Adel Industrial Development Authority Revenue Bonds (Sanderson Farms, Inc. (Production Division) Project), Series 2006 Bond Purchase Agreement Dated as of July 1, 2006
EXHIBIT
10.2
Adel Industrial Development Authority
$17,200,000
Revenue Bonds
(Xxxxxxxxx Farms, Inc. (Production Division) Project),
Series 2006
(Xxxxxxxxx Farms, Inc. (Production Division) Project),
Series 2006
Bond Purchase Agreement
Dated as of July 1, 2006
Table of Contents
| Page | ||||||||
1. |
ISSUANCE OF THE BONDS | 1 | ||||||
| 1.1 | Authorization of the Bonds | 1 | ||||||
| 1.2 | Terms of the Bonds | 1 | ||||||
| 1.3 | Security for the Bonds | 2 | ||||||
| 1.4 | Limited Obligation | 2 | ||||||
2. |
SALE AND PURCHASE OF THE BONDS; ADVANCES | 2 | ||||||
3. |
CLOSING | 3 | ||||||
4. |
CONDITIONS TO CLOSING | 3 | ||||||
| 4.1 | Representations and Warranties | 3 | ||||||
| 4.2 | Performance; No Default | 3 | ||||||
| 4.3 | Purchase Permitted by Applicable Law, etc | 4 | ||||||
| 4.4 | Lease Agreement | 4 | ||||||
| 4.5 | Lien Documents | 4 | ||||||
| 4.6 | Proceedings and Documents | 4 | ||||||
5. |
PROJECT FUND | 4 | ||||||
| 5.1 | Creation of the Project Fund | 4 | ||||||
| 5.2 | Disbursements | 5 | ||||||
| 5.3 | Investments | 5 | ||||||
| 5.4 | Depositary | 5 | ||||||
6. |
REPRESENTATIONS OF THE PURCHASER | 6 | ||||||
7. |
REDEMPTION OF THE BONDS | 6 | ||||||
| 7.1 | Mandatory Redemption | 6 | ||||||
| 7.2 | Redemption at Option of Lessee | 6 | ||||||
| 7.3 | Partial Redemptions | 7 | ||||||
| 7.4 | Maturity | 7 | ||||||
8. |
COVENANTS | 7 | ||||||
| 8.1 | Payment of Principal, Interest, and Premium | 7 | ||||||
| 8.2 | Performance of Covenants; Authority of the Issuer | 7 | ||||||
| 8.3 | Instruments of Further Assurance | 7 | ||||||
| 8.4 | Inspection of Project Books | 8 | ||||||
| 8.5 | Rights Under and Possession of the Lease | 8 | ||||||
| 8.6 | Recording and Filing | 8 | ||||||
| 8.7 | Maintenance of Existence; Compliance with Laws | 9 | ||||||
9. |
EVENTS OF DEFAULT AND REMEDIES | 9 | ||||||
| 9.1 | Events of Default | 9 | ||||||
| Page | ||||||||
| 9.2 | Acceleration | 10 | ||||||
| 9.3 | Other Remedies | 10 | ||||||
| 9.4 | Rescission | 11 | ||||||
| 9.5 | No Waivers or Election of Remedies | 11 | ||||||
10. |
REGISTRATION; TRANSFER; SUBSTITUTION OF THE BOND | 11 | ||||||
| 10.1 | Registration of the Bond | 11 | ||||||
| 10.2 | Transfer of the Bond | 12 | ||||||
| 10.3 | Replacement of the Bonds | 12 | ||||||
11. |
PAYMENTS ON THE BONDS | 12 | ||||||
12. |
AMENDMENT AND WAIVER | 13 | ||||||
| 12.1 | Requirements | 13 | ||||||
| 12.2 | Binding Effect, etc | 13 | ||||||
| 12.3 | Lease | 13 | ||||||
13. |
NOTICES | 13 | ||||||
14. |
SUBSTITUTION OF PURCHASER | 14 | ||||||
15. |
INTERPRETATION | 14 | ||||||
| 15.1 | Definitions | 14 | ||||||
| 15.2 | Construction of Certain Terms | 15 | ||||||
| 15.3 | Table of Contents; Titles and Headings | 15 | ||||||
16. |
MISCELLANEOUS | 15 | ||||||
| 16.1 | Successors and Assigns | 15 | ||||||
| 16.2 | Payments Due on Non-Business Days | 16 | ||||||
| 16.3 | Severability | 16 | ||||||
| 16.4 | Construction | 16 | ||||||
| 16.5 | Counterparts | 16 | ||||||
| 16.6 | Governing Law | 16 | ||||||
| 16.7 | No Liability of Issuer’s Officers | 16 | ||||||
| 16.8 | Third Party Beneficiary | 17 | ||||||
Exhibit A
— Form of Bonds
Exhibit B
— Form of Investment Letter
Bond Purchase Agreement
July 1, 2006
Xxxxxxxxx Farms, Inc. (Production Division),
a Mississippi corporation
(the “Purchaser”)
a Mississippi corporation
(the “Purchaser”)
Ladies and Gentlemen:
The Adel Industrial Development Authority (the “Issuer”), a public body corporate and politic
created and existing under the laws of the State of Georgia, agrees with you as follows:
Issuance of the Bonds
Authorization of the Bonds.
The Issuer has duly authorized the issuance and sale of $17,200,000 in principal amount of its
Revenue Bonds (Xxxxxxxxx Farms, Inc. (Production Division) Project), Series 2006 (the “Bonds,” such
term to include any such Bonds issued in substitution therefor pursuant to Section 10 of this
Agreement). The Bonds shall be substantially in the form set out in Exhibit A, with such changes
therefrom, if any, as may be approved by you and the Issuer. Certain capitalized terms used in
this Agreement are defined in Section 15 of this Agreement; references to an “Exhibit” are, unless
otherwise specified, to an Exhibit attached to this Agreement. Capitalized terms not otherwise
defined herein shall be defined as forth in the Lease Agreement of even date (the “Lease
Agreement”) between the Issuer and Xxxxxxxxx Farms, Inc. (Production Division) (the “Lessee”), a
Mississippi corporation.
Terms of the Bonds.
The Bonds shall be dated the date of Closing and shall be designated “Adel Industrial
Development Authority Revenue Bonds (Xxxxxxxxx Farms, Inc. (Production Division) Project), Series
2006.” The Series 2006 Bonds (the “Bonds”) shall be issued as a single, fully registered Bond
without coupons in an aggregate principal amount not in excess of $17,200,000 and shall be numbered
R-1, substantially in the form set forth in Exhibit A.
The Bonds shall bear interest from the date advances are made under this Agreement on the
outstanding principal amount thereof at the rate per annum of 6.00%, computed on the basis of a
360-day year for the number of days actually elapsed, payable on July 1, 2007, and annually
thereafter on July 1 of each year and shall mature on July 1, 2017 (each such date, a “Payment
Date”), unless earlier called for redemption.
The Bonds shall bear interest on any overdue installment of principal or premium, if any, and,
to the extent permitted by applicable law, on any overdue installment of interest, at the aforesaid
rate.
Security for the Bonds.
As security for the payment of the Bonds, the Issuer hereby assigns and pledges, and grants a
security interest in, all of its right, title, and interest in the Bond Rent and in the amounts
pledged pursuant to Section 5.1 and, pursuant to an Assignment and Security Agreement, dated the
date hereof (the “Assignment”) between the Issuer and the Purchaser, all of its right, title and
interest in the Lease Agreement (collectively, the “Security”) to the Bondholder, and this
Agreement shall be deemed a security agreement with respect to the security interest so created.
Limited Obligation.
The Bonds shall be special or limited and not general obligations of the Issuer giving rise to
no pecuniary liability of the Issuer, shall be payable solely from the Security, and shall be a
valid claim of the Bondholder only against the Security, which Security is hereby again
specifically pledged and assigned for the payment of the Bonds and shall be used for no other
purpose than to pay the principal of, and premium, if any, and interest on, the Bonds, except as
may be otherwise expressly authorized in the Bond Documents. The Bonds shall not constitute a
general or moral obligation of Xxxx County nor a debt, indebtedness, or obligation of, or a pledge
of the faith and credit or taxing power of, Xxxx County or the State of Georgia or any political
subdivision thereof, within the meaning of any constitutional or statutory provision whatsoever.
Neither the faith and credit nor the taxing power of the State of Georgia, Xxxx County, or any
political subdivision thereof is pledged to the payment of the principal of, or premium, if any, or
interest on, the Bonds or other costs incident thereto. The Issuer has no taxing power. Neither
the members of the Governing Body nor any person executing the Bonds shall be liable personally on
the Bonds by reason of the issuance thereof.
Sale and Purchase of the Bonds; Advances.
Subject to the terms and conditions of this Agreement, the Issuer shall issue and sell the
Bonds to you and you shall purchase from the Issuer, at the Closing provided for in Section 3, the
respective Bonds at the purchase price of 100% of the principal amount thereof. You shall pay the
purchase price of the Bonds by making advances to the Issuer, from time to time on or prior to
December 31, 2016, at the request of the Lessee, upon delivering to the Issuer documents conveying
to the Issuer good and marketable title to the Project, as such property now exists, subject to
those liens and encumbrances (if any) to which title to said property is subject on the date of
delivery of the Bond but excluding the Lessor Contracts. The parties hereto hereby agree and
stipulate, solely for purposes of this Agreement, that the value of the Project is equal to 100% of
the principal amount of the Bonds being purchased by you. All advances shall be immediately
deposited in the Project Fund and shall be held, invested, and disbursed as provided in this
Agreement. The purchase price of the Bonds may be disbursed in one or more advances, but your
obligation to pay the purchase price of the Bonds shall be reduced by each advance with respect to
the Bonds made hereunder, and any purchase price so advanced hereunder may not be repaid and then
re-advanced hereunder. Your obligation hereunder to make advances of the
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purchase price of the Bonds shall expire on December 31, 2016. All advances by you of the
purchase price of the Bonds under this Agreement shall constitute principal advanced under the
Bonds, shall bear interest at the rate provided in Section 1.2 from the dates of the advances until
paid, and shall be secured as provided in Section 1.3. All your rights under the Bonds and the
Bond Documents shall continue in full force and effect with respect to all such advances.
The principal represented by all advances of the purchase price of the Bonds hereunder,
including the date and amount of principal represented by each advance, shall be endorsed by you on
the Schedule of Advances attached to the Bonds with respect to which such advance is being made;
provided, however, that any failure by you to endorse such information on such Schedule shall not
in any manner affect the obligation of the Issuer to make payments of principal and interest in
accordance with the terms of the Bonds. The Issuer hereby irrevocably authorizes and directs you
to enter on the Schedule of Advances attached to the Bonds the date and amount of principal
represented by each advance of purchase price of the Bonds.
Closing.
The sale and purchase of the Bonds shall occur at the offices of Xxxxxxxxxx Xxxxxxxx LLP,
Suite 2800, 0000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000, at 10:00 a.m., local time, at a closing
(the “Closing”) on August ___, 2006, or on such other Business Day thereafter on or prior to
December 31, 2016, as may be agreed upon by the Issuer, the Lessee, and you. At the Closing the
Issuer shall deliver to you the Bonds duly executed in the form described in Section 1.2 and
registered in your name (or in the name of your nominees), against delivery by you to the Issuer or
its order of immediately available funds in the amount of the initial advance of the purchase price
therefor, which shall be immediately deposited in the Project Fund. If at the Closing the Issuer
shall fail to tender the Bonds to you as provided above in this Section, or any of the conditions
specified in Section 4 shall not have been fulfilled to your satisfaction, you may, at your
election, be relieved of all further obligations under this Agreement, without thereby waiving any
rights you may have by reason of such failure or such nonfulfillment.
Conditions to Closing.
Unless waived by you in writing, your obligation to purchase and pay for the Bonds at the
Closing is subject to the fulfillment to your satisfaction, prior to or at the Closing, of the
following conditions:
Representations and Warranties.
The representations and warranties of the Issuer and the Lessee in the Lease Agreement shall
be correct when made and at the time of the Closing.
Performance; No Default.
The Issuer and the Lessee shall have performed and complied with all agreements and conditions
contained in this Agreement and the Lease Agreement required to be performed or complied with by
them prior to or at the Closing and after giving effect to the issue and sale of
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the Bonds (and the application of the proceeds thereof as contemplated by the Lease Agreement)
no Event of Default under the Lessor Contracts shall have occurred and be continuing.
Purchase Permitted by Applicable Law, etc.
On the date of the Closing, your purchase of the Bonds shall (i) be permitted by the laws and
regulations of each jurisdiction to which you are subject, (ii) not violate any applicable law or
regulation, and (iii) not subject you to any tax, penalty, or liability (including, without
limitation, Regulation G, T, or X of the Board of Governors of the Federal Reserve System), under
or pursuant to any applicable law or regulation, which law or regulation was not in effect on the
date hereof.
Lease Agreement.
You shall have received in form and substance satisfactory to you original duly executed
counterpart of the Lease Agreement.
Lien Documents.
You shall have received in form and substance satisfactory to you (a) evidence to the effect
that all appropriate filings and other steps then necessary for perfection of the liens and
security interests created by this Agreement and in the Security, as against third party creditors
of and purchasers for value in good faith from the Issuer, have been taken, and (b) certified
copies of Requests for Information or Copies (Form UCC-11), or equivalent reports, listing all
effective financing statements that name the Issuer as debtor and that are filed in Xxxx County,
Georgia, together with copies of such financing statements, none of which shall cover the
collateral purported to be covered by this Agreement, except as shall be terminated on the date of
the Closing or as shall constitute Permitted Encumbrances.
Proceedings and Documents.
All corporate and other proceedings in connection with the transactions contemplated by this
Agreement and the other Bond Documents and all documents and instruments incident to such
transactions shall be satisfactory to you and your counsel, and you and your counsel shall have
received all such counterpart originals or certified or other copies of such documents as you or
they may reasonably request.
Project Fund.
Creation of the Project Fund.
There is hereby created by the Issuer and ordered established with the Depositary a trust fund
in the name of the Issuer to be designated the “Project Fund.” All advances of the purchase price
of the Bonds shall be immediately deposited into the Project Fund. The Depositary hereby accepts
and agrees to perform the duties and obligations as herein specified.
The Issuer hereby grants a security interest in the moneys and investments in the Project Fund
held by the Depositary for the benefit of the Bondholder and this Agreement shall be
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deemed a security agreement with respect to the security interest so created. The Depositary
shall be deemed to be (1) the secured party under the Uniform Commercial Code of Georgia, as
representative of the Bondholder, or (2) a bailee that under the Uniform Commercial Code of Georgia
holds collateral for the benefit of the Bondholder as secured party, in either case with an
obligation to use moneys in the Project Fund solely as provided herein. If as a result of the
occurrence of an Event of Default under this Agreement the Bondholder declares the unpaid principal
balance and accrued interest on the Bonds to be immediately due and payable, the Depositary shall,
upon the written direction of the Bondholder, apply all moneys in the Project Fund to the immediate
payment of the Bonds, in the same manner as a redemption. Any such application shall reduce and
discharge the amount then due and payable on the Bonds to the extent of such application. The
Depositary shall promptly notify the Lessee and the Issuer of the amount of such reduction.
Disbursements.
Moneys in the Project Fund shall be expended in accordance with the provisions of the Lease
Agreement, particularly Sections 4.03 and 4.04 thereof. The Depositary is hereby authorized and
directed to issue its checks for each disbursement required by the aforesaid provisions of the
Lease Agreement. The Depositary shall keep and maintain adequate records pertaining to the Project
Fund and all disbursements therefrom, and the Depositary shall, if requested by the Lessee, file an
accounting thereof with the Issuer and the Lessee.
Investments.
The Depositary shall invest and reinvest any moneys held in the Project Fund at the direction
of the Lessee as provided in the Lease Agreement, particularly Section 4.11 thereof. The
Depositary shall not be required to invest or reinvest any moneys in the Project Fund or any
earnings therefrom unless directed by the Lessee. The Depositary shall not be liable for interest
upon any moneys held in the Project Fund during any period of time that such moneys are uninvested.
Such investments shall be held by or under the control of the Depositary and shall be deemed at
all times a part of the Project Fund, and the interest accruing thereon and any profit realized
therefrom shall be credited to the Project Fund, and any loss therefrom shall be charged against
the Project Fund. The Depositary is directed to sell and convert to cash a sufficient amount of
such investments whenever the cash held in the Project Fund is insufficient to pay a requisition
for payment from the Project Fund when presented. Neither the Depositary nor the Issuer shall be
liable or responsible for any loss resulting from any such investment or resulting from the
redemption or sale of any such investment as herein authorized.
Depositary.
The Company is hereby designated as Depositary of the Project Fund. The Issuer and the
Bondholder may, from time to time, with the prior written consent of the Lessee, designate a
successor Depositary. All moneys received by the Depositary under this Agreement shall, until used
or applied as herein provided, be held in trust for the purposes for which they were received but
need not be segregated from other funds except to the extent required by this Agreement or by law.
In making any disbursement or payment from the Project Fund as provided herein, the Depositary may
rely upon all requisitions, certificates, and other items submitted to it pursuant to
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this Agreement, and the Depositary shall be relieved of all liability with respect to
disbursements or payments made in accordance with this Agreement. The Depositary shall be
protected in acting upon any requisition, certificate, or other item believed to be genuine and
correct and to have been signed or sent by the proper person or persons.
The duties of the Depositary hereunder shall be entirely administrative and not discretionary.
The Depositary shall be obligated to act only in accordance with written directions or written
instructions received by it as provided in this Agreement. The Issuer hereby waives any suit,
claim, demand, or cause of action of any kind that it may have or may assert against the Depositary
arising out of or relating to the execution or performance by the Depositary of this Agreement,
unless such suit, claim, demand, or cause of action is based upon the negligence or willful
misconduct of the Depositary.
Representations of the Purchaser.
You represent that you are purchasing the Bonds for your own account or for one or more
separate accounts maintained by you for investment purposes or for your loan portfolio and not with
a view to the distribution thereof, provided that the disposition of your property shall at all
times be within your control. You agree (1) to execute and deliver to the Issuer and the Lessee an
Investment Letter substantially in the form attached hereto as Exhibit B, at or prior to the
Closing, and (2) that the Bonds may not be resold unless the purchaser executes and delivers to the
Issuer and the Lessee an Investment Letter substantially in the form attached hereto as Exhibit B,
at or prior to such resale.
Redemption of the Bonds.
Mandatory Redemption.
The Bonds shall be subject to mandatory redemption by the Issuer prior to maturity on the
earliest available Payment Date from excess moneys in the Project Fund to the extent required in
Section 4.03(j) of the Lease Agreement. If the Bonds are called for redemption in the event
described in the preceding sentence, the Bonds shall be redeemed by the Issuer in a principal
amount equal to the excess moneys in the Project Fund at a redemption price equal to one hundred
percent (100%) of the principal amount being redeemed plus accrued interest to the redemption date,
but without premium or penalty.
Redemption at Option of Lessee.
The Bonds shall be subject to optional redemption by the Issuer upon the written request of
the Lessee prior to maturity, in whole on any date or in part on any Payment Date, and if in part
in amounts not less than $10,000, at a redemption price equal to one hundred percent (100%) of the
principal amount being redeemed plus accrued interest to the redemption date, but without premium
or penalty. As a condition precedent to each optional redemption under this Section, the
Bondholder shall receive written notice of such optional redemption not less than 30 days and not
more than 60 days prior to the date fixed for such redemption. Each such notice shall specify the
date of redemption and the principal amount of the Bonds to be redeemed on
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such date, and the accrued interest (if the same can be calculated) to be paid on the
redemption date with respect to the principal amount being redeemed.
Partial Redemptions.
Any partial redemptions of the Bonds shall be applied to the principal portions due on the
Bonds, and in the ratios of their respective principal amounts to the aggregate principal amount of
the Bonds.
Maturity.
In the case of each redemption of the Bonds pursuant to this Section, the principal amount of
the Bonds to be redeemed shall mature and become due and payable on the date fixed for such
redemption, together with interest on such principal amount accrued to such date and the applicable
premium, if any. From and after such date, unless the Issuer shall fail to pay such principal
amount when so due and payable, together with the interest and premium, if any, as aforesaid,
interest on such principal amount shall cease to accrue.
Covenants.
Payment of Principal, Interest, and Premium.
The Issuer covenants that it will promptly pay or cause to be paid the principal of, and
premium, if any, and interest on, the Bonds at the place, on the dates, and in the manner provided
herein and in the Bonds according to the true intent and meaning thereof, but solely from the
Security. The principal of, and premium, if any, and interest on, the Bonds are payable solely
from the sources as provided herein, which sources are hereby specifically pledged to the payment
thereof in the manner and to the extent specified herein, and nothing in the Bonds or in this
Agreement shall be construed as pledging any other funds or assets of the Issuer.
Performance of Covenants; Authority of the Issuer.
The Issuer covenants that it shall faithfully perform at all times any and all covenants,
undertakings, stipulations, and provisions contained in this Agreement, in the Bonds, and in all
proceedings pertaining thereto. The Issuer represents that it is duly authorized under the
Constitution and laws of the State, including particularly the Act, to issue the Bonds and to
execute this Agreement, and to pledge the Security pledged in the manner and to the extent set
forth herein, that all action required on its part for the issuance of the Bonds and the execution
and delivery of this Agreement have been duly and effectively taken, and that the Bonds in the
hands of the Bondholder are and will be the valid and enforceable obligations of the Issuer
according to the import thereof.
Instruments of Further Assurance.
The Issuer agrees that the Bondholder may defend its rights to the payments and other amounts
due under the Lease against the claims and demands of all persons whomsoever. The Issuer covenants
that it will do, execute, acknowledge, and deliver or cause to be done, executed, acknowledged, and
delivered such agreements and such further acts, instruments, and transfers
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as the Bondholder may reasonably require for the better assuring, transferring, conveying,
pledging, assigning, and confirming unto the Bondholder the Security. The Issuer covenants and
agrees that, except as herein and in the Lease Agreement provided, it has not and will not sell,
transfer, convey, assign, pledge, encumber, grant a security interest in, or otherwise dispose of,
or create or suffer to be created any lien, encumbrance, security interest, or charge upon, any
part of the Security or the income and revenues therefrom or of its rights under the Lease or enter
into any contract or take any action by which the rights of the Bondholder may be impaired.
Inspection of Project Books.
The Issuer covenants and agrees that all books and documents in its possession relating to the
Project and the income and revenues derived from the Project shall at all reasonable times be open
to inspection by such accountants or other agents as the Bondholder may from time to time
designate.
Rights Under and Possession of the Lease.
The Lease, duly executed originals or counterparts of which have been filed with you, set
forth the covenants and obligations of the Issuer and the Lessee, including provisions that
subsequent to the initial issuance of the Bonds and prior to its payment in full, the Lease may not
be effectively amended, changed, modified, altered, or terminated (other than as provided therein)
without the written consent of the Bondholder, and reference is hereby made to the Lease for a
detailed statement of such covenants and obligations of the Lessee under the Lease, and the
Bondholder in its own name or in the name of the Issuer may enforce all rights of the Issuer and
all obligations of the Lessee under and pursuant to the Lease, whether or not the Issuer is in
default hereunder.
So long as the Bonds remain outstanding, and for such longer period when required by the
Lease, the Issuer shall faithfully and punctually perform and observe all obligations and
undertakings on its part to be performed and observed under the Lease. The Issuer covenants to
maintain, at all times, the validity and effectiveness of the Lease and (except as expressly
permitted thereby) shall take no action, shall permit no action to be taken by others, and shall
not omit to take any action or permit others to omit to take any action, which action or omission
might release the Lessee from its liabilities or obligations under the Lease or result in the
surrender, termination, amendment, or modification of, or impair the validity of, the Lease.
The Issuer covenants to diligently enforce all covenants, undertakings, and obligations of the
Lessee under the Lease, and the Issuer hereby authorizes and directs the Bondholder to enforce any
and all of the Issuer’s rights relating to the payment of the Bond Rent under the Lease on behalf
of the Issuer.
Recording and Filing.
The Short Form Lease and the Assignment shall be recorded and indexed in the real estate
records of the Office of the Clerk of the Superior Court of Xxxx County, Georgia, and any other
place provided by law as the proper place for the recordation thereof. The security interest of
the Bondholder created by this Agreement shall be perfected by the filing of financing
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statements required to be filed pursuant to the State of Georgia Uniform Commercial Code or by
the taking of possession of appropriate collateral. Such financing or continuation statements
shall be filed from time to time, and the appropriate parties shall take or maintain possession of
appropriate collateral, as is necessary to preserve the security interest of this Agreement.
Maintenance of Existence; Compliance with Laws.
The Issuer shall at all times maintain its corporate existence or assure the assumption of its
obligations under the Lessor Contracts by any other entity succeeding to its powers. The Issuer
shall comply with all valid acts, rules, regulations, orders, and directions of any legislative,
executive, administrative, or judicial body known to it to be applicable to the Lessor Contracts.
Events of Default and Remedies.
Events of Default.
(a) If any of the following events occur, it is hereby defined as and declared to be and to
constitute a default and an “Event of Default”:
| (1) | default in the due and punctual payment of any interest on the Bonds, | ||
| (2) | default in the due and punctual payment of any principal of the Bonds (or premium thereon, if any), whether at the stated maturity thereof, or upon proceedings for redemption thereof, or upon the maturity thereof by declaration, | ||
| (3) | the occurrence of an “Event of Default” under any of the Lessee Contracts, | ||
| (4) | any material breach by the Issuer of any representation or warranty made in the Lessor Contracts or default in the performance or observance of any other of the covenants, agreements, or conditions on the part of the Issuer in the Lessor Contracts or in the Bonds contained, | ||
| (5) | the issuance of an order of relief by the Bankruptcy Court of the United States District Court having valid jurisdiction, granting the Issuer relief under federal bankruptcy law, or the issuance by any other court having valid jurisdiction of an order or decree under applicable federal or state law providing for the appointment of a receiver, liquidator, assignee, trustee, or sequestrator (or other similar official) of the Issuer or any substantial part of its property, affairs, or assets, and the continuance of any such decree or order unstayed and in effect for a period of sixty (60) consecutive days, or | ||
| (6) | the consent by the Issuer to the institution of proceedings in bankruptcy against it, or to the institution of any proceeding against it under any federal or state insolvency laws, or to the filing of any petition, application, or complaint seeking the appointment of a receiver, liquidator, assignee, trustee, or sequestrator (or other similar official) of the Issuer or of any substantial part of its property, affairs, or assets. |
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(b) Anything herein to the contrary notwithstanding, no default under Section 9.1(a)(1), (2),
(3), (4), and (6) shall constitute an Event of Default until actual written notice of such default
by registered or certified mail shall be given by the Bondholder to the Lessee and the Issuer, and
the Lessee and Issuer shall have had 30 days after receipt of such notice to correct such default
or cause such default to be corrected and shall not have corrected such default or caused such
default to be corrected within the applicable period; provided, however, if such default be such
that it cannot with due diligence be cured within the applicable period but can be wholly cured
within a period of time not materially detrimental to the rights of the Bondholder, to be
determined conclusively by the Bondholder, it shall not constitute an Event of Default if
corrective action is instituted by the Lessee or the Issuer, as the case may be, within the
applicable period and diligently pursued until the default is corrected in accordance with and
subject to any directions or limitations of time established by the Bondholder.
With regard to any alleged default concerning which notice is given to the Lessee under the
provisions of this Section, the Issuer hereby grants the Lessee full authority for the account of
the Issuer to perform any covenant or obligation alleged in such notice to constitute a default, in
the name and stead of the Issuer with full power to do any and all things and acts to the same
extent that the Issuer could do and perform any such things and acts and with power of
substitution.
In addition, the Bondholder shall give written notice of all other Events of Default by
registered or certified mail to the Lessee, provided, however, such notice shall not be a condition
precedent to the Bondholder exercising any right or remedy granted to it hereunder.
Acceleration.
If an Event of Default has occurred and is continuing, the Bondholder may at any time at its
option, by notice or notices to the Issuer and the Lessee, declare the Bonds to be immediately due
and payable.
Upon the Bonds becoming due and payable under this Section by declaration, the Bonds shall
forthwith mature and the entire unpaid principal amount of the Bonds plus all accrued and unpaid
interest thereon shall all be immediately due and payable, in each and every case without
presentment, demand, protest, or further notice, all of which are hereby waived.
Other Remedies.
Upon the occurrence of an Event of Default, you may, in your discretion, by written notice to
the Issuer and the Lessee, terminate your remaining commitment (if any) hereunder to make any
further advances of purchase price of the Bonds, whereupon any such commitment shall terminate
immediately.
If any Event of Default has occurred and is continuing, and irrespective of whether the Bonds
have become or have been declared immediately due and payable under Section 9.2, the
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Bondholder may
exercise any right, power, or remedy permitted to it by law or under the terms of the Bond
Documents and may proceed to protect and enforce the rights of the Bondholder by an action at law,
suit in equity, or other appropriate proceeding, whether for the specific performance of any
covenant or agreement contained herein, in the other Bond Documents, or in the Bonds, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of
any power granted hereby or thereby or by law or otherwise.
Rescission.
At any time after the Bonds have been declared due and payable pursuant to Section 9.2, the
Bondholder, by written notice to the Lessee and the Issuer, may rescind and annul any such
declaration and its consequences if (a) the Issuer has paid all overdue interest on the Bonds, all
principal of and premium, if any, on the Bonds that are due and payable and are unpaid other than
by reason of such declaration, and all interest on such overdue principal and premium, if any, and
(to the extent permitted by applicable law) any overdue interest in respect of the Bonds, at the
rate specified in the Bonds with respect to overdue payments, (b) all Events of Default, other than
non-payment of amounts that have become due solely by reason of such declaration, have been cured
or have been waived pursuant to Section 11, and (c) no judgment or decree has been entered for the
payment of any monies due pursuant hereto or to the Bonds. No rescission and annulment under this
Section shall extend to or affect any subsequent Event of Default or impair any right or power
consequent thereon.
No Waivers or Election of Remedies.
No course of dealing and no delay or omission on the part of the Bondholder in exercising any
right, power, or remedy shall operate as a waiver thereof or otherwise impair or prejudice the
Bondholder’s rights, powers, or remedies, but any such right, power, or remedy may be exercised
from time to time and as often as may be deemed expedient. No right, power, or remedy conferred by
this Agreement, by any other Bond Document, or by the Bonds upon the Bondholder shall be exclusive
of any other right, power, or remedy referred to herein or therein or now or hereafter available at
law, in equity, by statute, or otherwise, but each and every such right, power, or remedy shall be
cumulative and shall be in addition to every other right, power, or remedy given under this
Agreement, any other Bond Document, or the Bonds or now or hereafter existing at law, in equity, by
statute, or otherwise.
Registration; Transfer; Substitution of the Bond.
Registration of the Bond.
The Issuer shall keep at its office a register for the registration and registration of
transfers of the Bonds. The name and address of the Bondholder, each transfer thereof, and the
name and address of each transferee of the Bonds shall be registered in such register. Prior to
due presentment for registration of transfer, the Person in whose name the Bonds shall be
registered shall be deemed and treated as the owner and holder thereof for all purposes hereof
(including the receipt of payments of principal of, and premium, if any, and interest on, the
Bonds), whether or not the Bonds shall be overdue, and the Issuer shall not be affected by any
notice or knowledge to the contrary.
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Transfer of the Bond.
Upon surrender of the Bonds at the office of the Issuer for registration of transfer, duly
endorsed or accompanied by a written instrument of transfer duly executed by the registered owner
of the Bonds or its attorney duly authorized in writing and accompanied by the address for notices
of the transferee of the Bonds, the Issuer shall execute and deliver, at the Lessee’s expense
(except as provided below), a new Bond in exchange therefor, in a principal amount equal to the
unpaid principal amount of the surrendered Bond. Each such new Bond shall be payable to such
Person as the former Bondholder may request and shall be issued as a single, fully registered Bond
substantially in the form of Exhibit A. Each such new Bond shall be dated and bear interest from
the date to which interest shall have been paid on the surrendered Bond or dated the date of the
surrendered Bond if no interest shall have been paid thereon. The Issuer may require payment of a
sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such
transfer of the Bonds. The Bonds shall not be transferred in a denomination of less than the
unpaid principal amount of the surrendered Bonds. No transfer of the Bonds shall be made until (1)
the transferring Bondholder has caused its interest in the Bond to be endorsed to the order of the
transferee of the Bond and has assigned all of its right, title, and interest in this Agreement and
the Security to such transferee, and (2) the transferee has assumed in writing the transferring
Bondholder’s obligations under this Agreement and has executed and delivered to the Lessee and the
Issuer an Investment Letter substantially in the form of Exhibit B.
Replacement of the Bonds.
Upon receipt by the Issuer of evidence reasonably satisfactory to it of the ownership of and
the loss, theft, destruction, or mutilation of any Bond, and, in the case of loss, theft, or
destruction, of indemnity reasonably satisfactory to it (provided that, if the Bondholder is, or is
a nominee for, you or another Bondholder with a minimum net worth of at least $17,200,000, such
Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or, in the case
of mutilation, upon surrender and cancellation thereof, the Issuer at the expense of the Lessee
shall execute and deliver, in lieu thereof, a new single, fully registered Bond, dated and bearing
interest from the date to which interest shall have been paid on such lost, stolen, destroyed, or
mutilated Bond or dated the date of such lost, stolen, destroyed, or mutilated Bond if no interest
shall have been paid thereon.
Payments on the Bonds.
All sums becoming due on the Bonds for principal, premium, if any, or interest shall be paid
in lawful money of the United States by the method and at the address specified for such purpose by
the Bondholder in writing to the Lessee and the Issuer, without the presentation or surrender of
the Bonds or the making of any notation thereon, except that upon written request of the Lessee
made concurrently with or reasonably promptly after payment or redemption in full of the Bonds, you
shall surrender the Bonds for cancellation, reasonably promptly after any such request, to the
Lessee. Prior to any sale or other disposition of the Bonds held by you or your
nominee, you shall endorse thereon the amount of principal paid thereon and the last date to
which interest has been paid thereon.
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All payments of principal of the Bonds (whether at maturity or upon redemption), including the
date and amount of each payment, shall be endorsed by you on the Schedule of Payments and
Redemptions attached to the Bonds; provided, however, that any failure by you to endorse such
information on such Schedule shall not in any manner affect the obligation of the Issuer to make
payments of principal and interest in accordance with the terms of the Bonds. The Issuer hereby
irrevocably authorizes and directs you to enter on the Schedule of Payments and Redemptions the
date and amount of each payment of principal of the Bonds.
You shall permit the Issuer or the Lessee at any time during regular business hours to make at
your principal office an appropriate notation on the Bonds of payments of principal thereof, if at
least five days prior thereto the Issuer or the Lessee shall have given written notice of its
intention to do so and if it shall not have received from you a written confirmation that the
requested notation has been made.
In the event that on any date the Issuer shall pay less than the amount then due on the Bonds,
such partial payment shall be applied to the amounts then due in the following order of priority:
(i) reimbursable expenses and indemnities, (ii) accrued interest and premium, if any, on the Bonds,
(iii) principal of the Bonds, and (iv) any other amounts due under the Bonds or the Bond Documents.
Amendment and Waiver.
Requirements.
This Agreement and the Bonds may be amended, changed, and modified, and the observance of any
term hereof or of the Bonds may be waived (either retroactively or prospectively), by the written
agreement of the parties hereto, with (and only with) the prior written consent of the Lessee.
Binding Effect, etc.
Any amendment, change, modification, or waiver consented to as provided in this Section shall
be binding upon you and upon each future Bondholder and upon the Issuer without regard to whether
the Bonds have been marked to indicate such amendment, change, modification, or waiver. No such
amendment, change, modification, or waiver will extend to or affect any obligation, covenant,
agreement, or Event of Default not expressly amended, changed, modified, or waived, or impair any
right consequent thereon.
Lease.
The Issuer shall not amend, change, or modify the Lease, or waive the observance of any term
thereof, without the prior written consent of the Bondholder.
Notices.
All notices, certificates, and other communications provided for hereunder shall be in writing
and sent (a) by telecopy if the sender on the same day sends a confirming copy of such notice by a
recognized overnight delivery service (charges prepaid), or (b) by registered or
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certified mail
with return receipt requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent to the Bondholder at the address first
specified above or to the Issuer at the following address, or to such other address as any party
hereto shall have specified in writing to the other party:
| Adel Industrial Development Authority | ||
| 000 X. Xxxxx Xxxxxx | ||
| P.O. Box 854 | ||
| Adel, Georgia 31620-0854 | ||
| Attention: Chairman |
Notices under this Section will be deemed given only when actually received. A duplicate copy of
each notice, certificate, or other communication given hereunder shall also be given to the Lessee.
Substitution of Purchaser.
You shall have the right to substitute any one of your affiliates as the purchaser of the
Bonds, by written notice to the Issuer and the Lessee, which notice shall be signed by both you and
such affiliate, shall contain such affiliate’s agreement to be bound by this Agreement and shall
contain a confirmation by such affiliate of the accuracy with respect to it of the representations
set forth in Section 6. Upon receipt of such notice, wherever the word “you” is used in this
Agreement (other than in this Section), such word shall be deemed to refer to such affiliate in
lieu of you. In the event that such affiliate is so substituted as a purchaser hereunder and such
affiliate thereafter transfers to you the Bonds then held by such affiliate, upon receipt by the
Issuer and the Lessee of notice of such transfer, wherever the word “you” is used in this Agreement
(other than in this Section ), such word shall no longer be deemed to refer to such affiliate, but
shall refer to you, and you shall have all the rights of the original Bondholder under this
Agreement.
Interpretation.
Definitions.
In addition to the words and terms defined elsewhere herein, the following words and terms
shall have the meanings set forth below. When used herein, such words and terms shall have the
meanings given to them in this Section, unless the context or use clearly indicates otherwise.
“Business Day” means any day other than a Saturday, a Sunday, or a day on which commercial
banks in Atlanta, Georgia, are required or authorized to be closed.
“Default” means an event or condition the occurrence or existence of which would, with the
lapse of time or the giving of notice or both, become an Event of Default.
“Bondholder” means the Person in whose name the Bond is registered on the Bond registration
books kept and maintained by the Issuer.
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Construction of Certain Terms.
For all purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires, the following rules of construction shall apply:
(1) The use of the masculine, feminine, or neuter gender is for convenience only and
shall be deemed and construed to include correlative words of the masculine, feminine, or
neuter gender, as appropriate.
(2) Any defined term used in the singular preceded by “any” shall be taken to indicate
any number of the members of the relevant class.
(3) All words used herein in the singular or plural shall be deemed to have been used
in the plural or singular where the context or construction so requires. The definitions in
this Agreement are applicable whether the terms defined are used in the singular or the
plural.
(4) “Person” shall mean any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated organization
or government or any agency or political subdivision thereof.
(5) “Or” is not exclusive.
(6) All references in this instrument to designated “Sections” and other subdivisions
are to the designated Sections and other subdivisions of this instrument. The words
“herein,” “hereof,” “hereto,” “hereby,” and “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular Section or other subdivision.
(7) The term “hereafter” shall mean after, and the term “heretofore” shall mean before,
the date of execution and delivery of this Agreement.
Table of Contents; Titles and Headings.
The table of contents, the titles of the sections, and the headings of the subdivisions of
this Agreement are solely for convenience of reference, are not a part of this Agreement, and shall
not be deemed to affect the meaning, construction, or effect of any of its provisions.
Miscellaneous.
Successors and Assigns.
All covenants and other agreements contained in this Agreement by or on behalf of any of the
parties hereto bind and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent Bondholder) whether so expressed or not.
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Payments Due on Non-Business Days.
Anything in this Agreement or the Bonds to the contrary notwithstanding, any payment of
principal of, or premium, if any, or interest on, the Bonds that is due on a date other than a
Business Day shall be made on the next succeeding Business Day without including the additional
days elapsed in the computation of the interest payable on such next succeeding Business Day.
Severability.
Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such prohibition or unenforceability
in any jurisdiction shall (to the full extent permitted by law) not invalidate or render
unenforceable such provision in any other jurisdiction.
Construction.
Each covenant contained herein shall be construed (absent express provision to the contrary)
as being independent of each other covenant contained herein, so that compliance with any one
covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with
any other covenant. Where any provision herein refers to action to be taken by any Person, or
which such Person is prohibited from taking, such provision shall be applicable whether such action
is taken directly or indirectly by such Person.
Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be an
original but all of which together shall constitute one instrument. Each counterpart may consist
of a number of copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.
Governing Law.
This Agreement shall be construed and enforced in accordance with, and the rights of the
parties shall be governed by, the law of the State of Georgia excluding choice-of-law principles of
the law of such State that would require the application of the laws of a jurisdiction other than
such State.
No Liability of Issuer’s Officers.
No recourse under or upon any obligation, covenant, or agreement contained in this Agreement,
or in the Bonds, or for any claim based thereon, or under any judgment obtained against the Issuer,
or by the enforcement of any assessment or penalty or otherwise or by any legal or equitable
proceeding by virtue of any constitution, rule of law or equity, or statute or otherwise or under
any other circumstances, under or independent of this Agreement, shall be had against any
incorporator, member, director, or officer, as such, past, present, or future, of the Issuer, or
any incorporator, member, director, or officer of any successor corporation, as such,
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either
directly or through the Issuer or any successor corporation, or otherwise, for the payment for or
to the Issuer or any receiver thereof, or for or to the Bondholder or otherwise, of any sum that
may be due and unpaid by the Issuer under this Agreement or upon the Bonds. Any and all personal
liability of every nature, whether at common law or in equity, or by statute or by constitution or
otherwise, of any such incorporator, member, director, or officer, as such, to respond by reason of
any act or omission on his part or otherwise, for the payment for or to the Issuer or any receiver
thereof, or for or to the Bondholder or otherwise, of any sum that may remain due and unpaid under
this Agreement or upon the Bonds, is hereby expressly waived and released as a condition of and in
consideration for the execution of this Agreement and the issuance of the Bonds.
Third Party Beneficiary.
The Lessee is and shall be deemed to be a third party beneficiary of this Agreement. The
provisions of this Agreement are otherwise solely for the benefit of the Issuer and the Purchaser
and no other Person shall have any rights as a third party beneficiary of any of the provisions
hereof.
[SIGNATURES AND SEALS APPEAR ON FOLLOWING PAGE]
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Signatures and Seals
If you are in agreement with the foregoing, please sign the form of agreement on the
accompanying counterpart of this Agreement and return it to the Issuer, whereupon the foregoing
shall become a binding agreement between you and the Issuer.
| Very truly yours, | ||||||
| ADEL INDUSTRIAL DEVELOPMENT AUTHORITY | ||||||
(Seal)
|
By: | /s/ Xxx Xxxxxx | ||||
| Chairman | ||||||
Attest:
|
||
/s/ Xxxxx X. Xxxxxxxx |
||
Secretary |
||
| The foregoing is hereby agreed to as of the date thereof. | ||
XXXXXXXXX FARMS, INC. |
||
(PRODUCTION DIVISION) |
||
/s/ D. Xxxxxxx Xxxxxxxx |
||
Authorized Officer |
||
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Exhibit A
Form of Bonds
THIS BOND AND THE INSTRUMENTS HEREINAFTER DESCRIBED ARE SUBJECT TO AN INVESTMENT LETTER AGREEMENT
AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO THE TERMS
OF SUCH INVESTMENT LETTER AGREEMENT AND THE HEREINAFTER DESCRIBED BOND PURCHASE AGREEMENT.
UNITED STATES OF AMERICA
State of Xxxxxxx
Xxxx Industrial Development Authority
Revenue Bonds
(Xxxxxxxxx Farms, Inc. (Production Division) Project), Series 2006
Xxxx Industrial Development Authority
Revenue Bonds
(Xxxxxxxxx Farms, Inc. (Production Division) Project), Series 2006
Number X-0
|
Xxxxxxxxx Xxxxxx: $17,200,000 | |
Maturity Date: July 1, 2017
|
Dated: July 1, 2006 |
Registered Owner: Xxxxxxxxx Farms, Inc. (Production Division)
KNOW ALL MEN BY THESE PRESENTS that the Adel Industrial Development Authority (the “Issuer”),
a public body corporate and politic duly created and existing under the laws of the State of
Georgia, for value received, hereby promises to pay, but only from the source as hereinafter
provided, to the registered owner shown above, or registered assigns, the principal sum stated
above, or so much of the principal sum stated above as shall have been advanced and shall be
outstanding, as indicated on the Schedule of Advances and the Schedule of Payments and Redemptions
attached to this Bond, payable as provided herein.
The principal represented by all advances of purchase price of this Bond under the hereinafter
defined Bond Purchase Agreement, including the date and amount of principal represented by each
advance, shall be endorsed by the registered owner of this Bond on the Schedule of Advances
attached to this Bond; provided, however, that any failure by the registered owner of this Bond to
endorse such information on such Schedule shall not in any manner affect the obligation of the
Issuer to make payments of principal and interest in accordance with the terms of this Bond. The
Issuer hereby irrevocably authorizes and directs the registered owner of this Bond to enter on the
Schedule of Advances attached to this Bond the date and amount of principal represented by each
advance of purchase price of this Bond.
This Bond shall bear interest from the dates advances are made under the Bond Purchase
Agreement on the outstanding principal amount hereof at the rate per annum of 6%, computed on the
basis of a 360-day year for the number of days actually elapsed.
Interest on this Bond shall be payable on July 1, 2007 and annually thereafter on July 1 of
each year. Principal of this Bond shall be payable on July 1, 2017, unless earlier called for
redemption.
This Bond shall bear interest on any overdue installment of principal and, to the extent
permitted by applicable law, on any overdue installment of interest, at the aforesaid rate.
All sums becoming due on this Bond for principal, premium, if any, and interest shall be paid
in lawful money of the United States by the method and at the address specified for such purpose by
the registered owner of this Bond in writing to the Lessee and the Issuer, without the presentation
or surrender of this Bond or the making of any notation hereon, except that upon the written
request of the Lessee made concurrently with or reasonably promptly after payment or redemption in
full of this Bond, the registered owner of this Bond shall surrender this Bond for cancellation,
reasonably promptly after any such request, to the Lessee. Prior to any sale or other disposition
of this Bond the registered owner of this Bond shall endorse hereon the amount of principal paid
hereon and the last date to which interest has been paid hereon.
All payments of principal of this Bond (whether at maturity or upon redemption), including the
date and amount of each payment, shall be endorsed by the registered owner of this Bond on the
Schedule of Payments and Redemptions attached to this Bond; provided, however, that any failure by
the registered owner of this Bond to endorse such information on such Schedule shall not in any
manner affect the obligation of the Issuer to make payments of principal and interest in accordance
with the terms of this Bond. The Issuer hereby irrevocably authorizes and directs the registered
owner of this Bond to enter on the Schedule of Payments and Redemptions the date and amount of each
payment of principal of this Bond.
THIS BOND SHALL NEVER CONSTITUTE AN INDEBTEDNESS OR GENERAL OBLIGATION OF THE STATE OF
GEORGIA, THE COUNTY OF XXXX, GEORGIA, OR ANY OTHER POLITICAL SUBDIVISION OF THE STATE OF GEORGIA,
WITHIN THE MEANING OF ANY CONSTITUTIONAL PROVISION OR STATUTORY LIMITATION WHATSOEVER, NOR A PLEDGE
OF THE FAITH AND CREDIT OR TAXING POWER OF ANY OF THE FOREGOING, NOR SHALL ANY OF THE FOREGOING BE
SUBJECT TO ANY PECUNIARY LIABILITY HEREON. THE ISSUER HAS NO TAXING POWER. THIS BOND SHALL NOT BE
PAYABLE FROM NOR A CHARGE UPON ANY FUNDS OTHER THAN THE REVENUES PLEDGED TO THE PAYMENT HEREOF AND
SHALL BE A LIMITED OR SPECIAL OBLIGATION OF THE ISSUER PAYABLE SOLELY FROM THE FUNDS PROVIDED
THEREFOR IN THE BOND PURCHASE AGREEMENT. NO OWNER OF THIS BOND SHALL EVER HAVE THE RIGHT TO COMPEL
THE EXERCISE OF THE TAXING POWER OF THE STATE OF GEORGIA, THE COUNTY OF XXXX, GEORGIA, OR ANY OTHER
POLITICAL SUBDIVISION OF THE STATE OF GEORGIA TO PAY THE PRINCIPAL OF THIS BOND OR THE INTEREST OR
ANY PREMIUM HEREON, OR TO ENFORCE PAYMENT HEREOF AGAINST ANY PROPERTY OF THE FOREGOING, NOR SHALL
THIS BOND CONSTITUTE A CHARGE, LIEN, OR ENCUMBRANCE, LEGAL OR EQUITABLE, UPON ANY PROPERTY OF THE
FOREGOING OTHER THAN THE REVENUES PLEDGED TO THE PAYMENT HEREOF. NEITHER THE MEMBERS OF THE
GOVERNING BODY OF THE ISSUER NOR ANY PERSON EXECUTING THIS BOND SHALL BE LIABLE PERSONALLY ON THIS BOND BY REASON OF THE ISSUANCE HEREOF.
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This Bond is the only Bond of an authorized issue limited in original principal amount to
$17,200,000, authorized to be issued pursuant to a resolution duly adopted by the governing body of
the Issuer for the purpose of financing the costs of acquiring, constructing, and installing land,
buildings, improvements, fixtures, machinery, equipment, and other real and personal property
located within the corporate limits of the County of Xxxx, Georgia constituting poultry feed mill,
administration, hatchery, and live-haul facilities to be located on a tract of land containing
approximately 125 acres known as Xxxxxxxxxx Farm and located on US 41 South and adjacent to the
city limits of Adel, Georgia (the “Project”). The Project will be owned by the Issuer, and
Xxxxxxxxx Farms, Inc. (Production Division) (the “Lessee”), a corporation duly formed and existing
under and by virtue of the laws of the State of Mississippi, will lease the Project from the Issuer
pursuant to a Lease Agreement (the “Lease Agreement”), dated as of July 1, 2006, between the Issuer
and the Lessee. The Lessee is obligated pursuant to the Lease Agreement to pay to the Issuer such
rentals (the “Bond Rent”) as will always be sufficient to pay the principal of, premium, if any,
and interest on this Bond, as the same mature and become due, and under the Lease Agreement it is
the obligation of the Lessee to pay all expenses of operating and maintaining the Project in good
repair, to keep it properly insured, and to pay all taxes, assessments, and other charges levied or
assessed against or with respect to the Project.
The Issuer issued and delivered this Bond to Xxxxxxxxx Farms, Inc. (Production Division) (the
“Purchaser”) pursuant to, and the Purchaser purchased this Bond from the Issuer pursuant to, the
terms and conditions of a Bond Purchase Agreement (the “Bond Purchase Agreement”) and an Assignment
and Security Agreement (the “Security Agreement”), each dated as of even date herewith, between the
Issuer and the Purchaser. Pursuant to the Bond Purchase Agreement and the Security Agreement, to
secure the payment of the principal of, premium, if any, and interest on this Bond, the Issuer
assigned and pledged to the Purchaser, and granted a first priority security interest in, all of
its right, title, and interest in the Bond Rent and the Lease Agreement. Reference is hereby made
to Bond Purchase Agreement and the Security Agreement for a description of the security for this
Bond, the provisions, among others, with respect to the nature and extent of the security for this
Bond, the rights, duties, and obligations of the Issuer, the Lessee, and the registered owner of
this Bond, and the provisions regulating the manner in which the terms of Bond Purchase Agreement,
the Security Agreement, the Lease Agreement, and this Bond may be modified, to all of which
provisions the owner of this Bond, on behalf of itself and its successors in interest, assents by
acceptance hereof.
This Bond shall be issued as a single, fully registered Bond without coupons in the original
principal amount set forth on the face hereof. Upon surrender of this Bond at the office of the
Issuer for registration of transfer, duly endorsed or accompanied by a written instrument of
transfer duly executed by the registered owner of this Bond or its attorney duly authorized in
writing and accompanied by the address for notices of each transferee of this Bond, the Issuer
shall execute and deliver, at the Lessee’s expense (except as provided below), a new Bond in
exchange herefor, in a principal amount equal to the unpaid principal amount of the surrendered
Bond. Each such new Bond shall be payable to such person as the former registered owner of this
Bond may request and shall be issued as a single, fully registered Bond. Each such new
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Bond shall be dated and bear interest from the date to which interest shall have been paid on
the surrendered Bond or dated the date of the surrendered Bond if no interest shall have been paid
hereon. The Issuer may require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of this Bond. This Bond shall not be transferred in
a denomination of less than the unpaid principal amount of the surrendered Bond. No transfer of
this Bond shall be made until (1) the transferring registered owner hereof has assigned all of its
right, title, and interest in the Bond Purchase Agreement to the transferee of this Bond, and (2)
the transferee has assumed in writing the registered owner’s obligations under the Bond Purchase
Agreement and has executed and delivered to the Lessee and the Issuer an Investment Letter
substantially in the form of Exhibit B to the Bond Purchase Agreement.
This Bond shall be subject to optional redemption by the Issuer upon the written request of
the Lessee prior to maturity, in whole on any date or in part on any scheduled interest payment
date, and if in part in amounts not less than $10,000, at a redemption price equal to one hundred
percent (100%) of the principal amount being redeemed plus accrued interest to the redemption date,
but without premium or penalty. As a condition precedent to each optional redemption pursuant to
the preceding sentence, the registered owner of this Bond shall receive written notice of such
optional redemption not less than 30 days and not more than 60 days prior to the date fixed for
such redemption. Each such notice shall specify the date of redemption, the principal amount of
this Bond to be redeemed on such date, and the accrued interest to be paid on the redemption date
with respect to the principal amount being redeemed.
In the case of each redemption of this Bond, the principal amount of this Bond to be redeemed
shall mature and become due and payable on the date fixed for such redemption, together with
interest on such principal amount accrued to such date and the applicable premium, if any. From
and after such date, unless the Issuer shall fail to pay such principal amount when so due and
payable, together with the interest and premium, if any, as aforesaid, interest on such principal
amount shall cease to accrue.
This Bond is issued pursuant to and in full conformity with a resolution duly adopted by the
governing body of the Issuer under the authority of and in full conformity with an act titled
“Development Authorities Law,” codified as Chapter 62 of Title 36 of the Official Code of Georgia
Annotated, as amended (the “Act”). This Bond is not a general obligation of the Issuer but is
payable solely from the Bond Rent. Pursuant to the provisions of the Lease Agreement, Bond Rent
sufficient for the prompt payment when due of the principal of, premium, if any, and interest on
this Bond is to be paid to the registered owner of this Bond for the account of the Issuer and has
been and is hereby again duly pledged for that purpose. The obligations hereunder shall be limited
as provided in Section 36-62-10 of the Act. This Bond is issued by the Issuer to aid in the
financing or refinancing of a “project”; as such term is defined in the Act, to accomplish the
public purposes of the Act.
In certain events, on the conditions, in the manner, and with the effect set forth in the Bond
Purchase Agreement, the principal of this Bond may become or may be declared due and payable before
the stated maturity hereof, together with interest accrued hereon. Modifications or alterations of
the Bond Purchase Agreement, or of any supplements thereto, may be made only to the extent and in
the circumstances permitted by the Bond Purchase Agreement.
-4-
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 issuance of this Bond do exist, have
happened, and have been performed in due time, form, and manner as required by law in order to make
this Bond a valid and legal revenue obligation of the Issuer and that the issuance of this Bond,
together with all other obligations of the Issuer, does not exceed or violate any constitutional or
statutory limitation applicable to the Issuer.
IN WITNESS WHEREOF, the Adel Industrial Development Authority has caused this Bond to be
executed by its Chairman by his manual signature, has caused its official seal to be impressed
hereon, and has caused this Bond to be attested by its Secretary by his manual signature, all as of
July 1, 2006.
| Adel Industrial Development Authority | ||||||
| By: | ||||||
| Chairman | ||||||
(Issuer Seal) |
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Attest: |
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Secretary |
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SCHEDULE OF ADVANCES
| Date of | Amount of | Notation | Date of | Amount of | Notation | |||||||||||||||
| Advance | Advance | Made By | Advance | Advance | Made By | |||||||||||||||
/ /200 |
$ | |||||||||||||||||||
SCHEDULE OF PAYMENTS AND REDEMPTIONS
| Date of | Amount of | Notation | Date of | Amount of | Notation | |||||||||||||||
| Payment | Payment | Made By | Payment | Payment | Made By | |||||||||||||||
SCHEDULE OF PAYMENTS AND REDEMPTIONS
| Date of | Amount of | Notation | Date of | Amount of | Notation | |||||||||||||||
| Payment | Payment | Made By | Payment | Payment | Made By | |||||||||||||||
ASSIGNMENT AND TRANSFER
FOR VALUE RECEIVED, the undersigned, , hereby sells, assigns, and
transfers unto (Tax Identification or Social Security No. ) the within Bond and all rights thereunder (including all of its right,
title, and
interest in and to the Bond Purchase Agreement and the Lease Agreement referenced therein) and
hereby irrevocably constitutes and appoints attorney to transfer the within Bond on the books kept
for registration thereof, with full power of substitution in the premises.
Dated: |
||||||||
| Signature |
| NOTICE: | The signature(s) 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 whatsoever. |
Exhibit B
Form of Investment Letter
Investment Letter
,
Adel Industrial Development Authority
Adel, Xxxxxxx
Adel, Xxxxxxx
Xxxxxxxxx Farms, Inc. (Production Division)
Laurel, Mississippi
Laurel, Mississippi
| Re: | $17,200,000 Adel Industrial Development Authority Revenue Bonds (Xxxxxxxxx Farms, Inc. (Production Division) Project), Series 2006 |
Ladies and Gentlemen:
In consideration of the sale to the undersigned by the Adel Industrial Development Authority
(the “Issuer”) of one of the above-captioned Bonds (the “Bonds”) and in consideration of Xxxxxxxxx
Farms, Inc. (Production Division) (the “Lessee”) providing the source and the security for the
payment of the Bonds, the undersigned hereby represents, warrants, covenants, and agrees as
follows:
1. The undersigned is an “accredited investor” as defined in Rule 501(a) promulgated under the
Securities Act of 1933, as amended (the “1933 Act”).
2. The undersigned is purchasing the Bond for investment for its own account and is not
purchasing the Bond for resale or other disposition, and the undersigned has no present intention
of reselling or otherwise disposing of all or any part of the Bond or dividing its interest
therein, but the undersigned reserves the right to sell or otherwise dispose of the Bond as it
chooses. The undersigned agrees that it will not sell, transfer, assign, or otherwise dispose of
the Bond (1) unless it obtains from the purchaser and delivers to the Issuer and the Lessee an
agreement similar in form and substance to this Agreement and (2) except in compliance with the
1933 Act, the Securities Exchange Act of 1934, as amended (the “1934 Act”), any rules and
regulations promulgated under either Act, and the applicable securities laws of any other
jurisdiction, and in connection therewith, the undersigned agrees that it shall furnish to any
purchaser of the Bond all information required by applicable law.
3. The undersigned, through its agents and employees, has investigated the poultry feed mill,
administration, hatchery, and live-haul facilities to be located on a tract of land containing
approximately 125 acres known as Xxxxxxxxxx Farm and located on US 41 South and adjacent to the
city limits of Adel, Xxxx County, Georgia (the “Project”) to be financed or refinanced with the
proceeds of the Bond, and has investigated the Lessee, which will lease the Project from the
Issuer. The undersigned acknowledges that it has been furnished with or has been given access,
without restriction or limitation, to all of the underlying documents in
connection with this transaction, the Bonds, the Project, and the Lessee, as well as all other
information that a reasonable, prudent, and knowledgeable investor would desire in evaluating the
purchase of the Bonds The undersigned acknowledges that the Lessee and other knowledgeable parties
have made available to it and its representatives the opportunity to obtain any additional
information which it may desire and the opportunity to ask any questions it may desire of and
receive satisfactory answers from the Lessee concerning the security and the source of payment of
the Bonds, the Project, and the Lessee.
4. The undersigned acknowledges that the Bonds are limited obligations of the Issuer payable
solely from funds paid by the Lessee and from collateral furnished by the Lessee and that the Bonds
will not be a general obligation or indebtedness of the State of Georgia, the County of Xxxx,
Georgia, or any other political subdivision of the State of Georgia to which the faith and credit
or taxing power of any of the foregoing will be pledged. The undersigned further acknowledges that
the Issuer has no taxing power and receives no appropriations from the County of Xxxx, Georgia or
any other governmental body and that neither the members of the board of directors of the Issuer
nor any person executing the Bonds will be liable personally on the Bonds by reason of the
execution thereof.
5. In reaching the conclusion that it desires to acquire the Bonds, the undersigned has
carefully evaluated all risks associated with this investment and acknowledges that it is able to
bear the economic risk of this investment. The undersigned, by reason of its knowledge and
experience in financial and business matters, is capable of evaluating the merits and risks of the
investment in the Bonds. The representations in this letter shall not relieve the Lessee from any
obligation to disclose any information required by the documents entered into in connection with
the issuance of the Bonds or required by any applicable law.
6. If the proposal and offer herein contained is satisfactory to each of you, you may so
indicate by having the following acceptance executed by your duly authorized officers and by
returning a copy to us. This Investment Letter and your acceptance will then constitute an
agreement with respect to the matters herein contained as of the date hereof. This Investment
Letter is expressly for your benefit and may not be relied upon by any other party.
| Very truly yours, | ||||||
| By: | ||||||
| Authorized Officer | ||||||
| Accepted as of the date first above written: | ||||
| Adel Industrial Development Authority | ||||
By: |
||||
| Chairman | ||||
| Xxxxxxxxx Farms, Inc. (Production Division) | ||||
By: |
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Title: |
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