Document:

Exhibit
4.2

 

GILMORE & BELL, P.C.

Execution Copy

 

 

CITY OF ATCHISON, KANSAS

AS ISSUER

AND

COMMERCE BANK, N.A.

KANSAS CITY, MISSOURI

AS TRUSTEE

 

 

TRUST INDENTURE

DATED AS OF THE ISSUE DATE OF THE
BONDS

$7,000,000

TAXABLE INDUSTRIAL REVENUE BONDS

SERIES 2006

(MGP INGREDIENTS PROJECT)

 

 

 

 

TRUST INDENTURE

Table of Contents

	
  

  	
   

  	
  Page

  
	
  Parties

  	
   

  	
  1

  
	
  Recitals

  	
   

  	
  1

  
	
  Granting Clauses

  	
   

  	
  2

  

 

ARTICLE I

DEFINITIONS

	
  Section 101.

  	
   

  	
  Definitions of Words and Terms

  	
   

  	
  3

  
	
  Section 102.

  	
   

  	
  Rules of Interpretation

  	
   

  	
  3

  

 

ARTICLE II

THE BONDS

	
  Section 201.

  	
   

  	
  Title and Amount of Bonds

  	
   

  	
  3

  
	
  Section 202.

  	
   

  	
  Limited Nature of Obligations

  	
   

  	
  4

  
	
  Section 203.

  	
   

  	
  Denomination, Numbering and Dating of Bonds

  	
   

  	
  4

  
	
  Section 204.

  	
   

  	
  Method and Place of Payment of Bonds

  	
   

  	
  5

  
	
  Section 205.

  	
   

  	
  Execution and Authentication of Bonds

  	
   

  	
  5

  
	
  Section 206.

  	
   

  	
  Registration, Transfer and Exchange of Bonds

  	
   

  	
  5

  
	
  Section 207.

  	
   

  	
  Persons Deemed Owners of Bonds

  	
   

  	
  6

  
	
  Section 208.

  	
   

  	
  Authorization of Series 2006 Bonds

  	
   

  	
  7

  
	
  Section 209.

  	
   

  	
  Authorization of Additional Bonds

  	
   

  	
  8

  
	
  Section 210.

  	
   

  	
  Temporary Bonds

  	
   

  	
  10

  
	
  Section 211.

  	
   

  	
  Mutilated, Lost, Stolen or Destroyed Bonds

  	
   

  	
  10

  
	
  Section 212.

  	
   

  	
  Cancellation and Destruction of Bonds Upon Payment

  	
   

  	
  11

  

 

ARTICLE III

REDEMPTION OF BONDS

	
  Section 301.

  	
   

  	
  Redemption of Bonds Generally

  	
   

  	
  11

  
	
  Section 302.

  	
   

  	
  Redemption of Series 2006 Bonds

  	
   

  	
  11

  
	
  Section 303.

  	
   

  	
  Section of Bonds to be Redeemed

  	
   

  	
  11

  
	
  Section 304.

  	
   

  	
  Trustee’s Duty to Redeem Bonds

  	
   

  	
  12

  
	
  Section 305.

  	
   

  	
  Notice of Redemption

  	
   

  	
  12

  
	
  Section 306.

  	
   

  	
  Effect of Call for Redemption

  	
   

  	
  13

  

 

 i
 

 

ARTICLE
IV

FORM OF
BONDS

	
  Section 401.

  	
   

  	
  Forms Generally

  	
   

  	
  13

  
	
  Section 402.

  	
   

  	
  Form of Bond Counsel’s Approving Opinion

  	
   

  	
  13

  

 

ARTICLE V

CUSTODY AND APPLICATION
OF BOND PROCEEDS

	
  Section 501.

  	
   

  	
  Creation of Project Fund

  	
   

  	
  14

  
	
  Section 502.

  	
   

  	
  Deposits into the Project Fund

  	
   

  	
  14

  
	
  Section 503.

  	
   

  	
  Disbursements from the Project Fund

  	
   

  	
  14

  
	
  Section 504.

  	
   

  	
  Disposition Upon Completion of the Improvements

  	
   

  	
  15

  
	
  Section 505.

  	
   

  	
  Disposition Upon Acceleration

  	
   

  	
  15

  

 

ARTICLE IV

REVENUES AND FUNDS

	
  Section 601.

  	
   

  	
  Creation of the Debt Service Fund

  	
   

  	
  15

  
	
  Section 602.

  	
   

  	
  Deposits into the Debt Service Fund

  	
   

  	
  15

  
	
  Section 603.

  	
   

  	
  Application of Moneys in the Debt Service Fund

  	
   

  	
  16

  
	
  Section 604.

  	
   

  	
  Payments Due on Saturdays, Sundays and Holidays

  	
   

  	
  17

  
	
  Section 605.

  	
   

  	
  Nonpresentation of Bonds

  	
   

  	
  17

  

 

ARTICLE VIII

SECURITY FOR DEPOSITS AND
INVESTMENT OF FUNDS

	
  Section 701.

  	
   

  	
  Moneys to be Held in Trust

  	
   

  	
  17

  
	
  Section 702.

  	
   

  	
  Investment of Moneys in Funds

  	
   

  	
  17

  
	
  Section 703.

  	
   

  	
  Record Keeping

  	
   

  	
  18

  

 

ARTICLE VIII

GENERAL COVENANTS AND
PROVISIONS

	
  Section 801.

  	
   

  	
  Payment of Principal of, Premium, if any, and
  Interest on the Bonds

  	
   

  	
  18

  
	
  Section 802.

  	
   

  	
  Authority to Execute Indenture and Issue Bonds

  	
   

  	
  19

  
	
  Section 803.

  	
   

  	
  Performance of Covenants

  	
   

  	
  19

  
	
  Section 804.

  	
   

  	
  Instruments of Further Assurance

  	
   

  	
  19

  
	
  Section 805.

  	
   

  	
  Maintenance, Taxes and Insurance

  	
   

  	
  19

  
	
  Section 806.

  	
   

  	
  Inspection of Project Books

  	
   

  	
  19

  
	
  Section 807.

  	
   

  	
  Enforcement of Rights Under the Lease

  	
   

  	
  19

  
	
  Section 808.

  	
   

  	
  Possession and Use of Land

  	
   

  	
  20

  

 

 ii
 

 

ARTICLE IX

REMEDIES ON DEFAULT

	
  Section 901.

  	
   

  	
  Acceleration of Maturity in Event of Default

  	
   

  	
  20

  
	
  Section 902.

  	
   

  	
  Exercise of Remedies by the Trustee

  	
   

  	
  20

  
	
  Section 903.

  	
   

  	
  Limitation on Exercise of Remedies by Bondowners

  	
   

  	
  21

  
	
  Section 904.

  	
   

  	
  Right of Bondowners to Direct Proceedings

  	
   

  	
  21

  
	
  Section 905.

  	
   

  	
  Remedies Cumulative

  	
   

  	
  22

  
	
  Section 906.

  	
   

  	
  Waivers of Events of Default

  	
   

  	
  22

  
	
  Section 907.

  	
   

  	
  Application of Money Received after Event of Default

  	
   

  	
  22

  

 

ARTICLE X

THE TRUSTEE

	
  Section 1001.

  	
   

  	
  Acceptance of the Trusts

  	
   

  	
  23

  
	
  Section 1002.

  	
   

  	
  Fees, Charges and Expenses of the Trustee; Lien for
  Fees and Costs and Additional Rent

  	
   

  	
  25

  
	
  Section 1003.

  	
   

  	
  Notice to Bondowners if Default Occurs

  	
   

  	
  25

  
	
  Section 1004.

  	
   

  	
  Intervention by the Trustee

  	
   

  	
  26

  
	
  Section 1005.

  	
   

  	
  Successor Trustee Upon Merger; Consolidation or Sale

  	
   

  	
  26

  
	
  Section 1006.

  	
   

  	
  Resignation of Trustee

  	
   

  	
  26

  
	
  Section 1007.

  	
   

  	
  Removal of Trustee

  	
   

  	
  26

  
	
  Section 1008.

  	
   

  	
  Qualifications of Successor Trustee

  	
   

  	
  26

  
	
  Section 1009.

  	
   

  	
  Vesting of Trusts in Successor Trustee

  	
   

  	
  26

  
	
  Section 1010.

  	
   

  	
  Right of Trustee to Pay Taxes and Other Charges

  	
   

  	
  27

  
	
  Section 1011.

  	
   

  	
  Trust Estate May Be Vested in Co-trustee

  	
   

  	
  27

  
	
  Section 1012.

  	
   

  	
  Annual Accounting

  	
   

  	
  28

  
	
  Section 1013.

  	
   

  	
  Recordings and Filings

  	
   

  	
  28

  
	
  Section 1014.

  	
   

  	
  Performance of Duties under the Lease

  	
   

  	
  28

  

 

ARTICLE XI

SUPPLEMENTAL INDENTURES

	
  Section 1101.

  	
   

  	
  Supplemental Indentures Not Requiring Consent of
  Bondowners

  	
   

  	
  28

  
	
  Section 1102.

  	
   

  	
  Supplemental Indentures Requiring Consent of
  Bondowners

  	
   

  	
  29

  
	
  Section 1103.

  	
   

  	
  Tenant’s Consent to Supplemental Indentures

  	
   

  	
  29

  

 

 iii
 

 

ARTICLE XII

LEASE AMENDMENTS

	
  Section 1201.

  	
   

  	
  Lease Amendments

  	
   

  	
  30

  

 

ARTICLE XIII

SATISFACTION AND DISCHARGE
OF INDENTURE

	
  Section 1301.

  	
   

  	
  Satisfaction and Discharge of the Indenture

  	
   

  	
  30

  
	
  Section 1302.

  	
   

  	
  Bonds Deemed to be Paid

  	
   

  	
  30

  

 

ARTICLE XIV

MISCELLANEOUS PROVISIONS

	
  Section 1401.

  	
   

  	
  Consents and Other Instruments by Bondowners

  	
   

  	
  31

  
	
  Section 1402.

  	
   

  	
  Limitation of Rights Under the Indenture

  	
   

  	
  32

  
	
  Section 1403.

  	
   

  	
  Notices

  	
   

  	
  32

  
	
  Section 1404.

  	
   

  	
  Suspension of Mail Service

  	
   

  	
  32

  
	
  Section 1405.

  	
   

  	
  Severability

  	
   

  	
  32

  
	
  Section 1406.

  	
   

  	
  Execution in Counterparts

  	
   

  	
  33

  
	
  Section 1407.

  	
   

  	
  Governing Law

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Signatures and Acknowledgments

  	
   

  	
  34

  
	
  Schedule I, Description of Property

  	
   

  	
  S-1

  
	
  Appendix A, Form of Bonds

  	
   

  	
  A-1

  
	
  Appendix B, Glossary of Words and Terms

  	
   

  	
  B-1

  

 

 iv

TRUST INDENTURE

THIS TRUST INDENTURE, dated as of the Issue Date of the Series 2006
Bonds (the ”Indenture”), between the City of Atchison, Kansas (the “Issuer”),
and Commerce Bank, N.A., Kansas City, Missouri (the “Trustee”);

WITNESSETH:

WHEREAS, the Issuer is authorized by K.S.A. 12-1740 et seq., as amended (the “Act”), to acquire, construct,
improve and equip certain facilities (as defined in the Act) for commercial,
industrial and manufacturing purposes, and to enter into leases and lease-purchase
agreements with any person, firm or corporation for said facilities, and to
issue revenue bonds for the purpose of paying the cost of any such facilities;
and

WHEREAS, pursuant to such authorization, the Issuer’s
governing body has passed an ordinance authorizing the Issuer to issue its
Taxable Industrial Revenue Bonds, Series 2006 (MGP Ingredients Project),
in the principal amount of $7,000,000 (the “Series 2006 Bonds”), for the
purpose of acquiring, constructing and equipping an office building and
technical center facility (jointly, the “Project” as hereinafter more fully
described), and authorizing the Issuer to lease the Project to MGP INGREDIENTS,
INC., a Kansas corporation (the “Tenant”); and

WHEREAS, pursuant to such ordinance, the Issuer is
authorized (i) to execute and deliver this Indenture for the purpose of issuing
and securing the Series 2006 Bonds and any Additional Bonds (collectively the “Bonds”),
as hereinafter provided, and (ii) to enter into a Lease of even date herewith
(the “Lease”), between the Issuer and the Tenant, pursuant to which Issuer
shall lease the Project to the Tenant, in consideration of rentals which are
intended to be sufficient to provide for the payment of the principal of,
premium, if any, and interest on the Series 2006 Bonds as the same become due;
and

WHEREAS, all things necessary to make the Series 2006
Bonds, when authenticated by the Trustee and issued as provided in this
Indenture, the valid and legally binding limited obligations of the Issuer, and
to make this Indenture a valid and legally binding pledge and assignment of the
Trust Estate herein made for the security of the payment of the principal of,
premium, if any, and interest on the Bonds issued hereunder, have been done and
performed, and the execution and delivery of this Indenture and the execution
and issuance of the Series 2006 Bonds, subject to the terms hereof, have in all
respects been duly authorized;

NOW, THEREFORE, THIS INDENTURE
WITNESSETH:

GRANTING CLAUSES

That the Issuer, in consideration of the premises,
the acceptance by the Trustee of the trusts hereby created, the purchase and
acceptance of the Series 2006 Bonds by the Tenant, as Original Purchaser
thereof, and of other good and valuable consideration, the receipt of which is
hereby acknowledged, and in order to secure the payment of the principal of,
premium, if any, and interest 

on all of the Bonds issued and Outstanding under this Indenture from
time to time according to their tenor and effect, and to secure the performance
and observance by the Issuer of all the covenants, agreements and conditions
herein and in the Bonds contained, does hereby pledge and assign unto the
Trustee and its successors and assigns, and grant to the Trustee and its
successors and assigns a security interest in the property described in
paragraphs (a), (b) and (c) below (said property being herein referred to
as the “Trust Estate”), to wit:

(a)  The real property or interests
therein situated in Atchison County, Kansas, described in Schedule I
attached hereto and constituting the Land (as defined herein), with all
Improvements (as defined herein) now or hereafter located thereon, to the
extent and subject to the limitations provided in the Lease, with the
tenements, hereditaments, appurtenances, rights, privileges and immunities
thereunto belonging or appertaining.

(b)  All right, title and interest of
the Issuer in, to and under the Lease (except the Issuer’s right to indemnity
thereunder), and all rents, revenues and receipts derived by the Issuer from
the Project including, without limitation, all Basic Rent derived by the Issuer
under and pursuant to and subject to the provisions of the Lease; provided that
the pledge and assignment hereby made shall not impair or diminish the
obligations of the Issuer under the provisions of the Lease.

(c)  All moneys and securities held by
the Trustee under the terms of this Indenture, and any and all other real or
personal property of every kind and nature from time to time hereafter, by
delivery or by writing of any kind, pledged, assigned or transferred as and for
additional security hereunder by the Issuer, by the Tenant or by anyone in
their behalf, or with their written consent, to the Trustee, which is hereby
authorized to receive any and all such property at any and all times and to
hold and apply the same subject to the terms hereof.

TO HAVE AND TO HOLD, all and singular, the Trust Estate with all
rights and privileges hereby pledged and assigned, or agreed or intended so to
be, to the Trustee and its successors in trust and assigns;

IN TRUST NEVERTHELESS, upon the terms and subject to the conditions
herein set forth, for (i) the equal and proportionate benefit, protection and
security of the Series 2006 Bonds (herein defined) and any Additional Bonds
issued and Outstanding under this Indenture, without preference, priority or
distinction as to lien or otherwise of any of the Bonds (herein defined) over
any other of the Bonds except as expressly provided in or permitted by this
Indenture;

PROVIDED, HOWEVER, that if the Issuer shall pay, or cause to be
paid, the principal of, premium, if any, and interest on all the Bonds, at the
times and in the manner mentioned in the Bonds according to the true intent and
meaning thereof, or shall provide for the payment thereof (as provided in Article XIII hereof), and shall pay or cause to be paid to
the Trustee all other sums of money due or to become due to it in accordance
with the terms and provisions hereof, then upon such final payments this
Indenture and the rights hereby granted shall cease, determine and be void;
otherwise, this Indenture shall be and remain in full force and effect.

THIS INDENTURE FURTHER
WITNESSETH, and it is
hereby expressly declared, covenanted and agreed by and between the parties
hereto, that all Bonds issued and secured 

 2
 

hereunder are to be issued, authenticated and delivered and that all the
Trust Estate is to be held and applied under, upon and subject to the terms,
conditions, stipulations, covenants, agreements, trusts, uses and purposes as
hereinafter expressed, and the Issuer does hereby agree and covenant with the
Trustee and with the respective Owners from time to time of the Bonds, as
follows:

ARTICLE I

DEFINITIONS

Section 101.  Definitions
of Words and Terms.  In
addition to the words and terms defined elsewhere in this Indenture, the
capitalized words and terms used in this Indenture and in the Lease shall have
the meanings assigned in the Glossary attached hereto as Appendix B,
unless some other meaning is plainly intended.

Section 102.  Rules of
Interpretation.

(a)  Words of the masculine gender shall
be deemed and construed to include correlative words of the feminine and neuter
genders.  Unless the context shall
otherwise indicate, the words importing the singular number shall include the
plural and vice versa, and words importing persons shall include firms,
associations, trusts and corporations, including public bodies, as well as
natural persons.

(b)  Wherever in this Indenture it is
provided that either party shall or will make any payment or perform or refrain
from performing any act or obligation, each such provision shall, even though
not so expressed, be construed as an express covenant to make such payment or
to perform, or not to perform, as the case may be, such act or obligation.

(c)  All references in this instrument
to designated “Articles”, “Sections” and other subdivisions are, unless
otherwise specified, to the designated Articles, Sections and subdivisions of
this instrument as originally executed. 
The words “herein”, “hereof”, “hereunder” and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or subdivision.

(d)  The Table of Contents and the
Article and Section headings of this Indenture shall not be treated as a part
of this Indenture or as affecting the true meaning of the provisions hereof.

ARTICLE II

THE BONDS

Section 201.  Title and Amount of Bonds. 
No Bonds may be issued under this Indenture except in accordance with
the provisions of this Article.  The
Bonds authorized to be issued under this Indenture shall be designated as “City
of Atchison, Kansas Taxable Industrial Revenue Bonds, 

 3
 

Series 2006 (MGP Ingredients
Project),” with such other appropriate particular designation added to or
incorporated in such title for the Bonds of any particular series of Additional
Bonds as the Issuer may determine.  The
total principal amount of Bonds that may be issued hereunder is hereby
expressly limited to the $7,000,000 principal amount of Series 2006 Bonds and
any Additional Bonds permitted hereunder.

Section 202.  Limited
Nature of Obligations.

(a)  The Bonds and the interest thereon
shall be limited obligations of the Issuer payable solely and only from the net
earnings and revenues derived by the Issuer from the Project, including but not
limited to the rents, revenues and receipts under the Lease, and are secured by
a pledge and assignment of the Trust Estate to the Trustee in favor of the
Bondowners, as provided in this Indenture. 
The Bonds and the interest thereon shall not be a debt or general
obligation of the Issuer or the State, or any municipal corporation thereof,
and neither the Bonds, the interest thereon, nor any judgment thereon or with
respect thereto, are payable in any manner from tax revenues of any kind or
character.  The Bonds shall not
constitute an indebtedness or a pledge of the faith and credit of the Issuer,
the State or any municipal corporation thereof, within the meaning of any
constitutional or statutory limitation or restriction.

(b)  No provision, covenant or agreement
contained in this Indenture or the Bonds, or any obligation herein or therein
imposed upon the Issuer, or the breach thereof, shall constitute or give rise
to or impose upon the Issuer a pecuniary liability or a charge upon its general
credit or powers of taxation.  In making
the agreements, provisions and covenants set forth in this Indenture, the
Issuer has not obligated itself except with respect to the Project and the
application of the payments, revenues and receipts therefrom as hereinabove
provided.  Neither the officers of the
Issuer nor any person executing the Bonds shall be liable personally on the
Bonds by reason of the issuance thereof.

Section 203.  Denomination,
Numbering and Dating of Bonds.

(a)  The Bonds shall be fully registered
Bonds in the denomination of $5,000 or any integral multiple thereof not
exceeding the principal amount of the Bonds maturing on any Principal Payment
Date.  The Bonds shall be substantially
in the form set forth in Article IV of
this Indenture. The Bonds of each series of Bonds shall be numbered in such
manner as the Trustee shall determine.

(b)  The Bonds of each series of Bonds
shall be dated as provided in this Indenture or the Supplemental Indenture
authorizing the issuance of such series of Bonds.  The Bonds shall bear interest from their
effective date of registration. The effective date of registration shall be the
Interest Payment Date next preceding the date of authentication thereof by the
Trustee, unless such date of authentication shall be an Interest Payment Date,
in which case the effective date of registration shall be as of such date of
authentication, or unless the date of authentication shall be prior to the
first Interest Payment Date for such series of Bonds, in which case the effective
date of registration shall be the Issue Date of such series of Bonds; provided,
however, that if payment of the interest on any Bonds of any series shall be in
default at the time of authentication of any Bond 

 4
 

certificates issued in lieu of Bonds surrendered for transfer or
exchange, the effective date of registration shall be as of the date to which
interest has been paid in full on the Bonds surrendered.

Section 204.  Method and
Place of Payment of Bonds. 
Payment of interest on each Bond shall be made by the Trustee on each
Payment Date to the person appearing on the registration books of the Issuer
maintained by the Trustee as the registered owner thereof by check or draft
mailed to such Bondowner at the address appearing on such registration books.  At the written request of any Owner of at
least $100,000 in principal amount of the Bonds, interest shall be paid to such
Owner by electronic transfer to the address specified by such Owner in writing
to the Trustee at least 15 days prior to the Record Date preceding the
applicable Interest Payment Date.  Any
such written request for electronic transfer shall be signed by such Owner and
shall include the name of the bank (which shall be in the continental United States),
its address, its ABA routing number, and the name, number, and contact name
related to such Owner’s account at such bank to which payment is to be
credited.  Final payment of principal and
redemption premium, if any, on all Bonds shall be made by check or draft upon
the presentation and surrender of the certificate(s) representing such Bonds at
the stated maturity or earlier required redemption thereof at the principal
office of the Paying Agent.

Section 205.  Execution
and Authentication of Bonds.

(a)  Bond certificates shall be executed
on behalf of the Issuer by the manual or facsimile signature of the Mayor and
attested by the manual or facsimile signature of its City Clerk, and shall have
the corporate seal of the Issuer affixed thereto or imprinted thereon.  In case any officer whose signature or
facsimile thereof appears on any Bond certificates shall cease to be such
officer before the delivery of such Bonds, such signature or facsimile thereof
shall nevertheless be valid and sufficient for all purposes, the same as if
such person had remained in office until delivery.  Any Bond certificate may be signed by such
persons as at the actual time of the execution of such Bond certificate shall
be the proper officers to sign although on the date of issuance of such Bond
such persons may not have been such officers.

(b)  The Bonds shall have endorsed
thereon a Certificate of Authentication substantially in the form set forth in Article IV hereof, which shall be manually executed by the
Trustee.  No Bond shall be entitled to
any security or benefit under this Indenture or shall be valid or obligatory
for any purpose unless and until such Certificate of Authentication shall have
been duly executed.  Such executed
Certificate of Authentication upon any Bond certificate shall be conclusive
evidence that the Bonds described in such Bond certificate have been duly
authenticated and delivered under this Indenture.  The Certificate of Authentication on any Bond
certificate shall be deemed to have been duly executed if signed by any
authorized officer or employee of the Trustee, but it shall not be necessary
that the same officer or employee sign the Certificate of Authentication on all
of the Bond certificates that may be delivered hereunder at any one time.

Section 206.  Registration, Transfer and Exchange of Bonds.

(a)  The Trustee shall
keep books for the registration and for the transfer of the Series 2006 Bonds
and any Additional Bonds as provided in this Indenture.

 5
 

(b)  Bonds may be transferred only upon
the books maintained by Trustee for the registration and transfer of Bonds upon
surrender of the certificate(s) representing such Bonds to the Trustee duly
endorsed for transfer or accompanied by an assignment duly executed by the
Bondowner or his attorney or legal representative in such form as shall be
satisfactory to the Trustee.  Upon any
such transfer, the Issuer shall execute and the Trustee shall authenticate and
deliver in exchange for such Bonds new Bond certificate(s), registered in the
name of the transferee, of any denomination or denominations authorized by this
Indenture in an aggregate principal amount equal to the principal amount of
such Bonds, of the same series and maturity and bearing interest at the same
rate.  In the event that any Bondowner
fails to provide a certified taxpayer identification number to the Trustee, the
Trustee may make a charge against such Bondowner sufficient to pay any
governmental charge required to be paid as a result of such failure.

(c)  In all cases in which Bonds shall
be exchanged or transferred hereunder, the Issuer shall execute and the Trustee
shall authenticate and deliver at the earliest practicable time Bond
certificates in accordance with the provisions of this Indenture.  All Bond certificates surrendered in any such
exchange or transfer shall forthwith be canceled by the Trustee. The Issuer or
the Trustee may make a charge for every such exchange or transfer of Bonds
sufficient to reimburse it for any tax, fee or other governmental charge
required to be paid with respect to such exchange or transfer, and such charge
shall be paid by the Bondowner before any such new Bond certificate shall be
delivered.  Neither the Issuer nor the
Trustee shall be required to make any such exchange or transfer of Bonds on or
after the Record Date preceding a Payment Date on the Bonds or, in the case of
any proposed redemption of Bonds, during the 15 days immediately preceding the
selection of Bonds for such redemption or after such Bonds or any portion
thereof has been selected for redemption.

(d)  Any proposed transfer of Series 2006
Bonds shall be made by the Trustee only upon delivery to the Trustee, the
Issuer and the Tenant of an opinion of counsel to the proposed transferor
either (1) that the proposed transfer is a part of a transaction exempt from
the application of the Securities Act of 1933, as amended (the “1933 Act”), or
(2) that the transfer is a part of a transaction that is in compliance with the
registration provisions of the 1933 Act, which opinion shall be in form and
substance acceptable to both the Trustee and the Tenant.

(e)   All of the duties of the Trustee
set forth in this Section 206 may be performed by
any co-trustee or co-paying agent appointed by the Trustee, to the extent
specified in the instrument appointing such co-trustee or co-paying agent.

Section 207.  Persons
Deemed Owners of Bonds.  The
person in whose name any Bond shall be registered as shown on the registration
books required to be maintained by the Trustee by this Article shall be deemed
and regarded as the absolute owner thereof for all purposes.  Payment of, or on account of the principal of
and premium, if any, and, interest on any such Bond shall be made only to or
upon the order of such registered Owner or a duly constituted legal representative.  All such payments shall be valid and
effectual to satisfy and discharge the liability upon such Bond, including the
interest thereon, to the extent of the sum or sums so paid.

 

 6

 

Section 208.  Authorization of Series 2006 Bonds.

(a)  There shall be
initially issued and secured pursuant to this Indenture, a series of Bonds in
the aggregate principal amount of $7,000,000 for the purpose of providing funds
to pay Project Costs, which series of Bonds shall be designated the “City of
Atchison, Kansas, Taxable Industrial Revenue Bonds, Series 2006 (MGP
Ingredients Project).”  The Series 2006
Bonds shall be dated their Issue Date, and shall bear interest on the
Outstanding principal amount thereof at the rate of 4.90% per annum.

(b)  Interest on the Bonds shall be
payable to the Owners thereof in accordance with the provisions of Article II hereof.

(c)  The Trustee is hereby designated as
the Issuer’s Paying Agent for the payment of the principal of, premium, if any,
and interest on the Series 2006 Bonds. 
The Trustee may appoint one or more financial institutions to act as
co-paying agent for the Series 2006 Bonds.

(d)  Upon the original issuance and
delivery of the Series 2006 Bonds, the effective date of registration thereof
shall be their Issue Date.

(e)  The Series 2006 Bonds shall be
substantially in the form and manner set forth in Article IV hereof
and delivered to the Trustee for authentication, but prior to or simultaneously
with the authentication and delivery of the Bonds by the Trustee, there shall
be filed with the Trustee the following:

(1)                  An original or certified copy of the ordinance
enacted by the Issuer’s governing body authorizing the issuance of the Series
2006 Bonds and the execution of this Indenture and the Lease.

(2)                  An original executed counterpart of this
Indenture.

(3)                  An original executed counterpart of the Lease.

(4)                  An opinion of Bond Counsel to the effect that the
Series 2006 Bonds constitute valid and legally binding obligations of the
Issuer, subject to such limitations and restrictions as shall be described
therein.

(5)                  Such other certificates, statements, receipts and
documents as the Trustee shall reasonably require for the delivery of the
Series 2006 Bonds.

(f)  When the documents specified in
subsection (e) of this Section shall have been filed with the Trustee, and when
certificates representing all the Series 2006 Bonds shall have been executed
and authenticated as required by this Indenture, the Trustee shall deliver the
Series 2006 Bonds to or upon the order of the Original Purchaser thereof, but
only upon payment to the Trustee of the purchase price of the Series 2006
Bonds.  The Original Proceeds, including
accrued interest and premium thereon, if any, shall be immediately paid over to
the Trustee, and the Trustee shall deposit and apply such proceeds as provided
in Article V hereof.

 7
 

Section 209.  Authorization
of Additional Bonds.

(a)  Additional Bonds may be issued
under and equally and ratably secured by this Indenture on a parity with the
Series 2006 Bonds and any other Additional Bonds Outstanding at any time and
from time to time, upon compliance with the conditions hereinafter provided in
this Section, for any of the following purposes:

(1)  To provide funds to pay the costs of completing the
Improvements, the total of such costs to be evidenced by a certificate signed
by the Authorized Tenant Representative.

(2)  To provide funds to pay all or any part of the costs of
repairing, replacing or restoring Improvements in the event of damage,
destruction or condemnation thereto or thereof.

(3)  To provide funds to pay all or any part of the costs of
acquisition, purchase or construction of such additions, improvements,
extensions, alterations, expansions or modifications of the Project (including
additional Land or Improvements) or any part thereof as the Tenant may deem
necessary or desirable and as will not impair the nature of the Project as a “facility”
within the meaning and purposes of the Act.

(4)  To provide funds for refunding all or any part of the
Bonds of any series then Outstanding, including the payment of any premium
thereon and interest to accrue to the designated redemption date and any
expenses in connection with such refunding.

(b)  Before any Additional Bonds shall
be issued under the provisions of this Section, the Original Purchaser shall
give its written consent thereto, and the Issuer’s governing body shall enact
an ordinance (i) authorizing the issuance of such Additional Bonds, fixing the
amount and terms thereof and describing the purpose or purposes for which such
Additional Bonds are being issued or describing the Bonds to be refunded, (ii)
authorizing the Issuer to enter into a Supplemental Indenture for the purpose
of providing for the issuance of and securing such Additional Bonds and, if
required, (iii) authorizing the Issuer to enter into a supplemental lease with
the Tenant to provide for rental payments at least sufficient to pay the
principal of, premium, if any, and interest on the Bonds then to be Outstanding
(including the Additional Bonds to be issued) as the same become due, for the
acquisition, purchase, construction or installation of additional Improvements,
for the inclusion of any such addition, expansion or modification as a part of
the Project, and for such other matters as are appropriate because of the
issuance of the Additional Bonds proposed to be issued which, in the judgment
of the Issuer, is not to the prejudice of the Issuer or the owners of the Bonds
previously issued.

(c)  Such Additional Bonds shall have
the same designation as the Series 2006 Bonds, except for an identifying series
letter or date and the addition of the word “Refunding” when applicable, shall
be dated, shall be stated to mature on Principal Payment Dates in such year or
years, shall bear interest at such rate or rates not exceeding the maximum rate
then permitted by law, and shall be redeemable at such times and prices
(subject to the provisions of Article III of
this Indenture), all as may be provided by the Supplemental Indenture
authorizing the issuance of such 

 8
 

Additional Bonds.  Except as to
any difference in the date, the maturity or maturities, the rate or rates of
interest or the provisions for redemption, such Additional Bonds shall be on a
parity with and shall be entitled to the same benefit and security of this
Indenture as the Series 2006 Bonds and any other Additional Bonds Outstanding
at the time of the issuance of such Additional Bonds.

(d)  Such Additional Bonds shall be
substantially in the form and executed in the manner set forth in this Article
and Article IV hereof and certificates
representing such Bonds shall be deposited with the Trustee for authentication,
but prior to or simultaneously with the authentication and delivery of such
Bond certificates by the Trustee, there shall be filed with the Trustee the
following:

(1)  An original or certified copy of the ordinance enacted by
the Issuer’s governing body authorizing the issuance of such Additional Bonds
and the execution of such Supplemental Indenture and the appropriate amendments
or supplements to the Lease.

(2)  An original executed counterpart of the Supplemental
Indenture providing for the issuance of the Additional Bonds.

(3)  An original executed counterpart of the amendment or
supplement to the Lease, if required.

(4)  In the case of Additional Bonds being issued to refund
Outstanding Bonds, such additional documents as shall be reasonably required by
the Trustee to establish that provision has been duly made for the payment of
all of the Bonds to be refunded in accordance with the provisions of Article
XIII of this Indenture.

(5)  A copy of the written consent of the Original Purchaser.

(6)  Such other instructions, certificates, statements,
receipts and documents as the Trustee shall reasonably require for the delivery
of such Additional Bonds.

(e)  When the documents mentioned in
subsection (d) of this Section shall have been filed with the Trustee, and when
such Additional Bonds shall have been executed and authenticated as required by
this Indenture, the Trustee shall deliver such Additional Bonds to or upon the
order of the purchasers thereof, but only upon payment to the Trustee of the
purchase price of such Additional Bonds. 
The proceeds of the sale of such Additional Bonds, (except Additional
Bonds issued to refund Outstanding Bonds), including accrued interest and
premium thereon, if any, shall be immediately paid over to the Trustee and
shall be deposited and applied by the Trustee as provided in Article V hereof and in the Supplemental Indenture
authorizing the issuance of such Additional Bonds.  The proceeds, (excluding accrued interest and
premium, if any, which shall be deposited in the Debt Service Fund) of all Additional
Bonds issued to refund Outstanding Bonds shall be deposited by the Trustee,
after payment or making provision for payment of all expenses incident to such
financing, to the credit of a special trust fund, appropriately designated, to
be held in trust for the sole and exclusive purpose of paying the principal of,
premium, if any, and interest on the Bonds to be refunded, as provided in Section 1302 hereof and in the Supplemental Indenture
authorizing the issuance of such refunding Bonds.

 9
 

(f)  Except as provided in this Section,
the Issuer will not otherwise issue any obligations ratably secured and on a
parity with the Bonds, but the Issuer may issue other obligations specifically
subordinate and junior to the Bonds with the express written consent of the
Tenant.

Section 210.  Temporary
Bonds.

(a)  Until definitive Bonds of any
series are available for delivery, the Issuer may execute, and upon request of
the Issuer, the Trustee shall authenticate and deliver, in lieu of definitive
Bonds, but subject to the same limitations and conditions as definitive Bonds,
temporary printed, engraved, lithographed or typewritten Bonds, in the form of
fully registered Bonds in denominations of $5,000 or any integral multiple
thereof, substantially of the tenor hereinabove set forth and with such
appropriate omissions, insertions and variations as may be required with
respect to such temporary Bonds.

(b)  If temporary Bonds shall be issued,
the Issuer shall cause the definitive Bonds to be prepared and to be executed
and delivered to the Trustee, and the Trustee, upon presentation to it at its
principal office of any temporary Bond shall cancel the same and authenticate
and deliver in exchange therefor, without charge to the Owner thereof, a
definitive Bond or Bonds of an equal aggregate principal amount, of the same
series and maturity and bearing interest at the same rate as the temporary Bond
surrendered.  Until so exchanged the
temporary Bonds shall in all respects be entitled to the same benefit and security
of this Indenture as the definitive Bonds to be issued and authenticated
hereunder.

Section 211.  Mutilated,
Lost, Stolen or Destroyed Bonds. In the event any Bond certificate
shall become mutilated, or be lost, stolen or destroyed, the Issuer shall
execute and the Trustee shall authenticate and deliver a new Bond certificate
of like series, date and tenor as the Bond certificate mutilated, lost, stolen
or destroyed. In the case of any mutilated Bond certificate, such mutilated
Bond shall first be surrendered to the Trustee; and in the case of any lost,
stolen or destroyed Bond certificate, there shall be first furnished to the
Issuer and the Trustee evidence of such loss, theft or destruction satisfactory
to the Issuer and the Trustee, together with indemnity satisfactory to them.  In the event any such Bond shall have
matured, instead of issuing a substitute Bond certificate the Issuer may pay or
authorize the payment of the same without surrender thereof.  Upon the issuance of any substitute Bond certificate,
the Issuer and the Trustee may require the payment of an amount sufficient to
reimburse the Issuer and the Trustee for any tax or other governmental charge
that may be imposed in relation thereto and any other reasonable fees and
expenses incurred in connection therewith.

 10
 

Section 212.  Cancellation and Destruction of Bonds Upon Payment.

(a)  All Bonds which
have been paid or redeemed or which the Trustee has purchased or the
certificates of which have otherwise been surrendered to the Trustee under this
Indenture, either at or before maturity, shall be canceled by the Trustee
immediately upon the payment, redemption or purchase of such Bonds and the
surrender of the certificates thereof to the Trustee.

(b)  All Bonds canceled under any of the
provisions of this Indenture shall be delivered by the Trustee to the Issuer,
or, upon request of the Issuer, shall be destroyed by the Trustee.  The Trustee shall execute a certificate in
triplicate describing the Bonds so delivered or destroyed, and shall file
executed counterparts of such certificate with the Issuer and the Tenant.

ARTICLE III

REDEMPTION OF BONDS

Section 301.  Redemption
of Bonds Generally.  The
Series 2006 Bonds shall be subject to redemption prior to maturity in
accordance with the terms and provisions of this Article.  Additional Bonds shall be subject to
redemption prior to maturity in accordance with the terms and provisions
contained in this Article and as may be specified in the Supplemental Indenture
authorizing such Additional Bonds.

Section 302.  Redemption
of Series 2006 Bonds. The Bonds shall be subject to redemption as
follows:

(a)  Extraordinary Optional
Redemption. In the event of a Change of Circumstances, the Series
2006 Bonds shall be subject to redemption and payment prior to the stated
maturity thereof, at the option of the Issuer, upon instructions from the
Tenant, on any date at the par value of the principal amount thereof, plus
accrued interest thereon to the redemption date, without premium, provided all
of the Series 2006 Bonds are so redeemed and paid according to their terms.

(b)  Optional Redemption.  The outstanding principal amount of the
Series 2006 Bonds shall be subject to redemption and payment prior to maturity,
at the option of the Issuer, upon instructions from the Tenant, as a whole or
in part on any date at the redemption price of the par value of the principal
amount thereof, without premium, plus accrued interest thereon to the date
fixed for redemption and payment.

Section 303.  Selection of
Bonds to be Redeemed.

(a)  Bonds shall be redeemed only in the
principal amount of $5,000 or integral multiples thereof.  If less than all of the Outstanding Bonds of
any series are to be redeemed and paid prior to maturity, such Bonds shall be
redeemed as directed in writing by the Tenant. 
Bonds 

 11
 

of less than a full maturity are to be selected by the Trustee in such
equitable manner as it may determine.

(b)  In the case of a partial redemption
of Bonds by lot when Bonds of denominations greater than $5,000 are then
Outstanding, then for all purposes in connection with such redemption each
$5,000 of face value shall be treated as though it was a separate Bond of the
denomination of $5,000.  If it is
determined that one or more, but not all, of the $5,000 units of face value
represented by any fully registered Bond is selected for redemption, then the
Owner of such Bond or his attorney or legal representative shall forthwith
present and surrender such Bond to the Trustee (1) for payment of the
redemption price (including the premium, if any, and interest to the redemption
date) of the $5,000 unit or units of face value called for redemption, and (2)
for exchange, without charge to the Owner thereof, for a new Bond or Bonds of
the aggregate principal amount of the unredeemed portion of the principal
amount of such Bond.  If the owner of any
such Bond of a denomination greater than $5,000 shall fail to present such Bond
to the Trustee for payment and exchange as aforesaid, such Bond shall,
nevertheless, become due and payable on the redemption date to the extent of
the principal amount thereof called for redemption (and to that extent only).

Section 304.  Trustee’s
Duty to Redeem Bonds. The Trustee shall call bonds for mandatory
redemption immediately upon receipt of written advice from the Issuer that the
event giving rise to mandatory redemption has occurred, and stating the
redemption date (except with respect to mandatory redemption of Term Bonds, no
further notice of which is required). 
Upon receipt by the Trustee of such written advice, if required, and
upon its own initiative if not required, the Trustee shall give at least 30
days’ written notice of redemption to the Bondowners as provided herein.  The Trustee shall call Bonds for redemption
and payment as herein provided and shall give notice of redemption as provided
in Section 305 hereof upon receipt by the
Trustee at least 45 days prior to the proposed redemption date (unless waived)
of a written request of the Issuer together with a copy of the redemption
instructions of the Tenant. Such instructions shall specify the principal
amount and the respective maturities of Bonds to be called for redemption, the
applicable redemption price or prices and the provision or provisions of this
Indenture pursuant to which such Bonds are to be called for redemption.  In the event of a mandatory redemption as
provided herein, no request from the Issuer or instructions from the Tenant
shall be necessary.

Section 305.  Notice of
Redemption.  Notice of the
call for any redemption identifying the Bonds or portions thereof to be
redeemed shall be given by the Trustee, in the name of the Issuer, by mailing
by first class mail, postage prepaid, a copy of the redemption notice at least
30 days prior to the date fixed for redemption to the Owner of each Bond to be
redeemed at the address shown on the registration books maintained by the
Trustee; provided, however, that failure to give such notice by mailing as
aforesaid, or any defect therein, shall not affect the validity of any
proceedings for the redemption of the Bonds. 
Any notice of redemption shall state the date of redemption, the place
or places at which such Bonds shall be presented for payment, the series,
maturities and numbers of the Bonds or portions of Bonds to be redeemed (and in
the case of the redemption of a portion of any Bond the principal amount
thereof being redeemed), the redemption price and shall state that interest on
the Bonds described in such notice will cease to accrue from and after the
redemption date.  A copy of each such
notice of redemption shall be provided to any authorized co-paying agent
appointed by the Trustee.

 12
 

Section 306.  Effect of
Call for Redemption.  Prior to
the date fixed for redemption, funds or Government Securities maturing on or
before the date fixed for redemption shall be deposited with the Trustee in
amounts sufficient to provide for payment of the Bonds called for redemption,
accrued interest thereon to the redemption date and the redemption premium, if
any.  Upon the deposit of such funds or
Government Securities, and notice having been given as provided in Section 305 hereof, the Bonds or the portions of the
principal amount of Bonds thus called for redemption shall cease to bear
interest on the specified redemption date, and shall no longer be entitled to
the protection, benefit or security of this Indenture and shall not be deemed
to be Outstanding under the provisions of this Indenture.

ARTICLE IV

FORM OF BONDS

Section 401.  Forms
Generally.  The Series 2006
Bonds, and the Trustee’s certificate of authentication to be endorsed thereon
shall be, respectively, in substantially the form set forth in Appendix A.  Any
Additional Bonds, and the Trustee’s Certificate of Authentication to be
endorsed thereon shall also be in substantially such form, with such necessary
or appropriate variations, omissions and insertions as are permitted or
required by this Indenture or any Supplemental Indenture.  The Bonds may have endorsed thereon such
legends or text as may be necessary or appropriate to conform to any applicable
rules and regulations of any governmental authority or any custom, usage or
requirement of law with respect thereto.

Section 402.  Form of Bond
Counsel’s Approving Opinion.

Bond Counsel’s approving opinion with respect to
the authorization and issuance of the Bonds shall be substantially in form
acceptable to Bond Counsel and the Original Purchaser and, if printed on the
Bond certificates, shall be preceded by the following certificate:

I, the undersigned, City Clerk of the City of
Atchison, Kansas hereby certify that the following is a true and correct copy
of the complete final legal opinion of Gilmore & Bell, P.C., Bond Counsel,
on the within Bond and the series of which said Bond is a part, except that it
omits the date of such opinion, that said legal opinion was manually executed
and was dated and issued as of the date of delivery of and payment for such
Bonds, and is on file with Commerce Bank, N.A., Kansas City, Missouri.

	
  

  	
  (facsimile signature)

  	
   

  
	
   

  	
  City Clerk of the City of

  	
   

  
	
   

  	
  Atchison, Kansas

  	
   

  

 

 13

 

ARTICLE V

CUSTODY AND
APPLICATION OF BOND PROCEEDS

Section 501.  Creation of Project Fund.   There is hereby established
in the custody of the Trustee a special trust fund in the name of the Issuer to
be designated the “City of Atchison, Kansas Project Fund (MGP Ingredients
Project).”  The Project Fund shall
consist of two accounts:  a Project
Account and a Costs of Issuance Account. 
The Trustee may create separate subaccounts in the Project Account for
each series of Bonds issued pursuant to the Indenture.

Section 502.   Deposits
into the Project Fund.   The following funds shall be paid over
to and deposited by the Trustee into the Project Fund, as and when received:

(a)   The proceeds from the sale of the Series
2006 Bonds, excluding such amounts thereof as are required to be paid into the
Debt Service Fund pursuant to Section 602
hereof.

(b)   The earnings accrued on the investment
of moneys in the Project Fund and required to be deposited into the Project
Fund pursuant to Section 702 hereof.

(c)   The proceeds from the sale of any
Additional Bonds (except Additional Bonds issued to refund Outstanding Bonds)
(excluding such amounts thereof required to be paid into the Debt Service Fund
pursuant to Section 602 hereof).

(d)   The Net Proceeds of casualty insurance,
condemnation awards or title insurance required to be deposited into the
Project Fund pursuant to the Lease.

(e)   Any and all payments from any
contractors or other suppliers by way of breach of contract, refunds or
adjustments required to be deposited into the Project Fund pursuant to the
Lease.

(f)   Except as otherwise provided herein or
in the Lease, any other money received by or to be paid to the Trustee from any
other source for the purchase or construction of the Improvements, or payment
of Costs of Issuance, when accompanied by directions by the Tenant that such
moneys are to be deposited into the Project Fund.

(g)   Moneys received for payment of Costs of
Issuance shall be deposited in the Costs of Issuance Account.  The balance shall be deposited in the Project
Account.

Section 503.   Disbursements from the Project Fund.

(a)   The moneys in the
Project Account of the Project Fund shall be disbursed by the Trustee for the
payment of Project Costs (other than Costs of Issuance) in accordance with the
provisions of Article V of the Lease.  Costs of Issuance shall be paid from the
Costs of Issuance Account of the Project Fund upon receipt of a properly
executed requisition therefor.  The
Trustee hereby covenants and agrees to disburse such moneys in accordance with
such provisions.  If the 

 14
 

Issuer so requests, a copy of
each requisition certificate submitted to the Trustee for payment under this
Section shall be promptly provided by the Trustee to the Issuer.

(b)   The Trustee shall keep and maintain
adequate records pertaining to the Project Fund and all disbursements
therefrom, and after the Improvements have been completed and a certificate of
payment of all costs filed as provided in Section 504
hereof, the Trustee shall file a statement of receipts and disbursements with
respect thereto with the Issuer and the Tenant.

Section 504.   Disposition
Upon Completion of the Improvements.   The completion of the
Improvements and payment of all costs and expenses incident thereto shall be
evidenced by the filing with the Trustee by the Tenant of the Certificate of
Completion required by Section 5.6 of
the Lease.  As soon thereafter as
practicable, any balance remaining in the Project Account of the Project Fund
shall without further authorization be deposited in the Debt Service Fund and
applied by the Trustee solely to the payment of principal of the Bonds through
the payment or redemption thereof on any redemption date specified in Section 302(c) hereof or as otherwise permissible in the
opinion of Bond Counsel.  Any amounts
remaining in the Costs of Issuance Account 30 days prior to the first Interest
Payment Date shall be transferred to the Debt Service Fund as Basic Rent
Credits.

Section 505.   Disposition
Upon Acceleration.   If the principal of the Bonds shall have
become due and payable pursuant to Section 901 of
this Indenture, upon the date of payment by the Trustee of any moneys due as
hereinafter provided in Article IX, any
balance remaining in the Project Fund shall, without further authorization, be
deposited in the Debt Service Fund by the Trustee.

ARTICLE VI

REVENUES AND FUNDS

Section 601.   Creation of
the Debt Service Fund.   There is hereby directed to be
established in the custody of the Trustee a special trust fund in the name of
the Issuer to be designated the “City of Atchison, Kansas Debt Service Fund for
Taxable Industrial Revenue Bonds (MGP Ingredients Project)” (herein called the “Debt
Service Fund”).  The Trustee may create
separate subaccounts in the Debt Service Fund for each series of Bonds issued
pursuant to this Indenture.

Section 602.   Deposits into the Debt Service Fund.   The Trustee shall
deposit into the Debt Service Fund, as and when received, the following:

(a)   All accrued interest on
the Series 2006 Bonds and premium, if any, paid by the Original Purchaser of
the Bonds to be applied to payment of interest on the Series 2006 Bonds
accruing prior to the Completion Date.

(b)   If required by a Supplemental Indenture
authorizing the issuance of Additional Bonds, an additional amount from the
proceeds of such Additional Bonds, such additional amount 

 15
 

not to exceed the sum which, when added to the accrued interest and
premium, if any, received from the sale of such Additional Bonds, will be
sufficient to pay the interest accruing on such Additional Bonds during the
estimated period of construction of the Project Additions financed through the
issuance of such Additional Bonds.

(c)   All Basic Rent payable by the Tenant to
the Issuer specified in Section 3.1 of
the Lease.

(d)   Any amount in the Project Fund to be
transferred to the Debt Service Fund pursuant to Section 504
hereof upon completion of the Improvements and any amount remaining in the
Project Fund to be transferred to the Debt Service Fund pursuant to Section 509 hereof upon acceleration of the maturity of the
Bonds.

(e)   All interest and other income derived
from investments of Debt Service Fund moneys as provided in Section 702 hereof.

(f)   All other moneys received by the Trustee
under and pursuant to any of the provisions of the Lease, except Additional
Rent, or when accompanied by directions from the person depositing such moneys
that such moneys are to be paid into the Debt Service Fund.

Section 603.   Application
of Moneys in the Debt Service Fund.

(a)   Except as provided in subsection (d) of
this Section, moneys in the Debt Service Fund shall be expended solely for the
payment of the principal of, premium, if any, and interest on the Outstanding
Bonds as the same mature and become due or upon the redemption thereof prior to
maturity.

(b)   The Issuer hereby authorizes and directs
the Trustee to withdraw sufficient funds from the Debt Service Fund to pay the
principal of, premium, if any, and interest on the Bonds as the same become due
and payable and to make said funds so withdrawn available to the Paying Agent
for the purpose of paying said principal, premium, if any, and interest.

(c)    The Trustee, upon written
direction of the Issuer and the Tenant, shall use any excess moneys in the Debt
Service Fund (other than investment earnings credited to such account) and any
moneys paid to the Trustee for deposit in the Debt Service Fund pursuant to Section 17.2 of the Lease to redeem Outstanding Bonds,
interest accruing thereon prior to such redemption, and redemption premium, if
any, in accordance with and to the extent permitted by Article III hereof
so long as the Tenant is not in Default with respect to payments of Basic Rent
under the Lease and to the extent said moneys are in excess of amounts required
for payment of Bonds theretofore matured or called for redemption and past due
interest in all cases when such Bonds have not been presented for payment.  The Tenant may also direct such excess moneys
in the Debt Service Fund or such part thereof or other moneys of the Tenant, as
the Tenant may direct, to be applied by the Trustee for the purchase of Bonds
in the open market for the purpose of cancellation.

 16
 

(d)   Any amount remaining in the Debt Service
Fund after the principal of, premium, if any, and interest on the Bonds shall
have been paid in full or provision made therefor in accordance with Article XIII hereof, shall be paid to the Tenant by the
Trustee.

Section 604.   Payments Due
on Saturdays, Sundays and Holidays.   In any case where the date
of maturity of principal of, premium, if any, or interest on the Bonds or the
date fixed for redemption of any Bonds shall not be a Business Day, then
payment of principal, premium, if any, or interest need not be made on such
date but may be made on the next succeeding Business Day with the same force
and effect as if made on the date of maturity or the date fixed for redemption,
and no interest shall accrue for the period after such date.

Section 605.   Nonpresentment
of Bonds.   In the event that any Bond shall not be presented
for payment when the principal thereof becomes due, either at its stated
maturity or at the date called for redemption, or the Trustee is unable to
locate the Owner for the payment of accrued interest or an accrued interest
check remains uncashed, if funds sufficient to pay such Bond and accrued
interest shall have been made available to the Trustee, all liability of the
Issuer to the Bondowner for the payment of such Bond and accrued interest shall
cease and be completely discharged, and the Trustee shall hold such funds,
without interest, for the benefit of such Bondowner, who shall thereafter be
restricted exclusively to such funds for any claim on, or with respect to, such
Bond and interest.  If any Bond shall not
be presented for payment within four years following the date when it becomes
due, whether by maturity or otherwise, or the accrued interest cannot be paid
as set out above, the Trustee shall repay to the Tenant the funds theretofore
held by it for payment of such Bond and interest, and such Bond and interest
shall thereafter be an unsecured obligation of the Tenant, subject to the
defense of any applicable statute of limitation, and the Owner thereof shall be
entitled to look only to the Tenant for payment, and then only to the extent of
the amount so repaid, and the Tenant shall not be liable for any additional
interest thereon.

ARTICLE VII

SECURITY FOR DEPOSITS AND
INVESTMENT OF FUNDS

Section 701.   Moneys to be
Held in Trust.   All moneys deposited with or paid to the
Trustee for the account of any fund or account under any provision of this
Indenture, and all moneys deposited with or paid to the Paying Agent under any
provision of this Indenture, shall be held by the Trustee or Paying Agent in
trust and shall be applied only in accordance with the provisions of this
Indenture and the Lease and, until used or applied as so provided, shall
constitute part of the Trust Estate and be subject to the lien hereof.  Neither the Trustee nor any Paying Agent
shall be under any liability for interest on any moneys received hereunder
except interest earned on investments made pursuant to Section 702
of this Indenture and such other interest as may be agreed upon.

Section 702.   Investment
of Moneys in Funds.   Moneys held in the Project Fund and the
Debt Service Fund shall be separately invested and reinvested by the Trustee at
the written direction of the Tenant (or in the absence of such written
direction, at the discretion of the Trustee) 

 17
 

in Investment Securities which mature or are subject to redemption by
the owner prior to the date such funds will be needed; provided, however, that
such moneys shall not be invested in such manner as will violate the provisions
of Sections 703 hereof.  Any such Investment Securities shall be held
by or under the control of the Trustee and shall be deemed at all times a part
of the fund or account in which such moneys are originally held, and except as
otherwise specifically provided in this Indenture, the interest accruing
thereon and any profit realized from such Investment Securities shall be
credited to and accumulated in such fund or account, and any loss resulting
from such Investment Securities shall be charged to such fund or account.  The Trustee shall sell and reduce to cash a
sufficient amount of such Investment Securities whenever the cash balance in
any fund or account is insufficient for the purposes of such fund or
account.  In determining the balance in
any fund or account, investments in such fund or account shall be valued at the
lower of their original cost or their fair market value as of the most recent
Payment Date.  The Trustee may make any
and all investments permitted by the provisions of this Section through its own
bond department or short-term investment department.  The Trustee shall have no liability for any
loss experienced on any investment made pursuant to this Section.

Section 703.   Record
Keeping.   The Trustee shall maintain records demonstrating
compliance with the provisions of this Article and with the provisions of Article VI for at least six years after the payment of all
of the Outstanding Bonds.

ARTICLE VIII

GENERAL COVENANTS AND PROVISIONS

Section 801.   Payment of
Principal of, Premium, if any, and Interest on the Bonds.   The
Issuer covenants and agrees that it will, but solely from the rents, revenues
and receipts derived from the Project (as well as moneys held for such purposes
hereunder) as described herein, promptly pay or cause to be paid the principal
of, premium, if any, and interest on the Bonds as the same become due and
payable at the place, on the dates and in the manner provided herein and in the
Bonds according to the true intent and meaning thereof, and to this end the
Issuer covenants and agrees that it will use its best efforts to cause the
Project and any Improvements to be continuously leased as a revenue and income
producing undertaking, and that, should there be a default under the Lease with
the result that the right of possession of the Project and any Improvements is
returned to the Issuer, the Issuer shall fully cooperate with the Trustee and
with the Bondowners to protect the rights and security of the Bondowners and
shall diligently proceed in good faith and use its best efforts to secure
another tenant for the Project and any Improvements to the end that at all
times sufficient rents, revenues and receipts will be derived by Issuer from
the Project to provide for payment of the principal of, premium, if any, and
interest on the Bonds as the same become due and payable.  If the Issuer is unable to procure a new
tenant who will enter into such a lease, the Issuer may take such good faith
action as shall be in the best interests of the Bondowners which may include
the sale of the Project and any Improvements, and if the Project is sold, after
deducting all costs of the sale, any moneys derived from such sale shall be
used for the purpose of paying the principal of and interest and redemption
premium, if any, on the Bonds. Nothing herein shall be construed as requiring
the Issuer to operate the Project as a business other 

 18
 

than as lessor or to use any funds or revenues from any source other
than funds and revenues derived from the Project.

Section 802.   Authority to
Execute Indenture and Issue Bonds.   The Issuer covenants that
it is duly authorized under the constitution and laws of the State to execute
this Indenture, to issue the Bonds and to pledge and assign the Trust Estate in
the manner and to the extent herein set forth (including the creation of a
security interest therein); that all action on its part for the execution and
delivery of this Indenture and the issuance of the Bonds has been duly and
effectively taken; and that the Bonds in the hands of the Owners thereof are
and will be valid and enforceable limited obligations of the Issuer according
to the import thereof.

Section 803.   Performance
of Covenants.   The Issuer covenants that it will faithfully
perform at all times any and all covenants, undertakings, stipulations and
provisions contained in this Indenture, in the Bonds and in all proceedings of
its governing body pertaining thereto.

Section 804.   Instruments
of Further Assurance.   The Issuer covenants that it will do,
execute, acknowledge and deliver, or cause to be done, executed, acknowledged
and delivered, such Supplemental Indentures and such further acts, instruments,
financing statements and other documents as the Trustee may reasonably require
for the better pledging and assigning unto the Trustee the property and
revenues herein described to secure the payment of the principal of, premium,
if any, and interest on the Bonds.  The
Issuer hereby acknowledges that this Indenture constitutes a security agreement
with respect to the Trust Estate, and authorizes the Trustee to file financing
statements to perfect its security interest in the Trust Estate, or any part
thereof.  The Issuer covenants and agrees
that, except as herein and in the Lease provided, it will not sell, convey,
mortgage, encumber or otherwise dispose of any part of the Project or the
rents, revenues and receipts derived therefrom or from the Lease, or of its
rights under the Lease.

Section 805.   Maintenance,
Taxes and Insurance.   The Issuer represents that pursuant to
the provisions of Articles VI, VII and X of the Lease, the Tenant has agreed to cause the Project
to be maintained and kept in good condition, repair and working order, to pay,
as the same respectively become due, all taxes, assessments and other
governmental charges at any time lawfully levied or assessed upon or against
the Project or any part thereof, and to keep the Project constantly insured to
the extent provided for therein, all at the sole expense of Tenant.

Section 806.   Inspection
of Project Books.   The Issuer covenants and agrees that all
books and documents in its possession relating to the Project and the rents,
revenues and receipts derived from the Project shall at all times be open to
inspection by such accountants or other agencies as the Trustee may from time
to time designate.

Section 807.   Enforcement
of Rights Under the Lease.   The Issuer covenants and agrees
that it shall enforce all of its rights and all of the obligations of the
Tenant (at the expense of the Tenant) under the Lease to the extent necessary
to preserve the Project in good order and repair, and to protect the rights of
the Trustee and the Bondowners hereunder with respect to the pledge and
assignment of the rents, revenues and receipts coming due under the Lease.  The Trustee as assignee of the Lease in its
name or in the name of the Issuer shall enforce all rights of the Issuer 

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and all obligations of the Tenant under and pursuant to the Lease for
and on behalf of the Bondowners, whether or not the Issuer is in default
hereunder.

Section 808.   Possession
and Use of Project.   So long as not otherwise provided in this
Indenture, the Tenant shall be suffered and permitted to possess, use and enjoy
the Project and appurtenances so as to carry out its obligations under the
Lease.

ARTICLE IX

REMEDIES ON DEFAULT

Section 901.   Acceleration
of Maturity in Event of Default.

(a)   If an Event of Default shall have
occurred and be continuing, the Trustee may, and upon the written request of
Bondowners owning not less than 25% in aggregate principal amount of Bonds then
Outstanding shall, by notice in writing delivered to the Issuer and the Tenant,
declare the principal of all Bonds then Outstanding and the interest accrued
thereon immediately due and payable, and such principal and interest shall
thereupon become and be immediately due and payable.

(b)   If, at any time after such declaration,
but before the Bonds shall have matured by their terms, all overdue
installments of principal and interest on the Bonds, together with all Default
Administration Costs, all overdue installments of Basic Rent and Additional
Rent under the Lease and all other sums then payable by the Issuer under this
Indenture shall either be paid or provision satisfactory to the Trustee shall
be made for such payment, then and in every such case the Trustee may in its
discretion, and shall upon the written consent of Bondowners owning at least
51% in aggregate principal amount of the Bonds Outstanding, rescind such
declaration and annul such default in its entirety.

(c)   In case of any rescission, then and in
every such case the Issuer, the Trustee and the Bondowners shall be restored to
their former position and rights hereunder respectively, but no such rescission
shall extend to any subsequent or other default or Event of Default or impair
any right consequent thereon.

Section 902.   Exercise of
Remedies by the Trustee.

(a)   If an Event of Default shall have
occurred and be continuing, the Trustee may, and if requested to do so in
writing by Bondowners owning not less than 25% of the aggregate principal
amount of Bonds Outstanding, and if indemnified to its satisfaction and
satisfactory provision has been offered as to payment of Default Administration
Costs and third-party liability, shall pursue and exercise any available remedy
at law or in equity by suit, action, mandamus or other proceeding or exercise
such one or more of the rights and powers conferred by this Article as the
Trustee, being advised by counsel, shall deem most expedient in the interests
of the Bondowners to enforce the payment of the principal of, premium, if any,
and interest on the Bonds 

 20
 

then Outstanding, and to enforce and compel the performance of the
duties and obligations of the Issuer as herein set forth.

(b)   All rights of action under this Indenture
or under any of the Bonds may be enforced by the Trustee without the possession
of any of the Bonds or the production thereof in any trial or other proceedings
relating thereto, and any such suit or proceeding instituted by the Trustee
shall be brought in its name as Trustee without necessity of joining as
plaintiffs or defendants any Bondowners, and any recovery of judgment shall be
for the equal benefit of all Outstanding Bonds.

(c)   In any litigation with the Tenant after
an Event of Default, the Trustee may, after obtaining the written approval of
Bondowners owning at least 51% of the aggregate principal amount of Bonds
Outstanding, enter into an agreement to settle the litigation upon such terms
as the Trustee in its sole discretion determines to be in the best interest of
the Bondowners, even if such settlement involves selling the Project and
Improvements for less than the amount needed to pay the Owners of the Bonds
Outstanding the full amounts of the principal and accrued interest on the
Bonds.

Section 903.   Limitation
on Exercise of Remedies by Bondowners.   No Bondowner shall have
any right to institute any suit, action or proceeding in equity or at law for
the enforcement of this Indenture or for the execution of any trust hereunder
or for the appointment of a receiver or any other remedy hereunder, unless (i)
a default has occurred of which the Trustee has knowledge, (ii) such default
shall have become an Event of Default, (iii) Bondowners owning at least 25% in
aggregate principal amount of Bonds then Outstanding shall have made written
request to the Trustee, shall have offered it reasonable opportunity either to
proceed to exercise the powers hereinbefore granted or to institute such
action, suit or proceeding in its own name, and (iv) satisfactory indemnity and
provision for payment of Default Administration Costs and third-party liability
shall have been offered to the Trustee and (v) the Trustee shall thereafter
fail or refuse to exercise the powers granted in this section to institute such
action, suit or proceeding in its own name; and such knowledge and request are
hereby declared in every case, at the option of the Trustee, to be conditions
precedent to the execution of the powers and trusts of this Indenture, and to
any action or cause of action for the enforcement of this Indenture, or for the
appointment of a receiver or for any other remedy hereunder, it being
understood and intended that no one or more Bondowners shall have any right in
any manner whatsoever to affect, disturb or prejudice this Indenture by its,
his or their action or to enforce any right hereunder except in the manner
herein provided, and that all proceedings at law or in equity shall be
instituted, had and maintained in the manner herein provided and for the equal
benefit of all Bonds then Outstanding.

Section 904.   Right of
Bondowners to Direct Proceedings.   Anything in this Indenture
to the contrary notwithstanding, Bondowners owning at least 51% in aggregate
principal amount of Bonds then Outstanding shall have the right, at any time,
by an instrument or instruments in writing executed and delivered to the
Trustee, and upon providing the Trustee indemnification satisfactory to it as
provided above, to direct the time, method and place of conducting all
proceedings to be taken in connection with the enforcement of the terms and
conditions of this Indenture, or for the appointment of a receiver or any other
proceedings hereunder; provided that such direction shall not be otherwise than
in accordance with the provisions of law and of this 

 21
 

Indenture, and Trustee shall have the right to decline to follow such
direction if the Trustee shall in good faith, and upon the advice of counsel,
determine that proceedings so directed would expose the Trustee to personal
liability.

Section 905.   Remedies
Cumulative.   No remedy by the terms of this Indenture conferred
upon or reserved to the Trustee or to the Bondowners is intended to be
exclusive of any other remedy, but each and every such remedy shall be
cumulative and shall be in addition to any other remedy given to the Trustee or
to the Bondowners hereunder or now or hereafter existing at law or in equity or
by statute.  No delay or omission to
exercise any right, power or remedy accruing upon any Event of Default shall
impair any such right, power or remedy or shall be construed to be a waiver of
any such Event of Default or acquiescence therein; and every such right, power
or remedy may be exercised from time to time and as often as may be deemed
expedient.  No waiver of any Event of
Default hereunder, whether by the Trustee or by the Bondowners, shall extend to
or shall affect any subsequent Event of Default or shall impair any rights or
remedies consequent thereon.

Section 906.   Waivers of
Events of Default.   The Trustee may in its discretion waive any
Event of Default hereunder and its consequences and rescind any declaration of
maturity of principal of and interest on Bonds, and shall do so upon the
written request of Bondowners owning at least 51% in aggregate principal amount
of all the Bonds then Outstanding and satisfaction of the conditions set forth
in Section 901(b).  In case of any such waiver or rescission, or
in case any proceedings taken by the Trustee under this Indenture on account of
any such default shall have been discontinued or abandoned for any reason, or
shall have been determined adversely, then and in every such case the Issuer,
the Trustee and the Bondowners shall be restored to their former positions,
rights and obligations hereunder, respectively, but no such waiver or
rescission shall extend to any subsequent or other default, or impair any right
consequent thereon, and all rights, remedies and powers of the Trustee shall
continue as if no such proceedings had been taken.

Section
907.   Application
of Money Received after Event of Default.   If the principal of all Bonds shall have become
due and payable after the occurrence of an Event of Default, all moneys
thereafter received from the Tenant, from sale or reletting of the Project:

first:   to
the payment of all installments of interest due and payable on or prior to
maturity, if any, in the order in which such installments became due and
payable and, if the amount available is not sufficient to pay in full any
particular installment, then to the payment, ratably, according to the amounts
due on such installment, without any discrimination or preference except as to
any difference in the respective rates of interest specified in the Bonds, and
then to the payment of any interest due and payable after maturity on the Bonds,
ratably, without any discrimination or preference except as to any difference
in the respective rates of interest specified in the Bonds; and

second:   to
the payment of the principal of the Bonds, ratably, without preference or
priority of any obligation over any other obligation.

Whenever moneys are to be applied
by the Issuer or the Trustee pursuant to the provisions of this Section, such
moneys shall be applied at such times, and from time to time, as the Trustee in

 22
 

its sole discretion determines, having due regard
to the amount of such moneys available for application and the likelihood of
additional moneys becoming available for such application in the future; the
deposit of such moneys with the Trustee in trust for the proper purpose shall
constitute proper application by the Issuer; and the Issuer shall incur no
liability to any Bondowner or to any other person for any delay in applying any
such moneys, so long as the Issuer acts with reasonable diligence, having due
regard to the circumstances, and moneys are applied in accordance with such
provisions of this Indenture.  Whenever
the Trustee exercises such discretion in applying such moneys, it shall fix the
date (which shall be an Interest Payment Date unless the Trustee shall deem
another date more suitable) upon which such application is to be made and upon
such date interest on the amounts of principal to be paid on such date shall
cease to accrue.  The Trustee shall give
such notice as it may deem appropriate of the fixing of any such date, and
shall not be required to make payment to any Bondowner of any unpaid Bond until
the Bond certificate(s) representing Bonds owned are surrendered to the Trustee
as Bond Registrar for appropriate endorsement, or for cancellation if fully
paid.

ARTICLE X

THE TRUSTEE

Section 1001.   Acceptance
of the Trusts.   The Trustee hereby accepts the trusts imposed
upon it by this Indenture, and agrees to perform said trusts in the manner in
which a corporate trustee ordinarily would perform said trusts under a
corporate indenture, and the Trustee shall exercise such of the rights and
powers vested in it by this Indenture and shall use the same degree of care and
skill in its exercise as a prudent corporate trust officer would exercise or
use under the circumstances, but only upon and subject to the following express
terms and conditions, and no implied covenants or obligations shall be read
into this Indenture against the Trustee:

(a)   Prior to the occurrence of an Event of
Default and after the cure of all Events of Default which may have occurred,
the Trustee’s duties and responsibilities shall include only those expressly
set forth in this Trust Indenture and those rights, duties, responsibilities,
and obligations which are reserved to or imposed upon the Issuer under this
Trust Indenture and the Lease, excepting only such of those rights, duties,
responsibilities, and obligations as may only be properly and lawfully
exercised by or imposed upon the Issuer.

(b)   Upon the occurrence of an Event of
Default the Trustee shall be and is hereby authorized to bring appropriate
action for judgment or such other relief as may be appropriate and such action
may be in the name of the Trustee or in the name of the Issuer and Trustee
jointly; but in such case, neither the Issuer nor the Trustee shall have any
obligation for any fees and expenses of such action except out of any funds
available by reason of the ownership of the Project and moneys available under
this Trust Indenture and the Lease.  In
addition, the Trustee may file such proof of claim and such other documents as
may be necessary and advisable in order to have the claims of the Trustee and
the Bondowners relative to the Bonds or the obligations relating thereto
allowed in any judicial proceeding.

 

 23

 

(c)  The Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly or
through agents, attorneys or receivers. The Trustee shall be entitled to rely
upon the opinion or advice of counsel, who may be counsel to the Trustee,
Issuer or the Tenant, concerning all matters of trust hereof and the duties
hereunder, and may in all cases pay such reasonable compensation to all such
agents, attorneys and receivers as may reasonably be employed in connection
with the trusts hereof.

(d)  The Trustee, in its individual or
any other capacity, may become the owner or pledgee of Bonds with the same
rights which it would have if it were not Trustee.

(e)  The Trustee may rely and shall be
protected in acting or refraining from acting upon any ordinance, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, affidavit, letter, telegram or other paper or document provided for
under this Indenture or the Lease believed by it to be genuine and correct and
to have been signed, presented or sent by the proper person or persons.  Any action taken by the Trustee pursuant to
this Indenture upon the request or authority or consent of any person who, at
the time of making such request or giving such authority or consent is a
Bondowner, shall be conclusive and binding upon all future Owners of the same
Bond and upon Bonds issued in exchange therefor or upon transfer or in
substitution thereof.

(f)  As to the existence or nonexistence
of any fact or as to the sufficiency or validity of any instrument, paper or
proceeding, or whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee shall be entitled to
rely upon a certificate signed by the mayor of the Issuer or the Authorized
Tenant Representative as sufficient evidence of the facts therein contained,
the Trustee shall also be at liberty to accept a similar certificate to the
effect that any particular dealing, transaction or action is necessary or
expedient, but may at its discretion secure such further evidence deemed
necessary or advisable, but shall in no case be bound to secure the same.

(g)  The permissive right of the Trustee
to do things enumerated in this Indenture shall not be construed as a duty, and
the Trustee shall not be answerable for other than its negligence or willful
misconduct.

(h)  At any and all reasonable times the
Trustee and its duly authorized agents, attorneys, experts, engineers,
accountants and representatives shall have the right to inspect any and all of
the Project and all books, papers and records of the Issuer and Tenant
pertaining to the Project and the Bonds, and to make such notes and copies as
may be desired.

(i)  The Trustee shall not be required
to give any bond or surety with respect to the execution of its trusts and
powers hereunder or otherwise with respect to the Project.

(j)  The Trustee shall have the right,
but shall not be required, to demand, with respect to the authentication of any
Bonds, the withdrawal of any cash, the release of any property, or any action
whatsoever within the purpose of this Indenture, any showings, certificates,
opinions, appraisals or other information, or corporate action or evidence
thereof, in addition to that by the 

 24
 

terms hereof required, as a condition of such action by
the Trustee deemed desirable for the purpose of establishing the right of the
Issuer to the authentication of any Bonds, the withdrawal of any cash, or the
taking of any other action by the Trustee.

(k)  The Trustee shall not be required
to take notice of, or be deemed to have notice of, any default hereunder or
under the Lease, except the failure by the Issuer to cause to be made any of
the payments required to be made under the Lease or in accordance with Article VI hereof, or the failure by the Issuer to cause
compliance by the Tenant with the provisions of Article VI
of the Lease, unless the Trustee shall have been specifically notified in
writing of such default by the Issuer or by Bondowners owning at least 25% in
aggregate principal amount of all Bonds then Outstanding.

(l)  The Trustee may inform the
Bondowners of environmental hazards that the Trustee has reason to believe
exist with respect to the Project, the Project or the Improvements, and the
Trustee shall have the right to take no further action with respect thereto,
and, in such event, no fiduciary duty shall exist which imposes any obligation
for further action by the Trustee with respect to the Project, the Project, the
Improvements, the enforcement of any remedies hereunder or under this Lease,
the Trust Estate, or any portion thereof, if, in the reasonable opinion of the
Trustee, such action would subject the Trustee to environmental or other
liability for which the Trustee has not received indemnity satisfactory to it.

Section 1002.  Fees,
Charges and Expenses of the Trustee; Lien for Fees and Costs and Additional
Rent. The Trustee shall be entitled to payment of or reimbursement
for reasonable fees for its ordinary services rendered hereunder and all
advances, agent and counsel fees and other ordinary costs, charges and expenses
reasonably and necessarily made or incurred by the Trustee in connection with
such ordinary services and, in the event that it should become necessary that
the Trustee perform extraordinary services, it shall be entitled to reasonable
compensation therefor and to reimbursement for reasonable and necessary
extraordinary expenses in connection therewith; provided that if such
extraordinary services or extraordinary expenses are occasioned by the neglect
or misconduct of the Trustee it shall not be entitled to compensation or
reimbursement therefor.  The Trustee
shall be entitled to payment and reimbursement for the reasonable fees, costs,
expenses and charges of the Trustee as Paying Agent for the Bonds.  The Trustee agrees that the Issuer shall have
no liability for any fees, charges and expenses of the Trustee, and the Trustee
agrees to look only to the Tenant for the payment of all fees, charges and
expenses of the Trustee and any Paying Agents as provided in the Lease.  Upon the occurrence of an Event of Default
and during its continuance, the Trustee shall have a lien with right of payment
prior to payment of principal of, redemption premium, if any, or interest on
any Bond, upon all moneys in its possession under any provisions hereof for the
foregoing advances, fees, costs and expenses incurred, for Default
Administration Costs and for any unpaid Additional Rent owing under the Lease.

Section 1003.  Notice to
Bondowners if Default Occurs. 
If an Event of Default occurs, of which the Trustee is aware and of
which it is required to take notice, the Trustee shall give written notice
thereof to the Bondowners, as shown by the bond registration books required to
be maintained by the Trustee and kept at the principal office of the Trustee.

 25
 

Section 1004.  Intervention
by the Trustee.  In any
judicial proceeding to which the Issuer is a party and which, in the opinion of
the Trustee and its counsel, has a substantial bearing on the interests of the
Bondowners, the Trustee may intervene on behalf of the Bondowners and shall do
so if requested in writing by Bondowners owning at least 25% of the aggregate
principal amount of Bonds then Outstanding and if provided with indemnity
satisfactory to the Trustee.

Section 1005.  Successor
Trustee Upon Merger, Consolidation or Sale.  Any corporation or association into which the
Trustee may be merged or converted or with or into which it may be
consolidated, or to which it may sell or transfer its corporate trust business
and assets as a whole or substantially as a whole, or any corporation or
association resulting from any merger, conversion, sale, consolidation or
transfer to which it is a party, shall be and become successor Trustee
hereunder  without the execution or
filing of any instrument or any further act on the part of any of the parties
hereto.

Section 1006.  Resignation
of Trustee.  The Trustee may resign
by an instrument in writing delivered by registered or certified mail to the
Issuer and the Tenant to take effect not sooner than 90 days after its
delivery, whereupon the Issuer, with the consent of the Tenant, shall
immediately, in writing, designate a successor Trustee; provided, however, that
the Trustee’s resignation shall not become effective unless and until a
successor Trustee is approved and qualified. 
In the event the Issuer and the Tenant do not promptly designate a
successor trustee, then the Trustee shall have the right to petition a court of
competent jurisdiction for the appointment of a successor.

Section 1007.  Removal of
Trustee.  As long as no
Default or Event of Default shall have occurred and be continuing, the Trustee
may be removed at any time by the Issuer or the Tenant; provided, that such
removal shall not be effective unless and until a successor trustee is
appointed and qualified, and provided further than such removal shall not
become effective until after 60 days from the date written notice of such
proposed removal is given to the Trustee by first class mail.  The Issuer or the Tenant, concurrently with
giving notice to the Trustee, shall give notice by first class mail of the
proposed removal of the Trustee to all Bondowners.  Unless Bondowners owning at least 51% in
principal amount of Bonds then Outstanding object in writing to the proposed
removal of the Trustee, such removal shall become effective from the date
specified in the notices, provided that the successor trustee shall have been
qualified and have accepted the duties and responsibilities of the Trustee as
of such date. The Trustee may be removed at any time by the written direction
of Bondowners owning at least 51% in aggregate principal amount of Bonds then Outstanding.

Section 1008.  Qualifications
of Successor Trustee.  Every
successor Trustee appointed pursuant to the provisions of this Article shall be
a trust company or bank in good standing, qualified to accept such trust and
acceptable to the Issuer and the Tenant.

Section 1009.  Vesting of
Trusts in Successor Trustee.  Every successor Trustee appointed hereunder
shall execute, acknowledge and deliver to its predecessor and also to the
Issuer and the Tenant an instrument in writing accepting such appointment
hereunder, and thereupon such successor shall, without any further act, deed or
conveyance, become fully vested with all the trusts, powers, rights,
obligations, duties, remedies, immunities and privileges of its 

 26
 

predecessor; but such predecessor shall, nevertheless, on the written
request of the Issuer, execute and deliver an instrument transferring to such
successor Trustee all the trusts, powers, rights, obligations, duties,
remedies, immunities and privileges of such predecessor hereunder; and every
predecessor Trustee shall deliver all securities and moneys held by it as
Trustee hereunder to its successor. 
Should any instrument in writing from the Issuer be required by any
successor Trustee for more fully and certainly vesting in such successor the
trusts, powers, rights, obligations, duties, remedies, immunities and
privileges hereby vested in the predecessor, any and all such instruments in
writing shall, on request, be executed, acknowledged and delivered by the
Issuer.

Section 1010.  Right of Trustee
to Pay Taxes and Other Charges. 
In case any tax, assessment or governmental or other charge upon, or
insurance premium with respect to, any part of the Project is not paid as
required herein or in the Lease, and the Tenant has failed after 30 days
written notice to make such payment, the Trustee may pay such tax, assessment
or governmental charge or insurance premium, without prejudice, however, to any
rights of the Trustee or the Bondowners hereunder arising in consequence of
such failure; and any amount at any time so paid under this Section, with
interest thereon from the date of payment at a rate per annum equal to the
Trustee’s published prime rate in effect at the time, shall become an
additional obligation secured by this Indenture, and the same shall be given a
preference in payment over any payment of principal of, premium, if any, or
interest on the Bonds, and shall be paid out of the proceeds of rents, revenues
and receipts collected from the Project, if not otherwise caused to be paid; but
the Trustee shall be under no obligation to make any such payment unless it
shall have been requested to do so by Bondowners owning at least 25% of the
aggregate principal amount of Bonds then Outstanding and shall have been
provided adequate funds for the purpose of such payment.

Section 1011.  Trust Estate
May Be Vested in Co-trustee.

(a)  It is the purpose of this Indenture
that there shall be no violation of any law of any jurisdiction (including
particularly the State) denying or restricting the right of banking
corporations or associations to transact business as trustee in such
jurisdiction.  It is recognized that in
case of litigation under this Indenture or the Lease, and in particular in case
of the enforcement of either on default, or in case the Trustee deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the powers, rights or remedies herein granted to the Trustee, or take any
other action which may be desirable or necessary in connection therewith, it
may be necessary or desirable that the Trustee appoint an additional individual
or institution as a co-trustee or separate trustee, and the Trustee is
hereby authorized to appoint such co-trustee or separate trustee.

(b)  In the event that the Trustee appoints
an additional individual or institution as a co-trustee or separate
trustee, each and every remedy, power, right, claim, demand, cause of action,
immunity, title, interest and lien expressed or intended by this Indenture to
be exercised by the Trustee with respect thereto shall be exercisable by such
co-trustee or separate trustee but only to the extent necessary to enable
such co-trustee or separate trustee to exercise such powers, rights and
remedies, and every covenant and obligation necessary to the exercise thereof
by such co-trustee or separate trustee shall run to and be enforceable by
either of them.

 27
 

(c)  Should any deed, conveyance or
instrument in writing from the Issuer be required by the co-trustee or
separate trustee so appointed by the Trustee for more fully and certainly
vesting in and confirming to him or it such properties, rights, powers, trusts,
duties and obligations, then any and all such deeds, conveyances and
instruments in writing shall, on request, be executed, acknowledged and
delivered by the Issuer.

(d)   In case any co-trustee or
separate trustee shall die, become incapable of acting, resign or be removed,
all the properties, rights, powers, trusts, duties and obligations of such co-trustee
or separate trustee, so far as permitted by law, shall vest in and be exercised
by the Trustee until the appointment of a successor to such co-trustee or
separate trustee.

Section 1012.  Annual
Accounting.  The Trustee shall
render an annual accounting to the Tenant, to the Issuer upon request, and to
any Bondowner requesting the same in writing and remitting reasonable charges
for preparing such copies, showing in reasonable detail all financial
transactions relating to the Trust Estate during the accounting period and the
balance in any funds or accounts created by this Indenture as of the beginning
and close of such accounting period.

Section 1013.  Recordings
and Filings.  The Issuer shall
cause the Lease and all amendments to the Lease or appropriate memoranda
thereof and all appropriate financing statements and other security instruments
to be recorded and filed in such manner and in such places as may be required
by law in order to fully preserve and protect the security of the Bondowners
and the rights of the Trustee hereunder. 
The Issuer hereby authorizes the Trustee to make any such filings for
it.  The Trustee shall cause all
appropriate continuation statements of financing statements initially recorded
to be recorded and filed in such manner and in such places as may be required by
law to continue the effectiveness of such financing statements.

Section 1014.  Performance
of Duties under the Lease.  The Trustee hereby accepts and agrees to
perform, in such manner as is consistent with the terms of those instruments
and this Indenture, all duties and obligations assigned to it under the Lease.

ARTICLE XI

SUPPLEMENTAL
INDENTURES

Section 1101.  Supplemental Indentures Not Requiring Consent of Bondowners.  The Issuer and the Trustee may from time to
time, without the consent of any of the Bondowners, enter into such
Supplemental Indenture or Supplemental Indentures as shall not be inconsistent
with the terms and provisions hereof, for any one or more of the following
purposes:

(a)  To cure any ambiguity or formal
defect or omission in this Indenture or to make any other change not
prejudicial to the Bondowners;

(b)  To grant to or confer upon the
Trustee for the benefit of the Bondowners any additional rights, remedies,
powers or authority that may lawfully be granted to or conferred upon the
Bondowners or the Trustee or either of them;

 28
 

(c)  To more precisely identify the
Project or to add additional property thereto;

(d)  To subject to this Indenture
additional revenues, properties or collateral; and

(e)  To issue Additional Bonds as provided
in Section 209 hereof.

Section 1102.  Supplemental Indentures Requiring Consent of Bondowners.

(a)   Exclusive of
Supplemental Indentures described in Section 1101
hereof and subject to the terms and provisions contained in this Section, and
not otherwise, the Bondowners owning not less than 66-2/3% in aggregate
principal amount of the Bonds then Outstanding shall have the right, from time
to time, anything contained in this Indenture to the contrary notwithstanding,
to consent to and approve the execution by the Issuer and the Trustee of such
other Supplemental Indenture or Supplemental Indentures as shall be deemed
necessary and desirable by the Issuer for the purpose of modifying, amending,
adding to or rescinding, in any particular, any of the terms or provisions
contained in this Indenture or in any Supplemental Indenture; provided,
however, that except as provided in subparagraph (b) of this Section 1102, nothing in this Section contained shall permit
or be construed as permitting (1) an extension of the maturity of the principal
of or the accrual of, or dates of payment of, interest on any Bond issued
hereunder, or (2) a reduction in the principal amount of any Bond or the rate
of interest thereon, or (3) a privilege or priority of any Bond or Bonds over
any other Bond or Bonds, or (4) a reduction in the aggregate principal amount
of Bonds the Owners of which are required for consent to any such Supplemental
Indenture.

(b)  Any provision of this Indenture or
the Bonds may be amended with the written consent of the Owners owning 100% in
aggregate principal amount then Outstanding.

Section 1103.  Tenant’s
Consent to Supplemental Indentures. 
Anything herein to the contrary notwithstanding, a Supplemental
Indenture under this Article which affects any rights of the Tenant shall not
become effective unless and until the Tenant shall have consented in writing to
the execution and delivery of such Supplemental Indenture, provided that
receipt by the Trustee of an amendment to the Lease executed by the Tenant in
connection with the issuance of Additional Bonds under Section 209
hereof shall be deemed to constitute consent of the Tenant to the execution of
a Supplemental Indenture pursuant to Section 209
hereof.  In this regard, unless waived,
the Trustee shall cause notice of the proposed execution and delivery of any
such Supplemental Indenture (other than a Supplemental Indenture proposed to be
executed and delivered pursuant to Section 209
hereof) together with a copy of the proposed Supplemental Indenture to be
mailed to the Tenant at least 15 days prior to the proposed date of execution
and delivery of any such Supplemental Indenture.

 

 29

 

ARTICLE XII

LEASE
AMENDMENTS

Section 1201.  Lease Amendments  The
provisions of the Lease may be amended to the extent and upon the terms and
conditions provided therein.

ARTICLE XIII

SATISFACTION
AND DISCHARGE OF INDENTURE

Section 1301.  Satisfaction
and Discharge of the Indenture

(a)  When the principal of, premium, if
any, and interest on all Bonds shall have been paid in accordance with their
terms or provision has been made for such payment, as provided in Section 1302 hereof, and provision shall also have been made
for paying all other sums payable hereunder, including the fees and expenses of
the Trustee and the Paying Agent to the date of retirement of the Bonds, then
the duties of the Trustee under this Indenture shall cease.  Thereupon the Trustee shall discharge and
release this Indenture and shall execute, acknowledge and deliver to the Issuer
such instruments of satisfaction and discharge or release as shall be requisite
to evidence such release and the satisfaction and discharge of this Indenture,
and shall assign and deliver to the Issuer any property at the time subject to
this Indenture which may then be in its possession, except amounts in the Debt
Service Fund required to be paid to the Tenant under Section
603(d) hereof and except funds or securities in which such funds are
invested and held by the Trustee for the payment of the principal of, and
interest accrued on, the Bonds. 
Notwithstanding anything otherwise provided herein, the provisions of
this Indenture relating to compensation and indemnification of the Trustee
shall survive satisfaction and discharge of the Indenture.

(b)  The Issuer is hereby authorized to
accept a certificate by the Trustee that the principal of, premium, if any, and
interest due and payable upon all of the Bonds then Outstanding and all amounts
required to be paid to the United States have been paid or such payment
provided for in accordance with Section 1302
hereof as evidence of satisfaction of this Indenture, and upon receipt thereof
shall deem this Indenture discharged.

Section 1302.  Bonds Deemed
to be Paid

(a)  Bonds shall be deemed to be paid
within the meaning of this Indenture when payment of the principal of and the
applicable premium, if any, on such Bonds, plus interest thereon to the due
date thereof (whether such due date be by reason of maturity or upon redemption
as provided in this Indenture, or otherwise), either (i) shall have been made
or caused to be made in accordance with the terms thereof, or (ii) shall have
been provided for by depositing with the Trustee, in trust and irrevocably set
aside exclusively for such payment (1) moneys sufficient to make such payment
or (2) non-callable Government Securities maturing as to principal and interest
in such amount and at such times as will insure the availability of sufficient 

 30
 

moneys to make such payment.  At
such time as a Bond shall be deemed to be paid hereunder, as aforesaid, it
shall no longer be secured by or entitled to the benefits of this Indenture,
except for the purposes of any such payment from such moneys or Government
Securities.

(b)  Notwithstanding the foregoing, in
the case of the redemption of Bonds which by their terms may be redeemed prior
to the stated maturities thereof, no deposit under clause (ii) of the
immediately preceding paragraph shall be deemed a payment of such Bonds as
aforesaid until proper notice of such redemption shall have been given in
accordance with Article III of this Indenture or
irrevocable instructions shall have been given to the Trustee to give such
notice.

(c)  Notwithstanding any provision of
any other Section of this Indenture which may be contrary to the provisions of
this Section, all moneys or Government Securities set aside and held in trust
pursuant to the provisions of this Section for the payment of Bonds
(including premium thereon, if any) and interest thereon shall be applied
to and used solely for the payment of the particular Bonds (including premium
thereon, if any) and interest thereon with respect to which such moneys and
Government Securities have been so set aside in trust.

ARTICLE XIV

MISCELLANEOUS
PROVISIONS

Section 1401.  Consents and Other Instruments by Bondowners

(a)  Any consent,
request, direction, approval, objection or other instrument required by this
Indenture to be signed and executed by the Bondowners may be in any number of
concurrent writings of similar tenor and may be signed or executed by such
Bondowners in person or by agent appointed in writing.  Proof of the execution of any such instrument
or of the writing appointing any such agent and of the ownership of Bonds, if
made in the following manner, shall be sufficient for any of the purposes of
this Indenture, and shall be conclusive in favor of the Trustee with regard to
any action taken, suffered or omitted under any such instrument, namely:

(1)  The fact and date of the execution by any person of any
such instrument may be proved by the certificate of any officer in any
jurisdiction who by law has power to take acknowledgments within such
jurisdiction that the person signing such instrument acknowledged before him
the execution thereof, or by affidavit of any witness to such execution.

(2)  The fact of ownership of Bonds and the amount or amounts,
number and other identification of such Bonds, and the date of holding the same
shall be proved by the registration books of the Issuer maintained by the
Trustee.

(b)  In determining whether the
Bondowners owning the requisite principal amount of Bonds Outstanding have
given any request, demand, authorization, direction, notice, consent or waiver
under this Indenture, unless 100% of the Bonds are owned by Tenant or an
affiliate of Tenant, Bonds owned by the Tenant or any affiliate of the Tenant
shall be disregarded and deemed 

 31
 

not to be Outstanding under this Indenture, except that, in determining
whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Bonds which
the Trustee knows to be so owned shall be so disregarded.  For purposes of this paragraph, the word “affiliate”
means any person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Tenant; and for the purposes of this
definition, “control” means the power to direct the management and policies of
such person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise. 
Notwithstanding the foregoing, Bonds so owned which have been pledged in
good faith shall not be disregarded as aforesaid if the pledgee establishes to
the satisfaction of the Trustee the pledgee’s right so to act with respect to
such Bonds and that the pledgee is not the Tenant or any affiliate of the
Tenant.

Section 1402.  Limitation
of Rights Under the Indenture 
With the exception of rights herein expressly conferred, nothing
expressed or mentioned in or to be inferred from this Indenture or the Bonds is
intended or shall be construed to give any person other than the parties
hereto, and the Bondowners, any right, remedy or claim under or with respect to
this Indenture, and all of the covenants, conditions and provisions hereof
being intended to be and being for the sole and exclusive benefit of the
parties hereto, the Tenant and the Bondowners as herein provided.

Section 1403.  Notices  Any notice, request, complaint, demand or
other communication required or desired to be given or filed under this
Indenture shall be in writing and shall be deemed duly given or filed if the
same shall be duly mailed by registered or certified mail, postage prepaid, to
the Notice Representative.

All notices given by certified or registered mail
as aforesaid shall be deemed duly given as of the date they are so mailed.  A duplicate copy of each notice, certificate
or other communication given hereunder by either the Issuer or the Tenant to
the other shall also be given to the Trustee. 
The Issuer, the Trustee and the Tenant may from time to time designate,
by notice given hereunder to the others of such parties, such other address to
which subsequent notices, certificates or other communications shall be sent.

Section 1404.  Suspension
of Mail Service  If, because
of the temporary or permanent suspension of regular mail service or for any
other reason, it is impossible or impractical to mail any notice in the manner
herein provided, then such other form of notice as shall be made with the
approval of the Trustee shall constitute a sufficient notice.

Section 1405.  Severability  If any provision of this Indenture shall be
held or deemed to be invalid, inoperative or unenforceable as applied in any
particular case in any jurisdiction or jurisdictions or in all jurisdictions,
or in all cases because it conflicts with any other provision or provisions
hereof or any constitution or statute or rule of public policy, or for any
other reason, such circumstances shall not have the effect of rendering the
provision in question inoperative or unenforceable in any other case or
circumstance, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to any extent whatever.

 32
 

Section 1406.  Execution in
Counterparts  This Indenture
may be simultaneously executed in several counterparts, each of which shall be
an original and all of which shall constitute but one and the same instrument.

Section 1407.  Governing
Law  This Indenture shall be
governed exclusively by and construed in accordance with the applicable laws of
the State.

(THE REMAINDER OF THIS PAGE LEFT
INTENTIONALLY BLANK)

 33
 

IN WITNESS WHEREOF, the Issuer has caused this Indenture to be signed
by an authorized official, such signature to be attested by an authorized
officer and its official seal to be applied.

 

	
  

  	
   

  	
   

  	
  CITY OF ATCHISON, KANSAS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [SEAL]

  	
   

  	
   

  	
  By:

  	
  /s/ Dan Garrity

  
	
   

  	
   

  	
   

  	
   

  	
  Mayor

  
	
  ATTEST:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Sheldon Hamilton

  	
   

  	
   

  	
   

  	
   

  
	
  City Clerk

  	
   

  	
   

  	
  “ISSUER”

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
						

 

ACKNOWLEDGMENT

	
  STATE OF KANSAS

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
  ) SS:

  	
   

  	
   

  	
   

  
	
  COUNTY OF ATCHISON

  	
  )

  	
   

  	
   

  	
   

  

 

This instrument was acknowledged before me on the
27th day of December, 2006 by Dan Garrity as Mayor of the City of Atchison,
Kansas, a municipal corporation of the State of Kansas.

	
  [SEAL]

  	
   

  	
  /s/Rona M. Downing

  	
   

  	
   

  
	
   

  	
   

  	
  Notary
  Public

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  My Appointment Expires:  6/27/09

  	
   

  	
   

  

 

 34
 

IN WITNESS WHEREOF, and to evidence its acceptance of the trusts
hereby created, the Trustee has caused this Indenture to be signed in its name
and behalf and such signature to be attested by its duly authorized officers,
and its corporate seal to be applied, all as of the date first above written.

 

	
  

  	
   

  	
   

  	
   

  	
  COMMERCE BANK, N.A.

  
	
   

  	
   

  	
   

  	
   

  	
  Kansas City, Missouri,

  
	
   

  	
   

  	
   

  	
   

  	
  as Trustee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [SEAL]

  	
   

  	
   

  	
  By:

  	
  /s/ Merry Evans

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Merry Evans

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Illegible

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
  “TRUSTEE”

  

 

ACKNOWLEDGMENT

	
  STATE OF MISSOURI

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
  )  SS.

  	
   

  	
   

  	
   

  
	
  COUNTY OF JACKSON

  	
  )

  	
   

  	
   

  	
   

  
						

 

This instrument was acknowledged before me on the 27th
day of December, 2006, by Merry Evans, Vice President of Commerce Bank, N.A., a
banking corporation or association organized under the laws of the United
States of America or one of the states thereof.

	
  [SEAL]

  	
   

  	
  /s/ Lynda S. Thurston

  	
   

  	
   

  
	
   

  	
   

  	
  Notary Public

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  My Appointment Expires:

  	
   

  	
   

  	
   

  	
   

  
	
  April 25, 2008

  	
   

  	
   

  	
   

  	
   

  

 

 

 35

SCHEDULE I

DESCRIPTION OF PROPERTY

The following property acquired by the City of
Atchison, Kansas (the “Issuer”) in connection with the issuance by the City of
its Taxable Industrial Revenue Bonds, Series 2006 (MGP Ingredients Project)
(the “Series 2006 Bonds”):

(a)  The following described real estate
in Atchison County, Kansas:

Tract
1:  Beginning at the Northeast corner of
Lot Fourteen (14), Block Twenty (20); Thence North 90°00’00” East 90.16 feet
along the South line of Commercial Street to a point 24.84 feet West of the
Northeast corner of Lot One (1), in Block Twenty (20); Thence South 00°11’50”
West 135.0 feet to a point 25.19 feet West of the Southeast corner of Lot Three
(3) in Block Twenty (20); Thence South 90°00’00” West 189.81 feet to the Southwest
corner of Lot Twelve (12) in said Block; Thence North 00°03’00” East 67.50 feet
along the East line of Second Street to the North one-half of Lot Thirteen (13)
in said Block; Thence North 90°00’00” East 100.0 feet along the North one-half
of Lot Thirteen (13) to the East line of Lot Thirteen (13); Thence North 00°03’00”
East 67.50 feet along the East line of the North one-half of Lot Thirteen (13)
and all of Lot Fourteen (14) to the point of beginning, all lying in Block
Twenty (20) in that part of the City of Atchison known and designated as “Old
Atchison.”

Tract
2:  The North One-half (N 1/2) of Lot
Thirteen (13), and all of Lot Fourteen (14), in Block Twenty (20), in that part
of the City of Atchison usually known and designated as “Old Atchison.”

Tract
3:  Lots One (1), Two (2) and Three (3),
in Block Nineteen (19), in that part of the City of Atchison usually known and
designated as “Old Atchison.”

said real property constituting the “Land” as defined in the Lease
entered into by the Issuer concurrently with the issuance of the Series 2006
Bonds (the “Lease”), subject to the following (“Permitted Encumbrances”):

(1)           2006
real estate taxes due but not yet payable;

(2)           Assessments,
if any, attributable to watershed district;

(3)           Any
other general or special assessments, any and all recorded easements,
reservations, restrictions, agreements, encroachments and encumbrances, matters
which would be shown by an accurate survey, underground and overhead cables,
lines and utility services, and all existing zoning ordinances, laws, codes,
statutes and subdivision regulations and other governmental laws, rules, codes,
statutes and regulations limiting or restricting the use to which the property
may be put.

(b)  All buildings, building additions,
improvements, machinery and equipment constructed, located or installed on the
Land, all or any portion of the costs of which were paid from the proceeds of
the Series 2006 Bonds, and which constitute Improvements as referred to in the
Lease, together with any substitutions or replacements therefor, the property
described in paragraphs (a) and (b) of this Schedule I together constituting
the “Project” as referred to in the Lease.

 

 S-1

APPENDIX A

FORM OF BONDS

FACE OF THE BOND

	
  No.

  	
   

  	
   

  	
  $

  	
   

  	
   

  

 

United States of America

State of Kansas

City of Atchison, Kansas

Taxable Industrial Revenue Bond

Series 2006

(MGP Ingredients Project)

	
  

  	
  Rate of

  	
   

  	
  Maturity

  	
   

  	
  Dated

  	
   

  	
   

  	
   

  
	
  

  	
  Interest:

  	
   

  	
  %

  	
  Date: 12-01-16

  	
  Date: Issue Date

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Registered Owner:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Principal Amount:

  	
   

  	
  Dollars

  	
   

  	
   

  
													

 

The City of Atchison, Kansas, a body politic and
corporate, incorporated as a city of the first class of the State of Kansas
(the “Issuer”), for value received, promises to pay, but solely from the
sources hereinafter referred to, to the registered owner identified above, or
registered assigns, upon the presentation and surrender of this Certificate,
the principal sum identified above on the maturity date shown, in lawful money
of the United States of America, at the principal offices of Commerce Bank,
N.A. (the “Paying Agent” and “Trustee”), and in like manner to pay to the
registered Owner (the “Owner”) hereof, by check or draft mailed to the Owner at
his address as it appears on the bond registration books of the Issuer kept by
the Trustee under the within mentioned Indenture, or at such other address as
is furnished in writing by such registered Owner to the Paying Agent at the
close of business on the 15th day of the month next preceding the applicable
Interest Payment Date (the “Record Date”), interest on said principal sum from
the dated date hereof or the most recent Interest Payment Date to which
interest has been paid or duly provided for at the rate of interest per annum
set forth above (computed on the basis of a 360-day year of twelve 30-day
months), annually on December 1 of each year, commencing December 1, 2007
(the “Interest Payment Dates”), until the principal sum is paid, unless the
Bonds represented by this certificate shall have been previously called for
redemption and payment as hereinafter set forth.

 A-1
 

This Bond certificate evidences ownership of a
part of a duly authorized series of Bonds of the Issuer designated “City of
Atchison, Kansas, Taxable Industrial Revenue Bonds, Series 2006 (MGP
Ingredients Project),” in the aggregate original principal amount of $7,000,000
(the “Series 2006 Bonds”), issued for the purpose of providing funds to pay the
costs of acquiring, constructing, furnishing and equipping an office building
and technical center facility (the “Project”), to be leased by the Issuer to
MGP Ingredients, Inc., a Kansas corporation (the “Tenant”), under the terms of
a Lease dated as of the Issue Date of the Series 2006 Bonds, between the Issuer
and the Tenant (said Lease, as amended and supplemented from time to time in
accordance with the provisions thereof, being herein called the “Lease”), all
pursuant to the authority of and in conformity with the provisions,
restrictions and limitations of the constitution and statutes of the State of
Kansas, including particularly K.S.A. 12-1740 et seq.,
as amended, and pursuant to proceedings duly had by the governing body of the
Issuer.

The Series 2006 Bonds are issued under and are
equally and ratably secured and entitled to the protection of the Trust
Indenture, dated as of the Issue Date of the Series 2006 Bonds (said Trust
Indenture, as amended and supplemented from time to time in accordance with the
provisions thereof, being herein called the “Indenture”), between the Issuer
and the Trustee.  Subject to the terms
and conditions set forth therein, the Indenture permits the Issuer to issue
Additional Bonds (as defined therein) secured by the Indenture ratably and on a
parity with the Series 2006 Bonds (the Series 2006 Bonds together with such
Additional Bonds being herein referred to collectively as the “Bonds”).  Reference is hereby made to the Indenture for
a description of the provisions, among others, with respect to the nature and
extent of the security for the Bonds, the rights, duties and obligations of the
Issuer, the Trustee and the Bondowners, and the terms upon which the Bonds are
issued and secured.

REDEMPTION OF BONDS

Extraordinary Optional
Redemption.  In the event of a Change of Circumstances (as
defined in the Indenture), the Series 2006 Bonds shall be subject to redemption
and payment prior to the stated maturity thereof at the option of the Issuer,
upon instructions from the Tenant, on any date, at the par value of the
principal amount thereof, plus accrued interest thereon to the redemption date,
without premium.

Optional Redemption.  The
outstanding principal of the Series 2006 Bonds is subject to redemption and payment
prior to maturity at the option of the Issuer, upon instructions from the
Tenant, as a whole or in part on any date, at the redemption price of the par
value of the principal amount thereof, without premium, plus accrued interest
thereon to date fixed for redemption and payment.

When any Bonds are called for redemption as
aforesaid, unless waived, notice thereof identifying the Bonds to be redeemed
will be given by mailing a copy of the redemption notice at least 30 days prior
to the date fixed for redemption to the Owner of each Bond to be redeemed at
the address shown on the registration books maintained by the Trustee;
provided, however, that failure to give such notice by mailing as aforesaid, or
any defect therein, shall not affect the validity of any proceedings for the
redemption of Bonds.  If less than all of
the Outstanding Bonds of this series are called for redemption, Bonds shall be
redeemed as directed in writing by the 

 A-2
 

Tenant.  Bonds of less than a full
maturity shall be selected by the Trustee in such equitable manner as it may
determine.  All Bonds so called for
redemption will cease to bear interest on the specified redemption date and
shall no longer be secured by the Indenture and shall not be deemed to be
Outstanding under the provisions of the Indenture.

The Bonds and the interest thereon are limited
obligations of the Issuer payable exclusively out of the Trust Estate under the
Indenture, including but not limited to the rents, revenues and receipts under
the Lease, and are secured by a pledge of the Project (including any Project
Additions) as described in the Lease and a pledge and assignment of the Trust
Estate, including all rentals and other amounts to be received by the Issuer
under and pursuant to the Lease, all as provided in the Indenture.  The Bonds and the interest thereon do not
constitute a debt or general obligation of the Issuer, the State of Kansas or
any municipal corporation thereof, and are not payable in any manner by taxation.  The Bonds do not constitute an indebtedness
within the meaning of constitutional or statutory debt limitations or
restrictions.  Pursuant to the provisions
of the Lease, Basic Rent is to be paid by the Tenant directly to the Trustee
for the account of the Issuer and deposited in a special trust account created
by the Issuer and designated “City of Atchison, Kansas, Debt Service Fund for
Taxable Industrial Revenue Bonds (MGP Ingredients Project).”

No Owner of Bonds shall have the right to enforce
the provisions of the Indenture or to institute action to enforce the covenants
therein, or to take any action with respect to any event of default under the
Indenture, or to institute, appear in or defend any suit or other proceedings
with respect thereto, except as provided in the Indenture.  In certain events, on the conditions, in the
manner and with the effect set forth in the Indenture, the principal of all the
Bonds issued under the Indenture and then Outstanding may become or may be
declared due and payable prior to the stated maturity thereof, together with
interest accrued thereon.  Modifications
or alterations of this Bond or the Indenture may be made only to the extent and
under the circumstances permitted by the Indenture.

This Bond certificate is transferable, as provided
in the Indenture, only upon the registration books of the Trustee maintained
for the Issuer kept for that purpose at the above mentioned office of the Bond
Registrar and Paying Agent by the Owner hereof in person or by his duly
authorized attorney, upon surrender of this Bond together with a written
instrument of transfer satisfactory to the Trustee duly executed by the Owner
or such Owner’s duly authorized attorney, and thereupon a new Bond certificate
in the same aggregate principal amount, shall be issued to the transferee in
exchange therefor as provided in the Indenture, and upon payment of the charges
therein prescribed. The Tenant has agreed to pay as Additional Rent under the
Lease all costs incurred in connection with the issuance, transfer, exchange,
registration, redemption or payment of the Bonds except (a) the reasonable fees
and expenses in connection with the replacement of certificates mutilated,
stolen, lost or destroyed or (b) any tax or other governmental charge imposed
in relation to the transfer, exchange, registration, redemption or payment of
the Bonds.  The Issuer, the Trustee and
any Paying Agent may deem and treat the person in whose name this Bond
certificate is registered as the absolute Owner hereof for the purpose of
receiving payment of, or on account of, the principal or redemption price
hereof and interest due hereon and for all other purposes.

 A-3
 

This Bond certificate shall not be valid or become
obligatory for any purpose or be entitled to any security or benefit under the
Indenture until the Certificate of Authentication hereon shall have been
executed by the Trustee.

IT IS HEREBY CERTIFIED AND
DECLARED that all acts,
conditions and things required to exist, happen and be performed precedent to
and in the execution and delivery of the Indenture and the issuance of the
Bonds do exist, have happened and have been performed in due time, form and
manner as required by law.

 A-4
 

IN WITNESS WHEREOF, Issuer has caused this Bond certificate to be
executed in its name by the manual or facsimile signature of its Mayor and
attested by the manual or facsimile signature of its City Clerk and its
official seal to be affixed hereto or imprinted hereon, and has caused the
Bonds to be dated as of the Issue Date of the Bonds.

	
  

  	
   

  	
  CITY OF ATCHISON, KANSAS

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Facsimile Seal)

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Dan Garrity, Mayor

  	
   

  
	
  ATTEST:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sheldon Hamilton, City Clerk

  	
   

  	
   

  	
   

  	
   

  
						

 

 A-5
 

(FORM OF CERTIFICATE OF AUTHENTICATION)

This Bond certificate evidences ownership of the City of Atchison,
Kansas Taxable Industrial Revenue Bonds, Series 2006 (MGP Ingredients Project),
as described herein and in the Bond Agreement described herein.  The Issue Date of this Bond is
_______________ ______, 2006.

	
  

  	
   

  	
   

  	
  COMMERCE BANK,
  N.A.

  	
   

  
	
   

  	
   

  	
   

  	
  Kansas City, Missouri,

  	
   

  
	
   

  	
   

  	
   

  	
  as Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Authorized Officer

  	
   

  
						

 

 A-6
 

(FORM OF
ASSIGNMENT)

For value received, the undersigned hereby sells,
assigns and transfers unto

	
  

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Print or Type Name and Address of Transferee

  	
   

  	
   

  	
   

  

 

the Bonds represented by this certificate and all rights thereunder, and
hereby authorizes the transfer of the within Bond on the books kept by the Bond
Registrar and Paying Agent for the registration and transfer of Bonds.

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NOTICE: The signature to this
  assignment must correspond with the name as it appears upon the face of the
  within Bond in every particular.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature Guaranteed By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [Seal of Bank]

  	
   

  	
   

  	
  (Name of Eligible Guarantor Institution)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	 

	
   

  	
   

  	
   

  	
  Title:

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

										

 

Signature
must be guaranteed by an eligible guarantor institution as defined by S.E.C.
Rule 17 Ad-15 (17 C.F.R. 240. 17-Ad-15)

 

THIS BOND
MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE APPLICABLE PROVISIONS OF
THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS,
OR IN A TRANSACTION EXEMPT FROM THE APPLICATION OF FEDERAL AND STATE SECURITIES
LAWS.

 

 A-7

APPENDIX B

GLOSSARY OF WORDS AND
TERMS

“Act” means K.S.A. 12-1740 et seq.,
as amended.

“Additional Bonds” means any Bonds issued in addition to the Series
2006 Bonds pursuant to Section 209 of
this Indenture.

“Authorized Tenant Representative” means Chief financial Officer of the Tenant, or
such other person as is designated to act on behalf of the Tenant as evidenced
by written certificate furnished to Trustee, containing the specimen signature
of such person and signed on behalf of the Tenant by its Chief Executive
Officer.  Such certificate may designate
an alternate or alternates, each of whom shall be entitled to perform all
duties of the Authorized Tenant Representative.

“Bond” or “Bonds” means
the Series 2006 Bonds and any Additional Bonds.

“Bond Counsel” means the firm of Gilmore & Bell, P.C. or any
other attorney or firm of attorneys whose expertise in matters relating to the
issuance of obligations by states and their political subdivisions is
nationally recognized and acceptable to Issuer and Tenant.

“Bondowner” means the Tenant.

“Business Day” means a day which is not a Saturday, Sunday or any
day designated as a holiday by the Congress of the United States or by the
legislature of the State and on which banks in the State are not authorized to
be closed.

“Change of Circumstances” means the occurrence of any of the following
events:

(1)  title to, or the temporary use of,
all or any substantial part of the Land or the Project shall be condemned by
any authority exercising the power of eminent domain;

(2)  title to such portion of the Land
is found to be deficient or nonexistent to the extent that the Project is
untenantable or the efficient utilization of the Project by the Tenant is
substantially impaired;

(3)  substantially all of the
Improvements are damaged or destroyed by fire or other casualty; or

(4)  as a result of: (i) changes in the
constitution of the State; or (ii) any legislative or administrative action by
the State or any political subdivision thereof, or by the United States; or
(iii) any action instituted in any court, the Lease shall become void or
unenforceable, or impossible of performance without unreasonable delay, or in
any other way by reason of such changes of circumstances, unreasonable burdens
or excessive liabilities are imposed upon Issuer or Tenant.

 B-1
 

“Completion Date” means the date of actual completion of the
acquisition, purchase, construction and installation of the Project and any
Improvements pursuant to the Lease.

“Construction Period” means the period from the beginning of
acquisition or construction of the Project and any Improvements to their
Completion Date.

“Costs of Issuance” means any and all expenses of whatever nature
incurred in connection with the issuance and sale of Bonds, including, but not
limited to, underwriting fees and expenses, underwriting discount, initial fees
of the Trustee, administrative fees or expenses of the Issuer, bond and other
printing expenses and legal fees and expenses of Bond Counsel, Issuer’s counsel
and counsel for the Tenant.

“Debt Service Fund” means the “City of Atchison, Kansas Debt Service
Fund for Taxable Industrial Revenue Bonds (MGP Ingredients Project)” created
pursuant to Section 601 of this Indenture.

“Default Administration Costs” means the reasonable fees, charges, costs,
advances and expenses of the Trustee incurred in anticipation of an Event of
Default, or after the occurrence of an Event of Default, including, but not
limited to, counsel fees, litigation costs and expenses, the expenses of
maintaining and preserving the Project and the expenses of re-letting or
selling the Project.

“Event of Default” means one of the following events:

(a)  Default in the due and punctual
payment of any interest on any Bond;

(b)  Default in the due and punctual
payment of the principal of or premium, if any, on any Bond on the stated
maturity or accelerated maturity date thereof, or at the redemption date
thereof;

(c)  Default in the performance or
observance of any other of the covenants, agreements or conditions on the part
of the Issuer in this Indenture or in any Bonds contained, and the continuance
thereof for a period of 30 days after written notice thereof shall have been
given to the Issuer and the Tenant by the Trustee, or to the Trustee, the
Issuer and the Tenant by Bondowners owning not less than 25% in aggregate
principal amount of Bonds then Outstanding; provided, however, if any default
shall be such that it cannot be corrected within such 30-day period, it
shall not constitute an Event of Default if corrective action is instituted by
the Issuer or the Tenant within such period and diligently pursued until such
default is corrected; or

(d)  An “Event of Default” as defined in
the Lease.

“Government Securities” means direct obligations of, or obligations the
payment of the principal of and interest on which are unconditionally
guaranteed by, the United States of America.

 B-2
 

“Improvements” means all buildings, building improvements,
machinery and equipment (whether affixed or not) purchased in whole or in part
from the proceeds of the Series 2006 Bonds or any Additional Bonds.

“Indenture” means this Trust Indenture, as from time to time
amended and supplemented by Supplemental Indentures in accordance with the
provisions of Article XI of this Indenture.

“Interest Payment Date” means any date on which any interest is payable
on any Bond.  With respect to the Series
2006 Bonds, it means December 1 in each year, commencing as of December 1,
2007.

“Investment Contract” means an agreement to deposit all or any portion
of the proceeds of the sale of the Bonds with a bank, with the deposits to bear
interest at an agreed rate.

“Investment Securities” means any of the following securities, and to the
extent the same are at the time permitted for investment of funds held by the
Trustee pursuant to this Indenture:

(i)  Government Securities;

(ii)  obligations of the Federal
National Mortgage Association, the Government National Mortgage Association,
the Federal Financing Bank, the Federal Intermediate Credit Corporation,
National Bank for Cooperatives, Federal Land Banks, Federal Home Loan Banks,
Farmers Home Administration and Federal Home Loan Mortgage Association;

(iii)  savings or other depository
accounts or certificates of deposit, whether negotiable or nonnegotiable,
issued by any bank or trust company organized under the laws of any state of
the United States of America or any national banking association (including the
Trustee and its affiliates) approved by Tenant, provided that, if Tenant is not
the sole bondholder, such deposits shall be either of a bank, trust company or
national banking association continuously and fully insured by the Federal
Deposit Insurance Corporation, or continuously and fully secured by excess
deposit insurance purchased through a private insurer, or such securities as
are described above in clauses (i) or (ii), which shall have a market value
(exclusive of accrued interest) at all times at least equal to the principal
amount of such deposits and shall be lodged with the Trustee, as custodian, by
the bank, trust company or national banking association accepting such deposit
or issuing such certificate of deposit, and the bank, trust company or national
banking association issuing each such certificate of deposit required to be so
secured shall furnish the Trustee an undertaking satisfactory to it that the
aggregate market value of all such obligations securing each such certificate
of deposit will at all times be an amount equal to the principal amount of each
such certificate of deposit and the Trustee shall be entitled to rely on each
such undertaking;

(iv)  any Investment Contract or
repurchase agreement with any bank or trust company organized under the laws of
any state of the United States of America or any national banking association
(including the Trustee) or government bond dealer reporting to, trading with,
and recognized as a primary dealer by the Federal Reserve Bank of New York,
which agreement is secured by any one or more of the securities described in
clauses (i) or (ii) above;

 B-3
 

(v)  any investment in shares or units
of a money market fund or trust determined by Trustee to be suitable for
investment of trust funds (including one offered, managed or otherwise made
available through the Trustee or any affiliate);

(vi) 
investments in shares or units of a money market fund or trust, the
portfolio of which is comprised entirely of securities described in clauses
(i), (ii) or (iii) above.

“Issue Date” means
the date on which the initial Bond certificates representing the Bonds is
authenticated by the bond registrar and delivered in exchange for payment of
their purchase price.

“Issuer” means the City of Atchison, Kansas, a body
politic and corporate incorporated as a city of the first class under the laws
of the State, and its successors and assigns.

“Land” means the real property (or interests therein)
described in Schedule I.

“Lease” means the Lease delivered concurrently with this
Indenture between the Issuer and the Tenant, as from time to time amended and
supplemented in accordance with the provisions thereof and of Article XII of this Indenture.

“Notice Representative” means:

(1)  With respect to the Tenant, its
chief executive officer at its Notice Address (as defined in the Lease).

(2)  With respect to the Issuer, its
duly acting clerk at its Notice Address (as defined in the Lease).

(3)  With respect to the Trustee, any
corporate trust officer at its Notice Address (as defined in the Lease).

“Original Proceeds” means all sale proceeds, including accrued
interest, from sale of the Series 2006 Bonds to the Original Purchaser and all
investment earnings credited to the Project Fund prior to the Completion Date.

“Original Purchaser” means MGP Ingredients, Inc., Atchison, Kansas.

“Outstanding” means, as of a particular date all Bonds issued,
authenticated and delivered under this Indenture (including any Supplemental
Indentures), except:

(a)  Bonds canceled by the Trustee or
delivered to the Trustee for cancellation pursuant to this Indenture;

(b)  Bonds for the payment or redemption
of which moneys or investments have been deposited in trust with the Trustee
and irrevocably pledged to such payment of redemption in accordance with the
provisions of Section 1302 of this Indenture;
and

 B-4
 

(c)  Bonds in exchange for or in lieu of
which other Bonds have been authenticated and delivered pursuant to this
Indenture.

“Owner” means the owner of any Bond as shown on the
registration books of the Trustee maintained as provided in this Indenture.

“Paying Agent” means the Trustee.

“Payment Date” means any Interest Payment Date or any Principal
Payment Date.

“Permitted Encumbrances” means any mortgages, liens or other encumbrances
specifically described in Schedule I;
easements and rights-of-way of record at the time of conveyance of the Land to
the Issuer, and any other title exceptions not affecting marketability or the
usefulness of the Project to Tenant.

“Principal Payment Date” means any date on which principal on any Bond is
due and payable, whether at the stated maturity or earlier required redemption
thereof.  With respect to the Series 2006
Bonds, the Principal Payment Date is December 1, 2016.

“Project” means the Land and the Improvements, together
with any Project Additions.

“Project Additions” means any additional Improvements or any
modifications, extensions or enlargements of the Improvements acquired,
constructed or installed from proceeds of any series of Additional Bonds
authorized and issued pursuant to this Indenture.  It also includes any alterations or additions
made to the Project to the extent provided in Articles XI
and XII of the Lease.

“Project Costs” means those costs incurred in connection with the
Land, and the construction or installation of any Improvements, including:

(a)  all costs and expenses necessary or
incident to the acquisition of the Land and such of the Improvements as are
acquired, constructed, installed or in progress at the date of such issuance of
the Series 2006 Bonds;

(b)  fees and expenses of architects,
appraisers, surveyors, engineers and other professional consultants for
estimates, surveys, soil borings and soil tests and other preliminary
investigations and items necessary to the commencement of acquisition,
construction, preparation of plans, drawings and specifications and supervision
of construction and installation, as well as for the performance of all other
duties of architects, appraisers, surveyors, engineers and other professional
consultants in relation to the acquisition, construction or installation of the
Improvements or the issuance of Bonds;

(c)  all costs and expenses incurred in
constructing, acquiring or installing the Improvements;

 B-5
 

(d)  payment of interest actually
incurred on any interim financing obtained from a lender unrelated to the
Tenant for acquisition or performance of work on the Improvements prior to the
issuance of the Bonds;

(e)  the cost of the title insurance
policies and the cost of any insurance and performance and payment bonds
maintained during the Construction Period in accordance with Article VI of the Lease, respectively;

(f)  interest accruing on the Series
2006 Bonds prior to the Completion Date, if and to the extent Original Proceeds
deposited to the credit of the Debt Service Fund pursuant to Section 602 of this Indenture are insufficient for payment
of such interest; and

(g)  Costs of Issuance.

“Project Fund” means the fund authorized and established with
the Trustee pursuant to the Indenture and designated the “City of Atchison,
Kansas Project Fund (MGP Ingredients Project), including the Project Account
and the Costs of Issuance Account.”

“Record Date” means the 15th day of the month in each year
preceding each Interest Payment Date, or if such date is not a Business Day,
the Business Day immediately preceding such date.

“Rental Payments” means the aggregate of the Basic Rent and Additional
Rent payments provided for pursuant to Article III of
the Lease.

“Series 2006 Bonds” means the City of Atchison, Kansas Taxable
Industrial Revenue Bonds, Series 2006 (MGP Ingredients Project) dated their
Issue Date in the aggregate principal amount of $7,000,000.

“State” means the State of Kansas.

“Supplemental Indenture” means any indenture supplementing or amending
this Indenture entered into by the Issuer and the Trustee pursuant to Article XI of this Indenture.

“Tenant” means MGP Ingredients, Inc., its successors and
assigns.

“Trust Estate” means the Trust Estate described in the Granting
Clauses of this Indenture.

“Trustee” means Commerce Bank, N.A., Kansas City, Missouri,
a banking corporation or association incorporated under the laws of the United
States or one of the states thereof, in its capacity as trustee, bond registrar
and paying agent, and its successor or successors serving as Trustee under this
Indenture.

 

 B-6Exhibit
10.1

INDEMNIFICATION AGREEMENT

THIS AGREEMENT, dated as of       
day of the             ,
2006, by and between MGP INGREDIENTS, INC.,
a Kansas corporation (the “Company”) and                                                                   (the “Indemnitee”).

WHEREAS, it is essential to the Company to retain and
attract as directors and officers the most capable persons available; and

WHEREAS, Indemnitee is a
director or officer of the Company; and

WHEREAS, both the Company and Indemnitee recognize the
increased risk of litigation and other claims being asserted against directors
and officers of public companies in today’s environment; and

WHEREAS, the Kansas legislature, in recognition of the
need to secure the continued service of competent and experienced people in
senior corporate positions and to assure that they will be able to exercise
judgment without fear of personal liability so long as they fulfill the basic
duties of honesty, care and good faith, has enacted K.S.A. 17-6305, which empowers
the Company to indemnify its officers, directors, employees and agents and
expressly provides that the indemnification provided by the statute is not
exclusive; and

WHEREAS, the Bylaws of the Company require the Company
to indemnify and advance expenses to its directors and officers to the fullest
extent now or hereafter authorized by the Kansas Statutes Annotated, and the
Bylaws, further, provide that the right to indemnification and payment of
expenses conferred therein shall not be exclusive of any other right which any
person may have or acquire under any statute, provision of the Articles of
Incorporation, bylaw, agreement, vote of stockholders or disinterested
directors, or otherwise; and

WHEREAS, in recognition of the fact that the
Indemnitee continues to serve as a director or officer of the Company, in part
in reliance on the Bylaws, and of the fact of Indemnitee’s need for substantial
protection against personal liability in order to enhance Indemnitee’s
continued service to the Company in an effective manner, and in part to provide
Indemnitee with specific contractual assurance that the protection promised by
the Bylaws will be available to Indemnitee (regardless of, among other things,
any amendment to the Bylaws or any change in the composition of the Company’s
Board of Directors or any acquisition transaction relating to the Company), and
due to the possibility that the Company’s directors’ and officers’ liability
insurance coverage could at some future time become inadequate, the Company
wishes to provide in this Agreement for the indemnification of, and the
advancing of expenses to, Indemnitee to the fullest extent (whether partial or
complete) now or hereafter authorized or permitted by law and as set forth in
this Agreement, and, to the extent insurance is maintained, for the continued
coverage of Indemnitee under the Company’s directors’ and officers’ liability
insurance policies;

NOW, THEREFORE, in consideration of the premises and
of Indemnitee continuing to serve the Company directly or, at its request,
through service to another enterprise, and intending to be legally bound
hereby, the parties hereto agree as follows:

1.                                       CERTAIN
DEFINITIONS:

(a)                                  “Acquiring
Person” means a person, entity or group that has made an acquisition described
in Section 1(e)(i) or the reorganized or surviving company in a reorganization
or consolidation described in Section 1(e)(iii).

(b)                                 “Approved
Law Firm” shall mean any law firm that has at least twenty (20) attorneys
(wherever located) and an office located in Kansas and is rated “av” by
Martindale-Hubbell Law Directory; provided, however, that such law firm shall
not, for a five-year period prior to the earliest date as of which Indemnitee
first has actual knowledge of the relevant Indemnifiable Claim, have been
engaged by the Company, an Acquiring Person, any affiliate or associate of an
Acquiring Person, or Indemnitee.

(c)                                  “Applicable
Standard of Conduct” shall mean the standard of conduct that must be satisfied
to permit indemnification under K.S.A. 17-6305(a) or (b), whichever is or would
be applicable under the circumstances.

(d)                                 “Board
of Directors” or “Board” shall mean the Board of Directors of the Company.

(e)                                  A
“Change in Control” shall be deemed to have occurred upon:

(i)                                     The
acquisition (other than from the Company) by any person, entity or “group,”
within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) (excluding, for this purpose, the
Company or its subsidiaries, any employee benefit plan of the Company or its
subsidiaries, trustees of the MGP Ingredients, Inc. Voting Trust or of the Cray
Family Trust, or any person who acquires common or preferred stock of the
Company from Cloud L. Cray, Jr. or from any trust controlled by or for the
benefit of Cloud L. Cray, Jr. prior to or as a result of his death), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of at least 30% of the then outstanding shares of common stock
and 50% of the then outstanding shares of $10 par value preferred stock of the
Company or 30% of the combined voting power of the Company’s then outstanding
voting securities entitled to vote generally in the election of directors; or

(ii)                                  The
cessation, for any reason, of individuals who, as of the date hereof,
constitute the Board (as of the date hereof the “Incumbent Board”) to
constitute at least a majority of the Board, provided that any person becoming
a director subsequent to the date hereof whose election, or nomination for election
by the Company’s stockholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the election of the
directors of the Company) shall be, for

 2
 

purposes of this Plan,
considered as though such person were a member of the Incumbent Board; or

(iii)                               Approval by the
stockholders of the Company of (A) a reorganization, merger or
consolidation, in each case, with respect to which persons who were the
stockholders of the Company immediately prior to such reorganization, merger or
consolidation do not, immediately thereafter, own collectively as a group more
than 50% of the combined voting power entitled to vote generally in the
election of directors of the reorganized or surviving company’s then
outstanding voting securities, or (B) a liquidation or dissolution of the
Company or the sale of all or substantially all of the assets of the Company.

(f)                                    “Claim” shall mean
any threatened, pending or completed action, suit or proceeding, or any inquiry
or investigation, whether conducted by the Company or any other party, that
Indemnitee in good faith believes might lead to the institution of any such
action, suit or proceeding, whether civil, criminal, administrative,
investigative or other.

(g)                                 “Company-Related
Enterprise” shall mean any corporation of any type or kind, domestic or
foreign, partnership, joint venture, trust, employee benefit plan or other
enterprise for which Indemnitee serves or has served as a Fiduciary at the
request of the Company.  For this
purpose, and without limitation of any indemnification provided hereunder, if
Indemnitee serves as a Fiduciary for (i) another corporation, partnership,
joint venture or trust of which 20 percent or more of the voting power or
residual economic interest is held, directly or indirectly, by the Company, or
(ii) any employee benefit plan of the Company or any entity referred to in
clause (i), Indemnitee shall be deemed to be doing or to have done so at the
request of the Company.

(h)                                 “Expenses” shall
include attorneys’ fees and all other costs, expenses and obligations
reasonably paid or incurred in connection with investigating, defending, being
a witness in or participating in (including on appeal), or preparing to defend,
be a witness in or participate in, any Indemnifiable Claim, together with
interest, computed at the Company’s average cost of funds for short-term
borrowings, accrued from the date of payment of such expense to the date
Indemnitee receives reimbursement therefor.

(i)                                     “Fiduciary” shall
mean director, officer, general partner, manager, employee, trustee, agent or
other fiduciary.

(j)                                     “Indemnifiable
Claim” shall mean any Claim based upon, or arising in whole or in part out of
(i) the fact that Indemnitee is or was a Fiduciary of the Company or is or was
a Fiduciary of any Company-Related Enterprise, (ii) anything done or not done
(or alleged to have been done or not done) by Indemnitee in any such capacity
or (iii) anything done or not done (or alleged to have been done or not done)
by Indemnitee in any other capacity for the Company or a Company-Related
Enterprise while serving as a Fiduciary of the Company or a Company-Related
Enterprise.

 3
 

(k)                                  “Reviewing Party”
shall be (i) the Board of Directors, acting by majority vote of directors (the “Disinterested
Directors”) who are not parties to the particular Claim with respect to which
Indemnitee is seeking indemnification, even through less than a quorum,
(ii) a committee of the Disinterested Directors designated by a majority
vote of the Disinterested Directors, even though less than a quorum, or
(iii) if there are no Disinterested Directors, or if the Disinterested
Directors so direct, (A) independent legal counsel or (B) the
stockholders.

2.                                       BASIC
INDEMNIFICATION ARRANGEMENT.  If
Indemnitee was, is or becomes at any time a party to, or witness or other
participant in, or is threatened to be made a party to, or witness or other
participant in, an Indemnifiable Claim, the Company shall indemnify Indemnitee
to the fullest extent now or hereafter authorized or permitted by law as soon
as practicable but in any event no later than 30 days after written demand is
presented to the Company, against any and all Expenses, judgments, fines
(including excise taxes assessed against Indemnitee with respect to an employee
benefit plan), penalties and amounts paid in settlement of such Claim
(including all interest, assessments and other charges paid or payable in
connection with, or in respect of, such Expenses, judgments, fines, penalties
or amounts paid in settlement).  If so
requested by Indemnitee, and upon compliance with the condition stated in
Section 3, the Company shall advance (within two business days of such
request and compliance) any and all Expenses to Indemnitee (an “Expense Advance”).  Notwithstanding anything in this Agreement to
the contrary, Indemnitee shall not be entitled to indemnification pursuant to
this Agreement (i) in respect of any Claim based upon or arising out of conduct
of Indemnitee that does not satisfy the Applicable Standard of Conduct, or (ii)
in any action by or in the right of the Company in which Indemnitee has been
finally adjudged to be liable to the Company, unless and only to the extent
that the court in which the proceeding was brought determines upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, the Indemnitee is fairly and reasonably entitled to
indemnity for such expenses as the court shall deem proper, nor shall the
Company be liable, unless otherwise provided by separate written agreement,
bylaw or other provision for indemnity, to make any payment in connection with
any Claim (x) for an accounting of profits made from the purchase or sale by
the Indemnitee of securities of the Company within the meaning of Section 16(b)
of the Securities Exchange Act of 1934 and amendments thereto, (y) for amounts
paid in settlement of any proceeding effected without the written consent of
the Company, which consent shall not be unreasonably withheld or (z) in
connection with any Claim initiated prior to a Change in Control by Indemnitee,
unless the Board of Directors has joined in or consented to the initiation of
such Claim.

3.                                       PAYMENT.

a.                                       Notwithstanding
the provisions of Section 2, the indemnification obligations of the Company
under Section 2 (which shall in no event be deemed to preclude any right to
indemnification to which Indemnitee may be entitled under K.S.A. 17-6305) shall
be subject to the condition that unless indemnification is ordered by a court,
the Reviewing Party shall have authorized such indemnification in the specific
case upon a determination that Indemnitee has met the Applicable Standard of
Conduct and

 4
 

that indemnification is
not precluded by circumstances described in the last sentence of Section 2 of
this Agreement.  If the Reviewing Party
is independent legal counsel, the determination shall be made in a written
opinion.

b.                                      The
Company shall promptly call a meeting of the Board of Directors with respect to
a Claim and agrees to use its best efforts to facilitate a prompt determination
by the Reviewing Party with respect to the Claim. Indemnitee shall be afforded
the opportunity to make submissions to the Reviewing Party with respect to the
Claim.

c.                                       
The Company shall have no obligation under this Agreement to make an Expense
Advance pursuant to Section 2 with respect to matters described in clauses (y)
and (z) of the last sentence of Section 2.

d.                                      The
obligation of the Company to make an Expense Advance pursuant to Section 2
shall only be subject to the condition that the Indemnitee must first deliver
to the Company a signed, written undertaking to repay the Expense Advance (i)
if and when Indemnitee settles any proceeding without the written consent of
the Company, which consent shall not be unreasonably withheld or (ii) if, when
and to the extent that the Reviewing Party determines that Indemnitee is not
entitled to be indemnified under Section 2 and applicable law; provided,
however, with respect to clause (ii), that if Indemnitee has commenced legal
proceedings in a court of competent jurisdiction to secure a determination that
Indemnitee is entitled to be indemnified under Section 2, applicable law or
both, any decision by the Reviewing Party not to authorize indemnification
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any Expense Advance until a final judicial determination is made
with respect thereto and all rights of appeal therefrom have been exhausted or
lapsed.

e.                                       
If a claim for indemnification or Expense advance has not been paid in full by
the Company within ninety (90) days after written demand is presented to the
Company, Indemnitee shall have the right to commence litigation in any court in
the State of Kansas having subject matter jurisdiction thereof and in which
venue is proper, seeking an initial determination by the court or challenging
any determination by the Reviewing Party or any aspect thereof, and the Company
hereby consents to service of process and agrees to appear in any such
proceeding.  It shall be a defense to any
such action (other than an action brought to enforce a claim for Expenses
incurred in defending any proceeding in advance of its final disposition where
the required undertaking has been tendered to the Company) that the Indemnitee
has not met the Applicable Standard of Conduct, but the burden of proving such
defense shall be on the Company. 
However, neither the failure of the Reviewing Party to have made a
determination prior to the commencement of such action that the Indemnitee has
met the Applicable Standard of Conduct, nor an actual determination by the
Reviewing Person that the Indemnitee had not met such Applicable Standard of
Conduct, shall be a defense to the action or create a presumption that the
Indemnitee has not met the Applicable Standard of Conduct.

4.                                       The
Company shall be entitled to participate at its expense in any proceeding for
which Indemnitee may be entitled to indemnity hereunder, and it may

 5
 

assume the defense
thereof with counsel satisfactory to the Indemnitee unless the Indemnitee
reasonably concludes that there may be a conflict of interest between the
Company and the Indemnitee in the conduct of such defense.

5.                                       CHANGE
IN CONTROL.  If there is a Change in
Control (other than a Change in Control which has been approved by a majority
of the directors who were directors immediately prior to such Change in Control
and were or are deemed to have been members of the Incumbent Board), then (i)
for the purpose of all authorizations and determinations pursuant to the first
sentence of Section 3 hereof and K.S.A. 17-6305, the Reviewing Party shall be
independent legal counsel and (ii) with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnification and Expense
Advances under this Agreement, the Company (including the Board of Directors)
shall seek legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld), and who (except in connection with such matters) has
not performed services for the Company (or any subsidiary of the Company) or an
Acquiring Person, any affiliate or associate of an Acquiring Person, or
Indemnitee within the five-year period prior to the earliest date as of which
Indemnitee first has actual knowledge of the relevant Indemnifiable Claim.  Unless Indemnitee has theretofore selected
counsel pursuant to this Section 4 and such counsel has been approved by the
Company, any Approved Law Firm selected by Indemnitee shall be deemed to be
approved by the Company.  Such counsel,
among other things, shall render their written opinion to the Company, the
Board of Directors and Indemnitee as to whether and to what extent Indemnitee
is entitled to be indemnified under applicable law.  The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully indemnify
such counsel, to the extent not prohibited by applicable rules of professional
conduct, against any and all expenses (including attorneys’ fees), claims,
liabilities and damages arising out of or relating to this Agreement or counsel’s
engagement pursuant hereto.  As used in
this Agreement, the terms “affiliate” and “associate” shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act as in effect on the date of this Agreement.

6.                                       INDEMNIFICATION
FOR ADDITIONAL EXPENSES.  The Company
shall indemnify Indemnitee against any and all expenses (including attorneys’
fees) that are reasonably incurred by Indemnitee in connection with any claim
successfully asserted, in whole or in part, or action brought by Indemnitee in
which the Indemnitee prevails, in whole or in part, for (i) indemnification or
advance payment of Expenses by the Company under this Agreement or any other
agreement or Bylaw of the Company now or hereafter in effect relating to
Indemnifiable Claims or (ii) recovery under any directors’ and officers’
liability insurance policies maintained by the Company.

7.                                       PARTIAL
INDEMNITY, ETC.  If Indemnitee is
entitled under any provision of this Agreement to indemnification by the
Company for a portion of the Expenses, judgments, fines, penalties and amounts
paid in settlement relating to a Claim but not, however, for all of the total
amount thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereof to which Indemnitee is entitled. Moreover, notwithstanding any
other provision of this Agreement, to the extent that Indemnitee has

 6
 

been successful on the
merits or otherwise in defense of any or all Indemnifiable Claims  or in defense of any issue or matter relating
to an Indemnifiable Claim, including dismissal without prejudice, Indemnitee
shall be indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Claims.

8.                                       BURDEN
OF PROOF.  In connection with any
determination by the Reviewing Party or a court as to whether Indemnitee is
entitled to be indemnified hereunder, the burden of proof shall be on the
Company to establish that Indemnitee is not so entitled.

9.                                       NO
PRESUMPTION.  For purposes of this
Agreement, the termination of any claim, action, suit or proceeding, whether
civil or criminal, by judgment, order, settlement (whether with or without
court approval) or conviction, or upon a plea of nolo contendere, or its equivalent,
shall not create a presumption that Indemnitee did not meet any particular
standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable law.

10.                                 NONEXCLUSIVITY,
ETC.  The rights of Indemnitee hereunder
shall be in addition to any other rights Indemnitee may have under the Articles
of Incorporation or Bylaws of the Company, applicable law, any other agreement,
or otherwise.  To the extent that a
change in the law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the Bylaws
of the Company and this Agreement, it is the intent of the parties hereto that
Indemnitee shall enjoy by this Agreement the greater benefits so afforded by
such change.

11.                                 LIABILITY
INSURANCE.  To the extent the Company
maintains an insurance policy or policies providing directors’ and officers’
liability insurance, Indemnitee shall be covered by such policy or policies, in
accordance with its or their terms, to the maximum extent of the coverage
available for any director or officer of the Company.

12.                                 AMENDMENTS,
ETC.  No supplement, modification or
amendment of this Agreement shall be binding unless executed in writing by both
of the parties hereto.  No waiver of any
of the provisions of this Agreement shall be effective unless in writing and no
written waiver shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver.

13.                                 SUBROGATION.  In the event of payment under this Agreement,
the Company shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee, who shall execute all papers required and
shall do everything that may be necessary to secure such rights, including the
execution of such documents necessary to enable the Company effectively to
bring suit to enforce such rights. 
Indemnitee shall not be obligated to incur any expense in connection
with, and Indemnitee shall be entitled to reasonable compensation for any time
devoted by Indemnitee to, securing such rights of recovery for the Company.

 7
 

14.                                 NO
DUPLICATION OF PAYMENTS.  The Company
shall not be liable under this Agreement to make any payment in connection with
any Claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, the Articles of
Incorporation or Bylaws of the Company, or otherwise) of the amounts otherwise
indemnifiable hereunder.

15.                                 SPECIFIC
PERFORMANCE.  The parties recognize that
if any provision of this Agreement is violated by the Company, Indemnitee may
be without an adequate remedy at law. 
Accordingly, in the event of any such violation, the Indemnitee shall be
entitled, if Indemnitee so elects, to institute proceedings, either at law or
in equity, to obtain damages, enforce specific performance, enjoin such
violation, obtain any other relief, or any combination of the foregoing.

16.                                 BINDING
EFFECT, ETC.  This Agreement shall be
binding upon, inure to the benefit of, and be enforceable by the parties hereto
and their respective successors (including any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
business or assets, or both, of the Company), assigns, spouses, heirs, and
personal and legal representatives.  This
Agreement shall continue in effect regardless of whether Indemnitee continues
to serve as a Fiduciary of the Company or a Company-Related Enterprise.

17.                                 SEVERABILITY.  The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.

18.                                 GOVERNING
LAW.  This Agreement shall be governed
by, and be construed and enforced in accordance with, the laws of the State of
Kansas applicable to contracts made and to be performed in such state, without
giving effect to the principles of conflicts of laws.

IN WITNESS WHEREOF, the Company and Indemnitee have
executed this Agreement as of the date first above written.

 

	
   

  	
  MGP INGREDIENTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  ,

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  [Name
  of Indemnitee]

  

 

 8

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