UNITED STATES OF AMERICA
BEFORE THE SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
In the Matter of :
:
ENTERGY ARKANSAS, INC. : CERTIFICATE PURSUANT
:
File No. 70-7571 : TO
:
Public Utility Holding Company : RULE 24
Act of 1935
:
This is to certify, pursuant to Rule 24 under the Public
Utility Holding Company Act of 1935, as amended, that the
transactions described below, which were proposed by Entergy
Arkansas, Inc. ("Company") in its Application-Declaration, as
amended, in the above file, have been carried out in accordance
with the terms and conditions of and for the purposes represented
by said Application-Declaration, as amended, and pursuant to the
orders of the Securities and Exchange Commission with respect
thereto dated December 20, 1988 (Release No. 35-24787), July 7,
1989 (Release No. 35-24917) and January 24, 1996 (Release No. 35-
26461).
On March 17, 1999, the Company executed a Consent consenting
to the issuance by River Fuel Trust #1 (the "Trust") of
$25,000,000 in aggregate principal amount of Intermediate Term
Secured Notes, 6.52% Sercies D, dued March 15, 2002 (the "Series
D Notes"). The Company also executed Supplemntal Instructions to
United States Trust Company of New York, as Trustee (the
"Trustee") pursuant to the Trust Agreement, dated as of December
22, 1988, among Morgan Guaranty Trust Company of New York, as
trustor, the Trustee and the Company, as beneficiary, authorizing
the Trustee to cause the Trust to enter into Secured Note
Agreements with the Noteholders named therein for the sale of the
Series D Notes.
Attached hereto and incorporated by reference are:
Exhibit B-1(e) - Consent pursuant to Fuel Lease.
Exhibit B-2(e) - Supplemntal Instructions pursuat to
Trust Agreement.
Exhibit B-4(e) - Secured Note Agreement in the form
entered into between the Trust and the
Noteholders.
Exhibit B-6(e) - Letter Agreement executed by the
Company.
Defined terms used herein and not otherwise defined shall
have the meanings ascribed to them in the Application.
IN WITNESS WHEREOF, Entergy Arkansas, Inc. has caused this
certificate to be executed this 29th day of March 1999.
ENTERGY ARKANSAS, INC.
By: /s/ Steven C. McNeal
Steven C. McNeal
Vice President and
Treasurer
Exhibit B-1(e)
LESSEE'S CONSENT
Pursuant to Section 33(d) of the Fuel Lease, dated as of
December 22, 1988, between River Fuel Trust #1 ("Lessor") and
Entergy Arkansas, Inc. ("Lessee"), Lessee hereby consents to
Lessor's execution and delivery of four separate Note Purchase
Agreements, each dated as of March 17, 1999, with Metropolitan
Life Insurance Company, Security First Life Insurance Company,
Nationwide Life Insurance Company and Nationwide Life and Annuity
Insurance Company, as Purchasers, relating to the issue and sale
of $25,000,000 aggregate principal amount of Lessor's
Intermediate Term Secured Notes, 6.52% Series D, due March 15,
2002.
ENTERGY ARKANSAS, INC.
By: Steven C. McNeal
Dated: March 17, 1999
Exhibit B-2(e)
SUPPLEMENTAL INSTRUCTIONS
PURSUANT TO
TRUST AGREEMENT
DATED DECEMBER 20, 1988
These Supplemental Instructions, dated March 17, 1999, are
given pursuant to the Trust Agreement, dated as of December 20,
1988, as amended, among The Chase Manhattan Bank, as successor
Trustor, United States Trust Company of New York, as Trustee and
Entergy Arkansas, Inc., as Beneficiary, under which River Fuel
Trust #1 (the "Trust") was formed.
WHEREAS, the Trust Agreement contemplates the delivery by
the Beneficiary to and acceptance by the Trustee of Supplemental
Instructions with respect to the execution and delivery of
agreements, acceptance of assignments of agreements or rights,
acquisition of properties and entering into certain transactions
by the Trust, in accordance with lawful requests of the
Beneficiary; and
WHEREAS, the Beneficiary now desires to give Supplemental
Instructions to the Trustee as herein set forth:
NOW, THEREFORE, the Beneficiary hereby gives, and the
Trustee by its signature hereto hereby accepts, the following
Supplemental Instructions:
The Trust is authorized and directed to take all
actions necessary to authorize the issuance of
$25,000,000 aggregate principal amount of the Trust's
Intermediate Term Secured Notes, 6.52% Series D, Due
March 15, 2002 at a closing scheduled on or about March
18, 1999.
Section 1. Definitions. For the purpose of these
Supplemental Instructions, the capitalized terms used herein and
not otherwise defined herein shall have the meanings set forth in
the Trust Agreement.
Section 2. Authorization and Direction to Accept and/or
execute Documents or Rights. The Trust is authorized and
directed:
1) To accept, execute and deliver to the Purchasers named
therein four Note Agreements, substantially in the form attached
hereto, relating to the issuance of $25,000,000 aggregate
principal amount of Intermediate Term Secured Notes, 6.52% Series
D, Due March 15, 2002 and to perform all of the obligations and
duties of the Trust thereunder; and
1) 2) To execute and deliver to the aforesaid Purchasers the
Series D Notes referred to above upon receipt of the $25,000,000
consideration therefor, all in accordance with said Note
Agreements, and to execute and deliver all other certificates and
instruments required of the Trust at the closing referred to in
the aforesaid Note Agreements.
Section 3. Use of Proceeds. The proceeds received upon the
issuance of the aforesaid Series D Notes shall be deposited in
the Collateral Account and thereafter shall be applied toward the
purchase price of Nuclear Fuel in accordance with the directions
of the Lessee.
Section 4. Confirmation of Trust. The Trustee hereby
confirms by its execution hereof that the declaration of trust
embodied in Section 3 of the Trust Agreement shall apply fully to
all rights, estates, properties, assets, payments or proceeds
received or obtained by the Trustee pursuant to these
Supplemental Instructions.
Section 5. Other Provisions. Except as herein expressly
provided, all of the terms and provisions of the Trust Agreement
shall as nearly as may be practicable apply to all rights and
obligations obtained or incurred by the Trustee pursuant to these
Supplemental Instructions.
IN WITNESS WHEREOF, the parties hereto have executed these
Supplemental Instructions as of the day and year first written
above.
ENTERGY ARKANSAS, INC.
By: Steven C. McNeal
ACCEPTED:
UNITED STATES TRUST COMPANY
OF NEW YORK, AS TRUSTEE
By: Louis B. Young
Exhibit B-4(e)
RIVER FUEL TRUST #1
___________________
NOTE AGREEMENT
___________________
Dated as of March 17, 1999
$25,000,000
INTERMEDIATE TERM SECURED NOTES
6.52% Series D, Due March 15, 2002
<PAGE>
TABLE OF CONTENTS
Page
1. DEFINITIONS. 1
2. PURCHASE AND SALE OF THE NOTES. 1
2.1. The Notes 1
2.2. Other Purchasers 2
2.3. The Closing 2
2.4. Use of Proceeds 2
2.5. Purchase for Investment 3
3. REPRESENTATIONS AND WARRANTIES. 3
3.1. Organization, Authorization of the Trust 3
3.2. Due Execution and Delivery 3
3.3. Financial Statements; Business 4
3.4. Title to Properties 4
3.5. Litigation 4
3.6. Conformity with Other Agreements 4
3.7. No Legal Obstacle to Agreement 5
3.8. Investment Company Status 5
3.9. Absence of Foreign Status 6
3.10. Private Offering 6
3.11. Disclosure 6
3.12. No Default 7
3.13. Security 7
3.14. Permitted Indebtedness 7
4. CLOSING CONDITIONS. 7
4.1. Condition Precedent to Trust's Obligations 7
4.2. Conditions Precedent to Your Obligations 7
5. PAYMENT, REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT OF
THE NOTES 9
5.1. Payment Address 9
5.2. Registration, Transfer or Exchange 10
5.3. Replacement 10
6. REDEMPTION PROVISIONS 11
6.1. Mandatory Redemption upon Termination of Lease
Agreement 11
6.2. Optional Redemption of Notes 11
6.3. Notice of Redemption 11
6.4. Payment and Interest Cut-Off 12
6.5. Permanent Retirement of Notes 12
6.6. Selection of Notes for Redemption 12
6.7. Repurchase of Notes 12
7. TERMINATION OF LEASE AGREEMENT; AMENDMENT OF BASIC
AGREEMENTS AND NUCLEAR FUEL CONTRACTS; ADDITIONAL COVENANTS12
7.1. Termination of Lease Agreement 12
7.2. Basic Agreements and Nuclear Fuel Contracts 12
7.3. Additional Covenants 13
8. COVENANTS 13
8.1. General Obligations 13
8.2. Books of Trust 13
8.3. Notices 13
8.4. Payment of Taxes 13
8.5. Governmental Permits 14
8.6. Inspection 14
8.7. Financial Statements 14
8.8. Copies of Documents 14
8.9. Activities of Trust 14
8.10. Indebtedness 14
8.11. Guarantees 16
8.12. Liens 16
8.13. Distributions 16
8.14. Investments; Loans 16
8.15. Salaries 16
8.16. Merger; Sales 16
8.17. Payments 16
8.18. Compliance with Agreements 16
8.19. Acceptance of Additional Nuclear Fuel Contracts17
8.20. Investment Company 17
8.21. Public Utility Holding Company 17
8.22. Accounts and Deposits 17
8.23. Expenses and Indemnity 17
9. EVENTS OF DEFAULT; CONSEQUENCES 18
9.1. Events of Default 18
9.2. Default Remedies 20
9.3. Annulment of Acceleration 21
9.4. Notice of Default 21
10. CONCERNING THE TRUSTEE 21
10.1. Trustee Not Personally Liable 21
10.2. Successor Trustee 22
10.3. Representations; Covenants 22
11. INTERPRETATION OF THIS AGREEMENT 23
11.1. Terms Defined 23
11.2. Accounting Principles 28
11.3. Counterparts; Reproduction of Documents 28
11.4. Survival 28
11.5. Successors and Assigns 28
11.6. Amendment and Waiver 28
11.7. No Recourse 29
11.8. Choice of Law; Severability; etc 30
11.9. Notices. 30
11.10. Entire Agreement; No Oral Change 31
11.11. Authorization of Collateral Agent 31
Exhibit A Schedule of Purchasers
Exhibit B Form of Note
Exhibit C Form of Certificate of the Lessee
Exhibit D Form of Letter Agreement by the Lessee
Exhibit E-1 Opinion of Carter Ledyard & Milburn
Exhibit E-1A Opinion of Carter Ledyard & Milburn
Exhibit E-2 Opinion of Friday, Eldredge & Clark
Exhibit E-3 Opinion of Thelen Reid & Priest LLP
Exhibit E-4 Opinion of Ropes & Gray
<PAGE>
RIVER FUEL TRUST #1
c/o UNITED STATES TRUST COMPANY
OF NEW YORK, as trustee
114 WEST 47th STREET, 15th Floor
NEW YORK, NEW YORK 10036
As of March 17, 1999
To Each of the Purchasers
Listed in Exhibit A hereto
Re: Intermediate Term Secured Notes, 6.52%
Series D, Due March 15, 2002
Dear Sirs:
River Fuel Trust #1 (the "Trust"), a trust formed pursuant
to the Trust Agreement, dated as of December 20, 1988, as amended
by the Amendatory Agreement, dated as of December 27, 1995 (the
"Trust Agreement"), among United States Trust Company of New
York, as trustee (the "Trustee"), The Chase Manhattan Bank, as
successor trustor (the "Trustor"), and Entergy Arkansas, Inc.
(formerly, Arkansas Power & Light Company, the "Lessee"), as
beneficiary (the "Beneficiary"), 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 Trust Agreement authorizes the issuance
of IT Notes and the Trust proposes to issue and sell at the
Closing the Trust's Intermediate Term Secured Notes, 6.52% Series
D, due March 15, 2002, in the original aggregate principal amount
of $25,000,000 pursuant to the provisions of this Agreement and
of an identical Agreement with each of the other Purchasers
listed in Exhibit A hereto (each of such purchasers being
hereinafter referred to individually as a "Purchaser" and such
purchasers being hereinafter referred to collectively as the
"Purchasers"). The term "Notes" shall mean said $25,000,000 of
Intermediate Term Secured Notes, Series D, due March 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 the denomination of $1,000 or an integral multiple
thereof, shall be dated the date of its issuance, and shall bear
interest on the unpaid principal amount thereof from the date of
issuance at the rate of 6.52% per annum (computed on the basis of
a 360-day year and a 30-day month), payable semiannually in
arrears on the 15th day of March and September in each year,
commencing September 15, 1999, and shall be executed in the name
and on behalf of the Trust by one of the Trustee's Vice
Presidents or Assistant Vice-Presidents thereunto duly
authorized.
2.2. Other Purchasers. Contemporaneously with the execution of
this Agreement, the Trust is executing an identical (except for
the name of the Purchaser) agreement with each other Purchaser
pursuant to which the Trust will issue and sell Notes to such
other Purchaser in the aggregate principal amount set opposite
the name of such Purchaser in Exhibit A hereto. The sale of the
Notes to each Purchaser is a separate transaction in which each
Purchaser shall act for itself severally and not jointly with the
other Purchasers. Such identical agreements with you and with
the other Purchasers are sometimes hereinafter referred to as the
"Agreements".
2.3. The Closing. The Trust agrees to issue and sell to you,
in reliance upon your representations and warranties in Section
2.5 hereof, and subject to the terms and conditions and in
reliance upon the representations and warranties of the Trust 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 Trust at the Closing the principal amount of
Notes set opposite your name and specified in Exhibit A hereto
for purchase by you, in each case at a price equal to 100% of
such principal amount. The time for delivering and payment for
the Notes (the "Closing") shall be at 9:30 A.M., New York time,
at the offices of Ropes & Gray, 885 Third Avenue, New York, New
York on March 18, 1999 (or such later date, not in any case later
than March 31, 1999, as you, the other Purchasers and the Trust
may agree upon). 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. 910-2-
745792 (entitled the "River Fuel Trust #1 Collateral Account") at
The Chase Manhattan Bank, ABA No. 021000021. If at the Closing
the Trust 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.
2.4. Use of Proceeds. The Trust 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 to be applied toward the expenses of the issuance of the
Notes and the purchase price of additional Nuclear Fuel in
accordance with the directions of the Lessee. The Trust 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 the Agreements
or the sale of the Notes to violate 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 Trust.
2.5. Purchase for Investment. You represent and warrant to the
Trust that 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 acknowledge receipt of a copy of the
Private Placement Memorandum dated February, 1999 relating to the
Notes. Your acquisition of the Notes at the Closing shall
constitute your confirmation of said representation and warranty.
3. REPRESENTATIONS AND WARRANTIES.
The Trust represents and warrants that:
3.1. Organization, Authorization of the Trust. The Trust is a
trust duly created and validly existing under the laws of the
State of New York 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 the Agreements, to issue
and sell the Notes and to carry out the terms of the Agreements
and the Notes and of the Credit Agreement, the Depositary
Agreement and each of the Basic Agreements. The Trust has all
necessary power and has taken all action required to make all of
the provisions of the Agreements, 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 Trustee or the Trust Estate
is bound, the valid and binding obligations of the Trust that
they purport to be.
3.2. Due Execution and Delivery. The Agreements, the Notes,
the Credit Agreement, the Depositary Agreement and each of the
Basic Agreements to which the Trust is a party and the other
certificates and documents signed or to be signed on behalf of
the Trust by the Trustee have been or will be duly executed and
delivered by one of the Trustee's employees who is, or at the
time of the execution and delivery thereof on behalf of the Trust
will be, duly authorized to effect such execution and delivery,
and all such agreements, certificates and documents (collectively
"Documents") when executed and delivered will be legal, valid and
binding obligations of the Trust, 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 or whether such enforceability is
considered in a proceeding in equity or at law).
3.3. Financial Statements; Business. The Trust has furnished
you a copy of its statement of receipts and disbursements for the
year ended [December 31, 1998] and, by the Closing, the Trust
shall provide you a pro forma balance sheet as at the date of the
Closing, taking into account the sale of Notes hereunder, the
application of the proceeds thereof and the other transactions
contemplated hereby and by the Basic Agreements. The Trust is
not a party to any instrument providing for the incurrence by the
Trust of indebtedness for money borrowed other than the Credit
Agreement, the Basic Agreements and the Depositary Agreement.
The Trust has transacted no business except that which is
contemplated by the Credit Agreement, the Basic Agreements and
the agreements referred to therein. The chief place of business
of the Trust and the place where it keeps its records concerning
its accounts, contract rights, chattel paper and general
intangibles is in New York County, New York. The Trust's only
place of business is in New York State.
3.4. Title to Properties. The Trust will have title to all of
the Trust's assets owned or purported to be owned by the Trust 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. 90 through 102, inclusive, to the Lease Agreement as of the
date of the Closing, other than any such Nuclear Fuel that has
been reconveyed to the Lessee, 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 Trust (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 Trustee threatened, which may result in any material
judgment or liability against the Trust 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 Trust, or which questions the validity or enforceability
of the Agreements, 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 Trust pursuant to or in
connection with the Agreements, the Credit Agreement, the
Depositary Agreement or the Basic Agreements; and no judgment,
decree or order has been issued against the Trust or the Trustee
which has, or may have, any material adverse effect on the
business, assets or condition, financial or other, of the Trust.
3.6. Conformity with Other Agreements. The Agreements do not
contain any provision, term or condition which is inconsistent
with, or contrary to, the Security Agreement, or which would
violate, or cause the Trust to be in violation of, the Credit
Agreement, the Depositary Agreement or any of the Basic
Agreements. Neither the execution and delivery of the Agreements
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 Trust or the Trustee is
bound or result in the creation under any agreement or instrument
of any Lien upon any of the assets of the Trust, 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
Trust of this Agreement, the Credit Agreement, the Basic
Agreements, the Nuclear Fuel Contracts, and the Notes 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 Trust, 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 for the Trust to own Nuclear
Fuel from the Nuclear Regulatory Commission (currently granted
under 10 C.F.R. Sections 40.21 and 70.20), and (ii) the Orders
dated December 20, 1988, July 7, 1989 and January 24, 1996, of
the Securities and Exchange Commission ("SEC") authorizing the
Lessee to consent to the issuance of up to $185 million 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 Trustee's
knowledge, any threatened attack by direct proceedings or
otherwise; and except for a special license to possess Nuclear
Fuel from the Nuclear Regulatory Commission that the Trust or the
Collateral Agent may require to take possession of the Nuclear
Fuel in the event of a default, provided that no representation
is given with respect to Federal, New York or Arkansas banking or
trust laws or regulations or the securities or blue sky laws or
regulations of any State.
3.8. Investment Company Status. The Trust 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 Trust 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, and the offer and sale of the Notes, do not require an
indenture to be qualified under said Act.
3.9. Absence of Foreign Status, etc..
(1) Absence of Foreign Status. Neither the Trust nor the
Trustee is (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 Asset 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 Trust 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 Trust 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 Trustee nor, to the
knowledge of the Trustee, the Lessee nor any Person authorized or
employed by any of them as agent, broker, dealer or otherwise
(the only such agent being Merrill Lynch) 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, the other Purchasers,
and, to the knowledge of the Trustee, based on the representation
of Merrill Lynch, other offerees who at the time of such offer
were "accredited investors" as defined in Rule 501 under the
Securities Act of 1933, as amended. The Trust 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 Securities Act of 1933, as amended.
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 Section 3.4 hereof or in
any other document, certificate, or statement furnished to you by
or on behalf of the Trust 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 Trustee which has not been disclosed
herein or therein and which materially adversely affects or in
the future, so far as the Trustee can foresee, may so affect, the
business, assets or condition, financial or otherwise, of the
Trust.
3.12. No Default. No default or Event of Default has
occurred under the Credit Agreement and, to the knowledge of the
Trustee, no event of termination has occurred under Section 20 of
the Lease Agreement as of 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
Trust's right, title and interest in the Nuclear Fuel Contracts
and the Nuclear Fuel referred to in the Fuel Schedules referred
to in Section 3.4 hereof, including, without limitation, any
Nuclear Fuel to be acquired, stored, fabricated or processed with
the funds being made available to the Trust pursuant to the
Agreements, other than any such Nuclear Fuel that has been
reconveyed to the Lessee, 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
representation 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 the
Agreements at the Closing, the aggregate SLV of the Nuclear Fuel
plus any accrued Daily Lease Charges plus cash and equivalents 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.
4. CLOSING CONDITIONS.
4.1. Condition Precedent to Trust's Obligations. The Trust's
obligation to issue and deliver the Notes to be delivered to you
at the Closing shall be subject to the receipt by the Trust at or
prior to the time of the Closing of (1) supplemental instructions
of the Lessee authorizing the Trust to execute and deliver the
Agreements and to issue and sell the Notes; (2) the consent of
the Lessee to the execution and delivery by the Trust of the
Agreements and the issuance of the Notes; and (3) copies of the
opinions of Friday, Eldredge & Clark and Thelen Reid & 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 the opinions of Carter Ledyard & Milburn, counsel for the
Trustee, substantially in the form of Exhibits E-1 and E-1A
hereto, respectively, Friday, Eldredge & Clark and Thelen Reid &
Priest LLP, counsel for the Lessee, substantially in the form of
Exhibits E-2 and E-3 hereto, respectively, and Ropes & Gray, your
special counsel, substantially in the form of Exhibit E-4 hereto.
(2) Representations True.
(1) The representations and warranties contained in Section
3 hereof and otherwise made by or on behalf of the Trust in
writing in connection with the transactions contemplated hereby
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 an Event of Default shall have
occurred and be continuing at the time of Closing.
(2) You shall have received a certificate in the form of
Exhibit C hereto signed by the Lessee and the representations and
warranties of the Lessee contained therein shall be true and
correct at and as of the time of the Closing.
(3) Compliance with this Agreement. The Trust shall have
performed and complied with all agreements and conditions
contained herein which are required to be performed or complied
with by the Trust before or at the Closing.
(4) Trust's Certificate. You shall have received at the
Closing a certificate dated the date thereof and signed by or on
behalf of the Trust, certifying that the conditions specified in
Sections 4.2(b)(i) and 4.2(c) have been fulfilled.
(5) Lessee's Letter Agreement. You shall have received at
the Closing a letter agreement substantially in the form of
Exhibit D to this Agreement (the "Lessee's Letter Agreement")
signed by the Lessee.
(6) Simultaneous Sales. At the Closing the Trust shall
have simultaneously sold to the other Purchasers the principal
amount of the Notes set opposite their respective names in
Exhibit A hereto and shall have received from them payment
therefor.
(7) 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 life insurance
companies under all applicable insurance laws 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.
(8) 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 Commissions) shall have been obtained for the Notes.
(9) Payment of Fees. The Trust shall have made
satisfactory arrangements for the payment of the legal fees and
expenses of your special counsel, Ropes & Gray.
(10) 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, and the Basic Agreements, in form satisfactory to you,
shall have been executed and delivered to you prior to or at the
Closing. 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.
(11) Information. The Trust 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.
5. PAYMENT, REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT OF
THE NOTES.
5.1. Payment Address. The Trust shall make or shall cause the
Registrar to make all payments on account of interest, Yield-
Maintenance Premium, if any, and principal to be paid in respect
of the Notes held by each of the Purchasers by wire transfer in
immediately available funds on the scheduled payment date at the
payment address of such Purchaser specified in Exhibit A hereto,
or in such other manner and at such other address as shall be
designated by notice to the Trust and the Registrar in respect of
Notes held by any Purchaser or by any other 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 Trust (or, at the Trust'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 Trust of
the name and address of the transferee.
5.2. Registration, Transfer or Exchange. So long as any of the
Notes remain unpaid, the Trust shall cause the Registrar to keep
at its office referred to in Section 11.9 hereof (or at such
other office of the Registrar within the State of New York as the
Trust 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 the
Agreements and neither the Trust nor the Registrar shall be
affected by any notice to the contrary. For the purpose of any
request, direction or consent hereunder, the Trust 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 Securities Act of 1933, as amended, or any other applicable
law relating to the sale of securities and the Trust 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 Securities Act of 1933, as
amended, and if applicable, any state securities laws. 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 Securities Act of 1933, as amended, the cost of such
opinion shall be borne by the Trust. Within a reasonable time
thereafter and without expense (other than transfer taxes, if
any) to such holder, the Trust 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 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 Trust
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 Trust 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 Trust, or,
in the case of any such mutilation, upon surrender and
cancellation of such Note, the Trust 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 nominees 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 Trust and the
Registrar of a new Note in replacement of such lost, stolen or
destroyed Note other than your written agreement to indemnify the
Trust and the Registrar.
6. REDEMPTION PROVISIONS. The Trust 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 Trust 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. In the event of a purchase
of Nuclear Fuel by the Lessee pursuant to Section 10(f) of the
Lease Agreement, the Trust shall redeem or shall cause the
Registrar to redeem without premium only that portion of the
principal amount of the Notes at the time outstanding which bears
the same relationship to the aggregate principal amount of all IT
Notes at the time outstanding as the SLV of the Nuclear Fuel
affected by such partial termination bears to the SLV of all
Nuclear Fuel. Upon any partial redemption of the Notes, each
Noteholder shall, if so requested by the Trust 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. Except as
provided in this Section 6.1 or in Section 6.2 hereof, neither
the Trust 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 the provisions
of Section 6.6 hereof, the Trust shall, at the request of the
Lessee, redeem or shall cause the Registrar to redeem the entire
principal amount of the Notes outstanding, or any portion thereof
equal to or greater than $500,000 (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.
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 Trust
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 the 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 the holders of Notes to be
redeemed not later than 12:00 noon (New York City time) 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 Trust 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 the 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
Trust 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 Trust or the Registrar shall be
permanently retired and canceled and shall not under any
circumstances be reissued or resold.
6.6. Selection of Notes for Redemption. Each redemption
required by the Agreements 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 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 Trust 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 Trust 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 Trust 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 66 2/3% in aggregate principal amount of
all IT Notes at the time outstanding.
7.2. Basic Agreements and Nuclear Fuel Contracts. The Trust
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 66
2/3% in aggregate principal amount of all IT Notes at the time
outstanding.
7.3. Additional Covenants. The Trust shall not agree to any
affirmative or negative covenant with respect to the business,
operations, properties or condition, financial or otherwise, of
the Trust with any Person who shall extend or propose to extend
credit to the Trust 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 11.6(a), such covenant is contained in an amendment of
or supplement to the Agreements or one of the Basic Agreements.
8. COVENANTS. Without limiting any other covenants and
provisions hereof, the Trust 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 Trust 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 Trust and the rights, privileges and franchises
of the Trust 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 the
Agreements, the Notes and the Basic Agreements to which it is a
party.
8.2. Books of Trust. The Trust 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 Trust 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
Trustee in its capacity as Trustee of the Trust, or affecting the
Trust or any of its assets; and (iii) such other information
concerning the business, assets or condition, financial or
otherwise, of the Trust as any Noteholder may from time to time
reasonably request.
8.4. Payment of Taxes. The Trust will cause to be computed,
paid and discharged (subject to the provisions of Section 10.1
hereof) when due all taxes, assessments and other governmental
charges or levies imposed upon the Trust, or upon any income or
assets of the Trust, prior to the day on which penalties are
attached thereto, unless and 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 Trust 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 the Agreements, the Notes or any of the Basic
Agreements.
8.6. Inspection. The Trust will permit any Person designated
by any Noteholder to inspect any of the Trust's Property (subject
to the provisions of Section 12 of the Lease Agreement) or any of
the books or financial records of the Trust and to discuss the
affairs, finances and accounts of the Trust with the officers of
the Trust or the Trust's independent certified public
accountants, all at such reasonable times and as often as any
Noteholder may reasonably request.
8.7. Financial Statements. The Trust will furnish to each
Noteholder, within 30 days after the close of each Calendar
Quarter, a statement of receipts and disbursements relating to
the Trust for such quarter and for the portion of the fiscal year
then ended.
8.8. Copies of Documents. The Trust 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 Trust, 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 Dealer Agreement), to
the extent that the same shall not have been delivered to such
Noteholder pursuant thereto.
8.9. Activities of Trust. The Trust 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, the
Agreements, the Depositary Agreement and the Basic Agreements.
8.10. Indebtedness. The Trust 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,
(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
Trust 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 sum
of (a) the aggregate SLV of the Nuclear Fuel plus (b) any accrued
Daily Lease Charges plus (c) cash and investments held by the
Trust 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 depositing funds in
the Commercial Paper Account, which funds 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 $250,000,000 less the
aggregate principal amount of the IT Notes outstanding at
such time, evidenced by one or more IT Notes each of which
complies with all of the following requirements: No IT Note
shall constitute permitted indebtedness of the Trust unless
(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 sum of (a) the aggregate SLV of the Nuclear Fuel plus
(b) any accrued Daily Lease Charges plus (c) cash and
investments held by the Trust 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).
8.11. Guarantees. The Trust 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 Trust will not create, incur, assume or
suffer to exist any Lien upon or with respect to any of the
Trust'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 Trust Estate.
8.13. Distributions. The Trust will not declare or pay any
distribution (whether in cash or in Property) with respect to the
profits, assets or capital of the Trust or the Trustor's or the
Beneficiary's interest therein.
8.14. Investments; Loans. The Trust 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 a 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 Trust will not pay any salaries or
wages.
8.16. Merger; Sales. The Trustee on behalf of the Trust
will not enter into any transaction providing for the merger,
consolidation, termination, liquidation or dissolution of the
Trust or the acquisition of the Trust by any Person, or otherwise
change the form or organization of the Trust's business, or
convey, sell, lease or otherwise dispose of any of the Trust's
Property or business, except (i) for transactions contemplated by
the Lease Agreement, (ii) for Liens permitted by Section 8.12
hereof or (iii) in connection with the appointment of a co-
trustee, separate trustee or successor trustee pursuant to
Section 10.2 hereof.
8.17. Payments. The Trust 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 Basic
Agreements, 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 Trust 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 Trust shall, upon the written instructions
of the Lessee, file or cause to be filed all continuation
statements required under the Uniform Commercial Code, 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
Trust 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 Trust 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 Trust will not
be 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.
8.22. Accounts and Deposits. The Trust 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 Trust
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 the
Agreements and the Notes, and also in connection with any
amendments of or waivers under the Agreements or the Notes or the
Basic Agreements, 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 the Agreements or of
the Basic Agreements, the Trust will pay or cause to be paid all
such taxes and any interest and penalties related thereto
(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 Trust under this Section 8.23 shall survive
the payment of the Notes. In no event shall the Trust 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 the
Agreements:
(1) Principal Payments. The Trust fails to make any
payment of any part of the principal of, or the Yield-Maintenance
Premium, if any, on, any of the Notes 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 Trust 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 Trust (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 or
(ii) fails to provide the notice required by Section 8.3(i) of
this Agreement, and any such failure shall continue for a period
of fifteen days from the date on which an officer of the Trustee
first acquired knowledge of the event requiring such notice; or
(4) Other Defaults. The Trust fails to comply with any
other provision of the Notes or of the Agreements, and such
failure shall continue for more than thirty days after the
earlier of (i) written notice thereof shall have been given to
the Trust by any Noteholder or (ii) knowledge thereof by an
officer of the Trustee; or
(5) Representations or Warranties. Any representation or
warranty made by or on behalf of the Trust or the Lessee
contained in the Agreements or in any instrument furnished in
compliance with or in reference to the Agreements, 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 Trust is declared to be,
or otherwise becomes, due and payable (other than at the option
of the Trust) prior to its stated maturity or regularly 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 Trust 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 Trust, 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, 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 Trust, 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 Trust
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 Trust 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 11.6
hereof. If the Trust 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 the Agreements, the
Trust 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
the Agreements.
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 Trust, 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 the Agreements;
(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 11.6 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
Trustee shall have actual knowledge in respect of, an alleged
Default or Event of Default, or if the Trustee acquires knowledge
of any Default or of any Event of Default, the Trustee 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 Trustee 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. CONCERNING THE TRUSTEE.
10.1. Trustee Not Personally Liable. United States Trust
Company of New York is entering into the Agreements and issuing
the Notes solely as trustee under the Trust Agreement and
pursuant to instructions contained in the Trust Agreement and not
in its individual capacity and in no case whatsoever shall an
institution or Person acting as the Trustee (or any entity acting
as successor trustee, co-trustee or separate trustee under the
Trust Agreement) or the Trustor be personally liable on, or for
any loss in respect of, the Notes or any of the statements,
representations, warranties, agreements or obligations of the
Trust or the Trustee hereunder, as to all of which you agree to
look solely to the Trust, except for any loss caused by the
willful misconduct or gross negligence of United States Trust
Company of New York (provided that this exception shall not be
deemed to apply to the extent that United States Trust Company of
New York has followed instructions given to it, or which it is
authorized to accept, pursuant to the Trust Agreement and
provided that United States Trust Company of New York shall be
entitled to rely without independent investigation on information
and calculations provided to it by the Lessee). The obligation
of the Trustee to make payments hereunder shall be solely from
the Trust Estate, and nothing contained herein shall be deemed to
impose obligations on the Trustee other than those expressly set
forth in the Agreements, the Notes and the Basic Agreements.
10.2. Successor Trustee. You hereby agree that if a
successor trustee is appointed in accordance with the terms of
the Trust Agreement, such successor trustee shall, without
further act, succeed to all the rights, duties, immunities and
obligations of the trustee hereunder and the predecessor trustee
shall be released from all further duties and obligations
hereunder, all without in any way altering the terms of this
Agreement, the Notes or the Basic Agreements. The Trustee under
the Trust Agreement or any successor trustee thereunder may from
time to time appoint one or more co-trustees or separate trustees
pursuant to the terms of the Trust Agreement to exercise or hold
any or all of the rights, powers and title of the Trustee
hereunder, without in any way altering the terms of this
Agreement, the Notes or the Basic Agreements. One such
appointment and designation of a successor trustee, co-trustee or
separate trustee shall not exhaust the right to appoint further
successor trustees, co-trustees or separate trustees pursuant to
the Trust Agreement, and such right may be exercised repeatedly
so long as this Agreement shall be in effect. At least one
trustee shall at all times be (a) a corporation in good standing
and organized and doing business under the laws of any state of
the United States of America, or (b) a bank or trust company in
good standing and organized and doing business under the laws of
the United States of America or any state thereof, which, in the
case of (a) and (b), has its principal office in the City of
Boston or the Borough of Manhattan, and total assets of at least
$500,000,000, if there be such an institution willing, able and
legally qualified to perform the duties of the Trustee hereunder
upon reasonable or customary terms, and which is a corporation
authorized under the laws of its jurisdiction of incorporation to
exercise corporate trust powers and is subject to supervision or
examination by Federal or state authority.
10.3. Representations; Covenants. The representations,
warranties and covenants of the Trust contained in Sections 3 and
8 hereof are made solely by the Trust and not by United States
Trust Company of New York in its individual capacity and certain
of said representations and warranties are made solely in
reliance upon the representations of the Lessee contained or to
be contained in the certificate of the Lessee referred to in
Section 4.2(b)(ii) hereof or in other certificates of the Lessee,
copies of which have heretofore been furnished to you.
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 the Agreements pursuant to which the Notes are originally
issued, every other instrument which the Trust and the holders of
the Notes execute at any time which shall amend such Agreements,
and the words "hereof", "hereunder", "herein" and other like
expressions refer to such Agreements as so amended as a whole and
not to any particular Section or subsection thereof.
Assignment - shall mean the assignment of a Nuclear Fuel
Contract pursuant to Section 4 of the Lease Agreement.
Bank - shall mean Union Bank of Switzerland, New York
Branch.
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.
Beneficiary - See the introductory paragraph hereof.
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 2.3 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 Agent - shall have the meaning specified in the
Security Agreement.
Collateral Account - shall have the meaning specified in
Section 3.1 of the Security Agreement.
Company Documents - See Section 11.7 hereof.
Commercial Paper Account - shall have the meaning specified
in Section 1.01 of the Credit Agreement as in effect on the date
hereof.
CP Notes - Promissory notes of the Trust 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 December
22, 1988, as amended by Amendment dated September 24, 1996,
between the Trust and the Bank, and as modified, supplemented,
amended or extended 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 December 22, 1988 between the Trust and Merrill Lynch
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
December 22, 1988 between the Trust and The Chase Manhattan Bank
(as successor Depository), as the same may be modified,
supplemented or amended from time to time.
Disclosure Documents - (i) the Private Placement Memorandum,
(ii) the Annual Report on Form 10-K for the year ended December
31, 1997 of Entergy Arkansas, Inc. and its Quarterly Reports on
Form 10-Q for the quarters ended March 31, 1998, June 30, 1998
and September 30, 1998, and (iii) the Annual Report on Form 10-K
of Entergy Arkansas, Inc. for the year ended December 31, 1998.
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 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 Trust (including the Notes) which comply with the provisions
of Section 8.10 hereof.
IT Note Agreements - collectively, the agreements between
the Trust 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 December 22,
1988 between the Trust and Entergy Arkansas, Inc. (formerly
Arkansas Power & Light Company), as the same may be modified,
supplemented or amended from time to time in accordance with
Section 7.2 hereof.
Lessee - See the introductory paragraph hereof.
Lessee's Consent - shall mean the Lessee's consent specified
in Section 33(d) 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 Notes - the promissory notes issued by the Trust 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.
Merrill Lynch - Merrill Lynch, Pierce, Fenner & Smith
Incorporated, doing business as Merrill Lynch & Co.
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 Trust #1 dated February, 1999, prepared
by Merrill Lynch.
Property - any interest in any kind of property or asset
whether real, personal or mixed, or tangible or intangible.
Purchaser - See Section 2.1 hereof.
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 Trust may appoint to act as registrar and paying agent in
respect of the Notes. The Trust 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 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 Life of such Called
Principal as of such Settlement Date. Such implied yield shall
be determined, if necessary, by (a) converting U.S. Treasury bill
quotations to bond-equivalent yields in accordance with accepted
financial practice and (b) interpolating linearly between
reported yields.
Remaining Life - shall mean, with respect to the Called
Principal of any Note, the number of years (calculated to the
nearest one-twelfth year) which will elapse between the
Settlement Date with respect to such Called Principal and March
15, 2002.
Remaining Scheduled Payments - shall mean, with respect to
the Called Principal of any Note, such Called Principal and any
payments of 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 Securities Act of 1933, as amended.
Security Agreement - the Security and Collateral Agency
Agreement dated as of December 22, 1988, as amended, executed and
delivered by the Trust in favor of the Collateral Agent, for the
ratable benefit of the Secured Parties, as the same may be
modified, supplemented or amended from time to time in accordance
with Section 7.2 hereof.
Settlement Date - shall mean 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 - See the introductory paragraph hereof.
Trust Agreement - See the introductory paragraph hereof.
Trust Estate - shall have the meaning specified in Section 1
of the Trust Agreement.
Trustee - See the introductory paragraph hereof.
Trustor - See the introductory paragraph hereof.
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 at the time 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. 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,
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
(except the Notes themselves), 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 Trust 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.
11.4. Survival. All covenants, agreements, representations
and warranties made by the Trust 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 Trust or the
Lessee shall constitute warranties and representations by the
Trust or the Lessee hereunder.
11.5. 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 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.
11.6. Amendment and Waiver.
(1) Requirements. Any provision in the Agreements or in
the Notes to the contrary notwithstanding, changes in or
additions to the Agreements or the Notes may be made, and
compliance with any covenant or provision herein or therein set
forth may be omitted or waived, if the Trust 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 Sections
9.2(a) or 9.3 or this Section 11.6 hereof, 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 Trust 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 Trust 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 Trust and
shall be afforded the opportunity of considering the same and
shall be supplied by the Trust 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 11.6 shall be
delivered by the Trust 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 Trust 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 Trust 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.
11.7. No Recourse. The Agreements, the Notes and any other
document executed and delivered by the Trust in connection
therewith (the "Company Documents") are intended to be
obligations of the Trust only, and all of the statements,
representations, covenants and agreements made by the Trust
contained therein are made and intended only for the purpose of
binding the Trust and establishing the existence of rights and
remedies provided for herein or therein which can be exercised
and enforced against the Trust. Therefore, anything contained in
the Agreements, the Notes, or any other document to the contrary
notwithstanding, no claim may be made by any Noteholder against
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
United States Trust Company of New York with respect to claims
against the Trust arising under or relating to this Agreement.
Nothing in this Section 11.7 shall relieve the Trust from its
obligations under the Company Documents nor prevent recourse by
any Noteholder against United States Trust Company of New York,
as trustee or in its individual capacity with respect to claims
arising out of its own willful misconduct or gross negligence as
provided in Section 6.1(b) of the Trust Agreement, nor prevent
recourse by any Noteholder against the Lessee in connection with
the exercise or enforcement by any Noteholder of any rights or
remedies under any of the Basic Agreements as provided therein.
11.8. Choice of Law; Severability; etc. This Agreement
shall be governed by and construed in accordance with the
domestic substantive laws of the State of New York without giving
effect to any choice or conflict of law provisions or rule that
would cause the application of the domestic substantive laws of
any other jurisdiction. This Agreement sets forth the entire
understanding of the parties hereto with respect to the
transactions contemplated hereby. In the event that any
provision hereof would, under applicable law, be invalid or
unenforceable, such provision shall, to the extent permitted
under applicable law, be construed by modifying or limiting it so
as to be valid and enforceable to the maximum extent possible
under applicable law. The provisions of this Agreement are
severable, and in the event that any provision hereof should be
held invalid or unenforceable in any respect, it shall not
invalidate, render unenforceable or otherwise affect any other
provision hereof. The headings in this Agreement are for
convenience of reference only and shall not alter or otherwise
affect the meaning hereof.
11.9. Notices. Any notice, demand or other communication
in connection with the Agreements shall be deemed to have been
delivered if in writing (or in the form of telex or telecopy)
addressed as provided below and actually delivered by mail,
courier, telex or facsimile to the following addresses:
(1) if to you, at your notice address shown in Exhibit A to
this Agreement, marked for attention as there indicated, or at
such other address as you may designate by notice in writing
received by the Trustee; 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 received by the Registrar; or
(3) if to the Trust, in care of United States Trust Company
of New York, 114 West 47th Street, 15th Floor, New York, New York
10036, Attention: Corporate Trust Department, or at such other
address as it may designate by notice received by you and all
other holders of the Notes at the time outstanding; or
(4) if to the Registrar, at The Chase Manhattan Bank, 1
Chase Manhattan Plaza, New York, New York 10081, or at such other
address as the Trust or the Registrar may designate by notice in
writing received by you and all other holders of Notes at the
time outstanding; and
(5) with copies in the case of each such notice, demand or
other communication to the Lessee, at TCBY Tower, 425 West
Capital Avenue, Little Rock, AR 72201, or at such other address
as the Lessee may designate by notice in writing received by you
and all other holders of Notes at the time outstanding.
11.10. Entire Agreement; No Oral Change. This Agreement,
together with any other writing signed by the parties expressly
stated to be supplementary hereto and together with the
instruments and certificates to be delivered to you pursuant to
this Agreement, constitute the entire agreement between you and
the Trust with respect to the subject matter hereof, superseding
all prior understandings and writings relating thereto, and may
not be changed orally.
11.11. Authorization of Collateral Agent. You hereby
authorize the Collateral Agent and its successors 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 Trustee whereupon
this Agreement will become binding between us in accordance with
its terms.
Very truly yours,
RIVER FUEL TRUST #1
By: UNITED STATES TRUST COMPANY
OF NEW YORK, as Trustee
By:
Vice President
Accepted:
[NAME OF PURCHASER]
By: ______________________
Title:
<PAGE>
EXHIBIT A
SCHEDULE OF PURCHASERS
Name and Address Registered Principal Amount of
of Purchaser Number Notes to be Purchased
Metropolitan Life Insurance DR-001 $19,000,000
Company
One Madison Avenue
New York, New York 10010
Purchaser's Tax ID: 13-5581829
(1) All payments on account of the 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 #021000021
Metropolitan Life Insurance Company
Account No. 002-2-410591
Contemporaneous with the above wire transfer, advice setting
forth:
(1) the full name, interest rate, maturity date and PPN of
the Notes;
(2) allocation of payment among 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
334 Madison Avenue
Convent Station, New Jersey 07961-0633
Attention: Private Placements Unit
Facsimile: (973) 254-3050
<PAGE>
EXHIBIT A
SCHEDULE OF PURCHASERS
Name and Address Registered Principal Amount of
of Purchaser Number Notes to be Purchased
Security First Life Insurance DR-002 $1,000,000
Company
c/o Metropolitan Life Insurance
Company
334 Madison Avenue
Convent Station, New Jersey 07961
Purchaser's Tax ID: 54-0696644
(1) All payments on account of the 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:
Security First Life Insurance Company
Account No. 328175
The Bank of New York
ABA No. 021000018
BNF: IOC566
Contemporaneous with the above wire transfer, advice setting
forth:
(1) the full name, interest rate, maturity date and PPN of
the Notes;
(2) allocation of payment among 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:
Security First Life Insurance Company
c/o Metropolitan Life Insurance Company
334 Madison Avenue
Convent Station, New Jersey 07961-0633
Attention: Private Placements Unit
Facsimile: (973) 254-3050
<PAGE>
EXHIBIT A
SCHEDULE OF PURCHASERS
Name and Address Registered Principal Amount of
of Purchaser Number Notes to be Purchased
Nationwide Life Insurance DR-003 $3,500,000
Company
One Nationwide Plaza (1-33-07)
Columbus, Ohio 43215-2220
Attention: Corporate Fixed-Income
Securities
Facsimile: (614) 249-4553
Purchaser's Tax ID: 31-4156830
(1) All payments on account of the 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 Bank of New York
ABA #021-000-018
BNF: IOC566
F/A/O Nationwide Life Insurance Company
Attention: P&I Department
PPN 76824* AM 6
Security Description: River Fuel Trust #1, Intermediate Term
Secured Notes, 6.52% Series D Due March 15, 2002
Contemporaneous with the above wire transfer, advice
setting forth:
(1) the full name, interest rate, maturity date and PPN of
the Notes;
(2) allocation of payment among 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:
Nationwide Life Insurance Company
c/o The Bank of New York
P.O. Box 19266
Attention: P&I Department
Newark, NJ 07195
with a copy to:
Nationwide Life Insurance Company
Attention: Investment Accounting
One Nationwide Plaza (1-32-05)
Columbus, Ohio 43215-2220
<PAGE>
EXHIBIT A
SCHEDULE OF PURCHASERS
Name and Address Registered Principal Amount of
of Purchaser Number Notes to be Purchased
Nationwide Life and DR-004 $1,500,000
Annuity Insurance Company
One Nationwide Plaza (1-33-07)
Columbus, Ohio 43215-2220
Attention: Corporate Fixed-Income
Securities
Facsimile: (614) 249-4553
Purchaser's Tax ID: 31-1000740
(1) All payments on account of the 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 Bank of New York
ABA #021-000-018
BNF: IOC566
F/A/O Nationwide Life and Annuity Insurance Company
Attention: P&I Department
PPN 76824* AM 6
Security Description: River Fuel Trust #1, Intermediate Term
Secured Notes, 6.52% Series D Due March 15, 2002
Contemporaneous with the above wire transfer, advice
setting forth:
(1) the full name, interest rate, maturity date and PPN of
the Notes;
(2) allocation of payment among 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:
Nationwide Life and Annuity Insurance Company
c/o The Bank of New York
P.O. Box 19266
Attention: P&I Department
Newark, NJ 07195
with a copy to:
Nationwide Life and Annuity Insurance Company
Attention: Investment Accounting
One Nationwide Plaza (1-32-05)
Columbus, Ohio 43215-2220
<PAGE>
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 TRUST #1
Intermediate Term Secured Note, 6.52% Series D
Due March 15, 2002
PPN 76824* AM 6
New York, NY
DR- _____
$_____________
__________[Date]______
RIVER FUEL TRUST #1 (the "Trust"), a trust formed pursuant
to the Trust Agreement dated as of December 20, 1988 among United
States Trust Company of New York, as trustee, the successor
Trustor and the Beneficiary named therein, FOR VALUE RECEIVED,
hereby promises to pay to ______________________________________
or registered assigns (hereinafter referred to as the "Payee") on
March 15, 2002 the principal amount of _____________ Dollars
($_____________) 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 6.52% per annum,
payable semiannually in arrears on the 15th day of March and
September in each year, commencing on the March 15 or September
15 next succeeding the date hereof, until such principal amount
shall be paid. The Trust further promises to pay to the Payee on
demand interest on overdue principal, Yield-Maintenance Premium
(as defined in the Agreements hereinafter referred to), if any,
and, to the extent permitted by applicable law, interest on
overdue installments of interest at a rate per annum equal to the
stated rate of interest hereon plus 1% per annum. Interest shall
be computed on the basis of a 360-day year and a 30-day month.
Payments of principal, Yield-Maintenance Premium and
interest shall be made in lawful money of the United States of
America by wire transfer or check mailed, as the Payee may direct
the Trust 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 Trust in writing.
This Note is one of an issue of Intermediate Term Secured
Notes, 6.52% Series D, due March 15, 2002, of the Trust
originally issued in the aggregate principal amount of
$25,000,000 pursuant to the provisions of separate but identical
(except for the name of the Purchaser) Note Agreements dated as
of March 17, 1999 between the Trust and the Purchasers named
therein (hereinafter referred to as the "Agreements"). The
holder of this Note is entitled to the benefits of the Agreements
and may enforce each of the agreements of the Trust as contained
therein and may exercise each of the remedies provided thereby,
or otherwise available in respect thereof, against the Trust, but
neither this reference to the Agreements nor any provision
thereof shall affect or impair the absolute and unconditional
obligation of the Trust to pay the principal amount hereof and
interest and Yield-Maintenance Premium, if any, hereon as herein
provided. As provided in the Agreements (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 Agreements, the principal of this Note may become
or may be declared due and payable in the manner and with the
effect provided in the Agreements. The Trust agrees to make
required redemptions on account of this Note in accordance with
the provisions of the Agreements.
This Note is an IT Note referred to in the Security and
Collateral Agency Agreement dated as of December 22, 1988, as
amended, between the Trust and The Chase Manhattan Bank, as
successor collateral agent for the ratable benefit of the holder
of this Note and the other Secured Parties named therein (as the
same may be hereafter modified or amended, 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 Agreements, 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, 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 Trust or the Registrar (as
defined in the Agreements) 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 Trust shall
not be affected by any notice to the contrary.
The Trust and all endorsers of this Note hereby waive
presentment, demand, notice of nonpayment, protest and, except as
provided in Section 9 of the Agreements, all other demands and
notices in connection with the delivery, acceptance, performance
or enforcement of this Note.
As more fully provided in the Agreements, the institution or
person acting as trustee of the Trust shall not be personally
liable to the holder hereof for any amounts payable under this
Note and such holder shall look solely to the Trust Estate
created by the Trust Agreement referred to above to satisfy the
obligations created hereby.
This Note is governed by and shall be construed in
accordance with New York law.
RIVER FUEL TRUST #1
By: UNITED STATES TRUST COMPANY
OF NEW YORK, as Trustee
By:______________________________________
Title:
<PAGE>
EXHIBIT C
CERTIFICATE
OF
ENTERGY ARKANSAS, INC.
This Certificate is being delivered to the purchasers named
in Exhibit A to each of the Note Agreements referred to below
(the "Purchasers") by Entergy Arkansas, Inc. (the "Lessee"),
pursuant to Section 4.2(b)(ii) of the separate Note Agreements,
each dated as of March 17, 1999 (the "Note Agreements"), between
River Fuel Trust #1, a trust formed pursuant to a Trust Agreement
dated as of December 20, 1988, as amended, among United States
Trust Company of New York, as trustee (the "Trustee"), The Chase
Manhattan Bank, as successor trustor, and the Lessee, as
beneficiary, and each of the Purchasers referred to therein,
relating to the issue and sale of $25,000,000 in original
aggregate principal amount of the Intermediate Term Secured
Notes, 6.52% Series D due March 15, 2002 ("Series D Notes").
Terms defined in the Note Agreements or the Basic Agreements are
used herein with the same meanings ascribed to them therein,
unless otherwise defined herein.
In connection with the purchase of the Series D Notes
pursuant to the Note Agreements, the Lessee DOES HEREBY REPRESENT
AND CERTIFY, that:
1. The Lessee acknowledges receipt of conformed
counterparts of the Note Agreements and familiarity with the
provisions, terms and conditions thereof.
2. Since December 31, 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 executed by it and of 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, and (iii) Orders,
dated December 20, 1988, July 7, 1989 and January 24, 1996,
respectively, of the Securities and Exchange Commission under the
Public Utility Holding Company Act of 1935, as amended; provided
that no representation is given with respect to Federal, New York
or Arkansas 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, and the
information contained in the Private Placement Memorandum of
Merrill Lynch & Co., dated February, 1999 are true and correct in
all material respects on and as of the date hereof with the same
force and effect as though made on and as of the date hereof, and
(x) the amount of the Lessee's shareholder's equity has not
declined below the amount shown on its balance sheet as of
December 31, 1998, and (y) the Lessee's income before
extraordinary items, as shown on its income statement for the
year ending December 31, 1998, is a positive number.
5. Each of the Basic Agreements to which the Lessee is a
party is in full force and effect without amendment or
modification, other than the Amendatory Agreement, dated
December 27, 1995 and the Amendment dated September 24, 1996 to
the Credit 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 immediately after giving
effect to the sale of Series D Notes to which this Certificate
relates, the aggregate SLV of the existing Nuclear Fuel plus any
accrued Daily Lease Charges plus cash and equivalents 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.
All of the existing Nuclear Fuel consists entirely of the fuel
assemblies designated by the Lessee as batches 15, 16, 17, 14(P),
15(R) and 16(S) at the Generating Facility and all such existing
Nuclear Fuel is located at the Generating Facility. The SLV of
the existing Nuclear Fuel located at the Generating Facility as
of March 16, 1999, was $91,796,000.
8. The Lessee has requested that the funds being made
available to the Trust pursuant to the Note Agreements on the
date hereof be applied toward the purchase price of Nuclear Fuel
in accordance with the directions of the Lessee.
9. The IT Notes are not secured by any collateral other
than the Collateral described in the Security Agreement, and the
IT 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 Agreements do not contain
any provision, term or condition which is inconsistent with, or
contrary to, the Security Agreement, or which would violate, or
cause the Trust to be in
violation of, the Credit Agreement or any other Basic Agreement
and the Series D Notes purchased and sold pursuant to the Note
Agreements will constitute "IT Notes", as that term is defined in
Section 11.1 of the Note Agreements.
In Witness Whereof, the undersigned, a duly authorized
officer, has signed this Certificate on behalf of the Lessee this
18th day of March, 1999.
Entergy Arkansas, Inc.
By:___________________________
Title:
<PAGE>
Annex A to Exhibit C
1. Aggregate SLV of Nuclear Fuel as of 3/16/99 $ 91,796,000
2. Estimated Amortization from 3/1/99
to 3/18/99 $ (2,644,000)
3. Receivable from EAI - 1/1/99 through 3/18/99 $ 7,000,000
4. Estimated Accrued Daily Lease Charges at 3/18/99 $ -
5. Cash and Equivalents in Collateral Account at 3/18/99 $ 25,000,000
6. Total of (1) through (5) $121,152,000
7. Outstandings under Credit Agreement at 3/18/99 $ 55,829,000
8. Aggregate principal amount of IT Notes as of 3/18/99
(including the Series C and Series D Notes) $ 65,000,000
9. Total of (7) plus (8) $120,829,000
<PAGE>
EXHIBIT D
March 18, 1999
To the Purchasers on Exhibit A
to each of the Agreements
referred to below
Re: River Fuel Trust #1,
Intermediate Term Secured Notes,
6.52% Series D, Due March 15, 2002
Gentlemen:
Terms used herein shall have the same meanings ascribed to
them in the Note Agreements dated as of March 17, 1999 between
each of you and River Fuel Trust #1 (the "Agreements").
So long as any of the Notes shall remain outstanding, the
Lessee hereby agrees that:
(A) 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 Trust for the
Nuclear Fuel, shall cause the sum of (i) the aggregate
unpaid principal amount of all outstanding IT Notes,
plus (ii) all Outstandings to exceed the aggregate SLV
of the Nuclear Fuel plus accrued Daily Lease Charges
plus cash and investments held by the Trust (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 Trust, 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 Trust, 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
Trust to provide such additional collateral, guarantee
or assurance (or consent to the provision thereof by
the Trust) unless, in each case, all IT Notes shall
have equally and ratably the benefit of such additional
collateral, guarantee or assurance,
(B) 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;
(C) it shall transmit to each 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 Noteholder may reasonably
request; and
(D) pursuant to Sections 13(b) and 33 of the Lease
Agreement, it shall give written instructions to the Trust 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, 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 Trust to give evidence to each Noteholder of the
due recordation of such continuation statements prior to the date
for the timely recordation of such continuation statements.
Very truly yours,
ENTERGY ARKANSAS, INC.
By:__________________________________
Title:
Exhibit B-6(e)
March 18, 1999
To the Purchasers on Exhibit A
to each of the Agreements
referred to below
Re: River Fuel Trust #1,
Intermediate Term Secured Notes,
6.52% Series D, Due March 15, 2002
Gentlemen:
Terms used herein shall have the same meanings ascribed to
them in the Note Agreements dated as of March 17, 1999 between
each of you and River Fuel Trust #1 (the "Agreements").
So long as any of the Notes shall remain outstanding, the
Lessee hereby agrees that:
(A) 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 Trust for the
Nuclear Fuel, shall cause the sum of (i) the aggregate
unpaid principal amount of all outstanding IT Notes,
plus (ii) all Outstandings to exceed the aggregate SLV
of the Nuclear Fuel plus accrued Daily Lease Charges
plus cash and investments held by the Trust (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 Trust, 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 Trust, 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
Trust to provide such additional collateral, guarantee
or assurance (or consent to the provision thereof by
the Trust) unless, in each case, all IT Notes shall
have equally and ratably the benefit of such additional
collateral, guarantee or assurance,
(B) 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;
(C) it shall transmit to each 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 Noteholder may reasonably
request; and
(D) pursuant to Sections 13(b) and 33 of the Lease
Agreement, it shall give written instructions to the Trust 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, 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 Trust to give evidence to each Noteholder of the
due recordation of such continuation statements prior to the date
for the timely recordation of such continuation statements.
Very truly yours,
ENTERGY ARKANSAS, INC.
By: Steven C. McNeal
Title: Vice President and Treasurer
