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Exhibit 10.38
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THE INDUSTRIAL DEVELOPMENT AUTHORITY
OF THE CITY OF SHOW LOW, ARIZONA
To
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
As Trustee
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INDENTURE OF TRUST
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Dated as of September 1, 2006
$39,250,000
The Industrial Development Authority of the City of Show Low,
Arizona
Solid Waste Disposal Revenue Bonds
(Snowflake White Mountain Power, LLC Project)
Series 2006
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INDENTURE OF TRUST
(This Table of Contents is not a part of
this Indenture of Trust and is only for
convenience of reference)
TABLE OF CONTENTS
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SECTION HEADING PAGE
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PARTIES..................................................................
1
RECITALS.................................................................
1
Granting Clauses
........................................................ 10
ARTICLE I DEFINITIONS AND
INTERPRETATIONS................................ 12
Section 1.1. Definition of
Terms...................................... 12
Section 1.2. Rules of
Interpretation.................................. 19
ARTICLE II THE
BONDS..................................................... 20
Section 2.1. Authorized Amount of
Bonds............................... 20
Section 2.2. Issuance of Bonds; Interest on
Bonds..................... 20
Section 2.3. Execution; Limited
Obligation............................ 22
Section 2.4.
Authentication........................................... 23
Section 2.5. Form and Place of Payment of
Bonds....................... 23
Section 2.6. Delivery of the
Bonds.................................... 24
Section 2.7. Mutilated, Lost, Stolen or Destroyed
Bonds............... 25
Section 2.8. Registration, Transfer and Exchange of Bonds;
Persons
Treated as Owners..................................... 26
Section 2.9. Cancellation of
Bonds.................................... 28
Section 2.10. Application of Proceeds of
Bonds........................ 28
Section 2.11. Book-Entry
System....................................... 28
ARTICLE III REDEMPTION OF BONDS BEFORE
MATURITY.......................... 29
Section 3.1. Certain Redemption Dates and
Prices...................... 29
Section 3.2. Partial Redemption of
Bonds.............................. 31
Section 3.3. Notice of
Redemption..................................... 32
Section 3.4. Redemption
Payments...................................... 33
Section 3.5.
Cancellation............................................. 33
ARTICLE IV TENDERS FOR PURCHASE AND REMARKETING OF
BONDS................. 34
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Section 4.1. Purchase of Bonds at Option of Holder During Weekly
Rate
Period................................................ 34
Section 4.2. Mandatory Purchase of
Bonds.............................. 35
Section 4.3. Procedures for Remarketing of
Bonds...................... 37
Section 4.4. Duties of the Trustee with Respect to Tendered
Bonds..... 38
Section 4.5. Duties of the Remarketing
Agent.......................... 39
ARTICLE V GENERAL
COVENANTS.............................................. 39
Section 5.1. Payment of Principal, Premium, if any, Interest
and
Purchase Price........................................ 39
Section 5.2. Performance of Covenants;
Issuer......................... 40
Section 5.3. Right to Payments Under Agreement; Instruments of
Further
Assurance............................................. 40
Section 5.4. Recordation and Other
Instruments........................ 40
Section 5.5. Inspection of
Books...................................... 41
Section 5.6. List of
Bondholders...................................... 41
Section 5.7. Rights Under
Agreement................................... 41
Section 5.8. Prohibited
Activities.................................... 41
ARTICLE VI REVENUES AND
FUNDS............................................ 42
Section 6.1. Source of Payment of
Bonds............................... 42
Section 6.2. Creation of Bond
Fund.................................... 42
Section 6.3. Payments into Bond
Fund.................................. 42
Section 6.4. Use of Moneys in Bond Fund; Payments under
Credit
Facility.............................................. 42
Section 6.5. Custody of Bond
Fund..................................... 44
Section 6.6. Construction
Fund........................................ 44
Section 6.7. Payments into Construction Fund;
Disbursements........... 45
Section 6.8. Completion of
Project.................................... 45
Section 6.9. Transfer of Construction
Fund............................ 45
Section 6.10. Creation and Sources of Bond Purchase
Fund.............. 46
Section 6.11. Use of Moneys in the Bond Purchase
Fund................. 46
Section 6.12. Non-presentment of
Bonds................................ 49
Section 6.13. Moneys to be Held in
Trust.............................. 49
Section 6.14. Repayment to the Company and Credit Facility
Provider
from Bond Fund and Bond Purchase Fund................ 50
Section 6.15. Additional Payments Under the
Agreement................. 50
Section 6.16. Tax
Agreement........................................... 50
ARTICLE VII INVESTMENT OF
MONEYS......................................... 50
ARTICLE VIII DISCHARGE OF
LIEN........................................... 51
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ARTICLE IX DEFAULT PROVISIONS AND REMEDIES OF TRUSTEE AND
BONDHOLDERS.... 53
Section 9.1. Defaults; Events of
Default.............................. 53
Section 9.2. Acceleration;
Alternative................................ 54
Section 9.3. Other Remedies; Rights of
Bondholders.................... 55
Section 9.4. Right of Credit Facility Provider and Bondholders
to
Direct Proceedings.................................... 56
Section 9.5. Appointment of
Receivers................................. 56
Section 9.6.
Waiver................................................... 56
Section 9.7. Application of
Moneys.................................... 56
Section 9.8. Remedies Vested in
Trustee............................... 58
Section 9.9. Rights and Remedies of
Bondholders....................... 58
Section 9.10. Termination of
Proceedings.............................. 59
Section 9.11. Waivers of Events of
Default............................ 59
Section 9.12. Notice of Defaults under Section 9.1(d);
Opportunity of
the Issuer and the Company to Cure Such Defaults..... 60
Section 9.13. Limitation of Default and
Remedies...................... 60
ARTICLE X TRUSTEE AND REMARKETING
AGENT.................................. 60
Section 10.1. Acceptance of
Trusts.................................... 60
Section 10.2. Fees, Charges, Indemnities and Expenses of the
Trustee.. 63
Section 10.3. Notice of
Default....................................... 64
Section 10.4. Intervention by the
Trustee............................. 64
Section 10.5. Successor
Trustee....................................... 64
Section 10.6. Resignation by the
Trustee.............................. 64
Section 10.7. Removal of the
Trustee.................................. 64
Section 10.8. Appointment of Successor
Trustee........................ 65
Section 10.9. Concerning Any Successor
Trustee........................ 65
Section 10.10. Appointment of a
Co-Trustee............................ 66
Section 10.11. Remarketing
Agent...................................... 67
ARTICLE XI SUPPLEMENTAL
INDENTURES....................................... 67
Section 11.1. Supplemental Indentures Not Requiring Consent
of
Bondholders.......................................... 67
Section 11.2. Supplemental Indentures Requiring Consent of
Bondholders.......................................... 69
Section 11.3. Consent of Company, Remarketing Agent and
Credit
Facility Provider.................................... 70
Section 11.4. Notices to Remarketing
Agent............................ 70
Section 11.5. Execution of Supplemental
Indentures.................... 70
ARTICLE XII AMENDMENT OF AGREEMENT AND CREDIT
FACILITY................... 70
Section 12.1. Amendments, Etc., to Agreement Not Requiring
Consent of
Bondholders.......................................... 70
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Section 12.2. Amendments, Etc., to Agreement Requiring Consent
of
Bondholders.......................................... 71
Section 12.3. Consent of Credit Facility
Provider..................... 71
Section 12.4. Amendment of Credit
Facility............................ 71
Section 12.5. Notice to Remarketing
Agent............................. 72
Section 12.6. Execution of
Consents................................... 72
ARTICLE XIII
MISCELLANEOUS............................................... 72
Section 13.1. Consents, Etc., of
Bondholders.......................... 72
Section 13.2. Limitation of
Rights.................................... 73
Section 13.3.
Severability............................................ 73
Section 13.4.
Notices................................................. 73
Section 13.5. Payments Due on Non-Business
Days....................... 74
Section 13.6. Action by
Company....................................... 74
Section 13.7.
Counterparts............................................ 74
Section 13.8. Applicable Provisions of
Law............................ 74
Section 13.9.
Captions................................................ 74
Section 13.10. Provisions for Payment of
Expenses..................... 74
Section 13.11. Limited Liability of Officers,
Etc..................... 75
Section 13.12. Additional Notices to Rating
Agencies.................. 75
Section 13.13. References to Credit Facility
Provider................. 75
Section 13.14. References to Remarketing
Agent........................ 76
Section 13.15. Notice Regarding Cancellation of
Contracts............. 76
Testimonium..............................................................
77
EXHIBIT A Form of
Requisition............................................ A-1
EXHIBIT B Cost of
Issuance............................................... B-1
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INDENTURE OF TRUST
This INDENTURE OF TRUST (the "Indenture"), dated as of September
1, 2006,
by and between THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE CITY
OF SHOW LOW,
ARIZONA, a nonprofit corporation designated as a political
subdivision under the
Constitution and laws of the State of Arizona (the "Issuer"),
and J.P. MORGAN
TRUST COMPANY, NATIONAL ASSOCIATION, a national banking
association duly
organized and existing under the laws of the United States of
America with its
designated corporate trust office located in Tempe, Arizona, as
Trustee (the
"Trustee").
WITNESSETH:
WHEREAS, the Issuer is authorized under the Constitution and
laws of the
State of Arizona, including Title 35, Chapter 5, Arizona Revised
Statutes, as
supplemented and amended (the "Act"), to issue revenue bonds in
accordance with
the Act for the purpose of financing or refinancing the
acquisition,
construction, improvement or equipping of a "project" as defined
therein; and
WHEREAS, the Issuer has authorized the issuance of its Solid
Waste Disposal
Revenue Bonds (Snowflake White Mountain Power, LLC Project)
Series 2006 (the
"Bonds") in the aggregate principal amount of $39,250,000
pursuant to the Act
for the purpose of defraying the costs of acquiring,
constructing and installing
certain solid waste disposal facilities (the "Project") to be
owned by Snowflake
White Mountain Power, LLC, an Arizona limited liability company
(the "Company")
and a wholly-owned indirect subsidiary of NZ Legacy, LLC, an
Arizona limited
liability company; and
WHEREAS, the Issuer has entered into a Loan Agreement, dated as
of
September 1, 2006, with the Company specifying the terms and
conditions of a
loan by the Issuer to the Company of the proceeds of the Bonds
for the purpose
of financing the Project and the payment by the Company to the
Issuer of amounts
sufficient for the payment of the principal and purchase prices
of, and premium,
if any, and interest on, the Bonds and certain related expenses;
and
WHEREAS, a direct pay irrevocable letter of credit (the
"Fronting Credit
Facility") delivered by CoBank, ACB (the "Fronting Credit
Facility Provider"),
supported by an irrevocable confirmation ("the Confirming Credit
Facility" and,
together with the Fronting Credit Facility, the "Initial Credit
Facility")
delivered by JPMorgan Chase Bank, N.A. (the "Confirming Credit
Facility
Provider" and, together with the Fronting Credit Facility
Provider, the "Initial
Credit Facility Provider") are being issued simultaneously
herewith to the
Trustee to further secure the payment of the principal and
purchase prices of
and interest on the Bonds; and
WHEREAS, the Issuer has contracted for the sale and delivery of
the Bonds
to be issued in the aggregate principal amount of $39,250,000 as
herein
provided; and
WHEREAS, in order to provide for the authentication and delivery
of the
Bonds, to establish and declare the terms and conditions upon
which the Bonds
are to be issued and
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secured and to secure the payment of the principal thereof and
premium, if any,
and interest thereon, the Issuer has authorized the execution
and delivery of
this Indenture; and
WHEREAS, the Bonds, the certificate of authentication to be
endorsed on the
Bonds and the form of assignment to be endorsed on the Bonds are
to be in
substantially the following forms, with appropriate variations,
omissions and
insertions as permitted or required by this Indenture,
to-wit:
(FORM OF BOND)
UNITED STATES OF AMERICA
THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE
CITY OF SHOW LOW, ARIZONA
SOLID WASTE DISPOSAL REVENUE BONDS
(SNOWFLAKE WHITE MOUNTAIN POWER, LLC PROJECT)
SERIES 2006
No. ____________________ $39,250,000
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Issue Date: Maturity Date: CUSIP:
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September __, 2006 July 1, 2037
Registered Owner:
Principal Amount:
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KNOW ALL MEN BY THESE PRESENTS that The Industrial Development
Authority of
the City of Show Low, Arizona (the "Issuer"), a nonprofit
corporation designated
as a political subdivision under the Constitution and laws of
the State of
Arizona, for value received, hereby promises to pay, solely and
only from the
sources and as hereinafter provided, to the Registered Owner
specified above
(the "Registered Owner"), or registered assigns, the Principal
Amount specified
above, payable on the Maturity Date specified above (the
"Maturity Date"),
except as the provisions hereinafter set forth with respect to
redemption and
acceleration of maturity prior to the Maturity Date may become
applicable
hereto, and in like manner to pay interest on said sum, at the
rate that is in
effect from time to time, in accordance with the provisions
hereof until the
principal hereof is paid or made available for payment. During
the Weekly Rate
Period, interest hereon shall be calculated on the basis of a
calendar year
consisting of 365 or 366 days, as the case may be, and on the
actual number of
days elapsed. During the Fixed Rate Period, interest hereon
shall be calculated
on the basis of a calendar year consisting of 360 days of twelve
(12) thirty-day
months. Interest hereon shall be payable in arrears on each
Interest Payment
Date, until the principal sum hereof becomes due and payable.
Principal of and
premium, if any, on this Bond shall be payable in lawful money
of the United
States of America at the designated corporate trust office (the
"Principal
Office") of J.P. Morgan Trust Company,
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National Association, as trustee, or its successor under trust
(the "Trustee").
"Interest Payment Date" means (a) with respect to the Weekly
Rate Period, the
first day of each January, April, July and October, commencing
with October,
2006, (b) with respect to the Fixed Rate Period, January 1 and
July 1 of each
year commencing on the January 1 or July 1 next following the
Fixed Rate
Adjustment Date, (c) the Fixed Rate Adjustment Date and (d) the
Maturity Date;
provided that, if a day which is an Interest Payment Date is not
a Business Day,
then payment shall be made on the next succeeding Business Day,
but interest
paid on such Business Day shall accrue only through the day next
preceding the
Interest Payment Date. "Business Day" means any day on which
payments can be
effected on the Fedwire system, other than a Saturday, a Sunday
or a day on
which banking institutions in the city in which the principal
office of the
Company or the Principal Office of the Trustee or the principal
office of the
Remarketing Agent is located or any office of the Credit
Facility Provider at
which action is to be taken to realize moneys under the Credit
Facility then in
effect is located are required or authorized by law or executive
order to be
closed, or other than a day on which the New York Stock Exchange
is closed.
Interest on this Bond shall be payable to the Registered Owner
hereof as of
the Record Date preceding the related Interest Payment Date.
Except while the
Bonds are in a book-entry system of registration, payments of
interest on this
Bond shall be made in next day funds by check of the Trustee
mailed on the
applicable Interest Payment Date to the Registered Owner hereof
at his address
as it appears on the registration books of the Issuer kept by
the Trustee, as
bond registrar, or at such other address as is furnished to the
Trustee in
writing by such Registered Owner no later than the close of
business on the
Record Date; provided, that, with respect to the Weekly Rate
Period, payments of
interest on this Bond shall be made by wire transfer of
immediately available
funds to the Registered Owner of this Bond to an account at a
financial
institution located in the continental United States, provided
that such
Registered Owner shall have given written notice to the Trustee
by the
applicable Record Date identifying the location and number of
the account to
which such payment should be wired; provided further, that with
respect to the
Fixed Rate Period payments of interest on this Bond may be made
by wire transfer
of immediately available funds to the Registered Owner of this
Bond to an
account at a financial institution located in the continental
United States in
the event that the Registered Owner hereof is the Registered
Owner of at least
$1,000,000 in aggregate principal amount of the Bonds as of the
close of
business on the Record Date immediately preceding the applicable
Interest
Payment Date and such Registered Owner shall have given written
notice to the
Trustee on or before the second Business Day immediately
preceding such Record
Date, directing the Trustee to make such payments of interest by
wire transfer
and identifying the location and number of the account to which
such payments
should be wired. As used herein, the term "Record Date" shall
mean, with respect
to any Interest Payment Date in respect of the Weekly Rate
Period, the Business
Day immediately preceding such Interest Payment Date and, with
respect to any
Interest Payment Date in respect of the Fixed Rate Period, the
fifteenth day of
the calendar month immediately preceding such Interest Payment
Date.
This Bond is issued pursuant to and in full compliance with
the
Constitution and laws of the State of Arizona, including
particularly Title 35,
Chapter 5, Arizona Revised Statutes, as supplemented and amended
(the "Act"),
and in accordance with action taken by the governing body of the
Issuer. This
Bond and the obligation to pay interest hereon are special,
limited
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obligations of the Issuer, secured as herein described and
payable solely out of
the revenues and income derived from the Agreement and as
otherwise provided in
the hereinafter defined Indenture.
THIS BOND DOES NOT, AND SHALL NEVER, CONSTITUTE AN INDEBTEDNESS
OF THE CITY
OF SHOW LOW, THE STATE OF ARIZONA OR THE ISSUER WITHIN THE
MEANING OF ANY STATE
CONSTITUTIONAL PROVISION OR STATUTORY LIMITATION, AND THIS BOND
SHALL NEVER
CONSTITUTE OR GIVE RISE TO A PECUNIARY LIABILITY OF SAID CITY,
SAID STATE OR THE
ISSUER OR A CHARGE AGAINST THE GENERAL CREDIT OR TAXING POWERS
OF SAID CITY OR
SAID STATE OR A CHARGE AGAINST THE GENERAL CREDIT OF THE ISSUER.
THE ISSUER HAS
NO TAXING POWER.
This Bond is one of an authorized series of Bonds in the
aggregate
principal amount of $39,250,000 (the "Bonds") issued for the
purpose of
defraying the costs of acquiring, constructing and installing
certain solid
waste disposal facilities (the "Project") for Snowflake White
Mountain Power,
LLC, an Arizona limited liability company (the "Company") and a
wholly-owned
indirect subsidiary of NZ Legacy, LLC, an Arizona limited
liability company,
located in Navajo County, Arizona. The Bonds are all issued
under and are
equally and ratably secured by and entitled to the protection of
an Indenture of
Trust dated as of September 1, 2006 (which indenture, as from
time to time
amended and supplemented, is herein referred to as the
"Indenture"), duly
executed and delivered by the Issuer to the Trustee. Reference
is hereby made to
the Indenture for a description of the rights, duties and
obligations of the
Issuer, the Trustee and the owners of the Bonds and the terms
upon which the
Bonds are issued and secured. The terms and conditions of the
use of the
proceeds of the Bonds and the payment of loan repayment
installments by the
Company (which installments are correlated to the terms of the
Bonds as to
principal amount and maturity date, interest rates and payment
dates and
prepayment (or redemption) provisions) are contained in a Loan
Agreement dated
as of September 1, 2006 (which agreement, as from time to time
amended and
supplemented, is herein referred to as the "Agreement"), by and
between the
Issuer and the Company. Capitalized terms used herein and not
defined shall have
the meanings set forth in the Indenture.
The Bonds are issuable only as fully registered Bonds without
coupons in
denominations of $100,000 or any integral multiple of $5,000 in
excess thereof
during the Weekly Rate Period and in denominations of $5,000 or
any integral
multiple thereof during the Fixed Rate Period (such
denominations being herein
referred to as "Authorized Denominations"). This Bond is
transferable by the
Registered Owner hereof in person or by his attorney duly
authorized in writing
at the designated corporate trust office of the Trustee, but
only in the manner,
subject to the limitations and upon payment of the charges
provided in the
Indenture, and upon surrender and cancellation of this Bond.
Upon such transfer
a new Bond or Bonds of Authorized Denomination or Denominations
for the same
aggregate principal amount will be issued to the transferee in
exchange herefor.
The Issuer and the Trustee may deem and treat the Registered
Owner hereof as the
absolute owner hereof for the purpose of receiving payment of or
on account of
principal hereof and premium, if any, hereon and interest due
hereon and for all
other purposes, and neither the Issuer nor the Trustee shall be
affected by any
notice to the contrary.
Subject to the limitations and upon payment of the charges
provided in the
Indenture, and upon surrender and cancellation thereof, Bonds
may be exchanged
for a like aggregate principal
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amount of Bonds of other Authorized Denominations. The Trustee
shall not be
required to transfer or exchange any Bond after notice calling
such Bond or
portion thereof for redemption prior to maturity has been given
as provided in
the Indenture, or during the period of fifteen (15) days next
preceding the
giving of such notice of redemption, except a transfer upon a
tender of a Bond
for purchase as provided in the Indenture.
No recourse shall be had for the payment of the principal of,
premium, if
any, and interest on any of the Bonds or for any claim based
thereon or upon any
obligation, covenant or agreement in the Indenture contained,
against any past,
present or future official or employee of the Issuer, or of any
successor
thereof, as such, either directly or indirectly or through the
Issuer or any
successor, under any rule of law or equity, statute or
constitution or by the
enforcement of any assessment or penalty or otherwise, and all
such liability of
any such official or employee as such is hereby expressly waived
and released as
a condition of and consideration for the execution of the
Indenture and the
issuance of any of the Bonds. Neither any director, officer,
employee or agent
of the Issuer nor any person executing the Bonds shall be
personally liable,
either jointly or severally, thereon or be subject to any
personal liability or
accountability by reason of the issuance thereof.
Payments pursuant to the Agreement and as otherwise provided in
the
Indenture sufficient for the prompt payment, when due, of the
principal of and
interest, and premium, if any, on the Bonds are to be paid to
the Trustee for
the account of the Issuer and deposited in a special trust fund
created by the
Issuer and identified as the Bond Fund, and such payments have
been duly pledged
and assigned for that purpose, and in addition certain rights of
the Issuer
under the Agreement have been assigned to the Trustee to secure
payment of such
principal, premium, if any, and interest under the
Indenture.
The Bonds and the interest thereon are payable from Revenues and
from
drawings on an irrevocable, transferable, direct pay letter of
credit dated
September 7, 2006 (the "Fronting Credit Facility") delivered by
CoBank, ACB (the
"Fronting Credit Facility Provider"), supported by an
irrevocable confirmation
(the "Confirming Credit Facility" and, together with the
Fronting Credit
Facility, the "Initial Credit Facility") delivered by JPMorgan
Chase Bank, N.A.
(the "Confirming Credit Facility Provider" and, together with
the Fronting
Credit Facility Provider and any issuer of an Alternate Credit
Facility, the
"Credit Facility Provider"), in favor of the Trustee, for the
benefit of the
owners from time to time of the Bonds supporting the payment of
the unpaid
principal amount of the Bonds or that portion of the purchase
price of the Bonds
corresponding to principal of the Bonds and up to 106 days of
interest on the
Bonds (computed at the Cap Rate on the basis of a year of 365
days) to pay
interest accrued on the Bonds or that portion of the purchase
price
corresponding to interest accrued on the Bonds when due under
the conditions set
forth therein. The Initial Credit Facility will expire on
September 7, 2008,
unless extended, but may be earlier terminated upon the
occurrence of certain
events stated therein. The Initial Credit Facility, together
with any Alternate
Credit Facility, is herein referred to as the "Credit
Facility."
The Bonds shall bear interest at the Weekly Rate unless and
until such
interest is adjusted to the Fixed Rate. During the Weekly Rate
Period, the Bonds
shall bear interest at the Weekly Interest Rate, which shall be
determined by
the Remarketing Agent in accordance with the provisions of the
Indenture by no
later than 9:30 a.m., New York City time, on the Issue Date
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and thereafter by no later than 9:30 a.m., New York City time,
on the Business
Day next preceding Thursday of each week.
The interest rate on the Bonds may be adjusted to the Fixed Rate
as
provided in the Indenture. If the interest rate on the Bonds is
adjusted to the
Fixed Rate, the Bonds shall thereafter bear interest at the
Fixed Rate, which
shall be determined in accordance with the provisions of the
Indenture by the
Remarketing Agent not less than three (3) days prior to the
Fixed Rate
Adjustment Date. If the interest rate on the Bonds is adjusted
to the Fixed
Rate, the Trustee shall give notice of such adjustment to the
owners of the
Bonds not less than thirty (30) days prior to its effective
date.
In no event shall the Bonds bear interest at a rate greater than
the lesser
of (a) the rate agreed to by the Credit Facility Provider of any
Credit Facility
then in effect with respect to the Bonds (initially 8% per
annum) or (b) the
maximum rate then permitted by applicable law (the "Cap
Rate").
The Issuer, at the direction of the Company, has appointed
Thornton Farish
Inc. as Remarketing Agent under the Indenture. The Issuer may,
at the direction
of the Company, from time to time, remove or replace the
Remarketing Agent. The
determination of any interest rate by the Remarketing Agent
shall be conclusive
and binding on the Issuer, the Company, the Trustee, the Credit
Facility
Provider, the Remarketing Agent and the owners from time to time
of all of the
Bonds.
THE BONDS ARE SUBJECT TO REDEMPTION AT THE OPTION OF THE COMPANY
AND TO
PURCHASE AT THE OPTION OF THE OWNERS THEREOF AS PROVIDED IN THE
INDENTURE. IN
ADDITION, THE BONDS ARE SUBJECT TO MANDATORY REDEMPTION AND TO
MANDATORY
PURCHASE UPON THE TERMS PROVIDED IN THE INDENTURE.
The Registered Owner of this Bond shall have no right to enforce
the
provisions of the Indenture or the Agreement or to institute
action to enforce
the covenants therein, or to take any action with respect to any
event of
default under the Indenture or the Agreement, or to institute,
appear in or
defend any suit or other proceedings with respect thereto,
except as provided in
the Indenture. So long as the Credit Facility Provider has not
wrongfully failed
to honor a demand for payment under the Credit Facility which
wrongful dishonor
is continuing, the Credit Facility Provider shall be entitled,
but not
obligated, to request that the Trustee exercise or to direct the
Trustee in the
exercise of all rights and remedies upon the occurrence of an
event of default
under the Indenture. In certain events, on the conditions, in
the manner and
with the effect set forth in the Indenture, the principal of all
the Bonds
issued under the Indenture and then outstanding may become or
may be declared
due and payable before the Maturity Date, together with interest
accrued
thereon. The Indenture prescribes the manner in which it may be
discharged,
including a provision that under certain circumstances the Bonds
shall be deemed
to be paid if Governmental Obligations maturing as to principal
and interest in
such amounts and on such dates as will provide sufficient
Available Moneys to
pay the principal of and interest and premium, if any, on the
Bonds shall have
been deposited with the Trustee, and if moneys sufficient to pay
all fees,
charges and expenses of the Trustee and all other liabilities of
the Company
under the Agreement and to the Credit Facility Provider shall
have been paid or
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<PAGE>
provided for, after which the Bonds shall no longer be secured
by or entitled to
the benefits of the Indenture or the Agreement, except for
purposes of transfer
and exchange and payment from such Governmental Obligations on
the date or dates
specified at the time of such deposit.
The Indenture permits the amendment thereof and the modification
of the
rights and obligations of the Issuer and the rights of the
owners of the Bonds
at any time by the Issuer and the Trustee with the consent of
the owners of not
less than a majority, or in certain instances 100%, in aggregate
principal
amount of the Bonds at the time outstanding. Any such consent or
waiver by the
Registered Owner of this Bond shall be conclusive and binding
upon such owner
and upon all future owners of this Bond and of any Bond issued
upon the transfer
or exchange of this Bond whether or not notation of such consent
or waiver is
made upon this Bond. The Indenture also contains provisions
permitting the
Trustee to enter into certain supplemental indentures without
the consent of the
owners of the Bonds and to waive certain past defaults under the
Indenture and
their consequences. No amendment of the Indenture will become
effective without
the consent of the Company and, if a Credit Facility is then in
effect or any
obligations of the Company to the Credit Facility Provider
remain unsatisfied,
the Credit Facility Provider.
Terms which are used herein as defined terms and which are not
otherwise
defined herein shall have the meanings specified for such terms
in the
Indenture.
This Bond shall not be valid or become obligatory for any
purpose or be
entitled to any security or benefit under the Indenture until
the certificate of
authentication hereon shall have been manually executed by the
Trustee. This
Bond is issued with the intent that the laws of the State of
Arizona will govern
its construction.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts,
conditions and
things required to exist, happen and be performed precedent to
and in the
execution and delivery of the Indenture and the issuance of this
Bond do exist,
have happened and have been performed in due time, form and
manner as required
by law; and that the issuance of this Bond and the series of
which it forms a
part does not exceed or violate any constitutional or statutory
limitation.
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<PAGE>
IN WITNESS WHEREOF, The Industrial Development Authority of the
City of
Show Low, Arizona has caused this Bond to be signed in its name
and on its
behalf by the facsimile signatures of the persons thereunto duly
designated by
its Board, all as of the Issue Date.
THE INDUSTRIAL DEVELOPMENT AUTHORITY OF
THE CITY OF SHOW LOW, ARIZONA
By:
------------------------------------
Title: President
ATTEST:
By:
---------------------------------
Title: Secretary
[FORM OF CERTIFICATE OF AUTHENTICATION]
This Bond is one of the Bonds of the issue described in the
within
mentioned Indenture of Trust.
J.P. MORGAN TRUST COMPANY, NATIONAL
ASSOCIATION
Date of Authentication: as Trustee
By:
------------------------------------
------------------------------------
Authorized Officer
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<PAGE>
[FORM OF ASSIGNMENT]
The following abbreviations, when used in the inscription on the
face of
this Bond, shall be construed as though they were written out in
full according
to applicable laws or regulations:
UNIF GIFT MIN ACT-- ____________________ Custodian
_______________________
(Cust) (Minor)
under Uniform Gifts to
Minors Act _______________________
(State)
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not
as
tenants in common
Additional abbreviations may also be used though not in the
above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers
unto
________________________________________________________________________________
________________________________________________________________________________
(Name and Address of Assignee)
(Taxpayer I.D. No.
______________________________________________________)
the within Bond of The Industrial Development Authority of the
City of Show Low,
Arizona numbered __________________________________, and does
hereby irrevocably
constitute and appoint
_______________________________________________ to
transfer said Bond on the books kept for registration thereof
with full power of
substitution in the premises.
Dated:
----------------------
NOTICE: The signature(s) to this Assignment must correspond with
the name as it
appears upon the face of the Bond in every particular, without
alteration or
enlargement or any change whatever.
Signature Guaranteed:
------------------------------
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<PAGE>
NOTICE: Signature(s) must be guaranteed by a member of a
signature medallion
program.
* * * * * *
WHEREAS, all things necessary to make the Bonds, when
authenticated by the
Trustee and issued as in this Indenture provided, the valid,
binding and legal
obligations of the Issuer according to the import thereof, and
to constitute
this Indenture a valid assignment and pledge of the amounts
assigned and pledged
to the payment of the principal of, premium, if any, and
interest on the Bonds
and, on a subordinate basis and after payment in full of all of
the Bonds other
than Company Bonds and Pledged Bonds, the obligations under the
Credit
Agreement, and a valid assignment and pledge of certain rights
of the Issuer
under the Agreement have been done and performed, and the
creation, execution
and delivery of this Indenture, and the creation, execution and
issuance of the
Bonds, subject to the terms hereof, have in all respects been
duly authorized:
GRANTING CLAUSES
NOW, THEREFORE, THIS INDENTURE OF TRUST WITNESSETH:
That the Issuer in consideration of the premises and the
acceptance by the
Trustee of the trusts hereby created and of the purchase and
acceptance of the
Bonds by the owners thereof, the issuance of the Initial Credit
Facility by the
Initial Credit Facility Provider and of the sum of ten dollars,
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
considerations, the receipt of which is hereby acknowledged, in
order to secure
the payment of the principal of, and premium, if any, and
interest on, or
purchase prices of, the Bonds according to their tenor and
effect, and to secure
certain of the Company's obligations under the hereinafter
defined Credit
Agreement, and to secure the performance and observance by the
Issuer of all the
covenants expressed or implied herein and in the Bonds, does
hereby grant,
bargain, sell, convey, assign and pledge, and grant a security
interest to J.P.
Morgan Trust Company, National Association, as Trustee, and its
successors in
trust and assigns forever, for the benefit of the owners from
time to time of
the Bonds and, on a subordinate basis and after payment in full
of all of the
Bonds other than Company Bonds and Pledged Bonds, for the
benefit of the
hereinafter defined Credit Facility Provider, to the extent
provided in this
Indenture:
GRANTING CLAUSE FIRST
All of the right, title and interest of the Issuer in and to the
Agreement
and all Revenues, as hereinafter defined, except for the rights
of the Issuer
under Sections 4.2(c), 5.2 and 6.3 of the Agreement and the
rights to make
determinations and receive notices as therein provided;
GRANTING CLAUSE SECOND
All moneys and securities from time to time held by the Trustee
under the
terms of this Indenture, including without limitation any moneys
realized under
a Credit Facility (as
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<PAGE>
hereinafter defined), and any and all other real or personal
property of every
name and nature from time to time hereafter by delivery or by
writing of any
kind conveyed, mortgaged, pledged, assigned or transferred, as
and for
additional security hereunder, by the Issuer or by anyone on its
behalf or with
its written consent to the Trustee which is hereby authorized to
receive any and
all such property at any and all times and to hold and apply the
same subject to
the terms hereof;
TO HAVE AND TO HOLD all and singular the Trust Estate (as
hereinafter
defined), whether now owned or hereafter acquired, unto the
Trustee and its
respective successors in said trust and assigns forever;
IN TRUST, upon the terms and trusts herein set forth for the
equal and
proportionate benefit, security and protection of all present
and future owners
of the Bonds from time to time 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 of the other Bonds (except as otherwise
specifically provided
herein); provided however, that until such time as the owners of
all of the
Bonds (other than Company Bonds and Pledged Bonds) have been
paid in full, the
lien and security interest granted herein for the benefit of the
Credit Facility
Provider shall at all times be subject and subordinate to the
Hen and security
interest granted herein for the benefit of the owners of Bonds
(other than the
owners of Pledged Bonds and Company Bonds);
PROVIDED, HOWEVER, that if the Issuer, its successors or
assigns, shall
well and truly pay, or cause to be paid, the principal of,
premium, if any, and
interest on the Bonds due or to become due thereon, on the dates
and in the
manner mentioned in the Bonds according to the true intent and
meaning thereof,
and shall cause the payments to be made on the Bonds as required
under Article V
hereof, or shall provide, as permitted hereby, for the payment
thereof by
depositing with the Trustee the entire amount due or to become
due thereon (or
Governmental Obligations, as hereinafter defined, sufficient for
that purpose as
provided in Article VIII hereof), and shall pay or cause to be
paid to the
Trustee all sums of money due or to become due to it in
accordance with the
terms and provisions hereof and shall pay or cause to be paid
all sums owing to
the Credit Facility Provider under the Credit Agreement, and,
after said
payments on the Bonds and payment of such other sums have been
made, then upon
the final payment thereof or provision therefor this Indenture
and the rights
hereby granted shall cease, determine and be void; otherwise
this Indenture to
be and remain in full force and effect.
THIS INDENTURE OF TRUST FURTHER WITNESSETH, and it is expressly
declared
that, all Bonds issued and secured hereunder are to be issued,
authenticated and
delivered and all said property, rights and interests,
including, without
limitation, the amounts hereby assigned and pledged, are to be
dealt with and
disposed of under, upon and subject to the terms, conditions,
stipulations,
covenants, agreements, trusts, uses and purposes as hereinafter
expressed, and
the Issuer has agreed and covenanted, and does hereby agree and
covenant with
the Trustee and with the respective owners of the Bonds as
follows (subject,
however, to the provisions of Section 2.3 hereof):
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<PAGE>
ARTICLE I
DEFINITIONS AND INTERPRETATIONS
SECTION 1.1. DEFINITION OF TERMS. All words and phrases defined
in Article
I of the Agreement shall have the same meanings in this
Indenture. In addition,
the following words and phrases shall have the following
meanings:
"Act" means Title 35, Chapter 5, Arizona Revised Statutes, as
supplemented
and amended.
"Act of Bankruptcy" means the commencement of a voluntary or
involuntary
case in bankruptcy (or the other commencement of a bankruptcy or
similar
proceeding) by or against the Company or the Issuer or any
Affiliate or Insider
of the Company under any applicable bankruptcy, insolvency,
reorganization or
similar law, now or hereinafter in effect.
"Administrative Agent" means the Administrative Agent under the
Fronting
Credit Facility Agreement, initially CoBank, ACB.
"Affiliate" means any person directly or indirectly controlling
or
controlled by or under direct or indirect common control with
the Company; and
"control" means the power to direct the management and policies
of such person,
directly or indirectly, whether through the ownership of voting
securities, by
contract or otherwise.
"Agreement" means the Loan Agreement dated as of August 1,2006,
by and
between the Issuer and the Company, as from time to time
supplemented and
amended, relating to the Bonds.
"Alternate Credit Facility" means an irrevocable, transferable,
direct pay
letter of credit and irrevocable confirmation substantially the
same as to form
and substance as the Initial Credit Facility.
"Authorized Denomination" means (a) $100,000 or any integral
multiple of
$5,000 in excess thereof when the Bonds bear interest at the
Weekly Rate, and
(b) $5,000 or any integral multiple thereof when the Bonds bear
interest at the
Fixed Rate.
"Available Moneys" means (a) with respect to any date on which
principal
of, premium, if any, or interest on the Bonds is due or the
purchase price of
any Bond is payable during the term of a Credit Facility (i)
Bond proceeds
deposited with the Trustee contemporaneously with the issuance
and sale of the
Bonds and which were continuously thereafter held subject to the
lien of this
Indenture in a separate and segregated fund, account or
subaccount established
hereunder (other than the Bond Purchase Fund) in which no moneys
which were not
Available Moneys were at any time held, together with investment
earnings on
such Bond proceeds, (ii) moneys which have been paid to the
Trustee by the
Company and have been continuously on deposit with the Trustee
and subject to
the lien of this Indenture in a separate and segregated account
or accounts or
sub-account or sub-accounts in which no other moneys are held
for at least one
year during and prior to which no Act of Bankruptcy shall have
occurred (unless
the
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<PAGE>
petition giving rise to such Act of Bankruptcy shall have been
dismissed and
such dismissal shall be final and not subject to appeal), and
the proceeds from
the investment thereof, (iii) moneys on deposit with the Trustee
representing
proceeds from the remarketing by the Remarketing Agent of Bonds
purchased as
described in Section 4.1 or Section 4.2 hereof to any person
other than the
Company, the Issuer or any Affiliate or Insider of the Company
which in each
case were at all times since their receipt by the Trustee held
in a separate and
segregated account or accounts or sub-account or sub-accounts in
which no moneys
which were not Available Moneys were at any time held, (iv)
moneys realized
under a Credit Facility which were at all times since their
receipt by the
Trustee held in a separate and segregated account or accounts or
sub-account or
subaccounts in which no moneys other than those realized under
such Credit
Facility were at any time held, and (v) proceeds from the
issuance and sale of
other indebtedness or any other moneys or securities if there is
delivered to
the Trustee and each Rating Agency then rating the Bonds at the
time of issuance
and sale of such indebtedness or the delivery of such moneys or
securities an
opinion of Counsel nationally recognized in bankruptcy matters
(which may assume
that no Bondholder is an Insider) to the effect that the use of
such proceeds or
moneys to pay the principal of, premium, if any, purchase price
or interest on
the Bonds would not be avoidable as preferential payments under
Section 547 of
the Bankruptcy Code recoverable under Section 550 of the
Bankruptcy Code should
the Company, the Issuer or any Affiliate or Insider of the
Company become a
debtor in a proceeding commenced thereunder; and (b) with
respect to any date on
which principal of, premium, if any, or interest on the Bonds is
due or the
purchase price of any Bond is payable during a period in which a
Credit Facility
is not in effect any moneys furnished to the Trustee pursuant to
this Indenture
and the proceeds from the investment thereof. Notwithstanding
the foregoing,
when used with respect to the payment of any amounts due in
respect of Company
Bonds or Pledged Bonds, the term "Available Moneys" shall mean
any moneys held
by the Trustee and the proceeds from the investment thereof,
except for moneys
realized under a Credit Facility.
"Bankruptcy Code" means the United States Bankruptcy Reform Act
of 1978, as
amended from time to time, or any substitute or replacement
legislation.
"Beneficial Owner" means the owner of a Bond or portion thereof
for federal
income tax purposes.
"Bond" or "Bonds" means the Solid Waste Disposal Revenue Bonds
(Snowflake
White Mountain Power, LLC Project) Series 2006 of the Issuer, in
the aggregate
principal amount of $39,250,000, issued pursuant to this
Indenture.
"Bond Counsel" means Chapman and Cutler LLP or such other
nationally
recognized municipal bond counsel of recognized expertise with
respect to such
matters as may be mutually satisfactory to the Issuer, the
Company (so long as
no event of default is then existing under Section 6.1(a), (b),
(c), (d) or (e)
of the Agreement) and the Trustee.
"Bond Fund" means the fund created and established by Section
6.2 of this
Indenture.
"Bond Fund-Credit Facility Account" means the account of that
name created
and established by Section 6.2 of this Indenture.
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<PAGE>
"Bond Purchase Fund" means the fund created and established by
Section 6.10
of this Indenture.
"Bondholder," "bondholder," "holder", "Bondowner," "bondowner"
and "owner"
mean the Registered Owner of any Bond.
"Business Day" means any day on which payments can be effected
on the
Fedwire system, other than a Saturday, a Sunday or a day on
which banking
institutions in the city in which the Principal Office of the
Company or the
Principal Office of the Trustee or the Principal Office of the
Remarketing Agent
is located or any office of the Credit Facility Provider at
which action is to
be taken to realize moneys under the Credit Facility then in
effect is located
are required or authorized by law or executive order to be
closed, or other than
a day on which the New York Stock Exchange is closed.
"Cap Rate" means the lesser of (a) the rate agreed to by the
Credit
Facility Provider of any Credit Facility then in effect with
respect to the
Bonds (initially 8% per annum) or (b) the maximum rate then
permitted by
applicable law.
"Code" means the Internal Revenue Code of 1986, as amended,
together with
any regulations promulgated thereunder or applicable
thereto.
"Company" means Snowflake White Mountain Power, LLC, a limited
liability
company duly organized and validly existing under the laws of
the State of
Arizona, and a wholly-owned indirect subsidiary of NZ Legacy,
LLC, an Arizona
limited liability company, and its successors and assigns, and
any surviving,
resulting or transferee entity as permitted by Section 5.1 of
the Agreement.
"Principal Office" of the Company means 3418 N. Val Vista Drive,
Mesa, Arizona
85213 unless another office is designated as such in writing to
the Trustee, the
Issuer, the Remarketing Agent and the Credit Facility
Provider.
"Company Bonds" means Bonds, other than Pledged Bonds, owned by
the Company
(or any Insider or Affiliate of the Company designated in
writing to the Trustee
as such) and registered in the name of the Company (or such
Insider or Affiliate
of the Company), or in the name of a nominee designated in
writing to the
Trustee by the Company (or such Insider or Affiliate of the
Company).
"Confirming Credit Facility" means the irrevocable confirmation,
dated
September 7, 2006, issued by the Confirming Credit Facility
Provider and
supporting the Fronting Credit Facility, as provided in Section
5.13(a) of the
Agreement.
"Confirming Credit Facility Agreement" means the Confirmation
Agreement,
dated as of September 1, 2006, by and between CoBank, ACB and
JPMorgan Chase
Bank, N.A., as from time to time supplemented and amended, under
the terms of
which the Confirming Credit Facility Provider has agreed to
issue and deliver
the Confirming Credit Facility to the Trustee.
"Confirming Credit Facility Provider" means JPMorgan Chase Bank,
N.A.,
issuer of the Confirming Credit Facility, or its successors and
assigns.
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<PAGE>
"Construction Fund" means the fund created and established by
Section 6.6
of this Indenture.
"Counsel" means an attorney at law or a firm of attorneys (who
may be an
employee of or counsel to the Issuer or the Company or the
Trustee) duly
admitted to the practice of law before the highest court of any
state of the
United States of America or of the District of Columbia.
"Credit Agreement" means collectively, the Fronting Credit
Facility
Agreement together with the Confirming Credit Facility
Agreement; and, unless
the context or use indicates another or different meaning or
intent, any
reimbursement or other agreement between the Company and the
issuer of any
Alternate Credit Facility delivered to the Trustee pursuant to
Section 5.13 of
the Agreement, as from time to time supplemented and amended,
which provides
that it is a Credit Agreement for purposes of the Agreement and
this Indenture.
"Credit Facility" means the Initial Credit Facility or Alternate
Credit
Facility then in effect.
"Credit Facility Interest Amount" means the amount of the
interest portion
of the Credit Facility.
"Credit Facility Provider" means the Initial Credit Facility
Provider and
thereafter the provider of any Alternate Credit Facility then in
effect.
"Direct Participant" means securities brokers and dealers,
banks, trust
companies, clearing corporations and certain other organizations
which
participate in the Securities Depository with respect to the
Bonds.
"Event of Default" or "event of default" means any occurrence or
event
specified as such in and defined as such by Section 9.1
hereof.
"Expiration Date" means the Stated Expiration Date of any Credit
Facility
or any earlier date on which any then current Credit Facility
shall terminate,
expire or be canceled in accordance with its terms.
"Fixed Rate" means the interest rate on the Bonds in effect
during the
Fixed Period, as established in accordance with Section 2.2(c)
hereof.
"Fixed Rate Period" means the period, if any, during which the
Bonds bear
interest at the Fixed Rate.
"Fixed Rate Adjustment Date" means, if it occurs, the date on
which the
Bonds are converted to bear interest at the Fixed Rate.
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<PAGE>
"Fronting Credit Facility" means the irrevocable, transferable
direct pay
letter of credit, dated September 7, 2006, issued by the
Fronting Credit
Facility Provider and delivered to the Trustee, as provided in
Section 5.13(a)
of the Agreement."
"Fronting Credit Facility Agreement" means the Credit Agreement
dated as of
September 1, 2006 among the Company; Renegy, LLC; and Renegy
Trucking, LLC; the
Initial Credit Facility Provider; CoBank, ACB; and the financial
institutions
listed therein, as from time to time supplemented and amended,
under the terms
of which the Fronting Credit Facility Provider has agreed to
issue and deliver
the Fronting Credit Facility to the Trustee.
"Fronting Credit Facility Provider" means CoBank, ACB, issuer of
the
Fronting Credit Facility, or its successors and assigns.
"Governmental Obligations" means noncallable, direct general
obligations
of, or obligations the full and timely payment of the principal
of and interest
on which is unconditionally guaranteed by, the United States of
America.
"Indenture" means this Indenture, as from time to time
supplemented and
amended in accordance with Article XI hereof.
"Initial Credit Facility" means the Fronting Credit Facility
issued by the
Fronting Credit Facility Provider, together with the Confirming
Credit Facility
issued by the Confirming Credit Facility Provider, as provided
in Section
5.13(a) of the Agreement.
"Initial Credit Facility Provider" means the Fronting Credit
Facility
Provider, together with the Confirming Credit Facility
Provider.
"Insider" means an "insider" as defined in the Bankruptcy
Code.
"Interest Payment Date" means (i) with respect to the Weekly
Rate Period,
the first day of each January, April, July and October,
commencing with October,
2006, (ii) with respect to the Fixed Rate Period, January 1 and
July 1 of each
year commencing on the January 1 or July 1 next succeeding the
Fixed Rate
Adjustment Date, (iii) the Fixed Rate Adjustment Date, and (iv)
the Maturity
Date.
"Interest Rate Period" means the Weekly Rate Period or the Fixed
Rate
Period.
"Investment Grade" means, during the Fixed Rate Period, Baa or
BBB by
Moody's or S&P (or an equivalent), or during the Weekly Rate
Period, VMIG-2 or
A2 by Moody's or S&P (or an equivalent).
"Issue Date" means the date the Bonds are delivered to and paid
for by the
Underwriter.
"Issuer" means The Industrial Development Authority of the City
of Show
Low, Arizona, a nonprofit corporation designated as a political
subdivision
under the Constitution and laws of the State of Arizona, and any
successor body
to the duties or functions of the Issuer.
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<PAGE>
"Mandatory Purchase Date" means any date on which the Bonds are
required to
be purchased in accordance with Section 4.2 hereof.
"Maturity Date" means July 1, 2037.
"Moody's" means Moody's Investors Service, Inc., a corporation
organized
and existing under the laws of the State of Delaware, its
successor and their
assigns.
"Outstanding" or "Bonds outstanding" means all Bonds which have
been
authenticated and delivered by the Trustee under this Indenture,
except:
(a) Bonds canceled after purchase or because of payment at
redemption
or at maturity;
(b) Bonds or portions thereof deemed to be paid, as provided
in
Article VIII hereof;
(c) Bonds in lieu of which other Bonds have been authenticated
under
Sections 2.7, 2.8, 3.2, 4.1 and 4.2 hereof; and
(d) Unsurrendered Bonds.
If this Indenture shall have been discharged pursuant to the
provisions of
Article VIII hereof, no Bonds shall be deemed to be Outstanding
within the
meaning of this provision.
"Pledge Agreement" means that certain Bond Pledge Agreement,
dated as of
September 1, 2006, between the Company and CoBank, ACB, as
Collateral Agent, as
amended or supplemented from time to time, or any other such
agreement entered
into by the Company in connection with the issuance of any
Alternate Credit
Facility, as from time to time supplemented and amended, which
provides that it
is a Pledge Agreement for purposes of this Indenture and the
Agreement.
"Pledged Bonds" means any and all Bonds which are, at the time
of
determination thereof, pledged to the Credit Facility Provider
pursuant to any
Pledge Agreement, in each case as a result of such Bonds having
been purchased
with moneys realized under a Credit Facility as described in
Section 6.11(c)
hereof.
"Purchase Price" means the purchase price of a Bond tendered or
deemed
tendered for purchase pursuant to Section 4.1 or 4.2 hereof.
"Rating Agency" means any nationally recognized securities
rating agency
selected by the Company, with notice to the Trustee, and
approved in writing by
the Remarketing Agent and the Credit Facility Provider.
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"Rating Category" or "Rating Categories" means one or more of
the generic
rating categories of a nationally recognized securities rating
agency, without
regard to any refinement or gradation of such rating category or
categories by a
numerical modifier or otherwise.
"Rating Confirmation Notice" means a written notice from
Moody's, if the
Bonds are then rated by Moody's, and S&P, if the Bonds are
then rated by S&P,
and from every other Rating Agency then rating the Bonds,
confirming that the
rating on the Bonds will not be lowered or withdrawn as a result
of the action
proposed to be taken.
"Record Date" means, with respect to any Interest Payment Date
in respect
of the Weekly Rate Period, the Business Day immediately
preceding such Interest
Payment Date and, with respect to any Interest Payment Date in
respect of the
Fixed Rate Period, the fifteenth day of the calendar month
immediately preceding
such Interest Payment Date.
"Registered Owner" means the person or persons in whose name or
names a
Bond shall be registered on the registration books of the Issuer
maintained by
the Trustee for that purpose in accordance with the terms of
this Indenture.
"Remarketing Agent" means initially Thornton Farish Inc., and
thereafter
any successor Remarketing Agent appointed in accordance with
Section 10.11
hereof. "Principal Office" of the Remarketing Agent means,
initially 3500
Eastern Boulevard, Suite 210, Montgomery, Alabama 36116 unless
another office is
designated as such in writing to the Trustee, the Issuer, the
Company and the
Credit Facility Provider.
"Remarketing Agreement" means the Remarketing Agreement dated as
of
September 1, 2006, between the Company and the Remarketing
Agent, as from time
to time supplemented and amended, relating to the Bonds and,
unless the context
or use indicates another or different meaning or intent, any
remarketing
agreement between the Company and the Remarketing Agent, as from
time to time
supplemented and amended, which provides that it is a
Remarketing Agreement for
purposes of this Indenture and the Agreement.
"Revenues" means the amounts pledged to the payment of the
principal of,
premium, if any, and interest on the Bonds, consisting of the
following: (i) all
amounts payable pursuant to Section 4.2(a) of the Agreement and
all receipts of
the Trustee credited against such amounts under the provisions
of this
Indenture, including all moneys realized by the Trustee under a
Credit Facility
to pay the principal of, premium, if any, and interest on the
Bonds, (ii) any
portion of the net proceeds of the Bonds deposited with the
Trustee under
Section 6.3(a) hereof, and (iii) any amounts paid into the Bond
Fund from the
Construction Fund, including income on investments.
"S&P" means Standard & Poor's Ratings Services, a
division of The
McGraw-Hill Companies, Inc., a corporation organized and
existing under the laws
of the State of New York, its successors and their assigns.
"Securities Depository" has the meaning set forth in Section
2.11 hereof.
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"State" means the State of Arizona.
"Stated Expiration Date" means the stated expiration date of any
then
current Credit Facility, or such stated expiration date as it
may be extended
from time to time.
"Tax Agreement" means the Tax Exemption Certificate and
Agreement, dated
the Issue Date, among the Issuer, the Trustee and the Company,
as it may be
amended in accordance with its terms, relating to the Bonds.
"Trust Estate" means the property conveyed to the Trustee for
the benefit
of the owners from time to time of the Bonds and, on a
subordinate basis to the
extent provided in the Granting Clauses of this Indenture, for
the benefit of
the Credit Facility Provider pursuant to the Granting Clauses of
this Indenture.
"Trustee" means J.P. Morgan Trust Company, National Association,
and any
successor trustee at the time serving as successor trustee
hereunder. "Principal
Office" of the Trustee means its designated corporate trust
office, initially
660 S. Mill Avenue, 4th Floor, Tempe, Arizona 85281, and
thereafter the office
designated as such in writing to the Bondholders, the Issuer,
the Company, the
Remarketing Agent and the Credit Facility Provider.
"Underwriter" means Thornton Farish Inc.
"Unsurrendered Bonds" means Bonds (or portions thereof in
Authorized
Denominations) which are not tendered as required under the
provisions of
Section 4.1 and Section 4.2 hereof, but for which there has been
irrevocably
deposited in the Bond Purchase Fund an amount sufficient to pay
the purchase
price thereof and of all other Bonds (if any) tendered or deemed
to be tendered
for purchase on the date specified in Section 4.1 hereof or on a
Mandatory
Purchase Date.
"Weekly Rate" means the interest rate on the Bonds from time to
time in
effect during the Weekly Rate Period.
"Weekly Rate Period" means the period during which the Bonds
bear interest
at the Weekly Rate.
SECTION 1.2. RULES OF INTERPRETATION. The words "hereof,"
"herein,"
"hereunder" and other words of similar import refer to this
Indenture as a
whole.
Unless otherwise specified, references to Articles, Sections,
and other
subdivisions of this Indenture are to the designated Articles,
Sections, and
other subdivisions of this Indenture as originally executed.
The headings of this Indenture are for convenience only and
shall not
define or limit the provisions hereof.
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ARTICLE II
THE BONDS
SECTION 2.1. AUTHORIZED AMOUNT OF BONDS. No Bonds may be issued
under the
provisions of this Indenture except in accordance with this
Article II. The
total principal amount of Bonds that may be issued is hereby
expressly limited
to $39,250,000, except as provided in Sections 2.7,4.1 and 4.2
hereof.
SECTION 2.2. ISSUANCE OF BONDS; INTEREST ON BONDS.
(A) GENERAL. The Bonds shall be designated "The Industrial
Development
Authority of the City of Show Low, Arizona Solid Waste Disposal
Revenue Bonds
(Snowflake White Mountain Power, LLC Project) Series 2006." The
Bonds shall be
issuable only as fully registered Bonds without coupons in
Authorized
Denominations. Unless the Issuer shall otherwise direct, the
Bonds shall be
numbered separately from 1 upward.
All Bonds shall be dated the Issue Date and shall mature on the
Maturity
Date. The Bonds shall be subject to redemption prior to maturity
as set forth in
Article III hereof and shall be subject to purchase as provided
in Article IV
hereof. Interest on the Bonds shall be payable in arrears on
each Interest
Payment Date for each such Bond, until the principal sum becomes
due and payable
and shall accrue from the most recent Interest Payment Date to
which interest
has been paid or duly provided for, or if no interest has been
paid or duly
provided for on the Bonds, then from the Issue Date, until the
principal of the
Bonds is paid or made available for payment. If a day which is
an Interest
Payment Date is not a Business Day, then payment shall be made
on the next
succeeding Business Day, but interest paid on such Business Day
shall accrue
only through the day next preceding such Interest Payment
Date.
The Bonds shall bear interest at the Weekly Rate unless and
until such
interest rate is adjusted to the Fixed Rate as hereinafter
provided. During the
Weekly Rate Period interest shall be calculated on the basis of
a calendar year
consisting of 365 or 366 days, as the case may be, for the
actual number of days
elapsed, and during the Fixed Rate Period interest shall be
calculated on the
basis of a calendar year of 360 days consisting of twelve (12)
thirty-day
months.
(B) WEEKLY RATE. During the Weekly Rate Period, the Bonds shall
bear
interest at the Weekly Rate, which shall be determined by the
Remarketing Agent
by no later than 9:30 a.m., New York City time, on the Issue
Date and thereafter
by no later than 9:30 a.m., New York City time, on the Business
Day next
preceding Thursday of each week during the Weekly Rate Period.
The Weekly Rate
shall be the rate determined by the Remarketing Agent under then
prevailing
market conditions to be the minimum interest rate which, if
borne by the Bonds
on the effective date of such rate, would enable the Remarketing
Agent to sell
the Bonds on such date at a price (without regard to accrued
interest) equal to
the principal amount thereof; provided, however, that (A) if the
Remarketing
Agent shall not have determined a Weekly Rate for any period,
the Weekly Rate
for such period shall be the same as the Weekly Rate for the
immediately
preceding period and (B) in no event shall the Weekly Rate
exceed the Cap Rate.
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The first Weekly Rate shall apply to the period commencing on
the Issue Date and
ending on the next succeeding Wednesday. Thereafter, each Weekly
Rate shall
apply to the period commencing on each Thursday and ending on
the next
succeeding Wednesday; provided, however, if the Weekly Rate
Period shall end on
a day other than Wednesday, the last Weekly Rate for the Weekly
Rate Period
shall apply to the period commencing on the Thursday preceding
the last day of
the Weekly Rate Period and ending on such last day. The
Remarketing Agent shall
provide the Company and the Trustee with immediate telephonic
notice of each
Weekly Rate, as determined, which notice shall be confirmed in
writing. The
Trustee shall (1) calculate the amount of interest to be paid on
each Interest
Payment Date in respect of the Weekly Rate Period and (2) notify
the Company of
the amount of interest to be paid on each such Interest Payment
Date as soon as
practicable but in any event no later than the Business Day
preceding the
related Interest Payment Date.
(C) FIXED RATE. (i) During the Fixed Rate Period, the Bonds
shall bear
interest at the Fixed Rate, which shall be determined by the
Remarketing Agent
not less than three (3) days prior to the effective date of the
Fixed Rate
Period. The Fixed Rate shall be the rate determined by the
Remarketing Agent
under then prevailing market conditions to be the minimum
interest rate which,
if borne by the Bonds on the effective date of such Fixed Rate,
would enable the
Remarketing Agent to sell the Bonds on such date at a price
(without regard to
accrued interest) equal to the principal amount thereof;
provided, however, that
in no event shall the Fixed Rate exceed the Cap Rate. The
Remarketing Agent
shall provide the Company and the Trustee with immediate
telephonic notice of
the Fixed Rate, as determined, which notice shall be promptly
confirmed in
writing. The Trustee shall (1) calculate the amount of interest
to be paid on
each Interest Payment Date in respect of the Fixed Rate Period
and (2) notify
the Company of the amount of interest to be paid on each such
Interest Payment
Date as soon as practicable but in any event no later than the
second Business
Day preceding the related Interest Payment Date.
(ii) Subject to compliance with the provisions set forth herein,
at any
time the Company, by written direction to the Issuer, the
Trustee, the Credit
Facility Provider and the Remarketing Agent, may elect that the
Bonds shall bear
interest at the Fixed Rate. Such direction (A) shall specify the
effective date
of such adjustment to the Fixed Rate (which date shall be a
Business Day not
earlier than the 30th day following the fifth Business Day after
the date of
receipt by the Trustee of such direction), and (B) must be
accompanied by an
opinion of Bond Counsel (which must also be confirmed in writing
as of the
effective date of the Fixed Rate) stating that such adjustment
to the Fixed Rate
is lawful under applicable law and permitted by this Indenture
and will not have
an adverse effect on the exclusion of the interest on the Bonds
from the gross
income of the owners thereof for federal income tax purposes.
Notwithstanding
anything in this Indenture to the contrary, no conversion to the
Fixed Rate
Period may occur if upon such conversion to the Fixed Rate there
will exist any
Pledged Bonds.
(iii) The Trustee shall give notice of an adjustment to the
Fixed Rate to
Bondholders (with a copy to the Company) by first-class mail,
postage prepaid,
not less than 30 days prior to the date the Fixed Rate Period is
to become
effective. Such notice shall state (A) that the interest rate on
the Bonds is to
be adjusted to the Fixed Rate (subject to receipt of the
confirming opinion of
Bond Counsel referred to in the immediately preceding paragraph
(ii) and to the
Company's ability to rescind its election as described in
Section 2.2(e)
hereof), (B) the date the Fixed Rate is
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to become effective and the duration of the Fixed Rate Period
(which shall be
until the Maturity Date), (C) that the Bonds are subject to
mandatory purchase
pursuant to Section 4.2(a) hereof on the date the Fixed Rate is
to become
effective whether or not such adjustment actually occurs and the
purchase price
therefor, and (D) the procedures for such purchase and the
payment of the
purchase price.
(D) DETERMINATIONS BINDING. The determination of each Weekly
Rate and the
Fixed Rate by the Remarketing Agent shall (in the absence of
manifest error) be
conclusive and binding upon the Remarketing Agent, the Trustee,
the Issuer, the
Company, the Credit Facility Provider and the Bondholders, and
each shall be
protected in relying thereon.
(E) RESCISSION OF ELECTION; FAILED ADJUSTMENT. Notwithstanding
anything
herein to the contrary, the Company may rescind any election by
it to adjust to
the Fixed Rate Period pursuant to Section 2.2(c)(ii) hereof
prior to the
effective date of such adjustment by giving written notice
thereof to the
Issuer, the Trustee, the Credit Facility Provider and the
Remarketing Agent
prior to such effective date. If the Trustee receives notice of
such rescission
prior to the time the Trustee has given notice to Bondholders of
the change in
Interest Rate Period pursuant to Section 2.2(c)(iii) hereof,
then such notice of
adjustment shall be of no force and effect and shall not be
given to
Bondholders. If the Trustee receives notice of such rescission
after the Trustee
has given notice to Bondholders of the change in Interest Rate
Period pursuant
to Section 2.2(c)(iii) hereof, or if an attempted adjustment to
the Fixed Rate
Period does not become effective for any other reason, then the
Interest Rate
Period for the Bonds shall remain the Weekly Rate Period and the
Trustee shall
immediately give notice to the Bondholders. Notwithstanding the
rescission of
any notice to adjust to the Fixed Rate Period, or if an
attempted adjustment to
the Fixed Rate Period does not become effective for any other
reason, if notice
has been given to Bondholders pursuant to Section 2.2(c)(iii),
the Bonds shall
be subject to mandatory purchase as specified in such
notice.
SECTION 2.3. EXECUTION; LIMITED OBLIGATION. The Bonds shall be
executed on
behalf of the Issuer with the manual or facsimile signatures of
the President of
its Board of Directors and its Secretary and shall have
impressed or imprinted
thereon the official seal of the Issuer or a facsimile thereof.
All authorized
facsimile signatures shall have the same force and effect as if
manually signed.
In case any official whose signature or a facsimile of whose
signature shall
appear on the Bonds shall cease to be such official before the
delivery of such
Bonds, such signature or such facsimile shall nevertheless be
valid and
sufficient for all purposes, the same as if such official had
remained in office
until delivery. The Bonds may be signed on behalf of the Issuer
by such persons
who, at the time of the execution of such Bonds, are duly
authorized or hold the
appropriate offices of the Issuer, although on the date of the
Bonds such
persons were not so authorized or did not hold such offices.
The Bonds, together with premium, if any, and interest thereon,
shall be
special, limited obligations of the Issuer, payable solely from
the Revenues
(except to the extent paid out of moneys attributable to Bond
proceeds and the
income from the temporary investment thereof), and shall be a
valid claim of the
owners from time to time thereof only against the Bond Fund and
other moneys
held by the Trustee and the Revenues, which Revenues shall be
used for no other
purpose than to pay (or to reimburse the Credit Facility
Provider for the
payment of) the
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principal of, premium, if any, and interest on the Bonds, except
as may be
otherwise expressly authorized in this Indenture or the
Agreement. The
obligation to pay the purchase price of the Bonds pursuant to
Sections 4.1 and
4.2 hereof shall be a special, limited obligation of the Issuer,
payable solely
from the moneys described in Section 6.11(b) hereof, and shall
be a valid claim
of the owners only against the Bond Purchase Fund, which Fund
shall be used for
no other purpose than to pay (or, under the circumstances
provided herein, to
reimburse the Credit Facility Provider for the payment of) the
purchase price of
Bonds pursuant to Sections 4.1 and 4.2 hereof, except as may be
otherwise
expressly authorized in this Indenture or the Agreement.
THE OBLIGATIONS OF THE ISSUER HEREUNDER AND UNDER THE BONDS
SHALL NOT BE
GENERAL OBLIGATIONS OF THE ISSUER NOR SHALL THEY BE PAYABLE IN
ANY MANNER BY
TAXATION. NEITHER THE STATE NOR ANY POLITICAL SUBDIVISION OR
AGENCY THEREOF,
INCLUDING THE ISSUER, SHALL BE OBLIGATED TO PAY THE OBLIGATIONS
HEREUNDER, THE
PRINCIPAL OR PURCHASE PRICES OF, PREMIUM, IF ANY, OR INTEREST ON
THE BONDS, OR
THE OTHER COSTS INCIDENT THERETO, EXCEPT FROM THE REVENUES AND
RECEIPTS PLEDGED
THEREFOR, AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER
OF THE STATE OR
ANY POLITICAL SUBDIVISION OR AGENCY THEREOF, INCLUDING THE
ISSUER (WHICH HAS NO
TAXING POWER), IS PLEDGED TO THE PAYMENT OF THE OBLIGATIONS
HEREUNDER OR UNDER
THE BONDS. NO OWNER OF ANY OF THE BONDS HAS THE RIGHT TO COMPEL
ANY EXERCISE OF
THE TAXING POWER OF THE STATE OR ANY POLITICAL SUBDIVISION OR
AGENCY THEREOF TO
PAY THE BONDS OR THE INTEREST OR THE PREMIUM, IF ANY, THEREON.
THE BONDS DO NOT
AND SHALL NEVER CONSTITUTE OR GIVE RISE TO ANY PECUNIARY
LIABILITY OF THE ISSUER
OR A CHARGE UPON ITS GENERAL CREDIT. THE BONDS DO NOT AND SHALL
NEVER CONSTITUTE
OR EVIDENCE AN INDEBTEDNESS OF THE ISSUER, THE STATE OR ANY
POLITICAL
SUBDIVISION THEREOF OR A LOAN OF CREDIT THEREOF WITHIN THE
MEANING OF ANY
CONSTITUTIONAL OR STATUTORY PROVISION.
SECTION 2.4. AUTHENTICATION. No Bond shall be valid or
obligatory for any
purpose or entitled to any security or benefit under this
Indenture unless and
until a certificate of authentication on such Bond substantially
in the form
hereinabove set forth shall have been duly executed by the
Trustee, and such
executed certificate of the Trustee upon any such Bond shall be
conclusive
evidence that such Bond has been authenticated and delivered
under this
Indenture. The Trustee's certificate of authentication on any
Bond shall be
deemed to have been executed by it if manually signed by an
authorized officer
of the Trustee, but it shall not be necessary that the same
authorized officer
execute the certificate of authentication on all of the Bonds
issued hereunder.
Each Bond shall bear the date of its authentication, which date
of
authentication shall be inserted by the Trustee in the place
provided for such
purpose in the form of certificate of authentication of the
Trustee to appear on
each Bond.
SECTION 2.5. FORM AND PLACE OF PAYMENT OF BONDS. The Bonds
issued under
this Indenture shall be substantially in the form hereinabove
set forth with
such variations, omissions and insertions as are permitted or
required by this
Indenture. The principal and purchase price of and premium, if
any, on the Bonds
shall be payable in lawful money of the United States of America
only at the
Principal Office of the Trustee. Payment of interest on any Bond
due on any
regularly scheduled Interest Payment Date shall be made to the
Registered Owner
thereof as of the Record Date next preceding such Interest
Payment Date.
Payments of interest on any Bond shall be made in next day funds
by check of the
Trustee mailed on the applicable Interest Payment Date to the
Registered Owner
thereof as of the Record Date next preceding such
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Interest Payment Date at the address of such Registered Owner as
it appears on
the registration books of the Issuer maintained by the Trustee,
as bond
registrar, or at such other address as is furnished to the
Trustee in writing by
such Registered Owner no later than the close of business on
such Record Date;
provided, that payments of interest on any Bond in respect of
the Weekly Rate
Period shall be made by wire transfer of immediately available
funds to the
Registered Owner of such Bond to an account at a financial
institution located
in the continental United States, if such Registered Owner shall
have given
written notice to the Trustee by the applicable Record Date
identifying the
location and number of the account to which such payment should
be wired;
provided further, that in respect of the Fixed Rate Period
payments of interest
on any Bond may be made by wire transfer of immediately
available funds to the
Registered Owner of such Bond to an account at a financial
institution located
in the continental United States in the event that such
Registered Owner is the
registered owner of at least $1,000,000 in aggregate principal
amount of the
Bonds as of the close of business on the Record Date immediately
preceding the
applicable Interest Payment Date and such Registered Owner shall
have given
written notice to the Trustee on or before the second Business
Day immediately
preceding such Record Date, directing the Trustee to make such
payments of
interest by wire transfer and identifying the location and
number of the account
to which such payments should be wired.
SECTION 2.6. DELIVERY OF THE BONDS. Upon the execution and
delivery of this
Indenture, the Issuer shall execute and deliver to the Trustee
and the Trustee
shall deliver the Bonds to, or at the direction of, the
Underwriter as directed
by the Issuer as hereinafter in this Section 2.6 provided.
Prior to the delivery of any of the Bonds there shall be filed
with the
Trustee:
1. A copy, duly certified by the Secretary of the Issuer, of
the
proceedings of the governing body of the Issuer authorizing the
execution
and delivery of the Agreement, the Tax Agreement and this
Indenture and the
issuance of the Bonds.
2. The original Fronting Credit Facility, the original
Confirming
Credit Facility and original executed counterparts of this
Indenture, the
Agreement, the Tax Agreement, the Remarketing Agreement, the
Credit
Agreement and the Pledge Agreement.
3. A written request and authorization to the Trustee by the
Issuer
and signed by the President of the Board of Directors of the
Issuer to
authenticate and deliver the Bonds to, or at the direction of,
the
Underwriter upon payment to the Trustee, but for the account of
the Issuer,
of a sum specified in such written request and authorization
representing
the principal proceeds of the Bonds plus accrued interest, if
any, thereon.
4. A closing certificate of the Issuer, in form and
substance
satisfactory to Bond Counsel.
5. A closing certificate of the Company, in form and
substance
satisfactory to Bond Counsel.
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<PAGE>
6. A closing certificate of the Fronting Credit Facility
Provider, in
form and substance satisfactory to Bond Counsel.
7. A closing certificate of the Confirming Credit Facility
Provider,
in form and substance satisfactory to Bond Counsel.
8. Documents and evidence to establish the existence and good
standing
of the Company, the authorization of the transactions
contemplated by this
Indenture and the taking of all proceedings in connection
therewith, in
form and substance satisfactory to Bond Counsel.
9. An Information Return for Tax Exempt Private Activity
Bonds
required by Section 149(e) of the Code.
10. All other such documents, proceedings and showings as shall
be
requested by Bond Counsel.
11. Opinions of counsel to the Company, in form and
substance
satisfactory to Bond Counsel.
12. An opinion of counsel to the Issuer, in form and
substance
satisfactory to Bond Counsel.
13. An opinion of counsel to the Fronting Credit Facility
Provider, in
form and substance satisfactory to Bond Counsel.
14. An opinion of counsel to the Confirming Credit Facility
Provider,
in form and substance satisfactory to Bond Counsel.
15. An opinion of Bond Counsel to the effect that interest on
the
Bonds is not includable in the gross income of the owners
thereof for
federal income tax purposes (other than any owner who is a
"substantial
user" of the Project or a "related person") but that such
interest
constitutes a preference item in computing the federal
alternative minimum
tax.
SECTION 2.7. MUTILATED, LOST, STOLEN OR DESTROYED BONDS. In the
event any
Bond is mutilated, lost, stolen, or destroyed, the Trustee may
authenticate a
new Bond duly executed on behalf of the Issuer of like
Authorized Denomination
as that mutilated, lost, stolen or destroyed bearing a number
not
contemporaneously then outstanding; provided, that, in the case
of any mutilated
Bond, such mutilated Bond shall first be surrendered to the
Trustee and in the
case of any lost, stolen or destroyed Bond, there shall be first
furnished to
the Issuer, the Trustee and the Company evidence of such loss,
theft or
destruction satisfactory to the Issuer, the Trustee and the
Company, together
with indemnity, insurance or surety satisfactory to each of
them. In the event
any such Bond shall have matured or is to mature within fifteen
(15) days of the
request for a new Bond, instead of issuing a duplicate Bond, the
Issuer may pay
the same on the appropriate
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date. The Issuer and the Trustee may charge the owner of such
Bond with their
reasonable fees and expenses in this connection.
SECTION 2.8. REGISTRATION, TRANSFER AND EXCHANGE OF BONDS;
PERSONS TREATED
AS OWNERS. The Issuer shall cause books for the registration and
for the
registration of transfer of the Bonds as provided in this
Indenture to be kept
by the Trustee. The Issuer shall prepare and deliver to the
Trustee, and the
Trustee shall keep custody of, a supply of Bonds duly executed
on behalf of the
Issuer, as provided in Section 2.3 hereof, for use in the
transfer and exchange
of Bonds. The Trustee is hereby authorized and directed to
complete (to the
extent not already completed) such forms of Bonds as to
principal amounts,
registered owners and numbers in effecting transfers and
exchanges of Bonds as
provided herein. The principal of, premium, if any, and interest
on any Bond
shall be payable only to the Registered Owner or his legal
representative duly
authorized in writing, and no registration to "bearer" shall be
permitted. Upon
surrender for transfer of any Bond at the Principal Office of
the Trustee,
accompanied by an instrument of assignment or transfer, which
instrument of
assignment or transfer shall be in the form provided on the
Bonds or in such
other form acceptable to the Trustee, duly executed by the
Registered Owner or
his attorney duly authorized in writing, the Issuer shall
execute and the
Trustee shall authenticate and deliver in the name of the
transferee or
transferees a new Bond or Bonds in Authorized Denominations, for
a like
aggregate principal amount, bearing numbers not
contemporaneously then
outstanding.
Bonds may be exchanged at the Principal Office of the Trustee
for a like
aggregate principal amount of Bonds of other Authorized
Denominations. The
Trustee shall authenticate and deliver Bonds duly executed on
behalf of the
Issuer which the Bondholder making the exchange is entitled to
receive, bearing
numbers not contemporaneously then outstanding.
The Trustee shall not be required to transfer or exchange any
Bond after
notice calling such Bond or portion thereof for redemption prior
to maturity has
been given as herein provided, or during the period of fifteen
(15) days next
preceding the giving of such notice of redemption, except a
transfer upon a
tender of a Bond for purchase pursuant to Section 4.1 or 4.2
hereof.
In each case (except as provided in Section 3.2 hereof) the
Trustee shall
require the payment by the Bondholder requesting exchange or
transfer of any tax
or other governmental charge required to be paid with respect to
such exchange
or transfer, but otherwise no charge shall be made to the
Bondholder for such
exchange or transfer.
The Issuer, the Trustee and the Company may deem and treat the
Registered
Owner of any Bond as the absolute owner thereof for the purpose
of receiving
payment of or on account of principal and premium, if any, and
interest thereon
and for all other purposes, and none of the Issuer, the Trustee
or the Company
shall be affected by any notice to the contrary.
If the Trustee and the Issuer, at the written direction of the
Company,
enter into an agreement with a Securities Depository as provided
in Section 2.11
hereof, the Issuer shall execute and the Trustee shall, in
accordance with
Section 2.4 hereof, authenticate a Bond to be held by such
Securities
Depository, which (i) shall be denominated in an amount equal to
the aggregate
principal amount of Bonds to be held by the Securities
Depository (provided
that,
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unless such Bond is being issued on the Issue Date, the Trustee
has received a
like aggregate principal amount of Bonds for transfer in
accordance with this
Section 2.8), (ii) shall be registered in the name of the
Securities Depository
or its nominee in accordance with this Section 2.8, (iii) shall
be delivered by
the Trustee to the Securities Depository or pursuant to the
Securities
Depository's instructions, and (iv) shall bear a legend
substantially to the
effect that unless the Bond is presented by an authorized
representative of the
Securities Depository to the Issuer or its agent for
registration of transfer,
exchange or payment, any transfer, exchange, pledge or other use
for value or
otherwise is wrongful.
Notwithstanding any other provision of this Section 2.8, subject
to the
provisions of the immediately succeeding paragraph, any Bond
registered in the
name of a Securities Depository or its nominee may be
transferred, in whole but
not in part, in accordance with this Section 2.8, to a nominee
(or a different
nominee) of the Securities Depository, or to the Securities
Depository, or a
successor Securities Depository selected or approved by the
Company, or to a
nominee of such successor Securities Depository.
If the Securities Depository which is the record owner (or whose
nominee is
the record owner) of the Bonds notifies the Issuer, the Trustee
or the Company
that it is unwilling or unable to continue as record owner of
the Bonds, or if
such Securities Depository shall no longer be eligible or in
good standing under
the Securities Exchange Act of 1934, as amended, or other
applicable statute or
regulation, the Issuer and the Trustee, upon written direction
of the Company,
shall appoint a successor Securities Depository. If a successor
Securities
Depository is not appointed within ninety (90) days after the
Company receives
notice or becomes aware of the events stated in the preceding
sentence, or if
the Issuer and the Trustee, upon written direction of the
Company, elect not to
appoint a successor Securities Depository, upon surrender for
transfer of the
Bond registered in the name of the Securities Depository or its
nominee, the
Issuer shall execute, and the Trustee shall authenticate, a new
Bond or Bonds,
for a like aggregate principal amount, bearing numbers not
contemporaneously
then outstanding, which shall be in Authorized Denominations and
registered in
the name of the transferee or transferees specified in written
instructions
delivered pursuant to the last two sentences of this paragraph,
in accordance
with this Section 2.8. The Issuer and the Trustee shall
discontinue an agreement
with a Securities Depository within a reasonable amount of time
after receipt of
written direction from the Company. In such event, the Issuer
shall execute and
the Trustee shall authenticate, upon receipt of the Bond
registered in the name
of the Securities Depository or its nominee, a new Bond or
Bonds, for a like
aggregate principal amount, bearing numbers not
contemporaneously then
outstanding, in Authorized Denominations and registered in the
name of a
transferee or transferees specified in written instructions
delivered pursuant
to the following two sentences, in accordance with this Section
2.8. Upon any
surrender of Bonds for transfer pursuant to this paragraph, the
Securities
Depository shall specify in written instructions delivered to
the Issuer, the
Trustee and the Company, the name of the transferee or
transferees and the
Authorized Denominations of the new Bonds. If the transferee
specified in such
instructions is not a successor Securities Depository described
above in this
paragraph, then the transferees shall be the beneficial owners
of the Bonds
specified in such instructions and the Trustee shall deliver new
Bonds to such
transferees in Authorized Denominations proportionate to their
beneficial
interest in the Bonds as specified in said instructions.
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<PAGE>
SECTION 2.9. CANCELLATION OF BONDS. Whenever any Outstanding
Bond shall be
delivered to the Trustee for cancellation pursuant to this
Indenture, upon full
or partial payment of the principal amount represented thereby,
or for
replacement pursuant to Section 2.7 hereof, or upon exchange or
transfer
pursuant to Section 2.8 hereof, or in accordance with Sections
3.2,4.1, 4.2 and
6.11 hereof, such Bond shall be promptly canceled and disposed
of by the Trustee
and counterparts of a certificate evidencing such cancellation
and disposition
shall be furnished by the Trustee to the Issuer and the
Company.
SECTION 2.10. APPLICATION OF PROCEEDS OF BONDS. There being no
accrued
interest, the proceeds of the issuance and sale of the Bonds
(net of
underwriting discount, if any) shall be deposited with the
Trustee in the
Construction Fund pursuant to Section 6.7 hereof.
SECTION 2.11. BOOK-ENTRY SYSTEM. The Trustee and the Issuer, at
the
direction of the Company, may from time to time enter into, and
discontinue, an
agreement with a "clearing agency" (securities depository)
registered under
Section 17A of the Securities Exchange Act of 1934, as amended
(a "Securities
Depository"), which is the owner of the Bonds, to establish
procedures with
respect to the Bonds, not inconsistent with the provisions of
this Indenture;
provided, however, that any such agreement may provide:
(a) that such Securities Depository is not required to present a
Bond
to the Trustee in order to receive a partial payment of
principal or
purchase price;
(b) that a legend shall appear on each Bond so long as the Bonds
are
subject to such agreement; and
(c) that different provisions for notice to such Securities
Depository
may be set forth therein.
So long as any such agreement with a Securities Depository is in
effect,
the term "owner" as it appears in Section 3.1(c) hereof (but not
for any other
provision of this Indenture, except only as specifically
provided herein), and
in Section 7.1(b) of the Agreement and as it appears in Section
5.3 of the
Agreement, shall be deemed to include the Beneficial Owner.
So long as an agreement with a Securities Depository is in
effect, the
Issuer, the Company, the Trustee and any paying agent or bond
registrar shall
not have any responsibility or liability with respect to the
payment of
principal, purchase price, premium, if any, or interest on the
Bonds to the
Beneficial Owners or for maintaining, supervising or reviewing
any records
relating to such beneficial ownership interests or any payments
made to such
Beneficial Owners.
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<PAGE>
ARTICLE III
REDEMPTION OF BONDS BEFORE MATURITY
SECTION 3.1. CERTAIN REDEMPTION DATES AND PRICES.
(A) OPTIONAL REDEMPTION. On any Business Day during a Weekly
Rate Period
and on the Fixed Rate Adjustment Date, the Bonds shall be
subject to optional
redemption by the Issuer with Available Moneys, at the written
direction of the
Company and with the written consent of the Credit Facility
Provider, in whole
or in part, at 100% of the principal amount thereof, plus
accrued interest, if
any, to the redemption date.
During the Fixed Rate Period, the Bonds shall be subject to
optional
redemption by the Issuer, at the written direction of the
Company, in whole or
in part at any time after the applicable No-Call Period
specified below, at the
respective redemption prices set forth below expressed as
percentages of the
principal amount of the Bonds called for redemption (such prices
declining each
year until such redemption price is equal to 100% of the
principal amount of the
Bonds), plus accrued interest, if any, to the redemption
date:
<TABLE>
<CAPTION>
Length of
Fixed Rate No-Call Redemption No
Period Period Price Premium
-------------------- -------------------------
-------------------------------- ------------------------
<S> <C> <C> <C>
10 or more years First 7 years after Fixed 8th year at 102%
(reducing 1% on 10th year and thereafter
Rate Adjustment Date each anniversary date to par)
5 or more years (but First 5 years after Fixed 6th year at 102%
(reducing 1% on 8th year and thereafter
less than 10) Rate Adjustment Date each anniversary date to
par)
</TABLE>
If the length of the Fixed Rate Period is less than five (5)
years, the Bonds
shall be subject to optional redemption at the direction of the
Company only
upon the occurrence of certain events described in Section
3.1(b) relating to
damage, destruction, condemnation, sale, economic viability or
use of the
Project.
At the election of the Company, contained in the direction to
adjust the
interest rate on the Bonds to the Fixed Rate from the Company to
the Issuer, the
Trustee, the Credit Facility Provider and the Remarketing Agent
described in
Section 2.2(c)(ii) hereof, the Bonds may be subject to optional
redemption
during the Fixed Rate Period on terms different from those set
forth above and
as shall be specified in such direction, but only if such
direction shall be
accompanied by an opinion of Bond Counsel to the effect that
such change in the
redemption features is authorized and permitted by the Agreement
and this
Indenture and will not adversely affect the validity of the
Bonds or the
exclusion of the interest on the Bonds from the gross income of
the owners
thereof for federal income tax purposes.
(B) EXTRAORDINARY OPTIONAL REDEMPTION. The Bonds shall be
subject to
extraordinary optional redemption by the Issuer with Available
Moneys, at the
written direction
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<PAGE>
of the Company, on any date in whole but not in part, at a
redemption price of
100% of the principal amount thereof plus accrued interest, if
any, to the
redemption date, within one hundred and eighty (180) days after
the Company has
notice or actual knowledge of the occurrence of any one of the
following events:
(i) The Project shall have been damaged or destroyed (in whole
or in
part) by fire or other casualty to such extent that in the
opinion of the
Company, in its sole discretion, it is not practicable or
desirable to
rebuild, repair or restore the Project; or
(ii) Title to, or the temporary use of, all or substantially all
the
Project shall have been taken under the exercise of the power of
eminent
domain by any governmental authority, or person, firm or
corporation acting
under governmental authority; or
(iii) Changes in the economic availability of raw materials,
operating
supplies or facilities necessary for the operation of the
Project shall
have occurred or such technological or environmental or other
changes shall
have occurred which in the Company's judgment render the
continued
operation of the Project uneconomic.
(C) MANDATORY REDEMPTION UPON DETERMINATION OF TAXABILITY. The
Bonds shall
be subject to mandatory redemption by the Issuer with Available
Moneys, as a
whole or in part, at a redemption price of 100% of the principal
amount thereof
plus accrued interest, if any, to the redemption date, on any
date within one
hundred and eighty (180) days after the Company has notice or
actual knowledge
of a final determination by the Internal Revenue Service or a
court of competent
jurisdiction as a result of a proceeding in which the Company
participates to
the degree it deems sufficient, which determination the Company,
in its
discretion, does not contest by an appropriate proceeding, that,
as a result of
failure by the Company to observe any covenant, agreement or
representation by
the Company in the Agreement, the interest payable on the Bonds
or any of them
is includable for federal income tax purposes in the gross
income of any owner
of a Bond (other than an owner who is a "substantial user" of
the Project or a
"related person" within the meaning of Section 147 of the Code
and the
applicable regulations thereunder). Upon the occurrence of the
event stated in
this Section 3.1(c), the Bonds will be redeemed in whole unless
the Company
delivers to the Trustee, together with the applicable notice of
prepayment
required by Section 7.5 of the Agreement, at the Company's
expense, an opinion
of Bond Counsel upon which the Trustee may rely to the effect
that redemption of
a portion of the Bonds outstanding would have the result that
interest payable
on the Bonds remaining outstanding after such redemption would
not be includable
for federal income tax purposes in the gross income of any owner
of a Bond
(other than an owner who is a "substantial user" of the Project
or a "related
person" within the meaning of Section 147 of the Code and the
applicable
regulations thereunder), and in such event the Bonds or portions
thereof (in
Authorized Denominations which will result in the remaining
portion of any such
Bond being in an Authorized Denomination) shall be redeemed at
such times and in
such amounts as Bond Counsel shall so direct in such
opinion.
(D) MANDATORY REDEMPTION UPON PROCEEDS REMAINING IN CONSTRUCTION
FUND. The
Bonds shall be subject to mandatory redemption by the Issuer
with Available
Moneys, as a whole or in part (in Authorized Denominations) to
the extent of
moneys remaining in the
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<PAGE>
Construction Fund, at a redemption price of 100% of the
principal amount thereof
plus accrued interest, if any, to the redemption date, on any
date within ninety
(90) days after the Company has notice or actual knowledge that
proceeds of the
Bonds, including income from the investment thereof, shall have
remained after
completion of the Project and the payment of the Cost of the
Project. Upon the
occurrence of the event stated in this Section 3.1(d), the
principal amount of
the Bonds to be redeemed will be a principal amount equal to the
lowest
Authorized Denomination equal to or in excess of the remaining
proceeds of the
Bonds, including income from the investment thereof.
(E) MANDATORY REDEMPTION UPON UNENFORCEABILITY OF AGREEMENT. The
Bonds
shall be subject to mandatory redemption by the Issuer with
Available Moneys in
whole and not in part, at a redemption price of 100% of the
principal amount
thereof plus accrued interest, if any, to the redemption date,
on any date
within one hundred and eighty (180) days after the Company has
notice or actual
knowledge that as a result of any changes in the Constitution of
the State or
the Constitution of the United States of America or by
legislative or
administrative action (whether state or federal) or by final
decree, judgment or
order of any court or administrative body (whether state or
federal), the
Agreement shall have become void or unenforceable or impossible
of performance
in accordance with the intent and purposes of the parties as
expressed in the
Agreement.
(F) PURCHASE IN LIEU OF OPTIONAL REDEMPTION. Notwithstanding
anything to
the contrary stated herein, the Company may elect to purchase
any Bonds with
Available Moneys that have been called for optional redemption
as described
above on the redemption date by giving the Trustee, the Issuer,
the Credit
Facility Provider and the Remarketing Agent written notice at
least two Business
Days prior to the date the Bonds are to be redeemed. Any Bonds
so purchased by
the Company shall become Company Bonds.
(G) DIRECTION TO TRUSTEE TO CALL BONDS FOR REDEMPTION. The
Issuer hereby
directs the Trustee to call Bonds for redemption when it shall
have been
notified in writing by the Company, pursuant to Section 7.3 of
the Agreement, to
do so and to mail a copy of the notice of redemption to the
Company, the
Remarketing Agent and the Credit Facility Provider at the same
time as the
Trustee mails such notice of redemption to the owners of the
Bonds that have
been called for redemption pursuant to Section 3.3 hereof.
(H) SOURCES OF AVAILABLE MONEYS FOR REDEMPTION; CREDIT FACILITY.
So long as
a Credit Facility is in effect, the Trustee shall, in accordance
with Section
6.4 of this Indenture, take such action as is required under
such Credit
Facility to realize moneys thereunder to prepay the principal of
and accrued
interest on the Bonds payable under this Section 3.1 in
accordance with the
terms of such Credit Facility.
SECTION 3.2. PARTIAL REDEMPTION OF BONDS. Upon a partial
redemption of
Bonds, the Bonds to be redeemed shall be selected in such manner
as shall be
designated by the Trustee; provided that Pledged Bonds and
Company Bonds, in
that order, shall be first subject to redemption prior to any
other Bonds which
may be selected for redemption. If any Bond is called for
redemption in part
only, the owner of such Bond shall forthwith surrender such Bond
to the Trustee
(1) for payment of the redemption price (including the premium,
if any, and
interest, if any, to the date fixed for redemption) of the
amount called for
redemption, and (2) for
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<PAGE>
exchange, without charge to the owner thereof, for a new Bond or
Bonds of the
aggregate principal amount of the unredeemed balance of the
principal amount of
such Bond, provided that after the redemption date all Bonds
must be in
Authorized Denominations. If the owner of any Bond called for
redemption in part
only shall fail to present such Bond to the Trustee for payment
and exchange as
aforesaid, such Bond shall, nevertheless, become due and payable
on the
redemption date to the extent so called for redemption (and to
that extent
only); interest shall cease to accrue on the portion of the
principal amount of
such Bond called for redemption on and after the date fixed for
redemption and
(Available Moneys in an amount sufficient for the payment of the
redemption
price having been deposited with the Trustee, and being
available for the
redemption of said amount on the date fixed for redemption) such
Bond shall not
be entitled to the benefit or security of this Indenture to the
extent of the
portion of its principal amount (and accrued interest thereon to
the date fixed
for redemption) called for redemption nor shall new Bonds be
thereafter issued
corresponding to said amount.
SECTION 3.3. NOTICE OF REDEMPTION.
(A) OFFICIAL NOTICE. Notice of the call for any redemption shall
be given
by the Trustee, at the direction of the Company (which direction
shall be in
writing), by mailing a copy of the redemption notice by
first-class mail,
postage prepaid, at least thirty (30) days, but not more than
sixty (60) days,
prior to the date fixed for redemption to the Registered Owner
of each Bond to
be redeemed as a whole or in part at the address shown on the
registration books
of the Issuer maintained by the Trustee; provided, however, that
failure to give
such notice by mailing, or any defect therein, shall not affect
the validity of
any proceedings for the redemption of any Bond, or portion
thereof with respect
to which no such failure or defect has occurred. In addition,
the Trustee may
give such other notice or notices as may be recommended in
releases, letters,
pronouncements or other writings of the Securities and Exchange
Commission and
the Municipal Securities Rulemaking Board. No defect in or delay
or failure in
giving
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