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HRA RES 1983-14 - 00013978� � Y� RESOLUTION NO. HRA 14-83 BASIC RESOLUTION AND INDENTURE GENERAL REVENUE DEVELOPMENT BONDS OF THE HOUSING AND REDEVELOPMENT AUTHORITY IN r'1ND FOR THE CITY OF FRIDLEY, MINNESOTA ADOPTED ON �ULY 21ST, This instrument was drafted by , 1983 0'CONNOR & HANNAN 3800 IDS Tower MinneaPOlis. Minnes�ta 55402 � � � �r.—. T�BLE OF CONTENTS (This Table of Contents is not part of this Basic Resolution and Indenture and is for convenience of reference only.) Paqe ARTICLE I- DEFINITIONS AND LEGAL AUTHORIZATION Section 101. Definitions ...........................1-1 Section 1�2. Legal Authorization ..................1-12 ARTICLE II - GENERAL REVENUE BONDS Section 201. General Authorization to Issue General Revenue Bonds .................2-1 Section 202. Issuance of General Revenue Bonds.....2-1 Section 203. Obligations Not Secured By the Basic Resolution ......................2-3 ARTICLE III - GENERAL COVENANTS Section 301. Payment of Principal or Redemption Price and Interest ....................3-1 Section 302. Net Revenues Derived From Contracting Party .....................3-1 Section 303. Net Revenues From Operations..........3-2 Section 304. Pledge of Available Revenues..........3-2 Section 305. Books and Records .....................3-3 Section 306. List of Holders .......................3-3 Section 307. Nature of Security ....................3-4 Section 308. Enforcement of Covenants ..............3-4 Section 309. Production of Adequate Revenues.......3-5 Section 310. Authority Staff Support ...............3-5 Section 311. Construction Funds; Facilities Financed by General Revenue Bozds.....3-5 Section 312. Enforcement of General Revenue Bond Covenants. ...........................3-8 Section 313. Operation of Facilities ..............3-10 Section 314. Insurance ................ ...........3-10 Section 315. Performance by Authority of Covenants............................3-10 ARTICLE IV - FUNDS Section 401. Section 402. Section 403. Section 404. Section 405. Section 406. Section 407. AND ACCOUNTS Funds Pledged and Assigned............4-1 Common Bond Fund ......................4-1 Withdrawals ...........................4-4 Transfers of Funds and Accounting Procedures............................4-8 ConstructionFund ... .................4-9 Deposit of Funds with Trustee and Paying Agent and Paying Ayent Fees....4--9 Priority of Payment ..................4-10 i � � � ARTICLE V - IN�TESTMENTS Section 501. Tnvestments by Authority ..............5-1 Section 502. Return on Investments .................5-1 ARTICLE VI Section Section Section Section Section Section ARTICLE VII Section Section Section - DISCHARGE OF OBLIGATIONS TO HOLDERS 601. Payment of General Revenue Bonds......6-1 602. Prepayment of General Revenue Bonds. ...... ........................6-1 603. Deposit for Discharge .................6-2 604. Use of Deposited Funds ................6-2 605. Unclaimed Moneys ......................6-2 606. Cancellation of Surrendered General Revenue Bonds and Coupons.....6-3 - THE 701. 702. 703. Section 704. Section 705. Section 706. Section 707. Section 708. Section 709. Section 71D. Section 711. ARTICLE VIII Section Section Section Section Section TRUSTEE AND THE PAYING AGENT Trustee...............................7-1 Paying Agents .........................7-2 Responsibilities of Trust�e and Paying Agent ..........................7-2 Funds Held in Trust ...................7-3 Evidence on Which Trustee and Paying Agent May Act ..................7-3 Certain Permitted Acts ....... ........7-4 Resignation of Trustee or Paying Agent.................................7-5 Removal...............................7-5 Appointment of Successor Trustee......7-6 Transfer of Rights to Successor.......7-7 Merger or Consolidation ...............7-7 - AMENDMENT OF BASIC RESOLUTION 801. Amendments Not Requiring Consent......8-1 802. Amendments with Holders' Consent......8-1 803. Proof of Consent ......................8-1 804. Notice of Amendment� ..................8-2 805. Amendment of Supplemental Bond Resolution...........e ................8-3 ARTICLE IX - MISCELLANEOUS Section 901. Severability ..........................9-1 Section 902. Limitation of Liability ...............9-1 Section 903. Table of Contents and Headings........9-1 Section 904. Minnesota Law to Govern ...............9-1 Section 905. Basic Resolution tc Govern............9-1 ii � BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority in and for the City of Fridley, Anoka County, Minnesota, as follows: ARTICLE I DEFINITIONS AND LEGAL AUTHORIZATION Section 101. Definitions. The following terms used herein, unless the context hereof shall require otherwise, shall have the following meanings: "Accumulated Revenues" at any time means all Available Revenues, including earnings thereon, then retained in the Common Bond Eund and any amounts, ancluding earnings thereon, then credited to and retained in the IDB Account; "Act" means Minnesota Statutes, Chapters 474, 462, 462C and any other power or authority of the Authority, as the same may now exist or be from time to time amended or sup- plemented; � "Additional General Revenue Bonds" means General Revenue Bonds issued pursuant to Section 202 hereof in accordance with Section 311(d) hereof and a Supplemental Bond ltesolu- tion authorizing the issuance of Additional General Revenue Bonds to pay the cost of completion of a Facility; � "Administrative Eee" means the fees to be paid by a Con-� tracting Party to the Authority at the times and in the amounts specified in the applicable Revenue Agreement and designated therein as Administrative Fees; "Administrative Fee Account" means the account by that name in the Common Bond Fund created and established by Section 402 hereof; "Approved Letter o£ Credit" means in respect of a series of General Revenue Bonds a letter of credit delivered pursu- ant to Section 402 (d) hereof to the Trustee at or prior to the applicable Bond Closing for compliance with the Minimum Deposit requirement of Section 202 hereof, which letter of credit may be drawn upon by the Trustee to obtain funds (a) promptly in accordance with the applicable 3upplemental Bond Resolution or Revenue Agreement upon the occurrence of any failure to pay any Net Revenues when due under the appli- cable Revenue Agreement, (b) during a period of at least one (1) year following the Bond Closing at any time that the Reserve Deposit in respect of such series may be withdrawn from the Common Reserve Account pursuai�t to Section 1 - 1 � 403(c)(ii) hereof and the applicable Supplemental Bond Reso- lution; and (c) within forty-five (45) days prior to the expiration of such letter of credit ("Expiring Letter") at any time, provided that General Revenue Bonds of such series are then Outstanding (and not scheduled to finally mature on or priot to such expitation), and provided there has not been delivered to the Trustee prior to such time cash sums for deposit in the applicable Reserve Deposit subaccount in the Common Reserve Account, Subsequent Approved Letters of Cxedit or any comhination of such sums and such Subsequent Approved Letters of Credit, whereby any such sums, together with any amounts drawable under such Subsequent Approved Letters of Credit for at least one (1) continuous year im- mediately following such expiration, e�ual the maximum amount drawable under such Expiring Letter; an Approved Letter of Credit shall be Ln form and substance and issued by a financial institution satisfactory to the Authority in its sole discretion; "Articles and Sections," mentioned by number only, means the respective Articles and Sections of this Basic Resolu- tion so numbered; "Authority" means the Housing and Redevelopment Author- � ity in and for the City of Fridley, Minnesota, organized and existing under the Minnesota Housing and Redevelopment Act, Minnesota Statutes, Sections 462.411 et s�ec,; "AUthorized Newspaper" means newspapers or other pub- lications carrying financial news, printed generally at least once a week in the English language and of general circulation in the City of Minneapolis, County of Hennepin, State of Minnesota or the City of Saint Paul, Ramsey County, Minnesota. "Available Revenues" means at the time of determination: (a) all Net Revenues theretofore retained in the Common Bond Fund, (b) all other amounts (includinq Reserve Deposits) then held pursuant to the in the Common Bond Fund, but excluding (i) ings and (ii) Restricted Funds, and received and earninqs and terms hereof Exempt Earn- (c) sach other amounts as the Authority may from time to time designate; "Available Surplus" � year the amount bj which December 31 of such year Debt Service Deficiency, means in respect of any calendar Available Revenues retair.ed as of are greater than (i) the Projected if any, for the next following 1 - 2 � calendar year and (ii) the Common Reserve Requirement as of such December 31; "Basic Resolution" means this Basic Resolution and In- denture and any amendments or supplements hereto permitted hereby; "Board" means the Board of Commissioners, the governing body, of the Authority; "Bond Closinq" means the respective dates on which there is delivery and payment for each series of General Revenue Bonds; "Bond Counsel" means the law firm of O'Connor & Hannan, Minneapolis, Minnesota, or any other firm of nationally recognized 6ond counsel selected by the Authority; "BOrrower" means a Person, other than Tenant, who enters into a Loan Agreement to finance or refinance a Facility; the Authority or a with the Authority "Collateral Proceeds" means any proceeds (other than Prepaid Net Revenues or Retained Funds or Restricted Funds) � from the sale of all or a part of a Facility or from a lump sum settlement in connection with such Facility received by the Authority, whether before or after foreclosure, after deducting all the Authority's expenses and giving credit for any Authority equity in connection therew�th; � "Common Bond Fund" means the fund established and desig- nated in Section 402 hereof from which the principal or Redemption Price of and interest on the General Revenue Bonds are payable; "Common Reserve Account" means the reserve account so created and established by Section 402 nereof and forming a part of the Common Bond Fund, which Common Reserve Account is to be used for the payment of principal or Redemption Price of and interest on the General Revenue Bonds under the circumstances described herein; "Common Reserve Re4uirement" means at any time in re- spect of Bonds not theretofore discharged (a) all Reserve Deposits not theretofore credited against Net Rever.ues or otherwise to the benefit of a Contracting Party in accor- dance with the applicable Revenue Agreement, plus �b) all Prepaid Net Revenues, Collateral Proceeds or Retained Funds in respect of any series of General Revenue Bonds Outstand- ing which have not been applied pursuant to Section 403(d) hereof to the purchase, payment, prepayment, redemption or discharge of such particular series of bonds (or interest or 1 - 3 � premium thereonJ or as credit agaanst payments due from the Contracting Party under the Revenue Agreement related to such series; "Construction Contract" means any contract entered into by the Authority or any Contracting Party and a contractor or contractors under which the contractor agrees to con- struct, install and supply on the Facility Ptemises all or a part of such building, improvements or equipment as are provided in the Plans and Specifications for such Facility; "Construction Fund" means any account esta6lished for each Facility pursuant to Section 311 hereof; "Contractinq Party" means any Person who contracts with the Authority under a Lease, Loan Agreement or other Revenue Agreement; "Debt Service Account" means the account by that name in the Common Bond Fund created and established by Section 402 hereof; "Disbursinq Aqreement" means any Disbursing Agreement for a series of General Revenue Bonds pursuant to which � funds are disbursed from the applicable Construction Fund; "Exempt Earninqs" means any earnings on any Reserve Deposit exempted pursuant to Section 402�d) by the Authority from the lien created hereby, which earnings are to be paid or credited to the benefit of the appllcable Contracting Party. "Facility" means any revenue-producing properties from time to time owned, leased or otherwise financed in whole or in part by the Authority pursuant to this Basic Resolution and operated, used or leased for one or more of the purposes authorized by the Act and more specifically identified in the applicable Revenue Agreement; "Facility Costs" means those costs of a Facility permit- ted under the Act to be financed from the proceeds of Gen- eral Revenue Bonds and more specifically identified in the applicable Revenue Agreement; "Facilitv Premises" means the premises upon which a Facility is located as more specifically identified in the applicable Revenue Agreement; "General Account" means the account by that name in the � General Reserve created and established pursuant to the General Reserve Resolution; 1 - 4 � � � � "General Reserve" means the fund by that name created and established pursuant to the General Reserve Resolution; "General Reserve Resolution" means Resolution No. of the Authority, adopted on , 1983; "General Revenue Bonds" means any General Revenue Devel- opment Bonds of any series from time to time issued by the Authority pursuant hereto and to the applicable Supplemental Bond Resolution; "Guarantee" means an agreement whereby any Petson guar- antees the performance in whole or in oart of any Contrac- ting Party under a Revenue Agreement; "Guarantor" means a Person liable pursuant to a Guaran- tee for the performance of a Contracting Party under a Reve- nue Agreement; "Holder," when used with reference to any General Reve- nue Bond oi Genexal Revenue Bonds, means any Person who shall be the bearer of any Outstanding General Revenue Bond not registered or registered as to principal to bearer or the registered owner of any Outstanding General Revenue Bond which shall at the time be fully registered or registered as to principal other than to bearer, and, when used with ref- erence to any coupon or coupons, means the bearer thereof; "IDB Account" means the special and separate account by that name created and established in the General Reserve pursuant to the General Reserve Resolution and the Supple- mental General Reserve Resolution relatec7 thereto; "Independent Counsel" means any attorney (or firm of attorneys) designated by the Authority and duly admitted t� practice law before the highest court of any state who is not a full-time employee or officer of the Authority or the Contracting Party for the Facility to which the engagement of such attorney (or firm of attorneys) relates and who or which shall be reasonably satisfactory to the Authority; "Independent Enqineer" means an engineer or engineering firm designated by the Authority, registered and qualified to practice the profession of engineering under the laws of the State who or which is not a full-time employee of either the Authority or the Contracting Party for the Facility to which the engagement of such engineer (or eng�neering firm) relates and who or which shall be reasonably satisfactory to the Authority; "L?ase" means any written agreement whereby the Author- ity leases one or more than one Facility to a Person; 1 - 5 � "Loan Aqreement" means any written agreement, otlier than a Lease or Operating Agreement, between the Authority and a Borrower in connection with the financing of a Facility with proceeds of a series of General Revenue Bonds of the Author- ity whereby the Borrower agrees to pay to the Authority or its order such amounts at such times as the Authority deter- mines to be appropriate under such written agreement; "Minimum Deposit" means in respect of any series of General Revenue Bonds the sum designated as such in Section 202 hereof; "Net Revenues" means revenues received by the Authority in respect of any series of General Revenue Bonds and all Facilities and designated as such in Sections 302 or 303 hereof; "Operatinq Aqreement" means a written agreement, other than a Revenue Agreement, between the Authority and any other Person under which such Person operates or cccupies any Facility pursuant to Section 303 hereof; "Operatinq Fund" means the fund or funds established in accordance with Section 303 hereof for tihe purpose of paying � operation and maintenance expenses incurred in connection with the operation of any Facility by the Authority itself or by any Person under the Operating Agreement pursuant to Section 303 hereof; "Operator" means any Person, other than the Authorit�, who operates or occupies any Facility under an Operating Agteement; "Opinion of Bond Counsel" means a written opinion af Bond Counsel delivered to the Trustee; "Opir.ion of Counsel" means a written opinion of legal counsel (who or which may be counsel, except as otherwise expressly provided herein, for the Authority or a Contract- ing Party of the Facility to which the opinion relates) and who or which �s satisfactory to the Ttustee, delivered to the Trustee; "Opinion of Independent Counsel" means a written opinion of legal counsel who or which is not a full-time employee of eit_her the Authority or the Contracting Party of the Facil- ity to which the opinion relates and who or which is satis- factory to the Trustee; � "Outstandinq," when used herein witn reference to Gen- eral Revenue Bonds and as of any particular date, means all � � � � General Revenue Bonds of all series theretofore and there- upon being atithenticated and delivered except: (a) any General Revenue Bond cancelled by the Trustee or surrendered to the Trustee for cancellation at or before said date; (b) any General Revenue Bond discharged pursuant to Article VI hereof or concerning which moneys suffi- cient, together with any investment earnings thereon, to pay on the date of maturity or Redemption Date the prin- cipal or Redemption Price thereof, as the case may be, with interest to the date of maturity or Redemption Date, sha11 have theretofore or thereupon been deposited with the Trustee or one or more Payzng Agents or escrow agents in trust (whether upon or prior to maturity or the Redemption Date of such General Revenue Bond) and, except in the case of a General Revenue Bond to be paid at maturity, of which notice of redemption shall have been duly given; and (c) any General Revenue Bond for which another General Revenue Bond shall have been authenticated and delivered pursuant to the applicable S�pplemental Bond Resolution in lieu thereof or in substitution therefor; provided, however, that in determining whether the Holders of the requisite principa� amount of any particular General Revenue Bonds Outstanding have given any request, demand, authorization, direction, notice, consent or waiver hereun- der, General Revenue Bonds owned by the Authority or the Contracting Party with respect to the Facilities financed thereby or any affiliate of such Contracting Party shall be disregarded and deemed not to be Outstanding except that, in determining whether the Trustee or the Authority, as the case may be, shall 6e protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only General Revenue Bonds which the Trustee knows to be so owned shall be so disregarded (an "affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person; for the purposes of this definition, "control," when used with re- spect to any specified Person, means the power to direct the management and policies of such Person, directly or in- directly, whether through the ownership of voting securi- ties, by contract or otherwise, and the terms "controllinq" and "controlled" have meanings correlative to the forego- ing); provided, further, that General Revenue Bonds so owned which have been pledged in good faith may be regarded as "Oucstanding" if the pledgee estaElishes to the satisfaction of the Trustee or the Authority, as the case may be, the 1 - 7 �� pledgee's right to act as a Holder with respect to such General Revenue Bonds and that the pledgee is not the Au- thority or the Contracting Party or any affiliate of the Contracting Party; provided, further, that a General Revenue Bond which would be considered "Outstanding" but for the fact that money, or money together with investment earn�ngs thereon, sufficient for the payment or redemption thereof has theretofore been deposited in full with the Trustee or any Paying Agent or escrow agent in trust for the Holder thereof (or that the Basic Resolution has theretofore been discharged with respect to the series of which such General Revenue Bond is a part pursuant to Article VI hereof) shall, for the purposes of Article III (to the extent that a de- fault referred to herein or under the applicable Revenue Agreement might adversely affect the exemption from federal income taxation of interest on such General Revenue Bond) and Article VIII (to the extent that any supplement, amend- ment, modification or waiver referred to therein might ad- versely affect the exemption from federal income taxation of interest on such General Revenue Bond), be deemed to be "Outstanding" unless such General Revenue Bond shall be due and payable in accordance with its terms or through redemp- tion proceedings or otherwise as provided in the Basic Reso- lution and the Supplemental Bond Resolution authorizing said series; provided, further, that the Trustee or the Authority shall be fully protected in requiring and relying on an Opinion of Counsel with respect to whether any such default, supplement, amendment, modification or waiver might ad- versely affect the exemption from federal income taxation of interest on any such General Revenue Bond; "Pavinq Aqent" means any paying agent for General Reve- nue Bonds or coupons appointed by or pursuant to Section 7D2 hereof, and its successor or successors and any other cor- poration or association which may at any time be substituted in its place pursuant to this Resolation and the applicable Supplemental Bond Resolution; "Permitted Encumbrances" means any lease and any mort- gage or security agreement securing obligations under a Revenue Agreement and, as of any particular time and for any particular Facility: (a) liens for taxes and special assessments not then delinquent or duly contested as permitted under the applica6le Revenue Agreement; (bj utility, access and other easements and rights-of-way, building, zoning and su6division ordiz- � ances and regulations and any other restrictions and exceptions that Independent Counsel or aiz Independent Engineer certifies will not interfere with or impair the E� � operation of or marketability of title to the Facilit� (or, if it is not being operated, the ooerations for which it was designed and last modified); (c) any mechanic's, laborer's, materialman's, supplier's or vendor's lien or right in respect thereof if payment is not yet due under the contract in question or is duly contested in the manner permitted under the applicable Revenue Agreement; � � (d) such minor defects, irregularrties, encum- brances, easements, rights-of-way and clouds on title as normally exist with respect to properties similar in character to a Facility and do not, in the Opinion of Bond Counsel or Opinion of Independent Counsel, materi- a11y impair the property affected thereby for the pur- pose for which it was acquired or is held by the Con- tracting Party or materially impair the marketability of title to such property; (e) any lien which, in the Opinion of Bond Coun- sel, will not materially impair the security of the Holders; and (f) other restrictions, easements and encum- brances, if any, which are defined as Permitted Encum- brances under the applicable Revenue Agreement; "Person" means any individual, ccrporation, partnership, joint venture, association, 7oint stock company, trust, unincorporated organization or government or any city or political subdivision thereof; "Plans and Specifications" means the plans and specifi- cations, including any modifications thereof, for the con- struction and improvement of a Facility; "Prepaid Net Revenues" means any sum deposited in the Common Reserve Account required under a Revenue Agreement to be so deposited (a) upon termination of such agreement, or �6) upon the sale of the Facility financed in whole or in part by such agreement or (c) pursuant to any prepayment provision in such agreement, but only to the extent the amount of such sum is determined by the amount of funds necessary at the time of such termination, sale or prepay- ment to purchase, redeem or otherwise discharge all General Revenue Bonds Outstanding which financed such Facility in whole or in part; "Pro�ected Debt Service Deficiency" means in respect of a calendar year (a) the amount, if any, by which amouats pro�ected to be withdrawn from the Common Bond Fund (other 1 - 9 � than transfers pursuant to 404(c) hereof) during such year (or remaining due from a prior year) exceed during such year all amounts pro�ected to be deposited in the Common Bond Fund (other than transfers and deposits pursuant to Section 404(a) and the earnings thereon (other than Retained Earn- ings or Exempt Earnings), less (b) all reductions estimated to occur during such year in the Common Reserve Requirement (nat considering any additions to the Common Reserve Re- quirement during such year); � � "Redemption Price," when used with respect to a General Revenue Bond or portion thereof, means the princioal amount of such General Revenue Bond or portion thereof plus the applicable premium, if any, payable upon redemption thereof in the manner contemplated in accordance with its terms pursuant hereto or to the applicable Supplemental Bond Reso- lution; "Reserve Deposit" means in respect of any series of General Revenue Bonds funds meeting the requirements of Section 202 hereof deposited in the Common Reserve Account as the applicable Minimum Deposit and any amounts paid to the Authority or Trustee and deposited in the Common Reserve Account under or in substitution for any amounts payab�e under an Approved Letter of Credit or Subsequent Approved Letter of Credit; "Restricted Funds" means any amounts, iacluding earn- ings, transferred from the Construction Fund established in respect of a series of General Revenue Bonds after comple- tion of the Facility financed in whole or part thereby, which amounts are required under the applicable Revenue Agreement to be applied or held for aoplication solely to the purchase, redemption or discharge of General Revenue Bonds of such series; "Retained Earninqs" means any earnings on sums held in the Common Reserve Account of the Common Bond Fund or any subaccounts therein required under a Revenue Agreement to be applied to or credited against any payments due thereunder or to be credited to the applicable Contracting Party; "Retained Funds" means Retained Earnings or Retained Revenues held in one or more subaccounts of the Common Re- serve Account in accordance herewith; "Retained Revenues" means any amounts (other than Re- serve Deposits, Prepaid Net Revenues or Retained Earnings) required pursuant to a Revenue Agreement to be credited to or deposited in the Common R=serve Account to be held by the Authority and applied to or credited against any payments due under a Revenue Agreement or to be credited to the applicable Contracting Party; 1 - 10 � �I "Revenue Aqreement" means any revenue or other agreement othez than an Operating Agreement, including, without limi- tation, a Lease or Loan Agreement, authorized by the Act and entered into with the Authority by a Contracting Party to finance a Facility; "State" means the State of Minnesota; "Subsequent Approved Letter of Credit" means in respect of a series of General Revenue Bonds a letter of credit delivered to the Trustee on or prior to the later of the expiration date of an Approved Letter of Credit delivered to the Trustee pursuant to Section 402{d) hereof in respect of such series or any other related Subsequent Approved Letter of Credit then drawable upon which has been delivered to the Trustee; provided such letter of credit may be drawn upon by the Trustee to obtain funds (a) promptly (as determined by the Authority) in accordance with the appliable Supplemental Bond Resolution or Revenue Agreement upon the occurrence of any failure to pay any Net Revenues when due under the applicable Revenue Agreement, (b) during a period of at least one (1) year following such later of expiration dates at any time that a Reserve Deposit in respect of such series may be withdrawn from the Common Reserve Accosnt pursuant to Section 403(c)(i) hereof, and the applicable Supplemental Bond Resolution, and (b) within forty-five (45) days pri�r to the expiration of such lettei of credit ("Expiring Let- ter") at any time, provided that General Revenue Bonds of such series are then Outstanding (ar_d not scheduled to finally mature on or prior to such expiration) and provided there has not been delivered to the Trustee prior to such time cash sums for deposit in the applicable Reserve Deposit Account of the Common Reserve Account, another Subsequent Approved Letter of Credit or any combination of such sums and other subsequent Approved Letters of Credit, whereby any such sums, together with any amounts drawable under such other Subsequent Approved Letters of Credit, during the one (1) continuous year immediately following such expiration, equal the maximum amount drawaole under such Expiring Let- ter; a Subsequent Approved Letter of Credit shall be in form and substance and issued by a financial institution satis- factory to the Authority in its sole discretion; "Supplemental Bond Resolution" means a resolution autho- rizing the issuance of a series of General Revenue Bonds pursuant to Section 202 hereof; "Su � tion No 1983; of the Authority, a 1 - 11 n" means Resolu- on Julv 21ST , � � � "Tenant" means any Person who leases a Facili�y from the Authority under a Lease Agreement; "Trustee" means ( J, its successor or assign, or any corporation or association which may at any time be substituted in its place pursuant to Section 709 hereof, and means one or more Persons, as the context may require; and "Underwriter" olis, Minnesota, Authority. means Piper, Jaffray & Hopwood, Minneao- or any other firm or firms appointed by the Section 102. Leqal Authorization. The Authority is a political subdivision of the State of Minnesota le9ally authorized under the Act to finance revenue-producing proj- ects, issue and se11 General Revenue Bonds for that purpcse and refund and discharge such General Revenue Bonds in the mannex and upon the terms set forth in the Act, this Basic Resolution and any 5upplemental Bond Resolution. 1 - 12 �� ARTICLE II GENERAL REVENUE BONDS Section 201. General Authorization to Issue General Revenue Bonds. The Authority may issue General Revenue Bonds payable from the Common Bond Fund as provided 'nerein and in any Supplemental Bond Resolution. Section 202. Issuance of General Revenue Bonds. (a) The Authority may from time to time, sub�ect to the conditions herein, approve the issuance and de- livery of series of General Revenue Sonds for any pur- pose authorized under the Act, including the refunding of obligations pzeviously issued by the Authority, equally and ratably payable from the Net Rever.uns and other funds pledged and appropriaced hereunder for Gen- eral Revenue Bonds of any series theretofore or there- after authorized, but bearing such date or dates and interest rate or rates and with such maturities and redemption privileges, redemption dates and premiums and other terms as may be determined under a Supplemental Bond Rasolution. Every series of such General Revenue Bonds shall be authorized by a Supplemental Bond Resolu- tion, establishing the terms thereof and providing for Net Revenues, which if collected in full and when due will be sufficient to pay the interest when due and to pay and redeem such General Revenue Bonds at maturity or when required by the provisions of such Supplemental Bond Resolution; provided, however, that credit may be given in the applicable Revenue Agreement against Net Revenues due thereundet to the extent of the Reserve Deposit and any Prepaid Net Revenues, CollateraZ Pro- ceeds or Retained Funds deposited under the Revenue Agreement even though at the time such credit is given such Reserve Deposit, Prepaid Net Revenues, Collateral Proceeds or Retained F�nds may have been withdrawn to pay the principal or Redemption Price of or interest on General Revenue Bonds because of defaults in the payment of any Net Revenues. Each series of such General Reve- nue Bonds shall be secured, executed, authenticated and delivered as provided herein and in the applicable Sup- plemental Bond Resolution, and orior to the del;very of such series of General Revenue Bonds there shall be filed wrth the Trustee the Op�nion of Bond Counsel approving the legality of such series of General Revenue Bonds and such other documents and opinions as may be reasonably required by Bond Counsel. No such General Revenue Bonds, however, shall be issued, executed, authenticated or celi��ered if an effect thereof would be 2 - 1 � to sub�ect the interest payable on any other issue of General Revenue Bonds to federal income taxes. Na series of General Revenue Bonds sha11 be issued, exe- cuted, authenticated or delivered unless either consent to the issuance of such General Revenue Bonds and the approval of the Supplemental Bond Resolution authoriz�ng issuance of the General Revenue Bonds has been secured from the Underwriter (which consent shall not 6e unrea- sonably wzthheZd) or such consent and approval has been secured from the Holders of not less than £i£ty-one percent (51$j of the aggreqate principal amount of the then Outstanding Genexal Revenue Bonds in the manner provided herein. However, Additional General Revenue Bonds in an amount sufficient to complete a Facility may be issued in accordance with Section 311(d) hereaf with- out such Underwriter's or Holders' consent. (b) No General Revenue Bonds of any series shall be issued under this Section 202 or secured by the Com- mon Bond Fund or the IDB Account unless at or prior to the time of such issuance: (i} subject to Section 902(d) hereof there shall have been deposited in the Common Reserve Account of the Common Bond Fund, from funds to which no lien has theretofore attached which re- mains undischarged under this Basic Aesolution, a "Minimum Deposit" for such series which shall be a sum equal to the lesser of (Aj the maximum aggre- gate principal and interest on the General Revenue Bonds of such series scheduled to become due in any future calendar year (determined with respect to such series as o£ the date of the Bond Closing thereof and taking into account redemptions only if made pursuant to a mandatory redemption schedule) and (H) fifteen gercent (15$) of the orzginal face amount of such series, unless the net proceeds received by the Authority from issuing such series {after deducting all expenses of issuing such series) is less than ninety-eight percent (98�) of such original face amount, in which case fifteen percent (15�) of such net proceeds; provided, how- ever, that if for any period any taond of a sezies of General Revenue Bonds bears interest at a rate of intetest which is determinable pursuant to a procedure based on a potentzally fluctuating index or standard, for the purpose of determining the Minimum Deposit required hereby for such series oP bonds, the interest rate on such bond for such � period shall be deemed pqaal to the rate cahich results from applicat�on of the procedure to the index or standard as it actually exists at the time of Bond Closing. 2 - 2 � (ii) there Common Bond Fund under or under Resolution with posited therein; � �� shall have been deposited in the all other payments required here- the applicable Supplemental Bond respect to such issue to be de- (iii} there shall be on deposit in the IDB Account a sum (or investments valued at market in the reasonable discretion of the Authority) equal to the lesser of (Aj five million dollars ($5,000,000) and (B) ten percent (10�) of the aggregate face amount of all General Revenue Bonds Outstanding immediately prior to such issuance plus the face amount of all bonds of such series to be so issued; and (iv) the Authority shall have certified the facts described in (i), (ii) and (iii) above in writing to Bond Counsel. Section 203. Obliqations Not Secured bv the Basic Reso- lution. The Authority reserves the right and power, in its discretion, to issue outside of this Basic Resolution any other obligations issued and secured under the provisions of any authorizing resolution for any purpose authorized by the Act or any other law, including the refunding of any General Revenue Bonds. Such obligations shall not be secured by the covenants and provisions hereof and may be issued without regard to the limitations contained herein. No obligations so issued or premium or interest thereon shall be payable from or be entitled to any lien or charge on the Common Bond Fund or the IDB Account. 2 - 3 � � I � ARTICLE III GENERAL COVENANTS Section 301. Payment of Principal or Redemption Price and Interest. Sub�ect to Section 307 and the provisions herein, the Authority covenants that it will promptly and duly pay or cause to be paid the principal or Redemption Price o£ and interest on all General Revenue Bonds issued hereunder and under the applicable Supplemental Bond Resolu- tions at the place, on the dates and in the manner provided in such Supplemental Bond Resolutions and in the General Revenue Bonds and any coupons appurtenant thereto. Section 302. Net Revenues Derived From Contractinq Party. Prior to the issuance of each series of General Revenue Bonds, the applicable Contracting Party shall enter into a Revenue Agreement with the Authority requiring the Contracting Party to pay to the Authority amounts which are sufficient to pay when due the principal or Redemption Price of and interest on the General Revenue Bonds of such series; provided, however, that credit may be given in the appli- cable Revenue Agreement against Net Revenues due thereunder to the extent of the Reserve Deposit and any Prepaid Net Revenues, Collateral Proceeds or Retained Funds deposited under the Revenue Agreement even though at the time such credit is given such Reserve Deposit, Prepaid Net Revenues, Collateral Proceeds or Retained Funds may have been with- drawn to pay the principal or Redemption Price o£ or inter- est on General Revenue Bonds because of dePaults in the payment of any Net Revenues. The Contracting Party shall also be required under such Revenue Agreement to pay a11 taxes and special assessments levied on or with respect to the Facility financed by such series of General Revenue Bonds, all costs of operation, maintenance, repairs, insur- ance and utilities and all other costs (except such costs, if any, as may be specifically agreed to be paid by the Authority from available funds). The Vet Revenues of a Facility, in addition to the meaning assigned such term in Section 343 hereof, means (a) all amounts required under the applicable Revenue Agreement to be paid to the Authority by or on behalf of the applicable Contracting Party for the purpose of providing funds which if paid when due will equal and fund when due all payments of principal and xnterest on General Revenue Bonds of the applicable series scheduled as of such Bond Closing to become due thereafter and (b) any other amounts required pursuant to a Revenue Agreement to be deposited in the Common Bond Fund subsequent to Bond Closing (but not inc�uding Reserve Deposits, Prepaid Net Revenues, Collateral Proceeds, Administrative Fees, Retained Funds, Restricted Funds, Exempt Earnings, amounts required under a 3 - 1 � Revenue Agreement to be deposited in the Common Reserve Account or any charges payable to the Authority for specific costs to be paid by the Contracting Patty or any Guarantor under the applicable Revenue Agreement or any related Guar- antee, except as and to the extent any such amounts shall be applied or credited aqainst amounts otherwise payable as Net Revenues). Section 303. Net Revenues From Operations. For each Facility operated by the Authority itself or an Operator under an Operating Agreement, the Author=ty will maintain an account to be designated as the Operating Fund �f that Facility, reflecting all revenues derived from that Facility and all operatinq costs incurred by the Authority in respect of the Facility. The revenues from time to time deposited in the Operating Fund shall be applied first to the payment, promptly as incurred, of all necessary, reasonable and cur- rent costs of the operation of such Facility, determined in accordance with accepted accounting practices, including, but without limitation, reasonable administrative expenses incurred solely with respect to the operation of the in- dividual Facility; current maintenance and repairs necessary to maintain such Facility in adequate operating condition; labor and the cost of materials and supplies necessarily used for such current operation, maintenance and repairs; � insurance of the premises against risks and in amounts for which insurance is usually carried by prudent owners of like properties; insurance of the Authority and its officers and employees against liability for damage to persons and prop- erty incurred in connection with such operation in amounts such as are usually carried by prudent operators of similar enterprises or in lesser amounts to which the Authority's liability may be limited by law; and charges for accumula- tion of appropriate reserves for the payment of operating costs which recur periodically but in varying amounts. The operating cost5 of any Facility shall not znclude any al- lowance or payment for depreciation, renewal, replacement or improvement of or additions to capital assets; any pertion of the salary or wages paid to any officer or empZoyee of the Authority or any liability incurred by the Authority or any officer or employee for damage to persons or property in excess of the amount of such liability compensated by insur- ance. The Net Revenues of any such Facility constitute all those revenues from time to time received by the related Operating Fund in a given calendar month, determined, in the discretion of the Authority, to exceed total operating costs incurred or payable in such month. Section 304. Pledqe of Available Revenues. All Avail- � able Revenues are hereby pledged and appropriated and shall be credited as received by or credited to the Common Bond Fund (and the accounts therein) to the extent and in the 3 - 2 � manner set forth in Sections 401, 402, 403 and 404 hereof. The pledge herein made shall constitute a first and prior lien on all Available Revenues derived an respect of a11 Facilities; provided, however, that as set forth in Section 404(c) hereof, the Available Surplus for a calendar year is hereby pledged and irrevocably appropriated and shall be transferred to the IDB Account (subject to Section 404(a) hereof); and provided further that in accordance with Sec- tion 403(e) hereof Administrative Fees sha11 6e transfeered to the General Account in the General Reserve. Section 305. Books and Records. The Authority cove- nants that so long as any General Revenue Bonds of any series are Outstanding and unpaid the Authority will keep or cause to be kept proper books and records and accounts in which full, true and correct entries will be made of all its financial dealings or �ransactions with and in relation to a11 Facilities, Reserve Degosits, Restricted Funds, the IDS Account, and all Net Revenues and all other sums derived under a Revenue Agreement or Guarantee. The foregoing books sha11 be ogen to inspection and cogying during a11 reason- able business hours by any Holder or the agent or attorney of such Holder, and the costs of any copying shall be borne by the applicabLe Holder ox the agent or attorney of such Holder. Any Operating Funds, Restricted Funds, and each account in the Common Bond Fund and the IDB Account in the General Reserve wi11 be audited and certified annually 6y an independent certified public accountant selected by the Authority, no later than one hundred twenty {120) days fol- lowing the close of each calendar year, and the report of each such audit will b= made available for examination at all reasonable business hours by any Holder of such General Revenue Bonds, without charge. A copy of the regort of each such audit shall be filed with the Underwriter, the rating bureaus, the Minnesota Department of Energy, Planning and Development, the Office of the Tieasurer or Executive Direc- tor of the Authority and with each Holder who formally re- quests in writing each year that the name and address of the Holder be kept on file with the Authority for such audit distribution purposes. Section 306. List of Holders. To the extent that such information is made available to the Authority, the Author- ity will keep or cause to be kept a list of the names azd addresses of the last-known Holders of all General Revenue Bonds and the serial numbers of the General Revenue Bonds believed to be held by each of such last-known Holders. Any Holder may request that his name and address be placed on said list by filing a written request therefor with the � Authority, which reauest shall include a statement of the principal amount of General Revenue Bonds held by such Holder and the serial numbers of such General Revenue Bonds. The Authority shall be under no responsibility with 3 - 3 � regard to the accuracy of said list. At reasonable times and under reasonable regulations established by khe Author- ity, said list may be inspected and copied by Holders and/or owners (or a designated representative thereof) of ten per- cent (10�) or more in principal amount of General Revenue Bonds Outstanding hereunder, such authority of any such designated representative to be evidenced to the satisfac- tion of the Authority. Section 367. Nature of Security. The Genetal Revenue Bonds shall not be payable from or be a charge upon any funds of the AuChority other than the revenues and funds pledged to the payment thereof; nor may any Holder or Hold- ers of the General Revenue Bonds have the right to compel any exercise of the taxinq power of the Authority to pay the principal or Redemption Price of any General Revenue Bonds or the interest thereon or to anforce payment thereof against any property of the Authority other than the reve- nues and other amounts so gledged, The General Revenue Bonds shall not otherwise constitute a charge, lien or en- cumbrance, legal or equitable, upon any property of the Authority, and no General Revenue Bond of any series shall constitute a debt of the Authority within the meaning of any constitutional or statutory limitation; but nothing herein � shall impair the rights of the Holders of General Revenue Bonds to enforce the covenants made for the security thereof as provided hezein, and by authority of the Act, the Author- ity has made the covenants and agreements herein for the equal and proportionate benefit of all Holders of the Gen- eral Revenue Bonds of every series and any coupons appur- tenant thereto to the extent and in the manner herein pro- vided. Section 308. Enforcement of Covenants. The Authority covenants that it will promptly give all notices and do all other acts and things reguired under the terms of all ap- plicable Leases, Loan Agreements, Operating Agreements, Guarantees and other aqreements it may from time to time have entered into with Contracting Parties, Guarantors or Operators with respect to any of the Facilities for the performance of obligations o£ the Authority and for the en- forcement of all obligations of such Contracting Parties, Guarantors ot Operators and for the collection of all ren- tals, payments on notes or other similar payments or rates and charges to become due, to the extent and in the manner that the Authority reasonably determines is prudent and necessaty to protect the interests of the Holders; provided that nothing herezn sha11 prevent the Authority, with or without the consent of or notice to the Holders and at its � sole disrretion, from renegotiating any such Lease, Loan Agreement, Guarantee, Operating Agreement or other agreement or from waiving any default thereunder so long as such re- 3 - 4 � negotiation or waiver is consistent with covenants made herein and in the applicable Supplemental Bond Resolution; and provided further that the Authority may act upon the Opinion of Bond Counsel, Opinion of Independent Counsel or advice of an Independent Engineer or certified public ac- countant selected by the Authority in the exexcise of rea- sonable care; and the Authority shall not be responsible for any loss or damage resulting from nonaction or from any action taken in good faith in xeliance upon such opinion or advice. Section 309. Production of Adequate Revenues. The Authority covenants that, consistent with and in accordance with the terms hereof and of any applicable Revenue Agree- ment at the time in effect, the Authority shall use its best efforts to lease, operate or otherwise cause each Facility to be used or held for sale and shall require such rentals, prices, payments on notes or other similar payments or rates and charges in connection with each such Facility as are sufficient to assure prompt payment of principal or Redemp- tion Price of and interest on all General Revenue Bonds which financed, in whole ot in part, such Facility. Section 310. Authority Staff Support. The Authority shall employ and maintain a staff or consultants to adminis- ter the operations of the Authority in numbers, skill and training so as to permit the Authority to use such best efforts to continuously: {a) monitor pezformance by all Contracting Pazties of their covenants in the Revenue Agree- ments, (b) expend such time as is practicable and appropri- ate on leasing and re-leasing Facilities operated by itself or under an Operating Agreement, (c) enforce all covenants in the Revenue Agreements as may from time to time be re- quiied to assure a continuous flow to the Authosity of Net Revenues from Facilities and (d) perfarm such other duties as may from time to �ime be required to provide sufficient Net Revenues and other sums required to be deposited hereun- der to meet the requirements hereof; provided that nothing herein shall be construed as imposing a duty on the Author- ity to review any financial statements of any Contracting Party filed with the Authority in accordance with the provi- sions of a Revenue Agreement. Section 311. Construction Funds; Facilities Financed t G (a) Before issuing any series of General Revenue Bonds in accordance with Section 202 hereof to finance the acquisition, instaliation, construction or improve- � ment of any Facility, the Authority shall cause to be established an account to be designated as the Construc- tion Fund €ot such Facility. The Authority shall credit 3 - 5 � or allocate to such ConstruCtion Fund all proceeds of the applicable General Revenue Bonds except any portion thereof deposited in the Common Bond Fund: (i) in accor- dance with Section 902(d) hereof, (ii) to pay interest accxued on such General Revenue Bonds prior to the Bond Closing thereof, or (iii) for any purpose in accordance with the applicable Supplemental Bond Resolution. Sub- ject to the terms hereof, the amounts and earnings thereon in each Construction Fund shall be held and disbursed therefrom in accordance with the applicable Supplemental Bond Resolution, Revenue Agreement and Disbursing Agreement. (b) The following shall apply to each Construction Fund: (i) Prior to completion of any Facility, as determined in accordance with the applicable Reve- nue Agreement, moneys in the related Construction Fund may be used only to pay or reimburse payment of any related Facility Costs which may be financed by General Revenue Bonds under the Act or, to the extent permitted in the applicable Supplemental Bond Resolution, to pay obligations of the Con- tracting Party due under the applicable Revenue � Agreement or to redeem the applicable General Reve- nue Bonds. Earnings on sums in the Construction Fund shall not be disbursed until the applica6le Facility is campleted in accordance with the appli- cable Revenue Agreement. (ii) No draw for Facility Costs (other than for costs related to the issuance of the applicable General Revenue Bonds) shall be allowed for payment or reimbursement from the applicable Constiuction Fund unless sums held in the Construction Fund are sufficient to pay all such Facility Costs then estimated to be necessary for completion of the applicable Facil�ty in accordance with the appli- cable Plans and Specifications. (i�i) No draw for Facility Costs shall be per- mitted unless an executed Construction Contsact (or Contracts) shall have been filed with the Authority providing for the completion of the Facility in accordance with the Plans and Specifications, and unless waived by the Authority, a payment and per- formance bond shall have been secured £rom each applicable contractor, executed by a responsible � surety compar.y authorized to do business in thP State in a penal sam equal to the entire amount to become payable under the contract and conditioned 3 - 6 � as required �y law for the completion �f the work in accordance with the Plans and Specifications and for the payment of all amounts due to subcontrac- tors and suppliers. Notwithstanding the forego�ng sentence, a draw for Facility Costs may be permit- ted, solely in the discretion of the Authority if a Construction Contract sha11 have been entered into for at least the work and materials for which the draw is requested (or if the work and materials were not furnished pursuant to a Construction Con- tract, other evidence satisfactory to the Authority that the work and materials shali have been fur- nished in accordance with the Plans and Specifica- tions) and the Authority sha11 have received writ- ten estimates of the total cost of completing the Facility, and the Authority shall have secured such bond or such other assurances as it deems necessary to assure completion of the Facility and payment of the costs thereof. (iv) No draw shall be allowed for payment or reimbursement under any Construction Contract until approved by the Authority or its agent and except in accordance with the applicable Disbursing Aqree- ment. � (c) The Authority shall use its best efforts to aause the Contracting Party under each Revenue Agr.eement to cause each Facility to be completed as provided by the applicable Plans and Specifications and Construction Contract or Contracts (if any); and the Authority shall thereafter, consistent with its rights under thP appli- cable Revenue Agreement, use its best efforts to: (i) cause the same to be operated or held for sale for one or more of the purposes set forth in the Act and (ii) with resgect to any Facility in which the Authority holds title or has a mortgage or other security inter- est, hold such Facility free from all liens thereon except Permitted Encumbrances. The Authority sha11 hold all Net Revenues and other sums derived by the Authority from each Facility free from all liens other than the liens herein granted or provided for. (d) In the Supplemental Bond Resolution autho- rizing a series of General Revenue Bonds respecting any Facility the Authoxity may reserve the power to issue Additional General Revenue Bonds under Section 202 hereof in any amount which may be found necessary by the Authority to pay all claims payable from the appiicable � Construction Fund until the Facility is completed. N� liability will be incurred by the Authority for the payment of capital costs in excess oi the amount of the 3 - 7 � General Revenue Bonds agreed to be issued for a Facil- ity, until and unless the amount of such excess is de- posited in the applicable Construction Fund; provided that nothing herein shall be construed as prevenLing the Authority from using its own funds or funds from other sources to meet such excess requirements allocated and, thereupon, receiving reimbursement for any such advance in accordance with the applicable Revenue Agreement. � � (e) Upon completion of a Facility in accordance with the applicable Revenue Agreement and upon adequate provision having been made for payment of all costs thereof, any balance remaining in the Construction Fund related thereto, including any remainder of deposited funds and earnings thereon, shall be allocated and dis- bursed in accordance with the provisions of the applic- able Supplemeatal Bond Resolution, Revenue Agreement and Disbursing Agreement. Section 312. Enforcement of General Revenue Bond Cov- enants. No Holder of any General Revenue Bond of any series shall have the right to institute any suit, action or pro- ceeding, in equity or at law, for the enforcement of any covenant contained herein, in any Supple�ental Bond Resolu- tion or Revenue Agreement unless: (a) there shall have been obtained, prior to in- stituting such suit, action or proceeding, the written concurrence thereto by the Holders of not less than ten percent (10�) in aggregate principal amount of all Gen- eral Revenue Bonds then Outstanding ot twenty percent (20�) in aggregate principal amount of any series of General Revenue Bonds then Outstanding, and pursuant to such concurrence, a written request, containing the reasons therefor, shall have been made of the Trustee to institute such suit, action or proceeding; and (b) the Trustee shall have refused or neglected to comply with such request within forty-five (45) days after the Trustee's receipt of such request or the Trustee shall have given written consent thereto; and (c) such suit, action or proceeding is initiated and continued for the ratable benefit of all Holders of each series of General Revenue Bonds Outstanding and any coupons appurtenant thereto which may be directly affec- ted, adversely or favorably, from the disposition of such suit, action or proceeding, subject to the provi- sions hereof. The Holders of fifty-one percent (51�) in principal amount of the Outstanding General Revenue Bonds shall have � � � � the right to direct the Trustee on their behalf to direct the time, method and place of conducting any proceeding for any remedy avallable to the Holders of such General Revenue Bonds and for the exercise cf any power conferred on them and the right to waive a default in the performance of any covenant and its consequences as it rel.ates to such General Revenue Bonds, except a default in the payment of the prin- cipal or Redemption Price of or interest on any such General Revenue Bond when due or required to be redeemed. However, nothinq herein shall impair the absolute and unconditional riqht of the Holder of each General Revenue Bond to receive payment of the principal or Redemption Price thereof and interest thereon at the times provided in the applicable Supplemental Bond Resolution and to institute suit for the enforcement of any such payment in accordanoe with the terms of the General Revenue Bond to the extent not inconsistent herewith. Before the Holders may take or require the Au- thority or the Trustee to take any action hereunder, the Authority and the Trustee may require that each be furnished an indemnity bond satisfactory to it for the reimbursement of all expenses which it may incur in such regard and to protect it against all liability, except liability which is adjudicated to have resulted from the negligence or willful default of the Authority or the Trustee, by reason of any action so taken by the Holders, the Authority or the Trustee. Notwithstanding anything in this Section to the con- trary, no Holder of any General Revenue Bond or any coupon appurtenant thereto shall have any right in any mannex what- ever by such Holder's action to affect, disturb or prejudice the lien and security interest of the Authority pursuant hereto or to the Supplemental Bond Resolution or to the applicable Revenue Agreement on any Facility or any part theteof or, except in the manner herein provided, to enfoxce any right hereunder. All rights of action hereunder, under the applicable Supplemental Bond Resolution or upon any of the General Revenue Bonds of any seties or any coupons appurtenant thereto which are enforceable by the Holders may be enfocced by the Trustee on behalf of the Holders without the posses- sion of any of the General Revenue Bonds or any coupons appurtenant thereto or the production thereof at the trial or other proceedings relative thereto, and any suit, act?on or proceeding so instituted by the Trustee shall be brought in its name as the trustee of an express trust, and any recovery of 7udgment shall be for the ratable benefit of the Holders of said General Revenue Bonds and any coupons appur- tenant thereto in respect of which such �udgment sha11 have been recovered, sub�ect to the pcovisions hereof. 3 - 9 � Section 313. Operation of Facilities. Subject to the provisions of Section 308 hereof, the Authority agrees in the event of a default under a Revenue Agreement with re- spect to any Facility to which the Authority has title or in which it has a mortgage or other security interest, that it will use its best efforts while any General Revenue Bonds remain Outstanding and undischarged to lease or otherwise cause the Fdcility to be operated ta provide revenues to help pay the principal or Redemption Price of and interest on the General Revenue Bonds and maintain the Common Bond Fund and, in the event af sa1e, to secure the best pr;ce obtainable. This covenant, to the extent that it may obli- gate the Authority to lease, re-lease or sell any Facility for the benefit of the Holders, may be enforced against the Authority only to the extent that at such time the Authority is permitted by law to sell the property or to the extent that any consent required for leasing or re-leasing the property has been given. Section 314. Insurance. Consistent with the applicable Revenue Agreements, the Authority shall use its best efforts to cause a11 Facilities to be insured with responsible insurance companies against all risks and in the amounts for which insurance is usually carzied by prudent owners of like � properties and will cause the Authority and its officers and employees to be insured against liability for damage to per- sons and pcoperty incurxed in connection with its ownership or operation of any such Eacility, in such amounts as it deems appropriate, and will cause a provision for the main- tenance of such insurance to be included in each applicable Revenae Agreement. Section 315. Performance bv Authority of Covenants. The Authority covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions to be pefformed by it contained herein, in each and every General Revenue Bond executed, authentiozted and deliveced hereunder and in all proceedings of its gov- erning body pertaining thereto; that it is duly authorized undei the Constitution and laws of the State, including particularly and without limitation the Act, to issue Gen- eral Revenue Bonds (and to make the pledqe set forth in Section 401 hereof in connection therewith) in the mannet and to the extent herein set foxth; that all action on its part for the issuance of General Revenue Bonds and for the execution and delivery of each series thereof has been or shall be duly and effectively taken; and that such General Revenue Bonds in the hands of the Holders and owners thereof are or shall he valid and enforceable o6ligations of the � Authority accordzng to the terms thereof. 3 - 10 � � � ARTICLE IV FUNDS AND ACCOUNTS Section 401. Funds Pledqed and Assigned. Ali Accumu- lated Revenues, Available Revenues, Net Revenues, Prepaid Net Revenues, Retained Funds, Collateral Proceeds, Adminis- trative Fees and Reserve Deposits from time to time to be received or retained 6y the Authority (but not including any Exempt Earnings or any Restricted Funds) are hereby pledged and appropriated to secure the payment in accordance here- with when due of all principal and Redemption Price of and interest on all General Revenue Sonds of any Series from time to time Outstanding. All Net Revenues, Prepaid Net Revenues, Retained Funds, Collateral Proceeds, Administra- tive Fees, Reserve Deposits and other sums required to be deposited oz credited in the Common Bond Fund i�ahich shall not include Restricted Funds or Exempt Earnings) pursuant hereto or an applicable 5upplemental Bond Resolution shall be credited to the funds and accounts described herein to the extent, in the manner and for the purposes set forth herein and in all applicable Supplemental Bond Resolutions; and to the extent deposited and retained in the Common Bond Fund or IDB Account of the General Reserve, but subject to this Atticle IV, such amounts (not including Exempt Earnings or Re�tricted Eunds) shall not 6e sub�ect to any lien or attachment by any creditor of the Authority other than the lien of Holders. Section 402. Common Bond Eund. (a) Common Bond Fund. There is hereby created and established a Common Bond Fund which shall constitute a special and separate fund to 6e held by the Trustee. The Common Bond Fund shall consist of the Debt Service Account, Common Reserve Account and Administrative Fee Account as special and separat� accounts in the Common Bond Fund, which sgecial and segarate accounts are hereby created and established. The Authority from time to time as required shall cause to be established and created within the Common Reserve Account segregated subaccounts wiTh respeat to each series of Genexal Reve- nue Bonds to hold separately each of the following: (i) Reserve Deposits, (ii) Prepaid Net Revenues, (iii) Col- lateral Proceeds, and (iv) Retained Funds. The Author- ity may establish such additional suqaccounts within any of the foregoing accounts as it deems appropriate, pro- vided that claims permitted hereunder to any amounts held in any such account shall not in any manner be impaired theceby. Reference to the Common Bond Fund herein shall include reference to all accounts and sub- 4 - 1 � accounts therein, unless otherwise stated. Unless otherwise provided herein or in the applicable Supple- mental Bond Resolution, withdrawals permitted or re- quired from any account established hereunder may be made from any subaccounts in sucn account in any order of withdxawal, as the Authority in its sole discretion shall determine. (b} Debt Service Account. In addition to trans- fers or payments into the Debt ServiCe Account pursuant to Sections 402(h), 404(a), and 403(d)(ii� hereof and subject to withdrawals in accordance herewith, the Authority shall deposit in or credit to such account all Net Revenues when received by the Authority and, to the extent required by any applicable Supplemental Bond Resolution or Revenue Agreement and to the extent not inconsistent herewith, proceeds from General Revenue Bonds for the payment of interest accrued on the appli- cable series of General Revenue Bonds prior to the Bond Closing therefor or thereafter (to the extent such pro- ceeds may be lawfully so applied) or oth2rwise. Earn- ings on all funds held in or credited to the Debt Ser- vice Account shall be credited to such account. (c) Common Reserve Account. In addition to trans- � fers or payments into the Common Reserve Account pursu- ant to Sectiona 402(h) and 404(a) hereo£ and sub�ect to withdrawals in accordance herewith, the Authority sha11 deposit each of the following funds in respect of a series of General Revenue Bonds into separate subac- counts established for such Series in the Common Reserve Account: all Reserve Deposits, Prepaid Net Revenues, Collateral Proceeds, and Retained Funds. Subject to Sections 402(d) and 402(e) hereof, earnings (other than Exempt Earnings or Retained Earnings) on any funds held in the Common Reserve Account or in any subaccount thereof shall be credited to such account or subaccount as the case may be. (d) Reserve Deposit F _ of Credit. I.1 (i) The Minimum Deposit required by Section 202 hereof in respect of each series of General Revenue Bonds may be met by deposits of any unen- cumbered funds qualifying under such Section, in- cluding proceeds of the General Revenue Bonds in respect of which any such *equirement arises and funds provided by or on behalf of the applicable � Contracting Party. Additionally, the Minimum De- posit shall be deemed met in respect of any series of Ger.eLal Revenue Bonds to the extent of amounts drawable under an Approved Letter of Credit. 4 - 2 � r� � � � (ii) If at any time the Reserve Deposits re- tained 1n the Common Reserve Account are inadequate to meet any withdrawals otherwise required to be made hereunder from Reserve Deposits, the Trustee shall, in such order of priority as the Trustee deems appropriate (but not inconsistent with any applicable Supplemental Bond Resolution or Revenue Agreement) promptly draw upon funds available under any Approved Letters of Credit or Subsequent Ap- proved Letters of Credit, if any, in an aggregate amount adequate for such withdrawals, and the Trustee shall promptly deposit such amounts in the applicable Reserve Deposit subaccounts in the Com- mon Reserve Account. Between forty�five (45) and thirty (30) days prior to the expiration of any Approved Letter of Credit or Subsequent Approved Letter of Credit ("Expiring Letter") the Trustee shall cause such Expiring Letter to be fully drawn if any General Revenue Bonds of the series to which such Expiring Letter relates are then Outstanding (and not scheduled to finally mature on or prior to the date of such expiration), and if there has not been delivered to the Trustee prior to such time cash sums for deposit in the agplicable Reserve Deposit subaccount in the Common Reserve Account, another Subsequent Approved Letter of Credit or any combination of such sums and other Subsequent Ap- proved Letters of Credit, whereby any such sums, together with any amounts drawable under such other Subsequent Approved Letters of Credit during the one (1) year immediately following such expiration, equal the maximum amount drawable under such Expir- ing Letter. Notwithstanding any other provision herein, before any withdrawal of Reserve Deposits pursuant to Section 403(c)(ii) hereof, the Trustee shall fully draw upon any Approved Letter of Credit or Subsequent Approved Letter of Credit in respect of which a default has occurred in any payment of Net Revenues under the applicable Revenue Agreement (unless such default has been *_heretofore cured). (iii) Notwithstanding anything to the contrary herein, the Authority may permit all or any portion of the earnings on Reserve Deposits to be free of any lien created hereby or credited to the benefit of the applicable Contracting Party or its designee under terms and conditions established in the applicable Supplemental Bond Resolution or Revenue Agreement, provided that in no event may the prin- cipal amount of any such Reserve Deposit be free of the lien thereon created hereby. 4 - 3 � (e) Retained Earninqs. All Retained Earnings shall be credited to the subaccount maintained for Re- tained Funds for the applicable series of General Reve- nue Bond to which such Retained Earnings relate. (f} Administrative Fee Account. Subject to with- drawals in accordance herewith, the Authority shall deposit all Administrative Fees when received into the Administrative Fee Account; provided, however, that 1f the aggregate sums in a given month oaid or credited as paid by a Contracting Party for Administrative Fees and Net Revenues are less than the total Administrative Fees and Net Revenues due to the Authority from such party in such month, the aggregate sums so paid sha11 be allo- cated to the extent thereof first to satisfy such Net Revenues due (after satisfaction of any past due unpaid amounts of Net Revenues) and then to satisfy such Admin- istrative Fees (after satisfaction of any past due un- paid amounts of Administrative Fees). Earnings on funds in the Administrative Fee Account shall when credited be deemed a deposit of Administrative Fees to such account. (g) Restricted Funds. Restricted Funds received by the Authority in respect of any series of General � Revenue Bonds shall be deposited in such fund, account or subaccounts not maintained in the Common Bond Fund as the Authority shall in its sole discretion determine, but subject to the terms of any applicable Revenue Agreement or Supplemental Bond Resolution, any amounts, including earnings, in any such fund, account or subac- count shall be applied, withdrawn or credited to the benefit of a Contracting Party as provided in the appli- cable Supplemental Bond Resolution or Revenue Agreement. (h} Miscellaneous Fundinq. Amounts received by the Authority in respect of any Facility or Revenue Agreement not otherwise required hereunder to be de- posited in a specific fund, account or subaccount estab- lished hereby may be deposited in any fund, account or subaccount, sub�ect to any provisions not inconsistent herewith in any Supplemental Bond Resolution or Revenue Agreement, relating to the deposit, withdrawal, transfer or use of funds therein, cr the treatment of earnings thereon. Section 403. Withdrawals. (a) Bond Pavments. Except as otherwise provided herein, all payments required hereunder to be made by � the Authority of principal or Redemption Price of o� interest on General Revenue Bonds of any series when due 4 - 4 � shall be made from funds, to the exten*_ available therein, in the following order of priority: (i) first from the Debt Service Account, (ii) then from the Admin- istrative Fee Account, (iii) then from Reserve Deposits in the Common Reserve Account {in the order of priority hereinafter established), and (iv) then from subaccounts other than for Reserve Deposits in the Common Reserve Account in such order of priority as the Authority in its discretion may determine; to the extent such forego- ing funds shall not be sufficient to make all such pay- ments, such payments shall be made, to the extent of funds therein, from the IDB Account in accordance with Section 404(a) hereof. (b) Debt Service Account. In addition to with- drawals pursuant to Sections 404(a) and 404(c) hereof, and any amounts advanced by the Authority on behalf of a Contracting Party pursuant to the applicable Supple- mental Resolution, funds required hereunder to be de- posited in or credited to the Debt Service Account may be withdrawn and used while General Revenue Bonds are Outstanding only for the payment of: (i) interest on General Revenue Bonds as or after it becomes due and payable, including accrued interest on any General Reve- nue Bonds redeemed before maturity pursuant to the � applicable Supplemental Bond Resolution, increases in interest resulting from a series of General Revenue Bonds becoming taxable Eor federal tax purposes, inter- est accruing on any General Revenue Bond after its stated maturity, if such bond is not then paid or re- deemed, and to the extent that payment of such interest is lawful, interest upon overdue installments of inter- est due on General Revenue Bonds at the rate borne by such General Revenue Bonds, {ii) the principal amount or Redemption Price of any General Revenue Bonds at their stated maturities or when called for redemption and pre- payment in accordance with any applicable Supplemental Bond Resolution, (iii) the discharge of General Revenue Bonds of any series in accordance with Article VI hereof, or the purchase of any such bonds in accordance herewith or with any applicable Supplemental Res�lution, and (iv) any amounts for N�hich the Authority has a right of reimbursement f_*om a Contracting Party or Guarantor paid in the reasonable discretion of the Authority to prevent impairment of the first lien created hereby or any equity or security interest of the Authority in any Facility. Notwithstanding any other provision herein, amounts constituting Net Reven�es received by the Au- thority after they were due and payable may be trans- � ferre3 to any subaccount in the Common Reserve A_ccourt to the extent amounts in such account were aithdrawn because of the delay in receipt of such Net Revenues. 4 - 5 � (c) Reserve Deposits. In addition to withdrawals pucsuant to Section 404(c) hereof, while any General Revenue Bor.ds are Outstanding Reserve Deposits shall be used and withdrawn only (i) for the last payments of the principal or Redemption Ptice of or interest on the applicable series of General Revenue Bonds; and (ii) for any purposes for which funds in the Debt Service Account may be withdxawn, but only after exhaustion of the Administrative Fee Account and the Debt Service Account (as determined before any transfers thereto pursuant to Section 404(a) for the specific purpose for which such withdrawal is required). Withdrawals from Reserve Deposits pursuant to clause (�i) of this subparagraph (c) shall be made (A) first from the Reserve Deposits relating to any Revenue Agreement in respect of which Net Revenues therefrom are �n default (such withdrawals being made in proportion and to the extent of such Net Revenues), and (B) then fram all remaining Reserve Deposits proportionally in respect of the oriqinal Mini- mum Deposit to which each Reserve Deposit relates. Reserve Deposits credited against Net Revenues otherwise due under a Revenue Agreement sha11 be transferted to the Debt Service Account as and when so credited. � (d) Prepaid Net Revenues, Collateral Proceeds and Retained Funds. (i) Subject to Section 404 hereof, any fun�s required hereunder to be deposited in or credited to any subaccount established for a series of Gen- eral Revenue Sonds concerning Prepaid Net Revenues or Collateral Proceeds sha11 be withdrawn and used only for the purpose of purchasing, paying, prepay- ing, redeeming or discharging General Revenue Bonds or interest or premium thereon (A) of such series in the case of Prepaid Net Revenues and (B) of any series of General Revenue Bonds in the case of Collateial Proceeds; provided, however, that Pre- paid Net Revenues and Collateral Proceeds �hall be withdrawn to the extent required for the purposes for which other funds in the Common Reserve Account may be otherwise withdrawn, but only after exhaus- tion of the Debt Service Account and Administrative Fee Account and other funds in the Common Reserve Account other than in subaccounts for Prepaid Net Revenues, Collateral Proceeds or Retained Funds (and not including Exempt Earnings) (as the fore- going funds and accounts are determined before any � transfers pursuant to Section 404(a) hereof for the specific purpose for which withdrawal is required). 4 - 6 � (ii) (A) Any funds required hereunder to be deposited in or credited to any subaccount for Retained Funds established for a series of General Revenue Bonds shall be withdrawn and used when and in the manner as such funds are required to be applied and credited against payments due under the Revenue Agreement related to such series of bonds in accordance with the terms of such agreement; provided, however, that such funds may be used for the purpose of purchasing, redeeming or discharging General Revenue Bonds of the series to wh�ch such funds relate to the extent the Authority expressly determines that such use will not materially ad- versely affect the future cash requirements of the Authority; and (B) provided further; that such funds shall be withdrawn to the extent required for the purposes for which other funds in the Common Reserve ACCOUnt may be otherwise withdrawn, hut only after exhaustion of the Debt Service Account and Administrative Fee Account and other funds in the Common Reserve Account other than in subac- counts for Prepaid Net Revenues, Collateral Pro- ceeds or Retained Funds (as the foregoing funds and accounts are determined before any transfers � pursuant to Section 404{a) hereof for the specific purpose for which withdrawal is required). Re- tained Funds credited against Net Revenues other- wise due under a Revenue Agreement shall, to the extent available therefor, be transferred to the Debt Service Account as and when so credited. (iii) Notwithstanding any other provision hereof, upon discharge of any series of General Revenue Bonds, funds in any subaccount for such bonds concerning Prepaid Net Revenues, Collateral Proceeds or Retained Funds shall thereupon be re- leased to the Common Reserve Account generally or appropriate subaccounts therein as determined in the sole discretion of the Authority, except as such funds may be transferred in order to effect such a discharge and except as any such funds may be owing to the applicable Contacting Party under the terms of the applicable Revenue Agreement. Except as aforestated or otherwise provided in the applicable Supplemental Bond Resolution or Revenue Agreement, amounts in subaccounts for Prepaid Net Revenues, Collateral Proceeds or Retained Funds may be so withdrawn in any order of priority selected by the Authority among such accounts. Any applica- � tion of or withdrawal �f Prepaid Net Revenues, Collateral Proceeds or Retainad Funds shall be credited, if at all, against Net Revenues or other 4 - 7 � � � sums otherwise due in the manner and to the extent provided in any applicable Supplemental Resolution or Revenue Agreement. (e) A�ministrative Fee Account. In addition ta any withdrawals pursuant to Section 404(c) hereof, funds held in the Administrative Fee Account shall be with- drawn only for the purposes for which funds in the Debt Service Account may be withdrawn, but only after exhaus- tion of the Debt Service Account (as dekermined before any transfers thereto pursuant to Section 404(a) hereof for the specific purpose £or which such withdrawal is required); provided that to the extent any amounts de- posited in the Administrative Fee Account are not with- drawn for the foregoing purposes during the calendar month of such deposit, such amounts shall be promptly thereafter transferred to the General Account in the General Reserve. Section 404. Transfers of Funds and Accountinq Pro- cedures. (a) Payment and Restoration of Deficiency. If at any time funds in the Common Bond Fund are not suffi- cient to pay the principal or Redemption Price of and interest on any General Revenue Bonds of any series when due or to maintain funds in the Common Reserve Account sufficient to meet the Common Reserve Requirement, amounts in the IDB Account (to the extent available) sufficient to make such payment and maintain or restore such subaccounts in the Common Reserve Account at or to such levels sha11 be forthwith transferxed, first to the Debt Service Account to the extent necessary for such payments, and then to the Common Reserve A�count and the appropriate subaccounts therein. If any transfers pur- suant to this paragraph to the Common Reserve Account are not sufficient to fully restore or maintain all such subaccounts in the Common Reserve Account at or to the foregoing levels, amounts so transferred shall be allo- cated to such subaccounts in the inverse order of prior- ity in which funds were withdrawn pursuant to Sections 403(c)(ii) and 403(d). The subaccounts in the Common Reserve Account shall be fully restored from amounts, i£ any, available therefor from time to time in the Deb� Service Account, IDB Account or earnings (other than Exempt Earnings or Retained Earnings) on amounts in other accounts or subaccounts in the Common Bond Fund. Promptly following any withdrawal from the IDB Account in accordance hezewith, the Trustee shall give written notice thereof to the Authotity. � � {b) Available Surplus Determination. Promptly following the end of each calendar year the Authority shall determine the "Available Surplus," if any, from such year. Notwithstanding any other provision herein, the Authority in its sole discretion may elect a differ- ent meihod to determine "Available Surplus" and amounts appropriate or not appropriate to transfer pursuant to Section 4D4(c) hereof based on procedures deeme� by the Authority to be more appropriately related than the foregoing procedure to the Authority's receipt of Net Revenues in comparison of payments requzred to be made from the Common Bond Fund; provided that such method shall not reduce the amounts retained in the Common Bond Fund below the amounts which would have been retained under the method expr�ssly provided herein. (c) Available Surplus Transfer. bromptly follow- ing a determination of the Available Surplus from a year pursuant to Section 404(b) hereof; provided that such method sha11 not reduce the amounts retained in the Common Bond Fund below the amounts which would have been retained under the method expressly provided herein, such Available Surplus shall be transferred to the IDB Account to the extent the Common Reserve Account is not � reduced below the Common Reserve Requirement determined as of such date (or the amounts in any Common Reserve Account subaccounts reduced below the levels upon which the Common Reserve Requirement is determined as of such �ate). Section 405. Construction Fund. Forthwith upon the Bond Closing for any series of General Revenue Bonds the proceeds of such series of General Revenue Bonds (less any accrued interest and any other amounts paid into the Common Bond Fund as provided in Section 311 hereof), togett�er with any other funds permitted to be deposited therein pursuant to the applicable Supplemental Bond Resolution, shall be deposited in a separate Construction Fund for such series of General Revenue Bonds established in accordance with Section 311 hereof. Except as otherwise provided in the applicable Supplemental Bond Resolution or Revenue Agreement, earnings on amounts in such Construction Fund shall be credited thereto. Section 4D6. Deposit of Funds with Trustee and Payinq Aqent and Payinq Aqent Fees. (a) On or prior to any date of payment for princ=- pal or Redemption Price of or premium on any General � Revenue Bonds Outst_anding, the Authority shall rause to be transferred to the Trustee from the Common Bond Fund amounts required for such payment in accordance herewith � � when due, and the Trustee in turn shall disburse such amounts or transfer such amounts to the appropriate Paying Agent(s) for such Qayment when due. The Trustee and any Paying Agent shall hold in trust for the Holders of such General Revenue Bonds and of any interest cou- pons a�purtenant thereto all sums so transferred to the Trustee and any Paying Agent, respectively, until paid to such Holders or otherwise disposed of as herein pro- vided. (b} The Authority shall pay any Paying Agent fees from amounts available in the General Account of the General Reserve or from any other funds of the Authority as the Authority so directs unless otherwise provided in the applicable Supplemental Bond Resolution. Section 407. Priority of Payment. All General Revenue Bonds shall be equally and ratably secured by and payable from the Common Bond Fund, without priority of one such General Revenue Bond over any other; provided that nothing herein shall preclude the Authority from using in accordance herewith Prepaid Net Revenues, Collateral Proceeds or Re- tained Funds to puxchase, prepay ot discharge anq General Revenue Bonds that the Authority in its sole discretion shall determine appropriate. In the event that the balance � in the Common Bond Fund is at any time insufficient to pay all principal or Redemption Price of and interest then due on General Revenue Bonds, the Authority shall apply the balance first to pay pro rata the interest then due on all such General Revenue Bonds, and the Authority shall apply any rema�.ning balance first to the pro rata payment of prin- cipal of the then matured (but unaccelerated) General Reve- nue Bonds and then to the payment of principal due on Gen- eral Revenue Bonds and other i�ems payable from the Common Bond Fund. � 4 - 10 � ARTICLE V INVESTiNENTS Section 501. Investments by Authority. All sums held in the funds or accounts established hereunder, to the extent practicable and permitted by the Act, will be depos- ited as received with a bank or banks duly designated and qualified as a depository of funds oE the Authority and shall be guaranteed by the pledge of securities of the types authorized by law, in value at all times equal to one hun- dted ten percent (110$) of such deposits not guaranteed by Federal Deposit Insurance. Amounts in the Common Bond Fund and each Construction Fund may be invested as permitted by applicable law in accounts or securities maturing before the times and in the amounts estimated to be required to pay expenses from the applicable Construction Fund and principal or Redemption Price and interest when due. Nothing herein shall prevent the combining of funds in bank deposit ac- counts or in investment accounts, to the extent determined by the Authority or Trustee to be necessary or desirable; provided, however, that accurate racords shall be kept at all times showing the proportion of the income from invest- ments properly attributable �o each fund and account, and � such income sha11 be credited on th� books of the Authority or Trustee to the fund or account from which the investment was made. Except as may be otherwise provided herein (or in any Supplemental Bond Resolution concerning funds related to the specific Facility financed thereunder or the construc- tion of such Facility), all earnings on amounts credited to any fund, account or subaccount established pursuant hereto or pursuant to the applicable Supplemental Bond Resolution shall be credited when received to such fund, account or subaccount, as the case may be. � Section 502. Return on Investments. Except in respect of any General Revenue Bonds not issued for the purpose of bearing interest exempt from federal income taxation, (aJ the Authority will rot use or permit the use of the proceeds of the General Revenue Honds to be issued which sha11 cause such obligations to be arbitrage bonds within the meaning of Section 103(c) of the Internal Revenue Code of 1954, as amended (the "Code"), and any applicable and valid regula- tions irom time to time promulgated thereunder; and (b) the Authority will comply with the requirements of Section 103(c) of the Code and such applicable regulations pertain- ing thereto while any General Revenue Bonds remair, Outstand- i ng . 5 - 1 � � � ARTICLE VI DISCHARGE OF OBLIGATIONS TO HOLDERS Section 601. Payment of General Reaenue Bonds. Subject to Sections 602 and 603 hereof, the Autnority may discharge General Revenue Bonds under this Section 601 and interest due on any date by depositing with the Trustee or any escrow agent selected by the Trustee a sum sufficient for the pay- ment thereof in full; and if any Ge�eral Revenue Bond or interest thereon should not be paid when due, the same may nevertheless be discharged by depositing with the Trustee or any escrow agent selected by the Trustee a sum sufficient for the payment thereof in full with interest accrued from the due date to the day of such deposit. When General Reve- nue Bonds of any series or portion of a series and any coupons appurtenant thereto have been discharged as provided in this Article, a11 pledges, covenants and other rights granted hereby shall cease as to the Holders of such series or portion of a series of General Revenue Bonds, such Gen- eral Revenue Bonds shall no longer be considered Outstanding under this Basic Resolution, and the lien herein created upon any Net Revenues and other sums derived from any Facil- ity financed by such series of General Revenue Bonds and any and a11 covenants made heiein with respect to the related Facility may be terminated with respect to the Holders of all Outstanding General Revenue Bonds; provided that nothing herein shall be construed as relievin9 the related Contract- ing Party with respect to the Facility financed by such series of General Revenue Bonds from its obligation under the Revenue Agreement relating to the Facility to continue to pay the full amount of all payments due under the appli- cable Revenue Agreement, nor as entitling the Contracting Party to a reduction in the amount payable for purchase of the Facility or for termination of the Revenue Agreement; and provided further that notwithstanding discharge of any General Revenue Bonds under this Basic Resolution, with respect to the applicable Contracting Party for the purposes of the applicable Revenue Agree�ent, all such General Reve- nue Bonds whose maturity (or mandatory redemption) dates have not expized shall continue to be deemed Outstanding unless the Contracting Party, with the consent of the Au- thority, has provided for the discharge of the General Rev- enue Bonds. Section 602. Prepayment of General Revenue Bonds. The Authority may discharge any prepayable General Revenue Bonds of any series which are called for redemption on anp date when they are prepayable according to their terms by depos- iting with the Trustee �or an escrow agent selected by the Trustee), who shall disburse or shall transfer tu the appro- C:� � priate Paying Agent for disbursement on or before that date, a sum sufficient for the payment of the principal or Redemp- tion Price thereof in full, including payment of interest thereon; provided that notice of the redemption thereof has been duly made in accoxdance with the terms of the Supple- mental Bond Resolution authorizing such series of General Revenue Bonds. Section 603. Deposit for ➢ischarqe. The Authority may discharge General Revenue Bonds of any series Outstanding at any time, when authorized by law, by irrevocably depositing in escrow with a suitable banking institution, as defined in Minnesota Statutes, Section 475.67, a sum of cash and se- curities in such aggregate face amount bearing interest at such rates and maturing or callable at the option of the Holders thereof on such dates as shall be required to pay all principal or Redemption Price of and interest due on such series of General Revenue Bonds to their stated matu- rity {or mandatory redemption) dates or any earlier date upon which they may be redeemed prior to maturity (or manda- tory redemption) in accordance with their terms; provided that notice of any such redemption shall have been duly given in accordance with the terms of the General Revenue Bonds of that series and the Supplemental Bond Resolution pursuant to which such series was authorized. The secur- � ities to be so deposited shall be limited to securities permitted under Mznnesota Statutes, Section 475.67, Sub- division 8, and anp laws amendatory thereof or supplemental thereto but shall not otherwise be limited by the provisions hereof. Section 604. Use of Deposited Funds. Any moneys or securities which at any time shall be deposited by or on behalf of the Authority with the Trustee or any Paying Agent, escrow agent or any other banking institution for the purpose of paying and discharging any General Revenue Bonds of any series and any coupons appurtenant tnereto shall be held in trust for the respective Holders of such General Revenue Bonds and coupons and are hereby irrevocably appro- priated for such payment and discharge. Section 605. Unclaimed Moneys. Notwithstanding any other provision hereof, any moneys held by the Trustee (ot escrow agent selected by the Trustee) or any Paying Agent for the payment and discharge of any General Revenue Bond or any coupon appurtenant thereto which remains unclaimed after the date when that General Revenue Bond or coupon has become due and payable or which remains unclaimed after the date of deposit of moneys for the payment and discharge of a General � Revenue Bond or coLpon not paid when due, for a period of five (5) years after such due date or deposit date, shall be free from such trust and shall promptly thereafter be trans- 6 - 2 � ferred to the Authority by such Trustee, escrow agent or Paying Agent, if applicable, and the Trustee, such escrow agent or such Paying Agent shall be released and discharged with respect thereto, and the Holders of General Revenue Bonds and coupons payable from any such moneys shall look only to the Authority for the payment theteof. � � Section 606. Cancellation of Surrendered General Reve- nue Bonds and Coupons. The Authority may at any time sur- render to the Trustee for cancellation by the Trustee any General Revenue Bonds previously authenticated and delivered hereunder, together with any unpaid coupons thereto belong- ing, which the Authority acquired in any manner whatsoever, and such General Revenue Bonds and any coupons appurtenant thereto, upon such surrender and cancellation, sha11 be deemed to be paid and retired. 6 - 3 � � � ARTICLE VII THE TRUSTEE AND THE PAYING AGENT Section 701. Trustee. ( ), is hereby appointed as Trustee, and the rights, powers and duties of the Trustee hereunder and under the applicable Supplemental Bond Resolution are hereby vested in said Trustee or such successor in trust for the Holders. The Trustee sha11 signify its acceptance of the duties and obli- gations imposed upon it as Trustee hereby and by the appli- cable Supplemental Bond Resolution by such form of written acceptance which is satisfactory to the Authority and Bond Counsel. The Authority may appoint a successor Trustee pursuant to Section 709 hereof. In the event the Authority appoints a successor Trustee, such successor shall execute and deliver to the Authority a written acceptance of the office of Trustee, whereupon such successor shall signify its acceptance of the duties and obligations imposed upon it as Trustee hereby and by the applicable Supplemental Bond Resolution with respeCt to all General Revenue Bonds there- tofore or thereafter to be issued pursuant hereto, but only upon the terms and conditions set forth herein and in the applicable Supplemental Bond Resolution. When required by the law of any jurisdiction or in the reasonable judgment of the Trustee, to enable the Trustee to perform the duties and functions and exercise the powers and rights hereunder or under any Supplemental Bond Resolution on the its behalf as Trustee or on behalf of the Holders, the Trustee may appoint an additional individual or institu- tion or additional individuals or institutions, acceptable to the Authority, as a separate trustee or co-trustee or both, and if and when the Trustee makes any such appointment or appointments, each and every remedy, power, right, claim, demand, cause of action and immunity expressed or intended hereby or by any Supplemental Bond Resolution (other than appointment of an additional or successor trustee or co- trustee heieunder) to be exercised by or vested in or con- veyed to the Trustee with respect thereto shall be exerci- sable by and vest in such separate trustee or co-trustee to exercise such powers, rights and remedies under applicable law, and every covenant and obligation necessary to the exercise thereof by such separate trustee or co-trustee shall run to and be enforceable by either of them. Every such separate trustee or co-trustee shall execute and de- liver to the Authority written acceptance thereof in form and substance acceptable to the Authority; and should any deed, conveyance or instrument in writing from the Authority or the Trustee be required by the separate trustee or co- trustee so appointed for more fully and certainly vesting in 7 - 1 � and confirming to such separate trustee or co-trustee such rights, powers, trusts, remedies, duties and obligations, any and all such conveyances and instruments in writing shall, on request, be executed, acknowledged and delivered by the Authority or the Trustee. � � Section 702. Payinq Aqents. The Authority may appoint by resolution one or more Paying Agents for the General Revenue Bonds of each series, which appointment shall be specified in the applicable Supplemental Bond Resolution adopted prior to the execution, authentication by said Paying Agent and delivery of said series of General Revenue Bonds; and the Authority may, thereafter, at any time or from time to time by resolution, appoint one or more addi- tional Paying Agents or one or more successor Paying Agents for any series of General Revenue Bonds. Each Paying Agent shall be a bank, trust company or national banking associa- tion having trust powers and having a capital and surplus aggregating at least ten million dollars ($10,000,000), if there be such a bank or trust company or national banking association willing and able to accept the office of Paying Agent on reasonable and customary terms and authorized by law to perform a11 the duties imposed upon said Paying Agent hereby and by the applicable Supplemental Bond Resolution. Each Paying Agent shall signify its acceptance of the duties and obligations imposed on each Paying Agent hereby and by the applicable Supplemental Bond Resolution by executing and delivering to the Authority and the Trustee written accep- tance thereof. The Trustee may act as Paying Agent. Section 703. Responsibilities of Trustee and Payinq Aqent• (a) General. The recitals contained herein and in the General Revenue Bonds shall be taken as the state- ments of the Authority, and neither the Trustee nor any Paying Agent shall assume any responsibility for or shall have any liability in respect of the correctness of the same. Neither the Trustee nor the Paying Agent shall be under any responsibility or lia6ility or duty with respect to the issuance of any General Revenue Bonds for value, the use or application of the proceeds thereof (except the Trustee to the extent such proceeds are paid to the Trustee in its capacity as Trustee) or the application of any moneys paid to the Authori*yo ur to those other than the Trustee or the Paying Agent in accordance herewith and with the applicable Supplemental Bond Resolution. Neither the Trustee nor any Paying Agent shall be under any responsibility or liability or duty with respect to the application of any mcneys to any other successor or to any separate or co-trustee or additional Paying Agent. Notwithstanding the foregoing, 7 - 2 � any Paying Agent sha11 be responsible for its represen° tation contained in the certificate of authentication on the General Revenue Bonds. (b) Other Immunities, Duties and Powers of the Trustee. The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder, either directly or by or through agents, attorneys or other persons not regularly in the Trustee's employ. The Trustee may in all cases pay reasona6le compensation to a11 such agents, attorneys and other persons and sha11 be reimbursed or such compensation shall be paid in accordance with the provisions of the applicable Revenue Agreement. The Trustee shall be responsible for the recording or re-recording, registration or re-registration or filing or re-filing of any financing, continuation or similar statements or other instruments of further assurance, with respect hereto, to any Supplemental Bond Resolution and to any security documents in connection therewith. The permissive right of the Trustee to do things enumerated herein shall not be construed as a duty, and � the Trustee shall not be liable £or any action taken, suffered or omitked by the Trustee in good faith without neg�igence and reasonably believed by the Trustee to be within the discretion or power conferred upon the Trustee hereby. The Trustee shall be under no liability for in- terest upon any uninvested moneys that the Trustee may at any time hold in trust or receive under any of the provisions hereof or of anp Supplemental Bond Resolu- tion, except such as the Trustee may agree in writing with the Authority or a Contracting Party, as the case may be, to pay thereon. Section 704. Funds Held in Trust. All moneys held by the Trustee and any Paying Agent at any time pursuant to the terms hereof and of the applicable Supplemental Bond Resolu- tion shall be and hereby are assigned, transferred and set over unto the Trustee or the Paying Agent, as the case may be, in trust for the purposes and under the terms and con- ditions hereof and of the applicable Supplemental Bond Reso- lution. Section 705. Evidence on Which Trustee and Payinq Aqent � Mav Act. The Trustee and any Paying Agent sha11 be pro- tected in acting upon any notice, resolution, request, con- sent, order, certificate, opinion, General Revenue Bond, 7 - 3 � � � coupon, requisition, voucher, invoice or other paper or document believed by it to be genuine and to have been signed or presented by the proper person or persons. The Trustee may consult with Bond Counsel, and the writ- ten advice of Bond Counsel or an Opinion of Bond Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by the Trustee hereunder in good faith and in accordance therewith. Whenever the Trustee sha11 deem it necessary or desirable that a fact or matter be proved or established prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by any certificate required or permitted to be filed with the Trustee under the provisions hereof and of the applicable Supplemental Bond Resolution or the applicable Revenue Agreement stating the same, and such certificate �hall be full warrant for any action taken, suffered or omitted to be taken in good faith under the provisions hereof and of the applicable Supplemental Bond Resoiution upon the faith thereof, but in its discretion, the Trustee may, in lieu thereof (but shall have no obligation to), accept other evidence of such fact or matter or may require such further or additional evidence as the Trustee may deem reasonable. Except as otherwise expressly provided herein, any request, order, notice or other direction required or permitted to be furnished pursuant to any provision hereof, any Supplemental Bond Resolution or any Revenue Agreement by or on behalf of the Authority or any Contracting Party to the Trustee shall be sufficiently evidenced if executed by an authorized representative of the Authority or an o£ficer or other authorized representative of a Contracting Party and any resolution of the governing body of the Authority or duly authorized action of the Contracting Party sha11 be suffi- ciently evidenced to the Trustee by a copy thereof certified by the Secretary or Executive Director of the Authority or any duly authorized officer or party of the Contracting Party. Each Paying Agent shall be protected in acting upon and shall act upon the written request, order, notice or other direction of the Authority pursuant hereto and putsuant to and in accordance with the provisions of the applicable Supplemental Sond R2solution. Section 706. Certain Permitted Acts. The Trustee and the Paying Agent may become the owner of or may deal in General Revenue Bonds and any coupor.s appurtenant thereto as fu11y and with the same rights the Trustee or the Paying Agent would have if it were not �he 'Irastee or Paying Agent, 7 - 4 � respectively. To the extent permitted by law, the Trustee and the Paying Agent may act as depository for and permit any of their respective officers or directors to act as a member of or in any other capacity with respect to any com- mittee formed to protect the rights of the Holders of Gen- eral Revenue Bonds or to effect or aid in any reorganization growing out of the enforcement of the General Revenue Bonds or any coupons appurtenant thereto, this Basic Resolution and any Supplemental Bond Resolutian, whether or not any such commmittee shall represent the Holders of at least a ma7ority in aggregate principal amount of the General Reve� nue Bonds Outstanding. Section 707. Resiqnation of Trustee or Payinq Aqent. The Trustee, the Paying Agent or any successors thereto may at any time resign and be discharged of its duties and obli- gations created hereby and by any Supplemental Bond Resolu- tion by giving not less than forty-five (45) days' written notice to the Authority (to the Authority and the Trustee, if the Paying Agent shall resign and the Paying Agent be other than the Trustee) and by publishing notice thereof, specifying the date when such resignation shall take effect, in an Authorized Newspaper within twenty (20) days after the giving of such written notice, if any coupon General Revenue Bonds not registered as to principal or registered as to � principal to bearer are Outstanding, and by mailing a notice to the foregoing effect to Holders of registered General Revenue Bonds and Holders of coupon General Revenue Bonds registered as to principal other than to bearer. Such reaignation shall take effect upon the date specified in such written notice to the Authority or the Authority and the Trustee, a� the case may be, unless a successor shall have been appointed prior to said date, in which event such resignation shall take effect immediately on the appointment of such successor and assumption by such successor in writ- ing all of the duties and obligations of its predecessor. Section 708. Removal. The Trustee appointed hereby, or any successor Trustee subsequent thereto may be removed at any time by resolution of the Authority or by the Holders of at least a majority in aggregate principal amount of all General Reven�e Bonds then Outstanding, by an instrument or concurrent instruments in writing signed and duly acknow- ledged by such Holders or by their attorneys duly au�horized in writing and delivered to the Authority. Copies of each such resolution or instrument shall be delivered by the Authority to the Trustee. The Paying Agent or any successor Paying Agent may be � removed at any time by resolution of the Authority. Copies of such written action shall be delivered to the Trustee and to such Paying Agent and any successor Paying Agent. 7 - 5 � Section 709. Appointment of Successar Trustee. In the event that at any time the Trustee or any successor Trustee shall resign or shall be removed or shall be unable or un- willinq to act as Trustee or shall be adjudged a bankrupt or insolvent or if a receiver, liquidator or conservator of the Trustee or such successor Trustee or of its property shall be appointed or ii any public officer shall take chatge or control of the Trustee or such successor Trustee or of its property or affairs, the Authority shall by resolution forthwith appoint a successor Trustee. The successor to the Trustee appointed hereby and each and every successor there- after, shall be a bank, trust company or national banking association having trust powers and having a capital and surplus aggregating at least fifty million dollars ($S�,QOO,�QOj, if there be such a bank or trust company �r national banking association willing and able to accept the office of Trustee hereunder on reasonable and customary terms and authorized by law to perform all the duties im- posed upon such successor Trustee hereunder and under the �pplicable Supplemental Bond Resolution. The Authority shall publish notice of any such appointment of a successor Trustee or mail notice thereof in accordance with the provi- sions of Section 707 hereof. � The Holders of at least a majority in aggregate princi- pal amount of all General Revenue $onds then Outstanding may, by an instrument or concurrent instruments in writing signed by such Holders or their attorneys duly authorize�d in writing and delivered to such successor Trustee appointed by the Authority, with notification thereof to the Authority and the predecessor Trustee, appoint a successor Trustee to supersede said successor Trustee so appointed by the Author- ity, in such event, any successor Trustee appointed by the Authority shall, immediately and without further act, be superseded by a successor Trustee appointed by the requisite percentage of Holders in the aforementioned manner, but only if such successor has the requisite capital and surplus as determined herein. If no appointment of a successor Trustee shall be made pursuant to the foregoing provisions of this Section 709 within forty-five (45) days after the Trustee shall have given written notice to the Authority as provided in Section 707 hereof or after the occurrence of any other event re- quiring or authori2ing such appointment, the Trustee or any other separate trustee or co-trustee or any Holder may apply to any court of competent jurisdiction to appoint a suc- cessor Trustee. Said court may thereupon, after such no- tice, if any, as said court may deem proper and prescribe, � aPPo�nt such successor Trustee. 7 - 6 � Section 710. Transfer of Riqhts to Successor. Any successor to the Trustee appointed hereby which is hereafter appointed hereunder and any successor Trustee thereafter appointed shall execute, acknowledge and deliver to its predecessor Trustee and also to the Authority an instrument accepting such appointment, and thereupon such successor Trustee, without any further act or conveyance, shall become fully vested with all moneys, estates, rights, powers, duties and obligations of such predecessor Trustee, with like effect as if named herein as such Trustee, but the Trustee ceasinq to act shall, nevertheless, on the written request of the Authority or of the successor Trustee, exe- cute, acknowledge and delivet such instruments of conveyance and further assurance and do such other things as may rea- sonably be reguired for more fully and certainly vesting in and confirming to such successor Trustee a11 rights, powers, duties and obligations of the predecessor Trustee hereunder and in and to the Common Bond Fund and the IDB Account. Should any conveyance or instrument in writing from the Authority be required by such successor Trustee for more fully and certainly vesting in and confirming to such suc- cessor Trustee any such rights, powers, duties and obliga- tions, any and a11 such conveyances and instruments in writ- ing shall, on request and so far as may be authorized by � law, be executed, acknowledged and delivered by the Author- ity. Any such successor Trustee shall promptly notify any other separate trustee or co-trustee and any Paying Agent of its appointment as such successor Trustee. Any successor Paying Agent appointed by the Authority as provided for in this Basic Resolution shall execute, acknow- ledge and deliver to its predecessor Paying Agent and also to the Trustee and any separate trustee or co-trustee and the Authority an instrument accepting sucn appointment, and thereupon, such successor Paying Agent, without any further act, deed or conveyance, shall become fully vested with a11 rights, powers, duties and obligations of such predecessor Paying Agent, with like effect as if named in the applicable Supplemental Bond Resolution as such Paying Agent. The Paying Agent ceasing to act as Paying Agent shall, on the written request of the Authority, *_he Trustee and the suc- cessor Paying Agent, execute, acknowledge and deliver such instruments of conveyance and further assurance and do such other things as may reasonably be required by the Authority for more fu11y and certainly vesting in and confirming to such successor Paying Agent all rights, powers, duties and obligations of the predecessor Paying Agent. Section 711. Merqer or Consolidation. Any company into � which the Trustee or any Paying Agent may be merged or con- verted or with whicn the Trust=e or any Paying Agent may be consolidated or any company resulting from any merger, con- 7 - 7 � version or consolidation to which the Trustee or any Paying Agent shall be a party or any company to which the Trustee or any Paying Aqent may sell or transfer all or substan- tially all of its corporate trust business, provided such company shall be a bank or trust company or national banking association which is qualified to be a successor Trustee under Section 709 hereof or a successor 1'aying Agent under Section 702 hereof, as the case may be, and shall be autho- rized by law to perform all the duties imposed upon it hereby and by the applicable Supplemental Bond Resolution, shall be the successor to the Trustee or Paying Acent, as the case may be, without the execution or filing of any paper or the performance of any further act. � � ►�3 LJ � � ARTICLE VIII AMENDMENT OF BASIC RESOLUTION Section 801. Amendments Not Requirinq Consent. The Authority reserves the right to amend this Basic Resolution at any time for the purpose of curing any ambiguity or formal defect or omission herein or in any amending or Sup- plemental Bond Resolution, to modify the accounting pro- cedures heiein and order of source of payment in respect of Bonds from accounts and subaccounts in the Common Bond Fund, to grant for the benefit of the Holders of General Revenue Bonds any additional rights, remedies, powers, authoritp or security that may lawfully be granted or to make any other change which is not to the prejudice of any Holders of Gen- eral Revenue Bonds. The Authority covenants and agrees with the Holders of General Revenue Bonds issued hereunder and secured hereby that it will not amend this Basic Resolution in any other manner except upon consent of the Holders as hereinafter provided. Nothing herein sha11 limit the power of the Authority to authorize the issuance of General Reve- nue Bonds by Supplemental Bond Resolution without Holder consent in accordance with the terms and conditions of Section 202. Section 302. Amendments with Holders' Consent. The Holders of not less than fifty-one percent (51�) in aggre- gate principal amount of General Revenue Bonds which are at any time Outstanding and not discharged shall have the right to consent to and approve the amendment of this Basic Reso- lution (excluding any Supplemental Bond Resolution authoriz- ing the issuance of General Revenue Bonds) by the Authority, for the purpose of authorizing any modification, alteration, amendment or rescission of or any addition to this Basic Resolution, except that nothing herein shall permit a reduc- tion in the aggregate principal amount of the General Reve- nue Bonds required for consent to any such amendment nor an extension of the maturity (or mandatory redemption) date of the principal of or the interest on any General Revenue Bond not held by a consenting Holder, nor grant a privilege or priority to any General Revenue Bond over any other General Revenue Bond not provided for herein. Any written consent to such an amendment may be embodied in and evidenced by one or any numbei of concurrent written instruments of substan- tially similar tenor signed by such Holders in person or by an agent duly appointed in writing, and such consent shall become effective when such instrument or instruments are delivered to the Trustee. Section 803. Proof of Consent. Proaf of the execution of any consent or of a writing appointing any agent or of � � the holding by any person of General Revenue Bonds which are transferable by delivery shall be sufficient for any purpose (including those for which Holders have a voice under Sec- tions 312, 708, 709 and 802 hereof) and shall be conclusive in favor of the Authority or the Trustee, as the case may be, if made in the following manner: The fact and date of the execution by any person of any such consent may be proved by the affidavit of any witness o£ such execution or by the certificate of any notary public or other officer authorized by law to take acknowledgments of deeds, certify- ing that the person signing such consent acknowledged to him the execution thereof. The amount of General Revenue Bonds transferable by delivery held by any person executing any such consent as a Holder and the distinguishing numbers of such General Revenue Bonds and the date of his holding the same may be proved by a certificate executed by any trust company, bank or other depository, whetever situated, if such certificate shall be deemed satisfactory by the Author- ity, showing that at the date therein mentioned such person had on deposit with such depasitory or exhibited to it the General Revenue Bonds therein described; or such facts may be proved by the certificate or affidavit of the person exe- cuting such consent as a Holder, if such certificate or affidavit shall be deemed satisfactory by the Authority. � The Authority may conclusively assume that such ownership continues until written notice to the contrary is served upon it. The fact and date of execution of any such consent and the amount and distinguishing numbers of General Revenue Bonds held by the person executing the same may also be proved in any other manner which the Authority may deem sufficient; but the Authority may nevertheless, in its sole discretion, require further proof in cases where it deems further proof desirable. Any consent by the Holder of any General Revenue Bond shall bind any future Holder of the same General Revenue Bond with respect to any amendment adopted by the Authority pursuant to such consent. Section 804. Notice of Amendment. Before adopting any amendment hereto which requires the consent of the Holders of Outstanding General Revenue Bonds, the Authority will file a copy of the proposed amendment in its office and at the office of the Trustee or the Paying Agent at which sucn General Revenue Bonds are payable and will mail a notice to all owners of such General Revenue Bonds then Outstandinq who shall have filed their names and addresses with the Authority and will cause such notice to be published in a financial journal of general circulation in the State. Such notice shall briefly state the nature of the proposed amend- ment and that a copy is on file at the office of the Author- � ity for inspection by all Holders. No such amendment shall be adopted unless consent is received from the required per- centage of Holders within six (6) months after such pub- lication. � � Section 805. Amendment of Supplemental Bond Resolu- tion. In addition to the purposes set forth in Section 801, the Authority may amend any Supplemental Bond Resolution au- thorizing the issuance of General Revenue Bonds for any purpose, in any manner and sub;ect to any conditions set forth in the Supplemental Bond Resolution; provided that no such amendment may be inconsistent with the terms and condi- tions of this Basic Resolution. � il_ J � r'- �--- ARTICLE IX MISCELLANEOUS Section 901. Severability. If any provision of this 8asic Resolution shall be held or deemed to be or sha11, in fact, be inoperative or unenforceable as applied in any particular case in any jurisdiction or �urisdictions ot in all jurisdictions or in all cases because it conflicts with any provisions of any constitution or statute or rule of public policy or for any other reason, such circumstances shall not have the effect of rendering the provision in question inoperative or unenforceable in any other case or circumstance or of rendering any othet provision or pro- visions herein contained invalid, inoperative or unenforce- able to any extent whatsoever. The invalidity of any one or more phrases, sentences, clauses or paragraphs contained in the Basic Resolution shall not affect the remaining portions of the Basic Resolution or any part thereof. Section 902. Limitation of Liability. To the extent permitted by law and consistent with covenants made with the Holders of any series of General Revenue Bonds, no provi- � sion, covenant or agreement contained in the Basic Resolu- tion shall give rise to or impose any pecuniary liability upon the Authority or any of its officers, employees or agents. � Section 903. Table of Contents and Headinqs. The Table of Contents and headings herein are for convenience only and shall not affect the construction hereof. Section 904. Minnesota Law to Govern. The Basic Reso- lution is delivered in and shall be governed by and con- strued in accordance with the laws of the State of Minne- sota. Section 905. Basic Resolution to Govern. Unless the express language or the ciear context of a provision in any Supplemental Bond Resolution or Revenue Agreement clearly requires to the contrary, all provisions of such Supple- mental Bond Resolution or Revenue Agreement shall be inter- preted to apply in a manner not inconsistent herewith, and 9 - 1 � in case any such provision is inconsistent herewith, the provisions herein sha11 govern and control. °ASSED AND A�OPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRI�LEY THIS 21ST DAY OF JULY, 1983. � i � ��'-�� /` /� ��' ti'iLL�`GC ti "_z'.,��y�...c�r� �AWRENCE R. C6MMERS, CHAIRMAN ATTEST: � JE OLD L. BOARDhTAN ECUTIVE DIRECTOR � � t '