Exhibit 10.41
THIS (the "Agreement") dated as of September 1, 2006
is made by and between Snowflake White Mountain Power, LLC (the "Company"), an
Arizona limited liability company and a wholly-owned indirect subsidiary of NZ
Legacy, LLC, an Arizona limited liability company, and Xxxxxxxx Xxxxxx Inc.
The Industrial Development Authority of the City of Show Low, Arizona (the
"Issuer"), a nonprofit corporation designated as a political subdivision under
the Constitution and laws of the State of Arizona, is issuing $39,250,000
aggregate principal amount of its Solid Waste Disposal Revenue Bonds (Snowflake
White Mountain Power, LLC Project) Series 2006 (the "Bonds") pursuant to an
Indenture of Trust dated as of September 1, 2006 (the "Indenture") between the
Issuer and X.X. Xxxxxx Trust Company, National Association, as trustee (the
"Trustee").
The proceeds of the sale of the Bonds will be used to provide funds to loan
to the Company pursuant to the Loan Agreement dated as of September 1, 2006,
between the Issuer and the Company, to finance the costs of the acquisition,
construction and installation of certain solid waste disposal facilities for use
by the Company, as part of the Company's electric generation facility in Navajo
County, Arizona.
The Company will also cause CoBank, ACB (the "Fronting Credit Facility
Provider"), to deliver its irrevocable direct-pay letter of credit (the
"Fronting Credit Facility") to the Trustee and will cause JPMorgan Chase Bank,
N.A. (the "Confirming Credit Facility Provider," and together with the Fronting
Credit Facility Provider, the "Credit Facility Provider") to deliver its
irrevocable confirmation (the "Confirming Credit Facility," and together with
the Fronting Credit Facility, the "Credit Facility") to the Trustee, to support
payment of the principal and purchase prices of and interest on the Bonds during
the term of the Credit Facility.
Intending to be legally bound, the parties hereto agree as follows:
1. Acceptance of Appointment and Obligations of Remarketing Agent.
(a) Xxxxxxxx Xxxxxx Inc. hereby accepts its appointment as the Remarketing
Agent (the "Remarketing Agent") for the Bonds and hereby accepts and agrees to
perform the duties and obligations imposed upon it as Remarketing Agent under
the Indenture. The Remarketing Agent hereby represents that it is qualified to
act as Remarketing Agent in accordance with the requirements of the Indenture
and agrees to abide by all of the provisions of the Indenture insofar as they
govern its activities as Remarketing Agent for the Bonds. The Remarketing Agent
will promptly notify the Company if it ceases to meet the requirements of the
Indenture. Unless defined otherwise, all terms used herein shall have the same
meaning as in the Indenture.
(b) The Remarketing Agent shall determine the Weekly Rates and, if
applicable, the Fixed Rate in accordance with Article II of the Indenture, and
shall give notice of such rates in the manner and to the persons specified
therein.
(c) The Remarketing Agent shall keep such books and records with respect to
its duties as Remarketing Agent as shall be consistent with prudent industry
practice and shall make such books and records available for inspection by the
Issuer, the Trustee and the Company at all reasonable times during its normal
business hours.
(d) The Remarketing Agent shall use its best efforts to remarket Bonds in
accordance with the Indenture and perform all other duties assigned to it under
the Indenture.
(e) The Remarketing Agent shall hold all Bonds delivered to it for the
benefit of the respective registered owners of the Bonds which shall have so
delivered such Bonds until moneys representing the purchase price of such Bonds
shall have been delivered to or for the account of or to the order of such
registered owners.
(f) The Remarketing Agent shall hold all moneys delivered to it for the
purchase of Bonds in trust for the benefit of the person or entity which shall
have so delivered such moneys until the Bonds purchased with such moneys shall
have been delivered to or for the account of such person or entity.
(g) The Remarketing Agent will not offer any of the Bonds in any
jurisdiction except under circumstances that will result in compliance with the
applicable laws thereof.
2. Fees and Expenses. While the Bonds bear interest at the Weekly Rate, the
Company shall pay the Remarketing Agent, as compensation for its services
hereunder, a fee equal to one-tenth of one percent (.10%) per annum of the
weighted average principal amount of Bonds outstanding during each three-month
period, or such other amount as may be agreed upon from time to time by the
Company and the Remarketing Agent, payable quarterly in arrears on each January
1, April 1, July 1 and October 1, commencing October 1, 2006. The Remarketing
Agent will not be entitled to compensation after this
shall be terminated except for a pro rata portion of the fee in respect of the
quarter in which such termination occurs. Additionally, the Company will
reimburse the Remarketing Agent for its reasonable out-of-pocket expenses in
performing its obligations hereunder, including, without limitation, expenses
incurred in the preparation and distribution of the disclosure documents
referred to in Section 3 hereof and in connection with any proposed conversion
of the Bonds from the Weekly Rate Period to the Fixed Rate Period. The Issuer
shall have no responsibility, obligation or liability with respect to any
payments hereunder. The parties anticipate that separate arrangements for
compensation will be made for the remarketing of Bonds in connection with a
conversion from the Weekly Rate Period to the Fixed Rate Period at the time of
such conversion.
3. Disclosure Document. If required under any applicable law or as a result
of any material change in the information in a disclosure document theretofore
used by the Remarketing Agent in connection with the remarketing of the Bonds
(which may include the Official Statement distributed in connection with the
sale of the Bonds by the Underwriter (the "Official Statement")), the Company
promptly will provide the Remarketing Agent with a disclosure document
reasonably satisfactory to the Remarketing Agent and its counsel in respect of
the Bonds. The Company will supply the Remarketing Agent with such number of
copies of the disclosure document as the Remarketing Agent reasonably requests
from time to time. The
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Company will supplement and amend the disclosure document so that, at all times
when used in connection with the remarketing of the Bonds, the disclosure
document will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements in the disclosure
document, in the light of the circumstances under which they were made, not
misleading. The Company shall not, however, be required to make representations
or warranties as to statements or omissions based upon information furnished to
the Company in writing by or on behalf of the Remarketing Agent expressly for
use therein.
The Company agrees to notify the Remarketing Agent promptly in writing of
the occurrence of any of the following events:
(a) any Default or Event of Default under the Indenture of which it has
knowledge;
(b) any notice to the Company from the Trustee that it intends to resign;
(c) any event with respect to the Bonds which requires the delivery of an
opinion of Bond Counsel pursuant to the Indenture;
(d) any optional redemption or extraordinary optional redemption pursuant
to the Indenture; or
(e) any mandatory redemption pursuant to the Indenture.
The Company hereby acknowledges the requirements imposed on the Remarketing
Agent by Securities and Exchange Commission Rule 15c2-12, as amended (the
"Rule"). The Bonds are currently exempt under Section (d)(1) of the Rule. The
Company covenants and agrees that, should the Bonds no longer be exempt under
the Rule, the Company will comply with the continuing disclosure requirements
pursuant to Section (b)(5)(i) of the Rule and take such other actions as shall
be reasonably necessary to enable the Remarketing Agent to comply with the Rule.
4. Indemnification. The Company agrees to indemnify and hold harmless the
Remarketing Agent, its directors, officers and employees and each person, if
any, who controls the Remarketing Agent within the meaning of either Section 15
of the Securities Act of 1933, as amended (the "Securities Act"), or Section 20
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), from
and against any and all losses, claims, damages and liabilities (a) caused by
any untrue statement or alleged untrue statement of a material fact contained in
any disclosure document referred to in Section 3 hereof distributed in
connection with the remarketing of the Bonds or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to the
Remarketing Agent furnished to the Company in writing by the Remarketing Agent
expressly for use therein, or (b) arising out of or based upon an allegation or
determination that the Bonds or any other security relating to the Bonds should
have been registered under the Securities Act or the
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Exchange Act or the Indenture should have been qualified under the Trust
Indenture Act of 1939, as amended, in connection with the reoffering and sale of
the Bonds.
The Remarketing Agent agrees to indemnify and hold harmless the Company,
its directors, officers and employees, and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, to the same extent as set forth in paragraph (a) of the
foregoing indemnity from the Company to the Remarketing Agent, but only with
reference to information relating to the Remarketing Agent furnished to the
Company in writing by the Remarketing Agent expressly for use in any disclosure
document.
In case any proceeding (including any governmental investigation) shall be
instituted involving any person in respect of which indemnity may be sought
pursuant to either of the two preceding paragraphs, such person (hereinafter
called the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (hereinafter called the "indemnifying party") in
writing and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all such indemnified parties, and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by the
Remarketing Agent in the case of parties indemnified pursuant to the second
preceding paragraph and by the Company in the case of parties indemnified
pursuant to the first preceding paragraph. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the third sentence of this
paragraph, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement
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includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
If the indemnification provided for in the first or second paragraph of
this Section 4 is unavailable to an indemnified party under such paragraph in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company and the Remarketing Agent from the remarketing of the Bonds or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Remarketing Agent in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company and the Remarketing Agent shall be deemed to be in the same
proportion as the total net proceeds of the remarketing (before deducting
expenses) received by or for the account of the Company bear to the total fees
and commissions received by the Remarketing Agent in connection therewith. The
relative fault of the Company and the Remarketing Agent shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Remarketing Agent and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company and the Remarketing Agent agree that it would not be just and
equitable if contribution pursuant to this Section 4 were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 4, the Remarketing Agent shall
not be required to contribute any amount in excess of the aggregate remarketing
fees received by the Remarketing Agent hereunder. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
The indemnity and contribution agreements contained in this Section 4 and
the representations and warranties of the Company shall remain operative and in
full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Remarketing Agent or any person
controlling any Remarketing Agent or by or on behalf of the Company, its
officers or directors or any other person controlling the Company and (iii) sale
and delivery of any of the Bonds.
5. Remarketing Agent's Liabilities. The undertaking of the Remarketing
Agent to remarket any Bonds pursuant to the Indenture shall be on a "best
efforts" basis.
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6. Resignation or Removal of Remarketing Agent. The Remarketing Agent may
be removed at any time by the Company by giving notice to the Remarketing Agent,
the Issuer and the Trustee. The Remarketing Agent may at any time resign and be
discharged of the duties and obligations created by this
by giving at least thirty (30) days' notice to the Company, the Issuer and the
Trustee; provided that the Remarketing Agent may cease to offer and sell the
Bonds with immediate effect if it determines, in its reasonable judgment, that
for any reason, including without limitation, (i) a pending or proposed change
in applicable tax laws or securities laws that would require registration under
the Securities Act in connection with the remarketing of the Bonds; (ii) a
material adverse change in the condition of the Company or the Credit Provider,
(iii) a banking moratorium, (iv) there shall have occurred any outbreak or
escalation of hostilities or any change in financial markets or any calamity or
crisis that, in the Remarketing Agent's judgment, is material and adverse, (v) a
down-rating of the Bonds, (vi) an imposition of material restrictions on the
Bonds or similar obligations, or (vii) a material misstatement or omission in
the Official Statement or the disclosure document referred to in Section 3
hereof, that it is not advisable to attempt to remarket the Bonds. The
provisions of Section 4 will continue in effect as to transactions prior to the
date of termination, and each party will pay the other any amounts owing at the
time of termination.
7. Dealing in Securities by Remarketing Agent. The Remarketing Agent, in
its individual capacity, either as principal or agent, may buy, sell, own, hold
and deal in any of the Bonds, and may join in any action which any owner of
Bonds may be entitled to take with like effect as if it did not act in any
capacity hereunder. The Remarketing Agent, in its individual capacity, either as
principal or agent, may also engage in or be interested in any financial or
other transaction with the Company and may act as depository, trustee, or agent
for any committee or body of owners of Bonds or other obligations of the Company
as freely as if it did not act in any capacity hereunder.
8. Intention of Parties. It is the express intention of the parties hereto
that no purchase, sale or transfer of any Bonds, as herein provided, shall
constitute or be construed to be the extinguishment of any Bond or the
indebtedness represented thereby or the reissuance of any Bond or the refunding
of any indebtedness represented thereby.
9. Amendment. (a) The Company agrees not to consent to any amendment of the
Indenture provisions with respect to the or the rights and
duties of the Remarketing Agent hereunder or thereunder without the prior
written consent of the Remarketing Agent (which shall not be unreasonably
withheld).
(b) This Agreement may not be amended except by a writing signed by each of
the parties hereto; may not be assigned without the mutual consent of the
parties hereto; and will not confer any rights upon any other person or any
holders of Bonds in their capacities as such.
10. Notices. Unless otherwise provided all notices, requests, demands and
formal actions hereunder shall be in writing and mailed, telegraphed or
delivered, as follows:
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If to the Company:
Snowflake White Mountain Power, LLC
0000 Xxxxx Xxx Xxxxx Xxxxx
Xxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
If to the Trustee:
X.X. Xxxxxx Trust Company, National Association
000 X. Xxxx Xxxxxx, 0xx Xxxxx
Mail Code AZ1-5105
Xxxxx, Xxxxxxx 00000
Attention: Corporate Trust Department
If to the Issuer:
The Industrial Development Authority
of the City of Show Low, Arizona
000 Xxxxx 0xx Xxxxx
Xxxx Xxx, Xxxxxxx 00000
Attention: President, Board of Directors
If to the Remarketing Agent:
Xxxxxxxx Xxxxxx Inc.
0000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Public Finance Department
Each of the above parties may, by written notice given hereunder to the
others, designate any further or different addresses to which subsequent
notices, certificates, requests, or other communications shall be sent. In
addition, the parties hereto may agree to any other means by which subsequent
notices, certificates, requests or other communications may be sent.
11. Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of Arizona.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SNOWFLAKE WHITE MOUNTAIN POWER, LLC
By /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Sole Manager
XXXXXXXX XXXXXX INC.
By
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Xxxxx X. Xxxxxx
President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SNOWFLAKE WHITE MOUNTAIN POWER, LLC
By
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Xxxxxx X. Xxxxxxx
Sole Manager
XXXXXXXX XXXXXX INC.
By /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
President
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