Exhibit 4(m)
==============================================================================
REFUNDING AGREEMENT
dated as of ________ __, 1995
among
FINANCIAL LEASING CORPORATION,
as Owner Participant
MERIDIAN TRUST COMPANY,
as Owner Trustee under Trust Agreement, dated as of
August 1, 1990, with the Owner Participant,
THE BANK OF NEW YORK,
as Indenture Trustee under Indenture of Mortgage
and Deed of Trust, dated as of August 1, 1990, as
supplemented, with the Owner Trustee,
and
THE UNITED ILLUMINATING COMPANY,
as Lessee
===========================================================================
Refunding of Initial Series Bonds issued in
connection with the Sale and Leaseback of an
Undivided Interest in Unit No. 1 of the
Seabrook Nuclear Power Plant
===========================================================================
This REFUNDING AGREEMENT, dated as of __________ __, 1995 ("Refunding
Agreement"), among FINANCIAL LEASING CORPORATION, a Massachusetts corporation
(the "Owner Participant"), MERIDIAN TRUST COMPANY, a Pennsylvania trust company,
not in its individual capacity, but solely as Owner Trustee under the Trust
Agreement, THE BANK OF NEW YORK, a New York banking corporation, not in its
individual capacity but solely as Indenture Trustee under the Indenture, and THE
UNITED ILLUMINATING COMPANY, a Connecticut corporation (the "Lessee"),
W I T N E S S E T H:
WHEREAS, the parties to this Refunding Agreement are parties to the
Participation Agreement, dated as of August 1, 1990 (the "Participation
Agreement"); and
WHEREAS, the Initial Series Bonds were issued by the Owner Trustee in
connection with the acquisition of the Undivided Interest; and
WHEREAS, Section 2(b) of the Participation Agreement provides for a
refunding of the Bonds theretofore issued and then Outstanding at the request of
the Lessee and upon the satisfaction of the conditions set forth in Sections 2
and 10(c) of the Participation Agreement and Section 2.05 of the Indenture; and
WHEREAS, the Lessee has requested such a refunding; and
WHEREAS, Section 3(e) of the Facility Lease provides for an adjustment
to Basic Rent and to the Value Schedules in the event of the issuance of
Refunding Bonds; and
WHEREAS, the Lessee and the Owner Participant have agreed for the
Owner Participant to make an additional equity investment and to cause the
refinancing of the Initial Series Bonds through the issuance of Refunding Bonds
and other Additional Bonds in amounts sufficient to redeem the Outstanding
Initial Series Bonds and finance transaction expenses associated therewith and
the premium thereon, and accordingly have agreed that the refunding contemplated
by this Agreement will require certain amendments to the Transaction Documents;
and
[WHEREAS, on __________ __, 1995, at the direction of the Lessee and
the Owner Participant, the Owner Trustee gave the Indenture Trustee notice of
the redemption of the Initial Series Bonds on __________, 1995 (the "Refunding
Date") and the Indenture Trustee gave notice of such redemption to the Holders
of such Bonds, which notice provided, in accordance with Section 5.05(c) of the
Indenture, that such redemption is conditional upon the receipt by the Indenture
Trustee, on or prior to the Refunding Date, of moneys sufficient to pay the
principal of, and the premium, if any, and interest on the Outstanding Bonds and
that if such moneys shall not have been so received, said notice shall be of no
force and effect and the Owner Trustee shall not be required to redeem the
Outstanding Bonds, on the Refunding Date; and]
WHEREAS, the parties hereto wish to cause the issuance of Refunding
Bonds and other Additional Bonds (the "199_ Bonds") in order to provide funds to
redeem the Outstanding Initial Series Bonds and to pay certain other costs
incurred in connection therewith, including a portion of the premium on such
Initial Series Bonds due on the Refunding Date; and
WHEREAS, the Lessee proposes to enter into a Underwriting Agreement
dated _______, 199_ (the "Refunding Underwriting Agreement"), with Xxxxxx
Xxxxxxx & Co. Incorporated and Citicorp Securities, Inc. (the "Refunding
Underwriters"); and
WHEREAS, in connection with the aforesaid, it will be necessary for
the Owner Participant, the Lessee, Meridian Trust Company, in its individual
capacity and as Owner Trustee, and The Bank of New York, in its individual
capacity and as Indenture Trustee, subject to the conditions set forth herein,
to enter into Amendment No. 1, dated as of _____________ __, 1995, to the
Participation Agreement ("PA Amendment No. 1"), to make certain amendments and
add certain provisions thereto; and
WHEREAS, Section 10.01 of the Indenture provides, among other things,
that the Owner Trustee and Indenture Trustee may, without consent of the Holders
of Outstanding Bonds, execute a supplement to the Indenture in order to evidence
the issuance of and to provide the terms of Additional Bonds; and
WHEREAS, subject to the conditions set forth herein, the Owner Trustee
and the Indenture Trustee will execute Supplemental Indenture No. 2 to the
Indenture, dated as of __________ __, 1995 ("Supplemental Indenture No. 2"),
providing for the issuance under the Indenture of 1995 Bonds as contemplated in
Supplemental Indenture No. 2; and
WHEREAS, Section 10.03 of the Indenture provides, among other things,
that, the Indenture Trustee may join in the execution of certain amendments to
the Participation Agreement, and that, upon receipt of a written instruction
from the Lessee and the Owner Trustee, the Indenture Trustee shall consent to
certain amendments of the Facility Lease; and
WHEREAS, subject to the conditions set forth herein, the Owner Trustee
and the Lessee will enter into Lease Supplement No. 1 to the Facility Lease,
dated as of __________ __, 1995 ("Lease Supplement No. 1"), to make certain
amendments to the Facility Lease; and
WHEREAS, subject to the conditions set forth herein, the Owner
Participant and the Lessee will enter into Amendment No. 1 dated as of
__________ __, 1995 to the Tax Indemnification Agreement ("TIA Amendment No.
1"), to amend certain provisions of the Tax Indemnification Agreement; and
WHEREAS, Basic Rent and the Value Schedules, as set forth in Lease
Supplement No. 1, will be adjusted to take into effect, among other things, the
additional Tax Assumptions set forth in TIA Amendment No. 1 and the additional
Pricing Assumptions set forth in Schedule 1 to PA Amendment No. 1;
NOW, THEREFORE, in consideration of the premises and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
- 2 -
SECTION 1. DEFINITIONS.
For purposes hereof, capitalized terms used herein and not otherwise
defined herein shall have the respective meanings assigned to such terms as set
forth in Appendix A to the Participation Agreement.
SECTION 2. Issuance of 199_ Bonds by Owner
TRUSTEE; APPLICATION OF PROCEEDS.
Subject to satisfaction or written waiver of the terms and conditions
hereof and of Sections 2 and 10(c) of the Participation Agreement and Section
2.05 of the Indenture, on the Refunding Date, (a)(i) the Lessee, the Owner
Participant, Meridian Trust Company, as Owner Trustee and The Bank of New York,
as Indenture Trustee, shall enter into PA Amendment No. 1, (ii) the Lessee and
the Lessor shall enter into Lease Supplement No. 1, (iii) the Owner Trustee and
the Indenture Trustee shall enter into Supplemental Indenture No. 2, and (iv)
the Lessee and the Owner Participant will enter into the TIA Amendment No. 1,
and the Owner Participant shall pay to the Owner Trustee an additional equity
investment in the amount of $[ ] (the "Additional Equity Investment"); the
Lessee shall pay to the Owner Trustee Supplemental Rent in the amount of $[ ]
and the Owner Trustee, on behalf of the Owner Participant, shall issue the 199_
Bonds in the principal amount of $___________ and apply the proceeds of the 199_
Bonds, the Additional Equity Investment and the Supplemental Rent to redeem the
Series 2006 Bonds for an amount equal to _______% of the principal amount
thereof, plus accrued interest thereon, to redeem the Series 2020 Bonds for an
amount equal to _______% of the principal amount thereof, plus accrued interest
thereon. The Owner Participant shall pay the Additional Equity Investment and
the Lessee shall pay the Supplemental Rent directly to a special account
established by the Owner Trustee with the Indenture Trustee. Upon receipt of the
proceeds of the 199_ Bonds from the Refunding Underwriters in accordance with
the Refunding Underwriting Agreement and the payments of the Owner Participant
and the Lessee described above, the Indenture Trustee on behalf of the Owner
Trustee shall (i) authenticate and deliver the 199_ Bonds of the series and in
the aggregate principal amount and registered as designated in the Refunding
Underwriting Agreement, and bearing interest at the rates per annum and in the
amounts, respectively, set forth in Supplemental Indenture No. 2 and (ii) apply
the proceeds of the 1995 Bonds and the payments of the Owner Participant and the
Lessee pursuant to clause (b) hereof to the redemption of the Series 2006 Bonds
and the Series 2020 Bonds.
SECTION 3. IMPLEMENTATION.
(a) FORMS. The forms of PA Amendment Xx. 0, Xxxxxxxxxxxx Xxxxxxxxx
No. 2, Lease Supplement No. 1 and TIA Amendment No. 1 are attached hereto as
Exhibits A, B, C and D, respectively.
(b) OBLIGATIONS OF THE OWNER PARTICIPANT. The Owner Participant
hereby directs the Owner Trustee to execute and deliver this Refunding Agreement
and the Refunding Underwriting Agreement and, subject to the terms and
conditions hereof and of Sections 2 and 10(c) of the Participation Agreement and
Section 2.05 of the Indenture, the Owner Participant hereby agrees that, on the
Refunding Date, it will execute and deliver TIA Amendment No. 1 and PA Amendment
No. 1
- 3 -
and make the payments described in Section 2(b) and will direct (i) the
Owner Trustee to execute and deliver PA Amendment Xx. 0, Xxxxxxxxxxxx Xxxxxxxxx
No. 2 and Lease Supplement No. 1 (collectively, with this Refunding Agreement
and TIA Amendment No. 1, the "Refunding Documents") in the forms of Exhibits A,
B and C hereto, respectively, (ii) the Owner Trustee to instruct the Indenture
Trustee to consent to Lease Supplement No. 1, (iii) the Owner Trustee to execute
199_ Bonds as contemplated by the Refunding Documents and the Refunding
Underwriting Agreement and to request the Indenture Trustee to authenticate and
deliver the 199_ Bonds pursuant to Section 2.05 of the Indenture and (iv) the
Owner Trustee to execute and deliver all other agreements, instruments and
certificates contemplated by the Transaction Documents, the Refunding
Underwriting Agreement and the Refunding Documents. The Owner Participant hereby
agrees for purposes of Section 7.01 of the Trust Agreement that actions taken
under the Refunding Documents, the Refunding Underwriting Agreement, and any
other instruments executed by the Owner Trustee pursuant to this Refunding
Agreement are actions under the Trust Agreement and are included within the
indemnity of the Owner Participant set forth in said Section 7.01 of the Trust
Agreement.
(c) INSTRUCTION AND CONSENT. Subject to satisfaction or written
waiver of the terms and conditions of Section 2(b) and 10(c) of the
Participation Agreement and Section 2.05 of the Indenture, (x) in accordance
with Section 10.03 of the Indenture, the Lessee and the Owner Trustee hereby
instruct the Indenture Trustee to consent, effective as of the Refunding Date,
to Lease Amendment No. 1 and the Indenture Trustee hereby so consents and (y) in
accordance with Sections 10.01 and 10.03 of the Indenture, the Owner Trustee and
the Indenture Trustee hereby consent and agree to execute and deliver PA
Amendment No. 1 and Supplemental Indenture No. 2 on the Refunding Date.
(d) CONSENT OF LESSEE. In accordance with Section 7(b)(2) of the
Participation Agreement, the Lessee hereby consents to the refunding of the
Outstanding Initial Series Bonds as contemplated hereby.
(e) RECORDATIONS AND FILINGS. The Lessee agrees that it will cause
to be made the recordations and filings set forth in Schedule 1 hereto on or
prior to the Refunding Date and represents that such filings and recordations
are all the recordations and filings that are necessary in order to preserve,
protect and perfect the Owner Trustee's right, title and interest in and to the
Undivided Interest and the Ground Lease Property and under the Facility Lease,
as amended by Lease Supplement No. 1, and the security interest of the Indenture
Trustee in the Indenture Estate under the Indenture, as amended by Supplemental
Indenture No. 2.
SECTION 4. CONDITIONS PRECEDENT.
(a) CONDITIONS PRECEDENT TO OBLIGATIONS OF OWNER PARTICIPANT AND
LESSEE. The obligations of the Owner Participant and the Lessee to take the
actions specified in Section 2 hereof on the Refunding Date shall be subject to
the following conditions precedent:
(i) each of the representations and warranties set forth in
Section 9(a)(1), (2), (3), (4), (5), (10), (11), (12), (19) and (20)
of the Participation Agreement shall be true and correct as of the
Refunding Date, provided that (a) all references therein
- 4 -
to Closing Date shall be deemed to mean the Refunding Date, (b) the
term Disclosure Documents shall be deemed to mean Lessee's latest
Annual Report on Form 10-K filed with the SEC and all documents
subsequently filed by the Lessee with the SEC pursuant to Section 13,
14 or 15(d) of the Securities Exchange Act prior to the date of the
execution and delivery of the Refunding Agreement, and (c) the
references in such clause (10) to March 31, 1990 shall be deemed to
mean the last day of the fiscal quarter for which the most recent
Quarterly Report on Form 10-Q has been filed with the SEC; and Lessee
shall have delivered a certificate to such effect to the Owner
Participant; and
(ii) each of the representations and warranties of the Owner
Participant set forth in Section 6(a)(1), (2), (3), (4) and (9) of the
Participation Agreement shall be true and correct as of the Refunding
Date, provided that all references therein to Closing Date shall be
deemed to mean the Refunding Date; and the Owner Participant shall
have delivered a certificate to such effect to the Lessee;
(iii) each of the representations and warranties of OT and Owner
Trustee set forth in Section 7(a)(1), (2), (3), (4), (5), (6), (7) and
(10) of the Participation Agreement shall be true and correct as of
the Refunding Date, provided that all references therein to Closing
Date shall be deemed to mean the Refunding Date; and the OT and Owner
Trustee shall have delivered a certificate to such effect to the Owner
Participant and the Lessee;
(iv) each of the representations and warranties of IT and the
Indenture Trustee set forth in Section 8(a) of the Participation
Agreement shall be true and correct as of the Refunding Date, provided
that all references therein to Closing Date shall be deemed to mean
the Refunding Date; and IT and the Indenture Trustee shall have
delivered a certificate to such effect to the Owner Participant and
the Lessee;
(v) the Refunding Underwriting Agreement shall have been
executed and delivered;
(vi) the Refunding Underwriters shall have purchased the 199_
Bonds pursuant to the Refunding Underwriting Agreement; and
(vii) the conditions set forth in Sections 2 and 10(c) of the
Participation Agreement shall have been satisfied or waived in
writing;
provided, however, that the obligations of the Lessee shall not be subject to
the conditions set forth in clause (i) above and the obligations of the Owner
Participant shall not be subject to the conditions set forth in clause (ii)
above.
(b) CONDITIONS PRECEDENT TO OBLIGATIONS OF THE OWNER TRUSTEE. The
obligations of the Owner Trustee to issue and deliver 199_ Bonds to the
Refunding Underwriters on the Refunding Date shall be subject to (x) the
simultaneous performance by the Refunding Underwriters of their
- 5 -
obligations under the Refunding Underwriting Agreement and the payment by the
Owner Participant and the Lessee of the amounts referred to in Section 2 hereof,
and (y) the satisfaction of the conditions set forth in Sections 2 and 10(c) of
the Participation Agreement and Section 2.05 of the Indenture to the
participation by the Owner Trustee in the transactions contemplated by this
Refunding Agreement.
(c) CONDITIONS PRECEDENT TO OBLIGATIONS OF THE INDENTURE TRUSTEE. The
obligations of the Indenture Trustee to take the action required by Section 2
hereof on the Refunding Date shall be subject to the satisfaction of the
conditions set forth in Section 2.05 of the Indenture.
SECTION 5. REFUNDING EXPENSES.
(a) REFUNDING EXPENSES. Subject to the provisions of this Section 5,
with funds provided by the Owner Participant, the Owner Trustee hereby agrees
that it will pay when due, or reimburse any Person who has previously paid the
following costs and expenses ("Refunding Expenses"):
(i) the reasonable legal fees and disbursements of the Owner
Participant's Special Counsel (not to exceed $100,000), the Owner
Participant's Tax Counsel (not to exceed $50,000), the Owner Trustee's
Counsel (New York and Pennsylvania) and the Indenture Trustee's
Counsel for their services rendered in connection with the execution
and delivery of this Refunding Agreement and the other Refunding
Documents;
(ii) all stenographic, printing, reproduction, and other
reasonable out-of-pocket expenses (other than investment banking or
brokerage fees) incurred in connection with the transactions
contemplated by the Refunding Documents and all other agreements,
documents or instruments prepared in connection therewith (including
all structuring computations and computerized lease analysis and
travel related costs);
(iii) all costs of issuance of the 199_ Bonds, including,
without limitation, the costs of preparing the Refunding Underwriting
Agreement, and all filing fees relating to any Registration Statement
for the 199_ Bonds and the fees, expenses and disbursements of the law
firms referred to in clause (i) above, and of counsel to the Refunding
Underwriters, rating agency fees and the fees and commissions of the
Refunding Underwriters;
(iv) all fees of the Owner Trustee and the Indenture Trustee in
connection with the review, execution and delivery of this Refunding
Agreement and the other Refunding Documents; and
- 6 -
(v) any other fees, expenses, disbursements and costs as the
Lessee and the Owner Participant shall have agreed are payable
pursuant to this Section 5(a).
Subject to the provisions of paragraphs (b) and (c) below, funds for
the payment of Refunding Expenses will be provided by the Owner Participant to
the Owner Trustee and the Owner Trustee will promptly disburse such funds upon
written authorization from the Owner Participant. The amount of Refunding
Expenses payable by the Owner Trustee shall not exceed $______________.
(b) PAYMENTS. Payments or reimbursements of Refunding Expenses shall
be made (i) on the Refunding Date to the extent invoiced and approved by the
Owner Participant on or prior to the Refunding Date, and (ii) to the extent not
previously paid pursuant hereto as promptly as practicable, and in any event not
later than 10 Business Days after being invoiced. Each party hereto shall use
its best efforts to prepare, and cause any Person acting for it to prepare, and
submit as soon as practicable and in any event not later than 30 days after the
Refunding Date any invoice of such Person in respect of Refunding Expenses.
Promptly after the payment of such Refunding Expenses, such adjustments to Basic
Rent and the Value Schedules as are required by Section 3(e)(ii) of the Facility
Lease shall be made.
(c) LESSEE'S INDEMNITY; FURTHER OBLIGATION. Notwithstanding anything
in this Section 5 to the contrary, in the event the transactions contemplated by
this Refunding Agreement shall not be consummated, the Lessee shall pay or cause
to be paid, and shall indemnify and hold harmless the Indenture Trustee, the
Owner Trustee and the Owner Participant with respect to all losses, costs and
expenses whatsoever incurred by them as a result of the pursuit of such
transactions, including, without limitation, all Refunding Expenses (which
shall, in such an instance, be deemed to include, without limitation, all
losses, costs and expenses whatsoever incurred by the Owner Participant pursuant
to this Agreement and Section 7.01 of the Trust Agreement) unless, in the case
of the Owner Participant, such failure to consummate shall result solely from
the Owner Participant's default in making its investment as contemplated in
Section 2(b) hereunder. Furthermore, in the event that the Refunding Expenses
shall exceed the funds available to the Owner Trustee pursuant to paragraph (a)
for the payment of Refunding Expenses, the Lessee shall pay or cause to be paid,
and shall indemnify and hold harmless the Indenture Trustee, the Owner Trustee
and the Owner Participant with respect to, all such excess Refunding Expenses.
SECTION 6. MISCELLANEOUS.
(a) EXECUTION. This Refunding Agreement may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each of which, when so executed and delivered, shall be an original, but all
such counterparts shall together constitute but one and the same instrument.
(b) GOVERNING LAW. This Refunding Agreement shall be governed by,
and be construed in accordance with, the laws of the State of New York.
- 7 -
(c) CONCERNING THE OWNER TRUSTEE. OT is entering into this Refunding
Agreement solely as Owner Trustee under the Trust Agreement and not in its
individual capacity. Anything herein to the contrary notwithstanding, all and
each of the agreements herein made on the part of the Owner Trustee are made and
intended not as personal agreements of OT but are made and intended for the
purpose of binding only the Trust Estate.
(d) CONCERNING THE INDENTURE TRUSTEE. IT is entering into this
Refunding Agreement solely as Indenture Trustee under the Indenture and not in
its individual capacity. Anything herein to the contrary notwithstanding, all
and each of the respective agreements herein made on the part of the Indenture
Trustee are made and intended not as personal agreements for IT, but are made
and intended solely as the agreements of the Indenture Trustee pursuant to the
Indenture, in the exercise of the powers and authority conferred and vested in
the Indenture Trustee pursuant to the Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Refunding
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized.
- 8 -
FINANCIAL LEASING CORPORATION,
as Owner Participant
By
--------------------------------
Name:
Title:
- 9 -
MERIDIAN TRUST COMPANY, not in its
individual capacity, but solely as
Owner Trustee under the Trust
Agreement
By
--------------------------------
Name:
Title:
- 10 -
THE BANK OF NEW YORK, not in its
individual capacity but solely as
Indenture Trustee
By
---------------------------------
Name:
Title:
- 11 -
THE UNITED ILLUMINATING COMPANY, as
Lessee
By
----------------------------------
Name:
Title:
- 12 -
SCHEDULE 1
RECORDATIONS AND FILINGS
Land Record Filings with Registry of Deeds, Rockingham County, New Hampshire
1. Amendment No. 1 to the Participation Agreement
2. Lease Supplement No. 1 to the Facility Lease
3. Supplemental Indenture No. 2 to the Indenture
EXHIBIT A
================================================================================
AMENDMENT NO. 1
dated as of ________ __, 1995
to
PARTICIPATION AGREEMENT
among
FINANCIAL LEASING CORPORATION,
as Owner Participant
MERIDIAN TRUST COMPANY,
as Owner Trustee under Trust Agreement, dated as of
August 1, 1990, with the Owner Participant,
THE BANK OF NEW YORK,
as Indenture Trustee under Indenture of Mortgage
and Deed of Trust, dated as of August 1, 1990, as
supplemented, with the Owner Trustee,
and
THE UNITED ILLUMINATING COMPANY,
as Lessee
================================================================================
Refunding of Initial Series Bonds issued in
connection with the Sale and Leaseback of an
Undivided Interest in Unit No. 1 of the
Seabrook Nuclear Power Plant
================================================================================
This AMENDMENT NO. 1, dated as of __________ __, 1995 to
PARTICIPATION AGREEMENT ("PA Amendment No. 1"), among FINANCIAL LEASING
CORPORATION, a Massachusetts corporation (the "Owner Participant"), MERIDIAN
TRUST COMPANY, a Pennsylvania trust company, not in its individual capacity, but
solely as Owner Trustee under the Trust Agreement, THE BANK OF NEW YORK, a New
York banking corporation, not in its individual capacity but solely as Indenture
Trustee under the Indenture, and THE UNITED ILLUMINATING COMPANY, a Connecticut
corporation (the "Lessee"),
W I T N E S S E T H:
WHEREAS, the parties to this PA Amendment No. 1 are parties to
the Participation Agreement, dated as of August 1, 1990 (the "Participation
Agreement"); and
WHEREAS, the Initial Series Bonds were issued by the Owner
Trustee in connection with the acquisition of the Undivided Interest; and
WHEREAS, Section 2(b) of the Participation Agreement provides
for a refunding of the Bonds theretofore issued and then Outstanding upon the
satisfaction of the conditions set forth in Sections 2 and 10(c) of the
Participation Agreement and Section 2.05 of the Indenture; and
WHEREAS, the Lessee, the Lessor, the Owner Participant, the
Owner Trustee and the Indenture Trustee have entered into Refunding Agreement,
dated as of _______ __, 199_, providing for the issuance by the Owner Trustee of
Additional Bonds, including Refunding Bonds, to provide funds to redeem the
Outstanding Initial Series Bonds and to pay certain other costs incurred in
connection therewith; and
WHEREAS, the Lessee and the Owner Participant have agreed for
the Owner Participant to make an additional equity investment and to cause the
refinancing of the Initial Series Bonds through the issuance of Additional Bonds
in amounts sufficient to finance transaction expenses associated with the
refinancing and a portion of premium on the Refunded Bonds, and accordingly have
agreed that the refunding contemplated by the Refunding Agreement will require
certain amendments to the Transaction Documents; and
WHEREAS, Basic Rent and the Value Schedules, as set forth in
Lease Supplement No. 2, have been adjusted to take into effect, among other
things, the additional Tax Assumptions set forth on TIA Amendment No. 1 and the
additional Pricing Assumptions set forth on Schedule 1 hereto;
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS.
For purposes hereof, capitalized terms used herein and not
otherwise defined herein shall have the respective meanings assigned to such
terms as set forth in Appendix A to the Participation Agreement.
SECTION 2. AMENDMENTS.
(a) Schedule 5 to the Participation Agreement is hereby amended
to include the additional Pricing Assumptions set forth on Schedule 1 hereof.
(b) Section 9(b)(3)(iv) of the Participation Agreement shall be
amended by deleting the text thereof in its entirety and substituting in lieu
thereof the following:
(iv) BONDS. The Lessee will not, nor will it
permit any of its Affiliates to, acquire any of the Bonds
without the written consent of the Owner Participant; PROVIDED,
HOWEVER, that the Lessee may purchase Bonds without such consent
so long as (A) the amount of Bonds held at any time by the
Lessee (and any Affiliates) does not exceed 25% in aggregate
principal amount of the Bonds Outstanding, (B) no such Bonds are
so acquired prior to 18 months following the date of the initial
authentication and delivery of the 1995 Bonds (as defined in the
Indenture), and (C) the Lessee shall have notified the Indenture
Trustee that it holds such Bonds so that, in determining whether
or not the Holders of the requisite principal amount of the
Bonds Outstanding under the Indenture, or the Outstanding Bonds
of any series, have given any request, demand, authorization,
direction, notice, consent or waiver under the Indenture or
whether or not a quorum is present at a meeting of Holders, such
Bonds be disregarded and deemed not Outstanding.
(c) Section 12(a) thereof is amended by (i) inserting the words
"or Refunding Expenses" immediately after the words "Transaction Expenses" and
immediately before "or included" on the thirteenth line of page 34; (ii) insert
the words "or Refunding Expenses" immediately after the words "Transaction
Expenses" and immediately before ", the reasonable fees" on the fourteenth line
of page 34; and (iii) insert the words "or Refunding Expenses to be paid by the
Owner Trustee pursuant to PA Amendment No. 1" in (3) immediately after the words
"Section 13(a)" and immediately before the words ", (4) for any".
(d) Section 12(b)(2) (xi) therefore is amended by inserting the
words "or Refunding Expenses" immediately after the words "Transaction Expenses"
and immediately before the semi-colon.
(e) Appendix A to the Participation Agreement is hereby amended
by adding the following definitions thereto:
REFUNDING AGREEMENT shall mean the Refunding Agreement,
dated as of _______, 199_, among the Owner Participant, the Owner Trustee, the
Indenture Trustee and the Lessee.
-2 -
REFUNDING EXPENSES shall have the meaning set forth in
the Refunding Agreement.
(f) The definition of Net Economic Return set forth in Appendix
A is hereby amended in its entirety to be as follows:
NET ECONOMIC RETURN shall mean:
(i) the net after-tax economic yield expected by the Owner
Participant as of the date of the initial authentication and delivery of the
199_ Bonds (as defined in the Indenture) with respect to the Undivided Interest,
calculated using the Assumptions and the computations of Basic Rent, Casualty
Values and Special Casualty Values derived therefrom (the"SCHEDULES AND
ASSUMPTIONS") as such yield shall be adjusted pursuant to and in accordance with
Section 3 of the Facility Lease and as agreed between the Lessee and the Owner
Participant; and
(ii)(a) until June 30, 2001 and thereafter if the License
Extension is granted by such date, the sum of after-tax cash flow over the Basic
Lease Term at least equal to that expected by the Owner Participant as of the
date of the initial authentication and delivery of the 199_ Bonds (as defined in
the Indenture) calculated using the Schedules and Assumptions (the "ORIGINAL
AFTER-TAX CASH FLOW") or (b) after June 20, 2001 if the License Extension is not
granted by such date, the product of the Original After-Tax Cash Flow multiplied
by a fraction (I) the numerator of which is the number of months in the Basic
Lease Term (assuming the License Extension is not granted) and (II) the
denominator of which is the number of months in the Basic Lease Term (assuming
the License Extension is granted); and
(iii) the same general pattern of after-tax Earnings originally
expected by the Owner Participant as of the date of the initial authentication
and delivery of the 199_ Bonds (as defined in the Indenture) calculated using
the Schedules and Assumptions.
Notwithstanding the above, nothing in this definition shall be construed
to obligate the Lessee to restore any portion of a reduction in Earnings where
such portion of the reduction is due to events other than changes in Basic Rent
provided for in the Transaction Documents, including, by example, changes in
Financial Accounting Standards Board Statement No. 13 occurring after the date
of the initial authentication and delivery of the 199_ Bonds (as defined in the
Indenture).
- 3-
For the purposes of this definition, the Assumptions shall be deemed to
include the assumptions that (i) the Owner Participant is fully taxable during
the entire Basic Lease Term (PROVIDED, HOWEVER, that nothing in this definition
or the Participation Agreement shall be construed to be a representation by the
Owner Participant as to the actual residual value assumed by the Owner
Participant for purposes of calculating its earnings according to Financial
Accounting Standards Board Statement No. 13 accounting or for any other purpose)
and (ii) none of the Investment is comprised of borrowed funds.
(g) The definition of Transaction Documents set forth in
Appendix A is hereby amended by adding after the word "Bonds" the words "and the
Refunding Agreement".
SECTION 3. MISCELLANEOUS.
(a) EXECUTION. This PA Amendment No. 1 may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each of which, when so executed and delivered, shall be an original, but all
such counterparts shall together constitute but one and the same instrument.
(b) GOVERNING LAW. This PA Amendment No. 1 shall be governed
by, and be construed in accordance with, the laws of the State of New York.
(c) CONCERNING THE OWNER TRUSTEE. OT is entering into this PA
Amendment No. 1 solely as Owner Trustee under the Trust Agreement and not in its
individual capacity. Anything herein to the contrary notwithstanding, all and
each of the agreements herein made on the part of the Owner Trustee are made and
intended not as personal agreements of OT but are made and intended for the
purpose of binding only the Trust Estate.
(d) CONCERNING THE INDENTURE TRUSTEE. IT is entering into this
PA Amendment No. 1 solely as Indenture Trustee under the Indenture and not in
its individual capacity. Anything herein to the contrary notwithstanding, all
and each of the respective agreements herein made on the part of the Indenture
Trustee are made and intended not as personal agreements for IT, but are made
and intended solely as the agreements of the Indenture Trustee pursuant to the
Indenture, in the exercise of the powers and authority conferred and vested in
the Indenture Trustee pursuant to the Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this PA
Amendment No. 1 to be duly executed by their respective officers thereunto duly
authorized.
- 4 -
FINANCIAL LEASING CORPORATION,
as Owner Participant
By
___________________________
Name:
Title:
- 5 -
MERIDIAN TRUST COMPANY, not in its individual
capacity, but solely as Owner Trustee under
the Trust Agreement
By
____________________________________
Name:
Title:
- 6 -
THE BANK OF NEW YORK, not in its individual
capacity but solely as Indenture Trustee
By
_____________________________________
Name:
Title:
- 7 -
THE UNITED ILLUMINATING COMPANY, as
Lessee
By
__________________________________
Name:
Title:
- 8 -
SCHEDULE 1
PRICING ASSUMPTIONS
Basic Rent, Casualty Values and Special Casualty Values, as set forth in the
Facility Lease, as amended by Supplement No. 2, dated as of , 199 , for dates
occurring after the Refunding Date set forth below, have been computed on the
basis of the following pricing assumptions which hereby supplement and amend
Schedule 5 to the Participation Agreement:
1. Refunding Date: _________, 199_.
2. Interest Rate and Amortization of 199_ Bonds:
See Supplemental Indenture No. 2, dated as of _______, 199_
3. Refunding Expenses: $_____ paid by the Owner
Trustee on the Refunding Date (amortized on a straight-line basis during the
period commencing on the Refunding Date and ending on the last day of the Basic
Lease Term).
4. Accrued Interest: $_____ paid by the Owner
Trustee on the Refunding Date as interest from _________, 199_ to the Refunding
Date on the Initial Series Bonds which are redeemed on the Refunding Date.
5. Premium: $_____ paid by the Owner
Trustee on the Refunding Date in respect of the premium on the Initial Series
Bonds redeemed on the Refunding Date.
6. 199_ Bonds: $_____ issued by the Owner
Trustee in accordance with the Refunding Agreement, the Supplemental Indenture
No. 2, dated as of _______, 199_, and other Transaction Documents and not in
excess of 105% of the outstanding principal amount of the Initial Series Bonds
as of the Refunding Date.
7. Additional Equity
Investment: $_____ funded by the Owner
Trustee or the Owner Participant, as the case may be, on the Refunding Date.
8. Supplemental Rent: $_____ paid by the Lessee
on the Refunding Date.
- 9 -
9. Owner Participant's
Marginal State Tax Rate(s): 9.5281%; 9%, beginning in
fiscal year 1991.
10. Owner Participant's Marginal
Federal Tax Rate(s): 34%; 35%, beginning in
fiscal year 1991.
11. Tax Payment Method(s): 90/10;
93/7, beginning in fiscal year 1992;
97/3, beginning in fiscal year 1993;
100/0, beginning in fiscal year 1994.
- 10 -
EXHIBIT B
==============================================================================
SUPPLEMENTAL INDENTURE NO. 2
dated as of _______, 1995
to the
INDENTURE OF MORTGAGE AND DEED OF TRUST
dated as of August 1, 1990
among
MERIDIAN TRUST COMPANY,
not in its individual capacity,
but solely as Owner Trustee under the Trust Agreement,
THE UNITED ILLUMINATING COMPANY
and
THE BANK OF NEW YORK,
as Indenture Trustee
=============================================================================
Issuance of Bonds in connection with
the Lease of an Undivided Interest in
Unit No. 1 of the Seabrook Nuclear Power Plant
=============================================================================
This SUPPLEMENTAL INDENTURE NO. 2, dated as of _______, 1995, to the
INDENTURE OF MORTGAGE AND DEED OF TRUST, dated as of August 1, 1990 (such
instrument being herein called the "ORIGINAL INDENTURE," and the Original
Indenture, as previously supplemented by the Supplemental Indenture and as
supplemented by this Supplemental Indenture No. 2 and as it may be further
supplemented from time to time by all other indentures supplemental thereto,
being herein called the "INDENTURE"), among MERIDIAN TRUST COMPANY, a
Pennsylvania trust company having its principal office and mailing address at 00
Xxxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxx 00000, not in its individual capacity,
except as otherwise expressly provided in the Indenture, but solely as trustee
(the "OWNER TRUSTEE") under the Trust Agreement (such term and all other
capitalized terms used herein and not defined herein having the meanings
ascribed thereto in Appendix A to the Original Indenture), THE UNITED
ILLUMINATING COMPANY, a Connecticut corporation having its principal office and
mailing address at 00 Xxxxxx Xxxxxx, Xxx Xxxxx, Xxxxxxxxxxx 00000 (the
"LESSEE"), and THE BANK OF NEW YORK, a New York banking corporation having its
principal corporate trust office at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "INDENTURE TRUSTEE"),
W I T N E S S E T H:
WHEREAS, the Owner Trustee and the Lessee have executed and delivered to
the Indenture Trustee the Original Indenture providing, among other things, for
the issuance from time to time of Bonds of one or more series;
WHEREAS, Section 10.01 of the Original Indenture provides, among other
things, that the Lessee and Owner Trustee, at any time and from time to time,
may enter into one or more indentures supplemental to the Original Indenture for
the purpose of, among other things, establishing the form and terms of Bonds of
any series permitted by Sections 2.01 and 2.04 of the Original Indenture;
WHEREAS, in order to finance a portion of the Purchase Price of the
Undivided Interest, the Owner Trustee issued the Initial Series Bonds in two
series as provided in the Supplemental Indenture;
[WHEREAS, on _________, 1995, at the direction of the Lessee and the Owner
Participant, the Owner Trustee gave the Indenture Trustee notice of the
redemption of the Initial Series Bonds on __________, 199_ (the "First Refunding
Date") and the Indenture Trustee gave notice of such redemption to the Holders
of such Bonds, which notice provided, in accordance with Section 5.05 of the
Original Indenture, that such redemption is conditional upon the receipt by the
Indenture Trustee on or prior to the First Refunding Date, of moneys sufficient
to pay the principal of, and the premium, if any, and interest on the
Outstanding Bonds and that if such moneys shall not have been so received, said
notice shall be of no force and effect and the Owner Trustee shall not be
required to redeem the Outstanding Bonds on the First Refunding Date];
WHEREAS, in order to provide funds to so redeem the Initial Series Bonds
on the First Refunding Date and to pay certain other costs incurred in
connection therewith, the Owner Trustee and the Lessee (x) desire the issuance
by the Owner Trustee of Additional Bonds in [two] series to be designated as
hereinafter provided and (y) have requested the Indenture Trustee to enter into
this Supplemental Indenture No. 2 for the purpose of establishing the form and
terms of the Bonds of such series;
WHEREAS, all action on the part of the Owner Trustee and the Lessee
necessary to authorize the execution and delivery of this Supplemental Indenture
No. 2 and the issuance of the aforesaid 199__ Bonds has been duly taken; and
WHEREAS, all acts and things necessary (x) to make the Bonds of the series
herein created and established, when executed by the Owner Trustee and
authenticated and delivered by the Indenture Trustee as provided in the Original
Indenture, the legal, valid, and binding obligations of the Owner Trustee and
(y) to constitute these presents a valid and binding supplemental indenture and
agreement according to its terms have been done and performed, and the execution
of this Supplemental Indenture No. 2 and the creation and issuance under the
Original Indenture of such Bonds have in all respects been duly authorized.
NOW, THEREFORE, in order to establish the form and terms, and to authorize
the authentication and delivery, of the Bonds of the series herein created and
established, and in consideration of the premises, of the purchase of such Bonds
by the Holders thereof and of other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Owner Trustee and the
Lessee each covenant and agree with the Indenture Trustee, for the equal and
proportionate benefit of the respective Holders from time to time of the Bonds,
as follows:
ARTICLE ONE
The 199_ Bonds
SECTION 1.01. TERMS OF THE BONDS.
There are hereby created and established two separate series of Bonds
designated, respectively, "SEABROOK 1 SECURED LEASE OBLIGATION BONDS, ___%
SERIES DUE ___________" (hereinafter sometimes called the "SERIES [A] BONDS")
and "SEABROOK 1 SECURED LEASE OBLIGATION BONDS, ____% SERIES DUE _______"
(hereinafter sometimes called the "SERIES [B] BONDS"). The Series [A] Bonds and
the Series [B] Bonds are hereinafter sometimes referred to, collectively, as the
"199__ BONDS". The 199__ Bonds of each series shall be issued in the aggregate
principal amounts, shall bear interest at the rates per annum and shall have the
Stated Maturities of principal set forth below:
ORIGINAL
PRINCIPAL INTEREST STATED
AMOUNT RATE MATURITY
--------- -------- --------
Series [A] Bonds . . . . . $ %
Series [B] Bonds . . . . . $
---------
$
The Series [A] Bonds and the Series [B] Bonds shall be substantially in
the form of Exhibit A hereto. The interest on the 199__ Bonds of each series
shall be due and payable as and from the most recent interest payment date to
which interest has been paid or duly provided for or, with
- 2 -
respect to any 199__ Bond issued prior to the first interest payment date, the
date of original issuance thereof, semiannually on January 2 and July 2 in each
year, commencing ____________, 1996, until the principal amount of the Bonds of
such series has been paid in full or duly provided for. Payment of the principal
of and premium, if any, and interest on each 199__ Bond shall be made to the
Holder thereof upon presentation and surrender thereof at the corporate trust
office of any Paying Agent, except that payments of interest and Installment
Payment Amounts on such Bond, other than such amounts payable on the Stated
Maturity thereof, shall be made without presentation or surrender thereof, by
check drawn upon the Paying Agent and mailed to the address of the Holder of
such Bond as such address shall appear in the Bond Register and except that if
such Holder shall be a securities depositary, such payment may be made by such
other means in lieu of check as shall be agreed upon by the Owner Trustee, the
Lessee, the Indenture Trustee and such Holder.
SECTION 1.02. INSTALLMENT PAYMENTS OF PRINCIPAL
(a) INSTALLMENT PAYMENTS. On each Installment Payment Date set forth
below, the Owner Trustee shall pay an installment of principal of each 199__
Bond of each series equal in amount to the Installment Payment Percentage set
forth below for such Installment Payment Date multiplied by the Original
Principal Amount (as hereinafter defined) of such Bond. "Original Principal
Amount," when used with respect to the 199__ Bonds of either series, means the
principal amount identified as such on the face of such Bond.
- 3 -
Installment Installment Payment Percentage
Payment Date -------------------------------
------------ Series [A] Series [B]
Bonds Bonds
---------- ----------
(a) CERTAIN ADJUSTMENTS TO INSTALLMENT PAYMENTS. (1) The principal
amount of 199__ Bonds of either series to be paid in installments on the
Installment Payment Dates and Stated Maturity for such series may be adjusted
(an "INSTALLMENT PAYMENT ADJUSTMENT") at the discretion of the Owner Trustee,
under the circumstances and subject to the conditions set forth in Section 2(c)
of the Participation Agreement; PROVIDED, HOWEVER, that no Installment Payment
Adjustment shall be made
- 4 -
by the Owner Trustee which shall (x) cause the average life of the 199__ Bonds
of either series (measured from the date of initial issuance thereof and
calculated in accordance with generally accepted financial practice) to be
increased or decreased by more than six months, except in the case of such an
adjustment occasioned by failure of the Lessee to obtain the License Extension,
in which case no Installment Payment Adjustment shall cause the average life of
the 199__ Bonds of either series (measured as aforesaid) to be decreased by more
than twenty-four months and in which case, such Installment Payment Adjustment
shall result in the final payment or redemption of the 199__ Bonds of such
series being scheduled to occur no later than the last day of the Basic Lease
Term, or (y) extend the Stated Maturity of Principal of the 199__ Bonds of
either series. In the event it elects to make an Installment Payment Adjustment,
the Owner Trustee shall deliver to the Indenture Trustee and the Lessee, at
least 45 days prior to the first Installment Payment Date proposed to be
effected by such adjustment, an Owner Trustee Request, prepared by the Owner
Participant and the Lessee, (A) stating that the Owner Trustee has elected to
make an Installment Payment Adjustment as contemplated in this subsection, (B)
setting forth a revised Installment Payment Percentage schedule applicable to
the 199__ Bonds of each series with respect to which an Installment Payment
Adjustment is to be made, and (C) attaching thereto calculations showing that
(i) the average life of the 199__ Bonds of the affected series shall not be
decreased or increased except as permitted by this subsection (b) and (ii) the
Stated Maturity of principal of the 199__ Bonds of the affected series shall not
be extended as a result of such adjustment. The Indenture Trustee may rely on
such Owner Trustee Request and shall have no duty with respect to the
calculations referred to in the foregoing clause (C), other than to make them
available for inspection upon reasonable notice by any Holder at the Corporate
Trust Office. The Indenture Trustee shall send to each Holder of 199__ Bonds of
the series in respect of which an Installment Payment Adjustment has been made,
in the manner provided in Section 1.06 of the Original Indenture and at least 30
days before the first Installment Payment Date to be affected thereby, a revised
schedule giving effect to such Installment Payment Adjustment.
(2) In the event that there shall have been any partial redemption
of the Bonds of either series (other than pursuant to principal installment
payments), each Installment Payment Amount for each 199__ Bond of a series
subsequent to such redemption shall be reduced by an amount equal to the amount
obtained by multiplying such Installment Payment Amount as in effect prior to
such redemption by a fraction of which the numerator shall be the aggregate
principal amount of 199__ Bonds of such series redeemed pursuant to such partial
redemption, and the denominator shall be the aggregate unpaid principal amount
of 199__ Bonds of such series Outstanding immediately prior to such redemption.
SECTION 1.03. OTHER REDEMPTION.
The 199__ Bonds of each series shall be subject to redemption, at the
option of the Owner Trustee, in whole at any time or in part from time to time,
at the Redemption Price of 100% of the unpaid principal amount of the 199__
Bonds of each series to be so redeemed, plus accrued interest, if any, thereon
to the Redemption Date, plus, if such redemption is made prior to the applicable
Premium Termination Date, the Make-Whole Premium, if any. "Make-Whole Premium"
shall mean, with respect to the principal amount of any 199__ Bond to be
redeemed on any Redemption Date, the amount which the Investment Banker
determines as of the third Business Day prior to such Redemption Date to equal
the product obtained by multiplying (a) the excess, if any, of (i) the sum of
the present values of all the remaining scheduled payments of principal and
interest from the Redemption Date to maturity of such 199_ Bond, computed on a
semi-annual basis by discounting such payments on each January 2 and July 2 at a
rate equal to the Treasury Rate, based on a 360-day
- 5 -
year of twelve 30-day months, over (ii) the aggregate unpaid principal amount of
such 199__ Bond plus any accrued but unpaid interest thereon by (b) a fraction
the numerator of which shall be the principal amount of such 199_ Bond to be
redeemed on such Redemption Date and the denominator of which shall be the
aggregate unpaid principal amount of such 199__ Bond; provided that the
aggregate unpaid principal amount of such 199__ Bond for the purpose of clauses
(a)(ii) and (b) of this definition shall be determined after deducting the
principal installment, if any, due on such Redemption Date. "Premium Termination
Date" means _________ for a Series [A] Bond and _______ for a Series [B] Bond.
"Investment Banker" shall mean an independent investment banking institution of
national standing appointed by Lessee or, if the Indenture Trustee does not
receive notice of such appointment at least ten days prior to a scheduled
Redemption Date or if an Event of Default under the Facility Lease shall have
occurred and be continuing, appointed by the Owner Trustee. "Treasury Rate"
shall mean, with respect to each 199_ Bond to be redeemed, a per annum rate
(expressed as a semiannual equivalent and as a decimal and, in the case of
United States Treasury bills, converted to a bond equivalent yield) determined
to be the per annum rate equal to the semiannual yield to maturity of United
States Treasury securities maturing on the Average Life Date of such 199__ Bond,
as determined by interpolation between the most recent weekly average yields to
maturity for two series of United States Treasury securities (A) one maturing as
close as possible to, but earlier than, the Average Life Date of such 199__ Bond
and (B) the other maturing as close as possible to, but later than, the Average
Life Date of such 199__ Bond, in each case as published in the most recent
H.15(519) (or, if a weekly average yield to maturity for United States Treasury
securities maturing on the Average Life Date of such 199__ Bond is reported in
the most recent H.15(519), as published in H.15(519)). H.15(519) means
"Statistical Release H.15(519), Selected Interest Rates," or any successor
publication, published by the Board of Governors of the Federal Reserve System.
The most recent H.15(519) means the latest H.15(519) which is published prior to
the close of business on the third business day prior to the applicable
Redemption Date. "Average Life Date" shall mean, with respect to any 199__ Bond
to be redeemed, the date which follows the redemption date by a period equal to
the Remaining Weighted Average Life of such 1995 Bond. "Remaining Weighted
Average Life" shall mean, with respect to any 199_ Bond to be redeemed, the
number of days equal to the quotient obtained by dividing (A) the sum of the
products obtained by multiplying (1) the amount of each remaining principal
payment on such 199__ Bond by (2) the number of days from and including the
redemption date, to but excluding the scheduled payment date of such principal
payment by (B) the unpaid principal amount of such 199__ Bond.
SECTION 1.04 SELECTION BY INDENTURE TRUSTEE OF BONDS TO BE
REDEEMED.
Anything to the contrary in Section 5.04(a) of the Original Indenture
notwithstanding, if fewer than all of the 199__ Bonds of either series are to be
redeemed, the particular Bonds of such series to be redeemed shall be selected
not more than 45 days prior to the Redemption Date by the Indenture Trustee by
prorating, as nearly as practicable, the principal amount of such Bonds to be
redeemed among the Holders of such Bonds.
SECTION 1.05 SINKING FUND REDEMPTION. There shall be no Sinking Fund for the
retirement of the 199__ Bonds of either series.
- 6-
ARTICLE TWO
AMENDMENT OF INDENTURE
SECTION 2.01. AMENDMENTS.
(a) Appendix A to the Indenture is hereby amended by adding the
following definitions thereto:
"AMORTIZING BONDS," shall mean any Bond the principal of which is
payable in installments on an Installment Payment Date.
"INSTALLMENT PAYMENT AMOUNT," when used with respect to any Bond the
principal of which is payable in installments means the amount of the
installment payment of principal due and payable on each Installment
Payment Date other than the Stated Maturity date thereof.
"Installment Payment Date," when used with respect to any Bond the
principal of which is payable in installments means each date on which an
installment payment of principal is due and payable on such Bond, as set
forth in the Series Supplemental Indenture creating the Bonds of such
series.
(b) Appendix A to the Indenture is hereby further amended by deleting
the definitions "Regular Record Date," "Special Record Date" and "Stated
Maturity" in their entirety and substituting in lieu thereof the following:
"REGULAR RECORD DATE" for the Stated Maturity of any installment of
interest on the Bonds of any series or for the Installment Payment Date of
any installment of principal of the Bonds and any series for which
principal is payable from time to time without presentation or surrender
means the 15th day (whether or not a Business Day) of the month
immediately preceding the month in which such Stated Maturity or
Installment Payment Date, as the case may be, occurs, or any other date
specified for such purpose in the Series Supplemental Indenture setting
forth the terms of the Bonds of such series.
"SPECIAL RECORD DATE" for the payment of any defaulted interest or
any defaulted Installment Payment Amount means a date fixed by the
Indenture Trustee pursuant to Section 2.11 of the Indenture.
"STATED MATURITY," when used with respect to the principal of any
Bond or any installment of interest thereon, means the date specified in
such Bond as the fixed date on which such principal or such installment of
interest is due and payable; provided, however, that, with respect to any
Bond the principal of which is payable in installments without presentment
or surrender, Stated Maturity shall mean the date specified in such Bond
as the fixed date on which the final payment of such Bond is due and
payable.
(c) Section 1.13 of the Original Indenture is hereby amended by deleting
such section in its entirety and substituting in lieu thereof the following:
- 7 -
SECTION 1.13. LEGAL HOLIDAYS. In any case where any Redemption
Date, Installment Payment Date or the Stated Maturity of principal of or
any installment of interest on any Bond, or any date on which any
defaulted interest or principal is proposed to be paid, shall not be a
Business Day, then (any provision of this Indenture or of such Bond to the
contrary notwithstanding) payment of interest or principal, or both, and
premium, if any, shall be made on the next succeeding Business Day with
the same force and effect as if made on or at such nominal Redemption
Date, Installment Payment Date, Stated Maturity or date on which such
defaulted interest or principal was proposed to have been paid, and no
interest shall accrue on the amount so payable for the period from and
after such Redemption Date, Installment Payment Date, Stated Maturity or
date for the payment of defaulted interest or principal, as the case may
be, to such next succeeding Business Day.
(d) Section 2.11 of the Original Indenture is hereby amended by deleting
such section in its entirety and substituting in lieu thereof the following:
SECTION 2.11. PAYMENT OF INTEREST, ETC.; INTEREST RIGHTS PRESERVED.
(a) Any Installment Payment Amount, or interest on any Bond which is
payable, and is punctually paid or duly provided for, at any Installment
Payment Date or any Stated Maturity of an installment of interest shall be
paid to the Person in whose name that Bond (or one or more Predecessor
Bonds) is registered at the close of business on the Regular Record Date
for such interest. Payment of interest on any Bond shall be made by check
drawn upon the Paying Agent and mailed to the address of the Holder
entitled thereto as such address shall appear in the Bond Register or in
such other manner as shall be established in the Series Supplemental
Indenture creating the series of which such Bond is a part. Payment of the
principal of and premium, if any, on any Bond shall be made to the Holder
of such Bond upon presentation and surrender thereof at the office or
agency maintained for such purpose pursuant to Section 4.04 or in such
other manner as shall be established in the Series Supplemental Indenture
creating the series of which such Bond is a part. Payment as aforesaid
shall be made in such coin or currency of the United States of America as,
at the time of payment, is legal tender for the payment of public and
private debts.
(b) Any Installment Payment Amount or any interest on any Bond of
any series which is payable, but is not punctually paid or duly provided
for, at any Installment Payment Date or any Stated Maturity of an
installment of interest shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder,
to the extent that the Owner Trustee has elected to pay such defaulted
interest or principal as provided in subparagraph (1) or (2) below:
(1) The Owner Trustee may elect to make payment of any
defaulted interest or principal to the Persons in whose names the
Bonds of such series in respect of which interest is in default (or
their respective Predecessor Bonds) are registered at the close of
business on a Special Record Date for the payment of such defaulted
interest or principal, which shall be fixed in the following manner.
The Owner Trustee shall notify the Indenture Trustee and, if other
than the Indenture Trustee, the Paying Agent, in writing of the
amount of defaulted interest or principal proposed to be paid on
each such Bond and the date of the proposed payment (which date
shall be such as to enable the Indenture Trustee to comply with the
next sentence hereof), and at the same time there shall be deposited
with the Indenture Trustee an amount of
- 8 -
money equal to the aggregate amount proposed to be paid in respect
of such defaulted interest or principal or there shall be made
arrangements satisfactory to the Indenture Trustee for such deposit
prior to the date of the proposed payment, such money when deposited
to be held in trust for the benefit of the Persons entitled to such
defaulted interest or principal as in this subparagraph provided and
not as part of the Indenture Estate. Thereupon the Indenture Trustee
shall fix a Special Record Date for the payment of such defaulted
interest or principal, which shall be not more than 15 nor less than
10 days prior to the date of the proposed payment and not less than
10 days after the receipt by the Indenture Trustee of the notice of
the proposed payment. The Indenture Trustee shall promptly notify
the Owner Trustee, the Lessee and, if other than the Indenture
Trustee, the Bond Registrar of such Special Record Date and, in the
name and at the expense of the Owner Trustee, shall give notice of
the proposed payment of such defaulted interest or principal and the
Special Record Date therefor to each Holder of such series in the
manner provided in Section 1.06, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such
defaulted interest or principal and the Special Record Date therefor
having been given as aforesaid, such defaulted interest or principal
shall be paid to the Persons in whose names the Bonds of such series
(or their respective Predecessor Bonds) are registered at the close
of business on such Special Record Date and shall no longer be
payable pursuant to the following subparagraph (2).
(2) The Owner Trustee may make, or cause to be made, payment
of any defaulted interest or principal in any other lawful manner
not inconsistent with the requirements of any securities exchange on
which the Bonds in respect of which interest is in default may be
listed, and upon such notice as may be required by such exchange,
if, after notice given by the Owner Trustee to the Indenture Trustee
of the proposed payment pursuant to this subparagraph, such payment
shall be deemed practicable by the Indenture Trustee.
(c) Subject to the foregoing provisions of this Section, each Bond
delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Bond shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such
other Bond, and each such Bond shall bear interest from whatever date
shall be necessary so that neither gain nor loss in interest shall result
from such registration of transfer, exchange or replacement.
(e) The Original Indenture is hereby amended by adding a new Section 2.17
thereto immediately following Section 2.16 as follows:
SECTION 2.17. PRINCIPAL AMOUNT OF BONDS PAYABLE WITHOUT PRESENTMENT
OR SURRENDER. All references in this Indenture to the principal amount of
any Bond shall, when used with respect to Amortizing Bonds, shall mean the
unpaid principal amount thereof, except that, for purposes of Sections
2.08, 2.09, 2.10 and 5.07 of this Indenture, principal amount shall, when
used with respect to any such Bond, refer to the original principal amount
thereof prior to the payment of any Installment Payment Amounts.
Notwithstanding anything herein or in any Bond to the contrary, with
respect to each Amortizing Bond, the unpaid principal amount thereof
recorded on the Bond Register shall be controlling as to the remaining
unpaid principal amount thereof.
- 9 -
(f) The Original Indenture is hereby amended by deleting from Section
11.01(a) the clause "to pay, when due, the principal of and premium, if any, and
interest due and to become due on such Bonds or portions thereof on and prior to
the Stated Maturity or Redemption Date thereof, as the case may be" and
substituting in lieu thereof the following:
to pay, when due, the principal of
and premium, if any, and interest
due and to become due on such Bonds
or portions thereof on and prior to
the Stated Maturity or Redemption
Date thereof, including, without
limitation, on any Installment
Payment Date, as the case may be
(g) The Original Indenture is hereby amended by adding the words ",
Installment Payment Dates" after the words "Stated Maturity" each time such
words "Stated Maturity" appear in Section 11.03.
(h) the Original Indenture is hereby amended by deleting Section 8.01 in
its entirety and substituting in lieu thereof the following:
SECTION 8.01. CERTAIN DUTIES
AND RESPONSIBILITIES. (a) The
Indenture Trustee shall have and be
subject to all the duties and
responsibilities specified with
respect to an indenture trustee in
the Trust Indenture Act.
(b) No provision of this
Indenture shall require the
Indenture Trustee to expend or risk
its own funds or otherwise incur
any financial liability in the
performance of any of its duties
hereunder, or in the exercise of
any of its rights or powers, if it
shall have reasonable grounds for
believing that repayment of such
funds or adequate indemnity against
such risk or liability is not
reasonably assured to it.
(c) Whether or not therein
expressly so provided, every
provision of this Indenture
relating to the conduct or
affecting the liability of or
affording protection to the
Indenture Trustee shall be subject
to the provisions of this Section.
(i) The Original Indenture is hereby amended by deleting from Section
8.03 the words "Except as otherwise provided in Section 8.01" and substituting
in lieu thereof the following:
Subject to the provisions of
Section 8.01 and to the applicable
provision of the Trust Indenture Act
(j) The Original Indenture is hereby amended by deleting Section 8.08 in
its entirety and substituting in lieu thereof the following:
- 10 -
SECTION 8.08. DISQUALIFICATION; CONFLICTING
INTERESTS. If the Indenture
Trustee shall have or acquire any
conflicting interest within the
meaning of the Trust Indenture Act,
it shall either eliminate such
conflicting interest or resign to
the extent, in the manner and with
the effect, and subject to the
conditions, provided in the Trust
Indenture Act and this Indenture.
(k) The Original Indenture is hereby amended by adding the words "and
the Trust Indenture Act" to the end of the first sentence of Section 8.09.
(l) The Original Indenture is hereby amended by deleting the reference
in Section 8.10(d)(i) to "Section 8.08(a)" and substituting in lieu thereof the
words "Section 8.08".
(m) The Original Indenture is hereby amended by deleting Section 8.13 in
its entirety and substituting in lieu thereof the following:
SECTION 8.13. PREFERENTIAL
COLLECTION OF CLAIMS AGAINST ANY
OBLIGOR. If the Indenture Trustee
shall be or become a creditor of
any obligor (within the meaning of
the Trust Indenture Act) upon the
Bonds, the Indenture Trustee shall
be subject to any and all
applicable provisions of the
Trustee Indenture Act regarding the
collection of claims against such
obligor.
(n) The Original Indenture is hereby amended by deleting Article NINE in
its entirety and substituting therefor the following:
ARTICLE NINE
HOLDERS' LISTS AND REPORTS
BY INDENTURE TRUSTEE AND LESSEE
SECTION 9.01. LESSEE TO
FURNISH INDENTURE TRUSTEE NAMES AND
ADDRESSES OF HOLDERS.
Semiannually, not later than March
31 and September 30 in each year,
commencing March 31, 199_ and at
such other times as the Indenture
Trustee may request in writing, the
Lessee shall furnish or cause to be
furnished to the Indenture Trustee
information as to the names and
addresses of the Holders, and the
Indenture Trustee shall preserve
such information and similar
information received by it in any
other capacity and afford to the
Holders access to information to
preserve by it, all to such extent,
if any, and in such manner as shall
be required by the Trust Indenture
- 11 -
Act; provided however, that so long
as the Indenture Trustee is the
sole Bond Registrar, or is
otherwise furnished a copy of the
Bond Register, no such list need be
furnished by the Lessee.
SECTION 9.02 REPORTS BY
INDENTURE TRUSTEE AND LESSEE.
Annually, not later than November 1
in each year, the Indenture Trustee
shall transmit to the Holders and
the SEC a report with respect to
any events described in Section
313(a) of the Trust Indenture Act,
in such matter and to the extent
required by the Trust Indenture
Act. The Indenture Trustee shall
transmit to the Holders and the SEC
and the Lessee shall file with the
Indenture Trustee and transmit to
the Holders, such other
information, reports and other
documents, if any, at such times
and in such matter, as shall be
required by the Trust Indenture
Act.
(o) The Original Indenture is hereby amended by adding the words "more
than one year" after the word "made" in clause (z) of Section 11.01(a).
ARTICLE THREE
MISCELLANEOUS
SECTION 3.01. EXECUTION AS SUPPLEMENTAL INDENTURE.
This Supplemental Indenture No. 2 is executed and shall be construed as an
indenture supplemental to the Original Indenture and, as provided in the
Original Indenture, this Supplemental Indenture No. 2 forms a part thereof.
SECTION 3.02. COUNTERPART EXECUTION.
This Supplemental Indenture No. 2 may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.
SECTION 3.03. CONCERNING THE OWNER TRUSTEE.
Anything herein to the contrary notwithstanding, all and each of the
agreements herein made on the part of OT or the Owner Trustee are made and
intended not as personal agreements by OT for the purpose or with the intention
of binding it personally, but are made and intended for the purpose of binding
only the Trust Estate, and this Supplemental Indenture No. 2 is executed and
delivered by the Owner Trustee solely in the exercise of the powers expressly
conferred upon it as trustee under the Trust Agreement; and no personal
liability or responsibility is assumed hereunder by or shall at
- 12 -
any time be enforceable against OT or any successor in trust personally or the
Owner Participant on account of any agreements hereunder of the Owner Trustee,
either express or implied, all such personal liability, if any, being expressly
waived by the Indenture Trustee and the Holders and by all Persons claiming by,
through or under the Indenture Trustee and the Holders; PROVIDED, HOWEVER, that
OT shall be liable hereunder for its own gross negligence or willful misconduct.
If a successor owner trustee is appointed in accordance with the terms of the
Trust Agreement, such successor owner trustee shall, without any further act,
succeed to all the rights, duties immunities and obligations of the Owner
Trustee hereunder, and its predecessor owner trustee and the Owner Trustee in
its individual capacity shall be released from all further duties and
obligations hereunder, without prejudice to any claims against the Owner Trustee
in its individual capacity or the Owner Trustee for any default by the Owner
Trustee in its individual capacity or the Owner Trustee, respectively, in the
performance of its obligations hereunder prior to such appointment.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 2 to be duly executed by their respective officers thereunto
authorized, as of the day and year first above written.
MERIDIAN TRUST COMPANY,
not in its individual
capacity, except as otherwise
expressly provided in the
Indenture, but solely as Owner
Trustee
By:
______________________________
Name:
Title:
THE BANK OF NEW YORK,
as Indenture Trustee
By:
______________________________
Name:
Title:
THE UNITED ILLUMINATING COMPANY
By:
______________________________
Name:
Title:
- 13 -
ACKNOWLEDGMENT
COMMONWEALTH OF PENNSYLVANIA )
) ss.:
COUNTY OF BERKS )
On this __ day of ______, 199_, before me, the undersigned Notary Public,
duly commissioned and qualified within the State and County aforesaid,
personally came and appeared _______________, who being by me duly sworn did say
that he is an _________ of MERIDIAN TRUST COMPANY, a Pennsylvania trust company,
Owner Trustee under the Trust Agreement, and that said instrument was signed on
behalf of said trust company by authority of its Board of Directors and that he
acknowledged said instrument to be the free act and deed of said trust company.
________________________________________________________
Notary Public
My Commission Expires:
- 14 -
ACKNOWLEDGMENT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this __ day of ______, 199_, before me, the undersigned Notary Public,
duly commissioned and qualified within the State and County aforesaid,
personally came and appeared _______________, who being by me duly sworn did say
that she is a ______________________ of THE BANK OF NEW YORK, a New York banking
corporation, Indenture Trustee under the foregoing instrument, and that said
instrument was signed on behalf of said corporation by authority of its Board of
Directors and that she acknowledged said instrument to be the free act and deed
of said corporation.
_____________________________________________________
Notary Public
My Commission Expires:
- 15 -
ACKNOWLEDGMENT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this __ day of ______, 199_, before me, the undersigned Notary Public,
duly commissioned and qualified within the State and County aforesaid,
personally came and appeared _______________, who being by me duly sworn did say
that he is the ______________________ of THE UNITED ILLUMINATING COMPANY, a
Connecticut corporation, and that said instrument was signed on behalf of said
corporation by authority of its Board of Directors and that he acknowledged said
instrument to be the free act and deed of said corporation.
__________________________________________________
Notary Public
My Commission Expires:
- 16 -
EXHIBIT A
FORM OF 199__ BOND
[FRONT]
NUMBER
R-
MERIDIAN TRUST COMPANY,
not in its individual capacity, but solely
as Owner Trustee under a certain
Trust Agreement dated as of
August 1, 1990
SEABROOK 1 SECURED LEASE OBLIGATION BOND,
___% SERIES DUE ______ 2, _____
INTEREST RATE MATURITY DATE CUSIP
------------- ------------- -----
___% _____________ _____
REGISTERED HOLDER:
ORIGINAL PRINCIPAL AMOUNT: DOLLARS
MERIDIAN TRUST COMPANY, a Pennsylvania trust company, not in its individual
capacity, but solely as Owner Trustee (the "OWNER TRUSTEE," which term includes
any successor institution and/or individual comprising such trustee under the
Indenture hereafter referred to) under the Trust Agreement, dated as of August
1, 1990, with the Owner Participant named therein, for value received hereby
promises to pay to the Registered Holder named above, or registered assigns, the
unpaid portion of the Original Principal Amount (stated above) in installments
on each Installment Payment Date as set forth herein with the final installment
due and payable on the Maturity Date (stated above) and to pay interest
(computed on the basis of a 360-day year consisting of twelve 30-day months)
thereon from the most recent interest payment date to which interest has been
paid or duly provided for or, if this Bond is dated prior to _________ 2, 199_,
the date of the original issuance of Bonds of this series, semiannually on
January 2 and July 2 in each year, commencing _______ 2, 199_, at the Interest
Rate (stated above) per annum, until the principal hereof is paid in full or
made available for payment. As provided in such indenture, the interest or
Installment Payment Amount so payable shall be paid to the person in whose name
this Bond, or one or more Predecessor Bonds (such term and all other capitalized
terms used herein and not defined herein having the meanings ascribed thereto in
the Indenture), is registered at the close of business on the Regular Record
Date for such interest or installment of principal, which shall be the December
15 (with respect to a January 2 payment date) or the June 15 (with respect to a
July 2 payment date), as the case may be (whether or not a Business Day),
immediately preceding such interest payment date or Installment Payment Date.
The foregoing notwithstanding, any such interest or Installment Payment Amount
which is not so punctually paid or duly provided for shall forthwith cease to be
payable to the Holder on such Regular Record Date to the extent that the Owner
Trustee has elected to pay such
default interest or principal in the following manner: (x) to the person in
whose name this Bond, or one or more Predecessor Bonds, is registered at the
close of business on a Special Record Date for the payment of such defaulted
interest or principal to be fixed by the Indenture Trustee (as defined on the
reverse hereof), notice of which shall be given by the Indenture Trustee to the
Holders of Bonds in respect of which interest or principal is in default not
less than 10 days prior to such Special Record Date, or (y) in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Bonds of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture referred
to on the reverse hereof. Payment of the principal of and premium, if any, and
interest on this Bond shall be made to the Holder upon presentation and
surrender hereof at the corporate trust office of any Paying Agent, except that
interest and Installment Payment Amounts on this Bond (other than such amounts
payable on the Stated Maturity thereof) shall be made without presentation or
surrender thereof, by check drawn upon the Paying Agent and mailed to the
address of the Holder of this Bond as such address shall appear in the Bond
Register and except that if such Holder shall be a securities depositary, such
payment may be made by such means in lieu of check as shall be agreed upon by
the Owner Trustee, the Lessee, the Indenture Trustee and such Holder. Payment as
aforesaid of the principal of, premium, if any, and interest on this Bond shall
be made in such coin and currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts.
As provided in the above-referenced Indenture, in any case where any
Redemption Date applicable to this Bond, any Installment Payment Date or the
Stated Maturity of principal of, or any installment or interest on, this Bond or
any date on which any defaulted interest or principal is proposed to be paid
with respect to this Bond, shall not be a Business Day, then (any provision of
such Indenture or of this Bond to the contrary notwithstanding) payment of
interest and/or principal and premium, if any shall be made on the next
succeeding Business Day with the same force and effect as if made on or at such
nominal Redemption Date, Installment Payment Date, Stated Maturity or date on
which such defaulted interest was proposed to have been paid, and no interest
shall accrue on the amount so payable for the period from and after such
Redemption Date, Installment Payment Date, Stated Maturity or date for the
payment of such defaulted interest or principal, as the case may be, to the next
succeeding Business Day.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON
THE REVERSE HEREOF, WHICH 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 manual
signature by the Indenture Trustee or an Authenticating Agent appointed pursuant
to the terms of the Indenture, this Bond shall not be entitled to any benefit
under the above-referenced Indenture or be valid or obligatory for any purpose.
- 2 -
IN WITNESS WHEREOF, the Owner Trustee has caused this Bond to be duly
executed under its corporate seal.
Dated:
Attest:
[SEAL] MERIDIAN TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By
_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds of the series
designated therein referred to in the within-
mentioned Indenture.
THE BANK OF NEW YORK,
As Indenture Trustee
By _____________________________
Authorized Signatory
- 3 -
[BACK]
MERIDIAN TRUST COMPANY,
not in its individual capacity, but solely
as Owner Trustee under a certain
Trust Agreement dated as of
August 1, 1990
SEABROOK 1 SECURED LEASE OBLIGATION BOND,
____% SERIES DUE _____________ 2, _____
This Bond is one of an authorized issue of bonds of the Owner Trustee
comprised of two series, designated, respectively, "SEABROOK 1 SECURED LEASE
OBLIGATION BONDS, % SERIES DUE _______ 2, " and "SEABROOK 1 SECURED LEASE
OBLIGATION BONDS, % SERIES DUE _______ 2, ." The Bonds of this series are issued
under and secured by an Indenture of Mortgage and Deed of Trust, dated as of
August 1, 1990 (the "ORIGINAL INDENTURE"), among the Owner Trustee, The United
Illuminating Company, a Connecticut corporation (the "LESSEE," which term
includes any successor lessee under the Lease referred to hereinbelow), and The
Bank of New York, a New York banking corporation (the "INDENTURE TRUSTEE," which
term includes any successor trustee under the Indenture, as supplemented by
Supplemental Indenture No. 1, dated as of August 1, 1990, among such parties,
and as supplemented by Supplemental Indenture No. 2, dated as of _________,
199_, among such parties (the Original Indenture, as supplemented by such
supplemental indentures and as it may be further supplemented from time to time
by other indentures supplemental thereto, being hereinafter referred to as the
"INDENTURE")). The Indenture permits the issuance of additional series of Bonds
for the purposes and as provided therein. The Bonds of this series are secured
equally and ratably with one another and with any other Bonds issued under the
Indenture (the Bonds of this series, together with all other bonds issued under
the Indenture, being hereinafter collectively referred to as the "BONDS").
Reference is hereby made to the Indenture for a description of the property
assigned, pledged and transferred thereunder and the respective rights of the
Holders and of the Indenture Trustee and the Owner Trustee in respect of such
security and the terms upon which the Bonds are and are to be authenticated and
delivered. The Holder of this Bond, by its acceptance hereof, is deemed to have
consented and agreed to all the terms and provisions of the Indenture.
All payments of principal, premium, if any, and interest to be made hereunder
and otherwise under the Indenture shall be secured by, and, except as otherwise
expressly provided in the Indenture, shall be made only from, the assets subject
to the lien of the Indenture and the income and proceeds received by the
Indenture Trustee therefrom, including the rights of the Owner Trustee, as
Lessor under a certain Facility Lease with the Lessee relating to an undivided
interest in certain assets constituting part of Unit No. 1 of the Seabrook
Station, located in Seabrook, New Hampshire (such Facility Lease, as executed
and delivered and as it may be amended or supplemented from time to time in
accordance with its terms, being hereinafter referred to as the "LEASE"), to
receive basic rentals and certain other payments thereunder, which basic rentals
and other payments will (subject to the right of the Lessee to terminate the
Lease without further payments upon certain breaches of the Lessee's quiet
enjoyment of such Unit No. 1) be calculated to be at least sufficient to provide
for the scheduled payments of the principal of and interest on this and each
other Bond issued under the Indenture. Each Holder of this Bond, by its
acceptance hereof, is deemed to have agreed that, subject to the next succeeding
sentence hereof and except as otherwise expressly provided in the Indenture, (x)
it will look solely to the assets subject to the lien of the Indenture or the
income or proceeds received by the Indenture Trustee therefrom to the extent
- 4 -
available for distribution to the Holder hereof as provided in the Indenture,
and (y) neither the Owner Participant, the Indenture Trustee nor the Owner
Trustee in its individual capacity is liable to the Holder hereof or, in the
case of the Owner Participant or the Owner Trustee in its individual capacity,
to the Indenture Trustee, for any amounts payable on this Bond or otherwise
under the Indenture. In the event that the Lessee, or the Lessee and an
affiliate thereof, shall have assumed the obligations of the Owner Trustee
hereunder and otherwise under the Indenture pursuant to and in accordance with
the provisions of Section 2.16 of the Original Indenture, each Holder hereof, by
its acceptance hereof, is deemed further to have agreed that all payments to be
made hereunder and otherwise under the Indenture shall be made by the Lessee, or
the Lessee and such affiliate (as the case may be), and from the Indenture
Estate, and, in such event, the Holder hereof will look solely to the Indenture
Estate and the Lessee and, if applicable, such affiliate for such payment. Under
certain circumstances described in Article 13 of the Original Indenture, upon
such an assumption, the lien of the Indenture upon the Indenture Estate may be
thereupon released and discharged.
With certain exceptions as therein provided, the supplementation of the
Indenture for the purpose of adding any provisions thereto, or changing in any
manner or eliminating any of the provisions thereof, will require the consent of
the Holders of not less than a majority in aggregate unpaid principal amount of
the Outstanding Bonds of all series, considered as one class; PROVIDED, HOWEVER,
that if at any given time (x) there shall be Bonds of more than one series
Outstanding and (y) a proposed supplemental indenture shall directly affect the
rights of the Holders of Bonds of one or more, but less than all, of such
series, then the consent only of the Holders of a majority in aggregate unpaid
principal amount of the Outstanding Bonds of all series so directly affected,
considered as one class, shall be required. The Indenture also contains
provisions permitting the Holders of not less than a majority in aggregate
unpaid principal amount of the Outstanding Bonds of all series, considered as
one class, on behalf of the Holders of all of the Bonds, to waive certain past
defaults under the Indenture and their consequences. Any such consent or waiver
by the Holder of this Bond shall be conclusive and binding upon such Holder and
upon all future Holders of this Bond and of any Bond issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not notation of such consent or waiver is made upon this Bond.
On each Installment Payment Date set forth below, the Owner Trustee shall pay
an installment of principal of this Bond equal (subject to adjustment as
hereinafter described) in amount to the Installment Payment Percentage set forth
below for such Installment Payment Date multiplied by the Original Principal
Amount stated on the face of this Bond.
- 5 -
Installment Installment Outstanding
Payment Date Payment Percentage Balance Factor
------------ ------------------ --------------
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
January 2, . . . . . . . . .
July 2,. . . . . . . . . . .
The "Outstanding Balance Factor" as used in the foregoing table is for
descriptive purposes only, and, unless there has been a partial redemption or a
default or another installment payment adjustment, when multiplied by the
Original Principal Amount of this Bond, represents the remaining unpaid
principal amount of this Bond as of the Installment Payment Date indicated after
payment of the principal installment on such date.
As provided in the Indenture, the installment payments of principal for the
Bonds of any series may be adjusted at the discretion of the Owner Trustee in
connection with certain recalculations of basic rent pursuant to the Lease;
PROVIDED, HOWEVER, that, among other restrictions, no such adjustment shall be
made which will (x) increase or decrease the average life of the Bonds of any
series (measured from the date of initial issuance thereof and calculated in
accordance with generally accepted financial practice) by more than six months
except in the case of such an adjustment occasioned by Lessee's failure to
obtain a License Extension in which case no such adjustment shall be made which
will decrease the average life of the Bonds of any series (measured as
aforesaid) by more than twenty-four months and in which case any such adjustment
will result in the final payment or redemption of the Bonds of such series being
scheduled to occur no later than the last day of the Basic Lease Term or (y)
extend the Stated Maturity of principal of the Bonds of any series.
In the event of any partial redemption of Bonds of this series, other than
pursuant to the above-mentioned installment payments of principal, the amount of
each installment payment of principal to be
- 6 -
paid thereafter pursuant to the installment payment schedule shall be adjusted
in accordance with the Indenture.
If the Lessee shall have exercised its option to terminate the Lease pursuant
to Section 14 thereof, then the Owner Trustee shall redeem, on the date of such
termination, all Bonds then Outstanding at a redemption price equal to the
unpaid principal amount thereof plus accrued interest, if any, to the date fixed
for redemption. If the Lessee shall have exercised its option to terminate the
Lease pursuant to Section 13(f) or (g) thereof, then the Owner Trustee shall
redeem, on the date of such termination, all Bonds then Outstanding which shall
not have been assumed by the Lessee, or the Lessee and an affiliate thereof, as
provided in Section 2.16(b) of the Original Indenture, at a redemption price
equal to the unpaid principal amount thereof plus accrued interest, if any, to
the date fixed for redemption.
The Bonds of this series shall be subject to redemption, at the option of the
Owner Trustee, in whole at any time or in part from time to time, at the
Redemption Prices of 100% of the unpaid principal amount of such Bonds to be so
redeemed, plus accrued interest, if any, thereon to the date fixed for
redemption, plus the Make-Whole Premium, if any, for the Bonds calculated as
provided in the Indenture.
In the event that any Bonds are called for redemption, the Indenture Trustee
shall give notice to the Holders thereof, in accordance with Section 5.05 of the
Original Indenture, not less than 30 nor more than 60 days prior to the date
fixed for redemption.
With respect to any notice of redemption of Bonds of this series otherwise
than through installment payments of principal payable on Installment Payment
Dates, unless, upon the giving of such notice, such Bonds shall be deemed to
have been paid in accordance with the provisions of the Indenture, such notice
shall state that such redemption shall be conditional upon the receipt by the
Indenture Trustee, on or prior to the date fixed for such redemption, of money
sufficient to pay the principal of and premium, if any, and interest on such
Bonds and that, if such money shall not have been so received by such date, such
notice shall be of no force or effect and the Owner Trustee shall not be
required to redeem such Bonds. In the event that such notice of redemption
contains such a condition and such money is not so received, the redemption
shall not be made.
Bonds (or portions thereof as aforesaid) for which redemption and payment
provision is made in accordance with the Indenture shall thereupon cease to be
entitled to the lien of the Indenture and shall cease to bear interest from and
after the date fixed for redemption.
Notwithstanding anything to the contrary set forth herein or in the
Indenture, the unpaid principal amount hereof recorded on the Bond Register
maintained by the Bond Registrar shall be controlling as to the remaining unpaid
principal amount hereof.
Upon the occurrence and continuance of any Indenture Event of Default, the
principal of this Bond may become or be declared immediately due and payable in
the manner and with the effect provided in the Indenture.
This Bond is transferable by the Holder hereof in person or by attorney
authorized in writing, at the Corporate Trust Office of the Bond Registrar (or
if such office is not in the Borough of Manhattan, The City of New York, at
either such office or an office to be maintained in such Borough). Upon
surrender for registration of transfer of this Bond, the Owner Trustee shall
execute, and the Indenture Trustee (or any Authenticating Agent) shall
authenticate and deliver, in the name of the designated transferee or
- 7 -
transferees, one or more new Bonds of the same series, of authorized
denominations and of like tenor and aggregate principal amount.
The Refunding Bonds of this series are issuable only as fully registered
Bonds in denominations of $1,000 and/or any integral multiple thereof. As
provided in and subject to the provisions of the Indenture, Bonds may be
exchanged for other Bonds of the same series, of authorized denominations and of
like tenor and aggregate principal amount, upon surrender thereof at any office
maintained for such purpose pursuant to the Indenture.
No service charge will be made to any Holder of Bonds for any registration of
transfer or exchange thereof, but the Bond Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
The person in whose name this Bond is registered shall be deemed to be the
owner hereof for the purpose of receiving payment as herein provided and for all
other purposes whether or not this Bond be overdue, regardless of any notice to
anyone to the contrary.
As provided in the Indenture, the Indenture and the Bonds shall be governed
by and construed in accordance with the laws of the State of New York, except to
the extent that the laws of any other jurisdictions are mandatorily applicable
thereto and hereto.
- 8 -
SCHEDULE U1S
DESCRIPTION OF UNIT 1 SITE
[Attach original such schedule.]
EXHIBIT C
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS SUPPLEMENTED
BY THIS LEASE SUPPLEMENT NO. 1 HAVE BEEN ASSIGNED TO, AND ARE SUBJECT TO A
SECURITY INTEREST IN FAVOR OF THE INDENTURE TRUSTEE UNDER INDENTURE OF MORTGAGE
AND DEED OF TRUST, DATED AS OF AUGUST 1, 1990, AS SUPPLEMENTED. THIS LEASE
SUPPLEMENT NO. 1 HAS BEEN EXECUTED IN SEVERAL COUNTERPARTS. SEE SECTION 3(c) OF
THIS LEASE SUPPLEMENT NO. 1 FOR INFORMATION CONCERNING THE RIGHTS OF HOLDERS OF
VARIOUS COUNTERPARTS HEREOF.
THIS COUNTERPART IS NOT THE ORIGINAL COUNTERPART.
================================================================================
LEASE SUPPLEMENT NO. 1
dated as of _________ __, 1995
to
FACILITY LEASE
dated as of August 1, 1990,
between
MERIDIAN TRUST COMPANY
not in its individual capacity, but solely as
Owner Trustee under Trust Agreement,
Lessor
and
THE UNITED ILLUMINATING COMPANY,
Lessee
================================================================================
Lease of an Undivided Interest in
Unit No. 1 of the Seabrook Nuclear Power Plant
================================================================================
CERTAIN RIGHTS OF THE LESSOR UNDER THE FACILITY LEASE AS SUPPLEMENTED
BY THIS LEASE SUPPLEMENT NO. 1 HAVE BEEN ASSIGNED TO, AND ARE SUBJECT TO A
SECURITY INTEREST IN FAVOR OF THE INDENTURE TRUSTEE UNDER INDENTURE OF MORTGAGE
AND DEED OF TRUST, DATED AS OF AUGUST 1, 1990, AS SUPPLEMENTED. THIS LEASE
SUPPLEMENT NO. 1 HAS BEEN EXECUTED IN SEVERAL COUNTERPARTS. SEE SECTION 3(c) OF
THIS LEASE SUPPLEMENT NO. 1 FOR INFORMATION CONCERNING THE RIGHTS OF HOLDERS OF
VARIOUS COUNTERPARTS HEREOF.
THIS COUNTERPART IS THE ORIGINAL COUNTERPART. RECEIPT OF THIS ORIGINAL
COUNTERPART IS HEREBY ACKNOWLEDGED BY THE BANK OF NEW YORK, AS INDENTURE
TRUSTEE.
By:
_________________________________
Authorized Signatory
================================================================================
LEASE SUPPLEMENT NO. 1
dated as of __________ __, 1995
to
FACILITY LEASE
dated as of August 1, 1990,
between
MERIDIAN TRUST COMPANY
not in its individual capacity, but solely as
Owner Trustee under Trust Agreement,
Lessor
and
THE UNITED ILLUMINATING COMPANY,
Lessee
================================================================================
Lease of an Undivided Interest in
Unit No. 1 of the Seabrook Nuclear Power Plant
================================================================================
This LEASE SUPPLEMENT NO. 1, dated as of __________ __, 1995 ("Lease
Supplement No. 1"), to FACILITY LEASE, dated as of August 1, 1990 (the "Facility
Lease"), between MERIDIAN TRUST COMPANY, a Pennsylvania trust company, not in
its individual capacity, but solely as Owner Trustee (the "Lessor"), under the
Trust Agreement (such term, and all other capitalized terms used herein without
definition, being defined as provided in Section 1 below), and THE UNITED
ILLUMINATING COMPANY, a Connecticut corporation (the "Lessee"),
W I T N E S S E T H:
WHEREAS, the Lessee and the Lessor have heretofore entered into the
Facility Lease providing for the lease by the Lessor to the Lessee of the
Undivided Interest; and
WHEREAS, the Lessee, the Lessor, the Owner Participant, the Owner
Trustee and the Indenture Trustee have entered into a Refunding Agreement, dated
as of _________ __, 1995, providing for the issuance by the Owner Trustee of
Additional Bonds, including Refunding Bonds, to provide funds to redeem the
Outstanding Initial Series Bonds and to pay certain other costs incurred in
connection therewith (such Additional Bonds, the "1995 Bonds"); and
WHEREAS, the Owner Trustee and the Indenture Trustee have entered into
Supplemental Indenture No. 2, dated as of _________ __, 199_, to the Indenture
creating the 1995 Bonds for such purpose and establishing the terms, conditions
and designations thereof; and
WHEREAS, Section 3(e) of the Facility Lease provides for an adjustment
to Basic Rent and to the Value Schedules in order to preserve the Net Economic
Return in the event, among other things, of the issuance of the Refunding Bonds;
NOW, THEREFORE, in consideration of the premises and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS.
For purposes hereof, capitalized terms used herein and not otherwise
defined herein or in the recitals shall have the meanings assigned to such terms
in Appendix A to the Facility Lease.
SECTION 2. AMENDMENTS; SCHEDULES.
(a) As of the date first written above, Section 3(e)(ii) of the
Facility Lease is hereby amended by adding thereto after the word "Assumptions"
the following:
or if the expenses paid
by the Lessor in
connection with the issue
of any Refunding Bonds
are not equal to the
amounts set forth as such
in the Pricing
Assumptions
(b) As of the date first written above and until and unless further
amended, Schedules 1 through 5 of the Facility Lease are hereby amended as
follows:
(i) Schedule 1 to the Facility Lease entitled "Basic Rent
Percentages" is deleted in its entirety and is hereby replaced with Schedule 1
hereto.
(ii) Schedule 2 to the Facility Lease entitled "Schedule of
Casualty Values" is deleted in its entirety and is hereby replaced with Schedule
2 hereto.
(iii) Schedule 3 to the Facility Lease entitled "Schedule of
Special Casualty Values" is deleted in its entirety and is hereby replaced with
Schedule 3 hereto.
(iv) Schedule 4 to the Facility Lease entitled "Schedule of Net
Casualty Values" is deleted in its entirety and is hereby replaced with Schedule
4 hereto.
(v) Schedule 5 to the Facility Lease entitled "Schedule of Net
Special Casualty Values" is deleted in its entirety and is hereby replaced with
Schedule 5 hereto.
(c) Appendix A to the Facility Lease is hereby amended by adding the
following definition thereto:
REFUNDING AGREEMENT shall mean the Refunding Agreement, dated as
of _______, 199_, among the Owner Participant, the Owner Trustee, the
Indenture Trustee and the Lessee.
REFUNDING EXPENSES shall have the meaning set forth in the
Refunding Agreement.
(d) The definition of "Net Economic Return" in Appendix A is hereby
amended in its entirety as follows:
NET ECONOMIC RETURN shall mean:
(i) the net after-tax economic yield expected by the Owner
Participant as of the date of the initial authentication and delivery of the
199_ Bonds (as defined in the Indenture) with respect to the Undivided Interest,
calculated using the Assumptions and the initial computations of Basic Rent,
Casualty Values and Special Casualty Values derived therefrom (the "SCHEDULES
AND ASSUMPTIONS") as such yield shall be adjusted pursuant to and in accordance
with Section 3 of the Facility Lease and as agreed between the Lessee and the
Owner Participant; and
(ii)(a) until June 30, 2001 and thereafter if the License Extension
is granted by such date, the sum of after-tax cash flow over the Basic Lease
Term at least equal to that expected by the Owner Participant as of the date of
the initial authentication and delivery of the
- 2 -
199_ Bonds (as defined in the Indenture) calculated using the Schedules and
Assumptions (the "ORIGINAL AFTER-TAX CASH FLOW") or (b) after June 20, 2001 if
the License Extension is not granted by such date, the product of the Original
After-Tax Cash Flow multiplied by a fraction (I) the numerator of which is the
number of months in the Basic Lease Term (assuming the License Extension is not
granted) and (II) the denominator of which is the number of months in the Basic
Lease Term (assuming the License Extension is granted); and
(iii) the same general pattern of after-tax Earnings originally
expected by the Owner Participant as of the date of the initial authentication
and delivery of the 199_ Bonds (as defined in the Indenture) calculated using
the Schedules and Assumptions.
Notwithstanding the above, nothing in this definition shall be construed to
obligate the Lessee to restore any portion of a reduction in Earnings where such
portion of the reduction is due to events other than changes in Basic Rent
provided for in the Transaction Documents, including, by example, changes in
Financial Accounting Standards Board Statement No. 13 occurring after the date
of the initial authentication and delivery of the 199_ Bonds (as defined in the
Indenture).
For the purposes of this definition, the Assumptions shall be deemed to
include the assumptions that (i) the Owner Participant is fully taxable during
the entire Basic Lease Term (PROVIDED, HOWEVER, that nothing in this definition
or the Participation Agreement shall be construed to be a representation by the
Owner Participant as to the actual residual value assumed by the Owner
Participant for purposes of calculating its earnings according to Financial
Accounting Standards Board Statement No. 13 accounting or for any other purpose)
and (ii) none of the Investment is comprised of borrowed funds.
(e) The definition of "Transaction Documents" set forth in Appendix A
is hereby amended by adding after the word "Bonds" the words "and the Refunding
Agreement."
(f) Schedule U1S to the Facility Lease is attached hereto.
SECTION 3. MISCELLANEOUS.
(a) COUNTERPART EXECUTION. This Lease Supplement No. 1 may be
executed in any number of counterparts and by each of the parties hereto or
thereto on separate counterparts, all such counterparts together constituting
but one and the same instrument.
(b) EXECUTION AS LEASE SUPPLEMENT. This Lease Supplement No. 1 is
executed and shall be construed as a supplement and amendment to the Facility
Lease and shall form a part thereof. On and from the delivery of this Lease
Supplement No. 2, any reference in any Transaction Document to the
- 3 -
Facility Lease shall be deemed to refer to the Facility Lease as supplemented
and amended by this Lease Supplement No. 1.
(c) ORIGINAL COUNTERPART. The single executed original of this Lease
Supplement No. 1 marked "THIS COUNTERPART IS THE ORIGINAL COUNTERPART" and
containing the receipt of the Indenture Trustee thereon shall be the "Original"
of this Lease Supplement No. 1. To the extent that the Facility Lease, as
supplemented by this Lease Supplement No. 1, constitutes chattel paper, as such
term is defined in the Uniform Commercial Code as in effect in any applicable
jurisdiction, no security interest in the Facility Lease, as so supplemented,
may be created or continued through the transfer or possession of any
counterparts of the Facility Lease and supplements thereto other than the
"Originals" of any thereof.
- 4 -
IN WITNESS WHEREOF, each of the parties hereto has caused this Lease
Supplement No. 1 to be duly executed by an officer thereunto duly authorized, as
of the date set forth above.
MERIDIAN TRUST COMPANY,
not in its individual
capacity but solely as
Owner Trustee
By:
___________________________________
Name:
Title:
THE UNITED ILLUMINATING COMPANY
By:
___________________________________
Name:
Title:
- 5 -
ACKNOWLEDGMENT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this ____ day of _______, 199_, before me, the undersigned Notary
Public, duly commissioned and qualified within the State and County aforesaid,
personally come and appeared ___________, who being by me duly sworn did say
that he is the __________ of THE UNITED ILLUMINATING COMPANY, a Connecticut
corporation, and that said instrument was signed on behalf of said corporation
by authority of its Board of Directors and that he acknowledged said instrument
to be the free act and deed of said corporation.
_______________________________
Notary Public
My Commission Expires:
ACKNOWLEDGMENT
COMMONWEALTH OF PENNSYLVANIA )
) ss.:
COUNTY OF BERKS )
On this ____ day of _______, 199_, before me, the undersigned Notary
Public, duly commissioned and qualified within the State and County aforesaid,
personally come and appeared __________, who being by me duly sworn did say that
he is a(n) ______________ of MERIDIAN TRUST COMPANY, a Pennsylvania trust
company, Owner Trustee under the Trust Agreement, and that said instrument was
signed on behalf of said trust company by authority of its Board of Directors
and that he acknowledged said instrument to be the free act and deed of said
trust company.
_____________________________
Notary Public
My Commission Expires:
SCHEDULE 1
TO LEASE
SUPPLEMENT
NO. 1
BASIC RENT PERCENTAGES
BASIC RENT PERCENTAGE OF
PAYMENT DATE ADVANCE ARREARS FACILITY COST
------------ ------- ------- -------------
SCHEDULE 2
TO LEASE
SUPPLEMENT
NO. 1
SCHEDULE OF CASUALTY VALUES
BASIC RENT PERCENTAGE OF
PAYMENT DATE FACILITY COST
------------ -------------
SCHEDULE 3
TO LEASE
SUPPLEMENT
NO. 1
SCHEDULE OF SPECIAL CASUALTY VALUES
BASIC RENT PERCENTAGE OF
PAYMENT DATE FACILITY COST
------------ -------------
SCHEDULE 4
TO LEASE
SUPPLEMENT
NO. 1
SCHEDULE OF NET CASUALTY VALUES
BASIC RENT PERCENTAGE OF
PAYMENT DATE FACILITY COST
------------ -------------
SCHEDULE 5
TO LEASE
SUPPLEMENT
NO. 1
SCHEDULE OF NET SPECIAL CASUALTY VALUES
BASIC RENT PERCENTAGE OF
PAYMENT DATE FACILITY COST
------------ -------------
SCHEDULE U1S
DESCRIPTION OF UNIT 1 SITE
[Attach original schedule.]
EXHIBIT D
================================================================================
AMENDMENT NO. 1
dated as of November __, 1995
to
TAX INDEMNIFICATION AGREEMENT
dated as of August 1, 1990
Between
FINANCIAL LEASING CORPORATION
Beneficiary under Trust Agreement,
dated as of August 1, 1990
with
MERIDIAN TRUST COMPANY,
AS OWNER TRUSTEE,
Lessor,
and
THE UNITED ILLUMINATING COMPANY
Lessee
================================================================================
SALE AND LEASEBACK OF AN UNDIVIDED INTEREST IN UNIT NO. 1
OF THE SEABROOK NUCLEAR POWER PLANT
================================================================================
AMENDMENT NO. 1, dated as of November __, 1995 ("TIA Amendment No.
1"), to TAX INDEMNIFICATION AGREEMENT, dated as of August 1, 1990, between
FINANCIAL LEASING CORPORATION, a Massachusetts corporation (the "Owner
Participant"), Beneficiary under the Trust Agreement, with MERIDIAN TRUST
COMPANY, a Pennsylvania trust company, not in its individual capacity, but
solely as Owner Trustee under the Trust Agreement (the "Lessor") and THE UNITED
ILLUMINATING COMPANY, a Connecticut corporation (the "Lessee"). Capitalized
terms not otherwise defined herein shall have the respective meanings specified
in Appendix A to the Participation Agreement, dated August 1, 1990, between the
Owner Participant, the Lessor, the Bank of New York, in its individual capacity
and as Indenture Trustee under the Indenture and the Lessee, as amended by
Amendment No. 1 thereto, dated as of the date hereof and as otherwise modified,
amended or supplemented pursuant to the terms thereof (the "Participation
Agreement") or the Refunding Agreement, dated as of _______, 1995, among the
Owner Participant, the Lessor, the Bank of New York, a New York banking
corporation, not in its individual capacity but solely as Indenture Trustee
under the Indenture, and the Lessee,
WHEREAS, pursuant to the Participation Agreement, the Lessor agreed
to purchase the Undivided Interest with funds provided by the Owner Participant
and by the issuance of the Initial Series Bonds;
WHEREAS, the Lessor executed the Facility Lease pursuant to which
the Lessor has leased the Undivided Interest to the Lessee;
WHEREAS, the Lessee and the Owner Participant, have agreed for the
Owner Participant to make an additional equity investment and to cause the
refinancing of the Initial Series Bonds through the issuance of Additional Bonds
in amounts which, when added to the equity investment made by the Owner
Participant and any Supplemental Rent paid by the Lessee, will be sufficient to
pay the Refunding Expenses and redeem the Initial Series Bonds, including any
premium and accrued interest thereon; and
WHEREAS, the Owner Participant and the Lessee have heretofore
executed the Tax Indemnification Agreement, dated as of August 1, 1990 (the "Tax
Indemnification Agreement"), and desire to amend the Tax Indemnification
Agreement as hereinafter provided to clarify their respective rights and
obligations arising from the Refunding;
NOW, THEREFORE, THIS AGREEMENT WITNESSETH:
The Tax Indemnification Agreement is hereby amended, effective upon
the execution and delivery of this Agreement, as follows:
1. Section 1.1(h) thereof is amended by (i) inserting the words
"or the Refunding Documents" immediately after the words "the Transaction
Documents" and
immediately before the words "other than (i) payments", (ii) inserting the words
"or the Refunding Documents" immediately after the words "the Transaction
Documents" and immediately before the words "at the time such payments", (iii)
deleting the word "and" before "(vii)" and (iv) inserting the words ", (viii)
any Supplemental Rent paid in connection with the Refunding, and (ix) any
"Defeasance Deposit Income" (as defined in Section 1.1(t) below)" immediately
after the words "retained by the Owner Participant."
2. Section 1.1(i) thereof is amended by (i) inserting the words
"through December 31, 1990 and 35% for each taxable year of the Owner
Participant" immediately after the words "each taxable year" and immediately
before the words "thereafter, without giving effect".
3. Section 1.1(k) thereof is amended by inserting the words "or
the Refunding Documents" immediately after the words "the Transaction Documents"
and immediately before the words "will be treated".
4. Section 1.1(o) thereof is amended by inserting the words ",
Retirement Premium Deduction, Refunding Amortization Deductions" immediately
after the words "the Amortizing Deductions" and immediately before the words
"and the Interest Deductions".
5. Section 1.1 thereof is amended by adding the following tax
assumptions after Section 1.1(q):
"(r) The Owner Participant will be allowed a deduction for the
premium paid with respect to the Refunded Bonds in the taxable year of the
Owner Participant in which such premium is paid (the "Retirement Premium
Deduction"); and the Owner Participant will be entitled to take the
Retirement Premium Deduction into account in computing its consolidated
federal income tax liability.
(s) The Owner Participant will be allowed current deductions for
amortization of an amount equal to the Refunding Expenses to the extent
payable by the Owner Trustee pursuant to Section 5 of the Refunding
Agreement computed on a straight-line basis from the Refunding Date to the
end of the Basic Lease Term (the "Refunding Amortization Deductions"); and
the Owner Participant will be entitled to take the Refunding Amortization
Deductions into account in computing its consolidated federal income tax
liability."
(t) The Owner Participant will be required to include in taxable
income interest accruing on [the Defeasance Deposit] in the taxable year
in which such interest accrues (the "Defeasance Deposit Income") and the
Interest Deductions will include interest accruing on the Refunded Bonds
(which will continue to be sourced in
2
the United States) from the Refunding Date through the date the Refunded
Bonds are actually redeemed.
6. Section 1.1 thereof is amended by replacing "(q)" immediately
after the words "The foregoing clauses (a) through" with "(t)".
7. Section 1.2(1)(d) thereof is amended by inserting the words
"the Retirement Premium Deduction, the Refunding Amortization Deductions"
immediately after the words "the Amortization Deductions," and immediately
before the words "or any corresponding deduction or credit".
8. Section 1.2(1) is amended by adding the following
representation after Section 1.2(1)(e):
(f) The Owner Participant will be entitled to deduct the Bond
Retirement Premium and the Refunding Amortization Deductions in accordance
with the assumptions set forth in Sections 1.1(r) and 1.1(s).
9. Section 1.2(2) thereof is amended by inserting the words "or
the Refunding Documents" immediately after the words "the Transaction Documents"
and immediately before the words ", the Plant Agreements".
10. Section 2 thereof is amended by inserting the words "or the
Refunding Documents" immediately after the words "the Transaction Documents" and
immediately before the words "to enable the Owner Participant".
11. Section 3.1(a)(1)(A) thereof is amended by (i) inserting the
words "or the Refunding Documents" immediately after the words "the Transaction
Documents" and immediately before the semicolon; and (ii) inserting the words
"the Refunding Documents" immediately after the words "the Transaction
Documents" and immediately before the comma ending the subsection.
12. Section 3.1(a)(1)(B) thereof is amended by inserting the words
"or the Refunding Documents" immediately before the comma ending the subsection.
13. Section 3.1(a)(2)(A) thereof is amended by inserting the words
"the Retirement Premium Deduction, the Refunding Amortization Deductions",
immediately after the words "the Amortization Deductions," and immediately
before the words "or the Interest Deductions".
14. Section 3.1(a)(2)(B) thereof is amended by (i) inserting the
words "or the Refunding Documents" immediately after the words "the Transaction
Documents" and
3
immediately before the words "shall be treated" and (ii) inserting the words
"Refunding Documents" immediately before the semicolon.
15. Section 3.1(b) thereof is amended by inserting the words "or
the Refunding Documents" immediately after the words "the Transaction Documents"
and immediately before the words "(other than".
16. Section 3.1(c) thereof is amended by inserting the words ",
the Refunding Documents" immediately after the words "the Transaction Documents"
and immediately before the words "or the Plant Agreement".
17. Section 4(a) thereof is amended by inserting the words "and
the Refunding Documents," immediately after the words "the Transaction
Documents" and immediately before the words "or (2) so long as".
18. Section 4(b) thereof is amended by inserting the words "and
the Refunding Documents," immediately after the words "the Transaction
Documents" and immediately after the words "or (y) so long as".
19. Section 6(a) thereof is amended by (i) inserting the words ",
the Retirement Premium Deduction, the Refunding Amortization Deductions"
immediately after the words "the Amortization Deductions" and immediately before
the words "or the Interest Deductions" and (ii) inserting the words "or the
Refunding Documents" immediately after the words "the Transaction Documents" and
immediately before the semicolon.
20. Section 6(b) thereof is amended by inserting the words ", the
Retirement Premium Deduction, the Refunding Amortization Deductions" immediately
after the words "the Amortization Deductions" and immediately before the words
"or the Interest Deductions".
21. Section 6(c) thereof is amended by inserting the words "or the
Refunding Documents" immediately after the words "the Transaction Documents" and
immediately before the words "is required to pay".
22. Section 6(g) thereof is amended by inserting the words "the
Refunding Documents" immediately after the words "the Master Decommissioning
Trust Agreement," and immediately before the words "or the Transaction
Documents".
23. Section 6(k) thereof is amended by (i) inserting the words
"Refunding Documents," immediately after the words "the Transaction Documents,"
and immediately before the words "Plant Agreements"; (ii) inserting the words
"or the Refunding Documents"
4
immediately after the words "the Transaction Documents" and immediately before
the words ") failing to result".
24. Section 6(l) thereof is amended by inserting the words ", the
Refunding Documents," immediately after the words "the Transaction Documents"
and immediately before the words "or the Plant Agreements".
25. Section 8(b) thereof is amended by inserting the words "or the
Refunding Documents," immediately after the words "the Transaction Documents"
and immediately before the words "that the Owner Participant".
26. Section 8(e) thereof is amended by inserting the words "or the
Refunding Documents" immediately after the words "any of the Transaction
Documents" and immediately before the words ", or if and for so long as".
27. Section 20 thereof is amended by inserting the workds "or
Refunding Documents" immediately after the words "Transaction Documents" and
immediately before the period ending the section.
28. Section 21 thereof is amended by inserting the words "or
Refunding Documents" immediately after the words "Transaction Documents" and
immediately before the words "or to make any payments."
IN WITNESS WHEREOF, the Owner Participant and the Lessee have each
caused this TIA Amendment No. 1 to be duly executed in New York, New York by
their respective officers thereunto duly authorized as of the date first set
forth above.
THE UNITED ILLUMINATING COMPANY
_____________________________________
Name:
Title:
ATTEST: FINANCIAL LEASING CORPORATION
_________________________ _____________________________________
Name: Name:
Title: Title:
0
XXXXXXXXXXXXXX
XXXXX XX XXX XXXX )
) SS.:
COUNTY OF NEW YORK )
On this ____ day of _________, ____, before me, the undersigned
Notary Public, duly commissioned and qualified within the State and County
aforesaid, personally came and appeared _____________________, who being by me
duly sworn did say that he is a ___________________ of FINANCIAL LEASING
CORPORATION, a Massachusetts corporation, and that said instrument was signed on
behalf of said corporation by authority of its Board of Directors and that he
acknowledged said instrument to be the free act and deed of said corporation.
_______________________________
Notary Public
My Commission Expires:
_________ __, ____
ACKNOWLEDGMENT
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this ____ day of _________, ____, before me, the undersigned
Notary Public, duly commissioned and qualified within the State and County
aforesaid, personally came and appeared _____________________, who being by me
duly sworn did say that he is a ___________________ of THE UNITED ILLUMINATING
COMPANY, a Connecticut corporation, and that said instrument was signed on
behalf of said corporation by authority of its Board of Directors and that he
acknowledged said instrument to be the free act and deed of said corporation.
____________________________
Notary Public
My Commission Expires:
_________ __, ____
