Document/Exhibit Description Pages Size
1: 10-Q Quarterly Report for the Qtr Ended 3/31/2003 70 293K
2: EX-10.1 Employment Agreement - Levine 1 7K
3: EX-10.2 3rd Supplemental Indenture Dtd 11/1/02 19 82K
4: EX-10.3 3rd Amend. to Investment Co. Deferred Comp Plan 2 10K
5: EX-12.1 Ratio of Earnings to Fixed Charges 1 7K
6: EX-99.1 William J. Post Section 906 Certification 1 6K
7: EX-99.2 Donald E. Brandt Section 906 Certification 1 6K
8: EX-99.3 Acc Decision No. 65796 Dtd 4/4/03 48 172K
9: EX-99.5 Pinnacle West Risk Factors 6 35K
Exhibit 10.2
ARIZONA PUBLIC SERVICE COMPANY
TO
THE BANK OF NEW YORK
TRUSTEE
Third Supplemental Indenture
Dated as of November 1, 2002
To
Indenture
Dated as of November 15, 1996
5.05% Senior Notes (Maricopa 2002 Series A) Due 2029
THIRD SUPPLEMENTAL INDENTURE, dated as of November 1, 2002, between Arizona
Public Service Company, a corporation duly organized and existing under the laws
of the State of Arizona (herein called the "Company"), having its principal
office at 400 North Fifth Street, Phoenix, Arizona 85004, and The Bank of New
York, a New York banking corporation, as Trustee (herein called the "Trustee")
under the Indenture dated as of November 15, 1996 between the Company and the
Trustee (the "Indenture").
RECITALS OF THE COMPANY
The Company has executed and delivered the Indenture to the Trustee to
provide for the issuance from time to time of its Senior Notes (the "Notes"),
said Notes to be issued in one or more series as in the Indenture provided.
The Company has executed and delivered to the Trustee two indentures
supplemental to the Indenture, the First Supplemental Indenture dated as of
November 15, 1996, and the Second Supplemental Indenture dated as of April 1,
1997 (collectively, the "Supplemental Indentures").
Pursuant to the terms of the Indenture, the Company desires to provide for
the establishment of a new series of its Notes to be known as its 5.05% Senior
Notes (Maricopa 2002 Series A) Due 2029 (herein called the "Series A Senior
Notes"), the form and substance of such Series A Senior Notes and the terms,
provisions, and conditions thereof to be set forth as provided in the Indenture
and this Third Supplemental Indenture.
The Company has entered into a Loan Agreement, dated as of November 1, 2002
(as amended from time to time, the "Loan Agreement") between the Company and
Maricopa County, Arizona Pollution Control Corporation (the "Issuer"), and the
Issuer has issued the Maricopa County, Arizona Pollution Control Corporation
Pollution Control Revenue Refunding Bonds (Arizona Public Service Company Palo
Verde Project) 2002 Series A in the aggregate principal amount of $90,000,000
(the "Series A Pollution Control Bonds") under that certain Indenture of Trust,
dated as of November 1, 2002 (as amended from time to time, the "Maricopa
Indenture") between the Issuer and The Bank of New York, as Trustee (together
with its successors in such capacity, the "Maricopa Trustee") and loaned the
proceeds thereof to the Company (the "Loan") to pay a portion of the costs of
refunding through redemption of $45,000,000 aggregate principal amount of the
Maricopa County, Arizona Pollution Control Corporation Pollution Control Revenue
Refunding Bonds (Arizona Public Service Company Palo Verde Project) 1994 Series
A and $45,000,000 aggregate principal amount of the Maricopa County, Arizona
Pollution Control Corporation Pollution Control Revenue Refunding Bonds (Arizona
Public Service Company Palo Verde Project) 1994 Series B.
All things necessary to make this Third Supplemental Indenture a valid
agreement of the Company, and to make the Series A Senior Notes, when executed
by the Company and authenticated and delivered by the Trustee, the valid
obligations of the Company, have been done.
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Series A
Senior Notes by the Holders thereof, and for the purpose of setting forth, as
provided in the Indenture, the form and substance of the Series A Senior Notes
and the terms, provisions, and conditions thereof, it is mutually agreed, for
the equal and proportionate benefit of all Holders of the Series A Senior Notes,
as follows:
ARTICLE ONE
GENERAL TERMS AND CONDITIONS OF
THE SERIES A SENIOR NOTES
SECTION 101. There shall be and is hereby authorized a series of Notes
designated the "5.05% Senior Notes (Maricopa 2002 Series A) Due 2029," limited
in aggregate principal amount to $90,000,000, which amount shall be as set forth
in any Company Order for the authentication and delivery of Series A Senior
Notes. The Series A Senior Notes shall mature and the principal shall be due and
payable together with all accrued and unpaid interest thereon (subject to the
provisions for prior redemption hereinafter set forth) on May 1, 2029, shall be
issued in certificated form, in the form of a single fully registered Series A
Senior Note without coupons, and shall be registered in the name of the Maricopa
Trustee.
SECTION 102. Subject to the provisions herein, the Series A Senior Notes
shall bear interest from November 1, 2002 or from the most recent Interest
Payment Date (as defined below) to which interest has been paid at the rate of
5.05% per annum (calculated on the basis of a 360-day year of twelve 30-day
months), payable on May 1 and November 1 of each year (each an "Interest Payment
Date"), commencing May 1, 2003, to the holders thereof of record on the April 15
or October 15, as the case may be, next preceding such Interest Payment Date.
Notwithstanding the above, to the extent required in Section 4.2 of the
Loan Agreement at any time, all payments of interest on each Interest Payment
Date and of principal on the maturity date of the Series A Senior Notes shall be
due and payable not less than two (2) Business Days (as defined in the Maricopa
Indenture) prior to each such Interest Payment Date and such maturity date.
SECTION 103. The principal of and interest on the Series A Senior Notes
shall be payable by the Company to the Maricopa Trustee as pledgee and assignee
of the Issuer, at the designated office of the Maricopa Trustee, which shall
initially be in the City of New York, in such coin or currency of the United
States of America as, at the respective times of payment, is legal tender for
payment of public and private debts.
SECTION 104. The Company shall have no obligation to make payments with
respect to the principal and/or interest on the Series A Senior Notes unless and
until, and only to the extent that, payments shall be due and payable pursuant
to the Series A Pollution Control Bonds. Any provision hereof to the contrary
notwithstanding, the Company shall receive a credit against its obligation to
make any payment of interest on the Series A Senior Notes in an amount equal to
the amount, if any, held by the Maricopa Trustee under the Maricopa Indenture on
deposit in the Bond Fund (as defined in the Maricopa Indenture) and available to
make the corresponding payment on the Series A Pollution Control Bonds. In
addition, the Company shall receive a credit against its obligation to make any
payment of principal of the Series A Senior Notes, whether at maturity, upon
redemption or otherwise, in an amount equal to the amount, if any, held by the
2
trustee under the Maricopa Indenture on deposit in said Bond Fund and available
to make the corresponding payment on the Series A Pollution Control Bonds.
SECTION 105. In the manner and with the effect provided in Article 12 of
the Indenture, the Series A Senior Notes will be subject to redemption prior to
maturity, as follows:
(a) Series A Senior Notes are subject to redemption prior to maturity in
whole or in part, by lot, at any time at a redemption price equal to the
principal amount thereof plus accrued interest to the redemption date, in the
event of the exercise by the Company of its rights to prepay the Loan in full or
in part in accordance with Section 7.2 of the Loan Agreement upon the occurrence
of any of certain extraordinary events specified in Section 4.01(a)(1) of the
Maricopa Indenture.
(b) Series A Senior Notes are subject to redemption prior to maturity in
whole or in part, by lot, on any date on or after November 1, 2012, in the event
of the exercise by the Company of its rights to prepay the Loan in full or in
part in accordance with Section 7.2 of the Loan Agreement and Section 4.01(a)(2)
of the Maricopa Indenture at 100% of the principal amount of Series A Senior
Notes to be redeemed, together with accrued interest to the date fixed for
redemption
(c) Series A Senior Notes shall also be redeemable, in whole at any time,
prior to maturity by the application of cash delivered to or deposited with the
Trustee in the event of the exercise by the Company of its rights to prepay the
Loan in full in accordance with Section 7.2 of the Loan Agreement and Section
4.01(a)(3) of the Maricopa Indenture, pursuant to the provisions of Section 87
of the First Mortgage (but only if and to the extent such Section is properly
applicable to bona fide transactions), at the principal amount of the Series A
Senior Notes to be redeemed together with accrued interest to the date fixed for
redemption.
(d) Series A Senior Notes are subject to mandatory redemption prior to
maturity in whole or in part, by lot, at a redemption price equal to the
principal amount thereof plus accrued interest to the redemption date upon the
mandatory prepayment of the Loan in full or in part in accordance with Section
7.3 of the Loan Agreement upon the occurrence of any of certain extraordinary
events specified in Section 4.01(b) of the Maricopa Indenture.
Any notice given under the provisions of Section 4.03 of the Maricopa
Indenture with respect to redemption of all or a part of the Series A Pollution
Control Bonds or Section 7.5 of the Loan Agreement with respect to the
prepayment of all or a part of the Loan will also constitute sufficient notice
of the redemption of an amount of the Series A Senior Notes corresponding to the
amount of the Series A Pollution Control Bonds to be redeemed.
SECTION 106. In all cases that Series A Senior Notes are redeemed pursuant
to the provisions set forth above, the principal amount of Series A Senior Notes
to be redeemed shall equal the principal amount of Series A Pollution Control
Bonds concurrently redeemed and all applicable provisions of the Maricopa
Indenture and the Loan Agreement shall be satisfied.
SECTION 107. The cancellation by the Maricopa Trustee under the Maricopa
Indenture of Series A Pollution Control Bonds purchased by the Company or of
Series A Pollution Control Bonds redeemed or purchased by the Issuer, with funds
3
other than payments on Series A Senior Notes, shall constitute payment of an
amount of the Series A Senior Notes held by the Maricopa Trustee equal to the
aggregate principal amount of the Series A Pollution Control Bonds so purchased
or redeemed and cancelled. The Maricopa Trustee is required pursuant to Section
4.05 of the Maricopa Indenture to notify the Trustee of any such cancellation,
and, notwithstanding the provisions of Section 1207 of the Indenture, the
Maricopa Trustee under the Maricopa Indenture shall promptly make notation on
the Series A Senior Notes held by it of such reduction of the principal amount
thereof.
SECTION 108. Upon payment of the principal of and interest due on the
Series A Pollution Control Bonds, whether at maturity or prior to maturity by
redemption or otherwise, or upon provision for the payment thereof having been
made in accordance with Article X of the Maricopa Indenture, Series A Senior
Notes in a principal amount equal to the principal amount of Series A Pollution
Control Bonds so paid or for which such provision for payment has been made
shall be deemed fully paid, satisfied and discharged and the obligations of the
Company thereunder shall be terminated and such Series A Senior Notes shall be
surrendered to and cancelled by the Trustee.
SECTION 109. All payments by the Company on the Series A Senior Notes shall
be made at or prior to the opening of business on the due date thereof. If the
date for making any payment on the Loan provided in the Loan Agreement is a date
other than the due date for a payment of principal or interest on the Series A
Pollution Control Bonds, as described in Section 4.2 of the Loan Agreement, the
"due date" hereunder will be the date payment on the Loan is due under said
Section 4.2.
SECTION 110. No Series A Senior Notes shall be issued except to evidence,
secure and provide for the repayment of the Loan and interest thereon.
SECTION 111. Series A Senior Notes shall be nonnegotiable and will be
nontransferable except as required to effect assignment to the Maricopa Trustee
under the Maricopa Indenture and to any successor trustee thereunder. Upon the
appointment of a successor trustee under the Maricopa Indenture, the Trustee
shall authenticate and the Company shall issue in the name of said successor
trustee a new fully registered Series A Senior Note in the amount of the unpaid
principal amount of the Series A Senior Notes then outstanding, and the Series A
Senior Notes held by the Maricopa Trustee who has resigned or been discharged
shall be surrendered to, and cancelled by, the Trustee.
The Maricopa Trustee, as the holder of the Series A Senior Notes, shall
attend meetings of bondholders under the Senior Note Indenture or deliver its
proxy in connection therewith. Either at such meeting, or otherwise when the
consent of the holders of the Company's senior notes issued under the Senior
Note Indenture is sought without a meeting, the Maricopa Trustee shall vote as
the holder of the Series A Senior Notes, or shall consent with respect thereto;
PROVIDED, HOWEVER, that the Maricopa Trustee shall not vote in favor of, or
consent to, any modification of the Senior Note Indenture which is correlative
to a modification of the Maricopa Indenture or the Loan Agreement which would
require the approval of owners of Series A Pollution Control Bonds without the
4
approval of the owners of Series A Pollution Control Bonds which would be
required for such correlative modification of such Maricopa Indenture or Loan
Agreement.
SECTION 112. Series A Senior Notes acquired by the Company and submitted to
the Trustee for cancellation, or redeemed, or paid at maturity by the Company
shall forthwith be cancelled by the Trustee.
SECTION 113. The related series of Senior Note First Mortgage Bonds for the
Series A Senior Notes is the Company's First Mortgage Bonds, Senior Notes Series
C (the "Senior Note Series C Bonds").
SECTION 114. When the obligation of the Company to make payments with
respect to the principal of and interest on all or any part of the Senior Note
Series C Bonds shall be satisfied or deemed satisfied pursuant to Section 403 or
Section 501 of the Indenture or pursuant to Section 105 of this Third
Supplemental Indenture, the Trustee shall, upon written request of the Company
and, if applicable, the receipt of the certificate of the Expert described in
Section 404(b) of the Indenture (if such certificate is then required by Section
404(b) of the Indenture), deliver to the Company without charge therefor all of
the Senior Note Series C Bonds so satisfied or deemed satisfied, together with
such appropriate instruments of transfer or release as may be reasonably
requested by the Company. All Senior Note Series C Bonds delivered to the
Company in accordance with this Section 114 shall be delivered by the Company to
the First Mortgage Trustee for cancellation.
ARTICLE TWO
ADDITIONAL COVENANTS
SECTION 201. (a) From and after the Release Date and so long as any Series
A Senior Note is Outstanding, the Company will not issue, assume, or guarantee
any Debt secured by any mortgage, security interest, pledge, or lien (herein
referred to as a "mortgage") of or upon any Operating Property of the Company,
whether owned at the date of the Indenture or thereafter acquired, and will not
permit to exist any Debt secured by a mortgage on any Operating Property created
on or prior to the Release Date, without in any such case effectively securing,
on the later to occur of the issuance, assumption, or guarantee of any such Debt
or the Release Date, the Outstanding Series A Senior Notes (together with, if
the Company shall so determine, any other Note or Debt of or guaranteed by the
Company ranking senior to, or equally with, the Notes) equally and ratably with
such Debt; provided, however, that the foregoing restriction shall not apply to
Debt secured by any of the following:
(1) mortgages on any property existing at the time of acquisition thereof;
(2) mortgages on property of a corporation existing at the time such
corporation is merged into or consolidated with the Company, or at the
time of a sale, lease, or other disposition of the properties of such
corporation or a division thereof as an entirety or substantially as
5
an entirety to the Company, provided that such mortgage as a result of
such merger, consolidation, sale, lease, or other disposition is not
extended to property owned by the Company immediately prior thereto;
(3) mortgages on property to secure all or part of the cost of acquiring,
constructing, developing, or substantially repairing, altering, or
improving such property, or to secure indebtedness incurred to provide
funds for any such purpose or for reimbursement of funds previously
expended for any such purpose, provided such mortgages are created or
assumed contemporaneously with, or within eighteen (18) months after,
such acquisition or completion of construction, development, or
substantial repair, alteration, or improvement or within six (6)
months thereafter pursuant to a commitment for financing arranged with
a lender or investor within such eighteen (18) month period;
(4) mortgages in favor of the United States of America or any State
thereof, or any department, agency, or instrumentality or political
subdivision of the United States of America or any State thereof, or
for the benefit of holders of securities issued by any such entity, to
secure any Debt incurred for the purpose of financing all or any part
of the purchase price or the cost of constructing, developing, or
substantially repairing, altering, or improving the property subject
to such mortgages; or
(5) any extension, renewal or replacement (or successive extensions,
renewals, or replacements), in whole or in part, of any mortgage
referred to in the foregoing clauses (1) to (4), inclusive; provided,
however, that the principal amount of Debt secured thereby and not
otherwise authorized by said clauses (1) to (4), inclusive, shall not
exceed the principal amount of Debt, plus any premium or fee payable
in connection with any such extension, renewal, or replacement, so
secured at the time of such extension, renewal, or replacement.
(b) Notwithstanding the provisions of Section 201(a), from and after the
Release Date and so long as any Series A Senior Note is Outstanding, the Company
may issue, assume, or guarantee Debt, or permit to exist Debt, secured by
mortgages which would otherwise be subject to the restrictions of Section 201(a)
up to an aggregate principal amount that, together with the principal amount of
all other Debt of the Company secured by mortgages (other than mortgages
permitted by Section 201(a) that would otherwise be subject to the foregoing
restrictions) and the Value of all Sale and Lease-Back Transactions in existence
at such time (other than any Sale and Lease-Back Transaction that, if such Sale
and Lease-Back Transaction had been a mortgage, would have been permitted by
Section 201(a), other than Sale and Lease-Back Transactions permitted by Section
202 because the commitment by or on behalf of the purchaser was obtained no
later than eighteen (18) months after the later of events described in (i) or
6
(ii) of Section 202, and other than Sale and Lease-Back Transactions as to which
application of amounts have been made in accordance with clause (z) of Section
202), does not at the time exceed the greater of ten percent (10%) of Net
Tangible Assets or ten percent (10%) of Capitalization.
(c) If at any time the Company shall issue, assume, or guarantee any Debt
secured by any mortgage and if Section 201(a) requires that the Outstanding
Series A Senior Notes be secured equally and ratably with such Debt, the Company
will promptly execute, at its expense, any instruments necessary to so equally
and ratably secure the Outstanding Series A Senior Notes and deliver the same to
the Trustee along with:
(1) An Officers' Certificate stating that the covenant of the Company
contained in Section 201(a) has been complied with; and
(2) An Opinion of Counsel to the effect that the Company has complied with
the covenant contained in Section 201(a), and that any instrument
executed by the Company in the performance of such covenant complies
with the requirements of such covenant.
In the event that the Company shall hereafter secure Outstanding Series A
Senior Notes equally and ratably with any other obligation or indebtedness
(including other Notes) pursuant to the provisions of this Section 201, the
Trustee is hereby authorized to enter into an indenture or agreement
supplemental hereto and to take such action, if any, as it may, in its sole and
absolute discretion, deem advisable to enable it to enforce effectively the
rights of the Holders of Outstanding Series A Senior Notes so secured, equally
and ratably with such other obligation or indebtedness.
SECTION 202. From and after the Release Date and so long as any Series A
Senior Note is outstanding, the Company will not enter into any Sale and
Lease-Back Transaction with respect to any Operating Property and will not
permit to remain in effect any Sale and Lease-Back Transaction entered into on
or prior to the Release Date with respect to any Operating Property if, in any
case, the commitment by or on behalf of the purchaser is or was obtained more
than eighteen (18) months after the later of (i) the completion of the
acquisition, construction, or development of such Operating Property or (ii) the
placing in operation of such Operating Property or of such Operating Property as
constructed, developed, or substantially repaired, altered, or improved, unless
(x) the Company would be entitled pursuant to Section 201(a) to issue, assume,
or guarantee Debt secured by a mortgage on such Operating Property without
equally and ratably securing the Series A Senior Notes or (y) the Company would
be entitled pursuant to Section 201(b), after giving effect to such Sale and
Lease-Back Transaction, to incur $1.00 of additional Debt secured by mortgages
(other than mortgages permitted by Section 201(a)) or (z) the Company shall
apply or cause to be applied, in the case of a sale or transfer for cash, an
amount equal to the net proceeds thereof (but not in excess of the net book
value of such Operating Property at the date of such sale or transfer) and, in
the case of a sale or transfer otherwise than for cash, an amount equal to the
fair value (as determined by the Board of Directors) of the Operating Property
so leased, to the retirement, within one hundred eighty (180) days after the
7
later to occur of the effective date of such Sale and Lease-Back Transaction or
the Release Date, of Notes or other Debt of the Company ranking senior to, or
equally with, the Series A Senior Notes; PROVIDED, HOWEVER, that any such
retirement of Notes shall be in accordance with the terms and provisions of the
Indenture and the Notes; PROVIDED, FURTHER, that the amount to be applied to
such retirement of Notes or other Debt shall be reduced by an amount equal to
the sum of (a) an amount equal to the redemption price with respect to Notes
delivered within such one hundred eighty (180)-day period to the Trustee for
retirement and cancellation and (b) the principal amount, plus any premium or
fee paid in connection with any redemption in accordance with the terms of other
Debt voluntarily retired by the Company within such one hundred eighty (180)-day
period, excluding in each case retirements pursuant to mandatory sinking fund or
prepayment provisions and payments at maturity.
SECTION 203. DEFINITIONS
For purposes of Section 201 and Section 202 of this Third Supplemental
Indenture, the following terms shall have the following meanings:
"Capitalization" means the total of all the following items appearing on,
or included in, the consolidated balance sheet of the Company: (i) liabilities
for indebtedness maturing more than twelve (12) months from the date of
determination; and (ii) common stock, preferred stock, premium on capital stock,
capital surplus, capital in excess of par value, and retained earnings (however
the foregoing may be designated), less, to the extent not otherwise deducted,
the cost of shares of capital stock of the Company held in its treasury.
Subject to the foregoing, Capitalization shall be determined in accordance
with generally accepted accounting principles and practices applicable to the
type of business in which the Company is engaged and that are approved by
independent accountants regularly retained by the Company, and may be determined
as of a date not more than (sixty) 60 days prior to the happening of an event
for which such determination is being made.
The term "Debt" means any outstanding debt for money borrowed evidenced by
notes, debentures, bonds, or other securities.
The term "Net Tangible Assets" means the amount shown as total assets on
the consolidated balance sheet of the Company, less the following: (i)
intangible assets including, but without limitation, such items as goodwill,
trademarks, trade names, patents, and unamortized debt discount and expense and
other regulatory assets carried as an asset on the Company's consolidated
balance sheet; and (ii) appropriate adjustments, if any, on account of minority
interests.
Net Tangible Assets shall be determined in accordance with generally
accepted accounting principles and practices applicable to the type of business
in which the Company is engaged and that are approved by the independent
accountants regularly retained by the Company, and may be determined as of a
date not more than (sixty) 60 days prior to the happening of the event for which
such determination is being made.
8
The term "Operating Property" means (i) any interest in real property owned
by the Company and (ii) any asset owned by the Company that is depreciable in
accordance with generally accepted accounting principles.
The term "Sale and Lease-Back Transaction" means any arrangement with any
person providing for the leasing to the Company of any Operating Property
(except for temporary leases for a term, including any renewal thereof, of not
more than forty-eight (48) months), which Operating Property has been or is to
be sold or transferred by the Company to such person.
The term "Value" means, with respect to a Sale and Lease-Back Transaction,
as of any particular time, the amount equal to the greater of (1) the net
proceeds to the Company from the sale or transfer of the property leased
pursuant to such Sale and Lease-Back Transaction or (2) the net book value of
such property, as determined in accordance with generally accepted accounting
principles by the Company at the time of entering into such Sale and Lease-Back
Transaction, in either case multiplied by a fraction, the numerator of which
shall be equal to the number of full years of the term of the lease that is part
of such Sale and Lease-Back Transaction remaining at the time of determination
and the denominator of which shall be equal to the number of full years of such
term, without regard, in any case, to any renewal or extension options contained
in such lease.
SECTION 204. Amendment to Section 901 of the Indenture. For purposes of the
Series A Senior Notes, clause (1) of Section 901 of the Indenture, shall be
revised by deleting the words "For purposes of this Article Nine, the phrase
`assets substantially as an entirety' shall mean 50% or more of the total assets
of the Company as shown on the consolidated balance sheet of the Company as of
the end of the calendar year immediately preceding the day of the year in which
such determination is made and" replacing said words with the words
"Notwithstanding this Section 901."
ARTICLE THREE
FORM OF SERIES A SENIOR NOTE
SECTION 301. The Series A Senior Notes and the Trustee's certificate of
authentication to be endorsed are to be substantially in the following forms:
Form of Face of Note.
ARIZONA PUBLIC SERVICE COMPANY
5.05% Senior Notes (Maricopa 2002 Series A) Due 2029
No. 1 $90,000,000
Arizona Public Service Company, a corporation duly organized and existing
under the laws of Arizona (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
9
received, hereby promises to pay to The Bank of New York, as Trustee under the
Maricopa Indenture hereinafter referred to, as assignee of Maricopa County,
Arizona Pollution Control Corporation under said Maricopa Indenture, or it
successors in such capacity, the principal sum of Ninety Million Dollars on May
1, 2029, and to pay interest thereon from November 1, 2002 or from the most
recent Interest Payment Date with respect to which interest has been paid or
duly provided for, semi-annually on May 1 and November 1 in each year,
commencing May 1, 2003, at the rate of 5.05% per annum, until the principal
hereof is paid or made available for payment, from the dates such amounts are
due until they are paid or made available for payment. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Note (or
one or more Predecessor Notes) is registered at the close of business on the
Regular Record Date for such interest, which shall be the April 15 or October 15
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
Notwithstanding the above, to the extent required in Section 4.2 of the
Loan Agreement (described below) at any time, all payments of interest on each
Interest Payment Date and of principal on the maturity date of this Note shall
be due and payable not less than two (2) Business Days (as defined in the
Maricopa Indenture (described below)) prior to each such Interest Payment Date
and such maturity date.
Rights to payment of this Note have been assigned by Maricopa County,
Arizona Pollution Control Corporation (the "Issuer") to The Bank of New York, as
trustee (the "Maricopa Trustee") under the Indenture of Trust dated as of
November 1, 2002 (as amended and supplemented from time to time, herein called
the "Maricopa Indenture") between the Maricopa Trustee and the Issuer, to
evidence, secure and provide for the repayment of the loan (the "Loan") made by
the Issuer to the Company under the Loan Agreement dated as of November 1, 2002
(the Loan Agreement"), between the Company and the Issuer, from the proceeds of
the issuance by the Issuer of $90,000,000 of the Maricopa County, Arizona
Pollution Control Corporation Pollution Control Revenue Refunding Bonds (Arizona
Public Service Company Palo Verde Project) 2002 Series A (the "Pollution Control
Bonds") under the Maricopa Indenture, and such assignment has been duly
registered.
Payment of the principal of and interest on this Note will be paid by the
Company to the Maricopa Trustee at the designated office of the Maricopa
Trustee, or to any successor trustee under the Maricopa Indenture at its
designated office, in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts.
Reference is hereby made to the further provisions of this Note set forth
below, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
10
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
ARIZONA PUBLIC SERVICE COMPANY
By______________________________________
Attest:
______________________________________
Form of Reverse of Note.
This Note is one of a duly authorized issue of securities of the Company
(herein called the "Notes"), issued and to be issued in one or more series under
an Indenture, dated as of November 15, 1996, as supplemented and amended by the
First Supplemental Indenture thereto dated as of November 15, 1996 and the
Second Supplemental Indenture thereto dated as of April 1, 1997 (herein
collectively called the "Indenture"), between the Company and The Bank of New
York, as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), and reference is hereby made to the Indenture for
a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the Notes
and of the terms upon which the Notes are, and are to be, authenticated and
delivered. This Note is one of the series designated on the face hereof, limited
in aggregate principal amount to $90,000,000.
Prior to the Release Date (as hereinafter defined), this Note will be
secured by First Mortgage Bonds, Senior Note Series C (the "Senior Note Series C
Bonds") delivered by the Company to the Trustee for the benefit of the Holders
of the series of Notes of which this Note is a part, issued under the Mortgage
and Deed of Trust, dated as of July 1, 1946, from the Company to The Bank of New
York, as successor trustee (the "Mortgage Trustee"), as supplemented and amended
(the "First Mortgage"). Reference is made to the First Mortgage for a
description of property mortgaged and pledged, the nature and extent of the
security, the rights of the holders of the first mortgage bonds under the First
Mortgage and of the Mortgage Trustee in respect thereof, the duties and
immunities of the Mortgage Trustee and the terms and conditions upon which the
Senior Note Series C Bonds are secured and the circumstances under which
additional first mortgage bonds may be issued.
FROM AND AFTER SUCH TIME AS ALL FIRST MORTGAGE BONDS (OTHER THAN SENIOR
NOTE FIRST MORTGAGE BONDS, AS SUCH TERM IS DEFINED IN THE INDENTURE) HAVE BEEN
RETIRED THROUGH PAYMENT, REDEMPTION OR OTHERWISE AT, BEFORE OR AFTER THE
11
MATURITY THEREOF (THE "RELEASE DATE"), THE SENIOR NOTE FIRST MORTGAGE BONDS
SHALL CEASE TO SECURE THE NOTES IN ANY MANNER.
This Note is nonnegotiable and nontransferable except as required to effect
assignment to the Maricopa Trustee under the Maricopa Indenture and to any
successor trustee thereunder. Upon the appointment of a successor trustee under
the Maricopa Indenture, the Trustee shall authenticate and the Company shall
issue in the name of said successor trustee a new fully registered Note of this
series in the amount of the unpaid principal amount of this Note then
outstanding, and this Note shall be surrendered to, and canceled by, the
Trustee.
The Company shall have no obligation to make payments with respect to the
principal and/or interest on the Notes of this series unless and until, and only
to the extent that, payments shall be due and payable pursuant to the Pollution
Control Bonds. Any provision hereof to the contrary notwithstanding, the Company
shall receive a credit against its obligation to make any payment of interest on
the Notes of this Series in an amount equal to the amount, if any, held by the
Maricopa Trustee under the Maricopa Indenture on deposit in the Bond Fund (as
defined in the Maricopa Indenture) and available to make the corresponding
payment on the Pollution Control Bonds. In addition, the Company shall receive a
credit against its obligation to make any payment of principal of the Notes of
this Series, whether at maturity, upon redemption or otherwise, in an amount
equal to the amount, if any, held by the Maricopa Trustee under the Maricopa
Indenture on deposit in said Bond Fund and available to make the corresponding
payment on the Pollution Control Bonds.
In the manner and with the effect provided in Article 12 of the Indenture,
the Notes of this series will be subject to redemption prior to maturity, as
follows:
(a) The Notes of this Series are subject to redemption prior to maturity in
whole or in part, by lot, at any time at a redemption price equal to the
principal amount of the Notes of this Series to be redeemed plus accrued
interest to the redemption date in the event of the exercise by the Company of
its rights to prepay the Loan in full or in part in accordance with Section 7.2
of the Loan Agreement upon the occurrence of any of certain extraordinary events
specified in Section 4.01(a)(1) of the Maricopa Indenture.
(b) The Notes of this series are subject to redemption prior to maturity in
whole or in part, by lot, on any date on or after November 1, 2012, in the event
of the exercise by the Company of its rights to prepay the Loan in full or in
part in accordance with Section 7.2 of the Loan Agreement and Section 4.01(a)(2)
of the Maricopa Indenture at 100% of the principal amount of the Notes of this
series to be redeemed, together with accrued interest to the date fixed for
redemption
(c) The Notes of this series shall also be redeemable, in whole at any
time, prior to maturity by the application of cash delivered to or deposited
with the Trustee in the event of the exercise by the Company of its rights to
prepay the Loan in full in accordance with Section 7.2 of the Loan Agreement and
Section 4.01(a)(3) of the Maricopa Indenture, pursuant to the provisions of
Section 87 of the First Mortgage (but only if and to the extent such Section is
properly applicable to bona fide transactions), at 100% the principal amount of
the Notes of this series to be redeemed together with accrued interest to the
date fixed for redemption.
12
(d) The Notes of this series are subject to mandatory redemption prior to
maturity in whole or in part, by lot, at a redemption price equal to 100% of the
principal amount of the Notes of this series to be redeemed plus accrued
interest to the redemption date upon the mandatory prepayment of the Loan in
full or in part in accordance with Section 7.3 of the Loan Agreement upon the
occurrence of any of certain extraordinary events specified in Section 4.01(b)
of the Maricopa Indenture.
Any notice given under the provisions of Section 4.03 of the Maricopa
Indenture with respect to redemption of all or a part of the Pollution Control
Bonds or Section 7.5 of the Loan Agreement with respect to the prepayment of all
or a part of the Loan will also constitute sufficient notice of the redemption
of the principal amount of the Notes of this series corresponding to the amount
of the Pollution Control Bonds to be redeemed.
In the event of redemption of this Note in part only, a new Note or Notes
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
All payments by the Company on the Notes of this series shall be made at or
prior to the opening of business on the due date thereof. If the corresponding
date for making any payment provided in the Maricopa Indenture is to be
determined in accordance with the provisions of Section 11.11 thereof, the "due
date" hereunder will be determined in the same manner.
The Notes of this series will not be subject to any sinking fund.
If an Event of Default with respect to Notes of this series shall occur and
be continuing, the principal of the Notes of this series may be declared due and
payable in the manner and with the effect provided in the Indenture.
If an Event of Default with respect to Notes of this series shall occur and
be continuing, the principal of the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture and, upon such declaration,
the Trustee can demand the acceleration of the payment of principal of the
Senior Note Series C Bonds as provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of a majority in principal amount of the Notes at the time
Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
13
As provided in and subject to the provisions of the Indenture, the Holder
of this Note shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Notes of this series, the Holders of not less than 25% in principal amount of
the Notes of this series at the time Outstanding shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default as
Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not
have received from the Holders of a majority in principal amount of Notes of
this series at the time Outstanding a direction inconsistent with such request,
and shall have failed to institute any such proceeding, for 60 days after
receipt of such notice, request and offer of indemnity. The foregoing shall not
apply to any suit instituted by the Holder of this Note for the enforcement of
any payment of principal hereof or interest hereon on or after the respective
due dates expressed herein.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
Form of Trustee's Certificate of Authentication.
CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the series designated therein referred to in
the within-mentioned Indenture.
Dated:
THE BANK OF NEW YORK,
AS TRUSTEE
By______________________________
AUTHORIZED SIGNATORY
ARTICLE FOUR
ORIGINAL ISSUE OF SERIES A SENIOR NOTES
SECTION 401. Series A Senior Notes in the aggregate principal amount of
$90,000,000, may, upon execution of this Third Supplemental Indenture, or from
time to time thereafter, be executed by the Company and delivered to the Trustee
for authentication, and the Trustee shall thereupon authenticate and deliver
said Notes to or upon the written order of the Company, signed by its Chairman,
its President, or any Vice President and its Treasurer or an Assistant
Treasurer, without any further action by the Company.
14
ARTICLE FIVE
PAYING AGENT AND REGISTRAR
SECTION 501. The Bank of New York will be the Paying Agent and Note
Registrar for the Series A Senior Notes.
ARTICLE SIX
SUNDRY PROVISIONS
SECTION 601. Except as otherwise expressly provided in this Third
Supplemental Indenture or in the form of Series A Senior Notes or otherwise
clearly required by the context hereof or thereof, all terms used herein or in
said form of Series A Senior Notes that are defined in the Indenture shall have
the several meanings respectively assigned to them thereby.
SECTION 602. The Indenture, as supplemented by this Third Supplemental
Indenture, is in all respects ratified and confirmed, and this Third
Supplemental Indenture shall be deemed part of the Indenture in the manner and
to the extent herein and therein provided.
SECTION 603. The Trustee hereby accepts the trusts herein declared,
provided, created, supplemented, or amended and agrees to perform the same upon
the terms and conditions herein and in the Indenture, as heretofore supplemented
and amended, set forth and upon the following terms and conditions:
The Trustee shall not be responsible in any manner whatsoever for or in
respect of the validity or sufficiency of this Third Supplemental Indenture or
for or in respect of the recitals contained herein, all of which recitals are
made by the Company solely. In general, each and every term and condition
contained in Article Seven of the Indenture shall apply to and form part of this
Third Supplemental Indenture with the same force and effect as if the same were
herein set forth in full with such omissions, variations, and insertions, if
any, as may be appropriate to make the same conform to the provisions of this
Third Supplemental Indenture.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
15
IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
ARIZONA PUBLIC SERVICE COMPANY
By: Barbara M. Gomez
------------------------------------
Barbara M. Gomez
Treasurer
Attest:
Betsy A. Pregulman
-------------------------------------
Betsy A. Pregulman
Associate Secretary
THE BANK OF NEW YORK, as Trustee
By: Debra A. Schwalb
------------------------------------
Vice President
Attest:
Thomas J. Provenzano
-------------------------------------
Vice President
16
STATE OF ARIZONA )
) ss:
COUNTY OF MARICOPA )
On the 1st day of November, 2002, before me personally came Barbara M.
Gomez, to me known, who, being by me duly sworn, did depose and say that she is
the Treasurer of Arizona Public Service Company, one of the corporations
described in and which executed the foregoing instrument; that she knows the
seal of said corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of Directors of
said corporation; and that she signed her name thereto by like authority.
Debra L. Blondin
------------------------------------
NOTARY PUBLIC
My Commission Expires:
June 7, 2004
----------------------
17
STATE OF NEW JERSEY )
) ss:
COUNTY OF PASSAIC )
On the 1st day of November, 2002, before me personally came Debra A.
Schwalb, to me known, who, being by me duly sworn, did depose and say that she
is the Vice President of The Bank of New York, one of the corporations described
in and which executed the foregoing instrument; that she knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation; and that she signed her name thereto by like authority.
Ronald M. Mania
------------------------------------
NOTARY PUBLIC
My Commission Expires:
10-4-06
----------------------
18
Dates Referenced Herein and Documents Incorporated by Reference
4 Subsequent Filings that Reference this Filing
↑Top
Filing Submission 0000950147-03-000623 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
About — Privacy — Redactions — Help —
Sun., Apr. 28, 11:44:23.1am ET 
