Exhibit 10.1
LOAN AGREEMENT
between
INDIANA FINANCE AUTHORITY
and
UNITED STATES STEEL CORPORATION
$88,810,000
Indiana Finance Authority
Environmental Improvement Revenue Refunding Bonds,
Series 2010 (United States Steel Corporation Project)
Dated as of May 1, 2010
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS 2
SECTION 1.01. USE OF DEFINED TERMS 2
SECTION 1.02. DEFINITIONS 2
SECTION 1.03. INTERPRETATION 4
SECTION 1.04. CAPTIONS AND HEADINGS 4
ARTICLE II. REPRESENTATIONS 5
SECTION 2.01. REPRESENTATIONS AND COVENANTS OF THE
ISSUER 5
SECTION 2.02. REPRESENTATIONS AND COVENANTS OF THE
COMPANY 5
ARTICLE III. COMPLETION OF PROJECT FACILITIES; ISSUANCE OF
THE BONDS 6
SECTION 3.01. COMPLETION OF PROJECT FACILITIES 6
SECTION 3.02. ISSUANCE OF THE BONDS; APPLICATION OF
PROCEEDS 6
SECTION 3.03. COMPANY REQUIRED TO PROVIDE ADDITIONAL
MONEYS IN EVENT MONEYS INSUFFICIENT TO
REDEEM REFUNDED BONDS 7
SECTION 3.04. INVESTMENT OF FUND MONEYS 7
SECTION 3.05. ISSUER'S FEES 8
ARTICLE IV. LOAN BY ISSUER; REPAYMENT OF THE LOAN
INCLUDING ADDITIONAL PAYMENTS 8
SECTION 4.01. LOAN OF PROCEEDS; INSTALLMENT PAYMENTS 8
SECTION 4.02. ADDITIONAL PAYMENTS 8
SECTION 4.03. DEPOSIT OF MONEYS IN BOND FUND; MONEYS
FOR PURCHASE AND REDEMPTION 9
SECTION 4.04. OBLIGATIONS UNCONDITIONAL 9
SECTION 4.05. ASSIGNMENT BY COMPANY 9
SECTION 4.06. ASSIGNMENT BY ISSUER 10
ARTICLE V. ADDITIONAL AGREEMENTS AND COVENANTS 10
SECTION 5.01. LEASE, SALE OR GRANT OF USE BY COMPANY 10
SECTION 5.02. INDEMNIFICATION OF ISSUER AND TRUSTEE 10
SECTION 5.03. COMPANY NOT TO ADVERSELY AFFECT EXCLUSION
FROM GROSS INCOME OF INTEREST ON THE BONDS 11
SECTION 5.04. COMPANY TO MAINTAIN ITS EXISTENCE;
MERGERS OR CONSOLIDATIONS 12
SECTION 5.05. REPORTS AND AUDITS 12
SECTION 5.06. INSURANCE 12
ARTICLE VI. OPTIONS; PREPAYMENT OF LOAN 12
SECTION 6.01. OPTIONS TO TERMINATE 12
SECTION 6.02. OPTION TO PREPAY UPON EXTRAORDINARY
OPTIONAL REDEMPTION UNDER THE INDENTURE 13
SECTION 6.03. ACTIONS BY ISSUER 13
SECTION 6.04. RELEASE ON EXERCISE OF OPTION TO PREPAY
LOAN 13
ARTICLE VII. EVENTS OF DEFAULT AND REMEDIES 13
SECTION 7.01. EVENTS OF DEFAULT 13
SECTION 7.02. REMEDIES ON DEFAULT 14
SECTION 7.03. NO REMEDY EXCLUSIVE 15
SECTION 7.04. AGREEMENT TO PAY FEES AND EXPENSES 15
SECTION 7.05. NO WAIVER 15
SECTION 7.06. NOTICE OF DEFAULT 15
ARTICLE VIII.MISCELLANEOUS 15
SECTION 8.01. TERM OF AGREEMENT 15
SECTION 8.02. AMOUNTS REMAINING IN FUNDS 16
SECTION 8.03. NOTICES 16
SECTION 8.04. EXTENT OF COVENANTS OF ISSUER; NO
PERSONAL LIABILITY 16
SECTION 8.05. BINDING EFFECT 16
SECTION 8.06. AMENDMENTS AND SUPPLEMENTS 16
SECTION 8.07. EXECUTION COUNTERPARTS 16
SECTION 8.08. SEVERABILITY 17
SECTION 8.09. GOVERNING LAW 17
SECTION 8.10. FURTHER ASSURANCES AND CORRECTIVE
INSTRUMENTS 17
SECTION 8.11. ISSUER AND COMPANY REPRESENTATIVES 17
SECTION 8.12. IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS 17
SECTION 8.13. SECTION HEADINGS 17
LOAN AGREEMENT
THIS LOAN AGREEMENT made and entered into as of May 1, 2010,
by and between the INDIANA FINANCE AUTHORITY (the "Issuer"), a
body politic and corporate of the State of Indiana (the "State"),
exercising essential public functions, duly organized and validly
existing under and by virtue of the laws of the State of Indiana,
including specifically Indiana Code Title 4, Article 4, Chapters
10.9 and 11, as amended from time to time (the "Act"), and
UNITED STATES STEEL CORPORATION, a corporation duly organized and
existing under and pursuant to the laws of the State of Delaware,
and duly qualified to own property and transact business in the
State (the "Company"), under the following circumstances
summarized in the following recitals (capitalized terms not
defined in the recitals being used therein as defined in
Article I):
WHEREAS, the General Assembly of the State has enacted
Indiana Code Title 4, Article 4, Chapters 10.9 and 11, declaring
it to be the public policy of the State through the operations of
the Issuer to contribute toward the following: to prevent or
abate pollution, and to assist in the financing and refinancing
of projects comprised of pollution control facilities, any public
utility companies, and in furtherance of such assistance to issue
and sell revenue bonds of the Issuer; and
WHEREAS, in order to provide the funds necessary to refund
the Refunded Bonds, which were issued to refund the Prior Bonds,
the Issuer has duly authorized the issuance and sale of its
Environmental Improvement Revenue Refunding Bonds, Series 2010,
(United States Steel Corporation Project) in the aggregate
principal amount not to exceed $88,810,000 (the "Bonds") under
the Trust Indenture (the "Indenture") dated as of May 1, 2010,
between the Issuer and The Bank of New York Mellon Trust Company,
N.A., as trustee for the purposes described therein and has
determined to enter into this Agreement and secure the Bonds by
the pledge and assignment of Installment Payments to be made
hereunder; and
WHEREAS, the Company has also agreed under this Agreement to
pay, or cause to be paid, when due certain expenses and other
costs incurred by the Issuer and the Trustee in connection with
this Agreement and the issuance of the Bonds; and
WHEREAS, the Bonds are limited obligations of the Issuer
payable solely from the Pledged Receipts, as defined in the
Indenture, as hereinafter defined, and neither the principal of
the Bonds, nor the interest accruing thereon, shall ever
constitute a general indebtedness of the Issuer or an
indebtedness of the State or any political subdivision or
instrumentality thereof, within the meaning of any constitutional
or statutory provision whatsoever or shall ever constitute or
give rise to a pecuniary liability of the State or any political
subdivision or instrumentality thereof, nor will the Bonds be, or
be deemed to be, an obligation of the State or any political
subdivision or instrumentality thereof; and
WHEREAS, all acts and things have been done and performed
which are necessary to make the Bonds, when executed and
delivered by the Issuer, the legal, valid and binding limited
obligations of the Issuer in accordance with the terms thereof.
NOW, THEREFORE, for and in consideration of the premises,
the respective representations and agreements contained herein,
and othe good and valuable consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, the
parties hereto, recognizing that under the Act this Agreement
shall not in any way obligate the State or any agency or
political subdivision thereof, including, without limitation, the
Issuer, to raise any money by taxation or use other public moneys
for any purpose in relation to the Project or Project Facilities
and that neither the State nor any agency or political
subdivision thereof, including, without limitation, the Issuer,
shall pay or promise to pay any debt or meet any financial
obligation to any Person at any time in relation to the Project
or the Project Facilities, except from moneys received or to be
received under the provisions of this Agreement or derived from
the exercise of the rights of the Issuer hereunder, agree as
follows:
ARTICLE I.
DEFINITIONS
Section 1.01. Use of Defined Terms. In addition to the
words and terms defined elsewhere in this Agreement, or by
reference to another document, the words and terms set forth in
Section 1.02 shall have the meanings set forth therein unless the
content or use clearly indicates another meaning or intent. In
addition, all capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Indenture.
Section 1.02. Definitions. The following terms shall have
the following meanings:
"Additional Payments" means payments due hereunder in
addition to the Installment Payments.
"Agreement" means this Loan Agreement as amended or
supplemented from time to time.
"Bonds" means the Issuer's $88,810,000 Environmental
Improvement Revenue Refunding Bonds, Series 2010 (United States
Steel Corporation Project).
"Event of Default" means any of the events described as an
Event of Default in Section 7.01.
"Indenture" has the meaning set forth in the recitals to
this Agreement.
"Issuer" has the meaning set forth in the first paragraph of
this Agreement.
"Loan" means the loan of Bond proceeds from the Issuer to
the Company as provided in Section 4.01.
"Notice Address" means:
(a) As to the Issuer:
Indiana Finance Authority
One North Capitol Avenue, Suite 900
Indianapolis, Indiana 46204
Attention: Public Finance Director
Facsimile: (317) 232-6786
(b) As to the Company:
United States Steel Corporation
Room 1311
600 Grant Street
Pittsburgh, PA 15219-4776
Attention: Assistant Treasurer-Finance and Risk
Management
Facsimile No.: (412) 433-4765
(c) As to the Trustee:
The Bank of New York Mellon Trust Company, N.A.
525 William Penn Place
7th Floor
Pittsburgh, PA 15259
Attention: Corporate Trust Administration
Facsimile No.: (412) 236-0870
or such additional or different address, notice of which is given
under Section 8.03.
"Person" or words importing persons mean any individual,
corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Prior Bonds" means the City of Gary, Indiana Environmental
Improvement Revenue Bonds, Series 1977 (United States Steel
Corporation Gary Project), the City of Gary, Indiana,
Environmental Improvement Revenue Bonds, Series 1978 (United
States Steel Corporation Gary Project), the City of Gary,
Indiana, Environmental Improvement Revenue Bonds, Series 1979
(United States Steel Corporation Gary Project) and the City of
Gary, Indiana Customized Purchase Environmental Improvement
Revenue Refunding Bonds (United States Steel Corporation Project)
Series 1986.
"Project" means the refinancing of the cost of the Project
Facilities through the current refunding of the Refunded Bonds,
as defined in the recitals to this Agreement.
"Project Facilities" means, generally, the pollution control
facilities financed or refinanced from the proceeds of Prior
Bonds and the Refunded Bonds, described in Exhibit A hereto, and
may also be limited, when appropriate in the context, to those
specific capital assets and equipment remaining in the ownership
of the Company and in the physical state, condition and manner of
operation existing on the date of issuance of the Bonds.
"Refunded Bonds" means the Indiana Development Finance
Authority Environmental Improvement Revenue Bonds (USX
Corporation Projects) Refunding Series of 1996 currently
outstanding in the aggregate principal amount of $41,810,000 and
the Indiana Development Finance Authority Environmental
Improvement Revenue Bonds (USX Corporation Projects) Refunding
Series of 1998 currently outstanding in the aggregate principal
amount of $47,000,000.
"Refunded Bonds Trustee" means The Bank of New York Mellon
Trust Company, N.A., in its capacity as trustee or successor
trustee for each issue of the Refunded Bonds.
"Tax Certificates" means the Tax Representation Certificate
of the Company and the Arbitrage Certificate of the Issuer with
respect to the Bonds.
"1998 Bonds" means the Indiana Development Finance Authority
Environmental Improvement Revenue Bonds (USX Corporation
Projects) Refunding Series of 1998 currently outstanding in the
aggregate principal amount of $47,000,000.
All other terms used in this Agreement that are defined in
the Indenture have the same meanings assigned them in the
Indenture unless the context clearly requires otherwise.
Section 1.03. Interpretation. Unless the context clearly
indicates otherwise, the capitalized terms defined in this
Article I and in the Indenture, for all purposes of this
Agreement and all agreements supplemental hereto, have the
meanings hereby ascribed to them. Such terms, together with all
other provisions of this Agreement, shall be read and understood
in a manner consistent with the provisions of the Act. Words or
phrases importing the masculine gender shall be read and
understood to include the feminine and neuter genders and those
importing number shall include singular or plural, both as
appropriate to the context.
Any reference herein to the Issuer, to its board or to any
designated officer includes entities or officials succeeding to
their respective functions, duties or responsibilities pursuant
to or by operation of law or lawfully performing their functions.
Any reference to a section, provision or chapter of the laws
of the State or to any statute of the United States of America
includes that section, provision or chapter or statute as
amended, modified, revised, supplemented or superseded from time
to time; provided, that no such amendment, modification or
similar change shall apply solely by reason of this provision, if
it constitutes in any way an impairment of the rights or
obligations of the Issuer, the Bondholders, the Trustee or the
Company under this Agreement.
Section 1.04. Captions and Headings. The captions and
headings in this Agreement are solely for convenience of
reference and in no way define, limit or describe the scope or
intent of any articles, sections, subsections, paragraphs,
subparagraphs or clauses hereof.
ARTICLE II.
REPRESENTATIONS
Section 2.01. Representations and Covenants of the Issuer.
The Issuer represents that (a) it is duly organized and validly
existing under the Constitution and laws of the State, including
the Act; (b) it has duly accomplished all conditions necessary to
be accomplished by it prior to the issuance and delivery of the
Bonds and the execution and delivery of this Agreement, the
Indenture and the Tax Certificates (as applicable); (c) it is not
in violation of or in conflict with any provisions of the laws of
the State which would impair its ability to carry out its
obligations contained in this Agreement, the Indenture or the Tax
Certificates (as applicable); (d) it is empowered to enter into
the transactions contemplated by this Agreement, the Indenture
and the Tax Certificates (as applicable); (e) it has duly
authorized the execution, delivery and performance of this
Agreement, the Indenture and the Tax Certificates (as
applicable); (f) to the best of its knowledge and belief, based
upon the application submitted by the Company, and other
representations made, information presented and testimony given
by the Company, the Bonds will further the public purposes of the
Act and of the Issuer; and (g) it will do all things in its power
in order to maintain its existence or assure the assumption of
its obligations under this Agreement, the Indenture and the Tax
Certificates (as applicable) by any successor public body.
Section 2.02. Representations and Covenants of the Company.
The Company represents and covenants that:
(a) It is a corporation duly organized and existing under and
pursuant to the laws of the State of Delaware. The Company is
qualified to do business in the State.
(b) It has full power and authority to execute, deliver and
perform its obligations under this Agreement and the Tax
Certificates (as applicable) and to enter into and carry out the
transactions contemplated by those documents; such execution,
delivery and performance does not, and will not, violate any
provision of law applicable to the Company or the Company's
articles of incorporation, code of regulations, bylaws or other
corporate charter or similar instrument each as may be amended,
and does not, and will not, conflict with or result in a default
under any agreement or instrument to which the Company is a party
or by which it is bound; this Agreement and the Tax Certificates
have, by proper action, been duly authorized, executed and
delivered by the Company and all steps necessary have been taken
to constitute this Agreement and the Tax Certificates valid and
binding obligations of the Company.
(c) Each of the Project Facilities was, at the time originally
placed in service, a "pollution control facility" used in whole
or in part to control, reduce, abate or prevent, air, noise,
water or general environmental pollution, and was designed to
meet applicable federal, state and local requirements for the
control of air or water pollution in effect at or about the time
the Prior Bonds were issued. The Project Facilities were
constructed for no significant purpose other than the control of
air or water pollution, and not principally designed to result in
any increase in production or capacity, or in a material
extension of the useful life of a manufacturing or production
facility or a part thereof that is owned, operated or used by the
Company.
(d) At the time of issuance of the Prior Bonds, at the time of
issuance of the Refunded Bonds and at all times subsequent
thereto, the Company has complied with all applicable
requirements of the Internal Revenue Code of 1954, as amended,
the Internal Revenue Code of 1986, as amended, and all applicable
regulations, rulings and successor laws necessary to ensure the
continuing tax-exempt status of such Prior Bonds and of the
Refunded Bonds, with the exception of any such requirements
related to the maturity of the 1998 Bonds that were the subject
of an irrevocable notice of redemption dated December 22, 2009.
(e) All of the proceeds of the Bonds will be used exclusively to
retire the Refunded Bonds within 90 days of the date of issuance
of the Bonds. None of the proceeds of the Bonds will be used to
provide working capital or pay costs of issuance of the Bonds.
(f) Each one and all of the representations and warranties of
the Company contained in the Tax Certificates, as executed and
delivered simultaneously with this Agreement, are true and
correct.
(g) The Company will comply with the applicable requirements of
Rule 15c2-12 as promulgated by the Securities and Exchange
Commission and recognizes that the Issuer is not an "obligated
person" within the meaning of said Rule.
ARTICLE III.
COMPLETION OF PROJECT FACILITIES;
ISSUANCE OF THE BONDS
Section 3.01. Completion of Project Facilities. The
Company represents thatthe acquisition and/or construction of
the Project Facilities have been completed and that the proceeds
derived from the sale of the Prior Bonds and the Refunded Bonds
used to refund the Prior Bonds, including any investment thereof,
were expended in accordance with the provisions of all bond
authorization, security and tax regulatory agreements and/or
certificates executed in respect of all such bonds, including the
Refunded Bonds, and in respect of the installation, operation or
use of the Project Facilities and the refunding of the Prior
Bonds.
Section 3.02. Issuance of the Bonds; Application of
Proceeds. To provide funds for the purpose of refunding the
Refunded Bonds, the Issuer will issue, sell and deliver the
Bonds. The Bonds will be issued in accordance with and pursuant
to the Indenture in the aggregate principal amount, will bear
interest at the rate or rates, will mature and will be subject to
redemption as set forth therein. The Company hereby approves the
terms and conditions of the Indenture, and the Bonds, and the
terms and conditions under which the Bonds will be issued, sold
and delivered.
The proceeds from the sale of the Bonds shall be paid to the
Trustee and deposited as follows (a) a sum equal to accrued
interest, if any, shall be deposited in the Bond Fund and (b) the
balance shall be deposited in the Clearing Fund.
Disbursements of moneys in the Clearing Fund shall be made
by the Trustee in order to defease and/or redeem the Refunded
Bonds, pursuant to written instructions delivered by the Company
to the Trustee and to the Refunded Bonds Trustee, provided, in
all events, all moneys in the Clearing Fund shall be fully
disbursed for the redemption of the Refunded Bonds on or before
90 days following the date of issuance of the Bonds. Upon
deposit of adequate funds with the trustee for the Refunded
Bonds, the Company shall be permitted to seek a release of the
lien of any and all documents providing for the payment of the
Refunded Bonds, including particularly the respective Trust
Indentures and the Loan Agreements securing the same, and may
seek repayment of any unrequired funds on deposit in the Clearing
Fund, pursuant to Section 5.07 of the Indenture.
Section 3.03. Company Required to Provide Additional
Moneys in Event Moneys Insufficient to Redeem Refunded Bonds. If
moneys disbursed from the Clearing Fund to the Refunded Bonds
Trustee are not sufficient to defease or redeem an issue of the
Refunded Bonds, the Company shall, nonetheless, not later than the
date fixed for redemption of such issue of Refunded Bonds, pay to
the Refunded Bonds Trustee, in immediately available funds, any such
additional moneys as shall be needed, including, without
limitation, amounts for interest accrued to that date, from its
own funds to defease or redeem such issue of the Refunded Bonds.
The Company shall not be entitled to any reimbursement therefor
from the Issuer, the Trustee or any Holder; nor shall it be
entitled to any abatement, diminution or postponement of the
Installment Payments as a consequence of such payment. The
Company acknowledges and agrees that there is no implied or
express warranty by the Issuer that the proceeds of the Bonds
will be sufficient to redeem the Refunded Bonds.
Section 3.04. Investment of Fund Moneys. At the written
direction of the Authorized Company Representative, any moneys
held as part of the Trust Estate shall be invested or reinvested
by the Trustee in Eligible Investments. Each of the Issuer and
the Company hereby covenants that it will restrict any investment
and reinvestment and the use of the proceeds of the Bonds in such
manner and to such extent, if any, as may be necessary so that
the Bonds will not constitute arbitrage bonds under Section 148
of the Code.
The Company shall provide the Issuer with a certificate of
an appropriate officer, employee or agent of or consultant to the
Company for inclusion in the transcript of proceedings for the
Bonds, setting forth the reasonable expectations of the Company
on the date of delivery of and payment for the Bonds regarding
the amount and use of the proceeds of the Bonds and the facts,
estimates and circumstances on which those expectations are
based.
The Company agrees that at no time shall any funds
constituting gross proceeds of the Bonds be issued in any manner
to cause or result in a prohibited payment under applicable
regulations pertaining to, or in any other fashion as would
constitute failure of compliance with, Section 148 of the Code.
If there is any amount required to be paid to the
United States pursuant to Section 148(f) of the Code or
Section 5.03 of the Indenture, the Company shall pay such amount
to the Trustee for deposit to the Rebate Fund created under
Section 5.03 of the Indenture, who will submit the payment to the
United States.
Section 3.05. Issuer's Fees. The Company will pay the
Issuer's closing fee in the amount of $30,000 and the legal fee
in the amount of $5,000 on the date of issuance of the Bonds. The
Company will also pay any other administrative expenses incurred
in connection with the refinancing of the Refunded Bonds, and any
such additional fees and expenses (including reasonable
attorney's fees) incurred by the Issuer or the Trustee in
connection with inquiring into, or enforcing, the performance of
the Company's obligations hereunder, within 30 days of receipt of
a statement from the Issuer requesting payment of such amount.
ARTICLE IV.
LOAN BY ISSUER; REPAYMENT OF THE LOAN
INCLUDING ADDITIONAL PAYMENTS
Section 4.01. Loan of Proceeds; Installment Payments.
The Issuer agrees, upon the terms and conditions contained in this
Agreement, to lend to the Company the proceeds received by the
Issuer from the sale of the Bonds. Such proceeds shall be
disbursed to or on behalf of the Company as provided in
Section 3.02.
On each date on which any payment of principal of or
interest on Bonds shall become due (whether at maturity, or upon
redemption or acceleration or otherwise), the Company will pay or
cause to be paid to the Trustee, in immediately available funds,
an amount which, together with other moneys held by the Trustee
under the Indenture and available therefor, will enable the
Trustee to make such payment in full in a timely manner
("Installment Payments").
In furtherance of the foregoing, so long as any Bonds are
outstanding, the Company will pay or cause to be paid all amounts
required to prevent any deficiency or default in any payment with
respect to the Bonds, including any deficiency caused by an act
or failure to act by the Trustee, the Company, the Issuer or any
other Person.
The Issuer assigns all amounts payable under this Section by
the Company to the Trustee pursuant to the Indenture for the
benefit of the Bondholders. The Company assents to such
assignment. Accordingly, the Company will pay directly to the
Trustee at its designated office all payments payable by the
Company pursuant to this Section.
Section 4.02. Additional Payments. The Company will also
pay the following upon demand after receipt of a bill therefor:
(a) The reasonable and documented out-of-pocket fees and
expenses, including reasonable attorneys' fees, of the Issuer
incurred in connection with this Agreement, the Indenture, the
Tax Certificates and the Bonds, and the making of any amendment
or supplement thereto, including, but not limited to: (i) those
described in Section 3.05 (which includes, among other fees and
expenses, the fees and expenses associated with the initial
drafting, execution and delivery of this Agreement, the Tax
Certificates and the Bonds), (ii) those described in Section 7.04
and (iii) any other payments or indemnification required under
Section 5.02.
(b) The fees and expenses of the Trustee under the Indenture,
including reasonable attorneys' fees of the Trustee for any
services rendered by them under the Indenture, including those
described in Section 7.04, and any other payments or
indemnification required under Section 5.02, such fees, expenses
and payments to be paid directly to the Trustee for its own
account as and when such fees and expenses become due and
payable.
The Company further agrees to pay all reasonable and
documented out-of-pocket costs and expenses (including reasonable
attorney's fees and expenses) of the Issuer incurred after the
initial issuance of the Bonds in the preparation of any
responses, reproduction of any documentation or participation in
any inquiries, investigations or audits from any Person solely or
primarily in connection with the Bonds, including without
limitation, the Internal Revenue Service, the Securities Exchange
Commission or other governmental agency.
Section 4.03. Deposit of Moneys in Bond Fund; Moneys for
Purchase and Redemption. The Company may at any time deposit
moneys in the Bond Fund, without premium or penalty, to be held
by the Trustee for application to Installment Payments not yet
due and payable, and the Issuer agrees that the Trustee shall
accept such deposits when tendered by the Company. Such deposits
shall be credited against the Installment Payments, or any
portion thereof, in the order of their due dates. In addition,
the Company may at any time deliver moneys to the Trustee in
addition to such deposits with written instructions to the
Trustee to use such moneys for the purpose of making open market
purchases of Bonds. Such deposits or such delivery of moneys for
Bond purchases shall not in any way alter or suspend the
obligations of the Company under this Agreement during the term
hereof as provided in Section 8.01.
In addition, the Company may deliver moneys to the Trustee
for use for optional redemption of Bonds pursuant to
Sections 6.01 and 6.02 and shall deliver moneys to the Trustee
for mandatory redemption of Bonds as required by
Section 4.02(b)(ii) of the Indenture.
Section 4.04. Obligations Unconditional. The obligations
of the Company to make payments required by Sections 4.01, 4.02
and 4.03 of this Agreement and to perform its other agreements
contained herein shall be absolute and unconditional, and the
Company shall make such payments without abatement, diminution or
deduction regardless of any cause or circumstances whatsoever.
Section 4.05. Assignment by Company. Rights granted to the
Company under this Agreement may be assigned in whole or in part
by the Company without the necessity of obtaining the consent of
the Issuer or the Trustee, subject, however, to each of the
following conditions:
(a) unless waived by the Issuer or the Trustee, the Company
shall notify the Issuer and the Trustee in writing of the
identity of any assignee at least 30 days prior to the effective
date of such assignment;
(b) no assignment shall relieve the Company from primary
liability hereunder for its obligations hereunder, and the
Company shall continue to remain primarily liable for the payment
of the Installment Payments and Additional Payments and for
performance and observance of the agreements on its part herein
provided to be performed and observed by it;
(c) any assignment from the Company must retain for the Company
such rights and interests as will permit it to perform its
obligations under this Agreement;
(d) the Company shall, within 30 days after execution thereof,
furnish or cause to be furnished to the Issuer and the Trustee a
true and complete copy of each such assignment; and
(e) any assignment from the Company shall not materially impair
fulfillment of the purposes to be accomplished by operation of
the Project Facilities as a project, the financing of which is
permitted under the Act.
Section 4.06. Assignment by Issuer. The Issuer will assign
its rights under and interest to this Agreement (except for
Unassigned Issuer Rights) to the Trustee pursuant to the
Indenture as security for the payment of the Bonds. Otherwise,
the Issuer will not sell, assign or otherwise dispose of its
rights under or interest in this Agreement nor create or permit
to exist any lien, encumbrance or security interest thereon.
ARTICLE V.
ADDITIONAL AGREEMENTS AND COVENANTS
Section 5.01. Lease, Sale or Grant of Use by Company.
Subject to the provisions of Section 5.03, the Company may lease,
sell or grant the right to occupy and use the remaining Project
Facilities, in whole or in part, to others, provided that:
(a) no such grant, sale or lease shall relieve the Company from
its obligations under this Agreement;
(b) the Company shall retain such rights and interests as will
permit it to comply with its obligations under this Agreement;
(c) no such grant, sale or lease shall impair the purposes of
the Act; and
(d) the Company shall receive an opinion of Nationally
Recognized Bond Counsel that such grant, sale or lease does not
have an adverse affect upon the tax-exempt status of the Bonds.
Section 5.02. Indemnification of Issuer and Trustee. The
Company will indemnify and hold the Issuer and Trustee, their
members, officers and employees, and the State of Indiana,
including its members, officers and employees, free and harmless
from any loss, claim, damage, tax, penalty, liability,
disbursement, litigation expenses, attorneys'fees and expenses
or court costs arising out of, or in any way relating to, the
execution or performance of the Indenture, this Agreement, the
Bond Purchase Agreement (the "Bond Purchase Agreement") among
Morgan Stanley & Co. Incorporated, the Issuer and the Company or
any other documents in connection therewith, or any other cause
whatsoever pertaining to the Project Facilities (including
without limitation any loss, claim, damage, tax penalty,
liability, disbursement, litigation expenses, attorneys' fees and
expenses or court costs asserted or arising under any federal,
state or local statute, law, ordinance, code, rule, regulation,
order or decree regulating or relating to or imposing liability
or standards of conduct concerning any hazardous, toxic or
dangerous waste, substance or material), or the Bonds, including
the issuance or sale of the Bonds, or failure to issue or sell
the Bonds, actions taken under the Bonds, the Indenture, this
Agreement, the Bond Purchase Agreement or any other documents in
connection therewith or any other cause whatsoever pertaining to
the Project Facilities, except in any case as a result of the
gross negligence or willful misconduct of the Issuer or Trustee.
The Company may, at its cost and in its name or in the name
of the Issuer, prosecute or take any other action involving third
persons which the Company deems necessary in order to ensure or
protect the Company's rights under this Agreement; in such event,
the Issuer will reasonably cooperate with the Company, but at the
sole expense of the Company.
In case any actions or proceedings are brought against the
Issuer or the Trustee in respect of which indemnity may be sought
hereunder, the party seeking indemnity shall promptly (but in any
event within 15 days of receipt of service) give notice of that
action or proceeding to the Company enclosing copies of all
papers served, and the Company upon receipt of that notice shall
have the obligation and the right to assume the defense of the
action or proceeding; provided, that failure of a party to give
that notice shall not relieve the Company from any of its
obligations under this Section unless that failure materially
prejudices the defense of the action or proceeding by the
Company. At its own expense, an indemnified party may employ
separate counsel and participate in the defense. The Company
shall not be liable for any settlement made without its consent.
Notwithstanding anything contained herein to the contrary,
the Company shall not be obligated to indemnify or hold harmless
the Issuer or the Trustee for their gross negligence or willful
misconduct.
The foregoing indemnification is intended to and shall
include the indemnification of all affected officials, directors,
trustees, officers and employees of the Issuer and the Trustee,
respectively. That indemnification is intended to and shall be
enforceable by the Issuer and the Trustee, respectively, to the
full extent permitted by law.
Section 5.03. Company Not to Adversely Affect Exclusion
From Gross Income of Interest on the Bonds. The Company hereby
represents that it has taken and caused to be taken, and
covenants that it will take and cause to be taken, all actions
that may be required of it, alone or in conjunction with the
Issuer, for the interest on the Bonds to be and to remain
excludable from gross income for federal income tax purposes, and
represents that it has not taken or permitted to be taken on its
behalf, and covenants that it will not take or permit to be taken
on its behalf, any action that would adversely affect such
excludability under the provisions of the Code.
The Company also covenants that it will restrict the
investment and reinvestment and the use of the proceeds of the
Bonds in such manner and to such extent, if any, as may be
necessary so that the Bonds will not constitute arbitrage bonds
under Section 148 of the Code.
The Company hereby covenants that on or before the ninetieth
day following the date any of the Project Facilities are no
longer being operated as qualifying exempt facilities under the
Code (unless such facilities have simply ceased to be operated),
or such later date as provided in the Indenture, the Company
shall cause a related amount of Bonds to be redeemed pursuant to
the Mandatory Redemption provision of the Bonds.
Section 5.04. Company to Maintain its Existence; Mergers or
Consolidations. The Company covenants that it will not merge or
consolidate with any other legal entity or sell or convey all or
substantially all of its assets to any other legal entity, except
that the Company may merge or consolidate with, or sell or convey
all or substantially all of its assets to any other legal entity,
provided that (a) the Company shall be the continuing legal
entity or the successor legal entity (if other than the Company)
shall be a legal entity organized and existing under the laws of
the United States of America or a state thereof, qualified to do
business in the State of Indiana and such legal entity shall
expressly assume the due and punctual payment of the Installment
Payments hereunder in order to ensure timely and proper payment
of the principal of and interest on all the Bonds, according to
their tenor, and the due and punctual performance and observance
of all the covenants and conditions of this Agreement to be
performed by the Company and (b) the Company or such successor
legal entity, as the case may be, shall not, immediately after
such merger or consolidation, or such sale or conveyance, be in
default in the performance of any such covenant or condition and
no event which with the lapse of time, the giving of notice or
both would constitute an Event of Default under Section 7.01
shall have occurred and be continuing.
In case any such consolidation, merger, sale or conveyance
and upon the assumption by the successor legal entity of the
obligations under this Agreement and on the Bonds in accordance
with the foregoing, such successor legal entity shall succeed to
and be substituted for the Company, with the same effect as if it
had been named herein as a party hereto, and the Company shall
thereupon be relieved of any further obligations or liabilities
hereunder and upon the Bonds and the Company as the predecessor
legal entity may thereupon or at any time thereafter be
dissolved, wound-up or liquidated.
Section 5.05. Reports and Audits. The Company shall as
soon as practicable but in no event later than six months after
the end of each of its fiscal years, file with the Trustee and
the Issuer, audited financial statements of the Company prepared
as of the end of such fiscal year; provided that the Company may
satisfy this requirement by its filing of such information with
the Securities and Exchange Commission (www.sec.gov) and the
Municipal Securities Rulemaking Board (www.emma.msrb.org) in
accordance with their respective filing requirements.
Section 5.06. Insurance. The Company shall maintain, or
cause to be maintained, insurance covering such risks and in such
amounts as is customarily carried by similar industries as the
Company, and which insurance may be, in whole or in part, self-
insurance.
ARTICLE VI.
OPTIONS; PREPAYMENT OF LOAN
Section 6.01. Options to Terminate. The Company shall
have, and is hereby granted, an option to prepay and terminate
the Loan, upon satisfaction of the following conditions at any
time prior to full payment of the Bonds (or provision for payment
thereof having been made in accordance with the provisions of the
Indenture): (a) in accordance with Article IX of the Indenture,
by paying to the Trustee an amount which, when added to the
amount on deposit in the funds established under the Indenture
and available therefor, will be sufficient to pay, retire and,
pursuant to the Indenture, redeem all the outstanding Bonds in
accordance with the provisions of the Indenture (including,
without limiting the generality of the foregoing, principal of
and interest to maturity or the earliest applicable redemption
date, as the case may be, and expenses of redemption and the
Trustee's fees and expenses due hereunder or under the
Indenture), and in case of redemption making arrangements
satisfactory to the Trustee for the giving of the required notice
of redemption, (b) by giving the Issuer notice in writing of such
termination and (c) by making full payment of Additional Payments
due under Section 4.02; thereafter such termination shall
forthwith become effective.
Any prepayment pursuant to this Section 6.01 shall either
comply with the provisions of Article IX of the Indenture or
result in redemption of the Bonds within 90 days of the date of
prepayment. Nothing contained in this Section 6.01 shall prevent
the payment of part of any of the Bonds pursuant to Article IV or
Section 9.02 of the Indenture.
Section 6.02. Option to Prepay Upon Extraordinary Optional
Redemption Under the Indenture. The Company shall also have the
option, upon the occurrence of certain extraordinary
circumstances described therein, to prepay the loan in whole or
in part upon the terms and conditions set forth in
Section 4.02(b)(i) of the Indenture.
Section 6.03. Actions by Issuer. At the request of the
Company or the Trustee, the Issuer shall take all steps required
of it under the applicable provisions of the Indenture or the
Bonds to effect the redemption of all or a portion of the Bonds
pursuant to this Article VI; provided that, in such event, the
Company shall reimburse the Issuer for its reasonable expenses,
including attorneys' fees, incurred in complying with such
request.
Section 6.04. Release on Exercise of Option to Prepay Loan.
Upon the payment of all amounts due hereunder pursuant to any
option to prepay the loan granted in this Agreement, the Issuer
shall upon receipt of the prepayment, deliver to the Company, if
necessary, a release from the Trustee of the lien of the
Indenture.
ARTICLE VII.
EVENTS OF DEFAULT AND REMEDIES
Section 7.01. Events of Default. Each of the following
shall be an Event of Default:
(a) The Company shall fail to pay the amounts required to be
paid under Section 4.01 or 4.02 on the date specified therein.
(b) Failure by the Company to observe and perform any covenant,
condition or agreement on its part to be observed or performed,
other than as referred to in Section 7.01(a), (other than certain
representations, warranties and covenants regarding various
matters relating to the tax status of the Bonds) for a period of
60 days after written notice specifying such failure and
requesting that it be remedied shall have been given to the
Company by the Issuer or the Trustee, unless the Issuer and the
Trustee shall agree in writing to an extension of such time prior
to its expiration; provided, however, if the failure stated in
the notice cannot be corrected within the applicable period, it
shall not constitute an Event of Default if corrective action is
instituted by the Company within the applicable period and is
being diligently pursued until the default is corrected.
(c) The dissolution or liquidation of the Company or the
voluntary initiation by the Company of any proceeding under any
federal or state law relating to bankruptcy, insolvency,
arrangement, reorganization, readjustment of debt or any other
form of debtor relief, or the initiation against the Company of
any such proceeding which shall remain undismissed for 60 days,
or failure by the Company to promptly have discharged any
execution, garnishment or attachment of such consequence as would
materially impair the ability of the Company to carry on its
operations, or assignment by the Company for the benefit of
creditors, or the entry by the Company into an agreement of
composition with creditors or the failure generally by the
Company to pay its debts as they become due.
(d) The occurrence of an Event of Default as defined in the
Indenture.
Any declaration of default under subparagraph (c) and the
exercise of remedies upon any such declaration will be subject to
any applicable limitations of federal bankruptcy law affecting or
precluding that declaration or exercise during the pendency of or
immediately following any bankruptcy, liquidation or
reorganization proceedings.
Section 7.02. Remedies on Default. Whenever an Event of
Default shall have happened and be existing, any one or more of
the following remedial steps may be taken:
(a) if acceleration of the principal amount of the Bonds has
been declared pursuant to Section 7.03 of the Indenture, the
Trustee shall declare all Installment Payments to be immediately
due and payable, whereupon the same shall become immediately due
and payable; or
(b) the Issuer or the Trustee may pursue all remedies now or
hereafter existing at law or in equity to collect all amounts
then due and thereafter to become due under this Agreement or to
enforce the performance and observance of any other obligation or
agreement of the Company under those instruments.
Notwithstanding the foregoing, the Trustee shall not be
obligated to take any step that in its reasonable opinion will or
might cause it to expend time or money or otherwise incur
liability unless and until a satisfactory indemnity bond has been
furnished to the Trustee at no cost or expense to it. Any
amounts collected pursuant to action taken under this Section
(except for amounts payable directly to the Issuer or the Trustee
pursuant to Section 4.02, 5.02 or 7.04) shall be paid into the
Bond Fund and applied in accordance with the provisions of the
Indenture or, if the Outstanding Bonds have been paid and
discharged in accordance with the provisions of the Indenture,
shall be paid as provided in Section 9.01 of the Indenture for
transfers of remaining amounts in the Bond Fund.
The provisions of this Section are subject to the further
limitation that the rescission by the Trustee of its declaration
that all of the Bonds are immediately due and payable also shall
constitute an annulment of any corresponding declaration made
pursuant to paragraph (a) of this Section and a waiver and
rescission of the consequences of that declaration and of the
Event of Default with respect to which that declaration has been
made, provided that no such waiver or rescission shall extend to
or affect any subsequent or other default or impair any right
consequent thereon.
Section 7.03. No Remedy Exclusive. No remedy conferred
upon or reserved to the Issuer or the Trustee by this Agreement
is intended to be exclusive of any other available remedy or
remedies, but each and every remedy shall be cumulative and shall
be in addition to every other remedy given under this Agreement,
now or hereafter existing at law, in equity or by statute. No
delay or omission to exercise any right or power accruing upon
any default shall impair that right or power or shall be
construed to be a waiver thereof, but any such right and power
may be exercised from time to time and as often as may be deemed
expedient. In order to entitle the Issuer or the Trustee to
exercise any remedy reserved to it in this Article, it shall not
be necessary to give any notice, other than any notice required
by law or for which express provision is made herein.
Section 7.04. Agreement to Pay Fees and Expenses. If an
Event of Default should occur and the Issuer or the Trustee
should incur expenses, including attorneys' fees, in connection
with the enforcement of this Agreement or the collection of sums
due thereunder, the Company shall reimburse the Issuer and the
Trustee, as applicable, from the reasonable expenses so incurred
upon demand.
Section 7.05. No Waiver. No failure by the Issuer or the
Trustee to insist upon the performance by the Company of any
provision hereof shall constitute a waiver of their right to
performance and no express waiver shall be deemed to apply to any
other existing or subsequent right to remedy the failure by the
Company to observe or comply with any provision hereof.
Section 7.06. Notice of Default. The Company shall notify
the Trustee immediately and in writing if it becomes aware of the
occurrence of any Event of Default hereunder or of any fact,
condition or event which, with the giving of notice or passage of
time or both, would become an Event of Default.
ARTICLE VIII.
MISCELLANEOUS
Section 8.01. Term of Agreement. This Agreement shall be
and remain in full force and effect from the date of issuance of
the Bonds until such time as all of the Bonds shall have been
fully paid (or provision made for such payment) pursuant to the
Indenture and all other sums payable by the Company under this
Agreement shall have been paid, except for obligations of the
Company under Section 4.02, 5.02 and 7.04, which shall survive
any termination of this Agreement.
Notwithstanding any termination of this Agreement, any
payment of any or all of the Bonds or any discharge of the
Indenture, if Bonds are redeemed pursuant to the mandatory
redemption upon determination of taxability, the Company shall
pay all additional amounts required to be paid under Section 4.01
of the Indenture at the time provided therein.
Section 8.02. Amounts Remaining in Funds. Any amounts in
the Bond Fund remaining unclaimed by the Holders of Bonds
(whether at stated maturity, by redemption or pursuant to any
mandatory sinking fund requirements or otherwise), shall be
deemed to belong to and shall be paid, to the proper party
pursuant to applicable escheat laws. Further, any other amounts
remaining in the Bond Fund, the Clearing Fund and any other
special fund for accounts created under this Agreement or the
Indenture after all of the outstanding Bonds shall be deemed to
have been paid and discharged under the provisions of the
Indenture and all other amounts required to be paid under this
Agreement and the Indenture have been paid, shall be paid to the
Company to the extent that those moneys are in excess of the
amounts necessary to effect the payment and discharge of the
outstanding Bonds.
Section 8.03. Notices. All notices, certificates, requests
or other communications hereunder shall be in writing and shall
be deemed to be sufficiently given when received or upon refusal
of delivery at the applicable Notice Address. The Issuer, the
Company or the Trustee may, by providing written notice to each
other, designate any further or different addresses to which
subsequent notices, certificates, requests or other
communications shall be sent.
Section 8.04. Extent of Covenants of Issuer; No Personal
Liability. All covenants, obligations and agreements of the
Issuer contained in this Agreement or the Indenture shall be
effective to the extent authorized and permitted by applicable
law. No such covenant, obligation or agreement shall be deemed
to be a covenant, obligation or agreement of any present or
future member, trustee, officer, agent or employee of the Issuer
in other than his official capacity, and no official executing
the Bonds shall be liable personally on the Bonds or be subject
to any personal liability or accountability by reason of the
issuance thereof or by reason of the covenants, obligations or
agreements of the Issuer contained in this Agreement or in the
Indenture.
Section 8.05. Binding Effect. This Agreement shall inure
to the benefit of and shall be binding in accordance with its
terms upon the Issuer, the Company and their respective permitted
successors and assigns.
Section 8.06. Amendments and Supplements. Except as
otherwise expressly provided in this Agreement or the Indenture,
subsequent to the issuance of the Bonds and prior to all
conditions provided for in the Indenture for release of the
Indenture having been met, this Agreement may not be effectively
amended, changed, modified, altered or terminated except in
accordance with the provisions of Article XI of the Indenture, as
applicable.
Section 8.07. Execution Counterparts. This Agreement 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.
Section 8.08. Severability. If any provision of this
Agreement, or any covenant, obligation or agreement contained
herein is determined by a court to be invalid or unenforceable,
that determination shall not affect any other provision,
covenant, obligation or agreement, each of which shall be
construed and enforced as if the invalid or unenforceable portion
were not contained herein. That invalidity or unenforceability
shall not affect any valid and enforceable application thereof,
and each such provision, covenant, obligation or agreement shall
be deemed to be effective, operative, made, entered into or taken
in the manner and to the full extent permitted by law.
Section 8.09. Governing Law. This Agreement shall be
deemed to be a contract made under the laws of the State and for
all purposes shall be governed by and construed in accordance
with the laws of the State.
Section 8.10. Further Assurances and Corrective
Instruments. The Issuer and the Company agree that they will,
from time to time, execute, acknowledge and deliver, or cause to
be executed, acknowledged and delivered, such supplements hereto
and such further instruments as may reasonably be required for
the further assurance, correction or performance of the expressed
intention of this Agreement.
Section 8.11. Issuer and Company Representatives. Whenever
under the provisions of this Agreement the approval of the Issuer
or the Company is required or the Issuer or the Company is
required to take some action at the request of the other, such
approval or such request shall be given for the Issuer by a
Designated Officer and for the Company by an Authorized Company
Representative. The Trustee shall be authorized to act on any
such approval or request.
Section 8.12. Immunity of Incorporators, Stockholders,
Officers and Directors. No recourse under or upon any
obligation, covenants or agreement contained in this Agreement or
in any agreement supplemental hereto, or in the Bonds, or because
of any indebtedness evidenced thereby, shall be had against any
incorporator, or against any stockholder, member, officer or
director, as such, past, present or future, of the Company or of
any predecessor or, subject to Section 5.04 hereof, successor
legal entity, either directly or through the Company or any
predecessor or successor legal entity, under any rule of law,
statute or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise,
all such liability being expressly waived and released by the
acceptance of the Bonds by the Holders thereof and as part of the
consideration for the issuance of the Bonds.
Section 8.13. Section Headings. The table of contents and
headings of the various articles and sections of this Agreement
are for convenience of reference only and shall not modify,
define or limit any of the terms or provisions hereof.
References to article and section numbers are references to
sections in this Agreement unless otherwise indicated.
IN WITNESS WHEREOF, the Issuer and the Company have caused
this Agreement to be duly executed in their respective names, all
as of the date hereinbefore written.
INDIANA FINANCE AUTHORITY
By:/s/ Ryan Kitchell
-----------------------
Ryan Kitchell, Chairman
ATTEST:
/s/ Jennifer M. Alvey
- ------------------------------------------
Jennifer M. Alvey, Public Finance Director
of the State of Indiana
[SEAL]
UNITED STATES STEEL CORPORATION
/s/ Larry T. Brockway
---------------------
By: Larry T. Brockway
Title: Vice President &
Treasurer