SEC Info - Pinnacle West Capital Corp, et al. - ‘10-Q’ for 9/30/15

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Pinnacle West Capital Corp, et al. – ‘10-Q’ for 9/30/15 – ‘EX-10.2’

On: Friday, 10/30/15, at 8:33am ET · For: 9/30/15 · Accession #: 764622-15-69 · File #s: 1-04473, 1-08962

  As Of               Filer                 Filing    For·On·As Docs:Size

10/30/15  Pinnacle West Capital Corp        10-Q        9/30/15   87:13M
          Arizona Public Service Co

Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Quarterly Report                                    HTML   1.00M 
 2: EX-10.1     Material Contract                                   HTML    525K 
 3: EX-10.2     Material Contract                                   HTML     65K 
 4: EX-10.3     Material Contract                                   HTML     63K 
 5: EX-12.1     Statement re: Computation of Ratios                 HTML     42K 
 6: EX-12.2     Statement re: Computation of Ratios                 HTML     44K 
 7: EX-12.3     Statement re: Computation of Ratios                 HTML     56K 
 8: EX-31.1     Certification -- §302 - SOA'02                      HTML     31K 
 9: EX-31.2     Certification -- §302 - SOA'02                      HTML     31K 
10: EX-31.3     Certification -- §302 - SOA'02                      HTML     31K 
11: EX-31.4     Certification -- §302 - SOA'02                      HTML     31K 
12: EX-32.1     Certification -- §906 - SOA'02                      HTML     28K 
13: EX-32.2     Certification -- §906 - SOA'02                      HTML     28K 
60: R1          Document and Entity Information                     HTML     51K 
48: R2          Condensed Consolidated Statements of Income         HTML    125K 
                (Unaudited)                                                      
58: R3          Condensed Consolidated Statements of Comprehensive  HTML     58K 
                Income (Unaudited)                                               
63: R4          Condensed Consolidated Statements of Comprehensive  HTML     35K 
                Income (Unaudited) (Parenthetical)                               
81: R5          Condensed Consolidated Balance Sheets (Unaudited)   HTML    264K 
50: R6          Condensed Consolidated Balance Sheets (Unaudited)   HTML     35K 
                (Parenthetical)                                                  
57: R7          Condensed Consolidated Statements of Cash Flows     HTML    166K 
                (Unaudited)                                                      
44: R8          Condensed Consolidated Statements of Changes in     HTML     90K 
                Equity (Unaudited)                                               
35: R9          Consolidation and Nature of Operations              HTML     41K 
82: R10         Long-Term Debt and Liquidity Matters                HTML     55K 
65: R11         Regulatory Matters                                  HTML    198K 
64: R12         Retirement Plans and Other Benefits                 HTML     89K 
70: R13         Income Taxes                                        HTML     32K 
71: R14         Palo Verde Sale Leaseback Variable Interest         HTML     44K 
                Entities                                                         
68: R15         Derivative Accounting                               HTML    170K 
72: R16         Commitments and Contingencies                       HTML     73K 
59: R17         Other Income and Other Expense                      HTML     97K 
61: R18         Earnings Per Share                                  HTML     55K 
67: R19         Fair Value Measurements                             HTML    300K 
87: R20         Nuclear Decommissioning Trusts                      HTML     78K 
77: R21         New Accounting Standards                            HTML     34K 
54: R22         Changes in Accumulated Other Comprehensive Loss     HTML    117K 
66: R23         Asset Retirement Obligations                        HTML     37K 
56: R24         New Accounting Standards (Policies)                 HTML     29K 
28: R25         Consolidation and Nature of Operations (Tables)     HTML     35K 
78: R26         Long-Term Debt and Liquidity Matters (Tables)       HTML     43K 
84: R27         Regulatory Matters (Tables)                         HTML    147K 
39: R28         Retirement Plans and Other Benefits (Tables)        HTML     82K 
38: R29         Palo Verde Sale Leaseback Variable Interest         HTML     38K 
                Entities (Tables)                                                
42: R30         Derivative Accounting (Tables)                      HTML    236K 
43: R31         Other Income and Other Expense (Tables)             HTML     95K 
45: R32         Earnings Per Share (Tables)                         HTML     53K 
26: R33         Fair Value Measurements (Tables)                    HTML    281K 
75: R34         Nuclear Decommissioning Trusts (Tables)             HTML     80K 
52: R35         Changes in Accumulated Other Comprehensive Loss     HTML    112K 
                (Tables)                                                         
55: R36         Asset Retirement Obligations (Tables)               HTML     33K 
31: R37         Consolidation and Nature of Operations (Details)    HTML     34K 
86: R38         Long-Term Debt and Liquidity Matters - Narrative    HTML    129K 
                (Details)                                                        
20: R39         Long-Term Debt and Liquidity Matters - Estimated    HTML     34K 
                Fair Value of Long-Term Debt (Details)                           
46: R40         Regulatory Matters (Details)                        HTML    252K 
80: R41         Regulatory Matters - Four Corners and Cholla        HTML     49K 
                (Details)                                                        
30: R42         Regulatory Matters - Schedule of Regulatory Assets  HTML     69K 
                (Details)                                                        
37: R43         Regulatory Matters - Schedule of Regulatory         HTML     57K 
                Liabilities (Details)                                            
41: R44         Retirement Plans and Other Benefits - Narrative     HTML     55K 
                (Details)                                                        
49: R45         Retirement Plans and Other Benefits - Schedule of   HTML     56K 
                Net Benefit Cost (Details)                                       
25: R46         Income Taxes (Details)                              HTML     31K 
34: R47         Palo Verde Sale Leaseback Variable Interest         HTML     70K 
                Entities - Narrative (Details)                                   
22: R48         Palo Verde Sale Leaseback Variable Interest         HTML     39K 
                Entities - Schedule of VIEs (Details)                            
79: R49         Derivative Accounting - Narrative (Details)         HTML     54K 
29: R50         Derivative Accounting - Schedule of Gross Notional  HTML     29K 
                Amounts Outstanding (Details)                                    
76: R51         Derivative Accounting - Gains and Losses from       HTML     49K 
                Derivative Instruments (Details)                                 
32: R52         Derivative Accounting - Derivative Instruments in   HTML     92K 
                the Balance Sheets (Details)                                     
47: R53         Derivative Accounting - Credit Risk and Credit      HTML     33K 
                Related Contingent Features (Details)                            
21: R54         Commitments and Contingencies - Palo Verde Nuclear  HTML     90K 
                Generating Station and Contractual Obligations                   
                (Details)                                                        
24: R55         Commitments and Contingencies - Superfund-Related   HTML     50K 
                Matters, Southwest Power Outage and Clean Air Act                
                (Details)                                                        
40: R56         Commitments and Contingencies - Environmental       HTML     72K 
                Matters and Financial Assurances (Details)                       
27: R57         Other Income and Other Expense (Details)            HTML     50K 
83: R58         Earnings Per Share (Details)                        HTML     47K 
51: R59         Fair Value Measurements - Assets and Liabilities    HTML     98K 
                Measured on a Recurring Basis (Details)                          
69: R60         Fair Value Measurements - Significant Unobservable  HTML     63K 
                Inputs Used to Value Level 3 Instruments (Details                
                2)                                                               
33: R61         Fair Value Measurements - Level 3 Rollforward       HTML     44K 
                Derivatives (Details)                                            
36: R62         Nuclear Decommissioning Trusts (Details)            HTML     75K 
74: R63         Changes in Accumulated Other Comprehensive Loss     HTML     54K 
                (Details)                                                        
73: R64         Asset Retirement Obligations Narrative (Details)    HTML     46K 
53: R65         Asset Retirement Obligations Roll-Forward           HTML     40K 
                (Details)                                                        
85: XML         IDEA XML File -- Filing Summary                      XML    145K 
23: EXCEL       IDEA Workbook of Financial Reports                  XLSX    109K 
14: EX-101.INS  XBRL Instance -- pnw-20150630                        XML   4.04M 
16: EX-101.CAL  XBRL Calculations -- pnw-20150630_cal                XML    294K 
17: EX-101.DEF  XBRL Definitions -- pnw-20150630_def                 XML   1.14M 
18: EX-101.LAB  XBRL Labels -- pnw-20150630_lab                      XML   2.33M 
19: EX-101.PRE  XBRL Presentations -- pnw-20150630_pre               XML   1.28M 
15: EX-101.SCH  XBRL Schema -- pnw-20150630                          XSD    262K 
62: ZIP         XBRL Zipped Folder -- 0000764622-15-000069-xbrl      Zip    377K

‘EX-10.2’ — Material Contract

This Exhibit is an HTML Document rendered as filed. [ Alternative Formats ]

<! C: C:

Exhibit

Exhibit 10.2

AMENDMENT NO. 4

Dated as of September 30, 2015 to

FACILITY LEASE (Unit 2)

dated as of August 1, 1986,

as heretofore amended,

between

U.S. BANK NATIONAL ASSOCIATION

(successor to State Street Bank and Trust Company, successor to

The First National Bank of Boston), not in its individual capacity,

but solely as Owner Trustee under a Trust

Agreement, dated as of August 1, 1986,

with Emerson Finance LLC (formerly Emerson Finance Co.)

Lessor

and

ARIZONA PUBLIC SERVICE COMPANY,

Lessee

A 5.2326% UNDIVIDED INTEREST IN

PALO VERDE NUCLEAR GENERATING STATION UNIT 2

Original Facility Lease recorded August 18, 1986, as Instrument No. 86-439438, and Amendment No. 1, recorded November 21, 1986, as Instrument No. 86-645156, Amendment No. 2, recorded September 16, 1987, as Instrument No. 87-579420, and Amendment No. 3, recorded March 22, 1993, as Instrument No. 93-0165872, all in the Maricopa County, Arizona Recorder’s Office

AMENDMENT NO. 4, dated as of September 30, 2015 (this “Amendment”), to the Facility Lease dated as of August 1, 1986, as heretofore amended, between U.S. BANK NATIONAL ASSOCIATION (successor to State Street Bank and Trust Company, successor to The First National Bank of Boston), not in its individual capacity, but solely as Owner Trustee under a Trust Agreement, dated as of August 1, 1986, with Emerson Finance LLC (formerly Emerson Finance Co.),(the “Lessor”), and ARIZONA PUBLIC SERVICE COMPANY, an Arizona corporation (the “Lessee”).

WITNESSETH

WHEREAS, the Lessee and the Lessor have heretofore entered into a Facility Lease dated as of August 1, 1986, 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 (capitalized terms used in this Amendment without definition having the respective meanings assigned thereto in Appendix A to the Facility Lease);

WHEREAS, the Lessee has given notice of its exercise of the renewal option permitted in Section 12(a) of the Facility Lease upon expiration of the Basic Lease Term, which notice is irrevocable as to the Lessee as provided in Section 13(a) of the Facility Lease;

WHEREAS, the Lessee and the Lessor have agreed that, subject to the terms and conditions hereof, the Fixed Rate Renewal Term shall end on December 31, 2033; and

WHEREAS, the Lessee and the Lessor desire to amend the Facility Lease effective as of the end of the Basic Lease Term as set forth in Section 1 hereof in order to implement the foregoing;

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. Acknowledgements; Amendments.

The parties acknowledge and agree that:

(x) the Lessee has given notice of its exercise of the renewal option permitted in Section 12(a) of the Facility Lease upon expiration of the Basic Lease Term, which notice is irrevocable as to the Lessee as provided in Section 13(a) of the Facility Lease;

(y) the Maximum Option Period is the period ending midnight on December 31, 2033; and

(z) the Fixed Rate Renewal Term is the period commencing on January 1, 2016, and ending midnight on December 31, 2033.

The Lessee and the Lessor hereby amend the Facility Lease effective as of the end of the Basic Lease Term in order to implement the foregoing as follows:

(a) Section 3(a)(iii) of the Facility Lease shall be amended and restated in its entirety as follows:

“(iii) on June 30, 2016 and on each Basic Rent Payment date thereafter to and including December 30, 2033, an amount equal to $4,671,699.81.”

(b) Section 12(a) of the Facility Lease (captioned “Fixed Rate Renewal Term”) shall be amended and restated in its entirety as follows:

”Lessee has irrevocably elected to exercise its rights to renew this Facility Lease for the period commencing on January 1, 2016, and ending midnight on December 31, 2033 (the “Fixed Rate Renewal Term”). Such renewal shall only take effect provided that, on January 1, 2016, (i) no Default or Event of Default shall have occurred and be continuing hereunder, (ii) no Event of Loss or Deemed Loss Event shall have occurred and (iii) all Notes shall have been paid in full.”

(c) The definition of Maximum Option Period in Appendix A to the Facility Lease shall be amended and restated in its entirety as follows:

Maximum Option Period shall mean the period ending midnight on December 31, 2033.”

(d) The definition of Casualty Value in Appendix A to the Facility Lease shall be amended and restated in its entirety as follows:

”Casualty Value, as of any date, shall mean:

(i) during the Basic Lease Term, the percentage of Facility Cost set forth opposite such date in Schedule 2 to the Facility Lease;

(ii) during the Fixed Rate Renewal Term, the amount in dollars set forth opposite such date in Schedule 4-Fixed Rate Renewal Term Casualty/Special Casualty Values to the Facility Lease, attached hereto; and

(iii) during the Fair Market Renewal Term, the amount equal to:

(A) the present value (declining in semi-annual steps over such Renewal Term and discounted at a rate of 10%) of the remaining Basic Rent payable from time to time in respect of the Undivided Interest for such Renewal Term plus

(B) the present value of the anticipated Fair Market Sales Value of the Undivided Interest as of the last day of such Renewal Term (increasing in semi-annual steps over such Renewal Term and discounted at a rate of 10%)

all as set forth in a schedule to be prepared prior to the commencement of such Renewal Term.”

(e) The definition of Special Casualty Value in Appendix A to the Facility Lease shall be amended and restated in its entirety as follows:

”Special Casualty Value, as of any date, shall mean:

(i) during the Basic Lease Term, the percentage of Facility Cost set forth opposite such date in Schedule 3 to the Facility Lease;

(iii) during the Fair Market Renewal Term, the amount equal to:

all as set forth in a schedule to be prepared prior to the commencement of such Renewal Term.”

(f) The Facility Lease shall be supplemented and amended to include as Schedule 4 thereto Schedule 4 attached hereto and designated as such (there being no Schedule 1, 2 or 3 to this Amendment).

SECTION 2. Miscellaneous.

(a) Effective Date of Amendments. The amendments set forth in Section 1 hereof shall be and become effective upon the satisfaction and discharge of the Indenture by the parties thereto.

(b) Counterpart Execution; Original Counterpart.

This Amendment 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 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 the law of the State of Arizona is mandatorily applicable hereto.

(d) Concerning USBNA. U.S. Bank National Association (“USBNA”) is entering into this Amendment solely as successor Owner Trustee under the Trust Agreement and not in its individual capacity. Anything herein or in the Facility Lease to the contrary notwithstanding, all and each of the representations, warranties, undertakings and agreements herein or in the Facility Lease 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 USBNA personally but are made and intended for the purpose of binding only the Trust Estate. This Amendment 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 USBNA or any successor in trust or the Equity Participant on account of any representation, warranty, undertaking or agreement hereunder or under the Facility Lease 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 or under the Facility Lease, may look to the Trust Estate for satisfaction of the same and the Owner Trustee or its successor in trust, as applicable, shall be personally liable for its own gross negligence or willful misconduct. If a further 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 and under the Facility Lease.

(e) Disclosure. Pursuant to Arizona Revised Statutes Section 33-404:

(i) the beneficiary of the Trust Agreement is Emerson Finance LLC (formerly Emerson Finance Co.); the address of the beneficiary is Emerson Finance LLC, 8000 West Florissant Avenue, St. Louis, Missouri 63136, Attention of President; and.

(ii) copy of the Trust Agreement is available for inspection at the offices of the Owner Trustee at U.S. Bank National Association, Corporate Trust Services, One Federal Street, 10th Floor, Boston, MA 02110, Attn: David J. Ganss.

IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment No. 4 to Facility Lease to be duly executed by an officer thereunto duly authorized.

[The balance of this page has intentionally been left blank.]

Signature page for Amendment No. 4 to Facility Lease (Lessor)



	U.S. BANK NATIONAL ASSOCIATION (successor to State Street Bank and Trust Company, successor to The First National Bank of Boston), not in its individual capacity, but solely as Owner Trustee under a Trust Agreement dated as of August 1, 1986, with Emerson Finance LLC (formerly Emerson Finance Co.)

	By: /s/ *David J. Ganss*
	Name: David J. Ganss
	Title: Vice President

ACKNOWLEDGMENT



COMMONWEALTH OF MASSACHUSETTS	)
	) ss.
COUNTY OF SUFFOLK	)

On this 30^th day of September, 2015, before me, the undersigned notary public, personally appeared David J. Ganss as Vice President of U.S. Bank National Association, proved to me through satisfactory evidence of identification, which was Massachusetts Driver’s License to be the person whose name is signed on the attached document and acknowledged to me that he signed it voluntarily for its stated purpose.



	Notary Public /s/ *Suk Ling Ng*

Name of Notary: Suk Ling Ng	Notary Public
My Comm. Expires 8-20-2021	Commonwealth of Massachusetts

Signature page for Amendment No. 4 to Facility Lease (Lessee)




	ARIZONA PUBLIC SERVICE COMPANY

	By: /s/ *Lee R. Nickloy*
	Name: Lee R. Nickloy
	Title: Vice President and Treasurer

ACKNOWLEDGMENT



STATE OF ARIZONA	)
	) ss.
COUNTY OF MARACOPA	)

This instrument was acknowledged before me this 30^th day of September, 2015, by Lee R. Nickloy, Vice president and Treasurer, of ARIZONA PUBLIC SERVICE COMPANY, an Arizona corporation, on behalf of said corporation.



	/s/ *Charisse Jicha*
	Name: Charisse Jicha
	Notary Public
	My Commission Expires: December 22, 2017

SCHEDULE 4-Fixed Rate Renewal Term Casualty/Special Casualty Values (EMERSON)



Rent Payment Date	Amount in Dollars ($)	Rent Payment Date	Amount in Dollars ($)
6/30/2016	124,958,699.35	6/30/2025	169,301,953.14
12/30/2016	126,534,934.51	12/30/2025	173,095,350.98
6/30/2017	128,189,981.42	6/30/2026	177,078,418.72
12/30/2017	129,927,780.68	12/30/2026	181,260,639.85
6/30/2018	131,752,469.91	6/30/2027	185,651,972.03
12/30/2018	133,668,393.59	12/30/2027	190,262,870.82
6/30/2019	135,680,113.46	6/30/2028	195,104,314.55
12/30/2019	137,792,419.33	12/30/2028	200,187,830.47
6/30/2020	140,010,340.48	6/30/2029	205,525,522.18
12/30/2020	142,339,157.70	12/30/2029	211,130,098.48
6/30/2021	144,784,415.77	6/30/2030	217,014,903.60
12/30/2021	147,351,936.75	12/30/2030	223,193,948.97
6/30/2022	150,047,833.78	6/30/2031	229,681,946.60
12/30/2022	152,878,525.66	12/30/2031	236,494,344.12
6/30/2023	155,850,752.13	6/30/2032	243,647,361.52
12/30/2023	158,971,589.92	12/30/2032	251,158,029.79
6/30/2024	162,248,469.61	6/30/2033	259,044,231.47
12/30/2024	165,689,193.28	12/30/2033	267,324,743.23

Dates Referenced Herein and Documents Incorporated by Reference

This ‘10-Q’ Filing	Date	Other Filings

	12/31/33
	12/30/33
	12/22/17
	6/30/16	10-Q
	1/1/16
Filed on:	10/30/15	8-K
For Period end:	9/30/15
	3/22/93
		List all Filings

4 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/27/24  Pinnacle West Capital Corp.       10-K       12/31/23  147:25M
 2/27/23  Pinnacle West Capital Corp.       10-K       12/31/22  146:28M
 2/25/22  Pinnacle West Capital Corp.       10-K       12/31/21  150:28M
 2/24/21  Pinnacle West Capital Corp.       10-K       12/31/20  144:26M

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Filing Submission 0000764622-15-000069 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)