Exhibit 4(c)
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SUPPLEMENTAL INDENTURE NO. 3
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TUCSON ELECTRIC POWER COMPANY
TO
BANK OF MONTREAL TRUST COMPANY,
TRUSTEE
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Dated as of August 1, 1998
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Supplemental to Indenture of Mortgage and Deed of Trust,
dated as of December 1, 1992
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Creating Series of Bonds Designated
First Mortgage Bonds, Collateral Series due 2008
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This instrument constitutes a mortgage, a deed of trust and a
security agreement.
SUPPLEMENTAL INDENTURE NO. 3, dated as of August 1, 1998,
between TUCSON ELECTRIC POWER COMPANY (hereinafter sometimes
called (the "Company"), a corporation organized and existing
under the laws of the State of Arizona, having its principal
office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, in the City of Tucson, Arizona,
as trustor, and BANK OF MONTREAL TRUST COMPANY, a banking
corporation organized and existing under the laws of the State of
New York and having its principal office at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, in
the Borough of Manhattan, The City of New York, New York, as
trustee (hereinafter sometimes called the "Trustee"), under the
Indenture of Mortgage and Deed of Trust, dated as of December 1,
1992 (hereinafter called the "Original Indenture"), as heretofore
supplemented, this Supplemental Indenture No. 3 being
supplemental thereto (the Original Indenture as heretofore
supplemented, and as supplemented hereby, and as it may from time
to time be further supplemented, modified, altered or amended by
any supplemental indenture entered into in accordance with and
pursuant to the provisions thereof, is hereinafter called the
"Indenture").
RECITALS OF THE COMPANY
WHEREAS the Original Indenture was authorized, executed and
delivered by the Company to provide for the issuance from time to
time of its Bonds (such term and all other capitalized terms used
herein without definition having the meanings assigned to them in
the Original Indenture), to be issued in one or more series as
therein contemplated, and to provide security for the payment of
the principal of and premium, if any, and interest, if any, on
the Bonds; and
WHEREAS, the Company has heretofore executed and delivered
to the Trustee two supplemental indentures for the purposes
recited therein including the creation of two series of Bonds, as
set forth in Schedule A hereto; and
WHEREAS, the Company proposes to establish a series of Bonds
designated "First Mortgage Bonds, Collateral Series due 2008",
such series to be limited in aggregate principal amount (except
as contemplated in clause (b) of Section 2 of Article II of the
Original Indenture) to $140,000,000, such series of Bonds and
such Bonds to be hereinafter sometimes called, respectively,
"Series 3" and "Series 3 Bonds"; and
WHEREAS, all acts and proceedings required by law and by the
articles of incorporation and by-laws of the Company, including
all action requisite on the part of its shareholders, directors
and officers, necessary to make the Series 3 Bonds, when executed
by the Company, authenticated and delivered by the Trustee and
duly issued, the valid, binding and legal obligations of the
Company, and to constitute this Supplemental Indenture a valid,
binding and legal instrument, in accordance with its and their
terms, have been done and taken; and the execution and delivery
of this Supplemental Indenture No. 3 have been in all respects
duly authorized.
GRANTING CLAUSES
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE NO. 3
WITNESSETH, that, in order to secure the payment of the principal
of and premium, if any, and interest, if any, on all Bonds at any
time Outstanding under the Indenture according to their tenor,
purport and effect, and to secure the performance and observance
of all the covenants and conditions therein and herein contained
(except any covenant of the Company with respect to the refund or
reimbursement of taxes, assessments or other governmental charges
on account of the ownership of the Bonds of any series or the
income derived therefrom, for which the Holders of the Bonds
shall look only to the Company and not to the property hereby
mortgaged or pledged), and to declare the terms and conditions
upon and subject to which the Series 3 Bonds are to be issued,
and for and in consideration of the premises and of the mutual
covenants herein contained and of the purchase and acceptance of
the Bonds by the Holders thereof, and of the sum of $1 duly paid
to the Company by the Trustee at or before the ensealing and
delivery hereof, and for other good and valuable consideration,
the receipt and sufficiency whereof are hereby acknowledged, the
Company has executed and delivered this Indenture, and by these
presents does grant, bargain, sell, release, convey, assign,
transfer, mortgage, pledge, set over and confirm unto the
Trustee, and grant to the Trustee a security interest in:
All and singular the premises, property, assets,
rights and franchises of the Company (except Excepted
Property), whether now or hereafter owned, constructed
or acquired, of whatever character and wherever
situated including, among other things (but reference
to or enumeration of any particular kinds, classes or
items of property shall not be deemed to exclude from
the operation and effect of this Indenture any kind,
class or item not so referred to or enumerated), all
right, title and interest of the Company in and to the
property described as granted in "Schedule B" attached
to this Supplemental Indenture No. 3 and made part of
these Granting Clauses to the same extent as if fully
set forth in the same, and all plants for the
generation of electricity by water, steam and/or other
power; all power houses, substations, transmission
lines, distributing systems; all offices, buildings and
structures, and the equipment thereof; all machinery,
engines, boilers, dynamos, machines, regulators,
meters, transformers, generators and motors; all
appliances whether electrical, gas or mechanical,
conduits, cables and lines; all pipes, service pipes,
fittings, valves and connections, poles, wires, tools,
implements, apparatus, furniture, and chattels; all
municipal franchises and other franchises; all lines
for the transmission and/or distribution of electric
current, including towers, poles, wires, cables, pipes,
conduits, street lighting systems and all apparatus for
use in connection therewith; all real estate, lands,
leaseholds; all easements, servitudes, licenses,
permits, rights, powers, franchises, privileges,
rights-of-way and other rights in or relating to real
estate or the occupancy of the same and all the right,
title and interest of the Company in and to all other
property of any kind or nature appertaining to and/or
used and/or occupied and/or enjoyed in connection with
any property hereinbefore described; it being the
intention of the parties that all property of every
kind, real, personal or mixed (including, but not
limited to, all property of the types hereinbefore
described), other than Excepted Property, which may be
acquired by the Company after the date hereof, shall,
immediately upon the acquisition thereof by the
Company, to the extent of such acquisition, and without
any further conveyance or assignment, become and be
subject to the direct lien of the Indenture as fully
and completely as though now owned by the Company and
described in said "Schedule B"; it further being the
intention of the paries, however, that the lien of and
security interest granted by this Indenture shall not
result in the Trustee having greater rights with
respect to any property of the Company, real, personal
or mixed (including, but not limited to, leasehold
interests in property) than the rights of the Company
with respect to such property.
TOGETHER WITH all and singular the tenements, hereditaments
and appurtenances belonging or in any wise appertaining to the
aforesaid premises, property, assets, rights and franchises or
any part thereof, with the reversion and reversions, remainder
and remainders, and all the estate, right, title and interest and
claim whatsoever, at law as well as in equity, which the Company
now has or may hereafter acquire in and to the aforesaid
premises, property, assets, rights and franchises and every part
and parcel thereof.
Subject, however, to the reservations, exceptions,
limitations and restrictions contained in the several deeds,
leases, servitudes, contracts, decrees, judgments, or other
instruments through which the Company acquired or claims title to
or enjoys the use of the aforesaid properties; and subject also
to such easements, leases, reservations, servitudes, reversions
and other rights and privileges of others and such mortgages,
liens and other encumbrances in, on, over, across or through said
properties as existed at the time of the acquisition of such
properties by the Company or as have been granted by the Company
to other persons at or prior to the time of the issuance and
delivery of the Bonds of the Initial Series, including, but not
limited to, the lien of the 1941 Mortgage and the security
interest created thereby; and subject also to Permitted En-
cumbrances and, as to any property acquired by the Company after
the time of the issuance and delivery of the Bonds of the Initial
Series, to any easements, leases, reservations, servitudes,
reversions and other rights and privileges of others and
mortgages, liens or other encumbrances thereon existing, and to
any mortgages, liens and other encumbrances for unpaid portions
of the purchase money placed thereon, at the time of such
acquisition, it being understood that with respect to any such
after-acquired property the Lien of the Indenture (as hereinafter
defined) shall at all times be junior, subject and subordinate to
the lien of the 1941 Mortgage and the security interest created
thereby; and subject also to the provisions of Article XI of the
Original Indenture;
TO HAVE AND TO HOLD the Trust Estate and all and singular
the lands, properties, estates, rights, franchises, privileges
and appurtenances hereby granted, bargained, sold, released,
conveyed, assigned, transferred, mortgaged, pledged, set over and
confirmed, together with all the appurtenances thereunto
appertaining, unto the Trustee and its successors and assigns,
forever;
BUT IN TRUST, NEVERTHELESS, for the equal and proportionate
use, benefit, security and protection of those who from time to
time shall hold the Bonds authenticated and delivered hereunder
and duly issued by the Company, without any discrimination,
preference or priority of any one Bond over any other by reason
of priority in the time of issue, sale or negotiation thereof or
otherwise, except as provided in Section 2 of Article IV of the
Original Indenture, so that, subject to said provisions, each and
all of said Bonds shall have the same right, lien and privilege
under the Indenture and shall be equally secured hereby (except
as any sinking, amortization, improvement, renewal or other fund,
established in accordance with the provisions of the Indenture,
may afford additional security for the Bonds of any particular
series), and shall have the same proportionate interest and share
in the Trust Estate, with the same effect as if all of the Bonds
had been issued, sold and negotiated simultaneously on the date
of the delivery hereof; and in trust for enforcing payment of the
principal of the Bonds, and premium, if any, and interest, if
any, thereon, according to the tenor, purport and effect of the
Bonds and of the Indenture, and for enforcing the terms,
provisions, covenants and agreements herein and in the Bonds set
forth;
UPON CONDITION that, until the happening of a Default, the
Company shall be suffered and permitted to possess, use and enjoy
the Trust Estate (except money, securities and other personal
property pledged or deposited with or required to be pledged or
deposited with the Trustee hereunder) and to receive and use the
rents, issues, income, revenues, earnings and profits therefrom,
all as more specifically provided in Section 1 of Article VII of
the Original Indenture;
AND UPON THE TRUSTS, USES AND PURPOSES and subject to the
covenants, agreements and conditions hereinafter set forth and
declared.
ARTICLE
SERIES 3 BONDS
SECTION 1. BASIC PROVISIONS.
There is hereby established a series of Bonds having the
following terms and characteristics (the lettered subdivisions
set forth below corresponding to the lettered subdivisions of
SECTION 2 of Article II of the Indenture):
(a) the title of the Bonds of such series, being
Series No. 3 under the Indenture, shall be "First Mortgage
Bonds, Collateral Series due 2008" (such Bonds being
hereinafter sometimes called the "Series 3 Bonds");
(b) the aggregate principal amount of Series 3 Bonds
which may be authenticated and delivered under the Indenture
shall be limited to $140,000,000, except as contemplated in
subdivision (b) of SECTION 2 of Article II of the Original
Indenture;
(c) not applicable;
(d) the Series 3 Bonds shall mature on August 1, 2008;
(e) the Series 3 Bonds shall not bear interest;
(f) the office of the Trustee in New York, New York,
shall be the office or agency of the Company in The City of
New York at which (i) the principal of the Series 3 Bonds
shall be payable upon presentation thereof, (ii)
registration of transfer of Series 3 Bonds may be effected,
(iii) exchanges of Series 3 Bonds may be effected and (iv)
notices, and demands to or upon the Company in respect of
the Series 3 Bonds or the Indenture may be served; provided,
however, that the Company reserves the right to change, by
written notice to the Trustee, such office or agency in The
City of New York; and provided, further, that the principal
office of the Company in Tucson, Arizona shall be an
additional financial office or agency where the principal of
the Series 3 Bonds shall be payable upon presentation
thereof;
(g) The Series 3 Bonds shall be redeemable at the
option of the Company, in whole at any time or in part from
time to time, at a redemption price equal to the principal
amount of the Series 3 Bonds to be redeemed;
(h) not applicable;
(i) the Series 3 Bonds shall be issued in
denominations of $1,000 and integral multiples thereof;
(j) not applicable;
(k) not applicable;
(l) not applicable;
(m) not applicable;
(n) not applicable;
(o) not applicable;
(p) not applicable;
(q) The Series 3 Bonds shall be issued and delivered
by the Company to Bank of Montreal Trust Company, as trustee
under the Indenture, to be dated as of August 1, 1998, as
supplemented (the "1998 Indenture"), of the Company to such
trustee (the "1998 Indenture Trustee"), in exchange for
obligations of the Company which have heretofore been
delivered to the 1998 Indenture Trustee, as the basis for
the authentication and delivery of securities under the 1998
Indenture. As provided in the 1998 Indenture, the Series 3
Bonds, when so issued and delivered, will be registered in
the name of the 1998 Indenture Trustee or its nominee and
will be owned and held by the 1998 Indenture Trustee,
subject to the provisions of the 1998 Indenture, for the
benefit of the holders of all securities from time to time
outstanding under the 1998 Indenture, and the Company shall
have no interest therein. The Series 3 Bonds shall not be
transferable except as required to effect transfer to any
successor trustee under the 1998 Indenture.
(r) not applicable;
(s) no service charge shall be made for the
registration of transfer or exchange of Series 3A Bonds;
provided, however, that the Company may require payment of a
sum sufficient to cover any tax or governmental charge
payable in connection with such transfer or exchange; and
(t) not applicable.
SECTION 2. ADDITIONAL PROVISIONS.
Set forth below in this SECTION 2 are additional terms of
the Series 3 Bonds, as contemplated by clause (u) in the first
paragraph of SECTION 1 of Article II of the Original Indenture.
(a) Anything herein to the contrary notwithstanding,
any payment by the Company under the 1998 Indenture of the
principal of the securities which shall have been
authenticated and delivered under the 1998 Indenture on the
basis of the delivery to the 1998 Indenture Trustee of
Series 3 Bonds (other than by the application of the
proceeds of a payment in respect of such Series 3 Bonds)
shall, to the extent thereof, be deemed to satisfy and
discharge the obligation of the Company, if any, to make a
payment of principal of such Series 3 Bonds which is then
due.
The Trustee shall be entitled to presume that the
obligation of the Company to pay the principal of the Series
3 Bonds as the same shall become due and payable, whether at
maturity, upon redemption or otherwise, shall have been
fully satisfied and discharged unless and until it shall
have received a written notice from the 1998 Indenture
Trustee, signed by an authorized officer thereof, stating
that the principal of specified Series 3 Bonds has become
due and payable and has not been fully paid, and specifying
the amount of funds required to make such payment.
(b) the Series 3 Bonds shall have such other terms,
and shall bear such restrictive legends, as are set forth in
the form of Series 3 Bond attached hereto as Exhibit A;
(c) if the Company shall make any deposit of money
and/or Government Obligations with respect to any Series 3
Bonds, or any portion of the principal amount thereof, as
contemplated by SECTION 1 of Article XV of the Original
Indenture, then the Company shall not deliver a Treasurer's
Certificate described in clause (z) in the first paragraph
of said SECTION 1 unless the Company shall also deliver to
the Trustee, together with such other Treasurer's
Certificate either:
i) an instrument wherein the Company,
notwithstanding the satisfaction and discharge of its
indebtedness in respect of the such Series 3 Bonds,
shall assume the obligation (which shall be absolute
and unconditional) to irrevocably deposit with the
Trustee such additional sums of money, if any, or
additional Government Obligations (meeting the
requirements of said SECTION 1 of Article XV), if any,
or any combination thereof, at such time or times, as
shall be necessary, together with the money and/or
Government Obligations theretofore so deposited, to pay
when due the principal of such Series 3 Bonds or
portions thereof, all in accordance with and subject to
the provisions of said SECTION 1; provided, however,
that such instrument may state that the obligation of
the Company to make additional deposits as aforesaid
shall be subject to the delivery to the Company by the
Trustee of a notice asserting the deficiency
accompanied by an opinion of an Independent public
accountant of nationally recognized standing showing
the calculation thereof (which opinion shall be
obtained at the expense of the Company); or
ii) an Opinion of Counsel to the effect that the
Holders of such Series 3 Bonds, or portions of the
principal amount thereof, will not recognize income,
gain or loss for United States federal income tax
purposes as a result of the satisfaction and discharge
of the Company's indebtedness in respect thereof and
will be subject to United States federal income tax on
the same amounts, at the same times and in the same
manner as if such satisfaction and discharge had not
been effected.
ARTICLE II.
AMENDMENTS
SECTION 1. CURRENT AMENDMENTS.
The Original Indenture is hereby amended as set forth
in Schedule C hereto.
SECTION 2. PROSPECTIVE AMENDMENTS.
The Holder of the Series 3 Bonds shall be deemed to
have consented to the execution and delivery of a supplemental
indenture containing one or more, or all, the amendments to the
Original Indenture set forth in Schedule D hereto.
ARTICLE III
MISCELLANEOUS PROVISIONS
This Supplemental Indenture No. 3 is a supplement to the
Original Indenture. As heretofore supplemented and further
supplemented by this Supplemental Indenture No. 3, the Original
Indenture is in all respects ratified, approved and confirmed,
and the Original Indenture as heretofore supplemented and this
Supplemental Indenture No. 3 shall together constitute one and
the same instrument.
IN WITNESS WHEREOF, Tucson Electric Power Company has caused
its corporate name to be hereunto affixed, and this instrument to
be signed by one of its Vice Presidents, and its corporate seal
to be hereunto affixed and attested by one of its Assistant
Secretaries for and in its behalf; and Bank of Montreal Trust
Company, in evidence of its acceptance of the trust hereby
created, has caused its corporate name to be hereunto affixed,
and this instrument to be signed by one of its Vice Presidents
and its corporate seal to be hereunto affixed and attested by one
of its Vice Presidents for and in its behalf, all as of the day
and year first above written.
TUCSON ELECTRIC POWER COMPANY
By
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Vice President
Attest:
--------------------------------
Assistant Secretary
BANK OF MONTREAL TRUST COMPANY,
Trustee
By --------------------------------
▇▇▇▇▇ ▇▇▇▇▇
Vice President
Attest:
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STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
This instrument was acknowledged before me this 3rd day of
August, 1998 by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, a Vice President of TUCSON
ELECTRIC POWER COMPANY, an Arizona corporation, known to me to be
the individual who executed this instrument, and known to me to
be a Vice President of said corporation, and who personally
acknowledged before me and stated that he executed said
instrument on behalf of said corporation for the purposes and
consideration therein expressed.
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NOTARY PUBLIC
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
This instrument was acknowledged before me this 3rd day of
August, 1998 by ▇▇▇▇▇ ▇▇▇▇▇, a Vice President of BANK OF MONTREAL
TRUST COMPANY, a New York banking corporation, known to me to be
the individual who executed this instrument, and known to me to
be a Vice President of said corporation, and who personally
acknowledged before me and stated that he executed said
instrument on behalf of said corporation for the purposes and
consideration therein expressed.
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SCHEDULE A
Supplemental Securities
Indenture of Series
No. Dated as of Series No. Designation
----------- ----------- ---------- -----------
1 December 1, 1 Second
1992 Mortgage
Bonds,
Collateral
Series A
2 December 1, 2 Second
1997 Mortgage
Bonds,
Collateral
Series B
Principal Amount
Authorized Issued(1) Outstanding(1)
---------- -------- -------------
$ 50,000,000 $ 50,000,000 None
$543,875,000 $543,875,000 $543,875,000
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(1) As of August 4, 1998.
SCHEDULE B
DESCRIPTION OF MORTGAGED PROPERTY
GENERIC DESCRIPTION
All electric generating plants, gas generating plant, gas
holders, steam plant, gas regulating stations, substations and
other properties of the Company, including all power houses,
transmission lines, buildings, pipes, structures and works, and
the lands of the Company on which the same are situated, and all
the Company's lands, easements, rights, rights-of-way, water
rights, rights to the use of water, including all of the
Company's right, title and interest in and to any and all decrees
therefor, permits, franchises, consents, privileges, licenses,
poles, towers, wires, switch racks, insulators, pipes, machinery,
engines, boilers, motors, regulators, meters, tools, appliances,
equipment, appurtenances and supplies, forming a part of or
appertaining to said plants, holders, sites, stations or other
properties, or any of them, or used or enjoyed, or capable of
being used or enjoyed in conjunction or connection therewith; and
All electric substations and substation sites of the Company
including all buildings, structures, towers, poles, lines, and
all equipment, appliances and devices for transforming,
converting and distributing electric energy, and all the right,
title and interest of the Company in and to the land on which the
same are situated, and all of the Company's lands, easements,
rights-of-way, rights, franchises, privileges, machinery,
equipment, fixtures, appliances, devices, appurtenances and
supplies forming a part of said substation or any of them, or
used or enjoyed, or capable of being used or enjoyed, in
conjunction or connection therewith; and
All warehouses, buildings, structures, works and sites and
the Company's lands on which the same are situated, and all
easements, rights-of-way, permits, franchises, consents,
privileges, licenses, machinery, equipment, furniture and
fixtures, appurtenances and supplies forming a part of said
warehouses, buildings, structures, works and sites, or any of
them, or used or enjoyed or capable of being used or enjoyed in
connection or conjunction therewith; and
All electric distribution systems of the Company, including
towers, poles, wires, insulators, appliances, devices,
appurtenances and equipment, and all the Company's other
property, real, personal or mixed, forming a part of, or used,
occupied or enjoyed in connection with or in any way appertaining
to said distribution systems, or any of them, together with all
of the Company's rights-of-way, easements, permits, privileges,
municipal or other franchises, licenses, consents and rights for
or relating to the construction, maintenance or operation thereof
through, over, under or upon any public streets or highways, or
public or private lands; and also all branches, extensions,
improvements and developments of or appertaining to or connected
with said electric distribution systems, or any of them, and all
other electric distribution systems of the Company and parts
thereof wherever situated, and whether now owned or hereafter
acquired, as well as all rights-of-way, easements, privileges,
permits, municipal or other franchises, consents and rights for
or relating to the construction, maintenance or operation
thereof, or any part thereof, through, over, under or upon public
or private lands, whether now owned or hereafter acquired; and
All electric transmission and/or distribution lines of the
Company, including the towers, poles, pole lines, wires, switch
racks, insulators, supports, guys, telephone and telegraph lines
and other appliances and equipment, and all other property of the
Company, real, personal or mixed, forming a part thereof or
appertaining thereto, together with all of the Company's rights-
of-way, easements, permits, privileges, municipal or other
franchises, consents, licenses and rights, for or relating to the
construction, maintenance or operation thereof, through, over,
under or upon any public streets or highways or other lands,
public or private; also all extension, branches, taps,
developments and improvements of or to any and all of the above
described transmission and/or distribution lines, telephone and
telegraph lines or any of them, as well as all rights-of-way,
easements, permits, privileges, rights and municipal or other
franchises, licenses and consents, for or relating to the
construction, maintenance or operation of said lines or any of
them, or any part thereof, through, over, under or upon any
public streets or highways or any public or private lands,
whether now owned or hereafter acquired;
Excepting, however, any property of the character of
"Excepted Property" within the meaning of the Supplemental
Indenture to which this Schedule A is attached.
SPECIFIC DESCRIPTION OF ADDITIONAL REAL PROPERTY
[None]
SCHEDULE C
CURRENT AMENDMENTS TO ORIGINAL INDENTURE
(1)(a) SECTION 2 of Article II of the Original Indenture
is hereby amended to read as follows:
SECTION 2. BONDS ISSUABLE IN SERIES.
The Bonds may be issued in one or more series. Subject
to the next succeeding paragraph of this SECTION, there
shall be established by specification in a supplemental
indenture or in a Certified Resolution, or in a Treasurer's
Certificate pursuant to a supplemental indenture or a
Certified Resolution:
(a) the title of the Bonds of such series (which
shall distinguish the Bonds of such series from Bonds
of all other series);
(b) any limit upon the aggregate principal amount
of the Bonds of such series which may be authenticated
and delivered under this Indenture (except for Bonds
authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other
Bonds of such series pursuant to SECTION 6, SECTION 10
or SECTION 11 of this Article, SECTION 6 of Article V
or SECTION 6 of Article XIII and except for any Bonds
which, pursuant to SECTION 12 of this Article, are
deemed never to have been authenticated and delivered
hereunder);
(c) the Persons (without specific identification)
to whom interest on Bonds of such series, or any
Tranche thereof, shall be payable on any Interest
Payment Date, if other than the Persons in whose names
such Bonds (or one or more Predecessor Bonds) are
registered at the close of business on the Regular
Record Date for such interest;
(d) the date or dates on which the principal of
the Bonds of such series, or any Tranche thereof, is
payable or any formulary or other method or other means
by which such date or dates shall be determined, by
reference to an index or other fact or event
ascertainable outside of this Indenture or otherwise
(without regard to any provisions for redemption,
prepayment, acceleration, purchase or extension); and
the right, if any, to extend the Maturity of the Bonds
of such series, or any Tranche thereof, and the
duration of any such extension;
(e) the rate or rates at which the Bonds of such
series, or any Tranche thereof, shall bear interest, if
any (including the rate or rates at which overdue
principal shall bear interest, if different from the
rate or rates at which such Bonds shall bear interest
prior to Maturity, and, if applicable, the rate or
rates at which overdue premium or interest shall bear
interest, if any), or any formulary or other method or
other means by which such rate or rates shall be
determined, by reference to an index or other fact or
event ascertainable outside of this Indenture or
otherwise; the date or dates from which such interest
shall accrue; the Interest Payment Dates on which such
interest shall be payable and the Regular Record Date,
if any, for the interest payable on such Bonds on any
Interest Payment Date; the basis of computation of
interest, if other than as provided in SECTION 8 of
this Article; and the right, if any, to extend the
interest payment periods and the duration of any such
extension;
(f) the place or places at which and/or the
methods (if other than as provided elsewhere in this
Indenture) by which (i) the principal of and premium,
if any, and interest, if any, on Bonds of such series,
or any Tranche thereof, shall be payable, (ii)
registration of transfer of Bonds of such series, or
any Tranche thereof, may be effected, (iii) exchanges
of Bonds of such series, or any Tranche thereof, may be
effected and (iv) notices and demands to or upon the
Company in respect of the Bonds of such series, or any
Tranche thereof, and this Indenture may be served; and,
if such is the case, that the principal of such Bonds
shall be payable without the presentment or surrender
thereof;
(g) the period or periods within which or the
date or dates on which, the price or prices at which
and the terms and conditions upon which the Bonds of
such series, or any Tranche thereof, may be redeemed,
in whole or in part, at the option of the Company;
(h) the obligation or obligations, if any, of the
Company to redeem or purchase the Bonds of such series,
or any Tranche thereof, pursuant to any sinking fund or
other mandatory redemption provisions or at the option
of a Holder thereof and the period or periods within
which or the date or dates on which, the price or
prices at which and the terms and conditions upon which
such Bonds shall be redeemed or purchased, in whole or
in part, pursuant to such obligation, and applicable
exceptions to the requirements of SECTION 4 of Article
IV in the case of mandatory redemption or redemption at
the option of the Holder;
(i) the denominations in which Bonds of such
series, or any Tranche thereof, shall be issuable if
other than denominations of One Thousand Dollars
($1,000) and any integral multiple thereof;
(j) the currency or currencies, including com-
posite currencies, in which payment of the principal of
and premium, if any, and interest, if any, on the Bonds
of such series, or any Tranche thereof, shall be
payable (if other than in Dollars); and the formulary
or other method or other means by which the equivalent
of any such amount in Dollars is to be determined for
any purpose, including for the purpose of determining
the principal amount of such Bonds deemed to be
Outstanding at any time; it being understood that, for
purposes of calculations under this Indenture
(including calculations under Articles I and III), any
amounts denominated in a currency other than Dollars or
in a composite currency shall be converted to Dollar
equivalents by calculating the amount of Dollars which
could have been purchased by the amount of such other
currency based on such quotations or methods of
determination as shall be specified pursuant to this
clause; provided, however, that the instrument
establishing the Bonds of such series or Tranche shall
contain provisions substantially to the effect that if,
at any time when the principal of such Bonds, together
with premium, if any, and accrued interest, if any,
thereon, shall be due and payable or at any time when
there shall be a determination by a court of competent
jurisdiction of the extent to which the obligations of
the Company in respect of the Bonds then Outstanding or
otherwise under this Indenture are deemed to be secured
obligations of the Company, the amount of Dollars into
which an amount equal to the principal of such Bonds
could be converted under then current currency exchange
rates exceeds the amount of Dollars into which an
amount equal to the principal of such Bonds have been
converted under currency exchange rates prevailing at
the time of the initial authentication and delivery of
such Bonds, then the Company's obligation to pay such
excess amount in respect of principal, together with
the associated excess amounts in respect of premium, if
any, and accrued interest, if any, shall be deemed to
be secured by and entitled to the benefit of the Lien
of this Indenture only to the extent that any proceeds
of sale of the Trust Estate and/or any other assets of
the Company subject to such Lien shall exceed the
amount necessary to pay, satisfy and discharge, or duly
provide therefor, all other obligations of the Company
on the Bonds then Outstanding or otherwise under this
Indenture; and, to the extent of any inconsistency
between such provisions so contained in such instrument
and any other provision of this Indenture, such
provisions of such instrument shall control;
(k) if the principal of or premium, if any, or
interest, if any, on the Bonds of such series, or any
Tranche thereof, are to be payable, at the election of
the Company or a Holder thereof, in a coin or currency
other than that in which the Bonds are stated to be
payable, the coin or currency in which payment of any
amount as to which such election is made will be
payable, the period or periods within which, and the
terms and conditions upon which, such election may be
made; it being understood that, for purposes of
calculations under this Indenture (including
calculations under Articles I and III), any such
election shall be required to be taken into account, in
the manner contemplated in clause (j) of this
paragraph, only after such election shall have been
made; provided, however, the instrument establishing
the Bonds of such series or Tranche shall contain
provisions having substantially the same effect as the
provisions described in the proviso to clause (j) of
this paragraph;
(l) if the principal of or premium, if any, or
interest, if any, on the Bonds of such series, or any
Tranche thereof, are to be payable, or are to be
payable at the election of the Company or a Holder
thereof, in securities or other property, the type and
amount of such securities or other property, or the
formulary or other method or other means by which such
amount shall be determined, and the period or periods
within which, and the terms and conditions upon which,
any such election may be made; it being understood that
all calculations under this Indenture (including
calculations under Articles I and III) shall be made on
the basis of the fair market value of such securities
or the fair value of such other property, in either
case determined as of the most recent practicable date,
except that, in the case of any amount of principal or
interest that may be so payable at the election of the
Company or a Holder, if such election shall not yet
have been made, such calculations shall be made on the
basis of the amount of principal or interest, as the
case may be, that would be payable if no such election
were made; provided, however, the instrument
establishing the Bonds of such series or Tranche shall
contain provisions having substantially the same effect
as the provisions described in the proviso to clause
(j) of this paragraph;
(m) if the amount payable in respect of principal
of or premium, if any, or interest, if any, on the
Bonds of such series, or any Tranche thereof, may be
determined with reference to an index or other fact or
event ascertainable outside of this Indenture, the
manner in which such amounts shall be determined (to
the extent not established pursuant to clause (e) of
this paragraph); it being understood that all
calculations under this Indenture (including
calculations under Articles I and III) shall be made on
the basis of the amount that would be payable as
principal if such principal were due, or on the basis
of the interest rates in effect, as the case may be, on
the date next preceding the date of such calculation;
provided, however, the instrument establishing the
Bonds of such series or Tranche shall contain
provisions having substantially the same effect as the
provisions described in the proviso to clause (j) of
this paragraph;
(n) if other than the principal amount thereof,
the portion of the principal amount of Bonds of such
series, or any Tranche thereof, which shall be payable
upon declaration of acceleration of the Maturity
thereof pursuant to SECTION 3 of Article VIII;
(o) the terms, if any, pursuant to which the
Bonds of such series, or any Tranche thereof, may be
converted into or exchanged for shares of capital stock
or other securities of the Company or any other Person;
(p) the obligations or instruments, if any, which
shall be considered to be Eligible Obligations in
respect of the Bonds of such series, or any Tranche
thereof, denominated in a currency other than Dollars
or in a composite currency, and any additional or
alternative provisions for the reinstatement of the
Company's indebtedness in respect of such Bonds after
the satisfaction and discharge thereof as provided in
SECTION 1 of Article XV;
(q) if the Bonds of such series, or any Tranche
thereof, are to be issued in global form, (i) any
limitations on the rights of the Holder or Holders of
such Bonds to transfer or exchange the same or to
obtain the registration of transfer thereof, (ii) any
limitations on the rights of the Holder or Holders
thereof to obtain certificates therefor in definitive
form in lieu of temporary form and (iii) any and all
other matters incidental to such Bonds;
(r) if the Bonds of such series, or any Tranche
thereof, are to be issuable as bearer securities, any
and all matters incidental thereto which are not
specifically addressed in a supplemental indenture as
contemplated by clause (f) of SECTION 2 of Article
XIII;
(s) to the extent not established pursuant to
clause (q) of this paragraph, any limitations on the
rights of the Holders of the Bonds of such Series, or
any Tranche thereof, to transfer or exchange such Bonds
or to obtain the registration of transfer thereof; and
if a service charge will be made for the registration
of transfer or exchange of Bonds of such series, or any
Tranche thereof, the amount or terms thereof;
(t) any exceptions to SECTION 13 of Article XVI
with respect to the Bonds of such series, or any
Tranche thereof; and
(u) any other terms of the Bonds of such series,
or any Tranche thereof.
With respect to Bonds of a series subject to a Periodic
Offering, the indenture supplemental hereto, Certified
Resolution or Treasurer's Certificate which establishes such
series may provide general terms or parameters for Bonds of
such series and provide either that the specific terms of
Bonds of such series, or any Tranche thereof, shall be
specified in a Written Order or that such terms shall be
determined by the Company or its agents in accordance with
procedures specified therein or to be specified in a Written
Order.
The form of the Bonds of each series, or any Tranche
thereof, shall be set forth in a supplemental indenture,
Certified Resolution or Treasurer's Certificate.
(b) SECTION 1 of Article I of the Original Indenture
is hereby amended to include therein the following additional
definitions:
"DOLLAR" or "$" shall mean a dollar or other equivalent
unit in such coin or currency of the United States of
America as at the time shall be legal tender for the payment
of public and private debts.
"ELIGIBLE OBLIGATIONS" shall mean:
(a) with respect to Bonds denominated in Dollars,
Government Obligations; or
(b) with respect to Bonds denominated in a
currency other than Dollars or in a composite currency,
such other obligations or instruments as shall be
specified with respect to such Securities as
contemplated by SECTION 2 of Article II.
"INTEREST PAYMENT DATE", when used with respect to any
Bond, shall mean the Stated Maturity of an installment of
interest on such Bond.
"MATURITY", when used with respect to any Bond, shall
mean the date on which the principal of such Bond or an
installment of principal becomes due and payable as provided
in such Bond or in this Indenture, whether at the stated
maturity, by declaration of acceleration, upon call for
redemption or otherwise.
"STATED MATURITY", when used with respect to any
obligation or any installment of principal thereof or
interest thereon, shall mean the date on which the principal
of such obligation or such installment of principal or
interest is stated to be due and payable (without regard to
any provisions for redemption, prepayment, acceleration,
purchase or extension).
(c) Article XV of the Original Indenture is hereby
amended by substituting the term "Eligible Obligations" for the
term "Government Obligations" wherever in such Article the latter
term currently appears.
(2) The definition of the term "Retired Bond" in SECTION 2
of Article I of the Original Indenture is hereby amended to read
as follows:
"RETIRED BOND" shall mean, as of any time, (a) any Bond
authenticated and delivered under this Indenture which no
longer remains Outstanding by reason of the applicability of
clause (a) or (b) in the definition of "OUTSTANDING" (other
than any Predecessor Bond of any Bond), provided, however,
that no Bond which shall have ceased to be Outstanding prior
to the Initial Certification Date shall be deemed to be a
Retired Bond unless such Bond shall have been included in
the Initial Engineer's Certificate as if such Bond had been
Outstanding at the Initial Certification Date; and (b) any
bond authenticated and delivered under the 1941 Mortgage
which at such time could be used as the basis for the
authentication and delivery of additional bonds pursuant to
SECTION 7 of Article III of the 1941 Mortgage, provided,
however, that (x) no bond which shall have ceased to be
"outstanding" under the 1941 Mortgage prior to the Initial
Certification Date shall be deemed to be a Retired Bond
unless such bond shall have been included in the Initial
Engineer's Certificate as if such bond had been
"outstanding" at the Initial Certification Date and (y) any
bond which shall have ceased to be "outstanding" under the
1941 Mortgage on or after the Initial Certification Date and
could otherwise have been used under SECTION 7 of Article
III of the 1941 Mortgage shall be deemed to be a Retired
Bond notwithstanding any subsequent satisfaction and
discharge of the 1941 Mortgage.
(3) Subdivision (9) of SECTION 6 of Article III of the
Original Indenture is hereby amended to read as follows:
(9) An Engineer's Certificate, made and dated not more
than 10 days prior to the date of such application, stating
that the signers have no knowledge of and do not believe
that there have been, since the close of the period covered
by the Engineer's Certificate specified in subdivision (3)
above, Property Retirements in an amount which (after
reduction of such amount by amounts of the character
referred to in Clause (D) of subdivision 3 in respect of
such Property Retirements) exceeds the amount of Property
Additions since the close of such period by more than the
amount of the Unapplied Balance of Property Additions
calculated to be remaining upon the granting of the
application (before any reduction of such Unapplied Balance
of Property Additions by any amount of Net Property
Additions applied to the withdrawal of cash deposited with
the Trustee in connection with such Property Retirements).
(4) Subdivision (2) of SECTION 7 of Article III of the
Original Indenture is hereby amended to read as follows:
(2) A Treasurer's Certificate stating (a) that the
Company is not to the best of the knowledge and belief of
the signers in default under any of the provisions of this
Indenture and (b) that Bonds theretofore authenticated an
delivered under this Indenture, and/or bonds, theretofore
authenticated and delivered under the 1941 Mortgage, of a
specified aggregate principal amount (not less than the
aggregate principal amount of Bonds for which such request
for authentication and delivery is made under this SECTION)
constitute Retired Bonds; and further stating that no part
of such Retired Bonds has been theretofore made the basis
under any of the provisions of this Indenture or the 1941
Mortgage for the authentication and delivery of Bonds
hereunder or bonds under the 1941 Mortgage, or the
withdrawal of cash or the release of any property and that
none of such Retired Bonds has been retired by the use of
the proceeds of any insurance on any Funded Property (or
"funded property" under the 1941 Mortgage) or the proceeds
of the release or other disposition of any part of the
Funded Property (or "funded property" under the 1941
Mortgage), or through the operation of any sinking fund or
other fund applicable to the retirement thereof, except to
the extent, if any, that the provisions establishing such
fund expressly permit the issuance of (x) Bonds under this
SECTION in respect of Bonds retired through the operation of
such fund or (y) bonds under SECTION 7 of Article III of the
1941 Mortgage in respect of bonds retired through the
operation of such fund; and further stating the interest
rate or rates and the maturity date or dates borne by all
such Retired bonds.
(5) SECTION 2 of Article XIII of the Original Indenture is
hereby amended to add at the end thereof a new paragraph reading
as follows:
Anything in this Indenture to the contrary
notwithstanding, if the instrument creating the Bonds of any
series or Tranche shall so provide, (a) the Holders of such
Bonds shall be deemed to have consented to a supplemental
indenture containing the additions, changes or eliminations
to or from the Indenture which shall be specified in such
instrument, (b) no action on the part of such Holders shall
be required to evidence such consent and (c) such consent
may be counted in the determination of whether or not the
Holders of the requisite principal amount of Bonds shall
have consented to such supplemental indenture.
(6) Subsection (d) of SECTION 8 of Article XIV of the
Original Indenture is hereby amended adding at the end thereof
the following:
Any such request, demand, authorization, direction, notice,
consent, waiver or other act, given or made as aforesaid,
shall be effective whether or not the Holders which
authorized or agreed or consented to the same remain Holders
after such record date and whether or not the Bonds held by
such Holders remain Outstanding after such record date.
SECTION 1 of Article XV of the Original Indenture is
hereby amended by:
(a) deleting the word "and" from the end of clause (x)
in the first paragraph thereof;
(b) deleting the period at the end of clause (y) in
the first paragraph thereof and adding at the end of clause (y)
"; and";
(c) adding a new clause (z) at the end of the first
paragraph reading as follows:
(z) if such deposit shall have been made prior to
the maturity or redemption date of such Bonds, a
Treasurer's Certificate stating the Company's intention
that, upon delivery of such Treasurer's Certificate,
its indebtedness in respect of such Bonds or portions
thereof will have been satisfied and discharged as
contemplated in this SECTION.
(d) deleting the second paragraph thereof and
substituting therefor a new second paragraph reading as follows:
Upon receipt by the Trustee of money or Eligible
Obligations, or both, in accordance with this SECTION, together
with the documents required by clauses (x), (y) and (z) above,
the Trustee shall, upon Written Request, acknowledge in writing
that such Bonds or portions thereof are deemed to have been paid
for all purposes of this Indenture and that the entire
indebtedness of the Company in respect thereof has been satisfied
and discharged as contemplated in this SECTION. In the event
that all of the conditions set forth in the preceding paragraph
shall have been satisfied in respect of any Bonds or portions
thereof except that, for any reason, the Treasurer's Certificate
specified in clause (z) (if otherwise required) shall not have
been delivered, such Bonds or portions thereof shall nevertheless
be deemed to have been paid for all purposes of this Indenture,
and the Holders of such Bonds or portions thereof shall
nevertheless be no longer entitled to the benefit of the Lien of
this Indenture or of any of the covenants of the Company under
Article IV (except the covenants contained in SECTIONs 2, 3 and 4
thereof) or any other covenants made in respect of such Bonds or
portions thereof, but the indebtedness of the Company in respect
of such Bonds or portions thereof shall not be deemed to have
been satisfied and discharged for any other purpose; and, upon
Written Request, the Trustee shall acknowledge in writing that
such Bonds or portions thereof are deemed to have been paid for
all purposes of this Indenture.
(7) SECTION 1 of Article VIII of the Original Indenture is
hereby amended to:
(a) insert "; or" at the end of clause (f) therein;
and
(b) add immediately following clause (f) the
following:
"(g) so long as the trustee under the
Indenture, dated as of August 1, 1998 as the
same may be amended and supplemented (the
`1998 Indenture'), from the Company to Bank
of Montreal Trust Company, as trustee (the
`1998 Indenture Trustee'), shall hold any
bonds outstanding hereunder which were
delivered to the 1998 Indenture Trustee as
the basis for the authentication and delivery
of securities under the 1998 Indenture which
remain outstanding thereunder, an `Event of
Default' under the 1998 Indenture; provided,
however, that, anything in this Indenture to
the contrary notwithstanding, the waiver or
cure of such `Event of Default' and the
rescission and annulment of the consequences
thereof shall constitute a cure of the
corresponding default under Indenture and a
rescission and annulment of the consequences
thereof."
SCHEDULE D
PROSPECTIVE AMENDMENTS TO ORIGINAL INDENTURE
1. The amendment of SECTION 2 of Article I of the
Original Indenture to add thereto a definition of the term
"fair value" substantially to the following effect:
"FAIR VALUE", with respect to property, means the
fair value of such property as may be determined by
reference to (a) the amount which would be likely to be
obtained in an arm's-length transaction with respect to
such property between an informed and willing buyer and
an informed and willing seller, under no compulsion,
respectively, to buy or sell, (b) the amount of
investment with respect to such property which,
together with a reasonable return thereon, would be
likely to be recovered through ordinary business
operations or otherwise, (c) the Cost, accumulated
depreciation and replacement cost with respect to such
property and/or (d) any other relevant factors;
provided, however, that (x) the fair value of property
shall be determined without deduction for any Prior
Liens on such property (except as otherwise provided in
clause (2) of subparagraph (C) of SECTION 3 of Article
VII and (y) the fair value to the Company of Property
Additions shall not reflect any reduction relating to
the fact that such Property Additions may be of less
value to a Person which is not the owner or operator of
the Mortgaged Property or any portion thereof than to a
Person which is such owner or operator. Fair value may
be determined, without physical inspection, by the use
of accounting and engineering records and other data
maintained by the Company or otherwise available to the
Engineer certifying the same.
2. The amendment of SECTION 2 of Article I of the
Original Indenture to add thereto definitions of the terms
"purchase money mortgage" and "purchase money obligations"
substantially to the following effect:
"PURCHASE MONEY MORTGAGE" means, with respect to
any property being acquired or disposed of by the
Company or being released from the Lien of this
Indenture, a lien on such property which
(a) is taken or retained by the transferor of
such property to secure all or part of the
purchase price thereof;
(b) is granted to one or more Persons other
than the transferor which, by making advances or
incurring an obligation, give value to enable the
grantor of such lien to acquire rights in or the
use of such property;
(c) is granted to any other Person in
connection with the release of such property from
the Lien of this Indenture on the basis of the
deposit with the Trustee or the trustee or other
holder of a Prior Lien of obligations secured by
such lien on such property (as well as any other
property subject thereto);
(d) is held by a trustee or agent for the
benefit of one or more Persons described in clause
(a), (b) and/or (c) above, provided that such lien
may be held, in addition, for the benefit of one
or more other Persons which shall have theretofore
given, or may thereafter give, value to or for the
benefit or account of the grantor of such lien for
one or more other purposes; or
(e) otherwise constitutes a purchase money
mortgage or a purchase money security interest
under applicable law;
and, without limiting the generality of the foregoing,
for purposes of this Indenture, the term shall be
deemed to include any lien described above whether or
not such lien (x) shall permit the issuance or other
incurrence of additional indebtedness secured by such
lien on such property, (y) shall permit the subjection
to such lien of additional property and the issuance or
other incurrence of additional indebtedness on the
basis thereof and/or (z) shall have been granted prior
to the acquisition, disposition or release of such
property, shall attach to or otherwise cover property
other than the property being acquired, disposed of or
released and/or shall secure obligations issued prior
and/or subsequent to the issuance of the obligations
delivered in connection with such acquisition,
disposition or release. The term "PURCHASE MONEY
OBLIGATION" shall mean an obligation secured by a
purchase money lien.
3. The amendment of clause (b) in subdivision (1) of
SECTION 9 of Article VII or the Original Indenture to read
as follows:
(b) in an amount equal to ten-sevenths
(10/7ths) of the principal amount of Bonds to the
authentication and delivery of which the Company
is entitled under the provisions of SECTION 7 of
Article III hereof.
4. The amendment of subparagraph E in the first
paragraph of SECTION 3 of Article VIII of the Original
Indenture to:
(i) to delete therefrom the second proviso or to
provide that the second proviso may be disregarded upon
specified conditions; or
(ii) to delete from the second proviso therein the
phrase "fifteen per centum (15%) of "; or
(iii) to change the phrase "fifteen per centum
(15%)" in the second proviso therein to any higher
percentage not exceeding one hundred per centum (100%).
5. The amendment of SECTION 7 of Article III of the
Original Indenture to change the semi-colon at the end of clause
(5) in the first paragraph thereof to a period and to delete the
remainder of said first paragraph.
EXHIBIT A
[Form of Bond]
(See legends at the end of this
Bond for restrictions on transfer.)
No. --------------- $-----------
TUCSON ELECTRIC POWER COMPANY
FIRST MORTGAGE BOND, COLLATERAL SERIES DUE 2008
DUE AUGUST 1, 2008
TUCSON ELECTRIC POWER COMPANY, a corporation of the State of
Arizona (hereinafter sometimes called the Company), for value
received, promises to pay to
or registered assigns, the principal sum of DOLLARS
on August 1, 2008, in coin or currency of the United States of
America which at the time of payment shall be legal tender for
the payment of public and private debts, at the office or agency
of the Company in The City of New York, or in the City of Tucson,
Arizona, upon presentation hereof. This Bond shall not bear
interest.
This bond is one of an issue of bonds of the Company, issued
and to be issued in one or more series under and equally and
ratably secured (except as any sinking, amortization,
improvement, renewal or other fund, established in accordance
with the provisions of the indenture hereinafter mentioned, may
afford additional security for the bonds of any particular
series) by the Indenture of Mortgage and Deed of Trust, dated as
of December 1, 1992 (the "Original Indenture"), from the Company
to Bank of Montreal Trust Company, trustee (the "Trustee"), as
supplemented by various supplemental indentures including
Supplemental Indenture No. 3, dated as of August 1, 1998 (the
Original Indenture, as so supplemented, and such Supplemental
Indenture being hereinafter called the "Indenture" and
"Supplemental Indenture No. 3", respectively), to which Indenture
reference is hereby made for a description of the property
mortgaged and pledged, the nature and extent of the security
provided by the Indenture, the rights and limitations of rights
of the Company, the Trustee and the holders of said bonds with
respect to the security provided by the Indenture, the powers,
duties and immunities of the Trustee, the terms and conditions
upon which such bonds are and are to be secured, and the
circumstances under which additional bonds may be issued.
The acceptance of this bond shall be deemed to constitute the
consent and agreement by the holder hereof to all of the terms
and provisions of the Indenture. This bond is one of a series of
bonds designated as the First Mortgage Bonds, Collateral Series
due 2008, of the Company.
The Indenture permits, with certain exceptions as therein
provided, the Trustee to enter into one or more supplemental
indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of,
the Indenture with the consent of the holders of not less than
sixty per centum (60%) in aggregate principal amount of the bonds
of all series then outstanding under the Indenture, considered as
one class; provided, however, that if there shall be bonds of
more than one series outstanding under the Indenture and if 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 bonds in
aggregate principal amount of the outstanding bonds of all series
so directly affected, considered as one class, shall be required;
and provided, further, that if the bonds of any series shall have
been issued in more than one tranche and if the proposed
supplemental indenture shall directly affect the rights of the
holder of bonds of one or more, but less than all, of such
tranches, then the consent only of the holders of bonds in
aggregate principal amount of the outstanding bonds of all
tranches so directly affected, considered as one class, shall be
required; and provided, further, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for
limited purposes without the consent of any holders of bonds.
Any such consent 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 therefor or in lieu hereof, whether or not
notation of such consent is made upon this bond. The holders of
this bond shall be deemed to have consented to certain amendments
to the Indenture which are specified in Supplemental Indenture
No. 3.
The bonds of this series are being issued and delivered by
the Company to Bank of Montreal Trust Company, as trustee under
the Indenture, dated as of August 1, 1998, as supplemented (the
"1998 Indenture"), of the Company to such trustee (the "1998
Indenture Trustee"), in exchange for other obligations of the
Company which have heretofore been delivered to the 1998
Indenture Trustee, as the basis for the authentication and
delivery of securities under the 1998 Indenture. As provided in
the 1998 Indenture, the bonds of this series are to be registered
in the name of the 1998 Indenture Trustee or its nominee and will
be owned and held by the 1998 Indenture Trustee, subject to the
provisions of the 1998 Indenture, for the benefit of the holders
of all securities from time to time outstanding under the 1998
Indenture, and the Company shall have no interest therein. The
bonds of this series shall not be transferable except as required
to effect transfer to any successor trustee under the 1998
Indenture.
Anything herein to the contrary notwithstanding, any payment
by the Company under the 1998 Indenture of the principal of the
securities which shall have been authenticated and delivered
under the 1998 Indenture on the basis of the delivery to the 1998
Indenture Trustee of bonds of this series (other than by the
application of the proceeds of a payment in respect of such bonds
of this series) shall, to the extent thereof, be deemed to
satisfy and discharge the obligation of the Company, if any, to
make a payment of principal of such bonds of this series which is
then due.
The bonds of this series are redeemable prior to maturity at
the option of the Company, as a whole at any time or in part from
time to time, at the principal amount of bonds so to be redeemed.
Notice of redemption shall be given by mail to the holders
of bonds of this series, not less than 30 nor more than 60 days
prior to the redemption date. As provided in the Indenture,
notice of redemption may state that such redemption shall be
conditional upon the receipt by the Trustee, on or prior to the
date fixed for redemption, of money sufficient to pay the
principal of this bond; a notice of redemption so conditioned
shall be of no force or effect if such money is not so received
and, in such event, the Company shall not be required to redeem
this bond.
In the event of redemption of this bond in part only, a new
bond or bonds of this series, of like tenor, for the unredeemed
portion hereof will be issued to the holder hereof upon the
surrender hereof.
The principal of this bond may become or be declared due and
payable before the stated maturity hereof, on the conditions, in
the manner and at the times set forth in the Indenture, upon the
happening of a default as therein provided.
This bond is non-transferable except as required to effect
transfer to any successor trustee under the 1998 Indenture, any
such transfer to be registered at the office or agency of the
Company in The City of New York, upon surrender of this bond by
the registered owner hereof or by attorney authorized in writing,
and upon any such registration of transfer a new bond of this
series, for the same aggregate principal amount and having the
same stated maturity date, will be issued to the transferee in
exchange herefor. Prior to due presentment for registration of
transfer, the Company and the Trustee may deem and treat the
person in whose name this bond is registered as the absolute
owner hereof for the purpose of receiving payment and for all
other purposes. This bond, alone or with other bonds of this
series, may in like manner be exchanged at such office or agency
for one or more bonds of this series of the same aggregate
principal amount and having the same stated maturity date and
interest rate, all as provided in the Indenture.
As provided in the Indenture and subject to certain
limitations therein set forth, this Bond or any portion of the
principal amount hereof will be deemed to have been paid for all
purposes of the Indenture and to be no longer Outstanding
thereunder, and the Company's entire indebtedness in respect
thereof will be deemed to have been satisfied and discharged, if
there has been irrevocably deposited with the Trustee or any
Paying Agent (other than the Company), in trust, money in an
amount which will be sufficient, and/or Government Obligations,
the principal of and interest on which when due, without regard
to any reinvestment thereof, will provide moneys which, together
with moneys so deposited, will be sufficient, to pay when due the
principal of and interest on this bond when due.
No recourse shall be had for the payment of the principal of
or interest on this bond, or for any claim based hereon or
otherwise in respect hereof or of the Indenture, against any
incorporator, shareholder, director or officer, as such, past,
present or future, of the Company or of any predecessor or
successor corporation, either directly or through the Company or
any predecessor or successor corporation, whether by virtue of
any constitution, statute or rule of law, or by the enforcement
of any assessment or penalty or by any legal or equitable
proceeding or otherwise howsoever (including, without limiting
the generality of the foregoing, any proceeding to enforce any
claimed liability of shareholders of the Company, based upon any
theory of disregarding the corporate entity of the Company or
upon any theory that the Company was acting as the agent or
instrumentality of the shareholders); all such liability being,
by the acceptance hereof and as a part of the consideration for
the issuance hereof, expressly waived and released by every
holder hereof, and being likewise waived and released by the
terms of the Indenture under which this bond is issued, as more
fully provided in said Indenture.
This bond shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have
been signed by Bank of Montreal Trust Company, or its successor,
as Trustee under the Indenture.
IN WITNESS WHEREOF, the Company has caused this bond to be
signed in its name by the manual or facsimile signature of its
President or one of its Vice Presidents, and its corporate seal,
or a facsimile thereof, to be impressed or imprinted hereon and
attested by the manual by the manual or facsimile signature of
its Secretary or one of its Assistant Secretaries.
Dated
TUCSON ELECTRIC POWER COMPANY
By:
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Attest:
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the bonds, of the series designated therein,
described in the within-mentioned Indenture.
BANK OF MONTREAL TRUST COMPANY,
as Trustee
By:
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Authorized Signature