Exhibit 10.4

 

EXECUTION VERSION

 

SECOND SUPPLEMENTAL PARTICIPATION AGREEMENT

 

among

 

U.S. BANK NATIONAL ASSOCIATION

Owner Trustee

 

DEUTSCHE BANK TRUST COMPANY AMERICAS

Indenture Trustee

 

COMCAST MO FINANCIAL SERVICES, INC.

Owner Participant

 

and

 

KANSAS GAS AND ELECTRIC COMPANY

Lessee

 

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Dated as of June 30, 2005

 

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TABLE OF CONTENTS

 

          PAGE

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ARTICLE 1      DEFINITIONS      ARTICLE 2      REFINANCING OF THE 1992 SERIES
BONDS     

Section 2.01.

   Issuance of 2005 Series Bonds    5

Section 2.02.

   Delivery of Second Supplemental Indenture    5

Section 2.03.

   Delivery of Lease Supplement    5

Section 2.04.

   Other Amounts    5

Section 2.05.

   Owner Trust And Financing Statements    6 ARTICLE 3      AMENDMENTS     

Section 3.01.

   New Schedule 1    6

Section 3.02.

   New Schedule 10    6

Section 3.03.

   Amendment To Section 17    6

Section 3.04.

   Definitions    7 ARTICLE 4      REPRESENTATIONS AND WARRANTIES OF OWNER
PARTICIPANT     

Section 4.01.

   Due Organization    10

Section 4.02.

   Due Authorization; Enforceability; etc    10

Section 4.03.

   No Violation    11

Section 4.04.

   Owner Participant’s Liens; Performance Does Not Create Liens    12

Section 4.05.

   Utility Status    12 ARTICLE 5      REPRESENTATIONS AND WARRANTIES OF OWNER
TRUSTEE     

Section 5.01.

   Due Organization    13

Section 5.02.

   Due Authorization; Enforceability; etc    13

Section 5.03.

   No Violation    14

Section 5.04.

   Defaults    15

Section 5.05.

   Location    15

Section 5.06.

   Litigation    15

Section 5.07.

   Lessor’s Liens; Performance Does Not Create Liens    15

Section 5.08.

   Securities Act    15

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ARTICLE 6      REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF INDENTURE TRUSTEE
    

Section 6.01.

   Due Organization    16

Section 6.02.

   Due Authorization; Enforceability    16

Section 6.03.

   No Violation    16 ARTICLE 7      REPRESENTATIONS, WARRANTIES AND AGREEMENTS
OF LESSEE     

Section 7.01.

   Due Incorporation, etc    17

Section 7.02.

   Authorization    17

Section 7.03.

   Execution    17

Section 7.04.

   No Violations    18

Section 7.05.

   Governmental Actions    19

Section 7.06.

   Litigation    19

Section 7.07.

   Regulation    20

Section 7.08.

   No Default    21

Section 7.09.

   No Event of Loss    21

Section 7.10.

   Filings and Recordings    21 ARTICLE 8      CONDITIONS PRECEDENT TO
PARTICIPATION AND COMMITMENT ON THE REFINANCING DATE     

Section 8.01.

   Refinancing Documents    22

Section 8.02.

   2005 Series Bonds    22

Section 8.03.

   Filings and Recordings    22

Section 8.04.

   Representations and Warranties    23

Section 8.05.

   Opinions    23

Section 8.06.

   No Default Certificates    23

Section 8.07.

   1992 Series Bonds    23

Section 8.08.

   Actions, Proceedings or Investigations    23

Section 8.09.

   Consents And Approvals    23

Section 8.10.

   Resolutions, Corporate Proceedings, etc    24

Section 8.11.

   Event of Loss    24

Section 8.12.

   Taxes, Fees and Charges    24

Section 8.13.

   Payment for Bonds and Refinancing Expenses    24

Section 8.14.

   Consents, Authorizations and Instructions of Owner Participant    25

Section 8.15.

   Tax Opinion    25

Section 8.16.

   Compliance Certificate    25

Section 8.17.

   Lessee’s Performance    25

Section 8.18.

   Legality, etc    25

Section 8.19.

   Other Evidence    25

 

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ARTICLE 9      AGREEMENTS AND COVENANTS     

Section 9.01.

   Agreement Respecting Refinancing Documents    26

Section 9.02.

   Prepayment    26

Section 9.03.

   Successor Owner Trustee    26

Section 9.04.

   Trust Agreement    27

Section 9.05.

   Indemnity    27

Section 9.06.

   Continuation Statements    27

Section 9.07.

   Further Assurance    27

Section 9.08.

   Tax Indemnity Agreement    27 ARTICLE 10      SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; BINDING EFFECT     

Section 10.01.

   Survival    28

Section 10.02.

   Binding Effect    28 ARTICLE 11      NOTICES      ARTICLE 12     
MISCELLANEOUS     

Section 12.01.

   Consent and Direction to Owner Trustee    28

Section 12.02.

   Owner Trustee Request    28

Section 12.03.

   Effect of Supplement    29

Section 12.04.

   Execution    29

Section 12.05.

   Governing Law    29

Section 12.06.

   Amendments, Supplements, etc    29

Section 12.07.

   Headings    29

Signatures

         

SCHEDULE 1

               Assumptions     

SCHEDULE 2

               Litigation     

SCHEDULE 3

               Defaults     

SCHEDULE 8B

               Additional Filings and Recordings     

SCHEDULE 10

               Addresses for Notices     

EXHIBIT A

               Lease Supplement     

EXHIBIT B

               Second Supplemental Indenture     

EXHIBIT C

               Opinions     

 

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SECOND SUPPLEMENTAL PARTICIPATION AGREEMENT

 

THIS SECOND SUPPLEMENTAL PARTICIPATION AGREEMENT is dated as of June 30, 2005,
among U.S. BANK NATIONAL ASSOCIATION (as successor in interest to The
Connecticut National Bank), a national banking association, not in its
individual capacity except to the extent set forth herein but solely as owner
trustee (“Owner Trustee”) under the Trust Agreement dated as of September 1,
1987, DEUTSCHE BANK TRUST COMPANY AMERICAS (as successor in interest to Bankers
Trust Company), a New York banking corporation, in its individual capacity to
the extent set forth herein and as indenture trustee (“Indenture Trustee”),
COMCAST MO FINANCIAL SERVICES, INC. (formerly named US West Financial Services,
Inc.), a Colorado corporation, as owner participant (“Owner Participant”), and
KANSAS GAS AND ELECTRIC COMPANY, a Kansas corporation, as lessee (“KGE” or
“Lessee”).

 

RECITALS:

 

A. Owner Trustee, Indenture Trustee (in its individual capacity to the extent
set forth therein, and as indenture trustee), Owner Participant and Lessee have
entered into that certain Participation Agreement dated as of September 1, 1987
(herein called the “Original Participation Agreement”).

 

B. Pursuant to the Original Participation Agreement, Owner Trustee purchased the
Interest from Lessee and leased the Assets to Lessee under that certain Lease
Agreement dated as of September 1, 1987 as subsequently amended by Amendment No.
1 dated as of October 1, 1987, Amendment No. 2 dated as of August 1, 1989, and
Amendment No. 3 dated as of September 18, 1992 (as so amended, herein called the
“Existing Lease”) made between Owner Trustee and Lessee.

 

C. Pursuant to the Original Participation Agreement, Owner Trustee borrowed a
portion of the Purchase Price by issuing and delivering the Initial Series Bonds
and to secure such Bonds and any other Bonds granted a security interest in the
Indenture Estate pursuant to that certain Trust Indenture, Security Agreement
and Mortgage, between Indenture Trustee, Owner Trustee and Lessee, dated as of
September 1, 1987 (herein called the “Original Indenture”).

 

D. Pursuant to Section 17 of the Original Participation Agreement as amended by
a Supplemental Participation Agreement dated as of September 18, 1992 (the
Original Participation Agreement, as so amended, herein called the “Existing
Participation Agreement”), on September 29, 1992, the parties thereto effected a
refinancing (the “Initial Refunding”) of the then Outstanding Initial Series
Bonds by means of the issuance of nonrecourse refunding Bonds (the “1992 Series
Bonds”) pursuant to the Original Indenture as amended and

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supplemented by the First Supplemental Indenture dated as of September 29, 1992
(the Original Indenture as so amended and supplemented, herein called the
“Existing Indenture”).

 

E. Pursuant to Section 17(a) of the Existing Participation Agreement, Lessee has
requested Owner Trustee to effect a refinancing to, among other things, redeem
in whole the 1992 Series Bonds Outstanding as of the date hereof by issuing the
2005 series Bonds (the “2005 Series Bonds”).

 

F. Owner Trustee, Owner Participant and Indenture Trustee, having been given (or
having waived) the requisite prior written notice of the refunding as required
by subsection 17(c) of the Existing Participation Agreement, agree to cooperate
with Lessee to effect such refinancing on or shortly after the date hereof.

 

G. In connection with such refinancing, the parties to the Existing
Participation Agreement desire to enter into this Second Supplemental
Participation Agreement to, among other things, amend Section 17 of the Existing
Participation Agreement in order to, inter alia, permit the aggregate principal
amount of the 2005 Series Bonds to be in an amount which is greater than the
original aggregate principal amount of the 1992 Series Bonds.

 

H. In connection with such refinancing, Lessee and Owner Trustee are entering
into a purchase agreement (the “2005 Purchase Agreement”) and a registration
rights agreement (the “Registration Rights Agreement”) with a group of initial
purchasers named therein (the “2005 Purchasers”), providing for the offering and
sale of the 2005 Series Bonds and the filing of a registration statement (the
“2005 Registration Statement”) with the Commission after such offering and sale
with respect to such Bonds.

 

I. The 2005 Series Bonds will be issued in accordance with Section 2.15 of the
Existing Indenture as amended and supplemented by a second supplemental
indenture dated as of the date hereof (the “Second Supplemental Indenture”) (the
Existing Indenture, as so amended and supplemented by the Second Supplemental
Indenture, herein called the “Indenture”).

 

J. Following the issuance of the 2005 Series Bonds, Lessee will file with the
Commission the 2005 Registration Statement pursuant to the Registration Rights
Agreement.

 

K. Concurrently with such refinancing, Lessee and Owner Participant desire also
to restructure certain terms of the transaction contemplated by the Existing
Participation Agreement and the Existing Lease and, to that end, Owner
Participant will cause Owner Trustee to enter into (i) with Lessee Amendment No.
4 to the Lease Agreement (the “Lease Supplement”) to amend the Existing

 

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Lease (the Existing Lease, as so amended, herein called the “Lease”), (ii) with
KGE Amendment No. 1 to the Ground Lease (the “Ground Lease Amendment”), and with
KGE Amendment No. 1 to the Sublease (the “Sublease Amendment”).

 

Accordingly, in consideration of the foregoing premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

 

ARTICLE 1

DEFINITIONS

 

Capitalized terms used herein, which are not otherwise defined herein, shall
have the meanings set forth in Appendix A to the Existing Participation
Agreement, as amended by this Second Supplemental Participation Agreement.

 

Unless the context otherwise requires, the following capitalized terms when used
herein shall have the following meanings:

 

“Refinancing Documents” shall mean, collectively, the Second Supplemental
Participation Agreement, the Lease Supplement, the Ground Lease Amendment, the
Sublease Amendment, the Second Supplemental Indenture and the 2005 Series Bonds.

 

“Refinancing Expenses” shall mean the fees, expenses, disbursements and costs
incurred in connection with refinancing the 1992 Series Bonds as contemplated by
Section 17 of the Participation Agreement, including without limitation:

 

(i) all expenses and fees in connection with the preparation and printing of any
preliminary offering circular and final offering circular relating to the 2005
Series Bonds and any amendments and supplements thereto and the mailing and
delivering of copies thereof to the 2005 Purchasers and dealers;

 

(ii) the cost of printing and producing the 2005 Purchase Agreement and the
Registration Rights Agreement relating to the 2005 Series Bonds, and any other
documents in connection with the offering, sale and delivery of the 2005 Series
Bonds (to the extent not included in the 2005 Purchasers’ fees);

 

(iii) all expenses and fees in connection with the preparation, printing and
filing of the 2005 Registration Statement, any preliminary prospectus and final
prospectus relating to the 2005 Series Bonds and amendments and supplements
thereto and the mailing and delivering of copies thereof to the 2005 Purchasers
and dealers;

 

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(iv) all fees and expenses in connection with the qualification of the Indenture
under the Trust Indenture Act;

 

(v) the cost of preparing the 2005 Series Bonds and the fees and expenses of
rating agencies;

 

(vi) all 2005 Purchasers’ fees, commissions and expenses (including the
reasonable fees and disbursements of the 2005 Purchasers’ counsel);

 

(vii) the reasonable fees and disbursements of counsel to Owner Trustee and
Indenture Trustee;

 

(viii) the reasonable legal fees and disbursements of Owner Participant and
reasonable out-of-pocket expenses of Banc of America Leasing;

 

(ix) Lessee’s legal and accounting fees and disbursements and its reasonable
out-of-pocket cost and expenses; and

 

all other reasonable fees, expenses and disbursements incurred in connection
with the preparation, execution and delivery of the Refinancing Documents, the
2005 Purchase Agreement, the Registration Rights Agreement, the redemption of
the 1992 Series Bonds, and consummation of the transactions contemplated hereby
or thereby, including the fees and expenses incurred in connection with the
appraisal, title insurance, filing and recordation.

 

ARTICLE 2

REFINANCING OF THE 1992 SERIES BONDS

 

Subject to the terms and conditions hereof, the parties agree to consummate the
transactions contemplated by this Second Supplemental Participation Agreement
simultaneously with the closing of the issuance of 2005 Series Bonds pursuant to
the 2005 Purchase Agreement relating to the 2005 Series Bonds at the offices of
Davis Polk & Wardwell, New York, New York 10017, at 10:00 A.M., New York City
time, on June 30, 2005 (the “Scheduled Refinancing Date”), or at such other
place and on such other Business Day as Lessee shall advise the other parties
hereto is the closing date under such 2005 Purchase Agreement (such Scheduled
Refinancing Date or such other day herein referred to as the “Refinancing
Date”). Subject to the terms and conditions hereof, on the Refinancing Date, (a)
Lessee and Owner Trustee shall execute and deliver the

 

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Lease Supplement, substantially in the form of Exhibit A hereto, (b) Owner
Trustee shall issue the 2005 Series Bonds, and (c) Owner Trustee, Lessee and
Indenture Trustee shall execute and deliver the Second Supplemental Indenture,
substantially in the form of Exhibit B hereto.

 

Section 2.01. Issuance of 2005 Series Bonds. (a) Subject to the terms and
conditions hereof, on the Refinancing Date Owner Trustee shall issue the 2005
Series Bonds, substantially in the form of Exhibit A to the Second Supplemental
Indenture, in the principal amount of $320,000,000 against receipt of payment of
the proceeds of the 2005 Series Bonds.

 

(b) Subject to the terms and conditions hereof, on or prior to the Refinancing
Date, Lessee shall pay to Indenture Trustee on behalf of Owner Trustee the
accrued and unpaid interest (if any) from the most recent Interest Payment Date
on which Lessee has made a payment of Basic Rent.

 

(c) Owner Trustee shall (i) make a distribution in the amount of $68,375,180
(the “Additional Borrowing”) to Owner Participant from the proceeds of the
offering of the 2005 Series Bonds and (ii) deposit, or cause to be deposited,
with Indenture Trustee in immediately available funds $238,354,000 from the
proceeds of the offering of the 2005 Series Bonds which amount referred to in
this clause (ii), together with the amount received from Lessee pursuant to
Subsection 2.01(b), Indenture Trustee shall apply to pay all the outstanding
principal amount of, accrued and unpaid interest (if any) and premium on the
1992 Series Bonds and, except as otherwise provided in Section 2.04 hereof, all
other amounts then due and owing pursuant to the Existing Indenture.

 

Section 2.02. Delivery of Second Supplemental Indenture. Subject to the terms
and conditions hereof, on the Refinancing Date, Owner Trustee, Lessee and
Indenture Trustee shall enter into the Second Supplemental Indenture,
substantially in the form of Exhibit B to this Second Supplemental Participation
Agreement.

 

Section 2.03. Delivery of Lease Supplement. Subject to the terms and conditions
hereof, on the Refinancing Date, Owner Trustee and Lessee shall enter into the
Lease Supplement, substantially in the form of Exhibit A to this Second
Supplemental Participation Agreement.

 

Section 2.04. Other Amounts. Subject to the terms and conditions hereof, on or
after the Refinancing Date, Lessee shall pay to Owner Trustee as Supplemental
Rent on an After-Tax Basis (after taking into account any deduction of
unamortized Transaction Expenses relating to the 1992 Series Bonds) upon receipt
of statements therefor all Refinancing Expenses to the extent they exceed
$12,093,311 and Owner Trustee shall pay upon receipt of statements therefor all
Refinancing Expenses from such amounts received from Lessee and from $12,093,311
received from the net proceeds of the offering of the 2005 Series Bonds.

 

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Section 2.05. Owner Trust And Financing Statements. The name of the trust
created pursuant to Section 2.2 of the Trust Agreement shall be “La Cygne Unit 2
Assets Trust” and such name may (but need not) be used in any correspondence and
filings made by Owner Trustee in connection with the trust created thereby.
Owner Participant and Owner Trustee hereby agree that the foregoing provision of
this Section 2.05 shall replace the sentence in, and shall be deemed an
amendment to, Section 12.15 of the Trust Agreement as if it were set forth in a
separate amendment thereto entered into by such parties pursuant to Section 11
of the Trust Agreement. In connection with the refinancing contemplated by this
Second Supplemental Participation Agreement, the financing statements and
recordings set forth on Schedule 8B hereto (other than those already filed for
the record) shall be filed in the applicable jurisdictions on or as soon as
reasonably practicable after the Refinancing Date.

 

ARTICLE 3

AMENDMENTS

 

Section 3.01. New Schedule 1. The Existing Participation Agreement is amended,
effective as of the Refinancing Date, by deleting Schedule 1 (and Annexes A and
B thereto) in its entirety, and substituting in lieu thereof Schedule 1 (and
Annexes A through E thereto) attached to this Second Supplemental Participation
Agreement.

 

Section 3.02. New Schedule 10. The Existing Participation Agreement is amended,
effective as of the Refinancing Date, by deleting Schedule 10 in its entirety,
and substituting in lieu thereof Schedule 10 attached to this Second
Supplemental Participation Agreement.

 

Section 3.03. Amendment To Section 17. The first sentence of subsection 17(a) of
the Existing Participation Agreement is amended, effective as of the Refinancing
Date (but without affecting any Bonds outstanding on the date hereof), by
deleting such first sentence and substituting in lieu thereof the following new
first sentence:

 

So long as no Lease Default or Lease Event of Default shall have occurred and be
continuing, and subject to full compliance with the terms and conditions of this
Section 17 and of Section 2.15 of the Indenture, Lessee shall have the right to
request Owner Trustee to, and upon any such request, Owner Trustee shall, take
such steps as may be necessary to refund in whole or in part any series of Bonds
then Outstanding (the “Refunded Bonds”) including the issuance and sale of one
or more additional series of Bonds (the “Refunding Bonds”) in an aggregate

 

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principal amount which shall be equal to the unpaid principal amount of the
Refunded Bonds (or if all or any one or more series of the Outstanding Bonds are
being redeemed or surrendered by Owner Trustee to Indenture Trustee for
cancellation, equal to the original aggregate principal amount of such Bonds or
series being so redeemed or so surrendered for cancellation), or such greater
amount as Lessee and Owner Participant shall agree in their sole discretion,
plus commissions, fees and expenses paid or incurred in connection with such
issuance, the proceeds of such issuance and sale to be applied to the extent
necessary to prepay the principal amount of such Outstanding Refunded Bonds;
provided, however, that the Refunding Bonds shall have a maturity date not later
than the maturity date of the Refunded Bonds, or such later date as Lessee and
Owner Participant shall agree in their sole discretion, but in any event not
later than the expiration of the Basic Term; provided, further, that, unless
Owner Participant shall have, in its sole discretion, consented thereto, in no
event shall Lessee exercise the right granted under this Section more than four
times; and, provided, further, that Lessee shall pay to Owner Participant (i) a
fee equal to 3/8% of the aggregate principal amount of the Refunding Bonds
issued in connection with the third exercise of such right and (ii) a fee equal
to 1/2% of the aggregate principal amount of the Refunded Bonds refunded in
connection with the fourth exercise of such right.

 

Section 3.04. Definitions. (a) Appendix A to the Existing Participation
Agreement is amended, effective as of the Refinancing Date, by deleting the
following definitions and substituting in lieu thereof the following new
definitions:

 

“Appraisal” shall mean, as applicable, (a) an appraisal, dated the Funding Date,
of Burns and Roe, Inc. which shall take into account the rights and obligations
of Owner Trustee under the Support Agreements and the Operating Agreement and
state (i) that on the Funding Date, the Fair Market Sale Value of the Interest
shall equal the Purchase Price, (ii) that the Useful Life is at least equal to
125% of the sum of the Interim Lease Term and the Basic Term, (iii) that the
fair market value, as of the day 28 1/2 years after the Basic Lease Commencement
Date, of the Interest shall be at least equal to 20% of the Purchase Price
(computed without regard to inflation or deflation), (iv) that assuming Owner
Trustee, and purchasers from and assignees of Owner Trustee, will have those
rights which the Support Agreements purport to grant and convey to Owner
Trustee, it will be commercially feasible for Owner Trustee, and purchasers from
or assignees of Owner Trustee unrelated to Lessee, to use the Assets upon the
expiration of the Lease Term, (v) that Unit 2 is a fully integrated and, when
operated in conjunction with the Common Facilities and the Support Agreements,
self-contained unit, and each Component of Unit 2 is interrelated to the other
Components in terms of useful life, function, structure and design, (vi) that
the term of the Support Agreements corresponds to the Useful Life (within the
constraints of professional estimation), (vii) the fair market value, as of the

 

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day 28 1/2 years after the Basic Lease Commencement Date, of the Interest
(taking into account the effects of inflation or deflation), and (viii) the Fair
Market Rental Value of the Ground Interest during the Lease Term; or (b) an
appraisal, dated June 17, 2005, of Marshall & Stevens Incorporated which states
(i) the fair market value of the Interest as of the date thereof, (ii) the fair
market value of the Interest at the end of the Basic Term on a constant dollar
(uninflated) basis determined as of the date thereof, (iii) the fair market
value of the Interest at the end of the Basic Term on a real dollar (inflated)
basis determined as of the date thereof, (iv) the remaining Useful Life of Unit
2 as of the date thereof, (v) that the remaining Useful Life of Unit 2 at the
end of the Basic Term is at least 20% of the Useful Life of Unit 2 as of May 16,
1977, the date on which Unit 2 was first placed in service, (vi) that upon the
expiration of the Lease Term or earlier termination of the Lease, there is a
reasonable likelihood that it would be commercially feasible for a party other
than the Lessee to own and operate Unit 2, and (vii) that, based on the estimate
of the fair market value of the Interest at the end of the Basic Term, there is
no economic compulsion for the Lessee to exercise the purchase option provided
for in Section 6 of the Lease because as of the expiration date of the Basic
Term, such purchase option price is expected to equal the fair market value of
the Interest.

 

“Basic Rent Payment Date” shall mean and include (a) each March 29 and September
29, commencing September 29, 1988, throughout (and including the last day of)
the Basic Term, (b) each March 29, June 29, September 29 and December 29,
commencing December 29, 2029, throughout (and including the last day of) any
Renewal Term, if elected, and (c) with respect to payments under the Ground
Lease after the Lease Termination Date, each March 29, June 29, September 29 and
December 29 through the Ground Lease Termination Date.

 

“Basic Term” shall mean the period commencing on the Basic Lease Commencement
Date and ending on September 29, 2029, or such shorter period as may result from
earlier termination as provided in the Lease.

 

“KCC Order” shall mean, as applicable, (a) the order or orders of the State
Corporation Commission of the State of Kansas (i) approving or authorizing the
transactions contemplated by the Operative Documents, and (ii) determining that
neither Owner Trustee, nor Owner Participant, nor Indenture Trustee is an
electric public utility subject to the jurisdiction, control or regulation as
such of such Commission; or (b) the order of such Commission (i) disclaiming
jurisdiction over the refinancing of the Bonds and the restructuring of the
transactions contemplated by the Operative Documents unless and until Lessee
assumes the Outstanding Bonds or purchases the Assets, and (ii) reiterating the
determination made by such Commission previously that neither Owner Trustee, nor
Owner Participant, nor Indenture Trustee is an electric public utility subject
to the jurisdiction, control or regulation as such of such Commission.

 

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“Supplemental Rent” shall mean any and all amounts, liabilities and obligations
other than Basic Rent which Lessee assumes or agrees to pay to or on behalf of
Lessor, Owner Trustee, Owner Participant, any Bondholder, Indenture Trustee or
any Indemnitee under (i) any Operative Document or (ii) any registration rights
agreement or any similar agreement entered into in connection with the issuance
of any Bonds (in each case whether or not designated as Supplemental Rent),
including, without limitation, Casualty Value and Fair Market Sale Value
payments, or damages for breach of any covenants, representations, warranties,
indemnities or agreements therein.

 

(b) Appendix A to the Existing Participation Agreement is further amended,
effective as of the Refinancing Date, by deleting the following definitions in
their entirety: “Refinancing Documents”, “Refinancing Expenses”, “Western
Resources”, and “Western Resources Indenture”.

 

(c) Appendix A to the Existing Participation Agreement is further amended,
effective as of the Refinancing Date, by adding thereto the following new
definitions in the appropriate alphabetical order:

 

“1992 Series Bonds” shall have the meaning ascribed thereto in the Second
Supplemental Participation Agreement.

 

“2005 Series Bonds” shall have the meaning ascribed thereto in the Second
Supplemental Participation Agreement.

 

“Allocated Rent” shall have the meaning ascribed thereto in subsection 3.1(e) of
the Lease.

 

“Amendment No. 4 to Lease Agreement” shall mean Amendment No. 4 to Lease
Agreement dated as of June 30, 2005 between Owner Trustee and Lessee.

 

“Expected End-of-Basic-Term Asset Value” shall mean $342,630,000 which is the
estimated fair market value of the Assets as of the date of expiration of the
Basic Term as set forth in the Appraisal referred to in clause (b) of the
definition thereof.

 

“Lease Period” shall mean the lease periods identified on Schedule 3 to the
Lease.

 

“Lessee Loan Balance” shall have the meaning ascribed thereto in subsection
3.1(f) of the Lease.

 

“Lessor Loan Balance” shall have the meaning ascribed thereto in subsection
3.1(f) of the Lease.

 

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“Second Supplemental Indenture” shall mean the Second Supplemental Indenture
dated as of June 30, 2005, to the Trust Indenture, Security Agreement and
Mortgage dated as of September 1, 1987, as supplemented by the First
Supplemental Indenture dated as of September 29, 1992, among Owner Trustee,
Lessee and Indenture Trustee.

 

“Second Supplemental Participation Agreement” shall mean the Second Supplemental
Participation Agreement dated as of June 30, 2005, to the Participation
Agreement dated as of September 1, 1987, as supplemented by the Supplemental
Participation Agreement dated as of September 18, 1992, among Owner Trustee,
Indenture Trustee, Owner Participant and Lessee.

 

“Section 467 Loan Balance” shall mean the Lessor Loan Balance and the Lessee
Loan Balance.

 

“Westar Energy” shall mean Westar Energy, Inc. (formerly named Western
Resources, Inc.), a Kansas corporation, and its successors and assigns.

 

“Westar Energy Indenture” shall mean that certain Mortgage and Deed of Trust,
dated July 1, 1939, between Westar Energy and Harris Trust and Savings Bank, and
any other indenture executed by Westar Energy after September 29, 1992 pursuant
to which Westar Energy may from time to time issue mortgage bonds, as any of
them have been heretofore or may be hereafter amended, modified or supplemented
from time to time.

 

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF OWNER PARTICIPANT

 

Owner Participant represents and warrants that:

 

Section 4.01. Due Organization. Owner Participant is a corporation duly
organized and validly existing in good standing under the laws of the State of
Colorado and has the corporate power and authority to enter into and perform its
obligations under this Second Supplemental Participation Agreement and each
other Refinancing Document and each Operative Document to which it is or will be
a party.

 

Section 4.02. Due Authorization; Enforceability; etc. This Second Supplemental
Participation Agreement and each other Refinancing Document and each Operative
Document to which it is or will be a party have been or, when executed and
delivered, will be, duly authorized, executed and delivered by Owner Participant
and, assuming the due authorization, execution and delivery hereof and thereof
by the other parties hereto and thereto and the correctness on the date hereof
of Lessee’s representations in subsections 9.1.5 and 9.1.13 of the

 

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Existing Participation Agreement (without, for purposes of this representation,
taking into account the exceptions stated in clauses (i) and (iv) of said
subsection 9.1.5 as such exceptions relate to Governmental Actions required by
or with respect to Owner Participant or any Affiliate thereof) and in Section
7.05 hereof (without, for purposes of this representation, taking into account
the exceptions stated in clauses (i) and (iv) of said Section 7.05 as such
exceptions relate to Governmental Actions required by or with respect to Owner
Participant or any Affiliate thereof) and in Section 7.07 hereof (for purposes
of this representation without assuming the correctness of any representation,
action or fact by or relating to Owner Participant or any Affiliate thereof
referred to therein), are or, upon execution and delivery thereof, will be
legal, valid and binding obligations of Owner Participant, enforceable against
Owner Participant in accordance with their respective terms; provided, however,
that the enforceability thereof may be limited by bankruptcy, reorganization,
insolvency or other laws of general application relating to or affecting the
enforcement of creditor’s rights and may be limited by laws or decisions with
respect to or affecting the enforceability of specific performance or other
remedies provided therein. Any direction given by Owner Participant to Owner
Trustee pursuant to the Trust Agreement will have been duly authorized.

 

Section 4.03. No Violation. The execution and delivery by Owner Participant of
this Second Supplemental Participation Agreement and each other Refinancing
Document and each Operative Document to which it is or will be a party are not
and will not be, and the performance by Owner Participant of its obligations
under each is not and will not be, inconsistent with its charter documents or
by-laws, do not and will not contravene any Governmental Rule applicable to it
(assuming the correctness on the date hereof of Lessee’s representations in
subsections 9.1.5 and 9.1.13 of the Existing Participation Agreement (without,
for purposes of this representation, taking into account the exceptions stated
in clauses (i) and (iv) of said subsection 9.1.5 as such exceptions relate to
Governmental Actions required by or with respect to Owner Participant or any
Affiliate thereof) and in Section 7.05 hereof (without, for purposes of this
representation, taking into account the exceptions stated in clauses (i) or (iv)
of said Section 7.05 as such exceptions relate to Governmental Actions required
by or with respect to Owner Participant or any Affiliate thereof) and in Section
7.07 hereof (for purposes of this representation without assuming the
correctness of any representation, action or fact by or relating to Owner
Participant or any Affiliate thereof referred to therein)), and do not and will
not contravene any provision of, or constitute a default under, any indenture,
mortgage, contract or other instrument to which Owner Participant is a party or
by which it or its property is bound, or require any Governmental Action
(assuming the correctness of the date hereof of Lessee’s representations in
subsections 9.1.5 and 9.1.13 of the Existing Participation Agreement (without,
for purposes of this representation, taking into account the exceptions stated
in clauses (i) and (vi) of said subsection

 

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9.1.5 as such exceptions relate to Governmental Actions required by or with
respect to Owner Participant or any Affiliate thereof) and in Section 7.05
hereof (without, for purposes of this representation, taking into account the
exceptions stated in clauses (i) or (iv) of said Section 7.05 as such exceptions
relate to Governmental Actions required by or with respect to Owner Participant
or any Affiliate thereof) and in Section 7.07 hereof (for purposes of this
representation without assuming the correctness of any representation, action or
fact by or relating to Owner Participant or any Affiliate thereof referred to
therein)) which in each case is material to the transactions contemplated
hereby, provided that the foregoing representation by Owner Participant shall
constitute no representation or warranty with respect to any Federal or state
securities laws.

 

Section 4.04. Owner Participant’s Liens; Performance Does Not Create Liens.
Neither the execution and delivery by Owner Participant of this Second
Supplemental Participation Agreement or any other Operative Document or
Refinancing Document to which it is or will be a party, nor the performance by
it of its obligations hereunder or thereunder will subject the Trust Estate or
the Indenture Estate, or any portion thereof, to any Lien under any indenture,
mortgage, contract or other instrument to which Owner Participant is a party or
by which it is bound, other than the Indenture, and Owner Participant has not
taken or knowingly omitted to take any action which would result in the creation
of any Lien on any part of the Trust Estate or the Indenture Estate.

 

Section 4.05. Utility Status. Assuming the correctness of Lessee’s
representations in paragraphs 9.1.5 and 9.1.13 of the Existing Participation
Agreement (for purposes of this representation without taking into account the
exceptions stated in clauses (i) and (iv) of said subsection 9.1.5 as such
exceptions relate to Governmental Actions required by or with respect to Owner
Participant or any Affiliate thereof) and in Section 7.07 hereof (for purposes
of this representation without assuming the correctness of any representation,
action or fact by or relating to Owner Participant or any Affiliate thereof
referred to therein) and in Section 7.05 hereof (without, for purposes of this
representation, taking into account the exceptions stated in clauses (i) or (iv)
of said Section 7.05 as such exceptions relate to Governmental Actions required
by or with respect to Owner Participant or any Affiliate thereof), none of Owner
Participant or its Affiliates is:

 

(i) a “holding company” or a “subsidiary company” of a “holding company” or an
“affiliate” of a “subsidiary company” or “holding company” or “public utility”
within the meaning of the Holding Company Act or subject to regulation under the
Holding Company Act or subject to the jurisdiction, control or regulation of the
Commission thereunder (other than the timely filing of Form U-7D, which has been
done, and the timely filing of any subsequent amendment thereto);

 

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(ii) a “public utility” within the meaning of the Federal Power Act or subject
to regulation under the Federal Power Act or subject to the jurisdiction,
control or regulation of the Federal Energy Regulatory Commission thereunder;

 

(iii) an “electric public utility” within the meaning of the laws of the State
of Kansas; subject to regulation as such (as to rates or the issuance of
securities) under any comparable law of the State of Kansas; or subject to the
jurisdiction, control or regulation of the KCC as an “electric public utility”;
or

 

(iv) subject to the jurisdiction, control or regulation by any other
Governmental Authority under any other Governmental Rules relating to electric
public utilities or the production, sale or transmission of electric energy.

 

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF OWNER TRUSTEE

 

U.S. Bank National Association (“USB”), as Owner Trustee and in its individual
capacity to the extent set forth herein, represents and warrants that:

 

Section 5.01. Due Organization. USB is a national banking association validly
existing in good standing under the banking laws of the United States of America
and has the corporate power and authority to enter into and perform its
obligations (a) in its individual capacity under the Trust Agreement and, to the
extent it is a party hereto or thereto in its individual capacity, this Second
Supplemental Participation Agreement and the Existing Participation Agreement
and (b) acting as Owner Trustee under the Trust Agreement, under this Second
Supplemental Participation Agreement and each other Operative Document and
Refinancing Document to which it is or will be a party as Owner Trustee. USB is
not primarily engaged in the public utility business.

 

Section 5.02. Due Authorization; Enforceability; etc. This Second Supplemental
Participation Agreement and each other Operative Document and Refinancing
Document to which USB is or will be a party have been or will be (to the extent
it is to be a party thereto in its individual capacity), or (to the extent it is
to be a party thereto as Owner Trustee) upon due direction by Owner Participant
or its successors or assigns pursuant to the Trust Agreement will be, duly
authorized, executed and delivered by or on behalf of USB (in its individual
capacity or in its capacity as Owner Trustee, as the case may be) and, assuming
due authorization, execution and delivery by the other parties hereto and
thereto, are or upon execution and delivery will be legal, valid and binding
obligations of USB (in its individual capacity or in its capacity as Owner
Trustee, as the case

 

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may be) enforceable against it in accordance with their respective terms. Upon
execution of the 2005 Series Bonds by USB, as Owner Trustee, authentication
thereof by Indenture Trustee and delivery thereof against payment or the giving
of consideration therefor in accordance with the Indenture and this Second
Supplemental Participation Agreement, the 2005 Series Bonds will be legal, valid
and binding obligations of USB, as Owner Trustee, enforceable against it in
accordance with their respective terms; provided, however, that the
enforceability thereof may be limited by bankruptcy, reorganization, insolvency
or other laws of general application relating to or affecting the enforcement of
creditor’s rights and may be limited by laws or decisions with respect to or
affecting the enforceability of specific performance or other remedies provided
therein.

 

Section 5.03. No Violation. The execution and delivery by (a) USB, in its
individual capacity, of the Trust Agreement and, to the extent it is a party
hereto or thereto in its individual capacity, this Second Supplemental
Participation Agreement and the Existing Participation Agreement and (b) USB, in
its capacity as Owner Trustee, of each Operative Document and each Refinancing
Document to which Owner Trustee is or will be party, are not or will not be, and
the performance by USB in its individual capacity or as Owner Trustee, as the
case may be, of its obligations under each is not and will not be, inconsistent
with the charter documents or by-laws of USB, do not and will not contravene any
Connecticut or United States Governmental Rule (assuming the correctness of
Lessee’s representations in subsections 9.1.5 and 9.1.13 of the Existing
Participation Agreement (without, for purposes of this representation, taking
into account the exceptions stated in clauses (i) and (iv) of said subsection
9.1.5 as such exceptions relate to Governmental Actions required by or with
respect to USB or any Affiliate thereof) and in Section 7.05 hereof (without,
for purposes of this representation, taking into account the exceptions stated
in clauses (i) or (iv) of said Section 7.05 as such exceptions relate to
Governmental Actions required by or with respect to USB or any Affiliate
thereof) and in Section 7.07 hereof (for purposes of this representation without
assuming the correctness of any representation, action or fact by or relating to
USB or any Affiliate thereof referred to therein)) applicable to USB or the
banking or trust powers of USB and do not and will not contravene any provision
of, or constitute a default under, any indenture, mortgage, contract or other
instrument to which USB is a party or by which it or its property is bound or
require any Connecticut or Federal Governmental Action relating to its banking
or trust powers (assuming the correctness of Lessee’s representations in
subsections 9.1.5 and 9.1.13 of the Existing Participation Agreement (without,
for purposes of this representation, taking into account the exceptions stated
in clauses (i) and (iv) of said subsection 9.1.5 as such exceptions relate to
Governmental Actions required by or with respect to USB or any Affiliate
thereof) and in Section 7.05 hereof (without, for purposes of this
representation, taking into account the exceptions stated in clauses (i) or (iv)
of said Section 7.05 as such exceptions relate to Governmental

 

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Actions required by or with respect to USB or any Affiliate thereof) and in
Section 7.07 hereof (for purposes of this representation without assuming the
correctness of any representation, action or fact by or relating to USB or any
Affiliate thereof referred to therein)).

 

Section 5.04. Defaults. To the best knowledge of USB, in its capacity as Owner
Trustee, no Indenture Default or Indenture Event of Default has occurred and is
continuing. USB in its capacity as Owner Trustee is not in violation in any
respect of any term of this Second Supplemental Participation Agreement or any
other Operative Document or Refinancing Document to which it is a party.

 

Section 5.05. Location. The “Location” of USB for Uniform Commercial Code
purposes is the State of Ohio.

 

Section 5.06. Litigation. There is no action, suit, investigation or proceeding
pending or, to the knowledge of USB, threatened against USB (in its individual
capacity or as Owner Trustee) before any court, arbitrator or administrative or
governmental body governing its banking or trust powers which, individually or
in the aggregate, if decided adversely to the interests of USB (in either such
capacity), would have a materially adverse effect upon the ability of USB (in
either such capacity) to perform its obligations under this Second Supplemental
Participation Agreement or any other Operative Document or Refinancing Document
to which it is or will be a party (in either such capacity).

 

Section 5.07. Lessor’s Liens; Performance Does Not Create Liens. Neither the
execution and delivery by USB in its capacity as Owner Trustee of this Second
Supplemental Participation Agreement or any other Operative Document or
Refinancing Document to which it is or will be a party nor the performance by it
of its obligations hereunder or thereunder will subject the Trust Estate or the
Indenture Estate, or any portion thereof, to any Lien under any indenture,
mortgage, contract or other instrument to which USB, in its capacity as Owner
Trustee, is a party or by which it is bound, other than the Indenture.

 

Section 5.08. Securities Act. Other than the offering and sale of the Initial
Series Bonds, the 1992 Series Bonds and the 2005 Series Bonds, neither USB (in
its individual capacity or as Owner Trustee) nor anyone authorized by USB (in
its capacity as Owner Trustee) has directly or indirectly offered or sold any
interest in the Trust Estate or the Indenture Estate or in any similar security
relating to the Interest, or in any security the offering of which for the
purposes of the Securities Act would be deemed to be part of the same offering
as the offering of the aforementioned securities to, or solicited any offer to
acquire any of the same from, any Person, and neither USB (in its individual
capacity or as Owner Trustee) nor anyone authorized to act on its behalf will
take any action which would subject the issuance or sale of any interest in the
Trust Estate or the Indenture Estate (other than the Initial Series Bonds, the
1992 Series Bonds and the 2005 Series Bonds) to the provisions of Section 5 of
the Securities Act.

 

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ARTICLE 6

REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF INDENTURE TRUSTEE

 

Indenture Trustee represents and warrants in its individual capacity that:

 

Section 6.01. Due Organization. Indenture Trustee is a banking corporation duly
organized and validly existing in good standing under the laws of the State of
New York and has the corporate power and authority and legal right to enter into
and perform its obligations under this Second Supplemental Participation
Agreement and each other Refinancing Document or Operative Document to which it
is or will be a party.

 

Section 6.02. Due Authorization; Enforceability. This Second Supplemental
Participation Agreement, each other Refinancing Document and each Operative
Document to which Indenture Trustee is or will be a party have been, or when
executed and delivered will be, duly authorized, executed and delivered by
Indenture Trustee, in its individual capacity and as Indenture Trustee, and,
assuming the due authorization, execution and delivery hereof and thereof by the
other parties hereto and thereto and the correctness of Lessee’s representations
in subsections 9.1.5 and 9.1.13 of the Existing Participation Agreement, are or,
upon execution and delivery thereof, will be legal, valid and binding
obligations of Indenture Trustee, enforceable against it in accordance with
their respective terms; provided, however, that the enforceability thereof may
be limited by bankruptcy, reorganization, insolvency or other laws of general
application relating to or affecting the enforcement of creditor’s rights and
may be limited by laws or decisions with respect to or affecting the
enforceability of specific performance or other remedies provided therein. The
2005 Series Bonds issued on the Refinancing Date will have been duly
authenticated.

 

Section 6.03. No Violation. The execution and delivery by Indenture Trustee of
this Second Supplemental Participation Agreement and each other Refinancing
Document or each other Operative Document to which it is or will be a party are
not, or will not be, and the performance by it of the obligations under each
will not be, inconsistent with the charter or by-laws of Indenture Trustee, do
not and will not contravene any Governmental Rule applicable to it (assuming the
correctness of Lessee’s representations in subsections 9.1.5 and 9.1.13 of the
Existing Participation Agreement (without, for purposes of this representation,
taking into account the exceptions stated in clause (i) of said subsection 9.1.5
as such exceptions relate to Governmental Actions required by or with respect to
Indenture Trustee or any Affiliate thereof) and in Section 7.05 hereof (without,
for purposes of this representation, taking into account the exceptions stated
in clause

 

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(i) of said Section 7.05 as such exceptions relate to Governmental Actions
required by or with respect to Indenture Trustee or any Affiliate thereof) and
in Section 7.07 hereof (for purposes of this representation without assuming the
correctness of any representation, action or fact by or relating to Indenture
Trustee or any Affiliate thereof referred to therein)), or require any
Governmental Action.

 

ARTICLE 7

REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF LESSEE

 

Lessee represents and warrants that:

 

Section 7.01. Due Incorporation, etc. Lessee is a corporation duly organized and
validly existing in good standing under the laws of the State of Kansas and has
the corporate power and authority to perform its obligations under this Second
Supplemental Participation Agreement and each other Operative Document or
Refinancing Document to which it is or will be a party. Lessee has not failed to
qualify to do business in any jurisdiction where failure so to qualify would
materially and adversely affect the financial condition of Lessee or affect its
ability to perform any of its obligations under this Second Supplemental
Participation Agreement or any other Operative Document or Refinancing Document
to which it is or will be a party.

 

Section 7.02. Authorization. The execution, delivery and performance by Lessee
of this Second Supplemental Participation Agreement and each other Operative
Document or Refinancing Document to which it is or will be a party on or before
the Refinancing Date have been duly authorized by all necessary corporate action
on the part of Lessee and do not, and will not, require the consent or approval
of any shareholder of Lessee or any trustee or holder of any indebtedness or
other obligation of Lessee or any other Person which is a party to any other
agreement with Lessee, except for (i) such approvals and consents which were
obtained on or before the Funding Date (which approvals and consents are still
in force and effect and have not been revoked) and (ii) the consent and approval
of certain other parties to this Second Supplemental Participation Agreement to
the extent required by Section 17 of the Existing Participation Agreement which
consent shall be deemed given by each such party’s execution of this Second
Supplemental Participation Agreement.

 

Section 7.03. Execution. This Second Supplemental Participation Agreement and
each other Operative Document or Refinancing Document to which Lessee is or will
be a party have been or when executed and delivered will be, duly executed and
delivered by Lessee and, assuming the due authorization, execution and delivery
hereof and thereof by the other parties hereto and thereto are, or upon
execution and delivery thereof will be, legal, valid and binding obligations of
Lessee, enforceable against Lessee in accordance with their

 

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respective terms; provided, however, that the enforceability thereof may be
limited by bankruptcy, reorganization, insolvency or other laws of general
application relating to or affecting the enforcement of creditor’s rights and
may be limited by laws or decisions with respect to or affecting the
enforceability of specific performance or other remedies provided therein.

 

Section 7.04. No Violations. Provided that the Governmental Actions described in
Section 7.05 hereof (other than those referred to in clause (i) thereof) and in
subsection 9.1.5 of the Existing Participation Agreement are obtained as
required thereby, the execution and delivery by Lessee of this Second
Supplemental Participation Agreement and each other Operative Document or
Refinancing Document to which it is or will be a party are not and will not be,
and the performance by Lessee of its obligations under each thereof will not be,
inconsistent with its charter documents or by-laws, do not and will not
contravene any Governmental Rule or Governmental Action applicable to it which,
in each case, is material to the transactions contemplated hereby, and do not
and will not contravene any provision of, or constitute a default under, any
indenture, mortgage, contract or other instrument to which Lessee is a party or
by which it or its property is bound, and has not resulted and will not result
in the creation or imposition of any Lien (other than Permitted Interest Liens
or Permitted Project Liens and other than the Lien of the Westar Energy
Indenture and any other Lien affecting Westar Energy’s assets but only from and
after the merger or consolidation of Lessee with or into Westar Energy or any
Affiliate thereof or the transfer of assets from Lessee to Westar Energy or any
Affiliate thereof) upon any property of Lessee; except as disclosed in any
annual, quarterly or current reports filed by Lessee with the Commission prior
to or on the date of the execution and delivery hereof, there is no such, and on
the Refinancing Date will not be any such, provision which materially adversely
affects or (so far as Lessee now can reasonably foresee) in the future is likely
materially adversely to affect the properties, business or financial condition
of Lessee; there is no such, and on the Refinancing Date will not be any such,
provision which materially adversely affects or (so far as Lessee now can
reasonably foresee) in the future is likely materially adversely to affect
Lessee’s ability to perform its obligations under this Second Supplemental
Participation Agreement or any other Operative Document or Refinancing Document
to which it is or will be a party; and Lessee is not, and on the Refinancing
Date will not be, in default under or with respect to the provisions of its
charter documents, by-laws, any Governmental Rule (subject to the proviso at the
beginning of this sentence) (it being understood that no representation or
warranty is made concerning compliance with state securities and blue sky laws
or Governmental Action) (except as disclosed by Lessee in any annual, quarterly
or current reports filed by Lessee with the Commission prior to or on the date
of execution and delivery hereof) or any indenture, mortgage, lease or any other
agreement or instrument to which Lessee is a party or by which it or any of its
properties is bound (except as disclosed on Schedule 3 hereto) in each

 

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case which could be materially adverse to the properties, business or financial
condition of Lessee or (so far as Lessee now can reasonably foresee) in the
future is likely materially and adversely to affect the ability of Lessee to
perform its obligations under this Second Supplemental Participation Agreement
or any other Operative Document or Refinancing Document to which it is or will
be a party.

 

Section 7.05. Governmental Actions. Based on Governmental Rules in effect on the
date hereof (and assuming that the representations set forth in subsections
5.1.3, 5.1.8, 6.1.3 and 8.1.3 of the Existing Participation Agreement are
correct immediately prior to the Refinancing Date but without taking into
account any assumption therein as to any representation by Lessee), no
Governmental Actions are or (so far as Lessee can reasonably foresee) will be
required (a) in connection with the participation by Lessee, Owner Trustee,
Indenture Trustee, or Owner Participant in the consummation of the transactions
contemplated by this Second Supplemental Participation Agreement or any of the
other Refinancing Documents or (b) in connection with the execution and delivery
by any of such Persons of any of the Refinancing Documents except, in each case
under clauses (a) and (b) above, (i) such as may be required under applicable
Governmental Rules providing for the supervision or regulation of the businesses
of Owner Trustee (in its individual capacity or as Owner Trustee), Indenture
Trustee, or Owner Participant (not including Governmental Rules specifically
relating to ownership or financing of electric utility assets applicable solely
because of such Person’s execution of any of the Operative Documents or
Refinancing Documents or participation in the transactions contemplated
thereby), (ii) appropriate filings and recordings to perfect and assign an
interest in the Lien of the Indenture and the filing of continuation statements
with respect thereto at appropriate intervals, (iii) such as may be required
under any Governmental Rule enacted or adopted after the date of this
representation, (iv) the timely filing by Owner Participant and/or Owner Trustee
of an amendment to Form U-7D under Rule 7(d) of the Commission, and (v) such as
may be required in connection with any refinancing or refunding of the 2005
Series Bonds and the issuance of additional Bonds after the Refinancing Date.
The representation contained in this paragraph is given, to the extent
applicable, in reliance on the representations and warranties contained in
subsections 5.1.3 (with respect to Governmental Actions and Governmental Rules),
5.1.5, 5.1.6, 5.1.7, 5.1.8, 6.1.3 (with respect to Governmental Actions and
Governmental Rules), 6.1.7 and 8.1.3 (with respect to Governmental Actions and
Governmental Rules) of the Existing Participation Agreement and (with respect to
Governmental Actions and Governmental Rules) Sections 4.03, 5.03, 5.08 and 6.03
hereof (but without taking into account any assumption therein as to any
representation by Lessee).

 

Section 7.06. Litigation. Except as described on Schedule 2 hereto, there is no
action, suit, investigation or proceeding pending or, to the knowledge of
Lessee, threatened against Lessee or its properties before any court, arbitrator
or administrative or governmental body which, individually or in the aggregate
(so

 

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far as Lessee now can reasonably foresee), is likely to have a material adverse
effect on the properties, business or financial condition of Lessee or (so far
as Lessee now can reasonably foresee) is likely materially and adversely to
affect the ability of Lessee to perform its obligations under this Second
Supplemental Participation Agreement or any other Operative Document or
Refinancing Document to which it is or will be a party or would affect the
legality, validity or enforceability of any of the Refinancing Documents.

 

Section 7.07. Regulation. By virtue of the execution, delivery and performance
of this Second Supplemental Participation Agreement and the other Operative
Documents or the Refinancing Documents by the parties hereto or thereto, based
upon the provisions of the Holding Company Act and the Federal Power Act and the
rules and regulations under each such Act and the laws of the State of Kansas
and Governmental Authorities thereof, as the foregoing are or were in effect on
the Funding Date and the Refinancing Date and without regard to any other
transactions to which Owner Trustee, Indenture Trustee or Owner Participant, or
any Affiliate of any thereof, was, is or will be a party and without regard to
any other ownership interests or business activities (other than their
respective interests in the Facility) of any thereof (and assuming that the
representations set forth in subsection 5.1.8 of the Existing Participation
Agreement are or were correct immediately prior to the closing on the
Refinancing Date and on the Funding Date and that the representations in Section
4.05 hereof are correct immediately prior to the Refinancing Date (but without
taking into account any assumption therein as to any representation by Lessee)
and, with respect to Owner Trustee and Owner Participant under clause (i) below,
assuming that each of Owner Participant and Owner Trustee has timely filed Form
U-7D within 30 days of the Funding Date and will file within 30 days of the
Refinancing Date an amendment thereto and meets and will meet the requirements
specified in 17 C.F.R. § 250.7(d)(l)(ii) under the Holding Company Act, and with
respect to Owner Trustee and Owner Participant, respectively, under clause (iii)
below, assuming that Owner Trustee is primarily engaged in the trust and banking
business and that Owner Participant is primarily engaged in the business of
finance, which may include the ownership of assets as a passive investor), none
of Owner Trustee, Indenture Trustee or Owner Participant will be or become,
prior to the Lessor Possession Date, by virtue of the execution, delivery or
performance of the Operative Documents or the Refinancing Documents:

 

(i) a “holding company” or a “subsidiary company” of a “holding company” or an
“affiliate” of a “subsidiary company” or “holding company” or “public utility”
within the meaning of the Holding Company Act or subject to the jurisdiction,
control or regulation of the Commission thereunder (other than, in the case of
Owner Participant and Owner Trustee, the timely filing of Form U-7D or any
subsequent amendment);

 

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(ii) a “public utility” within the meaning of the Federal Power Act or subject
to regulation under the Federal Power Act or subject to the jurisdiction,
control or regulation of the Federal Energy Regulatory Commission thereunder;

 

(iii) an “electric public utility” within the meaning of the laws of the State
of Kansas; subject to regulation as such (as to rates or the issuance of
securities) under any comparable law of the State of Kansas; or subject to the
jurisdiction, control or regulation of the KCC as an “electric public utility”;
or

 

(iv) subject to the jurisdiction, control or regulation by any other
Governmental Authority under any other Governmental Rules relating to electric
public utilities or the production, sale or transmission of electric energy.

 

Lessee is not a “holding company” or a “subsidiary company” of a “holding
company” or an “affiliate” of a “holding company” within the meaning of the
Holding Company Act which is required to register as such under the Holding
Company Act.

 

Lessee is not an “investment company” or a company “controlled” by an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended.

 

Section 7.08. No Default. As of the date hereof, no Lease Default or Lease Event
of Default has occurred and is continuing.

 

Section 7.09. No Event of Loss. As of the date hereof, no Event of Loss or event
which with the passage of time would constitute an Event of Loss has occurred.

 

Section 7.10. Filings and Recordings. The recordings listed on Schedule 8B
hereto, together with the filings and recordings shown on Schedule 8 to the
Existing Participation Agreement, are all the filings and recordings necessary
or advisable to perfect Owner Trustee’s right, title and interest in and to the
Leased Assets, and to perfect for the benefit of Indenture Trustee and the
holders of the Bonds, the first mortgage lien and first priority security
interest provided for in the Indenture, and all such filings and recordings will
have been duly made, subject to requirements for filing continuation statements
at appropriate intervals.

 

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ARTICLE 8

CONDITIONS PRECEDENT TO PARTICIPATION AND COMMITMENT ON THE REFINANCING DATE

 

The obligation of Owner Participant, Owner Trustee, Indenture Trustee, and
Lessee to consummate the transactions contemplated hereby on the Refinancing
Date shall, in each case, be subject to the fulfillment on or prior to the
Refinancing Date of the following conditions precedent (each instrument,
document, certificate or opinion referred to below to be in form and substance
satisfactory to the recipient) except that the obligations of any Person shall
not be subject to such Person’s own performance or compliance:

 

Section 8.01. Refinancing Documents. In the case of Owner Participant, Lessee,
Indenture Trustee, and Owner Trustee, such Persons shall have received executed
counterparts of this Second Supplemental Participation Agreement, the Second
Supplemental Indenture, the Lease Supplement and such other documents as are
contemplated hereby. All of the foregoing documents shall have been duly
authorized, executed and delivered by the parties hereto or thereto and shall be
in full force and effect on the Refinancing Date, and in the case of Owner
Participant, Lessee, Indenture Trustee, and Owner Trustee, each such Person
shall have received such evidence as to such authorization, execution and
delivery by the other parties hereto or thereto as such party shall reasonably
request.

 

Section 8.02. 2005 Series Bonds. On the Refinancing Date Owner Trustee shall
have executed and delivered the 2005 Series Bonds, duly authenticated, in a
principal amount of $320,000,000, and the 2005 Purchasers shall have purchased
the same.

 

Section 8.03. Filings and Recordings. In the case of Owner Participant,
Indenture Trustee, Owner Trustee and Lessee, financing statements under the
Uniform Commercial Code shall have been duly filed against Owner Trustee in
respect of the mortgage lien and security interests created by the Indenture in
all places reasonably specified by special counsel for the 2005 Purchasers as
being necessary or advisable to perfect and protect such security interests, and
all filing fees in respect thereof shall have been paid. The Lease Supplement
and the Second Supplemental Indenture shall have been duly recorded with the
applicable recorder’s offices of the county in which the Assets are located and
all recording and filing fees in respect thereof shall have been paid. In the
case of Owner Participant, Indenture Trustee, Lessee, and Owner Trustee, all
other filings, recordings or other actions reasonably specified by special
counsel for Owner Participant, Indenture Trustee or the 2005 Purchasers as being
necessary or advisable to perfect or protect the interests granted to Owner
Trustee or Indenture Trustee pursuant to any of the Refinancing Documents shall
have been duly effected and all filing and recording fees in respect thereof
shall have been paid.

 

22

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

Section 8.04. Representations and Warranties. With respect to Owner Participant,
Owner Trustee, Lessee, and Indenture Trustee, all of the representations and
warranties set forth above shall be true and correct on and as of the
Refinancing Date with the same effect as though made on and as of the
Refinancing Date, and each of Owner Participant, Owner Trustee, Lessee, and
Indenture Trustee shall have performed all of its covenants and agreements in
any Refinancing Document and the 2005 Purchase Agreement to be performed by it
or complied with by it on or before the Refinancing Date.

 

Section 8.05. Opinions. In the case of Owner Participant, Lessee, Owner Trustee
and Indenture Trustee, such Persons (other than the Person represented by the
following counsel) shall have received favorable opinions of Drinker Biddle &
Reath LLP, Owner Participant’s special counsel, Larry D. Irick, Esq., Lessee’s
general counsel, Davis Polk & Wardwell, Lessee’s special New York counsel,
Stinson Morrison Hecker LLP, Lessee’s special Kansas counsel, Shipman & Goodwin
LLP, Owner Trustee’s counsel and Seward & Kissel LLP, Indenture Trustee’s
counsel, each dated the Refinancing Date, addressed to such Persons, to the
effect of their respective opinions attached as Exhibit C hereto.

 

Section 8.06. No Default Certificates. In the case of Owner Participant, Owner
Trustee, and Indenture Trustee, such Persons shall have received an Officer’s
Certificate, dated the Refinancing Date, from Lessee stating that no Lease Event
of Default or Lease Default or Event of Loss or event which with the passage of
time would constitute an Event of Loss has occurred and is continuing and an
Owner Trustee’s Certificate, dated the Refinancing Date, stating that to its
knowledge no Indenture Default or Indenture Event of Default has occurred and is
continuing; and no such Lease Event of Default, Lease Default, Indenture Default
or Indenture Event of Default shall have occurred and be continuing.

 

Section 8.07. 1992 Series Bonds. An amount of money sufficient to pay the
Redemption Price of all the Outstanding 1992 Series Bonds shall have been
deposited with Indenture Trustee or the Paying Agent.

 

Section 8.08. Actions, Proceedings or Investigations. No action, proceeding or
investigation shall have been instituted nor shall any action before any court
or governmental authority or agency be threatened, nor shall any order, judgment
or decree have been issued or proposed to be issued by any court or governmental
authority or agency on or before the Refinancing Date to set aside, restrain,
enjoin or prevent the consummation of the transactions contemplated by the 2005
Purchase Agreement, the Registration Rights Agreement, the Lease, the Indenture
or this Second Supplemental Participation Agreement.

 

Section 8.09. Consents And Approvals. All approvals required to be taken, given
or obtained, as the case may be, by or from any Federal, state or other
governmental authority or agency, or by or from any trustee or holder of any

 

23

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

indebtedness or obligations of Lessee (including, without limitation, all such
approvals required by Section 17 of the Existing Participation Agreement, as
amended hereby), Owner Participant, Indenture Trustee, or Owner Trustee that are
necessary or, in the opinion of Lessee, such Owner Participant, or Owner Trustee
or their respective counsels, advisable in connection with the consummation of
the transactions contemplated hereby, shall have been duly taken, given or
obtained, as the case may be, shall be in full force and effect on the
Refinancing Date, and shall be adequate to authorize the consummation of the
transactions contemplated hereby and the performance by Lessee, Owner
Participant, Indenture Trustee, and Owner Trustee of their respective
obligations hereunder and under any Refinancing Document to which it is a party.

 

Section 8.10. Resolutions, Corporate Proceedings, etc. In the case of Owner
Participant, Owner Trustee, and Indenture Trustee, each such Person shall have
received the following, in each case in form and substance satisfactory to it:

 

(a) a copy of resolutions of the Board of Directors of Lessee, certified as of
the Refinancing Date by the Secretary or an Assistant Secretary thereof, duly
authorizing the execution, delivery and performance by Lessee of this Second
Supplemental Participation Agreement, the Lease Supplement, the 2005 Purchase
Agreement, the Registration Rights Agreement, and Second Supplemental Indenture,
together with an incumbency certificate as to the person or persons authorized
to execute and deliver such documents on its behalf; and

 

(b) such other documents and evidence with respect to Lessee, Owner Participant,
Owner Trustee or Indenture Trustee as counsel to the other parties hereto may
reasonably request in order to consummate the transactions contemplated hereby,
the taking of all corporate proceedings in connection therewith and compliance
with the conditions herein or therein set forth.

 

Section 8.11. Event of Loss. No Event of Loss shall have occurred.

 

Section 8.12. Taxes, Fees and Charges. All taxes, fees and other charges payable
in connection with the execution, delivery, recordation and filing of all the
documents and instruments referred to in this Second Supplemental Participation
Agreement and in connection with the issuance and sale of the 2005 Series Bonds
to be issued by Owner Trustee on the Refinancing Date shall have been paid in
full.

 

Section 8.13. Payment for Bonds and Refinancing Expenses. Owner Trustee shall
have applied the proceeds from the offering of the 2005 Series Bonds in
accordance with Section 2.01(c) hereof and each of Owner Trustee and Lessee
shall have made the respective payments required to be made by each of them
pursuant to Section 2.04 hereof.

 

24

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

Section 8.14. Consents, Authorizations and Instructions of Owner Participant.
Owner Participant shall have consented to and authorized and instructed Owner
Trustee (i) to execute and deliver the Second Supplemental Indenture and Lease
Supplement, substantially in the forms of Exhibits B and A attached hereto, (ii)
to execute and deliver the 2005 Series Bonds in the form attached to the Second
Supplemental Indenture, (iii) to execute and deliver the 2005 Purchase Agreement
and the Registration Rights Agreement and (iv) to take all other action
specified in this Second Supplemental Participation Agreement required to be
taken by Owner Trustee on the Refinancing Date to consummate the transactions
contemplated by this Second Supplemental Participation Agreement.

 

Section 8.15. Tax Opinion. Owner Participant shall have received from Drinker
Biddle & Reath LLP an opinion in form and substance of the draft opinion
relating to the matters described in subsection 17(b)(iii) of the Existing
Participation Agreement and delivered by such firm to Owner Participant on or
before the date of this Second Supplemental Participation Agreement (receipt of
which draft opinion is hereby acknowledged by Owner Participant as of the date
hereof).

 

Section 8.16. Compliance Certificate. In the case of Owner Participant and
Indenture Trustee, such Person shall have received Owner Trustee Certificates
required by Section 2.15(ii) and (v) and the Officers Certificates required by
Section 2.15(v) and (vi) of the Indenture.

 

Section 8.17. Lessee’s Performance. The representations and warranties of Lessee
set forth in Article 7 and in any other Refinancing Document to which Lessee is
or will be a party shall be true and correct on and as of the Refinancing Date
with the same effect as though made on and as of the Refinancing Date, Lessee
shall have performed all of the covenants and agreements in each Operative
Document and each Refinancing Document to which Lessee is or will be a party to
be performed by it on or before the Refinancing Date.

 

Section 8.18. Legality, etc. In the case of Owner Participant, Owner Trustee,
Indenture Trustee and Lessee, no change shall have occurred in applicable law,
or regulations thereunder or interpretations thereof, of or by appropriate
regulatory authorities that, in the opinion of such party or its counsel, would
make it illegal for such party to participate in any of the transactions
contemplated by the Operative Documents or the Refinancing Documents to which it
is or will be a party or subject such party to any material penalty or liability
or burdensome condition or regulation under or pursuant to any applicable law or
governmental regulation.

 

Section 8.19. Other Evidence. In the case of Owner Participant, Lessee, Owner
Trustee, and Indenture Trustee, each such Person shall have received such other
documents and certificates and opinions as such Person or its counsel shall
reasonably request.

 

25

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

ARTICLE 9

AGREEMENTS AND COVENANTS

 

The following agreements and covenants shall be effective as of the Refinancing
Date:

 

Section 9.01. Agreement Respecting Refinancing Documents. Each party hereto
hereby agrees that the transactions contemplated by the Refinancing Documents,
when consummated in accordance with the terms and conditions of the Refinancing
Documents, this Second Supplemental Participation Agreement, the 2005 Purchase
Agreement, the Registration Rights Agreement, and the documents attached hereto
(the form and substance of each of which is hereby approved) will comply with
the terms and conditions of Section 17 of the Existing Participation Agreement
other than as specifically provided for in the Refinancing Documents.

 

Section 9.02. Prepayment. Until after the fourth refunding of the Bonds by
Lessee pursuant to Section 17 of the Participation Agreement and so long as the
Lease shall not have been declared in default pursuant to subsection 17.1
thereof, Owner Participant shall not, and shall not allow Owner Trustee to,
prepay, redeem or refinance any Bonds, or deposit monies with Indenture Trustee
in accordance with clause (c) of Section 3.01 of the Indenture; and after any
such fourth refunding of the Bonds by Lessee pursuant to Section 17 of the
Participation Agreement and so long as the Lease shall not have been declared in
default pursuant to subsection 17.1 thereof, Owner Participant shall not, and
shall not allow Owner Trustee to, prepay, redeem or refinance any Bonds, or
deposit monies with Indenture Trustee in accordance with clause (c) of Section
3.01 of the Indenture without the prior written consent of Lessee, which consent
shall not be unreasonably withheld.

 

Section 9.03. Successor Owner Trustee. Owner Participant shall not appoint or
cause or allow to be appointed a successor to any Owner Trustee or an additional
or separate trustee under the Trust Agreement without giving or causing to be
given prior written notice of such appointment (including notification of the
principal place of business of each such successor, additional or separate
trustee) to Lessee and Indenture Trustee and without any such successor,
additional or separate trustee simultaneously with its assumption of duties in
such capacity, taking all actions necessary or as may be reasonably requested by
Indenture Trustee or (unless objected to by Indenture Trustee) Lessee
(including, without limitation, the filing of financing statements) in order to
establish, preserve, protect and perfect its good and marketable title to the
Assets and its

 

26

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

rights under the Operative Documents and the Refinancing Documents and, so long
as any Bonds are Outstanding, the valid first mortgage and prior perfected
security interest of Indenture Trustee in the Indenture Estate granted or
intended to be created under the Indenture and Indenture Trustee’s rights under
the Operative Documents and the Refinancing Documents, subject only to Permitted
Interest Liens, Permitted Project Liens, the Lien of the Westar Energy Indenture
and any Lien affecting Westar Energy’s assets.

 

Section 9.04. Trust Agreement. Prior to the Lease Termination Date, or, if
later, the release of the Lien of the Indenture on the Indenture Estate and the
full payment of principal of, premium (if any) and interest on the Bonds, Owner
Participant will not terminate or revoke, or consent to the termination or
revocation of, the Trust Agreement.

 

Section 9.05. Indemnity. The parties hereto confirm that any reference to
“Bonds” in subsection 14.1 of the Lease includes the 2005 Series Bonds.

 

Section 9.06. Continuation Statements. Prior to the release of the Lien of the
Indenture on the Indenture Estate and the full payment of principal of, premium
(if any) and interest on, the Bonds, Lessee shall file continuation statements
at periodic intervals with respect to the applicable financing statements filed
pursuant to Section 2.05 hereof to preserve and protect the perfection of the
mortgage lien and security interests created by the Indenture.

 

Section 9.07. Further Assurance. Owner Participant hereby covenants to cause and
authorizes and instructs Owner Trustee to, and Owner Trustee hereby agrees to,
execute and deliver any and all agreements, instruments, certificates and other
documents and take or cause to be taken any and all other actions that are
deemed reasonably necessary or desirable by Lessee to enable Lessee to perform
its obligations under the Registration Rights Agreement.

 

Section 9.08. Tax Indemnity Agreement. Owner Participant and Lessee hereby agree
that (i) Section 4(e) of the Tax Indemnity Agreement shall be deleted in its
entirety and shall be replaced with “(Intentionally omitted),” and (ii) clause
(iv) of Section 6 of the Tax Indemnity Agreement shall be deleted in its
entirety and shall be replaced with “(iv) A determination that the Lease is a
“second 467 rental agreement” within the meaning of Section 467(d) of the
Code;”. Owner Participant further agrees that notwithstanding any provision to
the contrary in the Tax Indemnity Agreement, no indemnity shall be payable by
Lessee to Owner Participant as a result of the representation previously set
forth in such Section 4(e) ceasing to be true or correct as of the Refinancing
Date.

 

27

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

ARTICLE 10

SURVIVAL OF REPRESENTATIONS AND WARRANTIES; BINDING EFFECT

 

Section 10.01. Survival. All agreements, representations, warranties and
indemnities contained in this Second Supplemental Participation Agreement and
the other Refinancing Documents and in any agreement, document or certificate
delivered pursuant hereto or thereto or in connection herewith or therewith,
shall survive and continue in effect following the execution and delivery of
this Second Supplemental Participation Agreement and the other Refinancing
Documents, and all such representations, warranties and indemnities shall
survive the termination of this Second Supplemental Participation Agreement.

 

Section 10.02. Binding Effect. All agreements, representations, warranties and
indemnities in this Second Supplemental Participation Agreement and the
Refinancing Documents and in any agreement, document or certificate delivered
concurrently with the execution of this Second Supplemental Participation
Agreement or the other Refinancing Documents or from time to time hereafter
shall bind the Person making the same and its successors and assigns and shall
inure to the benefit of each Person for whom made and its permitted successors
and assigns.

 

ARTICLE 11

NOTICES

 

All communications, notices and consents provided for in this Second
Supplemental Participation Agreement shall be given as provided in the Existing
Participation Agreement, as modified by Section 3.02 hereof.

 

ARTICLE 12

MISCELLANEOUS

 

Section 12.01. Consent and Direction to Owner Trustee. Owner Participant hereby
consents to and authorizes and instructs Owner Trustee to execute and deliver
this Second Supplemental Participation Agreement, the other Refinancing
Documents, the 2005 Purchase Agreement and the Registration Rights Agreement.

 

Section 12.02. Owner Trustee Request. Owner Trustee hereby requests that
Indenture Trustee execute the Supplemental Indenture and this paragraph
constitutes the Owner Trustee Request required by clause (i) of Section 2.15 of
the Indenture.

 

28

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

Section 12.03. Effect of Supplement. The parties hereto hereby confirm the terms
of the Existing Participation Agreement, as supplemented and amended hereby, and
declare and agree that the Existing Participation Agreement, as supplemented and
amended hereby, is in full force and effect.

 

Section 12.04. Execution. This Second Supplemental Participation Agreement may
be executed in any number of counterparts and by the different parties hereto on
separate counterparts, each of which, when so executed and delivered, shall be
an original, but all such counterparts shall together constitute but one and the
same instrument.

 

Section 12.05. Governing Law. This Second Supplemental Participation Agreement
has been negotiated and delivered in the State of New York and shall be governed
by, and be construed in accordance with, the laws of the State of New York
without regard to the principles of conflicts of law thereof.

 

Section 12.06. Amendments, Supplements, etc. Neither this Second Supplemental
Participation Agreement nor any of the terms hereof may be amended,
supplemented, waived or modified orally, but only by an instrument in writing
signed by the party against which enforcement of such change is sought.

 

Section 12.07. Headings. The headings of the sections and paragraphs of this
Second Supplemental Participation Agreement have been inserted for convenience
of reference only and shall in no way restrict or otherwise modify any of the
terms or provisions hereof.

 

29

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

IN WITNESS WHEREOF, the parties hereto have each caused this Second Supplemental
Participation Agreement to be duly executed as of the date first above written.

 

U.S. BANK NATIONAL ASSOCIATION,
not in its individual
capacity except to the extent expressly
provided herein but solely as Owner
Trustee pursuant to the Trust
Agreement

By:  

/S/    MICHAEL M. HOPKINS

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

Name:  

Michael M. Hopkins

Title:  

Vice President

DEUTSCHE BANK TRUST COMPANY
AMERICAS, not in its individual
capacity except to the extent expressly
provided herein but as Indenture
Trustee pursuant to the Indenture

By:  

/S/    SUSAN JOHNSON

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

Name:  

Susan Johnson

Title:  

Vice President

COMCAST MO FINANCIAL SERVICES, INC.

By:  

/S/    KENNETH MIKALAUSKAS

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

Name:   Kenneth Mikalauskas Title:  

Vice President-Finance

KANSAS GAS AND ELECTRIC COMPANY

By:  

/S/    MARK A. RUELLE

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

Name:  

Mark A. Ruelle

Title:  

Vice President and Treasurer

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

SCHEDULE 1

 

ASSUMPTIONS

 

Based on the assumptions set forth below, the Basic Rent installments are as
shown on Annex A hereto, Casualty Values are as shown on Annex B hereto,
Allocated Rents are as shown on Annex C hereto, Section 467 Loan Balances are as
shown on Annex D hereto, and Non-Recourse Debt Schedules are as shown on Annex E
hereto.

 

     Part I Funding Date    September 29, 1987; all debt and equity investments
in Purchase Price on the Funding Date 1992 Refinancing Date    September 29,
1992 Refinancing Date    June 30, 2005 Bonds   

Aggregate principal amount of Initial Series Bonds equal to 87% of Purchase
Price. Interest payable on each March 29 and September 29, commencing March 29,
1988 for Initial Series Bonds and March 29, 1993 for 1992 Series Bonds.

 

Initial Series Bonds:

 

(i)     With a Stated Maturity of Principal of March 29, 2003

 

a)      Aggregate principal amount equal to $104,199,000

 

b)      Interest Rate - 11.100%

 

c)      Average Life - 12.86 years

 

(ii)    With a Stated Maturity of Principal of March 29, 2016

 

a)      Aggregate principal amount equal to $236,928,000

 

b)      Interest Rate - 11.875%

 

c)      Average Life - 24.09 years

 

(in each case, on a 12 30-day month, 360-day year basis).

 

1992 Series Bonds:

(i)     With a Stated Maturity of Principal of September 29, 2003

 

a)      Aggregate principal amount equal to $102,773,000

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

    

b)      Interest Rate - 6.760%

 

c)      Average Life - 7.50 years

 

(ii)    With a Stated Maturity of Principal of September 29, 2007

 

a)      Aggregate principal amount equal to $86,275,000

 

b)      Interest Rate - 7.625%

 

c)      Average Life - 14.52 years

 

(iii)  With a Stated Maturity of Principal of March 29, 2016

 

a)      Aggregate principal amount equal to $152,079,000

 

b)      Interest Rate - 8.290%

 

c)      Average Life - 21.77 years

 

(in each case, on a 12 30-day month, 360-day year basis).

 

2005 Series Bonds:

 

With a Stated Maturity of Principal of March 29, 2021

 

a)      Aggregate principal amount equal to $320,000,000

 

b)      Interest Rate – 5.647%

 

c)      Average Life – 10.00 years

 

(in each case, on a 12 30-day months, 360-day year basis).

Allocation of Proceeds of

the 2005 Series Bonds

  

The $320,000,000 of proceeds from the issuance of the 2005 Series Bonds shall be
distributed as shown below:

 

a)      $238,354,000 retirement of the 1992 Series Bonds and $1,177,509 to pay a
portion of the accrued interest on the redeemed 1992 Series Bonds

 

b)      $12,093,311 Transaction Expenses

 

c)      $68,375,180 Additional Borrowing by the Owner Participant

 

Schedule 1-2

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

     Part II Transaction Expenses   

$7,639,706 of Purchase Price amortized over the Interim Lease Term and the Basic
Term with $2,627,197 to be expensed on September 29, 1992.

 

$3,300,000 amortized from the 1992 Refinancing Date to the final maturity date
of the 1992 Series Bonds

 

$12,093,311 amortized from the Refinancing Date to the final maturity date of
the 2005 Series Bonds

     Part III Purchase Price    $392,100,000 Tax Benefits (as a matter of
economics and subject to the verification described in subsection 4.10 of the
Lease)    39.95% rate of tax in 1987 and 34% thereafter; 100% of the Purchase
Price qualifying for 22.5 year ADR depreciation (150% declining balance
switching to straightline at the optimal point to a 10% salvage value, taking
into account a half-year election for the first year).      Interest deductions
on the Bonds available on an accrual basis. Basic Rent    Basic Rent deemed not
to be received prior to Basic Rent Payment Dates prior to June 30, 2005, and
thereafter deemed received as shown on Annex C hereto. Section 467 Loan   
Accounted for consistently with Annex D hereto. Owner Participant’s After-Tax
Yield    Computed on a monthly basis using the multiple investment sinking fund
method. Sinking Fund Re-Investment Rate    0%

Owner Participant’s Fiscal Year-End

 

Interest on Bonds

payable on Basic Lease

Commencement Date

  

December 31

 

 

Paid by Owner Participant

 

Schedule 1-3

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

Annex A to

Schedule 1

 

HYPOTHETICAL BASIC RENT

 

(1987 - 2029)

 

Basic Rent Payment Date

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

  

Advance/Arrears

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

   Percentage

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

 

Sep 29 1988

   Arrears    5.062648 %

Mar 29 1989

   Arrears    5.612253 %

Sep 29 1989

   Arrears    5.032145 %

Mar 29 1990

   Arrears    5.642618 %

Sep 29 1990

   Arrears    5.032145 %

Mar 29 1991

   Arrears    5.642618 %

Sep 29 1991

   Arrears    5.032145 %

Mar 29 1992

   Arrears    5.642618 %

Sep 29 1992

   Arrears    5.032145 %

Mar 29 1993

   Arrears    3.332475 %

Sep 29 1993

   Arrears    5.491415 %

Mar 29 1994

   Arrears    3.332475 %

Sep 29 1994

   Arrears    5.491415 %

Mar 29 1995

   Arrears    3.309528 %

Sep 29 1995

   Arrears    5.514285 %

Mar 29 1996

   Arrears    3.235015 %

Sep 29 1996

   Arrears    5.588798 %

Mar 29 1997

   Arrears    3.155467 %

Sep 29 1997

   Arrears    5.668346 %

Mar 29 1998

   Arrears    3.070541 %

Sep 29 1998

   Arrears    5.753272 %

Mar 29 1999

   Arrears    3.024741 %

Sep 29 1999

   Arrears    5.799072 %

Mar 29 2000

   Arrears    2.930979 %

Sep 29 2000

   Arrears    5.892834 %

Mar 29 2001

   Arrears    2.830880 %

Sep 29 2001

   Arrears    5.992933 %

Mar 29 2002

   Arrears    2.724015 %

Sep 29 2002

   Arrears    6.099798 %

Mar 29 2003

   Arrears    2.609926 %

Sep 29 2003

   Arrears    7.443642 %

Mar 29 2004

   Arrears    3.915896 %

Sep 29 2004

   Arrears    4.907917 %

Mar 29 2005

   Arrears    2.446547 %

Jun 30 2005

   Arrears    0.936557 %

Sep 29 2005

   Arrears    7.986701 %

Mar 29 2006

   Arrears    6.248281 %

 

Schedule 1-4

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

Basic Rent Payment Date

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

  

Advance/Arrears

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

   Percentage

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

 

Sep 29 2006

   Arrears    2.304310 %

Mar 29 2007

   Arrears    2.304310 %

Sep 29 2007

   Arrears    3.679916 %

Mar 29 2008

   Arrears    2.265470 %

Sep 29 2008

   Arrears    6.123120 %

Mar 29 2009

   Arrears    2.156549 %

Sep 29 2009

   Arrears    6.250480 %

Mar 29 2010

   Arrears    2.040957 %

Sep 29 2010

   Arrears    6.385641 %

Mar 29 2011

   Arrears    1.918285 %

Sep 29 2011

   Arrears    6.529081 %

Mar 29 2012

   Arrears    1.788099 %

Sep 29 2012

   Arrears    6.681307 %

Mar 29 2013

   Arrears    7.006913 %

Sep 29 2013

   Arrears    1.498685 %

Mar 29 2014

   Arrears    7.194140 %

Sep 29 2014

   Arrears    1.337874 %

Mar 29 2015

   Arrears    7.393196 %

Sep 29 2015

   Arrears    1.166902 %

Mar 29 2016

   Arrears    7.604830 %

Sep 29 2016

   Arrears    0.985127 %

Mar 29 2017

   Arrears    7.829836 %

Sep 29 2017

   Arrears    0.791867 %

Mar 29 2018

   Arrears    8.069058 %

Sep 29 2018

   Arrears    0.586395 %

Mar 29 2019

   Arrears    8.323397 %

Sep 29 2019

   Arrears    0.367941 %

Mar 29 2020

   Arrears    8.593805 %

Sep 29 2020

   Arrears    0.135684 %

Mar 29 2021

   Arrears    4.941199 %

Sep 29 2021

   Arrears    0.000000 %

Mar 29 2022

   Arrears    0.000000 %

Sep 29 2022

   Arrears    0.000000 %

Mar 29 2023

   Arrears    0.000000 %

Sep 29 2023

   Arrears    0.000000 %

Mar 29 2024

   Arrears    0.000000 %

Sep 29 2024

   Arrears    0.000000 %

Mar 29 2025

   Arrears    0.000000 %

Sep 29 2025

   Arrears    0.000000 %

Mar 29 2026

   Arrears    0.000000 %

Sep 29 2026

   Arrears    0.000000 %

Mar 29 2027

   Arrears    0.000000 %

Sep 29 2027

   Arrears    0.000000 %

 

Schedule 1-5

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

Basic Rent Payment Date

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

   Advance/Arrears

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

   Percentage

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

 

Mar 29 2028

   Arrears    0.000000 %

Sep 29 2028

   Arrears    0.000000 %

Mar 29 2029

   Arrears    0.000000 %

Sep 29 2029

   Arrears    0.000000 %

 

Schedule 1-6

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

Annex B to

Schedule 1

 

Casualty Values

 

Date

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

   Casualty Value

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

 

Mar 29 1988

   108.221100 %

Sep 29 1988

   109.354280 %

Mar 29 1989

   109.893610 %

Sep 29 1989

   110.952540 %

Mar 29 1990

   111.387250 %

Sep 29 1990

   112.379510 %

Mar 29 1991

   112.749290 %

Sep 29 1991

   113.678280 %

Mar 29 1992

   113.986080 %

Sep 29 1992

   117.362280 %

Mar 29 1993

   118.344860 %

Sep 29 1993

   117.158980 %

Mar 29 1994

   117.970440 %

Sep 29 1994

   116.625030 %

Mar 29 1995

   117.327500 %

Sep 29 1995

   115.827110 %

Mar 29 1996

   116.537000 %

Sep 29 1996

   114.898930 %

Mar 29 1997

   115.622960 %

Sep 29 1997

   113.843070 %

Mar 29 1998

   114.587610 %

Sep 29 1998

   112.661980 %

Mar 29 1999

   113.329570 %

Sep 29 1999

   111.233680 %

Mar 29 2000

   111.923020 %

Sep 29 2000

   109.668830 %

Mar 29 2001

   110.391530 %

Sep 29 2001

   107.971090 %

Mar 29 2002

   108.734500 %

Sep 29 2002

   106.146290 %

Mar 29 2003

   106.961100 %

Sep 29 2003

   102.990640 %

Mar 29 2004

   102.448880 %

Sep 29 2004

   100.845410 %

Mar 29 2005

   101.536660 %

 

Schedule 1-7

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

Annex B to

Schedule 1

 

Casualty Values

(Expressed as a percentage of Purchase Price)

 

(June 2005 to September 2029)

 

Date

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

  Percentage

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

    Lessor Loan
Balance

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

    Lessee Loan
Balance

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

    Net Casualty
Value due on
Termination

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

  Jun 30 2005   117.402587 %   0.9365570 %   0.000000 %   116.466030 %
Sep 29 2005   115.924025 %   5.6958240 %   0.000000 %   110.228201 % Mar 29 2006
  118.145428 %   12.0856460 %   0.000000 %   106.059782 % Sep 29 2006  
120.271742 %   14.6902845 %   0.000000 %   105.581457 % Mar 29 2007   109.815774
%   4.7555508 %   0.000000 %   105.060224 % Sep 29 2007   111.683323 %  
8.5536423 %   0.000000 %   103.129680 % Mar 29 2008   113.032416 %   10.4836660
%   0.000000 %   102.548750 % Sep 29 2008   114.960348 %   16.8673050 %  
0.000000 %   98.093043 % Mar 29 2009   104.847074 %   7.3630872 %   0.000000 %  
97.483987 % Sep 29 2009   106.567926 %   13.7965401 %   0.000000 %   92.771385 %
Mar 29 2010   107.274034 %   15.1309493 %   0.000000 %   92.143085 % Sep 29 2010
  109.053191 %   21.8925947 %   0.000000 %   87.160596 % Mar 29 2011   99.266858
%   12.7545792 %   0.000000 %   86.512279 % Sep 29 2011   100.844769 %  
19.6006116 %   0.000000 %   81.244158 % Mar 29 2012   100.945403 %   20.3676575
%   0.000000 %   80.577746 % Sep 29 2012   102.564519 %   27.5551003 %  
0.000000 %   75.009418 % Mar 29 2013   93.052848 %   24.0852178 %   0.000000 %  
68.967630 % Sep 29 2013   94.457310 %   26.1824206 %   0.000000 %   68.274889 %
Mar 29 2014   93.978053 %   32.0993514 %   0.000000 %   61.878701 % Sep 29 2014
  95.405565 %   34.2348942 %   0.000000 %   61.170671 % Mar 29 2015   86.117826
%   31.7187525 %   0.000000 %   54.399073 % Sep 29 2015   87.350326 %  
33.6738655 %   0.000000 %   53.676461 % Mar 29 2016   86.313062 %   39.8036387 %
  0.000000 %   46.509423 % Sep 29 2016   87.552812 %   41.7778862 %   0.000000 %
  45.774926 % Mar 29 2017   78.442618 %   40.2531415 %   0.000000 %   38.189476
% Sep 29 2017   79.493147 %   42.0452988 %   0.000000 %   37.447848 % Mar 29
2018   76.864056 %   47.4339751 %   0.000000 %   29.430081 % Sep 29 2018  
77.896550 %   49.1991046 %   0.000000 %   28.697445 % Mar 29 2019   67.141536 %
  46.9033331 %   0.000000 %   20.238203 % Sep 29 2019   67.967297 %   48.4368219
%   0.000000 %   19.530475 % Mar 29 2020   64.767573 %   54.1561804 %   0.000000
%   10.611392 % Sep 29 2020   65.573825 %   55.6376452 %   0.000000 %   9.936180
% Mar 29 2021   54.930056 %   50.4572245 %   0.000000 %   4.472831 % Sep 29 2021
  55.548905 %   51.7110865 %   0.000000 %   3.837819 %

 

Schedule 1-8

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

Mar 29 2022   51.821333 %   48.5951309 %   0.000000 %   3.226202 % Sep 29 2022  
46.723331 %   44.0806375 %   0.000000 %   2.642694 % Mar 29 2023   47.263130 %  
45.1760414 %   0.000000 %   2.087089 % Sep 29 2023   39.989084 %   38.4249953 %
  0.000000 %   1.564089 % Mar 29 2024   40.453181 %   39.3798564 %   0.000000 %
  1.073325 % Sep 29 2024   33.104743 %   32.4847751 %   0.000000 %   0.619968 %
Mar 29 2025   33.495864 %   33.2920218 %   0.000000 %   0.203842 % Sep 29 2025  
26.245658 %   26.2456578 %   0.000000 %   0.000000 % Mar 29 2026   26.897862 %  
26.8978624 %   0.000000 %   0.000000 % Sep 29 2026   19.692604 %   19.6926035 %
  0.000000 %   0.000000 % Mar 29 2027   20.181965 %   20.1819647 %   0.000000 %
  0.000000 % Sep 29 2027   12.809816 %   12.8098158 %   0.000000 %   0.000000 %
Mar 29 2028   13.128140 %   13.1281397 %   0.000000 %   0.000000 % Sep 29 2028  
5.580703 %   5.5807033 %   0.000000 %   0.000000 % Mar 29 2029   5.719384 %  
5.7193837 %   0.000000 %   0.000000 % Sep 29 2029   0.000000 %   0.0000000 %  
0.000000 %   0.000000 %

 

Schedule 1-9

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

Annex C to

Schedule 1

 

Allocated Rent

(Expressed as a percentage of Purchase Price)

 

Lease Period

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

      From (and
including)

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

 

To

(and excluding)

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

  Allocated Rent

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

  Jun 30 2005   Sep 29 2005   3.238942 % Sep 29 2005   Mar 29 2006   0.000000 %
Mar 29 2006   Sep 29 2006   0.000000 % Sep 29 2006   Mar 29 2007   12.604097 %
Mar 29 2007   Sep 29 2007   0.000000 % Sep 29 2007   Mar 29 2008   0.548004 %
Mar 29 2008   Sep 29 2008   0.000000 % Sep 29 2008   Mar 29 2009   12.079919 %
Mar 29 2009   Sep 29 2009   0.000000 % Sep 29 2009   Mar 29 2010   1.049392 %
Mar 29 2010   Sep 29 2010   0.000000 % Sep 29 2010   Mar 29 2011   11.600331 %
Mar 29 2011   Sep 29 2011   0.000000 % Sep 29 2011   Mar 29 2012   1.508128 %
Mar 29 2012   Sep 29 2012   0.000000 % Sep 29 2012   Mar 29 2013   11.161540 %
Mar 29 2013   Sep 29 2013   0.000000 % Sep 29 2013   Mar 29 2014   1.927842 %
Mar 29 2014   Sep 29 2014   0.000000 % Sep 29 2014   Mar 29 2015   10.760075 %
Mar 29 2015   Sep 29 2015   0.000000 % Sep 29 2015   Mar 29 2016   2.311852 %
Mar 29 2016   Sep 29 2016   0.000000 % Sep 29 2016   Mar 29 2017   10.392761 %
Mar 29 2017   Sep 29 2017   0.000000 % Sep 29 2017   Mar 29 2018   3.725208 %
Mar 29 2018   Sep 29 2018   0.000000 % Sep 29 2018   Mar 29 2019   11.841766 %
Mar 29 2019   Sep 29 2019   0.000000 % Sep 29 2019   Mar 29 2020   4.078102 %
Mar 29 2020   Sep 29 2020   0.000000 % Sep 29 2020   Mar 29 2021   11.504215 %
Mar 29 2021   Sep 29 2021   0.000000 % Sep 29 2021   Mar 29 2022   4.400976 %
Mar 29 2022   Sep 29 2022   5.722082 %

 

Schedule 1-10

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

Lease Period

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

      Sep 29 2022   Mar 29 2023   0.000000 % Mar 29 2023   Sep 29 2023  
7.873671 % Sep 29 2023   Mar 29 2024   0.000000 % Mar 29 2024   Sep 29 2024  
7.873671 % Sep 29 2024   Mar 29 2025   0.000000 % Mar 29 2025   Sep 29 2025  
7.873671 % Sep 29 2025   Mar 29 2026   0.000000 % Mar 29 2026   Sep 29 2026  
7.873671 % Sep 29 2026   Mar 29 2027   0.000000 % Mar 29 2027   Sep 29 2027  
7.873671 % Sep 29 2027   Mar 29 2028   0.000000 % Mar 29 2028   Sep 29 2028  
7.873671 % Sep 29 2028   Mar 29 2029   0.000000 % Mar 29 2029   Sep 29 2029  
5.861510 %

 

Schedule 1-11

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

Annex D to

Schedule 1

 

Section 467 Loan Balances

(Expressed as a percentage of Purchase Price)

 

Date

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

 

(a)

Lessor Loan
Balance

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

   

(b)

Lessee Loan
Balance

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

   

(c)

Interest Amount

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

  Jun 30 2005   0.936557 %   0.000000 %   0.000000 % Sep 29 2005   5.695824 %  
0.000000 %   0.011507 % Mar 29 2006   12.085646 %   0.000000 %   0.141541 % Sep
29 2006   14.690284 %   0.000000 %   0.300328 % Mar 29 2007   4.755551 %  
0.000000 %   0.365054 % Sep 29 2007   8.553642 %   0.000000 %   0.118175 % Mar
29 2008   10.483666 %   0.000000 %   0.212558 % Sep 29 2008   16.867305 %  
0.000000 %   0.260519 % Mar 29 2009   7.363087 %   0.000000 %   0.419153 % Sep
29 2009   13.796540 %   0.000000 %   0.182973 % Mar 29 2010   15.130949 %  
0.000000 %   0.342844 % Sep 29 2010   21.892595 %   0.000000 %   0.376004 % Mar
29 2011   12.754579 %   0.000000 %   0.544031 % Sep 29 2011   19.600612 %  
0.000000 %   0.316951 % Mar 29 2012   20.367657 %   0.000000 %   0.487075 % Sep
29 2012   27.555100 %   0.000000 %   0.506136 % Mar 29 2013   24.085218 %  
0.000000 %   0.684744 % Sep 29 2013   26.182421 %   0.000000 %   0.598518 % Mar
29 2014   32.099351 %   0.000000 %   0.650633 % Sep 29 2014   34.234894 %  
0.000000 %   0.797669 % Mar 29 2015   31.718753 %   0.000000 %   0.850737 % Sep
29 2015   33.673865 %   0.000000 %   0.788211 % Mar 29 2016   39.803639 %  
0.000000 %   0.836796 % Sep 29 2016   41.777886 %   0.000000 %   0.989120 % Mar
29 2017   40.253142 %   0.000000 %   1.038180 % Sep 29 2017   42.045299 %  
0.000000 %   1.000291 % Mar 29 2018   47.433975 %   0.000000 %   1.044826 % Sep
29 2018   49.199105 %   0.000000 %   1.178734 % Mar 29 2019   46.903333 %  
0.000000 %   1.222598 % Sep 29 2019   48.436822 %   0.000000 %   1.165548 % Mar
29 2020   54.156180 %   0.000000 %   1.203655 % Sep 29 2020   55.637645 %  
0.000000 %   1.345781 % Mar 29 2021   50.457225 %   0.000000 %   1.382595 % Sep
29 2021   51.711087 %   0.000000 %   1.253862 % Mar 29 2022   48.595131 %  
0.000000 %   1.285020 %

 

Schedule 1-12

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

Sep 29 2022   44.080638 %   0.000000 %   1.207589 % Mar 29 2023   45.176041 %  
0.000000 %   1.095404 % Sep 29 2023   38.424995 %   0.000000 %   1.122625 % Mar
29 2024   39.379856 %   0.000000 %   0.954861 % Sep 29 2024   32.484775 %  
0.000000 %   0.978589 % Mar 29 2025   33.292022 %   0.000000 %   0.807247 % Sep
29 2025   26.245658 %   0.000000 %   0.827307 % Mar 29 2026   26.897862 %  
0.000000 %   0.652205 % Sep 29 2026   19.692604 %   0.000000 %   0.668412 % Mar
29 2027   20.181965 %   0.000000 %   0.489361 % Sep 29 2027   12.809816 %  
0.000000 %   0.501522 % Mar 29 2028   13.128140 %   0.000000 %   0.318324 % Sep
29 2028   5.580703 %   0.000000 %   0.326234 % Mar 29 2029   5.719384 %  
0.000000 %   0.138680 % Sep 29 2029   0.000000 %   0.000000 %   0.142127 %

 

Schedule 1-13

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

Annex E to

Schedule 1

 

All Non-Recourse Debt Schedules

(1987 – 2021)

 

Non-Recourse Debt Service Schedule

(September 1987 - March 1988)

 

Loan 6 Amortization    Interest Rate 11.63827%

Average Life 0.50000 Years; Duration 0.50000 Years

 

Date

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

        Draw Down

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

   Debt Service

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

   Interest

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

   Principal

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

   Balance

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

Sep 29 1987

        341,127,000.00                   341,127,000.00

Mar 29 1988

   1         360,977,644.51    19,850,644.51    341,127,000.00    0          

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

  

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

  

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

  

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

    

Totals

        341,127,000.00    360,977,644.51    19,850,644.51    341,127,000.00     

 

Non-Recourse Debt Service Schedule

(March 1988 - September 1992)

 

Loan 1 Amortization Interest Rate 11.10000%

Average Life 4.42761 Years; Duration 3.60538 Years

 

Date

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

        Draw Down

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

   Debt Service

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

   Interest

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

   Principal

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

   Balance

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

Mar 29 1988

        104,199,000.00                   104,199,000.00

Sep 29 1988

   1         5,783,044.50    5,783,044.50    0    104,199,000.00

Mar 29 1989

   2         7,938,044.50    5,783,044.50    2,155,000.00    102,044,000.00

Sep 29 1989

   3         5,663,442.00    5,663,442.00    0    102,044,000.00

Mar 29 1990

   4         5,663,442.00    5,663,442.00    0    102,044,000.00

Sep 29 1990

   5         5,663,442.00    5,663,442.00    0    102,044,000.00

Mar 29 1991

   6         5,663,442.00    5,663,442.00    0    102,044,000.00

Sep 29 1991

   7         5,663,442.00    5,663,442.00    0    102,044,000.00

Mar 29 1992

   8         5,663,442.00    5,663,442.00    0    102,044,000.00

Sep 29 1992

   9         107,707,442.00    5,663,442.00    102,044,000.00    0          

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

  

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

  

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

  

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

    

Totals

        104,199,000.00    155,409,183.00    51,210,183.00    104,199,000.00     

 

Schedule 1-14

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

Non-Recourse Debt Service Schedule

(March 1988 - September 1992)

 

Loan 2 Amortization    Interest Rate 11.87500%

Average Life 4.50000 Years; Duration 3.61259 Years

 

Date

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

        Draw Down

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

   Debt Service

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

   Interest

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

   Principal

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

   Balance

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

Mar 29 1988

        236,928,000.00                   236,928,000.00

Sep 29 1988

   1         14,067,600.00    14,067,600.00    0    236,928,000.00

Mar 29 1989

   2         14,067,600.00    14,067,600.00    0    236,928,000.00

Sep 29 1989

   3         14,067,600.00    14,067,600.00    0    236,928,000.00

Mar 29 1990

   4         14,067,600.00    14,067,600.00    0    236,928,000.00

Sep 29 1990

   5         14,067,600.00    14,067,600.00    0    236,928,000.00

Mar 29 1991

   6         14,067,600.00    14,067,600.00    0    236,928,000.00

Sep 29 1991

   7         14,067,600.00    14,067,600.00    0    236,928,000.00

Mar 29 1992

   8         14,067,600.00    14,067,600.00    0    236,928,000.00

Sep 29 1992

   9         250,995,600.00    14,067,600.00    236,928,000.00    0          

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

  

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

  

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

  

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

    

Totals

        236,928,000.00    363,536,400.00    126,608,400.00    236,928,000.00   
 

 

Non-Recourse Debt Service Schedule

(September 1992 - June 2005)

Combined Tranches of the 1992 Series Bonds

 

Loan 3 Amortization    IRR of Debt Services 7.75724%

Average Life 11.17010 Years; Duration 7.54068 Years

 

Date

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

        Draw Down

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

   Debt Service

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

   Interest

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

   Principal

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

   Balance

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

Sep 29 1992

        341,127,000.00                   341,127,000.00

Mar 29 1993

   1         13,066,636.32    13,066,636.32    0.00    341,127,000.00

Sep 29 1993

   2         13,066,636.32    13,066,636.32    0.00    341,127,000.00

Mar 29 1994

   3         13,066,636.32    13,066,636.32    0.00    341,127,000.00

Sep 29 1994

   4         15,728,636.33    13,066,636.32    2,662,000.00    338,465,000.00

Mar 29 1995

   5         12,976,660.72    12,976,660.72    0.00    338,465,000.00

Sep 29 1995

   6         21,620,660.73    12,976,660.72    8,644,000.00    329,821,000.00

 

Schedule 1-15

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

Mar 29 1996

   7         12,684,493.52    12,684,493.52    0.00    329,821,000.00

Sep 29 1996

   8         21,912,493.52    12,684,493.52    9,228,000.00    320,593,000.00

Mar 29 1997

   9         12,372,587.12    12,372,587.12    0.00    320,593,000.00

Sep 29 1997

   10         22,224,587.12    12,372,587.12    9,852,000.00    310,741,000.00

Mar 29 1998

   11         12,039,589.52    12,039,589.52    0.00    310,741,000.00

Sep 29 1998

   12         17,352,589.52    12,039,589.52    5,313,000.00    305,428,000.00

Mar 29 1999

   13         11,860,010.12    11,860,010.12    0.00    305,428,000.00

Sep 29 1999

   14         22,737,010.12    11,860,010.12    10,877,000.00    294,551,000.00

Mar 29 2000

   15         11,492,367.52    11,492,367.52    0.00    294,551,000.00

Sep 29 2000

   16         23,104,367.52    11,492,367.52    11,612,000.00    282,939,000.00

Mar 29 2001

   17         11,099,881.93    11,099,881.92    0.00    282,939,000.00

Sep 29 2001

   18         23,496,881.93    11,099,881.92    12,397,000.00    270,542,000.00

Mar 29 2002

   19         10,680,863.32    10,680,863.32    0.00    270,542,000.00

Sep 29 2002

   20         23,915,863.32    10,680,863.32    13,235,000.00    257,307,000.00

Mar 29 2003

   21         10,233,520.32    10,233,520.32    0.00    257,307,000.00

Sep 29 2003

   22         29,186,520.32    10,233,520.32    18,953,000.00    238,354,000.00

Mar 29 2004

   23         9,592,908.93    9,592,908.92    0.00    238,354,000.00

Sep 29 2004

   24         9,592,908.93    9,592,908.92    0.00    238,354,000.00

Mar 29 2005

   25         9,592,908.93    9,592,908.92    0.00    238,354,000.00

Jun 30 2005

   26         243,203,748.40    4,849,748.40    238,354,000.00    0.00          

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

  

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

  

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

  

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

    

Totals

        341,127,000.00    637,901,968.73    296,774,968.73    341,127,000.00   
 

Non-Recourse Debt Service Schedule

(June 2005 - March 2021)

Loan 4 Amortization Interest Rate 5.64700%

Average Life 10.00000 Years; Duration 7.53635 Years

Date

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

        Draw Down

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

   Debt Service

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

   Interest

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

   Principal

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

   Balance

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

Jun 30 2005

        320,000,000.00                   320,000,000.00

Sep 29 2005

   1         4,467,404.44    4,467,404.44    0    320,000,000.00

Mar 29 2006

   2         9,035,200.00    9,035,200.00    0    320,000,000.00

Sep 29 2006

   3         9,035,200.00    9,035,200.00    0    320,000,000.00

Mar 29 2007

   4         9,035,200.00    9,035,200.00    0    320,000,000.00

Sep 29 2007

   5         14,428,951.27    9,035,200.00    5,393,751.27    314,606,248.73

Mar 29 2008

   6         8,882,907.43    8,882,907.43    0    314,606,248.73

Sep 29 2008

   7         24,008,753.06    8,882,907.43    15,125,845.63    299,480,403.10

 

Schedule 1-16

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

Mar 29 2009

   8         8,455,829.18    8,455,829.18    0    299,480,403.10

Sep 29 2009

   9         24,508,132.86    8,455,829.18    16,052,303.68    283,428,099.43

Mar 29 2010

   10         8,002,592.39    8,002,592.39    0    283,428,099.43

Sep 29 2010

   11         25,038,099.66    8,002,592.39    17,035,507.28    266,392,592.15

Mar 29 2011

   12         7,521,594.84    7,521,594.84    0    266,392,592.15

Sep 29 2011

   13         25,600,526.94    7,521,594.84    18,078,932.10    248,313,660.05

Mar 29 2012

   14         7,011,136.19    7,011,136.19    0    248,313,660.05

Sep 29 2012

   15         26,197,402.88    7,011,136.19    19,186,266.69    229,127,393.37

Mar 29 2013

   16         27,474,106.24    6,469,411.95    21,004,694.28    208,122,699.08

Sep 29 2013

   17         5,876,344.41    5,876,344.41    0    208,122,699.08

Mar 29 2014

   18         28,208,221.18    5,876,344.41    22,331,876.77    185,790,822.31

Sep 29 2014

   19         5,245,803.87    5,245,803.87    0    185,790,822.31

Mar 29 2015

   20         28,988,721.21    5,245,803.87    23,742,917.34    162,047,904.97

Sep 29 2015

   21         4,575,422.60    4,575,422.60    0    162,047,904.97

Mar 29 2016

   22         29,818,537.17    4,575,422.60    25,243,114.57    136,804,790.40

Sep 29 2016

   23         3,862,683.26    3,862,683.26    0    136,804,790.40

Mar 29 2017

   24         30,700,785.08    3,862,683.26    26,838,101.82    109,966,688.58

Sep 29 2017

   25         3,104,909.45    3,104,909.45    0    109,966,688.58

Mar 29 2018

   26         31,638,777.86    3,104,909.45    28,533,868.41    81,432,820.17

Sep 29 2018

   27         2,299,255.68    2,299,255.68    0    81,432,820.17

Mar 29 2019

   28         32,636,037.76    2,299,255.68    30,336,782.08    51,096,038.08

Sep 29 2019

   29         1,442,696.64    1,442,696.64    0    51,096,038.08

Mar 29 2020

   30         33,696,309.56    1,442,696.64    32,253,612.93    18,842,425.16

Sep 29 2020

   31         532,015.87    532,015.87    0    18,842,425.16

Mar 29 2021

   32         19,374,441.03    532,015.87    18,842,425.16    0          

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

  

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

  

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

  

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

    

Totals

        320,000,000.00    500,704,000.00    180,704,000.00    320,000,000.00   
 

 

Schedule 1-17

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

SCHEDULE 2

 

LITIGATION

 

None, except as described in the Annual Report of Lessee for fiscal year ended
December 31, 2004 filed with the Commission on Form 10-K, including the
documents incorporated therein by reference.

 

Schedule 2-1

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

SCHEDULE 3

 

DEFAULTS

 

None

 

Schedule 3-1

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

SCHEDULE 8B

 

ADDITIONAL FILINGS AND RECORDINGS KANSAS

 

Document

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

  

Filing or Recording

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

    

Linn County

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

  

Secretary of State

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

Amendment No. 4 to Lease Agreement

   File for Record     

Amendment No. 1 to Sublease

   File for Record     

Amendment No. 1 to Ground Lease

   File for Record     

Second Supplemental Indenture

   File for Record          

UCC-1 financing statement (fixture

filing) to be filed in Linn County

   UCC-3 financing statement, amending the UCC-1 financing statement filed with
the Secretary of State of the State of Kansas

 

OHIO

 

Filing

 

Secretary of State

 

(a) UCC-1 financing statement*, naming the original settlor U.S. West Financial
Services, Inc. (as predecessor in interest to Comcast MO Financial Services,
Inc.) as the debtor and Bankers Trust Company (as predecessor in interest to
Deutsche Bank Trust Company Americas), as Indenture Trustee, as the secured
party.

 

(b) UCC-3 financing statement*, amending the UCC-1 financing statement referred
to in (a) above by adding a trust named “Kansas Gas and Electric Company” as an
additional debtor.

 

Schedule 8B-1

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

(c) UCC-3 financing statement, further amending the UCC-1 financing statement
referred to in (a) above, as amended by UCC-3 financing statement referred to in
(b) above, by substituting “La Cygne Unit 2 Assets Trust” for U.S. West
Financial Services, Inc. and Kansas Gas and Electric Company as the debtor and
substituting Deutsche Bank Trust Company Americas, as Indenture Trustee, for
Bankers Trust Company, as Indenture Trustee, as the secured party.

 

(d) UCC-1 financing statement, naming the La Cygne Unit 2 Assets Trust as the
debtor, U.S. Bank National Association, as Owner Trustee, as an additional
debtor, and Deutsche Bank Trust Company Americas, as Indenture Trustee, as the
secured party.

 

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

* Already filed for the record

 

Schedule 8B-2

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

SCHEDULE 10

 

    

ADDRESSES FOR NOTICES

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

OWNER PARTICIPANT:

  

Comcast MO Financial Services, Inc.

c/o Comcast Corporation

1500 Market Street

Philadelphia, PA 19102

Attention: General Counsel

OWNER TRUSTEE:

  

U.S. Bank National Association

225 Asylum Street, 23rd Floor

Hartford, CT 06103

Attention: Corporate Trust Services

INDENTURE TRUSTEE:

  

Deutsche Bank Trust Company Americas

60 Wall Street, 27th Floor

New York, NY 10005

Attention: Head of Global Debt

Services/Trust and Securities Services

LESSEE:

  

Kansas Gas and Electric Company

c/o Westar Energy, Inc.

818 Kansas Avenue

Topeka, Kansas 66612 Attention: Secretary and General Counsel

 

Schedule 10-1

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

Exhibit A

 

Lease Supplement

 

Exhibit A-1

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

Exhibit B

 

Second Supplemental Indenture

 

Exhibit B-1

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

Exhibit C

 

Opinions

 

Exhibit C-1