AMENDMENT NO. 1 TO CREDIT AGREEMENT

UNS ELECTRIC, INC., as a Borrower

/s/ Kentton C. Grant

Name: Kentton C. Grant

Title: Vice President

EX-4.T.2 7 d285669dex4t2.htm EX-4.T.2 EX-4.T.2

Exhibit 4(t)(2)

[Execution Version]

AMENDMENT NO. 1

CREDIT AGREEMENT

This AMENDMENT NO. 1, dated as of November 18, 2011 (this “Amendment”), is made by and among UNS ELECTRIC, INC., an Arizona corporation (“UNS Electric”), and UNS GAS, INC., an Arizona corporation (“UNS Gas”, and together with UNS Electric being referred to herein, individually, as a “Borrower” and, collectively, as the “Borrowers”), UNISOURCE ENERGY SERVICES, INC., an Arizona corporation (the “Guarantor”), the lenders listed on the signature pages of this Amendment as “Lenders” (such lenders, together with their respective permitted assignees from time to time, being referred to herein, collectively, as the “Lenders”), JPMORGAN CHASE BANK, N.A., WELLS FARGO BANK, NATIONAL ASSOCIATION and UNION BANK, N.A., as issuing banks (collectively, in such capacities, the “Issuing Banks”), and UNION BANK, N.A. (formerly known as Union Bank of California, N.A.), as administrative agent (in such capacity, the “Administrative Agent”).

PRELIMINARY STATEMENT:

The Borrowers, the Guarantor, the Lenders and the Administrative Agent previously entered into that certain Second Amended and Restated Credit Agreement, dated as of November 9, 2010 (the “Existing Agreement”, as amended by this Amendment, the “Amended Agreement”, and as the Amended Agreement may hereafter be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”). The Borrowers desire to amend the Existing Agreement to (a) extend the Final Maturity Date to November 9, 2016, (b) reduce the Applicable Margin and the Commitment Fee Rate, and (c) make certain other modifications thereto, and the Lenders, the Issuing Banks and the Administrative Agent have agreed to such amendments on the terms and conditions set forth herein. The parties therefore agree as follows (capitalized terms used but not defined herein having the meanings assigned to such terms in the Existing Agreement):

SECTION 1. Amendments to Existing Agreement. The Existing Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2 hereof, hereby amended as follows:

(a) Disclosure Documents. The definition of “Disclosure Documents” contained in Section 1.01 of the Existing Agreement is hereby amended and restated in its entirety to read as follows:

“Disclosure Documents” means (a) the Annual Report on Form 10-K of UniSource Energy for the fiscal year ended December 31, 2010, as filed with the SEC, (b) the Quarterly Reports on Form 10-Q of UniSource Energy for the fiscal quarters ended March 31, 2011, June 30, 2011 and September 30, 2011, as filed with the SEC, and (c) the Current Reports on Form 8-K of UniSource Energy as filed with the SEC on May 11, 2011 and August 12, 2011.

(b) Final Maturity Date. The definition of “Final Maturity Date” contained in Section 1.01 of the Existing Agreement is hereby amended and restated in its entirety to read as follows:

“Final Maturity Date” means November 9, 2016.

(c) Additional Definitions. The following new definitions are hereby added to Section 1.01 of the Existing Agreement in appropriate alphabetical order:

“Amendment No. 1” shall mean Amendment No. 1, dated as of November 18, 2011, among the Borrowers, the Guarantor, the Issuing Banks, the Lenders and the Administrative Agent, which Amendment No. 1 amended this Agreement pursuant to the terms thereof.

“Amendment No. 1 Effective Date” shall mean November 18, 2011.

(d) Disclosure; No Material Adverse Change; Etc. Section 7.01(c) of the Existing Agreement is hereby amended by (i) deleting the date “December 31, 2009” in its entirety set forth in subsection (ii) thereof and substituting therefor the new date “December 31, 2010” and (ii) deleting the phrase “prior to the Closing Date” in its entirety set forth in subsection (iii) thereof and substituting therefor the new phrase “prior to the Amendment No. 1 Effective Date”.

(e) Financial Condition. Section 7.01(d) of the Existing Agreement is hereby amended by (i) deleting each reference to the date “December 31, 2009” in its entirety and substituting therefor in each case the new date “December 31, 2010” and (ii) deleting the phrase “to and including the date hereof” in its entirety and substituting therefor the new phrase “to and including the Amendment No. 1 Effective Date”.

(f) Organization and Ownership of Shares of Subsidiaries of each Obligor. Section 7.01(e)(i) of the Existing Agreement is hereby amended by deleting the phrase “As of the Closing Date” in its entirety and substituting therefor the new phrase “As of the Amendment No. 1 Effective Date”.

(g) Pricing Schedule. Schedule 1.01 of the Existing Agreement is hereby replaced in its entirety with Schedule A attached hereto.

SECTION 2. Conditions of Effectiveness. This Amendment shall become effective as of the date first written above (the “Effective Date”) when, and only when, (a) the Administrative Agent shall have received all fees (including, without limitation, all upfront fees) payable by the Borrowers pursuant to that certain proposal letter agreement, dated October 5, 2011, among Union Bank, the Borrowers, UniSource Energy and Tucson Electric Power Company (the “Proposal Letter”), together with, to the extent invoiced, reimbursement or payment of all reasonable fees and out-of-pocket disbursements of counsel to the Administrative Agent and other out-of-pocket expenses of the Administrative Agent required to be reimbursed or paid by the Borrowers pursuant to the Proposal Letter, (b) all requisite Governmental Authorities and third parties, if any, shall have approved or consented to the execution, delivery and performance

by the Obligors of this Amendment and the Amended Agreement and the transactions contemplated thereby (collectively, the “Transactions”) to the extent required and material (and the Administrative Agent shall have received copies, certified by an Authorized Officer of the applicable Obligor to be true, correct and complete and in full force and effect, of all such approvals and consents, which shall be in form and substance satisfactory to the Administrative Agent and the Lenders), no stay of any applicable regulatory approval shall have been issued and there shall be no litigation or governmental, administrative or judicial action, actual or, to the knowledge of the Obligors, threatened, that could reasonably be expected to restrain, prevent or impose burdensome conditions on this Amendment, the Amended Agreement, any of the other Loan Documents or the Transactions, and (c) the Administrative Agent shall have received: (i) counterparts of this Amendment executed by all of the parties hereto (in sufficient quantity for each party to have a fully executed original), and (ii) all of the following documents, each document being dated the Effective Date unless otherwise specified below, in form and substance satisfactory to the Administrative Agent and in the number of originals or photostatic copies reasonably requested by the Administrative Agent:

(A) a favorable written opinion (addressed to the Administrative Agent, the Issuing Banks and the Lenders) of (1) Morgan, Lewis & Bockius LLP, New York counsel for the Obligors, and (2) Todd C. Hixon, Esq., General Counsel for the Guarantor and counsel for the Borrowers, in each case covering such customary matters relating to this Amendment, the Amended Agreement and the Transactions as the Administrative Agent shall reasonably request, and the Obligors hereby request such counsel to deliver such opinions;

(B) such documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence and good standing of the Obligors, the authorization of the Transactions, and any other legal matters relating to the Obligors, this Amendment, the Amended Agreement or the Transactions, all in form and substance satisfactory to the Administrative Agent and its counsel;

(C) a certificate (the statements in which shall be true), signed by an Authorized Officer of each Obligor, certifying that:

(1) the representations and warranties of the Obligors set forth in this Amendment, the Amended Agreement and the other Loan Documents are true and correct on and as of the Effective Date with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties were true and correct as of such earlier date); and

(2) both before and after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing; and

(D) a certificate, signed by an Authorized Officer of each Obligor, confirming compliance with the conditions set forth in this Section 2.

SECTION 3. Representations and Warranties of the Obligors. Each Obligor represents and warrants to the Administrative Agent, each Lender and each Issuing Bank that:

(a) Authorization; Enforceability. Such Obligor has the corporate power and authority to execute and deliver this Amendment and to perform the provisions of this Amendment and the Amended Agreement. This Amendment has been duly authorized by all necessary corporate action on the part of such Obligor, and each of this Amendment and the Amended Agreement constitutes a legal, valid and binding obligation of such Obligor enforceable against such Obligor in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). This Amendment and has been duly executed and delivered by such Obligor.

(b) Governmental Authorizations. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by such Obligor of this Amendment, except for the ACC Order, which ACC Order has been obtained and is in full force and effect.

(c) Compliance with Laws, Other Instruments, etc. The execution and delivery by such Obligor of this Amendment, and the performance by such Obligor of this Amendment and the Amended Agreement, will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any Property of such Obligor or any of its Subsidiaries under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or by-laws, or any other agreement or instrument to which such Obligor or any such Subsidiary is bound or by which such Obligor or any such Subsidiary or any of their respective Properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to such Obligor or any of its Subsidiaries or (iii) violate any provision of any Governmental Rule applicable to such Obligor or any of its Subsidiaries.

(d) Litigation. There are no actions, suits or proceedings pending or, to the knowledge of such Obligor, threatened against or affecting such Obligor or any of its Subsidiaries or any Property of such Obligor or any of its Subsidiaries in any court or before any arbitrator of any kind or before or by any Governmental Authority that involve this Amendment, the Amended Agreement or the Transactions.

(e) No Default. No Default or Event of Default has occurred and is continuing or would occur as a result of the execution, delivery or performance of this Amendment.

SECTION 4. Reference to and Effect on the Existing Agreement. (a) Upon the effectiveness of this Amendment: (i) each reference in the Existing Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Existing Agreement shall mean and be a reference to the Amended Agreement; and (ii) each reference in any other Loan Document to “the Credit Agreement”, “thereunder”, “thereof” or words of like import referring to the Existing Agreement shall mean and be a reference to the Amended Agreement. This Amendment shall constitute a “Loan Document” for all purposes under the Credit Agreement.

(b) Except as specifically amended above, the Existing Agreement shall continue to be in full force and effect and is hereby in all respects ratified and confirmed.

(c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Lenders, the Administrative Agent or the Issuing Banks under the Existing Agreement or any other Loan Document, nor constitute a waiver of any provision of the Existing Agreement or any other Loan Document.

SECTION 5. Costs and Expenses. The Borrowers agree to pay, promptly after delivery to the Borrowers of a reasonably detailed statement therefor, all reasonable costs and expenses of the Administrative Agent in connection with the preparation, negotiation, syndication, execution and delivery of this Amendment and the other instruments and documents to be delivered hereunder, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent with respect thereto and with respect to advising the Administrative Agent as to its rights and responsibilities hereunder and thereunder, and all costs and expenses of the Administrative Agent, the Issuing Banks and each Lender (including, without limitation, the fees and disbursements of counsel to the Administrative Agent, counsel for each Issuing Bank and counsel for each Lender) in connection with the enforcement (whether through negotiations, legal proceedings or otherwise) of this Amendment and the other documents to be delivered hereunder.

SECTION 6. Execution in Counterparts. This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original but all of which when taken together shall constitute a single contract. Delivery of an executed signature page to this Amendment by facsimile or other electronic transmission (including, without limitation, by Adobe portable document format file (also known as a “PDF” file)) shall be as effective as delivery of a manually signed counterpart of this Amendment.

SECTION 7. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of the New York.

SECTION 8. Miscellaneous. This Amendment shall be subject to the provisions of Sections 12.09, 12.10, 12.11 and 12.13 of the Existing Agreement, each of which is incorporated by reference herein, mutatis mutandis.

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