REA Project Designation:
TENNESSEE 521-T8 DEKALB
TELEPHONE LOAN
CONTRACT AMENDMENT
Dated as of March 17, 1980
between
DEKALB TELEPHONE COOPERATIVE
and
UNITED STATES OF AMERICA
No. 1
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AGREEMENT, made as of March 17, 1980, between DEKALB
TELEPHONE COOPERATIVE (hereinafter called the "Borrower"),
a corporation existing under the laws of the State of
TENNESSEE, and UNITED STATES OF AMERICA (hereinafter called
the "Government"), acting through the Administrator of the
Rural Electrification Administration (hereinafter called the
"Administrator").
WHEREAS, the Government and the Borrower have heretofore entered into
a telephone loan contract, amending telephone loan contract, consolidating
telephone loan contract, or consolidating and amending telephone loan
contract, dated as of October 15, 1951 (such agreement, as it may have been
amended, being hereinafter called the "Loan Contract"); and
WHEREAS, it is intended by this agreement to amend the Loan Contract
by increasing the amount of the loan therein provided for through a loan from
the Government to the Borrower of not to exceed $7,327,000 (hereinafter
called the "Loan Increase"), and in certain other respects;
NOW, THEREFORE, for and in consideration of the mutual agreements
herein contained, the Borrower and the Government agree as follows:
SECTI ON 1. The definition of "Project" in the Loan Contract is
amended by changing to 12,884 the approximate number of subscribers to be
served thereby (aside from those served by "Existing Facilities", if any, as
defined in the Loan Contract).
SEC. 2. Section 1.1 of the Loan Contract is amended by (a)
increasing the maximum amount which the Government shall lend and the
Borrower shall borrow, by the amount of the Loan Increase, and (b) adding the
following to the counties listed in said Section:
NONE
SEC. 3. The provisions set forth in Exhibit I hereto, pages 1-1
through I- 5, and by this reference made a part hereof, shall amend and
supersede all provisions of the Loan Contract inconsistent therewith. If the
Loan Contract does not include "System" as a defined term, any reference to
"System" in this agreement, including Exhibit I, shall be read as "Project".
If the Loan Contract does not include "Project" as a defined term, any
reference to "Project" in this agreement, including Exhibit I, shall be read
as "System".
SEC. 4. The debt created by the Loan Increase shall be evidenced by
additional notes to be executed by the Borrower pursuant to the Loan
Contract, as amended hereby, which shall bear interest at the rate of five
(5.0%) per centum per annum.
SEC. 5. (A) Notwithstanding anything contained in this agreement or
the Loan Contract, the Government shall be under no obligation to advance to
the Borrower any portion of the Loan Increase unless and until the following
con-dition(s), in addition to all other conditions of the Loan Contract and
this agreement which are precedent to the advance of loan funds, shall have
been satisfied:
(a) the Borrower shall have delivered to the
Administrator, in form and substance satisfactory to him, evidence
that the Borrower has duly authorized, executed, recorded and filed
a security instrument, in form and substance satisfactory to the
Administrator.
(B) The first advance of loan funds on account of
the loan increase shall be limited to: (1) an amount then owing for
interim construction pursuant to REA letters of September 27, 1979,
and December 17, 1979; and (2) the cost of preloan engineering
services in an amount to be approved by the Administrator.
Thereafter, the Government shall not be
obligated to make any further advances on account of the Government
loan increase until the borrower shall have submitted evidence, in
form and substance satisfactory to the Administrator, that all
indebtedness incurred for interim construction referred to above in
this subsection and all liens, if any, connected therewith have been
duly discharged of record.
(C) The Borrower covenants and agrees that it will
spend $750,000 of its general funds for station installations
sufficient to meet the subscriber projection in the "T8" loan.
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SEC. 6. Counterparts. This agreement may be simultaneously
executed and delivered in two or more counterparts, each of which so executed
and delivered shall be deemed to be an original, and all shall constitute but
one and the same instrument.
IN WITNESS WHEREOF the Borrower has caused this agreement to be
signed in its corporate name and its corporate seal to be hereunto affixed
and attested by its officers thereunto duly authorized, and the Government
has caused this agreement to be duly executed all as of the day and year
first above written.
DEKALB TELEPHONE COOPERATIVE
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
President
(Seal)
Attest: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Secretary
UNITED STATES OF AMERICA
by /s/
Administrator
of
Rural Electrification Administration
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EXHIBIT I
1. Definitions.
-----------
Each term defined in the Loan Contract and in the agreement
("Underlying Agreement") of which this Exhibit is a part shall have the same
meaning when used in this Exhibit I. As used in this Exhibit I, "this
Agreement" shall mean the Underlying Agreement together with this Exhibit I.
2. Interest on Notes.
-----------------
The Notes with respect to any portion of the Loan shall bear interest
at the rate specified in the loan agreement relating thereto, and shall
other-wise be in form and substance satisfactory to the Administrator.
3. Prerequisites to Advances.
-------------------------
The Government shall be under no obligation to advance funds from
time to time on account of the Loan, unless and until the Borrower shall have
(a) complied with the provisions of section 2.1 of the Loan Contract (or such
other section thereof as is headed "Prerequisites to Advances"), and (b)
delivered to the Administrator, in form and substance satisfactory to him,
evidence that the Borrower has duly adopted a tariff which (1) will provide
for such grades of service as the Administrator may approve, (2) does not
include mileage or zone charges for the lowest grade of service provided in
each central office area and (3) is designed to produce revenues sufficient
to meet all necessary expendi-tures, including all interest and principal
payments under the Notes.
4. Special Construction Account.
----------------------------
The Borrower shall promptly deposit all moneys advanced to it by the
Government hereunder in a special construction account (hereinafter called
"Special Construction Account") in a bank or banks, which shall meet the
requirements specified in section 4.3 of the Loan Contract (or such other
section thereof as is headed "Deposit of Funds"), and shall hold such moneys
in trust for the Government until disbursed. Any Special Construction Account
shall be designated by the corporate name of the Borrower, followed by the
words "Trustee, REA Construction Fund Account." All loan funds in any Special
Construction Account shall be used solely for the purposes specified in
section 1.1 of the Loan Contract, as amended by this Agreement and any
subsequent amendment. If the Borrower is required to obtain equity funds by
the terms of the Loan Contract, as amended by this Agreement or any
subsequent amendment, the Borrower shall also deposit all such equity funds
in the Special Construction Account on the same terms and conditions and for
the same purposes as funds advanced on account of the Loan. Equity funds may
be withdrawn from the Special Construction Account only upon approval by the
Administrator of requisitions therefor submitted by the Borrower in
accordance with the requirements applicable to the requisitioning of loan
funds, as set forth in section 2.2 of the Loan Contract (or such other
section thereof as is headed "Requisitions") except that to the extent equity
funds (if required to be obtained) arc expressly required to be used for
other purposes under the Loan Contract, as amended by this Agreement and any
subsequent amendment, they shall be used for such other purposes. Until the
aggregate amount of withdrawals from the Special Construction Account shall
equal or exceed the amount of the equity funds, they shall be deemed to have
been made from equity funds and not from funds advanced by the Government to
the Borrower. The Borrower shall expend each advance on account of the Loan
or equity funds, if any, only for such of the purposes specified in the
statement of purposes accompanying the requisition for such advance or equity
funds, if any, as shall have been approved by the Administrator.
5. Particular Covenants.
--------------------
(A) Submission of Contracts with Third Parties. The Borrower
shall submit, when requested by the Administrator and subject to the
Administrator's approval:
I-1
(1) a contract or contracts for the joint use of
facilities of other companies, as may be necessary for the
construction or proper operation of the System;
(2) a contract or contracts for the purchase, lease, or
other acquisition of land for use in connection with the construction
or operation of the System; and
(3) a contract or contracts for extended area service to
be provided by or for other companies, as may be necessary for the
proper operation of the System.
(B) Evidence of Tariff. The Borrower shall deliver, when
requested by, and in form and substance satisfactory to, the Administrator,
evidence that the Borrower has in effect a tariff which will provide for such
grades of service as the Administrator may approve and which does not include
mileage or zone charges for the lowest grade of service provided in each
central office area.
(C) Easements and Permits - Equity Funds. If the Borrower is
required to obtain equity funds by the terms of the Loan Contract, as amended
by this Agreement or any subsequent amendment, none of such funds shall be
used by the Borrower to pay for easements obtained from land owners, or for
releases of lien affecting easements.
(D) Area Coverage. The Borrower shall furnish adequate telephone
service to the widest practicable number of rural users in the Borrower's
telephone service area, as such area is shown on the map which is a part of
the Borrower's application for the Loan, and which map, as revised by
agreement between the Borrower and the Administrator, is incorporated herein
by reference thereto. In the performance of this obligation, the Borrower
shall (except to the extent that the Administrator, upon request of the
Borrower, may in writing authorize deviations therefrom):
(1) furnish service to all applicants for service
included in the Project, without payment by such applicants of any
extra charge as a contribution to the cost of construction of
facilities to provide such service; and
(2) take all action that may be required to enable it to
extend service, with the use of such funds as may from time to time
be available to it, either from surplus earnings, increased equity
capital, additional loans made by lenders other than the Government,
or otherwise as the Borrower may elect, and without payment to the
Borrower of any extra charge as a contribution to construction of
facilities to provide such service, to every other unserved rural
applicant for service in its telephone service area if the cost of
constructing the required line extension for such applicant will not
exceed seven times the estimated annual local service revenues from
such applicant. Such service shall be furnished pursuant to terms and
conditions set forth in the Borrower's tariff, as duly filed with or
approved by regulatory bodies having jurisdiction in the premises,
or in the absence of any such regulatory body, as adopted by the
Borrower; provided that the Borrower shall not file with or submit
for approval of appropriate regulatory bodies or adopt any proposed
tariff, or continue in effect any existing tariff not required to be
continued by any regulatory body, unless under such tariff the
Borrower will be obligated to serve unserved rural applicants as
provided herein.
(E) Equal Opportunity Clause. The Borrower hereby agrees that it
will incorporate or cause to be incorporated into any contract for
construction work, or modification thereof, as defined in Executive Order
11246 or in the rules and regulations of the Secretary of Labor, which is
paid for in whole or in part with funds obtained from the Federal Government
or borrowed on the credit of the Federal Government pursuant to a grant,
contract, loan, insurance or guarantee, or undertaken pursuant to any Federal
program involving such grant, contract, loan, insurance or guarantee, the
following equal opportunity clause:
I-2
During the performance of this contract, the contractor agrees as
follows:
(1) The contractor will not discriminate against any employee or
applicant for employment because of race, color, religion, sex or national
origin. The contractor will take affirmative action to ensure that
applicants are employed, and that employees are treated during employment
without regard to their race, color, religion, sex or national origin. Such
action shall include, but not be limited to the following: employment,
upgrading, demotion or transfer; recruitment or recruitment advertising;
layoff or termination; rates of pay or other forms of compensation; and
selection for training, including apprenticeship. The contractor agrees to
post in conspicuous places, available to employees and applicants for
employment, notices to be provided setting forth the provisions of this
nondiscrimination clause.
(2) The contractor will, in all solicitations or advertisements
for employees placed by or on behalf of the contractor, state that all
qualified applicants will receive consideration for employment without regard
to race, color, religion, sex or national origin.
(3) The contractor will send to each labor union or
representatives of workers with which he has a collective bargaining
agreement or other contract or understanding, a notice to be provided
advising the said labor union or workers' representative of the contractor's
commitments under this section, and shall post copies of the notice in
conspicuous places available to employees and applicants for employment.
(4) The contractor will comply with all provisions of Executive
Order 11246 of September 24, 1965, and of the rules, regulations and relevant
orders of the Secretary of Labor.
(5) The contractor will furnish all information and reports
required by Executive Order 11246 of September 24, 1965, and by the rules,
regulations and orders of the Secretary of Labor, or pursuant thereto, and
will permit access to his books, records and accounts by the administering
agency and the Secretary of Labor for purposes of investigation to ascertain
compliance with such rules, regulations and orders.
(6) In the event of the contractor's noncompliance with the
nondiscrimination clauses of this contract or with any of the said rules,
regulations or orders, this contract may be cancelled, terminated or
suspended in whole or in part and the contractor may be declared ineligible
for further Government contracts or federally assisted construction contracts
in accordance with procedures authorized in Executive Order 11246 of
September 24, 1965, and such other sanctions may be imposed and remedies
invoked as provided in the said Executive Order or by rule, regulation or
order of the Secretary of Labor, or as otherwise provided by law.
(7) The contractor will include the provisions of paragraphs (1)
through (7) in every subcontract or purchase order unless exempted by rules,
regulations or orders of the Secretary of Labor issued pursuant to section
204 of Executive Order 11246 of September 24, 1965, so that such provisions
will be binding upon each subcontractor or vendor. The contractor will take
such action with respect to any subcontract or purchase order as the
administering agency may direct as a means of enforcing such provisions,
including sanctions for noncompliance: Provided, however, That in the event
a contractor becomes involved in, or is threatened with, litigation with a
subcontractor or vendor as a result of such direction by the agency, the
contractor may request the United States to enter into such litigation to
protect the interests of the United States.
The Borrower further agrees that it will be bound by the above equal
opportunity clause in any federally assisted construction work which it
performs itself other than through the permanent work force directly employed
by an agency of government.
I-3
The Borrower agrees that it will cooperate actively with the
administering agency and the Secretary of Labor in obtaining the compliance
of contractors and subcontractors with the equal opportunity clause and the
rules, regulations and relevant orders of the Secretary of Labor, that it
will furnish the administering agency and the Secretary of Labor such
information as they may require for the supervision of such compliance, and
that it will otherwise assist the administering agency in the discharge of
the agency's primary responsibility for securing compliance. The Borrower
further agrees that it will refrain from entering into any contract or
contract modification subject to Executive Order 11246 with a contractor
debarred from, or who has not demonstrated eligibility for, Government
contracts and federally assisted construction contracts pursuant to Part II,
Subpart D of Executive Order 11246 and will carry out such sanctions and
penalties for violation of the equal opportunity clause as may be imposed
upon contractors and subcontractors by the administering agency or the
Secretary of Labor pursuant to Part II, Subpart D of Executive Order 11246.
In addition, the Borrower agrees that if it fails or refuses to comply with
these undertakings the administering agency may cancel, terminate or suspend
in whole or in part this contract, may refrain from extending any further
assistance under any of its programs subject to Executive Order 11246 until
satisfactory assurance of future compliance has been received from such
Borrower, or may refer the case to the Department of Justice for appropriate
legal proceedings.
(F) Environment. The Borrower shall, with respect to all
facilities which may be part of the System, comply with applicable water and
air pollution control standards and other environmental requirements imposed
by federal or state statutes or regulations.
(G) Historic Preservation. The Borrower shall not, without
approval in writing by the Administrator, use any portion of the Loan to
construct any facilities which will involve any district, site, building,
structure or object which is included in the National Register of Historic
Places, maintained by the Secretary of the Interior pursuant to the Historic
Sites Act of 1935 and tile National Historic Preservation Act.
(H) Deletion of Provisions Relating to the Level of General
Funds. If the Loan Contract contains provisions in section 2.8, or elsewhere,
relating to the level of the Borrower's general funds, such provisions are
deleted.
(I) Deletion of Provisions Relating to Construction Schedules.
If the Loan Contract contains provisions in section 2.9, or elsewhere,
relating to the Borrower's construction schedules, such provisions are
deleted.
I-4
6. Countersignature.
----------------
Subject to the provisions of paragraph 7 of this Exhibit I and
section 6.2(c) of the Loan Contract (or subsection (c) of such other section
of the Loan Contract as in headed "Remedies upon Default"), moneys in any
Special Construction Account may be withdrawn only upon checks, drafts or
orders signed on behalf of the Borrower and countersigned by an executive
officer thereof.
7. Supervisor: Appointment and Powers.
-----------------------------------
If the construction of the Project or any section or sections
thereof, shall not proceed in accordance with the terms of the Loan Contract,
as amended by this Agreement
or any subsequent amendment to the Loan Contract, or if default shall be made
in the payment of any installment of or on account of interest on or
principal of any Note when and as the same shall be required to be made and
such default shall continue for thirty (30) days, the Administrator may
appoint a supervisor (hereinafter called the "Supervisor") for the System, or
such section or sections thereof as the Administrator shall designate, as the
representative of the Government and notify the Borrower of such appointment
and the duration thereof. The Supervisor shall take such steps as he deems
necessary to assure construction or operation of the Project in accordance
with the terms hereof, or such portion or portions thereof as may be
designated by the Administrator, or to assure performance of any other
obligations of the Borrower pursuant to the provisions of the Loan Contract,
as amended by this Agreement and any subsequent amendment, or of the Notes,
and shall have power to operate the System and other property of the Borrower
necessary to the operation of the System, and do all things reasonably
incident to the exercise of the powers herein granted, including, without
limitation, directing the conservation of any funds of the Borrower, the
collection of all debts due it, the payment of all expenses of the Borrower
from any of its funds, the termination of the employment of such employees of
the Borrower as he shall determine upon and the employment of such persons,
on such terms and conditions as he may designate, as he shall deem necessary
to assist him in carrying out his functions. The salaries, fees,
disbursements and the expenses of the Supervisor and of any employee
appointed by him shall be paid by the Borrower; provided, however, that the
salaries, fees, disbursements and expenses of any supervisor who shall be an
employee of the Government, and of any assistants who shall be employees of
the Government, shall not be payable by the Borrower unless and to the extent
that the Administrator, upon written notification to the Borrower, shall so
require. So long as the appointment of the Supervisor shall be in effect, all
checks, drafts, and orders drawn on any bank account maintained by the
Borrower shall be countersigned by the Supervisor, except that, if the proper
officers or employees of the Borrower shall refuse to sign any such check,
draft or order, the Supervisor shall have full power and authority to sign
such check, draft or order for the Borrower without the requirement of any
other signature thereon, if such check, draft or order is required to carry
out the obligations of the Borrower hereunder. The Borrower hereby
constitutes the Administrator its agent for the purpose of notifying any bank
in which any account of the Borrower shall be maintained of the appointment
of a Supervisor and of the provisions hereunder with respect thereto, and
agrees that such notice shall include a direction to any such bank with
respect to the signing or countersigning of the checks, drafts or orders
drawn on any such account as in this section provided. The Borrower shall
comply with all reasonable instruction of the Supervisor incident to carrying
out the obligations of the Borrower hereunder or the performance of the
functions of the Supervisor.
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