terms.
SECTION 9.03. Consent of Borrower and Participating Bank. Anything
contained herein to the contrary notwithstanding, a Supplemental Indenture
executed and delivered in accordance with this Article which affects any rights
of the Borrower or the Participating Bank shall not become effective unless and
until the Borrower or the Participating Bank (as appropriate) shall have
consented in writing to the execution and delivery of that Supplemental
Indenture.
SECTION 9.04. Authorization to Trustee; Effect of Supplement. The
Trustee is authorized to join with the Issuer in the execution and delivery of
any Supplemental Indenture in accordance with this Article and to make the
further agreements and stipulations which may be contained therein. Thereafter,
(a) such Supplemental Indenture shall form a part of this Indenture; (b) all
terms and conditions contained in that Supplemental Indenture as to any
provision authorized to be contained therein shall be deemed to be a part of the
terms and conditions of this Indenture for any and all purposes; (c) this
Indenture shall be deemed to be modified and amended in accordance with the
Supplemental Indenture; and (d) the respective rights, duties and obligations
under this Indenture of the Issuer, the Borrower, the Trustee, the Paying
Agents, the Remarketing Agent, the Bank, the Participating Bank and all Holders
of Bonds outstanding shall be determined, exercised and enforced hereunder in a
manner which is subject in all respects to those modifications and amendments
made by the Supplemental Indenture. The Trustee shall not be required to execute
any Supplemental Indenture containing provisions adverse to the Trustee.
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SECTION 9.05. Modification by Unanimous Consent. Notwithstanding
anything contained elsewhere in this Indenture, the rights and obligations of
the Issuer and of the Holders, and the terms and provisions of the Bonds and
this Indenture or any Supplemental Indenture, may be modified or altered in any
respect with the consent of (i) the Issuer, (ii) the Holders of all of the Bonds
outstanding, (iii) the Bank, (iv) the Participating Bank and (v) the Borrower.
SECTION 9.06. Amendment of Loan Agreement. If the Issuer and the
Borrower propose to amend the Loan Agreement, the Trustee may consent thereto;
provided that if such proposal would amend the Loan Agreement in such a way as
would materially adversely affect the interests of the Holders, the Trustee
shall notify Holders of the proposed amendment and may consent thereto with the
consent of Holders of a majority in aggregate principal amount of the Bonds then
outstanding, except that no amendment materially adversely affecting the
interests of the Holders shall be consented to by the Trustee without the
unanimous consent of all Holders if such materially adverse amendment would (1)
decrease the amounts payable under the Loan Agreement constituting Revenues, (2)
change the date of payment or prepayment provisions under the Loan Agreement, or
(3) change any provisions with respect to amendment. Before the Issuer shall
enter into, and the Trustee shall consent to, any modification, alteration,
amendment or supplement to the Loan Agreement pursuant to this Section, there
shall have been delivered to the Issuer and the Trustee an opinion of Bond
Counsel to the effect that such amendment is authorized or permitted by this
Indenture and the Act.
SECTION 9.07. Amendment of Letter of Credit. If the Bank proposes to
amend the Letter of Credit, the Trustee may consent thereto, provided that (a)
if such proposal would amend the Letter of Credit in such a way as would
materially adversely affect the interests of the Holders, the Trustee shall
notify the Holders and the Rating Service (if the Bonds are then rated by a
Rating Service) of the proposed amendment and may consent thereto only with (i)
the prior written consent of Holders of a majority in aggregate principal amount
of the Bonds then outstanding and (ii) the confirmation by such Rating Service
that such amendment will not result in a withdrawal or reduction of its rating
of the Bonds, and (b) the Trustee shall not, without the unanimous consent of
all Holders, consent to any amendment materially adversely affecting the
interests of the Holders which would decrease or delay the amounts payable under
the Letter of Credit in respect of outstanding Bonds on any Interest Payment
Date or on any date of redemption, acceleration, payment at maturity or purchase
of the Bonds, or advance the Expiration Date of the Letter of Credit to an
earlier date. No consent of the Holders shall be required for amendments to the
Letter of Credit which are provided for or contemplated by this Indenture.
SECTION 9.08. Trustee Authorized to Join in Supplements and Amendments;
Reliance on Counsel. The Trustee is authorized to join with the Issuer in the
execution and delivery of any Supplemental Indenture or amendment permitted by
this Article and in so doing shall be fully protected by an opinion of Counsel
that such Supplemental Indenture or amendment is so permitted.
SECTION 9.09. Bank Consent. Notwithstanding anything herein contained,
so long as a Letter of Credit is held by the Trustee, no supplement or amendment
shall be made to the Indenture or the Loan Agreement without the prior written
consent of the Bank.
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SECTION 9.10. Notice to Rating Service. The Trustee shall promptly
notify the Rating Service (if the Bonds are then rated by a Rating Service) of
any material supplement or amendment to this Indenture, the Loan Agreement, the
Remarketing Agreement, the Letter of Credit, the Participating Bank Agreement or
the Reimbursement Agreement.
(End of Article IX)
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ARTICLE X
DEFEASANCE
SECTION 10.01. Defeasance. When the principal of, and premium (if any)
and interest on, all Bonds issued hereunder have been paid, or provision has
been made for payment of the same and any tender purchase price which may become
payable pursuant to Article IV, together with the compensation and expenses of
the Trustee and all other sums payable hereunder by the Issuer or the Borrower,
the right, title and interest of the Trustee in and to the Trust Estate shall
thereupon cease and the Trustee, on demand of the Issuer or the Borrower, shall
release this Indenture and shall execute such documents to evidence such release
as may be reasonably required by the Issuer or the Borrower and shall turn over
to the Borrower or to such person, body or authority as may be entitled to
receive the same all balances then held by it hereunder not required for the
payment of the Bonds and such other sums and shall surrender the Letter of
Credit to the Bank; provided that (a) any proceeds of the Letter of Credit not
required for payment of the Bonds shall be turned over to the Bank and (b) in
the event there has been a drawing under the Letter of Credit for which the Bank
has not been fully reimbursed pursuant to the Participating Bank Agreement or
any other obligations are then due and owing to the Bank under the Participating
Bank Agreement (or, in the event the Participating Bank has not been fully
reimbursed pursuant to the Reimbursement Agreement or any other obligations are
then due and owing to the Participating Bank under the Reimbursement Agreement),
the Trustee shall assign and turn over to the Bank (or to the Participating Bank
if the Trustee has received notice from the Bank that such obligations owing to
it have been fully paid), as successor, subrogee or otherwise, all of the
Trustee's right, title and interest under this Indenture, all balances held
hereunder not required for the payment of the Bonds and such other sums and the
Trustee's right, title and interest in, to and under the Loan Agreement and any
other property comprising the Trust Estate. If payment or provision therefor is
made with respect to less than all of the Bonds, the particular Bonds (or
portions thereof) for which provision for payment shall have been considered
made shall be selected by lot or by such other method as the Trustee deems fair
and appropriate, and thereupon the Trustee shall take similar action for the
release of this Indenture with respect to such Bonds.
SECTION 10.02. Provision for Payment.
(a) Provision for the payment of Bonds shall be deemed to have been
made when the Trustee holds in the Bond Fund (1) cash in an amount sufficient to
make all payments (including principal, premium, if any, interest and tender
purchase price payments, if any) specified in Section 10.01 with respect to such
Bonds, or (2) noncallable, direct obligations issued by the United States of
America, maturing on or before the date or dates when the payments specified
above shall become due, the principal amount of which and the interest thereon,
when due, is or will be, in the aggregate, sufficient without reinvestment to
make all such payments, or (3) any combination of cash and such obligations the
amounts of which and interest thereon, when due, are or will be, in the
aggregate, sufficient without reinvestment to make all such payments; provided
that (i) such amount on deposit shall be deemed sufficient only if (A) while the
Bonds bear interest at a Weekly Rate, it provides for payment of interest at the
Maximum Rate and the Issuer shall have surrendered any power hereunder to
thereafter change the Maximum Rate, or (B) while the Bonds bear interest at a
Term Rate, it provides for payment of interest at such Term Rate and the Bonds
have been irrevocably called or designated for
70
redemption in accordance with Subsection 10.02(c) on or before the Term Rate
Period End Interest Payment Date of the Term Period for which such Term Rate has
been set, and (ii) provision for payment of Bonds shall be deemed to be made
only if (A) the Trustee holds in the Bond Fund cash constituting Available
Moneys and/or such obligations purchased with Available Moneys for payment of
such Bonds pursuant to Section 5.04 in amounts sufficient to make all payments
specified above with respect to such Bonds, as verified by an accountant's
certification in form and by an accountant acceptable to the Trustee and the
Rating Service, and (B) in the case of Bonds in the Weekly Mode, the Bonds have
been called for redemption on a date not more than 60 days from the date
provision for payment is being made pursuant to this Section and, in determining
the sufficiency of amounts held to make payments with respect to the Bonds,
there shall be excluded any and all interest expected to be earned on
obligations held by the Trustee.
(b) Neither the moneys nor the obligations deposited with the Trustee
pursuant to this Article shall be withdrawn or used for any purpose other than,
and such obligations and moneys shall be segregated and held in trust for, the
payment of the principal or redemption price of, premium, if any, on and
interest on, the Bonds (or portions thereof), or for the payment of the purchase
price of such Bonds in accordance with Article IV. While the Bonds are in the
Weekly Mode, such moneys, if not then needed for such purpose, shall, but only
to the extent practicable, be invested and reinvested in direct obligations
issued by the United States of America maturing on or prior to the earlier of
(i) the date moneys may be required for the purchase of Bonds pursuant to
Article IV and (ii) the Interest Payment Date next succeeding the date of
investment or reinvestment.
(c) Whenever moneys or obligations shall be deposited with the Trustee
for the payment or redemption of Bonds more than 60 days prior to the date that
such Bonds are to mature or be redeemed, the Trustee shall mail a notice to the
Holders of Bonds for the payment of which such moneys or obligations are being
held at their registered addresses stating that such moneys or obligations have
been deposited. Such notice shall also be sent by the Trustee to the Rating
Service. Notwithstanding the foregoing, no delivery to the Trustee under this
Section shall be deemed a payment of any Bonds which are to be redeemed prior to
their stated maturity until such Bonds shall have been irrevocably called or
designated for redemption on a date thereafter on which such Bonds may be
redeemed in accordance with the provisions of this Indenture and proper notice
of such redemption shall have been given in accordance with Article III or the
Issuer shall have given the Trustee, in form satisfactory to the Trustee,
irrevocable instructions to give, in the manner and at the times prescribed by
Article III, notice of redemption.
SECTION 10.03. Deposit of Funds for Payment of Bonds. If the principal
or tender purchase price of any Bonds becoming due, either at maturity or by
call for redemption or tender or otherwise, together with the premium (if any)
thereon and all interest accruing thereon to the due date, has been paid or
provision therefor made in accordance with Section 10.02, all interest on such
Bonds shall cease to accrue on the due date and all liability of the Issuer with
respect to such Bonds shall likewise cease, except as hereinafter provided.
Thereafter, (a) any surplus balance held by the Trustee with respect to such
Bonds over the principal of, premium (if any) on and actual interest accrued on
such Bonds shall be paid to the Bank as a return of excess funds drawn under the
Letter of Credit (or, if the Rating Service shall have confirmed its rating of
the Bonds in connection with the provision for payment of the Bonds, such
surplus shall be paid as may otherwise be approved by the Rating Service in
connection with such confirmation) and (b) the Holders of such Bonds shall be
71
restricted exclusively to the funds so deposited for any claim of whatsoever
nature with respect to such Bonds, and the Trustee shall hold such funds in
trust for such Holders uninvested and without liability for interest thereon.
Moneys so deposited with the Trustee which remain unclaimed five years after the
date payment thereof becomes due shall, at the request of the Borrower (or the
Bank or Participating Bank) and if neither the Issuer nor the Borrower is at the
time to the knowledge of the Trustee in default with respect to any covenant
contained in the Indenture, the Bonds or the Loan Agreement, be paid to the
Borrower (or to the Bank or the Participating Bank as provided in Section 10.01
with respect to surplus balances), and the Holders of the Bonds for which the
deposit was made shall thereafter be limited to a claim against the Borrower;
provided that (i) such moneys shall not be remitted to the Borrower unless the
Trustee shall have received an opinion of counsel experienced in matters
pertaining to the United States Bankruptcy Code to the effect that the
contemplated delivery of such moneys to the Borrower will not cause any other
moneys paid to the Holders to be transfers of property voidable under Section
547 of the United States Bankruptcy Code should the Issuer or the Borrower
become a debtor under the United States Bankruptcy Code, and (ii) the Trustee,
before making payment to the Borrower, may, at the expense of the Borrower,
cause a notice to be given to the Holders at their registered addresses, stating
that the moneys remaining unclaimed will be returned to the Borrower after a
specified date.
SECTION 10.04. Survival of Certain Provisions. Notwithstanding the
foregoing, any provisions of this Indenture which relate to the maturity of
Bonds, interest payments and dates thereof, optional and mandatory redemption
provisions, credit against mandatory sinking fund requirements, exchange,
transfer and registration of Bonds, replacement of mutilated, lost, wrongfully
taken or destroyed Bonds, safekeeping and cancellation of Bonds, nonpresentment
of Bonds, holding of moneys in trust, payment of moneys to the Borrower, the
Bank and the Participating Bank, and the duties of the Trustee in connection
with all of the foregoing, shall remain in effect and be binding upon the
Trustee and the Holders notwithstanding the release and discharge of this
Indenture. The provisions of this Article shall survive the release, discharge
and satisfaction of this Indenture.
(End of Article X)
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ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Limitation of Rights; No Personal Recourse. With the
exception of rights conferred expressly in this Indenture, nothing expressed or
mentioned in or to be implied from this Indenture or the Bonds is intended or
shall be construed to give to any Person other than the parties hereto, the
Borrower, the Remarketing Agent, the Bank, the Participating Bank and the
Holders any legal or equitable right, remedy, power or claim under or with
respect to this Indenture or any covenants, agreements, conditions and
provisions contained herein.
This Indenture does not pledge the general credit nor the taxing power
of the Commonwealth of Pennsylvania or any political subdivision thereof. The
liability of the Issuer hereunder and under the Bonds and the Loan Agreement
shall be limited to its interest in the Trust Estate.
No covenant or agreement contained in this Indenture, the Bonds or the
Loan Agreement shall be deemed to be the covenant or agreement of any member,
director, officer, attorney, agent or employee of the Issuer in an individual
capacity. No recourse shall be had for the payment of any claim based thereon
against any member, director, officer, agent, attorney or employee of the Issuer
past, present or future, or its successors or assigns, as such, either directly
or through the Issuer, or any such successor corporation, whether by virtue of
any constitutional provision, statute or rule of law, or by the enforcement of
any assessment or penalty, or otherwise.
SECTION 11.02. Severability. In case any section or provision of this
Indenture, or any covenant, agreement, stipulation, obligation, act or action,
or part thereof, made, assumed, entered into or taken under this Indenture, or
any application thereof, is held to be illegal or invalid for any reason, or is
inoperable at any time, such illegality, invalidity or inoperability shall not
affect the remainder thereof or any other section or provision of this Indenture
or any other covenant, agreement, stipulation, obligation, act or action, or
part thereof, made, assumed, entered into or taken under this Indenture, all of
which shall be construed and enforced at the time as if the illegal, invalid or
inoperable portion were not contained therein.
SECTION 11.03. Notices. Except as provided in Sections 3.04 and 7.02,
it shall be sufficient service or giving of any notice, request, complaint,
demand or other instrument or document, if it is duly mailed by first class
mail. Notices to the Issuer, the Trustee, the Borrower, the Bank, the
Participating Bank and the Remarketing Agent shall be addressed as follows:
(a) If to the Issuer, at Montgomery County Industrial
Development Authority, 3 Stoney Creek Office Center, 151 West Marshall
Street, Norristown, Pennsylvania 19401, Attention: Gerald Birkelbach,
Executive Director;
(b) If to the Trustee, at Dauphin Deposit Bank and Trust
Company, Trustee, 213 Market Street, Harrisburg, Pennsylvania 17101,
Attention: Corporate Trust Services Department, M/C #001-01-02;
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(c) If to the Borrower, at Neose Technologies, Inc., 102
Witmer Road, Horsham, Pennsylvania 19044, Attention: P. Sherrill Neff,
President, with a copy to Ballard Spahr Andrews & Ingersoll, 1735
Market Street, Philadelphia, Pennsylvania 19103, Attention: Lynn
Axelroth, Esquire;
(d) If to the Bank, at CoreStates Bank, N.A., FC1-1-5-22,
Broad and Chestnut Streets, Philadelphia, Pennsylvania 19101,
Attention: Global Financial Institutions;
(e) If to the Participating Bank, at Jefferson Bank, 1607
Walnut Street, Philadelphia, Pennsylvania 19103, Attention: Kenneth R.
Frappier, Senior Vice President; and
(f) If to the Remarketing Agent, at CoreStates Capital
Markets, a Division of CoreStates Bank, N.A., 600 Penn Street, 2nd
Floor, Reading, Pennsylvania 19602.
The foregoing parties may designate, by notice given hereunder, any further or
different addresses to which any subsequent notice, request, demand or other
instrument or document shall be sent. The Trustee shall designate, by notice to
the Issuer, the Borrower, the Bank, the Participating Bank and the Remarketing
Agent addresses to which notices or copies thereof shall be sent to the
Trustee's agents hereunder.
In connection with any notice mailed pursuant to the provisions of this
Indenture, a certificate of the Trustee, the Issuer, the Borrower, the Bank, the
Participating Bank, the Remarketing Agent or the Holders, whichever mailed that
notice, that the notice was so mailed shall be conclusive evidence of the proper
mailing of the notice.
The Trustee hereby agrees to send written notice to the Rating Service
upon the occurrence of any of the following events: (1) any change in the
Trustee or the Remarketing Agent or any tender agent or paying agent; (2) any
amendment to the Indenture, the Loan Agreement, the Participating Bank Agreement
or the Letter of Credit; (3) any termination, expiration or extension of the
Letter of Credit; (4) each conversion of the interest rate on the Bonds; and (5)
payment of all principal, interest and premium, if any, on all of the Bonds.
The Delivery Office of the Trustee is 213 Market Street Harrisburg,
Pennsylvania 17101, Attention: Corporate Trust Services Department, M/C
#001-01-02. Such Delivery Office is subject to change as provided in this
Indenture.
SECTION 11.04. Suspension of Mail. If because of the suspension of
delivery of first class mail or, for any other reason, the Trustee shall be
unable to mail by first class of mail any notice required to be mailed by the
provisions of this Indenture, the Trustee shall give such notice in such other
manner as in the judgment of the Trustee shall most effectively approximate
first class mailing thereof, and the giving of that notice in that manner for
all purposes of this Indenture shall be deemed to be in compliance with the
requirement for the mailing thereof. Except as otherwise provided herein, the
mailing of any notice shall be deemed complete upon deposit of that notice in
the mail and the giving of any notice by any other means of delivery shall be
deemed complete upon receipt of the notice by the delivery service.
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SECTION 11.05. Payments Due on Saturdays, Sundays and Holidays. If any
Interest Payment Date, date of maturity of any Bonds or date fixed for
redemption of any Bonds is a Saturday, Sunday or a day on which the Trustee or
any paying agent is required, authorized or not prohibited, by law (including
without limitation executive orders) to close and is closed, then payment of
interest, principal and any redemption premium need not be made by the Trustee
or any paying agent on that date, but that payment may be made on the next
succeeding Business Day on which the Trustee or any paying agent is open for
business with the same force and effect as if that payment were made on the
Interest Payment Date, date of maturity or date fixed for redemption, and no
interest shall accrue for the period after that date; provided that if the
Trustee is open for business on the applicable Interest Payment Date, date of
maturity or date fixed for redemption, it shall make any payment required
hereunder with respect to payment of interest on outstanding Bonds and payment
of principal of and premium on Bonds presented to it for payment, regardless of
whether any paying agent shall be open for business or closed on the applicable
Interest Payment Date, date of maturity or date fixed for redemption.
SECTION 11.06. Instruments of Holders. Any writing, including without
limitation any consent, request, direction, approval, objection or other
instrument or document, required under this Indenture to be executed by any
Holder may be in any number of concurrent writings of similar tenor and may be
executed by that Holder in person or by an agent or attorney appointed in
writing. Proof of (i) the execution of any such writing, (ii) the execution of
any writing appointing any agent or attorney, and (iii) the ownership of Bonds,
shall be sufficient for any of the purposes of this Indenture, if made in the
following manner, and if so made, shall be conclusive in favor of the Trustee
with regard to any action taken thereunder, namely:
(a) The fact and date of the execution by any person of any
writing may be proved by the certificate of any officer in any
jurisdiction, who has power by law to take acknowledgments within that
jurisdiction, that the person signing the writing acknowledged that
execution before that officer, or by affidavit of any witness to that
execution; and
(b) The fact of ownership of Bonds shall be proved by the
Register maintained by the Trustee.
Nothing contained herein shall be construed to limit the Trustee to the
foregoing proof, and the Trustee may accept any other evidence of the matters
stated therein which it deems to be sufficient. Any writing, including without
limitation any consent, request, direction, approval, objection or other
instrument or document, of the Holder of any Bond shall bind every future Holder
of the same Bond, with respect to anything done or suffered to be done by the
Issuer, the Trustee or the Remarketing Agent pursuant to that writing.
SECTION 11.07. Binding Effect. This Indenture shall inure to the
benefit of and shall be binding upon the Issuer and the Trustee and their
respective successors and assigns, subject, however, to the limitations
contained herein.
SECTION 11.08. Counterparts. This Indenture may be executed in any
number of counterparts, each of which shall be regarded as an original and all
of which shall constitute but one and the same instrument.
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SECTION 11.09. Governing Law. This Indenture and the Bonds shall be
deemed to be contracts made under the laws of the Commonwealth of Pennsylvania
and for all purposes shall be governed by and construed in accordance with the
laws of the Commonwealth of Pennsylvania.
(End of Article XI)
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IN WITNESS WHEREOF, the Issuer has caused this Indenture to be executed
and delivered on its behalf by one of its duly authorized officers and its
corporate seal to be hereunto affixed and attested by one of its duly authorized
officers and the Trustee has caused this Indenture to be executed and delivered
on its behalf by one of its duly authorized officers and its corporate seal to
be hereunto affixed and attested by one of its duly authorized officers all as
of the day and year first above written.
[SEAL] MONTGOMERY COUNTY INDUSTRIAL
DEVELOPMENT AUTHORITY
Attest /s/ Gerald J. Birkelbach By /s/ Sherry Horowitz
-------------------------- ---------------------------
Assistant Secretary Chairperson
[SEAL] DAUPHIN DEPOSIT BANK AND TRUST
COMPANY, as Trustee
Attest /s/ Rex. F. Hood By /s/ Bernard V. Kelly, Jr.
------------------------- ---------------------------
Authorized Signer Authorized Signer
This execution page is part of the Trust Indenture dated as of March 1,
1997 between Montgomery County Industrial Development Authority and Dauphin
Deposit Bank and Trust Company, as Trustee, providing for the issuance of
Federally Taxable Variable Rate Demand Revenue Bonds (Neose Technologies, Inc.
Project) Series B of 1997.
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