AGENDA ITEM
Public Utilities Commission
City and County of San Francisco
DEPARTMENT Financial Services AGENDA NO. 13
MEETING DATE February 27, 2024
A
pprove a Form of Bank Credit Agreement: Regular Calendar P
roject Manager: Nikolai J. Sklaroff
Approve the Form of Bank Credit Agreement, Amendment 4 for the CleanPowerSF Program
Summary of
Proposed
Commission Action
Approve the form of Amendment 4 to the Credit Agreement and associated amended and restated Fee Agreement with JPMorgan Chase Bank, National Association with an initial not- to-exceed commitment amount of $75,000,000 and extend the term of the agreement by three years for a total duration of nine years to provide credit support for the CleanPowerSF Program to meet anticipated revisions to the financial security requirement s of the California Public Utilities Commission ; and a uthorize the General Manager to negotiate final terms and execute the Amendment to Credit Agreement and associated amended and restated Fee Agreement , subject to Board of Supervisors approval of the ordinance amending Ordinance No. 8-18 in Board of Supervisors File No. 171172.
Background: On January 23, 2018 , the Board of Supervisors adopted Ordinance No. 8-18, delegating to the General Manager authority to enter credit agreement(s) for CleanPowerSF approved by the San Francisco Public Utilities Commission (SFPUC) with a maximum term of six years and a maximum credit commitment of up to $150,000,000.
On Ja nuary 23, 2018, this Commission adopted Resolution No. 18- 0012 approving the form of, and authorizing the General Manager to enter into , a credit agreement and associated fee agreement (and amendments to such agreements) with JPMorgan Chase Bank with a not to exceed commitment amount of up to $150,000,000 and a term of up to six years to provide credit support to the CleanPowerSF program. The Credit Agreement was issued and used for several purposes, including providing: ( a) one or more standby letters of credit to secure certain payment obligations of CleanPowerSF pursuant to one or more Power Purchase Agreements, including early termination payments and monthly payment obligations; ( b) standby
letters of credit to satisfy financial security requirements of interconnection agreements with PG&E for CleanPowerSF solar Execute Agreement: Approve the Form of Bank Credit Agreement in Support of the CleanPowerSF Program Commission Meeting Date: January 9, 2024
projects; (c) a standby letter of credit to satisfy financial security requirements of the California Public Utilities Commission (CPUC) for Community Choice Agg regation (CCA) Programs such as CleanPowerSF, to provide assurance that costs associated with returning customers to the incumbent utility provided can be paid; and (d) a revolving line of credit that can be drawn upon to meet other CleanPowerSF needs, as needed, although to date the revolving line of the Credit Agreement has not been drawn on for such purpose.
In March 2018, the SFPUC entered into a Credit Agreement with JPMorgan Chase Bank for an initial term of five years and a credit commitment of $75,000,000.
Between July 2019 and May 2022, the SFPUC entered into several amendments to the original March 2018 Agreement:
• Amendment 1 (July 2019) The Credit Agreement was
amended to incorporate revised reserve requirements as the CleanPowerSF program continued to expand expanded. There was no change to the agreement commitment amount and
terms.
• Amendment 2 (November 2021) The Credit Agreement was
amended to provide for a decrease in the commitment amount from $75,000,000 to $20,000,000 and extended the agreement by one year from March 2023 to March 2024. Additional
changes to the agreement included primarily, elimination of target reserve requirements, revisions to debt service coverage and rate -setting covenants, changes to on- going reporti ng requirements to JPMorgan Chase Bank, and elimination of and changes to certain events of default.
• Amendment 3 (May 2022) In May 2022, the SFPUC entered into amendments to eliminate and change certain financial covenants from the original Credit Agreemen t. Specifically, this amendment primarily eliminated the covenant for
CleanPowerSF to maintain a specified debt service ratio and changed such financial covenant to commit CleanPowerSF to maintain a specified level of days liquidity on hand.
On December 12, 2023, by Resolution No. 23- 0221, this Commission recommended that the Board of Supervisors amend Ordinance No. 8- 18 (File No. 171172) (Proposed Ordinance Amendment) to authorize the General Manager enter into amendments or replacement credit agreements f or up to $150,000,000 of credit support for the CleanPowerSF Program for an additional period or periods not exceeding 10 years and authorizing the General Manager and SFPUC to seek advancement of the Proposed Ordinance Amendment for consideration by the B oard of Supervisors. The Proposed Ordinance Amendment is expected to be introduced to the Board of Supervisors in January 2024.
Execute Agreement: Approve the Form of Bank Credit Agreement in Support of the CleanPowerSF Program Commission Meeting Date: January 9, 2024
Proposed Amendment 4:Staff seeks approval of the form of a fourth Amendment to the Credit Agreement and second amended and restated fee agreement to provide for an extension of the Credit Agreement with JPMorgan Chase Bank by three additional years for a total term of up to nine years with an initial credit commitment amount not to exceed $75,000,000 . The purpose of the proposed amendment is to meet anticipated revisions to the financial security requirements of the California Public Utilities Commission (CPUC) as described below.
Reasons for the Credit Agreement Amendment:
The extension of the Credit Agreement is needed for the following:
Pursuant to the on-going power purchase agreements and potentially future agreements , standby letters of credit (LOCs ) can be issued under the credit agreement to power providers as collateral if needed, in-lieu of the program posting cash. The Credit Agreement has enabled CleanPowerSF to provide payment security to power sellers, resulting in more favorable power contract pricing and low er power costs for CleanPowerSF . The need for LOCs posted for this purpose has decreased since CleanPowerS F currently maintains an A2 issuer rating from Moody’s Investors Service. However, there is a possibility future power providers will require collateral postings.
CleanPowerSF posts financial s ecurity requirements to PG&E for certain interconnection agreements for CleanPowerSF solar projects on SFPUC facilities.
The Credit Agreement will continue to provide CleanPowerSF with a revolving line of credit that would allow it to meet other working capital program needs, if required.
Finally, CleanPowerSF also has posted a standby LOC to PG&E as required by the CPUC to cover associated costs of customers returning to the incumbent utility. This Financial Security Requirement (FSR) is expected to remain in place indefinitely, and the CPUC is expected to increase the FSR requirement substantially by the end of the calendar year (December 2023).
Recommended Credit Facility and Terms:
Staff, after consultation with the SFPUC’s Municipal Advisor (PFM California Adv isors LLC), recommends extension of the existing credit agreement for an additional three years with change s to the current agreement structure acceptable to the SFPUC and with the proposed fees discussed below. CleanPowerSF requests an increase in the Credit Agreement amount to $75,000,000 to account for the increased California Public Utilities Commission (CPUC) Financial Security Requirement (FSR) discussed above.
The proposed Amended Credit Agreement would have a n available commitment amount of $75,000,000 with an undrawn annual cost of
0.45% at the current CleanPowerSF credit rating (minimum annual Execute Agreement: Approve the Form of Bank Credit Agreement in Support of the CleanPowerSF Program Commission Meeting Date: January 9, 2024
cost of approximately $337,500 per year), Letters of Credit Fees at an annual cost of 1.25%, and at either the Alternative Base Rate (A BR) under certain conditions as defined in the agreement or Adjusted Term Secured Overnight Financing Rate ( SOFR) plus 1.5% .While it is not expected that CleanPowerSF would need to draw the full amount of the facility, a full draw would not exceed $5,100,000 per year for a 12 month draw of the full agreement amount based on interest rates as of November 29, 2023. These terms are comparable to those entered into by other CCA entities and are lower than fees under the existing agreement terms.
Summary of
Documents
The following are brief summaries of the documents that the Commission is being asked to approve in form:
Fourth Amendment to Credit Agreement: This agreement, by and between the SFPUC and JPMorgan Chase Bank (the Bank) provides for the amendment of the terms of the existing Credit Agreement. The changes being made to the Credit Agreement are set forth in a marked copy of the existing Credit Agreement attached as Exhibit A to the Fourth Amendment . The Credit Agreement sets forth the terms pursuant to which SFPUC may request that an LOC is issued (and may be amended, renewed or extended) in favor of each power provider or other beneficiaries as needed, as well as the terms under which the SFPUC repays the Bank for draws on the LOC. The LOC is the credit facility that can be drawn upon by the power providers for any termination payment or monthly payment obligations directly from the Bank, should CleanPowerSF be unable to make such payments. The Credit Agreemen t sets forth t he terms for any borrowings, or draws, by CleanPowerSF under the revolving line of credit. The Credit Agreement also sets forth the covenants and representations of SFPUC, the events of default under the agreement and the remedies of the Bank for such even
ts. The changes being
made to the Credit Agreement include the extension of the term to 2027 and the increase in the available commitment amount to $75,000,000. Other changes primarily reflect the incorporation of the applicable borrowing rates and provisions for the determination of the applicable interest rate in the event the benchmark (Adjusted Term SOFR) used in setting the rate is no longer available.
Second Amended and Restated F ee Agreement : This agreement, by and between the SFPUC and the Bank, se ts forth the fees the Bank charges in connection with the Credit Agreement, including the undrawn annual costs and the LOC fees for the issuance of and any draws upon the LOC. It also sets forth the fees and charges for any borrowings, or draws, by CleanPo werSF
under the revolving line of
credit.
Environmental
Review:
The proposed JPMorgan Agreements do not constitute a “project” under California Environmental Quality Act (CEQA) Guidelines Execute Agreement: Approve the Form of Bank Credit Agreement in Support of the CleanPowerSF Program Commission Meeting Date: January 9, 2024
section 15378(b)(4) because this approval would constitute the creation of a government funding mechanism which does not involve any commitment to a specific project which may result in a potentially significant physical change in the environment.
Attachments: 1. Form of Fourth Amendment to Credit Agreement
2. Form of Second Amended and Restated Fee Agreement
PUBLIC UTILITIES COMMISSION
City and County of San Francisco
RESOLUTION NO. __________
WHEREAS, The San Francisco Board of Supervisors (Board) established a community choice aggregation (CCA) program in 2004 (Ordinance 86-04) and has implemented the program, called CleanPowerSF, through the work of the San Francisco Public Utilities Commission (SFPUC) in consultation with the San Francisco Local Agency Formation Commission (Ordinances 146-07, 147-07, and 232-09); and
WHEREAS, CleanPowerSF serves its customers with electricity purchased through wholesale market transactions; and
WHEREAS, To secure the obligations of CleanPowerSF to purchase electricity and to enable CleanPowerSF to enter into working capital loans as part of conducting its normal business activities, the PUC issued a Request for Proposals (RFP) in July 2017 to qualified banks to provide a credit agreement in a principal amount not to exceed $150,000,000; and WHEREAS, After an evaluation of the responses to the RFP, Commission staff determined that JPMorgan Chase Bank, National Association (JPMorgan) provided the most advantageous terms to the Commission; and
WHEREAS, In Board of Supervisors Ordinance No. 8-18, the Board also authorized the General Manager, subject to the conditions specified in Board of Supervisors Ordinance No. 8 -18, to enter into a bank facility credit agreement with JPMorgan, the selected provider, or another entity, subject to the conditions specified in Board of Supervisors Ordinance No. 8-18, including, among other things, that the total credit commitment under the bank credit facility agreement not exceed $150 million over the term of the agreement, and that the term of the agreement not exceed six years; and
WHEREAS, Under the authority granted by Ordinance No. 8-18, and as authorized and approved in SFPUC Resolution No. 18-0012 adopted by the Commission on January 23, 2018, the SFPUC has previously entered into a Credit Agreement dated as of March 29, 2018 as amended, restated, supplemented or modified from time-to-time, and a fee agreement as amended and restated, with JPMorgan (collectively, the Credit Agreement), which Credit Agreement has a stated expiration date of March 29, 2024; and
WHEREAS, The SFPUC has an ongoing need for access to a bank credit facility to provide liquidity support, as needed, for authorized power purchase Contracts, to meet regulatory requirements and for other financial obligations for CleanPowerSF, through letters of credit or loans; and
WHEREAS, Pursuant to SFPUC Resolution No. 23-0221, the SFPUC is seeking, through a proposed amendment to Board of Supervisors Ordinance No. 8-18 in Board of Supervisors File No. 171172, to be considered by the Board (the Ordinance Amendment), authorization by the Board for the General Manager to enter into amendments to and/or an amended and restated credit agreement with JPMorgan and/or a replacement bank credit facility agreement with another entity, with a total principal amount of the credit commitment available at any time under the bank credit facility agreement not exceeding $150 million, and with a term not exceeding ten years from the stated expiration date of the existing Credit Agreement; and
WHEREAS, Commission staff has determined that the amendment and extension of the existing Credit Agreement with JPMorgan represents the best opportunity available to the City to obtain and continue such desired essential liquidity support in the current market environment for such facilities; and
WHEREAS, The form of the Fourth Amendment to Credit Agreement, and a related second amended and restated fee agreement (together, the JPMorgan Agreements), proposed to be entered into by the Commission and JPMorgan have been presented to the Commission, and the Commission finds it in its best interest to enter into such agreements, contingent upon subsequent Board of Supervisors enactment of the proposed Ordinance Amendment to Board of Supervisors Ordinance No. 8-18; and
WHEREAS, CleanPowerSF will undertake to pay all of the obligations under the JPMorgan Agreements, including but not limited to, the costs of any payments to JPMorgan, including the annual standby letter of credit fee and repayment of principal and int erest on working capital loans, and the costs and expenses of any term loan; and
WHEREAS, The proposed JPMorgan Agreements do not constitute a “project” under California Environmental Quality Act (CEQA) Guidelines section 15378(b)(4) because this approval would constitute the creation of a government funding mechanism which does not involve any commitment to a specific project which may result in a potentially significant physical change in the environment;
now, therefore, be it
RESOLVED, Subject to approval by the Board of Supervisors of the Ordinance Amendment, this Commission approves the JPMorgan Agreements, in substantially the forms submitted to this Commission, and the Commission authorizes the General Manager to enter into the JPMorgan Agreements, w ith such additions thereto or changes therein which the General Manager, upon consultation with the City Attorney, shall approve, with an aggregate principal amount of credit to be made available by JPMorgan under the JPMorgan Agreements initially not to exceed $75,000,000 at any one time, and with an extension of the Credit Agreement term not exceeding three years, to secure payments arising under any Contract entered into in connection with CleanPowerSF, to meet CleanPowerSF’s financial security requirements established by the CPUC and other financial obligations of CleanPowerSF, and to enter into working capital loans; provided, that the annual credit facility fee payable to JPMorgan shall not exceed $5,100,000 per year; and be it FURTHER RESOLVED, The General Manager , in consultation with the City Attorney, is hereby authorized to execute such other agreements, certifications or documents and to take any and all necessary action in furtherance of the actions hereby approved, such approval to be conclusively evidenced by the execution and delivery of such documents; and be it FURTHER RESOLVED, The General Manager is further authorized, in consultation with the City Attorney, to execute further amendments to the JPMorgan Agreements provided that the aggregate principal amount of the credit made available thereunder and the term thereof are in accordance with the Ordinance Amendment, and no other terms are changed which would increase the financial risk to the Commission, or increase the credit facility fee beyond $5,100,000 per year; and be it
FURTHER RESOLVED, That this Commission makes the following finding in compliance with the California Environmental Quality Act (“CEQA”), California Public Resources Code Sections 21000 et seq., the CEQA Guidelines, 15 Cal. Administrative Code Sections 15000 et seq., (the “CEQA Guidelines”), and San Francisco Administrative Code Chapter 31 that obtaining credit support for CleanPowerSF is not subject to CEQA because as the establishment of a government financing mechanism to secure power purchases, it does not identify individual specific projects to be constructed with the funds, it is not a project as defined by CEQA and the CEQA Guidelines; and be it
FURTHER RESOLVED, The General Manager is authorized to delegate any of the responsibilities or duties authorized in this resolution; and be it FURTHER RESOLVED, All actions previously taken by the officials, employees, and agents of the SFPUC with respect to obtaining credit support for CleanPowerSF are hereby approved, confirmed, and ratified; and be it
RESOLVED, This resolution shall take effect from and after its adoption.
I hereby certify that the foregoing resolution was adopted by the Public Utilities Commission at its meeting of January 23, 2024.
Secretary, Public Utilities Commission
CHAPMAN DRAFT DATED DECEMBER 12, 2023
CleanPowerSF - Second Amended Restated Fee Agreement 4855-0712-4371 v4.docx 4362141
SECOND AMENDED AND RESTATED FEE AGREEMENT
This SECOND AMENDED AND RESTATED FEE AGREEMENT dated [______, 2024] (as amended, modified or restated from time to time, this “Fee Agreement” ), is by and between the PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (together with its successors and assigns, the “Commission” ) and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION (together with its successors and assigns, the “Bank”).
Reference is made to the (i) Credit Agreement dated as of March 29, 2018 (as amended, modified, extended or restated from time to time, including as amended by the Fourth Amendment to Credit Agreement dated the date hereof, the “Agreement”), entered into between the Commission and the Bank and (ii) Amended and Restated Fee Agreement dated November 10, 2021 (the “Existing Fee Agreement”), by and between the Commission and the Bank. Capitalized terms not otherwise defined herein have the meanings set forth in the Agreement.
The Commission and the Bank have agreed to certain modifications to the Existing Fee Agreement and, for the sake of clarity and convenience, the Commission and the Bank wish to amend and restate the Existing Fee Agreement in its entirety, and this Fee Agreement shall amend and restate the Existing Fee Agreement in its entirety. The purpose of this Fee Agreement is to confirm the agreement between the Bank and the Commission with respect to, among other things, the Undrawn Fees (as defined below) and LC Facility Fees (as defined below) and certain other fees payable by the Commission to the Bank. This Fee Agreement is the Fee Agreement referenced in the Agreement and the terms of this Fee Agreement are incorporated by reference into the Agreement. This Fee Agreement and the Agreement are to be construed as one agreement between the Commission and the Bank, and all obligations hereunder are to be construed as obligations thereunder. All references to amounts due and payable under the Agreement will be deemed to include all amounts, fees and expenses payable under this Fee Agreement.
Article I F
EES.
Section 1.1 Undrawn Fees. The Commission agrees to pay to the Bank, in immediately available funds, on [April 1, 2024] (for the period commencing on [January 1, 2024] and ending on [March 31, 2024]), and in arrears on the first Business Day of each July, October, January and April occurring thereafter (each, a “Payment Date”) until the earlier of the Maturity Date and the date the Commitment is terminated in full, a non-refundable undrawn fee (the “Undrawn Fee”) in an amount equal for each day during the relevant calculation period to the product of (x) the rate per annum associated with the Applicable Issuer Rating (as defined below) as specified for the applicable Level under the column captioned “Undrawn Fee Rate” (the “ Undrawn Fee Rate”) in the applicable pricing matrix set forth below and in effect on such day, (y) the Unutilized Commitment for such day and (z) a fraction the numerator of which is 1 and denominator of which is 360.
(i) For the period commencing on [January 1, 2024], to but not including [_______, 2024] (the “Amendment Date”), the Undrawn Fee Rate, the LC Fee Rate (as hereinafter defined) 2 and the Applicable Rate (as hereinafter defined) shall be determined in accordance with the terms specified in the Existing Fee Agreement.
(ii) For the period commencing on the Amendment Date and at all times thereafter, the Undrawn Fee Rate, the LC Fee Rate and the Applicable Rate shall be determined as follows:
LEVEL
APPLICABLE
ISSUER RATING
UNDRAWN
FEE RATE LC FACILITY FEE RATE
APPLICABLE
RATE
Level 1: A/A2 or higher 0.45% 1.25% 1.50%
Level 2: A-/A3 0.50% 1.35% 1.60%
Level 3: BBB+/Baa1 0.60% 1.60% 1.85%
Level 4: BBB/Baa2 0.70% 1.85% 2.10%
Level 5: BBB–/Baa3 0.80% 2.00% 2.35%
The following paragraph applies to each pricing grid set forth above. The term “Unutilized Commitment” as used in this Fee Agreement means, for any day, the number obtained by subtracting the Revolving Credit Exposure as of 5:00 p.m. New York City time on such day from the Commitment in effect at as of 5:00 p.m. New York City time on such day. The Bank shall provide the Commission with an invoice for each Undrawn Fee; provided, however, that the failure of the Bank to do so shall not relieve the Commission from its obligation to pay such Undrawn Fee. The term “Applicable Issuer Rating” as used herein and for purposes of the above shall mean the lowest CleanPowerSF issuer rating assigned by any Rating Agency then providing a CleanPowerSF issuer rating, or (if there is no CleanPowerSF issuer rating assigned by such Rating Agency), the lowest credit rating on long-term unenhanced CleanPowerSF Program Debt assigned by any Rating Agency then providing a credit rating on long- term unenhanced CleanPowerSF Program Debt (for the avoidance of doubt, Level 5 is the lowest Level, and Level 1 is the highest Level for purposes of the pricing grids). In the event of a split rating ( i.e., the Applicable Issuer Rating of one of the Rating Agencies is at a different level than the Applicable Issuer Rating of any other Rating Agency), the Undrawn Fee Rate, LC Facility Fee Rate and Applicable Rate shall be based upon the Level in which the lowest Applicable Issuer Ratings appears. References to ratings above are references to rating categories as presently determined by the Rating Agencies, and in the event of adoption of any new or changed rating system by any such Rating Agency, including, without limitation, any recalibration of the ratings in connection with the adoption of a “global” rating scale, each of the ratings from the Rating Agency in question referred to above shall be deemed to refer to the rating category under the new rating system which most closely approximates the applicable rating category as currently in effect. The Commission and the Bank acknowledge that as of the Amendment Date, the Undrawn Fee Rate, LC Facility Fee Rate and Applicable Rate is that specified for Level 1 of the pricing grid set forth under paragraph (ii) above.
In the event that any rat ing that may be used to determine the Applicable Issuer Rating is suspended, withdrawn or otherwise unavailable from a Rating Agency except to the extent that the applicable Rating Agency has stated in writing that such suspension, withdrawal or other unavailability is not for a credit-related reason or upon the occurrence and during the continuance of an Event of Default , the Undrawn Fee Rate shall increase by 1.00% per annum from the Undrawn Fee Rate in effect on the date of the occurrence of such suspension, withdrawal or unavailability and such increase shall remain in effect until such time as the Applicable Issuer 3 Rating is no longer suspended, withdrawn or otherwise unavailable or until the Event of Default has been waived in accordance with the Agreement , as applicable. In the event any Applicable Issuer Rating falls below Level 5 or upon the occurrence and during the continuance of any Event of Default, the LC Facility Fee Rate and the Applicable Rate shall increase by 3.00% from the rate for the Level that is otherwise then in effect. Any change in the Undrawn Fee Rate resulting from a change in the Applicable Issuer Rating or any of the other events described in this paragraph shall be and become effective as of and on the date of the announcement of the change in the Applicable Issuer Rating or the occurrence of any such other event.
Section 1.2 Letter of Credit Fees . The Commission agrees to pay to the Bank, in immediately available funds, for the period from and including the date of issuance of each Letter of Credit to but excluding the date such Letter of Credit is terminated (the “ LC Termination Date”), in arrears on t he first Business Day of each April, July, October and January occurring after the date of issuance of each Letter of Credit to and including the LC Termination Date, and on the LC Termination Date (each, a “ LC Payment Date”), a non- refundable undrawn fee (the “LC Facility Fee”) in an amount equal for each day during such calculation period to the product of (x ) the rate per annum associated with the Applicable Issuer Rating as specified for the applicable Level under the column captioned “LC Facility Fee Rate” in the applicable pricing grid set forth in Section 1.1 above (the “LC Facility Fee Rate”) and in effect on such day, (y) the stated amount of such Letter of Credit as of 5:00 p.m. New York City time on such day and (z) a fraction the numerator of which is 1 and denominator of which is 360; provided, however , upon the occurrence and during the continuance of any Event of Default or if any rating that may be used to determine the Applicable Issuer Rating is suspended, withdrawn or otherwise unavailable from a Rating Agency except to the extent that the applicable Rating Agency has stated in writing that such suspension, withdrawal or other unavailability is not for a credit -related reason , the LC Facility Fee Rate shall increase by 3.00% from the rate that is otherwise then in effect.
For purposes of calculating the LC Facility Fee from and including one Payment Date (or, in the case of the first LC Facility Fee payment in respect of the Letters of Credit outstanding on the Amendment Date, from and including the Amendment Date) to but excluding the next LC Payment Date, any change in the LC Facility Fee Rate resulting from a change in the Applicable Issuer Rating or any of the other events described in this Section 1.2 shall be and become effective as of and on the date of the announcement of the change in the Applicable Issuer Rating or the occurrence of any such other event. The Bank shall provide the Commission with an invoice for each LC Facility Fee; provided, however, that the failure of the Bank to do so shall not relieve the Commission from its obligation to pay such LC Facility Fee.
Section 1.3 Drawing Fees. The Commission agrees to pay to the Bank a non-refundable drawing fee of $500 for each drawing under a Letter of Credit, which fee shall be earned on the drawing date and shall be payable upon invoice on the next LC Payment Date (or, if there is no further LC Payment Date, the LC Termination Date).
Section 1.4 Amendment, Waiver or Consent Fees . The Commission agrees to pay to the Bank on the date on which the Commission requests from the Bank (i ) an amendment, supplement or modification to the Agreement or any other Basic Document, (ii ) a consent under, or a waiver of any provision of, the Agreement or any other Basic Document or (iii ) the transfer 4 of any Letter of Credit, a non- refundable fee to be determined by the Bank at the time of such amendment, supplement or modification or waiver or consent or transfer, but in any event at a minimum of $3,000, plus, in each case, the reasonable fees and expenses of legal counsel to the Bank.
Section 1.5 [Reserved].
Section 1.6 Applicable Rate. As used in the Agreement and this Fee Agreement, the “Applicable Rate” means the rate per annum associated with the Applicable Issuer Rating as specified for the applicable Level under the column captioned “Applicable Rate” in the applicable pricing grid set forth in Section 1.1 above; provided, however, upon the occurrence and during the continuance of any Event of Default or if any rating that may be used to determine the Applicable Issuer Rating is suspended, withdrawn or otherwise unavailable from a Rating Agency except to the extent that the applicable Rating Agency has stated in writing that such suspension, withdrawal or other unavailability is not for a credit -related reason, the Applicable Rate shall increase by
3.00% from the rate that is otherwise then in effect. Any change in the Applicable Rate resulting from a change in the Applicable Issuer Rating or any of the other events described in this paragraph shall be and become effective as of and on the date of the announcement of the change in the Applicable Issuer Rating or the occurrence of any such other event.
Article II M
ISCELLANEOUS.
Section 2.1 Legal Fees. The Commission shall pay the reasonable legal fees and expenses of the Bank incurred in connection with the preparation and negotiation of the Fourth Amendment to Credit Agreement dated as of the date hereof, between the Bank and the Commission, this Fee Agreement and certain other Basic Documents in an amount not to exceed $[_____] plus disbursements.
Section 2.2 Amendments . No amendment to this Fee Agreement will become effective without the prior consent of the Commission and the Bank, which consent must be in writing and signed by the Bank and an Authorized Representative of the Commission.
Section 2.3 Governing Law . This Fee Agreement shall be deemed to be a contract under, and for all purposes shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without giving effect to conflicts of laws provisions (other than New York general obligations laws 5- 1401 and 5-1402); provided, that the obligations of the Commission hereunder shall be governed by the laws of the State of California without regard to choice of law rules.
Section 2.4 Counterparts . This Fee Agreement may be executed in two or more counterparts, each of which will constitute an original but both or all of which, when taken together, will constitute but one instrument. This Fee Agreement may be delivered by the exchange of signed signature pages by facsimile transmission or by attaching a pdf copy to an email, and any printed or copied version of any signature page so delivered will have the same force and effect as an originally signed version of such signature page. 5 Section 2.5 Severability. Any provision of this Fee Agreement which is prohibited, unenforceable or not authorized in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability or non- authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability or legality of such provision in any other jurisdiction.
Section 2.6. Amendment and Restatement. This Fee Agreement amends and restates in its entirety the Existing Fee Agreement but is not intended to be or operate as a novation or an accord and satisfaction of the Existing Fee Agreement or the obligations and liabilities of the Commission evidenced or provided for thereunder. The parties hereto agree that this Fee Agreement does not extinguish or discharge the obligations of the Commission or the Bank under the Existing Fee Agreement. Reference to this specific Fee Agreement need not be made in any agreement, document, instrument, letter, certificate, the Existing Fee Agreement itself, or any communication issued or made pursuant to or with respect to the Existing Fee Agreement , any reference to the Fee Agreement being sufficient to refer to the Existing Fee Agreement as amended and restated hereby, and more specifically, any and all references to the Fee Agreement in the Agreement shall mean this Fee Agreement.
[SIGNATURE PAGES TO FOLLOW]
Signature Page to SFPUC CleanPowerSF Second Amended and Restated Fee Agreement IN WITNESS WHEREOF, the parties hereto have caused this Fee Agreement to be duly executed and delivered by their respective officers or representatives thereunto duly authorized on the date first set forth above.
PUBLIC UTILITIES COMMISSION OF THE
CITY AND COUNTY OF SAN FRANCISCO
By:
Name: Dennis J. Herrera
Title: General Manager
APPROVED AS TO FORM:
DAVID CHIU
City Attorney of the City and
County of San Francisco
By:
Name: Katherine Thursby Ortega
Title: Deputy City Attorney
ACKNOWLEDGED:
By:
Name: Anna Van Degna
Title: Director of Public Finance of the
City and County of San Francisco
Signature Page to SFPUC CleanPowerSF Second Amended and Restated Fee Agreement
JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION
By: ____________________________________
Name: Heather Talbott
Title: Executive Director