EXHIBIT 4a
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AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT
(AMENDING AND RESTATING THE TWO INSTALLMENT SALE AGREEMENTS
DATED AS OF DECEMBER 1, 1973 AND NOVEMBER 1, 1977, RESPECTIVELY)
BETWEEN
CITY OF FARMINGTON, NEW MEXICO
VENDOR
AND
TUCSON ELECTRIC POWER COMPANY
VENDEE
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DATED AS OF APRIL 1, 1997
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RELATING TO
POLLUTION CONTROL REVENUE BONDS,
1997 SERIES A
(TUCSON ELECTRIC POWER COMPANY SAN XXXX PROJECT)
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TABLE OF CONTENTS
Page
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AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT . . . . . . . 1
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . 3
SECTION 1.02. Incorporation of Certain
Definitions by Reference . . . . . . . . . . 7
ARTICLE II
REPRESENTATIONS, WARRANTIES AND FINDINGS
SECTION 2.01. Representations and Warranties of the City. . 7
SECTION 2.02. Representations and Warranties of the Company 7
SECTION 2.03. Findings of the City. . . . . . . . . . . . . 8
ARTICLE III
PRIOR CONVEYANCE TO THE CITY; THE FACILITIES
SECTION 3.01. Prior Conveyance to the City. . . . . . . . . 8
SECTION 3.02. Revision of Plans and Specifications . . . . . 8
SECTION 3.03. Maintenance of Facilities; Remodeling; Notice of
Damages . . . . . . . . . . . . . . . . . . . 9
SECTION 3.04. Insurance . . . . . . . . . . . . . . . . . . 9
SECTION 3.05. Condemnation; Eminent Domain. . . . . . . . . 9
ARTICLE IV
ISSUANCE AND SALE OF THE BONDS;
DISPOSITION OF PROCEEDS OF THE BONDS
SECTION 4.01. Issuance of the Bonds . . . . . . . . . . . . 10
SECTION 4.02. Issuance of Other Obligations. . . . . . . . . 10
SECTION 4.03. Disposition of Bond Proceeds. . . . . . . . . 10
SECTION 4.04. Investment of Moneys in Funds and Accounts. . 10
ARTICLE V
PURCHASE BY THE COMPANY;
PURCHASE PRICE PAYMENTS; OTHER OBLIGATIONS
SECTION 5.01. Prior Purchase by the Company. . . . . . . . . 10
SECTION 5.02. Purchase Price Payments. . . . . . . . . . . . 11
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* This table of contents is not part of the Installment Sale
Agreement, and is for convenience only. The captions herein
are of no legal effect and do not vary the meaning or legal
effect of any part of the Installment Sale Agreement.
SECTION 5.03. Payments Pledged and Assigned; Obligation
Absolute . . . . . . . . . . . . . . . . . . 11
SECTION 5.04. Payment of Expenses . . . . . . . . . . . . . 11
SECTION 5.05. Indemnification . . . . . . . . . . . . . . . 11
SECTION 5.06. Payment of Taxes; Discharge of Liens . . . . . 12
ARTICLE VI
SPECIAL COVENANTS
SECTION 6.01. Maintenance of Corporate Existence . . . . . . 12
SECTION 6.02. Permits or Licenses . . . . . . . . . . . . . 13
SECTION 6.03. City's Access to Facilities. . . . . . . . . . 13
SECTION 6.04. Tax-Exempt Status of Interest on Bonds. . . . 13
SECTION 6.05. Use of Facilities . . . . . . . . . . . . . . 14
SECTION 6.06. Financing Statements . . . . . . . . . . . . . 14
SECTION 6.07. No Warranties. . . . . . . . . . . . . . . . . 14
SECTION 6.08. Quiet Enjoyment. . . . . . . . . . . . . . . . 14
SECTION 6.09. Additional Payments by Company Concerning the
Facilities. . . . . . . . . . . . . . . . . . 15
SECTION 6.10 Qualification in New Mexico . . . . . . . . . 15
ARTICLE VII
ASSIGNMENT, LEASING AND SELLING
SECTION 7.01. By the City. . . . . . . . . . . . . . . . . . 15
SECTION 7.02. By the Company . . . . . . . . . . . . . . . . 15
SECTION 7.03. Instrument Furnished to the City and Trustee . 17
SECTION 7.04. Limitation . . . . . . . . . . . . . . . . . . 17
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
SECTION 8.01. Events of Default . . . . . . . . . . . . . . 17
SECTION 8.02. Force Majeure . . . . . . . . . . . . . . . . 17
SECTION 8.03. Remedies . . . . . . . . . . . . . . . . . . . 18
SECTION 8.04. No Remedy Exclusive . . . . . . . . . . . . . 18
SECTION 8.05. Reimbursement of Attorneys' and Agents' Fees . 18
SECTION 8.06. Waiver of Breach . . . . . . . . . . . . . . . 18
ARTICLE IX
PREPAYMENT OF PURCHASE PRICE PAYMENTS;
REDEMPTION OF BONDS
SECTION 9.01. Prepayment of Purchase Price Payments; Redemption
of Bonds . . . . . . . . . . . . . . . . . . 19
SECTION 9.02. Compliance with the Ordinance . . . . . . . . 19
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Term of Agreement . . . . . . . . . . . . . . 19
SECTION 10.02. Effect of Plant Agreements . . . . . . . . . 19
SECTION 10.03. Notices . . . . . . . . . . . . . . . . . . . 19
SECTION 10.04. Parties in Interest . . . . . . . . . . . . . 20
SECTION 10.05. Amendments . . . . . . . . . . . . . . . . . 20
SECTION 10.06. Counterparts . . . . . . . . . . . . . . . . 20
SECTION 10.07. Severability . . . . . . . . . . . . . . . . 20
SECTION 10.08. Governing Law . . . . . . . . . . . . . . . . 20
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . 21
Exhibit A Description of Facilities . . . . . . . . . . . . . A-1
AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT
THIS AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT, dated
as of April 1, 1997 (this "Agreement"), between the CITY OF
FARMINGTON, in the County of San Xxxx, an incorporated
municipality, a body politic and corporate, existing under the
Constitution and laws of the State of New Mexico (hereinafter
called the "City"), as Vendor, and TUCSON ELECTRIC POWER COMPANY,
a corporation organized and existing under the laws of the State
of Arizona, formerly known as Tucson Gas & Electric Company
(hereinafter called the "Company"), as Vendee, being an amendment
to and a restatement in its entirety of those certain Installment
Sale Agreements, dated as of December 1, 1973 (the "Series 1973
Installment Sale Agreement") and November 1, 1977 (the "Series
1977 Installment Sale Agreement"), each between the City, as
Vendor, and the Company, as Vendee (it being understood that
Public Service Company of New Mexico was, but no longer is, an
additional Vendee under such Installment Sale Agreement dated as
of December 1, 1973).
W I T N E S S E T H :
WHEREAS, the City is authorized and empowered under the
Pollution Control Revenue Bond Act, Chapter 397, Laws of 1973 of
the State of New Mexico, 31st Legislature, 1st Session, as
amended (the "Act"), to issue revenue bonds for and to acquire,
whether by construction, purchase, gift or lease, one or more
projects consisting of any land, interest in land, building,
structure, facility, system, fixture, improvement, appurtenance,
machinery, equipment or any combination thereof, or any interest
in any one or more of the foregoing, whether or not presently in
existence or under construction, used by any individual,
partnership, firm, company, corporation (including a public
utility), association, trust, estate, political subdivision,
state agency or any other legal entity, or its legal
representative, agent or assigns, substantially for the
reduction, abatement or prevention of pollution, including, but
not limited to, the removal of pollutants, contaminants or
foreign substances from land, air or water, or for the removal or
treatment of any substance in a processed material which would
otherwise cause pollution when such material is used, provided
that any such project shall be located within the State of New
Mexico and within or without or partially within or without the
City, but not more than fifteen miles outside of the corporate
limits of the City (or that, if there is no municipality within
fifteen miles of the project, the City is in the county in which
the project is or may be located) and to sell or lease or
otherwise dispose of any or all of such projects upon such terms
and conditions as the governing body of the City (hereinafter
called the "City Council") may deem advisable and as shall not
conflict with the provisions of the Act; and
WHEREAS, the San Xxxx Generating Station, an electric power
generating plant, is located within fifteen miles of the
corporate limits of the City in San Xxxx County, New Mexico but
not within the corporate limits of any municipality; and
WHEREAS, on August 28, 1973, the City Council adopted
Resolution Number 709 ("Resolution No. 709") determining to issue
and, subject to certain conditions, agreeing to issue revenue
bonds under the Act to finance the costs to the Company of
certain facilities for the reduction, abatement or prevention of
pollution caused by the operation of the San Xxxx Generating
Station, including facilities for the reduction, abatement or
prevention of pollution caused by the operation of Units 1 and 2
of such generating station (the "Facilities") and authorizing the
Mayor of the City to execute and deliver preliminary agreements
relating thereto and, subject to certain conditions, to take such
steps and actions as required or necessary in order to issue such
revenue bonds, and a Preliminary Agreement (the "Original
Preliminary Agreement"), in the form contemplated by Resolution
No. 709, was executed and delivered by the City and the Company;
and
WHEREAS, on November 27, 1973, the City Council adopted
Resolution Number 721 ("Resolution No. 721") in order to
authorize consideration of the adoption of a proposed Ordinance,
in order to, among other matters, increase the aggregate
principal amount of revenue bonds authorized to be issued by the
City to finance the costs to the Company of the acquisition,
construction and installation of the Facilities; and
WHEREAS, on August 13, 1974, the City Council adopted
Resolution Number 751 ("Resolution No. 751") authorizing the
Mayor of the City to execute and deliver certain amendments to
the Original Preliminary Agreement in order to, among other
matters, further increase the aggregate principal amount of
revenue bonds authorized to be issued by the City to finance the
costs to the Company of the acquisition, construction and
installation of the Facilities; and
WHEREAS, a supplemental preliminary agreement (the
"Supplemental Preliminary Agreement," and, together with the
Original Preliminary Agreement and Resolution No. 721, the
"Preliminary Agreement"), in the form contemplated by Resolution
No. 751, was executed and delivered by the City and the Company
on August 13, 1974; and
WHEREAS, pursuant to Ordinance No. 486, adopted by the City
Council on December 17, 1973, as supplemented by Ordinance No.
487, adopted by the City Council on January 3, 1974 (together,
the "Series 1973 Ordinance"), the City has heretofore issued and
sold $55,000,000 aggregate principal amount of its Pollution
Control Revenue Bonds, Series 1973 (Tucson Gas & Electric Company
San Xxxx Project), of which $47,910,000 in principal amount
remains outstanding (the "1973 Bonds"), the proceeds of which
were to be used to finance a portion of the costs to the Company
of the acquisition, construction and installation of the
Facilities at Units 1 and 2 of the San Xxxx Generating Station
described in Exhibit A to the Series 1973 Installment Sale
Agreement; and
WHEREAS, Public Service Company of New Mexico has redeemed
the pollution control revenue bonds secured by revenues derived
pursuant to the Series 1973 Installment Sale Agreement and its
obligations and rights pursuant thereto have been discharged so
that the Company remains the sole Vendee thereunder; and
WHEREAS, pursuant to Ordinance No. 579, adopted by the City
Council on November 1, 1977, as supplemented by Ordinance No.
580, adopted by the City Council on November 8, 1977 (together,
the "Series 1977 Ordinance"), the City has also heretofore issued
and sold $32,500,000 aggregate principal amount of its
Collateralized Pollution Control Revenue Bonds, 1977 Series A
(Tucson Gas & Electric Company San Xxxx Project), of which
$32,500,000 in principal amount remains outstanding (the "1977
Bonds") (the 1973 Bonds and the 1977 Bonds being hereinafter
called, collectively, the "Prior Bonds"), the proceeds of which
were to be used to finance a portion of the costs to the Company
of the acquisition, construction and installation of the
Facilities at Units 1 and 2 of the San Xxxx Generating Station
described in Exhibit A to the Series 1977 Installment Agreement;
and
WHEREAS, in order to refinance the Facilities through the
refunding and redemption of the Prior Bonds, the City intends to
issue and sell its Pollution Control Revenue Bonds, 1997 Series A
(Tucson Electric Power Company San Xxxx Project) (the "Bonds")
pursuant to Ordinance No. 97-1055, adopted by the City Council on
April 17, 1997, and Resolution No. 97-879, adopted by the City
Council on April 17, 1997 (together, the "Ordinance"), for the
purpose of providing funds which, together with other funds
available therefor, will be sufficient to refund and redeem the
Prior Bonds; and
WHEREAS, in connection with the issuance of the Bonds, the
Company has requested that the Series 1973 Installment Sale
Agreement and the Series 1977 Installment Sale Agreement (each an
"Original Sale Agreement," and hereinafter collectively referred
to as the "Original Sale Agreements") be amended and restated;
NOW, THEREFORE, the parties hereto, intending to be legally
bound hereby and in consideration of the premises, DO HEREBY
AGREE as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms defined in this
Article I shall for all purposes of this Agreement have the
meanings herein specified, unless the context clearly requires
otherwise:
Act:
"Act" shall mean the Pollution Control Revenue Bond Act,
Chapter 397, Laws of 1973 of the State of New Mexico, 31st
Legislature, 1st Session, as amended by Chapter 312, Laws of 1977
of the State of New Mexico, 33rd Legislature, 1st Session, by
Chapter 181, Laws of 1978 of the State of New Mexico, 33rd
Legislature, 2nd Session, and by Chapter 114, Laws of 1983 of the
State of New Mexico, 36th Legislature, 1st Session, and all acts
supplemental thereto or amendatory thereof.
Administration Expenses:
"Administration Expenses" shall mean the reasonable expenses
incurred by the City with respect to this Agreement, the
Ordinance and any transaction or event contemplated by this
Agreement or the Ordinance, including the compensation and
reimbursement of expenses and advances payable to the Trustee, to
the paying agent, any co-paying agent and the registrar under the
Ordinance.
Agreement:
"Agreement" shall mean this Amended and Restated Installment
Sale Agreement, dated as of April 1, 1997, between the City and
the Company, and any and all modifications, alterations,
amendments and supplements hereto.
Authorized Company Representative:
"Authorized Company Representative" shall mean each person
at the time designated to act on behalf of the Company by written
certificate furnished to the City and the Trustee containing the
specimen signature of such person and signed on behalf of the
Company by its President, any Vice President or its Treasurer,
together with its Secretary or any Assistant Secretary.
Bond Counsel:
"Bond Counsel" shall mean any firm or firms of nationally
recognized bond counsel experienced in matters pertaining to the
validity of, and exclusion from gross income for federal tax
purposes of interest on bonds issued by states and political
subdivisions, selected by the Company and acceptable to the City.
Bond Fund:
"Bond Fund" shall mean the fund created by Section 4.01 of
the Ordinance.
Bonds:
"Bond" or "Bonds" shall mean the Pollution Control Revenue
Bonds, 1997 Series A (Tucson Electric Power Company San Xxxx
Project) of the City.
City:
"City" shall mean the City of Farmington, in the County of
San Xxxx, an incorporated municipality, a body politic and
corporate, existing under the Constitution and laws of the State
of New Mexico, and its successors and their assigns.
City Council:
"City Council" shall mean the City Council of the City or
the board or other body in which general legislative powers of
the City subsequently may be vested.
Code:
"Code" shall mean the Internal Revenue Code of 1986 or any
successor statute thereto. Each reference to a section of the
Code herein shall be deemed to include the United States Treasury
Regulations proposed or in effect thereunder and applicable to
the Bonds or the use of the proceeds thereof, unless the context
clearly requires otherwise. Reference to any particular Code
section shall, in the event of a successor Code, be deemed to be
a reference to the successor to such Code section.
Company:
"Company" shall mean Tucson Electric Power Company, a
corporation organized and existing under the laws of the State of
Arizona, its successors and their assigns, including, without
limitation, any successor obligor under Section 6.01 and 7.02 to
the extent of the obligations assumed thereunder.
Company Mortgages:
"Company Mortgages" shall mean the Indenture, dated as of
April 1, 1941, between The Tucson Gas, Electric Light and Power
Company (predecessor of the Company) and The Chase National Bank
of the City of New York (now The Chase Manhattan Bank), as
trustee, as heretofore and hereafter amended and supplemented and
the Indenture of Mortgage and Deed of Trust, dated as of December
1, 1992, between the Company and Bank of Montreal Trust Company,
as trustee, as heretofore and hereafter amended and supplemented.
Company Project:
"Company Project" shall mean the interests in the Facilities
previously sold by the City to the Company, pursuant to the
Original Sale Agreements.
Facilities:
"Facilities" shall mean the systems and facilities for the
reduction, abatement or prevention of pollution caused by the
operation of the Plant which are described in Exhibit A hereto,
as from time to time amended or modified, and related
improvements.
1954 Code:
"1954 Code" shall mean the Internal Revenue Code of 1954, as
amended.
1977 Bonds:
"1977 Bonds" shall mean the $32,500,000 aggregate principal
amount of the City's Collateralized Pollution Control Revenue
Bonds, 1977 Series A (Tucson Gas & Electric Company San Xxxx
Project), all of which remain outstanding.
1973 Bonds:
"1973 Bonds" shall mean the $55,000,000 aggregate principal
amount of the City's Pollution Control Revenue Bonds, Series 1973
(Tucson Gas & Electric Company San Xxxx Project), of which
$47,910,000 in principal amount remains outstanding.
Ordinance:
"Ordinance" shall mean Ordinance No. 97-1055 adopted by the
City Council on April 17, 1997 creating and securing the Bonds,
as modified, altered, amended or supplemented by any and all
ordinances and resolutions supplemental thereto or amendatory
thereof adopted by the City Council and effective prior to the
initial issuance of the Bonds, including without limitation,
Resolution No. 97-879 adopted by the City Council on April 17,
1997 and any Supplemental Ordinances and related resolutions
adopted thereafter by the City Council pursuant thereto.
Original Sale Agreements:
"Original Sale Agreements" shall mean the Series 1973
Installment Sale Agreement and the Series 1977 Installment Sale
Agreement.
Outstanding:
"Outstanding", when used in reference to the Bonds, shall
mean, as at any particular date, the aggregate of all Bonds
authenticated and delivered under the Ordinance except:
(a) those canceled by the Trustee at or prior to such
date or delivered to or acquired by the Trustee at or prior
to such date for cancellation;
(b) those deemed to be paid in accordance with Article
VIII of the Ordinance; and
(c) those in lieu of or in exchange or substitution
for which other Bonds shall have been authenticated and
delivered pursuant to the Ordinance, unless proof
satisfactory to the Trustee and the Company is presented
that such Bonds are held by a bona fide holder in due
course.
Permitted Encumbrances:
"Permitted Encumbrances" shall mean and include (a) liens
for taxes, assessments and other governmental charges not
delinquent or which can be paid without penalty; (b) unfiled,
inchoate mechanics' and materialmen's liens for construction work
in progress; (c) workmen's, repairmen's warehousemen's and
carriers' liens and other similar liens, if any, arising in the
ordinary course of business; (d) all the following, if they do
not individually or in the aggregate materially impair the use of
the Facilities or materially detract from the value thereof to
the Company, viz.: any easements, restrictions, mineral, oil, gas
and mining rights and reservations, zoning laws and defects in
title or other encumbrances to which the Facilities may be
subject because of the installation thereof at the Plant; (e) any
lien for the satisfaction and discharge of which a sum of money
or a surety bond deemed adequate by the Trustee is on deposit
with the Trustee; (f) the rights of the City and the Company
under this Agreement and any prior or subsequent installment sale
agreement or lease between the City and Company relating to all
or any part of the Facilities and the issuance of revenue bonds
in connection therewith; (g) the lien of the Company Mortgages
and liens, encumbrances and defects of the character of the
permitted encumbrances referred to therein; and (h) the Plant
Agreements.
Person:
"Person" means (i) any corporation, limited liability
company, partnership, joint venture, association, joint-stock
company, business trust or unincorporated organization, in each
case formed or organized under the laws of the United States of
America, any state thereof or the District of Columbia, or (ii)
the United States of America or any state thereof, or any
political subdivision of either thereof, or any agency, authority
or other instrumentality of any of the foregoing.
Plant:
"Plant" shall mean Units 1 and 2 and related common
facilities of the San Xxxx Generating Station, an electric power
generating plant located northwest of and within fifteen miles of
the corporate limits of the City in San Xxxx County, New Mexico,
and not within the corporate limits of any municipality, and any
additions or improvements thereto or replacements thereof.
Plant Agreements:
"Plant Agreements" shall mean all contracts relating to the
ownership, construction and operation of the Plant, including the
Facilities, as from time to time amended or supplemented.
Prior Bonds:
"Prior Bonds" shall mean the 1973 Bonds and the 1977 Bonds,
collectively.
Purchase Price Payments:
"Purchase Price Payments" shall mean the payments required
to be made by the Company pursuant to Section 5.02 hereof.
Series 1973 Installment Sale Agreement:
"Series 1973 Installment Sale Agreement" shall mean the
Installment Sale Agreement, dated as of December 1, 1973, between
the City, as Vendor, and Public Service Company of New Mexico
(which has now been discharged therefrom) and the Company, as
Vendees, as amended and supplemented pursuant to the terms
thereof prior to the date hereof.
Series 1977 Installment Sale Agreement:
"Series 1977 Installment Sale Agreement" shall mean the
Installment Sale Agreement, dated as of November 1, 1977, between
the City, as Vendor, and the Company, as Vendee, as amended and
supplemented pursuant to the terms thereof prior to the date
hereof.
Supplemental Ordinance:
"Supplemental Ordinance" shall mean any ordinance or
resolution adopted by the City Council and effective subsequent
to the initial issuance of the Bonds modifying, altering,
amending, supplementing or confirming the Ordinance or for any
purpose, in accordance with the terms of the Ordinance, as such
Supplemental Ordinance may be modified, altered, amended or
supplemented by any and all ordinances and related resolutions of
the City Council of the City adopted pursuant thereto.
Tax Agreement:
"Tax Agreement" shall mean that tax certificate and
agreement, dated the date of the initial authentication and
delivery of the Bonds, between the City and the Company, relating
to the requirements of the Code and the 1954 Code, and any and
all modifications, alterations, amendments and supplements
thereto.
Trustee:
"Trustee" shall mean First Trust of New York, National
Association, as trustee under the Ordinance, its successors in
trust and their assigns.
SECTION 1.02. Incorporation of Certain Definitions by
Reference. Each capitalized term used herein and not otherwise
defined herein shall have the meaning set forth in the Ordinance.
ARTICLE II
REPRESENTATIONS, WARRANTIES AND FINDINGS
SECTION 2.01. Representations and Warranties of the City.
The City makes the following representations and warranties as
the basis for the undertakings on the part of the Company
contained herein:
(a) The City is an incorporated municipality, a body
politic and corporate, existing under the Constitution and
laws of the State of New Mexico;
(b) The City has the power to enter into this
Agreement and to perform and observe the agreements and
covenants on its part contained herein, including without
limitation the power to issue and sell the Bonds as
contemplated herein and in the Ordinance, and by proper
corporate action has duly authorized the execution and
delivery hereof;
(c) The execution and delivery of this Agreement by
the City do not, and consummation of the transactions
contemplated hereby and fulfillment of the terms hereof by
the City will not, result in a breach of any of the terms or
provisions of, or constitute a default under, any ordinance,
indenture mortgage, deed of trust or other agreement or
instrument to which the City is now a party or by which it
is now bound, or any order, rule or regulation applicable to
the City of any court or of any regulatory body or
administrative agency or other governmental body having
jurisdiction over the City or over any of its properties, or
the Constitution or laws of the State of New Mexico;
SECTION 2.02. Representations and Warranties of the
Company. The Company makes the following representations and
warranties as the basis for the undertakings on the part of the
City contained herein:
(a) The Company is a corporation duly organized and
existing in good standing under the laws of the State of
Arizona and duly qualified as a foreign corporation in the
State of New Mexico;
(b) The Company has power to enter into this Agreement
and to perform and observe the agreements and covenants on
its part contained herein and by proper corporate action has
duly authorized the execution and delivery hereof;
(c) The execution and delivery of this Agreement by
the Company do not, and consummation of transactions
contemplated hereby and fulfillment of the terms hereof by
the Company will not, result in a breach of any of the terms
or provisions of, or constitute a default under, any
ordinance, indenture mortgage, deed of trust or other
agreement or instrument to which the Company is a party or
by which it is now bound, or the Restated Articles of
Incorporation or by-laws of the Company, or any order, rule
or regulation applicable to the Company of any court or of
any regulatory body or administrative agency or other
governmental body having jurisdiction over the Company or
over any of its properties, or any statute of any
jurisdiction applicable to the Company;
(d) The Arizona Corporation Commission has approved
all matters relating to the Company's participation in the
transactions contemplated by this Agreement which require
said approval, and no other consent, approval, authorization
or other order of any regulatory body or administrative
agency or other governmental body is legally required for
the Company's participation therein, except such as may have
been obtained or may be required under the securities laws
of any jurisdiction;
(e) The Facilities (i) are designed to meet applicable
federal, state and local requirements for the control of
pollution now in effect, (ii) are to be used to reduce,
xxxxx or prevent pollution and (iii) are located or are to
be located in San Xxxx County within fifteen miles outside
the corporate limits of the City and not within the
corporate limits of any municipality;
(f) All of the proceeds of the Bonds (exclusive of
accrued interest, if any, to be paid by the initial
purchasers of the Bonds upon delivery thereof) will be
expended to refund the Prior Bonds;
(g) The Company presently owns and undivided 50%
interest in Unit 1 of the Plant and an undivided 50%
interest in Unit 2 of the Plant.
(h) With respect to the Facilities as of the date of
execution and delivery of this Agreement, the Company has
good and marketable title to its interest in such Facilities
free and clear of all claims, liens and encumbrances, other
than Permitted Encumbrances;
(i) The Facilities consist of those facilities
described in Exhibit A attached hereto, and so long as the
Company owns an interest in the Facilities, the Company
shall cause to be made, or consent to, no changes to the
Facilities or to the operation thereof which would affect
the qualification of the Facilities as pollution control
facilities under the Act or impair the tax-exempt status of
interest on the Bonds;
(j) To the extent necessary to preserve the security
for the Bonds, the validity of the Bonds under the Act and
the tax-exempt status of interest on the Bonds, all material
certificates, approvals, permits and authorizations with
respect to the construction of the Facilities of applicable
local, state and federal governmental agencies have been
obtained, and the Facilities have been constructed and are
in operation in all material respects in accordance with
such certificates, approvals, permits and authorizations;
and
(k) The Company has used the proceeds of the Prior
Bonds and the proceeds from the sale of any facilities
financed with the Prior Bonds for purposes which are
authorized by the Act and which would not adversely affect
the exclusion from gross income for federal tax purposes of
interest on the Prior Bonds or the exemption of interest on
the Prior Bonds from State of New Mexico income taxation.
SECTION 2.03. Findings of the City. The City hereby
confirms its findings that its financing and refinancing of the
Company's interest in the Facilities will serve the public
purpose of the Act to protect and promote the health, welfare and
safety of the citizens of the State of New Mexico and its habitat
and wildlife, with the resultant higher level of employment and
economic activity and stability.
ARTICLE III
PRIOR CONVEYANCE TO THE CITY; THE FACILITIES
SECTION 3.01. Prior Conveyance to the City. The Company
and the City confirm that, pursuant to the Original Sale
Agreements, the Company has heretofore sold and conveyed to the
City, and the City has heretofore purchased and acquired from the
Company, the Company's interest in the Facilities, subject only
to Permitted Encumbrances.
SECTION 3.02. Revision of Plans and Specifications. The
Company may consent to one or more revisions to the plans and
specifications for the Facilities (including without limitation
any changes therein, additions thereto, substitutions therefor
and deletions therefrom) in any respect; provided, however, that,
if any such revision shall render inaccurate the description of
the Facilities contained in Exhibit A hereto, the Company shall
deliver to the City and the Trustee (a) a revised Exhibit A
containing a description of the Facilities as revised, the
accuracy of which shall have been certified by an Authorized
Company Representative, and (b) an opinion of Bond Counsel to the
effect that the Facilities as described in the revised Exhibit A
are such that the expenditure of the proceeds of the Bonds
pursuant to this Agreement will not, in and of itself, impair the
validity of the Bonds under the Act or the exclusion from gross
income for federal tax purposes of interest on the Bonds. A
revision of Exhibit A hereto pursuant to this Section 3.02 shall
not constitute an amendment, change or modification of this
Agreement within the meaning of Article XII of the Ordinance.
SECTION 3.03. Maintenance of Facilities; Remodeling; Notice
of Damages. The Company shall at all times exercise all of its
rights, powers, elections and options under the Plant Agreements
to cause the Facilities, and every element and unit thereof, to
be maintained, preserved and kept in thorough repair, working
order and condition and to cause all needful and proper repairs
and renewals thereto to be made; provided, however, that the
Company may exercise all of its rights, powers, elections and
options under the Plant Agreements to cause the operation of the
Facilities, or any element or unit thereof, to be discontinued
if, in the judgment of the Company, it is no longer advisable to
operate the same, or if the Company intends to sell or dispose of
the same and within a reasonable time shall endeavor to
effectuate such sale or disposition; provided further that prior
to any such discontinuation, the Company shall furnish to the
City and the Trustee a certificate executed by an Authorized
Company Representative stating that the operation of the
Facilities, or any element or unit thereof, is being discontinued
and the reasons therefor.
The Company may, subject to the provisions of Section 6.05
hereof, at its own expense consent to the remodeling of the
Facilities or to the making of such substitutions, modifications
and improvements to the Facilities from time to time as it, in
its discretion, may deem to be desirable for its uses and
purposes, which remodeling, substitutions, modifications and
improvements shall be included under the terms of this Agreement
as part of the Facilities.
After the occurrence of any material damage or loss to the
Facilities, if any Bonds are then Outstanding, the Company shall
notify the City as to the nature and extent of such damages or
loss and whether it is practicable and desirable to rebuild,
repair, or restore such damage or loss.
SECTION 3.04. Insurance. The Company shall exercise all of
its rights, powers, elections and options under the Plant
Agreements to keep the Facilities insured against fire, casualty,
public liability and other risks to the extent usually insured
against by companies owning and operating similar property, by
reputable insurance companies or, at the Company's election, with
respect to all or any element or unit of the Facilities, by means
of an adequate insurance fund set aside and maintained by it out
of its own earnings or in conjunction with other companies
through an insurance fund, trust or other agreement or, by means
of unfunded self-insurance as may be reasonable and customary by
companies owning and operating similar property. All proceeds of
such insurance shall be for the account of the Company.
SECTION 3.05. Condemnation; Eminent Domain. (a) In the
event that title to or the temporary use of the Facilities, or
any part thereof, shall be taken in condemnation or by the
exercise of the power of eminent domain by any governmental body
or by any person, firm or corporation acting under governmental
authority, any proceeds received by the City from any award or
awards in respect of the Facilities or any part thereof made in
such condemnation or eminent domain proceedings, after payment of
all expenses incurred in the collection thereof, shall to the
extent of the Company's interest therein be paid for the account
of the Company, and the City hereby assigns to the Company all of
its right, title and interest in and to any claim for and rights
with respect to any such condemnation award.
(b) The City shall cooperate fully with the Company in
the handling and conduct of any prospective or pending
condemnation proceedings with respect to the Facilities or any
part thereof. In no event will the City voluntarily settle or
consent to the settlement of any prospective or pending
condemnation proceedings with respect to the Facilities or any
part thereof without the written consent of the Company and the
City will, at the request of the Company, accept a sum in payment
therefor at any stage of the condemnation proceedings which the
Company shall certify to the City to be fair. Unless and until
such a request is made by the Company, the City will take or
cause to be taken all actions necessary to obtain the award of
fair compensation for the taking and the collecting thereof.
(c) The Company shall be entitled to the entire
proceeds of any condemnation award or portion thereof made for
damages to or takings of its own property other than the
Facilities.
ARTICLE IV
ISSUANCE AND SALE OF THE BONDS;
DISPOSITION OF PROCEEDS OF THE BONDS
SECTION 4.01. Issuance of the Bonds. The City shall issue
the Bonds under and in accordance with the Ordinance subject to
the provisions of the bond purchase agreement among the City, the
initial purchaser or purchasers of the Bonds and the Company.
The Company hereby approves the issuance of the Bonds and all
terms and conditions thereof.
SECTION 4.02. Issuance of Other Obligations. The City and
the Company expressly reserve the right to enter into, to the
extent permitted by law, but shall not be obligated to enter
into, an agreement or agreements other than this Agreement with
respect to the issuance by the City, under an ordinance or
ordinances other than the Ordinance, of obligations to provide
additional funds to pay the cost of construction of the
Facilities or obligations to refund all or any principal amount
of the Bonds, or any combination thereof.
SECTION 4.03. Disposition of Bond Proceeds. The City and
the Company shall enter into escrow arrangements with the trustee
for each series of Prior Bonds and shall cause a portion of the
proceeds of the Bonds in amount equal to (i) the proceeds of the
Bonds, other than accrued interest, if any, paid by the initial
purchaser or purchasers thereof, multiplied by the ratio
determined by multiplying outstanding principal amount of such
series of Prior Bonds by the aggregate outstanding principal
amount of the Prior Bonds, to be deposited in escrow with such
trustee to be applied to the payment of such series of Prior
Bonds upon the redemption thereof.
The City shall establish the Bond Fund with the Trustee in
accordance with Section 4.01 of the Ordinance. The accrued
interest, if any, paid by the initial purchasers of the Bonds
shall be deposited into the Bond Fund.
SECTION 4.04. Investment of Moneys in Funds and Accounts.
The Company and the City agree that any moneys held in any fund
or account created by the Ordinance shall be invested as provided
in the Ordinance.
ARTICLE V
PURCHASE BY THE COMPANY;
PURCHASE PRICE PAYMENTS; OTHER OBLIGATIONS
SECTION 5.01. Prior Purchase by the Company. The City and
the Company confirm that pursuant to the Original Sale
Agreements, the City has heretofore sold and conveyed to the
Company, without warranty of any kind whatsoever, and the Company
confirms that it has purchased and acquired from the City, the
interest in the Facilities acquired by the City as described in
Section 3.01 hereof. The parties hereto agree that
notwithstanding anything to the contrary in the Original Sale
Agreements, effective as of the date of initial issuance of the
Bonds the respective purchase prices for the interest in the
Facilities shall be the purchase price payments set forth in
Section 5.02 hereof.
SECTION 5.02. Purchase Price Payments. As the purchase
price to be paid by the Company for the interest in the
Facilities which comprise the Company Project, the Company shall
pay, or cause to be paid, to the Trustee for the account of the
City an amount equal to the aggregate principal amount of the
Bonds from time to time Outstanding and, as interest on such
amount, an amount equal to premium, if any, and interest on such
Bonds, such amounts to be paid in installments due on the dates,
in the amounts and in the manner provided in the Ordinance for
the City to cause amounts to be deposited in the Bond Fund for
the timely payment of the principal of and premium, if any, and
interest on the Bonds whether at stated maturity, upon redemption
or acceleration or otherwise; provided, however, that the
obligation of the Company to make any such payment hereunder
shall be reduced by the amount of any reduction under Section
2.12 and Section 3.05 of the Ordinance of the amount of the
corresponding payment required to be made by the City thereunder.
SECTION 5.03. Payments Pledged and Assigned; Obligation
Absolute. It is understood and agreed that all Purchase Price
Payments are, by the Ordinance, to be pledged by the City to the
Trustee, and that all rights and interest of the City hereunder
(except for the City's rights under Sections 5.04, 5.05, 6.03 and
8.05 hereof and any rights of the City to receive notices,
certificates, requests, requisitions and other communications
hereunder) are to be pledged and assigned to the Trustee. The
Company assents to such pledge and assignment and agrees that the
obligation of the Company to make the Purchase Price Payments and
the other charges payable hereunder shall be absolute,
irrevocable and unconditional and shall not be subject to
cancellation, termination or abatement, or to any defense other
than payment or to any right of set-off, counterclaim or
recoupment arising out of any breach by the City or the Trustee
or any other party under this Agreement, the Ordinance or
otherwise, or out of any obligation or liability at any time
owing to the Company by the City, the Trustee or any other party,
and, further, that the Purchase Price Payments and the other
payments due and charges payable hereunder shall continue to be
payable at the times and in the amounts herein and therein
specified, whether or not the Facilities, or any portion thereof,
shall have been completed or shall have been destroyed by fire or
other casualty, or title thereto, or the use thereof, shall have
been taken by the exercise of the power of eminent domain, and
that there shall be no abatement of or diminution in any such
payments by reason thereof, whether or not the Facilities shall
be used or useful, whether or not any applicable laws,
regulations or standards shall prevent or prohibit the use of the
Plant or the Facilities, or for any other reason, all of the
foregoing being subject, however, to the provisions of Sections
6.01 and 7.02 hereof.
SECTION 5.04. Payment of Expenses. (a) The Company shall
pay all Administration Expenses, including, without limitation,
Administration Expenses incurred at and subsequent to the time
the Bonds are deemed to have been paid in accordance with Article
VIII of the Ordinance. The payment of the compensation and the
reimbursement of expenses and advances of the Trustee, of the
paying agent, any co-paying agent and the registrar under the
Ordinance shall be made directly to such entities.
(b) The City may submit to the Company periodic
statements, not more frequently than monthly, for the reasonable
value of services of any City employees utilized, and the full
amount of any City expenses incurred, by the City in connection
with the performance or attainment by the City of its obligations
and rights under or pursuant to the Ordinance, the Bonds or this
Agreement, and the Company shall make payment to the City of the
full amount of each such statement within thirty (30) days after
the Company receives such statement, provided that the Company
within such thirty (30) day period may in writing and in good
faith specifically protest all or any portion of the amounts
included in such statement and in such event the Company shall
not be obligated to make payment to the City of the amount which
has been protested in such manner until ten (10) days after such
protest shall have been resolved either by agreement between the
City and the Company or by an appropriate tribunal. The Company
agrees that the provisions of this Section 5.04 shall survive the
payment, redemption or defeasance of the Bonds.
SECTION 5.05. Indemnification. The Company releases the
City and the Trustee from, and covenants and agrees that neither
the City nor the Trustee shall be liable for, and covenants and
agrees, to indemnify and hold harmless the City and the Trustee
and their officers (including members of the City Council),
employees and agents from and against, any and all losses,
claims, damages, liabilities (including, without limitation,
those resulting from any environmental laws), taxes (including,
without limitation, gross receipts taxes but, with respect to the
Trustee, not including taxes owing in the ordinary course of
business), or expenses, of every conceivable kind, character and
nature whatsoever arising out of, resulting from or in any way
connected with (1) the Facilities or the conditions, occupancy,
use, possession, conduct or management of, or work done in or
about, or from the planning, design, acquisition, installation or
construction of the Facilities or any part thereof, except for
those arising out of the activities described in Section 56-7-1 A
or B, N.M.S.A. 1978, or in Section 56-7-2 A or B, N.M.S.A. 1978,
to the extent such Sections are applicable; (2) the issuance of
any Bonds or any certifications or representations made in
connection therewith and the carrying out of any of the
transactions contemplated by the Bonds, the Ordinance and this
Agreement; (3) the Trustee's acceptance or administration of the
trusts under the Ordinance; or (4) any untrue statement or
alleged untrue statement of any material fact or omission or
alleged omission to state a material fact necessary to make the
statements made, in light of the circumstances under which they
were made, not misleading, in any official statement or other
offering circular utilized by the City or any underwriter or
placement agent in connection with the sale of any Bonds;
provided that such indemnity shall not be required for losses,
claims, damages, liabilities or expenses that result from, in the
case of parties other than the City, negligence or from willful
misconduct on the part of the party seeking such indemnity. The
indemnity of the Trustee and the City required by this Section
shall be only to the extent that any loss sustained by the
Trustee or the City, as the case may be, exceeds the net proceeds
the Trustee or the City, as the case may be, receives from any
insurance carried with respect to the loss sustained. The
Company further covenants and agrees, to the extent permitted by
law, to pay or to reimburse the City and the Trustee and their
officers, employees and agents for any and all reasonable costs,
attorneys fees and expenses, liabilities or expenses incurred in
connection with investigating, defending against or otherwise in
connection with any such losses, claims, damages, liabilities,
expenses or actions, except to the extent that the same arise out
of the negligence or willful misconduct of the party claiming
such payment or reimbursement. The provisions of this Section
shall survive the retirement of the Bonds or resignation or
removal of the Trustee.
SECTION 5.06. Payment of Taxes; Discharge of Liens. The
Company shall: (a) pay, or make provision for payment of, all
lawful taxes and assessments, including income, profits, property
or excise taxes, if any, or other municipal or governmental
charges, levied or assessed by any federal, state or municipal
government or political body upon the Facilities or any part
thereof or upon the City with respect to the Purchase Price
Payments, when the same shall become due; and (b) pay or cause to
be satisfied and discharged or make adequate provision to satisfy
and discharge, within sixty (60) days after the same shall
accrue, any lien or charge upon the Purchase Price Payments, and
all lawful claims or demands for labor, materials, supplies or
other charges which, if unpaid, might be or become a lien upon
such amounts, except Permitted Encumbrances; provided, that, if
the Company shall first notify the City and the Trustee of its
intention so to do, the Company may in good faith contest any
such lien or charge or claims or demands in appropriate legal
proceedings, and in such event may permit the items so contested
and identified as such by the Company to remain undischarged and
unsatisfied during the period of such contest and any appeal
therefrom, unless the Trustee shall notify the Company in writing
that, in the opinion of counsel to the Trustee, based upon
material facts disclosed to the Trustee without any duty of
investigation, by nonpayment of any such items the lien of the
Ordinance as to the Purchase Price Payments will be materially
endangered, in which event the Company shall promptly pay and
cause to be satisfied and discharged all such unpaid items. The
City shall cooperate fully with the Company in any such contest.
ARTICLE VI
SPECIAL COVENANTS
SECTION 6.01. Maintenance of Corporate Existence. Except
as permitted in this Section 6.01, the Company shall maintain its
corporate existence, shall not sell, transfer or otherwise
dispose of all of its assets, as or substantially as an entirety,
and shall not consolidate with or merge with or into another
corporation. The Company may consolidate with or merge into
another corporation incorporated under the laws of the United
States of America, any state thereof or the District of Columbia,
or sell, transfer or otherwise dispose of all of its assets, as
or substantially as an entirety, to any Person, if the surviving
or resulting corporation (if other than the Company) or the
transferee Person, as the case may be, prior to or simultaneously
with such merger, consolidation, sale, transfer or other
disposition, assumes, by delivery to the Trustee and the City of
an instrument in writing satisfactory in form to the Trustee and
the City, all the obligations of the Company under this
Agreement, including without limitation the obligations of the
Company under Section 5.02 hereof. Upon such an assumption
following any such sale, transfer or other disposition of assets,
the Company shall be released and discharged from all liability
in respect of all obligations under this Agreement.
Notwithstanding the foregoing, in the case of any such sale,
transfer or other disposition of assets, which do not include the
Facilities, the Company shall remain liable in respect of all
obligations under this Agreement other than the obligations under
Section 5.02 hereof, and the transferee shall not be required to
assume any obligations hereunder other than the obligations under
Section 5.02 hereof; provided, however, that the transferee shall
be required to assume all such other obligations unless the
Company shall have delivered to the City and the Trustee an
opinion of Bond Counsel to the effect that the non-assumption by
the transferee of such other obligations will not impair the
validity under the Act of the Bonds and will not adversely affect
the exclusion from gross income for federal tax purposes of
interest on the Bonds.
If consolidation, merger or sale, transfer or other
disposition is made as permitted by this Section 6.01, the
provisions of this Section 6.01 shall continue in full force and
effect and no further consolidation, merger or sale or other
transfer or other disposition shall be made except in compliance
with the provisions of this Section 6.01.
Anything in this Agreement to the contrary notwithstanding,
the sale, transfer or other disposition by the Company of all of
its facilities (a) for the generation of electric energy, (b) for
the transmission of electric energy or (c) for the distribution
of electric energy, in each case considered alone, or all of its
facilities described in clauses (a) and (b), considered together,
or all of its facilities described in clauses (b) and (c),
considered together, shall in no event be deemed to constitute a
sale, transfer or other disposition of all the properties of the
Company, as or substantially as an entirety, unless, immediately
following such sale, transfer or other disposition, the Company
shall own no properties in the other such categories of property
not so sold, transferred or otherwise disposed of. The character
of particular facilities shall be determined by reference to the
Uniform System of Accounts prescribed for public utilities and
licensees subject to the Federal Power Act, as amended, to the
extent applicable.
SECTION 6.02. Permits or Licenses. In the event that it
may be necessary for the proper performance of this Agreement on
the part of the Company or the City that any application or
applications for any permit or license to do or to perform
certain things be made to any governmental or other agency by the
Company or the City, the Company and the City each shall, upon
the request of either, execute such application or applications.
SECTION 6.03. City's Access to Facilities. The City shall
have the right, upon appropriate prior notice to the Company, to
have reasonable access to the Facilities during normal business
hours for the purpose of making examinations and inspections of
the same.
SECTION 6.04. Tax-Exempt Status of Interest on Bonds.
(a) It is the intention of the parties hereto that interest on
the Bonds shall be and remain tax-exempt, and to that end the
covenants and agreements of the City and the Company in this
Section 6.04 and the Tax Agreement are for the benefit of the
Owners from time to time of the Bonds.
(b) The City covenants and agrees that it will not
take or omit to take any action reasonably within its control
that will cause the Bonds to be "arbitrage bonds" within the
meaning of Section 148 of the Code or otherwise subject to
federal income taxation by reason of Section 103 and Section 141
through 150 of the Code or Section 103 of the 1954 Code and Title
XIII of the Tax Reform Act of 1986, as applicable, and any
applicable regulations promulgated thereunder. To such end, the
City covenants to the extent reasonably within its control to
comply with all covenants set forth in the Tax Agreement, which
is hereby incorporated by reference as though fully set forth
herein.
(c) The Company covenants and agrees for the benefit
of the Owners from time to time of the Bonds that it will not
directly or indirectly use or permit the use of (to the extent
within its control) the proceeds of any of the Bonds or any other
funds, or take or omit to take any action, if and to the extent
such use, or the taking or omission to take such action, would
cause any of the Bonds to be "arbitrage bonds" within the meaning
of Section 148 of the Code or otherwise subject to federal income
taxation by reason of Section 103 and 141 through 150 of the Code
or Section 103 of the 1954 Code and Title XIII of the Tax Reform
Act of 1986, as applicable, and any applicable regulations
promulgated thereunder. To such ends, the Company will comply
with all requirements of such Section 148 to the extent
applicable to the Bonds. In the event that at any time the
Company is of the opinion that for purposes of this Section
6.04(c) it is necessary to restrict or limit the yield on the
investment of any moneys held by the Trustee under the Ordinance,
the Company shall so notify the Trustee in writing.
Without limiting the generality of the foregoing, the
Company agrees that there shall be paid from time to time all
amounts required to be rebated to the United States of America
pursuant to Section 148(f) of the Code and any applicable
Treasury Regulations. This covenant shall survive payment in
full or defeasance of the Bonds and the satisfaction and
discharge of the Ordinance. The Company specifically covenants
to pay or cause to be paid the Rebate Requirement as defined and
described in the Tax Agreement.
(d) The Company certifies and represents that it has
not taken or (to the extent within its control) permitted to be
taken, and the Company covenants and agrees that it will not take
or (to the extent within its control) permit to be taken any
action which will cause the interest on the Bonds to become
includable in gross income for federal income tax purposes;
provided, however, that neither the Company nor the City shall be
deemed to have violated the covenants set forth in this Section
6.04 if the interest on any of the Bonds becomes taxable to a
person solely because such person is a "substantial user" of the
Project or a "related person" within the meaning of Section
103(b)(13) of the 1954 Code and provided, further, that none of
the covenants and agreements herein contained shall require
either the Company or the City to enter an appearance or
intervene in any administrative, legislative or judicial
proceeding in connection with any changes in applicable laws,
rules or regulations or in connection with any decisions of any
court or administrative agency or other governmental body
affecting the taxation of interest on the Bonds. The Company
acknowledges having read Section 7.08 of the Ordinance and agrees
to perform all duties imposed on it by such Section 7.08, by this
Section and by the Tax Agreement. Insofar as Section 7.08 of the
Ordinance and the Tax Agreement impose duties and
responsibilities on the Company, they are specifically
incorporated herein by reference.
(e) Notwithstanding any provision of this Section 6.04
and Section 7.08 of the Ordinance, if the Company shall provide
to the City and the Trustee an opinion of Bond Counsel to the
effect that any specified action required under this Section 6.04
and Section 7.08 of the Ordinance is no longer required or that
some further or different action is required to maintain the tax-
exempt status of interest on the Bonds, the Company, the Trustee
and the City may conclusively rely upon such opinion in complying
with the requirements of this Section 6.04, and the covenants
hereunder shall be deemed to be modified to that extent.
SECTION 6.05. Use of Facilities. So long as any Bonds are
Outstanding and the Facilities are operated by or for the benefit
of the Company, the Company shall exercise all of its rights,
powers, elections and options under the Plant Agreements to cause
the Facilities to be used for purposes contemplated by the Act
and in the Tax Agreement.
SECTION 6.06. Financing Statements. The Company shall file
and record, or cause to be filed and recorded, all financing
statements and continuation statements referred to in Section
7.07 of the Ordinance.
SECTION 6.07. No Warranties. The City makes no warranty,
either express or implied, with respect to the Facilities as a
whole or with respect to any item or portion of the Facilities.
Without limiting the effect of the preceding sentence, it is
expressly agreed that in connection with the sale or conveyance
pursuant to Section 5.01 of this Agreement (a) the City make no
warranty that the title conveyed shall be good or that its
transfer is rightful or that the goods shall be delivered free
from any security interest or other lien or encumbrance, (b) the
City makes NO WARRANTY OF MERCHANTABILITY, and (c) THERE ARE NO
WARRANTIES WHICH EXTEND BEYOND THE DESCRIPTION ON THE FACE
HEREOF.
SECTION 6.08. Quiet Enjoyment. The City covenants that the
Company, upon observing and performing the terms, conditions and
covenants on the Company's part to be observed and performed
under this Agreement, shall peaceably and quietly have, hold and
enjoy the Company Project as purchaser in possession, free from
molestation, hindrance, eviction or disturbance by the City or by
any other person or persons claiming the same by, through or
under the City.
SECTION 6.09. Additional Payments by Company Concerning the
Facilities. In addition to the payments provided for in Section
5.02 and Section 5.04 hereof, the Company will pay, or will
exercise all of its rights, powers, elections and options under
the Plant Agreements to cause to be paid, as applicable, all of
the expenses of operation of the Facilities, including, without
limitation, the cost of all necessary and proper repairs,
replacements and renewals made pursuant to Section 3.03 hereof
and premiums for insurance pursuant to Section 3.04 hereof.
SECTION 6.10 Qualification in New Mexico. The Company
agrees that throughout the term of this Agreement it, or any
successor or assignee as permitted by Section 6.01 or Section
7.02 hereof, will be qualified to do business in the State of New
Mexico.
ARTICLE VII
ASSIGNMENT, LEASING AND SELLING
SECTION 7.01. By the City. Except as provided in Article V
of this Agreement, the City will not sell, lease, assign,
transfer, convey or otherwise dispose of its interest in the
Facilities or any portion thereof or interest therein or in the
revenues therefrom without the written consent of the Company,
nor will it create or suffer to be created any debt, lien or
charge thereon, not consented to by the Company, except Permitted
Encumbrances.
SECTION 7.02. By the Company. The Company's interest in
this Agreement may be assigned as a whole or in part, and its
interest in the Facilities may be leased, sold, transferred or
otherwise disposed of by the Company as a whole or in part
(whether an interest in a specific element or unit or an
undivided interest), to any Person; provided, however, that no
such assignment, lease, sale, transfer or other disposition (a)
shall relieve the Company from its primary liability for its
obligations under Section 5.02 hereof or (b) shall be made unless
the assignee, lessee, purchaser or other transferee, as the case
may be, prior to or simultaneously with such assignment, lease,
sale, transfer or other disposition, assumes, by delivery of an
instrument to the Trustee and the City of an instrument in
writing satisfactory in form to the Trustee, all other
obligations of the Company hereunder to the extent of the
interest assigned, leased, sold, transferred or otherwise
disposed of, and the Company shall be released of and discharged
from such obligations to the extent so assumed. Notwithstanding
the foregoing, (a) if (i) the Company's interest in this
Agreement shall be assigned as a whole or in undivided part, (ii)
the Company's interest in the Facilities shall be leased as a
whole or in undivided part and the term of such leasehold or the
term of any extension or extensions thereof at the option of the
Company shall extend beyond the maturity date of the Bonds or
(iii) the Company's interest in the Facilities shall be sold,
transferred or otherwise disposed of as a whole or in undivided
part, and (b) if the assignee, lessee, purchaser or other
transferee shall assume the obligations of the Company under
Section 5.02 hereof for the remaining term of this Agreement, to
the extent of such assignment, lease, sale, transfer or other
disposition, the Company shall be released from and discharged of
all liability in respect of such obligations to the extent so
assumed (but only to such extent); provided, however, that the
release and discharge of the Company pursuant to clause (b) shall
be conditioned upon delivery by the Company to the City and the
Trustee of a certificate of an Independent Expert (as hereinafter
defined) describing the interests so assigned, leased, sold,
transferred or otherwise disposed of, together with all other
rights, interests, assets and/or properties assigned, leased,
sold, transferred or otherwise disposed of by the Company to the
same Person in the same or a related transaction, stating that
such rights, interests, assets and/or properties so described
constitute facilities for the generation, transmission and/or
distribution of electric energy and stating that, in the opinion
of such Independent Expert, the Fair Value (as hereinafter
defined) of such rights, interests, assets and/or properties to
the Person acquiring the same is not less than an amount equal to
10/7 of the sum of (x) the aggregate principal amount of the
Bonds then Outstanding and (y) the outstanding principal amount
of all other obligations of the Company representing indebtedness
for borrowed money or for the deferred purchase price of property
which are being assumed by such Person; and provided, further,
that after any such assumption, release and discharge as
aforesaid, the Company may again assume such obligations under
Section 5.02 hereof, in whole or in part, at any time and from
time to time, and, to the extent of any such assumption by the
Company (but only to such extent), the aforesaid assignee,
lessee, purchaser or other transferee shall be released from and
discharged of all liability in respect of such obligations.
Anything herein to the contrary notwithstanding, the Company
shall not make any assignment, lease or sale as provided in the
immediately preceding paragraph unless it shall have furnished to
the City and the Trustee an opinion of Bond Counsel to the effect
that the proposed assignment, lease or sale will not impair the
validity under the Act of the Bonds and will not adversely affect
the exclusion from gross income for federal tax purposes of
interest on the Bonds.
After any lease, sale, transfer or other disposition of any
element or unit of the Facilities, or any interest therein, the
Company may, at its option, cause such element or unit, or
interest therein, to no longer be deemed to be part of the
Facilities for the purposes of this Agreement by delivering to
the City and the Trustee the agreements or other documents
required pursuant to Section 7.03 hereof together with an
instrument signed by an Authorized Company Representative stating
that such element or unit, or interest therein, shall no longer
be deemed to be part of the Facilities for the purposes of this
Agreement.
For purposes of this Section 7.02:
(a) "Independent Expert" means a Person which (i) is
an engineer, appraiser or other expert and which, with respect to
any certificate to be delivered pursuant to this Section, is
qualified to pass upon the matter set forth in such certificate
and (ii)(A) is in fact independent, (B) does not have any direct
material financial interest in the transferee or in any obligor
upon the Bonds or under this Agreement or in any affiliate of the
transferee or any such obligor, (C) is not connected with the
transferee or any such obligor as an officer, employee, promoter,
underwriter, trustee, partner, director or any person performing
similar functions and (D) is approved by the Trustee in the
exercise of reasonable care; for purposes of this definition
"engineer" means a Person engaged in the engineering profession
or otherwise qualified to pass upon engineering matters
(including, but not limited to, a Person licensed as a
professional engineer, whether or not then engaged in the
engineering profession); and for purposes of this definition
"appraiser" means a Person engaged in the business of appraising
property or otherwise qualified to pass upon the Fair Value or
fair market value of property.
(b) "Fair Value" means the fair value of the
interests, rights, assets and/or properties assigned, leased,
sold, transferred or otherwise disposed of (but, in the case of a
lease, only to the extent of such lease) as may be determined by
reference to (i) except in the case of a lease, the amount which
would be likely to be obtained in an arm's-length transaction
with respect to such interests, rights, assets and/or properties
between an informed and willing buyer and an informed and willing
seller, under no compulsion, respectively, to buy or sell, (ii)
in the case of a lease, the amount (discounted to present value
at a rate not lower than the taxable equivalent of the yield to
maturity of the Bonds based on prevailing market prices
immediately prior to the first public announcement of the
proposed transaction) which would be likely to be obtained in an
arm's-length transaction with respect to such interests, rights,
assets and/or properties between an informed and willing lessee
and an informed and willing lessor, neither under any compulsion
to lease; (iii) the amount of investment with respect to such
interests, rights, assets and/or properties which, together with
a reasonable return thereon, would be likely to be recovered
through ordinary business operations or otherwise, (iv) the cost,
accumulated depreciation and replacement cost with respect to
such interests, rights, assets and/or properties and/or (v) any
other relevant factors; provided, however, that (x) Fair Value
shall be determined without deduction for any mortgage, deed of
trust, pledge, security interest, encumbrance, lease,
reservation, restriction, servitude, charge or similar right or
any other lien of any kind and (y) the Fair Value to the
transferee of any property shall not reflect any reduction
relating to the fact that such property may be of less value to a
Person which is not the owner, lessee or operator of the property
or any portion thereof than to a Person which is such owner,
lessee or operator. Fair Value may be determined, without
physical inspection, by the use of accounting and engineering
records and other data maintained by the Company or the
transferee or otherwise available to the Expert certifying the
same.
SECTION 7.03. Instrument Furnished to the City and Trustee.
The Company shall, within fifteen (15) days after the delivery
thereof, furnish to the City and the Trustee a true and complete
copy of the agreements or other documents effectuating any such
assignment, lease, sale, transfer or other disposition.
SECTION 7.04. Limitation. This Agreement shall not be
assigned nor shall the Facilities be leased, sold, transferred or
otherwise disposed of, in whole or in part, except as provided in
this Article VII or in Section 6.01 or 5.03 hereof. This Article
VII shall not apply to any sale, transfer or other disposition by
the Company of all of its assets, as or substantially as an
entirety, as contemplated in Section 6.01.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
SECTION 8.01. Events of Default. Each of the following
events shall constitute and is referred to in this Agreement as
an "Event of Default":
(a) a failure by the Company to make any Purchase
Price Payment, which failure shall have resulted in an
"Event of Default" under clause (a) or (b) of Section 9.01
of the Ordinance;
(b) a failure by the Company to pay when due any other
amount required to be paid under this Agreement or to
observe and perform any covenant, condition or agreement on
its part to be observed or performed (other than a failure
described in clause (a) above), which failure shall continue
for a period of sixty (60) days after written notice,
specifying such failure and requesting that it be remedied,
shall have been given to the Company by the City or the
Trustee, unless the City and the Trustee shall agree in
writing to an extension of such period prior to its
expiration; provided, however, that the City and the Trustee
shall be deemed to have agreed to an extension of such
period if corrective action is initiated by the Company
within such period and is being diligently pursued; or
(c) the dissolution or liquidation of the Company, or
failure by the Company promptly to lift any execution,
garnishment or attachment of such consequence as will impair
its ability to make any payments under this Agreement, or
the entry of an order for relief by a court of competent
jurisdiction in any proceeding for its liquidation or
reorganization under the provisions of any bankruptcy act or
under any similar act which may be hereafter enacted, or an
assignment by the Company for the benefit of its creditors,
or the entry by the Company into an agreement of composition
with its creditors (the term "dissolution or liquidation of
the Company," as used in this clause, shall not be construed
to include the cessation of the corporate existence of the
Company resulting either from a merger or consolidation of
the Company into or with another corporation or a
dissolution or liquidation of the Company following a
transfer of all or substantially all its assets, as or
substantially as an entirety, under the conditions
permitting such actions contained in Section 6.01 hereof).
SECTION 8.02. Force Majeure. The provisions of Section
8.01 hereof are subject to the following limitations: if by
reason of acts of God; strikes, lockouts or other industrial
disturbances; acts of public enemies; orders of any kind of the
government of the United States or of the State of New Mexico, or
any department, agency, political subdivision, court or official
of any of them, or any civil or military authority;
insurrections; riots; epidemics; landslides; lightning;
earthquakes; volcanoes; fires; hurricanes; tornadoes; storms;
floods; washouts; droughts; arrests; restraint of government and
people; civil disturbances; explosions; breakage or accident to
machinery; partial or entire failure of utilities; or any cause
or event not reasonably within the control of the Company, the
Company is unable in whole or in part to carry out any one or
more of its agreements or obligations contained herein, other
than its obligations under Sections 5.02, 5.04, 5.06, and 6.01
hereof, the Company shall not be deemed in default by reason of
not carrying out said agreement or agreements or performing said
obligation or obligations during the continuance of such
inability. The Company shall make reasonable effort to remedy
with all reasonable dispatch the cause or causes preventing it
from carrying out its agreements; provided, that the settlement
of strikes, lockouts and other industrial disturbances shall be
entirely within the discretion of the Company, and the Company
shall not be required to make settlement of strikes, lockouts and
other industrial disturbances by acceding to the demands of the
opposing party or parties when such course is in the judgment of
the Company unfavorable to the Company. Any failure of the
Company to perform its obligations under Sections 5.02, 5.04,
5.06 and 6.01 hereof shall constitute an Event of Default
hereunder regardless of the reason for such failure to perform.
SECTION 8.03. Remedies. (a) Upon the occurrence and
continuance of any Event of Default described in clause (a) of
Section 8.01 hereof, and further upon the condition that, in
accordance with the terms of the Ordinance, the Bonds shall have
been declared to be immediately due and payable pursuant to any
provision of the Ordinance, the Purchase Price Payments shall,
without further action, become and be immediately due and
payable.
Any waiver of any "Event of Default" under the
Ordinance and a rescission and annulment of its consequences
shall constitute a waiver of the corresponding Event or
Events of Default under this Agreement and a rescission and
annulment of the consequences thereof.
(b) Upon the occurrence and continuance of any Event
of Default, the City, or the Trustee with respect to the
rights of the City assigned to the Trustee by the Ordinance,
may take any action at law or in equity to collect any
payments then due and thereafter to become due, or to
enforce performance and observance of any obligation,
agreement or covenant of the Company hereunder.
(c) Any amounts collected by the Trustee from the
Company pursuant to this Section 8.03 shall be applied in
accordance with the Ordinance.
SECTION 8.04. No Remedy Exclusive. No remedy conferred
upon or reserved to the City hereby is intended to be exclusive
of any other available remedy or remedies, but each and every
such remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law
or in equity or by statute. No delay or omission to exercise any
right or power accruing upon any default shall impair any such
right or power or shall be construed to be a waiver thereof, but
any such right or power may be exercised from time to time and as
often as may be deemed expedient. In order to entitle the City
to exercise any remedy reserved to it in this Article VIII, it
shall not be necessary to give any notice, other than such notice
as may be herein expressly required.
SECTION 8.05. Reimbursement of Attorneys' and Agents' Fees.
If the Company shall default under any of the provisions hereof
and the City or the Trustee shall employ attorneys or agents or
incur other reasonable expenses for the collection of payments
due hereunder or for the enforcement of performance or observance
of any obligation or agreement on the part of the Company
contained herein, the Company will on demand therefor reimburse
the City or the Trustee and any predecessor Trustee, as the case
may be, for the reasonable fees of such attorneys or agents and
such other reasonable expenses so incurred.
SECTION 8.06. Waiver of Breach. In the event any
obligation created hereby shall be breached by either of the
parties and such breach shall thereafter be waived by the other
party, such waiver shall be limited to the particular breach so
waived and shall not be deemed to waive any other breach
hereunder. In view of the assignment of certain of the City's
rights and interest hereunder to the Trustee, the City shall have
no power to waive any breach hereunder by the Company in respect
of such rights and interest without the consent of the Trustee,
and the Trustee may exercise any of the rights of the City
hereunder.
ARTICLE IX
PREPAYMENT OF PURCHASE PRICE PAYMENTS;
REDEMPTION OF BONDS
SECTION 9.01. Prepayment of Purchase Price Payments;
Redemption of Bonds. The Company shall have, and is hereby
granted, the option to prepay all or any portion of the Purchase
Price Payments and in conjunction therewith to direct the
redemption, or provision for payment or redemption, of a
principal amount of Bonds equal to the amount of principal of the
Purchase Price Payments to be prepaid, any such redemption to be
in accordance with Section 3.01(a) or (b) of the Ordinance. In
order to exercise such option, the Company shall deliver to the
City and the Trustee a notice designating the principal amount of
the Bonds to be redeemed, or for the payment or redemption of
which provision is to be made, and, in the case of redemption of
Bonds, or provision therefor, specifying the date of redemption
and the applicable redemption provision of the Ordinance. Upon
receipt of such notice, the City shall take, or cause to be
taken, the actions required by the Ordinance to discharge the
lien created thereby through the redemption, or provision for
payment or redemption, of all Bonds then Outstanding, or to
effect the redemption, or provision for payment or redemption, of
less than all the Bonds then Outstanding. The date of any such
redemption shall not be less than 45 days from the date such
notice is given (unless a shorter notice is satisfactory to the
Trustee). Unless otherwise stated therein, such notice shall be
revocable by the Company at any time prior to the time at which
the Bonds to be redeemed, or for the payment or redemption of
which provision is to be made, are first deemed to be paid in
accordance with Article VIII of the Ordinance. The Company shall
furnish any moneys or Government Obligations (as defined in the
Ordinance) required by the Ordinance to be deposited with the
Trustee or otherwise paid by the City in connection with any of
the foregoing purposes. The redemption, or provision for payment
or redemption, of Bonds as contemplated in this Section shall,
pro tanto, reduce and constitute a prepayment of the Purchase
Price Payments.
SECTION 9.02. Compliance with the Ordinance. Anything in
this Agreement to the contrary notwithstanding, the City and the
Company shall take all actions required by this Agreement and the
Ordinance in order to comply with any provisions of the Ordinance
requiring the mandatory redemption of Bonds, including, without
limitation, Section 3.01(c) of the Ordinance.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Term of Agreement. This Agreement shall
remain in full force and effect from the date hereof until the
right, title and interest of the Trustee in and to the Trust
Estate (as defined in the Ordinance) shall have ceased,
terminated and become void in accordance with Article VIII of the
Ordinance and until all payments required under this Agreement
shall have been made. Notwithstanding the foregoing, the
covenants contained in Section 5.04, 5.05, Section 6.04 and 8.05
hereof shall survive the termination of this Agreement.
SECTION 10.02. Effect of Plant Agreements. The City
acknowledges that the Company has executed and delivered certain
of the Plant Agreements and may execute and deliver others. The
Company agrees that none of the Plant Agreements heretofore or
hereafter executed and delivered shall in any way affect or
diminish the rights of the City or the obligations to the City of
the Company created by this Agreement. The City acknowledges
that the Facilities are subject to the lien of the Company
Mortgages and are or may be subject to other Permitted
Encumbrances.
SECTION 10.03. Notices. Except as otherwise provided in
this Agreement, all notices, certificates, requests, requisitions
and other communications hereunder shall be in writing and shall
be sufficiently given and shall be deemed given when mailed by
registered mail, postage prepaid, addressed as follows: if to the
City, at 000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000,
Attention: Treasurer; if to the Company, at 000 Xxxx Xxxxx
Xxxxxx, Xxxxxx, Xxxxxxx 00000, Attention: Treasurer; and if to
the Trustee, at such address as shall be designated by it in
accordance with the provisions of the Ordinance. A copy of each
notice, certificate, request or other communication given
hereunder to the City, the Company, or the Trustee shall also be
given to the others. The City, the Company, and the Trustee may,
by notice given hereunder, designate any further or different
addresses to which subsequent notices, certificates, requests or
other communications shall be sent.
SECTION 10.04. Parties in Interest. This Agreement shall
inure to the benefit of and shall be binding upon the City, the
Company and their respective successors and assigns, and no other
person, firm or corporation shall have any right, remedy or claim
under or by reason of this Agreement; provided, however, that the
rights and remedies granted to the City in Article VIII hereof
shall inure to the benefit of the Trustee, on behalf of the
Owners from time to time of the Bonds, and shall be enforceable
by the Trustee as a third party beneficiary or as assignee of the
City; and provided, further, that any obligation of the City
created by or arising out of this Agreement shall not be a
general obligation of the City within the meaning of Article 9,
Sections 12 and 13 of the Constitution of the State of New Mexico
and shall be payable solely out of the Receipts and Revenues of
the City from the Sale Agreement and shall never constitute an
indebtedness of the City within the meaning of any state
constitutional provision or statutory limitation and shall never
constitute or give rise to a pecuniary liability of the City or a
charge upon the City's general credit or against its taxing
powers.
SECTION 10.05. Amendments. This Agreement may be amended
only by written agreement of the parties hereto, subject to the
limitations set forth herein and in the Ordinance.
SECTION 10.06. Counterparts. This Agreement may be
executed in any number of counterparts, each of which, when so
executed and delivered, shall be an original; but such
counterparts shall together constitute but one and the same
Agreement.
SECTION 10.07. Severability. If any clause, provision or
section of this Agreement shall, for any reason, be held illegal
or invalid by any court, the illegality or invalidity of such
clause, provision or section shall not affect any of the
remaining clauses, provisions or sections hereof, and this
Agreement shall be construed and enforced as if such illegal or
invalid clause, provision or section had not been contained
herein. In case any agreement or obligation contained in this
Agreement be held to be in violation of law, then such agreement
or obligation shall be deemed to be the agreement or obligation
of the City or the Company, as the case may be, to the full
extent permitted by law.
SECTION 10.08. Governing Law. The laws of the State of New
Mexico shall govern the construction and enforcement of this
Agreement.
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Amended and Restated Installment Sale Agreement to be duly
executed as of the day and year first above written.
CITY OF FARMINGTON,
as Vendor
ATTEST: By /s/ Xxxxxx X. Xxxxxx
----------------------
Mayor
/s/ Xxxx X. Xxxxx
-----------------------------
City Clerk
(SEAL) TUCSON ELECTRIC POWER COMPANY,
as Vendee
ATTEST: By /s/ Xxxxx Xxxxxx
----------------------
Vice President
/s/ Xxxxxxx Xxxxxx Xx.
--------------------------
Assistant Secretary
EXHIBIT A
DESCRIPTION OF THE FACILITIES
The Facilities consist of various systems and facilities to
xxxxx or control water and atmospheric pollution from the
generation of electricity by Units 1 and 2 of the San Xxxx
Generating Station (the "Plant"). Such systems and facilities
contain equipment to collect, remove, alter, and dispose of air
and water pollutants so that gaseous and liquid emissions to the
environment from Units 1 and 2 meet all applicable government air
and water quality standards. Both Units 1 and 2 are coal-fired,
steam turbine electric generating units. Combustion of
pulverized coal in these Units is the primary cause of pollution
at the Plant. Ash, nitrogen oxide, and sulfur oxides are by-
products of combustion that must be controlled in order to meet
environmental quality standards. Because pulverized coal is used
as a fuel, coal dust must be suppressed when coal is loaded,
transported, or crushed. Also, the generation of steam requires
large quantities of fresh water for boiler makeup and condenser
cooling. Cooling tower blowdown has a high concentration of
dissolved solids and must be treated in order to prevent the
possibility of contamination of surrounding surface water with
inorganic salts. In addition, wastewater from the Plant's
sanitary system must be treated.
Major components of the project are as follows:
(A) Ash Handling System. A pneumatic system including
blowers, valves, pipes, storage silos, unloading facilities,
associated structural supports and controls to transfer and
store fly ash collected from the steam generator economizer
and precipitator hoppers of both Units 1 and 2. A high
pressure water sluicing system including pumps, valves, ash
grinder, pipes, dewatering tanks, unloading facilities,
associated structural supports, and controls to transfer and
store bottom ash from the steam generators of both Xxxxx 0
xxx 0.
(X) Xxxxxxxx Xxxxxx Reduction System. Windbox
modification to include overfire air ports to reduce NOx
formation by off stoichiometric combustion for Unit 2.
Windbox modification to include overfire air ports and duct
work, dampers, fan and motor for gas recirculation to reduce
NOx formation by reducing flame temperatures and diluting
combustion air for Unit 1.
(C) Electrostatic Precipitators. High efficiency
electrostatic precipitators for both Units 1 and 2, along
with associated structural supports and duct work, to remove
fly ash from flue gas exiting the steam boiler.
(D) Sulfur Oxide and Particulate Removal System.
Duplicate equipment is provided at both Units 1 and 2.
(1) Venturi scrubber-A variable throat venturi to
provide (i) backup fly ash removal to the electrostatic
precipitators and (ii) incidental sulfur oxide removal.
(2) Sulfur oxide absorber-Open, multi-stage,
spray chamber to contact a reagent solution with sulfur
oxide in the flue gas in order to chemically remove the
sulfur oxide.
(3) Demisting train-Cyclone separator followed by
a chevron demister and a mesh pad demister (i) to
remove fly ash from the flue gas in case of
precipitator upset and (ii) to prevent particle
reentrainment from the scrubber system itself by
physical entrapment of particulate matter.
(4) Reheat section-Oil burner and related duct
work to reheat flue gas in order to keep sulfur oxide
in a gaseous form to maintain operating reliability of
the Scrubber System and to provide additional plume
buoyancy.
(5) Calcium sulfate stabilization system-Primary
and secondary dewatering tanks, a mixing and
conditioning tank, reagent dispensing tanks, and
associated piping, conveyors, pumps, and other
equipment to chemically fix calcium sulfate residue.
(E) Dust Suppression System. Pipes, pumps, pipe
nozzles, tanks, and associated equipment to spray water over
coal transfer points in order to control the escape of coal
dust to the atmosphere.
(F) Wastewater Treatment System.
(1) Collecting basin-A two and one-half million
gallon soil cement pond to receive and settle
wastewater from steam boiler blowdown, cooling tower
blowdown, and sanitary waste treatment.
(2) Evaporator-Mechanical evaporator to remove
inorganic salts from process wastewater.
(3) Sanitary system-An extended aeration system
to treat sanitary wastes.
(4) Sewer system-Sewers, pipes, pumps, sumps, and
associated equipment necessary to interconnect the
various components of the Wastewater Treatment System.
