Exhibit B-2
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and
SOUTHERN POWER COMPANY
LOAN AGREEMENT
Dated as of
Relating to
$______________
_________________________ Revenue Bonds
(Southern Power Company Project)
LOAN AGREEMENT
TABLE OF CONTENTS
(This Table of Contents is for convenience of reference
only and is not a part of this Loan Agreement)
PAGE
ARTICLE I: DEFINITIONS...........................................................................................1
ARTICLE II: ACQUISITION AND COMPLETION OF THE PROJECT; ISSUANCE OF THE BONDS......................................3
SECTION 2.1 Acquisition and Completion of the Project.....................................3
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SECTION 2.2 Issuance of the Bonds.........................................................3
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SECTION 2.3 Establishment of Completion Date..............................................3
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SECTION 2.4 Insufficiency of Construction Fund............................................4
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ARTICLE III: LOAN BY ISSUER; PROVISIONS FOR PAYMENT...............................................................4
SECTION 3.1. Loan by Issuer.............................................................................4
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SECTION 3.2. Delivery of Note by Company; Other Amounts Payable.........................................4
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SECTION 3.3. Obligation of the Company Unconditional....................................................5
SECTION 3.4. Assignment and Pledge of Payments and Rights Under the Note and .............................
the Agreement...................................................................................5
ARTICLE IV: SPECIAL COVENANTS....................................................................................5
SECTION 4.1. Use of Project............................................................................5
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SECTION 4.2. Indemnity Against Claims..................................................................5
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SECTION 4.3. The Company to Maintain Its Corporate Existence; Conditions Under Which Exceptions
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Permitted.......................................................................................6
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SECTION 4.4. Annual Statement..........................................................................6
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SECTION 4.5. Further Assurances and Corrective Instruments.............................................7
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SECTION 4.6. Maintenance of Project by Company.........................................................7
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SECTION 4.7. Redemption or Purchase of Bonds...........................................................7
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SECTION 4.8. Non-Arbitrage Covenant....................................................................7
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SECTION 4.9. No Issuer Liability.......................................................................8
SECTION 4.10 Post Issuance Audits......................................................................9
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ARTICLE V: EVENTS OF DEFAULT AND REMEDIES.........................................................................9
SECTION 5.1. Events of Default..........................................................................9
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SECTION 5.2. Remedies on Default.......................................................................10
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SECTION 5.3. Agreement to Pay Attorneys' Fees and Expenses.............................................11
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SECTION 5.4. No Additional Waiver Implied by One Waiver................................................11
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ARTICLE VI MISCELLANEOUS........................................................................................11
SECTION 6.1. Term of This Agreement....................................................................11
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SECTION 6.2. Notices...................................................................................11
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SECTION 6.3. Binding Effect............................................................................12
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SECTION 6.4. Severability..............................................................................12
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SECTION 6.5. Amendments................................................................................12
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SECTION 6.6. Execution in Counterparts.................................................................12
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SECTION 6.7. Applicable Law............................................................................12
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SECTION 6.8. Captions..................................................................................12
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SECTION 6.9. Other Financing...........................................................................12
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LOAN AGREEMENT dated as of __________, between (the "Issuer"), a
___________ as defined in _________________________________ (the "Act"), and a
political subdivision of the State of ________, and SOUTHERN POWER COMPANY, a
corporation organized and existing under the laws of the State of Delaware and
qualified and doing business as an electric utility in the State of ________
(the "Company"), evidencing the agreement of the parties hereto.
In consideration of the respective representations and agreements
hereinafter contained, the parties hereto agree as follows (provided that in the
performance of the agreements of the Issuer herein contained, any obligation it
may thereby incur for the payment of money shall not be a general debt,
liability or obligation of the Issuer, or of the State of or any political
subdivision thereof but shall be payable solely out of the revenues and proceeds
derived from this Agreement and the Note (as hereinafter defined) and the sale
of the Bonds referred to herein):
ARTICLE I DEFINITIONS
"Bondholder", "Bonds", "Business Day", "Government Obligations", "Prior
Bonds Trustee", "Remarketing Agent" and "Trustee" have the same meanings given
and assigned to such words in Article I of the Indenture (as hereinafter
defined).
"Agreement" means this Loan Agreement and any amendments and
supplements hereto.
"Completion Date" means the date of completion of the acquisition,
construction, installation and equipping of the Project (hereinafter defined) as
such date shall be certified as provided in Section 2.3 hereof.
"corporation" includes corporations, partnerships, limited
partnerships, limited liability partnerships, limited liability companies,
associations, companies, statutory trusts and business trusts.
"Cost of Construction" with respect to the Project means the following:
(a) obligations of the Company incurred for labor and materials
(including reimbursements payable to the Company and payments on
contracts in the name of the Company) in connection with the
acquisition, construction, installation and equipping of the Project;
(b) the cost of contract bonds and of insurance of all kinds that may
be required or necessary during the course of construction of the
Project;
(c) all costs of engineering services, including the costs for test
borings, surveys, estimates, plans and specifications and preliminary
investigation therefor, and for supervising construction, as well as
for the performance of all other duties required by or consequent upon
the proper construction of the Project;
(d) overheads of the Company, to the extent not included in
subparagraph (c) above, allocable to the Project by the Company in
accordance with the Uniform System of Accounts prescribed for Public
Utilities and Licensees by the Federal Energy Regulatory Commission;
(e) interest to accrue in respect of the Bonds to the Completion Date,
amounts paid to the United States Treasury pursuant to Section
1.103-15AT(d) and (e) of the Temporary Regulations promulgated pursuant
to Section 148(f) of the Internal Revenue Code of 1986, as amended, or
any successor regulations, and all expenses incurred in connection with
the issuance of the Bonds, including without limitation initial
compensation and expenses of the Trustee, legal expenses and fees,
costs of printing and engraving, recording and filing fees,
compensation of the underwriters, if any, and rating agency fees;
(f) all other costs which the Company may properly pay or accrue for
the acquisition, construction, installation or equipping of the
Project;
(g) all costs incurred by the Company in the performance of its
obligation under Section 3.4 hereof; and
(h) any sums required to reimburse the Company for advances made for
any of the above items or for any other costs incurred or for work done
which are properly chargeable to the Project.
"Event of Default" means any of the occurrences enumerated in Section
5.1 of this Agreement.
"Indenture" means the Trust Indenture dated as of____________,
relating to ____________________ Revenue Bonds (Southern Power Company Project)
, between the Issuer and ________________ , as Trustee, pursuant to which the
Bonds are authorized to be issued, and including any indenture supplemental
thereto.
"Loan" means the loan to be made by the Issuer to the Company of the
proceeds (which shall be deemed to include the underwriting discounts, if any,
and original issue discount, if any) of the sale of the Bonds, exclusive of any
accrued interest paid by the initial purchasers of the Bonds upon the delivery
thereof.
"Note" means the non-negotiable promissory note of the Company issued
pursuant to Section 3.2 hereof, in the form set forth in Exhibit A hereto.
"Plans" means the plans and specifications prepared by or on behalf of
the Company for the Project, as the same may be revised from time to time by the
Company.
"Project" means the _______________________described in the Plans.
ARTICLE II ACQUISITION AND COMPLETION OF THE PROJECT; ISSUANCE OF THE BONDS
SECTION 2.1. Acquisition and Completion of the Project. The Company
agrees to use its best efforts to cause the acquisition, construction,
installation and equipping of the Project to be completed substantially in
accordance with the Plans as soon as practicable, delays incident to "force
majeure" (as defined in Section 5.1 hereof) only excepted. The Project shall
belong to and be the property of the Company.
The Issuer and the Company agree that the Company may from time to time
supplement or amend the Plans (including additions thereto or omissions
therefrom), provided that such supplements or amendments shall not result in the
interest on the Bonds or any portion thereof becoming includable in gross income
for federal income tax purposes under the laws then in effect.
SECTION 2.2. Issuance of the Bonds. In order to provide funds for
payment of a portion of the Cost of Construction, the Issuer agrees that it will
issue and deliver the Bonds to the purchasers thereof at a price to be approved
in advance by the Company and apply and deposit the proceeds thereof in
accordance with the terms of the Indenture. The Indenture shall be satisfactory
in form and substance to the Company and shall provide the manner in which, and
the purposes for which, proceeds of Bonds may be used and invested.
The Issuer has authorized and directed the Trustee to disburse moneys
from the Construction Fund in respect of the Cost of Construction in accordance
with Section 6.08 of the Indenture.
SECTION 2.3. Establishment of Completion Date. The Completion Date
shall be evidenced to the Trustee by a certificate of the Company: (i) stating
that the Project has been completed substantially in accordance with the Plans,
and (ii) stating that, except for amounts retained by the Trustee at the
Company's direction for any Cost of Construction not then due and payable or
which is in dispute, the entire Cost of Construction has been paid.
Notwithstanding the foregoing, such certificate shall state that it is given
without prejudice to any rights against third parties which exist at the date of
such certificate or which my subsequently come into being.
SECTION 2.4. Insufficiency of Construction Fund. The Issuer does not
make any warranty, either express or implied, that the amounts in the
Construction Fund and available for payment of the Cost of Construction will be
sufficient to pay all of the Cost of Construction. The Company agrees that, if
after exhaustion of the amounts in the Construction Fund, it should pay any
portion of the Cost of Construction, it shall not be entitled to any diminution
of the amounts payable under the Note and as provided in Section 3.2 hereof.
ARTICLE III LOAN BY ISSUER; PROVISIONS FOR PAYMENT
SECTION 3.1. Loan by Issuer. The Issuer hereby agrees to make the
Loan to the Company in order to finance the acquisition, construction,
installation and equipping of the Project.
SECTION 3.2. Delivery of Note by Company; Other Amounts Payable. In
order to evidence the Loan and the obligation of the Company to repay the same,
the Company shall execute and deliver the Note in a principal amount equal to
the aggregate principal amount of the Bonds and providing for payments which
correspond in time and amount with payments due with respect to the principal or
purchase price of, interest and premium, if any, on the Bonds, whether at
maturity, prior optional or mandatory redemption, or upon tender for purchase or
otherwise. The Note shall be dated the date of the initial authentication of,
and mature on the same maturity date as, the Bonds. If (i) on the date any
payments on the Bonds are due there are any available moneys on deposit with the
Trustee which are not being held for the payment of Bonds due and payable but
which have not been presented for payment, or (ii) on any date on which Bonds
are required to be purchased pursuant to the Bonds or Article III of the
Indenture, there are available moneys on deposit with the Trustee held for the
payment of the purchase price which are not being held for the payment of Bonds
which have not been presented for payment, then, in each case, such moneys shall
be credited against the payment then due under the Note, first in respect of
interest and then, to the extent of remaining moneys, in respect of principal.
The Company shall pay all reasonable costs and expenses incurred in
connection with the issuance of the Bonds and the execution, delivery and
performance of the Agreement, the Indenture and any other documents or
instruments related thereto or to the Bonds, to which the Issuer is a party or
by which it is bound, including, without limitation, the reasonable fees of the
Issuer's financial advisor and bond counsel. The Company will also pay: (i) the
fees, charges and reasonable expenses of the Trustee and any paying agents under
the Indenture, such fees, charges and reasonable expenses to be paid directly to
the Trustee or paying agents for their respective accounts as and when such
fees, charges and reasonable expenses become due and payable, (ii) any expenses
in connection with any redemption of the Bonds and (iii) all other amounts due
under the terms hereof to the Issuer.
SECTION 3.3. Obligation of the Company Unconditional. The obligation of
the Company to make payments as provided in the Note and to perform and observe
the other agreements on its part contained herein shall be absolute and
unconditional notwithstanding any change in the tax or other laws of the United
States of America or of the State of ________ or any political subdivision of
either thereof or any failure of the Issuer to perform and observe any
agreement, whether express or implied, or any duty, liability or obligation
arising out of or connected with this Agreement. Subject in all cases to Section
4.2 hereof, nothing contained in this Section 3.3 shall be construed to release
the Issuer from the performance of any of the agreements on its part herein
contained; and, in the event the Issuer should fail to perform any such
agreement on its part, the Company may institute such action against the Issuer
as the Company may deem necessary to compel performance so long as such action
shall not violate the agreements on the part of the Company contained in the
preceding sentence, but in no event shall the Company be entitled to any
diminution of the amounts payable under the Note and as provided in Section 3.2
hereof.
SECTION 3.4. Assignment and Pledge of Payments and Rights Under the
Note and the Agreement. The Issuer shall assign to the Trustee as security under
the Indenture all rights, title and interests of the Issuer in and to (i) the
Note and all payments thereunder and (ii) this Agreement and all moneys
receivable hereunder (except for payments under Sections 4.2 and 5.3 hereof).
The Company assents to such assignment and hereby agrees that, as to the
Trustee, its obligations to make such payments shall be absolute and shall not
be subject to any defense or any right of set-off, counterclaim or recoupment
arising out of any breach by the Issuer or the Trustee of any obligation to the
Company, whether hereunder or otherwise, or out of any indebtedness or liability
at any time owing to the Company by the Issuer or the Trustee.
ARTICLE IV SPECIAL COVENANTS
SECTION 4.1. Use of Project. The Issuer hereby acknowledges that it
shall have no rights to the use or possession of the Project. The Issuer hereby
further acknowledges that the Project will not constitute any part of the
security for the Bonds.
SECTION 4.2. Indemnity Against Claims.
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(a) Notwithstanding anything to the contrary contained herein or in any
of the Bonds, the Indenture or in any other instrument or document executed by
or on behalf of the Issuer in connection herewith, (i) the Issuer shall have no
obligation to take action under this Agreement, the Indenture, the Bonds or such
other instruments or documents unless the Issuer is reasonably requested in
writing by an appropriate person to take such action and is provided with
indemnity and assurances reasonably satisfactory to it of payment of or
reimbursement for any expenses (including attorneys' fees) in such action, and
(ii) any judgment rendered against the Issuer for breach of its obligations
under this Agreement, the Indenture, the Bonds or such other instruments or
documents shall be payable solely from the revenues derived from the Project by
the Issuer under this Agreement, the Note and the Indenture, and no personal
liability or charge payable directly or indirectly from the general funds of the
Issuer shall arise therefrom. The provisions of this Section shall survive the
termination of this Agreement.
(b) In acting under this Agreement, the Indenture, the Bonds or such
other instruments or documents, or in refraining from taking such action, the
Issuer may conclusively rely on the advice of its counsel.
(c) The Company will pay and discharge and will indemnify and hold
harmless the Issuer from (i) any lien or charge upon payments by the Company to
the Issuer under the Note or hereunder, (ii) any taxes, assessments, impositions
and other charges upon payments by the Company to the Issuer under the Note or
hereunder and (iii) any and all liability, damages, costs and expenses arising
out of or resulting from the transactions contemplated by this Agreement and the
Indenture, including the reasonable fees and expenses of counsel. If any such
lien or charge is sought to be imposed upon payments, or any such taxes,
assessments, impositions or other charges are sought to be imposed, or any such
liability, damages, costs and expenses are sought to be imposed, the Issuer will
give prompt notice to the Company, and the Company shall have the sole right and
duty to assume, and will assume, the defense thereof, with full power to
litigate, compromise or settle the same in its sole discretion.
SECTION 4.3. The Company to Maintain Its Corporate Existence;
Conditions Under Which Exceptions Permitted. The Company agrees that during the
term of this Agreement it will maintain its corporate existence and
qualification to do business in ________, will not dissolve or otherwise dispose
of all or substantially all of its assets and will not consolidate with or merge
into another corporation or permit one or more other corporations to consolidate
with or merge into it; provided, that the Company may, without violating the
agreements contained in this Section 4.3, consolidate with or merge into another
domestic corporation (i.e., a corporation incorporated and existing under the
laws of one of the states of the United States of America or under the laws of
the United States of America) or permit one or more other corporations to
consolidate with or merge into it, or sell or otherwise transfer to another
domestic corporation all or substantially all of its assets as an entirety and
thereafter dissolve, provided that, in the event the Company is not the
surviving, resulting or transferee corporation, as the case may be, the
surviving, resulting or transferee corporation assumes, accepts and agrees in
writing to pay and perform all of the obligations of the Company herein and
under the Note and is a ________ corporation or is qualified to do business in
________ as a foreign corporation and that such consolidation or merger does not
result in the loss of the exclusion from gross income for federal income tax
purposes of interest on the outstanding Bonds.
SECTION 4.4. Annual Statement. The Company agrees to have an annual
audit made by its regular independent public accountants and within 180 days
after the close of each fiscal year to furnish the Trustee and any Bondholder
who may so request a balance sheet and statement of income and surplus showing
the financial condition of the Company and its consolidated subsidiaries, if
any, at the close of such fiscal year and the results of operations of the
Company and its consolidated subsidiaries, if any, for such fiscal year,
accompanied by a certificate or opinion of said accountants. The requirements of
this Section 4.4 may be satisfied by the submission to the Trustee and each
Bondholder who may request such information of the Company's annual report to
its shareholders.
SECTION 4.5. Further Assurances and Corrective Instruments. The Issuer
and the Company agree that they will, from time to time, execute, acknowledge
and deliver, or cause to be executed, acknowledged and delivered, such
supplements hereto and such further instruments as may reasonably be required
for correcting any inadequate or incorrect description of the Project and for
carrying out the intention or facilitating the performance of this Agreement.
SECTION 4.6. Maintenance of Project by Company. The Company agrees that
during the term of this Agreement it will pay all costs of operating,
maintaining and repairing the Project; provided, however, that the Company shall
not be under any obligation to renew, repair or replace any inadequate,
obsolete, worn-out, unsuitable, undesirable or unnecessary portion of the
Project.
SECTION 4.7. Redemption or Purchase of Bonds. The Issuer shall take all
steps then necessary under the applicable provisions of the Indenture for the
redemption or purchase (other than a purchase pursuant to tenders as provided in
the form of Bonds or in lieu of redemption as provided in Section 3.07 of the
Indenture) of Bonds upon receipt, not less than ten days prior to the day on
which the Trustee is required to give notice (if any) thereof pursuant to the
Indenture, by the Issuer and the Trustee from the Company of a written notice
specifying:
(a) the principal amount of Bonds to be redeemed or purchased;
(b) the date of such redemption or purchase; and
(c) in the case of a redemption of Bonds, directions to mail a
notice of redemption.
In the case of a purchase of Bonds, the written notice to the Trustee shall, if
available moneys on deposit with the Trustee are insufficient to purchase the
principal amount of Bonds specified in (a) above, be accompanied by a deposit
with the Trustee of cash or Government Obligations sufficient, together with
other available moneys on deposit with the Trustee, to make the directed
purchase of Bonds.
SECTION 4.8. Non-Arbitrage Covenant. The Company covenants that it
shall take no action, nor shall the Company direct the taking of any action or
the making of any investment or use of the proceeds of the Bonds or any other
moneys, which would cause the Bonds to be treated as "arbitrage bonds" within
the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, and
the proposed, temporary or final regulations thereunder as such may be
applicable or proposed to be applicable to the Bonds at the time of such action,
investment or use.
The Issuer covenants that it shall not knowingly take any action which
would cause the Bonds to be treated as "arbitrage bonds" within the meaning of
Section 148 of the Internal Revenue Code of 1986, as amended, and the proposed,
temporary or final regulations thereunder as such may be applicable to the Bonds
or the proceeds derived from the sale of the Bonds or any other moneys;
provided, however, that no action taken by the Issuer pursuant to and in
accordance with the terms of this Agreement or the Indenture shall give rise in
any manner whatsoever to any claim against or liability of the Issuer under this
Agreement; and provided further, that any such claims or liabilities shall in
all events be subject to the indemnification provisions of Section 4.2.
Without limiting the generality of the foregoing, the Company covenants
and agrees to comply with the requirements of Section 148(f) of the Internal
Revenue Code of 1986, as amended, and any proposed, temporary or final
regulations thereunder as may be applicable to the Bonds or the proceeds derived
from the sale of the Bonds or any other moneys.
SECTION 4.9. No Issuer Liability. Notwithstanding the fact that it is
the intention of the parties hereto that the Issuer shall not incur any loss,
expense or pecuniary liability by reason of the terms of this Agreement or the
undertakings required of the Issuer hereunder, by reason of the issuance of the
performance of any act requested of the Issuer by the Company, including all
claims, liabilities or losses arising in connection with the violation of any
statutes or regulation pertaining to the foregoing, if the Issuer should incur
any such loss, expense or pecuniary liability, then in such event the Company
shall indemnify and hold the Issuer harmless against all claims, demands or
causes of action whatsoever, by or on behalf of any person, firm or corporation
or other legal entity arising out of the same or out of any offering statement
or lack of offering statement or disclosure in connection with the offering,
sale or remarketing of the Bonds or out of any determination of taxability of
the Bonds or interest thereon and all costs and expenses incurred in connection
with any such claim or in connection with any action or proceeding brought
thereon, and upon notice from the Issuer, the Company shall defend the Issuer in
any such action or proceeding. All references to the Issuer in this Section
shall be deemed to include its Board of County Commissioners, Commission
Members, officers, employees and agents.
Notwithstanding anything to the contrary contained herein or in any of
the Bonds, or the Indenture or in any other instrument or document executed by
or on behalf of the Issuer in connection herewith, no stipulation, covenant,
agreement or obligation contained herein or therein shall be deemed or construed
to be a stipulation, covenant, agreement or obligation of any present or future
member, officer, employee or agent of the Issuer, or of any incorporator,
member, director, trustee, officer, employee or agent of any successor to the
Issuer, in any such person's individual capacity, and no such person, in his
individual capacity, shall be liable personally for any breach or non-observance
of or for any failure to perform, fulfill or comply with any such stipulations,
covenants, agreements or obligations, nor shall any recourse be had for the
payment of the principal of, premium, if any, or interest on any of the Bonds or
for any claim based thereon or on any such stipulation, covenant, agreement or
obligation, against any such person, in his individual capacity, either directly
or through the Issuer or any successor to the Issuer, under any rule of law or
equity, statute or constitution or by the enforcement of any assessment or
penalty or otherwise, and all such liability of any such person, in his
individual capacity, is hereby expressly waived and released. The provisions of
this Section shall survive the termination of this Agreement.
SECTION 4.10 Post Issuance Audits. The Company agrees to provide such
records regarding the Project and the use, investment and application of
proceeds of the Bonds as may reasonably be requested by the County to enable the
County to determine that the Company has complied with the requirements of this
Agreement and the Indenture subsequent to the issuance of the Bonds. Such
compliance shall include, but not be limited to, the proper use of the Bonds
proceeds for the intended purposes of the Indenture and this Agreement and
compliance with any federal arbitrage rebate requirements. The Company agrees to
advance all funds necessary to enable the County to engage and pay for such
auditors, accountants, financial advisors, counsel or other professionals for
purposes of reasonably determining such compliance.
ARTICLE V EVENTS OF DEFAULT AND REMEDIES
SECTION 5.1. Events of Default. Each of the following shall be an "Event of
Default" under this Agreement:
(a) Failure by the Company to pay when due the amounts
required to be paid pursuant to the Note which failure, in the case of
such amounts in respect of interest on any Bond, continues for five
days, or the failure by the Company to pay within 30 days of the date
due any other amounts required to be paid pursuant to this Agreement.
(b) Failure by the Company to observe and perform any
covenant, condition or agreement on its part to be observed or
performed hereunder, other than as referred to in subsection (a) of
this Section 5.1, for a period of 90 days after written notice,
specifying such failure and requesting that it be remedied, is given to
the Company by the Issuer or the Trustee, unless the Issuer and the
Trustee shall agree in writing to an extension of such period prior to
its expiration; provided, however, if the failure stated in the notice
cannot be corrected within the applicable period, the Issuer and the
Trustee will not unreasonably withhold their consent to an extension of
such period if corrective action is instituted by the Company within
the applicable period and diligently pursued until the default is
corrected.
(c) The dissolution or liquidation of the Company, except as
permitted by Section 4.3 hereof, or the commencement by the Company of
any case or proceeding seeking to have an order for relief entered on
its behalf as a debtor or to adjudicate it as bankrupt or insolvent or
seeking reorganization, liquidation, dissolution, winding-up,
arrangement, composition, readjustment of its debts or any other relief
under any bankruptcy, insolvency, reorganization or other similar law
of the United States or any state, or adjudication of the Company as
bankrupt, or an assignment by the Company for the benefit of its
creditors, or the entry by the Company into an agreement of composition
with its creditors, or the approval by a court of competent
jurisdiction of a petition applicable to the Company in any proceeding
for its reorganization instituted under the provisions of Title 11 of
the United States Code, as amended, or under any similar statutory
provision which may hereafter be enacted.
The foregoing provisions of Section 5.1(b) are subject to the limitation that,
if by reason of force majeure the Company is unable in whole or in part to carry
out its agreements herein contained other than those set forth in Sections 3.2,
4.3 and 4.8 hereof, an Event of Default shall not be deemed to have occurred
during the continuance of such inability. The term "force majeure" as used
herein shall mean the following: acts of God; strikes; lockouts or other
industrial disturbances; acts of public enemies; orders of any kind of the
government of the United States or of the State of ________ or any of their
departments, agencies or officials or of any civil or military authority;
insurrections; riots; epidemics; landslides; lightning; earthquakes; fire;
hurricanes; tornadoes; storms; floods; washouts; droughts; arrests; restraints
of government and people; civil disturbances; explosions; breakage or accident
to machinery, transmission lines, pipes or canals; partial or entire failure of
utilities; or any other cause or event not reasonably within the control of the
Company. The Company agrees, however, to remedy to the extent practicable with
all reasonable dispatch the effects of any force majeure preventing the Company
from carrying out its agreements; provided that the settlement of strikes,
lockouts and other industrial disturbances shall be entirely within the
discretion of the Company, and the Company shall not be required to make
settlement of strikes, lockouts and other industrial disturbances by acceding to
the demands of the opposing party or parties when such course is in the judgment
of the Company unfavorable to the Company.
SECTION 5.2. Remedies on Default. Whenever any Event of Default shall
have occurred and be continuing, the Issuer may, in addition to any other remedy
now or hereafter existing at law, in equity or by statute, take either or both
of the following remedial steps:
(a) By written notice to the Company, the Issuer may
accelerate and declare all amounts payable pursuant to the Note to be
immediately due and payable, whereupon the same shall become
immediately due and payable; and
(b) The Issuer may take whatever action at law or in equity
may appear necessary or desirable to collect the amounts referred to in
(a) above then due and thereafter to become due, or to enforce
performance and observance of any obligation, agreement or covenant of
the Company under this Agreement.
Any amounts collected pursuant to action taken under this Section 5.2 shall be
deposited with the Trustee and applied in accordance with the provisions of the
Indenture or, if the Bonds have been fully paid (or provision for payment
thereof has been made in accordance with the provisions of the Indenture) and
the fees and expenses of the Trustee and the paying agents and all other amounts
required to be paid under the Indenture shall have been paid, returned to the
Company.
SECTION 5.3. Agreement to Pay Attorneys' Fees and Expenses. In the
event the Company should breach any of the provisions of the Note or this
Agreement and the Issuer or the Trustee should employ attorneys or incur other
expenses for the collection of amounts payable hereunder or the enforcement of
performance or observance of any obligation or agreement on the part of the
Company herein contained, the Company agrees that it will on demand therefor pay
to the Issuer the reasonable fees of such attorneys and such other reasonable
expenses so incurred by the Issuer or the Trustee.
SECTION 5.4. No Additional Waiver Implied by One Waiver. In the event
any agreement contained in the Note or in this Agreement should be breached by
either party and thereafter waived by the other party, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive any
other breach hereunder.
ARTICLE VI MISCELLANEOUS
SECTION 6.1. Term of This Agreement. Except as otherwise expressly
provided herein, this Agreement shall remain in full force and effect from the
date hereof until such time as all of the outstanding Bonds shall have been
fully paid or provision made therefor in accordance with the provisions of the
Indenture, whichever shall first occur, and the fees and expenses of the Trustee
and any paying agents and all other amounts payable by the Company under this
Agreement and the Note shall have been paid.
SECTION 6.2. Notices. All notices, certificates or other communications
hereunder shall be sufficiently given and shall be deemed given when delivered
or mailed by registered or certified mail, postage prepaid, addressed as
follows: if to the Issuer, to, ; if to the Company and via United States mail at
, Attention: , with copies to Southern Company Services, Inc., , Attention:
Corporate Finance Department; if to the Company and via hand delivery at ,
Attention: , with copies to Southern Company Services, Inc., , Attention:
Corporate Finance Department; and if to the Trustee, at , Attention: . A
duplicate copy of each notice, certificate or other communication given
hereunder by either the Issuer or the Company to the other shall also be given
to the Trustee. The Issuer, the Company and the Trustee may, by notice given
hereunder, designate any further or different addresses to which subsequent
notices, certificates or other communications shall be sent.
SECTION 6.3. Binding Effect. This Agreement shall inure to the benefit
of and shall be binding upon the Issuer, the Company and their respective
successors and assigns, subject, however, to the limitations contained in
Section 4.3 hereof.
SECTION 6.4. Severability. In the event any provision of this Agreement
shall be held invalid or unenforceable by any court of competent jurisdiction,
such holding shall not invalidate or render unenforceable any other provision
hereof.
SECTION 6.5. Amendments. This Agreement may not be effectively
terminated except in accordance with the provisions hereof and may not be
effectively amended except by a written agreement in accordance with Article XI
of the Indenture and signed by the parties hereto.
SECTION 6.6. Execution in Counterparts. This Agreement may be executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.
SECTION 6.7. Applicable Law. This Agreement and the Note shall be
governed by and construed in accordance with the laws of the State of ________.
SECTION 6.8. Captions. The captions or headings in this Agreement
are for convenience only and in no way define, limit or describe the scope or
intent of any provisions or sections of this Agreement.
SECTION 6.9. Other Financing. Notwithstanding anything in this
Agreement to the contrary, the Issuer and the Company may hereafter enter into
agreements to provide for the financing or refinancing of costs of the Project
or any portion thereof.
IN WITNESS WHEREOF, the Issuer and the Company have caused this
Agreement to be executed in their respective corporate names and their
respective corporate seals to be hereunto affixed and attested by their duly
authorized officers, all as of the date first above written.
[SEAL] By:
ATTEST:
SOUTHERN POWER COMPANY
[SEAL] By: Title:
ATTEST:
Title:
EXHIBIT A
SOUTHERN POWER COMPANY
PROMISSORY NOTE
SOUTHERN POWER COMPANY ("Southern Power"), a corporation organized and
existing under the laws of the State of Delaware, acknowledges itself indebted
and for value received hereby promises to pay to the order of
(the "County"), and its successors and assigns, the principal sum of
_____________DOLLARS ($ ) together with interest on the unpaid principal
balance thereof from the date ______________hereof until Southern Power's
obligations with respect to the payment of such
sum shall be discharged at the rate or rates borne by the Bonds referred to
below. As additional interest hereon there shall be payable, and Southern Power
promises to pay when due, amounts which shall equal the premium, if any, due on
such Bonds in connection with the redemption thereof. Southern Power further
promises to pay the purchase price of such Bonds as hereinbelow provided.
This Note is issued to evidence the Loan (as defined in the Agreement
hereinafter referred to) of the County to Southern Power and the obligation of
Southern Power to repay the same and shall be governed by and be payable in
accordance with the terms and conditions of a loan agreement (the "Agreement")
between the County and Southern Power dated as of , 20 , pursuant to which the
County has loaned to Southern Power the proceeds of the sale of the County's $
of Revenue Bonds (Southern Power Company Project ), (the "Bonds"). This Note
(together with the Agreement) has been assigned to (the "Trustee"), acting
pursuant to a trust indenture dated as of , 20 (the "Indenture") between the
County and the Trustee, and may not be assigned by the Trustee except to a
successor Trustee pursuant to the terms of the Indenture. Such assignment is
made as security for the Bonds. The Bonds are dated and bear interest in
accordance with the provisions of the Indenture, and mature on , 20 . The Bonds
are subject to redemption or prior purchase prior to maturity as provided
therein.
Subject to the provisions of the Agreement, payments hereon are to be
made by paying to the Trustee, as assignee of the County, in funds which will be
immediately available on the day payment is due, amounts which, and at or before
times which, shall correspond to the payments with respect to the principal of
and premium, if any, and interest on the Bonds whenever and in whatever manner
the same shall become due, whether at stated maturity, upon redemption or
declaration or otherwise, and the purchase price of Bonds required to be
purchased under the Indenture. If (i) on the date any payments on the Bonds are
due there are any available moneys on deposit with the Trustee which are not
being held for the payment of Bonds due and payable but which have not been
presented for payment, or (ii) on any date on which Bonds are required to be
purchased pursuant to the Bonds or Article III of the Indenture, there are
available moneys on deposit with the Trustee held for the payment of the
purchase price which are not being held for the payment of Bonds which have not
been presented for payment, then, in each case, such moneys shall be credited
against the payment then due hereunder, first in respect of interest and then,
to the extent of remaining moneys, in respect of principal. Upon the occurrence
of an Event of Default, as defined in the Agreement, the principal of and
interest on this Note may be declared immediately due and payable as provided in
the Agreement.
Neither the officers of Southern Power nor any persons executing this
Note shall be liable personally or shall be subject to any personal liability or
accountability by reason of the issuance hereof.
IN WITNESS WHEREOF, Southern Power Company has caused this Note to be
executed in its corporate name and on its behalf by its President, its Treasurer
or a Vice President by his manual signature, and its corporate seal to be
impressed hereon and attested by the manual signature of its Secretary or an
Assistant Secretary, all as of the date first above written.
SOUTHERN POWER COMPANY
By:
-----------------
Attest:
-----------------
ASSIGNMENT
Pay, without recourse, to the order of ____________ , as assignee of
under the Trust Indenture, dated as of , 20 , between________
and ____________________________ , as Trustee, securing the payment of
Revenue Bonds (Southern Power Company Project), in the original principal
amount of $ ___________________.
By:
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