Exhibit 10.8.1




 





 


LOAN AGREEMENT


 


Between


 


IOWA FINANCE AUTHORITY


 


and


 


INTERWEST, L.C.


 


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


 


$5,000,000

IOWA FINANCE AUTHORITY
 VARIABLE RATE DEMAND INDUSTRIAL
DEVELOPMENT
 REVENUE BONDS (INTERWEST, L.C.
PROJECT),
 SERIES 2001


 


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


 


Dated as of November 1, 2001


 


Certain
of the interests of the Iowa Finance Authority, in this Loan Agreement have been
assigned to Wells Fargo Bank Northwest, National Association, as Trustee under
the Trust Indenture dated as of November 1, 2001, from the Iowa Finance
Authority.




 





 

















 


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

  	
   

  	
  2

  
	
  Section 1.2

  	
   

  	
  Definitions

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  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

  	
   

  	
  7

  
	
  Section 2.2

  	
   

  	
  Additional Payments

  	
   

  	
  8

  
	
  Section 2.3

  	
   

  	
  Notes

  	
   

  	
  9

  
	
  Section 2.4

  	
   

  	
  Assignment of Payments and Note

  	
   

  	
  10

  
	
  Section 2.5

  	
   

  	
  Obligations Unconditional

  	
   

  	
  10

  
	
  Section 2.6

  	
   

  	
  Prepayment of Loan and Additional Payments; Moneys
  for Optional Redemption

  	
   

  	
  11

  
	
  Section 2.7

  	
   

  	
  Past Due Loan Payments and Additional Payments

  	
   

  	
  11

  
	
  Section 2.8

  	
   

  	
  Redemption of Bonds

  	
   

  	
  11

  
	
  Section 2.9

  	
   

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

  	
   

  	
  11

  
	
  Section 2.10

  	
   

  	
  Assignment of Agreement and Revenues

  	
   

  	
  12

  
	
  Section 2.11

  	
   

  	
  Payments to Remarketing Agent

  	
   

  	
  12

  
	
  Section 2.12

  	
   

  	
  Letter of Credit and Confirming Letter of Credit;
  Alternate Letter of Credit and Alternate Confirming Letter of Credit

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACQUISITION, CONSTRUCTION, EQUIPPING AND

  OWNERSHIP OF THE PROJECT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.1

  	
   

  	
  Agreement to Acquire Construct and Equip The Project

  	
   

  	
  14

  
	
  Section 3.2

  	
   

  	
  Completion Date

  	
   

  	
  14

  
	
  Section 3.3

  	
   

  	
  Agreement as to Ownership of Project

  	
   

  	
  15

  
	
  Section 3.4

  	
   

  	
  Use of Project

  	
   

  	
  15

  
	
  Section 3.5

  	
   

  	
  Additional Bonds

  	
   

  	
  15

  



 


i

















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ISSUANCE OF BONDS; 

  APPLICATION OF PROCEEDS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.1

  	
   

  	
  Issuance of Bonds; Deposit of Bond Proceeds

  	
   

  	
  16

  
	
  Section 4.2

  	
   

  	
  Disbursements from the Project Fund

  	
   

  	
  16

  
	
  Section 4.3

  	
   

  	
  Obligation of the Parties to Cooperate In Furnishing
  Documents

  	
   

  	
  17

  
	
  Section 4.4

  	
   

  	
  Borrower Required to Pay Costs in Event Project Fund
  Insufficient

  	
   

  	
  18

  
	
  Section 4.5

  	
   

  	
  Investment of Fund Moneys

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MAINTENANCE; INSURANCE; DAMAGE; 

  DESTRUCTION AND EMINENT DOMAIN

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.1

  	
   

  	
  Maintenance

  	
   

  	
  19

  
	
  Section 5.2

  	
   

  	
  Removal of Portions of Project

  	
   

  	
  19

  
	
  Section 5.3

  	
   

  	
  Option to Release Portion of Project

  	
   

  	
  19

  
	
  Section 5.4

  	
   

  	
  Insurance Required

  	
   

  	
  19

  
	
  Section 5.5

  	
   

  	
  [Reserved]

  	
   

  	
  20

  
	
  Section 5.6

  	
   

  	
  Worker’s Compensation

  	
   

  	
  20

  
	
  Section 5.7

  	
   

  	
  Mechanic’s Liens

  	
   

  	
  20

  
	
  Section 5.8

  	
   

  	
  Damage, Destruction and Eminent Domain

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  WARRANTIES, REPRESENTATIONS AND COVENANTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.1

  	
   

  	
  Representations of the Issuer

  	
   

  	
  21

  
	
  Section 6.2

  	
   

  	
  Representations of the Company

  	
   

  	
  21

  
	
  Section 6.3

  	
   

  	
  [Reserved]

  	
   

  	
  22

  
	
  Section 6.4

  	
   

  	
  Financial Statements

  	
   

  	
  23

  
	
  Section 6.5

  	
   

  	
  Borrower’s Approval of Indenture

  	
   

  	
  23

  
	
  Section 6.6

  	
   

  	
  Right of Access

  	
   

  	
  23

  
	
  Section 6.7

  	
   

  	
  Indemnification

  	
   

  	
  23

  
	
  Section 6.8

  	
   

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

  	
   

  	
  23

  



 


ii

















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ASSIGNMENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.1

  	
   

  	
  Assignment by Borrower

  	
   

  	
  25

  
	
  Section 7.2

  	
   

  	
  Assignment by Issuer

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TERMINATION AND PREPAYMENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  8.1

  	
   

  	
  Option
  to Terminate

  	
   

  	
  26

  
	
  Section
  8.2

  	
   

  	
  Option
  to Prepay Loan

  	
   

  	
  26

  
	
  Section
  8.3

  	
   

  	
  Obligation
  to Prepay Loan

  	
   

  	
  26

  
	
  Section
  8.4

  	
   

  	
  Notice
  of Prepayment

  	
   

  	
  27

  
	
  Section
  8.5

  	
   

  	
  Prepayment
  Price

  	
   

  	
  27

  
	
  Section
  8.6

  	
   

  	
  Relative
  Position of this Article and Indenture

  	
   

  	
  28

  
	
  Section
  8.7

  	
   

  	
  Concurrent
  Discharge of Note

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EVENT OF DEFAULT AND REMEDIES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  9.1

  	
   

  	
  Events
  of Default

  	
   

  	
  29

  
	
  Section
  9.2

  	
   

  	
  Remedies
  on Default

  	
   

  	
  30

  
	
  Section
  9.3

  	
   

  	
  No
  Remedy Exclusive

  	
   

  	
  31

  
	
  Section
  9.4

  	
   

  	
  Agreement
  to Pay Attorneys’ Fees And Expenses

  	
   

  	
  31

  
	
  Section
  9.5

  	
   

  	
  No
  Additional Waiver Implied by One Waiver

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  10.1

  	
   

  	
  Term
  of Agreement

  	
   

  	
  32

  
	
  Section
  10.2

  	
   

  	
  Amounts
  Remaining in Bond Fund

  	
   

  	
  32

  
	
  Section
  10.3

  	
   

  	
  Notices

  	
   

  	
  32

  
	
  Section
  10.4

  	
   

  	
  Binding
  Effect

  	
   

  	
  32

  
	
  Section
  10.5

  	
   

  	
  Amendments,
  Changes and Modifications

  	
   

  	
  32

  
	
  Section
  10.6

  	
   

  	
  Counterparts

  	
   

  	
  32

  
	
  Section
  10.7

  	
   

  	
  Severability

  	
   

  	
  32

  
	
  Section
  10.8

  	
   

  	
  Captions

  	
   

  	
  33

  
	
  Section
  10.9

  	
   

  	
  Governing
  Law

  	
   

  	
  33

  
	
  Section
  10.10

  	
   

  	
  Selection
  of Alternate Letter of Credit

  	
   

  	
  33

  
	
  Section
  10.11

  	
   

  	
  Continuing
  Obligation

  	
   

  	
  33

  
	
  Section
  10.12

  	
   

  	
  Limitation
  on Issuer’s Liability

  	
   

  	
  33

  



 


iii

















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
   

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
   

  	
   

  	
  A-1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B

  	
   

  	
   

  	
   

  	
  B-1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit C

  	
   

  	
   

  	
   

  	
  C-1

  



 


iv

















 


LOAN AGREEMENT


 


Between


 


IOWA FINANCE AUTHORITY


 


and


 


INTERWEST, L.C.


 


THIS LOAN
AGREEMENT made and entered into as of the 1st day of November, 2001, between
the IOWA FINANCE AUTHORITY, a public instrumentality and agency of the State of
Iowa (hereinafter called the “Issuer”), and operating herein pursuant to the
provisions of the Act (as hereinafter defined), to carry out the public
purposes of the Issuer and the State of Iowa as set forth therein, and
INTERWEST, L.C., an Iowa domestic 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
Issuer has found and determined, and hereby finds and determines, that the
Project will serve a public purpose and will be of benefit to the health or
general welfare of the State, and negotiations have been carried on between the
Issuer and the Borrower with respect to the issuance by the Issuer of its
industrial development revenue bonds (hereinafter called the “Project Bonds”)
and the loan of the proceeds derived from the sale of the Project Bonds in
order to assist in the financing of certain manufacturing or processing
components to the Borrower’s soy methyl ester facility comprising the Project
to be owned and operated by the Borrower; and the Issuer has found and
determined, and hereby finds and determines, that the financing of the Project
as hereinabove described will promote the welfare of the people of the State,
stabilize the economy, provide employment, and assist in the development of
commercial activities to the benefit of the people of the State and will
provide additional opportunities for their gainful employment or preservation
of their employment, and that such financing is authorized by, and will be consistent
with and in furtherance of, the provisions of the laws of the State of Iowa,
particularly the Act (as defined herein); 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” means the
provisions of Chapter 16 of the Code of Iowa, as amended.


 


“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 November
1, 2001, 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.


 


“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.


 


2

















 


 “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 by the Issuer on the Bonds for such time
period or on such date.


 


“Borrower” means
InterWest, L.C., an Iowa domestic limited liability company, and its successors
and assigns, including any transferee partnership, corporation or other entity
as provided in Section 7.1 of this Agreement.


 


“Chair” means the
chair 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 3.2 of this Agreement.


 


“Confirming Bank”
means the same as that term is defined in the Indenture.


 


“Confirming Letter
of Credit” means the same as that term is defined in the Indenture.


 


“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 November 1, 2001, 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.


 


“Letter of Credit”
means the same as that term is defined 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.


 


3

















 


“Loan Payment Date”
means each Bond Redemption Date, each Interest Payment Date, each Principal
Payment Date, each Mandatory Tender 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 any fees, charges
and expenses of the Trustee and its counsel as provided in Section 10.02 of the
Indenture) 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.


 


“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-l or A-l 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 by
Moody’s or S & P, respectively;


 


4

















 


(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; or


 


(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.


 


“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.


 


“Principal Payment
Date” means, as to the Project Bonds, the first day of each November in the
years in which the Project Bonds mature as provided in the Indenture and any
Bond redemption date, and as to Additional Bonds, the date or dates identified
as such in the Bond Resolution authorizing such Additional Bonds.


 


“Project” means
the real, personal or real and personal property, including undivided or other
interests therein, identified in Exhibits B and C of this Agreement, or in or
pursuant to any amendments thereto or hereto or in the certificate of the
Authorized Borrower Representative, or acquired, constructed or installed as a
replacement or substitution therefor or an addition thereto.


 


“Project Bonds”
means the Bond or Bonds initially issued by the Issuer pursuant to the
Indenture and designated “$5,000,000 Iowa Finance Authority Variable Rate
Demand Industrial Development Revenue Bonds (InterWest, L.C. Project), Series
2001”.


 


“Project Purposes”
means the purposes of a soy methyl ester processing facility.


 


“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 Iowa.


 


“Termination Date”
means November 1, 2016, 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.


 


5

















 


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 Iowa
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 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.


 


6

















 


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 or in part and without premium or
penalty but with accrued interest to the date of such prepayment on the amount
prepaid.


 


Prior to
conversion to a Fixed Interest Rate, the Bonds are subject to optional
redemption by the Issuer in whole or in part in the principal amount of $5,000
or any integral multiple thereof (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, 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,


 


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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 Issuer and the
Borrower have provided for the payment of the principal of the Project Bonds,
upon maturity, redemption or acceleration, and up to 108 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 Issuer and the Borrower authorize 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,
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


 


8

















 


Agreement, or the
Indenture, or arising out of or based upon any other document 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 and behalf or in the name and
behalf of the Issuer, 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.


 


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;


 


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


 


(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
Issuer or 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 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


 


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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
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.


 


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 the principal amount of $5,000 or any integral
multiple thereof, provided that, if in the Variable Rate Period, 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 a: 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 the Issuer redeems any Project Bonds 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.


 


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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


 


(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 the
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, 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 the 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.


 


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


 


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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 any Confirming Letter of Credit or any Alternate
Confirming Letter of Credit to any successor Trustee pursuant to the Indenture.


 


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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.


 


(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


 


14

















 


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, or cause any action to be taken, 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.


 


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.


 


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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.


 


16

















 


(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 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 Issuer and the
Borrower agree 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. The
Issuer’s obligation is subject to any provisions of this


 


17

















 


Agreement or the
Indenture requiring additional documentation with respect to payments and shall
not extend beyond the moneys in the Project Fund available for payment under
the terms of the Indenture.


 


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 written request of the Authorized Borrower Representative be
invested or reinvested by the Trustee in Permitted Investments. The Issuer and
the Borrower jointly and severally covenant 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, 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. Any officer of the
Issuer having responsibility with respect to the issuance of the Bonds is
authorized and directed, alone or in conjunction with any other officer,
employee or consultant of the Issuer or the Borrower, and upon receipt of
reasonably satisfactory indemnities from the Borrower, to give an appropriate
certificate on behalf of the Issuer, for inclusion in the transcript of
proceedings for the Bonds, setting forth the facts, estimates and circumstances
and reasonable expectations pertaining to said Section 148 and regulations
thereunder, and to cause to be furnished a true transcript of certified
proceedings including all proceedings had with reference to the issuance of the
Bonds along with such other information as is necessary or proper with respect to
the Bonds.


 


18

















 


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 (selected in the manner provided in Section 5.4(1) hereof). 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 pursuant hereto shall be paid and
applied as provided in the Mortgage and the Reimbursement Agreement.


 


19

















 


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.


 


20

















 


ARTICLE VI


 


WARRANTIES, REPRESENTATIONS AND SPECIAL COVENANTS


 


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


 


(a)                    The Issuer is
a public instrumentality and agency of the State duly organized and existing
under and by virtue of 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 is directly or indirectly interested in this Agreement
or the issuance and sale of the Bonds.


 


(c)                    The issuance
and sale of the Bonds and the execution and delivery of this Agreement and the
Indenture have been duly authorized by resolutions of the governing body of the
Issuer adopted at meetings thereof duly called, by the affirmative vote of not
less than a majority of its members there present.


 


(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, 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 an Iowa domestic limited liability company duly formed and existing, in good
standing under the laws of the State of Iowa, and is not in violation of any
provision of its Articles of Organization or Operating Agreement 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,


 


21

















 


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 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 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.


 


Section 6.3.
[Reserved]


 


22

















 


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 releases the Issuer, the Trustee, the Bank, the Confirming Bank
and the Remarketing Agent from, agrees that the Issuer, the Remarketing Agent,
the Bank, the Confirming Bank and the Trustee shall not be liable for, and
agrees to hold the Issuer, the Trustee, the Bank, the Confirming Bank, the
Original Purchaser and the Remarketing Agent harmless against, any loss or
damage to property, or any injury to or death of any person, that may be
occasioned by any cause whatsoever pertaining to and arising out of the Project
or the use thereof during the Construction Period and while the Borrower is in
possession thereof. The Borrower further agrees to indemnify and save harmless
the Issuer, the Trustee, the Bank, the Confirming Bank, the Original Purchaser,
and the Remarketing Agent against and from any and all cost, liability,
expenses and claims arising from any breach or default on the part of the
Borrower in the performance of any covenant or agreement on the part of the
Borrower to be performed pursuant to the terms of this Agreement, or arising
from any act or failure to act by the Borrower or any of its agents,
contractors, servants, employees, or licensees, or arising from any accident,
injury or damage whatsoever caused to any person, firm or corporation occurring
during the term of this Agreement, on about the Project Site, and from and
against all cost, liability and expenses incurred in or in connection with any
such claim or action or proceeding brought thereon; and in case any action or
proceeding be brought against the Issuer, the Trustee, the Bank, the Confirming
Bank, the Original Purchaser, or the Remarketing Agent by reason of any such
claim, the Borrower upon notice from the Issuer, the Trustee, the Bank, the
Original Purchaser, or the Remarketing Agent covenants to resist or defend such
action or proceedings at the Borrower’s expense. Notwithstanding anything in
this Section 6.7 to the contrary, however, the Borrower’s agreement to
indemnify any other party hereunder shall not apply to any loss or damage to
property, or any injury to or death of any person, or any other cost,
liability, expense or claim that is due to the negligence, reckless conduct or
willful misconduct of such party.


 


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


 


23

















 


that it will take, or
require to be taken, such acts as may from time to time be required under
applicable law or 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.


 


24














 


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, 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, except for the Unassigned Rights of Issuer, 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.


 


25

















 


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 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 giving the Issuer, the Bank and the Trustee notice of such
termination and such termination shall thereupon 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 if in the Variable Rate Period 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:


 


26

















 


(a)                    As a result of
any changes in the Constitution of the State of Iowa 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 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 60 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


 


27

















 


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.


 


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 nonfulfillment 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 Issuer or any assignee of the Note or 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.


 


28

















 


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, the Bank or the Trustee, unless the Issuer, 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.


 


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


 


29

















 


unable in whole or in
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 as necessary to make timely draws on the Letter of Credit or
the 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 Issuer
shall, at the written request of the Trustee 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 Issuer or the Trustee
may 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 Issuer
may, at the direction of the Bank, pursue all remedies of a creditor under the
laws of the State.


 


(d)                   The Issuer or
the Trustee may, at the direction of the Bank, take whatever action at law or
in equity may 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
may, 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


 


30

















 


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 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.


 


31

















 


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.  Any amounts
in the Bond Fund remaining unclaimed by the holders of Bonds for three years
after the due date (whether at maturity or by redemption or otherwise) thereof,
shall be paid first to the Bank in satisfaction of any outstanding obligations
of the Borrower to the Bank under the Reimbursement Agreement and any amount
remaining thereafter shall be paid to the Borrower by the Trustee. With respect
to the principal of and interest and any premium on the Bonds to be paid from
moneys paid to the Borrower or the Bank pursuant to this Section the holders of
the Bonds entitled to such moneys shall look solely to the Borrower for the
payment of such moneys.


 


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 out of the Revenues.


 


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,


 


32

















 


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 shall be deemed
to be a contract made under the laws of the State and for all purposes shall be
governed by and construed in accordance with the laws of the State.


 


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.


 


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 its 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 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 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 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


 


33

















 


never constitute an
indebtedness or a loan of the credit of the Issuer, the State of Iowa 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.


 


34

















 


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.


 


	
   

  	
   

  	
  IOWA FINANCE AUTHORITY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ MICHAEL L.
  TRAMONTINA

  	
   

  
	
   

  	
   

  	
   

  	
        Michael
  L. Tramontina 

        Executive Director

  



 


35

















 


	
   

  	
   

  	
  INTERWEST,
  L.C.

  an Iowa domestic limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ NILE RAMSBOTTOM

  	
   

  
	
   

  	
   

  	
   

  	
       Nile Ramsbottom 
      President

  



 


36

















 


EXHIBIT A


 


PROMISSORY NOTE


 


 


	
  $5,000,000

  	
  November 15,
  2001

  Ralston, Iowa

  



 


FOR VALUE
RECEIVED, the undersigned borrower, INTERWEST, L.C. (the “Borrower”), promises
to pay to the order of the Iowa Finance Authority (the “Lender”) the principal
sum of FIVE MILLION AND 00/100THS DOLLARS ($5,000,000) 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 Northwest, National Association, as Trustee (the “Trustee”) pursuant
to the Loan Agreement (the “Agreement”), dated as of November 1, 2001, 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 $5,000,000
Variable Rate Demand Industrial Development Revenue Bonds (InterWest, L.C.
Project), Series 2001, 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. The Borrower has agreed to repay the loan of the proceeds of the
Bonds by making payments (the “Loan Payments”) 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 November 1, 2001, 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 November 1, 2016.


 


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, or to the
Letter of Credit Bank if so required by the Reimbursement Agreement, as
follows: (a) during the Variable Rate Period (as defined in the Indenture), on
the third (3rd) Business Day prior to February 1, 2002, and on the
third (3rd) Business Day prior to the first day of each successive third
(3rd) month thereafter, in an amount equal to the amount then
estimated by the Trustee to be payable as interest on the Bonds on the next
succeeding quarterly Interest Payment Date; and (b) while the Bonds bear
interest at the Fixed Interest Rate (as defined in the Indenture), on the third
(3rd) Business Day prior to the next succeeding semi-annual Interest
Payment Date, the amount then estimated by the Trustee to be payable as
interest on the Bonds on the next succeeding semi-annual Interest Payment Date;
provided, however, that with respect to such first interest payment on this
Note, 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


 


A-1

















 


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
shall be in the full amount required hereunder.


 


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 Issuer and deposited in the 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 Issuer
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.


 


	
   

  	
   

  	
  INTERWEST, L.C.

  an Iowa domestic limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (Name)

  (Title)   

  	
   

  



 


 


The above
Promissory Note is hereby pledged and assigned to the Wells Fargo Bank
Northwest, National Association, as Trustee, without recourse, pursuant to the
Trust Indenture dated as of November 1, 2001 between the Iowa Finance Authority
and the Trustee.


 


	
   

  	
   

  	
  IOWA FINANCE AUTHORITY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: November        ,
  2001

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
        Michael
  L. Tramontina 

        Executive Director

  



 


 


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


 


	
   

  	
   

  	
  INTERWEST, L.C.

  an Iowa domestic limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (Name)

  (Title)   

  	
   

  



 


A-3

















 


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 next preceding 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, November 21, 2001. 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
February, 2002, and on each third month thereafter (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 February 7, 2002.


 


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.


 


A-4

















 


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 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-5

















 


EXHIBIT B


 


Project


 


The Project
consists of certain components to the Borrower’s soy methyl ester processing
facility to be acquired, constructed and equipped on the Project Site.


 


B-1

















 


EXHIBIT C


 


Project Site


 


 


Lot A of Lot Two (2),
Northeast Quarter of the Northwest Quarter (NE1⁄4 NW1⁄4) and Lot A of Lot One (1),
Southeast Quarter of the Northwest Quarter (SE1⁄4 NW1⁄4), Section Thirty-six (36), Township Eighty-four (84) North,
Range Thirty-three (33) West of the 5th P.M., Carroll County, Iowa.


 


C-1