Document:

Exhbit 4.04 Amended and Restated Farmington

                                             Exhibit 4.04
FURTHER AMENDED AND RESTATED
INSTALLMENT SALE AGREEMENT
(Amending and Restating the Amended and Restated Installment Sale Agreement
dated as of August 1, 2002 which amended and restated the Amended and Restated Installment Sale Agreement dated as of November 1, 1994, which had amended and restated the Installment Sale Agreement dated as of November 1, 1983)
between
CITY OF FARMINGTON, NEW MEXICO

Vendor
and
EL PASO ELECTRIC COMPANY
Vendee
Dated as of August 1, 2012
	
					
	 

Four Corners Generating Station, Units 4 and 5	
					
	 

TO THE EXTENT, IF ANY, THAT THIS INSTALLMENT SALE AGREEMENT CONSTITUTES CHATTEL PAPER OR AN INSTRUMENT (AS SUCH TERMS ARE DEFINED IN THE UNIFORM COMMERCIAL CODE AS IN EFFECT IN ANY APPLICABLE JURISDICTION), NO SECURITY INTEREST IN THIS INSTALLMENT SALE AGREEMENT MAY BE CREATED BY THE TRANSFER OR POSSESSION OF ANY COUNTERPART HEREOF OTHER THAN THE COUNTERPART CONTAINING THE PRINTED RECEIPT THEREFOR EXECUTED BY UNION BANK, AS TRUSTEE, ON OR IMMEDIATELY FOLLOWING THE SIGNATURE PAGE HEREOF OR THEREOF.

	
			
	INDEX

	(This Index is not a part of the Agreement
	 

	but rather is for convenience of reference only.)
	 

	 
	 
	Page

	ARTICLE I. DEFINITIONS
	3

	 
	 

	Section 1.01. Definitions
	3

	Section 1.02. Interpretation
	9

	Section 1.03. Captions and Headings
	9

	 
	 

	ARTICLE II. REPRESENTATIONS
	9

	 
	 

	Section 2.01. Representations and Warranties of the City
	9

	Section 2.02. Representations and Warranties of the Company
	9

	Section 2.03. Confirmation of Findings by City
	11

	 
	 

	ARTICLE III. CONSTRUCTION OF THE FACILITIES
	11

	 
	 

	 Section 3.01. Construction of the Facilities
	11

	 
	 

	ARTICLE IV. ISSUANCE SALE AND DISPOSITION OF PROCEEDS OF THE BONDS
	11

	 
	 

	Section 4.01. Issuance and Sale of the Bonds
	11

	Section 4.02. No Additional Bonds
	11

	Section 4.03. Disposition of Proceeds of the Bonds
	11

	Section 4.04. Investment of Moneys Held in Funds Under the Ordinance
	11

	 
	 

	ARTICLE V. SALE AND PURCHASE OF PROJECT; PAYMENT OF PURCHASE PRICE; CONVEYANCE OF TITLE; OPERATION AND MAINTENANCE; INSURANCE; INDEMNIFICATION; CONDEMNATION; TAXES
	12

	 
	 

	Section 5.01. Sale and Purchase of the Project
	12

	Section 5.02. Amounts and Dates for Payment of Purchase Price of the Project
	12

	Section 5.03. Payments by Company to be Assigned to the Trustee:  Obligation for Payments Absolute
	13

	Section 5.04. Payment of Expenses
	13

	Section 5.05. City Access to Facilities
	13

	Section 5.06. Maintenance of Facilities
	13

	Section 5.07. Insurance
	14

	Section 5.08. Indemnification of City; Statements for Services
	14

	Section 5.09. Notices of Damage
	16

	Section 5.10. Condemnation; Disposition of Proceeds
	16

	Section 5.11. Condemnation of Company Property
	17

	Section 5.12. Payments of Taxes and Assessments:  No Liens or Charges
	17

	Section 5.13. Additional Payments by the Company
	17

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	Section 5.14. No Abatement of Payments of Purchase Price of the Project
	18

	Section 5.15. Liens
	18

	 
	 

	ARTICLE VI. SPECIAL COVENANTS; CREDIT FACILITY
	18

	 
	 

	Section 6.01. No Warranty as to Suitability of Facilities
	18

	Section 6.02. Maintenance of Existence
	18

	Section 6.03. Quiet Enjoyment of the Facilities
	19

	Section 6.04. Cooperation in Applications for Permits and Licenses
	19

	Section 6.05. Reserved.
	19

	Section 6.06. City's Access to Facilities
	19

	Section 6.07. Tax Covenants
	19

	Section 6.08. Credit Facility
	19

	 
	 

	ARTICLE VII. ASSIGNMENT, LEASING AND SELLING
	21

	 
	 

	Section 7.01. Assignment, Leasing or Selling of the Facilities by the City
	21

	Section 7.02. Conditions
	21

	Section 7.03. Instrument Furnished to Trustee
	22

	 
	 

	ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES
	22

	 
	 

	Section 8.01. Events of Default
	22

	Section 8.02. Force Majeure
	23

	Section 8.03. Remedies
	23

	Section 8.04. No Remedy Exclusive
	23

	Section 8.05. Reimbursement of Attorneys' Fees
	24

	Section 8.06. Waiver of Breach
	24

	 
	 

	ARTICLE IX. PREPAYMENT OF PURCHASE PRICE OF THE PROJECT
	24

	 
	 

	Section 9.01. Options of Company to Prepay Purchase Price of the Project
	24

	Section 9.02. Exercise of Option
	25

	Section 9.03. Mandatory Prepayment of Purchase Price of the Project
	25

	 
	 

	ARTICLE X. PURCHASE AND REMARKETING OF BONDS
	25

	 
	 

	Section 10.01. Purchase of Bonds
	25

	Section 10.02. Optional Purchase of Bonds
	26

	Section 10.03. Determination of Interest Rate Periods
	26

	 
	 

	ARTICLE XI. MISCELLANEOUS
	26

	 
	 

	Section 11.01. Term of Agreement
	26

	Section 11.02. Notices
	26

	Section 11.03. Parties in Interest
	27

	Section 11.04. Extent of Covenants of the City; No Personal Liability
	27

	Section 11.05. Confirmation of Request by the Company
	28

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	Section 11.06. Amendments
	28

	Section 11.07. Counterparts
	28

	Section 11.08. Severability
	28

	Section 11.09. Governing Law
	28

	 
	 
	 

	Exhibit A - DESCRIPTION OF THE FACILITIES

	Exhibit B - LIST OF THE COMPANY'S AFFILIATES

	 
	 
	 

	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

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FURTHER AMENDED AND RESTATED
INSTALLMENT SALE AGREEMENT
THIS FURTHER AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT, dated as of August 1, 2012, by and between the CITY OF FARMINGTON, in the County of San Juan, an incorporated municipality, a body politic and corporate, existing under the Constitution and Laws of the State of New Mexico (hereinafter called the “City”), as Vendor, and EL PASO ELECTRIC COMPANY, a corporation organized and existing under the laws of the State of Texas (hereinafter called the “Company”), as Vendee, amending and restating the Amended and Restated Installment Sale Agreement, dated as of August 1, 2002, (hereinafter called the “2002 Agreement”) between the City, as Vendor, and the Company, as Vendee, which amended and restated the Amended and Restated Installment Sale Agreement, dated as of November l, 1994 (hereinafter called the “1994 Agreement”), between the City, as Vendor, and the Company, as Vendee, which amended and restated the Installment Sale Agreement dated as of November 1, 1983 (hereinafter called the “1983 Agreement”) between the City, as Vendor, and the Company, as Vendee.
WITNESSETH:
WHEREAS, the City is authorized and empowered under the Pollution Control Revenue Bond Act, Chapter 397, Laws of 1973 of the State of New Mexico, 31st Legislature, 1st Session, as amended (the “Act”) to issue revenue bonds for and to acquire, whether by construction, purchase, gift or lease, one or more projects consisting of any land, interest in land, building, structure, facility, system, fixture, improvement, appurtenance, machinery, equipment or any combination thereof, or any interest in any one or more of the foregoing, whether or not presently in existence or under construction, used by an individual, partnership, firm, company, corporation (including a public utility), association, trust, estate, political subdivision, state agency or any legal entity, or its legal representative, agent or assigns, substantially for the reduction, abatement or prevention of pollution, including, but not limited to, the removal of pollutants, contaminants or foreign substances from land, air or water, or for the removal or treatment of any substance in a processed material which would otherwise cause pollution when such material is used, provided that any such project shall be located within the State of New Mexico and within or without or partially within or without the City, but not more than fifteen miles outside of the corporate limits of the City (or that, if there is no municipality within fifteen miles of the project, the City is in the county in which the project is or may be located) and to sell or lease or otherwise dispose of any or all of such projects upon such terms and conditions as the governing body of the City (hereinafter called the “City Council”) may deem advisable and as shall not conflict with the provisions of the Act; and
WHEREAS, the Four Corners Generating Station, an electric power generating plant (hereinafter called the “Plant”) is located within fifteen miles of the corporate limits of the City in San Juan County, New Mexico but not within the corporate limits of any municipality, or, if portions of the Plant are not located within fifteen miles of the corporate limits of the City, there is no incorporated municipality within fifteen miles of such portions of the Plant and the City is located in the county in which such portions of the Plant are located; and

WHEREAS, the City Council has heretofore on October 23, 1973 adopted a Resolution (the “1973 Resolution”) determining to issue, and, subject to certain conditions, agreeing to issue under the Act revenue bonds to finance the cost to the Company of certain Facilities (the “Facilities”) for the abatement, control, reduction or prevention of air and water pollution caused by the operation of Units 4 and 5 at the Plant, and authorizing the Mayor to execute and deliver a preliminary agreement relating thereto and, subject to certain conditions, to take such steps and actions required or necessary in order to issue such revenue bonds, and a Preliminary Agreement dated as of December 28, 1973 (the “1973 Agreement”) in the form contemplated by the 1973 Resolution was executed and delivered by the City and the Company; and
WHEREAS, the City Council on April 8, 1980 adopted a resolution authorizing the Mayor to execute and deliver an amendment to the 1973 Agreement, and an Amendment to such Agreement dated as of April 8, 1980 in the form contemplated by said resolution was executed and delivered by the City and the Company; and
WHEREAS, the City Council has heretofore on May 26, 1981 adopted an Ordinance and a Resolution approving and authorizing the delivery by the Mayor and the City Clerk of that certain Installment Sale Agreement dated as of June 1, 1981 between the City and the Company and setting forth the undertaking of the City to sell the 1981 Bonds (as hereinafter defined); and
WHEREAS, the City has heretofore issued and sold $35,440,000 aggregate principal amount of its Pollution Control Revenue Bonds, 1981 Series A (El Paso Electric Company, Four Corners Project) (the “1981 Bonds”) the proceeds of which were used to defray a portion of the cost to the Company of acquiring, constructing, reconstructing, improving, maintaining, equipping or furnishing the Facilities; and
WHEREAS, the City Council has heretofore on November 22, 1983 adopted a Resolutions (the “1983 Resolution”) approving and authorizing the execution and delivery by the Mayor and the City Clerk of the City, on behalf of the City, of the 1983 Agreement setting forth the undertaking by the City to issue and sell the 1983 Bonds (as hereinafter defined); and
WHEREAS, the City has heretofore issued and sold $35,805,000 aggregate principal amount of its Annual Tender Pollution Control Revenue Refunding Bonds, 1983 Series A (El Paso Electric Company, Four Corners Project) (the “1983 Bonds”) the proceeds of which were used to refund the outstanding 1981 Bonds; and
WHEREAS, the City has heretofore issued and sold $33,300,000 aggregate principal amount of its Adjustable Tender Pollution Control Revenue Refunding Bonds, 1994 Series A (El Paso Electric Company, Four Corners Project) (the “1994 Bonds”) the proceeds of which were used to refund the outstanding 1983 Bonds; and
WHEREAS, the City has heretofore issued and sold $33,300,000 aggregate principal amount of its Annual Tender Pollution Control Revenue Refunding Bonds, 2002 Series A (El Paso Electric Company, Four Corners Project) (the “2002 Bonds”) the proceeds of which were used to refund the outstanding 1994 Bonds; and
WHEREAS, the Company has advised the City and the Trustee of its election to exercise its option to prepay the unpaid balance of the purchase price of the Project (as hereinafter

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defined) by taking the actions required by the 2002 Ordinance (as hereinafter defined) to cause to be purchased and cancelled the entire principal amount of the 2002 Bonds then outstanding, subject to the Company's right to revoke such election; and
WHEREAS, the City has adopted its Ordinance No. 2012-1256 and Resolution No. 2012-1440, and proposes to issue thereunder its Pollution Control Refunding Revenue Bonds, 2012 Series A (El Paso Electric Company, Four Corners Project) in the aggregate principal amount of $33,300,000 (the “Bonds”); and
WHEREAS, Union Bank, as successor trustee under the 2002 Ordinance and pursuant to instructions from the Company, will refund the 2002 Bonds by paying the principal and interest due on the 2002 Bonds on August 1, 2012 to the 2002 Ordinance; and
WHEREAS, the Company hereby represents and warrants that the Environmental Improvement Division of the Health and Environmental Department of the State of New Mexico (the successor to which is the New Mexico Environment Department), the Agency exercising jurisdiction over the Facilities, has heretofore certified that the pollution control Facilities, as described on Exhibit A hereto, as designed are in furtherance of the purpose of abating or controlling atmospheric or water pollutants or contaminants resulting from the generation of electricity by Units 4 and 5 at the Plant.
NOW, THEREFORE, the parties hereto, intending to be legally bound hereby and in consideration of the premises herein, DO HEREBY AGREE to amend and restate the 2002 Agreement as follows:

ARTICLE I.

DEFINITIONS

Section 1.01. Definitions.  As used herein:

“1981 Bonds” shall mean the City's $35,440,000 aggregate principal amount of Pollution Control Revenue Bonds, 1981 Series A (El Paso Electric Company, Four Corners Project).
“1981 Construction Fund” shall mean the fund created in connection with the 1981 Bonds.
“1983 Agreement” shall mean the Installment Sale Agreement, dated as of November 1, 1983, between the City, as Vendor, and the Company, as Vendee.
“1983 Bonds” shall mean the City's $35,805,000 aggregate principal amount of Annual Tender Pollution Control Revenue Refunding Bonds, 1983 Series A (El Paso Electric Company, Four Corners Project).
“1983 Construction Fund” shall mean the fund created under the 1983 Agreement.
“1983 Ordinance” shall mean Ordinance No. 83-807, as supplemented by Resolution 83‐403, creating and securing the 1983 Bonds, as modified, altered, amended, supplemented or

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confirmed by any and all ordinances or resolutions supplemental thereto or amendatory thereof adopted pursuant thereto.
“1994 Agreement” shall mean that certain Amended and Restated Installment Sale Agreement dated as of November 1, 1994, between the City and the Company, and setting forth the undertaking by the City to issue and sell the 1994 Bonds (as hereinafter defined).
“1994 Bonds” shall mean the City's $33,300,000 aggregate principal amount of Pollution Control Revenue Refunding Bonds, 1994 Series A (El Paso Electric Company, Four Corners Project).
“1994 Construction Fund” shall mean the fund created under the 1994 Agreement.
“1994 Ordinance” shall mean Ordinance No. 94-1018, as amended and supplemented by Ordinances Nos. 96-1035 and 99-965 and Resolution 94-798, creating and securing the 1994 Bonds.
“2002 Agreement” shall mean that certain Amended and Restated Installment Sale Agreement dated as of August 1, 2002, between the City and the Company, and setting forth the undertaking by the City to issue and sell the 2002 Bonds (as hereinafter defined).
“2002 Bonds” shall mean the City's $33,300,000 aggregate principal amount of Pollution Control Revenue Refunding Bonds, 2002 Series A (El Paso Electric Company, Four Corners Project).
“2002 Construction Fund” shall mean the fund created under the 2002 Agreement.
“2002 Ordinance” shall mean Ordinance No. 2002-1134 and Resolution No. 2002-1046, creating and securing the 2002 Bonds.
“Act” shall mean the Pollution Control Revenue Bond Act, Chapter 397, Laws of 1973 of the State of New Mexico, 31st Legislature, 1st Session, as amended by Chapter 312, Laws of 1977 of the State of New Mexico, 33rd Legislature, 1st Session, and Chapter 181, Laws of 1978 of the State of New Mexico, 33rd Legislature, 2nd Session, and Chapter 114, Laws of 1983 of the State of New Mexico, 36th Legislature, 1st Session, and all acts supplemental thereto or amendatory thereof.
“Administration Expenses” shall mean the reasonable expenses incurred by the City with respect to this Agreement, the Ordinance and any transaction or event contemplated by this Agreement or the Ordinance, including, without limitation, the reasonable fees and disbursements of counsel and out-of-pocket expenses of the City incurred in connection with the authorization, issuance and sale of the Bonds and the compensation and reimbursement of reasonable fees, expenses and advances payable to the Trustee, the Registrar, the Paying Agent, the Tender Agent, the Bank and the Remarketing Agent under the Ordinance.
“Agreement” shall mean this Further Amended and Restated Installment Sale Agreement dated as of August 1, 2012 amending and restating the Amended and Restated Installment Sale

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Agreement dated as of August 1, 2002 which amended and restated the Amended and Restated Installment Sale Agreement dated as of November 1, 1994 which had amended and restated the Installment Sale Agreement dated as of November 1, 1983, all between the City and the Company and any and all modifications, alterations, amendments and supplements hereto.
“Alternate Credit Support” shall mean any letter of credit, credit facility, insurance policy, guarantee or other credit support agreement or security mechanism provided by the Company in accordance with Section 6.08 hereof and any extension thereof.
“Authorized Company Representative” shall mean each person at the time designated to act on behalf of the Company by written certificate furnished to the City and the Trustee containing the specimen signature of such person and signed on behalf of the Company.
“Bank” shall mean the issuer of a Letter of Credit, if any, delivered in conjunction with the Bonds, and the issuer of any subsequently issued Credit Facility so long as such other Credit Facility shall be in effect, and in its capacity as such issuer, its successors in such capacity and their assigns.
“Bond” or “Bonds” or “2012 Bonds” shall mean the bonds authorized to be issued under the Ordinance.
“Bond Counsel” shall mean any firm of nationally recognized bond counsel experienced in the financing of pollution control facilities and acceptable to the City, the Trustee and the Company.
“Bond Fund” shall mean the fund created by Section 5.01 of the Ordinance.
“City” shall mean the City of Farmington, in the County, an incorporated municipality, a body politic and corporate, existing under the Constitution and the Laws of the State of New Mexico, and its successors and assigns.
“City Council” shall mean the City Council of the City or the board or body in which general legislative powers of the City may subsequently be vested.
“Claim” shall mean liabilities, obligations, losses, damages, taxes (other than taxes on income), penalties, claims (including, without limitation, claims involving liability in tort, whether strict or otherwise), actions, suits, judgments, costs, interest, expenses and disbursements, whether or not any of the foregoing shall be founded or unfounded, contingent or otherwise (including, without limitation, legal fees and expenses and costs of investigation) of any kind and nature whatsoever without any limitation as to amount.
“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.  Each reference herein to a section of the Code shall be deemed to include the United States Treasury Regulations adopted under the Code, as the same may be in effect from time to time, unless the context clearly requires otherwise.

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“Company” shall mean El Paso Electric Company, a corporation formed and existing under the laws of the State of Texas, its successors and their assigns and any transferee entity to the extent permitted by Section 6.02 hereof.
“Company Indentures” shall mean (i) that certain General Mortgage Indenture and Deed of Trust, dated as of February 1, 1996, between the Company and State Street Bank and Trust Company, as trustee, as supplemented and modified by the seven indentures supplemental thereto or (ii) any indenture or mortgage made by the Company to secure substantially the same obligations as are currently secured by the Company Indentures, and subjecting thereto substantially the same property, and subject to substantially the same prior liens and encumbrances, and having substantially similar provisions for the issuance of additional debt thereunder, as the Company Indentures.
“Counsel” shall mean an attorney at law selected by the Company (who may be counsel to either or both of the City and the Company) and acceptable to the Trustee or, if not selected by the Company within a reasonable time following any request therefor, by the City and acceptable to the Trustee.
“County” shall mean San Juan County, New Mexico.
“Credit Facility” shall mean, collectively, a Letter of Credit, if any, and any extensions thereof, and, upon the issuance and delivery of any Alternate Credit Support in accordance with Section 6.08 hereof, “Credit Facility” shall mean such Alternate Credit Support.
“Environmental Law” shall mean any federal, state or local law, rule, regulation, order, writ, judgment, injunction, decree, determination or award relating to the environment, health or safety or to the release or threatened release of any materials into the environment, including, without limitation, the Clean Air Act, as amended, the Clean Water Act of 1977, as amended, the comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, the Hazardous Materials Transportation Act, as amended, the Toxic Substance Control Act, as amended, and the Resource Conservation and Recovery Act of 1976, as amended.
“Facilities” shall mean the pollution control systems and facilities presently existing, under construction and to be constructed at the Plant, which are described in Exhibit A hereto, as from time to time revised, changed, amended or modified and related improvements and any substitutions therefor.
“Hazardous Materials” shall mean all materials that are, or become, subject to any Environmental Law, including, without limitation, materials listed in 49 I.E. §172.101, materials defined as hazardous pursuant to Section 101(14) of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, flammable, explosive or radioactive materials, hazardous or toxic wastes or substances, petroleum or petroleum distillates, PCB's or asbestos or urea formaldehyde containing materials.
“Letter of Credit” shall mean an irrevocable, direct-pay letter of credit, if any, issued by the Bank and delivered to the Trustee in accordance with Section 6.08 hereof and any extension thereof.

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“Moody's” shall mean Moody's Investors Service, Inc., a corporation organized and existing under the laws of the State of Delaware, its successors and their assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “Moody's” shall be deemed to refer to any other nationally-recognized securities rating-agency designated by the Company, with the approval of the Remarketing Agent and the Bank, by notice to the Trustee, the Tender Agent and the City.
“Ordinance” shall mean Ordinance No. 2012-1256 adopted by the City June 12, 2012, as supplemented by Resolution No. 2012-1440 adopted by the City on July 10, 2012, creating and securing the Bonds, as modified, altered, amended, supplemented or confirmed by any and all ordinances or resolutions supplemental thereto or amendatory thereof adopted pursuant thereto.
“Outstanding”, when used in reference to the Bonds, shall mean, as at any particular date, the aggregate of all Bonds authenticated and delivered under the Ordinance except;
(a)those cancelled at or prior to such date or delivered to or held by the Trustee at or prior to such date for cancellation;

(b)those deemed to have been paid in accordance with Article IX of the Ordinance;

(c)those in lieu of, or in exchange, replacement or substitution for which, other Bonds shall have been authenticated and delivered pursuant to the Ordinance unless proof satisfactory to the Trustee and the Company is presented that such Bond is held by a bona fide holder in due course; and

(d)Undelivered Bonds.

“Owner” shall mean the person or entity in whose name any Bond is registered upon the registration books maintained pursuant to Section 2.04 of the Ordinance.
“Permitted Encumbrances” shall mean and include (a) liens for taxes, assessments and other governmental charges not delinquent or which can be paid without penalty; (b) unfiled, inchoate mechanics' and materialmen's liens for construction work in progress; (c) workmen's, repairmen's, warehousemen's and carriers' liens and other similar liens, if any, arising in the ordinary course of business; (d) all the following, if they do not individually or in the aggregate materially impair the use of the Facilities or materially detract from the value thereof to the Company, viz. any easements, restrictions, mineral, oil, gas and mining rights and reservations, zoning laws and defects in title or other encumbrances to which the Facilities may be subject because of the installation thereof at the Plant; (e) any lien for the satisfaction and discharge of which a sum of money or surety bond deemed adequate by the Trustee is on deposit with the Trustee; (f) the rights of the City under this Agreement or any other sale agreement or lease agreement between the City and the Company relating to the issuance of bonds under the Act; (g) the lien of the Company Indentures and the permitted encumbrances and other prior liens referred to therein; (h)(1) the rights and interest of the Navajo Tribe of Indians in the Plant site (which is located on the Navajo Reservation), the Company's rights existing by virtue of the Supplemental Lease dated as of July 19, 1966, between the Navajo Tribe of Indians, as lessor, and the Company and certain other persons as tenants in common, as lessees; (2) the rights and

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interest of the United States of America in the Plant site and the Company's rights existing by virtue of the rights-of-way and easements granted to the Company and certain other persons as tenants in common by the Secretary of the Interior of the United States of America, by Grant dated as of July 1966; (3) any defects in the title of the Navajo Tribe to the lands leased; and (4) any restrictions on, or inability of the Company to obtain enforcement or such lease against the Navajo Tribe; and (i) rights and interests of co-owners of the Plant arising under the Plant Agreements.
“Plant” shall mean the Four Corners Generating Station, an electric power generating plant located within fifteen miles of the corporate limits of the City in the county but not within the corporate limits of any municipality or, if portions of the Plant are not located within fifteen miles of the corporate limits of the City, there is no incorporated municipality within fifteen miles of such portions of the Plant and the City is located in the county in which such portions of the Plant are located.
“Plant Agreements” shall mean all of the contracts relating to the ownership, construction and operation of Unit 4 and Unit 5 at the Plant as from time to time amended and supplemented.
“Project” shall mean the interest in the Facilities sold by the City to the Company pursuant to this Agreement.
“Purchase Price of the Project” shall mean that purchase price determined pursuant to Section 5.02(a) of this Agreement.
“Reimbursement Agreement” shall mean (i) any Reimbursement Agreement, made by the Company in favor of the Bank, relating to payments for moneys drawn under the Letter of Credit, if any, and any amendments, modifications and supplements thereto, and (ii) from and after the issuance of an Alternate Credit Support, any letter of credit reimbursement agreement or other arrangement between the Company and the issuer of any Alternate Credit Support, and any amendments, modifications and supplements thereto.
“Remarketing Agent” shall mean any remarketing agent appointed in accordance with Sections 1.01 and 14.01(a) of the Ordinance.
“S&P” shall mean Standard & Poor's Ratings Group (a Division of McGraw-Hill Inc.), a corporation organized and existing under the laws of the State of New York, its successors and their assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “S&P” shall be deemed to refer to any other nationally-recognized securities rating agency designated by the Company, with the approval of the Remarketing Agent and the Bank, by notice to the Trustee, the Tender Agent and the City.
“Tender Agent” shall mean any tender agent appointed in accordance with Sections 1.01 and 14.01(b) of the Ordinance.
“Trustee” shall mean Union Bank, as trustee under the Ordinance, and its successor or successors in accordance with the Ordinance.  “Corporate Trust Office” of the Trustee shall mean the principal office of the Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of the adoption of the Ordinance is 120

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South San Pedro Street, 4th Floor, Los Angeles, California 90012, Attention: Corporate Trust; except that with respect to the presentation of Bonds for payment or for registration of transfer, exchange or tender, such term shall mean the office or agency of the Trustee at 120 South San Pedro Street, 4th Floor, Los Angeles, California  90012, Attention: Bond Redemption.
Section 1.02.    Interpretation.  Unless the context indicates otherwise, words importing the singular number include the plural number, and vice versa: the terms “hereof”, “hereby”, “herein”, “hereto”, “hereunder” and similar terms refer to this Agreement: and the term “hereafter” means after, and the term “heretofore” means before, the date of delivery of the Bonds.  Words of any gender include the correlative words of the other genders, unless the sense indicates otherwise.

Section 1.03.    Captions and Headings.  The captions and headings in this Agreement are solely for convenience of reference and in no way define, limit or describe the scope or intent of any Articles, Sections, subsections, paragraphs, subparagraphs or clauses hereof.
(End of Article I)
ARTICLE II.

           REPRESENTATIONS

Section 2.01.    Representations and Warranties of the City.  The City makes the following representations and warranties as the basis for the undertakings on the part of the Company herein contained:

(a)The City is an incorporated municipality, a body politic and corporate, existing under the Constitution and laws of the State of New Mexico;

(b)The City has the power to enter into the transactions contemplated by this Agreement and the Ordinance and to carry out its obligations hereunder and thereunder;

(c)The City has the power to enter into this Agreement and by proper corporate action has duly authorized the execution and delivery hereof, and

(d)The execution and delivery of this Agreement and the adoption of the Ordinance and compliance with the provisions hereof and thereof will not conflict with, or constitute on the part of the City a breach of or a default under, any existing law, court or administrative regulation, decree or order to which the City is subject to any agreement, ordinance, mortgage, lease or other instrument by which the City is or may be bound.

Section 2.02.Representations and Warranties of the Company.  The Company makes the following representations and warranties as the basis for the undertakings on the part of the City herein contained:

(a)(i) The Company is a corporation duly incorporated under the laws of the State of Texas and is in good standing under the laws of the State of Texas, has power to

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enter into this Agreement and to perform and observe the agreements and covenants on its part contained herein, and by proper corporate action has duly authorized the execution and delivery hereof, (ii) the Company is duly qualified to hold property and transact business as a foreign corporation and is in good standing under the laws of the State of New Mexico, (iii) all of the proceeds of the Bonds will be used to purchase and cancel the 2002 Bonds, (iv) prior to the issuance of the Bonds, the New Mexico Public Regulation Commission and the Federal Energy Regulatory Commission will have approved all matters relating to the Company's participation in the transactions contemplated by this Agreement which require said approval, and no other consent, approval, authorization or other order of any regulatory body or administrative agency or other governmental body is legally required for the Company's participation therein except such as have been or will have been obtained prior to the issuance of the Bonds or such, if any, as may be required under state securities or Blue Sky laws, and (v) the execution and delivery of this Agreement by the Company do not, and consummation of the transactions contemplated hereby and fulfillment of the terms hereof will not, result in a breach of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust or other agreement or instrument to which the Company is a party, or the Restated Articles of Incorporation or Bylaws of the Company, or any order, rule or regulation applicable to the Company of any court or of any Federal or state regulatory body or administrative agency or other governmental body having jurisdiction over the Company or over any of its properties, or any statute of any jurisdiction applicable to the Company other than breaches or defaults that individually or in the aggregate are not expected to have a material adverse effect on the Company.

(b)The Facilities meet applicable Federal, state and local requirements for the control of pollution now in effect and are used for the reduction, abatement and prevention of pollution;

(c)The Company does not presently expect that the description of the Facilities contained in Exhibit A hereto will be revised;

(d)The Facilities are located in the County within fifteen miles of the City, but not within the corporate limits of any municipality or, if portions of the Facilities are not located within fifteen miles of the corporate limits of the City, there is no incorporated municipality within fifteen miles of such portions of the Facilities;

(e)With respect to the Facilities at the date of this Agreement it has, good and marketable title to such interest therein, free and clear of all claims, liens and encumbrances other than Permitted Encumbrances; and

(f)The interest referred to in subsection (e) of this Section is, and on the date of the first issuance of the Bonds hereunder such interest will be, (i) a 7% undivided interest with respect to Facilities serving only Units 4 and 5 at the Plant and (ii) a 5.07% undivided interest with respect to Facilities serving all five Units at the Plant.

(g)The Company has no affiliates except those listed on Exhibit B hereto.

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(h)All amounts, if any, in the 1981 Construction Fund, 1983 Construction Fund, 1994 Construction Fund, 2002 Construction Fund and any bond and other funds relating to the 1981 Bonds, 1983 Bonds, 1994 Bonds and 2002 Bonds have been fully expended in compliance with the ordinances, resolutions and installment sale agreements relating thereto, and all of foregoing funds have been closed and terminated.

(i)The Company is solely responsible for the accuracy of the definitions of “Company Indentures,” “Permitted Encumbrances” and “Plant Agreements” under Section 1.01 hereof, and the Company understands that the City makes no representation with respect thereto.

Section 2.03.    Confirmation of Findings by City.  The City hereby confirms its findings that its financing of the Company's interest in the Facilities will serve the public purpose of the act to protect and promote the health, welfare and safety of the citizens of the State of New Mexico and its habitat and wildlife, with the resultant higher level of employment and economic activity and stability.

(End of Article II)

ARTICLE III.

CONSTRUCTION OF THE FACILITIES

Section 3.01.    Construction of the Facilities.  The Company has exercised all its rights, powers, elections and options under the Plant Agreements to cause the acquisition, construction, improvement or equipping of the Facilities on the site of the Plant.  In accordance with the provisions of Section 3.06 of the 1994 Agreement and Section 5.01(d) of the 1994 Ordinance, the Company provided the required certification to the City and the Trustee upon completion of the Facilities.

(End of Article III)

ARTICLE IV.

ISSUANCE SALE AND DISPOSITION OF PROCEEDS OF THE BONDS

Section 4.01.    Issuance and Sale of the Bonds.  The City agrees with the Company that it will cooperate with the Company and use its best efforts to issue, sell and deliver the Bonds.

Section 4.02.    No Additional Bonds.  The Ordinance does not provide for the issuance of any bonds other than the Bonds.

Section 4.03.    Disposition of Proceeds of the Bonds.  The proceeds of the Bonds shall be applied to refund and redeem the 2002 Bonds, all as provided in the Ordinance.

Section 4.04.    Investment of Moneys Held in Funds Under the Ordinance.  The Company and the City agree that any moneys held in any fund created by the Ordinance shall be invested or reinvested only as provided in the Ordinance.

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(End of Article IV)

ARTICLE V.

SALE AND PURCHASE OF PROJECT; PAYMENT OF PURCHASE PRICE; CONVEYANCE OF TITLE; OPERATION AND MAINTENANCE; INSURANCE; INDEMNIFICATION; CONDEMNATION; TAXES

Section 5.01.    Sale and Purchase of the Project.  Pursuant to Sections 3.07 and 5.01 of the 1994 Agreement, the Facilities were sold by the Company to the City and then resold by the City to the Company for a purchase price set forth therein.  The parties hereto agree that, notwithstanding anything to the contrary in the 1994 Agreement or the 2002 Agreement, effective as of the date of issuance of the Bonds, the Purchase Price for the Project shall be defined in Section 5.02 hereof.

Section 5.02.    Amounts and Dates for Payment of Purchase Price of the Project.

(a)The price to be paid by the Company for the Project shall be an amount equal to the aggregate principal amount due on the Bonds, whether at maturity or by reason of redemption, or otherwise, and the interest to be paid by the Company on its obligation to pay such price shall be an amount equal to the aggregate of the premium, if any, and interest on the Bonds, such price together with such interest thereon being for all purposes of this Agreement referred to as the “Purchase Price of the Project.”  The Company shall, and hereby agrees to, pay the Purchase Price of the Project by delivery or causing delivery of such further installments, in immediately available funds, necessary on the dates and in the amounts and in the manner in the Ordinance as may be necessary to enable the City to cause payment to be made to the Trustee of principal of and premium, if any, and interest on the Bonds, whether at maturity, upon redemption, or otherwise, provided that any amount credited under the Ordinance against any cash payment required to be made by the City thereunder shall be credited against the corresponding cash payment required to be made by the Company hereunder.

(b)The Company shall, and hereby agrees to, pay in addition to the Purchase Price of the Project an amount equal to the aggregate of all other payments to be made out of the Bond Fund, payment thereof to be made not later than the principal or interest payment date next following any such payment out of the Bond Fund but in any event in time to prevent any failure to pay when due the principal of, premium, if any, and interest on any of the Bonds.

(c)In the event the Company shall fail to make any of the payments required in this Section 5.02, the item or installment so in default shall continue as an obligation of the Company until the amount in default shall have been fully paid.  Draws by the Trustee under the Credit Facility to pay the principal of, premium, if any, or interest on the Bonds shall be deemed to satisfy the Company's obligation to make purchase price payments to the extent of such draws.

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(d)The obligation of the Company to make the payments described in subsection (a) of this Section may be accelerated or prepaid in accordance with the provisions of this Agreement, notwithstanding the provisions of this Section.

Section 5.03.    Payments by Company to be Assigned to the Trustee:  Obligation for Payments Absolute.  It is understood and agreed that all payments under Section 5.02 of this Agreement are, by the Ordinance, to be pledged by the City to the Trustee, and that all rights and interest of the City under this Agreement, except for the City's rights under Sections 5.04, 5.08 and 8.05 of this Agreement and any rights of the City to receive notices, certificates, requests, requisitions, directions and other communications hereunder, are to be pledged and assigned to the Trustee.  The Company assents to such pledge and assignment and agrees that the obligation of the Company to make the payments under Section 5.02 hereof shall be absolute, irrevocable and unconditional and shall not be subject to any defense (other than payment) or any right of set-off, counterclaim or recoupment arising out of any breach under this Agreement, the Reimbursement Agreement, the Ordinance, the Credit Facility or otherwise by the City, the Trustee, the Tender Agent, the Remarketing Agent, the Bank or any other party, or out of any obligation or liability at any time owing to the Company by the City, the Trustee, the Tender Agent, the Remarketing Agent, the Bank or any other party.  The City directs the Company, and the Company agrees, to pay to the Trustee at its Corporate Trust Office all payments pursuant to Section 5.02 of this Agreement.

Section 5.04.Payment of Expenses.  The Company agrees to pay all compensation and reasonable fees and expenses of, and to reimburse for the expenses and advances incurred by each of the Trustee, the Registrar, the Remarketing Agent, the Paying Agent and the Tender Agent under the Ordinance.  So long as any Bonds are Outstanding, the Company will pay to the City semiannually, on a date to be agreed upon, or within 30 days of receipt of a statement therefor submitted to the Company pursuant to Section 5.08 hereof, the amount of any other Administration Expenses not theretofore provided for which have accrued and become payable.

Section 5.05.    City Access to Facilities.  The Company agrees that the City shall have the right, upon appropriate prior notice to the Company, to have reasonable access to the Facilities during normal business hours for the purpose of making examinations and inspections of the same, provided, however, that the Company reserves the right to restrict access to any of its generating facilities in accordance with reasonably adopted procedures relating to safety and security.

Section 5.06.    Maintenance of Facilities.  So long as any Bonds are Outstanding, the Company will exercise all of its rights, powers, elections and options under the Plant Agreements to maintain, preserve and keep the Facilities or to cause such Facilities to be maintained, preserved and kept in good repair, working order or condition and from time to time to make or cause to be made all necessary and proper repairs, replacements and renewals; provided, however, that the Company will have no obligation to maintain, preserve, keep, repair, replace or renew any item or portion of such Facilities (a) the maintenance, preservation, keeping, repair, replacement or renewal of which becomes uneconomic to the Company because of damage or destruction by a cause not within the control of the Company, or obsolescence (including economic obsolescence) or change in governmental standards and regulations, or the termination by the Company of the operation of the generating facilities to which the portion of such

13

Facilities is an adjunct, and (b) with respect to which the Company has furnished to the City and the Trustee a certificate executed by an Authorized Company Representative that the maintenance, preservation, keeping, repair, replacement or renewal of such portion of such Facilities is being discontinued for one of the foregoing reasons, which shall be stated therein.

The Company shall have the privilege at its own expense of remodeling such Facilities or making substitutions, modifications and improvements to such Facilities from time to time as it, in its discretion, may deem to be desirable for its uses and purposes, which remodeling, substitutions, modifications and improvements shall be included under the terms of this Agreement as part of such Facilities.

Section 5.07.    Insurance.  So long as any Bonds are Outstanding and the Company, itself or through its agents, operates the Facilities, the Company shall maintain or cause to be maintained, through a program of self-insurance or otherwise, such fire, casualty, public liability and other insurance with respect to the Facilities owned or leased by the Company as is customarily carried by electric utility companies with respect to similar facilities.

Section 5.08.    Indemnification of City; Statements for Services.  The Company agrees, whether or not any of the transactions contemplated hereby shall be consummated and whether or not this Agreement, the Ordinance, the Credit Facility or any other document relating to the Bonds shall have expired or been terminated to release, to assume liability for, and agrees to indemnify and hold harmless, on an after-tax basis, the City, the Trustee, the Paying Agent and the Registrar and each of the officers, officials, directors, employees, staff members, agents, shareholders and partners of each of the Trustee, the Paying Agent and the Registrar (each an “Indemnified Party” and collectively, the “Indemnified Parties”) from and against, any and all Claims that are imposed on, incurred by or asserted against any Indemnified Party (whether or not because of an act or omission by such Indemnified Party and whether or not such Indemnified Party shall also be indemnified by another person), in whole or in part, as a result of, caused by, arising out of or in any way relating to:

(a)any injury to or death of any person or damage to property in or upon the Facilities or growing out of or connected with the use, non-use, condition or occupancy of the Facilities or any part thereof;

(b)violation of any agreement or condition of this Agreement;

(c)violation by the Company of any contract, agreement or restriction relating to the Facilities;

(d)violation of any law, ordinance or regulation affecting the Facilities or a part thereof or the ownership, occupancy or use thereof;

(e)any statement or information contained in the Ordinance, this Agreement, any official statement, Disclosure Document, any certificate or any other documents relating to the Bonds and the proceedings relating to their issuance and sale, furnished by the Company to the City which is misleading, untrue or incorrect in any material respect or use thereof;

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(f)any investigation, litigation, proceeding, cleanup, audit, violation or other matter, related to, of, or involving the application or compliance with any Environmental Law, the protection of the environment or the release by the Company of any Hazardous Material;

(g)the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission, discharging or releases from, any property owned or operated by the Company of any Hazardous Material, whether caused by, or within the control of, the Company; and

(h)the administration of the trust created by the Ordinance, the exercise of any rights under the Ordinance and the performance of any remedial measures permitted by the Ordinance,

except for (i) a Claim against an Indemnified Party (other than the City) that arises by reason of such Indemnified Party's gross negligence or willful misconduct or, in the case of clause (h) above, negligence or willful misconduct and (ii) Claims arising out of activities described in Section 56-7-1A or B, NMSA 1978, to the extent such Sections are applicable; provided, however, if and to the extent the foregoing agreement to indemnify is unenforceable for any reason, the Company agrees to make the maximum contribution to the payment and satisfaction of each of the agreed indemnities that is permissible under applicable law.

In addition, the Company will indemnify and hold the City, the Trustee, the Paying Agent, the Registrar, the Trustee's, the Paying Agent's and the Registrar's officers, directors, employees and agents free and harmless from any loss, claim, damage, tax, penalty, liability (including but not limited to liability for any patent infringement), disbursement, cause of action, suit, demand, judgment, litigation expenses, attorneys' fees and expenses or court costs arising out of, or in any way relating to (a) any errors or omissions of any nature whatsoever contained in any legal proceedings or other official representation or inducement made by the City pertaining to the Bonds, (b) any fraud or misrepresentations or omissions contained in the proceedings of the City relating to the issuance of the Bonds or pertaining to the financial condition of the Company which, if known to a purchaser or holder of the Bonds, might be considered a material factor in a decision whether or not to buy the Bonds, and (c) the execution or performance of this Agreement, the issuance or sale of the Bonds, actions taken under the Ordinance or any other cause whatsoever pertaining to the Facilities and the approval under the Act, and from any taxes levied or assessed by reason of the sale of its interests in the Facilities by the Company to the City and by reason of the sale of the Project by the City to the Company.
Promptly after receipt by an Indemnified Party under this Section 5.08 of written notice of the existence of a claim in respect of which indemnity hereunder may be sought or of the commencement of any action against the Indemnified Party in respect of which indemnity hereunder may be sought, the Indemnified Party shall notify the Company in writing of the existence of such Claim or commencement of such action.  In case any such action shall be brought against an Indemnified Party under this Section 5.08, the Indemnified Party shall notify the Company of the commencement thereof and the Company shall be entitled to participate in and, to the extent that it may wish, to assume the defense thereof, with counsel satisfactory to the Indemnified Party; provided, however, that if the Indemnified Party shall have been advised in

15

an opinion of counsel to the Indemnified Party that there may be legal defenses available to it which are adverse to or in conflict with those available to the Company or other Indemnified Parties, which in the opinion of counsel to the Indemnified Party, should be handled by separate counsel, the Company shall not have the right to assume the defense of such action on behalf of the Indemnified Party, but shall be responsible for the reasonable fees and expenses of the Indemnified Party in conducting its defense; and provided, further, that if the Company shall not have assumed the defense of such action, and shall not have employed counsel therefor satisfactory to the Indemnified Party within a reasonable time after notice of commencement of such action, such reasonable fees and expenses incurred by the Indemnified Party in conducting its own defense shall be borne by the Company.
The Company's responsibility for the reasonable fees and expenses of any Indemnified Party in conducting its defense as provided in the preceding paragraph shall commence from the time the Claim is known of by the Company, and such responsibility shall exist and continue regardless of the merits of the Claim.
In addition, the Company agrees that if it initiates any action, suit or other proceeding with respect to any claim, demand or request for relief, whether judicial or administrative, in which the City, the Trustee, the Registrar or the Paying Agent is named or joined as a party, the Company will pay and reimburse to such party the full amount of all reasonable fees and expenses incurred by such party with respect to such party's defense of or participation in such action, suit or other proceeding.
The City may submit to the Company periodic statements, not more frequently than monthly, for the reasonable value of services of any City employees utilized, and for the full amount of any City expenses incurred by the City in connection with the performance or attainment by the City of its obligations and rights under the Ordinance, the Bonds or this Agreement, and the Company shall make payment to the City of the full amount of each such statement within 30 days after the Company receives such statement; provided that the Company within such 30-day period may in writing and in good faith specifically protest all or any portion of the amounts included in such statement and in such event the Company shall not be obligated to make payment to the City of the amount which has been protested in such manner until ten days after such protest shall have been resolved either by agreement between the City and the Company or by an appropriate tribunal.
Under this Section 5.08, the Company shall also be deemed to release, indemnify and agree to hold harmless each employee, official or officer of the City to the same extent as the City.
Section 5.09.    Notices of Damage.  After the occurrence of any material damage or loss to the Facilities, if any Bonds are then Outstanding, the Company shall notify the City and the Trustee as to the nature and extent of such damage or loss and whether it is practicable and desirable to rebuild, repair, or restore such damage or loss.

Section 5.10.    Condemnation; Disposition of Proceeds.  In the event that title to or the temporary use of the Facilities, or any part thereof, shall be taken in condemnation or by the exercise of the power of eminent domain by any governmental body or by any person, firm or

16

corporation acting under governmental authority, any proceeds received by the City from any award or awards in respect of the Facilities or any part thereof made in such condemnation or eminent domain proceedings, after payment of all expenses incurred in the collection thereof, shall to the extent of the Company's interest therein be paid to and for the account of the Company, and the City hereby assigns to the Company all of its right, title and interest in and to any claim for and rights with respect to any such condemnation award.

The City shall cooperate fully with the Company in the handling and conducting of any prospective or pending condemnation proceedings with respect to the Facilities or any part thereof.  In no event will the City voluntarily settle or consent to the settlement of any prospective or pending condemnation proceedings with respect to the Facilities or any part thereof without the written consent of the Company, and the City will, at the request of the Company, accept a sum in payment therefor at any stage of the condemnation proceedings which the Company shall certify to the City to be fair.  Unless and until such a request is made by the Company, the City will take or cause to be taken all actions necessary to obtain the award of fair compensation for the taking and the collection thereof.
Section 5.11.    Condemnation of Company Property.  The Company shall be entitled to the entire proceeds of any condemnation award or portion thereof made for damages to or takings of its own property other than the Facilities.

Section 5.12.    Payments of Taxes and Assessments:  No Liens or Charges.  The Company will:  (a) pay, or make provision for payment of, all lawful taxes and assessments, including income, profits, property or excise taxes, if any, or other municipal or governmental charges, levied or assessed by any Federal, state or municipal government or political body upon the City with respect to or upon its interest in the Facilities, upon the Project or upon any part of either or upon any installment payments hereunder when the same shall become due and (b) pay or cause to be discharged or make adequate provision to satisfy and discharge, within sixty (60) days after the same shall accrue, any lien or charge upon any installment payment hereunder and all lawful claims or demands for labor, materials, supplies or other charges which, if unpaid, might be or become a lien upon any installment payment hereunder, except Permitted Encumbrances; provided with respect to both clause (a) and clause (b) of this Section 5.12 that the Company may in good faith contest any such tax, assessment, lien, charge, claim or demand in appropriate legal proceedings if the Company shall notify the City and the Trustee of its intention so to do at or prior to the time of initiating such contest, and in such event may permit the items so contested to remain unpaid, undischarged and unsatisfied during the period of such contest and any appeal therefrom, unless the City or the Trustee shall notify the Company in writing that, in the opinion of Counsel, by nonpayment of any such items the lien of the ordinance as to the installment payments of the Purchase Price of the Project will be materially endangered, in which event the Company shall promptly pay and cause to be satisfied and discharged all such unpaid items.  The City will cooperate fully with the Company in any such contest.

Section 5.13.    Additional Payments by the Company.  The Company will pay, or cause be paid, in addition to the payments provided for in Section 5.02(a) hereof, all of the expenses of operation of the portions of the Project including, without limitation, the cost of all necessary and 

17

proper repairs, replacements and renewals made pursuant to Section 5.06 hereof and premiums for insurance pursuant to Section 5.07 hereof.

Section 5.14.    No Abatement of Payments of Purchase Price of the Project.  It is understood and agreed that the payments under Section 5.02(a) hereof and other charges payable hereunder shall continue to be payable at the times and in the amounts herein specified, whether or not the Facilities, or any portion thereof, shall not have been completed or shall have been destroyed by fire or other casualty, or title thereto, or the use thereof, shall have been taken by the exercise of the power of eminent domain, and that there shall be no abatement of any such payments and other charges by reason thereof, whether or not the Facilities are used or useful and whether or not any applicable laws, regulations or standards prevent or prohibit the use of the Plant or the Facilities or any portion thereof, or for any other reason.

Section 5.15.    Liens.  The Company hereby agrees not to create any lien upon the Bond Fund or upon the Receipts and Revenues (as defined in the Ordinance) other than the lien created in the Ordinance.  The Company hereby agrees that it shall not have any interest in the Bond Fund or the moneys or Investment Securities (as defined in the Ordinance) therein.

(End of Article V)
ARTICLE VI.
SPECIAL COVENANTS; CREDIT FACILITY

Section 6.01.    No Warranty as to Suitability of Facilities.  The City makes no warranty, either express or implied, with respect to the Facilities as a whole or with respect to any item or portion of the Facilities.  Without limiting the effect of the preceding sentence, it is expressly agreed that in connection with the sale and conveyance pursuant to this Agreement (1) the City makes no warranty that the title conveyed shall be good or that its transfer is or was rightful or that the goods shall be delivered free from any security interest or other lien or encumbrance, (2) the City makes NO WARRANTY OF MERCHANTABILITY, and (3) THERE ARE NO WARRANTIES WHICH EXTEND BEYOND THE DESCRIPTION ON THE FACE HEREOF.

Section 6.02.Maintenance of Existence.  The Company covenants that it will maintain its corporate existence, will not dissolve or otherwise dispose of all or substantially all its assets and will not consolidate with or merge into another corporation; provided, however, that the Company may consolidate with or merge with or into, or sell or otherwise transfer all or substantially all of its assets (and may thereafter dissolve), to another corporation, incorporated under the laws of the United States, one of the states thereof or the District of Columbia, provided, in the event the Company is not the surviving, resulting or transferee corporation, as the case may be, such corporation prior to such merger, consolidation, sale or transfer assumes, by delivery to the Trustee of an instrument in writing satisfactory in form and substance to the Trustee, all the obligations of the Company herein.

If consolidation, merger or sale or other transfer is made as permitted by this Section, the provisions of this Section shall continue in full force and effect and no further consolidation, merger or sale or other transfer shall be made except in compliance with the provisions of this

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Section.  The Company shall notify the Trustee of its affiliates from time to time and of the filing of a petition in bankruptcy by or on behalf of any of itself or its affiliates from time to time.
Section 6.03.    Quiet Enjoyment of the Facilities.  The City covenants that the Company, upon observing and performing the terms, conditions and covenants on the Company's part to be observed and performed under this Agreement, shall peaceably and quietly have, hold and enjoy the Facilities as purchaser in possession, free from molestation, hindrance, eviction or disturbance by the City or by any other person or persons claiming the same by, through or under the City.

Section 6.04.    Cooperation in Applications for Permits and Licenses.  In the event it may be necessary for the proper performance of this Agreement on the part of the City or the Company that any application or applications for any permit or license to do or to perform certain things be made to any governmental or other agency by or on behalf of the Company or the City, the Company and the City each agree, upon the request of either, to execute such application or applications.

Section 6.05.    Reserved.

Section 6.06.    City's Access to Facilities.  The Company agrees that the City shall have the right, upon appropriate prior notice to the Company, to have reasonable access to the Facilities owned or leased by the Company during normal business hours for the purpose of making examinations and inspections of the same; provided, however, that the Company reserves the right to restrict access to any of its generating facilities in accordance with reasonably adopted procedures relating to safety and security.

Section 6.07.    Tax Covenants.  The Company covenants that it will not take any action or fail to take any action reasonably within its control which would, under the Code, Regulations of the Department of the Treasury of the United States of America (including Temporary Regulations and Proposed Regulations) under the Code applicable to the Bonds, rulings and court decisions cause the interest payable on the Bonds to be includable in gross income of the holders thereof for Federal income tax purposes (other than a “substantial user” of the Facilities or a “related person” as those terms are used in Section 147(a) of the Code).

The Company covenants that it will pay to the United States of America, on behalf of the City, at or before the times required by or under Section 148(f) of the Code, the amounts required to cause to be met with respect to the Bonds the rebate requirement of said Section and such rules and regulations applicable to the Bonds.  The Company covenants that in directing the investment of the gross proceeds of the Bonds it will comply with the applicable requirements of Section 148 of the Code.  The Company covenants that it will maintain on behalf of the City such records and file such reports, and file copies thereof with the City and, if requested by the Trustee, with the Trustee, as may be necessary to be maintained to demonstrate compliance with this paragraph.
Section 6.08.    Credit Facility.

(a)In order to provide credit support for the payment of all or a portion of the obligations of the Company under Section 5.02 or 10.01(a) hereof, or both, the Company 

19

may, but shall not be obligated to, provide a Credit Facility at any time, and from time to time.  Subject to the provisions of subsections (c) and (d) of this Section 6.08, the Company may at any time, and from time to time, terminate, or cause or allow to be terminated or to expire any such Credit Facility.  The Company hereby authorizes and directs the Trustee to draw moneys under the Credit Facility, if any, in accordance with the terms thereof and of the Ordinance.

(b)Any Credit Facility, at the option of the Company, may provide that drawings may be made thereunder to pay to the Trustee, in accordance with the terms thereof, (i) an amount equal to (A) the principal of the Bonds when due upon maturity, redemption or acceleration and (B) the portion of the purchase price of Bonds purchased pursuant to Section 14.03b(iii) of the Ordinance equal to the principal amount thereof; (ii) an amount equal to a specified number of days' interest, computed at the Maximum Interest Rate (as defined in the Ordinance), on the Bonds to pay (A) accrued and unpaid interest on the Bonds and (B) the portion of the purchase price of Bonds purchased pursuant to Section 14.03b(iii) of the Ordinance equal to the accrued interest thereon; (iii) any part of the portion of the purchase price of Bonds purchased pursuant to Section 14.03b(iii) of the Ordinance corresponding to redemption premium on the Bonds; and, (iv) an amount to pay redemption premium, if any, on the Bonds which may be payable upon the redemption thereof.  The Credit Facility shall be reduced to the extent of any drawings thereunder and reinstated in accordance with the terms thereof.

The Company may, at its election, provide for one or more extensions of any Credit Facility in accordance with the terms of the Reimbursement Agreement in respect thereof.
(c)On or prior to the 35th day preceding the mandatory purchase date occurring pursuant to Section 4.08(c) of the Ordinance, the Company shall deliver to the Trustee, the Tender Agent, the Remarketing Agent and the Bank:

(i)a notice which (A) states the effective date of expiration or termination of the existing Credit Facility, (B) describes any substitute Credit Facility which may be provided in lieu thereof, and (C) directs the Trustee, after taking such actions thereunder as are required to be taken to provide moneys due under the Ordinance in respect of the Bonds or the purchase thereof, to surrender the Credit Facility to expire or to be terminated to the obligor thereon on the effective date of the substitute Credit Facility to be provided in lieu of the Credit Facility to expire or to be terminated or, if no such Credit Facility is to be so provided, on the effective date of such expiration or termination; and
(ii)written evidence from Moody's, if the Bonds are then rated by Moody's, and S&P, if the Bonds are then rated by S&P, of the action that such rating agency will take with respect to the rating assigned to the Bonds on such expiration or termination and delivery of a new Credit Facility, if any.

(d)On or prior to the 35th day preceding the effective date of expiration or termination of any Credit Facility and the substitution of another Credit Facility that does not result in a downgrading or withdrawal of any rating assigned to the Bonds, the 

20

Company shall deliver to the Trustee, the Tender Agent, the Remarketing Agent and the Bank:

(i)a notice which (A) states the effective date of expiration or termination of the existing Credit Facility, (B) describes the Credit Facility which is to be provided in lieu thereof, and (C) directs the Trustee to surrender the Credit Facility to expire or to be terminated to the obligor thereon on the effective date of the substitute Credit Facility to be provided in lieu of the Credit Facility to expire or to be terminated; and

(ii)written evidence from Moody's, if the Bonds are then rated by Moody's, and S&P, if the Bonds are then rated by S&P, that such expiration or termination and delivery of a new Credit Facility will not result in a downgrading or withdrawal of the rating assigned to the Bonds by such rating agency.

(e)In connection with any termination of a Credit Facility and/or the provision of a new Credit Facility, if any, the Company also shall furnish to the Trustee a Favorable Opinion of Bond Counsel (as defined in the Ordinance) and such other opinions of counsel as to such other matters as the City or the Trustee may request.

(End of Article VI)

ARTICLE VII.

ASSIGNMENT, LEASING AND SELLING

Section 7.01.    Assignment, Leasing or Selling of the Facilities by the City.  Except as provided in Article V of this Agreement, the City will not sell, lease, assign, transfer, convey or otherwise dispose of its interest in the Project or any portion thereof or interest therein or in the revenues therefrom without the written consent of the Company, nor will it create or suffer to be created any debt, lien or charge thereon, not consented to by the Company, except Permitted Encumbrances.

Section 7.02.Conditions.  The Company may sell, lease or assign its interest in the Facilities, in whole or in part, other than as described in Section 6.02 hereof, provided the purchaser, lessee or assignee shall assume the obligations of the Company hereunder with respect to the operation, maintenance and insurance of its interest in the Facilities.  No such sale, lease or assumption shall relieve the Company of its liability for the payments specified in Section 5.02 hereof and for the performance and observance of the other covenants and agreements on its part herein provided.

Notwithstanding any other provisions to the contrary, nothing in this Article VII shall be deemed to prohibit further sale or lease by the Company of its interest in the Facilities in connection with any authorized financing thereof under the Act; provided, however, that no such sale or lease by the Company of its interest in the Facilities or Plant shall affect the payment obligations of the Company hereunder.

21

Section 7.03.    Instrument Furnished to Trustee.  The Company shall, within 15 days after the delivery thereof, furnish to the City and the Trustee a true and complete copy of the agreements or other documents effectuating any such assignment, lease or sale.

(End of Article VII)

ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES

Section 8.01.    Events of Default.  Each of the following events shall be and is referred to in this Agreement as an “Event of Default”:

(a)failure by the Company to make when due any installment of the Purchase Price of the Project or any payment required under Section 10.01 (a) hereof, which failure shall have resulted in an “Event of Default” under clause (i), (ii) or (iii) of Section 10.01(a) of the Ordinance;

(b)a failure by the Company (i) to pay when due any other payment required to be made under this Agreement or (ii) to observe and perform any other covenant, condition or agreement on its part to be observed or performed, other than as referred to in this Section 8.01, which failure continues for a period of 30 days after written notice, specifying such failure and requesting that it be remedied, is given to the Company by the City or the Trustee, which may give such notice in its discretion and shall give such notice at the written request of the Owners of not less than a majority in principal amount of the Bonds then Outstanding (other than Bonds held by, or on behalf of the Company), unless the City and the Trustee or the City, the Trustee and the Owners of a principal amount of Bonds not less than the principal amount of Bonds the Owners of which requested such notice, as the case may be, shall agree to an extension of such period prior to its expiration; or

(c)the dissolution or liquidation of the Company, or the filing by the Company of a voluntary petition in bankruptcy, or failure by the Company promptly to forestall or lift any execution, garnishment or attachment of such consequence as will impair its ability to continue its business or to make any payments under this Agreement, or the entry of an order for relief by a court of competent jurisdiction in any proceeding for its liquidation or reorganization under the provisions of any bankruptcy act or under any similar act which may be hereafter enacted, or an assignment by the Company for the benefit of its creditors, or the entry by the Company into an agreement of composition with its creditors (the term “dissolution or liquidation of the Company”, as used in this clause, shall not be construed to include the cessation of the existence of the Company resulting from a dissolution or liquidation of the Company following a transfer of all or substantially all its assets as an entirety, under the conditions permitting such actions contained in Section 6.02 hereof); or

(d)the occurrence and continuance of an Event of Default under the Ordinance.

22

The City (or the Company, in the case of clause (c)) shall promptly notify the Trustee and the Bank of the occurrence of any Event of Default under this Section 8.01.
Section 8.02.    Force Majeure.  The provisions of Section 8.01(b) hereof are subject to the following limitations:  If by reason of acts of God; strikes, lockouts or other industrial disturbances; acts of public enemies; orders of any kind of the government of the United States or of the State of New Mexico or any department, agency, political subdivision, court or official of any of them, or any civil or military authority; insurrections; riots; epidemics; landslides; lightning; earthquakes; volcanoes; fires; hurricanes; tornados; floods; washouts; droughts; arrests; restraint of government and civil disturbances; explosions; breakage or accident to machinery; or entire failure of utilities; or any cause or event not reasonably under the control of the Company, the Company is unable in whole or in part to carry out any one or more of its agreements or obligations contained herein other than its obligations under Sections 5.02, 5.04, 5.08, 5.12, 6.02, 8.05 and 10.01(a) hereof, the Company shall not be deemed in default by reason of not carrying out said agreement or agreements or performing said obligation or obligations during the continuance of such inability.  The Company shall use reasonable efforts to remedy the cause or causes preventing it from carrying out its agreements; provided, that the settlement of strikes, lockouts and other industrial disturbances shall be entirely within the discretion of the Company, and the Company shall not be required to make settlement of strikes, lockouts and other disturbances by acceding to the demands of the opposing party or parties when such course is, in the judgment of the Company, unfavorable to the Company.

Section 8.03.    Remedies.

(a)Upon the occurrence and continuance of any Event of Default described in Section 8.01 hereof, and further upon the condition that, in accordance with the terms of the Ordinance, the Bonds shall have been declared to be immediately due and payable pursuant to any provision of the Ordinance, the unpaid balance of the Purchase Price of the Project shall, without further action, become and be immediately due and payable.

Any waiver of any “Event of Default” under the Ordinance and a rescission and annulment of its consequences shall constitute a waiver of the corresponding Event or Events of Default under this Agreement and a rescission and annulment of the consequences thereof.
(b)Upon the occurrence and continuance of any Event of Default, the City may take, or cause to be taken, any action at law or in equity to collect any payments then due and thereafter to become due, or to enforce performance and observance of any obligation, agreement or covenant of the Company hereunder.

(c)Any amounts collected from the Company pursuant to this Section 8.03 shall be applied in accordance with the Ordinance.

Section 8.04.    No Remedy Exclusive.  No remedy conferred upon or reserved to the City hereby is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute.  No delay or omission to

23

exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient.  In order to entitle the City to exercise any remedy reserved to it in this Article VIII, it shall not be necessary to give any notice other than such notice as may be herein expressly required.

Section 8.05.    Reimbursement of Attorneys' Fees.  If the Company shall default under any of the provisions hereof (i) and the City or the Trustee shall employ attorneys or incur other reasonable expenses for the collection of payments due hereunder or for the enforcement of performance or observance of any obligation or agreement on the part of the Company contained herein, the Company will on demand therefor reimburse the City or the Trustee, as may be, for the reasonable fees of such attorneys and such other reasonable expenses so incurred, to the extent permitted by law, and (ii) the Company shall pay the Trustee reasonable compensation for extraordinary services, including default administration.

Section 8.06.    Waiver of Breach.  In the event any obligation created hereby shall be breached by either of the parties and such breach shall thereafter be waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder.  In view of the assignment of certain of the City's rights and interests hereunder to the Trustee, the City shall have no power to waive any default hereunder by the Company in respect of such rights and interests without the consent of the Trustee, and the Trustee may exercise any of the rights of the City hereunder.

(End of Article VIII)

ARTICLE IX.

PREPAYMENT OF PURCHASE PRICE OF THE PROJECT

Section 9.01.    Options of Company to Prepay Purchase Price of the Project.

(a)The Company shall have, and is hereby granted, the option to prepay the unpaid balance of the Purchase Price of the Project in whole or in part by causing the Bonds to be called for redemption pursuant to Section 4.01 of the Ordinance in which case all or a portion of the balance of the Purchase Price of the Project shall become due and payable on the redemption date specified pursuant to Section 9.02 hereof in an amount sufficient to pay the principal of any premium, if any, and interest on the Bonds so called for redemption.
(b)The Company shall also have, and is hereby granted, the option to prepay the unpaid balance of the Purchase Price of the Project in whole or in part by causing Bonds to be deemed to have been paid pursuant to Section 9.01 of the Ordinance by depositing with the Trustee moneys or obligations, or a combination thereof, as required by such Section 9.01 and by giving the irrevocable instructions required by such Section 9.01.

24

Section 9.02.    Exercise of Option.

(a)To exercise an option granted in Section 9.01 hereof, the Company shall give written notice to the Trustee which shall designate therein the principal amount of the Bonds to be caused to be redeemed, or to be deemed to be paid in accordance with Section 9.01 of the Ordinance and, in the event a redemption of Bonds is to be effected, such notice shall be given to the Trustee not less than five Business Days (as defined in the Ordinance) prior to the day on which the Trustee shall be required to give notice of any such redemption and shall specify therein (i) the date or dates of redemption and (ii) the applicable redemption provision of the Ordinance.  The exercise of an option granted in Section 9.01 hereof shall be revocable by the Company at any time before the receipt by the Trustee of the portion of the Purchase Price of the Project to be prepaid.

(b)Upon receipt of a notice furnished pursuant to this Section 9.02, the City shall cooperate fully with the Trustee to permit the Trustee to take or cause to be taken all actions required of it under the Ordinance to cause Bonds to be paid or redeemed in accordance with such notice.

(c)In the event the Company exercises its rights to cause the Bonds to be redeemed or deemed to have been paid as provided in Section 9.01 hereof, it shall give the Trustee directions to draw moneys under the applicable Credit Facility in accordance with the terms hereof and of the Ordinance in the amounts so specified by the Company in such direction or order to effect the redemption of the Bonds entitled to the benefits of the Credit Facility or cause such Bonds to be deemed to have been paid as provided in Section 9.01 of the Ordinance.

Section 9.03.    Mandatory Prepayment of Purchase Price of the Project.  The Company shall prepay the necessary portion of the unpaid balance of the Purchase Price of the Project on such dates on which the Bonds are required to be redeemed pursuant to the Ordinance.

(End of Article IX)

ARTICLE X.

PURCHASE AND REMARKETING OF BONDS

Section 10.01.    Purchase of Bonds.

(a)In consideration of the issuance of the Bonds by the City, but for the benefit of the Owners of the Bonds, the Company does hereby covenant and agree to cause the necessary arrangements to be made and to be thereafter continued whereby, from time to time, the Bonds will be purchased from the Owners thereof under the circumstances provided in Section 4.08 of the Ordinance.  In furtherance of the foregoing covenant of the Company, the City, at the direction of the Company, has set forth in Section 4.08 of the Ordinance the terms and conditions relating to such purchases and has set forth in Article XIV of the Ordinance the duties and responsibilities of the Tender Agent with respect to the purchase of Bonds and of the Remarketing Agent with respect to the remarketing of Bonds.  At the direction of the Company, U.S. Bank Municipal 

25

Securities Group, a division of U.S. Bank National Association, has been designated as the initial Remarketing Agent and Union Bank as the initial Tender Agent and the Company hereby authorizes and directs the Tender Agent and the Remarketing Agent to purchase, offer, sell and deliver Bonds in accordance with the provisions of Section 4.08 and Article XIV of the Ordinance.

Without limiting the generality of the foregoing covenant of the Company, and in consideration of the City's having set forth in the Ordinance the aforesaid provisions of Section 4.08 and Article XIV thereof, the Company covenants, for the benefit of the Owners of the Bonds, to pay, or cause to be paid, to the Tender Agent such amounts as shall be necessary to enable the Tender Agent to pay the purchase price of Bonds, all as more particularly described in Section 4.08 and Article XIV of the Ordinance.

(b)The City shall have no obligation or responsibility financial or otherwise, with respect to the purchase or remarketing of Bonds or the making or continuation of arrangements therefor, except that the City shall generally cooperate with the Company, the Trustee, the Tender Agent and the Remarketing Agent as contemplated in Article XIV of the Ordinance.

Section 10.02.    Optional Purchase of Bonds.  Subject to the limitations of the Ordinance, the Company, at any time and from time to time, may furnish moneys to the Tender Agent accompanied by a notice directing that such moneys be applied to the purchase of Bonds to be purchased pursuant to Section 4.08 and Article XIV of the Ordinance.  Bonds so purchased shall be delivered to the Company in accordance with Section 14.05(i) of the Ordinance.

Section 10.03.    Determination of Interest Rate Periods.  The Company may determine the duration and type of the Interest Rate Periods and certain other provisions relating to Interest Rate Periods as, and to the extent, set forth in Section 2.01 of the Ordinance.

(End of Article X)

ARTICLE XI.

MISCELLANEOUS

Section 11.01.    Term of Agreement.  This Agreement shall remain in full force and effect from the date hereof until the right, title and interest of the Trustee in and to the Trust Estate shall have ceased, terminated or become void in accordance with Article IX of the Ordinance and until all payments required under this Agreement shall have been made.

Section 11.02.    Notices.  All notices, certificates, requests or other communications hereunder shall be sufficiently given and shall be deemed given when delivered or telecopied or if mailed, when mailed by registered mail, postage prepaid, addressed as follows:

If to the City:                City of Farmington
City Hall
800 Municipal Drive
Farmington, New Mexico 87401
                    

26

	
		
	 
	Attention:  City Treasurer

	 
	 

	If to the Company:
	El Paso Electric Company
100 North Stanton
El Paso, Texas 79901
Attention:  Treasurer

	 
	 

	If to the Trustee:
	Union Bank
120 South San Pedro Street, 4th Fl.
Los Angeles, California 90012
Attention:  Corporate Trust

	 
	 

	If to the Remarketing Agent:
	U.S. Bank Municipal Securities Group, a division of U.S. Bank National Association
461 Fifth Avenue, 10th Fl.
New York, New York 10017
Attention:  Kevin Stowe

	 
	 

	If to the Tender Agent:
	Union Bank
120 South San Pedro Street, 4th Fl.
Los Angeles, California 90012
Attention:  Corporate Trust

	 
	 

A copy of each notice, certificate, request or other communication given hereunder to the City, the Company, the Trustee, the Bank, the Tender Agent or the Remarketing Agent shall also be given to the others.  The City, the Company, the Trustee, the Bank, the Tender Agent and the Remarketing Agent may, by notice given hereunder, designate further or different addresses to which subsequent notices, certificates, requests or other communications shall be sent.  Such notice shall be given to all others listed above.
Section 11.03. Parties in Interest.  This Agreement shall inure to the benefit of and shall be binding upon the City, the Company and their respective successors and assigns, and no other person, firm or corporation, other than the Owners, the Trustee, the Registrar or the Paying Agent under the Ordinance, the Tender Agent, the Remarketing Agent and the Bank, shall have any right, remedy or claim under or by reason of this Agreement; provided, however, that the obligations of the Company under Section 5.08 hereof shall inure to the benefit of the persons specified therein, and such obligations shall be enforceable by such persons as a third-party beneficiary; and subject to the limitation that any obligation of the City created by or arising out of this Agreement shall not be a general debt of the City, but shall be payable solely out of the revenues derived from this Agreement or the sale of the Bonds or income earned on invested funds as provided herein and in the Ordinance.

Section 11.04. Extent of Covenants of the City; No Personal Liability.  All covenants, obligations and agreements of the City contained in this Agreement or the Ordinance shall be effective to the extent authorized and permitted by applicable law.  No such covenant, obligation or agreement shall be deemed to be a covenant, obligation or agreement of any official, officer, agent, or employee of the City in other than his official capacity, and neither the members of the 

27

City Council nor any official executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof or by reason of the covenants, obligations or agreements of the City contained in this Agreement or in the Ordinance.

Section 11.05. Confirmation of Request by the Company.  The Company hereby confirms that it has requested that the City adopt an ordinance in the form and to the effect of the Ordinance including, without limitation, all of the terms and provisions relating to the Bonds, the Trustee, Paying Agent, Registrar, Remarketing Agent and Tender Agent and designating the parties named therein as Trustee, Paying Agent, Registrar, Remarketing Agent and Tender Agent.

Section 11.06. Amendments.  This Agreement may be amended only by written agreement of the parties hereto with the consent of the Bank or the provider of any other Credit Facility, for so long as the Credit Facility is in effect, subject to the limitations set forth herein and in the Ordinance.

Section 11.07. Counterparts.  This Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall be an original; but such counterparts shall together constitute but one and the same Agreement.

Section 11.08. Severability.  If any clause, provision or section of this Agreement shall, for any reason, be held illegal or invalid, such illegality or invalidity shall not affect any other provision of this Agreement, and this Agreement shall be construed and enforced as if such illegal or invalid provisions had not been contained herein.

Section 11.09. Governing Law.  The laws of the State of New Mexico shall govern the construction of this Agreement.

(End of Article XI)

[Signature page follows]

28

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written.
CITY OF FARMINGTON, as Vendor
(Seal)
By:      /s/ Tommy Roberts              
Mayor

Attest:
     /s/ Dianne Fuhrman           
City Clerk

EL PASO ELECTRIC COMPANY, as Vendee

By:       /s/ Steven P. Busser                  
        Title:   Steven P. Busser
        Vice President and Treasurer

FURTHER AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT

    

STATE OF NEW MEXICO    )
)  ss.
COUNTY OF SAN JUAN    )
On this 26th day of July 2012, before me personally came Tommy Roberts to me known, who, being by me duly sworn, did depose and say that he resides at Farmington; that he is the Mayor of the City of Farmington, New Mexico, an incorporated municipality of the state of New Mexico, the municipality described in and which executed the above instrument; that he knows the seal of said municipality; that the seal affixed to said instrument is such seal; that it was so affixed by authority of the City Council of said municipality; and that he signed his name thereto by like authority.
[Notarial Seal Affixed]
     /s/ Melody A. Coyner                  
Notary Public

[Notarial Stamp]

FURTHER AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT

STATE OF TEXAS        )
)  ss.
COUNTY OF EL PASO    )
On this 26th day of July, before me personally came Steven P. Busser, who, being by me duly sworn, did depose and say that he resides El Paso County; that he is the Vice President and Treasurer of El Paso Electric Company, a Texas corporation, the corporation described in and which executed the above instrument; and that he signed his name to said instrument by authority of the Board of Directors of such corporation.
[Notarial Seal Affixed]
     /s/ Norma Jean Ayoub           
Notary Public

[Notarial Stamp]

FURTHER AMENDED AND RESTATED INSTALLMENT SALE AGREEMENT

EXHIBIT A

DESCRIPTION OF THE FACILITIES
The Facilities consist of various systems, machinery and equipment at Units 4 and 5 of the Plant and certain common facilities related to all five Units of the Plant, which may be generally described as follows:
A.    Particulate Removal System.  The particulate removal system is designed for the purpose of removing fly ash emissions from flue gas.  This system includes a flue gas draft system, fabric filter baghouses and a fly ash handling system.
B.    Low Volume Waste Water System.  The low volume waste water system is designed to reduce the suspended solids in, and remove the oil from, contaminated waste water streams, including hydrobin discharges and coal pile runoff, and to dispose of them through a new treatment pond.  The system includes open trenches intercepting waste discharges, a waste sump, pumping equipment, the treatment pond, an overflow spillway for discharge of clean water to Lake Morgan and a pipeline to divert acid wash to the ash ponds.
C.    Sulfur Dioxide Removal System.  The sulfur dioxide removal system is designed to remove sulfur dioxide emissions from flue gas.  This system to remove sulfur dioxide from flue gases includes vertical spray tower absorber modules with mist eliminators, lime slakers and other lime handling facilities, a thickening and polymer system, a secondary dewatering and sludge stabilization system, sludge and ash transport facilities and related mixers, tanks, pipes, pumps, silos, ducts and structures.  The system also includes mechanical, electrical, instrumentation and control systems to permit the operation of the system in accordance with environmental requirements and a new stack.
D.    Sanitary Sewer System.  The sanitary sewer system is designed to upgrade the quality of water discharge from the sanitary sewer system.

EXHIBIT B
LIST OF THE COMPANY'S AFFILIATES
Mirasol Energy Services, Inc.Exhbit 4.05 Indenture of Trust

                                             Exhibit 4.05
                                                                                                                                                                               
INDENTURE OF TRUST
between
MARICOPA COUNTY, ARIZONA POLLUTION CONTROL CORPORATION
and
UNION BANK, N.A., 
as Trustee
Dated as of August 1, 2012
Relating to
$59,235,000
Maricopa County, Arizona Pollution Control Corporation 
Pollution Control Refunding Revenue Bonds
2012 Series A
(El Paso Electric Company Palo Verde Project)

1

	
				
	TABLE OF CONTENTS

	 
	 
	Page

	ARTICLE I DEFINITIONS

	Section 1.01
	Definitions
	3
	

	Section 1.02
	Number and Gender
	13
	

	Section 1.03
	Articles, Sections, Etc.
	13
	

	Section 1.04
	Content of Certificates and Opinions
	13
	

	Section 1.05
	Findings
	13
	

	ARTICLE II THE BONDS

	Section 2.01
	Authorization and Terms of Bonds
	14
	

	Section 2.02
	Execution of Bonds
	27
	

	Section 2.03
	Transfer and Exchange of Bonds
	28
	

	Section 2.04
	Bond Register
	29
	

	Section 2.05
	Bonds Mutilated Lost Destroyed or Stolen
	29
	

	Section 2.06
	Disposition of Cancelled Bonds
	30
	

	Section 2.07
	CUSIP Number
	30
	

	Section 2.08
	Other Obligations
	30
	

	Section 2.09
	Temporary Bonds
	30
	

	ARTICLE III ISSUANCE OF BONDS

	Section 3.01
	Authentication and Delivery of Bonds
	31
	

	Section 3.02
	Application of Proceeds of Bonds
	31
	

	Section 3.03
	Payment of Principal and Interest
	31
	

	ARTICLE IV REDEMPTION AND PURCHASE OF BONDS

	Section 4.01
	Redemption of Bonds
	32
	

	Section 4.02
	Selection of Bonds to be Redeemed
	35
	

	Section 4.03
	Notice for Redemption
	35
	

	Section 4.04
	Partial Redemption of Bonds
	36
	

	Section 4.05
	Effect of Redemption
	37
	

	Section 4.06
	Payment of Redemption Price
	37
	

	Section 4.07
	Reserved
	37
	

	Section 4.08
	Purchase of Bonds
	38
	

	Section 4.09
	Delivery of Tendered Bonds
	40
	

	Section 4.10
	Bonds Deemed Purchased
	40
	

	Section 4.11
	Reserved
	41
	

	Section 4.12
	Purchase in Lieu of Redemption
	41
	

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

i

	
				
	 
	 
	 

	ARTICLE V THE BOND FUND

	Section 5.01
	Creation of Bond Fund
	41
	

	Section 5.02
	Deposits into Bond Fund
	41
	

	Section 5.03
	Use of Moneys in Bond Fund
	42
	

	Section 5.04
	Credit Facility
	43
	

	Section 5.05
	Custody of Bond Fund; Withdrawal of Moneys
	44
	

	Section 5.06
	Bonds Not Presented for Payment
	44
	

	Section 5.07
	Moneys Held in Trust
	45
	

	Section 5.08
	Payment to the Bank and to the Borrower
	45
	

	ARTICLE VI PURCHASE FUND

	Section 6.01
	Tender Agent
	45
	

	Section 6.02
	Notice of Bonds Delivered for Purchase; Purchase of Bonds
	46
	

	ARTICLE VII INVESTMENTS

	Section 7.01
	Investments
	48
	

	ARTICLE VIII GENERAL COVENANTS

	Section 8.01
	Limited Obligation; Payment of Principal and Interest
	49
	

	Section 8.02
	Performance of Agreements; Authority
	49
	

	Section 8.03
	Maintenance of Corporate Existence; Compliance with Laws
	49
	

	Section 8.04
	Enforcement of Borrower’s Obligations under the Agreement
	50
	

	Section 8.05
	Further Assurances
	50
	

	Section 8.06
	No Disposition or Encumbrance of Issuer’s Interests
	50
	

	Section 8.07
	Trustee’s Access to Books Relating to Facilities
	50
	

	Section 8.08
	Filing of Financing Statements
	50
	

	Section 8.09
	Tax Covenant
	51
	

	Section 8.10
	Notices by Trustee
	51
	

	Section 8.11
	No Transfer of Credit Facility
	51
	

	ARTICLE IX DEFEASANCE

	Section 9.01
	Defeasance
	51
	

	Section 9.02
	Survival of Certain Provisions
	53
	

	ARTICLE X DEFAULTS AND REMEDIES

	Section 10.01
	Events of Default
	53
	

	Section 10.02
	Remedies
	56
	

	Section 10.03
	Restoration to Former Position
	56
	

	Section 10.04
	Reserved
	56
	

	Section 10.05
	Limitation on Owners’ Right to Institute Proceedings
	56
	

	Section 10.06
	No Impairment of Right to Enforce Payment
	57
	

	Section 10.07
	Proceeding by Trustee Without Possession of Bonds
	57
	

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

ii

	
				
	Section 10.08
	No Remedy Exclusive
	57
	

	Section 10.09
	No Waiver of Remedies
	57
	

	Section 10.10
	Application of Moneys
	57
	

	Section 10.11
	Severability of Remedies
	59
	

	Section 10.12
	Waivers of Events of Default
	59
	

	Section 10.13
	No Obligation of Issuer to Act
	60
	

	ARTICLE XI TRUSTEE, PAYING AGENT, REGISTRAR

	Section 11.01
	Acceptance of Trusts
	60
	

	Section 11.02
	Trustee Not Responsible for Recitals, Maintenance, Insurance, etc.
	60
	

	Section 11.03
	Limitations on Liability
	60
	

	Section 11.04
	Compensation, Expenses and Advances
	61
	

	Section 11.05
	Notice of Events of Default
	62
	

	Section 11.06
	Action by Trustee
	62
	

	Section 11.07
	Good Faith Reliance
	62
	

	Section 11.08
	Dealings in Bonds and with the Issuer and the Borrower
	63
	

	Section 11.09
	Several Capacities
	63
	

	Section 11.10
	Construction of Indenture
	63
	

	Section 11.11
	Resignation of Trustee
	63
	

	Section 11.12
	Removal of Trustee
	64
	

	Section 11.13
	Appointment of Successor Trustee
	64
	

	Section 11.14
	Qualifications of Successor Trustee
	64
	

	Section 11.15
	Judicial Appointment of Successor Trustee
	65
	

	Section 11.16
	Acceptance of Trusts by Successor Trustee
	65
	

	Section 11.17
	Successor by Merger or Consolidation
	65
	

	Section 11.18
	Standard of Care
	65
	

	Section 11.19
	Notice of Event of Default
	66
	

	Section 11.20
	Intervention in Litigation
	66
	

	Section 11.21
	Paying Agent
	66
	

	Section 11.22
	Qualifications of Paying Agent; Resignation; Removal
	66
	

	Section 11.23
	Registrar
	67
	

	Section 11.24
	Qualifications of Registrar; Resignation; Removal
	67
	

	Section 11.25
	Appointment of Co-Trustee
	68
	

	Section 11.26
	Notices to Rating Agencies
	69
	

	ARTICLE XII EXECUTION OF INSTRUMENTS BY  OWNERS AND PROOF OF OWNERSHIP OF BONDS

	Section 12.01
	Execution of Instruments Proof of Ownership
	69
	

	ARTICLE XIII MODIFICATION OF INDENTURE DOCUMENTS

	Section 13.01
	Limitations
	70
	

	Section 13.02
	Modification without Consent of Owners
	70
	

	Section 13.03
	Modification with Consent of Owners
	71
	

	Section 13.04
	Effect of Supplemental Indenture
	72
	

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

iii

	
				
	Section 13.05
	Consent of the Borrower and the Bank
	72
	

	Section 13.06
	Amendment of Agreement without Consent of Owners
	72
	

	Section 13.07
	Amendment of Agreement with Consent of Owners
	73
	

	Section 13.08
	Issuance of Bonds Under Other Indentures: Recognition of Prior Pledges
	73
	

	ARTICLE XIV REMARKETING AGENT; TENDER AGENT;  PURCHASE AND REMARKETING OF BONDS

	Section 14.01
	Remarketing Agent and Tender Agent
	74
	

	Section 14.02
	Qualifications of Remarketing Agent and Tender Agent; Resignation; Removal
	74
	

	Section 14.03
	Remarketing of Bonds; Notice of Interest Rates
	75
	

	Section 14.04
	Delivery of Bonds
	75
	

	Section 14.05
	Drawings on Credit Facility
	77
	

	Section 14.06
	Delivery of Proceeds of Sale
	77
	

	ARTICLE XV MISCELLANEOUS

	Section 15.01
	Indenture to Bind and Inure to Benefit of Successors to Issuer
	77
	

	Section 15.02
	Parties in Interest
	78
	

	Section 15.03
	Severability
	78
	

	Section 15.04
	No Personal Liability of Issuer Under Indenture
	78
	

	Section 15.05
	Bonds Owned by the Issuer or the Borrower
	78
	

	Section 15.06
	Governing Law
	78
	

	Section 15.07
	Notices
	79
	

	Section 15.08
	Non-Business Days
	80
	

	Section 15.09
	Opinions
	80
	

	Section 15.10
	Headlines; Table of Contents
	80
	

	Section 15.11
	Execution in Several Counterparts
	80
	

	Section 15.12
	Statutory Notice
	80
	

	 
	 
	 

	Exhibit A – Form of Bond
	A-1

iv

THIS INDENTURE OF TRUST is made and entered into as of August 1, 2012, by and between MARICOPA COUNTY, ARIZONA POLLUTION CONTROL CORPORATION, an Arizona nonprofit corporation designated as a political subdivision under the laws of the State of Arizona incorporated for and with the approval of the County of Maricopa, Arizona, pursuant to the provisions of the Constitution of the State of Arizona and Title 9, Chapter 12, Arizona Revised Statutes, enacted by Chapter 69, Section 2, Laws of Arizona of 1972, renumbered as Title 35, Chapter 6, Arizona Revised Statutes, by Chapter 281, Section 2, Laws of Arizona of 1986, and all acts supplemental thereto or, amendatory thereof (hereinafter, together with any successor to its functions, called the “Issuer”), and Union Bank, N.A., a national banking association authorized to exercise corporate trust powers, with a principal corporate trust office in Los Angeles, California (hereinafter, together with any successor in such capacity, called the “Trustee”).
W I T N E S S E T H:
WHEREAS, Title 35, Chapter 6, Arizona Revised Statutes (formerly Title 9, Chapter 12, Arizona Revised Statutes, enacted by Chapter 69, Section 2, Laws of Arizona of 1972), as amended (hereinafter called the “Act”), empowers any pollution control corporation organized pursuant to Article 1 of the Act to issue revenue bonds in accordance with Article 2 of the Act and to make secured or unsecured loans for the purpose of financing or refinancing the acquisition, construction, improvement or equipping of pollution control facilities, to charge and collect interest on such loans and pledge the proceeds of loan agreements as security for the payment of the principal of and interest on bonds, or designated issues of bonds, issued by the corporation and any agreements made in connection therewith, whenever the board of directors finds such loans to be in furtherance of the purposes of the corporation; and
WHEREAS, Chapter 69, Section 1, Laws of Arizona of 1972, declares it to be the purpose of the Act to authorize the incorporation in the several municipalities and counties of the State of Arizona of corporations which shall constitute political subdivisions of the State, to finance the acquisition and installation of, or the construction and leasing of, properties, machinery and equipment intended to prevent or limit air, water and other forms of pollution for the purpose of protecting the health and welfare of the citizens of the State of Arizona, and to facilitate compliance with existing or future air, water and other quality standards designed to improve the environment, and declares that such corporations shall serve a public purpose and perform an essential governmental function; and
WHEREAS, in response to an application by four qualified electors of the County of Maricopa, Arizona (the “County”), a political subdivision of the State of Arizona, the Board of Supervisors of said County on December 5, 1983, adopted a resolution by which it determined that it was wise, expedient, advisable and in the public interest that said application be approved, approved said application, and authorized said four electors to proceed with the incorporation of the Issuer as a pollution control corporation for said County, all in accordance with Section 35¬802 of the Act to issue bonds and to carry out the other functions and fulfill the purposes of the Issuer; and
WHEREAS, the Issuer was thereupon organized and incorporated in accordance with the provisions of the Act, and, on December 5, 1983, the Articles of Incorporation of the Issuer were 

filed with the Arizona Corporation Commission, in accordance with Section 35-809 of the Act; and
WHEREAS, the Issuer has heretofore issued and sold its $59,235,000 aggregate principal amount of Pollution Control Refunding Revenue Bonds, 2005 Series A (El Paso Electric Company Palo Verde Project) (the “Prior Bonds”), the proceeds of which were used to refinance a portion of the costs of acquisition, construction, improvement or equipping of the Project; and
WHEREAS, the Board of Directors of the Issuer on June 14, 2012 determined to sell additional revenue bonds of the Issuer to provide the moneys necessary to redeem and refund the outstanding principal amount of the Prior Bonds; and
WHEREAS, appropriate certifications have been received stating that the portion of the Generating Station which constitutes the pollution control facilities, as described in Exhibit A to the Agreement (defined below) (the “Generating Station”), as designed, are in furtherance of the purpose of abating or controlling atmospheric or water pollutants or contaminants resulting from the generation of electricity at the Generating Station; and
WHEREAS, the Issuer and the Borrower have executed and delivered that certain Loan Agreement, dated as of August 1, 2012 (hereinafter called the “Agreement”), setting forth the undertaking by the Issuer to issue and sell its revenue bonds under the Act (hereinafter called the “Bonds”), and to lend the proceeds of the Bonds to the Borrower to provide a portion of the moneys necessary to redeem and refund the outstanding principal amount of Prior Bonds; and
WHEREAS, in the Agreement the Borrower releases the Issuer and agrees that the Issuer shall not be liable for, and will indemnify and hold the Issuer and the Trustee harmless from, certain matters; and
WHEREAS, certain findings and determinations relating to the Agreement and the Generating Station and the Project have heretofore been made and are set forth in this Indenture; and
WHEREAS, the execution and delivery of the Agreement and this Indenture and the issuance of the Bonds have been in all respects duly and validly authorized, and duly adopted and approved by resolutions of the Board of Directors of the Issuer, and the Project, the plan of financing for the Project and the issuance of the Bonds have been duly approved by the Board of Supervisors of the County, as required by the Act and otherwise; and
WHEREAS, all other things necessary to make the Bonds, when issued, executed and delivered by the Issuer and authenticated by the Trustee pursuant to this Indenture, the valid, legal and binding limited obligations of the Issuer, and to constitute this Indenture a valid pledge and assignment of all right, title and interest of the Issuer in the Agreement (except as to certain payments to the Issuer under provisions for indemnification of, and reimbursement of expenses of, the Issuer), and of certain income and revenues derived from the Agreement, for the payment of the principal of and interest on the Bonds authenticated and delivered under this Indenture, and the creation, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized;

2

NOW, THEREFORE, the Issuer, in consideration of the covenants herein contained and of the purchase and acceptance of the Bonds by the holders thereof, in order to secure the payment of all Bonds at any time Outstanding under this Indenture, according to their tenor and effect, and the performance and observance of all the covenants and conditions in the Bonds and herein contained, and to declare the terms and conditions upon and subject to which the Bonds are issued and secured, does grant a security interest in and pledge to the Trustee (as hereinafter defined), and to its successors and assigns forever, the Trust Estate (as hereinafter defined) for the equal and proportionate benefit, security and protection of all holders and owners of the Bonds issued under and secured by this Indenture without privilege, priority or distinction as to the lien or otherwise of any of the Bonds over any other of the Bonds, all upon the terms stated in this Indenture.
ARTICLE I
DEFINITIONS
Section 1.02Definitions.  The terms defined in this Article I shall, for all purposes of this Indenture and of any supplemental indenture hereto have the meanings herein specified, unless the context clearly requires otherwise.  Capitalized terms used herein, defined in the Agreement and not otherwise defined herein, shall have the meaning specified in the Agreement.
“Act” shall mean Title 35, Chapter 6, Arizona Revised Statutes (formerly Title 9, Chapter 12, Arizona Revised Statutes, enacted by Chapter 69, Section 2, Laws of Arizona of 1972), and all acts supplemental thereto or amendatory thereof.
“Agreement” shall mean the Loan Agreement, of even date herewith, between the Issuer and the Borrower and relating to the loan of the proceeds of the Bonds, as originally executed or as it may from time to time be supplemented or amended.
“Alternate Credit Support” shall mean any letter of credit, credit facility, insurance policy, guarantee or other credit support agreement or security mechanism provided by the Borrower in accordance with Section 6.08 of the Agreement and any extension thereof.
“Authorized Borrower Representative” shall mean each person at the time designated to act on behalf of the Borrower by written certificate furnished to the Issuer and the Trustee containing the specimen signature of such person and signed on behalf of the Issuer.
“Authorized Denominations” shall mean (a) with respect to any Long-Term Interest Rate Period, $5,000 and any integral multiple thereof; and (b) with respect to any Daily Interest Rate Period, Weekly Interest Rate Period or Short-Term Interest Rate Period, $100,000 and any integral multiple of $5,000 in excess of $100,000.
“Available Moneys” shall mean (i) with respect to any date occurring during the term of a Credit Facility, (a) proceeds of a drawing under a Credit Facility which have been directly deposited in the Bond Fund or the Purchase Fund, as applicable, (b) moneys deposited in the Bond Fund or the Purchase Fund by or on behalf of the Borrower and which have been on deposit with the Trustee or the Tender Agent, as applicable, for at least one hundred and twenty-four (124) days prior to and during which no petition by or against the Issuer or the Borrower or 

3

any affiliate of the Borrower, under any Bankruptcy Act shall have been filed or any bankruptcy or similar proceeding shall have been commenced, unless such petition or proceeding shall have been dismissed and such dismissal shall be final and not subject to appeal, (c) any other money (including the proceeds of the sale of refunding obligations of the Issuer) the application of which would not, in the written opinion of Bond Counsel or other nationally recognized counsel experienced in bankruptcy matters and acceptable to the Issuer, the Rating Agencies, if any, and the Trustee and delivered to the Trustee and the Tender Agent, constitute a voidable preference in the case of a filing for protection under the Bankruptcy Act of the Issuer or the Borrower or any affiliate of the Borrower, and (d) the proceeds from the investment of moneys described above, and (ii) with respect to any date not occurring during the term of a Credit Facility, any moneys furnished to the Trustee or the Tender Agent, as applicable, and the proceeds from the investment thereof.
“Bank” shall mean the issuer of a Letter of Credit, if any, with respect to the Bonds, and, any subsequently issued Credit Facility, the issuer of such other Credit Facility so long as such other Credit Facility shall be in effect, in its capacity as such issuer, its successors in such capacity and their assigns.
“Bankruptcy Act” shall mean the United States Bankruptcy Code, any successor act thereto or amendment thereof or any other applicable federal or state bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law, now or hereafter in effect.
“Beneficial Owner” shall mean any Person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bond (including any Person holding a Bond through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bond for federal income tax purposes.
“Bond” or “Bonds” shall mean the bonds issued in accordance with this Indenture as referenced in Section 2.01(a).
“Bond Counsel” shall mean Katten Muchin Rosenman LLP, New York, New York or any firm of nationally recognized bond counsel which is experienced in the financing of pollution control facilities and acceptable to the Issuer, the Remarketing Agent, the Trustee and the Borrower.
“Bond Fund” shall mean the fund created by Section 5.01 hereof.
“Bond Interest Term” or “BIT” shall mean, with respect to each Bond bearing interest at a BIT Rate, the period established in accordance with the terms of Section 2.01(c)(v) hereof.
“Bond Interest Term Rate” or “BIT Rate” shall mean the interest rate on any Bond established in accordance with Section 2.01(c)(v) hereof.
“Book-Entry Bonds” shall mean any Bonds which are then held in book-entry form as provided in Section 2.01(e) hereof.

4

“Borrower” shall mean (i) El Paso Electric Company, a corporation organized under the laws of the State of Texas and its successors and assigns, and (ii) any surviving, resulting or transferee corporation as provided in Section 6.02 of the Agreement.
“Business Day” shall mean any day other than a Saturday, Sunday or other day on which the New York Stock Exchange, Inc. or banks are authorized or required to close in New York, New York, or in the cities in which the Principal Offices of the Trustee, the Registrar, the Paying Agent, the Tender Agent, if any, and the Remarketing Agent, if any, are located, and in the city or cities in which drawings under a Credit Facility are required to be made.
“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.  Each reference herein to a section of the Code shall be deemed to include the United States Treasury Regulations adopted under the Code, as the same may be in effect from time to time, unless the context clearly requires otherwise.
“Conversion” shall mean a conversion of the Bonds from one Interest Rate Period to another Interest Rate Period (including the establishment of a new interest period within the Long-Term Interest Rate Period) as provided in Sections 2.01(c)(ii)(B), (iii)(B), (iv)(B) or (v)(B) of this Indenture.
“Conversion Date” shall mean the effective date of a Conversion of the Bonds.
“Credit Facility” shall mean, collectively, the Letter of Credit, if any, and any extensions thereof, and, upon the issuance and delivery of any Alternate Credit Support in accordance with Section 6.08 of the Agreement, “Credit Facility” shall mean such Alternate Credit Support.
“County” shall mean the County of Maricopa, Arizona.
“Daily Interest Rate” shall mean the variable interest rate on any Bond established in accordance with Section 2.01(c)(ii) hereof.
“Daily Interest Rate Period” shall mean each period during which a Daily Interest Rate is in effect.
“Default” shall mean any Event of Default or any event or condition which, with the passage of time, or giving of notice or both, would constitute an Event of Default.
“Determination of Taxability” means a determination that, due to the untruth or inaccuracy of any representation or warranty made by the Borrower in the Agreement or the breach of any covenant or warranty of the Borrower contained in the Agreement, interest on the Bonds, or any of them, is determined not to be Tax-Exempt by a final administrative determination of the Internal Revenue Service or a final judicial decision of a court of competent jurisdiction in a proceeding of which the Borrower received notice and in which the Borrower was afforded an opportunity to participate to the full extent permitted by law.  A determination or decision will not be considered final for purposes of the preceding sentence unless (A) the Issuer or the holder or Owners of the Bonds involved in the proceeding in which the issue is raised (i) shall have given the Borrower and the Trustee prompt written notice of the commencement thereof, and (ii) shall have offered the Borrower the opportunity to control the 

5

proceeding; provided the Borrower agrees to pay all expenses in connection therewith and to indemnify such holder or holders against all liability for such expenses (except that any such holder may engage separate counsel, and the Borrower shall not be liable for the fees or expenses of such counsel); and (B) such proceeding shall not be subject to a further right of appeal or shall not have been timely appealed.
“DTC” shall mean The Depository Trust Company, New York, New York.
“Electronic” notice shall mean notice by any form of electronic transmission capable of producing a written record and shall constitute written notice as required herein provided, that for purposes of this Indenture, an e-mail does not constitute a notice, request or other communication hereunder but rather the portable document format or similar attachment attached to such e-mail shall constitute a notice, request or other communication hereunder.
“Event of Default” shall mean any of the events listed in Section 10.01.
“Facilities” or “Project” shall mean the pollution control, solid waste disposal and sewage disposal facilities at the Plant, which are described in Exhibit A to the Agreement, as from time to time revised, changed, amended or modified, and related improvements and any substitutions therefor.
“Favorable Opinion of Bond Counsel” shall mean, with respect to any action relating to the Bonds, the occurrence of which requires such an opinion, a written legal opinion of Bond Counsel addressed to the Issuer, the Bank, the Trustee, the Borrower or the Remarketing Agent, as applicable, to the effect that the action proposed to be taken (i) is authorized or permitted by the laws of the State of Arizona and federal law and this Indenture, and all conditions precedent, if any, have been satisfied, and (ii) will not adversely affect any exclusion from gross income for federal income tax purposes of interest on the Bonds.
“Government Obligations” shall mean direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed as to full and timely payment by, the United States of America and which are not subject to prepayment or redemption prior to maturity.
“Indenture” shall mean this Indenture of Trust, as originally executed or as it may from time to time be supplemented, modified or amended by any supplemental indenture entered into pursuant to the provisions hereof.
“Initial Long-Term Interest Rate” shall mean the Interest Rate for the Bonds on the date of issuance and delivery of the Bonds as specified in Section 2.01(b) hereof.
“Initial Long-Term Interest Rate Period” shall mean the period commencing August 28, 2012 and ending on August 1, 2042.
“Interest Accrual Date” shall mean (i) with respect to any Daily Interest Rate Period, the first day thereof and, thereafter, the first day of each calendar month during that Daily Interest Rate Period, (ii) with respect to any Weekly Interest Rate Period, the first day thereof and, thereafter, the first day of each calendar month during that Weekly Interest Rate Period, (iii) with 

6

respect to any Long-Term Interest Rate Period, the first day thereof and, thereafter, each Interest Payment Date in respect thereof, other than the last such Interest Payment Date, and (iv) with respect to each Bond Interest Term within a Short-Term Interest Rate Period, the first day thereof.
“Interest Payment Date” shall mean (i) with respect to any Daily Interest Rate Period or Weekly Interest Rate Period, the first Business Day of each calendar month, (ii) with respect to any Long-Term Interest Rate Period, each February 1 and August 1, commencing February 1, 2013 and occurring during such Long-Term Interest Rate Period and the Business Day next succeeding the last day thereof, (iii) with respect to any Short-Term Interest Rate Period, the Business Day next succeeding the last day of thereof, and (iv) in all events, the redemption date or the Maturity Date.
“Interest Rate Period” shall mean any Daily Interest Rate Period, Weekly Interest Rate Period, Short-Term Interest Rate Period or Long- Term Interest Rate Period.
“Investment Securities” shall mean any of the following obligations or securities (only to the extent investment therein would not violate the laws of the State of Arizona) on which the Borrower (or any affiliate) is not the obligor, maturing at such time or times as to enable disbursements to be made from the Bond Fund in accordance with the terms hereof, or which shall be marketable prior to the maturities thereof:
(i)direct obligations of, or obligations the principal and interest of which are guaranteed as to the full and timely payment by, the United States of America, which obligations, in either case, are not subject to redemption or prepayment at less than par by anyone other than the holder;
(ii)obligations issued or guaranteed by an instrumentality of the United States of America pursuant to authority granted by the Congress of the United States of America, including obligations of the Federal National Mortgage Association, Federal Intermediate Credit Banks, Banks for Cooperatives, Federal Land Banks or Federal Home Loan Banks;
(iii)commercial paper rated at the time of investment in the highest short-term grade by the Rating Agencies;
(iv)bankers' acceptances drawn on and accepted by commercial banks (including the Trustee, the Paying Agent, and the Bank) having at least $10,000,000 in capital stock, surplus and undivided profits the unsecured, uninsured obligations of which are rated not less than “Prime - 1” or “Aa2” by Moody's and “A-1” or “A+” by S&P;
(v)certificates of deposit, deposit accounts and savings accounts fully insured by the Federal Deposit Insurance Corporation or collateralized by Investment Securities described in (1) above;
(vi)repurchase agreements with solvent banking or other financial institutions (including the Trustee, the Paying Agent, and the Bank) rated at the time of 

7

investment not less than the then current rating of the Bonds by each of the Rating Agencies;
(vii)obligations of a state, a territory, Puerto Rico, or a possession of the United States of America, or any political subdivision of the foregoing, or of the District of Columbia and which are rated at the time of investment not less than the then current rating of the Bonds by each of the Rating Agencies;
(viii)money market funds registered under the federal Investment Company Act of 1940, whose shares are registered under the federal Securities Act of 1933, and having a rating by S&P of “AAAm-G”, “AAAm” or “Aam”, and by Moody's of “Aaa” or “Aa”, including funds for which the Trustee (or any affiliate of the Trustee) provides investment advice or other services;
(ix)custodial agreements providing for the investment of moneys through a custodian, reverse purchase agreements, option agreements and agreements to lend securities; and
(x)any other obligations and securities not prohibited by law and which are rated at least “Aaa” or “Aa” by Moody's and “AAA” or “AA” by S&P.
“Issue Date” shall mean August 28, 2012, the date of issuance and delivery of the Bonds to the Underwriters against payment therefor.
“Issuer” shall mean Maricopa County, Arizona Pollution Control Corporation, an Arizona nonprofit corporation designated as a political subdivision existing under the laws of the State of Arizona, incorporated for and with the approval of the County, pursuant to the provisions of the Constitution of the State of Arizona and the Act, and its successors and assigns.
“Letter of Credit” shall mean the irrevocable direct pay letter of credit, if any, issued by the Bank and delivered to the Trustee in accordance with Section 6.08 of the Agreement and any extension thereof.
“Long-Term Interest Rate” shall mean with respect to each Bond, a fixed, non-variable interest rate on such Bond established in accordance with Section 2.01(c)(iv) hereof.
“Long-Term Interest Rate Period” shall mean each period during which a Long-Term Interest Rate is in effect.
“Maturity Date” shall mean August 1, 2042.
“Maximum Bond Interest Rate” shall mean the lesser of 12% per annum and the Maximum Lawful Rate, calculated in the same manner as interest is calculated for the particular interest rate on the Bonds.
“Maximum Lawful Rate” shall mean the maximum rate of interest on the relevant obligation permitted by applicable law.

8

“Moody's” shall mean Moody's Investors Service, Inc., a corporation organized and existing under the laws of the State of Delaware, its successors and their assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “Moody's” shall be deemed to refer to any other nationally recognized securities rating agency designated by the Borrower, with the approval of the Remarketing Agent and the Bank, by notice to the Trustee, the Tender Agent and the Issuer.
“Nominee” shall have the meaning specified in Section 2.01(e) hereof.
“Official Statement” shall mean the Official Statement relating to the Bonds, including all appendices thereto.
“Outstanding” when used in reference to the Bonds, shall mean, as at any particular date, the aggregate of all Bonds authenticated and delivered in accordance with this Indenture except:
(xi)those cancelled at or prior to such date or delivered to or held by the Trustee at or prior to such date for cancellation;
(xii)those deemed to be paid in accordance with Article IX hereof;
(xiii)those in lieu of or in exchange, replacement or substitution for which other Bonds shall have been authenticated and delivered in accordance with this Indenture, unless proof satisfactory to the Trustee and the Borrower is presented that such Bond is held by a bona fide holder in due course; and
(xiv)Bonds deemed purchased pursuant to Section 4.10 hereof.

“Owner” shall mean the person or entity in whose name any Bond is registered upon the registration books maintained pursuant to Section 2.04 hereof.
“Participant” shall mean, with respect to DTC or another Securities Depository, a member of or participant in DTC or such other Securities Depository, respectively.
“Paying Agent” shall mean the initial and any successor paying agent or agents appointed in or in accordance with Section 11.21 hereof.  “Principal Office” of the Paying Agent shall mean the Principal Office of the Trustee (if the Trustee is the Paying Agent) or such other office of the Paying Agent designated in writing to the Issuer, the Trustee, the Bank, the Tender Agent and the Remarketing Agent, as applicable.
“Payment Date” shall mean each Interest Payment Date or any other date on which any principal of, premium, if any, or interest on any Bond is due and payable for any reason, including without limitation upon any redemption of Bonds pursuant to Section 4.01.
“Person” shall mean a corporation, association, partnership, limited liability company, joint venture, trust, organization, business, individual or government or any governmental agency or political subdivision thereof.

9

“Plant” shall mean Units 1, 2 and 3 of the Palo Verde Nuclear Generating Station, a nuclear power generating plant located in Maricopa County, Arizona, at which the Project is located.
“Prior Bonds” shall have the meaning set forth in the 5th Whereas clause of this Indenture.
“Purchase Fund” shall mean the fund created by Section 6.01 hereof.
“Rating Agencies” shall mean S&P and Moody's.
“Receipts and Revenues” shall mean (a) the Repayment Installments including all moneys drawn by the Trustee under a Credit Facility in satisfaction of the Borrower's obligations to make Repayment Installments (b) all other moneys received by the Trustee (for the account of the Issuer) pursuant to the Agreement, (c) all moneys and investments in the Bond Fund and (d) all income and profit from the investment of the foregoing moneys.  The term “Receipts and Revenues” does not include any moneys or investments in the Purchase Fund or amounts required to be paid to the Issuer pursuant to Sections 5.04, 5.07, 8.03 and 8.05 of the Agreement.
“Record Date” shall mean (a) with respect to any Interest Payment Date in respect of any Daily Interest Rate Period, the last Business Day of each calendar month or, in the case of the last Interest Payment Date in respect of a Daily Interest Rate Period, the Business Day immediately preceding such Interest Payment Date, (b) with respect to any Interest Payment Date in respect of any Weekly Interest Rate Period or any Bond Interest Term within a Short-Term Interest Rate Period, the Business Day immediately preceding such Interest Payment Date, and (c) with respect to any Interest Payment Date in respect of any Long-Term Interest Rate Period, the fifteenth day of the month immediately preceding such Interest Payment Date or, in the event that an Interest Payment Date shall occur within 16 days after the first day of a Long-Term Interest Rate Period, such first day.
“Registrar” shall mean the registrar or registrars appointed in or in accordance with Section 11.23 hereof.  “Principal Office” of the Registrar shall mean the Principal Office of the Trustee (if the Trustee is the Registrar) or such other office of the Registrar designated in writing to the Issuer, the Trustee, the Tender Agent and the Remarketing Agent.
“Reimbursement Agreement” shall mean the Reimbursement Agreement, between the Borrower and the Bank issued in connection with the Letter of Credit and delivered to the Trustee in connection with Section 6.08 of the Agreement and any extension thereof.
“Remarketing Agent” shall mean any remarketing agent appointed in accordance with Section 14.01 hereof.
“Remarketing Agreement” shall mean a Remarketing Agreement, that may be executed and delivered, between the Borrower and the Remarketing Agent, relating to the Bonds, as supplemented or amended in accordance with the provisions thereof.

10

“Repayment Installment” shall mean any amount that the Borrower is required to pay to the Trustee pursuant to Section 5.02(a) of the Agreement as a repayment of the loan made by the Issuer under the Agreement.
“Representation Letter” shall have the meaning set forth in Section 2.01(e)(ii) hereof.
“S&P” shall mean Standard & Poor's Ratings Group, a division of McGraw-Hill Inc., a corporation organized and existing under the laws of the State of New York, its successors and their assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “S&P” shall be deemed to refer to any other nationally recognized securities rating agency designated by the Borrower, with the approval of the Remarketing Agent and the Bank, by notice to the Trustee, the Tender Agent and the Issuer.
“Securities Act” shall mean the Securities Act of 1933, as amended, and any successor thereto.
“Securities Depository” shall mean DTC or, if applicable, any successor securities depository appointed pursuant to this Indenture.
“Securities Exchange Act” shall mean the Securities and Exchange Act of 1934, as amended, and any successor thereto.
“Short-Term Interest Rate Period” shall mean, with respect to each Bond bearing interest at a BIT Rate, the period established in accordance with Section 2.01(c)(v) hereof.
“SIFMA” means Securities Industry and Financial Markets Association or any person acting in cooperation with or under the sponsorship of SIFMA and acceptable to the Remarketing Agent and effective from such date.
“SIFMA Index” shall mean on any date, a rate determined on the basis of the seven-day high grade market index of tax-exempt variable rate demand obligations, as produced by Municipal Market Data (“MMD”) and published or made available by SIFMA.
“Special Record Date” means the date established by the Trustee in connection with the payment of overdue interest on that Bond pursuant to Section 2.01(b) hereof.
“State” shall mean the State of Arizona.
“Supplemental Indenture” shall mean any supplemental indenture hereafter duly authorized and entered into between the Issuer and the Trustee in accordance with the provisions of this Indenture.
“Tax Certificate” shall mean the Tax Compliance Certificate dated August 28, 2012, executed by the Issuer in connection with the issuance of the Bonds.
“Tax-Exempt” shall mean, with respect to interest on any obligations of a state or local government, including the Bonds, that such interest is excluded from the gross income of the holders thereof (other than any holder who is a “substantial user” of facilities financed with such 

11

obligations or a “related person” within the meaning of Section 147(a) of the Code) for federal income tax purposes, whether or not such interest is includable as an item of tax preference or otherwise includable directly or indirectly for purposes of calculating other tax liabilities, including any alternative minimum tax under the Code.
“Tender Agent” shall initially mean the Trustee, and any such other party as shall be designated by the Issuer as a Tender Agent and appointed in accordance with Section 14.01 hereof.  “Principal Office” of the Tender Agent shall initially mean the Principal Office of the Trustee, or such other office thereof designated in writing to the Issuer, the Trustee and the Remarketing Agent.
“Tender Agreement” shall mean the Tender Agreement, if any, that may be executed and delivered, between the Borrower and the Tender Agent, relating to the Bonds, as supplemented or amended in accordance with the provisions thereof.
“Trustee” shall mean Union Bank, N.A., as trustee under this Indenture, and its successor or successors hereunder.  “Principal Office” of the Trustee shall mean a principal office of the Trustee at which at any particular time its corporate trust business shall be administered in California, which office at the date of the execution of this Indenture, is 120 South San Pedro Street, 4th Floor, Los Angeles, California 90012, Corporate Trust Department; except that with respect to the presentation of Bonds for payment or for registration of transfer, exchange or tender, such term shall mean the office or agency of the Trustee at Union Bank, N.A., Corporate Trust Department, 120 South San Pedro Street, 4th Floor, Los Angeles, California 90012, Attention: Bond Redemption.
“Trust Estate” shall mean at any particular time all right, title and interest of the Issuer in and to the Agreement (except its rights under Sections 5.04, 5.07 and 8.05 thereof and any rights of the Issuer to receive notices, certificates, requests, requisitions, directions and other communications thereunder), including without limitation the Receipts and Revenues, all moneys and obligations which at such time are deposited or are required to be deposited with, or are held or are required to be held by or on behalf of, the Trustee or any Paying Agent in trust under any of the provisions of this Indenture and all other rights, titles and interests which at such time are subject to the lien of this Indenture, except for moneys or obligations deposited with or paid to the Trustee or any Paying Agent for the redemption or payment of Bonds which are deemed to have been paid in accordance with Article IX hereof and funds held pursuant to Section 5.06 hereof.
“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended, and any successor thereto.
“Underwriters” means U.S. Bancorp Investments, Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
“Weekly Interest Rate” shall mean a variable interest rate on the Bonds established in accordance with Section 2.01(c)(iii) hereof.
“Weekly Interest Rate Period” shall mean each period during which a Weekly Interest Rate is in effect.

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Section 1.02Number and Gender.  The singular form of any word used herein, including the terms defined in Section 1.01, shall include the plural, and vice versa.  The use herein of a word of any gender shall include all genders.
Section 1.03Articles, Sections, Etc. All references herein to “Articles,” “Sections” and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Indenture as originally executed; and the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or subdivision hereof.  The headings or titles of the several Articles and Sections hereof, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not affect the meaning, construction or effect of this Indenture.
Section 1.04Content of Certificates and Opinions.  Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture or the Agreement (except for the certificate of cancelled Bonds provided for in Sections 2.05, 2.06 and 4.05 hereof) shall include (a) a statement that the person or persons making or giving such certificate or opinion have read such covenant or condition and the definitions herein relating thereto; (b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (c) a statement that, in the opinion of the signers, they have made or caused to be made such examination or investigation as is necessary to enable them to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether, in the opinion of the signers, such condition or covenant has been complied with.
Any such certificate or opinion made or given by an officer of the Issuer or the Borrower may be based, insofar as it relates to legal matters, upon a certificate or opinion of or representations by counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his or her certificate or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should have known that the same were erroneous.  Any such certificate or opinion made or given by counsel may be based, insofar as it relates to factual matters (with respect to which information is in the possession of the Issuer or the Borrower), upon the certificate or opinion of or representations by an officer of the Issuer or the Borrower, as applicable, unless such counsel knows that the certificate or opinion or representations with respect to the matters upon which his or her opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should have known that the same were erroneous.
Section 1.05Findings.  It is hereby found and determined by the Issuer that:
(a)The Borrower is a corporation which is conducting operations in the County and is qualified under the Act to borrow the proceeds of the sale of the Bonds from the Issuer to redeem and repay the outstanding principal amount of the Prior Bonds for purposes of the Act;
(b)The Project promotes the purposes of the Act by preventing or limiting air, water and other forms of pollution for the purpose of protecting the health and welfare of the citizens of the State of Arizona, and facilitates compliance by the Borrower with existing and 

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possible future air, water and other quality standards designed to improve the environment in the State of Arizona;
(c)The loan pursuant to the Agreement is in furtherance of the purposes of the Issuer;
(d)It is advisable that the Bonds be subject to redemption as provided in this Indenture;
(e)The manner in which the Bonds are sold is most advantageous and it is necessary and advantageous that the expenses, premiums and commissions, if any, in connection with the issuance of the Bonds be paid by the Borrower; and
(f)It is advisable that this Indenture contain the provisions set forth herein.

ARTICLE II
THE BONDS
Section 2.01Authorization and Terms of Bonds.
(a)Authorization.  Bonds designated as “Maricopa County, Arizona Pollution Control Corporation Pollution Control Refunding Revenue Bonds, 2012 Series A (El Paso Electric Company Palo Verde Project)” may be issued under this Indenture.  The aggregate principal amount of Bonds which may be issued and Outstanding under this Indenture shall not exceed Fifty-nine Million Two Hundred Thirty-five Thousand Dollars ($59,235,000).  No Bonds may be issued hereunder except in accordance with this Article.
(b)General Terms.  The Bonds shall be issued as fully registered Bonds, without coupons, in Authorized Denominations and shall be dated as of the Issue Date.  The Bonds shall mature, subject to prior redemption as provided in Article IV, upon the terms and conditions hereinafter set forth, on the Maturity Date.  The Bonds shall initially bear interest at the Long Term Interest Rate during the Initial Long-Term Interest Rate Period.  The Initial Long-Term Interest Rate shall be 4.50% per annum.
The Bonds shall be numbered from R-1 consecutively upwards in order of authentication.  Each Bond shall bear interest from the last date to which interest has been paid in full or, if no interest has been paid in full or duly provided on such Bond, from the Issue Date.  All Bonds shall mature on the Maturity Date and shall bear interest at the rates determined from time to time in accordance with the provisions of this Indenture.  Payment of the interest on any Bond shall be made to the person appearing on the bond registration books of the Registrar as the registered holder thereof as of the close of business on the Record Date, such interest to be paid by the Paying Agent to such registered holder (i) in the event such Bond is a Book-Entry Bond, in immediately available funds on the Interest Payment Date in accordance with the Representation Letter, and (ii) in the event such Bond is not a Book-Entry Bond (A) in immediately available funds (by wire transfer or by deposit to the account of the holder of at least $1,000,000 of Bonds if such account is maintained with the Paying Agent), according to the written instructions given by such holder to the Registrar prior to the Record Date, or (B) in all 

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other cases, by check mailed by first class mail to the holder at such holder's address as it appears as of the Record Date on the registration books of the Registrar; except, in each case, that, if and to the extent that there shall be a default in the payment of the interest due on such Interest Payment Date, such defaulted interest shall be paid to the holders in whose name any such Bonds are registered as of a Special Record Date to be fixed by the Trustee, notice of which shall be given to such holders not less than ten (10) days prior thereto.  Both the principal of and premium, if any, on the Bonds shall be payable upon surrender thereof in lawful money of the United States of America at the Principal Office of the Paying Agent.  Notwithstanding the foregoing, interest on any Bond bearing a Bond Interest Term Rate (except any such Bond which is a Book-Entry Bond) shall be paid only upon presentation to the Tender Agent of the Bond on which such payment is due.  The Bonds shall be dated as of the Issue Date.  The Bonds shall be substantially in the form attached hereto as Exhibit A.
If and to the extent, however, that the Issuer fails to make payment or provision for payment of interest on any Bond on any Interest Payment Date, that interest shall cease to be payable to the Owner of that Bond on the applicable Record Date.  When moneys become available for payment of the interest, (a) the Trustee shall, pursuant to Section 10.10 hereof, establish a Special Record Date for the payment of that interest which shall be not more than 15 nor fewer than 10 days prior to the date of the proposed payment, and (b) the Trustee shall give notice by first-class mail of the proposed payment and of the Special Record Date to each owner not fewer than 10 days prior to the Special Record Date and, thereafter, the interest shall be payable to the owners of the Bonds as of the Special Record Date at the close of business on the Special Record Date.
(c)Interest Rates and Rate Periods.  The Bonds shall bear interest until final payment of the principal or redemption price thereof shall have been made in accordance with the provisions hereof, whether at the Maturity Date, upon redemption or otherwise: During Daily Interest Rate Periods, interest on the Bonds shall be computed on the basis of a 365- or 366-day year for the number of days actually elapsed during Daily Interest Rate Periods.  During Short-Term Interest Rate Periods or Weekly Interest Rate Periods, interest on the Bonds shall be computed on the basis of a 365- or 366-day year for the number of days actually elapsed based on the calendar year in which the Short-Term Interest Rate Period or Weekly Interest Rate Period commences.  During any Long-Term Interest Rate Period, interest on the Bonds shall be computed upon the basis of a 360-day year, consisting of twelve 30-day months.
(i)Rate Periods.  The Bonds shall initially bear interest as set forth in Section 2.01(b), and shall remain in such Interest Rate Period until adjusted to a different Interest Rate Period as provided herein.  After any such adjustment, the term of the Bonds shall be divided into consecutive Interest Rate Periods during which the Bonds may bear interest at the Daily Interest Rate, Weekly Interest Rate, Bond Interest Term Rate or Long-Term Interest Rate.  Any Daily Interest Rate Period, Weekly Interest Rate Period or Short-Term Interest Rate Period established with respect to the Bonds shall continue in effect unless and until adjusted to a different Interest Rate Period as provided herein.  Notwithstanding any other provision herein, the Bonds are not subject to an adjustment to a different Interest Rate Period from the Initial Long-Term Interest Rate Period until after such Bonds have been purchased in lieu of redemption pursuant to Section 4.12 hereof.

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(ii)Daily Interest Rate.
(A)Determination of Daily Interest Rate.  During each Daily Interest Rate Period, the Bonds shall bear interest at the Daily Interest Rate, determined by the Remarketing Agent on or before each Business Day for such Business Day.  The Daily Interest Rate shall be the rate of interest per annum determined by the Remarketing Agent to be the lowest interest rate which would enable the Remarketing Agent to sell the Bonds for delivery on the effective date of such interest rate at a price (without regard to accrued interest) equal to 100% of the principal amount thereof.  The Remarketing Agent shall provide the Trustee and the Borrower with telephonic or Electronic notice of the Daily Interest Rate determined by 10:30 a.m. (New York City time) on the date of determination.  If the Remarketing Agent shall not have determined a Daily Interest Rate for any day by 10:30 a.m. (New York City time) on such day, the Daily Interest Rate shall be the same as the Daily Interest Rate for the immediately preceding day.  In no event shall the Daily Interest Rate be greater than the Maximum Bond Interest Rate.
(B)Adjustment to a Daily Interest Rate Period.  At any time, the Borrower, by written notice to the Issuer, the Trustee, the Bank, the Tender Agent and the Remarketing Agent may elect that the Bonds shall bear interest at a Daily Interest Rate.  Such notice (1) shall specify the effective date of such adjustment to a Daily Interest Rate, which shall be (a) a Business Day not earlier than thirty-five (35) days after delivery of such notice (or such shorter period as shall be acceptable to the Trustee); (b) in the case of an adjustment from a Long-Term Interest Rate Period, a day on which the Bonds would be permitted to be redeemed at the option of the Borrower pursuant to Section 4.01(a)(ii)(C) hereof; and (c) in the case of an adjustment from a Weekly Interest Rate Period or a Short-Term Interest Rate Period, an Interest Payment Date on which interest is payable for the Weekly Interest Rate Period or Bond Interest Term from which the adjustment is to be made; provided, however, that if prior to the Borrower's making such election, any Bonds shall have been called for redemption and such redemption shall not have theretofore been effected, the effective date of such Daily Interest Rate Period shall not precede such redemption date; and (2) if the adjustment is from a Long-Term Interest Rate Period, shall be accompanied by a Favorable Opinion of Bond Counsel addressed to the Trustee to the effect that such adjustment (a) is authorized or permitted by the Indenture and the Act, and (b) will not adversely affect the Tax-Exempt status of the interest on the Bonds.
(C)Notice of Adjustment to a Daily Interest Rate Period.  The Trustee shall give notice by first class mail of an adjustment to a Daily Interest Rate Period to the Owners of the Bonds not less than 15 days (30 days if the then current Interest Rate Period is a Long-Term Interest Rate Period) prior to the effective date of such Daily Interest Rate Period.  Such notice shall state (1) that the interest rate on the Bonds will be adjusted to a Daily Interest Rate (subject to the Borrower's ability to rescind its election as described in Section 2.01(c)(viii) hereof), (2) the effective date of the Daily Interest Rate Period, (3) that the Bonds

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are subject to mandatory tender for purchase on such effective date (except in the case of adjustment between Daily Interest Rate Periods and Weekly Interest Rate Periods), (4) the procedures for such mandatory tender, and (5) the purchase price of the Bonds on such effective date (expressed as a percentage of the principal amount thereof).
(iii)Weekly Interest Rate.
(A)Determination of Weekly Interest Rate.  During each Weekly Interest Rate Period, the Bonds shall bear interest at the Weekly Interest Rate, which shall be determined by the Remarketing Agent no later than the first day of such Weekly Interest Rate Period and thereafter no later than 10:00 a.m. (New York City time) on Wednesday of each week during such Weekly Interest Rate Period, unless any such Wednesday shall not be a Business Day, in which event the Weekly Interest Rate shall be determined by the Remarketing Agent no later than the Business Day immediately preceding such Wednesday.  The Weekly Interest Rate shall be the rate of interest per annum determined by the Remarketing Agent to be the lowest interest rate which would enable the Remarketing Agent to sell the Bonds for delivery on the effective date of such interest rate at a price (without regard to accrued interest) equal to 100% of the principal amount thereof.  If for any reason, a Weekly Interest Rate is not so established for any period by the time specified above by the Remarketing Agent, the Weekly Interest Rate shall be the same as the Weekly Interest Rate in effect for the immediately preceding week.  In no event shall any Weekly Interest Rate exceed the Maximum Bond Interest Rate.  The first Weekly Interest Rate determined for each Weekly Interest Rate Period shall apply to the period commencing on the first day of such Weekly Interest Rate Period and ending on the next succeeding Tuesday.  Thereafter, each Weekly Interest Rate shall apply to the period commencing on each Wednesday and ending on the next succeeding Tuesday, unless such Weekly Interest Rate Period shall end on a day other than Tuesday, in which event the last Weekly Interest Rate for such Weekly Interest Rate Period shall apply to the period commencing on the Wednesday preceding the last day of such Weekly Interest Rate Period and ending on such last day.  The Remarketing Agent shall provide the Trustee and the Borrower with written, telephonic or Electronic notice of each Weekly Interest Rate, as determined, by 12:00 noon (New York City time) on the effective date of such Weekly Interest Rate.
(B)Adjustment to Weekly Interest Rate.  At any time, the Borrower, by written direction to the Issuer, the Trustee, the Bank, the Tender Agent and the Remarketing Agent may elect that the Bonds shall bear interest at a Weekly Interest Rate.  Such direction (1) shall specify the effective date of such adjustment to a Weekly Interest Rate, which shall be (a) a Business Day not earlier than thirty-five (35) days after delivery of such notice (or such shorter period as shall be acceptable to the Trustee); (b) in the case of an adjustment from a Long-Term Interest Rate Period, a day on which the Bonds would otherwise be permitted to be redeemed at the option of the Borrower pursuant to Section 

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4.01(a)(ii)(C) hereof; and (c) in the case of an adjustment from a Daily Interest Rate Period or Short-Term Interest Rate Period, an Interest Payment Date on which interest is payable for the Daily Interest Rate Period or Bond Interest Term from which the adjustment is to be made; provided, however, that if prior to the Borrower's making such election, any Bonds shall have been called for redemption and such redemption shall not have theretofore been effected, the effective date of such Weekly Interest Rate Period shall not precede such redemption date; and (2) if the adjustment is from a Long-Term Interest Rate Period, shall be accompanied by a Favorable Opinion of Bond Counsel addressed to the Trustee to the effect that such adjustment (a) is authorized or permitted by the Indenture and the Act, and (b) will not adversely affect the Tax-Exempt status of interest on the Bonds.
(C)Notice of Adjustment to a Weekly Interest Rate Period.  The Trustee shall give notice by first class mail of an adjustment to a Weekly Interest Rate Period to the Owners of the Bonds not less than fifteen (15) days (thirty (30) days if the then current Interest Rate Period is a Long-Term Interest Rate Period) prior to the effective date of such Weekly Interest Rate Period.  Such notice shall state (1) that the Interest Rate on the Bonds will be adjusted to a Weekly Interest Rate (subject to the Borrower's ability to rescind its election as provided in Section 2.01(c)(viii) hereof), (2) the effective date of the Weekly Interest Rate Period, (3) that the Bonds are subject to mandatory tender for purchase on such effective date (except in the case of adjustments between Daily Interest Rate Periods and Weekly Interest Rate Periods), (4) the procedures for such mandatory tender, and (5) the purchase price of such Bonds on such effective date (expressed as a percentage of the principal amount thereof).
(iv)Long-Term Interest Rate.
(A)Determination of Long-Term Interest Rate.  During each Long-Term Interest Rate Period, the Bonds shall bear interest at the Long-Term Interest Rate, which shall be determined by the Remarketing Agent on a Business Day selected by the Remarketing Agent, but not more than forty (40) days prior to and not later than the effective date of such Long-Term Interest Rate Period.  The Long-Term Interest Rate shall be the rate of interest per annum determined by the Remarketing Agent on such date, and communicated by the close of business on such date to the Trustee, the Paying Agent and the Borrower, by written, telephonic or Electronic notice, as being the lowest interest rate which would enable the Remarketing Agent to sell the Bonds for delivery on the effective date of such Long-Term Interest Rate Period at a price (without regard to accrued interest) equal to 100% of the principal amount thereof, provided, however, that if, for any reason, a Long-Term Interest Rate for any Long-Term Interest Rate Period shall not be determined or effective or if an adjustment from a Long-Term Interest Rate Period to another Interest Rate Period shall not be effective, the Interest Rate Period for the Bonds shall automatically convert to a Daily Interest Rate Period; provided, further, however, that in the event the Borrower elected to have the right to terminate the mandatory tender for purchase required by Section 

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4.08(b)(i)(A) hereof pursuant to the fourth paragraph of this Section 2.01(c)(iv)(B), the Borrower may exercise such right in accordance with the fourth paragraph of this Section 2.01(c)(iv)(B); provided, further, however, that if the Favorable Opinion of Bond Counsel required by Section 2.01(c)(ii)(B) in connection with an adjustment to a Daily Interest Rate Period from a Long-Term Interest Rate Period cannot be obtained, then the Interest Rate Period for the Bonds shall automatically convert to a Long-Term Interest Rate Period of one year and one day.  If a Daily Interest Rate for the first day of such Daily Interest Rate Period is not determined as provided in Section 2.01(c)(ii) hereof, the Daily Interest Rate for the first day of such Daily Interest Rate Period shall be equal to the SIFMA Index.  In no event shall any Long-Term Interest Rate be greater than the Maximum Bond Interest Rate.  
(B)Adjustment to or Continuation of a Long-Term Interest Rate Period.  At any time, the Borrower, by written notice to the Issuer, the Bank, the Trustee, the Tender Agent and the Remarketing Agent may elect that the Bonds shall bear, or continue to bear, interest at a Long-Term Interest Rate, and if it shall so elect, shall determine the duration of the Long-Term Interest Rate Period during which the Bonds shall bear interest at such Long-Term Interest Rate.  Each Long-Term Interest Rate Period shall have a duration such that the last day of such Long-Term Interest Rate Period is (1) a day which both immediately precedes a Business Day and is at least one year after the effective date of such Long-Term Interest Rate Period, or (2) if earlier, the day immediately preceding the Maturity Date.  At the time the Borrower so elects an adjustment to or continuation of a Long-Term Interest Rate Period, the Borrower may specify two or more consecutive Long-Term Interest Rate Periods and, if the Borrower so specifies, shall specify the duration of each such Long-Term Interest Rate Period as provided in this paragraph.  Such notice shall specify the effective date of each Long-Term Interest Rate Period, which shall be (a) a Business Day not earlier than thirty-five (35) days after delivery of such notice (or such shorter period as shall be acceptable to the Trustee); (b) in the case of an adjustment from or continuation of a Long-Term Interest Rate Period, a day on which the Bonds would be permitted to be redeemed by the Borrower pursuant to Section 4.01(a)(ii)(C) hereof, and (c) in the case of an adjustment from a Daily, Weekly or Short-Term Interest Rate Period, an Interest Payment Date on which interest is payable for the Daily or Weekly Interest Rate Period or Bond Interest Term from which the adjustment is to be made; provided, however, that if prior to the Borrower's making such election, any Bonds shall have been called for redemption and such redemption shall not have theretofore been effected, the effective date of such Long-Term Interest Rate Period shall not precede such redemption date.  In addition, such notice (i) shall specify the last day of such Long-Term Interest Rate Period, and (ii) if the adjustment is from a Daily, Weekly or Short-Term Interest Rate Period, shall be accompanied by a Favorable Opinion of Bond Counsel addressed to the Trustee to the effect that such adjustment (a) is authorized or permitted by the Indenture and the Act, and (b) will not adversely affect the Tax-Exempt status of interest on the Bonds.

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If, by the thirty-fifth day prior to the last day of any Long-Term Interest Rate Period, the Trustee shall not have received notice of the Borrower's election that, during the next succeeding Interest Rate Period, the Bonds shall bear interest at a Daily Interest Rate, a Weekly Interest Rate, a Long-Term Interest Rate or a Bond Interest Term Rate accompanied by appropriate opinions of Bond Counsel, if required by Section 2.01(c)(ii)(B), (iii)(B), (iv)(B) or (v)(B) hereof, the next succeeding Interest Rate Period for the Bonds shall be a Daily Interest Rate Period; provided, however, that if the Favorable Opinion of Bond Counsel required by Section 2.01(c)(ii)(B) hereof in connection with an adjustment to a Daily Interest Rate Period from a Long-Term Interest Rate Period cannot be obtained, then the Interest Rate Period for the Bonds shall automatically convert to a Long-Term Interest Rate Period of one year and one day.  If a Daily Interest Rate for the first day of such Daily Interest Rate Period is not determined as provided in Section 2.01(c)(ii) hereof, the Daily Interest Rate for the first day of such Daily Interest Rate Period shall be equal to the SIFMA Index.

At the same time that the Borrower elects to have the Bonds bear interest at a Long-Term Interest Rate or continue to bear interest at a Long-Term Interest Rate, the Borrower may also specify to the Trustee optional redemption prices and periods different from (including that there be no such optional redemption) those set out in Section 4.01(a)(ii)(C) during the Long-Term Interest Rate Period(s) with respect to which such election is made; provided, however, that such notice shall be accompanied by a Favorable Opinion of Bond Counsel addressed to the Trustee to the effect that such changes (i) are authorized or permitted by the Act and this Indenture, and (ii) will not adversely affect the Tax-Exempt status of interest on the Bonds.

(A )    At the same time that the Borrower elects to have the Bonds bear interest at a Long-Term Interest Rate or continue to bear interest at a Long-Term Interest Rate, the Borrower may elect to have the right to terminate the mandatory tender for purchase required by Section 4.08(b)(i)(A) (“Mandatory Tender”) in accordance with this paragraph.  The Borrower may terminate the Mandatory Tender by providing, no later than 2 p.m. on the last day of the Long-Term Interest Rate Period, to the Trustee written notice rescinding the Mandatory Tender.  If the Borrower terminates the Mandatory Tender, the Borrower shall have no obligation to redeem or purchase the Bonds prior to maturity except as otherwise provided herein and the Bonds shall bear interest from the expiration of the Long-Term Interest Rate Period at a rate per annum, in no event greater than the Maximum Bond Interest Rate, as determined at the same time the Borrower elected to have the Bonds bear interest at a Long-Term Interest Rate or continue to bear interest at a Long-Term Interest Rate.  Following such rescission, at the option of the Borrower, the Bonds are subject to tender for purchase at 100% of the principal amount of the Bonds on any Business Day, if the Borrower provides written notice to the Trustee no later than noon on such Business Day.
(C)Notice of Adjustment to or Continuation of a Long-Term Interest Rate Period.  The Trustee shall give notice by first class mail of an 

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adjustment to or continuation of a Long-Term Interest Rate Period to the Owners of the Bonds not less than fifteen (15) days (thirty (30) days if the then current Interest Rate Period is a Long-Term Interest Rate Period) prior to the effective date of such Long-Term Interest Rate Period.  Such notice shall state (1) that the interest rate on the Bonds will be adjusted to, or continue to be, a Long-Term Interest Rate (subject to the Borrower's ability to rescind its election as provided in Section 2.01(c)(viii) hereof), (2) the effective date of such Long-Term Interest Rate Period, (3) that the Bonds shall be subject to mandatory tender for purchase on such effective date, (4) the procedures for such mandatory tender, and (5) the purchase price of the Bonds on such effective date (expressed as a percentage of the principal amount thereof).
(v)Bond Interest Term Rate.
(A)Determination of Bond Interest Terms and Bond Interest Term Rates.  During each Short-Term Interest Rate Period, each Bond shall bear interest during each Bond Interest Term for such Bond at the Bond Interest Term Rate for such Bond.  Each Bond Interest Term for any Bond shall be a period of at least one day but not more than the lesser of (x) 270 days or (y) the number of days of interest coverage on the Bonds provided for in any Credit Facility then in effect minus five (5) days.  When a Credit Facility, if any, other than any initial Letter of Credit is in effect with respect to the Bonds or no Credit Facility is in effect with respect to the Bonds, each Bond Interest Term for any Bond shall be a period of at least one day but not more than 270 days.  Each Bond Interest Term for any Bond shall be a period determined by the Remarketing Agent to be, in its judgment, the period which, taking into account prevailing market conditions and all other Bond Interest Terms and Bond Interest Term Rates for all Bonds then Outstanding, is likely to result in the lowest overall net interest expense on all such Bonds; provided, however, that any such Bond purchased on behalf of the Borrower and remaining unsold in the hands of the Remarketing Agent as of 1:00 p.m. (New York City time) on the effective date of the Bond Interest Term for such Bond shall have a Bond Interest Term of one day or, if such Bond Interest Term would not end on a day immediately preceding a Business Day, a Bond Interest Term of more than one day ending on the day immediately preceding the next Business Day; provided, further, however, that (1) each Bond Interest Term shall end on a day which immediately precedes a Business Day and no Bond Interest Term shall extend beyond the day immediately preceding the Maturity Date or, if a Credit Facility, if any, is then in effect with respect to the Bonds, the fifth day immediately preceding the scheduled expiration date of such Credit Facility, and (2) if for any reason the Remarketing Agent fails or is unable to determine a Bond Interest Term on any Bond, the Bond Interest Term for such Bond shall be one day, unless such Bond Interest Term would end on a day which does not precede a Business Day, in which case such Bond Interest Term shall end on the day immediately preceding the next succeeding Business Day.

The Bond Interest Term Rate for each Bond Interest Term for each Bond shall be the rate of interest per annum determined by the Remarketing Agent no 

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later than 1:00 p.m. (New York City time) on the first day of such Bond Interest Term to be the lowest interest rate which would enable the Remarketing Agent to sell such Bonds on the effective date of such interest rate at a price (without regard to accrued interest) equal to 100% of the principal amount thereof.  The Remarketing Agent shall provide the Trustee and the Borrower with telephonic or Electronic notice of each Bond Interest Term Rate and Bond Interest Term by 1:00 p.m. (New York City time) on the date of determination.  If a Bond Interest Term Rate for a Bond Interest Term of one day is not determined or effective by 1:00 p.m. (New York City time) on such day, the Bond Interest Term Rate for such Bond Interest Term of one day shall be equal to the SIFMA Index.  In no event shall any Bond Interest Term Rate exceed the Maximum Bond Interest Rate.

Notwithstanding the foregoing, in the event that notice of redemption with respect to any Bond in a Short-Term Interest Rate Period shall have been given to the holder of such Bond by the Trustee pursuant to Section 4.03 hereof, no subsequent Bond Interest Terms or Bond Interest Term Rates shall be determined with respect to such Bond.
(B)Adjustment to or Continuation of Bond Interest Term Rates.  At any time, the Borrower, by written direction to the Issuer, the Trustee, the Bank, if any, the Tender Agent and the Remarketing Agent may elect that the Bonds shall bear interest at Bond Interest Term Rates.  Such direction (1) shall specify the effective date of the Short-Term Interest Rate Period during which the Bonds shall bear interest at Bond Interest Term Rates, which shall be (a) a Business Day not earlier than thirty-five (35) days after delivery of such notice (or such shorter period as shall be acceptable to the Trustee), (b) in the case of an adjustment from a Long-Term Interest Rate Period, a day on which the Bonds would be permitted to be redeemed at the option of the Borrower pursuant to Section 4.01(a)(ii)(C) hereof, and (c) in the case of an adjustment from a Daily or Weekly Interest Rate Period, an Interest Payment Date on which interest is payable for the Daily or Weekly Interest Rate Period from which the adjustment is to be made; provided, however, that if prior to the Borrower's making such election any Bonds shall have been called for redemption and such redemption shall not have theretofore been effected, the effective date of such Short-Term Interest Rate Period shall not precede such redemption date; and (2) shall be accompanied by a Favorable Opinion of Bond Counsel addressed to the Trustee to the effect that such adjustment (a) is authorized or permitted by the Indenture and the Act and (b) will not adversely affect the Tax-Exempt status of interest on the Bonds.
(C)Notice of Adjustment to a Bond Interest Term.  The Trustee shall give notice by first class mail of an adjustment to a Short-Term Interest Rate Period to the Owners of the Bonds not less than fifteen (15) days (thirty (30) days if the then current Interest Rate Period is a Long-Term Interest Rate Period) prior to the effective date of such Short-Term Interest Rate Period.  Such notice shall state (1) that the interest rate on the Bonds will be adjusted to 

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Bond Interest Term Rates (subject to the Borrower's ability to rescind its election as provided in Section 2.01(c)(viii) hereof), (2) the effective date of the Short-Term Interest Rate Period, (3) that the Bonds are subject to mandatory tender for purchase on the effective date of such Short-Term Interest Rate Period, (4) the procedures for such mandatory tender, and (5) the purchase price of the Bonds on such effective date (expressed as a percentage of the principal amount thereof).
(D)Adjustment from a Short-Term Interest Rate Period.  At any time during a Short-Term Interest Rate Period, the Borrower may elect that the Bonds shall no longer bear interest at Bond Interest Term Rates and shall instead bear interest as otherwise permitted under this Indenture.  The Borrower shall give written notice to the Issuer, the Trustee, the Paying Agent and the Remarketing Agent, if any, of such election and shall specify the Interest Rate Period to follow with respect to such Bonds upon cessation of the Short-Term Interest Rate Period and instruct the Remarketing Agent to (1) determine Bond Interest Terms of such duration that, as soon as possible, all Bond Interest Terms shall end on the same date, not earlier than twenty-four (24) days (or such shorter period acceptable to the Trustee) following the delivery by the Borrower of such written notice, and upon the establishment of such Bond Interest Term the day next succeeding the last day of all such Bond Interest Terms shall be the effective date of the Interest Rate Period elected by the Borrower; or (2) determine Bond Interest Terms that will best promote an orderly transition to the next succeeding Interest Rate Period to apply to the Bonds, beginning not earlier than twenty-four (24) days (or such shorter period acceptable to the Trustee) following the delivery by the Borrower of such written notice.  If the alternative in clause (2) above is selected (and if the Trustee requests, a Favorable Opinion of Bond Counsel is received), the day next succeeding the last day of the Bond Interest Term for each Bond shall be with respect to such Bond the effective date of the Interest Rate Period elected by the Borrower.  The Remarketing Agent, promptly upon the determination thereof, shall give written notice of such last day and such effective dates to the Borrower, the Trustee and the Tender Agent.  During any transitional period from a Short-Term Interest Rate Period to the next succeeding Interest Rate Period in accordance with clause (2) above, the provisions of this Indenture shall be deemed to apply to the Bonds as follows: the Bonds continuing to bear interest at Bond Interest Term Rates shall have applicable to them the provisions hereunder theretofore applicable to such Bonds as if all Bonds were continuing to bear interest at Bond Interest Term Rates and the Bonds bearing interest in the Interest Rate Period to which the transition is being made will have applicable to them the provisions hereunder as if all Bonds were bearing interest in such Interest Rate Period.
(vi)Reserved.
(vii)Terms of Credit Facility, If Any.  If a Credit Facility in the form of a letter of credit is to be held by the Trustee after the effective date of any adjustment from one Interest Rate Period to another Interest Rate Period, such Credit Facility, if any, shall be in an amount sufficient to provide payment of (x) the principal amount of the 

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Outstanding Bonds plus (y) the amount of interest (computed on the basis of a 365-day year in the case of an adjustment to a Daily Interest Rate Period, Weekly Interest Rate Period or Short-Term Interest Rate Period, and on the basis of a 360-day year consisting of twelve 30-day months in the case of an adjustment to a Long-Term Interest Rate Period) which will accrue on the Outstanding Bonds for a period equal to the maximum number of days between Interest Payment Dates during the new Interest Rate Period plus five (5) days.  In the case of an adjustment to a Long-Term Interest Rate Period, a Credit Facility, if any, to be in effect after the effective date of such adjustment shall (i) extend for a period ending on a date no earlier than five (5) days after the first date on which the Bonds may be called for redemption pursuant to Section 4.01(a)(ii)(C), and (ii) cover the premium, if any, which would be included in the purchase price upon mandatory purchase of the Bonds pursuant to Section 4.08(b) hereof if the term of such Credit Facility was not extended beyond the expiration date set forth therein.
(viii)Determination Conclusive.  The determination of any Bond Interest Term Rate, Daily Interest Rate, Weekly Interest Rate and Long-Term Interest Rate and each Bond Interest Term and the calculation of interest payable on the Bonds by the Remarketing Agent shall be conclusive and binding upon such Remarketing Agent, the Trustee, the Tender Agent, the Issuer, the Borrower, the Bank and the Owners of the Bonds.
(ix)Rescission of Election.  Notwithstanding anything herein to the contrary, the Borrower may rescind any election by it to adjust to or continue an Interest Rate Period pursuant to Sections 2.01(c)(ii)(B), (iii)(B), (iv)(B) or (v)(B) hereof prior to the effective date of such adjustment or continuation by giving written notice thereof to the Issuer, the Trustee, the Tender Agent and the Remarketing Agent, if any, prior to such effective date.  If the Trustee receives notice of such rescission prior to the time the Trustee has given notice to the Owners of the Bonds pursuant to Section 2.01(c)(ii)(C), (iii)(C), (iv)(C), or (v)(C) as applicable, then the notice of adjustment or continuation previously delivered by the Borrower shall be of no force and effect.  If the Trustee receives notice from the Borrower of rescission of an adjustment to or continuation of an Interest Rate Period after the Trustee has given notice to the Owners of the Bonds pursuant to Section 2.01(c)(ii)(C), (iii)(C), (iv)(C), or (v)(C), as applicable, then the Interest Rate Period for the Bonds shall automatically adjust to a Daily Interest Rate Period on the date originally scheduled for such adjustment or continuation; provided, however, that in the event the Borrower elected to have the right to terminate the Mandatory Tender pursuant to the fourth paragraph of Section 2.01(c)(iv)(B), the Borrower may exercise such right in accordance with the fourth paragraph of Section 2.01(c)(iv)(B); provided, however, that if the Bonds are then in a Long-Term Interest Rate Period and the Favorable Opinion of Bond Counsel required by Section 2.01(c)(ii)(B) in connection with an adjustment to a Daily Interest Rate Period from a Long-Term Interest Rate Period cannot be obtained, then the Interest Rate Period for the Bonds shall automatically convert to a Long-Term Interest Rate Period of one year and one day.  If a Daily Interest Rate for the first day of such Daily Interest Rate Period is not determined as provided in Section 2.01(c)(ii) hereof, the Daily Interest Rate for the first day of such Daily Interest Rate Period shall be equal to the SIFMA Index.

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(d)Form of Bonds.  The Bonds may be engraved, printed, lithographed or typewritten, shall be in Authorized Denominations and may contain such references to any of the provisions of this Indenture as may be appropriate.  The form of the Bonds, the certificate of authentication to be executed on all the Bonds by the Trustee and the forms for registration of transfer shall be in substantially the forms thereof set forth in Exhibit A hereto, with necessary or appropriate variations, omissions and insertions as permitted or required by this Indenture.  The Bonds and the certificate of authentication to be executed thereon shall be in substantially the form attached hereto as Exhibit A, with such appropriate variations, omissions and insertions as are permitted or required by this Indenture.  Pursuant to recommendations promulgated by the Committee on Uniform Security Identification Procedures, “CUSIP” numbers may be printed on the Bonds.  The Bonds may bear such endorsement or legend relating thereto as may be required to conform to usage or law with respect thereto.  If appropriate, the Bonds may be printed with a portion of the text printed on the reverse side thereof and with a legend printed on the front referring to such text to the following effect: “Reference is hereby made to the further provisions of this Bond set forth on the back hereof and such further provisions are hereby incorporated by reference as if set forth here in full.” Upon adjustment to a Long-Term Interest Rate Period, the form of Bond may include a summary of the rescission of the Mandatory Tender pursuant to paragraph four of Section 2.01(c)(iv)(B), a summary of the mandatory and optional redemption provisions to apply to the Bonds during such Long-Term Interest Rate Period, or a statement to the effect that the Bonds will not be optionally redeemed during such Long-Term Interest Rate Period, provided that the Registrar shall not authenticate such a revised Bond form prior to receiving a Favorable Opinion of Bond Counsel that such Bond form conforms to the terms of the Act and of this Indenture and that authentication thereof will not adversely affect the Tax-Exempt status of the Bonds, and a summary .
(e)Book-Entry System.  Bonds shall be issued in the form of a single certificated fully registered Bond, registered in the name of Cede & Co., as nominee of the Depository Trust Company (such entity and its successors and assigns are referred to herein as “DTC”), or such other name as may be requested by an authorized representative of DTC, or any successor nominee (the “Nominee”).  Except as provided in paragraph (C) below, all of the Outstanding Bonds shall be so registered in the registration books kept by the Registrar, and the provisions of this Section 2.01(e) shall apply thereto.
(i)The Issuer, the Borrower, the Remarketing Agent, the Tender Agent, the Trustee, the Registrar, the Paying Agent and any Co-Registrar and Co-Paying Agent shall have no responsibility or obligation to any DTC participant or to any person on behalf of which a DTC participant holds an interest in the Bonds, except as otherwise expressly provided herein.  Without limiting the immediately preceding sentence, the Issuer, the Borrower, the Trustee, the Registrar, the Paying Agent, the Tender Agent, the Remarketing Agent and any Co-Registrar and Co-Paying Agent shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, the Nominee, any DTC participant or indirect participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC participant or any other person, other than an Owner as shown in the registration books kept by the Registrar, of any notice with respect to the Bonds, including any notice of redemption (except that the Trustee and Tender Agent, if any, shall have the obligation to deliver notices of optional and mandatory tender to the Remarketing Agent, if any, as provided herein) or (iii) the 

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payment to any DTC participant or any other person, other than an Owner, as shown in the registration books kept by the Registrar, of any amount with respect to principal or purchase price of, premium, if any, or interest on the Bonds.  The Paying Agent shall pay all principal, premium, if any, and interest on the Bonds only to or upon the order of the respective Owners, as shown in the registration books kept by the Registrar, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to payment of principal of, premium, if any, and interest on the Bonds to the extent of the sum or sums so paid.  The Issuer, the Borrower, the Trustee, the Registrar, the Paying Agent, the Tender Agent, the Remarketing Agent and any Co-Registrar and Co-Paying Agent may treat and consider the person in whose name each Bond is registered in the registration books kept by the Registrar as the holder and absolute owner of such Bond for the purpose of payment of principal, purchase price, premium and interest with respect to such Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever; provided, however, notwithstanding the foregoing provisions, the Tender Agent, if any, shall accept any notice of optional tender pursuant to Section 4.08(a) from any Owner of any Book-Entry Bond, but shall make payment of the purchase price thereof only to the registered owner of such Bond in the manner provided in the Representation Letter (as defined below); and provided further, that no person other than an Owner, as shown in the registration books kept by the Registrar, shall receive a certificated Bond evidencing the obligation of the Issuer to make payments of principal, premium, if any, and interest pursuant to this Indenture.
(ii)The Issuer, the Paying Agent, the Registrar, the Tender Agent and/or the Trustee shall, if not previously on file, execute and deliver to DTC a letter of representation in customary form with respect to the Bonds (the “Representation Letter”), but such Representation Letter shall not in any way limit the provisions of the foregoing paragraph (i) or in any other way impose upon the Issuer any obligation whatsoever with respect to persons having interests in the Bonds other than the Owners, as shown on the registration books kept by the Registrar.  The Trustee, the Tender Agent and the Paying Agent shall take all actions necessary for representations of the Issuer in the Representation Letter with respect to the Trustee, the Tender Agent and the Paying Agent to be complied with at all times.
(iii)The Issuer, with the consent of the Borrower, may, and upon request of the Borrower shall, terminate the services of DTC with respect to the Bonds.  DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice and all relevant information on the Beneficial Owners of the Bonds to the Issuer, the Borrower, the Tender Agent, if any, and the Trustee and discharging its responsibilities with respect thereto under applicable law.  Upon the discontinuance or termination of the services of DTC with respect to the Bonds, unless a substitute securities depository is appointed by the Issuer (with the consent, or at the request, of the Borrower) to undertake the functions of DTC hereunder, the Issuer, at the expense of the Borrower, is obligated to deliver Bond certificates to the Owners of such Bonds, as described in this Indenture, and such Bonds shall no longer be restricted to being registered in the registration books kept by the Registrar in the name of the 

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Nominee, but may be registered in whatever name or names Owners transferring or exchanging such Bonds shall designate, in accordance with the provisions of this Indenture.
(iv)In connection with any notice or other communication to be provided to Owners pursuant to this Indenture by the Issuer, the Borrower the Remarketing Agent, the Tender Agent, the Trustee, the Registrar, the Paying Agent, and any Co-Registrar and Co-Paying Agent with respect to any consent or other action to be taken by the Owners of the Bonds, the Issuer, the Borrower the Remarketing Agent, the Tender Agent, the Trustee, the Registrar, the Paying Agent, any Co-Registrar and Co-Paying Agent, as the case may be, the Trustee shall establish a record date for such consent or other action and give DTC notice of such record date not less than 15 calendar days in advance of such record date to the extent possible.
(v)So long as any Bond is registered in the name of the Nominee, all payments with respect to principal, purchase price, premium, if any, and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in the Representation Letter.  Owners shall have no lien or security interest in any rebate or refund paid by DTC to the Tender Agent, if any, or the Paying Agent which arises from the payment by the Tender Agent, if any, or Paying Agent of principal of or purchase price, premium, if any, or interest on the Bonds in immediately available funds to DTC.
Section 2.02Execution of Bonds.  The Bonds shall be executed on behalf of the Issuer by its President, a Vice President, Secretary, Treasurer, Assistant Secretary or Assistant Treasurer and such execution shall be attested by its President, a Vice-President, Secretary, Treasurer, Assistant Secretary or Assistant Treasurer; provided that the officer so attesting such execution shall not be the same officer that executed such Bond.  The signatures of the President, a Vice President, Secretary, Treasurer, Assistant Secretary or Assistant Treasurer of the Issuer may be facsimile signatures.

The Bonds and the interest thereon shall not be general obligations or an indebtedness of the Issuer but shall be limited obligations of the Issuer, which is obliged to pay the principal and premium, if any, and interest on the Bonds only out of the Receipts and Revenues of the Issuer from the Agreement and other moneys pledged therefor under this Indenture.  The Bonds shall never constitute an indebtedness of the State of Arizona, or the County, or the Issuer within the meaning of any Arizona Constitutional provision or statutory limitation and shall never constitute or give rise to a pecuniary liability of the State of Arizona, or the County, or the Issuer or a charge against the general credit or taxing powers of the State of Arizona, or the County, or the general credit of the Issuer and such fact shall be plainly stated on each Bond.  The Issuer has no taxing power.
The Bonds shall then be delivered to the Trustee for authentication by the Trustee.  In case any officer who shall have signed any of the Bonds shall cease to be such officer before the Bonds so signed or attested shall have been authenticated or delivered by the Trustee or issued by the Issuer, such Bonds may nevertheless be authenticated, delivered and issued and, upon such authentication, delivery and issuance, shall be as binding upon the Issuer as though those 

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who signed and attested the same had continued to be such officers of the Issuer.  Also, any Bond may be signed on behalf of the Issuer by such persons as on the actual date of the execution of such Bond shall be the proper officers although on the nominal date of such Bond any such person shall not have been such officer.
Only such of the Bonds as shall bear thereon a certificate of authentication in the form recited in Exhibit A hereto, manually executed by the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of the Trustee shall be conclusive evidence that the Bonds so authenticated have been duly authenticated and delivered hereunder and are entitled to the benefits of this Indenture.  The Trustee's certificate of authentication on any Bond shall be deemed to have been executed by it if manually signed by an authorized signatory on behalf of the Trustee but it shall not be necessary that the same person sign the certificate of authentication on all of the Bonds issued hereunder.
Upon authentication of any Bond, the Trustee, Registrar or the Tender Agent, if any, as the case may be, shall set forth on such Bond (1) the date of such authentication, and (2) in the case of a Bond bearing interest at a Bond Interest Term Rate which is not a Book-Entry Bond, such Bond Interest Term Rate, the day next succeeding the last day of the applicable Short-Term Interest Rate Period, the number of days comprising such Short-Term Interest Rate Period and the amount of interest to accrue during such Short-Term Interest Rate Period.
So long as Union Bank, N.A. is serving as Trustee hereunder, it shall also serve as Registrar hereunder.
Section 2.03Transfer and Exchange of Bonds.  Registration of any Bond may, in accordance with the terms of this Indenture, be transferred, upon the books of the Registrar required to be kept pursuant to the provisions of Section 2.04, by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by a written instrument of transfer in a form approved by the Registrar, duly executed.  Whenever any Bond shall be surrendered for registration of transfer, the Issuer shall execute and the Trustee shall authenticate and deliver a new Bond or Bonds of the same tenor in Authorized Denominations.  No registration of transfer of Bonds upon the books of the Registrar required to be kept pursuant to the provisions of Section 2.04 hereof shall be required to be made during the period after any Record Date and prior to the related Interest Payment Date or during the period of fifteen (15) days immediately preceding the date on which the Trustee mails any notice of redemption, nor shall any registration of transfer of Bonds called for redemption be required.

Bonds may be exchanged at the Principal Office of the Trustee for a like aggregate principal amount of Bonds of the same tenor of Authorized Denominations.  The Trustee shall require the payment by the Owner requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange, and there shall be no other charge to any Owners for any such exchange.  Except with respect to Bonds remarketed after being purchased pursuant to Section 4.08 hereof, no exchange of Bonds shall be required to be made during the period after any Record Date and prior to the related Interest Payment Date or during the period of fifteen (15) days immediately preceding the date on which the Trustee gives notice of redemption, nor shall any exchange of Bonds called for redemption be required.  If a Bond is 

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presented for transfer or exchange after notice of redemption of such Bond has been given as provided in Section 4.03 hereof, the Registrar shall deliver a copy of such notice of redemption to the new owner of such Bond.
Section 2.04Bond Register.  The Registrar will keep or cause to be kept at its Principal Office sufficient books for the registration and the registration of transfer of the Bonds, which shall at all times, during regular business hours, be open to inspection by the Issuer, the Trustee and the Borrower; and, upon presentation for such purpose, the Registrar shall, under such reasonable regulations as it may prescribe, register the transfer or cause to be registered the transfer, on said books, of Bonds as hereinbefore provided.
Section 2.05Bonds Mutilated Lost Destroyed or Stolen.  If any Bond shall become mutilated, the Issuer, upon the request and at the expense of the holder of said Bond, shall execute, and the Trustee shall thereupon authenticate and deliver a new Bond of like tenor in exchange and substitution for the Bond so mutilated, but only upon surrender to the Registrar of the Bond so mutilated.  Every mutilated Bond so surrendered to the Registrar shall be treated by the Trustee in accordance with its document retention policies (provided that the Trustee shall not be required to destroy such Bonds) and, upon the written request of the Issuer, a certificate evidencing such disposition shall be delivered to the Issuer, with a copy to the Borrower.  If any Bond issued hereunder shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Issuer, the Borrower and the Registrar, and if such evidence be satisfactory to them and indemnity satisfactory to them shall be given by or on behalf of the holder of such lost, destroyed or stolen Bond, the Issuer, at the expense of the holder, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor in lieu of and in substitution for the Bond so lost, destroyed or stolen (or if any such Bond shall have matured or shall be about to mature, instead of issuing a substitute Bond the Trustee shall, at the direction of the Issuer, pay the same without surrender thereof).  The Issuer may require payment of a reasonable fee for each new Bond issued under this Section and payment of the expenses which may be incurred by the Issuer and the Trustee.  Any Bond issued under the provisions of this Section in lieu of any Bond mutilated or alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the Issuer whether or not the Bond mutilated or so alleged to be lost, destroyed or stolen shall be at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Indenture with all other Bonds secured by this Indenture.
All Bonds shall be held and owned upon the express condition that, to the extent permitted by law, the foregoing provisions are exclusive with respect to the replacement or payment of lost, destroyed or improperly cancelled Bonds, notwithstanding any law or statute now existing or hereafter enacted.
Section 2.06Disposition of Cancelled Bonds.  When paid in full, all Bonds shall be delivered to the Trustee, who shall forthwith cancel such Bonds and deliver a certificate evidencing such cancellation to the Issuer and the Borrower.  The Trustee shall treat such cancelled Bonds in accordance with its document retention policies. 
Section 2.07CUSIP Number.  As provided in Section 2.01(d) of this Indenture, the Issuer in issuing the Bonds may use “CUSIP” numbers (if then generally in use), and, if so, the 

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Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to holders of Bonds; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Bonds or as contained in any notice of a redemption and that reliance may be placed only on the other identification number printed on the Bonds, and any such redemption shall not be affected by any defect in or omission of such CUSIP number.  The Issuer shall promptly notify the Trustee of any changes in the CUSIP number.
Section 2.08Other Obligations.  The Issuer expressly reserves the right to issue, to the extent permitted by law, obligations under another ordinance(s) and/or indenture(s) to provide additional funds or, at the request of the Borrower, to refund all or any principal amount of the Bonds.
Section 2.09Temporary Bonds.  Pending the preparation of definitive Bonds, the Issuer may execute and the Trustee shall authenticate and deliver temporary Bonds.  Temporary Bonds shall be issuable as fully registered Bonds, of any Authorized Denomination, and substantially in the form of the definitive Bonds but with such omissions, insertions and variations as may be appropriate for temporary Bonds, all as may be determined by the Issuer.  Temporary Bonds may contain such reference to any provisions of this Indenture as may be appropriate.  Every temporary Bond shall be executed by the Issuer and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Bonds.  As promptly as practicable, the Issuer shall execute and shall furnish definitive Bonds and thereupon temporary Bonds may be surrendered in exchange therefor without charge at the Principal Office of the Trustee, and the Trustee shall authenticate and deliver in exchange for such temporary Bonds a like aggregate principal amount of the definitive Bonds of Authorized Denominations.  Until so exchanged the temporary Bonds shall be entitled to the same benefits under this Indenture as definitive Bonds.

ARTICLE III
ISSUANCE OF BONDS
Section 3.01Authentication and Delivery of Bonds.  Forthwith upon the execution and delivery of this Indenture, the Issuer shall execute and deliver to the Trustee and the Trustee shall authenticate the Bonds and deliver the Bonds to the initial purchasers thereof as directed hereinafter in this Section 3.01.  Without any further action on the part of the Issuer, the Trustee shall authenticate the Bonds in an aggregate principal amount of Fifty-Nine Million Two Hundred Thirty-Five Thousand Dollars ($59,235,000).  Prior to the delivery on original issuance by the Trustee of any authenticated Bonds there shall be or have been delivered to the Trustee:
(i)An original duly executed counterpart of this Indenture.
(ii)An original duly executed counterpart of the Agreement.
(iii)A written order of the Issuer to the Trustee to authenticate and deliver the Bonds to the purchaser or purchasers therein identified upon payment to the 

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Trustee, but for the account of the Issuer, of a sum specified in such request and authorization plus any accrued interest on such Bonds to the date of delivery.
(iv)A written statement on behalf of the Borrower, executed by an Authorized Borrower Representative, (i) approving the issuance and delivery of the Bonds and (ii) consenting to each and every provision of this Indenture.
Section 3.02Application of Proceeds of Bonds.  The proceeds received by the Issuer from the sale of the Bonds in the amount of $59,235,000 shall be deposited with the Trustee, and the Trustee shall transfer such proceeds to Union Bank, N.A., as trustee for the Prior Bonds, to be applied to the redemption of the Prior Bonds.
Section 3.03Payment of Principal and Interest.  For the payment of interest on the Bonds, the Issuer shall cause to be deposited in the Bond Fund established under Section 5.01 hereof, on or prior to each Interest Payment Date, solely out of the Receipts and Revenues, an amount sufficient to pay the interest to become due on such Interest Payment Date.  The obligation of the Issuer to cause any such deposit to be made hereunder shall be reduced by the amount of moneys in the Bond Fund available on such Interest Payment Date for the payment of interest on the Bonds.

For the payment of the principal of the Bonds on the Maturity Date or upon earlier redemption, the Issuer shall cause to be deposited in the Bond Fund, on or prior to the Maturity Date or redemption date of the Bonds, solely out of the Receipts and Revenues, an amount sufficient to pay the principal of the Bonds then due.  The obligation of the Issuer to cause any such deposit to be made hereunder shall be reduced by the amount of moneys in the Bond Fund available on the Maturity Date or redemption date for the payment of the principal of the Bonds.

ARTICLE IV

REDEMPTION AND PURCHASE OF BONDS

Section 4.01Redemption of Bonds  The Bonds shall be subject to redemption if and to the extent the Borrower is entitled or required to make and makes a prepayment pursuant to Article IX of the Agreement.  The Trustee shall not give notice of any optional redemption under Section 4.01(a) hereof unless the Borrower has so directed in accordance with Section 9.02 of the Agreement.  In the event of a failure by the Borrower to give a notice of mandatory prepayment under Section 9.03 of the Agreement, such notice may be given by the Issuer, the Trustee or any holder or holders of ten percent (10%) or more in aggregate principal amount of the Outstanding Bonds.

The Bonds shall be redeemed upon the following terms:
(a)Redemption Upon Optional Prepayment.

(i)Extraordinary Events.  During any Long-Term Interest Rate Period, the Bonds shall be redeemed prior to the Maturity Date in whole or in part, and if in part by lot, at any time at a redemption price equal to the principal amount thereof plus accrued interest to the redemption date, upon receipt by the Trustee of a written notice of

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the Borrower and signed by an Authorized Borrower Representative stating that any of the following events has occurred (which determination shall be in the sole discretion of the Borrower) and that the Borrower therefore intends to exercise its option to prepay all payments due under the Agreement, including Repayment Installments, in whole or in part pursuant to Section 9.01 of the Agreement and thereby effect the redemption of Bonds in whole or in part to the extent of such prepayments:

(A)All or part of the Project or the Plant shall have been damaged or destroyed to such an extent that, in the opinion of the Borrower, (i) the Project or the Plant or such affected portion could not reasonably be restored within a period of four (4) months to the condition thereof immediately preceding such damage or destruction, and the Borrower or the operator of the Project or the Plant will be prevented, or is likely to be prevented for a period of four (4) consecutive months or more, from carrying on all or substantially all of its normal operation of the Project or the Plant, or (ii) the cost of restoration of the Project or the Plant or such affected portion will be substantially in excess of the net proceeds of insurance thereon.

(B)Title to, or the temporary use of, all or a part of the Project or the Plant shall have been taken under the exercise of the power of eminent domain.

(C)Changes in economic availability of raw materials, operating supplies or facilities necessary to operate all or a part of the Project or the Plant, or technological or other changes which make the continued operation of the Project or the Plant or such affected portion uneconomical, in the opinion-of the Borrower, shall have occurred and shall have resulted in a cessation of all or substantially all of the Borrower's normal operations of either the Project or the Plant.

(D)Unreasonable burdens or excessive liabilities shall have been imposed upon the Issuer or the Borrower in respect of all or a part of the Project or the Plant including, without limitation, federal, state or other ad valorem, property, income or other taxes not being imposed on the date of the Agreement, as well as any statute or regulation enacted or promulgated after the date of the Agreement that prevents the Borrower from deducting interest in respect of the Agreement for federal income tax purposes.

(ii)Borrower Option.  Subject to Section 4.12 hereof, the Bonds shall be subject to redemption prior to the Maturity Date by the exercise by the Borrower of any of its options to prepay all or part of the unpaid balance of the Repayment Installments and cause the Bonds to be redeemed, in whole, or in part by lot, prior to the Maturity Date, as follows:

(A)During any Short-Term Interest Rate Period, each Bond shall be subject to such redemption on the day next succeeding the last day of 

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each Bond Interest Term for such Bond at a redemption price equal to 100% of the principal amount thereof.

(B)During any Daily Interest Rate Period or Weekly Interest Rate Period, the Bonds shall be subject to such redemption on any Interest Payment Date at a redemption price equal to 100% of the principal amount thereof.

(C)During any Long-Term Interest Rate Period, other than the Initial Long-Term Interest  Rate Period, in excess of three (3) years that is in effect after the Initial Long-Term Interest Rate Period, the Bonds shall be subject to redemption after year three, in whole or in part, on any Business Day at 100% of the principal amount thereof unless different redemption terms shall be specified by the Borrower pursuant to Section 2.01(c)(iv)(B).  During the Initial Long-Term Interest Rate Period, the Bonds shall be subject to optional redemption, in whole or in part on any Business Day on or after August 1, 2022 at a redemption price equal to the principal amount being redeemed together with the accrued interest on such principal amount to the date fixed for redemption.

(iii)Change of Use.  During any Long-Term Interest Rate Period, the Bonds shall be subject to redemption prior to the Maturity Date upon prepayment of the Repayment Installments attributable to the Bonds at the option of the Borrower in whole or in part by lot on any Interest Payment Date, at a redemption price equal to 100% of the principal amount thereof, if the Borrower delivers to the Trustee a written or Electronic notice to the effect that either:

(A)the Borrower has determined that some or all of the interest payable under the Agreement for any sixty (60) days (which need not be consecutive) within any consecutive twenty-four (24) month period is not or will not be deductible, in whole or in part, for federal income tax purposes by reason of Section 150(b) of the Code (or would not be deductible unless some or all of the Bonds are redeemed) due to a change in use of the Project or any portion thereof, and the Borrower will not claim deductions for such interest on its federal income tax returns; or

(B)the Borrower after reasonable effort has been unable to obtain an opinion of Bond Counsel that it is more likely than not that Section 150 of the Code will not prevent interest payable under the Agreement for any sixty (60) days (which need not be consecutive) within any consecutive twenty-four (24) month period from being deductible, in whole or in part, for federal income tax purposes.

In either such case, the Borrower shall only cause the Trustee to redeem Bonds pursuant to this Section 4.01(a)(iii) on or after the Interest Payment Date immediately preceding the date on which, due to a change in use in the Project or any portion thereof, the period of potential interest expense disallowance described above commences, and the Borrower may only cause the Trustee to redeem such principal amount of Bonds as

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the Borrower determines is necessary to assure that the Borrower retains its right to all such deductions otherwise allowable or, if a partial redemption will not enable the Borrower to retain the right to deduct such interest, the Borrower may cause the Trustee to redeem all the Outstanding Bonds.
Notwithstanding any term or provision of Section 4.01(a) of this Indenture to the contrary, the Bonds shall not be subject to optional redemption unless (i) the Bank, if any, shall consent thereto in writing and deliver such consent to the Borrower and the Trustee, (ii) in connection with such redemption, the proceeds of a refunding shall be sufficient to pay, and shall be used to pay, the redemption price of the Bonds so redeemed, or (iii) sufficient Available Moneys (other than proceeds of any drawing under the Letter of Credit) shall have been deposited by the Borrower with the Trustee for the payment of all amounts due in respect of all Bonds called for redemption pursuant to Section 4.01(a) of this Indenture.  This paragraph shall be inapplicable if at the time of such optional redemption there is no Letter of Credit or other Credit Facility with respect to the Bonds.
(b)Redemption Upon Mandatory Prepayment.  The Bonds shall be subject to redemption prior to the Maturity Date from amounts which are required to be prepaid by the Borrower under Section 9.03 of the Agreement, as set forth below.

(i)The Bonds shall be redeemed in whole on any date at a redemption price equal to the principal amount thereof plus interest accrued, if any, to the redemption date, within 180 days after the occurrence of a Determination of Taxability; provided, however, that if, in the opinion of Bond Counsel delivered to the Trustee, the redemption of a specified portion of such Bonds Outstanding would have the result that interest payable on such Bonds remaining Outstanding after such redemption would remain Tax-Exempt, then such specified portion of the Bonds shall be redeemed in part by lot (in Authorized Denominations), in such amount as Bond Counsel in such opinion shall have determined is necessary to accomplish that result.

(ii)The Bonds shall be redeemed in whole at a redemption price equal to the principal amount thereof plus accrued interest to the redemption date in the event that as a result of any changes in the Constitution of the United States of America or the Constitution of the State of Arizona or as a result of any legislative, judicial or administrative action, the Agreement shall have become void or unenforceable or impossible to perform in accordance with the intention and purposes of the parties thereto, or shall have been declared unlawful.

(c)Extraordinary Mandatory Redemption.  The Bonds shall be subject to extraordinary mandatory redemption prior to the stated maturity, in whole but not in part, on any date at a redemption price equal to the principal amount thereof plus interest accrued to the redemption date immediately prior to any merger, consolidation, reorganization or conversion of the Borrower, or any sale or other disposition of all or substantially all of the Borrower's assets if the successor to such merger, consolidation or disposition 1) is not a public utility (including a holding company) regulated by the applicable state regulatory body or the Federal Energy Regulatory Commission, and 2) does not agree to assume the obligations of the Borrower under the Agreement.

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Section 4.02Selection of Bonds to be Redeemed.  If less than all the Bonds shall be called for redemption, the Trustee shall select the Bonds or any given portion thereof to be redeemed, from Outstanding Bonds or any given portion thereof not previously called for redemption, by lot.  For the purpose of any such selection the Trustee shall assign a separate number for each minimum Authorized Denomination of each Bond of a denomination of more than such minimum; provided that following any such selection, both the portion of such Bond to be redeemed and the portion remaining shall be in Authorized Denominations.  The Trustee shall promptly notify the Issuer and the Borrower in writing of the numbers of the Bonds or portions thereof so selected for redemption.  Notwithstanding the foregoing, if less than all of the Bonds are to be redeemed at any time while the Bonds are Book-Entry Bonds, selection of the Bonds to be redeemed shall be made in accordance with customary practices of DTC or the applicable successor depository, as the case may be.

Section 4.03Notice for Redemption.  The Trustee shall give notice, Electronically or by first class mail, in the name of the Issuer, of the redemption of the Bonds, not less than thirty (30) nor more than sixty (60) days prior to the redemption date for Bonds bearing interest fixed to the Maturity Date or at Daily, Weekly or Long-Term Interest Rates, and at any time not more than sixty (60) days prior to the redemption date for Bonds bearing interest at Bond Interest Term Rates.  Each notice of redemption shall (i) specify the Bonds to be redeemed, the redemption date, the redemption price, the place where amounts due upon such redemption will be payable (which shall be the Principal Office of the Paying Agent) and the source of the funds to be used for such redemption, the principal amount, the CUSIP numbers (if any) of the Bonds to be redeemed and, if less than all, the distinctive certificate numbers of the Bonds to be redeemed and, in the case of Bonds to be redeemed in part only, the respective portions of the principal amount thereof to be redeemed.  Each such notice shall also state that the interest on the Bonds designated for redemption shall cease to accrue from and after such redemption date and that on said date there will become due and payable on each of said Bonds the principal amount thereof to be redeemed, interest accrued thereon, if any, to the redemption date and the premium, if any, thereon (such premium to be specified) and shall require that such Bonds be then surrendered at the address or addresses of the Paying Agent specified in the redemption notice; provided however, the failure to duly give such notice, or any defect therein, shall not affect the validity of any proceedings for the redemption of Bonds with respect to which no such failure or defect occurred.  In the event that any Bond selected for redemption shall be tendered for purchase pursuant to Section 4.08 hereof, the Tender Agent shall note on each Bond delivered to an Owner pursuant to Section 14.04 hereof upon the purchase of such tendered Bond that such Bond has been called for redemption and the date of such redemption.  Upon presentation and surrender of Bonds so called for redemption at the place or places of payment, such Bonds shall be redeemed and cancelled.  Notice of any redemption hereunder shall also be given to the Tender Agent and the Bank.  The cost of the mailing of any such notice of redemption shall be paid by the Borrower.

With respect to any notice of optional redemption of Bonds pursuant to Section 4.01(a), unless upon the giving of such notice such Bonds shall be deemed to have been paid within the meaning of Article IX hereof, such notice shall state that such redemption shall be conditional upon the receipt by the Trustee on or prior to the date fixed for such redemption of Available Moneys sufficient to pay the principal of, premium, if any, and interest on, such Bonds to be redeemed, and that if such Available Moneys shall not have been so received said notice shall be 

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of no force and effect and the Issuer shall not be required to redeem such Bonds.  In the event that such notice of redemption contains such a condition and such Available Moneys are not so received, the redemption shall not be made and the Trustee shall within a reasonable time thereafter give notice, to the persons and in the manner in which the notice of redemption was given, that such Available Moneys were not so received.
Any notice for the redemption of any Bond mailed as provided herein shall be conclusively deemed to have been duly given whether or not such notice is received.  Failure to mail the notices required by this paragraph to any holder of a Bond, or any defect in any notice so mailed, shall not affect the validity of the proceedings for redemption of any Bonds nor impose any liability on the Trustee.
Section 4.04Partial Redemption of Bonds.  Upon surrender of any Bond redeemed in part only, the Registrar shall exchange the Bond redeemed for a new Bond of like tenor and in an Authorized Denomination without charge to the holder in the principal amount of the portion of the Bond not redeemed.  In the event of any partial redemption of a Bond which is registered in the name of the Nominee, DTC may elect to make a notation on the Bond certificate which reflects the date and amount of the reduction in principal amount of said Bond in lieu of surrendering the Bond certificate to the Registrar for exchange.  The Issuer, the Trustee and the Registrar shall be fully released and discharged from all liability upon, and to the extent of, payment of the redemption price for any partial redemption and upon the taking of all other actions required hereunder in connection with such redemption.

Section 4.05Effect of Redemption.  Notice of redemption having been duly given as aforesaid, and moneys for payment of the redemption price being held by the Trustee, the Bonds so called for redemption shall, on the redemption date designated in such notice, become due and payable at the redemption price specified in such notice, interest on the Bonds so called for redemption shall cease to accrue, said Bonds shall cease to be entitled to any lien, benefit or security under this Indenture, and the holders of said Bonds shall have no rights in respect thereof except to receive payment of the redemption price thereof (including interest, if any, accrued to the redemption date), without interest accrued on any funds held after the redemption date to pay such redemption price.

All Bonds fully redeemed pursuant to the provisions of this Article IV shall upon surrender thereof be cancelled by the Trustee, who shall deliver a certificate evidencing such cancellation to the Issuer and the Borrower.  The Trustee shall treat such cancelled Bonds in accordance with its document retention policies, provided that the Trustee shall not be required to destroy such Bonds.
Section 4.06Payment of Redemption Price.

(i)For the redemption of any of the Bonds, the Issuer shall cause to be deposited in the Bond Fund, on or prior to the date fixed for redemption, solely out of the Receipts and Revenues, an amount sufficient to pay the principal of and interest and any premium to become due on the date fixed for such redemption on the Bonds; provided that so long as a Credit Facility is in effect with respect to the Bonds and such Credit Facility does not cover some or all of the optional or mandatory redemption price, any

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amount payable as the optional or mandatory redemption price upon redemption of Bonds and not covered by such Credit Facility shall be on deposit in the Bond Fund and constitute Available Moneys prior to the Trustee giving any notice of redemption hereunder.

(ii)Moneys for payment of the principal of and interest and any premium to the date fixed for redemption on Bonds called for redemption and not presented for payment on the date fixed for redemption shall be set aside by the Trustee in trust for the Owners of such Bonds and shall be held uninvested.  Interest on such Bonds shall cease to accrue on the date fixed for redemption.

Section 4.07Reserved.

Section 4.08Purchase of Bonds.

(a)Holder's Option to Tender for Purchase.

(i)During any Daily Interest Rate Period, any Bond or portion thereof in an Authorized Denomination shall be purchased on any Business Day at a purchase price equal to 100% of the principal amount thereof plus accrued interest from the Interest Accrual Date immediately prior to the date of purchase to the date of purchase (unless the date of purchase shall be an Interest Accrual Date, in which case at a purchase price equal to the principal amount thereof), payable in immediately available funds, upon (A) delivery to the Tender Agent at its Principal Office, by no later than 11:00 a.m. (New York City time) on such Business Day, of an irrevocable written, telephonic or Electronic notice which states the principal amount of such Bond to be tendered for purchase and the date of purchase, and (B) delivery of such Bond tendered for purchase to the Tender Agent at its Principal Office on the date of purchase in accordance with Section 4.09 hereof.  The Tender Agent shall keep a written record of the notice described in Clause (A).

(ii)During any Weekly Interest Rate Period, any Bond or portion thereof in an Authorized Denomination shall be purchased on any Business Day at a purchase price equal to 100% of the principal amount thereof plus accrued interest, if any, from the Interest Accrual Date immediately prior to the date of purchase to the date of purchase (unless the date of purchase shall be an Interest Accrual Date, in which case at a purchase price equal to the principal amount thereof), payable in immediately available funds, upon (A) delivery to the Tender Agent at its Principal Office by no later than 5:00 p.m. (New York City time), on such Business Day at least seven (7) days prior to the date of purchase of an irrevocable written, telephonic or Electronic notice, which states the principal amount of such Bond to be tendered for purchase and the date of purchase, and (B) delivery of such Bond tendered for purchase to the Tender Agent at its Principal Office on the date of purchase in accordance with Section 4.09 hereof.  The Tender Agent shall keep a written record of the notice described in Clause (A).

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(iii)If any Bond is to be purchased in part pursuant to (i) or (ii) above, the amount so purchased and the amount not so purchased must each be an Authorized Denomination.

(iv)Any instrument delivered to the Tender Agent in accordance with this Section 4.08 shall be irrevocable with respect to the purchase for which such instrument was delivered and shall be binding upon any subsequent Owner of the Bond to which it relates, including any Bond issued in exchange therefor or upon the registration of transfer thereof, and as of the date of such instrument, the Owner of the Bonds specified therein shall not have any right to optionally tender for purchase such Bonds prior to the date of purchase specified in such notice.  The Tender Agent and the Trustee may conclusively assume that any person (other than a holder) providing notice of optional tender pursuant to (i) or (ii) above is the Owner of the Bond to which such notice relates, and neither the Tender Agent nor the Trustee shall assume any liability in accepting such notice from any person whom it reasonably believes to be an Owner of Bonds.

(b)Mandatory Tender for Purchase.

(i)The Bonds shall be subject to mandatory tender for purchase at a purchase price, except as provided in paragraph (ii) below, equal to 100% of the principal amount thereof, plus accrued interest to the date of purchase described below, upon the occurrence of any of the events stated below:
(A)as to any Bond, on the effective date of any change in an Interest Rate Period for such Bond, subject to Sections 2.01(b) and 2.01(c)(iv)(B), other than the effective date of any change from a Daily Interest Rate Period to a Weekly Interest Rate Period or from a Weekly Interest Rate Period to a Daily Interest Rate Period; or

(B)as to each Bond in a Short-Term Interest Rate Period, on the day next succeeding the last day of each Bond Interest Term with respect to such Bond; or

(C)as to all Bonds, on the effective date of any Credit Facility which may be provided with respect to the Bonds pursuant to Section 6.08 of the Agreement or of any substitute Credit Facility provided with respect to the Bonds pursuant to Section 6.08 of the Agreement, subject to Section 4.08(c) hereof.

(ii)In the event that on a date the Bonds are subject to optional redemption pursuant to Section 4.01(a)(ii), the Borrower elects to change the Interest Rate Period with respect to the Bonds during a Long-Term Interest Rate Period to a different Interest Rate Period or to provide, substitute or terminate a Credit Facility, if any, during a Long-Term Interest Rate Period and thereby causes a mandatory tender of such Bonds as provided in Section 4.08(b)(i)(A) or (C), as the case may be, the Bonds shall be purchased on the applicable mandatory tender date at a purchase price equal to the principal amount thereof plus an amount equal to any premium which would have

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been payable on such day had the Borrower directed redemption of the Bonds pursuant to Section 4.01(a)(ii) hereof.

(iii)The Trustee shall give notice Electronically or by first class mail of the provision of any Credit Facility with respect to the Bonds or the provision of any substitute Credit Facility with respect to the Bonds to the holders of the Bonds at their addresses shown on the registration books kept by the Registrar, not later than the fifteenth day (thirtieth day if the then current Interest Rate Period is a Long-Term Interest Rate Period) prior to the date on which the Bonds are subject to mandatory tender pursuant to Section 4.08(b)(i)(C), which notice shall (i) state the date of such provision or substitution; and (ii) state that such Bonds shall be subject to mandatory tender for purchase on the effective date of such provision or substitution in accordance with Section 4.08(b)(i)(C) hereof.

(c)Mandatory Tender for Purchase on Termination or Expiration of Credit Facility.  In the event that any Credit Facility either is to terminate or is to expire in accordance with its terms (other than because a final drawing thereunder shall have been made in accordance with its terms), unless the term of the Credit Facility shall be extended or unless the Borrower shall provide the Trustee, no later than the 35th day preceding the mandatory purchase date set forth herein with a substitute Credit Facility and with written evidence from Moody's, if the Bonds shall be rated at the time by Moody's, and from S&P, if the Bonds shall be rated at the time by S&P, to the effect that such substitute Credit Facility will not, by itself, result in a reduction or withdrawal of the rating on the Bonds by Moody's or S&P, as the case may be (and the Trustee shall have received written notice of such extension or such substitution and evidence thereof prior to giving the notice required in paragraph (b) above), the Bonds shall be subject to mandatory tender for purchase at a purchase price, payable in immediately available funds, of 100% of their principal amount, plus accrued interest, if any, to the mandatory purchase date, on the second Business Day prior to the date of such termination or expiration.

Section 4.09Delivery of Tendered Bonds.  With respect to any Book-Entry Bond, delivery of such Bond to the Tender Agent in connection with any optional or mandatory tender pursuant to Section 4.08 hereof shall be effected by the making of, or the irrevocable authorization to make, appropriate entries on the books of DTC or any DTC Participant to reflect the transfer of the beneficial ownership interest in such Bond to the account of the Tender Agent, or to the account of a DTC Participant acting on behalf of the Tender Agent.  With respect to any Bond which is not a Book-Entry Bond, delivery of such Bond to the Tender Agent in connection with any optional or mandatory tender pursuant to Section 4.08 hereof shall be effected by physical delivery of such Bond to the Tender Agent at its Principal Office, by 1:00 p.m. (New York City time) on the purchase date, accompanied by a proper instrument of transfer thereof, in a form satisfactory to the Tender Agent, executed in blank by the holder thereof with the signature of such holder guaranteed in accordance with the guidelines set forth by one of the nationally recognized medallion signature programs.
Section 4.10Bonds Deemed Purchased.

(a)If moneys sufficient to pay the purchase price of Bonds to be purchased pursuant to Section 4.08 shall be held by the Tender Agent on the date such Bonds are to be

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purchased, such Bonds shall be deemed to have been purchased for all purposes of this Indenture, irrespective of whether or not such Bonds shall have been delivered to the Tender Agent, and neither the former holder of such Bonds nor any other person shall have any claim thereon, under this Indenture or otherwise, for any amount other than the purchase price thereof.

(b)In the event of non-delivery of any Bond to be purchased pursuant to Section 4.08 hereof, the Tender Agent shall segregate and hold uninvested the moneys for the purchase price of such Bonds in trust, without liability for interest thereon, for the benefit of the former holders of such Bonds, who shall, except as provided in the following sentence, thereafter be restricted exclusively to such moneys for the satisfaction of any claim for the purchase price of such Bonds.  Any moneys which the Tender Agent shall segregate and hold in trust for the payment of the purchase price of any Bond and remaining unclaimed for two (2) years after the date of purchase shall be paid, upon the Borrower's written request, to the Borrower.  After the payment of such unclaimed moneys to the Borrower, the former holder of such Bond shall look only to the Borrower for the payment thereof.

Section  4.11Reserved.

Section 4.12Purchase in Lieu of Redemption.  Notwithstanding any other provision in this Indenture, at any time that the Bonds are called for redemption under this Article IV, the Trustee, on behalf of the Borrower, may purchase such Bonds in lieu of redemption at a price equal to the amount payable upon the redemption of such Bonds.  During the Initial Long-Term Interest Rate Period, any adjustment or proposed adjustment to a new Interest Rate Period on a day on which the Bonds would be permitted to be redeemed at the option of the Borrower pursuant to Section 4.01(a)(ii)(C) hereof shall be deemed to be accomplished pursuant to a purchase of such Bonds in lieu of a redemption pursuant to this Section.

ARTICLE V

THE BOND FUND

Section 5.01Creation of Bond Fund.  There is hereby created by the Issuer and ordered established with the Trustee a trust fund in the name of the Issuer to be designated “Maricopa County, Arizona Pollution Control Corporation Pollution Control Refunding Revenue Bonds, 2012 Series A (El Paso Electric Company Palo Verde Project) Bond Fund” (the “Bond Fund”).  The Trustee shall establish one or more accounts within the Bond Fund for the purpose of segregating moneys drawn under a Credit Facility, if any, and Available Moneys therein, and may establish one or more accounts within the Bond Fund for other purposes.

Section 5.02Deposits into Bond Fund.

There shall be deposited in the Bond Fund:
(i)The accrued interest and purchase premium, if any, paid by the initial purchasers of the Bonds;

(ii)All Repayment Installments and moneys drawn by the Trustee under a Credit Facility for the payment of principal of and interest and any premium on 

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the Bonds, other than moneys drawn under a Credit Facility pursuant to subsection (b) of Section 6.02 hereof,
(iii)All other moneys received by the Trustee under and pursuant to any provision of the Agreement, other than Sections 5.04, 5.07 and 8.05 thereof, or from any other source when accompanied by directions by the Borrower that such moneys are to be paid into the Bond Fund; and

(iv)All moneys required to be deposited therein under any other provision of this Indenture.

Section 5.03Use of Moneys in Bond Fund.  Except as otherwise provided in Sections 5.05, 5.06, 5.07, 9.01, 10.10 and 11.04 hereof, moneys in the Bond Fund shall be used solely for the payment of the principal of and interest and any premium on the Bonds as the same shall become due and payable on an Interest Payment Date or at the Maturity Date, upon redemption or acceleration or otherwise.  Funds for such payments of the principal of and interest and any premium on the Bonds shall be derived from the following sources in the order of priority indicated:

(i)moneys paid into the Bond Fund pursuant to Section 5.02(i) hereof, which shall be applied to the payment of interest on the Bonds;

(ii)proceeds of the sale of refunding obligations and proceeds from the investment thereof, deposited into the Bond Fund which constitute Available Moneys;

(iii)moneys furnished by the Borrower to the Trustee pursuant to the Agreement which have been deposited into the Bond Fund and constitute Available Moneys (other than funds under a Credit Facility) and proceeds from the investment thereof,

(iv)moneys drawn by the Trustee under a Credit Facility for the payment of the principal of or interest or any premium on the Bonds and deposited into the Bond Fund;

(v)moneys furnished by the Borrower to the Trustee pursuant to the Agreement and any other moneys available therefor and proceeds from the investment thereof-,

(vi)In addition to amounts required to be paid into the Bond Fund, the Trustee shall in the case of Bonds to be purchased by the Tender Agent on behalf of the Borrower pursuant to Article IV hereof, draw moneys under a Credit Facility in accordance with the terms thereof to the extent necessary to make timely payments of the purchase price of the Bonds pursuant to such Article IV, but only to the extent moneys are not available from the sources set forth in clauses (i) and (ii) of Section 6.02(b) hereof, and furnish said moneys to the Tender Agent; provided, however, that the principal of, premium, if any, and interest on Bonds held by the Borrower, the Tender Agent or the Trustee on behalf of the Borrower (or any affiliate thereof), shall not be paid from moneys drawn under such Credit Facility.

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Section 5.04Credit Facility.

(a)No Credit Facility relating to the Bonds will be delivered as of-the date of issuance and delivery of the Bonds.  During the Initial Long-Term Interest Rate Period, no Credit Facility relating to the Bonds shall be permitted to be delivered until such time as the Bonds are permitted to be optionally redeemed hereunder pursuant to Section 4.01(a)(ii)(C).  A Credit Facility shall be required if the Bonds are converted to any Interest Rate Period other than a Long-Term Interest Rate Period.

(b)A Credit Facility shall be the obligation of a Bank to pay to the Trustee, in accordance with the terms thereof, such amounts as shall be specified therein and available to be drawn thereunder for the timely payment of the principal of and interest and, if permitted by a Credit Facility, any premium on the Bonds (whether at the Maturity Date, or upon acceleration or redemption or otherwise), and portions of the purchase price of Bonds corresponding to principal and interest thereon, and, if permitted by a Credit Facility, portions of the purchase price corresponding to premium on the Bonds, required to be made pursuant to, and in accordance with the provisions of this Indenture.  Such Credit Facility shall be reduced to the extent of any drawings thereunder and reinstated in accordance with the terms thereof.

(c)The Trustee shall draw moneys under a Credit Facility in accordance with the terms hereof and the terms of the Tender Agreement to the extent necessary to make timely payments of principal of and interest and any premium, if drawings thereunder shall be available to pay premium, on the Bonds required to be made from the Bond Fund or to enable the Tender Agent to pay the purchase price of Bonds purchased pursuant to Section 6.02(b) hereof, provided, however, that, anything herein to the contrary notwithstanding, in no event shall the Trustee draw moneys under such Credit Facility in order to make payments of principal of or interest or any premium on, or to enable the Tender Agent to pay the purchase price of, Bonds held of record by the Borrower (or any affiliate thereof) or held by the Tender Agent or the Trustee for the account of the Borrower or delivered to and held of record by, or held for the account of, the Bank pursuant to Section 14.04(c) hereof if such Credit Facility prohibits by its terms a drawing thereunder for such purpose; provided, further, however, that the Trustee may draw moneys under such Credit Facility in order to make payment of interest on Bonds held of record by the Borrower (or any affiliate thereof), the Bank or by the Tender Agent or the Trustee for the account of the Borrower or the Bank pursuant to Section 14.04(c) hereof if such Bond was not so held by or for the account of the Borrower or the Bank on the immediately preceding Record Date.  Upon any reduction in the aggregate principal amount of Bonds Outstanding, the Trustee shall request the Bank to permanently reduce the amounts that may be drawn under the applicable Credit Facility to those amounts which are then required pursuant to Section 6.08 of the Agreement.  For extensions of the term of a Credit Facility, the Trustee shall surrender the applicable Credit Facility to the Bank (if so directed by the Bank) in exchange for a Credit Facility of the Bank conforming in all material respects to the applicable Credit Facility except that the expiration date shall be extended.  If at any time there shall cease to be any Bonds Outstanding hereunder, the Trustee shall promptly surrender the applicable Credit Facility to the Bank, in accordance with the terms of the applicable Credit Facility, for cancellation.

(d)If at any time there shall have been delivered to the Trustee, all as described in and in accordance with Section 6.08 the Agreement, (i) a notice of the Borrower,  

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(ii) the required opinion of Bond Counsel, and (iii) a Credit Facility, if any, described in such notice, then the Trustee shall accept such Credit Facility, if any, and comply with the direction of the Borrower, if any, contained in such notice.  If the delivery of such Credit Facility does not result in a mandatory tender for purchase of all Bonds pursuant to Section 4.08(b) hereof, the Trustee shall give notice by first-class mail of the delivery of such Credit Facility to the Owners of the Bonds not less than 20 days prior to the date of the expiration or termination of a Credit Facility then in effect.  Such notice shall state that the Borrower has caused to be provided the new Credit Facility, shall describe the new Credit Facility (including its effective date and scheduled expiration date) and shall state that the Borrower has delivered written evidence from Moody's, if the Bonds are then rated by Moody's and from S&P, if the Bonds are then rated by S&P, that none of Moody's nor S&P will reduce or withdraw its rating then in effect with respect to the Bonds as a result of the proposed delivery of the new Credit Facility.

Section 5.05Custody of Bond Fund; Withdrawal of Moneys.  The Bond Fund shall be in the custody of the Trustee but in the name of the Issuer and the Issuer hereby irrevocably authorizes and directs the Trustee to withdraw from the Bond Fund and furnish to the Paying Agent funds sufficient to pay the principal of and interest and any premium on the Bonds as the same shall become due and payable, and to withdraw from the Bond Fund funds sufficient to pay any other amounts payable therefrom as the same shall become due and payable.  If and to the extent that moneys remain in the Bond Fund after payment of such principal, interest and premium, if any, and are not required to be held therein pursuant to Section 5.06 hereof, such moneys shall be paid to the Bank, to the extent that there shall then be amounts due and payable to the Bank pursuant to the Reimbursement Agreement and the Bank has notified the Trustee thereof; provided, however, that if no Bank exists, such moneys shall be paid to the Borrower.

Section 5.06Bonds Not Presented for Payment.  In the event any Bond shall not be presented for payment when the principal thereof (or any portion of such principal) becomes due, either at the Maturity Date or at the date fixed for redemption thereof or otherwise or in the event that any interest payment remains unclaimed, if moneys sufficient to pay such Bonds or portions thereof or such interest are held by the Paying Agent for the benefit of the Owners thereof, the Paying Agent shall segregate and hold such moneys uninvested without liability for interest thereon, for the benefit of Owners of such Bonds, who shall, except as provided in the following paragraph, thereafter be restricted exclusively to such fund or funds for the satisfaction of any claim of whatever nature on their part under this Indenture or relating to said Bonds.

Any moneys which the Paying Agent shall segregate and hold for the payment of the principal of or interest or any premium on any Bond and remaining unclaimed for two years after such principal, interest or any premium shall have become due and payable shall be paid to the extent legally permissible (i) if, at the time, there shall be amounts due and payable to the Bank pursuant to the Reimbursement Agreement, or (ii) if no such amounts shall be due and payable, to the Borrower, with notice to the Trustee of such action.  For purposes of this Indenture, the Paying Agent may conclusively assume that no such indebtedness, liability or obligation is owing to the Bank unless the Bank shall otherwise give written notice to the Paying Agent.  After the payment of such unclaimed moneys to the Bank or the Borrower, the Owner of such Bond shall look only to the Borrower for the payment thereof.

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Section 5.07Moneys Held in Trust.  All moneys required to be deposited with or paid to the Trustee for deposit into the Bond Fund under any provision hereof and all moneys withdrawn from the Bond Fund and held by the Trustee or the Paying Agent shall be held by the Trustee or the Paying Agent, as the case may be, in trust, and such moneys (other than moneys held pursuant to Section 5.06 hereof) shall, while so held, constitute part of the Trust Estate and be subject to the lien hereof for the benefit of the Owners.

Section 5.08Payment to the Bank and to the Borrower.  Any moneys remaining in the Bond Fund after the right, title and interest of the Trustee in and to the Trust Estate and all covenants, agreements and other obligations of the Issuer under this Indenture shall have ceased, terminated and become void and shall have been satisfied and discharged in accordance with Article IX hereof, shall be paid (a) if, at that time, there shall be amounts due and payable to the Bank pursuant to the Reimbursement Agreement, if any, and the Bank has notified the Trustee thereof, to the Bank, or (b) no such amounts shall be so due and payable, to the Borrower.

ARTICLE VI

PURCHASE FUND

Section 6.01Tender Agent.  By acceptance of its appointment under Section 14.01(b) hereof, the Tender Agent agrees:

(a)to hold all Bonds delivered to it pursuant to Section 4.09 hereof, as agent and bailee of, and in escrow for the benefit of, the respective Owners which shall have so delivered such Bonds until moneys representing the purchase price of such Bonds shall have been delivered to or for the account of or to the order of such Owners;

(b)to establish and maintain, and there is hereby established with the Tender Agent, a separate segregated trust fund designated as the “Maricopa County, Arizona Pollution Control Corporation Pollution Control Refunding Revenue Bonds, 2012 Series A (El Paso Electric Company Palo Verde Project) Purchase Fund” (the “Purchase Fund”) until such time as it has been discharged from its duties as Tender Agent hereunder;

(c)to hold all moneys (without investment thereof) delivered to it hereunder in the Purchase Fund for the purchase of Bonds pursuant to Section 4.08 hereof, other than moneys delivered to it by the Borrower during the term of a Credit Facility, as agent and bailee of, and in escrow for the benefit of, the person or entity which shall have so delivered such moneys until the Bonds purchased with such moneys shall have been delivered to or for the account of such person or entity;

(d)to hold all moneys delivered to it by the Borrower for the purchase of Bonds pursuant to Section 4.08 hereof, as agent and bailee of, and in escrow for the benefit of, the Owners or former Owners who shall deliver Bonds to it for purchase until the Bonds purchased with such moneys shall have been delivered to or for the account of the Borrower; provided, however, that if the Bonds shall at any time become due and payable, the Tender Agent shall cause such moneys (other than moneys held pursuant to Section 6.03(d) hereof) to be deposited into the Bond Fund;

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(e)to hold all Bonds registered in the name of the new Owners thereof which have been delivered to it by the Trustee for delivery to the Remarketing Agent in accordance with the Tender Agreement;

(f)to hold Bonds for the account of the Borrower as contemplated by Section 14.04(c) hereof, such Bonds to be released to or upon the order of the Borrower upon receipt by the Tender Agent from the Bank of a notice to the effect that the Trustee is entitled to draw under a Credit Facility to pay principal of the Bonds and to pay the purchase price of Bonds tendered under Section 4.08 hereof and not remarketed in an amount equal to the amount that could be drawn under a Credit Facility if the drawing made to purchase such Bonds were disregarded;

(g)to hold Bonds for the account of the Bank (or its nominee), or to deliver Bonds to the Bank, as contemplated by Section 14.04(c) hereof, and

(h)to keep such books and records with respect to the Bonds as shall be consistent with prudent industry practice and to make such books and records available for inspection by the Issuer, the Trustee, the Borrower and the Remarketing Agent at all reasonable times.

(b)     The Issuer shall cooperate with the Borrower and the Trustee to cause the necessary arrangements to be made and to be thereafter continued to enable the Tender Agent to perform its duties and obligations described above.

Section 6.02Notice of Bonds Delivered for Purchase; Purchase of Bonds.

(a)The Tender Agent shall determine timely and proper delivery of Bonds pursuant to this Indenture and the proper endorsement of such Bonds.  Such determination shall be binding on the Owners of such Bonds, the Issuer, the Borrower, the Remarketing Agent, the Trustee and the Bank absent manifest error.  As promptly as practicable, the Tender Agent shall give telephonic or Electronic notice, promptly confirmed by a written notice, to the Bank, if any, the Trustee, the Remarketing Agent, the Registrar and the Borrower specifying the principal amount of Bonds, if any, for which it has received notice of tender for purchase in accordance with Section 4.08(a)(i) or 4.08(a)(ii) hereof.

(b)Bonds required to be purchased in accordance with Section 4.08 hereof shall be purchased from the Owners thereof by the Tender Agent, on the date and at the purchase price at which such Bonds are required to be purchased.  Funds for the payment of such purchase price by the Tender Agent from the Owners of Bonds shall be derived from the following sources in the order of priority indicated:

(i)moneys furnished to the Tender Agent for deposit into the Purchase Fund representing moneys provided by the Borrower pursuant to Section 10.02 of the Agreement, which constitute Available Moneys;

(ii)proceeds of the sale of such Bonds remarketed to any person, other than the Issuer, the Borrower or an affiliate thereof, pursuant to Section 14.03 hereof and furnished to the Tender Agent by the Remarketing Agent for deposit into the Purchase Fund;

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(iii)moneys furnished to the Tender Agent by the Trustee for deposit into the Purchase Fund representing the proceeds of a drawing under a Credit Facility; and

(iv)moneys furnished to the Tender Agent representing moneys provided by the Borrower (or any affiliate thereof) pursuant to Section 10.01 or 10.02 of the Agreement or otherwise available for such purpose.

Moneys described in clause (iii) may not be used to purchase Bonds held of record by the Borrower (or any affiliate thereof) or by the Tender Agent for the account of the Borrower.
The Tender Agent shall establish separate accounts or subaccounts within the Purchase Fund for each deposit made into the Purchase Fund so that (1) the Tender Agent may at all times ascertain the date of deposit of the funds in each account or subaccount, and (2) the amounts derived from the source described in clause (iii) may be segregated from other sources and such amounts shall not be commingled with any funds from the sources described in clause (iv).
(c)The Trustee shall authenticate a new Bond or Bonds in an aggregate principal amount equal to the principal amount of Bonds purchased in accordance with Section 6.02(b) hereof, whether or not the Bonds so purchased are presented by the Owners thereof, bearing a number or numbers not contemporaneously outstanding.  Every Bond authenticated and delivered as provided in this Section 6.02(c) shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Bonds duly issued hereunder, except as provided in Section 5.04(c) hereof.  The Tender Agent shall maintain a record of the Bonds purchased as provided in this Section 6.02, together with the names and addresses of the former Owners thereof.

(d)In the event any Bonds purchased as provided in this Section 6.02 shall not be presented to the Tender Agent, the Tender Agent shall segregate and hold the moneys for the purchase price of such Bonds in trust for the benefit of the former Owners of such Bonds, who shall, except as provided in the following sentence, thereafter be restricted exclusively to such moneys for the satisfaction of any claim for the purchase price of such Bonds.  Any moneys which the Tender Agent shall segregate and hold in trust for the payment of the purchase price of any Bond and remaining unclaimed for two years after the date of purchase shall, to the extent legally permissible, upon the Borrower's written request to the Tender Agent, be paid to the Bank, if the Borrower then owes funds under the Reimbursement Agreement, or otherwise to the Borrower.  After the payment of such unclaimed moneys to the Borrower, the former Owner of such Bond shall look only to the Borrower for the payment thereof.

ARTICLE VII

INVESTMENTS

Section 7.01Investments.  The moneys in the Bond Fund (other than the moneys described in Sections 4.06(ii), 5.04(c) and 5.06 hereof, which may not be invested) shall, but only at the direction of the Borrower, be invested and reinvested in Investment Securities to the extent not prohibited by applicable law as determined by the Borrower.  The income from, and 

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any gain or loss from, any investment shall be credited or charged to the Bond Fund from which such investment was made.  Investment Securities will be registered in the name of the Trustee or its nominee and held by or under the control of the Trustee.  Subject to the further provisions of this Section 7.01, such investment shall be made, and such agreements entered into, by the Trustee as directed and designated by the Borrower in a certificate of an Authorized Borrower Representative.  In the absence of any such direction, the Trustee shall invest all funds in the Investment Securities defined by clause (viii) of the definition thereof.  As and when any amounts thus invested (including investments of Available Moneys) may be needed for disbursements from the Bond Fund, the Trustee shall cause a sufficient amount of such investments to be sold or otherwise converted into cash to the credit of such Bond Fund.  As long as no Event of Default (as defined in Section 10.01 hereof) shall have occurred and be continuing, the Borrower shall have the right to designate the investments to be sold and to otherwise direct the Trustee in the sale or conversion to cash of the investments made with the moneys in the Bond Fund; provided that, the Trustee shall be entitled to conclusively assume the absence of any such Event of Default unless it has notice thereof within the meaning of Section 11.05 hereof.  The Trustee shall have no responsibility under this Indenture with respect to the compliance by the Borrower or the Issuer with any covenant herein or in the Agreement regarding the yield on, or tax-exempt nature of investments made in accordance with this Section 7.01, other than to use its best efforts to comply with instructions from the Borrower or the Issuer regarding such investments and the Trustee shall bear no responsibility for losses incurred from such investments or the sale thereof.  Moneys held by the Tender Agent in the Purchase Fund shall not be invested.  The Trustee may acquire or sell any Investment Security through itself or an affiliate, as principal or agent.

The Trustee shall furnish the Issuer and the Borrower periodic cash transaction statements which include detail for all investment transactions effected by the Trustee or brokers selected by the Issuer and the Borrower.  Upon the Issuer and the Borrower's election, such statements will be delivered via the Trustee's Online Trust and Custody service and upon electing such service, paper statements will be provided only upon request.  The Issuer and the Borrower waive the right to receive brokerage confirmations of security transactions effected by the Trustee as they occur, to the extent permitted by law.  The Issuer and the Borrower further understand that trade confirmations for securities transactions effected by the Trustee will be available upon request and at no additional cost and other trade confirmations may be obtained from the applicable broker.

ARTICLE VIII

GENERAL COVENANTS

Section 8.01Limited Obligation; Payment of Principal and Interest.  Each and every covenant herein made, including all covenants made in the various Sections of this Article VIII, is predicated upon the condition that any obligation for the payment of money incurred by the Issuer shall not be the general obligation of the Issuer within the meaning of the Constitution of Arizona, and shall never constitute an indebtedness of the Issuer within the meaning of any State of Arizona constitutional provision or statutory limitation, and shall never constitute or give rise to any pecuniary liability of the Issuer or a charge against its general credit or taxing powers, but shall be payable by the Issuer solely from the Receipts and Revenues from the Agreement, which 

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are required to be set apart and transferred to the Bond Fund, and which, along with the balance of the Trust Estate, are hereby specifically pledged to the payment thereof in the manner and to the extent specified in this Indenture, and nothing in the Bonds or in this Indenture shall be considered as pledging or obligating any other funds or assets of the Issuer.

The Issuer will in the manner provided herein and in the Bonds, according to the true intent and meaning thereof, promptly cause to be paid, solely from the sources stated herein, at the place and on the dates provided herein, the principal of and premium, if any, and interest on every Bond issued under this Indenture.
Section 8.02Performance of Agreements; Authority.  The Issuer will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Indenture, in any and every Bond executed, authenticated and delivered hereunder, and in all proceedings pertaining thereto.  The Issuer represents that it has the authority under the Constitution and laws of the State of Arizona to issue the Bonds authorized hereby, to enter into the Agreement, and to pledge to the Trustee the Receipts and Revenues from the Agreement and to pledge and assign to the Trustee all or any part of the Issuer's right, title and interest under the Agreement pledged and assigned hereunder, and that the Bonds in the hands of the Owners thereof are and will be valid and enforceable obligations of the Issuer according to the import thereof.

Section 8.03Maintenance of Corporate Existence; Compliance with Laws.  The Issuer will at all times maintain its corporate existence or assure the assumption of its obligations under this Indenture by any public body succeeding to its powers under the Act, and it will use its best efforts to maintain, preserve and renew all the rights and powers provided to it by the Act; and it will comply with all valid acts, rules, regulations, orders and directions of any legislative, executive, administrative or judicial body applicable to the Agreement.

Section 8.04Enforcement of Borrower's Obligations under the Agreement.  So long as any of the Bonds are Outstanding, upon receipt of written notification from the Trustee, the Issuer will, in the manner provided herein and giving due recognition to the role of the Trustee hereunder, enforce the obligation of the Borrower to pay, or cause to be paid, all the payments and other costs and charges payable by the Borrower under the Agreement, provided, however, that the Issuer shall not be required to spend any of its own funds in any such enforcement.  The Issuer will not enter into any agreement with the Borrower amending the Agreement without the prior written consent of the Trustee and compliance with Sections 13.06 and 13.07 hereof.

Section 8.05Further Assurances.  The Issuer will, upon the reasonable request of the Trustee, from time to time execute and deliver such further instruments and take such further action as may be reasonable and as may be required to carry out the purpose of this Indenture; provided, however, that no such instruments or actions shall give rise to any pecuniary liability of the Issuer or pledge the credit or taxing power of the State of Arizona, the Issuer or any other political subdivision of said State.

Section 8.06No Disposition or Encumbrance of Issuer's Interests.  Except as permitted by this Indenture, the Issuer will not sell, lease, pledge, assign or otherwise dispose of or encumber its interest in the Receipts and Revenues from the Agreement or its rights and interest 

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under the Agreement pledged and assigned hereunder and will promptly pay or cause to be discharged or make adequate provision to satisfy and discharge any lien or charge on any part thereof not permitted by this Indenture.

Section 8.07Trustee's Access to Books Relating to Facilities.  All books and documents in the possession of the Issuer relating to the Facilities and the moneys, revenues and receipts derived from the Facilities shall at all reasonable times be open to inspection by such accountants or other agencies as the Trustee may from time to time designate.  The Trustee shall permit the Borrower or its designee reasonable access to records relating to the investment of the proceeds of the Bonds or any other records relating to the Bonds necessary to assure compliance with Section 148 of the Code.

Section 8.08Filing of Financing Statements.  Appropriate financing statements, naming the Trustee as secured party with respect to the Receipts and Revenues from the Agreement and the other moneys pledged by the Issuer under this Indenture for the payment of the principal of and premium, if any, and interest on the Bonds, and as pledgee and assignee of certain of the Issuer's rights and interest under the Agreement, shall be duly filed and recorded in the appropriate state and county offices as required by the provisions of the Uniform Commercial Code or other similar law as adopted in the State of Arizona, the state in which lies the Principal Office of the Trustee and any other applicable jurisdiction, as from time to time amended.  The Trustee will file and record, with such assistance as necessary from the Issuer and the Borrower, such necessary continuation statements from time to time as may be required pursuant to the provisions of said Uniform Commercial Code or other similar law to protect the interest of the Trustee.

Section 8.09Tax Covenant.  The Issuer covenants for the benefit of the purchasers of the Bonds that it will not take any action or fail to take any action reasonably within its control which would, under the Code, Regulations of the Department of the Treasury of the United States of America (including Temporary Regulations and Proposed Regulations) under the Code applicable to the Bonds, rulings and court decisions, cause the interest payable on the Bonds to be includable in the gross income of the holders thereof for Federal income tax purposes (other than a “substantial user” of the Facilities or a “related person” as those terms are used in Section 147(a) of the Code).  Pursuant to such covenant, the Issuer obligates itself to comply throughout the term of the issue of the Bonds with the requirements of Section 148 of the Code and any regulations promulgated thereunder.

The Borrower by its execution of the Agreement has covenanted to restrict the investment of money in the funds created under this Indenture in such manner and to such extent, if any, as may be necessary, so that the Bonds will not constitute “arbitrage bonds” under Section 148 of the Code.
Section 8.10Notices by Trustee.  The Trustee shall give the same notices to the Issuer that it is required to give to the Borrower, and to the Borrower that it is required to give to the Issuer, pursuant to the terms of this Indenture and, additionally, shall give written or Electronic notice to the Issuer, the Borrower and the Remarketing Agent of any prior redemption pursuant to Section 4.01 hereof.

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Section 8.11No Transfer of Credit Facility.  Except as provided in Section 5.04 hereof, the Trustee shall not sell, assign or transfer a Credit Facility except to a successor trustee under this Indenture and as contemplated by Section 11.16 hereof.

ARTICLE IX

DEFEASANCE

Section 9.01Defeasance.  If the Issuer shall pay or cause to be paid with Available Moneys to the Owner of any Outstanding Bond secured hereby the principal of and interest and any premium due and payable, and thereafter to become due and payable, on such Bond, or any portion of such Bond in an Authorized Denomination, such Bond or portion thereof shall cease to be entitled to any lien, benefit or security under this Indenture (except as set forth in Section 9.02 hereof).  If the Issuer shall pay or cause to be paid with Available Moneys to the owners of all the Bonds the principal thereof and interest and any premium due and payable and thereafter to become due and payable thereon, and shall pay or cause to be paid all other sums payable hereunder by the Issuer, or payable under the Agreement by the Borrower, then the right, title and interest of the Trustee in and to the Trust Estate shall thereupon cease, terminate and become void.  In such event, the Trustee shall assign, transfer and turn over the Trust Estate, including, without limitation, any surplus in the Bond Fund and any balance remaining in any other fund created under this Indenture, (i) if, at that time, there shall be amounts due and payable to the Bank pursuant to the Reimbursement Agreement and the Bank has notified the Trustee thereof, to the Bank, or (ii) if no such amounts shall be so due and payable, to the Borrower.

All Outstanding Bonds shall, prior to the Maturity Date or redemption date thereof, be deemed to have been paid within the meaning and with the effect expressed in this Article IX (except as set forth in Section 9.02 hereof) when
(a)in the event the Bonds are to be redeemed, the Trustee shall have given, or the Borrower shall have given to the Trustee in form satisfactory to the Trustee irrevocable instruction to give, on a date in accordance with the provisions of Article IV hereof, notice of redemption of the Bonds,

(b)there shall have been deposited with the Trustee either moneys in an amount which shall be sufficient, or fixed rate Government Obligations (i) which shall not contain provisions permitting the redemption or prepayment thereof at the option of the issuer thereof, (ii) which mature no later than the earlier of (A) the date fixed for the redemption of the Bonds and (B) the Maturity Date, and (iii) the principal of and the interest on which, when due, and without any regard to reinvestment thereof, will provide moneys which, together with the moneys, if any, deposited with or held by the Trustee, shall be sufficient, based on the written opinion of a firm of certified public accountants acceptable to the Trustee, delivered to the Trustee, to pay when due the principal of and interest and any premium due and to become due on the Bonds on and prior to the redemption date or Maturity Date, as the case may be; provided, however, that such moneys shall constitute Available Moneys and that such Government Obligations shall have been purchased with Available Moneys, and provided further, that if a forward supply contract is employed in connection with the redemption, such certified public accountant's opinion shall expressly state that the adequacy of the Available Moneys and 

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Government Obligations to accomplish the redemption relies solely on the initial deposited investments and the maturing principal thereof and interest income thereon and does not assume performance under or compliance with the forward supply contract, and

(c)in the event the Bonds do not mature and are not to be redeemed within the next succeeding 60 days, the Borrower shall have given the Trustee, in form satisfactory to it, irrevocable instructions to give, as soon as practicable in the same manner as a notice of redemption is given pursuant to Section 4.03 hereof, a notice to the Owners that the deposit required by clause (b) above has been made with the Trustee and that the Bonds are deemed to have been paid in accordance with this Article IX and stating the Maturity Date or redemption date upon which moneys are to be available for the payment of the principal of and interest and any premium on the Bonds.

Neither the Government Obligations nor moneys deposited with the Trustee pursuant to this Article IX nor principal or interest payments on any such Government Obligations shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the principal of and interest and any premium on the Bonds; provided that any cash received from such principal or interest payments on such Government Obligations deposited with the Trustee, if not then needed for such purpose, shall be invested, to the extent practicable, at the direction of the Borrower, in Government Obligations of the type and tenor described in clause (b) of the immediately preceding paragraph, and interest earned from such reinvestment shall be paid as received by the Trustee (i) if, at that time, there shall be amounts due and payable to the Bank pursuant to the Reimbursement Agreement and the Bank has notified the Trustee thereof, to the Bank, or (ii) if no such amounts shall be so due and payable, to the Borrower.

Section 9.02Survival of Certain Provisions.  Notwithstanding the foregoing, any provisions of this Indenture which relate to the payment of the principal of or any premium on Bonds at the Maturity Date or pursuant to redemption, as the case may be, interest payments and dates thereof, exchange, transfer and registration of Bonds, replacement of mutilated, destroyed, lost or stolen Bonds, the safekeeping and cancellation of Bonds, non-presentment of Bonds, the holding of moneys in trust and repayments to the Bank or the Borrower from the Bond Fund or the Purchase Fund and the duties of the Trustee, the Registrar, the Remarketing Agent and the Paying Agent in connection with all of the foregoing, shall remain in effect and be binding upon the Issuer, the Trustee, the Remarketing Agent, the Tender Agent, the Registrar, the Paying Agent and Owners notwithstanding the release and discharge of this Indenture.  The provisions of this Section shall survive the release, discharge and satisfaction of this Indenture; provided, however, that the provisions of Section 2.01 hereof, permitting adjustments in the Interest Rate Period with respect to the Bonds, shall not be in effect after the release and discharge of this Indenture.

ARTICLE X

DEFAULTS AND REMEDIES

Section 10.01Events of Default.

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(a)Each of the following events shall constitute and is referred to in this Indenture as an “Event of Default”:

(i)a failure to pay the principal of or any premium on any of the Bonds when the same shall become due and payable at the Maturity Date or upon redemption;

(ii)a failure to pay an installment of interest on any of the Bonds after such interest has become due and payable;

(iii)a failure to pay an amount due pursuant to Section 4.08 hereof after such payment has become due and payable;

(iv)an “Event of Default” as such term is defined in Section 8.01 of the Agreement;

(v)prior to termination or expiration of a Credit Facility, receipt by the Trustee, prior to the date set forth in a Credit Facility for automatic reinstatement of interest following a drawing under a Credit Facility to pay accrued interest on the Bonds, of notice from the Bank in accordance with a Credit Facility that a Credit Facility will not be reinstated in respect of such interest;

(vi)prior to termination or expiration of a Credit Facility and payment in full of all amounts due under the Reimbursement Agreement, receipt by the Trustee of written notice from the Bank that an “Event of Default” under the Reimbursement Agreement has occurred and is continuing; or

(vii)a failure by the Issuer to observe and perform any covenant, condition, agreement or provision (other than as specified in clauses (i), (ii) and (iii) of paragraph (a) of this Section 10.01) contained in the Bonds or in this Indenture on the part of the Issuer to be observed or performed, which failure shall continue for a period of 60 days after written notice, specifying such failure and requesting that it be remedied, shall have been given to the Issuer and the Borrower by the Trustee, which may give such notice in its discretion and shall give such notice at the written request of the Owners of a majority in principal amount of the Bonds then Outstanding, unless the Trustee or the Owners of Bonds then Outstanding in principal amount not less than the principal amount of Bonds the Owners of which requested such notice, as the case may be, shall agree in writing to an extension of such period prior to its expiration; provided, however, that the Trustee, or the Trustee and the Owners of such principal amount of Bonds, as the case may be, shall be deemed to have agreed to an extension of such period if corrective action is initiated by the Issuer, or the Borrower on behalf of the Issuer, within such period and is being diligently pursued.

(b)If
(i)(A) a Credit Facility is then in effect and (B) an Event of Default described in clause (i), (ii) or (iii) of paragraph (a) of this Section 10.01 shall occur and

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be continuing, the Trustee may, and at the written request of the owners of a majority in principal amount of Bonds then Outstanding, the Trustee shall, or

(ii)(A) a Credit Facility is then in effect and (B) an Event of Default described in clause (iv) of paragraph (a) of this Section 10.01 shall occur and be continuing, at the written request of the Bank, the Trustee shall, or

(iii)(A) a Credit Facility is then in effect and (B) an Event of Default described in clause (v) or (vi) of paragraph (a) of this Section 10.01 shall occur and be continuing, the Trustee shall, or
(iv)(A) a Credit Facility is not then in effect or if the Bank shall have wrongfully failed to honor a drawing under such Credit Facility then in effect and (B) an Event of Default described in clause (i), (ii), (iii), (iv), (v), or (vi) of paragraph (a) of this Section 10.01 shall occur and be continuing, the Trustee may, and at the written request of the Owners of a majority in principal amount of Bonds then Outstanding, the Trustee shall by written notice to the Issuer, the Bank, and the Borrower, declare the Bonds to be immediately due and payable, whereupon they shall, without further action, become and be immediately due and payable, anything in this Indenture or in the Bonds to the contrary notwithstanding, and the Trustee shall give notice thereof to the Tender Agent, the Remarketing Agent and the Owners and shall immediately (and in no event later than five (5) days thereafter) draw under a Credit Facility to the extent provided in Section 5.04 hereof.  If the principal of all of the Bonds shall have been declared due and payable while a Credit Facility shall be in effect, interest on such Bonds shall cease to accrue on the date of the drawing on a Credit Facility with respect to such declaration.  The Trustee shall not be entitled to accelerate the principal of the Bonds upon the occurrence of an Event of Default described in clause (vii) of paragraph (a) of this Section 10.01.

(c)The provisions of paragraph (b)(iv), however, are subject, when no Credit Facility shall be in effect, to the condition that if, after the principal of the Bonds shall have been so declared to be due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the Issuer shall cause to be deposited with the Trustee a sum sufficient to pay all matured installments of interest upon all Bonds, premium, if any, and the principal of any and all Bonds which shall have become due otherwise than by reason of such declaration (with interest upon such principal and, to the extent permissible by law, on overdue installments of interest, at the rate per annum borne by the Bonds on the date of such declaration) and such amounts as shall be sufficient to cover reasonable compensation and reimbursement of expenses payable to the Trustee, and all Events of Default hereunder other than nonpayment of the principal of Bonds which shall have become due by said declaration shall have been remedied or waived, then, in every such case, such Event of Default shall be deemed waived and such declaration and its consequences rescinded and annulled, and the Trustee shall promptly give written or Electronic notice of such waiver, rescission and annulment to the Issuer, the Borrower, the Remarketing Agent, and, if notice of the acceleration of the Bonds shall have been given to the Owners, shall give notice thereof to the Owners; but no such waiver, rescission and annulment shall extend to or affect any subsequent Event of Default or impair any right or remedy consequent thereon.

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(d)The provisions of paragraph (b) are, further, subject to the condition that (i) if an Event of Default described in clauses (v) or (vi) of paragraph (a) shall have occurred and the Trustee shall thereafter have received written notice from the Bank that the notice of the Bank which caused the occurrence of such Event of Default shall have been withdrawn and (ii) if any drawing under a Credit Facility shall have been made and a Credit Facility shall have been reinstated as to principal to an amount equal to the outstanding principal amount of the Bonds and as to interest to an amount which at least equals, depending on the type of Interest Rate Period then in effect, the coverage required by Section 2.01(c)(vi) hereof to permit such Interest Rate Period to go into effect, and the Trustee shall have received written notice from the Bank of such reinstatement, then such Event of Default shall be waived, and the consequences of such Event of Default rescinded and annulled and the Trustee shall promptly give written notice of such waiver, rescission and annulment to the Issuer, the Borrower, the Bank, the Tender Agent, the Remarketing Agent, and, if notice of the acceleration of the Bonds shall have been given to the Owners, shall give notice thereof to the Owners; but no such waiver, rescission and annulment shall extend to or affect any subsequent Event of Default or impair any right or remedy consequent thereon.

Section 10.02Remedies.  In addition to the rights conferred, or obligation imposed, upon the Trustee under Section 10.01 hereof to accelerate the principal of the Bonds upon the occurrence and continuance of any Event of Default, then and in every such case the Trustee in its discretion may, and upon the written request of the Bank or the Owners of a majority in principal amount of the Bonds then Outstanding and receipt of indemnity to its satisfaction shall, in its own name and as the Trustee of an express trust:

(i)by mandamus, or other suit, action or proceeding at law or in equity, enforce all rights of the Owners of the Bonds, and require the Issuer, the Bank and the Borrower to carry out any agreements with or for the benefit of the Owners and to perform their duties under the Act, the Agreement, a Credit Facility and this Indenture;

(ii)bring suit upon the Bonds or a Credit Facility; or

(iii)by action or suit in equity enjoin any acts or things which may be unlawful or in violation of the rights of the Owners of the Bonds.

Section 10.03Restoration to Former Position.  In the event that any proceeding taken by the Trustee to enforce any right under this Indenture shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee, then and in every case the Issuer, the Trustee and the Owners of the Bonds shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies and powers of the Trustee shall continue as though no such proceeding had been taken.

Section 10.04Reserved.

Section 10.05Limitation on Owners' Right to Institute Proceedings.  No owner shall have any right to institute any suit, action or proceedings in equity or at law for the execution of any trust or power hereunder, or any other remedy hereunder or on said Bonds, unless (i) such Owner previously shall have given to the Trustee written notice of an Event of Default as

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hereinabove provided, (ii) the owners of a majority in principal amount of the Bonds then Outstanding shall have made written request of the Trustee so to do, after the right to institute said suit, action or proceeding shall have accrued, and shall have afforded the Trustee a reasonable opportunity to proceed to institute the same in either its or their name, (iii) there also shall have been offered to the Trustee security and indemnity satisfactory to it against the costs, expenses and liabilities to be incurred therein or thereby, and (iv) the Trustee shall not have complied with such request within a reasonable time after such notice, request and offer of indemnity; and such notification, request and offer of indemnity are hereby declared in every such case, at the option of the Trustee, to be conditions precedent to the institution of said suit, action or proceeding; it being understood and intended that no one or more of the Owners shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Indenture, or to enforce any right hereunder or under the Bonds, except in the manner herein provided, and that all suits, actions and proceedings at law or in equity shall be instituted, had and maintained in the manner herein provided and for the equal benefit of all Owners.

Section 10.06No Impairment of Right to Enforce Payment.  Notwithstanding any other provision in this Indenture, the right of any Owner to receive payment of the principal of and interest and any premium on such Bond, on or after the respective due dates expressed therein or applicable redemption dates, or to institute suit for the enforcement of any such payment on or after such respective date, shall not be impaired or affected without the consent of such Owner.

Section 10.07Proceeding by Trustee Without Possession of Bonds.  All rights of action under this Indenture or under any of the Bonds secured hereby which are enforceable by the Trustee may be enforced by it without the possession of any of the Bonds or the production thereof at the trial or other proceedings relative thereto.  Any such suit, action or proceeding instituted by the Trustee shall be brought in its name for the equal and ratable benefit of the Owners subject to the provisions of this Indenture.

Section 10.08No Remedy Exclusive.  No remedy herein conferred upon or reserved to the Trustee, the Bank or to the Owners of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder or under the Agreement, or now or hereafter existing at law or in equity or by statute.

Section 10.09No Waiver of Remedies.  No delay or omission of the Trustee, the Bank or of any Owner of a Bond to exercise any right or power accruing upon any default shall impair any such right or power accruing upon any default or shall be construed to be a waiver of any such default, or an acquiescence therein.  Every power and remedy given by this Article X to the Trustee, the Bank and to the Owners of the Bonds, respectively, may be exercised from time to time as often as may be deemed expedient.

Section 10.10Application of Moneys.  Any moneys received by the Trustee, by any receiver or by any Owner of a Bond pursuant to any right given or action taken under the provisions of this Article X or under the provisions of the Agreement after payment of the costs and expenses of the proceedings resulting in the collection of such moneys, including any amounts due to the Trustee pursuant to Section 11.04 hereof and under the Agreement (except 

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that proceeds of a drawing under a Credit Facility and any moneys held pursuant to Section 5.06 hereof may not be so used), shall be deposited in the Bond Fund and all moneys so deposited in the Bond Fund during the continuance of an Event of Default (other than moneys for the payment of Bonds which had matured or otherwise become payable prior to such Event of Default or for the payment of interest due prior to such Event of Default) shall be applied as follows:

(a)Unless the principal of all the Bonds shall have been declared due and payable, all such moneys shall be applied (i) first, to the payment to the persons entitled thereto of all installments of interest then due on the Bonds, with interest on overdue installments, if lawful, at the rate per annum borne by the Bonds on the date of occurrence of such Event of Default, in the order of maturity of the installments of such interest and, if the amount available shall not be sufficient to pay in full any particular installment of interest, then to the payment ratably, according to the amounts due on such installment, and (ii) second, to the payment to the persons entitled thereto of the unpaid principal of and any premium on any of the Bonds which shall have become due (other than Bonds called for redemption for the payment of which money is held pursuant to the provisions of this Indenture) with interest on such Bonds at their rate on the date of occurrence of such Event of Default from the respective dates upon which they became due and, if the amount available shall not be sufficient to pay in full Bonds due on any particular date, together with such interest, then to the payment ratably, according to the amount of principal and interest and any premium due on such date, in each case to the persons entitled thereto, without any discrimination or privilege; provided, however, that moneys derived from the exercise of rights by the Trustee under a Credit Facility shall not be applied to the payment of the principal of or premium or interest on Bonds held of record by the Borrower or any affiliate thereof or by the Tender Agent for the account of the Borrower.

(b)If the principal of all the Bonds shall have been declared due and payable, all such moneys shall be applied to the payment of the principal and interest then due and unpaid upon the Bonds, with interest on overdue interest and principal, as aforesaid, without preference or priority of principal over interest or of interest over principal, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond, ratably, according to the amounts due respectively for principal and interest, to the persons entitled thereto without any discrimination or privilege; provided however, that moneys derived from the exercise of rights by the Trustee under a Credit Facility shall not be applied to the payment of the principal of or premium or interest on Bonds held of record by the Borrower or any affiliate thereof or by the Tender Agent for the account of the Borrower.

(c)If the principal of all the Bonds shall have been declared due and payable, and if such declaration shall thereafter have been rescinded and annulled under the provisions of this Article X, subject to the provisions of clause (b) of this Section 10.10 which shall be applicable in the event that the principal of all the Bonds shall later become due and payable, the moneys shall be applied in accordance with the provisions of clause (a) of this Section 10.10.

Whenever moneys are to be applied pursuant to the provisions of this Section 10.10, such moneys shall be applied at such times, and from time to time, as the Trustee shall determine, having due regard to the amount of such moneys available for application and the likelihood of additional moneys becoming available for such application in the future.  Whenever the Trustee

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shall apply such funds, it shall fix the date (which, while a Credit Facility shall be in effect, shall be within five days of any declaration of acceleration and, if possible, an Interest Payment Date unless it shall deem another date more suitable) upon which such application is to be made and, upon such application, interest on the amounts of principal, premium and interest to be paid on such dates shall cease to accrue, except that if the principal of all of the Bonds shall have been declared due and payable when a Credit Facility shall be in effect, interest on such amounts shall cease to accrue on the date of the drawing on a Credit Facility with respect to such declaration.  The Trustee shall give notice of the deposit with it of any such moneys and of the fixing of any such date to all Owners of Outstanding Bonds, consistent with the requirements of Section 2.01 hereof for the establishment of, and giving of notice with respect to, a Special Record Date for the payment of overdue interest.  The Trustee shall not be required to make payment to any Owner of a Bond until such Bond shall be presented to the Trustee for appropriate endorsement or for cancellation if fully paid.
Notwithstanding anything in this Section 10.10 to the contrary, moneys received by the Trustee pursuant to draws on a Credit Facility, and moneys held by the Trustee pursuant to Section 4.10 for the payment of Bonds not presented for payment, shall be applied only to the payment of principal, redemption premium (if any) and interest due on the Bonds.
Section 10.11Severability of Remedies.  It is the purpose and intention of this Article X to provide rights and remedies to the Trustee, the Bank and the Owners which may be lawfully granted under the provisions of the Act, but should any right or remedy granted herein be held to be unlawful, the Trustee, the Bank and the Owners shall be entitled, as above set forth, to every other right and remedy provided in this Indenture and by law.

Section 10.12Waivers of Events of Default.  The Trustee in its discretion may waive any Event of Default hereunder (other than an Event of Default described in clauses (v) and (vi) of paragraph (a) of Section 10.01 and not waived in accordance with paragraph (d) of Section 10.01) and its consequences and shall in any event do so upon the written request of the Owners of a majority in principal amount of all Bonds then outstanding; provided, however, that there shall not be waived

(i)any Event of Default pertaining to the payment of the principal of any Bond at the Maturity Date or redemption date prior to the Maturity Date, or

(ii)any Event of Default pertaining to the payment when due of the interest on any Bond,

unless, prior to such waiver (A) all arrears of principal (due otherwise than by declaration) and interest, with interest (to the extent permitted by law) at the rate per annum borne by the Bonds in respect of which such Event of Default shall have occurred on overdue installments of principal (due otherwise than by declaration) and interest, shall have been paid or provided for, and (B) all expenses of the Trustee in connection with such Event of Default shall have been paid or provided for to the satisfaction of the Trustee, and provided further that, in case of any such waiver, or in case any proceeding taken by the Trustee on account of any such Event of Default shall be discontinued or abandoned or determined adversely, then and in every such case the Issuer, the Borrower, the Trustee, the Bank and the Owners of the Bonds shall be restored to

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their former positions and rights hereunder, respectively, but no such waiver shall extend to any subsequent or other Event of Default, or impair any right consequent thereon.  The Trustee shall not have any discretion to waive any Event of Default hereunder and its consequences except in the manner and subject to the terms expressed above.
Section 10.13No Obligation of Issuer to Act.  Subject to Sections 8.04 and 8.05, the Issuer shall have no obligation to take any action or pursue any right or remedy of the Trustee or any Owner under this Indenture or otherwise, including, but not limited to, taking any action in a bankruptcy proceeding.

ARTICLE XI

TRUSTEE, PAYING AGENT, REGISTRAR

Section 11.01Aceptance of Trusts.  By executing the certificate of authentication endorsed upon the Bonds, the Trustee shall signify its acceptance and agree to execute the trusts hereby created but only upon the additional terms set forth in this Article XI, to all of which the Issuer agrees and the respective owners agree by their acceptance of delivery of any of the Bonds.

To the extent that it is necessary for the Trustee to determine whether any Person is a Beneficial Owner, the Trustee shall make such determination based on a certification of such Person (on which the Trustee may conclusively rely) setting forth in satisfactory detail the principal balance and bond certificate owned and any intermediaries through which such bond certificate is held.  The Trustee shall be entitled to rely conclusively on information it receives from DTC or other applicable Securities Depository, its direct participants and the indirect participating brokerage firms for such participants with respect to the identity of a Beneficial Owner.  The Trustee shall not be deemed to have actual or constructive knowledge of the books and records of DTC or its participants.
Section 11.02Trustee Not Responsible for Recitals, Maintenance, Insurance, etc. The recitals, findings and representations in this Indenture or in the Bonds contained, save only the Trustee's authentication upon the Bonds, shall be taken and construed as made by and on the part of the Issuer, and not by the Trustee, and the Trustee does not assume, and shall not have, any responsibility or obligation for the correctness of any thereof.  In addition, the Trustee shall not have any responsibility for monitoring the Borrower's obligations under Sections 5.05 and 5.06 of the Agreement to maintain the Facilities or to maintain or cause to be maintained the insurance required thereunder.

Section 11.03Limitations on Liability.

(a)The Trustee may execute any of the trusts or powers hereof and perform the duties required of it hereunder by or through attorneys, agents, receivers or employees, and shall be entitled to advice of counsel concerning all matters of trust and its duty hereunder and shall not be liable for any action taken or omitted to be taken in good faith on the basis of such advice, and the Trustee shall not be answerable for the default or misconduct of any such attorney, agent or employee selected by it with reasonable care.  The Trustee shall not be 

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answerable for the exercise of any discretion or power under this Indenture or for anything whatsoever in connection with the trust created hereby, except only for its own gross negligence or willful misconduct.

(b)The permissive rights of the Trustee to do things enumerated in this Indenture shall not be construed as a duty, and the Trustee shall not be liable for any action reasonably taken or omitted to be taken by it in good faith and reasonably believed by it to be within its discretion or power conferred upon it hereby.

(c)Whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder or under the Agreement, the Trustee may, in the absence of bad faith on its part, rely upon a Certificate of the Borrower.

(d)Prior to taking any action under the Agreement or this Indenture, the Trustee shall be entitled to a certificate of an Authorized Borrower Representative and/or an opinion of counsel with respect to the proposed action, which certificate and/or opinion shall confirm that all conditions precedent, if any, have been satisfied.

(e)The Trustee shall not be required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture.  No provision of the Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers.

(f)The Trustee shall not be bound to ascertain or inquire as to performance or observance of any covenants, conditions or other agreements on the part of the Borrower or the Issuer under the Agreement or this Indenture, as the case may be, except as specifically provided for herein.  The Trustee shall have no obligation to perform any of the duties of the Issuer or the Borrower under the Agreement or this Indenture.

Section 11.04Compensation, Expenses and Advances.  The Trustee, the Paying Agent, the Registrar and the Tender Agent under this Indenture shall be entitled to reasonable compensation for their services rendered hereunder including extraordinary services such as default administration (not limited by any provision of law in regard to the compensation of the trustee of an express trust) and to reimbursement for their actual out-of-pocket expenses (including counsel fees and expenses) reasonably incurred in connection therewith except as a result of their gross negligence or willful misconduct.  If the Issuer shall fail to perform any of the covenants or agreements contained in this Indenture, other than the covenants or agreements in respect of the payment of the principal of, premium, if any, and interest on the Bonds, the Trustee may, in its uncontrolled discretion and without notice to the Owners of the Bonds, at any time and from time to time, make advances to effect performance of the same on behalf of the Issuer, but the Trustee shall be under no obligation to do so; but no such advance shall operate to relieve the Issuer from any default hereunder.  In Section 5.04 of the Agreement, the Borrower has agreed that it will pay to the Trustee, the Paying Agent, the Registrar, the Remarketing Agent and the Tender Agent such compensation and reimbursement of expenses and advances, but the Borrower may, without creating a default hereunder, contest in good faith the reasonableness of

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any such services, expenses and advances.  In Section 5.07 of the Agreement, the Borrower has agreed to indemnify the Trustee and the Registrar to the extent stated therein.  If the Borrower shall have failed to make any payment to the Trustee under Sections 5.04 or 5.07 of the Agreement and such failure shall have resulted in an Event of Default under the Agreement, the Trustee shall have, in addition to any other rights hereunder, a claim, prior to the claim of the Owners of the Bonds, for the payment of its compensation and the reimbursement of its expenses and any advances made by it, as provided in this Section 11.04, upon the moneys and obligations in the Bond Fund, except for proceeds of drawings under a Credit Facility and except for moneys which are deemed to have been paid in accordance with Article IX hereof and funds held pursuant to Section 5.06 hereof.

Section 11.05Notice of Events of Default.  The Trustee shall not be required to take notice, or be deemed to have notice, of any default or Event of Default under this Indenture or the Agreement other than an Event of Default under clauses (i), (ii), (iii) (but only if the Trustee and the Tender Agent are the same entity), (v) or (vi) of paragraph (a) of Section 10.01 hereof, unless specifically notified in writing of such default or Event of Default by Owners of at least a majority in principal amount of the Bonds then Outstanding or by the Bank.  The Trustee may, however, at any time, in its discretion, require of the Issuer full information and advice as to the performance of any of the covenants, conditions and agreements contained herein.

Section 11.06Action by Trustee.  The Trustee shall be under no obligation to take any action in respect of any default or Event of Default hereunder other than pursuant to Section 10.01(b) hereof, or toward the execution or enforcement of any of the trusts hereby created, or to institute, appear in or defend any suit or other proceeding in connection therewith, unless requested in writing to do so by Owners of at least a majority in principal amount of the Bonds then Outstanding or the Bank, and, if in its opinion such action may tend to involve it in expense or liability, unless furnished, from time to time as often as it may require, with security and indemnity satisfactory to it.  The foregoing provisions are intended only for the protection of the Trustee, and shall not affect any discretion or power given by any provisions of this Indenture to the Trustee to take action in respect of any default or Event of Default without such notice or request from Owners or the Bank, or without such security or indemnity.  Notwithstanding the foregoing, the Trustee shall submit draw requests under a Credit Facility as provided therein, make payments on the Bonds in accordance with this Indenture and give notice of acceleration in accordance with Section 10.01(b) hereof, without as a precondition to such action, demanding security and indemnity as hereinbefore provided.

Section 11.07Good Faith Reliance.  The Trustee shall be protected and shall incur no liability in acting or proceeding in good faith upon any resolution, notice, telegram, request, consent, waiver, certificate, statement, affidavit, voucher, bond, requisition or other paper or document, or upon telephonic instructions to the extent the giving of telephonic instructions is specifically authorized by this Indenture or the Agreement, in any case which the Trustee shall in good faith believe to be genuine and to have been passed, signed or given by the proper board, body or person or to have been prepared and furnished pursuant to any of the provisions of this Indenture or the Agreement, or upon the written opinion of any attorney, engineer, accountant or other expert believed by the Trustee to be qualified in relation to the subject matter, and the Trustee shall be under no duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument, but may accept and rely upon the same

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as conclusive evidence of the truth and accuracy of such statements.  Neither the Trustee, the Paying Agent, the Registrar nor the Tender Agent shall be bound to recognize any person as an Owner or to take any action at his request unless his Bond shall be deposited with such entity or satisfactory evidence of the ownership of such Bond shall be furnished to such entity.

Section 11.08Dealings in Bonds and with the Issuer and the Borrower.  The Trustee, the Paying Agent, the Registrar, the Bank, the Tender Agent or the Remarketing Agent and each of their officers and directors, may in good faith buy, sell, own, hold and deal in any of the Bonds, and may join in any action which any Owner may be entitled to take with like effect as if it did not act in any capacity hereunder.  The Trustee, the Paying Agent, the Registrar, the Bank, the Tender Agent or the Remarketing Agent, in its individual capacity, either as principal or agent, may also engage in or be interested in any financial or other transaction with the Issuer or the Borrower, and may act as depositary, trustee or agent for any committee or body of Owners or other obligations of the Issuer as freely as if it did not act in any capacity hereunder.

Section 11.09Several Capacities.  Anything in this Indenture to the contrary notwithstanding, the same entity may serve hereunder as the Trustee, the Paying Agent, the Registrar, the Tender Agent and the Remarketing Agent and in any other combination of such capacities, to the extent permitted by law.

Section 11.10Construction of Indenture.  The Trustee may construe any of the provisions of this Indenture or the Agreement insofar as the same may appear to be ambiguous or inconsistent with any other provision hereof or thereof, and any construction of any such provisions hereof by the Trustee in good faith shall be binding upon the Owners, the Issuer and the Borrower.

Section 11.11Resignation of Trustee.  The Trustee may resign and be discharged of the trusts created by this Indenture by executing an instrument in writing resigning such trust and specifying the date when such resignation shall take effect, and the Trustee shall provide such notice to the Issuer, the Borrower, the Bank, if any, and the Trustee shall give such notice of such resignation to all Owners.  Such notice shall specify the date when such resignation shall take effect.  Such resignation shall only take effect on the day a successor Trustee shall have been appointed as hereinafter provided and shall have accepted such appointment and agreed to assume all of the obligations as Trustee hereunder.

Section 11.12Removal of Trustee.  The Trustee may be removed by the Issuer at any time, at the written request of the Borrower (other than during the continuation of an Event of Default) or the Owners of not less than a majority in principal amount of the Bonds then Outstanding, by filing with the Trustee so removed, the Issuer, the Borrower, the Tender Agent, the Remarketing Agent and the Bank an instrument or instruments in writing appointing a successor in accordance with Section 11.13 hereof.  Promptly upon delivery of such instrument or instruments to the Trustee, the successor Trustee upon its acceptance of the trusts created hereby shall give notice thereof to all Owners.

Section 11.13Appointment of Successor Trustee.  If at any time the Trustee shall be removed, be dissolved or its property or affairs shall be taken under the control of any state or federal court or administrative body because of insolvency, bankruptcy or any other reason, a 

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vacancy shall ipso facto be deemed to exist in the office of Trustee and a successor may be appointed, and in case at any time the Trustee shall resign, then a successor may be appointed, by giving written notice to the Issuer, the Borrower, the Tender Agent, the Remarketing Agent and the Bank an instrument of appointment in writing, executed by Owners of not less than a majority in principal amount of Bonds then Outstanding with the consent of the Bank unless the Bank has wrongfully dishonored a draw on a Credit Facility.  Copies of such instrument shall be promptly delivered by the Issuer to the predecessor Trustee and to the Trustee so appointed.

Until a successor Trustee shall be appointed by the Owners of the Bonds as herein authorized with the consent of the Bank unless the Bank has wrongfully dishonored a draw on a Credit Facility, the Issuer, by an instrument authorized by resolution of the Issuer, may, but shall have no obligation to, appoint a successor Trustee acceptable to the Borrower and the Bank.  After any appointment by the Issuer, it shall cause notice of such appointment to be given to the Remarketing Agent and to all Owners of the Bonds.  Any new Trustee so appointed by the Issuer shall immediately and without further act be superseded by a Trustee appointed by the Owners of the Bonds in the manner above provided.  Notwithstanding anything herein to the contrary, no resignation or removal of the Trustee shall be effective until (i) a successor Trustee shall be appointed in accordance with the terms hereof and has accepted such appointment, and (ii) each then existing Letter of Credit or other Credit Facility shall have been transferred to such successor in accordance with the terms thereof.
Section 11.14Qualifications of Successor Trustee.  Every successor Trustee (a) shall be a bank or trust company (other than the Bank) duly organized under the laws of the United States or any state or territory thereof and authorized by law to perform all the duties imposed upon it by this Indenture, (b) shall have a combined capital stock, surplus and undivided profits of at least $50,000,000 if there can be located, with reasonable effort, such an institution willing and able to accept the trust on reasonable and customary terms and (c) shall have its obligations rated or be a wholly-owned subsidiary of an entity whose obligations are rated, so long as the Bonds shall be rated by Moody's, at least Baa3/P-3 by Moody's or otherwise qualified by Moody's.

Section 11.15Judicial Appointment of Successor Trustee.  If at any time the Trustee shall resign and no appointment of a successor Trustee shall be made pursuant to the foregoing provisions of this Article XI prior to the date specified in the notice of resignation as the date when such resignation is to take effect, the retiring Trustee may forthwith apply to a court of competent jurisdiction for the appointment of a successor Trustee.  If no appointment of a successor Trustee shall be made pursuant to the foregoing provisions of this Article XI within six months after a vacancy shall have occurred in the office of Trustee, any Owner of a Bond or the Bank may apply to any court of competent jurisdiction to appoint a successor Trustee.  Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a successor Trustee.

Section 11.16Acceptance of Trusts by Successor Trustee.  Any successor Trustee appointed hereunder shall execute, acknowledge and deliver to the Issuer, the Borrower, the Bank, if any, and to its predecessor Trustee an instrument accepting such appointment hereunder, and thereupon such successor Trustee, without any further act, deed or conveyance, shall become duly vested with all the estates, property, rights, powers, trusts, duties and obligations of its predecessor in the trust hereunder, with like effect as if originally named Trustee herein.  Upon 

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request of such successor Trustee, such predecessor Trustee and the Issuer shall execute and deliver an instrument transferring to such successor Trustee all the estates, property, rights, powers and trusts hereunder of such predecessor Trustee and, subject to the provisions of Section 11.04 hereof and upon payment of its charges, such predecessor Trustee shall (i) pay over to the successor Trustee all moneys and other assets at the time held by it hereunder and (ii) transfer over to the successor Trustee its interest in any Credit Facility.

Section 11.17Successor by Merger or Consolidation.  Any corporation into which any Trustee hereunder may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger or consolidation to which any Trustee hereunder shall be a party or any corporation to which all or substantially all of the corporate trust business of the Trustee shall be sold or transferred, shall be the successor Trustee under this Indenture, without the execution or filing of any paper or any further act on the part of the parties hereto, anything in this Indenture to the contrary notwithstanding.

Section 11.18Standard of Care.  Notwithstanding any other provisions of this Article XI, the Trustee shall, during the existence of an Event of Default of which the Trustee is required to take notice or is deemed to have notice under Section 11.05 hereof, exercise such of the rights and powers vested in it by this Indenture and use the same degree of skill and care in their exercise as a prudent indenture trustee would use and exercise under the circumstances.  Prior to the existence and after the curing or waiving of any such Event of Default, the duties of the Trustee hereunder shall be only such duties as are specifically set forth herein and no implied covenants shall be read into this Indenture or the Agreement against the Trustee.

Section 11.19Notice of Event of Default.  If an Event of Default occurs of which the Trustee is required by Section 11.05 hereof to take notice or has notice, or any other Event of Default occurs of which the Trustee has been specifically notified in accordance with Section 11.05 hereof, then (a) immediately upon the Trustee taking or having notice of any Event of Default under Section 10.1(a)(i),(ii) or (iii) or Section 10.01(b) upon any other Event of Default continuing for at least five Business Days after the Trustee is required to take, or has received, notice thereof, the Trustee shall give notice thereof to the Issuer, the Remarketing Agent, the Tender Agent, the Bank and the Owners of the Bonds.

Section 11.20Intervention in Litigation.  In any judicial proceeding to which the Issuer is a party and which in the opinion of the Trustee and its counsel has a substantial bearing on the interests of the Owners of the Bonds, the Trustee may intervene on behalf of the Owners of the Bonds and shall, upon receipt of indemnity satisfactory to it, do so if requested in writing by Owners of at least a majority in principal amount of the Bonds then Outstanding if permitted by the court having jurisdiction in the premises.

Section 11.21Paying Agent.  The Issuer may at any time or from time to time by resolution, with the approval of the Trustee and the Borrower, appoint the Paying Agent for the Bonds, subject to the conditions set forth in Section 11.22 hereof.  The Trustee is hereby appointed as the initial Paying Agent.  Each Paying Agent (if not also the Trustee) shall designate to the Trustee and the Bank its Principal Office and signify its acceptance of the duties and obligations imposed upon it hereunder by a written instrument of acceptance delivered to the Issuer, the Borrower and the Trustee under which such Paying Agent will agree, particularly:

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(i)to hold all sums held by it for the payment of the principal of and interest and any premium on Bonds in trust for the benefit of the Owners until such sums shall be paid to the Owners or otherwise disposed of as herein provided; and

(ii)to keep such books and records as shall be consistent with prudent industry practice and to make such books and records available for inspection by the Issuer, the Trustee and the Borrower at all reasonable times.

The Issuer shall cooperate with the Trustee and the Borrower to cause the necessary arrangements to be made and to be thereafter continued whereby funds will be made available for the payment when due of the Bonds as presented at the Principal Office of the Paying Agent.

Section 11.22Qualifications of Paying Agent; Resignation; Removal.  The Paying Agent shall (i) be a bank, a trust company, national banking association or another corporation duly organized under the laws of the United States of America or any state or territory thereof, (ii) have its obligations rated or be a wholly-owned subsidiary of an entity whose obligations are rated, so long as the Bonds are rated by Moody's, at least Baa3/P-3 by Moody's or otherwise qualified by Moody's, and (iii) be authorized by law to perform all the duties imposed upon it by this Indenture.  The Paying Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least 60 days' notice to the Issuer, the Borrower and the Trustee (if no longer the Paying Agent).  The Paying Agent shall be removed at any time, other than during the continuance of an Event of Default, at the direction of the Borrower, by an instrument, signed by the Issuer, filed with the Paying Agent and with the Trustee.

In the event of the resignation or removal of the Paying Agent, the Paying Agent shall pay over, assign and deliver any moneys held by it in such capacity to its successor or, if there be no successor, to the Trustee.
In the event that the Paying Agent shall resign, be removed or be dissolved, or if the property or affairs of the Paying Agent shall be taken under the control of any state or federal court or administrative body because of bankruptcy, insolvency or any other reason, and the Issuer shall not have appointed its successor as Paying Agent, the Trustee shall de facto be deemed to be the Paying Agent for all purposes of this Indenture until the appointment by the Issuer of the Paying Agent or successor Paying Agent, as the case may be.
Section 11.23Registrar.  The Trustee hereby is appointed as the initial Registrar.  In the event of the resignation or removal of the Registrar, the Issuer shall, at the direction of the Borrower, appoint the Registrar for the Bonds, subject to the conditions set forth in Section 11.24 hereof.  Each Registrar (if not also the Trustee) shall designate to the Trustee its Principal Office and signify its acceptance of the duties imposed upon it hereunder by a written instrument of acceptance delivered to the Issuer, the Borrower and the Trustee under which such Registrar will agree, particularly, to keep such books and records as shall be consistent with prudent industry practice and to make such books and records available for inspection by the Issuer, the Trustee and the Borrower at all reasonable times.

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The Issuer shall cooperate with the efforts of the Trustee and the Borrower intended to cause the necessary arrangements to be made and to be thereafter continued whereby Bonds, executed by the Issuer and authenticated by the Trustee, shall be made available for exchange and registration of transfer at the Principal Office of the Registrar.  The Issuer shall cooperate with the efforts of the Trustee, the Registrar and the Borrower to cause the necessary arrangements to be made and thereafter continued whereby the Paying Agent and the Remarketing Agent shall be furnished such records and other information, at such times, as shall be required to enable the Paying Agent and the Remarketing Agent to perform the duties and obligations imposed upon them hereunder.
Section 11.24Qualifications of Registrar; Resignation; Removal.  The Registrar shall be a corporation duly organized under the laws of the United States of America or any state or territory thereof, authorized by law to perform all the duties imposed upon it by this Indenture.  The Registrar may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least 60 days' notice to the Issuer, the Trustee and the Borrower.  The Registrar may be removed at any time, at the direction of the Borrower (other than during the continuance of an Event of Default), by an instrument, signed by the Issuer, filed with the Registrar and the Trustee.

In the event of the resignation or removal of the Registrar, the Registrar shall deliver any Bonds held by it in such capacity to its successor or, if there be no successor, to the Trustee.
In the event that the Registrar shall resign, be removed or be dissolved, or if the property or affairs of the Registrar shall be taken under the control of any state or federal court or administrative body because of bankruptcy, insolvency or any other reason, and the Issuer shall not have appointed its successor as Registrar, the Trustee shall de facto be deemed to be the Registrar for all purposes of this Indenture until the appointment by the Issuer of the Registrar or successor Registrar, as the case may be.
Section 11.25Appointment of Co-Trustee.  It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction (including particularly the law of the State of Arizona) denying or restricting the right of banking corporations or associations to transact business as trustee in such jurisdiction.  It is recognized that in case of litigation under this Indenture or the Agreement, and in particular in the case of the enforcement thereof on default, or in the case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to the Trustee or hold title to the properties, in trust, as herein granted, or take any action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an additional individual or institution as a separate or co-trustee.

In the event that the Trustee shall appoint an additional individual or institution as a separate or co-trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate or co-trustee, but only to the extent necessary to enable such separate or co-trustee to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-trustee shall run to and be enforceable by either of them.

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Should any reasonable instrument in writing from the Issuer be required by the separate or co-trustee so appointed by the Trustee for more fully and certainly vesting in and confirming to him or it such estates, property, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Issuer.  In case any separate or co-trustee or a successor to either shall die, become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a successor to such separate or co-trustee or a new separate or co-trustee.  No trustee hereunder shall be liable by reason of any act or omission of any other trustee hereunder.
Section 11.26Notices to Rating Agencies.  The Trustee shall provide Moody's, if the Bonds are then rated by Moody's, or S&P, if the Bonds are then rated by S&P as appropriate, with prompt written notice at least 15 days prior to its execution and adoption of (i) the appointment of any successor Trustee, Paying Agent, Remarketing Agent or Tender Agent, (ii) any amendments to this Indenture or the Agreement, (iii) the payment (or provision for payment) in whole of the Bonds, (iv) the adjustment of any Bonds to a Short-Term or Long-Term Interest Rate Period, (v) the acquisition, extension, expiration or termination of a Credit Facility, or (vi) any amendment to the Reimbursement Agreement or a Credit Facility of which the Trustee has actual knowledge.

ARTICLE XII

EXECUTION OF INSTRUMENTS BY 
OWNERS AND PROOF OF OWNERSHIP OF BONDS

Section 12.01Execution of Instruments Proof of Ownership.  Any request, direction, consent or other instrument in writing, whether or not required or permitted by this Indenture to be signed or executed by Owners of the Bonds, may be in any number of concurrent instruments of similar tenor and may be signed or executed by Owners of the Bonds in person or by agent appointed by an instrument in writing.  Proof of the execution of any such instrument and of the ownership or former ownership of Bonds shall be sufficient for any purpose of this Indenture and shall be conclusive in favor of the Trustee with regard to any action taken by it under such instrument if made in the following manner:

(i)The fact and date of the execution by any person of any such instrument may be proved by the certificate of any officer in any jurisdiction who, by the laws thereof, has power to take acknowledgments within such jurisdiction, to the effect that the person signing such instrument acknowledged before him the execution thereof, or by an affidavit of a witness to such execution, or in any other manner reasonably acceptable to the Trustee.

(ii)The ownership or former ownership of Bonds shall be proved by the registration books kept under the provisions of Section 2.04 hereof and the records kept by the Trustee pursuant to Section 6.02(c) hereof.

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(iii)While the Bonds are in book-entry only form, the beneficial ownership or former ownership of Bonds shall be proved by an instrument in writing signed by such Beneficial Owner and acceptable to the Trustee.

Nothing contained in this Article XII shall be construed as limiting the Trustee to such proof, it being intended that the Trustee may accept any other evidence of matters herein stated which it may deem to be sufficient.  Any request or consent of any Owner of a Bond shall bind every future Owner of any Bond or Bonds issued in lieu thereof or upon registration of transfer or in exchange thereof in respect of anything done by the Trustee or the Issuer in pursuance of such request or consent.

ARTICLE XIII

MODIFICATION OF INDENTURE DOCUMENTS

Section 13.01Limitations.  This Indenture and the Agreement shall not be modified or amended in any respect subsequent to the initial issuance of the Bonds, except as provided in and in accordance with and subject to the provisions of this Article XIII.

Section 13.02Modification without Consent of Owners.  The Issuer and the Trustee may, from time to time and at any time without the consent of or notice to the Owners of the Bonds, enter into Supplemental Indentures as follows:

(i)to cure any formal defect, omission, inconsistency or ambiguity in this Indenture;
(ii)to grant to or confer upon the Trustee for the benefit of the Owners of the Bonds any additional rights, remedies, powers, authority or security which may lawfully be granted or conferred and which are not contrary to or inconsistent with this Indenture as theretofore in effect;

(iii)to add to the covenants and agreements of, and limitations and restrictions upon, the Issuer in this Indenture other covenants, agreements, limitations and restrictions to be observed by the Issuer which are not contrary to or inconsistent with this Indenture as theretofore in effect;
(iv)to confirm, as further assurance, any pledge or assignment under, and the subjection to any claim, lien, pledge or assignment created or to be created by this Indenture, of the Receipts and Revenues or of any other moneys, securities or funds;

(v)to authorize different Authorized Denominations of the Bonds and to make correlative amendments and modifications to this Indenture regarding exchangeability of Bonds of different Authorized Denominations, redemptions of portions of Bonds of particular Authorized Denominations and similar amendments and modifications of a technical nature;

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(vi)to modify, alter, supplement or amend this Indenture in such manner as shall permit the qualification hereof under the Trust Indenture Act of 1939, as from time to time amended;

(vii)to increase or decrease the number of days specified in Section 2.01(c) hereof and to make corresponding changes to Section 4.03 hereof; provided that no decreases in any such number of days shall become effective except during a Daily Interest Rate Period or a Weekly Interest Rate Period and until 30 days after the Trustee shall have given notice to the Owners;

(viii)to provide for the procedures required to permit or implement an uncertificated system of registration of the Bonds;

(ix)to modify, alter, amend or supplement this Indenture in any other respect which is not materially adverse to the Owners and which does not involve a change described in the provisions of Section 13.03(i) hereof; and

(x)to modify, alter, supplement or amend this Indenture to comply with changes in the Code affecting the status of interest on the Bonds as excluded from gross income for federal income tax purposes or the obligations of the Issuer or the Borrower in respect of Section 148 of the Code.

Before the Issuer shall adopt any Supplemental Indenture pursuant to this Section 13.02, there shall have been provided to the Issuer and the Trustee a Favorable Opinion of Bond Counsel.
Section 13.03Modification with Consent of Owners.

(i)Except for any Supplemental Indenture entered into pursuant to Section 13.02 hereof, subject to the terms and provisions contained in this Section 13.03, the Owners of not less than a majority in aggregate principal amount of the Bonds shall have the right from time to time to consent to and approve the adoption by the Issuer of any Supplemental Indenture deemed necessary or desirable by the Issuer for the purposes of modifying, altering, amending, supplementing or rescinding, in any particular, any of the terms or provisions contained in this Indenture; provided, however, that, unless approved in writing by the Owners of all the Bonds, nothing herein contained shall permit, or be construed as permitting, (i) a change in the times, amounts or currency of payment of the principal of or interest or any premium on any Bond, a change in the terms of the purchase of Bonds pursuant to Section 4.08 hereof (other than as permitted by Section 13.02(vii) hereof), or a reduction in the principal amount or redemption price of any Bond or a change in the method of determining the rate of interest thereon, or (ii) the creation of a claim or lien upon, or a pledge or assignment of, the Receipts and Revenues ranking prior to or on a parity with the claim, lien, pledge or assignment created by this Indenture, or (iii) a preference or priority of any Bond or Bonds over any other Bond or Bonds, or (iv) a reduction in the aggregate principal amount of Bonds the consent of the Owners of which is required for any such Supplemental Indenture or under 

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Section 13.07 hereof, for any modification, alteration, amendment or supplement to the Agreement.

(ii)If at any time the Issuer shall determine to adopt any Supplemental Indenture for any of the purposes of this Section 13.03, the Trustee shall cause notice of the proposed Supplemental Indenture to be given to all Owners of the Bonds.  Such notice shall briefly set forth the nature of the proposed Supplemental Indenture and shall state that a copy thereof is on file at the Principal Office of the Trustee for inspection by all Owners of the Bonds.

(iii)Within two years after the date of the giving of such notice, the Issuer may adopt (the date of adoption shall be the date of passage and not the effective date) such Supplemental Indenture in substantially the form described in such notice, but only if there shall have first been filed with the Trustee (i) the required consents, in writing, of the Owners of the Bonds and (ii) a Favorable Opinion of Bond Counsel stating that such Supplemental Indenture is authorized or permitted by this Indenture and the Act, complies with their respective terms, and, upon the adoption thereof, will be valid and binding upon the Issuer in accordance with its terms and will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds.

(iv)If Owners of not less than the percentage of Bonds required by this Section 13.03 shall have consented to and approved the adoption thereof as herein provided, no Owner shall have any right to object to the adoption of such Supplemental Indenture, or to object to any of the terms and provisions contained therein or the operation thereof, or in any manner to question the propriety of the execution and delivery thereof, or to enjoin or restrain the Issuer from enacting the same or from taking any action pursuant to the provisions thereof.

Section 13.04Effect of Supplemental Indenture.  Upon the adoption of any Supplemental Indenture pursuant to the provisions of this Article XIII, this Indenture shall be, and be deemed to be, modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the Issuer, the Trustee and all Owners of Bonds then Outstanding shall thereafter be determined, exercised and enforced under this Indenture subject in all respects to such modifications and amendments.

Section 13.05Consent of the Borrower and the Bank.  Anything herein to the contrary notwithstanding, the Trustee (i) shall not execute any Supplemental Indenture under this Article XIII which affects any rights, powers and authority of the Borrower under the Agreement, the Tender Agreement or the applicable Credit Facility or requires a revision of the Agreement, the Tender Agreement or the applicable Credit Facility unless and until the Borrower, the Bank and the Tender Agent shall have consented to such Supplemental Indenture, and (ii) need not accept any Supplemental Indenture which affects its rights, duties and responsibilities hereunder or under the Agreement.

Section 13.06Amendment of Agreement without Consent of Owners.  Without the consent of or notice to the Owners of the Bonds but with the consent of the Borrower and the Bank, the Issuer may modify, alter, amend or supplement the Agreement, and the Trustee may 

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consent thereto, (a) as may be required by the provisions of the Agreement and this Indenture, (b) for the purpose of curing any formal defect, omission, inconsistency or ambiguity herein, or (c) in connection with any other change therein which is not materially adverse to the Owners.  No extension, termination or provision of any substitute Credit Facility in accordance with the provisions of the Agreement shall be deemed a modification, alteration, amendment or supplement to the Agreement, or to this Indenture, for any purpose of this Indenture.

Before the Issuer shall enter into, and the Trustee shall consent to, any modification, alteration, amendment or supplement to the Agreement, pursuant to this Section 13.06, there shall have been delivered to the Issuer and the Trustee, a Favorable Opinion of Bond Counsel.
Section 13.07Amendment of Agreement with Consent of Owners.  Except in the cases of modifications, alterations, amendments or supplements referred to in Sections 13.02 and 13.06 hereof, the Issuer shall not enter into, and the Trustee shall not consent to, any modification, alteration, amendment or supplement of the Agreement, without the written approval or consent of the Owners of not less than a majority in aggregate principal amount of the Bonds then Outstanding but with the consent of the Borrower and the Bank, given and procured as provided in Sections 13.03 and 13.05 hereof; provided, however, that, unless approved in writing by the Owners of all Bonds then Outstanding, nothing in this Section 13.07 shall permit, or be construed as permitting, a change in the obligations of the Borrower under Section 5.02 or 10.01 of the Agreement.  If at any time the Issuer or the Borrower shall request the consent of the Trustee to any such proposed modification, alteration, amendment or supplement, the Trustee shall cause notice thereof to be given in the same manner as provided by Section 13.03 hereof with respect to Supplemental Indentures.  Such notice shall briefly set forth the nature of such proposed modification, alteration, amendment or supplement and shall state that copies of the instrument embodying the same are on file at the Corporate Trust office of the Trustee for inspection by all Owners of Bonds Outstanding.  The Issuer may enter into, and the Trustee may consent to, any such proposed modification, alteration, amendment or supplement of the Agreement, subject to the same conditions and with the same effect as provided in Section 13.03 hereof with respect to Supplemental Indentures.

Section 13.08Issuance of Bonds Under Other Indentures: Recognition of Prior Pledges.  The Issuer hereby expressly reserves the right to issue, to the extent permitted by law, bonds in accordance with other ordinances and indentures for one or more purposes permitted by the Act.  The Issuer hereby recognizes and protects any prior pledge or mortgage made to secure any prior issue of bonds.

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ARTICLE XIV
REMARKETING AGENT; TENDER AGENT; 
PURCHASE AND REMARKETING OF BONDS

Section 14.01Remarketing Agent and Tender Agent.

(a)The Borrower shall appoint a Remarketing Agent for the Bonds, subject to the conditions set forth in Section 14.02(a) hereof.  The Remarketing Agent shall designate its Principal Office and signify its acceptance of the duties and obligations imposed upon it hereunder by a written instrument of acceptance delivered to the Issuer, the Trustee, the Tender Agent and the Borrower under which the Remarketing Agent will agree, particularly, to keep such books and records with respect to the Bonds as shall be consistent with prudent industry practice and to make such books and records available for inspection by the Issuer, the Trustee, the Tender Agent and the Borrower at all reasonable times.

(b)The Borrower shall appoint a Tender Agent for the Bonds; subject to the conditions set forth in Section 14.02(b) hereof.  The Tender Agent shall designate its Principal Office and signify its acceptance of the duties and obligations imposed upon it hereunder by a written instrument of acceptance delivered to the Issuer, the Trustee, the Borrower, the Bank and the Remarketing Agent.

Section 14.02Qualifications of Remarketing Agent and Tender Agent; Resignation; Removal.

(a)The Remarketing Agent shall be a member of the National Association of Securities Dealers, Inc., having a combined capital stock, surplus and undivided profits of at least $15,000,000 and authorized by law to perform all the duties imposed upon it by this Indenture and the Remarketing Agreement.  Any successor Remarketing Agent shall have its obligations rated or be a wholly-owned subsidiary of an entity whose obligations are rated, so long as the Bonds shall be rated by Moody's, at least Baa3/P-3 by Moody's or otherwise qualified by Moody's.  The Remarketing Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving notice to the Issuer, the Trustee, the Bank, if any, the Tender Agent and the Borrower.  Such resignation shall take effect on the earlier of (i) the day a successor Remarketing Agent shall have been appointed by the Borrower and shall have accepted such appointment, or (ii) the 45th day after the receipt by the Issuer and the Borrower of the notice of resignation.  The Remarketing Agent may be removed at any time, pursuant to the Remarketing Agreement.

(b)The Tender Agent shall be an entity duly organized under the laws of the United States of America or any state or territory thereof, and, if not a bank or trust company, for so long as the Bonds shall be rated by Moody's, shall have its obligations rated at least Baa3/P-3 by Moody's or otherwise qualified by Moody's, and in any case having a combined capital stock, surplus and undivided profits of at least $25,000,000 and authorized by law to perform all the duties imposed upon it by this Indenture and the Tender Agreement.  The Tender Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least 30 days' notice to the Issuer, the Trustee, the Borrower, the Remarketing Agent and the Bank.  Such resignation shall take effect on the day a successor Tender Agent shall have

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been appointed by the Borrower and shall have accepted such appointment.  The Tender Agent may be removed at any time by an instrument signed by the Borrower, filed with the Tender Agent, the Issuer, the Trustee, the Remarketing Agent and the Bank.  In the event of the resignation or removal of the Tender Agent, the Tender Agent shall deliver any Bonds and moneys held by it in such capacity to its successor, or if there is no successor, to the Trustee.

Section 14.03Remarketing of Bonds; Notice of Interest Rates.

(a)Upon notice of the tender for purchase of Bonds in accordance with Section 4.08 hereof, the Remarketing Agent shall offer for sale and use its best efforts to sell such Bonds (other than Bonds purchased with moneys derived from the source described in clause (i) of Section 6.02(b) hereof, if so directed by the Borrower), any such sale to be made on the date of such purchase in accordance with Section 4.08 at the best price available in the marketplace; provided, however, that, if a Credit Facility shall be in effect, the Remarketing Agent shall not sell any of such Bonds at a price below the principal amount thereof plus accrued interest thereon, if any.  Any Bond which is tendered for purchase, pursuant to Section 4.08 hereof, and any Bond that has become subject to mandatory tender for purchase pursuant to Section 4.08 hereof, shall be sold only to a purchaser who agrees to refrain from selling that Bond other than under the terms of this Indenture and hold that Bond only to the date of mandatory purchase.

(b)The Remarketing Agent shall determine the rate of interest to be borne by the Bonds during each Interest Rate Period and by each Bond during each Bond Interest Term for such Bond and the Bond Interest Terms for each Bond during each Short-Term Interest Rate Period as provided in Section 2.01 hereof and shall furnish to the Trustee, the Tender Agent, the Borrower and the Bank on the Business Day of determination each rate of interest and Bond Interest Term so determined.

(c)The Remarketing Agent shall give telephonic or telegraphic notice, promptly confirmed by a written notice, to the Trustee and the Tender Agent on each date on which Bonds shall have been purchased pursuant to Section 6.02(b) hereof, specifying the principal amount of Bonds, if any, sold by it pursuant to Section 14.03(a) hereof.

Section 14.04Delivery of Bonds.

(a)Bonds purchased with moneys described in clause (i) of Section 6.02(b) hereof shall be delivered to the Borrower and shall be registered in accordance with instructions from the Borrower.

(b)Bonds purchased with moneys described in clause (ii) of Section 6.02(b) hereof shall be delivered by the Trustee to the Tender Agent or the Remarketing Agent for delivery to the purchasers thereof against payment therefor in accordance with the Tender Agreement.

(c)Bonds purchased with moneys described in clause (iii) of Section 6.02(b) hereof shall be:

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(i)except as otherwise provided in Section 14.04(c)(ii) or (iii) hereof, held by the Tender Agent for the account of the Borrower, if a Credit Facility provides for reinstatement in respect of the drawings for the purchase of Bonds tendered pursuant to Section 4.08 hereof and not remarketed by reimbursement to the Bank of the amount of such drawing together with interest thereon;

(ii)delivered to the Bank, as applicable, if a Credit Facility provides for immediate reinstatement in respect of drawings for the purchase of Bonds tendered pursuant to Section 4.08 hereof and not remarketed by the delivery to the Bank of such Bonds or otherwise requires that Bonds be delivered to the Bank;

(iii)held by the Tender Agent for the account of the Bank, if a Credit Facility provides for immediate reinstatement in respect of drawings for the purchase of Bonds tendered pursuant to Section 4.08 hereof and not remarketed by the holding for the account of the Bank of such Bonds or otherwise requires that Bonds be held for the account of the Bank; or

(iv)delivered to the Trustee for cancellation, if a Credit Facility does not provide for reinstatement in respect of drawings for the purchase of Bonds tendered pursuant to Section 4.08 hereof and not remarketed.

Upon delivery to the Bank, or to the Tender Agent for the account of the Bank, of the Bonds in accordance with clause (ii) or (iii) above, the Trustee shall deliver any certificate evidencing such reimbursement or delivery of Bonds to or for the account of the Bank, as applicable, required for reinstatement, in whole or in part, of any Credit Facility.  Bonds held pursuant to clauses (i), (ii) and (iii) above shall be released for the purpose of remarketing or released to or upon the order of the Borrower only upon receipt by the Tender Agent from the Bank of a written notice to the effect that the Trustee is entitled to draw under a Credit Facility to pay principal of and interest on the Bonds and to pay the purchase price of Bonds purchased pursuant to Section 4.08 hereof and not remarketed in an amount equal to the amount that could be drawn under a Credit Facility if the drawing made to purchase such Bonds were disregarded.

(d)Bonds purchased with moneys described in clause (iv) of Section 6.02(b) hereof shall, at the direction of the Borrower, be (i) held by the Tender Agent for the account of the Borrower, (ii) delivered to the Trustee for cancellation or (iii) delivered to the Borrower; provided, however, that any Bonds so purchased after the selection thereof by the Trustee for redemption shall be delivered to the Trustee for cancellation.

(e)Bonds delivered as provided in this Section 14.04 shall be registered in the manner directed by the recipient thereof.

(f)If the Book-Entry System is in effect, the Trustee shall act in accordance with the procedures and requirements of the Securities Depository then in effect and, if provided by such procedures and requirements, promptly obtain a CUSIP number for the Bank Bonds so that the Bank Bonds can be separately identified by such CUSIP number from all other Bonds.”

(g)So long as the Bonds are Book-Entry Bonds, the tender and put procedures of DTC, as in effect from time to time, shall take precedence over the tender 

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procedures described herein to the extent of any inconsistency and the Remarketing Agent and the Trustee shall not be required to take any actions hereunder other than those required by DTC and the Remarketing Agent.  The parties agree to cooperate to implement such procedures as needed.

Section 14.05Drawings on Credit Facility.  In accordance with the provisions of the Tender Agreement, on each day on which Bonds are to be purchased pursuant to Section 4.08 hereof, except to the extent that (i) moneys described in Section 6.02(b)(i) hereof shall be available for the purchase of such Bonds, or (ii) the Trustee shall have received telephonic or Electronic notification from the Remarketing Agent or the Tender Agent that such Bonds shall have been remarketed pursuant to Section 14.03 hereof and that the moneys described in Section 6.02(b)(ii) hereof will be sufficient to pay the purchase price of such Bonds, the Trustee promptly shall draw under a Credit Facility, in accordance with its terms, an amount sufficient to make timely payment of the purchase price of such Bonds and furnish the proceeds of such drawing to the Tender Agent.  Following payment of all amounts payable in respect of the purchase of Bonds pursuant to Section 4.08 hereof, the Trustee shall remit to the Bank any amount drawn under a Credit Facility in excess of the amount sufficient to make timely payment of the purchase price of such Bonds.

Section 14.06Delivery of Proceeds of Sale.  The proceeds of the sale by the Remarketing Agent of any Bonds delivered to it by, or held by it for the account of, the Borrower or the Bank, or delivered to it by the Bank or any other Owner, shall be turned over to the Borrower, the Bank or such other Owner, as the case may be.  If the applicable Credit Facility provides for reinstatement in respect of the drawings for the purchase of Bonds tendered pursuant to Section 4.08 hereof by reimbursement to the Bank of the amount of such drawing, the Remarketing Agent shall deliver the proceeds of such remarketing to the Bank to the extent the Bank has not been reimbursed, and in connection therewith, the Trustee shall deliver any certificate required for reinstatement, in whole or in part, of any Credit Facility.

ARTICLE XV

MISCELLANEOUS

Section 15.01Indenture to Bind and Inure to Benefit of Successors to Issuer.  In the event of the dissolution of the Issuer, all the covenants, stipulations, promises and agreements in this Indenture contained by or on behalf of, or for the benefit of, the Issuer, shall bind or inure to the benefit of the successors of the Issuer from time to time and any entity, officer, board, commission, agency or instrumentality to whom or to which any power or duty of the Issuer shall be transferred.

Section 15.02Parties in Interest.  Except as herein otherwise specifically provided, nothing in this Indenture expressed or implied is intended or shall be construed to confer upon any person, firm or corporation, other than the Issuer, the Borrower, the Trustee, the Bank and the Owners, any right, remedy or claim under or by reason of this Indenture, this Indenture being intended to be for the sole and exclusive benefit of the Issuer, the Borrower, the Trustee, the Bank and the Owners of the Bonds.  Nothing in this Indenture is intended to create in the Borrower any interest in the Bond Fund or the moneys or Investment Securities therein.

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Section 15.03Severability.  In case any one or more of the provisions of this Indenture or of the Bonds issued hereunder shall, for any reason, be held to be illegal or invalid, such illegality or invalidity shall not affect any other provisions of this Indenture, the Agreement, the Remarketing Agreement, the Tender Agreement or said Bonds, and this Indenture, the Agreement, the Remarketing Agreement, the Tender Agreement and the Bonds shall be construed and enforced as if such illegal or invalid provisions had not been contained herein or therein.

Section 15.04No Personal Liability of Issuer Under Indenture.  No covenant or agreement contained in the Bonds or in this Indenture shall be deemed to be the covenant or agreement of any official, officer, agent, or employee of the Issuer in his individual capacity, and neither the members of the Issuer's Board of Directors nor any official executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof.

Section 15.05Bonds Owned by the Issuer or the Borrower.  In determining whether Owners of the requisite aggregate principal amount of the Bonds have concurred in any direction, consent or waiver under this Indenture, Bonds which are owned by the Issuer or the Borrower or by any affiliate of the Borrower (unless the Issuer, the Borrower and such persons own all Bonds which are then Outstanding, determined without regard to this Section 15.05) shall be disregarded and deemed not to be Outstanding for purpose of any such determination, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver, only Bonds which the Trustee knows are so owned shall be so disregarded.  Bonds so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Bonds and that the pledgee is not the Issuer or the Borrower or any affiliate of the Borrower. Bonds delivered to the Bank or held by the Tender Agent for the account of the Bank pursuant to Section 14.04(c) hereof shall be regarded as Outstanding for purposes of this Section 15.05 and shall be owned by the Bank for purposes of this Section 15.05.

Section 15.06Governing Law.  This Indenture and the Bonds shall be construed in accordance with and governed by the Constitution and laws of the State of Arizona, provided however, that the rights, protections and immunities of the Trustee shall be governed by the laws of the State of California.

Section 15.07Notices.  Except as otherwise provided in this Indenture, all notices, certificates, requests, requisitions or other communications by the Issuer, the Borrower; the Trustee, the Tender Agent, the Paying Agent, the Registrar, the Remarketing Agent, Moody's, S&P and the Bank pursuant to this Indenture shall be either electronic or in writing and shall be sufficiently given and shall be deemed given when mailed by first-class mail, postage prepaid, addressed as follows:

If to the Trustee:
Union Bank, N.A.
120 South San Pedro, 4th Floor

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Los Angeles, CA 90012
Attention: Corporate Trust Department
Fax:  (213-972-5694)
Email:  Jennifer.earle@unionbank.com
If to the Tender Agent:
Union Bank, N.A.
120 South San Pedro, 4th Floor
Los Angeles, CA 90012
Attention: Bond Redemption
If to Moody's:
Moody's Investors Service 
99 Church Street
New York, New York 10007-2796 
Attention: Structured Finance Group

If to S&P:
Standard & Poor's Rating Services 
55 Water Street, 38th Floor
New York, New York 10041 
Attention: Public Finance Department Structured Finance Group

If to the Registrar, the Paying Agent and the Bank, at the address designated herein or designated to the Issuer, the Borrower and the Trustee.  Any of the foregoing may, by notice given hereunder to each of the others, designate any further or different addresses to which subsequent notices, certificates, requests or other communications shall be sent hereunder.
Section 15.08Non-Business Days.  If the last day of any period of grace, or the date for making any payment or the last date for performance of any act or the exercising of any right, as provided in this Indenture, is not a Business Day, the last day of such period of grace shall be deemed to be, any such payment may be made or act performed or right exercised, with the same force and effect as if done on the nominal date provided in this Indenture, on the next succeeding Business Day, and no interest shall accrue for the period after such nominal date.

Section 15.09Opinions.  Each opinion with respect to the validity of documents or Bonds may be qualified to the extent of the application of bankruptcy, insolvency, moratorium or reorganization laws or laws affecting the remedies for the enforcement of the rights and security provided therein and need not pass on the availability of the remedy of specific enforcement, injunctive relief or any other equitable remedy.

Section 15.10Headlines; Table of Contents.  The division of this Indenture into sections, the provision of a table of contents and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation hereof

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Section 15.11Execution in Several Counterparts.  This Indenture may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original; and all such counterparts, or as many of them as the Issuer and the Trustee shall preserve undestroyed, shall together constitute but one and the same instrument.

Section 15.12Statutory Notice.  In accordance with the terms thereof, notice is hereby given of Title 38, Chapter 3, Section 38-51l, Arizona Revised Statutes, which provides, among other things, that the State of Arizona, its political subdivisions or any department or agency of either may, within three years after its execution, cancel any contract, without penalty or further obligation, made by said State, its political subdivisions, or any of the departments or agencies of either if any person significantly involved in initiating, negotiating, securing, drafting or creating the contract on behalf of said State, its political subdivisions or any of the departments or agencies of either is, at any time while the contract or any extension of the contract is in effect, an employee or agent of any other party to the contract in any capacity or a consultant to any other party of the contract with respect to the subject matter of the contract.

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IN WITNESS WHEREOF, the Issuer has caused this Indenture to be signed in its name by its duly authorized officer, and the Trustee, in token of its acceptance of the trust created hereunder, has caused this Indenture to be signed in its name by its duly authorized signatory, all as of the day and year first above written.

MARICOPA COUNTY, ARIZONA
POLLUTION CONTROL CORPORATION
By:        /s/ Norman L. Knox         
      Norman L. Knox Title: President                 
                   
UNION BANK, N.A., as Trustee
By:        /s/ Lorraine McIntire       
             Authorized Officer                    
                    

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EXHIBIT A
FORM OF BOND

A-1

 
(Form for Transfer)
COMPLETE AND SIGN THIS FORM FOR
REGISTRATION OF TRANSFER OR TRANSFER
For value received ________ hereby sells, assigns and transfers unto ____________ this Bond and hereby irrevocably constitutes and appoints ____________________, Attorney, to register such transfer on the books of registration in the office of the Registrar with full power of substitution in the premises.
Dated:   
Signatures Guaranteed by:______________________

NOTE: The signatures on this assignment must correspond with the names as written on the face of this Bond in every particular, without alteration, enlargement or any change whatsoever.
                                                               
Signatures must be guaranteed in 
accordance with the terms of one of
the nationally recognized medallion
signature guarantee programs.

	
	
	 

	 

A-2

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