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HomeMy WebLinkAboutOrdinance #0997x ORDINANCE NO. 997 AN ORDINANCE authorizing the issuance of $2,00,000 aggregate principal amount Economic Development Rev- enue Bonds, Series 1983 (Transportation Equipment Marketing Company of America Project); the lending of the proceeds of said Bonds to Transportation Equipment Marketing Company of America, an Illinois corporation; the execution and delivery of a Loan, Mortgage and Security Agreement and Trust Indenture; approving the sale of said Bonds; and prescribing other matters relating thereto. WHEREAS, the City of Canton, Fulton County, Illinois (the "Issuer") is a municipal corporation and a unit of local gov- ernment of the State of Illinois and is authorized pursuant to the Industrial Project Revenue Bcnd Act Division 74 of Article Eleven of the Illinois Municipal Code, as supplemented and amended (the "Act"), to issue its revenue bonds to finance the acquisition, construction, reconstruction, repair, alteration, improvement, equipping and extension of eccnomic development projects; and WHEREAS, the Issuer proposes to issue $2,00,000 aggre- gate principal. amount Economic Development Revenue Bonds, Series 1983 (Transportation Equipment Marketing Company of America. Project) (the "Series 1983 Bonds") pursuant to a Trust Indenture dated as of December 1, 1983 (the "Indenture"), by and between the Issuer and the Trustee named therein (the "Trustee"); and WHEREAS, pursuant to a Loan, btortgage and Security Agreement dated as of December 1, 1983 {the "Loan Agreement"), by and between the Issuer and Transportation Equipment P~iarketing Company of America, an Illinois corporation (the "Borrower"), the Issuer proposes to lend 1-l~e hrc~ceeds from the sale of the Series 1983 Bonds to the Borrower in order to provide funds: (1) to acquire, equip and construct a manufacturing plant, and related facilities to be located in Canton, Illinois (the "Project") and (2) to pay necessary expenses incidental thereto; and WHEREAS, pursuant to the Loan Agreement the Borrower will grant the Issuer a mortgage on and security interest in the Project Real Estate described in the Loan Agreement; and WHEREAS, pursuant to the Loan Agreement the Borrower will execute and deliver to the Issuer one or more notes in a principal amount not to exceed $2,Fs00,000 (collectively the "Series 1983 Note"); and WHEREAS, pursuant to the Indenture, as security for the Series 1983 Bonds, the Issuer will assign to the Trustee all of the Issuer's right, title and interest in, under and to the Loan Agreement (except the Issuer's rights to issue Additional Bonds, to consent to supplements and amendments to the Loan Agreement and to be reimbursed and held harmless, which rights are herein col- lectively referred to as the "Unassigned Rights"), and the Series 1983 Note; and NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CANTON, FULTON COUNTY, ILLINOIS, AS FOLLOWS: Section 1. The construction of the Project and the pay- ment of necessary expenses incidental thereto are hereby authorized and determined to be in the public interest and in furtherance of the public purposes contemplated by the Act. Section 2. In order to provide funds to carry out the public purposes set forth in Section 1 hereof, there are hereby authorized to be issued the revenue bonds of the Issuer in the maximum principal sum of $2,600,000 each of which bonds shall be designated "Economic Development Revenue Bond, Series 1983 (Transportation Equipment Marketing Company of America Project)" (the "Series 1983 Bonds"). The Series 1983 Bonds shall be dated, shall be in sub- stantially such form and shall bear interest at the rate or rates per annum, a].l as set forth in the Indenture, shall be issuable as only as fully registered bonds in the denomination of $5,000 or any integral multiple thereof (provided, however, that one or more temporary bonds may be issued in substitution for or preliminary to the availability of bonds in definitive form), and shall mature and come due in such amounts and at such times as provided in Article III of the Indenture, interest being payable as provided -2- in the Indenture. The Series 1983 Bonds shall be subject to redemption prior to or at maturity at the times, under the circumstances, in the manner, at the prices and with the effect set forth in the Indenture. The Series 1983 Bonds shall be executed in the name of the Issuer by the manual or facsimile signature of the Mayor, shall be attested by the manual or facsimile signature of the City Clerk, shall have the corporate seal of the Issuer impressed or otherwise reproduced thereon and shall be authenticated by the endorsement of the Trustee. The facsimile signatures of both the Mayor and the City Clerk are hereby both authorized to be placed on the Series 1983 Bonds, the manual signature of the Trustee to authenticate the Series 1983 Bonds being a signature hereby required or permitted thereon. The Series 1983 Bonds and the interest thereon shall be limited obligations of the .Issuer, payable solely and only from the revenues and receipts derived by the Issuer from the Project pursuant to the Loan Agreement and the Series 1983 Note and other- wise as provided in the Indenture and the Loan Agreement. No recourse under or upon any obligation, covenant or agreement contained in the Indenture, or in any Series 1983 Bond thereby secured, or under any judgment obtained against the Issuer, or by the enforcement of any assessment or by any legal or equitable proceeding by virtue of any constitution or statute or otherwise or under any circumstances, under or independent of the Indenture, shall be had against any employee, trustee or officer, as such, past, present or future, of the Issuer, either directly or through the Issuer, or otherwise, for the payment for or to the Issuer or any receiver thereof, or for or to the holder or owner of any Series 1983 Bond issued under the Indenture or otherwise, of any sum that may be due and unpaid by the Issuer upon any such Series 1983 Bonds. The Series 1983 Bonds and the interest thereon shall never constitute an obligation or commitment by the Issuer to expend any of its funds other than (i) the proceeds of the sale of the Series 1983 Bonds, (ii) the revenues and receipts derived by the Issuer from the Project pursuant to the Loan Agreement, the -3- Series 1983 Note and the Indenture, (iii) any insurance or condem- nation award proceeds with respect to the Project, (iv) any money arising out of the investment or reinvestment of said proceeds, income, revenues or money, and (v) any proceeds derived by the Issuer or the Trustee from the sale or other disposition of the Project in accordance with the provisions of the Loan Agreement and the Indenture. Section 3. The Series 1983 Bonds shall be issued in compliance with and under the authority of the provisions of the Act, this Bond Ordinance and the Indenture and the foregoing shall be stated on the face of the Series 1983 Bonds. Additional Bonds may be issued on a parity with the Series 1983 Bonds in accordance with the provisions and limitations set forth in the Indenture. Section 4. The forms, terms and provisions of the Loan Agreement and the Indenture (collectively the "Instruments") are hereby in all respects approved, and the Mayor and City Clerk are hereby authorized, empowered and directed to execute and deliver the Instruments in the name and on behalf of the Issuer. The Instruments, as executed and delivered, shall be in substantially the forms thereof now before this meeting and hereby or previously approved, or with such changes therein as shall be approved by the officers of the Issuer executing the same, their execution thereof to constitute conclusive evidence of their approval of any and all changes or revisions therein from the forms of the Instruments now before this meeting; and from and after the execution and delivery of the Instruments the officers, agents and employees of the Issu- er are hereby authorized, empowered and directed to do all such acts ar~d things and to execute all such documents as may be neces- sary to carry out the intent and accomplish the purposes of this Band Ordinance and to comply with and make effective the provi- sions of the Instruments as executed, including the acceptance of additional security, which additional. security the Issuer hereby assigns to the Trustee to further secure the principal, premium, if any, and interest on the Series 1983 Bonds. -4- Section 5. The sale of the Series 1983 Bonds at a price of not less than 95$ of the par value thereof, as approved by the Borrower, is hereby approved. The Mayor and City Clerk are hereby authorized to enter into one or more bored purchase agreements with the purchaser or purchasers of the Series 1983 Bonds not inconsistent with the Instruments. Section 6. The Issuer covenants that it shall, prior to the issuance of the Bonds duly elect to have the provisions of Sec- tion 103(b)(6)(D) of the Internal Revenue Code of 1954, as amended (the "Code"), apply to such issuance, and such election shall be made in accordance with the procedures set forth in Section 1.103-10(b)(2)(vi) of the Regulations under Section 103 of the Code, or any successor provisions. The Issuer will make such filings as-may be necessary to effect the aforesaid election. The riayor and City Clerk, as the case may be, are hereby authorized and directed to execute and file such certificates or other documents to effect such election. The Mayor is hereby designated as the authorized or applicable elected representative of the Issuer in connection with the issuance of the Series 1983 Bonds, and the official of the Issuer charged with the issuance of the Bonds, public approval of the issuance thereof being hereby given as required by Section 103(k) of the Code. The required public hearing having been held and conducted, the approval hereof by the Mayor shall constitute approval of the authorized or applicable elected representative within the meaning of Section 103 (k) of the Code. Section 7. The provisions of this Bond Ordinance are hereby declared to be separable and if any section, phrase or pro- vision shall for any reason be declared by a court of competent jurisdiction to be invalid or unenforceable, such declaration shall not affect the validity of the remainder of the sections, phrases and provisions hereof. Section 8. All ordinances, orders and resolutions and parts thereof in conflict herewith are to the extent of such con- flict hereby repealed, and this Bond Ordinance shall take effect and be in full force immediately upon its adoption. -5- PASSED by the City Council of the City of Canton, Fulton County, Illinois this 20th day of December, 1983. APPROVED by the Mayor of the City of Canton, Fulton County, Illinois, this 20th day of December, 1983. ayor, City of Canton V Fulton County, Illinois Attest: Ci Clerk, City of Canton, Fulton County, Illinois -S - ~' STATE OF ILLINOIS ) CITY OF CANTON ) COUNTY OF FULTON ) I, Nancy Whites, hereby certify that I am the duly qualified and acting City Clerk of the City of Canton, Illinois, and as such official I further certify that attached hereto is a copy of excerpts from the minutes of the meeting of the City Council of said City of Canton held on December 20 1983; that I have compared said copy with the original minute record of said meeting in my official custody; and that said copy is a true, correct and complete transcript from said original minute record insofar as said original record relates to the adoption of an Ordinance as follows: "AN ORDINANCE authorizing the issuance of $2,00,000 aggregate principal amount Economic Development Reve- nue Bonds, Series 1983 (Transportation Equipment Marketing Company of America Project); the lending of the proceeds of said Bonds to Transportation Equipment Marketing Company of America, an I)_]_ir~ois corporation; the execution and delivery of a Loan, Piortgage and Security Agreement and Trust Indenture; approving the sale of said Bonds; and prescribing other matters relating thereto." WITNESS my official signature and the seal of said City of Canton this 21st day of December, 1983. ~/ , City .Clerk (SEAL) - 7- ,~ ~.r! , ` CITY OF CANTON, ILLINOIS AND TRANSPORTATION EQUIPA4ENT MARKETING COMPANY OF AMERICA, AN ILLINOIS CORPORATION (Transportation Equipment Marketing Company of America Project) LOAN, MORTGAGE AND SECURITY AGREEMENT DATED AS OF DECEMBER 1, 1983 The interest of the City of Canton, Illinois under this Loan, Mortgage and Security Agreement has been assigned by the City of Canton, Illinois to as Trustee, pursuant to a Trust Indenture dated as of December 1, 1983 . THIS INSTRUMENT PREPARED BY: Kurt P. Froehlich Evans & Froehlich RECORDER PLEASE RETURN TO: 44 Main Street Post Office Box 737 Champaign, Illinois 61820 `. ~ ~» ~~ TABLE OF CO;: i t::1; F ('~'hi~ Table of Contents is not a part of this Loan F.greerr~ent and is only for convenience of reverence.) Fage Parties ..................................................... 1 Granting Clauses ............................................ 2 ARTICLE I Definitions Section 1.1 Use of Defined Terms ......................... 5 Section 1.2 Definitions .................................. 5 Section 1.3 Certain Words Used Herein .................... 9 Section 1.4 P.eferences to Articles, Etc .................. 10 Section 1.5 Headings ..................................... 10 ARTICLE II Representations Section 2.1 Representations of the Issuer ................ 11 Section 2.2 Representations and Agreement of the Borrower ............................ 11 ARTICLE - I I I Acquisitior. and Construction of the Project; Issuance of the Bonds Section 3.1 Agreement to Acquire and Construct the Project ...................... 13 Section 3.2 Agreement to Issue Series 1983 Bonds; Application of Bond Proceeds; Additional Bonds ................. 13 Section 3.3 DisburGernents from the ConstYuction Fund .......................... 14 Section 3.4 Establishment of Completion Date ........... ........................... ~ 16 Section 3.5 to Pay Con- Borrower Required struction Costs in Event Con- struction Fund Insufficient ................ 16 Section 3.6 Enforcement of Remedies Against Contractors and Subcontractors and Their SuretieG ......................... 16 Section 3.7 Investment of Moneys in the Con- struction Fund, the Bond Fund and the Repair and Replacement Fund ....................................... 16 i ti'; ~ ' 1 hRTICLE IV The Loan; Loan Repayments; and Other Payments Page Section 4.1 The Loan............ ....................... 17 Section 4.2 Loan Repayments ..... ........................ 17 Section 4.3 No Defense or Set-Off ........................ 20 Section'4.4 Assignment or Issuer's Rights ................ 20 Section 4.5 Taxes and Other Payments ..................... 20 Section 4.6 nefeasance ................................... 22 Section 4.7 Additional Security .......................... 22 ARTICLE V Particular Covenants and Representations of the Borrower Section 5.1 Borrower to Maintain its Existence .................................. 24 Section 5.2 Indemnity .................................... 24 Section 5.3 Restriction on Conveyance .................... 24 Section 5.4 Covenant with Holders of Bonds ............... 25 Section 5.5 P.ecording and Filing ......................... 25 Section 5.6 Arbitrage Covenants .......................... 26 Section 5.7 Capital Expenditures .. ...................... 27 Section 5.8 Warranty of Title; Title Insurance ............. .................... 29 Section 5.9 Maintenance and Modification of Project by Borrower ........................ 29 Section 5.10 Insurance Required ........................... 30 Section 5.11 Application of Net Proceeds of Insurance ...... ........................... 31 Section 5.12 Additional Provisions Respect- ing Insurance .............................. 31 Section 5.13 Advances by Issuer or Trustee ................ 32 Section 5.14 Workmen's Compensation Coverage .............. 32 Section 5.15 Damage and Destruction ....................... 32 Section 5.16 Condemnation ................................. 34 Section 5.17 Condemnation of Property Not Constituting a Part of the Project ............... .. .............. 35 Section 5.18 Issuer's and Trustee's Right of Access to the Froject ...................... 35 Section 5.19 Release of Certain Land ...................... 36 Section 5.20 Granting of Easements ......... .............. 37 Section 5.21 Use of Party Walls ........................... 37 Section 5.22 Reserved ..................................... 38 Section 5.23 Installation of the Borrower's Own Machinery and Equipment ................ 38 Section 5.24 Removal of Project Equipment ................. 38 ii i' ...-': I CLE .': L'.'ent5 G` ~ efault aI1C: L.~ff~A~leS Pane Section 6.1 •• Events of Default and Remedies ............... 40 Section 6.2 Sale of Project .............................. 43 Section 6.3 Sale a Bar .. ................................ 43 Section 6.4 Receipt Sufficient Discharge for Purchaser .............................. 43 44 Section 6.5 Sale to Accelerate Notes ..................... Section 6.6 Application of Proceeds ...................... 44 Section 6.7 Appointment of Receiver ...................... 45 Section 6.8 Remedies Cumulative .......................... 46 Section 6.9 Delay or Gmission Not a Waiver ............... 46 Sectior. 6.10 Waiver of Extension, Appraise- ment, Stay, I•aws ........................... 46 Section 6.11 Remedies Subject to Provisions of Law ..................................... 46 ARTICLE VII Prepayment Section 7.1 Optional Prepayment .......................... 47 Section 7.2 Extraordinary Prepayment in Certain Events ............................. 48 Section 7.3 Mandatory Prepayment ......................... 50 Section 7.4 Manner of Prepayment ... ..................... 50 Section 7.5 Redemption of Bends With Prepayment Moneys .......................... 50 ARTICLE VIII piiscellaneous Sectien 8.1 Notices ...................................... 52 53 Section 8.2 Assignments .................................. Section 8.3 Severability ................................. 53 Section 4 8 Execution of Counterparts .................... 53 Section . 5 8 Amounts Remaining in Bond . Fund ....................................... 53 Section 8.6 Amendments, Changes and Modifications .............................. 53 Section 8.7 Governing Law ................................ 53 Section 8.8 Authorized Issuer and Borrower Representatives ................... 54 Section 8.9 Term of the Agreement ........................ 54 55 TESTIMO NIUM ................................................. 55 SIGiIATURES AND SEALS ........................................ 56 ACKNOWL EDGE MENTS ....... ...... ...... ...................... EXHIBIT A Description of the Project Real Estate ................................ 58 EXHIBIT B Description of Project Equipment ............. 59 EXHIBIT C Form of Series 1983 Note ..................... 60 iii a 'r ' r LOAI:, MORTGAGE AND SECURITY AGREEMENT THIS LOAN, MORTGAGE AND SECURITY AGREEMENT, made and entered into as of December 1, 1983, by and between the CITY OF CANTON, ILLINOIS, a municipal corporation and a unit of local government of the State of Illinois •(the "Issuer"), as lender, and Transportation Equipment Marketing Company of America, an Illinois corporation (hereinafter referred to as the "Borrower"). W I T N E S SET H: The parties hereto agree as follows (provided, that in the performance of the agreements of the Issuer herein contained, any obligation it may thereby incur for the payment of money shall r,ot constitute nor give rise to a pecuniary liability, in- aebtedness, or loan of credit of the Issuer, but shall be payable solely out of the proceeds derived from this Agreement and the sale of the Series 1983 Bonds referred to in Section 3.2 hereof, all as herein provided): -1- f ~ GF~NTING CLAUSES IN CONSIDERATION of the premises, the Borrower's Series 1983 `1c,te and other good and valuab]e consideration, the receipt whereof is hereby acknowledged and in order to secure the payment of the principal of, premium, if any, and interest payable on the Series 1983 Note and any Additional• Notes issued hereunder and any notes issued in substitution therefor (herein collectively referred to as the "Notes") and the performance of all the cove- nants of the Borrcwer contained herein, the Borrower has executed and delivered this Agreement and by these presents does assign, grant and mortgage, and grant a security interest in, to the Is- suer and its successors and assigns forever, all the Borrower's right, title and interest in, under and to any and all of the following described property, whether now owned or hereafter ac- quired: DIVISION I The Project Real Estate described in Exhibit A hereto, together with the entire interest of the Borrower (whether now owned or hereafter acquired) in and to the Project Real Estate and the entire interest of the Borrower in and to the Building and all buildings, structures, improvements and appurtenances now standing, or at any time hereafter constructed or placed upon the Project Reai Estate ,-including all right, title and interest of _- the Borrower, if any, in and to all on site building materials for the Project, fixtures of every kind and nature whatsoever on the Project Real Estate or in any building, structure or improve- ment now or hereafter standing on the Project Real Estate, and the reversion or reversions, remainder or remainders, in and to the Project Real Estate, and together with the entire interest of the Borrower in and to all and singular the tenements, heredita- ments, easements, rights of way, rights, privileges and appur- tenances to the Project Real Estate, belonging or in any wise appertaining thereto, including without limitation the entire right, title and interest of the Borrower, in, to and under any streets, ways or alleys adjoining the Project Real Estate and all claims or demands whatsoever of the Borrower either in law or in equity, in possession or expectancy of, in and to the Project Real Estate, it being the intention of the parties hereto that, so far as may be permitted by law, all property of the character described in this Division, which is now owned or is hereafter acquired by the Borrower and is affixed or attached to the Proj- ect Real Estate shall be and remain or become and constitute a portion of the Project Real Estate and the security covered by and subject to the lien hereof, and, subject to the terms and conditions hereof, together with all rents, income, revenues, issues, profits and proceeds thereof and therefrom. -2- ~ ' t LI~ISION II All Equip:~~ent described in Exhibit B attached hereto (as defined in Article 9 of the Illinois Uniform Commercial Code) now or hereafter awned or acquired by the Borrower for use at the Project and all products and proceeds therefrom and all substitu- tions or replacements therefor; - DIVISION III Any and all other property of every type and nature from time to time hereafter by delivery or by writing of any kind conveyed, mortgaged, assigned or transferred, or in which a security interest is granted, to the Issuer by the Borrower (or by anyone on behalf of the Borrower with his written consent) and the Issuer is hereby authorized to receive any and all such property at any and all times and apply the same to the terms hereof. - J "Authorized Iss~.:er Representative" means the person or persons at the time designated to act on behalf of the Issuer, if other than the Village President and/or Village Clerk, as provided in Section 8.8 hereof, by written certificate furnished to the Borrower and the Trustee, containing the specimen signa- ture or signatures of such person or persons and signed on behalf of the Issuer by the Village Presidnet or the Village Clerk of the Issuer. Such certificate or any subsequent or supplemental certificate so executed may designate an alternate or alternates. "Bonds" means the Series 1983 Bonds and any Additional Bonds issued under the Indenture. "Bond Counsel" means an attorney at law or firm of at- torneys of nationally recognized standing in matters pertaining to the tax-exempt nature of interest on bonds issued by states or their political subdivisions, duly admitted to the practice of law before the highest court of any state of the United States of America and who or which is satisfactory to the Trustee. "Bond Ordinance" means Ordinance No. of the Issuer, adopted on December 1983, which authorizes the issuance and sale of the Series 1983 Bonds. "Borrower" means Transportation Equipment Marketing Company of America, an Illinois corporation, its successors and assigns. "Building" means the building or buildings to be con- structed on the Project Real Estate, with the proceeds of the Se- ries 1983 Bonds, in accordance with the plans and specifications therefor. "Business Days" means the then current regular business days of the Trustee. "Code" means the Internal Revenue Code of 1954, as amended, and the applicable regulations of the Department of the Treasury promulgated thereunder. "Completion Date" means the date of completion of the Project as that date shall be certified as provided in Section 3.4 hereof. "Construction Fund" means the Construction Fund created in Section 602 of the Indenture and referred to herein. "Construction Period" means the period between the be- ginning of the construction of the Project or the date on which the Series 1983 Bonds are delivered to the Underwriter (whichever is earlier) and the Completion Date. -E- .~ i ` "Cost of the Project" means the sum of the items au- thorized to be paid from the Construction Fund pursuant to the provisions of Section 3.3 hereof. "Equipment" or "Project Equipment" means those items of machinery, equipment and related property (described in Exhibit B hereto) to be installed in or near the Building with proceeds from the sale of the Bonds, any payment by the Borrower pursuant to Section 3.5 hereof, which items as now contemplated by the current plans and specifications, include the machinery, equipment and related property that is generally described in Exhibit B hereto, and any such items acquired and constructed or installed in or near the Building in substitution therefor or in addition thereto pursuant to the provisions of this Agreement, less such property as may be released from this Loan Agreement or taken by the exercise of the power of eminent domain as provided herein, all as they may at any time exist but not including the Borrower's own machinery and equipment. "Indenture" means the Trust Indenture between the Is- suer and the Trustee dated as of December 1, 1983, as from time to time amended and supplemented. "Independent Architect" means an architect or firm of architects registered and qualified to practice the profession of architecture under the laws of the State of Illinois and who or which is not a full time employee of either the Issuer or the- Borrower and who or which is satisfactory to the Trustee. "Independent Counsel" means an attorney at law or firm of attorneys duly admitted to practice law before the highest court of any state and not a full time employee of either the Is- suer or the Borrower who or which is satisfactory to the Trustee. "Independent Engineer" means an engineer or engineering firm registered and qualified to practice the profession of en- gineering under the laws of the State of Illinois and who or which is not a full time employee of either the Issuer or the Borrower and who or which is satisfactory to the Trustee. "Issuer" means the City of Canton, Fulton County, Il- linois, an Illinois municipal corporation and unit of local government, and its successors and assigns. -7- ~~ "Letter of Credit" means or.e or more irrE>vocable Letters of Credit issued as of or after the date of the issuance of the Series 1983 Bonds by one or more Letter of Credit Banks in connection with the payment of 'the principal of and interest on the Series 1983 Bonds, not in conflict with this Loan Agreement. "Letter of Credit Bank" means one or more banks issuing a Letter of Credit. "Net Proceeds," when used with respect to any insurance or condemnation award, means the gross proceeds from the insur- ance or condemnation award with respect to which that term is used remaining after payment of all expenses (including attorney's fees and any extraordinary expenses of the Trustee) incurred in the collection of such gross proceeds. "Notes" means, collectively, the Series 1983 Note and any Additional Notes. "Permitted Encumbrances" means, as of any particular time, (i) liens for ad valorem taxes and special assessments not then delinquent, (ii) this Agreement, the Indenture, any lease of all or part of the Project subordinate to this Agreement, (iii) utility, access and other easements and rights of way, flood rights, mineral rights, encroachments, leases, restrictions and exceptions that the Authorized Borrower Representative certifies -- will not interfere with. or impair the operation of-the Project, (iv) such minor defects, irregularities, encumbrances, easements, rights of way, and clouds on title as normally exist with respect to properties similar in character to the Project and as do not in the opinion of Independent Counsel, materially impair the mar- ketable value or utility of .the property affected thereby for the purposes for which it was acquired or is held by the Borrower, (v) mechanics' and materialmen's liens not filed or perfected in the manner prescribed by law, as in effect on the date hereof or otherwise, (vi) unpaid taxes, assessments and other governmental charges of the type described in Section 4.5 hereof and which are due and owing, but only to the extent that the Borrower is con- testing such taxes, assessments or other governmental charges in acc~rdarce with the provisions of Section 4.5 hereof, (vii) filed or perfected mechanics' or other liens of the type described in Section 5.9 hereof, but only to the extent that the Borrower is contesting such mechanics' or other liens in accordance with the provisions of Section 5.9 hereof, and (viii) any other mortgage or lien not on a parity with or superior to the lien of this Agreement. -E- "Person" means an individual, partnership, corporation, trust or unincorporated association, and a government or agency or political subdivision thereof. "Project" means, collectively, the Project Real Estate, the Equipment, and the Building. "Project Real Estate" means the real estate described in Exhibit A attached hereto. "Qualified Investments" shall mean any investment not prohibited to the Issuer by law. Any such securities may be purchased at the offering or market price thereof at the time of such purchase. "Regulations" means the Income Tax Regulations (26 CFR Part 1) promulgated under and pursuant to the Code. "Reimbursement Agreement" means the Reimbursement Agreement, if any, by and between the Borrower and any Letter of Credit Bank in connection with any Letter of Credit, together with any mortgage, security interest or other lien securing the same. "Series 1983 Bonds" means the $2,500,000 aggregate principal amount Economic Development Revenue Bonds, Series 1983 (Transportation Equipment Marketing Company of America Project) of the Issuer authorized to be issued pursuant to the Indenture. "Series 1983 Note" means the Note from the Borrower to the Issuer in substantially the form attached hereto as Exhibit C, issued as one or more instruments in an aggregate amount not exceeding $2,500,000 equal to the Series 1983 Bonds issued under the Indenture. "State" means the State of Illinois. "Trustee" means the Trustee identified in the Indenture, and its successors in trust under the Indenture. "Unassigned Rights" means the rights of the Issuer to issue Additional Bonds, to execute and deliver (subject to the provisions of this Agreement and the Indenture) supplements or amendments to this Agreement and all of the rights of the Issuer to be held harmless, to be reimbursed for its expenses and to be indemnified hereunder. Section 1.3. Certain Words Used Herein. The words "hereof," h'r ein,~hereunder," and other words of similar im- port refer to this Agreement as a whole and not solely to the particular portion thereof in which any such word is used. The defined terms used herein include both singular and plural. -~- M ~ I ~•;5enever used herein, any pronoun shall be deemed to include both _ingular arm plural and to cover all gEnders. Section 1.4. References to Articles, Etc. References to articles, sections, ar~d other subdivisions of this Agreement are to the designated articles, sections, and other subdivisions of this Agreement as originally executed. Section 1.5. Headings. The headings of this Agreement are for convenience only and shall not define or limit the provi- sions hereof. (End of Article I) -10- ARTICLE II Representations Section 2.1. Representations of the Issuer. The Issuer makes the fallowing representations as the basis for the undertakings on its part herein contained: (a) The Issuer recognizes and agrees that the Project will, pursuant to the Indenture and this Agreement, secure the payment of the principal of, premium, if any, and inter- est on the Bonds. (b) The Issuer will issue up to $2,500,000 principal amount of Series 1983 Bonds dnd lend the proceeds therefrom to the Borrower to finance the Cost of the Project, all for the purposes set forth in the Act, to wit: to relieve conditions of unemployment and to encourage the increase of commerce and industry within the City of Canton, Illinois, thereby reducing the evils attendant upon unemployment and to provide for the increased welfare and prosperity of the residents of the City of Canton, Illinois. (c) The Series 1983 Bonds will be issued under-the- - "__ Act pursuant to the Bond Ordinance and will mature, bear interest, be redeemable and have the other terms and provisions set forth in the Indenture. (d) No covenant, warranty or representation of the Is- suer made herein, in any bond purchase agreement with a purchaser or purchasers of the Series 1983 Aonds, or in the Indenture shall be construed or interpreted to constitute a covenant, warranty or representation of the Issuer with re- spect to the acts or actions heretofore or hereafter taken by the Trustee or the Borrower in connection with said agreements. (e) The Issuer is a municipal corporation and unit of local government under Article VII of the 1970 Illinois Constitution. Section 2.2. Representations and Agreements of the Borrower. The Borrower represents and agrees as-the basis for the undertakings on its part herein contained: (a) The Borrower is an Illinois corporation validly existing and in good standing under the laws of the State of Illinois, duly authorized to transact business in and under the laws of the State of Illinois, and has the necessary power to enter into and perform under this Agreement, the Note and any Reimbursement Agreement. -11- (b) The Borrower presently inter, cis to operate the Project for industrial purposes as a manufacturing plant, anc related facilities or for any purpose permitted by the Act, through the date on which all of the Bonds are no longer outstanding under the Indenture. The Borrower will not use the Project or permit it to be used in contravention of the provisions of Section 103 of the Code. and particularly Section 103(b)(6)(O) thereof. (c) Neither the execution and delivery of this Agree- ment, the Note, or any Reimbursement Agreement, the consummation of the transactions contemplated hereby or thereby nor the fulfillment of or compliance with the terms and conditions of this Agreement, the Note or any Reimbursement Agreement, conflicts with or results in a breach of any of the terms, conditions or provisions of any agreement or instrument to which the Borrower is now a party or by which it is bound, or constitutes a default under any of the foregoing, or results in the creation or imposition of any lien whatsoever upon any of the property of the Borrower under the terms of any instrument or agreement (other than pursuant to this Agreement). (d) The Project constitutes and will constitute either land or property of a character subject to the allowance for depreciation under Section 167 of the Code,~and substanti- __._ ally all expenditures for Costs of the Project will be _ charged to a capital account for federal income tax purpos- es. (e) The Project, as designed, will comply with all presently applicable building and zoning ordinances and other applicable developmental regulations. (f) A substantial number of new jobs will ultimately be created by virtue of the acquisition and construction of the Project. _ `(End of Article II) -12- r ARTICLE III Acquisition and~Construction of the Project; Issuance of the Bonds Section 3.1. Agreement to Acquire and Construct the Project, The Borrower agrees that it will complete the acquisi- tion and construction of the Project as promptly as practicable, substantially in accordance with plans and specifications for the Project as such plans and specifications are identified and fur- ther detailed in the work orders or contracts of the Borrower re- lating to the Project, including any and all supplements, amend- ments and additions to such plans and specifications and work orders or contracts, and in accordance with change orders or con- tract amendments approved in writing by the Borrower from time to time prior to the Completion Date. Section 3.2. Agreement to Issue Series 1983 Bonds; Application of Bond Proceeds; Additional Bonds. In order to raise funds to lend the Borrower to finance the Cost of the Proj- ect as provided in Section 4.1 hereof, the Issuer agrees that it will issue, sell and cause to be delivered to the initial purchasers thereof the Issuer's Series 1983 Bonds, in an amount up to $2,500,OOD, bearing-interest and maturing as set forth in the Indenture. ~ The Issuer shall deposit the proceeds- from the ~ -------=- sale of the Series 1983 Bonds with the Trustee, to be held and disbursed by the Trustee in accordance with the provisions of the Indenture. Additional Bonds may be issued by the Issuer, at its discretion, upon compliance with Section 4.7 hereof, including an additional letter of credit, to pay the principal of and interest on such Additional Bonds to provide funds to pay any one or more of the following: (i) the costs of completing the Project; (ii) the cost of repairing, replacing or restoring the Project in the event of damage, destruction or condemnation of the Project in the event the net proceeds of insurance or condemnation proceeds are insufficient; (iii) the costs of making such additions and alterations, in, on, or to the Project as the Borrower may deem necessary or desirable and as will not impair the nature of the Project as a manufacturing plant, and related facilities; (iv) to refund any series of Bonds; and, in each such case, the costs of the issuance and sale of the Additional Bonds, capitalized inter- est for such period as may be permitted by the Act or the Code, and other costs reasonably related to the financing as shall be agreed upon by the Borrower and the Issuer. If the Borrower is not in default hereunder, the Issuer may, at its discretion, from time to time, use its best efforts to issue the amount of Additional Bonds specified by the Borrower; provided that the terms of such Additional Bonds, the purchase price to be paid therefor and the manner in which the proceeds therefrom are to be disbursed shall have been approved in writing by the Borrower. -13- r Section 3,3. Disbursements from the Construction Fund, pursuant tc t;;~ =r.~enture, the Issuer shall authorize and direct the Trustee to use moneys deposited in the Construction Fund for the purposes set rort_h ~n-the Act to pay the Cost of the Project (but, subject to the provisions of Section 3.7 hereof) namely: the sum total of all reasonable or necessary costs incidental to the acquisition, construction, reconstruction, repair, altera- tion, improvement and extension of the Project including without limitation the cost of studies and surveys, plans, specifica- tions, architectural and engineering services, legal, marketing or other special services; financing, acquisition, demolition, construction, equipment and site devel.opn~ent of new and rehabili- tated buildings, rehabilitation, reconstruction, repair or re- modeling of existing buildings and all other necessary and inci- dental expenses including an initial bond and interest reserve together with interest on bonds issued to finance the Project to a date six (6) months subsequent to the estimated Completion Date, and in no event beyond December 1, 1986. All proceeds of the Series 1983 Bonds, including moneys earned pursuant to the provisions of Section 3.7 hereof, remain- ing in the Construction Fund on the Completion Date, established pursuant to Section 3.4 hereof, and after payment of all other items provided for in the preceding paragraph, then due and pay- able shall at the direction of the Authorized Borrower Represen- tative be, to the extent permitted by law, used by the Trustee: (i) for the payment of any cost of construction not then due and payable; and/or (ii) for such other purposes (including, but not lim- ited to, the payment of the principal of and interest on the Series 1983 Bonds) as in the opinion of Bond Counsel will not under applicable statutes and regulations impair the exemption from Federal income tax of the interest on the Series 1983 Bonds. Each of the payments referred to in this Section shall be made from time to time, upon the Borrower's request, but only upon receipt by the Trustee of a written requisition of the Authorized Borrower Representative certifying: (1) the portion of the Project to which payment re- lates; (2) the payee, which may be the Borrower in the case of work performed by the Borrower's personnel; (3) the amount; (4) that the payment is due, is a proper charge against the Construction Fund and has not been the basis for any previous withdrawal from the Construction Fund; -14- J (5) that he or s'-:e has no notice of any vendor's, r:~~- c?:anic's or tether liens or right to liens, chattel mortcaoes or conditional sa]eG contracts, or other contracts or obli- gations which should .be satisfied or discharged before such payment is made, provided, however, that if any such con- tracts or obligations exist, the requisition shall be accom- panied by partial waivers of lien and/or evidence of the payment in full of such contracts or obligations acceptable to the Trustee and the Trustee may delegate examination of waivers of lien to any licensed title insurance company or bank; and (6) that the requisition contains no item representing payment on account of any retained percentages which, as of the date of requisition, are entitled to be retained; and (7) that all of the funds being requisitioned are be- ing used in compliance with Section 103 of the Code and Fegulations thereunder, and substantially all of the funds requisitioned thereby plus any other funds previously dis- bursed from the Construction Fund plus any future Construc- tion Fund disbursements are being or will be used for the acquisition, construction, reconstruction or improvement of land or property of a character subject to the allowance for depreciation as prescribed by Section 103(b)(6)(A) of the Code and the Regulations thereunder. -_ Notwithstanding any of the foregoing, each such certificate and requisition shall state that it is given without prejudice to any rights against third parties which exist as of the date of such certificate, or which may subsequently come into being. . Each requisition will be consecutively numbered and ac- companied by copies of invoices or other appropriate documenta- tion supporting the payments or reimbursements requested. Each requisition for payment or reimbursement for the cost of any per- sonal property or fixtures shall also be accompanied by proof of filing of Illinois Uniform Commercial Code Financing Statements which are sufficient to establish for the benefit of the Trustee a first perfected security interest in the personal property or fixtures for which payment or reimbursement is sought. In the case of any contract providing for the retention of a portion of the contract price, there shall be paid from the Construction Fund, prior to the Completion Date, only the net amount remaining after deduction of any such portion until such retention is payable, in which event payment may be made therefor from the Construction Fund. In making any such payment from the Construction Fund, the Trustee may rely on any such orders and certifications deliv- ered to it pursuant to this Section 3.3. ,~_ 1 J f Section 3.4. Est~.blishment of Completion Date. The ComplE*_icn Late shall be e~~le^ced to the Issuer and ~nE Trustee by a certificate- as to such co,:pletion date filed with the Trust- ee. Section 3.5. Borrower Required to Pay Construction Costs in Event Constructio F nn uu d Insufficient. The Borrower agrees to pay directly, or to deposit in the Construction Fund, moneys sufficient to pay such costs of completing the Project as will or may be in excess of the moneys available therefor in the Construction Fund. THE ISSUER DOES NOT MAKE ANY WARRANTY, EITHER EXPRESS OR IMPLIED, `!'HAT THE f•90NEYS WHICH WILL BE PAID INTO THE CONSTRUC`T'ION FUND AND WHICH UPdDER THE PROVISIONS OF THIS AGREE- MENT 4JILL BE AVAILABLE FOR PAYMENT OF THE COST OF THE PROJECT WILL BE SUFFICIENT TO PAY ALL THE COSTS WHICH WILL BE INCURRED IN THAT CONIJF,CTION. The Borrower agrees that if after exhaustion of the moneys in the Construction Fund the Borrower should pay or deposit moneys in the Construction Fund for the payment of any portion of the said Cost of the Project pursuant to the provi- sions of this Section, it shall not be entitled to any reimburse- ment therefor from the Issuer, the Trustee or from the holders of any of the Bonds, nor shall it be entitled to any diminution of the amounts payable under Section 4.2 hereof. Section 3.6. Enforcement of Remedies Against Contractors and Subcontractors and Their Sureties. The Borrower covenants - that it will take such action and institute such proceedings as -- shall be necessary to cause and require all contractors and ma- terial suppliers to complete their contracts diligently in accordance with the terms of said contracts, including, without limitation, the correcting of any defective work. All expenses incurred by the Borrower pursuant to this Section 3.6 shall be considered part of the Cost of the Project. Any amounts recovered by way of damages, refunds, adjustments or otherwise in connection with the foregoing prior to the Completion Date, less any unreimbursed legal expenses incurred in order to collect the same, shall be paid into the Construction Fund and after the Com- pletion Date shall be paid into the Bond Fund. Section 3.7: Investment of Moneys in the Construction Fund, the Bond Fund and the Repair and Replacement Fund. Subject to the provisions of Section 5.6 hereof, any moneys held as a part of the Construction Fund, the Bond Fund, the Repair and Re- placement Fund or any special trust fund arising from insurance or condemnation award proceeds, as the case may be, shall be in- vested or reinvested by the Trustee at the written direction of the Authorized Borrower Representative to the extent permitted by law in Qualified Investments. The interest accruing thereon and any profit realized therefrom shall be credited to the Fund in which such investments are held and any losses resulting from such investment shall be charged to such Fund and paid by the Borrower. (End of Article III) -?6- ARTICLE IV The Loan; Loan Repayments; and Other Payments Section 4.1. The Loan. The Issuer agrees, upon the terms and conditions set forth in this Agreement, to lend to the Borrower the proceeds received by the Issuer from the sale of the Series 1983 Bonds as may be required by the Borrower in order to pay for the Cost of the Project. Such proceeds shall be dis- bursed on behalf of the Borrower as provided in Section 3.3 here- of. To repay the loan, the Borrower agrees to make all payments when due as provided in Section 4.2 hereof. Section 4.2. Loan Repayments. Concurrently with the issuance and delivery of the Series 1983 Bonds, the Borrower shall execute and deliver the Series 1983 Note. Concurrently with the issuance and delivery of ary Additional Bonds, the Bor- rower shall execute and deliver an Additional Note. All Notes shall be in substantially the form attached hereto as Exhibit C and will: (a) be in the principal amount equal to the aggregate principal amount of the Bonds then being issued and sold (the "Related Bonds") and shall bear the same series de- scription as the Related Bonds; and (b) require installment payments-of principal and in- --. -- terest which will be sufficient to pay, when due, the prin- - cipal and interest payments required to be made on the Re- lated Bonds. -The Borrower shall duly and punctually pay the princi- pal of, premium,. if any, and interest on the Notes, in the manner provided therein; otherwise the Trustee shall present to the appropriate Letter of Credit Bank, if any, a draft pursuant to and in accordance with the applicable Reimbursement Agreement and such Letter of Credit as required to .pay the principal of, premium, if any, and interest on the Series 1983 Note and the Series 1983 Bond at the times, in the manner and with the effect as set forth in this Agreement and the Indenture. The payments hereunder of principal and interest pay- able by the Borrower hereunder are expected to be in an amount which, with other funds in the Bond Fund then available for the payment of Bonds, shall be sufficient to provide for the payment in full of the interest on and principal, including sinking fund requirements of the Bonds, if any are required by the Indenture, as they become due and payable. In the event such payments are not sufficient for such purposes, the Borrower covenants and agrees to pay any deficiency in connection therewith. -1?- l.r: ~' ~OliCW1nC ar~~ounts, SU~'~cCt tC t~~~ ~C~'1 S1v715 G~ subsection (z) below s?~a_1 be creci`_ed to the Bond ^und: (w) As a credit against the ar.~aunts payable as inter- est: (i) the amount of accrueC interest received from the purchaser or purchasers of the Series 1983 Bonds or any Ad- ditional Bonds at the time of delivery of such Bonds, (ii) the amount of any interest which may be capitalized in any series of Bonds, (iii) the amount, if any, transferred from the Construction Fund to the Bond Fund pursuant to Section 503 of the Indenture, (iv) the allocable portion of the Net Proceeds of insurance carried pursuant to Section 5.10 of this Agreement, (v) the amount deposited as a prepayment of principal and interest to the extent specified by the Bor- rower, and (vi) the amount of the net income or earnings re- ceived from the investment of moneys in the Bond Fund. (x) As a credit against the amounts payable as princi- pal (i) any amount deposited in the Bond Fund as a prepay- ment of principal and interest to the extent specified by the Borrower, and (ii) the aggregate amount of any credit allowed for interest payments under paragraph (w) above. (y) As a credit against the amounts payable into any sinking fund which may be established pursuant to the Inden- ture: (i) any amount deposited in such sinking fund as a prepayment of principal (and interest to the extent speci---.. fied by the Borrower and not applied to the payment of in- terest on any other Bonds), and (ii) the principal amount of the Series 1983 Bonds maturing in respect of any such sinking fund shall be credited against the amount of each sinking fund requirement in chronological order of the sink- ing fund requirements until the full amount of such Series 1983 Bonds have been so credited. There shall also be allowed as a credit against any such sinking fund requirement, the aggregate amount of any credit payable as to interest which is in excess of the amount payable under paragraph (i) above. (z) A Letter of Credit or Rein-bursement Agreement may provide, but shall not be required to provide, that no payment or prepayment by the Borrower pursuant to subsections (w), (x) and (y) above, or otherwise to this Agreement, shall constitute a credit to the Bond Fund unless such payment or prepayment has been .or will be a part of the Bond Fund for not less than 91 days preceding the date that such payment or prepayment is to be applied to the payment of the principal of, premium, if any, and interest on the Series 1983 Bonds, during which no act or event which with the passage of time or the giving of notice, or both, could give rise to an event of default under Section 6.1(c) hereof shall exist or be continuing. -18- rav:-,ents by the Borrower u::der `_r:e .rotes shall be :jade directly to the Trustee for tt~e account of t ;e Issuer and shall constitute payments of such amounts on the loan under Section 4.1 hereof; and the Bonds shall be payable from such payments to the Trustee of the principal of, premium, if any, and interest on the Notes delivered hereunder. Payments~of principal of, premium, if any, and interest on a series of Bonds shall be deemed to be like payments with respect to the Note issued concurrently with the issuance of such Bonds. 64henever any series of Bonds is redeemable, the Issuer will redeem the same upon the request of the Borrower subject to the provisions of subsection (z) of this Section 4.2, will pay an amount equal to the redemption price as a prepayment of principal, premium, if any, and interest due on the Note issued concurrently with the issuance of such Bonds. Whene~~er payment or provision therefor has been made in respect of the principal of (whether at maturity or upon redemption or acceleration), premium, if any, or interest on, all or any portion of a series of Bonds in accordance with the Indenture, the corresponding Note shall be deemed paid to the extent such payment or provision therefor has been made and is considered to be a payment of principal of, premium, if any, or interest on such Bonds. If such Bonds are thereby deemed paid in full, the corresponding Note shall be cancelled and returned to the Borrower. Subject to the foregoing or unless the Borrower is entitled to a credit under this Agreement, all payments-shall be - - in the full amount required under the Notes. All Notes, whether issued in connection with the Series 1983 Bonds or Additional Bonds, shall equally and ratably secure all Outstanding Bonds. In the event the Borrower shall fail to make any of the payments required by the Notes or in this Section 4.2, the pay- ment so in default shall continue as an obligation of the Borrow- er until the amount in default shall have been fully paid and the Borrower will pay interest on any overdue principal and, to the extent permitted by law, interest on any overdue interest, at the rate per annum which i~ equal to higher of (i) the maximum rate per annum borne by any of the Bonds Outstanding under the Indenture and in the form of the Series 1983 Note or (ii) the prime interest rate of Continental Illinois National Bank and Trust Company of Chicago, Chicago, Illinois., plus one percent (1~), per annum. -lS- Section 4.3. No Defense or Set-Off. The obligations G~ the 9orroti~er t~ R:a.~:E ~ C1r C::~LISe tC` G'°_ :jade, t:'1~' D;1'.':1~_'ntS required hereunder and under the Notes =hall be absclute and unconditional without de~ense or set-off by reason of any default by the Issuer under this Agreement or under any c~tl-ier agreement between the Borrower and the Issuer or for any other reason, in- cluding, without limitation, failure~to complete the Project, any acts or circumstances that may constitute failure of consideration, eviction or constructive eviction, any destruction of or damage to the Project or any part thereof, any condemnation of the Pro- ject or any part thereof, commercial frustration of purpose, any change in the tax or other laws or administrative rulings of or administrative actions by the United States of America or the State of Illinois or any political subdivision of either, or any failure of the Issuer to perform and observe any agreement, whether express or implied, or any duty, liability or obligation arising out of or connected with this Aaree~~~ent, it being the in- tention of the parties that the payments required hereunder will be paid in full when due without any delay or diminution whatso- ever. Section 4.4. Assignment of Issuer's Rights. As secur- ity for the payment of the Bonds, pursuant to the Indenture the Issuer will, and does hereby, assign to the Trustee the Issuer's rights under this Agreement (except the Unassigned Rights) and the Notes, including, but not limited to, the rights to receive payments hereunder, and under the Notes and under the Lease .- Agreement and to exercise all remedies hereunder, and hereby directs the Borrower to deliver, or cause to be delivered, such payments to the Trustee. The Borrower hereby consents to such assignment and will make, or cause to be made, payments directly to the Trustee without defense or set-off by reason of any dispute between the Borrower and the Issuer or between the Borrower and the Trustee. The Borrower hereby assigns to the Issuer, for further assigning by the Issuer to the Trustee, its rights under any lease agreement in connection with the Project, including the right to receive rentals and other payments. Section 4.5.E Taxes and Other Payments. (a) The Bor- rower will pay, or cause to be paid, as the same become due, all taxes and governmental charges of any kind whatsoever that may at any time be lawfully assessed or levied against or with respect to the Project or any machinery, equipment or other property in- stalled by the Borrower thereon (including, without limiting the generality of the foregoing, any taxes levied upon or with respect to the income and revenues of the Issuer pursuant to this Laan Agreement and the Notes which, if not paid, will become a lien on the Project prior to or on a parity with the lien of the Indenture or this Loan Agreement), all utility and other charges incurred in the operation, maintenance, use, occupancy and upkeep of the Project and all assessments and charges lawfully made by any governmental body for public improvements that may be secured by -2C- a lien on the Project; providE.d, that with resoect to special as- S°SSP.;?r:tS Or other Co!'e:r?.~~~:,tal C.r;arCFS t~'iat T'.a}' law~ull}' ~~° pald in installments over a period oI years, the Borrower shall be ob- ligated to pay only such installments as are required to be raid during the term of this Loan Agreement. If the Borrower shall first notify the Trustee of its intention so to do, the Borrower may, at its expense and in its own name and behalf, in good faith contest any such taxes, assess- ments and other charges and, in the event of any such contest, may permit the taxes, assessments or other charges so contested to remain unpaid during the period of such contest and any appeal therefrom unless the Trustee shall notify the Borrower that, in the opinion of Independent Counsel, by nonpayment of any such items the lien of the Indenture or this Loan Agreement will be materially endangered or the Project or any material part thereof will be subject to imminent loss or forfeiture, in which event such tares, assessments or charges shall be paid promptly. The Borrower agrees that it will not allege or argue in any such con- test that the Project is exempt from taxation by the Issuer. In the event that the Borrower shall fail to pay any of the forego- ing items required by this Section to be paid by the Borrower, the Issuer or the Trustee may (but shall be under no obligation to) pay the same, and any amounts so advanced therefor by the Is- suer or the Trustee shall become an additional obligation of the Borrower to the one making the advancement. (b) The Borrower agrees to pay to the Trustee until the principal of, premium, if any, and interest on the Bonds shall have been fully paid or provision for the payment thereof shall have been made in accordance with the provisions of the In- denture, from time to time reasonable compensation for all ser- vices rendered by the Trustee hereunder and under the Indenture, and also reimbursement for all reasonable expenses, charges, counsel fees and other disbursements, incurred in the performance of its powers and duties hereunder and under the Indenture and the enforcement of all rights and remedies hereunder and under the Indenture in accordance with the provisions of Section 1102 of the Indenture. The~Borrower may, without creating a default hereunder or under the Indenture, contest in good faith the necessity for any such services and the reasonableness of any such fees, charges or expenses. (c) In the event the Borrower should fail to make any of the payments required under this Section 4.5 the item or in- stallment so in default shall continue as an obligation of the Borrower until the amount in default shall have been fully paid, and the Borrower agrees to pay the same with interest thereon to the extent permitted by law at the maximum rate described in Section 4.2 hereof in connection with overdue principal and interest. -~~- Section 4.6. Defeasance. If the Borrower shall day and discharge t:^.e whole an~cur~*_ of tti-:e prir,ciaal or a:;d interest on the loan made hereunder at the time outstanding; and shall pay or cause to be paid all other sums pa}•able hereunder, then and in that case all property, rights and interests hereby conveyed or assigned or pledged shall revert to the Borrower, and the estate, right, title and interest of the Issuer therein shall thereupon cease, terminate and become void; and this Agreement and the cov- enants of the Borrower contained herein, shall be discharged and the Issuer in such case, on demand of the Borrower and at its cost and expense, shall execute and deliver to the Borrower a proper instrument or proper instruments acknowledging the satisfaction and termination of this Agreement, and shall convey, assign and transfer or cause to be conveyed, assigned or transferred, and shall deliver or cause to be delivered to the Borrower, all property, including money, then held by the Issuer pursuant to this Aaree:nent. Section 4.7. Additional Security. Prior to the initial delivery of the Series 1983 Bonds to the original purchaser(s) thereof, or at such other time after such date as such original purchaser(s) shall agree, the Borrower shall obtain and deliver, or cause to be obtained and delivered, to the Trustee any Letter of Credit such original purchaser(s) may require in connection with the payment of the principal of, premium, if any, and interest on the Series 1983 Bonds, due and- payable, by maturity, prepayment, redemption, acceleration or otherwise, on each principal and interest payment date of the Series 1983 Bonds, as additional security for the payment of principal of, premium, if any, and interest on the Series 1983 Bonds. Prior to the initial delivery of any series of Additional Bonds to the purchaser or purchasers thereof, the Borrower shall, as may be required by such purchaser or pur- chasers, also obtain and deliver to the Trustee, for the benefit of the holders of such Additional Bonds, an irrevocable letter of credit which shall be in an amount and contain such other provisions as may be required by such purchaser or purchasers in connection with such Additional Bonds, due and payable, by maturity or redemption, or otherwise, on each principal and interest payment date of such Additional Bonds, as additional security for the payments of the principal of, premium, if any, and interest on such Additional Bonds; provided, however, that each issue of any such Additional Bonds shall be secured by its own, separate and individual letter of credit, and any such letter of credit shall not secure any part of the issue of the Series 1983 Bonds issued under the Indenture other than the issue of Bonds, or part thereof, in conection with which the letter of credit was issued. ~' ~ SUBJECT, HOWEVER, to Permitted Encumbrances, as defined in Article I hereof; ,TO HAVE AND TO HOLD all and singular, the above de- scribed property, whether now owned or hereafter acquired, unto the Issuer, its successors and assigns forever; provided, how- ever, that this Agreement is upon the express condition that if the Borrower shall pay or cause to be paid all indebtedness se- cured hereby and shall keep, perform and observe all and singular the covenants and promises in the Notes and in this Agreement ex- pressed to be kept, performed and observed by the Borrower, then this Agreement and the rights hereby granted shall cease, deter- mine and be void, otherwise to remain in full force and effect. This Agreement shall be deemed to be a security agree- ment for purposes of the Illinois Uniform Commercial Code - Secured Transactions. The Borrower and the Issuer hereby further covenant and agree as follows: v . ~ - :' ARTICLE I Definitions Section 1.1. Use of Defined Terms. The terms defined in this Section 1.1 (except as herein otherwise expressly provid- ed, or unless the context otherwise requires) for all purposes of this Agreement shall have the respective meanings specified in this Section 1.1. Terms which are not defined in this Article I shall have the meanings specified in Section 101 of the Indenture (except as herein otherwise expressly provided or unless the context otherwise requires.) Section 1.2. Definitions. The following terms are de- fined terms under this Loan Agreement: "Act" means Industrial Project Revenue Bond Act Division 74 of Article Eleven of the Illinois Municipal Code, as supplemented and amended. "Additional Bonds" means the additional parity Bonds authorized to be issued by the Issuer pursuant to the terms and conditions of Section 210 of the Indenture and Section 3.2 here- of . "Additional Note" or "Additional Notes"- means the note or notes from the Borrower to the Issuer, executed by the Borrow- er in connection with the issuance of Additional Bonds. "Additional Security" means any mortgage, security interest, pledge or lien to secure the Borrower's obligations to reimburse any Letter of Credit Bank in correction with a Letter of Credit. , "Agreement" or "Loan Agreement" means the within Loan, Mortgage and Security Agreement between :the Issuer and the Borrower as the same may be amended from time to time in accordance with the provisions hereof. "Authorized Borrower Representative" means the person or persons at the time designated to act on behalf of the Borrower, as provided in Section 8.8 hereof, by written certificate furnished to the Issuer and the Trustee, containing the specimen signature or signatures of such person or persons. Such certificate or any subsequent or supplemental certificate so executed may designate an alternate or alternates. The officers of the Borrower executing this Agreement shall each be an Authorized Borrower Representative. "'::e Borrower ma~• a 1 so , f rom t ir,~e to time ar.d in i is SCle QiS,'_'_~tlOn ~ Wlth the a_ :?i :i~.'c J Ur `_~:£' i. u5tee ~ GE''_1'~ ~?r tG, i~T cause to be delivered to, the Trustee a substitute letter of credit or a letter of credit in substitution for prior substitute letters of credit; provided, however, that alI substitute letters of credit and substitutions therefor be approved by the holders of not less than fifty percent of the principal amount of the Bonds then outstanding affected by the Letter of Credit for which the substitute is made. (End of Article IV) _~~_ AFTICLE V Particular Covenants and Representations of the Borrower Section 5.1. Borrower to Maintain its Existence. At all times prior to the Completion Date of the Project and so long as the Borrower shall own the Project, the Borrower covenants and agrees that it will maintain its existence as an Illinois corporation, in full compliance with applicable federal and state laws; and it will not dispose of all or any material part of its assets. The Borrower will maintain its qualification to transact business in this State as contemplated by this Agreement and the Indenture. Section 5.2. Indemnity. The Borrower covenants and agrees, at its expense, to pay, and to indemnify and save the Issuer and the Trustee harmless of, from and against, any and all claims, damages, demands, expenses, liabilities and taxes (of any character or nature whatsoever regardless of by whom imposed), and losses of every conceivable kind, character and nature what- soever (including, but not limited to, claims for loss or damage to any property or injury to or death of any person asserted by or on behalf of any person, firm, corporation or governmental au- thority arising out of, resulting from, or in any way connected with the Project, or the condition, occupancy, use, possession, conduct or management-of,:or any work done in or about, the Proj- ect Real Estate, or-from the planning, design, acquisition, ex- tension or improvement of the Project or any part thereof, or ei- ther, or from the leasing or subletting of any part of either), or any failure on the part of the Borrower to perform or comply with any of the provisions of this Loan, b9ortgage and Security Agreement, unless such claims, damages, demands, expenses, liabilities, taxes and losses arise by reason of the negligent act or omission of the Issuer and/or the Trustee. The Borrower also- covenants and agrees, at its expense, to pay, and to indemnify and save the Issuer and the Trustee harmless of, from and against, all costs, reasonable counsel fees, expenses and liabilities incurred in any action or proceeding brought by reason of any such claim or demand. In the event that any action or proceeding is brought against the Issuer or the Trustee by reason of any such claim or demand, the Borrower upon notice from the Issuer or the Trustee, covenants to resist and defend such action or proceeding on behalf of the Issuer and the Trustee. Section 5.3. Restriction on Conveyance. Except as otherwise pr iov ded in this Section 5.3, the Borrower covenants that it will not convey its fee s5.mple estate in the Project Real Estate. -, -~-- The Borrower r~av convey the Project, as a whole or in . _rt, without the .^.ecessity cf ':,Lt~ining the consent of tr;e issuer or the Trustee, subject, however, to Each of the following conditions: (a) No such conveyance shall be effected without prior written notices to the Issuer and thA Trustee. • (b) No such conveyance shall relieve the Borrower from primary liability for any of its obligations hereunder, and in the event of any such conveyance the Borrower shall continue to remain primarily liable for all payments for the observance and performance of all other agreements hereunder. (c) The grantee in connection with such conveyance shall assume in writing and agree to perform the obligations of the Borrower hereunder to the extent of the conveyance. (d) Conformed copies of contracts, deeds and other documents concerning the conveyance shall be delivered promptly to the Issuer and the Trustee. (e) A written opinion of Bond Counsel delivered to the Trustee that such conveyance will not result in the interest on the Bonds becoming subject to Federal income taxes. (f) A written opinion of-Independent Counsel delivered- - to the Trustee that such conveyance will not impair the effective- ness of any outstanding Letter of Credit. The Borrower shall not otherwise mortgage the Project Real Estate or grant a security interest in the Project Equipment or mortgage, assign or pledge its interest in any lease with respect to the Project Real Estate or the rent payable thereunder unless such mortgage, security interest, assignment or pledge is made expressly subject to the terms of this Loan Agreement and the Indenture. Section ~5.4.. Covenant With Holders of Bonds. The Issuer and the Borrower agree that this Loan Agreement is exe- cuted in part to induce the purchase of the Series 1983 Bonds and accordingly all covenants and agreements on the part of the Issuer and the Borrower as set forth in this Loan Agreement are hereby declared to be for the benefit of the Trustee and the holders from time to time of the Bonds. Section 5.5. Recording and Filin The security in- terests of the Issuer and the Trustee created hereby and herein and in the Indenture shall be perfected as may be necessary by the filing of financing statements which fully comply with the Illinois Uniform Commercial Code - Secured Transactions. The Issuer and the Borrower further agree that upon request of the Trustee, and at the expense of the Borrower, all necessary con- tinuation statements shall be filed within the time prescribed by the Illinois Uniform Commercial Code - Secured Transactions, in order to continue the security interests created hereby and herein and by the Indenture to the end that the respective rights of the Issuer and the Trustee shall be fully preserved as against creditors of, or purchasers for value from, the Issuer or the Bor- rower. An original counterpart of this Agreement and the Inden- ture shall be filed in the office of the Recorder of the County in which the Issuer is located. On or before the first day of December in each calendar year commencing after the Completion Date, and so long as any Bonds are Outstanding under the Indenture, the Borrower will file with the Trustee, if so requested by the Trustee, a certificate describing, as of the first day of the immediately preceding month, each item of tangible personal property owned by the Borrower, not described in a previous similar certificate, which has been added to the Project, whether as a substitution, replacement or addition, and whether or not, when added, it becomes part of the Project. The Borrower will execute all instruments, including financing statements, deemed necessary or advisable in the opin- ion of Independent Counsel (who may be counsel for the Trustee or the Borrower) for perfection of the security interests as afore- said. However, all obligations of the Borrower under this Sec- tion are subject to the condition that the Issuer and the Trustee shall execute all instruments, including financing statements, required of either of them in the opinion of such Independent Coun- sel. The Issuer covenants and agrees to execute all such financ- ing and continuation statements and other instruments deemed neces- sary or advisable by Independent Counsel and to use its best ef- forts to cause the Trustee to execute all such financing and other instruments. The Borrower will file and record all such instru- ments executed by the Issuer, the Trustee or the Borrower, or cause them to be filed and recorded, and shall continue the liens and security interests of all such instruments by appropriate re- filing and re-recording as specified in the opinions of such Independent Counsel, or cause them to be so continued until the Bonds have been fully paid and discharged under the Indenture. Section 5.6. Arbitrage Covenants. The Borrower and the Issuer ccvenant with the holders from time to time of the Bonds that so long as any of the Bonds remain outstanding, moneys on deposit in any fund or account in connection with the Bonds, whether or not such moneys were derived from the proceeds of the sale of the Bonds or from any other sources, will not be used in a manner which will cause the Por,ds to be "arbitrage bonds" with- in the meaning of Section 103(c) of the Code and the Regulations thereunder and that they will take no action and permit no action to be taken which would adversely affect the tax-exempt status of the interest on the Bonds for Federal income tax purposes. The Borrower reserves the right, however, to make any investment of such moneys permitted by this Agreement and the law of the State of Illinois, if, when and to the extent that said Section 103(c) -26- or Regulations prc>mulgated thereunder shall be replaced or relaxed or shall be held void by final judgment of a court of competent jurisdiction, but only if any investment made by virtue of such repeal, relaxation or decision would not, in the written opinion of Bond Counsel, result in making the interest on any series of Bonds subject to Federal income taxation. Section 5.7. Capital Expenditures and Use of Project. The Issuer covenants that it shall, prior to the issuance of the Series 1983 Bonds duly elect to have the provisions of Section 103 (b) (6) (D) of the Code apply to such issue and such election shall be made in accordance with the procedure set forth in Sec- tion 1.103-10 (b)(3)(iv) of the Regulations. The Borrower coven- ants that it shall furnish to the Issuer whatever information is necessary for the Issuer to make such election, and shall file all supplemental statements and other information required by the Regulations and the procedures of the Internal Revenue Service. The Borrower and any lessee of the Project that may be a "principal user" of the Project as defined in Section 103 of the Code (collectively called the "Principal Users") respectively, if they are so required to do by applicable law, will attach a copy of the Issuer's statement of election to their income tax returns for the taxable year during which the election is made, in accord- ance with Section 1.103-10(b)(2)(vi)(a) of.the Regulations. The Borrower understands that the term "capital expendi- tures" as used in this Agreement and in the Indenture, as of the date of execution of this Agreement, means any expenditure made by any person which, under any rule or election under the Code, may be treated as a capital expenditure (whether or not such ex- penditure is so treated) and determined without regard to any rule of the Code which permits expenditures properly chargeable to a capital account to be treated as current expenses, unless such expenditure is an "excluded expenditure" under Section 1.103-10 of the Regulations or Section 103 of the Code. The Borrower further covenants that no Principal User or any person or corporation related to any of them, shall within three (3) years of the date of issuance of the Series 1983 Bonds make or permit to be made any capital expenditure, within the mean- ing of Section 103(b)(6) of the Code, which would bring the total amount of such expenditures for the six (6) year period, beginning three (3) years prior to the date of issuance of the Series 1983 Bonds, above the applicable limitation under Section 103(b)(6)(D) of the Code; nor shall any Principal User take any other action which would result in rendering interest payable under this Agree- ment, the Indenture or on the Series 1983 Bonds subject to Federal income taxation under the provisions of said Section 103(b)(6). The Borrower agrees to file and to cause all other Principal Users to file each year during said period if they are so required to do by applicable law, with the offices of the Internal Revenue Service where the Borrower and such Principal Users respectively, are required to file their Federal income tax returns (1) a copy of the Issuer's statement of election, (2) a supplemental state- -27- ment listing by date and amount any capital expenditures made by the Borrower or the Lessee or other principal user within the boun- daries of the City of Canton, Illinois in the preceding year, and shall furnish a copy of such statement to the Trustee. Bor- rower covenants that it will not lease more than 10$ of the space in the Project, including a prorata part of common areas, to any lessee unless Bond Counsel shall have rendered the opinion that such lease will not adversely affect federal income tax exemptions of interest on the Bonds. The Borrower covenants that (a) the proceeds of the Bonds are to be used primarily with respect to facilities to be located in the City of Canton, Illinois; (b) the Borrower, will be a principal user of the facilities to be acquired and constructed with the proceeds of the Bonds within the meaning of Section 103(b)(6) of the Code; and (c) other than the Series 1983 Bonds, there are no outstanding obligations which are classified as "exempt small. issues" under Section 103(b)(6) of the Code and any Regulations with respect to Section 103 (b) (6) of the Code, issued subsequent to April 30, 1968, of any state, territory or possession of the United States, or any political subdivision of the foregoing or of the District of Columbia, the proceeds of which have been or are to be used primarily with respect to facilities located in the City of Canton, Illinois, or any contiguous or integrated facility treated as being located in the City of Canton, Illinois, by reason of being located on both sides of a border between the City of Canton, Illinois and one or more other political jurisdictions, the principal user of which is any Principal User or any such related person. The Borrower further covenants that it shall furnish to both the Issuer and the Trustee (i) at the time of the issuance of the Series 1983 Bonds, a statement of the aggregate amount of capital expenditures paid or incurred by the Borrower and any oth- er Principal User within the corporate limits of the City of Canton, Illinois ("Included Capital Expenditures"), during the period beginning three (3) years before the date of such issue, (ii) within ninety (90) days following each anniversary of the date of the issuance of the Series 1983 Bonds, a statement of the aggregate amount of Included Capital Expenditures paid or in- curred during the period beginning with the date of issuance or of the last statement filed with the Issuer and the Trustee, whichever is later, and ending on such anniversary date, and (iii) within thirty (30) days after the Borrower or any related person has paid or incurred aggregate capital expenditures of $3,000,000 (not including the proceeds of the Series 1983 Bonds) with respect to the Project or any other property or facilities located in the City of Canton, Illinois, a statement to that effect. Each such statement shall set forth (A) a description of those expenditures which are capital expenditures under Section 103(b)(6)(D)(ii) of the Code, and shall take into account facilities referred to in Section 103(b)(6)(E) of the Code in computing such capital expenditures, and (B) a description, and the reason for the exclusion, of any capital expenditures which -28- the Borrower or other Principal User has made, but has not taken into account under Section 103(b)(6)(F) of the Code. The Borrower hereby covenants that it will not use or occupy the Project or permit the Project to be used or occupied in any manner which would result in the loss of the exemption from Federal income taxes of the Bonds, including by reason of any user or occupancy of the Project prohibited or restricted pursuant to Section 103(b)(6)(0) of the Code. Section 5.8. Warranty Borrower warrants that it has a title to the Project, free from mitted Encumbrances. of Title; Title Insurance. The good and .marketable fee simple all encumbrances other than Per- At the time of the delivery of the Series 1983 Bonds, the Borrower will provide the Trustee an ALTA mortgage title in- surance policy or appropriate binder issued by a title insurance company acceptable to the Trustee and the original purchaser(s) of the Bonds in the face amount of $2,500,000. Said policy or binder will insure the Issuer and the Trustee as mortgagees; will contain the title insurance company's standard pending disbursement clause; and will show the Borrower as fee simple owner of the Project Real Estate and the Building, subject only to Permitted Encumbrances. Any net proceeds payable either to the Trustee or the Borrower under such policy shall, at the Borrower's option, if there is no default hereunder, and at the Trustee's option if there is a default hereunder be either (a) used to acquire and construct replacement or substitute property for that to which title has been lost and such property shall be subjected to the lien of this Loan Agreement, or (b) used to prepay and Notes and to redeem Bonds at the earliest possible date pursuant to the Indenture. Section 5.9. Maintenance and Modification of Project Borrower. The Borrower agrees that during the term of this Loan Agreement it will at its own expense (i) keep the Project in reasonably safe condition and (ii) keep all buildings and all im- provements forming a part of the Project in good repair and in good operating condition, making from time to time all necessary repairs thereto and renewals and replacements thereof. The Bor- rower may, at its own expense, or pursuant to the provisions of Section 5.23 hereof, make from time to time any additions or al- terations to the Project it may deem desirable for its business purposes that do not adversely affect the operation of the Proj- ect. Except as provided in Section 5.23 hereof, such additions and alterations so made by the Borrower shall be on the Project Real Estate and shall become a part of the Project. The Borrower shall not permit any mechanics' or other liens to be established or remain against the Project for labor or materials furnished in connection with any additions, modifications, improvements, re- pairs, renewals or replacements so made by it; provided, the Bor- rower may in good faith contest any mechanics' or other liens -29- filed or established or remaining against the Project for labor or materials furnished in connection with any additions, modifica- tions, improvements, repairs, renewals or replacements so made by it; 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, provided that adequate reserves, in ac- cordance with generally accepted accounting principles, are main- tained for the payment of such liens during the pendency of such contest. and appeal, unless the Trustee shall notify the Borrower that, in the opinion of Independent Counsel, by nonpayment of any such items the lien of this Agreement as to any material part of the Project will be materially and imminently endangered or the Project or any material part thereof will be subject to imminent loss or forfeiture, in which event the Borrower shall promptly pay and cause to be satisfied and discharged all such unpaid items. The Issuer will at the expense of the Borrower cooperate fully with the Borrower in any such contest. Section 5.10. Insurance Required. From commencement of the construction of the Project and throughout the term of this Agreement, the Borrower shall keep the Project or cause the same to be kept continuously insured against such risks as are customarily insured against by businesses of like size and type, paying as the same become due all premiums in respect thereto, including but not necessarily limited to: (a) Insurance upon the repair or replacement basis if available, and otherwise to 100$ of the full insurable value of the Project (with such deductible provisions as are cus- tomarily included in policies of such insurance negotiated with respect to entities of similar size and character) against loss or damage by fire and lightning, with uniform standard extended coverage endorsement limited only as may be provided in the standard form of extended coverage en- dorsement at the time in use in the State, provided that such insurance need not be taken out until the construction of the Building has commenced or materials for such construction or installation have been stored on the Project Real Estate. (b) Boiler explosion insurance on steam boilers, pres- sure vessels and pressure piping in an amount not less than repair or replacement cost (with such deductible provisions as are customarily included in policies of such insurance negotiated with respect to entities of similar size and cha- racter), provided that such insurance need not be taken out until the steam boilers, pressure vessels and pressure pip- ing have been installed in the Project. (c) Insurance to the extent of $500,000 per person and $1,000,000 per occurrence against liability for bodily injury, including death resulting therefrom, and to the extent of Y500,000 per occurrence against liability for damage to prop- erty, including loss of use thereof in connection with the Project. -30- (d) During the Construction Period builders' risk in- surance on a full completed value basis and surety and labor and materials payment bonds to the extent that such insur- ance and bonds are not carried by contractors working on the Project. (e) Use and occupancy insurance or business interrup- tion or rental income insurance, covering loss of revenues by reason of the total or partial suspension of, or interrup- tion in, the operation of the Project caused by damage to or destruction of any part of the Project, with such exceptions as are customarily imposed by insurers, covering a period of suspension or interruption and in such amounts as will pro- vide revenues equal to 100$ of the annual rentals payable by any lessee under any lease during the entire term of the lease of the Project, if any. Section 5.11. A lication of Net Proceeds of Insurance. The Net Procee s of the insurance c- arri d pursuant to the provisions of Sections 5.10(a) and 5.10(b) hereof shall be paid and applied as provided in Section 5.15 hereof; and the Net Proceeds of insurance carried pursuant to the provisions of Sec- tion 5.10(c) hereof shall be applied toward extinguishment or sa- tisfaction of the liability with respect to which such insurance proceeds have been paid. Section 5.12. Additional Provisions Res ectin Insurance. All insurance required in Section 5.10 ereo shall be taken out and maintained in generally recognized responsible insurance companies qualified to do business in the State of Il- linois, selected by the Borrower. All policies evidencing such insurance shall name the Borrower as insured, and the Trustee, the Issuer and the Borrower's successors, or assigns (as appro- priate) as additional insureds as their respective interests may appear, and the policies required by Sections 5.10 (a) , 5.10 (b) , 5.10 (d) and 5.10(e) hereof shall contain standard mortgagee clauses requiring that all Net Proceeds of insurance resulting from any claim in excess of $50,000 for loss or damage covered thereby be paid to the Trustee; provided, however, that all claims regardless of amount may be adjusted by the Borrower or its successors, or assigns (as appropriate) with the insurers, subject to approval of the Trustee as~to any settlement of any claim in excess of $50,000. A certificate or certificates of the insurers that such insurance is in force and effect shall be deposited with the Trustee; and prior to the expiration of any such policy the Borrower shall furnish the Trustee with evidence satisfactory to the Trustee that the policy has been renewed or replaced. In lieu of separate policies, the Borrower may main- tain one or more blanket policies of insurance having the cover- age required by Section 5.10 hereof. -31- Section 5.13. Advances ~ Issuer or Trustee. In the event the Borrower sFiall fail to mainta- in he full in urance cov- erage required by this Agreement or shall fail to keep the Proj- ect in reasonably safe condition, or shall fail to keep the Proj- ect in good repair and good operating condition, the Issuer or the Trustee nay (but shall be under no obligation to) take out the required policies of insurance and pay the premiums on the same or make the required repairs, renewals and replacements; and all amounts so advanced therefor by the Issuer or the Trustee shall become an additional obligation of the Borrower to the one making the advancement, which amounts, together with interest thereon at the maximum rate described in Section 4.2 hereof in connection with overdue principal and interest, from the date thereof, the Borrower agrees to pay on demand. Section 5.14. Workmen's Compensation Coverage. During the Construction Period and throughout the term of the Loan Agree- ment, the Borrower shall maintain or cause to be maintained, in connection with the Project, the Workmen's Compensation coverage required by the laws of the State of Illinois. Section 5.15. Damage and Destruction. In the event the Project or any part thereof shall be destroyed or damaged and the Borrower shall elect to exercise its option to prepay the Se- ries 1983 Note pursuant to the provisions of Section 7.2(a) here- of (in which event the Borrower shall apply the Net Proceeds to the prepayment of the Series 1983 Note and the redemption of the Series 1983 Bonds), the Borrower shall not be required to comply with the provisions of the next succeeding paragraph. Subject to the provisions of the previous paragraph, if prior to full payment of the Series 1983 Bonds (or provision for payment thereof having been made in accordance with the provi- sions of the Indenture) the Project is damaged or destroyed (in whole or in part) by fire or other casualty then the proceeds of all insurance carried pursuant to Sections 5.10(a), 5.10(b) and 5.10 (e) hereof shall be applied as provided below. To the extent that the claim for loss under the insurance policies required to be carried pursuant to Sections 5.10(a), 5.10(b) and 5.10(e) hereof resulting from such damage or destruction is:' (a) not greater than $50,000, the Borrower (i) shall promptly repair, rebuild or restore the Project to substan- tially the same condition thereof as existed prior to the event causing such damage or destruction with such changes, alterations and modifications (including the substitution and addition of other property) as may be desired by the Borrower and as will not impair the value or the character of the Project, and (ii) will apply for such purpose as much as may be necessary of any Net Proceeds of insurance result- ing from such claims for losses. -32- (b) in excess of $50,000, the Borrower shall promptly give written notice thereof to the Trustee. All Net Proceeds of insurance resulting from such claims for losses in excess of $50,000 shall be paid to and held by the Trustee in a separate trust account, whereupon the Borrower shall proceed promptly to repair, rebuild or restore the Project to substantially the same condition thereof as existed prior to the event causing such damage or destruction with such changes, alterations and modifications (including the sub- stitution and addition of other property) as may be desired by the Borrower and as will not impair the value or the cha- racter of the Project, whereupon the Trustee shall apply so much as may be necessary of the Net Proceeds of such insur- ance to payment of the costs of such repair, rebuilding or restoration either on completion thereof or as the work pro- gresses. Any payments made by the Trustee of Net Proceeds held by the Trustee pursuant to the provisions of subsection (b) above shall be made upon receipt by the Trustee of requisitions in sub- stantially the same form as the requisitions described in Section 3.3 hereof, provided, however, that no payments by the Trustee of such Net Proceeds for such purposes shall be made by the Trustee unless and until the Trustee shall have first received: 1. The written certification of an Independent Archi- tect or Independent Engineer as to the total costs to be in- curred in connection with the repair, rebuilding or restora- tion of the Project, as aforesaid, and 2. Evidence satisfactory to the Trustee that suffi- cient funds are available to carry out the repair, rebuild- ing or restoration of the Project, as aforesaid. Any balance of such Net Proceeds remaining after pay- ment of all costs of such repair, rebuilding or restoration shall be applied to the prepayment of the Notes and the redemption of the Bonds. If the Bonds have been fully paid (or provision therefor has been made in accordance with the Indenture), all Net Proceeds shall be paid to the Borrower. Subject to the provisions of the first paragraph of this Section, in the event the Net Proceeds are not sufficient to pay in full the costs of any such repair, rebuilding or restora- tion, the Borrower shall nonetheless complete said work and shall pay that portion of the costs thereof in excess of the amount of said Net Proceeds. The Borrower shall not, by reason of the payment of such excess costs, be entitled to any reimbursement from the Is- st}er or the Trustee of any abatement or diminution of the amounts payable under Section 4.2 hereof. -Ss- Any moneys held by the Trustee under the provisions of this Section, shall, at the written request of the Borrower, be invested or reinvested by the Trustee as specified by the Autho- rized Borrower Representative in such request in investments au- thorized by Section 3.7 hereof. Any earnings or profits on such investments shall be considered as part of the Net Proceeds and the Borrower shall forthwith pay to the Trustee the amount of any losses on such investments. Section 5.16. Condemnation. In the event title to, or temporary use of, all or any part of the Project shall have been taken by the exercise of the power of eminent domain and the Bor- rower shall elect to exercise its option to prepay the Series 1983 Note in whole or in part pursuant to the provisions of Sec- tions 7.2(b) or 7.2(d) hereof (in which event the Borrower shall apply the Net Proceeds to the prepayment of the Series 1983 Note and the redemption of the Series 1983 Bonds), the Borrower shall not be required to comply with the provisions of the next succeed- ing paragraph. Subject to the provisions of the previous paragraph, if prior to the full payment of the Series 1983 Bonds (or provision for payment thereof having been made in accordance with the pro- visions of the Indenture) title to, or the temporary use of, the Project or any part thereof shall be taken by the exercise of the power of eminent domain, the Issuer, the Borrower and the Trustee shall cause the Net Proceeds received by them or any of them from any award made in such eminent domain proceedings, to be paid to and held by the Trustee in a separate trust account, to be applied in one or more of the following ways as shall be directed in writing by the Borrower: (a) To the restoration of the Project to substantially the same condition thereof as existed prior to the exercise of the said power of eminent domain; or (b) To the acquisition of other suitable land and the acquisition, by construction or otherwise, of improvements consisting of a building or buildings, facilities, machinery, equipment or other properties suitable for the Borrower's operations at the Project (which improvements shall be deemed a part of the Project and available for use and occupancy by the Borrower); provided, that such improvements shall be ac- quired by the Borrower subject to the lien of this Agreement and to no other liens or encumbrances other than Permitted Encumbrances. Any payments made by the Trustee of Net Proceeds held by the Trustee pursuant to the provisions of subsections (a) or (b) above shall be made upon receipt by the Trustee of requisi- tions in substantially the same form as the requisitions described in Section 3.3 hereof, provided, however, that no payments by the Trustee of such Net Proceeds for such purposes shall be made by -34- the Trustee unless and until the Trustee shall have first received the certificate and evidence described in Sections 5.15.1 and 5.15.2 hereof. Any balance of the Net Proceeds of the award in such eminent domain proceedings remaining after payment of all costs of such repair, rebuilding or restoration shall be paid into the Bond Fund. If the Bonds have been fully paid (or provision for payment thereof has been made in accordance with the provisions of the Indenture), all Net Proceeds shall be paid to the Borrow- er. ' Subject to the provisions of the first paragraph of this Section, in the event the Net Proceeds are not sufficient to pay in full the costs of any such repair, rebuilding or restora- tion, the Borrower shall nonetheless complete said work and shall pay that portion of the costs thereof in excess of the amount of said Net Proceeds. The Borrower shall not, by reason of the payment of such excess costs, be entitled to any reimbursement from the Is- suer or the Trustee of any abatement or diminution of the amounts payable under Section 4.2 hereof. Any moneys held by the Trustee under the provisions of this Section, shall, at the written request of the Borrower, be invested or reinvested by the Trustee as specified by the Autho- rized Borrower Representative in such request in investments au- thorized by Section 3.7 hereof. Any earnings or profits on such investments shall be considered as part of the Net Proceeds and the Borrower shall forthwith pay to the Trustee the amount of any losses on such investments. Section 5.17. Condemnation of Property not Constituting a Part of the Project. The Borrower shall be entitled to the Net Proceeds of any condemnation award or portion thereof made for damages to or taking of its property not included in the Project. Section 5.18. Issuer's and Trustee's Right of Access to the Pro~ec~-The Borrower agrees that during the term of t~iis Agreement the Issuer and the Trustee and their duly authorized agents or representatives shall have the right at reasonable times to enter upon and examine and inspect the Project, including such rights of access to the Project as may be reasonably necessary (a) for the proper maintenance of the Project in the event of the failure of the Borrower to perform its obligations to maintain the Project in accordance with the terms of this Loan Agreement, (b) to determine that the Borrower has acquired and constructed the Project, and (c) to determine that the Borrower is using the Project or causing the Project to be used for the purposes set forth in Section 2.2(b) hereof. The rights of access hereby re- served to the Issuer and the Trustee may be exercised only after any of their authorized agents or representatives shall have executed release of liability and secrecy agreements in the forms -35- then currently used by the Borrower or its successors or lessees, as appropriate. Nothing contained in this Loan Agreement shall be construed to entitle the Issuer or the Trustee to any informa- tion involving confidential materials of the Borrower or its suc- cessors or lessees, as appropriate. Section 5.19. Release of Certain Land. The parties hereto reserve the right at any time and from time to time to re- lease and remove from the lien of this Agreement (i) any unim- proved part of the Project (on which neither the Building nor the Equipment constituting a portion of the Project is situated and which is not necessary to the operation of the Project, but upon which transportation or utility facilities may be situated) on which the Borrower then proposes to construct, or cause to be constructed, improvements or (ii) any part (or interest in such part) of the Project with respect to which the Borrower proposes to grant an easement or convey fee title to a railroad, public utility or public body in order that railroad, utility services or public services may be provided, that if, at the time any such release is made, any of the Bonds, are Outstanding, there shall be deposited with the Issuer, the Letter of Credit Bank and the Trustee the following: (a) A copy of the said release as executed. (b) A certificate of the Borrower approving such amend- ment and stating that the Borrower is not in default under any of the provisions of this Loan Agreement. (c) A copy of any agreement wherein the Borrower agrees to construct, or cause to be constructed, improvements on the portion of the Project to be released or a copy of the instrument granting the easement or conveying the title to a railroad, public utility or public body. (d) A certificate of an Independent Engineer who is acceptable to the Trustee, dated not more than sixty days prior to the date of the release and stating that, in the opinion of the person signing such certificate, (i) the por- tion of the Project so proposed to be released is necessary or desirable in order to obtain railroad, utility services or public services to benefit the Project or is not other- wise needed for the operation of the Project for the purposes hereinabove stated and (ii) the release so proposed to be made will not impair the usefulness of the Project for the purposes set forth in Section 2.2(b) hereof and not destroy the means of ingress thereto and egress therefrom. (e) An amount equal to the appraised value of the land to be released, which shall be applied to the prepayment of the Notes and the redemption of the Bonds. Any other con- sideration received by the Borrower shall be the property of the Borrower. -36- And, provided further, if such release relates to a part of the Project upon which transportation or utility fa- cilities are located, the Borrower shall retain an easement to use such transportation or utility facilities to the ex- tent necessary for the efficient operation of the Project for the purposes set forth in Section 2.2 (b) hereof. If all of the conditions of this Section are met, the parties hereto shall be authorized to release any such property from the lien of this Loan Agreement. Section 5.20. Granting of Easements. If no event of default un ec3 r tFis Loan Agreement s~ia1T a~ve happened and be con- tinuing, the Borrower may at any time or times grant easements (including party wall agreements) , licenses, rights of way (in- cluding the dedication of public highways) and other rights or privileges in the nature of easements with respect to any proper- ty included in the Project, or the Borrower may release existing easements, licenses, rights of way and other rights or privileges with or without consideration, and the Issuer agrees that it shall execute and deliver and will use its best efforts to cause the Trustee to execute and deliver any instrument necessary or ap- propriate (including the subordination of this Loan Agreement and the Indenture to the lien of such easement) to confirm and grant or release any such easement, license, right of way or other right or privilege upon receipt of: (i) a copy of the instrument of grant or release; (ii) a written application signed by the Bor- rower requesting such instrument; and (iii) a certificate executed by the Borrower stating (1) that such grant or release is not de- trimental to the proper conduct of the business of the Borrower, and (2) that such grant or release will not impair the effective use or interfere with the operation of the Project for the purposes set forth in Section 2.2(b) hereof and will not weaken, diminish or impair the security intended to be given by or under this Loan Agreement. Any money consideration received in connection with the granting of an easement pursuant to this Section shall be applied to the prepayment of the Notes and the redemption of the Bonds, and any other consideration received shall be the property of the Borrower. Section 5.21. Use of Part Walls. If no event of de- fault shall have happened and be continuing under this Loan Agree- ment, the Borrower may, at its own expense, connect or "tie-in" walls (including use of existing walls for the support of future adjacent buildings), and utilities and other facilities located on the Project Real Estate to other facilities erected on real property adjacent to or near the Project Real Estate or partly on such adjacent real property and partly on the Project Real Estate, or in connection with the expansion or improvement of any building on the Project Real Estate, tear down any wall of such building and build an addition to such building (either on the Project or on real property adjacent thereto), if the Borrower: (a) furnishes the Issuer and the Trustee a certificate of an In- dependent Engineer to the effect that such expansion, addition or -37- connection and the "tie-in" of walls, utilities and other facili- ties will not impair the operating unity of the Project; and (b) at its option, either (i) subjects the real property on which such expansion or addition is built to the lien of this Loan Agreement; (ii) deposits in escrow with the Trustee (under a separate agreement containing terms not inconsistent herewith) sufficient moneys to restore the Project to its original condition, if necessary; (iii) deposits with the Trustee a surety bond for the restoration of the Project to its original condition, if necessary; or (iv) takes such action as may be satisfactory to the Issuer and the Trustee assuring that the Project will, if necessary, be restored to its original condition. Section 5.22. Reserved. Section 5.23. Installation of Borrower's Own Machinery and Equipment. The Borrower may have heretofore, and, while it is not in default hereunder, the Borrower may from time to time, in the future, in its sole discretion and at its own expense in- stall machinery and equipment on the Site. All machinery and equipment so installed (except that listed on Exhibit B hereto) by the Borrower shall remain the sole property of the Borrower (or any third party from whom it may be leased or who shall have provided such machinery and equipment under agreement with the Borrower reserving title to such third party) in which neither the Issuer nor the Trustee nor the Bondholders shall have any in- terest and the same shall not be subject to the lien and security interest of this Agreement unless specifically described therein and the same may be removed or modified at any time. In the event such removal causes damage to the Project, the Borrower shall re- store or repair such damage at its sole expense. Section 5.24. Removal of Project Equipment. The Bor- rower shall not be under any obligation to renew, repair or re- place any inadequate, obsolete, worn out, unsuitable, undesirable or unnecessary Project Equipment. If no event of default under this Loan Agreement shall have happened and be continuing, in any instance where the Borrower in its discretion determines that any items constituting the Project Equipment have become inadequate, obsolete, worn out, unsuitable, undesirable or unnecessary, the Borrower may remove such items of Project Equipment from the Pro- ject Site and sell, trade-in, exchange or otherwise dispose of them (as a whole or in part) without any responsibility or account- ability to the Municipality therefor, provided that the Borrower shall either: (1) Substitute (either by direct payment of the cost thereof or by advancing the funds necessary therefor) and install or construct anywhere on the Project Site other machinery, equip- ment or related property having equal or greater utility (but not necessarily having the same function) in the operation of the Pro- ject for the purpose for which it is intended, provided such re- moval and substitution shall not impair the nature of the Project, -38- all of which substituted machinery, equipment or related property shall be free of all liens and encumbrances (other than Permitted Liens) and shall become a part of the Project Equipment; or (2) Not make any such substitution and installation, provided (a) that in the case of the sale of any such Pro- ject Equipment, the Borrower shall pay into the Bond Fund the proceeds from such sale or the scrap value thereof, as the case may be and (b) that in the case of the trade-in of such Pro- ject Equipment for other equipment not to be installed in the Building or on the Project Real Estate, the Borrower shall pay into the Bond Fund the amount of the credit re- ceived by it in such trade-in. The removal from the Project Real Estate of any portion of the Project Equipment pursuant to the provisions of this Section shall not entitle the Borrower to any abatement or diminution of any amounts payable under Section 4.2 hereof. The Borrower shall promptly report to the Trustee each such removal, substitution, sale and other disposition of any items of the Project Equipment having a depreciated value (calculated in accordance with generally accepted accounting practice) aggregat- ing more than $50,000 or certify annually to the Trustee, upon request received from the Trustee, that no such removal, sale, trade-in, substitution, or other disposition has occurred. The Borrower will pay to the Trustee such amounts as are hereby re- quired which shall be paid into the Bond Fund promptly after the sale, trade-in, or other disposition requiring such payment. The Borrower will pay any costs, including counsel's fees, incur- red in subjecting to the lien of the security interest herein and hereby created, any items of machinery or equipment that under the provisions of this Section are to become part of the Project Equipment. The Borrower will not remove or permit the removal of, any of the Project Equipment from the Project Real Estate ex- cept in accordance with the provisions of this Section. Upon compliance with this Section, the Issuer agrees to deliver or cause the Trustee to deliver any releases deemed neces- sary by the Borrower in regard to the removal of such portion of the Project Equipment. (End of Article V) -39- ARTICLE VI Events of Default and Remedies Section 6.1. Events of Default and Remedies. If any of the follo niw g events occur it is hereby defined and declared to be and to constitute an "event of default" under this Agree- ment: (a) Failure by the Borrower to pay or cause to be paid when due the` principal of, premium, if any, or interest on any of the Notes (or any installment thereof) (whether at maturity, pursuant to the prepayment provisions hereof, or otherwise). (b) Failure by the Borrower to observe and perform any covenant, condition or agreement in this Agreement on the part of the Borrower to be observed or performed, other than as referred to in Subsection (a) of this Section, for a pe- riod of 30 days after written notice specifying such failure and requesting that it be remedied, given to the Borrower by the Issuer or the Trustee, unless the Issuer and the Trustee shall agree in writing to an extension of such time prior to its expiration; or in the case of any such default which cannot be cured within such 30-day period, it shall not constitute an event of default if corrective action is instituted by the Borrower within such 30-day period and diligently pursued until the default is corrected. (c) The filing by the Borrower of a voluntary petition in bankruptcy, or failure promptly to lift or bond in a manner satisfactory to the Trustee any execution, garnish- ment or attachment of such consequence as will impair the ability of the Borrower, including the beneficial owner thereof, to carry out its obligations under this Agreement, or adjudication of the Borrower, as a debtor in bankruptcy or if a petition or answer proposing the adjudication of the Borrower as a debtor in bankruptcy shall be filed in any court and such petition or answer shall not be discharged or uenied within 60 days after the filing thereof, or if the Borrower shall admit in writing its inability to pay its or any of their debts generally as they become due, or a receiver, trustee, assignee, liquidator, sequestrator or similar official of the Borrower or of all or any sub- stantial portion of the Project or its property shall be ap- pointed in any proceeding brought against the Borrower and shall not be discharged within 60 days after such appoint- ment or if the Borrower shall apply for consent to or acqui- esce in such appointment, or assignment by the Borrower for the benefit of its creditors, or the entry by the Borrower into any agreement of composition with its creditors, or the approval by a court of competent jurisdiction of a petition applicable to the Borrower in any proceeding for its reorga- nization instituted under the provisions of the general -40- bankruptcy act, as amended, or under any similar act in any domestic or foreign jurisdiction which may now be in effect or hereafter enacted. (d) Any termination of the possessory interest of the Borrower in the Project. (e) A default or other failure to perform in connection with the payments required or the full and complete performance of all of the agreements, undertakings and covenants contained in any guaranty agreement or guaranty and indemnification agreement or contingent purchase agreement or reimbursement agreement or other agreement in connection with which it is specifically provided in such guaranty agreement or in such guaranty and indemnification agreement or contingent purchase agreement or reimbursement agreement or other agreement, with specific reference to this Indenture, that a default or other failure to perform in connection with such guaranty agreement or guaranty and indemnification agreement or contingent purchase agreement or reimbursement agreement or other agreement shall constitute a default hereunder. The foregoing shall include any Letter of Credit or Reimbursement Agreement. (f) Default in the due and punctual payment of any interest on any Bond. (g) Default in the due and punctual payment of the principal of any Bond (or premium thereon, if any), whether at the stated maturity thereof, or upon proceedings for redemption thereof. The foregoing provisions ~f subsection (b) of this Sec- tion are (except as otherwise provided below) subject to the fol- lowing limitations: If by reason of force majeure the Borrower is unable in whole or in part to carry out the agreements of the Borrower on its part herein contained (other than the obligations on the part of the Borrower contained in Article IV and VII and Sections 5.6 and 5.7 hereof, to which the force majeure provisions of this paragraph shall have no application) the Borrower shall not be deemed in default during the continuance of such inability. The term "force majeure" as used herein shall mean, without limit- ation, the following: acts of God, strikes, lockouts or other industrial disturbances; acts of public enemies; orders of any kind of the government of the United States or of the State of Illinois or any of their departments, agencies, or officials, or any civil or military authority; insurrections; riots; epidemics; landslides; lightning; earthquake; fire; hurricanes; storms; floods; washouts; droughts; arrests; restraint of government and people; civil disturbances; explosions; breakage or accident to ,~,achinery, transmission pipes or canals; partial or entire fail- ure of utilities; or any other cause or event not reasonably within the control of the Borrower, it being agreed that the set- tlement of strikes, lockouts and other industrial disturbances -41- shall be entirely within the discretion of the Borrower, and the Borrower shall not be required to make settlement of stri}:es, lock- outs and other industrial disturbances by acceding to the demands of the opposing party or parties when such course is, in the judg- ment of the Borrower, unfavorable to the Borrower. During the occurrence and continuance of any event of default hereunder, the Issuer shall have the following rights and remedies, in addition to any other remedies herein or by law pro- vided, it being expressly understood that all rights and remedies granted the Issuer under this Article shall extend to and be exer- cisable by the Trustee for the benefit of the holders of the Bonds, that all rights and remedies granted the Zssuer under this Article may be exercised by the Issuer only with the prior written consent of the Trustee and that the Trustee shall not be required to ob- tain the prior written consent of the Issuer in order to exercise any of said rights or remedies: I. Acceleration of Maturity; Waiver of Default and kes- cission of Acceleration. The Issuer may, and with respect to an event of default under subsections (f) and (g) of this Section shall immediately, by written notice to the Borrower, declare the principal of the Notes (if not then due and pay- able) to be due and payable immediately, and upon any such declaration the principal of the Notes together with all ac- crued interest shall become and be immediately due and pay- able, anything in the Notes or in this Agreement contained to the contrary notwithstanding. This provision, however, is subject to the condition that if, at any time after the prin- cipal of the Notes shall have been so declared and become due and payable and prior to the date of any sale or lease of any part of the Project pursuant to this Article, all arrears of principal and interest, if any, upon the Nctes and the ex- penses of the Issuer shall be paid by the Borrower, and every other default in the observance or performance of any covenant, condition or agreement in the Notes, in this Agreement con- tained shall be made good, or be secured, to the satisfaction of the Issuer, or provision deemed by the Issuer to be ade- quate shall be made therefor, then and in every such case the Issuer by written notice to the Borrower may waive the event of default by reason of which the principal of the Notes plus accrued interest shall have been so declared and become due acid payable, and may rescind and annul such declaration and its consequences; but no such waiver, rescission or annulment shall extend to or affect any subsequent event of default or impair any right consequent thereon. II. Issuer May Enter and Take Possession, Operate and Apply Income. The Issuer, personally or by its agents or at- torneys, may enter into and upon all or any part of the Proj- ect and each and every part thereof, and may exclude the Bor- rower, its agents and servants wholly therefrom; end having and holding the same, may use, operate, lease, manage and con- trol the Project for any lawful purpose, provided that each -42- such use, operation, lease, management and control of the Proj- ect be permitted by law, and upon every such entry, the Issuer at the expense of the Borrower from time to time, either by purchase, repairs or construction, may maintain and restore the Project whereof it shall become possessed as afore- said, and may insure and reinsure the same as may seem to it to be judicious; and likewise, from time to time at the ex- pense of the Borrower, the Issuer may make all necessary or proper repairs, renewals and replacements and alterations, additions, betterments and improvements thereto and thereon as to it may seem judicious; and the Issuer shall be entitled to collect and receive all earnings, revenues, rents, issues, profits and income of the same and every part thereof. III. P.ight to Bring Suit, Foreclosure, Etc. The Issuer with or without entry, personally or by attorney, may in its discretion proceed to protect and enforce its rights by a suit or suits in equity or at law, whether for dan-ages or for the specific performance of any covenant or agreement con- tained in the Notes or this Agreement, or in aid of the exe- cution of any power herein granted, or for any foreclosure hereunder, provided, however, that all costs incurred by the Issuer under this Article shall be paid to the Issuer by the Borrower on demand. Section 6.2. Foreclosure of Project. Pursuant to the r;~oi~l:gage on and security interest in the Project hereby created, foreclosure shall be in accordance with applicable laws. Section 6.3. Sale a Bar. Any sale or sales pursuant to Section 6.2 hereof shall operate to divest all estate, right, ti- tle, interest, claim or demand whatsoever, whether at law or in equity, of the Borrower, in and to the premises, property, privi- leges and rights so sold, and shall be a perpetual bar both at law and in equity against the Borrower, its successors and assigns, and against any and all persons claiming or who may claim the same, or any part thereof, from, through or under the Borrower, its successors or assigns. Section 6.4. Recei t Sufficient Dischar a for Purchaser. The receipt o the Issuer or of t e court officer con- ducting any such sale for the purchase money paid at any such sale shall be a sufficient discharge therefor to any purchaser of the property, or any part thereof, sold as aforesaid; and no such pur- chaser or his representatives, grantees or assigns, after paying such purchase money and receiving such a receipt, shall be bound to see to the application of such purchase money upon or for the purposes of this Agreement, or shall be answerable in any manner whatsoever for any loss, misapplication or non-application of any such purchase money or any part thereof, nor shall any such pur- chaser be bound to inquire as to the necessity or expediency of any such sale. -43- Section 6.5. Sale to Accelerate Notes. In the event of any sale pursuant to Section 6.2 hereof or in the event of the ac- celeration of the Bonds pursuant to Section 1002 of the Indenture, the principal of and accrued interest on the Notes, if not previ- ously due, immediately thereupon shall become due and payable, any- thing in the Notes or this Agreement tc~ t-hE contrary notwithstand- ing. Section 6.6. Application of Proceeds. All moneys re- ceived by the Issuer or the Trustee pursuant to any right given or action taken under the provisions of this Article shall, after pay- ment of the costs and expenses of the proceedings resulting in the collection of such money and of the expenses, liabilities and ad- vances incurred or made by the Issuer ar the Trustee, be deposited in the Bond Fund and all moneys in the Bond Fund shall be applied as follows: (a) Unless the principal of the Notes shall have become or shall have been declared due and payable, all such moneys shall be applied: FIRST - To the payment of all installments of inter- est then due on the Notes, 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 par- ticular installment, then to the payment ratably, accord- ing to the amount due on such installment, without any discrimination or privilege; and SECOND - To the payment to the unpaid principal of and premium, if any, on any of the Notes which shall have become due (other than Notes or portions thereof for which payment has been made or provided for), in the order of the due dates of the principal installments thereof, with interest on such Notes or portions thereof from the res- pective dates and, if the amount available shall not be sufficient to pay in full principal of, premium, if any, and interest on the dotes due on any particular date, then to the payment ratably, according to the amount of the principal, interest, and premium, if any, due on such date, without any discrimination or privilege. (b) If the principal of all the Notes shall have become due or shall have been declared due a.rd payable, all such moneys shall be applied to the payment of the principal, prem- ium, if any, and interest then due and unpaid upon the Notes, without preference or priority of principal over interest or premium or of interest over principal or premium or premium over principal or interest or of any installment of principal or interest over any other installment of principal or inter- est over any other installment of principal or interest, or of any Note over any other Note, ratably, according to the amounts due respectively for principal, premium, if any, and interest, without any discrimination or privilege. (c) If the principal of all the Notes shall have been decla -44- red due and payable, and if such declaration shall thereafter have been rescinded and annulled under the pro- visions of this Article then, subject to the provisions of paragraph (b) of this Section in the event that the principal of all the Notes shall later become due or be declared 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 pursuant to the pro- vision of this Section, such moneys shall be applied at such times, and from time to -time as the Trustee shall determine, having due regard to the amount of such moneys 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 applica- tion is to be made and upon such date interest on the amounts of principal to be paid on such date shall cease to accrue. Whenever all principal of, premium, if any, and interest on all Bonds have been paid under the provisions of this Section and all expenses and charges of the~Trustee shall have been paid, any balance remaining in the Bond Fund shall be paid to the Borrow- er as provided in Section 510 in the Indenture. Notwithstanding any other provision of this Agreement to the contrary, any payment by the Letter of Credit Bank to the Trustee pursuant to the Reimbursement Agreement and the Letter of Credit shall be applied only to pay the principal of, premium, only in connection with the interest on the Series 1983 Bonds becoming subject to Federal income taxation, and interest on the Series 1983 Bonds, and not otherwise. Section 6.7. Appointment of Receiver. The Borrower further covenants t~Fiat upon the happening of any event of default and thereafter during the continuance of such event of default un- less the same shall have been waived as hereinbefore provided, the Issuer shall be entitled as a matter of right if it shall so elect, (i) forthwith and without declaring the principal of the Notes to be due and payable, or (ii) after declaring the same to be due and payable, or (iii) upon the filing of a bill in equity to foreclose this Agreement or to enforce the specific performance hereof or in aid thereof or upon the commencement of any other judicial proceed- ing to enforce any right of the Issuer, to the appointment of a receiver or receivers of the Project and of all the earnings, rev- enues, rents, issues, profits and income thereof, with such powers as the court making such appointment shall confer, which may com- prise any or all of the powers which the Issuer is authorized to exercise by the provisions of subdivision II of Section 6.1 here- of. The Borrower, if requested so to do by the Issuer will con- sent to the appointment of any such receiver as aforesaid. -45- Section 6.8. Remedies Cumulative. No remedy herein conferred upon or reserved to the Issuer is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute. Section 6.9. Dela or Omission Not a Waiver. No delay or omission of the Issuer to exercise any right or power accruing upon any event of default shall in-pair any such right or power, or shall be construed to be a waiver of any such event of default or an acquiescence therein; and every power and remedy given by this Agreement to the Issuer may be exercised from time to time and as often as may be deemed expedient by the Issuer., Section 6.10. Waiver of Extension, Appraisement, Stay, Laws. To the extent permitit ed by law, the Borrower will not cur- ing the continuance of any event of default hereunder insist upon, or plead, or in any manner whatever claim or take any benefit or advantage of, any stay or extension of any law wherever enacted, now or at any time hereafter in force, which may affect the cove- nants and terms of performance of this Agreement; nor claim, take or insist upon any benefit or advantage of any law now or hereaf- ter in force providing for the valuation or appraisement of the Froject, or any part thereof, prior to any sale or sales thereof which may be made pursuant to any provision herein contained, or pursuant to the decree, judgment or order of any court of compe- tent jurisdiction; nor after any such sale or sales, claim or ex- ercise any right under any statute heretofore or hereafter enacted by the United States of America or by any state or territory; or otherwise, redeem the property so sold or any part thereof; and the Borrower hereby expressly waives all benefits or advantage of any such law or laws and covenants not to hinder, delay or impede the execution of any power herein granted or delegated to the Is- suer or the Trustee, but to suffer and permit the execution of ev- ery power as though no such law or laws had been made or enacted. Section 6.11. Remedies Subject to Provisions of Law. All rights, remedies and powers provided by this Article may be exercised only to the extent that the exercise thereof does not violate any applicable provision of law in the premises and all the provisions of this Article are intended to be subject to all applicable mandatory provisions of law which may be controlling in the premises and to be limited to the extent necessary so that they will not render this Agreement invalid or unenforceable under the provisions of any applicable law. (End of Article VI) -46- ARTICLE VII Prepayment Section 7.1. Optional Prepayment. Subject to the provisions of Section 4.'l(z) hereof and Section 202 of the Indenture, and as long as no event of default hereunder is existing or continuing, the Borrower shall have the option to prepay the Note in whole or in part on any in- stallment payment date in inverse order of installments. To exercise such option of prepayment, Borrower shall give written notice to the Issuer and the Trustee not less than 60 days prior to the installment payment date which the Borrower shall designate as the redemption date and shall make arrangements with the Trustee for the redemption of the Series 1983 Bonds pursuant to Section 305 of the Indenture. Borrower shall prepay the Note in whole or in part (as the case may be) not less than. two business days prior to the date fixed for the redemption of the Series 1983 Bonds (in whole or in part, as the case may be), and the payment required of the Borrower shall be the sum of the following: (1) An amount of money to be paid into the Bond Fund which, when added to the amount then on deposit in the Bond Fund and not otherwise required to be applied to the payment of current principal and interest, will be sufficient to re- tire and redeem the then outstanding entire principal amount of the Series 1983 Bonds or the portion of the then outstand- ing principal amount of the Series 1983 Bonds to be retired and redeemed (as the case may be) on the Bond redemption date fixed pursuant to Section 305 of the Indenture, including without limitation: 100$ of the principal amount of the Se- ries 1983 Bonds (or portion thereof, as the case may be) to be so redeemed; all interest accrued and to accrue to the date of redemption on the whole or portion of the Series 1983 Bonds to be so redeemed; redemption premium (expressed as per- centages of principal amount) set forth in Section 305 with respect to the Series 1983 Bonds, or part thereof, in connection with which the Series 1983 Note was issued, and all expenses incurred or to be incurred in connection with the prepayment of the Note and the redemption of the Se- ries 1983 Bonds (whether in whole or in part, as the case may he) ; plus (2) An amount of money equal to the Trustee's and pay- ing agent's fees and expenses under the Indenture accrued and to accrue until such payment and redemption of the Series 1983 Bonds (whether in whole or in part, as the case may be), including all expenses of redemption; plus (3) An amount of money sufficient to discharge all oth- er liabilities of the Borrower accrued under this Loan Agree- ment, if the then entire outstanding principal amount of the Series 1983 Bonds shall be retired and redeemed in full. -47- If the Series 1983 Note shall be prepaid in full in accordance with this Section 7.1, the Series 1983 Note shall be cancelled and returned to the Borrower. If the Series 1983 Note shall be prepaid in part in accordance with this Section 7.1, the Series 1983 Note shall be endorsed to show the amount of such principal payment and the amount of the new principal and interest installments required to be paid by the Borrower so as to pay the Series 1983 Note in full not later than September 1, 1993. Section 7.2. Extraordinary Prepayment In Certain Events. Subject to the pro iv sions of Section 4.2(z) hereof, the Borrower shall have, and is hereby granted, the option to prepay the Series 1983 Note at any time in whole but not in part, if any of the following events shall have occurred: (a) The Fraject shall have been damaged or destroyed by fire or other casualty to such an extent that, (i) in the opinion of an Independent Engineer or an Independent Archi- tect expressed in a certificate filed with the Issuer and the Trustee, it cannot be reasonably restored within a period of six (6) consecutive months to the condition thereof immediate- ly preceding such damage or destruction, (ii) in the opinion of an Independent Engineer or an Independent Architect expres- sed in a certificate filed with the Issuer and the Trustee, the Borrower, its successors, lessees or assigns is thereby prevented from carrying on its normal operations for a period of six (6) consecutive months, or (iii) the cost of reconstruc- tion would exceed the total amount of Net Proceeds of insurance carried thereon pursuant to the requirements of Sections 5.10(a) and 5.10 (b) hereof by more than $500,000. Any prepay- ment under this Subsection (a) may be made with proceeds of the "loss of rents" coverage required by Section 5.10 (e) here- of. (b) Title to, or the temporary use of, all or a sub- stantial portion of the Project shall have been taken under the exercise of the power of eminent domain (or by conveyance in lieu thereof) by any governmental authority or person, firm or corporation acting under governmental authority which results, in the opinion of an Independent Engineer or an Independent Architect expressed in a certificate filed with the Issuer and the Trustee, in the Borrower, its successors, lessees or assigns being thereby prevented from carrying on their normal operations therein for a period of six (6) consecutive months. (c) As a result of any changes in the Constitution of the State or the Constitution of the United States of Ameri- ca, of any legislative or administrative action (whether state or federal), or by any final decree, judgment or order of any court or administrative body (whether state or feder- al) entered after the contest thereof by the Borro~:er in good faith, this Agreement shall have become void or unenforceable or impossible of performance in accordance with the intent -48- and purposes of the parties as expressed in this Agreement, or unreasonable burdens or excessive liabilities shall have been imposed on the Issuer or the Borrower, including, without limitation, federal, state, ad valorem, property, income or other taxes not being imposed on the date of this Agreement. The Borrower shall also have, and is hereby granted, the option to prepay the Series 1983 Note at any time in part, if the following event shall have occurred: (d) Title to or the temporary use of, less than a sub- stantial portion of the Project shall have been taken under the exercise of the power of eminent domain (or by conveyai~re in lieu thereof) by any governmental authority or person, firm or corporation acting under governmental authority, but only if the Borrower shall furnish to both the Issuer and the Trustee a certificate of an Independent Engineer or an Inde- pendent Architect stating (i) that the property forming a part of the Project that was taken in such condemnation pro- ceedings is not essential to the use or occupancy of the Proj- ect by the Borrower, its successors, lessees or assigns, (ii) that the Project has been restored to a condition substantially equivalent to its condition prior to the taking by such condemnation proceeding, or (iii) that improvements have been acquired which are suitable for the Borrower's operations at the Project as contemplated by Section 5.16(a) or Section 5.16 (b) hereof. Any partial prepayment of the Series 1983 Note pursuant to the provisions of this Section 7.2 (d) shall be in inverse order of the principal install- ments thereof. Such option shall be exercisable in the manner provided in Section 7.4 hereof, except that, in addition to the require- ments of said Section, the Borrower shall also deliver to the Issu- er and the Trustee, not later than 120 days subsequent to the date of the event which gave rise to the right of the Borrower to pre- pay the Series 1983 Note pursuant to this Section 7.2, a notice signed by the Borrower specifying the event which gave rise to the right of the Borrower to prepay the Series 1983 Note under this Section and the date upon which said event occurred. The amount payable by the Borrower in the event of its exercise of the option granted in this Section shall be the sum of the following: (1) An amount which will be sufficient to redeem all Series 1983 Bonds then Outstanding (in the event of prepay- ment of the Series 1983 Note in whole pursuant to Sections 7.2(a), 7.2(b), 7.2(c) or 7.2(d) hereof) or the Series 1983 Bonds to be redeemed (in the event of prepayment of the Se- ries 1983 Note in part pursuant to Section 7.2(e) hereof) at a redemption price of 100$ of the principal amount thereof plus accrued interest to the redemption date and without pre- mium, and -49- (2) An amount sufficient to pay the expenses incurred or to be incurred by the Issuer and the Trustee in connection with the prepayment of the Series 1983 Note and the redemp- tion of the Series 1983 Bonds in whole or in part, as the case may be, and if all Series 1983 Bonds then outstanding are to be redeemed, an amount sufficient to discharge all other liabilities of the Borrower under this Agreement. Section 7.3. Mandatory Prepayment. The Notes shall also be subject to mandatory prepayment prior to maturity in whole at a prepayment price equal to the principal amount being prepaid plus accrued interest to the prepayment date in the event that the inter- est on the Bonds (whether outstanding or matured) becomes subject to Federal income taxes, other than for the reason of the application of Section 103 (b) (13 ) of the Code, plus, if the loss of the tax exemption is a result of a failure by the Borrower to observe any covenant, agreement, representation or warranty in this Loan Agreement, a premium equal to three months of interest borne by such Bonds. Section 7.4. Manner of Pre a ment. To prepay the Se- ries 1983 No-t n accor a~nce -with t is Article VII and Section 4.2(z) hereof, the Borrower shall give written notice to the Issuer and the Trustee. Such notice shall direct the Trustee to give notice of the redemption of the Series 1983 Bonds to be redeemed and shall specify the prepayment date of the Series 1983 Note (or portion thereof to be prepaid, as the case may be) which prepayment date shall be the same date as the redemption date for the Series 1983 Bonds to be redeemed. Such notice of prepayment shall be given not less than 45 days prior to the prepayment date specified in the notice of prepayment. If the Series 1983 Note shall be prepaid in part as aforesaid, the Series 1983 Note shall be endorsed to show the amount of such principal payment, the principal amount remaining outstanding, and the r,ew annual principal and new semiannual in- terest payments required to be paid by the Borrawer, which pay- ments will be sufficient to pay the annual principal and semian- nual interest payments on the Series 1983 Bonds remaining Out- standing. Section 7.5. Redem tion of Bonds with P~rePaYment Moseys. By virtue of t e assignment ~tT~e it ghts o~ a Issuer under this Loan Agreement to the Trustee as provided in Section 4.4 hereof, the Borrower shall pay any amount required to be paid by it under this Article VII directly to the Trustee. The Trustee shall use the moneys so paid to it by the Borrower to redeem the Series 1983 Bonds in whole or in part, as the case may be, on the redemption date. If on the redemption date any portion of the Se- ries 1983 Bonds to be redeemed shall then be unpaid or provision for payment thereof shall not have been made in accordance with the provisions of the Indenture, the Borrower shall pay to the Trustee such additional moneys as shall be required to pay or re- deem Series 1983 Bonds or portions thereof to be redeemed in ac- cordance with the provisions of the Indenture. -50- The Issuer, at the request at any time of the Borrower and if the same are then callable, shall forthwith take all steps that may be necessary under the applicable redemption provisions of the Indenture to effect redemption of the Series 1983 Bonds in whole or in part, as the case may be, on the earliest redemption date on which such redemption may be made under such applicable provisions. (End of Article VII) -51- ARTICLE VIII Miscellaneous Section 8.1. Notices. All notices, certificates or other commun- is t ons shall be sufficiently given and shall be deemed to have been given on the second day following the day on which the same have been mailed by registered or certified mail, postage prepaid, or given when dispatched by telegram when tele- graphic notice is' permitted by express provisions of this Loan Agreement, addressed as follows: If to the Issuer: City of Canton, Illinois 210 East Chestnut Street Canton, Illinois 61520 Attention: Mayor If to the Borrower: TEMCO America 12111 W. 22nd St., Suite 209 Oak Brook, IL 60521 If to the Trustee: If to the Issuer of any Letter of Credit: -52- Any communication by telegram shall also be addressed as set forth above. A duplicate copy of each notice, certificate ~r other com- munication given hereunder by any of the above parties shall also be given to each of the other above parties. Each of the above may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Section 8.2. Assignments. This Loan Agreement may not be assigned b eiy they the Issuer or the Borrower, except that the Issuer shall and does hereby assign to the Trustee its rights under this Agreement as provided by Section 4.4 hereof, the Borrower may assign its rights hereunder except as otherwise restricted under Section 5.3 hereof and the Trustee shall assign its rights under this Agreement to any successor trustee under the Indenture. Section 8.3. Severability. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. Section 8.4. Execution of Counterparts. 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. Section 8.5. Amounts Remaining in Bond Fund. It is hereby agreed by the Borrower and the Issuer that after payment in full of (i) the Bonds (or provision for payment thereof having been made in accordance with the provisions of the Indenture), (ii) the fees, charges and expenses of the Trustee and paying agents in ac- cordance with the Indenture, and (iii) all other amounts required to be paid under this Loan Agreement, the Notes and the Indenture, any amounts remaining in the Bond Fund shall belong to and be paid to the Borrower by the Trustee. Section 8.6. Amendments, Changes and Modifications. Subsequent to the initial issuance of the Bonds and prior to their payment in full (or provision for payment thereof having been made in accordance with the provisions of the Bond Ordinance), this Agree- ment may be effectively amended, changed, modified, altered or term- inated only as provided in Article XIII of the Indenture, and, in each instance, with the prior written consent of the Trustee. Section 8.7. Governing Law. governed exclusively by and construed plicable laws of the State of Illinois. This Agreement shall be in accordance with the ap- -53- Section 8.8. Authorized Issuer and Borrower Representatives. Whenever under the provisions of th s Agreement or other documents the approval of the Issuer or the Borrower is required, or the Issuer or the Borrower is required to take some action at the request of any of the other, such approval or such request shall be given for the Issuer by an Authorized Issuer Representative and for the Borrower by an Authorized Borrower Representative, and the Trustee shall be authorized to act on any such approval or request and no party hereto shall have any complaint against the other or against the Trustee as a result of any such action taken. Section 8.9. Term of the Agreement. This Agreement shall b~ in full force and effect from the date hereof and shall continue in effect so long as any Bonds are outstanding under the Indenture. (End of Article VIII) -54- r IN WITNESS WHEREOF, the Issuer has caused thi:+ 11arE:e- ment to be executed by its Mayor in its corporate name and its corporate seal to be hereunto affixed and attested by its City Clerk and the Borrower has caused this Agreement to be executed by its duly authorized officers, all as of the date first above written. CITY OF CANTON, ILLINOIS BY Mayor (SEAL) ATTEST: By --- City Clerk TRANSPORTATION EQUIPMENT D:ARKETING COMPAiJY OF AidERICA, an Illinois corporation By Its President (SEAL) ATTEST: By _ Its _ Secretary -55- .~ STI~TE OF ILLINOIS ) SS. COUNTY OF ) The foregoing instrument was acknowledged before me this day of December, 1983, by Donald E. Edwards and Nancy Whites who are, respectively, Mayor and City Clerk of the City of Canton, Illinois, an Illinois municipal corporation, on behalf of said municipal corporat3c~r~. GIVEN under my hand and notarial seal this day of 1983. Notary Public (SEAL) My commission expires: -56- STATE OF ILLINOIS ) SS. COUNTY OF ) On the day of , 1983, before me, a Notary Public in and for said County, personally appeared _ and to me personally known and known to me to be the same persons who executed the within instrument; who, being by me duly sworn did depose, acknowl- edge and say: that they are, respectively, President and Secretary of Transportation Equipment Marketing Company of America, an Illinois corporation, the Borrower described in and which executed the foregoing instrument; that they know the seal of said Borrower; that said instrument was signed and sealed by them as such officers of and on behalf of said Borrower, and the said Borrower acknowledged the execution of said instrument to be the free and voluntary act and deed of said Borrower by it freely and voluntarily executed. Notary Public My commission expires: -57- EXHIBIT A Description of Project Real Estate -58- EXHIBIT B Description of Project Equipment All items of machinery, fixtures, equipment and related property, of every kind and nature whatsoever, installed or located or to be installed or located in or near the Building and on or near the Project Real Estate, purchased with the proceeds of the Bonds, including .but not limited to the following: -59- ~ ~ , L EXHIBIT C SERIES 1983 NOTE 1983 TRANSPORTATION EQUIPMENT MARKETING COI~iPA?JY OF AMERICA, an Illinois corporation (the "Borrower"), hereby promises to pay to the City of Canton, Illinois, a municipal corporation and unit of local government under the 1970 Illinois Constitution (the "Issuer"), the principal sum of DOLLARS ($ ) in annual installments of principal-payable in such amounts and on or before the ]ast business day preceding such dates as follows: Annual December 1 of Installment the year of Principal 1985 $ 1986 $ 1987 $ 1988 $ 1989 $ 1990 $ 1991 $ 1992 $ 1993 $ 1994 $ 1995 $ 1996 $ 1997 $ 1998 $ 1999 $ 2000 $ 2001 $ 2002 $ 2003 $ and to pay interest at such rate or rates with respect to such principal amount outstanding from time to time as set forth above, payable on or before the last business day preceding each _ beginning as follows: -60- s . ~ '. ~ ~ Subject to the provisions of Article IV and Article VII of the Loan Agreement (hereinafter described) with respect to prepay- ment, the principal of and interest on this Series 1983 Note shall be payable by the Borrower on or before the dates and in the amounts above set forth, until payment of such principal, in- terest and applicable premium, if any, shall have been made or provided for, in accordance with the provisions of that certain Loan, Mortgage and Security Agreement dated as of September 1, 1983 (the "Loan Agreement"), by and between the Issuer and the Borrower. This Series 1983 Note shall bear interest at the rate or rates per annum set forth above, and, to the extent authorized by law, on any overdue principal or interest at the rate per annum equal to the greater of the highest rate borne by any installment of this Series 1983 Note or one percent (1$) plus the prime interest rate as defined, established and announced from time to time by Continential Illinois National Bank and Trust Company of Chicago, Chicago, Illinois, which rate may change from day to day, on any overdue principal, interest or premium. This Series 1983 Note constitutes the Series 1983 Note described in the Loan Agreement and is given by the Borrower to evidence and secure the loan to the Borrower made under and pur- suant to the Loan Agreement. This Series 1983 Note is subject to prepayment at the times, in the manner and in the amounts set forth in Article VII of the Loan Agreement. An event of default under the Loan Agreement shall constitute an event of default hereunder, and the Issuer or the Trustee may exercise all rights and remedies set forth in the Loan Agreement upon the occurrence of an event of default, including, without limiting the general- ity of the foregoing, the declaration of the principal hereof and accrued interest to be immediately due and payable. All payments of principal of, premium, if any, and interest on this Series 1983 Note shall be made directly by the Borrower for the account of the Issuer to the Trustee, or its successors and assigns, under a Trust Indenture dated as of December 1, 1983 (the "Indenture"), pursuant to which the Issuer has issued up to $2,500,000 principal amount Economic Development Revenue Bonds, Series 1983 (Transportation Equipment marketing Company of America Project) (the "Series 1983 Bonds"). Payments or prepayments of principal of, premium, if any, and interest on this Series 1983 Note shall be applied to the payment of the principal of, premium, if any, and interest on the Series 1983 Bonds in accordance with the provisions of the Loan Agreement and the Indenture. The terms and provisions of this Series 1983 Note are subject in all respects to the provisions of the Loan Agreement. All of the provisions of the Loan Agreement are hereby incorpor- ated herein by this reference thereto. Ltndefined terms used here- in shall have the meanings given them in the Loan Agreement. In accordance with the provisions of the Loan Agreement and the In- d~nture, the Issuer shall assign to the Trustee all of the Is- suer's right, title and interest in, under and to this Series -61- .. ... ~, • 1983 Note as security for the Series 1983 Bonds. This Series 1983 Note is not transferable by the Trustee except to effect as- signment to any successor trustee under the Indenture. The Borrower waives presentment for payment, demand, notice of protest and notice of dishonor. This Series 1983 Note shall be governed by and con- strued in accordance with the laws of the State of Illinois. IN WITNESS WIiF'REOF, the Borrower has caused this Series 1983 Note to be executed and delivered as of , 1983. TRANSPORTATION EQUIPMENT MARKETING COMPANY OF AMERICA, an Illinois corporation By Its President ATTEST: By s Secretary -62- s i'' ~.. ASSIGNMENT For value received, without recourse, the City of Canton, Illinois hereby assigns all its right, title and interest in, under and to the above Series 1983 Note to as Trustee under the above described Trust Indenture in conn-- e t on with the $ principal amount Economic Development Revenue Bonds, Series 1983 (Transportation Equipment Marketing Company of America Project) dated , 198 Dated as of 198 CITY OF CANTON, ILLINOIS By Mayor ACCEPTANCE as Trustee, hereby accepts the foregoing Assignment by the City of of Canton, Illinois of the $ Series 1983 Note in connection with the Issuer's $ Economic Development Revenue Bonds, Series 1983 (Transportation Equipment Marketing Company of America Project) dated , 198 Dated as of , 198 as Trustee By Its Trust Officer -63- ~,. " ~~ .~, ~ PREPAYMENTS Pursuant to Section 7.2 of the Loan Agreement described above, this Series 1983 Note has been prepaid in part on the date(s) and in the principal amount(s) shown below: Principal Amount . Principal Amount Remaining Date Prepaid Outstandi__nq__ -Signature of Trustee $ $ -64-