exv10w15



 






Exhibit 10.15




 





LOAN AGREEMENT




Between




MITCHELL COUNTY DEVELOPMENT AUTHORITY




and




FIRST UNITED ETHANOL, LLC




********************************************************************




$29,000,000




VARIABLE RATE DEMAND

SOLID WASTE DISPOSAL REVENUE BONDS

(FIRST UNITED ETHANOL, LLC PROJECT), SERIES 2006




********************************************************************




Dated as of October 1, 2006



Certain of the interests of the Mitchell County Development Authority in this Loan Agreement have
been assigned to Wells Fargo Bank, National Association as Trustee under the Trust Indenture dated
as of October 1, 2006.



 





 









 








INDEX

(The Index is not a part of the Agreement

but for convenience of reference only.)




	 	 	 	 	 	 	 
	 	 	 	 	Page
	Preambles
	 	 
	 	 	1	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE I
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	DEFINITIONS
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 1.1
	 	General

	 	 	1	 
	Section 1.2
	 	Definitions

	 	 	1	 
	Section 1.3
	 	No Constitutional Debt

	 	 	5	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE II
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	THE LOAN; LOAN PAYMENTS; LETTER OF CREDIT
	 	 	 	 
	 	 	AND ADDITIONAL PAYMENTS;
	 	 	 	 
	 	 	BORROWER EXECUTIVE AND DELIVER NOTE
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 2.1
	 	Amount and Terms of the Loan; the Note

	 	 	5	 
	Section 2.2
	 	Additional Payments

	 	 	6	 
	Section 2.3
	 	Notes

	 	 	6	 
	Section 2.4
	 	Assignment of Payments and Note

	 	 	8	 
	Section 2.5
	 	Obligations Unconditional

	 	 	8	 
	Section 2.6
	 	Prepayment of Loan and Additional Payments; Moneys for Optional Redemption

	 	 	9	 
	Section 2.7
	 	Past Due Loan Payments and Additional Payments

	 	 	9	 
	Section 2.8
	 	Redemption of Bonds

	 	 	9	 
	Section 2.9
	 	Adjustment of Loan Payments in the Event of Redemption or Cancellation
Of Project Bonds

	 	 	9	 
	Section 2.10
	 	Assignment of Agreement and Revenues

	 	 	9	 
	Section 2.11
	 	Payments to Remarketing Agent

	 	 	9	 
	Section 2.12
	 	Letter of Credit and Confirming Letter of Credit; Alternate Letter of Credit and
Alternate Confirming Letter of Credit

	 	 	9	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE III
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	ACQUISITION, CONSTRUCTION, EQUIPPING AND
	 	 	 	 
	 	 	OWNERSHIP OF THE PROJECT
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 3.1
	 	Agreement to Acquire, Construct and Equip The Project

	 	 	10	 
	Section 3.2
	 	Completion Date

	 	 	11	 
	Section 3.3
	 	Agreement as to Ownership of Project

	 	 	11	 
	Section 3.4
	 	Use of Project

	 	 	11	 
	Section 3.5
	 	Additional Bonds

	 	 	11	 






i 









 






	 	 	 	 	 	 	 
	 	 	 	 	Page
	 	 	 
	 	 	 	 
	 	 	ARTICLE IV
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	ISSUANCE OF BONDS;
	 	 	 	 
	 	 	APPLICATION OF PROCEEDS
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 4.1
	 	Issuance of Bonds; Deposit of Bond Proceeds

	 	 	11	 
	Section 4.2
	 	Disbursements from the Project Fund

	 	 	11	 
	Section 4.3
	 	Obligation of the Parties to Cooperate In Furnishing Documents

	 	 	13	 
	Section 4.4
	 	Borrower Required to Pay Costs in Event Project Fund Insufficient

	 	 	13	 
	Section 4.5
	 	Investment of Fund Moneys

	 	 	13	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE V
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	MAINTENANCE; INSURANCE; DAMAGE;
	 	 	 	 
	 	 	DESTRUCTION AND EMINENT DOMAIN
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 5.1
	 	Maintenance

	 	 	13	 
	Section 5.2
	 	Removal of Portions of Project

	 	 	14	 
	Section 5.3
	 	Option to Release Portion of Project

	 	 	14	 
	Section 5.4
	 	Insurance Required

	 	 	14	 
	Section 5.5
	 	[Reserved]

	 	 	14	 
	Section 5.6
	 	Worker’s Compensation

	 	 	14	 
	Section 5.7
	 	Mechanic’s Liens

	 	 	14	 
	Section 5.8
	 	Damage, Destruction and Eminent Domain

	 	 	14	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE VI
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	WARRANTIES, REPRESENTATIONS AND COVENANTS
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 6.1
	 	Representations of the Issuer

	 	 	15	 
	Section 6.2
	 	Representations of the Borrower

	 	 	15	 
	Section 6.3
	 	[Reserved]

	 	 	16	 
	Section 6.4
	 	Financial Statements

	 	 	16	 
	Section 6.5
	 	Borrower’s Approval of Indenture

	 	 	16	 
	Section 6.6
	 	Right of Access

	 	 	16	 
	Section 6.7
	 	Indemnification

	 	 	16	 
	Section 6.8
	 	Borrower Not to Adversely Affect Tax Exempt Status of Bond Interest
On Project Bonds

	 	 	17	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE VII
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	ASSIGNMENT
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 7.1
	 	Assignment by Borrower

	 	 	17	 
	Section 7.2
	 	Assignment by Issuer

	 	 	17	 






ii 









 






	 	 	 	 	 	 	 
	 	 	 	 	Page
	 	 	 
	 	 	 	 
	 	 	ARTICLE VIII
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	TERMINATION AND PREPAYMENT
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 8.1
	 	Option to Terminate

	 	 	18	 
	Section 8.2
	 	Option to Prepay Loan

	 	 	18	 
	Section 8.3
	 	Obligation to Prepay Loan

	 	 	18	 
	Section 8.4
	 	Notice of Prepayment

	 	 	19	 
	Section 8.5
	 	Prepayment Price

	 	 	19	 
	Section 8.6
	 	Relative Position of this Article and Indenture

	 	 	19	 
	Section 8.7
	 	Concurrent Discharge of Note

	 	 	19	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE IX
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	EVENT OF DEFAULT AND REMEDIES
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 9.1
	 	Events of Default

	 	 	20	 
	Section 9.2
	 	Remedies on Default

	 	 	21	 
	Section 9.3
	 	No Remedy Exclusive

	 	 	21	 
	Section 9.4
	 	Agreement to Pay Attorneys’ Fees and Expenses

	 	 	21	 
	Section 9.5
	 	No Additional Waiver Implied by One Waiver

	 	 	22	 
	 	 	 
	 	 	 	 
	 	 	ARTICLE X
	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	MISCELLANEOUS
	 	 	 	 
	 	 	 
	 	 	 	 
	Section 10.1
	 	Term of Agreement

	 	 	22	 
	Section 10.2
	 	Amounts Remaining in Bond Fund

	 	 	22	 
	Section 10.3
	 	Notices

	 	 	22	 
	Section 10.4
	 	Binding Effect

	 	 	22	 
	Section 10.5
	 	Amendments, Changes and Modifications

	 	 	22	 
	Section 10.6
	 	Counterparts

	 	 	22	 
	Section 10.7
	 	Severability

	 	 	22	 
	Section 10.8
	 	Captions

	 	 	23	 
	Section 10.9
	 	Governing Law

	 	 	23	 
	Section 10.10
	 	Selection of Alternate Letter of Credit

	 	 	23	 
	Section 10.11
	 	Continuing Obligation

	 	 	23	 
	Section 10.12
	 	Limitation on Issuer’s Liability

	 	 	23	 
	 	 	 
	 	 	 	 
	Signature	 	 	24	 
	 	 	 
	 	 	 	 
	Exhibit A Form of Promissory Note	 	A-1

	 	 	 
	 	 	 	 
	Exhibit B Project	 	B-1

	 	 	 
	 	 	 	 
	Exhibit C Project Site Description	 	C-1







iii 









 






L O A N    A G R E E M E N T




Between




MITCHELL COUNTY DEVELOPMENT AUTHORITY




and




FIRST UNITED ETHANOL, LLC




     THIS LOAN AGREEMENT made and entered into as of the 1st day of October, 2006, between the
MITCHELL COUNTY DEVELOPMENT AUTHORITY, a public body corporate and politic and an instrumentality
of Mitchell County, Georgia, created under the Constitution and laws of the State of Georgia
(hereinafter called the “Issuer”), and FIRST UNITED ETHANOL, LLC, a Georgia limited liability
company (hereinafter called the “Borrower”),



W I T N E S S E T H




     WHEREAS, the Act provides, among other things, for the issuance of revenue bonds to provide
funds to make loans to others to purchase, construct, reconstruct, enlarge, improve, furnish and
equip real or personal property or both, or interests therein, to serve a public purpose and to
benefit the health or general welfare of the State; and



     WHEREAS, the Borrower and the Issuer each have full right and lawful authority to enter into
this Loan Agreement (hereinafter called the “Agreement”, and, when the context permits, references
herein to the Agreement shall be deemed to include the Agreement as the same may be duly amended,
modified or supplemented in accordance with the provisions hereof) and to perform and observe the
provisions hereof on their respective parts to be performed and observed;



     NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter
contained, the parties hereto covenant, agree and bind themselves as follows:



ARTICLE I




DEFINITIONS




     Section 1.1. General. In addition to the words and terms elsewhere defined in this
Agreement, certain words and terms as used in this Agreement shall have the meanings given to them
by the definitions and descriptions in this Article I unless the context or use indicates another
or different meaning or intent and such definitions shall be equally applicable to both the
singular and plural forms of any of the words and terms herein defined. Those words and terms not
specifically defined herein and used in this Agreement and Article I as defined words or terms
shall have the meanings set forth in Section 1.01 of the Indenture (as defined herein).



     Section 1.2. Definitions. The following words and terms are defined terms under
this Agreement:



     “Act” has the definition assigned thereto in the Indenture.



1









 





     “Additional Payments” means the amounts required to be paid by the provisions of Section 2.2
of this Agreement.



     “Agreement” means this Loan Agreement between the Issuer and the Borrower, dated as of October
1, 2006, as the same may be duly amended, modified or supplemented in accordance with the
provisions hereof.



     “Alternate Confirming Letter of Credit” means a Confirming Letter of Credit delivered to the
Trustee pursuant to Section 2.12 of this Agreement to replace the Confirming Letter of Credit then
in effect.



     “Alternate Letter of Credit” means a Letter of Credit delivered to the Trustee pursuant to
Section 2.12 of this Agreement to replace the Letter of Credit then in effect.



     “Bank” has the meaning ascribed to such term in the Indenture.



     “Bonds” means the Project Bonds and any Additional Bonds issued and to be issued pursuant to
the Indenture.



     “Bond Fund Payment” means as to the Project Bonds an amount, if any, equal to the interest
accrued on the Project Bonds from their date to the date of their delivery to the Original
Purchaser and payment therefor, and as to the Additional Bonds the amount specified in the Bond
Resolution authorizing such Additional Bonds, provided that the Bond Fund Payment for any
Additional Bonds shall not be less than an amount equal to the interest accrued on such Additional
Bonds from their date to the date of delivery of such Additional Bonds to their original purchaser
and payment therefor.



     “Bond Redemption Date” means any date, other than an Interest Payment Date, upon which Bonds
shall be redeemed pursuant to the Indenture.



     “Bond Service Charges” for any time period or with respect to any date means the principal,
including interest and redemption premium, if any, required to be paid on the Bonds for such time
period or on such date.



     “Borrower” means First United Ethanol, LLC, a Georgia limited liability company, and its
successors and assigns, including any transferee partnership, corporation or other entity.



     “Chair” means the Chairman or Acting Chairman of the Board of the Issuer.



     “Code” means the Internal Revenue Code of 1986, as amended. Each reference to a section of the
Code herein shall be deemed to include the United States Treasury Regulations proposed or in effect
with respect thereto and applicable to the Bonds or the use of the proceeds thereof.



     “Completion Date” means the date by which acquisition and installation of the Project is
completed, with such completion to be evidenced by the certificate of the Authorized Borrower
Representative to be furnished with respect to the Project pursuant to Section 3.3 of this
Agreement.



     “Confirming Bank” has the meaning ascribed to such term in the Indenture.



     “Confirming Letter of Credit has the meaning ascribed to such term in the Indenture.



2









 





     “Construction Period” means the period between the date on which the Project Bonds are
delivered to the Original Purchaser and the Completion Date.



     “Fixed Term” means the period from the Conversion Date through the Maturity Date.



     “Indenture” means the Trust Indenture between the Issuer and the Trustee relating to the
issuance of the Project Bonds, dated as of October 1, 2006, as amended or supplemented from time to
time.



     “Independent Counsel” means any attorney or firm of attorneys acceptable to the Trustee and to
the Issuer and who is not an officer, partner or a full-time employee of the Issuer or the
Borrower, and in the case of a firm, none of the attorneys or members of which is an officer,
partner or a full-time employee of the Issuer or the Borrower.



     “Interest Rate for Advances” means the Default Interest Rate (as defined in the Reimbursement
Agreement), but in no event in excess of the highest annual rate of interest allowable by law;
provided, however, that anything herein to the contrary notwithstanding the rate of interest on any
Loan Payment in default shall not be less than the rate of interest on the Bonds to which such Loan
Payment relates.



     “Issuer” has the meaning assigned thereto in the Indenture.



     “Issuer’s Fee” means the annual administrative fee of the Issuer in the amount of one-eight of
one percent (1/8 of 1.00%) of the then Outstanding face amount of the bonds, initially due and
payable on the date that the Bonds are issued and due and payable annually thereafter on October 1
of each calendar year that the Bonds are outstanding.



     “Letter of Credit” has the meaning assigned thereto in the Indenture.



     “Loan” means the loan by the Issuer to the Borrower of the proceeds from the sale of the
Project Bonds to the Original Purchaser as the same may hereafter be increased from the proceeds
from the sale of Additional Bonds.



     “Loan Payment Date” means each Bond Redemption Date, each Interest Payment Date, each
Principal Payment Date, each Mandatory Redemption Date, the date upon which any advance payment of
principal or interest is required by the provisions of Section 2.1 of this Agreement, and any date
on which any principal of, premium, if any, or interest on the Bonds shall be due and payable upon
mandatory redemption because of acceleration.



     “Loan Payments” means the amounts required to be paid and/or prepaid by the provisions of
Section 2.1 of this Agreement, as the same may hereafter be amended or supplemented.



     “Net Proceeds” means, as to any insurance proceeds or any condemnation award, the amount
remaining after deducting therefrom all expenses (including attorneys’ fees and any Extraordinary
Expenses, as defined in the Indenture, of the Trustee) incurred in the collection of such proceeds
or award.



     “Note” or “Notes” means the promissory note dated the date of the Project Bonds, constituting
the promise of the Borrower to repay the Loan to the Issuer, which Note shall be in substantially
the form attached to this Agreement as Exhibit A, and any additional promissory note or
notes executed and delivered with respect to Additional Bonds.



3









 





     “Notice Address” means such addresses as are specified in Section 14.04 of the Indenture, or
such different address, notice of which is given under Section 10.3 of this Agreement, but no such
notice shall thereby be required to be sent to more than two addresses.



     “Permitted Investments” means:




     (a) Bonds or other obligations of the United States of America;




     (b) Bonds or other obligations, the payment of the principal and interest of which is
unconditionally guaranteed by the United States of America;




     (c) Obligations issued or guaranteed as to principal and interest by any agency or
person controlled or supervised by and acting as an instrumentality of the United States of
America pursuant to authority granted by the Congress of the United States of America;




     (d) Securities or receipts evidencing ownership interests in obligations or specified
portions (such as principal or interest) of obligations described in (a), (b) or (c) above;




     (e) Commercial or finance company paper which is rated either P-1 or A-1 or an
equivalent by Moody’s or S&P (including investments in pools or such commercial or finance
company paper owned by the Trustee or any affiliate of the Trustee);




     (f) Obligations issued by or on behalf of any state of the United States of America, or
any political subdivision of any such state, which are rated at least A2 or A (or an
equivalent) by Moody’s or S & P, respectively;




     (g) Funds comprised of obligations described in (f) above to the extent described in
Treasury Regulation 1.1488(e)(3)(iii), including any such fund managed by the Trustee or any
affiliate of the Trustee;




     (h) Money market funds which are rated prime-1 or AAAm (or an equivalent) by Moody’s or
S & P, including any such money market fund managed by the Trustee or any affiliate of the
Trustee; or




     (i) Any other investment not prohibited by applicable law (as evidenced by an opinion
of counsel reasonably acceptable to the Trustee furnished to the Trustee).



     “Person” means an individual, a partnership, a corporation, a limited liability company, a
trust, an unincorporated organization, a joint-stock company, an association and a government or
any department or agency thereof.



     “Prime Rate” shall have the meaning assigned to such term in the Reimbursement Agreement.



     “Project” means the solid waste disposal components of the ethanol facility of the Borrower to
be built on the Project Site.



     “Project Bonds” means the Bond or Bonds initially issued by the Issuer pursuant to the
Indenture and designated “$29,000,000 Mitchell County Development Authority Variable Rate Demand
Solid Waste Disposal Revenue Bonds (First United Ethanol, LLC Project), Series 2006.”



     “Project Purposes” means the solid waste disposal components of an ethanol refining facility.



4









 





     “Project Site” means the real property described in Exhibit C of this Agreement.



     “Registered Bonds” means Bonds registered in the name of the holder.



     “Secretary” means the Secretary of the Issuer.



     “State” means the State of Georgia.



     “Termination Date” means October 1, 2026, subject to earlier termination as provided in this
Agreement.



     “Trustee” means the bank or trust company at the time serving as Trustee under the
Indenture.



     “Unassigned Issuer’s Rights” means all of the rights of the Issuer to receive Additional
Payments under Section 2.2 hereof, and to be held harmless and indemnified and to be reimbursed for
attorney’s fees and expenses under Sections 6.7 and 9.4, respectively, hereof.



     Section 1.3. No Constitutional Debt.



     It is understood and agreed by the Borrower and the Bond owners that no covenant, provision or
agreement of the Issuer herein or in the Bonds or in any other document executed by the Issuer in
connection with the issuance, sale and delivery of the Bonds, or any obligation herein or therein
imposed upon the Issuer or breach thereof, shall give rise to a pecuniary liability of the Issuer
or a charge against its general credit or general fund or shall obligate the Issuer financially in
any way except with respect to the application of revenues under this Agreement, and the proceeds
of the Bonds. No failure of the Issuer to comply with any term, condition, covenant or agreement
therein shall subject the Issuer to liability for any claim for damages, costs or other financial
or pecuniary charges except to the extent that the same can be paid or recovered from this
Agreement or revenues therefrom or proceeds of the Bonds. No execution on any claim, demand, cause
of action or judgment shall be levied upon or collected from the general credit or general funds of
the Issuer. In making the agreements, provisions and covenants set forth herein, the Issuer has
not obligated itself except with respect to this Agreement and the application of revenues
hereunder as hereinabove provided. The Bonds constitute special obligations of the Issuer, payable
solely from the revenues pledged to the payment thereof pursuant to this Agreement and the
Indenture, and do not now and shall never constitute an indebtedness or a loan of the credit of the
Issuer, the State of Georgia or any political subdivision thereof within the meaning of any
constitutional or statutory provision whatsoever. The Issuer has no taxing power. It is further
understood and agreed by the Borrower and the Holders that the Issuer shall incur no pecuniary
liability hereunder and shall not be liable for any expenses related hereto. If, notwithstanding
the provisions of this Section, the Issuer incurs any expense, or suffers any losses, claims or
damages or incurs any liabilities, the Borrower will indemnify and hold harmless the Issuer from
the same and will reimburse the Issuer for any legal or other expenses incurred by the Issuer in
relation thereto, and this covenant to indemnify, hold harmless and reimburse the Issuer shall
survive delivery of and payment for the Bonds.



     Any reference herein to the Issuer, or to any officers thereof, shall include any person or
entity which succeeds to its or their duties or responsibilities pursuant to or by operation of
law. Any reference to a section or provision of the Georgia Constitution or the Act shall include
such section or provision or chapter as from time to time amended, modified, revised, supplemented,
or superseded; provided, however, that no such change in the Constitution or laws (a) shall alter
the obligation to pay the Bond service charges in the amounts and manner, at the times, and from
the sources provided in the Bond Resolution and the Indenture,
except as otherwise herein permitted or (b) shall be deemed applicable by



5









 







reason of this
provision if such change would in any way constitute an impairment of the rights of the Issuer, the
Bank or the Borrower under the Agreement or the Indenture.



     The terms “hereof”, “hereby”, “hereto”, “hereunder” and similar terms, refer to this Loan
Agreement.



ARTICLE II




THE LOAN; LOAN PAYMENTS, LETTER OF CREDIT AND

ADDITIONAL PAYMENTS;

BORROWER TO EXECUTE AND DELIVER NOTE




     Section 2.1. Amount and Terms of the Loan; the Note. The Issuer agrees,
subject to the terms and conditions in this Agreement, to lend to the Borrower the proceeds from
the sale of the Project Bonds. Such proceeds (after deducting the Original Purchaser’s bond
discount, if any) shall be deposited with the Trustee and disbursed, after deducting the Bond Fund
Payment as provided in the Indenture, in accordance with the provisions of Section 4.2 hereof in
payment of costs of the Project and costs of issuance and sale of the Project Bonds. Concurrently
with the issuance of the Project Bonds, the Borrower agrees to and shall execute and deliver a Note
in substantially the form attached hereto as Exhibit A, evidencing the obligation of the Borrower
to repay the Loan made by the Issuer. Such Note shall be dated the date of authentication and
delivery of the Project Bonds, shall be payable to the order of the Issuer for the principal amount
of the Loan, and shall be payable in the amounts and at the rates set forth in such Note. Such
amounts of principal, interest and premium, if any, shall together constitute the Loan Payments.



     The Borrower shall, simultaneously with the delivery of the Project Bonds and the Note,
deliver or cause to be delivered the Letter of Credit and Confirming Letter of Credit to the
Trustee. The Borrower agrees that it will not, either by its action or inaction, in any way
adversely affect the continuation or effectiveness of either the Letter of Credit or the Confirming
Letter of Credit.



     All Loan Payments made hereunder on account of principal of and interest and any premium on
the Note shall be made directly to the Trustee at its corporate trust office for the account of the
Issuer, for deposit in the Reimbursement Account in the Bond Fund, in accordance with the terms of
the Note; provided, however, that, notwithstanding anything in this paragraph to the contrary, so
long as the Letter of Credit or an Alternate Letter of Credit consisting of a direct-pay letter of
credit with respect thereto shall be in effect, Loan Payments shall be made by the Borrower
directly to the Bank.



     The Borrower shall have the right to prepay the Loan in full and in part and without premium
or penalty but with accrued interest to the date of such prepayment on the amount prepaid, upon the
happening of an event described in Section 8.2(a), (b) or (c) of this Agreement.



     Prior to conversion to a Fixed Interest Rate, the Bonds are subject to optional redemption in
whole or in part in integral multiples of $5,000 (provided that the unredeemed portion of any Bond
redeemed in part shall be $100,000 or more), at the direction of the Borrower, on any Interest
Payment Date, at a redemption price of 100% of the principal amount to be redeemed, plus interest
accrued to the redemption date.



     In the event of any such optional prepayment, however, before the Borrower gives the notice in
accordance with Section 8.4 of this Agreement of its intention to exercise its option to prepay the
Loan in whole or in part, the Borrower shall deposit with the Bank the full amount of the
prepayment price,



6









 







including accrued interest to the date of prepayment specified in the aforesaid notice, or
alternatively, obtain a written waiver of such deposit requirement from the Bank. The Borrower
shall be required to prepay the Loan in full with accrued interest to the date of such prepayment
on the amount prepaid, upon the happening of an event described in Section 8.3 of this Agreement.
Any such prepayment pursuant to said Section 8.3 shall be without premium or penalty. Any such
optional or mandatory prepayment shall be made pursuant to the notice provisions described in
Section 8.4 of this Agreement.



     In any event, if the sum of the Loan Payments payable under this Section shall be sufficient
to pay the total amount due with respect to the principal of, premium (if any) and interest on the
Bonds as and when due, and if at any time when said payments are due the balance in the Bond Fund
is insufficient to make such payments, the Borrower will forthwith pay to the Trustee, for the
account of the Issuer for deposit into the Bond Fund, any such deficiency; provided, that any
amount at any time held by the Trustee in the Bond Fund as the Bond Fund Payment, as interest
earned on moneys held by the Trustee and deposited in the Reimbursement Account in the Bond Fund
and any other moneys in the Reimbursement Account, as the proceeds of business interruption
insurance, or as a result of the payment of any penalties or liquidated damages received or
withheld under construction contracts and deposited in the Reimbursement Account in the Bond Fund
shall be transferred by the Trustee to the Bank pursuant to Section 6.08 of the Indenture, and
provided further, that if at any time all the outstanding Bonds are paid and discharged within the
meaning of the Indenture and the Bank has been fully reimbursed under the Reimbursement Agreement,
the Borrower shall not be obligated to make any further Loan Payments under this Section. All
payments made pursuant to this Section shall be made in such manner and at such times as shall be
necessary to assure that the Trustee shall receive such payments in sufficient time to permit
payment of the amounts of the principal of, and interest and any premium on the Bonds when the same
shall respectively become due and payable.



     The Borrower has provided for the payment of the principal of the Project Bonds, upon
maturity, redemption or acceleration, and up to 109 days’ interest on the Project Bonds from
payments to be made by the Bank to the Trustee pursuant to the Letter of Credit. Pursuant thereto,
the Borrower hereby authorizes the Trustee to draw under the Letter of Credit the moneys necessary
to pay the principal of and interest on the Project Bonds as they become due, including as a result
of an Event of Taxability. The Borrower authorizes the Trustee to draw moneys, in which moneys the
Borrower has no interest, under the Letter of Credit in an amount sufficient to pay the principal
of and interest on the Project Bonds on the date such principal or interest becomes due. The amount
of such drawings shall be credited against the Borrower’s obligations to make Loan Payments
hereunder and under the Note.



     Section 2.2. Additional Payments. The Borrower agrees to make Additional Payments as
follows:




	 	(a)	 	To the Issuer, the Issuer’s Fee and as reimbursement for any and all reasonable
costs, expenses and liabilities paid by the Issuer in satisfaction of any obligations
of the Borrower hereunder not performed in accordance with the terms hereof by the
Borrower, provided, however, that the Issuer shall be under no obligation to pay any
expenses, costs or liabilities of the Borrower.
	 
	 	(b)	 	To the Issuer, as reimbursement for or prepayment of reasonable expenses paid
or to be paid by the Issuer and requested by the Borrower, or required by this
Agreement, or the Indenture or incurred in enforcing the provisions of this Agreement
or the Indenture, or incurred in defending any action or proceedings with respect to
the Project, this Agreement, or the Indenture, or incurred for any other action to be
taken by the Issuer pursuant to this Agreement, the Indenture or any other document or
agreement related to the issuance or sale of the Bonds, or arising out of or based upon
any other document




7









 












	 	 	 	related to the issuance of
the Bonds which are not otherwise required to be paid by the Borrower under this
Agreement.
	 
	 	(c)	 	To the Trustee, the customary fees and reasonable charges and expenses of the
Trustee as trustee, bond registrar and paying agent, and of any other paying agent on
the Bonds under the Indenture, all as provided in the Indenture, as and when the same
become due.
	 
	 	(d)	 	To the Remarketing Agent, the reasonable fees and expenses of the Remarketing
Agent for services rendered in connection with the Project Bonds, including its fees
for remarketing Project Bonds.
	 
	 	(e)	 	The Borrower will pay, as the same become due: (i) all taxes and governmental
charges of any kind whatsoever that may at any time be lawfully assessed or levied
against or with respect to the Project or any machinery, equipment, furnishings or
other property installed by the Borrower thereon including, without limiting the
generality of the foregoing, ad valorem taxes or payments in lieu of such taxes
lawfully assessed against the Project; (ii) all utility and other charges incurred in
the operation, maintenance, use, occupancy and upkeep of the Project; and (iii) all
assessments and charges lawfully made by any governmental body for public improvements
that may be secured by a lien on the Project; provided, that with respect to special
assessments or other governmental charges that may lawfully be paid in installments
over a period of years, the Borrower shall be obligated to pay only such installments
as are required to be paid while payments of principal or interest are outstanding with
respect to the Note.





     If the Borrower shall first notify the Trustee and the Bank of its intention to do so, the
Borrower may, at its expense and in its own name, in good faith contest any such taxes, assessments
and other charges and, in the event of any such contest, may permit the taxes, assessments or other
charges so contested to remain unpaid (except where tender of all or a portion of the taxes,
assessments or other charges may be made without prejudice to the Borrower’s contest regarding
same, in which case such tender shall be made to avoid the imposition of any penalty) during the
period of such contest and any appeal therefrom unless the Trustee or the Bank shall notify the
Borrower that, in the opinion of Independent Counsel, by nonpayment of any such items the lien of
the Indenture or the Mortgage will be materially endangered or the Project or any material part
thereof will be subject to imminent loss or forfeiture, in which event such taxes, assessments or
charges shall be promptly satisfied and discharged by payment thereof, by furnishing a bond
satisfactory to the Trustee and the Bank, or by payment to a reserve held by the Trustee; provided
that the Borrower may, without creating a default hereunder, contest in good faith the necessity or
the reasonableness of any such cost, expense or liability (other than any amount which represents
principal of or interest or any premium on any Bonds).



     Section 2.3. Notes. In addition to the Note described in Section 2.1 hereof, a
Note or Notes in an aggregate principal amount equal to the principal amount of any Additional
Bonds will be executed and delivered by the Borrower in a form substantially similar to the form of
the Note attached hereto as Exhibit A, with the necessary and appropriate variations, omissions and
insertions as permitted and required by this Agreement as amended and supplemented. All Notes
shall:




	 	(a)	 	Provide for payments of interest equal to the payments of interest on the
corresponding Bonds;
	 
	 	(b)	 	require payments and/or prepayments of principal and any premium equal to the
payments of principal and any premium on the corresponding Bonds;




8









 






	 	(c)	 	require all payments on such Notes to be made on or prior to the due dates for
the corresponding payments to be made on the corresponding Bonds;
	 
	 	(d)	 	contain optional and mandatory prepayment provisions and provisions in respect
of the optional and mandatory acceleration or prepayment of principal and any premium
corresponding with the redemption provisions of the corresponding Bonds; and
	 
	 	(e)	 	be on a parity with all other Notes theretofore or thereafter executed and
delivered by the Borrower pursuant to this Agreement as the same may be amended or
supplemented in connection with issuance of any Bonds, except with respect to draws
under the Letter of Credit.





     Upon payment in full of the principal of and interest and any premium on any or all Bonds,
whether at maturity or by redemption or otherwise, and the surrender thereof to, and cancellation
thereof by, the Trustee, or upon provision for the payment thereof having been made in accordance
with the provisions of the Indenture, the Notes, issued concurrently with such Bonds, of the same
maturity, bearing the same interest rate and in an amount equal to the aggregate principal amount
of such Bonds so surrendered and canceled or for the payment of which provision has been made,
shall be deemed fully paid and the obligations of the Borrower thereunder terminated and such Notes
shall be canceled and surrendered by the Trustee to the Borrower. Notwithstanding the previous
sentence, in the event that moneys sufficient for such payment have been paid to the Trustee by the
Bank, and amounts are owing to the Bank under the Reimbursement Agreement, as evidenced by a
written certificate of the Bank delivered to the Trustee, the Trustee shall upon written
instructions of the Bank assign all of its right, title and interest in and to the Notes to the
Bank. The Borrower hereby agrees and consents to such an assignment without defense or set-off by
reason of any dispute between the Borrower and the Trustee. Unless the Borrower is entitled to a
credit under express terms of this Agreement or the Indenture, all payments on each Note shall be
in the full amount required thereunder. Each Note shall be payable to the Issuer and shall not be
negotiated by the Issuer, except to effect assignment thereof to the Trustee and to any successor
trustee under the Indenture.



     Section 2.4. Assignment of Payments and Note. The Issuer will, as security for
payment of the Bonds, concurrently with the issuance of the Bonds, pledge and assign, without
recourse, to the Trustee all right, title and interest of the Issuer in and to the corresponding
Note and the Issuer’s rights under this Agreement to receive the Loan Payments, including the right
to receive payments under such Note (but specifically excluding Unassigned Issuer’s Rights), and
hereby covenants and agrees with the Borrower to pledge, assign and deliver the Note issued
pursuant to Section 2.1 hereof to the Trustee. The Issuer hereby authorizes and directs the
Borrower and the Borrower hereby agrees, to pay all Loan Payments either directly to the Trustee at
its corporate trust office for the account of the Issuer and for deposit in the Bond Fund or to the
Bank. Additional Payments shall be paid directly to the person or entity to whom or to which they
are due.



     Section 2.5. Obligations Unconditional. The obligations of the Borrower to
make payments pursuant to this Agreement and to perform and observe the other agreements on its
part contained herein shall be absolute and unconditional. Until such time as all conditions
provided in the Indenture for release of the Indenture are met, the Borrower (i) will not suspend
or discontinue any payments pursuant to the Note or Notes or this Agreement, (ii) will perform and
observe all of its other agreements contained in this Agreement, and (iii) except as provided in
Article VIII hereof, will not terminate this Agreement for any cause including, without limiting
the generality of the foregoing, failure to complete the Project, failure of title to the Project
or Project Site or any portion thereof, any acts or circumstances that may constitute failure of
consideration, destruction of or damage to the Project, or any portion thereof, commercial
frustration of purpose, any change in the tax or other laws or administrative rulings of or



9









 







administrative actions by or under
authority of the United States of America or of the State or any failure of the Issuer or the
Bank to perform and observe any agreement, whether expressed or implied, or any duty, liability or
obligation arising out of or connected with this Agreement or the Reimbursement Agreement, the
Indenture or the Tax Agreement. The Borrower may, however, at its own cost and expense and in its
own name, prosecute or defend any action or proceeding or take any other action involving third
persons which the Borrower deems reasonably necessary in order to secure or protect its rights
hereunder.



     Section 2.6. Prepayment of Loan and Additional Payments; Moneys for Optional
Redemption. The Borrower shall have the option to prepay all or part (in integral multiples of
$5,000, provided that prior to the conversion to the Fixed Interest Rate the remaining principal
amount attributable to Bonds held by any single owner must be $100,000 or more) of the Loan (i) on
the dates and at the prepayment prices provided in Section 2.1 of this Agreement, (ii) upon
depositing sufficient moneys with the Bank as set forth in said Section 2.1, and (iii) upon giving
notice in accordance with Section 8.4 hereof.



     Payments required under the Note shall be accelerated as necessary to correspond with, in time
and amount, payments of principal of and interest and premium, if any, on the Bonds.



     Section 2.7. Past Due Loan Payments and Additional Payments. In the event that the
Borrower should fail to pay any Loan Payments or Additional Payments, the payment in default shall
continue as an obligation of the Borrower with interest payable at the Interest Rate for Advances
until the amount in default shall have been fully paid; provided, however, that anything herein to
the contrary notwithstanding the rate of interest on any Loan Payment in default shall not be less
than the rate of interest on the Bonds to which such Loan Payment relates.



     Section 2.8. Redemption of Bonds. The Issuer, at the written request at any time of
the Borrower provided that the Borrower shall have deposited sufficient moneys with the Bank as set
forth in Section 2.1 hereof and given notice in accordance with Section 8.4 hereof, and upon
provision first made for the Issuer’s reasonable expenses, if any, shall forthwith take all steps
that may be necessary under the applicable redemption provisions of the Indenture to effect the
redemption of all or part of the then outstanding Bonds, as may be specified by the Borrower, on
the earliest redemption date on which such redemption may be made under such applicable provisions.



     Section 2.9. Adjustment of Loan Payments in the Event of Redemption or Cancellation of
Project Bonds. In the event any Project Bonds are redeemed or in the event the Borrower
delivers to the Trustee any Project Bonds with instructions to cancel said Bonds, then in that
event the principal amount of such Bonds shall be allowed as a credit against principal payable
under the Note in the inverse order of principal payments due under the Note.



     Section 2.10 Assignment of Agreement and Revenues. To secure the payment of Bond
service charges, the Issuer shall assign, by the Indenture, its rights under and interest in this
Agreement (except for the Unassigned Issuer’s Rights) and the Revenues to the Trustee. The Borrower
hereby agrees and consents to those assignments.



     Section 2.11 Payments to Remarketing Agent. The Borrower shall pay to the Remarketing
Agent on or before each Interest Payment Date on which the Remarketing Agent is required to
remarket Project Bonds, an amount equal to the amount to be paid by the Remarketing Agent for the
purchase of Project Bonds on such Interest Payment Date, pursuant to the Indenture, provided that
amounts available on such Interest Payment Date for such payment from either:




     (i) proceeds of the remarketing of such Project Bonds by the Remarketing Agent, or



10









 






     (ii) proceeds of a draw under the Letter of Credit shall be credited against the
Borrower’s obligation to make payments under this Section 2.11.



     The Borrower hereby consents to the appointment of the Remarketing Agent pursuant to
and as specified in Section 3 of the Bond Resolution and Sections 10.11 and 10.12 of the Indenture.



     Section 2.12 Letter of Credit and Confirming Letter of Credit; Alternate Letter of Credit
and Alternate Confirming Letter of Credit.



     (a) From the date of issuance of the Bonds, the Borrower shall provide security for payment of
the principal of and interest on the Bonds and for payment of the purchase price of Bonds delivered
to the Paying Agent or the Remarketing Agent pursuant to Section 3.01 of the Indenture by causing
the Letter of Credit and each Confirming Letter of Credit to be delivered to the Trustee. The
Borrower hereby authorizes and directs the Trustee to draw moneys under the Letter of Credit and,
upon the wrongful dishonor by the Bank of any request for payment under the Letter of Credit, the
Confirming Letter of Credit, in accordance with their terms and the terms of the Indenture, to the
extent necessary to pay the principal of, premium, if any, and interest on the Bonds when due and
to pay the purchase price of Bonds tendered, as provided in the Indenture.



     (b) The Letter of Credit and any Confirming Letter of Credit may be extended beyond their then
stated date of expiration as provided in the Reimbursement Agreement. At any time prior to the
Trustee’s giving of notice of mandatory redemption of Bonds pursuant to Section 3.07C of the
Indenture, the Borrower may provide for the delivery of an Alternate Letter of Credit or Alternate
Confirming Letter of Credit, provided that the Borrower must furnish to the Trustee the opinion of
Bond Counsel required under Section 6.08B(ii) of the Indenture. In addition to the foregoing, the
Alternate Letter of Credit or Alternate Confirming Letter of Credit must be delivered to the
Trustee and must be effective prior to the Date of Mandatory Tender.



     The Borrower shall take whatever action may be necessary to maintain the Letter of Credit or
an Alternate Letter of Credit, and the Confirming Letter of Credit or any Alternate Confirming
Letter of Credit in full force and effect during the period required by the Indenture, including
the payment to the Bank and the Confirming Bank of all amounts payable under the Reimbursement
Agreement at the times and in the amounts described therein and the payment of any transfer fees
required by the Bank or the Confirming Bank upon any transfer of the Letter of Credit or an
Alternate Letter of Credit, or the Confirming Letter of Credit or any Alternate Confirming Letter
of Credit to any successor Trustee pursuant to the Indenture.



ARTICLE III




ACQUISITION, CONSTRUCTION, EQUIPPING AND

OWNERSHIP OF THE PROJECT




     Section 3.1. Agreement to Acquire, Construct and Equip the Project. The Borrower
agrees:



     (a) To cause the Project to be acquired, constructed and equipped, using its best efforts to
do so with all dispatch to secure completion as promptly as is reasonably feasible, and will use
its best efforts to cause the acquisition, construction and equipping of other facilities and real
and personal property the Borrower reasonably deems necessary in connection with the Project to the
end that the Project will fulfill the Project Purposes.



11









 





     (b) To make, execute, acknowledge and deliver any contracts, orders, receipts, writings and
instructions with any other persons, firms or corporations, and in general do all things which, in
the reasonable business judgment of the Borrower, may be requisite or proper for acquiring,
constructing and equipping the Project.



     (c) Where economically feasible, to ask, demand, sue for, levy and use its best efforts to
recover and receive such sums of money, debts, dues or other demands whatsoever in connection with
the Project, to which it may be entitled under any contract, order, receipt, guaranty, warranty,
writing or instrument in connection with any of the foregoing, and to enforce the material
provisions of any contract, agreement, obligation, bond or other security in connection with the
Project. Any amounts received in connection with the foregoing, after deduction of expenses
incurred in such recovery (i) prior to the Completion Date and full disposition of the Project Fund
in accordance with this Agreement and the Indenture, shall be paid into the Project Fund, or (ii)
after the Completion Date and full disposition of the Project Fund in accordance with this
Agreement and the Indenture shall be used in accordance with Section 4.2(g) hereof, as if such
amounts were remaining in the Project Fund after the Completion Date and after payment of all
costs, or provision therefor, had been made. Notwithstanding the other provisions of this
paragraph, any liquidated damages received from any contractor for failure to complete work on time
shall be paid to the Trustee for deposit in the Reimbursement Account in the Bond Fund.



     Section 3.2. Completion Date. Completion of the improvement and equipping of the
Project shall be evidenced to the Issuer, the Trustee, the Bank and the Borrower by a certificate
signed by the Authorized Borrower Representative stating that, except for any amounts retained by
the Trustee at the direction of the Authorized Borrower Representative, for any amount of the costs
set forth in Subsections 4.2(a) through (f) hereof not then due and payable, (i) acquisition,
construction and equipping of the Project have been substantially completed and all labor,
services, materials and supplies used in such acquisition, construction and equipping have been
paid for, (ii) all other facilities necessary in connection with the Project have been acquired,
constructed and equipped and all costs and expenses incurred in connection therewith have been
paid, and (iii) all acquisition, construction and equipping of the Project and facilities necessary
thereto have been accomplished in such a manner as to conform with all applicable zoning, planning,
building, environmental and other similar regulations of all governmental authorities having
jurisdiction, and have been accomplished to the satisfaction of the Borrower so as to permit
efficient operation for the Project Purposes. Said certificate shall also specify the date by which
the foregoing three events have occurred. Notwithstanding the foregoing, such certificate shall
state that it is given without prejudice to any rights against third parties which then exist or
may subsequently arise.



     Section 3.3. Agreement as to Ownership of Project. The Issuer and the Borrower agree
that, during the term of this Agreement, title to and the ownership of the Project shall vest in
and remain in and be the sole property of the Borrower.



     Section 3.4. Use of Project. The Issuer does hereby covenant and agree that it will
not take any action during the term of this Agreement, other than pursuant to Article IX of this
Agreement or Article IX of the Indenture, to interfere with the Borrower’s ownership of the Project
or to prevent the Borrower from having possession, custody, use and enjoyment of the Project,
except such action as may be required of or permitted to the Issuer in its governmental capacities.



     Section 3.5. Additional Bonds. Subject to the provisions of Section 8 of the Bond
Resolution for the Project Bonds, the Borrower and the Issuer agree that one or more series of
Additional Bonds may be issued pursuant to the Indenture.



12









 





ARTICLE IV




ISSUANCE OF BONDS;

APPLICATION OF PROCEEDS




     Section 4.1. Issuance of Bonds; Deposit of Bond Proceeds. In order to provide funds
to make the Loan and thereby pay for the costs described in Section 4.2 hereof and incurred under
or in connection with this Agreement, concurrently with the delivery to the Trustee of the Note as
provided in Section 2.1 hereof, the Issuer will issue, sell and deliver the Project Bonds to the
Original Purchaser and will deposit the proceeds (net of the Original Purchaser’s bond discount, if
any) of said Project Bonds, after deducting the Bond Fund Payment as provided in the Indenture,
into the Project Fund. The moneys derived from the proceeds of the Project Bonds deposited in the
Project Fund, pending application as provided in Section 4.2 hereof, are subject to a lien in favor
of the holders of the Project Bonds as provided in the Indenture.



     Section 4.2. Disbursements from the Project Fund. The Issuer has, in the
Indenture, authorized and directed the Trustee to use the moneys in the Project Fund for the
disbursements required by the provisions of this Agreement. Such disbursements shall be to pay, or,
to the extent the Borrower shall have paid, to reimburse the Borrower, for the following:



     (a) Costs incurred directly or indirectly for or in connection with the acquisition,
construction or equipping of the Project including but not limited to those for any feasibility
study, preliminary planning and studies, architectural, legal, engineering and supervisory
services, labor, services, materials, grading, construction, and equipment acquisition and
installation, and including interest on the Bonds during the Construction Period to the extent that
such interest qualifies as or may be treated as “construction period interest” as defined in the
Code.



     (b) Premiums attributable to all insurance required to be taken out and maintained during the
Construction Period with respect to the Project, the premium on each surety bond, if any, required
with respect to work on the Project, and taxes, assessments and other charges in respect of the
Project, that may become due and payable during the Construction Period.



     (c) Costs incurred directly or indirectly in seeking to enforce any remedy against any
contractor or subcontractor in respect of any default under any contract relating to the Project.



     (d) Financial, legal, accounting, printing and engraving fees, charges and expenses, and all
other such fees, charges and expenses incurred in connection with the Bonds and the preparation and
delivery of this Agreement, the Indenture, the Mortgage and related documents.



     (e) Fees and expenses of the Trustee and of any paying agent properly incurred under the
Indenture that may become due and payable during the Construction Period, and the initial or
acceptance fee of the Trustee.



     (f) Any other incidental and necessary costs including without limitation any expenses, fees
and charges, relating to the acquisition, construction or equipping of the Project, including
deposits to the Reimbursement Account in the Bond Fund for the purpose of reimbursing the Bank for
draws under the Letter of Credit to pay interest during the Construction Period, and including
deposits to the Rebate Fund for the purpose of making any payments required pursuant to the Tax
Agreement; provided, that nothing in this Agreement permits, or shall be construed to permit, the
expenditure of any moneys in the Project Fund for, or in reimbursement of payments made for, the
acquisition of raw materials or supplies (other than raw
materials or supplies used in connection with the installation of the Project), inventory, or
accounts receivable, or for provision of working capital, including the payment of any principal or



13









 







interest on any other secured or unsecured indebtedness incurred by the Borrower in connection with
the Project, and no such expenditure shall be made from the Project Fund.



     (g) All moneys in the Project Fund (including moneys earned thereon by investment thereof)
remaining after the Completion Date and payment, or provision for payment, in full of the costs
provided for in the preceding subsections of this Section, then due and payable, shall promptly be
deposited in a subaccount (“Subaccount”) of the Reimbursement Account in the Bond Fund and, at the
direction of the Authorized Borrower Representative, used to (i) reimburse the Bank for draws on
the Letter of Credit to redeem Bonds (if such Bonds are subject to redemption under applicable
provisions hereof or of the Indenture) or (ii) purchase Bonds in the open market for the purpose of
cancellation at prices not exceeding par plus accrued interest thereon to the date of payment
therefor, or(iii) a combination of the foregoing; provided that amounts approved by the Authorized
Borrower Representative and the Bank shall be retained by the Trustee in the Project Fund for
payment of such costs not then due and payable, and any balance remaining of such retained funds
after full payment of all such costs shall be used in the manner specified and in the priorities
set forth in clauses (i), (ii) and (iii) of this subsection; and further provided, that if such
moneys remaining in the Project Fund prior to application in the manner specified in clauses (i),
(ii) and (iii) of this subsection exceed 10% of the aggregate principal amount of the Project Bonds
after subtracting the total of the costs of the issuance, sale and delivery of the Project Bonds,
paid out of Bond proceeds, then the amount by which such moneys remaining in the Project Fund
exceeds the amount specified above shall only be applied by the Borrower as set forth in clause (i)
above to redeem or retire Bonds, or a portion thereof at the earlier of their next redemption date
or date of maturity and pending such application such amount shall be held in escrow in the
Subaccount in the Reimbursement Account in the Bond Fund and the yield on such escrowed amount
shall not exceed the yield on the Bonds, and provided further that with regard to such redemption
or retirement of Bonds, such excess shall not be applied to any premium which is paid for such
Bonds.



     Section 4.3. Obligation of the Parties to Cooperate in Furnishing Documents. The
Borrower agrees to cause such approvals and orders to be directed by the Authorized Borrower
Representative to the Trustee as may be necessary to effect payments out of the Project Fund in
accordance with Section 4.2 hereof.



     Section 4.4. Borrower Required to Pay Costs in Event Project Fund Insufficient. In
the event the moneys in the Project Fund (including moneys from the proceeds of any Additional
Bonds sold to finance completion of the Project) should not be sufficient to pay all costs payable
therefrom, the Borrower agrees, in order to fulfill the public purposes for which the Project is to
be used, to complete the acquisition, construction and equipping to be accomplished pursuant hereto
and to pay all costs therefor in full; provided, however, that nothing contained herein shall
impair the Borrower’s rights under Article VIII hereof. The Issuer does not make any warranty,
either expressed or implied, that the moneys, which will be paid into the Project Fund and which
under the provisions of this Agreement will be available for payment of the costs of the
acquisition, construction and equipping to be accomplished pursuant hereto, will be sufficient to
pay all the costs which will be incurred in that connection. The Borrower agrees that if after
exhaustion of the moneys in the Project Fund the Borrower should pay pursuant hereto any portion of
the said costs listed in Section 4.2 hereof, it shall not be entitled to any reimbursement therefor
from the Issuer, the Trustee, or the holders of any of the Bonds, nor shall it be entitled to any
diminution in or abatement or postponement of the Loan Payments.



     Section 4.5. Investment of Fund Moneys. Except as otherwise provided in the Indenture
or Tax Regulatory Agreement, any moneys held as part of the Bond Fund or Project Fund shall at the
oral (and if oral, to be confirmed in writing) or written request of the Authorized Borrower
Representative be invested or
reinvested by the Trustee in Permitted Investments. The Borrower covenants that the use of the
proceeds of the Bonds will be restricted in such manner and to such extent, if any, as may be
necessary,



14









 







after taking into account reasonable expectations at the time of issuance of the Bonds,
so that they will not constitute “arbitrage bonds” within the meaning of Section 148 of the Code.
The Borrower and the Issuer hereby agree that the gross proceeds of the Project Bonds will be
restricted, invested and rebated as provided in the Tax Agreement.



     Section 4.6. Excess Proceeds. Borrower will provide written notice to Issuer and
Trustee within ten (10) days of Borrower’s notice of the existence of excess proceeds from the
Bonds.



ARTICLE V




MAINTENANCE; INSURANCE; DAMAGE;

DESTRUCTION AND EMINENT DOMAIN




     Section 5.1. Maintenance. So long as any of the Bonds are outstanding within the
meaning of the Indenture, the Borrower shall in all material respects keep and maintain the
Project, including all appurtenances thereto and any personal property therein or thereon, in good
repair and good operating condition (reasonable wear and tear excepted).



     So long as such shall not be in violation of the Act, and provided there is continued
compliance with applicable laws and regulations of governmental jurisdictions, the Borrower shall
have the right to remodel the Project or make additions, modifications and improvements thereto,
from time to time as it, in its discretion, may deem to be desirable for its uses and purposes, the
cost of which remodeling, additions, modifications and improvements shall be paid by the Borrower
or, to the extent permitted by the Indenture, from the proceeds of Additional Bonds, and the same
shall, when made, become a part of the Project, provided, however, that any such remodeling shall
not have a material adverse effect on the value of the Project; and provided further, however, that
the Borrower shall not, except as required by law, remodel the Project or make any additions,
modifications, or improvements thereto which would cause the Project to fail to meet the
requirements of all applicable fire and safety codes.



     Section 5.2. Removal of Portions of the Project. The Borrower may remove items of
furnishings or equipment constituting part of the Project only in accordance with the provisions of
the Reimbursement Agreement and the Mortgage.



     Section 5.3. Option to Release Portion of Project. The Borrower has the option, with
the consent of the Bank, to release from the lien of the Mortgage any portion of the land, upon
which no buildings, structures, or improvements financed from Bond proceeds are located, and
appurtenances thereto and any equipment and fixtures which are subject to the lien of the Mortgage
provided that an independent architect or engineer certifies that such real and personal property
is not necessary for the operation of the Project and the release will not interfere with the use
of the Project. To the extent that (i) any of such equipment and fixtures are necessary for the
operation of the Project or (ii) the Borrower does not desire to purchase any of such equipment and
fixtures, and in either case such equipment and fixtures can be moved to another location on the
Project Site, then such equipment and fixtures shall be moved and shall not be released hereunder.
The purchase price for such release shall be the fair market value of such property as determined
by three independent real estate appraisers. The purchase price will be deposited in the
Reimbursement Account in the Bond Fund and used for the purposes for which the Reimbursement
Account in the Bond Fund was created.



     Section 5.4. Insurance Required. The Borrower shall keep the Project, or cause the
same to be kept, continuously insured against such risks, in such amounts and during such time
periods as is provided in the Mortgage and the Reimbursement Agreement. The Net Proceeds of the
insurance carried



15









 







pursuant hereto shall be paid and applied as provided in the Mortgage and the
Reimbursement Agreement.



     Section 5.5 [Reserved]



     Section 5.6. Worker’s Compensation Coverage. While the Note and any obligation under
the Reimbursement Agreement remains unpaid, including during the Construction Period, the Borrower
shall maintain or cause to be maintained, in connection with the Project, the Worker’s Compensation
coverage required by the laws of the State.



     Section 5.7. Mechanics’ Liens. The Borrower shall not suffer or permit any mechanics’
liens to be filed against the Project, nor against any Loan Payment paid or payable hereunder, by
reason of work, labor, services or materials supplied or claimed to have been supplied to the
Borrower or anyone holding the Project or any part thereof through or under the Borrower. If any
such mechanics’ liens shall at any time be filed, the Borrower shall, within ninety (90) days after
notice of the filing thereof, cause the same to be discharged of record by payment, deposit, bond,
order of a court of competent jurisdiction or otherwise. The Borrower shall have the right to
contest the validity and the amount of any such lien by appropriate proceedings timely instituted,
provided that the Borrower (a) gives the Issuer and the Bank written notice of its intention so to
do, (b) diligently prosecutes any such contest, and (c) if requested by the Issuer or the Bank,
furnishes a bond in cash in an amount equal to the amount required by applicable law, and the
Borrower shall not be in default hereunder for failure to pay or discharge any such lien so long as
it is contesting the same as aforesaid. In lieu of providing the cash required by clause (c) above,
the Borrower may provide the Issuer and the Bank with evidence of a title insurance policy or
endorsement satisfactory to the Bank which policy or endorsement insures over such lien.



     Section 5.8. Damage, Destruction and Eminent Domain. If, prior to full payment
of all Bonds outstanding (or provision for payment thereof having been made in accordance with the
provisions of the Indenture), the Project or any portion thereof is destroyed or damaged in whole
or in part by fire or other casualty, or title to, or the temporary use of, the Project or any
portion thereof shall have been taken by the exercise of the power of eminent domain, all Net
Proceeds from any insurance policy or any kind of condemnation awards in connection therewith shall
be applied pursuant to the provisions of the Reimbursement Agreement and the Mortgage.



ARTICLE VI




WARRANTIES, REPRESENTATIONS AND SPECIAL COVENANTS




     Section 6.1 Representations by the Issuer. The Issuer represents that:



     (a) The Issuer is a public body corporate and politic and an instrumentality of Mitchell
County, Georgia, duly organized and existing under the Constitution and the laws of the State.
Under the provisions of the Act, the Issuer has the power to enter into this Agreement and carry
out its obligations hereunder.



     (b) To the best knowledge of the Issuer, no member of the governing body or other officer or
employee of the Issuer or the State of Georgia is directly or indirectly interested in this
Agreement or the issuance and sale of the Bonds.



16









 





     (c) The issuance and sale of the Bonds and the execution and delivery of this Agreement and
the Indenture have been duly authorized by an ordinance of the legislative body of the Issuer
adopted at a meeting thereof duly called, by the affirmative vote of not less than a majority of
its elected members.



     (d) Prior to the date of issuance and delivery of the Project Bonds, a public hearing on the
proposal to undertake and finance the Project was duly called and held in accordance with the Act
and the Code, at which time all persons who appeared were given an opportunity to express their
views with respect thereto.



     (e) The execution and delivery of this Agreement and the Indenture and the other agreements
contemplated hereby to which the Issuer is a party will not conflict with, or constitute on the
part of the Issuer a breach of or a default under, any agreement, indenture, mortgage, lease or
other instrument to which the Issuer is subject or is a party or by which it is bound.



     Section 6.2 Representations of the Borrower. The Borrower makes the following
representations and warranties to induce the Issuer to enter into this Agreement:



     (a) The Borrower is a Georgia limited liability company duly formed and existing, in good
standing under the laws of the State of Georgia, is authorized to conduct its businesses in the
State of Georgia, and is not in violation of any provision of its articles of organization or any
laws of the State relevant to the transactions contemplated by this Agreement, the Bond Purchase
Agreement, the Remarketing Agreement, the Note, the Mortgage, the Indenture, the Tax Agreement or
the Reimbursement Agreement.



     (b) The Borrower has full power and authority to execute and deliver this Agreement, the Bond
Purchase Agreement, the Remarketing Agreement, the Mortgage, the Tax Agreement, the Note and the
Reimbursement Agreement and to carry out the transactions provided for herein and therein. This
Agreement, the Bond Purchase Agreement, the Remarketing Agreement, the Mortgage, the Tax regulatory
Agreement, the Note and the Reimbursement Agreement have by proper action been duly authorized,
executed and delivered by the Borrower and all steps necessary have been taken to constitute this
Agreement, the Bond Purchase Agreement, the Remarketing Agreement, the Mortgage, the Tax Agreement,
the Note and the Reimbursement Agreement when executed and delivered by the respective parties
thereto, valid and binding obligations of the Borrower.



     (c) The execution, delivery and performance by the Borrower of this Agreement, the Bond
Purchase Agreement, the Remarketing Agreement, the Mortgage, the Tax Agreement, the Note and the
Reimbursement Agreement and the consummation of the transactions contemplated hereby and thereby
will not violate any provision of law or regulation applicable to the Borrower, or of any writ or
decree of any court or governmental instrumentality, or of the Articles of Organization or
Operating Agreement or Partnership Agreement of the Borrower, or of any material mortgage,
indenture, contract, agreement or other material undertaking to which the Borrower is a party or
which is known to the Borrower to purport to be binding upon the Borrower or upon any of its
assets.



     (d) The financing, acquisition, construction and equipping provided for under this Agreement,
and commitments therefor made by the Issuer, have induced the Borrower to acquire, construct and
equip the equipment constituting the Project which will be used in the business of the Borrower.



     (e) Acquisition, construction and equipping in accordance with the Act will be accomplished
and the Project will be used and maintained in such manner as to
conform in all material respects with all



17









 







applicable zoning, planning, fire, building, environmental and other regulations, which
are material to the operation of the Project, of all governmental authorities having jurisdiction.



     (f) The Project is of the type authorized and permitted by the Act. The Project has been and
will be operated and maintained in such manner to conform in all material respects with all
applicable zoning, planning, building, environmental and other applicable governmental regulations
to be consistent with the Act.



     (g) Neither the Bank nor the Confirming Bank controls the Borrower, either directly or
indirectly through one or more intermediaries. The Borrower does not control either the Bank or the
Confirming Bank, either directly or indirectly, through one or more intermediaries. “Control” for
this purpose has the meaning given to such term in Section 2(a)(9) of the Investment Company Act of
1940. The Borrower hereby agrees to provide written notice to the Trustee, the Remarketing Agent
and the Bondholders not less than 30 days prior to the consummation of any transactions that would
result in the Borrower controlling or being controlled by either the Bank or the Confirming Bank,
or any provider of an Alternate Letter of Credit or Alternate Confirming Letter of Credit.



     (h) The Borrower agrees that it will annually on or before August 15 of each year furnish the
Mitchell County Development Authority with a statement of the amount of the Outstanding Bonds as of
the immediately preceding June 30. In addition, the Borrower shall provide the Mitchell County
Development Authority with any other information which may from time to time be requested
concerning the Bonds according to the rules and interpretations of the Governmental Accounting
Standards Board required to be disclosed concerning conduit debt obligations.



     Section 6.3. [Reserved]



     Section 6.4. Financial Statements. While any indebtedness of the Bonds is
outstanding, the Borrower shall provide the Bank the financial reports and certifications
reasonably required by the Reimbursement Agreement.



     Section 6.5. Borrower’s Approval of Indenture. The Indenture has been submitted to
the Borrower for examination, and the Borrower acknowledges, by execution of this Agreement, that
it has approved the Indenture and agrees to be bound by its terms.



     Section 6.6. Right of Access. The Borrower agrees that, subject to reasonable
security and safety regulations and to reasonable requirements as to notice and as to
noninterference with the conduct of business at the Project Site, the Issuer, the Trustee and the
Bank and they or any of their respective duly authorized agents shall have the right at all
reasonable times to enter upon and to examine and inspect the Project. The Borrower further agrees
that the Trustee and the Bank and their duly authorized agents shall have such rights of access to
the Project as may be reasonably necessary to cause to be completed the acquisition, construction
and equipping provided for herein, and thereafter for the proper maintenance of the Project in the
event of failure by the Borrower to perform its obligations hereunder.



     Section 6.7. Indemnification. The Borrower will, to the fullest extent
permitted by law, protect, indemnify and save the Issuer and the State and their officers, agents,
and employees and any person who controls the Issuer within the meaning of the Securities Act of
1933, harmless from and against all liabilities, losses, damages, costs, expenses (including
attorneys’ fees and expenses of the Issuer), taxes, causes of action, suits, claims, demands and
judgments in connection with the transaction contemplated by this Agreement or arising from or
related to the issuance or sale of the Bonds, including, but not limited to:



18









 






     (a) any injury to or death of any person or damage to property in or upon the Project
or growing out of or connected with the use, non-use, condition or occupancy of the Project
or any part
thereof, including any and all acts or operations relating to the acquisition or
installation of property or improvements. The foregoing indemnification obligations shall
not be limited in any way by any limitation on the amount or type of damages, compensation
or benefits payable by or for the Borrower, customers, suppliers or affiliated organizations
under any Workers’ Compensation Acts, Disability Benefit Acts or other employee benefit
acts;




     (b) violation of any agreement, provision or condition of this Agreement, the Bonds or
the Indenture, except a violation by the party seeking indemnification;




     (c) violation by the Borrower of any contract, agreement or restriction which shall
have existed at the commencement of the Term of this Agreement or shall have been approved
by the Borrower;




     (d) violation by the Borrower of any law, ordinance, court order or regulation
affecting the Project or a part thereof or the ownership, occupancy or use thereof;




     (e) any statement or information relating to the expenditure of the proceeds of the
Bonds contained in the Tax Agreement or similar document furnished by the Borrower to the
Issuer or Trustee which, at the time made, is misleading, untrue or incorrect in any
material respect; and




     (f) any untrue statement or alleged untrue statement of a material fact contained in
any offering material relating to the sale of the Bonds (as from time to time amended or
supplemented) or arising out of or based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or failure to properly register or otherwise qualify the
sale of the Bonds or failure to comply with any licensing or other law or regulation which
would affect the manner whereby or to whom the Bonds could be sold.



     Promptly after receipt by the Issuer or any such other indemnified person, as the case may be,
of notice of the commencement of any action with respect to which indemnity may be sought against
the Borrower under this Section, such person will notify the Borrower in writing of the
commencement thereof, and, subject to the provisions hereinafter stated, the Borrower shall assume
the defense of such action (including the employment of counsel, who shall be counsel subject to
the approval of the Issuer, which approval shall not be unreasonably withheld, and the payment of
expenses). Insofar as such action shall relate to any alleged liability with respect to which
indemnity may be sought against the Borrower, the Issuer or any such other indemnified person shall
have the right to employ separate counsel of their own choice in any such action and to participate
in the defense thereof, and the fees and expenses of such counsel shall be at the expense of the
Borrower. The Borrower shall not be liable to indemnify any person for any settlement of any such
action effected without its consent.



     The provisions of this Section shall survive payment and discharge of the Bonds.



     Section 6.8. Borrower Not to Adversely Affect Tax Exempt Status of Interest on
Project Bonds. The Borrower, for the benefit of the Issuer, the Trustee, the Bank and the
holders from time to time of the Project Bonds, hereby represents that it has not taken, or
permitted to be taken on its behalf, and agrees that it will not take, or permit to be taken on its
behalf, any action which would adversely affect the continued exemption from Federal income
taxation of the interest paid on the Project Bonds, and that it will take, or require to be taken,
such acts as may from time to time be required under applicable law or



19









 







regulation in effect on the
date of the original delivery of the Project Bonds to the Original Purchaser to preserve or
maintain the exemption from Federal income taxation of the interest on the Project Bonds.



ARTICLE VII




ASSIGNMENT




     Section 7.1. Assignment by Borrower. This Agreement may be assigned in whole or in
part by the Borrower, with the consent of the Bank but without the necessity of obtaining the
consent of either the Issuer or the Trustee, provided, however, that no such assignment shall be
made otherwise than in accordance with the Act as from time to time amended, and subject, however,
to each of the following conditions:




     (a) No assignment (other than with the express written consent of the Bank) shall
relieve the Borrower from primary liability for any of its obligations hereunder, and in the
event of any such assignment the Borrower shall continue to remain primarily liable for the
payment of the Loan Payments and Additional Payments and for performance and observance of
the agreements on its part herein provided to be performed and observed by it.




     (b) Any assignee from the Borrower shall assume in writing the obligations of the
Borrower hereunder to the extent of the interest assigned.




     (c) The Borrower shall, within thirty (30) days after execution thereof, furnish or
cause to be furnished to the Issuer, the Trustee and the Bank a true and complete copy of
each such assignment together with any instrument of assumption.




     (d) Any assignment from the Borrower shall not materially impair fulfillment of the
Project Purposes to be accomplished by operation of the Project.


Upon any such assignment, and with the express written consent of the Bank, the Borrower shall be
released from its obligations under this Agreement to the extent of the interest assumed by the
assignee.




     Section 7.2. Assignment by the Issuer. The Issuer shall assign its rights under and
interest in, and pledge the Revenues including, among other things, Loan Payments received under or
pursuant to, this Agreement, along with all of its right, title and interest in, to and under the
Note, to the Trustee pursuant to the Indenture and the Note, respectively, as security for payment
of the principal of and interest and any premium on the Bonds, and shall not make any further such
assignment or pledge except as may be necessary or required to enforce or secure payment of
principal of and interest and any premium on the Bonds.



ARTICLE VIII




TERMINATION AND PREPAYMENT




     Section 8.1. Option to Terminate. The Borrower shall have the option to terminate
this Agreement at any time when (i) the Indenture shall have been satisfied pursuant to its
provisions and (ii) sufficient moneys are on deposit with the Trustee, the Bank or the Issuer, as
appropriate, to meet all Additional Payments due or to become due through the date on which the
last of the Bonds are then scheduled to be retired or redeemed, or, with respect to Additional
Payments to become due, provisions



20









 







satisfactory to the Trustee, the Bank and the Issuer are made
for paying such amounts as they come due. Such option shall be exercised by the Borrower (a)
giving the Issuer, the Bank and the Trustee notice of such termination and (b) providing the Issuer
and the Trustee a certificate or opinion of Bond Counsel that such termination is proper.
Thereupon, such termination shall become effective.



     Section 8.2. Option to Prepay Loan. The Borrower shall have, and is hereby
granted the option, to prepay the Loan in full prior to the Termination Date and prior to the
payment and discharge of all the outstanding Bonds in accordance with the provisions of the
Indenture, if any of the following shall have occurred:




     (a) All or substantially all of the Project shall be damaged or destroyed and the
Borrower shall determine that it is not practicable or desirable to rebuild, repair or
restore the Project;




     (b) All or substantially all of the Project shall be condemned or such use or control
thereof shall be taken as to render the Project unsatisfactory to the Borrower for continued
operation; or




     (c) Unreasonable burdens or excessive liabilities shall be imposed upon the Issuer or
the Borrower with respect to the Project or the operation thereof.



     The mutual agreements contained in this Section 8.2 are independent of, and constitute an
agreement separate and distinct from, any and all provisions of this Agreement and shall be
unaffected by any fact or circumstances which might impair or be alleged to impair the validity of
any other provision.



     The Borrower shall have, and is hereby granted, an option, upon giving notice in accordance
with Section 8.4 hereof, to prepay all or part (in the principal amount of $5,000 or any integral
multiple thereof, provided that prior to the conversion to the Fixed Interest Rate the remaining
principal amount attributable to Bonds held by any single owner must be $100,000 or more) of the
Loan Payments due or to become due, subject to such terms, with such deposit requirements and on
the dates and at the prepayment prices as are set forth in Sections 2.1 and 2.6 hereof.



     Section 8.3. Obligation to Prepay Loan. The Borrower shall be obligated to prepay the
entire Loan prior to the expiration of this Agreement and prior to the full payment of the Bonds
(or prior to making provision for payment thereof in accordance with the Indenture) and to cancel
or terminate this Agreement if and when:




     (a) As a result of any changes in the Constitution of the State of Georgia or the
Constitution of the United States of America or of legislative or administrative action
(whether state or federal) or by final decree, judgment or order of any court or
administrative body (whether state or federal) entered after the contest thereof by the
Borrower in good faith, the Note and the obligations evidenced thereby shall have become
void or unenforceable or impossible of performance in accordance with the intent and
purposes of the parties as expressed in the Agreement; or




     (b) A final determination by the Internal Revenue Service or a court of competent
jurisdiction as a result of a proceeding in which the Borrower participates to the degree it
deems sufficient, which determination the Borrower, in its discretion, does not contest by
an appropriate proceeding, that, as a result of a failure by the Borrower to observe any
covenant, agreement or representation by the Borrower in the Agreement, the interest payable
on the Bonds or any of them is includable for federal income tax purposes in the gross
income of any owner or beneficial



21









 






owner of a Bond (other than an owner who is a “substantial
user” of the Project or a “related person” within the meaning of Section 147(a) of the
Internal Revenue Code of 1986 (the “Code”) and the applicable regulations thereunder); or




     (c) Upon the Expiration of the term of the Letter of Credit or the Confirming Letter of
Credit without any delivery of an Alternate Letter of Credit or Alternate Confirming Letter
of Credit, as the case may be, pursuant to Section 2.12 of this Agreement and the Indenture.



     Any such prepayment shall be made in the manner provided in Section 2.1 hereof on the Loan
Payment Date corresponding to the Bond Redemption Date fixed in accordance with the provisions of
the Indenture in an amount sufficient to pay the principal of and interest and any premium on the
Bonds to such Bond Redemption Date.



     Section 8.4. Notice of Prepayment. In order to exercise an option granted in,
or to consummate a prepayment required by, this Agreement, the Borrower shall, upon satisfying the
deposit requirements as set forth in Section 2.1 hereof, (i) within 30 days following the event
authorizing the exercise of such option or requiring such prepayment, or (ii) at least 30 days
prior to the date of the Borrower’s exercise of the option granted in the last paragraph of Section
8.2 hereof, give notice to the Issuer, the Trustee, the Remarketing Agent and the Bank, and shall
specify therein the date on which such prepayment is to be made, which date shall be not less than
30 days nor more than 90 days from the date such notice is mailed, and in case of a redemption of
the Bonds in accordance with the provisions of the Indenture, the Trustee shall give the required
notice of redemption, in which arrangements the Issuer and the Borrower shall cooperate.



     Section 8.5. Prepayment Price. In the case of prepayment of the entire Loan pursuant
to any provision of this Article, the prepayment price shall be the sum of the following:




     (a) To the Trustee, an amount of money equal to the amount of all principal, interest
and any premium required to be paid in connection with the corresponding redemption of Bonds
under the Indenture (plus any premium payable with respect to Bonds theretofore redeemed),
plus




     (b) to the Trustee or to the persons to whom Additional Payments are or will be due, an
amount of money equal to the Additional Payments accrued and which will accrue until final
maturity of the Bonds or until the appropriate redemption date if the Bonds are to be
redeemed; provided that this portion of such prepayment price will be deemed paid if
provisions acceptable to the Trustee, the Bank, the Remarketing Agent and the Issuer are
made for paying such Additional Payments as they become due.


The Issuer shall be entitled to rely upon a certificate or opinion of Bond Counsel that such funds
are sufficient for all purposes under this Agreement and the Indenture.




     Section 8.6. Relative Position of this Article and Indenture. The rights and options
granted to the Borrower in this Article shall be and remain prior and superior to the Indenture and
may be exercised whether or not the Borrower is in default hereunder; provided that such default
will not result in non-fulfillment of any condition to the exercise of any such right or option.



     Section 8.7. Concurrent Discharge of Note. In the event any of the Bonds shall be
paid and discharged pursuant to any provisions of this Agreement or the Indenture, so that such
Bonds are not thereafter outstanding within the meaning of the Indenture, an equivalent principal
amount of the corresponding Note or Notes shall be deemed fully paid for purposes of this Agreement
and to such extent the obligations of the Borrower thereunder terminated. In such event, the
assignee of the Note or



22









 







Notes shall take whatever steps are required to cause such Note or Notes,
or the pertinent installments of the principal sum thereof, to be canceled and deemed fully paid.



ARTICLE IX




EVENTS OF DEFAULT AND REMEDIES




     Section 9.1. Events of Default. The following shall be “events of default” under this
Agreement and the terms “event of default” or “default” shall mean, whenever they are used in this
Agreement, any one or more of the following events:




     (a) The occurrence of an event of default as defined in Section 9.01(a) or (b) of the
Indenture.




     (b) Failure by the Borrower to observe and perform any covenant, condition or agreement
on its part to be observed or performed hereunder, including failure to make Loan Payments
as required under Section 2.1 hereof, other than as referred to in paragraph (a) of this
Section, for a period of thirty (30) days after notice of such failure requesting such
failure to be remedied, given to the Borrower by the Issuer (who shall have no obligation to
do so), the Bank or the Trustee, unless the Bank and the Trustee shall agree in writing to
an extension of such time prior to its expiration; provided, however, that, if such default
is curable, and if and so long as the Borrower is proceeding with due diligence to cure the
default such period shall be extended for an additional 150 days to permit the Borrower to
cure such default.




     (c) Failure by the Borrower promptly to satisfy or cause to be set aside any execution,
garnishment or attachment of such consequence as will materially impair its ability to carry
out its obligations under this Agreement, or the filing by the Borrower of a petition for
the appointment of a receiver in liquidation or a trustee with respect to itself or any of
its property, or if either makes a voluntary assignment for the benefit of creditors or
files a petition in bankruptcy or insolvency or for reorganization, compromise, adjustment
or other relief under the laws of the United States or of any state relating to the relief
of debtors; or if any party other than the Borrower shall file a petition for the
appointment of a receiver in liquidation or a trustee with respect to the Borrower, or shall
file a petition against the Borrower in bankruptcy, insolvency, or for reorganization,
compromise, adjustment or other relief under the laws of the United States or any state
relating to the relief of debtors and such petition shall not be vacated or set aside or
stayed within sixty (60) days from the Borrower receiving notice thereof.




     (d) Any foreclosure of, or ousting of the Borrower from possession of, the Project or
any material portion thereof under any indenture of mortgage and deed of trust or any other
security interest given by the Borrower, or for any other reason.




     (e) The occurrence of an “Event of Default” (as defined in the Reimbursement Agreement)
under the Reimbursement Agreement.


The provisions of paragraph (b) of this Section are subject to the following limitations: If by
reason of acts of God; winds; fires; epidemics; landslides; floods; droughts; famines; strikes;
lockouts or other industrial disturbances; acts of public enemies; acts or orders of any kind of
any governmental authority; insurrection; military action; war, whether or not declared; sabotage;
riots; civil disturbances; explosions; breakage or accident to machinery, transmission pipes or
canals; partial or entire failure of utilities; or any cause or event not reasonably within the
control of the Borrower, the Borrower is unable in whole or in


23









 






part to carry out its agreements on
its part herein contained, other than the obligations on the part of the Borrower to pay Loan
Payments, Additional Payments and to carry insurance and to permit inspection of the Project; the
Borrower shall not be deemed in default for a period of thirty (30) days from the inception of such
inability; provided,
however, that, if such default is curable, and if and so long as the Borrower is proceeding with
due diligence to cure the default such period shall be extended to whatever reasonable period is
required to permit the Borrower to cure such default. The Borrower shall, however, use its best
efforts to remedy with all reasonable dispatch the cause or causes preventing the Borrower from
carrying out its agreements; provided, that the Borrower shall in no event be required to settle
strikes, lockouts or other industrial disturbances by acceding to the demands of the opposing party
or parties when such course is, in the judgment of the Borrower, not in the interest of the
Borrower.




     Section 9.2. Remedies on Default. Whenever any event of default under Section 9.1 of
this Agreement shall have happened and be subsisting, any one or more of the following remedial
steps may be taken; provided that in no event shall the Issuer or the Trustee be obligated to take
any step (except the Trustee shall take the actions necessary to make timely draws on the Letter of
Credit or a Confirming Letter of Credit) which in its opinion will or might cause it to expend time
or money or otherwise incur liability unless and until satisfactory indemnity has been furnished to
it:




     (a) The Trustee shall, if acceleration is declared pursuant to Section 9.02 of the
Indenture, declare all Loan Payments and Additional Payments payable hereunder for the
remainder of the term of this Agreement to be immediately due and payable, whereupon the
same shall become immediately due and payable.




     (b) In the event any of the Bonds shall at the time be outstanding and not paid and
discharged in accordance with the provisions of the Indenture, the Trustee shall have access
to and inspect, examine and make copies of the books and records and any and all accounts,
data and income tax and other tax returns of the Borrower, only, however, insofar as they
pertain to the Project or Project Site or any portion thereof, or to the Borrower’s
operations of the Project or at the Project Site.




     (c) The Trustee shall, at the direction of the Bank, pursue all remedies of a creditor
under the laws of the State.




     (d) The Trustee shall, at the direction of the Bank, take whatever action at law or in
equity shall appear necessary or desirable to collect the Loan Payments and Additional
Payments then due and thereafter to become due, or to enforce performance and observance of
any obligation, agreement or covenant of the Borrower under this Agreement.




     (e) The Trustee shall, at the direction of the Bank, exercise all remedies available
under the Indenture.


Any amounts collected as Loan Payments or applicable to Loan Payments and any other amounts which
would be applicable to payment of principal of and interest and any premium on the Bonds collected
pursuant to action taken under this Section shall be paid into the Bond Fund and applied in
accordance with the provisions of the Indenture or, if the outstanding Bonds have been paid and
discharged in accordance with the provisions of the Indenture, shall be paid first to the Bank in
satisfaction of any obligations of the Borrower to the Bank under the Reimbursement Agreement, then
as provided in Section 6.13 of the Indenture for transfers of remaining amounts in the Bond Fund.




     The provisions of this Section are subject to the further limitation that the rescission or
annulment of a declaration that all the Bonds outstanding under the Indenture are immediately due
and payable shall



24









 







also constitute rescission or annulment of any corresponding declaration made
pursuant to paragraph (a) of this Section and a waiver and rescission of the consequences of such
declaration and of the event of default with
respect to which such declaration had been made, provided that no such waiver or rescission
shall extend to or affect any subsequent or other default or impair any right consequent thereon.



     Section 9.3. No Remedy Exclusive. No remedy conferred upon or reserved to the Issuer
or the Trustee by this Agreement is intended to be exclusive of any other available remedy or
remedies, but each and every such remedy shall be cumulative and shall be in addition to every
other remedy given under this Agreement or now or hereafter existing at law or in equity or by
statute. No delay or omission to exercise any right or power accruing upon any default shall impair
any such right or power or shall be construed to be a waiver thereof, but any such right and power
may be exercised from time to time and as often as may be deemed expedient. In order to entitle the
Issuer or the Trustee to exercise any remedy reserved to it in this Article, it shall not be
necessary to give any notice, other than such notice as may be expressly required herein.



     Section 9.4. Agreement to Pay Attorneys’ Fees and Expenses. In the event the Borrower
should default under any of the provisions of this Agreement and the Issuer or the Trustee should
employ attorneys or incur other expenses for the collection of Loan Payments or the enforcement of
performance or observance of any obligation or agreement on the part of the Borrower contained in
this Agreement or in or represented by the Note, the Borrower shall on demand therefor reimburse
the reasonable fee of such attorneys and such other reasonable expenses so incurred. Any attorneys’
fees required to be paid by the Borrower under this Agreement shall include attorneys, fees through
all proceedings, including, but not limited to, negotiations, administrative hearings, trials and
appeals.



     Section 9.5. No Additional Waiver Implied by One Waiver. In the event any agreement
contained in this Agreement should be breached by either party and thereafter waived by the other
party, such waiver shall be limited to the particular breach so waived and shall not be deemed to
waive any other breach hereunder.



ARTICLE X




MISCELLANEOUS




     Section 10.1. Term of Agreement. This Agreement shall remain in full force and effect
from the date hereof to and including the Termination Date, or until such time as all of the Bonds
shall have been fully paid (or provision made for such payment pursuant to the Indenture),
whichever shall be earlier; provided, however, that this Agreement may be canceled and terminated
prior to said date if the Borrower shall prepay all of the Loan pursuant to Article VIII hereof.



     Section 10.2. Amounts Remaining in Bond Fund. If the Borrower shall pay and
discharge or provide for the payment or redemption and discharge of the whole amount of the
principal of, redemption premium, if any, and interest on the Bonds at the time Outstanding as
provided in the Indenture, or shall make arrangements satisfactory to the Trustee for such payment
or redemption and discharge, and shall pay or cause to be paid all other sums payable under this
Loan Agreement, then all right, title and interest of the Issuer and the Trustee under this Loan
Agreement shall thereupon cease, terminate and become void (except as provided in Section 10.1 of
this Loan Agreement), the Loan and the Bonds shall cease to be entitled to
any benefit under this
Loan Agreement and the Reimbursement Agreement, and all covenants, agreements and obligations of
the Company to the Trustee and the owners of the Bonds shall thereupon cease, terminate and become
void; provided that the owners of the Bonds shall be entitled to



25









 







payment thereof at the times and
in the manner stipulated therein and in the Indenture from the sources provided for such payment.



     Section 10.3. Notices. All notices, certificates, requests or other communications
hereunder shall be sufficiently given and shall be deemed given when mailed by registered or
certified mail, postage prepaid, addressed to the appropriate Notice Address. A duplicate copy of
each notice, certificate, request or other communication given hereunder to the Issuer, the
Borrower, the Original Purchaser, the Bank, the Remarketing Agent, or the Trustee shall also be
given to the others. The Borrower, the Issuer, the Original Purchaser, the Bank, the Remarketing
Agent, and the Trustee may, by notice given hereunder, designate a different Notice Address for it
other than the one specified in Section 14.04 of the Indenture.



     Section 10.4. Binding Effect. This Agreement shall inure to the benefit of and shall
be binding upon the Issuer, the Borrower and their respective successors and assigns, subject,
however, to the specific provisions hereof, and subject to the further limitation that any
obligation of the Issuer created by or arising out of this Agreement shall not be a general debt of
the Issuer or the State or any political subdivision or taxing district thereof, but shall be
payable solely as provided in Section 10.12 hereof.



     Section 10.5. Amendments, Changes and Modifications. Except as otherwise provided in
this Agreement or in the Indenture, subsequent to the issuance of the Project Bonds and prior to
all conditions provided for in the Indenture for release of the Indenture having been met, this
Agreement may not be effectively amended, changed, modified, altered or terminated without the
prior written consent of the Trustee, the Borrower and the Bank.



     Section 10.6. Counterparts. This Agreement may be executed in several counterparts,
each of which shall be regarded as an original and all of which shall constitute but one and the
same Agreement.



     Section 10.7. Severability. In case any clause, provision or section of this
Agreement, or any covenant, stipulation, obligation, agreement, act, or action, or part thereof,
made, assumed, entered into, or taken under this Agreement, or any application thereof, is for any
reason held to be illegal, invalid or inoperable, such illegality, invalidity, or inoperability
shall not affect the remainder thereof or any other clause, provision or section or any other
covenant, stipulation, obligation, agreement, act or action or part thereof, made, assumed, entered
into, or taken thereunder, which shall at the time be construed and enforced as if such illegal or
invalid or inoperable portion were not contained therein, nor shall such illegality or invalidity
or inoperability of any application thereof affect any legal and valid and operable application
thereof, from time to time, and each such clause, provision or section, covenant, stipulation,
obligation, agreement, act, or action, or part thereof shall be deemed to be effective, operative,
made, entered into or taken in the manner and to the full extent from time to time permitted by
law.



     Section 10.8. 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 10.9. Governing Law. This Agreement is governed by the laws of the State of
Georgia, without regard to the choice of law rules of the State of Georgia. Venue for any action
under this Agreement to which the Issuer is a party shall lie within the superior courts of the
State of Georgia, and the parties hereto consent to the jurisdiction and venue of any such court
and hereby waive any argument that venue in such forums is not convenient.



     Section 10.10. Selection of Alternate Letter of Credit. Notwithstanding
anything to the contrary contained herein or in the Indenture, the Borrower shall have the right to
secure an Alternate Letter of Credit or Alternate Confirming Letter of Credit at any time prior to
the issuance of a notice of redemption of the Bonds due to a termination of the Letter of Credit or
the Confirming Letter of Credit.



26









 





     Section 10.11. Continuing Obligation. This Agreement is a continuing obligation and
will (i) be binding upon the Borrower, its successors and assigns, and (ii) inure to the benefit of
and be enforceable by the Issuer and its successors, transferees and assigns; provided,
that the Borrower may not assign all or any part of this Agreement without the prior written
consent of the Bank. Except as set forth in the preceding sentence and except with respect to the
Bank and the holder(s) of any participation made by the Bank of this Agreement and the Letter of
Credit, no Person not a party to this Agreement will be entitled to the benefit of this Agreement.



     Section 10.12. Limitation on Issuer’s Liability. It is understood and agreed by the
Borrower and the Holders that no covenant, provision or agreement of the Issuer herein or in the
Bonds or in any other document executed by the Issuer in connection with the issuance, sale and
delivery of the Bonds, or any obligation herein or therein imposed upon the Issuer or breach
thereof, shall give rise to a pecuniary liability of the Issuer or a charge against the Issuer’s
general credit or general fund or shall obligate the Issuer financially in any way except with
respect to this Agreement and the application of Revenues therefrom and the proceeds of the Bonds.
No failure of the Issuer to comply with any term, condition, covenant or agreement contained in
this Agreement shall subject the Issuer to liability for any claim for damages, costs or other
financial or pecuniary charges except to the extent that the same can be paid or recovered from
this Agreement or the Revenues or proceeds of the Bonds. No execution on any claim, demand, cause
of action or judgment shall be levied upon or collected from the general credit or general funds of
the Issuer. In making the agreements, provisions and covenants set forth herein, the Issuer has
not obligated itself except with respect to this Agreement and the application of the Revenues as
hereinabove provided. The Bonds constitute special limited obligations of the Issuer, payable
solely from the Revenues pledged to the payment thereof pursuant to this Agreement and the
Indenture, and do not now and shall never constitute an indebtedness or a loan of the credit of the
Issuer, the State of Georgia or any political subdivision thereof within the meaning of any
constitutional or statutory provision whatsoever. The Issuer has no taxing power. It is further
understood and agreed by the Borrower and the Holders that the Issuer shall incur no pecuniary
liability hereunder and shall not be liable for any expenses related hereto. If, notwithstanding
the provisions of this Section, the Issuer incurs any expense, or suffers any losses, claims or
damages or incurs any liabilities, the Borrower will indemnify and hold harmless the Issuer from
the same and will reimburse the Issuer for any legal or other expenses incurred by the Issuer or
the State of Georgia in relation thereto, and this covenant to indemnify, hold harmless and
reimburse the Issuer shall survive delivery of and payment for the Bonds.



27









 





     IN WITNESS WHEREOF, the Issuer and the Borrower have caused this Agreement to be executed in
their respective names all as of the day and year first above written.



	 	 	 	 	 
	 	MITCHELL COUNTY DEVELOPMENT

AUTHORITY

 	 
	 	By:  	/s/ Charles Rooks
 	 
	 	 	Charles Rooks 	 
	 	 	Acting Chairman 	 



28









 






	 	 	 	 	 



	 	 	 	 	 
	 	FIRST UNITED ETHANOL, LLC,

a Georgia limited liability company

 	 
	 	By:  	/s/ Murray Campbell
 	 
	 	 	Murray Campbell 	 
	 	 	Chairman of the Board 	 



29









 






	 	 	 	 	 



EXHIBIT A




PROMISSORY NOTE




			
	 	 	 
	$29,000,000
	 	November 30, 2006
	 
	 	Pelham, Georgia






     FOR VALUE RECEIVED, the undersigned borrower, FIRST UNITED ETHANOL, LLC (the “Borrower”),
promises to pay to the order of the Mitchell County Development Authority (the “Lender”) the
principal sum of TWENTY NINE MILLION AND 00/100THS DOLLARS ($29,000,000) and to pay interest on the
unpaid balance of such principal sum, as hereinafter provided, until the payment of such principal
sum has been made or provided for.



     The Note has been executed and delivered by the Borrower to the Lender and assigned to Wells
Fargo Bank, National Association, as Trustee (the “Trustee”) pursuant to the Loan Agreement (the
“Agreement”), dated as of October 1, 2006, between the Lender and the Borrower. Under the
Agreement, the Lender has loaned to the Borrower the proceeds received from the sale of the
Lender’s $29,000,000 Variable Rate Demand Solid Waste Disposal Revenue Bonds (First United Ethanol,
LLC Project), Series 2006, initially dated the date of their authentication and delivery (the
“Bonds”), to assist the Borrower in the financing of the Project (as defined in the Agreement),
which Project is to be owned and operated by the Borrower, or its successors or assigns. The
Borrower has agreed (i) to repay the loan of the proceeds of the Bonds by making payments (the
“Loan Payments”) and (ii) to make the Additional Payments (as defined in the Indenture) at the
times and in the amounts set forth in this Note. The Bonds have been issued, concurrently with the
execution and delivery of this Note, pursuant to, and are secured by, the Trust Indenture (as
amended and supplemented from time to time, the “Indenture”), dated as of October 1, 2006, between
the Lender and the Trustee. The Bonds bear interest from their date at the Applicable Rate, as
defined in Appendix A to this Note, payable on each Interest Payment Date (as defined in the
Indenture), and mature on October 1, 2026.



     To provide funds to pay the interest on the Bonds as and when due, the Borrower hereby agrees
to and shall make payments of interest on this Note to the Trustee on the first Business Day prior
to the first day of each January, April, July and October commencing on the first Business Day
prior to the first day of January 2007, in an amount equal to the amount payable as interest on the
Bonds on the next Interest Payment Date; provided, however, that with respect to such first
interest payment, the Borrower shall receive a credit against such interest payment equal to the
amount, if any, of money in the Bond Fund (as defined in the Indenture) representing the Bond Fund
Payment (as defined in the Indenture).



     If payment or provision for payment in accordance with the Indenture is made in respect of the
principal of and redemption premium, if any, and interest on the Bonds, this Note shall be deemed
paid to the extent of such payment or provision for payment of Bonds. The Borrower shall receive a
credit against its obligation to make Loan Payments hereunder to the extent that there are amounts
already on deposit in the Bond Fund created by the Indenture (except for moneys drawn on the Letter
of Credit or the Confirming Letter of Credit), and available to pay principal or purchase price of
and premium, if any, and interest on the Bonds pursuant to the Indenture, and to the extent that
Loan Payments are made by the Borrower directly to the Bank pursuant to the Agreement. Subject to
the foregoing, all Loan Payments and Additional Payments shall be in the full amount required
hereunder and under the terms of the Agreement.



     All Loan Payments shall be payable in lawful money of the United States of America and shall
be made to the Trustee at its principal corporate trust office for the account of the Lender and
deposited in the



A-1









 




Bond Fund created by the Indenture. Except as otherwise provided in the Indenture, the Loan
Payments shall be used by the Trustee to pay the principal of and redemption premium, if any, and
interest on the Bonds as and when due or to reimburse the Bank for unreimbursed draws under the
Letter of Credit (as such terms are defined in the Indenture).




     The obligation of the Borrower to make the payments required hereunder shall be absolute and
unconditional and the Borrower shall make such payments without abatement, diminution or deduction
regardless of any cause or circumstances whatsoever including, without limitation, any defense,
set-off, recoupment or counterclaim which the Borrower may have or assert against the Lender, the
Trustee, the Bank or the Remarketing Agent (as defined in the Indenture) or any other person.



     This Note is subject to optional, extraordinary optional and mandatory prepayment upon
the same terms and conditions, on the same date or dates and at the same prepayment prices, as the
Bonds are subject to optional, extraordinary optional and mandatory redemption, and the Borrower
hereby agrees that it will make Loan Payments hereunder in an amount equal to the principal of and
premium, if any, and interest on the Bonds due and payable on any such redemption date. All
optional prepayments of amounts due under this Note are subject to the requirement that the
Borrower deposit sufficient moneys with the Bank in accordance with 2.1 of the Agreement prior to
the Borrower giving notice of its intention to so prepay pursuant to Section 8.4 of the Agreement.
Any such redemption prior to stated maturity is subject to the obligation of the Borrower to give
the Lender and the Trustee sufficient notice of such redemption as shall enable the Lender and the
Trustee to take all action necessary under the Indenture to redeem on the date specified for
prepayment a like principal amount of Bonds at the same redemption price.



A-2









 





     IN WITNESS WHEREOF, the Borrower has caused this Note to be executed in its name by its duly
authorized representative as of the date first written above.



	 	 	 	 	 
	 	FIRST UNITED ETHANOL, LLC,

a Georgia limited liability company

 	 
	 	By:  	
 	 
	 	 	Murray Campbell 	 
	 	 	Chief Executive Officer/Chairman of the Board 	 



A-3









 






	 	 	 	 	 




     The above Promissory Note is hereby pledged and assigned to Wells Fargo Bank, National
Association, as Trustee, without recourse, pursuant to the Trust Indenture dated as of October 1,
2006 between the Mitchell County Development Authority and the Trustee.



	 	 	 	 	 
	 	MITCHELL COUNTY DEVELOPMENT AUTHORITY

 	 
	 	By:  	
 	 
	 	 	Charles Rooks 	 
	 	 	Acting Chairman 	 



A-4









 






	 	 	 	 	 




     The Borrower hereby acknowledges and agrees to the aforesaid assignment of this Promissory
Note to the Trustee.



	 	 	 	 	 
	 	FIRST UNITED ETHANOL, LLC

a Georgia limited liability company

 	 
	 	By:  	
 	 
	 	 	Murray Campbell 	 
	 	 	Chief Executive Officer/Chairman of the Board 	 



A-5









 






	 	 	 	 	 



APPENDIX A





     As used in this Note, “Applicable Rate” shall mean at any time the then applicable interest
rate per annum on the Bonds as described below. The capitalized terms not defined in the Note shall
have the meanings ascribed to them in the Indenture.



     The Bonds will initially bear interest during the Accrual Period (herein defined) beginning on
the date of initial authentication and delivery of the Bonds. The Bonds will thereafter bear
interest at a Variable Rate per annum, which shall be the lesser of (i) the Maximum Interest Rate
or (ii) a fluctuating per annum rate equal to the per annum rate for the one-week period commencing
on a Thursday and ending on the Wednesday succeeding such Thursday (the “Accrual Period”)
determined by the Remarketing Agent (herein defined) by 12:00 noon, Portland, Oregon time, on the
Wednesday preceding the day on which the Accrual Period commences or, if such day of determination
is not a Business Day for the Remarketing Agent, on the first succeeding day which is a Business
Day (the “Determination Date”), to be equal to (but not more than) the rate required to be borne by
the Bonds for such Accrual Period to produce a bid for the purchase of all the Bonds on such
Determination Date at a price equal to the principal amount thereof plus accrued interest, if any,
thereon from the most recent Interest Payment Date. Notwithstanding the foregoing, the Accrual
Period beginning on the date of initial authentication and delivery of the Bonds shall commence on
such date and end on Wednesday, December 6, 2006. If for any reason the Variable Rate is not
determined as set forth above on any Determination Date, the interest rate announced on the
preceding Determination Date shall continue in effect. If for any reason the Variable Rate is not
so determined for a second succeeding week or thereafter, the Variable Rate shall thereafter be
determined by the Trustee and shall be a rate per annum (not to exceed the Maximum Interest Rate)
equal to twenty-five basis points in excess of the then current municipal swap index as quoted by
the Bond Market Association. Interest at the Variable Rate will be computed on the basis of a year
of 365 or 366 days, as appropriate, for the actual number of days elapsed, and will be payable on
the first Thursday of each January, April, July and October (each an “Interest Payment Date”), or,
if such day is not a Business Day, on the next succeeding Business Day, with such interest being
initially paid on January 4, 2007.



     With the prior written consent of the Bank, and upon receipt by the Trustee of an amendment to
the Letter of Credit increasing the amount available to be drawn for the payment of accrued
interest on the Bonds to two hundred (200) days of accrued interest on the then existing principal
balance of the Bonds at the Fixed Interest Rate, and upon receipt of an opinion of Bond Counsel
that such conversion will not adversely affect the excludability of interest on the Bonds from
gross income for Federal income tax purposes, on any Interest Payment Date (if such date is
designated by the Borrower as the Conversion Date), the Borrower may elect to convert the rate on
the Bonds to a fixed rate (the “Fixed Interest Rate”). The Borrower may exercise its conversion
option by giving the Trustee, the Bank, the Confirming Bank, the Paying Agent, the Tender Agent and
the Remarketing Agent written notice of its intention to convert the rate to the Fixed Interest
Rate, at least 50 days prior to the proposed Conversion Date.



     Subject to the provisions of the Indenture, on any Interest Payment Date (if such date is
designated by the Borrower as the Conversion Date), the Borrower may elect to convert the rate on
some or all of the Bonds to a fixed rate.



     On a day which is a Business Day at least fifteen (15) days prior to the Conversion Date, the
Remarketing Agent will determine the minimum rate of interest which will be applicable to the Bonds
on the ensuing Conversion Date, and at least twelve (12) days prior to such Conversion Date the
Paying Agent will notify all of the Bondholders by Mail of the aforesaid minimum rate of interest.
Bondholders shall deliver such Bonds to the Tender Agent on or before the Conversion Date. On a day
which is a



A-6









 







Business Day at least
seven (7) days prior to the Conversion Date (the “Rate Determination Date”) the Remarketing
Agent shall determine the Fixed Interest Rate. The Remarketing Agent shall determine the Fixed
Interest Rate on the Rate Determination Date to be that rate per annum which, if borne by all of
the outstanding Bonds through the Maturity Date, would, in the judgment of the Remarketing Agent
(taking into consideration current transactions and comparable securities in which the Remarketing
Agent is involved or of which it is aware and prevailing financial market conditions), be the
interest rate necessary (but which would not exceed the interest rate necessary) to produce as
nearly as practical a par bid for each outstanding Bond on the Rate Determination Date.



A-7









 





EXHIBIT B




Project




     The Project consists of certain solid waste disposal components of an ethanol refining
facility to be acquired, constructed and equipped on the Project Site.



 









 





EXHIBIT C




Project Site




[Legal Description to be supplied by counsel to the Borrower]





 









 








EXHIBIT D




CERTIFICATE OF COMPLETION




Wells Fargo Bank, National Association

Corporate Trust Services

MAC P6101-114

1300 SW 5th Avenue, 11th Floor

Portland, Oregon 97201





			
	Attention:     	 	Doreen K. Rowe

Corporate Trust Department






			
	     Re:	 	$29,000,000 Mitchell County Development Authority Variable Rate Demand Solid
Waste Disposal Revenue Bonds (First United Ethanol, LLC Project), Series 2006





     Reference is made to the Loan Agreement dated October 1, 2006 (the “Agreement”) between the
Mitchell County Development Authority (the “Issuer”) and First United Ethanol, LLC (the “Borrower”)
with respect to the Variable Rate Demand Solid Waste Disposal Revenue Bonds, Series 2006.
Undefined terms used herein shall have the meaning ascribed thereto in the Agreement and the Trust
Indenture dated October 1, 2006 between the Issuer and Wells Fargo Bank, National Association (the
“Trustee”).



     Pursuant to Section 3.2 of the Agreement, the undersigned certifies to the Issuer, the Trustee
and the Bank that he/she is an Authorized Borrower Representative and that, except for any amounts
retained by the Trustee at the direction of the Authorized Borrower Representative for any amount
of the costs set forth in Subsections 4.2(a) through (f) of the Agreement not then due and payable,




	 	1.	 	he/she has read Article III of the Agreement and the definitions therein
relating thereto;
	 
	 	2.	 	acquisition, construction and equipping of the Project have been substantially
completed and all labor, services, materials and supplies used in such acquisition,
construction and equipping have been paid for;
	 
	 	3.	 	all other facilities necessary in connection with the Project have been
acquired, constructed and equipped and all costs and expenses incurred in connection
therewith have been paid;
	 
	 	4.	 	all acquisition, construction and equipping of the Project and facilities
necessary thereto have been accomplished in such a manner as to conform with all
applicable zoning, planning, building, environmental and other similar regulations of
all governmental authorities having jurisdiction, and have been accomplished to the
satisfaction of the Borrower so as to permit efficient operation for the Project
Purposes,
	 
	 	5.	 	the date by which the foregoing three events have occurred is
______; and
	 
	 	6.	 	notwithstanding the foregoing, this certificate is given without prejudice to
any rights against third parties which exist or may subsequently arise.




 









 











Dated:                     




	 	 	 	 	 
	 	FIRST UNITED ETHANOL, LLC

a Georgia limited liability company

 	 
	 	By:  	 	 
	 	 	(Name) 	 
	 	 	(Title)