THIRTY-NINTH ASSIGNMENT OF AVAILABILITY AGREEMENT, CONSENT AND AGREEMENT
This Thirty-ninth Assignment of Availability Agreement, Consent and Agreement (hereinafter referred to as this “Assignment”), dated June 15, 2021, is made by and among System Energy Resources, Inc. (the “Company”), Entergy Arkansas, LLC, (“Entergy Arkansas”) (successor in interest to Arkansas Power & Light Company and ArkansasMissouri Power Company), Entergy Louisiana, LLC (“Entergy Louisiana”) (successor in interest to Louisiana Power & Light Company), Entergy Mississippi, LLC (“Entergy Mississippi”) (successor in interest to Mississippi Power & Light Company), and Entergy New Orleans, LLC (“Entergy New Orleans”) (successor in interest to New Orleans Public Service Inc.) (hereinafter Entergy Arkansas, Entergy Louisiana, Entergy Mississippi and Entergy New Orleans are called individually a “System Operating Company” and collectively, the “System Operating Companies”), The Bank of New York Mellon (successor to United States Trust Company of New York), as trustee (the “Mortgage Trustee”), and The Bank of New York Mellon, as Trustee under the Trust Indenture referred to below (the “Trustee”).
WHEREAS:
A. Entergy Corporation (successor to Middle South Utilities, Inc.) (“Entergy”) owns, either directly or indirectly, all of the outstanding common securities of the Company and each of the System Operating Companies, and the Company has a 90% undivided ownership and leasehold interest in Unit No. 1 of the Grand Gulf Steam Electric Generating Station (nuclear) project (the “Project”) (more fully described in the “Restated Mortgage” hereinafter referred to).
B. Prior hereto, (i) the Company, the System Operating Companies and the Mortgage Trustee, as trustee for the holders of $250,000,000 aggregate principal amount of the Company’s First Mortgage Bonds, 4.10% Series due 2023 (the “Twenty-second Series Bonds”) issued under a Mortgage and Deed of Trust dated as of June 15, 1977, between the Company and the Trustee, as amended, restated and supplemented by a Twenty-fourth Supplemental Indenture dated as of September 1, 2012 (the “Twenty-fourth Supplemental Indenture”) (said Mortgage and Deed of Trust as so amended, restated and supplemented by the Twenty-fourth Supplemental Indenture, the “Original Restated Mortgage”), entered into a Thirty-seventh Assignment of Availability Agreement, Consent and Agreement dated as of September 1, 2012, which was subsequently amended by the Amendment to the Thirty-seventh Assignment of Availability Agreement, Consent and Agreement, dated as of September 18, 2015 (as so amended, “Thirty-seventh Assignment of Availability Agreement) (substantially in the form of this Agreement), to secure the Twenty-second Series Bonds; and (ii) the Company, the System Operating Companies and the Mortgage Trustee, as trustee for the holders of $200,000,000 aggregate principal amount of the Company’s First Mortgage Bonds, 2.14% Series due December 9, 2025 (the “Twenty-third Series Bonds”) issued under the Original Restated Mortgage as supplemented by Officer’s Certificate No. 1-B-1 dated as of December 7, 2020 (“Officer’s Certificate No. 1-B-1”) (as so supplemented by Officer’s Certificate No. 1-B-1, and as the same may from time to time hereafter be amended and supplemented in accordance with its terms, hereinafter referred to as the “Restated Mortgage”), entered into a Thirty-eighth Assignment of Availability Agreement, Consent and Agreement dated as of December 9, 2020 (“Thirty-eighth Assignment of Availability Agreement) (also substantially in the form of this Agreement), to secure the Twenty-third Series Bonds.
C. The Original Availability Agreement has been amended by the First Amendment thereto dated as of June 30, 1977, the Second Amendment thereto dated June 15, 1981, the Third Amendment thereto dated June 28, 1984, and the Fourth Amendment thereto
dated as of June 1, 1989 (the Original Availability Agreement, as so amended and as it may be further amended and supplemented, is hereinafter referred to as the “Availability Agreement”).
D. Unit No. 1 and Unit No. 2 of the Project have been designated by the Company and the System Operating Companies as being subject to the Availability Agreement and as being System Energy Generating Units (as defined in the Availability Agreement) thereunder.
E. The Company seeks to refinance part of the capital costs related to the Project heretofore financed and, to that end, the Company has entered into a Loan Agreement, dated as of June 1, 2021 (the “Loan Agreement”) between the Mississippi Business Finance Corporation (the “Issuer”) and the Company, pursuant to which the Issuer proposes to refinance a portion of the cost of acquiring, improving and installing certain air and water pollution control facilities and sewage and waste disposal facilities relating to the Project by the issuance, pursuant to a trust indenture dated as of June 1, 2021 (the “Trust Indenture”) naming The Bank of New York Mellon as Trustee of $83,695,000 aggregate principal amount of the Issuer’s Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021 (the “Bonds”) to various purchasers; and to evidence and secure, in part, the obligation of the Company concerning the payment of the principal, premium and interest on the Bonds, the Company has provided for the issuance of $85,103,000 aggregate principal amount of First Mortgage Bonds, MBFC Series due 2044 (the “Twenty-fourth Series Bonds”) which are equal to the principal amount of the Bonds and seventeen-twenty-fourths (17/24) of the amount of the stated annual interest rate requirement of the Bonds. The Twenty-fourth Series Bonds will mature upon the stated maturity date of the Bonds. The Twenty-fourth Series Bonds are to be issued under and secured pursuant to the Restated Mortgage, including Officer’s Certificate No. 2-B-2 dated as of June 8, 2021 (“Officer’s Certificate No. 2-B-2”), entered pursuant thereto. The Twenty-fourth Series Bonds will be registered in the name of the Trustee as the sole holder of the Twenty-fourth Series Bonds.
F. The Company, by this instrument, wishes to (i) provide for the assignment by the Company to the Trustee for the benefit of the holders of the Bonds and the Mortgage Trustee for the benefit of the Trustee as sole holder of the Twenty-fourth Series Bonds, of certain of the Company’s rights under the Availability Agreement, and (ii) create enforceable rights hereunder in the Trustee and the Mortgage Trustee, all as hereunder set forth.
G. The System Operating Companies are willing to, and by this instrument do, supplement their undertakings under the Availability Agreement in the same manner as in the Assignments of Availability Agreement.
H. All things necessary to make this Assignment the valid, legally binding and enforceable obligation of each of the parties hereto have been done and performed and the execution and performance hereof in all respects have been authorized and approved by all corporate and shareholder action necessary on the part of each thereof.
NOW, THEREFORE, in consideration of the terms and agreements hereinafter set forth, the parties agree with each other as follows:
ARTICLE I.
Security Assignment and Agreement
1.1 Assignment and Creation of Security Interest. As security for (i) the Bonds, (ii) upon the acceleration of the Bonds following an occurrence of an Event of Default, as defined in the Trust Indenture, the Company’s obligation to redeem the Twenty-fourth Series
Bonds, and (iii) the due and punctual payment of any other amounts which may become payable by the Company in connection with the Twenty-fourth Series Bonds and the Bonds, including but not limited to, all fees and costs, expenses and other amounts that may become payable by the Company under the Restated Mortgage and that are a charge on the trust estate thereunder, which is superior to the charge thereon for the benefit of the Twenty-fourth Series Bonds, together in each case, with all costs of collection thereof (all such amounts referred to in the foregoing clauses (i), (ii) and (iii) being hereinafter collectively referred to as “Obligations Secured Hereby”), the Company hereby assigns to the Trustee and the Mortgage Trustee, and creates a security interest in favor of the Trustee, for the benefit of the holders of the Bonds, and the Mortgage Trustee, for the benefit of the Trustee as sole holder of the Twenty-fourth Series Bonds, in all of the Company’s rights to receive all moneys paid or to be paid to the Company pursuant to Section 4 of the Availability Agreement or advances pursuant to Section 2.2(b) hereof, but only to the extent that such payments or advances are attributable to payments or advances with respect to Unit No. 1 or Unit No. 2, and all other claims, rights (but not obligations or duties), powers, privileges, interests and remedies of the Company, whether arising under the Availability Agreement or this Assignment or by statute or in law or in equity or otherwise, resulting from any failure by any System Operating Company to perform its obligations under the Availability Agreement or this Assignment, but only to the extent that such claims, rights, powers, privileges, interests and remedies relate to Unit No. 1 and Unit No. 2, all to the extent, but only to the extent, required for the payment when due and payable of Obligations Secured Hereby, together in each case with full power and authority, in the name of the Trustee, the Mortgage Trustee, or the Company as assignor, or otherwise, to demand payment of, enforce, collect, receive and accept receipt for any and all of the foregoing (the rights, claims, powers, privileges, interests and remedies referred to above being hereinafter sometimes called the “Collateral”).
1.2 Other Agreements.
(a) The Company has not and will not assign the rights assigned in Section 1.1 as security for any indebtedness other than the Obligations Secured Hereby, except as recited and provided in paragraph (b) of this Section 1.2.
(b) The Company has secured its Indebtedness for Borrowed Money (as defined below) represented by the Twenty-second Series Bonds and the Twenty-third Series Bonds, as referred to in Whereas Clause B hereof by the Thirty-seventh Assignment of Availability Agreement and the Thirty-eighth Assignment of Availability Agreement, respectively, and shall be entitled to secure the interest and premium, if any, on, and the principal of, other Indebtedness for Borrowed Money of the Company issued by the Company to any person (except Entergy or any affiliate of Entergy) to finance the cost of the Project (including, without limitation, Indebtedness for Borrowed Money outstanding under the Restated Mortgage) or to refund (including any successive refundings) any such Indebtedness for Borrowed Money (including such Indebtedness for Borrowed Money now outstanding) issued for such purpose, the incurrence of which Indebtedness for Borrowed Money is at the time permitted by the Restated Mortgage (herein, together with such Indebtedness for Borrowed Money now outstanding, called “Additional Indebtedness”), by entering into an assignment of availability agreement, consent and agreement including, without limitation, the Thirty-seventh Assignment of Availability Agreement and the Thirty-eighth Assignment of Availability Agreement (each being hereinafter called an “Additional Assignment”) with the holders of such Additional Indebtedness or representatives of or trustees for such holders, or both, as the case may be (herein called an “Additional Assignee”). Each Additional Assignment hereafter entered into shall be substantially in the form of this Assignment, except that there shall be substituted in such Additional Assignment appropriate references to the Additional Indebtedness secured thereby, the applicable Additional Assignee and the agreement or instrument under which such Additional Indebtedness is issued in lieu of the references herein to the Twenty-fourth Series
Bonds, the Mortgage Trustee, the Trustee and the Restated Mortgage, respectively, and such Additional Assignment may contain such other provisions as are not inconsistent with this Assignment and do not adversely affect the rights hereunder of the holders of the Trustee or the Mortgage Trustee.
(c) Notwithstanding any provision of this Assignment to the contrary, or any priority in time of creation, attachment or perfection of a security interest, pledge or lien by the Trustee or the Mortgage Trustee, or any provision of or filing or recording under the Uniform Commercial Code or any other applicable law of any jurisdiction, the Trustee and the Mortgage Trustee agree that the claims of the Trustee and the Mortgage Trustee hereunder with respect to the Trustee and any security interest, pledge or lien in favor of the Trustee and the Mortgage Trustee now or hereafter existing in and to the Collateral shall rank pari passu with the claims of each Additional Assignee under the corresponding provisions of the Additional Assignment to which it is a party with respect to the Availability Agreement and any security interest, pledge or lien in favor of such Additional Assignee under such Additional Assignment now or hereafter existing in and to the Collateral, irrespective of the time or times at which prior, concurrent or subsequent Additional Assignments are entered into in accordance with Section 1.2(b) hereof.
1.3 Payments to the Trustee and the Mortgage Trustee. The Company agrees that, if and whenever it shall make a demand to a System Operating Company for any payment pursuant to Section 4 of the Availability Agreement or advances pursuant to Section 2.2(b) hereof with respect to Unit No. 1 or Unit No. 2, it will separately identify the respective portions of such payment or advance, if any, required for (i) the payment of Obligations Secured Hereby and (ii) the payment of any other amounts then due and payable in respect of Additional Indebtedness and instruct such System Operating Company (subject to the provisions of Section 1.4 hereof) to pay or cause to be paid the amount so identified as required for the payment of Obligations Secured Hereby directly to the Trustee or, if all amounts owed under the Loan Agreement shall have been paid, to the Mortgage Trustee. Any payments made by any System Operating Company pursuant to Section 4 of the Availability Agreement or advances pursuant to Section 2.2(b) hereof with respect to Unit No. 1 or Unit No. 2 shall, to the extent necessary to satisfy in full the assignment set forth in Section 1.1 of this Assignment and the corresponding assignments set forth in the Additional Assignments, be made pro rata in proportion to the respective amounts secured by, and then due and owing under, such assignments.
1.4 Payments to the Company. Notwithstanding the provisions of Sections 1.1 and 1.3, unless and until the Trustee or the Mortgage Trustee shall have given written notice to the System Operating Companies of the occurrence and continuance of any Event of Default (as defined in the Trust Indenture) or any Event of Default (as defined in the Restated Mortgage), all moneys paid or to be paid to the Company pursuant to Section 4 of the Availability Agreement or advanced pursuant to Section 2.2(b) hereof with respect to Unit No. 1 and Unit No. 2 shall be paid or advanced directly to the Company, and the Company need not separately identify the respective portions of payments or advances as provided in Section 1.3 hereof; provided that notice as to the amount of any such payments or advances shall be given by the Company to the Trustee and the Mortgage Trustee simultaneously with the demand by the Company for any such payments or advances. If the Trustee or the Mortgage Trustee shall have duly notified the System Operating Companies of the occurrence of any such Event of Default, such payments or advances shall be made in the manner and in the amounts specified in Section 1.3 hereof until the Trustee or the Mortgage Trustee shall by further notice to the System Operating Companies give permission that all such payments or advances may be made again to the Company, such permission being subject to revocation by a subsequent notice pursuant to the first sentence of this Section 1.4. The Trustee or the Mortgage Trustee shall give such permission if no such Event of Default continues to exist.
1.5 Definitions. For the purposes of this Assignment, the following terms shall have the following meanings:
(a) the term “Indebtedness for Borrowed Money” shall mean the principal amount of all indebtedness for borrowed money, secured or unsecured, of the Company then outstanding and shall include, without limitation, the principal amount of all bonds issued by a governmental or industrial development agency or authority in connection with an industrial development revenue bond financing of pollution control facilities constituting part of the Project; and
(b) the term “Subordinated Indebtedness of the Company” shall mean indebtedness marked on the books of the Company as subordinated and junior in right of payment to the Obligations Secured Hereby (as defined in Section 1.1 hereof) to the extent and in the manner set forth below:
(i) if there shall occur an Event of Default (used herein as defined in either or both of the Trust Indenture or the Restated Mortgage), then so long as such Event of Default shall be continuing and shall not have been cured or waived, or unless and until all the Obligations Secured Hereby shall have been paid in full in money or money’s worth at the time of receipt, no payment of principal, premium, if any, or interest shall be made upon Subordinated Indebtedness of the Company; and
(ii) in the event of any insolvency, bankruptcy, liquidation, reorganization or other similar proceedings, or any receivership proceedings in connection therewith, relative to the Company or its creditors or its property, and in the event of any proceedings for voluntary liquidation, dissolution or other winding up of the Company, whether or not involving insolvency or bankruptcy proceedings, then the Obligations Secured Hereby shall first be paid in full in money or money’s worth at the time of receipt, or payment thereof shall have been provided for, before any payment on account of principal, premium, if any, or interest is made upon Subordinated Indebtedness of the Company.
ARTICLE II.
Consent to Assignment by the System Operating
Companies and Other Agreements
2.1 Consent to Assignment by the System Operating Companies.
(a) Each System Operating Company hereby consents to the assignment under Article I and agrees to make payments or advances to the Trustee and the Mortgage Trustee in the amounts and in the manner specified in Section 1.3 at the Trustee’s or the Mortgage Trustee’s address as set forth in Section 6.1 hereof.
(b) Subject to the provisions of Section 4 of the Availability Agreement and Section 2.2(g) hereof, each System Operating Company agrees that all payments or advances made to the Trustee, to the Mortgage Trustee or to the Company as contemplated by Sections 1.3 and 1.4 hereof shall be final as between such System Operating Company and the Trustee, the Mortgage Trustee or the Company, as the case may be, and that it will not seek to recover from the Trustee or the Mortgage Trustee for any reason whatsoever any moneys paid or advanced to the Trustee or the Mortgage Trustee by virtue of this Assignment, but the finality of any such payment or advance shall not prevent the recovery of any overpayments or mistaken payments or excess advances or mistaken advances that may be made by such System Operating Company unless an Event of Default under the Trust Indenture or an Event of Default under the Restated Mortgage has occurred and is continuing, in which case any such overpayment or mistaken
payment or excess advances or mistaken advances shall not be recoverable but shall constitute Subordinated Indebtedness of the Company to such System Operating Company.
2.2 Other Agreements. Anything in the Availability Agreement to the contrary notwithstanding, it is hereby agreed as follows:
(a) Regardless of whether any person or persons (other than the System Operating Companies) shall become a Party or Parties (as such terms are defined in the Availability Agreement) to the Availability Agreement, the System Operating Companies shall at all times be obligated to make the payments required pursuant to Section 4 of the Availability Agreement and to make advances pursuant to Section 2.2(b) hereof with respect to Unit No. 1 and Unit No. 2 to the same extent as if the System Operating Companies were the only Parties to the Availability Agreement, except to the extent and only to the extent that such payments or advances are actually made by such person or persons. In the event that any such person shall become a Party to the Availability Agreement, the Company and the System Operating Companies shall cause such person, at the time when such person becomes a Party to the Availability Agreement, to consent by written instrument to the terms and provisions of this Assignment, and thereupon such person shall be bound by all of the terms and provisions of this Assignment (other than the provisions of the preceding sentence) to the same extent as if named a System Operating Company herein. A copy of such written instrument, in form and substance satisfactory to the Trustee and the Mortgage Trustee, shall promptly be delivered to the Trustee and the Mortgage Trustee together with an opinion of counsel to the effect that such instrument complies with the requirements hereof and constitutes a valid, legally binding obligation of such person.
(b) In the event and to the extent that any action by any governmental regulatory authority, including, without limitation, the Federal Energy Regulatory Commission or any successor thereto, shall have the effect of prohibiting the System Operating Companies from making any payments that would otherwise be required pursuant to Section 4 of the Availability Agreement (as supplemented hereby) with respect to Unit No. 1 and Unit No. 2, the System Operating Companies shall make advances to the Company at the same time, and in the same amounts as such prohibited payments and all such advances shall constitute Subordinated Indebtedness of the Company.
(c) Each System Operating Company agrees that (i) all Indebtedness for Borrowed Money of the Company to such System Operating Company and all amounts paid by such System Operating Company pursuant to Section 4 of the Availability Agreement or advanced pursuant to Section 2.2(b) hereof shall constitute Subordinated Indebtedness of the Company and (ii) no such Subordinated Indebtedness of the Company shall be transferred or assigned (including by way of security) to any person (other than to a successor of such System Operating Company by way of merger, consolidation or the acquisition by such person of all or substantially all of such System Operating Company’s assets). The Company agrees that it shall duly record all Subordinated Indebtedness of the Company as such on its books.
(d) No authorization by any governmental regulatory authority being required other than, with respect to the payments pursuant to the provisions of Section 4 of the Availability Agreement, appropriate orders, or the taking of other action, by the Federal Energy Regulatory Commission or any successor thereto as to specific terms and provisions under which power and energy associated therewith available at the Project shall be made available by the Company to the System Operating Companies and pursuant to which the System Operating Companies shall agree to pay the Company for the right to receive such power and the energy associated therewith, each System Operating Company agrees that its duty to make the payments to the Company pursuant to the provisions of Section 4 of the Availability Agreement and the advances pursuant to Section 2.2(b) hereof with respect to Unit No. 1 and Unit No. 2 shall be
absolute and unconditional, (a) whether or not such System Operating Company shall have received all authorizations of governmental regulatory authorities necessary at the time to permit such System Operating Company to perform its other duties and obligations hereunder, under the Availability Agreement or under the System Agreement (as defined in the Availability Agreement), (b) whether or not the Company shall have received all authorizations of governmental regulatory authorities necessary at the time to permit the Company to perform its duties and obligations hereunder, under the Availability Agreement or under the System Agreement, (c) whether or not any authorizations referred to in the foregoing clauses (a) and (b) continue, at the time, in effect, (d) whether or not, at any time in question, the Company shall have performed its duties and obligations hereunder, under the Availability Agreement or under the System Agreement, (e) whether or not the System Agreement shall, from time to time, be amended, modified or supplemented or shall be canceled or terminated or such System Operating Company shall have withdrawn therefrom, (f) whether or not the Project shall be maintained in commercial operation, energy from the Project is being produced or delivered or is available (including, without limitation, delivery or availability to such System Operating Company), an abandonment of the Project shall have occurred or the Project shall be in whole or in part destroyed or taken, for any reason whatsoever, (g) whether or not the Company shall be solvent, (h) whether or not the Company or such System Operating Company shall continue to be subsidiary companies of Entergy, (i) whether or not, at any time in question, any event of force majeure has occurred, and (j) whether or not, at any time in question, any other circumstance, happening, condition or event whatsoever, whether or not similar to any of the foregoing, has arisen, occurred or presented itself.
(e) In the event that Entergy shall cease to own directly or indirectly a majority of the common securities of any System Operating Company, the obligations of such System Operating Company hereunder and under the Availability Agreement shall not be increased by an amendment to or modification of the terms and provisions of the Trust Indenture, the Bonds, the Restated Mortgage, including Officer’s Certificate No. 2-B-2, or the Twenty-fourth Series Bonds unless such System Operating Company shall have consented in writing to such amendment or modification.
(f) The obligations of each System Operating Company under Section 4 of the Availability Agreement and Section 2.2(b) hereof to make the payments or advances specified therein or herein with respect to Unit No. 1 and Unit No. 2 to the Company shall not be subject to any abatement, reduction, limitation, impairment, termination, setoff, defense, counterclaim or recoupment whatsoever or any right to any thereof (including, but not limited to, abatements, reductions, limitations, impairments, terminations, setoffs, defenses, counterclaims and recoupments for or on account of any past, present or future indebtedness of the Company to such System Operating Company or any claim by such System Operating Company against the Company, whether or not arising hereunder, under the Availability Agreement or under the System Agreement and whether or not arising out of any action or nonaction on the part of the Company or the Trustee or the Mortgage Trustee, including any disposition of the Project or any part thereof pursuant to the Trust Indenture or the Restated Mortgage, requirements of governmental authorities, actions of judicial receivers or trustees or otherwise and whether or not arising from willful or negligent acts or omissions). The foregoing, however, shall not, subject to the provisions of paragraph (c) of this Section 2.2, affect in any other way any rights and remedies of such System Operating Company with respect to any amounts owed to such System Operating Company by the Company or any such claim by such System Operating Company against the Company. The obligations and liabilities of each System Operating Company hereunder or under the Availability Agreement shall not be released, discharged or in any way affected by any reorganization, arrangement, compromise, composition or plan affecting the Company or any change, waiver, extension, indulgence or other action or omission in respect of any indebtedness or obligation of the Company or such System Operating Company, whether or not the Company or such System Operating Company shall have had any notice or knowledge of
any of the foregoing. Neither failure nor delay by the Company or the Trustee or the Mortgage Trustee to exercise any right or remedy provided herein or by statute or at law or in equity shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or remedy preclude any other or further exercise thereof, or the exercise of any other right or remedy. Each System Operating Company also hereby irrevocably waives, to the extent that it may do so under applicable law, any defense based on the adequacy of a remedy at law that may be asserted as a bar to the remedy of specific performance in any action brought against such System Operating Company for specific performance of this Assignment or the Availability Agreement by the Company, by the Trustee, by the Mortgage Trustee, or for their benefit by a receiver or trustee appointed for the Company or in respect of all or a substantial part of the Company’s assets under the bankruptcy or insolvency law of any jurisdiction to which the Company is or its assets are subject. Anything in this Section 2.2(f) to the contrary notwithstanding, no System Operating Company shall be precluded from asserting as a defense against any claim made against such System Operating Company upon any of its obligations hereunder and under the Availability Agreement that it has fully performed such obligations in accordance with the terms of this Assignment and the Availability Agreement.
(g) Each System Operating Company shall, subject to the provisions of Section 2.2(c) hereof, be proportionately subrogated to all rights of the Trustee and the Mortgage Trustee against the Company in respect of any amounts paid or advanced by such System Operating Company pursuant to the provisions of this Assignment and the Availability Agreement and applied to the payment of the Obligations Secured Hereby. The Trustee and the Mortgage Trustee agree that it will not deal with the Company, or any security for the Twenty-fourth Series Bonds in such a manner as to prejudice such rights of any System Operating Company.
ARTICLE III.
Term
This Assignment shall remain in full force and effect until, and shall terminate and be of no further force and effect after, all Obligations Secured Hereby shall have been paid in full in money or money’s worth at the time of receipt; provided that this Assignment shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Obligations Secured Hereby is rescinded or must otherwise be returned by the Trustee upon the insolvency, bankruptcy or reorganization of the Company, any System Operating Company or otherwise, all as though such payment had not been made. It is agreed that all the covenants and undertakings on the part of the System Operating Companies and the Company set forth in this Assignment are exclusively for the benefit of, and may be enforced only by, the Trustee, the Mortgage Trustee, or for their benefit by a receiver or trustee for the Company or in respect of all or a substantial part of its assets under the bankruptcy or insolvency law of any jurisdiction to which the Company is or its assets are subject.
ARTICLE IV.
Assignment
Neither this Assignment nor the Availability Agreement nor any interest herein or therein may be assigned, transferred or encumbered by any of the parties hereto or thereto, except transfer or assignment by the Trustee and the Mortgage Trustees to their respective successors in accordance with Article XI of the Trust Indenture and Article Ten of the Restated Mortgage, respectively, except as otherwise provided in Article I hereof and except that
(i) in the event that any System Operating Company shall consolidate with or merge with or into another corporation or shall transfer to another corporation or other person all
or substantially all of its assets, this Assignment and the Availability Agreement shall be transferred by such System Operating Company to and shall be binding upon the corporation resulting from such consolidation or merger or the corporation or other person to which such transfer is made and, as a condition to such consolidation, merger or other transfer, such corporation or other person shall deliver to the Company, the Trustee and the Mortgage Trustee a written assumption, in form and substance satisfactory to the Trustee and the Mortgage Trustee, of such System Operating Company’s obligations and liabilities under this Assignment and the Availability Agreement and an opinion of counsel to the effect that such instrument of transfer complies with the requirements hereof and thereof and constitutes a valid, legally binding and enforceable obligation of such corporation or other person; and
(ii) in the event that the Company shall consolidate with or merge with or into another corporation or shall transfer to another corporation or other person all or substantially all of its assets, this Assignment and the Availability Agreement shall be transferred by the Company to and shall be binding upon the corporation resulting from such consolidation or merger or the corporation or other person to which such transfer is made and, as a condition to such consolidation, merger or other transfer, such corporation or other person shall deliver to the Trustee and the Mortgage Trustee a written assumption, in form and substance satisfactory to the Trustee and the Mortgage Trustee, of the Company’s obligations and liabilities under this Assignment and the Availability Agreement and an opinion of counsel to the effect that such instrument of transfer complies with the requirements hereof and thereof and constitutes a valid, legally binding and enforceable obligation of such corporation or other person.
ARTICLE V.
Amendments
5.1 Restrictions on Amendments. Neither this Assignment nor the Availability Agreement may be amended, waived, modified, discharged or otherwise changed orally. This Assignment and the Availability Agreement may be amended, waived, modified, discharged or otherwise changed only by a written instrument that has been signed by all the parties hereto, in the case of this Assignment, or by the persons specified in Section 11 of the Availability Agreement, in the case of the Availability Agreement, and that has been approved by the Trustee and the Mortgage Trustee and that has been approved by the holders of a majority in aggregate principal amount of the Bonds outstanding (as defined in the Trust Indenture) at the time of such consent (provided, however, that if the holders of a majority in aggregate principal amount of the Bonds outstanding do not vote, then the Trustee shall act in accordance with what the Trustee reasonably believes will be the vote or consent of the holders of all other first mortgage bonds then outstanding under the Restated Mortgage) or that does not materially adversely affect the rights of the Trustee, the Mortgage Trustee or the holders of the Bonds or that is necessary in order to qualify the Restated Mortgage under the Trust Indenture Act of 1939, as contemplated by Sections 1301 and 1302 of the Restated Mortgage; provided, however, that (i) without the written consent of the holder of all the Bonds affected thereby, no amendment, waiver, modification, discharge or other change in or to this Assignment or the Availability Agreement shall be made that shall change the terms of this Section 5.1 and (ii) no such amendment, waiver, modification, discharge or other change shall be made that shall modify, (a) without the written consent of the Trustee, the rights, duties or immunities or the Trustee, or (b) without the written consent of the Mortgage Trustee, the rights, duties or immunities of the Mortgage Trustee. The
Mortgage Trustee shall, at the request of the Trustee, become a party to any instrument amending, waiving, modifying, discharging or otherwise changing this Agreement.
5.2 The Trustee's and the Mortgage Trustee’s Execution. The Trustee and the Mortgage Trustee shall, at the request of the Company, execute any instrument amending, waiving, modifying, discharging or otherwise changing this Assignment, or any consent to the execution of any instrument amending, waiving, modifying, discharging or otherwise changing the Availability Agreement (a) as to which the Trustee and the Mortgage Trustee shall have received an opinion of counsel to the effect that such instrument has been duly authorized by each person executing the same and is permitted by the provisions of Section 5.1 hereof and that this Assignment, or the Availability Agreement, as the case may be, as amended, waived, modified, discharged or otherwise changed by such instrument, constitutes valid, legally binding and enforceable obligations of the Company and each of the System Operating Companies, and (b) that shall have been executed by the Company and each of the System Operating Companies. The Trustee and the Mortgage Trustee shall be fully protected in relying upon the aforesaid opinion.
ARTICLE VI.
Notices
6.1 Notices, etc., in Writing. All notices, consents, requests and other documents authorized or permitted to be given pursuant to this Assignment shall be given in writing and either personally served on the party to whom (or an officer of a corporate party) it is given or mailed by registered or certified firstclass mail, postage prepaid, addressed as follows:
If to System Energy Resources, Inc., to:
639 Loyola Avenue
New Orleans, Louisiana 70113
Attention: Treasurer
If to Entergy Arkansas, LLC, to:
639 Loyola Avenue
New Orleans, Louisiana 70113
Attention: Treasurer
If to Entergy Louisiana, LLC, to:
639 Loyola Avenue
New Orleans, Louisiana 70113
Attention: Treasurer
If to Entergy Mississippi, LLC, to:
639 Loyola Avenue
New Orleans, Louisiana 70113
Attention: Treasurer
If to Entergy New Orleans, LLC, to:
639 Loyola Avenue
New Orleans, Louisiana 70113
Attention: Treasurer
If to the Trustee, to:
The Bank of New York Mellon Trust Company, N.A.
4655 Salisbury Road, Suite 300
Jacksonville, Florida 32256
Attention: Cynthia Moore, Vice President
If to the Mortgage Trustee, to:
The Bank of New York Mellon Trust Company, N.A.
4655 Salisbury Road, Suite 300
Jacksonville, Florida 32256
Attention: Cynthia Moore, Vice President
with copies to each other party.
6.2 Delivery, etc. Notices, consents, requests and other documents shall be deemed given or served or submitted when delivered or, if mailed as provided in Section 6.1 hereof, on the third day after the day of mailing. A party may change its address for the receipt of notices, consents, requests and other documents at any time by giving notice thereof to the other parties. Any notice, consent, request or other document given hereunder may be signed on behalf of any party by any duly authorized representative of that party.
The Trustee and the Mortgage Trustee agree to accept and act upon instructions or directions pursuant to this Assignment sent by unsecured e-mail, pdf, facsimile transmission or other similar unsecured electronic methods. If any party elects to give the Trustee or the Mortgage Trustee e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee or the Mortgage Trustee, in either case, in its discretion, elects to act upon such instructions, in the absence of gross negligence or willful misconduct, the Trustee’s or the Mortgage Trustee’s, as applicable, understanding of such instructions shall be deemed controlling. Neither the Trustee nor the Mortgage Trustee shall be liable for any losses, costs or expenses arising directly or indirectly from its respective reliance upon and compliance with such instructions notwithstanding should such instructions conflict or be inconsistent with a subsequent written instruction. Each party agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee and the Mortgage Trustee, including without limitation the risk of either the Trustee or the Mortgage Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties.
ARTICLE VII.
Enforcement
7.1 Trust Indenture and Mortgage Terms and Conditions. The Trustee and the Mortgage Trustee enter into and accept this Assignment upon the terms and conditions set forth in Article XI of the Trust Indenture and Article Ten of the Restated Mortgage, respectively, with the same force and effect as if those terms and conditions were repeated at length herein and made applicable to the Trustee and the Mortgage Trustee in respect of this Assignment and the trusts hereunder and in respect of any action taken, suffered or omitted to be taken by the Trustee or the Mortgage Trustee hereunder. Without limiting the generality of the foregoing, the Trustee and the Mortgage Trustee assume no responsibility as to the validity or enforceability hereof or for the correctness of the recitals of fact contained herein or in the Availability Agreement,
which shall be taken as the statements, representations and warranties of the Company and the System Operating Companies.
7.2 Enforcement Action. At any time the Trustee upon the request of the holder or holders of not less than 25% of matured (whether by stated maturity, acceleration or otherwise) Bonds that have not been paid may proceed, either in its own name and as Trustee or otherwise, to protect and enforce the rights of the Trustee and those of the Company under this Assignment and the Availability Agreement by suit in equity, action at law or other appropriate proceedings, whether for the specific performance of any covenant or agreement contained herein or in the Availability Agreement or otherwise, and whether or not the Company shall have complied with any of the provisions hereof or thereof or proceeded to take any action authorized or permitted under applicable law; provided that the Trustee shall take no such action until 60 days after receipt of such request during which time such default in payment shall not have been cured nor shall an inconsistent direction have been given to the Trustee by a majority of the holders of the unpaid Bonds. Each and every remedy of the Trustee shall, to the extent permitted by law, be cumulative and shall be in addition to any other remedy given hereunder or under the Trust Indenture or now or hereafter existing at law or in equity or by statute. No holder of a Bond shall have any right directly to enforce the security interests granted by this Assignment. The Mortgage Trustee, upon receiving notice from the Trustee that the Trustee does not intend to take the action contemplated by this Section 7.2, may proceed in its own name to protect the Mortgage Trustee’s rights and those of the Company under this Assignment by suit in equity, action at law or other appropriate proceedings, whether for the specific performance of any covenant or agreement contained in this Assignment or otherwise, and whether or not the Company shall have complied with any of the provisions hereof or proceeded to take any action authorized or permitted under applicable law.
7.3 Attorney-in-Fact. The Company hereby constitutes the Trustee and the Mortgage Trustee, with the authority to act without the other, its true and lawful attorney, irrevocably, with full power (in such attorney’s name or otherwise), at any time when an Event of Default under the Trust Indenture or an Event of Default under the Restated Mortgage has occurred and is continuing, to enforce any of the obligations contained herein or in the Availability Agreement or to take any action or institute any proceedings that to the Trustee or the Mortgage Trustee may seem necessary or advisable in the premises.
ARTICLE VIII.
Severability
If any provision or provisions of this Assignment shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
ARTICLE IX.
Governing Law
This Assignment and, so long as this Assignment shall be in effect, the Availability Agreement shall be governed by and construed in accordance with the laws of the State of New York.
ARTICLE X.
Succession
Subject to Article IV hereof, this Assignment and the Availability Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment hereof, or of the Availability Agreement, or of any right to any funds due or to become due under this Assignment or the Availability Agreement shall in any event relieve the Company or any System Operating Company of their respective obligations hereunder.
ARTICLE XI.
Waiver of Jury Trial
EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT, THE AVAILABILITY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
IN WITNESS WHEREOF, the parties hereto have caused this Thirty-ninth Assignment to be duly executed by their respective officers thereunto duly authorized as of the day and year first above written.
ENTERGY ARKANSAS, LLC
ENTERGY LOUISIANA, LLC
ENTERGY MISSISSIPPI, LLC
ENTERGY NEW ORLEANS, LLC
SYSTEM ENERGY RESOURCES, INC.
By: /s/ Kevin J. Marino
Name: Kevin J. Marino
Title: Assistant Treasurer
THE BANK OF NEW YORK MELLON,
as Trustee
By: /s/ Rick Fierro
Name: Rick Fierro
Title: Vice President
THE BANK OF NEW YORK MELLON,
as Mortgage Trustee
By: /s/ Leslie Morales
Name: Leslie Morales
Title: Vice President
Exhibit 4(c)
Trust Indenture
by and between
Mississippi Business Finance Corporation
and
The Bank of New York Mellon,
as Trustee
Dated as of June 1, 2021
$83,695,000
Mississippi Business Finance Corporation
Revenue Refunding Bonds
(System Energy Resources, Inc. Project)
Series 2021
Table of Contents
EXHIBIT A Form of Bond
Trust Indenture
This Trust Indenture dated as of June 1, 2021 (together with any amendments and supplements hereto, this "Indenture") is by and between the Mississippi Business Finance Corporation (as more fully defined in Section 1.1 hereof, the "Issuer"), a public corporation duly created and validly existing pursuant to the constitution and laws of the State of Mississippi (the "State") authorized to exercise the powers conferred by the Act (as defined below), and The Bank of New York Mellon , a New York banking corporation, as trustee (as more fully defined in Section 1.1 hereof, the "Trustee").
W i t n e s s e t h
WHEREAS, the Issuer is authorized by the provisions of Sections 57-10-201 et seq., Mississippi Code of 1972, as amended and supplemented (the "Act"), among other things, to provide financial assistance to businesses in the State by providing loans, guarantees, insurance and other assistance to businesses, thereby encouraging the investment of private capital in businesses in the State, and to finance such assistance to businesses by the issuance of revenue bonds; and
WHEREAS, the Company has requested that the Issuer issue $83,695,000 aggregate principal amount of its Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021 (as more fully defined in Section 1.1 hereof, the "Series 2021 Bonds") for the purpose of currently refunding $83,695,000 in aggregate principal amount of its Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2019 issued in the original principal amount of $134,000,000 (the "Series 2019 Bonds") which refunded its Pollution Control Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 1998 (the "Series 1998 Bonds") issued in the original principal amount of $216,000,000, which Series 1998 Bonds were issued for the purpose of providing funds to refinance the Prior Bonds (as more fully defined in Section 1.1 hereof) issued to finance the cost of acquiring an undivided 90% interest in certain air and water pollution control facilities and sewage and solid waste disposal facilities (the "Facilities") at the Grand Gulf Nuclear Station located in Claiborne County, Mississippi (the "Plant"); and
WHEREAS, concurrently with the issuance of the Series 2021 Bonds hereunder, the Issuer and the Company will enter into the Loan Agreement (as more fully defined in Section 1.1 hereof) pursuant to which the Issuer will loan the proceeds derived from the sale of the Series 2021 Bonds to the Company for the purposes described herein, and the Company will agree to make payments in an amount sufficient to make timely payments of principal of, and premium, if any, and interest on the Series 2021 Bonds and to pay such other amounts as are required by the Loan Agreement; and
WHEREAS, the Issuer is authorized under the provisions of the Act and other constitutional and statutory authority to issue the Series 2021 Bonds for such purposes and the Issuer has determined that it is most advantageous to the Issuer and necessary for it to issue its revenue refunding bonds as hereinafter provided for such purposes; and
WHEREAS, as additional security for its payment obligations under the Loan Agreement in respect of the Series 2021 Bonds, the Company will deliver to the Trustee a series of First Mortgage Bonds and the Thirty-ninth Assignment (each as defined in Section 1.1 of this Indenture) in accordance with Section 5.9 of the Loan Agreement; and
WHEREAS, the fully registered Series 2021 Bonds and the certificate of authentication by the Trustee to be endorsed thereon with respect to the Series 2021 Bonds are to be in substantially the form attached as Exhibit A hereto with all necessary and appropriate variations, omissions and insertions as permitted or required under this Indenture; and
WHEREAS, the Issuer may authorize and issue Additional Bonds (as defined in Section 1.1 of this Indenture) pursuant to Section 4.2 of the Loan Agreement and Section 2.11 of this Indenture; and
WHEREAS, all acts, conditions and things required by the laws of the State to happen, exist and be performed precedent to and in the execution and delivery of this Indenture have happened, exist and have been performed as so required in order to make this Indenture a valid and binding agreement in accordance with its terms; and
WHEREAS, the execution and delivery of this Indenture have been duly authorized by the Issuer and the Trustee; and
WHEREAS, each of the parties hereto represents that it is fully authorized to enter into and perform and fulfill the obligations imposed upon it under this Indenture and the parties are now prepared to execute and deliver this Indenture;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
GRANTING CLAUSES
That the Issuer, in consideration of the premises and the acceptance by the Trustee of the trusts hereby created and of the purchase and acceptance of the Bonds by the holders and owners thereof, and the sum of One Dollar ($1.00), lawful money of the United States of America, to it duly paid by the Trustee, at or before the execution and delivery of these presents, and for other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to secure the payment of the principal of and premium, if any, and interest on the Bonds according to their tenor and effect and to secure the performance and observance by the Issuer of all the covenants expressed or implied herein and in the Bonds, subject to all of the provisions hereof, does hereby grant, bargain, sell, convey, assign and pledge unto the Trustee, and unto its successor or successors in trust, and to them and their assigns forever, for the securing of the performance of the obligations of the Issuer hereinafter set forth:
GRANTING CLAUSE FIRST
All the rights and interest of the Issuer in and to the (i) First Mortgage Bonds delivered by the Company pursuant to Section 5.9 of the Loan Agreement, (ii) Thirty-ninth Assignment, (iii)
Loan Agreement (except for the rights of the Issuer under Sections 5.4, 5.6, 5.7, 5.8 and 8.5 of the Loan Agreement and any rights of the Issuer to receive notices, certificates, requests, requisitions, directions and other communications under the Loan Agreement), and (iv) all Revenues and the proceeds of all thereof, including the right to receive the First Mortgage Bonds.
GRANTING CLAUSE SECOND
All the rights and interest of the Issuer in and to the Bond Fund, and all moneys and investments therein, but subject to the provisions of the Loan Agreement and this Indenture pertaining thereto, including those pertaining to the making of disbursements therefrom.
GRANTING CLAUSE THIRD
All moneys, securities and obligations from time to time held by the Trustee under the terms of this Indenture and any and all real and personal property of every kind and nature from time to time hereafter by delivery or by writing of any kind conveyed, pledged, assigned or transferred, as and for additional security hereunder by the Issuer or by anyone on its behalf or with its 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; except for moneys, securities or obligations deposited with or paid to the Trustee for redemption or payment of Bonds which are deemed to have been paid in accordance with Article IX hereof and funds held pursuant to Section 5.5 hereof, which shall be held by the Trustee in accordance with the provisions of said Article IX or Section 5.5, as the case may be.
TO HAVE AND TO HOLD all of the same with all privileges and appurtenances hereby conveyed and assigned, or agreed or intended so to be, to the Trustee and its successors in said trusts and to them and their assigns forever;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the equal and proportionate benefit and security of all owners of the Bonds issued under and secured by this Indenture without preference, priority or distinction as to lien of any Bonds over any other Bonds, except insofar as any sinking, amortization or other fund, or any terms or conditions of redemption or purchase, established under this Indenture may afford additional benefit or security for the Bonds of any particular series.
PROVIDED, HOWEVER, that if the Issuer shall pay or cause to be paid to the owners of the Bonds the principal of and premium, if any, and interest to become due thereon at the times and in the manner stipulated therein, and if the Issuer shall keep, perform and observe all and singular the covenants and promises in the Bonds and in this Indenture expressed as to be kept, performed and observed by it on its part, all as provided in and subject to the provisions of Article IX hereof, then and in that case these presents and the estate and rights hereby granted, except as otherwise provided in Article IX, shall cease, determine and be void, and thereupon the Trustee shall cancel and discharge the lien of this Indenture and execute and deliver to the Issuer such instruments in writing as shall be requisite to evidence the discharge hereof pursuant to the provisions of said Article IX; otherwise this Indenture to be and remain in full force and effect.
THIS INDENTURE FURTHER WITNESSETH, and it is expressly declared, that all Bonds issued and secured hereunder are to be issued, authenticated and delivered, and the Trust Estate and the other estate and rights hereby granted, are to be dealt with and disposed of, under, upon and subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes as hereinafter expressed, and the Issuer has agreed and covenanted, and 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 1.1 Definitions. In addition to the words and terms elsewhere defined in this Indenture, the following words and terms as used in this Indenture shall have the following meanings:
"Act" shall have the meaning set forth in the first recital of this Indenture.
"Additional Bonds" shall mean Bonds in addition to the Series 2021 Bonds that are issued pursuant to the provisions of Section 2.11 of this Indenture.
"Administration Expenses" shall mean the reasonable and necessary expenses incurred by the Issuer with respect to the Loan Agreement, this Indenture and any transaction or event contemplated by the Loan Agreement or this Indenture including the compensation and reimbursement of expenses and advances payable to the Trustee, any Paying Agent, and the Bond Registrar.
"Authorized Company Representative" shall mean any treasurer, assistant treasurer or vice president of the Company or the person or persons at the time designated to act on behalf of the Company by any one of said officers, such designation in each case, to be evidenced by a certificate furnished to the Issuer and the Trustee containing the specimen signature of such person or persons and signed on behalf of the Company by said officer.
"Authorized Officers" shall have the meaning set forth in Section 14.11 hereof.
"Availability Agreement" shall mean the Availability Agreement dated as of June 21, 1974, as amended from time to time, by and among the Company, Entergy Arkansas, LLC, Entergy Louisiana, LLC, Entergy Mississippi, LLC and Entergy New Orleans, LLC.
"Bond Counsel" shall mean any firm of nationally recognized municipal bond counsel selected by the Company and acceptable to the Issuer and the Trustee.
"Bond Fund" shall mean the fund by that name created and established pursuant to Section 5.1 of this Indenture.
"Bond Registrar" shall mean the registrar of Bonds named herein.
"Bonds" shall mean the Series 2021 Bonds and any Additional Bonds issued by the Issuer pursuant to this Indenture. "Bond" shall mean any one of such Bonds.
"Code" shall mean the Internal Revenue Code of 1986, as amended and supplemented.
"Company" shall mean System Energy Resources, Inc., a corporation organized and existing under the laws of the State of Arkansas, duly qualified to do business in the State, together with any permitted successors or assigns under the Loan Agreement.
"Company Mortgage" shall mean the Company's Mortgage and Deed of Trust, dated as of June 15, 1977, made to The Bank of New York Mellon, as trustee, as amended, restated and supplemented by the Twenty-Fourth Supplemental Indenture dated as of September 1, 2012, and as has been previously, and as may be further, amended or supplemented, including by the officer’s certificate pursuant to which the series of First Mortgage Bonds relating to the Series 2021 Bonds will be issued.
"Company Mortgage Trustee" shall mean the trustee under the Company Mortgage.
"Determination of Taxability" means:
(a) a final determination by any court of competent jurisdiction or a final determination by the Internal Revenue Service to which the Issuer and the Company shall consent or from which no timely appeal shall be taken to the effect that interest on the Series 2021 Bonds is not excludable from the gross income of the owners thereof for federal income tax purposes;
(b) receipt by the Issuer, the Trustee or the Company of written notice that the Internal Revenue Service has issued a "notice of deficiency" or similar notice to any present or former Bondholder assessing a tax in respect of any interest on the Series 2021 Bonds as a result of such interest not being excludable from gross income for federal income tax purposes, provided that such notice has not been withdrawn by the Internal Revenue Service and has not been the subject of a timely petition from such Bondholder (or the Company or the Trustee on behalf of such Bondholder, if allowable) contesting such notice in the United States Tax Court; or
(c) the delivery to the Company, the Trustee and the Issuer of an opinion of Bond Counsel, delivered at the request of the Company, to the effect that (i) interest on the Series 2021 Bonds is not excludable from the gross income of a holder thereof for federal income tax purposes, (ii) redemption of some or all of the Series 2021 Bonds is required under the terms of a settlement or closing agreement with the Internal Revenue Service of an audit of the Series 2021 Bonds or under the terms of a closing agreement with the Internal Revenue Service pursuant to the Voluntary Closing Agreement Program, or any successor to such program, or (iii) redemption of some or all of the Series 2021 Bonds is required in order to effect a remedial action, as described in Treas. Reg. §1.142-2, necessary to protect the tax-exemption of the Series 2021 Bonds.
"DTC" shall mean The Depository Trust Company, New York, New York, and its successors.
"DTC Letter" shall mean the Blanket Issuer Letter of Representations between the Issuer and DTC dated June 15, 1995.
"DTC Participant" shall mean (a) any person for which, from time to time, DTC, or, in the event that a successor Securities Depository to DTC is acting as such under Section 2.13 hereof, such successor Securities Depository, effectuates book-entry transfers and pledges of
securities pursuant to the book-entry system referred to in Section 2.13 hereof or (b) any securities broker or dealer, bank, trust company or other person that clears through or maintains a custodial relationship with the person referred to in clause (a).
"Electronic Means" shall have the meaning set forth in Section 14.11 hereof.
"Event of Default" shall mean any event of default specified in Section 10.1 hereof.
"Facilities" shall mean certain air and water pollution control facilities and sewage and solid waste disposal facilities at the Grand Gulf Nuclear Station located in Claiborne County, Mississippi owned and operated by the Company.
"First Mortgage Bonds" shall mean one or more series of bonds issued and delivered under the Company Mortgage and held by the Trustee pursuant to Section 5.9 of the Loan Agreement.
"Government Securities" shall mean (a) direct or fully guaranteed obligations of the United States of America (including any such securities issued or held in book-entry form on the books of the Department of Treasury of the United States of America), and (b) certificates, depositary receipts or other instruments which evidence a direct ownership interest in obligations described in clause (a) above or in any specific interest or principal payments due in respect thereof; provided, however, that the custodian of such obligations or specific interest or principal payments shall be a bank or trust company organized under the laws of the United States of America or of any state or territory thereof or of the District of Columbia, with a combined capital stock, surplus and undivided profits of at least $50,000,000; and provided, further, that except as may be otherwise required by law, such custodian shall be obligated to pay to the holders of such certificates, depositary receipts or other instruments the full amount received by such custodian in respect of such obligations or specific payments and shall not be permitted to make any deduction therefrom.
"holder" or "bondholder" or "owner of the Bonds" or "Bondholder" shall mean the registered owner of any Bond.
"Instructions" shall have the meaning set forth in Section 14.11 hereof.
"Issuer" shall mean the Mississippi Business Finance Corporation, a public corporation duly created and validly existing pursuant to the constitution and laws of the State, including the Act, or any successor to its rights and obligations under the Loan Agreement and this Indenture.
"Loan Agreement" or "Agreement" shall mean the Loan Agreement dated as of June 1, 2021, by and between the Issuer and the Company, and any amendments and supplements thereto.
"Maturity Date" shall mean June 1, 2044.
"1954 Code" shall mean the Internal Revenue Code of 1954, as amended and supplemented.
"outstanding," when used with reference to the Bonds, shall mean, as of any particular date, all Bonds authenticated and delivered under this Indenture except:
(a) Bonds canceled at or prior to such date or delivered to or acquired by the Trustee at or prior to such date for cancellation;
(b) Bonds deemed to be paid in accordance with Article IX of this Indenture;
(c) Bonds in lieu of or in exchange or substitution for which other Bonds shall have been authenticated and delivered pursuant to this Indenture; and
(d) Bonds registered in the name of the Issuer.
"Paying Agent" shall mean any bank or trust company designated pursuant to this Indenture as the place at which the principal of and premium, if any, and interest on the Bonds of a series are payable, and any successor designated pursuant to this Indenture. With respect to the Series 2021 Bonds, the Trustee is the original Paying Agent.
"Plant" shall mean the Grand Gulf Nuclear Station located in Claiborne County, Mississippi.
"Prior Bonds" shall mean the $49,500,000 Claiborne County, Mississippi 9 ½% Pollution Control Revenue Bonds (Middle South Energy, Inc. Project) Series A and the $206,000,000 Claiborne County, Mississippi 9 ⅞% Pollution Control Revenue Bonds (Middle South Energy, Inc. Project) Series C.
"Record Date" shall mean, with respect to any interest payment date of the Bonds occurring on the first day of any month, the fifteenth day of the calendar month next preceding such interest payment date; and with respect to any interest payment date of the Bonds occurring on the fifteenth day of any month, the first day of such month.
"Refunding Date" shall mean June 15, 2021, or such later date as may be established by the Company; provided, however, that the Refunding Date shall not be later than ninety (90) days following the date of delivery of the Series 2021 Bonds to the original purchaser or purchasers of the Series 2021 Bonds.
"Revenues" shall mean all moneys paid or payable by the Company to the Trustee for the account of the Issuer in respect of the principal of and premium, if any, and interest on the Bonds, including, without limitation, amounts paid or payable by the Company pursuant to Sections 5.2 and 9.1 of the Loan Agreement as Loan Payments, amounts paid or payable by the Company in respect of the First Mortgage Bonds and the Thirty-ninth Assignment, and all receipts of the Trustee credited under the provisions of this Indenture against such payments.
"Securities Depository" shall mean DTC and any other "clearing agency" registered under Section 17A of the Securities Exchange Act of 1934, as amended.
"Series 2021 Bonds" shall mean the $83,695,000 aggregate principal amount of Mississippi Business Finance Corporation Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021 authorized to be issued pursuant to this Indenture.
"Thirty-ninth Assignment" shall mean the Thirty-ninth Assignment of Availability Agreement, Consent and Agreement by and among the Company, Entergy Arkansas, LLC, Entergy Louisiana, LLC, Entergy Mississippi, LLC, Entergy New Orleans, LLC, the Trustee and the Company Mortgage Trustee.
"Trustee" shall mean the banking corporation or association designated as Trustee herein, and its successor or successors as such Trustee. The original Trustee is The Bank of New York Mellon, New York, New York.
"Trust Estate" shall mean the property conveyed to the Trustee pursuant to the Granting Clauses hereof.
"Underwriter" shall mean, in respect of the Series 2021 Bonds, Morgan Stanley & Co. LLC, and, in respect of any Additional Bonds, any underwriter designated as such in connection with the issuance of such Additional Bonds.
Section 1.2 Use of Words and Phrases. "Herein," "hereby," "hereunder," "hereof," "hereinabove," "hereinafter" and other equivalent words and phrases refer to this Indenture and not solely to the particular portion thereof in which any such word is used. The definitions set forth in Section 1.1 hereof include both singular and plural. Whenever used herein, any pronoun shall be deemed to include both singular and plural and to cover all genders. 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 "Bond," "owner," "holder" and "person" shall include the plural, as well as the singular, number.
Unless the context shall otherwise indicate, "Person" or "person" shall mean any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
ARTICLE II
THE BONDS
Section 2.1 Authorized Form and Amount of Bonds. No Bonds may be issued under the provisions of this Indenture except in accordance with this Article. All Bonds issued hereunder shall be in the form of registered Bonds without coupons. The total principal amount of Bonds that may be issued is hereby expressly limited to $83,695,000, except as provided in Sections 2.8, 2.11 and 2.12 hereof.
Section 2.2 Details of Series 2021 Bonds. The Series 2021 Bonds (i) shall be designated "Mississippi Business Finance Corporation Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021," (ii) shall be in the aggregate principal amount of $83,695,000, (iii) shall be issued in denominations of $5,000 and any integral multiple thereof, (iv) shall be numbered consecutively from R-1 upwards in order of issuance according to the records of the Trustee, (v) shall be dated as hereinafter provided, (vi) shall bear interest as hereinafter provided, payable semiannually on June 1 and December 1 of each year commencing December 1, 2021; and (vii) shall mature on the Maturity Date.
The Series 2021 Bonds shall bear interest from and including the date thereof until the principal thereof shall have become due and payable in accordance with the provisions hereof, whether at maturity, upon redemption or otherwise, at the rate of 2.375% per annum. Overdue principal of the Series 2021 Bonds shall bear interest at the rate of 2.375% per annum until paid. Overdue installments of interest shall not bear interest. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30-day months.
Series 2021 Bonds issued before December 1, 2021, shall be dated June 15, 2021, and Series 2021 Bonds issued on or subsequent to December 1, 2021, shall be dated as of the interest payment date next preceding the date of authentication and delivery thereof by the Trustee, unless such date of authentication and delivery shall be an interest payment date, in which case they shall be dated as of such date of authentication and delivery; provided, however, that if, as shown by the records of the Trustee, interest on any Bonds surrendered for transfer or exchange shall be in default, the Bonds issued in exchange for Bonds surrendered for transfer or exchange shall be dated as of the date to which interest has been paid in full on the Bonds surrendered.
The Series 2021 Bonds shall be substantially in the form set forth in Exhibit A attached hereto with such appropriate variations, omissions and insertions as are permitted or required by this Indenture.
Section 2.3 Payment. The principal of and premium, if any, on the Bonds shall be paid upon the presentation and surrender of said Bonds at the principal corporate trust office of the Trustee. The interest on the Bonds shall be payable by check drawn upon the Trustee and mailed to the registered owners as of the close of business on the Record Date with respect to the interest payment date at their respective addresses as such appear on the bond registration books kept by the Trustee. All payments shall be made in lawful money of the United States of America.
Section 2.4. Execution. The Bonds shall be executed on behalf of the Issuer with the manual or facsimile signatures of the Chairman, the Vice Chairman or the Executive Director and the Secretary, the Treasurer or an Assistant Secretary of the Issuer shall attest such execution.
If any of the officers whose manual or facsimile signatures shall be upon the Bonds shall cease to be such officers of the Issuer before such Bonds shall have been actually authenticated by the Trustee or delivered by the Issuer, such Bonds nevertheless may be authenticated, issued and delivered with the same force and effect as though the person or persons whose signature shall be upon such Bonds had not ceased to be such officer or officers of the Issuer; and also any such Bonds may be signed on behalf of the Issuer by those persons who, at the actual date of the execution of such Bond, shall be the proper officers of the Issuer, although at the nominal date of such Bonds any such person shall not have been such officer of the Issuer.
Section 2.5 Limited Obligations. The Bonds shall be limited obligations of the Issuer, payable by the Issuer solely out of the Revenues (including all sums deposited in any fund from time to time pursuant to this Indenture, the Loan Agreement, and in certain events, as provided herein, out of amounts attributable to Bond proceeds or amounts obtained through the exercise of any remedy provided herein upon occurrence of an Event of Default under this Indenture). The Bonds shall never be paid out of any other funds of the Issuer except such Revenues. No recourse under the Bonds shall be had against any past, present or future officer or trustee of the Issuer. The Bonds shall never be paid in whole or in part out of any funds raised or to be raised by taxation or out of any other revenues or assets of the Issuer or the State except those Revenues pledged by this Indenture.
THE BONDS ARE NOT A GENERAL OBLIGATION OF THE ISSUER AND ARE NOT AN INDEBTEDNESS OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF. NEITHER THE FAITH AND CREDIT OF THE ISSUER NOR THE FAITH AND CREDIT OR THE TAXING POWER OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF THE BONDS, OR PREMIUM, IF ANY, OR THE INTEREST THEREON OR OTHER COSTS INCIDENTAL THERETO. THE ISSUER HAS NO TAXING POWER.
Section 2.6. Authentication. Only such Bonds as shall have endorsed thereon a Certificate of Authentication substantially in the form set forth in Exhibit A attached hereto duly executed by the Trustee shall be entitled to any right or benefit under this Indenture. No Bond shall be valid and obligatory for any purpose unless and until such Certificate of Authentication shall have been duly executed by the Trustee, and such Certificate of the Trustee upon any such Bond shall be conclusive evidence that such Bond has been authenticated and delivered under this Indenture. The Trustee's Certificate of Authentication on any Bond shall be deemed to have been executed if signed by an authorized officer of the Trustee, but it shall not be necessary that the same officer sign the Certificate of Authentication on all of the Bonds issued hereunder.
Section 2.7. Delivery of the Bonds. The Issuer shall execute and deliver to the Trustee and the Trustee shall authenticate the Bonds of any series and deliver said Bonds to the
Underwriter as may be directed hereinafter in this Section 2.7, in Section 2.11 hereof, or in any supplemental indenture.
Prior to the delivery on original issuance by the Trustee of any authenticated Bonds of any series there shall be or have been delivered to the Trustee:
(a)An original duly executed counterpart or a duly certified copy of this Indenture and, in the case of Additional Bonds, a supplemental indenture by and between the Issuer and the Trustee setting forth the details concerning such Bonds.
(b)An original duly executed counterpart or a duly certified copy of the Loan Agreement and, in the case of Additional Bonds, an amendment of or supplement to the Loan Agreement, if any.
(c)With respect to the Series 2021 Bonds, the original duly executed First Mortgage Bonds, registered in the name of the Trustee, against receipt thereof by the Trustee, and the Thirty-ninth Assignment; and, with respect to any Additional Bonds, any other series of First Mortgage Bonds and any other assignment of the Availability Agreement that may be provided by the Company pursuant to Section 5.9 of the Loan Agreement.
(d)A written order to the Trustee by the Issuer to authenticate and deliver the Bonds of such series to the Underwriter thereof upon payment to Trustee, but for the account of the Issuer, of a sum specified in such order, and such request and authorization shall specify the amounts to be deposited in the funds created hereunder.
(e)A copy, duly certified by the Secretary or an Assistant Secretary, of the proceedings of the Issuer authorizing the issuance of such Bonds.
(f)A written opinion of Bond Counsel as to the enforceability, authorization, execution and delivery of this Indenture and such Bonds.
(g)In the case of any series of Additional Bonds, a written opinion of Bond Counsel to the effect that the issuance of such Bonds and the execution thereof have been duly authorized, all conditions precedent to the delivery thereof have been fulfilled, and that the exclusion of the interest on the Series 2021 Bonds and any Additional Bonds theretofore issued from gross income for federal income tax purposes will not be affected by the issuance of the Bonds being issued.
Section 2.8. Mutilated, Destroyed or Lost Bonds. In case any Bond issued hereunder shall become mutilated or be destroyed or lost, the Issuer shall, if not then prohibited by law, cause to be executed and the Trustee shall authenticate and deliver a new Bond of the same series of like date, number, maturity and tenor in exchange and substitution for and upon cancellation of such mutilated Bond, or in lieu of and in substitution for such Bond destroyed or lost, upon the holder's paying the reasonable expenses and charges of the Issuer and Trustee in connection therewith, and, in the case of a Bond destroyed or lost, his filing with the Trustee evidence satisfactory to the Company and the Trustee that such Bonds were destroyed or lost,
and of his ownership thereof, and furnishing the Issuer, the Company and the Trustee with indemnity satisfactory to them. The Trustee is hereby authorized to authenticate any such new Bond. In the event any such Bonds shall have matured, instead of issuing a new Bond, the Issuer may pay the same without the surrender thereof.
Section 2.9. Registration and Exchange of Bonds. The Issuer hereby constitutes and appoints the Trustee as Bond Registrar of the Issuer, and as Bond Registrar the Trustee shall keep books for the registration and for the transfer of the Bonds as provided in this Indenture at the principal corporate trust office of the Trustee. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of and interest on any such Bond shall be made only to or upon the order of the registered owner thereof or his legal representative, and neither the Issuer, the Trustee, nor the Bond Registrar shall be affected by any notice to the contrary but such registration may be changed as herein provided. All payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid.
Bonds may be transferred on the books of registration kept by the Trustee by the registered owner in person or by his duly authorized attorney, upon surrender thereof, together with a written instrument of transfer duly executed by the registered owner or his duly authorized attorney in such form as shall be satisfactory to the Trustee. Upon surrender for transfer of any Bond at the principal corporate office of the Trustee, the Issuer shall execute and the Trustee shall authenticate and deliver in the name of the transferee or transferees a new Bond or Bonds in the same aggregate principal amount and of any authorized denomination or denominations. The transferor shall also provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Code Section 6045. The Trustee may rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
Bonds may be exchanged at the principal corporate trust office of the Trustee for an equal aggregate principal amount of Bonds of any other authorized denomination or denominations of the same series with corresponding maturities. The Issuer shall execute and the Trustee shall authenticate and deliver Bonds which the bondholder making the exchange is entitled to receive, bearing numbers not then outstanding. The execution by the Issuer of any Bond of any denomination shall constitute full and due authorization of such denomination and the Trustee shall thereby be authorized to authenticate and deliver such Bond.
Such transfers of registration or exchanges of Bonds shall be without charge to the holders of such Bonds, but any taxes or other governmental charges required to be paid with respect to the same shall be paid by the holder of the Bond requesting such transfer or exchange as a condition precedent to the exercise of such privilege.
The Trustee shall not be required to transfer or exchange any Bond after the mailing of notice calling such Bond for redemption has been made, nor during the period of fifteen (15) days next preceding mailing of a notice of redemption of any Bonds.
Section 2.10 Cremation and Other Dispositions. All Bonds surrendered for the purpose of payment or retirement, or for exchange, or for replacement or payment as provided above, or for cancellation, shall be canceled upon surrender thereof to the Trustee and, at the option of the Trustee, either cremated, shredded or otherwise disposed of. The Trustee shall execute and forward to the Issuer an appropriate certificate describing the Bonds involved and the manner of disposition.
Section 2.11 Additional Bonds. The Issuer, at the request of the Company and to the extent permitted by law in effect at the time thereof, may issue from time to time one or more series of Additional Bonds for the purposes provided in Section 4.2 of the Loan Agreement. Additional Bonds shall be secured equally and ratably with the Series 2021 Bonds and any other Additional Bonds theretofore issued and then outstanding, except insofar as any sinking, amortization or other fund, or any terms or conditions of redemption or purchase, established under this Indenture may afford additional benefit or security for the Bonds of any particular series. Before any Additional Bonds are authenticated there shall be delivered to the Trustee the items required for the issuance of Bonds by Section 2.7 hereof.
The right to issue Additional Bonds set forth in this Indenture shall not imply that the Issuer may not issue, and the Issuer expressly reserves the right to issue, to the extent permitted by law, obligations under another indenture or indentures to provide additional funds to pay the cost of additional facilities at the Plant, or to refund all or any principal amount of all or any series of Bonds, or any combination thereof, and the provisions of this Indenture governing the issuance of Additional Bonds shall not apply thereto.
The proceeds of the issuance and sale of any series of Additional Bonds, including purchase premium, if any, and accrued interest, if any, thereon to the date of delivery thereof paid by the Underwriter, shall be applied simultaneously with the delivery of such Additional Bonds in the manner provided in this Indenture and in the supplemental indenture authorizing such Additional Bonds.
Notwithstanding anything herein to the contrary, no Additional Bonds shall be issued unless (i) the Loan Agreement is in effect, and (ii) at the time of issuance there is no Event of Default (as defined in the Loan Agreement) under the Loan Agreement or Event of Default under this Indenture.
Section 2.12 Temporary Bonds. Until Bonds in definitive form are ready for delivery, the Issuer may execute, and upon the request of the Issuer, the Trustee shall authenticate and deliver, subject to the provisions, limitations and conditions set forth herein, one or more Bonds in temporary form, whether printed, typewritten, lithographed or otherwise produced, substantially in the form of the definitive Bonds, with appropriate omissions, variations and insertions, and in authorized denominations. Until exchanged for Bonds in definitive form, such Bonds in temporary form shall be entitled to the lien and benefit of this Indenture. Upon the presentation and surrender of any Bond or Bonds in temporary form, the Issuer shall, without unreasonable delay, prepare, execute and deliver to the Trustee and the Trustee shall authenticate and deliver, in exchange therefor, a Bond or Bonds in definitive form.
Such exchange shall be made by the Trustee without making any charge therefor to the holder of such Bond in temporary form.
Section 2.13. Book-Entry System
(a)DTC will act as the initial Securities Depository for the Bonds. The Bonds shall be initially issued in the form of a single fully registered Bond registered in the name of Cede & Co., as nominee for DTC, as Registered Owner of the Bonds, and held in the custody of DTC. So long as Cede & Co. is the Registered Owner of the Bonds, as nominee of DTC, references herein to Registered Owners, Bondholders or holders of the Bonds shall mean Cede & Co. and shall not mean the beneficial owners of the Bonds.
(b)While DTC is the Securities Depository, the ownership interest of each of the beneficial owners of the Bonds will be recorded through the records of a DTC Participant. Transfers of beneficial ownership interests in the Bonds which are registered in the name of Cede & Co. will be accompanied by book entries made by DTC and, in turn, by the DTC Participants who act on behalf of the beneficial owners of the Bonds.
(c)With respect to Bonds registered in the name of the Securities Depository, the Issuer, the Bond Registrar, the Paying Agent, any co-paying agent and the Trustee shall have no responsibility or obligation to any Person on behalf of whom such Securities Depository holds an interest in the Bonds, except as provided in this Indenture. Without limiting the immediately preceding sentence, the Issuer, the Bond Registrar, the Paying Agent, any co-paying agent and the Trustee shall have no responsibility or obligation with respect to (i) the accuracy of the records of the Securities Depository with respect to any ownership interest in the Bonds, (ii) the delivery to any Person, other than a Bondholder, as shown on the Bond Register, of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any Person, other than a Registered Owner, as shown in the Bond Register of any amount with respect to principal of or premium, if any, or interest on, the Bonds.
(d)Notwithstanding any other provisions of this Indenture to the contrary, the Issuer, the Bond Registrar, the Paying Agent, any co-paying agent and the Trustee shall be entitled to treat and consider the Person in whose name each Bond is registered in the Bond Register as the absolute owner of such Bond for the purpose of payment of principal, premium, if any, and interest with respect to such Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The Paying Agent shall pay all principal of, premium, if any, and interest on the Bonds only to or upon the order of the respective owners, as shown in the Bond Register as provided in this Indenture, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to payment of principal of and premium, if any, and interest on, the Bonds to the extent of the sum or sums so paid.
(e)No Person other than a Registered Owner, as shown in the Bond Register, shall receive a Bond certificate evidencing the obligation of the Issuer to make payments of principal, premium, if any, and interest, pursuant to this Indenture.
(f)Except in the case of payment upon maturity or redemption if the book-entry system is not in effect, any provision of this Indenture permitting or requiring the delivery of Bonds shall, while the book-entry system is in effect, be satisfied by the notation on the books of the Securities Depository, of the transfer of the beneficial owner's interest in such Bond.
(g)So long as the book-entry system is in effect, the Trustee, the Paying Agent, any co-paying agent and the Bond Registrar shall comply with the terms of the DTC Letter.
(h)The Securities Depository may determine to discontinue providing its service with respect to the Bonds at any time by giving reasonable written notice and all relevant information on the beneficial owners of the Bonds, which shall include, without limitation, the name, address of record and taxpayer identification number of each such beneficial owner of the Bonds, to the Issuer and the Trustee. If there is no successor Securities Depository appointed by the Issuer, the Trustee, based solely upon information provided to it in writing by the Securities Depository, which shall include, without limitation, the name, address of record and taxpayer identification number of each such beneficial owner of the Bonds, shall authenticate and deliver Bonds to the beneficial owners thereof. In the event that the Company determines that the Securities Depository is incapable of discharging its responsibilities described herein or in any agreement among the Issuer, the Trustee and the Securities Depository, the Issuer, at the direction of the Company, shall (i) appoint a successor securities depository, qualified to act as such under Section 17(a) of the Securities Exchange Act of 1934, as amended, notify the Securities Depository of the appointment of such successor securities depository and transfer one or more separate Bonds to such successor securities depository or (ii) notify the Securities Depository and the beneficial owners, identified by the Securities Depository, of the availability through the Securities Depository of Bonds and transfer one or more separate Bonds to the beneficial owners, identified in writing by the Securities Depository as having Bonds credited to their accounts. In such event, the Bonds shall no longer be restricted to being registered in the Bond Register in the name of the Securities Depository but may be registered in the name of the successor securities depository, or its nominee, or in whatever name or names Bondholders transferring or exchanging Bonds shall designate, in accordance with the provisions of this Indenture.
Upon the written consent of 100% of the beneficial owners of the Bonds, the Trustee, in accordance with any agreement among the Issuer, the Trustee, and the Securities Depository, shall withdraw the Bonds from the Securities Depository, and authenticate and deliver Bonds fully registered to the assignees of the Securities Depository or its nominee. If the request for such withdrawal is not the result of any Issuer action or inaction, such withdrawal, authentication and delivery shall be at the cost and expense (including costs of printing, preparing and delivering such Bonds) of the Persons requesting such withdrawal, authentication and delivery. In connection with any proposed transfer outside the book-entry system, the Issuer or the Company shall provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Code Section 6045. The Trustee may rely on the
information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
Section 2.14. Payments to Securities Depository. (a) Notwithstanding any other provision of this Indenture to the contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect to principal of and premium, if any, and interest on, such Bond and all notices with respect to such Bond shall be made and given, respectively, pursuant to DTC's rules and procedures, or in the case of a successor Securities Depository, pursuant to any agreement among the Issuer, the Trustee, the Bond Registrar, any co-paying agent, and the Securities Depository.
(b) With respect to Bonds registered in the name of a Securities Depository (or its nominee) neither the Trustee, the Issuer nor the Company shall have any obligation to any of its members or participants or to any Person on behalf of whom an interest is held in the Bonds.
ARTICLE III
REDEMPTION OF BONDS BEFORE MATURITY
Section 3.1 Redemption. The Series 2021 Bonds shall be subject to redemption prior to maturity as follows:
(a)The Series 2021 Bonds shall be subject to mandatory redemption in whole, at a redemption price equal to 100% of the principal amount thereof being redeemed plus accrued interest thereon to the redemption date on the ninetieth day (or such earlier date as may be designated by the Company) after a Determination of Taxability. Subject to the foregoing provisions of this Section 3.1(a) the Series 2021 Bonds shall be redeemed in whole, unless, in the opinion of Bond Counsel, the redemption of a portion of the Series 2021 Bonds would have the result that interest payable on the Series 2021 Bonds remaining outstanding after such redemption would not be includable in the gross income for federal income tax purposes of any owner of any such Series 2021 Bonds. Any such partial redemption shall be in such amount as is necessary to accomplish such result.
(b)The Series 2021 Bonds are subject to optional redemption by the Issuer, at the written direction of the Company, at any time on and after June 1, 2026, in whole or in part (and if in part, by lot or in such other manner as may be determined by the Trustee to be fair and equitable), at a redemption price equal to 100% of the principal amount thereof plus accrued interest thereon to the redemption date.
(c)The Series 2021 Bonds are subject to special optional redemption by the Issuer, at the written direction of the Company, in whole but not in part, at any time, at a redemption price equal to 100% of the principal amount thereof plus accrued interest thereon to the redemption date but without redemption premium if:
i)the Company shall have determined that the continued operation of the Plant is impracticable, uneconomical or undesirable for any reason;
ii)the Company shall have determined that the continued operation of the Facilities is impracticable, uneconomical or undesirable due to (1) the imposition of taxes, other than ad valorem taxes currently levied upon privately-owned property used for the same general purpose as the Facilities, or other liabilities or burdens with respect to the Facilities or the operation thereof, (2) changes in technology, in environmental standards or legal requirements or in the economic availability of materials, supplies, equipment or labor or (3) destruction of or damage to all or part of the Facilities;
iii)all or substantially all of the Facilities or the Plant shall have been condemned or taken by eminent domain; or
iv)the operation of the Facilities or the Plant shall have been enjoined or shall have otherwise been prohibited by an order, decree, rule or regulation of any court or of any federal, state or local regulatory body, administrative agency or other governmental body.
In case a Series 2021 Bond is of a denomination larger than $5,000, a portion of such Bond ($5,000 or any integral multiple thereof) may be redeemed if otherwise permitted, but Series 2021 Bonds shall be redeemed only in the principal amount of $5,000 or any integral multiple thereof.
Section 3.2. Notice. Notice of any redemption, identifying the Bonds or portions thereof being called and the date on which they shall be presented for payment, shall be given by the Trustee by first class mail, postage prepaid, to the registered owner of each such Bond addressed to such registered owner at his registered address and placed in the mails not less than thirty (30) days nor more than ninety (90) days prior to the date fixed for redemption; provided, however, that failure to give such notice by mailing, or any defect therein, shall not affect the validity of any proceeding for the redemption of any Bond with respect to which no such failure or defect has occurred.
Any notice mailed as provided in this Section shall be conclusively presumed to have been duly given, whether or not the holder or owner receives the notice.
With respect to notice of redemption of the Bonds at the option of the Issuer (at the direction of the Company), unless moneys sufficient to pay the principal of and premium, if any, and interest on the Bonds to be redeemed shall have been received by the Trustee prior to the giving of such notice, such notice shall state that said redemption shall be conditional upon the receipt of such moneys by the Trustee on or prior to the date fixed for such redemption. So long as Cede & Co. is the registered owner of the Bonds, as nominee of DTC, notice of any redemption will be given by the Trustee to Cede & Co., not to the beneficial owners of the Bonds, as set forth above or by email. If such moneys shall not have been so received, such notice shall be of no force and effect, the Issuer shall not redeem such Bonds and the Trustee shall give notice, in the manner in which the notice of redemption was given, that such moneys were not so received.
Section 3.3 Redemption Payments. Subject to the provisions of the last paragraph of Section 3.2 hereof, on or prior to the date fixed for redemption, funds shall be deposited with the Trustee to pay, and the Trustee is hereby authorized and directed to apply such funds to the payment of, the Bonds or portions thereof to be redeemed, together with accrued interest thereon to the redemption date and any required premium. Upon the giving of notice and the deposit of funds for redemption, interest on the Bonds or portions thereof thus redeemed shall no longer accrue after the date fixed for redemption.
Section 3.4 Cancellation. All Bonds which have been redeemed shall not be reissued but shall be canceled and disposed of by the Trustee in accordance with Section 2.10 hereof.
Section 3.5. Partial Redemption of Bonds. Upon surrender of any Bond for redemption in part only, the Issuer shall execute and the Trustee shall authenticate and deliver to the holder thereof a new Bond or Bonds of the same series and the same maturity of authorized denominations in an aggregate principal amount equal to the unredeemed portion of the Bond surrendered.
ARTICLE IV
GENERAL COVENANTS; FIRST MORTGAGE BONDS; ADDITIONAL SECURITY
Section 4.1 Payment of Principal, Premium, If Any, and Interest. The Issuer covenants that it will promptly pay or cause to be paid the principal of and premium, if any, and interest on every Bond issued under this Indenture at the place, on the dates and in the manner provided herein and in the Bond according to the true intent and meaning thereof; provided, however, that the obligation of the Issuer hereunder to make or cause to be made any payment to the Trustee in respect of the principal of or premium, if any, or interest on the Bonds shall be reduced by the amount of moneys, if any, on deposit in the Bond Fund and available to be applied by the Trustee toward the payment of the principal of or premium, if any, or interest on the Bonds. The principal and premium, if any, and interest (except interest, if any, paid from the proceeds from the sale of the Bonds) are payable solely from the Revenues, which Revenues are hereby specifically pledged and assigned for the payment thereof in the manner and to the extent herein specified, and nothing in the Bonds or this Indenture should be considered as assigning or pledging any funds or assets of the Issuer other than the Revenues and the right, title and interest of the Issuer in the Loan Agreement (except for the rights of the Issuer under Sections 5.4, 5.6, 5.7, 5.8 and 8.5 of the Loan Agreement and any rights of the Issuer to receive notices, certificates, requests, requisitions, directions and other communications under the Loan Agreement), including in respect of the First Mortgage Bonds and the Thirty-ninth Assignment, in the manner and to the extent herein specified. Anything in this Indenture to the contrary notwithstanding, it is understood that whenever the Issuer makes any covenant involving financial commitments, including, without limitation, those in the various sections of this Article IV, it pledges no funds or assets other than the Revenues and the right, title and interest of the Issuer in the Loan Agreement (except for the rights of the Issuer under Sections 5.4, 5.6, 5.7, 5.8 and 8.5 of the Loan Agreement and any rights of the Issuer to receive notices, certificates, requests, requisitions, directions and other communications under the Loan Agreement), including in respect of the First Mortgage Bonds, the Thirty-ninth Assignment and the Bond Fund in the manner and to the extent herein specified, but nothing herein shall be construed as prohibiting the Issuer from using any other funds or assets.
Section 4.2. 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 any and every Bond executed, authenticated and delivered hereunder and in all resolutions pertaining thereto. The Issuer covenants that it is duly authorized under the constitution and laws of the State, including particularly and without limitation the Act, to issue Bonds authorized hereby and to execute this Indenture and to make the pledge and covenants in the manner and to the extent herein set forth; that all action on its part for the issuance of the Bonds and the execution and delivery of this Indenture has been duly and effectively taken; and that the Bonds in the hands of the holders and owners thereof are and will be valid and enforceable obligations of the Issuer according to the import thereof.
Section 4.3. 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 indenture or indentures supplemental hereto and such further acts, instruments and transfers as the Trustee may reasonably require for the better assuring, transferring, pledging, assigning and confirming unto the Trustee the Trust Estate.
Section 4.4 Inspection of Books. The Issuer and the Trustee covenant and agree that all books and documents in their possession relating to the Facilities and the revenues derived from the Facilities shall at all reasonable times be open to inspection by such accountants or other agencies as the other party may from time to time designate and by the Company.
Section 4.5. Rights Under Loan Agreement. The Loan Agreement, a duly executed counterpart of which has been filed with the Trustee, sets forth covenants and obligations of the Issuer and the Company, including provisions that subsequent to the issuance of Bonds and prior to their payment in full or provision for payment thereof in accordance with the provisions hereof, the Loan Agreement may not be effectively amended, changed, modified, altered or terminated, or any provision waived without the written consent of the Trustee, and reference is hereby made to the same for a detailed statement of said covenants and obligations of the Company thereunder, and the Issuer agrees that the Trustee in its name or in the name of the Issuer may enforce all rights of the Issuer and all obligations of the Company under and pursuant to the Loan Agreement or the First Mortgage Bonds, for and on behalf of the bondholders, whether or not the Issuer is in default hereunder.
Section 4.6. Prohibited Activities. The Issuer covenants that it shall not take any action or suffer or permit any action to be taken or condition to exist which causes or may cause the interest payable on the Bonds to be includable in gross income for purposes of federal income taxation. Without limiting the generality of the foregoing, the Issuer covenants that (a) the proceeds of the sale of the Bonds, the earnings thereon, and any other moneys on deposit in any fund or account maintained in respect of the Bonds (whether such moneys were derived from the proceeds of the sale of the Bonds or from other sources) will not be used in a manner that would cause the Bonds to be treated as "arbitrage bonds" within the meaning of Section 148 of the Code, and (b) all action with respect to the Bonds required by Section 148(f) of the Code shall be taken in a timely manner.
Section 4.7. No Transfer of First Mortgage Bonds. The Trustee shall not sell, assign or transfer the First Mortgage Bonds except to a successor trustee under this Indenture.
Section 4.8. Voting of First Mortgage Bonds. The Trustee shall, as the holder of the First Mortgage Bonds, attend such meeting or meetings of holders of first mortgage bonds issued under the Company Mortgage or, at its option, deliver its proxy in connection therewith, as it relates to matters with respect to which it is entitled to vote or consent. So long as no Event of Default hereunder shall have occurred and be continuing, either at any such meeting or meetings, or otherwise when the consent of the holders of the Company's first mortgage bonds issued under the Company Mortgage is sought without a meeting, the Trustee shall vote as the holder of the First Mortgage Bonds, or shall consent with respect thereto, proportionately with what the Trustee reasonably believes will be the vote or consent of the holders of all other first
mortgage bonds of the Company then outstanding under the Company Mortgage the holders of which are eligible to vote or consent; provided, however, that the Trustee shall not vote as such holder in favor of, or give its consent to, any amendment or modification of the Company Mortgage that is correlative to any amendment or modification of this Indenture referred to in any of the clauses (a) through (f) of Section 12.2 hereof without the prior consent and approval, obtained in the manner prescribed in said Section 12.2, of Bondholders, which would be required under said Section 12.2 for such correlative amendment or modification of this Indenture.
For purposes of this Section, the Trustee may conclusively rely on a bondholder's certificate delivered to the Trustee, signed by the temporary chairman, the temporary secretary, the permanent chairman, the permanent secretary, or an inspector of votes at any meeting or meetings of bondholders under the Company Mortgage, or by the Company Mortgage Trustee in the case of consents of such bondholders that are sought without a meeting, which certificate states what the signer thereof reasonably believes will be the proportionate votes or consents of the holders of all first mortgage bonds (other than the First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture) outstanding under the Company Mortgage and counted for the purposes of determining whether such bondholders have approved or consented to the matter put before them.
Any action taken by the Trustee in accordance with the provisions of this Section shall be binding upon the Issuer and the Bondholders.
Section 4.9. Surrender of First Mortgage Bonds. The Trustee shall surrender First Mortgage Bonds to the Company Mortgage Trustee in accordance with the provisions of Section 5.9(d) and (e) of the Loan Agreement.
Section 4.10 Notice to Company Mortgage Trustee. In the event that a payment on the First Mortgage Bonds shall have become due and payable and shall not have been fully paid after the expiration of the applicable grace period, the Trustee shall immediately give notice thereof to the Company Mortgage Trustee specifying the amount of funds required to make such payment. In the event that the Bonds (or any portion thereof) are to be redeemed pursuant to any provisions of this Indenture requiring mandatory redemption of such Bonds (other than at the direction of the Company), the Trustee shall forthwith give notice thereof to the Company Mortgage Trustee specifying the principal amount of Bonds so to be redeemed and the redemption date therefor. Any such notice given by the Trustee shall be signed by its Vice President or a Trust Officer thereof. The Trustee shall incur no liability for failure to give any such notice and such failure shall have no effect on the obligations of the Company on the First Mortgage Bonds or on the rights of the Trustee or of the bondholders.
Section 4.11 Satisfaction and Surrender of Thirty-ninth Assignment. The Issuer and the Trustee agree that the right of the Trustee to receive any payments under the Thirty-ninth Assignment shall be reduced by the amount of any reduction under this Indenture of the amount of the corresponding payment required to be made by the Issuer hereunder. Promptly after the date on which there cease to be any Series 2021 Bonds outstanding, the Trustee shall surrender the Thirty-ninth Assignment to the Company, along with such other appropriate instruments evidencing transfer and release as the Company may reasonably request.
Section 4.12. No Transfer of Thirty-ninth Assignment or Trustee’s Interest in Underlying Agreement.
The Trustee shall not sell, assign or transfer the Thirty-ninth Assignment or any interest in the Availability Agreement, except to a successor trustee under this Indenture, and the Trustee is authorized to enter into an agreement with the Company to such effect.
Section 4.13. Preconsent to Termination of Availability Agreement and Thirty-ninth Assignment.
The Company reserves the right to terminate the Availability Agreement and the Thirty-ninth Assignment, and each holder of Series 2021 Bonds, by its acquisition of an interest in such Series 2021 Bonds, irrevocably consents to such termination without any other further action by any holder of such Series 2021 Bonds, upon delivery to the Trustee and the Company Mortgage Trustee of an Officer's Certificate (as such term is defined in the Company Mortgage) stating the following: The Availability Agreement and any other outstanding assignments thereof are similarly terminated as they relate to all other series of first mortgage bonds issued under the Company Mortgage and all other indebtedness of the Company or no longer apply or do not apply to any other such series of first mortgage bonds issued under the Company Mortgage or indebtedness. The Trustee, as holder of the First Mortgage Bonds, shall also be deemed to have given the appropriate consent to such termination as is required under the terms of the Thirty-ninth Assignment.
Section 4.14 Amendments to Thirty-ninth Assignment.
The Trustee, as assignee of the Company under the Thirty-ninth Assignment, shall, at the request of the Company, take such other actions and execute such instruments as may be permitted by Article V of the Thirty-ninth Assignment; provided, however, that if the Company seeks to amend or modify the Thirty-ninth Assignment in a manner other than (i) that which does not materially adversely affect the rights of the Trustee, the Mortgage Trustee or the holders of the Series 2021 Bonds or (ii) that which is necessary in order to qualify the Company Mortgage under the Trust Indenture Act of 1939, as contemplated by Sections 1301 and 1302 of the Company Mortgage, the Trustee shall affirmatively seek the approval of the holders of a majority in aggregate principal amount of the Series 2021 Bonds then outstanding and the Trustee shall act in accordance with the instructions of the holders of a majority in aggregate principal amount of the Series 2021 Bonds outstanding and voting; provided, further, however, that if the holders of a majority in aggregate principal amount of the Series 2021 Bonds then outstanding do not vote, then the Trustee shall act in accordance with what the Trustee reasonably believes will be the vote or consent of the holders of all other first mortgage bonds then outstanding under the Company Mortgage.
Notwithstanding the foregoing, the Trustee shall not vote in favor of, or give its consent to, any modification of the Thirty-ninth Assignment which is correlative to a modification of this Indenture which would require the approval of the holders of the Series 2021 Bonds, except upon notification by the Trustee to the holders of the Series 2021 Bonds of such proposal and consent
thereto by the holders of the aggregate principal amount of the Series 2021 Bonds then outstanding which would be required for such correlative modification of this Indenture.
ARTICLE V
REVENUES AND FUNDS
Section 5.1 Creation of Bond Fund. There is hereby created and ordered to be established with the Trustee a special account of the Issuer to be designated "Mississippi Business Finance Corporation Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021 Bond Fund" (the "Bond Fund").
Section 5.2 Payments into Bond Fund. There shall be deposited into the Bond Fund as and when received:
(a)Any accrued interest received at the time of the issuance and delivery of the Bonds;
(b)All Revenues; and
(c)All moneys received by the Trustee under and pursuant to any of the provisions of the Loan Agreement, the First Mortgage Bonds, the Thirty-ninth Assignment or this Indenture that are not directed to be paid into a fund (or held) other than the Bond Fund.
Section 5.3 Use of Moneys in Bond Fund. Except as otherwise provided in Sections 5.8 and 11.2 hereof, moneys in the Bond Fund shall be used solely for the payment of the principal of and premium, if any, and interest on the Bonds and for the redemption or purchase of Bonds.
Section 5.4 Withdrawals from Bond Fund. The Bond Fund shall be in the name of the Issuer, designated as set forth in Section 5.1, and the Issuer hereby irrevocably authorizes and directs the Trustee to withdraw from the Bond Fund sufficient funds to pay the principal of and premium, if any, and interest on the Bonds at maturity and redemption prior to maturity and to use such funds for the purpose of paying principal, premium, if any, and interest in accordance with the provisions hereof pertaining to payment, which authorization and direction the Trustee hereby accepts.
Section 5.5 Non-Presentment of Bonds. In the event any Bond shall not be presented for payment when the principal thereof becomes due, either at maturity or otherwise, or at the date fixed for redemption thereof, if there shall have been deposited with the Trustee for that purpose, or left in trust if previously so deposited, funds sufficient to pay the principal thereof, and premium, if any, together with all interest unpaid and due thereon, to the due date thereof, for the benefit of the holder thereof, all liability of the Issuer to the holder thereof for the payment of the principal thereof, premium, if any, and interest thereon, shall forthwith cease, terminate and be completely discharged, and thereupon it shall be the duty of the Trustee to hold such fund or funds, without liability for interest thereon, for the benefit of the holder of such Bond, who shall thereafter be restricted exclusively to such fund or funds for any claim of whatever nature on his part under this Indenture or on, or with respect to, the Bond.
Section 5.6 Administration Expenses. It is understood and agreed that pursuant to the provisions of Sections 5.4 and 5.6 of the Loan Agreement, the Company agrees to pay the Administration Expenses of the Issuer. All such payments under the Loan Agreement that are received by the Trustee shall not be paid into the Bond Fund, but shall be segregated by the Trustee and expended solely for the purpose for which such payments are received.
Section 5.7. Moneys to be Held in Trust. All moneys required to be deposited with or paid to the Trustee for deposit into the Bond Fund under any provision of this Indenture and all moneys withdrawn from the Bond Fund and held by any Paying Agent, shall be held by the Trustee or such Paying Agent in trust, and except for moneys deposited with or paid to the Trustee for the redemption of Bonds, notice of which redemption has been duly given, and for moneys deposited with or paid to the Trustee pursuant to Article IX hereof, shall, while held by the Trustee or any Paying Agent, constitute part of the Trust Estate and be subject to the lien hereof. Any moneys received by or paid to the Trustee pursuant to any provision of the Loan Agreement calling for the Trustee to hold, administer and disburse the same in accordance with the specific provisions of the Loan Agreement shall be held, administered and disbursed pursuant to such provisions, and where required by the provisions of the Loan Agreement the Trustee shall set the same aside in a separate account. The Issuer agrees that, if it shall receive any moneys pursuant to applicable provisions of the Loan Agreement, it will forthwith upon receipt thereof pay the same over to the Trustee to be held, administered and disbursed by the Trustee in accordance with the provisions of the Loan Agreement pursuant to which the Issuer may have received the same.
Section 5.8. Refund to Company of Excess Payments. Anything herein to the contrary notwithstanding, the Trustee is authorized and directed to refund to the Company, upon written request, all excess amounts as specified in the Loan Agreement, whether such excess amounts be in the Bond Fund or in special accounts.
Section 5.9 Additional Funds and Accounts. In addition to the funds and accounts specifically authorized under this Article, the Trustee shall have the Issuer create and maintain such other funds and accounts as the Trustee may deem necessary for proper administration hereunder.
ARTICLE VI
APPLICATION OF PROCEEDS OF BONDS
Section 6.1 Deposit of Proceeds of Bonds. The proceeds of the Series 2021 Bonds shall be deposited in the bond fund created under the indenture governing the Series 2019 Bonds, together with moneys of the Company deposited in such bond fund, in order to redeem $83,695,000 in aggregate principal amount of the Series 2019 Bonds on the Refunding Date. The proceeds of the sale of any Additional Bonds shall be applied pursuant to Section 2.11 of this Indenture.
ARTICLE VII
INVESTMENTS
Section 7.1 Investment of Moneys. (a) Moneys held for the credit of the Bond Fund shall, upon written direction by the Authorized Company Representative, be invested and reinvested by the Trustee in any one or more of the following obligations or securities (as so directed by the Authorized Company Representative, which directions shall be conclusively relied upon by the Trustee), to the extent permitted by State law, on which neither the Company nor any of its affiliates is the obligor: (i) Government Securities; (ii) time deposits, including overnight deposits, savings accounts and deposit accounts represented by certificates of deposit in national or state banks (which may include the Trustee or its affiliates, any Paying Agent, and the Bond Registrar) having a combined capital and surplus of not less than $10,000,000, or savings and loan associations having total assets of not less than $20,000,000; (iii) bankers' acceptances drawn on and accepted by commercial banks (which may include the Trustee, any Paying Agent, and the Bond Registrar or any of their affiliates) having a combined capital and surplus of not less than $10,000,000; (iv) direct obligations of, or obligations the principal of and interest on that are unconditionally guaranteed by any state of the United States of America, the District of Columbia or the Commonwealth of Puerto Rico, or any political subdivision of any of the foregoing, which are rated in any of the three highest rating categories by a nationally recognized rating agency; (v) obligations of any agency or instrumentality of the United States of America; (vi) commercial or finance company paper that is rated in any of the three highest rating categories by a nationally recognized rating agency; (vii) corporate debt securities rated in any of the three highest rating categories by a nationally recognized rating agency; (viii) no load, open end, diversified money market mutual funds registered under the Investment Company Act of 1940, as amended, that seek to maintain a stable net asset value equal to $1.00 per unit as an investment objective; (ix) money market mutual funds, including, without limitation, any fund for which the Trustee, or an affiliate of the Trustee serves as an investment advisor, administrator shareholder, servicing agent and/or custodian or sub-custodian, notwithstanding that (A) the Trustee or an affiliate of the Trustee charges and collects fees and expenses from such funds for services rendered, (B) the Trustee charges and collects fees and expenses for services rendered pursuant to the Indenture, which fees are separate from the fees received from such funds, and (C) services performed for such funds and pursuant to the Indenture may converge at any time, and the Issuer and the Company specifically authorize the Trustee or an affiliate of the Trustee to charge and collect all fees and expenses from such funds for services rendered to such funds, in addition to any fees and expenses the Trustee may charge and collect for services rendered pursuant to this Indenture; (x) guaranteed investment contracts entered into with any financial institution, including the Trustee and any of its affiliates, the long term debt securities of which are rated in any of the three highest rating categories by a nationally recognized rating agency or, with respect to guaranteed investment contracts having a final maturity of not more than one month from the date of acquisition, the short-term debt securities of which are rated in the highest short term rating category by a nationally recognized rating agency; and (xi) repurchase agreements with banking or financial institutions having a combined capital and surplus of not less than $10,000,000 (which may include the Trustee, any Paying Agent and the Bond Registrar
or any of their affiliates) with respect to any of the foregoing obligations or securities. In the absence of written direction from the Authorized Company Representative naming the exact market fund to invest in, funds shall remain uninvested until such time as written directions are received. As used above, the reference to rating categories shall mean generic categories, which may include numerical or other qualifications of ratings within each such generic rating category such as "+" or "-." Such investments shall have maturity dates, or shall be subject to redemption by the holder at the option of the holder, on or prior to the dates the moneys invested therein will be needed as reflected by a statement of the Authorized Company Representative, which statement must be on file with the Trustee prior to any investment. Ratings of investments shall be determined at the time of purchase of such investments, and the Trustee shall have no responsibility to monitor the ratings of investments after the initial purchase of such investments. The Trustee shall have no responsibility for determining whether any of the foregoing investments is permitted by state law.
(b) Obligations so purchased as an investment of moneys in any fund or account shall be deemed at all times a part of such fund or account. Subject to the provisions of Section 7.2 hereof, any profit and income realized from such investments shall be credited to such fund or account and any loss shall be charged to such fund or account. The Trustee shall not be liable or responsible for any loss resulting from any investment made in the manner provided in this Section 7.1. The Company acknowledges that to the extent that regulations of the Comptroller of the Currency or other applicable regulatory agency grant the Company the right to receive brokerage confirmations of the security transactions as they occur, to the extent permitted by law, the Company specifically waives compliance with 12 C.F.R. 12 and hereby notifies the Trustee hereunder, that no brokerage confirmations need be sent relating to the security transactions as they occur.
Section 7.2 Arbitrage Law Requirements. In compliance with the provisions of Section 148 of the Code and regulations thereunder, all investments and reinvestments made under this Article VII shall be subject to the following:
(a)In the event that the Issuer or the Company is of the opinion that it is necessary or advisable to restrict or limit the yield on the investment of any moneys held in the Bond Fund or any other fund in order to avoid the Bonds being considered "arbitrage bonds" within the meaning of Section 148 of the Code, or any proposed, temporary or final regulations thereunder as such regulations may apply to obligations issued as of the date of original issuance and delivery of the Bonds, the Issuer or the Company may issue to the Trustee a written certificate to such effect together with appropriate written instructions so as to restrict or limit the yield on such investment in accordance with such certificate and instructions.
(b)The Trustee shall, at the written direction of the Company, establish and maintain within the Bond Fund or any other fund, in respect of each series of Bonds issued hereunder, a separate account into which shall be deposited, at the written direction of the Company, as and when received any amounts which are subject or could be subject to rebate to the United States of America under Section 148(f)(6) of the Code, which amounts shall be held
in such separate accounts until paid to the United States of America pursuant to said Section or until the Trustee determines that no such payment is required.
(c)The Issuer and the Trustee shall not make or agree to make any payments or participate in any non-arms-length transaction which would have the effect of reducing the earnings on investments, thereby reducing the amount required to be rebated to the United States of America under Section 148(f) of the Code and regulations thereunder.
(d)The Company has undertaken in the Loan Agreement to make the determinations required by paragraph (b) of this Section 7.2 and to provide statements to the Trustee to the effect that all actions with respect to the Bonds required by Section 148(f) of the Code have been taken. The Trustee shall be entitled to rely upon such determinations and statements as sufficient evidence of the facts therein contained.
ARTICLE VIII
RIGHTS OF THE COMPANY
Section 8.1 Rights of Company Under Loan Agreement. Nothing herein contained shall be deemed to impair the rights and privileges of the Company set forth in the Loan Agreement and an Event of Default hereunder shall not constitute an "Event of Default" under the Loan Agreement unless by the terms of the Loan Agreement it constitutes an "Event of Default" thereunder.
Section 8.2 Enforcement of Rights and Obligations. The Issuer and the Trustee agree that the Company in its own name or in the name of the Issuer may enforce all of the rights of the Issuer, all obligations of the Trustee, and all of the Company's rights provided for in this Indenture.
ARTICLE IX
DISCHARGE OF LIEN
Section 9.1 Discharge of Lien. If the Issuer shall pay or cause to be paid to the holders and owners of the Bonds the principal of and premium, if any, and interest to become due thereon at the times and in the manner stipulated therein, and if the Issuer shall keep, perform and observe all and singular the covenants and promises in the Bonds and in this Indenture expressed as to be kept, performed and observed by it on its part and shall pay or cause to be paid all other sums payable hereunder by the Issuer, and all amounts due the Issuer under the Loan Agreement have been paid, then these presents and the estate and rights hereby granted shall cease, terminate and be void, and thereupon the Trustee shall cancel and discharge the lien of this Indenture, and execute and deliver to the Issuer such instruments in writing as shall be requisite to satisfy the lien hereof, and reconvey to the Issuer the estate hereby conveyed, and assign and deliver to the Issuer any property at the time subject to the lien of this Indenture which may then be in its possession, except moneys or Government Securities held by it for the payment of the principal of and premium, if any, and interest on the Bonds.
Any Bond shall be deemed to be paid within the meaning of this Article when payment of the principal of and premium, if any, and interest on such Bond (whether at maturity or upon redemption as provided in this Indenture, or otherwise), either (a) shall have been made or caused to be made in accordance with the terms thereof, or (b) shall have been provided for by irrevocably depositing with the Trustee, in trust and irrevocably set aside exclusively for such payment, (i) moneys sufficient to make such payment or (ii) Government Securities (provided that in either case the Trustee shall have received an opinion of Bond Counsel to the effect that such deposit will not affect the exclusion of the interest on any of the Bonds from gross income for purposes of federal income taxation or cause any of the Bonds to be treated as arbitrage bonds within the meaning of Section 148(a) of the Code) maturing as to principal and interest in such amounts and at such times as will provide sufficient moneys to make such payment when due, and all necessary and proper fees, compensation and expenses of the Trustee and any Paying Agent pertaining to the Bonds with respect to which such deposit is made and all other liabilities of the Company under the Loan Agreement, pertaining to the Bonds with respect to which such deposit is made, shall have been paid or the payment thereof provided for to the satisfaction of the Trustee. No deposit under (b) above shall constitute such discharge and satisfaction until the Company shall have irrevocably notified the Trustee of the date for payment of such Bond either at maturity or on a date on which such Bond may be redeemed in accordance with the provisions hereof and notice of such redemption shall have been given or irrevocable provisions shall have been made for the giving of such notice, and in the case of a deposit of Government Securities in accordance with (b)(ii) above more than 90 days prior to such date of payment, unless the Trustee shall have received either (i) a verification report of an independent certified public accountant, verification agent or similar expert to the effect that such Government Securities, together with cash, if any, so deposited, and the earnings thereon, will be sufficient to pay the principal or redemption price of and interest on the Bond so deemed paid to and including the date of such payment or (ii) an opinion of Bond Counsel to the effect that all conditions
precedent in this Indenture for the release of this Indenture with respect to such Bond have been complied with and satisfied.
The Issuer or the Company may at any time surrender to the Trustee for cancellation by it any Bonds previously authenticated and delivered hereunder, which the Issuer or the Company may have acquired in any manner whatsoever, and such Bonds, upon such surrender and cancellation, shall be deemed to be paid and retired.
ARTICLE X
DEFAULT PROVISIONS AND REMEDIES OF TRUSTEE AND BONDHOLDERS
Section 10.1 Events of Default. Each of the following events shall constitute and is referred to in this Indenture as an "Event of Default":
(a)default in the due and punctual payment of any interest on any Bond hereby secured and outstanding and the continuance thereof for a period of sixty (60) days;
(b)default in the due and punctual payment of the principal of and premium, if any, on any Bond hereby secured and outstanding, whether at the stated maturity thereof, or upon unconditional proceedings for redemption thereof, or upon the maturity thereof by acceleration;
(c)an "Event of Default" as such term is defined in Section 8.1(a) of the Loan Agreement;
(d)default in the payment of any other amount required to be paid under this Indenture or in the performance or observance of any other of the covenants, agreements or conditions contained in this Indenture, or in the Bonds issued under this Indenture, and continuance thereof for a period of ninety (90) days after written notice specifying such failure and requesting that it be remedied, shall have been given to the Issuer and the Company by the Trustee, which may give such notice in its discretion and shall give such notice at the written request of holders of a majority in aggregate principal amount of the Bonds then outstanding, unless the Trustee, or the Trustee and holders of an aggregate principal amount of Bonds not less than the aggregate principal amount of Bonds the holders of which requested such notice, as the case may be, shall agree in writing to an extension of such period prior to its expiration; provided, however, that the Trustee, or the Trustee and the holders of such principal amount of Bonds, as the case may be, shall be deemed to have agreed to an extension of such period if corrective action is instituted by the Issuer, or the Company on behalf of the Issuer, within such period and is being diligently pursued. The term "default," as used in this clause (d), shall mean default by the Issuer in the performance or observance of any of the covenants, agreements or conditions on its part contained in this Indenture, or in the Bonds outstanding hereunder, exclusive of any period of grace required to constitute an "Event of Default" as hereinabove provided; or
(e)an "Event of Default" as such term is defined in Section 8.1(b) of the Loan Agreement.
Section 10.2 Acceleration. If any Event of Default described in clause (a), (b) or (e) of Section 10.1 hereof occurs and is continuing, the Trustee may, and upon the request of the owners of a majority in aggregate principal amount of all Bonds then outstanding shall, by notice in writing to the Issuer and the Company, declare the principal of all Bonds then outstanding to be immediately due and payable; and upon such declaration the principal of all of the Bonds, together with interest accrued thereon to the date of acceleration, shall become due and payable immediately at the place of payment provided therein, anything in the Indenture or in the Bonds
to the contrary notwithstanding. Immediately after any acceleration hereunder, the Trustee, to the extent it has not already done so, shall notify in writing the Issuer and the Company of the occurrence of such acceleration. Upon the occurrence of any acceleration hereunder, the Trustee shall immediately declare all payments under the Loan Agreement pursuant to Section 5.2 thereof to be due and payable immediately.
Upon the occurrence and continuance of an Event of Default under Section 10.1(c) hereof, and further upon the condition that, in accordance with the terms of the Company Mortgage, the First Mortgage Bonds shall have become immediately due and payable pursuant to any provision of the Company Mortgage, the Bonds shall, without further action, become and be immediately due and payable, anything in this Indenture or in the Bonds to the contrary notwithstanding, and the Trustee shall give notice thereof in writing to the Issuer and the Company, and notice to Bondholders in the same manner as a notice of redemption under Section 3.2 hereof.
Section 10.3 Other Remedies; Rights of Bondholders. Upon the occurrence and continuance of an Event of Default, the Trustee may, in addition or as an alternative, pursue any available remedy by suit at law or in equity (including as a holder of the First Mortgage Bonds) to enforce the payment of the principal of and premium, if any, and interest on the Bonds then outstanding hereunder, then due and payable.
If an Event of Default shall have occurred, and if it shall have been requested so to do by the holders of a majority in aggregate principal amount of Bonds outstanding hereunder and shall have been indemnified as provided in Section 11.1 hereof, the Trustee shall be obligated to exercise such one or more of the rights and powers conferred upon it by this Section as the Trustee, being advised by counsel, shall deem most expedient in the interests of the bondholders.
No remedy by the terms of this Indenture conferred upon or reserved to the Trustee (or to the Bondholders) 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 hereunder or now or hereafter existing at law or in equity or by statute.
No delay or omission to exercise any right or power accruing upon any default or Event of Default shall impair any such right or power or shall be construed to be a waiver of any such default or Event of Default or acquiescence therein; and every such right and power may be exercised from time to time and as often as may be deemed expedient.
No waiver of any default or Event of Default hereunder, whether by the Trustee or by the Bondholders, shall extend to or shall affect any subsequent default or Event of Default or shall impair any rights or remedies consequent thereon.
Section 10.4 Right of Bondholders to Direct Proceedings. Anything in this Indenture to the contrary notwithstanding, the holders of a majority in aggregate principal amount of Bonds outstanding hereunder shall have the right, at any time, by an instrument or instruments in writing executed and delivered to the Trustee, to direct the 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 proceeding hereunder; provided that such direction shall not be otherwise than in accordance with the provisions of law and of this Indenture.
Section 10.5 Appointment of Receiver. Upon the occurrence and continuance of an Event of Default, and upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the Trustee and of the Bondholders under this Indenture, the Trustee shall be entitled, as a matter of right, to the appointment of a receiver or receivers of the Trust Estate and of the tolls, rents, revenues, issues, earnings, income, products and profits thereof, pending such proceedings with such powers as the court making such appointment shall confer.
Secton 10.6 Waiver. In case of an Event of Default on the part of the Issuer, as aforesaid, to the extent that such rights may then lawfully be waived, neither the Issuer nor anyone claiming through it or under it shall or will set up, claim, or seek to take advantage of any appraisement, valuation, stay, extension or redemption laws now or hereafter in force, in order to prevent or hinder the enforcement of this Indenture, but the Issuer, for itself and all who may claim through or under it, hereby waives, to the extent that it lawfully may do so, the benefit of all such laws and all right of appraisement and redemption to which it may be entitled under the laws of the State.
Section 10.7. Application of Moneys. Available moneys remaining after discharge of costs, charges and liens (including the reasonable fees, charges and expenses of the Trustee) prior to this Indenture shall be applied by the Trustee as follows:
(a)Unless the principal of all the Bonds shall have become due and payable, all such moneys shall be applied:
First: To the payment of all rebate payments owed to the United States of America under the Code;
Second: To the payment to the persons entitled thereto of all installments of interest then due, in the order of the maturity of the installments of such interest, and, if the amount available shall not be sufficient to pay in full any particular installment, then to the payment ratably, according to the amounts due on such installment, to the persons entitled thereto, without any discrimination or privilege;
Third: To the payment to the persons entitled thereto of the unpaid principal of any of the Bonds which shall have become due (other than Bonds called for redemption for the payment of which moneys are held pursuant to the provisions of this Indenture), in the order of their due dates, with interest on such Bonds from the respective dates upon which they become due, and, if the amount available shall not be sufficient to pay in full Bonds due on any particular date, together with such interest, then to the payment ratably, according to the amount of principal due on such date, to the persons entitled thereto without any
discrimination or privilege of any Bond over any other Bond and without preference or priority of principal over interest or of interest over principal; and
Fourth: To the payment of the interest on and the principal of the Bonds, and to the redemption of Bonds, all in accordance with the provisions of Article V of this Indenture.
(a)If the principal of all the Bonds shall have become due and payable, all such moneys shall be applied to the payment of the principal and interest then due and unpaid upon the Bonds, without preference or priority of principal over interest or of interest over principal, or of any Bond over any other Bond, ratably, according to the amounts due respectively for principal and interest, to the persons entitled thereto without discrimination or privilege.
(b)If the principal of all the Bonds shall have become due and payable, and if acceleration of the maturity of the Bonds by reason of an Event of Default shall thereafter have been rescinded and annulled under the provisions of this Article, then, subject to the provisions of paragraph (b) of this Section in the event that the principal of all the Bonds shall later become due and payable, the moneys shall be applied in accordance with the provisions of paragraph (a) of this Section.
Whenever moneys are to be applied by the Trustee pursuant to the provisions of this Section, such moneys shall be applied by it at such times, and from time to time, as it shall determine, 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. Whenever the Trustee shall apply such funds, it shall fix the date (which shall be an interest payment date unless it shall deem another date more suitable) upon which such application is to be made and upon such date interest on the amounts of principal paid on such date shall cease to accrue. The Trustee shall give such notice as it may deem appropriate of the deposit with it of any such moneys and of the fixing of any such date and shall not be required to make payment to the holder of any Bond until such Bond shall be presented to the Trustee for appropriate endorsement or for cancellation if fully paid.
Section 10.8. Remedies Vested in Trustee. All rights of action (including the right to file proof of claim) 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 proceeding relating thereto and any such suit or proceeding instituted by the Trustee shall be brought in its name as Trustee, without the necessity of joining as plaintiffs or defendants any holders of the Bonds hereby secured, and any recovery of judgment shall be for the ratable benefit of the holders of the outstanding Bonds.
Section 10.9 Rights and Remedies of Bondholders. No holder of any Bond 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 hereof or for the appointment of a receiver or any other remedy hereunder, unless a default has occurred of which the Trustee has been notified as provided in subsection (g) of Section 11.1, or of which by said subsection it is deemed to have
notice, nor unless such default shall have become an Event of Default and the holders of a majority in aggregate principal amount of Bonds outstanding hereunder shall have made written request to the Trustee and 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, nor unless also they have offered to the Trustee satisfactory indemnity as provided in Section 11.1, nor unless also the Trustee shall thereafter fail or refuse to exercise the powers hereinbefore granted, or to institute such action, suit or proceeding in its own name; and such notification, request and offer of indemnity are hereby declared in every such 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 holders of the Bonds shall have any right in any manner whatsoever to affect, disturb or prejudice the lien of this Indenture by 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, held and maintained in the manner herein provided for the equal benefit of the holders of all Bonds outstanding hereunder. Nothing in this Indenture contained shall, however, affect or impair the right of any Bondholders to enforce the payment of the principal of and interest on any Bonds at and after the maturity thereof, or the obligation of the Issuer to pay the principal of and interest on each of the Bonds issued hereunder to the respective holders thereof at the time and place in said Bonds expressed.
Section 10.10 Termination of Proceedings. In case the Trustee shall have proceeded to enforce any right under this Indenture by the appointment of a receiver or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee, then and in every such case the Issuer and the Trustee shall be restored to their former positions and rights hereunder with respect to the property herein conveyed, and all rights, remedies and powers of the Trustee shall continue as if no such proceedings had been taken, except to the extent the Trustee is legally bound by such adverse determination.
Section 10.11. Waivers of Events of Default. To the extent not precluded by law, the Trustee may in its discretion waive any Event of Default hereunder and its consequences and rescind any declaration of maturity of principal, and shall do so upon the written request of the holders of not less than a majority in aggregate principal amount of all the Bonds then outstanding; provided, however, that there shall not be waived (a) any Event of Default in the payment of the principal or premium, if any, of any outstanding Bonds at the date of maturity specified therein or the date fixed for redemption thereof or (b) any Event of Default in the payment when due of interest on any such Bonds, unless prior to such waiver or rescission, all arrears of interest, or all arrears of payment of principal then due, as the case may be, together with interest on overdue principal (to the extent permitted by law) at the rate of interest borne by the respective Bonds, and all Administration Expenses of the Trustee in connection with such Event of Default shall have been paid or provided for, and in case of any such waiver or rescission, or in case any proceeding taken by the Trustee on account of any such Event of Default shall have been discontinued or abandoned or determined adversely, then and in every such case the Issuer, the Trustee and the Bondholders shall be restored to their former positions
and rights hereunder, respectively, but no such waiver or rescission shall extend to any subsequent or other Event of Default, or impair any right consequent thereon.
Section 10.12 Waiver Under the Company Mortgage. The provisions of this Article X are subject to the condition that any waiver of any "Event of Default" under the Company Mortgage and a rescission and annulment of its consequences shall constitute a waiver of the corresponding Event or Events of Default under clause (c) of Section 10.1 hereof and a rescission and annulment of the consequences thereof, but no such waiver, rescission and annulment shall extend to or affect any subsequent Event of Default or impair any right or remedy consequent thereon.
ARTICLE XI
THE TRUSTEE AND PAYING AGENTS
Section 11.1 Acceptance of Trusts. The Trustee hereby accepts the trust imposed upon it by this Indenture, and agrees to perform said trust (i) except during the continuance of an Event of Default as an ordinarily prudent trustee under a corporate mortgage, and (ii) during the continuance of an Event of Default, with the same degree of care and skill in the exercise of its rights hereunder as a prudent corporate trustee would exercise or use under the circumstances in the conduct of its affairs, but only upon and subject to the following expressed terms and conditions:
(a)The Trustee may execute any of the trusts or powers hereof and perform any duties required of it by or through attorneys, agents, receivers or employees, and shall be entitled to advice of counsel concerning all matters of trusts hereof and its duties hereunder, and may in all cases pay reasonable compensation to all such attorneys, agents, receivers and employees as may reasonably be employed in connection with the trusts hereof. The Trustee may act upon the opinion or advice of any attorney, surveyor, engineer or accountant selected by it in the exercise of reasonable care, or, if selected or retained by the Issuer prior to the occurrence of a default of which the Trustee has been notified as provided in subsection (g) of this Section 11.1, or of which by said subsection the Trustee is deemed to have notice, approved by the Trustee in the exercise of such care. The Trustee shall not be responsible for any loss or damage resulting from an action or non-action in accordance with any such opinion or advice.
(b)The Trustee shall not be responsible for any recital herein, or in the Bonds (except in respect to the certificate of the Trustee endorsed on such Bonds), or for insuring the Facilities or collecting any insurance moneys, or for the validity of the execution by the Issuer of this Indenture or of any supplemental indentures or instrument of further assurance, or for the sufficiency of the security for the Bonds issued hereunder or intended to be secured hereby, or for the use of the proceeds of the Bonds paid out in accordance with the provisions of this Indenture, or for any offering materials used in connection with the sale of the Bonds, or for the recording or filing of any financing statements or continuation statements in connection with the Bonds, this Indenture or the Loan Agreement, or for the value of the title of the property herein conveyed or otherwise as to the maintenance of the security hereof; except that in the event the Trustee enters into possession of a part or all of the property herein conveyed pursuant to any provision of this Indenture, it shall use due diligence in preserving such property; and the Trustee shall not be bound to ascertain or inquire as to the performance or observance of any covenants, conditions and agreements aforesaid as to the condition of the Facilities. The Trustee shall have no obligation to risk or expend its own funds in connection with the administration of the trusts or the performance of its duties hereunder.
(c)The Trustee (not in its capacity as trustee) may become the owner of Bonds secured hereby with the same rights which it would have if not Trustee.
(d)The Trustee shall be protected in acting upon any notice, request, consent, certificate, order, affidavit, letter, telegram or other paper or document believed by it, in the exercise of reasonable care, to be genuine and correct and to have been signed 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 the owner of any Bond secured hereby, shall be conclusive and binding upon all future owners of the same Bond and upon Bonds issued in exchange therefor or in place thereof.
(e)As to the existence or non-existence of any fact or as to the sufficiency or validity of any instrument, paper or proceeding, the Trustee shall be entitled to rely upon a certificate of the Issuer signed by the Chairman, the Vice Chairman, Executive Director, the Secretary or an Assistant Secretary of the Issuer, as sufficient evidence of the facts therein contained and prior to the occurrence of a default of which it has been notified as provided in subsection (g) of this Section 11.1, or of which by that subsection it is deemed to have notice, and 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, at the reasonable expense of the Issuer, in every case secure such further evidence as it may think necessary or advisable but shall in no case be bound to secure the same. The Trustee may accept a certificate of an Assistant Secretary of the Issuer to the effect that a resolution in the form therein set forth has been adopted by the Issuer as conclusive evidence that such resolution has been duly adopted, and is in full force and effect.
(f)The permissive right of the Trustee to do things enumerated in this Indenture shall not be construed as a duty of the Trustee.
(g)The Trustee shall not be required to take notice or be deemed to have notice of any default hereunder (except a default under Section 10.1(a) or (b) hereof concerning which the Trustee shall be deemed to have notice) unless the Trustee shall be specifically notified in writing of such default by the Issuer or by the holders of a majority in aggregate principal amount of Bonds outstanding hereunder and all notices or other instruments required by this Indenture to be delivered to the Trustee must, in order to be effective, be delivered to the office of the Trustee, and in the absence of such notice so delivered, the Trustee may conclusively assume there is no such default except as aforesaid.
(h)The Trustee shall not be personally liable for any debts contracted or for damages to persons or to personal property injured or damaged, or for salaries or non-fulfillment of contracts during any period in which it may be in the possession of or managing the real and tangible personal property as in this Indenture provided.
(i)At any and all reasonable times the Trustee, and its duly authorized agents, attorneys, experts, engineers, accountants and representatives, shall have the right fully to inspect any and all of the property herein conveyed, including all books, papers and records of the Issuer pertaining to the Facilities and the Bonds, and to take such memoranda from and in regard thereto as may be desired, provided, however, that nothing contained in this subsection or in any other provision of this Indenture shall be construed to entitle the above named persons to any information or inspection involving the confidential know-how or expertise or proprietary secrets of the Company.
(j)The Trustee shall not be required to give any bond or surety in respect of the execution of the said trusts and powers or otherwise in respect of the premises.
(k)Notwithstanding anything elsewhere in this Indenture contained, the Trustee shall have the right, but shall not be required, to demand, in respect of the authentication of any Bonds, the withdrawal of any cash, the release of any property, or any action whatsoever within the purview of this Indenture, any showings, certificates, opinions, appraisals, or other information, or corporate action or evidence thereof, in addition to that by the 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, the release of any property, or the taking of any other action by the Trustee. Before taking such action hereunder, the Trustee may require that it be furnished an indemnity bond satisfactory to it for the reimbursement to it of all expenses to which it may be put and to protect it against all liability, except liability which is adjudicated to have resulted from the negligence or willful misconduct of the Trustee, by reason of any action so taken by the Trustee.
Section 11.2 Fees, Charges and Expenses of Trustee and Paying Agents. The Trustee and any Paying Agent shall be entitled to payment and/or reimbursement for reasonable fees, costs and expenses for services rendered hereunder and all advances, counsel fees and other fees, costs and expenses reasonably and necessarily made or incurred in and about the execution of the trusts created by this Indenture. The Issuer has made provisions in the Loan Agreement for the payment of such Administration Expenses and reference is hereby made to the Loan Agreement for the provisions so made. In this regard, it is understood that the Issuer pledges no funds or revenues other than those derived from and the avails of the Trust Estate to the payment of any obligation of the Issuer set forth in this Indenture, including the obligations set forth in this Section 11.2, but nothing herein shall be construed as prohibiting the Issuer from using any other funds and revenues for the payment of any of its obligations under this Indenture. Upon an Event of Default, but only upon an Event of Default, the Trustee and the Paying Agent shall have a first lien with right of payment prior to payment on account of principal or interest of any Bond issued hereunder upon the Trust Estate for such reasonable and necessary advances, fees, costs and expenses incurred by them respectively.
Section 11.3 Notice to Bondholders of Default. The Trustee shall be required to make demand upon and give notice to the Company and each registered owner of Bonds then outstanding as follows:
(a)If the Company shall fail to make any payment under the Loan Agreement on the day such payment is due and payable, the Trustee shall give notice to and make demand upon the Company on the next succeeding business day.
(b)If a default occurs of which the Trustee is pursuant to the provisions of Section 11.1(g) deemed to have or is given notice, the Trustee shall promptly give notice to the Company and to the Bondholders.
Section 11.4 Intervention by Trustee. In any judicial proceeding that names the Issuer as a party and that in the opinion of the Trustee and its counsel has a substantial bearing on
the interests of holders of Bonds issued hereunder, the Trustee may intervene on behalf of Bondholders and shall do so if requested in writing by the holders of a majority of the aggregate principal amount of Bonds outstanding hereunder. The rights and obligations of the Trustee under this Section 11.4 are subject to the approval of the court having jurisdiction in the premises.
Section 11.5 Merger or Consolidation of Trustee. Any bank or trust company with which the Trustee may be merged, or with which it may be consolidated, or to which it may sell or transfer its trust business and assets as a whole or substantially as a whole, or any bank or trust company resulting from any such sale, merger, consolidation or transfer to which the Trustee is a party, ipso facto, shall be and become successor trustee hereunder and vested with all of the title to the whole property or Trust Estate and all the trusts, powers, discretions, immunities, privileges, and all other matters as was its predecessor, without the execution or filing of any instrument or any further act, deed or conveyance on the part of any of the parties hereto, anything herein to the contrary notwithstanding; provided, however, that such successor trustee shall have capital and surplus of at least $50,000,000.
Section 11.6 Resignation by Trustee. The Trustee and any successor trustee may at any time resign from the trusts hereby created by giving thirty (30) days' written notice to the Issuer and to the Company, and such resignation shall take effect at the end of such thirty (30) days, or upon the earlier appointment of a successor trustee by the Bondholders or by the Issuer. Such notice may be served personally or sent by registered mail.
Section 11.7 Removal of Trustee. The Trustee may be removed at any time by an instrument or concurrent instruments in writing delivered to the Trustee and to the Issuer, and signed by the holders of a majority in aggregate principal amount of Bonds outstanding hereunder. The transfer of accounts and funds to a successor trustee shall not be required to take place sooner than 31 days from notice to Trustee.
Section 11.8 Appointment of Successor Trustee. In case the Trustee hereunder shall resign or be removed, or be dissolved, or shall be in course of dissolution or liquidation, or otherwise become incapable of acting hereunder, or in case it shall be taken under the control of any public officer or officers, or of a receiver appointed by the court, a successor may be appointed by the holders of a majority in aggregate principal amount of Bonds outstanding hereunder, by an instrument or concurrent instruments in writing signed by such holders, or by their attorneys in fact, duly authorized; provided, nevertheless, that in case of such vacancy the Issuer, subject to the approval of the Company, by an instrument executed and signed by the Executive Director, the Secretary or an Assistant Secretary of the Issuer, shall appoint a temporary trustee to fill such vacancy until a successor trustee shall be appointed by the Bondholders in the manner above provided; and any such temporary trustee so appointed by the Issuer shall immediately and without further act be superseded by the trustee so appointed by such Bondholders. Every such temporary trustee and every such successor trustee shall be a trust company or bank in good standing, having capital and surplus of not less than $50,000,000.
If no appointment of a successor trustee shall be made pursuant to the foregoing provisions of this Section within 60 days after the Trustee shall have given the Issuer written
notice as provided in Section 11.6 or after a vacancy in the office of Trustee shall have occurred by removal or otherwise, the Trustee or a Bondholder may apply to any court of competent jurisdiction to appoint a successor trustee. Said Court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor trustee.
Section 11.9 Concerning Any Successor Trustee. Every successor or temporary trustee appointed hereunder shall execute, acknowledge and deliver to its predecessor and also to the Issuer an instrument in writing accepting such appointment hereunder, and thereupon such successor or temporary trustee, without any further act or conveyance, shall become fully vested with all the estates, properties, rights, powers, trusts, duties and obligations of its predecessor; but such predecessor shall, nevertheless, on the written request of the Issuer or of its successor trustee, execute and deliver an instrument transferring to such successor all the estate, properties, rights, powers and trusts of such predecessor hereunder; and every predecessor trustee shall deliver all securities, moneys and any other property 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 estates, rights, powers and duties hereby vested or intended to be vested in the predecessor trustee, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Issuer. The resignation of any trustee and the instrument or instruments removing any trustee and appointing a successor hereunder, together with all other instruments provided for in this Article shall, at the expense of the Issuer, be forthwith filed and/or recorded by the successor trustee in each recording office where the Indenture shall have been filed and/or recorded.
Section 11.10 Reliance Upon Instruments. The resolutions, opinions, certificates and other instruments provided for in this Indenture may be accepted and relied upon by the Trustee as conclusive evidence of the facts and conclusions stated therein and shall be full warrant, protection and authority to the Trustee for its actions taken hereunder.
Section 11.11 Appointment of Co-Trustee. The Issuer and the Trustee shall have power to appoint and upon the request of the Trustee the Issuer shall for such purpose join with the Trustee in the execution of all instruments necessary or proper to appoint another corporation or one or more persons approved by the Trustee, and satisfactory to the Company so long as there is no termination of the interest of the Company by virtue of an Event of Default or otherwise, either to act as co-trustee or co-trustees jointly with the Trustee of all or any of the property subject to the lien hereof, or to act as separate trustee or co-trustee of all or any such property, with such powers as may be provided in the instrument of appointment and to vest in such corporation or person or persons as such separate trustee or co-trustee any property, title, right or power deemed necessary or desirable. In the event that the Issuer shall not have joined in such appointment within fifteen (15) days after the receipt by it of a request so to do, the Trustee alone shall have the power to make such appointment. Should any deed, conveyance or instrument in writing from the Issuer be required by any separate trustee or co-trustee so appointed for more fully and certainly vesting in and confirming to him or to it such properties, rights, powers, trusts, duties and obligations, any and all such deeds, conveyances and instruments in writing shall, on request, be executed, acknowledged and delivered by the Issuer.
Every such co-trustee and separate trustee shall, to the extent permitted by law, be appointed subject to the following provisions and conditions, namely:
(1) The Bonds shall be authenticated and delivered, and all powers, duties, obligations and rights conferred upon the Trustee in respect of the custody of all money and securities pledged or deposited hereunder shall be exercised, solely by the Trustee; and
(2) The Trustee, at any time by an instrument in writing, may remove any such separate trustee or co-trustee.
Every instrument, other than this Indenture, appointing any such co-trustee or separate trustee, shall refer to this Indenture and the conditions of this Article expressed, and upon the acceptance in writing by such separate trustee or co-trustee, he, they or it shall be vested with the estate or property specified in such instrument, jointly with the Trustee (except insofar as local law makes it necessary for any separate trustee to act alone), subject to all the trusts, conditions and provisions of this Indenture. Any such separate trustee or co-trustee may at any time, by an instrument in writing, constitute the Trustee as his, their or its agent or attorney-in-fact with full power and authority, to the extent authorized by law, to do all acts and things and exercise all discretion authorized or permitted by him, them or it, for and on behalf of him, them or it and in his, their or its name. In case any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all the estate, properties, rights, powers, trusts, duties and obligations of said separate trustee or co-trustee shall vest in and be exercised by the Trustee until the appointment of a new trustee or a successor to such separate trustee or co-trustee.
Section 11.12 Designation and Succession of Paying Agents. The Trustee and any other banks or trust companies, if any, designated as Paying Agent or Paying Agents in any supplemental indenture providing for the issuance of Additional Bonds as provided in Section 2.11 hereof or in an instrument appointing a successor Trustee, shall be the Paying Agent or Paying Agents for the applicable series of Bonds.
Any bank or trust company with which or into which any Paying Agent may be merged or consolidated, or to which the assets and business of such Paying Agent may be sold, shall be deemed the successor of such Paying Agent for the purposes of this Indenture. If the position of Paying Agent shall become vacant for any reason, the Issuer shall, within thirty (30) days thereafter, appoint such bank or trust company as shall be specified by the Company as such Paying Agent to fill such vacancy; provided, however, that, if the Issuer shall fail to appoint such Paying Agent within said period, the Trustee shall make such appointment.
The Paying Agents shall enjoy the same protective provisions in the performance of their duties hereunder as are specified in Section 11.1 hereof with respect to the Trustee insofar as such provisions may be applicable.
Section 11.13 Several Capacities. Anything in this Indenture to the contrary notwithstanding, the same entity may serve hereunder as the Trustee, the Paying Agent, and the Bond Registrar and in any other combination of such capacities, to the extent permitted by law.
ARTICLE XII
SUPPLEMENTAL INDENTURES
Section 12.1 Supplemental Indentures Without Bondholder Consent. The Issuer and the Trustee may, from time to time and at any time, without the consent of or notice to the Bondholders, enter into supplemental indentures as follows:
(a)to cure any formal defect, omission, inconsistency or ambiguity in this Indenture;
(b)to grant to or confer or impose upon the Trustee for the benefit of the bondholders any additional rights, remedies, powers, authority, security, liabilities or duties which may lawfully be granted, conferred or imposed and which are not contrary to or inconsistent with this Indenture as theretofore in effect, provided that no such additional liabilities or duties shall be imposed upon the Trustee without its consent;
(c)to add to the covenants and agreements of, and limitations and restrictions upon, the Issuer in this Indenture other covenants, agreements, limitations and restrictions to be observed by the Issuer which are not contrary to or inconsistent with this Indenture as theretofore in effect;
(d)to confirm, as further assurance, any pledge under, and the subjection to any claim, lien or pledge created or to be created by, this Indenture, of the Revenues of the Issuer from the Loan Agreement or of any other moneys, securities or funds;
(e)to authorize the issuance and sale of one or more series of Additional Bonds;
(f)to comply with the requirements of the Trust Indenture Act of 1939, as from time to time amended;
(g)to provide for the registration and registration of transfer of the Bonds through a book-entry or similar method, whether or not the Bonds are evidenced by certificates;
(h)to modify, alter, amend or supplement this Indenture in any other respect which is not materially adverse to the Bondholders and that does not involve a change described in clause (a), (b), (c), (d), (e) or (f) of Section 12.2 hereof and that, in the judgment of the Trustee, is not to the prejudice of the Trustee; or
(i)to make changes as may be necessary to comply with the provisions of the 1954 Code and the Code relating to the excludability of interest on the Bonds from gross income thereon that are not materially adverse to the Bondholders.
Section 12.2 Supplemental Indentures Requiring Bondholder Consent.
Subject to the terms and provisions contained in this Section, and not otherwise, the holders of a majority 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 indenture or indentures supplemental hereto as shall be deemed necessary and desirable by the Issuer for the purpose of modifying, altering, 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 nothing herein contained shall permit, or be construed as permitting, unless approved by the holders of all Bonds then outstanding (a) an extension of the maturity (or mandatory sinking fund or other mandatory redemption date) of the principal of or the interest on any Bond issued hereunder, or (b) a reduction in the principal amount of or redemption premium or rate of interest on any Bond issued hereunder, or (c) the creation of any lien ranking prior to or on a parity with the lien of this Indenture on the Trust Estate or any part thereof, except as hereinbefore expressly permitted, or (d) a privilege or priority of any Bond or Bonds over any other Bond or Bonds, or (e) a reduction in the aggregate principal amount of the Bonds required for consent to such supplemental indenture, or (f) depriving the holder of any Bond then outstanding of the lien hereby created on the Trust Estate. Nothing herein contained, however, shall be construed as making necessary the approval of Bondholders of the execution of any supplemental indenture as provided in Section 12.1 of this Article.
If at any time the Issuer shall request the Trustee to enter into any supplemental indenture for any of the purposes of this Section, the Trustee shall, at the expense of the Issuer, cause notice of the proposed execution of such supplemental indenture to be mailed by first class mail to each registered owner of the Bonds. Such notice shall briefly set forth the nature of the proposed supplemental indenture and shall state that copies thereof are on file at the principal corporate trust office of the Trustee for inspection by Bondholders. The Trustee shall not, however, be subject to any liability to any Bondholder by reason of its failure to mail such notice, and any such failure shall not affect the validity of such supplemental indenture when consented to and approved as provided in this Section. If the holders of a majority in aggregate principal amount of the Bonds outstanding at the time of the execution of any such supplemental indenture shall have consented to and approved the execution thereof as herein provided, no holder of any Bond shall have any right to object to any of the terms and provisions contained therein, or the operation thereof, or in any manner to question the propriety of the execution thereof, or to enjoin or restrain the Trustee or the Issuer from executing the same or from taking any action pursuant to the provisions thereof. Upon the execution of any such supplemental indenture, this Indenture shall be deemed to be modified and amended in accordance therewith.
Section 12.3 Consent of Company. Anything herein to the contrary notwithstanding, a supplemental indenture under this Article shall not become effective unless and until the Company shall have consented to the execution and delivery of such supplemental indenture.
Section 12.4 Opinion of Bond Counsel. Anything herein to the contrary notwithstanding, a supplemental indenture under this Article shall not become effective unless and until the Trustee shall have received an opinion of Bond Counsel to the effect that such supplemental indenture will not affect the exclusion of interest on the Bonds from gross income
for purposes of federal income taxation and is authorized or permitted under the terms of this Indenture.
ARTICLE XIII
AMENDMENT OF LOAN AGREEMENT
Section 13.1 Amendments with and Without the Consent of Bondholders. The Trustee may from time to time, and at any time, consent to any amendment, change or modification of the Loan Agreement for the purpose of curing any ambiguity or formal defect or omission or making any other change therein which, in the reasonable judgment of the Trustee, is not to the prejudice of the Trustee or the holders of the Bonds. The Trustee shall not consent to any other amendment, change or modification of the Loan Agreement without the approval or consent of the holders of a majority in aggregate principal amount of the Bonds at the time outstanding, evidenced in the manner provided in Section 14.1 hereof; provided the Trustee shall not, without the unanimous consent of the holders of all Bonds then outstanding, evidenced in the manner provided in Section 14.1 hereof, consent to any amendment which would change the obligations of the Company under Section 5.2 of the Loan Agreement or the nature of the obligations of the Company in respect of the First Mortgage Bonds as provided in Section 5.9 of the Loan Agreement.
Section 13.2 Notice to Bondholders. If at any time the Issuer or the Company shall request the Trustee's consent to a proposed amendment, change or modification of the Loan Agreement requiring Bondholder approval under Section 13.1 hereof, the Trustee, shall, at the expense of the requesting party, cause notice of such proposed amendment, change or modification to the Loan Agreement to be mailed in the same manner as provided by Section 12.2 hereof with respect to supplemental indentures. Such notice shall briefly set forth the nature of such proposed amendment, change or modification and shall state that copies of the instrument embodying the same are on file in the principal office of the Trustee for inspection by any interested bondholder. The Trustee shall not, however, be subject to any liability to any Bondholder by reason of its failure to publish or mail such notice, and any such failure shall not affect the validity of such amendment, change or modification when consented to by the Trustee in the manner herein provided.
Section 13.3 Opinion of Bond Counsel. Anything herein to the contrary notwithstanding, any amendment to the Loan Agreement shall not become effective unless and until the Trustee shall have received an opinion of Bond Counsel to the effect that such amendment will not affect the exclusion of interest on the Bonds from gross income for purposes of federal income taxation.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Consents, etc. of Bondholders. Any request, direction, objection or other instrument required by this Indenture to be signed and executed by the Bondholders may be in any number of concurrent writings of similar tenor and may be signed or executed by such Bondholders in person or by agent appointed in writing. Proof of the execution of any such request, direction, objection or other 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 by it under such request or other instrument, namely:
(a)The fact and date of the execution by any person of any such writing 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 writing acknowledged before him the execution thereof, or by an affidavit of any witness to such execution.
(b)The fact of ownership of Bonds and the amount or amounts, numbers 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 as Bond Registrar.
Section 14.2 Limitation of Rights. With the exception of rights herein expressly conferred, nothing expressed or mentioned in or to be implied from this Indenture, or the Bonds issued hereunder, is intended or shall be construed to give to any person or company other than the parties hereto, the Company, and the holders of the Bonds secured by this Indenture any legal or equitable rights, remedy or claim under or in respect to this Indenture or any covenants, conditions and provisions herein contained; 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 Company, and the holders of the Bonds hereby secured as herein provided.
Section 14.3 Severability. If any provisions of this Indenture shall be held or deemed to be or shall, in fact, be 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 provisions of 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, circumstance or jurisdiction, or of rendering any other provision or provisions herein contained invalid, inoperative or unenforceable to any extent whatever.
The invalidity of any one or more phrases, sentences, clauses or paragraphs in this Indenture contained shall not affect the remaining portions of this Indenture or any part thereof.
Section 14.4 Notices. Except as otherwise provided in this Indenture, all notices, certificates or other communications shall be sufficiently given and shall be deemed given when mailed by registered or certified mail, postage prepaid, to the Issuer, the Company, the Trustee and any Paying Agent. Notices, certificates or other communications shall be sent to the following addresses:
Company: System Energy Resources, Inc.
639 Loyola Avenue
New Orleans, LA 70113
ATTN: Steven C. McNeal, Vice President and Treasurer
Phone: 504-576-4363
Email: smcneal@entergy.com
Issuer: Mississippi Business Finance Corporation
735 Riverside Drive, Ste. 300
Jackson, MS 39202
ATTN: E. F. "Buddy" Mitcham, Executive Director
Phone: 601-355-6232
Email: bmitcham@mbfc.cc
Trustee and
Bond Registrar: The Bank of New York Mellon
Corporate Trust Division
4655 Salisbury Road, Suite 300
Jacksonville, FL 32256
ATTN: Cindy Moore, Vice President
Phone: 904-645-1943
Email: cindy.moore@bnymellon.com
Any Paying
Agent other
than the
Trustee: At the address designated to the Issuer and the Trustee
Any of the foregoing may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent.
Section 14.5 Applicable Provisions of Law. This Indenture shall be considered to have been executed in the State, and it is the intention of the parties that the substantive law of the State govern as to all questions of interpretation, validity and effect.
Section 14.6 Counterparts: Electronic Signatures. This Indenture may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. The words "execution," "signed" and "signature" and words of like import in this Indenture or in any other certificate, agreement or document related to this Indenture (to the extent permissible under governing documents) shall include images of manually executed signatures transmitted by facsimile or other electronic format (including, without limitation, "pdf," "tif" or "jpg") and other electronic signatures (including, without limitation, DocuSign and AdobeSign). The use of electronic signatures and electronic records (including, without limitation, any contract or other record created, generated, sent, communicated, received or stored by electronic means) shall be of the same legal effect, validity and enforceability as a manually executed signature or use of a paper-based record-keeping
system to the fullest extent permitted by applicable law, including, without limitation, the Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act and any other applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act or the Uniform Commercial Code.
Section 14.7 Successors and Assigns. All the covenants, stipulations, provisions, agreements, rights, remedies and claims of the parties hereto in this Indenture contained shall bind and inure to the benefit of their successors and assigns.
Section 14.8 Captions. The captions or headings in this Indenture are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Indenture.
Section 14.9 Bonds Owned by the Issuer or the Company. In determining whether Bondholders of the requisite aggregate principal amount of the Bonds have concurred in any direction, consent or waiver under this Indenture, Bonds which are owned by the Issuer or the Company or by any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company shall be disregarded and deemed not to be outstanding for the purpose of any such determination, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver, only Bonds that a responsible officer of the Trustee knows are so owned shall be so disregarded. Bonds so owned that have been pledged in good faith may be regarded as outstanding 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 Issuer or the Company or any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee.
Section 14.10 Holidays. If the date for making any payment or the last date for performance of any act or the exercising of any right, as provided in this Indenture, shall be a legal holiday or a day on which banking institutions in the city in which is located the designated corporate trust office of the Trustee are authorized by law to remain closed, such payment may be made or act performed or right exercised on the next succeeding day not a legal holiday or a day on which such banking institutions are authorized by law to remain closed, with the same force and effect as if done on the nominal date provided in this Indenture, and no interest on the amount so payable shall accrue for the period after such nominal date.
Section 14.11 Trustee Reliance on Instructions Given by Electronic Means. "Electronic Means" shall mean the following communications methods: e-mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Trustee, or another method or system specified by the Trustee as available for use in connection with its services hereunder.
The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions ("Instructions") given pursuant to this Indenture and related financing
documents and delivered using Electronic Means; provided, however, that the Issuer and/or the Company, as applicable, shall provide to the Trustee an incumbency certificate listing officers with the Issuer and/or the Company, as applicable, to provide such Instructions ("Authorized Officers") and containing specimen signatures of such Authorized Officers, which incumbency certificate shall be amended by the Issuer and/or the Company, as applicable, whenever a person is to be added or deleted from the listing. If the Issuer and/or the Company, as applicable, elects to give the Trustee Instructions using Electronic Means and the Trustee in its discretion elects to act upon such Instructions, the Trustee’s understanding of such Instructions shall be deemed controlling. The Issuer and the Company understand and agree that the Trustee cannot determine the identity of the actual sender of such Instructions and that the Trustee shall conclusively presume that directions that purport to have been sent by an Authorized Officer listed on the incumbency certificate provided to the Trustee have been sent by such Authorized Officer. The Issuer and the Company shall be responsible for ensuring that only Authorized Officers transmit such Instructions to the Trustee and that the Issuer, the Company and all Authorized Officers are solely responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the Issuer and/or the Company, as applicable. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such Instructions notwithstanding such directions conflict or are inconsistent with a subsequent written instruction. Each of the Issuer and the Company agrees: (i) to assume all risks arising out of the use of Electronic Means by the Issuer or the Company, as applicable, to submit Instructions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized Instructions, and the risk of interception and misuse by third parties; (ii) that each of them is fully informed of the protections and risks associated with the various methods of transmitting Instructions to the Trustee and that there may be more secure methods of transmitting Instructions than the method(s) selected by the Issuer and/or the Company, as applicable; (iii) that the security procedures (if any) to be followed in connection with each of their transmission of Instructions provide to each of them a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Trustee immediately upon learning of any compromise or unauthorized use by the Issuer or the Company, as applicable, of the security procedures.
[Signature Page to Trust Indenture]
IN WITNESS WHEREOF, the Issuer has caused this Indenture to be executed by its Executive Director and attested by the Secretary of the Issuer, and the Trustee has caused this Indenture to be executed on its behalf by a duly authorized officer, all as of the day and year above written.
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ATTEST:
By: /s/ Larry W. Mobley
Larry W. Mobley
Secretary
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MISSISSIPPI BUSINESS FINANCE CORPORATION
By: /s/ E.F. Buddy Mitcham, Jr.
E. F. Buddy Mitcham, Jr.
Executive Director
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THE BANK OF NEW YORK MELLON, as TRUSTEE
By: /s/ Rick Fierro
Name: Rick Fierro
Title: Vice President
EXHIBIT A TO
TRUST INDENTURE
FORM OF THE BOND
No. R-1 $83,695,000
Unless this Bond is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the Trustee, for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.
As provided in the Indenture referred to herein, until the termination of the system of book-entry-only transfers through DTC and notwithstanding any other provision of the Indenture to the contrary, this Bond may be transferred, in whole but not in part, only to a nominee of DTC, or by a nominee of DTC to DTC or a nominee of DTC, or by DTC or a nominee of DTC to any successor securities depository or any nominee thereof.
United States of America
State of Mississippi
Mississippi Business Finance Corporation
Revenue Refunding Bonds
(System Energy Resources, Inc. Project)
Series 2021
Date of Bond June 15, 2021 CUSIP 605279MK1
Maturity Date: June 1, 2044
Interest Rate: 2.375%
Registered Owner: Cede & Co.
Principal Amount: $83,695,000
The Mississippi Business Finance Corporation (the "Issuer"), public corporation duly created and validly existing pursuant to the constitution and laws of the State of Mississippi, for value received, hereby promises to pay to the registered owner shown above, or registered assigns, but solely from the source and in the manner hereinafter set forth, on the maturity date
shown above, upon surrender hereof, the principal amount shown above and in like manner to pay interest on said amount from the date hereof shown above until such principal amount becomes due and payable, at the interest rate per annum shown above, semiannually on June 1 and December 1 of each year, commencing December 1, 2021, and to pay interest on overdue principal at the interest rate set forth above until paid, except as the provisions hereinafter set forth with respect to redemption of this Bond prior to maturity may become applicable hereto. Interest is calculated on the basis of a 360-day year, consisting of twelve 30-day months. The principal of and premium, if any, on this Bond are payable in lawful money of the United States of America upon the presentation and surrender hereof at the principal corporate trust office of The Bank of New York Mellon, or its successor or successors, as trustee (the "Trustee") under the Trust Indenture dated as of June 1, 2021, by and between the Issuer and the Trustee (the "Indenture"), and interest on this Bond is payable in like money to the registered owner hereof by check drawn upon the Trustee and mailed to the person in whose name this Bond is registered at the close of business on the fifteenth day of the calendar month next preceding such interest payment date, at the address as it appears on the bond registration books of the Issuer kept by the Trustee.
This Bond is one of a duly authorized issue of revenue bonds of the Issuer issued in the aggregate principal amount of $83,695,000 designated "Mississippi Business Finance Corporation Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021" (the "Series 2021 Bonds") issued under the Indenture for the purpose of currently refunding $83,695,000 in aggregate principal amount of its Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2019 issued in the original principal amount of $134,000,000 which refunded its Pollution Control Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 1998 issued in the original principal amount of $216,000,000, which Series 1998 Bonds were issued for the purpose of providing funds to refinance the Company’s obligations incurred to finance the cost of acquiring an undivided 90% interest in certain air and water pollution control facilities and sewage and solid waste disposal facilities at the Grand Gulf Nuclear Station located in Claiborne County, Mississippi.
Pursuant to the provisions of a Loan Agreement dated as of June 1, 2021, by and between the Issuer and the Company (the "Agreement"), the Issuer will loan to the Company the proceeds derived from the sale of the Series 2021 Bonds for the purpose described above.
The Bonds are payable solely from and secured by a pledge of the Trust Estate, which includes, among other things, (i) the First Mortgage Bonds delivered by the Company pursuant to Section 5.9 of the Loan Agreement, (ii) the Thirty-ninth Assignment, (iii) all of the right, title and interest of the Issuer in and to the Revenues, including, without limitation, "Loan Payments" required to be made by the Company pursuant to the Agreement, (iv) the Agreement and all right, title and interest of the Issuer under and pursuant to the Agreement, insofar as they relate to all the Bonds issued and outstanding under the Indenture (except for the indemnification and expense reimbursement rights and other rights contained in the Agreement), including, without limitation, all payments to be received under and pursuant to and subject to the provisions of the Agreement, and (v) all amounts on deposit in the funds created under the Indenture. The obligation of the Company to make Loan Payments is evidenced by the
Company's First Mortgage Bonds issued and delivered to the Trustee in one or more series under the Company's Mortgage and Deed of Trust, dated as of November 1, 2015, made to The Bank of New York Mellon, as trustee, as heretofore and hereafter amended and supplemented. All the rights and interests of the Issuer under, in and to the Agreement (except for certain rights specified in the Indenture) have been assigned under the Indenture to the Trustee to secure the payment of the principal of and premium, if any, and interest on the Bonds.
THE BONDS ARE NOT A GENERAL OBLIGATION OF THE ISSUER AND ARE NOT AN INDEBTEDNESS OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF. NEITHER THE FAITH AND CREDIT OF THE ISSUER NOR THE FAITH AND CREDIT OR THE TAXING POWER OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF THE BONDS, OR PREMIUM, IF ANY, OR THE INTEREST THEREON OR OTHER COSTS INCIDENTAL THERETO. THE ISSUER HAS NO TAXING POWER.
The Series 2021 Bonds are all issued under and are all equally and ratably secured and entitled to the protection given by the Indenture. The Indenture provides that the Issuer may hereafter issue Additional Bonds from time to time under certain terms and conditions contained in the Indenture and, if issued, such Additional Bonds will be equally and ratably secured by and entitled to the protection of the Indenture. Reference is hereby made to the Indenture and all indentures supplemental thereto for the provisions, among others, with respect to the nature and extent of the security, the rights, duties and obligations of the Issuer, the Trustee and the registered owners of the Bonds, and the terms upon which the Bonds are issued and secured. Capitalized terms used herein and not defined herein shall have the meaning assigned thereto in the Indenture or in the Agreement.
The Bonds are limited and special obligations of the Issuer and do not constitute or create an obligation, general or special, debt, liability or moral obligation of the State or any political subdivision thereof within the meaning of any constitutional or statutory provisions whatsoever and neither the faith or credit nor the taxing power of the State or of any political subdivision thereof is pledged to the payment of the principal of or premium, if any, or the interest on the Bonds. The Bonds are not a general obligation of the Issuer (which has no taxing power and receives no funds from any governmental body) but are a limited and special revenue obligation of the Issuer payable solely out of the Trust Estate, including the Revenues. No recourse under this Bond shall be had against any past, present or future officer or trustee of the Issuer.
FOR SO LONG AS THIS BOND IS HELD IN BOOK-ENTRY FORM REGISTERED IN THE NAME OF CEDE & CO. ON THE REGISTRATION BOOKS OF THE ISSUER KEPT BY THE TRUSTEE, AS BOND REGISTRAR, THIS BOND, IF CALLED FOR PARTIAL REDEMPTION IN ACCORDANCE WITH THE INDENTURE, SHALL BECOME DUE AND PAYABLE ON THE REDEMPTION DATE DESIGNATED IN THE NOTICE OF REDEMPTION GIVEN IN ACCORDANCE WITH THE INDENTURE AT, AND ONLY TO THE EXTENT OF, THE REDEMPTION PRICE, PLUS ACCRUED INTEREST TO THE SPECIFIED REDEMPTION DATE; AND THIS BOND SHALL BE PAID, TO THE EXTENT SO REDEEMED, (i) UPON PRESENTATION AND SURRENDER THEREOF AT THE
OFFICE SPECIFIED IN SUCH NOTICE OR (ii) AT THE WRITTEN REQUEST OF CEDE & CO., BY CHECK OR DRAFT MAILED TO CEDE & CO. BY THE TRUSTEE OR BY WIRE TRANSFER TO CEDE & CO. BY THE TRUSTEE IF CEDE & CO. AS BONDOWNER SO ELECTS. IF, ON THE REDEMPTION DATE, MONEYS FOR THE REDEMPTION OF BONDS TO BE REDEEMED, TOGETHER WITH INTEREST TO THE REDEMPTION DATE, SHALL BE HELD BY THE TRUSTEE SO AS TO BE AVAILABLE THEREFOR ON SUCH DATE, AND AFTER NOTICE OF REDEMPTION SHALL HAVE BEEN GIVEN IN ACCORDANCE WITH THE INDENTURE, THEN, FROM AND AFTER THE REDEMPTION DATE, THE AGGREGATE PRINCIPAL AMOUNT OF THIS BOND SHALL BE IMMEDIATELY REDUCED BY AN AMOUNT EQUAL TO THE AGGREGATE PRINCIPAL AMOUNT THEREOF SO REDEEMED, NOTWITHSTANDING WHETHER THIS BOND HAS BEEN SURRENDERED TO THE TRUSTEE FOR CANCELLATION.
The owner of this Bond shall have no 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 and defend any suit or other proceeding 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 be declared and may become due and payable before the stated maturity thereof, together with accrued interest thereon.
Modifications or alterations of the Indenture, or of any indenture supplemental thereto, may be made only to the extent and in the circumstances permitted by the Indenture.
The Series 2021 Bonds are subject to redemption prior to maturity as follows:
(a) The Series 2021 Bonds shall be subject to mandatory redemption in whole, at a redemption price equal to 100% of the principal amount thereof being redeemed plus accrued interest thereon to the redemption date on the ninetieth day (or such earlier date as may be designated by the Company) after a Determination of Taxability (as defined in the Indenture). Subject to the preceding foregoing provisions of this paragraph (a), the Series 2021 Bonds shall be redeemed in whole unless, in the opinion of Bond Counsel, the redemption of a portion of the Series 2021 Bonds would have the result that interest payable on the Series 2021 Bonds remaining outstanding after such redemption would not be includable in the gross income for federal income tax purposes of any owner of any such Series 2021 Bonds. Any such partial redemption shall be in such amount as is necessary to accomplish such result.
(b) The Series 2021 Bonds are subject to optional redemption by the Issuer, at the written direction of the Company, at any time on and after June 1, 2026, in whole or in part (and if in part, by lot or in such other manner as may be determined by the Trustee to be fair and equitable), at a redemption price equal to 100% of the principal amount thereof plus accrued interest thereon to the redemption date.
(c) The Series 2021 Bonds are subject to special optional redemption by the Issuer, at the written direction of the Company, in whole but not in part, at any time, at a redemption price
equal to 100% of the principal amount thereof plus accrued interest thereon to the redemption date but without redemption premium if:
i.the Company shall have determined that the continued operation of the Plant is impracticable, uneconomical or undesirable for any reason;
ii.the Company shall have determined that the continued operation of the Facilities is impracticable, uneconomical or undesirable due to (1) the imposition of taxes, other than ad valorem taxes currently levied upon privately owned property used for the same general purpose as the Facilities, or other liabilities or burdens with respect to the Facilities or the operation thereof, (2) changes in technology, in environmental standards or legal requirements or in the economic availability of materials, supplies, equipment or labor or (3) destruction of or damage to all or part of the Facilities;
iii.all or substantially all of the Facilities or the Plant shall have been condemned or taken by eminent domain; or
iv.the operation of the Facilities or the Plant shall have been enjoined or shall have otherwise been prohibited by an order, decree, rule or regulation of any court or of any federal, state or local regulatory body, administrative agency or other governmental body.
In case a Series 2021 Bond is of a denomination larger than $5,000, a portion of such Bond ($5,000 or any integral multiple thereof) may be redeemed if otherwise permitted, but Series 2021 Bonds shall be redeemed only in the principal amount of $5,000 or any integral multiple thereof.
Notice of any redemption, identifying the Bonds or portions thereof being called and the date on which they shall be presented for payment, shall be given by the Trustee by first class mail, postage prepaid, to the registered owner of each such Bond addressed to such registered owner at his registered address and placed in the mails not less than thirty (30) days nor more than ninety (90) days prior to the date fixed for redemption; provided, however, that failure to give such notice by mailing, or any defect therein, shall not affect the validity of any proceeding for the redemption of any Bond with respect to which no such failure or defect has occurred. Any notice mailed as so provided shall be conclusively presumed to have been duly given, whether or not the holder or owner receives the notice.
With respect to notice of redemption of the Bonds at the option of the Issuer (at the direction of the Company), unless moneys sufficient to pay the principal of and premium, if any, and interest on the Bonds to be redeemed shall have been received by the Trustee prior to the giving of such notice, such notice shall state that said redemption shall be conditional upon the receipt of such moneys by the Trustee on or prior to the date fixed for such redemption. So long as Cede & Co. is the registered owner of the Bonds, as nominee of DTC, notice of any redemption will be given by the Trustee to Cede & Co., not to the beneficial owners of the Bonds, as set forth above or by email. If such moneys shall not have been so received, such notice shall be of no force and effect, the Issuer shall not redeem such Bonds and the Trustee
shall give notice, in the manner in which the notice of redemption was given, that such moneys were not so received.
The Bonds are issuable as registered Bonds without coupons in denominations of $5,000 and any integral multiple thereof. Subject to the limitations and upon payment of the charges provided in the Indenture, Bonds may be exchanged for a like aggregate principal amount of Bonds of other authorized denominations.
Bonds may be transferred on the books of registration kept by the Trustee by the registered owner in person or by his duly authorized attorney, upon surrender thereof, together with a written instrument of transfer duly executed by the registered owner or his duly authorized attorney in such form as shall be satisfactory to the Trustee. Upon surrender for transfer of any Bond at the principal corporate office of the Trustee, the Issuer shall execute and the Trustee shall authenticate and deliver in the name of the transferee or transferees a new Bond or Bonds in the same aggregate principal amount and of any authorized denomination or denominations.
This Bond is issued with the intent that the laws of the State of Mississippi will govern its construction. As declared by the Act and other applicable laws of the State of Mississippi, this Bond shall have all the qualities and incidents, including negotiability, of an investment security under the Uniform Commercial Code of the State of Mississippi.
This Bond 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 signed by the Trustee.
It is hereby certified, recited 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 this Bond do exist, have happened and have been performed in due time, form and manner as required by law; and that the issuance of this Bond and the issue of which it forms a part, together with all other obligations of the Issuer, does not exceed or violate any constitutional or statutory limitation.
IN WITNESS WHEREOF, the Issuer has caused this Bond to be executed in its name by the manual or facsimile signature of its Executive Director and attested by the manual or facsimile signature of its Secretary.
MISSISSIPPI BUSINESS FINANCE CORPORATION
By: _______________________________
Executive Director
ATTEST:
By: _____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds designated therein and described in the within-mentioned Indenture.
THE BANK OF NEW YORK MELLON,
as trustee
By: ______________________________
Authorized Signatory
Authentication Date: June 15, 2021
STATE OF MISSISSIPPI
COUNTY OF HINDS
The undersigned, Secretary of the Mississippi Business Finance Corporation, does hereby certify that the within Bond has been duly registered by me pursuant to law in a book kept in my office for that purpose; and that the within Bond has been validated by decree of the Chancery Court of the First Judicial District of Hinds County, Mississippi, rendered on the 1st day of June, 2021.
Secretary of the Mississippi Business Finance Corporation
ASSIGNMENT
For value received the undersigned hereby sells, assigns and transfers unto _________________________________ the within-mentioned Bond and all rights thereunder, and hereby irrevocably constitutes and appoints ____________________________________ to transfer the within Bond on the books kept for registration thereof, with full power of substitution in the premises.
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, without alteration or enlargement or any change whatever.
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Please Insert Social Security
or other Identifying Number of Assignee
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Exhibit 4(d)
Loan Agreement
Between
Mississippi Business Finance Corporation
And
System Energy Resources, Inc.
Dated as of June 1, 2021
$83,695,000
Mississippi Business Finance Corporation
Revenue Refunding Bonds
(System Energy Resources, Inc. Project)
Series 2021
TABLE OF CONTENTS
Exhibit A – Continuing Disclosure Agreement
LOAN AGREEMENT
This Loan Agreement dated as of June 1, 2021 (together with any amendments and supplements hereto, this "Agreement"), is between the Mississippi Business Finance Corporation (as more fully defined in Section 1.1 hereof, the "Issuer"), a public corporation duly created and validly existing pursuant to the constitution and laws of the State of Mississippi (the "State"), authorized to exercise the powers conferred by Sections 57-10-201 et seq., Mississippi Code of 1972, as amended and supplemented from time to time (the "Act") and System Energy Resources, Inc., a corporation organized and existing under the laws of the State of Arkansas, duly qualified to do business in the State (together with any permitted successors or assigns under this Agreement, the "Company").
W I T N E S S E T H:
WHEREAS, the Issuer is authorized by the provisions of the Act, among other things, to provide financial assistance to businesses in the State by providing loans, guarantees, insurance and other assistance to businesses, thereby encouraging the investment of private capital in businesses in the State, and to finance such assistance to businesses by the issuance of revenue bonds; and
WHEREAS, the Company has requested that the Issuer issue $83,695,000 of its Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021 (as more fully defined in Section 1.1 hereof, the "Series 2021 Bonds") for the purpose of currently refunding $83,695,000 in aggregate principal amount of its Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2019 issued in the original principal amount of $134,000,000 (the "Series 2019 Bonds") which refunded its Pollution Control Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 1998 (the "Series 1998 Bonds") issued in the original principal amount of $216,000,000, which Series 1998 Bonds were issued for the purpose of providing funds to refinance the Prior Bonds (as more fully defined in Section 1.1 hereof) issued to finance the cost of acquiring an undivided 90% interest in certain air and water pollution control facilities and sewage and solid waste disposal facilities (the "Facilities") at the Grand Gulf Nuclear Station located in Claiborne County, Mississippi (the "Plant"); and
WHEREAS, the Issuer may authorize and issue Additional Bonds (as defined in Section 1.1 of this Agreement) pursuant to Section 2.11 of the Trust Indenture dated as of June 1, 2021 (as more fully defined in Section 1.1 hereof, the "Indenture") by and between the Issuer and The Bank of New York Mellon, as trustee (as more fully defined in Section 1.1 hereof, the "Trustee"), and Section 4.2 of this Agreement; and
WHEREAS, in consideration of the issuance of the Bonds (as defined in Section 1.1 of this Agreement) by the Issuer, the Company will agree to make payments in an amount sufficient to pay the principal of, premium, if any, and interest on the Bonds pursuant to this Agreement, said Bonds to be paid solely from the Revenues (as defined in Section 1.1 of this Agreement), and said Bonds shall not constitute an indebtedness or pledge of the general credit of the Issuer or the State, within the meaning of any constitutional or statutory limitation of indebtedness or otherwise; and
WHEREAS, the execution and delivery of this Agreement under the Act have been in all respects duly and validly authorized by resolution duly adopted by the Issuer on May 12, 2021;
NOW, THEREFORE, in consideration of the premises and other good and valuable consideration and the mutual benefits, covenants and agreements herein expressed, the Issuer and the Company agree as follows (provided that any obligation of the Issuer created by or arising out of this Agreement shall not impose a debt or pecuniary liability upon the State or any political subdivision thereof, or a charge upon the general credit or taxing powers of such bodies, but shall be payable solely out of the Revenues (as defined in Section 1.1 of this Agreement) and, to the extent provided in this Agreement, out of the proceeds of the sale of the Series 2021 Bonds and any temporary investment thereof as herein provided).
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. In addition to the words and terms elsewhere defined in this Agreement or in the Indenture, the following words and terms as used in this Agreement shall have the following meanings unless the context or use indicates another or different meaning:
"Act" shall have the meaning set forth in the preamble of this Agreement.
"Additional Bonds" shall mean Bonds in addition to the Series 2021 Bonds that are issued pursuant to the provisions of Section 2.11 of the Indenture.
"Administration Expenses" shall mean the reasonable and necessary fees, costs and expenses incurred by the Issuer with respect to this Agreement, the Indenture and any transaction or event contemplated by this Agreement or the Indenture including the compensation and reimbursement of fees, costs and expenses and advances payable to the Trustee, any paying agent, any co-paying agent, and the registrar under the Indenture.
"Authorized Company Representative" shall mean any treasurer, assistant treasurer or vice president of the Company or the person or persons at the time designated to act on behalf of the Company by any one of said officers, such designation in each case, to be evidenced by a certificate furnished to the Issuer and the Trustee containing the specimen signature of such person or persons and signed on behalf of the Company by said officer.
"Availability Agreement" shall mean the Availability Agreement dated as of June 21, 1974, as amended from time to time, by and among the Company, Entergy Arkansas, LLC, Entergy Louisiana, LLC, Entergy Mississippi, LLC and Entergy New Orleans, LLC.
"Bond Counsel" shall mean any firm of nationally recognized municipal bond counsel selected by the Company and acceptable to the Issuer and the Trustee.
"Bond Fund" shall mean the fund by that name created and established in Section 5.1 of the Indenture.
"Bonds" shall mean the Series 2021 Bonds and any Additional Bonds issued by the Issuer pursuant to the Indenture.
"Code" shall mean the Internal Revenue Code of 1986, as amended and supplemented.
"Company" shall have the meaning set forth in the preamble of this Agreement.
"Company Mortgage" shall mean the Company's Mortgage and Deed of Trust, dated as of June 15, 1977, made to The Bank of New York Mellon, as successor trustee, as amended, restated and supplemented by the Twenty-Fourth Supplemental Indenture dated as of September 1, 2012, and has been previously, and as may be further, amended or supplemented, including by
the officer’s certificate pursuant to which the series of First Mortgage Bonds relating to the Series 2021 Bonds will be issued.
"Company Mortgage Trustee" shall mean the trustee under the Company Mortgage.
"Continuing Disclosure Agreement" shall mean the agreement substantially in the form of Exhibit A hereto.
"Costs of Issuance" shall mean all fees, charges and expenses incurred in connection with the authorization, preparation, sale, issuance and delivery of the Bonds and the First Mortgage Bonds, including, without limitation, financial, legal and accounting fees, expenses and disbursements, rating agency fees, the Issuer's expenses attributable to the issuance of the Bonds, the cost of printing, engraving and reproduction services and the initial or acceptance fee of the Trustee, all of which shall be paid by the Company with funds other than the proceeds of the Bonds.
"Event of Default" shall mean any event of default specified in Section 8.1 hereof.
"Facilities" shall mean certain air and water pollution control facilities and sewage and solid waste disposal facilities at the Grand Gulf Nuclear Station located in Claiborne County, Mississippi.
"First Mortgage Bonds" shall mean one or more series of bonds issued and delivered under the Company Mortgage and held by the Trustee pursuant to Section 5.9 of this Agreement.
"Hazardous Substances" shall mean any substance or material defined in or designated as hazardous or toxic wastes, hazardous or toxic material, a hazardous, toxic or radioactive substance, or other similar term, by any environmental law now or hereafter in effect, other than those used, collected, treated, disposed, stored, controlled, removed or cleaned up in the ordinary course of the Company’s business, which the Company represents and warrants that it will use, collect, treat, dispose, store, control, remove or clean up in accordance with any applicable law or regulation.
"Indenture" shall mean the Trust Indenture dated as of June 1, 2021 by and between the Issuer and the Trustee securing the Bonds, and any amendments and supplements thereto.
"Issuer" shall mean the Mississippi Business Finance Corporation, a public corporation duly created and validly existing pursuant to the constitution and laws of the State, including the Act, or any successor to its rights and obligations under this Agreement and the Indenture.
"Loan Payments" means the payments to be made by the Company pursuant to Sections 5.2 and 9.1 of this Agreement.
"1954 Code" shall mean the Internal Revenue Code of 1954, as amended and supplemented.
"outstanding," when used with reference to the Bonds, shall mean, as of any particular date, all Bonds authenticated and delivered under the Indenture except:
(a)Bonds canceled at or prior to such date or delivered to or acquired by the Trustee prior to such date for cancellation;
(b)Bonds deemed to be paid in accordance with Article IX of the Indenture;
(c)Bonds in lieu of or in exchange or substitution for which other Bonds shall have been authenticated and delivered pursuant to the Indenture; and
(d)Bonds registered in the name of the Issuer.
"Plant" shall mean the Grand Gulf Nuclear Station located in Claiborne County, Mississippi.
"Prior Bonds" shall mean the $49,500,000 Claiborne County, Mississippi 9 ½% Pollution Control Revenue Bonds (Middle South Energy, Inc. Project) Series A and the $206,000,000 Claiborne County, Mississippi 9 ⅞% Pollution Control Revenue Bonds (Middle South Energy, Inc. Project) Series C.
"Refunding Date" shall mean June 15, 2021, or such later date as may be established by the Company; provided, however, that the Refunding Date shall not be later than ninety (90) days following the date of delivery of the Series 2021 Bonds to the original purchaser or purchasers of the Series 2021 Bonds.
"Regulations" shall mean the applicable proposed, temporary or final regulations promulgated under the Code, as such regulations may be amended or supplemented from time to time.
"Revenues" shall mean all moneys paid or payable by the Company to the Trustee for the account of the Issuer in respect of the principal of, premium, if any, and interest on the Bonds, including, without limitation, amounts paid or payable by the Company pursuant to Sections 5.2 and 9.1 of this Agreement as Loan Payments, amounts paid or payable by the Company in respect of the First Mortgage Bonds and the Thirty-ninth Assignment, and all receipts of the Trustee credited under the provisions of the Indenture against such payments
"Series 2021 Bonds" shall mean the $83,695,000 aggregate principal amount of Mississippi Business Finance Corporation Revenue Refunding Bonds (System Energy Resources, Inc. Project) Series 2021 authorized to be issued pursuant to the Indenture.
"Thirty-ninth Assignment" shall mean the Thirty-ninth Assignment of Availability Agreement, Consent and Agreement by and among the Company, Entergy Arkansas, LLC, Entergy Louisiana, LLC, Entergy Mississippi, LLC, Entergy New Orleans, LLC, the Trustee and the Company Mortgage Trustee.
"Trustee" shall mean The Bank of New York Mellon, as trustee under the Indenture, and its successors as trustee.
"Underwriter" shall mean, in respect of the Series 2021 Bonds, Morgan Stanley & Co. LLC, and in respect of any Additional Bonds, an underwriter designated as such in connection with the issuance of such Additional Bonds.
Section 1.2 Use of Words and Phrases. "Herein," "hereby," "hereunder," "hereof," "hereinabove," "hereinafter" and other equivalent words and phrases refer to this Agreement and not solely to the particular portion thereof in which any such word is used. The definitions set forth in Section 1.1 hereof include both singular and plural. Whenever used herein, any pronoun shall be deemed to include both singular and plural and to cover all genders. 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 "Bond," "owner," "holder" and "person" shall include the plural, as well as the singular, number.
Unless the context shall otherwise indicate, "Person" or "person" shall mean any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
Section 1.3 Nontaxability. It is intended by the parties hereto that this Agreement and all action taken hereunder be consistent with and pursuant to the resolution of the governing body of the Issuer relating to the Bonds, and that the interest on the Bonds be excluded from the gross income of the recipients thereof for federal income tax purposes other than with respect to a person who is a "substantial user" of the Facilities or a "related person" of a "substantial user" within the meaning of the Code and the 1954 Code by reason of the provisions of the Code or the 1954 Code. The Company will not use any of the funds provided by the Issuer hereunder in such a manner as to impair the exclusion of interest on any of the Bonds from the gross income of the recipient thereof for federal income tax purposes nor will it take any action that would impair such exclusion or fail to take any action if such failure would impair such exclusion.
ARTICLE II
REPRESENTATIONS
Section 2.1 Representations and Warranties of the Issuer. The Issuer makes the following representations and warranties as the basis for the undertakings on the part of the Company herein contained:
(a)The Issuer is a public corporation duly created and validly existing pursuant to the constitution and laws of the State, including the Act.
(b)The Issuer has the power to enter into the transactions contemplated by this Agreement and to carry out its obligations hereunder. By proper action of the governing body of the Issuer, the Issuer has been duly authorized to execute and deliver this Agreement.
(c)The Issuer has not assigned, and will not, except as otherwise required by mandatory provisions of law, assign its interest in this Agreement other than to secure the Bonds.
Section 2.2 Representations and Warranties of the Company. The Company makes the following representations and warranties as the basis for the undertakings on the part of the Issuer herein contained:
(a)The Company is a corporation organized and existing under the laws of the State of Arkansas and is in good standing in the State of Arkansas, is duly qualified and in good standing to do business in the State, is not in violation of any provision of its organizational documents, has power to enter into this Agreement and to perform and observe the agreements and covenants on its part contained herein, including, without limitation, the power to issue and deliver the First Mortgage Bonds as contemplated herein and in the Company Mortgage and to execute and deliver the Thirty-ninth Assignment, and has duly authorized the execution and delivery of this Agreement by proper corporate action.
(b)Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement, including, without limitation, the issuance and delivery of the First Mortgage Bonds and the execution and delivery of the Thirty-ninth Assignment, will conflict with or result in a breach of the terms, conditions or provisions of any restriction or any agreement or instrument to which the Company is now a party or by which the Company is bound, or will constitute a default under any of the foregoing, or results in the creation or imposition of any lien, charge or encumbrance whatsoever upon any of the property or assets of the Company except any interests created herein, under the Indenture, the Thirty-ninth Assignment or under the Company Mortgage.
(c)The Federal Energy Regulatory Commission has approved all matters relating to the Company's participation in the transactions contemplated by this Agreement and the Company Mortgage which require said approval, and no other consent, approval,
authorization or other order of any regulatory body or administrative agency or other governmental body is legally required for the Company's participation therein (other than that relating to the construction, acquisition, ownership, operation and maintenance of the Grand Gulf Nuclear Station), except such as may have been obtained or may be required under the securities laws of any state or in connection with the issuance of series of Additional Bonds and except (1) appropriate orders or the taking of other action by governmental regulatory authorities having jurisdiction pursuant to valid statutory enactments as to the issuance by the Company of any securities to parties after the date hereof and (2) with respect to the Availability Agreement and the Thirty-ninth Assignment (other than Section 2.2(b) thereof), in the event that the Company shall determine to sell capacity and/or energy from any generating unit pursuant to the terms of the Availability Agreement or the Thirty-ninth Assignment, appropriate orders, or the taking of other action, by governmental regulatory authorities having jurisdiction pursuant to valid statutory enactments as to the specific terms and provisions under which such capacity and/or energy shall be made available.
(d)The Company will execute the Continuing Disclosure Agreement attached hereto as Exhibit A contemporaneously with the execution of this Agreement and agrees to comply with the requirements set forth therein.
ARTICLE III
THE FACILITIES
Section 3.1 Maintenance of Facilities; Remodeling. The Company shall, at its expense, cause the Facilities, and every element and unit thereof, to be maintained, preserved and kept in good repair, working order and condition, and from time to time to cause all needful and proper repairs, replacements, additions, betterments and improvements to be made thereto; provided, however, that the Company may exercise all of such rights, powers, elections and options to cause the discontinuance of the operation of, or reduce the capacity of, the Facilities, or any element or unit thereof, if, in the judgment of the Company, any such action is necessary or desirable in the conduct of the business of the Company, or if the Company is ordered so to do by any regulatory authority having jurisdiction in the premises, or if the Company intends to sell or dispose of the same and within a reasonable time shall endeavor to effectuate such sale.
The Company may at its own expense cause the Facilities to be remodeled or cause substitutions, modifications and improvements to be made to the Facilities from time to time as it, in its discretion, may deem to be desirable for its uses and purposes, which remodeling, substitutions, modifications and improvements shall be included under the terms of this Agreement as part of the Facilities.
Section 3.2 Insurance. The Company shall, at its expense, cause the Facilities to be kept insured against fire to the extent that property of similar character is usually so insured by companies similarly situated and operating like properties, to a reasonable amount, by reputable insurance companies or, in lieu of or supplementing such insurance in whole or in part, adopt some other method or plan of protection against loss by fire at least equal in protection to the method or plan of protection against such loss of companies similarly situated and operating like properties. All proceeds of such insurance, or such other method or plan, shall be for the account of the Company.
Section 3.3 Condemnation; Eminent Domain. (a) In the event that title to or the temporary use of the Facilities, or any part thereof, shall be taken in condemnation or by the exercise of the power of eminent domain by any governmental body or by any person, firm or corporation acting under governmental or statutory authority, any proceeds from any award or awards in respect of the Facilities or any part thereof made in such condemnation or eminent domain proceedings, after payment of all expenses incurred in the collection thereof, shall be paid for the account of the Company.
(b) The Company shall be entitled to the entire proceeds of any condemnation award or portion thereof made for damages to or takings of its own property other than the Facilities.
ARTICLE IV
ISSUANCE OF BONDS; DISPOSITION OF PROCEEDS OF BONDS
Section 4.1 Issuance of the Series 2021 Bonds. The Issuer shall issue the Series 2021 Bonds under and in accordance with the Indenture, subject to the provisions of any bond purchase agreement between the Issuer and the Underwriter. The Company hereby approves the issuance of the Series 2021 Bonds and all terms and conditions thereof.
Section 4.2 Additional Bonds. So long as the Company shall not be in default hereunder, and at the request of the Company, the Issuer may authorize and issue Additional Bonds in aggregate principal amounts specified from time to time by the Company in order to provide funds for the purpose of refunding the Series 2021 Bonds or any series of Additional Bonds, in whole or in part, or any combination thereof. Any such issuance of Additional Bonds shall be in accordance with the Indenture, including Sections 2.7 and 2.11 thereof.
The right to issue Additional Bonds set forth in this Agreement and the Indenture shall not imply that the Issuer and the Company may not enter into, and the Issuer and the Company expressly reserve the right to enter into, to the extent permitted by law, another agreement or agreements with respect to the issuance by the Issuer, under an indenture or indentures other than the Indenture, of bonds to fund additional facilities at the Plant or refunding bonds to refund all or any principal amount of all or any series of Bonds, and the provisions of this Agreement and the Indenture governing the issuance of Additional Bonds shall not apply thereto.
Section 4.3 Disposition of Bond Proceeds. In consideration of the loan by the Issuer to the Company of the proceeds of the sale of the Series 2021 Bonds as provided in Section 5.1 hereof, the Company agrees that the proceeds of the Series 2021 Bonds shall be deposited in accordance with Section 6.1 of the Indenture in order to redeem, together with other available moneys of the Company, $83,695,000 in aggregate principal amount of the outstanding Series 2019 Bonds on the Refunding Date. The proceeds from the sale of any Additional Bonds shall be applied simultaneously with the delivery of such Additional Bonds in the manner provided in the Indenture and in the supplemental indenture authorizing such Additional Bonds.
Section 4.4 Agreement to Redeem 2019 Bonds. On the Refunding Date for the Series 2019 Bonds being refunded with the proceeds of the Series 2021 Bonds, the Company, in accordance with Section 6.1 of the Indenture, agrees to pay to the paying agent for such Series 2019 Bonds any amount necessary to pay interest due on such Series 2019 Bonds through the Refunding Date. The Company shall also pay out of its own money and not out of proceeds of the Series 2021 Bonds all reasonable Costs of Issuance with respect to the Series 2021 Bonds.
ARTICLE V
THE LOAN; OTHER OBLIGATIONS; FIRST MORTGAGE BONDS
Section 5.1 Loan. The proceeds of the sale of the Series 2021 Bonds, which shall be deposited in accordance with Section 6.1 of the Indenture, are hereby loaned by the Issuer to the Company in accordance with the provisions of this Agreement. The Issuer hereby agrees to make additional loans to the Company from time to time from the proceeds of any Additional Bonds issued by the Issuer pursuant to the Indenture.
Section 5.2 Loan Payments. To repay the loan, the Company shall make or cause to be made Loan Payments in installments, so as to provide amounts for the timely payment of the principal of and premium, if any, and interest on the Bonds on the dates and in the amounts and in the manner provided in the Indenture for the Issuer to cause payment to be made to the Trustee of principal of and premium, if any, and interest on the Bonds, whether at maturity, upon redemption or acceleration, or otherwise; provided, however, that the obligation of the Company to make any such payment hereunder shall be reduced by the amount of any reduction under the Indenture of the amount of the corresponding payment required to be made by the Issuer thereunder in respect of the principal of or premium, if any, or interest on the Bonds.
Sectoin 5.3 Bond Fund. The Company shall pay the Loan Payments required of it under this Agreement by remitting or causing to be remitted the same directly to the Trustee for deposit in the Bond Fund established under the Indenture and administered by the Trustee as provided in the Indenture.
Section 5.4 Payments to Issuer. Out of funds provided by the Company, there shall be paid (i) all of the Issuer's reasonable actual out-of-pocket expenses and costs of issuance in connection with the Bonds, and (ii) on the date of delivery of the Bonds, a financing acceptance fee in the amount of $10,000.00. Such payments shall be used for the purpose of paying administrative and related costs of the Issuer, but shall not include Trustee fees incurred by the Issuer in enforcing the provisions of this Agreement.
Section 5.5 Payments Assigned; Obligation Absolute. It is understood and agreed that all Loan Payments to be made by the Company are, by the Indenture, to be pledged by the Issuer to the Trustee, and that all rights and interest of the Issuer hereunder (except for the Issuer's rights under Sections 5.4, 5.6, 5.7, 5.8 and 8.5 hereof and any rights of the Issuer to receive notices, certificates, requests, requisitions, directions and other communications hereunder), under the First Mortgage Bonds (including the right to receive the First Mortgage Bonds under this Agreement) and under the Thirty-ninth Assignment, are to be pledged and assigned to the Trustee. The Company assents to such pledge and assignment and agrees that the obligation of the Company to make the Loan Payments shall be absolute, irrevocable and unconditional and shall not be subject to cancellation, termination or abatement, or to any defense other than payment or to any right of set-off, counterclaim or recoupment arising out of any breach under this Agreement, the Indenture or otherwise by the Issuer or the Trustee or any other party, or out of any obligation or liability at any time owing to the Company by the Issuer, the Trustee or any other party, and, further, that the Loan Payments and the other payments due hereunder shall continue to be payable at the times and in the amounts specified herein, whether
or not the Facilities or the Plant, or any portion thereof, shall have been destroyed by fire or other casualty, or title thereto, or the use thereof, shall have been taken by the exercise of the power of eminent domain, and that there shall be no abatement of or diminution in any such payments by reason thereof, whether or not the Facilities or the Plant shall be used or useful, and whether or not any applicable laws, regulations or standards shall prevent or prohibit the use of the Facilities or the Plant, or for any other reason.
Section 5.6 Payment of Expenses. The Company shall pay all of the Administration Expenses of the Issuer and the compensation and the reimbursement of expenses and advances of the Trustee, any paying agent, any co-paying agent, and the registrar under the Indenture, such payments to be made directly to such entities.
Section 5.7 Indemnification. To the extent permitted by law, the Company agrees to indemnify, hold harmless and defend the Issuer, the Trustee and their officers, directors, employees and agents (collectively, the "Indemnified Persons"), against any and all fees, costs and charges, losses, damages, claims, actions, liabilities and expenses of any conceivable nature, kind or character (including, without limitation, reasonable fees and expenses of attorneys, accountants, consultants and other experts, litigation and court costs, amounts paid in settlement and amounts paid to discharge judgments) to which the Indemnified Persons, or any of them, may become subject under or any statutory law (including federal or state securities laws) or at common law or otherwise, arising out of or based upon or in any way relating to:
(a)the Bonds, the First Mortgage Bonds, the Indenture, this Agreement, or the Company Mortgage (collectively, the "Documents") or the execution or amendment hereof or thereof or in connection with transactions contemplated hereby or thereby, including the issuance, sale or resale of the Bonds;
(b)the performance and observance by or on behalf of the Issuer or the Trustee of those things on the part of the Issuer or the Trustee, as applicable, agreed to be performed or observed hereunder and under the Documents;
(c)any act or omission of the Company or any of their agents, contractors, servants, employees, tenants or licensees in connection with the Facilities, the operation of the Facilities, or the condition, environmental or otherwise, occupancy, use, possession, conduct or management of work done in or about, or from the planning, design, acquisition, installation or construction of, the Facilities or any part thereof;
(d)any lien or charge upon payments by the Company to the Issuer and the Trustee hereunder, or any taxes (including, without limitation, all ad valorem taxes and sales taxes), assessments, impositions and other charges imposed on the Issuer or the Trustee in respect of any portion of the Facilities;
(e)any violation of any environmental laws with respect to, or the release of any Hazardous Substances from, the Facilities or any part thereof;
(f)the defeasance and/or redemption, in whole or in part, of the Bonds or the First Mortgage Bonds;
(g)any untrue statement or misleading statement or alleged untrue statement or alleged misleading statement of a material fact relating to the Company or the Facilities contained in any offering or disclosure document or disclosure or continuing disclosure document for the Bonds or any of the documents relating to the Bonds, or any omission or alleged omission from any offering or disclosure document or disclosure or continuing disclosure document for the Bonds relating to the Company or the Facilities of any material fact necessary to be stated therein in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading;
(h)any declaration of taxability of interest on the Bonds, or allegations that interest on the Bonds is taxable or any regulatory audit or inquiry regarding whether interest in the Bonds is taxable;
(i)the Trustee’s acceptance or administration of the trust of the Indenture, or the exercise or performance of any of its powers or duties thereunder or under any of the Documents;
(j)any injury to or death of any Person or damage to property in or upon the Facilities or growing out of or connected with the use, nonuse, condition or occupancy of the Facilities;
except in the case of the foregoing indemnification of the Indemnified Persons, to the extent such damages are caused by the negligence or bad faith of the Trustee or the Issuer.
In the event that any action or proceeding is brought against any Indemnified Person with respect to which indemnity may be sought hereunder, the Company, upon written notice from the Indemnified Person, shall assume the investigation and defense thereof, including the employment of counsel selected by the Indemnified Person, and shall assume the payment of all expenses related thereto, with full power to litigate, compromise or settle the same in their sole discretion; provided that the Indemnified Person shall have the right to review and approve or disapprove any such compromise or settlement. Each Indemnified Person shall have the right to employ separate counsel in any such action or proceeding and participate in the investigation and defense thereof, and the Company shall pay the reasonable fees and expenses of such separate counsel; provided, however, that such Indemnified Person may only employ separate counsel at the expense of the Company if in the judgment of such Indemnified Person a conflict of interest exists by reason of common representation or if all parties commonly represented do not agree as to the action (or inaction) of counsel.
The rights of any persons to indemnity hereunder and rights to payment of fees and reimbursement of expenses shall survive the final payment or defeasance of the Bonds and in the case of the Trustee any resignation or removal. The provisions of this Section shall remain valid and in effect notwithstanding repayment of the loan hereunder or payment, redemption or defeasance of the Bonds or termination of this Agreement or the Indenture.
Section 5.8 Payment of Taxes; Discharge of Liens. The Company shall: (a) pay, or make provision for payment of, all lawful taxes and assessments, including income, profits, property or excise taxes, if any, or other municipal or governmental charges, levied or assessed by any federal, state or municipal government or political body upon the Issuer upon any amounts payable hereunder; and (b) pay or cause to be satisfied and discharged or make adequate provision to satisfy and discharge, within sixty (60) days after the same shall accrue, any lien or charge upon any amounts payable hereunder, and all lawful claims or demands for labor, materials, supplies or other charges which, if unpaid, might be or become a lien upon such amounts; provided, that, if the Company shall first notify the Issuer and the Trustee of its intention so to do, the Company may in good faith contest any such lien or charge or claims or demands in appropriate legal proceedings, and in such event may permit the items so contested to remain undischarged and unsatisfied during the period of such contest and any appeal therefrom, unless by nonpayment of any such items the lien of the Indenture as to the amounts payable hereunder will be materially endangered, in which event the Company shall promptly pay and cause to be satisfied and discharged all such unpaid items. The Issuer shall cooperate fully with the Company in any such contest.
Section 5.9 Issuance, Delivery and Surrender of First Mortgage Bonds, Additional Security. (a) The obligation of the Company set forth in Section 5.2 hereof to make the Loan Payments required therein with respect to the Series 2021 Bonds shall be evidenced by a series of First Mortgage Bonds. The Company shall issue and deliver to the Issuer First Mortgage Bonds as provided in subsection (b) of this Section 5.9.
(b)The obligations of the Company to make payments under Section 5.2 hereof in respect of the Series 2021 Bonds shall be evidenced by a series of First Mortgage Bonds with the excess of the principal amount of the First Mortgage Bonds over the principal amount of the Series 2021 Bonds to be applied to the payment of accrued interest on the Series 2021 Bonds. Concurrently with the issuance and delivery by the Issuer of the Series 2021 Bonds, the Company shall issue and deliver to the Issuer a series of First Mortgage Bonds (i) maturing on the stated maturity date of the Series 2021 Bonds, (ii) in a principal amount equal to the sum of (A) the aggregate principal amount of the Series 2021 Bonds and (B) an amount equal to eight and one-half months interest on the Series 2021 Bonds, (iii) containing redemption provisions correlative to the redemption provisions of the Indenture relating to the Series 2021 Bonds requiring mandatory redemption thereof, (iv) requiring payments to be made to the Trustee for the account of the Issuer, and (v) bearing no interest.
(c)The obligation of the Company to make any payment of the principal of or premium, if any, or interest on the First Mortgage Bonds, whether at maturity, upon redemption or otherwise, shall be reduced by the amount of any reduction under the Indenture of the amount of the corresponding payment required to be made by the Issuer thereunder in respect of the principal of or premium, if any, or interest on the Series 2021 Bonds, all in accordance with the provisions of the Company Mortgage.
(d)The Issuer shall not sell, assign or transfer the First Mortgage Bonds, except to the extent provided in Section 5.5 hereof. In view of the pledge and assignment
referred to in said Section 5.5, the Issuer agrees that (i) in satisfaction of the obligations of the Company set forth in paragraph (b) of this Section 5.9 with respect to the Series 2021 Bonds, the First Mortgage Bonds shall be issued and delivered to, registered in the name of, and held by the Trustee for the benefit of the owners and holders from time to time of the Series 2021 Bonds; (ii) the Indenture shall provide that the Trustee shall not sell, assign or transfer the First Mortgage Bonds except to a successor trustee under the Indenture, and shall surrender First Mortgage Bonds to the Company Mortgage Trustee in accordance with the provisions of subsection (e) of this Section; and (iii) the Company may take such actions as it shall deem to be desirable to effect compliance with such restrictions on transfer, including the placing of an appropriate legend on each First Mortgage Bond and the issuance of stop-transfer instructions to the Company Mortgage Trustee or any other transfer agent under the Company Mortgage. Any action taken by the Trustee in accordance with the provisions of Section 4.8 of the Indenture shall be binding upon the Company.
(e)At the time any Series 2021 Bonds cease to be outstanding (other than by reason of the payment or redemption of First Mortgage Bonds and other than by reason of the applicability of clause (c) in the definition of "outstanding" herein), the Issuer shall cause the Trustee to surrender for cancellation to the Company Mortgage Trustee First Mortgage Bonds in an aggregate principal amount equal to the sum of (i) the aggregate principal amount of the Series 2021 Bonds which so cease to be outstanding and (ii) an amount equal to eight and one-half months interest on the amount of Series 2021 Bonds which so cease to be outstanding.
(f)For the purpose of determining whether or not any payment of the principal of or premium, if any, or interest on the First Mortgage Bonds shall have been made in full, any moneys paid by the Company in respect of the First Mortgage Bonds which shall have been withdrawn by the Trustee from the Bond Fund pursuant to Section 5.4 of the Indenture shall be deemed to have been paid by the Company to the Trustee pursuant to Section 5.2 hereof and not to have been paid by the Company in respect of the First Mortgage Bonds.
(g)The obligation of the Company set forth in Section 5.2 hereof to make Loan Payments therein with respect to any Additional Bonds may be evidenced by one or more series of First Mortgage Bonds on terms and conditions that will be set forth in either an amendment or supplement to this Agreement or a supplemental indenture to the Indenture.
(h)As additional security for the Company’s obligations under this Agreement with respect to the Series 2021 Bonds, the Company shall execute and deliver to the Trustee, the Thirty-ninth Assignment; and as additional security for the Company’s obligation under this Agreement with respect to any Additional Bonds, the Company may execute and deliver an additional assignment of the Availability Agreement on terms and conditions that will be set forth in either an amendment or supplement to this Agreement or a supplemental indenture to the Indenture.
ARTICLE VI
SPECIAL COVENANTS AND AGREEMENTS
Section 6.1 Maintenance of Existence. The Company shall maintain its organizational existence, will not dissolve or otherwise dispose of all or substantially all of its assets and will not consolidate with or merge with or into another entity; provided, however, that the Company may consolidate with or merge with or into, or sell or otherwise transfer all or substantially all of its assets (and thereafter dissolve) to, another entity, organized under the laws of the United States, one of the states thereof or the District of Columbia, if the surviving, resulting or transferee entity, as the case may be (if other than the Company), prior to or simultaneously with such consolidation, merger, sale or transfer, assumes, by delivery to the Trustee of an instrument in writing satisfactory in form and substance to the Trustee, all of the obligations of the Company hereunder and under the First Mortgage Bonds and the Thirty-ninth Assignment, and provided that both immediately prior to such dissolution, disposal, consolidation or merger and after giving effect thereto, no Event of Default under this Agreement (or event which, with the giving of notice or passage of time, or both, would constitute an Event of Default under this Agreement) shall have occurred and be continuing.
If a consolidation, merger or sale or other transfer is made as permitted by this Section 6.1, the provisions of this Section 6.1 shall continue in full force and effect and no further consolidation, merger or sale or other transfer shall be made except in compliance with the provisions of this Section 6.1.
Section 6.2 Arbitrage Covenant. The Issuer and the Company covenant that the proceeds of the sale of the Bonds, the earnings thereon, and any other moneys on deposit in any fund or account maintained in respect of the Bonds (whether such moneys were derived from the proceeds of the sale of the Bonds or from other sources) will not be used in a manner which would cause the Bonds to be treated as "arbitrage bonds" within the meaning of Section 148 of the Code. The Company further covenants that: (a) all actions with respect to the Bonds required by Section 148(f) of the Code shall be taken; (b) it shall make the determinations required by paragraph (b) of Section 7.2 of the Indenture and promptly notify the Trustee of the same, together with supporting calculations; and (c) it shall within twenty-five (25) days after (i) the calendar date which corresponds to the final maturity of the respective series of Bonds and each anniversary thereof falling on or after the date of initial authentication and delivery thereof up to and including the final maturity of such series of the Bonds, unless the final payment, whether upon redemption in whole or at maturity, of such Bonds shall have occurred prior to such anniversary, and (ii) such final payment, file with the Trustee a statement signed by the chief financial officer of the Company (or person performing similar functions) to the effect that the Company is then in compliance with its covenants contained in clauses (a) and (b) of this sentence, together with supporting calculations; provided, however, that if the Company shall furnish an opinion of Bond Counsel to the Trustee to the effect that no further action by the Company is required for such compliance with respect to the Bonds, the Company shall not thereafter be required to deliver any such statements or calculations.
Section 6.3 Bonds are Limited Obligations. The Bonds shall be limited obligations of the Issuer, payable solely out of the Revenues.
THE BONDS ARE NOT A GENERAL OBLIGATION OF THE ISSUER AND ARE NOT AN INDEBTEDNESS OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF. NEITHER THE FAITH AND CREDIT OF THE ISSUER NOR THE FAITH AND CREDIT OR THE TAXING POWER OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF THE BONDS, OR PREMIUM, IF ANY, OR THE INTEREST THEREON OR OTHER COSTS INCIDENTAL THERETO. THE ISSUER HAS NO TAXING POWER.
Section 6.4 Tax-Exempt Status of Bonds. The Issuer and the Company mutually covenant and agree that neither of them shall take or authorize or permit any action to be taken, and have not taken or authorized or permitted any action to be taken, that results in interest paid on the Bonds being included in gross income for purposes of federal income taxes. Without limiting the generality of the foregoing, the Company further covenants, represents and agrees as follows:
(a)Substantially all of the net proceeds of the sale of the Prior Bonds have been used to undertake the acquisition of air and water pollution control facilities and sewage and solid waste disposal facilities within the meaning of Section 103(b)(4) of the 1954 Code. All of the proceeds of the Prior Bonds, the Series 1998 Bonds and the Series 2019 Bonds have been expended.
(b)The weighted average maturity of the Series 2021 Bonds does not exceed 120% of the reasonably expected economic life of the Facilities financed with the proceeds of the Prior Bonds.
(c)The principal amount of the Series 2021 Bonds shall not exceed the outstanding principal amount of the Series 2019 Bonds.
(d)The Series 2021 Bonds are not and will not be "federally guaranteed" (as defined in Section 149(b) of the Code).
(e)None of the proceeds of the Series 2021 Bonds will be used, and none of the proceeds of the Series 2019 Bonds, the Series 1998 Bonds or the Prior Bonds were used, to provide any airplane, skybox or other private luxury box, or health club facility, any facility primarily used for gambling, or any store the principal business of which is the sale of alcoholic beverages for consumption off premises.
(f)The information furnished by the Company and used by the Issuer in preparing its No-Arbitrage Certificate dated the issue date of the Series 2021 Bonds is accurate and complete as of the date of the issuance of the Series 2021 Bonds.
(g)None of the proceeds of the Series 2021 Bonds will be used to finance Costs of Issuance of the Series 2021 Bonds.
(h)The Company will take no action that would cause any funds constituting gross proceeds of the Series 2021 Bonds to be used in a manner as to constitute a prohibited
payment under the applicable regulations pertaining to, or in any other fashion as would constitute failure of compliance with, Section 148 of the Code and the applicable regulations thereunder.
The Company will not knowingly take any action, or knowingly omit to take any action, which action or omission will adversely affect the exclusion from gross income of the holders thereof for federal income tax purposes of interest on the Bonds (other than holders who are substantial users of the Facilities or related persons within the meaning of section 147(a) of the Code), and in the event of such action or omission (whether taken with knowledge or not) will promptly, upon receiving knowledge thereof, take all lawful actions, based on advice of Bond Counsel and at the Company's expense, as may rescind or otherwise negate such action or omission.
The covenants and agreements contained in this Section 6.4 shall survive any termination of this Agreement.
Section 6.5 Compliance with Law. The Company shall, throughout the term of this Agreement and at no expense to the Issuer, promptly comply or cause compliance with all laws, ordinances, orders, rules, regulations and requirements of duly constituted public authorities that are applicable to the Facilities or to the repair and alteration thereof, or to the use or manner of use of the Facilities and that, if there were non-compliance, would materially adversely affect or impair the obligations of the Company under this Agreement or the ability of the Company to discharge such obligations. Notwithstanding the foregoing, the Company shall have the right to contest the legality of any such law, ordinance, order, rule, regulation or requirement as applied to the Facilities; provided that, in the opinion of counsel to the Company, such contest shall not in any way materially adversely affect or impair the obligations of the Company under this Agreement or the ability of the Company to discharge such obligations.
Section 6.6 No Warranty. The Issuer makes no warranty, either express or implied, as to the Facilities, including, without limitation, title to the Facilities or the actual or designed capacity of the Facilities, as to the suitability or operation of the Facilities for the purposes specified in this Agreement, as to the condition of the Facilities or as to the suitability thereof for the Company's purposes or needs or as to compliance of the Facilities with applicable laws and regulations or the ability of the Company to discharge the Bonds. The Company covenants with the Issuer that it will make no claim against the Issuer for any deficiency which may at any time exist in the Facilities, nor will it assert against the Issuer any other claim for breach of warranty with respect to the Facilities. The obligations of the Company under this Section shall survive any assignment or termination of this Agreement.
Section 6.7 Continuing Disclosure. It is understood, acknowledged and agreed that the Issuer shall have no responsibility for compliance with the continuing disclosure requirements set forth in Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as in effect on the date of this Agreement, and shall have no liability to the Underwriter, the holders of the Bonds or any other person with respect to such disclosure matters. To the extent applicable to the Company, the Company agrees to comply fully with the continuing disclosure requirements of said Rule 15c2-12.
ARTICLE VII
ASSIGNMENT, LEASING AND SELLING
Section 7.1 Limitation. This Agreement shall not be assigned nor shall the Facilities be leased or sold, in whole or in part, except as provided in this Article VII or in Section 6.1 hereof or in the Indenture.
Section 7.2 Issuer's Rights of Assignment. The Issuer may, only in accordance with the Indenture, assign its rights and interests under this Agreement as set forth in Section 5.5 hereof (including the First Mortgage Bonds and the Thirty-ninth Assignment) and pledge the moneys receivable hereunder to the Trustee as security for payment of the principal of and premium, if any, and interest on the Bonds and all amounts payable under the Indenture, the Bonds and this Agreement. The Company hereby assents to such assignments and agrees that the Trustee may exercise and enforce in accordance with the Indenture any of the rights of the Issuer under this Agreement or the First Mortgage Bonds and the Thirty-ninth Assignment. Any such assignment, however, shall be subject to all of the rights and privileges of the Company as provided in this Agreement.
Section 7.3 Assignment by the Company. The Company's interest in this Agreement may be assigned in whole or in part, and the Facilities may be leased or sold as a whole or in part (whether a specific element or unit or an undivided interest), by the Company, subject, however, to the condition that no assignment, lease or sale (other than as described in Section 6.1 hereof) shall relieve the Company from primary liability for its obligations under Section 5.2 hereof to pay the Loan Payments, or for any other of its obligations hereunder or under the First Mortgage Bonds or the Thirty-ninth Assignment, other than those obligations relating to the operation, maintenance and insurance of the Facilities, which obligations (to the extent of the interest assigned, leased or sold and to the extent assumed by the assignee, lessee or purchaser) shall be deemed to be satisfied and discharged.
After any lease or sale of any element or unit of the Facilities, or any interest therein, such element or unit, or interest therein, shall no longer be deemed to be part of the Facilities for the purposes of this Agreement.
Upon any such lease or sale, the Company shall comply with the requirements of Section
6.4 hereof, the 1954 Code and the Code and the regulations promulgated thereunder (including,
without limitation, the taking of remedial action with respect to the Bonds) as the same may then be applicable.
The Company shall, within fifteen (15) days after the delivery thereof, furnish to the Issuer and the Trustee a true and complete copy of the agreements or other documents effectuating any such assignment, lease or sale.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
Section 8.1 Events of Default. Each of the following events shall constitute and is referred to in this Agreement as an "Event of Default":
(a)an "Event of Default" as such term is defined in Section 901 of the Company Mortgage;
(b)a failure by the Company to make when due any Loan Payments required to be made pursuant to Section 5.2 hereof, which failure shall have resulted in an "Event of Default" under Section 10.1(a) or (b) of the Indenture; or
(c)a failure by the Company to pay when due any other amount required to be paid under this Agreement or to observe and perform any covenant, condition or agreement on its part to be observed or performed, which failure shall continue for a period of ninety (90) days after written notice, specifying such failure and requesting that it be remedied, shall have been given to the Company by the Issuer or the Trustee, unless the Issuer and the Trustee shall agree in writing to an extension of such period prior to its expiration; provided, however, that the Issuer and the Trustee shall be deemed to have agreed to an extension of such period if corrective action is initiated by the Company within such period and is being diligently pursued.
Section 8.2 Force Majeure. The provisions of Section 8.1 hereof are subject to the following limitations: if by reason of acts of God; strikes, lockouts or other industrial disturbances; acts of public enemies; orders or other acts of any kind of the government of the United States or of the State of Mississippi, or any other sovereign entity or body politic, or any department, agency, political subdivision, court or official of any of them, or any civil or military authority; insurrections; riots; epidemics; landslides; lightning; earthquakes; volcanoes; fires; hurricanes; tornados; storms; floods; washouts; droughts; arrests; restraint of government and people; civil disturbances; explosions; breakage of, or accident to, machinery; partial or entire failure of utilities; or any cause or event not reasonably within the control of the Company, the Company is unable in whole or in part to carry out any one or more of its agreements or obligations contained herein, other than its obligations under Section 5.2 hereof to pay the Loan Payments and its obligations under Sections 5.8, 6.1, 6.4 and 9.1 hereof, the Company shall not be deemed in default by reason of not carrying out said agreement or agreements or performing said obligation or obligations during the continuance of such inability. The Company agrees, however, to use its best efforts to remedy with all reasonable dispatch the cause or causes preventing it from carrying out its agreements; provided, that the settlement of strikes, lockouts and other industrial disturbances shall be entirely within the discretion of the Company, and the Company shall not be required to make settlement of strikes, lockouts and other industrial disturbances by acceding to the demands of the opposing party or parties when such course is, in the judgment of the Company, unfavorable to the Company.
Section 8.3 Remedies on Default. (a) Upon the occurrence and continuance of any Event of Default described in clause (a) of Section 8.1 hereof, the Trustee, as the holder of the
First Mortgage Bonds, shall, subject to the provisions of the Indenture, have the rights provided in the Company Mortgage.
(b)Upon the occurrence and continuance of any Event of Default described in Section 8.1 hereof, and further upon the condition that, in accordance with the terms of the Indenture, the Bonds shall have become immediately due and payable pursuant to any provision of the Indenture, the Loan Payments required to be paid pursuant to Section 5.2 hereof shall, without further action, become and be immediately due and payable.
(c)Upon the occurrence and continuance of any Event of Default, the Issuer with the prior consent of the Trustee, or the Trustee, may take any action at law or in equity (including as a holder of the First Mortgage Bonds and as an assignee under the Thirty-ninth Assignment) to collect the payments then due and thereafter to become due hereunder, or to enforce performance and observance of any obligation, agreement or covenant of the Company under this Agreement.
(d)Any amounts collected pursuant to action taken under this Section shall be applied in accordance with the Indenture.
(e)In case any proceeding taken by the Issuer or the Trustee on account of any Event of Default shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Issuer or the Trustee, then and in every such case the Issuer and the Trustee shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies and powers of the Issuer and the Trustee shall continue as though no such proceeding had been taken.
Section 8.4 No Remedy Exclusive. No remedy conferred upon or reserved to the Issuer or the Trustee by this Agreement is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any Event of Default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Issuer or the Trustee to exercise any remedy reserved to it in this Article, it shall not be necessary to give any notice other than such notice as may be required in this Article.
Section 8.5 Agreement to Pay Attorneys' Fees and Expenses. In the event the Company should default under any of the provisions of this Agreement and the Issuer or the Trustee should employ attorneys or incur other expenses for the collection of payments due hereunder or for the enforcement of performance or observance of any obligation or agreement on the part of the Company contained herein or in the First Mortgage Bonds, the Company agrees that it will on demand therefor pay to the Issuer or the Trustee, as the case may be, the reasonable fees of such attorneys and such other expenses so incurred.
Section 8.6 Waiver of Breach. In the event that any agreement contained herein shall be breached by either the Company or the Issuer and such breach shall thereafter be waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. In view of the assignment of the Issuer's rights in and under this Agreement to the Trustee under the Indenture, the Issuer shall have no power to waive any default hereunder by the Company without the consent of the Trustee. Any waiver of any "Event of Default" under the Indenture and a rescission and annulment of its consequences, and any waiver of any "Event of Default" under the Company Mortgage and a rescission and annulment of its consequences, shall constitute a waiver of the corresponding Event of Default hereunder or an "Event of Default" thereunder and a rescission and annulment of the consequences thereof.
ARTICLE IX
REDEMPTION OR PURCHASE OF BONDS
Section 9.1 Redemption of Bonds. The Issuer shall take the actions required by the Indenture to discharge the lien thereof through the redemption, or provision for payment or redemption, of all Bonds then outstanding, or to effect the redemption, or provision for payment or redemption, of less than all the Bonds then outstanding, upon receipt by the Issuer and the Trustee from the Company of a notice designating the principal amounts, series and maturities of the Bonds to be redeemed, or for the payment or redemption of which provision is to be made, and, in the case of redemption of Bonds, or provision therefor, specifying the date of redemption, which shall not be less than forty-five (45) days from the date such notice is given (or such shorter period as may be agreed to by the Trustee), and the applicable redemption provision of the Indenture. Unless otherwise stated therein or otherwise required by the Indenture, such notice shall be revocable by the Company at any time prior to the time at which the Bonds to be redeemed, or for the payment or redemption of which provision is to be made, are first deemed to be paid in accordance with Article IX of the Indenture. The Company shall furnish, as a prepayment of the Loan Payments, any moneys or Government Securities (as defined in the Indenture) required by the Indenture to be deposited with the Trustee or otherwise paid by the Issuer in connection with any of the foregoing purposes.
Section 9.2 Purchase of Bonds. The Company may at any time, and from time to time, furnish moneys to the Trustee accompanied by a written notice directing the Trustee to apply such moneys to the purchase in the open market of Bonds in the principal amounts and of the series and maturities specified in such notice, and any Bonds so purchased shall thereupon be canceled by the Trustee.
ARTICLE X
MISCELLANEOUS
Section 10.1 Notices. Except as otherwise provided in this Agreement, all notices, certificates or other communications shall be sufficiently given and shall be deemed given when mailed by registered or certified mail, postage prepaid, to the Issuer, the Company or the Trustee. Copies of each notice, certificate or other communication given hereunder by or to the Company shall be mailed by registered or certified mail, postage prepaid, to the Trustee; provided, however, that the effectiveness of any such notice shall not be affected by the failure to send any such copies. Notices, certificates or other communications shall be sent to the following addresses:
Company: System Energy Resources, Inc.
639 Loyola Avenue
New Orleans, LA 70113
ATTN: Steven C. McNeal, Vice President and Treasurer
Phone: 504-576-4363
Email: smcneal@entergy.com
Issuer: Mississippi Business Finance Corporation
735 Riverside Drive, Ste. 300
Jackson, MS 39202
ATTN: E. F. "Buddy" Mitcham, Executive Director
Phone: 601-355-6232
Email: bmitcham@mbfc.cc
Trustee and
Bond Registrar: The Bank of New York Mellon
Corporate Trust Division
4655 Salisbury Road, Suite 300
Jacksonville, FL 32256
ATTN: Cindy Moore, Vice President
Phone: 904-645-1943
Email: cindy.moore@bnymellon.com
Any of the foregoing may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent.
Section 10.2 Severability. If any provision of this Agreement shall be held or deemed to be or shall, in fact, be illegal, inoperative or unenforceable, the same shall not affect any other provision or provisions herein contained or render the same invalid, inoperative, or unenforceable to any extent whatever.
Section 10.3 Execution of Counterparts; Electronic Signatures. This Agreement 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. The words "execution," "signed"
and "signature" and words of like import in this Agreement or in any other certificate, agreement or document related to this Agreement (to the extent permissible under governing documents) shall include images of manually executed signatures transmitted by facsimile or other electronic format (including, without limitation, "pdf," "tif" or "jpg") and other electronic signatures (including, without limitation, DocuSign and AdobeSign). The use of electronic signatures and electronic records (including, without limitation, any contract or other record created, generated, sent, communicated, received or stored by electronic means) shall be of the same legal effect, validity and enforceability as a manually executed signature or use of a paper-based record-keeping system to the fullest extent permitted by applicable law, including, without limitation, the Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act and any other applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act or the Uniform Commercial Code.
Section 10.4 Amounts Remaining in Bond Fund. It is agreed by the parties hereto that after payment in full of (i) the Bonds (or the provision for payment thereof having been made in accordance with the provisions of the Indenture), (ii) the Administration Expenses of the Issuer, and (iii) all other amounts required to be paid under this Agreement and the Indenture, any amounts remaining in the Bond Fund shall belong to and be paid by the Trustee, upon written instruction, to the Company.
Section 10.5 Amendments, Changes and Modifications. Except as otherwise provided in this Agreement or the Indenture, subsequent to the initial issuance of Bonds and prior to payment in full of the Bonds (or provision for payment thereof having been made in accordance with the provisions of the Indenture), this Agreement may not be effectively amended, changed, modified, altered or terminated nor any provision waived without the written consent of the Trustee, which shall not be unreasonably withheld.
Section 10.6 Governing Law. This Agreement shall be governed exclusively by and construed in accordance with the applicable laws of the State.
Section 10.7 Authorized Company Representatives. An Authorized Company Representative shall act on behalf of the Company whenever the approval of the Company is required or the Company requests the Issuer to take some action, and the Issuer and the Trustee shall be authorized to act on any such approval or request, and neither party hereto shall have any complaint against the other or against the Trustee as a result of any such action taken.
Section 10.8 Term of the Agreement. This Agreement shall be in full force and effect from the date hereof until the right, title and interest of the Trustee in and to the Trust Estate (as defined in the Indenture) shall have ceased, terminated and become void in accordance with Article IX of the Indenture and until all payments required under this Agreement shall have been made.
Section 10.9 No Personal Liability. No covenant or agreement contained in this Agreement shall be deemed to be the covenant or agreement of any official, officer, agent, or employee of the Issuer in his individual capacity, and no such person shall be subject to any personal liability or accountability by reason of the issuance thereof.
Section 10.10 Parties in Interest. This Agreement shall inure to the benefit of and shall be binding upon the Issuer, the Company, the Trustee and their respective successors and assigns, and no other person, firm or corporation shall have any right, remedy or claim under or by reason of this Agreement; provided, however, that any monetary obligation of the Issuer created by or arising out of this Agreement shall be payable solely out of the Revenues and shall not constitute, and no breach of this Agreement by the Issuer shall impose, a pecuniary liability upon the Issuer or a charge upon the Issuer's general credit.
[Signature page to Loan Agreement]
IN WITNESS WHEREOF, the Issuer and the Company have caused this Agreement to be signed on their behalf by their duly authorized representatives as of the date set forth above.
MISSISSIPPI BUSINESS FINANCE CORPORATION
By: /s/ E.F. Buddy Mitcham, Jr.
E. F. "Buddy" Mitcham, Jr.
Executive Director
ATTEST:
By: /s/ Larry W. Mobley
Larry W. Mobley
Secretary
SYSTEM ENERGY RESOURCES, INC.
By: /s/ Kevin J. Marino
Kevin J. Marino
Assistant Treasurer
EXHIBIT A
CONTINUING DISCLOSURE AGREEMENT