EXHIBIT 28(a)
CERTAIN RIGHTS OF THE LESSOR UNDER THIS FACILITY
LEASE HAVE BEEN ASSIGNED TO, AND ARE SUBJECT TO A SECURITY INTEREST IN
FAVOR OF, CHEMICAL BANK, AS INDENTURE TRUSTEE UNDER A TRUST INDENTURE,
MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF RENTS DATED AS OF
DECEMBER 16, 1985. THIS FACILITY LEASE HAS BEEN EXECUTED IN SEVERAL
COUNTERPARTS. SEE SECTION 22(e) OF THIS FACILITY LEASE FOR INFORMATION
CONCERNING THE RIGHTS OF HOLDERS OF VARIOUS COUNTERPARTS HEREOF.
THIS COUNTERPART IS NOT THE ORIGINAL
COUNTERPART.
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FACILITY LEASE
dated as of December 16, 1985
between
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity, but solely as Owner
Trustee under a Trust Agreement, dated as of
December 16, 1985, with Burnham Leasing
Corporation,
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
================================================================================
Sale and Leaseback of an Undivided Interest in
Palo Verde Nuclear Generating Station Unit 1
and Certain Common Facilities
================================================================================
6091.20.2898.47:1
TABLE OF CONTENTS
Page
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SECTION 1 Definitions . . . . . . . . . . 1
SECTION 2 Lease of Undivided
Interest; Term; Personal
Property. . . . . . . . . . . . 1
a Lease of Undivided
Interest. . . . . . . . . . . . 1
b Term. . . . . . . . . . . . . . 2
c Personal Property . . . . . . . 2
SECTION 3 Rent; Adjustments to
Rent. . . . . . . . . . . . . . 2
a Basic Rent. . . . . . . . . . . 2
b Supplemental Rent . . . . . . . 3
c Form of Payment . . . . . . . . 4
d Adjustments to Rent . . . . . . 4
e Further Adjustments . . . . . . 5
f Computation of
Adjustments . . . . . . . . . . 5
g Sufficiency of Basic
Rent and Supplemental
Rent. . . . . . . . . . . . . . 6
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TABLE OF CONTENTS (Continued)
Page
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h Rent Differential . . . . . . . 6
SECTION 4 Net Lease . . . . . . . . . . . 7
SECTION 5 Return of the Undivided
Interest. . . . . . . . . . . . 9
a Return of the Undivided
Interest. . . . . . . . . . . . 9
b Disposition Services. . . . . . 11
SECTION 6 Warranty of the Lessor. . . . . 11
a Quiet Enjoyment . . . . . . . . 11
b Disclaimer of Other
Warranties. . . . . . . . . . . 11
c Enforcement of Certain
Warranties. . . . . . . . . . . 12
SECTION 7 Liens . . . . . . . . . . . . . 13
SECTION 8 Operation and Mainten-
ance; Capital Improve-
ments . . . . . . . . . . . . . 13
a Operation and
Maintenance . . . . . . . . . . 13
b Inspection. . . . . . . . . . . 14
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TABLE OF CONTENTS (Continued)
Page
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c Capital Improvements. . . . . . 14
d Reports . . . . . . . . . . . . 15
e Title to Capital
Improvements. . . . . . . . . . 16
f Funding of the Cost of
Capital Improvements. . . . . . 17
g Useful Life . . . . . . . . . . 19
SECTION 9 Event Of Loss; Deemed
Loss Event. . . . . . . . . . . 19
a Damage or Loss. . . . . . . . . 19
b Repair. . . . . . . . . . . . . 19
c Payment of Casualty
Value . . . . . . . . . . . . . 20
d Payment of Special
Casualty Value. . . . . . . . . 21
e Requisition of Use. . . . . . . 21
f Termination of
Obligation. . . . . . . . . . . 22
g Application of Payments
of an Event of Loss . . . . . . 22
6091.20.2898.47:1
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TABLE OF CONTENTS (Continued)
Page
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h Application of Payments
Not Relating to an Event
of Loss . . . . . . . . . . . . 23
i Other Dispositions. . . . . . . 23
j Assumption of Notes;
Creation of Lien on
Undivided Interest. . . . . . . 23
SECTION 10 Insurance . . . . . . . . . . . 24
a Required Insurance. . . . . . . 24
b Permitted Insurance . . . . . . 25
SECTION 11 Rights to Assign or
Sublease. . . . . . . . . . . . 25
a Assignment or Sublease
by the Lessee . . . . . . . . . 25
b Assignment by Lessor as
Security for Lessor's
Obligations . . . . . . . . . . 25
SECTION 12 Lease Renewal . . . . . . . . . 26
SECTION 13 Notices for Renewal or
Purchase; Purchase
Options . . . . . . . . . . . . 26
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TABLE OF CONTENTS (Continued)
Page
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a Notice; Determination of
Values; Appraisal
Procedure . . . . . . . . . . . 26
b Purchase Option at
Expiration of the Lease
Term. . . . . . . . . . . . . . 27
c Special Purchase Option . . . . 27
d Purchase of the
Undivided Interest;
Payment, Etc. . . . . . . . . . 27
SECTION 14 Termination for
Obsolescence. . . . . . . . . . 28
a Termination Notice. . . . . . . 28
b Right of Lessor to
Retain Undivided
Interest upon
Termination . . . . . . . . . . 28
c Events on the
Termination Date. . . . . . . . 29
d Early Termination
Notice. . . . . . . . . . . . . 30
e Events on the Early
Termination Date. . . . . . . . 30
6091.20.2898.47:1
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TABLE OF CONTENTS (Continued)
Page
SECTION 15 Events of Default . . . . . . . 31
SECTION 16 Remedies. . . . . . . . . . . . 35
a Remedies. . . . . . . . . . . . 35
b No Release. . . . . . . . . . . 40
c Remedies Cumulative . . . . . . 40
d Exercise of Other Rights
or Remedies . . . . . . . . . . 41
e Special Cure Right of
Lessee. . . . . . . . . . . . . 41
SECTION 17 Notices . . . . . . . . . . . . 42
SECTION 18 Successors and Assigns. . . . . 42
SECTION 19 Right to Perform for
Lessee. . . . . . . . . . . . . 43
SECTION 20 Additional Covenants. . . . . . 43
SECTION 21 Lease of Real Property
Interest. . . . . . . . . . . . 44
SECTION 22 Amendments and
Miscellaneous . . . . . . . . . 44
6091.20.2898.47:1
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TABLE OF CONTENTS (Continued)
Page
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a Amendments in Writing . . . . . 44
b Survival. . . . . . . . . . . . 44
c Severability of
Provisions. . . . . . . . . . . 45
d True Lease. . . . . . . . . . . 45
e Original Lease. . . . . . . . . 45
f Governing Law . . . . . . . . . 46
g Headings. . . . . . . . . . . . 46
h Concerning the Owner
Trustee . . . . . . . . . . . . 46
i Disclosure. . . . . . . . . . . 47
j Counterpart Execution . . . . . 47
APPENDIX A Definitions
SCHEDULE 1 Owner Participant Information
SCHEDULE 2 Basic Rent Percentages
SCHEDULE 3 Casualty Values
SCHEDULE 4 Special Casualty Values
SCHEDULE 5 Termination Values
6091.20.2898.47:1
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FACILITY LEASE
FACILITY LEASE, dated as of December 16, 1985, between THE
FIRST NATIONAL BANK OF BOSTON, a national banking association, not in its
individual capacity, but solely as Owner Trustee under a Trust Agreement, dated
as of December 16, 1985, with Burnham Leasing Corporation (the Lessor), and
PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico, corporation (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessor owns the Undivided Interest and the Real
Property Interest;
WHEREAS, the Lessee desires to lease the Undivided Interest
and the Real Property Interest from the Lessor on the terms and conditions set
forth herein; and
WHEREAS, the Lessor is willing to lease the Undivided Interest
and the Real Property Interest to the Lessee on the terms and conditions set
forth herein;
NOW THEREFORE, in consideration of the premises and of other
good and valuable consideration, receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein shall have
the meanings assigned to such terms in Appendix A and Schedule 1 hereto.
References in this Facility Lease to sections, paragraphs and clauses are to
sections, paragraphs and clauses in this Facility Lease unless otherwise
indicated.
SECTION 2. Lease of Undivided Interest; Term; Personal
Property.
(a) Lease of Undivided Interest. Upon the terms and subject to
the conditions of this Facility Lease, the Lessor hereby agrees to lease to the
Lessee, and the Lessee hereby agrees to lease from the Lessor, the Undivided
Interest.
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(b) Term. The term of this Facility Lease shall begin on the
Closing Date and shall end on the last day of the Lease Term.
(c) Personal Property. It is the express intention of the
Lessor and the Lessee that title to the Undivided Interest and every portion
thereof is severed, and shall be and remain severed, from title to the real
estate constituting the Real Property Interest and the PANGS Site. The Lessor
and the Lessee intend that the Undivided Interest shall constitute personal
property to the maximum extent permitted by Applicable Law.
SECTION 3. Rent; Adjustments to Rent.
(a) Basic Rent. The Lessee shall pay to the Lessor, as basic
rent (herein referred to as Basic Rent) for the Undivided Interest, the
following amounts:
(i) on January 15, 1986, an amount equal to the daily
equivalent of Basic Rent (set forth in Schedule 1) payable
pursuant to clause (ii) below, from and including December 31,
1985 to but excluding January 15, 1986 plus or minus the Rent
Differential, if any, referred to in Section 3(h);
(ii) on July 15, 1986 and on each Basic Rent payment
Date thereafter to and including January 15, 2015, an amount
equal to the percentage of facility Cost set forth opposite
such Basic Rent Payment Date on Schedule 2 plus or minus the
Rent Differential, if any, referred to in Section 3(h); and
(iii) if the Lessee shall elect the Renewal Term, on
July 15, 2015 and on each Basic Rent Payment Date thereafter
during the Renewal Term, an amount equal to one-half of an
amount determined by dividing the amount of all payments of
Basic Rent payable with respect to the Basic Lease Term
pursuant to clause (ii) of this Section 3(a) (taking into
account any adjustments pursuant to Sections 3(d) and 3(e) and
any increases and decreases pursuant to Section 3(h)), by 58.
If an interest payment on the Initial Series Note (and the Releveraging Note, if
then outstanding) shall be due on a date other than a Basic Rent Payment Date,
the Lessee shall pay additional Basic Rent on such date equal to such interest
6091.20.2898.47:1
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payment and such payment of additional Basic Rent shall be credited against the
Basic Rent due on the Basic Rent Payment Date next succeeding the date that such
additional Basic Rent shall have been paid.
(b) Supplemental Rent. The Lessee shall pay the following
amounts (herein referred to as Supplemental Rent):
(i) when due or, where no due date is specified, on
demand, any amount (other than Basic Rent, Casualty Value,
Termination Value and Special Casualty Value) which the Lessee
assumes the obligation to pay or agrees to pay to the Lessor,
the Owner Participant, the Indenture Trustee, the Collateral
Trust Trustee or any Indemnitee under this Facility Lease, any
other Transaction Document or the Collateral Trust Indenture
and any amount which the Lessor is obligated to pay under
Section 6.9, 7.6 or 8.7 of the Indenture;
(ii) when due any amount payable hereunder as
Casualty Value, Termination Value or Special Casualty Value,
and any premium or prepayment penalty with respect to the
Notes;
(iii) on demand and in any event on the Basic Rent
Payment Date next succeeding the date such amounts shall be
due and payable hereunder, to the extent permitted by
Applicable Law, interest (computed on the same basis as
interest on the Notes is computed) at a rate per annum equal
to (A) the Overdue Interest Rate, on that portion of the
payment of Basic Rent or Supplemental Rent distributable
pursuant to clause "first" of Section 5.1 or clause "second"
of Section 5.3 of the Indenture (determined prior to the
computation of interest on overdue payments referred to in
such clauses), and (B) the Penalty Rate, on the balance of any
such payment of Basic Rent or Supplemental Rent (including, in
the case of both clause (i) and clause (ii) above, but without
limitation, to the extent permitted by Applicable Law,
interest payable pursuant to this clause (iii)) not paid when
due (without regard to any period of grace) for any period for
which the same shall be overdue.
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The Lessor shall have all rights, powers and remedies provided for in this
Facility Lease, at law, in equity orotherwise, in the case of non-payment of
Basic Rent or Supplemental Rent.
(c) Form of Payment. Subject to Section 11(b), each payment of
Rent under this Facility Lease shall be made in immediately available funds no
later than 11:00 a.m., local time at the place of receipt, on the date each such
payment shall be due and payable hereunder and shall be paid either (A) in the
case of payments other than Expected Payments, to the Lessor at its address
determined in accordance with Section 17, or at such other address as the Lessor
may direct by notice in writing to the Lessee, or (B) in the case of Excepted
Payments, to such Person as shall be entitled to receive such payment at such
address as such Person may direct by notice in writing to the Lessee. If the
date on which any payment of Rent is due hereunder shall not be a Business Day,
the payment otherwise due thereon shall be due and payable on the preceding
Business Day, with the same force and effect as if paid on the normal date
provided in this Facility Lease.
(d) Adjustments to Rent. Basic Rent and the schedules of
Casualty Values, Termination Values and Special Casualty Values attached hereto
shall be adjusted (upward or downward) to preserve Net Economic Return if there
is any change in the Code or successor legislation enacted by the Ninety-ninth
Congress or if there is adopted, promulgated, issued or published, prior to
January 15, 1997, proposed, temporary or final regulations resulting therefrom
(regardless of the effective date of such regulations) herein referred to as a
Change in Tax Law). Adjustments under this paragraph (d) shall be (1) made not
more than once a year and (2) limited in the aggregate to the extent, if any,
necessary such that aggregate amount of Basic Rent theretofore and thereafter
payable throughout the Basic Lease Term (computed for such purpose only without
regard to any adjustments theretofore made pursuant to Section 3(e) or 3(h)
shall not be more than 11% upward and 10% downward from the aggregate amount of
Basic Rent payable throughout the Basic Lease Term (computed as aforesaid) prior
to any adjustment theretofore made pursuant to this Section 3(d); provided,
however, that no downward adjustment shall be made hereunder unless and until
the aggregate amount of all such downward adjustments shall exceed 1% and then
only to the extent such aggregate exceeds 1% (resulting in a maximum downward
adjustment of 10%). The foregoing 11% maximum, 10% minimum and 1% "deadband"
limitations were determined on the basis of an assumed interest rate on the
Notes set forth in Schedule 1 hereunto and are subject to adjustment in
6091.20.2898.47:1
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connection with any refunding of the Initial Series Note to provide the same
protection to the Owner Participant and the Lessee as provided in the original
calculations thereof by the Owner Participant.
The provisions of this Section 3(d) to the contrary
notwithstanding, if any Change in Tax Law is, or becomes, applicable to the
transaction contemplated by this Facility Lease in consequence of the transfer
of the Owner Participant's beneficial interest in the Trust (whether or not
permitted by Section 15 of the Participation Agreement) or if such Change in Tax
Law would not have been applicable to such transaction had no such transfer
occurred, then no adjustment shall be, or be required to be, made pursuant to
this paragraph (d); provided, however, that this sentence shall not apply to the
initial transfer of the Owner Participants's beneficial interest to one of its
Affiliates.
(e) Further Adjustments. Basic Rent and the schedules of
Casualty Values, Special Casualty Values and Termination Values attached hereto
shall be adjusted (upward or downward) to preserve Net Economic Return if there
is (i) issuance of the Releveraging Note or the Fixed Rate Note, (ii) any
Supplemental Financing, (iii) the payment of Transaction Expenses in an amount
which is other than 1.1% of the Purchase Price or (iv) any change in the pricing
assumptions set forth in Schedule 2 to the Participation Agreement.
(f) Computation of Adjustments. Upon the occurrence of an
event requiring an adjustment to Basic Rent payable pursuant to clause (ii) of
Section 3(a), and the schedules of Casualty Values, Special Casualty Values and
Termination Values attached hereto, pursuant to paragraph (d) or (e) of this
Section 3, the Owner Participant shall make the necessary computations and
furnish to the Lessee, the Loan Participant, the Lessor and the Indenture
Trustee the revised amounts and percentages, which amounts and percentages shall
be implemented upon delivery thereof and effective as of the date of occurrence
of the event requiring such adjustment (taking into account any payment of Basic
Rent already made) and shall remain effective until changed in consequence of
any verification procedure set forth below. Such revised amounts and percentages
shall be subject to verification (at the Lessee's request) by the Owner
Participant's nationally recognized independent public accountants, in which
case such accountants shall either (i) confirm to the Lessee in writing that
such revised amounts were computed on a basis consistent with the original
6091.20.2898.47:1
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calculations, or (ii) compute and provide to the Lessee, the Lessor, the Owner
Participant, the Loan Participant and the Indenture Trustee revised amounts and
percentages which are on such a basis. The revised amounts and percentages, as
so confirmed or computed if applicable, shall be conclusive and binding upon the
Lessee, the Lessor, the Owner Participant, the Loan Participant and the
Indenture Trustee. The cost of any such verification shall be borne by the
Lessee unless such accountants shall require an adjustment to the revised
amounts and percentages originally provided by the Owner Participant which
greater than 10% of the adjustment so provided, in which case such cost shall be
divided and paid by the Lessee and the Owner Participant in equal amounts. Each
adjustment pursuant to paragraph (d) or (e) of this Section 3 may, but need not,
be evidenced by the execution and delivery of a supplement to this Facility
Lease in form and substance satisfactory to the Lessee and the Owner
Participant, but shall be effective as provided herein without regard to the
date on which such implement to this Facility Lease is so executed and
delivered. Any adjustment referred to in this Section 3 shall satisfy the
provisions of Revenue Procedure 75-21, Revenue Procedure 75-28 and any other
applicable statute, regulation, revenue procedure, revenue ruling or technical
information release relating to the subject matter of Revenue Procedure 75-21 or
Revenue Procedure 75-28, but, in the case of any upward adjustment, shall be no
less than the adjustment otherwise required pursuant to this Section 3.
(g) Sufficiency of Basic Rent and Supplemental Rent.
Notwithstanding any other provision of this Facility Lease, any other
Transaction Document or any Financing Document, (i) the amount of Basic Rent
payable on each Basic Rent Payment Date shall be at least equal to the aggregate
amount of principal, premium, if any, and accrued interest payable on al Notes
then Outstanding and (ii) each payment of Casualty Value, Special Casualty Value
and Termination Value shall in no event be less (when added to all other amounts
required to be paid by the Lessee under this Facility Lease in respect of any
Event of Loss or Deemed Loss Event or termination of this Facility Lease) than
an amount sufficient, as of the date of payment, to pay in full the principal
of, and premium, if any, and interest on all Notes Outstanding on and as of such
date of payment (taking into account any assumption of the Notes by the Lessee).
(h) Rent Differential. So long as the Initial Series Note
shall be outstanding, each installment of Basic Rent shall be increased or
decreased, as the case may be, by the Rent Differential. For purposes hereof,
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Rent Differential shall mean, as of any Basic Rent Payment Date, the difference
between (i) the aggregate amount of interest due and payable on each Basic Rent
Payment Date on the Initial Series Note (and the Releveraging Note, if then
outstanding), and (ii) the aggregate amount of interest that would have been due
and payable on such Basic Rent Payment Date on such Note or Notes if such Note
or Notes had at all times during the relevant period borne interest at a rate
equal to 9.5% per annum (computed on the basis of a 360-day year of twelve
30-day months). If, as of any Basic Rent Payment Date, (A) the amount determined
in accordance with clause (i) of the immediately preceding sentence shall be
greater than the amount determined in accordance with clause (ii) of such
sentence, the amount of Basic Rent due on such Basic Rent Payment Date shall be
increased by the Rent Differential, and (B) the amount determined in accordance
with such clause (ii) shall exceed the amount determined in accordance with such
clause (i), the amount of Basic Rent due on such Basic Rent Payment Date shall
be decreased by the Rent Differential.
SECTION 4. Net Lease.
This Facility Lease (as originally executed and as modified,
supplemented and amended from time to time) is a net lease and the Lessee hereby
acknowledges and agrees that the Lessee's obligation to pay all Rent hereunder,
and the rights of the Lessor in and to such Rent, shall be absolute,
unconditional and irrevocable and shall not be affected by any circumstances of
any character, including, without limitation, (i) any set-off, abatement,
counterclaim, suspension, recoupment, reduction, defense or other right or claim
which the Lessee may have against the Lessor, the Owner Participant, the
Indenture Trustee, the Collateral Trust Trustee, the Loan Participant, the
Operating Agent, any ANPP Participant, any vendor or manufacturer of any
equipment or assets included in the Undivided Interest, Unit 1, any Capital
Improvement, the Real Property Interest, the PANGS Site, PANGS, or any part of
any thereof, or any other Person for any reason whatsoever, (ii) any defect in
or failure of the title merchantability, condition, design, compliance with
specifications, operation or fitness for use of all or any part of the Undivided
Interest, Unit 1, any Capital Improvement, the Real Property Interest, the PANGS
Site or PANGS, (iii) any damage to, or removal, abandonment, shutdown, salvage,
scrapping, requisition, taking, loss, theft or destruction of all or any part of
the Undivided Interest, Unit 1, any Capital Improvement, the Real Property
6091.20.2898.47:1
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Interest, the PANGS Site or PANGS, or any interference, interruption or
cessation in the use or possession thereof or of the Undivided Interest by the
Lessee or by any other Person (including, but without limitation, the Operating
Agent or any other ANPP Participant) for any reason whatsoever or of whatever
duration, (iv) any restriction, prevention or curtailment of or interference
with any use of all or any part of the Undivided Interest, Unit 1, any Capital
Improvement, the Real Property Interest, the PANGS Site or PANGS, (v) any
insolvency, bankruptcy, reorganization or similar proceeding by or against the
Lessee, the Lessor, the Owner Participant, the Indenture Trustee, the Collateral
Trust Trustee, the Loan Participant, the Operating Agent, any other ANPP
Participant or any other Person, (vi) the invalidity, illegality or
unenforceabilty of this Facility Lease, any other Transaction Document, any
Financing Document, the ANPP Participation Agreement or any other instrument
referred to herein or therein or any other infirmity herein or therein or any
lack of right, power or authority of the Lessor, the Lessee, the Owner
Participant, the Indenture Trustee, the Collateral Trust Trustee, the Loan
Participant or any other Person to enter into this Facility Lease, any other
Transaction Document or any Financing Document, or any doctrine of force
majeure, impossibility, frustration, failure of consideration, or any similar
legal or equitable doctrine that the Lessee's obligation to pay Rent is excused
because the Lessee has not received or will not receive the benefit for which
the Lessee bargained, it being the intent of the Lessee to assume all risks from
all causes whatsoever that the Lessee does not receive such benefit, (vii) the
breach or failure of any warranty or representation made in this Facility Lease
or any other Transaction Document or any Financing Document by the Lessor, the
Owner Participant, the Indenture Trustee, the Collateral Trust Trustee, the Loan
Participant or any other Person, (viii) any amendment or other change of, or any
assignment of rights under, this Facility Lease, any other Transaction Document,
any Financing Document or any ANPP Project Agreement, or any waiver, action or
inaction under or in respect of this Facility Lease, any other Transaction
Document, any Financing Document or any ANPP Project Agreement, or any exercise
or non-exercise of any right or remedy under this Facility Lease, any other
Transaction Document, any Financing Document or any ANPP Project Agreement,
including, without limitation, the exercise of any foreclosure or other remedy
under the Indenture, the Collateral Trust Indenture or this Facility Lease, or
the sale of Unit 1, any Capital Improvement, the Undivided Interest, the Real
Property Interest, the PANGS Site or PANGS, or any part thereof of any interest
6091.20.2898.47:1
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therein, or (ix) any other circumstance or happening whatsoever whether or not
similar to any of the foregoing. The Lessee acknowledges that by conveying the
leasehold estate created by this Facility Lease to the Lessee and by putting the
Lessee in possession of the Undivided Interest and the Real Property Interest,
the Lessor has performed all of the Lessor's obligations under and in respect of
this Facility Lease, except the covenant that the Lessor and Persons acting for
the Lessor will not interfere with the Lessee's quiet enjoyment of the Undivided
Interest and the Real Property Interest. The Lessee hereby waives, to the extent
permitted by Applicable Law, any and all rights which it may now have or which
at any time hereafter may be conferred upon it, by statute or otherwise, to
terminate, cancel, quit or surrender this Facility Lease or to effect or claim
any diminution or reduction of Rent payable by the Lessee hereunder, including
without limitation the provisions of Arizona Revised Statutes Section 33-343,
except in accordance with the express terms hereof. If for any reason whatsoever
this Facility Lease shall be terminate in whole or in part by operation of law
or otherwise, except as specifically provided herein, the Lessee nonetheless
agrees to pay to the Lessor or other Person entitled thereto an amount equal to
each installment of Basic Rent and all Supplemental Rent at the time such
payment would have become due and payable in accordance with the terms hereof
had this Facility Lease not been terminated in whole or in part. Each payment of
Rent made by the Lessee hereunder shall be final and the Lessee shall not seek
or have any right to recover all or any part of such payment from the Lessor or
any other Person for any reason whatsoever. All covenants, agreements and
undertakings of the Lessee herein shall be performed at its cost, expense and
risk unless expressly otherwise stated. Nothing in this Section 4 shall be
construed as a guaranty by the Lessee of any residual value in the Undivided
Interest or as a guaranty of the Notes. Any provisions of Section 7(b) (2) or
8(c) of the Participation Agreement to the contrary notwithstanding, if the
Lessee shall fail to make any payment of Rent to any Person when and as due
(taking into account applicable grace periods), such Person shall have the right
at all times, to the exclusion of the ANPP Participants, to demand, collect, sue
for, enforce obligations relating to and otherwise obtain all amounts due in
respect of such Rent.
SECTION 5. Return of the Undivided Interest.
(a) Return of the Undivided Interest. On the Lease Termination
Date, the Lessee will surrender possession of the Undivided Interest and the
Real
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Real Property Interest to the Lessor. At the time of such return the Lessee
shall pay or have paid all amounts due and payable, or to become due and
payable, by it as an ANPP Participant under each and every ANPP Project
Agreement allocable or chargeable (whether or not payable during or after the
Lease Term) to the Undivided Interest or the Real Property Interest in respect
of any period or periods ending on or prior to the Lease Termination Date
(including, but without limitation, all amounts payable with respect to any and
all discretionary Capital Improvements to Unit 1 or the PANGS Site approved or
authorized (without the concurrence of the Owner Participant) within the 3-year
period preceding the end of the Lease Term, whether or not implementation
thereof has been completed on or prior to the Lease Termination Date), and the
Undivided Interest shall be free and clear of all Liens (other than Permitted
Liens described in clauses (i), (v) (other than those arising by, through or
under the Lessee alone), (vi), (vii) (other than as aforesaid), (viii) (other
than as aforesaid), (ix) and (x) of the definition of such term) and in the
condition and state of repair by Section 8. The Lessor shall not abandon the
Undivided the Undivided Interest. In the event that on or prior to the Lease
Termination Date there shall have occurred a default by any ANPP Participant
(other than PNM) under the ANPP Participation Agreement and such default shall
not have been cured by the defaulting ANPP Participant, then (i) the Lessee
agrees to indemnify and hold the Lessor (and each successor, assign and
transferee thereof) harmless against and all obligations under the ANPP
Participation Agreement with respect to contributions or payments required to be
made thereby as a result of such default and (ii) the Lessor (and each
successor, assign and transferee thereof) agrees to reimburse the Lessee for all
amounts paid by the Lessee pursuant to the foregoing clause (i) to the extent,
but only to the extent, that the Lessor (or such successor, assign or
transferee) shall have actually received proceeds from the sale of the
Generation Entitlement Share of the defaulting ANPP Participant as a result of
the payment made by the Lessee pursuant to the foregoing clause (i), and, to the
extent the Lessor (or such successor, assign or transferee) shall have received
such proceeds, the amount to be reimbursed to the Lessee pursuant to this clause
(ii) shall include interest at the Prime Rate from the date of any payment by
the Lessee pursuant to the foregoing clause (i) through the date of
reimbursement of such amount pursuant to this clause (ii).
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(b) Disposition Services. The Lessee agrees that if it does
not exercise its option to renew or purchase as provided in Sections 12 and 13,
respectively, then during the last thirty-six months of the Lease Term, the
Lessee will fully cooperate with the Lessor in connection with the Lessor's
efforts to lease or dispose of the Undivided Interest including using the
Lessee's reasonable efforts to lease or dispose of the Undivided Interest. The
Lessor agrees to reimburse the Lessee for reasonable out-of-pocket costs and
expenses of the Lessee incurred at the request of the Lessor or the Owner
Participant in connection with such cooperation and such efforts.
SECTION 6. Warranty of the Lessor.
(a) Quiet Enjoyment. The Lessor warrants that until the Lease
Termination Date, if the Lessee is in compliance with each and every term and
provision of this Facility Lease and each other Transaction Document to be
compiled with by the Lessee, the Lessee's use and possession of Unit 1,
including the Undivided Interest, shall not be interrupted by the Lessor or any
Person claiming by, through or under the Lessor, and their respective successors
and assigns.
(b) Disclaimer of Other Warranties. The warranty set forth in
Section 6(a) is in the lieu of all other warranties of the Lessor or the Owner
Participant, whether written, oral or implied, with respect to this Facility
Lease, Unit 1, any Capital Improvement, the Undivided Interest, PANGS, the Real
Property Interest or the PANGS Site. As among the Owner Participant, the Loan
Participant, the Indenture Trustee, the Collateral Trust Trustee, the Lessor and
the Lessee, execution by the Lessee of this Facility Lease shall be conclusive
proof of the compliance of Unit 1 (including any Capital Improvement), the
Undivided Interest and the Real Property Interest with all requirements of this
Facility Lease, and the Lessee acknowledges and agrees that (i) NEITHER THE
LESSOR NOR THE OWNER PARTICIPANT IS A MANUFACTURER OR A DEALER IN PROPERTY OF
SUCH KIND AND (ii) THE LESSOR LEASES AND THE LESSEE TAKES THE UNDIVIDED INTEREST
AND THE REAL PROPERTY INTEREST, AND SHALL TAKE EACH CAPITAL IMPROVEMENT, AND ANY
PART THEREOF, AS IS AND WHERE IS, and neither the Lessor nor the Owner
Participant shall be deemed to have made, and THE LESSOR AND THE OWNER
PARTICIPANT EACH HEREBY DISCLAIMS, ANY OTHER REPRESENTATION OR WARRANTY, EITHER
EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION,
THE DESIGN OR CONDITION OF UNIT 1, ANY CAPITAL IMPROVEMENT, THE UNDIVIDED
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INTEREST, THE REAL PROPERTY INTEREST, THE PANGS SITE OR PANGS, OR ANY PART
THEREOF, THE MERCHANTABILITY THEREOF OR THE FITNESS THEREOF FOR ANY PARTICULAR
PURPOSE, TITLE TO UNIT 1, ANY CAPITAL IMPROVEMENT, THE UNDIVIDED INTEREST, THE
REAL PROPERTY INTEREST, THE PANGS SITE OR PANGS, OR ANY PART THEREOF, THE
QUALITY OF THE MATERIAL OR WORKMANSHIP THEREOF OR CONFORMITY THEREOF TO
SPECIFICATIONS, FREEDOM FROM PATENT OR TRADEMARK INFRINGEMENT OR THE ABSENCE OF
ANY LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, NOR SHALL THE LESSOR
OR THE OWNER PARTICIPANT BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES
(INCLUDING LIABILITY IN TORT, STRICT OR OTHERWISE), it being agreed that all
such risks, as among the Owner Participant, the Loan Participant, the Collateral
Trust Trustee, the Indenture Trustee, the Lessor and the Lessee, are to be borne
by the Lessee. The provisions of this Section 6(b) have been negotiated, and,
except to the extent otherwise expressly provided in Section 6(a), the foregoing
provisions are intended to be a complete exclusion and negation of any
representations or warranties by the Lessor, the Owner Participant, the Loan
Participant, the Collateral Trust Trustee or the Indenture Trustee, express or
implied, with respect to Unit 1 (including any Capital Improvement), the
Undivided Interest, PANGS, the Real Property Interest or the PANGS Site that may
arise pursuant to any law now or hereafter in effect, or otherwise.
(c) Enforcement of Certain Warranties. The Lessor authorizes
the Lessee (directly or through agents, including the Operating Agent), at the
Lessee's expense, to assert for the Lessor's account, during the Lease Term, all
of the Lessor's rights (if any) under any applicable warranty and any other
claims (under this Facility Lease or any Purchase Document) that the Lessee or
the Lessor may have against any vendor or manufacturer with respect to Unit 1
(including any Capital Improvement) or the Undivided Interest, and the Lessor
agrees to cooperate, at the Lessee's expense, with the Lessee and the Operating
Agent in asserting such rights. Any amount receivable (without regard to any
right of setoff or other similar right of any Person against the Lessee) by the
Lessee as payment under any such warranty or other claim against any vendor or
manufacturer (or, if such warranty or claim relates to the Undivided Interest
and the Retained Assets, the portion of such received amount appropriately
allocable to the Undivided Interest) shall be applied in accordance with
Sections 9(g), (h) and (i).
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SECTION 7. Liens.
The Lessee will not directly or indirectly create, incur,
assume or permit to exist any Lien on or with respect to the Undivided Interest,
the Real Property Interest, the Lessor's title thereto or any interest of the
Lessor or Lessee therein (and the Lessee will promptly, at its own expense, take
such action as may be necessary duly to discharge any such Lien), except
Permitted Liens.
SECTION 8. Operation and Maintenance; Capital Improvements.
(a) Operation and Maintenance. The Lessee agrees that it will
exercise its rights, powers, elections and options as an ANPP Participant under
the ANPP Project Agreements to cause the Operating Agent to (A) maintain Unit 1
in such condition that Unit 1 will have the capacity and functional ability to
perform, on a continuing basis (ordinary wear and tear excepted), in normal
commercial operation, the functions and substantially at the ratings for which
it was designed, (B) operate, service, maintain and repair Unit 1 and replace
all necessary or useful parts and components thereof so that the condition and
operating efficiency will be maintained and preserved, ordinary wear and tear
excepted, in all material respects in accordance with (1) prudent utility
practice for items of similar size and nature, (2) such operating standards as
shall be required to take advantage of an enforce all available warranties and
(3) the terms and conditions if all insurance policies maintained in effect at
any time with respect thereto, (C) use, possess, operate and maintain Unit 1 in
compliance with all material applicable Governmental Actions (including the
License) affecting PANGS or Unit 1 or the use, possession, operation and
maintenance thereof and (D) otherwise act in accordance with the standards set
forth in the ANPP Participation Agreement. The Lessee will comply with all its
obligations under Applicable Law affecting Unit 1, the Undivided Interest,
PANGS, the Real Property Interest and the PANGS Site, and the use, operation and
maintenance thereof. The Lessee agrees to (i) exercise its rights under the ANPP
Participation Agreement so that there will always be an Operating Agent under
the ANPP Participation Agreement and (ii) maintain in full force and effect a
license from the NRC adequate to possess the Undivided Interest and the Real
Property Interest under the circumstances contemplated by the ANPP Participation
Agreement. The Lessee will keep and maintain proper books and records (i)
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relating to all Operating Funds (as defined in the ANPP Participation Agreement)
provided by it to the Operating Agent under the ANPP Participation Agreement and
(ii) upon receipt of the requisite information from the Operating Agent,
relating to the application of such Operating Funds to the operation and
maintenance of Unit 1 and the acquisition, construction and installation of
Capital Improvements, all in accordance with the Uniform System of Accounts. The
Lessor shall not be obliged in any way to maintain, alter, repair, rebuild or
replace Unit 1, any Capital Improvement, the Undivided Interest or the Real
Property Interest, or any part thereof, or, except as provided in Section 8(f),
to pay the cost of alteration, rebuilding, replacement, repair or maintenance of
Unit 1, any Capital Improvement, the Undivided Interest or the Real Property
Interest, or any part thereof, and the Lessee expressly waives the right to
perform any such action at the expense of the Lessor pursuant to any law at any
time in effect.
(b) Inspection. The Lessor, the Owner Participant, the
Indenture Trustee and the Collateral Trust Trustee shall have the right to
inspect PANGS (subject, in each event, to the ANPP Participation Agreement,
Applicable Law, applicable confidentiality undertakings and procedures
established by the Operating Agent) at their expense. The Lessor and the Owner
Participant shall have the right to inspect, at their expense, the books and
records of the Lessee relating to PANGS, and make copies of and extracts
therefrom (subject as aforesaid) and may, at their expense, discuss the Lessee's
affairs, finances and accounts with its executive officers and its independent
public accountants (and by this provision, the Lessee authorizes such
accountants, in the presence of the Lessee, to discuss with the Lessor and the
Owner Participant and their respective authorized representatives the affairs,
finances and accounts of the Lessee), all at such times and as often as may be
reasonably requested. None of the Lessor, the Owner Participant, the Indenture
Trustee and the Collateral Trust Trustee shall have any duty whatsoever to make
any inspection or inquiry referred to in this Section 8(b) and shall not incur
any liability or obligation by reason of not making any such inspection or
inquiry.
(c) Capital Improvements. If and to the extent required by the
ANPP Participation Agreement, the Lessee shall, at its sole expense, promptly
participate in the making of any Capital Improvement to Unit 1. The Undivided
Interest Percentage of the net proceeds of any sale or other disposition of
property removed from Unit 1 receivable (without regard to any right of setoff
6091.20.2898.47:1
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or other similar right of any Person against the Lessee) by or credited to the
account of the Lessee in accordance with the ANPP Participation Agreement and
any insurance proceeds receivable (without regard to any right of setoff or
other similar right of any Person against the Lessee) for the account of the
Lessor or the Lessee in respect of the loss or destruction of, or damage or
casualty to, any such property shall be applied as provided in Section 9(g), (h)
or (i), as the case may be. An undivided interest equal to the Undivided
Interest Percentage in property at any time removed from Unit 1 shall remain the
property of the Lessor, no matter where located, until such time as a Capital
Investment constituting a replacement of such property shall have been installed
in Unit 1 or such removed property has been disposed of by the Operating Agent
in accordance with the ANPP Participation Agreement. Simultaneously with such
disposition by the Operating Agent, title to the Lessor's undivided interest in
the removed property shall vest in the Person designated by the Operating Agent,
free and clear of any and all claims or rights of the Lessor. Unless
subparagraph (3) of Section 8(e) shall be applicable, upon the incorporation of
a Capital Improvement in Unit 1, without further act, (i) title to an undivided
interest equal to the Undivided Interest Percentage in such Capital Improvement
shall vest in the Lessor and (ii) such undivided interest in such Capital
Improvement shall become subject to this Facility Lease and be deemed to be part
of the Undivided Interest for all purposes hereof to the same extent that the
Lessor had an undivided interest in the property originally incorporated or
installed in Unit 1. The Lessee warrants and agrees that the Lessor's interest
in all Capital Improvements shall be free and clear of all Liens, except
Permitted Liens other than the type specified in clauses (ii), (iii) and (xii)
of the definition thereof.
(d) Reports. To the extent permissible, the Lessee shall
prepare and file in timely fashion, or, where the Lessor shall be required to
file, the Lessee shall prepare and deliver to the Lessor within a reasonable
time prior to the date for filing, any reports with respect to Unit 1, the
Undivided Interest or the Real Property Interest or the condition or operation
thereof that shall be required to be filed with any governmental or regulatory
authority. On or before March 1 of each year and on the Lease Termination Date,
the Lessee shall furnish the Lessor and the Owner Participant with a report
stating the total cost of all Capital Improvements and describing separately and
in reasonable detail each Capital Improvement (or related group of Capital
6091.20.2898.47:1
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Improvements) made during the period from the date hereof to December 31, 1986
in the case of the first such report or during the period from the end of the
period covered by the last previous report to the December 31 prior to such
report in the case of subsequent reports. On or before March 1 in each year
(commencing March 1, 1986) and at such other times as the Lessor or the Owner
Participant shall reasonably request in writing (which request shall provide a
reasonable period for response), the Lessee will report in writing to the Lessor
with respect to (i) the most recent annual capital expenditure budget submitted
by the Operating Agent to the Lessee in accordance with the ANPP Participation
Agreement and (ii) the then plans (if any) which the Lessee may have for the
financing of the same under Section 8(f).
(e) Title to Capital Improvements. Title to an undivided
interest, equal to the Undivided Interest Percentage, in each Capital
Improvement to Unit 1 shall vest as follows:
(1) in the case of each Nonseverable Capital Improvement,
whether or not the Lessor shall have financed or provided financing (in whole or
in part) for such undivided interest in such Capital Improvement by an
Additional Equity Investment or a Supplemental Financing, or both, effective on
the date such Capital Improvement shall have been incorporated or installed in
Unit 1, the Lessor shall, without further act, acquire title to such undivided
interest in such Capital Improvement;
(2) in the case of each Severable Capital Improvement, if the
Lessor shall have financed (by an Additional Equity Investment or a Supplemental
Financing, or both) the Undivided Interest Percentage of the cost of such
Capital Improvement, the Lessor shall, without further act, acquire title to
such undivided interest in such Capital Improvement; and
(3) in the case of each Severable Capital Improvement, if the
Lessor shall not have financed (by either an Additional Equity Investment or a
Supplemental Financing, or both) the Undivided Interest Percentage of the cost
of such Capital Improvement, the Lessee shall retain title to such undivided
interest.
6091.20.2898.47:1
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Immediately upon title to such undivided interest in any
Capital Improvement vesting in the Lessor pursuant to sub-paragraph (1) or
sub-paragraph (2) of this Section 8(e), such undivided interest in such Capital
Improvement shall, without further act, become subject to this Facility Lease
and be deemed part of the Undivided Interest and Unit 1 and for all purposes
hereof.
(f) Funding of the Cost of Capital Improvements. Before
placing in service any Capital Improvement to Unit 1 the cost of which exceeds
$100,000,000 in respect of the interests of all ANPP Participants, the Lessee
shall give the Lessor and the Owner Participant reasonable advance notice
thereof. The Owner Participant shall have the option, in its sole discretion, of
financing through the Lessor the cost of any such Capital Improvement, or any
other Capital Improvement presented to the Owner Participation for financing,
including or not including the making of an investment by the Owner Participant
(an Additional Equity Investment) and the issuance of one or more Additional
Notes, all on terms acceptable to the Lessee and the Owner Participant. If the
Owner Participant does not finance, or arrange the financing of, the cost of
such Capital Improvement, the Lessee may cause the Lessor to issue, if and to
the extent permitted by the Indenture, to one or more Persons (other than any
Person affiliated with the Lessee within the meaning of Section 318 of the Code)
one or more Additional Notes and to use the proceeds thereof to pay the cost of
such Capital Improvement, subject to satisfaction of the following conditions:
(i) there shall be no more than one Supplemental Financing in
any calendar year;
(ii) the sum of the Supplemental Financing Amounts in any
calendar year shall equal or exceed the Undivided Interest Percentage of
$5,000,000;
(iii) the Lessee may include in any request for a Supplemental
Financing only Capital Improvements not previously financed in any Supplemental
Financing and which have been installed or affixed no earlier than three
calendar years before the beginning of the calendar year in which such
Supplemental Financing occurs;
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(iv) the total amount of all Supplemental Financing during the
Basic Lease Term shall not exceed the Undivided Interest Percentage of
$100,000,000;
(v) unless waived by the Owner Participant, the Bonds issued and
outstanding under the Collateral Trust Indenture shall be rated no less than
"investment grade", as determined by Standard & Poor's Corporation and Moody's
Investors Service, Inc.;
(vi) the Supplemental Financing Amount shall not exceed that
portion of the cost of Capital Improvements which, when financed, will
constitute an addition to the Owner Participant's basis under section 1012 of
the Code;
(vii) in the opinion of independent tax counsel to the Owner
Participant, such Supplemental Financing shall not result in adverse tax
consequences to the Owner Participant or adversely affect the status of this
Facility Lease as a "true lease" for Federal tax purposes, and the Owner
Participant and the Lessor shall have agreed upon the amount and manner of
payment of any indemnity (if any) payable by the Lessee as a consequence of such
Supplemental Financing;
(viii) the Additional Notes shall have a final maturity date
no later than January 15, 2015;
(if) the Lessee shall have made such representations, warranties
and covenants regarding the tax characteristics of each undivided interest in
each Capital Improvement as the Owner Participant requests and the Tax
Indemnification Agreement shall have been appropriately modified;
(x) appropriate adjustments to Basic Rent and the schedules of
Casualty Values, Special Casualty Values and Termination Values shall have been
agreed to by the Owner Participant;
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(xi) The Lessee shall pay to the Lessor an amount equal to all
out-of-pocket costs and expenses reasonably incurred by the Lessor or the Owner
Participant not financed as a part of such Supplemental Financing or reflected
in adjustments to Basic Rent;
(xii) no Default or Event of Default shall have occurred and
be continuing; and
(xiii) the Lessee shall enter into such agreements and shall
provide such tax indemnities, representations, warranties, covenants, opinions,
certificates and other documents as the Owner Participant shall reasonably
request.
(g) Useful Life. If the Lessee shall not theretofore have
exercised its option under Section 13 to purchase the Undivided Interest and the
Real Property Interest, then (i) if the Lessee shall not theretofore have
exercised its option to renew the Lease pursuant to Section 12, on January 15,
2014, the Lessee shall initiate the Appraisal Procedure to determine the
remaining economic useful life of Unit 1 as of July 15, 2014 and (ii) on the
Rent Payment Date occurring one year prior to the end of the Renewal Term, if
any, the Lessee shall initiate the Appraisal Procedure to determine the
remaining economic useful life of Unit 1 as of the date six months prior to the
end of the Renewal Term. The Lessee and the Lessor agree to use their best
efforts to ensure that such determination of remaining economic useful life is
made no later than July 15, 2014 (in the case of the first such determination)
and six months prior to the end of the Renewal Term (in the case of the second
such determination).
SECTION 9. Event of Loss; Deemed Loss Event.
(a) Damage or Loss. In the event that Section 16.2 of the ANPP
Participation Agreement (as in effect on the date hereof) shall become
applicable, or an Event of Loss, a Requisition of Use or a Requisition of Title
shall occur, or Unit 1 or any substantial part thereof shall suffer destruction,
damage, loss, condemnation, confiscation, theft or seizure for any reason
whatsoever, such fact shall promptly, and in any case within five Business Days
of any such event, be reported by the Lessee to the Lessor and the Owner
Participant.
(b) Repair. The Lessee shall promptly make any and all
payments required of the Lessee under the provisions of the ANPP Participation
Agreement relating to damage or destruction or the like to Unit 1 or any portion
thereof; provided, however, that the Lessee shall
6091.20.2898.47:1
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in no event be obligated to make or join in any agreement under Section 16.2 of
the ANPP Participation Agreement (as in effect on the date hereof) concerning
repairs to or reconstruction of Unit 1.
(c) Payment of Casualty Value. On the Basic Rent Payment Date
next following the occurrence of an Event of Loss, the Lessee shall pay to the
Lessor all Basic Rent due on such Basic Rent Payment Date, plus an amount equal
to the excess of (i) Casualty Value determined as of such Basic Rent Payment
Date, plus an amount equal to the execww of (i) Casualty Value determined as of
such Basic Rent Payment Date over (ii) the unpaid principal amount of the Notes
Outstanding on such date after giving effect to the payment, if any, of the
principal installment due and payable on such date. Upon compliance in full by
the Lessee with the foregoing provisions of this Section 9(c) and assumption by
the Lessee of all the obligations and liabilities of the Owner Trustee under the
Indenture and the Notes pursuant to Section 3.9(b) of the Indenture, the Lessor
shall (so long as no Default or Event of Default shall have occurred and be
continuing), and at any time after the occurrence of an Event of Loss, the
Lessor may:
(1) in the case of an Event of Loss arising from a Final
Shutdown, if the Lessee shall have declined, but one or more of the other ANPP
Participants shall have elected, to reconstruct or restore Unit 1, as permitted
by the ANPP Participation Agreement, Transfer the Undivided Interest and the
Real Property Interest to such electing ANPP Participants, as required by and in
the proportions set forth in the ANPP Participation Agreement, in which case the
Lessee shall be entitled to receive the portion of the "salvage value" purchase
price allocable to the Undivided Interest; or
(2) if clause (1) shall not be applicable, Transfer the
Undivided Interest and the Real Property Interest to the Lessee.
If the Lessee shall not have assumed all the obligations and liabilities of the
Owner Trustee under the Indenture and the Notes in accordance with Section
3.9(b) of the Indenture, but shall have paid all amounts required by this
Section 9(c), the Lessor shall retain the Undivided Interest and the Real
Property Interest subject to the terms of this Facility Lease and Section 7(b)
(4) of the Participation Agreement; provided, however, that (i) the obligation
6091.20.2898.47:1
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of the Lessee to pay further Basic Rent shall be reduced to an amount on each
Basic Rent Payment Date equal to the aggregate amount of the principal, premium,
if any, and accrued interest then payable on all Notes then Outstanding and (ii)
this Facility Lease shall become a security agreement for all purposes of
Applicable Law.
(d) Payment of Special Casualty Value. If a Deemed Loss Event
occurs, the party hereto having knowledge thereof and, at the Lessor's option,
on the day of the month (specified in Schedule 4) next following the month
during which the Deemed Loss Event occurs, the Lessee shall pay to the Lessor on
such day an amount equal to the excess of (i) Special Casualty Value determined
as of the date such payment is due over (ii) the principal amount of the Notes
Outstanding on such date after giving effect to the payment, if any, of the
principal instalment due and payable on such day. Upon compliance in full by the
Lessee with the foregoing provisions of this Section 9(d) and assumption by the
Lessee of all the obligations and liabilities of the Owner Trustee under the
Indenture and the Notes pursuant to Section 3.9(b) of the Indenture, the Lessor
shall (so long as no Default or Event of Default shall have occurred and be
continuing), and at any time after the occurrence of a Deemed Loss Event, the
Lessor may, Transfer the Undivided Interest and the Real Property Interest to
the Lessee. If the Lessee shall not have assumed all the liabilities and
obligations of the Owner Trustee under the Indenture and the Notes in accordance
with Section 3.9(b) of the Indenture but shall have paid all amounts required by
this Section 9(d), the Lessor shall retain the Undivided Interest and the Real
Property Interest subject to the terms of this Facility Lease and Section 7(b)
(4) of the Participation Agreement; provided, however, that (i) the obligation
of the Lessee to pay further Basic Rent shall be reduced to an amount on each
Basic Rent Payment Date equal to the aggregate amount of principal, premium, if
any, and accrued interest then payable on all Notes Outstanding and (ii) this
Facility Lease shall become a security agreement for all purposes of Applicable
Law.
(e) Requisition of Use. In the case of a Requisition of Use
not constituting an Event of Loss, this Facility Lease shall continue, and each
and every obligation of the Lessee hereunder and under each Transaction Document
shall remain in full force and effect. So long as no Default or Event of Default
shall have occurred and be continuing, the Lessee shall be entitled to all sums
received by reason of any such Requisition of Use for the period ending on the
6091.20.2898.47:1
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Lease Termination Date, and the Lessor shall be entitled to all sums received by
reason of any such Requisition of Use for the period after the Lease Termination
Date.
(f) Termination of Obligation. Until the Lessee shall have
made the payments specified in Section 9(c) or 9(d), the Lessee shall make all
payments of Rent when due; and the Lessee shall thereafter be required to make
all payments of Supplemental Rent as and when due. In the event that the Lessee
shall assume all the obligations and liabilities of the Owner Trustee under the
Indenture and the Notes pursuant to Section 3.9(b) of the Indenture, upon
payment by the Lessee of the payments specified in Section 9(c) or 9(d) and all
Rent due and owing through and including the date of payment (including Basic
Rent due on or accrued through such date, as the case may be), the Lease Term
shall end and the Lessee's obligation to pay further Basic Rent shall cease.
(g) Application of Payments on an Event of Loss. Any payments
receivable (without regard to any right of setoff or other similar right of any
Person against the Lessee) at any time by the Lessor or the Lessee (other than
insurance placed by the Owner Trustee or the Owner Participant pursuant to
Section 10(b)) from any governmental authority, insurer or other Person (except
the Lessee) as a result of the occurrence of an Event of Loss shall be applied
as follows:
(i) all such payments received at any time by the Lessee shall
be promptly paid to the Lessor for application pursuant to the following
provisions of this Section 9(g), except that the Lessee may retain any amounts
that would at the time be payable to the Lessee as reimbursement under the
provisions of clause (ii) below;
(ii) so much of such payments as shall not exceed the amount
required to be paid by the Lessee pursuant to Section 9(c) (ignoring, for this
purpose, clause (ii) of the first sentence thereof) shall be applied in
reduction of the Lessee's obligation to pay such amount if not already paid by
the Lessee or, if already paid by the Lessee, shall be applied to reimburse the
Lessee for its payment of such amount; and
(iii) the balance, if any, of such payments remaining
thereafter shall be divided between the Lessor and the Lessee as their interests
may appear.
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(h) Application of Payments Not Relating to an Event of Loss.
Payments receivable (without regard to any right of setoff or other similar
right of any Person against the Lessee) at any time by the Lessor (other than
insurance placed by the Owner Trustee or the Owner Participant pursuant to
Section 10(b)) or the Lessee from any Governmental Authority, insurer or other
Person with respect to any destruction, damage, loss, condemnation,
confiscation, theft or seizure of or Requisition of Title to or Requisition of
Use of Unit 1 or any part thereof not constituting an Event of Loss shall be
applied first to reimburse the Lessee for all amounts expended in respect of the
repair, replacement or reconstruction of Unit 1 or any part thereof as provided
in Section 9(b), and second the balance, if any, of such payments shall be
divided between the Lessor and the Lessee as their interests may appear.
(i) Other Dispositions. Notwithstanding the foregoing
provisions of this Section 9, so long as a Default or Event of Default shall
have occurred and be continuing, any amount that would otherwise be payable to
or for the account of, or that would otherwise be retained by, the Lessee
pursuant to Section 10 or this Section 9 shall be paid to the Lessor as security
for the obligations of the Lessee under this Facility Lease and, at such time
thereafter as no Default or Event of Default shall be continuing, such amount
shall be paid promptly to the Lessee unless this Facility Lease shall have
theretofore been declared to be in default, in which event such amount shall be
disposed of in accordance with the provisions hereof, of the Indenture and of
the Trust Agreement.
(j) Assumption of Notes; Creation of Lien on Undivided
Interest. In connection with an Event of Loss, a Deemed Loss Event or the
exercise of the Cure Option, (i) the Lessee agrees to use its best efforts to
comply with the conditions respecting its assumption of all the obligations and
liabilities of the Owner Trustee under the Indenture and the Notes set forth in
Section 3.9(b) of the Indenture, and (ii) the Lessor agrees that, if the Lessee
fails to assume all the obligations and liabilities of the Owner Trustee under
the Indenture and the Notes in accordance with Section 3.9(b) of the Indenture,
not later than two Business Days prior to the date on which the Lessee is to
acquire the Owner Participant's interest in the Trust Estate pursuant to Section
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7(b) (4) of the Participation Agreement, the Lessor will cause the Undivided
Interest and the Real Property Interest to be subjected to the Lien of the
Indenture by executing and delivering to the Indenture Trustee the Undivided
Interest Indenture Supplement.
SECTION 10. Insurance.
(a) Required Insurance. The Lessee will use its best efforts
to cause the Operating Agent to carry and maintain insurance required under the
ANPP Participation Agreement and will make all payments required of the Lessee
under the ANPP Participation Agreement in respect of such insurance. The Lessee
will at all times maintain, directly or through the Operating Agent, policies of
casualty and liability insurance with respect to the Undivided Interest and the
Real Property Interest in such amounts and with such coverage as shall be
adequate in accordance with prudent utility practice. Any policies of insurance
in respect of destruction, damage, loss, theft or other casualty to the
Undivided Interest, the Real Property Interest, Unit 1 or any part thereof shall
name the Lessor (and, to the extent practicable, the Owner Participant) as
additional insured, as its interests may appear, and any policies with respect
to nuclear liability insurance shall include all Indemnities as additional
insureds; provided, however, that if the Operating Agent, as trustee, shall
become the loss payee under any policy of insurance constituting Project
Insurance, then the Lessor and the Owner Participant shall be and be made
beneficiaries of the trust arrangement under which the Operating Agent acts as
trustee. The Lessee shall, on or before March 1 of each year, commencing March
1, 1986, furnish to the Lessor and the Owner Participant (A) a certificate
signed by an independent insurance broker showing the insurance then maintained
under the ANPP Participation Agreement and hereunder, stating that all premiums
then due have been paid and stating that the insurance then carried and
maintained under the ANPP Participation Agreement and hereunder is in accordance
with the terms of the ANPP Participation Agreement and this Section 10, and (B)
upon the request of the Lessor or the Owner Participant, copies (to the extent
permitted by the issuers of such policies) of policies so maintained. All
insurance proceeds paid in respect of damage, destruction, loss, theft or other
casualty to the Undivided Interest or the Real Property Interest shall be
applied as provided in Section 9(g) (h) or (i), as the case may be.
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(b) Permitted Insurance. Nothing in this Section 10 shall
prohibit the Lessee from placing, at its expense, insurance on or with respect
to the cost of purchasing replacement power, naming the Lessee as insured and/or
loss payee, unless such insurance would conflict with or otherwise limit the
availability of insurance to be provided or maintained in accordance with
Section 10(a). Nothing in this Section 10 shall prohibit the Lessor or the Owner
Participant from placing at its expense other insurance on or with respect to
Unit 1, the Undivided Interest or the Real Property Interest or the operation of
Unit 1, naming the Lessor or the Owner Participant as insured and/or loss payee,
unless such insurance would conflict with or otherwise limit the insurance to be
provided or maintained in accordance with Section 10(a).
SECTION 11. Rights to Assign or Sublease.
(a) Assignment or Sublease by the Lessee. Without the prior
written consent of the Lessor, the Lessee shall not assign, sublease, transfer
or encumber (except for Permitted Liens) its leasehold interest in the Undivided
Interest or the Real Property Interest under this Facility Lease. The Lessee
shall not, without the prior written consent of the Lessor and the Owner
Participant, part with the possession of, or suffer or allow to pass out of its
possession, the Undivided Interest, the Real Property Interest or any interest
therein, except to the extent required pursuant to the ANPP Participation
Agreement or expressly permitted by the provisions of this Facility Lease or any
other Transaction Document.
(b) Assignment by Lessor as Security for Lessor's Obligations.
To secure the indebtedness evidenced by the Notes, the Lessor will assign to the
Indenture Trustee its right, title and interest to receive certain payments of
Rent (not including, in any event, Excepted Payments), to the extent provided in
the Indenture and may assign to the Indenture Trustee its right, title and
interest in the Undivided Interest and the Real Property Interest as
contemplated by Section 9(j). The Lessee hereby (a) consents to such assignment
pursuant to the terms of the Indenture, (b) agrees to pay directly to the
Indenture Trustee at the Indenture Trustee's Office (so long as the lien of the
Indenture has not been satisfied and discharged and the Lessor is obligated
thereunder) all amounts of Rent (other than Excepted Payments) due or to become
due to the Lessor that shall be required to be paid to the Indenture Trustee
pursuant to the Indenture, (c) agrees that the
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right of the Indenture Trustee to any such payments shall be absolute and
unconditional and shall not be affected by an circumstances whatsoever,
including, without limitation, those circumstances set forth in Section 4 and
(d) agrees that, to the extent provided in the Indenture and until the Indenture
is discharged in accordance with its terms, the Indenture Trustee shall have all
the rights of the Lessor hereunder with respect to Assigned Payments as if the
Indenture Trustee had originally been named herein as the Lessor.
SECTION 12. Lease Renewal.
Subject to the notice requirements set forth in Section 13(a),
at the end of the Basic Lease Term provided that no Default, Event of Default,
event of Loss or Deemed Loss Event shall have occurred and be continuing and the
Notes shall have been paid in full, the Lessee shall have the right to renew the
term of this Facility Lease for a period commencing January 15, 2015, and ending
on the later of January 15, 2017 and the end of the Maximum Option Period (the
Renewal Term), during which the Basic Rent payable shall be the rental provided
in Section 3(a) (iii) and Section 21.
SECTION 13. Notices for Renewal or Purchase;
Purchase Options.
(a) Notice; Determination of Values; Appraisal Procedure. Not
later than three years nor earlier than five years prior to the expiration date
of the Basic Lease Term, and not later than three years nor earlier than five
years prior to the expiration date of the Renewal Term, as the case may be, the
Lessee shall give to the Lessor written notice of its election either to (A)
return the Undivided Interest and the Real Property Interest to the Lessor
pursuant to Section 5, or (B) exercise the renewal option permitted by Section
12 (in the case of the notice delivered in respect of the expiration date of the
Basic Lease Term) or the purchase option permitted by Section 13(b). If the
notice specified in clause (B) of the preceding sentence is given three years
prior to the expiration of the Basic Lease Term, then not later than two years
prior to the expiration date of the Basic Lease Term, the Lessee will give the
Lessor written notice of its election either to exercise the renewal option
permitted by Section 12 or the purchase option permitted by Section 13(b). Any
such election shall be irrevocable as to the Lessee, but no such election shall
be binding on the Lessor if, on the effective date thereof, a Default or an
Event of Default shall have occurred and be continuing or an Event of Loss
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or a Deemed Loss Event shall have occurred. Promptly after giving notice, (i) in
case the renewal option has been elected, the Maximum Option Period shall be
determined by the Appraisal Procedure, or (ii) in case the purchase option
permitted by Section 13(b) has been elected, the Lessee and the Owner
Participant shall agree upon the Fair Sales Value of the Undivided Interest and
the Real Property Interest, or, if within three months after the date of the
Lessee's notice the Lessee and the Owner Participant shall be unable so to
agree, such value shall be determined by the Appraisal Procedure.
(b) Purchase Option at Expiration of the Lease Term. Subject
to the notice requirements set forth in Section 13(a), unless a Default or an
Event of Default shall have occurred and be continuing or an Event of Loss or
Deemed Loss Event shall have occurred, on the date of the expiration of the
Basic Lease Term or the Renewal Term (if elected), the Lessee shall have the
right to purchase the Undivided Interest and the Real Property Interest for a
purchase price equal to the Fair Market Sales Value thereof.
(c) Special Purchase Option. Upon 30 days' prior written
notice to the Lessor, unless a Default or an Event of Default shall have
occurred or be continuing or an Event of Loss or Deemed Loss Event shall have
occurred, if the Lessee shall determine that upon a refunding of the Initial
Series Note (and the Releveraging Note, if theretofore issued) such refunding
would violate any limitation then imposed by the NMPSC, the Lessee shall have
the right to purchase the Undivided Interest and the Real Property Interest for
a purchase price equal to the greater of (i) the Fair Market Sales Value thereof
and (ii) Casualty Value as of the Basic Rent Payment Date first preceding the
date of such purchase (or as of the date of such purchase, if such date shall be
a Basic Rent Payment Date) plus, if such date shall not be a Basic Rent Payment
Date, a pro ration of Basic Rent to the date of purchase.
(d) Purchase of the Undivided Interest; Payment, Etc. If the
Lessee shall have elected to purchase the Undivided pursuant to Section 13(b) or
Section (c), payment by the Lessee of the purchase price for the Undivided
Interest and the Real Property Interest shall be made in immediately available
funds, whereupon the Lessor shall Transfer the Undivided Interest and the Real
Property Interest to the Lessee.
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SECTION 14. Termination for Obsolescence.
(a) Termination Notice. Notwithstanding any provision herein
contained to the contrary, unless a Default or an Event of Default shall have
occurred and be continuing or an Event of Loss or a Deemed Loss Event shall have
occurred, the Lessee shall have the option (provided that the Lessee shall have
delivered to the Lessor an Officers' Certificate to the effect that the Lessee's
Board of Directors has adopted and there is in effect a resolution determining
that Unit 1 is (A) uneconomic to the Lessee or (B) economically obsolete for any
reason; and provided that the Lessee shall be disposing of all its other leased
interests in Unit 1, on at least 360 days' prior written notice (a Termination
Notice) to the Lessor, the Owner Participant and the Indenture Trustee (which
notice shall be irrevocable)) to terminate this Facility Lease on any Basic Rent
Payment Date after January 15, 1998, and prior to January 15, 2012 (the
Termination Date). If the Lessee shall give the Lessor a Termination Notice, the
Lessee shall, as agent for the Lessor, use its best efforts to obtain cash bids
for the purchase of the Undivided Interest and the Real Property Interest,
together with the interest of the Lessor under the Assignment and Assumption.
The Lessor shall also have the right to obtain such cash bids, either directly
or through agents other than the Lessee. The Lessee shall certify to the Lessor
within ten days after the Lessee's receipt of each bid (and, in any event, prior
to the Termination Date) the amount and terms thereof and the name and address
of the party (which shall not be the Lessee or any Affiliate of the Lessee)
submitting such bid.
(b) Right of Lessor to Retain Undivided Interest upon
Termination. The Lessor may elect to retain, rather than sell, the Undivided
Interest and the Real Property Interest by giving notice to the Lessee and to
the Indenture Trustee prior to the Termination Date. It shall be a condition
precedent to the Lessor's right to retain the Undivided Interest and the Real
Property Interest that on or prior to the Termination Date the Lessor shall have
paid (or made provision for payment) to the Indenture Trustee, the unpaid
principal amount of all Notes Outstanding on such date and all premium, if any,
and interest accrued and unpaid on the date of payment. If the Lessor elects to
retain the Undivided Interest and the Real Property Interest pursuant to this
Section 14(b), the Lessee shall pay to the Lessor on the Termination Date the
Basic Rent and any other Rent due or accrued, as the case may be, to and
including the Termination Date, together with an amount equal to the
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excess, if any, of the Termination Value as of the Termination Date over the
highest bona fide offer received pursuant to Section 14(a).
(c) Events on the Termination Date. If the Lessor has not
elected to retain the Undivided Interest and the Real Property Interest as
provided in Section 14(b), on the Termination Date the Lessor shall (upon
receipt of the sale price and all additional payments specified in the next
sentence) Transfer the Undivided Interest and the Real Property Interest for
cash to the bidder (which shall not be the Lessee or an Affiliate of the Lessee)
that shall have submitted the highest bid on or before the Termination Date. The
total sale price realized at such sale shall be retained by the Lessor (subject,
however, to the terms of the Indenture and the requirement that there shall have
been paid, or provision for payment made, to the Indenture Trustee the unpaid
principal of all Notes Outstanding on the Termination Date and all premium, if
any, and interest accrued and unpaid on the date of payment) and, in addition,
on the Termination Date the Lessee shall pay to the Lessor (A) the excess, if
any, of the Termination Value as of the Termination Date over the net sale price
of the Undivided Interest and the Real Property Interest and (B) any Basic Rent
due or accrued, as the case may be, to and including the Termination Date and
shall pay to the Person or Persons entitled thereto all Supplemental Rent (other
than Termination Value). Upon compliance by the Lessee with the applicable
provisions of this Section 14, the obligation of the Lessee to pay Basic Rent
due hereunder for any period after the Termination Date shall cease and the
Basic Lease Term shall end on the Termination Date; provided, however, that, in
the event of termination of this Facility Lease pursuant to this Section 14, the
obligations of the Lessee under the ANPP Participation Agreement (except as
therein expressly provided) and the Assignment and Assumption shall continue in
full force and effect and shall not be impaired by reason of any such
termination. If, other than as a result of the Lessor's election to retain the
Undivided Interest and the Real Property Interest as provided in Section 14(b),
on or as of the Termination Date no such sale shall occur or the Lessee shall
not have complied in full with this Section 14, this Facility Lease shall
continue in full force and effect in accordance with its terms without prejudice
to the Lessee's right to exercise its rights under this Section 14 thereafter,
except that the Lessee shall not be entitled to deliver another Termination
Notice during the 3-year period following such Termination Date. The Lessor
shall be under no duty to solicit bids, to inquire into the efforts of the
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Lessee to obtain bids or otherwise take any action in connection with any such
sale other than, if the Lessor has not elected to retain the Undivided Interest
and the Real Property Interest, to Transfer the Undivided Interest and the Real
Property Interest to the purchaser named in the highest bid certified by the
Lessee to the Lessor or obtained by the Lessor, against receipt of the payments
provided for herein.
(d) Early Termination Notice. In the event that the Lessee
shall fail to exercise its renewal option or purchase option within the time
limit provided by Section 13(a), the Lessor shall have the option, on any Basic
Rent Payment Date thereafter, on at least 120 days prior written notice (an
Early Termination Notice) to the Lessee and the Indenture Trustee, to terminate
this Facility Lease on the Basic Rent Payment Date specified in such notice (the
Early Termination Date). Any Early Termination Notice may be revoked by the
Lessor at any time on or prior to the Early Termination Date.
(e) Events on the Early Termination Date. On the Early
Termination Date the Lessor shall, at its option, (i) Transfer the Undivided
Interest and the Real Property Interest to the bidder (other than the Lessee or
any Affiliate of the Lessee) selected by the Lessor or (ii) retain the Undivided
Interest and the Real Property Interest. It shall be a condition precedent to
the Lessor's right to sell or retain the Undivided Interest and the Real
Property Interest that on or prior to the Early Termination Date the Lessor
shall have paid (or made provision for payment) to the Indenture Trustee on such
date the unpaid principal amount of all Notes Outstanding on such date and all
premium, if any, and interest accrued and unpaid on the date of payment. The
total sale price realized at any such sale shall be retained by the Lessor and,
in addition, on the Early Termination Date the Lessee shall pay to the Lessor
any Basic Rent due or accrued, as the case may be, to and including the Early
Termination Date, and shall pay to the Person or Persons entitled thereto all
Supplemental Rent (other than Termination Value). Upon compliance the Lessee
with the applicable provisions of this Section 14, the obligation of the Lessee
to pay Basic Rent due hereunder for any period after the Early Termination Date
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shall cease and the Lease Term shall end on the Early Termination Date;
provided, however, that in the event of the termination of this Facility Lease
pursuant to this Section 14, the obligations of the Lessee under the ANPP
Participation Agreement (except as therein expressly provided) and the
Assignment and Assumption shall continue in full force and effect and shall not
be impaired by reason of any such termination.
SECTION 15. Events of Default.
The term Event of Default, wherever used herein, shall mean
any of the following events (whatever the reason for such Event of Default and
whether it shall be voluntary, or come about or be effected by operation of law,
or be pursuant to or in compliance with any Applicable Law or Governmental
Action):
(i) the Lessee shall fail to make, or cause to be made, (x)
payment of Casualty Value, Termination Value, Special Casualty Value or payment
due pursuant to exercise of the Cure Option when due, (y) any payment of Basic
Rent within 5 Business Days after the same shall become due or (z) any payment
of Supplemental Rent (other than Casualty Value, Termination Value, Special
Casualty Value or payment due pursuant to exercise of the Cure Option) within 20
days after the same shall become due or demanded, as the case may be; or
(ii) the Lessee shall fail to perform or observe any covenant,
condition or agreement to be performed or observed by it under Section 10(b) (3)
(i), 10(b) (3) (ii), 10(b) (3) (iii) or 10(b) (3) (v) of the Participation
Agreement or Section 7, 10 (other than failure of the Lessee to cause to be
delivered the insurance broker's certificate described therein) or 11 of this
Facility Lease; or
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(iii) the remaining economic useful life of Unit 1, as
determined under Section 8(g) (if required thereby to be so determined), shall
be less than 5-1/2 years as of July 15, 2014, or less than 3-1/2 years as of the
date six months prior to the end of the Renewal Term; or
(iv) the Lessee shall fail to perform or observe any covenant or
agreement to be performed or observed by it under Section 10(b) (3) (viii) of
the Participation Agreement and such failure shall continue for a period of 30
days after there shall have been given to the Lessee by the Lessor or the Owner
Participant a notice specifying such failure and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(v) the Lessee shall fail to perform or observe any covenant,
condition or agreement (other than those referred to in clauses (i) through (iv)
above) to be performed or observed by it under this Facility Lease or any other
Transaction Document, and such failure shall continue for a period of 30 days
after there shall have been given to the Lessee by the Lessor or the Owner
Participant a notice specifying such failure and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(vi) any representation or warranty made by the Lessee in this
Facility Lease, any other Transaction Document (other than the Tax
Indemnification Agreement) or any agreement, document or certificate delivered
by the Lessee in connection herewith or therewith shall prove to have been
incorrect in any material respect when any such representation or warranty was
6091.20.2898.47:1
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made or given and shall remain material and materially incorrect at the time
in question; or
(vii) the Lessee shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part of
its property, or shall consent to any such relief or to the appointment of or
taking of possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall take any corporate action to authorize any of the
foregoing; or an involuntary case or other proceeding shall be commenced against
the Lessee seeking liquidation, reorganization or other relief with respect to
it or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part of
its property, and such involuntary case of other proceeding shall remain
undismissed or unstayed for a period of 60 consecutive days; or
(viii) final judgement for the payment of money in excess of
$1,000,000 shall be rendered against the Lessee and the Lessee shall not have
discharged the same or provided for its discharge in accordance with its terms
or bonded the same or procured a stay of execution thereof within 60 days from
the entry thereof; or
(ix) (1) a default by the Lessee under the ANPP Participation
Agreement in consequence of which the Lessee's right to receive its Generation
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Entitlement Share in PVNGS is suspended by the other ANPP Participants, or (2)
the giving by any ANPP Participant of a notice under Section 23.2 (or any
comparable successor provision) of the ANPP Participation Agreement respecting a
default thereunder by the Lessee and the lapse of 20 Business Days from the
giving of such notice without the Lessee having cured such default; provided,
however, that for purposes of this clause (2) if the Lessee shall have disputed
the existence or nature of a default and such dispute shall have become the
subject of an arbitration under Section 24 (or any comparable successor
provision) of the ANPP Participation Agreement, such 20 Business Day period
shall commence on the date of the final determination of the board of
arbitrators under such Section 24; or
(x) (1) the Lessee shall fail to pay when due (whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise) any
Debt (which term shall mean (A) indebtedness for borrowed money, (B) obligations
as lessee under leases and (C) obligations under direct or indirect guarantees
in respect of, and obligations (contingent or otherwise) to purchase or
otherwise acquire or otherwise to assure a creditor against loss in respect of,
indebtedness or obligations of others of the kinds referred to in clause (A) or
(B) above, in each case if the principal amount (or equivalent) thereof is
greater than $20,000,000) of the Lessee, and such failure shall continue after
the applicable grace period, if any, specified in the agreement or instrument
relating to such Debt, but only if the Lessee shall have received notice of such
failure or a Responsible Officer of the Lessee shall have actual acknowledge of
6091.20.2898.47:1
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such failure; or (2) any other default under any agreement or instrument
relating to any such Debt, or any other event, shall occur and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such default or event is to accelerate, or to
permit the acceleration of, the maturity of such Debt, but only if the Lessee
shall have received notice of such default or a Responsible Officer of the
Lessee shall have actual knowledge of such default.
SECTION 16. Remedies.
(a) Remedies. Upon the occurrence of any Event of Default and
so long as the same shall be continuing, the Lessor may, at its option, declare
this Facility Lease to be in default by written notice to such effect given to
the Lessee, and may exercise one more of the following remedies as the Lessor in
its sole discretion shall elect:
(i) the Lessor may, by notice to the Lessee, rescind or
terminate this Facility Lease;
(ii) the Lessor may (x) demand that the Lessee, and thereupon
the Lessee shall, return possession of the Undivided Interest and the Real
Property Interest promptly to the Lessor in the manner and condition required
by, and otherwise in accordance with the provisions of, this Facility Lease as
if they Undivided Interest and the Real Property Interest were being returned at
the end of the Lease Term and the Lessor shall not be liable for the
reimbursement of the Lessee for any costs and expenses incurred by the Lessee in
connection therewith and (y) enter upon the PANGS Site and take immediate
possession of (to the exclusion of the Lessee) the Undivided Interest and the
Real Property Interest, by summary proceedings or otherwise, all without
6091.20.2898.47:1
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liability to the Lessee for or by reason of such entry or taking of possession,
whether for the restoration of damage to property caused by such taking or
otherwise;
(iii) the Lessor may sell the Undivided Interest and the Real
Property Interest, or any part thereof, together with any interest of the Lessor
under the Assignment and Assumption, at public or private sale, as the Lessor
may determine, free and clear of any rights of the Lessee in the Undivided
Interest and the Real Property Interest and without any duty to account to the
Lessee with respect to such action or inaction or any proceeds with respect
thereto (except to the extent required by clause (v) or (vi) below if the Lessor
shall elect to exercise its rights thereunder), in which event the Lessee's
obligation to pay Basic Rent hereunder for periods commencing after the date of
such sale shall be terminated or proportionately reduced, as the case may be
(except to the extent that Basic Rent is to be included in computations under
clause (v) or (vi) below if the Lessor shall elect to exercise its rights
thereunder);
(iv) the Lessor may hold, keep idle or lease to others all or
any part of the Undivided Interest and the Real Property Interest, as the Lessor
in its sole discretion may determine, free and clear of any rights of the Lessee
and without any duty to account to the Lessee with respect to such action or
inaction or for any proceeds with respect to such action or inaction, except
that the Lessee's obligation to pay Basic Rent for periods commencing after the
Lessee shall have been deprived of use of the Undivided Interest and the Real
Property Interest pursuant to this clause (iv) shall be reduced by the net
proceeds, if any, received by the Lessor from leasing the Undivided Interest and
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the Real Property Interest to any Person other than the Lessee for the same
periods or any portion thereof;
(v) except in the case of an Event of Default specified in
clause (iii) of Section 15, the Lessor may, whether or not the Lessor shall have
exercised or shall thereafter at any time exercise its rights under clause (i),
(ii), (iii) or (iv) above, demand, by written notice to the Lessee specifying a
payment date which shall be a Basic Rent Payment Date not earlier than 10 days
after the date of such notice, that the Lessee pay to the Lessor, and the Lessee
shall pay to the Lessor, on the Basic Rent Payment Date specified in such
notice, as liquidated damages (in lieu of the Basic Rent due after the Basic
Rent Payment specified in such notice), any unpaid Rent due through the Basic
Rent Payment Date specified in such notice plus whichever of the following
amounts the Lessor, in its sole discretion, shall specify in such notice
(together with interest on such amount at the interest rate specified in Section
3(b) (iii) from the Basic Rent Payment Date specified in such notice to the date
of actual payment) (and upon receipt of such payment the Lessor shall Transfer
to the Lessee the Undivided Interest and the Real Property Interest):
(A) an amount equal to the excess, if any, of Casualty Value,
computed as of the Basic Rent Payment Date specified in such notice, over the
Fair Market Rental Value of the Undivided Interest and the Real Property
Interest (determined on the basis of the then actual condition of Unit 1) until
the end of the remaining useful life of Unit 1, after discounting
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such Fair Market Rental Value semi-annually to present value as of the Basic
Rent Payment Date specified in such notice at a rate of 12% per annum;
(B) an amount equal to the excess, if any, of such Casualty
Value over the Fair Market Sales Value of the Undivided Interest and the Real
Property Interest (determined on the basis of the then actual condition of Unit
1) as of the Basic Rent Payment Date specified in such notice; or
(C) an amount equal to the excess, if any, of (1) the present
value as of the Basic Rent Payment Date specified in such notice of all
installments of Basic Rent until the end of the Basic Lease Term or the Renewal
Term, as the case may be, discounted semi-annually at a rate of 10% per annum,
over (2) the present value as of such Basic Rent Payment Date of the Fair Market
Rental Value of the Undivided Interest and the Real Property Interest
(determined on the basis of the then actual condition of Unit 1) until the end
of the Basic Lease Term or the Renewal Term, as the case may be, discounted
semi-annually at a rate of 10% per annum;
(vi) if the Lessor shall have sold all the Undivided Interest
and the Real Property Interest pursuant to clause (iii) above, the Lessor, in
lieu of exercising its rights under clause (v) above with respect to the
Undivided Interest and the Real Property Interest may, if it shall so elect,
demand that the Lessee pay to the Lessor and the Lessee shall pay to the Lessor
on the date of such sale, as liquidated damages for loss of a bargain and not as
a penalty (in lieu of Basic Rent due for periods commencing after the next Basic
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Rent Payment Date following the date of such sale), any unpaid Basic Rent due
through such Basic Rent Payment Date, plus the amount of any deficiency between
the Sale Proceeds and Casualty Value, computed as of such Basic Rent Payment
Date, together with interest at the interest rate specified in Section 3(b)(iii)
on the amount of such Rent and such deficiency from the date of such sale until
the date of actual payment;
(vii) in the case of an Event of Default specified in clause
(iii) of Section 15, the Lessor may demand, by written notice of the Lessee
specifying a payment date which shall be the last Basic Rent Payment Date of the
Lease Term, that the Lessee pay to the Lessor, and the Lessee shall pay to the
Lessor, on such Basic Rent Payment Date, as liquidated damages for loss of a
bargain and not as a penalty, any unpaid Rent due through such Basic Rent
Payment Date plus an amount equal to the Fair Market Sales Value (without regard
to the obligations of the Lessee under Section 10(b)(3)(xi) of the Participation
Agreement) of the Undivided Interest and the Real Property Interest (determined
on the basis of the then actual condition of Unit 1) deter-mined as of such
Basic Rent Payment Date (together with interest on such amount at the interest
rate specified in Section 3(b)(iii) from such Basic Rent Payment Date specified
in such notice to the date of actual payment) (and upon receipt of such payment
the Lessor shall transfer to the Lessee the Undivided Interest and the Real
Property Interest); or
(viii) the Lessor may exercise any other right or remedy that
may be available to it under any Applicable Law or proceed by appropriate court
action to enforce the terms hereof or to recover damages for the breach hereof.
6091.20.2898.47:1
- 39 -
(b) No Release. No restriction or termination of this Facility
Lease, in whole or in part, or repossession of the Undivided Interest or the
Real Property Interest or exercise of any remedy under paragraph (a) of this
Section 16 shall, except as specifically provided therein, relieve the Lessee of
any of its liabilities and obligations hereunder. In addition, the Lessee shall
be liable, except as otherwise provided above, for any and all unpaid Rent due
hereunder before, after or during the exercise of any of the foregoing remedies,
including all reasonable legal fees and other costs and expenses incurred by the
Lessor or the Owner Participant by reason of the occurrence of any Event of
Default or the exercise of the Lessor's remedies with respect thereto. At any
sale of the Undivided Interest, the Real Property Interest or any part thereof
pursuant to this Section 16, the Owner Participant, the Lessor or the Indenture
Trustee may bid for and purchase such property.
(c) Remedies Cumulative. No remedy under paragraph (a) of this
Section 16 is intended to be exclusive, but each shall be cumulative and in
addition to any other remedy provided under such paragraph (a) or otherwise
available to the Lessor at law or in equity. No express or implied waiver by the
Lessor of any Default or Event of Default hereunder shall in any way be, or be
construed to be, a waiver of any future or subsequent Default or Event of
Default. The failure or delay of the Lessor in exercising any right granted it
hereunder upon any occurrence of any of the contingencies set forth herein shall
not constitute a waiver of any such right upon the continuation or recurrence of
any such contingencies or similar contingencies and any single or partial
exercise of any particular right by the Lessor shall not exhaust the same or
constitute a waiver of any other right provided herein. To the extent permitted
by Applicable Law, the Lessee hereby waives any rights now or hereafter
conferred by statute or otherwise which may require the Lessor to sell, lease or
otherwise use the Undivided Interest or Unit 1 in mitigation of the Lessor's
damages as set forth in paragraph (a) of this Section 16 or which may otherwise
limit or modify any of the Lessor's rights and remedies provided in this
Section 16.
6091.20.2898.47:1
- 40 -
(d) Exercise of Other Rights or Remedies. In addition to all
other rights and remedies provided in this Section 16, the Lessor may exercise
any other right or remedy that may be available to it under Applicable Law or
proceed by appropriate court action to enforce the terms hereof or to recover
damages for the breach hereof.
(e) Special Cure Right of Lessee. In the event a "Notice of
Default" is given under Section 15 (iv), the Lessee may, on or prior to the
occurrence of an Event of Default resulting therefrom, give written notice to
the Lessor stating that the Lessee has elected to exercise the option (the Cure
Option) provided in this Section 16(e), which election shall be irrevocable as
to the Lessee. Promptly after the giving of such notice, the Lessee and the
Owner Participant shall agree upon the Fair Market Sales Value of the Undivided
Interest and the Real Property Interest or, if they shall be unable so to agree
within one month after the date of the Lessee's notice, such value shall be
determined by the Appraisal Procedure. On the Basic Rent Payment Date next
following the date that such Fair Market Sales Value shall have been determined,
the Lessee shall pay to the Lessor all Rent due on such Basic Rent Payment Date,
plus an amount equal to the excess of (i) the greater of such Fair Market Sales
Value and the Casualty Value determined as of such Basic Rent Payment Date over
(ii) the unpaid principal amount of the Notes Outstanding on such date after
giving effect to the payment, if any, of the principal installment and payable
on such date. Upon compliance in full by the Lessee with the foregoing
provisions of this paragraph (e) and assumption by the Lessee of all the
obligations and liabilities of the Owner Trustee under the Indenture and the
Notes pursuant to Section 3.9(b) of the Indenture, the Lessor shall Transfer the
Undivided Interest and the Real Property Interest to the Lessee. If the Lessee
shall not have assumed all the obligations and liabilities of the Owner
6091.20.2898.47:1
- 41 -
Trustee under the Indenture and the Notes in accordance with Section 3.9(b) of
the Indenture, but shall have paid all amounts required by this paragraph (e),
the Lessor shall retain the Undivided Interest and the Real Property Interest
subject to the terms of this Facility Lease and Section 7(b)(4) of the
Participation Agreement; provided, however, that the obligation of the Lessee to
pay further Basic Rent shall be reduced to an amount on each Basic Rent Payment
Date equal to the aggregate amount of principal, premium, if any, and accrued
interest then payable on all Notes then Outstanding and this Facility Lease
shall become a security agreement for all purposes of Applicable Law. The Lessee
agrees to use its best efforts to comply with the conditions respecting its
assumption set forth in Section 3.9(b) of the Indenture and, failing such
assumption, agrees to accept a transfer of the Owner Participant's right, title
and interest in the Trust Estate pursuant to Section 7(b)(4) of the
Participation Agreement.
SECTION 17. Notices.
All communications and notices provided for in this Facility
Lease shall be in writing and shall be given in person or by means of telex,
telecopy, or other wire transmission, or mailed by registered or certified mail,
addressed as provided in the Participation Agreement. All such communications
and notices given in such manner shall be effective on the date of receipt of
such communication or notice.
SECTION 18. Successors and Assigns.
This Facility Lease, including all agreements, covenants,
indemnities, representations and warranties, shall be binding upon and inure to
the benefit of the Lessor and its successors and permitted assigns, and the
Lessee and its successors and, to the extent permitted hereby, assigns.
6091.20.2898.47:1
- 42 -
SECTION 19. Right to Perform for Lessee.
If the Lessee shall fail to make any payment of Rent to be
made by it, or shall fail to perform or comply with any of its other agreements
contained herein, or fail to make any payment to be made by it under any ANPP
Project Agreement, or shall fail to perform or comply with any of its other
agreements contained in any ANPP Project Agreement, either the Lessor or the
Owner Participant may, but shall not be obligated to, tender such payment, or
effect such performance or compliance, and the amount of such payment and the
amount of all costs and expenses (including, without limitation, attorneys' and
other professionals' fees and expenses) of the Lessor or the Owner Participant,
as the case may be, incurred in connection with such payment or the performance
of or compliance with such agreement, as the case may be, together with interest
thereon at the Penalty Rate, shall be deemed Supplemental Rent, payable by the
Lessee upon demand. In the event that the Lessor or the Owner Participant shall
cure any default by the Lessee under the ANPP Participation Agreement, then (so
long as an Event of Default has occurred and is continuing) the Lessor, together
with each other Person contributing to such cure, shall be entitled (to the full
extent enforceable in accordance with Applicable Law) to receive the Generation
Entitlement Share of the Lessee under the ANPP Participation Agreement (not
limited to Unit 1), with each contributor to receive a percentage of such
Generation Entitlement Share equal to the percentage of the cure contributed
thereby.
SECTION 20. Additional Covenants.
The Lessee agrees to comply with and to pay, as Supplemental
Rent, all amounts payable by it under the provisions of Section 13 of the
Participation Agreement and under the provisions of the Tax Indemnification
Agreement, which provisions are incorporated herein by this reference as fully
as if set forth in full at this place. The Lessee agrees to comply with its
covenants and agreements set forth in Sections 10(b), 14 and 16 of
6091.20.2898.47:1
- 43 -
the Participation Agreement and Articles III, IV, V and VI of the Assignment and
Assumption which covenants and agreements are incorporated herein by this
reference as fully as if set forth in full at this place.
SECTION 21. Lease of Real Property Interest.
Pursuant to the Deed and the Assignment of Beneficial
Interest, the Lessee has sold to the Lessor the Real Property Interest. The
Lessor hereby grants to the Lessee a leasehold interest in the Real Property
Interest, such leasehold to be coterminous with the lease of the Undivided
Interest hereunder and to be at a rent per annum equal to 12.42% of the Real
Estate Investment payable by the Lessee to the Lessor in arrears in equal
semiannual installments on each Basic Rent Payment Date during the Lease Term.
SECTION 22. Amendments and Miscellaneous.
(a) Amendments in Writing. The terms of this Facility Lease
may not be waived, altered, modified, amended, supplemented or terminated in any
manner whatsoever except by written instrument signed by the Lessor and the
Lessee.
(b) Survival. (1) All indemnities, representations and
warranties contained in this Facility Lease and the other Transaction Documents
and the Financing Documents and in any agreement, document or certificate
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive, and continue in effect following, the execution and delivery of
this Facility Lease and the expiration or other termination of this Facility
Lease.
(2) The obligations of the Lessee to pay Supplemental Rent and
the obligations of the Lessee under Sections 5, 16, 19 and 20 hereof shall
survive the expiration or termination of this Facility Lease. The extension of
any applicable statute of limitations by the Owner Trustee, the Indenture
Trustee, the Lessee, the Owner Participant, the Loan Participant or any
6091.20.2898.47:1
- 44 -
Indemnitee shall not affect such survival. The obligations of the Lessee under
Section 20 are expressly made for the benefit of, and shall be enforceable by,
any Indemnitee, separately or together, without declaring this Facility Lease to
be in default and notwithstanding any assignment by the Lessor of this Facility
Lease or any of its rights thereunder or any disposition of all or any part of
any interest in the Undivided Interest, the Real Property Interest, Unit 1 or
any other property referred to in this Facility Lease or in this Facility Lease
or any other Transaction Document or Financing Document. All payments required
to be made pursuant to Section 20 shall be made directly to, or as otherwise
requested by, the Indemnitee entitled thereto upon written demand by such
Indemnitee.
(c) Severability of Provisions. Any provision of this Facility
Lease which may be determined by competent authority to be prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforce-ability without invalidating the
remaining provisions hereof or thereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by Applicable Law, the Lessee hereby waives any provision of law which renders
any provision hereof prohibited or unenforceable in any respect.
(d) True Lease. This Facility Lease shall constitute an
agreement of lease and nothing herein or therein shall be construed as conveying
to the Lessee any right, title or interest in or to the Undivided Interest or
the Real Property Interest, except as lessee only.
(e) Original Lease. The single executed original of this
Facility Lease marked "THIS COUNTERPART IS THE ORIGINAL COUNTERPART" and
containing the receipt of the Indenture Trustee thereon shall be the "Original"
of this Facility Lease. To the extent that this Facility Lease constitutes
6091.20.2898.47:1
- 45 -
chattel paper, as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest in this Facility
Lease may be created through the transfer or possession of any counterpart other
than the "Original".
(f) Governing Law. This Facility Lease shall be governed by
and construed in accordance with the law of the State of New York, except to the
extent that pursuant to the law of the State of Arizona the law of the State of
Arizona is mandatorily applicable thereto.
(g) Headings. The division of this Facility Lease into
sections, the provision of a table of contents and the insertion of headings are
for convenience of reference only and shall not affect the construction or
interpretation of this Facility Lease.
(h) Concerning the Owner Trustee. FNB is entering into this
Facility Lease solely as Owner Trustee under the Trust Agreement and not in its
individual capacity. Anything herein to the contrary notwithstanding, all and
each of the representations, war-ranties, undertakings and agreements herein
made on the part of the Owner Trustee are made and intended not as personal
representations, warranties, undertakings and agreements by or for the purpose
or with the intention of binding FNB personally but are made and intended for
the purpose of binding only the Trust Estate, and this Facility Lease is
executed and delivered by the Owner Trustee solely in the exercise of the powers
expressly conferred upon it as trustee under the Trust Agreement; and no
personal liability or responsibility is assumed hereunder by or shall at any
time be enforceable against FNB or any successor in trust or the Owner
Participant on account of any representations, warranty, undertaking or
agreement hereunder of the Owner Trustee, either expressed or implied, all such
personal liability, if any, being expressly waived by the Lessee, except that
the Lessee or any Person claiming by, through or under it, making claim
hereunder, may look to the Trust Estate for satisfaction of the same and the
6091.20.2898.47:1
- 46 -
Owner Trustee or its successor in trust, as applicable, shall be personally
liable for its own gross negligence or willful misconduct. If a successor owner
trustee is appointed in accordance with the terms of the Trust Agreement, such
successor owner trustee shall, without any further act, succeed to all the
rights, duties, immunities and obligations of the Owner Trustee hereunder and
the predecessor owner trustee shall be released from all further duties and
obligations hereunder.
(i) Disclosure. Pursuant to Arizona Revised Statutes Section
33-401, the beneficiary of the Trust Agreement is the Owner Participant
described in Schedule 1 hereto. The address of the beneficiary is also therein
described. A copy of the Trust Agreement is available for inspection at the
offices of the Owner Trustee at 100 Federal Street, Boston, Massachusetts 02110,
Attention of Corporate Trust Division.
(j) Counterpart Execution. This Facility Lease may be executed
in any number of counterparts and by each of the parties hereto or thereto on
separate counterparts, all such counterparts together constituting but one and
the same instrument.
6091.20.2898.47:1
- 47 -
IN WITNESS WHEREOF, each of the parties hereto has caused this
Facility Lease to be duly executed in New York, New York by an officer thereunto
duly authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Owner Trustee under a Trust
Agreement, dated as of December 16, 1985,
with Burnham Leasing Corporation
By: /S/
Vice President
PUBLIC SERVICE COMPANY OF NEW
MEXICO,
By: /S/
Senior Vice President and
Chief Financial Officer
6091.BURNHAM.2898.47A:2
- 48 -
State of New York )
) ss:
County of New York )
The foregoing instrument was acknowledged before me this 31st
day of December, 1985, by A.J. ROBISON, the Senior Vice President and Chief
Financial Officer of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico
corporation, on behalf of the
corporation.
/S/
Notary Public
State of New York )
) ss:
County of New York )
The foregoing instrument was acknowledged before me this 31st
day of December, 1985, by CLARK M. WHITCOMB, a Vice President of THE FIRST
NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985.
/S/
Notary Public
6091.BURNHAM.2898.47A:2
SCHEDULE 1
to
LEASE
OWNER PARTICIPANT INFORMATION
1. The Owner Participant is Burnham Leasing Corporation, a New
York corporation, whose address is 60 Broad Street, New York, New York 10004,
Attention: Chief Financial Officer.
2. The daily equivalent rate is .0242685% of Facility Cost.
3. The assumed interest rate on the Notes utilized in
determining the limitations set forth in Section 3(d) is 11.84%.
6091.BURNHAM.2898.47A:2
SCHEDULE 2
TO LEASE
BASIC RENT PERCENTAGES
On each Basic Rent Payment Date the percentage of Facility Cost is 4.3683233%.
SCHEDULE 4
to
LEASE
SCHEDULE OF SPECIAL CASUALTY VALUES
SCHEDULE 3
to
LEASE
SCHEDULE TO CASUALTY VALUES
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
1/15/1986 104.9449929 1/15/2010 45.6329355
7/15/1986 104.9449929 7/15/2010 42.8476191
1/15/1987 106.7906349 1/15/2011 40.2065051
7/15/1987 108.3567602 7/15/2011 37.6968572
1/15/1988 109.6453406 1/15/2012 35.3513537
7/15/1988 110.7459963 7/15/2012 33.1926801
1/15/1989 111.6684070 1/15/2013 31.0385731
7/15/1989 112.4079070 7/15/2013 28.6298750
1/15/1990 112.9478299 1/15/2014 26.0153606
7/15/1990 113.2823292 7/15/2014 23.1718185
1/15/1991 113.3934703 1/15/2015 20,000000
7/15/1991 113.2872211
1/15/1992 112.9615662
7/15/1992 112.4099531
1/15/1993 111.6146188
7/15/1993 111.8178282
1/15/1994 113.2588791
7/15/1994 115.1747439
1/15/1995 116.4172103
7/15/1995 114.9036415
1/15/1996 112.4507038
7/15/1996 109.6691084
1/15/1997 106.9772870
7/15/1997 103.8909368
1/15/1998 100.9371133
7/15/1998 97.5501383
1/15/1999 95.3829528
7/15/1999 94.0642048
1/15/2000 91.7972204
7/15/2000 90.4161433
1/15/2001 88.0435117
7/15/2001 86.6035347
1/15/2002 84.1210666
7/15/2002 82.6204585
1/15/2003 80.0238785
7/15/2003 78.4609530
1/15/2004 75.7459084
7/15/2004 74.1190412
1/15/2005 71.2811124
7/15/2005 68.5579027
1/15/2006 66.2116454
7/15/2006 63.8258487
1/15/2007 61.3746389
7/15/2007 58.8892024
1/15/2008 56.3361083
7/15/2008 53.7482788
1/15/2009 51.0906065
7/15/2009 48.3977741
Percentage Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
30 JAN 1986 102.54722 30 DEC 1989 116.00042
30 FEB 1986 103.64809 30 JAN 1990 112.41168
30 MAR 1986 104.75644 30 FEB 1990 113.20895
30 APR 1986 105.85531 30 MAR 1990 114.00891
30 MAY 1986 106.90920 30 APR 1990 114.79379
30 JUN 1986 107.99805 30 MAY 1990 115.55060
30 JUL 1986 104.66690 30 JUN 1990 116.32934
30 AUG 1986 105.70480 30 JUL 1990 112.70049
30 SEP 1986 106.76439 30 AUG 1990 113.45689
30 OCT 1986 107.77067 30 SEP 1990 114.21556
30 NOV 1986 108.81131 30 OCT 1990 114.93740
30 DEC 1986 109.85732 30 NOV 1990 115.68063
30 JAN 1987 106.48278 30 DEC 1990 116.42596
30 FEB 1987 107.47676 30 JAN 1991 112.76362
30 MAR 1987 108.49187 30 FEB 1991 113.48483
30 APR 1987 109.48584 30 MAR 1991 114.20996
30 MAY 1987 110.44763 30 APR 1991 114.91859
30 JUN 1987 111.43881 30 MAY 1991 115.60346
30 JUL 1987 108.01763 30 JUN 1991 116.30691
30 AUG 1987 108.95994 30 JUL 1991 112.60692
30 SEP 1987 109.92276 30 AUG 1991 113.28852
30 OCT 1987 110.83991 30 SEP 1991 113.97163
30 NOV 1987 111.78590 30 OCT 1991 114.62245
30 DEC 1987 112.73605 30 NOV 1991 115.29131
30 JAN 1988 109.27090 30 DEC 1991 115.96152
30 FEB 1988 110.19466 30 JAN 1992 112.22826
30 MAR 1988 111.12455 30 FEB 1992 112.87585
30 APR 1988 112.03624 30 MAR 1992 113.52462
30 MAY 1988 112.92193 30 APR 1992 114.15949
30 JUN 1988 113.83156 30 MAY 1992 114.76960
30 JUL 1988 110.33408 30 JUN 1992 115.39710
30 AUG 1988 111.22450 30 JUL 1992 111.62095
30 SEP 1988 112.11852 30 AUG 1992 112.22479
30 OCT 1988 112.97559 30 SEP 1992 112.82939
30 NOV 1988 113.85615 30 OCT 1992 113.40186
30 DEC 1988 114.74020 30 NOV 1992 113.99113
30 JAN 1989 111.21711 30 DEC 1992 114.58097
30 FEB 1989 112.08135 30 JAN 1993 110.76709
30 MAR 1989 112.94895 30 FEB 1993 111.33238
30 APR 1989 113.80184 30 MAR 1993 111.89806
30 MAY 1989 114.62675 30 APR 1993 112.44941
30 JUN 1989 115.47466 30 MAY 1993 112.97597
30 JUL 1989 111.91523 30 JUN 1993 113.51859
30 AUG 1989 112.74245 30 JUL 1993 109.68773
30 SEP 1989 113.57265 30 AUG 1993 110.22027
30 OCT 1989 114.36596 30 SEP 1993 110.75290
30 NOV 1989 115.18177 30 OCT 1993 111.28561
30 NOV 1993
30 DEC 1993
SCHEDULE 4
to
LEASE
SCHEDULE OF SPECIAL CASUALTY VALUES
30 NOV 1993 111.81840 30 JAN 1998 96.86932
30 DEC 1993 112.35127 30 FEB 1998 97.30108
30 JAN 1994 108.51231 30 MAR 1998 97.73297
30 FEB 1994 109.03561 30 APR 1998 98.16499
30 MAR 1994 109.55900 30 MAY 1998 98.59715
30 APR 1994 110.08248 30 JUN 1998 99.02943
30 MAY 1994 110.60604 30 JUL 1998 95.08740
30 JUN 1994 111.12969 30 AUG 1998 95.50515
30 JUL 1994 107.28128 30 SEP 1998 95.92304
30 AUG 1994 107.79490 30 OCT 1998 96.34107
30 SEP 1994 108.30862 30 NOV 1998 96.75923
30 OCT 1994 108.82242 30 DEC 1998 97.17753
30 NOV 1994 109.33632 30 JAN 1999 93.24199
30 DEC 1994 109.85031 30 FEB 1999 93.64041
30 JAN 1995 105.99200 30 MAR 1999 94.04822
30 FEB 1995 106.49549 30 APR 1999 94.45618
30 MAR 1995 106.99907 30 MAY 1999 94.88336
30 APR 1995 107.50275 30 JUN 1999 95.30138
30 MAY 1995 108.00652 30 JUL 1999 91.36876
30 JUN 1995 108.51040 30 AUG 1999 91.75200
30 JUL 1995 104.64171 30 SEP 1999 92.15473
30 AUG 1995 105.13459 30 OCT 1999 92.55760
30 SEP 1995 105.62756 30 NOV 1999 92.96063
30 OCT 1995 106.12063 30 DEC 1999 93.36381
30 NOV 1995 106.61380 30 JAN 2000 89.41386
30 DEC 1995 107.10708 30 FEB 2000 89.79616
30 JAN 1996 103.22754 30 MAR 2000 90.18837
30 FEB 1996 103.70929 30 APR 2000 90.58073
30 MAR 1996 104.19115 30 MAY 2000 90.99331
30 APR 1996 104.67311 30 JUN 2000 91.39628
30 MAY 1996 105.15518 30 JUL 2000 87.44946
30 JUN 1996 105.63736 30 AUG 2000 87.81585
30 JUL 1996 101.74645 30 SEP 2000 88.20275
30 AUG 1996 102.21656 30 OCT 2000 88.58982
30 SEP 1996 102.68678 30 NOV 2000 88.97705
30 OCT 1996 103.15711 30 DEC 2000 89.36446
30 NOV 1996 103.62755 30 JAN 2001 85.39946
30 DEC 1996 104.09811 30 FEB 2001 85.76492
30 JAN 1997 100.19529 30 MAR 2001 86.14081
30 FEB 1997 100.65320 30 APR 2001 86.51687
30 MAR 1997 101.11123 30 MAY 2001 86.91421
30 APR 1997 101.56938 30 JUN 2001 87.30144
30 MAY 1997 102.02764 30 JUL 2001 83.33981
30 JUN 1997 102.48602 30 AUG 2001 83.68859
30 JUL 1997 98.57073 30 SEP 2001 84.05895
30 AUG 1997 99.01587 30 OCT 2001 84.42950
30 SEP 1997 99.46114 30 NOV 2001 84.80023
30 OCT 1997 99.90652 30 DEC 2002 85.17115
30 NOV 1997 100.35203 30 JAN 2002 81.19045
30 DEC 1997 100.79767 30 FEB 2002 81.53831
30 JAN 1998 96.86932
SCHEDULE 4
to
LEASE
SCHEDULE OF SPECIAL CASUALTY VALUES
30 MAR 2002 81.89715 30 APR 2006 63.09828
30 APR 2002 82.25618 30 MAY 2006 63.41309
30 MAY 2002 82.63761 30 JUN 2006 63.71494
30 JUN 2002 83.00841 30 JUL 2006 59.67209
30 JUL 2002 79.03131 30 AUG 2006 59.90959
30 AUG 2002 79.36168 30 SEP 2006 60.18114
30 SEP 2002 79.71478 30 OCT 2006 60.48094
30 OCT 2002 80.06807 30 NOV 2006 60.76741
30 NOV 2002 80.42157 30 DEC 2006 61.05437
30 DEC 2002 80.77528 30 JAN 2007 56.99607
30 JAN 2003 76.77818 30 FEB 2007 57.22714
30 FEB 2003 77.10766 30 MAR 2007 57.46705
30 MAR 2003 77.44869 30 APR 2007 57.75958
30 APR 2003 77.78994 30 MAY 2007 58.05516
30 MAY 2003 78.15476 30 JUN 2007 58.33713
30 JUN 2003 78.50841 30 JUL 2007 54.27558
30 JUL 2003 74.51517 30 AUG 2007 54.46990
30 AUG 2003 74.82632 30 SEP 2007 54.74005
30 SEP 2003 75.16138 30 OCT 2007 55.01992
30 OCT 2003 75.49667 30 NOV 2007 55.28580
30 NOV 2003 75.83218 30 DEC 2007 55.55220
30 DEC 2003 76.16792 30 JAN 2008 51.47450
30 JAN 2004 72.15371 30 FEB 2008 51.68218
30 FEB 2004 72.46399 30 MAR 2008 51.92020
30 MAR 2004 72.78644 30 APR 2008 52.17150
30 APR 2004 73.10912 30 MAY 2008 52.44706
30 MAY 2004 73.45662 30 JUN 2008 52.70833
30 JUN 2004 73.79237 30 JUL 2008 48.62731
30 JUL 2004 69.78229 30 AUG 2008 48.81749
30 AUG 2004 70.07337 30 SEP 2008 49.04536
30 SEP 2004 70.38961 30 OCT 2008 49.30450
30 OCT 2004 70.70610 30 NOV 2008 49.54894
30 NOV 2004 71.02284 30 DEC 2008 49.79396
30 DEC 2004 71.33983 30 JAN 2009 45.69606
30 JAN 2005 67.30778 30 FEB 2009 45.87938
30 FEB 2005 67.59802 30 MAR 2009 46.09461
30 MAR 2005 67.90107 30 APR 2009 46.32383
30 APR 2005 68.20439 30 MAY 2009 46.57857
30 MAY 2005 68.53381 30 JUN 2009 46.81831
30 JUN 2005 68.85090 30 JUL 2009 42.71705
30 JUL 2005 64.82101 30 AUG 2009 42.88209
30 AUG 2005 65.08662 30 SEP 2009 43.08677
30 SEP 2005 65.37871 30 OCT 2009 43.32435
30 OCT 2005 65.69764 30 NOV 2009 43.54650
30 NOV 2005 66.00389 30 DEC 2009 43.76927
30 DEC 2005 66.31059 30 JAN 2010 39.64990
30 JAN 2006 62.27094 30 FEB 2010 39.81258
30 FEB 2006 62.52446 30 MAR 2010 40.00605
30 MAR 2006 62.80539 30 APR 2010 40.21428
SCHEDULE 4
to
LEASE
SCHEDULE OF SPECIAL CASUALTY VALUES
30 MAY 2010 40.44946 30 JUN 2014 17.82200
30 JUN 2010 40.66889 30 JUL 2014 13.69703
30 JUL 2010 36.54160 30 AUG 2014 13.71950
30 AUG 2010 36.75182 30 SEP 2014 13.84269
30 SEP 2010 36.96306 30 OCT 2014 14.00862
30 OCT 2010 37.21023 30 NOV 2014 14.15552
30 NOV 2010 37.44141 30 DEC 2014 14.30390
30 DEC 2010 37.67386 30 JAN 2015 14.45385
30 JAN 2011 33.56106 30 FEB 2015 10.36392
30 FEB 2011 33.78481
30 MAR 2011 34.01011
30 APR 2011 34.25218
30 MAY 2011 34.52503
30 JUN 2011 34.78171
30 JUL 2011 30.69470
30 AUG 2011 30.94344
30 SEP 2011 31.19440
30 OCT 2011 31.48591
30 NOV 2011 31.76102
30 DEC 2011 32.03866
30 JAN 2012 27.97434
30 FEB 2012 28.24479
30 MAR 2012 28.51811
30 APR 2012 28.81105
30 MAY 2012 29.13901
30 JUN 2012 29.45044
30 JUL 2012 25.42895
30 AUG 2012 25.66442
30 SEP 2012 25.94466
30 OCT 2012 26.26950
30 NOV 2012 26.57742
30 DEC 2012 26.88890
30 JAN 2013 22.87848
30 FEB 2013 23.01696
30 MAR 2013 23.25765
30 APR 2013 23.51922
30 MAY 2013 23.81622
30 JUN 2013 24.09586
30 JUL 2013 20.05318
30 AUG 2013 20.15899
30 SEP 2013 20.36659
30 OCT 2013 20.61801
30 NOV 2013 20.85150
30 DEC 2013 21.08759
30 JAN 2014 17.00080
30 FEB 2014 17.06193
30 MAR 2014 17.22429
30 APR 2014 17.40681
30 MAY 2014 17.62360
Basic
Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
7/15/1986 104.3596781 1/15/2010 39.5550496
1/15/1987 106.1754379 7/15/2010 36.4594370
7/15/1987 107.7101553 1/15/2011 33.4921851
1/15/1988 108.9657244 7/15/2011 30.6397490
7/15/1988 110.0316834 1/15/2012 27.9339567
1/15/1989 110.9176260 7/15/2012 25.3966003
7/15/1989 111.6187962 1/15/2013 22.8444777
1/15/1990 112.1184324 7/15/2013 20.0174438
7/15/1990 112.4105882 1/15/2014 16.9632363
1/15/1991 112.4772241 7/15/2014 13.6575533
7/15/1991 112.3241974 1/15/2015 10.0000000
1/15/1992 111.9493769
7/15/1992 111.3460882
1/15/1993 110.4964402
7/15/1993 110.6425629
1/15/1994 112.0236126
7/15/1994 113.8764128
1/15/1995 115.0525952
7/15/1995 113.4693583
1/15/1996 110.9431956
7/15/1996 108.0846369
1/15/1997 105.3119231
7/15/1997 102.1405505
1/15/1998 99.0973640
7/15/1998 95.6164637
1/15/1999 93.3505577
7/15/1999 91.9280492
1/15/2000 89.5520069
7/15/2000 88.0563043
1/15/2001 85.5631951
7/15/2001 83.9965897
1/15/2002 81.3810284
7/15/2002 79.7405323
1/15/2003 76.9969225
7/15/2003 75.2794608
1/15/2004 72.4019905
7/15/2004 70.6044053
1/15/2005 67.5870427
7/15/2005 64.6752385
1/15/2006 62.1307583
7/15/2006 59.5366188
1/15/2007 56.8664297
7/15/2007 54.1508341
1/15/2008 51.3558306
7/15/2008 48.5137414
1/15/2009 45.5888287
7/15/2009 42.6151122
EXHIBIT 28.1
EXHIBIT B
When Recorded, Return to: Gregg R. Neilsen
Snell & Wilmer
3100 Valley Bank Center
Phoenix, Arizona 85073
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS AMENDED BY
THIS AMENDMENT NO. 1 THERETO HAVE BEEN ASSIGNED TO, AND ARE SUBJECT TO A
SECURITY INTEREST IN FAVOR OF, CHEMICAL BANK, AS INDENTURE TRUSTEE UNDER A TRUST
INDENTURE, MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF RENTS DATED AS OF
DECEMBER 16, 1985, AS AMENDED. THIS AMENDMENT NO. 1 HAS BEEN EXECUTED IN SEVERAL
COUNTERPARTS. SEE SECTION 3(f) OF THIS AMENDMENT NO. 1 FOR INFORMATION
CONCERNING THE RIGHTS OF HOLDERS OF VARIOUS COUNTERPARTS HEREOF.
THIS COUNTERPART IS NOT THE ORIGINAL COUNTERPART.
================================================================================
AMENDMENT NO. 1
Dated as of July 15, 1986
to
FACILITY LEASE
Dated as of December 16, 1985
between
THE FIRST NATIONAL BANK OF BOSTON
not in its individual capacity,
but solely as Owner Trustee under
a Trust Agreement, dated as of
December 16, 1985, with Burnham
Leasing Corporation
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
================================================================================
Original Facility Lease recorded December 31, 1985,
as Instrument No. 85-623268, re-recorded April 17,
1986, as Instrument No. 86-187558 and confirmed by
document recorded April 25, 1986, as Instrument
No. 86-203239, in Maricopa County, Arizona Recorder's
Office.
================================================================================
AMENDMENT NO. 1 dated as of July 15, 1986 (Amendment No. 1),
to the Facility Lease dated as of December 16, 1985, between THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, not in its individual capacity,
but solely as Owner Trustee under a Trust Agreement, dated as of December 16,
1985, with Burnham Leasing Corporation (the Lessor), and PUBLIC SERVICE COMPANY
OF NEW MEXICO, a New Mexico corporation (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessee and the Lessor have heretofore entered
into a Facility Lease dated as of December 16, 1985 (the Facility Lease),
providing for the lease by the Lessor to the Lessee of the Undivided Interest
and the Real Property Interest;
WHEREAS, Section 3(e) of the Facility Lease provides for an
adjustment to Basic Rent and to the schedules of Casualty Values, Special
Casualty Values and Termination Values in the event, among other things, that
the Fixed Rate Note is issued; and
WHEREAS, the Fixed Rate Notes are being issued pursuant to
Supplemental Indenture No. 1, dated as of July 15, 1986, to the Indenture;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein or in the recitals shall have the meanings assigned to
such terms in Appendix A and Schedule 1 to the Facility Lease.
SECTION 2. Amendments.
(a) Section 3(a)(ii) of the Facility Lease is amended to read
in its entirety as follows:
"(ii) (1) on July 15, 1986 an amount equal to 4.3683233% of the
Facility Cost and (2) on January 15, 1987 and on each Basic Rent
- 1 -
Payment Date thereafter to and including January 15, 2015, an amount equal to
4.57322% of Facility Cost; and".
(b) Section 10(a) of the Facility Lease is amended to read in
its entirety as follows:
"(a) Required Insurance. The Lessee will use its best efforts to cause
the Operating Agent to carry and maintain insurance required under the ANPP
Participation Agreement and will make all payments required of the Lessee under
the ANPP Participation Agreement in respect of such insurance. The Lessee will
at all times maintain, directly or through the Operating Agent, policies of
casualty and liability insurance with respect to the Undivided Interest and the
Real Property Interest in such amounts and with such coverage as shall be
adequate in accordance with prudent utility practice. Any policies of insurance
in respect of destruction, damage, loss, theft or other casualty to the
Undivided Interest, the Real Property Interest, Unit 1 or any part thereof shall
name the Lessor (and, to the extent practicable, the Owner Participant) as
additional insured, as its interest (or their interests) may appear, and any
policies with respect to nuclear liability insurance with respect to the
Undivided Interest, the Real Property Interest, Unit 1, or any part thereof,
shall include all Indemnities as "insureds" or through endorsement; provided,
however, that if the Operating Agent, as trustee, shall become the loss payee
under any policy of insurance constituting Project Insurance, then the Lessor
and the Owner Participant shall be and be made beneficiaries of the trust
arrangement under which the Operating Agent acts as trustee. The Lessee shall,
- 2 -
on or before March 1 of each year, commencing March 1, 1987, furnish to the
Lessor and the Owner Participant (A) a report signed by the broker or brokers
for the PVNGS insurance (or if insurance is placed directly by the Operating
Agent, a certificate signed by the Operating Agent) (i) showing the insurance
then maintained by the ANPP Participants with respect to PVNGS, (ii) stating
that no premiums are then delinquent, and (iii) stating that the insurance
maintained by the ANPP Participants with respect to PVNGS is in accordance with
the terms of (1) the ANPP Participation Agreement and (2) this Section 10, (B) a
report signed by the broker or brokers for the Lessee's insurance (of if
insurance is placed directly by the Lessee, a certificate signed by the Lessee)
showing the separate insurance, if any, then maintained by the Lessee with
respect to its interest in PVNGS and stating that no premium under such
insurance are delinquent; (C) a certificate signed by the Lessee stating that
the insurance maintained by the ANPP Participants and by the Lessee, identified
on the reports to be delivered pursuant to clauses (A) and (B), is in accordance
with prudent utility practice within the nuclear industry, the ANPP
Participation Agreement and this Section 10; and (D) upon the request of the
Lessor or the Owner Participant, copies (to the extent permitted by the issuers
of such policies) of policies so maintained. Any report by an insurance broker
with respect to clause (A)(iii)(1) may be made in reliance upon a schedule
provided by the Lessee (a copy of which shall be attached) identifying the
insurance (by coverage, limits, insureds and other pertinent details) required
to be maintained under the ANPP Participation Agreement. Any report with respect
to clause (A)(ii)(2) may be made in reliance upon a similar schedule provided by
- 3 -
the Lessee (a copy of which shall be attached) identifying the insurance
required to be maintained under this Section 10. All insurance proceeds paid in
respect of damage, destruction, loss, theft or other casualty to the Undivided
Interest or the Real Property Interest shall be applied as provided in Section
9(g), (h) or (i), as the case may be, subject, however, to any priority
allocations of such proceeds to decontamination and debris removal set forth in
the insurance policies or required under Applicable Law. In the event that
either the Operating Agent or the Lessee delivers a certificate pursuant to
clause (A) or (B) of the foregoing, the Owner Participant shall be entitled to
receive (if it so requests and if the insurer will issue the same) a report from
any insurer listed in such certificate."
(c) Section 16(a)(v) of the Facility Lease is hereby amended
to insert the words "may, if it shall so elect in its sole discretion," in lieu
of the word "shall" in the parenthetical phrase first preceding clause A of
Section 16(a)(v).
(d) Schedule 3 to the Facility Lease (Schedule of Casualty
Values) is hereby replaced with Schedule 1 hereto.
(e) Schedule 4 to the Facility Lease (Schedule of Special
Casualty Values) is hereby replaced with Schedule 2 hereto.
(f) Schedule 5 to the Facility Lease (Schedule of Termination
Values) is hereby replaced with Schedule 3 hereto.
(g) Schedule 2 to the Facility Lease (Basic Rent Percentage)
is hereby deleted in its entirety.
- 4 -
SECTION 3. Miscellaneous.
(a) Partial Prepayment of Rent. In accordance with the last
sentence of Section 3(a) of the Facility Lease, the Lessee shall pay an amount
equal to $42,191.78 on July 17, 1986, such amount (i) being equal to the
interest payment due on the Initial Series Note on such date and (ii) to be
credited against Basic Rent due on January 15, 1987.
(b) Effective Date of Amendments. The amend- ments set forth
in Section 2 hereof shall be and become effective upon the execution hereof by
the parties hereto.
(c) Counterpart Execution. This Amendment No. 1 may be
executed in any number of counterparts and by each of the parties hereto on
separate counterparts; all such counterparts shall together constitute but one
and the same instrument.
(d) Governing Law. This Amendment No. 1 has been negotiated
and delivered in the State of New York and shall be governed by, and be
construed in accordance with, the laws of the State of New York, except to the
extent that pursuant to the law of the State of Arizona such law is mandatorily
applicable hereto.
(e) Disclosure. Pursuant to Arizona Revised Statutes Section
33-401, the beneficiary of the Trust Agreement is Burnham Leasing Corporation, a
Delaware corporation. The address of the beneficiary is 60 Broad Street, New
York, New York 10004, Attention: Chief Financial Officer. A copy of the Trust
Agreement is available for inspection at the offices of the Owner Trustee at 100
Federal Street, Boston, Massachusetts 02110, Attention of Corporate Trust
Division.
(f) Amendment No. 1. The single executed orig- inal of this
Amendment No. 1 marked "THIS COUNTERPART IS THE ORIGINAL COUNTERPART" and
containing the receipt of the Indenture Trustee thereon shall be the "Original"
- 5 -
of this Amendment No. 1. To the extent that this Amendment No. 1 constitutes
chattel paper, as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest in this Amendment
No. 1 may be created or continued through the transfer or possession of any
counterpart other than the "Original".
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 1 to Facility Lease to be duly executed in New York, New York by
an officer thereunto duly authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with
Burnham Leasing Corporation
By: _______________________________
Authorized Officer
PUBLIC SERVICE COMPANY OF NEW
MEXICO,
By: _______________________________
Vice President and Corporate
Controller
- 6 -
State of New York )
) ss.
County of New York )
The foregoing instrument was acknowledged before me this 16th
day of July, by B. D. LACKEY, the Vice President and Corporate Controller of
PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation, on behalf of the
corporation.
-------------------------------
Notary Public
State of New York )
) ss.
County of New York )
The foregoing instrument was acknowledged before me this 16th
day of July, by _____________________, an Authorized Officer of THE FIRST
NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Burnham Leasing Corporation.
-------------------------------
Notary Public
SCHEDULE
to
AMENDMENT NO. 1
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
7/15/1986 106.6269350 7/15/2005 72.4819062
1/15/1987 108.4620154 1/15/2006 70.1272653
7/15/1987 110.0191648 7/15/2006 67.7223143
1/15/1988 111.3308106 1/15/2007 65.2424137
7/15/1988 112.4699820 7/15/2007 62.7159973
1/15/1989 113.4394230 1/15/2008 60.1110508
7/15/1989 114.2371946 7/15/2008 57.4576292
1/15/1990 114.8476467 1/15/2009 54.7218716
7/15/1990 115.2657844 7/15/2009 51.9355999
1/15/1991 115.4747706 1/15/2010 49.0630858
7/15/1991 115.4811581 7/15/2010 46.1380045
1/15/1992 115.2837367 1/15/2011 43.1255891
7/15/1992 114.8727613 7/15/2011 40.2351879
1/15/1993 114.2315094 1/15/2012 37.4545358
7/15/1993 113.3518165 7/15/2012 34.8021269
1/15/1994 114.2544464 1/15/2013 32.3125759
7/15/1994 116.2447321 7/15/2013 29.6407060
1/15/1995 117.5625418 1/15/2014 26.7123360
7/15/1995 116.1352724 7/15/2014 23.5329689
1/15/1996 113.7700741 1/15/2015 20.00000000
7/15/1996 111.0905234
1/15/1997 108.5017094
7/15/1997 105.5182863
1/15/1998 102.6512304
7/15/1998 100.7617481
1/15/1999 98.6890884
7/15/1999 97.4270097
1/15/2000 95.2439805
7/15/2000 93.9169144
1/15/2001 91.6175245
7/15/2001 90.2230831
1/15/2002 87.8022117
7/15/2002 86.3380175
1/15/2003 83.7888657
7/15/2003 82.2508222
1/15/2004 79.5667924
7/15/2004 77.9527950
1/15/2005 75.1293462
SCHEDULE 2
to
AMENDMENT NO. 1
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
12/30/1985 103.0588289 5/30/1989 116.4477567
1/30/1986 103.7923344 6/30/1989 117.3018730
2/30/1986 104.8971263 7/30/1989 113.6020990
3/30/1986 105.9917542 8/30/1989 114.4759270
4/30/1986 107.0426922 9/30/1989 115.3137944
5/30/1986 108.1278120 10/30/1989 116.1738092
6/30/1086 109.1610390 11/30/1989 117.0367257
7/30/1986 106.4046445 12/30/1989 117.8635975
8/30/1086 107.4943009 1/30/1990 114.1360496
9/30/1986 108.5322101 2/30/1990 114.9817059
10/30/1986 109.6035084
11/30/1986 110.6800137
12/30/1986 111.7037517
1/30/1987 108.1973982
2/30/1987 109.2430627
3/30/1987 110.2680052
4/30/1987 111.2613874
5/30/1987 112.2835284
6/30/1987 113.2612975
7/30/1987 109.6713452
8/30/1987 110.6691026
9/30/1987 111.6223008
10/30/1987 112,6037248
11/30/1987 113.5892757
12/30/1987 114.5301317
1/30/1988 110.9230965
2/30/1988 111.8909093
3/30/1988 112.8409945
4/30/1988 113.7658191
5/30/1988 114.7141103
6/30/1988 115.6262660
7/30/1988 111.9856774
8/30/1988 112.9194747
9/30/1988 113.8172844
10/30/1988 114.7381525
11/30/1988 115.6625315
12/30/1988 116.5508531
1/30/1989 112.8859043
2/30/1989 113.7950233
3/30/1989 114.6898951
4/30/1989 115.5575279
PUBLIC SERVICE COMPANY OF NEW MEXICO UNIT 1
Basic Basic Basic
Rent Percentage Rent Percentage Rent Percentage
Payment of Facility Payment Facility Payment of Facility
Date Cost Date Cost Date Cost
---- ---- ---- ---- ---- ----
12/30/2002 84.1549965 3/30/2007 60.8010191 6/30/2011 37.2438571
1/30/2002 80.2852074 4/30/2007 61.1255136 7/30/2011 32.9061843
2/30/2003 80.6651963 5/30/2007 61.4365804 8/30/2011 33.1276222
3/30/2003 80.7182764 6/30/2007 61.7764532 9/30/2011 33.3880555
4/30/2003 81.1219511 7/30/2007 57.4524084 10/30/2011 33.6315938
5/30/2003 81.5148273 8/30/2007 57.7307275 11/30/2011 33.8768170
6/30/2003 81.9306252 9/30/2007 58.0382460 12/30/2011 34.1616107
7/30/2002 78.5870581 10/30/2007 58.3319272 1/30/2012 29.8377510
8/30/2003 78.9602796 11/30/2007 58.6260648 2/30/2012 30.0727675
9/30/2003 78.4586946 12/30/2007 58.9497026 3/30/2012 30.3261358
10/30/2003 78.8331087 1/30/2008 54.6183102 4/30/2012 30.6131522
11/30/2003 79.2077209 2/30/2008 54.8827187 5/30/2012 30.8829984
12/30/2003 79.6055938 3/30/2008 55.1601300 6/30/2012 31.1950184
1/30/2004 75.7324981 4/30/2008 55.4614318 7/30/2012 26.8972285
2/30/2004 76.0917968 5/30/2008 55.7485590 8/30/2012 27.1582177
3/30/2004 76.1066169 6/30/2008 56.0661201 9/30/2012 27.4635357
4/30/2004 76.4909708 7/30/2008 51.7146639 10/30/2012 27.7513591
5/30/2004 76.8639177 8/30/2008 51.9672357 11/30/2012 28.0422598
6/30/2004 77.2610948 9/30/2008 52.2506558 12/30/2012 28.3781693
7/30/2004 73.9447211 10/30/2008 52.5194695 1/30/2013 23.9710573
8/30/2004 74.2969169 11/30/2008 52.7887736 2/30/2013 24.2071394
9/30/2004 73.7250314 12/30/2008 53.0892439 3/30/2013 24.4638829
10/30/2004 74.0785035 1/30/2009 48.7301015 4/30/2013 24.7568327
11/30/2004 74.4321905 2/30/2009 48.9680452 5/30/2013 25.0318253
12/30/2004 74.8104651 3/30/2009 49.2197313 6/30/2013 25.3523356
1/30/2005 70.9362855 4/30/2009 49.4966581 7/30/2013 20.8753173
2/30/2005 71.2738234 5/30/2009 49.7586230 8/30/2013 21.0756993
3/30/2005 71.2459504 6/30/2009 50.0527397 9/30/2013 21.3207056
4/30/2005 71.6099603 7/30/2009 45.6724792 10/30/2013 21.5471233
5/30/2005 71.9619216 8/30/2009 45.8979902 11/30/2013 21.7759750
6/30/2005 72.3394936 9/30/2009 46.1560906 12/30/2013 22.0497917
7/30/2005 68.0730056 10/30/2009 46.3987735 1/30/2014 17.5254847
8/30/2005 68.3991238 11/30/2009 46.6419836 2/30/2014 17.6779874
9/30/2005 68.7513806 12/30/2009 46.9181187 3/30/2014 17.8508931
10/30/2005 69.0912309 1/30/2010 42.5298259 4/30/2014 18.0586319
11/30/2005 69.4314766 2/30/2010 42.7399638 5/30/2014 18.2473113
12/30/2005 69.7981485 3/30/2010 42.9646252 6/30/2014 18.4804514
1/30/2006 65.5182775 4/30/2010 43.2159533 7/30/2014 13.9149576
2/30/2006 65.8318202 5/30/2010 43.4514896 8/30/2014 14.0257567
3/30/2006 66.1569719 6/30/2010 43.7209919 9/30/2014 14.1800593
4/30/2006 66.5035386 7/30/2010 39.3115246 10/30/2014 14.3146384
5/30/2006 66.8373860 8/30/2010 39.5089879 11/30/2014 14.4505026
6/30/2006 67.1984976 9/30/2010 39.7408968 1/15/2015 10.00000000
7/30/2006 62.9005129 10/30/2010 39.9565359
8/30/2006 63.2033238 11/30/2010 40.1727495
9/30/2006 63.5337717 12/30/2010 40.4237658
10/30/2006 63.8511120 1/30/2011 36.0685335
11/30/2006 64.1688770 2/30/2011 36.2725758
12/30/2006 64.5145639 3/30/2011 36.4924178
1/30/2007 60.2095553 4/30/2011 36.7415607
2/30/2007 60.4991358 5/30/2011 36.9741664
PUBLIC SERVICE COMPANY OF NEW MEXICO UNIT 1
Basic Basic Basic
Rent Percentage Rent Percentage Rent Percentage
Payment of Facility Payment of Facility Payment of Facility
Date Cost Date Cost Date Cost
---- ---- ---- ---- ---- ----
3/30/1990 115.8127529 6/30/1994 118.7185007 9/30/1998 98.7191253
4/30/1990 116.6164370 7/30/1994 114.7053342 10/30/1998 99.1836346
5/30/1990 117.4417493 8/30/1994 115.2593247 11/30/1998 99.6482756
6/30/1990 118.2309505 9/30/1994 117.0587606 12/30/1998 100.1305252
7/30/1990 114.4650598 10/30/1994 117.6129279 1/30/1999 96.2683714
8/30/1990 115.2718567 11/30/1994 118.1671845 2/30/1999 96.7212981
9/30/1990 116.0426987 12/30/1994 119.9634413 3/30/1999 96.9133184
10/30/1990 116.8346756 1/30/1995 115.9405816 4/30/1999 97.3851756
11/30/1990 117.6288686 2/30/1995 116.4850345 5/30/1999 97.8483679
12/30/1990 118.3870062 3/30/1995 117.5872129 6/30/1999 98.3299062
1/30/1991 114.5894174 4/30/1995 117.7524901 7/30/1999 94.8909132
2/30/1991 115.3640914 5/30/1995 118.2972203 8/30/1999 95.3382772
3/30/1991 116.1237373 6/30/1995 118.4608819 9/30/1999 95.0840806
4/30/1991 116.8602001 7/30/1995 114.4272433 10/30/1999 95.5323608
5/30/1991 117.6150972 8/30/1995 114.9617173 11/30/1999 95.9807840
6/30/1991 118.3382255 9/30/1995 114.9557537 12/30/1999 96.4478272
7/30/1991 114.5027974 10/30/1995 115.4904197 1/30/2000 92.5846993
8/30/1991 115.2391186 11/30/1995 116.0251828 2/30/2000 93.0207655
9/30/1991 115.9438590 12/30/1995 116.0157395 3/30/2000 93.1798883
10/30/1991 116.6665461 1/30/1996 111.9723237 4/30/2000 93.6359865
11/30/1991 117.3907609 2/30/1996 112.4963634 5/30/2000 94.0829283
12/30/1991 118.0833047 3/30/1996 112.8154630 6/30/2000 94.5492687
1/30/1992 114.2162646 4/30/1996 112.7730131 7/30/2000 91.1324130
2/30/1992 114.9202294 5/30/1996 113.2973541 8/30/2000 91.5626405
3/30/1992 115.6107262 6/30/1996 113.2531361 9/30/2000 91.2511704
4/30/1992 116.2770454 7/30/1996 109.1992437 10/30/2000 91.6823733
5/30/1992 116.9607136 8/30/1996 109.7123720 11/30/2000 92.1137312
6/30/1992 117.6127239 9/30/1996 109.6335828 12/30/2000 92.5647764
7/30/1992 113.7043410 10/30/1996 110.1469197 1/30/2001 88.6994113
8/30/1992 114.3663954 11/30/1996 110.6603621 2/30/2001 89.1177331
9/30/1992 114.9970243 12/30/1996 110.5777674 3/30/2001 89.2434354
10/30/1992 115.6444469 1/30/1997 106.5121035 4/30/2001 89.6829422
11/30/1992 116.2926665 2/30/1997 107.0122704 5/30/2001 90.1127742
12/30/1992 116.9093610 3/30/1997 107.2543773 6/30/2001 90.5631159
1/30/1993 112.9649228 4/30/1997 107.1309959 7/30/2001 87.1690624
2/30/1993 113.5903921 5/30/1997 107.6314901 8/30/2001 87.5812494
3/30/1993 114.2020066 6/30/1997 107.5058970 9/30/2001 87.2100140
4/30/1993 114.7894113 7/30/1997 103.4261335 10/30/2001 87.6232475
5/30/1993 115.3929380 8/30/1997 103.9126619 11/30/2001 88.0366492
6/30/1993 115.9649496 9/30/1997 103.7441158 12/30/2001 88.4708653
7/30/1993 111.9749265 10/30/1997 104.2308709 1/30/2002 84.6032660
8/30/1993 112.5541938 11/30/1997 104.7177404 2/30/2002 85.0029110
9/30/1993 113.7975464 12/30/1997 104.5444217 3/30/2002 85.0933045
10/30/1993 114.3695393 1/30/1998 100.4521334 4/30/2002 85.5153514
11/30/1993 114.9416143 2/30/1998 100.9243217 5/30/2002 85.9271766
12/30/1993 116.7990391 3/30/1998 101.1115772 6/30/2002 86.3606848
1/30/1994 112.7942485 4/30/1998 100.9416046 7/30/2002 82.9915632
2/30/1994 113.3573574 5/30/1998 101.4147395 8/30/2002 83.3847667
3/30/1994 114.4969708 6/30/1998 101.9049255 9/30/2002 82.9496808
4/30/1994 116.3267919 7/30/1998 98.4546107 10/30/2002 83.3439963
5/30/1994 116.8901562 8/30/1998 98.9182646 11/30/2002 83.7384943
SCHEDULE 3
to
AMENDMENT NO. 1
SCHEDULE OF TERMINATION VALUES
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
- ---- ---- ---- ----
7/15/1986 105.6802338 7/15/2005 67.9242911
1/15/1987 107.4753404 1/15/2006 65.3772083
7/15/1987 108.9908282 7/15/2006 62.7716897
1/15/1988 110.2590532 1/15/2007 60.0827526
7/15/1988 111.3529705 7/15/2007 57.3384734
1/15/1989 112.2752465 1/15/2008 54.5064650
7/15/1989 113.0238617 7/15/2008 51.6163938
1/15/1990 113.5830816 1/15/2009 48.6339944
7/15/1990 113.9478241 7/15/2009 45.5906667
1/15/1991 114.1011603 1/15/2010 42.4502425
7/15/1991 114.0495482 7/15/2010 39.2459388
1/15/1992 113.7916781 1/15/2011 35.9425111
7/15/1992 113.3177017 7/15/2011 32.7488097
1/15/1993 112.6107885 1/15/2012 29.6520508
7/15/1993 111.6626619 7/15/2012 26.6701878
1/15/1994 112.4939685 1/15/2013 23.8372717
7/15/1994 114.4099193 7/15/2013 20.8075384
1/15/1995 115.6502554 1/15/2014 17.5061945
7/15/1995 114.1422412 7/15/2014 13.9381049
1/15/1996 111.6928886 1/15/2015 10.00000000
7/15/1996 108.9256303
1/15/1997 106.2454052
7/15/1997 103.1667114
7/15/1998 100.2003619
1/15/1998 98.2073936
7/15/1999 96.0268782
1/15/1999 94.6523896
7/15/2000 92.3522041
1/15/2000 90.9030350
7/15/2001 88.4763863
1/15/2001 86.9493125
7/15/2002 84.3902087
1/15/2002 82.7819452
7/15/2003 80.0826409
1/15/2003 78.3881048
7/15/2004 75.5409746
1/15/2004 73.7569900
7/15/2005 70.7563765
EXHIBIT 28.1
When Recorded, Return to: Gregg R. Neilsen
Snell & Wilmer
3100 Valley Bank Center
Phoenix, Arizona 85073
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS HERETOFORE
AMENDED AND AS AMENDED BY THIS AMENDMENT NO. 2 THERETO HAVE BEEN ASSIGNED TO,
AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF, CHEMICAL BANK, AS INDENTURE
TRUSTEE UNDER A TRUST INDENTURE, MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF
RENTS DATED AS OF DECEMBER 16, 1985, AS AMENDED. THIS AMENDMENT NO. 2 HAS BEEN
EXECUTED IN SEVERAL COUNTERPARTS. SEE SECTION 3(e) OF THIS AMENDMENT NO. 2 FOR
INFORMATION CONCERNING THE RIGHTS OF HOLDERS OF VARIOUS COUNTERPARTS HEREOF AND
OF THE FACILITY LEASE.
THIS COUNTERPART IS NOT THE ORIGINAL COUNTERPART.
================================================================================
AMENDMENT NO. 2
Dated as of November 18, 1986
to
FACILITY LEASE
Dated as of December 16, 1985, as amended
between
THE FIRST NATIONAL BANK OF BOSTON
not in its individual capacity,
but solely as Owner Trustee under
a Trust Agreement, dated as of
December 16, 1985, with Burnham
Leasing Corporation
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
================================================================================
Original Facility Lease recorded December 31, 1985,
as Instrument No. 85-623268, re-recorded April 17,
1986, as Instrument No. 86-187558 confirmed by docu-
ment recorded April 25, 1986, as Instrument No.
86-203239, and amended by Amendment No. 1 thereto
recorded July 17, 1986, as Instrument No. 86-367462,
in Maricopa County, Arizona Recorder's Office.
================================================================================
6091.BURNHAMU1.DEBT.71:1
AMENDMENT NO. 2 dated as of November 18, 1986 (Amendment No.
2), to the Facility Lease dated as of December 16, 1985, as heretofore amended
between THE FIRST NATIONAL BANK OF BOSTON, a national banking association, not
in its individual capacity, but solely as Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with Burnham Leasing Corporation (the Lessor),
and PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessee and the Lessor have heretofore entered
into a Facility Lease dated as of December 16, 1985 as heretofore amended (the
Facility Lease), providing for the lease by the Lessor to the Lessee of the
Undivided Interest and the Real Property Interest;
WHEREAS, Section 3(e) of the Facility Lease provides for an
adjustment to Basic Rent and to the schedules of Casualty Values, Special
Casualty Values and Termination Values in the event, among other things, that a
Releveraging Note is issued; and
WHEREAS, a Releveraging Note is being issued pursuant to
Supplemental Indenture No. 2 dated as of November 18, 1986, to the Indenture;
WHEREAS, Section 3(d) of the Facility Lease provides for an
adjustment to Basic Rent and to the schedules of Casualty Values, Special
Casualty Values and Termination Values in the event of a Change in Tax Law;
WHEREAS, a Change in Tax Law has occurred; and
WHEREAS, pursuant to Amendment No. 2 to the Participation
Agreement and the Indenture, the Trustee has consented to this Amendment No. 2;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
6091.BURNHAMU1.DEBT.71:1
- 1 -
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein or in the recitals shall have the meanings assigned to
such terms in Appendix A to the Facility Lease.
SECTION 2. Amendments.
(a) Section 3(a)(ii) of the Facility Lease is amended to read
in its entirety as follows:
"(ii) (1) on July 15, 1986 an amount equal to 4.3683233% of
Facility Cost and (2) on January 15, 1987 and on each Basic Rent
Payment Date thereafter to and including January 15, 2015, an amount
equal to 4.70354% of Facility Cost; and".
(b) Section 3(e)(iii) of the Facility Lease is hereby amended
to replace "1.1% of the Purchase Price" with "1.7% of the Purchase Price".
(c) Section 3(e)(iv) of the Facility Lease is hereby amended
(x) to insert "(except for a change in items 4, 5, 8 (as to the basis for
amortization of Transaction Expenses) 15, 16 and 18 that arises from a change in
tax law; provided, however, that this exception will not limit the effect of
Section 3(d) hereof)" immediately following the word "change" and (y) to insert
the phrase "Current Pricing Assumptions" in lieu of the phrase "pricing
assumptions set forth in Schedule 2 to the Participation Agreement".
(d) Section 3(e) of the Facility Lease is hereby amended to
insert at the end thereof the following new sentence: "Current Pricing
Assumptions shall mean the assumptions attached to the letter from the Lessee to
the Owner Participant dated November 25, 1986, as such letter may be replaced
from time to time with the consent of the Owner Participant."
(e) Schedule 1 to Amendment No. 1 to the Facility Lease
(Schedule of Casualty Values), is hereby replaced with Schedule 1 hereto.
(f) Schedule 2 to Amendment No. 1 to the Facility Lease
(Schedule of Special Casualty Values), is hereby replaced with Schedule 2
hereto.
6091.BURNHAMU1.DEBT.71:1
- 2 -
(g) Schedule 3 to Amendment No. 1 to the Facility Lease
(Schedule of Termination Values), is hereby replaced with Schedule 3 hereto.
SECTION 3. Miscellaneous.
(a) Effective Date of Amendments. The amend- ments set forth
in Section 2 hereof shall be and become effective upon the execution hereof by
the parties hereto.
(b) Counterpart Execution. This Amendment No. 2 may be
executed in any number of counterparts and by each of the parties hereto on
separate counterparts; all such counterparts shall together constitute but one
and the same instrument.
(c) Governing Law. This Amendment No. 2 has been negotiated
and delivered in the State of New York and shall be governed by, and be
construed in accordance with, the laws of the State of New York, except to the
extent that pursuant to the law of the State of Arizona such law is mandatorily
applicable hereto.
(d) Disclosure. Pursuant to Arizona Revised Statutes Section
33-401, the beneficiary of the Trust Agreement is Burnham Leasing Corporation, a
New York corporation. The address of the beneficiary is 60 Broad Street, New
York, New York 10004, Attention: Assistant Treasurer. A copy of the Trust
Agreement is available for inspection at the offices of the Owner Trustee at 100
Federal Street, Boston, Massachusetts 02110, Attention of Corporate Trust
Division.
(e) Amendment No. 2. The single executed orig- inal of this
Amendment No. 2 marked "THIS COUNTERPART IS THE ORIGINAL COUNTERPART" and
containing the receipt of the Indenture Trustee thereon shall be the "Original"
of this Amendment No. 2. To the extent that the Facility Lease constitutes
chattel paper, as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest in the Facility
Lease as amended by this Amendment No. 2 may be created or continued through the
transfer or possession of any counterpart of this Amendment No. 2 other than the
"Original".
(f) The Facility Lease. The Facility Lease, as amended, is a
lease of the property described in and conveyed to the Lessor by (i) the Deed
6091.BURNHAMU1.DEBT.71:1
- 3 -
and Bill of Sale recorded December 31, 1985 as Instrument No. 85-623265, (ii)
the Deed recorded December 31, 1985 as Instrument No. 85-623266, and (iii) the
Deed an Assignment of Beneficial Interest dated December 31, 1985 with respect
to Title USA Company of Arizona Trust No. 530 (as reflected in Affidavit of
Trustee recorded December 31, 1985 as Instrument No. 85-623286), all in the
records of Maricopa County Recorder's Office, the legal descriptions of such
property being incorporated herein by this reference, which property is the
Undivided Interest and the Real Property Interest subject to the Facility Lease.
6091.BURNHAMU1.DEBT.71:1
- 4 -
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 2 to Facility Lease to be duly executed in New York, New York by
an officer thereunto duly authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with
Burnham Leasing Corporation
By: /S/
Authorized Officer
PUBLIC SERVICE COMPANY OF NEW
MEXICO,
By: _______________________________
B.D. Lackey
Vice President and
Corporate Controller
6091.BURNHAMU1.DEBT.71:1
- 5 -
State of New York )
) ss.
County of New York )
The foregoing instrument was acknowledged before me this 24th
day of November, 1986, by B.D. LACKEY, the Vice President and Corporate
Controller of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation, on
behalf of the corporation.
/S/ Delia T. Santiago
Notary Public
State of New York )
) ss.
County of New York )
The foregoing instrument was acknowledged before me this 16th
day of November, 1986 by Martin P. Henry, an Assistant Vice President of THE
FIRST NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Burnham Leasing Corporation.
/S/ David A. Spivak
Notary Public
6091.BURNHAMU1.DEBT.71:1
SCHEDULE 1
to
AMENDMENT NO. 2
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
7/15/1986 106.4518467 1/15/2005 72.3307960
1/15/1987 105.4650524 7/15/2005 70.4213019
7/15/1987 106.5112367 1/15/2006 68.4489361
1/15/1988 104.0277290 7/15/2006 66.4145594
7/15/1988 104.6099981 1/15/2007 64.2963730
1/15/1989 105.0871009 7/15/2007 62.1154375
7/15/1989 105.4593212 1/15/2008 59.8430745
1/15/1990 105.7172712 7/15/2008 57.5008480
7/15/1990 105.8582489 1/15/2009 55.0587786
1/15/1991 105.8721938 7/15/2009 52.5391836
7/15/1991 105.7636214 1/15/2010 49.9100924
1/15/1992 105.5322749 7/15/2010 47.1947679
7/15/1992 105.1710850 1/15/2011 44.3613272
1/15/1993 104.6701325 7/15/2011 41.3668272
7/15/1993 104.0248972 1/15/2012 38.7931788
1/15/1994 103.2247011 7/15/2012 36.0501745
7/15/1994 102.2640136 1/15/2013 33.4464656
1/15/1995 101.2202252 7/15/2013 27.2579072
7/15/1995 99.9075530 1/15/2014 23.7924770
1/15/1996 96.6558769 7/15/2014 20.6510073
7/15/1996 97.4026782 1/15/2015
1/15/1997 96.1548205
7/15/1997 94.9069467
1/15/1998 93.6659207
7/15/1998 92.4358234
1/15/1999 91.1586840
7/15/1999 89.8656106
1/15/2000 88.4993884
7/15/2000 87.1233160
1/15/2001 85.6689341
7/15/2001 84.2031059
1/15/2002 82.6533673
7/15/2002 81.0902492
1/15/2003 79.4370651
7/15/2003 77.7682653
1/15/2004 76.0026833
7/15/2004 74.2188324
6091.BURNHAMU1.DEBT.11:2
SCHEDULE 2
to
AMENDMENT NO. 2
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
12/30/1985 102.7542310 11/30/1988 107.3861219
1/30/1986 103.4952377 12/30/1988 108.2252291
2/30/1986 104.6078078 1/30/1989 104.3721936
3/30/1986 105.7108970 2/30/1989 105.2227569
4/30/1986 106.7688424 3/30/1989 106.0648901
5/30/1986 107.8619358 4/30/1989 106.8905469
6/30/1086 108.9018907 5/30/1989 107.7306007
7/30/1986 106.1524169 6/30/1989 108.5486893
8/30/1086 107.2495920 7/30/1989 104.6742270
9/30/1986 108.2948285 8/30/1989 105.5030562
10/30/1986 109.3738757 9/30/1989 106.3100259
11/30/1986 110.3486578 10/30/1989 107.1311334
12/30/1986 111.3422972 11/30/1989 107.9544649
1/30/1987 105.0370031 12/30/1989 108.7558981
2/30/1987 106.0146695 1/30/1990 104.8644349
3/30/1987 106.9727922 2/30/1990 105.6759956
4/30/1987 107.9070757 3/30/1990 106.4789497
5/30/1987 108.8643302 4/30/1990 107.2653992
6/30/1987 109.7860350 5/30/1990 108.0656946
7/30/1987 106.0034229 6/30/1990 108.8440754
8/30/1987 106.9411928 7/30/1990 104.9291197
9/30/1987 107.8412366 8/30/1990 105.7168476
10/30/1987 108.7637925 9/30/1990 106.4827708
11/30/1987 109.6895801 10/30/1990 107.2622556
12/30/1987 110.5795269 11/30/1990 108.0435915
1/30/1988 103.4415899 12/30/1990 108.8030753
2/30/1988 104.3295725 1/30/1991 104.8688029
3/30/1988 105.2045795 2/30/1991 105.6369351
4/30/1988 106.0654587 3/30/1991 106.3962554
5/30/1988 106.9412314 4/30/1991 107.1417191
6/30/1988 107.7949807 5/30/1991 107.8991040
7/30/1988 103.9569412 6/30/1991 108.6373247
8/30/1988 104.8227101 7/30/1991 104.6800108
9/30/1988 105.6665574 8/30/1991 105.4247639
10/30/1988 106.5250618
6091.BURNHAMU1.DEBT.11:2
Page 1 of 5
SCHEDULE 2
to
AMENDMENT NO. 2
SCHEDULE OF SPECIAL CASUALTY VALUES
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
9/30/1991 106.1504846 11/30/1994 102.9714486
10/30/1991 106.8878496 12/30/1994 103.6158088
11/30/1991 107.6266990 1/30/1995 99.4920797
12/30/1991 108.3464775 2/30/1995 100.0576103
1/30/1992 104.3699150 3/30/1995 100.9598708
2/30/1992 105.0948215 4/30/1995 101.2948499
3/30/1992 105.8119470 5/30/1995 101.8606539
4/30/1992 106.5146636 6/30/1995 102.2347013
5/30/1992 107.2286934 7/30/1995 98.0918042
6/30/1992 107.9236935 8/30/1995 98.6477409
7/30/1992 103.9218114 9/30/1995 99.2119925
8/30/1992 104.6210185 10/30/1995 99.7723369
9/30/1992 105.3013575 11/30/1995 100.3328385
10/30/1992 105.9926942 12/30/1995 100.9017657
11/30/1992 106.6851316 1/30/1996 96.7571646
12/30/1992 107.3386585 2/30/1996 97.3112887
1/30/1993 103.3348127 3/30/1996 97.8687424
2/30/1993 104.0116958 4/30/1996 98.4335007
3/30/1993 104.6806310 5/30/1996 98.9942961
4/30/1993 105.3352104 6/30/1996 99.5640259
5/30/1993 106.0004160 7/30/1996 95.4199158
6/30/1993 106.6467554 8/30/1996 95.9744426
7/30/1993 102.5951179 9/30/1996 96.5383215
8/30/1993 103.2438009 10/30/1996 97.0981759
9/30/1993 103.8737902 11/30/1996 97.6584525
10/30/1993 104.5140593 12/30/1996 98.2282138
11/30/1993 105.1550022 1/30/1997 94.0829564
12/30/1993 105.7771970 2/30/1997 94.6355097
1/30/1994 101.7008528 3/30/1997 95.1924846
2/30/1994 102.3244396 4/30/1997 95.7575271
3/30/1994 102.9398914 5/30/1997 96.3184853
4/30/1994 103.5410327 6/30/1997 96.8895581
5/30/1994 104.1520389 7/30/1997 92.7452084
6/30/1994 104.7443471 8/30/1997 93.2985153
7/30/1994 100.6374641 9/30/1997 93.8624570
8/30/1994 101.2300504 10/30/1997 94.4222385
9/30/1994 101.8041551 11/30/1997 94.9827830
10/30/1994 102.3876948 12/30/1997 95.5541283
6091.BURNHAMU1.DEBT.11:2
Page 2 of 5
SCHEDULE 2
to
AMENDMENT NO. 2
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
1/30/1998 91.4095520 2/30/2001 83.1945370
2/30/1998 91.9624841 3/30/2001 83.7100504
3/30/1998 92.5206088 4/30/2001 84.2365386
4/30/1998 93.0879868 5/30/2001 84.7579923
5/30/1998 93.6511613 6/30/2001 85.2931965
6/30/1998 94.2258566 7/30/2001 81.0638904
7/30/1998 90.0587394 8/30/2001 81.5615927
8/30/1998 90.6061628 9/30/2001 82.0730587
9/30/1998 91.1653160 10/30/2001 82.5792563
10/30/1998 91.7201086 11/30/2001 83.0865199
11/30/1998 92.2758974 12/30/2001 83.6077022
12/30/1998 92.8435688 1/30/2002 79.3875913
1/30/1999 88.6758122 2/30/2002 79.8782822
2/30/1999 89.2178183 3/30/2002 80.3756506
3/30/1999 89.7655484 4/30/2002 80.8845744
4/30/1999 90.3231803 5/30/2002 81.3881339
5/30/1999 90.8763696 6/30/2002 81.9061812
6/30/1999 91.4419321 7/30/2002 77.6562150
7/30/1999 87.2494322 8/30/2002 78.1345529
8/30/1999 87.7815320 9/30/2002 78.6273903
9/30/1999 88.3260203 10/30/2002 79.1146137
10/30/1999 88.8658606 11/30/2002 79.6029164
11/30/1999 89.4067242 12/30/2002 80.1058807
12/30/1999 89.9601180 1/30/2003 75.8653785
1/30/2000 85.7762220 2/30/2003 76.3360404
2/30/2000 86.3024327 3/30/2003 76.8137097
3/30/2000 86.8346937 4/30/2003 77.3035400
4/30/2000 87.3773736 5/30/2003 77.7876507
5/30/2000 87.9153256 6/30/2003 78.2870200
6/30/2000 88.4663236 7/30/2003 74.0146875
7/30/2000 84.2561120 8/30/2003 74.4720081
8/30/2000 84.7716834 9/30/2003 74.9445974
9/30/2000 85.3003149 10/30/2003 75.4112001
10/30/2000 85.8239993 11/30/2003 75.8788887
11/30/2000 86.3487305 12/30/2003 76.3620151
12/30/2000 86.8866703 1/30/2004 72.0993762
1/30/2001 82.6853819 2/30/2004 72.5482737
6091.BURNHAMU1.DEBT.11:2
Page 3 of 5
SCHEDULE 2
to
AMENDMENT NO. 2
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
3/30/2004 73.0045186 4/30/2007 60.3747600
4/30/2004 73.4730509 5/30/2007 60.7655813
5/30/2004 73.9364902 6/30/2007 61.1752418
6/30/2004 74.4154887 7/30/2007 56.8077588
7/30/2004 70.1188601 8/30/2007 57.1682150
8/30/2004 70.5533154 9/30/2007 57.5476840
9/30/2004 71.0038427 10/30/2007 57.9194339
10/30/2004 71.4479811 11/30/2007 58.2923563
11/30/2004 71.8932032 12/30/2007 58.6845124
12/30/2004 72.3546734 1/30/2008 54.3068099
1/30/2005 68.0679036 2/30/2008 54.6513134
2/30/2005 68.4930799 3/30/2008 55.0047423
3/30/2005 68.9259528 4/30/2008 55.3738747
4/30/2005 69.3722741 5/30/2008 55.7350693
5/30/2005 69.8120779 6/30/2008 56.1160563
6/30/2005 70.2687886 7/30/2008 51.7156640
7/30/2005 65.9646993 8/30/2008 52.0444855
8/30/2005 66.3803907 9/30/2008 52.3932782
9/30/2005 66.8132731 10/30/2008 52.7338096
10/30/2005 67.2394018 11/30/2008 53.0754684
11/30/2005 67.6667438 12/30/2008 53.4373277
12/30/2005 68.1114926 1/30/2009 49.0255076
1/30/2006 63.7934138 2/30/2009 49.3368286
2/30/2006 64.1957571 3/30/2009 49.6574593
3/30/2006 64.6062534 4/30/2009 49.9945557
4/30/2006 65.0310108 5/30/2009 50.3231497
5/30/2006 65.4488770 6/30/2009 50.6725248
6/30/2006 65.8845650 7/30/2009 46.2360503
7/30/2006 61.5471496 8/30/2009 46.5301055
8/30/2006 61.9364581 9/30/2009 46.8451255
9/30/2006 62.3438562 10/30/2009 47.1512939
10/30/2006 62.7440346 11/30/2009 47.4585240
11/30/2006 63.1454130 12/30/2009 47.7869559
12/30/2006 63.5650940 1/30/2010 43.3376742
1/30/2007 59.2185145 2/30/2010 43.6124904
2/30/2007 59.5932443 3/30/2010 43.8970027
3/30/2007 59.9765196
6091.BURNHAMU1.DEBT.11:2
Page 4 of 5
SCHEDULE 2
to
AMENDMENT NO. 2
SCHEDULE OF SPECIAL CASUALTY VALUES
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
4/30/2010 44.1987658 5/30/2013 25.9554947
5/30/2010 44.4914112 6/30/2013 26.2400600
6/30/2010 44.8058611 7/30/2013 21.6371751
7/30/2010 40.3305967 8/30/2013 21.8253254
8/30/2010 40.5866417 9/30/2013 22.0416242
9/30/2010 40.8646922 10/30/2013 22.2468204
10/30/2010 41.1332506 11/30/2013 22.4539730
11/30/2010 41.4027867 12/30/2013 22.6895049
12/30/2010 41.6945747 1/30/2014 18.0369516
1/30/2011 37.2563200 2/30/2014 18.1747973
2/30/2011 37.5081100 3/30/2014 18.3254751
3/30/2011 37.7703691 4/30/2014 18.4979519
4/30/2011 38.0514945 5/30/2014 18.6587608
5/30/2011 38.3230213 6/30/2014 18.8473546
6/30/2011 38.6182686 7/30/2014 14.1472611
7/30/2011 34.1825064 8/30/2014 14.2369575
8/30/2011 34.4364524 9/30/2014 14.3535414
9/30/2011 34.7153309 10/30/2014 14.4577454
10/30/2011 34.9844358 11/30/2014 14.5626126
11/30/2011 35.2553148 12/30/2014 14.6943496
12/30/2011 35.5515126
1/30/2012 31.1156137
2/30/2012 31.3690299
3/30/2012 31.6346125
4/30/2012 31.9218743
5/30/2012 32.1992631
6/30/2012 32.5036487
7/30/2012 28.0749204
8/30/2012 28.3351926
9/30/2012 28.6238310
10/30/2012 28.9024516
11/30/2012 29.1838391
12/30/2012 29.4940500
1/30/2013 24.9617093
2/30/2013 25.1910404
3/30/2013 25.4338865
4/30/2013 25.6999140
6091.BURNHAMU1.DEBT.11:2
Page 5 of 5
SCHEDULE 3
to
AMENDMENT NO. 2
SCHEDULE OF TERMINATION VALUES
Basic Basic
Rent Percentage Rent Percentage
Payment of Facility Payment of Facility
Date Cost Date Cost
---- ---- ---- ----
7/15/1986 103.4212361 1/15/2005 67.8255614
1/15/1987 104.3925241 7/15/2005 65.7328276
7/15/1987 105.3950859 1/15/2006 63.5697692
1/15/1988 102.8661814 7/15/2006 61.3369441
7/15/1988 103.4012074 1/15/2007 59.0124377
1/15/1989 103.8291454 7/15/2007 56.6163826
7/15/1989 104.1502014 1/15/2008 54.1203585
1/15/1990 104.3549060 7/15/2008 51.5453742
7/15/1990 104.4404728 1/15/2009 48.8610801
1/15/1991 104.3967530 7/15/2009 46.0894084
7/15/1991 104.2281706 1/15/2010 43.1979879
1/15/1992 103.9343733 7/15/2010 40.2096646
7/15/1992 103.5081925 1/15/2011 37.0921214
1/15/1993 102.9396058 7/15/2011 34.0019638
7/15/1993 102.2239855 1/15/2012 30.9206325
1/15/1994 101.3505415 7/15/2012 27.8574311
7/15/1994 100.3136271 1/15/2013 24.8316940
1/15/1995 99.1905114 7/15/2013 21.5737285
7/15/1995 97.7952853 1/15/2014 18.0242927
1/15/1996 96.4576977 7/15/2014 14.1833071
7/15/1996 95.1150933 1/15/2015 10.6510073
1/15/1997 93.7741936
7/15/1997 92.4294935
1/15/1998 91.0877029
7/15/1998 89.7527428
1/15/1999 88.3664754
7/15/1999 86.9598355
1/15/2000 85.4754279
7/15/2000 83.9763631
1/15/2001 82.3939863
7/15/2001 80.7949574
1/15/2002 79.1066005
7/15/2002 77.3992261
1/15/2003 75.5959184
7/15/2003 73.7708891
1/15/2004 71.8427233
7/15/2004 69.8896959
6091.BURNHAMU1.DEBT.11:2
EXHIBIT 10.21.3
When Recorded, Return to: Gregg R. Neilsen
Snell & Wilmer
3100 Valley Bank Center
Phoenix, Arizona 85073
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS
HERETOFORE AMENDED AND AS AMENDED BY THIS AMENDMENT NO. 2 THERETO HAVE
BEEN ASSIGNED TO, AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF,
CHEMICAL BANK, AS INDENTURE TRUSTEE UNDER A TRUST INDENTURE, MORTGAGE,
SECURITY AGREEMENT AND ASSIGNMENT OF RENTS DATED AS OF DECEMBER 16,
1985, AS AMENDED. THIS AMENDMENT NO. 3 HAS BEEN EXECUTED IN SEVERAL
COUNTERPARTS. SEE SECTION 3(e) OF THIS AMENDMENT NO. 3 FOR INFORMATION
CONCERNING THE RIGHTS OF HOLDERS OF VARIOUS COUNTERPARTS HEREOF AND OF
THE FACILITY LEASE.
THIS COUNTERPART IS NOT THE ORIGINAL COUNTERPART.
================================================================================
AMENDMENT NO. 3
Dated as of March 30, 1987
to
FACILITY LEASE
Dated as of December 16, 1985, as amended
between
THE FIRST NATIONAL BANK OF BOSTON
not in its individual capacity,
but solely as Owner Trustee under
a Trust Agreement, dated as of
December 16, 1985, with Burnham
Leasing Corporation,
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
================================================================================
Original Facility Lease recorded December 31, 1985, as
Instrument No. 85-623268, re-recorded April 17, 1986, as Instrument No.
86-187558 confirmed by document recorded April 25, 1986, as Instrument
No. 86-203239, amended by Amendment No. 1 thereto recorded July 17,
1986, as Instrument No. 86-367462, and amended by Amendment No. 2
thereto recorded on November 25, 1986, as Instrument No. 86-650739, in
Maricopa County, Arizona Recorder's Office.
================================================================================
6091.BURNHAMU1.DEBT.71:1
AMENDMENT NO. 3 dated as of March 30, 1987 (Amendment No. 3),
to the Facility Lease dated as of December 16, 1985, between THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, not in its individual capacity,
but solely as Owner Trustee under a Trust Agreement, dated as of December 16,
1985, with Burnham Leasing Corporation (the Lessor), and PUBLIC SERVICE COMPANY
OF NEW MEXICO, a New Mexico corporation (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessee and the Lessor have heretofore entered
into a Facility Lease dated as of December 16, 1985, as heretofore amended (the
Facility Lease), providing for the lease by the Lessor to the Lessee of the
Undivided Interest and the Real Property Interest;
WHEREAS, the Lessee and the Lessor desire to amend the
Facility Lease as set forth in Section 2 hereof; and
WHEREAS, the Indenture Trustee has consented to this Amendment
No. 3 pursuant to the Request, Instruction and Consent effective on March 30,
1987;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
6091.BURNHAMU1.DEBT.71:1
- 1 -
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein or in the recitals shall have the meanings assigned to
such terms in Appendix A to the Facility Lease.
SECTION 2. Amendments.
(a) Section 3(a)(ii) of the Facility Lease (as amended by
Amendment No. 2 thereto) is hereby amended to read in its entirety as follows:
"(ii) (1) on July 15, 1986 an amount equal to 4.3683233% of Facility
Cost (2) on January 15, 1987 an amount equal to 4.70354% of Facility Cost and"
(3) on July 15, 1987 and on each Basic Rent Payment Date thereafter to and
including January 15, 2015, an amount equal to 4.7006080% of Facility Cost;
and".
(b) Section 16(a)(v) of the Facility Lease is hereby amended
by (i) striking the "or" at the end of clause (B) thereof, (ii) inserting an
"or" at the end of clause (C) thereof and (iii) inserting at the end of such
Section 16(a)(v) the following new clause (D):
"(D) an amount equal to the higher of (1) the Casualty Value (Special
Casualty Value if the Event of Default is an event specified in clause (v),
(viii) or (x)(2) of Section 15 hereof), computed as of the Basic Rent Payment
Date specified in such notice or (2) the Fair Market Sales Value of the
Undivided Interest and the real Property Interest;"
(c) Section 16(a)(v) of the Facility Lease, as amended by
Amendment No. 1 thereto, is hereby further amended by deleting the parenthetical
phrase first preceding clause (A) of such Section 16(a)(v) and inserting in lieu
thereof ("and, in the case of (D) below, upon receipt of such payment the Lessor
shall (or, prior to receipt of such payment, may) Transfer to the Lessee the
Undivided Interest and the Real Property Interest)".
6091.BURNHAMU1.DEBT.71:1
- 2 -
(d) Section 16(a)(vi) of the Facility Lease is hereby amended
by inserting the phrase", but not in the case of an Event of Default specified
in clause (iii) of Section 15," immediately following the words "if it shall so
elect".
(e) The definitions of "Event of Loss" and "Final Shutdown"
set forth in Appendix A to the Facility Lease are hereby amended to read in
their entirety as set forth in Appendix A-1 hereto.
(f) The definition of "Undivided Interest Percentage" set
forth in Appendix A to the Facility Lease is hereby amended in its entirety to
read as follows:
"Undivided Interest Percentage shall, when used with respect to Unit 1 (not
including Common Facilities), mean an undivided 2.266667% interest therein and
shall, when used with respect to Common Facilities, mean an undivided .755556%
interest therein."
SECTION 3. Miscellaneous.
(a) Effective Date of Amendments. The amend- ments set forth
in Section 2 hereof shall be and become effective upon the execution hereof by
the parties hereto.
(b) Counterpart Execution. This Amendment No. 3 may be
executed in any number of counterparts and by each of the parties hereto on
separate counterparts; all such counterparts shall together constitute but one
and the same instrument.
(c) Governing Law. This Amendment No. 3 has been negotiated
and delivered in the State of New York and shall be governed by, and be
construed in accordance with, the laws of the State of New York, except to the
extent that pursuant to the law of the State of Arizona such law is mandatorily
applicable hereto.
6091.BURNHAMU1.DEBT.71:1
- 3 -
(d) Disclosure. Pursuant to Arizona Revised Statutes Section
33-401, the beneficiary of the Trust Agreement is Burnham Leasing Corporation, a
New York corporation. The address of the beneficiary is 60 Broad Street, New
York, New York 10004, Attention: Assistant Treasurer. A copy of the Trust
Agreement is available for inspection at the offices of the Owner Trustee at 100
Federal Street, Boston, Massachusetts 02110, Attention of Corporate Trust
Division.
(e) Amendment No. 3. The single executed orig- inal of this
Amendment No. 3 marked "THIS COUNTERPART IS THE ORIGINAL COUNTERPART" and
containing the receipt of the Indenture Trustee thereon shall be the "Original"
of this Amendment No. 3. To the extent that the Facility Lease constitutes
chattel paper, as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest in the Facility
Lease as amended by this Amendment No. 3 may be created or continued through the
transfer or possession of any counterpart of this Amendment No. 3 other than the
"Original".
6091.BURNHAMU1.DEBT.71:1
- 4 -
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 3 to Facility Lease to be duly executed in Boston, Massachusetts,
or Albuquerque, New Mexico, as the case may be, by an officer thereunto duly
authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with
Burnham Leasing Corporation
By: /S/
Assistant Cashier
PUBLIC SERVICE COMPANY OF NEW
MEXICO
By: /S/ B. D. Lackey
Vice President and Corporate
Controller
6091.BURNHAMU1.DEBT.71:1
- 5 -
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 3 to Facility Lease to be duly executed in Boston, Massachusetts,
or Albuquerque, New Mexico, as the case may be, by an officer thereunto duly
authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with
Burnham Leasing Corporation
By: /S/
Assistant Cashier
PUBLIC SERVICE COMPANY OF NEW
MEXICO
By:
Vice President and Corporate
Controller
6091.BURNHAMU1.DEBT.71:1
- 6 -
State of New Mexico )
) ss.
County of Bernalillo)
The foregoing instrument was acknowledged before me this 27th
day of March, 1987, by B.D. Lackey, the Vice President and Corporate Controller
of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation, on behalf of
the corporation.
/S/
Notary Public
Commonwealth of Massachussets)
) ss.
County of Suffolk )
The foregoing instrument was acknowledged before me this 27th
day of March, 1987 by James E. Mogavero, an Assistant Cashier of THE FIRST
NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Burnham Leasing Corporation.
Notary Public
6091.BURNHAMU1.DEBT.71:1
State of New Mexico )
) ss.
County of Bernalillo)
The foregoing instrument was acknowledged before me this 27th
day of March, 1987, by B.D. Lackey, the Vice President and Corporate Controller
of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation, on behalf of
the corporation.
Notary Public
Commonwealth of Massachussets)
) ss.
County of Suffolk )
The foregoing instrument was acknowledged before me this 27th
day of March, 1987 by James E. Mogavero, an Assistant Cashier of THE FIRST
NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Burnham Leasing Corporation.
/S/ Julie E. Comeau
Notary Public
6091.BURNHAMU1.DEBT.71:1
SCHEDULE A-1
to
AMENDMENT NO. 3
Amendment to Definitions of
"Event of Loss" and "Final Shutdown"
Event of Loss shall mean any of the following events: (a) a Final
Shutdown, (b) a Requisition of Title, or (c) a Requisition of Use for an
indefinite period which can be reasonably expected to exceed, or a stated period
which ends on the last day of or after, the Lease Term (including the Renewal
Term only if the Renewal Term shall have been elected prior to such Requisition
of Use by the exercise of the renewal option provided in Section 12 of the
Facility Lease).
Final Shutdown shall mean the earlier to occur of:
(1) the expiration or revocation of the License or that
portion of the License that permits the operation of Unit 1 or the expiration,
suspension or revocation of the License or that portion of the License that
permits the possession by the Lessee of the Undivided Interest and the Real
Property Interest; or
(2) the suspension (pursuant to 10 C.F.R. Section 2.202, as
amended, and any successor provision) of the License or that portion of the
License that permits the operation of Unit 1, which suspension remains in effect
for three consecutive calendar months; or
(3) the permanent or temporary cessation of operation of Unit
1 as a result of a Nuclear Incident at Unit 1 (or if Unit 1 is not in operation
immediately prior to the occurrence of such Nuclear Incident, the failure to
resume operation thereof as a result of such Nuclear Incident) if (A) the Period
of such cessation or failure equals or exceeds twenty-four consecutive calendar
months, or (B) such Nuclear Incident causes the radiation level in the
containment building of Unit 1, as measured by the average of two high range
radiation monitors in such containment building of Unit 1 (or if only one such
monitor is operating at such time, such monitor) over one hour to equal or
exceed 500 rads per hour; provided, however, this subsection (B) shall not apply
in respect of a Nuclear Incident arising solely from a fuel handling accident;
or
6091.BURNHAMU1.DEBT.71:1
(4) the permanent or temporary cessation of operation of Unit
1 as a result of a Nuclear Incident at Unit 2 or 3 (the Affected Unit) (or if
Unit 1 is not in operation immediately prior to the occurrence of such Nuclear
Incident, the failure to resume operation thereof as a result of such Nuclear
Incident) if (A) the Period of such cessation or failure equals or exceeds
thirty-six consecutive calendar months; or (B) such Nuclear Incident causes the
radiation level in the containment building of the Affected Unit, as measured by
the average of two high range radiation monitors in such containment building
(or if only one such monitor is operating at such time, such monitor) over one
hour to equal or exceed 500 rads per hour; provided, however, this subsection
(B) shall not apply in respect of a Nuclear Incident arising solely from a fuel
handling accident;
(5) the occurrence of a Nuclear Incident at Unit 1, 2 or 3
causing (A) substantial injury or death to any person on or off the PVNGS Site
or (B) a discharge or dispersal of Source, Special Nuclear or Byproduct Material
from its intended place of confinement in amounts off the PVNGS Site or causing
radiation levels off the PVNGS Site such that, in the case of (B) above (x) the
NRC declares the occurrence of an Extraordinary Nuclear Occurrence or declares
any other event connoting an equivalent level of accident or (y) the surface
contamination dose rate measured off the PVNGS Site by a radiation monitor at 1
meter above the surface level equals or is greater at any time than 10
millirads/hour (0.10 milligray/hour) or in the case of noble gas plume passage,
the radiation dose rate equals or is greater than 10 rads (0.10 gray) integrated
over 24 hours, (or if the NRC shall at any time lower the radiation levels
required for the occurrence of an Extraordinary Nuclear Occurrence, such lower
levels as shall be consistent with such change by the NRC); or
(6) damage to or destruction of any portion of Unit 1 and,
unless Lessee theretofore shall have exercised its purchase option under Section
13(b) of the Facility Lease, the failure of the Lessee, or of the Lessee and one
more other ANPP Participants, (A) to agree within eighteen calendar months of
such damage or destruction (or prior to such earlier date as of which one or
more other ANPP Participants shall agree to restore or reconstruct any damaged
portion of Unit 1 in accordance with Section 16.2 of the ANPP Participation
6091.BURNHAMU1.DEBT.71:1
Agreement) to restore or reconstruct Unit 1 to completion prior to the day sixty
calendar months after the date of such agreement and (B) thereafter to complete
the restoration and reconstruction of Unit 1 within a period of sixty calendar
months after the date of such agreement, provided that no Final Shutdown shall
be deemed to have occurred pursuant to this clause (6) if and so long as Unit 1
is in operation at a rated core power level of at least 1900 megawatts thermal;
or
(7) the non-operation of Unit 1 or the operation of Unit 1 at
a net rated power level below 630 megawatts electric or any combination thereof
for any reason (including, without limitation, the occurrence of any Nuclear
Incident at any generating facility located anywhere in the world) for a Period
of thirty-six consecutive calendar months (or a period through the penultimate
day of the Lease Term if the Lessee shall have given notice of its intent to
exercise the purchase option permitted by Section 13(b) of the Facility Lease)
other than as a result of damage to or destruction of Unit 1.
For purposes of this definition, a Final Shutdown resulting from the occurrence
of an event described in clause (5) above shall be deemed to have occurred
immediately and automatically upon the decline of the water coolant within Unit
1 to a level three feet above the nuclear fuel.
For purposes of the definition of "Final Shutdown" only, the
following capitalized terms set forth therein shall have the following meanings
(other capitalized terms having the respective meanings set forth in Appendix A
to the Facility Lease):
Extraordinary Nuclear Occurrence shall have its meaning as
defined in Section 11 of the Atomic Energy Act and the related NRC regulations,
as amended to the date hereof, and as the meaning of such term shall be expanded
from time to time by future amendments thereof. The definition of "extraordinary
nuclear occurrence" contained in Section 11 of the Atomic Energy Act on the date
hereof is: "any event causing a discharge dispersal of source, special nuclear,
or byproduct material from its place of confinement in amounts offsite, or
causing radiation levels offsite, which the Commission determines to be
6091.BURNHAMU1.DEBT.71:1
substantial, and which the Commission determines has resulted or will probably
result in substantial damages to persons offsite or property offsite. Any
determination by the Commission that such an event has, or has not, occurred
shall be final and conclusive, and no other official or any court shall have
power or jurisdiction to review any such determination. The Commission shall
establish criteria in writing setting forth the basis upon which such
determination shall be made. As used in this subsection, 'offsite' means away
from 'the location' or 'the contract location' as defined in the applicable
Commission indemnity agreement, entered into pursuant to section 2210 of this
title."
Nuclear Incident shall have its meaning as defined in Section
11 of the Atomic Energy Act, as amended to the date hereof and as the meaning of
such term may be expanded from time to time by future amendments thereof. The
definition of "nuclear incident" contained in the Atomic Energy Act on the date
hereof is: "any occurrence, including an extraordinary nuclear occurrence,
within the United States causing, within or outside the United States, bodily
injury, sickness, disease, or death, or loss of or damage to property, or loss
of use of property, arising out of or resulting from the radioactive, toxic,
explosive, or other hazardous properties of source, special nuclear, or
byproduct material: Provided, however, that as the term is used in section
2210(1) of this title, it shall include any such occurrence outside the United
States: And provided further, That as the term is used in section 2210(d) of
this title, it shall include any such occurrence outside the United States if
such occurrence involves source, special nuclear, or byproduct material owned
by, and used by or under contract with, the United States: And provided further,
That as the term is used in section 2210(c) of this title, it shall include any
such occurrence outside both the United States and any other nation if such
occurrence arises out of or results from the radioactive, toxic, explosive, or
other hazardous properties of source, special nuclear, or byproduct material
licensed pursuant to subchapters V, VI, VII, and IX of this chapter, which is
used in connection with the operation of a licensed stationary production or
utilization facility or which moves outside the territorial limits of the United
States in transit from one person licensed by the Commission to another person
licensed by the Commission."
6091.BURNHAMU1.DEBT.71:1
Period of a stated duration in respect of any event shall mean
an indefinite period which can reasonably be expected to exceed the lesser of
such duration and the period remaining to the date which is three years prior to
the end of the remaining Basic Lease Term (or if such event occurs after the
date three years prior to the end of the remaining Basic Lease Term, the lesser
of six months and the period remaining to the day next preceding the end of the
Basic Lease Term) or a stated period in excess of the lesser thereof or an
actual period which continues in excess of the lesser thereof.
Source, Special Nuclear or Byproduct Material shall have their
respective defined meanings as defined in Section 11 of the Atomic Energy Act of
1954, as amended to the date hereof and as the meanings of such terms may be
expanded by future amendments thereof.
6091.BURNHAMU1.DEBT.71:1
EXHIBIT 10.54
When Recorded, Return to: Gregg R. Neilsen, Esq.
Snell & Wilmer
3100 Valley Bank Center
Phoenix, Arizona 85073
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS HERETOFORE
AMENDED AND AS AMENDED BY THIS AMENDMENT NO. 3 THERETO HAVE BEEN ASSIGNED TO,
AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF, CHEMICAL BANK, AS INDENTURE
TRUSTEE UNDER A TRUST INDENTURE, MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF
RENTS DATED AS OF DECEMBER 16, 1985, AS AMENDED. THIS AMENDMENT NO. 3 HAS BEEN
EXECUTED IN SEVERAL COUNTERPARTS. SEE SECTION 3(e) OF THIS AMENDMENT NO. 3 FOR
INFORMATION CONCERNING THE RIGHTS OF HOLDERS OF VAR- IOUS COUNTERPARTS HEREOF
AND OF THE FACILITY LEASE.
THIS COUNTERPART IS NOT THE ORIGINAL COUNTERPART.
================================================================================
AMENDMENT NO. 3
Dated as of March 30, 1987
to
FACILITY LEASE
Dated as of December 16, 1985, as amended
between
THE FIRST NATIONAL BANK OF BOSTON,
not in its individual capacity,
but solely as Owner Trustee under
a Trust Agreement, dated as of
December 16, 1985, with Chrysler
Financial Corporation,
Lessor
and
PUBLIC SERVICE COMPANY OF NEW MEXICO,
Lessee
================================================================================
Original Facility Lease recorded December 31, 1985, as Instrument No. 85-623282,
amended by Amendment No. 1 thereto recorded July 17, 1986, as Instrument No. 86-
367464 and amended by Amendment No. 2 thereto recorded on November 25, 1986, as
Instrument 86-650763, in Maricopa County, Arizona Recorder's Office.
================================================================================
6091.CHRYSLER.DEBT.71:1
AMENDMENT NO. 3, dated as of March 30, 1987 (Amendment No. 3),
to the Facility Lease dated as of December 16, 1985, between THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, not in its individual capacity,
but solely as Owner Trustee under a Trust Agreement, dated as of December 16,
1985, with Chrysler Financial Corporation (the Lessor), and PUBLIC SERVICE
COMPANY OF NEW MEXICO, a New Mexico corporation (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessee and the Lessor have heretofore entered
into a Facility Lease dated as of December 16, 1985, as heretofore amended (the
Facility Lease), providing for the lease by the Lessor to the Lessee of the
Undivided Interest and the Real Property Interest;
WHEREAS, the Lessee and the Lessor desire to amend the
Facility Lease as set forth in Section 2 hereof; and
WHEREAS, the Indenture Trustee has consented to this Amendment
No. 3 pursuant to the Request, Instruction and Consent effective on March 30,
1987;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
6091.CHRYSLER.DEBT.71:1
- 1 -
SECTION 1. Definitions.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein or in the recitals shall have the meanings assigned to
such terms in Appendix A to the Facility Lease.
SECTION 2. Amendments.
(a) Section 3(a)(ii) of the Facility Lease (as amended by
Amendment No. 2 thereto) is hereby amended to read in its entirety as follows:
"(ii)(1) on July 15, 1986 an amount equal to 4.3683233% of
Facility Cost (2) on January 15, 1987 an amount equal to 4.755716% of
Facility Cost and (3) on July 15, 1987 and on each Basic Rent Payment
Date thereafter to and including January 15, 2015, an amount equal to
4.7527840% of Facility Cost; and".
(b) Section 16(a)(v) of the Facility Lease is hereby amended
by (i) striking the "or" at the end of clause (B) thereof, (ii) inserting an
"or" at the end of clause (C) thereof and (iii) inserting at the end of such
Section 16(a)(v) the following new clause (D):
"(D) an amount equal to the higher of (1) the Casualty Value
(Special Casualty Value if the Event of Default is an event specified
in clause (v), (viii) or (x)(2) of Section 15 hereof), computed as of
the Basic Rent Payment Date specified in such notice or (2) the Fair
Market Sales Value of the Undivided Interest and the Real Property
Interest;"
(c) Section 16(a)(v) of the Facility Lease, as amended by
Amendment No. 1 thereto, is hereby further amended by deleting the parenthetical
phrase first preceding clause (A) of such Section 16(a)(v) and inserting in lieu
thereof ("and, in the case of (D) below, upon receipt of such payment the Lessor
shall (or, prior to receipt of such payment, may) Transfer to the Lessee the
Undivided Interest and the Real Property Interest)".
6091.CHRYSLER.DEBT.71:1
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(d) Section 16(a)(vi) of the Facility Lease is hereby amended
by inserting the phrase", but not in the case of an Event of Default specified
in clause (iii) of Section 15," immediately following the words "if it shall so
elect".
(e) The definitions of "Event of Loss" and "Final Shutdown"
set forth in Appendix A to the Facility Lease are hereby amended to read in
their entirety as set forth in Appendix A-1 hereto.
(f) The definition of "Undivided Interest Percentage" set
forth in Appendix A to the Facility Lease is hereby amended in its entirety to
read as follows:
"Undivided Interest Percentage shall, when used with respect to Unit 1
(not including Common Facilities), mean an undivided 3.74% interest
therein and shall, when used with respect to Common Facilities, mean an
undivided 1.246667% interest therein."
SECTION 3. Miscellaneous.
(a) Effective Date of Amendments. The amend- ments set forth
in Section 2 hereof shall be and become effective upon the execution hereof by
the parties hereto.
(b) Counterpart Execution. This Amendment No. 3 may be
executed in any number of counterparts and by each of the parties hereto on
separate counterparts; all such counterparts shall together constitute but one
and the same instrument.
(c) Governing Law. This Amendment No. 3 has been negotiated
and delivered in the State of New York and shall be governed by, and be
construed in accordance with, the laws of the State of New York, except to the
extent that pursuant to the law of the State of Arizona such law is mandatorily
applicable hereto.
6091.CHRYSLER.DEBT.71:1
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(d) Disclosure. Pursuant to Arizona Revised Statutes Section
33-401, the beneficiary of the Trust Agreement is Chrysler Financial
Corporation, a Michigan corporation. The address of the beneficiary is Greenwich
Office Park I, Greenwich, Connecticut 06836. A copy of the Trust Agreement is
available for inspection at the offices of the Owner Trustee at 100 Federal
Street, Boston, Massachusetts 02110, Attention of Corporate Trust Division.
(e) Amendment No. 3. The single executed orig- inal of this
Amendment No. 3 marked "THIS COUNTERPART IS THE ORIGINAL COUNTERPART" and
containing the receipt of the Indenture Trustee thereon shall be the "Original"
of this Amendment No. 3. To the extent that the Facility Lease constitutes
chattel paper, as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest in the Facility
Lease as amended by this Amendment No. 3 may be created or continued through the
transfer or possession of any counterpart of this Amendment No. 3 other than the
"Original".
6091.CHRYSLER.DEBT.71:1
- 4 -
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 3 to Facility Lease to be duly executed in Boston, Massachusetts,
or Albuquerque, New Mexico, as the case may be, by an officer thereunto duly
authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with
Chrysler Financial Corporation
By: /S/
Assistant Cashier
PUBLIC SERVICE COMPANY OF NEW
MEXICO
By:
Vice President and Corporate
Controller
6091.CHRYSLER.DEBT.71:1
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 3 to Facility Lease to be duly executed in Boston, Massachusetts,
or Albuquerque, New Mexico, as the case may be, by an officer thereunto duly
authorized.
THE FIRST NATIONAL BANK OF BOSTON, not in
its individual capacity, but solely as
Owner Trustee under a Trust Agreement,
dated as of December 16, 1985, with
Chrysler Financial Corporation
By:
Assistant Cashier
PUBLIC SERVICE COMPANY OF NEW
MEXICO
By: /S/ B. D. Lackey
Vice President and Corporate
Controller
6091.CHRYSLER.DEBT.71:1
- 6 -
State of New Mexico )
) ss.
County of Bernalillo)
The foregoing instrument was acknowledged before me this 27th
day of March, 1987, by B.D. Lackey, the Vice President and Corporate Controller
of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation, on behalf of
the corporation.
/S/
Notary Public
Commonwealth of Massachussets)
) ss.
County of Suffolk )
The foregoing instrument was acknowledged before me this 27th
day of March, 1987, by James E. Mogavero, an Assistant Cashier of THE FIRST
NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Chrysler Financial Corporation.
Notary Public
6091.CHRYSLER.DEBT.71:1
State of New Mexico )
) ss.
County of Bernalillo)
The foregoing instrument was acknowledged before me this 27th
day of March, 1987, by B.D. Lackey, the Vice President and Corporate Controller
of PUBLIC SERVICE COMPANY OF NEW MEXICO, a New Mexico corporation, on behalf of
the corporation.
Notary Public
Commonwealth of Massachussets)
) ss.
County of Suffolk )
The foregoing instrument was acknowledged before me this 27th
day of March, 1987 by James E. Mogavero, an Assistant Cashier of THE FIRST
NATIONAL BANK OF BOSTON, a national banking association, on behalf of the
banking association as trustee under that certain Trust Agreement dated as of
December 16, 1985 with Chrysler Financial Corporation.
/S/ Julie E. Comeau
Notary Public
6091.CHRYSLER.DEBT.71:1
SCHEDULE A-1
to
AMENDMENT NO. 3
Amendment to Definitions of
"Event of Loss" and "Final Shutdown"
Event of Loss shall mean any of the following events: (a) a
Final Shutdown, (b) a Requisition of Title, (c) a Requisition of Use which can
reasonably be expected to exceed, or for a stated period which ends on or after,
the penultimate day of the Lease Term, (d) any degradation of the rated capacity
of Unit 1 to below 630 megawatts electric for an indefinite period which can
reasonably be expected to exceed the lesser of 5 years and the remaining Lease
Term or for a stated period in excess of the lesser of five years and the
remaining Lease Term (other than as a result of damage to or destruction of Unit
1), or (e) any degradation of the rated capacity of Unit 1 to below, or the
inability of Unit 1 to produce electricity at a level above, 630 megawatts
electric for the Minimum Period (other than as a result of damage to or
destruction of Unit 1, Governmental Action or an event referred to in part
(10)(x) or (10)(y) of the definition of "Final Shutdown"). For purposes of this
definition, Minimum Period shall mean the shorter of (x) the shorter of (1) an
indefinite period unless such period can reasonably be expected to be shorter
than the applicable Benchmark Period and (2) an actual period in excess of the
applicable Benchmark Period and (y) a period beginning on the date of
determination through and including the penultimate day of the Lease Term, and
Benchmark Period shall mean a period equal to any 60 consecutive calendar months
except that a period of 36 consecutive calendar months shall be applicable with
respect to events specified in part 10(y) of the definition of "Final Shutdown".
The period specified in the foregoing clause (x)(1) shall be determined by an
independent nuclear consultant agreed to by the Lessee and the Owner Participant
or, failing prompt agreement upon such consultant, appointed by the American
Arbitration Association (or comparable or successor organization).
6091.CHRYSLER.DEBT.71:1
Final Shutdown shall mean the earlier to occur of:
(1) (i) the expiration, suspension (for an indefinite period
which can reasonably be expected to exceed the lesser of five years and the
remaining Lease Term or for a stated period in excess of the lesser of five
years and the remaining Lease Term) or revocation of that portion of the License
that permits the operation of Unit 1 or the possession by the Lessee of the
Undivided Interest and the Real Property Interest, (ii) the cessation of
operation of Unit 1 as a result of a nuclear incident relating to PVNGS for an
indefinite period which can reasonably be expected to exceed the lesser of five
years and the remaining Lease Term or for a stated period in excess of the
lesser of five years and the remaining Lease Term, (iii) damage to or
destruction of Unit 1 and the failure of the Lessee, or of the Lessee and one or
more other ANPP Participants, to agree within five years of such damage or
destruction to restore and reconstruct Unit 1 and (iv) damage to or destruction
of Unit 1, without restoration or reconstruction having been completed by the
end of the Lease Term, such that Unit 1 will have a rated capacity as of the
penultimate day of the Lease Term of at least 630 megawatts electric; or
(2) the suspension of the License or that portion of the
License that permits the possession by the Lessee of the Undivided Interest and
the Real Property Interest; or
(3) the suspension (pursuant to 10 C.F.R. Section 2.202, as
amended, any successor provision) of the License or that portion of the License
that permits the operation of Unit 1, which suspension remains in effect for
three consecutive calendar months; or
(4) the permanent or temporary cessation of operation of Unit
1 as a result of a Nuclear Incident at Unit 1 (or if Unit 1 is not in operation
immediately prior to the occurrence of such Nuclear Incident, the failure to
resume operation thereof as a result of such Nuclear Incident) if (A) the Period
of such cessation or failure equals or exceeds twenty-four consecutive calendar
months, or (B) such Nuclear Incident causes the radiation level in the
6091.CHRYSLER.DEBT.71:1
containment building of Unit 1 (or if only one such monitor is operating at such
time, such monitor) over one hour to equal or exceed 500 rads per hour;
provided, however, this clause (B) shall not apply in respect of a Nuclear
Incident arising solely from a fuel handling accident;
(5) the permanent or temporary cessation of operation of Unit
1 as a result of a Nuclear Incident at Unit 2 or 3 (the Affected Unit) (or if
Unit 1 is not in operation immediately prior to the occurrence of such Nuclear
Incident, the failure to resume operation thereof as a result of such Nuclear
Incident) if (A) the Period of such cessation or failure equals or exceeds
thirty-six consecutive calendar months; or (B) such Nuclear Incident causes the
radiation level in the containment building of the Affected Unit, as measured by
the average of two high range radiation monitors in such containment building
(or if only one such monitor is operating at such time, such monitor) over one
hour to equal or exceed 500 rads per hour; provided, however, this clause (B)
shall not apply in respect of a Nuclear Incident arising solely from a fuel
handling accident; or
(6) the occurrence of a Nuclear Incident at Unit 1, 2 or 3
causing (A) substantial injury or death to any person on or off the PVNGS Site
or (B) a discharge or dispersal of Source, Special Nuclear or Byproduct Material
from its intended place of confinement in amounts off the PVNGS Site or causing
radiation levels off the PVNGS Site such that, in the case of this clause (B)
(x) the NRC declares the occurrence of an Extraordinary Nuclear Occurrence or
declares any other event connoting an equivalent level of accident or (y) the
surface contamination dose rate measured off the PVNGS Site by a radiation
monitor at 1 meter above the surface level equals or is greater at any time than
10 millirads/hour (0.10 milligray/hour) or, in the case of noble gas plume
passage, the radiation dose rate equals or is greater than 10 rads (0.10 gray)
integrated over 24 hours, (or if the NRC shall at any time lower the radiation
levels required for the occurrence of an Extraordinary Nuclear Occurrence, such
lower levels as shall be consistent with such change by the NRC); or
(7) damage to or destruction of any portion of Unit 1 and,
unless Lessee theretofore shall have exercised its purchase option under Section
13(b) of the Facility Lease, the failure of the Lessee, or of the Lessee and one
6091.CHRYSLER.DEBT.71:1
more other ANPP Participants, (A) to agree within eighteen calendar months of
such damage or destruction (or prior to such earlier date as of which one or
more other ANPP Participants shall agree to restore or reconstruct any damaged
portion of Unit 1 in accordance with Section 16.2 of the ANPP Participation
Agreement) to restore or reconstruct Unit 1 to completion prior to the day sixty
calendar months after the date of such agreement and (B) thereafter to complete
the restoration and reconstruction of Unit 1 within a period of sixty calendar
months after the date of such agreement, provided that no Final Shutdown shall
be deemed to have occurred pursuant to this clause (6) if and so long as Unit 1
is in operation at a rated core power level of at least 1900 megawatts thermal;
or
(8) the non-operation of Unit 1 or the operation of Unit 1 at
a net rated power level below 630 megawatts electric or any combination thereof
for any reason (including, without limitation, the occurrence of any Nuclear
Incident at any generating facility located anywhere in the world) for a Period
of thirty-six consecutive calendar months (or a period through the penultimate
day of the Lease Term if the Lessee shall have given notice of its intent to
exercise the purchase option permitted by Section 13(b) of the Facility Lease)
other than as a result of damage to or destruction of Unit 1; or
(9) the taking of any Governmental Action or the adoption or
making of any interpretations, directives or requests by any Governmental
Authority (including, without limitation, the staff thereof) or the concurrence
by any Governmental Authority in the voluntary action of the operator thereof,
in each such case whether formal or informal, by reason of which Unit 1 shall
cease to operate, or shall be unable under Applicable Law to resume operation,
at a capacity level of at least 630 megawatts electric for the Minimum Period;
or
(10) the cessation of operation of Unit 1 as a result of
either (x) the occurrence of an Extraordinary Nuclear Occurrence or an Incipient
Extraordinary Nuclear Occurrence relating to Unit 1 or (y) a Nuclear Incident
relating to Unit 1 and, in the case of this clause (y), the continuation of such
cessation for the Minimum Period; or
6091.CHRYSLER.DEBT.71:1
(11) damage to Unit 1, without restoration or reconstruction
having been completed by the expiration of the Minimum Period, such that Unit 1
has a rated capacity of at least 630 megawatts electric; or
(12) destruction of Unit 1.
For purposes of clause (iii) of part (1) of this definition,
Final Shutdown will be deemed to have occurred upon the earlier of (x) the
written declaration of the Lessee of its intent not so to agree and (y) the
expiration of such five-year period without written agreement, and pursuant to
the foregoing clause (iv) of part (1), Final Shutdown will be deemed to have
occurred on the day preceding the Lease Termination Date. For purposes of part
(6) of this definition, a Final Shutdown shall be deemed to have occurred
immediately and automatically upon the decline of the water coolant within Unit
1 to a level three fee above the nuclear fuel and for purposes of parts (9),
(10)(y) and (11) of this definition, on the last day of the Minimum Period.
For purposes of parts (9), (10) and (11) of this definition,
Minimum Period shall have the same meaning assigned to it in the definition of
"Event of Loss".
For purposes of part (6) of this definition, Extraordinary
Nuclear Occurrence shall have its meaning as defined in Section 11 of the Atomic
Energy Act and the related NRC regulations, as amended to the date hereof, and
as the meaning of such term shall be expanded from time to time by future
amendments thereof. The definition of "extraordinary nuclear occurrence"
contained in Section 11 of the Atomic Energy Act on the date hereof is: "any
event causing a discharge or dispersal of source, special nuclear, or byproduct
material from its intended place of confinement in amounts offsite, or causing
radiation levels offsite, which the Commission determines to be substantial, and
which the Commission determines has resulted or will probably result in
substantial damages to persons offsite or property offsite. Any determination by
the Commission that such an event has, or has not, occurred shall be final and
conclusive, and no other official or any court shall have power or jurisdiction
to review any such determination. The Commission shall establish criteria in
writing setting forth the basis upon which such determination shall be made. As
6091.CHRYSLER.DEBT.71:1
used in this subsection, 'offsite' means away from 'the location' or 'the
contract location' as defined in the applicable Commission indemnity agreement,
entered into pursuant to section 2210 of this title."
For purposes of part (10) of this definition: the term
"Extraordinary Nuclear Occurrence" shall have its meaning as defined in Section
11 of the Atomic Energy Act of 1954, as amended to the Closing Date; the term
"Incipient Extraordinary Nuclear Occurrence" shall mean an event causing a
discharge or dispersal of nuclear source, special nuclear or nuclear by-product
material from its intended place of confinement in amounts off site or on site
or causing a radiation level off site or on site which an independent nuclear
consultant agreed to by the Lessee and the Owner Participant (or, failing prompt
agreement, appointed by the American Arbitration Association) determines to be
substantial and which such consultant determines has resulted in substantial
injury to persons on or off the PVNGS Site or substantial damage to property off
the PVNGS Site; and the term "Nuclear Incident" shall mean any occurrence
causing bodily injury, sickness, disease or death, or loss of or damage to
property, or the loss of use of property, arising out of or resulting from the
radioactive, toxic, explosive or other hazardous properties of nuclear source,
special nuclear or nuclear by-product material.
For purposes of parts (4), (5), (6) and (8) of this
definition, Nuclear Incident shall have its meaning as defined in Section 11 of
the Atomic Energy Act, as amended to the date hereof and as the meaning of such
term may be expanded from time to time by future amendments thereof. The
definition of "nuclear incident" contained in the Atomic Energy Act on the date
hereof is: "any occurrence, including an extraordinary nuclear occurrence,
within the United States causing, within or outside the United States, bodily
injury, sickness, disease, or death, or loss of or damage to property, or loss
of use of property, arising out of or resulting from the radioactive, toxic,
explosive, or other hazardous properties of source, special nuclear, or
byproduct material: Provided, however, that as the term is used in section
2210(1) of this title, it shall include any such occurrence outside the United
States: And provided further, That as the term is used in section 2210(d) of
this title, it shall include any such occurrence outside the United States if
6091.CHRYSLER.DEBT.71:1
such occurrence involves source, special nuclear, or byproduct material owned
by, and used by or under contract with, the United States: And provided further,
That as the term is used in section 2210(c) of this title, it shall include any
such occurrence outside both the United States and any other nation if such
occurrence arises out of or results from the radioactive, toxic, explosive, or
other hazardous properties of source, special nuclear, or byproduct material
licensed pursuant to subchapters V, VI, VII, and IX of this chapter, which is
used in connection with the operation of a licensed stationary production or
utilization facility or which moves outside the territorial limits of the United
States in transit from one person licensed by the Commission to another person
licensed by the Commission."
For purposes of parts (4), (5) and (8) of this definition,
Period of a stated duration in respect of any event shall mean an indefinite
period which can reasonably be expected to exceed the lesser of such duration
and the period remaining to the date which is three years prior to the end of
the remaining Basic Lease Term (or if such event occurs after the date three
years prior to the end of the remaining Basic Lease Term, the lesser of six
months and the period remaining to the day next preceding the end of the Basic
Lease Term) or a stated period in excess of the lesser thereof or an actual
period which continues in excess of the lesser thereof.
For purposes of part (6) of this definition, Source, Special
Nuclear or Byproduct Material shall have their respective defined meanings as
defined in Section 11 of the Atomic Energy Act of 1954, as amended to the date
hereof and as the meanings of such terms may be
expanded by future amendments thereof.
6091.CHRYSLER.DEBT.71:1