Exhibit 10.35
================================================================================
AMENDMENT NO. 4
dated as of October 13, 1994
to
PARTICIPATION AGREEMENT
dated as of September 15, 1987
among
BEAVER VALLEY TWO TAU LIMITED PARTNERSHIP,
as Owner Participant
DQU FUNDING CORPORATION,
as Funding Corp
DQU II FUNDING CORPORATION,
as New Funding Corp
THE FIRST NATIONAL BANK OF BOSTON,
in its individual capacity and as Owner Trustee
under a Trust Agreement,
dated as of September 15, 1987, with the
Owner Participant, as Owner Trustee
THE BANK OF NEW YORK,
in its individual capacity and as Indenture Trustee
under a Trust Indenture, Mortgage, Security Agreement
and Assignment of Facility Lease, dated as of
September 15, 1987,
with the Owner Trustee, as Indenture Trustee
and
DUQUESNE LIGHT COMPANY,
as Lessee
================================================================================
Sale and Leaseback of an Undivided Interest in
Beaver Valley Power Station Unit 2
================================================================================
AMENDMENT NO. 4, dated as of October 13, 1994 (this "Amendment No. 4")
to the Participation Agreement, dated as of September 15, 1987, among BEAVER
VALLEY TWO TAU LIMITED PARTNERSHIP (the "Owner Participant"), DQU FUNDING
CORPORATION, a Delaware corporation ("Funding Corp"), DQU II FUNDING
CORPORATION, a Delaware corporation ("New Funding Corp"), THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, in its individual capacity and
as Owner Trustee (the "Owner Trustee") under a Trust Agreement, dated as of
September 15, 1987, with the Owner Participant, THE BANK OF NEW YORK (formerly
IRVING TRUST COMPANY), a New York banking corporation, in its individual
capacity and as Indenture Trustee (the "Indenture Trustee") under a Trust
Indenture, Mortgage, Security Agreement and Assignment of Facility Lease, dated
as of September 15, 1987, with the Owner Trustee, and DUQUESNE LIGHT COMPANY, a
Pennsylvania corporation (the "Lessee").
W I T N E S S E T H :
-------------------
WHEREAS, the Owner Participant, the Original Loan Participants (such
term and other capitalized terms used herein without definition being defined as
provided in Section 1), Funding Corp, the Owner Trustee, the Indenture Trustee
and the Lessee have previously entered into a Participation Agreement, dated as
of September 15, 1987, as heretofore amended (such Participation Agreement, as
so amended, being hereinafter referred to as the "Participation Agreement");
WHEREAS, Section 3(d) of the Facility Lease provides for adjustments
to Basic Rent and schedules of Casualty Values, Special Casualty Values,
Modified Special Casualty Values and Special Termination Values if there is a
change in the Code which results in the marginal federal income tax rate
applicable to corporations differing from the rate assumed to be applicable in
the Pricing Assumptions as in effect on the Closing Date;
WHEREAS, by reason of the enactment of the Omnibus Budget
Reconciliation Act of 1993 (Pub. L. No. 103-66) the marginal Federal income tax
rate applicable to corporations increased from 34 percent to 35 percent for tax
years beginning on or after January 1, 1993;
WHEREAS, the Owner Trustee and the Lessee intend to execute Amendment
No. 3 to the Facility Lease dated as of the date hereof ("Lease Amendment No.
3"), to amend the schedules thereof;
WHEREAS, Funding Corp desires to cease to be a party to the
Participation Agreement;
WHEREAS, Section 2(e) of the Participation Agreement provides that,
subject to the satisfaction of the conditions set forth in Sections 2(d) and
11(c) of the Participation Agreement, the Owner Trustee and the Lessee in
connection with any Tax Rate
Adjustment, shall reoptimize the amortization schedules for the Notes in
accordance with, and in the manner contemplated by, Section 3(f) of the Facility
Lease subject to the constraints set forth in Section 2(e) of the Participation
Agreement, Section 3.12 of the Indenture and Section 2(b) of Supplemental
Indenture No. 2 to the Indenture;
WHEREAS, the Indenture Trustee, in connection with the adjustment to
the schedules of principal amortization attached to the Outstanding Fixed Rate
Notes, has agreed to waive the 60 day notice requirement under Section 2(b) of
Supplemental Indenture No. 2, dated as of November 15, 1992, to the Indenture
and accept a 45 day notice period in lieu thereof; and
WHEREAS, the parties hereto desire to amend the Pricing Assumptions in
the manner hereinafter set forth and reoptimize the amortization schedules for
the Notes as a result of a Tax Rate Adjustment.
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.
-----------
Except as otherwise defined herein and in the recitals, capitalized
terms used herein shall have the respective meanings set forth in Appendix A to
the Participation Agreement.
SECTION 2. REOPTIMIZATION.
--------------
Subject to Sections 2(d) and 11(c) of the Participation Agreement, on
the Effective Date (as hereinafter defined) the Lessor and the Lessee shall
reoptimize the amortization schedules for the Notes in accordance with and in
the manner contemplated by Section 3(f) of the Facility Lease, Section 3.12 of
the Indenture and Section 2(b) of the Supplemental Indenture No. 2 thereto, and
Section 2(e) of the Participation Agreement.
SECTION 3. Implementation.
--------------
(a) Forms. The form of Lease Amendment No. 3 is attached hereto
-----
as Exhibit A and the reoptimized amortization schedules for the Outstanding
Fixed Rate Notes are attached hereto as Exhibit C.
(b) Request by the Owner Participant. In accordance with Section
--------------------------------
2.01 of the Trust Agreement, subject to the satisfaction of the conditions set
forth in Section 2(d) and 11(c) of the Participation Agreement (it being the
agreement of the
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parties hereto that the transactions contemplated hereby do not constitute a
refunding pursuant to Section 2(d) of the Participation Agreement), the Owner
Participant hereby directs that the Owner Trustee (i) execute and deliver this
Amendment No. 4 and Lease Amendment No. 3 (collectively, the "1994 Amendments"),
(ii) execute and deliver all other agreements, instruments and certificates
contemplated by the 1994 Amendments, and (iii) instruct the Indenture Trustee to
(x) consent to Lease Amendment No. 3 and (y) attach the reoptimized amortization
schedules (attached hereto as Exhibit C for the Outstanding Fixed Rate Notes in
replacement for the existing amortization schedules to such Fixed Rate Notes.
(c) Instruction and Consent. In accordance with Section 10.2(ii)
-----------------------
of the Indenture, the Lessee and Owner Trustee hereby instruct the Indenture
Trustee to consent to Lease Amendment No. 3 and the Indenture Trustee so
consents.
(d) Consent of Lessee. In accordance with Section 8(b)(2) of the
-----------------
Participation Agreement, the Lessee hereby consents to the revised amortization
schedules attached to the respective Outstanding Fixed Rate Notes in connection
with the Tax Rate Adjustment.
Section 4. Amendments.
----------
(a) Schedule 5 to the Participation Agreement is hereby amended
and replaced in its entirety collectively with Schedules 1A, 1B and 1C hereto.
(b) The parties agree that Funding Corp shall cease to be a
party to the Participation Agreement and shall have no further rights or
obligations thereunder. The Participation Agreement is hereby amended generally
so that all references to Funding Corp shall be deemed to refer to New Funding
Corp and/or such other entity as may participate in the funding or refunding of
the Notes to the extent that such references relate to the rights, obligations
or interest of Funding Corporation subsequent to the Effective Date.
(c) The definition of Funding Corp or Funding Corporation in
Appendix A to the Participation Agreement is amended in its entirety to read as
follows:
"Funding Corp or Funding Corporation shall
mean New Funding Corp and/or such other
entity as may participate in the funding or
refunding of any Notes."
-3-
(d) Section 18(iv) is hereby amended by inserting at the end
thereof before the semicolon after the phrase "Attention: President" the
following phrase:
"and if to New Funding Corporation at:
c/o J H Management Corporation
1 International Place
Boston, Massachusetts 02110
Attention: Lannhi Tran."
Section 5. Conditions to Effectiveness.
---------------------------
This Amendment No. 4 shall become effective as of the Effective Date
(as hereinafter defined) if: (i) it shall have been duly executed and delivered
by all of the parties hereto and all of the conditions set forth below in this
Section 5 shall have been satisfied or waived, which satisfaction or waiver by
each of the parties hereto shall be deemed to be evidenced by the due execution
and delivery of this Amendment No. 4 by each such party (the date of the due
execution and delivery by the last of the parties to so execute and deliver this
Amendment No. 4 shall be defined as the "Effective Date"); (ii) each of Lease
Amendment No. 3 and Amendment No. 2 to the Tax Indemnification Agreement dated
as of the date hereof between the Owner Participant and the Lessee ("Amendment
No. 2 to TIA") shall have been duly executed and delivered by each of the
parties thereto; (iii) a replacement Letter of Credit shall have been issued in
favor of the Owner Participant having Maximum Drawing Amounts (as defined in the
Letter of Credit) corresponding to the Modified Special Casualty Values, as
adjusted on the Effective Date hereof; (iv) the Owner Participant shall have
received opinions from Lessee's Special Counsel, Lessee's NRC Counsel and such
other opinions as the Owner Participant shall reasonably request and all such
opinions shall be in form and substance reasonably satisfactory to the Owner
Participant, and (v) subject to the satisfaction of any and all other conditions
set forth in Sections 2(d) and 11(c) of the Participation Agreement (it being
the agreement of the parties hereto that the transactions contemplated hereby do
not constitute a refunding pursuant to Section 2(d) of the Participation
Agreement).
Section 6. Supplemental Rent Payment and Expenses
--------------------------------------
(a) Supplemental Rent Payment. On October 13, 1994 (the
-------------------------
"Adjustment Closing Date"), the Lessee shall pay, as Supplemental Rent and on
behalf of the Owner Trustee, the following costs and expenses (the "Adjustment
Transaction Expenses") in an amount equal to $31,000.00:
-4-
(i) the costs and expenses of the Owner Participant (including,
but not limited to, Owner Participant's computer lease analysis expenses,
out-of- pocket expenses and the legal fees and disbursements of the Owner
Participant's Special Counsel, including counsel for each partner of the Owner
Participant), and the Owner Participant's out-of-pocket expenses and fees and
disbursements of any financial advisors employed by it as well as fees and
expenses (including, but not limited to, all computer lease analysis and travel
related costs) of the Owner Trustee, the Owner Trustee's Counsel, the Indenture
Trustee, the Indenture Trustee's Counsel, the Collateral Trust Trustee, the
Collateral Trust Trustee's counsel, Special Counsel for Funding Corp, and
Special Counsel for New Funding Corp, if any, in each case for their services
rendered in connection with the negotiation, execution and delivery of this
Amendment No. 4, Lease Amendment No. 3, and Amendment No. 2 to TIA and all other
agreements, documents or instruments prepared in connection therewith and all
fees, taxes, expenses and disbursements incurred by them in connection with the
transactions contemplated hereby or thereby; and
(ii) all stenographic, printing, reproduction, and other out-of-
pocket expenses (other than investment banking or brokerage fees) incurred in
connection with the execution and delivery of this Amendment No. 4, Lease
Amendment No. 3 and Amendment No. 2 to TIA and all other agreements, documents
or instruments prepared in connection therewith.
(b) Lessee's Obligation. Notwithstanding Section 6(a) hereof or
-------------------
anything in Section 14 of the Participation Agreement to the contrary (i) in the
event the transactions contemplated by this Amendment No. 4 shall not be
consummated for any reason, the Lessee shall pay or cause to be paid, and shall
indemnify and hold harmless Funding Corp, New Funding Corp, the Indenture
Trustee, the Owner Trustee, the Collateral Trust Trustee and the Owner
Participant in respect of all Adjustment Transaction Expenses and (ii) in any
event, the Lessee shall pay or cause to be paid directly (and not as
Supplemental Rent) that portion of the Adjustment Transaction Expenses that
exceeds the Adjustment Transaction Expenses payable on behalf of the Owner
Trustee pursuant to clause (a) above and shall indemnify and hold the Lessor and
Owner Participant harmless for any such amount.
-5-
Section 7. Recordations and Filings.
------------------------
The Lessee agrees that it has caused, or will cause, to be made the
recordations and filings set forth in Schedule 2 hereto and that such filings
and recordations are all the recordations and filings that are necessary in
order to preserve, protect and perfect the Owner Trustee's rights and interests
under the Facility Lease, as amended to the date hereof, and the first and prior
security interest of the Indenture Trustee in the Lease Indenture Estate under
the Indenture, as amended.
Section 8. Miscellaneous.
-------------
(a) Execution. This Amendment No. 4 may be executed in any number of
---------
counterparts and by the different parties hereto on separate counterparts, each
of which, when so executed and delivered, shall be an original, but all such
counterparts shall together constitute but one and the same instrument. Although
this Amendment No. 4 is dated as of the date first above written for
convenience, the actual dates of execution hereof by the parties hereto are
respectively the dates set forth under the signatures hereto, and this Amendment
No. 4 shall not be effective until the Effective Date. This Amendment No. 4
amends and modifies the Participation Agreement and is to be read with and form
part of the Participation Agreement. On and from the Effective Date, any
reference in any Transaction Document to the Participation Agreement shall be
deemed to refer to the Participation Agreement as amended through and including
the date hereof.
(b) Governing Law. This Amendment No. 4 has been negotiated and
-------------
delivered in the State of New York and shall be governed by, and be construed in
accordance with, the law of the State of New York.
(c) Non-Waiver or Amendment. The agreements contained in
-----------------------
this Amendment No. 4 shall not, except as expressly provided in this
Amendment, operate as a waiver of any right, power or remedy of any
party under any Transaction Document, nor constitute, except as expressly
provided in this Amendment No. 4, a waiver of any provision of any Transaction
Document.
(d) Responsibility for Recitals. The recitals contained herein shall
---------------------------
not be taken as the statements of the Indenture Trustee and it shall assume no
responsibility for the correctness of same.
-6-
IN WITNESS WHEREOF, the parties hereto have each caused this Amendment
No. 4 to the Participation Agreement to be duly executed by their respective
officers thereunto duly authorized as of the dates set forth below.
BEAVER VALLEY TWO TAU LIMITED PARTNERSHIP
by Beaver Valley Two Tau, Inc., General
Partner
By:/s/ Arthur S. Penn
--------------------------------------
Title: President
Date: October 13, 1994
DQU FUNDING CORPORATION
By:/s/ Mark Ferrucci
--------------------------------------
Title: President
Date: October 13, 1994
DQU II FUNDING CORPORATION
By:/s/ Lannhi Tran
--------------------------------------
Title: Vice President
Date: October 13, 1994
THE FIRST NATIONAL BANK OF BOSTON, in
its individual capacity and as Owner
Trustee
By:/s/ J. E. Mogavero
--------------------------------------
Title: Authorized Officer
Date: October 13, 1994
THE BANK OF NEW YORK, in its individual
capacity and as Indenture Trustee
By:/s/ Mary Jane Morrissey
--------------------------------------
Title: Assistant Vice President
Date: October 13, 1994
DUQUESNE LIGHT COMPANY
By:/s/ James D. Mitchell
--------------------------------------
Title: Treasurer
Date: October 13, 1994
EXHIBIT A TO AMENDMENT NO. 4
TO PARTICIPATION AGREEMENT
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS AMENDED BY THIS
AMENDMENT NO. 3 THERETO HAVE BEEN ASSIGNED TO, AND ARE SUBJECT TO A SECURITY
INTEREST IN FAVOR OF, THE BANK OF NEW YORK, AS INDENTURE TRUSTEE UNDER A TRUST
INDENTURE, MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF FACILITY LEASE, DATED
AS OF SEPTEMBER 15, 1987, AS AMENDED. THIS AMENDMENT NO. 3 HAS BEEN EXECUTED IN
SEVERAL COUNTERPARTS. ONLY THE COUNTERPART MARKED "ORIGINAL" AND CONTAINING THE
RECEIPT THEREFOR BY THE INDENTURE TRUSTEE SHALL BE THE ORIGINAL COUNTERPART. SEE
SECTION 3(c) OF THIS AMENDMENT NO. 3 FOR INFORMATION CONCERNING THE RIGHTS OF
HOLDERS OF VARIOUS COUNTERPARTS HEREOF.
THIS COUNTERPART IS NOT THE ORIGINAL COUNTERPART.
================================================================================
AMENDMENT NO. 3
dated as of October 13, 1994
to
FACILITY LEASE
dated as of September 15, 1987
between
THE FIRST NATIONAL BANK OF BOSTON
not in its individual capacity but solely
as Owner Trustee under a Trust Agreement,
dated as of September 15, 1987, with
Beaver Valley Two Tau Limited Partnership,
Lessor
and
DUQUESNE LIGHT COMPANY,
Lessee
================================================================================
Original Facility Lease Recorded
on October 2, 1987 in Miscellaneous
Book Volume 1318, Page 406 in the Office of
the Recorder of Deeds, Beaver County, Pennsylvania.
Amendment No. 1 to Facility Lease Recorded
on December 22, 1987 in Miscellaneous Book
Volume 1325, Page 344 in the Office of the
Recorder of Deeds, Beaver County, Pennsylvania.
Amendment No. 2 to Facility Lease Recorded
on December 29, 1992 in Miscellaneous Book
Volume 1519, Page 075 in the Office of the
Recorder of Deeds, Beaver County, Pennsylvania.
================================================================================
AMENDMENT NO. 3, dated as of October 13, 1994 ("Amendment No. 3"), to
the Facility Lease, dated as of September 15, 1987, as amended to the date
hereof (as so amended, the "Facility Lease"), 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 September 15, 1987,
as amended to the date hereof, with Beaver Valley Two Tau Limited Partnership
(the "Lessor"), and DUQUESNE LIGHT COMPANY, a Pennsylvania 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, providing for the lease by the Lessor to the Lessee of the
Undivided Interest (such term and other capitalized terms used herein without
definition being defined as provided in Section 1);
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,
Modified Special Casualty Values and Special Termination Values in order to
preserve Net Economic Return in the event there is any change in the Code which
results in the marginal Federal income tax rate applicable to corporations
differing from the rate assumed to be applicable in the Pricing Assumptions as
in effect on the Closing Date; and
WHEREAS, by reason of the enactment of the Omnibus Budget
Reconciliation Act of 1993 (Pub. L. No. 103-66) ("Budget Reconciliation Act")
the marginal Federal income tax rate applicable to corporations increased from
34 percent to 35 percent for tax years beginning on or after January 1, 1993
and, as a result, the Lessor wishes to document amendments to the schedules of
Basic Rent, Casualty Values, Special Casualty Values, Modified Special Casualty
Values and Special Termination Values pursuant to Sections 3(d) and 3(f) of the
Facility Lease.
NOW, THEREFORE, intending to be legally bound hereby, 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 or in the recitals
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 to Facility Lease.
----------------------------
(a) Schedules
---------
(1) Schedule 1 to the Facility Lease entitled "Basic Rent
Payments" is deleted in its entirety and is hereby replaced with Schedule 1
hereto.
(2) Schedule 2 to the Facility Lease entitled "Schedule of
Casualty Values" is deleted in its entirety and is hereby replaced with Schedule
2 hereto.
(3) Schedule 3 to the Facility Lease entitled "Schedule of
Special Casualty Values" is deleted in its entirety and is hereby replaced with
Schedule 3 hereto.
(4) Schedule 4 to the Facility Lease entitled "Schedule of
Modified Special Casualty Values" is deleted in its entirety and is hereby
replaced with Schedule 4 hereto.
(5) Schedule 5 to the Facility Lease entitled "Schedule of
Special Termination Values" is deleted in its entirety and is hereby replaced
with Schedule 5 hereto.
(b) Definitions. Appendix A of the Facility Lease is amended as
-----------
set forth in Amendment No. 4 to the Participation Agreement dated as of the date
hereof among the Owner Participant, Lessee, Owner Trustee, Indenture Trustee,
Funding Corporation and New Funding Corporation ("Amendment No. 4 to
------------------
Participation Agreement") in respect of Appendix A thereto.
-----------------------
SECTION 3. Miscellaneous.
-------------
(a) Dating; References. Although this Amendment No. 3 is dated
------------------
as of the date first above written for convenience, the actual dates of
execution hereof by the parties hereto are respectively the dates set forth
under the signatures hereto, and this Amendment No. 3 shall be effective as of
the Effective Date (as defined in Amendment No. 4 to Participation Agreement).
This Amendment No. 3 amends and modifies the Facility Lease and is to be read
with and form part of the Facility Lease. On and after the Effective Date, any
reference in any Transaction Document to the Facility Lease shall be deemed to
refer to the Facility Lease, as amended through and including the date hereof.
(b) Governing Law. This Amendment No. 3 shall be governed by,
-------------
and be construed in accordance with, the law of the State of New York, provided,
however, that all matters relating to the creation of the leasehold estate
hereunder and the exercise of remedies with respect to such leasehold estate
shall be governed
-2-
by, and be construed in accordance with, the law of the Commonwealth of
Pennsylvania.
(c) Original Counterpart. The single executed original 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. No security interest in this Amendment No. 3 may be
created or continued through the transfer or possession of any counterpart other
than the "Original".
(d) Full Force and Effect. As amended hereby, the Facility Lease
---------------------
remains in full force and effect in accordance with its terms.
(e) Amendments in Writing. The terms of this
---------------------
Amendment No. 3 may not be waived, altered, modified, amended, supplemented or
terminated in any manner whatsoever except in accordance with the terms of the
Transaction Documents and by written instrument signed by the Lessor and the
Lessee.
(f) Counterpart Execution. This Amendment No. 3 may be executed
---------------------
in any number of counterparts and by each of the parties hereto or thereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.
(g) Non-Waiver or Amendment. The agreements contained in this
-----------------------
Amendment No. 3 shall not, except as expressly provided in this Amendment No. 3,
operate as a waiver of any right, power or remedy of any party under any of the
Transaction Document nor constitute, except as expressly provided in this
Amendment No. 3, a waiver of any provision of any Transaction Document.
-3-
IN WITNESS WHEREOF, intending to be legally bound, each of the parties
hereto has caused this Amendment No. 3 to Facility Lease to be duly executed 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 September 15,
1987, with Beaver Valley
Two Tau Limited Partnership
By: ______________________
Date: ______________, 1994
DUQUESNE LIGHT COMPANY
By: ______________________
Date: ______________, 1994
STATE OF NEW YORK
COUNTY OF NEW YORK
BEFORE ME, a Notary Public in and for said County and State the above-
named DUQUESNE LIGHT COMPANY, _____________________________, its __________, who
acknowledged that he did sign the foregoing instrument on behalf of said
Corporation by authority of its Board of Directors and that the same is the free
act and deed of said Corporation and his free act and deed individually and as
such officer.
IN TESTIMONY WHEREOF, I have hereunto set my, hand and official seal
at New York, New York this _______ day of ____________, 1994.
-----------------------
Notary Public
My Commission Expires ___________
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BEFORE ME, a Notary Public in and for said County and State,personally
appeared the above-named THE FIRST NATIONAL BANK OF BOSTON, by its Authorized
Officer, who acknowledged that he did sign the foregoing instrument on behalf of
said national banking association by authority of its Board of Directors and
that the same is the free act and deed of said national banking association and
his free act and deed individually and as such officer.
IN TESTIMONY WHEREOF, I have of hereunto set my hand and official seal
at New York, New York this _________ day of ______________, 1994.
__________________________________
Notary Public
My Commission Expires __________________
SCHEDULE 1
Tau
---
Schedule of Basic
Rent Payments
-----------------
Date Payment Amount
---- ------- ------
June 1, 1988 1 5.02553936
December 1, 1988 2 5.02553936
June 1, 1989 3 5.02553936
December 1, 1989 4 5.02553936
June 1, 1990 5 5.02553936
December 1, 1990 6 5.02553936
June 1, 1991 7 5.02553936
December 1, 1991 8 5.02553936
June 1, 1992 9 5.02553936
December 1, 1992 10 5.02553936
June 1, 1993 11 4.82726810
December 1, 1993 12 3.42643435
June 1, 1994 13 4.82726810
December 1, 1994 14 3.59363953
June 1, 1995 15 3.41928577
December 1, 1995 16 5.00162186
June 1, 1996 17 3.36138926
December 1, 1996 18 5.05951837
June 1, 1997 19 3.30000190
December 1, 1997 20 5.12090574
June 1, 1998 21 3.23419708
December 1, 199 22 5.18671056
June 1, 1999 23 3.49234030
December 1, 199 24 4.92856734
June 1, 2000 25 3.07462077
December 1,2000 26 3.34628687
June 1, 201 27 3.42956230
December , 2001 28 4.99134534
June 1, 002 29 3.39003384
December 1, 2002 30 5.03087480
June 1 2003 31 3.63808558
December 1, 2003 32 6.65163505
June 1, 2004 33 3.61596432
December 1, 2004 34 6.67375631
June 1, 2005 35 3.52944245
December 1,2005 36 6.76027818
June 1, 2006 37 3.43970996
December 1, 2006 38 6.85001067
June 1, 2007 39 3.34753321
December 1, 2007 40 6.94218742
June 1, 2008 41 3.35573031
December 1, 2008 42 6.93399032
June 1, 2009 43 7.47605296
December 1, 2009 44 2.81366767
June 1, 2010 45 7.61239942
December 1, 2010 46 2.67732121
June 1, 2011 47 7.71845622
December 1, 2011 48 2.57126441
June 1, 2012 49 9.20318915
December 1, 2012 50 1.08653148
June 1, 2013 51 9.54003666
December 1, 2013 52 0.74968397
June 1, 2014 53 9.93980701
December 1, 2014 54 0.34991362
June 1, 2015 55 10.28972063
December 1, 2015 56 0.00000000
June 1, 2016 57 9.92465933
December 1, 2016 58 0.36506130
June 1, 2017 59 5.14486032
------------
Totals 283.49821393
SCHEDULE 2
Schedule of
Casualty Values
---------------
October 13, 1994 120.36756238
December 1, 1994 120.37759389
June 1, 1995 120.90263655
December 1, 1995 119.74762800
June 1, 1996 120.08923082
December 1, 1996 118.62627170
June 1, 1997 118.80439919
December 1, 1997 117.16703392
June 1, 1998 117.35614793
December 1, 1998 115.59849327
June 1, 1999 115.47060127
December 1, 1999 113.90069995
June 1, 2000 114.11386166
December 1, 2000 112.06183258
June 1, 2001 111.85002620
December 1, 2001 110.08294484
June 1, 2002 109.85451846
December 1, 2002 107.99236004
June 1, 2003 107.46137722
December 1, 2003 103.92635798
June 1, 2004 103.30276811
December 1, 2004 99.62871886
June 1, 2005 98.97037729
December 1, 2005 95.08901766
June 1, 2006 94.39240812
December 1, 2006 90.29376106
June 1, 2007 89.55426743
December 1, 2007 85.22888082
June 1, 2008 84.34039250
December 1, 2008 79.88371128
June 1, 2009 74.73408454
December 1, 2009 74.07009595
June 1, 2010 68.62131112
December 1, 2010 67.92057247
June 1, 2011 62.19402524
December 1, 2011 61.42028750
June 1, 2012 54.03025480
December 1, 2012 54.49220860
June 1, 2013 46.62629964
December 1, 2013 47.29563522
June 1, 2014 38.92082107
December 1, 2014 39.91868005
June 1, 2015 31.15043931
December 1, 2015 32.36960887
June 1, 2016 23.85585162
December 1, 2016 24.25931266
June 1, 2017 20.00000000
SCHEDULE 3
Schedule of Special
Casualty Values
--------------------
October 13, 1994 117.78710714
December 1, 1994 117.77645630
June 1, 1995 118.22248288
December 1, 1995 116.98605793
June 1, 1996 117.24377113
December 1, 1996 115.69437403
June 1, 1997 115.78343778
December 1, 1997 114.05430322
June 1, 1998 114.14886023
December 1, 1998 112.29377615
June 1, 1999 112.06549508
December 1, 1999 110.39215511
June 1, 2000 110.49873597
December 1, 2000 108.33688838
June 1, 2001 108.01192746
December 1, 2001 106.12825422
June 1, 2002 105.77969419
December 1, 2002 103.79375276
June 1, 2003 103.13522671
December 1, 2003 99.46878979
June 1, 2004 98.70979010
December 1, 2004 94.89621762
June 1, 2005 94.09411445
December 1, 2005 90.06462610
June 1, 2006 89.21538806
December 1, 2006 84.95947602
June 1, 2007 84.05794009
December 1, 2007 79.56558875
June 1, 2008 78.50506373
December 1, 2008 73.87111975
June 1, 2009 68.53884545
December 1, 2009 67.68666093
June 1, 2010 62.04396324
December 1, 2010 61.14342115
June 1, 2011 55.21100093
December 1, 2011 54.22513631
June 1, 2012 46.61653284
December 1, 2012 46.85327623
June 1, 2013 38.75531553
December 1, 2013 39.18555021
June 1, 2014 30.56437189
Decembers 1, 2014 31.30838274
June 1, 2015 22.27858262
December 1, 2015 23.22824727
June 1, 2016 14.43679822
December 1, 2016 14.55413188
June 1, 2017 10.00000000
SCHEDULE 4
Schedule of Modified
Special Casualty Values
------------------------
October 13, 1994 35.33179726
December 1, 1994 35.34505212
June 1, 1995 35.70919251
December 1, 1995 35.97368725
June 1, 1996 36.14531970
December 1, 1996 36.20761373
June 1, 1997 36.20761373
December 1, 1997 36.20761373
June 1, 1998 36.20703687
December 1, 1998 36.20703687
June 1, 1999 36.20547569
December 1, 1999 36.20547569
June 1, 2000 36.20267314
December 1, 2000 36.20267314
June 1, 2001 36.04194446
December 1, 2001 35.60346237
June 1, 2002 35.22630762
December 1, 2002 34.75742513
June 1, 2003 34.35496137
December 1, 2003 33.57065625
June 1, 2004 32.85479521
December 1, 2004 31.95949148
June 1, 2005 31.20225149
December 1, 2005 30.25547016
June 1, 2006 29.45504576
December 1, 2006 28.45216945
June 1, 2007 27.60598990
December 1, 2007 26.54132803
June 1, 2008 25.64444806
December 1, 2008 24.41150135
June 1, 2009 23.35198698
December 1, 2009 22.10779615
June 1, 2010 21.06991736
December 1, 2010 19.77447759
June 1, 2011 18.67731942
December 1, 2011 17.26998584
June 1, 2012 16.07473633
December 1, 2012 14.59591579
June 1, 2013 14.71940853
December 1, 2013 13.84135093
June 1, 2014 14.16393146
December 1, 2014 14.65409421
June 1, 2015 15.30254171
December 1, 2015 14.08688567
June 1, 2016 14.94240416
December 1, 2016 5.21401239
June 1, 2017 5.14486031
SCHEDULE 5
Schedule of Special
Termination Values
------------------
October 13, 1994 121.65779000
December 1, 1994 121.67816268
June 1, 1995 122.24271339
December 1, 1995 121.12841303
June 1, 1996 121.51196066
December 1, 1996 120.09222053
June 1, 1997 120.31487990
December 1, 1997 118.72339927
June 1, 1998 118.95979178
December 1, 1998 117.25085183
June 1, 1999 117.17315437
December 1, 1999 115.65497237
June 1, 2000 115.92142451
December 1, 2000 113.92430469
June 1, 2001 113.76907557
December 1, 2001 112.06029014
June 1, 2002 111.89193059
December 1, 2002 110.09166368
June 1, 2003 109.62445247
December 1, 2003 106.15514207
June 1, 2004 105.59925711
December 1, 2004 101.99496948
June 1, 2005 101.40850871
December 1, 2005 97.60121344
June 1, 2006 96.98091815
December 1, 2006 92.96090358
June 1, 2007 92.30243109
December 1, 2007 88.06052686
June 1, 2008 87.25805689
December 1, 2008 82.89000705
June 1, 2009 77.83170408
December 1, 2009 77.26181346
June 1, 2010 71.90998506
December 1, 2010 71.30914813
June 1, 2011 65.68553739
December 1, 2011 65.01786310
June 1, 2012 57.73711578
December 1, 2012 58.31167478
June 1, 2013 50.56179169
December 1, 2013 51.35067772
June 1, 2014 43.09904567
December 1, 2014 44.22382870
June 1, 2015 35.58636765
December 1, 2015 36.94028967
June 1, 2016 28.56537832
December 1, 2016 29.11190305
June 1, 2017 25.00000000
EXHIBIT B
TO AMENDMENT NO. 4 TO
PARTICIPATION AGREEMENT
-----------------------
[INTENTIONALLY OMITTED]
EXHIBIT C
SCHEDULE 1 TO AMENDMENT
TO THE NEW FIXED RATE NOTE NO. 4 TO
(DUE JUNE 1, 1999) PARTICIPATION AGREEMENT
Schedule of Principal Amortization
Debt
Date Drawndown Service Interest Principal Balance
---- --------- ------- -------- --------- -------
December 8, 1992 1,726,600.00 1,726.000.00
June 1, 1993 59,968.43 59,968.43 0.00 1,726.000.00
December 1, 1993 62,394.90 62,394.90 0.00 1,726.000.00
June 1, 1994 62,394.90 62,394.90 0.00 1,726.000.00
December 1, 1994 62,394.90 62,394.90 0.00 1,726.000.00
June 1, 1995 62,394.90 62,394.90 0.00 1,726.000.00
December 1, 1995 412,394.90 62,394.90 350.000.00 1,376.000.00
June 1, 1996 49,742.40 49.742.40 0.00 1,376.000.00
December 1, 1996 452,742.40 49.742.40 403,000.00 973,000.00
June 1, 1997 35,173.95 35,173.95 0.00 973,000.00
December 1, 1997 467,173.95 35,173.95 432,000.00 541,000.00
June 1, 1998 19,557.15 19,557.15 0.00 541,000.00
December 1, 1998 482,557.15 19,557.15 463,000.00 78.000.00
June 1, 1999 80,819.70 2,819.70 78,000.00 0.00
December 1, 1999 0.00 0.00 0.00 0.00
June 1, 2000 0.00 0.00 0.00 0.00
December 1, 2000 0.00 0.00 0.00 0.00
June 1, 2001 0.00 0.00 0.00 0.00
December 1, 2001 0.00 0.00 0.00 0.00
June 1, 2002 0.00 0.00 0.00 0.00
December 1, 2002 0.00 0.00 0.00 0.00
June 1, 2003 0.00 0.00 0.00 0.00
December 1, 2003 0.00 0.00 0.00 0.00
June 1, 2004 0.00 0.00 0.00 0.00
December 1, 2004 0.00 0.00 0.00 0.00
June 1, 2005 0.00 0.00 0.00 0.00
December 1, 2005 0.00 0.00 0.00 0.00
June 1, 2006 0.00 0.00 0.00 0.00
December 1, 2006 0.00 0.00 0.00 0.00
June 1, 2007 0.00 0.00 0.00 0.00
December 1, 2007 0.00 0.00 0.00 0.00
June 1, 2008 0.00 0.00 0.00 0.00
December 1, 2008 0.00 0.00 0.00 0.00
June 1, 2009 0.00 0.00 0.00 0.00
December 1, 2009 0.00 0.00 0.00 0.00
June 1, 2010 0.00 0.00 0.00 0.00
December 1, 2010 0.00 0.00 0.00 0.00
June 1, 2011 0.00 0.00 0.00 0.00
December 1, 2011 0.00 0.00 0.00 0.00
June 1, 2012 0.00 0.00 0.00 0.00
December 1, 2012 0.00 0.00 0.00 0.00
June 1, 2013 0.00 0.00 0.00 0.00
December 1, 2013 0.00 0.00 0.00 0.00
June 1, 2014 0.00 0.00 0.00 0.00
December 1, 2014 0.00 0.00 0.00 0.00
June 1, 2015 0.00 0.00 0.00 0.00
December 1, 2015 0.00 0.00 0.00 0.00
June 1, 2016 0.00 0.00 0.00 0.00
December 1, 2016 0.00 0.00 0.00 0.00
June 1, 2017 0.00 0.00 0.00 0.00
--------------- --------- --------- ----------
Totals 1,726,000.00 2,309,709.63 583,709.63 1,726,000.00
C-1
SCHEDULE 1
TO THE NEW FIXED RATE NOTE
(DUE JUNE 1, 2015)
Schedule of Principal Amortization
Debt
Date Drawndown Service Interest Principal Balance
---- --------- ------- -------- --------- -------
December 8, 1992 7,259,000.00
June 1,1993 721,570.02 721,570.02 0.00 17,259,000.00
December 1, 1993 750,766.50 750,766.50 0.00 17,259,000.00
June 1, 1994 750,766.50 750,766.50 0.00 17,259,000.00
December 1, 1994 789,766.50 750,766.50 39,000.00 17,220,000.00
June 1, 1995 749,070.00 749,070.00 0.00 17,220,000.00
December 1, 1995 774,070.00 749,070.00 25,000.00 17,195,000.00
June 1, 1996 747,982.50 747,982.50 0.00 17,195,000.00
December 1, 1996 747,982.50 747,982.50 0.00 17,195,000.00
June 1, 1997 747,982.50 747,982.50 0.00 17,195,000.00
December 1, 1997 747,982.50 747,982.50 0.00 17,195,000.00
June 1, 1998 747,982.50 747,982.50 0.00 17,195,000.00
December 1, 1998 747,982.50 747,982.50 0.00 17,195,000.00
June 1, 1999 747,982.50 747,982.50 0.00 17,195,000.00
December 1, 1999 1,168,982.50 747,982.50 421,000.00 16,774,000.00
June 1, 2000 729,669.00 729,669.00 0.00 16,774,000.00
December 1, 2000 1,228,669.00 729,669.00 499,000.00 16,275,000.00
June 1, 2001 707,962.50 707,962.50 0.00 16,275,000.00
December 1, 2001 1,092,962.50 707,962.50 385,000.00 15,890,000.00
June 1, 2002 691,215.00 691,215.00 0.00 15,890,000.00
December 1, 2002 1,095,215.00 691,215.00 404,000.00 15,486,000.00
June 1, 2003 673,641.00 673,641.00 0.00 15,486,000.00
December 1, 2003 1,404,641.00 673,641.00 731,000.00 14,755,000.00
June 1,2004 641,842.50 641,842.50 0.00 14,755,000.00
December 1, 2004 1,399,814.50 641,842.50 758,000.00 13,997,000.00
June 1, 2005 608,869,50 608,869.50 0.00 13,197,000.00
December 1, 2005 1,409,869.50 608,869.50 801,000.00 13,196,000.00
June 1, 2006 574,026.00 574,026.00 0.00 13,196,000.00
December 1, 2006 1,420,026.00 574,026.00 864,000.00 12,350,000.00
June 1, 2007 537,225.00 537,225.00 0.00 12,350,000.00
December 1, 2007 1,429,225.00 537,225.00 892,000.00 11,458,000.00
June 1, 2008 498,423.00 498,423.00 0.00 11,458,000.00
December 1, 2008 1,388,423.00 498,423.00 890,000,00 10,568,000.00
June 1, 2009 1,473,708,00 459,708.00 1,014,000.00 9,554,000.00
December 1, 2009 415,599.00 415,599.00 0.00 9,554,000.00
June 1, 2010 1,493,599.00 415,599.00 1,078,000.00 8,476,000.00
December 1 2010 368,706.00 368,706.00 0.00 8,476,000.00
June 1, 2011 1,491,706.00 368,706.00 1,123,000.00 7,353,000.00
December 1, 2011 319,855.50 319,855.50 0.00 7,353,000.00
June 1, 2012 1,826,855.50 319,855.50 1,507,000.00 5,846,000.00
December 1, 2012 254,301.00 254,301.00 0.00 5,846,000.00
June 1,2013 2,010,301.00 254,301.00 1,756,000.00 4,090,000.00
December 1, 2013 177,915.00 177,915.00 0.00 4,090,000.00
June 1, 2014 2,358,915.00 177,915.00 2,181,000.00 1,909,000.00
December 1, 2014 83,041.50 83,041.50 0.00 1,909,000.00
June 1, 2015 1,992,041.50 83,041.50 1,909,000.00 0.00
December 1, 2015 0.00 0.00 0.00 0.00
June 1, 2016 0.00 0.00 0.00 0.00
December 1, 2016 0.00 0.00 0.00 0.00
June 1, 2017 0.00 0.00 0.00 0.00
----------------- ------------ ------------ ------------
Totals 7,259,000.00 42,739.160.52 25,480,160.52 17,259.000.00
C-2
SCHEDULE 1A
TO AMENDMENT NO. 4 TO
PARTICIPATION AGREEMENT
-----------------------
SCHEDULE 5 TO PARTICIPATION AGREEMENT
DUQUESNE LIGHT COMPANY BEAVER VALLEY UNIT 2
COLLATERALIZED LEASE BONDS -- PRICING ASSUMPTIONS
FROM CLOSING DATE UP TO AND INCLUDING DECEMBER 7, 1992
------------------------------------------------------
Basic Rent, Casualty Value, Special Casualty Value, Modified Special
Casualty Value and Special Termination Value as set forth in the Facility Lease,
as originally executed, have been computed on the basis of the following pricing
assumptions:
1. Investment Percentage: 20.0 percent
2. Debt Percentage: 80.0 percent
3. Interest Rate on Notes: 12.0 percent per annum
4. Federal ACRS Deductions: 10-year public utility property
deductions on the basis of 100.0
percent of Facility cost.
5. Investment Tax Credit: 0.0 percent of Facility Cost.
6. Owner Participant's Tax Year-End: December 31
7. Closing Date: October 2, 1987
8. Transaction Expenses: 1.5 percent of Facility Cost paid
on October 2, 1987 by the Owner
Participant in addition to its
Investment (amortized on a
straight-line basis during the
Base Lease Term).
9. Basic Rent Payment Date: June 1 and December 1 of each
year (rent payable in arrears).
PAGE 2 TO
SCHEDULE 1A
TO AMENDMENT NO. 4 TO
PARTICIPATION AGREEMENT
-----------------------
DUQUESNE LIGHT COMPANY BEAVER VALLEY UNIT 2
COLLATERALIZED LEASE BONDS -- PRICING ASSUMPTIONS
FROM CLOSING DATE UP TO AND INCLUDING DECEMBER 7, 1992 (CONTINUED)
------------------------------------------------------------------
10. First Basic Rent Payment Date: June 1, 1988
11. Last Basic Rent Payment Date: June 1, 2017
12. Interim Rent Payment Date: December 1, 1987
13. Rent Structure: Semi-annual Arrears
14. Owner Participant's Marginal
Federal Tax Rates: 39.95068 percent in 1987; 34
percent thereafter.
15. Owner Participant's Marginal State
Tax Rate: 0 percent
16. State and City Deductions: None.
17. First Estimated Tax Payment Date: December 15, 1987
18. Owner Participant's Short First
Tax Year: Commences October 2, 1987
19. Tax Accounting Method: Accrual
20. Amortization of Notes: See Amortization Schedule in
Notes.
21. Undivided Interest Percentage: 0.6061814 percent of Unit 2.
22. Facility Cost: $23,732,000
23. Purchase Price: 100 percent of Facility Cost.
Note: Interim Rent was calculated assumiung a Closing Date of October 2,
1987.
SCHEDULE 1B
TO AMENDMENT NO. 4 TO
PARTICIPATION AGREEMENT
-----------------------
DUQUESNE LIGHT COMPANY BEAVER VALLEY UNIT 2
COLLATERALIZED LEASE BONDS -- ADDITIONAL PRICING ASSUMPTIONS
BEGINNING DECEMBER 8, 1992, AS ADJUSTED FOR REFINANCING,
UP TO AND INCLUDING October 12, 1994
------------------------------------
Basic Rent, Casualty Value, Special Casualty Value, Modified
Special Casualty Value and Special Termination Value as set forth in the
Facility Lease, as amended by Amendment No. 2 thereto, have been computed on the
basis of the following additional pricing assumptions:
24. Refinancing Closing Date: December 8, 1992
25. Redemption Date: December 8, 1992
26. Interest Rates on New Fixed
Rate Notes:
Series Due 1999: 7.23%
Series Due 2016: 8.70%
27. Amortization of New Fixed
Rate Notes: See Amortization Schedule in New
Fixed Rate Notes.
28. Amount of New Fixed Rate Notes:
Series Due 1999: $1,726,000
Series Due 2016: $17,259,000
29. INTENTIONALLY OMITTED
PAGE 2 TO
SCHEDULE 1B
TO AMENDMENT NO. 4
TO PARTICIPATION AGREEMENT
--------------------------
DUQUESNE LIGHT COMPANY BEAVER VALLEY UNIT 2 COLLATERALIZED
LEASE BONDS -- ADDITIONAL PRICING ASSUMPTIONS BEGINNING
DECEMBER 8, 1992, AS ADJUSTED FOR REFINANCING, UP TO AND
INCLUDING OCTOBER 12, 1994 (CONTINUED)
--------------------------------------
30. Notes to be Redeemed on 12/8/92: $18,736,000
31. Additional Equity Investment: $359,206
32. Refinancing Transaction
Expenses: 0.875 percent of Facility Cost paid on the
Refinancing Closing Date by funds provided
to the Owner Trustee (amortized on a
stright-line basis during the remaining
lease term which shall begin on the
Refinancing Closing Date and end on the
last Basic Rent Payment Date).
33. Transaction Expense
Percentage: 4.4118 percent
34. Supplemental Rent Payment on
the Refinancing Closing Date: $1,228,024 as calculated with reference to
Section 2(g) of the Refinancing Agreement
(Supplemental Rent of $1,184,824 plus
accrued interest on Fixed Rate Notes of
$43,200).
SCHEDULE 1C
TO AMENDMENT NO. 4
TO PARTICIPATION AGREEMENT
--------------------------
DUQUESNE LIGHT COMPANY BEAVER VALLEY UNIT 2
COLLATERALIZED LEASE BONDS -- ADDITIONAL PRICING
ASSUMPTIONS BEGINNING OCTOBER 13, 1994
--------------------------------------
Basic Rent, Casualty Value, Speacial Casualty Value, Modified
Special Casualty Value and Special Termination Value as set forth in the
Facility Lease, as amended by Amendment No. 3 thereto, have been computed on the
basis of the following additional pricing assumptions:
35. Adjustment Transaction
Expenses: $31,000.00 paid on the Tax Rate
Adjustment Closing Date pursuant to
Section 6(a) of the Amendment No. 4 to
Participation Agreement by the Lessee on
behalf of the Owner Trustee (amortized
by the Owner Trustee on a straight-line
basis during the remaining Base Lease
Term).
36. Owner Participant's
Marginal Federal Tax Rates. 39.95068 percent in 1987; 34 percent in
1988, 1989, 1990, 1991 and 1992; 35
percent thereafter.
37. Reoptimized Amortization
of Notes: See Amortization Schedules in Exhibit C
to Amendment No. 4 to Participation
Agreement.
38. Tax Rate Adjustment
Closing Date: October 13, 1994
SCHEDULE 2
TO AMENDMENT NO. 4 TO
PARTICIPATION AGREEMENT
-----------------------
RECORDATIONS AND FILINGS
------------------------
Filing of Amendment No. 3 to Facility Lease in the Office of the
Recorder of Deeds, Beaver County, Pennsylvania.