EXHIBIT 4.33
6-5452
Form - Restated Mortgage - Telephone
100% REA Loan - No Prior Bank Loan 1/85
REA PROJECT DESIGNATION:
SOUTH DAKOTA 515-S8 IRENE
RESTATED MORTGAGE, SECURITY AGREEMENT, AND FINANCING STATEMENT
made by and between
DAKOTA COOPERATIVE TELECOMMUNICATIONS, INC.
P. ▇. ▇▇▇ ▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Taxpayer Identification #▇▇▇▇▇▇▇▇▇
as mortgagor and debtor,
and
UNITED STATES OF AMERICA
Rural Electrification Administration
Washington, D. C. 20250-1500
as mortgagee and secured party.
THIS INSTRUMENT GRANTS A SECURITY INTEREST IN A TRANSMITTING UTILITY
THE MORTGAGED PROPERTY AND COLLATERAL ARE DESCRIBED ON PAGES 5 - 7
THIS INSTRUMENT CONTAINS AN AFTER-ACQUIRED PROPERTY CLAUSE
Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
RESTATED MORTGAGE, SECURITY AGREEMENT AND FINANCING
STATEMENT, dated as of , 19 , made
by and between DAKOTA COOPERATIVE TELECOMMUNICATIONS, INC.
___________________________________________________________
(hereinafter called the "Mortgagor"), a corporation existing
under the laws of the State of South Dakota, as mortgagor
and debtor, and UNITED STATES OF AMERICA (hereinafter
sometimes called the "Mortgagee" and sometimes called the
"Government"), acting through the Administrator of the Rural
Electrification Administration (hereinafter called "REA"),
as mortgagee and secured party.
WHEREAS, the Mortgagor has heretofore borrowed funds from the
Government, acting through the Administrator of REA, pursuant to a certain
Telephone Loan Contract identified in the fifth recital hereof (hereinafter
called the "Instruments Recital") by and between the Mortgagor and the
Government (said Telephone Loan Contract, as it may have heretofore been,
and as it may hereafter be, amended or supplemented, being hereinafter
called the "Consolidated Loan Contract"); and
WHEREAS, the Mortgagor, for value received, has heretofore duly
authorized and executed, and has delivered to the Mortgagee, or has assumed
the payment of, certain mortgage notes all payable to the order of the
Mortgagee, in installments, of which the mortgage notes (hereinafter
collectively called the "Outstanding Notes") identified in the Instruments
Recital are now outstanding and held by the Mortgagee, all of which
Outstanding Notes evidence loans made or guaranteed by the Government to
the Mortgagor or to a third party or parties to finance telephone
exchanges, lines and related facilities; and
WHEREAS, the Outstanding Notes are secured by the security
instruments (hereinafter collectively called the "Underlying Mortgage")
identified in the Instruments Recital made by the Mortgagor to the
Mortgagee; and
WHEREAS, the Mortgagor has determined to borrow additional funds
from the Government pursuant to the Rural Electrification Act of 1936, as
amended (7 U.S.C. 901 ET SEQ., hereinafter called the "Act"), and pursuant
to the Consolidated Loan Contract, and has accordingly duly authorized and
executed, and has delivered to the Mortgagee, its mortgage note (identified
in the Instruments Recital as and hereinafter called the "Current Note") to
be secured by the Underlying Mortgage, as amended, supplemented,
consolidated and restated hereby; and
Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
WHEREAS, the instruments referred to in the preceding recitals,
the Maximum Debt Limit referred to in Article I, Section 1 hereof, the
subdivision or subdivisions of Article II hereof made applicable by this
recital, and certain data referred to in Article II, Section 15 hereof, are
as follows:
INSTRUMENTS RECITAL
1. The instruments referred to in the preceding recitals are as follows:
"Telephone Loan Contract" dated as of September 5, 1952
"Outstanding Notes": Twenty----------------- ( 20 ) certain mortgage
notes in an aggregate principal amount of $13,337,000--------, all of
which will mature on or before May 23, 2018.
"Underlying Mortgage"
INSTRUMENT DATED AS OF TRUSTEE, IF ANY
Mortgage September 30, 1952
Supplemental Mortgage October 10, 1958
Supplemental Mortgage March 9, 1961
Supplemental Mortgage September 21, 1964
Supplemental Mortgage August 10, 1967
Supplemental Mortgage February 24, 1969
Supplemental Mortgage June 25, 1973
Supplemental Mortgage May 23, 1983
"Current Note"
DATE PRINCIPAL AMOUNT INTEREST RATE FINAL PAYMENT DATE
Of even date $4,140,000 5.0% Thirty-five (35) years
herewith from the date herewith
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Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
2. "Maximum Debt Limit" for purposes of Article I, Section 1 hereof,
shall be fifty million dollars ($50,000,000).
3. The following subdivision(s) of Article II hereof is(are) hereby made
applicable: Section 10a & 18.
4. The percentage referred to in Section 15(a)(1) and Section 15(b) of
Article II hereof is hereby established as ten per centum ( 10%). The
date referred to in Section 15(a)(3) of Article II hereof is hereby
established as December 31, 1963.
WHEREAS, the Underlying Mortgage provides that the Mortgagor
shall, upon the request in writing of the holder or holders of not less
than a majority in principal amount of the notes secured by the Underlying
Mortgage at the time outstanding, duly authorize, execute, and deliver and
record and file all such supplemental mortgages and conveyances as may
reasonably be requested by such holder or holders to effectuate the
intention of the Underlying Mortgage and to provide for the conveying,
mortgaging and pledging of the property of the Mortgagor intended to be
conveyed, mortgaged or pledged by the Underlying Mortgage to secure the
payment of the principal of and interest on notes executed and delivered
thereunder and pursuant thereto, or otherwise secured thereby, and the
Mortgagee, as the holder of all such notes, has in writing requested the
execution and delivery of such a supplemental mortgage pursuant to such
provisions; and
WHEREAS, it is intended by the Mortgagor, at the request and with
the consent of the Mortgagee, as the holder of all of the Outstanding
Notes, to amend and supplement the Underlying Mortgage in the respects
hereinafter set forth; and
WHEREAS, the changes in the Underlying Mortgage which the
Mortgagor and the Mortgagee, as the holder of all of the Outstanding Notes,
desire now to effect make advisable the consolidating and restating of each
of the instruments constituting the Underlying Mortgage in its entirety;
and
WHEREAS, all acts, things, and conditions prescribed by law and
by the articles of incorporation and bylaws of the Mortgagor have been duly
performed and complied with to authorize the execution and delivery of this
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Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
Restated Mortgage, Security Agreement and Financing Statement, and to make
this Restated Mortgage, Security Agreement and Financing Statement an
amendment and supplement to, and a consolidation and restatement of, the
Underlying Mortgage; and
WHEREAS, the Mortgagee is authorized to enter into this Restated
Mortgage, Security Agreement and Financing Statement; and
WHEREAS, it is contemplated that the Outstanding Notes and the
Current Note shall be secured by this Restated Mortgage, Security Agreement
and Financing Statement, and also that any additional notes and refunding,
renewal and substitute notes (hereinafter collectively called the
"Additional Notes") which may from time to time be executed by the
Mortgagor and delivered to the Mortgagee as hereinafter provided, shall be
secured by this Restated Mortgage, Security Agreement and Financing
Statement (the Outstanding Notes, the Current Note and any Additional Notes
being hereinafter collectively called the "notes"); and
WHEREAS, the Mortgagor now owns a telephone system and other
facilities identified in the Property Schedule contained in the Granting
Clause hereof (hereinafter called the "Existing Facilities"); and
WHEREAS, to the extent that any of the property described or
referred to herein and in the Underlying Mortgage is governed by the
provisions of the Uniform Commercial Code of any state (hereinafter called
the "Uniform Commercial Code"), the parties hereto desire that the
Underlying Mortgage and this Restated Mortgage, Security Agreement and
Financing Statement, collectively, be regarded as a "security agreement"
under the Uniform Commercial Code and that this Restated Mortgage, Security
Agreement and Financing Statement be regarded as a "financing statement"
under the Uniform Commercial Code for said security agreement.
NOW, THEREFORE, this Restated Mortgage, Security Agreement and
Financing Statement
WITNESSETH
That each of the instruments constituting the Underlying Mortgage
is hereby amended, supplemented, consolidated and restated to read in its
entirety from and after the date of execution of this Restated Mortgage,
Security Agreement and Financing Statement (the Underlying Mortgage, as
amended, supplemented, consolidated and restated by this Restated Mortgage,
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Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
Security Agreement and Financing Statement, being herein called "this
Mortgage") as follows:
GRANTING CLAUSE
In order to secure the payment of the principal of and interest
on the notes, according to their tenor and effect, and further to secure
the due performance of the covenants, agreements and provisions contained
in this Mortgage and the Consolidated Loan Agreement and to declare the
terms and conditions upon which the notes are to be secured, the Mortgagor,
in consideration of the premises, has executed and delivered this Mortgage,
and has granted, bargained, sold, conveyed, warranted, assigned,
transferred, mortgaged, pledged, and set over, and by these presents does
hereby grant, bargain, sell, convey, warrant, assign, transfer, mortgage,
pledge and set over, unto the Mortgagee, and assigns, all and singular the
following-described property (hereinafter sometimes called the "Mortgaged
Property"):
I
All right, title and interest of the Mortgagor in and to the
Existing Facilities and buildings, plants, works, improvements, structures,
estates, grants, franchises, easements, rights, privileges and properties
real, personal and mixed, tangible or intangible, of every kind or
description, now owned by the Mortgagor or which may hereafter be owned,
constructed or acquired by the Mortgagor, wherever located, and in and to
all extensions and improvements thereof and additions thereto, including
all buildings, plants, works, structures, improvements, fixtures,
apparatus, materials, supplies, machinery, tools, implements, poles, posts,
crossarms, conduits, ducts, lines, whether underground or overhead or
otherwise, wires, cables, exchanges, switches, desks, testboards, frames,
racks, motors, generators, batteries and other items of central office
equipment, subscriber station equipment, including house wiring and
protectors, instruments, connections and appliances, office furniture and
equipment, work equipment and any and all other property of every kind,
nature and description, used, useful or acquired for use by the Mortgagor
in connection therewith and including, without limitation, the property
described in the following property schedule:
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Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
PROPERTY SCHEDULE
(a) The Existing Facilities are located in the following
Counties:
Clay, Lincoln, Turner, Union and Yankton
in the State of South Dakota
(b) The property referred to in the last line of paragraph I of
the Granting Clause includes the following described real estate:
CLAY COUNTY
1. A tract of land described as Lots Eleven (11) and Twelve (12), of
Block Eight (8) of the original town of Irene, in Clay County in
a deed dated July 10, 1967 by ▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇▇▇, his wife,
grantor to the mortgagor, as grantee and recorded on July 11,
1967 in the office of the Register of Deeds of Clay County in the
State of South Dakota in deed book 48, page 327.
2. A tract of land described as Lot "C" of Lot Two (2), in the
Northeast one-quarter (NE1/4) of Section Six (6), Township
Ninety-five (95), North of Range Fifty-three (53) West of the 5th
P.M. of Clay County, South Dakota in a deed dated September 16,
1974, by ▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, his wife, as grantor
to the Mortgagor, as grantee and recorded on September 18, 1974,
in the office of the Register of Deeds of Clay County in the
State of South Dakota, indeed book 54, page 298.
3. A tract of land described as Lot Fourteen (14), of Block Seven
(7), being a part of Outlot "C" of the town of Wakonda, County of
Clay, South Dakota in a deed dated August 25, 1953, by ▇▇▇▇▇
▇▇▇▇▇▇, a single person, as grantor to the Mortgagor, as grantee
and recorded on October 20, 1953, in the office of the Register
of Deeds of Clay County in the State of South Dakota in deed book
43, page 295.
LINCOLN COUNTY
1. A tract of land described as Lot D-C in the Northwest quarter
(NW1/4) of Section Thirty-three (33), Township Ninety-six (96),
Range Fifty (50), West of 5th P.M., Lincoln County, South Dakota,
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in a deed dated August 25, 1964, by the American Lutheran Church,
as grantor to the Mortgagor, as grantee, and recorded on
October 13, 1964, in the office of the Register of Deeds of
Lincoln County, in the State of South Dakota in deed book 72,
page 47.
2. A tract of land described as Lot Fifteen (15) in Block Eleven
(11), of the original plot of the city of Lennox, South Dakota,
in a deed dated July 26, 1956, by ▇▇▇▇ ▇. ▇▇▇▇▇, as grantor to
the Mortgagor, as grantee and recorded on July 30, 1956, in the
office of the Register of Deeds of Lincoln County, in the State
of South Dakota in deed book 64, page 243.
3. A tract of land described as Lot Sixteen (16) and the West
ninety-two (92) feet of Lots Seventeen (17) and Eighteen (18),
all in Block Eight (8) of the original town of Worthing, Lincoln
County, South Dakota in a deed book dated August 3, 1973, by
▇▇▇▇▇ ▇▇▇▇▇▇▇, a widow, as grantor to the Mortgagor, as grantee
and recorded on August 22, 1973, in the office of the Register of
Deeds of Lincoln County, in the State of South Dakota in deed
book 79, page 460.
4. A tract of land described as Lots One (1) and Two (2), of Block
Five (5) being a part of Tracts 1A and 1B in Industrial Tract
No. 1, city of Lennox, Lincoln County, South Dakota, in a deed
dated March 24, 1982, by the Lennox Area Development Corporation,
a corporation, as grantor to the Mortgagor, as grantee, and
recorded March 25, 1982 in the office of the Register of Deeds of
Lincoln County, in the State of South Dakota in deed book 88,
page 202.
▇▇▇▇▇▇ COUNTY
1. A tract of land described as the West half (W1/2) of Lots
Thirteen (13) and Fourteen (14), of Block One (1) of original
(Plot of) the town of Chancellor, South Dakota, being a part of
the Northeast one-quarter (NE1/4) of Section Twenty-eight (28),
Township 99, Range 52, ▇▇▇▇▇▇ County South Dakota in a deed dated
August 15, 1956, by C. T. ▇▇▇▇▇▇, as grantor to the Mortgagor, as
grantee and recorded on August 16, 1956, in the office of
Register of Deeds of ▇▇▇▇▇▇ County in the State of South Dakota
in deed book 79, page 235.
2. A tract of land described as Lots Twenty-five (25), Twenty-six
(26), and Twenty-seven (27), Block (7), original town of ▇▇▇▇▇,
being a part of the West One-half (W1/2), Southeast One-quarter
(SE1/4), of Section Thirty-three (33), Township 98, Range 52,
▇▇▇▇▇▇ County, South Dakota in a deed dated March 23, 1953, by
Dakota State Telephone Company (a corporation), as grantor to the
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Mortgagor, as grantee and recorded on September 1, 1953, in the
office of the Register of Deeds of ▇▇▇▇▇▇ County in the State of
South Dakota in deed book 78, pages 57, 58, 59 and 60.
3. A tract of land described as Outlot "A" of the Southeast One-
quarter (SE1/4) of the Southeast One-quarter (SE1/4), of Section
Twenty-three (23), Township Ninety-seven (97), North, Range
Fifty-five (55), West of the 5th P.M., ▇▇▇▇▇▇ County, South
Dakota in a deed dated July 9, 1954, by ▇▇▇▇ ▇▇▇▇▇▇▇▇, a widower,
as grantor to the Mortgagor, as grantee and recorded July 12,
1954 in the office of the Register of Deeds in ▇▇▇▇▇▇ County in
the State of South Dakota in deed book 77, page 469.
4. A tract of land described as the North Eighty (80') feet of Lots
Eight (8) and Nine (9), Block Twenty-three (23), of the original
town, city of ▇▇▇▇▇▇, South Dakota, being a part of the Northeast
One-quarter (NE1/4) of Section Twenty-seven (27), Township 98,
Range 53, ▇▇▇▇▇▇ County, South Dakota in a deed dated November
14, 1968 by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, his wife, as
grantors to the Mortgagor, as grantee and recorded November 15,
1968 in the office of the Register of Deeds, ▇▇▇▇▇▇ County in the
State of South Dakota in deed book 84, page 40.
5. A tract of land described as Lot Ten (10), of Block Twenty-three
(23), of the original Plot of the town of Hurley, South Dakota,
being a part of the Northeast One-quarter (NE1/4) of Section
Twenty-seven (27), Township 98, Range 53, ▇▇▇▇▇▇ County, South
Dakota in a deed dated January 3, 1961, by ▇▇▇▇▇▇▇▇ ▇. and
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, his wife, as grantors to the Mortgagor, as
grantee and recorded January 4, 1961 in the office of the
Register of Deeds, ▇▇▇▇▇▇ County in the State of South Dakota in
deed book 80, page 421.
6. A tract of land described as the North Thirty-six (36') feet of
Lots Nineteen (19) and Twenty (20), Block Six (6), original town
of Irene, being a part of the Southwest One-quarter (SW1/4) of
Section Thirty-one (31), Township 96, Range 53, ▇▇▇▇▇▇ County,
South Dakota, in a deed dated June 17, 1954, by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
and ▇▇▇▇ ▇▇▇▇▇▇▇▇, his wife, as grantors to the Mortgagor, as
grantee and recorded June 19, 1954, in the office of the Register
of Deeds, ▇▇▇▇▇▇ County in the State of South Dakota in deed
book 77, page 454.
7. A tract of land described as Lots Ten (10), Eleven (11), Twelve
(12) and Thirteen (13), all in Block One (1) of the town of
Monroe (formerly the town of Warrington) in the Northeast One-
quarter (NE1/4) of Section Fifteen (15), Township 100, Range 54,
West of the 5th P.M., County of ▇▇▇▇▇▇, South Dakota in a deed
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dated August 4, 1953 by ▇▇▇▇▇▇ County as grantor to the
Mortgagor, as grantee and recorded August 10, 1953 in the office
of the Register of Deeds, ▇▇▇▇▇▇ County in the State of South
Dakota in deed book 78, page 54.
▇▇▇▇▇▇ COUNTY
8. A tract of land described as Lot Fifteen (15), Block Four (4), of
the original (Plot) of the town, now the city of ▇▇▇▇▇▇, South
Dakota, being a part of the Northeast One-quarter (NE1/4) of
Section Seventeen (17), Township 99, Range 53, ▇▇▇▇▇▇ County in
the State of South Dakota in a deed dated June 13, 1956, by
▇▇▇▇▇▇▇ ▇. Koloyjian, ▇▇▇▇▇▇ ▇. Koloyjian, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ as grantors to the Mortgagor, as grantee
and recorded July 25, 1956, in the office of the Register of
Deeds, ▇▇▇▇▇▇ County in the State of South Dakota in deed
book 78, page 141.
UNION COUNTY
1. A tract of land described as commencing at a point One hundred
fifty-seven (157') feet North of the Southwest corner of the
Northwest One-quarter (NW1/4) of Section Eighteen (18),
Township 94 North, Range 50, West of the 5th P.M., in Union
County, South Dakota, thence North Sixty-six (66') feet, thence
East Fifteen (15) rods, then South Sixty-six (66') feet, thence
West Fifteen (15) rods to place of beginning in Union County,
South Dakota, according to the Government Survey thereof. Said
real estate is also described as the North Sixty-six (66') feet
of the South Two-hundred twenty-three (223') feet of West Fifteen
(15) rods of the Northeast One-quarter (NE1/4) of Section
Eighteen (18), Township 94 North, Range 50 West of the 5th P.M.,
Union County, South Dakota in a deed dated January 7, 1971, by
the Alsen Community Telephone Company, (a corporation), as
grantor to the Mortgagor, as grantee, and recorded on March 4,
1971, in both offices of the Register of Deeds Union and Clay
counties in the State of South Dakota in the Union County deed
book 61, page 58, and the Clay County deed book 51, pages 61-65.
YANKTON COUNTY
1. A tract of land described as the East Forty-feet (40') of the
South Thirty-feet (30') of ▇▇▇ ▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇, situated on the Southeast One-quarter (SE1/4) of
the Northwest One-quarter (NW1/4) of Section Twelve (12),
Township 98, Range 54, Yankton County South Dakota in a deed
dated October 31, 1973, by Northwestern ▇▇▇▇ Telephone Company (a
Corporation), as grantor to the Mortgagor, as grantee and
recorded November 12, 1973 in the office of the Register of
Deeds, Yankton County in the State of South Dakota in deed
book 259, page 140.
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2. A tract of land described as Outlot "A" of the Northeast One-
quarter (NE1/4) of Section Twenty-seven (27), Township Ninety-six
(96) North, Range Fifty-five (55), West of the 5th P.M. in
Yankton County, South Dakota, in a deed dated July 3, 1954, by
▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, his wife, as grantors to the
Mortgagor, as grantee and recorded July 7, 1954 in the office of
the Register of Deeds, Yankton County in the State of South
Dakota in deed book 205, page 193.
3. A tract of land described as Lots Seventeen (17) and eighteen
(18) in Block Eight (8) of Volin Addition, town of ▇▇▇▇▇, Yankton
County, South Dakota in deeds dated July 24, 1954 and August 2,
1954 and August 24, 1954, by ▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇, his
wife, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (also known as ▇▇▇▇▇▇▇▇▇), ▇▇▇▇▇ ▇▇▇▇▇▇,
formerly ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (also known as ▇▇▇▇▇▇▇▇▇), ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ (also known as ▇▇▇▇▇▇▇▇▇) (also known as ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇), ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Hove (also known as ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Hove), ▇▇▇▇▇ ▇. ▇▇▇▇▇ (also known as ▇.▇. ▇▇▇▇▇) and ▇▇▇▇ ▇▇▇▇▇▇,
as grantors to the Mortgagor, as grantee and all deeds recorded
August 30, 1954 in the office of the Register of Deeds, Yankton
County in the State of South Dakota in deed book and page as
follows:
GRANTOR DEED BOOK PAGE
▇▇▇▇ ▇. and ▇▇▇▇▇ ▇▇▇▇▇ 199 89
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 199 90
▇▇▇▇▇ ▇▇▇▇▇▇ 199 ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 199 93
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Hove 199 91
▇▇▇▇▇ ▇. ▇▇▇▇▇ 199 88
▇▇▇▇ ▇▇▇▇▇▇ 206 141
TOGETHER WITH all plants, works, structures, erections, reservoirs,
dams, buildings, fixtures and improvements now or hereafter located on
any of the properties conveyed by any and all of the aforesaid deeds
mentioned above, and all tenements, hereditaments and appurtenances
now or hereafter thereunto belonging or in any wise appertaining.
The description of each of the properties conveyed by and through the
provisions of the aforesaid deeds is by reference made a part hereof
as though fully set forth at length herein.
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Form - Restated Mortgage - Telephone 1/85
100% REA Loan - No Prior Bank Loan
6-5452
II
All right, title and interest of the Mortgagor in, to and under
any and all grants, privileges, rights of way and easements now owned, held,
leased, enjoyed or exercised, or which may hereafter be owned, held,
leased, acquired, enjoyed or exercised, by the Mortgagor for the purposes
of, or in connection with, the construction or operation by or on behalf of
the Mortgagor of telephone properties, facilities, systems or businesses,
whether underground or overhead or otherwise, wherever located;
III
All right, title and interest of the Mortgagor in, to and under
any and all licenses, franchises, ordinances, privileges and permits
heretofore granted, issued or executed, or which may hereafter be granted,
issued or executed, to it or to its assignors by the United States of
America, or by any state, or by any county, township, municipality, village
or other political subdivision thereof, or by any agency, board, commission
or department of any of the foregoing, authorizing the construction,
acquisition, or operation of telephone properties, facilities, systems or
businesses, insofar as the same may by law be assigned, granted, bargained,
sold, conveyed, transferred, mortgaged, or pledged;
IV
All right, title and interest of the Mortgagor in, to and under
any and all contracts heretofore or hereafter executed by and between the
Mortgagor and any person, firm, or corporation relating to the Mortgaged
Property together with any and all other accounts, contract rights and
general intangibles (as such terms are defined in the applicable Uniform
Commercial Code) heretofore or hereafter acquired by the Mortgagor;
V
Also, all right, title and interest of the Mortgagor in and to
all other property, real or personal, tangible or intangible, of every
kind, nature and description, and wheresoever situated, now owned or
hereafter acquired by the Mortgagor, it being the intention hereof that all
such property now owned but not specifically described herein or acquired
or held by the Mortgagor after the date hereof shall be as fully embraced
within and subjected to the lien hereof as if the same were now owned by
the Mortgagor and were specifically described herein to the extent only,
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however, that the subjection of such property to the lien hereof shall not
be contrary to law;
Together with all rents, income, revenues, profits and benefits
at any time derived, received or had from any and all of the above-described
property of the Mortgagor.
Provided, however, that except as hereinafter provided in
Section 12(b) of Article II hereof, no automobiles, trucks, trailers,
tractors or other vehicles (including without limitation aircraft or ships,
if any) owned or used by the Mortgagor shall be included in the Mortgaged
Property.
TO HAVE AND TO HOLD all and singular the Mortgaged Property unto
the Mortgagee and its assigns forever, to secure equally and ratably the
payment of the principal of and interest on the notes, according to their
tenor and effect, without preference, priority or distinction as to
interest or principal (except as otherwise specifically provided herein) or
as to lien or otherwise of any note over any other note by reason of the
priority in time of the execution, delivery or maturity thereof or of the
assignment or negotiation thereof, or otherwise, and to secure the due
performance of the covenants, agreements and provisions herein and in the
Consolidated Loan Agreement contained, and for the uses and purposes and
upon the terms, conditions, provisos and agreements hereinafter expressed
and declared.
ARTICLE I
ADDITIONAL NOTES
SECTION 1. The Mortgagor, when authorized by resolution or
resolutions of its board of directors, may from time to time execute and
deliver to the Government one or more Additional Notes to evidence
(1) loans made by the Government to the Mortgagor pursuant to the Act;
(2) indebtedness of the Mortgagor incurred by the assumption by the
Mortgagor of the indebtedness of a third party or parties to the Government
created by a loan or loans theretofore made by the Government to such third
party or parties pursuant to the Act; or (3) obligations of the Mortgagor
to the Government on account of a guarantee or guarantees made by the
Government pursuant to the Act of the repayment of a loan or loans made by
a legally organized lending agency or agencies to the Mortgagor. The
Mortgagor, when authorized by resolution or resolutions of its board of
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directors, may also from time to time execute and deliver one or more
Additional Notes to refund any note or notes at the time outstanding and
secured hereby, or in renewal of, or in substitution for, any such
outstanding note or notes. Additional Notes shall contain such provisions
and shall be executed and delivered upon such terms and conditions as the
board of directors of the Mortgagor in the resolution or resolutions
authorizing the execution and delivery thereof and the Government shall
prescribe; provided, however, that the outstanding principal balances owing
on the notes shall not at any one time exceed the amount identified in the
Instruments Recital as the Maximum Debt Limit, and no note shall mature
more than fifty (50) years after the date hereof. Additional Notes,
including refunding, renewal and substitute notes, when and as executed and
delivered, shall be secured by this Mortgage, equally and ratably with all
other notes at the time outstanding, without preference, priority, or
distinction of any of the notes over any other of the notes by reason of
the priority of the time of the execution, delivery or maturity thereof or
of the assignment or negotiation thereof. As used in this Mortgage, the
term "directors" includes trustees.
SECTION 2. The Mortgagor, when authorized by resolution or
resolutions of its board of directors, may from time to time execute,
acknowledge, deliver, record and file mortgages supplemental to this
Mortgage which thereafter shall form a part hereof, for the purpose of
formally confirming this Mortgage as security for the notes. Nothing
herein contained shall require the execution and delivery by the Mortgagor
of a supplemental mortgage in connection with the issuance hereunder or the
securing hereby of notes except as hereinafter provided in Section 12 of
Article II hereof.
ARTICLE II
PARTICULAR COVENANTS OF THE MORTGAGOR
The Mortgagor covenants with the Mortgagee and the holders of
notes secured hereby (hereinafter sometimes collectively called the
"noteholders") and each of them as follows:
SECTION 1. The Mortgagor is duly authorized under its articles
of incorporation and by-laws and the laws of the State of its incorporation
and all other applicable provisions of law to execute and deliver the
Outstanding Notes, the Current Note and this Mortgage and to execute and
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deliver Additional Notes; all corporate action on its part for the
execution and delivery of the Outstanding Notes, the Current Note and this
Mortgage has been duly and effectively taken; and the Outstanding Notes,
the Current Note and this Mortgage are the valid and enforceable
obligations of the Mortgagor in accordance with their respective terms.
SECTION 2. The Mortgagor warrants that it has good right and
lawful authority to mortgage the property described in the Granting Clause
of this Mortgage for the purposes herein expressed, and that the said
property is free and clear of any deed of trust, mortgage, lien, charge or
encumbrance thereon or affecting the title thereto, except (i) the lien of
this Mortgage and taxes or assessments not yet due; (ii) deposits or
pledges to secure payment of workmen's compensation, unemployment
insurance, old age pensions or other social security; and (iii) deposits or
pledges to secure performance of bids, tenders, contracts (other than
contracts for the payment of borrowed money), leases, public or statutory
obligations, surety or appeal bonds, or other deposits or pledges for
purposes of like general nature in the ordinary course of business.
The Mortgagor will, so long as any of the notes shall be
outstanding, maintain and preserve the lien of this Mortgage superior to
all other liens affecting the Mortgaged Property, and will forever warrant
and defend the title to the property described as being mortgaged hereby to
the Mortgagee against any and all claims and demands whatsoever. The
Mortgagor will promptly pay or discharge any and all obligations for or on
account of which any such lien or charge might exist or could be created
and any and all lawful taxes, rates, levies, assessments, liens, claims or
other charges imposed upon or accruing upon any of the Mortgagor's property
(whether taxed to the Mortgagor or to any noteholder), or the franchises,
earnings or business of the Mortgagor, as and when the same shall become
due and payable; and whenever called upon so to do the Mortgagor will
furnish to the Mortgagee or to any noteholder adequate proof of such
payment or discharge.
SECTION 3. The Mortgagor will duly and punctually pay the
principal of and interest on the notes at the dates and places and in the
manner provided therein, according to the true intent and meaning thereof,
and all other sums becoming due hereunder.
SECTION 4. (a) The Mortgagor will at all times, so long as any
of the notes shall be outstanding, take or cause to be taken all such
action as from time to time may be necessary to preserve its corporate
existence and to preserve and renew all franchises, rights of way,
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easements, permits and licenses now or hereafter to it granted or upon it
conferred, and will comply with all valid laws, ordinances, regulations and
requirements applicable to it or its property. The Mortgagor will not,
without the approval in writing of the holder or holders of not less than a
majority in principal amount of the notes at the time outstanding
(hereinafter called the "majority noteholders"), take or suffer to be taken
any steps to reorganize, or to consolidate with or merge into any other
corporation, or to sell, lease or transfer (or make any agreement therefor)
the Mortgaged Property, or any part thereof.
(b) If this subsection is made applicable by the
Instruments Recital, then nothing herein contained shall prevent any such
reorganization, consolidation or merger provided that the lien and security
of this Mortgage and the rights or powers of the Mortgagee and the
noteholders hereunder shall not thereby be impaired or adversely affected,
and provided that upon such reorganization, consolidation or merger, the
due and punctual payment of the principal of and interest on the notes
according to their tenor and the due and punctual performance of all
covenants and conditions of this Mortgage shall be assumed by the
corporation formed by such reorganization, consolidation or merger, and the
lien of this Mortgage shall remain a superior lien upon the property owned
by the Mortgagor at the time of such reorganization, consolidation or
merger and upon any improvements or additions to such property, either
prior to or subsequent to such reorganization, consolidation or merger.
(c) The Mortgagor may, however, without obtaining the
approval of the holder or holders of any of the notes at the time
outstanding, at any time or from time to time so long as the Mortgagor is
not in default hereunder, sell or otherwise dispose of, free from the lien
hereof, any of its property which is neither necessary to nor useful for
the operation of the Mortgagor's business, or which has become obsolete,
worn out or damaged or otherwise unsuitable for the purposes of the
Mortgagor; provided, however, that the Mortgagor shall: (1) to the extent
necessary, replace the same by, or substitute therefor, other property of
the same kind and nature, which shall be subject to the lien hereof, free
and clear of all prior liens, and apply any proceeds derived from such sale
or other disposition of such property and not needed for the replacement
thereof to the payment of the indebtedness evidenced by the notes; or
(2) immediately upon the receipt of the proceeds of any sale or other
disposition of said property, apply the entire amount of such proceeds to
the payment of the indebtedness evidenced by the notes; or (3) deposit all
or such part of the proceeds derived from the sale or other disposition of
said property as the majority noteholders shall specify in such restricted
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bank accounts as such holder or holders shall designate, and shall use the
same only for such additions to or improvements of the Mortgaged Property
and on such terms and conditions as such holder or holders shall specify.
SECTION 5. The Mortgagor will at all times maintain and preserve
the Mortgaged Property in good repair, working order and condition, and
will from time to time make all needful and proper repairs, renewals, and
replacements, and useful and proper alterations, additions, betterments and
improvements, and will, subject to contingencies beyond its reasonable
control, at all times keep its plant and properties in continuous operation
and use all reasonable diligence to furnish the subscribers served by it
through the Mortgaged Property with adequate telephone service.
SECTION 6. Except as specifically authorized in writing in
advance by the majority noteholders, the Mortgagor will purchase all
materials, equipment, supplies and replacements to be incorporated in or
used in connection with the Mortgaged Property outright, and not subject to
any conditional sales agreement, chattel mortgage, bailment lease, or other
agreement reserving to the seller any right, title or lien.
SECTION 7. (a) The Mortgagor will take out, as the
respective risks are incurred, and maintain the following classes and
amounts of insurance: (1) fidelity bonds covering each officer and
employee of the Mortgagor in not less than the following amounts, based on
the estimated annual gross revenues (including gross toll collected) of the
Mortgaged Property:
ANNUAL GROSS REVENUE AMOUNT OF COVERAGE
Less than $ 200,000 $ 10,000
$200,001 to 400,000 20,000
400,001 to 600,000 40,000
From 600,001 to 800,000 60,000
800,001 to 1,000,000 80,000
over 1,000,000 100,000
and each collection agent of the Mortgagor shall be included in such
fidelity bonds for not less than $2,500, or 10 percent of the highest
amount collected annually by any one collection agent, whichever is
greater; (2) workmen's compensation insurance covering all employees of the
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Mortgagor, in such amounts as may be required by law, or if the Mortgagor
or any of its employees are not subject to the workmen's compensation laws
of the State or States in which the Mortgagor conducts its operations, then
its workmen's compensation policy shall provide voluntary compensation
coverage to the same extent as though the Mortgagor and such employees were
subject to such laws; and including occupational disease liability
coverage, and "additional medical" coverage of not less than $10,000 in
States where full medical coverage is not required by law; (3) public
liability and property damage liability insurance, covering ownership
liability, and all operations of the Mortgagor, with limits for bodily
injury or death of not less than $100,000 for one person and $300,000 for
each accident, and with limits for property damage of not less than $50,000
for each accident and $100,000 aggregate for the policy period;
(4) liability insurance on all motor vehicles, trailers, semitrailers, and
aircraft used in the conduct of the Mortgagor's business, whether owned,
non-owned or hired by the Mortgagor, with bodily injury limits of not less
than $100,000 for one person and $300,000 for each accident, and with
property damage limits of $25,000 for each accident; in connection with
aircraft liability, also passenger bodily injury limits of $100,000 per
person and $300,000 for each accident; (5) comprehensive, or separate fire,
theft and windstorm insurance covering loss of or damage to all owned motor
vehicles, trailers, and aircraft of the Mortgagor, having a unit value in
excess of $1,000, in an amount not less than the actual cash value of the
property insured; and (6) fire and extended coverage insurance, designating
the Government as mortgagee in the policy, on each building, each building
and its contents, and materials, supplies, poles and crossarms, owned by
the Mortgagor, having a value at any one location in excess of $5,000, or
in excess of one percent of the total plant value, whichever is larger, and
in an amount not less than 80 percent of the current cost to replace the
property new, less actual depreciation.
The Mortgagor will also, from time to time, increase or
supplement the classes and amounts of insurance specified above to the
extent required to conform to the accepted practice of the telephone
industry for companies of the size and character of the Mortgagor. The
Mortgagor will, upon request of the majority noteholders, submit to the
noteholder or noteholders designated in such request a schedule of its
insurance in effect on the date specified in such request. If the
Mortgagor shall at any time fail or refuse to take out or maintain
insurance or to make changes in respect thereof upon appropriate request by
such noteholder or noteholders, such noteholder or noteholders may take out
such insurance on behalf and in the name of the Mortgagor, and the
Mortgagor will pay the cost thereof.
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(b) In the event of damage to or the destruction or
loss of any portion of the Mortgaged Property which shall be covered by
insurance, unless the majority noteholders shall otherwise agree, the
Mortgagor shall replace or restore such damaged, destroyed or lost portion
so that the Mortgaged Property shall be in substantially the same condition
as it was in prior to such damage, destruction or loss, and shall apply the
proceeds of the insurance for that purpose. The Mortgagor shall replace
the loss or shall commence such restoration promptly after such damage,
destruction or loss shall have occurred and shall complete such replacement
or restoration as expeditiously as practicable, and shall pay or cause to
be paid out of the proceeds of such insurance all costs and expenses in
connection therewith so that such replacement or restoration shall be so
completed that the portion of the Mortgaged Property so replaced or
restored shall be free and clear of all mechanics' liens and other claims.
(c) Sums recovered under any fidelity bond by the
Mortgagor for a loss of funds advanced under the notes or recovered by a
Mortgagee for any loss under such bond shall, unless otherwise directed by
the Mortgagee, be applied to the prepayment of the notes, PRO RATA
according to the unpaid principal amounts thereof or to construct or
acquire facilities approved by the Mortgagee, which will become part of the
Mortgaged Property.
(d) The foregoing insurance coverage shall be obtained
by means of bond and policy forms approved by regulatory authorities,
including standard REA endorsements and riders used by the insurance
industry to provide coverage for REA borrowers.
SECTION 8. In the event of the failure of the Mortgagor in any
respect to comply with the covenants and conditions herein contained with
respect to the procuring of insurance, the payment of taxes, assessments
and other charges, the keeping of the Mortgaged Property in repair and free
of liens and other claims or to comply with any other covenant contained in
this Mortgage, any noteholder or noteholders shall have the right (without
prejudice to any other rights arising by reason of such default) to advance
or expend moneys for the purpose of procuring such insurance, or for the
payment of insurance premiums, taxes, assessments or other charges, or to
save the Mortgaged Property from sale or forfeiture for any unpaid tax or
assessment, or otherwise, or to redeem the same from any tax or other sale,
or to purchase any tax title thereon, or to remove or purchase any
mechanics' liens or other encumbrance thereon, or to make repairs thereon
or to comply with any other covenant herein contained or to prosecute or
defend any suit in relation to the Mortgaged Property or in any manner to
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protect the Mortgaged Property and the title thereto, and all sums so
advanced for any of the aforesaid purposes within interest thereon at the
highest legal rate but not in excess of twelve per centum (12%) per annum
shall be deemed a charge upon the Mortgaged Property in the same manner as
the notes at the time outstanding are secured and shall be forthwith paid
to the noteholder or noteholders making such advance or advances upon
demand. It shall not be obligatory for any noteholder in making any such
advances or expenditures to inquire into the validity of any such tax
title, or of any of such taxes or assessments or sales therefor, or of any
such mechanics' liens or other encumbrance.
SECTION 9. The Mortgagor will not, without the approval in
writing of the majority noteholders: (a) enter into any contract or
contracts for the operation or maintenance of all or any part of its
property, for the use by others of any of the Mortgaged Property, or for
toll traffic, operator assistance, extended scope or switching services to
be furnished by or for connecting or other companies; provided, however,
that such approval shall not be required for any toll traffic or operator
assistance contract which in form and substance conforms with contracts in
general use in the telephone industry; or (b) deposit any of its funds,
regardless of the source thereof, in any bank which is not insured by the
Federal Deposit Insurance Corporation, or the successor thereof.
SECTION 10. (a) If this subsection is made applicable by the
Instruments Recital, the Mortgagor will not pay its directors or trustees,
as such, any salaries for their services, except such as shall have been
approved by the majority noteholders, provided that nothing herein
contained shall preclude any director or trustee from serving the Mortgagor
in any other capacity and receiving compensation therefor.
(b) Salaries, wages and other compensation paid by the
Mortgagor for services, and directors' or trustees' fees, shall be
reasonable and in conformity with the usual practice of corporations of the
size and nature of the Mortgagor. Except as specifically authorized in
writing in advance by the majority noteholders, the Mortgagor will make no
advance payments or loans, or in any manner extend its credit, either
directly or indirectly, with or without interest, to any of its directors,
trustees, officers, employees, stockholders, members or affiliated
companies. As used in this section, the term "affiliated companies" shall
have the meaning prescribed for this term by the Federal Communications
Commission in its prevailing uniform system of accounts for Class A
telephone companies.
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SECTION 11. The Mortgagor will at all times keep, and safely
preserve, proper books, records and accounts in which full and true entries
will be made of all of the dealings, business and affairs of the Mortgagor,
in accordance with methods of accounting prescribed by the state regulatory
body having jurisdiction over the Mortgagor, or in the absence of such
regulatory body or such prescription, by the Federal Communications
Commission. The Mortgagor will prepare and furnish each noteholder not
later than the thirtieth day of January, April, July and October in each
year, or at less frequent intervals when specified by the majority
noteholders, financial and statistical reports on its condition and
operations. Such reports shall be in such form and include such
information as may be specified by the majority noteholders, including
without limitation an analysis of the Mortgagor's revenues, expenses, and
subscriber accounts. The Mortgagor will cause to be prepared and furnished
to each noteholder at least once during each 12-month period during the
term hereof, a full and complete report of its financial condition as of a
date (hereinafter called the Fiscal Date) not more than 90 days prior to
the date such report is furnished to the noteholders hereunder, and of its
operations for the twelve-month period ended on the fiscal date, in form
and substance satisfactory to the majority noteholders, audited and
certified by independent certified public accountants satisfactory to said
noteholders and accompanied by a report of such audit in form and substance
satisfactory to said noteholders. The majority noteholders, through its or
their representatives, shall at all times during reasonable business hours
have access to, and the right to inspect and make copies of, any or all
books, records and accounts, and any or all invoices, contracts, leases,
payrolls, cancelled checks, statements and other documents and papers of
every kind belonging to or in the possession of the Mortgagor or in anywise
pertaining to its property or business.
SECTION 12. (a) The Mortgagor will from time to time upon
written demand of the majority noteholders make, execute, acknowledge and
deliver or cause to be made, executed, acknowledged and delivered all such
further and supplemental indentures of mortgage, deeds of trust, mortgages,
financing statements, continuation statements, security agreements,
instruments and conveyances as may reasonably be requested by the majority
noteholders and take or cause to be taken all such further action as may
reasonably be requested by the majority noteholders to effectuate the
intention of these presents and to provide for the securing and payment of
the principal of and interest on the notes according to the terms thereof
and for the purpose of fully conveying, transferring and confirming unto
the Mortgagee the property hereby conveyed, mortgaged and pledged, or
intended so to be, whether now owned by the Mortgagor or hereafter acquired
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by it and to reflect the assignment of the rights or interests of the
Mortgagee or of any noteholder hereunder or under any note. The Mortgagor
will cause this Mortgage and any and all supplemental indentures of
mortgage, mortgages and deeds of trust and every security agreement,
financing statement, continuation statement and every additional instrument
which shall be executed pursuant to the foregoing provisions forthwith upon
execution to be recorded and filed and rerecorded and refiled as
conveyances and mortgages and deeds of trust of and security interests in
real and personal property in such manner and in such places as may be
required by law or reasonably requested by the majority noteholders in
order fully to preserve the security for the notes and to perfect and
maintain the superior lien of this Mortgage and all supplemental indentures
of mortgage, mortgages and deeds of trust and the rights and remedies of
the Mortgagee and the noteholders.
(b) In the event that the Mortgagor has had or suffers
a deficit in net income, as determined in accordance with methods of
accounting prescribed in Section 11 of Article II hereof, for any of the
five fiscal years immediately preceding the date hereof or for any fiscal
year while any of the notes are outstanding, the Mortgagor will at any time
or times upon written demand of the majority noteholders make, execute,
acknowledge and deliver or cause to be made, executed, acknowledged and
delivered all such further and supplemental indentures of mortgage,
mortgages, security agreements, financing statements, instruments and
conveyances, and take or cause to be taken all such further action, as may
reasonably be requested by the majority noteholders in order to include in
this Mortgage, as Mortgaged Property, and to subject to all the terms and
conditions of this Mortgage, all right, title and interest of the Mortgagor
in and to, all and singular, the automobiles, trucks, trailers, tractors,
aircraft, ships and other vehicles then owned by the Mortgagor, or which
may thereafter be owned or acquired by the Mortgagor. From and after the
time of such written demand of the majority noteholders such vehicles shall
be deemed to be part of the Mortgaged Property for all purposes hereof.
SECTION 13. Any noteholder may, at any time or times in
succession without notice to or the consent of the Mortgagor or any other
noteholder and upon such terms as such noteholder may prescribe, grant to
any person, firm or corporation who shall have become obligated to pay all
or any part of the principal of or interest on any note held by or
indebtedness owed to such noteholder or who may be affected by the lien
hereby created, an extension of the time for the payment of such principal
or interest, and after any such extension the Mortgagor will remain liable
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for the payment of such note or indebtedness to the same extent as though
it had at the time of such extension consented thereto in writing.
SECTION 14. The Mortgagor, subject to applicable laws and rules,
and regulations and orders of regulatory bodies, will charge for telephone
service furnished by its rates which shall yield revenues at least
sufficient to enable the Mortgagor to pay and discharge all taxes and
expenses when due, and also to make any payment in respect of principal of
and interest on the notes when and as the same shall become due. The
Mortgagor will, not less than ninety (90) days prior to the effective date
of any proposed change in its rate, give to the holder or holders of the
notes at the time outstanding written notice of such proposed change and a
copy of a schedule showing the then existing rates and the proposed changes
therein.
SECTION 15. (a) Except as specifically authorized in writing in
advance by the majority noteholders, the Mortgagor will not declare or pay
any dividends on its capital stock, membership certificates or equity
capital certificates (other than in shares of such capital stock or in such
certificates), or make any other distribution to its stockholders, members
or subscribers, or purchase, redeem or retire any of its capital stock,
membership certificates or equity capital certificates, or make any
investment in affiliated companies, unless after such action the
Mortgagor's current assets will equal or exceed its current liabilities
(exclusive of current liabilities incurred for additions to plant), and the
Mortgagor's adjusted net worth will be at least forty per centum (40%) of
its adjusted assets, or the sum of the following (whichever is the smaller
amount):
(1) the percentage of its adjusted assets specified in the
Instruments Recital, plus
(2) thirty per centum (30%) of its adjusted net worth, if
any, in excess of the amount represented by the
percentage of adjusted assets set out in the
immediately preceding subparagraph (1), plus
(3) thirty per centum (30%) of the amount of any reduction
of its adjusted net worth after the date specified in
the Instruments Recital, resulting from the declaration
or payment of dividends or distributions, the purchase,
redemption or retirement of its capital stock,
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membership certificates or equity capital certificates
or investments in affiliated companies.
(b) During such time or times as the Mortgagor's
adjusted net worth is less than the percentage of its adjusted assets
specified in the Instruments Recital:
(1) the Mortgagor will make no increase, without prior written
approval of the majority noteholders, in salaries, wages, fees
and other compensation paid to officers, directors, trustees,
executives, or supervisors of the Mortgagor, or to other
employees having either a substantial ownership interest in the
Mortgagor, or a close family relationship with officers,
directors, trustees, executives, supervisors, or holders of
substantial ownership interests in the Mortgagor; and
(2) the Mortgagor will promptly furnish the majority noteholders with
certified copies of the minutes of all meetings of its
stockholders, members, directors or trustees; and
(3) if the operation of the Mortgaged Property for the preceding
calendar year resulted in a decrease in the Mortgagor's earned
surplus accounts, the Mortgagor will, upon request in writing of
the majority noteholders, take all required action to increase
its charges for telephone service or to execute a plan for
reducing expenses, such increase in charges and such plan to be
submitted to all the noteholders and to be acceptable to and
approved in writing by the majority noteholders.
(c) During such time or times as the Mortgagor's
adjusted net worth is less than twenty per centum (20%) of its adjusted
assets:
(1) the Mortgagor will promptly furnish the noteholders with a
detailed report on ownership or transfers of its capital stock,
membership certificates or equity capital certificates whenever
requested in writing by the majority noteholders, or whenever one
per centum (1%) or more of its outstanding ownership interests
has been transferred since the last preceding report to such
noteholders on ownership interests or transfers; and
(2) whenever any change in ownership interests in the Mortgagor
occurs which in the sole opinion of the majority noteholders
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might adversely affect its or their security, the Mortgagor will,
upon request in writing of the majority noteholders:
(a) increase its adjusted net worth, within one year of
such written request, to the level requested by the
majority noteholders, up to twenty per centum (20%) of
its adjusted assets; and
(b) take no action which would result in reducing its
adjusted net worth thereafter below the sum of (i) the
amount representing the level of net worth requested by
the majority noteholders pursuant to subparagraph (c)
(2) (a) above, plus (ii) thirty per centum (30%) of its
adjusted net worth, if any, in excess of the level of
net worth referred to in the immediately preceding
subclause (i), plus (iii) thirty per centum (30%) of
the amount of any reduction of its adjusted net worth
after the date of such request by the majority
noteholders, resulting from the declaration or payment
of dividends or distributions, the purchase, redemption
or retirement of its capital stock, membership
certificates or equity capital certificates, or
investments in affiliated companies.
(d) As used in this Section 15, the following terms
shall have these meanings:
(1) The term "adjusted net worth" means the sum of the Mortgagor's
"Stock," "Other Capital Surplus" and "Earned Surplus" accounts,
less "adjustments."
(2) The term "adjusted assets" means the sum of the Mortgagor's
accounts classified as "Investments," "Current Assets," "Other
Assets," and "Prepaid Accounts and Deferred Charges," plus an
amount equal to the amount of loan funds still to be advanced
under the Consolidated Loan Agreement, if such amount has not
been recorded as "Subscriptions to Funded Debt," less the sum of
the "Depreciation Resreve," and "Amortization Reserve" accounts
and "adjustments."
(3) The term "adjustments" used in the foregoing definitions means
the sum of the following: "Investments in Affiliated Companies,"
"Advances to Affiliated Companies," "Telephone Plant Acquisition
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Adjustment" debit amounts in excess of "Amortization Reserve,"
"Telephone Plant Adjustment" debit balances, "Company Securities
Owned," unpaid "Subscriptions to Capital Stock," and "Discount on
Capital Stock."
(4) Titles of accounts or groups of accounts and other terms
describing accounting transactions, used in the foregoing
definitions or in this section 15, shall have the meanings
prescribed for them by the Federal Communications Commission in
its prevailing uniform system of accounts for Class A telephone
companies. These terms shall also apply to accounts or groups of
accounts, of the Mortgagor, regardless of the account title or
the system of accounts used, if such accounts have substantially
the same meaning as terms referred to in such uniform system of
accounts.
SECTION 16. In the event that the Mortgaged Property, or any
part thereof, shall be taken under the power of eminent domain, all
proceeds and avails therefrom, except to the extent that all noteholders
shall consent to other use and application thereof by the Mortgagor, shall
forthwith be applied by the Mortgagor: first, to the ratable payment of
any indebtedness by this Mortgage secured other than principal of or
interest on the notes; second, to the ratable payment of interest which
shall have accrued on the notes and be unpaid; third, to the ratable
payment of or on account of the unpaid principal of the notes; and fourth,
the balance shall be paid to whosoever shall be entitled thereto.
SECTION 17. The Mortgagor will well and truly observe and
perform all of the covenants, agreements, terms and conditions contained in
the Consolidated Loan Agreement, on its part to be observed or performed.
SECTION 18. If this section is made applicable by the
Instruments Recital, then: (a) The Mortgagor will not at any time employ,
or enter into any contract for the employment of, any manager of its
telephone properties, unless such employment or such contract shall first
have been approved by the majority noteholders. (b) If, during such
periods as the Mortgagor shall be in default in the making of a payment or
payments of principal of or interest on one or more of the notes, the
majority noteholders shall give notice to the Mortgagor that in their
opinion its telephone properties are not being efficiently operated, and
shall request the termination of the employment of any such manager, or
shall request the termination of any operating contract in respect of any
such telephone properties, the Mortgagor will terminate such employment or
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operating contract within thirty (30) days after the date of such notice.
(c) All contracts in respect of the employment of any such manager or for
the operation of such telephone properties shall contain provisions to
permit compliance with the foregoing covenants.
SECTION 19. At all times when any note is held by the
Government, or in the event the Government shall assign a note without
having insured the payment of such note, this Mortgage shall secure payment
of such note for the benefit of the Government or such uninsured holder
thereof, as the case may be. Whenever any note may be sold to an insured
purchaser, it shall continue to be considered a "note" as defined herein,
but as to any such insured note, the Government, and not such insured
purchaser, shall be considered to be, and shall have the rights of, the
noteholder for purposes of this Mortgage. Notice of the rights of the
Government under the preceding sentence shall be set forth in all such
insured notes. As to any note which may evidence the obligations of the
Mortgagor to the Government on account of a guarantee or guarantees made by
the Government pursuant to the Act of the repayment of a loan or loans made
by a legally organized lending agency or agencies to the Mortgagor, the
Government, and not such legally organized lending agency or agencies,
shall be considered to be, and shall have the rights of, the noteholder for
purposes of this Mortgage.
ARTICLE III
REMEDIES OF THE MORTGAGEE AND NOTEHOLDERS
SECTION 1. If one or more of the following events (hereinafter
called "events of default") shall happen, that is to say:
(a) default shall be made in the payment of any installment of
or on account of interest on or principal of any note or notes when
and as the same shall be required to be made and such default shall
continue for thirty (30) days;
(b) default shall be made in the due observance or performance
of any other of the representations, warranties, covenants, conditions
or agreements on the part of the Mortgagor in any of the notes or in
this Mortgage or in the Consolidated Loan Agreement contained; and
such default shall continue for a period of thirty (30) days after
written notice specifying such default and requiring the same to be
remedied shall have been given to the Mortgagor by any noteholder;
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(c) the Mortgagor shall file a petition in bankruptcy or be
adjudicated a bankrupt or insolvent, or shall make an assignment for
the benefit of its creditors, or shall consent to the appointment of a
receiver of itself or of its property, or shall institute proceedings
for its reorganization or proceedings instituted by others for its
reorganization shall not be dismissed within thirty (30) days after
the institution thereof;
(d) a receiver or liquidator of the Mortgagor or of any
substantial portion of its property shall be appointed and the order
appointing such receiver or liquidator shall not be vacated within
thirty (30) days after the entry thereof;
(e) the Mortgagor shall forfeit or otherwise be deprived of its
corporate charter or franchises, permits or licenses required to carry
on any material portion of its business;
(f) a final judgment shall be entered against the Mortgagor and
shall remain unsatisfied or without a stay in respect thereof for a
period of thirty (30) days; or
then in each and every such case any noteholder may, by notice in writing
to the Mortgagor and delivery of a copy thereof to the other noteholders,
declare all unpaid principal of and accrued interest on any or all notes
held by such noteholder to be due and payable immediately; and upon any
such declaration all such unpaid principal and accrued interest so declared
to be due and payable shall become and be due and payable, immediately,
anything contained herein or in any note or notes to be the contrary
notwithstanding; provided, however, that if at any time after the unpaid
principal of and accrued interest on any of the notes shall have been so
declared to be due and payable, all payments in respect of principal and
interest which shall have become due and payable by the terms of such note
or notes shall be paid to the respective noteholders, and all other
defaults hereunder and under the notes shall have been made good or secured
to the satisfaction of all of the noteholders, then and in every such case,
the noteholder or noteholders who shall have declared the principal of and
interest on notes held by such noteholder or noteholders to be due and
payable may, by written notice to the Mortgagor and delivery of a copy
thereof to the other noteholders, annul such declaration or declarations
and waive such default or defaults and the consequences thereof, but no
such waiver shall extend to or affect any subsequent default or impair any
right consequent thereon.
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SECTION 2. If one or more of the events of default shall happen,
the majority noteholders, for itself or themselves, and as the agent or
agents of the other noteholders, personally or by attorney, in its or their
discretion, may, insofar as not prohibited by law:
(a) take immediate possession of the Mortgaged Property, collect
and receive all credits, outstanding accounts and bills receivable of
the Mortgagor and all rents, income, revenues and profits pertaining
to or arising from the Mortgaged Property, or any part thereof, and
issue binding receipts therefor; and manage, control and operate the
Mortgaged Property as fully as the Mortgagor might do if in possession
thereof, including, without limitation, the making of all repairs or
replacements deemed necessary or advisable;
(b) proceed to protect and enforce the rights of the Mortgagee
and the rights of the noteholder or noteholders under this Mortgage by
suits or actions in equity or at law in any court or courts of
competent jurisdiction, whether for specific performance of any
covenant or any agreement contained herein or in aid of the execution
of any power herein granted or for the foreclosure hereof or hereunder
or for the sale of the Mortgaged Property, or any part thereof, or to
collect the debts hereby secured or for the enforcement of such other
or additional appropriate legal or equitable remedies as may be deemed
most effectual to protect and enforce the rights and remedies herein
granted or conferred, and in the event of the institution of any such
action or suit the noteholder or noteholders instituting such action
or suit shall have the right to have appointed a receiver of the
Mortgaged Property and of all rents, income, revenues and profits
pertaining thereto or arising therefrom derived, received or had from
the time of the commencement of such suit or action, and such receiver
shall have all the usual powers and duties of receivers, in like and
similar cases, to the fullest extent permitted by law, and if
application shall be made for the appointment of a receiver the
Mortgagor hereby expressly consents that the court to which such
application shall be made may make said appointment; and
(c) sell or cause to be sold all and singular the Mortgaged
Property or any part thereof, and all right, title, interest, claim
and demand of the Mortgagor therein or thereto, at public auction at
such place in any county in which the property to be sold, or any part
thereof is located, at such time and upon such terms as may be
specified in a notice of sale, which shall state the time when and the
place were the sale is to be held, shall contain a brief general
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description of the property to be sold, and shall be given by mailing
a copy thereof to the Mortgagor at least fifteen (15) days prior to
the date fixed for such sale and by publishing the same once in each
week for two successive calendar weeks prior to the date of such sale
in a newspaper of general circulation published in said county, or if
no such newspaper is published in such county, in a newspaper of
general circulation in such county, the first such publication to be
not less than fifteen (15) days nor more than thirty (30) days prior
to the date fixed for such sale. Any sale to be made under this
subparagraph (c) of this section 2 may be adjourned from time to time
by announcement at the time and place appointed for such sale or for
such adjourned sale or sales, and without further notice or
publication the sale may be had at the time and place to which the
same shall be adjourned, provided, however, that in the event another
or different notice of sale or another or different manner of
conducting the same shall be required by law the notice of sale shall
be given or the sale shall be conducted, as the case may be, in
accordance with the applicable provisions of law.
SECTION 3. If, within thirty (30) days after the majority
noteholders shall have had knowledge of the happening of an event or events
of default, such noteholder or noteholders shall not have proceeded to
exercise the rights or to enforce the remedies herein or by law conferred
upon or reserved to the Mortgagee or to the noteholders, then, and only
then, any noteholder, for itself and as the agent of the other noteholders,
may proceed forthwith to exercise such rights and to enforce such remedies.
Nothing herein contained shall, however, affect or impair the right, which
is absolute and unconditional, of any holder of any note which may be
secured hereby to enforce the payment of the principal of or interest on
such note on the date or dates any such interest or principal shall become
due and payable in accordance with the terms of such note.
SECTION 4. At any sale hereunder any noteholder or noteholders
shall have the right to bid for and purchase the Mortgaged Property, or
such part thereof as shall be offered for sale, and any noteholder or
noteholders may apply in settlement of the purchase price of the property
so purchased the portion of the net proceeds of such sale which would be
applicable to the payment on account of the principal of and interest on
the note or notes held by such noteholder or noteholders, and such amount
so applied shall be credited as a payment on account of principal of and
interest on the note or notes held by such noteholder or noteholders.
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SECTION 5. Any proceeds or funds arising from the exercise of
any rights or the enforcement of any remedies herein provided after the
payment or provision for the payment of any and all costs and expenses in
connection with the exercise of such rights or the enforcement of such
remedies shall be applied first, to the payment of indebtedness hereby
secured other than the principal of or interest on the notes; second, to
the ratable payment of interest which shall have accrued on the notes and
which shall be unpaid; third, to the ratable payment of or on account of
the unpaid principal of the notes; and the balance, if any, shall be paid
to whosoever shall be entitled thereto.
SECTION 6. The Mortgagor covenants that it will give immediate
written notice to the Mortgagee and to all of the noteholders of the
occurrence of an event of default.
SECTION 7. Every right or remedy herein conferred upon or
reserved to the Mortgagee or to the noteholders shall be cumulative and
shall be in addition to every other right and remedy given hereunder or now
or hereafter existing at law, or in equity, or by statute. The pursuit of
any right or remedy shall not be construed as an election.
SECTION 8. The Mortgagor, for itself and all who may claim
through or under it, covenants that it will not at any time insist upon or
plead, or in any manner whatever claim, or take the benefit or advantage
of, any appraisement, valuation, stay, extension or redemption laws nor or
hereafter in force in any locality where any of the Mortgaged Property may
be situated, in order to prevent, delay or hinder the enforcement or
foreclosure of this Mortgage, or the absolute sale of the Mortgaged
Property, or any part thereof, or the final and absolute putting into
possession thereof, immediately after such sale, of the purchaser or
purchasers thereat, and the Mortgagor, for itself and all who may claim
through or under it, hereby waives the benefit of all such laws unless such
waiver shall be forbidden by law.
ARTICLE IV
POSSESSION UNTIL DEFAULT-DEFEASANCE CLAUSE
SECTION 1. Until some one or more of the events of default shall
have happened, the Mortgagor shall be suffered and permitted to retain
actual possession of the Mortgaged Property, and to manage, operate and use
the same and any part thereof, with the rights and franchises appertaining
thereto, and to collect, receive, take, use and enjoy the rents, revenues,
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issues, earnings, income, products and profits thereof or therefrom,
subject to the provisions of this Mortgage.
SECTION 2. If the Mortgagor shall well and truly pay or cause to
be paid the whole amount of the principal of and interest on the notes at
the time and in the manner therein provided, according to the true intent
and meaning thereof, and shall also pay or cause to be paid all other sums
payable hereunder by the Mortgagor and shall well and truly keep and
perform according to the true intent and meaning of this Mortgage, all
covenants herein required to be kept and performed by it, then and in that
case, all property, rights and interests hereby conveyed or assigned or
pledged shall revert to the Mortgagor and the estate, right, title and
interest of the Mortgagee and the noteholders shall thereupon cease,
determine and become void and the Mortgagee and the noteholders, in such
case, on written demand of the Mortgagor but at the Mortgagor's cost and
expense, shall enter satisfaction of this Mortgage upon the record. In any
event, each noteholder, upon payment in full to him by the Mortgagor of all
principal of and interest on any note held by him and the payment and
discharge by the Mortgagor of all charges due to such noteholder hereunder,
shall execute and deliver to the Mortgagor such instrument of satisfaction,
discharge or release as shall be required by law in the circumstances.
ARTICLE V
MISCELLANEOUS
SECTION 1. It is hereby declared to be the intention of the
Mortgagor that all lines, or systems, embraced in the Mortgaged Property,
including, without limitation, all rights of way and easements granted or
given to the Mortgagor or obtained by it to use real property in connection
with the construction, operation or maintenance of such lines, or systems,
and all service and connecting lines, poles, posts, crossarms, wires,
cables, conduits, ducts, connections and fixtures forming part of, or used
in connection with, such lines, or systems, and all other property
physically attached to any of the foregoing-described property, shall be
deemed to be real property.
SECTION 2. To the extent that any property described or referred
to in this Mortgage is governed by the provisions of the Uniform Commercial
Code, this Mortgage is hereby deemed a "security agreement" under the
Uniform Commercial Code, and this Mortgage is also hereby declared to be
"financing statement" under the Uniform Commercial Code for said security
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agreement. The mailing address of the Mortgagor as debtor and the
Mortgagee as secured party are as set forth in Section 6 of this Article V.
SECTION 3. All acts and obligations of the Mortgagor hereunder
shall be subject to all applicable orders, rules and regulations, now or
hereafter in effect, of all regulatory bodies having jurisdiction in the
premises, to the end that no act or omission to act on the part of the
Mortgagor shall constitute a default hereunder insofar as such act or
omission shall have been required by reason of any order, rule or
regulation of any such regulatory body.
SECTION 4. All of the covenants, stipulations, promises,
undertakings and agreements herein contained by or on behalf of the
Mortgagor shall bind its successors and assigns, whether so specified or
not, and all titles, rights and remedies hereby granted to or conferred
upon the Mortgagee shall pass to and inure to the benefit of the successors
and assigns of the Mortgagee and shall be deemed to be granted or conferred
for the ratable benefit and security of all who shall from time to time be
the holders of notes executed and delivered as herein provided.
SECTION 5. The descriptive headings of the various articles of
this Mortgage were formulated and inserted for convenience only and shall
not be deemed to affect the meaning or construction of any of the
provisions hereof.
SECTION 6. All demands, notices, reports, approvals,
designations, or directions required or permitted to be given hereunder
shall be in writing and shall be deemed to be properly given if mailed by
registered mail addressed to the proper party or parties at the following
addresses:
As to the Mortgagor: Dakota Cooperative Telecommunications, Inc.
P. ▇. ▇▇▇ ▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
As to the Mortgagee: Rural Electrification Administration
Washington, D. C. 20250-1500
and as to any other person, firm, corporation or governmental body or
agency having an interest herein by reason of being the holder of any note
or otherwise, at the last address designated by such person, firm,
corporation, governmental body or agency to the Mortgagor and the
Mortgagee. The Mortgagor or the Mortgagee may from time to time designate
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to one another a new address to which demands, notices, reports, approvals,
designations or directions may be addressed and from and after any such
designation the address designated shall be deemed to be the address of
such party in lieu of the address hereinabove given. The Mortgagor will
promptly notify the Mortgagee in writing of any change in location of its
chief place of business or the office where its records concerning accounts
and contract rights are kept.
SECTION 7. The invalidity of any one or more phrases, clauses,
sentences, paragraphs or provisions shall not affect the remaining portions
of this Mortgage, nor shall any such invalidity as to any holder of notes
hereunder affect the rights hereunder of any other holder of notes.
SECTION 8. This Mortgage may be simultaneously executed in any
number of counterparts, and all said counterparts executed and delivered,
each as an original, shall constitute but one and the same instrument.
IN WITNESS WHEREOF, DAKOTA COOPERATIVE TELECOMMUNICATIONS, INC.,
▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as Mortgagor and debtor, has caused
this Mortgage to be signed in its name and its corporate seal to be
hereunto affixed and attested by its officers thereunto duly authorized,
and UNITED STATES OF AMERICA, as Mortgagee and secured party, has caused
this Mortgage to be duly executed in its behalf, all as of the day and year
first above written.
DAKOTA COOPERATIVE
TELECOMMUNICATIONS, INC.
(Seal) by /s/
Attest: /s/ President
Secretary
Executed by the Mortgagor
in the presence of:
/s/
/s/
Witnesses
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▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ OF AMERICA
by /s/
Administrator
of
Rural Electrification Administration
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REA PROJECT DESIGNATION:
SOUTH DAKOTA 515-T8 IRENE
SUPPLEMENT TO RESTATED MORTGAGE, SECURITY AGREEMENT
AND FINANCING STATEMENT
made by and among
DAKOTA COOPERATIVE TELECOMMUNICATIONS, INC.
P. ▇. ▇▇▇ ▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
as mortgagor and debtor,
and
UNITED STATES OF AMERICA
Rural Electrification Administration
Washington, D. C. 20250-1500,
as mortgagee and secured party.
THIS INSTRUMENT GRANTS INTEREST IN A TRANSMITTING UTILITY
THE TYPES OF PROPERTY COVERED BY THIS INSTRUMENT ARE DESCRIBED ON PAGES 4-6
AFTER-ACQUIRED PROPERTY IS COVERED BY THIS INSTRUMENT
PROCEEDS AND PRODUCTS OF COLLATERAL ARE COVERED BY THIS INSTRUMENT
FUTURE ADVANCES AND FUTURE OBLIGATIONS ARE SECURED BY THIS INSTRUMENT
THE SIGNATURES OF THE PARTIES TO THIS INSTRUMENT ARE ON PAGES 14-15
THIS DOCUMENT WAS DRAFTED BY THE OFFICE OF THE GENERAL COUNSEL, UNITED
STATES DEPARTMENT OF AGRICULTURE, WASHINGTON, D. C., 20250-1400
TAXPAYERS IDENTIFICATION ▇▇. ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇
Tel. Supp. Mtge. (100% REA) - 1/92
(No Prior Bank Loan)-Restated
(TEL-MTG2)
SUPPLEMENT TO RESTATED MORTGAGE, SECURITY
AGREEMENT AND FINANCING STATEMENT, dated as of
April 13, 1992, made by and between DAKOTA COOPERATIVE
TELECOMMUNICATIONS, INC.----------------------------
---------------------------------------(hereinafter
called the "Mortgagor"), a corporation existing under
the laws of the State of South Dakota-----------------,
and UNITED STATES OF AMERICA (hereinafter called the
"Mortgagee") acting through the Administrator of the
Rural Electrification Administration (hereinafter
called "REA").
WHEREAS, the Mortgagor, for value received, has heretofore duly
authorized and executed, and has delivered to the Mortgagee, or has assumed
the payment of, certain mortgage notes all payable to the order of the
Mortgagee, in installments, of which certain mortgage notes (hereinafter
collectively called the "Outstanding Notes") identified in the fourth
recital hereof (hereinafter called the "Instruments Recital") are now
outstanding and held by the Mortgagee, all of which Outstanding Notes
evidence loans made by the Mortgagee either to the Mortgagor or to third
parties to finance telephone exchanges, lines and related facilities; and
WHEREAS, the Outstanding Notes are secured by the security
instrument or instruments (hereinafter called the "Mortgage"), made by and
between the Mortgagor and the Mortgagee, identified in the Instruments
Recital; and
WHEREAS, the Mortgagor has determined to borrow additional funds
from the Mortgagee, and has accordingly duly authorized, executed and
delivered to the Mortgagee its mortgage note or notes (identified in the
Instruments Recital and hereinafter called, as the case may be, the
"Current Note" or "Current Notes") to be secured by the Mortgage, as
amended and supplemented hereby, of the property hereinafter described; and
WHEREAS, the instruments referred to in the preceding recitals
are identified as follows:
Tel. Supp. Mtge. (100% REA) - 1/92
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(TEL-MTG2)
INSTRUMENTS RECITAL
"Outstanding Notes":
Nineteen-------------------(19) certain mortgage notes in an aggregate
principal amount of $15,950,000---------------------, all of which will
finally mature on or before March 10, 2021.
"Mortgage":
INSTRUMENT DATE
Restated Mortgage, Security Agreement March 10, 1986
and Financing Statement
"Current Note(s)": (Of even date herewith):
INTEREST RATE FINAL
PRINCIPAL AMOUNT (PER ANNUM) PAYMENT DATE
$7,855,000 five percentum (5%) Twenty-two---(22)
years after the
date thereof
WHEREAS, the Mortgagee is the owner and holder of the Outstanding
Notes and the Mortgage; and
WHEREAS, it was the intention of the Mortgagor at the time of the
execution of the Mortgage (or, if the Mortgage consists of more than one
instrument, at the time of execution of the earliest instrument thereof)
that the property of the Mortgagor of the classes described therein, as
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being mortgaged or pledged thereby, or intended so to be, whether then
owned or thereafter acquired, would secure certain notes of the Mortgagor
executed and delivered prior to the execution and delivery of the Mortgage
(or, if the Mortgage consists of more than one instrument, prior to the
execution and delivery of the earliest instrument thereof), and certain
notes of the Mortgagor when and as executed and delivered under and
pursuant to the Mortgage, as from time to time amended or supplemented, and
it is intended by the Mortgagor to confirm hereby the Mortgage and the
property therein described as being mortgaged or pledged, or intended so to
be, as security for the Outstanding Notes, and other notes of the Mortgagor
when and as executed and delivered under and pursuant to the Mortgage, as
amended and supplemented hereby; and
WHEREAS, the Mortgage provides that the Mortgagor shall, upon the
request in writing of the holder or holders of not less than a majority in
principal amount of the notes secured by the Mortgage at the time
outstanding duly authorize, execute, deliver, record and file all such
supplemental mortgages and conveyances as may reasonably be requested by
such holder or holders to effectuate the intention of the Mortgage and to
provide for the conveying, mortgaging and pledging of the property of the
Mortgagor intended to be conveyed, mortgaged or pledged by the Mortgage to
secure the payment of the principal of and interest on notes executed and
delivered thereunder and pursuant thereto, or otherwise secured thereby,
and the holder of all such notes has in writing requested the execution and
delivery of this Supplement to Restated Mortgage, Security Agreement and
Financing Statement (hereinafter called "this Supplemental Mortgage")
pursuant to such provisions; and
WHEREAS, it s further intended by the Mortgagor, at the request
and with the consent of the Mortgagee, to amend the Mortgage in the
respects hereinafter set forth; and
WHEREAS, all acts, things, and conditions prescribed by law and
by the articles of incorporation and bylaws of the Mortgagor have been duly
performed and complied with to authorize the execution and delivery hereof
and to make the Mortgage, as amended and supplemented hereby, a valid and
binding mortgage to secure the Outstanding Notes and other notes of the
Mortgagor when and as executed and delivered under and pursuant to the
Mortgage, as amended and supplemented hereby; and
WHEREAS, the Mortgagee is authorized to enter into this
Supplemental Mortgage; and
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WHEREAS, to the extent that any of the property described or
referred to herein and in the Mortgage is governed by the provisions of the
Uniform Commercial Code of any state (hereinafter called the "Uniform
Commercial Code"), the parties hereto desire that the Mortgage and this
Supplemental Mortgage, collectively, be regarded as a "security agreement"
under the Uniform Commercial Code and that this Supplemental Mortgage be
regarded as a "financing statement" under the Uniform Commercial Code for
said security agreement.
NOW, THEREFORE, in consideration of the premises and the sum of
$5 in hand paid by the Mortgagee to the Mortgagor, the receipt whereof by
the Mortgagor prior to the execution and delivery of this Supplemental
Mortgage is hereby acknowledged, this Supplemental Mortgage witnesseth as
follows:
1. The Mortgagor has executed and delivered this Supplemental
Mortgage and has granted, bargained, sold, conveyed, warranted, assigned,
transferred, mortgaged, pledged and set over, and by these presents does
hereby grant, bargain, sell, convey, warrant, assign, transfer, mortgage,
pledge and set over, unto the Mortgagee and its respective assigns, all and
singular the real and personal property described in the Mortgage as being
mortgaged thereby and all and singular the real and personal property of
the Mortgagor falling within the classes of property embraced in the
description of the "Mortgaged Property" set forth in the Mortgage,
including, without limitation, all and singular the real and personal
property of said description heretofore or hereafter acquired by or
constructed by or on behalf of the Mortgagor and wheresoever situate,
including, without limitation, the "Existing Facilities" identified, and
the real estate specifically described (by reference to deeds or
otherwise), in the Mortgage and mortgaged thereby (except such portions, if
any, thereof as have been released prior to the execution and delivery of
this Supplemental Mortgage), and, including, without limitation the
following described real property, located in the Counties of Clay,
Hutchinson, Lincoln, McCook, Minnehaha, ▇▇▇▇▇▇, Union and Yankton in the
State of South Dakota, to wit:
CLAY COUNTY
1. A tract of land described as Lots Eleven (11) and Twelve (12), of
Block Eight (8) of the original town of ▇▇▇▇▇, in Clay County in a
deed dated July 10, 1967 by ▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇▇▇, his wife, grantor
to the mortgagor, as grantee and recorded on July 11, 1967 in the
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office of the Register of Deeds of Clay County in the State of South
Dakota in deed book 48, page 327.
2. A tract of land described as Lot "C" of Lot Two (2), in the Northeast
one-quarter (NE1/4) of Section Six (6), Township Ninety-five (95),
North of Range Fifty-three (53) West of the 5th P.M. of Clay County,
South Dakota in a deed dated September 16, 1974, by ▇▇▇▇▇▇ ▇. and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, his wife, as grantor to the Mortgagor, as
grantee and recorded on September 18, 1974, in the office of the
Register of Deeds of Clay County in the State of South Dakota, indeed
book 54, page 298.
3. A tract of land described as Lot Fourteen (14), of Block Seven (7),
being a part of Outlot "C" of the town of Wakonda, County of Clay,
South Dakota in a deed dated August 25, 1953, by ▇▇▇▇▇ ▇▇▇▇▇▇, a
single person, as grantor to the Mortgagor, as grantee and recorded on
October 20, 1953, in the office of the Register of Deeds of Clay
County in the State of South Dakota in deed book 43, page 295.
LINCOLN COUNTY
1. A tract of land described as Lot D-C in the Northwest quarter (NW1/4)
of Section Thirty-three (33), Township Ninety-six (96), Range Fifty
(50), West of 5th P.M., Lincoln County, South Dakota, in a deed dated
August 25, 1964, by the American Lutheran Church, as grantor to the
Mortgagor, as grantee, and recorded on October 13, 1964, in the office
of the Register of Deeds of Lincoln County, in the State of South
Dakota in deed book 72, page 47.
2. A tract of land described as Lot Fifteen (15) in Block Eleven (11), of
the original plot of the city of Lennox, South Dakota, in a deed dated
July 26, 1956, by ▇▇▇▇ ▇. ▇▇▇▇▇, as grantor to the Mortgagor, as
grantee and recorded on July 30, 1956, in the office of the Register
of Deeds of Lincoln County, in the State of South Dakota in deed
book 64, page 243.
3. A tract of land described as Lot Sixteen (16) and the West ninety-two
(92) feet of Lots Seventeen (17) and Eighteen (18), all in Block Eight
(8) of the original town of Worthing, Lincoln County, South Dakota in
a deed book dated August 3, 1973, by ▇▇▇▇▇ ▇▇▇▇▇▇▇, a widow, as
grantor to the Mortgagor, as grantee and recorded on August 22, 1973,
in the office of the Register of Deeds of Lincoln County, in the State
of South Dakota in deed book 79, page 460.
4. A tract of land described as Lots One (1) and Two (2), of Block Five
(5) being a part of Tracts 1A and 1B in Industrial Tract No. 1, city
of Lennox, Lincoln County, South Dakota, in a deed dated March 24,
1982, by the Lennox Area Development Corporation, a corporation, as
grantor to the Mortgagor, as grantee, and recorded March 25, 1982 in
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the office of the Register of Deeds of Lincoln County, in the State of
South Dakota in deed book 88, page 202.
▇▇▇▇▇▇ COUNTY
1. A tract of land described as the West half (W1/2) of Lots Thirteen
(13) and Fourteen (14), of Block One (1) of original (Plot of) the
town of Chancellor, South Dakota, being a part of the Northeast one-
quarter (NE1/4) of Section Twenty-eight (28), Township 99, Range 52,
▇▇▇▇▇▇ County South Dakota in a deed dated August 15, 1956, by C. T.
▇▇▇▇▇▇, as grantor to the Mortgagor, as grantee and recorded on
August 16, 1956, in the office of Register of Deeds of ▇▇▇▇▇▇ County
in the State of South Dakota in deed book 79, page 235.
2. A tract of land described as Lots Twenty-five (25), Twenty-six (26),
and Twenty-seven (27), Block (7), original town of ▇▇▇▇▇, being a part
of the West One-half (W1/2), Southeast One-quarter (SE1/4), of Section
Thirty-three (33), Township 98, Range 52, ▇▇▇▇▇▇ County, South Dakota
in a deed dated March 23, 1953, by Dakota State Telephone Company (a
corporation), as grantor to the Mortgagor, as grantee and recorded on
September 1, 1953, in the office of the Register of Deeds of ▇▇▇▇▇▇
County in the State of South Dakota in deed book 78, pages 57, 58, 59
and 60.
3. A tract of land described as Outlot "A" of the Southeast One-quarter
(SE1/4) of the Southeast One-quarter (SE1/4), of Section Twenty-three
(23), Township Ninety-seven (97), North, Range Fifty-five (55), West
of the 5th P.M., ▇▇▇▇▇▇ County, South Dakota in a deed dated July 9,
1954, by ▇▇▇▇ ▇▇▇▇▇▇▇▇, a widower, as grantor to the Mortgagor, as
grantee and recorded July 12, 1954 in the office of the Register of
Deeds in ▇▇▇▇▇▇ County in the State of South Dakota in deed book 77,
page 469.
4. A tract of land described as the North Eighty (80') feet of Lots Eight
(8) and Nine (9), Block Twenty-three (23), of the original town, city
of ▇▇▇▇▇▇, South Dakota, being a part of the Northeast One-quarter
(NE1/4) of Section Twenty-seven (27), Township 98, Range 53, ▇▇▇▇▇▇
County, South Dakota in a deed dated November 14, 1968 by ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, his wife, as grantors to the
Mortgagor, as grantee and recorded November 15, 1968 in the office of
the Register of Deeds, ▇▇▇▇▇▇ County in the State of South Dakota in
deed book 84, page 40.
5. A tract of land described as Lot Ten (10), of Block Twenty-three (23),
of the original Plot of the town of Hurley, South Dakota, being a part
of the Northeast One-quarter (NE1/4) of Section Twenty-seven (27),
Township 98, Range 53, ▇▇▇▇▇▇ County, South Dakota in a deed dated
January 3, 1961, by ▇▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, his wife, as
grantors to the Mortgagor, as grantee and recorded January 4, 1961 in
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the office of the Register of Deeds, ▇▇▇▇▇▇ County in the State of
South Dakota in deed book 80, page 421.
6. A tract of land described as Lots Ten (10), Eleven (11), Twelve (12)
and Thirteen (13), all in Block One (1) of the town of Monroe
(formerly the town of Warrington) in the Northeast One-quarter (NE1/4)
of Section Fifteen (15), Township 100, Range 54, West of the 5th P.M.,
County of ▇▇▇▇▇▇, South Dakota in a deed dated August 4, 1953 by
▇▇▇▇▇▇ County as grantor to the Mortgagor, as grantee and recorded
August 10, 1953 in the office of the Register of Deeds, ▇▇▇▇▇▇ County
in the State of South Dakota in deed book 78, page 54.
7. A tract of land described as Lot Fifteen (15), Block Four (4), of the
original (Plot) of the town, now the city of ▇▇▇▇▇▇, South Dakota,
being a part of the Northeast One-quarter (NE1/4) of Section Seventeen
(17), Township 99, Range 53, ▇▇▇▇▇▇ County in the State of South
Dakota in a deed dated June 13, 1956, by ▇▇▇▇▇▇▇ ▇. Koloyjian,
▇▇▇▇▇▇ ▇. Koloyjian, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ as
grantors to the Mortgagor, as grantee and recorded July 25, 1956, in
the office of the Register of Deeds, ▇▇▇▇▇▇ County in the State of
South Dakota in deed book 78, page 141.
UNION COUNTY
1. A tract of land described as commencing at a point One hundred fifty-
seven (157') feet North of the Southwest corner of the Northwest One-
quarter (NW1/4) of Section Eighteen (18), Township 94 North, Range 50,
West of the 5th P.M., in Union County, South Dakota, thence North
Sixty-six (66') feet, thence East Fifteen (15) rods, then South Sixty-
six (66') feet, thence West Fifteen (15) rods to place of beginning in
Union County, South Dakota, according to the Government Survey
thereof. Said real estate is also described as the North Sixty-six
(66') feet of the South Two-hundred twenty-three (223') feet of West
Fifteen (15) rods of the Northwest One-quarter (NW1/4) of Section
Eighteen (18), Township 94 North, Range 50 West of the 5th P.M., Union
County, South Dakota in a deed dated January 7, 1971, by the Alsen
Community Telephone Company, (a corporation), as grantor to the
Mortgagor, as grantee, and recorded on March 4, 1971, in both offices
of the Register of Deeds Union and Clay counties in the State of South
Dakota in the Union County deed book 61, page 58, and the Clay County
deed book 51, pages 61-65.
YANKTON COUNTY
1. A tract of land described as the East Forty-feet (40') of the South
Thirty-feet (30') of ▇▇▇ ▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
situated on the Southeast One-quarter (SE1/4) of the Northwest One-
quarter (NW1/4) of Section Twelve (12), Township 98, Range 54, Yankton
County South Dakota in a deed dated October 31, 1973, by Northwestern
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▇▇▇▇ Telephone Company (a Corporation), as grantor to the Mortgagor,
as grantee and recorded November 12, 1973 in the office of the
Register of Deeds, Yankton County in the State of South Dakota in deed
book 259, page 140.
2. A tract of land described as Outlot "A" of the Northeast One-quarter
(NE1/4) of Section Twenty-seven (27), Township Ninety-six (96) North,
Range Fifty-five (55), West of the 5th P.M. in Yankton County, South
Dakota, in a deed dated July 3, 1954, by ▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇, his wife, as grantors to the Mortgagor, as grantee and recorded
July 7, 1954 in the office of the Register of Deeds, Yankton County in
the State of South Dakota in deed book 205, page 193.
3. A tract of land described as Lots Seventeen (17) and eighteen (18) in
Block Eight (8) of Volin Addition, town of Volin, Yankton County,
South Dakota in deeds dated July 24, 1954 and August 2, 1954 and
August 24, 1954, by ▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇, his wife, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ (also known as ▇▇▇▇▇▇▇▇▇), ▇▇▇▇▇ ▇▇▇▇▇▇, formerly ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ (also known as ▇▇▇▇▇▇▇▇▇), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (also known as
▇▇▇▇▇▇▇▇▇) (also known as ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇), ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Hove (also known as ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Hove), ▇▇▇▇▇ ▇. ▇▇▇▇▇ (also known
as ▇.▇. ▇▇▇▇▇) and ▇▇▇▇ ▇▇▇▇▇▇, as grantors to the Mortgagor, as
grantee and all deeds recorded August 30, 1954 in the office of the
Register of Deeds, Yankton County in the State of South Dakota in deed
book and page as follows:
GRANTOR DEED BOOK PAGE
------- --------- ----
▇▇▇▇ ▇. and ▇▇▇▇▇ ▇▇▇▇▇ 199 89
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 199 90
▇▇▇▇▇ ▇▇▇▇▇▇ 199 ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 199 93
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Hove 199 91
▇▇▇▇▇ ▇. ▇▇▇▇▇ 199 88
▇▇▇▇ ▇▇▇▇▇▇ 206 141
LINCOLN COUNTY
The East 323.4 feet of the North 478 feet of County Auditors Tract 1 in
Original Government Lot 1 in the Northeast Quarter of Section 12,
Township 100 North, Range 51 West of the 5th P.M., Lincoln County, South
Dakota, according to the recorded plat thereof, except the East 33 feet
thereof now dedicated as Sundowner Avenue. Grantor, ▇▇▇▇ Assam; Grantee,
Dakota Cooperative Telecommunications, Inc. Recorded with the Register of
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Deeds of Lincoln County, South Dakota on September 6, 1990 at 10:30 AM, and
recorded in Book 96 of Deeds on page 777.
▇▇▇▇▇▇ COUNTY
Lots Eleven and Twelve, of Block 23, Original Town of ▇▇▇▇▇▇, being a part
of the Northeast Quarter of ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇ of the
5th P.M., ▇▇▇▇▇▇ County, South Dakota. Grantor, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇; Grantee, Dakota Cooperative Telecommunications, Inc.
Recorded with the Register of Deeds of ▇▇▇▇▇▇ County, South Dakota on
October 30, 1991 at 2:30 PM, and recorded in book 101 at page 357.
TOGETHER WITH all plants, works, structures, erections, reservoirs, dams,
buildings, fixtures and improvements now or hereafter located on any of the
properties conveyed by any and all of the aforesaid deeds mentioned above,
and all tenements, hereditaments and appurtenances now or hereafter
thereunto belonging or in any wise appertaining.
The description of each of the properties conveyed by and through the
provisions of the aforesaid deeds is by reference made a part hereof as
though fully set forth at length herein.
AND ALSO including, without limitation:
All right, title and interest of the Mortgagor in and to all
extensions and improvements of the Existing Facilities as aforesaid and
additions thereto, and all buildings, plants, works, improvements,
structures, estates, grants, franchises, easements, rights, privileges and
properties real, personal and mixed, tangible or intangible, of every kind
or description, now owned or leased by the Mortgagor or which may hereafter
be owned or leased, constructed or acquired by the Mortgagor, wherever
located, and in and to all extensions and improvements thereof and
additions thereto, including all buildings, plants, works, structures,
improvements, fixtures, apparatus, materials, supplies, machinery, tools,
implements, poles, posts, crossarms, conduits, ducts, lines, whether
underground or overhead or otherwise, wires, cables, exchanges, switches,
including, without limitation, host switches and remote switches, desks,
testboards, frames, racks, motors, generators, batteries and other items of
central office equipment, paystations, protectors, instruments, connections
and appliances, office furniture and equipment, work equipment and any and
all other property of every kind, nature and description, used, useful or
acquired for use by the Mortgagor in connection therewith;
All right, title and interest of the Mortgagor in, to and under
any and all grants, privileges, rights of way and easements now owned,
held, leased, enjoyed or exercised, or which may hereafter be owned, held,
leased, acquired, enjoyed or exercised, by the Mortgagor for the purposes
of, or in connection with, the construction or operation by or on behalf of
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the Mortgagor of telephone properties, facilities, systems or businesses,
whether underground or overhead or otherwise, wherever located;
All right, title and interest of the Mortgagor in, to and under
any and all licenses, franchises, ordinances, privileges and permits
heretofore granted, issued or executed, or which may hereafter be granted,
issued or executed, to it or to its assignors by the United States of
America, or by any state, or by any county, township, municipality, village
or other political subdivision thereof, or by any agency, board, commission
or department of any of the foregoing, authorizing the construction,
acquisition or operation of telephone properties, facilities, systems or
businesses, insofar as the same may by law be assigned, granted, bargained,
sold, conveyed, transferred, mortgaged, or pledged;
All right, title and interest of the Mortgagor in, to and under
any and all contracts heretofore or hereafter executed by and between the
Mortgagor and any person, firm, or corporation relating to the property
mortgaged and pledged by the Mortgage and this Supplemental Mortgage,
together with any and all other accounts, chattel paper, contract rights
and general intangibles (as such terms are defined in the applicable
Uniform Commercial Code), and all stock, bonds, notes, debentures,
commercial paper, subordinated capital certificates, securities,
obligations of or beneficial interests or investments in any corporation,
association, partnership, joint venture, trust, United States of America or
any agency or department thereof, or any other entity of any kind,
heretofore or hereafter acquired by the Mortgagor;
All right, title and interest of the Mortgagor in and to all
other property, real or personal, tangible or intangible, of every kind,
nature and description, and wheresoever situated, now owned or leased or
hereafter acquired by the Mortgagor, it being the intention hereof that all
such property now owned or leased but not specifically described herein or
acquired or held by the Mortgagor after the date hereof shall be as fully
embraced within and subjected to the lien hereof as if the same were now
owned by the Mortgagor and were specifically described herein to the extent
only, however, that the subjection of such property to the lien hereof
shall not be contrary to law;
Together with all rents, income, revenues, profits and benefits
at any time derived, received or had from any and all of the above-described
property of the Mortgagor.
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Provided, however, that except as provided in section 12(b) of
article II of the Mortgage, as amended and supplemented hereby, no
automobiles, trucks, trailers, tractors or other vehicles (including
without limitation aircraft or ships, if any) owned or used by the
Mortgagor shall be included in the property mortgaged by the Mortgage and
this Supplemental Mortgage.
TO HAVE AND TO HOLD the same forever, for the uses and purposes and upon
the terms, conditions, provisos and agreements expressed and declared in
the Mortgage, as amended and supplemented hereby.
2. The Outstanding Notes are hereby confirmed as notes of the
Mortgagor entitled to the security of the Mortgage, as amended and
supplemented by this Supplemental Mortgage, and of the property by the
Mortgage and this Supplemental Mortgage mortgaged and pledged, or intended
so to be, equally and ratably with one another and with other notes of the
Mortgagor when and as executed and delivered under and pursuant to the
Mortgage, as amended and supplemented hereby, without preference, priority
or distinction of any one of the Outstanding Notes or such other notes over
any other thereof and irrespective of the date of the execution, delivery
or maturity thereof, or of the assignment or negotiation thereof.
3. The Current Note(s) are hereby included within the term
"notes", as defined in the Mortgage, as amended and supplemented hereby.
4. The fourth numbered paragraph of the Instruments Recital of
the Mortgage is amended by deleting the first sentence thereof.
5. The Instruments Recital of the Mortgage is amended by adding
thereto the following paragraph 5:
5. The Forecast Period referred to in Article II,
Section 20(a) of this Mortgage shall be the period commencing with the
date of the last document to add or amend this paragraph 5 and ending
December 31, 1994. Also in Article II, Section 20(a), the TIER the
Mortgagor is required to maintain after the end of the Forecast Period
shall be 1.12.
6. Article II, section 7 of the Mortgage is amended to read as
follows:
SECTION 7. (a) The Mortgagor will take out, as the
respective risks are incurred, and maintain the following classes and
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amounts of insurance: (1) fidelity bonds covering each officer and
employee of the Mortgagor in not less than the following amounts,
based on the estimated annual gross revenues (including gross toll
collected) of the Mortgaged Property:
AMOUNT OF
ANNUAL GROSS REVENUE COVERAGE
Less than $ 200,000 $ 50,000
From $200,001 to 400,000 100,000
400,001 to 600,000 250,000
600,001 to 800,000 300,000
800,001 to 1,000,000 400,000
over 1,000,000 500,000
and each collection agent of the Mortgagor shall be included in such
fidelity bonds for not less than $2,500, or 10 percent of the highest
amount collected annually by any one collection agent, whichever is
greater; (2) workmen's compensation insurance covering all employees
of the Mortgagor, in such amounts as may be required by law, or if the
Mortgagor or any of its employees are not subject to the workmen's
compensation laws of the State or States in which the Mortgagor
conducts its operations, then its workmen's compensation policy shall
provide voluntary compensation coverage to the same extent as though
the Mortgagor and such employees were subject to such laws; and
including occupational disease liability coverage, employer's
liability insurance, and "additional medical" coverage of not less
than $10,000 in States where full medical coverage is not required by
law; (3) public liability and property damage liability insurance,
covering ownership liability, and all operations of the Mortgagor,
with limits for bodily injury or death of not less than $1,000,000
aggregate for the policy period; (4) liability insurance on all motor
vehicles, trailers, semitrailers, and aircraft used in the conduct of
the Mortgagor's business, whether owned, non-owned or hired by the
Mortgagor, with bodily injury limits of not less than $1,000,000 for
one person and $1,000,000 for each accident, and with property damage
limits of $1,000,000 for each accident; in connection with aircraft
liability, also passenger bodily injury limits of $1,000,000 per
person and $1,000,000 for each accident; (5) comprehensive, or
separate fire, theft and windstorm insurance covering loss of or
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damage to all owned motor vehicles, trailers, and aircraft of the
Mortgagor, having a unit value in excess of $1,000, in an amount not
less than the actual cash value of the property insured; and (6) fire
and extended coverage insurance, designating the Government as
mortgagee in the policy, on each building, each building and its
contents, and materials, supplies, poles and crossarms, owned by the
Mortgagor, having a value at any one location in excess of $5,000, or
in excess of one percent of the total plant value, whichever is
larger, and in an amount not less than 80 percent of the current cost
to replace the property new, less actual depreciation.
The Mortgagor will also, from time to time, increase or
supplement the classes and amounts of insurance specified above to the
extent requested by the Administrator or required to conform to the
accepted practice of the telephone industry for companies of the size
and character of the Mortgagor. The Mortgagor will, upon request of
the majority noteholders, submit to the noteholder or noteholders
designated in such request a schedule of its insurance in effect on
the date specified in such request. If the Mortgagor shall at any
time fail or refuse to take out or maintain insurance or to make
changes in respect thereof upon appropriate request by such noteholder
or noteholders, such noteholder or noteholders may take out such
insurance on behalf and in the name of the Mortgagor, and the
Mortgagor will pay the cost thereof.
(b) In the event of damage to or the destruction or
loss of any portion of the Mortgaged Property which shall be covered
by insurance, unless the majority noteholders shall otherwise agree,
the Mortgagor shall replace or restore such damaged, destroyed or lost
portion so that the Mortgaged Property shall be in substantially the
same condition as it was in prior to such damage, destruction or loss,
and shall deposit the proceeds of the insurance in the Special
Construction Account required by the Consolidated Loan Agreement to be
applied for that purpose. The Mortgagor shall replace the loss or
shall commence such restoration promptly after such damage,
destruction or loss shall have occurred and shall complete such
replacement or restoration as expeditiously as practicable, and shall
pay or cause to be paid out of the proceeds of such insurance all
costs and expenses in connection therewith so that such replacement or
restoration shall be so completed that the portion of the Mortgaged
Property so replaced or restored shall be free and clear of all
mechanics' liens and other claims.
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(c) Sums recovered under any fidelity bond by the
Mortgagor for a loss of funds advanced under the notes or recovered
by the Mortgagee for any loss under such bond shall, unless otherwise
directed by the Mortgagee, be applied to the prepayment of the notes,
PRO RATA according to the unpaid principal amounts thereof (such
prepayments to be applied to such installments thereof as may be
designated by the respective noteholders at the time of such
prepayments) or to construct or acquire facilities approved by the
Mortgagee, which will become part of the Mortgaged Property.
(d) The foregoing insurance coverage shall be obtained
by means of bond and policy forms approved by regulatory authorities,
including standard REA endorsements and riders used by the insurance
industry to provide coverage for REA borrowers. Each policy or other
contract for such insurance shall contain an agreement by the insurer
that, notwithstanding any right or cancellation reserved to such
insurer, such policy or contract shall continue in force for at least
ten (10) days after written notice to the Mortgagee of cancellation.
7. Article II, section 9 of the Mortgage is amended to read as
follows:
SECTION 9. The Mortgagor will not, without the approval in
writing of the majority noteholders: (a) enter into any contract or
contracts for the operation or maintenance of all or any part of its
property, for the use by others of any of the Mortgaged Property, or
for toll traffic, operator assistance, extended scope or switching
services to be furnished by or for connecting or other companies;
provided, however, that such approval shall not be required for any
toll traffic or operator assistance contract which in form and
substance conforms with contracts in general use in the telephone
industry; or (b) deposit any of its funds, regardless of the source
thereof, in any bank, institution or other depository which is not
insured by the Federal Government.
8. Article II, section 10(b) of the Mortgage is amended to read
as follows:
(b) Salaries, wages and other compensation paid by the
Mortgagor for services, and directors' or trustees' fees, shall be
reasonable and in conformity with the usual practice or corporations
of the size and nature of the Mortgagor. Except as specifically
authorized in writing in advance by the majority noteholders, the
Mortgagor will make no advance payments or loans, or in any manner
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extend its credit, either directly or indirectly, with or without
interest, to any of its directors, trustees, officers, employees,
stockholders, members or affiliated companies, provided, however, the
Mortgagor may make an investment for any purpose described in
section 607(c)(2) of the Rural Development Act of 1972 (including any
investment in, or extension of credit, guarantee or advance made to,
an affiliated company of the Mortgagor that is used by such company
for such purpose) to the extent that, immediately after such
investment, (1) the aggregate of such investments does not exceed one-
third of the net worth (defined in Exhibit One) of the Mortgagor and
(2) the Mortgagor's adjusted net worth is at least twenty percent of
its total assets (defined in Exhibit One). As used in this section,
the term "affiliated companies" shall have the meaning prescribed for
this term by the Federal Communications Commission in its prevailing
uniform system of accounts for Class A telephone companies.
9. Article II, section 11 of the Mortgage is amended to read as
follows:
SECTION 11. The Mortgagor will at all times keep, and
safely preserve, proper books, records and accounts in which full and
true entries will be made of all of the dealings business and affairs
of the Mortgagor, in accordance with the methods and principles of
accounting then prescribed by the state regulatory body having
jurisdiction over the Mortgagor, or in the absence of such regulatory
body or such prescription, by the Federal Communications Commission in
its uniform system of accounts for telecommunications companies, as
those methods and principles of accounting may be supplemented, from
time to time, by the Administrator. The Mortgagor will prepare and
furnish each noteholder not later than the thirtieth day of January in
each year, or at such more or less frequent intervals when specified
by the majority REA noteholders, financial and statistical reports on
its condition and operations. Such reports shall be in such form and
include such information as may be specified by the majority REA
noteholders, including without limitation an analysis of the
Mortgagor's revenues, expenses, and subscriber accounts. The
Mortgagor will cause to be prepared and furnished to each noteholder
at least once during each twelve (12)-month period during the term
hereof, full and complete reports of its financial condition and cash
flow as of a date (hereinafter called the Fiscal Date"), and a full
and complete report of its operations of the twelve (12)-month period
ended on the Fiscal Date, all in form and substance satisfactory to
the majority REA noteholders, and will cause such reports to be
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furnished to each noteholder within 120 days of the Fiscal Date, such
reports having been audited and certified by independent certified
public accountants satisfactory to said noteholders and accompanied by
such reports of such audit in form and substance satisfactory to said
noteholders. The majority REA noteholders, through its or their
representatives, shall at all times during reasonable business hours
have access to, and the right to inspect and make copies of, any or
all books, records and accounts, and any or all invoices, contracts,
leases, payrolls, canceled checks, statements and other documents and
papers of every kind belonging to or in possession of the Mortgagor
and in anywise pertaining to its property or business. The Mortgagor
shall enter into an audit agreement with an independent certified
public accountant in form and substance satisfactory to the majority
REA noteholders.
10. Article II, section 12(b) of the Mortgage is amended by
adding the words "or net margins" after the words "net income" in the first
sentence thereof.
11. Article II, section 15 of the Mortgage is amended to read as
follows:
SECTION 15. (a) Except as specifically authorized in
writing in advance by the majority noteholders, the Mortgagor will not
declare or pay any dividends on its capital stock, membership
certificates or equity capital certificates (other than in shares of
such capital stock or in such certificates), or make any other
distribution to its stockholders, members or subscribers, or purchase,
redeem or retire any of its capital stock, membership certificates or
equity capital certificates, or make any investment in affiliated
companies (except as allowed by subsection (d) below), unless after
such action the Mortgagor's current assets (determined in accordance
with Exhibit One hereto) will equal or exceed its current liabilities
(determined in accordance with Exhibit One hereto) (exclusive of
current liabilities incurred for additions to plant), and the
Mortgagor's adjusted net worth (determined in accordance with Exhibit
One hereto) will be at least forty per centum (40%) of its adjusted
assets (determined in accordance with Exhibit One hereto), or the sum
of the following (whichever is the smaller amount):
(1) ten percentum (10%) of its adjusted assets, plus
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(2) thirty per centum (30%) of its adjusted net worth, if any,
in excess of the amount represented by the percentage of
adjusted assets set out in the immediately preceding
subparagraph (1), plus
(3) thirty per centum (30%) of the amount of any reduction of
its adjusted net worth after the date specified in the
Instruments Recital, resulting from the declaration or
payment of dividends or distributions, the purchase,
redemption or retirement of its capital stock, membership
certificates or equity capital certificates or investments
in affiliated companies.
(b) During such time or times as the Mortgagor's adjusted
net worth is less than ten percentum (10%):
(1) the Mortgagor will make no increase, without prior written
approval of the majority noteholders, in salaries, wages,
fees and other compensation paid to officers, directors,
trustees, executives, or supervisors of the Mortgagor, or to
other employees having either a substantial ownership
interest in the Mortgagor, or a close family relationship
with officers, directors, trustees, executives, supervisors,
or holders of substantial ownership interests in the
Mortgagor; and
(2) the Mortgagor will promptly furnish the majority noteholders
with certified copies of the minutes of all meetings of its
stockholders, members, directors or trustees; and
(3) if the operation of the Mortgaged Property for the preceding
calendar year resulted in a decrease in the Mortgagor's
retained earnings (determined in accordance with Exhibit One
hereto), the Mortgagor shall upon the written direction of
the majority noteholders, take all required action to
promptly (1) increase its charges for telephone service or
(2) execute a plan for reducing expenses, such increase in
charges and such plan to be submitted to all the noteholders
and to be acceptable to and approved in writing by the
majority noteholders.
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(c) During such time or times as the Mortgagor's adjusted
net worth is less than twenty percentum (20%) of its adjusted assets
the Mortgagor will promptly furnish the noteholders with a detailed
report on ownership or transfers of its capital stock, membership
certificates or equity capital certificates whenever requested in
writing by the majority noteholders, or whenever one percentum (1%) or
more of its outstanding ownership interests has been transferred since
the last preceding report to such noteholders on ownership interests
or transfers.
(d) If the Mortgagor's net worth (defined in Exhibit One
hereto) is equal to at least 20 percent of its total assets (defined in
Exhibit One), then the term "investment in affiliated companies" used
in subsection (a) of this section 15 shall not include investments by
the Mortgagor for any purpose described in section 607(c)(2) of the
Rural Development Act of 1972 (including any investment in, or
extension of credit, guarantee, or advance made to an affiliated
company of the Mortgagor that is used by such company for such
purpose) to the extent that, immediately after such investment, the
aggregate of such investments does not exceed one-third of the net
worth of the borrower.
12. Article II of the Mortgage is hereby amended by adding at
the end thereof the following new sections:
SECTION 20. (a) The Mortgagor, subject to applicable
laws and rules and orders of regulatory bodies, shall design its rates
for telephone service and other services furnished by it with a view
to paying and discharging all taxes, maintenance expenses and
operating expenses of its telephone system, and also to making all
payments in respect of principal of and interest on the notes when and
as the same shall become due, to providing and maintaining reasonable
working capital for the Mortgagor and to maintaining an Average TIER
on all of its outstanding indebtedness to the Government and all other
lenders of not less than 1.00 during the Forecast Period described in
the Instruments Recital and the TIER specified in the Instruments
Recital after the Forecast Period.
(b) For purposes of this section 20, Average TIER
shall be determined as of January 1 of each year during which any
obligation secured by the Mortgage remains unsatisfied and shall mean
the average of the two highest TIER ratios achieved by the Mortgagor
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during each of the three calendar years last preceding the various
dates of its determination.
(c) As used in this section 20, TIER means: The
Mortgagor's net income or net margins (determined in accordance with
Exhibit One hereto) plus interest expense (determined in accordance
with Exhibit One hereto) divided by interest expense.
SECTION 21. (a) Current assets, current liabilities, net
worth, adjusted net worth, adjusted assets, retained earnings, net
income or net margins, interest expense, and total assets, as used in
sections 10, 15 or 20 of Article II of this Mortgage, are determined
in accordance with Exhibit One of this Mortgage. Net plant and
secured debt, if referred to in this Mortgage, are also determined in
accordance with Exhibit One.
(b) Accounting terms used in this Mortgage shall
also apply to accounts or groups of accounts of the Mortgagor,
regardless of the account title or the system of accounts used, if
such accounts have substantially the same meaning as those prescribed
by the Federal Communications Commission in its prevailing uniform
system of accounts for telecommunications companies (47 CFR Part 32).
SECTION 22. Exhibit One, attached hereto, is made part of
the Mortgage.
13. To the extent that any of the property described or referred
to herein and in the Mortgage is governed by the provisions of the Uniform
Commercial Code, the Mortgage and this Supplemental Mortgage, collectively,
are hereby deemed a "security agreement" under the Uniform Commercial Code,
and this Supplemental Mortgage is also hereby declared to be a "financing
statement", under the Uniform Commercial Code for said security agreement.
The mailing address of the Mortgagor and debtor is as stated in the
testimonium clause hereof, and the mailing address of the Mortgagee and
secured party is Rural Electrification Administration, Washington, D.C.
20250-1500.
14. Exhibit One, attached hereto, is made part of the Mortgage
as Exhibit One thereto.
15. All of the terms, provisions and covenants of the Mortgage,
except as expressly modified hereby, shall be and remain in full force and
effect.
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16. The invalidity of any one or more phrases, clauses,
sentences, paragraphs or provisions of this Supplemental Mortgage shall not
affect the validity of the remaining portions hereof.
17. This Supplemental Mortgage may be simultaneously executed in
any number of counterparts, and all of said counterparts executed and
delivered, each as an original, shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, DAKOTA COOPERATIVE TELECOMMUNICATIONS, INC.,
P. O. Box 66, ▇▇▇▇▇, South Dakota 57014-----------------------------------
-------------------------------------------------------------------------,
as Mortgagor, has caused this Supplemental Mortgage to be signed in its
name and its corporate seal to be hereunto affixed and attested by its
officers thereunto duly authorized, and UNITED STATES OF AMERICA, as
Mortgagee, has caused this Supplemental Mortgage to be duly executed in its
behalf, all as of the day and year first above written.
DAKOTA COOPERATIVE
TELECOMMUNICATIONS, INC.
(Seal) by /s/ ▇▇▇▇ ▇. ▇▇▇▇
Attest: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ President
Secretary
Executed by the Mortgagor
in the presence of:
/S/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Witnesses
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UNITED STATES OF AMERICA
by /s/ ▇▇▇▇▇▇▇ ▇. ▇. ▇▇▇ as
Acting Administrator
of
Rural Electrification Administration
Executed by the Mortgagee in the
presence of:
/S/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Witnesses
-21-
STATE OF SOUTH DAKOTA )
) SS
COUNTY OF CLAY )
On this 13th day of April, 1992, before me, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, a
notary public, personally appeared ▇▇▇▇ ▇. ▇▇▇▇, known to me to be the
President of DAKOTA COOPERATIVE TELECOMMUNICATIONS, INC.------------------
------------------------------------, the Corporation that is described in
and that executed the within instrument, and acknowledged to me that such
corporation executed the same.
/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Notary Public
(Notarial Seal)
My commission expires: 1-18-94
RECEIPT
Dakota Cooperative Telecommunications, Inc. does hereby acknowledge receipt
of a full, true and complete copy of the above and foregoing Supplement to
Restated Mortgage delivered to it by the Mortgagee therein named this 13th
day of April, 1992.
by /s/ ▇▇▇▇ ▇. ▇▇▇▇
(Seal) President
Attest: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
Secretary
DISTRICT OF COLUMBIA ) SS
On this 5th day of March, 1992, before me, a Notary Public in and
for the District of Columbia, appeared ▇▇▇▇▇▇▇ ▇. ▇. ▇▇▇, to me personally
known, who, being by me duly sworn, did say that he is the Acting
Administrator of the Rural Electrification Administration of the United
States of America, and that said instrument was executed by him on behalf
of United States of America by authority vested in him as such officer; and
said Acting Administrator acknowledged said instrument to be the free act
and deed of United States of America, and that he delivered the same as
such.
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I hereby certify that said instrument was executed in my presence
and in the presence of the subscribing witnesses aforesaid.
/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Notary Public
(Notarial Seal)
My commission expires:
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Exhibit One (Exhibit to Mortgage)
UNIFORM SYSTEM OF ACCOUNTS
ACCOUNT NUMBERS USED IN CERTAIN PROVISIONS
THIS EXHIBIT CONSISTS OF 4 PAGES
All references regarding account numbers are to 47 CFR Part 32 and
supplementary accounts required by REA.
ACCOUNT NUMBERS
ACCOUNT NAMES CLASS A CLASS B
ADJUSTED ASSETS - Article II, Sec. 15(a): the sum of the balances of the
following accounts of the Mortgagor:
Current Assets 1100s thru 1300s
Noncurrent Assets 1400s thru 1500s
Total Telecommunications Plant (Defined Below)
LESS: Accumulated Depreciation 3100 thru 3300s
LESS: Accumulated Amortization 3400 thru 3600s
Funded Debt (Still to be advanced
under Loan Contract) ( 4210.20 4210.20
( 4210.21 4210.21
( 4210.22 4210.22
( 4210.24 4210.24
( 4210.23 4210.23
LESS: Adjustments (Defined Below)
ADJUSTMENTS: the sum of the balances of the following accounts of the
Mortgagor:
Telecommunications Accounts Receivable 1180* 1180*
Accounts Receivable Allowance -
Telecommunications 1181* 1181*
Other Accounts Receivable 1190* 1190*
Accounts Receivable Allowance - Other 1191* 1191*
Notes Receivable 1200* 1200*
Notes Receivable Allowance 1201* 1201*
(* Include Only Those Portions of These
Accounts Shown in Subsidiary Record
Accounts Related to Affiliates)
Investments in Affiliated Companies 1401 1401
Telecommunications Plant Adjustment & Goodwill
(Debit Amounts in Excess of Accumulated
Amortization) 2005 & 2007, LESS ▇▇▇▇
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INTEREST EXPENSE - Article II, Sec 21 or any other section of the Mortgage
setting forth a TIER requirement for the Mortgagor: the sum of the
balances of the following accounts of the Mortgagor:
Interest and Related Items 7500** 7500
Interest on Funded Debt 7510
Interest Expense - Capital Leases 7520
Amortization of Debt Issuance Expense 7530
Other Interest Deductions 7540
LESS: Allowance for Funds Used
During construction 7340 7300.4
NET INCOME OR NET MARGINS - Article II Sec 21 or any other section of the
Mortgage setting forth a TIER requirement for the Mortgagor: the sum of
the balances of the following accounts of the Mortgagor:
Local Network Services Revenues )
Network Access Services Revenues )
Long Distance Network Services Revenues ) 5000 thru 5300s
Miscellaneous Revenues )
LESS: Uncollectible Revenues )
Other Operating Income and Expense ) 7100** 7100
Nonoperating Income and Expense ) 7300** 7300
Income Effect of Jurisdictional
Rate-making Difference - Net ) 7910 7910
Nonregulated Net Income ) 7990 7990
Other Nonregulated Revenues ) 7991 7991
LESS balances of the following accounts:
Plant Specific Operations Expense )
Plant Nonspecific Operations Expense ) 6100s thru 6700s
Customer Operations )
Corporate Operations )
Operating Taxes ) 7200** 7200
Nonoperating Taxes ) 7400** 7400
Interest and Related Items ) 7500** 7500
Extraordinary Items ) 7600** 7600
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NET WORTH - Article II, Sec. 10(b) and Sec. 15(d): the sum of the balances
of the following accounts of the Mortgagor:
Capital Stock 4510 4510
Additional Paid-In Capital 4520 4520
Treasury Stock 4530 4530
Other Capital 4540 4540
Retained Earnings 4550 4550
NOTE: FOR NONPROFIT ORGANIZATIONS (OWNERS' EQUITY
SHALL BE SHOWN IN SUBACCOUNTS OF 4540 AND 4550)
** Summary Accounts
RETAINED EARNINGS - Article II, Sec. 15(b)(3): the balance of the
following account of the Mortgagor:
Retained Earnings 4550 4550
NOTE: FOR NONPROFIT ORGANIZATIONS - RETAINED
EARNINGS (MARGINS) SHALL BE SHOWN IN
SUBACCOUNTS OF 4550
TOTAL ASSETS - Article II, Sec. 10(b) and 15(d): the sum of the balances
of the following accounts of the Mortgagor:
Current Assets 1100s thru 1300s
Noncurrent Assets 1400s thru 1500s
Total Telecommunications Plant 2001 thru 2007
LESS: Accumulated Depreciation 3100 thru 3300s
LESS: Accumulated Amortization 3400 thru 3600s
-3-