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Exhibit 10.1
 
Execution Version
 
 

RIO GRANDE RESOURCES TRUST II
(El Paso Electric Company, guarantor)
 
$65,000,000
Senior Guaranteed Notes
 
4.07% Senior Guaranteed Notes, due August 15, 2025

NOTE PURCHASE AGREEMENT
 

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Dated as of June 28, 2018
 

 

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TABLE OF CONTENTS
 
Section
 
Page
1.
AUTHORIZATION OF NOTES.
1
     
2.
SALE AND PURCHASE OF NOTES.
1
     
3.
CLOSING.
2
     
4.
CONDITIONS TO CLOSING.
2
 
4.1
Representations and Warranties.
2
 
4.2
Performance; No Default.
2
 
4.3
Compliance Certificates.
3
 
4.4
Opinions of Counsel.
3
 
4.5
Purchase Permitted by Applicable Law, etc.
3
 
4.6
Sale of Other Notes.
4
 
4.7
Payment of Special Counsel Fees.
4
 
4.8
Private Placement Numbers.
4
 
4.9
Changes in Organization Structure.
4
 
4.10
Funding Instructions.
4
 
4.11
Proceedings and Documents.
4
       
5.
REPRESENTATIONS AND WARRANTIES OF THE ISSUER AND THE COMPANY.
5
 
5.1
Organization; Power and Authority.
5
 
5.2
Authorization, etc.
5
 
5.3
Disclosure.
6
 
5.4
Organization and Ownership of Shares of Subsidiaries.
6
 
5.5
Financial Statements; Material Liabilities.
6
 
5.6
Compliance with Laws, Other Instruments, etc.
6
 
5.7
Governmental Authorizations, etc.
7
 
5.8
Litigation; Observance of Statutes and Orders.
7
 
5.9
Taxes.
8
 
5.10
Title to Property; Leases.
8
 
5.11
Licenses, Permits, etc.
8
 
5.12
Compliance with ERISA.
9
 
5.13
Private Offering by the Company.
10
 
5.14
Use of Proceeds; Margin Regulations.
10
 
5.15
Existing Indebtedness; Future Liens.
10
 
5.16
Foreign Assets Control Regulations, etc.
11
 
5.17
Status under Certain Statutes.
12
 
5.18
Environmental Matters.
12
       
6.
REPRESENTATIONS OF THE PURCHASERS.
12
 
6.1
Purchase for Investment.
12
 
6.2
Additional Representations of the Purchasers.
13

 
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6.3
Resale Restrictions.
13
 
6.4
Legend.
13
 
6.5
Source of Funds.
14
 
6.6
Authority.
15
 
 
 
 
7.
INFORMATION AS TO THE COMPANY.
15
 
7.1
Financial and Business Information.
15
 
7.2
Officer’s Certificate.
19
 
7.3
Visitation.
19
 
 
 
 
8.
PREPAYMENT OF THE NOTES.
20
 
8.1
No Scheduled Prepayments.
20
 
8.2
Optional Prepayments with Make-Whole Amount.
20
 
8.3
Mandatory Offer to Prepay Upon Change of Control.
21
 
8.4
Allocation of Partial Prepayments.
21
 
8.5
Maturity; Surrender, etc.
22
 
8.6
Purchase of Notes.
22
 
8.7
Make-Whole Amount.
22
 
 
 
 
9.
AFFIRMATIVE COVENANTS.
24
 
9.1
Compliance with Law.
24
 
9.2
Insurance.
24
 
9.3
Maintenance of Properties.
24
 
9.4
Payment of Taxes and Claims.
25
 
9.5
Corporate Existence, etc.
25
 
9.6
Books and Records.
25
 
9.7
Subsidiary Guarantor.
25
 
 
 
 
10.
NEGATIVE COVENANTS.
27
 
10.1
Debt to Capitalization Ratio.
27
 
10.2
Liens.
27
 
10.3
Merger, Consolidation, etc.
29
 
10.4
Economic Sanctions, Etc.
31
 
10.5
[Reserved].
31
 
10.6
Subsidiary Indebtedness
31
 
10.7
Transactions with Affiliates
32
 
10.8
Line of Business
32
 
 
 
 
11.
EVENTS OF DEFAULT.
32
 
 
 
12.
REMEDIES ON DEFAULT, ETC.
34
 
12.1
Acceleration.
34
 
12.2
Other Remedies.
35
 
12.3
Rescission.
35
 
12.4
No Waivers or Election of Remedies, Expenses, etc.
36
 
 
 
 
13.
GUARANTY OF NOTES.
36

 
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13.1
Guarantee.
36
 
13.2
Obligations Not Waived.
36
 
13.3
[Reserved].
37
 
13.4
Guarantee of Payment.
37
 
13.5
No Discharge or Diminishment of Guarantee.
37
 
13.6
Defenses of the Issuer Waived.
37
 
13.7
Agreement to Pay; Subrogation.
38
 
13.8
Information.
38
 
13.9
Termination.
38
 
 
 
 
14.
REGISTRATION; EXCHANGE; SUBSTITUTION; TRANSFER OF NOTES.
38
 
14.1
Registration of Notes.
38
 
14.2
Transfer and Exchange of Notes.
39
 
14.3
Replacement of Notes.
39
 
 
 
 
15.
PAYMENTS ON NOTES.
40
 
15.1
Place of Payment.
40
 
15.2
Home Office Payment.
40
 
15.3
FATCA Information.
40
 
 
 
 
16.
EXPENSES, ETC.
41
 
16.1
Transaction Expenses.
41
 
16.2
Survival.
41
 
 
 
 
17.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE  AGREEMENT.
42
 
 
 
18.
AMENDMENT AND WAIVER.
42
 
18.1
Requirements.
42
 
18.2
Solicitation of Holders of Notes.
42
 
18.3
Binding Effect, etc.
43
 
18.4
Notes held by the Issuer, etc.
43
 
 
 
 
19.
NOTICES.
43
 
 
 
20.
REPRODUCTION OF DOCUMENTS.
44
 
 
 
21.
CONFIDENTIAL INFORMATION.
45
 
 
 
22.
SUBSTITUTION OF PURCHASER.
46
 
 
 
23.
MISCELLANEOUS.
46
 
23.1
Successors and Assigns.
46
 
23.2
Payments Due on Non-Business Days.
46
 
23.3
Accounting Terms.
47
 
23.4
Severability.
47
 
23.5
Construction.
47
 
23.6
Counterparts.
48
 
23.7
Governing Law.
48
 
23.8
Jurisdiction and Process; Waiver of Jury Trial.
48

 
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SCHEDULE A
--
Information Relating to Purchasers
SCHEDULE B
--
Defined Terms
     
SCHEDULE 5.3
--
Disclosure Materials
SCHEDULE 5.4
--
Subsidiaries; Ownership of Subsidiary Stock
SCHEDULE 5.5
--
Financial Statements
SCHEDULE 5.11
--
Licenses, Permits, etc.
SCHEDULE 5.15
--
Existing Indebtedness
     
EXHIBIT 1
--
Form of Note
EXHIBIT 4.4(a)
--
Form of Opinion of Special Counsel for the Company
EXHIBIT 4.4(b)
--
Form of Opinion of Internal Counsel for the Company
EXHIBIT 4.4(c)
--
Form of Opinion of Special Arizona Regulatory Counsel for the Company
     
EXHIBIT 4.4(d)
--
Form of Opinion of Special Regulatory Counsel for the Company
EXHIBIT 4.4(e)
--
Form of Opinion of Special Counsel to the Purchasers

 
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RIO GRANDE RESOURCES TRUST II
(El Paso Electric Company, guarantor)
Stanton Tower
100 N. Stanton
El Paso, TX 79901
Phone: (915) 543-5711
Fax: (915) 521-4729

4.07% Senior Guaranteed Notes, due August 15, 2025

Dated as of June 28, 2018

TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
 
Ladies and Gentlemen:
 
EL PASO ELECTRIC COMPANY, a Texas corporation (the “Company”), agrees with each
of the Purchasers, and will instruct The Bank of New York Mellon Trust Company,
N.A., not in its individual capacity, but solely in its capacity as trustee of
the Rio Grande Resources Trust II (as successor to JPMorgan Chase Bank, N.A., in
such capacity, the “Trustee”) to cause the RIO GRANDE RESOURCES TRUST II (the
“Issuer”) to agree with each of the Purchasers as follows:
 
Wherever this Agreement contemplates or requires action by the Issuer, the
Company agrees to instruct the Trustee, consistent with the Trust Agreement, to
cause the Issuer to perform such action.
 
1.
AUTHORIZATION OF NOTES.

 
The Issuer and the Company have authorized the issue and sale of $65,000,000
aggregate principal amount of the Issuer’s 4.07% Senior Guaranteed Notes, due
August 15, 2025 (the “Notes”, such term to include any such Notes issued in
substitution therefor pursuant to Section 14 of this Agreement). The Notes shall
be substantially in the form set out in Exhibit 1, with such changes therefrom,
if any, as may be approved by such Purchasers of such Notes, the Company, and
the Issuer. Certain capitalized terms used in this Agreement are defined in
Schedule B; references to a “Schedule” or an “Exhibit” are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.
 
2.
SALE AND PURCHASE OF NOTES.

 
Subject to the terms and conditions of this Agreement, the Issuer will issue and
sell to each Purchaser and each Purchaser will purchase from the Issuer, at the
Closing provided for in Section 3, Notes in the principal amount specified
opposite such Purchaser’s name in Schedule A at the purchase price of 100% of
the principal amount thereof. The Purchasers’ obligations hereunder are several
and not joint obligations and no Purchaser shall have any liability to any
Person for the performance or non-performance of any obligation by any other
Purchaser hereunder. Notwithstanding the foregoing, if any Purchaser defaults on
its purchase obligations hereunder and the other Purchasers do not collectively
purchase 100% of the Notes to be issued hereby, the Issuer and the Company shall
have the right to terminate this Agreement.
 

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3.
CLOSING.

 
The sale and purchase of the Notes to be purchased by each Purchaser shall occur
at the offices of Greenberg Traurig, LLP, 77 West Wacker Drive, Suite 3100,
Chicago, Illinois 60601, at 9:00 a.m., Chicago time, at a closing (the
“Closing”) on June 28, 2018 or on such other Business Day thereafter as may be
agreed upon by the Issuer and the Purchasers. At the Closing, the Issuer will
deliver to each Purchaser the Notes to be purchased by such Purchaser in the
form of a single Note (or such greater number of Notes in denominations of at
least $100,000 as such Purchaser may request) dated the date of the Closing and
registered in such Purchaser’s name (or in the name of its nominee), against
delivery by such Purchaser to the Issuer or its order of immediately available
funds in the amount of the purchase price therefor by wire transfer of
immediately available funds for the account of the Issuer to account number
4183958400 at The Bank of New York Mellon, ABA number 021000018. If at the
Closing the Issuer shall fail to tender such Notes to any Purchaser as provided
above in this Section 3, or any of the conditions specified in Section 4 shall
not have been fulfilled to such Purchaser’s satisfaction, such Purchaser shall,
at its election, be relieved of all further obligations under this Agreement,
without thereby waiving any rights such Purchaser may have by reason of such
failure or such nonfulfillment.
 
4.
CONDITIONS TO CLOSING.

 
Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such
Purchaser at the Closing is subject to the fulfillment to such Purchaser’s
satisfaction, prior to or at the Closing, of the following conditions:
 
4.1
Representations and Warranties.

 
The representations and warranties of the Issuer and the Company in this
Agreement shall be correct when made and at the time of the Closing.
 
4.2
Performance; No Default.

 
The Issuer and the Company shall have performed and complied with all agreements
and conditions contained in this Agreement required to be performed or complied
with by it prior to or at the Closing. Before and after giving effect to the
issue and sale of the Notes (and the application of the proceeds thereof as
contemplated by Section 5.14), no Default or Event of Default shall have
occurred and be continuing. The Company shall not have entered into any
transaction since the date of the Memorandum that would have been prohibited by
Section 10 had such Section applied since such date.
 
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4.3
Compliance Certificates.

 
(a)           Officer’s Certificate. The Company shall have delivered to such
Purchaser an Officer’s Certificate, dated the date of Closing, certifying that
the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.
 
(b)           Secretary’s Certificate. The Company shall have delivered to such
Purchaser a certificate of its Secretary or Assistant Secretary, dated the date
of Closing, certifying as to (i) the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
the Notes and this Agreement and (ii) the Company’s organizational documents as
then in effect.
 
(c)           Trustee’s Certificate. The Trustee shall have delivered to such
Purchaser a certificate of an Officer of the Trustee, dated the date of Closing,
certifying as to the proceedings relating to the authorization, execution and
delivery of the Notes and this Agreement.
 
4.4
Opinions of Counsel.

 
Such Purchaser shall have received opinions in form and substance satisfactory
to such Purchaser, dated the date of the Closing (a) from Baker Botts LLP,
counsel for the Company, covering the matters set forth in Exhibit 4.4(a) and
covering such other matters incident to the transactions contemplated hereby as
such Purchaser or its counsel may reasonably request (and the Company hereby
instructs its counsel to deliver such opinion to the Purchasers), (b) from
Adrian J. Rodriguez, Senior Vice President ― General Counsel of the Company,
covering the matters set forth in Exhibit 4.4(b) and covering such other matters
incident to the transactions contemplated hereby as such Purchaser or its
counsel may reasonably request (and the Company hereby instructs its counsel to
deliver such opinion to the Purchasers), (c) from Perkins Coie LLP, special
Arizona regulatory counsel for the Company, covering the matters set forth in
Exhibit 4.4(c) and covering such other matters incident to the transactions
contemplated hereby as such Purchaser or its counsel may reasonably request (and
the Company hereby instructs its counsel to deliver such opinion to the
Purchasers), and (d) from Perkins Coie LLP, special regulatory counsel for the
Company, covering the matters set forth in Exhibit 4.4(d) and covering such
other matters incident to the transactions contemplated hereby as such Purchaser
or its counsel may reasonably request (and the Company hereby instructs its
counsel to deliver such opinion to the Purchasers), and covering such other
matters incident to the transactions contemplated hereby as such Purchaser or
its counsel may reasonably request (and the Company hereby instructs its counsel
to deliver such opinion to the Purchasers) and (e) from Greenberg Traurig, LLP,
the Purchasers’ special counsel in connection with such transactions,
substantially in the form set forth in Exhibit 4.4(e) and covering such other
matters incident to such transactions as such Purchaser may reasonably request.
 
4.5
Purchase Permitted by Applicable Law, etc.

 
On the date of the Closing, such Purchaser’s purchase of Notes shall (i) be
permitted by the laws and regulations of each jurisdiction to which such
Purchaser is subject, without recourse to provisions (such as section 1405(a)(8)
of the New York Insurance Law) permitting limited investments by insurance
companies without restriction as to the character of the particular investment,
(ii) not violate any applicable law or regulation (including, without
limitation, Regulation T, U or X of the Board of Governors of the Federal
Reserve System) and (iii) not subject such Purchaser to any tax, penalty or
liability under or pursuant to any applicable law or regulation, which law or
regulation was not in effect on the date hereof. If requested by such Purchaser,
such Purchaser shall have received an Officer’s Certificate certifying as to
such matters of fact as such Purchaser may reasonably specify to enable such
Purchaser to determine whether such purchase is so permitted.
 
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4.6
Sale of Other Notes.

 
Contemporaneously with the Closing, the Issuer shall sell to each other
Purchaser and each other Purchaser shall purchase the Notes to be purchased by
it at the Closing as specified in Schedule A.
 
4.7
Payment of Special Counsel Fees.

 
Without limiting the provisions of Section 16.1, the Issuer shall have paid on
or before the Closing the reasonable fees, charges and disbursements of the
Purchasers’ special counsel referred to in Section 4.4 reflected in a statement
of such counsel rendered to the Issuer at least one Business Day prior to the
Closing.
 
4.8
Private Placement Numbers.

 
Private Placement Numbers issued by Standard & Poor’s CUSIP Service Bureau (in
cooperation with the SVO) shall have been obtained by Greenberg Traurig, LLP,
for the Notes.
 
4.9
Changes in Organization Structure.

 
Neither the Issuer nor the Company shall have changed its jurisdiction of
incorporation or organization, as applicable, or been a party to any merger or
consolidation and shall not have succeeded to all or any substantial part of the
liabilities of any other Person, at any time following the date of the most
recent financial statements referred to in Schedule 5.5.
 
4.10
Funding Instructions.

 
At least three Business Days prior to the date of the Closing, each Purchaser
shall have received written instructions signed by the Issuer on letterhead of
the Issuer confirming the information specified in Section 3 including (i) the
name and address of the transferee bank, (ii) such transferee bank’s ABA number
and (iii) the account name and number into which the purchase price for the
Notes is to be deposited.
 
4.11
Proceedings and Documents.

 
All corporate, trust and other proceedings in connection with the transactions
contemplated by this Agreement and all documents and instruments incident to
such transactions shall be reasonably satisfactory to such Purchaser and its
special counsel, and such Purchaser and its special counsel shall have received
all such counterpart originals or certified or other copies of such documents as
such Purchaser or such special counsel may reasonably request.
 
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5.
REPRESENTATIONS AND WARRANTIES OF THE ISSUER AND THE COMPANY.

 
Each of the Company and the Issuer represents and warrants to each Purchaser
that:
 
5.1
Organization; Power and Authority.

 
The Company is a corporation duly organized, validly existing and in good
standing under the laws of Texas, and is duly qualified as a foreign corporation
and is in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The Company has the
corporate power and authority to own or hold under lease the properties it
purports to own or hold under lease, to transact the business it transacts and
proposes to transact, to execute and deliver this Agreement and to perform the
provisions hereof and under the Trust Agreement and the Purchase Contract.
 
The Issuer is a trust duly formed, validly existing and in good standing under
the laws of Texas. The Issuer has all requisite power and authority to own or
hold under lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to execute and
deliver this Agreement and the Notes and to perform the provisions hereof and
thereof and under the Trust Agreement and the Purchase Contract.
 
5.2
Authorization, etc.

 
This Agreement, the Trust Agreement and the Purchase Contract have been duly
authorized by all necessary corporate action on the part of the Company, and
this Agreement, the Trust Agreement and the Purchase Contract constitute legal,
valid and binding obligations of the Company enforceable against the Company in
accordance with their terms, except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
 
This Agreement, the Trust Agreement, the Purchase Contract and the Notes have
been duly authorized by all necessary trust action on the part of the Issuer and
the Trustee, and this Agreement, the Trust Agreement and the Purchase Contract
constitute, and upon execution and delivery thereof each Note will constitute, a
legal, valid and binding obligation of the Issuer enforceable against the Issuer
in accordance with its terms, except as such enforceability may be limited by
(i) applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors’ rights generally and (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
 
5

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5.3
Disclosure.

 
The Issuer and the Company, through their agents, U.S. Bancorp Investments, Inc.
and MUFG Securities Americas Inc., have delivered to each Purchaser a copy of a
Private Placement Memorandum, dated May 2018 (including the documents
incorporated by reference therein, the “Memorandum”), relating to the
transactions contemplated hereby. The Memorandum fairly describes, in all
material respects, the general nature of the business and principal properties
of the Company. This Agreement, the Memorandum, the documents, certificates or
other writings delivered or made available to the Purchasers by or on behalf of
the Company prior to June 11, 2018 in connection with the transactions
contemplated hereby and identified in Schedule 5.3 and the financial statements
listed in Schedule 5.5, (this Agreement, the Memorandum and such documents,
certificates or other writings and such financial statements delivered to each
Purchaser being referred to, collectively, as the “Disclosure Documents”), taken
as a whole, do not contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein not misleading
in light of the circumstances under which they were made. Since March 31, 2018,
there has been no change in the financial condition, operations, business,
properties or prospects of the Issuer or the Company except changes that
individually or in the aggregate could not reasonably be expected to have a
Material Adverse Effect. There is no fact known to the Issuer or the Company
that could reasonably be expected to have a Material Adverse Effect that has not
been set forth herein or in the Disclosure Documents.
 
5.4
Organization and Ownership of Shares of Subsidiaries.

 
(a)           The Company has no Subsidiaries.
 
(b)           Schedule 5.4 contains (except as noted therein) complete and
correct lists of (i) the Company’s Affiliates and (ii) the Company’s directors
and senior officers.
 
5.5
Financial Statements; Material Liabilities.

 
The Company has delivered to each Purchaser copies of the consolidated financial
statements of the Company listed on Schedule 5.5. All of such financial
statements (including in each case the related schedules and notes) fairly
present in all material respects the consolidated financial position of the
Company as of the respective dates specified in such Schedule and the
consolidated results of their operations and cash flows for the respective
periods so specified and have been prepared in accordance with GAAP consistently
applied throughout the periods involved except as set forth in the notes thereto
(subject, in the case of any interim financial statements, to normal year-end
adjustments). The Company does not have any Material liabilities that are not
disclosed on such financial statements or otherwise disclosed in the Disclosure
Documents.
 
5.6
Compliance with Laws, Other Instruments, etc.

 
The execution, delivery and performance by the Company of this Agreement, the
Trust Agreement and the Purchase Contract will not (i) contravene, result in any
breach of, or constitute a default under, or result in the creation of any Lien
in respect of any property of the Company under, any indenture, mortgage, deed
of trust, loan, purchase or credit agreement, lease, corporate charter,
regulations or by-laws, shareholders agreement or any other agreement or
instrument to which the Company is bound or to which any of the properties of
the Company is subject, (ii) conflict with or result in a breach of any of the
terms, conditions or provisions of any order, judgment, decree, or ruling of any
court, arbitrator or Governmental Authority applicable to the Company or (iii)
violate any provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Company, except for any default or
violation that would not have a Material Adverse Effect.
 
6

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The execution, delivery and performance by the Issuer of this Agreement, the
Trust Agreement, the Purchase Contract and the Notes will not (i) contravene,
result in any breach of, or constitute a default under, or result in the
creation of any Lien in respect of any property of the Issuer under, any
indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease,
corporate charter or by-laws, or any other agreement or instrument to which the
Issuer is bound or to which any of its property is subject, (ii) conflict with
or result in a breach of any of the terms, conditions or provisions of any
order, judgment, decree, or ruling of any court, arbitrator or Governmental
Authority applicable to the Issuer or (iii) violate any provision of any statute
or other rule or regulation of any Governmental Authority applicable to the
Issuer, except for any default or violation that would not have a Material
Adverse Effect.
 
5.7
Governmental Authorizations, etc.

 
Other than the approvals of FERC and the New Mexico Public Regulation Commission
(the “NMPRC”), which approvals have been received and are in full force and
effect, no consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement, or in
connection with the execution, delivery or performance by the Issuer of this
Agreement or the Notes.
 
5.8
Litigation; Observance of Statutes and Orders.

 
(a)          There are no actions, suits, proceedings or investigations pending
or, to the knowledge of the Company or the Issuer, threatened against or
affecting the Issuer or the Company or any property of the Issuer or the Company
in any court or before any arbitrator of any kind or before or by any
Governmental Authority that individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect.
 
(b)          Neither the Issuer nor the Company is (i) in default under any term
of any agreement or instrument to which it is a party or by which it is bound,
(ii) in violation of any order, judgment, decree or ruling of any court, any
arbitrator of any kind or any Governmental Authority or (iii) in violation of
any applicable law, ordinance, rule or regulation of any Governmental Authority
(including Environmental Laws, the USA Patriot Act or any of the other laws or
regulations that are referred to in Section 5.16), which default or violation,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
 
7

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5.9
Taxes.

 
The Company has filed all tax returns that are required to have been filed in
any jurisdiction (except in any case in which the failure to so file would not
have a Material Adverse Effect), and have paid all taxes shown to be due and
payable on such returns and all other taxes and assessments levied upon them or
their properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent,
except for any taxes and assessments (i) the nonpayment of which would not,
individually or in the aggregate, have a Material Adverse Effect or (ii) the
amount, applicability or validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which the Company has
established adequate reserves in accordance with GAAP. The Company knows of no
basis for any other tax or assessment that could, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The
charges, accruals and reserves on the books of the Company in respect of U.S.
federal, state or other taxes for all fiscal periods are adequate. The U.S.
federal income tax liabilities of the Company have been finally determined
(whether by reason of completed audits or the statute of limitations having run)
for all fiscal years up to and including the fiscal year ended December 31,
2016.
 
5.10
Title to Property; Leases.

 
Subject to the Lien of the General Mortgage Indenture and Deed of Trust, dated
as of February 1, 1996 between the Company and State Street Bank and Trust
Company, as amended and supplemented to the date of the Closing, the Company has
good and sufficient title to their respective properties that individually or in
the aggregate are Material, including all such properties reflected in the most
recent audited balance sheet referred to in Section 5.5 or purported to have
been acquired by the Company after said date (except as sold or otherwise
disposed of in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement. All leases that individually or in the
aggregate are Material are valid and subsisting and are in full force and effect
in all material respects.
 
5.11
Licenses, Permits, etc.

 
(a)          Except as disclosed on Schedule 5.11, the Company owns or possesses
all licenses, permits, franchises, authorizations, patents, copyrights,
proprietary software, service marks, trademarks and trade names, or rights
thereto, that individually or in the aggregate are Material, without known
conflict with the rights of others.
 
(b)          To the knowledge of the Company, no product or service of the
Company infringes in any material respect any license, permit, franchise,
authorization, patent, copyright, proprietary software, service mark, trademark,
trade name or other right owned by any other Person.
 
(c)          To the knowledge of the Company, there is no Material violation by
any Person of any right of the Company with respect to any patent, copyright,
proprietary software, service mark, trademark, trade name or other right owned
or used by the Company.
 
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5.12
Compliance with ERISA.

 
(a)          The Company and each ERISA Affiliate have operated and administered
each Plan in compliance with all applicable laws except for such instances of
noncompliance as have not resulted in and could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in section 3 of ERISA), and no
event, transaction or condition has occurred or exists that could, individually
or in the aggregate, reasonably be expected to result in the incurrence of any
such liability by the Company or any ERISA Affiliate, or in the imposition of
any Lien on any of the rights, properties or assets of the Company or any ERISA
Affiliate, in either case pursuant to Title I or IV of ERISA or to section
430(k) of the Code or to any such penalty or excise tax provisions under the
Code or federal law or section 4068 of ERISA or by the granting of a security
interest in connection with the amendment of a Plan, other than such liabilities
or Liens as would not be individually or in the aggregate Material.
 
(b)          The present value of the aggregate benefit liabilities under each
of the Plans (other than Multiemployer Plans), determined as of the end of such
Plan’s most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan’s most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities by more than $58,000,000 in the case of
any single Plan and by more than $113,000,000 in the aggregate for all Plans.
The term “benefit liabilities” has the meaning specified in section 4001 of
ERISA and the terms “current value” and “present value” have the meaning
specified in section 3 of ERISA.
 
(c)          The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
 
(d)          The expected postretirement benefit obligation (determined as of
the last day of the Company’s most recently ended fiscal year in accordance with
Financial Accounting Standards Board Accounting Standards Codification Topic
715-60, without regard to liabilities attributable to continuation coverage
mandated by section 4980B of the Code) of the Company is set forth on the most
recent audited balance sheet of the Company included in the financial statements
listed in Schedule 5.5.
 
(e)          The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction that is subject to
the prohibitions of section 406 of ERISA or in connection with which a tax could
be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation
by the Company to each Purchaser in the first sentence of this Section 5.12(e)
is made in reliance upon and subject to the accuracy of such Purchaser’s
representation in Section 6.5 as to the sources of the funds to be used to pay
the purchase price of the Notes to be purchased by such Purchaser.
 
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5.13
Private Offering by the Company.

 
None of the Issuer, the Company or anyone acting on their behalf has offered the
Notes or any similar Securities that would be integrated with the Notes for sale
to, or solicited any offer to buy any of the same from, or otherwise approached
or negotiated in respect thereof with, any person other than the Purchasers and
not more than 40 other Institutional Accredited Investors, each of which has
been offered the Notes at a private sale for investment. None of the Issuer, the
Company or anyone acting on their behalf has taken, or will take, any action
that would subject the issuance or sale of the Notes to the registration
requirements of section 5 of the Securities Act or to the registration
requirements of any Securities or blue sky laws of any applicable jurisdiction.
 
5.14
Use of Proceeds; Margin Regulations.

 
The Issuer will apply the proceeds of the sale of the Notes to repay outstanding
short-term borrowings under the Credit Agreement by the Company for working
capital and general corporate purposes and by the Issuer to finance nuclear fuel
purchases. No part of the proceeds from the sale of the Notes hereunder will be
used, directly or indirectly, for the purpose of buying or carrying any margin
stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or
trading in any securities under such circumstances as to involve the Issuer or
the Company in a violation of Regulation X of said Board (12 CFR 224) or to
involve any broker or dealer in a violation of Regulation T of said Board (12
CFR 220). Margin stock does not constitute more than 25% of the value of the
consolidated assets of the Issuer and the Company and neither the Issuer nor the
Company has any present intention that margin stock will constitute more than
25% of the value of such assets. As used in this Section, the terms “margin
stock” and “purpose of buying or carrying” shall have the meanings assigned to
them in said Regulation U.
 
5.15
Existing Indebtedness; Future Liens.

 
(a)           Except as described therein, Schedule 5.15 sets forth a complete
and correct list of all outstanding Indebtedness of the Issuer and the Company
as of March 31, 2018 (including a description of the obligors and obligees,
principal amount outstanding and collateral therefor, if any, and guaranty
thereof, if any), since which date there has been no Material change in the
amounts, interest rates, sinking funds, installment payments or maturities of
the Indebtedness of the Issuer or the Company. Neither the Issuer nor the
Company is in default and no waiver of default is currently in effect, in the
payment of any principal or interest on any Indebtedness of the Issuer or the
Company and no event or condition exists with respect to any Indebtedness of the
Issuer or the Company that would permit (or that with notice or the lapse of
time, or both, would permit) one or more Persons to cause such Indebtedness to
become due and payable before its stated maturity or before its regularly
scheduled dates of payment.
 
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(b)          Except as disclosed in Schedule 5.15, neither the Issuer nor the
Company has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its property, whether now owned
or hereafter acquired, to be subject to a Lien (other than a Mortgage Indenture)
not permitted by Section 10.2.
 
(c)          Neither the Issuer nor the Company is a party to, or otherwise
subject to any provision contained in, any instrument evidencing Indebtedness of
the Company, any agreement relating thereto or any other agreement (including
its charter or any other organizational document) that limits the amount of, or
otherwise imposes restrictions on the incurring of, Indebtedness of the Issuer
or the Company, except as specifically indicated in Schedule 5.15.
 
5.16
Foreign Assets Control Regulations, etc.

 
(a)          Neither the Issuer, the Company, nor any Controlled Entity (i) is a
Blocked Person, (ii) has been notified that its name appears or may in the
future appear on a State Sanctions List or (iii) is a target of sanctions that
have been imposed by the United Nations or the European Union.
 
(b)          Neither the Issuer, the Company, nor any Controlled Entity (i) has
violated, been found in violation of, or been charged or convicted under, any
applicable U.S. Economic Sanctions Laws, Anti-Money Laundering Laws or
Anti-Corruption Laws or (ii) to the Company’s knowledge, is under investigation
by any Governmental Authority for possible violation of any U.S. Economic
Sanctions Laws, Anti-Money Laundering Laws or Anti-Corruption Laws.
 
(c)           No part of the proceeds from the sale of the Notes hereunder:
 
(i)          constitutes or will constitute funds obtained on behalf of any
Blocked Person or will otherwise be used by the Issuer, the Company or any
Controlled Entity, directly or indirectly, (A) in connection with any investment
in, or any transactions or dealings with, any Blocked Person, (B) for any
purpose that would cause any Purchaser to be in violation of any U.S. Economic
Sanctions Laws or (C) otherwise in violation of any U.S. Economic Sanctions
Laws;
 
(ii)          will be used, directly or indirectly, in violation of, or cause
any Purchaser to be in violation of, any applicable Anti-Money Laundering Laws;
or
 
(iii)          will be used, directly or indirectly, for the purpose of making
any improper payments, including bribes, to any Governmental Official or
commercial counterparty in order to obtain, retain or direct business or obtain
any improper advantage, in each case which would be in violation of, or cause
any Purchaser to be in violation of, any applicable Anti-Corruption Laws.
 
(d)          The Company has established procedures and controls that they
reasonably believe are adequate (and otherwise comply with applicable law) to
ensure that the Issuer, the Company and each Controlled Entity is and will
continue to be in compliance with all applicable U.S. Economic Sanctions Laws,
Anti-Money Laundering Laws and Anti-Corruption Laws.
 
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5.17
Status under Certain Statutes.

 
Neither of the Issuer or the Company is subject to regulation under the
Investment Company Act of 1940, as amended, or the ICC Termination Act, as
amended. The Company is subject to regulation by the FERC under the Federal
Power Act, as amended. The Company is a public utility company in the States of
Texas and New Mexico and is subject to regulation as a public utility company in
those States.
 
5.18
Environmental Matters.

 
Except as disclosed in the Disclosure Documents:
 
(a)          The Company has no knowledge of any claim or has received any
notice of any claim, and no proceeding has been instituted raising any claim
against the Company or any of its respective real properties or other assets now
or formerly owned, leased or operated by any of them or other assets, alleging
any damage to the environment or violation of any Environmental Laws, except, in
each case, such as could not reasonably be expected to result in a Material
Adverse Effect.
 
(b)          The Company has no knowledge of any facts that would give rise to
any claim, public or private, of violation of Environmental Laws or damage to
the environment emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by any of them or to other
assets or their use, except, in each case, such as could not, individually or in
the aggregate, reasonably be expected to result in a Material Adverse Effect.
 
(c)          The Company has not stored any Hazardous Materials on real
properties now or formerly owned, leased or operated by any of them and has not
disposed of any Hazardous Materials in a manner contrary to any Environmental
Laws in each case in any manner that could, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.
 
(d)          All buildings on all real properties now owned, leased or operated
by the Company are in compliance with applicable Environmental Laws, except
where failure to comply could not, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect.
 
6.
REPRESENTATIONS OF THE PURCHASERS.

 
6.1
Purchase for Investment.

 
Each Purchaser severally represents that it is an institutional “accredited
investor” (as such term is defined under Rule 501(a)(1), (2), (3) or (7)
promulgated under the Securities Act) and are purchasing the Notes for its own
account, for the account of another Institutional Accredited Investor, or for
one or more separate accounts maintained by such Purchaser or for the account of
one or more pension or trust funds and not with a view to the distribution
thereof, provided that the disposition of such Purchaser’s or their property
shall at all times be within such Purchaser’s or their control. Each Purchaser
understands that the Notes have not been registered under the Securities Act,
that the sale of the Notes is being made by the Issuer in reliance on a private
placement exemption from registration under the Securities Act, and that the
Notes may be resold only if registered pursuant to the provisions of the
Securities Act or if an exemption from registration is available, except under
circumstances where neither such registration nor such an exemption is required
by law, and that neither the Issuer nor the Company is required to register the
Notes under the Securities Act or to list the Notes on any national securities
exchange.
 
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6.2
Additional Representations of the Purchasers.

 
Each Purchaser further severally represents that such Purchaser (a) has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of its prospective investment in the Notes, (b)
has conducted its own investigation of the Issuer, the Company and the terms of
the Notes, (c) has access to the Company’s public filings with the SEC and to
such financial and other information as such Purchaser deems necessary to make
its decision to purchase the Notes, (d) has been offered the opportunity to ask
questions of the Issuer and the Company and received answers thereto, all as
such Purchaser deems necessary in connection with such Purchaser’s decision to
purchase the Notes and (e) has the ability to bear the economic risks of its
prospective investment and can afford the complete loss of such investment.
 
6.3
Resale Restrictions.

 
Each Purchaser understands and agrees on behalf of itself and on behalf of any
investor account for which such Purchaser is purchasing Notes, and each
subsequent holder of a Note by its acceptance thereof will be deemed to agree,
that the Notes will be transferable only in accordance with this Agreement and
that if such Purchaser or such holder decides to offer, resell, pledge or
otherwise transfer any of the Notes, such Notes may be offered, resold, pledged
or otherwise transferred only to an Institutional Accredited Investor in
reliance upon an exemption from registration under the Securities Act, and only
as permitted by Section 14.2.
 
6.4
Legend.

 
Each Purchaser understands that the Notes will, unless sold pursuant to a
registration statement that has been declared effective under the Securities
Act, bear a legend substantially to the following effect:
 
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
“SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY OTHER STATE OR OTHER
JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THIS SECURITY MAY ONLY BE
TRANSFERRED TO AN “INSTITUTIONAL ACCREDITED INVESTOR” IN ACCORDANCE WITH THE
TERMS OF THE NOTE PURCHASE AGREEMENT DATED AS OF JUNE 28, 2018.
 
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6.5
Source of Funds.

 
Each Purchaser severally represents that at least one of the following
statements is an accurate representation as to each source of funds (a “Source”)
to be used by such Purchaser to pay the purchase price of the Notes to be
purchased by such Purchaser hereunder:
 
(a)          the Source is an “insurance company general account” (as the term
is defined in the United States Department of Labor’s Prohibited Transaction
Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as
defined by the annual statement for life insurance companies approved by the
NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by
or on behalf of any employee benefit plan together with the amount of the
reserves and liabilities for the general account contract(s) held by or on
behalf of any other employee benefit plans maintained by the same employer (or
affiliate thereof as defined in PTE 95-60) or by the same employee organization
in the general account do not exceed 10% of the total reserves and liabilities
of the general account (exclusive of separate account liabilities) plus surplus
as set forth in the NAIC Annual Statement filed with such Purchaser’s state of
domicile; or
 
(b)          the Source is a separate account that is maintained solely in
connection with such Purchaser’s fixed contractual obligations under which the
amounts payable, or credited, to any employee benefit plan (or its related
trust) that has any interest in such separate account (or to any participant or
beneficiary of such plan (including any annuitant)) are not affected in any
manner by the investment performance of the separate account; or
 
(c)          the Source is either (i) an insurance company pooled separate
account, within the meaning of PTE 90-1 (issued January 29, 1990), or (ii) a
bank collective investment fund, within the meaning of the PTE 91-38 (issued
July 12, 1991) and, except as disclosed by such Purchaser to the Trustee in
writing pursuant to this paragraph (c), no employee benefit plan or group of
plans maintained by the same employer or employee organization beneficially owns
more than 10% of all assets allocated to such pooled separate account or
collective investment fund; or
 
(d)          the Source constitutes assets of an “investment fund” (within the
meaning of Part VI of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified
professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM
Exemption), no employee benefit plan’s assets that are managed by the QPAM in
such investment fund, when combined with the assets of all other employee
benefit plans established or maintained by the same employer or by an affiliate
(within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or
by the same employee organization and managed by such QPAM, represent more than
20% of the total client assets managed by such QPAM, the conditions of Part I(c)
and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person
controlling or controlled by the QPAM maintains an ownership interest in the
Company that would cause the QPAM and the Company to be “related” within the
meaning of Part VI(h) of the QPAM Exemption and (i) the identity of such QPAM
and (ii) the names of any employee benefit plans whose assets in the investment
fund, when combined with the assets of all other employee benefit plans
established or maintained by the same employer or by an affiliate (within the
meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same
employee organization, represent 10% or more of the assets of such investment
fund, have been disclosed to the Trustee in writing pursuant to this clause (d);
or
 
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(e)          the Source constitutes assets of a “plan(s)” (within the meaning of
Part IV(h) of PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset
manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption),
the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied,
neither the INHAM nor a person controlling or controlled by the INHAM (applying
the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10%
or more interest in the Company and (i) the identity of such INHAM and (ii) the
name(s) of the employee benefit plan(s) whose assets constitute the Source have
been disclosed to the Company in writing pursuant to this clause (e); or
 
(f)           the Source is a governmental plan; or
 
(g)          the Source is one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans, each of
which has been identified to the Trustee in writing pursuant to this paragraph
(g); or
 
(h)          the Source does not include assets of any employee benefit plan,
other than a plan exempt from the coverage of ERISA.
 
As used in this Section 6.2, the terms “employee benefit plan,” “governmental
plan,” and “separate account” shall have the respective meanings assigned to
such terms in section 3 of ERISA.
 
6.6
Authority.

 
If such Purchaser is acquiring Notes as a fiduciary or agent for one or more
investor accounts, such Purchaser severally represents that it has sole
investment discretion with respect to each such account and has full power to
make the foregoing representations and agreements on behalf of such account.
 
7.
INFORMATION AS TO THE COMPANY.

 
7.1
Financial and Business Information.

 
The Company will deliver to each holder of Notes that is an Institutional
Accredited Investor:
 
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(a)          Quarterly Statements -- within 60 days (or such shorter period as
is the earlier of (x) 15 days greater than the period applicable to the filing
of the Company’s Quarterly Report on Form 10-Q (the “Form 10-Q”) with the SEC
regardless of whether the Company is subject to the filing requirements thereof
and (y) the date by which such financial statements are required to be delivered
under any Material Credit Facility or the date on which such corresponding
financial statements are delivered under any Material Credit Facility if such
delivery occurs earlier than such required delivery date) after the end of each
quarterly fiscal period in each fiscal year of the Company (other than the last
quarterly fiscal period of each such fiscal year), duplicate copies of,
 
(i)          a consolidated balance sheet of the Company and its Subsidiaries as
at the end of such quarter,
 
(ii)         a consolidated statement of operations of the Company and its
Subsidiaries for such quarter and (in the case of the second and third quarters)
for the portion of the fiscal year ending with such quarter, and
 
(iii)        a consolidated statement of cash flows of the Company and its
Subsidiaries for the portion of the fiscal year ending with such quarter,
 
setting forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally, and
certified by a Senior Financial Officer as fairly presenting, in all material
respects, the financial position of the companies being reported on and their
results of operations and cash flows, subject to changes resulting from year-end
adjustments, provided that delivery of copies of the Company’s Form 10-Q
prepared in compliance with the requirements therefor and filed with the SEC
shall be deemed to satisfy the requirements of this Section 7.1(a) provided,
further, that the Company shall be deemed to have made such delivery of such
financial statements or such Form 10-Q if it shall have timely made Electronic
Delivery thereof;
 
(b)          Annual Statements -- within 120 days (or such shorter period as is
the earlier of (x) 15 days greater than the period applicable to the filing of
the Company’s Annual Report on Form 10-K (the “Form 10-K”) with the SEC
regardless of whether the Company is subject to the filing requirements thereof
and (y) the date by which such financial statements are required to be delivered
under any Material Credit Facility or the date on which such corresponding
financial statements are delivered under any Material Credit Facility if such
delivery occurs earlier than such required delivery date) after the end of each
fiscal year of the Company, duplicate copies of,
 
(i)          a consolidated balance sheet of the Company and its Subsidiaries,
as at the end of such year, and
 
(ii)          consolidated statements of operations, stockholders’ equity and
cash flows of the Company and its Subsidiaries for such year,
 
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setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied by an opinion thereon (without a “going concern” or similar
qualification or exception and without any qualification or exception as to the
scope of the audit on which such opinion is based) of independent public
accountants of recognized national standing, which opinion shall state that such
financial statements present fairly, in all material respects, the financial
position of the companies being reported upon and their results of operations
and cash flows and have been prepared in conformity with GAAP, and that the
examination of such accountants in connection with such financial statements has
been made in accordance with generally accepted auditing standards, and that
such audit provides a reasonable basis for such opinion in the circumstances,
provided that the delivery of the Company’s Annual Report on Form 10-K for such
fiscal year (together with the Company’s annual report to stockholders, if any,
prepared pursuant to Rule 14a-3 under the Exchange Act) prepared in accordance
with the requirements therefor and filed with the SEC shall be deemed to satisfy
the requirements of this Section 7.1(b) provided, further, that the Company
shall be deemed to have made such delivery of such financial statements or such
Form 10-K if it shall have timely made Electronic Delivery thereof;
 
(c)          SEC and Other Reports -- promptly upon their becoming available,
one copy of (i) each financial statement, report, notice or proxy statement sent
by the Company or its Subsidiaries to its public securities holders generally
and (ii) each regular or periodic report, each registration statement (without
exhibits except as expressly requested by such holder), and each prospectus and
all amendments thereto filed by the Company or its Subsidiaries with the SEC and
of all press releases and other statements made available generally by the
Company or its Subsidiaries to the public concerning developments that are
Material; provided that Electronic Delivery of such documents shall be deemed to
satisfy the requirements of this Section 7.1(c);
 
(d)          Notice of Default or Event of Default -- promptly, and in any event
within five days after the Issuer or a Responsible Officer becoming aware of the
existence of any Default or Event of Default or that any Person has given any
notice or taken any action with respect to a claimed default hereunder or that
any Person has given any notice or taken any action with respect to a claimed
default of the type referred to in Section 11(f), a written notice specifying
the nature and period of existence thereof and what action the Issuer and the
Company is taking or proposes to take with respect thereto;
 
(e)           ERISA Matters – promptly, and in any event within five days after
a Responsible Officer becoming aware of any of the following, a written notice
setting forth the nature thereof and the action, if any, that the Company or an
ERISA Affiliate proposes to take with respect thereto:
 
(i)          with respect to any Plan, any reportable event, as defined in
section 4043(c) of ERISA and the regulations thereunder, for which notice
thereof has not been waived pursuant to such regulations as in effect on the
date hereof, other than a reportable event that, alone or together with other
reportable events, would not reasonably be expected to have a Material Adverse
Effect; or
 
(ii)         the taking by the PBGC of steps to institute, or the threatening by
the PBGC of the institution of, proceedings under section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer
Plan that such action has been taken by the PBGC with respect to such
Multiemployer Plan; or
 
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(iii)        any event, transaction or condition that could result in the
incurrence of any liability by the Company or any ERISA Affiliate for a
violation of Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any ERISA Affiliate
pursuant to Title I or IV of ERISA or such penalty or excise tax provisions, if
such liability or Lien, taken together with any other such liabilities or Liens
then existing, could reasonably be expected to have a Material Adverse Effect;
 
(f)           Notices from Governmental Authority -- promptly, and in any event
within 30 days of receipt thereof, copies of any notice to the Issuer, the
Company or its Subsidiaries from any Federal or state Governmental Authority
relating to any order, ruling, statute or other law or regulation that could
reasonably be expected to have a Material Adverse Effect;
 
(g)          Trust Reports – promptly, and in any event within 5 days of receipt
thereof, copies of any periodic trust report of the Issuer delivered to the
Company;
 
(h)          Resignation or Replacement of Auditors – within 10 days following
the date on which the Company’s auditors resign or the Company elects to change
auditors, as the case may be, notification thereof, together with such further
information as the Required Holders may reasonably request;
 
(i)           Notice of Default Under Material Credit Facilities – promptly, and
in any event within 5 days of receipt thereof, copies of any notice of default
sent by the Company or its Subsidiaries to or received by the Company or its
Subsidiaries from its creditors under any Material Credit Facility; and
 
(j)           Requested Information -- with reasonable promptness, such other
data and information relating to the business, operations, affairs, financial
condition, assets or properties of the Issuer, the Company or its Subsidiaries
(including actual copies of any documents previously delivered by means of
Electronic Delivery) or relating to (i) the ability of the Issuer to perform its
obligations hereunder and under the Notes as from time to time may be reasonably
requested by any such holder of Notes or (ii) the ability of the Company to
perform its obligations hereunder as from time to time may be reasonably
requested by any such holder of Notes.
 
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7.2
Officer’s Certificate.

 
Each set of financial statements delivered to a holder of a Note pursuant to
Section 7.1(a) or Section 7.1(b) will be accompanied by a certificate (which, in
the case of Electronic Delivery of any such financial statements, may be by
separate concurrent delivery of such certificate to each holder of Notes or by
Electronic Delivery thereof) of a Senior Financial Officer:
 
(a)          Covenant Compliance — setting forth the information (including
detailed calculations and a reconciliation to GAAP if based other than on GAAP)
required in order to establish whether the Company was in compliance with the
requirements of Section 10 during the quarterly or annual period covered by the
statements then being furnished (including with respect to each such Section,
where applicable, the calculations of the maximum or minimum amount, ratio or
percentage, as the case may be, permissible under the terms of such Sections,
and the calculation of the amount, ratio or percentage then in existence). In
the event that the Company or any Subsidiary has made an election to measure any
financial liability using fair value (which election is being disregarded for
purposes of determining compliance with this Agreement pursuant to Section 23.3)
as to the period covered by any such financial statement, such Senior Financial
Officer’s certificate as to such period shall include a reconciliation from GAAP
with respect to such election;
 
(b)          Event of Default — certifying that such Senior Financial Officer
has reviewed the relevant terms hereof and has made, or caused to be made, under
his or her supervision, a review of the transactions and conditions of the
Company and its Subsidiaries from the beginning of the quarterly or annual
period covered by the statements then being furnished to the date of the
certificate and that such review shall not have disclosed the existence during
such period of any condition or event that constitutes a Default or an Event of
Default or, if any such condition or event existed or exists (including any such
event or condition resulting from the failure of the Company or its Subsidiaries
to comply with any Environmental Law), specifying the nature and period of
existence thereof and what action the Company shall have taken or proposes to
take with respect thereto; and
 
(c)          Subsidiary Guarantors – if then applicable, setting forth a list of
all Subsidiaries that are Subsidiary Guarantors and certifying that each
Subsidiary that is required to be a Subsidiary Guarantor pursuant to Section 9.7
is a Subsidiary Guarantor, in each case, as of the date of such certificate of
Senior Financial Officer.
 
7.3
Visitation.

 
The Company shall permit the representatives of each holder of Notes that is an
Institutional Accredited Investor:
 
(a)          No Default -- if no Default or Event of Default then exists, at the
expense of such holder and upon reasonable prior notice to the Company, but no
more than two times during any 12 month period, to visit, during normal business
hours, the principal executive office of the Company, to discuss the affairs,
finances and accounts of the Company and its Subsidiaries with the Company’s
officers, and (with the consent of the Company, which consent will not be
unreasonably withheld) its independent public accountants, and (with the consent
of the Company, which consent will not be unreasonably withheld) to visit the
other offices and properties of the Company and the Subsidiaries; and
 
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(b)          Default -- if a Default or Event of Default then exists, at the
expense of the Company, and upon reasonable prior notice to the Company, to
visit and inspect, during normal business hours, any of the offices or
properties of the Company or its Subsidiaries, to examine all their respective
books of account, records, reports and other papers, to make copies and extracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants (and by this
provision the Company authorizes said accountants to discuss the affairs,
finances and accounts of the Company and its Subsidiaries), all as often as may
be requested.
 
8.
PREPAYMENT OF THE NOTES.

 
8.1
No Scheduled Prepayments.

 
No regularly scheduled prepayments are due on the Notes prior to their stated
maturity.
 
8.2
Optional Prepayments with Make-Whole Amount.

 
The Issuer may, at its option, upon notice as provided below, prepay at any time
all, or from time to time any part of, the Notes in an amount not less than
$2,000,000 in the aggregate in the case of a partial prepayment, at 100% of the
principal amount so prepaid, plus the Make-Whole Amount determined for the
prepayment date with respect to such principal amount (provided that no
Make-Whole Amount shall be due if the Notes are prepaid in full during the 90
day period immediately preceding and ending on the scheduled maturity date of
the Notes). The Issuer will give each holder of Notes to be prepaid written
notice of each optional prepayment under this Section 8.2 not less than 30 days
and not more than 60 days prior to the date fixed for such prepayment. Each such
notice shall specify such date (which shall be a Business Day), the aggregate
principal amount of the Notes to be prepaid on such date, the principal amount
of each Note held by such holder to be prepaid (determined in accordance with
Section 8.4), and the interest to be paid on the prepayment date with respect to
such principal amount being prepaid, and shall be accompanied by a certificate
of a Senior Financial Officer of the Company as to the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if the date of such
notice were the date of the prepayment), setting forth the details of such
computation. Two Business Days prior to such prepayment, the Company shall
deliver to each holder of Notes to be prepaid a certificate of a Senior
Financial Officer of the Company specifying the calculation of such Make-Whole
Amount as of the specified prepayment date.
 
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8.3
Mandatory Offer to Prepay Upon Change of Control.

 
(a)          Change of Control. The Company will, within 5 days of a Rating
Decline, cause the Trustee to give each holder of Notes written notice
containing and constituting an offer to prepay Notes accompanied by the
certificate described in paragraph (e) of this Section 8.3.
 
(b)          Offer to Prepay Notes. The offer to prepay Notes contemplated by
paragraph (a) of this Section 8.3 shall be an offer to prepay, in accordance
with and subject to this Section 8.3, all, but not less than all, of the Notes
held by each holder (in this case only, “holder” in respect of any Note
registered in the name of a nominee for a disclosed beneficial owner shall mean
such beneficial owner) on the Business Day specified in such offer (the
“Proposed Prepayment Date”). The Proposed Prepayment Date shall be not less than
30 days and not more than 60 days after the date of such offer.
 
(c)          Acceptance; Rejection. A holder of Notes may accept the offer to
prepay made pursuant to this Section 8.3 by causing a notice of such acceptance
to be delivered to the Trustee on or before the date specified in the
certificate described in paragraph (e) of this Section 8.3. A failure by a
holder of Notes to respond to an offer to prepay made pursuant to this Section
8.3, or to accept an offer as to all of the Notes held by the holder, within
such time period shall be deemed to constitute rejection of such offer by such
holder.
 
(d)          Prepayment. Prepayment of the Notes to be prepaid pursuant to this
Section 8.3 shall be at 100% of the principal amount of such Notes, together
with interest on such Notes accrued to the date of prepayment and shall not
require the payment of any Make-Whole Amount. The prepayment shall be made on
the Proposed Prepayment Date.
 
(e)          Officer’s Certificate. Each offer to prepay the Notes pursuant to
this Section 8.3 shall be accompanied by a certificate, executed by the Trustee
and dated the date of such offer, specifying: (i) the Proposed Prepayment Date,
(ii) that such offer is made pursuant to this Section 8.3, (iii) the principal
amount of each Note offered to be prepaid, (iv) the interest that would be due
on each Note offered to be prepaid, accrued to the Proposed Prepayment Date, (v)
that the conditions of this Section 8.3 have been fulfilled, (vi) in reasonable
detail, the nature and date of the Change of Control and (vii) the date by which
any holder of a Note that wishes to accept such offer must deliver notice
thereof to the Trustee, which date shall not be earlier than three Business Days
prior to the Proposed Prepayment Date.
 
8.4
Allocation of Partial Prepayments.

 
In the case of each partial prepayment of Notes pursuant to Section 8.2, the
principal amount of the Notes to be prepaid shall be allocated among all of the
Notes at the time outstanding in proportion, as nearly as practicable, to the
respective unpaid principal amounts thereof not theretofore called for
prepayment.
 
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8.5
Maturity; Surrender, etc.

 
In the case of each prepayment of Notes pursuant to this Section 8, the
principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment (which shall be a Business Day),
together with interest on such principal amount accrued to such date and the
applicable Make-Whole Amount, if any. From and after such date, unless the
Issuer shall fail to pay such principal amount when so due and payable, together
with the interest and Make-Whole Amount, if any, as aforesaid, interest on such
principal amount shall cease to accrue. Any Note paid or prepaid in full shall
be surrendered to the Issuer and canceled and shall not be reissued, and no Note
shall be issued in lieu of any prepaid principal amount of any Note.
 
8.6
Purchase of Notes.

 
The Company will not and will not permit any Affiliate to purchase, redeem,
prepay or otherwise acquire, directly or indirectly, any of the outstanding
Notes except (a) upon the payment or prepayment of the Notes in accordance with
the terms of this Agreement and the Notes or (b) pursuant to an offer to
purchase made by the Company or an Affiliate pro rata to the holders of all
Notes at the time outstanding upon the same terms and conditions (which shall be
established by the Company). Any such offer shall provide each holder with
sufficient information to enable it to make an informed decision with respect to
such offer, and shall remain open for at least 10 Business Days. If the holders
of more than 50% of the principal amount of Notes then outstanding accept such
offer, the Company shall promptly notify the remaining holders of such fact and
the expiration date for the acceptance by holders of Notes of such offer shall
be extended by the number of days necessary to give each such remaining holder
at least 10 Business Days from its receipt of such notice to accept such offer.
The Trustee will promptly cancel all Notes acquired by the Company or any
Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to
any provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.
 
8.7
Make-Whole Amount.

 
“Make-Whole Amount” means, with respect to any Note, an amount equal to the
excess, if any, of the Discounted Value of the Remaining Scheduled Payments with
respect to the Called Principal of such Note over the amount of such Called
Principal, provided that the Make-Whole Amount may in no event be less than
zero. For the purposes of determining the Make-Whole Amount, the following terms
have the following meanings:
 
“Called Principal” means, with respect to any Note, the principal of such Note
that is to be prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the context requires.
 
“Discounted Value” means, with respect to the Called Principal of any Note, the
amount obtained by discounting all Remaining Scheduled Payments with respect to
such Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
 
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“Reinvestment Yield” means, with respect to the Called Principal of any Note,
the sum of (a) 0.50% plus (b) the yield to maturity implied by the “Ask
Yield(s)” reported as of 10:00 a.m. (New York City time) on the second Business
Day preceding the Settlement Date with respect to such Called Principal, on the
display designated as “Page PX1” (or such other display as may replace Page PX1)
on Bloomberg Financial Markets for the most recently issued actively traded
on-the-run U.S. Treasury securities (“Reported”) having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date. If
there are no such U.S. Treasury securities Reported having a maturity equal to
such Remaining Average Life, then such implied yield to maturity will be
determined by (i) converting U.S. Treasury bill quotations to bond equivalent
yields in accordance with accepted financial practice and (ii) interpolating
linearly between the “Ask Yields” Reported for the applicable most recently
issued actively traded on-the-run U.S. Treasury securities with the maturities
(1) closest to and greater than such Remaining Average Life and (2) closest to
and less than such Remaining Average Life. The Reinvestment Yield shall be
rounded to the number of decimal places as appears in the interest rate of the
applicable Note.
 
If such yields are not Reported or the yields Reported as of such time are not
ascertainable (including by way of interpolation), then “Reinvestment Yield”
means, with respect to the Called Principal of any Note, the sum of (x) 0.50%
plus (y) the yield to maturity implied by the U.S. Treasury constant maturity
yields reported, for the latest day for which such yields have been so reported
as of the second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable
successor publication) for the U.S. Treasury constant maturity having a term
equal to the Remaining Average Life of such Called Principal as of such
Settlement Date. If there is no such U.S. Treasury constant maturity having a
term equal to such Remaining Average Life, such implied yield to maturity will
be determined by interpolating linearly between (1) the U.S. Treasury constant
maturity so reported with the term closest to and greater than such Remaining
Average Life and (2) the U.S. Treasury constant maturity so reported with the
term closest to and less than such Remaining Average Life. The Reinvestment
Yield shall be rounded to the number of decimal places as appears in the
interest rate of the applicable Note.
 
“Remaining Average Life” means, with respect to any Called Principal, the number
of years obtained by dividing (i) such Called Principal into (ii) the sum of the
products obtained by multiplying (a) the principal component of each Remaining
Scheduled Payment with respect to such Called Principal by (b) the number of
years, computed on the basis of a 360-day year comprised of twelve 30-day months
and calculated to two decimal places, that will elapse between the Settlement
Date with respect to such Called Principal and the scheduled due date of such
Remaining Scheduled Payment.
 
“Remaining Scheduled Payments” means, with respect to the Called Principal of
any Note, all payments of such Called Principal and interest thereon that would
be due 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,
provided that if such Settlement Date is not a date on which interest payments
are due to be made under the terms of the Notes, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of interest
accrued to such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1.
 
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“Settlement Date” means, with respect to the Called Principal of any Note, the
date on which such Called Principal is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to Section
12.1, as the context requires.
 
9.
AFFIRMATIVE COVENANTS.

 
Each of the Company and the Issuer covenants that so long as any of the Notes
are outstanding:
 
9.1
Compliance with Law.

 
Without limiting Section 10.4, the Company will, will cause its Subsidiaries to,
and the Issuer will, comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject (including ERISA, the USA Patriot
Act and the other laws and regulations that are referred to in Section 5.16 and
Environmental Laws) and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
 
9.2
Insurance.

 
The Company will, will cause its Material Subsidiaries to, and the Issuer will,
maintain, with financially sound and reputable insurers, insurance with respect
to their respective properties and businesses and the insurable properties of
the Issuer against such casualties and contingencies, of such types, on such
terms and in such amounts (including deductibles, co-insurance and
self-insurance, if adequate reserves are maintained with respect thereto) as is
customary in the case of entities of established reputations engaged in the same
or a similar business and similarly situated.
 
9.3
Maintenance of Properties.

 
The Company will, will cause its Material Subsidiaries to, and the Issuer will,
maintain and keep, or cause to be maintained and kept, their respective
properties in good repair, working order and condition (other than ordinary wear
and tear), so that the business carried on in connection therewith may be
properly conducted at all times, provided that this Section shall not prevent
the Issuer, the Company or its Subsidiaries from discontinuing the operation and
the maintenance of any of its properties if such discontinuance is desirable in
the conduct of its business and the Issuer or the Company has concluded that
such discontinuance could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
 
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9.4
Payment of Taxes and Claims.

 
The Company will, will cause each Subsidiary to, and the Issuer will, file all
tax returns required to be filed in any jurisdiction (except in any case in
which the failure to file would not have a Material Adverse Effect) and to pay
and discharge all taxes shown to be due and payable on such returns and all
other taxes, assessments, governmental charges, or levies imposed on them or any
of their properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable, before they have become delinquent and
all claims for which sums have become due and payable that have or might have a
Lien on properties or assets of the Company or any Subsidiary or the Issuer,
provided that none of the Company, any Subsidiary or the Issuer need pay any
such tax or assessment or claims if (i) the amount, applicability or validity
thereof is contested on a timely basis in good faith and in appropriate
proceedings, and the Company, such Subsidiary or the Issuer has established
adequate reserves therefor in accordance with GAAP on its books or (ii) the
nonpayment of all such taxes, assessments and claims in the aggregate would not
have a Material Adverse Effect.
 
9.5
Corporate Existence, etc.

 
Subject to Section 10.3, the Company and the Issuer will at all times preserve
and keep its corporate or trust, as applicable, existence in full force and
effect. The Company will at all times preserve and keep in full force and effect
the corporate existence of each of its Subsidiaries (unless merged into the
Company or a Wholly-Owned Subsidiary) and all rights and franchises of the
Company and its Subsidiaries unless, in the good faith judgment of the Company,
the termination of or failure to preserve and keep in full force and effect such
corporate existence, right or franchise could not, individually or in the
aggregate, have a Material Adverse Effect.
 
9.6
Books and Records.

 
The Company and the Issuer will maintain proper books of record and account in
conformity with GAAP and all applicable requirements of any Governmental
Authority having legal or regulatory jurisdiction over the Issuer or the
Company, as the case may be.
 
9.7
Subsidiary Guarantor.

 
(a)          The Company will cause each of its Subsidiaries that guarantees or
otherwise becomes liable at any time, whether as a borrower or an additional or
co-borrower or otherwise, for or in respect of any Indebtedness under any
Material Credit Facility to concurrently therewith:
 
(i)          enter into an agreement in form and substance satisfactory to the
Required Holders providing for the guaranty by such Subsidiary, on a joint and
several basis with all other such Subsidiaries, of (x) the prompt payment in
full when due of all amounts payable by the Issuer and the Company pursuant to
the Notes (whether for principal, interest, Make-Whole Amount or otherwise) and
this Agreement, including all indemnities, fees and expenses payable by the
Issuer and the Company thereunder and (y) the prompt, full and faithful
performance, observance and discharge by the Issuer and the Company of each and
every covenant, agreement, undertaking and provision required pursuant to the
Notes or this Agreement to be performed, observed or discharged by it (a
“Subsidiary Guaranty”); and
 
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(ii)        deliver the following to each holder of a Note:
 
(a)          an executed counterpart of such Subsidiary Guaranty;
 
(b)         a certificate signed by an authorized responsible officer of such
Subsidiary containing representations and warranties on behalf of such
Subsidiary to the same effect, mutatis mutandis, as those contained in Sections
5.1, 5.2, 5.6 and 5.7 of this Agreement (but with respect to such Subsidiary and
such Subsidiary Guaranty rather than the Issuer and the Company);
 
(c)          all documents as may be reasonably requested by the Required
Holders to evidence the due organization, continuing existence and, where
applicable, good standing of such Subsidiary and the due authorization by all
requisite action on the part of such Subsidiary of the execution and delivery of
such Subsidiary Guaranty and the performance by such Subsidiary of its
obligations thereunder; and
 
(d)         an opinion of counsel reasonably satisfactory to the Required
Holders covering such matters relating to such Subsidiary and such Subsidiary
Guaranty as the Required Holders may reasonably request.
 
(b)          At the election of the Company and by written notice to each holder
of Notes, any Subsidiary Guarantor that has provided a Subsidiary Guaranty under
subparagraph (a) of this Section 9.7 may be discharged from all of its
obligations and liabilities under its Subsidiary Guaranty and shall be
automatically released from its obligations thereunder without the need for the
execution or delivery of any other document by the holders, provided that (i) if
such Subsidiary Guarantor is a guarantor or is otherwise liable for or in
respect of any Material Credit Facility, then such Subsidiary Guarantor has been
released and discharged (or will be released and discharged concurrently with
the release of such Subsidiary Guarantor under its Subsidiary Guaranty) under
such Material Credit Facility, (ii) at the time of, and immediately after giving
effect to, such release and discharge, no Default or Event of Default shall be
existing, (iii) no amount is then due and payable under such Subsidiary
Guaranty, (iv) if in connection with such Subsidiary Guarantor being released
and discharged under any Material Credit Facility, any fee or other form of
consideration is given to any holder of Indebtedness under such Material Credit
Facility for such release, the holders of the Notes shall receive equivalent
consideration substantially concurrently therewith and (v) each holder shall
have received a certificate of a Responsible Officer certifying as to the
matters set forth in clauses (i) through (iv). In the event of any such release,
for purposes of Section 10.6, all Indebtedness of such Subsidiary shall be
deemed to have been incurred concurrently with such release.
 
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10.
NEGATIVE COVENANTS.

 
Each of the Company and the Issuer covenants that so long as any of the Notes
are outstanding:
 
10.1
Debt to Capitalization Ratio.

 
The Company will not permit the ratio of (i) Total Consolidated Debt to (ii)
Total Consolidated Capital as of the last day of any fiscal quarter to be in
excess of 0.65 to 1.00.
 
10.2
Liens.

 
The Issuer and the Company will not, and the Company will not permit its
Subsidiaries to, permit to exist or incur, directly or indirectly, any Lien on
its Operating Property, whether now owned or hereafter acquired, unless the
Notes are equally and ratably secured by a Lien on the same property and assets,
except:
 
(a)          Liens that are not otherwise permitted by any of the other clauses
of this Section 10.2; provided that, at the time that any such Lien is granted
(and after giving effect thereto), the aggregate principal amount of all
Indebtedness outstanding under Section 10.6(c) and Indebtedness secured by Liens
permitted by this Section 10.2(a) shall not exceed 20% of Total Consolidated
Capital;
 
(b)          Liens to secure Indebtedness existing on the date of this Agreement
and described on Schedule 5.15, other than pursuant to the Credit Agreement or a
Mortgage Indenture, provided that such Indebtedness shall not be increased in
amount;
 
(c)          Liens on any Operating Property that existed on such property prior
to the acquisition thereof by the Company or any Subsidiary to secure
Indebtedness assumed by the Company or any Subsidiary in connection with such
acquisition;
 
(d)          Liens to secure Indebtedness incurred by the Company or any
Subsidiary in connection with the acquisition or lease by the Company or any
Subsidiary in the ordinary course of business, after the date of this Agreement,
of furniture, fixtures, equipment and other assets not owned by the Company or
any Subsidiary as of the date of issuance of the Notes provided that (i) such
Indebtedness shall not be secured by any Operating Property of the Company or
any Subsidiary other than the Operating Property with respect to which such
Indebtedness is incurred, and (ii) the Lien securing such Indebtedness shall be
created within 365 days of the incurrence of such Indebtedness;
 
(e)          Liens to secure Indebtedness of any Person existing at the time
such Person is merged into or consolidated with, or such Person disposes of all
or substantially all its properties (or those of a division) to, the Company or
any Subsidiary;
 
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(f)          Liens to secure Indebtedness incurred by the Company or any
Subsidiary to acquire, construct, develop or substantially repair, alter or
improve Operating Property or to provide funds for any such purpose or for
reimbursement of funds previously expended for any such purpose; provided that
such Indebtedness is incurred contemporaneously with, or within 730 days after,
such acquisition or the completion of construction, development or substantial
repair, alteration or improvement;
 
(g)          Liens to secure, directly or indirectly, the Company’s or any
Subsidiary’s obligations with respect to Indebtedness issued by any Governmental
Authority, including Indebtedness represented by securities issued by any such
Governmental Authority (or providers of credit enhancement with respect to such
securities), including, without limitation, the Company’s or any Subsidiary’s
obligations with respect to industrial development, pollution control or similar
revenue bonds incurred for the purpose of financing all or any part of the
purchase price or the cost of substantially repairing or altering, constructing,
developing or substantially improving Operating Property;
 
(h)          Liens to secure Indebtedness which has been defeased, including the
Notes;
 
(i)           Liens to secure Indebtedness incurred in connection with an
accounts receivable facility (including, without limitation, Liens on the
property of Finsub incurred pursuant to the Receivables Program Documents and
Liens in favor of Finsub granted by the Company with respect to Receivables
purportedly sold to Finsub by the Company pursuant to the Receivables Program)
and/or contract payments facility or the securitization of any Excepted Assets;
 
(j)          any Lien to secure the Notes;
 
(k)          Liens for taxes or assessments by any Governmental Authority not
yet due or being contested in good faith by appropriate proceedings;
 
(l)          carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s,
landlords’, licensors’ or other like Liens arising in the ordinary course of
business and securing obligations that are not due and payable;
 
(m)          pledges and deposits made in the ordinary course of the Company’s
or any Subsidiary’s business in compliance with workmen’s compensation,
unemployment insurance and other social security laws or regulations;
 
(n)          deposits by the Company or any Subsidiary to secure the performance
of bids, trade contracts (other than for Indebtedness), leases (other than
Capital Lease Obligations), statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
 
(o)          zoning restrictions, easements, rights-of-way, restrictions on use
of real property or permit or license requirements and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and do not materially detract from the
value of the property subject thereto or interfere with the ordinary conduct of
the businesses of the Company, the Issuer or any Subsidiary;
 
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(p)          one or more attachments or other similar Liens on assets of the
Company or any Subsidiary arising in connection with court proceedings so long
as the Company or any Subsidiary has set aside adequate reserves therefor or the
execution of which has been stayed or which has been appealed and secured, if
necessary, by an appeal bond; provided that in each case no Event of Default
shall result therefrom;
 
(q)          any Lien arising by operation of law on the assets of the Company
or any Subsidiary in favor of any Governmental Authority with respect to any
franchise, grant, license, permit or contract; and
 
(r)          Liens to secure any extension, renewal or replacement (or
successive extensions, renewals or replacements), in whole or in part, of an
instrument or agreement creating any Indebtedness referred to in the above
clauses, other than clauses (a) and (b) above;
 
provided that, notwithstanding the foregoing, the Issuer and the Company will
not, and the Company will not permit any of its Subsidiaries to, secure any
Indebtedness outstanding pursuant to Section 10.2(a) under any Material Credit
Facility unless and until the Notes (and any guarantee delivered in connection
therewith) shall concurrently be secured equally and ratably with such
Indebtedness pursuant to documentation reasonably acceptable to the Required
Holders in substance and in form, including an intercreditor agreement and
opinions of counsel to the Issuer from counsel that is reasonably acceptable to
the Required Holders.
 
10.3
Merger, Consolidation, etc.

 
(a)          The Company will not, and will not permit any Subsidiary Guarantor
to, and the Issuer will not consolidate with or merge with any other Person or
convey, transfer or lease all or substantially all of its assets in a single
transaction or series of transactions to any Person unless:
 
(i)          in the case of any such transaction involving the Company, the
successor formed by such consolidation or the survivor of such merger or the
Person that acquires by conveyance, transfer or lease all or substantially all
of the assets of the Company as an entirety, as the case may be, shall be a
solvent corporation or limited liability company organized and existing under
the laws of the United States or any State thereof (including the District of
Columbia), and, if the Company is not such corporation or limited liability
company, (i) such corporation or limited liability company shall have executed
and delivered to each holder of any Notes its assumption of the due and punctual
performance and observance of each covenant and condition of this Agreement and
the Notes and (ii) such corporation or limited liability company shall have
caused to be delivered to each holder of any Notes an opinion of nationally
recognized independent counsel, or other independent counsel reasonably
satisfactory to the Required Holders, to the effect that all agreements or
instruments effecting such assumption are enforceable in accordance with their
terms and comply with the terms hereof;
 
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(ii)         in the case of any such transaction involving the Issuer the
successor formed by such consolidation or the survivor of such merger or the
Person that acquires by conveyance, transfer or lease all or substantially all
of the assets of the Issuer as an entirety, as the case may be, shall be a
solvent corporation, limited liability company or trust organized and existing
under the laws of the United States or any State thereof (including the District
of Columbia), and, if the Issuer is not such corporation, limited liability
company or trust, (i) such corporation, limited liability company or trust shall
have executed and delivered to each holder of any Notes its assumption of the
due and punctual performance and observance of each covenant and condition of
this Agreement and the Notes and (ii) such corporation, limited liability
company or trust shall have caused to be delivered to each holder of any Notes
an opinion of nationally recognized independent counsel, or other independent
counsel reasonably satisfactory to the Required Holders, to the effect that all
agreements or instruments effecting such assumption are enforceable in
accordance with their terms and comply with the terms hereof;
 
(iii)        in the case of any such transaction involving a Subsidiary
Guarantor, the successor formed by such consolidation or the survivor of such
merger or the Person that acquires by conveyance, transfer or lease all or
substantially all of the assets of such Subsidiary Guarantor as an entirety, as
the case may be, shall be (1) the Company, such Subsidiary Guarantor or another
Subsidiary Guarantor; (2) a solvent corporation or limited liability company
(other than the Company or another Subsidiary Guarantor) that is organized and
existing under the laws of the United States or any State thereof (including the
District of Columbia) and, in the case of this clause (2), if such Subsidiary
Guarantor is not such corporation or limited liability company, (A) such
corporation or limited liability company shall have executed and delivered to
each holder of Notes its assumption of the due and punctual performance and
observance of each covenant and condition of the Subsidiary Guaranty of such
Subsidiary Guarantor and (B) the Company shall have caused to be delivered to
each holder of Notes an opinion of nationally recognized independent counsel, or
other independent counsel reasonably satisfactory to the Required Holders, to
the effect that all agreements or instruments effecting such assumption are
enforceable in accordance with their terms and comply with the terms hereof; or
(3) any other Person, and such Person is not required to become a Subsidiary
Guarantor pursuant to Section 9.7;
 
(iv)       each Subsidiary Guarantor under any Subsidiary Guaranty that is
outstanding at the time such transaction or each transaction in such a series of
transactions occurs reaffirms its obligations under such Subsidiary Guaranty in
writing at such time pursuant to documentation that is reasonably acceptable to
the Required Holders; and
 
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(v)         immediately before and immediately after giving effect to such
transaction or each transaction in any such series of transactions, no Default
or Event of Default shall have occurred and be continuing.
 
No such conveyance, transfer or lease of substantially all of the assets of the
Company, the Issuer or any Subsidiary Guarantor shall have the effect of
releasing the Company, the Issuer or such Subsidiary Guarantor, as the case may
be, or any successor corporation, limited liability company or trust that shall
theretofore have become such in the manner prescribed in this Section 10.3, from
its liability under (x) this Agreement or the Notes (in the case of the Company)
or (y) the Subsidiary Guaranty (in the case of any Subsidiary Guarantor),
unless, in the case of the conveyance, transfer or lease of substantially all of
the assets of a Subsidiary Guarantor, such Subsidiary Guarantor is released from
its Subsidiary Guaranty in accordance with Section 9.7(b) in connection with or
immediately following such conveyance, transfer or lease.
 
10.4
Economic Sanctions, Etc.

 
The Company will not, will not permit any Controlled Entity to, and the Issuer
will not (a) become (including by virtue of being owned or controlled by a
Blocked Person), own or control a Blocked Person or (b) directly or indirectly
have any investment in or engage in any dealing or transaction (including any
investment, dealing or transaction involving the proceeds of the Notes) with any
Person if such investment, dealing or transaction (i) would cause any holder or
any affiliate of such holder to be in violation of, or subject to sanctions
under, any law or regulation applicable to such holder, or (ii) is prohibited by
or subject to sanctions under any U.S. Economic Sanctions Laws
 
10.5
[Reserved].

 
10.6
Subsidiary Indebtedness.

 
The Company will not permit any Subsidiary that is not a Subsidiary Guarantor to
incur, create, assume or permit to exist (collectively, “incur”) any
Indebtedness, except:
 
(a)          Indebtedness of any Subsidiary owed to the Company or any
Subsidiary;
 
(b)          Indebtedness of any Receivables Subsidiary incurred pursuant to the
Receivables Program Documents in an aggregate principal amount not in excess of
$100,000,000 outstanding at any time; and
 
(c)          Indebtedness of Subsidiaries not permitted by the foregoing
paragraphs of this Section 10.6; provided that the aggregate principal amount of
all Indebtedness of all such Subsidiaries outstanding under this paragraph (c)
and Indebtedness secured by Liens permitted by Section 10.2(a) at any time shall
not exceed 20% of Total Consolidated Capital.
 
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10.7
Transactions with Affiliates.

 
The Company will not, and will not permit any Subsidiary to, and the Issuer will
not, sell or transfer any property or assets to, or purchase or acquire any
assets from, or otherwise engage in any other transactions with, any of its
Affiliates (other than Wholly-Owned Subsidiaries), except that (a) the Company
or any Subsidiary may engage in any of the foregoing transactions in the
ordinary course of business at prices and on terms and conditions not materially
less favorable to the Company or such Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties or if no comparable transaction
exists, on a basis that is fair to the Company or such Subsidiary from a
financial point of view and (b) the Company and any Subsidiary may sell
Receivables pursuant to a Receivables Program and (c) the Trustee may engage in
any transactions with its Affiliates expressly permitted under the Trust
Agreement.
 
10.8
Line of Business.

 
The Company will not, and will not permit any Material Subsidiary to, engage in
any business if, as a result, the general nature of the business in which the
Company and its Subsidiaries, taken as a whole, would then be engaged would be
substantially changed from the general nature of the business in which the
Company is engaged on the date of this Agreement. The Issuer will not engage in
any business at any time other than purchasing, holding title to, making
payments with respect to and selling Nuclear Fuel pursuant to, and on the terms
set forth in, the Trust Agreement and the Purchase Contract, or any successor
agreement thereto or similar agreement.
 
11.
EVENTS OF DEFAULT.

 
An “Event of Default” shall exist if any of the following conditions or events
shall occur and be continuing:
 
(a)          the Issuer defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or
 
(b)          the Issuer defaults in the payment of any interest on any Note for
more than five Business Days after the same becomes due and payable; or
 
(c)          the Issuer or the Company defaults in the performance of or
compliance with any term contained in Section 7.1(d) or Section 10.1; or
 
(d)          the Issuer, the Company or any Subsidiary Guarantor defaults in the
performance of or compliance with any term contained herein (other than those
referred to in paragraphs (a),(b) or (c) of this Section 11) or in any
Subsidiary Guaranty and such default is not remedied within 30 days after the
earlier of (i) the Issuer or a Responsible Officer obtaining actual knowledge of
such default and (ii) the Company or the Issuer receiving written notice of such
default from any holder of a Note (any such written notice to be identified as a
“notice of default” and to refer specifically to this paragraph (d) of Section
11); or
 
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(e)          (i) any representation or warranty made in writing by or on behalf
of the Issuer, the Company or by any officer of the Company in this Agreement or
in any writing furnished in connection with the transactions contemplated hereby
or thereby proves to have been false or incorrect in any material respect on the
date as of which made or (ii) any representation or warranty made in writing by
or on behalf of any Subsidiary Guarantor or by any officer of such Subsidiary
Guarantor in any Subsidiary Guaranty or any writing furnished in connection with
such Subsidiary Guaranty proves to have been false or incorrect in any material
respect on the date as of which made; or
 
(f)           the Issuer, the Company or any Subsidiary (i) is in default (as
principal or as guarantor or other surety) in the payment of any principal of or
premium or make-whole amount or interest on any Indebtedness when due (whether
by acceleration or otherwise) that is outstanding in an aggregate principal
amount of at least $50,000,000, for a period of 10 days or (ii) fail to observe
or perform any other term, covenant, condition or agreement contained in any
agreement or instrument evidencing or governing any such Indebtedness if the
effect of any failure referred to in this clause (ii) is to cause, or to permit
the holder or holders of such Indebtedness or a trustee on its or their behalf
(with or without the giving of notice, the lapse of time or both) to cause, such
Indebtedness to become due prior to its stated maturity; or
 
(g)          the Issuer, the Company or any Material Subsidiary (i) is generally
not paying, or admits in writing its inability to pay, its debts as they become
due, (ii) files, or consents by answer or otherwise to the filing against it of,
a petition for relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency,
reorganization, moratorium or other similar law of any jurisdiction, (iii) makes
an assignment for the benefit of its creditors, (iv) consents to the appointment
of a custodian, receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its property, (v) is
adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for
the purpose of any of the foregoing; or
 
(h)          a court or other Governmental Authority of competent jurisdiction
enters an order appointing, without consent by the Issuer, the Company or any
Material Subsidiary, a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial part of its
property, or constituting an order for relief or approving a petition for relief
or reorganization or any other petition in bankruptcy or for liquidation or to
take advantage of any bankruptcy or insolvency law of any jurisdiction, or
ordering the dissolution, winding-up or liquidation of the Issuer, the Company
or any Material Subsidiary, or any such petition shall be filed against the
Issuer or the Company and such petition shall not be dismissed within 90 days;
or
 
(i)           a final judgment or judgments for the payment of money aggregating
in excess of $50,000,000 are rendered against one or more of the Issuer, the
Company or any Material Subsidiary, which judgments are not, within 60 days
after entry thereof, bonded, discharged or stayed pending appeal, or are not
discharged within 60 days after the expiration of such stay; or
 
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(j)           if any event or events described in clauses (i) through (vi)
below, either individually or together with any other such event or events,
could reasonably be expected to have a Material Adverse Effect: (i) the Company
fails to make contributions necessary to satisfy the minimum funding standards
of ERISA or the Code for any plan year or part thereof or a waiver of such
standards or extension of any amortization period is sought or granted under
section 412 of the Code, (ii) a notice of intent to terminate any Plan shall
have been or is reasonably expected to be filed with the PBGC or the PBGC shall
have instituted proceedings under ERISA section 4042 to terminate or appoint a
trustee to administer any Plan or the PBGC shall have notified the Company or
any ERISA Affiliate that a Plan may become a subject of any such proceedings,
(iii) the determination that any Plan is in “at-risk status” (within the meaning
of Section 430 of the Code or Section 303 of ERISA), (iv) the Company or any
ERISA Affiliate shall have incurred or is reasonably expected to incur any
liability pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans, (v) the Company or
any ERISA Affiliate withdraws from any Multiemployer Plan, or (vi) the Company
or any Subsidiary establishes or amends any employee welfare benefit plan that
provides post-employment welfare benefits in a manner that would increase the
liability of the Company thereunder in a Material way; or
 
(k)          the guaranty of the Company ceases to be in full force and effect,
or is declared to be null and void in whole or in material part by a court or
other governmental or regulatory authority having jurisdiction, or the validity
or enforceability thereof shall be contested by either the Issuer or the Company
or either of them renounces any of the same or denies that it has any or further
liability thereunder; or
 
(l)           any Subsidiary Guaranty shall cease to be in full force and
effect, any Subsidiary Guarantor or any Person acting on behalf of any
Subsidiary Guarantor shall contest in any manner the validity, binding nature or
enforceability of any Subsidiary Guaranty, or the obligations of any Subsidiary
Guarantor under any Subsidiary Guaranty are not or cease to be legal, valid,
binding and enforceable in accordance with the terms of such Subsidiary
Guaranty.
 
As used in Section 11(j), the terms “employee benefit plan” and “employee
welfare benefit plan” shall have the respective meanings assigned to such terms
in section 3 of ERISA.
 
12.
REMEDIES ON DEFAULT, ETC.

 
12.1
Acceleration.

 
(a)          If an Event of Default with respect to the Issuer or the Company
described in paragraph (g) or (h) of Section 11 (other than an Event of Default
described in clause (i) of paragraph (g) or described in clause (vi) of
paragraph (g) by virtue of the fact that such clause encompasses clause (i) of
paragraph (g)) has occurred, all the Notes then outstanding shall automatically
become immediately due and payable.
 
(b)          If any other Event of Default has occurred and is continuing, any
holder or holders of at least 51% in principal amount of the Notes at the time
outstanding may at any time at its or their option, by notice or notices to the
Issuer, declare all the Notes then outstanding to be immediately due and
payable.
 
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(c)          If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder or holders of Notes at the
time outstanding affected by such Event of Default may at any time, at its or
their option, by notice or notices to the Issuer, declare all the Notes held by
it or them to be immediately due and payable.
 
Upon any Notes becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Notes will forthwith mature and the entire
unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest
thereon (including, but not limited to, interest accrued thereon at the Default
Rate) and (y) the Make-Whole Amount determined in respect of such principal
amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The parties
hereto agree, that each holder of a Note has the right to maintain its
investment in the Notes free from repayment by the Issuer (except as herein
specifically provided for) and that the provision for payment of a Make-Whole
Amount by the Issuer in the event that the Notes are prepaid or are accelerated
as a result of an Event of Default, is intended to provide compensation for the
deprivation of such right under such circumstances.
 
12.2
Other Remedies.

 
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein or in any Note, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise.
 
12.3
Rescission.

 
At any time after any Notes have been declared due and payable pursuant to
Section 12.1(b) or (c), the Required Holders, by written notice to the Company
and to the Issuer, may rescind and annul any such declaration and its
consequences if (a) the Issuer has paid all overdue interest on the Notes, all
principal of and Make-Whole Amount, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the Default Rate, (b) neither the Issuer nor any other Person shall
have paid any amounts which have become due solely by reason of such
declaration, (c) all Events of Default and Defaults, other than non-payment of
amounts that have become due solely by reason of such declaration, have been
cured or have been waived pursuant to Section 18, and (d) no judgment or decree
has been entered for the payment of any monies due pursuant hereto or to the
Notes. No rescission and annulment under this Section 12.3 will extend to or
affect any subsequent Event of Default or Default or impair any right consequent
thereon.
 
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12.4
No Waivers or Election of Remedies, Expenses, etc.

 
No course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder’s rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
 
13.
GUARANTY OF NOTES.

 
As a result of the arrangements contemplated by the Trust Agreement and the
Purchase Contract for the financing by the Issuer of nuclear fuel, the Company
acknowledges that it will derive substantial benefit from the issuance of the
Notes. To induce the holders of Notes to enter into this Agreement, the Company
agrees with each Purchaser and any other holder of Notes (each such person,
together with its successors and assigns permitted by this Agreement, a
“Guaranteed Party”) as follows:
 
13.1
Guarantee.

 
The Company unconditionally guarantees, as a primary obligor and not merely as a
surety, (a) the due and punctual payment of (i) the principal of and premium
(including Make-Whole Amount), if any, and interest (including interest accruing
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Notes, when and as due, whether at maturity, by acceleration, upon one or
more dates set for prepayment or otherwise, and (ii) all other monetary
obligations, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of the Issuer to the Guaranteed Parties under
this Agreement and (b) the due and punctual performance of all covenants,
agreements, obligations and liabilities of the Issuer under or pursuant to this
Agreement or the Notes (all the monetary and other obligations referred to in
the preceding clauses (a) and (b) being collectively called the “Obligations”).
The Company further agrees that the Obligations may be extended or renewed, in
whole or in part, without notice to or further assent from it, and that it will
remain bound upon its guarantee notwithstanding any extension or renewal of any
Obligation.
 
13.2
Obligations Not Waived.

 
To the fullest extent permitted by applicable law, the Company waives
presentment to, demand of payment from and protest to the Issuer of any of the
Obligations, and also waives notice of acceptance of its guarantee and notice of
protest for nonpayment. To the fullest extent permitted by applicable law, the
obligations of the Company hereunder shall not be affected by (a) the failure of
any Guaranteed Party to assert any claim or demand or to enforce or exercise any
right or remedy against the Issuer or (b) any rescission, waiver, amendment or
modification of, or any release from any of the terms or provisions of this
Agreement or any other agreement, including with respect to any other guarantor
of the Obligations.
 
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13.3
[Reserved].

 
13.4
Guarantee of Payment.

 
The Company further agrees that its guarantee constitutes a guarantee of payment
when due and not of collection, and waives any right to require that any resort
be had by any Guaranteed Party to any of the security held for payment of the
Obligations, if any, or to any balance of any deposit account or credit on the
books of any Guaranteed Party in favor of the Issuer or any other person.
 
13.5
No Discharge or Diminishment of Guarantee.

 
The obligations of the Company hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason (other than the payment in
full in cash of the Obligations), including any claim of waiver, release,
surrender, alteration or compromise of any of the Obligations, and shall not be
subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of the Company hereunder shall not be discharged or impaired or
otherwise affected by the failure of any Guaranteed Party to assert any claim or
demand or to enforce any remedy under this Agreement, any Note or any other
agreement, by any waiver or modification of any provision of any thereof, by any
default, failure or delay, willful or otherwise, in the performance of the
Obligations, or by any other act or omission that may or might in any manner or
to any extent vary the risk of the Company or that would otherwise operate as a
discharge of the Company as a matter of law or equity (other than the payment in
full in cash of all the Obligations).
 
13.6
Defenses of the Issuer Waived.

 
To the fullest extent permitted by applicable law, the Company waives any
defense based on or arising out of any defense of the Issuer or the
unenforceability of the Obligations or any part thereof from any cause, or the
cessation from any cause of the liability of the Issuer, other than the payment
in full in cash of the Obligations. The Guaranteed Parties may, at their
election, foreclose on any security held by one or more of them by one or more
judicial or nonjudicial sales, accept an assignment of any such security in lieu
of foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with the Issuer or any other guarantor or exercise any other right
or remedy available to them against the Issuer or any other guarantor, without
affecting or impairing in any way the liability of the Company hereunder except
to the extent the Obligations have been fully, finally paid in cash. To the
fullest extent permitted by applicable law, the Company waives any defense
arising out of any such election even though such election operates, pursuant to
applicable law, to impair or to extinguish any right of reimbursement or
subrogation or other right or remedy of the Company against the Issuer or any
other guarantor, as the case may be, or any security.
 
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13.7
Agreement to Pay; Subrogation.

 
In furtherance of the foregoing and not in limitation of any other right that
any Guaranteed Party has at law or in equity against the Company by virtue
hereof, upon the failure of the Issuer to pay any Obligation when and as the
same shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, the Company hereby promises to and will forthwith pay,
or cause to be paid, to each Guaranteed Party in cash the amount of such unpaid
Obligations. Upon payment by the Company of any sums to each Guaranteed Party as
provided above, all rights of the Company against the Issuer arising as a result
thereof by way of right of subrogation, contribution, reimbursement, indemnity
or otherwise shall in all respects be subordinate and junior in right of payment
to the prior payment in full in cash of all the Obligations. In addition, any
indebtedness of the Issuer now or hereafter held by the Company is hereby
subordinated in right of payment to the prior payment in full of the
Obligations. If any amount shall erroneously be paid to the Company on account
of (i) such subrogation, contribution, reimbursement, indemnity or similar right
or (ii) any such indebtedness of the Issuer, such amount shall be held in trust
for the benefit of the Guaranteed Parties and shall forthwith be paid to the
Guaranteed Parties to be credited against the payment of the Obligations,
whether matured or unmatured, in accordance with the terms of this Agreement and
the Notes.
 
13.8
Information.

 
The Company assumes all responsibility for being and keeping itself informed of
the Issuer’s financial condition and assets, and of all other circumstances
bearing upon the risk of nonpayment of the Obligations and the nature, scope and
extent of the risks that the Company assumes and incurs hereunder, and agrees
that none of the Guaranteed Parties will have any duty to advise the Company of
information known to it or any of them regarding such circumstances or risks.
 
13.9
Termination.

 
The guarantee made hereunder (a) shall terminate when all the Obligations have
been indefeasibly paid in full and (b) shall continue to be effective or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any Obligation is rescinded or must otherwise be restored by any Guaranteed
Party or the Company upon the bankruptcy or reorganization of the Issuer, the
Company or otherwise.
 
14.
REGISTRATION; EXCHANGE; SUBSTITUTION; TRANSFER OF NOTES.

 
14.1
Registration of Notes.

 
The Company, acting as agent for the Issuer, shall keep at its principal
executive office in the United States a register for the registration and
registration of transfers of Notes. The name and address of each holder of one
or more Notes and the principal amounts thereof, each transfer thereof and the
name and address of each transferee of one or more Notes shall be registered in
such register. If any holder of one or more Notes is a nominee, then (a) the
name and address of the beneficial owner of such Note or Notes shall also be
registered in such register as an owner and holder thereof and (b) at any such
beneficial owner’s option, either such beneficial owner or its nominee may
execute any amendment, waiver or consent pursuant to this Agreement. Prior to
due presentment for registration of transfer, the Person in whose name any Note
shall be registered shall be deemed and treated as the owner and holder thereof
for all purposes absent manifest error, and the Issuer shall not be affected by
any notice or knowledge to the contrary. The Company shall give to any holder of
a Note that is an Institutional Accredited Investor, promptly upon request
therefor, a complete and correct copy of the names and addresses of all
registered holders of Notes.
 
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14.2
Transfer and Exchange of Notes.

 
Upon surrender of any Note to the Issuer at the address and to the attention of
the designated officer (all as specified in Section 19(iv)), for registration of
transfer or exchange (and in the case of a surrender for registration of
transfer accompanied by a written instrument of transfer duly executed by the
registered holder of such Note or such holder’s attorney duly authorized in
writing and accompanied by the relevant name, address and other information for
notices of each transferee of such Note or part thereof), the Issuer shall
execute and deliver within 10 Business Days, at the Issuer’s expense (except as
provided below), one or more new Notes (as requested by the holder thereof) in
exchange therefor, in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. Each such new Note shall be payable to
such Person as such holder may request and shall be substantially in the form of
Exhibit 1. Each such new Note shall be dated and bear interest from the date to
which interest shall have been paid on the surrendered Note or dated the date of
the surrendered Note if no interest shall have been paid thereon. The Issuer may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes. Notes shall not be
transferred in denominations of less than $100,000, provided that if necessary
to enable the registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $100,000. Any transferee,
by its acceptance of a Note registered in its name (or the name of its nominee),
shall be deemed to have made the representations set forth in Section 6.
 
14.3
Replacement of Notes.

 
Upon receipt by the Issuer at the address and to the attention of the designated
officer (all as specified in Section 19(iv)) of evidence reasonably satisfactory
to it of the ownership of and the loss, theft, destruction or mutilation of any
Note (which evidence shall be, in the case of an Institutional Accredited
Investor, notice from such Institutional Accredited Investor of such ownership
and such loss, theft, destruction or mutilation), and
 
(a)          in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a nominee
for, an original Purchaser or another holder of a Note with a minimum net worth
of at least $50,000,000 or an Institutional Accredited Investor, such Person’s
own unsecured agreement of indemnity shall be deemed to be satisfactory), or
 
(b)          in the case of mutilation, upon surrender and cancellation thereof,
 
the Issuer at its own expense shall execute and deliver within 10 Business Days,
in lieu thereof, a new Note, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.
 
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15.
PAYMENTS ON NOTES.

 
15.1
Place of Payment.

 
Subject to Section 15.2, payments of principal, Make-Whole Amount, if any, and
interest becoming due and payable on the Notes shall be made in New York, New
York at the principal office of The Bank of New York Mellon in such
jurisdiction. The Issuer may at any time, by notice to each holder of a Note,
change the place of payment of the Notes so long as such place of payment shall
be either the principal office of the Issuer in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
 
15.2
Home Office Payment.

 
So long as any Purchaser or its nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 15.1 or in such Note to the
contrary, the Issuer will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest and all other amounts becoming due
hereunder by the method and at the address specified for such purpose below such
Purchaser’s name in Schedule A, or by such other method or at such other address
as such Purchaser shall have from time to time specified to the Issuer in
writing for such purpose, without the presentation or surrender of such Note or
the making of any notation thereon, except that upon written request of the
Issuer made concurrently with or reasonably promptly after payment or prepayment
in full of any Note, such Purchaser shall surrender such Note for cancellation,
reasonably promptly after any such request, to the Issuer at its principal
executive office or at the place of payment most recently designated by the
Issuer pursuant to Section 15.1. Prior to any sale or other disposition of any
Note held by a Purchaser or its nominee, such Purchaser will, at its election,
either endorse thereon the amount of principal paid thereon and the last date to
which interest has been paid thereon or surrender such Note to the Issuer in
exchange for a new Note or Notes pursuant to Section 14.2. The Issuer will
afford the benefits of this Section 15.2 to any Institutional Accredited
Investor that is the direct or indirect transferee of any Note purchased by a
Purchaser under this Agreement and that has made the same agreement relating to
such Note as the Purchasers have made in this Section 15.2.
 
15.3
FATCA Information.

 
By acceptance of any Note, the holder of such Note agrees that such holder will
with reasonable promptness duly complete and deliver to the Issuer and the
Company, or to such other Person as may be reasonably requested by the Issuer or
the Company, from time to time (a) in the case of any such holder that is a
United States Person, such holder’s United States tax identification number or
other Forms reasonably requested by the Issuer or the Company necessary to
establish such holder’s status as a United States Person under FATCA and as may
otherwise be necessary for the Issuer or the Company to comply with its
obligations under FATCA and (b) in the case of any such holder that is not a
United States Person, such documentation prescribed by applicable law (including
as prescribed by section 1471(b)(3)(C)(i) of the Code) and such additional
documentation as may be necessary for the Issuer or the Company to comply with
its obligations under FATCA and to determine that such holder has complied with
such holder’s obligations under FATCA or to determine the amount (if any) to
deduct and withhold from any such payment made to such holder. Nothing in this
Section 15.3 shall require any holder to provide information that is
confidential or proprietary to such holder unless the Issuer or the Company is
required to obtain such information under FATCA and, in such event, the Issuer
and the Company, as the case may be, shall treat any such information it
receives as confidential.
 
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16.
EXPENSES, ETC.

 
16.1
Transaction Expenses.

 
Whether or not the transactions contemplated hereby are consummated, the Issuer
will pay all costs and expenses (including reasonable attorneys’ fees of one
special counsel and, if reasonably required by the Required Holders, local or
other counsel) incurred by the Purchasers and each other holder of a Note in
connection with such transactions and in connection with any amendments, waivers
or consents under or in respect of this Agreement or the Notes (whether or not
such amendment, waiver or consent becomes effective), including, without
limitation: (a) the costs and expenses incurred in enforcing or defending (or
determining whether or how to enforce or defend) any rights under this Agreement
or the Notes or in responding to any subpoena or other legal process or informal
investigative demand issued in connection with this Agreement or the Notes, or
by reason of being a holder of any Note, (b) the costs and expenses, including
financial advisors’ fees, incurred in connection with the insolvency or
bankruptcy of the Issuer, the Company or any Subsidiary or in connection with
any work-out or restructuring of the transactions contemplated hereby and by the
Notes and (c) the costs and expenses incurred in connection with the initial
filing of this Agreement and all related documents and financial information
with the SVO; provided, that such costs and expenses shall not exceed $3,500.
The Issuer will pay, and will save each Purchaser or holder of a Note harmless
from, all claims in respect of any fees, costs or expenses, if any, of brokers
and finders (other than those, if any, retained by a Purchaser or other holder
in connection with its purchase of the Notes). Each Purchaser severally agrees
to pay, and agree to hold the Issuer and the Company harmless from, all claims
in respect of any fees, costs or expenses, if any, of brokers or finders
retained by such Purchaser; provided that, in connection with the initial sale
of the Notes, MUFG Securities Americas Inc. and U.S. Bancorp Investments, Inc.
shall be considered a broker or finder retained by the Issuer.
 
16.2
Survival.

 
The obligations of the Issuer under this Section 16 will survive the payment or
transfer of any Note, the enforcement, amendment or waiver of any provision of
this Agreement or the Notes, and the termination of this Agreement.
 
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17.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

 
All representations and warranties contained herein shall survive the execution
and delivery of this Agreement and the Notes, the purchase or transfer by any
Purchaser of any Note or portion thereof or interest therein and the payment of
any Note, and may be relied upon by any subsequent holder of a Note, regardless
of any investigation made at any time by or on behalf of such Purchaser or any
other holder of a Note. All statements contained in any certificate or other
instrument delivered by or on behalf of the Issuer or the Company pursuant to
this Agreement shall be deemed representations and warranties of the Issuer or
the Company under this Agreement, as applicable. Subject to the preceding
sentence, this Agreement and the Notes embody the entire agreement and
understanding between each Purchaser, the Issuer and the Company and supersede
all prior agreements and understandings relating to the subject matter hereof.
 
18.
AMENDMENT AND WAIVER.

 
18.1
Requirements.

 
This Agreement and the Notes may be amended, and the observance of any term
hereof or of the Notes may be waived (either retroactively or prospectively),
with (and only with) the written consent of the Issuer, the Company and the
Required Holders, except that (a) no amendment or waiver of any of the
provisions of Section 1, 2, 3, 4, 5, 6 or 22 hereof, or any defined term (as it
is used in such sections), will be effective as to any Purchaser unless
consented to by such Purchaser in writing, and (b) no such amendment or waiver
may, without the written consent of the holder of each Note at the time
outstanding affected thereby, (i) subject to the provisions of Section 12
relating to acceleration or rescission, change the amount or time of any
prepayment or payment of principal of, or reduce the rate or change the time of
payment or method of computation of interest or of the Make-Whole Amount on, the
Notes, (ii) change the percentage of the principal amount of the Notes the
holders of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 18 or 21.
 
18.2
Solicitation of Holders of Notes.

 
(a)          Solicitation. The Company and the Issuer will provide each holder
of the Notes (irrespective of the amount of Notes then owned by it) with
sufficient information, sufficiently far in advance of the date a decision is
required, to enable such holder to make an informed and considered decision with
respect to any proposed amendment, waiver or consent in respect of any of the
provisions hereof or of the Notes. The Company or the Issuer will deliver
executed or true and correct copies of each amendment, waiver or consent
effected pursuant to the provisions of this Section 18 to each holder of
outstanding Notes promptly following the date on which it is executed and
delivered by, or receives the consent or approval of, the requisite holders of
Notes.
 
(b)          Payment. Neither the Company nor the Issuer will directly or
indirectly pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, or grant any security or
provide other credit support, to any holder of Notes as consideration for or as
an inducement to the entering into by any holder of Notes of any waiver or
amendment of any of the terms and provisions hereof unless such remuneration is
concurrently paid, or security is concurrently granted or other credit support
concurrently provided, on the same terms, ratably to each holder of Notes then
outstanding even if such holder did not consent to such waiver or amendment.
 
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(c)          Consent in Contemplation of Transfer. Any consent given pursuant to
this Section 18 or any Subsidiary Guaranty by a holder of a Note that has
transferred or has agreed to transfer its Note to (i) the Company, (ii) any
Subsidiary or any other Affiliate or (iii) any other Person in connection with,
or in anticipation of, such other Person acquiring, making a tender offer for or
merging with the Company and/or any of its Affiliates (either pursuant to a
waiver under Section 18.1 or subsequent to Section 8.6 having been amended
pursuant to Section 18.1), in each case in connection with such consent, shall
be void and of no force or effect except solely as to such holder, and any
amendments effected or waivers granted or to be effected or granted that would
not have been or would not be so effected or granted but for such consent (and
the consents of all other holders of Notes that were acquired under the same or
similar conditions) shall be void and of no force or effect except solely as to
such holder.
 
18.3
Binding Effect, etc.

 
Any amendment or waiver consented to as provided in this Section 18 applies
equally to all holders of Notes and is binding upon them and upon each future
holder of any Note and upon the Issuer and the Company without regard to whether
such Note has been marked to indicate such amendment or waiver. No such
amendment or waiver will extend to or affect any obligation, covenant,
agreement, Default or Event of Default not expressly amended or waived or impair
any right consequent thereon. No course of dealing between the Issuer, the
Company and the holder of any Note nor any delay in exercising any rights
hereunder or under any Note shall operate as a waiver of any rights of any
holder of such Note. As used herein, the term “this Agreement” or “the
Agreement” and references thereto shall mean this Agreement as it may from time
to time be amended or supplemented.
 
18.4
Notes held by the Issuer, etc.

 
Solely for the purpose of determining whether the holders of the requisite
percentage of the aggregate principal amount of Notes then outstanding approved
or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company, the Issuer or
any of their Affiliates shall be deemed not to be outstanding.
 
19.
NOTICES.

 
Except with respect to Electronic Notices permitted pursuant to Section 7, all
notices and communications provided for hereunder shall be in writing and sent
(a) by telecopy if the sender on the same day sends a confirming copy of such
notice by a recognized overnight delivery service (charges prepaid), or (b) by
registered or certified mail with return receipt requested (postage prepaid), or
(c) by a recognized overnight delivery service (with charges prepaid). Any such
notice must be sent:
 
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(i)          if to any Purchaser or its nominee, to such Purchaser or nominee at
the address specified for such communications in Schedule A, or at such other
address as such Purchaser or nominee shall have specified to the Company in
writing,
 
(ii)         if to any other holder of any Note, to such holder at such address
as such other holder shall have specified to the Company in writing,
 
(iii)        if to the Company, to the Company at its address set forth at the
beginning hereof to the attention of Office of the General Counsel, or at such
other address as the Company shall have specified to the holder of each Note in
writing, or
 
(iv)        if to the Issuer, to the Trustee at The Bank of New York Mellon
Trust Company, N.A., 601 Travis Street, 16th Floor, Houston, TX 77002 to the
attention of Corporate Finance, or at such other address as the Trustee shall
have specified to the holder of each Note in writing
 
Notices under this Section 19 will be deemed given only when actually received.
 
20.
REPRODUCTION OF DOCUMENTS.

 
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to any Purchaser, may be
reproduced by any Person who is a party to or recipient of any such document by
any photographic, photostatic, electronic, digital, or other similar process and
such Purchaser may destroy any original document so reproduced. Each of the
Company, the Issuer and each Purchaser agrees and stipulates that, to the extent
permitted by applicable law, 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 such Purchaser in the regular course of business) and
any enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence. This Section 20 shall not prohibit the
Company, the Issuer or any other holder of Notes from contesting any such
reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
 
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21.
CONFIDENTIAL INFORMATION.

 
For the purposes of this Section 21, “Confidential Information” means (A)
information delivered to any Purchaser by or on behalf of the Issuer, the
Company or its Subsidiaries in connection with the transactions contemplated by
or otherwise pursuant to this Agreement that is proprietary or confidential in
nature and that was clearly marked or labeled or otherwise adequately identified
when received by such Purchaser as being confidential information of the Issuer,
the Company or its Subsidiaries, (B) all information pertaining to systems
defined as “critical cyber assets” under the Critical Infrastructure Protection
Standards promulgated by the North American Electric Reliability Corporation and
(C) all “critical energy infrastructure information” and other information
concerning “critical infrastructure” as such terms are defined by the Federal
Energy Regulatory Commission pursuant to 18 C.F.R. §388.113(c) as may be amended
or re-codified, provided that in the case of clause (A), such term does not
include information that (a) was publicly known or otherwise known to such
Purchaser prior to the time of such disclosure, (b) subsequently becomes
publicly known through no act or omission by such Purchaser or any Person acting
on such Purchaser’s behalf, (c) otherwise becomes known to such Purchaser other
than through disclosure by the Issuer, the Company or its Subsidiaries, or (d)
constitutes financial statements delivered to such Purchaser under Section 7.1
that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such Purchaser, provided that such Purchaser may
deliver or disclose Confidential Information to (i) its directors, officers,
employees, agents, attorneys, trustees and affiliates (to the extent such
disclosure reasonably relates to the administration of the investment
represented by its Notes), (ii) its auditors, financial advisors and other
professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 21, (iii)
any other holder of any Note, (iv) any Institutional Accredited Investor to
which it sells or offers to sell such Note or any part thereof or any
participation therein (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this Section
21), (v) any Person from which it offers to purchase any security of the Issuer
(if such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 21), (vi) any federal
or state regulatory authority having jurisdiction over such Purchaser, (vii) the
NAIC or the SVO or, in each case, any similar organization, or any nationally
recognized rating agency that requires access to information about such
Purchaser’s investment portfolio or (viii) any other Person to which such
delivery or disclosure may be necessary or appropriate (w) to effect compliance
with any law, rule, regulation or order applicable to such Purchaser, (x) in
response to any subpoena or other legal process (provided that, subject to
clause (z) below, if not prohibited by applicable law, such Purchaser shall use
commercially reasonable efforts to give notice thereof to the Company and the
Issuer prior to such disclosure), (y) in connection with any litigation to which
such Purchaser is a party (provided that, subject to clause (z) below, if not
prohibited by applicable law, such Purchaser shall use commercially reasonable
efforts to give notice thereof to the Company and the Issuer prior to such
disclosure) or (z) if an Event of Default has occurred and is continuing, to the
extent such Purchaser may reasonably determine such delivery and disclosure to
be necessary or appropriate in the enforcement or for the protection of the
rights and remedies under such Purchaser’s Notes and this Agreement. Each holder
of a Note, by its acceptance of a Note, will be deemed to have agreed to be
bound by and to be entitled to the benefits of this Section 21 as though it were
a party to this Agreement. On reasonable request by the Company or the Issuer in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Issuer and the Company embodying
the provisions of this Section 21.
 
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22.
SUBSTITUTION OF PURCHASER.

 
Each Purchaser shall have the right to substitute any one of its Affiliates or
another Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute
Purchaser”) as the purchaser of the Notes that it has agreed to purchase
hereunder, by written notice to the Issuer, which notice shall be signed by both
such Purchaser and such Substitute Purchaser, shall contain such Substitute
Purchaser’s agreement to be bound by this Agreement and shall contain a
confirmation by such Substitute Purchaser of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such notice, any
reference to such Purchaser in this Agreement (other than in this Section 22),
shall be deemed to refer to such Substitute Purchaser in lieu of such original
Purchaser. In the event that such Substitute Purchaser is so substituted as a
purchaser hereunder and such Substitute Purchaser thereafter transfers to such
original Purchaser all of the Notes then held by such Substitute Purchaser, upon
receipt by the Issuer of notice of such transfer, any reference to such
Substitute Purchaser as a “Purchaser” is used in this Agreement (other than in
this Section 22), shall no longer be deemed to refer to such Substitute
Purchaser, but shall refer to such original Purchaser, and such original
Purchaser shall have all the rights of an original holder of the Notes under
this Agreement.
 
23.
MISCELLANEOUS.

 
23.1
Successors and Assigns.

 
All covenants and other agreements contained in this Agreement by or on behalf
of any of the parties hereto bind and inure to the benefit of their respective
successors and assigns (including any subsequent holder of a Note) whether so
expressed or not, except that, subject to Section 10.3, neither the Issuer nor
the Company may assign or otherwise transfer any of its rights or obligations
hereunder or under the Notes without the prior written consent of each holder.
Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto and their respective successors
and assigns permitted hereby) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
 
23.2
Payments Due on Non-Business Days.

 
Anything in this Agreement or the Notes to the contrary notwithstanding (but
without limiting the requirement in Section 8.5 that the notice of any optional
prepayment specify a Business Day as the date fixed for such prepayment), any
payment of principal of or Make-Whole Amount or interest on any Note that is due
on a date other than a Business Day shall be made on the next succeeding
Business Day without including the additional days elapsed in the computation of
the interest payable on such next succeeding Business Day; provided that if the
maturity date of any Note is a date other than a Business Day, the payment
otherwise due on such maturity date shall be made on the next succeeding
Business Day and shall include the additional days elapsed in the computation of
interest payable on such next succeeding Business Day.
 
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23.3
Accounting Terms.

 
All accounting terms used herein that are not expressly defined in this
Agreement have the meanings respectively given to them in accordance with GAAP.
Except as otherwise specifically provided herein, (i) all computations made
pursuant to this Agreement shall be made in accordance with GAAP and (ii) all
financial statements shall be prepared in accordance with GAAP; provided,
however, that in the event of a change in GAAP, the Company and the Required
Holders shall negotiate in good faith to revise (if appropriate) such ratios and
covenants to give effect to the intention of the parties under this Agreement as
at the date of this Agreement. In the event that such negotiation is
unsuccessful, all calculations thereafter made for the purpose of determining
compliance with the financial ratios and financial covenants contained herein
shall be made on a basis consistent with GAAP in existence as at the date of
this Agreement.
 
For purposes of determining compliance with this Agreement (including Section 9,
Section 10 and the definition of “Indebtedness”), any election by the Company or
the Issuer to measure any financial liability using fair value (as permitted by
Financial Accounting Standards Board Accounting Standards Codification Topic No.
825-10-25 – Fair Value Option, International Accounting Standard 39 – Financial
Instruments: Recognition and Measurement or any similar accounting standard)
shall be disregarded and such determination shall be made as if such election
had not been made.
 
23.4
Severability.

 
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
 
23.5
Construction.

 
Each covenant contained herein shall be construed (absent express provision to
the contrary) as being independent of each other covenant contained herein, so
that compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant. Where any
provision herein refers to action to be taken by any Person, or which such
Person is prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such Person.
 
For the avoidance of doubt, all Schedules and Exhibits attached to this
Agreement shall be deemed to be a part hereof.
 
As of the date of this Agreement, the Company has no Subsidiaries. References in
this Agreement to the Company’s Subsidiaries shall be ignored unless the Company
has one or more Subsidiaries at the relevant time.
 
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23.6
Counterparts.

 
This Agreement may be executed in any number of counterparts, each of which
shall be an original but all of which together shall constitute one instrument.
Each counterpart may consist of a number of copies hereof, each signed by less
than all, but together signed by all, of the parties hereto.
 
23.7
Governing Law.

 
This Agreement shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of New York
excluding choice-of-law principles of the law of such State that would permit
the application of the laws of a jurisdiction other than such State.
 
23.8
Jurisdiction and Process; Waiver of Jury Trial.

 
(a)          The Issuer and the Company irrevocably submit to the non-exclusive
jurisdiction of any New York State or federal court sitting in the Borough of
Manhattan, The City of New York, over any suit, action or proceeding arising out
of or relating to this Agreement or the Notes. To the fullest extent permitted
by applicable law, the Issuer and the Company irrevocably waive and agree not to
assert, by way of motion, as a defense or otherwise, any claim that it is not
subject to the jurisdiction of any such court, any objection that it may now or
hereafter have to the laying of the venue of any such suit, action or proceeding
brought in any such court and any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum.
 
(b)          The Issuer and the Company agree, to the fullest extent permitted
by applicable law, that a final judgment in any suit, action or proceeding of
the nature referred to in Section 23.8(a) brought in any such court shall be
conclusive and binding upon it subject to rights of appeal, as the case may be,
and may be enforced in the courts of the United States of America or the State
of New York (or any other courts to the jurisdiction of which it or any of its
assets is or may be subject) by a suit upon such judgment.
 
(c)          The Issuer and the Company consent to process being served by or on
behalf of any holder of Notes in any suit, action or proceeding of the nature
referred to in Section 23.8(a) by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage prepaid,
return receipt requested, to it at its address specified in Section 19 or at
such other address of which such holder shall then have been notified pursuant
to said Section. The Issuer and the Company agree that such service upon receipt
(i) shall be deemed in every respect effective service of process upon it in any
such suit, action or proceeding and (ii) shall, to the fullest extent permitted
by applicable law, be taken and held to be valid personal service upon and
personal delivery to it. Notices hereunder shall be conclusively presumed
received as evidenced by a delivery receipt furnished by the United States
Postal Service or any reputable commercial delivery service.
 
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(d)          Nothing in this Section 23.8 shall affect the right of any holder
of a Note to serve process in any manner permitted by law, or limit any right
that the holders of any of the Notes may have to bring proceedings against the
Issuer or the Company in the courts of any appropriate jurisdiction or to
enforce in any lawful manner a judgment obtained in one jurisdiction in any
other jurisdiction.
 
(e)          THE PARTIES HERETO WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR
WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN
CONNECTION HEREWITH OR THEREWITH.
 
23.9
Limitation of Liability and Trustee’s Obligations.

 
It is expressly understood and agreed by the Company and each Purchaser that
this Agreement is executed by The Bank of New York Mellon Trust Company, N.A.
(“BNYMTC”) on behalf of the Issuer not in its corporate and individual capacity
but solely as the Trustee under the Trust Agreement in the exercise of the power
and authority conferred and vested in it as the Trustee in the Trust Agreement.
It is further understood and agreed that BNYMTC shall not be personally liable
for any breach of any representation, warranty, covenant or agreement of the
Trustee or the Issuer contained herein, in the Notes or in any of the
certificates or other documents delivered hereunder and nothing herein contained
shall be construed as creating any liability on BNYMTC in its corporate and
individual capacity to make any payment or to perform any covenant, agreement or
undertaking contained herein, all such liability being expressly waived by the
Company and each Purchaser, and that the Company and each Purchaser shall look
solely to the properties and assets of the Issuer for payment of any amounts due
and payable on account of the Notes and for the payment, performance, or other
satisfaction of this Agreement and any claim against the Trustee by reason of
the transactions contemplated hereby.
 
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Rio Grande Resources Trust II
Note Purchase Agreement

 
If you are in agreement with the foregoing, please sign the form of agreement on
a counterpart of this Agreement and return it to the Company, whereupon this
Agreement shall become a binding agreement between you, the Company and the
Issuer.
 

 
Very truly yours,
       
RIO GRANDE RESOURCES TRUST II
       
By:  THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee as successor to
JPMorgan Chase Bank, N.A.) and not in its individual capacity
       
By:
/s/ Karen Yu
 
Name:
Karen Yu
 
Title:
Vice President
       
EL PASO ELECTRIC COMPANY
       
By:
/s/ Nathan T. Hirschi
 
Name:
Nathan T. Hirschi
 
Title:
Senior Vice President and Chief
   
Financial Officer

 

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Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

 
The Northwestern Mutual Life Insurance Company
        By:  Northwestern Mutual Investment Management Company, LLC Its
investment advisor         By:
/s/ David A. Barras
 
Name:
David A. Barras
 
Title:
Managing Director
         
The Northwestern Mutual Life Insurance Company, for its Group Annuity Separate
Account
        By:
/s/ David A. Barras
 
Name:
David A. Barras
 
 
Its Authorized Representative

 

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

 
State Farm Life Insurance Company
     
By:
/s/ Julie Hoyer
 
Name:
Julie Hoyer
 
Title:
Investment Executive
       
By:
/s/ Rebekah L. Holt
 
Name:
Rebekah L. Holt
 
Title:
Investment Professional
       
State Farm Insurance Companies Employee Retirement Trust
       
By:
/s/ Julie Hoyer
 
Name:
Julie Hoyer
 
Title:
Investment Executive
       
By:
/s/ Rebekah L. Holt
 
Name:
Rebekah L. Holt
 
Title:
Investment Professional

 

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

 
Great-West Life & Annuity Insurance Company
       
By:
/s/ Ward Argust
 
Name:
Ward Argust
 
Title:
Assistant Vice President, Investments

 

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

 
CoBank, ACB
       
By:
/s/ C. Brock Taylor
 
Name:
C. Brock Taylor
 
Title:
Vice President

 

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

 
American Equity Investment Life Insurance Company
       
By:
/s/ Jeffrey A. Fossell
 
Name:
Jeffrey A. Fossell
 
Title:
Authorized Signatory

 

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

   
The Guardian Life Insurance Company of America
       
By:
/s/ Edward Brennan
 
Name:
Edward Brennan
 
Title:
Senior Director

 

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
This Agreement is hereby
accepted and agreed to
as of the date thereof.
 

 
CMFG Life Insurance Company
       
By:  MEMBERS Capital Advisors, Inc. acting as Investment Advisor
       
By:
/s/ Allen R. Cantrell
 
Name:
Allen R. Cantrell
 
Title:
Managing Director, Investments

 

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Rio Grande Resources Trust II
Note Purchase Agreement

 
SCHEDULE B
DEFINED TERMS
 
As used herein, the following terms have the respective meanings set forth below
or set forth in the Section hereof following such term:
 
“Affiliate” means, at any time, and with respect to any Person, any other Person
that at such time directly or indirectly through one or more intermediaries
Controls, or is Controlled by, or is under common Control with, such first
Person, and, with respect to the Company, shall include any Person beneficially
owning or holding, directly or indirectly, 10% or more of any class of voting or
equity interests of the Company or its Subsidiaries or any corporation of which
the Company and its Subsidiaries beneficially own or hold, in the aggregate,
directly or indirectly, 10% or more of any class of voting or equity interests.
As used in this definition, “Control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. Unless the context otherwise clearly requires, any
reference to an “Affiliate” is a reference to an Affiliate of the Company.
 
“Anti-Corruption Laws” means any law or regulation in a U.S. or any non-U.S.
jurisdiction regarding bribery or any other corrupt activity, including the U.S.
Foreign Corrupt Practices Act and the U.K. Bribery Act 2010.
 
“Anti-Money Laundering Laws” means any law or regulation in a U.S. or any
non-U.S. jurisdiction regarding money laundering, drug trafficking,
terrorist-related activities or other money laundering predicate crimes,
including the Currency and Foreign Transactions Reporting Act of 1970 (otherwise
known as the Bank Secrecy Act) and the USA PATRIOT Act.
 
“Blocked Person” means (a) a Person whose name appears on the list of Specially
Designated Nationals and Blocked Persons published by OFAC, (b) a Person,
entity, organization, country or regime that is blocked or a target of sanctions
that have been imposed under U.S. Economic Sanctions Laws or (c) a Person that
is an agent, department or instrumentality of, or is otherwise beneficially
owned by, controlled by or acting on behalf of, directly or indirectly, any
Person, entity, organization, country or regime described in clause (a) or (b).
 
“Business Day” means 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.
 
“Capital Lease Obligations” of any person means the obligations of such person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.
 
Schedule B-1

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Rio Grande Resources Trust II
Note Purchase Agreement

 
“Change of Control” means (a) an event or series of events by which any “person”
or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Exchange
Act) (other than one or more Permitted Holders) becomes the “beneficial owner”
(as defined in Rule 13d‑3 under the Exchange Act), directly or indirectly, of
more than 50% of the voting power of the then outstanding Voting Stock of the
Company or (b) a majority of the members of the Board of Directors of the
Company are not Continuing Directors; provided, however, that a “Change of
Control” shall not be deemed to have occurred as a result of the formation of a
holding company for the Company or its businesses as part of any transaction
(merger, consolidation, plan of exchange, etc.) in which such holding company is
owned, following the transaction, by the former holders of the Company’s Voting
Stock in substantially the same proportions as their ownership of the Company’s
Voting Stock immediately prior to such transaction.
 
“Closing” is defined in Section 3.
 
“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time.
 
“Company” means El Paso Electric Company, a Texas corporation.
 
“Confidential Information” is defined in Section 21.
 
“Continuing Directors” means as of any date of determination, any member of the
board of directors of the Company who (i) was a member of such board of
directors on the date of this Agreement or (ii) was nominated for election or
elected to such board of directors with the approval of a majority of Continuing
Directors who were members of such board at the time of such nomination or
election.
 
“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or otherwise; and the
terms “Controlled” and “Controlling” shall have meanings correlative to the
foregoing.
 
“Controlled Entity” means (a) any of the Subsidiaries of the Company and any of
their or the Company’s respective Controlled Affiliates and (b) if the Company
has a parent company, such parent company and its Controlled Affiliates.
 
“Credit Agreement” means the Second Amended and Restated Credit Agreement dated
as of January 14, 2014 among the Company, The Bank of New York Trust Company,
National Association, as trustee of the Rio Grande Resources Trust II, the
lenders party thereto and JPMorgan Chase Bank, National Association as
Administrative Agent and Issuing Bank, as amended and supplemented by that
Extension and Increase Confirmation, dated as of January 9, 2017, by and among
the Company, The Bank of New York Mellon Trust Company, N.A., not in its
individual capacity, but solely in its capacity as successor trustee of the Rio
Grande Resources Trust II, as such agreement may be further amended, restated,
supplemented, modified or extended, and any successor, substitute, or
replacement thereto.
 
Schedule B-2

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Rio Grande Resources Trust II
Note Purchase Agreement

 
“Default” means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.
 
“Default Rate” means that rate of interest that is the greater of (i) 2% per
annum above the rate of interest stated in clause (a) of the first paragraph of
the Notes or (ii) 2% over the rate of interest publicly announced by JPMorgan
Chase Bank, National Association as its “base” or “prime” rate.
 
“Disclosure Documents” is defined in Section 5.3.
 
“Domestic Subsidiary” means any Subsidiary that is incorporated or organized
under the laws of the United States of America, any State thereof or the
District of Columbia.

“Electronic Delivery” means (i) for reports, registration statements and other
documents required to be filed with the SEC, the filing and availability thereof
on “EDGAR” and the availability thereof on the Company’s home page on the
worldwide web (at the date of this Agreement located at: 
http//www.epelectric.com) and (ii) for any documents not required to be filed
with the SEC, the availability thereof on the Company’s home page on the
worldwide web, and in the case of this clause (ii), the prior notice by the
Company to each holder of Notes of such availability, with such notice
containing either (y) an attachment of such reports, registration statements or
other documents or (z) a link to the site on the worldwide web containing such
documents.
 
“Environmental Laws” means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
Hazardous Materials.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the rules and regulations promulgated thereunder from
time to time in effect.
 
“ERISA Affiliate” means any trade or business (whether or not incorporated) that
is treated as a single employer together with the Company under section 414 of
the Code.
 
“Event of Default” is defined in Section 11.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Excepted Assets” means all bills, notes and other instruments, accounts
receivable, claims, credits, judgments, demands, general intangibles, licenses
and privileges (except franchises and permits), emissions allowances, choses in
action, patents, patent applications, patent licenses and other patent rights,
trade names, trademarks and all contracts, leases and agreements of whatsoever
kind and nature, other than any of the foregoing which are by the express
provisions of the Mortgage Indenture subjected or required to be subjected to
the lien of the Mortgage Indenture.
 
“FATCA” means (a) sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), together with any current or
future regulations or official interpretations thereof, (b) any treaty, law or
regulation of any other jurisdiction, or relating to an intergovernmental
agreement between the United States of America and any other jurisdiction, which
(in either case) facilitates the implementation of the foregoing clause (a), and
(c) any agreements entered into pursuant to section 1471(b)(1) of the Code.
 
Schedule B-3

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
“FERC” means the Federal Energy Regulatory Commission, or any Governmental
Authority succeeding to any or all of such commission’s authority.
 
“Finsub” means a special purpose corporation organized under the laws of a State
of the United States of America formed solely for the purpose of engaging in the
Receivables Program.
 
“First Mortgage Bonds” means any series of First Mortgage Bonds of the Company
issued pursuant to a Mortgage Indenture.
 
“Form 10-K” is defined in Section 7.1(b).
 
“Form 10-Q” is defined in Section 7.1(a).
 
“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States of America.
 
“Governmental Authority” means
 
(a)          the government of
 
(i)          the United States of America or any state or other political
subdivision thereof, or
 
(ii)         any jurisdiction in which the Issuer, the Company or its
Subsidiaries conducts all or any part of its business, or which asserts
jurisdiction over any properties of the Company or its Subsidiaries, or
 
(b)          any entity exercising executive, legislative, judicial, regulatory
or administrative functions of, or pertaining to, any such government.
 
“Governmental Official” means any governmental official or employee, employee of
any government-owned or government-controlled entity, political party, any
official of a political party, candidate for political office, official of any
public international organization or anyone else acting in an official capacity.
 
“Guarantee” of or by any person means any obligation, contingent or otherwise,
of such person guaranteeing or having the economic effect of guaranteeing any
Indebtedness of any other person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such person, direct or
indirect, (a) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or to purchase (or to advance or supply funds for
the purchase of) any security for the payment of such Indebtedness, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness of the payment of such Indebtedness or (c) to
maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness; provided, however, that the term Guarantee
shall not include endorsements for collection or deposit in the ordinary course
of business.
 
Schedule B-4

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
“Guaranteed Party” is defined in Section 13.
 
“Hazardous Material” means any and all pollutants, toxic or hazardous wastes or
other substances that might pose a hazard to health and safety, the removal of
which may be required or the generation, manufacture, refining, production,
processing, treatment, storage, handling, transportation, transfer, use,
disposal, release, discharge, spillage, seepage or filtration of which is or
shall be restricted, prohibited or penalized by any applicable law including,
but not limited to, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar
restricted, prohibited or penalized substances.
 
“holder” means, with respect to any Note, the Person in whose name such Note is
registered in the register maintained by the Company as agent for the Issuer
pursuant to Section 14.1.
 
“Indebtedness” of any Person shall mean, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property or assets purchased by such Person, (e) all obligations of such Person
issued or assumed as the deferred purchase price of property or services
(excluding trade accounts payable and accrued obligations incurred in the
ordinary course of business), (f) all Indebtedness of others secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property owned or acquired by such
Person, whether or not the obligations secured thereby have been assumed, (g)
all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease
Obligations of such Person, (i) all obligations of such Person in respect of
interest rate protection agreements, foreign currency exchange agreements or
other interest or exchange rate hedging arrangements, (j) the principal
component of all obligations of such Person as an account party in respect of
letters of credit (other than any letter of credit in respect of which a
back-to-back letter of credit has been issued, provided that the commercial bank
issuing such back- to-back letter of credit has a long-term senior unsecured
debt rating of not less than A- by S&P and not less than A3 by Moody’s) and (k)
the principal component of all obligations of such Person as an account party in
respect of bankers’ acceptances. The Indebtedness of any Person shall include
the Indebtedness of any partnership in which such Person is a general partner,
other than to the extent that the instrument or agreement evidencing such
Indebtedness expressly limits the liability of such Person in respect thereof.
 
“Institutional Accredited Investor” means any Person that is an “accredited
investor” as such term is defined under Rule 501(a)(1), (2), (3) or (7)
promulgated under the Securities Act.
 
Schedule B-5

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Rio Grande Resources Trust II
Note Purchase Agreement

 
“Issuer” means Rio Grande Resources Trust II, a grantor trust organized and
existing pursuant to the Trust Agreement.
 
“Lien” means, with respect to any Person, any mortgage, lien, pledge, charge,
security interest or other encumbrance, or any interest or title of any vendor,
lessor, lender or other secured party to or of such Person under any conditional
sale or other title retention agreement or Capital Lease Obligation, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).
 
“Make-Whole Amount” is defined in Section 8.7.
 
“Material” means material in relation to the business, operations, affairs,
financial condition, assets, properties of the Company and its Subsidiaries
taken as a whole.
 
“Material Adverse Effect” means a material adverse effect on (a) the business,
operations, financial condition, assets or properties of the Company and its
Subsidiaries taken as a whole, (b) the ability of the Company or the Issuer to
perform its obligations under this Agreement and the Notes, (c) the ability of
any Subsidiary Guarantor to perform its obligations under its Subsidiary
Guaranty, or (d) the validity or enforceability of this Agreement, the Notes or
any Subsidiary Guaranty.
 
“Material Credit Facility” means, as to the Company and its Subsidiaries,
 
(a)           the Credit Agreement, including any renewals, extensions,
amendments, supplements, restatements, replacements or refinancing thereof; and
 
(b)           any other bank or asset-based credit facilities (whether providing
for revolving, letter of credit or term extensions of credit) that provide for
extensions of credit or commitments therefor in an aggregate amount equal to or
greater than $100,000,000 (or the equivalent of such amount in the relevant
currency of payment, determined as of the date of the closing of such facility
based on the exchange rate of such other currency on such date) and in respect
of which the Company or any of its Subsidiaries is obligated on Indebtedness
(excluding, for the avoidance of doubt, any Mortgage Indenture securing First
Mortgage Bonds) (“Credit Facility”); and if no Credit Facility or Credit
Facilities equal or exceed such amounts, then the largest Credit Facility shall
be deemed to be a Material Credit Facility.
 
“Material Subsidiary” means, at any time, (a) a Domestic Subsidiary of the
Company (other than a Receivables Subsidiary) with consolidated total assets at
such time equal to or greater than 10% of the Company’s consolidated total
assets at such time or (b) any other Subsidiary which becomes a Subsidiary
Guarantor.
 
“Memorandum” is defined in Section 5.3.
 
“Moody’s” means Moody’s Investors Service, Inc., and its successors.
 
Schedule B-6

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Rio Grande Resources Trust II
Note Purchase Agreement

 
“Mortgage Indenture” means any indenture (including without limitation any
indenture entered into by the Company following the date hereof) secured by a
mortgage Lien upon the Company’s Operating Property.
 
“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term
is defined in section 4001(a)(3) of ERISA).
 
“NAIC” means the National Association of Insurance Commissioners or any
successor thereto.
 
“NMPRC” is defined in Section 5.7.
 
“Notes” is defined in Section 1.
 
“Nuclear Fuel” has the meaning assigned to such term in the Purchase Contract.

“Obligations” is defined in Section 13.1.
 
“OFAC” means the Office of Foreign Assets Control of the United States
Department of the Treasury.
 
“OFAC Sanctions Program” means any economic or trade sanction that OFAC is
responsible for administering and enforcing. A list of OFAC Sanctions Programs
may be found at
http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx.
 
“Officer’s Certificate” means a certificate of a Senior Financial Officer or of
any other officer of the Company whose responsibilities extend to the subject
matter of such certificate.
 
“Operating Property” mean, as of any date, (a) all of the real, personal and
mixed property which is an integral part of or is used or to be used as an
integral part of the electric generating, transmission and/or distribution
operations of the Company, (b) any undivided legal interest of the Company in
any such property which is jointly owned by the Company and any other Person or
Persons and (c) franchises and permits owned by the Company in connection with
the electric generating, transmission and/or distribution operations of the
Company, including, without limitation, all of such property which is acquired
by the Company after the Closing; provided, however, that Operating Property
shall not be deemed to include any Operating Property excepted under a Mortgage
Indenture.
 
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA or any successor thereto.
 
“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, business entity or
Governmental Authority.
 
“Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA)
subject to Title I of ERISA that is or, within the preceding five years, has
been established or maintained, or to which contributions are or, within the
preceding five years, have been made or required to be made, by the Company or
any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate
may have any liability.
 
Schedule B-7

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
“property” or “properties” means, unless otherwise specifically limited, real or
personal property of any kind, tangible or intangible, choate or inchoate.
 
“Purchase Contract” means the Purchase Contract dated as of February 12, 1996,
as amended as of February 11, 1999, between the Trustee and the Company, as the
same may be further amended, supplemented or otherwise modified from time to
time in accordance with the provisions thereof and hereof.
 
“Purchaser” means each of the purchasers that has executed and delivered this
Agreement to the Issuer and the Company and such Purchaser’s successors and
assigns permitted by this Agreement (so long as any such assignment complies
with Section 14.2), provided, however, that any Purchaser of a Note that ceases
to be the registered holder or a beneficial owner (through a nominee) of such
Note as the result of a transfer thereof pursuant to Section 14.2 shall cease to
be included within the meaning of “Purchaser” of such Note for the purposes of
this Agreement upon such transfer.
 
“Rating Decline” means (i) a decrease to less than “investment grade” (currently
BBB- and Baa3) in the rating of the Company’s unsecured debt (or its secured
debt that is the equivalent of the Notes if they are secured at such time) by
either Moody’s or S&P or (ii) a withdrawal of such rating by either Moody’s or
S&P; provided, however, that such decrease or withdrawal occurs on, or within 30
days following, the date of public notice of the occurrence of a Change of
Control.
 
“Receivables” has the meaning assigned to such term in the definition of
“Receivables Program.”
 
“Receivables Program” means, collectively, (a) the sale of, or transfer of
interests in, account receivables and related contract rights (“Receivables”) of
the Company to Finsub and (b) the transfer of such Receivables by Finsub to a
special purpose trust or corporation which is not an Affiliate of the Company or
Finsub; provided, that all terms and conditions of, and all documentation
relating to, the Receivables Program shall be (i) in form and substance
customary to a comparable Receivables Program and (ii) non-recourse to the
Company other than pursuant to customary representations, warranties, covenants
and indemnities entered into in connection with a Receivables Program.
 
“Receivables Program Documents” means all agreements, in form and substance
customary to a Receivables Program, that may from time to time be entered into
by the Company or a Subsidiary in connection with any Receivables Program, as
such agreements may be amended, supplemented or otherwise modified from time to
time in accordance with the provisions thereof and hereof.
 
“Receivables Subsidiary” means a wholly-owned Domestic Subsidiary of the Company
formed solely for the purpose of engaging in a Receivables Program and which
acts as a purchaser of Receivables under a Receivables Program.
 
Schedule B-8

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
“Required Holders” means, at any time, the holders of at least 51% in principal
amount of the Notes at the time outstanding (exclusive of Notes then owned by
the Issuer or any of its Affiliates).
 
“Responsible Officer” means any Senior Financial Officer and any other officer
of the Company with responsibility for the administration of the relevant
portion of this Agreement.
 
“SEC” means the Securities and Exchange Commission of the United States, or any
successor thereto.
 
“Securities” or “Security” shall have the meaning specified in section 2(1) of
the Securities Act.
 
“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
 
“Senior Financial Officer” means the chief financial officer, principal
accounting officer, treasurer or controller of the Company.
 
 “S&P” means Standard & Poor’s Ratings Group, and its successors.
 
“State Sanctions List” means a list that is adopted by any state Governmental
Authority within the United States of America pertaining to Persons that engage
in investment or other commercial activities in Iran or any other country that
is a target of economic sanctions imposed under U.S. Economic Sanctions Laws.
 
“Stockholders’ Equity” means, as at any date of determination, the stockholders’
equity at such date of the Company, as determined in accordance with GAAP.
 
“Subsidiary” means, as to any Person, any other Person in which such first
Person or one or more of its Subsidiaries or such first Person and one or more
of its Subsidiaries owns sufficient equity or voting interests to enable it or
them (as a group) ordinarily, in the absence of contingencies, to elect a
majority of the directors (or Persons performing similar functions) of such
second Person, and any partnership or joint venture if more than a 50% interest
in the profits or capital thereof is owned by such first Person or one or more
of its Subsidiaries or such first Person and one or more of its Subsidiaries
(unless such partnership can and does ordinarily take major business actions
without the prior approval of such Person or one or more of its Subsidiaries).
Unless the context otherwise clearly requires, any reference to a “Subsidiary”
is a reference to a Subsidiary of the Company.
 
“Subsidiary Guarantor” means each Subsidiary that has executed and delivered a
Subsidiary Guaranty.
 
“Subsidiary Guaranty” is defined in Section 9.7(a).
 
“SVO” means the Securities Valuation Office of the NAIC or any successor to such
Office.
 
Schedule B-9

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
“this Agreement” or “the Agreement” is defined in Section 18.3.
 
“Total Consolidated Capital” means as at any date of determination, the sum of
Total Consolidated Debt on such date and Stockholders’ Equity at such date.
 
“Total Consolidated Debt” means, as of any date of determination, all
Indebtedness (other than (a) Indebtedness of the type referred to in clause (i)
of the definition of the term “Indebtedness”, (b) Indebtedness of the type
referred to in clause (j) of the definition of the term “Indebtedness”, except
to the extent of unreimbursed drawings thereunder, and (c) Indebtedness of the
type referred to in clause (k) of the definition of the term “Indebtedness”) of
Company at such date.
 
“Trust Agreement” means the Trust Agreement dated as of February 12, 1996,
between the Trustee and the Company, providing for the creation of the Rio
Grande Resources Trust II, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the provisions thereof and hereof.
 
“Trustee” means The Bank of New York Mellon Trust Company, N.A., not in its
individual capacity, but solely in its capacity as trustee of the Rio Grande
Resources Trust II (as successor to JPMorgan Chase Bank, N.A., in such
capacity).
 
“United States Person” has the meaning set forth in Section 7701(a)(30) of the
Code.
 
“USA Patriot Act” means United States Public Law 107-56, Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
 
“U.S. Economic Sanctions Laws” means those laws, executive orders, enabling
legislation or regulations administered and enforced by the United States
pursuant to which economic sanctions have been imposed on any Person, entity,
organization, country or regime, including the Trading with the Enemy Act, the
International Emergency Economic Powers Act, the Iran Sanctions Act, the Sudan
Accountability and Divestment Act and any other OFAC Sanctions Program.
 
“Voting Stock” means stock having the voting power for the election of
directors, trustees, general partners or managers, as the case may be, whether
at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.
 
“Wholly-Owned Subsidiary” means, at any time, any Subsidiary all of the equity
interests (except directors’ qualifying shares) and voting interests of which
are owned by any one or more of the Company and the Company’s other Wholly-Owned
Subsidiaries at such time.
 
Schedule B-10

--------------------------------------------------------------------------------

Rio Grande Resources Trust II
Note Purchase Agreement

 
EXHIBIT 1

FORM OF NOTE
 
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
“SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY OTHER STATE OR OTHER
JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THIS SECURITY MAY ONLY BE
TRANSFERRED TO AN “INSTITUTIONAL ACCREDITED INVESTOR” IN ACCORDANCE WITH THE
TERMS OF THE NOTE PURCHASE AGREEMENT DATED AS OF JUNE 28, 2018.
 
RIO GRANDE RESOURCES TRUST II
 
 
4.07% Senior Guaranteed Note Due August 15, 2025

No. [_____]
[Date]
$[_______]
PPN[______________]

 
FOR VALUE RECEIVED, the undersigned, the Rio Grande Resources Trust II (the
“Issuer”), promises to pay to [         ], or registered assigns, the principal
sum of $[              ] on August 15, 2025, with interest (computed on the
basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance
thereof at the rate of 4.07% per annum from the date hereof, payable
semiannually, on February 15 and August 15 in each year, commencing with the
February 15 or August 15 next succeeding the date hereof (provided, that the
first interest payment shall be made on February 15, 2019), until the principal
hereof shall have become due and payable, and (b) to the extent permitted by
law, at a rate per annum from time to time equal to the greater of (i) 6.07% or
(ii) 2% over the rate of interest publicly announced by JPMorgan Chase Bank,
National Association from time to time in New York, New York as its “base” or
“prime” rate, on any overdue payment of interest and, during the continuance of
an Event of Default, on the unpaid balance hereof and on any overdue payment of
any Make-Whole Amount, payable semiannually as aforesaid (or, at the option of
the registered holder hereof, on demand), but in each case in no event in excess
of the maximum nonusurious rate of interest permitted under applicable law.
 
Payments of principal of, interest on and any Make-Whole Amount with respect to
this Note are to be made in lawful money of the United States of America at the
principal office of The Bank of New York Mellon in New York, New York or at such
other place as the Issuer shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
 
Exhibit 1-1

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Rio Grande Resources Trust II
Note Purchase Agreement

 
This Note is one of a series of Senior Guaranteed Notes (herein called the
“Notes”) issued pursuant to the Note Purchase Agreement dated as of June 28,
2018 (as from time to time amended, the “Note Purchase Agreement”), between the
Issuer, El Paso Electric Company and the respective Purchasers named therein and
is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, (i) to have agreed to the confidentiality provisions set
forth in Section 21 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6 of the Note Purchase Agreement. Unless
otherwise indicated, capitalized terms used in this Note shall have the
respective meanings ascribed to such terms in the Note Purchase Agreement.
 
This Note is a registered Note and, as provided in the Note Purchase Agreement,
upon surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder’s attorney duly authorized in writing, a new Note
for a like principal amount will be issued to, and registered in the name of,
the transferee. Prior to due presentment for registration of transfer, the
Issuer 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
Issuer will not be affected by any notice to the contrary.
 
This Note is subject to optional prepayment, in whole or from time to time in
part, at the times and on the terms specified in the Note Purchase Agreement,
but not otherwise.
 
If an Event of Default occurs and is continuing, the principal of this Note may
be declared or otherwise become due and payable in the manner, at the price
(including any applicable Make-Whole Amount) and with the effect provided in the
Note Purchase Agreement.
 
This Note shall be construed and enforced in accordance with, and the rights of
the parties shall be governed by, the law of the state of New York excluding
choice-of-law principles of the law of such state that would require the
application of the laws of a jurisdiction other than such state.
 

 
RIO GRANDE RESOURCES TRUST II
       
By: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee (as successor to
JPMorgan Chase Bank, N.A.) and not in its individual capacity
       
By:
     
Name:
   
Title:
 

 
Exhibit 1-2

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EXHIBIT 4.4(a)

FORM OF OPINION OF COUNSEL
FOR THE COMPANY
 
001468.0118
 
June 28, 2018
 
To the Purchasers listed on
Schedule A to the
Agreement referred to below
 
RIO GRANDE RESOURCES TRUST II
(El Paso Electric Company (Guarantor))
4.07% Senior Guaranteed Notes due 2025
Ladies and Gentlemen:
 
This letter is being furnished to you pursuant to Section 4.4(a) of the Note
Purchase Agreement dated as of June 28, 2018 (the “Agreement”) among El Paso
Electric Company, a Texas corporation (the “Company”), the Rio Grande Resources
Trust II, a trust formed under the laws of the State of Texas (the “Issuer”),
and you, relating to the issuance and sale by the Issuer to you of $65,000,000
aggregate principal amount of the Issuer’s 4.07% Senior Guaranteed Notes due
August 15, 2025 (the “Notes”). The Notes will be guaranteed by the Company as
provided in the Agreement (the “Guarantee” and, together with the Notes, the
“Securities”).  Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Agreement.
 
In connection with the offer and sale of the Securities to you, we have reviewed
originals or copies of the following:
 

(i)
the Agreement;

 

(ii)
the Securities;

 

(iii)
documents relating to the Company delivered by the Company, including the
Amended and Restated Articles of Incorporation of the Company and the Amended
and Restated Bylaws of the Company, each as amended to date;

 

(iv)
documents relating to the Issuer delivered by the Company, including the Trust
Agreement, the Purchase Contract, the Assignment Agreement (the “Assignment
Agreement”) dated as of February 12, 1996 by and between the Company and the
Trustee, solely in its capacity as trustee of the Issuer, and the Supplemental
Instructions Pursuant to the Trust Agreement dated June 28, 2018, each as
amended to date;

 

(v)
corporate records of the Company, including minute books, as furnished to us by
the Company;

 
Exhibit 4.4(a)-1

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(vi)
records of the Issuer, including Supplemental Instructions Pursuant to the Trust
Agreement, as furnished to us by the Company;

 

(vii)
certificates of public officials and officers or other representatives of the
Company; and

 

(viii)
statutes and such other instruments and documents as we have deemed necessary or
advisable for purposes of the opinions hereinafter expressed.

 
In giving the opinions set forth below, we have relied, to the extent we deemed
appropriate, without independent investigation or verification, upon the
certificates, statements or other representations of officers or other
representatives of the Company, the Issuer and of governmental and public
officials with respect to the accuracy and completeness of the factual matters
contained in or covered by such certificates, statements or representations. In
making our examination, we have assumed that all signatures on documents
examined by us are genuine, all documents submitted to us as originals are
authentic and complete, and all documents submitted to us as copies are true and
correct copies of the originals of such documents.
 
Further, in rendering the opinions expressed below, we have assumed with your
permission and without independent verification or inquiry that each of the
documents listed above executed by parties other than the Company and the Issuer
have been duly authorized, executed and delivered by, and constitute the valid
and legally binding obligation of such party thereto, enforceable against each
such party in accordance with its terms and that all such other parties are duly
organized and validly existing and have the requisite power and authority to
execute and deliver such documents and to perform their obligations thereunder.
Moreover, in rendering the opinions expressed below, we have assumed with your
permission and without independent verification or inquiry that (i) no laws,
rules or regulations, and no judicial, administrative or other action of any
governmental authority, not expressly opined to herein would adversely affect
the opinions set forth herein, and (ii) that the Trustee is not in default and
no event has occurred which, with the passage of time, giving of notice, or
both, would constitute a default by the Trustee of its obligations under the
terms and provisions of the Trust Agreement, the Purchase Contract or the
Assignment Agreement, each as amended to date.
 
On the basis of the foregoing, and subject to the exceptions, limitations,
qualifications and assumptions set forth herein, we are of the opinion that:
 
1.             The Company has the corporate power and authority to issue the
Guarantee, to enter into the Agreement and to perform its obligations
thereunder.
 
2.             The Issuer has the trust power and authority to issue the Notes,
to enter into the Agreement and to perform its obligations thereunder.
 
3.             The Agreement has been duly authorized by all necessary corporate
or other action on the part of each of the Company and the Issuer, has been duly
executed and delivered by each of the Company and the Issuer and constitutes the
valid and legally binding obligation of each of the Company and the Issuer,
enforceable against the Company and the Issuer in accordance with its terms,
subject, as to enforcement, to (a) applicable bankruptcy, insolvency,
reorganization, arrangement, fraudulent transfer or conveyance, moratorium,
conservatorship and similar laws affecting creditors’ rights and remedies
generally, (b) general principles of equity (whether considered in a proceeding
in equity or at law), including, without limitation, the possible unavailability
of specific performance, injunctive relief or any other equitable remedy, and
(c) principles of materiality and reasonableness and implied covenants of good
faith and fair dealing.
 
Exhibit 4.4(a)-2

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4.             The Securities have been duly authorized by all necessary
corporate or other action on the part of each of the Company and the Issuer and
have been duly executed and delivered by each of the Company and the Issuer and,
when authenticated in accordance with the terms of the Agreement and delivered
to and paid for by the Purchasers in accordance with the terms of the Agreement,
will constitute valid and legally binding obligations of the Company and the
Issuer, enforceable against the Company and the Issuer in accordance with their
terms, subject, as to enforcement, to (a) applicable bankruptcy, insolvency,
reorganization, arrangement, fraudulent transfer or conveyance, moratorium,
conservatorship and similar laws affecting creditors’ rights and remedies
generally, (b) general principles of equity (whether considered in a proceeding
in equity or at law), including, without limitation, the possible unavailability
of specific performance, injunctive relief or any other equitable remedy, and
(c) principles of materiality and reasonableness and implied covenants of good
faith and fair dealing.
 
5.             The issuance and sale of the Securities to the Purchasers
pursuant to the Agreement do not, and the execution and delivery of the
Securities and the Agreement by each of the Company and the Issuer and the
performance by each of the Company and the Issuer of their respective
obligations under the Securities and the Agreement (collectively, the
“Documents”) on the date hereof will not, (i) contravene any provision of the
Amended and Restated Articles of Incorporation or Amended and Restated Bylaws of
the Company or the Trust Agreement, each as amended to date, or (ii) contravene
any provision of Applicable Law (except for such contraventions that would not
reasonably be expected, either individually or in the aggregate, to have a
Material Adverse Effect).  “Applicable Law” means the laws of the State of
Texas, the laws of the State of New York and the federal laws of the United
States of America that in our experience is normally applicable to general
business corporations and grantor trusts in relation to transactions of the type
contemplated by the Documents, provided that we express no opinion as to federal
or state securities (except as set forth in paragraph 8 below) or Blue Sky laws,
antifraud laws, the rules of the Financial Industry Regulatory Authority, Inc.
(“FINRA”), the Public Utility Holding Company Act of 2005, as amended (“PUHCA”),
or any related laws, rules or regulations or the Federal Power Act or any other
laws, rules or regulations promulgated by or within the enforcement authority of
the Federal Energy Regulatory Commission (“FERC”) or the Nuclear Regulatory
Commission (“NRC”).
 
6.             Neither the Company nor the Issuer is, and after giving effect to
the issuance and sale of the Securities and the application of the net proceeds
thereof as contemplated by the Agreement, neither will be, required to register
as an “investment company” as such term is defined in the Investment Company Act
of 1940, as amended.
 
Exhibit 4.4(a)-3

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7.             No consent, approval, authorization or order of, or qualification
with, any United States federal, or any Texas or New York state court,
governmental, regulatory or administrative agency or commission or other
governmental authority or instrumentality is required under Applicable Law for
the execution and delivery of the Agreement by the Company or the Issuer, the
issuance and sale of the Securities to the Purchasers pursuant to the Agreement
or for the performance by the Company or the Issuer of their respective
obligations under the Documents on the date hereof, except such as (i) may be
required by FINRA or the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Securities, the PUHCA, the Federal
Power Act or any other laws, rules or regulations promulgated by or within the
enforcement authority of the FERC or the NRC, as to which we express no opinion
(except as set forth in paragraph 8 below), or (ii) have already been obtained
or made; provided, however, that the Public Utility Commission of Texas (“PUCT”)
rules require that each electric utility subject to reporting requirements of
the SEC file three copies of each required report (including Form 10-Ks, Form
10-Qs, Form 8-Ks, annual reports and registration statements) with the PUCT no
later than fifteen days from the initial filing date with the SEC.
 
8.             No registration under the Securities Act of 1933, as amended, of
the Securities is required in connection with the offer, sale and delivery of
the Securities to the Purchasers as contemplated by the Agreement, and no
indenture is required to be qualified under the Trust Indenture Act of 1939, as
amended, in each case assuming the accuracy of, and compliance with, the
representations, warranties and covenants of the Company, the Issuer and the
Purchasers in the Agreement, it being understood that no opinion is expressed as
to any subsequent offer or resale of the Securities.
 
9.             The borrowings under the Agreement and the application of the net
proceeds thereof as contemplated by the Agreement do not violate Regulation U or
X of the Board of Governors of the Federal Reserve System as in effect on the
date hereof, assuming that the Company and the Issuer comply with the provisions
of the Agreement relating to the use of net proceeds and based upon the
representations and warranties in Section 5.14 of the Agreement.
 
The opinions set forth above are limited in all respects to matters of
Applicable Law, in each case as published and in effect on the date hereof, and
we express no opinion as to the law of any other jurisdiction, the PUHCA or any
related laws, rules or regulations or the Federal Power Act or any other laws,
rules or regulations promulgated by or within the enforcement authority of the
FERC or the NRC or any other law, rule or regulation that is applicable to the
Company or the Issuer, the Documents or the transactions contemplated thereby
solely because such law, rule or regulation is part of a regulatory regime
applicable to any party to any of the Documents or any of its affiliates due to
the specific assets or business of such party or such affiliate.
 
Exhibit 4.4(a)-4

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This letter is being furnished only to you, the Purchasers, solely for your
benefit, exclusively for use in connection with the transactions contemplated
under the Agreement, and is not to be used, quoted, relied upon or otherwise
referred to by any other person or for any other purposes without our prior
written consent, except that our prior written consent is not needed to furnish
a copy of this letter (with no right of reliance): (a) in connection with any
proceedings relating to the Agreement or the enforcement thereof; (b) to
accountants and counsel for the Purchasers; (c) to the National Association of
Insurance Commissioners or bank or other governmental regulatory examiners; (d)
to any rating agency rating any Purchaser; (e) pursuant to judicial process or
government order or requirement; and (f) to prospective permitted assignees of
any Purchaser under the Agreement. This letter may be provided, without our
prior consent (with right of reliance) to the transferees of Notes that are
Institutional Accredited Investors (the “Transferees”), in each case on the
condition and understanding that (i) this letter speaks only as of the date
hereof, (ii) we have no responsibility or obligation to update this letter to
consider its applicability or correctness to such Transferee, (iii) in no event
shall any Transferee have any greater rights with respect hereto than the
original addressees of this letter on the date hereof nor, in the case of any
Transferee that becomes a Transferee by assignment, any greater rights than its
assignor, (iv) in furtherance and not in limitation of the foregoing, our
consent to such reliance shall in no event constitute a reissuance of the
opinions expressed herein or otherwise extend any statute of limitations period
applicable hereto on the date hereof, and (v) any such reliance by any such
Transferee also must be actual and reasonable under the circumstances existing
at the time of its becoming a Transferee, including any changes in law or facts,
or any other developments or events known to or reasonably knowable by such
Transferee at such time. This letter speaks as of the date hereof, and we
undertake no, and hereby disclaim any, obligation or responsibility to update or
supplement this letter in response to changes in law or facts or the occurrence
of developments or events after the date hereof affecting any transaction
contemplated by the Agreement, or any opinion expressed herein.
 
Very truly yours,
 
Exhibit 4.4(a)-5

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EXHIBIT 4.4(b)

FORM OF OPINION OF INTERNAL COUNSEL
FOR THE COMPANY
 
To the Purchasers listed on
Schedule A to the
Agreement referred to below
 
Ladies and Gentlemen:
 
I have acted as General Counsel for El Paso Electric Company, a Texas
corporation (the “Company”), in connection with the Note Purchase Agreement
dated as of June 28, 2018 (the “Agreement”) among the Company, the Rio Grande
Resources Trust II (the “Issuer”) and you, under which you have severally agreed
to purchase from the Issuer $65,000,000 aggregate principal amount of the
Issuer’s 4.07% Senior Guaranteed Notes due August 15, 2025 (the “Notes”).  The
Notes will be guaranteed by the Company as Guarantor (the “Guarantee” and,
together with the Notes, the “Securities”).  I am issuing this opinion pursuant
to Section 4.4(b) of the Agreement.  Capitalized terms used but not otherwise
defined herein shall have the meanings assigned to such terms in the Agreement.
 
In connection with rendering the opinions expressed herein, I (or attorneys
under my supervision) have reviewed (1) the Agreement, (2) the Notes, (3) the
September 1, 2017 application filed by the Company with the Federal Energy
Regulatory Commission (“FERC”) in Docket No. ES17-54-000, for authorization
under Section 204 of the Federal Power Act, as amended (the “FPA”), to issue
long-term debt (the “204 Application”), (4) FERC’s delegated letter order dated
October 31, 2017 in El Paso Electric Co., 161 FERC ¶ 62,062 (2017) (the “204
Order”), (5) the September 1, 2015 application filed by the Company with the New
Mexico Public Regulation Commission (“NMPRC”) in Case No. 15-00280-UT, for
authorization to issue long-term debt by the Company and the Issuer, (6) NMPRC’s
Recommended Decision dated October 2, 2015 in Case No. 15-00280-UT and (7)
NMPRC’s Final Order Adopting Recommended Decision dated October 7, 2015 in Case
No. 15-00280-UT authorizing, among other things, the issuance and sale of the
Notes by the Issuer pursuant to the Agreement (the “2015 NMPRC Final Order”). 
In addition, I (or attorneys under my supervision) have reviewed such other
records, agreements, instruments, certificates of public officials and other
documents, and have made such other investigations, as I have deemed necessary
for the purpose of this opinion letter.
 
I have (i) relied as to factual matters on the representations and warranties
contained in the Agreement, and (ii) assumed (A) the authenticity of all
documents submitted to me as originals, (B) the genuineness of signatures or
original documents, and the conformity to the originals of all copies submitted
to me as photocopies or conformed copies, (C) the due authorization, execution
and delivery of the Agreement by each of the parties executing such documents
(other than the Company and the Issuer), (D) that the Agreement constitutes a
valid and binding agreement of the parties thereto (other than the Company and
the Issuer), and (E) the accuracy and completeness of the public records of the
regulatory agencies, boards and commissions on which I have relied.
 
Exhibit 4.4(b)-1

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I have assumed that all applicable laws and regulations have been duly enacted
and validly promulgated, that all regulatory agencies, boards and commissions
have been duly constituted, that all public officials and all members of said
agencies, boards and commissions have been duly appointed and are lawfully
holding the positions to which they have been elected or appointed, and that any
actions taken by them under delegated authority are undertaken pursuant to
properly delegated authority.
 
Based upon the foregoing, and subject to the qualifications set forth below, it
is my opinion that:
 

1.
The Company is validly existing as a corporation subsisting under the laws of
the State of Texas and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification (except where the
failure to so qualify would not have a Material Adverse Effect, as that term is
defined in the Agreement).

 

2.
The Issuer is validly existing as a trust subsisting under the laws of the State
of Texas and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification (except where the failure to so
qualify would not have a Material Adverse Effect, as that term is defined in the
Agreement).

 

3.
The execution and delivery by each of the Issuer and the Company of, and the
performance by each of the Issuer and the Company of their obligations under,
the Agreement and the Securities will not contravene (i) any provision of any
statute, rule, regulation, order, judgment or decree of the State of New Mexico,
or any federal law of the United States of America (except with respect to
federal, state or foreign securities laws as to which I express no opinion) or
(ii) any provision of the New Mexico Public Utility Act (the “NMPUA”) or the
related rules, regulations, published interpretations and orders issued
thereunder.

 

4.
(a) The execution, delivery and performance by the Issuer and the Company of the
Agreement and (b) the incurrence of indebtedness pursuant to the Agreement do
not (i) violate, conflict with, constitute or result in a breach of any of the
terms or provisions of, or a default under (or an event that with notice or the
lapse of time, or both, would constitute a default), (ii) result in the
imposition of a lien or encumbrance on any assets or properties of the Issuer or
the Company pursuant to, or (iii) give rise to any right to accelerate or
require the prepayment or repurchase or redemption of any obligation under (A)
any indenture, contract, instrument or agreement known to me, or (B) any
judgment, order or decree of any court or governmental agency or authority that
has jurisdiction over the Issuer or the Company or their assets or properties.

 
Exhibit 4.4(b)-2

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5.
There are no pending or, to my knowledge, threatened actions or proceedings
against or affecting the Issuer or the Company or any property of the Issuer or
the Company before any court, governmental agency or arbitrator which (a)
purport to affect the legality, validity or enforceability of the Agreement or
the Notes and (b) individually or in the aggregate, if adversely determined,
could be reasonably expected to have a Material Adverse Effect.

 

6.
No consent, approval, authorization, or order of, or qualification with, any
governmental body or agency under the laws of the State of New Mexico, any
federal law of the United States of America, or to the best of my knowledge, any
other state or jurisdiction of the United States, that in my experience is
normally applicable to (i) general business corporations of the same type as the
Company or (ii) grantor trusts of the same type as the Issuer, in relation to
transactions of the type contemplated by the Agreement, is required for the
issuance of the Securities or the execution, delivery and performance by each of
the Issuer and the Company of their obligations under the Agreement, except such
as may be required (i) under federal, state or foreign securities or Blue Sky
laws as to which I express no opinion, (ii) by the FERC as described in
paragraph 7 below, or (iii) by the NMPRC as described in paragraph 10 below.

 

7.
No authorization, consent, approval, or filing or registration with any
governmental agency or body, including the FERC, the FPA and the Public Utility
Holding Company Act of 2005, and the rules and regulations under each, each as
in effect on the date hereof is necessary for (i) the Issuer to issue the Notes
and (ii) for the Company to assume its obligations in connection with the
Securities, except for (1) the authorization that has been duly obtained from
FERC in the 204 Order, and (2) the filing with FERC of a Report of Securities
Issued no later than 30 days after the sale or placement of the Securities.

 

8.
The execution, delivery and performance by the Company and the Issuer of the
Agreement and the Securities, in accordance with their respective terms will not
result in a violation of the FPA or the related rules, regulations, published
interpretations and orders issued thereunder, in each case as presently
implemented or interpreted.

 

9.
As of the date hereof, the 204 Order is still in effect.

 

10.
The NMPRC has issued the 2015 NMPRC Final Order, such order is in full force and
effect, is not subject to rehearing or appeal by any party other than the
Company, and is sufficient to authorize the issuance and sale of the Notes and
the transactions contemplated by the Agreement; and no other action, consent or
approval of, registration or prior filing with or any other action by any
governmental authority pursuant to the NMPUA or pursuant to other statutes of
the State of New Mexico applicable to the Company as a result of the fact that
it is an electric public utility, is or will be required of the Company in
connection with the Securities, except (A) those that (i) have been made or
obtained, (ii) are in full force and effect and (iii) have not been withdrawn
and (B) the filing with the NMPRC of a verified report of the transaction no
later than 90 days after the sale or placement of the Securities.

 
Exhibit 4.4(b)-3

--------------------------------------------------------------------------------

11.
To my knowledge, no stop order, restraining order or denial of an application
for approval has been issued and no investigation, proceeding or litigation has
been commenced or threatened before any governmental or regulatory authority or
court of the State of New Mexico with respect to the Securities.

 
I am a member of the Bar of the State of Texas and the State of New Mexico and
the foregoing opinion is limited to the laws of the State of Texas and the State
of New Mexico and the federal laws of the United States of America, except that
I express no opinion as to any law, rule or regulation that is applicable to the
Issuer, the Company, the Agreement or the transactions contemplated thereby
solely because such law, rule or regulation is part of a regulatory regime
applicable to any party to the Agreement or any of its affiliates due to the
specific assets or business of such party or such affiliate, except as set forth
with respect to the FERC and the NMPUA, and the FPA in paragraphs 7 and 8
above.  The foregoing opinion is based upon existing laws and regulations as of
the date hereof, and I undertake no obligation to advise you of changes that may
be brought to my attention after the date hereof.
 
This opinion letter is being furnished only to you, the Purchasers, solely for
your benefit, exclusively for use in connection with the transactions
contemplated under the Agreement, and is not to be used, quoted, relied upon or
otherwise referred to by any other person or for any other purposes without my
prior written consent, except that my prior written consent is not needed to
furnish a copy of this opinion letter (with no right of reliance): (a) in
connection with any proceedings relating to the Agreement or the enforcement
thereof; (b) to accountants and counsel for the Purchasers; (c) to the National
Association of Insurance Commissioners or bank or other governmental regulatory
examiners; (d) to any rating agency rating any Purchaser; (e) pursuant to
judicial process or government order or requirement; and (f) to prospective
permitted assignees of any Purchaser under the Agreement. This opinion letter
may be provided, without my prior consent (with right of reliance) to the
transferees of Notes that are Institutional Accredited Investors (collectively,
the “Transferees”), in each case on the condition and understanding that (i)
this opinion letter speaks only as of the date hereof, (ii) I have no
responsibility or obligation to update this opinion letter to consider its
applicability or correctness to such Transferee, (iii) in no event shall any
Transferee have any greater rights with respect hereto than the original
addressees of this letter on the date hereof nor, in the case of any Transferee
that becomes a Transferee by assignment, any greater rights than its assignor,
(iv) in furtherance and not in limitation of the foregoing, my consent to such
reliance shall in no event constitute a reissuance of the opinions expressed
herein or otherwise extend any statute of limitations period applicable hereto
on the date hereof, and (v) any such reliance by any such Transferee also must
be actual and reasonable under the circumstances existing at the time of its
becoming a Transferee, including any changes in law or facts, or any other
developments or events known to or reasonably knowable by such Transferee at
such time.
 
Very truly yours,
 
Exhibit 4.4(b)-4

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EXHIBIT 4.4(c)

FORM OF OPINION OF SPECIAL ARIZONA REGULATORY COUNSEL
FOR THE COMPANY
 
June 28, 2018
 
To the Purchasers listed on
Schedules A to the Note Purchase
Agreements referred to below
 

Re:
El Paso Electric Company: 2018 Note Purchase Agreements (Arizona Public Utility
Act Opinion)

 
Ladies and Gentlemen:
 
We have acted as special regulatory counsel in the State of Arizona (the
“State”) to El Paso Electric Company, a Texas corporation (the “Company”), on
matters relating to the Arizona Public Utility Act, 40 A.R.S. §§ 201 et seq.
(the “Act”) in connection with (a) that certain Note Purchase Agreement, dated
as of June 28, 2018, by and among the Company and the Purchasers listed on
Schedule A thereto (the “Senior Note Purchase Agreement”), with respect to
$125,000,000 in 4.22% Senior Notes due August 15, 2028 (the “Company Notes”),
and (b) that certain Notice Purchase Agreement, dated as of June 28, 2018, by
and among the Company, Rio Grande Resources Trust II (the “Issuer”) and the
Purchasers listed on Schedule A thereto (the “Senior Guaranteed Note Purchase
Agreement”; together with the Senior Note Purchase Agreement, the “Note Purchase
Agreements”), with respect to $65,000,000 in 4.07% Senior Guaranteed Notes due
August 15, 2025 (the “Issuer Notes”; together with the Company Notes, the
“Notes”). This opinion letter is given pursuant to Section 4.4(c) of the Senior
Note Purchase Agreement and pursuant to Section 4.4(c) of the Senior Guaranteed
Note Purchase Agreement. Capitalized terms used but not defined herein shall
have the meanings assigned to such terms in the applicable Note Purchase
Agreement. The scope of this opinion letter is limited solely to matters arising
under the Act.
 

A.
Documents and Matters Examined

 
In connection with this opinion letter, we have examined originals or copies of
such documents, records, certificates of public officials, and certificates of
officers and representatives of the Company and others, as we have considered
necessary to provide a basis for the opinions expressed herein, including the
following:
 
A-1.        the Note Purchase Agreements; and
 
A-2         the Notes.
 
As to matters of fact material to the opinions expressed herein, we have relied
on (a) information in public authority documents and information provided in
certificates of officers/representatives of the Company and others, including,
but not limited to, the Officer’s Certificate attached hereto as Exhibit A (the
“Certificate”), (and all opinions based thereon are as of the dates of such
documents and certificates, not as of the date of this opinion letter), and (b)
the representations and warranties of the Company in the Note Purchase
Agreements. We have not independently verified the facts so relied on.
 
Exhibit 4.4(c)-1

--------------------------------------------------------------------------------

B.
Assumptions

 
We have relied, without investigation, on the following assumptions:
 
B-1.         Original documents reviewed by us are authentic, copies of original
documents reviewed by us conform to the originals and all signatures on executed
documents are genuine.
 
B-2.         All individuals have sufficient legal capacity to perform their
functions with respect to the Note Purchase Agreements, the Notes and the
transactions contemplated by the Note Purchase Agreements and the Notes (the
“Transactions”).
 
B-3.         The Note Purchase Agreements and the Notes are valid and binding
obligations of each party thereto, enforceable against such party in accordance
with their terms, and each such party has complied with all legal requirements
pertaining to its status relevant to its right to enforce the applicable Note
Purchase Agreement(s) and the applicable Note(s) against the other parties
thereto.
 
B-4.         All schedules and exhibits to the Note Purchase Agreements that
were not provided to, or reviewed by, us do not materially affect, alter or
amend the terms of the Note Purchase Agreements.
 
B-5.         Each Person executing the Note Purchase Agreements and the Notes
that is an entity: (a) is duly organized, validly existing and in good standing
under all applicable laws; (b) has all requisite corporate or other entity power
to execute and deliver each Note Purchase Agreement and each Note, as
applicable, to which it is a party and to consummate the Transactions; (c) has
taken all corporate or other entity action necessary to authorize the execution
and delivery of each Note Purchase Agreement and each Note, as applicable, to
which it is a party and the consummation of the Transactions; and (d) has duly
executed and delivered each Note Purchase Agreement and each Note, as
applicable, to which it is a party.
 
B-6.         No consent, approval, authorization or other action by, or filing
with, any Governmental Authority is required with respect to (a) the execution
and delivery of the Note Purchase Agreements or any Note, (b) the consummation
of the Transactions, or (c) the borrowings under the Note Purchase Agreements,
by any party other than the Company, except those that have already been made or
obtained. However, we disclaim any knowledge of whether any such consents,
approvals, authorizations, actions or filings have been taken, made or obtained.
 
B-7.         Each Note is in the form attached as Exhibit 1 to the applicable
Note Purchase Agreement.
 
Exhibit 4.4(c)-2

--------------------------------------------------------------------------------

C.
Opinions

 
Based on the foregoing and subject to the qualifications and exclusions stated
below, we express the following opinions:
 
C-1.         The execution and delivery of the Senior Note Purchase Agreement
and the Company Notes by the Company, the execution and delivery of the Senior
Guaranteed Note Purchase Agreement by the Company and the Issuer, the execution
and delivery of the Issuer Notes by the Issuer and the consummation of the
Transactions by the Company and the Issuer do not: (a) violate any provision of
the Act, or any related rules, regulations and published interpretations issued
thereunder, that counsel exercising customary professional judgment would, in
our experience, reasonably recognize as typically applicable to agreements
similar to the Note Purchase Agreements, securities similar to the Notes and
transactions similar to the Transactions; or (b) breach or violate any Order.
“Order” means any court order, or any order issued under the Act by a
Governmental Authority of the State, that is listed on Schedule 1 to the
Certificate, which list was provided by the Company in response to our request
for a list of all such orders binding on the Company, the Issuer or their
respective properties.
 
C-2.         No consent, approval, authorization or other action by, or filing
with, any Governmental Authority of the State pursuant to the Act, or pursuant
to other statutes of the State that (a) counsel exercising customary
professional judgment would, in our experience, reasonably recognize as
typically applicable to agreements similar to the Note Purchase Agreements,
securities similar to the Notes and transactions similar to the Transactions,
and (b) apply to the Company as a result of the Company’s status as an electric
public utility, is required in connection with the execution and delivery by the
Company of the Note Purchase Agreements and the Company Notes and the
consummation of the Transactions, except those that have already been obtained
and made.
 

D.
Qualifications; Exclusions

 
D-1.         The opinions expressed herein are subject to bankruptcy, insolvency
and other similar laws affecting the rights and remedies of creditors generally
and general principles of equity.
 
D-2.        We express no opinion as to the following matters, or the effect, if
any, that they may have on the opinions expressed herein:
 
 
(a)          federal securities laws and regulations, state “blue sky” laws and
regulations, the Investment Company Act, the Trust Indenture Act, and laws and
regulations relating to commodity (and other) futures and indices and other
similar instruments;
 
(b)          federal and state laws and regulations dealing with (i) antitrust
and unfair competition; (ii) filing and notice requirements, other than
requirements applicable to charter-related documents such as a certificate of
merger, and except to the extent as may be expressly noted to the contrary in
this opinion letter as to specific notices or filings; (iii) environmental
matters; (iv) land use and subdivisions; (v) tax; (vi) patents, copyrights,
trademarks and intellectual property; (vii) governmental procurement; (viii)
racketeering; (ix) health and safety; (x) labor and employment; (xi) national
and local emergencies; (xii) requirements and provisions of the USA Patriot Act
or Foreign Corrupt Practices Act, terrorism, foreign assets control, and foreign
investment review or approval; (xiii) possible judicial deference to acts of
sovereign states; (xiv) criminal and civil forfeiture; (xv) statutes of general
application to the extent they provide for criminal prosecution (e.g., mail
fraud, wire fraud and money laundering statutes); (xvi) privacy; and (xvii)
regulation of lenders or opinion recipients, or the conduct of their business,
and that may relate to the Note Purchase Agreements or the Transactions;
 
Exhibit 4.4(c)-3

--------------------------------------------------------------------------------

(c)          Federal Reserve Board margin regulations;
 
(d)          compliance with fiduciary duty requirements;
 
(e)          the statutes and ordinances, the administrative decisions, and the
rules and regulations of counties, cities, towns, municipalities and special
political subdivisions (whether created or enabled through legislative action at
the federal, state or regional level), and judicial decisions to the extent that
they deal with any such statutes, ordinances, administrative decisions, rules or
regulations;
 
(f)           fraudulent transfer and fraudulent conveyance laws;
 
(g)          pension and employee benefit laws and regulations;
 
(h)          the Company’s title to or the condition of title of any property;
 
(i)           the characterization of the Transactions; and
 
(j)           the creation, attachment, perfection, priority or enforcement of
liens or encumbrances.
 
D-3.        We express no opinion as to the enforceability of any provision in
either of the Note Purchase Agreements or any Note.
 
For purposes of expressing the opinions herein, (a) we have examined only the
Act, and (b) our opinions are limited to the Act. We have not reviewed, nor are
our opinions in any way predicated on an examination of, any other laws
(including, but not limited to, any federal or other State laws), and we
expressly disclaim responsibility for advising any Person as to the effect, if
any, that any such other laws may have on the opinions set forth herein.
Furthermore, we express no opinion as to matters that may be affected by any
pending or proposed federal, State or other legislation, even if such
legislation, if subsequently enacted, could affect the opinions expressed
herein.
 
The opinions expressed herein (a) are limited to matters expressly stated
herein, and no other opinions may be implied or inferred, including that we have
performed any actions in order to provide the legal opinions and statements
contained herein, other than as expressly set forth herein, and (b) are as of
the date hereof (except as otherwise noted above). We disclaim any undertaking
or obligation to update these opinions for events and circumstances occurring
after the date hereof (including changes in law or facts, or as to facts
relating to prior events that are subsequently brought to our attention), or to
consider their applicability or correctness as to Persons other than the
addressees.
 
Exhibit 4.4(c)-4

--------------------------------------------------------------------------------

This opinion letter is being furnished only to the Purchasers and is solely for
their benefit, exclusively for use in connection with the Transactions, and may
not be used, quoted, relied upon or otherwise referred to by any other Person or
for any other purposes without our prior written consent, except that our prior
written consent is not needed to furnish a copy of this opinion letter (with no
right of reliance): (a) in connection with any proceedings relating to the Note
Purchase Agreements or the enforcement thereof; (b) to accountants and counsel
for the Purchasers; (c) to the National Association of Insurance Commissioners
or bank or other governmental regulatory examiners; (d) to any rating agency
rating any Purchaser; (e) pursuant to judicial process or government order or
requirement; and (f) to prospective permitted assignees of any Purchaser under
the Note Purchase Agreements. This opinion letter may be provided, without our
prior consent (with right of reliance), to permitted assignees of any Purchaser
under the Note Purchase Agreements that are Accredited Institutional Investors,
on the condition and understanding that: (i) any such reliance must be actual
and reasonable under the circumstances existing at the time of assignment,
including any changes in law, facts or any other development known to or
reasonably knowable by such assignee at such time; (ii) such reliance shall not
constitute a reissuance of the opinions expressed herein or otherwise extend any
limitations applicable hereto on the date hereof; and (iii) in no event shall
any permitted assignee have any greater rights with respect hereto than either
the original addressees of this opinion letter on the date hereof or than its
assignor.
 
Very truly yours,
 
PERKINS COIE LLP
 
Exhibit 4.4(c)-5

--------------------------------------------------------------------------------

EXHIBIT 4.4(d)

FORM OF OPINION OF SPECIAL REGULATORY COUNSEL
FOR THE COMPANY
 
June 28, 2018
 
To the Purchasers listed on
Schedules A to the Note Purchase
Agreements referred to below
 

Re:
El Paso Electric Company: 2018 Note Purchase Agreements (Nuclear Waste Act and
Atomic Energy Act Opinion)

 
Ladies and Gentlemen:
 
We have acted as special regulatory counsel to El Paso Electric Company, a Texas
corporation (the “Company”), on matters relating to (i) the Nuclear Waste Policy
Act of 1982, 42 U.S.C. §§ 10101 et seq. and the Nuclear Waste Policy Amendments
Act of 1987, 42 U.S.C. §§ 10172, 10172a et seq. (collectively, the “Nuclear
Waste Act”), and (ii) the Atomic Energy Act of 1954, 42 U.S.C. §§ 2201, et seq.
(the “Atomic Energy Act”), in connection with (a) that certain Note Purchase
Agreement, dated as of June 28, 2018, by and among the Company and the
Purchasers listed on Schedule A thereto (the “Senior Note Purchase Agreement”),
with respect to $125,000,000 in 4.22% Senior Notes due August 15, 2028 (the
“Company Notes”), and (b) that certain Notice Purchase Agreement, dated as of
June 28, 2018, by and among the Company, Rio Grande Resources Trust II (the
“Issuer”) and the Purchasers listed on Schedule A thereto (the “Senior
Guaranteed Note Purchase Agreement”; together with the Senior Note Purchase
Agreement, the “Note Purchase Agreements”), with respect to $65,000,000 in 4.07%
Senior Guaranteed Notes due August 15, 2025 (the “Issuer Notes”; together with
the Company Notes, the “Notes”). This opinion letter is given pursuant to
Section 4.4(d) of the Senior Note Purchase Agreement and pursuant to Section
4.4(d) of the Senior Guaranteed Note Purchase Agreement. Capitalized terms used
but not defined herein shall have the meanings assigned to such terms in the
applicable Note Purchase Agreement. The scope of this opinion letter is limited
solely to matters arising under the Nuclear Waste Act and the Atomic Energy Act.
 
A.
DOCUMENTS AND MATTERS EXAMINED

 
In connection with this opinion letter, we have examined originals or copies of
such documents, records, certificates of public officials, and certificates of
officers and representatives of the Company and others, as we have considered
necessary to provide a basis for the opinions expressed herein, including the
following:
 
A-1         the Note Purchase Agreements;
 
Exhibit 4.4(d)-1

--------------------------------------------------------------------------------

A-2          the Notes; and
 

A-3
the Renewed Facility Operating License Nos. NPF-41, NPF-51, and NPF-74 issued by
the Nuclear Regulatory Commission (“NRC”) on April 21, 2011, for Palo Verde
Nuclear Generating Station Units 1, 2 and 3, respectively, and amendments
thereto.

 
The documents listed in A-3 are collectively referred to herein as the
“Licenses.”
 
As to matters of fact material to the opinions expressed herein, we have relied
on (a) information in public authority documents and information provided in
certificates of officers/representatives of the Company and others (and all
opinions based thereon are as of the dates of such documents and certificates,
not as of the date of this opinion letter), and (b) the representations and
warranties of the Company in the Note Purchase Agreements. We have not
independently verified the facts so relied on.
 
B.
Assumptions

 
We have relied, without investigation, on the following assumptions:
 
 
B-1          Original documents reviewed by us are authentic, copies of original
documents reviewed by us conform to the originals and all signatures on executed
documents are genuine.
 
B-2          All individuals have sufficient legal capacity to perform their
functions with respect to the Note Purchase Agreements, the Notes and the
transactions contemplated by the Note Purchase Agreements and the Notes (the
“Transactions”).
 
B-3          The Note Purchase Agreements and the Notes are valid and binding
obligations of each party thereto, enforceable against such party in accordance
with their terms, and each such party has complied with all legal requirements
pertaining to its status relevant to its right to enforce the applicable Note
Purchase Agreement(s) and the applicable Note(s) against the other parties
thereto.
 
B-4          All schedules and exhibits to the Note Purchase Agreements that
were not provided to, or reviewed by, us do not materially affect, alter or
amend the terms of the Note Purchase Agreements.
 
B-5          Each Person executing the Note Purchase Agreements and the Notes
that is an entity: (a) is duly organized, validly existing and in good standing
under all applicable laws; (b) has all requisite corporate or other entity power
to execute and deliver each Note Purchase Agreement and each Note, as
applicable, to which it is a party and to consummate the Transactions; (c) has
taken all corporate or other entity action necessary to authorize the execution
and delivery of each Note Purchase Agreement and each Note, as applicable, to
which it is a party and the consummation of the Transactions; and (d) has duly
executed and delivered each Note Purchase Agreement and each Note, as
applicable, to which it is a party.
 
Exhibit 4.4(d)-2

--------------------------------------------------------------------------------

B-6          No consent, approval, authorization or other action by, or filing
with, any Governmental Authority is required with respect to (a) the execution
and delivery of the Note Purchase Agreements or any Note, (b) the consummation
of the Transactions, or (c) the borrowings under the Note Purchase Agreements,
by any party other than the Company, except those that have already been made or
obtained. However, we disclaim any knowledge of whether any such consents,
approvals, authorizations, actions or filings have been taken, made or obtained.
 
B-7          Each Note is in the form attached as Exhibit 1 to the applicable
Note Purchase Agreement.
 
B-8          The Licenses and all agreements (other than the Note Purchase
Agreements and the Notes) and court orders will be enforced as written.
 
B-9          The Company and the Issuer will not in the future take any
discretionary action (including a decision not to act) permitted under the Note
Purchase Agreements that would result in the violation of any of the Licenses or
any law or that would constitute a breach or default under any other agreement
or court order.
 
B-10        The Company and the Issuer will obtain all permits and governmental
approvals required in the future, will comply with the terms of the Licenses,
and will take all actions similarly required, relevant to subsequent
consummation of the Transactions or performance of the Note Purchase Agreements.
 
B-11        All parties to the Transactions will act in accordance with, and
will refrain from taking any action that is forbidden by, the terms and
conditions of the Note Purchase Agreements.
 
B-12        The Company and the Issuer (a) do not receive, possess, handle,
store, use, or transfer any source material, byproducts material or special
nuclear materials, as those terms are defined in the Atomic Energy Act, and (b)
do not receive, possess, handle, store, use, or transfer any spent nuclear fuel
or high-level radioactive waste, as those terms are defined in the Nuclear Waste
Act.
 
C.
Opinions

 
Based on the foregoing and subject to the qualifications and exclusions stated
below, we express the following opinions:
 
 
C-1          Except for the general NRC consents contained in 10 C.F.R. §
50.81(a) (2018) and 10 C.F.R. § 72.52(b) (2018), no consent, approval,
authorization or other action by, or filing with, the NRC is required in
connection with: (i) the execution and delivery of the Senior Note Purchase
Agreement and the Company Notes by the Company, the execution and delivery of
the Senior Guaranteed Note Purchase Agreement by the Company and the Issuer, the
execution and delivery of the Issuer Notes by the Issuer and the consummation of
the Transactions by the Company and the Issuer; (ii) the utilization by the
Purchasers of the NRC “consent” contained in 10 C.F.R. § 50.81(a) (2018) “to the
creation of any mortgage, pledge, or other lien upon any production or
utilization facility not owned by the United States which is the subject of a
license or upon any leasehold or other interest in such facility”; and (iii) the
utilization by the Purchasers of the NRC “consent” contained in 10 C.F.R. §
72.52(b) (2018) “to the creation of any mortgage, pledge, or other lien on
special nuclear material contained in spent fuel not owned by the United States
that is the subject of a license or on any interest in special nuclear material
in spent fuel”; provided, however, that the rights of such Purchasers may be
exercised only in compliance with, and subject to, the Atomic Energy Act and
applicable NRC regulations, including but not limited to 10 C.F.R. § 50.38
(2018), 10 C.F.R. § 50.81 (2018) and 10 C.F.R. § 72.52 (2018).
 
Exhibit 4.4(d)-3

--------------------------------------------------------------------------------

C-2          Neither the Transactions nor the participation by the Purchasers in
the Transactions pursuant to the Atomic Energy Act and applicable NRC
regulations violate the Atomic Energy Act or the related rules, regulations and
orders issued thereunder that counsel exercising customary professional judgment
would, in our experience, reasonably recognize as typically applicable to
agreements similar to the Note Purchase Agreements, securities similar to the
Notes and transactions similar to the Transactions; provided, however, that the
rights of the Purchasers may be exercised only in compliance with, and subject
to, the Atomic Energy Act and applicable NRC regulations, including, but not
limited to, 10 C.F.R. § 50.38 (2018) and 10 C.F.R. § 50.81 (2018).
 
C-3          Neither the Transactions nor the participation by the Purchasers in
the Transactions pursuant to the Nuclear Waste Act and applicable NRC
regulations violate the Nuclear Waste Act or the related rules, regulations and
orders issued thereunder that counsel exercising customary professional judgment
would, in our experience, reasonably recognize as typically applicable to
agreements similar to the Note Purchase Agreements, securities similar to the
Notes and transactions similar to the Transactions; provided, however, that the
rights of the Purchasers may be exercised only in compliance with, and subject
to, the Nuclear Waste Act and applicable NRC regulations, including, but not
limited to, 10 C.F.R. § 50.38 (2018) and 10 C.F.R. § 72.52 (2018).
 
D.
Qualifications; Exclusions

 
D-1          The opinions expressed herein are subject to bankruptcy, insolvency
and other similar laws affecting the rights and remedies of creditors generally
and general principles of equity.
 
D-2          We express no opinion as to the following matters, or the effect,
if any, that they may have on the opinions expressed herein:
 
(a)          federal securities laws and regulations, state “blue sky” laws and
regulations, the Investment Company Act, the Trust Indenture Act, and laws and
regulations relating to commodity (and other) futures and indices and other
similar instruments;
 
(b)          federal and state laws and regulations dealing with (i) antitrust
and unfair competition; (ii) filing and notice requirements, other than
requirements applicable to charter-related documents such as a certificate of
merger, and except to the extent as may be expressly noted to the contrary in
this opinion letter as to specific notices or filings; (iii) environmental
matters; (iv) land use and subdivisions; (v) tax; (vi) patents, copyrights,
trademarks and intellectual property; (vii) governmental procurement; (viii)
racketeering; (ix) health and safety; (x) labor and employment; (xi) national
and local emergencies; (xii) requirements and provisions of the USA Patriot Act
or Foreign Corrupt Practices Act, terrorism, foreign assets control, and foreign
investment review or approval; (xiii) possible judicial deference to acts of
sovereign states; (xiv) criminal and civil forfeiture; (xv) statutes of general
application to the extent they provide for criminal prosecution (e.g., mail
fraud, wire fraud and money laundering statutes); (xvi) privacy; and (xvii)
regulation of lenders or opinion recipients, or the conduct of their business,
and that may relate to the Note Purchase Agreements or the Transactions;
 
Exhibit 4.4(d)-4

--------------------------------------------------------------------------------

(c)          Federal Reserve Board margin regulations;
 
(d)          compliance with fiduciary duty requirements;
 
(e)          the statutes and ordinances, the administrative decisions, and the
rules and regulations of counties, cities, towns, municipalities and special
political subdivisions (whether created or enabled through legislative action at
the federal, state or regional level), and judicial decisions to the extent that
they deal with any such statutes, ordinances, administrative decisions, rules or
regulations;
 
(f)           fraudulent transfer and fraudulent conveyance laws;
 
(g)          pension and employee benefit laws and regulations;
 
(h)          the Company’s title to or the condition of title of any property;
 
(i)           the characterization of the Transactions; and
 
(j)           the creation, attachment, perfection, priority or enforcement of
liens or encumbrances.
 
D-3          We express no opinion as to the enforceability of any provision in
either of the Note Purchase Agreements or any Note.
 
D-4          10 C.F.R. § 50.38 (2018) provides that “[a]ny person who is a
citizen, national, or agent of a foreign country, or any corporation, or other
entity which the Commission knows or has reason to believe is owned, controlled,
or dominated by an alien, a foreign corporation, or a foreign government, shall
be ineligible to apply for and obtain a license” for any production or
utilization facility. Accordingly, we express no opinion with respect to the
ability of any such Person to obtain or acquire any mortgage, pledge, lien or
other interest in any such production or utilization facility, or in any special
nuclear material in spent fuel.
 
For purposes of expressing the opinions herein, (a) we have examined only the
Nuclear Waste Act and the Atomic Energy Act, and (b) our opinions are limited to
such laws. We have not reviewed, nor are our opinions in any way predicated on
an examination of, any other laws (including, but not limited to, any state or
other federal laws), and we expressly disclaim responsibility for advising any
Person as to the effect, if any, that any such other laws may have on the
opinions set forth herein. Furthermore, we express no opinion as to matters that
may be affected by any pending or proposed federal, state or other legislation,
even if such legislation, if subsequently enacted, could affect the opinions
expressed herein.
 
Exhibit 4.4(d)-5

--------------------------------------------------------------------------------

The opinions expressed herein (a) are limited to matters expressly stated
herein, and no other opinions may be implied or inferred, including that we have
performed any actions in order to provide the legal opinions and statements
contained herein, other than as expressly set forth herein, and (b) are as of
the date hereof (except as otherwise noted above). We disclaim any undertaking
or obligation to update these opinions for events and circumstances occurring
after the date hereof (including changes in law or facts, or as to facts
relating to prior events that are subsequently brought to our attention), or to
consider their applicability or correctness as to Persons other than the
addressees.
 
This opinion letter is being furnished only to the Purchasers and is solely for
their benefit, exclusively for use in connection with the Transactions, and may
not be used, quoted, relied upon or otherwise referred to by any other Person or
for any other purposes without our prior written consent, except that our prior
written consent is not needed to furnish a copy of this opinion letter (with no
right of reliance): (a) in connection with any proceedings relating to the Note
Purchase Agreements or the enforcement thereof; (b) to accountants and counsel
for the Purchasers; (c) to the National Association of Insurance Commissioners
or bank or other governmental regulatory examiners; (d) to any rating agency
rating any Purchaser; (e) pursuant to judicial process or government order or
requirement; and (f) to prospective permitted assignees of any Purchaser under
the Note Purchase Agreements. This opinion letter may be provided, without our
prior consent (with right of reliance), to permitted assignees of any Purchaser
under the Note Purchase Agreements that are Accredited Institutional Investors,
on the condition and understanding that: (i) any such reliance must be actual
and reasonable under the circumstances existing at the time of assignment,
including any changes in law, facts or any other development known to or
reasonably knowable by such assignee at such time; (b) such reliance shall not
constitute a reissuance of the opinions expressed herein or otherwise extend any
limitations applicable hereto on the date hereof; and (iii) in no event shall
any permitted assignee have any greater rights with respect hereto than either
the original addressees of this opinion letter on the date hereof or than its
assignor.
 
Very truly yours,
 
PERKINS COIE LLP
 
Exhibit 4.4(d)-6

--------------------------------------------------------------------------------

EXHIBIT 4.4(e)

FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
 
 
June 28, 2018
 
To Each Purchaser of Notes Named on
Schedule A to the Note Purchase Agreement
Referred to Below
 
Re:          $65,000,000 4.07% Senior Guaranteed Notes due August 15, 2025
of Rio Grande Resources Trust II (El Paso Electric Company (Guarantor))

--------------------------------------------------------------------------------

 
Ladies and Gentlemen:
 
We have acted as your special counsel in connection with your purchase on this
date of $65,000,000 aggregate principal amount of the 4.07% Senior Guaranteed
Notes due August 15, 2025 (the “Notes”) of Rio Grande Resources Trust II, a
trust formed under the laws of the State of Texas (the “Issuer”), issued and
sold to you under and pursuant to that certain Note Purchase Agreement dated as
of June 28, 2018 (the “Note Purchase Agreement”) among the Issuer, El Paso
Electric Company, a Texas corporation (the “Company”), and you.  Capitalized
terms used and not otherwise defined herein shall have the respective meanings
ascribed to such terms in the Note Purchase Agreement.  This opinion is
delivered to you pursuant to Section 4.4(e) of the Note Purchase Agreement.
 
In connection with the foregoing, we have examined the following:
 
 
(i)           executed counterparts of the Note Purchase Agreement;
 
(ii)          the Notes executed and delivered by the Issuer on the date hereof
and registered in the names and in the respective principal amounts set forth on
Schedule A to the Note Purchase Agreement;
 
(iii)         the opinion of Baker Botts LLP, counsel for the Company, dated the
date hereof and delivered responsive to Section 4.4(a) of the Note Purchase
Agreement;
 
(iv)         the opinion of Adrian J. Rodriguez, Senior Vice President ― General
Counsel of the Company, dated the date hereof and delivered responsive to
Section 4.4(b) of the Note Purchase Agreement;
 
Exhibit 4.4(e)-1

--------------------------------------------------------------------------------

(v)          the opinion of Perkins Coie LLP, special Arizona regulatory counsel
for the Company, dated the date hereof and delivered responsive to Section
4.4(c) of the Note Purchase Agreement;
 
(vi)         the opinion of Perkins Coie LLP, special regulatory counsel for the
Company, dated the date hereof and delivered responsive to Section 4.4(d) of the
Note Purchase Agreement;
 
(vii)        the letter, dated June 28, 2018, from U.S. Bancorp Investments,
Inc. and MUFG Securities Americas Inc. to the Company, Baker Botts LLP and
Greenberg Traurig, LLP describing the manner and offering of the Notes (the
“Offeree Letter”);
 
(viii)       certificates of officers or directors, as applicable, of the
Company, dated the date hereof with respect to the matters set forth therein
delivered to you pursuant to Section 4.3 of the Note Purchase Agreement; and
 
(ix)          such other documents, records and instruments and certificates of
public officials as we have deemed necessary or appropriate to enable us to
render this opinion.
 
The documents referred to in clauses (i) and (ii) above are hereinafter referred
to collectively as the “Financing Documents.”
 
We believe that the opinions referred to in clauses (iii), (iv), (v) and (vi)
above are satisfactory in scope and form and nothing has come to our attention
which would lead us to believe that you are not justified in relying thereon. 
As to all matters of fact we have relied solely upon (a) the representations and
warranties of the Company, the Issuer and you set forth in the Note Purchase
Agreement and (b) the certificates of public officials and of the officers and
directors of the Company, and (c) the Offeree Letter, and have assumed, without
independent inquiry, the accuracy of such representations, warranties,
certificates, and of the Offeree Letter.
 
We have assumed the genuineness of all signatures, the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form,
the legal competence of each individual executing any document and that each
Person executing the Financing Documents validly exists and has the power and
authority to enter into and perform its obligations under the Financing
Documents.  We have assumed that the Financing Documents (i) have been duly
authorized, executed and delivered by all Persons party thereto and (ii) are
binding upon, and enforceable against, such Persons (other than the Company and
the Issuer).  In addition, we have relied, to the extent of the matters set
forth therein, upon the Offeree Letter.  We have also assumed that the
execution, delivery and performance of the Financing Documents do not violate or
result in any breach of the constitution, memorandum of association or similar
organizational or constating document of the Company or the Issuer or violate or
result in any breach of any agreement to which the Company or the Issuer is
subject or require any authorization, consent, approval, exemption or other
action by, or notice to or filing with, any governmental authority (excluding
the Federal laws of the United States or the laws of the State of New York)
which has not been obtained.
 
Exhibit 4.4(e)-2

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For purposes of this opinion, we have made such examination of law as we have
deemed necessary.  This opinion is limited solely to (a) the internal
substantive laws of the State of New York as applied by courts located in the
State of New York without regard to conflicts of law principles and (b) the
federal laws of the United States of America, and we express no opinion as to
the laws of any other jurisdiction.  In addition, we note that the Financing
Documents contain provisions stating that they are to be governed by the laws of
the State of New York.  Except to the extent that such provisions are made
enforceable by New York General Obligations Law Section 51401 as applied by New
York state courts or federal courts applying New York choice of law rules, no
opinion is given herein as to any such provisions, or otherwise as to the choice
of law or internal substantive rules of law that any court or other tribunal may
apply to the transactions contemplated by the Financing Documents.
 
We express no opinions as to any anti‑fraud securities, “blue sky,” anti‑trust
or tax laws of any jurisdiction.
 
The opinions set forth below are further subject to the following exceptions,
qualifications and assumptions:
 
(a)          the enforcement of any obligations of any person or entity under
the Financing Documents or otherwise may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, fraudulent transfer, moratorium or other
laws and rules of law affecting the enforcement generally of creditors’ rights
and remedies (including such as may deny giving effect to waivers of debtors’ or
guarantors’ rights), and general principles of equity including any implied duty
of good faith and fair dealing (regardless of whether the application of such
principles is considered in a proceeding in equity or at law);
 
(b)          we express no opinion as to the availability of any specific or
equitable relief of any kind; and
 
(c)          we express no opinion as to the enforceability of any particular
provision of any of the Financing Documents relating to (i) waivers of rights to
object to jurisdiction or venue, consents to jurisdiction or venue, or waivers
of rights to (or methods of) service of process, (ii) waivers of any applicable
defenses, setoffs, recoupments, or counterclaims, (iii) waivers or variations of
legal provisions or rights which are not capable of waiver or variation under
applicable law, or (iv) exculpation or exoneration clauses, contribution
provisions and clauses relating to releases or waivers of immaterial claims or
rights.
 
Based upon the foregoing, it is our opinion that:
 
Exhibit 4.4(e)-3

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1.            The Note Purchase Agreement constitutes the legal, valid and
binding obligation of each of the Company and the Issuer, enforceable against
the Company and the Issuer in accordance with its terms.
 
2.            The Notes constitute the legal, valid and binding obligations of
the Issuer, enforceable against the Issuer in accordance with their terms.
 
3.            The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under existing
law, require the registration of the Notes under the Securities Act of 1933, as
amended, or the qualification of an indenture under the Trust Indenture Act of
1939, as amended.
 
This opinion is being furnished only to you in connection with the purchase of
the Notes pursuant to the Note Purchase Agreement, and is not to be used,
quoted, relied upon or otherwise referred to by any other person or for any
other purposes without our prior written consent, except that this opinion may
be reviewed, but not relied upon, by (i) the professional advisors and/or
auditors of any addressee, (ii) the National Association of Insurance
Commissioners, (iii) legal and regulatory authorities and (iv) prospective
transferees of the Notes, and may be relied upon as of the date hereof by
subsequent holders of the Notes who are Institutional Investors and who have
acquired the Notes in accordance with the terms of the Note Purchase Agreement
as if such subsequent holders were original addressees hereon.  This opinion may
be delivered as required under subpoena, court order or as otherwise required by
law.  This opinion is based on factual matters in existence as of the date
hereof and laws and regulations in effect on the date hereof, and we assume no
obligation to revise or supplement this opinion should such factual matters
change or should such laws or regulations be changed by legislative or
regulatory action, judicial decision or otherwise.
 
Respectfully submitted,
 
 
Exhibit 4.4(e)-4

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