Exhibit B-4(b)
RIVER FUEL COMPANY #2, INC.
NOTE AGREEMENT
Dated as of January 15, 1999
$35,000,000
INTERMEDIATE TERM SECURED NOTES,
6.16% Series B, Due January 15, 2002
RIVER FUEL COMPANY #2, INC.
c/o United States Trust Company of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
As of January 15, 1999
TO Metropolitan Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: Intermediate Term Secured Notes,
6.16% Series B, due January 15, 2002
Dear Sirs:
River Fuel Company #2, Inc., a Delaware corporation (the
"Company"), hereby agrees with you as
follows:
1. DEFINITIONS
Certain terms are used in this Agreement as specifically
defined herein. Those definitions are
contained or referred to in Section 11.1
hereof.
2. PURCHASE AND SALE OF THE NOTES
2.1. The Notes. The Company has authorized the issuance of IT
Notes and the Company proposes to issue and sell at the Closing
the Company's Intermediate Term Secured Notes, 6.16% Series B,
due January 15, 2002, in the original aggregate principal amount
of $35,000,000 pursuant to the provisions of this Agreement. The
term "Notes" shall mean said $35,000,000 of Intermediate Term
Secured Notes, 6.16% Series B, due January 15, 2002, and shall
include any of the notes delivered in exchange therefor or upon
the transfer or replacement thereof as provided herein; and the
term "Note" shall mean any one of the Notes. Each Note shall be
issued substantially in the form set forth in Exhibit B hereto in
a minimum denomination of $100,000 or any larger amount that is
an integral multiple of $1,000, shall be dated the date of its
issuance, and shall bear interest on the unpaid principal amount
thereof at the rate of 6.16% per annum (computed on the basis of
a 360-day year and a 30-day month). Interest shall be payable
semiannually in arrears on the 15th day of January and July in
each year, commencing July 15, 1999. If any payment of principal
of or Yield-Maintenance Premium, if any, or interest on any Note
is required to be made on a date that is not a Business Day, such
payment shall be made on the next preceding Business Day. The
Notes shall mature on January 15, 2002 and shall be executed in
the name and on behalf of the Company by the Company's President
or one of its Vice Presidents thereunto duly authorized.
2.2. The Closing. The Company agrees to issue and sell to you,
in reliance upon your representations and warranties in Section
2.4 hereof, and subject to the terms and conditions and in
reliance upon the representations and warranties of the Company
set forth in this Agreement and of the Lessee set forth in the
certificate referred to in Section 4.2(b)(ii) hereof, you agree
to purchase from the Company at the Closing $35,000,000 aggregate
principal amount of Notes, at a price equal to 100% of such
principal amount. The Closing shall be held on January 22, 1999
(or such later date, not in any case later than February 12,
1999, as you and the Company may agree upon). The Closing shall
take place at 10:00 a.m., New York time, at the offices of Ropes
& ▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇. Unless otherwise
requested by you, the Notes to be delivered to you at the Closing
shall consist of a single Note payable to you or your nominee or
registered assigns in the principal amount set opposite your name
and specified in Exhibit A for purchase by you. You will pay for
the Note or Notes delivered to you as aforesaid by causing
payment, in immediately available funds, to be wire transferred
to Account No. 9102746717 (entitled the "River Fuel Company #2,
Inc. Collateral Account") at The Chase Manhattan Bank, ABA No.
▇▇▇▇▇▇▇▇▇. If at the Closing the Company shall fail to tender
the Notes to you as provided herein or if any of the conditions
set forth in Section 4.2 hereof shall not have been fulfilled to
your satisfaction, you shall, at your election, be relieved of
all obligations under this Agreement, without thereby waiving any
other rights you may have by reason of such failure or such non-
satisfaction.
2.3. Use of Proceeds. The Company will apply the proceeds of the
sale of the Notes solely in accordance with the terms and
limitations of the Basic Agreements. The proceeds of the sale of
the Notes sold at the Closing shall be paid into the Collateral
Account and shall be used by the Company to pay all amounts
outstanding under the Intermediate Term Notes of the Company,
Series A, and to purchase Nuclear Fuel. The Company will not,
directly or indirectly, use any of the proceeds of the sale of
the Notes for the purpose of purchasing or carrying any "margin
security" within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System or otherwise take or
permit any action which would cause the making of this Agreement
or the sale of the Notes to violate such Regulation T, Regulation
U, Regulation X or any other regulation of the Board of Governors
of the Federal Reserve System (12 C.F.R. Part II, as from time to
time in effect) applicable to the Company.
2.4. Purchase for Investment. You represent and warrant to the
Company as follows: You will acquire the Notes to be purchased
by you for your own account (or for a separate account under your
sole control and discretion), for investment and not with a view
to the distribution or any disposition thereof or any beneficial
interest therein, and you have no present intention of making any
such distribution or disposition; provided, however, that the
disposition of your property shall at all times be and remain
within your control. You have received a copy of the Private
Placement Memorandum. Your acquisition of the Notes at the
Closing shall constitute your confirmation of the representations
and warranties contained in this Section 2.4.
3. REPRESENTATIONS AND WARRANTIES
The Company represents and warrants that:
3.1. Organization and Authorization of the Company. The Company
is a duly organized and validly existing corporation in good
standing under the laws of the State of Delaware and has all
requisite power and authority to own its assets, to carry on its
business as now conducted and now proposed to be conducted, to
enter into this Agreement, to issue and sell the Notes and to
carry out the terms of this Agreement and the Notes and of the
Credit Agreement, the Depositary Agreement and each of the Basic
Agreements. The Company has all necessary corporate power and
has taken all action required to make all of the provisions of
this Agreement, the Notes, the Credit Agreement, the Depositary
Agreement, each of the Basic Agreements and any other agreements
and instruments executed in connection herewith and therewith by
which the Company is bound, the valid and binding obligations of
the Company that they purport to be. The Company has no
subsidiaries.
The Company is duly domesticated, licensed or qualified and
in good standing and authorized to do business in all
jurisdictions wherein the character of the property owned, or the
nature of the activities conducted by it, makes such
domestication, licensing or qualification necessary and where the
failure to be so qualified, either individually or in the
aggregate with all other such failures, would have a material
adverse effect on the business, assets or condition, financial or
other, of the Company.
All of the Company's outstanding capital stock has been duly
authorized and issued, is fully paid and nonassessable and is
owned, beneficially and of record, by the Trust free and clear of
any Lien or restriction on transfer, except for restrictions on
transfer imposed by (i) federal, state and foreign securities
laws and (ii) this Agreement.
3.2. Due Execution and Delivery. This Agreement, the Notes, the
Credit Agreement, the Depositary Agreement and each of the Basic
Agreements to which the Company is a party and the other
certificates and documents signed or to be signed on behalf of
the Company have been or will be duly executed and delivered by
an officer of the Company who is, or at the time of the execution
and delivery thereof on behalf of the Company was, or will be,
duly authorized to effect such execution and delivery, and all
such agreements, certificates and documents (collectively
"Documents"), if previously executed and delivered are, or, when
executed and delivered will be, legal, valid and binding
obligations of the Company, enforceable in accordance with their
terms, except that enforcement of the rights and remedies created
by the Documents is subject to (i) applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and (ii) general equitable
principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
3.3. Financial Statements; Business. The Company has furnished
you with a copy of its statement of receipts and disbursements
for the nine months ended September 30, 1998 and, by the Closing,
the Company shall provide you with a pro forma balance sheet as
of the date of the Closing, taking into account the sale of Notes
hereunder and the other transactions contemplated hereby and by
the Basic Agreements. The Company is not a party to any
instrument providing for the incurrence by the Company of
indebtedness for borrowed money other than the Credit Agreement,
the Series A Note Agreements, the Basic Agreements and the
Depositary Agreement. The Company has transacted no business
prior to the date hereof except for (i) the negotiation,
execution and delivery of this Agreement, and (ii) the carrying
out of the transactions contemplated by the Credit Agreement, the
Basic Agreements and the agreements referred to therein to be
carried out prior to the date hereof. The chief place of
business of the Company and the place where it keeps its records
concerning its accounts, contract rights, chattel paper and
general intangibles is in New York County in the State of New
York.
3.4. Title to Properties. The Company will have title to all of
the Company's assets owned or purported to be owned by the
Company as of the date of the Closing as shown on the pro forma
balance sheet to be delivered pursuant to Section 3.3 hereof,
including without limitation the Nuclear Fuel referred to in Fuel
Schedules Nos. 30 through 47, inclusive, to the Lease Agreement
and all such assets are free of any Liens, except those which are
of a character permitted by Section 8.12 hereof; provided,
however, that, with respect to any title to assets acquired from
the Lessee or any other vendor as provided in the Lease
Agreement, the Company (except with respect to its own actions)
is making this representation and warranty only to the extent of
and entirely in reliance on representations and warranties made
by the Lessee or such other vendor in the agreement of sale or in
the vendors' bills of sale delivered from time to time pursuant
to the Lease Agreement or in other instruments and has made no
independent investigation with respect thereto.
3.5. Litigation. Except as set forth in the Private Placement
Memorandum and the other Disclosure Documents, there is no
litigation at law or in equity, nor any proceeding or
investigation before any court, board or other governmental or
administrative agency or arbitrator, pending or to the knowledge
of the Company threatened, which may be expected to result in any
material judgment or liability against the Company not fully
covered by insurance or which may otherwise result in any
material adverse change in the business, assets or condition,
financial or other, of the Company, or which questions the
validity or enforceability of this Agreement, the Notes, the
Credit Agreement, the Depositary Agreement or any of the Basic
Agreements or of any action taken or to be taken by the Company
pursuant to or in connection with this Agreement, the Credit
Agreement, the Depositary Agreement or the Basic Agreements; and
no judgment, decree or order has been issued against the Company
which has, or may be expected to have, any material adverse
effect on the business, assets or condition, financial or other,
of the Company.
3.6. Conformity with Other Agreements. This Agreement does not
contain any provision, term or condition which is inconsistent
with, or contrary to, the Security Agreement, or which would
violate, or cause the Company to be in violation of, the Credit
Agreement, the Depositary Agreement or any Basic Agreement.
Neither the execution and delivery of this Agreement or the Notes
nor the consummation of any transaction contemplated hereby or
thereby has constituted or resulted in or will constitute or
result in a breach of the provisions of any other agreement or
instrument by which the Company is bound or result in the
creation under any agreement or instrument of any Lien upon any
of the assets of the Company, except as permitted by Section 8.12
hereof.
3.7. No Legal Obstacle to Agreement. The execution, delivery and
performance, or the acceptance, as the case may be, by the
Company of this Agreement, the Credit Agreement, the Basic
Agreements, the Nuclear Fuel Contracts and the Notes did not, do
not and will not violate any provision of any law or regulation
or of any writ or decree of any court or governmental
instrumentality applicable to the Company, and no consent,
license, approval, order or authorization of, or filing,
registration or declaration with, any governmental authority,
bureau or agency or any court or other Person is required in
connection with the execution, delivery, performance, acceptance,
validity or enforceability of any of the above mentioned
documents and instruments (provided that no representation is
given with respect to the Nuclear Fuel Contracts insofar as the
respective Manufacturers are concerned), except for (i) a general
license of the Company to own Nuclear Fuel from the Nuclear
Regulatory Commission (currently granted under C.F.R. Sections
40.21 and 70.20), (ii) a license to possess and use special
nuclear material granted by the Nuclear Regulatory Commission to
the Lessee, (iii) official action of approval or non-opposition
by the Louisiana Public Service Commission and (iv) the Orders
dated February 2, 1989, January 24, 1991 and January 24, 1996 of
the Securities and Exchange Commission authorizing the issuance
of $95 million in aggregate principal amount of IT Notes at any
one time outstanding, all of which licenses, orders, approvals
and filings have been duly obtained or made and are final and are
in full force and effect, and none of such licenses, orders,
approvals and filings is the subject of any pending or, to the
best of the Company's knowledge, threatened attack by direct
proceedings or otherwise; and except for a special license to
possess Nuclear Fuel from the Nuclear Regulatory Commission that
the Company or the Collateral Agent may require to take
possession of the Nuclear Fuel in the event of default, provided
that no representation is given with respect to Federal, New York
or Louisiana banking or trust laws or regulations or the
securities or blue sky laws or regulations of any State.
3.8. Investment Company Status. The Company is not an
"investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of
1940, as amended. The Company is not a "public utility company,"
or a "holding company," or an "affiliate" of a "holding company"
or a "subsidiary company" of a "holding company," within the
meaning of the Public Utility Holding Company Act of 1935, as
amended. The Security Agreement is not required to be qualified
under the Trust Indenture Act of 1939, as amended, and the
creation of the security interest in the Collateral in favor of
the Secured Parties under the Security Agreement does not require
an indenture to be qualified under said Act.
3.9. Absence of Foreign Status; etc.
(1) Absence of Foreign Status. The Company is not (i) a Person
included within the definition of "designated foreign country" or
"national" of a "designated foreign country" in Executive Order
No. 9193, as amended, or in the Foreign Assets Control
Regulations (31 C.F.R., Chapter V, Part 500, as amended), in the
Cuban Assets Control Regulations (31 C.F.R., Chapter V, Part 515,
as amended) or within the meaning of any of such orders or
regulations, or of any regulations, interpretations or rulings
issued thereunder, or in violation of such orders or regulations
or of any regulations, interpretations or rulings issued
thereunder or (ii) an entity listed in Section 550.304 of the
Libyan Sanctions Regulations (31 C.F.R., Chapter V, Part 550, as
amended).
(2) Pension Plan. The Company has no pension plans which are
subject to the provisions of Title IV of the Employee Retirement
Income Security Act of 1974, as amended, and the applicable rules
and regulations issued thereunder.
(3) Margin Stock. The Company does not presently own any shares
of "margin stock" within the meaning of Regulation U of the Board
of Governors of the Federal Reserve System or any regulations,
interpretations or rulings thereunder.
3.10. Private Offering. Neither the Company nor, to the
knowledge of the Company, the Lessee nor any Person authorized or
employed by any of them as agent, broker, dealer or otherwise
(the only such agent being ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.) in connection
with the offering or sale of the Notes has directly or indirectly
offered any of the Notes or any similar Security (other than
commercial paper) for sale to, or solicited offers to buy any
thereof from, or otherwise approached or negotiated with respect
thereto with, any prospective purchaser other than you and not
more than 125 other prospective purchasers. To the knowledge of
the Company, based on the representation of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
each offeree was an "accredited investor" as defined in Rule 501
under the Securities Act of 1933, as amended (the "1933 Act").
The Company agrees that it will not, either directly or
indirectly, offer the Notes or any part thereof or any similar
Security (other than commercial paper) for issue or sale to, or
solicit any offer to acquire any of the same from, anyone, or
take any other action which would subject the issuance and sale
of the Notes to the provisions of Section 5 of the ▇▇▇▇ ▇▇▇.
3.11. Disclosure. None of the representations in this
Agreement, the pro forma balance sheet referred to in Section 3.3
hereof, the Fuel Schedules referred to in Section 3.4 hereof, or
in any other document, certificate or statement furnished to you
by or on behalf of the Company in connection with the
transactions contemplated hereby contained as of its date any
untrue statement of a material fact or omitted to state a
material fact necessary in order to make the representations
contained herein or the statements contained therein not
misleading in light of the circumstances under which they were
made. There is no fact within the knowledge of the Company which
has not been disclosed herein or therein and which materially
adversely affects, or in the future, so far as the Company can
now foresee, may so affect, the business, assets or condition,
financial or otherwise, of the Company.
3.12. No Default. No default or event of default has
occurred under the Credit Agreement and, to the knowledge of the
Company, no default or event of default has occurred under any of
the Basic Agreements and no event of termination has occurred
under Section 20 of the Lease Agreement on the date hereof.
3.13. Security. The Security Agreement is effective to
create in favor of the Collateral Agent as agent for the Secured
Parties a legal, valid and enforceable first priority security
interest in all of the Collateral, and a legal, valid and
enforceable purchase money security interest in all of the
Company's right, title and interest in the Nuclear Fuel
Contracts, including, without limitation, any Nuclear Fuel being
acquired, stored, fabricated or processed with the funds being
made available to the Company pursuant to this Agreement on the
date of the Closing, and all filings, recordings and other
actions that are necessary in order to establish, preserve and
perfect the Collateral Agent's lien on and security interest in
the Collateral as a legal, valid and enforceable first lien and
security interest, or purchase money security interest, as the
case may be, have been duly effected, except that the foregoing
representations shall not be deemed to be violated as a result of
the existence or priority of any lien permitted by Section 15 of
the Lease Agreement.
3.14. Permitted Indebtedness. As of the date hereof and
after giving effect to the sale of the Notes pursuant to this
Agreement, the aggregate SLV of the Nuclear Fuel plus any accrued
Daily Lease Charges plus the cash and investments held in the
Collateral Account equals or exceeds, or will equal or exceed,
the sum of the Outstandings plus the aggregate outstanding
principal amount of all IT Notes.
4. CLOSING CONDITIONS.
4.1. Condition Precedent to Company's Obligations. The Company's
obligation to issue and deliver the Notes to be delivered to you
at the Closing shall be subject to the receipt by the Company at
or prior to the time of the Closing of (1) a written consent of
the Lessee authorizing the Company to execute and deliver this
Agreement and to issue and sell the Notes; and (2) copies of the
opinions of ▇▇▇ ▇. ▇▇▇, Esq. and ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP,
referred to in Section 4.2(a).
4.2. Conditions Precedent to Your Obligations. Your obligation
to purchase and pay for the Notes to be delivered to you at the
Closing shall be subject to the satisfaction of the following
conditions precedent prior to or contemporaneously with the
delivery of the Notes to you at the Closing:
(1) Opinions of Counsel. You shall have received at the Closing
from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel for the Company, ▇▇▇ ▇.
▇▇▇, Esq., counsel to the Lessee and special Louisiana counsel
for the Company, ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, New York counsel for
the Lessee, and Ropes & ▇▇▇▇, your special counsel, their
favorable opinions, dated the date of the Closing, each in form
and substance satisfactory to you.
(2) Representations True.
(1) The representations and warranties contained in Section 3
hereof and otherwise made by or on behalf of the Company in
writing in connection with the transactions contemplated hereby
(which shall not be deemed to include any of the documents
specifically referred to in Section 4.2(b)(ii) hereof) shall be
true and correct in all material respects at and as of the time
of the Closing with the same effect as though made at and as of
the time of the Closing; and no condition or event which, if the
Notes had been outstanding from the date hereof, would constitute
a Default or Event of Default shall have occurred and be
continuing at the time of Closing.
(2) The representations and warranties of the Lessee contained
in Section 2 of the Lease Agreement shall be true, correct and
complete in all material respects at and as of the time of the
Closing with the same force and effect as though made at and as
of the time of the Closing. On the date hereof the Private
Placement Memorandum, when read together with the other
Disclosure Documents, does not include any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances
under which they were made, not misleading. You shall have
received at the Closing a certificate dated the date thereof and
signed by the Treasurer or an Assistant Treasurer of the Lessee
substantially in the form of Exhibit C to this Agreement.
(3) Compliance with this Agreement. The Company shall have
performed and complied with all agreements and conditions
contained herein which are required to be performed or complied
with by the Company before or at the Closing.
(4) Company's Certificate. You shall have received at the
Closing (1) a certificate of the Secretary of the Company dated
the date of the Closing certifying: (i) that the charter
documents and by-laws of the Company attached thereto are true
and complete and in full force and effect, (ii) that the
resolutions attached thereto have been duly adopted by the Board
of Directors of the Company, (iii) that there is no action
pending to amend the Company's charter, and (iv) the incumbency
and specimen signatures of each officer of the Company executing
this Agreement and the Notes, and (2) a certificate dated the
date of the Closing and signed by an officer of the Company,
certifying that the conditions specified in Sections 4.2(b)(i)
and 4.2(c) have been fulfilled.
(5) Lessee's Consent and Letter Agreement. You shall have
received at the Closing a copy of (i) the Lessee's Consent
pursuant to Section 33(b) of the Lease Agreement and (ii) a
letter agreement substantially in the form of Exhibit D to this
Agreement (the "Lessee's Letter Agreement"), both signed by the
Lessee.
(6) Legality. The purchase of and payment for the Notes shall
not be prohibited by any applicable law or governmental
regulations and shall not subject you to any penalty or other
onerous condition under or pursuant to any applicable law or
governmental regulation. The Notes shall at the time of the
Closing qualify as a legal investment for mutual life insurance
companies under the New York Insurance Law (without resort to any
"basket" provision thereof) and you shall have received such
evidence as you may reasonably request to establish compliance
with this condition.
(7) Proceedings Satisfactory; Basic Agreements. All proceedings
taken in connection with the sale of the Notes and all documents
and papers relating thereto shall be satisfactory to you. You
and your special counsel shall have received copies of such
documents and papers as you or they may reasonably request in
connection therewith or as a basis for your special counsel's
closing opinion, all in form and substance satisfactory to you.
(8) Information. The Company shall have delivered to you such
information as you shall have reasonably requested for use as a
basis for any filings which you may be required to make with
certain regulatory bodies and with the National Association of
Insurance Commissioners.
(9) Private Placement Number. A Private Placement Number issued
by Standard & Poor's CUSIP Service Bureau (in cooperation with
the Securities Valuation Office of the National Association of
Insurance Commissioners) shall have been obtained for the Notes.
(10) Payment of Fees. The Company shall have made satisfactory
arrangements for the payment of the legal fees and expenses of
your special counsel, Ropes & ▇▇▇▇.
5. PAYMENT, REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT OF
THE NOTES.
5.1. Payment Address. The Company shall make or shall cause the
Registrar to make all payments on account of interest, principal
and Yield-Maintenance Premium, if any, to be paid in respect of
the Notes held by you by wire transfer in immediately available
funds on the scheduled payment date at your payment address
specified in Exhibit A hereto, or in such other manner and at
such other address as shall be designated by notice to the
Company and the Registrar in respect of Notes held by you or by
any successor Noteholder. Payments on account of each Note shall
be made without the necessity of any presentment or notation of
payment, and the amount of principal so paid on any Note shall be
regarded as having been retired and canceled at the time of
payment. Any Note with respect to which interest, principal and
Yield-Maintenance Premium, if any, shall have been fully paid
shall be surrendered to the Company (or, at the Company's
direction, to the Registrar) and shall be retired and canceled.
The holder of any Note, before any transfer thereof, shall make a
notation thereon of the date to which interest has been paid and
of all principal payments theretofore made thereon and shall in
writing notify the Company of the name and address of the
transferee.
5.2. Registration, Transfer or Exchange. So long as any of the
Notes remain unpaid, the Company shall cause the Registrar to
keep at its office referred to in Section 12.1 hereof (or at such
other office of the Registrar within the State of New York as the
Company or the Registrar shall have identified by written notice
to each of the Noteholders) a register in which shall be entered
the names and addresses of all Noteholders and the particulars of
those Notes held by them and of all transfers of such Notes. The
holder in whose name any Note shall be so registered shall be
deemed and treated as the owner thereof for all purposes of this
Agreement and neither the Company nor the Registrar shall be
affected by any notice to the contrary. For the purpose of any
request, direction or consent hereunder, the Company and the
Registrar may deem and treat the registered holder of any Note as
the owner thereof without production of such Note. Any
Noteholder may at any time and from time to time prior to
maturity or redemption thereof surrender any Note held by it for
transfer or exchange at said office of the Registrar; provided,
however, that the proposed transfer or exchange does not violate
the 1933 Act or any other applicable law relating to the sale of
securities and the Company may require, as a condition to the
registration of any transfer, an opinion of counsel for the
transferring Noteholder (which may be in-house counsel) to the
effect that such transfer is exempt from the registration
requirements of the 1933 Act and, if applicable, any state
securities law. If such opinion is not provided by in-house
counsel and if the transfer shall be to an "accredited investor"
as defined in Rule 501(a) under the 1933 Act, the reasonable cost
of such opinion shall be borne by the Company. Within a
reasonable time thereafter and without expense (other than
transfer taxes, if any) to such holder, the Company shall cause
the Registrar to issue in exchange therefor another Note or
Notes, dated the date to which interest has been paid on each
Note surrendered or dated the date of such surrendered Note if no
interest has theretofore been paid thereon, for the same
aggregate principal amount as the unpaid principal amount of the
Note or Notes so surrendered, having the same stated maturity
date and rate of interest, containing the same provisions and
subject to the same terms and conditions as the Note or Notes so
surrendered. Each such new Note shall be registered in the name
of such Person or Persons as the holder of such surrendered Note
or Notes may designate in writing, and such exchange shall be
made in a manner such that no additional or lesser amount of
principal or interest shall result. The Company will pay or will
cause the Registrar to pay shipping and insurance charges, from
and to each Noteholder's main office, involved in the exchange or
transfer of any Note.
5.3. Replacement. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or
mutilation of any Note and, if requested in the case of any such
loss, theft or destruction, upon delivery of an indemnity
agreement or security reasonably satisfactory to the Company, or,
in the case of any such mutilation, upon surrender and
cancellation of such Note, the Company will cause the Registrar
to issue a new Note, of like tenor and amount and dated the date
to which interest has been paid, or dated the date of such lost,
stolen, destroyed or mutilated Note if no interest has
theretofore been paid thereon, in lieu of such lost, stolen,
destroyed or mutilated Note.
Notwithstanding the foregoing provisions of this Section
5.3, if any Note of which you or your nominee is the holder is
lost, stolen or destroyed, the affidavit of your Treasurer or any
officer setting forth the circumstances with respect to such
loss, theft or destruction shall be accepted as satisfactory
evidence thereof, and no indemnity or security shall be required
as a condition to the execution and delivery by the Company and
the Registrar of a new Note in replacement of such lost, stolen
or destroyed Note other than your written agreement to indemnify
the Company and the Registrar.
6. REDEMPTION PROVISIONS.
The Company covenants and agrees that so long as any of the
Notes are outstanding it will redeem the Notes as follows:
6.1. Mandatory Redemption upon Termination of Lease Agreement.
The Company shall, upon the occurrence of any event of
termination described in Section 20(a)(ii) through 20(a)(x) of
the Lease Agreement, redeem or shall cause the Registrar to
redeem the entire outstanding principal amount of the Notes
without premium on the Termination Settlement Date. Except as
provided in this Section 6.1 or in Section 6.2 hereof, neither
the Company nor the Registrar may redeem the Notes, in whole or
in part, prior to the stated maturity thereof.
6.2. Optional Redemption of Notes. Subject to Section 6.7
hereof, the Company shall, (a) at the request of the Lessee or
(b) upon the occurrence of an event of termination as described
in Section 20(a)(i) of the Lease Agreement, redeem or shall cause
the Registrar to redeem the entire principal amount of the Notes
outstanding, or, with respect to a redemption pursuant to the
foregoing clause (a) only, any portion thereof equal to or
greater than the greater of $1,000,000 or 5% of the aggregate
principal amount of the Notes then outstanding (the "Called
Principal") at a price equal to the sum of (i) the Called
Principal, (ii) interest accrued on the Called Principal through
the Redemption Date (as defined below) and (iii) the Yield-
Maintenance Premium, if any. Upon any partial redemption of the
Notes, each Noteholder shall, if so requested by the Company or
the Registrar, surrender to the Registrar all Notes held by such
Noteholder in exchange for a new Note or Notes in an aggregate
principal amount equal to the outstanding principal amount of the
surrendered Note or Notes, less the amount of such partial
redemption.
6.3. Notice of Redemption. Notice of each redemption of Notes
pursuant to Section 6.1 or 6.2 hereof shall be given by the
Company not less than 30 nor more than 60 days before the
redemption date (the "Redemption Date") by mailing to each
Noteholder an irrevocable notice of intention to redeem
specifying the date of redemption, identifying the event of
termination under the Lease Agreement giving rise to such
redemption (in the case of redemption pursuant to Section 6.1),
stating the aggregate principal amount of Notes to be redeemed on
such date and the principal amount of Notes to be redeemed on
such date held by the Noteholder to whom such notice is sent and
accrued interest applicable to such redemption. In the case of a
redemption pursuant to Section 6.2 hereof, a written calculation
of the redemption price shall be sent to each holder of Notes to
be redeemed not later than 12:00 noon on the Business Day prior
to the Redemption Date.
6.4. Payment and Interest Cut-Off. Upon each redemption of
Notes, in whole or in part, the Company shall pay or shall cause
the Registrar to pay to each holder thereof the amount of its
Notes to be redeemed together with the unpaid interest in respect
thereof accrued to the Redemption Date and Yield-Maintenance
Premium, if any. Notice of redemption having been given in
compliance with Section 6.3 hereof, the aggregate principal
amount of the Notes to be redeemed shall become due and payable
on the Redemption Date, and from and after said date (unless the
Company or the Registrar shall default in paying the amounts then
due) interest on such principal amount of the Notes shall cease
to accrue.
6.5. Permanent Retirement of Notes. Notes redeemed in full or
otherwise acquired by the Company or the Registrar shall be
permanently retired and cancelled and shall not under any
circumstances be reissued or resold.
6.6. Selection of Notes for Redemption. Each redemption required
by this Agreement shall be made so that the Notes then held by
each Noteholder shall be redeemed in a principal amount in
integral multiples of $1,000 which shall bear the same ratio, as
nearly as possible, to the total principal amount being redeemed
as the principal amount of the Notes then held by each Noteholder
shall bear to the aggregate principal amount of the Notes then
outstanding.
6.7. Repurchase of Notes. Neither the Company nor the Registrar
will repurchase or make any offer to repurchase IT Notes unless
(i) such IT Notes are repurchased in order of maturity and (ii)
if the Company or the Registrar has offered to purchase less than
all IT Notes with a given maturity date, then such IT Notes will
be repurchased pro rata from all holders of such IT Notes at the
time outstanding and upon the same terms.
7. TERMINATION OF LEASE AGREEMENT; AMENDMENT OF BASIC
AGREEMENTS AND NUCLEAR FUEL CONTRACTS; ADDITIONAL COVENANTS.
So long as any IT Notes are outstanding:
7.1. Termination of Lease Agreement. The Company shall not
terminate the Lease Agreement pursuant to Section 3(b) of the
Lease Agreement without receiving the prior written consent of
the holders of at least 66K% in aggregate principal amount of all
IT Notes at the time outstanding.
7.2. Basic Agreements and Nuclear Fuel Contracts. The Company
shall not enter into any amendment to or supplement of any Basic
Agreement or any written waiver or modification of the terms of
any Basic Agreement or enter into any amendment to or supplement
of any Nuclear Fuel Contract or any written waiver or
modification of the terms of any Nuclear Fuel Contract (unless,
in the case of Nuclear Fuel Contracts, such actions shall be
permitted under the Lease Agreement) without in each case
receiving the prior written consent of the holders of at least
66K% in aggregate principal amount of all IT Notes at the time
outstanding.
7.3. Additional Covenants. The Company shall not agree to any
affirmative or negative covenant with respect to the business,
operations, properties or condition, financial or otherwise, of
the Company with any Person who shall extend or propose to extend
credit to the Company unless either (x) such covenant is in
existence on the date hereof and a copy of the document
containing such covenant has been provided to you or (y) subject
to Section 12.5(a), such covenant is contained in an amendment of
or supplement to this Agreement, in an agreement with respect to
the purchase of other IT Notes or in one of the Basic Agreements.
8. COVENANTS.
Without limiting any other covenants and provisions hereof,
the Company covenants and agrees that, so long as any of the
Notes are outstanding, it will perform and observe the following
covenants and provisions:
8.1. General Obligations. The Company will (i) duly observe and
conform to all valid requirements of any governmental authorities
relative to the conduct of its business or to the ownership of
its assets, (ii) preserve and keep in full force and effect the
existence of the Company and the rights, privileges and
franchises of the Company and (iii) obtain, maintain and keep in
full force and effect all consents, permits, licenses, approvals,
orders and authorizations which are necessary to properly carry
out the transactions contemplated to be performed by it by this
Agreement, the Notes and the Basic Agreements to which it is a
party.
8.2. Books of the Company. The Company will keep books of record
and account acceptable to the Noteholders in relation to its
business and activities.
8.3. Notices. Upon obtaining knowledge thereof, the Company will
promptly give written notice to the Noteholders of (i) the
occurrence of any Default or Event of Default hereunder or any of
the events set forth in Sections 18, 19 or 20(a) of the Lease
Agreement or any "Default" or "Event of Default" under the Credit
Agreement; (ii) any litigation or proceedings with respect to the
Company, or affecting the Company or any of its assets; and (iii)
such other information concerning the business, assets, or
condition, financial or otherwise, of the Company as any
Noteholder may from time to time reasonably request.
8.4. Payment of Taxes. The Company will cause to be computed,
paid and discharged (subject to the provisions of Section 10
hereof) when due all taxes, assessments and other governmental
charges or levies imposed upon the Company, or upon any income or
assets of the Company, prior to the day on which penalties are
attached thereto, unless and except to the extent that the same
shall be contested in good faith by appropriate proceedings
diligently prosecuted and no foreclosure, distraint, sale or
other similar proceedings shall have commenced or been
threatened.
8.5. Governmental Permits. The Company will, to the extent
obtained or received by it, furnish or cause to be furnished to
the Noteholders a copy of any authorization, license, permit,
consent, order or approval of any governmental authority obtained
or required to be obtained in connection with the transactions
contemplated by this Agreement, the Notes or any of the Basic
Agreements.
8.6. Inspection. The Company will permit any Person designated
by any Noteholder to inspect any of the Company's Property
(subject to the provisions of Section 12 of the Lease Agreement)
or any of the books or financial records of the Company and to
discuss the affairs, finances and accounts of the Company with
the officers of the Company or the Company's independent
certified public accountants, all at such reasonable times and as
often as any Noteholder may reasonably request.
8.7. Financial Statements. The Company will furnish to each
Noteholder, within 30 days after the close of each Calendar
Quarter, a statement of receipts and disbursements relating to
the Company for such Calendar Quarter and for the portion of the
year then ended.
8.8. Copies of Documents. The Company will promptly deliver to
each Noteholder copies of (i) all amendments, modifications and
waivers, (ii) all requests for any such amendment, modification
or waiver, and (iii) any notice of an "Event of Default" received
or delivered by the Company under or with respect to the Credit
Agreement, the Lease Agreement, any of the other Basic Agreements
or any of the IT Note Agreements (or, to the extent requested by
any Noteholder, the Depositary Agreement or the Dealer
Agreement), to the extent that the same shall not have been
delivered to such Noteholder pursuant thereto.
8.9. Activities of Company. The Company will not engage in any
business or activity of any kind or enter into any transaction
which is not directly related to the purchase, sale and leasing
of Nuclear Fuel pursuant to the Lease Agreement and the financing
thereof in the manner contemplated by the Credit Agreement, this
Agreement, the Depositary Agreement, the Basic Agreements and the
IT Note Agreements.
8.10. Indebtedness. The Company will not, directly or
indirectly, create, incur, assume or suffer to exist any
indebtedness of any kind for borrowed money, extensions of credit
or the deferred purchase price of property, except
(1) the indebtedness evidenced by the IT Notes, each of which
complies with all of the following requirements: (i) such IT
Note shall not be secured by any collateral other than the
Collateral described in the Security Agreement in accordance with
the terms thereof, unless the Notes, the CP Notes and the Loan
Notes and any other indebtedness incurred in connection with bank
credit facilities permitted under Section 8.10(b) hereof are
secured equally and ratably by such additional collateral, (ii)
such IT Note shall not be guaranteed directly or indirectly by
any Person nor shall the holder thereof be assured against loss
or nonpayment unless the Notes, the CP Notes and the Loan Notes
and any other indebtedness incurred in connection with bank
credit facilities permitted under Section 8.10(b) hereof shall
have the benefit of such guaranty or assurance on a pro rata
basis with such IT Note, (iii) there shall not exist a Default or
an Event of Default hereunder or a "Default" or "Event of
Default" under the Credit Agreement on the date of issuance of
such IT Note, and (iv) immediately following the issuance of such
IT Note, the aggregate SLV of the Nuclear Fuel plus any accrued
Daily Lease Charges plus cash and investments held in the
Collateral Account shall equal or exceed the sum of the
Outstandings under the Credit Agreement and any other
indebtedness incurred in connection with bank credit facilities
permitted under Section 8.10(b) hereof plus the aggregate
outstanding principal amount of all IT Notes (including the
Notes); and
(2) indebtedness evidenced by the Credit Agreement, the CP Notes
and the Loan Notes or any of their successors. No such bank
indebtedness shall constitute permitted indebtedness of the
Company unless (i) the banks providing such credit facilities,
other than the Credit Agreement, shall have acknowledged and
agreed to the terms of the Basic Agreements, (ii) the banks
providing such credit facilities, including the banks
participating in the Credit Agreement, shall not be secured by
any collateral other than the Collateral described in the
Security Agreement in accordance with the terms thereof unless
all IT Notes at the time outstanding are secured equally and
ratably by such additional collateral, (iii) indebtedness
incurred in connection with such bank credit facilities shall not
be guaranteed directly or indirectly by any Person nor shall any
bank providing such credit facilities be assured against loss or
nonpayment unless all IT Notes shall have the benefit of such
guaranty or assurance on a pro rata basis with the banks
providing such credit facilities, (iv) there shall not exist a
Default or an Event of Default hereunder at the time of execution
of any credit agreement with a bank other than the Credit
Agreement, and (v) immediately following the incurrence of any
indebtedness with respect to such bank credit facilities, the
aggregate SLV of the Nuclear Fuel plus any accrued Daily Lease
Charges plus cash and investments held in the Collateral Account
shall equal or exceed the sum of Outstandings under the Credit
Agreement and all other outstanding bank indebtedness plus the
aggregate outstanding principal amount of all IT Notes (including
the Notes); and
(3) overnight borrowings from the Lessee, on an unsecured and
interest free basis, for the purpose of depositary funds in the
Commercial Paper Account, which shall be used solely to pay
matured or concurrently maturing CP Notes;
provided, however, that all indebtedness for borrowed money
(other than indebtedness evidenced by the IT Notes), in aggregate
principal amount (before discount) at any one time outstanding,
shall not exceed $160,000,000 less the aggregate principal amount
of the IT Notes outstanding at such time.
8.11. Guarantees. The Company will not become or remain
liable, directly or contingently, in connection with any
obligation of any Person, whether by guaranty, endorsement (other
than endorsements of negotiable instruments for deposit or
collection in the ordinary course of business), agreement to
purchase or repurchase, agreement to supply or advance funds or
otherwise.
8.12. Liens. The Company will not create, incur, assume or
suffer to exist any Lien upon or with respect to any of the
Company's Property, whether now owned or hereafter acquired, or
assign or otherwise convey any right to receive income except (i)
Liens created in favor of the Collateral Agent, for the ratable
benefit of the Secured Parties, under the Security Agreement and
(ii) Liens which Section 15 of the Lease Agreement allows the
Lessee to permit on the Property of the Company.
8.13. Distributions. The Company will not declare or pay any
distribution or dividend (whether in cash or in Property) with
respect to the profits, assets or capital of the Company.
8.14. Investments; Loans. The Company will not make or
suffer to exist any loans or advances to, or make any investments
(by way of transfer of Property, contributions to capital,
purchase of stock or securities or evidences of indebtedness,
acquisition of the business or assets, or otherwise) in, any
Person except for the purchase of Nuclear Fuel as contemplated by
the Lease Agreement and the investments permitted by Section 3.4
of the Security Agreement.
8.15. Salaries. The Company will not pay any salaries or
wages.
8.16. Merger; Sales. The Company will not enter into any
transaction of merger or consolidation, or terminate, liquidate
or dissolve itself (or suffer any termination, liquidation or
dissolution), or acquire or be acquired by any Person, or
otherwise change the form or organization of its business, or
convey, sell, lease or otherwise dispose of any of its Property
or business, except for (i) transactions contemplated by the
Lease Agreement, or (ii) Liens permitted by Section 8.12 hereof.
8.17. Payments. The Company will not make any payment or
advance any amounts to any Person unless it shall be expressly
permitted to make such payment by this Agreement, the Credit
Agreement, other bank credit facilities permitted under Section
8.10(b) hereof, the Lease Agreement, the Dealer Agreement or an
IT Note Agreement.
8.18. Compliance with Agreements. The Company will not fail
to (i) duly perform all obligations to be performed by it under
each of the Basic Agreements and (ii) upon instructions from the
Collateral Agent on behalf of the Secured Parties pursuant to
Section 6.2 of the Security Agreement, promptly take any and all
actions as may be necessary to enforce its rights under the Lease
Agreement and to enforce or secure the performance by the Lessee
of its obligations thereunder. Without limiting the generality
of the foregoing, the Company shall, upon the written
instructions of the Lessee, file or cause to be filed all
continuation statements required under the Uniform Commercial
Code or other applicable law, as from time to time in effect in
each applicable jurisdiction, with respect to the Liens and
security interests granted under the Security Agreement in order
to maintain a prior perfected security interest in the
Collateral.
8.19. Acceptance of Additional Nuclear Fuel Contracts. The
Company shall not accept the assignment by the Lessee of all or
any part of the Lessee's rights in and to any additional Nuclear
Fuel Contracts except in accordance with the terms and provisions
of Section 4 of the Lease Agreement.
8.20. Investment Company. The Company will not be an
"investment company" or a company "controlled" by an investment
company within the meaning of the Investment Company Act of 1940,
as amended.
8.21. Public Utility Holding Company. The Company will not
be a "public utility company," or a "holding company," or an
"affiliate" of a "holding company" or a "subsidiary" of a
"holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
8.22. Accounts and Deposits. The Company will not open,
create or maintain any bank account, or make any deposit with or
in any financial institution, except for the Commercial Paper
Account and the Collateral Account.
8.23. Expenses and Indemnity. Whether or not the
transactions contemplated hereby shall be consummated, the
Company will pay all reasonable expenses (including the
reasonable fees and expenses of its counsel and your special
counsel) in connection with the preparation and reproduction of
this Agreement and the Notes, and also in connection with any
amendments of or waivers under this Agreement or the Notes, will
indemnify you and the other Noteholders and hold you and the
other Noteholders harmless against all broker's and finder's
fees, and will pay all your and such Noteholders' out-of-pocket
expenses reasonably incurred in connection with the matters
contemplated hereby and thereby, and, at your or such
Noteholders' election, will reimburse you or such Noteholders for
any such expenses paid by you or such Noteholders.
In the event that it subsequently is determined that any tax
is due on the issue of the Notes or on your acquisition thereof,
or on any modification of the Notes or of this Agreement, the
Company will pay or cause to be paid all such taxes and interest
and penalties, if any (excluding, however, any transfer taxes),
and will indemnify and save you and all holders of the Notes
harmless from any loss or damage of any kind whatsoever resulting
from or arising out of the nonpayment or delay in the payment of
such taxes. The obligations of the Company under this Section
8.23 shall survive the payment of the Notes. In no event shall
the Company be required to pay any taxes based upon your or any
other Noteholder's net income or profits or upon interest income
arising out of the Notes.
9. EVENTS OF DEFAULT; CONSEQUENCES.
9.1. Events of Default. The occurrence of one or more of the
following events shall constitute an "Event of Default" under
this Agreement:
(1) Principal Payments. The Company fails to make any payment
of any part of the principal of any of the Notes or any Yield-
Maintenance Premium when and as the same shall become due and
payable, whether at the stated maturity of the Notes or at a date
fixed for redemption or by acceleration or otherwise; or
(2) Interest Payments. The Company fails to make any payment of
interest on any of the Notes when and as the same shall become
due and payable and any such default shall continue for a period
of ten days; or
(3) Covenant Defaults. The Company (i) fails to perform or
observe any covenant contained in Section 7 or Sections 8.9,
8.10, 8.11, 8.12 (with respect to Liens created by it), 8.13
through 8.17, 8.18 (ii) (with respect to specific instructions
from the Collateral Agent), 8.19 and 8.22 of this Agreement, (ii)
fails to provide the notice required by Section 8.3(i) of this
Agreement and such failure shall continue for a period of fifteen
days from the date on which an officer of the Company first
acquired knowledge of the event requiring such notice or (iii)
fails to perform or observe any covenant, condition or agreement
pursuant to the terms of the Security Agreement and such failure
continues unremedied for 30 days after written notice thereof
from the Collateral Agent to the Company; or
(4) Other Duties. The Company fails to comply with any other
provision of the Notes or of this Agreement, and such failure
shall continue for more than thirty days after written notice
thereof shall have been given to the Company by any Noteholder;
or
(5) Representations or Warranties. Any representation or
warranty made by or on behalf of the Company or the Lessee
contained in this Agreement or in any instrument furnished in
compliance with or in reference to this Agreement, or in
connection with any amendment thereof, shall prove to have been
false or misleading in any material respect as of the date made;
or
(6) Default on Indebtedness. Any IT Note, or any other
indebtedness for borrowed money of the Company, is declared to
be, or otherwise becomes, due and payable (other than at the
option of the Company) prior to its stated maturity or regularly
scheduled dates of payment, or any scheduled dates of payment, or
any event shall occur or any condition shall exist in respect of
any such indebtedness or under any agreement securing or relating
to such indebtedness, the effect of which is to require (or
permit any holder of such indebtedness or a trustee to require)
such indebtedness, or any portion thereof, to be paid prior to
its stated maturity or prior to its regularly scheduled dates of
payment; or
(7) Event of Default under Lease Agreement or Credit Agreement.
Any "Event of Default" shall occur under the Lease Agreement or
any "Event of Default" shall occur under the Credit Agreement or
any event of default shall occur with respect to any other
indebtedness incurred in connection with bank credit facilities
permitted under Section 8.10(b) hereof; or
(8) Lessee's Letter Agreement. The Lessee fails to observe any
covenant contained in the Lessee's Letter Agreement; or
(9) Bankruptcy; Insolvency. The Company shall be involved in
financial difficulties as evidenced:
(1) by its commencement of a voluntary case under Title 11 of
the United States Code as from time to time in effect, or by its
authorizing the commencement of such a voluntary case;
(2) by its filing an answer or other pleading admitting or
failing to deny the material allegations of a petition filed
against it commencing an involuntary case under said Title 11, or
seeking, consenting to or acquiescing in the relief therein
provided, or by its failing to controvert timely the material
allegations of any such petition;
(3) by the entry of an order for relief in any involuntary case
commenced under said Title 11;
(4) by its seeking relief as a debtor under any applicable law,
other than said Title 11, of any jurisdiction relating to the
liquidation or reorganization of debtors or to the modification
or alteration of the rights of creditors, or by its consenting to
or acquiescing in such relief;
(5) by the entry of an order by a court of competent
jurisdiction (i) finding it to be bankrupt or insolvent, (ii)
ordering or approving its liquidation, reorganization or any
modification or alteration of the rights of its creditors, or
(iii) assuming custody of, or appointing a receiver or other
custodian for all or a substantial part of its property; or
(6) by its making an assignment for the benefit of, or entering
into a composition with, its creditors, or appointing or
consenting to the appointment of a receiver or other custodian
for all or a substantial part of its property.
9.2. Default Remedies.
(1) Acceleration. If an Event of Default described in clause
(a) or (b) of Section 9.1 hereof shall occur and be continuing
with respect to any Note, the holder of such Note may by notice
in writing to the Company declare the entire unpaid principal
balance of such Note and all interest and Yield-Maintenance
Premium, if any, accrued and unpaid thereon to be, and such
amount shall thereupon become, forthwith due and payable, without
any presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived, and, to the extent
permitted by law, such holder may proceed to institute suit for
the enforcement of the payment of principal and interest and
Yield-Maintenance Premium, if any, on such Note. If an Event of
Default, including without limitation, an Event of Default
described in clause (a) or (b) of Section 9.1 hereof, shall occur
and be continuing (unless there shall have occurred an Event of
Default under Section 9.1(i) hereof, in which case the unpaid
principal balance of all Notes and all interest and Yield-
Maintenance Premium, if any, accrued and unpaid thereon shall
automatically become due and payable), the holders of at least a
majority of the principal amount of the Notes at the time
outstanding may, by notice in writing to the Company, declare the
entire unpaid principal balance of the Notes and all interest and
Yield-Maintenance Premium, if any, accrued and unpaid thereon to
be, and such Notes shall thereupon become, forthwith due and
payable, without any presentment, demand, protest or other notice
of any kind, all of which are hereby expressly waived. The
Company will forthwith pay to the holder or holders of all the
Notes at the time outstanding the entire unpaid principal balance
of and interest and Yield-Maintenance Premium, if any, accrued on
the Notes. In addition, subject to the provisions of the
Security Agreement, following an Event of Default each Noteholder
may proceed to protect and enforce such holder's rights by suit
in equity, action at law and/or other appropriate proceeding for
specific performance of, or for an injunction against violation
of, any covenant or provision contained in the Notes or herein or
in aid of the exercise of any power granted in the Notes or
herein. Each of the Noteholders shall following an Event of
Default have all of the rights of a Secured Party; provided,
however, that no Noteholder shall have any right to enforce
directly any of the rights or the security interests granted by
the Security Agreement or to require the Collateral Agent to take
or refrain from taking any action under the Security Agreement.
(2) Nonwaiver and Expenses. No course of dealing between the
Company or the Lessee and any Noteholder nor any delay or failure
on the part of any Noteholder to exercise any right shall operate
as a waiver of such right. A waiver of the rights of any
Noteholder may be made only in accordance with Section 12.5
hereof. If the Company fails to pay when due the principal of or
interest and Yield-Maintenance Premium, if any, on any Note, or
fails to comply with any other provision of this Agreement, the
Company will pay to the holder thereof, to the extent permitted
by law, any applicable late charge, as provided in the Notes, and
such further amounts as shall be sufficient to cover the costs
and expenses, including but not limited to reasonable attorneys'
fees, incurred by such holder in collecting any sums due on the
Notes or in otherwise enforcing any of such holder's rights under
this Agreement.
9.3. Annulment of Acceleration. If a declaration is made
pursuant to Section 9.2(a) by any holder or holders of the Notes,
then and in every such case, the holders of more than 66-2/3% in
aggregate principal amount of the Notes then outstanding may, by
written instrument filed with the Company, rescind and annul such
declaration, and the consequences thereof, provided that at the
time such declaration is annulled and rescinded:
(1) no judgment or decree has been entered for the payment of
any monies due pursuant to the Notes or this Agreement;
(2) all arrears of interest upon all the Notes and all other
sums payable under the Notes and under this Agreement (except any
principal or interest on the Notes which has become due and
payable by reason of such declaration under Section 9.2(a)) shall
have been duly paid; and
(3) each and every other Default and Event of Default shall have
been waived pursuant to Section 12.5 hereof or otherwise made
good or cured;
and provided, further that no such rescission and annulment shall
extend to or affect any subsequent Default or Event of Default or
impair any right consequent thereon.
9.4. Notice of Default. If any Noteholder or Noteholders shall
demand payment because of, or take any other action of which the
Company shall have actual knowledge in respect of, an alleged
Default or Event of Default, or if the Company acquires knowledge
of any Default or Event of Default, the Company shall forthwith
give written notice, specifying the nature of such Default or
Event of Default and any such action, to each holder of the Notes
at the time outstanding, and the Company shall also give written
notice to each such holder if any written instrument of
rescission or annulment as aforesaid shall be filed with it under
the provisions of Section 9.3 hereof.
10. NO RECOURSE.
This Agreement, the Depositary Agreement, the Notes, the
Security Agreement, the Lease Agreement and any other document
executed and delivered by the Company in connection herewith or
therewith (the "Company Documents") is intended to be a corporate
obligation of the Company only, and all of the statements,
representations, covenants and agreements made by the Company
contained herein or therein are made and intended only for the
purpose of binding the Company and establishing the existence of
rights and remedies provided for herein or therein which can be
exercised and enforced against the Company. Therefore, anything
contained in this Agreement, the Depositary Agreement, the Notes,
the Security Agreement, the Lease Agreement and any other
document to the contrary notwithstanding, no recourse claim may
be made by any Noteholder against River Fuel Trust #2, United
States Trust Company of New York, as trustee or in its individual
capacity, or any incorporator, shareholder (direct or indirect),
affiliate, director, officer, employee or agent of the Company,
River Fuel Trust #2 or United States Trust Company of New York
with respect to claims against the Company arising under or
relating to this Agreement; provided, however, that nothing in
this Section 10 shall relieve the Company from its corporate
obligations under the Company Documents.
11. INTERPRETATION OF THIS AGREEMENT.
11.1. Terms Defined. Unless the context otherwise specifies
or requires, each term defined in this Section 11.1 shall, when
used in this Agreement, have the meaning indicated. To the
extent that certain of the terms defined in this Agreement are
defined by cross-reference to documents which may not be in full
force and effect during the entire term of this Agreement, and
subject to the provisions of Section 7.2 hereof, the definitions
contained in such documents shall be and remain effective for
purposes of implementing this Agreement during the term of this
Agreement.
Acceleration Date - the date on which any Note is declared
or otherwise becomes due and payable pursuant to Section 9.2
hereof.
Agreement - the term "Agreement" shall include, in addition
to this Agreement pursuant to which the Notes are originally
issued, every other instrument which the Company and the holders
of the Notes execute at any time which shall amend this
Agreement, and the words "hereof", "hereunder", "herein" and
other like expressions refer to this Agreement as so amended as a
whole and not to any particular Section or subsection hereof.
Amendatory Agreement - the Amendatory Agreement dated as of
December 27, 1995, among ▇▇▇▇▇▇ Guaranty Trust Company, the
Company, the Lessee, the Bank and The Chase Manhattan Bank.
Assignment - shall mean the assignment of a Nuclear Fuel
Contract pursuant to Section 4 of the Lease Agreement.
Bank - shall mean The Bank of New York.
Basic Agreements - collectively, the Assignments, the
Lessee's Letter Agreement, the Lessee's Consent, the Lease
Agreement, the Security Agreement and the Trust Agreement, and
shall include the exhibits, schedules and annexes attached to
each of the foregoing.
Business Day - any day other than a Saturday, a Sunday or a
day on which commercial banks in New York City are required or
authorized to be closed.
Calendar Quarter - a calendar quarter ending on the last day
of any March, June, September or December.
Called Principal - See Section 6.2 hereof. For purposes of
this Section 11, such term shall also include the unpaid
principal amount of any Notes which have been declared or have
otherwise become due and payable pursuant to Section 9.2 hereof.
Closing - See Section 2.2 hereof.
Collateral - all property or rights referred to in Section 2
of the Security Agreement in which a security interest is granted
to the Collateral Agent, as pledgee for the ratable benefit of
the Secured Parties, pursuant to the Security Agreement.
Collateral Account - shall have the meaning specified in
Section 3.1 of the Security Agreement.
Collateral Agent - shall have the meaning specified in the
Security Agreement.
Commercial Paper Account - shall have the meaning specified
in Section 1.01 of the Credit Agreement as in effect on the date
hereof.
Company - River Fuel Company #2, Inc., a Delaware
corporation.
Company Documents - See Section 10 hereof.
CP Notes - Promissory notes of the Company sold or to be
sold in the commercial paper market and described as "A Notes" in
Section 1.01 of the Credit Agreement as in effect on the date
hereof.
Credit Agreement - the Credit Agreement dated as of January
31, 1989, between the Company and the Bank, and as the same may
be further modified, supplemented or amended from time to time.
Daily Lease Charge - shall have the meaning set forth in
Section 1 of the Lease Agreement.
Dealer Agreement - the Dealer or Placement Agency Agreement
dated as of January 31, 1989 between the Company and ▇▇▇▇▇▇▇
▇▇▇▇▇ Money Markets Inc., as the same may be modified,
supplemented or amended from time to time.
Default - an event or condition the occurrence of which
would, with the lapse of time or the giving of notice or both,
become an Event of Default.
Depositary Agreement - the Depositary Agreement dated as of
January 31, 1989 between the Company and ▇▇▇▇▇▇ Guaranty Trust
Company of New York, as the same may be modified, supplemented or
amended from time to time.
Disclosure Documents - the Private Placement Memorandum and
the Annual Report on Form 10-K for the year ended December 31,
1997 of Entergy Corporation and the Lessee, their Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1998, June
30, 1998, and September 30, 1998, and Entergy Corporation's
Annual Report to Stockholders for the year ended December 31,
1997.
Discounted Value - shall mean, with respect to the Called
Principal of any Note, the amount obtained by discounting all
Remaining Scheduled Payments with respect to such Called
Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in
accordance with accepted financial practice and at a discount
factor (applied on a semiannual basis) equal to the Reinvestment
Yield with respect to such Called Principal.
Event of Default - See Section 9.1 hereof.
Fuel Schedule - shall have the meaning specified in Section
1 of the Lease Agreement.
IT Notes - all intermediate term secured promissory notes of
the Company (including the Notes) which comply with the
provisions of Section 8.10 hereof.
IT Note Agreements - collectively, the agreements between
the Company and one or more lenders pursuant to which such
lenders have purchased or agreed to purchase any of the IT Notes.
Lease Agreement - the Fuel Lease dated as of January 31,
1989 between the Company and Entergy Louisiana, Inc. (formerly
Louisiana Power & Light Company), as the same may be modified,
supplemented or amended from time to time in accordance with
Section 7.2 hereof.
Lessee - shall mean Entergy Louisiana, Inc., a Louisiana
corporation, as Lessee under the Lease Agreement.
Lessee's Consent - shall mean the Lessee's consent specified
in Section 33(b) of the Lease Agreement.
Lessee's Letter Agreement - See Section 4.2(e) hereof.
Lien - any mortgage, pledge, lien, security interest, title
retention, charge or other encumbrance of any nature whatsoever
(including any conditional sale or other title retention
agreement, any lease in the nature thereof and the filing of or
agreement to execute and deliver any financing statement under
the Uniform Commercial Code of any jurisdiction).
Loan - shall have the meaning specified in Section 1.01 of
the Credit Agreement as in effect on the date hereof.
Loan Notes - the promissory notes issued by the Company to
evidence loans made by the Bank under the Credit Agreement and
described as "B Notes" in Section 1.01 of the Credit Agreement as
in effect on the date hereof.
Manufacturers - shall have the meaning specified in Section
1 of the Lease Agreement.
Noteholder or holder of any Note - the Person in whose name
the Note is registered.
Notes - See Section 2.1 hereof.
Nuclear Fuel - shall have the meaning specified in Section 1
of the Lease Agreement.
Nuclear Fuel Contract - shall have the meaning specified in
Section 1 of the Lease Agreement.
Outstandings - shall have the meaning specified in Section
1.01 of the Credit Agreement as in effect on the date hereof.
Person - an individual, partnership, corporation, trust or
unincorporated organization, and a government or agency or
political subdivision thereof.
Private Placement Memorandum - the Private Placement
Memorandum for River Fuel Company #2, Inc., dated December 1998,
from ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
Property - Any interest in any kind of property or asset
whether real, personal or mixed, or tangible or intangible.
Redemption Date - See Section 6.3 hereof.
Registrar - The Chase Manhattan Bank or such other registrar
and paying agent (being a commercial bank or trust company
authorized to conduct business in the State of New York and
having combined capital and surplus of not less than $25,000,000)
as the Company may appoint to act as registrar and paying agent
in respect of the Notes. The Company shall give written notice
to each Noteholder of the appointment of any successor Registrar.
Reinvestment Yield - shall mean, with respect to the Called
Principal of any Note, the yield to maturity implied by (i) the
yields reported, as of 10:00 A.M. (New York City time) on the
Business Day next preceding the Settlement Date with respect to
such Called Principal, on Bloomberg Page PX3 or PX4 (or such
other display as may replace Bloomberg Page PX3 or PX4) for
actively traded U.S. Treasury securities having a maturity equal
to the Remaining Average Life of such Called Principal as of such
Settlement Date, or (ii) if such yields shall not be reported as
of such time or the yields reported as of such time shall not be
ascertainable, the Treasury Constant Maturity Series yields
reported for the latest day for which such yields shall have been
so reported as of the Business Day next preceding the Settlement
Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor
publication) for actively traded U.S. Treasury securities having
a constant maturity equal to the Remaining Average Life of such
Called Principal as of such Settlement Date. Such implied yield
shall be determined, if necessary, by (a) converting U.S.
Treasury ▇▇▇▇ quotations to bond-equivalent yields in accordance
with accepted financial practice and (b) interpolating linearly
between reported yields.
Remaining Average Life - shall mean, with respect to the
Called Principal of any Note, the number of years (calculated to
the nearest one-twelfth year) obtained by dividing (i) such
Called Principal into (ii) the sum of the products obtained by
multiplying (a) each Remaining Scheduled Payment of such Called
Principal (but not of interest thereon) by (b) the number of
years (calculated to the nearest one-twelfth year) which will
elapse between the Settlement Date with respect to such Remaining
Scheduled Payment and the date on which such Remaining Scheduled
Payment would otherwise be due.
Remaining Scheduled Payments - shall mean, with respect to
the Called Principal of any Note, all payments of such Called
Principal and interest thereon that would be due on or after the
Settlement Date with respect to such Called Principal if no
payment of such Called Principal were made prior to its scheduled
due date.
Secured Parties - shall have the meaning specified in
Section 1.1 of the Security Agreement.
Security - shall have the same meaning as in Section 2(1) of
the 1933 Act.
Security Agreement - the Security and Collateral Agency
Agreement dated as of January 31, 1989, as amended by the
Amendatory Agreement, executed and delivered by the Company in
favor of the Collateral Agent, for the ratable benefit of the
Secured Parties, and the Collateral Chattel Mortgage and the
periodic supplements thereto, the Collateral Chattel Mortgage
Note, the Pledge Agreement and periodic supplements thereto and
the Notice of Security Interest, all as the same may be modified,
supplemented or amended from time to time in accordance with
Section 7.2 hereof.
Series A Note Agreements - the several Note Agreements each
dated as of January 31, 1989 relating to the issue and sale by
the Company of its Intermediate Term Notes, Series A, as from
time to time in effect.
Settlement Date - the Redemption Date or the Acceleration
Date, as the case may be.
SLV - shall have the meaning specified in Section 1 of the
Lease Agreement.
Termination Settlement Date - shall have the meaning
specified in Section 20(b) of the Lease Agreement.
Trust - shall mean River Fuel Trust #2, a trust formed
pursuant to the Trust Agreement.
Trust Agreement - shall mean the Trust Agreement dated as of
January 27, 1989, as amended by the Amendatory Agreement, among
United States Trust Company of New York, as trustee, The Chase
Manhattan Bank, as successor trustor, and Entergy Louisiana,
Inc., as beneficiary.
Trustee - shall mean United States Trust Company of New
York, as trustee of the Trust.
Yield-Maintenance Premium - shall mean, with respect to any
Note, a premium equal to the excess, if any, of the Discounted
Value of the Called Principal of such Note over the sum of (i)
such Called Principal plus (ii) interest accrued thereon as of
(including interest due on) the Settlement Date with respect to
such Called Principal. The Yield-Maintenance Premium shall in no
event be less than zero.
11.2. Accounting Principles. Where the character or amount
of any asset or liability or item of income or expense is
required to be determined or any consolidation or other
accounting computation is required to be made for the purposes of
this Agreement, this shall be done in accordance with generally
accepted accounting principles in effect on the date that this
Agreement was executed, to the extent applicable, except where
such principles are inconsistent with the requirements of this
Agreement.
11.3. Directly or Indirectly. Where any provision in this
Agreement refers to action to be taken by any Person, or which
such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by
such Person including actions taken by or on behalf of any
partnership in which such Person is a general partner.
11.4. Governing Law. This Agreement and the Notes shall be
governed by and construed in accordance with New York law.
12. MISCELLANEOUS.
12.1. Notices. Any notice, demand or other communication
which by any provision of this Agreement is required or provided
to be given shall be deemed to have been delivered if in writing
addressed as provided below and actually delivered by mail,
courier, telex or facsimile to the following addresses:
(1) if to you, at your address shown in Exhibit A to this
Agreement, marked for attention as there indicated, or at such
other address as you may have furnished the Company in writing;
or
(2) if to any other Noteholder, to such address as may be set
forth in the register referred to in Section 5.2 hereof, such
holder being empowered to change its address on the register by
notice in writing to the Company and the Registrar; or
(3) if to the Company, at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, c/o United States Trust Company of New
York, Corporate Trust and Agency Division, or at such other
address as it may have furnished in writing to you and all other
holders of the Notes at the time outstanding; or
(4) if to the Registrar, at The Chase Manhattan Bank, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate
Company Administration, or at such other address as the Company
or the Registrar shall have furnished in writing to you and all
other holders of the Notes at the time outstanding; and
(5) with copies in the case of each such notice, demand or other
communication to the Lessee, at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Treasurer, or at such other address
as the Lessee may have furnished to you and all other holders of
the Notes at the time outstanding and to the Company.
12.2. Counterparts; Reproduction of Documents. This
Agreement may be executed in any number of counterparts, each of
which, when executed and delivered shall be an original, but such
counterparts shall together constitute one and the same
instrument. This Agreement and all documents relating thereto
(except the Notes themselves), including, without limitation, (a)
consents, waivers and modifications which may hereafter be
executed, (b) documents received by you at the closing of your
purchase of the Notes and (c) financial statements, certificates
and other information previously or hereafter furnished to you,
may be reproduced by you by any photographic, photostatic,
microfilm, micro-card, miniature photographic or other similar
process and you may destroy any original document so reproduced.
The Company agrees and stipulates that any such reproduction
shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was
made by you in the regular course of business) and that any
enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.
12.3. Survival. All covenants, agreements, representations
and warranties made by the Company or the Lessee herein or in any
certificate or other instrument delivered by either of them or on
behalf of either of them under this Agreement shall survive the
delivery to you of the Notes regardless of any investigation made
by you or on your behalf. All statements in any such certificate
or other instrument executed and delivered by the Company or the
Lessee shall constitute warranties and representations by the
Company or the Lessee hereunder.
12.4. Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon each of the parties hereto and
their respective successors and assigns. The provisions of this
Agreement are intended to be for the benefit of and binding upon
all holders, from time to time, of any of the Notes, and shall be
enforceable by any such holder, whether or not an express
assignment to such holder of rights under this Agreement has been
made by you or your successor or assign.
12.5. Amendment and Waiver.
(1) Requirements. Any provision in this Agreement or in the
Notes to the contrary notwithstanding, changes in or additions to
this Agreement may be made, and compliance with any covenant or
provision herein set forth may be omitted or waived, if the
Company shall obtain consent thereto in writing from the holder
or holders of not less than 66 2/3% in principal amount of all
Notes at the time outstanding; provided, however, that no such
consent shall (i) reduce the amount of the principal of any of
the Notes or change the amounts or dates of any payment or
redemption of principal due upon any of the Notes or reduce the
rate or extend the time of payment of interest or premium on any
of the Notes, without the consent of the holder of each Note so
affected or (ii) reduce the percentage of Noteholders required to
approve any such amendment or effectuate any such waiver or amend
the provisions of this Section 12.5, without the consent of the
holders of all of the Notes at the time outstanding. Any consent
may be given subject to satisfaction of conditions stated
therein. The Company shall deliver copies of each such consent
to any Noteholder who did not execute the same.
(2) Solicitation of Noteholders. So long as any outstanding
Notes are owned by you, the Company will not solicit, request or
negotiate for or with respect to any proposed waiver or amendment
of any of the provisions of this Agreement or the Notes unless
each Noteholder (irrespective of the amount of Notes then owned
by it) shall be informed thereof by the Company and shall be
afforded the opportunity of considering the same and shall be
supplied by the Company with sufficient information to enable it
to make an informed decision with respect thereto. Executed or
true and correct copies of any waiver or consent effected
pursuant to the provisions of this Section 12.5 shall be
delivered by the Company to each Noteholder forthwith following
the date on which the same shall have been executed and delivered
by the holder or holders of the requisite percentage of
outstanding Notes. The Company will not, directly or indirectly,
pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, to any
Noteholder as consideration for or as an inducement to the
entering into by any holder of the Notes of any waiver or
amendment of any of the terms and provisions of this Agreement
unless such remuneration is concurrently paid, on the same terms,
ratably to the holders of all of the Notes then outstanding.
(3) Binding Effect. Any such amendment or waiver shall apply
equally to all the holders of the Notes and shall be binding upon
them and upon each future holder of any Note and upon the Company
whether or not such Note shall have been marked to indicate such
amendment or waiver. No such amendment or waiver shall extend to
or affect any obligation not expressly amended or waived or
impair any right consequent thereon.
13. AUTHORIZATION OF COLLATERAL AGENT.
You hereby authorize the Collateral Agent to enter into and
to carry out its duties under and with respect to the Security
Agreement and hereby agree to accept and be bound by all of the
provisions thereof including without limitation the provisions
(a) prohibiting the enforcement of the Security Agreement without
the direction or consent of the Designated Holders (as that term
is used in the Security Agreement), (b) limiting the duties of
the Collateral Agent thereunder and exonerating it from certain
liabilities, (c) permitting amendments to the Security Agreement
and waivers and releases of Collateral thereunder and (d)
providing that under certain circumstances the Noteholders shall
be responsible for their respective pro rata shares of expenses
of the Collateral Agent as set forth in Section 6.8 of the
Security Agreement.
If this Agreement is satisfactory to you, please so indicate
by signing the acceptance at the foot of a counterpart of this
Agreement and return such counterpart to the Company whereupon
this Agreement will become binding between us in accordance with
its terms.
Very truly yours,
RIVER FUEL COMPANY #2, INC.
By:________________________
Title: President
Accepted:
METROPOLITAN LIFE INSURANCE
COMPANY
By:________________________
Title:
EXHIBIT A
PURCHASER INFORMATION
Name and Address Registered Principal Amount of
of Purchaser Number Notes to be Purchased
Metropolitan Life Insurance $35,000,000
Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Purchaser's Tax ID: ▇▇-▇▇▇▇▇▇▇
(1) All payments on account of the above Notes in accordance
with the provisions thereof and of this Agreement shall be
transmitted, not later than 12:00 noon, New York time, on the
date such payment is due by bank wire or inter-bank transfer
of immediately available funds for credit to:
The Chase Manhattan Bank
ABA #▇▇▇▇▇▇▇▇▇
Metropolitan Life Insurance Company
Account No. 002-2-410591
Contemporaneous with the above wire transfer, advice setting forth:
(1) the full name, interest rate and maturity date and PPN of the Notes or
other obligations;
(2) allocation of payment between principal, Yield-Maintenance Premium and
interest and any special payment; and
(3) name and address of bank from which wire transfer was sent, a contact name
and telephone number.
(2) Copies of all notices and confirmations of payments shall be delivered
or mailed to:
Metropolitan Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Private Placements Unit
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT B
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS
REGISTERED UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT.
RIVER FUEL COMPANY #2, INC.
Intermediate Term Secured Note, Series B
Due January 15, ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇
BR-________ PPN 76822
$__________ _____________
RIVER FUEL COMPANY #2, INC. (the "Company"), a Delaware corporation, FOR VALUE
RECEIVED, hereby promises to pay to __________________________________ or
registered assigns (hereinafter referred to as the "Payee") on January 15,
2002 the principal amount of _____________________________________Dollars
($_________) or such part thereof as then remains unpaid and to
pay interest on the unpaid balance of such principal amount from
the date of this Note at the rate of 6.16% per annum, payable
semi-annually on the 15th day of January and July in each year,
commencing July 15, 1999, and on the maturity date hereof until
such principal amount shall be paid. The Company further
promises to pay to the Payee on demand a late charge of 1% of any
principal (including any required redemption), Yield-Maintenance
Premium (as defined in the Agreement hereinafter referred to),
and interest not paid when due, to cover the administrative costs
of the Payee related to collecting and accounting for late
payments, so far as the same may be legally enforceable.
Interest shall be computed on the basis of a 360-day year and a
30-day month.
Payments of principal and interest and Yield-Maintenance Premium, if any, shall
be made in lawful money of the United States of America by wire
transfer or check mailed, as the Payee may direct the Company in
writing, to the office of the Payee, or at such other place in
the United States of America as the Payee shall have designated
to the Company in writing.
This Note is one of an issue of Intermediate Term Secured
Notes, Series B, of the Company originally issued in the
aggregate principal amount of $35,000,000 pursuant to the
provisions of a Note Agreement dated as of January 15, 1999
between the Company and the Purchaser named therein (hereinafter
referred to as the "Agreement"). The holder of this Note is
entitled to the benefits of the Agreement and may enforce each of
the agreements of the Company as contained therein and may
exercise each of the remedies provided thereby, or otherwise
available in respect thereof, against the Company, but neither
this reference to the Agreement nor any provision thereof shall
affect or impair the absolute and unconditional obligation of the
Company to pay the principal amount hereof and interest and Yield-
Maintenance Premium, if any, hereon as herein provided. As
provided in the Agreement (i) this Note is subject to redemption,
in whole or in part, in certain cases with a Yield-Maintenance
Premium, and (ii) in case of an Event of Default, as defined in
the Agreement, the principal of this Note may become or may be
declared due and payable in the manner and with the effect
provided in the Agreement. The Company agrees to make required
redemptions on account of this Note in accordance with the
provisions of the Agreement.
This Note is an IT Note referred to in the Security and
Collateral Agency Agreement, dated as of January 31, 1989, as
amended, between the Company and The Chase Manhattan Bank, as
collateral agent for the ratable benefit of the holder of this
Note and the other Secured Parties named therein (the "Security
Agreement"). The holder of this Note is entitled to the benefits
of the Collateral (as defined in the Security Agreement), and the
rights of the holder hereof in the Collateral are subject to and
governed by the provisions of the Security Agreement, and the
holder hereof shall not have any rights with respect to the
Collateral except to the extent and in the manner provided in the
Security Agreement.
As further provided in the Agreement, upon surrender of this
Note for transfer or exchange, a new Note or new Notes of the
same tenor (except for the name of the holder) dated the date to
which interest has been paid on this Note, or dated the date of
this Note if no interest has theretofore been paid hereon, and in
an aggregate principal amount equal to the unpaid principal
amount of this Note will be issued to, and registered in the name
of, the transferee or transferees. The Company and the Registrar
(as defined in the Agreement) may treat the person in whose name
this Note is registered as the owner hereof for the purpose of
receiving payment and for all other purposes, and the Company
shall not be affected by any notice to the contrary.
The Company and all endorsers of this Note hereby waive
presentment, demand, notice of nonpayment, protest and, except as
provided in Section 9 of the Agreement, all other demands and
notices in connection with the delivery, acceptance, performance
or enforcement of this Note.
This Note is governed by and shall be construed in
accordance with New York law.
RIVER FUEL COMPANY #2, INC.
By:___________________________
Title:
EXHIBIT C
CERTIFICATE OF
ENTERGY LOUISIANA, INC.
This Certificate is being delivered to the purchaser named in Exhibit A to the
Note Agreement referred to below (the "Purchaser") by Entergy
Louisiana, Inc. (the "Lessee"), pursuant to Section 4.2(b)(ii) of
the Note Agreement, dated as of January 15, 1999 (the "Note
Agreement"), between River Fuel Company #2, Inc., a Delaware
corporation (the "Company"), and the Purchaser, relating to the
issue and sale of $35,000,000 in original aggregate principal
amount of the Notes. Terms defined in the Note Agreement are
used herein with the same meanings ascribed to them therein,
unless otherwise defined herein.
In connection with the purchase of the Notes pursuant to the Note Agreement, the
Lessee DOES HEREBY REPRESENT AND CERTIFY that:
1. The Lessee acknowledges receipt of a conformed counterpart
of the Note Agreement and familiarity with the provisions, terms
and conditions thereof.
2. Since September 30, 1998, there has been no material adverse
change in the Lessee's business or financial condition.
3. The execution, delivery and performance, or the acceptance,
as the case may be, by the Lessee of all Basic Agreements to be
executed by it and the Nuclear Fuel Contracts did not and will
not violate any provision of any law or regulation or of any writ
or decree of any court or governmental instrumentality applicable
to the Lessee and no consent, license, approval, order or
authorization of, or filing, registration or declaration with,
any governmental authority, bureau or agency or any court or
other Person is required in connection with the execution,
delivery, performance, acceptance, validity or enforceability of
any of the above-mentioned documents and instruments (provided
that no representation is given with respect to the Nuclear Fuel
Contracts insofar as the respective Manufacturers are concerned),
except for (i) a general license to own Nuclear Fuel from the
Nuclear Regulatory Commission (currently granted under 10 C.F.R.
Sections 40.21 and 70.20), (ii) a license to possess and use
special nuclear material granted by the Nuclear Regulatory
Commission, (iii) orders of the Securities and Exchange
Commission under the Public Utility Holding Company Act of 1935,
as amended, and (iv) official action of approval or non-
opposition by the Louisiana Public Service Commission, all of
which licenses, orders, approvals and filings have been duly
obtained or made and are final and in full force and effect,
provided that no representation is given with respect to federal,
New York or Louisiana banking or trust laws or regulations or the
securities or blue sky laws or regulations of any State.
4. The representations and warranties of the Lessee contained
in Section 2 of the Lease Agreement are true, correct and
complete in all material respects on and as of the date hereof.
On the date hereof the information contained in the Private
Placement Memorandum and the other Disclosure Documents does not
include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading. The amount of the Lessee's shareholder's
equity has not declined below the amount shown on its balance
sheet as of September 30, 1998. The Lessee's income before
extraordinary items, as shown on its income statement for the
nine months ended September 30, 1998, is a positive number.
5. Each of the Basic Agreements to which the Lessee is a party
and each of the Nuclear Fuel Contracts with respect to the
Nuclear Fuel listed in Schedule A to the Lease Agreement (as
Schedule A is amended to the date hereof by Fuel Schedules Nos.
30 through 47) is in full force and effect without amendment or
modification (other than as disclosed in the Note Agreement).
6. No default or "Event of Default" under the Lease Agreement
or event described in Section 20(a) of the Lease Agreement has
occurred.
7. As of the date hereof and after giving effect to the sale of
Notes to which this Certificate relates, the aggregate SLV of the
Nuclear Fuel plus any accrued Daily Lease Charges plus cash and
investments held in the Collateral Account equals or exceeds the
sum of the Outstandings under the Credit Agreement plus the
aggregate outstanding principal amount of all IT Notes, as set
forth in Annex A hereto.
8. The Lessee has requested that the funds being made available
to the Company pursuant to the Note Agreement on the date hereof
be applied for the purposes and on the date set forth below, any
balance to be applied to the purchase of additional nuclear fuel:
Proposed Date
Purpose Amount of Payment
Payment of maturing $25,000,000 February 1,1999
Series A Notes
9. The Notes are not secured by any collateral other than the
Collateral described in the Security Agreement, and the Notes are
not guaranteed directly or indirectly by any Person nor are the
Noteholders assured against loss or nonpayment in any manner
other than as contemplated by the Security Agreement and the
other Basic Agreements. The Note Agreement does not contain any
provision, term or condition which is inconsistent with, or
contrary to, the Security Agreement, or which would violate, or
cause the Company to be in violation of, the Credit Agreement or
any other Basic Agreement and the Notes purchased and sold
pursuant to the Note Agreement will constitute "IT Notes" as that
term is defined in Section 11.1 of the Note Agreement.
IN WITNESS WHEREOF, the undersigned, a duly authorized
officer, has signed this Certificate on behalf of the Lessee this
____ day of January, 1999.
ENTERGY LOUISIANA, INC.
By:________________________________
Title:
ANNEX A
1. Aggregate SLV of Nuclear Fuel as of 1/22/98 $74,560,000
2. Estimated Fuel Amortization from 1/1/99 to 1/22/99 (1,800,000)
3. Estimated accrued Daily Lease Charges at 1/22/99 350,000
4. Cash and investments in Collateral Account at 1/22/99 35,020,000
5. Total of (1) through (4) 108,130,000
6. Outstandings under Credit Agreement at 1/22/99 48,066,000
7. Aggregate amount of IT Notes (including the Series A and B
Notes) on 1/22/99 60,000,000
8. Total of (6) plus (7) 108,066,000
EXHIBIT D
As of January__, 1999
To the Purchaser Named in the Agreement
referred to below
Re:River Fuel Company #2, Inc.
Intermediate Term Secured Notes,
6.16% Series B, Due January 15, 2002
Gentlemen:
Terms used herein shall have the same meanings ascribed to them in the Note
Agreement dated as of January 15, 1999 between you and River Fuel
Company #2, Inc. (the "Agreement").
So long as any of the Notes shall remain outstanding, the Lessee hereby agrees
that:
(1) without your prior written consent,
(1) it shall not obtain the release of Nuclear Fuel from the
Lease Agreement pursuant to Section 10(b) thereof in an amount
which, after giving effect to the use of the proceeds received by
the Company for the Nuclear Fuel, shall cause the sum of (i) the
aggregate unpaid principal amount of all outstanding IT Notes,
plus (ii) all Outstandings or any other outstanding bank
indebtedness of the Company to exceed the aggregate SLV of the
Nuclear Fuel plus accrued Daily Lease Charges plus cash and
investments held in the Collateral Account (such excess amount
being hereinafter referred to as a "Collateral Deficiency"),
(2) it shall not agree to any affirmative or negative covenant
with respect to the business, operations, properties or
condition, financial or other, of the Lessee with any Person in
order to induce such Person to extend credit to the Company,
unless (x) such covenant is in existence on the date hereof and a
copy of the document containing such covenant has been provided
to you or (y) such covenant is contained in the Lease Agreement,
and
(3) it shall not provide to any Person in order to induce such
Person to extend credit to the Company, any collateral other than
the Collateral described in the Security Agreement or any
guarantee or other assurance against loss or non-payment, nor
shall it cause the Company to provide such additional collateral,
guarantee or assurance (or consent to the provision thereof by
the Company) unless, in each case, all IT Notes shall have
equally and ratably the benefit of such additional collateral,
guarantee or assurance, and
(2) within 24 months following the occurrence of an event set
forth in Sections 18 or 19 of the Lease Agreement, it shall
effect the Restoration (as defined in the Lease Agreement) of the
Nuclear Fuel which is subject to such event if the occurrence of
such event would cause a Collateral Deficiency to exist, and
(3) it shall transmit to each IT Noteholder copies of its and
Entergy Corporation's Annual Reports on Form 10-K, their
Quarterly Reports on Form 10-Q, their Current Reports on Form 8-
K, Entergy Corporation's Annual Reports to shareholders, and such
other financial information as may be publicly available and as
such IT Noteholder may reasonably request, and
(4) pursuant to Sections 13(b) and 33 of the Lease Agreement, it
shall give written instructions to the Company to file or to
cause to be filed all continuation statements required under the
Uniform Commercial Code, as from time to time in effect in each
applicable jurisdiction, or other applicable law with respect to
the liens and security interests granted under the Security
Agreement in order to maintain, protect, preserve and perfect the
Collateral Agent's lien on and security interest in the
Collateral as a legal, valid and enforceable first priority
security interest therein, and it shall cause the Company to give
evidence to the Collateral Agent of the due recordation of such
continuation statements prior to the date for the timely
recordation of such continuation statements.
Very truly yours,
ENTERGY LOUISIANA, INC.
By:___________________________
Title: