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Securities and Exchange Commission
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 13, 1997
CalEnergy Company, Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-9874 94-2213782
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
302 South 36th Street, Suite 400, Omaha, NE 68131
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (402) 341-4500
N/A
(Former name or former address, if changed since last report)
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Item 5. Other Events.
On October 14, 1997 the Registrant announced the pricing of its public offering
of common stock, par value $.0675. A press release with respect to the pricing
of such offering is attached as Exhibit 99.2. Pursuant to such offering, on
October 13, 1997, the Registrant entered into an Underwriting Agreement and a
Subscription Agreement (each as referred to below). In addition, the Registrant
concurrently entered into a Purchase Agreement (referred to below) with respect
to a direct sale of 2 million shares of its common stock. Copies of such
agreements are attached hereto as Exhibits 1.3, 1.4 and 99.1
Item 7. Financial Statements and Exhibits.
(c) Exhibits:
The following exhibits are filed as part of this report
1.3 Underwriting Agreement, dated October 13, 1997, among the
Company and Credit Suisse First Boston Corporation, Lehman
Brothers Inc., Donaldson, Lufkin & Jenrette Securities
Corporation and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as representatives of the underwriters named
therein.
1.4 Subscription Agreement, dated October 13, 1997, among the
Company and Credit Suisse First Boston (Europe) Limited and
Lehman Brothers International (Europe), as representatives of
the managers named therein.
99.1 Purchase Agreement, dated October 13, between the Company
and Walter C. Scott, Jr.
99.2 Press Release of the Company, dated October 14, 1997.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CalEnergy Company, Inc.
By: /s/ Douglas L. Anderson
Douglas L. Anderson
Assistant Secretary and
Assistant General
Counsel
Dated: October 16, 1997
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CalEnergy Company, Inc.
By: /s/ Douglas L. Anderson
Douglas L. Anderson
Assistant Secretary and Assistant
General Counsel
Dated: October 16, 1997
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Exhibit Index
Exhibit No. Description
- ----------- -----------
1.3 Underwriting Agreement, dated October 13, 1997, among the
Company, Credit Suisse First Boston Corporation, Lehman
Brothers Inc., Donaldson, Lufkin & Jenrette Securities
Corporation and Merrill Lynch, Pierce, Fenner & Smith
Incorporated.
1.4 Subscription Agreement, dated October 13, 1997, among the
Company, Credit Suisse First Boston (Europe) Limited and
Lehman Brothers International (Europe).
99.1 Purchase Agreement, dated October 13, among the Company and
Walter C. Scott, Jr.
99.2 Press Release of the Company, dated October 14, 1997.
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15,000,000 Shares
CALENERGY COMPANY, INC.
Common Stock
UNDERWRITING AGREEMENT
----------------------
October 13, 1997
Credit Suisse First Boston Corporation
Lehman Brothers Inc.
Donaldson, Lufkin & Jenrette
Securities Corporation
Merrill Lynch, Pierce, Fenner & Smith Incorporated
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Dear Sirs:
1. Introductory. CalEnergy Company, Inc., a Delaware corporation
("Company"), proposes to issue and sell ("U.S. Offering") to the several
Underwriters named in Schedule A hereto ("Underwriters") 10,500,000 shares
("U.S. Firm Securities") of its Common Stock, par value $.0675 per share
("Securities").
It is understood that the Company is concurrently entering into a
Purchase Agreement, dated the date hereof ("Purchase Agreement"), with Walter C.
Scott, Jr., Chairman and President of Peter Kiewit Sons', Inc, and/or certain
affiliated trusts and other entities directly or indirectly related to Mr.
Scott, relating to the concurrent sale of 2,000,000 shares of Securities
("Direct Sale").
It is understood that the Company is concurrently entering into a
Subscription Agreement, dated the date hereof ("Subscription Agreement"), with
Credit Suisse First Boston (Europe) Limited ("CSFBL"), Lehman Brothers
International (Europe), ABN AMRO Rothschild, HSBC Investment Bank Plc and UBS
Limited, and the other managers named therein ("Managers") relating to the
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concurrent offering and sale of 4,500,000 shares of Securities ("International
Firm Securities") outside the United States and Canada ("International
Offering").
In addition, the Company proposes to issue and sell to the Underwriters
and the Managers an option exercisable by Credit Suisse First Boston Corporation
("CSFBC") for an aggregate of not more than 2,100,000 additional shares of
Securities ("Optional Securities"; the Optional Securities for the offering in
the United States and Canada are referred to as the "U.S. Optional Securities"
and the Optional Securities for the International Offering are referred to as
the "International Optional Securities"). The U.S. Firm Securities and the U.S.
Optional Securities are hereinafter called the "U.S. Securities"; the
International Firm Securities and the International Optional Securities are
hereinafter called the "International Securities"; and the U.S. Firm Securities
and the International Firm Securities are hereinafter called the "Firm
Securities". The U.S. Securities and the International Securities are
collectively referred to as the "Offered Securities". To provide for the
coordination of their activities, the Underwriters and the Managers have entered
into an Agreement Between U.S. Underwriters and Managers which permits them,
among other things, to sell the Offered Securities to each other for purposes of
resale.
The Company hereby agrees with the several Underwriters as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement on Form S-3 (No. 333-32821), including a
form of prospectus relating to certain debt and equity securities
("Registered Securities") to be issued from time to time by the Company, has
been filed with the Securities and Exchange Commission ("Commission") and
has been declared effective under the Securities Act of 1933, as amended
("Act"). The Company proposes to file with the Commission pursuant to Rule
424 under the Act a form of prospectus supplement specifically relating to
the U.S. Securities and a form of prospectus supplement specifically
relating to the International Securities. The registration statement, as
amended at the time of this Agreement, including all material incorporated
by reference therein, is hereinafter referred to as the "Registration
Statement," and the form of prospectus included in such Registration
Statement, as supplemented by the prospectus supplement specifically
relating to the U.S. Securities and the form of prospectus included in such
Registration Statement, as supplemented by the prospectus supplement
specifically relating to the International Securities, in each case as first
filed with the Commission pursuant to and in accordance with Rule 424(b)
("Rule 424(b)") under the Act, including all material incorporated by
reference therein, are hereinafter referred to as the "U.S. Prospectus" and
the "International Prospectus", respectively, and collectively as the
"Prospectuses". No document has been or will be prepared or distributed in
reliance on Rule 434 under the Act.
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(b) On the effective date of the registration statement relating to the
Registered Securities, such registration statement conformed in all material
respects to the requirements of the Act and the rules and regulations of the
Commission ("Rules and Regulations") thereunder and did not include any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and on the date of this Agreement, the Registration
Statement conforms, and at the time of filing of each of the Prospectuses
pursuant to Rule 424(b), the Registration Statement and each of the
Prospectuses will conform, in all material respects to the requirements of
the Act and the Rules and Regulations, and none of such documents includes,
or will include, any untrue statement of a material fact or omits, or will
omit, to state any material fact required to be stated therein or necessary
to make the statements therein (with respect to the Prospectuses, in the
light of the circumstances under which they were made) not misleading,
except that the foregoing does not apply to statements in or omissions from
the Registration Statement or either of the Prospectuses based upon written
information furnished to the Company by or on behalf of any Underwriter
through the Representatives or by or on behalf of any Manager through CSFBL
specifically for use therein, it being understood and agreed that the only
such information is that described as such in Section 7(b).
(c) The documents incorporated by reference in the Registration
Statement and the Prospectuses, when they became effective or were last
amended or filed with the Commission, as the case may be, conformed in all
material respects to the requirements of the Act or the Securities Exchange
Act of 1934, as amended ("Exchange Act"), as applicable, and the Rules and
Regulations, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in light
of the circumstances under which they were made, and any further documents
so filed and incorporated by reference in the Registration Statement and the
Prospectuses, when such documents become effective or are filed with the
Commission, as the case may be, shall conform in all material respects to
the
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requirements of the Act and the Exchange Act as applicable, and the Rules
and Regulations and shall not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances
under which they were made.
(d) The Company, each Subsidiary (as defined below) and each Joint
Venture (as defined below) have been duly organized and are validly existing
and, if applicable, in good standing under the laws of their respective
jurisdictions of organization as a corporation, limited liability company or
partnership, as the case may be, and have the power and authority to own,
lease and operate their property and conduct their businesses as described
in the Prospectuses; the Company, the Subsidiaries and the Joint Ventures
are duly qualified to do business and are in good standing as foreign
corporations or foreign partnerships, as the case may be, in each
jurisdiction, domestic or foreign, in which such registration or
qualification or good standing is required (whether by reason of the
ownership or leasing of property, the conduct of business or otherwise),
except where the failure to so register or qualify or be in good standing is
not reasonably likely to have a material adverse effect on the financial
condition, business or results of operations of the Company, the
Subsidiaries and the Joint Ventures taken as a whole. For purposes of this
Agreement, (A) the term "Subsidiary" shall mean the entities listed in
Schedule B hereto ("Schedule B") and (B) the term "Joint Venture" shall mean
the entities listed in Schedule C hereto ("Schedule C"), it being understood
that such term means the general or limited partnership or other joint
venture entity and not the individual general or limited partners or other
joint venturers thereof. The Subsidiaries listed in Schedule B are all the
material direct and indirect "subsidiaries" of the Company, as such term is
defined in Rule 405 of the Rules and Regulations, and are all of the
"Significant Subsidiaries" of the Company, as such term is defined in Rule
1-02 of Regulation S-X.
(e) All the outstanding shares of capital stock of each Subsidiary have
been duly and validly authorized and issued and are fully-paid and
nonassessable; and except as otherwise set forth in Schedule B or disclosed
in or contemplated by the Prospectuses, all outstanding shares of capital
stock of each Subsidiary are owned beneficially by the Company free and
clear of any
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material claims, liens, encumbrances and security interests. All of the
partnership interests in the Joint Ventures beneficially owned by the
Company (as reflected in Schedule C) have been duly and validly authorized
and issued and, except as otherwise set forth in Schedule C or disclosed in
or contemplated by the Prospectuses, are owned beneficially by the Company
free and clear of any material claims, liens, encumbrances and security
interests.
(f) The Firm Securities and any Optional Securities and all other
outstanding shares of capital stock of the Company have been duly
authorized; all outstanding shares of capital stock of the Company are, and,
when the Offered Securities have been delivered and paid for in accordance
with this Agreement and the Subscription Agreement on each Closing Date (as
defined below), such Offered Securities will have been, validly issued,
fully paid and nonassessable and will conform to the description thereof
contained in the Prospectuses; and the stockholders of the Company have no
preemptive rights with respect to the Offered Securities which have not been
waived.
(g) The use of the proceeds of the offering of the Offered Securities
as described in the Prospectuses has been duly authorized by all necessary
action on the part of the Company.
(h) Except as disclosed in the Prospectuses, there are no contracts,
agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter or Manager
for a brokerage commission, finder's fee or other like payment in connection
with the offering of the Offered Securities.
(i) Except as disclosed in the Prospectuses, there are no contracts,
agreements or understandings which have not been satisfied or waived between
the Company and any person requiring the Company to include securities of
the Company owned or to be owned by such person in the securities registered
pursuant to the Registration Statement.
(j) The outstanding shares of Common Stock are listed on The New York
Stock Exchange (the "Stock Exchange") and the Offered Securities have been
approved for listing on the Stock Exchange, subject to notice of issuance.
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(k) The execution, delivery and performance of this Agreement and the
Subscription Agreement, and the issuance and sale of the Offered Securities
and the use of the proceeds of the offering of the Offered Securities as
described in the Prospectuses, will not (A) conflict with the corporate
charter or by-laws or partnership agreement of the Company, any Subsidiary
or any Joint Venture, (B) conflict with, result in the creation or
imposition of any lien, charge or other encumbrance upon any asset of the
Company, any Subsidiary or any Joint Venture pursuant to the terms of, or
constitute a breach of, or default under, any agreement, indenture or other
instrument to which the Company, any Subsidiary or any Joint Venture is a
party or by which the Company, any Subsidiary or any Joint Venture is bound
or to which any of the properties of the Company, any Subsidiary or any
Joint Venture is subject, or (C) result in a violation of any statute, rule,
regulation, order, judgment or decree of any court or governmental agency,
body or authority having jurisdiction over the Company, any Subsidiary or
any Joint Venture or any of their properties where any such conflicts,
encumbrances, breaches, defaults or violations under clauses (B) or (C),
individually or in the aggregate, is reasonably likely to (i) have a
material adverse effect on the financial condition, business or results of
operations of the Company, the Subsidiaries and the Joint Ventures taken as
a whole or (ii) impair the validity or enforceability of the Offered
Securities under the Act.
(l) Except (A) as to state or foreign securities laws and (B) consents
of third parties which have been obtained, no consent, approval,
authorization or order of, or filing or registration by the Company, any
Subsidiary or, to the best of the Company's knowledge, any Joint Venture
with, any court, governmental agency or third party is required for the
consummation of the transactions contemplated by this Agreement and the
Subscription Agreement in connection with the issuance and sale of the
Offered Securities by the Company and the use of the proceeds of the
offering of the Offered Securities as described in the Prospectuses.
(m) The Company has full power and authority to authorize, issue and
sell the Offered Securities as contemplated by this Agreement and the
Subscription Agreement, respectively.
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(n) This Agreement and the Subscription Agreement have each been duly
authorized, executed and delivered by the Company.
(o) Except as disclosed in or contemplated by the Prospectuses, the
Company, each Subsidiary and each Joint Venture holds, as applicable, good
and valid title to, or valid and enforceable leasehold or contractual
interests in, all real properties and all other properties and assets owned
or leased by or held under contract by each of them that are material to the
business of the Company, the Subsidiaries and the Joint Ventures taken as a
whole, and free from liens, encumbrances and defects that would materially
interfere with the use made or to be made thereof by them.
(p) Except as disclosed in or contemplated by the Prospectuses, the
Company, the Subsidiaries and the Joint Ventures carry, or are covered by,
insurance in such amounts and covering such risks as is customary for
similarly situated companies in the Company's, such Subsidiaries' and such
Joint Ventures' industries, respectively. Each of the foregoing insurance
policies is valid and in full force and effect, and no event has occurred
and is continuing that permits, or after notice or lapse of time or both
would permit, modifications or terminations of the foregoing that,
individually or in the aggregate, is reasonably likely to have a material
adverse effect on the financial condition, business or results of operations
of the Company, the Subsidiaries and the Joint Ventures taken as a whole.
(q) Except as disclosed in or contemplated by the Prospectuses, the
Company, each Subsidiary and each Joint Venture (i) has obtained each
license, permit, certificate, franchise or other governmental authorization
which is material to the ownership of their properties or to the conduct of
their businesses as described in or contemplated by the Prospectuses and
(ii) is in compliance with all terms and conditions of such license, permit,
certificate, franchise or other governmental authorization, except (A) in
either case where the failure to do so is not reasonably likely to have,
individually or in the aggregate, a material adverse effect on the financial
condition, business or results of operations of the Company, the
Subsidiaries and the Joint Ventures taken as a whole, (B) permits, consents
and approvals that may be required for future drilling or operating
activities which are ordinarily deemed to be ministerial in nature and which
are anticipated to be obtained in the ordinary course and (C) permits,
consents and approvals for
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developmental or construction activities which have not yet been obtained
but which have been or will be applied for in the course of development or
construction and which are anticipated to be obtained in the ordinary
course.
(r) Except as disclosed in the Prospectuses, there are no legal or
governmental actions, suits or proceedings before any court, governmental
agency, body or authority, domestic or foreign, now pending or, to the
knowledge of the Company, threatened against, or, to the knowledge of the
Company, involving, the Company, any Subsidiary or any Joint Venture (i) of
a character required to be disclosed in the Registration Statement which is
not adequately disclosed in the Registration Statement or (ii) that, if
determined adversely to the Company, any Subsidiary or any Joint Venture,
would be reasonably likely to have, individually or in the aggregate, a
material adverse effect on the financial condition, business or results of
operations of the Company, the Subsidiaries and the Joint Ventures taken as
a whole, or on the ability of the Company to perform its obligations under
this Agreement or the Subscription Agreement, or which are otherwise
material in the context of the sale of the Offered Securities.
(s) The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
(t) The Company, the Subsidiaries and the Joint Ventures are currently
conducting their respective businesses as described in the Prospectuses.
(u) There are no contracts or documents of a character required to be
described in the Registration Statement or Prospectuses or to be filed as
exhibits to the Registration Statement which are not described or filed as
required under the Act.
(v) There is no relationship, direct or indirect, that exists between
or among the Company on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company on the other hand, of a
character required to be described in the Registration Statement or
Prospectuses which is not described as required under the Act.
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(w) There is no labor problem or disturbance with the persons employed
by the Company, any Subsidiary or any Joint Venture that exists or, to the
knowledge of the Company, that is threatened and that might reasonably be
expected to have a material adverse effect on the financial condition,
business or results of operations of the Company, the Subsidiaries and the
Joint Ventures taken as a whole.
(x) Neither the Company nor any person who is a member of a group which
is under common control with the Company and the Subsidiaries and the Joint
Ventures, who together with the Company, the Subsidiaries and the Joint
Ventures is treated as a single employer ("ERISA Affiliate") within the
meaning of Section 414(b), (c), (m) or (o) of the Internal Revenue Code of
1986, as amended from time to time (the "Code"), or Section 4001(b) of the
Employee Retirement Income Security Act of 1974, as amended from time to
time ("ERISA"), has established, sponsored, maintained or had any obligation
to contribute to any employee benefit plans within the meaning of Section
3(3) of ERISA which are subject to Title IV of ERISA or Section 412 of the
Code. Except where it could not reasonably be expected to result in a
material adverse effect on the financial condition, business or results of
operations of the Company, the Subsidiaries and the Joint Ventures taken as
a whole, (i) all employee benefit plans within the meaning of Section 3(3)
of ERISA established, sponsored or maintained for or on behalf of the
employees, officers or directors of the Company, the Subsidiaries, the Joint
Ventures or any ERISA Affiliate ("Employee Benefit Plans") are in compliance
with all applicable provisions of ERISA and the Code and the regulations and
published interpretations thereunder and each such Employee Benefit Plan
that is intended to be qualified under Code Section 401(a) has been
determined by the Internal Revenue Service to be so qualified and (ii) no
material liability or obligation has been incurred or is reasonably expected
to be incurred by the Company, the Subsidiaries or the Joint Ventures or any
ERISA Affiliate with respect to any Employee Benefit Plan.
(y) None of the Company, any Subsidiary or any Joint Venture (i) is in
violation of its respective charter, by-laws or partnership agreements, (ii)
is in default, and no event exists and is continuing that, with notice or
lapse of time or both, would constitute such a default, in the due
performance and observance of any material term contained in any lease,
license, indenture, mortgage, deed of trust, note, bank loan or other
evidence of indebtedness or
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any other agreement, understanding or instrument to which the Company, any
Subsidiary or any Joint Venture is a party or by which the Company, any
Subsidiary or any Joint Venture or any property of the Company, any
Subsidiary or any Joint Venture may be bound or affected, which default,
individually or in the aggregate, is reasonably likely to have a material
adverse effect on the financial condition, business or results of operations
of the Company, the Subsidiaries and the Joint Ventures taken as a whole, or
(iii) is in violation of any law, ordinance, governmental rule or regulation
or court decree to which it may be subject, which violation, individually or
in the aggregate, is reasonably likely to have a material adverse effect on
the financial condition, business or results of operations of the Company,
the Subsidiaries and the Joint Ventures taken as a whole or would materially
interfere with the execution, delivery and performance of this Agreement, or
the Subscription Agreement, the issuance and sale of the Offered Securities
or the use of the proceeds of the offering of the Offered Securities as
described in the Prospectuses.
(z) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, hazardous
wastes or hazardous substances, pollutants or contaminants by the Company,
any Subsidiary or any Joint Venture (or, to the knowledge of the Company,
any of their predecessors in interest) at, upon or from any of the property
now or previously owned or leased by the Company, any Subsidiary or any
Joint Venture in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would require
remedial action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or remedial
action which does not have, or would not be reasonably likely to have,
individually or in the aggregate with all such violations and remedial
actions, a material adverse effect on the financial condition, business or
results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole; there has been no material spill, discharge,
leak, emission, injection, escape, dumping or release of any kind onto such
property or into the environment surrounding such property of any toxic
wastes, solid wastes, hazardous wastes or hazardous substances, pollutants
or contaminants due to or caused by the Company, any Subsidiary or any Joint
Venture or with respect to which the Company, any Subsidiary or any Joint
Venture has knowledge, except for any such spill, discharge, leak, emission,
injection, escape, dumping or release which does not have, or
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would not be reasonably likely to have, individually or in the aggregate
with all such spills, discharges, leaks, emissions, injections, escapes,
dumpings and releases, a material adverse effect on the financial condition,
business or results of operations of the Company, the Subsidiaries and the
Joint Ventures taken as a whole; and the terms "hazardous wastes", "toxic
wastes" and "hazardous substances" shall have the meanings specified in any
applicable local, state, federal and foreign laws or regulations with
respect to environmental protection.
(aa) None of the Company or any Subsidiary or any Joint Venture is an
open-end investment company, unit investment trust or face-amount
certificate company that is or is required to be registered under Section 8
of the United States Investment Company Act of 1940, as amended (the "1940
Act"), nor is it a closed-end investment company required to be registered,
but not registered, thereunder; and each of the Company, each Subsidiary and
each Joint Venture is not and, after giving effect to the offering and sale
of the Offered Securities and the application of the proceeds thereof as
described in the Prospectuses, will not be an "investment company", or, to
the best knowledge of the Company after due inquiry, a company controlled by
an "investment company" within the meaning of the 1940 Act.
(bb) The Company, each Subsidiary and each Joint Venture has filed all
federal, state and local income and franchise tax returns required to be
filed through the date hereof, or has filed extensions in accordance with
applicable law, and has paid all taxes required to be paid through the date
hereof thereon, except for such failures to file or pay that would not,
individually or in the aggregate, be reasonably likely to have a material
adverse effect on the financial condition, business or results of operations
of the Company, the Subsidiaries and the Joint Ventures taken as a whole,
and no tax deficiency has been determined adversely to the Company, any
Subsidiary or any Joint Venture that has had (nor does the Company have any
knowledge of any tax deficiency which, if determined adversely to the
Company, any Subsidiary or any Joint Venture would be reasonably likely to
have) a material adverse effect on the financial condition, business or
results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole.
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(cc) The financial statements and the related notes and schedules
included or incorporated by reference in the Registration Statement and the
Prospectuses fairly present the financial position, the results of
operations and the cash flows of the Company and its consolidated
subsidiaries at the respective dates and for the respective periods to which
they apply; and such financial statements and the related notes and
schedules have been prepared in conformity with United States generally
accepted accounting principles applied on a consistent basis throughout the
periods therein specified. The historical information under the caption
"Capitalization" in the Prospectuses is accurately described as of the date
presented therein.
(dd) Since the date of the latest financial statements included or
incorporated by reference in the Prospectuses (i) there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the financial condition, business or results of
operations of the Company, the Subsidiaries and the Joint Ventures taken as
a whole, and (ii) except as disclosed in or contemplated by the
Prospectuses, there have not been any transactions entered into by the
Company, the Subsidiaries or any Joint Venture, other than those in the
ordinary course of business, which are material to the Company, the
Subsidiaries and the Joint Ventures taken as a whole; and, except as
disclosed in the Prospectuses, there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital
stock.
(ee) The pro forma financial information included in the Registration
Statement and the Prospectuses presents fairly the information shown
therein, has been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial information, has been
properly compiled on the pro forma bases described therein, and, in the
opinion of the Company, the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give effect
to the transactions or circumstances referred to therein.
(ff) The accountants who have certified certain financial statements of
the Company or of businesses acquired by the Company, as applicable, and
whose reports appear in the Registration Statement and the Prospectuses or
are incorporated by reference therein, are and were independent public
accountants as required by the Act and the Rules and Regulations during the
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periods covered by the financial statements on which they reported which are
contained or incorporated by reference in the Registration Statement or the
Prospectuses.
(gg) (i) Each of the operational electric generation facilities
("Plants") owned in whole or in part, directly or indirectly by (A) the
Company, (B) the Subsidiaries or (C) the Joint Ventures which is located in
the United States is a "qualifying cogeneration facility" or a "qualifying
small power production facility" (either or both of which are hereinafter
referred to as a "QF"), as such terms are defined under the Federal Power
Act, as amended ("FPA"), and the regulations thereunder, and has
continuously been in compliance with the requirements for being a QF since
it commenced sales of electricity; (ii) with respect to each Plant under
development and located in the United States, either (x) to the extent that
the Company, the Subsidiaries or the Joint Ventures plan to act as the owner
and/or operator of any one of the Plants under development by the Company,
the Subsidiaries or the Joint Ventures and located in the United States (as
currently configured or as currently anticipated to be configured), that
owner and/or operator satisfies or is currently expected to satisfy current
regulatory requirements for being an "exempt wholesale generator" ("EWG"),
as such term is defined under the FPA, the Public Utility Holding Company
Act of 1935, as amended ("PUHCA") and the regulations thereunder or (y) each
of the Plants under development by the Company, the Subsidiaries or the
Joint Ventures and located in the United States (as currently configured or
as currently anticipated to be configured) will be a QF and will be in
continuous compliance with the requirements for being a QF; (iii) the owner
or operator of each of the Plants under development by the Company, the
Subsidiaries or the Joint Ventures and located outside the United States (as
currently configured or as currently anticipated to be configured) satisfies
or is currently expected to satisfy current regulatory requirements for
being either (A) an EWG or (B) a "foreign utility company," as such term is
defined under PUHCA and the regulations thereunder; (iv) none of the
entities identified in clause (A) or (B) of subparagraph (i) above owns or
operates or will own or operate any electric distribution facilities or any
electric transmission facilities in or outside of the United States other
than electric transmission facilities that have been or will be approved by
the Federal Energy Regulatory Commission as being part of a QF, or the owner
and/or operator of which will have qualified as EWG's or as "foreign utility
companies" as such terms are defined under the FPA,
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PUHCA and the regulations thereunder; and (v) none of the entities
identified in clause (A), (B) or (C) of subparagraph (i) above is, or is
subject to regulation as, a "public utility holding company" or a
"subsidiary company" of a "public utility holding company," as those terms
are defined under PUHCA, or is subject to regulation under the FPA, other
than as contemplated by 18 C.F.R Section 292.601(c), or, except as described
in or contemplated by the Prospectuses, subject to regulation by any state
law or foreign governmental law with respect to rates or the financial or
organizational regulation of electric utilities.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $36.645 per share, the respective
number of shares of U.S. Firm Securities set forth opposite the names of the
Underwriters in Schedule A hereto.
The Company will deliver the U.S. Firm Securities to the
Representatives for the accounts of the Underwriters, against payment of the
purchase price in Federal (same day funds) by official bank check or checks or
wire transfer to an account at a bank acceptable to CSFBC drawn to the order of
CalEnergy Company, Inc. at the offices of Skadden, Arps, Slate, Meagher & Flom
LLP, 919 Third Avenue, New York, New York, at 10:00 A.M., New York time, on
October 17, 1997 or at such other time not later than seven full business days
thereafter as CSFBC and the Company determine, such time being herein referred
to as the "First Closing Date". For purposes of Rule 15c6-1 under the Exchange
Act, the First Closing Date (if later than the otherwise applicable settlement
date) shall be the settlement date for payment of funds and delivery of
securities for all the U.S. Firm Securities sold pursuant to the offering. The
certificates for the U.S. Firm Securities so to be delivered will be in
definitive form, in such denominations and registered in such names as CSFBC
requests and will be made available for checking and packaging at the office of
CSFBC, at the address set forth on the first page hereof, at least 24 hours
prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the
Company from time to time not more than 30 days subsequent to the date of the
initial public
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<PAGE>
offering of the Offered Securities, the Underwriters and the Managers may
purchase all or less than all of the Optional Securities at the purchase price
per Security to be paid for the Firm Securities. The U.S. Optional Securities to
be purchased by the Underwriters on any Optional Closing Date (as defined below)
shall be in the same proportion to all the Optional Securities to be purchased
by the Underwriters and the Managers on such Optional Closing Date as the U.S.
Firm Securities bear to all the Firm Securities and the International Optional
Securities to be purchased by the Managers on any Optional Closing Date shall be
in the same proportion to all the Optional Securities to be purchased by the
Underwriters and the Managers on such Optional Closing Date as the International
Firm Securities bear to all the Firm Securities. The Company agrees to sell to
the Underwriters such U.S. Optional Securities specified in such notice and the
Underwriters agree, severally and not jointly, to purchase such U.S. Optional
Securities. The U.S. Optional Securities shall be purchased for the account of
each Underwriter in the same proportion as the number of shares of U.S. Firm
Securities set forth opposite such Underwriter's name bears to the total number
of shares of U.S. Firm Securities (subject to adjustment by CSFBC to eliminate
fractions). The Optional Securities may be purchased by the Underwriters and the
Managers only for the purpose of covering over-allotments made in connection
with the sale of the Firm Securities. No Optional Securities shall be sold or
delivered unless the related Firm Securities previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CSFBC on behalf of the Underwriters and the Managers to the
Company.
Each time for the delivery of and payment for the U.S. Optional
Securities, being herein referred to as an "Optional Closing Date", which may be
the First Closing Date (the First Closing Date and each Optional Closing Date,
if any, being sometimes referred to as a "Closing Date"), shall be determined by
CSFBC but shall be not later than seven full business days after written notice
of election to purchase Optional Securities is given. The Company will deliver
the U.S. Optional Securities being purchased on each Optional Closing Date to
the Representatives for the accounts of the several Underwriters, against
payment of the purchase price therefor in Federal (same day) funds by official
bank check or checks or wire transfer to an account at a bank acceptable to
CSFBC drawn to the order of CalEnergy Company, Inc., at the above office of
Skadden, Arps, Slate, Meagher & Flom LLP. The certificates for the U.S. Optional
Securities will be in definitive form, in such denominations and registered in
such names as CSFBC requests upon reasonable
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<PAGE>
notice prior to such Optional Closing Date and will be made available for
checking and packaging at the above office of CSFBC, at a reasonable time in
advance of such Optional Closing Date.
In connection with the shares sold in the Direct Sale, the Company will
pay or cause to be paid to the Joint Book Running Managers for the U.S. Offering
underwriting discounts and commissions in an amount per Security purchased in
the Direct Sale equal to 60% of the underwriting discounts and commissions
payable per Security in connection with the Securities purchased in the U.S.
Offering, or an aggregate of $1,480,000 for the 2,000,000 Securities purchased
in the Direct Sale.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the U.S. Securities for sale to the public as, and
upon the terms and conditions, set forth in the U.S. Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) The Company will file each of the Prospectuses with the Commission
pursuant to and in accordance with subparagraph (2) (or, if applicable and
if consented to by CSFBC, subparagraph (5)) of Rule 424(b) not later than
the second business day following the execution and delivery of this
Agreement. The Company will advise CSFBC promptly of any such filing
pursuant to Rule 424(b).
(b) The Company will advise CSFBC promptly of any proposal to amend or
supplement the Registration Statement or either of the Prospectuses and will
not effect such amendment or supplementation without CSFBC's prior consent,
which consent shall not be unreasonably withheld; and the Company will also
advise CSFBC promptly of the effectiveness of any amendment or
supplementation of the Registration Statement or either of the Prospectuses
and of the institution by the Commission of any stop order proceedings in
respect of the Registration Statement and will use its reasonable best
efforts to prevent the issuance of any such stop order and to obtain as soon
as possible its lifting, if issued.
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<PAGE>
(c) If, at any time when a prospectus relating to the Offered
Securities is required, in the opinion of counsel for the Underwriters, to
be delivered under the Act in connection with sales by any Underwriter,
Manager or dealer, any event occurs as a result of which either or both of
the Prospectuses as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, or if it is necessary at any such time to
amend either or both Prospectuses to comply with the Act, the Company will
promptly notify CSFBC of such event and will promptly prepare and file with
the Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery of,
any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 6.
(d) As soon as practicable, but not later than 16 months after the date
of this Agreement, the Company will make generally available to its
securityholders an earnings statement (which need not be audited) covering a
period of at least 12 months beginning after the later of (i) the effective
date of the most recent post-effective amendment to the Registration
Statement to become effective prior to the date of this Agreement and (ii)
the date of the Company's most recent Annual Report on Form 10-K filed with
the Commission prior to the date of this Agreement, which will satisfy the
provisions of Section 11(a) of the Act.
(e) The Company will furnish to the Representatives copies of the
Registration Statement (six of which will be signed and will include all
exhibits), each preliminary prospectus and preliminary prospectus supplement
relating to the U.S. Securities, and, so long as delivery of a prospectus
relating to the Offered Securities is required to be delivered under the Act
in connection with sales by any Underwriter or dealer, the U.S. Prospectus
and all amendments and supplements to such documents, in each case as soon
as available and in such quantities as CSFBC requests. The Company will pay
the expenses of printing and distributing to the Underwriters all such
documents.
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(f) The Company will arrange for the qualifications of the Offered
Securities for sale under the laws of such jurisdictions in the United
States as CSFBC designates and will continue such qualifications in effect
so long as required for the distribution, provided that, in connection
therewith the Company shall not, with respect to any such jurisdiction, be
required to qualify as a foreign corporation, to file a general consent to
service of process or to take any other action that would subject it to
service of process in suits other than those arising out of the offering of
the Offered Securities or to taxation in respect of doing business in any
jurisdiction in which it is not otherwise subject.
(g) During the period of three years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the
Underwriters, as soon as practicable, after the end of each fiscal year, a
copy of its annual report to stockholders for such year; and the Company
will furnish to the Representatives as soon as available, a copy of each
report and any definitive proxy statement of the Company filed with the
Commission under the Exchange Act or mailed to stockholders.
(h) The Company will pay all expenses incident to the performance of
its obligations under this Agreement and will reimburse the Underwriters (if
and to the extent incurred by them) for any travel expenses of the Company's
officers and employees and any other expenses of the Company in connection
with attending or hosting meetings with prospective purchasers of the
Offered Securities and for expenses incurred in distributing preliminary
prospectuses, preliminary prospectus supplements and the Prospectuses
(including any amendments and supplements thereto) to the Underwriters.
(i) The Company will indemnify and hold harmless the Underwriters
against any documentary, stamp or similar issuance tax, including any
interest and penalties, on the creation, issuance and sale of the Offered
Securities and on the execution and delivery of this Agreement. All payments
to be made by the Company hereunder shall be made without withholding or
deduction for or on account of any present or future taxes, duties or
governmental charges whatsoever unless the Company is compelled by law to
deduct or withhold such taxes, duties or charges. In that event, the Company
shall pay such additional amounts as may be necessary in order that the net
amounts received after such withholding or deduction shall equal the
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<PAGE>
amounts that would have been received if no withholding or deduction had
been made.
(j) For a period of 90 days after the date of the initial public
offering of the Offered Securities, neither the Company nor any of its
directors or officers will offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act relating to, any shares of the
Securities, or any securities that are convertible into or exercisable or
exchangeable for, or that represent the right to receive shares of the
Securities or publicly disclose the intention to make any such offer, sale,
pledge, disposal or filing, without the prior written consent of CSFBC,
except (i) issuances of Securities pursuant to the conversion or exchange of
convertible or exchangeable securities or the exercise of warrants or
options, in each case outstanding on the date hereof (ii) grants of employee
stock options pursuant to the terms of a plan in effect on the date hereof,
or issuances of Securities pursuant to the exercise of such options; (iii)
sales of Securities pursuant to employee stock benefit plans in effect on
the date hereof, and (iv) filing with the Commission a registration
statement relating to the Securities described in the preceding clauses (i),
(ii) and (iii). The Company shall, concurrently with the execution of this
Agreement, deliver to CSFBC an agreement executed by each of the directors
and officers of the Company pursuant to which each such person agrees, not
to offer, sell, contract to sell, pledge, grant any option to purchase, or
otherwise dispose of any of the Company's Securities or any securities
convertible into or exercisable or exchangeable for such Securities for a
period of 90 days after the date of the initial public offering of the
Offered Securities.
(k) The Company shall apply the net proceeds from the sale of the
Offered Securities as set forth in the Prospectuses.
(l) No action has been or, prior to the completion of the distribution
of the Offered Securities, will be taken by the Company in any jurisdiction
outside the United States that would permit a public offering of the Offered
Securities, or possession or distribution of the International Prospectus,
or any amendment or supplement thereto, or any related preliminary
prospectus or preliminary prospectus supplement issued in connection with
the offering of the Offered Securities, or any other offering material, in
any country or jurisdiction where action for that purpose is required.
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<PAGE>
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the U.S. Firm Securities on
the First Closing Date and the U.S. Optional Securities to be purchased on each
Optional Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions of Section 6(h), to the
performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
(a) On or prior to the date of this Agreement, the Representatives
shall have received a letter, dated the date of delivery thereof, of
Deloitte & Touche LLP (and the independent accountants of any subsidiary of
the Company or of any business acquired by the Company for which financial
statements and financial data are included or incorporated by reference in
the Prospectuses) in agreed form.
All financial statements and schedules included in material
incorporated by reference into the Registration Statement and the
Prospectuses shall be deemed included in the Registration Statement and the
Prospectuses for purposes of this subsection.
(b) Each of the Prospectuses shall have been filed with the Commission
in accordance with the Rules and Regulations and Section 5(a) of this
Agreement. Prior to such Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the knowledge
of the Company or the Representatives, shall be contemplated by the
Commission.
(c) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change the financial condition, business or results
of operations of the Company, the Subsidiaries and the Joint Ventures, taken
as a whole, which, in the judgment of a majority in interest of the
Underwriters including the Representatives, is material and adverse and
makes it impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the U.S. Securities; (ii) any
downgrading in the
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<PAGE>
rating of any debt securities or preferred stock of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities or preferred stock of the Company (other than an announcement
with positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (iii) any suspension or limitation of
trading in securities generally on the New York Stock Exchange or any
setting of minimum prices for trading on such exchange, or any suspension of
trading of any securities of the Company on any exchange or in the
over-the-counter market; (iv) any banking moratorium declared by U.S.
Federal or New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war
by the United States Congress or any other substantial national or
international calamity or emergency if, in the judgment of a majority in
interest of the Underwriters including the Representatives, the effect of
any such outbreak, escalation, declaration, calamity or emergency on the
financial markets makes it impracticable or inadvisable to proceed with
completion of the public offering or the sale of and payment for the U.S.
Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of Steven A. McArthur, Senior Vice President and General
Counsel of the Company, to the effect that:
(i) Each of the Company, the Subsidiaries and the Joint Ventures
has been duly organized and is validly existing and, if applicable, in
good standing under the laws of its respective jurisdiction of
organization and each of the Company, the Subsidiaries and the Joint
Ventures has the power and authority to own, lease and operate its
respective properties and to conduct its businesses as described in the
Prospectuses;
(ii) Each of the Company, the Subsidiaries and the Joint Ventures
is duly registered or qualified to do business and (to the extent
applicable) is in good standing as a foreign corporation, a foreign
partnership or a foreign limited liability company, as the case may be,
in each jurisdiction, domestic or foreign, in which such registration,
qualification or good standing is required (whether by reason
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<PAGE>
of the ownership or leasing of property, the conduct of its business or
otherwise), except where the failure to so register or qualify or be in
good standing is not reasonably likely to have a material adverse
effect on the financial condition, business or results of operation of
the Company, the Subsidiaries and the Joint Ventures taken as a whole;
(iii) The Company has the authorized and outstanding
capitalization as set forth under the caption "Capitalization" in the
Prospectuses; the Offered Securities have been validly authorized; when
the Offered Securities have been delivered and paid for in accordance
with this Agreement and the Subscription Agreement on each Closing
Date, such Offered Securities will have been validly issued, fully-paid
and nonassessable and all outstanding Securities will conform as to
legal matters in all material respects to the description thereof
contained in the Prospectuses; there are no preemptive or similar
rights, which have not been satisfied or waived, to subscribe for or to
purchase, nor any restriction on the transfer of, the Offered
Securities pursuant to the Company's charter, bylaws or any agreement
or other instrument; to the best knowledge of such counsel, all the
outstanding shares of capital stock of each Subsidiary have been duly
and validly authorized and issued and are fully paid and nonassessable;
and to the best knowledge of such counsel, except as otherwise set
forth in Schedule B attached hereto or disclosed in or contemplated by
the Prospectuses, all outstanding shares of capital stock of each
Subsidiary are owned beneficially by the Company free and clear of any
material claims, liens, encumbrances and security interests; and to the
best knowledge of such counsel, all of the partnership interests in the
Joint Ventures owned by the Company (as reflected in Schedule C
attached hereto) have been duly and validly authorized and issued, and,
except as otherwise disclosed in or contemplated by the Prospectuses,
are owned beneficially by the Company free and clear of any material
claims, liens, encumbrances and security interests;
(iv) The authorized capital stock of the Company, including the
Offered Securities, conforms as to legal matters in all material
respects to the description thereof contained in the Prospectuses;
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<PAGE>
(v) To such counsel's knowledge, except as otherwise disclosed in
the Prospectuses, there are no contracts, agreements or understandings
between the Company and any person that would give rise to a valid
claim against the Company or any Underwriter or Manager for a brokerage
commission, finder's fee or other like payment;
(vi) To such counsel's knowledge, there are no contracts,
agreements or understandings which have not been satisfied or waived
between the Company and any person granting such person the right to
require the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include any such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act;
(vii) Except as disclosed in or contemplated by the Prospectuses,
each of the Company, the Subsidiaries and the Joint Ventures has good
and valid title to, or valid and enforceable leasehold or contractual
interests in, all real properties and all other properties and assets
owned or leased by each of them that are material to the business of
each such entity, in each case free from all liens, encumbrances, and
defects that would materially interfere with the use made or to be made
thereof by them;
(viii) To such counsel's knowledge, there is no legal or
governmental action, suit or proceeding before any court, governmental
agency, body or authority, domestic or foreign, now pending, threatened
against, or involving, the Company, any Subsidiary or any Joint Venture
(i) of a character required to be disclosed in the Registration
Statement which is not adequately disclosed in the Registration
Statement or (ii) that, if determined adversely to the Company, any
Subsidiary or any Joint Venture, is reasonably likely to have,
individually or in the aggregate, a material adverse effect on the
financial condition, business or results of operations of the Company,
the Subsidiaries and the Joint Ventures taken as a whole or on the
ability
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<PAGE>
of the Company to perform its obligations under this Agreement or the
Subscription Agreement;
(ix) To such counsel's knowledge, the Company, each Subsidiary and
each Joint Venture (i) has obtained each license, permit, certificate,
franchise or other governmental authorization which is material to the
ownership of their properties or to the conduct of their businesses as
described in the Prospectuses and (ii) is in compliance with all terms
and conditions of such license, permit, certificate, franchise or other
governmental authorization, except (x) in either case where the failure
to do so is not reasonably likely to have, individually or in the
aggregate, a material adverse effect on the financial condition,
business or results of operations of the Company, the Subsidiaries and
the Joint Ventures taken as a whole, (y) permits, consents and
approvals that may be required for future drilling or operating
activities which are ordinarily deemed to be ministerial in nature and
which are anticipated to be obtained in the ordinary course and (z)
permits, consents and approvals for developmental or construction
activities which have not yet been obtained but which have been or will
be applied for in the course of development or construction and which
are anticipated to be obtained in the ordinary course;
(x) The Company has all requisite corporate power and authority to
enter into this Agreement and the Subscription Agreement, to issue the
Offered Securities and to consummate the transactions contemplated by
this Agreement and the Subscription Agreement;
(xi) There are no contracts or other documents which are required
to be described in the Prospectuses or filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations which
have not been described or filed as exhibits to the Registration
Statement or incorporated by reference therein as permitted by the
Rules and Regulations;
(xii) This Agreement and the Subscription Agreement have been duly
authorized, executed and delivered by the Company;
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<PAGE>
(xiii) (A) The execution, delivery and performance of this
Agreement and the Subscription Agreement, and the issuance and sale of
the Offered Securities and the use of proceeds of the Offered
Securities as designated in the Prospectuses do not and will not (i)
conflict with the corporate charter or by-laws or partnership agreement
of the Company, any Subsidiary or any Joint Venture, (ii) to the best
knowledge of such counsel, conflict with, result in the creation or
imposition of any lien, charge or other encumbrance upon any asset of
the Company, any Subsidiary or any Joint Venture pursuant to the terms
of, or constitute a breach of, or default under, any agreement,
indenture or other instrument to which the Company, any Subsidiary or
any Joint Venture is a party or by which the Company, any Subsidiary or
any Joint Venture is bound or to which any of the properties of the
Company, any Subsidiary or any Joint Venture is subject, or (iii) to
the best knowledge of such counsel, result in a violation of any
statute, rule, regulation, order, judgment or decree of any court or
governmental agency, body or authority having jurisdiction over the
Company, any Subsidiary or any Joint Venture or any of their properties
where any such conflict, encumbrance, breach, default or violation
under clauses (ii) or (iii), individually or in the aggregate, is
reasonably likely to have a material adverse effect on the financial
condition, business or results of operations of the Company, its
Subsidiaries and the Joint Ventures taken as a whole; (B) to the
knowledge of such counsel, except for (i) the registration of the
Offered Securities under the Act and (ii) such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Offered
Securities, no consent, authorization or order of, or filing or
registration by the Company, any Subsidiary or any Joint Venture with,
any court, governmental agency or third party is required in connection
with the execution, delivery and performance by the Company of this
Agreement and the Subscription Agreement, the consummation of the
transactions contemplated herein and therein, and the issuance,
distribution and sale of the Offered Securities as contemplated herein
and therein, the failure to obtain which, individually or in the
aggregate, is reasonably likely to have a material adverse effect on
the
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<PAGE>
financial condition, business or results of operations of the Company,
the Subsidiaries and the Joint Ventures taken as a whole, or on the
Offered Securities or the ability of the Company to perform its
obligations under this Agreement and the Subscription Agreement, and
(C) the Company has full corporate power and authority to authorize,
issue and sell the Offered Securities as contemplated by this Agreement
and the Subscription Agreement, respectively;
(xiv) The Company is not required to be registered under the
Investment Company Act of 1940, as amended;
(xv) The documents incorporated by reference in the Prospectuses
and any further amendments or supplements to any such incorporated
document made by the Company prior to the Closing Date (other than the
financial statements, related schedules and other financial and
statistical information contained therein or omitted therefrom as to
which such counsel need express no opinion), when they became effective
or were filed with the Commission, as the case may be, appear on their
face to have been appropriately responsive in all material respects to
the applicable requirements of the Act or the Exchange Act, as the case
may be, and the Rules and Regulations of the Commission thereunder; and
(e) The Company shall have furnished to the Representatives the opinion
of Willkie Farr & Gallagher, special counsel to the Company, addressed to
the Underwriters and dated the Closing Date, in form and substance
satisfactory to the Representatives, to the effect that:
(i) The Company has been duly organized and is validly existing
and in good standing under the laws of its jurisdiction of organization
and the Company has the corporate power and authority to own, lease and
operate its properties and to conduct its businesses as described in
the Prospectuses;
(ii) Such counsel has been advised by the Commission that the
Registration Statement has been declared effective under the Act; the
Prospectuses have been filed with the Commission pursuant to the
appropriate subparagraph of Rule 424(b) of the Rules and Regula-
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<PAGE>
tions; to the best knowledge of such counsel, no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened by the Commission;
(iii) The Registration Statement, as of its effective date, the
Registration Statement and the Prospectuses, as of the date of this
Agreement, and any further amendments or supplements thereto made by
the Company prior to the Closing Date (in each case, other than the
financial statements, related schedules, other financial and
statistical information contained therein or omitted therefrom as to
which such counsel need express no opinion) as of their effective
dates, appear on their face to have been appropriately responsive in
all material respects to the applicable requirements of the Act, the
Exchange Act and the Rules and Regulations;
(iv) To such counsel's knowledge, there are no contracts or other
documents which are required to be described in the Prospectuses or
filed as exhibits to the Registration Statement by the Act or by the
Rules and Regulations which have not been described or filed as
exhibits to the Registration Statement or incorporated by reference
therein as permitted by the Rules and Regulations;
(v) This Agreement and the Subscription Agreement have been duly
authorized, executed and delivered by the Company; and
(vi) No consent, authorization, order of, or filing or
registration by the Company with, any United States governmental
authority or body having jurisdiction over the Company is necessary or
required for the performance by the Company of its obligations under
this Agreement or the Subscription Agreement, or in connection with the
issuance and sale of the Offered Securities hereunder or thereunder,
except as may be required under applicable state or foreign securities
laws or blue sky laws in connection with the purchase and distribution
of the Offered Securities.
(f) In the rendering of the opinions described in Section 6(d) and
Section 6(e) above, such counsel may (i) state that their opinion is limited
to
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matters governed by the Federal laws of the United States of America, the
laws of the State of New York and the General Corporation Law of the State
of Delaware and (ii) rely, to the extent they deem proper, in respect of
matters of fact, upon certificates and representations of officers of the
Company, the Subsidiaries or the Joint Ventures and public officials. Such
counsel shall also have furnished to the Representatives a written
statement, addressed to the Underwriters and dated such Closing Date, in
form and substance reasonably satisfactory to the Representatives, to the
effect that (i) such counsel (in the case of Willkie Farr & Gallagher, such
counsel may state that they have acted as special counsel to the Company for
purposes of the subject Offering) have participated in conferences with
representatives of the Company, some of which have been attended by the
Underwriters and their counsel, at which conferences the contents of the
Registration Statement, the Prospectuses, each amendment thereof and
supplement thereto and related matters were discussed, although such counsel
has not independently checked or verified and is not passing upon and
assumes no responsibility for the factual accuracy, completeness or fairness
of the statements contained in the Registration Statement, the Prospectuses,
any amendment thereof or supplement thereto, and (ii) based on the
foregoing, no facts have come to the attention of such counsel which cause
them to believe that (except for the financial statements, related schedules
and other financial and statistical information contained therein or omitted
therefrom as to all of which such counsel need not express any belief) (I)
the Registration Statement (other than the documents incorporated by
reference therein), as of its effective date and as of the date of this
Agreement, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the Prospectuses, as
amended and supplemented as of the date of this Agreement or the Closing
Date, contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading or (II), in the case of the General Counsel of the
Company, any document incorporated by reference in the Prospectuses or any
further amendment or supplement to such incorporated document made by the
Company prior to the Closing Date when they became effective or were filed
with the Commission, as the case may be, contained, in the case of a
registration statement that became effective under the Act, any untrue
statement of a material fact or omitted to state a material fact required to
be
28
<PAGE>
stated therein, in the light of the circumstances under which they were
made, or necessary in order to make the statements therein not misleading,
or, in the case of other documents which were filed under the Exchange Act
with the Commission, an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(g) The Representatives shall have received from Skadden, Arps, Slate
Meagher & Flom LLP, counsel for the Underwriters, such opinion or opinions,
dated such Closing Date, with respect to the incorporation of the Company,
the validity of the Offered Securities delivered on such Closing Date, the
Registration Statement, the Prospectuses and other related matters as the
Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(h) The Representatives shall have received a certificate, dated such
Closing Date, of the President or any Vice-President and a principal
financial or accounting officer of the Company in which such officers, shall
state that to the best of their knowledge after reasonable investigation,
the representations and warranties of the Company in this Agreement and the
Subscription Agreement are true and correct in all material respects, that
the Company has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to such Closing
Date, that no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission and that, subsequent to the
date of the most recent financial statements included or incorporated by
reference in the Prospectuses, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the financial condition, business or results of operations of the
Company, the Subsidiaries and the Joint Ventures taken as a whole except as
set forth in or contemplated by the Prospectuses or as described in such
certificate.
(i) The Representatives shall have received letters, dated such Closing
Date, of Deloitte & Touche LLP and such other independent accountants for
subsidiaries and acquired businesses which meet the requirements of
subsection (a) of this Section, except that the specified date
29
<PAGE>
referred to in such subsection will be a date not more than three days prior
to such Closing Date for the purposes of this subsection.
(j) On such Closing Date, the Managers shall have purchased the
International Firm Securities or the International Optional Securities, as
the case may be, pursuant to the Subscription Agreement.
(k) The Offered Securities shall have been listed on the NYSE subject
only to notice of issuance thereof.
(l) Since the date of the latest audited financial statements included
or incorporated by reference in the Prospectuses (i) except as disclosed in
the Prospectuses, there shall have been no material adverse change, or a
development which is reasonably likely to lead to a material adverse change,
in the financial condition, business or results of operations of the
Company, the Subsidiaries and the Joint Ventures taken as a whole and (ii)
except as disclosed in the Prospectuses, there shall not have been any
transactions entered into by the Company, the Subsidiaries or any Joint
Venture, other than those in the ordinary course of business, which are
material and adverse to the Company, the Subsidiaries and the Joint Ventures
taken as a whole, and which, in the judgment of the Representatives, make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Offered Securities on the terms and in the manner
contemplated in the Prospectuses.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CSFBC may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder,
whether in respect of an Optional Closing Date or otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, either of the Prospectuses, or any amendment or
supplement thereto, or any related preliminary prospectus or preliminary
prospectus supplement, or arise out of or are based
30
<PAGE>
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein (with respect
to the Prospectuses, in light of the circumstances under which they were made)
not misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability or action arises out of or is based upon an untrue statement or
alleged untrue statement in or omission or alleged omission from any of such
documents in reliance upon and in conformity with written information furnished
to the Company by or on behalf of any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the only
information furnished by any Underwriter consists of the information described
as such in subsection (b) below; and provided, further, that, with respect to
any untrue statement or omission in the Preliminary Prospectus dated September
22, 1997, as supplemented by the U.S. Preliminary Prospectus Supplement and the
International Preliminary Prospectus Supplement both dated September 24, 1997
(as supplemented, collectively the "Preliminary Prospectuses"), this indemnity
agreement shall not inure to the benefit of any Underwriter on account of any
loss, claim, damage, liability or action arising from the sale of any Offered
Securities to any person by that Underwriter if that Underwriter failed to send
or give a copy of the Prospectuses, as the same may be amended or supplemented,
to that person within the time required by the Act, and the untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact in such Preliminary Prospectuses was corrected in the
Prospectuses and the Prospectuses were made available to the Underwriters prior
to the sale of the Offered Securities. For purposes of the last proviso to the
immediately preceding sentence, the term "Prospectuses" shall not be deemed to
include the documents incorporated by reference therein, and no Underwriter
shall be obligated to send or give any supplement or amendment to any document
incorporated by reference in the Preliminary Prospectuses or Prospectus any
person other than a person to whom such Underwriter had delivered such
incorporated document or documents in response to a written request therefor.
(a) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to
31
<PAGE>
which the Company may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, either of the
Prospectuses, or any amendment or supplement thereto, or any related preliminary
prospectus or preliminary prospectus supplement, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (with
respect to the Prospectuses, in the light of the circumstances under which they
were made) not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Underwriter through the
Representatives specifically for use therein, and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed that the
only such information furnished by any Underwriter consists of the following
information in the U.S. Prospectus furnished on behalf of each Underwriter: the
last paragraph at the bottom of the cover page concerning the terms of the
offering by the Underwriters, the legend concerning over-allotments and
stabilizing on the inside cover page, the concession and reallowance figures
appearing in the fifth paragraph in the section "Underwriting," the information
relating to the Intersyndicate Agreement in paragraphs 6 and 7 in the section
"Underwriting", the information relating to over-allotments and stabilizing in
the 10th paragraph in the section "Underwriting" and the information in the 11th
paragraph in the section "Underwriting".
(b) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above, except to the extent it has been materially
prejudiced by such failure; and provided, further, that such omission will not
relieve it from any liability which it may otherwise have to an indemnified
party. In case any such action is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein
32
<PAGE>
and, to the extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party will not be liable to such indemnified party
under this Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the indemnified party shall have
the right to employ counsel to represent the indemnified party and its
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the indemnified party against the
indemnifying party under this Section 7 if the employment of such counsel shall
have been authorized in writing by the indemnifying party in connection with the
defense of such action or, if in the written opinion of counsel to either the
indemnifying party or the indemnified party, representation of both parties by
the same counsel would be inappropriate due to actual or likely conflicts of
interest between them, and in that event the fees and expenses of one firm of
separate counsel (in addition to the fees and expenses of local counsel) shall
be paid by the indemnifying party. No indemnifying party shall, without the
prior written consent of the indemnified party, which consent shall not be
unreasonably withheld, effect any settlement of any pending or threatened action
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party unless such
settlement includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent.
(c) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the U.S.
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant
33
<PAGE>
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering of the U.S. Securities
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or the Underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such untrue statement or
omission. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any action or claim which is the subject of this subsection (d). Notwithstanding
the provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the U.S. Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(d) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each director, officer, employee and
agent of the Underwriters and to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer of the Company
who has signed the Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase U.S. Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of U.S.
Securities
34
<PAGE>
that such defaulting Underwriter or Underwriters agreed but failed to purchase
does not exceed 10% of the total number of shares of U.S. Securities that the
Underwriters are obligated to purchase on such Closing Date, CSFBC may make
arrangements satisfactory to the Company for the purchase of such U.S.
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date, the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the U.S. Securities that such defaulting Underwriters
agreed but failed to purchase on such Closing Date. If any Underwriter or
Underwriters so default and the aggregate number of shares of U.S. Securities
with respect to which such default or defaults occur exceeds 10% of the total
number of shares of U.S. Securities that the Underwriters are obligated to
purchase on such Closing Date and arrangements satisfactory to CSFBC and the
Company for the purchase of such U.S. Securities by other persons are not made
within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company, except
as provided in Section 9 (provided that if such default occurs with respect to
U.S. Optional Securities after the First Closing Date, this Agreement will not
terminate as to the U.S. Firm Securities or any U.S. Optional Securities
purchased prior to such termination). As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the U.S. Securities. If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the U.S. Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriters pursuant to Section 7 shall
remain in effect and if any U.S. Securities have been purchased hereunder the
representations and warranties in Section 7 and all obligations under Section 5
shall also remain in effect. If the purchase of the U.S. Securities by the
Underwriters is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to Section 8 or the occurrence
35
<PAGE>
of any event specified in clause (iii), (iv), or (v) of Section 6(c), the
Company will reimburse the Underwriters for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by them in
connection with the offering of the U.S. Securities; provided that the Company
shall not be obligated under this Section 9 to reimburse the Underwriters or the
Managers for any expenses (including fees and disbursements of counsel)
reasonably incurred by them in connection with the offering of the Offered
Securities in excess of $250,000.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives, c/o Credit Suisse First Boston Corporation, Eleven
Madison Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking
Department-Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at 302 South 36th Street,
Suite 400, Omaha, Nebraska 68131, Attention: General Counsel; provided, however,
that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representatives will act for
the several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFBC will be binding
upon all the Underwriters.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, without regard to
principles of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
36
<PAGE>
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
37
<PAGE>
If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to us the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.
Very truly yours,
CALENERGY COMPANY, INC.
By: /s/
____________________________
Name:
Title:
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
Credit Suisse First Boston Corporation
Lehman Brothers Inc.
Donaldson, Lufkin & Jenrette Securities
Corporation
Merrill Lynch, Pierce, Fenner & Smith Incorporated
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Acting on behalf of
themselves and as the
Representatives of the
several Underwriters.
By CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/
___________________________
Name:
Title:
38
<PAGE>
SCHEDULE A
----------
<TABLE>
<S> <C>
Number of
Underwriter U.S. Firm Securities
Credit Suisse First Boston Corporation................ 2,296,875
Lehman Brothers Inc................................... 2,296,875
Donaldson, Lufkin & Jenrette
Securities Corporation............................. 2,296,875
Merrill Lynch, Pierce, Fenner &
Smith Incorporated................................. 2,296,875
ABN AMRO Chicago Corporation............................ 218,750
Jefferies & Company, Inc................................ 218,750
Kirkpatrick, Pettis, Smith, Polian Inc.................. 218,750
Neuberger & Berman, LLC................................. 218,750
Charles Schwab & Co., Inc............................... 218,750
UBS Securities LLC...................................... 218,750
---------
Total........................................... 10,500,000
</TABLE>
39
<PAGE>
SCHEDULE B
----------
Subsidiaries
------------
Coso Funding Corp.+
Incorporated in Delaware
Coso Hotsprings Intermountain Power, Inc. +
Incorporated in Delaware
China Lake Operating Company +
Incorporated in Delaware
Coso Technology Corporation +
Incorporated in Delaware
China Lake Geothermal Management Company +
Incorporated in Delaware
China Lake Plant Services, Inc. +
Incorporated in California
Coso Hotsprings Overland Power, Inc.+
Incorporated in Delaware
CE Geothermal, Inc.
Incorporated in Delaware
Western States Geothermal Company
Incorporated in Delaware
Intermountain Geothermal Company
Incorporated in Delaware
CalEnergy Development Corporation
Incorporated in Delaware
California Energy Yuma Corporation
40
<PAGE>
Incorporated in Utah
California Energy General Corporation
Incorporated in Delaware
Rose Valley Properties, Inc.
Incorporated in Delaware
CalEnergy Minerals, Inc.
Incorporated in Delaware
CBE Engineering Co.
Incorporated in California
CE Exploration Company
Incorporated in Delaware
CE Newberry, Inc.
Incorporated in Delaware
CE International Investments Inc.
Incorporated in Delaware
CE Philippines Ltd.
Incorporated in Bermuda
CE Mahanagdong Ltd.
Incorporated in Bermuda
Ormoc Cebu Ltd.
Incorporated in Bermuda
CE Cebu Geothermal Power Company, Inc.+
Incorporated in the Philippines
-----------------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
41
<PAGE>
CE Indonesia Ltd.+
Incorporated in Bermuda
CE Casecnan Ltd.
Incorporated in Bermuda
CE Singapore Ltd.
Incorporated in Bermuda
CalEnergy International Ltd.
Incorporated in Bermuda
CE Bali, Ltd.
Incorporated in Bermuda
CE Casecnan Water and Energy Company, Inc.+
Incorporated in the Philippines
Capital Stock: Owned 35% by CE Casecnan Ltd.,
35% by Kiewit Energy International (Bermuda) Ltd.,
15% by La Prairie Group Contractors (International) Ltd
and 15% by San Lorenzo Ruiz Builders & Developers Group, Inc.
Magma Power Company+
Incorporated in Nevada
CalEnergy Operating Company+
Incorporated in Delaware
Salton Sea Power Company+
Incorporated in Nevada
Vulcan Power Company+
Incorporated in Nevada
Imperial Magma+
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
42
<PAGE>
Incorporated in Nevada
Magma Land Company I+
Incorporated in Nevada
Desert Valley Company+
Incorporated in California
Fish Lake Power Company+
Incorporated in Delaware
Magma Netherlands B.V.+
Formed in the Netherlands
Tongonan Power Investment, Inc.+
Incorporated in the Philippines
Salton Sea Funding Corporation +
Incorporated in Delaware
Salton Sea Royalty Company+
Incorporated in Delaware
CE Asia Ltd.+
Incorporated In Bermuda
American Pacific Finance Company
Incorporated in Delaware
CalEnergy International Services, Inc.
Incorporated in Delaware
CalEnergy Imperial Valley Company, Inc.
Incorporated in Delaware
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
43
<PAGE>
California Energy Retail Company, Inc.
Incorporated in Delaware
CE Humboldt, Inc.
Incorporated in Delaware
CE Ijen Ltd.
Incorporated in Bermuda
Magma Generating Company I
Incorporated in Nevada
Magma Generating Company II
Incorporated in Nevada
Peak Power Corporation
Incorporated in California
CE Luzon Geothermal Power Company, Inc.+
Incorporated in the Philippines
Capital Stock: Owned 50% by CE Mahanagdong Ltd.;
50% by Kiewit Energy International (Bermuda) Ltd.;
an industrial company has the right to acquire 10%
of the equity - 5% from CE Mahanagdong Ltd. and 5%
from Kiewit Energy International (Bermuda) Ltd.
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
44
<PAGE>
Himpurna California Energy Ltd.+
Incorporated in Bermuda
Capital Stock: Owned 47% by CE Indonesia Ltd.;
47% by Kiewit Energy International (Bermuda) Ltd.,
and 6% by P.T. Himpurna Enersindo Abadi; ("Himpurna").
Himpurna has assigned the right to certain preferred
dividends representing a 4% interest in Himpurna
California Energy Ltd., under the Joint Operating Contract,
Pertamina has certain rights to acquire up to a 25% interest
in the Joint Operating Contract, but not under the Energy
Sales Contract
Patuha Power, Ltd.+
Incorporated in Bermuda
Capital Stock: Owned 44% by CE Singapore Ltd.,
and 44% by Kiewit Energy International (Bermuda)
Ltd.; and 12% by Mahaka Energy; under the Joint
Operating Contract, Pertamina has certain rights to
acquire up to a 25% interest in the Joint Operating Contract,
but not under the Energy Sales Agreement
Bali Energy Ltd.+
Incorporated in Bermuda
Capital Stock: Owned 50% by CE Bali Ltd. and
50% by Kiewit Energy International (Bermuda) Ltd.
P.T. Pandanwangi Sekartji has the right to acquire
up to 40% of the equity in Bali Energy Ltd.
Norming Investments BV+
Incorporated in the Netherlands
BN Geothermal Inc.+
Incorporated in Delaware
Conejo Energy Company+
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
45
<PAGE>
Incorporated in California
Niguel Energy Company+
Incorporated in California
San Felipe Energy Company+
Incorporated in California
CE/FS Holding Company, Inc.
Incorporated in Delaware
Falcon Seaboard Power Corporation
Incorporated in Texas
Falcon Seaboard Resources, Inc.
Incorporated in Texas
Falcon Seaboard Energy Corporation
Incorporated in Texas
Falcon Seaboard Gas Company
Incorporated in Texas
Falcon Seaboard Oil Company
Incorporated in Texas
Falcon Seaboard Pipeline Corporation
Incorporated in Texas
Big Spring Pipeline Company
Incorporated in Texas
Falcon Power Operating Company
Incorporated in Texas
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
46
<PAGE>
Power Resources, Inc.+
Incorporated in Texas
North Country Gas Pipeline Corporation + Incorporated in New York Owned by
Saranac Power Partners, L.P.
Saranac Energy Company, Inc.+
Incorporated in Delaware
SECI Holdings, Inc.+
Incorporated in Delaware
Northern Consolidated Power, Inc. +
Incorporated in Delaware
NorCon Holdings, Inc.
Incorporated in Delaware
CE Electric, Inc.
Incorporated in Delaware
CE Power, Inc.
Incorporated in Delaware
CE Electric UK plc +
Incorporated in England
Capital Stock: Owned by CE Electric UK Holdings
American Pacific Finance Company II +
Incorporated in Delaware
Capital Stock: Owned 50% by CalEnergy Company, Inc. and
50% by Kiewit Energy Company
CE Indonesia Geothermal, Inc.
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
47
<PAGE>
Incorporated in Delaware
Slupo I B.V.+
Incorporated in Netherlands
Owned 50% by CE Asia Ltd. and 50% by Kiewit
Energy International (Bermuda) Limited
CE Indonesia Funding Corp. +
Incorporated in Delaware
Owned 50% by Himpurna California Energy Ltd.
and 50% by Patuha Power, Ltd.
Gilbert/CBE Indonesia L.L.C.
Organized in Nebraska
Owned 60% Gilbert Industrial Corporation and 40% CBE Engineering Co.
Northern Electric plc+
Incorporated in England and Wales
Owned by CE Electric UK plc.
Northern Electric Generation (NPL) Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Supply Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Share Scheme Trustee Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Transport Finance Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
48
<PAGE>
Northern Electric Retail Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Properties Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Distribution Limited
Incorporated in England and Wales
Owned by Northern Electric plc.
Gas UK Limited+
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric (Overseas Holdings) Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Generation (CPS) Limited +
Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Kings Road Developments Limited+
Incorporated in England and Wales
Owned 48% by Northern Electric plc., 26% by Cussins Homes
and 26% by Bellway Homes.
Ryhope Road Developments Ltd. +
Incorporated in England and Wales
Owned 49% by Northern Electric Properties Ltd. and
51% by Bowey Group Limited
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
49
<PAGE>
Stamfordham Road Developments Ltd.+
Incorporated in England and Wales
Owned 49% by Northern Electric Properties Ltd. and
51% by Cussins Commercial Development Ltd.
Northern Electric Generation (TPL) Limited +
Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Northern Electric Generation Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Insurance Services Limited +
Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Northern Metering Services Limited +
Incorporated in Isle of Man
Owned indirectly by Northern Electric plc.
CalEnergy Gas (UK) Limited +
Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Northern Electric Generation (Peaking) Limited +
Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Northern Electric Training Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Transport Limited +
Incorporated in England and Wales
- ----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
50
<PAGE>
Owned by Northern Electric plc.
Northern Information Systems Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Utility Services Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Viking Power Ltd.+
Incorporated in England and Wales
Capital Stock: Owned 50% by Northern Electric Generation Limited
and 50% by Rolls-Royce Power Ventures Limited
Northern Electric Finance plc. +
Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Northgas Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Tracing & Collection Services Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Telecom Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
CE Electric UK Holdings +
Incorporated in England
Capital Stock: Owned 35% by CE Power, Inc., 35% by CE Electric Inc. and
30% by Kiewit Energy UK, Inc.
- ----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
51
<PAGE>
CalEnergy Gas (Polska)
*Polish limited liability company
Owned indirectly by
Northern Electric plc.
CalEnergy Capital Trust I
Formed under the laws of Delaware
CalEnergy Capital Trust II
Formed under the laws of Delaware
CalEnergy Capital Trust III
Formed under the laws of Delaware
CalEnergy Capital Trust IV
Formed under the laws of Delaware
- ----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
52
<PAGE>
SCHEDULE C
----------
Joint Ventures
--------------
Coso Energy Developers (CED)+
Formed in California
General Partnership: 48% CHIP; 52% Caithness Coso
Holdings, L.P.
Coso Finance Partners+
Formed in California
General Partnership: 46.3% owned by CLOC; 53.7%
owned by ESCA I, L.P.
Coso Power Developers (CPD)+
Formed in California
General Partnership: 50% owned by CTC; 50% by
Caithness Navy II
Coso Transmission Line Partners+
Formed in California
General Partnership: Owned 50% by CED; 50% by CPD
Vulcan/BN Geothermal Power Company+
Formed in Nevada
Partnership Interests: Vulcan Power Company 50%
General Partner; BN Geothermal, Inc. 50% General
Partner
Del Ranch, L.P.+
Formed in California
Partnership Interests: Magma Power Company 10%
- ----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
53
<PAGE>
Limited Partner; CalEnergy Operating Company 40% General Partner; Conejo
Energy Company 10% Limited Partner and 40% General Partner
Elmore, L.P.+
Formed in California
Partnership Interests: Magma Power Company 10%
Limited Partner; CalEnergy Operating Company 40% General Partner; Niguel
Energy Company 10% Limited Partner
and 40% General Partner
Leathers, L.P.+
Formed in California
Partnership Interests: Magma Power Company 10%
Limited Partner; CalEnergy Operating Company 40% General Partner; San Felipe
Energy Company 10% Limited Partner and 40% General Partner
Salton Sea Brine Processing L.P.+
Limited Partnership Formed in California
Salton Sea Power Generation L.P.+
Limited Partnership Formed in California
Visayas Geothermal Power Company+
Partnership Formed in the Philippines
Yuma Cogeneration Associates+
Formed in Utah
Alto Peak Power Company
Formed in the Philippines
China Lake Joint Venture
Formed in California
Owed 50% by CalEnergy Company and
50% by Caithness Geothermal 1980 Ltd.
- ----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
54
<PAGE>
Coso Finance Partners II
Formed in California
Owned 50% by China Lake Geothermal Management Co., an affiliate of
Calenergy Company, Inc. and 50% by ESCA II, L.P.
Coso Land Company
Formed in California
Owned 50% by CalEnergy Company and
50% by Caithness Geothermal 1980 Ltd.
Gilbert/CBE L.P.
Limited partnership formed in Nebraska
Partnership Interests: 20% CBE Engineering Co. and 80% Gilbert Industrial
Corporation
Saranac Power Partners, L.P.+
Limited partnership formed in Delaware
Partnership Interests: 80% Saranac Energy Company, Inc. and 20%
affiliates of Tomen Power Corporation
NorCon Power Partners, L.P.+
Limited partnership formed in Delaware
Partnership Interests: 80% Northern Consolidated Power, Inc. and 20%
affiliates of Tomen Power Corporation
----------------------
+ Indicates stock or partnership interests that are and at the Closing Date
will continue to be pledged, subject to a purchase agreement, or otherwise
encumbered and subject to foreclosure or other exercise of remedies.
55
<PAGE>
15,000,000 Shares
CALENERGY COMPANY, INC.
Common Stock
SUBSCRIPTION AGREEMENT
London, England
October 13, 1997
Credit Suisse First Boston (Europe) Limited
Lehman Brothers International (Europe)
ABN AMRO Rothschild
HSBC Investment Bank Plc
UBS Limited
c/o Credit Suisse First Boston (Europe) Limited ("CSFBL")
One Cabot Square
London, England E14 4QJ
Dear Sirs:
1. Introductory. CalEnergy Company, Inc., a Delaware
corporation ("Company"), proposes to issue and sell ("International Offering")
to the several Managers named in Schedule A hereto ("Managers") 4,500,000 shares
("International Firm Securities") of its Common Stock, par value $.0675 per
share ("Securities").
It is understood that the Company is concurrently entering
into an Underwriting Agreement, dated the date hereof ("Underwriting
Agreement"), with certain United States underwriters listed in Schedule A
thereto ("U.S. Underwriters"), for whom Credit Suisse First Boston Corporation
("CSFBC"), Lehman Brothers Inc., Donaldson, Lufkin & Jenrette Securities
Corporation and Merrill Lynch, Pierce, Fenner & Smith Incorporated are acting as
representatives ("U.S. Representatives") relating to the concurrent offering and
sale in the United States and Canada ("U.S. Offering") of 10,500,000 shares of
Securities ("U.S. Firm Securities").
<PAGE>
It is also understood that the Company is concurrently
entering into a Purchase Agreement, dated the date hereof ("Purchase
Agreement"), with Walter C. Scott, Jr., Chairman and President of Peter Kiewit
Sons', Inc, and/or certain affiliated trusts and other entities directly or
indirectly related to Mr. Scott, relating to the concurrent sale of 2,000,000
shares of Securities ("Direct Sale").
In addition, the Company proposes to issue and sell to the
U.S. Underwriters and the Managers an option exercisable by CSFBC for an
aggregate of not more than 2,100,000 additional shares of Securities ("Optional
Securities"; the Optional Securities for the International Offering are referred
to as the "International Optional Securities" and the Optional Securities for
the offering in the United States and Canada are referred to as the "U.S.
Optional Securities"). The U.S. Firm Securities and the U.S. Optional Securities
are hereinafter called the "U.S. Securities"; the International Firm Securities
and the International Optional Securities are hereinafter called the
"International Securities"; and the U.S. Firm Securities and the International
Firm Securities are hereinafter called the "Firm Securities". The U.S.
Securities and the International Securities are collectively referred to as the
"Offered Securities". To provide for the coordination of their activities, the
U.S. Underwriters and the Managers have entered into an Agreement Between U.S.
Underwriters and Managers which permits them, among other things, to sell the
Offered Securities to each other for purposes of resale.
The Company hereby agrees with the several Managers as
follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Managers that:
(a) A registration statement on Form S-3 (No. 333-32821),
including a form of prospectus relating to certain debt and equity
securities ("Registered Securities") to be issued from time to time by
the Company, has been filed with the Securities and Exchange Commission
("Commission") and has been declared effective under the Securities Act
of 1933, as amended ("Act"). The Company proposes to file with the
Commission pursuant to Rule 424 under the Act a form of prospectus
supplement specifically relating to the U.S. Securities and a form of
prospectus supplement specifically relating to the International
Securities. The registration statement, as amended at the time of this
Agreement, including all material incorporated by reference therein, is
hereinafter referred to as the "Registration Statement," and the form
of prospectus included in such Registration
2
<PAGE>
Statement, as supplemented by the prospectus supplement
specifically relating to the U.S. Securities and the form of prospectus
included in such Registration Statement, as supplemented by the
prospectus supplement specifically relating to the International
Securities, in each case as first filed with the Commission pursuant to
and in accordance with Rule 424(b) ("Rule 424(b)") under the Act,
including all material incorporated by reference therein, are
hereinafter referred to as the "U.S. Prospectus" and the "International
Prospectus", respectively, and collectively as the "Prospectuses". No
document has been or will be prepared or distributed in reliance on
Rule 434 under the Act.
(b) On the effective date of the registration statement
relating to the Registered Securities, such registration statement
conformed in all material respects to the requirements of the Act and
the rules and regulations of the Commission ("Rules and Regulations")
thereunder and did not include any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and on the
date of this Agreement, the Registration Statement conforms, and at the
time of filing of each of the Prospectuses pursuant to Rule 424(b), the
Registration Statement and each of the Prospectuses will conform, in
all material respects to the requirements of the Act and the Rules and
Regulations, and none of such documents includes, or will include, any
untrue statement of a material fact or omits, or will omit, to state
any material fact required to be stated therein or necessary to make
the statements therein (with respect to the Prospectuses, in the light
of the circumstances under which they were made) not misleading, except
that the foregoing does not apply to statements in or omissions from
the Registration Statement or either of the Prospectuses based upon
written information furnished to the Company by or on behalf of any
Underwriter through the Representatives or by or on behalf of any
Manager through CSFBL specifically for use therein, it being understood
and agreed that the only such information is that described as such in
Section 7(b).
(c) The documents incorporated by reference in the
Registration Statement and the Prospectuses, when they became effective
or were last amended or filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or
the Securities Exchange Act of 1934, as amended ("Exchange Act"), as
applicable, and the Rules and Regulations, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact
3
<PAGE>
required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they
were made, and any further documents so filed and incorporated by
reference in the Registration Statement and the Prospectuses, when such
documents become effective or are filed with the Commission, as the
case may be, shall conform in all material respects to the requirements
of the Act and the Exchange Act as applicable, and the Rules and
Regulations and shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances under which they were made.
(d) The Company, each Subsidiary (as defined below) and each
Joint Venture (as defined below) have been duly organized and are
validly existing and, if applicable, in good standing under the laws of
their respective jurisdictions of organization as a corporation,
limited liability company or partnership, as the case may be, and have
the power and authority to own, lease and operate their property and
conduct their businesses as described in the Prospectuses; the Company,
the Subsidiaries and the Joint Ventures are duly qualified to do
business and are in good standing as foreign corporations or foreign
partnerships, as the case may be, in each jurisdiction, domestic or
foreign, in which such registration or qualification or good standing
is required (whether by reason of the ownership or leasing of property,
the conduct of business or otherwise), except where the failure to so
register or qualify or be in good standing is not reasonably likely to
have a material adverse effect on the financial condition, business or
results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole. For purposes of this Agreement, (A) the term
"Subsidiary" shall mean the entities listed in Schedule B hereto
("Schedule B") and (B) the term "Joint Venture" shall mean the entities
listed in Schedule C hereto ("Schedule C"), it being understood that
such term means the general or limited partnership or other joint
venture entity and not the individual general or limited partners or
other joint venturers thereof. The Subsidiaries listed in Schedule B
are all the material direct and indirect "subsidiaries" of the Company,
as such term is defined in Rule 405 of the Rules and Regulations, and
are all of the "Significant Subsidiaries" of the Company, as such term
is defined in Rule 1-02 of Regulation S-X.
4
<PAGE>
(e) All the outstanding shares of capital stock of each
Subsidiary have been duly and validly authorized and issued and are
fully-paid and nonassessable; and except as otherwise set forth in
Schedule B or disclosed in or contemplated by the Prospectuses, all
outstanding shares of capital stock of each Subsidiary are owned
beneficially by the Company free and clear of any material claims,
liens, encumbrances and security interests. All of the partnership
interests in the Joint Ventures beneficially owned by the Company (as
reflected in Schedule C) have been duly and validly authorized and
issued and, except as otherwise set forth in Schedule C or disclosed in
or contemplated by the Prospectuses, are owned beneficially by the
Company free and clear of any material claims, liens, encumbrances and
security interests.
(f) The Firm Securities and any Optional Securities and all
other outstanding shares of capital stock of the Company have been duly
authorized; all outstanding shares of capital stock of the Company are,
and, when the Offered Securities have been delivered and paid for in
accordance with this Agreement and the Underwriting Agreement on each
Closing Date (as defined below), such Offered Securities will have
been, validly issued, fully paid and nonassessable and will conform to
the description thereof contained in the Prospectuses; and the
stockholders of the Company have no preemptive rights with respect to
the Offered Securities which have not been waived.
(g) The use of the proceeds of the offering of the Offered
Securities as described in the Prospectuses has been duly authorized by
all necessary action on the part of the Company.
(h) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
U.S. Underwriter or Manager for a brokerage commission, finder's fee or
other like payment in connection with the offering of the Offered
Securities.
(i) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings which have not been satisfied
or waived between the Company and any person requiring the Company to
include securities of the Company owned or to be owned by such person
in the securities registered pursuant to the Registration Statement.
5
<PAGE>
(j) The outstanding shares of Common Stock are listed on The
New York Stock Exchange (the "Stock Exchange") and the Offered
Securities have been approved for listing on the Stock Exchange,
subject to notice of issuance.
(k) The execution, delivery and performance of this Agreement
and the Underwriting Agreement, and the issuance and sale of the
Offered Securities and the use of the proceeds of the offering of the
Offered Securities as described in the Prospectuses, will not (A)
conflict with the corporate charter or by-laws or partnership agreement
of the Company, any Subsidiary or any Joint Venture, (B) conflict with,
result in the creation or imposition of any lien, charge or other
encumbrance upon any asset of the Company, any Subsidiary or any Joint
Venture pursuant to the terms of, or constitute a breach of, or default
under, any agreement, indenture or other instrument to which the
Company, any Subsidiary or any Joint Venture is a party or by which the
Company, any Subsidiary or any Joint Venture is bound or to which any
of the properties of the Company, any Subsidiary or any Joint Venture
is subject, or (C) result in a violation of any statute, rule,
regulation, order, judgment or decree of any court or governmental
agency, body or authority having jurisdiction over the Company, any
Subsidiary or any Joint Venture or any of their properties where any
such conflicts, encumbrances, breaches, defaults or violations under
clauses (B) or (C), individually or in the aggregate, is reasonably
likely to (i) have a material adverse effect on the financial
condition, business or results of operations of the Company, the
Subsidiaries and the Joint Ventures taken as a whole or (ii) impair the
validity or enforceability of the Offered Securities under the Act.
(l) Except (A) as to state or foreign securities laws and (B)
consents of third parties which have been obtained, no consent,
approval, authorization or order of, or filing or registration by the
Company, any Subsidiary or, to the best of the Company's knowledge, any
Joint Venture with, any court, governmental agency or third party is
required for the consummation of the transactions contemplated by this
Agreement and the Underwriting Agreement in connection with the
issuance and sale of the Offered Securities by the Company and the use
of the proceeds of the offering of the Offered Securities as described
in the Prospectuses.
6
<PAGE>
(m) The Company has full power and authority to authorize,
issue and sell the Offered Securities as contemplated by this Agreement
and the Underwriting Agreement, respectively.
(n) This Agreement and the Underwriting Agreement have each
been duly authorized, executed and delivered by the Company.
(o) Except as disclosed in or contemplated by the
Prospectuses, the Company, each Subsidiary and each Joint Venture
holds, as applicable, good and valid title to, or valid and enforceable
leasehold or contractual interests in, all real properties and all
other properties and assets owned or leased by or held under contract
by each of them that are material to the business of the Company, the
Subsidiaries and the Joint Ventures taken as a whole, and free from
liens, encumbrances and defects that would materially interfere with
the use made or to be made thereof by them.
(p) Except as disclosed in or contemplated by the
Prospectuses, the Company, the Subsidiaries and the Joint Ventures
carry, or are covered by, insurance in such amounts and covering such
risks as is customary for similarly situated companies in the
Company's, such Subsidiaries' and such Joint Ventures' industries,
respectively. Each of the foregoing insurance policies is valid and in
full force and effect, and no event has occurred and is continuing that
permits, or after notice or lapse of time or both would permit,
modifications or terminations of the foregoing that, individually or in
the aggregate, is reasonably likely to have a material adverse effect
on the financial condition, business or results of operations of the
Company, the Subsidiaries and the Joint Ventures taken as a whole.
(q) Except as disclosed in or contemplated by the
Prospectuses, the Company, each Subsidiary and each Joint Venture (i)
has obtained each license, permit, certificate, franchise or other
governmental authorization which is material to the ownership of their
properties or to the conduct of their businesses as described in or
contemplated by the Prospectuses and (ii) is in compliance with all
terms and conditions of such license, permit, certificate, franchise or
other governmental authorization, except (A) in either case where the
failure to do so is not reasonably likely to have, individually or in
the aggregate, a material adverse effect on the financial condition,
business or results of operations of the Company, the Subsidiaries and
the Joint Ventures taken as a whole, (B) permits, consents and
approvals that may be required for future drilling or operating
activities
7
<PAGE>
which are ordinarily deemed to be ministerial in nature and which are
anticipated to be obtained in the ordinary course and (C) permits,
consents and approvals for developmental or construction activities
which have not yet been obtained but which have been or will be applied
for in the course of development or construction and which are
anticipated to be obtained in the ordinary course.
(r) Except as disclosed in the Prospectuses, there are no
legal or governmental actions, suits or proceedings before any court,
governmental agency, body or authority, domestic or foreign, now
pending or, to the knowledge of the Company, threatened against, or, to
the knowledge of the Company, involving, the Company, any Subsidiary or
any Joint Venture (i) of a character required to be disclosed in the
Registration Statement which is not adequately disclosed in the
Registration Statement or (ii) that, if determined adversely to the
Company, any Subsidiary or any Joint Venture, would be reasonably
likely to have, individually or in the aggregate, a material adverse
effect on the financial condition, business or results of operations of
the Company, the Subsidiaries and the Joint Ventures taken as a whole,
or on the ability of the Company to perform its obligations under this
Agreement or the Underwriting Agreement, or which are otherwise
material in the context of the sale of the Offered Securities.
(s) The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.
(t) The Company, the Subsidiaries and the Joint Ventures are
currently conducting their respective businesses as described in the
Prospectuses.
(u) There are no contracts or documents of a character
required to be described in the Registration Statement or Prospectuses
or to be filed as exhibits to the Registration Statement which are not
described or filed as required under the Act.
(v) There is no relationship, direct or indirect, that exists
between or among the Company on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Company on the
other hand, of a character required to be described in the Registration
Statement or Prospectuses which is not described as required under the
Act.
8
<PAGE>
(w) There is no labor problem or disturbance with the persons
employed by the Company, any Subsidiary or any Joint Venture that
exists or, to the knowledge of the Company, that is threatened and that
might reasonably be expected to have a material adverse effect on the
financial condition, business or results of operations of the Company,
the Subsidiaries and the Joint Ventures taken as a whole.
(x) Neither the Company nor any person who is a member of a
group which is under common control with the Company and the
Subsidiaries and the Joint Ventures, who together with the Company, the
Subsidiaries and the Joint Ventures is treated as a single employer
("ERISA Affiliate") within the meaning of Section 414(b), (c), (m) or
(o) of the Internal Revenue Code of 1986, as amended from time to time
(the "Code"), or Section 4001(b) of the Employee Retirement Income
Security Act of 1974, as amended from time to time ("ERISA"), has
established, sponsored, maintained or had any obligation to contribute
to any employee benefit plans within the meaning of Section 3(3) of
ERISA which are subject to Title IV of ERISA or Section 412 of the
Code. Except where it could not reasonably be expected to result in a
material adverse effect on the financial condition, business or results
of operations of the Company, the Subsidiaries and the Joint Ventures
taken as a whole, (i) all employee benefit plans within the meaning of
Section 3(3) of ERISA established, sponsored or maintained for or on
behalf of the employees, officers or directors of the Company, the
Subsidiaries, the Joint Ventures or any ERISA Affiliate ("Employee
Benefit Plans") are in compliance with all applicable provisions of
ERISA and the Code and the regulations and published interpretations
thereunder and each such Employee Benefit Plan that is intended to be
qualified under Code Section 401(a) has been determined by the Internal
Revenue Service to be so qualified and (ii) no material liability or
obligation has been incurred or is reasonably expected to be incurred
by the Company, the Subsidiaries or the Joint Ventures or any ERISA
Affiliate with respect to any Employee Benefit Plan.
(y) None of the Company, any Subsidiary or any Joint Venture
(i) is in violation of its respective charter, by-laws or partnership
agreements, (ii) is in default, and no event exists and is continuing
that, with notice or lapse of time or both, would constitute such a
default, in the due performance and observance of any material term
contained in any lease, license, indenture, mortgage, deed of trust,
note, bank loan or other evidence of indebtedness or any other
agreement, understanding or instrument to which
9
<PAGE>
the Company, any Subsidiary or any Joint Venture is a party or by which
the Company, any Subsidiary or any Joint Venture or any property of the
Company, any Subsidiary or any Joint Venture may be bound or affected,
which default, individually or in the aggregate, is reasonably likely
to have a material adverse effect on the financial condition, business
or results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole, or (iii) is in violation of any law,
ordinance, governmental rule or regulation or court decree to which it
may be subject, which violation, individually or in the aggregate, is
reasonably likely to have a material adverse effect on the financial
condition, business or results of operations of the Company, the
Subsidiaries and the Joint Ventures taken as a whole or would
materially interfere with the execution, delivery and performance of
this Agreement, or the Underwriting Agreement, the issuance and sale of
the Offered Securities or the use of the proceeds of the offering of
the Offered Securities as described in the Prospectuses.
(z) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment of toxic
wastes, hazardous wastes or hazardous substances, pollutants or
contaminants by the Company, any Subsidiary or any Joint Venture (or,
to the knowledge of the Company, any of their predecessors in interest)
at, upon or from any of the property now or previously owned or leased
by the Company, any Subsidiary or any Joint Venture in violation of any
applicable law, ordinance, rule, regulation, order, judgment, decree or
permit or which would require remedial action under any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit, except
for any violation or remedial action which does not have, or would not
be reasonably likely to have, individually or in the aggregate with all
such violations and remedial actions, a material adverse effect on the
financial condition, business or results of operations of the Company,
the Subsidiaries and the Joint Ventures taken as a whole; there has
been no material spill, discharge, leak, emission, injection, escape,
dumping or release of any kind onto such property or into the
environment surrounding such property of any toxic wastes, solid
wastes, hazardous wastes or hazardous substances, pollutants or
contaminants due to or caused by the Company, any Subsidiary or any
Joint Venture or with respect to which the Company, any Subsidiary or
any Joint Venture has knowledge, except for any such spill, discharge,
leak, emission, injection, escape, dumping or release which does not
have, or would not be reasonably likely to have, individually or in the
aggregate with all such spills, discharges, leaks, emissions,
injections, escapes, dumpings and
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releases, a material adverse effect on the financial condition,
business or results of operations of the Company, the Subsidiaries and
the Joint Ventures taken as a whole; and the terms "hazardous wastes",
"toxic wastes" and "hazardous substances" shall have the meanings
specified in any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(aa) None of the Company or any Subsidiary or any Joint
Venture is an open-end investment company, unit investment trust or
face-amount certificate company that is or is required to be registered
under Section 8 of the United States Investment Company Act of 1940, as
amended (the "1940 Act"), nor is it a closed-end investment company
required to be registered, but not registered, thereunder; and each of
the Company, each Subsidiary and each Joint Venture is not and, after
giving effect to the offering and sale of the Offered Securities and
the application of the proceeds thereof as described in the
Prospectuses, will not be an "investment company", or, to the best
knowledge of the Company after due inquiry, a company controlled by an
"investment company" within the meaning of the 1940 Act.
(ab) The Company, each Subsidiary and each Joint Venture has
filed all federal, state and local income and franchise tax returns
required to be filed through the date hereof, or has filed extensions
in accordance with applicable law, and has paid all taxes required to
be paid through the date hereof thereon, except for such failures to
file or pay that would not, individually or in the aggregate, be
reasonably likely to have a material adverse effect on the financial
condition, business or results of operations of the Company, the
Subsidiaries and the Joint Ventures taken as a whole, and no tax
deficiency has been determined adversely to the Company, any Subsidiary
or any Joint Venture that has had (nor does the Company have any
knowledge of any tax deficiency which, if determined adversely to the
Company, any Subsidiary or any Joint Venture would be reasonably likely
to have) a material adverse effect on the financial condition, business
or results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole.
(ac) The financial statements and the related notes and
schedules included or incorporated by reference in the Registration
Statement and the Prospectuses fairly present the financial position,
the results of operations and the cash flows of the Company and its
consolidated subsidiaries at the
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respective dates and for the respective periods to which they apply;
and such financial statements and the related notes and schedules have
been prepared in conformity with United States generally accepted
accounting principles applied on a consistent basis throughout the
periods therein specified. The historical information under the caption
"Capitalization" in the Prospectuses is accurately described as of the
date presented therein.
(ad) Since the date of the latest financial statements
included or incorporated by reference in the Prospectuses (i) there has
been no material adverse change, nor any development or event involving
a prospective material adverse change, in the financial condition,
business or results of operations of the Company, the Subsidiaries and
the Joint Ventures taken as a whole, and (ii) except as disclosed in or
contemplated by the Prospectuses, there have not been any transactions
entered into by the Company, the Subsidiaries or any Joint Venture,
other than those in the ordinary course of business, which are material
to the Company, the Subsidiaries and the Joint Ventures taken as a
whole; and, except as disclosed in the Prospectuses, there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(ae) The pro forma financial information included in the
Registration Statement and the Prospectuses presents fairly the
information shown therein, has been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
information, has been properly compiled on the pro forma bases
described therein, and, in the opinion of the Company, the assumptions
used in the preparation thereof are reasonable and the adjustments used
therein are appropriate to give effect to the transactions or
circumstances referred to therein.
(af) The accountants who have certified certain financial
statements of the Company or of businesses acquired by the Company, as
applicable, and whose reports appear in the Registration Statement and
the Prospectuses or are incorporated by reference therein, are and were
independent public accountants as required by the Act and the Rules and
Regulations during the periods covered by the financial statements on
which they reported which are contained or incorporated by reference in
the Registration Statement or the Prospectuses.
(ag) (i) Each of the operational electric generation
facilities ("Plants") owned in whole or in part, directly or indirectly
by (A) the
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Company, (B) the Subsidiaries or (C) the Joint Ventures which is
located in the United States is a "qualifying cogeneration facility" or
a "qualifying small power production facility" (either or both of which
are hereinafter referred to as a "QF"), as such terms are defined under
the Federal Power Act, as amended ("FPA"), and the regulations
thereunder, and has continuously been in compliance with the
requirements for being a QF since it commenced sales of electricity;
(ii) with respect to each Plant under development and located in the
United States, either (x) to the extent that the Company, the
Subsidiaries or the Joint Ventures plan to act as the owner and/or
operator of any one of the Plants under development by the Company, the
Subsidiaries or the Joint Ventures and located in the United States (as
currently configured or as currently anticipated to be configured),
that owner and/or operator satisfies or is currently expected to
satisfy current regulatory requirements for being an "exempt wholesale
generator" ("EWG"), as such term is defined under the FPA, the Public
Utility Holding Company Act of 1935, as amended ("PUHCA") and the
regulations thereunder or (y) each of the Plants under development by
the Company, the Subsidiaries or the Joint Ventures and located in the
United States (as currently configured or as currently anticipated to
be configured) will be a QF and will be in continuous compliance with
the requirements for being a QF; (iii) the owner or operator of each of
the Plants under development by the Company, the Subsidiaries or the
Joint Ventures and located outside the United States (as currently
configured or as currently anticipated to be configured) satisfies or
is currently expected to satisfy current regulatory requirements for
being either (A) an EWG or (B) a "foreign utility company," as such
term is defined under PUHCA and the regulations thereunder; (iv) none
of the entities identified in clause (A) or (B) of subparagraph (i)
above owns or operates or will own or operate any electric distribution
facilities or any electric transmission facilities in or outside of the
United States other than electric transmission facilities that have
been or will be approved by the Federal Energy Regulatory Commission as
being part of a QF, or the owner and/or operator of which will have
qualified as EWG's or as "foreign utility companies" as such terms are
defined under the FPA, PUHCA and the regulations thereunder; and (v)
none of the entities identified in clause (A), (B) or (C) of
subparagraph (i) above is, or is subject to regulation as, a "public
utility holding company" or a "subsidiary company" of a "public utility
holding company," as those terms are defined under PUHCA, or is subject
to regulation under the FPA, other than as contemplated by 18 C.F.R
Section 292.601(c), or, except as described in or contemplated by the
Prospectuses, subject to regulation by
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<PAGE>
any state law or foreign governmental law with respect to rates or the
financial or organizational regulation of electric utilities.
3. Purchase, Sale and Delivery of Offered Securities. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company agrees to sell
to the Managers, and the Managers agree, severally and not jointly, to purchase
from the Company, at a purchase price of $36.645 per share (representing a
public offering price of $37.875 per share less a selling concession (as
described below) of $1.23 per share), the respective number of shares of
International Firm Securities set forth opposite the names of the Managers in
Schedule A hereto.
The Company will deliver the International Firm Securities to
CSFBL for the accounts of the Managers, against payment of the purchase price in
U.S. dollars in Federal (same day funds) by official bank check or checks or
wire transfer to an account at a bank acceptable to CSFBL drawn to the order of
CalEnergy Company, Inc. at the offices of Skadden, Arps, Slate, Meagher & Flom
LLP, 919 Third Avenue, New York, New York, at 10:00 A.M., New York time, on
October 17, 1997 or at such other time not later than seven full business days
thereafter as CSFBL and the Company determine, such time being herein referred
to as the "First Closing Date". For purposes of Rule 15c6-1 under the Exchange
Act, the First Closing Date (if later than the otherwise applicable settlement
date) shall be the settlement date for payment of funds and delivery of
securities for all the International Firm Securities sold pursuant to the
International Offering. The certificates for the International Firm Securities
so to be delivered will be in definitive form, in such denominations and
registered in such names as CSFBL requests and will be made available for
checking and packaging at the office of CSFBC, at least 24 hours prior to the
First Closing Date.
In addition, upon written notice from CSFBC given to the
Company from time to time not more than 30 days subsequent to the date of the
initial public offering of the Offered Securities, the U.S. Underwriters and the
Managers may purchase all or less than all of the Optional Securities at the
purchase price per Security to be paid for the Firm Securities. The
International Optional Securities to be purchased by the Managers on any
Optional Closing Date (as defined below) shall be in the same proportion to all
the Optional Securities to be purchased by the U.S. Underwriters and the
Managers on such Optional Closing Date as the International Firm Securities bear
to all the Firm Securities and the U.S. Optional Securities to be purchased by
the U.S. Underwriters on any Optional Closing Date shall be in the same
proportion to all the Optional Securities to be
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<PAGE>
purchased by the U.S. Underwriters and the Managers on such Optional Closing
Date as the U.S. Firm Securities bear to all the Firm Securities. The Company
agrees to sell to the Managers such International Optional Securities specified
in such notice and the Managers agree, severally and not jointly, to purchase
such International Optional Securities. The International Optional Securities
shall be purchased for the account of each Manager in the same proportion as the
number of shares of International Firm Securities set forth opposite such
Manager's name bears to the total number of shares of International Firm
Securities (subject to adjustment by CSFBC to eliminate fractions). The Optional
Securities may be purchased by the U.S. Underwriters and the Managers only for
the purpose of covering over-allotments made in connection with the sale of the
Firm Securities. No Optional Securities shall be sold or delivered unless the
related Firm Securities previously have been, or simultaneously are, sold and
delivered. The right to purchase the Optional Securities or any portion thereof
may be exercised from time to time and to the extent not previously exercised
may be surrendered and terminated at any time upon notice by CSFBC on behalf of
the U.S. Underwriters and the Managers to the Company.
Each time for the delivery of and payment for the
International Optional Securities, being herein referred to as an "Optional
Closing Date", which may be the First Closing Date (the First Closing Date and
each Optional Closing Date, if any, being sometimes referred to as a "Closing
Date"), shall be determined by CSFBC but shall be not later than seven full
business days after written notice of election to purchase Optional Securities
is given. The Company will deliver the International Optional Securities being
purchased on each Optional Closing Date to CSFBL for the accounts of the several
Managers, against payment of the purchase price therefor in Federal (same day)
funds by official bank check or checks or wire transfer to an account at a bank
acceptable to CSFBL drawn to the order of CalEnergy Company, Inc., at the above
office of Skadden, Arps, Slate, Meagher & Flom LLP. The certificates for the
International Optional Securities will be in definitive form, in such
denominations and registered in such names as CSFBL requests upon reasonable
notice prior to such Optional Closing Date and will be made available for
checking and packaging at the above office of CSFBC, at a reasonable time in
advance of such Optional Closing Date.
The Company will pay to the Managers as aggregate compensation
for their commitments hereunder and for their services in connection with the
purchase of the International Securities and the management of the offering
thereof, if the sale and delivery of the International Securities to the
Managers provided herein is consummated, an amount equal to U.S. $1.23 per
International
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<PAGE>
Security purchased, which may be divided among the Managers in such proportions
as they may determine. Such payment will be made on the First Closing Date in
the case of the International Firm Securities and on each Optional Closing Date
in the case of the International Optional Securities sold to the Manager on such
Closing Date, in each case by way of deduction by the Managers of said amount
from the purchase price for the International Securities referred to above.
4. Offering by Underwriters. It is understood that the several
Managers propose to offer the International Securities for sale to the public
as, and upon the terms and conditions, set forth in the International
Prospectus.
5. Certain Agreements of the Company. The Company agrees with
the several Managers that:
(a) The Company will file each of the Prospectuses with the
Commission pursuant to and in accordance with subparagraph (2) (or, if
applicable and if consented to by CSFBL, subparagraph (5)) of Rule
424(b) not later than the second business day following the execution
and delivery of this Agreement. The Company will advise CSFBL promptly
of any such filing pursuant to Rule 424(b).
(b) The Company will advise CSFBL promptly of any proposal to
amend or supplement the Registration Statement or either of the
Prospectuses and will not effect such amendment or supplementation
without CSFBL's prior consent, which consent shall not be unreasonably
withheld; and the Company will also advise CSFBL promptly of the
effectiveness of any amendment or supplementation of the Registration
Statement or either of the Prospectuses and of the institution by the
Commission of any stop order proceedings in respect of the Registration
Statement and will use its reasonable best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required, in the opinion of counsel for the U.S.
Underwriters and Managers, to be delivered under the Act in connection
with sales by any U.S. Underwriter, Manager or dealer, any event occurs
as a result of which either or both of the Prospectuses as then amended
or supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, or if it is
16
<PAGE>
necessary at any such time to amend either or both Prospectuses to
comply with the Act, the Company will promptly notify CSFBL of such
event and will promptly prepare and file with the Commission, at its
own expense, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such
compliance. Neither CSFBL's consent to, nor the Managers' delivery of,
any such amendment or supplement shall constitute a waiver of any of
the conditions set forth in Section 6.
(d) As soon as practicable, but not later than 16 months after
the date of this Agreement, the Company will make generally available
to its securityholders an earnings statement (which need not be
audited) covering a period of at least 12 months beginning after the
later of (i) the effective date of the most recent post-effective
amendment to the Registration Statement to become effective prior to
the date of this Agreement and (ii) the date of the Company's most
recent Annual Report on Form 10-K filed with the Commission prior to
the date of this Agreement, which will satisfy the provisions of
Section 11(a) of the Act.
(e) The Company will furnish to the Managers copies of the
Registration Statement (six of which will be signed and will include
all exhibits), each preliminary prospectus and preliminary prospectus
supplement relating to the International Securities, and, until
completion of the distribution of the International Securities as
determined by CSFBL, the International Prospectus and all amendments
and supplements to such documents, in each case as soon as available
and in such quantities as CSFBL requests. The Company will pay the
expenses of printing and distributing to the Managers all such
documents.
(f) The Company will arrange for the qualifications of the
Offered Securities for sale under the laws of such jurisdictions in the
United States as CSFBC designates and will continue such qualifications
in effect so long as required for the distribution, provided that, in
connection therewith the Company shall not, with respect to any such
jurisdiction, be required to qualify as a foreign corporation, to file
a general consent to service of process or to take any other action
that would subject it to service of process in suits other than those
arising out of the offering of the Offered Securities or to taxation in
respect of doing business in any jurisdiction in which it is not
otherwise subject.
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<PAGE>
(g) During the period of three years hereafter, the Company
will furnish to CSFBL and, upon request, to each of the other Managers,
as soon as practicable, after the end of each fiscal year, a copy of
its annual report to stockholders for such year; and the Company will
furnish to CSFBL as soon as available, a copy of each report and any
definitive proxy statement of the Company filed with the Commission
under the Exchange Act or mailed to stockholders.
(h) The Company will pay all expenses incident to the
performance of its obligations under this Agreement and will reimburse
the Managers (if and to the extent incurred by them) for any travel
expenses of the Company's officers and employees and any other expenses
of the Company in connection with attending or hosting meetings with
prospective purchasers of the Offered Securities and for expenses
incurred in distributing preliminary prospectuses, preliminary
prospectus supplements and the Prospectuses (including any amendments
and supplements thereto) to the Managers.
(i) The Company will indemnify and hold harmless the Managers
against any documentary, stamp or similar issuance tax, including any
interest and penalties, on the creation, issuance and sale of the
Offered Securities and on the execution and delivery of this Agreement.
All payments to be made by the Company hereunder shall be made without
withholding or deduction for or on account of any present or future
taxes, duties or governmental charges whatsoever unless the Company is
compelled by law to deduct or withhold such taxes, duties or charges.
In that event, the Company shall pay such additional amounts as may be
necessary in order that the net amounts received after such withholding
or deduction shall equal the amounts that would have been received if
no withholding or deduction had been made.
(j) For a period of 90 days after the date of the initial
public offering of the Offered Securities, neither the Company nor any
of its directors or officers will offer, sell, contract to sell, pledge
or otherwise dispose of, directly or indirectly, or file with the
Commission a registration statement under the Act relating to, any
shares of the Securities, or any securities that are convertible into
or exercisable or exchangeable for, or that represent the right to
receive, shares of the Securities or publicly disclose the intention to
make any such offer, sale, pledge, disposal or filing, without the
prior written consent of CSFBC, except (i) issuances of
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<PAGE>
Securities pursuant to the conversion or exchange of convertible or
exchangeable securities or the exercise of warrants or options, in each
case outstanding on the date hereof, (ii) grants of employee stock
options pursuant to the terms of a plan in effect on the date hereof,
or issuances of Securities pursuant to the exercise of such options;
(iii) sales of Securities pursuant to employee stock benefit plans in
effect on the date hereof, and (iv) filing with the Commission a
registration statement relating to the Securities described in the
preceding clauses (i), (ii) and (iii) . The Company shall, concurrently
with the execution of this Agreement, deliver to CSFBC an agreement
executed by each of the directors and officers of the Company pursuant
to which each such person agrees, not to offer, sell, contract to sell,
pledge, grant any option to purchase, or otherwise dispose of any of
the Company's Securities or any securities convertible into or
exercisable or exchangeable for such Securities for a period of 90 days
after the date of the initial public offering of the Offered
Securities.
(k) The Company shall apply the net proceeds from the sale of
the Offered Securities as set forth in the Prospectuses.
(l) No action has been or, prior to the completion of the
distribution of the Offered Securities, will be taken by the Company in
any jurisdiction outside the United States that would permit a public
offering of the Offered Securities, or possession or distribution of
the International Prospectus, or any amendment or supplement thereto,
or any related preliminary prospectus or preliminary prospectus
supplement issued in connection with the offering of the Offered
Securities, or any other offering material, in any country or
jurisdiction where action for that purpose is required.
6. Conditions of the Obligations of the Managers. The
obligations of the several Managers to purchase and pay for the
International Firm Securities on the First Closing Date and the
International Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the
statements of Company officers made pursuant to the provisions of
Section 6(h), to the performance by the Company of its obligations
hereunder and to the following additional conditions precedent:
(a) On or prior to the date of this Agreement, the Managers
shall have received a letter, dated the date of delivery thereof, of
Deloitte &
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<PAGE>
Touche LLP (and the independent accountants of any subsidiary of the
Company or of any business acquired by the Company for which financial
statements and financial data are included or incorporated by reference
in the Prospectuses) in agreed form.
All financial statements and schedules included in material
incorporated by reference into the Registration Statement and the
Prospectuses shall be deemed included in the Registration Statement and
the Prospectuses for purposes of this subsection.
(b) Each of the Prospectuses shall have been filed with the
Commission in accordance with the Rules and Regulations and Section
5(a) of this Agreement. Prior to such Closing Date, no stop order
suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Company or the Managers, shall
be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change the financial
condition, business or results of operations of the Company, the
Subsidiaries and the Joint Ventures, taken as a whole, which, in the
judgment of CSFBL, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the International Securities; (ii) any
downgrading in the rating of any debt securities or preferred stock of
the Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act),
or any public announcement that any such organization has under
surveillance or review its rating of any debt securities or preferred
stock of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any suspension or limitation of
trading in securities generally on the New York Stock Exchange or any
setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of the Company on any exchange
or in the over-the-counter market; (iv) any banking moratorium declared
by U.S. Federal or New York authorities; or (v) any outbreak or
escalation of major hostilities in which the United States is involved,
any declaration of war by the United States Congress or any other
substantial national or international calamity or emergency if, in
20
<PAGE>
the judgment of CSFBL, the effect of any such outbreak, escalation,
declaration, calamity or emergency on the financial markets makes it
impracticable or inadvisable to proceed with completion of the public
offering or the sale of and payment for the International Securities.
(d) The Managers shall have received an opinion, dated such
Closing Date, of Steven A. McArthur, Senior Vice President and General
Counsel of the Company, to the effect that:
(i) Each of the Company, the Subsidiaries and the
Joint Ventures has been duly organized and is validly existing
and, if applicable, in good standing under the laws of its
respective jurisdiction of organization and each of the
Company, the Subsidiaries and the Joint Ventures has the power
and authority to own, lease and operate its respective
properties and to conduct its businesses as described in the
Prospectuses;
(ii) Each of the Company, the Subsidiaries and the
Joint Ventures is duly registered or qualified to do business
and (to the extent applicable) is in good standing as a
foreign corporation, a foreign partnership or a foreign
limited liability company, as the case may be, in each
jurisdiction, domestic or foreign, in which such registration,
qualification or good standing is required (whether by reason
of the ownership or leasing of property, the conduct of its
business or otherwise), except where the failure to so
register or qualify or be in good standing is not reasonably
likely to have a material adverse effect on the financial
condition, business or results of operation of the Company,
the Subsidiaries and the Joint Ventures taken as a whole;
(iii) The Company has the authorized and outstanding
capitalization as set forth under the caption "Capitalization"
in the Prospectuses; the Offered Securities have been validly
authorized; when the Offered Securities have been delivered
and paid for in accordance with this Agreement and the
Underwriting Agreement on each Closing Date, such Offered
Securities will have been validly issued, fully-paid and
nonassessable and all outstanding Securities will conform as
to legal matters in all material respects to the description
thereof contained in the Prospectuses; there are no preemptive
or similar rights, which have not been satisfied or
21
<PAGE>
waived, to subscribe for or to purchase, nor any restriction
on the transfer of, the Offered Securities pursuant to the
Company's charter, bylaws or any agreement or other
instrument; to the best knowledge of such counsel, all the
outstanding shares of capital stock of each Subsidiary have
been duly and validly authorized and issued and are fully paid
and nonassessable; and to the best knowledge of such counsel,
except as otherwise set forth in Schedule B attached hereto or
disclosed in or contemplated by the Prospectuses, all
outstanding shares of capital stock of each Subsidiary are
owned beneficially by the Company free and clear of any
material claims, liens, encumbrances and security interests;
and to the best knowledge of such counsel, all of the
partnership interests in the Joint Ventures owned by the
Company (as reflected in Schedule C attached hereto) have been
duly and validly authorized and issued, and, except as
otherwise disclosed in or contemplated by the Prospectuses,
are owned beneficially by the Company free and clear of any
material claims, liens, encumbrances and security interests;
(iv) The authorized capital stock of the Company,
including the Offered Securities, conforms as to legal matters
in all material respects to the description thereof contained
in the Prospectuses;
(v) To such counsel's knowledge, except as otherwise
disclosed in the Prospectuses, there are no contracts,
agreements or understandings between the Company and any
person that would give rise to a valid claim against the
Company or any U.S. Underwriter or Manager for a brokerage
commission, finder's fee or other like payment;
(vi) To such counsel's knowledge, there are no
contracts, agreements or understandings which have not been
satisfied or waived between the Company and any person
granting such person the right to require the Company to file
a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person
or to require the Company to include any such securities in
the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to
any other registration statement filed by the Company under
the Act;
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<PAGE>
(vii) Except as disclosed in or contemplated by the
Prospectuses, each of the Company, the Subsidiaries and the
Joint Ventures has good and valid title to, or valid and
enforceable leasehold or contractual interests in, all real
properties and all other properties and assets owned or leased
by each of them that are material to the business of each such
entity, in each case free from all liens, encumbrances, and
defects that would materially interfere with the use made or
to be made thereof by them;
(viii) To such counsel's knowledge, there is no legal
or governmental action, suit or proceeding before any court,
governmental agency, body or authority, domestic or foreign,
now pending, threatened against, or involving, the Company,
any Subsidiary or any Joint Venture (i) of a character
required to be disclosed in the Registration Statement which
is not adequately disclosed in the Registration Statement or
(ii) that, if determined adversely to the Company, any
Subsidiary or any Joint Venture, is reasonably likely to have,
individually or in the aggregate, a material adverse effect on
the financial condition, business or results of operations of
the Company, the Subsidiaries and the Joint Ventures taken as
a whole or on the ability of the Company to perform its
obligations under this Agreement or the Underwriting
Agreement;
(ix) To such counsel's knowledge, the Company, each
Subsidiary and each Joint Venture (i) has obtained each
license, permit, certificate, franchise or other governmental
authorization which is material to the ownership of their
properties or to the conduct of their businesses as described
in the Prospectuses and (ii) is in compliance with all terms
and conditions of such license, permit, certificate, franchise
or other governmental authorization, except (x) in either case
where the failure to do so is not reasonably likely to have,
individually or in the aggregate, a material adverse effect on
the financial condition, business or results of operations of
the Company, the Subsidiaries and the Joint Ventures taken as
a whole, (y) permits, consents and approvals that may be
required for future drilling or operating activities which are
ordinarily deemed to be ministerial in nature and which are
anticipated to be obtained in the ordinary course and (z)
permits, consents and approvals for developmental or
construction activities which have not yet been obtained but
which have been or will be applied for in the course of
23
<PAGE>
development or construction and which are anticipated to be
obtained in the ordinary course;
(x) The Company has all requisite corporate power and
authority to enter into this Agreement and the Underwriting
Agreement, to issue the Offered Securities and to consummate
the transactions contemplated by this Agreement and the
Underwriting Agreement;
(xi) There are no contracts or other documents which
are required to be described in the Prospectuses or filed as
exhibits to the Registration Statement by the Act or by the
Rules and Regulations which have not been described or filed
as exhibits to the Registration Statement or incorporated by
reference therein as permitted by the Rules and Regulations;
(xii) This Agreement and the Underwriting Agreement
have been duly authorized, executed and delivered by the
Company;
(xiii) (A) The execution, delivery and performance of
this Agreement and the Underwriting Agreement, and the
issuance and sale of the Offered Securities and the use of
proceeds of the Offered Securities as designated in the
Prospectuses do not and will not (i) conflict with the
corporate charter or by-laws or partnership agreement of the
Company, any Subsidiary or any Joint Venture, (ii) to the best
knowledge of such counsel, conflict with, result in the
creation or imposition of any lien, charge or other
encumbrance upon any asset of the Company, any Subsidiary or
any Joint Venture pursuant to the terms of, or constitute a
breach of, or default under, any agreement, indenture or other
instrument to which the Company, any Subsidiary or any Joint
Venture is a party or by which the Company, any Subsidiary or
any Joint Venture is bound or to which any of the properties
of the Company, any Subsidiary or any Joint Venture is
subject, or (iii) to the best knowledge of such counsel,
result in a violation of any statute, rule, regulation, order,
judgment or decree of any court or governmental agency, body
or authority having jurisdiction over the Company, any
Subsidiary or any Joint Venture or any of their properties
where any such conflict, encumbrance, breach, default or
violation under clauses (ii) or (iii), individually or in the
aggregate, is reasonably likely
24
<PAGE>
to have a material adverse effect on the financial condition,
business or results of operations of the Company, its
Subsidiaries and the Joint Ventures taken as a whole; (B) to
the knowledge of such counsel, except for (i) the registration
of the Offered Securities under the Act and (ii) such
consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities laws in connection with the
purchase and distribution of the Offered Securities, no
consent, authorization or order of, or filing or registration
by the Company, any Subsidiary or any Joint Venture with, any
court, governmental agency or third party is required in
connection with the execution, delivery and performance by the
Company of this Agreement and the Underwriting Agreement, the
consummation of the transactions contemplated herein and
therein, and the issuance, distribution and sale of the
Offered Securities as contemplated herein and therein, the
failure to obtain which, individually or in the aggregate, is
reasonably likely to have a material adverse effect on the
financial condition, business or results of operations of the
Company, the Subsidiaries and the Joint Ventures taken as a
whole, or on the Offered Securities or the ability of the
Company to perform its obligations under this Agreement and
the Underwriting Agreement, and (C) the Company has full
corporate power and authority to authorize, issue and sell the
Offered Securities as contemplated by this Agreement and the
Underwriting Agreement, respectively;
(xiv) The Company is not required to be registered
under the Investment Company Act of 1940, as amended;
(xv) The documents incorporated by reference in the
Prospectuses and any further amendments or supplements to any
such incorporated document made by the Company prior to the
Closing Date (other than the financial statements, related
schedules and other financial and statistical information
contained therein or omitted therefrom as to which such
counsel need express no opinion), when they became effective
or were filed with the Commission, as the case may be, appear
on their face to have been appropriately responsive in all
material respects to the applicable requirements of the Act or
the Exchange Act, as the case may be, and the Rules and
Regulations of the Commission thereunder; and
25
<PAGE>
(e) The Company shall have furnished to the Managers the
opinion of Willkie Farr & Gallagher, special counsel to the Company,
addressed to the Managers and dated the Closing Date, in form and
substance satisfactory to CSFBL, to the effect that:
(i) The Company has been duly organized and is
validly existing and in good standing under the laws of its
jurisdiction of organization and the Company has the corporate
power and authority to own, lease and operate its properties
and to conduct its businesses as described in the
Prospectuses;
(ii) Such counsel has been advised by the Commission
that the Registration Statement has been declared effective
under the Act; the Prospectuses have been filed with the
Commission pursuant to the appropriate subparagraph of Rule
424(b) of the Rules and Regulations; to the best knowledge of
such counsel, no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceeding
for that purpose is pending or threatened by the Commission;
(iii) The Registration Statement, as of its effective
date, the Registration Statement and the Prospectuses, as of
the date of this Agreement, and any further amendments or
supplements thereto made by the Company prior to the Closing
Date (in each case, other than the financial statements,
related schedules, other financial and statistical information
contained therein or omitted therefrom as to which such
counsel need express no opinion) as of their effective dates,
appear on their face to have been appropriately responsive in
all material respects to the applicable requirements of the
Act, the Exchange Act and the Rules and Regulations;
(iv) To such counsel's knowledge, there are no
contracts or other documents which are required to be
described in the Prospectuses or filed as exhibits to the
Registration Statement by the Act or by the Rules and
Regulations which have not been described or filed as exhibits
to the Registration Statement or incorporated by reference
therein as permitted by the Rules and Regulations;
(v) This Agreement and the Underwriting Agreement
have been duly authorized, executed and delivered by the
Company; and
26
<PAGE>
(vi) No consent, authorization, order of, or filing
or registration by the Company with, any United States
governmental authority or body having jurisdiction over the
Company is necessary or required for the performance by the
Company of its obligations under this Agreement or the
Underwriting Agreement, or in connection with the issuance and
sale of the Offered Securities hereunder or thereunder, except
as may be required under applicable state or foreign
securities laws or blue sky laws in connection with the
purchase and distribution of the Offered Securities.
(f) In the rendering of the opinions described in Section 6(d)
and Section 6(e) above, such counsel may (i) state that their opinion
is limited to matters governed by the Federal laws of the United States
of America, the laws of the State of New York and the General
Corporation Law of the State of Delaware and (ii) rely, to the extent
they deem proper, in respect of matters of fact, upon certificates and
representations of officers of the Company, the Subsidiaries or the
Joint Ventures and public officials. Such counsel shall also have
furnished to the Managers a written statement, addressed to the
Managers and dated such Closing Date, in form and substance reasonably
satisfactory to CSFBL, to the effect that (i) such counsel (in the case
of Willkie Farr & Gallagher, such counsel may state that they have
acted as special counsel to the Company for purposes of the subject
Offering) have participated in conferences with representatives of the
Company, some of which have been attended by the Managers and their
counsel, at which conferences the contents of the Registration
Statement, the Prospectuses, each amendment thereof and supplement
thereto and related matters were discussed, although such counsel has
not independently checked or verified and is not passing upon and
assumes no responsibility for the factual accuracy, completeness or
fairness of the statements contained in the Registration Statement, the
Prospectuses, any amendment thereof or supplement thereto, and (ii)
based on the foregoing, no facts have come to the attention of such
counsel which cause them to believe that (except for the financial
statements, related schedules and other financial and statistical
information contained therein or omitted therefrom as to all of which
such counsel need not express any belief) (I) the Registration
Statement (other than the documents incorporated by reference therein),
as of its effective date and as of the date of this Agreement,
contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the Prospectuses,
as amended and supple-
27
<PAGE>
mented as of the date of this Agreement or the Closing Date, contain
any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading or (II), in the case of the General Counsel of the
Company, any document incorporated by reference in the Prospectuses or
any further amendment or supplement to such incorporated document made
by the Company prior to the Closing Date when they became effective or
were filed with the Commission, as the case may be, contained, in the
case of a registration statement that became effective under the Act,
any untrue statement of a material fact or omitted to state a material
fact required to be stated therein, in the light of the circumstances
under which they were made, or necessary in order to make the
statements therein not misleading, or, in the case of other documents
which were filed under the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(g) The Managers shall have received from Skadden, Arps, Slate
Meagher & Flom LLP, counsel for the Managers, such opinion or opinions,
dated such Closing Date, with respect to the incorporation of the
Company, the validity of the Offered Securities delivered on such
Closing Date, the Registration Statement, the Prospectuses and other
related matters as the CSFBL may require, and the Company shall have
furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(h) The Managers shall have received a certificate, dated such
Closing Date, of the President or any Vice-President and a principal
financial or accounting officer of the Company in which such officers,
shall state that to the best of their knowledge after reasonable
investigation, the representations and warranties of the Company in
this Agreement and the Underwriting Agreement are true and correct in
all material respects, that the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to such Closing Date, that no stop
order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been instituted or
are contemplated by the Commission and that, subsequent to the date of
the most recent financial statements included or incorporated by
reference in the Prospectuses, there has been no material
28
<PAGE>
adverse change, nor any development or event involving a prospective
material adverse change, in the financial condition, business or
results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole except as set forth in or contemplated by the
Prospectuses or as described in such certificate.
(i) The Managers shall have received letters, dated such
Closing Date, of Deloitte & Touche LLP and such other independent
accountants for subsidiaries and acquired businesses which meet the
requirements of subsection (a) of this Section, except that the
specified date referred to in such subsection will be a date not more
than three days prior to such Closing Date for the purposes of this
subsection.
(j) On such Closing Date, the U.S. Underwriters shall have
purchased the U.S. Firm Securities or the U.S. Optional Securities, as
the case may be, pursuant to the Underwriting Agreement.
(k) The Offered Securities shall have been listed on the NYSE
subject only to notice of issuance thereof.
(l) Since the date of the latest audited financial statements
included or incorporated by reference in the Prospectuses (i) except as
disclosed in the Prospectuses, there shall have been no material
adverse change, or a development which is reasonably likely to lead to
a material adverse change, in the financial condition, business or
results of operations of the Company, the Subsidiaries and the Joint
Ventures taken as a whole and (ii) except as disclosed in the
Prospectuses, there shall not have been any transactions entered into
by the Company, the Subsidiaries or any Joint Venture, other than those
in the ordinary course of business, which are material and adverse to
the Company, the Subsidiaries and the Joint Ventures taken as a whole,
and which, in the judgment of CSFBL, make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Offered Securities on the terms and in the manner contemplated in the
Prospectuses.
The Company will furnish the Managers with such conformed copies of such
opinions, certificates, letters and documents as the Managers reasonably
request. CSFBL may in its sole discretion waive on behalf of the Managers
compliance with any conditions to the obligations of the Managers hereunder,
whether in respect of an Optional Closing Date or otherwise.
29
<PAGE>
7. Indemnification and Contribution. (a) The Company will
indemnify and hold harmless each Manager against any losses, claims, damages or
liabilities, joint or several, to which such Manager may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in the Registration
Statement, either of the Prospectuses, or any amendment or supplement thereto,
or any related preliminary prospectus or preliminary prospectus supplement, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein (with respect to the Prospectuses, in light of the
circumstances under which they were made) not misleading, and will reimburse
each Manager for any legal or other expenses reasonably incurred by such Manager
in connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability or action arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission from
any of such documents in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Manager through
CSFBL specifically for use therein, it being understood and agreed that the only
information furnished by any Manager consists of the information described as
such in subsection (b) below; and provided, further, that, with respect to any
untrue statement or omission in the Preliminary Prospectus dated September 22,
1997, as supplemented by the International Preliminary Prospectus Supplement and
the U.S. Preliminary Prospectus Supplement both dated September 24, 1997 (as
supplemented, collectively the "Preliminary Prospectuses"), this indemnity
agreement shall not inure to the benefit of any Manager on account of any loss,
claim, damage, liability or action arising from the sale of any Offered
Securities to any person by that Manager if that Manager failed to send or give
a copy of the Prospectuses, as the same may be amended or supplemented, to that
person within the time required by the Act, and the untrue statement or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact in such Preliminary Prospectuses was corrected in the Prospectuses
and the Prospectuses were made available to the Managers prior to the sale of
the Offered Securities. For purposes of the last proviso to the immediately
preceding sentence, the term "Prospectuses" shall not be deemed to include the
documents incorporated by reference therein, and no Manager shall be obligated
to send or give any supplement or amendment to any document incorporated by
reference in the Preliminary Prospectuses or Prospectus any person other than a
person to
30
<PAGE>
whom such Manager had delivered such incorporated document or documents in
response to a written request therefor.
(b) Each Manager will severally and not jointly indemnify and
hold harmless the Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, either of the
Prospectuses, or any amendment or supplement thereto, or any related preliminary
prospectus or preliminary prospectus supplement, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (with
respect to the Prospectuses, in the light of the circumstances under which they
were made) not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Manager through CSFBL
specifically for use therein, and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Manager consists of the following information in
the International Prospectus furnished on behalf of each Manager: the last
paragraph at the bottom of the cover page concerning the terms of the offering
by the Managers, the legend concerning over-allotments and stabilizing on the
inside cover page, the concession and reallowance figures appearing in the fifth
paragraph in the section "Subscription and Sale," the information relating to
the Intersyndicate Agreement in paragraphs 6 and 7 in the section "Subscription
and Sale", the information relating to over-allotments and stabilizing in the
11th paragraph in the section "Subscription and Sale" and the information in the
8th and 12th paragraphs in the section "Subscription and Sale".
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above, except to the extent it has
been materially prejudiced by such failure; and provided, further, that such
omission will not
31
<PAGE>
relieve it from any liability which it may otherwise have to an indemnified
party. In case any such action is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party and after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying party will not
be liable to such indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that the indemnified party shall have the right to employ counsel to represent
the indemnified party and its controlling persons who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by the indemnified party against the indemnifying party under this Section 7 if
the employment of such counsel shall have been authorized in writing by the
indemnifying party in connection with the defense of such action or, if in the
written opinion of counsel to either the indemnifying party or the indemnified
party, representation of both parties by the same counsel would be inappropriate
due to actual or likely conflicts of interest between them, and in that event
the fees and expenses of one firm of separate counsel (in addition to the fees
and expenses of local counsel) shall be paid by the indemnifying party. No
indemnifying party shall, without the prior written consent of the indemnified
party, which consent shall not be unreasonably withheld, effect any settlement
of any pending or threatened action in respect of which any indemnified party is
or could have been a party and indemnity could have been sought hereunder by
such indemnified party unless such settlement includes an unconditional release
of such indemnified party from all liability on any claims that are the subject
matter of such action. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Managers on the other from the offering of
the International Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company
32
<PAGE>
on the one hand and the Managers on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Managers on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the International Securities (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Managers. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Managers and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such Manager has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Managers' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each director, officer, employee
and agent of the Managers and to each person, if any, who controls any Manager
within the meaning of the Act; and the obligations of the Managers under this
Section shall be in addition to any liability which the respective Managers may
otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has signed the
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act.
33
<PAGE>
8. Default of Managers. If any Manager or Managers default in
their obligations to purchase International Securities hereunder on either the
First or any Optional Closing Date and the aggregate number of shares of
International Securities that such defaulting Manager or Managers agreed but
failed to purchase does not exceed 10% of the total number of shares of
International Securities that the Managers are obligated to purchase on such
Closing Date, CSFBL may make arrangements satisfactory to the Company for the
purchase of such International Securities by other persons, including any of the
Managers, but if no such arrangements are made by such Closing Date, the
non-defaulting Managers shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the International Securities that
such defaulting Managers agreed but failed to purchase on such Closing Date. If
any Manager or Managers so default and the aggregate number of shares of
International Securities with respect to which such default or defaults occur
exceeds 10% of the total number of shares of International Securities that the
Managers are obligated to purchase on such Closing Date and arrangements
satisfactory to CSFBL and the Company for the purchase of such International
Securities by other persons are not made within 36 hours after such default,
this Agreement will terminate without liability on the part of any
non-defaulting Manager or the Company, except as provided in Section 9 (provided
that if such default occurs with respect to International Optional Securities
after the First Closing Date, this Agreement will not terminate as to the
International Firm Securities or any International Optional Securities purchased
prior to such termination). As used in this Agreement, the term "Manager"
includes any person substituted for a Manager under this Section. Nothing herein
will relieve a defaulting Manager from liability for its default.
9. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers and of the several Managers set forth
in or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made by
or on behalf of any Manager, the Company or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the International Securities. If this
Agreement is terminated pursuant to Section 8 or if for any reason the purchase
of the International Securities by the Managers is not consummated, the Company
shall remain responsible for the expenses to be paid or reimbursed by it
pursuant to Section 5 and the respective obligations of the Company and the
Managers pursuant to Section 7 shall remain in effect and if any International
Securities have been purchased hereunder the representations and warranties in
Section 7 and all obligations under Section 5 shall also remain in
34
<PAGE>
effect. If the purchase of the International Securities by the Managers is not
consummated for any reason other than solely because of the termination of this
Agreement pursuant to Section 8 or the occurrence of any event specified in
clause (iii), (iv), or (v) of Section 6(c), the Company will reimburse the
Managers for all out-of-pocket expenses (including fees and disbursements of
counsel) reasonably incurred by them in connection with the offering of the
International Securities; provided that the Company shall not be obligated under
this Section 9 to reimburse the U.S. Underwriters or the Managers for any
expenses (including fees and disbursements of counsel) reasonably incurred by
them in connection with the offering of the Offered Securities in excess of
$250,000.
10. Notices. All communications hereunder will be in writing
and, if sent to the Managers, will be mailed, delivered or telegraphed and
confirmed to CSFBL at One Cabot Square, London E14 4QJ, England, Attention:
Company Secretary, or, if sent to the Company, will be mailed, delivered or
telegraphed and confirmed to it at 302 South 36th Street, Suite 400, Omaha,
Nebraska 68131, Attention: General Counsel; provided, however, that any notice
to a Manager pursuant to Section 7 will be mailed, delivered or telegraphed and
confirmed to such Manager.
11. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 7, and no
other person will have any right or obligation hereunder.
12. Representation of Managers. CSFBL will act for the several
Managers in connection with this financing, and any action under this Agreement
taken by CSFBL will be binding upon all the Managers.
13. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
35
<PAGE>
14. Applicable Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to principles of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction
of the Federal and state courts in the Borough of Manhattan in The City of New
York in any suit or proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby.
36
<PAGE>
If the foregoing is in accordance with the Managers'
understanding of our agreement, kindly sign and return to us the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Managers in accordance with its terms.
Very truly yours,
CALENERGY COMPANY, INC.
By: /s/
___________________________
Name:
Title:
The foregoing Subscription Agreement is hereby confirmed and accepted as of the
date first above written.
Credit Suisse First Boston (Europe) Limited
Lehman Brothers International (Europe)
ABN AMRO Rothschild
HSBC Investment Bank plc
UBS Limited
c/o Credit Suisse First Boston (Europe) Limited ("CSFBL")
One Cabot Square
London, England E14 4QJ
Acting on behalf of
themselves and as the
Representatives of the several Managers.
By CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
By: /s/
___________________________
Name:
Title:
37
<PAGE>
SCHEDULE A
Number of
Manager International Firm Securities
- ------- -----------------------------
Credit Suisse First Boston (Europe) Limited 1,237,500
Lehman Brothers International (Europe) 1,237,500
ABN AMRO Rothschild.............................. 675,000
HSBC Investment Bank Plc......................... 675,000
UBS Limited...................................... 675,000
----------
Total..................................... 4,500,000
<PAGE>
SCHEDULE B
Subsidiaries
Coso Funding Corp.+
Incorporated in Delaware
Coso Hotsprings Intermountain Power, Inc. +
Incorporated in Delaware
China Lake Operating Company +
Incorporated in Delaware
Coso Technology Corporation +
Incorporated in Delaware
China Lake Geothermal Management Company +
Incorporated in Delaware
China Lake Plant Services, Inc. +
Incorporated in California
Coso Hotsprings Overland Power, Inc.+
Incorporated in Delaware
CE Geothermal, Inc.
Incorporated in Delaware
Western States Geothermal Company
Incorporated in Delaware
Intermountain Geothermal Company
Incorporated in Delaware
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
CalEnergy Development Corporation
Incorporated in Delaware
California Energy Yuma Corporation
Incorporated in Utah
California Energy General Corporation
Incorporated in Delaware
Rose Valley Properties, Inc.
Incorporated in Delaware
CalEnergy Minerals, Inc.
Incorporated in Delaware
CBE Engineering Co.
Incorporated in California
CE Exploration Company
Incorporated in Delaware
CE Newberry, Inc.
Incorporated in Delaware
CE International Investments Inc.
Incorporated in Delaware
CE Philippines Ltd.
Incorporated in Bermuda
CE Mahanagdong Ltd.
Incorporated in Bermuda
Ormoc Cebu Ltd.
Incorporated in Bermuda
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
CE Cebu Geothermal Power Company, Inc.+
Incorporated in the Philippines
CE Indonesia Ltd.+
Incorporated in Bermuda
CE Casecnan Ltd.
Incorporated in Bermuda
CE Singapore Ltd.
Incorporated in Bermuda
CalEnergy International Ltd.
Incorporated in Bermuda
CE Bali, Ltd.
Incorporated in Bermuda
CE Casecnan Water and Energy Company, Inc.+
Incorporated in the Philippines
Capital Stock: Owned 35% by CE Casecnan Ltd.,
35% by Kiewit Energy International (Bermuda) Ltd.,
15% by La Prairie Group Contractors (International) Ltd and 15% by San
Lorenzo Ruiz Builders & Developers Group, Inc.
Magma Power Company+
Incorporated in Nevada
CalEnergy Operating Company+
Incorporated in Delaware
Salton Sea Power Company+
Incorporated in Nevada
Vulcan Power Company+
Incorporated in Nevada
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Imperial Magma+
Incorporated in Nevada
Magma Land Company I+
Incorporated in Nevada
Desert Valley Company+
Incorporated in California
Fish Lake Power Company+
Incorporated in Delaware
Magma Netherlands B.V.+
Formed in the Netherlands
Tongonan Power Investment, Inc.+
Incorporated in the Philippines
Salton Sea Funding Corporation +
Incorporated in Delaware
Salton Sea Royalty Company+
Incorporated in Delaware
CE Asia Ltd.+
Incorporated In Bermuda
American Pacific Finance Company
Incorporated in Delaware
CalEnergy International Services, Inc.
Incorporated in Delaware
CalEnergy Imperial Valley Company, Inc.
Incorporated in Delaware
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
California Energy Retail Company, Inc.
Incorporated in Delaware
CE Humboldt, Inc.
Incorporated in Delaware
CE Ijen Ltd.
Incorporated in Bermuda
Magma Generating Company I
Incorporated in Nevada
Magma Generating Company II
Incorporated in Nevada
Peak Power Corporation
Incorporated in California
CE Luzon Geothermal Power Company, Inc.+ Incorporated in the
Philippines Capital Stock: Owned 50% by CE Mahanagdong Ltd.; 50% by
Kiewit Energy International (Bermuda) Ltd.; an industrial company has
the right to acquire 10% of the equity - 5% from CE Mahanagdong Ltd.
and 5% from Kiewit Energy International (Bermuda) Ltd.
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Himpurna California Energy Ltd.+
Incorporated in Bermuda
Capital Stock: Owned 47% by CE Indonesia Ltd.; 47% by Kiewit Energy
International (Bermuda) Ltd., and 6% by P.T. Himpurna Enersindo Abadi;
("Himpurna"). Himpurna has assigned the right to certain preferred
dividends representing a 4% interest in Himpurna California Energy
Ltd., under the Joint Operating Contract, Pertamina has certain rights
to acquire up to a 25% interest in the Joint Operating Contract, but
not under the Energy Sales Contract
Patuha Power, Ltd.+
Incorporated in Bermuda
Capital Stock: Owned 44% by CE Singapore Ltd., and 44% by Kiewit Energy
International (Bermuda) Ltd.; and 12% by Mahaka Energy; under the Joint
Operating Contract, Pertamina has certain rights to acquire up to a 25%
interest in the Joint Operating Contract, but not under the Energy
Sales Agreement
Bali Energy Ltd.+
Incorporated in Bermuda
Capital Stock: Owned 50% by CE Bali Ltd. and
50% by Kiewit Energy International (Bermuda) Ltd.
P.T. Pandanwangi Sekartji has the right to acquire
up to 40% of the equity in Bali Energy Ltd.
Norming Investments BV+
Incorporated in the Netherlands
BN Geothermal Inc.+
Incorporated in Delaware
Conejo Energy Company+
Incorporated in California
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Niguel Energy Company+
Incorporated in California
San Felipe Energy Company+
Incorporated in California
CE/FS Holding Company, Inc.
Incorporated in Delaware
Falcon Seaboard Power Corporation
Incorporated in Texas
Falcon Seaboard Resources, Inc.
Incorporated in Texas
Falcon Seaboard Energy Corporation
Incorporated in Texas
Falcon Seaboard Gas Company
Incorporated in Texas
Falcon Seaboard Oil Company
Incorporated in Texas
Falcon Seaboard Pipeline Corporation
Incorporated in Texas
Big Spring Pipeline Company
Incorporated in Texas
Falcon Power Operating Company
Incorporated in Texas
Power Resources, Inc.+
Incorporated in Texas
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
North Country Gas Pipeline Corporation + Incorporated in New York Owned
by Saranac Power Partners, L.P.
Saranac Energy Company, Inc.+
Incorporated in Delaware
SECI Holdings, Inc.+
Incorporated in Delaware
Northern Consolidated Power, Inc. +
Incorporated in Delaware
NorCon Holdings, Inc.
Incorporated in Delaware
CE Electric, Inc.
Incorporated in Delaware
CE Power, Inc.
Incorporated in Delaware
CE Electric UK plc +
Incorporated in England
Capital Stock: Owned by CE Electric UK Holdings
American Pacific Finance Company II +
Incorporated in Delaware
Capital Stock: Owned 50% by CalEnergy Company, Inc. and
50% by Kiewit Energy Company
CE Indonesia Geothermal, Inc.
Incorporated in Delaware
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Slupo I B.V.+
Incorporated in Netherlands
Owned 50% by CE Asia Ltd. and 50% by Kiewit
Energy International (Bermuda) Limited
CE Indonesia Funding Corp. +
Incorporated in Delaware
Owned 50% by Himpurna California Energy Ltd.
and 50% by Patoha Power, Ltd.
Gilbert/CBE Indonesia L.L.C.
Organized in Nebraska
Owned 60% Gilbert Industrial Corporation and 40% CBE Engineering
Co.
Northern Electric plc+ Incorporated in England and Wales Owned by CE
Northern UK plc.
Northern Electric Generation (NPL) Limited + Incorporated in England
and Wales Owned by Northern Electric plc.
Northern Electric Supply Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Share Scheme Trustee Limited + Incorporated in
England and Wales Owned by Northern Electric plc.
Northern Transport Finance Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Northern Electric Retail Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Properties Limited + Incorporated in England and
Wales Owned by Northern Electric plc.
Northern Electric Distribution Limited
Incorporated in England and Wales
Owned by Northern Electric plc.
CE Gas UK Ltd.+ Incorporated in England and Wales Owned by Northern
Electric plc.
Combined Power Systems (Northern) Limited+
Incorporated in England and Wales
Northern Electric (Overseas Holdings) Limited + Incorporated in England
and Wales Owned by Northern Electric plc.
Northern Electric Generation (CPS) Limited + Incorporated in England
and Wales Owned indirectly by Northern Electric plc.
Kings Road Developments Limited+ Incorporated in England and Wales
Owned indirectly by Northern Electric plc.
Ryhope Road Developments Ltd. +
Incorporated in England and Wales
Owned 48% by Northern Electric Properties Ltd. and
51% by Bewey Group Limited
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Stamfordham Road Developments Ltd.+
Incorporated in England and Wales
Owned 48% by Northern Electric Properties Ltd. and
51% by Cussins Commercial Development Ltd.
Northern Electric Generation (TPL) Limited + Incorporated in England
and Wales Owned indirectly by Northern Electric plc.
Northern Electric Generation Limited + Incorporated in England and
Wales Owned by Northern Electric plc.
Northern Electric Insurance Services Limited + Incorporated in England
and Wales Owned indirectly by Northern Electric plc.
Northern Metering Services Limited + Incorporated in Isle of Man Owned
indirectly by Northern Electric plc.
CalEnergy Gas (UK) Limited + Incorporated in England and Wales Owned
indirectly by Northern Electric plc.
Northern Electric Generation (Peaking) Limited + Incorporated in
England and Wales Owned by Northern Electric plc.
Northern Electric Training Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Electric Transport Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Northern Information Systems Limited +
Incorporated in England and Wales
Owned by Northern Electric plc.
Northern Utility Services Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
Viking Power Ltd.+
Incorporated in England and Wales
Capital Stock: Owned 50% by Northern Electric Generation Limited
and 50% by Rolls-Royce Power Ventures Limited
Northern Electric Finance + Incorporated in England and Wales Owned
indirectly Northern Electric plc.
Northgas Limited + Incorporated in England and Wales Owned by Northern
Electric plc.
Northern Tracing & Collection Services Limited + Incorporated in
England and Wales Owned by Northern Electric plc.
Northern Electric Telecom Limited + Incorporated in England and Wales
Owned by Northern Electric plc.
CE Electric UK Holdings +
Incorporated in England
Capital Stock: Owned 35% CE Power, Inc., 35% CE Electric Inc. and
30% by Kiewit Energy UK, Inc.
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
CalEnergy Gas (Polska) *Polish limited liability company Owned
indirectly by Northern Electric plc.
CalEnergy Capital Trust I
Formed under the laws of Delaware
CalEnergy Capital Trust II
Formed under the laws of Delaware
CalEnergy Capital Trust III
Formed under the laws of Delaware
CalEnergy Capital Turst IV
Formed under the laws of Delaware
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
SCHEDULE C
Joint Ventures
Coso Energy Developers (CED)+
Formed in California
General Partnership: 48% CHIP; 52% Caithness Coso
Holdings, L.P.
Coso Finance Partners+
Formed in California
General Partnership: 46.3% owned by CLOC; 53.7%
owned by ESCA I, L.P.
Coso Power Developers (CPD)+
Formed in California
General Partnership: 50% owned by CTC; 50% by
Caithness Navy II
Coso Transmission Line Partners+
Formed in California
General Partnership: Owned 50% by CED; 50% by CPD
Vulcan/BN Geothermal Power Company+
Formed in Nevada
Partnership Interests: Vulcan Power Company 50%
General Partner; BN Geothermal, Inc. 50% General
Partner
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
Del Ranch, L.P.+
Formed in California
Partnership Interests: Magma Power Company 10%
Limited Partner; CalEnergy Operating Company 40% General Partner;
Conejo Energy Company 10% Limited Partner and 40% General Partner
Elmore, L.P.+
Formed in California
Partnership Interests: Magma Power Company 10%
Limited Partner; CalEnergy Operating Company 40% General Partner;
Niguel Energy Company 10% Limited Partner
and 40% General Partner
Leathers, L.P.+
Formed in California
Partnership Interests: Magma Power Company 10%
Limited Partner; CalEnergy Operating Company 40% General Partner; San
Felipe Energy Company 10% Limited Partner and 40% General Partner
Salton Sea Brine Processing L.P.+
Limited Partnership Formed in California
Salton Sea Power Generation L.P.+
Limited Partnership Formed in California
Visayas Geothermal Power Company+
Partnership Formed in the Philippines
Yuma Cogeneration Associates+
Formed in Utah
Alto Peak Power Company
Formed in the Philippines
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
China Lake Joint Venture
Formed in California
Owed 50% by CalEnergy Company and
50% by Caithness Geothermal 1980 Ltd.
Coso Finance Partners II
Formed in California
Owned 50% by China Lake Geothermal Management Co., an affiliate of
Calenergy Company, Inc. and 50% by ESCA II, L.P.
Coso Land Company
Formed in California
Owned 50% by CalEnergy Company and 50% by Caithness Geothermal 1980
Ltd.
Gilbert/CBE L.P.
Limited partnership formed in Nebraska
Partnership Interests: 20% CBE Engineering Co. and 80% Gilbert
Industrial Corporation
Saranac Power Partners, L.P.+
Limited partnership formed in Delaware
Partnership Interests: 80% Saranac Energy Company, Inc. and 20%
affiliates of Tomen Power Corporation
NorCon Power Partners, L.P.+
Limited partnership formed in Delaware
Partnership Interests: 80% Northern Consolidated Power, Inc. and 20%
affiliates of Tomen Power Corporation
- --------------------------
+ Indicates stock or partnership interests that are and at the Closing Date will
continue to be pledged, subject to a purchase agreement, or otherwise encumbered
and subject to foreclosure or other exercise of remedies.
<PAGE>
WALTER SCOTT, JR.
1000 Kiewit Plaza
Omaha, Nebraska 68121
October 13, 1997
Mr. David L. Sokol
Chairman & Chief Executive Officer
CalEnergy Company, Inc.
302 South 36th Street, Suite 400
Omaha, Nebraska 68131
RE: Purchase of Common Stock
Dear David:
This confirms that the undersigned and/or certain trusts and other
entities directly or indirectly related to the undersigned has received the
Preliminary Prospectus dated September 24, 1997 relating to the proposed public
offer of 14 million shares of CalEnergy Company, Inc. ("CECI") common stock, and
the undersigned and/or such trusts and other entities, as reflected on Exhibit
"A", will purchase in the aggregate two million shares of such offered common
stock at the public offering price and subject to the underwriting discounts and
commissions set forth in the Final Prospectus.
If necessary, due to Hart-Scott-Rodino Act ("HSR") requirements, it is
acknowledged that the consideration of the shares (and the shares) will be
delivered at closing into a mutually satisfactory escrow arrangement, pending
the expected early termination of the HSR waiting period.
Sincerely,
/s/ Walter Scott, Jr.
Walter Scott, Jr.
<PAGE>
EXHIBIT "A"
Walter Scott Charitable Remainder Unitrust (II)
<PAGE>
FOR IMMEDIATE RELEASE
Craig M. Hammett - Vice President, Chief Financial Officer (402) 341-4500
Jeffrey S. Laudin - Manager, Investor Relations (402) 341-4500
CalEnergy Sells 17 Million Shares at $37 7/8 Per Share
OMAHA, NE, October 14, 1997: CalEnergy Company, Inc. ("CalEnergy" or
the "Company") (NYSE, PCX and LSE Symbol: CE) announced today the pricing of the
public offering of 15 million shares of its Common Stock (the "Common Stock") at
$37 7/8 per share in simultaneous United States and international offerings. In
addition, 2 million shares of Common Stock are being purchased by a trust
affiliated with Walter Scott Jr., the Chairman and Chief Executive Officer of
Peter Kiewit Sons', Inc., directly from the Company contemporaneously with or
shortly after the closing of the public offering. The Company has also granted
the Underwrites an option to purchase up to an additional 2.1 million shares of
Common Stock to cover over-allotments. The closing of the public offering is
scheduled to occur on October 17, 1997.
The Company will use the net proceeds from the 15 million share public
offering and the 2 million share direct sale, together with the expected
proceeds of a subsequent offering of Senior Notes due 2007 and general corporate
funds of the Company, to complete the acquisition of all of the interests of
Kiewit diversified Group Inc. ("KDG") in the various international power
generation projects (the "Joint Venture Energy Projects") which are jointly
owned with the Company and managed by the Company, as well as the repurchase of
all of KDG's outstanding ownership interests in the Company's Common Stock. The
KDG acquisition agreement provides that the Company will pay $1,155,000,000 for
KDG's ownership interest in the Joint Venture Energy Projects and the Company's
Common Stock. The closing under the KDG acquisition agreement is expected to
occur in January, 1998.
Credit Suisse First Boston Corporation, Lehman Brothers, Donaldson
Lufkin & Jenrette Securities Corporation and Merrill Lynch, Pierce, Fenner &
Smith Incorporated are the managers of the U.S. offering. Credit Suisse First
Boston (Europe) Limited, Lehman Brothers International (Europe), ABN AMRO
Rothschild, HSBC Investment Bank Plc and UBS Limited are the managers of the
international offering.
A prospectus relating to these securities may be obtained from Credit
Suisse First Boston Corporation, Park Avenue Plaza, New York, New York 10055,
(212) 909-2000.
<PAGE>
This release shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any sale of these securities in any state
in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities law of any such state.
The Company, which manages and owns interests in over 5,000 net MW of
power generation facilities in operation, construction and development
worldwide, currently operates 20 generating facilities and also supplies and
distributes electricity to 1.5 million customers.
www.calenergy.com
