1
EXHIBIT 4.8
LOAN AGREEMENT
BETWEEN
________________________________________________________________________________
________________________________________________________________________________
CITY OF LIGONIER, INDIANA
AND
XXXXXX MANUFACTURING COMPANY
________________________________________________________________________________
________________________________________________________________________________
RELATING TO
$6,300,000
CITY OF LIGONIER, INDIANA
ECONOMIC DEVELOPMENT REVENUE BONDS
(XXXXXX MANUFACTURING COMPANY PROJECT)
SERIES 1992
DATED AS OF JUNE 1, 1992
2
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS.......................................................................... 3
ARTICLE II. REPRESENTATIONS...................................................................... 5
SECTION 2.1. Representations by the Company....................................................... 5
SECTION 2.2. Representations of the Issuer........................................................ 9
ARTICLE III. LOAN AND REPAYMENT................................................................... 11
SECTION 3.1. Amount and Evidence of Loan.......................................................... 11
SECTION 3.2. Loan Repayments...................................................................... 11
SECTION 3.3. Mandatory and Optional Prepayments of the Promissory Note............................ 11
SECTION 3.4. Additional Payment Obligations of the Company........................................ 12
SECTION 3.5. Payment of Issuer Expenses........................................................... 13
SECTION 3.6. Administrative Expenses.............................................................. 13
SECTION 3.7. Letter of Credit; Alternate Credit Facility.......................................... 13
SECTION 3.8. Credit for Bonds Surrendered......................................................... 14
ARTICLE IV. SECURITY INTEREST.................................................................... 15
SECTION 4.1. Priority and Maintenance of Lien; Recording.......................................... 15
SECTION 4.2. Further Assurances; After-acquired Property.......................................... 15
SECTION 4.3. Company Duties Under Indenture....................................................... 15
ARTICLE V. CONSTRUCTION OF THE PROJECT.......................................................... 16
SECTION 5.1. Disbursements from the Construction Fund............................................. 16
SECTION 5.2. Obligation of the Company to Complete the Project and to Pay Costs in Event
Construction Fund Insufficient....................................................... 16
SECTION 5.3. Investment of Construction Fund, Bond Fund and Bond Purchase Fund Moneys............. 16
SECTION 5.4. Certificate as to Completion......................................................... 17
ARTICLE VI. USE OF PROJECT, MAINTENANCE, TAXES AND INSURANCE..................................... 18
SECTION 6.1. Use, Maintenance and Modifications of Project by Company............................. 18
SECTION 6.2. Taxes, Other Governmental Charges and Utility Charges................................ 18
SECTION 6.3. Insurance............................................................................ 19
i
3
Page
ARTICLE VII. DAMAGE, DESTRUCTION AND CONDEMNATION................................................. 20
ARTICLE VIII. SPECIAL COVENANTS.................................................................... 21
SECTION 8.1. Unconditional Obligation............................................................. 21
SECTION 8.2. Right of Access to the Project....................................................... 21
SECTION 8.3. Maintenance of Corporation Existence and Qualification............................... 21
SECTION 8.4. Granting Easements................................................................... 22
SECTION 8.5. Covenant as to Non-Impairment of Tax-Exempt Status................................... 22
SECTION 8.6. Indemnity, Expenses.................................................................. 23
ARTICLE IX. ASSIGNMENT, LEASING, EQUIPMENT....................................................... 25
SECTION 9.1. Transfer, Assignment and Leasing..................................................... 25
SECTION 9.2. Substitution and Removal of Machinery and Equipment.................................. 25
SECTION 9.3. Installation of Company's Own Machinery and Equipment................................ 26
ARTICLE X. EVENTS OF DEFAULT AND REMEDIES....................................................... 27
SECTION 10.1. Events of Default.................................................................... 27
SECTION 10.2. Remedies on Default.................................................................. 28
SECTION 10.3. No Remedy Exclusive.................................................................. 28
SECTION 10.4. Agreement to Pay Attorneys' Fees and Expenses........................................ 29
SECTION 10.5. No Additional Waiver Implied by One Waiver........................................... 29
ARTICLE XI. PAYMENT OF SURPLUS BOND PROCEEDS FROM THE BOND FUND.................................. 30
SECTION 11.1. Surplus Bond Proceeds................................................................ 30
ARTICLE XII. THE BONDS............................................................................ 31
SECTION 12.1. Issuance of the Series 1992 Bonds.................................................... 31
SECTION 12.2. Additional Bonds..................................................................... 31
SECTION 12.3. Compliance with Indenture............................................................ 31
SECTION 12.4. Consent to Issuer's Pledge........................................................... 31
SECTION 12.5. Rights of Trustee Hereunder.......................................................... 31
SECTION 12.6. Amendments to Indenture and this Agreement........................................... 32
ii
4
Page
ARTICLE XIII. MISCELLANEOUS........................................................................ 33
SECTION 13.1. Amounts Remaining in Funds........................................................... 33
SECTION 13.2. Rights of the Bank................................................................... 33
SECTION 13.3. Notices.............................................................................. 33
SECTION 13.4. Bondholders' Action.................................................................. 34
SECTION 13.5. Binding Effect....................................................................... 34
SECTION 13.6. Severability......................................................................... 35
SECTION 13.7. Captions............................................................................. 35
SECTION 13.8. Interpretation....................................................................... 35
SECTION 13.9. Execution in Counterparts............................................................ 35
iii
5
LOAN AGREEMENT
THIS LOAN AGREEMENT is entered into as of June 1, 1992, between the
CITY OF LIGONIER, INDIANA, (the "Issuer"), a municipal corporation organized
under the laws of the State of Indiana and XXXXXX MANUFACTURING COMPANY, a
Michigan corporation (the "Company").
WHEREAS, the Indiana Code Title 36, Article 7, Chapters 11.9 and 12, as
amended (the "Act"), declares that the financing of economic development
facilities constitutes a public purpose; and
WHEREAS, the Company has applied to the Issuer for a Loan (as
hereinafter defined) of $6,300,000 to finance the Costs of the Project (as
hereinafter defined); and
WHEREAS, the Issuer has determined that granting the Loan request by
the Company and issuing the Series 1992 Bonds (as hereinafter defined) will
promote and serve the intended purposes of and in all respects will conform to
the provisions and requirements of the Act; and
WHEREAS, the Issuer and the Company desire to set forth the terms and
conditions of the Loan;
GRANTING CLAUSES
In consideration of the loan of the proceeds of the Series 1992 Bonds
to be made by the Issuer, the acceptance of the Series 1992 Promissory Note
attached as Exhibit C hereto (the "Promissory Note") by the Issuer, and of other
good and valuable consideration, the receipt and sufficiency whereof are hereby
acknowledged, and in order to secure the payment of the principal of, premium,
if any, and interest payable on the Promissory Note, any additional notes issued
hereunder and any notes issued in substitution therefore (herein collectively
referred to as the "Notes") and the performance of all the covenants of the
Company contained herein, the Company has executed and delivered this Loan
Agreement and by these presents does grant a security interest to the Issuer and
its successors forever, in all the Company's right, title, and interest in, to
and under any and all of the following described property (herein called the
"Trust Estate");
DIVISION I
Any and all property of every kind and nature from time to time
hereafter, by delivery or by writing of any kind, conveyed, pledged or
transferred for and as additional security hereunder by the Company or by anyone
on its behalf to the Issuer or the Trustee, including without limitation, funds
of the Company, other than those on deposit in the Rebate Fund, held by the
Trustee as security for the Bonds;
6
DIVISION II
All moneys and securities other than those on deposit in the Rebate
Fund, from time to time held by the Issuer or the Trustee under the terms of
this Agreement or the Indenture;
TO HAVE AND TO HOLD all and singular the above-described Trust Estate,
whether now owned or hereafter acquired, unto the Issuer, its successors and
assigns forever, provided, however, that this Agreement is executed upon the
express condition that if the Company shall pay or cause to be paid all
indebtedness secured hereby and shall keep, perform and observe all and singular
the covenants and promises expressed in the Note and in this Agreement, to be
kept, performed and observed by the Company, then this Agreement and the rights
granted hereunder shall cease, determine and be void; otherwise to remain in
full force and effect.
NOW, THEREFORE, in consideration of the premises and of the covenants
and undertakings herein expressed, the parties hereto agree as follows:
2
7
ARTICLE I.
DEFINITIONS
All terms used herein which are defined in the Indenture identified
below shall have the meanings set forth, which definitions are by this reference
incorporated herein and made a part of this Agreement. In addition to the terms
elsewhere defined in this Agreement, the words "this Agreement" as used herein
shall mean this Loan Agreement and the following terms used in this Agreement
unless the context indicates a difference meaning or intent and such definitions
shall be equally applicable to both the singular and plural forms of any of the
terms herein defined:
"Completion Date" means the date of completion of the Project, as set
forth in a completion certificate delivered pursuant to Section 5.4 hereof.
"Costs of the Project" means (a) obligations of the Issuer or the
Company incurred, or reimbursement to the Company, for labor and to contractors,
builders and materialmen in connection with the acquisition, construction and
installation of the Project; (b) the cost of contract bonds and of insurance of
all kinds that may be required or necessary during the course of acquisition of
the Project which is not paid by the contractor or contractors or otherwise
provided for; (c) all costs of architectural and engineering services, including
estimates and supervising acquisition, as well as for the performance of all
other duties required by or consequent upon the proper acquisition and
construction of the Project; (d) Issuance Costs; (e) all other costs which the
Company shall be required to pay, under the terms of any contract or contracts,
for the acquisition, construction and installation of the Project; (f) interest
allocable to the Series 1992 Bonds and property taxes through the Completion
Date; (g) all other costs relating to the Project to the extent that (i) such
costs are eligible for payment under the Act, including, but not limited to, all
such costs described in attached Exhibit B, and (ii) payment of such costs will
not cause the interest on the Series 1992 Bonds to be included in gross income
for federal income tax purposes; and (h) other costs of a nature comparable to
those described in clauses (a) through (g) above which the Company shall be
required to pay as a result of the damage, destruction, condemnation or taking
of the Project or any portion thereof.
"Indenture" means the Trust Indenture dated as of June 1, 1992 between
the Issuer and the Trustee, as the same may be amended or supplemented from time
to time as permitted thereby.
"Issuance Costs" means items of expense payable or reimbursable
directly or indirectly by the Issuer or the Company and related to the
authorization, sale and issuance of the Series 1992 Bonds and authorization and
execution of this Agreement which items of expense shall include, but not be
limited to, application fees and expenses, publication costs, printing costs,
costs of reproducing documents, filing and recording fees, Bond Counsel and
Counsel fees, costs of credit ratings, initial fees of the Trustee, Placement
Agent fees, charges for execution,
3
8
transportation and safekeeping of the Series 1992 Bonds and related documents,
and other costs, charges and fees in connection with the foregoing.
"Land" means that certain parcel of land described on Exhibit F
attached hereto.
"Loan" means the Loan made pursuant to Section 3.1 of this Agreement.
"Loan Repayments" means all amounts required to be paid by the Company
to the Trustee as the assignee of the Issuer pursuant to the Promissory Note and
Section 3.2 of this Agreement.
"Principal User" means a principal user of the Project as such term is
used in Section 144(a) of the Code.
"Project" means the acquisition, construction and equipping of a
manufacturing facility, all as more fully described in attached Exhibit D.
"Promissory Note" means the promissory note given by the Company
pursuant to this Agreement, in the form of attached Exhibit C, as the same may
be amended, modified or supplemented in accordance with the terms hereof.
"Requisition Certificate" means a certificate in the form of attached
Exhibit B delivered pursuant to Section 5.1 hereof.
"Series 1992 Bonds" means the City of Ligonier, Indiana Economic
Development Revenue Bonds (Xxxxxx Manufacturing Company Project), Series 1992
issued in the aggregate principal amount of $6,300,000.
"Trustee" means Fort Xxxxx National Bank or any successor appointed
under the Indenture.
(End of Article I)
4
9
ARTICLE II.
REPRESENTATIONS
SECTION 2.1. Representations by the Company. As an inducement to the
Issuer to issue the Series 1992 Bonds and to make the Loan to the Company, the
Company makes the following representations, warranties and covenants:
(a) The Company is a corporation duly organized and existing under the
laws of the State of Michigan and is duly authorized to transact business as a
foreign corporation in the State of Indiana.
(b) There are no actions, suits, proceedings, inquiries or
investigations pending or, to the knowledge of the Company, threatened against
or affecting the Company, except as set forth in the General Certificate of the
Company in any court or before any governmental authority or arbitration board
or tribunal which, if determined adversely to the Company, would materially and
adversely affect the transactions contemplated by this Agreement, the Pledge
Agreement, the Promissory Note, the Reimbursement Agreement or the Indenture or
which, in any way, would materially and adversely affect the enforceability or
validity of the Series 1992 Bonds, the Indenture, the Reimbursement Agreement,
the Pledge Agreement, the Promissory Note or this Agreement or the ability of
the Company to perform its obligations under this Agreement.
(c) The execution, delivery and performance of this Agreement, the
Pledge Agreement, the Promissory Note and the Reimbursement Agreement and the
compliance by the Company with all of the provisions hereof and thereof are
within its corporate powers, have been duly authorized by corporate action, and
are not in contravention of law or of the terms of the Company's Articles of
Incorporation or By-Laws, or any unwaived provision of any mortgage, deed,
instrument or undertaking to which the Company is a party or by which it or its
property is bound.
(d) This Agreement, the Pledge Agreement, the Promissory Note and the
Reimbursement Agreement are valid, binding and enforceable in accordance with
their terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting creditors' rights generally
and general principles of equity.
(e) The Company has obtained all licenses, permits and approvals
necessary and obtainable as of the Issue Date for the ownership or conduct of
its business on the Land, including the ownership and utilization of the Project
thereon and such other transactions as are contemplated by this Agreement, the
Indenture, the Pledge Agreement, the Promissory Note and the Reimbursement
Agreement.
5
10
(f) The financing, acquisition, construction and completion of the
Project is expected to result in an increase of the productivity of the Company
and the creation of ninety (90) new jobs.
(g) The Company intends to cause the Project to operate at all times
during the term of this Agreement so as to qualify as an "economic development
facility" as defined in the Act.
(h) The Project will be acquired and constructed in such manner as to
conform with all applicable zoning, planning, environmental and other
regulations of governmental authorities having jurisdiction of the Project; all
necessary utilities are or will be available to the Project; and the Company has
obtained or caused to be obtained, or will obtain or cause to be obtained, all
requisite zoning, planning, environmental and other permits necessary for the
acquisition and construction and the use contemplated for the Project.
(i) None of the proceeds of the Bonds shall be applied to any costs of
the acquisition or construction of the Project which were paid or incurred
(within the meaning of Section 103 of the Code) prior to the inducement
resolution adopted by the Issuer with respect to the Project on December 16,
1991.
(j) No bonds as described in Section 144(a)(2) of the Code have been
issued by any state, political subdivision, district, public body, agency,
authority, commission or instrumentality, the proceeds of which have been or
will be used with respect to facilities located within the unincorporated are of
Noble County, Indiana, the Principal User of which is the Company or a Related
Person as defined in Section 144(a)(3) of the Code.
(k) The Project constitutes land or property of a character subject to
the allowance for depreciation provided by the Code, and at least 95% of the net
proceeds of the Series 1992 Bonds are being used to acquire property of such
character and subject to such allowance.
(l) The amount of Issuance Costs financed from the proceeds of the sale
of the Series 1992 Bonds shall not exceed 2% of the proceeds of the Series 1992
Bonds.
(m) The Company has supplied the Issuer in its Tax Representation
Certificate the estimates of the Costs of the Project, the Completion Date and
periods of usefulness of the Project. The Company hereby warrants that such
estimates were made in good faith and are fair, reasonable and realistic based
upon information known to the Company as of the Issue Date.
(n) There are no other bonds described in Section 144(a) of the Code
which have been issued, or are contemplated to be issued, pursuant to Section
144(a) of the Code (or its predecessor provision), for the benefit of the
Company or any Related Person to the Company and which (i) were or are to be
sold within 31 days of the Issue Date; (ii) were or are to be sold pursuant to a
common plan of marketing as of the marketing plan for the Series 1992 Bonds;
(iii) were or are to be sold at substantially the same rate of interest as the
interest rate on the
6
11
Series 1992 Bonds; and (iv) are payable directly or indirectly by the Company or
from the source from which the Series 1992 Bonds are payable.
(o) The information furnished by the Company and used by the Issuer in
preparing the Form 8038, Information Return for Private Activity Issues, which
has been filed by or on behalf of the Issuer with the Internal Revenue Service
in Philadelphia, Pennsylvania pursuant to Section 149)e) of the Code, was true
and complete as of the date of filing of said Form 8038.
(p) The average maturity of the Series 1992 Bonds does not exceed 120%
of the average reasonably expected economic life of the components compromising
the Project, as determined pursuant to Section 147(b) of the Code.
(q) No more than 25% of the net proceeds of the Series 1992 Bonds will
be used to provide a facility the primary purpose of which is retail food and
beverage services, automobile sales or service, or the provisions of recreation
or entertainment. No portion of the net proceeds of the Series 1992 Bonds will
be used to provide any private or commercial golf course, country club, massage
parlor, tennis club, skating facility (including roller skating, skateboard and
ice skating), racquet sports facility (including any handball or racquetball
court), hot tub facility, suntan facility, racetrack, airplane, skybox or other
private luxury box, health club facility, facility primarily used for gambling,
store the principal business of which is the sale of alcoholic beverages for off
premises consumption or residential real property for family units.
(r) Less than 25% of the net proceeds of the Series 1992 Bonds will be
used to acquire land. No portion of the proceeds of the Series 1992 Bonds will
be used to acquire land (or an interest therein) to be used for farming
purposes.
(s) The sum of the authorized face amount of the Series 1992 Bonds
allocable to each test-period beneficiary (as defined in Section 144(a)(10)(D)
of the Code) plus the respective aggregate face amount of all tax-exempt
facility related bonds (as defined in Section 144(a)(10)(B) of the Code)
presently outstanding which are allocable to each such test-period beneficiary
does not exceed $40,000,000.
(t) The Project does not consist of a portion of a single building,
enclosed shopping mall or strip of offices, stores or warehouses using
substantial common facilities with any other portion or portions of such
property (of which the Project is a part) and where any such other portions are
or will be financed with qualified bonds the interest in which is excluded from
gross income for federal income tax purposes under Section 103(a) of the Code.
(u) The payment of principal or interest with respect to the Series
1992 Bonds is not guaranteed in whole or in part by the United States or any
agency or instrumentality thereof. The Series 1992 Bonds are not issued as part
of an issue a significant portion of the proceeds of which are to be used in
making loans the payment of principal or interest with respect to which are to
be guaranteed in whole or in part by the United States or any agency or
instrumentality thereof, or invested directly or indirectly in federally insured
deposits or
7
12
accounts. The payment of principal or interest on the Series 1992 Bonds is not
otherwise indirectly guaranteed in whole or in part by the United States or any
agency or instrumentality thereof within the meaning of Section 149(b) of the
Code.
(v) The Company will comply with the provisions of Section 148 of
the Code applicable to the Series 1992 Bonds.
(w) The Company will not make any payments, or agreements to pay, to
any party other than the United States an amount that is required to be paid to
the United States under the rebate requirements under Section 148(f) of the Code
by entering into any transaction that reduces the amount required to be paid to
the United States because such transaction results in a smaller profit or a
larger loss than would have resulted if the transaction had been at arm's length
and had the yield on the Series 1992 Bonds not been relevant to either party.
The Company will not acquire with Series 1992 Bond proceeds any certificate of
deposit, investment contract, or any other type of investment that does not
comply with the provisions of the Code.
(x) No event has occurred and no condition exists with respect to the
Company that would constitute an "Event of Default" under this Agreement or
that, with the lapse of time or the giving of notice or both, would become an
"Event of Default" under this Agreement.
(y) At least 95% of the proceeds of the Series 1992 Bonds will be used
to finance a "manufacturing facility" within the meaning of Section
144(a)(12)(C) of the Code, and no more than 25% of the net proceeds of the
Series 1992 Bonds will be used to finance facilities that are "directly related
an ancillary" thereto within the meaning of Section 144(a)(12)(C) of the Code.
For this purpose, the term "manufacturing facility" means any facility which is
used in the manufacturing or production of tangible personal property (including
the processing resulting in a change in the condition of such property).
Manufacturing facilities do not include an office unless such office is located
on the premises of the manufacturing facility and not more than a de minimus
(5%) portion of the functions to be performed at such office is not directly
related to the day-to-day operations at such facility. Manufacturing facilities
do not include storage facilities for raw materials, work in process, or
finished goods or other materials unless such storage facilities are located on
the premises of the manufacturing facility and are directly related to a
manufacturing activity conducted at such facility as opposed to a warehousing,
distributing, wholesaling, retailing or other non-manufacturing activity.
(z) We will not knowingly participate in the sale pursuant to a common
plan of marketing of the Series 1992 Bonds in connection with any other
tax-exempt bonds which will be sold at substantially the same time (i.e., within
the next 31 days) and share common or pooled security, including particularly a
letter of credit issued by NBD Bank, N.A. For purposes of this paragraph a
common plan of marketing means any situation where obligations are sold under
the same Indenture or the same Private Placement Memorandum pursuant to which
the Series 1992 Bonds were issued and offered for sale, respectively, or when
the purchase of one obligation is conditioned on the purchase of another
obligation by the same holder or group of holders.
8
13
SECTION 2.2. Representations of the Issuer. The Issuer makes the
following representations and warranties:
(a) The Issuer is a municipal corporation organized under the laws of
the State and is authorized and empowered by the provisions of the Act and the
ordinance authorizing the issuance of the Bonds to enter into the transactions
contemplated by this Agreement and to carry out its obligations hereunder, and
by proper action of its governing body had been duly authorized to execute and
deliver this Agreement. The Project constitutes an "economic development
facility" within the meaning of the Act.
(b) The Issuer has performed all duties, undertaken all acts, made all
findings and held all hearings prerequisite to the adoption of the Bond
Ordinance and the issuance of the Bonds.
(c) Heretofore the Issuer and the Company did agree that the Issuer
would finance the Costs of the Project. The Company has estimated that the
aggregate amount thereof will not be less than $6,300,000, and on that basis the
Issuer now proposes to issue its Bonds in the aggregate principal amount of
$6,300,000, which Bonds will be dated, mature and bear interest as set forth in
the Indenture, and which Bonds will be subject to redemption and purchase at the
times and the prices set forth in the Indenture, in order to finance the Costs
of the Project.
(d) The Bonds are to be issued under and secured by the Indenture,
pursuant to which certain of the Issuer's interests in this Agreement, and the
revenues and receipts to be derived by the Issuer pursuant to this Agreement,
will be pledged and assigned to the Trustee as security for payment of the
principal or purchase price of, premium, if any, and interest in this Agreement,
or the revenues and receipts derived pursuant to this Agreement, excepting
Unassigned Rights, other than to the Trustee under the Indenture to secure the
Bonds.
(e) The Issuer finds and determines that the financing of the Costs of
the Project is in the public interest and in compliance with the purposes and
provisions of the Act.
(f) Neither the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby, nor the fulfillment of or
compliance with the terms and conditions of this Agreement conflicts with or
results in a breach of the terms, conditions or provisions of any restriction,
agreement or instrument to which the Issuer is a party, or by which it or any of
its property is bound, or constitutes a default under any of the foregoing.
(g) The Issuer covenants not to purchase any of the Bonds at any time
that the Letter of Credit is available to be drawn therefor.
(h) No member of the Common Council of the Issuer has a pecuniary
interest in any employment, contract or agreement related to the transactions
contemplated by this Agreement, except as disclosed by such member in accordance
with the Act. No member of the Common
9
14
Council of the Issuer has a pecuniary interest in any property required for the
acquisition, construction and installation of the Project.
(End of Article II)
10
15
ARTICLE III.
LOAN AND REPAYMENT
SECTION 3.1. Amount and Evidence of Loan. Concurrently with the
issuance and delivery of the Series 1992 Bonds, the Issuer shall make and the
Company shall receive the Loan in the principal sum of $6,300,000. The proceeds
of the Loan shall be used to make a deposit of $6,300,000 to the Construction
Fund for payment of the Costs of the Project to be disbursed in accordance with
Section 5.1 hereof. The Loan shall be evidenced by the Promissory Note.
SECTION 3.2. Loan Repayments. On or before each date on which a payment
of principal, premium, if any, or interest is due on the Bonds, whether by
acceleration or otherwise, and until the principal of, premium, if any, and
interest on the Bonds shall have been fully paid or provided for as set forth in
Article V of the Indenture, the Company shall pay, or cause to be paid, to the
Trustee, in immediately available funds for deposit in the Bond Fund, the Loan
Repayments, including the amounts payable as principal of, premium, if any, and
interest due on the Bonds on such date, less any Eligible Funds held by the
Trustee in the Bond Fund and required to be applied to the payment of such
principal, premium, if any, and interest on such date.
Notwithstanding any provision in this Section 3.2 to the contrary, if
the Letter of Credit is outstanding and drawings may be made thereunder for the
purpose of making payments with respect to the principal of, premium, if any,
and interest due on the Bonds which are required to be made pursuant to this
Section 3.2, such payments shall be made on such dates on behalf of the Company
by the Trustee with funds drawn by the Trustee under the Letter of Credit
pursuant to clause (i) of Section 309(a) of the Indenture, and no additional
payments shall be due or paid by the Company hereunder with respect to the
payment of principal of, premium, if any, or interest on such Bonds to the
extent that funds are so drawn on the Letter of Credit and applied by the
Trustee for such payment on such dates. The Company shall have the right to
presume payment by the Bank under the Letter of Credit or any Alternate Credit
Facility which shall be in effect at said times unless the Company receives by
1:00 p.m., Detroit, Michigan time, written notice from the Trustee by telecopier
(confirmed by telephone) that such payment has not been received by the Trustee
by 12:00 noon, Detroit, Michigan time.
SECTION 3.3. Mandatory and Optional Prepayments of the Promissory Note.
The Company shall have the option to prepay the Promissory Note in whole or in
part, at any time and from time to time, in increments of principal of $100,000
during the Variable Rate Period or $5,000 during the Fixed Rate Period and
direct the redemption of the corresponding amount of Series 1992 Bonds then
outstanding on such dates and pursuant to the provisions and limitations, and
upon payment of any required premium, set forth in Section 217(a) of the
Indenture.
11
16
The Company shall be obligated to prepay the Promissory Note at such
times in order to enable the Trustee to redeem all or a portion of the Series
1992 Bonds as required in Sections 217(b), (c) and (d) of the Indenture.
In the event the Company repays or prepays Loan Repayments and other
amounts owing to the Trustee under this Agreement and the Indenture and to the
Bank under the Reimbursement Agreement in such a manner so as to permit the
Security to be released from the lien of the Indenture in accordance with
Article V of the Indenture, then the Loan shall be deemed fully repaid and this
Agreement and the Promissory Note shall be cancelled on the date on which the
Security is so released. To confirm such cancellation, the Company shall have
the right to require the Trustee to cancel the Promissory Note and execute any
further reasonable evidence of cancellation on the date the Security is so
released.
In the event of any optional prepayment of the Promissory Note, on or
before the date set for redemption of the Series 1992 Bonds to be redeemed in
connection therewith, the Company shall deposit, or cause to be deposited from a
draw on the Letter of Credit, in the Bond Fund with the Trustee immediately
available Eligible Funds which, when added to Eligible Funds on hand with the
Trustee, are sufficient to pay the principal of, premium, if any, and interest
on the Series 1992 Bonds and to pay all fees, costs, and expenses of the Issuer
and Trustee specified in Sections 3.5, 3.6, 6.4, 8.6, and 10.4 accruing through
the date set for redemption of the Series 1992 Bonds (provided that no moneys
derived from a draw on the Letter of Credit shall be used to pay such fees,
costs and expenses of the Issuer or the Trustee).
SECTION 3.4. Additional Payment Obligations of the Company. The Company
agrees to pay, or cause to be paid, to the Trustee, for deposit in the Bond
Purchase Fund, on or before each Optional Tender Date and on the Conversion Date
and on each Mandatory Purchase Date, an amount sufficient, together with any
moneys then held by the Trustee in the Bond Purchase Fund and available for such
purpose under Section 403 of the Indenture, to enable the Trustee to pay the
Purchase Price of all Bonds to be purchased on such date pursuant to Section 205
of the Indenture at the price specified therein; provided, however, that if the
Letter of Credit is outstanding and drawings may be made thereunder for such
purpose, payments with respect to the Purchase Price of the Bonds on such date
which are required to be made by the Company under this Section 3.4 shall be
made on behalf of the Company by the Trustee with funds drawn by the Trustee
under the Letter of Credit pursuant to clause (ii) of Section 309(a) of the
Indenture, and no additional payments shall be due or paid by the Company
hereunder with respect to the Purchase Price of such Bonds to the extent that
funds are so drawn under the Letter of Credit for the payment of the Purchase
Price of Bonds purchased on such date. Anything herein to the contrary
notwithstanding, if on any Optional Tender Date or Mandatory Purchase Date or on
the Conversion Date the amount theretofore paid by or on behalf of the Comapny
hereunder together with the amount theretofore drawn under the Letter of Credit
is, for any reason, insufficient to pay the Purchase Price of the Bonds being
tendered on such date as provided in the Indenture, the Company hereby agrees to
immediately pay an amount equal to such deficiency to the Trustee as its
corporate trust office in lawful money of the United States of America and such
payment shall be made at such times as are
12
17
necessary so that sufficient funds will be available at such times as are
necessary to pay the Purchase Price of the Bonds tendered under the Indenture at
the times and in the manner contemplated by the Indenture.
SECTION 3.5. Payment of Issuer Expenses. The Company shall pay, within
10 days of demand therefor, the reasonable expenses of the Issuer related to the
Project, or incurred by the Issuer in performing or enforcing the provisions of
this Agreement or the Indenture.
SECTION 3.6. Administrative Expenses. The Company shall pay, or cause
to be paid, an amount equal to (i) the reasonable fees and charges of the
Trustee for services rendered as Trustee under the Indenture and its reasonable
expenses incurred as Trustee under the Indenture, as and when the same become
due, including the reasonable fees of its counsel and (ii) the reasonable fees
and charges of the Placement Agent for acting as Placement Agent under the
Indenture, as and when the same become due, including the reasonable fees of its
Counsel.
SECTION 3.7. Letter of Credit; Alternate Credit Facility. The Company
shall cause the Original Letter of Credit to be delivered to the Trustee on or
before the Issue Date. The Original Letter of Credit shall terminate no earlier
than the earliest of (i) the payment in full by the Bank of funds authorized to
be drawn thereunder, (ii) payment in full of the Series 1992 Bonds pursuant to
the provisions of the Indenture, as certified by the Trustee to the Bank, (iii)
5 p.m., Detroit, Michigan time, on June 15, 1997 (subject to extensions) or (iv)
the fifth day following the Conversion Date.
The Company shall have the right (but is not obligated) to arrange for
the renewal, reissuance or extension of any Letter of Credit. Any renewal,
reissuance or extension shall be for a period of at least one year and shall
expire on a June 15.
At any time upon at least 45 days prior written notice to the Trustee,
the Company may, at its option, provide for delivery of an Alternate Credit
Facility which shall be effective on the date such Alternate Credit Facility is
accepted by the Trustee in accordance herewith. Any Alternate Credit Facility
shall have the same terms as the Original Letter of Credit, except that such
Alternate Credit Facility shall be for a period of at least one year and shall
expire on a June 15. On or before the date of delivery of any Alternate Credit
Facility to the Trustee, as a condition of acceptance of any Alternate Credit
Facility by the Trustee, the Company shall furnish to the Trustee (i) an opinion
of bond Counsel stating that the delivery of such Alternate Credit Facility is
authorized under and complies with this Section 3.7, and (ii) an opinion of
Counsel stating that the Alternate Credit Facility is a binding and enforceable
obligation of the issuer thereof (except as enforceability may be limited by (A)
bankruptcy, insolvency, reorganization, moratorium and other laws affecting
creditors rights generally and (B) the availability of equitable remedies,
including specific performance and injunctive relief), and that payments
thereunder will not constitute a voidable preference under the United States
Bankruptcy Code (in the event of bankruptcy, insolvency or reorganization of the
Issuer, the "Company" or any "insider" of the Company). In the case of an
Alternate Credit Facility issued by a branch or agency of a foreign commercial
bank there shall also be delivered an opinion of Counsel
13
18
satisfactory to the Trustee and licensed to practice law in the jurisdiction in
which the head office of such bank is located, to the effect that the Alternate
Credit Facility is the legal, valid and binding obligation of such bank
enforceable in accordance with its terms.
SECTION 3.8. Credit for Bonds Surrendered. The Company shall have the
right to surrender Bonds, other than Bonds pledged to the Bank pursuant to the
Pledge Agreement, acquired by it to the Trustee. Bonds so surrendered shall be
forthwith cancelled and the principal amount thereof shall be applied as credits
with respect to the Loan Repayments due and payable on the respective maturity
dates on such Bonds. Further, with respect to the amounts credited resulting
from Bonds surrendered, interest due on said amounts credited shall cease to
accrue on the date on which said amount is credited. The Trustee shall provide
the Bank with a certificate for the reduction of the amounts available to be
drawn under the Letter of Credit as a result of such payments in accordance with
the terms of the Letter of Credit.
(End of Article III)
14
19
ARTICLE IV.
SECURITY INTEREST
SECTION 4.1. Priority and Maintenance of Lien; Recording. This
Agreement shall constitute a security interest in the Trust Estate and shall be
superior to any other lien. The Company will, at its expense, take all necessary
action to maintain and preserve the security interest of this Agreement so long
as the Promissory Note is outstanding. The Company will, forthwith after the
execution and delivery of this Agreement and thereafter from time to time, cause
this Agreement and any financing statements in respect thereof to be filed,
registered and recorded in such manner and in such places as may be required by
law in order to publish notice of and fully to protect the security interest
hereof upon the Trust Estate; and from time to time will perform or cause to be
performed any other act as provided by law and will execute or cause to be
executed any and all continuation statements and further instruments that may be
requested by the Issuer or Trustee for such publication and protection. The
Company will pay or cause to be paid all filing, registration and recording fees
incident to such filing, registration and recording, and all expenses incident
to the preparation, execution and acknowledgement of such instruments of further
assurance, and all federal or state fees and other similar fees, duties,
imposts, assessments and charges arising out of or in connection with the
execution and delivery of this Agreement and such instruments of further
assurance.
SECTION 4.2. Further Assurances; After-acquired Property. The Company
will do, execute, acknowledge and deliver, or cause to be done, executed,
acknowledged and delivered, all such further acts, assignments, transfers and
assurances as the Issuer or Trustee reasonably may require for the better
assuring, assigning and confirming unto the Issuer and the Trustee all and
singular the Trust Estate as now or hereafter constituted.
SECTION 4.3. Company Duties Under Indenture. The Company agrees to
perform all matters provided by the Indenture to be performed by the Company and
to comply with all provisions of the Indenture applicable to the Company.
(End of Article IV)
15
20
ARTICLE V.
CONSTRUCTION OF THE PROJECT
SECTION 5.1. Disbursements from the Construction Fund. Moneys in the
Construction Fund shall be used for payment of the Costs of the Project and for
the other purposes set forth in this Agreement, but for no other purposes. The
Trustee shall not be obligated to make any disbursement to the Company out of
the Construction Fund upon the occurrence and continuation of an Event of
Default under Section 10.1 hereof.
Each of the payments to be made for Costs of the Project as herein
provided shall be made only upon delivery to the Trustee of a Requisition
Certificate signed by an authorized officer of the Company. The Company shall
deliver or cause to be delivered to the Trustee, (i) an itemization of Costs of
the Project in sufficient detail to evidence the incurring of the costs thereof,
and (ii) such other documentation as the Trustee may reasonably request. All
requests for payment under this Section 5.1 will be honored within 5 business
days of meeting the requirements of this Section, to the extent monies are
available therefor.
SECTION 5.2. Obligation of the Company to Complete the Project and to
Pay Costs in Event Construction Fund Insufficient. The Company hereby agrees to
substantially complete the Project on or before June 12, 1995 or such other date
acceptable to the Bank. If requested, the Company shall make available to the
Issuer, the Bank and the Trustee such information concerning the Project as any
of them may reasonably request. The Company may revise the Project, provided,
however, that the Project shall not be materially altered in scope, character,
value or operation without the prior witness consent of the Issuer, the Trustee
and the Bank, and provided, further, that the expenditure of moneys for the
Project as modified is permitted by the Act and will not impair the exclusion of
interest on the Bonds from gross income for federal income tax purposes.
In the event the moneys in the Construction Fund are insufficient to
complete the Project and to pay all costs, fees and expenses in connection
therewith, the Company nevertheless agrees to substantially complete the Project
on or before the date and in the manner specified above, and promptly to pay all
such costs, fees and expenses. The Issuer does not make any warranty, either
express or implied, that the moneys which will be paid into the Construction
Fund will be sufficient to pay the entire amount of such costs, fees and
expenses of the Project. The Company shall not be entitled to any reimbursement
from the Issuer or the Trustee, on account of its payment of any such excess
costs, fees and expenses, nor shall it be entitled to any diminution in or
postponement of any payment required hereunder or under the Promissory Note.
SECTION 5.3. Investment of Construction Fund, Bond Fund and Bond
Purchase Fund Moneys. Any moneys held in the Construction Fund, Bond Fund or
Bond Purchase Fund shall, pending disbursement and upon written request of the
Company or upon oral request of the Company later confirmed in writing, be
invested only in Permitted Investments in accordance
16
21
with the provisions of Section 406 of the Indenture, all at such maturities,
rates of interest and other specifications as the Company may indicate in its
request to the Trustee. The investments shall mature not later than the
respective dates estimated by the Company when the moneys in such Funds shall be
needed for the purposes provided in this Agreement and the Indenture, but should
the cash balance in a Fund be insufficient for such purpose, the Trustee is
authorized to sell the necessary portion of such investments to meet that
purpose. Recognizing that such investments shall be made at the written
direction of the Company, the Issuer agrees to cooperate with the Company and
the Company covenants that it will restrict the use of the proceeds of the bonds
(and any other funds or moneys which may be deemed to be proceeds of the Bonds
pursuant to Section 148(a) of the Code), in such manner and to such extent, if
any, as may be necessary, after taking into account reasonable expectations at
the time the Bonds are issued, so that the Bonds will not constitute "arbitrage
bonds" under Section 148(a) of the Code.
SECTION 5.4. Certificate as to Completion. The Completion Date of the
Project and the payment of Costs of the Project shall be evidenced to the
Trustee, the Bank and the Issuer by a completion certificate signed by the
Company substantially in the form of attached Exhibit A. All Surplus Bond
Proceeds shall be transferred to the Bond Fund to be applied by the Trustee in
the manner provided in Section 11.1 hereof.
(End of Article V)
17
22
ARTICLE VI.
USE OF PROJECT, MAINTENANCE, TAXES AND INSURANCE
SECTION 6.1. Use, Maintenance and Modifications of Project by Company.
The Company intends to use, or cause to be used, the Project during the term of
this Agreement principally for manufacturing purposes. The Company does not know
of any reason why the Project will not be so used. Notwithstanding the
foregoing, the Company shall have the right to use the Project during the term
of this Agreement for any lawful purpose that will not affect the validity of
the Bonds or impair the exclusion of interest on the Bonds from gross income for
federal income tax purposes. The failure of the Company to use, or cause to be
used, the Project for its intended purposes shall not in any way xxxxx or reduce
the obligation of the Company to repay the Loan under the provisions of this
Agreement, and shall not be deemed a default under this Agreement in any respect
as long as such alternative use does not impair the exclusion of interest on the
Bonds from gross income for federal income tax purposes.
The Company may modify the Project from time to time as the Company, in
its discretion, may deem to be desirable, provided, however, that such
additions, modifications and improvements do not impair the exclusion of
interest on the Bonds from gross income for federal income tax purposes and do
not contravene the provisions of the Act. The Trustee, the Issuer or the Bank
may request opinions of Bond Counsel, satisfactory to the Issuer, the Trustee
and the Bank, as to the satisfaction of the requirements set forth in this
paragraph.
SECTION 6.2. Taxes, Other Governmental Charges and Utility Charges. The
Company shall pay, promptly as the same become due and payable, every lawful
cost, expense and obligatio for every kind and nature, foreseen or unforeseen,
for the payment of which the Company is or shall become liable by reason of its
estate or interest in the Project or any portion thereof, by reason of any right
or interest of the Company in or under this Agreement, or by reason of or in any
manner connected with or arising out of the possession, operation, maintenance,
alteration, repair, rebuilding, use or occupancy of the Project or any portion
thereof, including, without limitation, all taxes, assessments, whether general
or special, and governmental charges of any kind whatsoever that may at any time
be lawfully assessed or levied against or with respect to the Project or any
machinery, equipment or other property installed or brought by the Company
therein or thereon (including, without limiting the generality of the foregoing,
any taxes levied upon or with respect to the receipts, income or profits of the
Issuer from the Project and all utility and other charges incurred in the
operation, maintenance, use, occupancy and upkeep of the Project); provided,
that with respect to special assessments or other governmental charges that may
lawfully be paid in installments over a period of years, the Company shall be
obligated to pay only such installments as the become due.
The Company may, at its expense and in its own name, in good faith
contest any such taxes, assessments and other charges.
18
23
The Company shall furnish to the Issuer promptly, upon request, proof
of the payment of any such tax, assessment or other governmental or similar
charge, or any other charge which is payable by the Company as set forth above.
SECTION 6.3. Insurance. The Company shall from the date hereof,
continuously insure the Project or cause the Project to be insured against such
risks as are customarily insured against by businesses of like size and
character.
All insurance policies required under this Section 6.3 shall be
effected with insurance companies qualified under the laws of the State to
assume the risks undertaken. The required insurance may be in the form of
blanket insurance policies and may be provided by so-called umbrella coverage.
(End of Article VI)
19
24
ARTICLE VII.
DAMAGE, DESTRUCTION AND CONDEMNATION
In the event (i) the Project is destroyed or sustains damage or (ii)
title to or temporary use of all or substantially all of the Project is taken in
condemnation or by the exercise of the power of eminent domain by any
governmental body or by any Person acting under governmental authority, the
Company shall promptly give written notice thereof to the Issuer, the Bank and
the Trustee. If the cost of restoration or repair equals or does not exceed
$25,000 the Company will restore or repair the Project as hereinafter provided,
to the extent that insurance proceeds are made available therefor. If the cost
of restoration or repair exceeds $25,000, or if title to or use of all or
substantially all of the Project is taken in condemnation or by eminent domain,
as soon as practicable, but not later than 60 days after such damage,
destruction or taking, the Company shall elect in writing to the Issuer, the
Bank and the Trustee whether to restore the Project as hereinafter provided or
to prepay the Loan and cause the Series 1992 Bonds to be paid or redeemed to the
extent of the available insurance or condemnation proceeds.
(End of Article VII)
20
25
ARTICLE VIII.
SPECIAL COVENANTS
SECTION 8.1. Unconditional Obligation. The Company hereby acknowledges
and agrees that the Company's obligation to make Loan Repayments and the other
payments required hereunder and to perform and observe the other agreements
herein contained shall be absolute and unconditional and shall not be subject to
any abatement, reduction, set-off, defense, counterclaim or recoupment for any
reason whatsoever. Except as otherwise expressly provided herein, this Agreement
shall not terminate, nor shall the obligations of the Company be affected, by
reasons of any defect in or damage to or loss or destruction of all or any part
of the Project, the failure of the Issuer to perform or observe any agreement,
liability or obligation hereunder or the lawful prohibition of the Company's or
any other Person's use of the Project, the interference with such use by any
Person, the invalidity or unenforceability or lack of due authorization or other
infirmity of this Agreement or any part hereof, lack of right, power or
authority of the Issuer to enter into this Agreement, or for any other cause
whether similar or dissimilar to the foregoing, any present or future tax or
other law to the contrary notwithstanding, it being the intention of the parties
hereto that Loss Repayments and other amounts payable by the Company hereunder
shall continue to be payable in all events unless the obligation to pay the same
shall be terminated pursuant to the express provisions of this Agreement.
In the event the Company shall fail to make or cause to be made any of
the payments required to be made under this Agreement, the unpaid amount shall
continue to be an obligation of the Company until such amount shall be fully
paid, and the Company agrees to pay the same with interest thereon from the date
when due until paid at the greater of the rate borne by the Series 1992 Bonds or
the per annum rate of interest equal to the rate of interest announced from time
to time by the Trustee as its "reference rate" plus 3%.
SECTION 8.2. Right of Access to the Project. Subject to the reasonable
security, safety and confidentiality requirements of the Company, the Company
agrees that the Issuer, the Bank and the Trustee, and their respective duly
authorized agents, shall have the right at all reasonable times upon reasonable
prior notice to enter upon the Project to examine and inspect the same, and
shall have the right at all reasonable times to inspect all books and records of
the Company relating to the Project to confirm compliance with this Agreement
and make copies thereof.
SECTION 8.3. Maintenance of Corporation Existence and Qualification.
The Company agrees that throughout the term of this Agreement it shall maintain
its corporate existence and shall not merge or consolidate with any other
corporation and shall not transfer or convey all or substantially all of its
property, assets and licenses, except as otherwise provided in the Reimbursement
Agreement.
21
26
The Company warrants (i) that it is and throughout the term hereof it
will continue to be qualified to do business in the State, and (ii) that if it
elects to consolidate with, merge into or transfer all or substantially all of
its assets to another corporation in accordance with this Section, and such
other corporation is not organized under the laws of the State, the Company, as
a condition of such consolidation, merger or transfer of assets, shall cause
such other corporation to qualify to do business as a foreign corporation in the
State and to remain so qualified continuously during the term hereof.
SECTION 8.4. Granting Easements. The Company may at any time or times
grant easements, licenses, rights-of-way and other rights or privileges in the
nature of easements with respect to the Land, or release existing easements,
licenses, rights-of-way and other rights or privileges with or without
consideration.
SECTION 8.5. Covenant as to Non-Impairment of Tax-Exempt Status. The
Company covenants that, notwithstanding any provision of this Agreement or the
rights of the Company hereunder, it will not knowingly take, or permit to be
taken on its behalf, any action that would impair the exclusion of interest on
the Bonds from gross income for federal income tax purposes and that it will
take such reasonable action as may be necessary to continue such exclusion,
including, without limitation, the preparation and filing of any statements
required to be filed by it in order to maintain such exclusion.
The Company will not cause or permit any proceeds of the Bonds to be
invested in a manner contrary to the provisions of Section 148 of the Code and
will assure compliance with such requirements on behalf of the Issuer. At least
every year, the Company will furnish to the Trustee a report showing the amounts
that will be required to be paid to the United States of America pursuant to the
provisions of Section 148(f) of the Code as of the end of such year. The Company
shall calculate and timely pay to the United States of America, for the account
of the Issuer, all amounts required to be so paid in accordance with said
Section 148(f) and shall maintain, on behalf of the Issuer, all records required
to be maintained pursuant to said Section 148(f). At least once every five
years, and not later than sixty days after the payment in full of each series of
Bonds, the Company will furnish to the Issuer and the Trustee a certificate
showing compliance with the applicable provisions of said Section 148(f), which
certificate shall be accompanied by an opinion of Counsel or certificate of
accountants supporting the matters set forth in such certificate.
In addition to the foregoing covenants, the Company further covenants
that (i) it will requisition, apply and spend the moneys in the Construction
Fund in a manner so that at least 95% of the total amount requisitioned from the
Construction Fund will be applied to finance costs (incurred after December 6,
1991) for the acquisition, or improvement of land and other property which is of
a character subject to an allowance for depreciation under Section 167 of the
Code; (ii) it will not permit moneys in the Bond Fund, Bond Purchase Fund or
Construction Fund to be invested in such a manner as to cause the Bonds to be
"arbitrage bonds" under Section 148(a) of the Code; (iii) it will promptly
notify the Trustee if, at any time, the Company proposes to take any action, or
any action is to be taken by or on behalf of any Principal User
22
27
of the Project or any Related Person, the effect of which could be to cause
interest on the Bonds to become includable in the gross income of owners thereof
for federal income tax purposes by reason of the $10,000,000 capital expenditure
limitation imposed by Section 144(a)(4) of the Code being exceeded or the
$40,000,000 limitation imposed by Section 144(a)(10) of the Code being exceeded;
(iv) it will not requisition from the Construction Fund more than $126,000 to
pay Issuance Costs; and (v) no portion of the net proceeds of the Series 1992
Bonds will be used for the acquisition of any property (or an interest therein)
unless the first use of such property is pursuant to such acquisition.
The Company acknowledges that a failure to abide by the foregoing
covenants may result in a Determination of Taxability. In the event of a
Determination of Taxability for any reason, the sole and exclusive remedy of the
holders of the Bonds and the Trustee on their behalf shall be the early
redemption of the Bonds as provided therein under the caption "Mandatory
Redemption."
SECTION 8.6. Indemnity, Expenses.
(a) Except as provided in subsection (b), the Ligonier Economic
Development Commission (the "Commission") and the Issuer and their respective
members, officers, agents and employees (hereinafter the "Indemnified Persons")
shall not be liable to the Company for any reason. The Company shall indemnify
and hold the Issuer and the Indemnified Persons harmless from any loss, expense
(including reasonable counsel fees), or liability of any nature due to any and
all suits, actions, legal or administrative proceedings, or claims arising or
resulting from, or in any way connected with: (i) the financing, installation,
construction, operation, use, or maintenance of the Project, (ii) any act,
failure to act, or misrepresentation by any person in connection with the
issuance, sale, delivery or remarketing of the Bonds, or (iii) any act, failure
to act, or misrepresentation by the Issuer in connection with this Agreement or
any other document involving the Issuer in this matter. If any suit, action or
proceeding is brought against the Issuer or any Indemnified Person, that suit,
action or proceeding shall be defended by Counsel to the Company, which Counsel
shall be reasonably acceptable to the Issuer. If the Company shall not have
employed counsel or if an Indemnified Person shall have reasonably concluded
that there may be defenses available to it which are different from or
additional to those available to the Company (in which case the Company shall
not have the right to direct the defense of such action on behalf of such
Indemnified Person), legal and other expenses thereafter reasonably incurred by
the Indemnified Person shall be borne by the Company. The Company shall not be
liable for any settlement of any proceeding made without its consent (which
consent shall not be unreasonably withheld).
(b) (i) The Company shall not be obligated to indemnify the Issuer or
any Indemnified Person under subsection (a), if a court with competent
jurisdiction finds the liability in question was caused by the willful
misconduct or gross negligence of the Issuer or the involved Indemnified
Person(s), unless the Court determines that, despite the adjudication of
liability but in view of all circumstances of the case, the Issuer or the
Indemnified Person(s) is (are) fairly and reasonably entitled to indemnity for
the expenses which the Court considers proper.
23
28
(ii) Notwithstanding anything to the contrary contained herein or in
the Indenture, the Bonds, or in any other instrument or document executed by or
on behalf of the Issuer in connection with the issuance of the Bonds, no
stipulation, covenant, agreement or obligation contained herein or therein shall
be deemed or construed to be a stipulation, covenant, agreement or obligation or
any present or future member, commissioner, director, trustee, officer, employee
or agent of the Issuer or its Economic Development Commission, or of any
incorporator, member, commissioner, director, trustee, officer, employee or
agent of any successor to the Issuer or its Economic Development Commission, in
any such person's individual capacity, and no such person, in his individual
capacity, shall be liable personally for any breach or non-observance of or for
any failure to perform, fulfill or comply with any such stipulations, covenants,
agreements or the principal of, premium, if any, or interest on any of the Bonds
or for any claim based thereon or on any such stipulation, covenant, agreement
or obligation, against any such person, in his individual capacity, whether
directly or through the Issuer or any successor to the Issuer, 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 person in his
individual capacity, is hereby expressly waived and released.
(iii) The Company shall also indemnify the Issuer for all reasonable
costs and expenses, including reasonable Counsel fees, incurred in: (i)
successfully enforcing any obligation of the Company under this Agreement or any
related agreement, (ii) taking any action requested by the Company, (iii) taking
any action required by this Agreement or any related agreement, or (iv) taking
any action considered necessary by the Issuer and which is authorized by this
Agreement or any related agreement.
(iv) The Company shall indemnify and save the Trustee harmless against
and from all loss, liability or damages and reasonable attorneys' fees incurred
by it in the exercise and performance of any of its powers and duties hereunder
or under the Indenture except to the extent that such loss, liability or damage,
including reasonable attorney fees, is incurred by reason of its negligence or
willful misconduct.
(v) The obligations of the Company under this Section 8.6 with respect
to events arising during the term of the Company's obligation under this
Agreement shall survive any assignment or termination of this Agreement.
(End of Article VIII)
24
29
ARTICLE IX.
ASSIGNMENT, LEASING, EQUIPMENT
SECTION 9.1. Transfer, Assignment and Leasing. The Company may lease
any portion of the project constituting less than or equal to 10% of the Project
to any other tenant without the consent of the Bank and may lease any portion of
the Project exceeding 10% of the Project to any other tenant with the consent of
the Bank (if a Letter of Credit or Alternate Credit Facility is in effect)
provided that the Company delivers to the Bank (if a Letter of Credit or
Alternate Credit Facility is in effect), the Issuer and the Trustee in
connection with any such leasing an opinion of Bond Counsel that subsequent to
the execution of the lease, interest on the Bonds will remain wholly excludeable
from gross income of the Bondholders for federal income tax purposes. No leasing
shall relieve the Company from primary liability for any of its tax purposes. No
leasing shall relieve the Company from primary liability for any of its
obligations hereunder, and in the event of any such leasing the Company shall
continue to remain primarily liable for the payment of Loan Repayments and for
performance and observance of the other agreements herein on its part to be
performed and observed.
The Company may assign this Agreement and convey, whether by operation
of law or otherwise, the Project with the prior written consent of the Bank (if
a Letter of Credit or Alternate Credit Facility is in effect), the Bondholders
(if no Letter of Credit or Alternate Credit Facility is in effect) and the
Issuer. Any assignee shall assume in writing the obligations of the Company
hereunder.
The Company shall furnish to the Issuer, the Bank (if a Letter of
Credit or Alternate Credit Facility is in effect) and the Trustee a true and
complete copy of each assignment or lease, as the case may be, together with, if
the lease involves 10% or more of the Project, an opinion of Bond Counsel that
such assignment or leasing will not adversely affect the exclusion of interest
on the Bonds from gross income for federal income tax purposes.
SECTION 9.2. Substitution and Removal of Machinery and Equipment.
Except as provided in this Section machinery and equipment comprising part of
the Project shall remain on the Land. The Company shall have the privilege of
removing any machinery or equipment comprising a part of the Project provided
that in the opinion of Bond Counsel, such removal shall not impair the exclusion
of interest on the Bonds from gross income for federal income tax purposes. The
Company may, at its option, replace such removed machinery and equipment with
like or different machinery or equipment. Any such substituted machinery and
equipment shall be identified in writing by the Company to the Issuer, the
Trustee and the Bank and shall become a part of the Project and be included
under the terms of this Agreement. The Company may, with the consent of the
Bank, sell any machinery and equipment comprising a portion of the Project
without substitution therefore so long as the removal of such machinery and
equipment from the Project will not, in the opinion of Bond Counsel, impair the
exclusion of interest on the Bonds from gross income for federal income tax
purposes.
25
30
SECTION 9.3. Installation of Company's Own Machinery and Equipment. In
addition to the Project, the Company may from time to time, in its sole
discretion and at its own expense, install additional movable personal property,
machinery, equipment or furniture on or in the Project. The Company agrees to
pay as due the purchase price of, and all costs and expenses with respect to,
the acquisition and installation of any such property installed pursuant to this
Section. No such property shall constitute a part of the Project under this
Agreement.
(End of Article IX)
26
31
ARTICLE X.
EVENTS OF DEFAULT AND REMEDIES
SECTION 10.1. Events of Default. The following shall be events of
default under this Agreement and the terms "Event of Default" or "Default" shall
mean, whenever they are used in this Agreement, any one or more of the following
events:
(a) Failure by the Company to pay the Loan Repayments in the amounts
and at the times provided in this Agreement or the Promissory Note; provided,
however, that no Event of Default described in this subparagraph (a) shall be
deemed to have occurred solely by reason of such failure to make such payments
if and to the extent that payments have nonetheless been made by the Bank to the
Trustee pursuant to the Letter of Credit for deposit in the Bond Fund at such
times and in such manner so as to prevent an event of default described under
Section 601(a) or (b) of the Indenture;
(b) Failure by the Company to make payments in the amounts and at the
times provided in Section 3.4 of this Agreement; provided, however that no Event
of Default described in this paragraph (b) shall be deemed to have occurred
solely by reason of such failure to make such payments if and to the extent that
payments have nonetheless been made by the Bank to the Trustee pursuant to the
Letter of Credit for deposit in the Bond Purchase fund at such times and in such
manner so as to prevent an event of default described under Section 601(c) of
the Indenture;
(c) Failure by the Company to observe and perform any other covenant,
condition or agreement on its part to be observed or performed herein or in the
Promissory Note for a period of thirty (30) days after written notice,
specifying such failure and requesting that it be remedied, shall have been
given to the Company by the Trustee; provided, however, that if the Company
shall be unable to observe or perform any such covenant, condition, undertaking
or agreement which, if begun and prosecuted with due diligence, can be completed
but not within a period of thirty (30) days, then such period shall be increased
to such extent as shall be necessary to enable the Company to observe or perform
such covenant, condition, undertaking or agreement through the exercise of due
diligence;
(d) Any representation or warranty made by the Company in any document
delivered by the Company to the Trustee or the Bank or the Issuer in connection
with the sale and delivery of the Series 1992 Bonds which proves to be untrue
when made in any material respect (subject to cure rights contained in such
documents);
(e) Occurrence of an Event of Default under the Indenture (provided
that remedying such Event of Default under the Indenture shall, ipso facto,
remedy such hereunder); or
(f) The Company (i) shall generally not pay its debts as they become
due, (ii) shall admit in writing its inability to pay its debts generally, (iii)
shall make a general assignment for
27
32
the benefit of creditors, (iv) shall institute any proceeding or voluntary case
(A) seeking to adjudicate it a bankrupt or insolvent or (B) seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts under any law relating to bankruptcy, insolvency
or reorganization or relief or protection or debtors or (C) seeking the entry of
an order for relief or the appointment of a receiver, trustee, custodian or
other similar official for it or for any substantial part of its property, (v)
shall take any action to authorize any of the actions described above in this
subsection (f), or (vi) shall have instituted against it any proceeding (A)
seeking to adjudicate it a bankrupt or insolvent or (B) seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts under any law relating to bankruptcy, insolvency
or reorganization or relief or protection of debtors or (C) seeking the entry of
an order for relief or the appointment of a receiver, trustee, custodian or
other similar official for it or for any substantial part of its property, and,
if such proceeding is being contested by the Company in good faith, such
proceeding shall remain undismissed or unstayed for a period of 120 days.
SECTION 10.2. Remedies on Default. Whenever an Event of Default
referred to in Section 10.1 hereof shall have occurred and be continuing, and if
acceleration of the principal amount of the Series 1992 Bonds has been declared
pursuant to Section 602 of the Indenture;
(a) The Trustee shall declare all Loan Repayments to be immediately due
and payable, whereupon the same shall become immediately due and payable and the
Trustee shall thereupon draw up the Letter of Credit in accordance with its
terms and the terms of the Indenture;
(b) Subject to the reasonable security and safety requirements of the
Company, the Trustee may have access to and inspect, examine, and make copies of
the books and records of the Company insofar as they relate to the Project or
the Event of Default and the remedying thereof; and
(c) To the extent of any insufficiency after drawing under the Letter
of Credit, the Trustee may pursue all remedies now or hereafter existing at law
or in equity to collect all amounts then due and thereafter to become due under
this Agreement, the Promissory Note or to enforce the performance of any other
obligation or agreement of the Company under such documents.
Any amounts collected pursuant to action taken under this Section shall
be applied in accordance with Section 607 of the Indenture.
Notwithstanding any other provision of this Agreement (except Section
13.2 hereof) or the Indenture, the Issuer shall be entitled to cause the Company
to perform the Company's obligations under Sections 3.5, 8.6 and 10.4 hereof for
the benefit of the Issuer.
SECTION 10.3. No Remedy Exclusive. No remedy conferred upon or reserved
to the Issuer or the Trustee by this Agreement is intended to be exclusive of
any other available
28
33
remedy or remedies, but each and every such remedy shall be cumulative and shall
be in addition to every other remedy given under this Agreement, or the
Indenture, or now or hereafter existing at law or in equity. No delay or
omission to exercise any right or power accruing upon any Default shall impair
any such right or power or shall be construed to be a waiver thereof, but any
such right and power may be exercised from time to time and as often as may be
deemed expedient. In order to entitle the Issuer or the Trustee to exercise any
remedy reserved to it in this Article, it shall not be necessary to give any
notice, other than such notice as may be herein expressly required.
Notwithstanding any other provision of this Agreement (except Section
13.2 hereof) or the Indenture, the Issuer or the Trustee shall not be entitled
to exercise any remedy reserved to it in this Article X without the prior
written consent of the Bank, except that the Issuer may after notice to, but
without the prior written consent of, the Bank institute an action against the
Company to recover any fees or expenses to which the Issuer is entitled under
this Agreement.
SECTION 10.4. Agreement to Pay Attorneys' Fees and Expenses. In the
event that the Issuer, the Bank or the Trustee employs attorneys or incurs other
expenses for the enforcement of performance or observance of any obligation or
agreement on the part of the Company contained in the Promissory Note, the
Placement Agreement or in this Agreement, the Company agrees that it will on
demand therefor promptly reimburse the reasonable fees of such attorneys and
such other expenses so incurred.
SECTION 10.5. No Additional Waiver Implied by One Waiver. In the event
any term, condition or covenant contained in this Agreement should be breached
by either party and thereafter waived by the other party, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive any
other breach hereunder. Because of the assignment of the Issuer's rights and
interest in this Agreement to the Trustee under the Indenture, the Issuer shall
have no power to waive or release the Company from any Event of Default or the
performance or observance of any obligation or condition of the Company under
this Agreement without prior written consent of the Trustee and the Bank, but
the Issuer shall so waive or release the Company if requested by the Trustee and
the Bank, provided the Issuer receives an opinion of its Counsel that such
action will not impose any pecuniary obligation or liability or adverse
consequence upon the Issuer and the Issuer shall have been provided such
indemnification from the Company or the Trustee or the Bank, as the Issuer shall
deem necessary.
(End of Article X)
29
34
ARTICLE XI.
PAYMENT OF SURPLUS BOND PROCEEDS FROM THE BOND FUND
SECTION 11.1. Surplus Bond Proceeds. All Surplus Bond Proceeds
transferred to the Bond Fund pursuant to the provisions of Section 5.4, Article
VIII and Section 9.2 hereof shall be applied by the Trustee at the direction of
the Company after the date on which such moneys first become Eligible Funds in
the Bond Fund (i) to the purchase of Bonds on the open market for cancellation,
or (ii) to the redemption of series 1992 Bonds on the first date on which the
Series 1992 Bonds may be called for optional redemption without a premium or
penalty as set forth in Section 217(a) of the Indenture. Such excess shall be
invested at a yield which will not exceed the yield on the Bonds or, in the
opinion of Bond Counsel, will not impair the exclusion of interest on the Series
1992 Bonds from gross income for federal income tax purposes.
(End of Article XI)
30
35
ARTICLE XII.
THE BONDS
SECTION 12.1. Issuance of the Series 1992 Bonds. The obligations of the
Issuer and the Company hereunder are expressly conditioned upon the execution of
the Placement Agreement, satisfaction or waiver of its terms and conditions, and
payment for the Series 1992 Bonds pursuant thereto.
SECTION 12.2. Additional Bonds. At the request of the Company and with
the prior written consent of the Bank, the Issuer may, but shall not be required
to, authorize the issuance of Additional Bonds in accordance with Section 220 of
the Indenture. The terms of any Additional Bonds shall be approved by the
Company and the Bank in writing. Additional Bonds may be issued only to finance
any one or more of the following: (i) the cost of completing the Project; (ii)
the costs of making improvements to the Project; (iii) the refunding of all or
any part of the Bonds; and (iv) the costs of issuance relating to the Additional
Bonds and other costs reasonably related to the financing as shall be agreed
upon by the Company and the Issuer. Any improvements to the Project acquired
with the proceeds of the Additional Bonds shall become a part of the Project and
shall be included under this Agreement. Refusal for any reason by the Issuer to
Issue Additional Bonds shall not release the Company from any provisions of this
Agreement. The foregoing shall not prohibit the issuance of debt obligations by
or for the benefit of the Company under the Indenture.
SECTION 12.3. Compliance with Indenture. The Issuer agrees to comply
with the covenants, requirements and provisions of the Indenture and perform all
of its obligations thereunder.
SECTION 12.4. Consent to Issuer's Pledge. The Company hereby
acknowledges and consents to the assignment and pledge by the Issuer to the
Trustee, for the benefit of the Bondholders, and the Bank, of (i) the Promissory
Note; (ii) the moneys deposited to the various funds and accounts hereunder and
under the Indenture (including investments); and (iii) all of the Issuer's
rights and powers under this Agreement, including the right to receive Loan
Repayments (but excluding certain rights of the Issuer as specified in Section
301(iv) of the Indenture) and the right and power to enforce, either jointly
with the Issuer or separately, the performance of the obligations of the Company
under this Agreement. The Company further acknowledges and consents to the right
of the Trustee and the Bank, as the case may be, to enforce all rights of the
Issuer and Bondholders assigned under the Indenture.
SECTION 12.5. Rights of Trustee Hereunder. The parties hereto recognize
and agree that the terms of this Agreement and the enforcement thereof are
essential to the security of the Trustee (for the benefit of the Bondholders)
and the Bank and are entered into for the benefit of the Trustee (on behalf of
the Bondholders) and the Bank. The Trustee (and any assignee or subrogee to the
Trustee) and the Bank shall accordingly have contractual rights and duties in
this agreement and be entitled to require the enforcement of the terms hereof.
31
36
Except for the rights of the Company set forth in Section 13.1 hereof,
the Company and the Issuer each acknowledge that neither the Company nor the
Issuer has any interest in the Bond Fund or the Bond Purchase Fund and any
moneys deposited therein and that the Bond Fund and the Bond Purchase Fund and
any moneys deposited therein shall be in the custody of and held by the Trustee
in trust for the benefit of the Bondholders and the Bank as provided in the
Indenture.
SECTION 12.6. Amendments to Indenture and this Agreement. The Issuer
shall not amend nor consent to any amendment to the Indenture or this Agreement
except as specified in Article VIII of the Indenture, which Article VIII is
incorporated herein by this reference as if it were fully set forth herein. The
Company hereby agrees to be bound by the provisions of Article VIII of the
Indenture.
(End of Article XII)
32
37
ARTICLE XIII.
MISCELLANEOUS
SECTION 13.1. Amounts Remaining in Funds. Any amounts remaining in the
Construction Fund, the Bond Purchase Fund and the Bond Fund upon expiration or
sooner cancellation or termination of this Agreement, after the Loan and the
Bonds shall be deemed to have been paid and discharged under the provisions of
the Indenture and the fees, charges and expenses of the Trustee and all other
amounts required to be paid under the Indenture, the Reimbursement Agreement and
this Agreement shall have been paid, shall be paid to the Company as an
overpayment of the Loan.
SECTION 13.2. Rights of the Bank. All rights of the Bank under this
Agreement to consent to certain extensions, remedies, waivers, actions and
amendments hereunder shall cease, terminate and become null and void (i) for so
long as the Bank wrongfully dishonors any draft presented in strict conformity
with the Letter of Credit and until it has honored a subsequent draft, if any,
thereunder or (ii) if the Letter of Credit is no longer in effect and any and
all of the Company's obligations to the Bank pursuant to the Reimbursement
Agreement have been paid.
SECTION 13.3. Notices. All notices, certificates, requests or other
communications hereunder shall be sufficiently given and shall be deemed given
when mailed by registered or certified mail, postage prepaid, addressed as
follows:
If to the Issuer: City of Ligonier, Indiana
City Hall
000 Xxxx 0xx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000-0000
Attention: City Attorney
Telephone: (000) 000-0000
FAX: (000) 000-0000
If to the Company: Xxxxxx Manufacturing Company
c/o Walbro Automotion Corporation
1227 Centre Road
P.O. Box 215257
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
33
38
If to the Trustee: Fort Xxxxx National Bank
(Correspondence sent X.X. Xxx 000
via regular mail) Xxxx Xxxxx, Xxxxxxx 00000
Attention: Corporate Trust Department
Telephone: (000) 000-0000
FAX: (000) 000-0000
If to the Trustee: Fort Xxxxx National Bank
(Correspondence sent 0000 Xxxxxxxx Xxxx
via Certified, Registered, Xxxx Xxxxx, Xxxxxxx 00000
Overnight or Couriered Delivery) Attention: Corporate Trust Department
Telephone: (000) 000-0000
FAX: (000) 000-0000
If to the Bank: NBD Bank, N.A.
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Manager,
Commercial Loan Department
Telephone: (000) 000-0000
FAX: (000) 000-0000
If to the Placement Agent: First Commerce Capital, a division of
Xxxxxx, White & Yardley, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
The Company, the Issuer, the Bank, the Trustee and the Placement Agent
may designate, by notice given hereunder, any further or different addresses to
which subsequent notices, certificates, requests or other communications shall
be sent, but no notice directed to any one such entity shall thereby be required
to be sent to more than two addresses.
SECTION 13.4. Bondholders' Action. Whenever any consent, approvals,
waivers or other actions are required of the Bondholders hereunder, under the
Indenture, the Promissory Note or any other instrument or document delivered
with respect to the Bonds, such consent shall only be given in compliance with
Section 806 of the Indenture.
SECTION 13.5. Binding Effect. This Agreement shall inure to the benefit
of and shall be binding upon the Issuer, the Company and their respective
successors and assigns, subject to the limitation that any obligation of the
Issuer created by or arising out of this Agreement
34
39
shall not be a general debt of the Issuer but shall be payable solely out of the
Trust Estate, anything herein contained to the contrary by implication or
otherwise notwithstanding.
SECTION 13.6. Severability. If any clause, provision or section of this
Agreement be held illegal or invalid by any court, the invalidity of such
clause, provision or section shall not affect any of the remaining clauses,
provisions or sections hereof and this Agreement shall be construed and enforced
as if such illegal or invalid clause, provision or section had not been
contained herein. In case any agreement or obligation contained in this
agreement be held to be in violation of law, then such agreement or obligation
shall be deemed to be the agreement or obligation of the Issuer or the Company,
as the case may be, to the full extent permitted by law.
SECTION 13.7. Captions. The captions or headings in this Agreement are
for convenience only and in no way define, limit or describe the scope or intent
of any provision or sections of this Agreement.
SECTION 13.8. Interpretation. This Agreement shall be governed by and
interpreted in accordance with the laws of the State.
SECTION 13.9. Execution in Counterparts. This Agreement may be executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.
(End of Article XIII)
35
40
IN WITNESS WHEREOF, the Issuer has caused this Loan Agreement to be
executed in its name by its Mayor, and attested thereto by its Clerk-Treasurer,
and said Clerk-Treasurer has caused its corporate seal to be hereunto affixed,
and the Company has caused this Loan agreement to be executed in its name by its
authorized representative, all as of the date first above written.
CITY OF LIGONIER, INDIANA
(SEAL) By:
----------------------
Mayor
Attest:-----------------------
Clerk-Treasurer
XXXXXX MANUFACTURING COMPANY
By:
-------------------------
Xxxx Xxxxxxx, Treasurer
36
41
EXHIBIT A
COMPLETION CERTIFICATE
TO: CITY OF LIGONIER, INDIANA
NBD BANK, N.A.
FORT XXXXX NATIONAL BANK
FROM: XXXXXX MANUFACTURING COMPANY
SUBJECT: LOAN AGREEMENT DATED AS OF THE 1ST DAY OF JUNE, 1992
The undersigned does hereby certify:
1. The acquisition, construction and installation of the Project have
been substantially completed in such manner as to conform with all applicable
zoning and planning regulations of the governmental authorities having
jurisdiction of the Project, as of __________, 19__ (the "Completion Date").
2. The Costs of the Project have been paid in full except for those not
yet due and payable, which are described below and for which moneys for payment
thereof are being held in the Construction Fund:
Cost of the Project not yet due and payable:
Description Amount
$__________
Total $__________
3. The Moneys in the Construction Fund in excess of the totals set
forth in 2 above represent Surplus Bond Proceeds and the Trustee is hereby
authorized and directed to transfer all such Surplus Bond Proceeds to the Bond
Fund pursuant to Section 5.4 of the Loan Agreement.
4. No event of default has occurred under the Promissory Note, the Loan
Agreement or the Reimbursement Agreement nor has any event occurred which with
the giving of notice or lapse of time or both shall become such an event of
default. Nothing has occurred to the knowledge of the Company that would prevent
the performance of its obligations under the Promissory Note, the Loan Agreement
or the Reimbursement Agreement.
37
42
This certificate is given without prejudice to any rights against third
parties which exist at the date hereof or which may subsequently come into
being.
Executed his _____ day of __________, 19__.
XXXXXX MANUFACTURING COMPANY
By: ____________________________________
Its: ____________________________________
38
43
EXHIBIT B
COSTS OF THE PROJECT
The following are the estimated costs of the Project paid for out of
proceeds of the Bonds:
Construction Costs $4,500,000
Machinery and Equipment 1,800,000
Issuance Costs -0-
TOTAL $6,300,000
39
00
XXXXXXX X
XXXX XX XXXXXXXX, XXXXXXX
PROMISSORY NOTE
$6,300,000 Dated as of June 1, 1992
FOR VALUE RECEIVED, Xxxxxx Manufacturing Company, a Michigan
corporation (the "Company"), promises to pay to the order of the City of
Ligonier, Indiana (the "Issuer"), the principal sum of Six Million Three Hundred
Thousand Dollars ($6,300,000) together with (a) interest thereon in an amount
sufficient to enable the Issuer to make payment of all interest becoming due and
payable on the Issuer's Economic Development Revenue Bonds (Xxxxxx Manufacturing
Company Project), Series 1992, dated as of June 12, 1992 (the "Bonds") in the
principal amount of Six Million Three Hundred Thousand Dollars ($6,300,000),
issued pursuant to a Trust Indenture dated as of June 1, 1992 (the "Indenture")
between the Issuer and Fort Xxxxx National Bank, a national banking association,
as Trustee (the "Trustee"), which Indenture and Bonds are incorporated herein by
reference and made a part hereof, and (b) such redemption premiums and other
amounts as are required to be paid by the Company to the Issuer as Loan
Repayments as provided in the Loan Agreement, dated as of June 1, 1992 between
the Company and the Issuer (the "Loan Agreement"), which is incorporated herein
by reference and made a part hereof.
The foregoing amounts shall be paid by means of Loan Repayments which
shall be due and payable (less any credits to which the Company may be entitled
under the Loan Agreement), in immediately available funds, as follows:
A. On or before each date on which a payment of interest is due on the
Bonds, the Company shall pay interest in an amount equal to the aggregate unpaid
interest due or to become due on the Bonds on such payment date, less any
Eligible Funds (as defined in the Indenture) then held by the Trustee in the
Bond Fund (as defined in the Indenture) which are then being held for
application to the payment of interest on the Bonds in accordance with the
Indenture;
B. On or before each date on which a payment of principal and premium,
if any, is due on the Bonds, whether by maturity, redemption, acceleration or
otherwise, the Company shall pay principal and premium, if any, in an amount
equal to principal and premium, if any, then due or to become due on the Bonds
on such payment date, less any Eligible Funds then held by the Trustee in the
Bond Fund, other than those Eligible Funds applied to payment of interest on the
Bonds as set forth above, which are then being held for the payment of principal
and premium, if any, on the Bonds under the Indenture.
40
45
The Company shall have the option to make advance payments of Loan
Repayments, from time to time, which advance payments shall be deposited with
the Trustee in the Bond Fund and shall be applied as provided in the Loan
Agreement and the Indenture.
All payments shall be made in coin or currency of the United States of
America in immediately available funds at the principal office of the Trustee,
or at the office of any successor trustee.
If the Company fails to pay any installment of principal, premium, if
any, and interest when due under this Promissory Note and the Trustee fails to
receive sufficient moneys pursuant to one or more draws under the Letter of
Credit (as defined in the Indenture) to pay any such installment, or upon the
occurrence of any one or more of the events of default specified in the Loan
Agreement, the Trustee then, or at any time thereafter, may under certain
conditions specified in Section 602 of the Indenture give notice to the Company
declaring all unpaid amounts then outstanding hereunder or under the Loan
Agreement (including all fees), to be due and payable, and thereupon, without
further notice or demand, all such amounts shall become and be immediately due
and payable. Failure to exercise this option shall not constitute a waiver of
the right to exercise the same at any time in the event of any continuing or
subsequent default.
All payments hereon shall be applied first to accrued interest, then to
premium, if any, and then to principal.
The undersigned waives demand, protest, presentment for payment and
notice of nonpayment and agrees to pay all costs of collection when incurred,
including reasonable attorneys' fees, and to perform and comply with each of the
covenants, conditions, provisions and agreements of the undersigned contained in
every instrument evidencing or securing the indebtedness evidenced hereby. No
extension of the time for the payment of this Promissory Note made by agreement
with any person now or hereafter liable for the payment of this Promissory Note
shall operate to release, discharge, modify, change or affect the original
liability under this Promissory Note, either in whole or in part, of the
undersigned if not a party to such agreement.
This Promissory Note is issued under and is subject to the terms and
conditions of the Loan Agreement.
41
46
This Promissory Note and all instruments securing the same are to be
construed according to the laws of the State of Indiana.
XXXXXX MANUFACTURING COMPANY
By: ____________________________
Xxxx Xxxxxxx, Treasurer
Attest:
_____________________
42
47
ENDORSEMENT
Pay to the order of Fort Xxxxx National Bank, as Trustee under the
Trust Indenture dated as of June 1, 1992, without warranty or recourse.
CITY OF LIGONIER, INDIANA
By: _____________________
Mayor
(SEAL)
Attest:
________________________________
Clerk-Treasurer
43
48
EXHIBIT D
PROJECT DESCRIPTION
The construction of an approximate 158,000 square foot manufacturing
facility to be located adjacent to County Road 860 W in Noble County, Indiana,
on an approximate 20-acre parcel more particularly described below for the
production of automobile fuel rails, and the acquisition of furnishings,
machinery and equipment to be installed and located therein, including but not
limited to brazing furnaces, stamping presses, tool room equipment, parts
washer, office furnishings.
44
49
EXHIBIT E
REQUISITION CERTIFICATE
TO: FORT XXXXX NATIONAL BANK
AS TRUSTEE
FROM: XXXXXX MANUFACTURING COMPANY
(THE "COMPANY")
SUBJECT: LOAN AGREEMENT DATED AS OF THE FIRST DAY OF JUNE, 1992
This represents Requisition Certificate No. _____ in the total amount
of $__________ for payment of those Costs of the Project detailed in the
schedule attached.
The undersigned does certify that:
1. All of the expenditures for which moneys are requested hereby
represent proper Costs of the Project, have not been included in a previous
Requisition Certificate and have been properly recorded on the Company's books.
2. The moneys requested hereby are not greater than those necessary to
meet obligations due and payable or to reimburse the Company for funds actually
advanced for Costs of the Project. The moneys requested do not include retention
or other moneys not yet due or earned under construction contracts.
3. After payment of moneys hereby requested, there will remain
available to the Company (from, among other sources, the Construction Fund)
sufficient funds to complete the Project.
4. At least 95% of the sum of the payment herein requested from the
Construction Fund and all other payments from the proceeds of the Series 1992
Bonds heretofore and hereafter to be made from the Construction Fund have been
and will be used to finance the acquisition and installation of machinery and
equipment for the Project, all of which property other than land is of a
character subject to the allowance for depreciation under Section 167 of the
Code, all of which costs for such property or land were first incurred
subsequent to December 16, 1991, and no more than 5% of the sum of the payment
herein requested from the Construction Fund and all other payments from the
proceeds of the Series 1992 Bonds heretofore and hereafter to be made from the
Construction Fund has been or will be used, directly or indirectly, as working
capital or to finance inventory or Issuance Costs.
45
50
5. The Company is not in default under the Promissory Note, the Loan
Agreement or the Reimbursement Agreement and nothing has occurred to the
knowledge of the Company that would prevent the performance of its obligations
under the Loan Agreement, the Promissory Note or the Reimbursement Agreement.
6. Delivered herewith are all of the documents in form and content
required by Section 5.1 of the Loan Agreement and the following other documents
requested by either of you:
Executed this _____ day of __________, 19__.
XXXXXX MANUFACTURING COMPANY
By: ____________________________________
Its: ____________________________________
46
51
SCHEDULE TO REQUISITION CERTIFICATE NO. _____
PAYEE AND LOCATION AMOUNT
$__________
47
52
EXHIBIT F
LAND
The Project site consists of a tract of land located in the Northwest
Quarter of Section 22, Township 35 North, Range 8 East, in Noble County, the
State of Indiana, as more fully described as follows:
Commencing at the Northeast Corner of said Northwest Quarter marked by
a Harrison Marker found this survey; thence N. 89E 17' 20" W. (1), along the
North line of said Northwest Quarter, for 706.70 feet to the intersection of the
center line of Main Street extended with the North line of said Northwest
Quarter; thence S. 00E 14' 29" W., along the center line of Main Street
Extended, for 1180.36 feet to the point of beginning marked by a RR Spike set
this survey; thence continuing S. 00E 14' 29" W., along the center line of Main
Street Extended, for 935.00 feet to a RR Spike set this survey at a point that
is N. 00E 14' 29" E., a distance of 62.00 feet from the Northeast Corner of a
tract of land deeded to Xxxxx X. Xxxx per Xxxxx County Deed Record Book 185,
Page 533; thence N. 85E 10' 31" W., parallel to the North line of said tract of
land deeded to Xxxxx X. Xxxx, for 970.92 feet to a Rebar set this survey; thence
N. 00E 14' 29" E., parallel to the center line of Main Street Extended, for
865.35 feet to a Rebar set this survey; thence S. 89E 17' 20" E., parallel to
the North line of said Northwest Quarter, for 967.85 feet to the point of
beginning, said tract containing 20.00 Acres, more or less, and being subject to
all public road right-of-ways and all easements of record.
(1) Basis of Bearing for this survey is the same as that shown on Plat
of Survey #00-00-00-00 as prepared by Xxxxxx and Associates. The West line of
the Southwest Quarter of Section 15, Township 35 North, Range 8 East was assumed
to be North-South.
A survey of said tract being represented by Plat of Survey #00-00-00-00
as prepared by Xxxxxx and Associates, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxxx,
Xxxxxxx 00000. Any apparent encroachments affecting said tract of land are as
shown on the Plat of Survey. The above described tract of land does not lie
within Zone A Flood Hazard Boundary as shown on the Flood Insurance Rate Map
Community-Panel Number 180183-0025B as prepared by the Federal Emergency
Management Agency.
48
53
EXHIBIT G
NO ACT OF BANKRUPTCY CERTIFICATE
TO: City of Ligonier, Indiana (the "Issuer"), Fort Xxxxx National Bank
(the "Trustee") and NBD Bank, N.A.
FROM: Xxxxxx Manufacturing Company (the "Company")
SUBJECT: $6,300,000 City of Ligonier, Indiana Economic Development
Revenue Bonds (Xxxxxx Manufacturing Company Project), Series 1992
The undersigned does hereby certify:
1. That on __________, 19__ (the "Payment Date") the Company made its
due and timely Loan Repayment as required by the Loan Agreement and/or moneys
were transferred to the Bond Fund for which this certificate is required prior
to such moneys becoming Eligible Funds as provided in the Loan Agreement in the
amount of $__________.
2. That between the Payment Date and the date hereof not less than
__________ (_____) consecutive full calendar days have elapsed prior to and
during which period no voluntary or involuntary petition in bankruptcy (or other
commencement of a bankruptcy or similar proceeding) has been filed by or against
the Company as debtor under any applicable bankruptcy, insolvency,
reorganization or similar law, now or hereafter in effect.
The Company acknowledges that the Trustee may conclusively rely on this
Certificate.
Under penalties of perjury, this Certificate has been executed this
_____ day of __________, 19__, by the duly authorized officers of the Company.
____________________________________
Company
49
