exv10w1



 




Exhibit 10.1






EXECUTION COPY




FIRST AMENDMENT TO




AMENDED AND RESTATED CREDIT AGREEMENT




     This First Amendment, dated as of May 15, 2006 (this “Amendment”), supplements and amends the
Amended and Restated Credit Agreement, dated as of December 9, 2005 (as amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”), among Pinnacle West
Capital Corporation, as Borrower, the Lenders from time to time party thereto, JPMorgan Chase Bank,
National Association, as Agent, and the other agents party thereto. Capitalized terms used herein
and not otherwise defined shall have the meanings given to them in the Credit Agreement.



     WHEREAS, on April 17, 2006, the Federal Energy Regulatory Commission (“FERC”) issued an Order
on Updated Market Power Analysis and Revoking Market-Based Rate Authority in Pinnacle West Capital
Corp., et al., 115 FERC ¶61,055 (2006), revoking the Borrower’s market-based rate authority under
the Federal Power Act (the “FPA”) in the APS control area and prior waivers and authorizations
granted in connection with that market-based rate authority;



     WHEREAS, the applicable waivers and authorizations previously granted to the Borrower and so
revoked include blanket authorization for issuances of securities or assumptions of liability under
the FPA;



     WHEREAS, on April 20, 2006, the Borrower filed with the FERC an Application for Authorization
to Issue Securities, Waivers, and Expedited Consideration under Section 204 of the FPA, seeking
authorization for borrowings under the Credit Agreement and for the issuance of certain other
securities and on May 3, 2006, the FERC issued an order under Section 204 of the FPA, 115 FERC
¶62,134 (2006), granting conditional authorization for borrowings under the Credit Agreement
through June 30, 2008 and for the issuance of certain other securities; and



     WHEREAS, as a result of these events, the Borrower has requested the Lenders to amend certain
of the representations and warranties of the Borrower under the Credit Agreement.



     WHEREAS, the Lenders executing this Amendment and the Agent are willing to amend the Credit
Agreement on the terms and conditions set forth herein.



     NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set forth herein
and the undertakings herein set forth and intending to be legally bound, the parties hereto agree
as follows:



          1. Amendments to the Credit Agreement. Effective as of the date first above written,
and subject to the satisfaction of the conditions to effectiveness set forth in Section 3
below, the Credit Agreement is hereby amended as follows:





	 	1.1.	 	Amendments to Section 1.1 of the Credit Agreement. New definitions are hereby
added to Section 1.1 of the Credit Agreement in the appropriate alphabetical order to
read as follows:




 









 












     “FERC” means the Federal Energy Regulatory Commission or any successor agency under the
FPA.




     “FPA” means the Federal Power Act, as amended, or any successor statute thereto.




     “May 2006 Letter Order” means that certain letter order issued by the FERC under
Section 204 of the FPA on May 3, 2006, Pinnacle West Capital Corporation, 115 FERC ¶62,134
(2006).




     “Section 204 Authorization Expiration Date” shall mean the date on which FERC
authorization under Section 204 of the FPA for the Borrower to issue securities and assume
liabilities under the Credit Agreement shall expire. The Section 204 Authorization
Expiration Date as established in the May 2006 Letter Order is June 30, 2008, but the
Section 204 Authorization Expiration Date shall be such later date as the FERC may establish
in a subsequent order under Section 204 of the FPA authorizing the Borrower to issue
securities and assume liabilities under the Credit Agreement, a copy of which the Borrower
shall provide to the Agent, together with such opinion letters of counsel and other
information as the Agent shall reasonably request.




     “Section 204(e) Power” means the right of a public utility under Section 204(e) of the
FPA to issue or renew the issuance of short-term debt securities or assume liabilities with
respect to short-term debt securities without FERC approval under Section 204(a) of the FPA.




	 	1.2.	 	Amendment to Section 2.2 of the Credit Agreement. The following
language is hereby added to the end of Section 2.2 of the Credit Agreement:






     Notwithstanding anything to the contrary in this Article II or in any Note, unless (i)
the Borrower shall not be subject to FERC regulation under Section 204 of the FPA, or (ii)
all necessary approvals of the FERC under Section 204 of the FPA for the Borrower to issue
securities and assume liabilities under the Credit Agreement from and after the Section 204
Authorization Expiration Date have been obtained and provided to the Agent, together with
such opinion letters of counsel and other information as the Agent shall reasonably request,
(a) after the Section 204 Authorization Expiration Date, the Borrower shall not request, nor
shall any Lender be required to make, any Credit Extension in respect of which FERC
authorization under Section 204 of the FPA would be required, and (b) for the period
commencing on the day after the Section 204 Authorization Expiration Date and thereafter, if
and to the extent that any Credit Extension is made in reliance on the Section 204(e) Power
as provided in the last sentence of Section 5.11 hereof, for a period of at least one
Business Day during any 364-day period, the principal amount of all outstanding Advances
hereunder shall be zero.




	 	1.3.	 	Amendment to Section 5.2 of the Credit Agreement. The following
language is hereby added to the end of Section 5.2 of the Credit Agreement:




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     It is acknowledged that pursuant to the May 2006 Letter Order the Borrower shall be
required to make filings with the FERC as required under 18 C.F.R. § 34.10 and § 131.43.




	 	1.4.	 	Amendments to Section 5.11 of the Credit Agreement. (i) The phrase
“the Federal Energy Regulatory Commission (“FERC”)” now appearing in the third
sentence of Section 5.11 of the Credit Agreement is deleted and the following is
substituted therefor: “FERC”; and (ii) the last two sentences of Section 5.11 of the
Credit Agreement are hereby amended in their entirety to read as follows:






The Borrower is a “public utility” within the meaning of the FPA, and is subject to FERC
regulation under the FPA, provided that upon the delivery to the Agent and the Lenders of a
certificate of an Authorized Officer of the Borrower stating that the Borrower is no longer
a “public utility” under the FPA, the foregoing representation shall no longer be operative.
Except as provided in the next sentence below, to the extent required under the FPA, the
Borrower has obtained authority from the FERC under Section 204 of the FPA to issue
securities and assume liabilities under the Credit Agreement, and such authorization remains
in full force and effect. After the Section 204 Authorization Expiration Date, to the
extent that the Borrower remains subject to regulation under Section 204 of the FPA and all
necessary approvals of the FERC under Section 204 of the FPA to issue securities and assume
liabilities under the Credit Agreement from and after the Section 204 Authorization
Expiration Date, have not then been obtained and provided to the Agent, together with such
opinion letters of counsel and other information as the Agent shall reasonably request,
Credit Extensions may be made under this Agreement solely pursuant to the Section 204(e)
Power to the extent the Section 204(e) Power shall be applicable to the Borrower.




	 	1.5.	 	Amendments to Section 6.1 of the Credit Agreement. (i) The following
new subsections 6.1.10 and 6.1.11 to the Credit Agreement shall be inserted immediately
following subsection 6.1.9 now appearing therein:






     6.1.10. Promptly, and in any event within five (5) Business Days after the occurrence
thereof, notice of (i) any change to or revocation of any applicable waiver or authorization
previously granted to the Borrower under Section 204 of the FPA to issue securities and
assume liabilities under the Credit Agreement, (ii) the issuance of any applicable waiver or
authorization granted to the Borrower under Section 204 of the FPA to issue securities and
assume liabilities under the Credit Agreement, and (iii) the Borrower not being subject to
FERC regulation under the FPA.




     6.1.11. Promptly, and in any event within five (5) Business Days after an Authorized
Officer obtains knowledge thereof, notice of any breach of the Borrower’s obligations under
the May 2006 Letter Order or any other applicable waiver or authorization granted to the
Borrower under Section 204 of the FPA to issue securities and assume liabilities under the
Credit Agreement.




and (ii) the following language is hereby added to the end of the last paragraph of Section
6.1 of the Credit Agreement:



3









 






     So long as the Borrower remains subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended, the Borrower may provide, (i) in satisfaction of the
requirement to provide financial statements under Section 6.1.1, its report on Form 10-K for
the applicable fiscal year, and (ii) in satisfaction of the requirement to provide financial
statements under Section 6.1.2, its Report on Form 10-Q for the applicable fiscal quarter.



          2. Representations and Warranties. The Borrower hereby represents and warrants that:





	 	2.1.	 	After giving effect to this Amendment, the representations and warranties made
by the Borrower in the Credit Agreement are true and correct on and as of the date of
this Amendment, except to the extent such representations and warranties expressly
relate to an earlier date, in which case such representations and warranties shall have
been true and correct in all material respects on and as of such earlier date.
	 
	 	2.2.	 	This Amendment has been duly authorized by all requisite action on behalf of
the Borrower and constitutes the legal, valid and binding obligation of the Borrower,
enforceable against the Borrower in accordance with its terms, except to the extent the
enforceability thereof may be limited by applicable bankruptcy, insolvency or other
laws affecting the rights of creditors generally and by the application of general
principles of equity.
	 
	 	2.3.	 	Upon the effectiveness of this Amendment, no Default or Unmatured Default
exists under the terms of the Credit Agreement.





          3. Conditions Precedent. This Amendment shall become effective and be deemed
effective as of the date hereof, if, and only if, the Agent shall have received (i) executed copies
of this Amendment from the Borrower and the Required Lenders and (ii) a duly executed opinion
letter of counsel to the Borrower, addressed to the Lenders and the Agent, in substantially the
form of Exhibit A hereto.




          4. Counterparts. This Amendment may be executed in one or more counterparts, each of
which shall constitute an original Amendment and all of which together shall constitute one and the
same Amendment.




          5. Governing Law. This shall be governed by, and construed in accordance with, the
laws of the State of New York.




          6. Effect.





	 	6.1.	 	Upon the effectiveness of this Amendment, on and after the date hereof, each
reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,”
“herein” or words of like import shall mean and be a reference to the Credit
Agreement, as amended and modified hereby.




4









 












	 	6.2.	 	Except as specifically amended and modified above, the Credit Agreement and all
other documents, instruments and agreements executed and/or delivered in connection
therewith shall remain in full force and effect, and are hereby ratified and confirmed.
	 
	 	6.3.	 	The execution, delivery and effectiveness of this Amendment shall neither,
except as expressly provided herein, operate as a waiver of any right, power or remedy
of the Lenders or the Agent, nor constitute a waiver of any provision of the Credit
Agreement or any other Loan Document. The Agent and the Lenders expressly reserve all
of their rights and remedies, including the right to institute enforcement actions in
consequence of any existing Defaults or Unmatured Defaults not waived hereunder or
otherwise at any time without further notice, under the Credit Agreement and the other
Loan Documents and applicable law.





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          IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and
delivered by their respective officers hereunto duly authorized as of the date first written above.




	 	 	 	 	 
	PINNACLE WEST CAPITAL CORPORATION	 	 
	 
	 	 	 	 
	By:
	 	/s/ Barbara M. Gomez	 	 
	 

	 	 	 	 
	Name:
	 	Barbara M. Gomez	 	 
	 

	 	 	 	 
	Title:
	 	Vice President and Treasurer	 	 
	 

	 	 	 	 





	 	 	 	 	 
	JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
	as a Lender, as an Issuing Bank and as	 	 
	Administrative Agent	 	 
	 
	 	 	 	 
	By:
	 	/s/ Nancy R. Barwig	 	 
	 

	 	 	 	 
	Name:
	 	Nancy R. Barwig	 	 
	Title:
	 	Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	UNION BANK OF CALIFORNIA, N.A.,	 	 
	as a Lender and as Syndication Agent	 	 
	 
	 	 	 	 
	By:
	 	/s/ Efrain Soto	 	 
	 

	 	 	 	 
	Name:
	 	Efrain
Soto	 	 
	Title:
	 	Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	CITIBANK, N.A.,	 	 
	as a Lender and as Co-Documentation Agent	 	 
	 
	 	 	 	 
	By:
	 	/s/ Oscar Cragwell	 	 
	 

	 	 	 	 
	Name:
	 	Oscar Cragwell	 	 
	Title:
	 	Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	KEYBANK NATIONAL ASSOCIATION,	 	 
	as a Lender and as Co-Documentation Agent	 	 
	 
	 	 	 	 
	By:
	 	/s/ Keven D. Smith	 	 
	 

	 	 	 	 
	Name:
	 	Keven D. Smith	 	 
	Title:
	 	Senior Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	MIZUHO CORPORATE BANK, LTD.,	 	 
	as a Lender and as Co-Documentation Agent	 	 
	 
	 	 	 	 
	By:
	 	/s/ Raymond Ventura	 	 
	 

	 	 	 	 
	Name:
	 	Raymond Ventura	 	 
	Title:
	 	Deputy General Manager	 	 
	 

	 	 	 	 





SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT



 









 





	 	 	 	 	 
	BANK OF AMERICA, N.A.,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Gabriela Millhorn	 	 
	 

	 	 	 	 
	Name:
	 	Gabriela Millhorn	 	 
	Title:
	 	Senior Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	THE BANK OF NEW YORK,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ John-Paul Marotta	 	 
	 

	 	 	 	 
	Name:
	 	John-Paul Marotta	 	 
	Title:
	 	Managing Director	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	BARCLAYS BANK PLC,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Alison
McGuigan	 	 
	 

	 	 	 	 
	Name:
	 	Alison
McGuigan	 	 
	Title:
	 	Associate Director	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	CREDIT SUISSE, Cayman Islands Branch,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Sarah Wu	 	 
	 

	 	 	 	 
	Name:
	 	Sarah Wu	 	 
	Title:
	 	Director	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	By:
	 	/s/ Nupur
Kumar	 	 
	 

	 	 	 	 
	Name:
	 	Nupur
Kumar	 	 
	Title:
	 	Associate	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	WELLS FARGO BANK, N.A.,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Ling Li	 	 
	 

	 	 	 	 
	Name:
	 	Ling Li	 	 
	Title:
	 	Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	LEHMAN BROTHERS COMMERCIAL BANK,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ George Janes	 	 
	 

	 	 	 	 
	Name:
	 	George Janes	 	 
	Title:
	 	Chief Credit Officer	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	UBS LOAN FINANCE LLC,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Richard
L. Tavrow	 	 
	 

	 	 	 	 
	Name:
	 	Richard
L. Tavrow	 	 
	Title:
	 	Director	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	By:
	 	/s/ Irja
R. Otsa	 	 
	 

	 	 	 	 
	Name:
	 	Irja
R. Otsa	 	 
	Title:
	 	Associate Director	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	U.S. BANK NATIONAL ASSOCIATION,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Scott J. Bell	 	 
	 

	 	 	 	 
	Name:
	 	Scott J. Bell	 	 
	Title:
	 	Senior Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	MELLON BANK, N.A.,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ Mark W. Rogers	 	 
	 

	 	 	 	 
	Name:
	 	Mark W. Rogers	 	 
	Title:
	 	Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 








	 	 	 	 	 
	THE NORTHERN TRUST COMPANY,	 	 
	as a Lender	 	 
	 
	 	 	 	 
	By:
	 	/s/ John P. Brazzale	 	 
	 

	 	 	 	 
	Name:
	 	John P. Brazzale	 	 
	Title:
	 	Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




 









 







THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., CHICAGO BRANCH, (formerly
 known as UFJ BANK LIMITED),
as a Lender




	 	 	 	 	 
	By:
	 	/s/ Chi-Cheng Chen	 	 
	 

	 	 	 	 
	Name:
	 	Chi-Cheng Chen	 	 
	 

	 	 

	 	 
	Title:
	 	Authorized Signatory
Vice President	 	 
	 

	 	 	 	 




SIGNATURE PAGE TO FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT





 









 







EXHIBIT A




Form of Opinion Letter of Counsel to the Borrower




Attached.